JUDGMENT <NAME>, J.

1. This is a Revision Petition by the first defendant against the order of the District <NAME> of Poonamallee in O.S. No. 247 of 1932 adding the present first respondent as third plaintiff. The ground on which the first respondent asked to be added was that his maternal uncle had undertaken to finance the plaintiffs' suit, that there was an agreement that in the event of their winning the plaintiffs should convey to the maternal uncle a half share in the immoveable suit properties and pay half the moneys that they might recover from the defendant for costs and mesne profits. On the death of his maternal uncle while the litigation was proceeding he (respondent) took his uncle's place and the plaintiffs confirmed the agreement. He said he apprehended that the first plaintiff was about to withdraw from the suit without his intervention. The learned District <NAME> allowed the request. "Petitioner claims derivative interest in the suit properties and opposes the withdrawal of first plaintiff from the suit. Second plaintiff supports this petitioner and I think that the petitioner must be added as a party especially in view of the conduct of the first plaintiff in the suit. It is likely that this petitioner will conduct the suit through if added and the real state of affairs can be ascertained so as to completely adjudicate upon the matters in dispute. <CITATION> (1925) L.R. 52 I.A. 211 : I.L.R. 6 Lah. 388 : 50 M.L.J. 118 (P.C.), supports petitioner ". This order was passed after opposition by the present petitioner. The case quoted by the learned District <NAME> is said to be <CITATION> (1925) L.R. 52 I.A. 211 : I.L.R. 6 Lah. 388 : 50 M.L.J. 118 (P.C.). It s a decision of <ORG> and is in fact completely against the view which he takes. In that case to use their Lordships' words:

Certain persons who might have been respondents hacked up the plaintiff and were added as plaintiffs, a very unnecessary proceeding, as no decree could pass in their favour.

2. An appeal had been preferred in that case to <ORG> by one <NAME> and others and in the judgment their Lordships said they would humbly advise His Majesty to allow the appeal and pronounce judgment in favour of the plaintiff. On the judgment being presented to His Majesty in <ORG> for embodiment in the formal order, the word "appellants" in the plural was used. So, the plaintiff and appellant, <NAME> presented a petition to have the order made rescinded and an order pronounced in favour of herself alone. Their Lordships said that the petition must be granted in so far as it prays to have the order in <ORG> made to conform to the judgment pronounced. They also said that by the expression "plaintiff" they meant to denote <NAME> alone without the addition of the other appellants. Their Lordships say:

It is out of the question that persons who assert that they have a derivative interest in the state of a suit can, by getting added as plaintiffs, be associated in a decree in favour of the person who has the only real title. Here although the persons possessing a derivative interest had got themselves added as plaintiffs their Lordships refused to allow them to figure in the decree.

3. As to the meaning of the expression "all the questions involved in the suit" in Order 1, Rule 10(2), Civil Procedure Code, which the learned District Munsif presumably had in mind in passing the order, the elaborate judgment of <NAME>, J., in <CITATION> for Hindu Religious Endowments, Madras (1926) I.L.R. 50 Mad. 34 : 51 M.L.J. 148 may be consulted. That was a case where the head of a mutt sued the Commissioners appointed under the Madras Hindu Religious Endowments Act for a declaration that the said Act was invalid and ultra vires, and an application was made to add <NAME> for India a party. The learned Judge says at page 40, If the expression in this clause had not been the word 'necessary', but merely 'desirable' a great deal might have been said for the argument adduced in support of the application. But at no stage of the discussion was I able to understand and the learned gentlemen that argued in support of the application to make out that the presence before the <ORG> of <NAME> was necessary * * *. The expression therefore 'all the questions involved in the suit' can only be questions as between the parties to the litigation. The phrase 'to enable the <ORG> effectually and completely to adjudicate upon and settle' would seem really to indicate that the addition of the party should be ordered only if in the opinion of the <ORG>, in the absence of the party, it cannot effectually and completely adjudicate and settle all the questions.

4. In the present case the addition of the first respondent as third plaintiff means the investigation of the whole question of his contract to finance the plaintiffs with which the defendant has nothing whatever to do, and it appears to me that it would be just as reasonable to allow the plaintiffs if the champertous maintainer of the suit fails and provide them with funds to carry on the suit, to ask to have him made a defendant in this suit so that they can get relief against him for his failure to do so, as to allow the champertous maintainer to be added as a party so that he may protect his interests as against plaintiffs, which is what he has been allowed to do by this order. In <N<ORG>ME> v. <N<ORG>ME> (1871) 15 Suth. W.R. 6, it was laid down that a person to be added as a party to a suit must have a present interest in such litigation. That was held to exclude even a reversioner who had been made a co-defendant. <N<ORG>ME> v. <N<ORG>ME> (1869) 12 M.I.<ORG>. 275 was quoted with approval in <N<ORG>ME> v. <N<ORG>ME> (1872) 18 W.R. 140, where <ORG> who was entitled to certain property, but had not the means to institute the suit for the recovery of the same, agreed by deed to sell <ORG> a moiety thereof in consideration of a sum of money which <ORG> was to pay for the purpose of carrying on the suit in the names of <ORG> and <ORG> as plaintiffs. Shortly afterwards <ORG> entered into a deed of compromise with <ORG>, who was the claimant and in actual possession of the geater part of the property in question, by which a portion of the property was divided between them. Held, in a suit brought by <ORG> against <ORG> and <ORG>, that the first deed did not operate as a present transfer of the property, but only as an agreement to transfer it upon certain contingencies which had not happened. In the present case there is not even a registered document produced to evidence the agreement though the immoveable properties are described as worth Rs. 2,500 in the suit sale-deed.

5. It has been argued for the first respondent that he has an interest in the suit and that he would be prejudiced if the first plaintiff was allowed to withdraw from the suit. No decision has been quoted in which a person has been allowed to be added as a plaintiff merely because he is financially interested in the suit or will be affected in some way by its success or failure. <CITATION> for India (1925) 50 <ORG>.L.J. 59 and <NA<ORG>E> v. <NA<ORG>E> (1892) 1 Ch. 487. In the latter case the plaintiff, the patentee of a machine, brought an action against the defendant for using a machine which he alleged was an infringement of his patent. <ORG>, the maker and patentee of the defendants' machine, applied to be added as a defendant, alleging that a judgment in the action would injure him, and that the present defendant would not efficiently defend the action. Held that <ORG>, not being directly interested in the issues between the plaintiff and defendant, but only indirectly and commercially affected, the <ORG> had no jurisdiction to add him as a defendant. At page 490, speaking of the English rule corresponding to Order 1, Rule 10, Lindley, L.J. says:

Can it be said that the rule prevents the plaintiff from proceeding against a defendant without having lo litigate with everybody who may be in any way affected, however indirectly, by the action?

6. It appears to me that it does not. At page 491, <NAME>, <NAME> says:

The result on the construction contended for, would be that not only persons directly affected, ahd who would be bound by the judgment in the action, would be within the rule, but any person who might think he would be affected indirectly might insist on being made a party.

7. The mere fact that the first respondent may be affected by the result of this suit whether it is dismissed after real contest or by a collusive withdrawal is no reason for allowing him to be added as a plaintiff and involving the defendant in all sorts of questions between the first respondent and the plaintiffs with which the defendant has nothing whatever to do. I am clear that the order in this case is, not only wrong but was without jurisdiction as held in <NAME> v. <NAME> (1892) 1 Ch. D. 487.

8. The Civil Revision Petition is therefore allowed with costs.


<NAME>, J.

1. This is an appeal filed by the private individual concerned against the claim decree on account of accident and death passed in favour of respondents Nos. 1 to 4, The trial court held that the accident resulting into death of <NAME> was caused due to rash and negligence of the driver of that bus. It determined the liability for damages for a sum of Rs. 12000/-. It further directed that out of the aforesaid sum Rs. 5000/- would be paid by the Insurance Company which has insured the bus in question while the remaining amount, that is, Rs. 7000/- will be paid by the owner of the Bus. Two arguments are urged on behalf of the appellant. The first argument urged is that the Bus was itself hit by the Railway Engine and it was unmanned railway crossing so <ORG> was also a necessary party. When the crossing is unmanned it is the duty of the person driving any vehicle or cart at the crossing railway line at that point to be alert and vigilant. The driver of the Bus should have taken notice of the approaching engine. If that was not done naturally accident will be due to negligent act of the driver and there is no question in such situation of any contributory negligence. <ORG> was thus not a necessary party. Apart from that where there is a joint and several liability it is always open to sue any of the person so liable without making other a party. The arguments to the contrary have no force and are rejected.

2. The next point urged is that the Bus in question had the capacity of more than 30 and so bus was compulsorily insurable for Rs. 75000/- under the provisions of Section 95(2)(b) of the Motor Vehicles Act and when that is the position and claim was allowed for Rs. 12000/- only the Insurance Company should have been taxed with the entire liability and any part of the liability should not have been fastened to the owner of the Bus. Reliance is placed in that connection upon the case of <CITATION> , AIR 1984 All 183. It was held in that case while interpreting Section 95 (2) (b) (4) of the Motor Vehicles Act that whereas only one passenger injured limit of liability of insurer as regards compensation amount for each passenger does not apply. With great respect to the Hon'ble Judge 1 may mention that in the aforesaid case the direct authority of <ORG> reported in 1971 Acc CJ 206: (AIR 1971 SC 1624) was not brought to the notice of his Lordship by the counsel for any parties. This case is of <CITATION> . Co. Ltd. The point that directly arose for consideration in that case was is to limit of liability of <ORG> under Section 95(2) of the Motor Vehicles Act 1939. At that time the limit was Rs. 2000/- in respect of the individual passenger carried in vehicle other than one carried in a Motor cab. That limit has been raised now to Rs. 5000/-. But there is no other change in the rest of that provision. In fact, in that case also the total liability of the insurance company was Rs. 20000/- with a rider concerning individual passenger carried in the vehicle limiting the liability, and it was held that actually that rider which limits liability to certain amount will govern the case irrespective of the total liability of insurance amount. In fact Section 95(2)(b)(ii)(4) of the Motor! Vehicles Act is express on the point. Sub-section (2) lays down that the Insurance covers liability up to the limits laid down below and then Clause (4) of sub-sec. (2)(b) laysdown the limit of liability for each individual passenger to Rs. 5000/- only, this would be the maximum limit irrespective of the total a mount for which , vehicle is insured or required to be insured. The statutory liability is only' to that extent. Any further liability can be taken by insurance Company only in pursuance of any further contract or stipulation which is not the case. Similar view was taken in the case of <ORG> v. <NAME> also 1982 Acc CJ 460 (<NAME>), I am hound by the authority of <ORG> which I must follow with greatest respect.

3. The next point urged is that it is joint liability and <ORG> cannot apportion the liability. The position is just reverse. The primary liability is of the bus driver and the bus owner. <ORG> becomes liable only by the provision of statute and not on account of their having committed any wrongful act, ca using accident so <ORG> would be liable only for the limited amount of Rs. 5000/- under its statutory liability and not beyond that and when that is the position the amount has rightly been apportioned as not to tax bus owner for the total liability but only for the balance amount left by apportionment, passing a decree against <ORG> to the extent of its liability and against the Bus owner for the balance amount assessed as the compensation.

4. In the result I hold that the liability of <ORG> is limited to Rs. 5000/-onlyand the claim has been rightly allowed to the limit of Rs. 5000/- only against the <ORG> and the decree for the balance amount has rightly been passed against the appellant. This appeal has, therefore, no force and is dismissed. I direct the parties to bear their own costs.

5. From the claimant's side a cross objection was also filed seeking enhancement of the amount, I find that <ORG> has made rational approach taking all relevant dates into consideration and the amount of claim award fixed is reasonable and in accordance with the settled principles of law. The judgment determining the amount to be a warded is based on a proper rationale and on settled legal proposition. It is, therefore, not a fit case for making any interference and enhancing the amount of the damages. The cross-objection is also dismissed and parties to bear their own costs.


PETITIONER: 1340 SHRI CHINTAMAN RAO & ANOTHER Vs. RESPONDENT: THE STATE OF MADHYA PRADESH DATE OF JUDGMENT: 18/02/1958 BENCH: <NAME>, K. BENCH: <NAME>, K. SINHA, BHUVNESHWAR P. IMAM, SYED JAFFER CITATION: 1958 AIR 388 1958 SCR 1340 ACT: Worker-Test for determining-<ORG> contracting to supply bidis to bidi factory and coolies of such <ORG>-If workers in the factory- Factories Act (LXIII of 1948), SS. 2(1), 62, 63 and 92. HEADNOTE: The appellant was the manager of a bidi factory which had contracts with certain independent contractors, known as <ORG>, for the supply of bidis. The <ORG> undertook to supply the bidis by manufacturing them in their own factories or by entrusting the work to third parties, a' a price to. be paid by the management after delivery and approval. The Inspector of Factories found working in the appellant's factory certain <ORG> and their coolies who had come to deliver bides manufactured by them. The appellant was prosecuted and convicted under s. 92 , Factories Act for violation of the provisions of ss. 62 and 63 for failure to maintain the register of adult workers and for allowing the workers to work in the factory without making beforehand the entries of their attendance in the register : Held, that the <ORG> and their coolies were not workers within the definition in S. 2(1) of the Act and, therefore, the noninclusion of their names in the register or the absence of entries in regard to them therein did not constitute an offence under s. 92 of the Act. To determine whether a person employed is a worker the test is whether or not the employer had control and supervision over the manner in which the work was to be done. The <ORG> were not under the control of the factory management and could manufacture the bidis wherever they pleased. The coolies were neither employed by the management directly nor were they employed by the management through the <ORG>. <CITATION> ,  S.C.R. 152, applied. JUDGMENT:

CRIMINAL APPELLATE JURISDICTION : Criminal Appeal No. 93 of 1955.

Appeal by special leave from the judgment and order dated September 16 1954, of the former <ORG> in Criminal Revision No. 295 of 1954, arising out of the judgment and order dated March 8, 1954, of the Second Additional Sessions Judge at <NAME> in Criminal Appeal No. 368 of 1953, against the order dated August 5, 1953, of the Judge Magistrate, <NAME>, in Criminal Case No, 146 of 1953.

<NAME>

<NAME> and <NAME>, for the appellants. <NAME>, for the respondent.

1958. February 18. The following Judgment of the Court was delivered by <NAME> appeal by Special Leave is directed against <ORG> at Nagpur and raises the question of construction of some of the provisions of the Factories Act (LXIII of 1948) (hereinafter referred to as the Act). Before posing the questions raised it would be convenient and useful at the outset to state the facts either found by <ORG> or admitted by the parties.

Messrs. <NAME> and Company is a bidi factory situated in Sagar. The 1st Appellant, <NAME>, is the Managing-Partner of the firm while the 2nd appellant, <NAME>, is its active Manager. The Company manufactures bidis. The process of manufacture, so far as is relevant to the question raised, is carried out in two stages. The first stage: The management enters into a contract with independent contractors, known as <ORG>, for the supply of bidis locally. The documents embodying the terms of the contract entered into by the <ORG> were not produced in the case. But the terms of the contract are not in dispute. The Management supplies tobacco to the <ORG> and in some cases bidi leaves. Some of the <ORG> maintain a small factory where they get bidis manufactured by engaging coolies. Others give tobacco and bidi leaves to outsiders who prepare bidis in their houses. After bidis are rolled in the <ORG> collect the bidis so manufactured and take them to the factory directly or through coolies where they are sorted and checked by the workers in, the factory. The selected or approved bidis are separately packed in bundles of 10 and 25 and taken by the <ORG> or the coolies in gauze trays to tandul and left there. The rejected bidis, commonly known as I chhant' are again rebundled by the <ORG> and delivered to the factory.

<NAME>

The management pays the <NAME> the cost of the manufacture of bidis after deducting therefrom the cost of tobacco supplied to them. Thereafter the second stage of the process of the manufacture begins in the factory. It is carried out exclusively by the labourers employed in the factory. It consists of warming of bidis to give taste, wrapping them in tissue papers, labelling and finally bundling them in the 'Pudas'. The finished product is then marketed. From the aforesaid description of the dual process of manufacture of bidis it is manifest that a <NAME> is only an independent contractor, who undertakes to do a specific job of work, i. e., the supply of bidis, directly or indirectly through his coolies, by manufacturing them either in his own factory or by entrusting the work to third parties, at a price to be paid by the management after delivery and approval. He (<NAME>) or his coolies neither work in the appellants' factory nor are they subject to the supervision or control of the appellants. The coolies or the third parties, to whom the work of making of bidis is entrusted by the <NAME>, are employed by the <NAME> and are paid by them. None of them works in the factory though they bring bidis to the factory for delivery in accordance with the terms of the contract. It may also be pointed out that the factory employs workers who are under the direct control and supervision of the factory management and who attend to the second part of the process of manufacture described above. On December 9, 1952, <NAME>, the Inspector of Factories, Madhya Pradesh, Nagpur, visited the factory at 5-30 p. m. At the time of his inspection he found the following persons in the factory

1. Pirbaksha, son of Amir.

2. <NAME>, son of Sk. <NAME>.

3. Deviprasad, son of Uddam.

4. Ramshankar, son of Mulchand.

5. Gopal, son of Mulchand.

6. Nirpat, son of Bhagirath.

7. Rameband, son of Gyan.

8. Gotiram, son of Lila.

9. <NAME>, son of <NAME>, Of the aforesaid persons, <NAME>, <NAME> and <NAME> are Sattedars and the rest are coolies employed by the Sattedars. The Inspector found the first seven persons sorting out bidis and packing them into bundles of 10 and 25 in the premises and the last two bringing the bidis to the room in jali for warming. The said facts are practically admitted by some of the aforesaid persons, who gave evidence in the case, and they explained that they came to the factory on that day for delivering the bidis manufactured by them to the factory.

Thereafter the Chief Inspector of Factories filed a complaint in the Court of the Judge-Magistrate, <NAME>, against the appellants for violation of the provisions of ss. 62 and 63 of the Act, under the former for failure to maintain the register of adult workers with all the prescribed entries duly filled in and under the latter for allowing the workers to work in the factory without making beforehand the entries of their attendance in the register of adult workers. The Judge-Magistrate, <NAME>, held that the appellants contravened the provisions of the aforesaid sections and on that finding convicted them under s. 92 of the Act and directed them to pay a fine of Rs. 50 and Rs. 25 respectively. On appeal the Second Additional Sessions Judge, <NAME>, confirmed the conviction of the 2nd appellant for contravening the provisions of ss. 62 and 63 but set aside that of the 1st appellant in regard to s. 62 but confirmed the conviction for contravening s. 63 of the Act. The Revision Petition filed by the appellants in <ORG> at Nagpur was dismissed. As aforesaid with Special Leave of this Court, this appeal was filed against the Order of <ORG>.

The conflicting contentions of the parties may briefly be stated. The learned counsel for the appellants contends that a <NAME> is an independent contractor, who undertakes to do a specific job of work for other persons without submitting himself to their control, and that he or his employee is not a worker within the definition of s. 2 (1) of the 'Act and therefore the appellants are not under duty to comply with the conditions of ss. 62 or 63 in respect of them. Whereas the learned Counsel for the <ORG> argues that the definition of the word 'worker' is comprehensive enough to take in all persons who work in the factory, whether employed by the factory or not.

The answer to the question raised turns upon the construction of the relevant provisions of the Act. They read:

Section 62 . Register of adult workers The manager of every factory shall maintain a register of adult workers, to be available to the Inspector at all times during working hours, or when any work is being carried on in the factory, showing-

(a) the name of each adult worker in the factory;

(b) the nature of his work;

(e) the group, if any, in which he is included

(d) where his group works on shifts, the relay to which he is allotted;

(e) such other particulars as may be prescribed: Provided that, if the Inspector is of opinion that any muster roll or register maintained as part of the routine of a factory gives in respect of any or all the workers in the factory the particulars required under this section, he may, by order in writing, direct that such muster roll or register shall to the corresponding extent be maintained in place of, and be treated as, the register of adult workers in that factory.

Section 63 . Hours of work to correspond with notice under Section 61 and register under Section 62 .- No adult worker shall be required or allowed to work in any factory otherwise than in accordance with the notice of periods of work for adults displayed, in the factory and the entries made before-hand against his name in the register of adult workers of the factory.

Section 92 . General penalty for offences. Save as is otherwise expressly provided in this Act and subject to the provisions of section 93 , if in, or in respect of, any factory there is any contravention of any of the provisions of this Act or of any rule made thereunder or of any order in writing given thereunder, the occupier and manager of the factory shall each be guilty of an offence and punishable with imprisonment for a term which may extend to three months or with fine which may extend to five hundred rupees or with both, and if the contravention is continued after conviction, with a further fine which may extend to seventy- five rupees for each day on which the contravention is so continued.

Section 2(1) worker' means a person employed, directly or through any agency, whether for wages or not, in any manufacturing process, or in cleaning any part of the machinery or premises used for manufacturing process, or in any other kind of work incidental to, or connected with, the manufacturing process, or the subject of the manufacturing process.

Section 2(m) "factory" means any premises including the precincts thereof-

(i) Whereon ten or more workers are working, or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power, or is ordinarily so carried on, or

(ii) Whereon twenty or more workers are working, or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on without the aid of power, or is ordinarily so carried on.............. .................. .

Section 2(n) "occupier " of a factory means the person who has ultimate control over the affairs of the factory.................................................... The gist of the aforesaid provisions relevant to the question raised may be stated thus: The Manager of a factory-factory is defined under the Act as the premises wherein a specified number of workers are working and in any part of which a manufacturing process is carried on, with or without the aid of power-shall maintain a register of adult workers working in that factory, showing the necessary particulars mentioned in s. 62 of the Act. No adult worker shall be required or allowed to work in any such factory otherwise than in accordance with the notice of periods of work for adults displayed in the factory and the entries made beforehand against his name in the register of adult workers of the factory. If there is any contravention of the said provisions, the occupier, who is defined as a person who has ultimate control over the affairs of the factory, and the manager are guilty of offences punishable under the Act.

Admittedly the names of the 9 persons, stated supra, were not entered in the register of adult workers maintained by the factory. Neither any notice of the periods of work allotted to them was displayed in the factory nor any entries made beforehand against their names in the register of adult workers of the factory. The appellants, therefore, would have certainly contravened the provisions of the Act, if, in fact, the said persons were workers in the factory as defined Under the Act .

This takes us to the consideration of the definition of the term ' worker' under the Act. 'Worker' is defined to mean a person employed, directly or through any agency, whether for wages or not, in any manufacturing process. It is and it cannot be disputed that the making of bidis is a manufacturing process. But is a <NAME> a person 'employed ', directly or through agency, within the meaning of the definition " employed". The concept of employment involves 'three ingredients: (1) employer (2) employee and (3) the contract of employment. The employer is one who employs, i.e., one who engages the services of other persons. The employee is one who works for another for hire. The employment is the contract of service between the employer and the employee hereunder the employee agrees to serve the employer subject to his control and supervision. Can it be said that a <NAME> is employed by the management of the factory to serve under it ? There is a well understood distinction between a contractor and a workman and between contract for service and contract of service. In Stroud's Judicial Dictionary (Third Edition, Volume 1, Page 616) the distinction between a contractor and a workman is brought out in bold relief in the following manner:

" Of course, every person who makes an agreement with another for the doing of work is a contractor, in a general sense; but as used in Workmen's Compensation Act , 1897 (60 & 61 Vict., c. 37), s. 4 "contractor" and "WORKMAN" "have come to have a more restricted and distinctive meaning," and "contractor " means 'one who makes an agreement to carry out certain work specified, but not on a contract of service'." The same idea is repeated in a different terminology thus.. " A 'contractor' is a person who, in the pursuit of an independent business, undertakes to do specific jobs of work for other persons, without submitting himself to their control in respect to the details of the work ". There is, therefore, a clear-cut distinction between a contractor and a workman. The identifying mark of the latter is that he should be under the control and supervision of the employer in respect of the details of the work. This Court in <CITATION> (1) in the context of the definition of " workman " under the Industrial Disputes Act (XIV of 1947) made the following observations at page 157: " The essential condition of a person being a workman within the terms of this definition is that he should be employed to do the work in that industry, that there should be, in other words, an employment of his by the employer and that there should be the relationship between the employer and him as between employer and employee or master and servant. Unless a person is thus employed there can be no question of his being a workman within the definition of the term as contained in the Act."

Elaborating the point further, <NAME> (I) [1957] S.C.R. 152.

delivered the judgment on behalf of the <ORG> proceeded to state:

"The test which is uniformly applied in order to determine the relationship is the existence of a right of control in respect of the manner in which the work is to be done." After considering the Case-law on the subject the learned Judge restated the principle at page 160 thus: " The principle which emerges from these authorities is that the prima facie test for the determination of the relationship between master and servant is the existence of the right in the master to supervise and control the work done by the servant not only in the matter of directing what work the servant is to do but also the manner in which he shall do his work, or to borrow the words of Lord <NAME> at page 23 in <ORG> v. <ORG>, and another ([1947] 1 A. C. 1,

23), "The proper test is whether or not the hirer had authority to control the manner of execution of the act in question."

After noticing the subsequent trend of decisions wherein it is observed that the test of control is not one of universal application, the learned Judge expresses his view thus: " The correct method of approach, therefore, would be to consider whether having regard to the nature of the work there was due control and supervision by the employer............................. " There is no reason why the test laid down by this Court in the context of the definition of 'workman' under the Industrial Disputes Act of 1947, cannot be invoked or applied for ascertaining whether a person is a 'worker' under the Act. If the test be applied, it is not possible to hold that <ORG> in the present case, having regard to the nature of the work under. taken by them and the terms whereunder their services were engaged, are " workers " within the meaning of the definition under the Act. It has been established in the present case that the <ORG> is only an independent contractor and the agreement between the management and the <ORG> is only that the <ORG> should receive tobacco from the management and supply them rolled in bidis for consideration. He is not under the control of the factory management and he can manufacture bidis wherever he pleases. It is immaterial to the management whether he makes the bidis in his own factory or distributes tobacco to different individuals for making bidis under a separate agreement entered into by him with them. The management cannot regulate the manner of discharge of his work. His liability is discharged by his supplying bidis and delivering them in the <ORG>. The terms of the contract between the management and the <ORG>, as disclosed in the evidence, do not enjoin on the latter to work in the factory. His only obligation is to deliver bidis at the factory. That would be an obligation imposed on any contractor who undertakes to supply and deliver the goods to the other party. We, therefore, hold that the <ORG> in this case were not employed by the management as workers but were only independent contractors who performed their part of the contract by making bidis and delivering them at the factory.

If the <NAME>, i. e., three out of the nine persons found at the factory, were not workers within the meaning of the Act, can it be said that the other persons, who were coolies employed by the <NAME> to enable them to keep up their contract with the management of the factory, were workers as defined under the Act? A "worker" under the definition means a person employed, directly or through any agency. The words I directly or through any agency indicate that the employment is by the management directly or through some kind of employment agency and in either case there is a contract of employment between the management and the per. sons employed. Admittedly the coolies were not employed by the management; there was DO privity of contract between them and the management. It is not disputed that the coolies were not employed by the <NAME> for or on behalf of the management of the factory. They were employed by the <NAME> on their own account and they paid them for the work extracted from them. On the aforesaid facts it is obvious that the coolies were not employed by the management directly nor were they employed by the management through the agency of <NAME>. If so, it follows that coolies employed by the <NAME> are not workers within the meaning of the definition in the Act.

The evidence discloses a third category of persons who took some part in the manufacturing process of bidis. They were the persons to whom the <NAME> distributed tobacco for making bidis in their respective homes. It does not appear from the evidence that any one of the nine persons found in the factory belongs to that category. That apart those persons cannot, in any sense of the term, be called the persons employed by the management directly or through any agency.

That that should be the construction of the provisions of s. 2 (1) of the Act is reinforced by other relevant provisions of the Act. Chapter 6 is headed " Working hours of Adults". Section 51 prescribes the weekly hours of work for a worker. Section 52 provides that no adult worker shall be required or allowed to work in a factory on the first day of the week and if he is made to work on that day for the substitution of another holiday in its place. Section 53 gives compensatory holiday to a worker who is made to work on a regular holiday. Section 54 fixes the daily hours of work and s. 55 intervals for rest. Section 56 limits the spread over of period of work for an adult worker to 10 1/2 hours in a day, including the intervals for rest. Sections 57 , 58 , and 59 deal with night shifts prohibition of overlaping shifts and extra wages for overtime. Section 60 prohibits double employment, i. e., employment of the same worker in a factory on any day on which he has already been working in any other factory. Section 61 enjoins on the management of the factory to display and maintain the notice of periods of work for adults, showing clearly for every day the periods during which the adult workers may be required to work and directs that the said notice shall be such that the workers working for those periods would not be working in contravention of any of the provisions of ss. 51 , 52 , 54 , 55 , 56 and 58 of the Act. Section 62 , for breach of which provisions the prosecution was launched in the present case, imposes a duty on the manager of every factory to maintain a register of adult workers, showing the name of each adult worker in the factory, the nature of his work, the group, if any, in which he is included, where his group works on shifts, the relay to which he is allotted and such other particulars as may be prescribed. Section 63 directs that the hours of work of an adult worker should correspond with the particulars given in the notice under s. 61 and the register under s. 62 . Section 92 constitutes the contravention of any of the provisions of the Act or any rules made thereunder an offence punishable with imprisonment or fine or with both. The scheme of the aforesaid provisions indicates that the workmen in +,he factory are under the direct supervision and control of the management. The conditions of service are statutorily regulated and the management is to conform to the rules laid down at the risk of being penalised for dereliction of any of the statutory duties. The management obviously cannot fix the working hours, weekly holidays, arrange for night shifts and comply with other statutory requirements, if the persons like the <NAME>, working in their factories and getting their work done by others or through coolies, are workers within the meaning of the Act. It is Well nigh impossible for the management of the factory to regulate their work or to comply with the mandatory

-provisions of the Act. The said provisions, therefore, give a clear indication that a worker under the definition of the Act is a person who enters into a contract of service under the management and does not include an independent contractor or his coolies or servants who are not under the control and supervision of the employer.

There is a conflict of decisions between the Allahabad and the Nagpur <ORG> on the construction of s. 2 (1) of the Act. A Divisional Bench of <ORG> in <ORG> v.<NAME> (1) considered the scope of the definition of the word " worker " in the Factories Act . There the facts were: On November 10, 1943, a new battery of boilers was being erected on the premises of <ORG> in order to supply energy to <ORG> at Khamaria. The work of erection was entrusted to Messrs. <NAME> and <NAME> of Calcutta. The persons who were employed by Messrs. <NAME> and <NAME> were found working in the premises of <ORG> in contravention of the provisions of the Factories Act . The question was whether the employees of an independent contractor were workers as defined under s. 2 (1) of the Act. <NAME> who delivered the judgment of <ORG> stated at page 44 thus:

" The definition of " worker " is a very wide one, and it is wide enough, in our opinion, to include per. sons employed in repairing machinery or putting up new machinery, even if such a machinery is not in actual use at the time. " It may be noticed that no contention was raised in that case that the persons found in the factory were not the employees of <ORG> The only question raised and decided was whether the persons employed in repairing the machinery or putting up new machinery were persons engaged in any manufacturing process or any work incidental to or connected with it. The question now raised was not before the learned Judge and therefore there was no occasion for them to express any opinion thereon. The fact that if this question was raised and decided in the way we did, the conclusion of the learned Judges would have been different cannot make the said decision an authority on a point not raised or decided upon by the learned Judges. Another Bench of <ORG> in <ORG> v. <NAME> (2) gave a wide connotation to the word" employed" under s. 66(1)(b) of the Factories (1) I.L.R.  Nagpur 43.

(2) I.L.R. [1953] Nagpur 67.

<NAME>

Act. The learned Judges observed that the word " employed ", in their opinion, did not only connote employed on wages but also being occupied or engaged in some form of activity. If the learned Judges meant by that observation that if a person is found, engaged in some form of activity in a factory, irrespective of whether there was any contract of employment or not between him and the employer, he is a worker, we should express our respectful dissent from the said observation. But, on the other hand, if they had only emphasized on the fact, which is obvious from the provisions of s. 2(1) , that the employment need not be for wages, the statement is unobjectionable.

The decision in <CITATION> need not be considered in detail as the learned Judges therein accepted the same interpretation that we have placed on the provisions of s. 2(1) of the Act and came to the conclusion, on the facts of that case, that the persons therein were workers of the factory.

We, therefore, hold that neither the <NAME> nor the coolies found by the Inspector to be working in the factory were workers, as they were not employed by the factory. As they were not workers, the non-inclusion of their names in the register of adult workers or the absence of any entries in regard to them in the said register would not constitute an offence under s. 92 of the Act. Before leaving this case we would like to make one observation. Our decision is not intended to lay down a general proposition that under no circumstances a <NAME> can be considered to be a worker within the meaning of its definition in the Act. Whether a particular person, under whatever designation he may be known, is a worker or not under the Act depends upon the terms of the contract entered into between him and the employer. In the case before us no attempt has been made by the prosecution to establish that the <NAME> were employed by the (1) A.I.R.  Allahabad 44.

<NAME>

management for doing work in the factory. The un- contradicted evidence is that they were independent contractors who came to the factory to deliver the bidis or sent their coolies to do the same. Our decision is, therefore, confined to the facts of this case. In the result we allow the appeal and set aside the convictions of the appellants under B. 92 of the Act and the sentences imposed upon them. The fines if paid, will be refunded.

Appeal allowed.

<NAME>


JUDGMENT <NAME>, C.J.

(1) This is a petition by a dismissed employee of the Surat Municipal Borough complaining that the decision given by <ORG> and <ORG> was without jurisdiction and asking us to set right that decision by a prerogative writ. The facts briefly are that the petitioner joined the Surat Municipal Borough on. November 4, 1949. There was a dispute between the Municipality and its workmen which was referred to <ORG> on May 15, 1950. While that dispute was pending before the <ORG>, the Surat Municipal Borough dismissed the petitioner. An application was made by the petitioner under Section 33A to the <ORG> complaining against his dismissal by the Surat Municipal Borough. The <ORG>' came to the conclusion that the Surat Municipal Borough was justified in terminating the services of the petitioner. There was an appeal to <ORG> and <ORG> upheld the decision of <ORG>.

(2) A very able argument has been advanced before us by Mr. <NAME> as to the scope and extent of the inquiry contemplated by Section 33A before <ORG>. Section 33 of the Act prohibits an employer from altering to the prejudice of the workmen concerned in any pending dispute the conditions of service applicable to them immediately before the commencement of such proceeding, and also prohibits him from discharging or punishing, whether by dismissal or otherwise any workman concerned in such dispute; and it is common ground that the petitioner was concerned in the pending dispute before the <ORG>. Now, this prohibition is not absolute. It would be open to the employer to alter the conditions of the workmen to their prejudice or even discharge or punish them if he obtained the express permission in writing of the conciliation officer, <ORG> or <ORG>. If he did not obtain such a sanction and he acted to the prejudice of the workmen, a penalty is provided under Section 31 and the penalty is that any employer who contravenes the provisions of Section 33 shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both. Therefore, reading Ss. 33 and 31, no difficulty presents itself. The <ORG> has chosen to protect the rights of workmen pending industrial disputes by prohibiting the employer from doing anything to their prejudice without the express sanction of the conciliation officer. <ORG> or <ORG> before whom there is a pending reference. In this particular case it is again common ground that the petitioner was discharged by the Surat Municipal Borough without the permission of that <ORG> and in having done so the Municipal Borough undoubtedly contravened the provisions of Section 33. It would also appear that by doing so it render-ed itself liable to be prosecuted and punished under Section 31.

Then we come to Section 33A, the interpretation of which may suggest certain difficulties. The headnote of that section is, "Special provision for adjudication as to whether conditions of service, etc., changed during pendency of proceedings", and the section provides that "Where an employer contravenes the provisions of Section 33 during the pendency of proceedings before a <ORG>, any employee aggrieved by such contravention, may make a complaint in writing, in the prescribed manner to such <ORG> and on receipt of such complaint that <ORG> shall adjudicate upon the complaint as if it were a dispute referred to or pending before it, in accordance with the provisions of this Act and shall submit its award to the appropriate Government and the provisions of this Act shall apply accordingly."

It was under this section that the petitioner made a complaint to the <ORG> and it was acting under this section that the <ORG> made "its award. The contention o£ Mr. <NAME> is that the scope and ambit o£ an inquiry under this section is limited and confined to a mere inquiry as to whether there has been a contravention of Section 33. Mr. <NAME> says that i£ the <ORG> comes to the conclusion that the employer contravened the provisions of Section 33, then the only award that the <ORG> can make is to restore the status quo either by ordering the reinstatement of the workman if he has been discharged, or by restoring the previous conditions of service if those conditions have been altered to his prejudice. But Mr. <NAME> says that it is not competent to the <ORG> to go into the merits of the change made by the employer to the prejudice of the workman. Therefore, according to Mr. <NAME> the <ORG> acted without jurisdiction when it adjudicated upon the question as to whether the employer was justified in discharging the petitioner.

(3) Now, it is necessary to consider what the law was before Section 33A was incorporated into the Industrial Disputes Act . That section was incorporated by Act 48 of 1950 and before that incorporation Section 33 was the only section dealing with a change made by the employer pending a reference, tinder the old ]aw, if an employer changed the conditions of service of a workman to his prejudice or discharged him, the workman had no remedy available to him. A reference undoubtedly could bo made to the <ORG>, but that reference could only be made by <ORG>. The workman might move the <ORG> to make the reference, but it was left to the discretion of the <ORG> whether to make the reference or not. Therefore, under the old law, although the employer was liable to be punished for a contravention of Section 33 the workman had no remedy in himself to move the <ORG> to adjudicate upon what the employer had done to his prejudice. Therefore, Section 33A confers an important right upon the workman. He has a right to make a complaint to the <ORG> and the <ORG> has been given the right to adjudicate upon the complaint as if it were a dispute referred to or pending before it and the <ORG> has been also conferred the jurisdiction to submit an award in respect o£ this dispute to the appropriate <ORG>. Therefore, prima facie, it seems clear that the object of Section 33A was to avoid a multiplicity of proceedings. Instead of <ORG> making an independent reference and calling upon the <ORG> to adjudicate upon that reference, a more summary procedure was provided by which the workman himself, if he objected to the change or objected to his discharge, could go to the <ORG> and ask the <ORG> to adjudicate upon the dispute between himself and his employer. It seems to us difficult, on the language used by Section 33A , to hold that the ambit and scope of the inquiry to be held by the <ORG> is as limited as Mr. <NAME> would suggest. If the intention of the <ORG> was that all that the <ORG> could do under Section 33A was merely to determine the simple question as to whether a change to the prejudice of the workman had been brought about by the employer without the express permission in writing o£ the <ORG>, and if that decision was against the employer, the only power that the <ORG> had was to restore the status quo, it seems to us that the language used by the <ORG> in Section 33A would have been very different from the language it has actually used. The very fact that the <ORG> treats the complaint as if it were a dispute referred to or pending before it, goes to show that the jurisdiction of the <ORG> was not limited merely to consider the question of the contravention of Section 33 , but to decide on the substantive dispute between the employer and the workman with regard to the change in the conditions of service or the discharge of the employee by the employer.

(4) Reliance has also been placed by Mr. <NAME> on the headnote to Section 33A . The head-note is not as unequivocal as Mr. <NAME> would have us believe. But even if it were so worded as to support the contention of the petitioner, it obviously cannot control or limit the scope and ambit of the inquiry dealt with in the section itself. At best the headnote is intended to indicate the drift of the section.

(5) It has been argued with considerable force by Mr. <NAME> that if the petitioner has been discharged in contravention of Section 33 , the discharge is illegal and an illegal discharge can never be justified and upheld by the <ORG>. Mr. <NAME> further contends that it is not open to an employer to urge the propriety of his action in discharging his workman if his act is prohibited by law. Put in that form the argument seems difficult to meet. But when one closely analyses that argument, it is clear that it is not tenable. The functions of the <ORG> acting under Section 33A in adjudicating upon the dispute and the functions of a criminal <ORG> considering the violation of Section 33 are different and the two tribunals approach the matter from entirely different aspects. A criminal tribunal trying the employer who is prosecuted for violating Section 33 would confine itself to the sole question as to whether there was a breach of the law. If there was a breach of the law, the tribunal would have to proceed to inflict the punishment provided by Section 31 . The Industrial <ORG>'s functions are different and much wider. Apart from the breach of the law under Section 33 for which a penalty is provided, the <ORG> would be concerned with the question as to whether on merits the employer was justified in discharging the petitioner or changing the conditions of service to his prejudice. Take this very case.

It is perfectly true that the Surat Municipal Borough discharged the petitioner in contravention of Section 33 . The Municipal Borough would have no answer i£ a prosecution had been launched against them by Government. But when the matter comes before the <ORG> and a complaint is made by the workman under Section 33A , the answer given by the Municipal Borough is that although in not taking the sanction of the <ORG> it undoubtedly committed a breach of the law, it was justified in discharging the petitioner because on the particular facts of the case it had the right to discharge him. Now is it suggested that wnen that answer is given by the employer, the <ORG> must contine its attention merely to the question of the breach of the law and ignore the answer given by the employer on the merits of the case? In our opinion, the object of enacting Section 33A is not merely to confine the jurisdiction of the <ORG> to the simple question of the breach of the law, but to confer upon the <ORG> the wider jurisdiction of deciding the merits of the dispute between the employer and the workman.

(6) Now, it is suggested by Mr. <NAME> that this interpretation of ours would permit the employer to evade the law and would be highly prejudicial to the workman. We are conscious of the fact that we are interpreting a statute which was intended to confer benefits upon the working classes and the underlying principle of all such legislation is that the workman should be protected against the employers and therefore we must always hesitate to put any interpretation upon labour legislation which is likely to prejudice the rights of workmen. But we feel certain that in placing the interpretation that we are doing, we are in no way prejudicing the rights of the workmen. Let us consider why Mr. <NAME> thinks that the rights of the workmen will be prejudiced. What Mr. <NAME> says is that an employer, hoping that his action would be ultimately upheld by the <ORG>, would take the law into his own hand, dismiss an employee or alter conditions of his service to his prejudice, without taking the sanction of the <ORG>. The answer to this is two-fold. In the first place, the employer would run the risk of being prosecuted. In the second case, it is difficult to understand why an employer, who could get the sanction of the <ORG> if his action could ultimately be justified at the hearing, would not do so and would, without any reason whatsoever, indulge in violating the law as laid down in Section 33 . There is one possible prejudice of which we are conscious and the possible prejudice is that if the employer were to ask for sanction of the <ORG> before taking action, the <ORG> would have to hear the matter, and it is only after the <ORG> has given its decision that the employer could act as he intended to act. In this very case, if the Surat Municipal Borough had applied to the <ORG> for sanction for dismissing or discharging the petitioner, the Municipal Borough could not have discharged him till after the permission had been granted. In other words, the discharge of tile petitioner would have been postponed for some time and during that period he would have earned his salary. But even this prejudice can be obviated by the <ORG> in proper cases awarding compensation to the workman when he has been discharged without the sanction of the <ORG>. The <ORG> may well say that although your action is justified, inasmuch as you did not take the sanction of the <ORG>, inasmuch as you committed a breach of the law, we will penalise you and compel you to give compensation to the workman for such period as the <ORG> thinks proper. It may be said in fairness to the Industrial <ORG> in this case that it did consider the question of compensation & on the facts of this particular case it came to the conclusion that no compensation should be awarded to the petitioner.

(7) It is than argued by Mr. <NAME> that this interpretation of Section 33A would make the law discriminatory in favour of the employer and would give him an additional right which he did not enjoy before, and the additional right suggested is that by violating Section 33 he could get a reference under Section 33A which he would otherwise not have had. This seems to us to be a totally wrong approach to the purpose for which Section 33A was enacted. It is left to the workman whether to have a reference with regard to the industrial dispute under Section 33A or not. It is only if the workman feels that what the employer has done is without justification that he would proceed to make A complaint before the <ORG>, and therefore if a reference is brought about and there is an adjudication and award, it is at the instance of the workman and not strictly at the instance of the employer. Before Section 33A was enacted, as we have already pointed out, the employer could have, risking a prosecution, acted to the-prejudice of the workman and it was left to the discretion of <ORG> whether to come to the relief of the workman or not. Today the position is entirely different. The workman can protest against the action of the employer and protest effectively by going before the <ORG> and getting the adjudication oC the <ORG> upon the matters in dispute. Apart from that it is always open to the employer to get an adjudication on the question of the change that he proposes to make under Section 33 by applying to the <ORG> for permission. It is difficult to understand why he should prefer a way by which he risks a prosecution and the possibility of having to pay-compensation to the employee whom he has discharged or whose conditions of service he has altered to his prejudice. It is also difficult to understand why the <ORG> cannot exercise the same jurisdiction when a complaint is made by the workman, when the <ORG> admittedly could go into the same question if the employer had asked for the necessary pel-mission: under Section 33 . Therefore, in our opinion, both the Industrial <ORG> and the Labour Appellate <ORG> were right when they took the view that they had jurisdiction to go into the merits of the dispute between the employer & his workmen.

(8) Mr. <NAME> has then attempted to argue that on merits both the <ORG> below were in error in holding that the employer was justified in discharging the workman. It is clear that on this petition we are only concerned with the jurisdiction of the <ORG>. If the <ORG> had jurisdiction, then any decision it arrived at with jurisdiction could not be challenged by a writ. What is suggested by Mr. <NAME> is that there is an error of law apparent on the face of the record. It seems that the Surat Municipal Borough acted under Rule 17(4) which had been framed under Section 58 of the Municipal Boroughs Act in discharging the petitioner. The petitioner wanted to stand and in fact stood for the election to the Rander <ORG> and according to Rule 17(4) framed by the Surat Municipal Borough it was not competent to an Officer of the Surat Municipal Borough to stand for election to any other <ORG>, and the contention of the petitioner was that Rule 17 (4) was 'ultra vires' of the <ORG>, and, therefore, in dismiss ing the petitioner the <ORG> acted under an incompetent rule. Both the Industrial <ORG> and the Labour Appellate <ORG> took the view that Rule 17 (4) was 'ultra vires'. Mr. <NAME> says that Rule 17 (4) goes beyond the scope of Section 58 of the Act. It is difficult to understand how this is an error of law apparent on the face of the record. Even assuming that there is force in the argument advanced by Mr. <NAME>, the mere fact that two views are possible on a question of law does not make the decision of a <ORG> with jurisdiction bad on the ground that it has erred in law and the error is apparent on the face of the record. We have had occasion several times to point out that only that error will be corrected by this <ORG> which is clearly apparent on the face of the record and which does not become apparent only by a process of examination or argument. With some hesitation Mr. <NAME> has also attempted to argue that the decision of the <ORG> with regard to the competency of Rule 17 (4) is a decision as to jurisdiction. It is obviously not. because Rule 17 (4) has nothing to do with the jurisdiction of the <ORG>, hut it has something to do with the jurisdiction of the <ORG>, and the <ORG> was perfectly competent to decide whether the <ORG> was right in dismissing its servant under Rule 17 (4).

(9) The result is that the petitioner fails. Rule discharged. No order as to costs. Rule discharged. (10) Rule discharged.


JUDGMENT

1. The only question argued before us is that of limitation. The decision on that question depends upon the construction to be placed on the term of the bond as to the time when the money became due and payable. The bond runs as follows:

As I have received Rs. 300 (three hundred) in respect of both items in accordance with the said particulars, I shall pay you every month Rs, 3, being the interest on the said amount at 1 per cent, per mensem and (shall pay) the principal Rs. 300 in two years' time and receive back this and the three deeds and the former debt bond. If, in the meantime the hypothecated chits fall to my lot, I shall receive the sums due thereon, and pay them endorsing payments herein below. If there he default in making payments as aforesaid, in subscribing to the said chits, or in paying the interest every month, I shall pay in full the principal with interest at 1 1/2 per cent, on demand by the holder out of my said hypothecated properties. I shall pay the. commission due for taking the first collections.

2. The bond was executed on the 9th February 1882.. If, therefore the interest had been regularly paid, the principal would not have become due until the 9th February 1884, and the suit having been instituted within twelve years from that date, viz., in June 1894, would not have been barred by limitation. It is, however, admitted that no payment at all was made until October 1885, and the lower appellate Court has found that the payment than made was not made on account of interest, but on the general account and that this payment did not, therefore, give rise to a new tempus a quo so as to save the bar by limitation.

3. The lower appellate Court held that the money became due on the first default in payment of interest, viz., in March 1882, and that, as the suit was not brought within twelve years from that date, it was barred.

4. It is admitted that there is nothing to show that any demand for payment was made by the plaintiff before the 9th February 1884, and it is argued by the appellant before us that, in the absence of such demand, the money did not become due until the 9th February 1884, and that the suit was, therefore, improperly dismissed as time-barred.

5. We do not think that this contention can be sustained. It is conceded that, if the bond ran simply I shall pay the principal with interest on demand, no demand would have been necessary to make the money due, and that the time would have run from the date of the bond. (<NAME> v. Hanuman M.H.C.R. 472 Rameshwnr Mandaly Bam Chand Roy I.L.R. 10 C. 1034.

6. The fact that there is a previous covenant, to pay the money within a certain date does not, we think, alter.the meaning or effect of the words in the.later clause making, the money payable on demand. The words "on demand" must, we think, be regarded as a technical expression equivalent to "immediately" or "forthwith." That, we thinks was the intention of the parties. The defendants having failed to pay interest according to the stipulation in the first part of the bond, the money became payable forthwith, and no actual demand was necessary to complete the plaintiff's cause of action.

7. The appellant's vakil has referred to <NAME> v. Arthur Bowles I.L.R. 8 B. 56l Ball v. Stowelfe I.L.R. 2 A. 322 but neither of them is on all fours with the present case. In the former, the words were "if so required,"and <ORG> held that there was a deliberate omission by the plaintiff to realize the condition on which the amount should become payable. In other words, it held that the intention of the parties was that the money should not be payable unless and until the plaintiff required the defendant to pay it. In the second case, it was found that the money was to become due only on default in payment of both premia and interest, and there was no proof that there was default in payment of the <ORG>.

8. In the present case, we are of opinion that the plaintiff's right to sue accrued on first defendant's failure to pay the stipulated interest, that is, in March 1882. The lower appellate <ORG>, has found, as a fact, that the payment made by first defendant in October 1885 was not made on account of interest. That is a finding of fact which we cannot question in second appeal. <ORG>, therefore, ran against plaintiff from March 1882, and his suit not having been brought within 12. years from that date was barred by, limitation and was rightly dismissed.

9. We, therefore, confirm the decree of the lower appellate Court and dismiss this second appeal with costs.


<NAME>, J.

1. It appears to me that we ought to uphold the order made and dismiss this appeal. The application to the <ORG> to obtain a copy of a diary order, certifying that a copy of <ORG> of the properties against which the decree-holder desired to execute his decree was necessary to enable him to do so was, I think, an application to the <ORG> to take some step in aid of the execution of the decree. He required the copy of the register, because without it he could not execute the decree. He required that the <ORG> should certify that such a copy was necessary, because, without such certificate from a <ORG>, <ORG> officers, as a matter of fact, refuse, though they ought not to refuse, to give copies of documents.

2. The only question seems to be whether such an application can be said to be made in accordance with law to the proper <ORG>. It is possible that, by incessant applications to the <ORG> authorities, the decree-holder might have obtained a copy of the register without applying to the <ORG> for a certificate. But, in acting as he did, he took the course most likely to enable him to accomplish his purpose of taking out execution with promptitude. As the production of the copy of the register was a necessary preliminary to execution and the application he made to the Subordinate <ORG> would enable him to obtain it, I think that <ORG> was a proper <ORG> in the sense of Article 179 , Schedule II of the Limitation Act, and that the present application is consequently not barred. The right to execute a decree has been much curtailed by the provisions of Section 230 of the Civil Procedure Code, and the provisions of the Limitation Act should be construed as far as possible so as to prevent the defeat of bond fide endeavours to secure the fruits of a decree once obtained. In <NAME> v. <NAME> 7 W.R. 521 it was held under Act XIV of 1859 that even an opposition to an appeal was an act done for the purpose of keeping the original judgment in force within the meaning of the Act. Now, the opposition to an appeal would take place in the Appellate <ORG> which is not the <ORG> charged with the execution of the decree, and the Act, therefore, would be of even a more indirect character than the application in the present case.

3. I agree with the observations in <CITATION> . 3 Cal. 238 that any application in furtherance of an application to put a decree into execution may be held to be an application to enforce the decree. I think there are abundant reasons why such an application should be regarded as an application made in accordance with law to the proper Court to take a step in aid of execution, and I would dismiss the appeal with costs.

<NAME>, J.

4. At first I felt considerable doubt whether this application was not barred.

5. Section 238 of Act X of 1877 enacts that, when land is registered in <ORG>, the application for its attachment shall be accompanied by an extract from the register of such office, and in the case before us, the judgment-creditor applied, on the 22nd October 1880, to the <ORG> that passed the decree for a certificate that a copy of <ORG> of the land was necessary, in order to enable him to obtain such copy from <ORG>, and thereupon to execute the decree by attaching the land.

6. The question for decision is whether this application is a step in aid of execution within the meaning of Clause 4, Article 179 , Second Schedule of Act XV of 1877. At the hearing of the appeal, I doubted whether the step in aid of execution was not intended to be an application for some coercive process in actual enforcement of the decree, and whether it included an application which was in the nature of a mere preparation to apply for execution; but, on further consideration, I concur in the opinion of Mr. Justice <NAME>. Clause 4 refers first to an application for actual execution, and then to a step in aid of execution, and this leads to the inference that it may be some preliminary proceeding prior to actual execution. And this view is confirmed by Clause 5, which mentions as sufficient to save the statute, a notice under Section 248 of the Code of Civil Procedure to show cause why a decree should not be executed, though it is only a preliminary proceeding. Further, the latter part of Section 230 restrains judgment-creditors from keeping alive their decrees beyond twelve years by fruitless steps in aid of execution without earnestly endeavouring to obtain satisfaction of their decrees. There is also nothing on the record to show that a certificate such as was applied for was not necessary to obtain a copy of <ORG>, while the application for attachment must be accompanied with it under Section 238 . As the Act of Limitation is one which takes away the remedy and ought to be construed in case of doubt so as to advance the remedy, I am also of opinion that this appeal must be dismissed with costs.


PETITIONER: <NAME> Vs. RESPONDENT: h. C. PATEL DATE OF JUDGMENT: 29/09/1967 BENCH: <NAME>, K.S. BENCH: <NAME>, K.S. <NAME>, K.N. (CJ) BACHAWAT, R.S. <NAME>, V. <NAME>, <NAME> CITATION: 1968 AIR 445 1968 SCR (1) 735 CITATOR INFO : E 1970 SC 898 (20) RF 1975 SC 813 (14) F 1977 SC2279 (31) F 1990 SC 772 (8) ACT: Bombay Sales Tax Act (Bom. 5 of 1946) S. 12A(4)-If infringes Art. 19(1)(f ), Constitution. HEADNOTE: In view of Art. 286 (1) (a) of the Constitution, as it stood at the relevant time, the sales by the appellants- (registered dealers) outside the State of Bombay were not exigible to tax. The appellants.were directed to refund amounts collected by them from their purchasers in respect of these sales by way of tax, failing which the amounts would be forfeited under s. 12A(4) of the Bombay Sales Tax Act. The appellants filed a writ petition in <ORG> to restrain the respondents from taking action against them under s. 12A(4), <ORG> dismissed the petition. In appeal, this Court, Held: S. 12A(4) of the Bombay Sales Tax Act was void being violative of Art. 19(1)(f) of the Constitution. Prima facie the appellants were entitled to get the amount ordered. to be refunded to them. It was for the respondents to establish that the same was liable to be forfeited. Even according to the respondents that amount could be forfeited only as a measure of penalty. Under our jurisprudence no one can be penalised without a proper enquiry. [740 E-F]. The impugned provision which provided forfeiture of the amount in the hands of the dealers, did not lay down any procedure for ascertaining whether in fact the dealer concerned hid collected any amount by way of tax from his purchasers outside the State and if so what that amount was. Neither S. 12A(4) nor any rule framed under the Act contemplated any enquiry,, much less a reasonable enquiry in which the person complained of could plead and prove his case or satisfy authorities that their assumptions were either wholly or wholly wrong. This section did not contemplate adjudication nor provide for making any order. Hence, it was doubtful whether any appeal could be filed against a demand made under that section under S. 21 (740 G- H; 741-E]. <CITATION>  S.C.R 867, <CITATION> .  S.C.R. 519. <CITATION> , (19521 S.C.R. 597 followed. <NAME> v. Sales Tax Officer, Surat and another, 16 S.T.C. 1005 disapproved, JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 126 of 1966. Appeal from the judgment and order dated November 29, and December 2, 1963 of <ORG> in Special Civil Application No. 641 of 1962.

<NAME>, for the appellant.

<NAME>, <NAME> and <NAME>, for the respondents.

<NAME> and <NAME>, for the intervener. The Judgment of the Court was delivered by <NAME>, J.--The main controversy in this appeal by certificate is as to the constitutional validity of S. 12A(4) of the Bombay Sales Tax 1946, to be hereinafter referred to as the Act. As in our judgment that provision is void, the same being violative of Art. 19(1)(f) of the Constitution, we have not thought it necessary to examine the other contentions raised' in the appeal. The facts material for the purpose of deciding the question formulated above, are these: The appellants are dealers registered tinder the Act carrying on business in art silk, cotton and hand loom cloth. During the period January 26, 1950 to March 31, 1950, the appellants effected various sales outside the State of Bombay. As those sales were protected by Art. 286(1)(a) of the Constitution, they were outside the reach of the Act. But yet the sales tax officer assessed the turnover relating to those sales. The tax levied in respect of that turnover was Rs. 4,494/3/9. In appeal, the order of the sales tax officer was affirmed by the Assistant Collector of sales,tax. But the Additional Collector of sales tax in revision revised the levy to some extent and, ordered a refund of Rs. 2,238/0/6. That amount was paid to the assessees. Not being satisfied with the order of the Additional Collector of sales tax, the appellants took up the matter in revision to <ORG>. But even before they moved the <ORG> in revision, the Additional Collector of sales tax by his letter dated May 17, 1958, informed the appellants that unless they furnished to the sales tax officer proof of their having refunded the amount paid to them in pursuance of his order to the purchasers within a period of three months from the date of that notice, the same would be liable to be forfeited under s. 12A(4) The <ORG> by its 'order dated November 26, 1958, allowed the claim of the appellants in full and directed' the refund of an addi- tional sum of Rs. 2,256/2/6.

During the period April 1, 1950 to March 31, 1951 the appel- lants effected various sales outside the State of Bombay. The turn, over relating to those sales was also brought to tax by the sales tax officer and in that connection a tax of Rs. 23,806/3/6 was levied on the appellants. In appeal, the Assistant Collector of sale tax allowed the appellants' claim in part and ordered a refund or. Rs. 12,154/15/- but at the same time he informed them that that amount would be forfeited to <ORG> if not refunded to the purchasers from whom the same had been collected. No being satisfied with the relief obtained, the appellants went up in revision to the Additional Collector of sales tax. That officer by his order dated November 1, 1958 granted further relief by ordering refund of an additional sum of Rs. 3,588/1/9. But the sales tax officer did not give effect to that order. As the Additional Collector did not accept the appellants' claim in full, they went up in revision to the <ORG>. The <ORG> allowed their claim in full. The <ORG> took up the matter in reference to <ORG> but that reference was rejected. From the foregoing it is seen that in respect of the period April 1, 1950 to March 31, 1951- the appellants are entitled to get a refund of Rs. 23,806/3/6. Despite the aforementioned orders, the sales tax officer did not pay the amounts ordered to be refunded. On the other hand, he threatened to take steps to forfeit the same by having recourse to s. 12A(4) .

On June 27, 1962, the sales tax officer called upon the assessees to remain present in their office on July 2, 1962 with particulars of the amount collected by them by way of sales tax from the purchasers in 'other States during the period January 26, 1950 to March 31, 1951. At that stage, the appellants approached <ORG> by special civil application No. 641 of 1962 under Art. 226 of the Constitution. In that application, they prayed for several reliefs, the most important of which was to direct the respondents to comply with the orders of refund and to refrain from taking any action against them under s. 12A(4) . <ORG> dismissed that application. Hence. this appeal.

The Act provides for the levy of tax on the sale of goods in the then State of Bombay. It came into force on March 8, 1946. Any person who carries on business of selling or supplying goods in the State of Bombay whether for commission, remuneration or otherwise, is defined as a dealer in s. 2(c) . Section 8 and s. 8(a) of the Act provide for the registration of dealers. As mentioned earlier the appellants are registered' dealers. Under s. 2(k) of the Act, the assessment year is the financial year. Section 5 prescribes the incidence of taxation. Section 10 prescribes the returns to be made by the dealers. The assessment is made under s. 11 . Section 11 (a) provides for taxing the turnover escaping assessment. Section 12 provides for the payment and recovery of tax. Section 12A is the one with which we are concerned in this appeal. It reads:

"(1) No person shall collect any amount by way of tax under this Act in respect of sales or supplies of any goods which are declared, from time to time, under section 7 as sales or supplies on which the tax is not payable. (2) No person selling or supplying any goods shall collect from the purchaser any amount by way of sales tax unless he is a registered dealer and is liable to pay tax under this Act in respect of such sale or supply: Provided that this sub-section shall not apply in cases where a person is required to collect such amount of tax separately in order to comply with the conditions and restrictions imposed on him under the provisions of any law for the time being in force.

(3) Every registered dealer whose gross turnover exceeds Rs. 60,000 a year shall issue a bill or cash memorandum signed and dated by him or his servant, manager or agent to the purchaser in respect of the goods sold or supplied by him showing the particulars of the goods and the price at which the goods are sold or supplied shall keep the counterfoil or duplicate of such bill or cash memorandum duly signed and dated and preserve it for a period of not less than two years from such date. (4) If any person collects any amount by way of tax in contravention of the provisions of sub-section (1) or (2) or if any registered dealer collects any amount by way of tax in excess of the amount payable by him under this Act, the amounts so collected shall, without prejudice to any prosecution that may be instituted against such person or dealer for an offence under this Act be forfeited to <ORG> and such person or dealer, as the case may be, shall within the prescribed period, pay such amount into a Government treasury and in default of such payment, the amount shall be recovered as an arrear of land revenue."

In view of Art. 286(1)(a) of the Constitution as it stood at the relevant time, the appellants' sales outside the State of Bombay were not exigible to tax. Therefore if the appellants had collected any amount from their purchasers in respect of those sales by way of tax they had undoubtedly contravened sub-s. 2 of s. 12A . Sub-s. 4 of s. 12A provides for the forfeiture to State government any amount collected by a dealer by way of tax in excess of the amount payable by him under the Act. For the purpose of deciding the point in issue it is not necessary to find out the scope of the expression "collects any amount by way of tax" in s. 12A(4) . We shall assume, without deciding, the collection made by the appellants, if any, was by way of tax.

It was not contended nor could it have been contended that the impugned provision is a taxation measure bringing to tax directly or indirectly the sales effected outside the State of Bombay. <CITATION> ,(1) interpreting s. 11(2) of, the Hyderabad General Sales Tax Act 1952, a provision somewhat similar to, the impugned provision, this Court observed that legislation under Entry 54 of List II of the Constitution (similar to Entry 48 of List 11 of the Government of India Act, 1935, the entry with which we are concerned in this case) proceeds on 'the basis that the amount concerned is not a tax exigible under the law made under that entry, but (1)  6 S.C.R. 867.

even so lays down that though it is not exigible under the law, it shall be paid over to the government merely because some dealers by mistake or otherwise have collected it as tax; hence, it is difficult to see how such a provision can be ancillary or incidental to the collection of tax legitimately due under a law made under the relevant taxing entry. Therein it was held that it cannot be said that the State legislature was directly legislating for the imposition of sales or purchase tax under Entry 54 of List 11 when it made the provisions of s. 11 (2), for on the basis of the provision the amount that was collected by way of tax was not exigible as tax under the law. According to the <ORG> s. 12A(4) is a penal provision; and it provides for the imposition of penalty on those who contravene s. 12A(1) and (2). It was said on its behalf that power to enact such a provision is incidental to the power to tax sales. In support of that contention reliance was placed on the decision of <ORG> in <NAME> v. <ORG>, Surat and Another(1). That decision upheld the validity of s. 12A(4) . If that decision lays down the law correctly, then the appellants are out of court. But we think that the said decision cannot be sustained.

We shall not go into the question whether from the language of the impugned provision it is possible to hold that it is a penal provision. For our present purpose we shall assume it to be so. We shall also assume that the legislature had legislative competence to enact that provision. But the question is whether it is violative of Art. 19(1)(f) which guarantees the freedom to hold property. Prima facie the appellants are entitled to get the amount ordered to be refunded to them. It is for the respondents to establish that the same is liable to be forfeited. Even according to the respondents that amount can be forfeited only as a measure of penalty for the contravention of s. 12A(1) and (2). Under our jurisprudence no one can be penalised without a proper enquiry. Penalising a person without an enquiry is abhorrent to our sense of justice. It is a violation of the principles of natural justice, which we value so much.

The impugned provision which provides for the forfeiture of the amount in the hands of the dealers, does not lay down any procedure for ascertaining whether in fact the dealer concerned bad collected any amount by way of tax from his purchasers outside the <ORG> and if so what that amount is. Neither s. 12A(4) nor any rule framed under the Act contemplates any enquiry much less a reasonable enquiry in which the person complained of can plead and prove his case or satisfy the authorities that their assumptions are either wholly or partly wrong.

The Act is silent as to the machinery and procedure to be followed in determining the question as to whether there has been a contravention of ss. 12A(1) and (2), and if so, to what extent.

(1) 16 S.T.C. 1005.

L/P(N)7SCI-8 Hence it would be open to the department to evolve all the requisite machinery and procedure which means that the whole thing, from the beginning to end, is treated as of a purely administrative character, completely ignoring the legal position. The imposition of a penalty on a person is at least of a quasi-judicial character.

The impugned provision does not concern itself only with the amount admittedly collected by a person in contravention of sub ss. 1 and 2 of s. 12A. Even if there is any dispute either as to the facturn of collection or as to the amount collected, such a case also comes within the scope of s. 12A(4) . Yet that section does not provide for any enquiry on disputed questions of facts or law. The forfeiture provided for in S. 12A(4) prima facie infringes Art. 19(1)(f). Therefore it is for the respondents to satisfy the <ORG> that the impugned provision is a reasonable restriction imposed in the interest of the general public. Section 12A(4) does not contemplate the making of any order. As mentioned earlier, that section prescribes that if any registered dealer collects any amount by way of tax in excess of the amount payable by him under the Act, the amount so collected shall, without prejudice to any prosecution that may be instituted against him for an offence under the Act, be forfeited to the State government and he shall within the prescribed period pay such amount into a government treasury and in default of such payment the amount shall be recovered as arrears of land revenue. This section does not contemplate adjudication. Nor does it, provide for making any order. Hence, it is doubtful whether any appeal can be filed against a demand made under that section under s. 21 .

The question whether appellants in the instant case had been afforded a reasonable opportunity to establish their case or riot is besides the point. The constitutional validity of a provision has to be determined on construing it reasonably. If it passes the test of reasonableness, the possibility of powers conferred being improperly used, is no ground for pronouncing it as invalid, and conversely if the same properly interpreted and tested in the light of the requirements set out in Part III of the Constitution, does not pass the test, it cannot be pronounced valid merely because it is being administered in the manner which might not conflict with the constitutional requirements. On a reasonable interpretation of the impugned provision, we have no doubt that the power conferred under S. 12A(4) is unguided, uncanalised and uncontrolled. It is an arbitrary power. As held by this <ORG> in <CITATION> (1), whether the restrictions imposed by a. legislative enactment upon a fundamental right guaranteed by Art. 19(1) are reasonable within the meaning of Art. 19(5) would depend as much on the procedural portion of the law as the substantive part of it.

(1) [1950] S.C.R. 519.

Rao(1) wherein it was observed that in considering the reasonable That view was reiterated by this Court in <CITATION> . ness of laws imposing restrictions on fundamental rights both the substantive and procedural aspects of the impugned law should be examined from the point of view of reasonableness. This Court has taken that view consistently. A provision like the one with which we are concerned in this case can hardly be considered reasonable.

For the reasons mentioned above, this appeal is allowed. The order of <ORG> is set aside and a writ of mandamus will be issued to the respondents to comply with the refund order set out in the petition filed before <ORG> and to refrain from proceeding against the appellants under s. 12A(4) . The appellants are entitled to their costs both in this <ORG> and in <ORG>.

Y.P. Appeal allowed. (1) [1952] S.C.R. 597. P(N)7SCI-8(a)