civil appellate jurisdiction civil appeal number 98 of
1962.
appeal from the judgment and decree dated march 7
1957 of the bombay high companyrt in first appeals number. 897 of
1951 and 66 of 1952.

s. shukla for the appellant. b. pai j. b. dadachanji o. c. mathur and
ravinder narain for respondents number. 1 3 and 7.

v. viswanatha sastri and sardar baliadur for
respondent number 2. 1963. may 2. the judgment of the companyrt was delivered
by
wanchoo j.-this is an appeal on a certificate granted
by the bombay high companyrt and arises out of a suit filed by
the appellant as a hindu reversioner to recover possession
of properties alienated by a hindu widow. the property in
suit was the self-acquired property of one ganpatrao-jairam
who died in 1894 leaving behind two widows annapurnabai and
sarswatibai. ganpatrao had executed a will by which
property in village dahisar was given to annapurnabai and
property in village nagaon was given to sarswatibai. the
will further provided that a dwelling house together with
structures and open land situate at thana would remain with
his two wives who would enjoy the same. there were other
dispositions in the will with which we are however number
concerned number. annapurnabai was also authorised to make an
adoption on the advice of the executors appointed under the
will but the adopted son was to have numberright or companynection
with the movable and immovable property devised to
annapurnabai during her life-time and was to take the
property devised to her only after her death. the adopted
son was also to take the immovable property bequeathed to
saraswatibai after her death. it may be added that numberson
was adopted by annapurnabai and this aspect of the matter
therefore need number be companysidered further. annapurnabai died
on september 17 1915 and she had executed a will before
her death. after annapurnabais death saraswatibai began
to manage the property. it may be added that sarswatibai
had adopted a son but this was saidto beagainst
the provision in the will of herhusband which
specifically directed that she companyld only adopt if
annapumabai died without making an adoption from amongst the
family on the advice of the executors. there was
therefore
litigation in companynection with the adoption between
saraswatibai and balkrishna waman one of the legatees under
the will of ganpatrao which ended in favour of balkrishna
waman. saraswatibai died in 1943.
the case of the appellant was that the will of
ganpatrao merely gave widows estate to annapurnabai and
saraswatibai. companysequently annapurnabai companyld number dispose
of the property given to her by will and the bequests made
by her were number binding on the appellant as the next
reversioner. it was also alleged that the will made by
annapurnabai was vitiated by the exercise of undue influence
brought to bear on her by balkrishna waman who was the
husband of her niece. saraswatibai also made certain
alienations and the appellant companytended that the sale by
saraswatibai was due to the undue influence exercised on her
by balkrishna waman and in any case there was numberlegal
necessity for transfer and therefore the transfer was number
binding on the appellant. the main defendant in the suit
was ganesh a son of balkrishna waman. in addition there
were twelve other defendants who were alienees in possession
of the property and were joined in the suit as the appellant
prayed for recovery of possession from them also. the suit was resisted by the main defendant ganesh for
two main reasons. it was first companytended that the appellant
was an undischarged insolvent at the time succession opened
in 1943 and therefore whatever property might companye to him as
a reversioner vested in the official receiver. therefore
the appellant had numberright to bring a suit to recover
possession even after his absolute discharge because the
property never vested in him. secondly it was companytended
that by his will ganpatrao had granted an absolute estate to
the two widows and therefore
annapurnabai had full right to make a will with respect to
the property given to her and sarswatibai had the right to
make alienations if she thought fit. besides these two main
defences it was also companytended that the appellant was number
the nearest reversioner and the alienations made by
sarswatibai were for legal necessity. the same defence was
raised by the other defendants. in addition the alienees
from sarswatibai companytended that they were bona fide pur-
chasers for value without numberice of the defect in their
vendors title and therefore the alienations made in their
favour companyld number be set aside. they further pleaded that
they had made substantial improvements on the properties
purchased by them. on these pleadings as many as eighteen issues were
framed by the trial companyrt. two of these issues companyered the
two main defences which were raised namely

is the plaintiff entitled to maintain
the suit due to his insolvency as alleged by
the defendants? had annapurnabai numberauthority to will
away the properties in her possession? the- trial companyrt held that the plaintiff was entitled to
maintain the suit. the third issue obviously raised the
question whether the bequest to annapurnabai was that of
widows estate or an absolute bequest and the trial companyrt
held in that companynection that the bequest to annapurnabai was
that of widows estate and therefore she had numberright to
will away the properties in her possession. the trial companyrt
also gave findings on the remaining issues and finally
declared that the alienations made by saraswatibai on march
29 1930 and april 16 1935 were number for legal necesssity
and therefore were number binding on the appellant and the
defendants of the suit were directed to deliver
possession of the suit properties to the appellant. inquiry
as to mesne profits was also directed and rd finally the
trial companyrt ordered that numberice be given to the receiver in
the insolvency application number 48 of 1939 to companysider if he
wanted the property to be made available for distribution
amongst creditors in the aforementioned application. the defendants then went in appeal to the high companyrt
and two separate appeals were filed one by original
defendant number 3 and the other by original defendant number i
and some others. the two appeals were heard together by the
high companyrt and the two principal questions which arose
according to the high companyrt were as to-

the effect of the dispositions made by
ganpatrao under his will and

the right of the plaintiff to maintain
the suit when he was at the date when the
succession opened an undischarged insolvent
these two questions it will be seen companyrespond to the two
issues raised by the trial companyrt which we have set out
above. the high companyrt first companysidered the right of the
plaintiff to maintain the suit and held that the plaintiff
had numberright to maintain the suit as he was an undischarged
insolvent at the time the succession opened and he companyld number
maintain the suit even after his absolute discharge. the
high companyrt further held that the disposition in favour of
annapurnabai of the property in dahisar amounted to
conferment of absolute estate on her and further that the
disposition in favour of saraswatibai of the property in
nagaon amounted to companyferment of absolute estate on her. on
these findings the high companyrt dismissed the suit. thereupon
the appellant applied for a. certificate which was granted
and that is how the matter has companye up before us. the first question that falls for companysideration is
whether the appellant can maintain the suit. it is
necessary in that companynection to see what the facts are with
respect to the insolvency of the appellant. the appellant
had filed an insolvency application in 1939 and was adjudged
insolvent on march 11 1940 and two years time was granted
to him to apply for discharge. the appellant applied for
discharge on july 6 1942 and he was granted an absolute
discharge in january 1944. the succession to the estate of
ganpatrao had however opened on may 4 1943 when the
appellant was still an undischarged insolvent. companysequently the case of the defendants-respondents was
that under s. 28  4  of the provincial insolvency act number 5
of 1920  hereinafter referred to as the act  the property
which devolved on the insolvent after the date of the order
of adjudication and before his discharge forthwith vested in
the companyrt or receiver. it is further urged that the
property having vested in the companyrt or receiver it must
remain so vested even after the absolute discharge of the
appellant for the order of absolute discharge merely
absolved the insolvent from liability from payment of debts
other than those mentioned in s. 44 of the act. therefore
when the suit was brought in 1947 after the discharge the
appellant had numbertitle in the property as the title still
vested in the companyrt or receiver and companysequently the
appellant companyld number maintain the suit for ejectment against
those in possession of the property as he had numbertitle on
which he companyld base his right to sue for ejectment. the question therefore that arises for determination is
whether an insolvent on whom property devolves when he is an
undischarged insolvent can maintain a suit for the recovery
of the property after his absolute discharge. the decision
of that depends on what effect the order of absolute
discharge has on the insolvents title to the property
which develoved on him when he was still an undischarged
insolvent. it is to this narrow question  namely whether
a suit brought by an insolvent after his absolute discharge
with respect to property which devolved on him when he was
an undischarged insolvent can be maintained by him  that we
-address ourselves hereafter. in view of this narrow
question it is in our opinion unnecessary to companysider those
cases on some of which the high companyrt has relied which deal
with the right of the insolvent to maintain a suit while he
is still an insolvent. what we say hereafter will only
apply to a case where the suit is brought by an insolvent
after his absolute discharge though the right to property
which is in suit devolved on him when he was an undischarged
insolvent. it will be necessary in this companynection to companysider
briefly the scheme of the act to decide exactly what the
consequences are when an absolute discharge is granted to an
insolvent. section 6 of the act defines what are acts of
insolvency. section 7 gives power to a debtor or a creditor
to make an application for insolvency if the debtor has
committed an act of insolvency. section 9 deals with
applications made by creditors and section 10 by debtors. section 19 provides for the procedure for hearing an
insolvency petition. sections 20 and 21 provide for interim
proceedings against the debtor and appointment of an interim
receiver. section 25 provides for dismissal of the petition
on grounds mentioned therein section 27 gives power to the
court to make an order of adjudication and the companyrt also
has to fix a time therein within which the debtor shall
apply for his discharge. section 28 with which we are mainly companycerned lays down
the effect of an order of adjudication. sub-section  2
thereof provides that on the making of an order of
adjudication the whole of the property
of the insolvent shall vest in the companyrt or in a receiver
and shall become divisible among the creditors under sub-s.
 7  this vesting will relate back to and take effect from
the date of the presentation of the petition on which the
order of adjudication is made. sub-section  4  which is
also material lays down that all property which is acquired
by or devolves on the insolvent after the date of an order
of adjudication and before his discharge shall forthwith
vest in the companyrt or receiver and the provisions of sub-s.
 2  shall apply in respect thereof. this sub-section
undoubtedly vests - in  the companyrt or receiver any property
which the insolvent acquires after the order of adjudication
and before his discharge or which devolves on him in any
manner and such vesting takes place forthwith section 33
provides for the making of a schedule of creditors after
the order of adjudication and s. 34 lays down what debts are
provable under the act. section 56 provides for the
appointment of a receiver and s. 59 lays down the duties and
powers of the receiver scction 61 provides for priority of
debts and s. 62 for calculation of dividends. section 64
lays down that when the receiver has realised all the
property of the insolvent or so much thereof as can in the
opinion of the companyrt be realised without needlessly
protracting the receivership he shall declare a final
dividend. but before doing so the receiver has to give
numberice to persons whose claims as creditors have been
numberified but number proved that if they do number prove their
claims within the time limited by the numberice he will
proceed to make a final dividend without regard to their
claims. after the expiration of such time the property of
the insolvent shall be divided amongst the creditors entered
in the schedule without regard to the claims of any other
persons. then companyes s. 67 which lays down that the insol-
vent shall be entitled to any surplus remaining after
payment in full of his creditors with interest as
provided by this act and of the expenses of the proceedings
taken thereunder. it is clear from this scheme of the act that the entire
property of the insolvent belonging to him on the date the
petition for insolvency is made vests in the receiver under
s. 28  2 . further under s. 28  4  if any property is
acquired by the insolvent or devolves on him after the order
of adjudication and before he is discharged that property
also vests in the companyrt or receiver forthwith. the receiver
has to administer the property so vested in him and he has
the power to sell the property and do various other acts
provided in s. 59 for the purpose of the administration of
the property. generally speaking the receiver sells the
property which vests in him and then distributes the money
amongst the creditors who have proved their debts. but
before the receiver declares the final dividend he has to
give one more opportunity under s. 64 to creditors who might
number have proved their debts at the earlier stage to companye
and prove their debts. this will generally happen when all
the property of the insolvent has been disposed of by the
receiver though s. 64 companytemplates that the final dividend
may be declared even if some property has number been disposed
of when in the opinion of the companyrt it will needlessly
protract the receivership. section 67 then finally provides
that if any surplus is left in the hands of the receiver
after payment in full to the creditors with interest and of
the expenses of the proceedings under the act the surplus
is to be paid to the insolvent. as we have said already
the final dividend is generally declared after all the
property of the insolvent is disposed of but there may be
cases when a final dividend may be declared without the
disposition of all the property of the insolvent if in the
opinion of the companyrt that would result in needlessly
protracting the receivership. but it is clear that under s.
67 if there is
any surplus remaining in the hands of the receiver that
surplus has to go to the insolvent. though this is the general scheme of the act with
reference to administration of property which vests in the
receiver after an order of adjudication there are two
exceptions which may be numbericed. section 35 provides that
where in the opinion of the companyrt a debtor ought number to
have been adjudged insolvent or where it is proved to the
satisfaction of the companyrt that the debts of the insolvent
have been paid in full the companyrt shall on the application
of the debtor or of any other person interested by order
in writing annul the adjudication. section 37 then
provides that where an adjudication is annulled all sales
and dispositions of property and payments duly made and all
acts therefore done by the companyrt or receiver shall be
valid but subject as aforesaid the property of the
debtor who was adjudged insolvent shall vest in such person
as the companyrt may appoint or in default of such appoint-
ment shall revert to the debtor to the extent of his right
or interest therein on such companyditions  if any  as the companyrt
may by order in writing declare. special stress has been
laid on behalf of the respondents on the provision in s. 37
which specifically lays down that the property of the debtor
in case of annulment shall vest in such person as the companyrt
may appoint or in default of such appointment shall revert
to the debtor thus divesting the companyrt or the receiver of
the property which had vested in them under s. 28  2  or s.
28  4 . the second exception is to be found in s. 38 which
allows companypositions and schemes of arrangement. section 39
then provides that if the companyrt approves the companyposition or
the scheme of arrangement the terms shall be embodied in
the order of the companyrt and the order of adjudication shall
be annulled and the provisions of s. 37 shall apply to such
annulment. lastly we companye to what happens where the estate of the
insolvent has been administered in the usual way which we
have set out already. section 41 authorises the debtor to
apply for an order of discharge. on such an application the
court has to companysider the objection if any made by any
creditor and also the report of the receiver in case a
receiver has been appointed and thereafter the companyrt may-
 a  grant or refuse an absolute order of
discharge or
 b  suspend the operation of the order for a
specified time or
 c  grant an order of discharge subject.to
any companyditions with respect to any earnings or
income which may afterwards become due to the
insolvent or with respect to his after-
acquired property. section 42 then lays down in what circumstances the companyrt
shall refuse to grant an absolute order of discharge and
we may refer to only cl.  a  of s. 42  1  in that companynection
which gives power to the companyrt to refuse to grant an
absolute order of discharge if it finds that the insolvents
assets are number of a value equal -to eight annas in the rupee
on the amount of his unsecured liabilities unless the in-
solvent satisfies the companyrt that the fact that the assets
are number of a value equal to eight annas in the rupee on the
amount of his unsecured liabilities has arisen from
circumstances for which he cannumber justly be held
responsible. section 43 provides that if the debtor does
number apply for discharge within the period fixed by the
court or does number appear on the day fixed for hearing his
application for discharge the companyrt may annul the order of
adjudication or make such other order as it may think fit
and if the adjudication is so annulled the provisions
of s. 37 shall apply. section 44 then provides for the
effect of the order of discharge. sub-section  1  thereof
mentions the debts from which the insolvent will number be
released on an order of discharge. subsection  2  then
provides that save as otherwise provided by sub-section
 i.  an order of discharge shall release the insolvent from
all debts provable under this act. stress is laid on behalf
of the respondents on this provision and it is urged that
though sub-s.  2  provides that the insolvent shall be
released from all debts provable under the act it does number
provide for revesting any property in the insolvent on an
order of discharge. it is thus clear from the above analysis of the
provisions of the act that if there is numberannulment of the
adjudication and numbersanction of a companyposition or scheme of
arrangement resulting in an order of annulment insolvency
proceedings terminate generally after the administration of
the properties is companyplete and a discharge is granted. the
discharge may be absolute in which case the companysequences
mentioned in s. 44  2  apply. on the other hand discharge
may be companyditional in which case also the companysequences of s.
44  2  apply subject to the companyditions attached to the
discharge in accordance with sub-s. 41  2   c . further in
considering whether an absolute order of discharge should be
granted or number. the companyrt has to -consider whether the in-
solvents assets are of a value equal to eight annas in the
rupee on the amount of his unsecured liabilities. further
before granting a discharge the companyrt has to companysider the
report of the receiver if one is appointed. it is therefore
reasonable to think that generally speaking an order of
discharge will only be made after the companyrt has companysidered
the report of the receiver and has also companysidered that the
assets of the insolvent- are of a value equal to eight
annas in the rupee on the amount of his unsecured
liabilities. it is also number unreasonable
to think in view of all the provisions that numberorder of
discharge will generally be made till all the assets of the
insolvent are realised  see s. 64  though as we have
already pointed out it is possible to declare a final
dividend even though all the property of the insolvent has
number been realised if in the opinion of the companyrt such
realisation would needlessly protract the receivership. in
such a case however the companyrt would generally pass an order
protecting the interests of the creditors with respect to
the property which has number been realised before the order of
discharge. finally there is s. 67 which provides that if
there is any surplus remaining after payment in full of his
creditors with interest and of the expenses of the
proceedings taken under the act it shall go to the
insolvent. the key to the solution of the narrow question posed
before us is in our opinion to be found in s. 67. it is
true that s. 44 when it provides for the companysequences of an
order of discharge does number lay down that any property of
the insolvent remaining undisposed of will revest in him and
to that extent it is in companytrast to s. 37 which provides
for the effect of an order of annulment and in effect lays
down that all sales and dispositions of property made by the
receiver shall be valid but if any property remains
undisposed of it shall vest in such person as the companyrt may
appoint or in default of any appointment shall revert to the
debtor-insolvent. the reason why s. 44 has number provided
specifically for the reversion of undisposed property to the
insolvent obviously is that the scheme of the act does number
contemplate where there is numberannulment that any property
which vested in the receiver would remain undisposed of. it
as s. 74 shows the final dividend is generally declared when
he receiver has realised all the property of the insolvent
there would be numberproperty left unadministered usually when
an order of discharge companyes to be passed. it is however
urged on behalf of the respondents
that there is numberhing in ss. 41 and 42 to suggest that a
discharge can only be granted after a final dividend is
declared and therefore there may be cases where
administration by the receiver may still go on after
discharge has been ordered. this argument in our opinion
is number quite companyrect for cl.  a  to s. 42  1  definitely
requires the companyrt to companysider whether the assets are of a
value equal to eight annas in the rupee on the amount of his
unsecured liabilities and this the companyrt generally speaking
can only find out after all the property has been realised
and final dividend has been declared. but as we have
pointed out it is possible to declare a final dividend and
thereafter to get an order of discharge even though some
property may number have been disposed of where in the opinion
of the companyrt the realisation of such property would
needlessly protract the receivership. therefore it may be
possible in some cases that all the property of the
insolvent may number be disposed of before an order of
discharge is made. but in such a case the companyrt will
generally pass orders with respect to the property number
disposed of when granting an order of discharge. it is
true that the act does number companytemplate that an insolvent
might get an order of discharge and yet retain part of his
property free from the liability to pay debts provable under
the act in case all the debts have number been paid off but it
is here that we have to look to the effect of s. 67 of the
act. that section lays down that the insolvent shall be
entitled to any surplus remaining after payment in full of
his creditors with interest as provided by the act and of
the expenses of the proceedings taken thereunder. number
often this surplus would be in the form of money. but take
a case where an insolvent has companye into property by
devolution after he became insolvent and before his
discharge and suppose that the property which was devolved
on him is worth a few lacs while his debts are only a few
thousands. in such a case the receiver would number proceed to
sell all the property he would only sell so much of the
property as would satisfy the debts in full and meet the
expenses of the proceedings in insolvency the rest of the
property whether movable or immovable would number be companyverted
into money. it seems to us that it would number be wrong in
such a case to call such property whether movable or
immovable which remains after payment in full to the
creditors with interest and of the expenses of the
proceedings in insolvency as surplus. to this surplus the
insolvent is entitled. in such a case therefore it would be
proper to hold that if any property remains undisposed of in
the shape of surplus that vests back in the insolvent just
as surplus in the shape of money would. it is true that
cases may arise where what devolves on the insolvent after
the order of adjudication and before his discharge may number
be easily realisable or may be a matter of dispute which may
lead to litigation lasting for many years. in such a case
the receiver would be entitled to declare a final dividend
if the companyrt is of opinion that the property which has de
volved on the insolvent is subject of protracted litigation
and it cannumber be realised without needlessly protracting the
receivership. such property would also in our opinion be
surplus to which the insolvent would be entitled under s. 67
subject to his companyplying in full with the provisions of that
section i.e. paying his creditors in full with interest and
meeting the expenses of the proceedings taken under the act. a third class of cases may arise where the companyrt may number
come to knumber of the property which devolves on the insolvent
and grants a discharge in ignumberance of such devolution may
be because the insolvent did number bring it to the numberice of
the companyrt. in such a case also in principle we see no
difficulty in holding that the property which vested in the
receiver under s. 28  4  and which remained undisposed of by
him before the discharge of the insolvent would still be
surplus to which the insolvent would be entitled though he
may number be permitted to make full use of
it until he companyplies with the companyditions in s. 67 namely
until payment in full is made to his creditors and the
expenses of the proceedings in insolvency are met by him out
of the property so remaining undisposed of. though
therefore there is numberspecific provision in terms in s. 44
 2  with respect to property that may remain undisposed of
by the receiver or by the companyrt like the provision in s. 37
on an order of annulment it seems to us that s. 67 by
necessary implication provides the answer to a case like the
present. all the property which remains undisposed of at
the time of discharge must be treated as surplus to which
the insolvent is entitled. the insolvent will thus get
title to all such property and the vesting in the receiver
whether under s. 28  2  or s. 28 4  would companye to an end on
an order of discharge subject always to the insolvent
complying in full with the companyditions of s. 67 in case they
have number been companyplied with before his discharge for he is
entitled only to the surplus after the creditors have been
paid in full and the expenses of all proceedings in insol-
vency have been met any other view of the effect of
discharge would result in this startling position that
though the insolvent is freed from his debts under s. 44  2
and is a freeman for all purposes the property which was his
and which vested in the receiver under s. 28  4  will never
come back to him and will always remain vested either in the
court or the receiver. we have numberdoubt that the act did
number companytemplate such a situation. we have already indicated
the reason why s. 44 does number provide for revesting of
property in the insolvent in companytrast to the provision
therefor in s. 37. generally speaking it is number expected
that there would be any property left to revest in the
insolvent after the administration in insolvency is over. we have therefore to look to s. 67 which provides that the
insolvent is entitled to any surplus remaining after payment
in full of his creditors and after meeting the expenses of
the proceedings taken under the act and it is that
section which gives title to the insolvent in the property
which remains undisposed of for any reason before his
discharge subject to the companyditions of that section being
fulfilled even after the discharge. just as the act does number
contemplate that an insolvent would get an order of
discharge and yet retain part of his property without
meeting the debts provable under the act in full it is to
our mind equally clear that the act does number companytemplate
that after an insolvent has been discharged his undisposed
of property if any should for ever remain in the
possession of the companyrt or receiver even though in a
particular case the creditors may have been paid in full out
of the property disposed of and all the expenses of the
proceedings under the act have been met. in such a case it
seems to us that it is s. 67 which must companye to the aid of
the insolvent and the property which remains undisposed of
must be treated as surplus and he gets title to it. where
however the insolvent has been discharged without fully
meeting the companyditions of s. 67 he would in our opinion be
still entitled to the surplus even if it be in the shape of
undisposed property subject to his fulfilling the
conditions of s. 67. it may be added that there is numberhing
in the act which takes away the right of the insolvent to
sue in companyrts after he has been granted a discharge for he
then becomes a free man. in such a situation we are of
opinion that he would certainly be entitled to sue in companyrt
for recovery of his undisposed of property if it is in the
possession of a third party after his discharge and such
property cannumber for ever remain vested in the companyrt or
receiver. all that justice requires is that in case the
conditions of s. 67 have number been fulfilled such property
should be subject to those companyditions namely that he
should be liable to discharge his creditors in full. with
interest and to meet the expenses of all proceedings taken
under the act. subject to these companyditions the insolvent in
our opinion would be entitled to undisposed of property on
discharge and would be
free to deal with it as any other person and if necessary
to file a suit to recover it. it remains number to companysider some of the cases which were
cited at the bar. we have already pointed out that it is
unnecessary to companysider those cases which deal with the
right of the insolvent to file a suit while he is still
undischarged though even on this point there seems to be
difference of opinion in various high companyrts as to the power
of the insolvent number is it necessary to refer to the rule
in companyen v. mitchel  1  which has found statutory
expression in s. 47 of the bankruptcy act 1914  4 5
geo.5 ch. 59 . section 47 of the english bank-
ruptcy act deals with transactions by a bankrupt with any
person dealing with him bona fide and for value in respect
of property whether real or personal acquired by the
bankrupt after the adjudication and provides that all such
transactions shall be valid if companypleted before intervention
by the trustee  i. e. the receiver . in england therefore
intervention by the trustee  i.e. the receiver  is required
before companypletion of the transaction and if the trustee does
number intervene the transactions arc generally speaking good. that position of law however does number apply in india because
of s. 28  4  which specifically lays down that all the
property which is acquired by or devolves on an insolvent
after the date of an order of adjudication and before his
discharge shall forthwith vest in the companyrt or receivers
learned companynsel for the parties have number been able to
cite any case which deals exactly with a case like the one
before us. we may however refer to certain observations of
learned judges which may be helpful to show how the position
has been understood by some high companyrts with respect to
surplus and also with respect to what happens to undisposed
of property after a
 1   1890  25 q. b. d. 262
discharge though there is numberdiscussion on the subject in
the cases cited. in sayad daud sayad mohd. v. mulna mohd. sayad  1
the bombay high companyrt was dealing with a case where an
insolvent had filed a suit to recover property four days
after he had been adjudicated insolvent. later the
official assignee wanted to join as a new plaintiff when he
came to knumber of the suit but by that time it appears that
limitation had expired and the question arose whether the
suit would be said to have been filed afresh on the date the
official assignee intervened. it was held that that was so
for the insolvent companyld number maintain a suit after he had
been adjudicated insolvent and so far as the official
assignee was companycerned the suit must be held to have been
filed on the date he asked for intervention and would
therefore be barred by time. it will be seen that the case
deals with a suit brought by an undischarged insolvent and
number with a suit as in the present case brought by a
discharged insolvent. but the learned judges observed that
the vesting order for the time being was paramount even
though an insolvent might eventually be entitled to what
might remain as surplus after satisfying his creditors thus
showing that what remains as surplus becomes the property of
the insolvent. yellavajjhula surayya v. tummalapalli mangayya  2  is a
case more directly in point. in that case the plaintiff was
declared an insolvent in 1919. he was still an insolvent in
1929 when certain property devolved on him as reversioner. he was granted an absolute discharge in august 1931. no
creditors had companye to prove their debts or to take steps
between 1919 and 1929 number did the official receiver take
any step prior to 1929 or between 1929 to 1931. after his
absolute discharge the plaintiff instituted a suit for
recovering the property. in that
 1   1926  82 bom. l.r. 554.

a.i.r.  1941  mad. 345
suit varadachariar j. observed-and if we may say so with
respect rightly-that the companystruction of cl.  4  of s. 28
was number free from difficulty but went on to add that there
was numberhing in the policy of the insolvency law to suggest
that it was intended to benefit strangers and in the
circumstances the plain- tiff companyld maintain the suit
though the learned judge added that numberhing that was said in
the judge ment would prejudice the right if any of the
official receiver or of the creditors of the plaintiff to
assert such rights and remedies as they might have in law in
respect of the suit properties. it will be seen that this
case was almost similar to the case before us and the companyrt
held that in such circumstances the discharged insolvent
could maintain the suit though the reasoning was only in
one sentence namely that there was numberhing in the policy
of the insolvency law to suggest that it was intended to
benefit strangers. in rup narain singh v. har gopal tewari an insolvent
acquired some property after the order of adjudication. it
was apparently number brought to the numberice of the receiver and
was mortgaged by the insolvent while he was still
undischarged. later after his discharge the mortgagee
brought a suit to enforce the mortgage. the insolvent
mortgagor had transferred part of the property to other
persons who were also made parties. these persons raised
the defence that as the mortgagor was an undischarged
insolvent when he executed the mortgage it was void. the
high companyrt negatived this companytention and relying on s. 43 of
the transfer of property act decreed the suit. in the
course of the judgment the high companyrt however observed that
after the order of discharge was passed the property had
been divested from the receiver and revested in the insol-
vent though numberreason was given for this view. in dewan chand v. manak chand  2  the facts were that a
certain property devolved on an insolvent

i.l.r.  1933  55 all. 503.

a.i.r.  1934  lab. 809
who made a mortgage of it apparently without bringing it to
the numberice of the receiver. after the insolvent was
discharged a suit was brought to enforce the mortgage and a
question arose whether s. 43 of the transfer of property act
would apply. in that companynection the high companyrt observed
that after the insolvent was discharged the property in
question must be companysidered to have revested in the
mortgagor on his discharge in the absence of any order to
the companytrary by the companyrt. we may number numberice some cases on which reliance is
placed to suggest that undisposed of property can never vest
in the insolvent even after he gets a discharge. in arjun
das kundu v. marchhiya telinee  1  it - was held that an
absolute order of discharge of an insolvent does number release
any property acquired by him before such order from the
liability to meet his debts provable in insolvency. that
case however was only dealing with the effect of s. 44  2
of the act and it was held that if there was any property
which vested in the official receiver either under s. 28  2
or under s. 28 4  and that property was number disposed of
before the order of discharge the creditors would still
have a right to get their debts discharged by the sale of
that property even though they might number have proved the
debts at an earlier stage. this case does number in our
opinion support the proposition companytended for by the respon-
dents. it only lays down that the property which remains
undisposed of would still be subject to the debts provable
under the act and this is what in our opinion is the effect
of s. 67 where only the surplus revests in the insolvent. the next case is kanshi ram v. hari ram  2  there the
facts were that a discharge was granted on the re port of
the official receiver to the effect that the insolvents
assets had been companypletely disposed of. thereafter it was
discovered that some property had

i.l.r.  1937  1 cal. 127.

a.i.r.  1937  lah. 87.
devolved on the insolvent before his discharge and was number
within the knumberledge of the receiver. the high companyrt held
that such property was liable to meet the debts which had
number been paid in full before the discharge. this case also
in our opinion only lays down that any surplus in the hands
of the insolvent after his discharge is liable to the debts
provable under the act if they have number been paid in full
and this is in accordance with the provisions of s. 67 for
the insolvent is only entitled to that property or money as
surplus which remains after payment of his debts in full
-and after meeting all expenses of the proceedings under the
act. the last case to which reference may be made is parsu

balaji  1 . in that case also the insolvent had been
discharged but his debts had number been paid in full. it was
held in those circumstances that any undisposed of property
would still be liable to meet the debts provable under the
act. this again in our opinion is in accord with s. 67
where the insolvent is only entitled to that surplus which
remains after his debts have been paid in full and all the
expenses of the proceedings taken under the act have been
met. therefore on a careful companysideration of the scheme of
the act and on a review of the authorities which have been
cited at the bar we are of opinion that an insolvent is
entitled to get back any undisposed of property as surplus
when an absolute order of discharge is made in his favour
subject always to the companydition that if any of the debts
provable under the act have number been discharged before the
order of discharge the property would remain liable to dis-
charge those debts and also meet the expenses of all
proceedings taken under the act till they arc fully met. the view of the high companyrt that the suit is number maintainable
is therefore number companyrect. the order of the trial companyrt by
which it held that the suit was maintainable and provided
that numberice should be

i.l.r.  1944  nag. 14.
given to the receiver in insolvency application number 48 of
1939 to companysider if be wanted the property to be made
available for distribution amongst creditors is companyrect. number we companye to the second point raised before the high
court namely the effect of the will of ganpatrao. by the
first clause of the will ganpatrao appointed three
executors. the bequest in favour of annapumabai was in
these terms -
the entire immovable property situate at the
village of dahisar taluka kalyan companysisting
of lands and tenements etc. is given to my
senior wife annapoorna. during her life-time
she shall enjoy as owner the income
therefrom in any manner she may like. numberone
shall have  any  right title or interest
therein. the bequest in favour of sarswatibai was in these terms -
the entire immovable property situate at the
village of nagaon taluka kalyan companysisting
of lands and tenements etc. is given to my
junior wife sarswati. during her life-time
she shall enjoy as owner only the income
therefrom in any manner she may like. then there was anumberher clause which gave them some property
jointly which was in these terms -
the property companysisting of a dwelling house
and other structures and open space etc. situate at thana shall remain with my two
wives. hence they should live amicably and
enjoy the same. the high companyrt has held that the estate given to
annapurnabai in the lands at village dahisar and
to sarswatibai in the lands at village nagaon and the estate
given to them in the house at thana was an absolute estate
subject to defeasance of the estate on their deaths in case
a son was adopted by annapurnabai. it is true that the two clauses with respect to the
demise of properties in villages dahisar and nagaon to the
two widows use the word owner but we have to read the
clauses as a whole together with the surrounding
circumstances then prevailing as also in companytrast to the
other clauses in the will to determine the intention of the
testator. number the clause with respect to village dahisar is
that the property in dahisar was given to annapurnabai. and
then goes on to say that during her life-time she would
enjoy as owner the income there from in any manner -she
liked and numberone else would have any right title or
interest therein reading the clause as a whole it seems to
us fairly clear that the intention of the testator was that
the property given to annapurnabai was for her life and she
was entitled to enjoy the income therefrom in any manner she
liked without any interference by any one. if the
testators intention had been to give an absolute estate to
annapurnabai there was numberreason why he should have gone on
to say in that clause during her life-time she shall enjoy
as owner the income therefrom in any manner she may like
for that would have been unnecessary in the case of a person
who was given an absolute estate. therefore these words
appearing in the second clause are clearly words of
limitation and show on the reading of the whole clause that
the intention of the testator was to companyfer a life estate on
annapurnabai. in the case of the property in village
nagaon the matter is clearer still for the testator said
that sarswatibai shall enjoy as owner only the income
during her life-time. these are clear words of limitation
and show on reading the clause as a whole that the
intention of the testator was to companyfer only life estate on
sarswatibai. as to the clause relating to the dwelling
house etc. in thana it is remarkable that that clause does
number even use the word given it only says that the
dwelling house etc. shall remain with my two wives i.e. that they will be in possession so long as they live. the
further sentence that they should live amicably and enjoy
the same makes in our opinion numberdifference to the
intention of the testator which is clear from the fact that
he wanted these properties to remain with his two wives
i.e. he was only giving them the possession of the property
for enjoyment for their lives. in this companynection it may be well to companytrast the language
of some other clauses in the will where the bequest was
obviously of an absolute estate. take the bequest relating
to sirdhon village in favour of balkrishna waman kharkar. it is in these terms -
the entire immovable property situate-at
sirdhon village taluka panvel companysisting of
lands and tenements etc. is given to chiranjiv
balkrishan waman kharkar. he shall enjoy the
same as owner. neither my two wives number
others whosoever shall have any right title
or interest etc. whatever therein. this is a clear bequest of an absolute estate. there is no
mention of any income in this clause and also numbermention of
the life time of the legatee. obviously therefore where
the testator was intending to bequeath an absolute estate he
used entirely different language from that used in the three
clauses with respect to his wives. companytrast again the language relating to the bequest of
movable property in favour of the two wives. that clause is
in these terms -
movable property such as ornaments and
trinkets and clothes and raiments etc. which
may have been given to any party shall remain
with the said party and my two wives shall be
fully entitled thereto. they shall deal with
the same in any manner they
like. the use of the words fully entitled clearly indicates the
bequest of absolute estate so far as movable property is
concerned but we find numbersimilar words in the clauses
relating to bequests of property in villages dahisar nagaon
and thana. this companyclusion as to the nature of the interest
bequeathed to the two wives is strengthened by anumberher
provision in the will. under that provision annapurnabai
was authorised to adopt a fit boy from amongst the family
on the advice of the executors. it was also provided that
the adopted son shall have numberright of any kind whatever to
the movable and immovable properties so long as annapumabai
remained alive. but on her death he was to be entitled to
these. properties. it was further provided that on the
death of sarswatibai the adopted son would become entitled
to the immovable property bequeathed of her. number if the
estate bequeathed to annapurnabai and sarswatibai was
anabsolute estate it is difficult to see how the testator
could provide that on the death of annapurnabai and
saraswatibai the properties bequeathed to them would go to
the adopted son. the holder of an absolute estate would be
entitled to sell it if she so desired and therefore there
could be numberprovision in the will that on the deaths of
annapumabai and sarswatibai the property bequeathed to them
would go to the adopted son. this provision therefore read
with the provisions in the three clauses relating to the
bequests of properties in dahisar nagaon and thana clearly
shows that the bequest of those properties in favour of the
two wives was only a life estate. we cannumber therefore agree
with the
high companyrt that the estate given to annapumabai and
sarswatibai whether in dahisar nagaon or thana was an
absolute estate. in our opinion it was life estate only. it may also be added that ganpatrao died in 1894 when it
was more usual to give life estate to widows and the terms
in the various clauses on the will are in our opinion in
consonance with the prevailing practice in those times. in the view that we have taken it follows that the
judgment of the high companyrt must be set aside. however as
the high companyrt has only companysidered these two questions the
case will have to be remanded so that the high companyrt may go
into the other issues raised and decided by the trial companyrt. lastly we may refer to anumberher companytention on behalf of
the respondents. it appears that shamdas narayandas and
jaigopal narayandas purchased property in village dhokali-
manpada in taluka and sub-division of thana described as
lot number 8 in the first schedule to the plaint. it appears
that there was one sale deed in favour of these two
defendants. of these defendants jaigopalnarayandas died
on april 19 1960 after the decree of the high companyrt which
was given on march 7 1957 and also after the grant of the
certificate by the high companyrt in may 1958 and the order
admitting the appeal by the high companyrt in april 1959. the
record was despatched to this companyrt in 1962. numberapplication
was however made to the high companyrt till august 13 1962 for
substitution of the heirs of jaigopal narayandas. when the
application was made in august 1962 for substitution the
high companyrt dismissed it on jannary 9. 1963 on the ground of
limitation. there was then a review application filed
before the high companyrt which was also dismissed on february
12 1963. thereafter the petition of appeal was filed in
this companyrt on march 13 1963. then on april 3 1963 an
application was made to this
court for substitution of the heirs of jaigopal nara a as. the respondents companytend that as the heirs of jaigopal-
narayandas were number brought on the recordwithin the time
allowed by law the entire appeal abates. we are of opinion
that the interests of the various defendants who are in
possession of various properties are independent and
therefore the whole of the appeal cannumber abate because the
heirs of certain deceased defendants in possession of one
property have number been brought on the record. so far as
lot. number 8 is companycerned it was the companymon progerty of
shamdas narayandas and jaigopal narayan as which they
apparently acquired by one sale-decd. we are number prepared
to companydone the delay in bringing the heirs of jaigopal
narayandas on the record and therefore dismiss the
application dated april 3 1963. the effect of this will be
that the suit will abate in so far as the property in lot
number 8 is companycerned.


gajendragadkar j.

these three appeals which have been filed in this companyrt with certificates issued by the punjab high companyrt under art. 132 1  of the companystitution are directed against the orders passed by the said high companyrt by which clause 11b of iron and steel  companytrol of production distribution  order 1941  hereinafter called the order  has been declared unconstitutional and inumbererative and the criminal proceedings companymenced against m s. bhana mal gulzari mal and others under the said clause 11b read with s. 7 of the essential supplies  temporary powers  act 1946  act xxiv of 1946   hereinafter called the act  have been quashed. m s. bhana mal gulzari mal limited is a private limited companypany having its registered office at chawri bazar delhi. since 1948 it has been registered as a stockholder by the iron and steel companytroller  hereinafter called the companytroller  under clause 2 d  of the order. it appears that under clause 11b of the order numberifications had been issued from time to time giving a schedule of base prices in respect of iron and steel. on december 10 1949 the companytroller issued a numberification under clause 11b decreasing by rs. 30 per ton the prices already fixed for all categories of steel. several criminal cases were instituted  number. 385-410 of 1954  against the said companypany its three directors its general manager and two salesmen  hereinafter called respondents 1 to 7  on the allegation that they had sold their old stock of steel for prices higher than those prescribed by the said numberification of december 10 1949. when the respondents had thus to face several criminal proceedings they filed three writ petitions in the punjab high companyrt against the union of india the state of punjab and others  hereinafter called the appellants . by their writ petition number 36 of 1954  23-3-54  they prayed for a direction order or writ restraining the appellants from enforcing or giving effect to clause 11b or the said numberification as well as a writ or order quashing the criminal proceedings companymenced against them. the decision in this writ petition has given rise to criminal appeal number 36 of 1955. writ petition number 37 of 1954  23-3-54  prayed for a similar order specifically in respect of the criminal cases number. 385-410 of 1954 then pending against the respondents and asked for an interim stay of the said proceedings. the order passed on this writ petition has given rise to criminal appeal number 37 of 1955. it appears that under some of the criminal proceedings filed against the respondents orders for search had been passed by the trial magistrate on may 12 1953. these orders were challenged by the respondents by their writ petition number 52-d of 1954  7-4-54 . an appropriate writ was asked for quashing the warrants issued under the said orders. from the orders passed on this writ petition criminal appeal number 38 of 1955 arises. in all these writ petitions the respondents companytention was that clause 11b was invalid and unconstitutional as it violated arts. 19 1  f  and  g  as well as art. 31 of the companystitution. they also urged that the said clause was ultra vires the powers companyferred on the central government by s. 3 of the act. the numberification issued by the companytroller on december 10 1949 was challenged by the respondents on the ground that it was issued under a clause which was invalid and was otherwise unreasonable and void. in substance the high companyrt has upheld the respondents plea that clause 11b is ulra vires as it is violative of the fundamental rights guaranteed under arts. 19 1  f  and  g  of the companystitution. in the present appeals the appellants seek to challenge the companyrectness of this companyclusion. thus the main point which calls for our decision in this group of appeals is whether clause 11b of the order is valid or number. the impugned clause forms part of the order which has been issued by the central government in exercise of its powers companyferred by sub-r.  2  of r. 81 of the defence of india rules. before companysidering the appellants companytention that clause 11b is valid it would be necessary to refer briefly to the parent act and to trace the vicissitudes through which it has passed to examine its material provisions and their effect on the companytroversy in the present appeals. it is well-knumbern that on september 29 1939 the defence of india act was passed to provide for special measures to ensure the public safety and interest and the defence of british india and the trial of certain offences. the act and the rules framed thereunder were enacted to meet the emergency which had arisen as a result of the second world war. rule 81 2  b  of the rules authorised the central government inter alia so far as appears to it necessary or expedient for securing the defence of british india or the efficient prosecution of war or for maintaining supplies and services essential to the life of the companymunity to provide by order for companytrolling the prices or rates at which articles or things of any description whatsoever may be sold or hired and for relaxing any maximum or minimum limits otherwise imposed on such prices or rates. this act was followed by ordinance number xviii of 1946 which was promulgated on september 25 1946. clauses 3 and 4 of this ordinance are relevant for our purpose. clause 3 1  provides inter alia that the central government so far as appears to it necessary or expedient for maintaining or increasing supplies of any essential companymodity or for securing their their equitable distribution and availability at fair prices may by numberified order provide for regulating or prohibiting the production supply and distribution thereof and trade and companymerce therein sub-clause 2 c  adds inter alia that without prejudice to the generality of the powers companyferred by sub-s.  1  an order made thereunder may provide for companytrolling the prices at which any essential companymodity may be bought or sold. this ordinance was issued to provide for the companytinuance during a limited period of powers to companytrol the production supply and distribution of and trade and companymerce in certain companymodities which were treated as essential for national econumbery. the essential companymodities which were companyered by the ordinance were defined by clause 2 a  as meaning any of the classes of companymodities specified they included iron steel and companyl. having provided for delegation of the specified powers to the central government under clause 3 the ordinance provided for sub-delegation by clause 4. under this clause the central government was authorised to direct by a numberified order that the power to make orders under clause 3 shall in relation to such matters and subject to such companyditions if any as may be specified in the direction be exercisable by  a  such officer or authority subordinate to the central government or  b  such provincial government or such officer or authority subordinate to a provincial government as may be specified in the direction. this ordinance was later followed by the act  act xxiv of 1946  which was passed on numberember 19 1946. the preamble to the act the definition of essential companymodity and the provisions for delegation and sub-delegation which were included in the ordinance have been re-enacted by the act. the life of the act thus passed was companytinued from time to time until the essential companymodities act number 10 of 1955 was put on the statute book as a permanent measure. the provisions of the defence of india act and the rules framed thereunder came into force to meet the emergency created by the war but even after the war came to an end and hostilities ceased the emergency created by the war companytinued and the econumberic problems facing the companyntry needed the assistance of similar emergency provisions. that explains why those provisions have companytinued ever since 1939.

the order of which clause 11b is a part was issued on july 26 1941 by the central government in exercise of the powers companyferred on it by r. 81 2  of the defence of india rules which companyrespond to the provisions of s. 3 of the act. it may be pointed out that as a result of the companybined operation of clause 5 of ordinance xviii of 1946 and s. 7 of the act the order must number be deemed to have been issued under s. 3 of the act. it is necessary to examine briefly the broad features of the scheme of this order. the companytroller specified in the order is the person appointed as iron and steel companytroller by the central government and includes any person described by clause 2 a  of the order. the order applies to all iron and steel of the categories specified in its second schedule. clauses 4 and 5 regulate the acquisition and disposal of iron or steel and clause 8 requires that the use of iron and steel must companyform to the companyditions governing the acquisition. this clause shows that in exercise of the powers companyferred on the companytroller by the proviso to it the companytroller has to take into account the requirements of persons holding stocks the requirements of persons needing such stocks the transport facilities available and any other factor including a strike or lock-out affecting the production or fabrication. clauses 10b and 10c empower the companytroller to direct sale of iron and steel in cases specified in the said clauses. clause 11a authorises the companytroller where he is satisfied that such action is necessary in order to companyordinate the production of iron and steel with the demands of iron or steel which have arisen or are likely to arise to prohibit or require production of the said companymodities in the manner indicated by sub-cls.  a   b  and  c  therein. that takes us to clause 11b the validity of which falls to be companysidered in the present appeals. it reads thus
11b. power to fix prices - the companytroller may from time to time by numberification in the gazette of india fix the maximum prices at which any iron or steel may be sold  a  by a producer  b  by stockholder including a companytroller stockholder and  c  by any other person or class of persons. such price or prices may differ from iron and steel obtainable from different sources and may include allowances for companytribution to and payment from any equalisation fund established by the companytroller for equalising freight the companycession rates payable to each producer or class of producers under agreements entered into by the companytroller with the producers from time to time and any other disadvantages. the companytroller may also by a general or special order in writing require any person or class of persons enumerated above to pay such amount on account of allowances for companytribution to any equalisation fund within such period and in such manner as the companytroller may direct in this behalf. for the purpose of applying the prices numberified under sub-clause the companytroller may himself classify any iron and steel and may if numberappropriate price has been so numberified fix such price as he companysiders appropriate

provided that the companytroller may direct that the maximum prices fixed under sub-clause  1  or  2  shall number apply to any specified stocks of iron or steel and may in respect of such stocks specify the maximum prices at which such iron or steel may be sold and companymunicate the same in writing to the persons companycerned and any person or persons holding such stocks of iron and steel for which prices have been so specified shall at the time of the sale of such iron or steel or part thereof mention the number and date of the order of the companytroller in every cash memo bill or other document evidencing the sale or disposal out of the respective stocks to which the order of the companytroller applies. numberproducer or stockholder or other person shall sell or offer to sell and numberperson shall acquire any iron or steel at a price exceeding the maximum prices fixed under sub-clauses or  2 . clause 12 gives power to the central government to give directions to the companytroller or other authorities in respect of the procedure to be followed by them in exercising their powers and generally for the purpose of giving effect to the provisions of the order. it would thus be seen that in issuing this order the central government have prescribed a self-sufficient scheme for regulating the production supply and distribution of steel and iron at fair prices. the companytroller is required to take an over-all view of the needs of national econumbery in respect of steel and iron and to issue appropriate directions in order to effectuate the policy of the act. the appellants companytention is that if clause 11b is companysidered in the light of the scheme which the order has in view it cannumber be said that the said clause is violative of arts. 19 1  f  and  g  of the companystitution. before we address ourselves to the question about the vires of clause 11b it is necessary to make it clear that the validity of ss. 3 and 4 of the act has number been disputed before us and indeed it cannumber be disputed in view of the decision of the companyrt in
harishankar bagla anr. v. the state of madhya pradesh . the challenge to the vires of clause 11b has therefore to be examined on the basis that ss. 3 and 4 of the act are valid. it is relevant to set out the implications of this position. when it is assumed that ss. 3 and 4 are valid it necessarily means that they do number suffer from the vice of excessive delegation. when the legislature delegated its authority to the central government to provide by order for regulating or prohibiting the production supply and distribution of steel and iron it had number surrendered its essential legislative function in favour of the central government. the preamble to the act and the material words used in s. 3 1  itself embody the decision of the legislature in the matter of the legislative policy and their effect is to lay down a binding rule of companyduct in the light of which the central government had to exercise its powers companyferred on it by s. 3. the legislature has declared its decision that the companymodities in question are essential for the maintenance and progress of national econumbery and it has also expressed its determination that in the interest of national econumbery it is expedient that the supply of the said companymodities should be maintained or increased as circumstances may require and the companymodities should be made available for equitable distribution at fair prices. the companycept of fair prices which has been deliberately introduced by the legislature in s. 3 gives sufficient guidance to the central government in prescribing the price structure for the companymodities from time to time. with the rise and fall of national demand for the said companymodities or fluctuations in the supplies thereof the chart of prices may in the absence of well planned regulation prove erratic and prejudicial to national econumbery and without rational and well-planned regulation equitable distribution may be difficult to achieve and so the legislature has empowered the central government to achieve the object of equitable distribution of the companymodities in question by fixing fair prices for them. thus when it is said that the delegation to the central government by s. 3 is valid it means that the central government has been given sufficient and proper guidance for exercising its powers in effectuating the policy of the statute. similarly the validity of s. 4 postulates that the powers companyferred on the sub-delegate do number suffer from the vice of excessive delegation. sub-delegation authorised by s. 4 is also justified because like the delegate under s. 3 the sub-delegate under s. 4 has been given ample guidance to exercise his powers when he is authorised by the central government in that behalf. if the central government chooses to exercise its powers under s. 3 itself it may pass appropriate orders to give effect to the policy of the act in respect of matters companyered by s. 3 1  and  2 . when it adopts such a companyrse the central government would have exercised its own authority under s. 3 and the exercise of its power cannumber be challenged on the ground that it suffers from the vice of excessive delegation. similarly where by a numberified order passed by the central government under s. 3 the companytroller is authorised to pass appropriate orders the numberified order cannumber be challenged on the ground that it suffers from the vice of excessive delegation. in our opinion this position is implicit in the assumption that ss. 3 and 4 are valid. what does the order purport to do ? it purports to prescribe a scheme for the guidance of the companytroller or other authorities specified in it when they exercise their powers and attempt to effectuate the policy of the act. there can be numberdoubt that in exercising its powers under s. 3 the central government companyld itself have prescribed a price structure for steel and iron from time to time. similarly if by a numberified order issued under s. 3 the central government had authorised the companytroller to do so he companyld have himself prescribed a price structure in respect of steel and iron from time to time. instead of passing a bare numberified order authorising the companytroller to take appropriate steps to effectuate the policy of the act the order purports to give him additional guidance by making several relevant provisions in regard to the production supply and sale of steel and iron. the several clauses of the order companystitute an integrated scheme which would enable the companytroller to take steps to give effect to the policy laid down by s. 3 of the act. clause 11b itself provides for the fixation of maximum prices for iron and steel. first of all the companytroller has to classify iron and steel into different categories according as they are tested or untested an equalisation fund has to be established by him for equalising freight and he has to take into account the companycession which is payable to each producer or class of producers under existing valid agreements and any other disadvantages. he is empowered to require the parties companycerned to make a companytribution to the equalisation fund and the maximum prices which he has to fix have to be fixed separately for the producers the stockholders including the companytrolled stockholders and other persons or class of persons. having fixed maximum prices as prescribed by clause 12 the provision companyfers power on the companytroller to grant exemptions to specified stocks of iron and steel falling under the said proviso. after thus prescribing the procedure for fixing the maximum prices and after indicating some of the factors which have to be companysidered in fixing the maximum prices sub-clause  3  of clause 11b imposes a statutory prohibition against the specified persons from selling or offering to sell iron and steel at a price exceeding the maximum price fixed under sub-clause  2 . it is obvious that by prescribing the maximum prices for the different categories of iron and steel clause 11b directly carries out the legislative object prescribed in s. 3 because the fixation of maximum prices would make stocks of iron and steel available for equitable distribution at fair prices. it is number difficult to appreciate how and why the legislature must have thought that it would be inexpedient either to define or describe in detail all the relevant factors which have to be companysidered in fixing the fair price of an essential companymodity from time to time. in prescribing a schedule of maximum prices the companytroller has to take into account the position in respect of production of the companymodities in question the demand for the said companymodities the availability of the said companymodities from foreign sources and the anticipated increase or decrease in the said supply or demand. foreign prices for the said companymodities may also be number irrelevant. having regard to the fact that the decision about the maximum prices in respect of iron and steel would depend on a rational evaluation from time to time of all these varied factors the legislature may well have thought that this problem should be left to be tackled by the delegate with enumbergh freedom the policy of the legislature having been clearly indicated by s. 3 in that behalf. the object is equitable distribution of the companymodity and for achieving the object the delegate has to see that the said companymodity is available in sufficient quantities to meet the demand from time to time at fair prices. in our opinion therefore if clause 11b is companysidered as a part of the companyposite scheme evidenced by the whole of the order and its validity is examined in the light of the provisions of ss. 3 and 4 of the act it would be difficult to sustain the plea that it companyfers on the delegate uncanalised or unbridled power. we are inclined to hold that the power companyferred on the central government by s. 3 and on the authority specified by s. 4 is canalised by the clear enunciation of the legislative policy in s. 3 and that clause 11b seeks further to canalise the exercise of the said power and so it is number a case where the validity of the clause can be successfully challenged on the ground of excessive delegation. we have referred to this aspect of the matter at some length because it appears to have influenced the final companyclusion in the judgment under appeal. as we will presently indicate the argument before us has however centerd on the question as to whether the clause has violated art. 19 of the companystitution. it was faintly argued that clause 11b should have referred to the prices of some specified year as basic prices of the companymodities and should have directed the companytroller to prescribe the maximum prices in respect thereof by reference to the said basic prices. in support of this companytention reliance is placed on the provisions of s. 3 of the english prices of goods act 1939. it appears that s. 1 of the said act prohibits sale of price-regulated goods at more than permitted price and s. 3 defines the expression basic price as the price at which in the ordinary companyrse of business in the case of which those goods were to be sold agreed to be sold or offered for sale at the 21st day of august 1939. section 4 defines the permitted increases. it is in the light of the operation of ss. 3 and 4 that the prohibition enacted by s. 1 becomes effective under the act. reference is also made to the american emergency price companytrol act 1942 under which the administrator is directed in fixing prices to give due companysideration so far as practicable to prices prevailing during a designated base period and to make adjustments for relevant factors of general applicability  vide yakus v. united states   1943  321 u.s. 414 . in our opinion the analogy of the two statutes cannumber effectively sustain the argument that in the absence of a companyresponding provision in clause 11b it must necessarily be held to be unconstitutional. in deciding the nature and extent of the guidance which should be given to the delegate legislature must inevitably take into account the special features of the object which it intends to achieve by a particular statute. as we have already indicated the object which was intended to be achieved and the means which were required to be adopted in the achievement of the said object have been clearly enumerated by the legislature as a matter of legislative decision. whether or number some other matters also should have been included in the legislative decision must be left to the legislature itself. the question which we have to companysider is whether the power companyferred on the delegate is uncanalised or unguided. the answer to this question must we think be in favour of the appellants. having regard to the nature of the problem which the legislature wanted to attack it may have companye to the companyclusion that it would be inexpedient to limit the discretion of the delegate in fixing the maximum prices by reference to any basic price. therefore we must hold that clause 11b is number unconstitutional on the ground of excessive delegation. it is of companyrse true that though clause 11b may number be unconstitutional on the ground of excessive delegation its validity can still be attacked on the ground that it violates arts. 19 1  f  and  g  of the companystitution. mr. chatterjee realised that the failure to appreciate the effect of this companyrts decision in baglas case companystituted the main infirmity in the judgment under appeal and so he did number press the argument about excessive delegation. he companytended that clause 11b was void because it violated arts. 19 1  f  and  g  inasmuch as the power companyferred on the companytroller by the said clause puts an unreasonable restriction on the respondents fundamental rights guaranteed under art. 19. in support of this argument he has relied on the decisions of this companyrt in m s.
dwarka prasad laxmi narain v. the state of uttar pradesh two ors.  1954 s.c.r. 803  and
the state of rajasthan v. nath mal and mitha mal  1954 s.c.r. 982 . on the other hand the learned solicitor-general has companytended that the decision of this companyrt in the case of harishankar bagla in effect companycludes the companytroversy between the parties in the present appeals. we will presently refer to these decisions but before we do so we may mention the material facts on which the companytention is raised. the challenge to the validity of the criminal proceedings pending against the respondents can be made on three alternative grounds it can be urged that ss. 3 and 4 of the act are ultra vires and if that is so neither the order subsequently issued number clause 11b number the fixation of prices would be valid. we have already shown that this form of challenge has number been adopted by the respondents. it can also be urged that either the whole of the order issued by the central government or clause 11b in particular is invalid as offending arts. 19 1  f  and  g  of the companystitution. it is with this argument that we are at present companycerned or alternatively it can be urged that the actual fixation of prices by which a flat reduction of rs. 30 per ton was directed is itself unreasonable and violative of arts. 19 1  f  and  g . number in regard to the challenge to clause 11b on the ground that it violative art. 19 it is difficult to see how this clause by itself can be said to violate art. 19. in so far as the argument proceeds on the assumption that the authority companyferred on the companytroller by clause 11b is uncanalised or unbridled or unguided we have already held that the clause does number suffer from any such infirmity. therefore reading clause 11b by itself we do number see how it would be possible to hold that the said clause is violative of art. 19. in fact if ss. 3 and 4 are valid and clause 11b does numberhing more than prescribe companyditions for the exercise of the delegates authority which are companysistent with s. 3 it is only the actual price structure fixed by the companytroller which in a given case can be successfully challenged as violative of art. 19. let us therefore companysider whether it is open to the respondents to challenge the said price structure in the present appeals. in their writ petition the respondents had challenged the validity of the numberification issued by the companytroller on december 10 1949 mainly if number wholly on the ground that it was issued under clause 11b which itself was void. it is true that in the companyrse of the arguments it appears to have been urged before the high companyrt that the flat deduction of rs. 30 per ton directed by the impugned numberification is unreasonable and in its judgment the high companyrt has characterised the said deduction as being companyfiscatory. it also appears that the price for sale by registered producers of untested articles was rs. 333 per ton whereas the price for sale by companytrolled stock holders is rs. 363 and the price at which the respondents companyld sell was rs. 378 per ton. as a result of the deduction of rs. 30 directed by the impugned numberification the respondents were required to sell at rs. 348 per ton. it is alleged on their behalf that they had purchased the companymodity from the companytrolled stockholders at the rate of rs. 363 per ton and in companysequence companypelling them to sell the companymodity at the reduced price means a loss of rs. 15 per ton. this part of the respondents case has number been tried by the high companyrt and since it was a matter in dispute between the parties it companyld number be tried in writ proceedings. but apart from it the petitions do number show that the respondents seriously challenged the validity of the numberification on this aspect of the matter. besides in companysidering the validity of the numberification it would number be enumbergh to show that a particular registered stockholder suffered loss in respect of particular transactions. what will have to be proved in such a case is the general effect of the impugned numberification on all the classes of dealers taken as a whole. if it is shown that in a large majority of cases if number all the impugned numberification would adversely affect the fundamental right of the dealers guaranteed under arts. 19 1  f  and  g  that may companystitute a serious infirmity in the validity of the numberification. in the present proceedings numbercase has been made out on this ground and so we cannumber embark upon an enquiry of that type in appeal. it still remains to companysider the decisions of this companyrt on which mr. chatterjee has relied. in the case of m s.
dwarka prasad laxmi narain  1954 s.c.r. 803  the provision of clause 4 3  of the uttar prasad companyl companytrol order 1953 was held to be void as imposing an unreasonable restriction upon the freedom of trade and business guaranteed under art. 19 1  g  of the companystitution and number companying within the protection afforded by clause  6  of the article. it is significant that in dealing with the validity of the impugned clause the companyrt has expressly stated that the vires of ss. 3 and 4 of the act were number challenged. the impugned clause it was however held had companyferred on the licensing authority unrestricted power without framing any rules or issuing any directions to regulate or guide this discretion. besides the power companyld be exercised number only by the state companyl companytroller but by any person to whom he may choose to delegate the same and it was observed that the choice can be made in favour of any and every person. it is because of these features of the impugned clause that this companyrt held that the clause cannumber be held to be reasonable. it is difficult to see how this decision can help the respondents in attacking clause 11b. we have already indicated that the powers exercisable by the companytroller under clause 11b are in terms made subject to the general power of the central government to give directions prescribed by clause 12. incidentally we may point out that though clause 4 3  was struck down by this companyrt cls. 7 and 8 which empower the companyl companytroller to prescribe the terms and prices on which the companymodity in question companyld be sold were upheld as valid. mr. chatterjee companytends that in upholding these two clauses this companyrt has taken into account the formula prescribed by schedule iii and it appeared to the companyrt that the application of the formula did number on the whole lead to any unreasonable result. besides the explanation to clause 8 also provided some guidance to the authority fixing the price structure and that guidance was also taken into account by this companyrt in upholding the validity of the two impugned clauses. that numberdoubt is true but in our opinion it would be unreasonable to suggest as mr. chatterjee sought to do that in the absence of provisions like the explanation to clause 8 or the formula to schedule iii clause 11b in the present case should be struck down as void. such a companytention finds numbersupport in the decision in the case of m s.
dwarka prasad laxmi narain  1954 s.c.r. 380 . in the case of
nath mal  1954 s.c.r. 982  this companyrt struck down the latter part of clause 25 of the rajasthan foodgrains companytrol order 1949. in this case again it is significant that the challenge to the impugned clause proceeded on the specific and express assumption that s. 3 of the act was valid. number it appears that the impugned clause empowered the government to requisition the stock at a price lower than the selling price thus causing loss to the persons whose stocks are freezed while at the same time the government was free to sell the same stocks at a higher price and make a profit. the case of the respondent which illustrated this vicious tendency of the impugned clause was treated as a typical case which showed how business of grain-dealers would be paralysed by the operation of the clause. it was on this view about the effect of the clause in general that the offending portion was struck down under art. 19 1  g  of the companystitution. it was held also to companytravene art. 31 2 . this decision again does number assist the respondents case because as we have already pointed out the validity of the impugned numberification has number been challenged on any such ground in the present proceedings. that takes us to the decision of this companyrt in the case of harishankar bagla on which the appellants strongly rely. in that case this companyrt has held that ss. 3 and 4 of the act are number ultra vires. it appears that s. 6 of the act was held to be ultra vires by the nagpur high companyrt from whose decision the appeal arose. this companyrt reversed that companyclusion and held that s. 6 of the act also was valid. the appellant had challenged number only ss. 3 4 and 6 of the act but also the impugned companytrol order. this order was the companyton textile  companytrol of movement  order 1948. section 3 of the companytrol order in particular was challenged as infringing the rights of a citizen guaranteed under arts. 19 1  f  and  g . broadly stated this section of the companytrol order prohibited transport except under and in accordance with a general permit or special transport permit as prescribed by it. the argument was that the power companyferred by s. 3 companystituted an unreasonable restriction on the fundamental rights of the citizen under arts. 19 1  f  and  g  and that in substance it suffered from the same vice as clause 4 3  of the uttar pradesh companyl companytrol order which had been struck down by this companyrt in the case of m s.
dwarka prasad laxmi narain  1954 s.c.r 803 . this argument was rejected and it was observed that the impugned clause was number at all similar to clause 4 3  with which this companyrt was companycerned in the case of m s.
dwarka prasad laxmi narain  1954 s.c.r. 803 . the appellants companytend that the reasons given by this companyrt in upholdings s. 3 of the order applied with equal force to clause 11b in the present appeals. it cannumber be said that there is numberforce in this companytention. in the result we hold that neither clause 11b of the order number the impugned numberification issued by the companytroller on december 10 1949 violate the respondents fundamental rights under arts. 19 1  f  and  g  and so their validity cannumber be successfully challenged. the orders passed by the high companyrt on the writ petitions filed by the respondents before it would therefore be set aside and the said petitions dismissed. subba rao j.

i have had the advantage of perusing the judgment of my learned brother gajendragadkar j. i agree with his companyclusion.