PETITIONER: ASSISTANT COLLECTOR OF CENTRAL EXCISE,CALCUTTA DIVISION Vs. RESPONDENT: <ORG>. DATE OF JUDGMENT09/08/1972 BENCH: <NAME>, M. HAMEEDULLAH BENCH: <NAME>, M. HAMEEDULLAH RAY, A.N. DUA, I.D. CITATION: 1972 AIR 2563 1973 SCR (1) 822 CITATOR INFO : R 1985 SC 537 (15) F 1986 SC1964 (8) RF 1989 SC 516 (28) E 1989 SC1829 (5,16) RF 1991 SC 456 (5) R 1992 SC1756 (14) ACT: Central Excise Rules-Rule 10 and 10A, Whether the impugned notice fell under Rule 10 to be ineffective and barred by limitation. HEADNOTE: The respondent manufactures cigarettes at its factory upon which Excise Duty is levied by the Assistant Collector of <ORG> Calcutta Division. The rates varied according to the provisions of Finance Act , 1951, and 1956 and the Additional Duty of Excise (Goods of Special Importance) Act, 1957. The <ORG> was required to furnish quarterly consolidated price lists and the particulars of cigarettes to be cleared were furnished by the <ORG> as required by Rule 9 of the Central Excise Rules. For facilitating collection of duty, the <ORG> maintained a large sum of money in a Current Account with the Central Excise authorities, who used to debit this account for the duty leviable on each stock of cigarettes allowed to be removed. The <ORG> used, to furnish its quarterly price lists to the Collector ,on forms containing nine columns and until July 1957, so long as this form was used by the <ORG>, no difficulty was experienced in checking prices. But after this column was dropped from the new form of six, columns, the Excise authorities encountered some difficulty in valuing the cigarettes for levying Excise Duty. They therefore, changed the basis of assessment from the Distributors selling price to the wholesale cash selling price at which stockists or agents were selling the same in the open market. The authorities informed the <ORG> of this change of basis on 5-11-58 by letter, which also asked the <ORG> to furnish its price lists immediately for determining the correct assessable value of its cigarettes. Two days thereafter, the authorities served a notice upon the <ORG> demanding payment of Rs. 1,67,072,40 P. as Basic Central Excise Duty and Rs. 74,574,85 P. as Additional Central Excise Duty on ground of short levy for a certain brand of cigarettes cleared from <ORG>'s Factory between 10th August 1958, After another five days, the authorities sent another notice demanding more than Rs. 6 lakhs as Basic Central Excise Duty and more than Rs. 2 lakhs as Additional Central Excise Duty. On the following day, the authorities sent a third notice under Rule 10-A of the Central Excise Rules, demanding more than Rs. 40,000/as Central Excise Duty and more than Rs. 16,000/- as Additional Duty. The <ORG> challenged these notices by a writ before <ORG>., <ORG> quashed the notices on the ground that the <ORG> had not been given an opportunity of being heard. No appeal was filed by the other side against this decision, but when the case went back to the Collector, he issued P. fresh notice on 24-4-1960. By this notice, for certain periods, a sum of more than Rs. 10 lakhs was levied as Basic Central Excise Duty and a total sum of more than Rs. 3 lakhs as Additional Duty, and this amount had been provisionally debited in the <ORG>'s Account on the basis of the price list supplied by the <ORG> and the <ORG> was informed that if it desired a personal hearing, it 823 can appear before the authorities to make the final assessment in accordance with law. The <ORG> challenged the validity of this notice dated 24- 4-60 on the ground that the notice was barred by limitation and was 'issued without jurisdiction, so that no proceedings could be taken. The learned single Judge, as well as the Divisional Bench of <ORG> allowed the petition on the ground that the notice was barred by time under Rule 10 of the Central Excise Rules because the notice was held to be fully covered by Rule 10 and by no other rule. The case was certified under Art. 33(a ), (b) and (d) for an appeal to this <ORG>. Rule 10 of the Central Excise Rules provides that when duties or charges have been short levied through inadvertence or misconstruction etc., the person chargeable with the duty so short levied, shall pay the deficiency or pay the amount paid to him in excess on written demand by the proper officer within three months from the date on which the duty or charge is paid or adjusted in the owner's account, if any, or from the date of making the refund.It was contended that this was substantially a provisional assessment covered by Rule 10-B. <ORG> of <ORG>, however, refused to agree that the impugned notice of 24-460 fell under Rule, 10-A. The reason given for this refusal was that such a case was neither taken before the learned single Judge, nor could be found in the grounds, of the appeal despite the fact that the appellant had ample opportunity of amending its Memorandum of Appeal. Allowing the appeal. HELD : (i.) That <ORG> erroneously refused to consider whether the impugned notice fell under Rule 10-A. The applicability of Rule 10-A was very much in issue because the Collector in his affidavit denied that Rule 10-A of the said rules had any application to the facts of the case. (ii) It cannot be accepted that merely because the current account kept under Rule 9 indicated that an accounting had taken place, there was necessarily a legally valid or complete levy. The making of debit entries was only on ground of collection of the tax. Even if payment or actual collection of tax could be spoken of as a defective levy, it was only provisional and not fINal. It could only be closed or invested with validity after carrying out the obligation to make an assessment that really determines whether the levy is short or complete. It is not a faCtual or presumed levy which could prove an assessment. This has to be done by proof of the actual steps taken which constitute assessment. [836D] A mechanical adjustment, or settlement of accounts by making debit entries was gone through in the present case, but it cannot be said that any such adjustment is assessment which is a quasi-judicial process and involves due application of mind to the facts, as well as to the requirements of law. Rule 10 and 10-A seems to be so widely worded as to cover any inadvertence error etc.; whereas Rule 10-A would appear to cover any deficiency in duty if the duty has for any reason, been short-levied, except that it would be outside the purview of Rule 10-A if its collection is expressly provided or by any rule. Both the rules as they stood at the relevant time, deal with collection, and not with assessment. In <NAME> case (A.I.R. 1971 S.C. 2039) this <ORG> indicated that Rule 10-A which was residual. in character, would be inapplicable if a case fell within a specified category of cases mentioned in Rule 10. It was pointed out in <NAME>'s case that the reason for the addition 824 of the new rule 10-A was a decision of the Nagpur (<NAME> case; A.I.R. 1952 Nagpur 139), so that a fresh demand may be made on a basis altered by law. The excise authorities had made a fresh demand under Rule 10-A, the validity of which was challenged, but it was upheld by a Full Bench decision of <ORG> of Nagpur. This <ORG>, in <NAME> case also rejected the assessee's claim that Rule 10-A was inapplicable after pointing out that the new rule was specifically designed for the enforcement of the demand like the present one. [836F- 837E] (iii)The present case, therefore, falls within the residuary clause of unforeseen cases from the provisions of S. 4 of the Act, read with Rule 10-A, an implied power to carry out or complete an assessment, not specifically provided for by the rules, can be inferred. Therefore, it is wrong to hold that the case falls under Rule 10 and not under Rule 10-A. JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1101 of 1967,.

Appeal by certificate from the judgment and order dated September 28, 1966 of <ORG> in Appeal No. 7 of 1965.

<NAME>, <NAME> and <NAME>, for ;the appellant.

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

The Judgment of the Court was delivered by <NAME>, J. <ORG> (herein- after referred to as "the <ORG>"), the Respondent in the appeal before us, manufactures Cigarettes, at its Factory in Agrapara, upon which Excise duty is -vied by the appellant, the Assistant Collector of <ORG> Calcutta Division (hereinafter referred to as "the Collector"). The rates at which the Excise duty was imposed upon the cigarettes of the <ORG> under the provisions of the <ORG> and Salt Act of 1944 (hereinafter referred to as "the Act") were varied, from time to time, by the provisions of Finance Act s of 1951 and 1956 and the Additional Duties of Excise (Goods of Special Importance) Act of 1957. The Collector maintained an office at the factory itself for the levy and collection of tax. The <ORG> was required to furnish quarterly consolidated price-lists which used to be accepted for purposes of enabling the <ORG> to clear its goods, but, according to the Collector, these used to be verified afterwards by obtaining evidence of actual sales in the market before issuing final certificates that the duty had been fully paid up. The particulars of the cigarettes to be cleared were furnished by the <ORG> on forms known as A.R.1 forms required by Rule 9 of the Central' Excise Rules. For facilitating collection of duty, the <ORG>, maintained a large sum of money in a current account with the <ORG> authorities who used to debit in this account the duty leviable on each stock of cigarettes allowed to be removed. This current account, known as "personal ledger account", was maintained under the third proviso to Rule 9 which lays down:

9(1) " * * * * * *

Provided also that the Collector may, if he thinks fit, instead of requiring payment of duty in respect of each separate consignment of goods removed from the place or premises specified in this behalf, or from a store room or warehouse duly approved, appointed or licensed by him keep with any person dealing in such goods an account-current of the duties payable thereon and such account shall be settled at intervals not exceeding one month and the account-holder shall periodically make deposit therein sufficient in the opinion of the Collector to cover the duty due on the goods intended to be removed from the place of production, curing, manufacture or storage". It appears that the company used to furnish its quarterly price-lists to the Collector on forms containing nine columns including one to show the "distributors' selling price". Until July 1957, so long as this form was used by the <ORG>, no difficulty seems to have been experienced in checking the prices. But, after this column was dropped from the new form of six columns, the excise authorities seem to have encountered some difficulty in valuing the cigarettes for vying excise duty. They.' therefore, changed the basis of assessment itself from "the Distributors" Selling Price" to "the wholesale cash selling price at which stockists or agents are selling the same to an independent buyer in the open market". They held the view that such a charge could be made having regard to the provisions of Section 4 of the Act. The Deputy Superintendent of <ORG> informed the <ORG>,; of this change of basis on 5- 11-1958 by a letter which also asked the <ORG> to furnish its price lists immediately "for determining the correct assessable value" of its cigarettes. On 7th November,, 1958, the Deputy Superintendent served a notice upon the <ORG> demanding, payment of a sum of Rs. 1.67,072,40 as basic <ORG> duty and Rs. 74,574,85 as additional <ORG> duty on account of short levy for a certain brand of cigarettes cleared from the <ORG>'s factory from 10th August, 1958 to 5th November, 1958. On 12-11-1958, the Deputy Superintendent sent another notice demanding payment of a sum of Rs. 6,16,467,49 as basic <ORG> duty and Rs. 2,10,492,15 as additional central excise duty for short levy in respect of some brands of cigarettes cleared from the factory between 1-11-1957 to 9-8-1958. On 13-11-1959. (the Deputy Superintendent sent a third notice to the <ORG> under Rule 10-A of the <ORG> Rules 1944, demanding payment of Rs. 40,726,48 as basic <ORG> duty and Rs. 16,958.50 as additional duty for short levy in respect of various brands. The <ORG> applied to <ORG> under Article 226 of the Constitution against the three notices mentioned above, one of which specifically under Rule 10-A and the other two under Rule 10 of the <ORG> Rules. A learned single Judge of that Court quashed the notices by his order of 15-2-1960 on the ground that the <ORG> had not been given any opportunity of being heard so as to be able to meet the material collected behind its back which formed the basis of the demands under the aforesaid three notices. On a joint request of both ides. <ORG> did not decide the question whether notices of demand ,were time barred. But, the learned Judge said :

"Nothing in this order will prevent the respondent from proceeding to take any step that may be necessary for such assessment or for the realisation of the revenue in accordance with the law".

The learned Judge had also held that neither the basis adopted by the company nor that put forward by the Collector was correct. The learned Judge pointed out the correct basis which was considered by him to be in consonance with the provisions of Section 4 , sub.s(a) of the Act. He indicated the various factors required by Section 4 of the Act which had to be taken into account and held:

"The determination as to whether a wholesale market exists at the site of the factory or the premises of manufacture or production etc. or which is the nearest wholesale market, or the price at which the goods or goods of like kind and quality are capable of being sold must necessarily be a complicated question and must be determined carefully upon evidence and not arbitrarily. Such determination cannot wholly be made ex-parte, that is to say, behind the back of the assessee. A satisfactory determination can only be made by giving all information to the assessee and after giving the assessee an opportunity of establishing his own point of view, or checking and/or challenging any material or evidence upon which <ORG> wish to depend."

As no appeal was filed by either side against this decision, it became final and binding between parties before us so that the question whether <ORG> has correctly interpreted Section 4 of the Act in determining the basis on which the excise duty leviable could be assessed is not under consideration here.

When the case went back to the Collector, he issued a fresh notice on 24-4-1960. As the validity of this notice is the real question now in issue in the appeal before us, it may be reproduced in toto here. It turns as follows:

Registered A/D GOVERNMENT' OF INDIA Collectorate of Central Excise Office of the Assistant Collector of Central Excise, Calcutta I Division (5, Clive Row), Calcutta NOTICE C. No. VI(b)14/3/58/3886 Dated 21st April., TO M/s. <ORG>, Agarpara, 24 Parganas.

In connection with the assessment of <ORG> duties for the periods :

1. from 1st October, 1957 to 5th November, 1958 in respect of 316,885,000 of "No. Ten" brand Cigarettes.

II. from 1st January, 1958 to 28th January , 1958 in respect of 6,600,000 of "D.L.T. Mag" Cigarettes.

III. from 1st January, 1958 to 5th February, 1958 in respect of 9594,000 of "May Pole" Cigarettes'.

IV. from 1st January, 1958 to 7th February, 1958 in respect of 3143,500 "Carltons Gold Seal" Cigarettes.

V. from 1st January 1958 to 31st January, 1958 in respect of 1471,250 of "John Peel" Cigarettes.

VI. from 1st January, 1958 to 16th January, 1958 in respect of 8200,000 of "Light House" Cigarettes.

VII. from 1st January, 1958 to 16th January, in respect of 9070,000 of "Gold Link" Cigarettes.

Please note that a sum of Rs. 10,05,133.25 np. (Rupees 10 lads five thousand one hundred thirty three and twenty-five naya paise only) as basic Central Excise duty and a total sum of Rs. 3,43,208.25 np. (Rupees three lacs forty-three thousand two hundred eight and twenty-five naya paise only) as additional duty had been provisionally debited in your account on the basis of the price list supplied to us by you for the quarters

(i) beginning October, 1957 dated 17th October, 1957.

(ii) beginning January, 1958 dated nil.

(iii) beginning April, 1958 dated 14th April, 1958, and

(iv) beginning July, 1958 dated 14-7-58, and

(v) beginning October, 1958, dated nil.

2. We now propose to complete the assessments for the said periods from the evidence in our possession from which it appears :-

(i)that there is no wholesale market for the goods covered by your price lists in or near the factory or the 'Place of manufacture and that the nearest wholesale market for the sale is the Calcutta market.

(ii) the wholesale cash price of the articles in question at the time of sale and/or removal of the ,,goods at the Calcutta market at which goods of like kind or quality are sold or are capable of being sold have been ascertained by us and the evidence at our disposal reveals that the prices quoted by you in your price- list are-not correct.

3. The prices at,-- as per chart annexed hereto which has been prepared on the basis of available evidence in terms of section 4 (a) , of the Central Excise and Sale Act , 1955. The vouchers mentioned in the chart are available for your inspection at any time next week during office hours. After obtaining inspection of the vouchers please attend at our office at 5 Clive Row, Calcutta on 2nd May 1960 at 10.30 a. 'M. for the purpose of discussing the points mentioned above

4. We are prepared to give you a personal hearing with regard to all the points indicated above. If you have any evidence in support of your contention you are at liberty to produce the same at the time of bearing. Thereafter please note that we propose to make the final assessment in accordance with law.

Sd./- (N. D. MUKhERJEE) Assistant Collector of Central Excise, Calcutta I Division, Calcutta"

The Company challenged the validity of this notice by means of a second petition for Writs of Prohibition and Mandamus against the Collector on the ground that the notice was barred by time and was issued without jurisdiction so that no proceedings founded on it could be taken. It was prayed that the Collector may be ordered to cancel the notice. The petition was allowed by a learned Single Judge of <ORG> on 3-1-1964 on the ground that such a notice was barred by the provisions of Rule 10 of the Central Excise Rules 'because the notice was held to be fully covered by Rule 10 and by no other rule. A Division Bench of <ORG> confirmed this view on 8-9-1966 and dismissed the Collector's appeal. The case having been certified, under Article 133(a ), (b) and (c) for an appeal to this Court, this question is before us now.

The learned Single Judge as well as the Division Bench of <ORG> said that there was not enough material on record to conclude that there was any "provisional assessment" under Rule 10-B (deleted on 1-8- 1959 and substituted by Rule 9-B) which laid down:

"10B. PROVISIONAL ASSESSMENT OF DUTY (1) Notwithstanding anything contained in these rules

(a) There the owner of any excisable goods makes and subscribed a declaration before the proper Officer to the effect that he is unable for want of full information to state precisely the real value or description of such goods in the proper Form : or

(b) Where the owner of any goods has furnished full information in regard to the real value or description of the goods, but the proper Officer requires further proof in respect thereof; or

(c) Where the proper Officer deems it expedient to subject any excisable goods to any chemical or other test, The proper Officer may direct that the duty leviable on such goods may, pending the pro- duction of such information or proof or pending the completion of any such test, be assessed provisionally.

(2) When the owner of any goods in respect of which the duty has been assessed provisionally under sub-rule(1) has paid such duty, the proper Officer may make an order allowing the goods to be cleared for home consumption or for exportation, as case may be and such order shall be sufficient authority for the removal of the goods by the owner:-

Provided that before making any such order the proper officer shall require the owner to furnish a bond in the proper form binding the Owner to pay the differen-

tial duty When the final assessment is made. (3) When the duty leviable on such goods is assessed finally in accordance with the provisions of these rules, the duty provisionally assessed shall be adjusted against the duty finally assessed, and if the duty provisionally assessed, falls short of, or is in excess of, the duty finally assessed. the owner of the goods shall pay the deficiency or be entitled to a refund, as the case may be."

No order directing provisional assessment, contemplated by Rule 10-B, (applicable at the relevant time) has been placed before us. Nor was the <ORG> asked by the Collector to furnish a bond to pay up the difference after making a final assessment as was required under Rule 10-B. It was, however, contended for the Collector that the execution of a bond, for the satisfaction of the Collector, could be dispensed with in a case where the <ORG> kept a large sum of money in deposit in the "personal ledger account" to guarantee its ability to meet its liabilities. It was also pointed out that the learned Single Judge as well as the <ORG> Bench had found that the practice of provisionally approving the price-lists supplied by the <ORG>, pending acceptance of their correctness after due verification, had been established as a mater of fact. It was submitted that this was substantially a "provisional assessment" covered by Rule 10-B, although it may not conform to the technical procedural requirements of such an assessment. Even if the making of debit entries could, on the facts of the case, be held to be merely provisional think that what took place could not be held to be a "provisional assessment" within the provisions of Rule 10-B which contemplated the making of an order directing such an "assessment" after applying_ the mind to the need for it. Before proceeding further we will deal with the question whether the <ORG> Bench correctly refused to permit an argument that the impugned notice of 24-4-1960 fell under Rule 10-A. The ground given for this refusal was that such a case was neither taken before 'the learned Single Judge nor could be found in the grounds of appeal despite the fact that the appellant had ample opportunity of amending its Memorandum of appeal. The appellant has, however, relied on a previous intimation given to the counsel for the respondent that such a contention would be advanced at the hearing of the appeal and also on an application dated 21-3- 1966 praying for permission to add the alternative ground that the impugned notice fell under Rule 10-A. We think that this refusal was erroneous for several reasons. Firstly the <ORG> having come to Court for a Writ of Pro- hibition on the ground that the impugned notice was issued with-

out jurisdiction had necessarily to establish the case which it sets, up in paragraph 25 of its Writ Petition, that the notice was not authorised by the rules including Rule 10-A. As the notice of 21-4-1960 was followed on 4-5-1960 by a correction by another notice of certain statements both the notices were assailed in paragraph 25 (ii) in the following words "The respondent has mala fide and without jurisdiction issued the said impugned notices pretending to falsely state that the aggregate sum therein mentioned has been provisionally debited in your petitioner's account and pretending to intimate, to your petitioner that the respondent proposed to complete the assessment, And thereby, he is seeking, under the guise of completing an alleged assessment which had already been completed and duty in respect whereof had already been paid, to do indirectly what he could not do directly inasmuch as Rule 10A of the said Rules has no application to the facts of the case and inasmuch as recovery of any duty which might have been short levied under Rule 10 of the Rules is barred by limitation".

This assertion was met by a categorical denial by the Collector in paragraph 26(ii) of the Collector's affidavit in reply where it was stated that it was denied "that Rule 10-A of the said Rules had no application to the facts of the case as alleged or that the recovery of any duty which had been short levied was barred by limitation under Rule 10 of the said Rules as alleged or at all". Thus, the applicability of Rule 10-A was very much in issue. Secondly, We find, from the Judgment of the learned Single Judge that, as the burden lay upon the petitioning <ORG> to demonstrate, for obtaining a Writ of Prohibition, that the impugned notice was not authorised by any rule, its counsel had contended',, inter-alia, that the notice did not fall under Rule 10-A. The question was thus considered by the learned Single Judge. Thirdly, the question whether the Collector did or did not have the power to issue the impugned notice under or with the aid of Rule 10-A was a question of law and of jurisdiction. going to the root of the case, which could be decided without taking further evidence. Indeed, as the burden was upon the petitioning <ORG> to show that the impugned notice was issued without jurisdiction, a finding that the notice did not fall even within Rule 10-A was necessary before a Writ of Prohibition could issue at all. We think that <ORG> ought to have permitted the question to be argued, subject to giving due opportunity to the petitioning <ORG> to meet it on such, terms as the <ORG> thought fit, even if the point was not taken in the grounds of appeal. Therefore, we will consider this question also.

Rule 10 of the Central Excise Rules, ran as follows "10. Recovery of duties or charges short-

levied, or erroneously refunded-

When duties or charges have been short-levied, through inadvertence, error, collusion or mis- construction on the part of an officer, or through misstatement as to the quantity, description or value of such goods on the part of the owner, or when any such duty or charge, after having been levied, has been owing to any such 'cause, erroneously refunded, the person chargeable with the duty or charge, so short-levied, or to whom such refund has been erroneously made, shall pay the deficiency or pay the amount paid to him in excess, as the case may be, on written demand by the proper officer being made within three months from the date on which the duty or charge was paid or adjusted in the owners account-current, if any, or from the date of making the refund". Rule 10-A reads as follows:

"10-A Residuary powers for recovery of sums due to Government.-

Where these Rules do not make any specific provision for the collection of any duty, or of any deficiency in duty if the duty has for any reason been short levied, or of any other sum of any kind payable to <ORG> under the Act or "these Rules, such duty, deficiency in duty or sum shall, on a written demand made by the proper officer, be paid to such person and at such time and place, as the proper officer may specify." The two rules set out above occur in Chapter III of the Central Excise Rules 1944 headed "Levy and Refund of, and Exemption from Duty". Rule 7 merely provides that the duty leviable on the goods will be paid at such time and place and to such, person as may be required by the rules. Rule 8 deals with power to authorise exemptions in special cases. Rule 9(1) provides for the time and manner of payment of duty. This rule indicates that ordinarily the duty leviable must be paid before excisable goods are removed from the place where they are manufactured or stocked, and only after obtaining the permission of the officer concerned. The third proviso to Rule 9 has already been set out above. Rule 9(2) provides for the recovery of duty and imposition of penalty in cases where Rule 9 sub. r (1) is violated. Rule 9A specifies the date with reference to which the duty payable is to be determined. We are ,not concerned here with Rules 11 to 14 dealing with refunds, rebates, exports under bonds and certain penalties for breaches of Rules. Rule 52 and 52-A, found in Chapter V, dealing with a number of matters relating to "Manufactured Goods", may also be cited here :

"52. Clearance on payment of duty-When the manufacturer desires to remove goods on payment of duty, either from the place or a premise specified under rule 9 or from a store-room or other place of storage approved by the Collector under rule 47, he shall make application in triplicate (unless otherwise by rule or order required) to the proper officer in the proper Form and shall deliver it to the Officer at least twelve hours (or such other period as may be elsewhere prescribed or as the Collector may in any particular case require or allow) before it is intended to remove the goods. The officer, shall, thereupon, assess the amount of duty due on the goods and on production of evidence that this sum has been paid into the <ORG> or paid to the account of the Collector in <ORG> or <ORG>, or has been despatched to the <ORG> by money-order shall allow the goods to be cleared".

"52A. Goods to be delivered on a Gate pass- (1) No excisable goods shall be delivered in a factory except under a gatepass in the proper form or in such other form as the Collector may in any particular case or class of cases prescribe signed by the owner of the factory and countersigned by the proper officer."

It will be noticed that in Chapter III, the term "assessment" was used only in the former rule 10-B, corresponding to the present rule 9-B, while dealing with provisional assessment of duty. But, Rule 52 shows that an "assessment" is obligatory before every removal of manufactured goods. The rules however, neither specify the kind of notice which should precede assessment nor lay down the need to pass an assessment order. All we can say in that rules of natural justice have to be observed for, as was held by this Court in <CITATION> (1), "the assessment of a tax on person or property is atleast of a quasi-judicial character".

(1) [1961] 3 S.C.R. 77 @ 94.

L--Sup.CI/73  Section 4 of the Act lays down what would determine the value of excisable goods. But, the Act itself does not specify a procedure for assessment presumably because this was meant to be provided for by the rules. Section 37(1) of the Act lays down that "the Central Government may make rules to carry into effect the purposes of this Act". Section 37 , sub. s (2), particularises without prejudice to the generality of the foregoing power" that "such rules may provide for the assessment and collection of duties of excise, the authorities by whom functions under this Act are to be discharged , the issue of notice requiring payment, the manner in which the duty shall be payable, and the recovery of duty not paid". It is clear from Section 37 that " assessment and collection of duties of excise" is part of the purposes of the Act, and Section 4 , dealing with the determination of value for the purposes of the duty, also seems to us to imply the existence of a quasi-judicial power to assess "he duty payable in cases of dispute. "Collection", seems to be a term used for a stage subsequent to "assessment". In a case where the basis of a proposed assessment is disputed or where contested questions of fact arise, a quasi-judicial procedure has to be adopted so as to correctly assess the tax payable. Rule 52 certainly makes an "assessment" obligatory before removal of goods unless the procedure for a "provisional assessment" under Rule 10-B (now rule 9-B) is adopted. But, if no quasi-judicial pro- ceeding, which could be described as an "assessment" either under Rule 52 or "Provisional assessment" under Rule 10-B (now Rule 9-B) takes place at the proper time and in accord- ance with the rules, is the Collector debarred completely afterwards from assessing or completing assessment of duty payable ? That seems to us to be the real question to be decided here.

One of the arguments on behalf of the Collector was that no "assessment", for the purpose of determining the value of excisable goods, having taken place in the case before us, there could be no "levy" in the eye of law. It was urged that, even if there was no "provisional assessment", as contemplated by Rule 10-B, whatever took place could, at the most, be characterised as an "incomplete assessment", which the Collector could proceed to complete, even after the removal of the goals. It was contended that such a case would be outside the purview of Rule 10 as it was not determined whether there actually was a short levy. Hence, it was submitted there was no question of a proceeding barred by the limitation prescribed for making a The demand for a short levy in certain specified circumstances.<ORG>, while repelling this contention, held :

"In the present case, it appears that the procedure adopted was that the respondents issued a price list quarterly. In that price list, they gave their own estimate as to the value of the goods. For the time being the excise authorities accepted the value so given, and gave a provisional certificate to that effect, intending to check the market value and then finally determine the value later on. The procedure for issuing price list of approving the same provisionally and accepting payment therefore according to the estimate of the manufacturer, is a procedure which is not to be found either in the Act or the Rules".

It may be observed that this finding, that the procedure of a provisional acceptance of the Company's estimates was adopted, seems inconsistent with another finding that what took place was a final adjustment of accounts within the purview of the 3rd proviso to Rule 9, set out above, constituting a "levy" accord to law. <ORG> appears to have regarded this procedure of an almost mechanical levy as equivalent to a complete assessment followed by the payment of the tax which constituted a valid "levy". Hence, it concluded that, there being a legally recognised levy, the only procedure open to the Collector for questioning its correctness was one contemplated by Rule 10 so that a demand for a short levy had to be made within 3 months of the final "settlement of accounts" as provided specifically by Rule 10. <ORG> considered this procedure to be an alternative to an assessment under Rule 52 at the proper time and also :to a provisional assessment in accordance with the procedure laid down in Rule 10-B. But, to regard the procedure under Rule 10 as an alternative to an assessment would be to overlook that it presupposes an assessment which could be reopened on specified grounds only within the period given there.

The term "levy" appears to us to be wider in its import than the term "assessment". It may include both "imposition" of a tax as well as assessment. The term "imposition" is gene- rally used for the, levy of a tax or duty by legislative provision indicating the subject matter of the tax and the rates at which it has to be taxed. The term "assessment", on the other hand, is generally used in this country for the actual procedure adopted in fixing the liability to pay a tax on account of particular goods or property or whatever may be the object of the tax in a particular case and determining its amount. <ORG> appeared to equate "levy" with an "assessment" as well as with the collection of a tax when it. held that "when the payment of tax is enforced, there is a levy". We think that, although the connotation of the term "levy" seems wider than that of "assessment", which it includes, yet, it does not seem to us to extend to "collection". Article 265 of the Constitution makes a distinction between "levy" and "collection". We also find that in <CITATION> (1), this <ORG> made a distinction between "levy" and "collection" as used in the Act and the Rules before us. It said there with reference to Rule 1 0 :

"We are not inclined to accept the contention of of Dr. <NAME> that the expression 'levy' in Rule 10 means actual collection of some amount. The charging provision Section 3(1) specifically says. 'There shall be levied and collected in such a manner as may be prescribed the duty of excise . . .' It is to be noted that subsection (i) uses both the expressions "levied and collected" and that clearly shows that the expression 'levy' has not been used in the Act or the Rules as meaning actual collection".

We are, therefore, unable to accept the view that, merely because the "account current", kept under the third proviso (erroneously mentioned as second proviso by <ORG>) to Rule 9, indicated that an accounting bad taken place, there was necessarily a legally valid or complete levy. The making of debit entries was only a mode of collection of the tax. Even if payment or actual collection of tax could be spoken of as a de facto "levy" it was only provisional and not final. It could only be clothed or invested with validity after carrying out the obligation to make an assessment to justify it. Moreover, it is the process of assessment that really determines whether the levy is short or complete. It is not a factual or presumed levy which could, in a disputed case, prove an "assessment". This has to be done by proof of the actual steps taken which constitute "assessment".

Undoubtedly, a mechanical adjustment and ostensible settle- ment of accounts, by making debit entries, was gone through in the case before us. But, we could not equate such an adjustment with an assessment, a quasi-judicial process which involves due application of mind to the facts as well as to the requirements of law, unless we were bound by law to give an unusual interpretation to the term "assessment". Here, we do not find any such definition of assessment or any compelling reason to bold that what could at most be a mechanical provisional collection, which would become a "levy" in the eve of law only after an "assessment", was itself a levy or an assessment.

Rules 10 and 10A, placed side by side, do raise difficulties of interpretation. Rule 10 seems to be so widely worded as to (1) A.I.R. 1971 S.C. 2039 2045.

cover any "inadvertence, error, cullusion or misconstruction on the part of an officer", as well as any "misstatement as to the quantity, description or value of such goods on the part of the owner" as causes of short levy. Rule 10-A would appear to cover any "deficiency in duty if the duty has for any reason been short levied", except that it would be outside the purview of Rule 10A if its collection is expressly provided for by any Rule. Both the rules, as they stood at the relevant time, dealt with collection and not with assessment. They have to be harmonised, In <NAME> case (<NAME>), this <ORG> harmonised them by indicating that Rule 10A, which was residuary in character, would be inapplicable if a case fell within a specified category of cases mentioned in Rule 10.

It was pointed out in <NAME>'s case (<NAME>). that the reason for the addition of the new Rule 10A was a decision of <ORG> in <CITATION> (1), so that a fresh demand may be made on a basis altered by law. The Excise authorities had then made a fresh demand, under the provisions of Rule 10-A, after the addition of that Rule, the validity of which challenged but upheld by a Full. Bench of <ORG> of Nagpur. This Court, in <CITATION> ( 2 ) also rejected the assessee's claim that Rule 10- A was inapplicable after pointing out that the new rule had been specifically designed" for the enforcement of the demand like the one arising in the circumstances of the case".

We think that Rule 10 should be confined to cases where the demand is being made for a short levy caused wholly by one of the reasons given in that rule so that an assessment has to be reopened. The findings given by <ORG> do not show that, in the case before us, there was either a short levy or that one of the grounds for a short levy given in Rule 10 really and definitely existed. No doubt <ORG> gave a reason for the way in which the claims became time barred, in the following words:

"It is quite possible, that the Excise authorities, in an attempt tohelp the, appellants, by facilitating the movements of goods, inadvertently allowed the claims to be barred by limitation. That, however, is not a matter which can affect the question of limitation.The bar of limitation has been imposed by Statute. The morality of the case or the conduct of the parties is therefore irrelevant unless the law provides that the court on that ground can afford relief' (1) A.I.R, 1952 Nag. 139, (2) [1962] Supp. 2 S.C.R. 1 This finding was presumably given to show that the impugned notice fell within the purview of Rule 10 because the demand was due to a short-levy caused by "inadvertence" of the officer concerned. It will be noticed that <ORG> did not go beyond finding a "possibility" of such inadvertence. This is not a finding that it was definitely du.-, to it. No finding which could clearly relate the, case to any cause for short levy found in Rule 10 was given.

Moreover, we find that there was no case taken up by the <ORG> in its petition before <ORG> that any short levy resulted from an inadvertence. of the officer concerned in the process of assessment. The case set up was that of a levy after a completed assessment, in accordance with law, which could not, according to the <ORG>, be reopened. If, therefore, as we find from the conclusions recorded by <ORG> itself what took place was not an "asseessment" at all in the eye of law, which could not be reopened outside the provisions of Rule 10, we think that the case will fall beyond Rule 10 as it stood at the relevant time. The notice set out above does not purpoe, to be issued under any particular rule probably because the Collector,. in the circumstances of the case, was not certain about the rule under which the notice could fall. But, as was pointed out by this Court in <NAME>'s case (Supra), the failure to specify the provision under which a notice is sent would not invalidate it if the power to issue such a notice was there. The notice alleges that it is a case of "incomplete assess- ment". The allegations contained in it have been characterised by the learned counsel for the <ORG> as a change of front intended to cover up the neglet of the Collector in failing to comply with the correct procedure of making either an assessment before delievery contemplated by Rule 52 or a provisional assessment under Rule 10-B. We are unable to hold, either upon the findings given by <ORG> or upon facts transpiring from the affidavits filed by the parties that the notice was a mere cloak for some omission or error or inadvertence of the Collector in making a levy or an assessment.

We may point out that Rule 10 itself has been amended and made more reasonable in 1969 so as to require a quasi- judicial procedure by serving a show cause notice "within 3 months from the date on which the duty or charge was paid or adjusted in the owner's account current, if any". This amendment, made on 11-10-1969, indicates that the quasi- judicial procedure. for a finding on an alleged inadvertence, error, collusion, or misconstruction by an officer, or misstatement by the assessee, as the cause of an alleged short levy resulting from an assessment, can now be embarked upon and not necessarily completed within the prescribed period. We are, however, concerned with the procedure before this amendment took place. At that time, it was certainly not clear whether a case would fall under Rule 10 even before the short levy or its cause was established. Furthermore, in the present case, the reason for an alleged short levy could be a change of basis of proposed assessment under instructions from higher authorities mentioned above. Even that change of basis was held by <ORG> to be erroneous. Until <ORG> indicated the correct basis there was an uncertainty about it. Such a ground for an alleged short levy would be analogous to the reason for the introduction of Rule 10-A itself _ which, as pointed out in <NAME> case (<ORG>), was 'a change in the law. One could go back still further and come to the conclusion that the real reason ',or the alleged short levy was a failure of the <ORG> to supply the fuller information it used to supply previously and not just a misstatement. If the case does not clearly come within the classes specified in Rule 10, this rule should not be invoked because, as was rightly contended for the appellant, a too wide construction put on Rule 10 would make Rule 10A useless. The two rules have to be read together.

It is true that Rule 10-A seems to deal only with collection and not with the ascertainment of any deficiency in duty or its cause by a quasi-judicial procedure. If, however, it is read in conjunction with Section 4 of the Act, we think that a quasi-judicial proceeding, in the circumstances of such a case, could take place under an implied power. It is well established rule of construction that a power to do something essential for the proper and effectual performance of the work which the statute has in contemplation may be implied [See Craies on Statute Law (Fifth Edition) P. 105] The question whether there was or was not an implied power to hold an enquiry in the circumstances of the case before us, in view of the Provisions of Section 4 of the Act read with Rule 10-A of the, Central Excise Rule, was not examined by <ORG> because it erroneously shut out consideration of the meaning and applicability of Rule 10A. <ORG> view was based on an application of the rule of construction that where a mode of performing a duty is laid down by law it must be performed in that mode or not at all. This rule flows from the maxim : "Expressio unius act exclusio alterius." But, as we pointed out by <NAME>, J., in <NAME> v. Brooks(1) this maxim "is often a valuable servant, but a dangerous master .... ". The rule is subservient to the basic principle that <ORG> must endeavour to ascertain the legislative intent and (1) (1888) 2 1 Q. B. D. 52,62.

<NAME>

purpose, and then adopt a rule of construction which effectuates rather than one that may defeat these. Moreover the rule of prohibition by necessary implication could be applied only where a specified procedure is laid down for the performance of. a duty. Although Rule 52 makes an assessment obligatory before goods are removed by a manufacturer, yet, neither that rule nor any other rule, as already indicated above, has specified the detailed procedure for an assessment. There is no express pro- hibition anywhere against an assessment at any other time in the circumstances of a case like the one before us where no " assessment", as it is understood in law, took place at all. On the other hand, Rule 10A indicates that there are residuary powers of making a demand in special circumstances not foreseen by the framers of the Act or the rules. If the assessee disputes the correctness of the demand an assessment becomes necessary to protect the interests of the assessee. A case like the one before us falls more properly within the residuary class of unforeseen cases. We think that, from the provisions of Section 4 of the Act read with Rule 10A, an implied power to carry out or complete an assessment, not specifically provided for by the rules, can be inferred. No writs of prohibition or mandamus ",ere, therefore, called for in the circumstances of the case. Consequently, we allow this appeal and set aside the orders of <ORG>. The Collector may now proceed to complete the assessment. In the circumstances of the case, the parties will bear their own costs throughout. Appeal allowed S.C.


JUDGMENT <NAME> and <NAME>, JJ.

1. The suit, out of which this appeal arises, was brought by the plaintiffs appellants against the defendant <NAME>, described as the ojha or high priest of the temple of Baidyanath, for the recovery of the sum of Rs. 18,279-2; and for a declaration that the said amount is realisable by attachment of the surplus of the offerings called charao made to the deity Sri Sri Iswar Baidyanath, and is recoverable from the defendant's successors in office. The main allegations, upon which the claim is based are, that the temple of Baidyanath in the town of Deoghur has from time immemorial been under the management of its ojha or high priest; that the offerings made to the deity in the shape of gifts of money and other things, called charao, were formerly divided between the high priest on the one hand and the Raja of Birbhum, and in succession to him <ORG> on the other, but since the relinquishment of its share by <ORG> in 1791, the whole of the said charao has been taken by the high priest, who is entitled to appropriate to his own use the surplus left after providing for the expenses of the worship and the performance of other obligations appertaining to the institution; that the office of high priest is elective, but confined to the family of the plaintiffs and the defendant, and subject to the final confirmation of the ruling power; that the last ojha Isrinund Datta Jha, father of the plaintiffs and grandfather of the defendant, gave the plaintiffs an ekrar in 1271, stipulating thereby to pay to them and their heirs the sum of Rs. 2,400 annually out of the said charao for their maintenance; that on the death of the said Isrinund Datta Jha, disputes having arisen between the plaintiffs and the defendant as to the right of succession to the office of ojha, the defendant by an ekrar, dated, the 27th of February 1878, promised to pay the plaintiffs and their heirs Rs. 2,400 annually, and the plaintiffs allowed the office of ojha to pass to the defendant; and that the arrears of the said annual allowance of Rs. 2,400 together with interest amount to the sum claimed in the suit.

2. The defence alleges that the temple of Baidyanath is a public place of Hindu worship; that the property appertaining thereto including the charao or offerings is debutter property belonging to the idol Baidyanath, which the ojha or high priest holds only as manager without having any personal right to the same, save and except the right to maintain himself out of it; that the office of high priest is not elective, but passes by succession by primogeniture to the eldest son of the last incumbent, and in his default to his eldest son, and so on; that the ekrars referred to in the plaint cannot create any valid charge in the charao or offerings which constitute debutter property, nor can they bind any succeeding ojha; and that of the amount claimed only a portion, namely the sum of Rs. 5,280, is due to the plaintiffs, and the defendant is personally liable for the same. It appears from the issues that two more objections were subsequently taken by the defendant, namely, that a part of the claim was barred by limitation, and that the claim for interest was not tenable.

3. The Court below has held that the charao or offerings are debutter property, and cannot be charged with liability for the plaintiff's' claim; that the ekrar executed by the defendant is not binding on his successors in office, but that the defendant is personally liable under it; that no part of the claim is barred by limitation; and that interest is claimable for the last three years before suit; and it has accordingly given the plaintiffs a decree against the defendant personally for the greater portion of the claim, disallowing only interest in part.

4. Against that decree the plaintiffs have preferred this appeal, and the defendant has filed a cross-appeal, valued at Rs. 6,286-7-0, the difference between the amount decreed and the amount admitted to be due.

5. In the appeal it is urged : First, that the Court below ought to have declared that the amount decreed was realisable by attachment of the charao or offerings;

Secondly, that the said amount was recoverable from the defendant's successors in office; and Thirdly, that the defendant is not entitled to raise any objection against the terms of his own ekrar. And in the cross-appeal it is contended-

First, that a part of the claim was barred by limitation;

Secondly, that there was no personal covenant to pay, nor any valid and legal consideration for the ekrar, and that no personal decree ought to have been made against the defendant; and Thirdly, that the claim for interest ought to have been disallowed altogether.

Before proceeding to the determination of the appeal and the cross-appeal, it is necessary to dispose of a preliminary question, namely, whether proper <ORG> fees have been paid on the memorandum of appeal and on the petition of cross-appeal.

6. The <ORG> fee paid on the memorandum of appeal is Rs. 10, and the learned vakil for the appellants contended that this was the proper fee chargeable under clause iii of Article 17 of Schedule II of the <ORG> Fees Act, the object of the appeal being only to obtain a declaration that the amount decreed is realisable from the surplus of charao or offerings, and is recoverable from the defendant's successors in office, the prayer for consequential relief, that is, for recovery of the money, having already been granted by the <ORG> below. He further urged that the cross-appeal could not be heard, unless the respondent paid the fee payable on the amount at which it was valued as required by Section 16 of the <ORG> Fees Act. On the other hand, it was argued for the respondent that, as the declaratory decree asked for by the appellants would not amount to a mere declaration, but must necessarily carry with it some consequential relief, the fee payable on the appeal was the ad valorem fee on the amount decreed as required by Article 1 of Schedule I of the Act; and if that was paid, no additional fee would be payable by the respondent under Section 16 .

7. The point not being altogether free from doubt, we reserved judgment upon it, and allowed the hearing of the appeal and the cross-appeal to proceed, upon the parties undertaking through their learned vakils to pay any amount that they might be declared liable to pay.

8. After giving our best attention to the point, the conclusion we arrive at is that the memorandum of appeal has been properly stamped, and that the petition of cross-appeal requires to be stamped with the fee payable on the value of the cross-appeal as provided by Section 16 of the Court Fees Act.

9. It is true that the case does not come under clause iii of Article 17 of the second Schedule of the <ORG> Fees Act upon a literal construction of that clause; for that clause refers to the nature of the suit as the criterion for determining whether an appeal comes under it, and the suit here was clearly not for a declaratory decree without consequential relief. But though that is so, still Section 16 of the Act clearly indicates that, where an appeal is only against a part of a decision, and that part relates only to a portion of the subject-matter, the memorandum of appeal is sufficiently stamped, if it bears the <ORG> fee stamp chargeable upon such portion of the subject-matter. Now, the subject-matter of the suit here was a claim for a certain sum of money, coupled with a claim for a declaration that it was realisable from the offerings to the idol and was recoverable from the successors in office of the defendant. The <ORG> below has allowed the former claim with a small reduction, the correctness of which is not questioned in appeal, but disallowed the latter; and the appeal is only against that part of the decision which relates to the declaration. The memorandum of appeal should therefore be held to be sufficiently stamped, if it bears the <ORG> fee stamp chargeable in a suit for a mere declaratory decree, that is, if it bears a stamp of Rs. 10 as provided by clause iii, Article 17 , Schedule II of the Act.

10. It has been contended that if the declaratory decree asked for is granted, it will necessarily carry with it some consequential relief; that is to say, as soon as the declaration is obtained, the plaintiffs will become entitled to realise their claim out of the offerings, so that it cannot be said to be a declaratory decree without consequential relief. But this contention is not sound. The correct view of the matter is that the declaratory decree results in consequential relief, not by its own force, but only by reason of such relief having already been granted.

11. Several cases were cited on each side during the argument, but only two of them can be said to have any bearing upon the question before us. These are : <NAME> v. <NAME> I.L.R. 10 Mad. 187 and <NAME> v. Balkrishna Janardan I.L.R. 10 Bom. 610. The first-mentioned case, <NAME> v. <NAME>, may in one sense be regarded as the converse of the present one. There the suit was based on a mortgage bond; the first <ORG> made a decree for payment of the money and for sale of the mortgaged property; some of the defendants appealed against the decree, in order, as the report says, "to exonerate the lands from liability for the amount decreed," and <ORG> held that the <ORG> fee chargeable on the memorandum of appeal was not Rs. 10, but an ad valorem fee on the amount of the decree. The case seems at first sight to favour the contention of the respondents before us; but when the ground of the decision is examined, it does not appear to be quite in point. For the learned Judges say: "The defendants appealed against so much of the decree as declared the liability of their property and in order to be released from the decree. The relief they sought was, therefore, not a mere declaratory decree, but to be released from the decree."

12. In the other case cited, <NAME> v. Balkrishna Janardan I.L.R. 10 Bom. 610, the suit was brought by a judgment-creditor to establish the right of his judgment-debtor to certain property and the liability of that property to attachment in execution of his decree, after the property had been released from attachment on the claim of a third party; and a Full Bench of <ORG> held that the proper stamp on the plaint was Rs. 10 under Schedule II, Article 17 , Clause (i) of the Court Pees Act. This too is not, therefore, a case quite in point.

13. The language of the Act not being' clear, and there being no case in point, we think the correct view of the law is that indicated above, as being the one most consonant to reason.

14. We shall now proceed to the determination, of the appeal and the cross-appeal, taking the appeal first and then the cross-appeal; and we shall consider the grounds urged in each in the order in which they have been stated above.

15. The first contention of the appellants, namely, that the <ORG> below ought to have declared that the amount decreed was realisable by the attachment of the charao or offerings, involves some of the most important questions raised and discussed in the argument. In support of this contention it is urged that the surplus of the offerings left after defraying the expenses of worship and certain other necessary expenses, such as those required for keeping the temple in proper order, belongs to the ojha or high priest; that the defendant was therefore competent to create a charge on such surplus by the ekrar on which this suit is based; and that the plaintiffs are entitled to the declaration asked for. And the right of the high' priest to the surplus of the offerings is sought to be based as well upon the general Hindu law as upon the special custom of the shrine. It is further urged that, even if the surplus of the offerings be not the property of the ojha, they are still chargeable by him with the maintenance of members of his family. The attempt made in the <ORG> below to support the plaintiffs' claim to a charge on the offerings, even if they are the property of the idol, on the ground of the charge being created for the benefit of the endowment, was not repeated here, evidently because the contention was, as shown in the judgment of the learned Subordinate Judge, utterly untenable. In dealing with the first ground of appeal, therefore, we may confine our attention to the two questions, whether by the general Hindu law the surplus of the offerings belongs to the high priest, and whether by the special custom of the shrine they belong to him or are chargeable by him with the maintenance of members of his family.

16. Notwithstanding the existence of numerous richly endowed Hindu shrines all over India from the earliest times, the Hindu law strictly so-called is, as Sir <NAME> complains (see his Hindu Law, Ed. of 1839, Vol. I, p. 32), meagre in its provisions relating to religious endowments, a fact which may perhaps be accounted for on the supposition that the high reputation for piety and purity of character justly enjoyed for the most part by the priestly classes of ancient India who had the management of the shrines, was deemed a sufficient safeguard against breach of duty, so as to render detailed rules of law to regulate their conduct unnecessary. The subject of religious endowments does not form one of the distinct topics of litigation enumerated by <NAME> (Chap. VIII, 3-6), and <NAME> (Introduction 16-19), and a few scattered texts here and there enjoining kings to establish and endow colleges of Brahmins, directing the consecration of tanks and other works of public utility, dwelling on the merits of religious gifts, and providing for the succession to religious devotees (see Yajnavalkya, I, 339; II, 132; Colebrooke's Digest, III, ii, 4, 6; <NAME>, IV, 226) appear to be all that is worth notice relating to the subject in the institutes of the early sages. In the later Commentaries and Digest there are, it is true, whole chapters devoted to religious gifts and endowments (see, for instance, Hemadri's Chaturvarga Chintamani, Danakhanda and Raghunandana's Digest, Matha Pratishtha Tattwa); but they relate mostly to matters of ritual and to the spiritual merit of different sorts of gifts. There is one passage in the last-mentioned work, namely, a text quoted from the Matsya Sukta, which has some bearing on the present question, and which runs thus:' Having made offerings to a god, the sacrificial fee also should be given to the god. The whole of that should (then) be given to a Brahmin, otherwise (it) is fruitless. [Raghunandana's Institutes, Ed. of 1834, Vol. II, p. 358.]

17. Relying upon this text and upon a remark of <NAME>, in which the learned author speaks of an idol as a being "whose essence is a text of Scripture" (see Colebrooke's Digest, Book V, Ch. I, 2 Commentary, Madras Ed., Vol. II, p. 191), the learned vakils for the appellants contend that offerings made to an idol are only nominally the idol's property, but belong really to the officiating priest. It is argued that according to true Hindu notions, an idol is only an emblem of God, and offerings made to an idol are intended not for the use of the idol, that is a mere symbol, but for the use of God's creatures in general, and of Brahmins or priests in particular as being the most meritorious among them. Whatever weight an argument like this may be entitled to in a purely religious or metaphysical discussion, it cannot, we think, prevail in its broad generality in <ORG> at the present day. Decisions too clear and authoritative to be doubted or disregarded have repeatedly laid down that an idol in Hindu law is capable of holding property, and that property dedicated to an idol belongs to an idol and not to the sebait, or priest. See <NAME> v. <NAME> 13 W.R. P.C. 18 : 13 Moore I.A. 270, and <NAME> v. <NAME> 14 B.L.R. 450 : 23 W.R. 253 : L.R. 2 I.A. 145.

18. If it were necessary to give reasons in favour of a view so amply supported by authority, we should add that the opinion of <NAME> goes merely to show that an idol can be the owner of property only in a figurative sense, possession being held by a manager or trustee, and that dedication of property to an idol is only a mode of creating a trust for religious purposes in perpetuity, which is allowed by law [see <NAME> v. <NAME> 10 B.L.R. 19 : 17 W.R. 41 : 14 Moore I.A. 289]. And as for the text cited above, though it requires the appropriation by a Brahmin of offerings made to an idol, it does not show that the Brahmin intended is the priest attending the idol. What is offered to an idol is required to be devoted to the use of a Brahmin on account of his generally having great religious merit; but the Hindu law regards a priest attending an idol as a Brahmin of a comparatively lower order of merit (see Manu, III, 152; Vishnu, LXXXII, 8). Where an idol is set up temporarily for worship, or where the offerings are of a perishable nature, such as articles of food, the priest in attendance, as the nearest Brahmin available, generally appropriates the offerings; and the same is the case where the idol itself is the private property of the priest. But where, as in this case, the idol is an ancient one permanently established for public worship, and the offerings are generally of a more or less permanent character, being coins and other metallic articles, in the absence of any custom or express declaration by the donor to the contrary, they are, as they ought to be, taken to be intended to contribute to the maintenance of the shrine with all its rites, ceremonies and charities, and not to become the personal property of the priest. However much a Hindu votary may wish that his offerings to public shrines should ultimately go to the use of meritorious Brahmins", he can never be supposed to intend, nor does the Hindu law anywhere allow, that they should become the property of the priest, to be squandered by him or devoted to purposes foreign to the endowment. This view is quite in accord with that expressed by <ORG> in <CITATION> . 12 Bom. 247.

19. We are, therefore, clearly of opinion that there, is nothing in the general Hindu law to support the appellants' contention;

20. Let us next examine how far the special custom of this shrine helps the appellants. It is admitted by the plaintiff <NAME> in his deposition, and it could not very well have been denied upon the evidence adduced by the plaintiffs themselves (see <ORG> letter of 1791, Ex. 4, that of 1822, Ex. 3, and the Assistant Commissioner's Report of 1860, Ex, 7) that the temple of Baidyanatb is a public place of worship. But it is urged that by custom the surplus of the offerings made to the idol after defraying the expenses of worship belong to the ojha. The custom is said to be traceable in its origin to the fact that the temple was either built by the founder of the family of the ojhas or made over to him by the king of Gidhaur who had built it; and to the further fact that the right to two-thirds of the offerings which was formerly claimed and enjoyed by the Rajas of Birbhum and afterwards in succession to them by the British <ORG>, was subsequently relinquished by the latter in favour of the high priest in 1791. The custom is said to be proved by evidence showing the mode in which the offerings have been appropriated; and, lastly, it is said to have been recognised by <ORG>.

21. The early history of the temple is lost in remote antiquity. The Siva Purana and the Padma Purana, of which extracts, with translations, are given in Dr. <NAME>'s paper on Deoghar in the Journal of the Asiatic Society of Bengal, Vol. LII, p. 164, trace the origin of the temple to the Treta Yuga, the age of the events narrated in the Ramayana. Side by side with the Hindu traditions there is a Santal tradition of the origin of the temple, given by Sir <NAME> (see the Annals of Rural Bengal, p. 191; Statistical Account of Bengal, Vol. XIV, p. 323). But these materials afford no evidence as to when and by whom the idol was established or the temple was built. The only evidence adduced to show that the temple was either built by some ancestor of the ojhas or was made over to him by the king of Gidhaur consists of the Assistant Commissioner's Report of 1860, Ex. 7, and an attested copy of a deposition of the defendant given in a former suit. The report, however, considering its recent date, and its admitted basis which is popular tradition, apparently unverified by any reference to the inscriptions on which the tradition itself is based, can scarcely be of much value, while the inference drawn from the inscriptions by the scholar and antiquarian, Dr. <NAME> (see his paper just referred to) is to the effect that it was not the temple, but only the portico that was built by the ojha or the king of Gidhaur. The copy of the defendant's former depositions is no doubt evidence against him, but the statements there made are mostly based upon hearsay and upon perusal of a copy of a sanad. The non-production of the original sanad is certainly matter for adverse comment. But considering the whole of the evidence adduced on the point, and all the circumstances connected with it, we do not think there are sufficient materials upon which it can be safely affirmed that the temple, as distinguished from the portico, was either built by some ancestor of the ojhas, or was made over to him by some one who had built it. It is quite probable that some semi independent <NAME> of Gidhaur, within whose territory the temple was situate, made it over to one of the ancestors of the present ojha. But though that may account for the right to the managership of the temple being vested in the family of the present ojha it can afford no safe basis for any inference that the offerings made to the shrine which has been in existence as a place of public worship from before became the private property of the priest. Then as to the effect of the relinquishment by <ORG> of its two-thirds share in the offerings, though there can be little doubt that this share used to be taken by the <NAME>s of Birbhum and by the British <ORG>, it is not quite clear in what right it was first claimed by the former. But the <ORG> letter of 1791, Ex. 4, by which the right was relinquished, and which is headed "Revenue Department, sayer," indicates that it was claimed as a sayer or tax (something like what is referred to in Regulation XXVII of 1793). And, though the letter says that the gossains or priests "by whom the offerings had been hitherto received" are "to enjoy the whole" under certain conditions, a statement on which the learned vakils for the appellants lay great stress, yet having regard to the conditions mentioned in the letter, and more fully set out in the 7th paragraph of the Assistant Commissioner's Report of 1860, Ex. 7, filed by the plaintiffs themselves, we think it clear that it was never the intention of <ORG> that the offerings should thenceforth become the property of the ojha. It was argued that the offerings were intended to become the property of the high priest, subject only to certain trusts. But if that were so, there would have been no necessity for his submitting accounts as required by the 9th condition set forth in the last-mentioned document, the balance left after defraying all necessary expenses being his property. Again, the trusts imposed are by no means certain; they are of a most indefinite character, and the feeding of the poor and the infirm required by the 10th condition might at any time exhaust the whole of the offerings. The conditions imposed are, in our opinion, incompatible with the supposition that the offerings were intended to belong to the ojha. To our minds they clearly indicate that the ojha was regarded only as a trustee or manager of the shrine and of its proceeds, including the offerings; and this view is fully confirmed by the <ORG>'s letter of the 20th September 1822, Ex. 5, filed by the plaintiffs, in the concluding paragraph of which the <ORG> say:

With this view we propose requiring from the ojha who may be eventually nominated such periodical accounts as will be calculated to supply the necessary information respecting the extent and nature of every source of receipt and object of disbursement, and we believe that with the exercise of an active superintendence on the part of the local agents, it will be practicable so far to control the conduct of the ojha in the administration of the temporal duties of his office, as will preclude the possibility of any extensive misapplication of the funds committed to his charge.

22. The letter of the Local Agent to <ORG>, dated the 23rd February 1825, embodied in the proceedings of the <ORG>, dated the 1st March following, and Exhibit F, support the same view.

23. It is argued for the appellants that the mode in which the offerings have all along been appropriated by the ojha proves that they belong to him. On the other side, it is contended that such appropriation, even if established, will only show abuse of trust on the part of the ojha, but instances of former abuse of trust cannot be pleaded against a trustee who is now seeking to prevent a repetition of abuse; and the case of <NAME> v. <NAME> 10 B.L.R. 19 : 17 W.R. 41 : 14 Moore I.A. 289 is cited in support of this contention. Though that is undoubtedly so, when the trust is admitted or proved, yet, when the question to be determined is whether certain property is trust property, or whether it belongs to the alleged trustee in his own right, instances of the appropriation of such property by the alleged trustee to his own use, if they are numerous and extend far back into the past in a continuous series, will be good evidence of his right; but if the instances are only recent or are few and far between, they are not likely to be of much value, and may be treated merely as instances of abuse of trust. Now after carefully considering the evidence adduced in this case we must say that the instances of appropriation proved are of the latter description and not of the former. The instances given by the witnesses as well as those given in the documents are for the most part recent, and they are few and far between. Moreover, some of the instances deposed to by the witnesses are, when examined, found not to be instances at all of unauthorized appropriation of the offerings by the ojha to his own purposes. Thus witness No. 3, <NAME>, admits in cross-examination (see page 27 of the Paper Book) that the dues of the creditors about whose decrees he has spoken, were on account of the worship expenses of the mat; while the expenses of sradhs and of other ceremonies in the family of the ojha, which the ojha is said to have supplied out of the offerings, may be treated as legitimate expenses which he was authorized to make out of the temple funds just as he is authorized to maintain himself out of the same. Then, again, part of the evidence (see the depositions of <NAME>, witness No. 2, and of <NAME> witness No. 6) proves too much, when it seeks to make out that no distinction is made between the offerings and the income of property which is admittedly debutter.

24. It remains to consider the effect of the decisions referred to, in which the ojha's right to the offerings is said to have been recognised. These are certain decisions of the civil Courts passed in different stages of a suit for maintenance, somewhat similar to the present, brought by one <NAME> in the year 1848 against <NAME>, the predecessor in office of the present ojha. They cannot operate by way of res judicata, not being judgments inter partes, but they are evidence under Section 13 of the Evidence Act, upon the present question, which is one as to the existence of a right by custom; and they are certainly entitled to careful consideration. The most important of these decisions is that of the Sudder Dewanny Adalut of Calcutta, dated the 7th of June 1856, which is reported in the Sudder Dewanny Adalut Reports of 1856, page 512, and of which a certified copy is filed with the record of this case.

25. In that decision, in dealing with the third issue, which ran in these words-" The income of Baijnath has been specially assigned for the purposes of the temple. Can it be alienated or not the learned Judges of <ORG> say: "The objection raised to the third issue of appellant is beside the question before us, for the agreement upon which this suit is based is altogether silent regarding the source whence the yearly payments are to be made; but granted for argument's sake that it were otherwise, we- hold the objection untenable, the precedents of this Court having clearly established that the surplus of the income arising from offerings made at temples may, after all proper and necessary expenses have been defrayed, be divided amongst the parties interested in any mode that may be agreed to amongst themselves."

26. This passage of the judgment clearly shows that the present question did not properly arise in the former suit, and what was said with reference to it may therefore be treated as an obiter dictum. Moreover, what was said by the learned Judges has no reference to any special custom of the temple of Baidyanath, but refers to offerings made at temples generally. With all respect for the learned Judges, we must say that to the broad proposition of law thus laid down by them, we are unable to assent. Where any property is not wholly debutter, but is only charged with certain religious trusts, there the surplus which remains after the performance of the trusts is no doubt attachable for the debts of the person beneficially entitled to the surplus. <CITATION> . 5 Cal. 438 : L.R. 6 I.A. 182. But that is not the case before us. Here the offerings are admittedly made to the idol (see the deposition of the plaintiff <NAME>, page 16 of the Paper Book). Their very name charao shows that they are placed either actually or symbolically on the head of the idol when the offering is made. The purposes, again, to which they are required to be appropriated in the first instance, that is, the trusts with which they are said to be charged, are of an indefinite character and may exhaust them completely. And the only definite right which the ojha seems to have in them is to maintain himself and the dependent members of his family out of them.

27. Such being the case, it would be reversing the order of things to say that the offerings constitute the property of the ojha subject to certain religious trusts, when the correct view to take is, that they constitute the property of the idol subject to certain rights of the ojha. When some of the most beneficial objects of the endowment, such as the feeding of the poor and the infirm (see Clause 10, para. 7 of plaintiffs' Ex. 7) are of an indefinite extent, to hold that the ojha is entitled to the surplus of the offerings, would be to place the trustee or manager in a position to cut down the indefinite expenses to the lowest possible limits for his own individual benefit. Such a view can never be sound.

28. There are two important facts proved in the case, which make the correctness of the view we take clear beyond doubt. One of these is the fact that the ojha, or high priest of <ORG> is required to be above a certain age and to lead an ascetic life. This is proved by the plaintiffs' witness <NAME> and by their Exhibit 7, the Report of the Assistant Commissioner, dated the 4th May 1860 (see para. 7, Clause 12). The other is the fact proved by the deposition of the plaintiff <NAME> that, besides making their offerings to the idol, pilgrims pay pranamis or fees to the ojha. The condition imposed on the high priest that he should lead an ascetic life implies that his temporal wants must be of a very limited nature, so that he can have no occasion for misappropriating the funds of the shrine; and the payment of separate fees to him shows that the offerings to the idol are not intended to be appropriated by him.

29. Last of all it was urged in support of the plaintiffs' right to enforce the charge claimed that, even if the surplus of the offerings do not belong to the ojha, they are still chargeable by him with the maintenance of members of his family; and para. 4 of Exhibit 3 was relied upon. Conceding that the humane provisions of the Hindu law relating to maintenance would authorize the ojha to maintain out of the temple funds certain of his relations in the same way as he is authorized to maintain himself, they can only be those dependent and helpless members of his family whom he is under that law bound to maintain; and clearly the plaintiffs in this case do not come under that description. Nor can Exhibit 3, which merely contains a special recommendation with reference to a particular case, help the plaintiff's much.

30. For all these reasons we are of opinion that the first ground of appeal is not tenable upon any view of the case.

31. The consideration of the second ground need not detain us long. The plaintiffs admit in their plaint (para. 5) that the office of ojha or high priest is elective, though the election is confined within their family circle. It is true that the defendant denies this in his written statement; but the evidence adduced by the plaintiffs (see the deposition of the plaintiff <NAME> and of their witness <NAME>) shows that the office is not a strictly hereditary one. Their documentary evidence leaves the matter to some extent in uncertainty. The earlier proceedings of <ORG> show that the <ORG> exercised some control over the appointment of successors to the office, though they admitted the office to be as a rule hereditary, while in their later proceedings they disclaim all authority to control the succession. But whether the office is elective or hereditary, no holder of it can bind his successors in office by any act, unless it is for the benefit of the endowment; and it is clear, as has been shown in the judgment of the <ORG> below, that the ekrar upon which the plaintiffs base their claim cannot be said to have been entered into for the benefit of the endowment. The plaintiffs cannot, therefore, have any right to recover the money decreed from the defendant's successors in office.

32. The third ground of appeal is clearly untenable. A former abuse of trust, such as is shown by the stipulation in the ekrar charging the offerings with the allowance to the plaintiffs, cannot be set up against a party who seeks to prevent repetition of such abuse in future. The case of <NAME> v. <NAME> 10 B.L.R. 19 : 17 W.R. 41 : 14 Moore I.A. 289 is conclusive authority on the point.

33. The grounds urged before us therefore all fail, and the appeal must consequently be dismissed with costs.

34. Turning now to the cross-appeal, we think the first ground ought to succeed to this extent, namely, that the claim in respect of the time preceding the last six years before the date of institution of the suit ought to be disallowed, as barred by limitation. The suit being based upon the ekrarnama of the defendant which is a contract in writing registered, the period of limitation applicable to it is six years under Article 116 , Schedule II of the Limitation Act [see Nobocoomar Mookhopadhya v. Sent Mullick I.L.R. 6 Cal. 94]. The <ORG> below has held that the allowance claimed being one for maintenance, the period of limitation applicable to it is twelve years. The learned Subordinate Judge evidently thinks that Articles 128 and 129 govern the case. This view is clearly wrong. Those Articles, in our opinion, apply only to cases in which the right of maintenance is based upon the Hindu law. They can have no application to a case like the present in which the right is based entirely upon a contract, merely because the persons claiming under the contract are Hindus. The application of those two Articles depends not upon the nationality of the plaintiff, but upon the nature of his right; and the words by a Hindu "used in the Articles must be taken to mean" by a person claiming under the Hindu law." If it were otherwise, and if these words were taken literally, it would lead to this anomalous result, that a Hindu servant of a Christian or a Mahomedan, to whom his master may have granted maintenance by a deed in consideration of his past services, would be entitled to twelve years limitation in respect of his claim, while a servant of the master's own nationality and creed would be entitled only to six years or three years in respect of a similar claim, according as the deed in his favour was or was not registered. This could never have been intended. As a further reason for his decision that no pact of the claim is barred, the learned Subordinate Judge adds that the plaintiffs have the right to appropriate the payment in satisfaction of the earlier arrears; that they have in fact made such appropriation in the account annexed to the plaint; and that even if they have not done so, the <ORG> can allow such appropriation to be made now. This view is not, in our opinion, correct. Granting that the conditions under which the plaintiffs are entitled under Section 60 of the Contract Act to appropriate payments to the discharge of the earlier debts, were satisfied, we do not think that the account referred to makes any such appropriation. It is a running account in which every year the amount due at the end of the last preceding year is added to the amount due for the year, and the payment made during the year is deducted from the same' without any specification as to whether the payment is deducted from the former amount or the latter; and the payment cannot now be applied under Section 61 of that Act to the discharge of earlier arrears, which are now barred by limitation. Practically the difference is not very great. The suit was brought on the 16th of January 1891, corresponding to some time in Magh 1297, the allowance is an annual one; and six years being the period of limitation, the claims for the years beginning with 1291 are within time. The only part of the claim that is barred is the balance due at the end of 1290, which according to the account appended to the decree is Rs. 1,064-8.

35. With reference to the second ground of cross-appeal, it is argued in the first place that as the <ORG> in question contains no personal covenant to pay, but only creates a charge on the offerings which is invalid, no personal decree ought to have been made; and in support of this argument the case of <NAME> v. <NAME> I.L.R. 10 Cal. 740 is cited. It is next contended that, even if there was a personal contract, it cannot be enforced, as there was no valid and legal consideration for the contract. On the other side it is urged that it is not open to the defendant now to deny his personal liability under the <ORG>, when in paragraph 13 of his written statement he admitted such liability, and merely questioned the correctness of the plaintiffs' account and pleaded payment in reduction of the claim. We are of opinion that the admission of the defendant should be taken in its entirety, and that it is open to the defendant to contest his liability for any sum in excess of that admitted to be due, upon any ground that he may think fit to urge, provided no new case is made in appeal, and the other side is not taken by surprise. We shall therefore examine the argument advanced.

36. Upon the first branch of the argument, it is enough to say that the question is one of construction of the ekrar; that the case cited is clearly distinguishable from the present, the documents in the two cases being very different from one another in their language; and that the ekrar upon which the suit is based contains in our opinion a personal contract to pay, when the defendant in that document says to the plaintiffs: "You and your descendants shall from generation to generation continue to get from year to year the said sum of Rs. 2,400 from me and my representatives, &c.

37. In support of the second branch of the argument the preamble of the <ORG> is relied upon, and it is urged that upon the death of <NAME>, the last ojha, either the defendant was entitled to the office, in which case the plaintiffs gave up nothing, and so there was no consideration for the <ORG>, or he was not, and one of the plaintiffs was, in which case it was a sale of the office or a bargaining for it, and the consideration was illegal, such sale of, or bargaining for, a public office like that of the high priest of a public shrine being opposed to public policy. And <ORG> of Contracts (5th edition), page 313; Leake's Law of Contracts (3rd edition), page 624, and the cases of <NAME> v. <NAME> alias Raja Babu 7 W.R. 266, <NAME> v. <NAME>. 81, <NAME> v. Anantha Bhatta I.L.R. 4 Mad. 391, <NAME> v. Dora Sami Gurukal I.L.R. 6 Mad. 76, <NAME> v. Rapi Varma Kunhi Kutty I.L.R. 1 Mad. 235 are relied upon as authorities. On the other side are cited the cases of <NAME> v. Pranshankar I.L.R. 6 Bom. 298 and <NAME> v. Sitaram Ganesh 6 Bom. A.C. 250.

38. Having regard to the facts of this case, we are of opinion that this contention is not valid. The ekrar (Ex. 2) no doubt recites that both the plaintiffs and the defendant tried to obtain the post of the high priest on the death of <NAME>, and that this dispute concerning the succession was settled by that document; it also recites that <NAME> had by an ekrar dated the 24th Baisakh 1271 granted to the plaintiffs and their heirs in succession an annuity of Rs. 2,400 for their maintenance. The defendant <NAME> is the eldest son of <NAME>, who was the eldest son of the late ojha <NAME>, but who died before his father; and the plaintiff <NAME> appears to be the eldest surviving son of <NAME>. The earlier letters of the <ORG> and of <ORG> (see Exhibits 3, 5 and 6) show that succession to the office of ojha or high priest, though generally hereditary, is still governed by the elective principle to this extent that the priests or. members of the family of the ojhas have a voice in the determination of the question whether the person entitled to succeed by inheritance is also qualified by his age (which is required to be above forty years) and his character; and though in their later communications, that is, those of 1839 (see Exhibits 19 and 20) they withdraw their control over the appointment of the ojha, still they regarded the succession as partially elective, when they said "that the priests of the temple should be left at liberty to choose their own superior without restriction of age or other qualification." Moreover, it had never been authoritatively settled that the succession to the office of ojha was regulated solely by the principle of lineal primogeniture as contended by the defendant. In that state of things it is impossible to say that at the date of the ekrar there could not have been any bond fide dispute as to the right to succeed, and that the plaintiffs did not abandon a bond fide claim. And if that was so, it cannot be said that the ekrar was without consideration. (See Pollock's Principles of Contracts, 5th Edition (page 181), and <NAME> v. <ORG> L.R. 32 Ch. D. 266.

39. Then as regards the contention that the consideration, if there was any, was illegal as it involved the sale of, or bargaining for, a public office, we are of opinion that the English cases relied upon and referred to in <NAME>'s Principles of Contracts, p. 313, and in Leake's Law of Contract, p. 624 are inapplicable to this case. They are based either upon the provisions of particular statutes, or upon considerations of public policy inapplicable to an agreement like the one embodied in the ekrar, by which parties having bond fide claims to a priestly office effected a compromise of their disputed civil rights. In two of these cases again, Parsons v. <NAME> 1 H.B. 322 and <NAME> v. <NAME> 4 B. and C. 319, the decision against the agreement is based upon the ground of the agreement involving a fraud (upon the public in the first-mentioned case and upon the individual in whose gift the office was in the second).,

40. The Indian cases cited are somewhat in conflict with one another, but they do not really affect the question as to the validity of the agreement upon which this suit is based. Juggernath v. Kishen Pershad 7 W.R. 266 only decides that the judgment-debtor's right as sebait cannot be sold in execution of a decree. In <NAME> v. Chanchal Bam I.L.R. 4 All. 81, the same rule is laid down, with a qualification, however, which favours the appellants. The learned Judges say: "We are of opinion in default of any proof to the contrary that the right of managing the temple, of officiating at the worship conducted in it, and of receiving the offerings at the shrine cannot legally pass outside family of the trustee, <NAME>, until absolute failure of succession in his family." In <NAME> v. Anantha Bhatta I.L.R. 4 Mad. 391, and <CITATION> . 6 Mad. 76, the sale of a priestly office for the pecuniary benefit of the sebaitfia declared to be invalid, and in <NAME> v. Ravi Varma Kunhi Kutty I.L.R. 1 Mad. 235, <ORG> held that a custom allowing the sale of the office of trustees for the pecuniary advantage of the trustees, even if it was established, would be bad in law. On the other hand, the case of <NAME> v. Pranshanker I.L.R. 6 Bom. 298, while affirming the invalidity of an alienation of the office of sebait to a stranger, upholds an alienation made in favour of a member of the founder's family standing in the line of succession; and to the same effect is the case of <NAME> v. Sitaram Ganesh 6 Bom. H.C. 250.

41. These decisions, so far as they relate to public offices, are based more or less upon one of two principles, namely, first, that the interests of the public might suffer, if bargains relating to public offices are upheld, as their effect is to prevent such offices being filled by the best available persons; and, second, that no such office should be treated as the private property of any incumbent, and as such capable of being sold by him or of being brought to sale in execution of a decree against him, as such a sale might lead to public inconvenience. The agreement before us obviously does not infringe this second principle, as there was no sale of the office of <ORG> here. As far as the first-mentioned principle goes, that can hold good only in those cases in which the office is of such a nature that no one has more claim to it than what his personal fitness gives him, and no one has any right to question in <ORG> the correctness of the decision of the person or persons, in whose gift the office is. When, however, as in the case before us, the only persons who can have any claim to the office are members of a family group, and the nature of the office is such that claims to it must be ultimately determined by the decision of <ORG>, and bond fide claimants to the office compromise their claims by an agreement for a pecuniary consideration, the propriety of the agreement has to be judged of not merely with reference to the above-mentioned principles, but with reference to various other considerations besides. In fact, conflicting considerations arise in such cases. On the one hand, it may be said that the rights of the rival claimant should be determined by the <ORG>, so that the office may be held by the person found best entitled to it. On the other hand, it is to be borne in mind that litigation concerning succession to a public office always involves a certain amount of inconvenience to the public and some waste of the funds of the endowment to which the office appertains; and where the qualifications of the rival claimants are evenly balanced, so far as the public are concerned, it would conduce more to the interests of the public by allowing a compromise than by prohibiting it, provided the nature of the compromise is such that it does not interfere with those interests. We are of opinion that in cases like these, it is not possible to lay down any hard and fast rule of law which can be of general application. Each case ought to be determined upon its own facts. And having regard to the nature of the office in this case, to the nature of the dispute relating to it, and to the nature of the compromise effected, we are not prepared to say that the agreement in question is invalid by reason of its being opposed to public policy.

42. It remains only to consider the last ground of cross-appeal, namely, that relating to the claim for interest. Having regard to the terms of the ekrar, we are of opinion that interest has been rightly allowed. The claim is one for a certain sum, payable by virtue of a written instrument at a time certain (that is at the end of each Bengali year), within the meaning of Act XXXII of 1839; and the rate at which interest has been awarded, namely, 12 per cent, per annum, may fairly be regarded as not exceeding the current rate, that being the rate allowed by the <ORG> in certain oases (Act VIII of 1885, Section 67 ).

43. The result then is, that the appeal, is dismissed with costs and the cross-appeal allowed with proportionate costs in both <ORG>s to this extent, namely, that the sum of Rs. 1,064-8, being the portion of the amount decreed that is barred by limitation, shall be deducted from that amount; and the appellants are entitled to costs in this cross-appeal in proportion to the amount disallowed; but the order made in the cross-appeal will be subject to the condition that the respondent shall pay within one month from this date the additional <ORG> fee payable on the memorandum of cross-appeal under Section 16 of the <ORG> Fees Act, that is, the sum of Rs. 335, and if this sum is not paid as directed, the cross-appeal shall stand dismissed with costs. Except as indicated above, the decree of the <ORG> below shall stand.