CASE NO.: Appeal (crl.) 378 of 2005 PETITIONER: <NAME> and Anr. RESPONDENT: State of Tamil Nadu DATE OF JUDGMENT: 03/03/2005 BENCH: <NAME> & <NAME> JUDGMENT:

JUDGMENT <NAME>, J.

Leave granted.

Appellants call in question legality of the judgment rendered by <ORG> of <ORG> affirming their conviction and sentence for alleged commission of offence punishable under Section 302 of the Indian Penal Code, 1860 (in short the ` IPC '). Seven persons faced trial for allegedly having committed homicidal death of one <NAME> (hereinafter referred to as the `deceased') and causing injuries on various persons in furtherance of their common intention after forming themselves into an unlawful assembly. It was alleged that they had committed rioting, assaulted some of the witnesses causing injuries in addition to causing death of the deceased. They were charged for commission of offences punishable under Sections 147 , 148 , 323 , 307 , 302 read with Section 109 , Section 302 read with Section 149 and 307 read with Section 149 . <ORG> found that in respect of three persons (hereinafter described as A-4, A-6 and A-7) no offence was made out and, therefore, they were acquitted.

Two of the accused persons before <ORG> i.e. A-1 and A-2 were convicted of offence punishable under Section 324 . The present appellants who were A-3 and A-5 were convicted in terms of Section 302 . Though the prosecution had contended that all the accused persons acted in furtherance of common object being members of unlawful assembly and committed the crime, <ORG> did not accept the version. Considering the individual overt acts the learned Trial Judge had recorded conviction as afore-noted. So far as the present appellants are concerned, they were sentenced to undergo rigorous imprisonment for life.

Prosecution version as unfolded during trial is as follows:

<NAME> (hereinafter referred to as the `deceased') was the father of <NAME> (PW-1), <NAME> (PW-3) and <NAME> (PW-5). <NAME> (PW-2) is the cousin brother of PW-1. <NAME> (PW-4) is the wife of PW-5 and daughter-in- law of the deceased. PW-6 <NAME> was the brother of the deceased. The accused A-2 and A-7 are the sons of A-6 and others are their relatives. All are residing in a village called Kollumedu.

On 21.12.1993 one <NAME>, sister's son of <NAME> (A-1) was grazing the buffalos of A-1 in the lands belonging to PW-1's family. On seeing this, PW-5 assaulted him which was reported to A-1, who questioned the conduct of PW-5 in assaulting him. On hearing this news, deceased and <NAME> intervened and they were also assaulted, thereby straining the relationship.

On 22.12.1993 at about 8.00 a.m., PWs 1 and 2 were brushing their teeth near the common well of their village, Kollumedu. At the time, they noticed that <NAME> (A-1) was passing nearby. On seeing him, PW-1 questioned him as to whether it was fair on his part to assault PW-5 having grazed the buffalos in their land. A-1 took exception to this questioning by PW-1, threatened to assault him. Thereafter, there was a wordy altercation between A-1 and PW-1 in the presence of PW-2. A-1 became furious, went inside the house of A-6 which is very near to the common well and brought a stick, beat PW-1 on his back. Aggrieved by this conduct of A-1, PW-1 and his brother PW-2 chased him. A-1 took shelter in the house of A-6.

PWs 1 and 2 unable to retaliate and assault A-1, became unrestrained and were shouting in front of the house of A-6. A-3, <NAME> hearing the threatening calls of PWs 1 and 2, yelled, that PWs. 1 and 2 should be assaulted, even if a murder takes place since they had stepped into their house and shouted. Encouraged by the support, when PW-1 was standing in front of the house of A-6, A-2 came there with a weapon, assaulted PW-1 over his head. A-4 assaulted PW-1 by a reaper M.O.3. At the same time, A-1 assaulted him with an iron rod over the head. A-2 assaulted PW-2 and caused injuries. On seeing this incident, PW-3 also went there to their rescue. A-2 attacked <NAME> causing stab injuries. The father of PWs 1, 3 and 5 i.e. the deceased hearing this news, rushed to the scene of occurrence in their support. On seeing the deceased, A-3 and A-5 assaulted him over his head with yokes (M.O.5 and M.O.6), while A-6 caught hold of him, causing bleeding injuries of serious nature. PW-1 chased the accused, taking a stick available from the scene of occurrence. PW-6 on hearing the incident that his brother was assaulted came there, saw the injured and chased the accused away and in that process A-1 also sustained injuries. This incident was witnessed by <NAME>, <NAME> and <NAME>.

PW-1 and others took the deceased in an injured condition to <ORG> at about 11.30 a.m. Doctor (PW-8) attended on him and declared that he was dead at about 12.10 p.m. on 22.12.1993. Information was lodged at the police station. Investigation was undertaken and on completion thereof charge sheet was placed. The accused persons pleaded innocence and, therefore, the trial was conducted. After placing reliance on the evidence of the witnesses, more particularly, the injured eye witnesses PWs 1, 2 and 3 <ORG> found the accused persons guilty as aforesaid. The accused persons took the plea before <ORG> that they had also suffered injuries. The wife of A-6, namely, <NAME> and <NAME> mother of PW-4 were also injured. It is on record that the deceased and others had assaulted <NAME> and <NAME> and, therefore, in exercise of right of private defence the accused persons may have inflicted some injuries in the process of defending their life and property. <ORG> did not accept the plea. The conclusions of <ORG> were affirmed by <ORG> by the impugned judgment.

In support of the appeal, Mr. <NAME>, learned senior counsel submitted that the evidence on record clearly shows that ladies were assaulted first and to protect them under the apprehension of likely assault on them the accused persons in the process of protecting their lives and properties have made assaults, even if prosecution version is accepted in toto. Since the accused persons had exercised the right of private defence, the conclusions of the courts below cannot be maintained. The evidence on record establishes a free fight and the members of the complainant party were the aggressor. The accused persons have also suffered injuries in exercise of right of private defence.

In response, learned counsel for the respondent-State submitted that this is not a case where plea of right of private defence can be pressed into service. Merely because some of the accused persons have suffered some injuries which were superficial in nature, there is no question of interference with the well-reasoned and well-discussed judgment of the courts below.

Only question which needs to be considered is the alleged exercise of right of private defence. Section 96 , IPC provides that nothing is an offence which is done in the exercise of the right of private defence. The Section does not define the expression `right of private defence'. It merely indicates that nothing is an offence which is done in the exercise of such right. Whether in a particular set of circumstances, a person legitimately acted in the exercise of the right of private defence is a question of fact to be determined on the facts and circumstances of each case. No test in the abstract for determining such a question can be laid down. In determining this question of fact, the <ORG> must consider all the surrounding circumstances. It is not necessary for the accused to plead in so many words that he acted in self-defence. If the circumstances show that the right of private defence was legitimately exercised, it is open to the <ORG> to consider such a plea. In a given case the <ORG> can consider it even if the accused has not taken it, if the same is available to be considered from the material on record. Under Section 105 of the Indian Evidence Act, 1872 (in short `the Evidence Act '), the burden of proof is on the accused, who sets up the plea of self-defence, and, in the absence of proof, it is not possible for the <ORG> to presume the truth of the plea of self-defence. The <ORG> shall presume the absence of such circumstances. It is for the accused to place necessary material on record either by himself adducing positive evidence or by eliciting necessary facts from the witnesses examined for the prosecution. An accused taking the plea of the right of private defence is not necessarily required to call evidence; he can establish his plea by reference to circumstances transpiring from the prosecution evidence itself. The question in such a case would be a question of assessing the true effect of the prosecution evidence, and not a question of the accused discharging any burden. Where the right of private defence is pleaded, the defence must be a reasonable and probable version satisfying the <ORG> that the harm caused by the accused was necessary for either warding off the attack or for forestalling the further reasonable apprehension from the side of the accused. The burden of establishing the plea of self-defence is on the accused and the burden stands discharged by showing preponderance of probabilities in favour of that plea on the basis of the material on record. ( <CITATION> , AIR (1968) SC 702), <CITATION> , AIR (1975) SC 1478, <CITATION> , AIR (1977) SC 2226 and <CITATION> , AIR (1979) SC 577. Sections 100 to 101 define the extent of the right of private defence of body. If a person has a right of private defence of body under Section 97 , that right extends under Section 100 to causing death if there is reasonable apprehension that death or grievous hurt would be the consequence of the assault. The oft quoted observation of this <ORG> in <CITATION> ., AIR (1979) SC 391), runs as follows:

"It is true that the burden on an accused person to establish the plea of self-defence is not as onerous as the one which lies on the prosecution and that, while the prosecution is required to prove its case beyond reasonable doubt, the accused need not establish the plea to the hilt and may discharge his onus by establishing a mere preponderance of probabilities either by laying basis for that plea in the cross-examination of the prosecution witnesses or by adducing defence evidence...."

The accused need not prove the existence of the right of private defence beyond reasonable doubt. It is enough for him to show as in a civil case that the preponderance of probabilities is in favour of his plea.

The number of injuries is not always a safe criterion for determining who the aggressor was. It cannot be stated as a universal rule that whenever the injuries are on the body of the accused persons, a presumption must necessarily be raised that the accused persons had caused injuries in exercise of the right of private defence. The defence has to further establish that the injuries so caused on the accused probabilise the version of the right of private defence. Non-explanation of the injuries sustained by the accused at about the time of occurrence or in the course of altercation is a very important circumstance. But mere non-explanation of the injuries by the prosecution may not affect the prosecution case in all cases. This principle applies to cases where the injuries sustained by the accused are minor and superficial or where the evidence is so clear and cogent, so independent and disinterested, so probable, consistent and credit-worthy, that it far outweighs the effect of the omission on the part of the prosecution to explain the injuries. [ <CITATION> , AIR (1976) SC 2263]. A plea of right of private defence cannot be based on surmises and speculation. While considering whether the right of private defence is available to an accused, it is not relevant whether he may have a chance to inflict severe and mortal injury on the aggressor. In order to find whether the right of private defence is available to an accused, the entire incident must be examined with care and viewed in its proper setting. Section 97 deals with the subject matter of right of private defence. The plea of right comprises the body or property (i) of the person exercising the right; or (ii) of any other person; and the right may be exercised in the case of any offence against the body, and in the case of offences of theft, robbery, mischief or criminal trespass, and attempts at such offences in relation to property. Section 99 lays down the limits of the right of private defence. Sections 96 and 98 give a right of private defence against certain offences and acts. The right given under Sections 96 to 98 and 100 to 106 is controlled by Section 99 . To claim a right of private defence extending to voluntary causing of death, the accused must show that there were circumstances giving rise to reasonable grounds for apprehending that either death or grievous hurt would be caused to him. The burden is on the accused to show that he had a right of private defence which extended to causing of death. Sections 100 and 101 , IPC define the limit and extent of right of private defence.

Sections 102 and 105 , IPC deal with commencement and continuance of the right of private defence of body and property respectively. The right commences, as soon as a reasonable apprehension of danger to the body arises from an attempt, or threat, to commit the offence, although the offence may not have been committed but not until there is that reasonable apprehension. The right lasts so long as the reasonable apprehension of the danger to the body continues. In <NAME> v. State of Punjab, AIR (1963) SC 612, it was observed that as soon as the cause for reasonable apprehension disappears and the threat has either been destroyed or has been put to route, there can be no occasion to exercise the right of private defence.

In order to find whether right of private defence is available or not, the injuries received by the accused, the imminence of threat to his safety, the injuries caused by the accused and the circumstances whether the accused had time to have recourse to public authorities are all relevant factors to be considered. Similar view was expressed by this Court in <CITATION> , AIR (1975) SC 87. (See: <CITATION> ,  1 SCC 458 and <NAME> alias <CITATION> represented by Inspector of Police, T.N.  8 SCC 354.

As noted in <NAME> v. The State of Punjab, AIR (1991) SC 1316, a person who is apprehending death or bodily injury cannot weigh in golden scales in the spur of moment and in the heat of circumstances, the number of injuries required to disarm the assailants who were armed with weapons. In moments of excitement and disturbed mental equilibrium it is often difficult to expect the parties to preserve composure and use exactly only so much force in retaliation commensurate with the danger apprehended to him where assault is imminent by use of force, it would be lawful to repel the force in self-defence and the right of private-defence commences, as soon as the threat becomes so imminent. Such situations have to be pragmatically viewed and not with high-powered spectacles or microscopes to detect slight or even marginal overstepping. Due weightage has to be given to, and hyper technical approach has to be avoided in considering what happens on the spur of the moment on the spot and keeping in view normal human reaction and conduct, where self-preservation is the paramount consideration. But, if the fact situation shows that in the guise of self- preservation, what really has been done is to assault the original aggressor, even after the cause of reasonable apprehension has disappeared, the plea of right of private-defence can legitimately be negatived. The <ORG> dealing with the plea has to weigh the material to conclude whether the plea is acceptable. It is essentially, as noted above, a finding of fact.

The right of self-defence is a very valuable right, serving a social purpose and should not be construed narrowly. ( <CITATION> ., AIR (1971) SC 1857. Situations have to be judged from the subjective point of view of the accused concerned in the surrounding excitement and confusion of the moment, confronted with a situation of peril and not by any microscopic and pedantic scrutiny. In adjudging the question as to whether more force than was necessary was used in the prevailing circumstances on the spot it would be inappropriate, as held by this <ORG>, to adopt tests by detached objectivity which would be so natural in a <ORG> room, or that which would seem absolutely necessary to a perfectly cool bystander. The person facing a reasonable apprehension of threat to himself cannot be expected to modulate his defence step by step with any arithmetical exactitude of only that much which is required in the thinking of a man in ordinary times or under normal circumstances.

In the illuminating words of <NAME> (<NAME> on Crime, 11th Edition Volume I at page 49) :

"....a man is justified in resisting by force anyone who manifestly intends and endeavours by violence or surprise to commit a known felony against either his person, habitation or property. In these cases, he is not obliged to retreat, and may not merely resist the attack where he stands but may indeed pursue his adversary until the danger is ended and if in a conflict between them he happens to kill his attacker, such killing is justifiable."

The right of private defence is essentially a defensive right circumscribed by the governing statute i.e. the IPC , available only when the circumstances clearly justify it. It should not be allowed to be pleaded or availed as a pretext for a vindictive, aggressive or retributive purpose of offence. It is a right of defence, not of retribution, expected to repel unlawful aggression and not as retaliatory measure. While providing for exercise of the right, care has been taken in IPC not to provide and has not devised a mechanism whereby an attack may be a pretence for killing. A right to defend does not include a right to launch an offensive, particularly when the need to defend no longer survived.

Considering the background facts as highlighted above when tested in the backdrop of the legal principles noted supra the inevitable conclusion is that the accused persons had not established that they were exercising right of private defence. The residual plea is that only a single blow was given by a wooden yoke of very light weight. Though it cannot be laid down as a rule of universal application that whenever death occurs on account of a single blow, Section 302  is ruled out, the fact situation has to be considered in each case. It appears from the records, as noted above, that a single blow was given on the head of the deceased by a small wooden yoke. Considering the background facts as noted above, it would be proper to alter the conviction from Section 302  to Section 304 Part I . Custodial sentence of 10 years would meet the ends of justice.

The appeal is accordingly disposed of.


JUDGMENT <NAME>, J.

1. This is an appeal from the judgment of <NAME>, J., in Appeal No. 13 of 1950, reversing the decree and judgment of the learned <ORG>ordinate Judge, Cuddalore, in O.S. No. 19 of 1948. The plaintiffs who are the appellant here filed a suit on the foot of a mortgage, Exhibit A<ORG>1, dated 25th February, 1933, executed by the 4th respondent in favour of one <NAME>. <NAME> died in 1937, leaving as her heirs four sons and one daughter. One of the sons, <NAME>, was adjudicated an insolvent in I.P. No. 24 of 1933 on the file of the <ORG><ORG><ORG>, Cuddalore, and his estate became vested in the Official Receiver of South Arcot. The appellants who represent the interests of all the heirs of <NAME> except <NAME> filed a suit to recover the mortgage debt in the <ORG><ORG><ORG>, Cuddalore. Their claim was only in regard to their 7/9th share in the mortgage. They valued their share of the mortgage amount at Rs. 8,750 and giving up their claim in respect of Rs. 250 filed the suit to recover Rs. 8,500. Unfortunately they did not make either <NAME> or the Official Receiver, in whom the estate of <NAME> vested, as party to the suit. Respondents 1 to 3 and 5 claim to have purchased the interests of the mortgagor and the other respondents claim some interest either as alienees of portions or lessees of the hypotheca.

2. Respondents 1 to 3 and 5 and 6 objected to the frame of the suit in that the interest of <NAME> in the mortgage was not represented therein. The plaintiffs thereupon filed I.A. No. 524 of 1948 to implead the Official Receiver as party defendant and to amend the plaint. That application was ordered on 14th December, 1948, but it is admitted that on the date when the application was filed the suit had become barred in regard to the claim of <NAME>. The contesting respondents raised several questions but the most important of them were covered by issues 3 and 6 in the suit. They raised the question whether the plaintiffs were entitled to sue for their share of the mortgage amount alone and whether the suit as a whole was barred by limitation, as a necessary party had been impleaded out of time.

3. The learned Subordinate Judge held that as the Official Receiver was brought on record the suit was not barred and that the plaintiffs could maintain the suit for their 7/9th share. The learned Judge therefore passed a preliminary mortgage decree. Respondents 1 to 3 filed an appeal against that decree to this <ORG>. <NAME>, J., who heard the appeal held that the omission to implead the Official Receiver as a party defendant before the expiry of twelve years from the date fixed for redemption of the mortgage was fatal to the whole suit and, in that view, he dismissed the suit. The plaintiffs have, therefore, filed the above appeal under Clause 15 of the Letters Patent. Mr. <NAME> appearing for the appellants contended that the appellants could maintain the suit to recover their share of the mortgage amount and that the impleading of the Official Receiver after the period of limitation had expired in respect of the claim on the mortgage would not entail a dismissal of the suit in regard to the appellants' claim. He relied in this connection upon a decision of <ORG> in <CITATION> . In that case one of the two persons entitled to the mortgage money filed a suit to recover his share. The learned Judges held that a decree could be passed for the amount claimed in the absence of the other person interested in the mortgage money. They considered the question only from two points of view, namely, Order 1, rule, 9, Civil Procedure Code, and the hardship to the mortgagor. On the first question they held that as the controversy in the case was only in regard to the actual amount claimed, namely the share of the plaintiff and as the other mortgagee was not interested in the result of the suit, the omission to implead him would not entail the dismissal of the suit, as Order 1, Rule 9, Civil Procedure Code, enables the <ORG> to determine the rights of the parties actually before the <ORG>, leaving the rights and interests of others unaffected. They held that the mortgagor would not be affected by the suit as the claim of the other mortgagee was barred by the time the suit came up for hearing and that, therefore, there would be no case of a second suit being filed. We are unable to agree with the learned Judges who decided this case. It is well settled that a mortgage is one and indivisible in regard to the amount and security. <CITATION> (1898) I.L.R. 22 Mad. 209 at 211, <NAME>, J., observed as follows:

The pleader for the respondent urged strongly that the rule entitling a person to redeem the whole in circumstances like the present is opposed to principle in as much as a mortgagee, for whose benefit the rule that a mortgage is indivisible has been introduced, may waive it. But a mortgage for an entire sum is from its very purpose indivisible; a division of such a mortgage, borrowing the language of a text writer, is conceivable in theory and may be carried out in practice. But in order that a mortgage may fully attain its end of securing satisfaction of the entire obligation in the rank and with the efficacy which the law or the will of the parties determined, it is essential that it should not suffer any disintegration.

This character of indivisibility exists not only with reference to the mortgagee, who may generally be more benefited thereby, but also with reference to the mortgagor. And save as a matter of special arrangement and bargain entered into between of all the persons interested, neither the mortgagor nor the mortgagee, nor persons acquiring through either a partial interest in the subject, can, under the mortgage, get relief except in consonance with the principle of indivisibility referred to.

It is not open to some of the mortgagees to split up the debt without the concurrence of the other mortgagees and the mortgagor. <CITATION> (1937) 2 M.L.J. 666, Varadachariar, J., referred to the distinction between the case of a puisne mortgagee and a co-mortgagee and pointed out that while it was open to a puisne mortgagee to bring the hypotheca to sale subject to a prior mortgage, a co-mortgagee cannot sell it subject to the other co-mortgagee's right. The learned Judge observed:

Further, if it becomes necessary to sell the whole or anything in excess of a proportionate part of the hypotheca to realise even the amount due to the plaintiff-co-mortgagee, it will be neither fair nor consistent with the policy of the law to allow the plaintiff to appropriate the proceeds wholly in satisfaction of his claim. Justice can be done between all the parties concerned only by providing in the decree for the distribution of the sale proceeds amongst the co-mortgagees.

The learned Judge, therefore, was of opinion that a mortgage was a single cause of action. <CITATION> (1919) 37 M.L.J. 483 : L.R. 46 I.A. 272 : I.L.R. 47 Cal. 175 at 177 (P.C.), it was a case of a single mortgage executed in respect of the same property to secure two sums of money respectively payable to two mortgagees. <ORG> held that the mortgage clearly effected a conveyance of the real estate to the mortgagees as tenants is common and that it was not a mortgage to each of a divided half but a conveyance to them of the whole property. At page 179, Lord <NAME> observed:

Where a mortgage is made by one mortgagor to two tenants in common, the right of either mortgagee who desires to realise the mortgaged property and obtain payment of the debt if the consent of the co-mortgagee cannot be obtained, is to add the co-mortgagee as a defendant to the suit and to ask for the proper mortgage decree which would provide for all the necessary accounts and payments, excepting that there could be no judgment for a sum of money entered as between the mortgagee defendant and the mortgagor.

In <NAME> v. Rachappa I.L.R. (1948) Bom. 158, one of the heirs of a mortgagee filed a suit to recover the whole of the mortgage debt by sale of the secured properties without joining the other co-sharers in the mortgage either as plaintiffs or as defendants.

4. They were added subsequently at a time when the claim in respect of the mortgage had become barred by limitation. The learned Judges held that the suit should be deemed to have been instituted only when all the co-sharers, mortgagees, were impleaded and as by that time the period of limitation had expired, the suit failed. The basis of this decision was that all the mortgagees were to be represented in the suit not merely by virtue of the procedural law, Order 34, Rule 1, Civil Procedure Code, but by reason of substantive law and the contract between the parties which rendered the mortgage indivisible. It was held that Order 1, Rule 9, Civil Procedure Code, cannot be applied to save such a suit as it is not the right of any co-sharer mortgagee to obtain a decree with respect to his aliquot share of the mortgage money. The principle therefore is that there is indivisibility of the mortgage both in regard to the debt as well as in regard to the security and that no suit can be filed to enforce a mortgage which entails the disintegration of either of them. In the present case there is a further factor to be taken into account. The mortgagees are not joint promisees. The mortgage was originally executed in favour of a single individual, namely, <NAME>. The persons claiming the mortgage right are the several heirs of that lady who jointly get that right on her death by devolution under the law. That was an indivisible right which the mortgagee, <NAME>, had as the sole mortgagee. Therefore the right of this original mortgagee will be represented by all the co-sharers jointly. Even though they were co-owners under the Mahomadan Law, some of them alone cannot represent others and the absence of anyone of them from the array of parties in the suit would render the representation of the mortgagee's right defective.

5. The principle of the singleness of debt has been accepted in a number of decisions of this and other <ORG>. <CITATION> (1941) 3 M.L.J. 986 I.L.R. (1942) Mad.438, the question arose as to whether a co-mortgagee can sue for his share of the debt and if so what was the amount of <ORG>-fee that he had to pay. The learned Judges held that one of several co-mortgagees who are in the position of tenants in common could sue to recover his share of the mortgage amount, provided that he made his co-mortgagees defendants if they refused to join him as plaintiffs and he sued for the entire mortgage debt by paying the proper <ORG>-fee thereon. The learned Judges referred to the various cases and held that a decree should be passed in respect of the entire debt and that the plaintiff could not get his share until the mortgagor had paid into <ORG> what he owed under the mortgage or the mortgaged property had been sold under the preliminary decree. The primary claim must therefore be for the enforcement of payment of the entire mortgage debt and, if that were realised, the plaintiff would be paid his share. To the same effect is the decision of the Calcutta High <ORG> in <NAME> v. Bejav Lal Chakrabarti I.L.R. (1943) 1 Cal. 59, where it was held that a co-mortgagee whose share in the mortgage-money is defined or is otherwise ascertainable could maintain a mortgage suit for the share of his dues only if the other co-mortgagees are made defendants in the suit and if in such a suit there was a prayer for taking accounts of the total dues under the mortgage, and for the sale of the whole of mortgaged premises for such dues. On the question of amount of <ORG>-fees to be paid for such a suit, the learned Judges expressed a different view.

6. We have referred to the decision in <NAME> v. Rachappa I.L.R. (1948) Bom. 158, where it was held that a suit filed at the instance of some of the co-mortgagees without impleading the rest was defective and could not be held to be legally laid. <CITATION> , followed the <ORG> decision in <NAME> v. Rachappa I.L.R. (1948) Bom. 158. <CITATION> (1947) 1 M.L.J. 279, the question arose in a different form. Two of the three mortgagees filed a suit on the foot of the mortgage for recovery of the whole amount, impleading the third mortgagee as one of the defendants. The <ORG>, however, passed a decree only for two thirds share of the amount due to the plaintiffs and directed the other mortgagee to recover his one third share in a separate suit. The mortgaged properties were not sold through <ORG> but were sold privately to the appellant who paid off the decree debt. In a suit by the other mortgagee to recover his share of the mortgage amount, it was held that by reason of the previous decision expressly reserving the right of the defendant mortgagee to proceed with the mortgaged properties, the claim was maintainable. The learned Judges considered the cases on the subject and held that the former decree proceeded upon a defective basis but that in the circumstances of the case the defendant mortgagee's rights were left unaffected. In a recent unreported decision by one of us in S.A. No. 1919 of 1949, it was held that a decree could not be passed for part of the mortgage debt. As pointed out by the learned Judges who decided <CITATION> (1947) 1 M.L.J. 279, the law as to how a suit by one of the several co-mortgagees is to be framed is fairly clear. The suit should be for the entire debt and all the mortgagees should be made parties to the suit. This is based not merely on the principle underlying Order 34, Rule 1, Civil Procedure Code, and the principle that the mortgagor should not be harassed by several litigations in respect of the same mortgage, but on the substantive principle of the mortgage law, that the debt as well as the security of the mortgage is indivisible. Normally all the mortgagees should join but, if some of them refuse to join, they should be included as defendants. Such mortgagee defendants are not pro forma parties but are necessary parties in that the mortgage right vests in them along with the plaintiffs mortgagees. The omission therefore to implead them within the time when the mortgage remains enforceable would result in the dismissal of the suit as the plaintiffs would not completely represent the mortgagees interests. The learned Judges of the Patna High <ORG> in <CITATION> , considered the case only from the point of procedural law and of the hardship to the mortgagor. We find that the attention of the learned Judges was not invited to the substantive law regarding the indivisibility of the mortgage. Both on principle and on authority the decision in that case appears to us to require reconsideration. In this connection it is necessary to point out that an omission to implead all the mortgagees either as plaintiffs or as defendants is different from a case where all the persons interested in the equity of redemption are not impleaded as parties. In such a case the omission to implead some of the persons interested in the equity of redemption will not entail the dismissal of the suit as the rights of the parties who are before the <ORG> can be adjudicated leaving the rights of others not made parties to the action unaffected. Vide <NAME> v. <NAME> (1933) 65 M.L.J. 108 : I.L.R. 56 Mad. 846 (F.B.).

7. We, therefore, agree with <NAME> J., that the suit as laid was incompetent and that having regard to the provisions of Section 22 of the Limitation Act, the addition of the Official Receiver after the period of limitation had expired would not render the suit competent on the date on which it was filed.

8. The result is that the appeal fails and is dismissed.


JUDGMENT <NAME>, J.

1. These tax revision cases and the writ petitions raise a common question of law, challenging the validity of the amendment to Section 8-B(2) of the Madras General Sales-tax Act introduced by Madras Act I of 1957. It will be convenient to deal with this point first before setting out the facts of each case and considering the contentions turning upon them.

2. Section 8-B, as it stood before its amendment by Madras Act I of 1957, reads:--

"8-B (1). No person who is not a registered dealer shall collect any amount by way of tax under this Act; nor shall a registered dealer make any such collection except in accordance with such conditions and restrictions, if any, as may be prescribed.

Provided that <ORG> may exempt persons who are not registered dealers from the provisions of this sub-section until such date, not being later than the 1st day of April 1948, as <ORG> may direct.

2. Every person who has collected or collects any amount by way of tax under this Act, on or after the 1st day of April 1947, shall pay over to <ORG> within such time and in such manner as may be prescribed, all amounts so collected by him if they are in excess of the tax, if any, paid by him for the period during which the collections were made."

The words in Section 8-B(2),--"and in default of such payment, the amounts may be recovered as if they were arrears of land revenue" were deleted by Section 7 of the Madras Act 15 of 1956. <CITATION> , 1954-5 STC 382 a Division Bench of this Court (<NAME> and <NAME>) held that what a registered dealer was empowered to collect from purchasers under Section 8-B (1) of the Madras General Sales-tax Act was only what was lawfully leviable as tax and that a collection by a registered dealer from his purchasers under a mistaken conception of the liability of his transaction to be assessed under the Act was not liable to be paid over to <ORG> as the collection was not a realisation by way of tax. At page 393, <NAME> observed thus:

"What Section 8-B (2) requires of every person is that he should pay over to <ORG> 'all amounts so collected by him', that is, all amounts collected by way of tax. That in the case of a registered dealer, shouts apply only to what he could collect by way of tax within the meaning of Section 8-B (1). In the case of the unregistered dealer, though he lacks the authority conferred on the registered dealer by Section 8-B(1), to make any collections, the expression "so collected by him" would only apply to the collection referred to in the earlier part of Section 8-B (2), the collection of any amount 'by way of tax under this Act' In both cases, the interpretation 'by way of tax lawfully leviable under this Act' would fit in with the obligations imposed by Section 8-B(2) though we realise the anomalous position of an unregistered dealer on whom no rights were conferred but on whom only obligations were imposed".

3. This decision opened the eyes of the <ORG>, and Madras Act 1 of 1957, which took effect from 14-1957, was the result. Section 8-B(1) and the proviso was not in any way modified or amended by this later Act. Section 8-B(2) was re-enacted in the following terms:

"Every person who has collected or collects any amount purporting to be by way of tax under this Act on or after the 1st day of April 1947, whether or not any tax is due from him under this Act in respect of the transaction in which he has collected or collects such amount, shall pay over to the (State) Government within such time and in such manner as may be prescribed, all amounts so collected by him if they are in excess of the tax, if any, paid by him for the period during which the collections were made."

The newly introduced words are "any amount purporting to be by way of tax"; instead of the words (as they were prior to the amendment) "any amount by way of tax under this Act." The further addition brought in by the amendment is the following:

"Whether or not any tax is due from him under this Act in respect of the transaction in which he has collected or collects such amount."

The meaning of this amendment is quite plain and un-mistakable. Any person, whether he is a registered dealer or not, who collects amounts from others transacting with him, is obliged to pay the collection to <ORG> irrespective of the question whether such collection could have been lawfully made by him or not and whether he, the collector, is liable to be assessed under the Act or not. By reason of the decision in 1954-5 STC 382 (Mad) referred to above, persons who had illegally and umauthorisedly collected amounts under the guise of tax from their purchasers obtained immunity from payment to <ORG>. It is quite obvious that the amendment was brought in to do away with the effect of that decision. The intendment of the legislation is that any amount collected in the name of tax should be paid over to <ORG> by the person collecting the amount independently of his liability to be assessed to tax. Does the legislative competence of the <ORG> extend to enact such a measure--is the question that is mooted now.

4. Mr. <NAME>, learned counsel appearing for some of the aggrieved assessees, submits that Entry 54, List II, Schedule VII of the Constitution--"Taxes on the sale or purchase of goods other than newspapers"--claimed to be the root of the <ORG>'s power to legislate the impugned provision, cannot permit the <ORG> to collect any amount, which is not tax under the Act, from any person. Learned counsel contends that the statutory right empowering the <ORG> to collect from an assessee an amount, which is ex concessis not a tax levied under the Act, cannot, of course, be called a right to levy a tax on sale or purchase, and cannot therefore be a subject matter of the topic within the <ORG>'s taxing power. The argument is developed in the following manner. If it is not permissible for the <ORG> to make any illegal levu of tax outside the scope of the Act, it is not equally permissible for the <ORG> to enrich itself by appropriating the illegal collection made by the assessee under the pretext of the Act, as the <ORG> cannot do indirectly what it cannot do directly. It is impossible to sustain the validity of the amendment by invoking the doctrine of incidents or ancillary power, which <ORG> legislature has to effectuate and enforce legislation within its ambit and power, as what is rendered effective is improper and ultra vires acts and not legitimate activities within the sphere of the Act. This, in substance, is the argument of the eminent counsel, which is quite fascinating and plausible, and which therefore requires, and merits, deep consideration.

5. The learned Advocate General, appearing for the <ORG>, urges in a very succinct and able argument, that the provisions of the amended Section 8-B(2) of the Act are intra vires, being within the competence of the <ORG> legislature. His argument runs thus. The working of the Act manifested at least four evils consequent upon the abuse of the provisions of the Act by dealers and other persons: (1) registered dealers collected taxes from their purchasers properly leviable under the Act; but some of them failed to pass on the collections to the <ORG> as they were not within the charging section, being persons with less than the minimum turnover of Rs. 10,000; (2) dealers collected tax from their purchasers at a higher rate than that prescribed by the Act and paid to the <ORG> only at the proper rate and pocketed the difference; (3) dealers collected amounts from their purchasers under the guise of tax when their transactions were not within the Act and appropriated the amounts for themselves, as they could not be, and were not, assessed by the <ORG>; and (4) persons who were not dealers at all and who were only commission agents and brokers, collected tax from others who transacted with them and got the benefit themselves as they were not inside the Act.

This situation was anomalous, and, indeed, called for stern action, lest persons should exploit the public--the consumers in general--who bear the brunt of the taxation. To suffer illegal payments in the name of tax is nothing but detestable extortion. The <ORG>, therefore, stepped in particularly after the decision in the 1954-5 STC 382 (Mad) to remedy the baneful consequences resulting from the Act and enacted the impugned measure, not with a view to improve the resources of its exchequer by transgressing its limits of taxing power, but to interdict unscrupulous persons from abusing the statute to serve their ends and purposes. The exercise of power in introducing the amendment is well within the topic of "Tax on sale and purchase" in Entry 54, list II, Schedule 7 of the Constitution, as it is a power necessary, incidental and ancillary to the primary and main power. The amendment is in the nature of a penal provision to curb the illegal activities under cover of the Act, and is essential to the effectiveness of the power to legislate on tax on sale and purchase.

6. The proper interpretation of the enumerated powers of the legislature has been the subject matter of decisions by <ORG> and <ORG> and other <ORG> in other countries having legislative bodies with defined and specified powers. The well-accepted canon of construction is that the words describing the legislative powers should receive a wide and liberal meaning, and blind adherence to a strictly verbal interpretation must be avoided. The enumerated powers must be effectively put in operation lay legislation. An impotent piece of legislation, while it may adorn the Statute book, is as good as not having been enacted at all. The doctrine of incidental and ancillary power has necessarily to be invoked to prevent a statute becoming ineffective, in <CITATION> , <ORG> observed "It is a fundamental principle of constitutional law that everything necessary to the exercise of a power is included in the grant of the power."

This observation is approved and affirmed by a later decision of <ORG> reported in <CITATION> , . The following observation in <NAME> v. <NAME>, (1884) 10 AC 119 at 129 emphasises the usefulness of incidental and ancillary power:

"When you have got a main purpose expressed and ample authority given to effectuate that main purpose, things which are incidental to it, and which may reasonably and properly be done and against which no express prohibition is found, may and ought prima facie to follow from the authority for effectuating the main purpose by proper and general means."

We may also refer to a passage from the judgment of the Australian court, bringing out the same idea, in <NAME> v. <ORG>, 23 CLR 226 at 233, which runs thus:

"The Constitution marks the outlines of the powers or the national legislature, but does not undertake, as a code of laws would, to enumerate the sub-divisions of those powers as to specify all the means of executing them. Laws, which, in the language of the American Constitution are necessary and proper, or, in the language of the Austra-Man Constitution, incidental to the execution of the power, are alike constitutional."

In <ORG> <NAME>, AIR 1941 FC 18 at 25, Sir <NAME>, C. J. laid down the same doctrine in the following words:

"None of the items in the List is to be read in a narrow or pedantic sense and each general word should be held to extend to all ancillary and subsidiary matters which can fairly and reasonably be said to be comprehended in it."

This observation is quoted with approval by <NAME>, J, in the recent decision of <ORG> already referred to, namely, .

7. In a statute falling, within the enumerated topic of legislation, provisions enacted to ensure and achieve the effectiveness of the Act should not be treated as alien to the subject-matter of the legislation. The competency of the legislature to make such provisions cannot be tested as if they stand apart and are severable from the main enactment A matter not otherwise within the enumerated powers may be legislated upon as an incident to the exercise of an enumerated power.

7a. "What is 'incidental' in any given case depends upon the main legislation and the circumstances of the particular case--the question of 'incidentally'--must of course, as <ORG> observed in <ORG> v. <NAME>, (1914) 19 CLR 298, be determined ab extra, irrespective of Parliamentary assumption on the matter." (<ORG>, 2nd Edn., pages 493, 494.)

8. In <NAME> v. <NAME>, 86 CLR 169, it was held by <ORG> that the forfeiture imposed by the Customs Act was incidental for the purpose of vindicating the Customs Laws and was not an acquisition of property in respect of which the <ORG> was empowered to make laws. <NAME>, C. J. observed at page 177:

"Everything which is incidental to the main purpose of a power is contained within the power itself so that it extends to matters which are necessary for the reasonable fulfilment of the legislative power over the subject-matter ................... .These matters of incidental powers are largely questions of degree, but in considering them, we must not lose sight of the fact that once the subject-matter is fairly within the province of the <ORG> legislature, the justice and wisdom of the provisions which it makes in the exercise of its powers over the subject-matter are matters entirely for the <ORG> and not for the <ORG>."

We have to consider the question whether the conferment of right in favour of <ORG> to compel payments of amounts collected by persons taking advantage of the machinery of the Act is the result of the exercise of ancillary power of <ORG> attached to the power to enact a law in respect of tax on sale and purchase. The <ORG> has undoubtedly no power, by which it can enact a law to connive at or be a party to, illegal collection of amount purporting to be tax. But, in order to ensure the proper working of a law relating to tax on sale and purchase and to prevent the law from being abused, it can introduce measures interdicting such abuses, or enact provisions to prevent any mischief from being done under colour of the Act. The assumption of such a power to legislate can only be regarded as an incidental or ancillary power to effectuate the undoubted proper power to enact a tax-law. The competency of the <ORG>'s power to legislate should not be adjudged merely from the result of <ORG> appropriating to itself the proceeds of illegal exaction made by persons taking shelter under the Act.

Surely, the <ORG> has not empowered any person, whether a registered dealer or not, to collect amounts not leviable as tax under the Act The object of the amendment to Section 8-B (2) under Madras Act I of 1957 as revealed, by the plain words of the amendment, is only to put a check upon persons misusing the Act to their own advantage, we can use a familiar expression and say that the pith and substance of the amendment is not to levy an ad hoc tax on transactions which are not sales or purchases, but to introduce a measure in the nature of forfeiture or confiscation of the unlawful gains made by persons who found themselves in a position to take undue advantage of the Act.

9. We shall now refer to the decisions cited on behalf of the petitioners. <CITATION> . , the validity of the proviso to Section 11-A of the Bihar Sales-tax Act, 1947 was in issue. The proviso reads thus:

"Provided that if any dealer collects any amount by way of tax in contravention of the provisions of this section or the conditions and restrictions prescribed thereunder, the amount so collected shall, without prejudice to any punishment to which the dealer may be ....... liable for an offence under this Act, be forfeited to <ORG>, and such dealer shall pay such amount into the Government treasury in accordance with a direction issued to him by the Commissioner or any officer appointed under Section 3 to assist him, and, in default of such payment, the amount shall be recovered as an arrear of land revenue."

<ORG> held that this provision was unconstitutional and invalid. <ORG>, however, did not find it necessary to consider the validity of the provision, as it was of opinion, that the proviso could not be invoked against the assessee on the particular facts of the case. The decision of <ORG> was therefore affirmed on other grounds. <NAME>, J. observed that courts should be reluctant to decide constitutional points merely as matters of academic importance. This decision cannot therefore help us in solving the problem now before us.

10. In <ORG>P.) <CITATION> , , the validity of the Madras General Sales-tax (Definition of Turnover and Validation of Assessments) Act, 1954, came in for consideration. The headnote correctly sets out the ratio of the decision :

"The true effect of Section 8-B of the Madras General Sales-tax Act, 1939 and the Madras General Sales-tax (Turnover and Assessment) Rules 1939 is that (a) a registered dealer is enabled to pass on the tax, (b) an unregistered dealer cannot do so, and (c) the amount collected by way of tax is to be shown separately, for it has to be paid over to Government. This does not mean that it is incompetent to the legislature enacting legislation pursuant to Entry 54 in List II by suitable provision to make the tax paid by the purchaser to the dealer together with the sale-price in consideration of the goods sold, a part of the turnover of the dealer; nor does it mean that the tax, as imposed by Government, is a tax on the buyer, making the dealer a mere collecting agency, so that tax must always remain outside the sale price. When the seller passes on the tax and the buyer agrees to pay sales tax in addition to the price, the tax is really part of the entire consideration and the distinction between the two amounts--tax and price--loses all significance from the point of view of legislative competence."

Mr. <NAME>, learned counsel for the petitioners, relied on this case mainly to emphasise the fact, that the dealer who collects the tax from his purchaser and upon which a liability is fastened to pay over the proceeds to the <ORG>, is not the agent ex contracts or statutory of the <ORG>. According to the learned counsel, the registered dealer, who is clothed with the right under Section 8-B (1) to collect the tax from his purchased, has a statutory right inhering in himself and the amount that may be collected by him represents his own moneys, in respect of which he is not liable to account to the <ORG>, though, If he were to be assessed under the Act, the transaction in respect of which he had collected the tax would also be included in the taxable turnover. The learned Advocate General, however, contends that the person who is authorised to collect the tax payable by him to the <ORG> from other persons occupies a fiduciary position not far different from that of an agent.

In support of this contention, he referred us to the decision in <NAME> v. Attorney-General, 1951 AC 507. in that case, one <NAME> was a sergeant in <ORG> on active service in Egypt. Wearing military uniform, he accompanied civilian lorries transporting illicit spirits to specified, destinations. By his accompanying the convoy of illicit transport, he avoided inspection of the goods conveyed under the lorries. For these services, he received in all 20,000. The military authorities took possession of this, amount from his hands, tried him by Court-Martial, and convicted him. After his release from prison, he claimed, by Petition of Right, from the <ORG> the return of we amount seized. <ORG> held that he was not entitled to recover the money. One of the grounds of the decision was that <NAME> occupied a fiduciary relationship, as he was a soldier under the <ORG>. At page 516, Lord <NAME> observed:

"I agree with <NAME>, L. J. in thinking that the words 'fiduciary relationship' in this setting are used in a wide and loose sense and include inter alia a case where the servant gains from his employment a position of authority which enables him to obtain the sum which he receives."

This decision of <ORG> was referred to by <ORG> in 1954-5 STC 382 (Mad) at p. 392. At page 392, <NAME>, J. observed, "Weighty though these observations are and entitled to the profoundest respect, they cannot apply to the determination of the limited issue before us. We are not concerned now with the question--what are the rights and liabilities of the <ORG> and a registered dealer in an action at common law for the recovery of the collections made under colour of Section 8-B (1), but in excess of the authority, and subsequently paid over to the <ORG>. The limited issue before us is, what is the extent of the statutory obligation created by Section 8-B (2) of the Act. As we have already pointed out, Section 8-B(2) applies to both the collections made by a registered dealer who is authorised to collect, and by an unregistered dealer who is forbidden to collect by Section 8-B (1). It applies to 'every person who collects any amounts by way of tax under this Act.' That aspect should not be lost sight of in construing the scope of the obligation cast alike by Section 8-B (2) on the registered dealer and on the unregistered dealer. Neither of them is in the position of a servant vis-a-vis the <ORG>."

It is not necessary for us to go into the question as to the jural relationship between the <ORG> and an unregistered or a registered dealer in respect of transactions where such dealers have collected amounts from other persons purporting to be by way of tax, but not really tax due and payable, as the question of the competency of the legislature cannot depend upon that relationship. If the position of the <ORG> were held to be that of a principal and the position of the dealer that of an agent, the legislature cannot permit either the principal or the agent to collect taxes by an illegal levy. If the relationship between the <ORG> and the dealer is not that of a principal and an agent, even then, the legislature cannot, in exercise of its power to enact a tax-law on sale and purchase, permit an illegal levy. We are therefore of opinion that the position of the <ORG> vis-a-vis the dealer is not a relevant criterion to be taken into account to comprehend the <ORG>'s power of legislation to enact the amendment.

11. The learned Advocate-General referred us to the following decisions of <ORG> of the United States. In United States v. <ORG>, (1933) 78 Law Ed 859, it was held that a federal statute conditioning the right to a tax-refund on a showing by a claimant that he alone had borne the burden of the tax did not infringe the due process clause of the Fifth Amendment. In 93 American Law Reports (Annotated), <ORG>'s case, (1933) 78 Law Ed 859, is referred to, and it is observed that that case puts at rest the conflict in the decisions of the various lower federal, courts as to the, interpretation of the statute concerned. In 119 American Law Reports (Annotated), the following observation occurs at page 549:

"To prevent the unjust enrichment of a manufacturer who had collected from the purchasers the tax assessee under the Agricultural Adjustment Act, but who, because of the subsequent invalidation of that Act, had either not paid such tax to <ORG>, or, having paid it, had recovered it back, but had not turned it over to the persons' upon whom the burden of tax had ultimately fallen. <ORG> enacted in the Revenue Act of 1936 a provision, in effect imposing an income-tax upon such manufacturer in respect of such amounts held or collected the constitutionality of the Act was sustained in <ORG> v. <NAME>, 1957 D.C. 17 F. Suppl. 934. The Court said that, even if it were conceded that its object was to recapture excess taxes already assessed and which had been returned but the tax payers are not paid, it could not be said to be arbitrary, further observing: The tax-payer is made to turnover to the <ORG> not something which belongs to him, but a tax which he had added to his cost and collected from others, but which was not collected from him ........ Truly, the tax is, as named, a tax on unjust enrichment, and enrichment not at the expense of an individual, but at the expense of a buying public and the <ORG> which imposed the tax. A tax so conceived has none of the ear-marks of the arbitrariness which would bring it under interdict of the fifth amendment."

We must observe that these American decisions are really concerned with the question whether a particular enactment was offensive of the due process clause of the American Constitution. In the United States of America, taxing statutes are not outside the due process clause. In India, the doctrine of due process does not apply and the Constitution only lays down that a tax cannot be imposed except under the authority of the law ( Article 265 of the Constitution).

12. We need refer only to one more decision, and that is the decision of <ORG> in <CITATION> , . In our opinion, this decision clinches the issue in favour of the <ORG>. The facts of that case are as follows. <ORG> was an assessee under the Orissa Sales-tax Act. They were manufacturers of paper and paper boards, and were registered as dealers under the Act. They used to collect tax from the purchasers on all sales effected by them including sales to dealers in other <ORG>s. For the quarters ending 31-3-1950, 30-6-1950, 30-9-1950 etc., they paid sales-tax on their turnover, which included outside sales.

After the decision of <ORG> in <ORG> case, <CITATION> ., , they applied for refund, under Section 14 of the Act, of tax paid in respect of goods despatched for consumption outside the State of Orissa, contending that, according to the lavy expounded by <ORG>, the transactions of sales outside the State were not taxable under the Act. Refund was refused by the Assistant Sales tax Officer and the order was confirmed by <ORG>. In the view of the taxing authorities, the orders of assessment had become final on the dates on which they are made and were not liable to be reopened, merely on the ground that the law applicable to the transactions was not correctly appreciated by the taxing authorities. The assessee filed petitions for the issue of writs of certiorari and mandamus against the orders of <ORG> in <ORG>. <ORG> held that, the only restriction upon the right of a dealer to apply for refund being the law of limitation prescribed by the previso to Section 14 of the Orissa Act and the transactions in question not being liable to tax as they were Inter-State transactions, the tax collected must be refunded on applications submitted within the prescribed period.

Accordingly, <ORG> negatived relief to the assessee for the refund of tax paid for the first two quarters as being barred by limitation, but granted relief for the remaining three quarters. Both the State of Orissa and the assessee preferred appeals to <ORG> against the said decision of <ORG>. <ORG> brought an amendment to the Orissa Sales-tax by Act 27 of 1958. The amendment is in these terms:

"Notwithstanding anything contained in this Act, where any amount is either deposited by any person under Sub-section 3 of Section 9-B or paid as tax by a dealer and where such amount or any part thereof is not payable by such person or dealer, a refund of such amount or any part thereof, can be claimed only by the person from whom such person or dealer has actually realised such amounts whether by way of sales-tax or otherwise and the period of limitation in the proviso to Section 14 shall apply to the aforesaid claims."

13. It was not disputed before <ORG> that the amending provision barred the assessee's right to obtain refund of tax. It was, however, contended that the Act was beyond the competence of <ORG>, and that, in any event, it was void, because it imposed an unreasonable restriction upon the assessee's fundamental right guaranteed under Article 19(1)(f) of the Constitution. Dealing with the question of competency of the legislature, <NAME>, J. observed thus at page 612 (of <ORG>) : (at p. 1440 of AIR):

"The power to legislate with respect to a tax comprehends the power to impose the tax, to prescribe machinery for collecting the tax, to designate the officers by whom the liability may be enforced and to prescribe the authority, obligations and indemnity of those officers. The diverse heads of legislation in the Schedule to the Constitution demarcate the periphery of legislative competence and include all matters which are ancillary or subsidiary to the primary head. The legislature of the Orissa State was therefore competent to exercise power in respect of the subsidiary or ancillary matter of granting refund of tax improperly or illegally collected, and the competence of the legislature in this behalf is not canvassed by counsel for the assessees. If competence to legislate for granting refund of sales-tax improperly collected be granted, is there any reason to exclude the power to declare that refund shall be claimable only by the person from whom the dealer has actually realised the amounts by way of sales-tax or otherwise? We see none. The question is one of legislative competence and there is no restriction, either express or implied, imposed upon the power of the legislature in that behalf."

We are aware of the fact that, to some extent, a concession was made in that case in urging the contention regarding the competency of the legislature. But this, in our view, does not really affect the ratio of the decision.

14. There is another decision of <ORG>, , Messrs. <CITATION> in which the decision just cited, been followed. The assessee in that case was a firm carrying on business as building and works contractors. The Sales-tax Officers administering the Orissa Sales-tax ACT, 1947 treated the transfer of the materials used in the construction of the buildings, roads and bridges as sale of goods and assessed the firm to tax. The assessee relying upon the judgment of this court in <CITATION> , 1954-5 STC 216, (AIR 1954 Mad 1130), moved a writ petition in <ORG> for the issue of directions directing the State of Orissa and its Sales-tax Officers to refund the amount of tax and penalties realised from them. During the pendency of the writ petition, <ORG> affirmed the decision of <ORG> in <CITATION> , .

<ORG> declared that the assessment of sales tax was not in accordance with law and directed that no steps should be taken to realise the arrears of sales-tax in respect of the works contracts. <ORG> also directed refund of tax paid if recovery thereof was not barred under Section 14 of the Orissa Sales-tax Act of 1947 on the date of the filing of the application. In the appeal filed by the assessee against the order of <ORG> holding that a portion of refund claimed was barred by limitation under Section 14 of the Act the provisions of Section 14 of the Act were challenged as ultra vires of <ORG>. Section 14 of that Act reads :

"The Collector shall, in the prescribed manner, refund to a dealer applying in this behalf any amount of tax paid by such dealer in excess of the amount due from him under this Act, either by cash payment or, at the option of the dealer, by deduction of such excess from the amount of tax due in respect of any other period:

Provided that no claim to refund of any tax paid under this Act shall be allowed unless it is made within 24 months, from the date on which the order of assessment was passed or within 12 months of the final order passed on appeal, revision, review or reference in respect of the order of assessment, whichever period is later."

The contention urged on behalf of the assessee was that <ORG> had no power to restrict We right to obtain refund of tax illegally collected by imposing a period of limitation. The Orissa Act was enacted by <ORG> in exercise of legislative authority conferred upon it by item 48 of List II of the Schedule VII of the Government of India Act, 1935. <ORG> quoted the passage extracted above from their decision in , and observed thus:

"If the power to legislate in respect of tax comprehends the power to legislate in respect of refund of tax improperly or illegally collected, imposition of restrictions on the exercise of the right to claim refund will not be beyond, the competence of the legislature. Granting refund of tax improperly or illegally collected and the restriction on the exercise of that right are both ancillary or subsidiary matters relating to the primary head of tax on sale of goods. The provisions of Section 14 of the Act are therefore not ultra vires the State legislature."

The principle of this decision can properly be invoked to decide the vires of the impugned provision under the Madras General Sales-tax Act.

15. There is another view of the matter tending to uphold the legislative competence. A registered dealer gets a right to collect the tax only under the Act and his obligation to pay over the collected amount to the <ORG> is part of that very right. He cannot enjoy that right free from the duty imposed as a necessary fetter upon that right. It is within the province of the <ORG> to create such a right coupled with a duty in favour of a dealer within the Act. An unregistered dealer is prohibited from collecting the tax leviable and the necessary consequence of such a dealer violating the prohibition should be that he is accountable to the <ORG>. The liability to pay over the collections to the <ORG> is imposed on the unregistered dealer only to render effective the statutory interdiction against him. Surely, both the interdiction and the obligation to pay are within the province of the <ORG>'s power to legislate.

16. We are clearly of opinion that the impugned legislation does not transgress the limits of the State's power under Entry 54, List II, Schedule 7 of the Constitution. The State has not in substance, enacted any measure of law unrelated to tax on sales and purchases, but has only exercised its undoubted subsidiary and ancillary power to effectuate the existing piece of legislation in regard to that subject matter. We hold that the amendment introduced to Section 8-B(2) by reason of Madras Act I of 1957 is intra vires and valid.

T. C. Nos. 196 to 198 of 1959:

16a. The petitioner in these three tax revision cases is an incorporated company carrying on business in aluminium metal and its alloys at Calcutta. The company consigned goods to Madras by rail and obtained railway receipts in its name. After receipt of the price, the railway receipts were endorsed in favour of the consignees at Madras. The goods despatched from Calcutta were delivered at Madras for consumption in the Madras State. These sales clearly fell within Section 22 of the Madras General Sales-tax Act. The following table gives the particulars regarding the sales-tax due by the company in respect of these transactions and the amount of tax which the company had collected from its purchasers:

App. No. Asst. Year.

Sales- tax due.

Sales-tax demanded.

1953-54 8,538-2 0 4,213-9.9 1954-55 9,981-13-9 10,476 11-9 1955-56 upto 6-9-1955 8,630-1-3 7,837-6-3 The contention raised by the assessee-company before the taxing authorities, as also before <ORG>, was that these transactions were inter-<ORG> sales not liable to be taxed by the Madras <ORG>. It was also con tended that, in any event, the property in the goods passed at Calcutta under the terms of the contract between the company and its purchasers and that the mere fact of delivery of the goods inside the <ORG> would not entitle the <ORG> to levy a tax on the sales. It was further contended that, though tax had been collected by the company, the <ORG> was not entitled to have the collected amounts under Section 8-B(2) of the Act, as amended by Madras Act I of 1957, as the said provision is ultra vires. The <ORG> quite properly declined to go into the question of the vires of the legislation and held that, irrespective of the fact that the property in the goods passed at Calcutta, the sales were within the ambit of Section 22 of the Madras General Sales-tax Act, as delivery of the goods was for purposes of consumption inside the <ORG>.

17. We have already held that Section 8-B(2) is valid and intra vires. There is really no substance in the contention that the property in the goods passed outside the State and that therefore the transactions were not taxable events under the Madras General Sales-tax Act. Section 22 of the Madras General Sales-tax Act is, practically, the same as explanation to Article 286(1) of the Constitution, and these sales can be described as 'explanation sales'. It has been held by <ORG> in <CITATION> , that, in sales in which goods are delivered for consumption in a particular State, the property therein shall be deemed to have passed inside that State alone, which may be called the "Delivery" State. At p. 317 of STC): (at p. 481 of <ORG>), <NAME> observed thus:

"The sales in which- property passes outside the State of Madras, but delivery for consumption is inside Madras, are at once inside sales for Madras and outside sales for the other States."

In view of this decision, it is really unnecessary for us to consider whether the petitioner is well founded in its contention that the property in the goods passed only at Calcutta and not at Madras at the time and place of the delivery.

18. In respect of assessment years 1953-54 and 1955-56, the tax due by the company is more than the tax collected by the company from its purchasers. The question of this applicability of Section 8-B(2) of the Act does not come in for consideration in respect of these two assessment years. For the assessment year 1954-55, the tax collected by the company is Rs. 10476-11-9 while the tax due by it is Rs. 9981-13-9. It is only the difference between these two amounts which falls within the scope of Section 8-B(2) . As we have already held that the said provision is valid and enforceable, the decision of the <ORG> is correct. These revision petitions fail and are dismissed with costs in T. C. No. 196 of 1959. Counsel's to Rs. 150.

W. P. No. 589 of 1959:

19. The petitioner prays for the issue of a writ of prohibition or other appropriate writ under Article 226 of the Constitution to forbear the respondent, the Deputy Commercial Tax Officer, <NAME>, from collecting the sum of Rs. 2622-21 under Section 8-B(2) of the Madras General Sales-tax Act.

20. The petitioner is a firm of partnership carrying on business as publishers and sellers of law books. The firm is a registered dealer under the Madras General Sales-tax Act. During the period 14-1957 to 30-6-1957, the inter-State sales effected by the petitioner were not liable to sales-tax either under the Madras General Sales-tax Act, 1939, or under the Central Sales-tax Act , 1956, as the sales of the books were completely exempted, from tax under the Madras Act. The firm, however had collected sales-tax from its purchasers in respect of inter-State sales effected during that period. The amount so collected was Rs. 2622-21. While assessing the turnover of the firm for the year 1957-58, the taxing authorities claimed to recover this sum of Rs. 2622-21 under Section 8-B -(2). A demand having been made for payment over, the present writ petition has been filed.

21. We have already held that Section 8-B(2) is intra vires and it is therefore clear that the petitioner must submit to the demand of the <ORG> to pay over this sum of Rs. 2622-21. Learned counsel for the petitioner argued that there was no separate demand under Form B-2 in respect of this amount and that therefore the amount could not be recovered. Even as a technical ground of objection, this plea is wholly without substance. The claim of the <ORG> to compel the petitioner to pay over this amount squarely falls within the specific provisions of Section 8-B (2) and there are certainly no grounds for resisting the claim. The petition fails and is dismissed with costs. This Rule nisi is discharged. Counsel's fee Rs. 150.

W. P. No. 1067 of 1959:

22. The petitioner prays for the issue of a writ of certiorari or other appropriate writ under Article 226 of the Constitution to quash the order of the Assistant Commercial Tax Officer, <ORG>, Madras, dated 10-10-1958 in A. 2/598/53-54 under the following circumstances.

23. The petitioner is a firm of partnership carrying on business as building contractors at Madras. In the assessment year 1953-54 the taxing authorities under the Madras General Sales-tax Act assessed the net value of the building contracts in the sum of Rs. 11,69,369-/-0. The petitioner contended that building contracts were not within the Act and that the taxing authorities had no jurisdiction to levy tax under the Madras General Sales-tax Act. In 1954-5 STC 216: (AIR 1954 Mad 1130), this court held that building contracts fell outside the scope of the Act. This decision was affirmed by <ORG> in its decision . In view of this decision, the taxing authorities held that the petitioner was not liable to pay any tax under the Act. But it must be mentioned that the petitioner had collected the sum of Rs. 9442 from the owners of the buildings, for whom the contracts were executed. Subsequently, the Assistant Commercial Tax Officer, <ORG>, by his order, dated 10-10-1958, revised the previous order of assessment holding the petitioner immune from tax, and held that the petitioner was liable to pay the sum of Rs. 9442 under Section 8-B(2) of the Act.

This revision was made by the taxing authorities, acting under Rule 18 of the Madras General Sales-tax Rules, which enables the authorities to rectify an error apparent on the face of the record. The petitioner's attempt to have the said order set aside by way of appeal and revision having failed, this writ petition has been preferred.

24. In view of our decision that Section 8-B(2) of the Act is intra vires and valid, the petitioner can no longer resist the action of the State under that provision. It cannot be said that there was no case for the authorities to act under Rule 18 of the Madras General Sales-tax Rules. The Assistant Commercial Tax Officer, in his original order of assessment dated 4-5-1956, held that the taxable turnover of the petitioner was nil, and he also stated in that order of assessment that there was no demand under Section 8-B(2) of the Act, clearly overlooking the fact that the petitioner had collected a sum of Rs. 9442 by way of sales-tax from its constituents. This was clearly a mistake apparent on the record. We are of opinion that Rule 18 of the Madras General Sales-tax Rules applies and the Assistant Commercial Tax Officer had jurisdiction to rectify the mistake.

25. It is urged on behalf of the petitioner that the original assessment order became final and could not be reopened, if there are grounds for the authorities to act under Rule 18--and we have held that there are grounds for so acting--the previous order of assessment cannot be said to have become indefeasibly final.

26. Another argument is pressed upon us, and that is that an action by the <ORG> under Section 8-B(2) of the Act can only be part of the assessment proceedings and cannot be a proceeding independent of such assessment. We are unable to agree. Rule 5-A of the Turnover and Assessment rules indicates that a recovery by the <ORG> of the amount collected by a dealer under Section 8-B(2) is not part and parcel of the assessment based upon the charging section, namely, Section 3 of the Act. Rule 5-A, in so far as it is material, may be set out:

"5-A(7). A registered dealer may collect amounts by way of tax or taxes under the Act, subject to the following conditions:

1. He shall not collect any amount or amounts by way of tax or taxes under the Act at a rate or rates exceeding the rate or rates specified in Section 3(5) or 5-A or notified under Section 6(1) ;

2. He shall pay in full the amount or amounts collected by him by way of tax or taxes to <ORG> on or before the 30th April of the year succeeding in which such collection is made; .....

9. If the assessing authority is satisfied that any amount or amounts collected, by the dealer by way of tax or taxes have not been paid by him to <ORG> in any year as required by condition 2 in Sub-rule 7, the assessing authority shall issue a notice to the dealer in form B. 2 specifying therein the total sum so withheld by the dealer and the dealer shall pay such sum at the time and in the manner specified therein."

It may be noted that the form of demand in pursuance of an order of assessment is form B. 1(A). Apart from the fact that different forms have been prescribed, one for recovery of demand resulting from regular assessment and the other for collection of the amount due and payable under Section 8-B(2) of the Act, there is enough indication even in the language of Section 8-B(2) to show that the liability of the dealer is independent of his liability under the charging section of the Act. The words "whether or not any tax is due from him under this Act in respect of the transaction in which he has collected or collects such amount"

in Section 8-B(2) quite clearly make out that the liability to pay over the collected amount is de hors the liability as dealer under the other provisions of the Act.

27. The petitioner cannot lawfully resist the claim of the <ORG> to pay over the sum of Rs. 9442 collected by it, purporting to be by way of sales-tax from its constituents. The writ petition fails and is dismissed with costs. Rule nisi is discharged. Counsel's fee Rs. 100.

W. P. Nos. 817 and 818 of 1959:

28. The petitioner in these two writ petitions prays for the issue of a writ of certiorari or other appropriate writ under Article 226 of the Constitution to quash the order of the Deputy Commercial Tax Officer, Mylapore, dated 3-6-1958 in A. 2/227/54-55 relating to the assessment year 1954-55.

29. The petitioner is a firm of partnership carrying on business as building contractors. For the year 1953-54, the firm filed monthly returns in A. 3 form and paid in all the sum of Rs. 7014-1-0. In the bills submitted by the firm to its customers, sales-tax was included and claimed. In this manner, a sum of Rs. 4578-44 was collected by the firm from its constituents. Similarly, for the year 1954-55 the firm paid tax to the <ORG>, amounting to Rs. 1752, out of which the collection made by it from its constituents was the sum of Rupees 543-15-0. Following the decision of this court in <NAME> case 1954-5 STC 216: (AIR 1954 Mad 1130), the Deputy Commercial Tax Officer, by his orders dated 29-9-1956 for the year 1953-54, and 21-1-1957 for the year 1954-55, excluded the entire turnover of the petitioner in respect of the building contracts and ordered refund of the tax paid.

Subsequently, the Deputy Commercial Tax Officer demanded the sum of Rs. 4578-44 and the sum of Rupees 543-15-0 for the two years from the petitioner on We ground that the petitioner was liable to pay the amount to the <ORG> under Section 8-B(2) of the Act. The petitioner challenged the vires of the provision and resisted the collection. After some abortive proceedings by way of appeal and revision, the petitioner has approached this court under Article 226 of the Constitution.

30. Section 8-B(2) of the Act has been held valid by us. The petitioner's contention challenging the vires of the provision has therefore to be negatived. The petitioner also raised the contention that the previous order of assessment had become final, that it could not be reopened and that there could not be a claim under Section 8-B(2) of the Act, apart from assessment proceedings. We have held that the proceedings under Section 8-B(2) of the Act are independent of assessment proceedings and that such proceedings need not necessarily and always form part of the assessment proceedings. The right of the <ORG> to collect the amount from the dealer, if the requisites of Sub-section (2) of Section 8-B are complied with, cannot be defeated I merely on the ground that the assessment proceeding against the dealer had become complete and final. This contention also fails.

31. In the result, these writ petitions are dismissed. Rule nisi is discharged. The petitioner will pay the respondent's costs in W. P. No. 817 of 1959. Counsel's fee Rs. 150. There will be no order as to costs in W. P. No. 81S of 1959.

W. P. Nos. 1213, 1214 and 1215 of 1959:

32. The petitioner in all these three writ petitions is a private limited company, carrying on business as building contractors in the City of Madras. The petitioner was assessed for the year 1949-50 under the Madras General Sales-tax Act by the Deputy Commercial Tax Officer, Thyagarayanagar, on a turnover of Rs. 35,08,153-5-0. This assessment was disputed on the ground that the receipts comprised in the turnover were in respect of building contracts and the supply of food grains to the start and workmen of the company and were therefore beyond the scope of the Act. The petitioner's contention in this behalf was accepted by this Court in the decision reported in 1954-5 STC 216: (AIR 1954 Mad 1130). The <ORG> went up on appeal to <ORG> but the decision of this court was affirmed and the judgment of <ORG> is .

In consequence of the judgment of <ORG>, there was a revised assessment by the Deputy Commercial Tax Officer. The petitioner had collected sales-tax in respect of these work contracts from its constituents and the amount so collected was Rs. 13080-6-9. The tax due and payable by the petitioner in respect of the assessable turnover was Rs. 5222-2-1. The excess of tax, collected over the tax payable by the petitioner was Rupees 7858-4-8. After making the revised assessment the taxing authorities withheld this sum of Rs. 7858-4-8 and directed a refund of the balance due as the petitioner had already paid a total tax of Rs. 56950. W. P. No. 1213 of 1959 is directed against this order of the Deputy Commercial Tax Officer.

33. For the year 1950-51, the petitioner had collected tax from, its constituents the sum of Rs. 179/9-14-6. But the tax payable by it to the <ORG> was only Rs. 3594-6-0. The taxing authorities demanded from the petitioner the sum of Rs. 16969-91 nPs. representnig not merely the tax payable by the petitioner but also the excess of amounts collected by it from its constituents over the amount due and payable by it to the department. This order forms the subject-matter of W. P. No. 1214 of 1959.

34. For the year 1951-52 the petitioner had collected the sum of Rs. 26127-3-1 from its constituents, while the tax due by it to the department was only Rs. 3848-14-3. The excess of the amount of tax due by the petitioner namely the sum of Rs. 22278-4-10 is claimed by the department and this is disputed in W. P. No. 1215 of 1959.

35. The following tabular statement gives the particulars in regard to the three years in question. (Herewitn annexed) (Omitted here since it is not material for purposes of this report.--Ed.)

36. The claim of the <ORG> against the petitioner in all these three years, 1949-50, 1950-51 and 1951-52 is really based on Section 8B(2) of the Madras General Sales-tax Act. The vires of this provision was challenged by learned counsel for the petitioner, but we have held that the said provision is valid and intra vires. It was further contended on behalf of the petitioner that there is really no excess available in the hands of the petitioner which can enable the <ORG> to claim the right of payment under Section 8-B(2) of the Act. In all these years the petitioner paw the tax which certainly included the amount collected from the constituents.

The petitioner's claim for the refund of the amount on the basis that the turnover in respect of the works contracts was not assessable was met with the counter claim of the <ORG>, that the collected amounts should be paid over to the <ORG> under Section 8-B(2) of the Act. The figures given above unmistakably show that the petitioner had collected amounts from its constituents which were not lawfully payable by way of tax under the Act. If the petitioner had not handed over the amounts so collected to the <ORG> the claim under Section 8-B(2) cannot be resisted. It follows that the collections having been made over to the <ORG> Government, the petitioner will not be entitled to any refund, as it is open to the <ORG> to retain the amounts in its hands in view of the provisions of Section 8-B(2) of the Act. There is really no substance in the plea urged on behalf of the petitioner that the ingredients of Section 8-B(2) are not present to warrant the action taken by the taxing authorities.

37. These writ petitions therefore fail and are dismissed. Rule nisi is discharged. The petitioner will pay the costs of the respondent in W. P. No. 1213 of 1959. Counsel's fee Rs. 150.