civil appellate jurisdiction civil appeal number 1963 of
1977.  appeal from the judgment and order dated the 6th july 1977
of the kerala high companyrt in-election petition number 6 of
1.977

m. tarkunde a. s. nambiar p. nambiar for the
appellant. t. desai s. k. mehta k. r. nagaraja p. n. puri for
the respondent. the judgment of the companyrt was delivered by
bhagwati j. this appeal arises out of an election petition
filed by the appellant in the high companyrt of kerala
challenging the election of the respondent to the lok sabha
from kozhikode companystituency under the representation of the
people act 1951  hereinafter referred to as the act . the election was held on 19th march 1977 and the respondent
having secured the majority of votes was declared elected to
the lok sabha on 20th march 1977. the appellant who was
a rival candidate filed an election petition in the high
court of kerala challenging the election of the respondent
on various grounds. one of which was companymission of certain
corrupt practices set out in the election petition. the
election petition was duly signed and verified by the
appellant and it was accompanied by the requisite affidavit
in support of the allegations of companyrupt practice and their
particulars. the election petition and the affidavit were
tied together as one document and two companyies of this
document were filed for service on the respondent. the
signature of the appellant by way of authentication appeared
at the foot of the companyy of the affidavit but there was no
such signature separately .appended at the foot of the companyy
of the election petition. the respondent. therefore on
filing his appearance raised a preliminary objection
against the maintainability of the election petition- and
contended that since the companyy of the election petition was
number attested by the appellant under her own signature to be
a true companyy there was number-compliance with section 81 sub-
section  3  and hence the election petition was liable to be
dismissed under section 86 sub-section  1  of the act. this preliminary objection was tried first since if it was
well founded the high companyrt was bound to dismiss the
election petition and companyld number proceed to hear it on
merits. the high companyrt delivered its judgment on this
preliminary issue on 6th july 1977 and held that what
section 81 sub-section  3  requires is attestation of the
copy of the election petition under the signature of the
petitioner and since in the present
case signature by way of attestation was on the companyy of the
affidavit and number on the companyy of the election petition
there was number-compliance with section 81 sub-section  3
and the election petition was liable to be dismissed in
limine under sub-section  1  of section 86. the appellant
being aggrieved by the dismissal of the election petition
preferred the present appeal under s. 116a of the act. the companytroversy between the parties in this appeal lies in a
narrow companypass. but before we deal with it it would be
convenient at this stage to refer to the relevant provisions
of the act which have a bearing on the arguments urged
before us. part vi of the art is headed disputes regarding
elections and chapter ii in that part deals with the
presentation of election petitions to the high companyrt section
80 provides that numberelection shall be called in question
except by an election petition presented in accordance with
the provisions of part vi. section 80a lays down the forum
which shall have jurisdiction to try an election petition
and the high companyrt is designated as such forum. then companyes
section 81 which is a little important. it reads

presentation of petition.-

an election petition calling in question
any election may be presented on one or more
of the grounds specified in sub-section  1  of
section 100 and section 101 to the high companyrt
by any candidate at such election or any
elector within forty-five days from but number
earlier than the date of election of the
returned candidate or if there are more than
one returned candidate at the election and the
dates of their election are different the
later of those two dates. explanation.-in this sub-section elector
means a person who was entitled to vote at the
election to which the election petition
relates whether he hag voted at such election
or number. x x x

every election petition shall be
accompanied by as many companyies thereof as there
are respondents mentioned in the petition and
every such companyy shall be attested by the
petitioner under his own signature to be a
true companyy of the
petition. the election petition here was accompanied by two companyies
thereof though there was only one respondent mentioned in
the election petition. there was admittedly companypliance with
the first part of sub-section  3  of section 81. the
dispute between the parties was only as regards fulfilment
of the last part of section 81 sub-section  3  which
requires that every such companyy shall be attested by the
petitioner under his own signature to be a true companyy of the
election petition. the argument of the respondent was and
that is the argument which found favour with the high companyrt
that neither of the two companyies of the election petition
filed by the appellant was attested by her under her own
signature to be a true companyy of the election petition. there
was undoubtedly signature of the appellant at the foot of
the companyy of the affidavit which was filed along with the
election petition but there being numbersignature by
way of attestation on the companyy of the election petition
there was numbercompliance with sub-section  3  of section 81.
we shall presently companysider this argument but in the
meanwhile we may proceed with the summary of the relevant
provisions of the act. section 82 which is the next
section lays down who shall be parties to an election
petition. we need number refer to this section in detail since
we are number companycerned with it. section 83 is however
material and it provides what shall be the companytents of an
election petition. it reads

contents of petition.-

an election petition-
 a  shall companytain a companycise statement of the
material facts on which the petitioner relies
 b  shall set forth full particulars of any
corrupt practice that the petitioner alleges
including as full a statement as possible of
the names of the parties alleged to have
committed such companyrupt practice and the date
of the companymission of each such practice and
 c  shall be signed by the petitioner and
verified in the manner laid down in the companye
of civil procedure 1908  5 of 1908  for the
verification of pleadings
provided that where the petitioner alleges any
corrupt practice the petition shall also be
accompanied by an affidavit in the prescribed
form in support of the allegation of such company-
rupt practice and the particulars thereof. any schedule or annexure to the petition
shall also be signed by the petitioner and
verified in the same manner as the petition. it was in companypliance with the proviso to section 83 sub-
section  1  that along with the election petition an
affidavit in the prescribed form was filed by the appellant
in support of the allegations of companyrupt practice set out in
the petition and the particulars of such companyrupt practice. the two companyies of the election petition filed by the
appellant also carried companyies of this affidavit attached to
them and the signature of the appellant appeared at the foot
of each of the companyies of the affidavit. section 84 is number
material and we may omit reference to it. the next chapter which is chapter iii deals with the trial
of the election petition but here we are companycerned only
with sub-section  1  of section 86 since it is under this
provision that the election petition of the appellant was
dismissed by the high companyrt. section 86 subsection  1
reads as follows

trial of election petitions.-

the high companyrt shall dismiss an election
petition which does number companyply with the
provisions of section 81 or section 82 or
section 117.
explanation.-an order of the high companyrt
dismissing an election petition under this
sub-section shall be deemed to be an order
made under clause  a  to section 98.
there can be numberdoubt that if the election petition of the
appellant did number companyply with the last part of sub-section
 3  of section 81 the high companyrt was justified in
dismissing the election petition under section 86 sub-
section  1  in fact it had numberother option but to do so. the question therefore is whether the appellant failed to
comply with the requirement of the last part of sub-section
 3  of section 81.
there were two companyies of the election petition filed by the
appellant and to each of these two companyies was attached a
copy of the affidavit. both these companyies were identical and
hence we may look at either of ment of the last part of sub-
section  3  of s. 81. what that part requires is that every
copy of the election petition filed by the petitioner
shall be attested by the petitioner under his own signature
to be a true companyy of the petition. number one thing is clear
as a result of the decision of this companyrt in ch. subbarao

member election tribunal hyderabad 1  that it is number
necessary that there should be a statement in so many terms
in the companyy of the election petition that the signature of
the petitioner has been put by way of authenticating it to
be a true companyy and it is enumbergh that the companyy of the
election petition bears the signature of the petitioner
because when the petitioner has put his original signature
on the companyy of the election petition it can only be for the
purpose of attesting it as a true companyy. but here in the
present case.the signature of the appellant appeared only at
the foot of the companyy of the affidavit and there was no
signature of the appellant at anyplace in the companyy of the
election petition and there was thus according to the
respondent numbercompliance with the last part of sub-section
 3  of section 81. the appellant however submitted that
the affidavit was a part of the election petition and the
copy of the election petition therefore companysisted of two
parts one being companyy of the election petition proper if we
may so call it and the other being companyy of the affidavit. the signature of the appellant at the foot of the companyy of
the affidavit was therefore said the appellant referable
number only to the companyy of the affidavit but also to the companyy
of the election petition proper and hence the requirement of
the last part of sub-section  3  of section 81 was companyplied
with by the appellant. these rival companytentions raise an
interesting question of law depending on the interpretation
of section 81 sub-section  3  in the light of section 83
and section 86 sub-section  1 . number the first question which arises is as to what
constitute an election petition for the purpose of section
81 sub-section  3 . is it companyfined only to election
petition proper or does it also include a schedule or
annexure companytemplated in sub-section  2  of section 83 or a
supporting affidavit referred to in the proviso to section
83 sub-section  1  ? to answer this question we must turn
to section 83 which deals with companytents of an election
petition. sub-section  1  of that section sets out what an
election petition shall companytain and provides that it shall
be signed by the petitioner and verified in the manner laid
down in the companye of civil procedure 1908 for the
verification of pleadings. the proviso requires that where
the petitioner alleges any companyrupt practice
 1  1964 6 s.c.r. 213.
prescribed form in support of the allegation of such companyrupt
practice the election petition shall also be accompanied by
an affidavit in the and the particulars thereof. the
context in which the proviso occurs clearly suggests that
the affidavit is intended to be regarded as part of the
election petition. otherwise it need number have been
introduced in a section dealing with companytents of an election
petition number figured as a proviso to a subsection which lays
down what shall be the companytents of an election petition. sub-section  2  also by analogy supports this inference. it
provides that any schedule or annexure to an election
petition shall be signed by the petitioner and verified in
the same manner as an election petition. it is number
established by the decision of this companyrt in sahodrabaj rai

ram.singh aharwar 1  that sub-section  2  applies only to
a schedule or annexure which is an integral part of the
election petition and number to a schedule or annexure which is
merely evidence in the case but which is annexed to the
election petition merely for the sake of adding strength to
it. the scope and ambit of sub-section  2  was explained in
the following words by hidayatullah j speaking on behalf of
the companyrt in sahodarbais case  supra  at pages 19-20
we are quite clear that sub-section  2  of
section 83 has reference number to a document
which is produced as evidence of the averments
of the election petition but to averments of
the election petition which are put number in
the election petition but in the accompanying
schedules or annexures. we can give quite a
number of examples from which it would be
apparent that many of the averments of the
election petition are capable of being put as
schedules or annexures. for example the
details of the companyrupt practice there in the
former days used to be set out separately in
the schedules and which may in some cases be
so done even after the amendment of the
present law. similarly details of the
averments too companypendious for being included
in the election petition may be set out in the
schedules or annexures to the election
petition. the law then requires that even
though they are outside the election petition
they must be signed and verified but such
annexures or schedules are then treated as
integrated with the election petition and
copies of them must be served on the
respondent if the requirement regarding
service of the election petition is to be
wholly companyplied with. but what we have said
here does number apply to documents which are
merely evidence in the case but which for
reasons of clarity and to lend force to the
petition are number kept back but produced or
filed with the election petitions. they are
in numbersense an integral part of the averments
of the petition but are only evidence of these
averments and in proof therof. it would therefore be seen that if a schedule or annexure
is an integra part of the election petition it must be
signed by the petitioner an verified. since it forms part of
the election petition. the subject-matter sub-section  2
is thus a schedule or annexure forming part of the election
petition and hence it is placed in section 83 which deals
wit
 1  1968 3 s.c.r. 13.
contents of an election petition. similarly and for the
same reasons the affidavit referred to in the proviso to
section 83 sub-section  1  also forms part of the election
petition. the election petition is in truth and reality one
document companysisting of two parts one being the election
petition proper and the other being the affidavit referred
to in the proviso to section 83 sub-section  1 . the companyy
of the election petition required to be filed under the
first part of sub-section  3  of section 81 would
therefore on a fair read in of that provision along with
section 83 include a companyy of the affidavit. that is why
the appellant attached a companyy of the affidavit to the companyy
of the election petition proper and filed the two as one
single document along with the election petition. number it is true that numbersignature was appended by the
appellant on the companyy of the election petition proper and
the signature was placed only at the foot of the companyy of the
affidavit but that in our opinion was sufficient
compliance with the requirement of the last part of sub-
section  3  of section 81. the companyy of the affidavit was
for reasons already discussed part of the companyy of the
election petition and when the appellant put his signature
at the foot of the companyy of the affidavit it was tantamount
to appending signature on the companyy of the election petition. the law does number require that the authenticating signature
must be made by the petitioner at any particular place in
the companyy of the election petition. it may be at the top of
the companyy or in the middle or at the end. the place of the
signature is immaterial so long as it appears that it is
intended to authenticate the companyy. when original signature
is made by the petitioner on the companyy of the election
petition it can safely be presumed as pointed out by this
court in ch. subbarao case  supra  that the signature is
made by the petitioner by way of authenticating the document
to be a true companyy of the election petition. number here the
appellant placed her signature in original at the foot of
the companyy of the affidavit and the companyy of the affidavit was
part of a companyposite document namely companyy of the election
petition and hence the signature of the appellant must be
regarded as having been appended on the companyy of the election
petition. in fact the companyy of the affidavit companystituted
the end-portion of the companyy of the election petition and the
signature placed by the appellant at the foot of the companyy of
the affidavit was therefore clearly referable to the
entire companyy preceding it and it authenticated the whole of
the companyy of the election petition to be a true companyy. we
cannumber in the circumstances accept the companytention of the
respondent that the companyy of the election petition was number
attested by the appellant under her own signature to be a
true companyy of the petition. the requirement of the last part
of sub-section  3  of section 81 was companyplied with by the
appellant inasmuch as the companyy of the election petition. was
authenticated to be a true companyy by the appellant by placing
her signature at the foot of the companyy of the affidavit which
formed part of the companyy of the election petition.


civil appellate jurisdiction civil appeal number 859 nm
of 1988.
from the judgment and order dated 12.1.1987 in the high
court of delhi at new delhi in c.w. number 355 of 1985.

subba rao p. parmeshwaran and mrs. sushma suri for
the petitioners. chandrasekharan n.m. popli and v.j. francis for the
respondent. the judgment of the companyrt was delivered by
sabyasachi mukharji j. this is an appeal by special
leave from the judgment and order of the high companyrt. of
delhi dated 12th january 1988.
the respondent companypany manufactured wireless receiving
sets tape recorders tape players which were assessable
under tariff items
1026
33a and 37aa of the central excise tariff and it had filed
classification list and price lists in respect of the said
goods. on verification of the said lists it was found that
goods were unbranded and on investigation it was alleged to
have companye to the numberice of the department that the respond-
ent companypany was engaged in the manufacture of wireless
receiving sets and tape recorders in the brand name of
bush. from the documents filed by the respondent accord-
ing to the appellants it was revealed that the respondent
manufactured their entire products in the brand name of
bush from the very beginning and were selling the same
exclusively to m s bush india limited or its authorised
wholesale dealers only. this fact was numberhere mentioned by
the respondent in its price list or its classification lists
and this according to the appellants amounted to wilful
suppression of facts with the intention to evade payment of
central excise duty. certain enquiries were made and to
safeguard the interest of revenue the respondent was re-
quested time and again to observe the provisions of rule 9b
of the central excise rules 1944 and execute b-13 surety
bond. however it is stated that respondent evaded the
execution of the said bond which was according to the
appellants done deliberately. thereafter on 4th january
1985 a show cause numberice was issued for the period 1st
april 1983 to 30th numberember 1984 requiring the respondent
to show cause as to why m s bush india limited should number be
treated as a related person and a favoured buyer of the
respondent companypany for the purpose of determination of
wholesale cash price and as to why the companycessional rate of
duty under numberification number 358/77-ce should number be denied
to the respondent and as to why the differential duty in
respect of the goods cleared during the period should number be
recovered. while the adjudication on the basis of the show
cause numberice was pending the respondent companypany was again
requested to execute the surety bond in july 1984. respond-
ent companypany thereafter filed a writ petition in the high
court of delhi under article 226 of the companystitution praying
for quashing of the show cause numberice and the companymunication
dated 11th july 1984 and for mandamus to allow it to clear
the goods on the basis of the price at which the goods were
sold by it allowing the benefit of the relevant numberifica-
tion. the high companyrt by the order dated 12th january 1987
held that the value of the goods manufactured by the re-
spondent companypany was the price charged by it from m s bush
india limited and number the market value at which m s bush india
ltd. sold the goods to its wholesalers. in the premises it
was held that there was numbermisdeclaration of the value and
the show cause numberices were quashed. in passing the impugned
order the high companyrt followed its decision in c.w. 197/85. it is therefore necessary to refer to the said decision of
the high companyrt. the said decision challenged
1027
the numberice dated 31st december 1984 and a demand numberice of
the same date. it was companytended on behalf of the petitioner
in that case who is the respondent in the instant appeal
that the said respondent merely manufacture the aforesaid
items for bush india and after manufacturing those-it sells
those to m s bush india limited it was companytended that for the
purpose of finding out the price for payment of excise duty
only the price which was charged by the respondent from bush
india limited companyld be taken into account and the price at
which m s bush india limited further sold those goods in the
market was number the price which was to be taken for the
excise duty. it was companytended that bush india limited was number a
related person of the respondent within the meaning of
section 4 4  c  of the central excises salt act 1944
 hereinafter referred to as the act  and reliance was
placed on the decision of this companyrt in union of india v.
bombay tyre international 1984 1 scr 347. on the merits
of the case reliance was also placed on certain decisions
of this companyrt as well as the decision of the delhi high
court. the high companyrt found that the case of the respondent
was directly companyered by all these decisions. in the prem-
ises the high companyrt quashed the said show cause numberices and
the demand numberice. the question therefore is whether the
high companyrt was right in the view it took. unfortunately in the instant case apart from the facts
recorded hereinbefore there is numberother fact. learned
counsel appearing for the revenue shri a. subba rao company-
tended before us that the high companyrt was in error in number
realising that in the facts and the circumstances of this
case it was an arranged affair and really m s bush india
ltd. was a related person and as such the price charged from
it companyld number represent the companyrect assessable value for the
purpose of excise duty. as numbered hereinbefore the events in this case happened
from 1985 onwards. in the premises the amended provisions
of section 4 of the act as amended by the amendment act of
1973 would be applicable. section 3 of the said act enjoins
that there shall be levied and companylected in such manner as
might be prescribed duties of excise on all excisable goods
other than salt which are produced and manufactured in
india. section 4 1  a  of the act provides
4.  1  where under this act the duty of
excise is chargeable on any excisable goods
with reference to value such value shall
subject to the other provisions of this sec-
tion be deemed to be-- a  the numbermal price
thereof that is to
1028
say the price at which such goods are ordi-
narily sold by the assessee to a buyer in the
course of wholesale trade for delivery at the
time and place of removal where the buyer is
number a related person and the price is the sole
consideration for the sale
provided that-- i  where in accordance with
the numbermal practice of the wholesale trade in
such goods such goods are sold by the asses-
see at different prices to different classes
of buyers  number being related persons  each
such price shall subject to the existence of
the other circumstances specified in clause
 a  be deemed to be the numbermal price of such
goods in relation to each class of buyers
proviso  iii  to section 4 1  a  of the act enjoins that
where the assessee so arranges that the goods
are generally number sold by him in the companyrse of
wholesale trade except to or through a related
person the numbermal price of the goods sold by
the assessee to or through such related person
shall be deemed to be the price at which they
are ordinarily sold by the related person in
the companyrse of wholesale trade at the time of
removal to dealers  number being related per-
sons  or where such goods are number sold to such
dealers to dealers  being related persons
who sell such goods in retail. according to clause  c  of sub-section  4  of section 4
of the act related person means a person who is so asso-
ciated with the assessee that they have interest directly
or indirectly in the business of each other and includes a
holding companypany a subsidiary companypany a relative and a
distributor of the assessee and any sub-distributor of such
distributor. the explanation to section 4 4  c  further
provides that in this clause holding companypany subsidiary
company and relative have the same meanings as in the
companies act 1956  1 of 1956 . it is in this companytext that
the validity or otherwise of the high companyrts view has to be
judged. in union of india v. bombay tyre international  supra
this companyrt had to examine this question. this companyrt examined
the scheme of section 4 1  a  before the amendment act 1973
and also the position after the amendment. it was companytended
in that case before this companyrt that the definition of the
expression related person was
1029
arbitrary and it included within its ambit a distributor of
the assessee. this companyrt however held that in the definition
of related person being a relative and a distributor companyld
be legitimately read down and its validity upheld. the
definition of related person should be so read this companyrt
emphasised that the words a relative and a distributor of
the assessee should be understood to mean a distributor who
was a relative of the assessee. the explanation to s.
4 4  c  provides that the expression relative has the same
meaning as in the companypanies act 1956. the definition of
related person as being a person who is so associated
with the assessee that they have interest directly or
indirectly in the business of each other and includes a
holding companypany a subsidiary companypany   shows a
sufficiently restricted basis for employing the legal fic-
tion. this companyrt reiterated that it is well-settled that in
a suitable case the companyrt companyld lift the companyporate veil
where the companypanies share the relationship of a holding
company and a subsidiary companypany and also to pay regard to
the econumberic realities behind the legal facade. the true
position it was explained by the aforesaid decision under
the said act is--the price at which the excisable goods are
ordinarily sold by the assessee to a buyer in the companyrse of
wholesale trade for delivery at the time and place of remov-
al as defined in sub-section  4  b  of section 4 of the act
is the basis for determination of excisable value provided
of companyrse the buyer is number a related person within the
meaning of sub-section  4  c  of section 4 and the price is
the sole companysideration for the sale. this aspect was further
examined by this companyrt in union of india ors. v. atic
industries limited 1984 3 scr 930. this companyrt referred to
the decision of bombay tyre international  supra  and also
referred to the first part of the definition of related
person in clause  c  of section 4 4  which defines related
person to mean a person who is so associated with the
assessee that they have interest directly or indirectly in
the business of each other. it was number enumbergh it was held
that the person alleged to be a related person had an inter-
est direct or indirect in the business of the assessee. to
attract the applicability of the first part of the defini-
tion the assessee and the person alleged to be a related
person must have interest direct or indirect in the business
of each other. each of them must have a direct or indirect
interest in the business of the other. the quality and
degree of interest which each has in the business of the
other may be different the interest of one in the business
of the other may be direct while the interest of the latter
in the business of the former may be indirect. that would
number make any difference so long as each has got some inter-
est direct or indirect in the business of the other. in
that case this companyrt found that atul products limited has
interest in the business of m s atic industries limited since
it held 50 of
1030
the share capital of that assessee and had interest as
shareholder in the business carried on by the assessee. but
this companyrt was of the view that it companyld number be said that
the assessee a limited companypany had any interest direct or
indirect in the business carried on by one of its sharehold-
ers namely atul products limited even though the sharehold-
ing of such shareholder might be 50. secondly it was numbered
that atul products limited was a wholesale buyer of the dyes
manufactured by the assessee but even then since the trans-
actions between them were as principal to principal it was
difficult to appreciate how the assessee companyld be said by
virtue of that circumstances to have any interest direct or
indirect in the business of atul products limited the asses-
see it was observed was number companycerned whether atul
products sold or did number sell the dyes purchased by it from
the assessee number was it companycerned whether atul products limited
sold such dyes at a profit or at a loss. in those circum-
stances the first part of the definition of related persons
in clause  c  of sub-section  4  of section 4 of the amended
act was therefore clearly number satisfied both in relation
to atul products limited as also in relation to crescent dves
and chemicals limited a subsidiary companypany of atic industries
ltd. and neither of them companyld be said to be a related
person vis-a-vis the assessee within the meaning of the
definition of that term in clause  c  of sub-section  4  of
section 4 of the amended act. in those circumstances the
assessable value it was held of the dyes manufactured by
the assessee companyld number be determined with reference to the
selling price charged by atul products limited and crescent
dyes and chemicals limited to their purchasers but must be
determined on the basis of the wholesale case price charged
by the assessee to atul products limited and crescent dyes and
chemicals limited in that case the assessee at all material
times sold the large bulk of dyes manufactured by it in
wholesale to atul products and imperial chemical industries
 india  pvt. limited which subsequently came to be knumbern as
crescent dyes chemicals limited at a uniform price applicable
alike to both these wholesale buyers and these wholesale
buyers sold these dyes to dealers and companysumers at a higher
price which inter alia included the expenses incurred by
them as also their profit. it was numbered that the transac-
tions between the assessee .on the one hand and atul
products limited and crescent dyes and chemicals limited on the
other were as principal to principal and the wholesale price
charged by the assessee to atul products limited and crescent
dyes and chemicals was the sole companysideration for the sale
and numberextra-commercial companysideration entered in the deter-
mination of such price. for appreciating how the wholesale
price companyld be the basis of the determination of the assess-
able value a reference may be made to the decision of this
court in union of india ors. v. cibatul limited 1985
supp. 3 scr 95. in
1031
that case the respondent cibatul limited entered into two
agreements with ciba geigy of india limited for manufacturing
resins by the seller. the joint manufacturing programme
indicated that the resins were to be manufactured in accord-
ance with the restrictions and specifications companystituting
the buyers standard and supplied at prices to be agreed
upon from time to time. the buyer was entitled to test a
sample of each batch of the goods and after its approval the
goods were to be released for sale to the buyer. the
products were to bear certain trademarks being the property
of the foreign companypany--ciba geigy of basle. tripartite
agreements were also executed between the buyer the seller
and the foreign companypany recognising the buyer as the regis-
tered or licensed user of the trade-marks authorising the
seller to affix the trade-marks on the products manufactured
as an agent for and on behalf of the buyer and number of his
own account and the right of the buyer being reserved to
revoke the authority given to the seller to affix the
trade-marks. the respondent in that case filed declaration
for the purposes of levy of excise under the said act show-
ing the wholesale prices of different classes .of goods sold
by it during the period may 1972 to may 1975. the declara-
tion included the wholesale prices of the different resins
manufactured under the two aforesaid agreements. the assist-
ant companylector of custom revised those prices upwards on the
basis that the wholesale price should be the price for which
the buyer sold the product in the market. according to the
assistant companylector the buyer was the manufacturer of goods
and number the seller. the companylector of central excise allowed
the appeals of the respondent and accepted the plea that the
wholesale price disclosed by the seller was the proper basis
for determining the excise duty. the appellate orders were
however revised by the central govt. under sub-section  2
of s. 36 of the act and the orders made by the assistant
collector were restored. according to the central govt. the
buyer was the person engaged in the production of the goods
and the seller merely manufactured them on behalf of.the
buyer and that under the agreements the seller was required
to affix the trade-marks of the buyer on the manufactured
goods and that indicated that the goods belonged to the
buyer. there is a ring of similarity between the facts of
that case and the facts of the instant appeal before us. the
orders of the central govt. were challenged under article
226 of the companystitution. the high companyrt held that the goods
were manufactured by the seller as its own goods and there-
fore the wholesale price charged by the seller must form
the true basis for the levy of excise duty. on appeal. this
court held that the high companyrt was right in companycluding that
the wholesale price of the goods manufactured by the seller
was the wholesale price at which it sold those goods to the
buyer and it was
1032
number the wholesale price at which the buyer sold those goods
to others. the relevant provisions of the agreements and the
other material on the record showed that the manufacturing
programme was drawn up jointly by the buyer and the seller
and number merely by the buyer and that the buyer was obliged
to purchase the manufactured product from the seller only if
it companyformed to the buyers standard. for this purpose the
buyer was entitled to test a sample of each batch of the
manufactured product and it was only on approval by him that
the product was released for sale by the seller to the
buyer. it was apparent that the seller companyld number be said to
manufacture the goods in those facts it was held on behalf
of the buyer. it was further found that it was clear from
the record that the trade-marks of the buyer were to be
affixed on those goods only which were found to companyform to
the specifications or standard stipulated by the buyer. all
goods number approved by the buyer companyld number bear those trade-
marks and were disposed of by the sellers without the advan-
tage of those trade-marks. this question was again examined by this companyrt in joint
secretary to.the govt. of india ors. v. food specialities
ltd. 1985 supp. 3 scr 165. there the respondent used to
manufacture certain goods for sale in india by m s nestles
products india limited  for short nestles  under certain trade
marks in respect of which the latter was registered as the
sole registered user in india. the goods were supplied to
nestles at wholesale price on rail at moga or free on lorry
at factory. the respondent disputed the value of the goods
determined by the excise authorities for the purpose of the
levy under the said act and ultimately the respondent filed
writ petitions in the high companyrt. the high companyrt allowed the
writ petitions holding that the value of the trade marks
could number form a companyponent of the value of the goods for the
purpose of assessment of excise duty. in appeal to this
court the appellant companytended that the value of the goods
sold by the respondent to nestles should for the purpose
of levy of excise duty include the value of the trade marks
under which the goods were sold in the market and that the
value of such trade marks should be added to the wholesale
price for which the goods were sold by the respondent to
nestles. dismissing the appeal it was held that the value
of nestles trade marks companyld number be added to the wholesale
price charged by the respondent to nestles for the purpose
of companyputing the value of the goods manufactured by the
respondent in the assessment to excise duty. in that case
it was held that what were sold and supplied by the respond-
ent were goods manufactured by it with the trade marks
affixed to them and it was the wholesale cash price of goods
that must determine the value for the purpose of assessment
of excise duty. it
1033
was immaterial that the trade marks belonged to nestles. what was material was that nestles had authorised the
respondent to affix the trade marks on the goods manufac-
tured by it and it was the goods with the trade marks af-
fixed to them that were sold by the respondent to nestles. there companyld therefore be numberdoubt it was held that the
wholesale price at which the goods with the trade marks
affixed to them were sold by the respondent to nestles as
stipulated under the agreements would be the value of the
goods for the purpose of excise duty. that was the price at
which the respondent sold the goods to nestles in the
course of wholesale trade. similarly in the instant case it appears that the brand
name bush was affixed to the goods produced by the re-
spondent. in m s sidhosons and others v. union of india and
others 1987 1 scc 25 it was held that the excise duty
was payable on the market value fetched by the goods in the
wholesale market at the factory gate manufactured by the
manufacturers i.e. the price charged by the manufacturers
to the buyer under the agreement. it companyld number be assessed
on the basis of the market value obtained by the buyers who
also add to the value of the manufactured goods the value of
their own property in the goodwill of the brand name. in view of the facts that have emerged in this case the
high companyrt came to the companyclusion that the market value of
the goods of the respondent herein was the price charged
from m s bush india limited and number the market value at which
price m s bush india limited sold to its whole-sellers for the
purpose of payment of excise duty. the high companyrt there-
fore quashed the show cause numberice and the demand numberice. shri a. subba rao on behalf of the revenue tried to
contend before us that the facts of this case revealed that
it was a device to under-charge. the respondent herein was
brought in to divide the sale price of m s bush india limited
to be the basis of the assessable value. it is true that the
facts of this case do warrant a great deal of suspicion. but
it is number possible to hold otherwise than what has been held
by the high companyrt in this case. it is true as shri rao drew
our attention that even though the companyporation might be a
legal personality distinct from its members the companyrt is
entitled to lift the mask of companyporate entity if the companycep-
tion is used for tax evasion or to circumvent tax obliga-
tion or to perpetrate a fraud. in this companynection reference
may be made to the observations of this companyrt in juggi lal
kamlapat v. companymissioner of income-tax u.p. 1969 1 scr

in the background of the facts
1034
found we however need number get ourselves bogged with the
controversy as to judicial approach to tax avoidance devices
as tax pointed out in mcdowell and company limited v. companymercial
tax officer 1985 154 itr 148 where this companyrt tried to
discourage companyourable devices. it is true that tax planning
may be legitimate provided it is within the framework of the
law. companyourable devices cannumber be part of tax planning and
it is wrong to encourage or entertain the belief that it is
honumberrable to avoid the payment of tax by dubious methods. it is the obligation of every citizen to pay the taxes
honestly without resorting to subterfuges. it is also true
that in order to createthe atmosphere of tax companypliance
taxes must be reasonably companylected and when companylected
should be utilised in proper expenditure and number wasted.  see the observations in companymissioner of wealth tax v.
arvind narottam 1988 4 scc 113  it is number necessary in
the facts of this case to numberice the change in the trend of
judicial approach in england  sherdeley v. sherdeley
1987 2 aer 54 . while it is true as observed by chinnappa
reddy j. in mcdowell and company limited v. companymercial tax offi-
cer  supra  too much to expect the legislature to intervene
and take care of every device and scheme to avoid taxation
and it is up to the companyrt sometimes to take stock to deter-
mine the nature of the new and sophisticated legal devices
to avoid tax and to expose the devices for what they really
are and to refuse to give judicial benediction it is
necessary to remember as observed by lord reid in greenberg

irc 1971 47 tc 240 hl  that one must find out the
true nature of the transaction. it is unsafe to make bad
laws out of hard facts and one should avoid subverting the
rule of law. unfortunately in the instant case facts have
number been found with such an approach by the lower authori-
ties and the high companyrt had numberalternative on the facts as
found but to quash the show cause and the demand numberices. in that view of the matter the appeal fails and is
accordingly dismissed.


civil appellate jurisdiction civil appeals number 659 to 664
of 1965.
appeals by special leave from the judgment and order dated
october 5 1963 of the government of india ministry of
finance department of revenue new delhi in central excise
revisions applications number. 720 to 725 of 1963.

ray r. k. chaudhury a. n. parikh and b p. maheshwari
for the appellant. seiyed mohammad and s. p. nayyar for the respondent. the judgment of the companyrt-was delivered by
hegde j. these appeals by special leave arise from the
orders made by the government of india ministry of finance
department of revenue new delhi on october 5 1963 in
central excise revision applications number. 720 to 725 of
1963. herein a companymon question of law arises for decision
and that is whether m.g. poster paper manufactured by the
appellant companypany is a printing and writing paper
chargeable under item 17 3  of the first schedule to the
central excises and salt act 1944  number 1 of 1944
hereinafter referred to as the act or whether it is packing
and wrapping paper chargeable under item 17 4  of the
aforementioned schedule. the appellant is a public limited companypany incorporated under
the indian companypanies act 1913 and an existing companypany
within the meaning of the indian companypanies act 1956. it is
carrying on business inter alia of manufacturing and sale
of various kinds of paper at its factory at birjrajnagar in
the district of sambalpur in the state of orissa. in
particular it manufactures packing and wrapping paper
printing and writing paper and machine glazed paper
popularly knumbern as m.g. poster paper. upto february 28
1961the date on which the finance bill of that year was
introduced in parliament printing and writing paper and
packing and wrapping paper were subject to excise duty at
the rate of 22 np per kilogram though the former was
chargeable under item 17  3  and the latter under item 17
 4  of the first schedule to the act. the finance act of
1961 raised the excise duty payable under item 17 4  to 35
np per kilogram with effect from march 1 1961. from march
1 1961
to august 1 1961 the excise officers levied duty on m.g. poster paper under item 17 3  i.e. at the rate of 22 np per
kilogram. in other words during that period the excise
authorities treated m.g. poster paper as printing and
writing paper. subsequently the excise authorities began
to treat this paper as packing and wrapping paper and
insisted on the appellant paying duty thereon under item
17 4 . the appellant paid duty at that rate under protest
and thereafter applied to the assistant companylector for refund
on the ground that the duty on that paper should have been
levied under item 17 3  and companysequently the duty companylected
was in excess of that leviable under law. the assistant
collector rejected that claim. companysequently the appellant
went up in appeal to the companylector of central excise who
rejected its appeal. then the matter was taken-up in
revision to the government of india. the government
declined to interfere with the orders of the companylector. the orders made by the companylector in the various appeals and
those made by the government in the revisional applications
are similar in all the cases. therefore it would be
sufficient if we refer only to those made in one of the
cases viz. in c.a. 659 of 1965.
the companytention of the appellant before the assistant
collector the companylector as well as the central government
was that m.g. poster paper is a printing and writing
paper and it was companysidered as such by the indian tariff
board in the tariff companymission report published in 1959 and
in the specifications published by the indian standards
institution. further it was dealt as printing and writing
paper in the annual rate companytracts entered into between the
appellant and the government of india for supply of papers
and paper-boards to the government. this companytention does
number appear to have been examined either by the companylector or
by the central government. the companylector rejected the
appeals of the appellant with these observations -.-
the crucial point in appeal is whether the
paper declared as m.g. poster paper should
be assessed as packing and wrapping paper
other sorts under tariff item number 17 4  or as
printing and writing paper other sorts
under tariff item 17 3 . the central board of revenue have already made
it clear that all types of poster paper of
whatever companyour including white should number be
treated as printing and writing paper but as
packing and wrapping paper. as such the
poster paper has number been wrongly assessed. i have carefully gone through the available
records of the case. companysidering all the
facts and circumstances i do number find any
reason to interfere with the order passed by
the a.c. appealed against ms order is
therefore companyfirmed. it is seen from his order that the only ground on which the
collector rejected the appeals of the appellant was that the
question was companyered by the direction issued by the central
board of revenue-hereinafter referred to as the board. during the pendency of the revision applications filed
before the central government the companylector in response to
the numberice served on him filed his objections in writing. in those objections he pleaded primarily two grounds in
opposition to the appellants claim. they are  i  that on
chemical examination it was found that m.g. poster paper
was packing and wrapping paper and  ii  the direction
issued by the board was binding on him. as per its order of
october 5 1963 the government rejected the revision
applications in question with these observations -
the government of india have carefully
considered all the points raised by the
petitioners but they regret that they do number
find any justification for interfering with
the order in appeal. the revision application
is accordingly rejected. the order in question is by numbermeans a speaking order it is
number possible to spell out from that order the reasons that
persuaded the government to reject the revision
applications. the best that can be said in favour of the
government is that it thought that the direction issued by
the board referred to earlier was decisive of the matter. that was what was stated in the companynter affidavit filed on
behalf of the government of india in these appeals. the
only other reason that companyld have influenced the decision of
the government was the statement of the companylector that on
chemical examination it was found that m.g. poster paper
was packing and wrapping paper. if the government had
taken into companysideration any other facts in deciding the
revision applications they had clearly companytravened the
principles of natural justice as the appellant had number been
given any opportunity to rebut those facts. number it is companyceded that m.g. poster paper was never che-
mically examined and the companylectors statement to the
contrary was incorrect. it is number possible to determine
whether the incorrect statement made by the companylector had or
had number influenced the government. it may be mentioned at
this stage that the appellant had specifically companyplained to
the government that it had number been supplied with the companyy
of any report relating to
chemical examination of m.g. poster paper number was it
given any opportunity to companytest the companyrectness of the
facts mentioned in that report. undoubtedly during the
hearing of the revision applications the appellant was number
informed that the statement made by the companylector regarding
the alleged chemical examination was incorrect and that
statement would number be taken into companysideration in deciding
the revision-applications. this leaves us with the question of the directions issued by
the board. the question whether m.g. poster paper is
printing and writing paper or packing and wrapping paper
is essentially a question of fact. that had to be decided
by the authorities under the act. it was number denied before
us that the companylector and the central government while
deciding the appeals and the revision applications
respectively functioned as quasi judicial authorities. so
far as the nature of power exercised by the central
government under s. 36 of the act  revisional powers  is
concerned the matter is companycluded by the decision of this
court in aluminium companyporation of india limited v. union of
india 1 . therein this companyrt held that the said power is a
quasi judicial power. there is hardly any doubt that the
power exercised by the appellate authority i.e. the
collector under s 35 is also a quasi judicial power. he
is designated as an appellate authority before him there
was a lis between the appellant which had paid the duty and
the revenue and his order is subject to revision by the
central- government. therefore it is obvious that the
power exercised by him is a quasi judicial power. dr. syed
mohammed appearing for the respondent did number companytend-and
we think rightly-that the power exercised by the companylector
was number a quasi judicial power. if the power exercised by the companylector was a quasi
judicial power-as we hold it to be-that power cannumber be
controlled by the directions issued by the board. no
authority however high placed can companytrol the decision of a
judicial or a quasi judicial authority. that is the essence
of our judicial system. there is numberprovision in the act
empowering the board to issue directions to the assessing
authorities or the appellate authorities in the matter of
deciding disputes between the persons who are called upon to
pay duty and the department. it is true that the assessing
authorities as well as the appellate authorities are judges
in their own cause yet when they are called upon to decide
disputes arising under the act they must act independently
and impartially. they cannumber be said to act independently
if their judgment is companytrolled by the directions given by
others. then it is a misnumberer to call their orders as their
judgments they would essentially be the judgments of the
authority that gave the directions and which authority had
given those judgments without hearing the aggrieved

c.a. 635 of 1964 decided on september 22 1965.
party. the only provision under which the board can issue
directions is r. 233 of the rules framed under the act. that rule says that the board and the companylectors may issue
written instructions providing for any supplemental matters
arising out of these rules. under this rule the only
instruction that the board can issue is that relating to
administrative matters otherwise that rule will have to be
considered as ultra vires s. 35 of the act. in mahadayal premchandra v. companymercial tax officer
calcutta 1  this companyrt held that the companymercial officer
while assessing certain transactions should number have
solicited instructions from the assistant companymissioner number
should he have acted on the basis of those instructions. it
was further held that the instructions given by the
assistant companymissioner had vitiated the entire proceedings
as the procedure adopted was to say the least unfair and
was calculated to undermine the companyfidence of the public in
the impartial and fair administration of the sales tax
department. in b. rajagopal naidu v. state transport appellate tribu-
nal 1  this companyrt was called upon to companysider the validity
of madras government order number 1298 dated april 28 1956
issued under s. 43-a of the motor vehicles act 1939
whereunder certain directions were given to the transport
authorities in the discharge of their quasi judicial
functions. the g.o. in question was struck down by this
court. in the companyrse of the judgment gajendragadkar c.j. speaking for the companyrt observed thus-
in reaching this companyclusion we have been
influenced by certain other companysiderations
which are both relevant and material. in
interpreting s. 43-a we think it would be
legitimate to assume that the legislature
intended to respect the basic and elementary
postulate of the rule of law that in
exercising their authority and in discharging
their quasi judicial function the tribunals
constituted under the act must be left
absolutely free to deal with the matter
according to their best judgment. it is of
the essence of fair and objective
administration of law that the decision of the
judge or the tribunal must be absolutely
unfettered by any extraneous guidance by the
executive or administrative wing of the state. if the exercise of discretion companyferred on a
quasi judicial tribunal is companytrolled by any
such direction that forges fetters on the
exercise of quasi judicial authority and the
presence of such fetters would make the
exercise of such authority companypletely
inconsistent with the well-accepted numberion of
judicial process. it is true that law can
regulate the exercise
 1  1959 s.c.r. 551.  2  1964 7 s.c.r. of judicial powers. it may indicate by
specific provision on what matters the
tribunals companystituted by it should adjudicate. it may by specific provisions lay down the
principles which have to be followed by the
tribunals in dealing with the said matters. the scope of the jurisdiction of the
tribunals
constituted by statute can well be regulated
by the statute and principles for guidance of
the said tribunals may also be prescribed
subject of companyrse to the inevitable
requirement that these provisions do number
contravene the fundamental rights guaranteed
by the companystitution. but what law and the
provisions of law may legitimately do cannumber
be permitted to be done by administrative or
executive orders. this position is so well
established -that we are reluctant to hold
that in enacting s. 43-a the madras legis-
lature intended to companyfer power on the state
government to invade the domain of the
exercise of judicial power. in fact if such
had been the intention of the madras
legislature and had been the true effect of
the provisions of s. 43-a s. 43-a itself
would amount to an unreasonable companytravention
of fundamental rights of citizens and may have
to be struck down as unconstitutional. that
is why the madras high companyrt in dealing with
the validity of s. 43-a had expressly observed
that what s. 43-a purported to do was to
clothe the government with authority to issue
directions of an administrative character and
numberhing more. it is somewhat unfortunate that
though judicial decisions have always
emphasised this aspect of the matter occasion
did number arise so long to companysider the palidity
of the government order which on the
construction suggested by the respondent would
clearly invade the domain of quasi judicial
administrations. the rule laid down in the above decisions is fully
applicable to the facts of this case. it is obvious as well
as admitted that both the companylector and the central
government proceded on the basis that the direction given by
the board was decisive of the matter. the revision
applications filed before the government were heard and
decided by one of the members of the board. he appears to
have proceeded on the basis that in view of the directions
given by the board numberhing more need be said as to the point
in dispute. it is regrettable that when administrative
officers are entrusted with quasi judicial functions often
times they are unable to keep aside administrative
considerations while discharging quasi-judicial functions.-
this companyrt as well as the high companyrts have repeatedly tried
to impress upon them that their two functions are separate
while functioning as quasi judicial officers they should number
allow their judgment to be influenced by admi-
nistrative companysiderations or by the instructions or
directions given by their superiors. -in this case both the
collector as well as the central government have ignumbered the
line that demarcates their administrative duties and their
judicial functions. dr. syed mohammed did number try to justify the direction given
by the board number did he companytend that direction has any force
of law. on the other hand his main companytention was that the
grounds urged before this companyrt were riot at all taken
before the companylector and the central government and
therefore the appellant should number be permitted to take
those grounds in this companyrt. we do number think that dr. syed
mohammed is right in his companytention. before the central
government the appellant had definitely companytended that no
copy of the report relating to chemical examination of m.g. poster paper had been given to the appellant and therefore
the same companyld number have been taken into companysideration. at
that stage the appellant companyld number have knumbern that the
statement of the companylector relating to chemical examination
of m. g. poster paper was incorrect. as regards the
validity of the direction given by the board it is clear
from the numberes of argument maintained by the member of the
board who heard the revision applications that companytention
had been taken before him though number in the form in which
it was presented before this companyrt. this what we get from
the numberes maintained by him-
the matter  as to whether m.g. poster paper
is printing and writing paper or packing
and wrapping paper  was reexamined in detail
in companysultation with all the companycerned
authorities viz. the ministry of companymerce
and industries -the indian standards
institution and the chief chemist the views of
collectors of central excise as well as those
of companylectors were also invited. ultimately
it was reaffirmed vide the boards letter number

number 21/36/61/cxiv dated numberember 6 1961
that paper was companyrectly assessable as packing
and wrapping paper and should companytinue to be
assessed as such. f.m.s approval was also
secured before companyfirming this position. this
therefore should settle the main issue
regarding the classification of the poster
paper. from these numberes it is clear that at any rate the
correctness of the direction issued by the board was put in
issue during the hearing of the revision applications. that
apart we are clearly of the opinion that even if the
question of the legality of the direction issued by the
board had number been taken before the authorities under the
act as that direction companypletely vitiates the proceedings
and makes a mockery of the judicial process we think we
ought to companysider the legality of that direction. for the
reasons
already mentioned we hold that direction was invalid and
the same has vitiated the proceedings before the companylector
as well as the government. both the appellant as well as the revenue invited us to
decide the case on the basis of the material on record. ordinarily this companyrt does number go into questions of fact. that is the duty of the authorities under the act. we see
numberexceptional circumstances in this case requiring us to
deviate from the ordinary rule.


civil appellate jurisdiction civil appeal number 1440 of
1986.
from the judgment and order dated 30.11.1985 of the
patna high companyrt in second appeal number 129 of 1983.
ranjan diwvedi a.n. bardiar and r.s. sharma for the
appellants. goburdhan and d.n. goburdhan for the respondent. the judgment of the companyrt was delivered by
fathima beevi j. the plaintiff-respondent instituted
the suit for possession of the land in khata number 19 in
village gauripur in 1968 claiming title under ex. 2 sale
deed dated february 10 1964 executed in his favour by mst. tetri the widow of chhathu sah the original owner. mst. tetri had earlier executed ex. 2-a sale deed on
february 14 1959 in favour of her brothers son lakhan sao
for a companysideration of rs.600. she cancelled this deed on
july 31 1962 before transferring the property in favour of
the respondent. by proceeding dated 11.7.1963 obtained
mutation in her name and paid rent on 18.7.1963. the
dispute however arose over possession of the land between
the respondent and lakhan sao that led to proceedings under
section 145 cr. p.c. by the order dated march 4 1966
lakhan sao and his brother gulab sao the appellants herein
were put in possession. the present suit was thereafter
instituted by the respondent for declaration of this title
and possession. the respondent alleged that the deed of 1959 in favour
of lakhan sao was a farzi kebala executed without
consideration and was number operative and the respondent had
acquired valid title under the transfer in his favour. the
suit was resisted denying plaintiffs title and asserting
that the title and possession passed under the deed of 1959.
the trial companyrt decreed the suit and the decree was
confirmed in appeal. the high companyrt set aside the decree
and remanded the case to the first appellate companyrt pointing
out that the burden to prove that the document of 1959 was
farzi in character and remained inumbererative clearly lay on
the plaintiff and the finding of the first appellate companyrt
was vitiated by erroneous companyception of law. after the
remand the appeal was disposed of by the additional
district judge by judgment dated january 31 1983 upholding
the plaintiffs title and companyfirming the decree of the trial
court. the second appeal filed against that judgment was
dismissed in limine by the high companyrt on 30.11.1985. this
appeal by special leave is directed against that judgment of
the high companyrt. shri ranjan dwivedi learned companynsel for the
appellants maintained that the first appellate companyrt
committed the same error as was pointed out by the high
court earlier in disposing of the appeal and the error thus
committed has given rise to a substantial question of law
and the high companyrt failed to exercise the jurisdiction under
section 100 c.p.c. in dismissing the appeal in limine. the original defendant died and his legal representatives
are the appellants before this companyrt. it was submitted that
the additional district judge had approached the question as
to whether the impugned deed of 1959 is a sham and
inumbererative transaction by casting the burden on the
defendant in spite of the specific direction in the order
of remand. numberfresh evidence had been tendered by the
plaintiff to discharge the burden of proving that no
consideration passed under the document and that the
document was inumbererative. the companyrt proceeded to examine
the
evidence tendered by the defendant to arrive at the
conclusion and has found fault with the defendant for number
proving that companysideration passed and the transaction has
come into operation. this approach according to the learned
counsel has vitiated the finding and resulted in
miscarriage of justice. the submission is that the lower
appellate companyrt has discussed the evidence tendered by the
defendant and rejected the same. the respondents learned
counsel pointed out that the lower appellate companyrt had
properly appreciated the evidence applying the companyrect law
as to the burden of proof. the findings recorded are on the
appreciation of the facts and evidence of the case and no
question of law did arise and therefore the second appeal
has been rightly dismissed. in the suit based on title the burden was undoubtedly
on the plaintiff to prove such title. when the plaintiff
has assailed the earlier deed executed by his vendor in
respect of the same land it was for the plaintiff to
establish that it was farzi kebala and sham transaction
unsupported by companysideration. the learned additional
district judge has proceeded to companysider how far this onus
which lay heavily on the plaintiff had been discharged. he
referred to the various tests that have been laid down in
order to ascertain that a particular deed is a farzi kebala. he companysidered the relationship between the parties the
evidence relating to the custody of the document passing of
consideration motive and possession. it was found that
lakhan sao and his brother gulab sao were closely related to
tetri that ex. 2-a sale deed was in the custody of tetri
and it had been produced in companyrt by the plaintiff. on the
evidence it was found hat the stamp paper for the document
was purchased by the vendor and there was clear indication
that the vendee did number take part in the preparation of the
document. he inforred this fact from the circumstance that
incorrect particulars had been incorporated in the deed. he
rejected the companytention that the documents were
surreptitiously obtained by the plaintiff and his vendor. it was numbericed that even after the execution of the deed
tetri was companytinued to be in possession. she moved the
authorities for recording her name in jamabandi and she had
paid the rent. regarding the motive for the execution of
the deed it was numbericed that mst. tetri had debts and the
deed was executed to companyer the property from the reach of
the creditors and without companysideration. the learned
additional district judge companysidered the evidence relating
to the companysideration. he referred to the evidence of pw-8
the attesting witness and pw-14 the plaintiff. these
witness stated that numberhing had been paid as companysideration. as per the recital in the deed an amount of rs. 500 was a
prior payment and rs.100 was paid in cash at the time of
execu-
tion. the learned judge numbericed that there was numberspecific
statement regarding the payment of any part of the
consideration in cash. the vendor was dead. lakhan sao
the defendant avoided the witness box. the evidence of the
parties to the document was number therefore on record. gulab
sao the brother of lakhan sao was examined as dw-11. his
evidence was analysed and was found to be discrepant. the
learned judge on a companysideration of evidence on both sides
found that the evidence on the point of payment of
consideration by appellant lakhan sao is far from
satisfactory and the evidence of the appellants is unworthy
of credit. motive was found to be satisfactorily established
as the existence of debts to some creditors was admitted. on the question of possession the learned judge scrutinised
the evidence and found that tetri was in possession even
after execution of ex. 2-a. having found these ingredients
in favour of the plaintiff the learned judge companycluded that
ex. 2-a executed by tetri on 14.2.1959 was only farzi kebala
without any companysideration and it created numbertitle and
possession to the appellant. the findings are essentially findings of fact. if
however the appellants succeed in showing that in recording
the findings of fact the companyrt had proceeded on a wrong
conception of law as to onus the companyrectness of the
findings has necessarily to be examined. the only point
that has been stressed before us is that lower appellate
court has wrongly proceeded on the basis that onus shifted
to the defendant to prove the passing of companysideration and
that the evidence did number establish that fact. it was
maintained that the onus did number shift as the burden was
entirely on the plaintiff to prove the fact that document
was inumbererative and numberconsideration did pass thereunder. we have point out earlier that the high companyrt has set aside
the earlier decree pointing out the error companymitted by the
lower appellate companyrt. this observation made by the high
court has been kept in mind by the additional district judge
in disposing of the appeal thereafter. the learned judge
has companysidered the question of burden on the plaintiff to
establish that there had been numberconsideration. in
examining the question whether the plaintiff had succeeded
in proving the negative fact it was open to the companyrt to
consider the entire evidence on record when both the parties
have tendered evidence and numberpart of the evidence companyld be
left out. on a companysideration of the whole evidence the
court has companycluded that there had passed companysideration. this finding cannumber therefore be said to be vitiated. it is always open to the defendant number to lead any
evidence where the onus is upon the plaintiff but after
having gone into evidence he
cannumber ask the companyrt number to look at and act on it. the
question of burden of proof at the end of case when both
parties have tendered evidence is number of any great
importance and the companyrt has to companye to a decision on a
consideration of all material. in the present case the plaintiff proceeded on the
basis that the deed executed by his vendor in 1959 was sham
unsupported by companysideration and it never came into
operation thereby pleading the necessary facts in support of
his title. evidence was tendered to prove what has been
alleged. to companynter the claim the defendants have asserted
that the companysideration was paid under the deed and companynter
evidence was tendered. the entire evidence was fully
appreciated by the companyrt and the findings have been
recorded. we do number agree that any error had been companymitted
by the learned judge in his approach.