calcutta metropolitan area for companysumption use or sale
therein from any place outside that area taxes on entry of
goods into calcutta metropolitan area rules 1970 were
framed. the act of 1970 was repealed by the taxes on entry
of goods into calcutta metropolitan area ordinance 1972 but
the rules 1970 were companytinued in operation by s. 1 3  of the
ordinance. this ordinance was repealed and replaced by the
taxes on entry of goods into calcutta metropolitan area act
1972. section 37  2  of this act provides that anything done
or any action taken under the ordinance of 1972 shall be
deemed to have been validly done or taken under this act as
if this act had companymenced on the 16th day of numberember 1970
 the day when the act of 1970 came into force . under r. 12 1  of the rules of 1970 for the purpose of
determining the value of the goods every dealer has to make
a declaration regarding their value in a prescribed form and
submit the same to the assessing officer alongwith a companyy of
the relevant documents in support thereof. rule 12 2
provides that if the assessing officer is satisfied about
the reasonableness of the value declared by the dealer he
shall accept the same and levy tax accordingly. it further
provides that if the value is number ascertainable on account
of number-availability or number-production of the documents or
if the assessing officer is number satisfied about the
reasonableness of the value declared by the dealer the
assessing officer shall determine the approximate saleable
value of the goods in the calcutta metropolitan area to the
best of his judgment and tax accordingly. the appellant in the civil appeal and the petitioner in
the writ petition is one and the same companypany. the companypany
which used to import horlicks powder manufactured at its
factory in punjab into calcutta metropolitan area
for purposes of bottling and marketing both inside and
outside that area imported 8736 kgs. of that powder in 18
steel drums of 182 kgs. each in 1974. the entry tax officer
at the hussenabad road check post assessed and charged entry
tax on this powder under s.6 1  of the taxes on entry of
goods into calcutta metropolitan area act 1972. the
assessing officer did number accept the declaration and the
documents regarding the value freight and insurance
submitted by the companypany under r. 12 1  of the taxes on
entry of goods into calcutta metropolitan area rules 1970
and made assessment on the best judgment basis under r.12
 2 . the original documents regarding the value freight and
insurance were number produced by the companypany before the
assessing officer in spite of repeated reminders. on appeal before the second respondent assistant
director entry tax government of west bengal it was
contended that  1  rules of 1970 framed under the act of
1970 cannumber be applied for the purpose of the act of 1972
and  2  as the declaration regarding the value of the goods
was submitted and the documents were shown to the assessing
officer he should have proceeded in accordance with s.
14 1  of the act of 1972 and since there was numberomission or
failure on the part of the companypany there was numberscope for
determining the value of the powder on the best judgment
basis under r. 12 2  of the rules of 1970. the assistant
director dismissing the appeal observed that s.1  3  of the
ordinance of 1972 and s. 37 2  of the act of 1972 provided
for companytinuance of the operation of the rules of 1970 and
those provisions companyld be validly applied under the act of
1972 since the value declared by the companypany was much less
than the market value and also far below the value accepted
by the excise authorities as ascertained while the product
came out of the factory the assessing officer proceeded to
ascertain the value on the approximate saleable value of the
goods in the calcutta metropolitan area the value
ascertained by the assessing officer companyld number be said to be
arbitrary. the companypany filed a writ petition in the high companyrt
challenging the assessment under r. 12  2  and the number-
acceptance by the assessing officer of the value of the
goods declared by the companypany. the high companyrt set aside the
assessment order and directed fresh assessment to be made. aggrieved by the fresh assessment made the companypany filed
several appeals before the second respondent who companyfirmed
the assessment in most of the cases by his order dated
september 25 1979. the appeal is against that order. the
writ petition has been filed by the companypany for quashing
this order and some numberices regarding making fresh
assessments and restraining the respondents from levying or
demanding entry tax on a basis other than the value declared
by the companypany at the check post. the companypany companytended  1  though s. 1  3  of the
ordinance of 1972 provided for the companytinued operation of
the rule of 1970 there was numberprovision in the act of 1972
providing for the companytinued operation of the rule of 1970
and as the ordinance of 1972 ceased to be operative the
assessing officer companyld number report to r 12 2  and adopt the
best judgment method for ascertaining the value of the
goods  2  the assessing officer was bound to accept the
value declared by the companypany and proceed in accordance
with r. 12 1  the horlicks powder arriving at the
hussenabad check post in steel drums companytaining 182 kgs. each had numberother value except the companyt of its manufacture
freight and insurance that they had throughout submitted
requisite declaration together with the relevant documents
and the value declared was accepted and  3  however
towards the latter part of april and early part of may 1974
the respondent declined to issue transport passes under s.
21 of the act of 1972 in respect of horlicks powder which
was number intended for sale use or companysumption within the
calcutta metropolitan area and sought to levy tax thereon. therefore the companypany filed a writ petition in the calcutta
high companyrt and obtained interim injunction in retaliation
the entry tax officer declined to accept the companypanys
declaration of value. dismissing both appeal and the writ petition

held 1. section 1 3  of the ordinance of 1972 stated
that any rule or order made any numberification issued any
direction given anything done or any action taken under any
of the provisions of the act of 1970 shall on the cessor of
operation of that act companytinue to be in force and shall be
deemed to have been made issued given done or taken under
the companyresponding provisions of the ordinance of 1972.
section 37 2  of the act of 1972 lays down that anything
done or any action taken under the ordinance of 1972 shall
be deemed to have been done under the act of 1972 as if that
act had been passed on the 16th of numberember 1970 on which
date the act of 1970 came into force. though s. 36 of the
act of 1972 empowers the state government to make rules for
carrying out the provisions of that act numberfresh rules have
been framed in exercise of that power and only some
amendments have been made to certain rules of the rules of
1970 from time to time in exercise of the power companyferred by
s. 36 of the act of 1972. therefore it is clear that the
rules of 1970 have been kept alive by the provisions of s.
1 3  of the ordinance and s. 37 2  of the act of 1972 and
that it is open to the entry tax officer to resort to the
best judgment method for ascertainment of the value of the
goods under r. 12 2  provided the requirements thereof are
satisfied namely that the value is number ascertainable on
account of number-availability or number-production of the bill or
invoice or companysignment numbere issued by the companysignumber or other
documents of like nature or that the assessing officer is
number satisfied about the reasonableness of the value shown or
declared by the dealer. 766 c-h

it is number possible to accept the companypanys
contention that the horlicks powder packed in steel drums
containing 182 kgs. each had numbervalue at the hussenabad
check post apart from the companyt of manufacture freight and
insurance. that may be so from the point of view of the
manufacturer but it cannumber be the value of the goods in the
calcutta metropolitan area where the value should include in
addition to the aforesaid items the companyt of further
transport into the calcutta market area from the hussenabad
check post excise duty if number already paid at the time of
removal of the goods from the factory wholesalers and
retailers profits and sales-tax. under r. 12 1  the value
declared must include companyt price of the goods as given in
the bill invoice or companysignment numbere or any other document
of like nature shipping duties where applicable insurance
excise duty and sales tax. it may be that
the process of bottling and labelling is resorted to after
the bulk companysignment is received into the calcutta
metropolitan area for the purpose of companyvenience and it may
also be that it may number form part of the value of the goods
at the point of entry. the companyt of bottling and labelling
the horlicks powder into unit bottles inside the calcutta
metropolitan area would be negligible. it may be that the
company may be entitled to ask the assessing officer to take
that also into companysideration in the case of assessment under
r. 12 1 . but since the value declared by the companypany was
far less than the value shown by the companypany itself in form
v as well as the value shown for the unit bottles in the
price list of the companypanys selling agent in the calcutta
metropolitan area it is number possible to hold that the
assessing officer was number justified in rejecting the value
declared by the companypany and resorting to ascertainment of
the assessable value on the best judgment basis as
provided for in r. 12 2  on the basis of the approximate
assessable value of the goods in the calcutta metropolitan
area. 768 b-g

there is numbermaterial to hold that the assessing
authority had any bias against the companypany. the assessing
officer had sufficient reason for number accepting the
companys declaration regarding the value of the goods and
his assessment of the saleable value on the best judgment
basis is rational and based on the companypanys own selling
agents price list in the calcutta metropolitan area. 769
e-f
commissioner of income tax west bengal v. padamchand
ramgopal 1970 76 i.t.r. 719 held inapplicable. haji lal mohd. biri works allahabad v. the state of

p. ors. 1974 1 s.c.r. 25 referred to. civil appellate original jurisdiction civil appeal
number 861  n  of 1980.
appeal by special leave from the judgment and order
dated the 25th september 1979 of the assistant director
entry tax government of west bengal in appeal case number 3970
h of 1976-77.
with
writ petition number 1415 of 1979
 under article 32 of the companystitution of india
shankar ghosh a.c. gulati b.b. sawhney and p.b. ghosh
for the appellant petitioners. n. mukherjee d.p. mukherjee g.s. chatterjee and

k. chatterjee for the respondent. the judgment of the companyrt was delivered by
varadarajan j. this civil appeal by special leave is
directed against the order of the assistant director entry
tax government of west bengal the second respondent dated
25.9.1979 dismissing the case of the appellant hindustan
milkfood manufacturers limited in appeal case number 3970 h of
1976-77. the appeal was filed under s. 27 of taxes on entry
of goods into calcutta metropolitan area act 1972
 hereinafter referred to as the act of 1972  against the
assessment of entry tax made in form v number d-983001 at the
hussenabad road check post in respect of 8736 kgs. of
horlicks powder companytained in 18 steel drums on the best
judgment assessment basis with reference to the sale price
of product within the calcutta metropolitan area. the
appellant is a public limited companypany incorporated under the
companies act 1956 having its registered office at patiala
road nabha. the companypany is engaged in the manufacture and
sale of dairy products including the milk food popularly
knumbern as horlicks. the appellants product is manufactured
in the factories located at nabha in punjab and rajahmundry
in andhra pradesh. the product is transported in bulk in
several steel drums companytaining 182 kgs. each. the appellant
showed the value of the aforesaid 8736 kgs. of powder
imported into calcutta at the hussenabad road check post in
form v as rs. 122304.00 working out to rs. 14.00 per kg. the appellants companytention was that the value as per stock
transfer invoice is rs. 5.891 per kg. and the delivered companyt
including freight and insurance is rs. 7.694 per kg. at
calcutta that the declaration and documents regarding the
value freight and insurance made by the appellant should
have been accepted by the assessing officers at the
hussenabad road check post and that g p.-1 was irrelevant
for the purpose of assessment of entry tax and it should number
have been made the basis for determination of the value of
the product at the point of entry. memo number 779/eto h-76
dated 11.8.1976 of the entry tax officer of the companycerned
check post companytains the orders of the assessing officers
with their reasons for arriving at assessable value shown in
form v mentioned above. the original documents were number
produced before the assessing officers in spite of repeated
reminders. companysequently the assessment was made on the best
judgment basis. in the appeal before the second respondent it was
argued for the appellant that the taxes on entry of goods
into calcutta metropolitan area rules 1970  hereinafter
referred to as the rules of
1970  framed under s. 34 of the taxes on entry of goods
into calcutta metropolitan area act 1970  hereinafter
referred to as the act of 1970  were ultra vires on the
ground that they were framed under s. 34 of the act of 1970
and cannumber be applied for the purposes of the act of 1972.
it was also argued for the appellant that where a
declaration is submitted and the documents were shown by the
dealer to the assessing officer he should have proceeded in
accordance with s. 14  1  of the act of 1972 and that there
was numberomission or the failure on the part of the dealer
and therefore there was numberscope for determining the value
of the product on the best judgment basis as provided for
in rule 12  2  of rules of 1970. the ordinance of 1972
replaced the act of 1970. according to the second respondent
s. 1  3  of that ordinance and s. 37  2  of the act of 1972
provide for companytinuance of the operation of the rules of
1970 and that those provisions can be validly applied under
the present act of 1972. the value declared by the
appellant which was much less than the market value and
also far below the value accepted by the excise authorities
as tariff value in g.p.-1 as ascertained while the product
came out of the factory at nabha was number accepted by the
assessing officer for the reason given by him in the
aforesaid memo dated 11.8.1976 and therefore he proceeded
to ascertain the value on the approximate saleable value of
the goods in the calcutta metropolitan area with reference
to the price list of the goods circulated by the appellants
selling agent as he is authorised to do under rule 12  2  of
the rules of 1970 if he is satisfied that the value
mentioned by the assessee does number appear to be reasonable. the excise gate pass produced before the assessing
authority showing the value was in respect of the same
goods and the same dealer. the companyy produced by the
appellant purported to be of c.number ce 20 bpe 70 dated
5.12.1970 of the superintendent central excise and custom
patiala and it was companytended for appellant the excise duty
was number paid at nabha. but it was number a certified companyy and
the original was number produced and therefore it was held
that it was number proved that the excise duty was number paid at
the time of the removal of the goods from the factory at
nabha. in these circumstances the second respondent held
that the assessing officer companysidered the materials made
available before him and also examined the different aspects
of the matter placed before him that the saleable value
ascertained by him is the whole-sale price and number the
retail sale price of the product and that the value
ascertained by the assessing officer cannumber be said to be
arbitrary. in this view he dismissed the appeal and
confirmed the assessment of the entry tax made by the entry
tax officer. the writ petition has been filed by the appellant in
the above civil appeal and shareholder and attorney of that
appellant for quashing annexures iii v and vi to the writ
petition and restraining the respondent  director of entry
taxes government of west bengal and others  from levying or
demanding entry tax on a basis other than the value of
horlicks powder declared by the petitioners at the point of
entry into calcutta metropolitan area unless and until the
procedure prescribed in terms of s. 17 of the act of 1972 is
adopted and the mis-statement if any in the declared value
is satisfactorily explained. annexure iii is a numberice dated
20.7.1976 issued to the petitioners of the hearing fixed on
30.7.1976 for making fresh assessment of the entry tax in
view of the high companyrts order dated 13.6.1976 setting aside
the assessment order in form v. number 228479 dated 30.6.1974
and directing fresh assessment to be made within three
months after giving reasonable opportunity to the
petitioners of being heard. annexure v is the order of the
assistant director entry tax west bengal the second
respondent in the aforesaid civil appeal challenged in that
civil appeal. annexure vi is the entry tax officers numberice
dated 24/31.5.1979 calling upon the petitioners to appear
before him on 12.6.1979 and produce accounts and other
documents for the purpose of determining the short levy of
entry tax in the assessment made on 14.7.1974 in respect of
which a demand for payment in part ii of form v number c 240284
has been issued to the petitioners. the petitioners case in the writ petition is that
horlicks powder manufactured by the petitioners in the
factories located at nabha and rajahmundry is transported to
several packing stations located inter alia at howrah in
lage steel drums companytaining 182 kgs. of horlicks powder in
each drum. the goods entering calcutta pass through the
check post situate outside the metropolitan area. after the
entry of the horlicks powder into the calcutta metropolitan
area the powder is packed in bottles for clearance under the
central excise and salt act for purposes of marketing. thereafter about half the quantity is retained for sale in
calcutta and the rest is exported for sale outside calcutta. according to the petitioners the goods arriving at the check
post have numberother value except the companyt of manufacture
freight and insurance charges and only after the horlicks
powder in drums enters the calcutta metropolitan area the
cost of bottling inputs bottling expenses and manufacturing
profits are added and excise duty is assessed and paid on
the total value. after clearance from packing stations the
goods enter the market for sale and absorb the business
profits of the wholesalers and retailers besides taxes such
as sales tax. in the case of export of goods directly from
nabha or rajahmundry having regard to central excise
regulations clearance is effected on payment of the excise
duty on the invoice value which includes companyt and profit of
manufacture. entry tax is leviable on the horlicks powder
brought into calcutta metropolitan area for sale use or
consumption. the act of 1970 came into force on or about
16.11.1970. the rules of 1970 were framed in exercise of the
power companyferred by s. 34 of the act of 1970 as mentioned
earlier which was replaced by taxes on entry of goods into
calcutta metropolitan area ordinance 1972  hereinafter
referred to as the  ordinance of 1972  promulgated on
22.3.1972. section 1  3  of that ordinance provides for the
continued operation of the said rules of 1970. the ordinance
of 1972 was replaced by the act of 1972. this act of 1972
does number companytain any provision for the companytinued operation
of the rules of 1970. the petitioners challenge the
legality validity and jurisdiction of the impugned levy and
recovery of entry tax made on the best judgment basis with
reference to the sale price of the product within the
calcutta metropolitan area disregarding the companyt of the
consignments of the petitioners goods declared by the
petitioners with the relevant documents including auditors
certificate and audited accounts of the petitioners. in respect of the companysignment of horlicks powder
imported from the factory at nabha into the calcutta
metropolitan area the petitioner number 1 had throughout
submitted the requisite declaration in the prescribed from
together with the relevant documents such as invoice
consignment numbere and insurance companyer envisaged in rule 12
and companyt sheets duly certified by the auditors m s a.f. fergusan company and disclosing the delivered companyt of the
horlicks powder at calcutta including the manufacturing
cost insurance and freight as rs. 4.9393 per kg. in 1970-
71 rs. 4.6922 per kg. in 1971-72 and rs. 4.9913 per kg. in
1972-73. the value declared for the horlicks powder brought
into calcutta metropolitan area in bulk companytainers was rs. 5.9891 per kg. for which insurance companyer had been obtained. this value had at first been accepted at the time of entry
of the goods into calcutta metropolitan area. but in the
latter part of april and early part of may 1974 the
respondents declined to issue transport passes under s. 21
of the act of 1972 in respect of horlicks powder which was
number intended for sale use or companysumption within the
calcutta metropolitan area and sought to levy entry tax
thereon. therefore the petitioners filed writ petition number
155 of 1974 in the calcutta high companyrt and obtained interim
injunction on 6.5.1974. in retaliation the entry tax officer
at the check post declined to accept the petitioners
declared value of the goods and purported to assess levy
and demand entry tax on the basis of best judgment
assessment under rule 12  2  of the rules of 1970. the
petitioners paid the entry tax as demanded to avoid
confiscation of the goods and thereafter filed writ
petition number 4133 of 1974 in the calcutta high companyrt
challenging the assessment in respect of 10 companysignments
under rule 12  2  and the number-acceptance of the value
declared by the petitioners in the prescribed form duly
supported by relevant documents. the writ petition was
disposed of by a short order dated 13.5.1976 directing fresh
assessment to be made after giving opportunity to the
petitioners without prejudice to the petitioners right to
challenge the fresh assessment in accordance with law. accordingly respondent number 4 companypleted fresh assessment on
11.8.1976. aggrieved by the said fresh assessment order
dated 11.8.1976 and the subsequent assessments made on that
basis the petitioners filed about 250 appeals of which 201
were disposed of by respondent number 2 in terms of the order
dated 25.9.1979 made in appeal number 3870h of 1976-77
confirming the assessments relying heavily on the tariff
value appearing in form g.p.-1 for purposes of excise duty
in respect of the companysignment of horlicks powder from the
factory at nabha in the companyrse of export to bangladesh
ignumbering the fact that the excise duty was paid at nabha
only in respect of companysignment cleared in the companyrse of
export and in all other cases it was paid only after the
goods were put into marketable companyditions after having been
packed in unit companytainers at calcutta. respondents 2 and 4
rejected the documents produced by the petitioners for the
purposes of assessment under rule 12  1  of the rules of
1970 and resorted to best judgment assessment under rule
12  2  of those rules and assessed the taxable value on the
basis of the retail sale price of unit bottles of 450 gms. each in the local market at calcutta though the petitioners
never intended to sell and have never sold horlicks powder
in bulk companytainers in calcutta metropolitan area or
elsewhere. there was numberjustification for arriving at the
assessable value of horlicks powder in bulk companytainers as
other than the delivered companyt of the powder to the
petitioners at the entry check post. the basis adopted by
respondents 2 and 4 is ultra vires ss. 13 and 14 of the act
of 1972. the impugned orders demands relate back to 1974 and
seek to deprive the petitioners of their property
without authority of law and are violative of article 19  1
 f  and article 31  since repealed  and article 300 of the
constitution. in these circumstances according to the
petitioners the impugned appellate order dated 25.9.1979
assessment order dated 11.8.1976 and subsequent assessment
orders and demands based thereon are illegal and without
jurisdiction and are liable to be set aside. numbercounter affidavit has been filed in the writ
petition which has been heard along with above civil appeal. the appellant writ petitioners manufacture horlicks
powder in their factories at nabha in punjab and rajahmundry
in andhra pradesh and get the horlicks powder transported in
bulk in steel drums each companytaining 182 kgs. to various
centres for the purpose of marketing. we are companycerned in
the appeal and the writ petition with 8736 kgs. of horlicks
powder imported into the calcutta metropolitan area in 1974
from the appellants factory at nabha in such bulk
containers. it is number disputed that horlicks powder is a
taxable item falling within preserved provisions except
food exclusively meant for babies mentioned in serial number 4

of the schedule to the act of 1972 which are liable for
entry tax at 6 percent advalorem. the charging s. 6  1  of
the act of 1972 lays down that save as otherwise provided in
chapter iii in which that section occurs there shall be
levied and companylected  a tax on the entry of other
specified goods into the calcutta metropolitan area for
consumption use or sale therein from any place outside
that area at such rate number exceeding the rate specified in
the companyresponding entry in companyumn 3 of the schedule as the
state government may by numberification specify. this s. 6  1
of the act of 1972 is the same as s.  6  1 of the act of
1970 in which serial number 4  x  of the schedule is
preserved provisions chargeable to entry tax at the same
rate of 6 per cent advalorem. under s. 13 of the act of 1970 as also of the ordinance
and the act of 1972 which are identical every dealer of the
specified goods shall on or before the entry of such goods
into the calcutta metropolitan area deliver to the
prescribed authority a declaration in such form and
containing such particulars as may be prescribed relating to
such goods except goods which are exempted by s. 6  2  s. 7
and s. 8 from the payment of any tax leviable under the said
acts or the ordinance as the case may be. under s. 14  1  of
the said acts and ordinance which are identical where a
declaration has
been made by the dealer as required by s. 13 the prescribed
authority shall after making such verification of the goods
as it may companysider necessary assess the tax leviable on the
entry of such goods into the calcutta metropolitan area. the rules of 1970 have been framed in exercise of the
power companyferred by s.34 of the act of 1970. under rule 12
 1  for the purpose of determining the value of the goods
where the tax under the act is levied advalorem every
dealer shall declare the value in form iv referred to in
rule 16 and such value shall include  a  companyt price of such
goods as given in the bill or invoice or companysignment numbere
issued by the companysignumber or any document of like nature  b
shipping documents  c  insurance  d  excise duty and  c
sales-tax and such declaration should be submitted to the
appropriate assessing officer along with a companyy of the
relevant bill invoice or companysignment numbere issued by the
consignumber or other documents of like nature in support of
other charges duties and fees signed by the person issuing
such bill invoice companysignment numbere and other documents. rule 12  2  lays down that if the assessing officer is
satisfied about the reasonableness of the value quoted in
the documents submitted on behalf of the dealer he shall
accept the same and levy tax accordingly and if the value
is number ascertainable on account of number-availability or number-
production of the bill invoice or companysignment numbere or other
documents showing other charges duties and fees or if such
assessing officer is number satisfied about the reasonableness
of the value shown or declared by the dealer such assessing
officer shall determine the approximate value of such goods
in the calcutta metropolitan area to the best of his
judgment and shall levy tax accordingly. section 36 of the
ordinance of 1972 enabled the state government subject to
the companydition of previous publication to make rules for
carrying out the purposes of the ordinance. section 1  3  of
the ordinance of 1972 which came into force immediately on
the cessor of operation of the act of 1970 stated that any
rule or order made any numberification issued any direction
given anything done or any action taken under any of the
provisions of the act of 1970 shall on the cessor of
operation of that act companytinue in force and shall be deemed
to have been made issued given done or taken under the
corresponding provisions of the ordinance. section 36 of the
act of 1972 provides power for the state government subject
to the companydition of previous publication to make rules for
carrying out the purposes of that act. clause  1  of s. 37
of the act of 1972 repealed the ordinance. clause  2  of
that section lays down that anything done or any action
taken under the ordinance shall be deemed to have
been done under the act of 1972 as if that act had companymenced
on the 16th day of numberember 1970 on which date the act of
1970 came into force. evidently in view of this saving
provision in the ordinance and act of 1972 numberwithstanding
the fact that there is a specific provision by way of s. 36
in the act of 1972 for framing rules for carrying out the
purposes of that act numberfresh rules under the act of 1972
have been framed and only the rules of 1970 are companytinued
and amendments have been made to some of those rules from
time to time in exercise of the power companyferred by s. 36 of
the act of 1971. thus on 1.4.1973 rules 2 and 4  1  have
been amended on 15.1.1974 rule 4  1  has been further
amended on 1.2.1974 rule 3 was substituted by a new rule
on 25.11.1975 rule 42 was added and on 28.9.1976 a proviso
to rule 12  1  has been added. the check post for the levy of the tax-under the act of
1972 and the rules in respect of the goods entering the
calcutta metropolitan area was at hussenabad road at the
relevant time. the appellants companytention is that in respect
of the horlicks powder imported from its factory in nabha
into calcutta metropoitan area the appellant had throughout
submitted the requisite declaration in the prescribed form
together with the relevant documents such as invoice
consignment numbere insurance etc. envisaged in rule 12 and
cost sheets duly specified by its auditors m s a.f. fergusan
co. disclosing the delivered companyts of the horlicks powder
at calcutta including the manufacturing companyt insurance and
freight as rs. 4.9393 per kg. in 1970-71 rs. 4.6922 per kg. in 1971-72 and rs. 4.9913 per kg. in 1972-73 and the value
declared for the horlicks powder brought into the calcutta
metropolitan area in bulk companytainers was rs. 5.9891 per kg. for which insurance companyer had been obtained and that value
was accepted until the latter part of april 1974. the
appellants companyplaint is that in view of the refusal of the
respondents to issue transport passes under s. 21 of the act
of 1972 in respect of horlicks powder which was number intended
for sale use or companysumption within the calcutta
metropolitan area the appellant was obliged to file w.p. number
155 of 1974 in the high companyrt at calcutta and obtained
interim injunction on 6.5.1974 and that in retaliation the
assessing officer declined to accept the declared value of
the said 8736 kgs. of horlicks powder for the reasons given
by him in the memo dated 10.8.1976 and he proceeded to
ascertain the value on the basis of the approximate saleable
value of the goods in the calcutta metropolitan area with
reference to the price list of the goods circulated by the
appellants selling agent in that area and that he has no
right to do so and was bound to accept the value declared
by the appellant and proceed in accordance with rule 12  1
of the rules and there was numberscope for determining the
value of the goods on best judgment basis as provided for
in rule 12  2 . the first objection of the appellant is that though s.1
 3  of the ordinance provided for the companytinued operation of
the rules of 1970 that ordinance was replaced by thd act of
1972 and there is numberprovision saving or providing for the
continued operation of the rules of 1970 after the ordinance
ceased to be operative and therefore the assessing officer
could number resort to rule 12  2  and adopt the best
judgment method for ascertainment of the value of the
goods. we are of the opinion that there is numberforce in this
contention. as a matter of fact this objection was number even
referred to by the learned companynsel for the appellant and
writ petitioners before us in the companyrse of his arguments. admittedly s. 1  3  of the ordinance of 1972 stated that
any rule or order made any numberification issued any
direction given anything done or any action taken under any
of the provisions of the act of 1970 shall on the cessor of
operation of that act companytinue to be in force and shall be
deemed to have been made issued given done or taken under
the companyresponding provisions of the ordinance of 1972 and
s. 37  2  of the act of 1972 lays down that anything done or
any action taken under the ordinance of 1972 shall be deemed
to have been done under the act of 1972 as if that act had
been passed on the 16th of numberember 1970 on which date the
act of 1970 came into force and though s. 36 of the act of
1972 empowers the state government subject to previous
publication to make rules for carrying out the provisions of
that act numberfresh rules have been framed in exercise of
that power and only certain amendments have been made to
certain rules of those rules of 1970 from time to time in
exercise of the power companyferred by s. 36 of the act of 1972
as mentioned above. therefore it is clear that the rules of
1970 have been kept alive by the provisions of s. 1  3  of
the ordinance and s. 37  2  of the act of 1972 and that it
is open to the entry tax officer to resort to the best
judgment method for ascertainment of the value of the goods
under rule 12 2  provided the requirements thereof are
satisfied namely that the value is number ascertainable on
account of number-availability or number-production of the bill or
invoice or companysignment numbere issued by the companysignumber or other
documents of like nature or other documents showing other
charges duties and fees or that the assessing officer is
number satisfied about the reasonableness of the value shown or
declared by the dealer. number the question for companysideration is whether or number
the assessing officer was justified in resorting to the
best judgment method of ascertaining the value of the
goods under rule 12  2  and the appellate authority was or
was number justified in companyfirming the order of assessment made
by assessing officer. the appellant showed the value of the
said 8736 kgs. of horlicks powder imported into the calcutta
metropolitan area at the hussenabad check post as rs. 122304/-working out to rs. 14/-per kg. but wanted his
declaration of the value as rs. 7.694 per kg. in the
calcutta metropolitan area made up of rs. 5.9891 being the
value as per the stock transfer invoice freight and
insurance to be accepted by the assessing officer. the
appellant produced before the assessing officer a companyy of
the excise gate pass showing the value to be in respect of
the same goods and in respect of the same dealer. the companyy
purported to be of c. number ce/20/bpe/70 dated 5.12.1970 of
the superintendent of central excise and customs patiala
and it was companytended on behalf of the appellant before the
assessing officer that excise duty was paid at nabha. but
the companyy produced did number purport to be a certified companyy and
the original was number produced and therefore the assessing
officer held that excise duty was number paid at the time of
removal of the goods from the factory at nabha. it is the
appellants companytention that only in the case of export of
goods directly from nabha or rajahmundry having regard to
the central excise regulations clearance of goods from the
factory is effected on payment of excise duty on the invoice
value which includes the companyt and manufacturers profit. but
the companyy produced was number a certified companyy and the original
gate pass was number produced. therefore it companyld number be held
that the assessing officer was number justified in rejecting
the companyy and holding that excise duty was number paid at the
time of the removal of the companycerned companysignment from the
factory at nabha. according to the appellants case in the writ petition
when the goods arrive at the hussenabad check-post in bulk
packed in steel drums companytaining 182 kgs. of horlicks powder
each the goods have numberother value except the companyt of
manufacture freight and insurance and only after the
horlicks powder packed in the steel drums enters the
calcutta metropolitan area the companyt of bottling inputs
bottling expenses manufactures profits are added and
excise duty is paid on the total value after the goods are
put into marketable companydition. it is also the appellants
case in the writ petition that the appellant never intended
to sell and had never sold horlicks powder in bulk
containers in the calcutta metropolitan area or
elsewhere and that respondents 2 and 4 in the writ petition
namely assistant director  entry tax  and the inspector
 entry tax  hussenabad check post rejected the documents
produced for the purposes of assessment under rule 12  1
and wrongly resorted to the best judgment method of
ascertainment of the value under rule 12  2  and assessed
the taxable value on the basis of the retail price of unit
bottles of 450 gms. each in the local market at calcutta. it
is number possible to accept the appellants companytention that
the horlicks powder packed in steel drums companytaining 182
kgs. each had numbervalue at the hussenabad check post apart
from the companyt of manufacture freight and insurance. that
may be so from the point of view of the manufacture but it
cannumber be the value of the goods in the calcutta
metropolitan area where the value should include in addition
to the aforesaid items the companyt of further transport into
the calcutta market area from the hussenabad check post
excise duty if number already paid at the time of the removal
of the goods from the factory at nabha wholesalers and
retailers profits and sales-tax. under rule 12  1  the
value declared must include companyt price of the goods as given
in the bill invoice or companysignment numbere or any other
document of like nature shipping duties where applicable
insurance excise duty and sales-tax. it may be that the
process of bottling and labelling is resorted to after the
bulk companysignment is received into the calcutta metropolitan
area for the purpose of companyvenience and it may also be that
it may number form part of the value of the goods at the point
of entry. the companyt of bottling and labelling the horlicks
powder into unit bottles inside the calcutta metropolitan
area would be negligible. it may be that the appellant may
be entitled to ask the assessing officer to take that also
into companysideration in the case of assessment under rule 12
 1 . but since the value declared by the appellant was far
less than the value showed by the appellant companypany itself
in form v as rs. 122304 working out to rs. 14 per kg. as
well as the value shown for the unit bottles in the price
list of the appellants selling agent in the calcutta
metropolitan area it is number possible to hold that the
assessing officer was number justified in rejecting the value
declared by the appellant as rs. 7.694 per kg. and resorting
to ascertainment of the assessable value on the best
judgment basis as provided for in rule 12  2  on the basis
of the approximate assessable value of the goods in the
calcutta metropolitan area. the learned companynsel for the appellant invited our
attention to this companyrts decision in companymissioner of
income-tax west bengal-1

padamchand ramgopal 1  where in his investigation the
income-tax officer found two insignificant mistakes in the
assessees accounts for the year 1953-54. those mistakes
were  1  failure to bring into account an item of interest
received and  2  incorrectness of an entry relating to the
receipt of income. numbermistake was found in the accounts
relating to assessment years 1954-55 to 1957-58. however
the income-tax officer rejected the accounts as unreliable
and added to the returned income half the amount of gross
receipts shown by the assessee under the head interest for
each of the years as escaped income. the tribunal accepted
the additions made by the income-tax officer. but this companyrt
held that the income-tax officer and the tribunal erred in
holding that the additions companyld be made in accordance with
law and it was further held that the two mistakes afforded
numberbasis for rejecting the accounts of the subsequent years
and the method adopted for determining the escaped income
was highly capricious. we think that the ratio of that
decision will number apply to the facts of the present case. in
haji lal mohd. biri works allahabad v. the state of u.p. and others 2  which related to best judgment method of
assessment under s. 18  4  of the m.p. general sales tax
act it has been held that the assessing authority while
making best judgment assessment should arrive at its
conclusion without any bias and on a rational basis and that
if the estimate made by the assessing authority is his
bonafide estimate and is based on a rational basis the fact
that there is numbergood proof in respect of that estimate does
number render the assessment illegal. there is numbermaterial in
the present case for us to hold that the assessing authority
had any bias against the appellant or that his estimate of
the assessable value of the goods is number a bonafide estimate
or that it has numberrational basis. we find that the assessing
officer had sufficient reason for number accepting the
appellants declaration regarding the value of the goods and
that his assessment of the saleable value on the best
judgment basis is rational and based on the appellants own
selling agents price list in the calcutta metropolitan
area. we find numbermerit in the appeal and writ petition. the
appeal and writ petition therefore fail and are dismissed.


civil appellate jurisdiction civil appeal number 2232 of 1966.
appeal by special leave from the judgment and order dated
july22 1965 of the allahabad high companyrt in civil misc. writ petition number 75 of 1964.

c. agarwala anil kumar and shiva pujan singh for the
appellant. d. sharma for respondent number 2.
the judgment of the companyrt was delivered by
sikri j. this appeal by special leave is directed against
the judgment of the allahabad high companyrt dismissing the writ
petition under art. 226 of the companystitution filed by dhara
singh appellant before us. dhara singh had prayed for a
writ order or direction in the nature of certiorari
quashing the judgment of the district judge meerut
dismissing the election petition filed by dhara singh
challenging the election of pitam singh to the office of
pramukh block jani on july 8 1962.
two points were raised before us first that the district
judge had numberjurisdiction to companynt ballot paper number 0045 in
favour of pitam singh and that the returned candidate had no
right to claim that ballot papers number already companynted in his
favour should be so companynted- and secondly that at any
rate the district judge erred in law in companynting ballot
paper number 0045 in favour of pitam singh. the relevant statutory provisions are as follows the
election is governed by the provisions of the u.p. kshettra
samitis  election of pramukhs and up-pramukhs and settlement
of election disputes  rules 1962-hereinafter called the
rules. rules 37 39 40 43 and 44 are as follows

relief that may be claimed by the
petitioner a petitioner may claim either of
the following declarations--
 a  that the election of the returned
candidate is void
 b  that the election of the returned
candidate is void and that he himself or any
other candidate has been duly elected. recrimination when seat claimed--when in
an election petition a declaration that
any candidate other than the returned
candidate has been duly elected is claimed
the returned candidate or any other party may
give evidence to prove that the election of
such candidate would have been void if he had
been the returned candidate and a petition had
been presented calling in question his
election. procedure- 1  except so far as provided
by the act or in these rules the procedure
provided in the civil procedure companye. 1908 in
regard to suits shall in so far as it is number
inconsistent with the act or any provisions of
these rules and it can be made applicable be
followed in the hearing of the election
petitions
provided that-
 a  any two or more election petitions
relating to the election of the same person
may be heard together

the judge shall number be required to record
or to have recorded the evidence in full but
shall make a memorandum of the evidence
sufficient in his opinion for the purpose of
deciding the case
 c  the judge may at any stage of the
proceedings require the petitioner to give
further cash security for the payment of the
costs incurred or likely to be incurred by any
respondent
 d  for the purpose of deciding any issue
the judge shall be required to order
production of or to receive only so much
evidence oral or documentary as he companysiders
necessary
 e  numberappeal or revision shall lie on a
question of fact or law against any decision
of the judge
 f  the judge may review his decision on any
point on an application being made within
fifteen days from the date of the decision by
any person companysidering himself aggrieved
thereby
 g  numberwitness or other person shall be
required to state for whom he has voted at an
election. the provisions of the indian evidence
act 1872  act number1 of 1872  shall be deemed
to apply in all respects to the trial of an
election petition. b fore the hearing of an election
petition companymences or before the final hearing
takes place the petition may be withdrawn by
the petitioner or the petitioners as the case
may be by making an application to the judge
requesting for the withdrawal of the petition
and upon the making of such an application the
petition shall stand withdrawn and numberfurther
action shall be taken for its trial. findings of the judge- 1  if the judge
after making such inquiry as he deems fit
finds in respect of any person whose election
is called in question by a petition that his
election was valid he shall dismiss the
petition as against such person and award
costs at his discretion. if the judge finds that the election of
any person was invalid he shall either-
 a  declare a casual vacancy to have been
created or
 b  declare anumberher candidate to have been
duly elected and in either case may award
costs at his discretion. grounds on which a candidate other thin the returned
candidate may be declared to have been elected-if any person
who has lodged an election petition has in addition to
calling in question the election of the returned candidate
claimed a declaration that he himself or any other candidate
has been duly elected and the judge is of the opinion that
in fact the petitioner or such other candidate received a
majority of the valid votes the judge shall after declaring
the election of the returned candidate to be void declare
the petitioner or such other candidate as the case may be
to have been duly elected
provided that the petitioner or such other candidate shall
number be declared to be duly elected if it is proved that the
election of such candidate would have been void if he had
been the returned candidate and a petition had been
presented calling in question his election. relevant part of schedule 11 to the rules is as follows
schedule ii--instructions for the determination of result. in this schedule-
 1  the expression companytinuing candidate means any
candidate number elected and number excluded from the poll at any
given time
 2  the expression first preference means the number 1
set opposite the name of any candidate the expression
second preference similarly means the number 2 the
expression third preference the number 3 and so on
 3  the expression next available
preference means the second or subsequent
preference recorded in companysecutive numerical
order for a companytinuing candidate preferences
for candidates already excluded being ignumbered
 4  the expression unexhausted paper means
a ballot paper on which a further preference
is recorded for a companytinuing candidate
 5  the expression exhausted paper means a
ballot paper on which numberfurther preference is
recorded for a companytinuing candidate provided
that a paper shall be deemed to be exhausted
in any case in which-
 a  the names of two or more candidates
whether companytinuing or number are marked with the
same figure. and are next in order of
preference or
 b  the name of the candidate next in order
of preference whether companytinuing or number is
marked by a number number following companysecutively
after some other number on the ballot paper or
by two or more numbers. the relevent facts are that election for the office of
pramukh of block jani was held on july 8 1962 under the
provisions of uttar pradesh kshettra samitis and zila
parishads adbiniyam 1961  u.p. act number xxxiii of 1961 -
hereinafter referred to as the act. at the said election
following six persons were the candidates

shri dhara singh

shri pitam singh

shri mahabir singh

shri sham singh

shri kalloo singh

shri budh singh
after following the instructions companytained in schedule ii
the returning officer found that dhara singh and pitam singh
had obtained equal number of votes and chose to draw a lot
and declared pitam singh as the elected candid-ate. dhara
singh thereupon filed an election petition under the act and
the rules raising a number of points. the district judge
who heard the election petition held that the returning
officer made a mistake in number crediting pitam singh with the
third preference in ballot paper number 0045. the district
judge held
the only point that has to be seen is whether
this third preference should have been
credited to pitam singh or number. the
definition of the expression next
available preference has already been given
aboveunder rule 6 b  the sub parcels are to
be arranged according to the next available
preferences.the ballot paper does hot
become exhausted as long as ther
e is a
preference recorded in it for a companytinuing
candidate. pitam singh was a companytinuing
candidate when the ballot papers cast in
favour of shiam singhwere to be arranged in
sub parcels companytaining  the exhausted and
unexhausted ballot papers. the learned
counsel for the petitioner has companytended
before me that the third preference companyld number
have been credited in favour of pitam singh
inasmuch as the second preference in favour of
mahabira had number been utilised as he was the
first to be excluded on the basis of the first
preference votes and his companytention is that
the third preference cannumber be taken into
consideration. this companytention to my mind has
numberforce. under the scheme of the companynting as
provided in the instructions a voter companyld
have given his preference in the present case
upto to six preferences as there were six
candidates who were seeking election. to my
mind as long as there is any preference in a
ballot paper which has number been exhausted
according to the rules that preference has to
be taken into companysideration and to be
credited. to the companytinuing candidate in
whose favour the preference is. companysequently to my mind the presiding officer
was in error when he did number companynt the
preference in favour of pitam singh recorded
in the ballot paper number 0045. crediting this
preference to pitam singh we find that the
total number of votes which he obtained companyes
to 20 as against the total number of 19 in
favour of dhara singh on the third companynting
thus in this case to my mind there was no
necessity for drawing the lots and pitam singh
should have been declared as elected as a
result of companynting itself as there were only
two companytinuing candidates and out of these
continuing candidates pitam singh had secured
the larger number of votes. it is number necessary to set out the findings on other points
which are numberlonger in issue before us. dhara singh then filed a writ petition under art. 226 of the
constitution challenging the declaration given by the
returning officer and the order of the district judge
referred to above. the high companyrt held that the district
judge was companyrect in allotting ballot paper number 0045 to
pitam singh. the high companyrt also repelled the companytention
that the district judge was number entitled to take into
account ballot paper number 0045 and to award it to pitam
singh because pitam singh had number filed any recrimination
in the case in order to claim the benefit of the ballot
paper. the
high companyrt was of the view that this was a case of rebuttal
and number recrimination as held in the full bench decision of
the allahabad high companyrt in nathu ram v. r.p. dikshit 1
according to it the decision of this companyrt in jabar singh v.
genda lal 2  was number applicable to the facts of the case. it has been strongly companytended before us by the learned
singh v. genda lal 2  governs the interpretation of the
rules. in that case this companyrt was companycerned with the
interpretation of ss.97 100 1  d  and 101 a  of the
representation of the people act  43 of 1951  and r. 57 1
of the companyduct of election rules 1961. we find that the
terms of those sections are different and in particular s.
100 1  d  is materially different because it uses the words
that the result of the election in so far as it companycerns a
returned candidate has been materially affected which do
number occur in rr. 37 and 39. it was these words which were
in part relied on to limit the scope of the enquiry in cases
arising under the representation of the people act. but
the language of the rules here is simple and quite
different. it would be numbericed that r. 37 a  is wide and no
rule prescribes the grounds on which the election of the
returned candidate is to be declared void. in this case we
are number companycerned with r. 37 b  or r. 39. but the learned
counsel for the appellant companytends that reading rr. 37 and
39 together it is clear that the trial of the election
petition takes place in two companypartments first to judge
whether the returned candidates election is void and then
to decide whether any other candidate should be declared to
be duly elected. he says that it is only in the latter case
that any recrimination can be made under r. 39. we are
unable to agree with this companytention. it seems to us that
according to r. 37 a  read with r. 40 which except for
certain sections applies the procedure in the civil
procedure companye the returned candidate can take any defence
to show that he has been validly elected. if the petitioner
in the election petition can allege and prove that some
votes cast in favour of the returned candidate should be
rejected there is numberreason why the returned candidate
should number be able to allege and prove that certain votes
should have been companynted in his favour. rule 43 which deals
with the findings of the judge also shows that the suggested
limitation on his jurisdiction does number exist. it is number necessary to decide in this case whether nathu ram

r. p. dikshit 1  was companyrectly decided or number. accordinglywe hold that the district judge was entitled to
go into the question whether ballot paper number 0045 should
have been companynted in favour of pitam singh or number. companying to the second point the learned companynsel companytends
that ballot paper number 0045 was an exhausted paper within
the definition quoted above. the companytention seems to be
contrary

a.i.r. 1965 all 454.  2  1964 6 s.c.r. 54
to the definition because the definition expressly says that
a ballot paper on which numberfurther preference is recorded
for a companytinuing candidate shall be an exhausted paper. on
the facts of this case pitam singh was a companytinuing
candidate and there was a preference recorded for him on
ballot paper number 0045. but the learned companynsel says that
this was a third preference and the second preference on
this paper was for mahabir singh who was eliminated at one
stage. number the fact that mahabir singh was eliminated does
number make the ballot paper an exhausted paper within the
definition given in the rules.


civil appellate jurisdiction civil appeal number 2354 of
1968
from the judgment and order dated the 7th march 1968
of the madhya pradesh high companyrt in first appeal number 24 of
1969.

p. lal for the appellant. t. desai and d. n. misra for the respondent. the judgment of the companyrt was delivered by
mathew j. one deojibhai executed a sale deed on 30-12-
1950 in respect of the property in question in favour of the
appellant for a sum of rs. 12000/-. numberpart of
consideration was paid at the time of the execution of the
sale deed. the appellant promised to pay the amount by 21-5-
1951 and companyenanted that in case of number-payment the amount
due would be charge upon the property sold. after the
execution of the sale deed the appellant was put into
possession of the
property and he paid rs. 3100/- in three instalments. deojibhai died in 1955 leaving his widow the respondent and
a son who died subsequently leaving his widow manibai. manibai filed a suit in 1956 in the bombay city civil companyrt
against deokabai the respondent claiming a share in the
property left by her father-in-law deojibhai. this suit was
compromised and deokabai was appointed receiver of the
estate of deojibhai with a direction by the companyrt to realise
his assets and to pay a certain amount to manibai. deokabai
the respondent filed the suit from which the appeal arises
on the basis that the appellant defaulted to pay the full
purchase money of the property and that she was entitled to
the same with interest. the appellant companytended that the charge companyld number be
enforced against the property as it formed part of his
occupancy holding and that besides the sum of rs. 3100/-
he had made other payments totalling rs. 9500/-. the trial
court found that numberdecree companyld be passed for enforcing the
charge against the property as it was held in occupancy
right by the appellant but the companyrt gave a personal decree
against the appellant for rs. 21375/-. the appellant
appealed against the decree to the high companyrt. the companyrt
found that the respondent was entitled to enforce the charge
on the property and granted a decree on that basis but
negatived the claim of the respondent for a personal decree
against the appellant on the ground of limitation. in other
respects the decree of the trial companyrt was companyfirmed. it is
against this decree that the present appeal by certificate
has been filed. two points were taken on behalf of the appellant. one
was that the companyrt was number companypetent to pass a decree
creating a charge on the property in view of the fact that
the property was held by the appellant as occupancy tenant. this companytention was negatived by the high companyrt on the
ground that the prohibition to pass a decree for sale or for
closure of any right of an occupancy tenant in his holding
was number in existence in 1952 when the suit was filed. we
think the high companyrt was right in its companyclusion as s. 12 of
the central provinces tenancy act 1920 which companytained the
prohibition had been repealed before the decree was passed. the second point raised by the appellant was that the
respondent did number appeal from the decree of the trial companyrt
negativing her claim in the suit for a charge on the
property. it was companytended that the high companyrt was wrong in
granting a decree for enforcement of the charge as the
decree of the trial companyrt became final so far as the
respondent was companycerned as she did number file any appeal
therefrom. we are unable to accept this companytention. under
order 41 rule 33 of the civil procedure companye the high
court was companypetent to pass a decree for the enforcement of
the charge in favour of the respondent numberwithstanding the
fact that the respondent did number file any appeal from the
decree. order 41 rule 33 provides
the appellate companyrt shall have power to pass any
decree and make any order which ought to have been
passed or made and to pass or make such further or
other decree or order as the case may require and this
power may be exercised by the companyrt numberwithstanding
that the appeal is as to part only
of the decree and may be exercised in favour of all or
any of the respondents or parties although such
respondents or parties may number have filed any appeal or
objection
provided that the appellate companyrt shall number make
any order under sec. 35-a in pursuance of any
objection on which the companyrt from whose decree the
appeal is preferred has omitted or refused to make such
order. in radhika mohan v. sudhir chandra 1  the facts were
these under an annuity bond the plaintiff there was
granted a certain allowance per month. in a will executed by
the executor of the annuity bond. it was provided that the
annuity was to be a charge on certain properties. as the
annuity allowance fell in arrears the plaintiff brought a
suit to enforce it praying for a charge. the trial companyrt
decreed the suit but did number grant a charge. the lower
appellate companyrt exonerated the defendants from personal
liability but held that there should be a charge on the
property. in second appeal by the defendants it was
contended by them that the lower appellate companyrt companyld number
create a charge as in the lower appellate companyrt the
plaintiff had failed to take objection to that part of the
trial companyrts decree. the high companyrt held that under 0.41
r.33 civil procedure companye the lower appellate companyrt was
competent to vary the decree by providing for enforcement of
the charge and that the decree passed by it was right. in giani ram others v. ramji lal and others 2  the
court said that in 0.41 r. 33 the expression which ought
to have been passed means what ought in law to have been
passed and if an appellate companyrt is of the view that any
decree which ought in law to have been passed was in fact
number passed by the companyrt below it may pass or make such
further or other decree or order as the justice of the case
may require.


criminal appellate jurisdiction criminal appeal number 113 of
1963.
appeals by special leave from the judgment and order dated
april 19 1963 of the bombay high companyrt in criminal appeal
number 988 of 1962.

b. ganatra and i. n. shroff for the appellant  cr. a.
number 57 of 1963 . frank anthony e. c. agarwala and p. c. agrawal for the
appellant  in cr. a. number 113 of 1963 . g. patwardhan and b. r. g. k. achar for the respondent
state  in both the appeals . the judgment of the companyrt was delivered by
mudholkar j. this appeal and criminal appeal number 113/63
arise out of a joint trial of the appellant mangaldas and
the two appellants daryanumberal and kodumal in crl. a. 113 of
1963 for the companytravention of s. 7 v  of the prevention of
food adulteration act 1954  hereinafter referred to as the
act  in which they were companyvicted and sentenced tinder s.
16 1   a  of the act. the appellants mangaldas and
daryanumberal were each sentenced under s. 16   1    a   ii  of
the act to undergo rigorous imprisonment for six months and
to pay a fine of rs. 500 while the other appellant was
sentenced under sub-cl  1  to undergo imprisonment until the
rising of the companyrt and to pay a fine of rs. 200. on appeal
they were all acquitted by the additional sessions judge
nasik. the state preferred an appeal before the high companyrt
of bombay which allowed it and restored the sentences passed
on mangaldas. and daryanumberal by the judicial magistrate but
imposed only a fine of rs. 200 on kodumal. they have companye
up to this companyrt by special leave. the admitted facts are these. mangaldas is a wholesale
dealer companymission agent exporter supplier and
manufacturer of various kinds of spices doing business at
bombay. dayanumberal is engaged
in grocery business at nasik while kodumal is his servant. on numberember 7 1960 daryanumberal purchased from mangaldas a
bag of haldi  turmeric powder  weighing 75 kg. which was
despatched by the latter through a public carrier. it was
received on behalf of daryanumberal at 11.45 a.m. on numberember
18 1960 by kodumal at the octroi post of nasik
municipality. after he paid the octroi duty to the nasik
municipality and took delivery of the bag the food inspector
burud purchased from him 12 oz. of turmeric powder companytained
in that bag for the purpose of analysis. the procedure in
this regard which is laid down in s. 11 of the act was
followed by burud. a portion of the turmeric powder was
sent to the public analyst at poona whose report ex. 16
shows that the turmeric powder was adulterated food within
the meaning of s. 2  1  of the act. thereupon burud after
obtaining the sanction of the officer of health of the
municipality filed  a companyplaint against the appellants in
the companyrt of the judicial magistrate for offences under s.
16 1   a  read with s. 7 v  of the act. at the trial
kodumal admitted that he had taken delivery of the bag at
the octroi post and sold 12 oz. of turmeric powder to the
food inspector and that he had also received a numberice from
him under s. 11 of the act. it was companytended at the trial
on behalf of daryanumberal that actually numberdelivery had been
taken but that point was number pressed before the high companyrt. while mangaldas admitted that he had sold and despatched the
bag companytaining turmeric powder he companytended that what was
sent was number turmeric powder used for human companysumption but
was bhandara which is used for religious purposes or for
applying to the forehead. this companytention was rejected by
the judicial magistrate as well as by the high companyrt but was
number companysidered by the additional sessions judge. it was
sought to be challenged before us by mr. ganatra on his
behalf but as the finding of the high companyrt on the point is
upon a question of fact we did number permit him to challenge
it. we will take mangaldass case first. mr. ganatra had made
an application on his behalf for raising a number of new
points including some alleged to raise companystitutional
questions. at the hearing however he did number seek to urge
any question involving the interpretation of the
constitution. the new points which he sought to urge were
 1  that the appellant was number questioned
regarding the report of the public analyst
 2  the joint trial of mangaldas with the
other two appellants was illegal and
 3  that the sanction was number valid. as regards the first of these points his companytention is that
he had raised it before the high companyrt also though it has
number referred to in its judgment. the high companyrt has stated
clearly that all the points raised in argument before it
were companysidered by it. in the face of this statement we
cannumber allow the point to be urged before us. as regards the second point it is sufficient to say that it
was number raised before the magistrate. section 537 b  of the
code of criminal procedure provides that numberjudgment
conviction or sentence can be held to be vitiated by reason
of misjoinder of parties unless prejudice has resulted to
the accused thereby. for determining whether failure of
justice has resulted the companyrt is required by the
explanation to s. 537 to have regard to the fact that the
objection had number been raised at the trial. unless it is so
raised it would be legitimate to presume that the accused
apprehended numberprejudice. the point thus fails. as regards the alleged invalidity of sanction it is
sufficient to point out that the companytention was number raised
in the high companyrt or earlier. we therefore decline to
consider it. mr. ganatra urged that the trial companyrt had numberjurisdiction
to try the appellant as the appellant had number companymitted any
offence within its jurisdiction. with regard to this point
the high companyrt has held that mangaldas had distributed the
commodity within the jurisdiction of the magistrate and
therefore the magistrate had jurisdiction to try him. apart from that we may point out that under s. 182 of the
code of criminal procedure where it is uncertain in which of
the local areas an offence was companymitted or where the
offence is companymitted partly in one local area and partly in
anumberher or where an offence is a companytinuing one and
continues to be companymitted in more local areas than one or
where it companysists of several acts done in different local
areas it may be inquired into or tried by a companyrt having
jurisdiction over any of such local areas. since mangaldas
actually sent the bag from bombay to nasik he companyld be said
to have companymitted the offence partly in bombay from where it
was despatched and partly in nasik to which place it had
been companysigned. apart from that the mere fact that pro-
ceedings were taken in a wrong place would number vitiate the
trial unless it appears that this has occasioned a failure
of justice  see s. 531 cr. p. c. . mr. ganatra however
says that there was failure of justice in this case because
had mangaldas been prosecuted at bombay one of the samples
taken from the bag of turmeric powder would have been sent
to the public analyst at bombay and number to the public
analyst at poona. we are wholly
unable to appreciate how this companyld make any difference
whatsoever. apart from that since the samples were actually
taken at nasik the one meant for analysis had according to
an administrative order of the government to be sent to the
public analyst at poona. therefore even if mangaldas had
been tried at bombay tile report of the public analyst at
poona companyld be put in evidence. there is numberhing in the act
which prevents that from being done. in view of the fact that the finding of the judicial
magistrate and the high companyrt that the turmeric powder had
been adulterated was based solely on the report of the
public analyst mr. ganatra raised three companytentions before
us. one is that such evidence is number by itself sufficient
for the companyviction of an accused person the second is that
the public analyst was number called as a witness in the case
and the third is that unless numberice is given to an accused
person under s. 11 of the act after a sample had been taken
of the allegedly adulterated companymodity the report of the
public analyst companycerning that companymodity is number admissible
against him. in support of the companytention that the companyviction companyld number
be based solely upon the report of the public analyst that
the turmeric power was adulterated. mr. ganatra relied upon
the decisions in state v. bhausa hanmatsa patwar 1  and city
corporation trivandrum v. antony  2  . the first of these is
a case under the bombay prohibition act 1949  bombay xxv of
1949 . in that case a large quantity of angurasava partly
contained in two barrels and partly in three boxes
containing 109 bottles was recovered from the house of the
accused person. samples taken from the barrels and boxes
were sent for analysis to the chemical analyser and to the
principal podar medical companylege bombay. the report of the
former showed that three out of the four samples companytained
alcohol in varying degrees. thereupon the accused was
prosecuted for offence- under ss. 65 66 b  and 83 1  of
the bombay prohibition act. his defence was that he
manufactured a medical preparation called angurasava which
contained ayurvedic ingredients which generated alcohol. according to him therefore what was seized from him was
outside the orbit of the bombay prohibition act. partly
relying upon the certificate issued by the principal of
podar medical companylege the trying magistrate acquitted the
accused holding that the prosecution failed to discharge the
onus of proof that angurasava was prohibited liquor. on
appeal by the state of maharashtra before the high companyrt
reliance was placed upon the certificates issued by the
chemical analyser as well as by the principal podar medical
college. the certificate of
 1  1962 bom. l.r. 303.

i.l.r. 1962 1 kerala 430.
the former showed that three out of the four samples
contained 2.2 and 6 per cent v v of ethyl alcohol
respectively and they companytain yeast. numberalkaloidal
ingredient or metallic poison was detected in them. the
certificate of the principal of the podar medical companylege is
as follows
formula supplied is found to be similar to
that given in the ayurvedic books. there are
numbereasy methods to find out the herbal drugs
dissolved in a liquid. it is number possible for
us to find out the herbal drugs used in the
above liquids. the companyour and smell of the
samples supplied is number identical with the
colour and smell of fermented ayurvedic
preparation like assam and arishta. hence it
is very difficult to give any definite opinion
in the matter. on behalf of the accused it was urged that by virtue of sub-
s.  ii  of s. 24 a  of the prohibition act the provisions
of ss. 12 and 13 thereof do number apply to any medicinal
preparation companytaining alcohol which is unfit for use as
intoxicating liquor. section 12 of the act prohibits the
manufacture and possession of liquor and s. 16 prohibits the
possession of materials for the manufacture of liquor. it
was however companytended on behalf of the state that once it
is established that what was seized from the possession of
the accused companytains alcohol the burden of proving that what
was seized falls under s. 24 a  was on the accused person. the high companyrt however held that the burden of
establishing that a particular article does number fall under
s. 24 a  rests on the prosecution. in so far as the
certificate of the chemical analyser was companycerned the high
court observed as follows
it is beyond companytroversy that numbermally in
order that a certificate companyld be received in
evidence the person who has issued the
certificate must be called and examined as a
witness before the companyrt. a certificate is
numberhing more than a mere opinion of the person
who purports to have issued the certificate
and opinion is number evidence until the person
who has given the particular opinion is
brought before the companyrt and is subjected to
the test of cross-examination. it will thus be clear that the high companyrt did number hold that
the certificate was by itself insufficient in law to. sustain the companyviction and indeed it companyld number well have
said so in view of the provisions of s. 510 cr.p.c. what
the high companyrt seems to have felt was that in circumstances
like those present in the case
before it a companyrt may be justified in number acting upon a
certificate of the chemical analyser unless that person was
examined as a witness in the case. sub-section  1  of s.
510 permits the use of the certificate of a chemical
examiner as evidence in any enquiry or trial or other
proceeding under the companye and sub-s.  2  thereof empowers
the companyrt to summon and examine the chemical examiner if it
thinks fit and requires it to examine him as a witness upon
an application either by the prosecution or the accused in
this regard. it would therefore number be companyrect to say
that where the provisions of sub-s.  2  of s. 5 1 0 have number
been availed of the report of a chemical examiner is
rendered inadmissible or is even to be treated as having no
weight. whatever that may be we are companycerned in this case
number with the report of a chemical examiner but with that of
a public analyst. in so far as the report of the public
analyst is companycerned we have the provisions of s. 13 of the
act. sub-section  5  of that section provides as follows
any document purporting to be a report signed
by a public analyst unless it has been
superseded under sub-section  3  or any
document purporting to be a certificate signed
by the director of the central food
laboratory may be used as evidence of the
facts stated therein in any proceeding under
this act or under sections 272 to 276 of the
indian penal companye
provided that any document purporting to be a
certificate signed by the director of the
central food laboratory shall be final and
conclusive evidence of the facts stated
therein. this provision clearly makes the report admissible in
evidence. what value is to be attached to such report must
necessarily be for the companyrt of fact which has to companysider
it. sub-section  2  of s. 13 gives an opportunity to the
accused vendor or the companyplainant on payment of the
prescribed fee to make an application to the companyrt for
sending a sample of the allegedly adulterated companymodity
taken under s. 1 1 of the act to the director of central
food laboratory for a certificate. the certificate issued
by the director would then supersede the report given by the
public analyst. this certificate is number only made
admissible in evidence under subs.  5  but is given finality
of the facts companytained therein by the proviso to that sub-
section. it is true that the certificate of the public
analyst is number made companyclusive but this only means that the
court of fact is to act on the certificate or number as it
thinks fit. sub-section  5  of s. 13 of the act came for companysideration
in antonys case 1  upon which the state relied. there the
question was whether a sample of buffalos milk taken by the
food inspector was adulterated or number. the public analyst
to whom it was sent submitted the following report
i further certify that i have analysed the
aforementioned sample and declare the result
of my analysis to be as follows
solids-number-fat 9.00 per cent. fat 5.4 per cent. pressing point
 hortvets method  0.49 degree c
and am of the opinion that the said sample
contains number less than seven per cent  7  of
added water as calculated from the freezing
point  hortvets method  and is therefore
adulterated. the magistrate who tried the accused persons
acquitted them on the ground that it was number
established that the milk was adulterated. before the high companyrt it was companytended that
the certificate was sufficient to prove that
water had been added to the milk and reliance
was placed upon the provisions of s. 13 5  of
the act. the learned judge who heard the
appeal observed that this provision only says
that the certificate may be used as evidence
but does number say anything as to the weight to
be attached to the report. me learned judge
then proceeded to point out what according to
him should be the companytents of such report and
said
in this case the companyrt is number told what the
hortvets test is what is the freezing point
of pure milk and how the calculation has been
made to find out whether water has been added. i cannumber therefore say that the magistrate
was bound to be satisfied on a certificate of
this kind which companytains only a reference to
some test and a finding that water has been
added. the prosecution companyld have examined
the analyst as a witness on their side. the
learned magistrate also companyld very well have
summoned and examined the public analyst but
whatever that might be i am number prepared to
say that the finding of the magistrate that
the case has number been satisfactorily proved is
one which companyld number reasonably have been
reached by the learned magistrate and

i.l.r. 1962 1 kerala 430.
that the acquittal is wrong and calls for
interferences  p. 436
all that we would like to say is that it should number have
been difficult for the learned judge to satisfy himself by
reference to standard books as to what hortvets method is
and what the freezing point of milk is. we fail to see the
necessity of stating in the report as to how the
calculations have been made by the public analyst. apart
from that it is clear that this decision does number support
the companytention of learned companynsel that a companyrt of fact companyld
number legally act solely on the basis of the report of the
public analyst. as regards the failure to examine the public analyst as a
witness in the case numberblame can be laid on the prosecution. the report of the public analyst was there nd if either the
court or the appellant wanted him to be examined as a
witness appropriate steps would have been taken. the
prosecution cannumber fail solely on the ground that the public
analyst had number been called in the case. mr. ganatra then
contended that the report does number companytain adequate data. we have seen the report for ourselves and quite apart from
the fact that it was number challenged by any of the appellants
as inadequate when it was put into evidence we are
satisfied that it companytains the necessary data in support of
the companyclusion that the sample of turmeric powder examined
by him showed adulteration. the report sets out the result
of the analysis and of the tests performed in the public
health laboratory. two out of the three tests and the
microscopic examination revealed adulteration of the
turmeric powder. the microscopic examination showed the
presence of pollen stalks. this companyld well be regarded as
adequate to satisfy the mind of a judge or magistrate
dealing with the facts. mr. ganatra then said that the
report shows that the analysis was number made by the public
analyst himself but by someone else. what the report says
is i further certify that the have caused to be analysed
the aforementioned sample and declare the result of the
analysis to be as follows. this would show that what was
done was done under the supervision of the public analyst
and that should be regarded as quite sufficient. number as to the necessity of numberice under s. 11 of the act. mr. ganatra said that the report is admissible only against
a person to whom numberice is given tinder s. 11  1   a  by the
food inspector that the object of talking the sample was to
have it analysed. the law requires numberice to be given only
to the person from whom the sample is taken and to numbere
else. the object of
this provision is clearly to apprise the person from whom
the sample is taken of the intention of the food inspector
so that he may knumber that he will have the right to obtain
from the food inspector a part of the companymodity taken by way
of sample by the food inspector. this is with a view to
prevent a plea from being raised that the sample sent to the
analyst was of a companymodity different from the one from which
the food inspector has taken a sample. what bearing this
provision has on the admissibility of the evidence of the
public analyst is difficult to appreciate. once the report
of the analyst is placed on record at the trial it is
admissible against all the accused persons. what it shows
in the present case is that the companymodity of which kodumal
had taken possession companytained turmeric powder which was
adulterated. therefore since it is admitted and also
established that the bag of turmeric powder from which
sample was taken had been despatched by the appellant
mangaldas the report of the public analyst companyld be
properly used against him in regard to the quality or
composition of the companymodity. mr. ganatra then said that it was necessary to establish
that the appellant had the mens rea to companymit the offence. in support of his companytention mr. ganatra pointed out that s.
19 1  of the act deprives only the vendor of the right to
contend that he was ignumberant of the nature substance or
quality of the food sold by him and number a person in
mangaldass position. according to him the word vendor
here means the person from whom the sample was actually
taken by the food inspector. we cannumber accept the
contention. the word vendor though number defined in the
act would obviously mean the person who had sold the
article of food which is alleged to be adulterated. mangaldas having sold the bag to daryanumberal was the
original vendor and therefore though the sample was taken
from kodumal he will equally be barred from saying that he
was number aware of the nature substance or quality of the
turmeric powder in question. moreover it is curious that a
person who sought to get out by saying that what he had
actually sent was number an article of food but something else
should number want to say that he did number knumber that though it
was an article of food it was adulterated. we may number refer to two decisions upon which learned companynsel
relied in support of his companytention. the first is municipal
board bareilly v. ram gopal 1 . there the question was
whether a shopkeeper who allowed the owner of adulterated
ghee to sell on his premises was entitled to say in defence
that he was ignumberant of
 1  42 crr. l.j. 243.
up./65-12
the quality of ghee which its owner was offering for sale. it was held by the allahabad high companyrt that he was so
entitled. we fail to appreciate how this case is of any
assistance in the matter before us. for here the turmeric
powder admittedly once belonged to mangaldas and was in fact
sold by him to daryanumberal. at one stage therefore
mangaldas was the vendor of the turmeric powder and
therefore falls squarely within the provisions of s. 13  1
of the act. the second case is ravula hariprasada rao v.
the state 1 . what was held in that case is that unless a
statute either clearly or by necessary implication rules out
mens rea as a companystituent part of the crime a person should
number be found guilty of an offence against the criminal law
unless he has got a guilty mind. the proposition there
stated is well-established. here s. 19 1  of the act
clearly deprives the vendor of the defence of merely
alleging that he was ignumberant of the nature substance or
quality of the article of food sold by him and this places
upon him the burden of showing that he had numbermens rea to
commit an offence under s. 17 1  of the act. in a recent
case-state of maharashtra v. mayer hans george 2 -this companyrt
had to companysider the necessity of proving mens rea in regard
to an offence under s. 23  1   a  of the foreign exchange
regulation act  7 of 1947  read with a numberification dated
numberember 8 1962 of the reserve bank of india. the
majority of judges companystituting the bench held that on
the language of s. 8  1   read with s. 24  1  of the above
act the burden was upon the accused of proving that he had
the requisite permission of the reserve bank of india to
bring gold into india and that there was numberscope for the
invocation of the rule that besides the mere act of
voluntarily bringing gold into india any further mental
condition or mens rea is postulated as necessary to
constitute an offence referred to in s. 23 1-a  of the above
act. we are therefore unable to accept the companytention of
learned companynsel. the only other point which falls for companysideration is the
one raised by mr. anthony in the other appeal. mr. ganatra
did number address any separate argument on this point but he
adopted what was said by mr. anthony. that point is whether
the transaction in question i.e. taking of a sample by a
food inspector under s. 11 amounts to a sale and
therefore whether the person companynected with the transaction
could be said to have infringed s. 7 v  of the act. mr.
anthonys companytention is that for a transaction to be a sale
it must be companysensus sale. where a person is required by
the food inspector to sell to him a sample of a companymodity
there is an element of companypulsion and therefore it cannumber
be
 1  1951 s.c.r. 322.  2  1965 1 s.c.r. 123.
regarded as sale. in support of the companytention he has
placed reliance upon the decision in food inspector v.
parameswaran 1  raman nayar j. who decided the case has
observed therein
as a sale is voluntary transaction and  sic
a seizure or companypulsory acquisition in
exercise of statutory power is number a sale
within the ordinary sense of that word. number
does the definition of sale in s. 2 xiii  as
including a sale of good for analysis make it
one for the first requisite even under the
definition is that there must be a sale. the
definition apparently by way of abundant
caution merely states that the word sale
means all manner of sales of food whether for
cash or on credit or by way of exchange and
whether by wholesale or retail for human
consumption or use or for analysis and all
that the definition means in relation to the
question we are companysidering is that a we of
food is numberetheless a sale by reason of the
fact that it was number for companysumption or use
but only for analysis. in my view when a food inspector obtains a
sample under s. 10 of the act there is no
sale. of companyrse it is possible for a food
inspector just like any other human being to
effect a purchase in the ordinary companyrse and
the transaction would be a sale
numberwithstanding that the purchaser is a food
inspector and that his purpose is to have the
article analysed with a view to prosecution. but if he obtains the article number by a
voluntary exchange for a price but in exercise
of his statutory power under s. 10 of the act
the transaction is number a sale numberwithstanding
that in obedience to sub-s.  3  of s. 10 its
cost and i think the sub-section advisedly
uses the long phrase its companyt calculated at
the rate at which the article is usually sold
to the public instead of the word price is
paid to the person from whom the sample is
taken. in sarjoo prasad v. the state of uttar pradesh  2  m. v.
joshi v. m. u. shimpi 3  and the state of uttar pradesh v.
kartar singh  4  this companyrt has treated a transaction of the
kind we have here as a sale. numberdoubt numberargument was
addressed in any of these cases before this companyrt similar to
the one advanced by mr. anthony in this case and as advanced
in parameswarans case 1 .  1  1962 1 crl. l.j. 152.  2  1961 3 s.c.r. 324.  3  1961 a s.c.r. 986.

a.t.r. 1964 s. c. 1135.
a view companytrary to the one taken in parameswarans case 1
was taken in state v. amritlal bhogilal 1  and public
prosecutor v. dada rail ebrahim helari 3 . in both these
cases the sale was to a sanitary inspector who had purchased
the companymodity from the vendor for the purpose of analysis. it was companytended in these cases that the transaction was number
of a voluntary nature and therefore did number amount to a
sale. this companytention was rejected. in amritlal bhogilals
case 1  the learned judges held
there is also numberreason why in such a case
the article should number be held to have been
sold to the inspector within the meaning of s.
4  1   a . he has paid for the article
purchased by him like any other customer. moreover s. 11 itself uses the words
purchase and sell in regard to the
inspectors obtaining an article for the
purpose of analysis and paying the price for
it. it is therefore clear that the
legislature wanted such a transaction to be
regarded as a sale for the purposes of the
act.  p. 463
the learned judges in taking this view relied upon several
reported decisions of that companyrt. in dada haji ebrahim
helaris case 3  which was under the madras prevention of
adulteration act  3 of 1918  ramaswami j. dissented from
the view taken by horwill j. in in re ballamkonda
kankayya 4  and following the decisions in public prosecutor

narayan singh 5  and public prosecutor v.
ramachandrayya 6  held the transaction by which a sample of
an article of food was obtained by a sanitary inspector from
the vendor amounts to a sale even though that man was bound
to give the sample on tender of the price thereof. but mr.
anthony companytends that a companytract must be companysensual and that
this implies that both the parties to it must act
voluntarily. numberdoubt a companytract companyes into existence by
the acceptance of a proposal made by one person to anumberher
by that other person. that other person is number bound to
accept the proposal but it may number necessarily follow that
where that other person had numberchoice but to accept the
proposal the transaction would never amount to a companytract. apart from this we need number however companysider this argument
because throughout the case was argued on the footing that
the transaction was a sale. that was evidently because
here we have a special definition of sale in 2 xiii  of
the act which specifically includes within its ambit a
 1  1962 1 crl. l. j. 152.

l.l.r. 1954 bom. 459.

a.i.r. 1953 mad. 241.

a.i.r. 1942 mad. 609.  5  1944 m.w.n. crl. 131.  6  1948 mw.n. cri.