JUDGMENT <NAME>, C.J.

1. In my judgment this suit ought to have been dismissed on the ground that the right claimed by the plaintiffs was not cognizable by <ORG>.

2. Assuming that the suit related to a matter of which <ORG> could take cognizance, I agree with the view taken by the learned Judge who tried the case. I think the plaintiffs failed to make out any case and that the suit was rightly dismissed.

3. I propose to deal with the case first, as the learned Judge dealt with it, that is, on the assumption that the suit was cognizable by <ORG>.

4. The plaintiffs' case was that a certain temple, of which the defendant was Dharmakarta, had been built and a goddess consecrated for the special benefit of worshippers residing in certain streets in Black Town, Madras ; that those worshippers and their descendants had contributed towards the expenses of the festivals appertaining to the goddess and enjoyed the right of having the goddess carried in procession in front of their houses in order that they might perform worship at the several stoppages ; that from time immemorial the customary route for the procession, except on certain special occasions, included a street known as Kristnaswami Covil Street, in which the plaintiffs resided; that the defendant, with a view to injure the plaintiffs and other residents in Kristnaswami Covil Street, proposed to vary the customary route by omitting therefrom the whole of the said street; and the plaintiffs claimed a declaration of their rights, an injunction that future processions should take the alleged customary route, and damages. The defendant's case was that the temple was founded for the benefit of the Kamara or Panchala community of the Town of Madras ; that the right of management of the temple and its affairs is vested in the members of that community as recognised by a decree of this Court ; and that the temple was not built nor the goddess con- secrated for the benefit of worshippers residing in streets forming the alleged customary route. The defendant denied that the plaintiffs had acquired, or could acquire, any legal right by reason of any custom or practice to have the procession carried through any particular streets, and contended that the manner of conducting the processions was a matter involving religious ritual which depended on various considerations ; that the discretion of the Dharma-kartha and the sabha appointed to manage the affairs of the temple was not subject to any external influence or control; and that, in varying the route of the procession, the Dharmakartha had acted bona-fide and in the best interests of the temple.

5. There is a distinction between the case of the 1st and 5th plaintiffs, who are members of the Kamara caste for whose benefit the defendant alleges, and the plaintiffs do not appear to deny, the temple was instituted, and that of the 2nd, 3rd and 4th defendants, who were not members of this caste but merely residents in the street in question who had been in the habit of availing themselves of the opportunity to worship when the procession passed down their streets. As regards plaintiffs 2, 3 and 4, I am clearly of opinion that they have established no right. They are not members of the Kamara caste, they have no proprietary interest in the institution, they have no voice in the appointment of the Dharmakartha, and they have no control over him. I know no principle of law upon which it can be said by custom, prescription, or otherwise, plaintiffs 2, 3 and 4 have acquired any rights as against the defendant. It is not a case in which a man claims a right by custom to do a certain act. "Plaintiffs 2 to 4 claim a right by custom not merely to worship the goddess but to compel the defendant to bring the goddess past their houses in order that they may worship. As regards plaintiffs 2 to 4 the fact that they resided in the particular" street gave them the opportunity of participating in certain religious advantages which they would not otherwise have enjoyed. The fact they enjoyed these advantages for a certain period gives them no rights as against the defendant,

6. The case of plaintiffs 1 and 5, however, stands upon a different footing. There was no evidence before the Court below as to the route taken for the procession prior to 1874. From 1874 to 1878 there were no processions at all ; but from 1878 onwards it was agreed that the practice had been, except in the case of a death in the street and on certain specified occasions, for the procession to pass through Kristnaswami Covil Street. Plaintiffs 1 and 5 based their alleged rights entirely on mamool. The defendant contended that he had a discretion with regard to the route which the processions should take. In a case which came before this Court in 1881 (Subbaraya Gurukal v. Chellappa Mudali I.L.R. 4 M. 315 in which the custom with reference to ceremonies and processions in connection with idols was involved, Sir <NAME>, C.J., and Sir <NAME>, J., observe: "We believe there is no general custom by which this question can be at once decided. It may be the Dharmakarthas have no power to change custom ; it may be that they, or a majority of them, have a discretion to do so either arbitrarily or in accordance with what they honestly believe to be the wishes of the worshippers."

7. In his evidence the 1st plaintiff stated that the plaintiff belonged to the Kamara community and that only members of that community are entitled to interfere in its management; that there are 18 houses in the street, the other houses being inhabited by members of other castes. The 1st plaintiff's evidence with reference to the custom upon which he relied was somewhat confused, but he appears to have stated that if the procession started it must pass through Kristnaswamy Covil Street, that the length of the route of the procession depended on the money available, but that the procession must pass through certain specified streets whether there was money or not, and that if money was not forthcoming, the temple must borrow for the purpose. He stated that if a large majority of the worshippers wished the route of the procession to be changed, the defendant must act according to <NAME>, and that even if the houses on both sides of the street fell down and no one lived in it the procession would still have to go up that street. Upon the 1st plaintiff's own statement of the custom upon which he relies it seems to me that the alleged custom is so unreasonable,--unreasonable, I mean, from the point of view of the community for whose benefit the institution was founded and the processions are conducted--that I should be prepared to hold that no such custom in fact exists. There is, however, other evidence as to the nature of the alleged custom, A Dharmakartha of a neighbouring temple was called as a witness on behalf of the plaintiffs. He stated that for the last 20 or 30 years, except when the processions were stopped on account of disputes, the procession had passed down the Krishnasami Covil Street. He also stated according to the learned Judge's note of his evidence, that the route of processions depends upon the wishes of the people living in the streets and the pleasure of the Dharmakartha, that processions generally keep the same route, and that it depends upon the wishes of the people through which the processions go. The witness mentioned the names of two other temples and stated that the processions in connection with these temples did not pass through the same streets they used to pass through. He also stated that the matter depended upon the wishes of the people--those living in the <NAME> streets and others.

8. The testimony of this witness is quite inconsistent with the evidence given by the 1st plaintiff. To my mind the 1st plaintiff's evidence is discredited by that given by his own witness--the neighbouring Dharmakartha. Without saying that the defendant's discretion in regard to the route of the procession is absolute (as the defendant puts his case in written statement), it seems to me that the custom as spoken to by the Dharmakartha witness is more reasonable and more probable. To say that a trustee in a case such as this has no discretion appears to me anomalous. It is not necessary to attempt to define the limits of his discretion or the principles upon which he should seek to exercise it. It is enough to say that, in my judgment, the plaintiffs have failed to establish a custom which absolutely precludes the defendant from the exercise of any discretion and that he failed to make out his case. In this view it is not necessary to consider the--to my mind--much more difficult question as to whether the right claimed by the plaintiffs is a right cognizable by <ORG>. As this question, however, was fully argued before us, I propose to deal with it. I have come to the conclusion that the right claimed by the plain-tiffs is not one on which <ORG> can adjudicate. The dividing line between the class of cases involving questions of religious ritual and usage of which <ORG> can take cognizance and the class of cases involving questions of which it cannot, or at any rate will not, take cognizance is not very clearly defined. The strongest case in favour of the appellant's contention is the decision of this court in Venkatachalapati v. Subbarayadu I.L.R. 13 M. 293. There a Smarta Brahman claimed the right to enter the inner shrine (where orthodox Brahmains usually made their offerings) of a certain temple. The committee of the temple refused to allow him to enter the inner shrine on the ground that he had married a widow contrary to the Hindu Sastras. In the course of his judgment Sir <NAME> observed, "The right which the appellant claimed in the plaint and which he asked the court to protect, was a right of access to the inner shrine or sanctum sanctorum of a Hindu temple for the purposes of religious worship, and the ground of claim was that prior to his marriage with a Hindu widow, he had that right, and that he did not since forfeit it by reason of such marriage. The question whether with reference to its perquisites, the right continued to exist after his marriage was one which related to the merits, and whatever might be the decision in regard to it, the right was, in its nature, one which the appellant was at liberty to assert as a citizen and a Brahman and which the courts were bound to adjudicate upon. It may be that an enquiry as to religion or caste, or as to the religious foundation for the excommunication pronounced by the chief priest of <NAME>, is indispensable to coming to a correct decision, but when the right claimed is asserted to be of a civil nature and which is within the cognizance of <ORG>, they are bound to hold such enquiry as is ancillary to the exercise of the jurisdiction vested in them by law." The <ORG> directed findings to be returned on the following issues:

1. Whether the general custom of Brahmans worshipping or entitled to worship, in the temple mentioned in the plaint, continued to prohibit, at the date of the suit, marriage with a widow?

2. If so, whether, according to the usage of the temple mentioned in the plaint or according to the original and recognized intention of the foundation, regard being had to its nature and character as a religious and caste institution and to the customary mode of treating those who transgress general caste customs, and thereby lose or impair their caste status, those Brahmans who marry widows are excluded from the inner shrine of the temple by the original and recognized? trusts of the, institution." In the case above referred to the right claimed was "not an exclusive personal right, or a right of domestic or family worship, or a right of property which may be conceived to exist independently of caste or religion, but a joint right to be exercised in a religious institution conformably to caste usage to the extent recognized by it so as not to contravene the equal rights of other members of the caste who are similarly interested in the institution" (p. 299). The question for decision in that case was "what was the recognized general usage of the caste...whether it was against his (the plaintiff's) marriage with a widow, and if so, whether a departure from that affected his caste status so as to deprive him of the right claimed" (p. 300). In that case the right claimed was one enjoyed by every Brahman, as a Brahman, in common with every member of the community. The question the court adjudicated upon was whether, according to the usage of the temple, a Brahman who married a widow disqualified himself for the enjoyment of this right. In the present case the plaintiff claims a personal right, not common to the community, which, he says, he is entitled to enjoy, in perpetuity on the ground of custom. The custom of which the court took cognizance in the case of <NAME> v. Subtarayadu I.L.R. 13 M. 293, was--not the plaintiff's right of access to the inner shrine (which is inherent in all Brahmans who have not become disqualified), but the general usage of the Brahmans which forbids marriage with a widow. The custom we are asked to take cognizance of in this case is a special custom under which the plaintiffs claim a special privilege not common to the community generally and not essential to the purposes of worship. The plaintiffs do not invoke the aid of the court in order that they may not be obstructed when they go to worship the goddess, but they ask the court to order that the goddess should be brought to them, because, by custom, they have acquired a personal right to require that this should be done. The plaintiffs' claim in the present case appears to me to be essentially different from the claim in the case reported in I.L.R. 13 M. 293.

9. The view that the present suit comes within the class of cases which a civil court is not competent to adjudicate upon appears to be well supported by authority. In Special Appeal No. 94 of 1861 (Judgments of the Madras Sudder Court, 1861, page 152), the plaintiffs and defendants worshipped at the same temple but were members of different castes. The suit was brought to regulate the ritual of the temple service, one of the grounds of contention between the parties being whether the images should be taken out in procession. The question of taking out the images in procession, however, does not appear to have been raised in the special appeal, and the court declined to entertain the suit on the ground that no pecuniary considerations were involved and that the contests related purely to the constituents of religious worship. The only other case to which our attention has been directed in which that of an idol in procession was involved is a decision of Sir <NAME>, C.J., and Sir <NAME>, J., reported in Subbaraya Gurukal v. Chellappa Mudali I.L.R. 4 M. 315. But in that case the plaintiff was the Dharmakartha of the temple and entitled to maintain the suit by reason of the property in the idols being vested in him as a trustee. The right to perform the religious services of an idol is no doubt in a sense "property," and as such is partible (see the judgment of Sir <NAME> in the case reported in <NAME> v. <NAME> 14 B.L.R. 166 but in my judgment, the right set up by the plaintiffs in the present case cannot, without giving an altogether forced and unnatural meaning to the word, be described as a right of property. In the case reported in Striman Satagopa v. Krishna Tatachariyar and <NAME>. 1 M.H.C.R. 301 it was held by this court that a Hindu priest could not sue in respect of the withholding of religious observances due to his sacred rank, but unconnected with any special office held by him, although the non-performance of these observances might have caused him some ascertainable pecuniary loss. In the case reported in <CITATION> . 2 B. 476 the plaintiffs set up an alleged hereditary right to take a cupola to a certain temple and place it upon the car of the idol. The court refused to entertain the suit on the ground that it was brought to vindicate the plaintiffs' right, not to an office but to a mere dignity unconnected with any fees, profits or emoluments. On the other hand it has been held by this court in the case reported in <CITATION> . 6 M., 151, that a suit by a dancing girl whose offerings to the idol had been rejected by the priest on the ground that she had misconducted herself, and in a case reported in Srinivasa v. Tiruvengada I.L.R. 11 M. 450, that a suit to establish the plaintiffs' right to present a crown and water to certain persons on certain festivals in a certain temple was cognizable by <ORG>. It will be observed that in both these cases the right claimed was a right to perform acts of worship in a temple. In the present case the right claimed is to have the object of worship brought to the plaintiffs. The distinction may seem fine, but it seems in Accordance with the general proposition laid down by Sir <NAME> in the first of the two cases just referred to. The proposition is "The members of a sect are entitled, subject to the rules made by the duly constituted authorities of the sect, to take part in the public worship of the sect, and if any of them is wrongfully prevented from so doing, he is entitled to seek from <ORG> such remedies as they can afford him." In the case reported in <NAME> and <NAME>. v. <NAME> and Ors. I.L.R. 5 B., 80, the court refused to entertain a suit by the committee of management of a Hindu temple to compel the hereditary priests of the temple to take out certain ornaments from the treasury and place them upon the god on such days as the committee might appoint on the ground that no question of the right to property or to an office was involved, whilst in the case reported in Narayan Vithe Parah v. Krishnaji Sadashiv I.L.R. 10 B. 233 the court declined to take cognizance of a suit in which the plaintiffs set up the right to be the first to worship the village deity at certain festivals, and in the case reported in <CITATION> . 7 M. 91 this court refused to entertain a suit in which the plaintiffs set up a right based on usage to receive before others sacred ashes, &c., in certain pagodas on certain days.

10. On the other hand <ORG> has held, <CITATION> . 7 B. 323 that a suit by certain members of a particular caste in which the plaintiffs claimed that the members of their caste, in common with certain other castes, possessed the exclusive right of entry and worship in the sanctuary of a temple, was within the cognizance oil the Civil. Courts. The right set up in this case was the exclusive right of certain castes to worship in the sanctuary of a temple. No question of ritual was involved. The usage upon which the court adjudicated was an alleged caste usage. In the present case the right set up was not based upon caste usage and was not relied upon as a caste privilege. It was a right set by certain individuals which they claimed to enjoy not as members of the caste but as residents in a particular street.

11. In a case reported, <CITATION> . 3 C., 390, it was held that a plaint which alleged a refusal to deliver up an idol whereby the person demanding it was prevented from performing his turn of worship on a specified date, disclosed a cause of action. The point was taken in the settlement of issues and does not seem to have been fully argued. The case is very shortly reported, but it would appear that by the conduct of the defendants, the plaintiffs were wholly deprived of their turn of worship. The present case cannot be put higher than that the plaintiffs have been deprived of certain facilities for worship which they had previously enjoyed.

12. In an unreported case decided by this court to which my learned colleague referred (Appeal No. 83 of 1895), the plaintiff had brought the right to certain dignities and emoluments and the contention that the honours and dignities were of a religious nature of which <ORG> could not take cognizance was overruled. In that case some of the rights claimed by the plaintiff undoubtedly possessed a money value. Others did not. But it was proved that since 1810 the latter had always been treated as a part and parcel of the same miras, and they appeared to be rights which were inseparable from the other rights. They had always been classed together, and they had been mortgaged, bought and sold together, and the courts were of opinion that the rights appertaining to the miras were one and indivisible. This being the ground of the decision, the case in no way supports the proposition that <ORG> are competent to adjudicate upon a claim such as that set up in the present case.

13. The appellants' Counsel relived strongly on the judgment of <ORG> in <NAME> v. Cure &c de Montrial L.R. 6. P.C. 157 and contended that the proposition laid down by <ORG> with reference to <ORG> in Canada was applicable to the present case. The proposition is as follows: * * * even if this church were to be regarded merely as a private and voluntary religious society resting only upon a consensual basis, Courts of Justice are still bound, when due complaint is made that a member of the society has been injured as to his rights in any matter of a mixed spiritual and temporal character, to enquire into laws or rules of the tribunal or authority which has inflicted the alleged injury."

14. I do not think this proposition, which is very general in its terms and which was advanced in relation to ecclesiastical disputes in a Christian country, ought to be applied so as to affect the rules which the courts of this chantry have laid down with reference to the interference by <ORG> in relation to disputes connected with religious ceremonies or observances in this country.

15. To my mind the balance of authority supports the view that the present suit is not cognizable by a civil tribunal.

16. I think the suit was rightly dismissed and that this appeal ought to be dismissed with costs.

<NAME>, J.

17. The plaintiffs are residents of Krisrnaswami Covil Street, Black Town, and their case is that on all occasions but one when the goddess of the Kaliarnman Covil is carried out in procession, it has been the invariable practice for the idol to be taken through their street and stoppages made there in order that they may worship it. They allege that last year for the first time the defendant, who is the Dharmakartha of the temple, broke the practice by not taking the procession through their street, and they prayed for a mandatory injunction to compel him to do so in future and for damages. The defendant's answer was that he was not bound by the practice, and that he took the procession through a longer route which prevented its going through the plaintiffs' street in order to benefit more worshippers and thereby the temple. The learned Judge who tried the case held that the practice did not constitute a valid, custom binding on the temple authorities and dismissed the suit.

18. The plaintiffs appeal. Their evidence shows, and the defendant does not deny that the alleged practice has existed from time immemorial, and that, though in the years 1874 to 1878 the goddess was not taken in procession at all owing to temple disputes, whenever it has been taken, the customary route through the plaintiffs' street has never been departed from till last year. The plaintiffs accordingly claim to have established a right to worship, the goddess at their own door-steps on these occasions. Each plaintiff sets up an individual right as well as the collective right of the residents of the street generally, which observation I make in order to dispose of the objection taken to the suit with reference to Sections 30 and 539 of the C.P.C. The only questions that remain for determination are: (1) Whether the plaintiffs can sue in <ORG> to establish the right they set up, and (2) if so, whether they have established the right.

19. On the first question the right of the plaintiffs to worship the goddess is not disputed and that this right of public worship, if infringed, is remediable in a civil court was held in <NAME> v. Pandaveswara I.L.R. 6 M. 151, where a dancing girl's offerings to the (sic) were rejected by the priest. In Subbaraya Gurukal v. Chellappa Mudali I.L.R. 4 M. 315 a case which in its facts is on all fours with this, it was held that a Hindu idol is a "property," and the right to deal with such property is a right cognizable by <ORG>. A similar view was taken by Mr. Justice <NAME> in <CITATION> . 3 C. 390. The right to worship an idol at a particular place or standpoint was recognized as enforceable by a civil court in the cases reported at <CITATION> . 7 B. 323 and Venkatachalapati v. Subbarayadu I.L.R. 13 M. 293. No decision to the contrary were cited at the <ORG>. All the cases in which it has been held that the civil courts had no jurisdiction were cases in which only the mode of worship was in question, that is, questions relating to the ritual or to precedence and other mere dignities or honours claimed in the exercise of the right of worship. So that I take it there can be no doubt of the plaintiffs' right of suit in this court.

20. The other question is whether they have established the right to worship the goddess in their own street in front of their houses where it was taken out in procession. The fact that they have invariably done so hitherto within living memory is itself sufficient in my opinion, to establish the right. <NAME> reigns supreme in this country, and it lies on any one who wishes to change the mamool to show good and sufficient reason for so doing especially in a matter affecting the route of an idol's procession, disputes regarding which are a fruitful source of rioting and bloodshed. The defendant has not shown that he had any authority to divert the idol's procession from its ordinary route. The plea that more profit is got by taking the goddess elsewhere is a plea of expediency which cannot avail against the vested right of the plaintiffs. You cannot rob Peter to pay Paul. There can, however, be no objection to the defendant taking the idol to new places so long as he takes it to the old ones. I should therefore, reverse the decree appealed against and issue a mandatory injunction to the defendant as prayed for by the plaintiffs, viz., that whenever the goddess of the Kaliamman Covil is taken out in procession, the procession must pass through Krisrnaswami Covil Street, except on the three days, 7th, 8th and 9th of the Brahmotsavam festival, which days ought admittedly to be excluded. I would also cast the defendant in nominal damages of Rs. 20 and direct him to pay the plaintiffs' costs throughout.

[Under Section 33 of the Letters Patent the appeal is dismissed with costs].


JUDGMENT <NAME>, J.

1. This is an appeal by special leave on behalf of two brothers, <NAME> and <NAME>, who have been convicted under Section 302, Penal Code and sentenced to transportation for life by the Second Additional Sessions Judge of Ferozepore. Their convictions and sentences have been upheld by <ORG> of <ORG> by its judgment dated 30-6-1954.

The petitioners had been placed on trial along with two others, named <NAME> and <NAME>. All these four had Been convicted and sentenced, as stated above, by the learned Sessions Judge; but on appeal, <ORG> gave <NAME> and <NAME> the benefit of the doubt and acquitted them.

2. The prosecution case, shortly stated, is that on 2-9-1953 the two petitioners along with the other two accused, who were acquitted as aforesaid by <ORG>, left their village called Sanghu Dhawan, all armed with 'gandasas' and were seen proceeding towards Muktsar town, about three miles away.

A short time after, <NAME> accompanied by his son, <NAME> (P. W. 2) and <NAME> (P.W. 4), who also belong to the same village, left for Muktsar to purchase some chemical manure on a permit by the agriculture department. <NAME> proceeded ahead and the other two were behind him at a short distance. As soon as <NAME> reached a certain bridge on the way to Muktsar, about a mile from the village, the four accused, who were lying in ambush in a neighbouring 'bajra' field, came out of the field and attacked him.

<NAME>, the first appellant, opened the attack with a 'gandasa' blow on his head. He was followed by <NAME>, accused, who dealt some 'gandasa' blows on his leg. <NAME> fell down and all the four accused were said to have attacked him with 'gandasas' causing as many as 27 injuries on his person. <NAME>'s two companions, <NAME> and <NAME> aforesaid, raised an alarm but were helpless spectators, who being unarmed, could not venture to come to his rescue.

Further it was stated by the prosecution witnesses aforesaid that while there was life still left in <NAME>, accused <NAME> chopped off their victim's head from the body just above the lower jaw and wrapped the head along with the turban in the 'chaddar' of the deceased.

<NAME> and <NAME> (P. Ws.), who were returning from Muktsar, claimed to have seen the last part of the prosecution case, namely, that the four accused were seen making away with the head wrapped in a piece of cloth. <NAME> (P. W. 2) hastened to the police station and lodged the first information report at 5 P. M. the same afternoon, the place of occurrence being noted as a mile and a half towards the east of the police station.

The time of the occurrence is not specified except saying that it was in the afternoon. In the first information report all the four accused persons were named and said to have conspired to kill <NAME>. The prosecution version as laid in the first information report is substantially as stated above. As regards the motive of the crime, it is said in the first information report "All the four culprits suspected my father of his having given a secret information against them".

3. At the trial <NAME> (P. W. 2) and <NAME> (P. W. 4) deposed as eye-witnesses to the occurrence from beginning to end, whereas <NAME> (P.W. 6) and <NAME> (P. W. 7) deposed to the last part of the prosecution case as having witnessed the occurrence on hearing an alarm from about 100 to 150 yards. They claim to have seen all the four accused armed with 'gandasas' and <NAME> wrapping the head in a piece of cloth.

4. The defence of the appellants was a denial of their participation in the occurrence and they explained their implication by alleging that they were on inimical terms with the family of the deceased <NAME>. The appellant, <NAME>, set up a case of 'alibi' which may best be stated in his own words in his statement under Section 342 , Criminal P. C. before the Magistrate who held the inquiry. He said:

"I am a member of <ORG> panchayat. I along with other members of our panchayat came to Muktsar that day at 8 a.m. Chief Minister was here that day. I left Muktsar that day after the oath taking ceremony etc., at about 2-30 p.m. When I reached the local cinema it started raining.

Head Constable <NAME> and <NAME> of Chak Bir Sarkar met me there. I remained there for about 1-1/2 hours and then went to village, when rain stopped. I was accompanied by <NAME>, member village panchayat; <NAME>, <NAME> & <NAME> were coming to the thana to make the report. <NAME>, member Panchayat enquired what the matter was. They replied that their father had been killed by an unknown person. Shortly afterwards, <NAME>, M.L.A. of Bir Sarkar met us. Then we went to the village. I am innocent".

5. It is convenient here to dispose of this particular defence of the accused to which our attention was invited by the learned counsel for the appellants. He urged that this was a very bold defence. It was taken at an early stage of the inquiry against the appellants and it could easily have been verified with reference to the official records.

It has been admitted in the evidence led on behalf of the prosecution that there was a function in the forenoon of the date of the occurrence at which the Chief Minister was present and the members of the <ORG> took their oath of office. According to the evidence, this function came to an end at about 12-30 p.m. The burden of proving the 'alibi' undoubtedly lay on the appellant <NAME>. It is true, as urged by his counsel, that this was a bold defence, but the burden to establish that defence, however bold it may have been, lay on the accused.

No attempt was made to call any evidence, oral or documentary, to prove that the appellant <NAME> was present at the ceremony and that it came to an end at about 2-30 p.m. as alleged by him. If that defence had been made out, certainly the appellant <NAME> would have been entitled to an acquittal because the occurrence could not have taken place much later than 2-30 p.m., though the exact time of the occurrence is not known.

But the indication in the evidence is that it took place at about 3 p.m. As the burden of proving this special defence of alibi has not been discharged, appellant <NAME>'s case stands on the same footing as that of the other appellant.

6. But even so, the burden of proving the case against the appellants was on the prosecution irrespective of whether or not the accused have made out a plausible defence. The case for the prosecution against the appellants rests on the testimony, as already indicated, of P. Ws. 2 and 4 who had accompanied the deceased from the village on the journey to Muktsar and P. Ws. 6 and 7 who were on their way back from Muktsar and were attracted to the scene of the occurrence by the alarm raised by those two witnesses.

The courts below have discussed the evidence of these four witnesses in great detail and have found it reliable notwithstanding the fact that <NAME> (P. W. 2), <NAME> (P. W. 6) and <NAME> (P. W.7) are close relations of the deceased. On the face of it, therefore, there is no question of law involved and no grounds for interference have been made out in special appeal.

7. But it has been argued by the learned counsel for the appellants with his usual vehemence that <ORG> did not act upon the testimony of those four witnesses in so far as it acquitted two of four accused, namely, <NAME> and <NAME>. The reasons for the acquittal of those two persons may be stated in the words of <ORG> as follows:--

"In regard to the complicity of <NAME> and <NAME>, I have some doubt and I think that they must be given the benefit of the doubt. Neither <NAME> nor <NAME> had any motive to murder <NAME>. In the first information report definite part was assigned to <NAME> and <NAME> inasmuch as it was said that <NAME> and <NAME> inflicted gandasa blows from right side while <NAME> was lying down and cut off major portion of his head from the body.

<NAME> who made the first information report stated at the trial that it was not correct that <NAME> and <NAME> accused had cut off the head of his father. <NAME>, P. W. 4, gave evidence that <NAME> chopped off the head of <NAME>.

No particular injuries are ascribed to <NAME> and <NAME>. <NAME>, P. W. 6, and <NAME>, P. W. 7, deposed that they saw the four accused from a distance of 60 or 70 karams standing near the dead body of <NAME> and that they had gandasas with them. <NAME> stated that the four accused walked away towards Ude Karan. In my opinion, the evidence given by <NAME>, P. W. 6, and <NAME>, P. W. 7, does, not necessarily connect <NAME> and <NAME> with the crime".

8. In this connection reliance was placed on behalf of the appellants on the recent decision of this Court dated 13-9-1955 (unreported) in the case of <NAME> v. State of Punjab (Since ). In that case two persons were placed on trial on a charge of murder and convicted by the trial court.

On appeal, <ORG> acquitted one of them giving him the benefit of the doubt but maintained the conviction of the other, as also the sentence of death passed upon him. This Court found that the positive evidence against the convicted person was not stronger than or any different from the evidence led against the acquitted person. But that was not the sole ground of the decision.

This Court further observed that the direct testimony against the accused persons was not free from blemish, in so far as it appeared from the evidence that the first person who originated the theory of the complicity of the accused in that case was almost a blind: person who could not see things, particularly at the dead of the night, and that the other witnesses who turned up at the alarm had readily accepted the opinion of the first witness that it was the condemned person who had been responsible for the murderous assault.

This Court therefore felt a reasonable doubt as to the correctness of the oral testimony and had consequently to give the benefit of the doubt to the accused.

9. The case in hand is similar to the case reported as <CITATION> in so far as it was found in that case, as we are inclined to hold in this case, that the acquittal of the other two accused by <ORG> may not have been entirely correct.

Reference to that reported case is only by way of illustration and not by way of an appeal to precedent, because on the facts no two cases can be similar. Each case has its own peculiar facts and it is therefore always risky to appeal to precedents on questions of fact. The highest that can be or has Been said on behalf of the appellants in this case is that two of the four accused have been acquitted, though the evidence against them, so far as the direct testimony went, was the same as against the appellants also; but it does not follow as a necessary corollary that because the other two accused have been acquitted by <ORG> the appellants also must be similarly acquitted.

In the present case <ORG> differentiated the case of the two appellants from that of the other two accused whom it acquitted chiefly on the ground that whereas there was some evidence of motive against the two appellants, there was no such evidence against those two acquitted persons. On the question of motive the trial court held that it had not been established that the, deceased <NAME> had given information to the police leading to the recovery of a pistol from <NAME>, the first appellant, and his conviction for an offence under the Arms Act .

It had only been established that <NAME> (P. W. 8), brother of the deceased <NAME>, had given evidence against the accused in the Arms Act case. If that was the only case of animosity between the two families, the appellants could have greater reasons to be offended against <NAME> himself. But it has repeatedly been pointed out by this Court that where the positive evidence against the accused is clear, cogent and reliable, the question of motive is of no importance. As regards the question who gave which blows to the deceased, the prosecution evidence was that after <NAME> fell from the blows of the two appellants, all the four accused gave gandasa blows to the fallen man.

Be that as it may, we are no more concerned with the case against those two accused persons who have been acquitted by <ORG>; but so far as the appellants are concerned, the evidence of the four eyewitnesses referred to above is consistent and has not been shaken in cross-examination. That evidence has been relied upon by the courts below and we do not see any sufficient reasons to go behind that finding. It is true that three out of those four witnesses are closely related to the deceased <NAME>.

But that, it has again been repeatedly held, is no ground for not acting upon that testimony if it is otherwise reliable in the sense that the witnesses were competent witnesses who could be expected to be near about the place of occurrence and could have seen what happened that afternoon. We need not notice the other arguments sought to be advanced in this <ORG> bearing upon the probabilities of the case because those are all questions of fact which have been adverted to and discussed by the courts below.

10. In our opinion, no grounds have been made out for interference. The appeal is accordingly dismissed.


PETITIONER: <NAME> AND <NAME>. Vs. RESPONDENT:

<ORG> MUNICIPAL COUNCIL AND ORS.

DATE OF JUDGMENT13/09/1990 BENCH:

VENKATACHALLIAH, M.N. (J) BENCH:

VENKATACHALLIAH, M.N. (J) OJHA, N.D. (J) CITATION:

1991 AIR 1153 1990 SCR Supl. (3) 20 1991 SCC (3) 91 1991 SCALE (1)378 ACT:

Constitution of India, 1950: Articles 14 and 298--State Instrumentality--<ORG> entering into contract with private developer for construction of Commercial Com- plex on self financing basis--Adoption of such an unconven- tional technique as a policy option--Validity of. Article 226-- Resort to--Contractual transaction of Government or its instrumentality--Presence public law element--Essential for invoking Judicial Review. Municipalities: Maharashtra Municipalities Act, 1965: Sections 92 & 272(1)--Municipal Market--Disposal of occupan- cy rights-Construction of Commercial Complex--Private de- veloper to undertake on self financing basis--Giving admin- istrative building to <ORG> free of cost--Shops to be given to allottees--Liberty to dispose of the remain- ing accommodation to cover financial outlays and project

---Whether valid.

Administrative Law: Judicial Review--Policy decision--Government or its instrumentality--Whether free to evolve and adopt any method for executing of a Project--Such decisions--whether open to Judicial Review. Test of 'Reasonableness'--To distinguish between proper use and improper use of power--Applicability of the test depends upon context.

Delegation of power----Statutory function under Section 272 of the Maharashtra Municipalities Act, 1965 Occupancy rights--Powers to substitute occupiers in its own place by developer--Whether permissible.

Interpretation of Statutes: Use of same word/phrase or concept in different laws--Distinction in meaning and usage--Need for.

Words & Phrases.' 'Reasonableness'--'Reasonable man'--Meaning of.

HEADNOTE:

The respondent <ORG> received by way of gift certain lands from one 'L' and the said lands were used by <ORG> as a cotton market and wholesale fruit and vegetables market. <ORG>, in order to put the land to a better and more profitable use, persuaded <ORG> to yield up possession. However, since the gift stipulated certain conditions regarding the user, <ORG> ap- proached the heirs of the donor for amending the terms of the gift, and the heirs bargained for and secured a benefit that five shops be given to them free of cost in the pro- posed commercial complex. The entire project of constructing the Administrative building, an adjacent structure for vegetable market and a commercial complex was to be executed by a developer at his own expense. The estimated/financial outlay was about Rs.11 crores. It was contemplated that the developer was to hand over the Administrative building free of cost to the <ORG> and the vegetable market to the allottees and the five shops to the heirs of the donee of the land. Thereafter the developer would be entitled to dispose of the occupancy rights in respect of the rest of the accommodation in the commercial complex and retain the promia received therefrom to cover the financial outlays and profit thereon. The occupiers to whom allotments were made as also the occupiers inducted by the developer were to pay rents to <ORG> for 50 years. Tenders were issued for the project, and after scrutiny of the tenders submitted by five developers, the tender of <ORG> was accepted by <ORG>, and a formal agreement was entered into between the <ORG> and <ORG>.

The appellants, residents of the area petitioned to the Collector to suspend the Resolutions of the Council under- taking the said project and the agreement entered with Respondent No. 6, on the grounds that the proposed transac- tion amounted to a lease for 50 years which was prohibited under Section 92 of the Maharashtra Municipalities Act, 1956; that sanction of <ORG> was not obtained; that an impermissible encumbrance would be created on the Councils property in favour of the developer and that the intended user violated the original terms of the gift. On the said petition, the Collector passed orders suspending the Resolutions. On revision, the Minister stayed the opera- tion of the Collector's order.

Meanwhile, a Writ Petition was filed before <ORG>, assailing the said Resolutions. Another Writ Petition was filed challenging the Minister's orders staying the order of the Collector. Both the Writ Petitions were heard together. The main contention of the Writ Petitioners was that the financial estimates of the project were made grossly under-estimating the probable receipts by way of premia for the grant of occupancy rights with the intention of giving an opportunity for unjust enrichment to Respondent No. 6. <ORG> directed that occupancy rights in regard to the shops at the disposal of the developer tenders be called from the public, so that the difference between what was taken into account in the esti- mate and what was actually secured might go to the benefit of the Municipality. Accordingly, advertisement were issued, but it did not evoke any favourable response from the pub- lic. The matter was listed again before <ORG>. It was held that <ORG>'s earlier order was self-execu- tory, and the Writ Petitions were dismissed. Review Petition was also dismissed. Another Writ Petition challenging the advertisement issued pursuant to <ORG> earlier order was also dismissed.

The Special Leave Petitions fried against the above-said orders of <ORG>, were dismissed by this Court with the observations that it was open to the petitioners to move the Minister for final disposal and the Minister would expeditiously dispose of the matter taking into considera- tion whether the scheme was in conformity with the statutory provisions. The Minister disposed of the Revision Applica- tion recording his findings against the appellants. There- upon, the appellants filed a fresh Writ Petition before <ORG> challenging the Minister's orders. <ORG> declined to interfere. Aggrieved by <ORG>'s order, appellate preferred the present appeal by special leave. It was contended on behalf of the appellants that the scheme of financing the project was not, as a matter of policy, open and permissible to a Governmental authority; that the <ORG> authority could have put up the construc- tion itself departmentally or awarded the execution of the whole project to a building contractor; that the method of financing and the execution of the project are, beyond the powers of the <ORG> authority under the Act; that the terms of the agreement with the developer that the latter be at liberty to dispose of the occupancy rights in the commer- cial complex in such manner and on such terms as it may choose would amount to an impermissible delegation of the statutory functions of <ORG>, under Section 272 of the Maharashtra <ORG>ities Act; that the project, in effect amounted to disposal of <ORG> property by way of a long term lease with rights of sub-letting in favour of the developer and hence violative of Section 92 of the Act; and that the scheme was arbitrary, unreasonable and viola- tive of Article 14 of the Constitution. It was further con-

tended that the project was patently intended to provide for an unjust enrichment of Respondent No. 6 at public expense. On behalf of the Respondent it was contended that the increasing revenue expenditure and other financial commit- ments rendered it impossible for <ORG> to set apart the financial inputs required for the project; that in the management of the transaction regarding disposal of occupancy rights and prompt mobilisation of funds, the deficiencies and limitations of the bureaucratic machinery should not be ignored in assessing the value and utility of the alternatives; that all the said Resolutions in regard to the Project were passed unanimously which lend credance to the propriety and wisdom of the measure and its reasonable- ness; that the estimates and calculations on which the scheme was worked out by <ORG> would show that the developer had no opportunity of making any run-away profits or exploitative gains.

Dismissing the appeal, this <ORG>, HELD: 1. A project, otherwise legal, does not become any the less permissible by reason alone that the local authori- ty, instead of executing the project itself, had entered into an agreement with a developer for its financing and execution. The question is not whether it is un-conventional by the standard of the extant practices, but whether there was something in the law rendering it impermissible. No doubt there is a degree of public accountability in all governmental enterprises. But, the present question is one of the extent and scope of judicial review over such mat- ters. With the expansion of the <ORG>'s presence in. the field of trade and commerce and of the range of economic and commercial enterprises of government and its instrumentali- ties there is an increasing dimension to governmental con- cern for stimulating efficiency, keeping costs down, im- proved management methods, prevention of time and cost over-runs in projects, balancing of costs against time- scales, quality-control, cost-benefit ratios. etc. In search of these values it might become necessary to adopt appropri- ate techniques of management of projects with concommitant economic expediencies. There are essentially matters of economic policy with lack adjudicative disposition, unless they violate constitutional or legal limits on power or have demonstrable pejorative environmental implications, or if they amount to clear abuse of power. This again is the judicial recognition of administrator's right to trial and error, as long as both trial and error are bona fide and within the limits of authority. [35C- <CITATION> ,  1 SCC 100; relied on.

<CITATION> - ty,  3 SCR 1014; <NAME> v. State of J JUDGMENT:

<ORG> v. <NAME>, 285 US 262 Dissenting opinion of <NAME>; Education Secretary v. Tameside B.C., [1977] AC 1014; referred to, "The Purpose and Scope of Judicial Review" by Sir <NAME> is "Judicial Review of Administrative Action in the 1980s", <ORG>; referred to.

2. In the ever increasing tempo of urban life and the emerging stresses and strains of planning, wide range of policy options not inconsistent with the objectives of the statute should be held permissible. In the context of ex- panding exigencies of urban planning it will be difficult for the court to say that a particular policy option was better than another. The project is not ultra vires of the powers of <ORG>, and hence there is no justification for quashing the Resolution of <ORG>. [36G] Policy making Paradigms in Administrative Law" by <NAME> in <ORG>, vol. 95 p. 393; referred to.

3. In the instant case, it is possible to fit the power exercised by the Municipal authority into Section 272(1) of the Maharashtra Municipalities Act and hence there is no reason why the provision be interpreted unduly restrictively to exclude such enterprise. [40E]

4. It has not been established that the essential ele- ments of the transaction are such that Section 92 of the Act is violated. It would, indeed be unduly restrictive of the statutory powers of the local authority if a provision enabling the establishment of markets and disposal of occu- pancy-rights therein are hedged in by restrictions not found in the statute. The developer who was authorised to induct occupiers in respect of the area earmarked for him merely exercised, with the consent of <ORG> a power to substitute an Occupier in his own place. This is not impermissible when it is with the express consent of <ORG>. [40H; 41A-B] 5.1 Some phrases which pass from one branch of law to another--as did the expression 'void' and 'voidable' from private law areas to public law situations-carry over with them meanings that may be inapposite in the changed context. Some such thing has happened to the words "Reasonable", "Reasonableness" etc. Different contexts in which the opera- tion of "Reasonableness" as test of validity must be kept distinguished. The administrative law test of 'reasonable- ness' as the touch-stone of validity of the Resolution in the instant case is different from the test of the 'reasona- ble man' familiar to the law of torts, whom English Law figuratively identifies as the "man on the clapham omnibus". In the latter case the standards of the 'reasonable-man', to the extent such a 'reasonable man' is court's creation, is a mere transferred epithet. Yet another area of reasonableness which must be distinguished is the constitutional standards of 'reasonableness' of the restrictions on the fundamental rights of which <ORG> is the arbiter. [42F-G; 43A-B] 5.2. The 'reasonableness' in administrative law must distinguish between proper and improper use of power. [44D] Davis Contractors v. Fareham U.D.C., [1956] 2 AH ER 145; <ORG> v. <ORG>, [1948] 1 KB 223; Nottinghamshire County Coun- cil v. Secretary of State for Environment, [1986] AC 240; <NAME> v. <ORG>, 318 US 54; Chief Constable v. <NAME>, [1982] 3 All ER 141; referred to. Administrative Law, by <NAME>, 6th Edn., pp. 407, 408; Legal Control of Government, by <NAME> and <NAME>, p. 253; referred to.

6. While it is true that principles of judicial review apply to the exercise by a government body of its contractu- al powers, the inherent limitations on the scope of the inquiry are themselves a part of those principles. In a matter even as between the parties, there must be shown a public law element to the contractual decision before judi- cial review is invoked. In the present case the material placed before the <ORG> fails far short of what the law requires to justify interference. [46F]

7. There is no merit in the contention that the Project Scheme was tailored to suit Respondent No. 6 alone or that the project as put to tender did not admit of tenders on fixed comparable parameters. No other tenderer expressed any grievance. The tenders were such that the tenderer could identify the terms which form the basis of comparative evaluation. The charge of arbi- trariness cannot be upheld. [46G-H; 47A]

8. To condemn the Municipal authority's decision, other- wise valid, on the ground alone that the developer is likely to resort to transactions of unaccounted money would, as a judicial remedy, be plainly unthinkable. [47E] &


PETITIONER: INDUSTRIAL CREDIT AND INVESTMENT CORPORATION OF INDIA LTD. Vs. RESPONDENT: <ORG>. DATE OF JUDGMENT: 22/02/1996 BENCH: HANSARIA B.L. (J) BENCH: HANSARIA B.L. (J) AHMADI A.M. (CJ) CITATION: 1996 SCC (4) 165 JT 1996 (5) 405 1996 SCALE (2)774 ACT: HEADNOTE: JUDGMENT:

[With T.C. (C) Nos. 44-46/91 & 1/92, C.A.Nos. 3820-22, 4253 & 4256 of 1996 (arising out of SLP(C) Nos. 13235/91, 14446/91, 15026/91, 10101/91, and 11055/95)] J U D G M E N T HANSARIA, J.

The extent of right cf secured creditors to realize their debts from the assets of a company which is under winding-up or has been wound up, by approaching fora other than the company court, is required to be spelt out in these appeals. We have also been called upon to decide as to then a pending suit or proceeding relating to realization of the debts by such a creditor should be transferred to itself by a company court seized with the winding-up proceeding.

2. The foundational premise of the aforesaid points is that position by now that a secured creditor stands outside the winding-up proceeding and under the law he can proceed to realize his security without the leave of the winding-up court, if by the time he initiated the action the company has not beer wound up. This view has been holding field ever since a three-Judge bench decision of this Court in <CITATION> , 1955 (2) SCR 374. As this legal position has not been assailed by any of the parties, we need not advert to the reasons which led this Court in <NAME>'s case to hold as above. Despite this being the legal position, there were some provisions in the Indian Companies Act , 1913, which enactment preceded the present Companies Act , 1956 (hereinafter the 'Act') in which also a parallel provisions find place, which put some restrictions on the aforesaid power.

3 It would be profitable to note these provisions of the Act at the threshold itself. These are sections 446 , 529(1) and(2), 529A and 537, reading as below :

"446 (1) When a winding up order has been made or the Official Liquidator has been appointed as provisional liquidator, no suit or other legal proceeding shall be commenced. or if pending at the date of the winding up order, shall be proceeded with, against the company, except by leave of the <ORG> and subject to such terms as the <ORG> may impose.

(2) The Court which is winding up the company shall, notwithstanding anything contained in any other law for the time being in force, have jurisdiction to entertain, or dispose of-

(a) any suit or proceeding by or against the company;

(b) any claim made by or against the company (including claims) by or against any of its branches in India);

(c) any application made under section 391 by or in respect of the company; (d) any question of priorities or any other question whatsoever, whether of law or fact, which may relate to or arise in course of the winding up of the company;

whether such suit or proceeding has been instituted, or is instituted, or such claim or question has arisen or arises or such application has been made or is made before or after the order for the winding up of the company, or before or after the commencement of the Companies (Amendment) Act , 1960.

(3) Any suit or proceeding by or against the company which is pending in any <ORG> other than that in which the winding up of the company is proceeding may, notwithstanding anything contained in any other law for the time being in force, be transferred to and disposed of by that <ORG>. (4) Nothing in sub-section (1) or sub section (3) shall apply to any proceeding pending in appeal before the Supreme <ORG> or a High <ORG>.

529. (1) In the winding up of an insolvent company, the same rules shall prevail and be observed with regard to-

(a) debts provable ;

(b) the valuation of annuities and future and contingent liabilities; and

(c) the respective rights of secured and unsecured and unsecured creditors: as are in force for the time being under the law of insolvency with respect to the estates of persons adjudged insolvent:

Provided that the security of every secured creditor shall be deemed to be subject to a pari passu charge in favour of the workmen to the extent of the workmen's portion therein, and. where a secured creditor, instead of relinquishing his security and proving his debt, opts to realize his security,-

(a) the liquidator shall be entitled to represent the workmen and enforce such charge;

(b) any amount realized by the liquidator by way of enforcement of such charge shall by applied ratably for the discharge of workmen's dues; and

(c) so much of the debt due to such secured creditor as could not be realized by him by virtue of the foregoing provisions of this proviso or the amount of the workmen's portion in his security, whichever is less. shall rank pari passu with the workmen's dues for the purposes of section 529A . (2) All persons who in any such case would be entitled to prove for and receive dividends out of the assets of the company, may come in under the winding up, and make such claims against the company as they respectively are entitled to make by virtue of this section: Provided that it a secured creditor instead of relinquishing his security and proving for his debt proceeds to realize his security, he shall be liable to pay (his portion of the expenses incurred by the liquidator (including a provisional liquidator, if any) for the preservation of the security before its realization by the secured creditor).

Explanation : For the purposes of this proviso, the portion of expenses incurred by the liquidator for the preservation of a security which the secured creditor shall be liable to pay shall be the whole of the expensed less an amount which bears to such expenses the same portion as the workmen's portion in relation to the security bears to the value of the security.

(3) * * * * * * * * * 529A. (1) Notwithstanding anything contained in any other provision of this Act or any other law for the time being in force, in the winding up of a company-

(a) workmen's dues; and

(b) debts due to secured creditors to the extent such debts rank under clause (c) of the proviso to sub-section (1) of section 529 pari passu with dues, shall be paid in priority to all other debts.

(2) The debts payable under clause

(a) and clause (b) of sub-section (1) shall be paid in full, unless the assets are insufficient to meet them, in which case they shall abate in equal proportions.

537. (1) Where any company is being wound up by or supervision of the Court-

(a) any attachment, distress or execution put in force, without leave of the <ORG>, against the estate or effects of the company, after the commencement of the winding up; or

(b) any sale held without leave of the <ORG>, of any of the properties or effects of the company after such commencement; shall be void.

(2) Nothing in this section applies to any proceedings for the recovery of any tax or impost or any dues payable to the Government."

4. A combined reading of the aforesaid provisions leads to the following results :

(i) A winding-up court has jurisdiction, inter alia, to entertain or dispose of any suit or proceeding by or against the company, even if such suit or proceeding had been instituted before an order for winding-up had been made. This apart, the winding-up court has jurisdiction to transfer such a suit or proceeding to itself and dispose of the same. These follow from sub-sections (2) and (3) of section 446 .

(ii) When a winding-up order has been made or the official liquidator has been appointed as provisional liquidator, no suit or other legal proceeding, even if pending at the date of the winding-up order, can proceed against the company, except by Leave of the Company Court vide sub-section (1) of section 446 .

(iii) Any sale held without the Leave of the winding-up court pursuant to order of a civil court on it being approached by a secured creditor to realise its debt will not ipso facto be void, in view of the holding in <NAME>'s case that section 537 , dealing with voidness of sale, operates when the sale is pursuant to attachment of company court. This, however, would be the position where a company has not been wound up, but is in the process of being wound up.

5. None of the parties has assailed the aforesaid propositions of law as well. The real bone of contention is as to when (i) leave of the winding-up court should be granted to a secured creditor to proceed with the suit after an order of winding-up has been made; and (ii) when should a winding-up court transfer to itself any suit or proceeding by or against the company during the pendency of the winding-up proceeding.

6. The aforesaid questions arise because a secured creditor who has initiated a suit or proceeding in a civil court is interested in realization of his debt only, whereas the company court looks after the interest of all the creditors; so too. the workmen's dues, which rank pari passu with debts due to secured creditors. This is brought home not only by section 529A , which was inserted by the Company (Amendment) Act , 1985, but also by the proviso to section (1) of section 529 inserted by the same Amendment Act . The winding-up court does these acts through a liquidator, who has been given wide powers by section 457 of the Act. As against this, a receiver appointed by a civil court on being approached by secured creditor would basically look after the interest of that creditor, whose interest may in many cases he in conflict with that of liquidator, as was acknowledged in In re Karamelli & Barnett, Limited. 1917 (1) CH 203 We feel no difficulty in stating that in case of such conflict, the interest of liquidator has to receive precedence over that of the receiver inasmuch as the former looks after the interest of a large segment of creditors alongwith that of workmen, whereas the latter confined his concern to the interest of the secured creditor on whose approach the receiver had bean appointed. This view cannot also be, and has indeed not been, contested by the learned counsel appearing for the appellants.

7. The real controversy is as to when a winding-up court should get transferred to itself a pending proceeding initiated by secured creditor: and when a winding-up court should grant leave to the secured creditor to pursue his remedy in the civil court, despite winding-up order having been passed. <NAME> brought to our notice. on the first aspect of the controversy, a decision of two-Judge bench decision of this Court in <CITATION> , 1994 (4) SCC 159. It was held therein that the aim of section 446 is to safeguard the assets of the company against wasteful or expensive litigation as for as matters which could be expeditiously and cheaply decided by the company court. It was also observed that while granting leave under this section the court always takes into consideration whether the company is likely to be exposed to unnecessary litigation and cost.

8. In this context. lt would be apposite and useful to note what was started by a three-Judge bench in <CITATION> , 1984 (4) SCC which has traced the historical evolution as well as the present setting of Section 446(2) . A need for such a provision was felt because section 171 of the predecessor Act had only provided for stay of suits and proceeding pending at the commencement of winding-up proceeding, alongwith the embargo against the commencement of any suit or other legal proceeding, against the company except by the leave of the court. That provision, with little modification, was re- enacted in sub-section (1) of section 446 . There was thus no specific provision conferring jurisdiction to the court winding-up the company analogous to the one conferred by sub-Section (2), which was introduced to enlarge the jurisdiction of the winding-up court so as to facilitate the disposal of winding-up proceeding. This sub-section, as originally enacted, did not meet with the requirement fully, with the result that the <ORG> appointed for examining comprehensive amendment to the Companies Act recommended that "a suit by or against a company in winding-up should notwithstanding any provision in law for the time being be instituted in the court in which the winding-up proceedings are pending". The <ORG> made this recommendation having noticed that on winding-up order being made and the official liquidator being appointed, he has to take into his custody company property as required by section 456 . Then, secting 457 confers power on the liquidator to sell the properties of the company and to realise the assets, The <ORG> felt that at the stage when winding-up order is made, the company may as well have subsisting claims and to realise these claims the liquidator will have to file suits. To avoid this eventuality and to keep all incidental proceeding in winding-up before the court, its jurisdiction was required to be enlarged to entertain petition, amongst others, for recovering the claims of the company. To give effect to this recommendation, sub-section (2) was suitably amended to bring it to its present form by the Companies (Amendment) Act . 1960. The amendment obviated the need filing of suits by the liquidator (which are prolix and expensive) to realise and recover the claims and subsisting debts owed to the company; and instead, provided a cheap and summary remedy by conferring the required jurisdiction on the company court.

9. <NAME> entire submission had been that a working principle may be got evolved which would, on the one hand. protect the substantive right of a secured creditor, specially in view of large sums of money being advanced of late of such creditors and, on the other hand, not jeopardize the interest of other secured creditors, according to the learned counsel, these twin objects can be achieved if the company court were to grant leave wherever required as a rule, subject to reasonable conditions. This would preserve the integrity of the substantive right of the secured creditor. The terms to be imposed which should facilitate, rather than obstruct, the realization of security. Further, wherever a receiver has been appointed prior to the commencement of the winding-up proceedings, he should be permitted to continue in general run of case as to the suits to be filed after the winding-up proceeding has commenced, the learned counsel urged that such a permission should normally granted by the winding-up court. On this being done, when the question of appointment of receiver would arise, the civil court would on so if a case for same were to be made out after hearing the liquidator, who would be a defendant in the suit. As regards transfer of the pending suit by the company court, the submission was that convenience may not be the guiding factor; the preservation of integrity of the substantive right of the creditor should be the main consideration.

(10) To buttress his submissions, <NAME> has referred us to the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, which was recently enacted because of the considerable difficulty being experienced by financial institutions in recovering loans and enforcement securities charged with them. Earlier, recovery procedure used to black a significant portion of their funds in unproductive assets, the value of which deteriorates with the passage of time. An urgent need was, therefore for successful implementation of the financial through which dues to these institutions could be realized without dely. To achieve this purpose, the aforesaid Act visualizes establishment of <ORG>) by <ORG>, with its own procedure which is speedy in nature. Section 18 of this Act has barred jurisdiction of other courts, except the writ power of the higher courts, in relation to the matters specified in section 17 - the same being recovery of debts due to such institutions.

11. <NAME> who appeared for official liquidator in many cases, however, urged that it is the liquidator who can look after the interests of all the secured creditors. and so, his actions should be allowed to prevail over that of the receiver. He submitted that section 529 of the Act contains many provisions to duly protect the interest of secured creditors. <NAME>, appearing for some of the respondents, brought to our notice that part of subsection (1) of section 446 which mentions about the grant of leave on "such terms as the <ORG> may impose", which provision. according to learned counsel, means that the terms have to be reasonable. The underlying idea of this contention is that there cannot he any uniform working principle, and the question whether leave should be granted, if so, on what terms and whether transfer should at all be ordered would depend on the facts and circumstances of each case.

12. We have duly applied our mind to the rival contentions. It is no doubt correct that the interest of the secured creditor, who has taken recourse to an independent proceeding to realise his debt has to be protected; but it is apparent this cannot be done at the cost of other secured creditors. To preserve the integrity of one secured creditor, another secured creditor cannot be discredited - his integrity has to be of equal concern. It may, however, be that in a particular case the secured creditor who has approached the civil court happens to be one who has lent huge amount, or be one who is the main secured creditor. In such a situation. on approach being made by such creditor, we have no doubt that company court would duly take note of this fact and should like to grant leave required by sub- section (1) of section 446 ; and by the same token refuse to transfer the proceeding to his court. This is not to say that in all cases where the proceeds have been initiated by the main secured creditor, the company court would grant leave. such would depend on the circumstances of each case. But, if the position be that the secured creditor who had approached the civil court is one amongst many similar creditors, <ORG> may be that the company court feels that to take care of the interest of other secured creditors. either the relief of leave does not deserve to be granted or that the proceeding is required to be transferred to it for disposal. It may be pointed out that sections 529 and 529A of the Act do contain provisions in so far as the priority of secured creditor's claim is concerned. Of course, the company court would not transfer the proceeding to it merely because of its convenience ignoring the difficu<ORG>ies which may have to be faced by the secured creditor, who may be at a place far away from the seat of the company court. The need to protect the company from unnecessary litigation and cost have, however, to be borne in mind by the company court.

13. We are. therefore, of the view that the approach to be adopted in this regard by the company court does not deserve to be put in a straight jacket formula. The discretion to be exercised in this regard has to depend on the facts and circumstances of each case. While exercising this power we have no doubt that the company court would also bear in mind the rationale behind the enactment of Recovery of Debts Due to the Banks and Financial Institutions Act, 1993, to which reference has made above. We make the same observation regarding the terms which a company court should like to impose while granting leave. It need not be stated that the terms to be imposed have to be reasonable, which would, of course, vary from case to case According to us, such an approach, would maintain the integrity of that secured creditor who had approached the civil court or desires to do so. and would take care of the interest of other secured creditors as well which the company court is duty bound to do. The company court shall also apprise itself about the fact whether dues of workmen are outstanding; if so, extent of the same It would be seen whether after the assets of the company are allowed to be used to satisfy the debt of the secured creditor, it would be possible to satisfy the workmen's dues pari passu.

14. The appeals and transfer cases stand disposed of with these observations, leaving the company court to pass appropriate orders in the concerned matters in the light of what has been stated by us. No order as to cost.