PETITIONER: COMMISSIONER OF SALES TAX U.P. Vs. RESPONDENT: M/S. S. N. BROTHERS, KANPUR DATE OF JUDGMENT02/11/1972 BENCH: DUA, I.D. BENCH: DUA, I.D. REDDY, P. JAGANMOHAN CITATION: 1973 AIR 78 1973 SCR (2) 852 1973 SCC (3) 496 CITATOR INFO : RF 1977 SC 132 (15) D 1977 SC 597 (41) R 1988 SC2176 (4) R 1988 SC2229 (9) RF 1990 SC1579 (44) RF 1991 SC 494 (3) ACT: U.P. Sales Tax Act (15 of 1948) s. 3 and Notification under s. 3A 'Food colors' if 'dyes and colors' and 'Syrup essences' if 'scents and perfumes' HEADNOTE: Item 10 of the notification under s. 3A of U.P. Sales-tax Act, 1948, referred to 'dyes and colors' and compositions thereof, and item 37 to 'scents and perfumes'. The respondent (dealer) imported from outside U.P., food colors and syrup essences. The appellant held that the food colors fell under item 10 of the notification and syrup essences under item 37 of the notification, and that they should be taxed at six paise per rupee under the Act. The dealer contended that the tax on food colors and syrup essences should be at the rate of two paise per rupee as unclassified goods under s.3 of the Act. <ORG>, in reference, agreed with the dealer's contention. Dismissing the appeal to this Court, HELD : The words 'dyes and colors' and the words 'scent and perfumes' have to be construed in their context and in the sense as ordinarily understood and attributed to these words by people usually conversant with and dealing in such goods. Similarly, the words 'food colors' and 'syrup essences', which are descriptive of the class of goods, the sales of which are to be taxed under the Act, have to be construed in the sense in which they are popularly understood by those who deal in them and who purchase and use them. 'Food colors' and 'syrup essences' are edible goods, whereas 'dyes and colors' and 'scents and perfumes', as specified in entries 10 and 37, prima facie do not connote that they are edible goods. The scheme of the list in the notification also suggests that, apart from undoubted edible goods, in cases where the import of the specified goods is wide enough to include both edible and non-edible categories, then the intention has been clearly expressed whether or not to in- clude edible goods. Therefore, entries 10 and 37 are not intended to extend to edible colors like 'food colors' and edible essences like 'Syrup essences'. In any event, the view taken by <ORG> is not so grossly erroneous that it should be interfered with in a special leave appeal under Art. 136. [856 F-G; 858 D-E, F-H; 859 <CITATION> tax  26 S.T.C. 330, <NAME> v. Assistant Sales Tax Officer, Akola,  12 S.T.C. 286, Commissioner of Sales Tax. <CITATION>  19 S.T.C. 469 and <CITATION> ,  28 S.T.C. 325 referred to. <CITATION> ,  21 S.T.C. 367 approved. JUDGMENT:

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2088 of 1969.

Appeal by special leave from the judgment and order, dated April 3, 1969 of <ORG> in S. Y. R. No. 306 of 1967.

<NAME> and <NAME> for the appellants. <NAME>, <NAME> and <NAME> for the respondents. The Judgment of the Court was delivered by DUA, J.-This appeal by the Commissioner of Sales Tax, Uttar Pradesh is by special leave and is directed against the judgment of <ORG> answering the following question in the negative in favour of the respondent (hereinafter called the dealer) and against the Commissioner of Sales Tax, appellant "Whether the food color and essence are under the circumstances items to be taxed under section 3A within the notification No. ST- 905/X dated March 31, 1956 ?"

The dealer carries on the business, inter alia, of selling food colors and syrup essences. The dealer also carries on the business of petroleum jelly but we are not concerned with that item in this appeal nor are we concerned with the sales of imported scents and perfumes which, according to the order of the <ORG>, were separately shown in the statement filed by the dealer, ,during the assessment proceedings for the year 1960-61. For the said year the <ORG> taxed food colors and syrup essences imported by the dealer from outside Uttar Pradesh under s. 3A of U.P. Sales Tax Act, 15 of 1948 (hereinafter called the Act) treating them as imported colors and perfumes. The figures of the dealer's trading account were accepted by the <ORG>. The dealer, according to whom, food colors and syrup essences being unclassified goods were taxable under s. 3 and not under s. 3A of the Act, unsuccessfully appealed against the order of the <ORG> to the Assistant Commissioner (Judicial); II Sales Tax, Kanpur. Further revision to <ORG>, Lucknow also failed. It may, however, be pointed out that for the assessment year 1957-58 <ORG> had, in disagreement with the assessing officer, held food colors and essences of syrup to be unclassified items and had granted the relief claimed by the dealer. Against that decision of <ORG> the <ORG> preferred a revision to <ORG> (Revision), Sales Tax. Both these revisions, by the <ORG> with respect to the assessment year 1957- 58 and by the dealer with respect to the assessment year 1960-61 were heard together and disposed of by the common order dated November 19, 1965. The dealer's application for reference was, however, allowed and the learned Judge (Revisions). Sales Tax referred for determination of <ORG> "he question reproduced in the beginning of this Judgment. <ORG> agreed with the dealer's contention and held food colors and syrup essences not to fall within the entries at items nos. 10 and 37 of the Notification under S. 3A of the Act. The reference was accordingly answered in the negative and against the <ORG>. The only question which now' falls for determination is the one referred to <ORG> and which has already been reproduced. There is no dispute about the turnover. The dealer claims that on imported food colors and syrup essences the rate of tax should be 2 nP. per rupee as unclassified goods under S. 3, whereas according to the Commissioner the tax should be 6 nP. per rupee under s. 3A of the Act. Section 3 provides for liability to tax under the Act whereas section 3A, which was inserted by U.P. Act 25 of 1948 and has thereafter been amended from time to time, deals with single point taxation. Section 3A reads :

"3-A. Single point taxation : (1) Notwithstanding anything contained in Section 3 , <ORG> may, by notification in the official Gazette, declare that the turnover in respect of any goods or class of goods shall not be liable to tax except at such single point in the series of sales by successive dealers as <ORG> may specify.

(2) If <ORG> makes a declaration under sub-section (1), it may further declare that the turnover in respect of such goods shall be liable to tax at such rate not exceeding ten naya paise per rupee as may be specified.

(3) Every notification made under this section shall be laid before <ORG> as soon as may be after it is made and if a resolution amending or modifying it is passed by the <ORG> within the session in which it is laid, it shall, from the date of passing of the resolution, be amended or modified accordingly but without prejudice to the validity of anything previously done or of any liability incurred or assessment made."

On March 31, 1955 the Governor of Uttar Pradesh issued a notification in exercise of the powers conferred by s. 3A of the Act. That notification so far as relevant for our purpose reads :

"Notification No. ST-905/X dated 31st March, 1955.

In exercise of the powers conferred by section 3A of the U.P. Sales Tax Act, 1948 as amended from time to time and in supersession of all previous Notifications on the subject, the Governor of Uttar Pradesh is hereby pleased to declare that the turnover in respect of the good,, specified in the List below shall not with effect from April 1, 1956, be liable to tax "cept-(a) in the case of goods imported from outside Uttar Pradesh at the, point of sale by the importer; and

(b) in the case of goods manufactured in Uttar Pradesh at the point of sale by the manufacturer; and the Governor is further pleased to declare that such turnover shall with effect from the said date be taxed at the rate of one anna per rupee.

LIST

10. Dyes and colors and compositions thereof.

37. Scents and perfumes.

The narrow point requiring decision is whether good colors and syrup essences imported by the dealer from outside U.P. fall within the entries 10 and 37 respectively. If they do, then the appeal of the <ORG> has to succeed and if they do not then the appeal must fail. As noticed earlier <ORG> has in the impugned judgment, in disagreement with the view taken by the Sales Tax Officer, the Assistant Commissioner (Judicial) and the Judge (Revisions), Sales Tax, held that the food colors and essences do not fall in the entries at items 10 and 37 of the Notification. This is how <ORG> has dealt with the point in controversy:--

"The notification with which we are concerned in the instant case is notification no. ST- 905/1 dated March 31, 1956. Item nos. 10 and 37 of that notification read as follows : '10. Dyes and colors and composition thereof.

37. Scents and perfumes.' The case of Commissioner of Sales Tax is that food colors would fall under item no. 10 i.e., 'dyes and colors and composition thereof' and essence would fall in the entry given in item no. 37 i.e., 'scents and perfumes'. Food colors are edible, articles. The expression 'dyes and colors and composition thereof' does not relate to item of food but only to coloring and dyeing material i.e., material for color washing or color painting o r dyeing of fabrics. In our opinion, it stands in contradistinction to bleaching material. Similarly, the entry at item no 37 relates to articles which cater to the smelling sense i.e., those which appeal to nose. Essence is a flavoring material and its function is to add flavor to the food i.e., to make it more palatable. It appeals to the tongue or to the palate. By scents and per-fumes is meant articles of perfumery. In our opinion.

therefore, the food colors and essences would not fall in the entries at items nos. 10 and 37 of the notification aforesaid. In our opinion they could not be taxed under section 3A but under section 3 of the Act."

<NAME>, learned counsel for the appellant, assailed the reasoning and approach of <ORG>. According to him the words "dyes and colors" in entry no. 10 of the List in the Notification in question and the words "scents and perfumes" in entry no. 37 of the said List are unqualified and there being no limitation discernible on their plain and general meaning, they must be held to be wide enough to cover 'food colors' and 'syrup essences'. In seeking support for this submission reference was made to the Random House Dictionary of the English Language (prepared in U.S.A.) for ascertaining the meanings of the words " color" (color, as spelt in this dictionary), "dye" and "essence", as also to Encyclopedia Britannia Vols. 8 & 17 and Corpus Juris Secunduin, Vols. 28 and 70 for the same purpose. Strong reliance was placed on the decision of this Court in <ORG> v. <ORG>) in which the word "perfume" was held to include "dhoop" and "dhoop batti". The word "perfume", it may be recalled occurs in the entry no. 37 of the List in the Notification in question.

In our opinion the Random House Dictionary cannot serve as a safe guide in construing the words used in the List in the Notification in question for the purpose of deciding whether or not the words used in entries nos. 10 and 37 cover food colors and syrup essences : indeed this Dictionary is apt to be a somewhat delusive guide in understanding the meanings of the words and expressions with which we are concerned in the context in which they are used. This Dictionary gives all the different shades of meanings attributable to the words referred but that is hardly helpful in solving the problem raised in the present controversy. The words- "dyes and colors" used in entry no. 10 and the words "scents and perfumes" used in entry no. 37 have to be construed in their own context and in the sense, as ordinarily understood and attributed to these words by people usually conversant with and dealing in such goods. Similarly the words "food colors" and "syrup essences" which are descriptive of the class of goods the sales of which are to be taxed under the Act have to be construed in the sense, in which they are popularly understood by those who deal in them and who purchase and use them. The respondent's learned counsel has in support of this view referred us to some decided cases. <CITATION> (2) a Bench of <ORG> held that <ORG>, <ORG>, <ORG>, <ORG>, <ORG> etc., came within the expression "artificial silk" occurring at item no. 4 in the Third Schedule to the Madras General Sales Tax Act, 1959. In the course of the judgment in (1) (1970) 25 S.T.C. 151.

(2) (1968) 21 S.T.C. 367.

that case it was observed that the import and content of those words have not been defined in the Sales Tax Act s and the Courts are bound to have recourse to the meaning attributable to such words by persons who are dealing in and utilising such goods. The extreme, peculiar and scientific meaning of the goods which might sometimes deviate from the popular meaning, cannot prevail. The meaning which the trade, <ORG> officials and statutes attribute to the words "artificial silk" was considered by <ORG> to be the ordinary and popular meaning of that expression. <CITATION> (1) this Court held tooth powder to be a "toilet requisite" and liable to sales tax at a single point under <CITATION> of the Act read with entry no. 6 of the: notification, with which we, are also concerned in the present case, it being observed that the names of the, articles, sales and. purchases of which are liable to be taxed, given in a statute, unless defined in the statute, must be construed not in a technical sense but as understood in common par lance. In this decision reference was made to an earlier decision of this Court by five Judges in <NAME> v. Assistant Sales Tax Officer <NAME> (2 in which "betel leaves" were not considered as "vegetable". <CITATION> (3) the word "coal" was held by this Court to include "charcoal", it being observed that, while interpreting items in statutes like the Sales Tax Act s, resort should be had not to the scientific Or technical meaning of such terms, but to their popular meaning or the meaning attached to them by those dealing in them, that is to say, to their commercial sense. In the course of the judgment, after referring to certain decisions, including the decisions from Australian, Canadian and English Courts, it was observed :

"The result emerging from these decisions is that while construing the word "coal" in entry 1 of Part III of Schedule 11, the test that would be applied is what would be the meaning which persons dealing with coal and consumers purchasing it as fuel would give to that word. A sales tax statute, being one levying a fax on goods must, in the absence of a technical term or a term of science or art, be presumed to have used an ordinary term as coal according to the meaning ascribed to it in common parlance. Viewed from that angle both a merchant dealing in coal and a consumer wanting to purchase it would regard coal not in its geological sense but in the sense as ordinarily understood and would include 'charcoal' in the term 'coal'. It is only when the question of the kind or variety of coal would arise that a distinction would be made between coal and charcoal; other- (1) (1970)26S.T.C.339. (2) (1961) 12 S.T.C. 286.

(3) (1967) 19 S.T.C. 469.

wise both of them would in ordinary parlance as also in their commercial sense be spoken as coal."

It may be pointed out that the entry in the case cited read "coal including coke in all its forms". <CITATION> (1) cloth manufactured by means of power-looms was held by this Court not to fall within the words " cloth manufactured by mills" in the Notification dated June 8, 1948, issued under <CITATION> of the Act and the sale of such cloth was held not liable to be taxed at the higher rate of 6 ps. in a rupee. According to this decision power-loom cloth in popular language is never associated with mill cloth. In view of these and some other decisions the learned counsel for the appellant, it may be said in fairness, did not dispute that the words with which we are concerned must be construed in the sense which is imputed to them by the persons who deal in and who consume such articles.

"Food colors" and "syrup essence" being themselves known articles of common use, the question arises whether the words and expressions used in entries 10 and 37 of the List are intended to take within their fold goods popularly known in common parlance by the names of "food colors" and "syrup essences".

It cannot be gain said that "food colors" and "syrup essences" are edible goods whereas "dyes and colors and compositions thereof" and "scents and perfumes" as specified in entries nos. 10 and 3 7 of the List do not seem prima facie to connote that they are edible goods. This is the reasoning of <ORG> and it appears to us to be both logical and rational. Indeed, except for items like 'salt' in entry no. 34, the "sugar manufactured by mills' (entry no. 49) and "Banaspati, including refined coconut oil" (entry no. 43) which is capable of being used as medium for cooking is prima facie edible there does not seem to be any other edible article included in the List. Item no. 25 speaks of "Oils of all kinds other than edible oils manufactured on Ghanis by human or animal power". This scheme suggests that, apart from the undoubted edible goods, in cases where the import of the specified goods is wide enough to include both edible and non-edible category then the intention has been clearly expressed whether or not to include edible goods. How in the case of entries nos. 10 and 37 we are inclined to think in agreement with <ORG> that these entries are not intended to extend to edible colors like food colors and to edible essences like syrup essences. It would indeed be straining the meanings of the words and expressions in those entries as understood in popular commercial sense to include edible colors and essence-,. If the intention of <ORG> was to include food colors in entry no. 10 and syrup essences in entry no. 37 then in our view these goods could easily have been (1) (1971) 28 S.T.C. 325.

specified by their own popularly known description. In any event assuming that another view as to the meaning of these entries is possible we have not been persuaded to hold that the view taken 'by <ORG> is so grossly erroneous that we should interfere on special leave appeal under Art. 136 of the Constitution.

<NAME> made a passing reference to the Prevention of Food Adulteration Rules, 1955 framed under ss. 4 and 23 of the Prevention of Food Adulteration Act, 37 of 1954 and pointed out that r. 23 postulates addition of coloring matter to an article of food when permitted. This, according to the argument, suggests that the word 'color' as used in entry no. 10 of the List of the Notification in question has been used in a broad enough sense so as to take within its fold edible color or food color. We are not impressed by this argument. Rule 23 of the Prevention of Food Adulteration Rules indeed seems to go against the submission.

The appellant's learned counsel had at one stage suggested that the goods intended to be taxed under <CITATION> of the Act are all luxury goods and therefore food colors and syrup essences which are normally used by comparatively richer class of society should be presumed to have been intended to be included in items nos. 10 and 37 of the List. On closer scrutiny of the List, however, this point was rightly not developed.

For the reasons foregoing this appeal fails and is dismissed with costs.

<ORG> dismissed.


PETITIONER: UNION OF INDIA [RAILWAY BOARD] & <ORG>. Vs. RESPONDENT: J.V. SUBHAIAH & <ORG>. ETC. ETC. DATE OF JUDGMENT15/12/1995 BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. FAIZAN UDDIN (J) KIRPAL B.N. (J) CITATION: 1996 SCC (2) 258 JT 1995 (9) 488 1996 SCALE (1)193 ACT: HEADNOTE: JUDGMENT:

J U D G M E N T Ramaswamy, J.

Leave granted in all the special leave petitions. The respondents were admittedly appointed in <ORG> at Rajahmundry, Visakhapatnam, Vijianagaram and Dharmavaram in <ORG>. They filed different O.As. before <ORG>, Hyderabad Bench seeking declaration that they are "regular Railway employees in Class III posts" and entitled to be paid regular salary for continuous service from the date of the respective appointments in the Societies and also consequential promotion, increments and payment of arrears of salary. The <ORG>, Hyderabad Bench following the decision of the Madras Bench delivered on June 29, 1990 in O.A.No.305/88 allowed the O.As. and gave the directions for grant of the reliefs referred to earlier but payment of salary was directed to be made from the date on which respective applications were filed. By the time the present Special Leave Petitions came to be filed, a two-Judge Bench of this Court by order dated September 7, 1994 made in C.A. No.2932/91 confirmed the order of the <ORG>, Madras Bench but the review petition was pending. When these appeals had come up for hearing on October 16, 1995 it was pointed out to another Bench by the Additional Solicitor General that despite the dismissal the matter required examination and for that reason notice was already issued in another case, viz., C.A. @ SLP 24287/95. All the matters were accordingly tagged together. After the dismissal of the review petition a two-Judge Bench by order dated November 13, 1995 referred the matter to this Bench. Thus these appeals by special leave.

The admitted facts are that the respondents were appointed by the respective <ORG> registered under the Andhra Pradesh Co-operative Societies Act, 1964 as amended from time to time. <ORG> were organised by <ORG> as social welfare measure to inculcate thrift and cooperative spirit in the management of the societies, distribution of essential commodities and lending of credit facilities etc. to the members of the societies. Under the bye-laws, respective societies consist of serving members of <ORG> at the respective places. Normally these societies are formed at railway junctions. They are organised under the instructions issued by <ORG> in the Railway Establishment Manual [non- statutory orders]. Working of the societies are supervised by the welfare officers appointed by <ORG>. It is in dispute as to whether salaries to welfare officers are paid by the societies concerned or by <ORG> but that is not material for disposal of these appeals. It is also not in dispute that one third of the members of the societies are nominated by <ORG>.

<NAME>, learned Additional Solicitor General contended, on the facts, that <ORG> registered under the Co-operative <ORG> Act , a <ORG> Act and the articles of association or the bye-laws of the societies are sanctioned by the Registrar of Co-operative <ORG> [for short, "the Registrar"] of the concerned <ORG> appointed by the <ORG> Government under the respective <ORG> Act s. The constitution of the societies is regulated and registered under the <ORG> Act . Appropriate law, rules and bye-laws provide that <ORG> of the society periodically elects the members of the committee which in turn elects the President or general body itself elects the President, for a specified term. The President and the committee, as the case may be, is empowered to appoint the officers, employees and servants of the <ORG> according to its bye-laws. The Registrar under the respective Acts, has supervision and control over the working of the societies and its employees. In case of dispute between the society and its members or the society and its officers or employees, the same is resolved by an arbitrator under the Act and appeal thereunder is provided to a <ORG> constituted or an appellate forum specified. The jurisdiction of a civil court stands excluded in respect of the said disputes. Salaries to the staff are paid by the society. <ORG> Establishment Manual prescribes procedure for organisation of the welfare activities, one of which is establishment of consumer credit co-operative societies or house building societies. The share capital, though deducted from the salary of the member-employees, is only by way of an amenity to enable them to organise, as a co-operative movement, for self-help and thrift. The Administration has no control over selection, appointment and payment of salaries to the staff of the society. No qualifications are prescribed in that behalf. It is due to administrative exigencies of the concerned <ORG> or the <ORG> that appointment or dismissal can be made by the President/committee as per the procedure prescribed under the respective Acts or the Rules or bye-laws made thereunder. Thereby <ORG> has no managerial or administrative control over the staff of the <ORG>/<ORG>. The conditions of service of the officers of <ORG> are not applicable to them. If the <ORG> is liquidated by the Registrar for its mismanagement the employees of the <ORG> seek the remedy only against the <ORG>. The societies have not been impleaded as respondents. The ratio in <CITATION> . [(1990) Supp. SCC 191] cannot be applied to the employees of the <ORG>/<ORG>. The rent-free accommodation and provision of electricity to the <ORG> and medical facilities to the employees are extended as a part of the welfare measure without creating an obligation on the part of <ORG> to treat them as <ORG> employees. In <NAME>'s case recognised cooperative canteens were organised as a part of the statutory duty under Section 46 of the Factories Act where employees are 100 or above in number but below 250. The ratio laid down therein is inapplicable to the facts of these appeals. <NAME>, learned senior counsel and Mrs. <NAME>, learned counsel for the respondents contended that the ratio of <NAME>'s case applies on all fours to the facts of these appeals. <ORG>/<ORG> have been organised at the instance of <ORG>. Their work is controlled and supervised by the Welfare Officer appointed by <ORG> and subsidy is being paid by <ORG>. The society is merely an intervening agency or veil between <ORG> and the employees of the Cooperative <ORG>/<ORG>. <ORG> admittedly gives facilities like railway passes, quarters on nominal rent, free medical aid and other amenities given to the regular officers and servants of <ORG> from time to time. <ORG> issues circulars from time to time to control, organise and supervise the working of the <ORG>. The <ORG> Establishment Manual itself is a complete code in that behalf. Merely because <ORG> kept its arms as an intervening agency between the <ORG> and the employees, it cannot disown its liability to treat the employees appointed by the <ORG>/<ORG> [like canteen cases] as its employees. The decision of the Madras Bench of the <ORG> since upheld by this Court in an appeal and review petition also having been dismissed, the employees appointed by the respective <ORG> in <ORG> and <ORG> form a class discharging the same duties. Therefore, the respondents cannot be denied their Constitutional right to have equal treatment as had by the regular <ORG> employees. Smt. <NAME> placed strong reliance on yet another decision of a two-Judge Bench of this Court in <CITATION> . [(1995) Supp. 2 SCC 611].

In view of the respective contentions a question giving rise to far-reaching consequences emerges for decision in these appeals. The question is whether the officers, employees and servants appointed by <ORG> registered under the Co-operative <ORG> Act of a State or <ORG> Registration Act (for short, `the <ORG>') and organised as a welfare measure to inculcate co-operative movement, self-help and thrift among the officers and servants of <ORG>, can be declared to be regularly appointed <ORG> employees? Whether they are <ORG> employees defined under the <ORG> Establishment Manual and entitled to all the consequential benefits? Before adverting to the instructions in the <ORG> Establishment Manual, it would be profitable to consider the legal setting of the appointments of the employees and servants of the <ORG>. In this case since admittedly the A.P. Co-operative <ORG> Act [7 of 1964] (for short `the Act') is applicable, its provisions and of the predecessor Acts repealed thereunder and of the Rules made thereunder as amended from time to time and bye laws of the society are required to be examined. The Act was enacted with a view to encourage co-operative movement, inculcate thrift and self-help and to organise the societies on democratic lines. The right to form a society is a statutory right and is not a fundamental right, a <ORG> registered under Section 7 , on compliance with and conforming to the requirements laid down therein and the rules made thereunder, is a body corporate under Section 9 . The Registrar is empowered under Section 15 to divide the area of operation of the <ORG> or amalgamate <ORG> for their day to day better working. The amendment to the bye- laws shall be approved by the Registrar and registered under Section 16 . The rights and liabilities of the members are regulated in Chapter III subject to Section 21 . Section 19 regulates the eligibility of a member and other qualifications. Section 21 prescribes disqualification for membership of the <ORG>. Section 21-A prescribes disqualification for membership of the committee of the society. Section 21-AA envisages cessation of membership of a committee and the reinstatement under Section 21-B . Election and the right to vote is regulated by Section 25 . Management of the society is regulated by Section 30 .

The ultimate authority of the <ORG> vests in its general body vide Section 30 (1) (a). It would be subject to the other provisions of the Act and the Rules and bye-laws made thereunder. Section 31 prescribes the procedure for constitution of a committee and their duties and responsibilities etc. Section 32 prescribes procedure for holding general body meeting of the <ORG> and the committee and sub-section (4) thereof empowers the Registrar to appoint a Special Officer with remuneration for the management of the committee. Section 37 , with an non- obstante clause and subject to the execution of an agreement, empowers the <ORG> to deduct the share capital or any amount from monthly salary or wages payable to a member of the <ORG>. The duration of elected body is five years. Chapter VII consists of Sections 50 to 60 for audit, enquiry, inspection and surcharge for the mismanagement and recovery of the amounts found mismanaged or defalcated from the members of the committee or the officers or servants of the <ORG>. Chapter VIII deals with settlement of disputes. It consists of Section 61 to 63 . Sub-section (1) of Section 61 with a non-obstante clause provides that any dispute touching upon the constitution, management or the business of the <ORG> other than a dispute regarding disciplinary action taken by the <ORG> or its committee against a paid employee of the <ORG>, shall be resolved by arbitration on a reference under Section 62 and recovery of the monies due to it. Chapter IX deals with winding up of and cancellation of the registered <ORG>. Liquidator gets appointed to wind up the <ORG>. Chapter X deals with execution of the decisions, decrees or orders. Chapter XI provides for constitution of <ORG>, appointment of the members of the <ORG>, appeal thereto, revision to the Registrar and review of the orders had been provided in Sections 76 , 77 and 78 . Chapter XII deals with offences and penalties.

Section 79 (1) (a) provides that "it shall be an offence under the Act, if a committee, an officer, employee or any member of the society willfully makes a false return or furnishes false information, on a lawful order or direction issued" under the Act. Clause (aa) provides that "if the committee, an officer, employee or any member of the society furnishes false information to gain admission or to continue as member of a society etc., it/he shall be liable for prosecution as envisaged under the Act. Special Courts are empowered to take congnizance and try an offence against the officers etc. constituted under Section 83-A .

Section 116-A with a non-obstante clause gives power in Chapter IVX to the Registrar to constitute a common cadre for the categories of employees for certain societies enumerated thereunder. Section 116-AA equally gives power to him to abolish the centralised services for certain categories of employees. Section 116-C empowers the societies with prior approval of the Registrar to fix staffing pattern, qualifications, pay-scales and other allowances. In case of a society receiving financial aid from the Government, appointment or removal of the Chief Executive of the society by whatever name called of any society should be made only with the prior approval of the Registrar as per sub-section (2) of Section 116-C . Section 121 bars the jurisdiction of courts and provides that no order, decision or action taken or direction issued under the Act by an arbitrator, liquidator, Registrar or <ORG> etc, shall be liable to be called in question in any court. The rights and liabilities are subject to the bye-laws, Rules and the Act. The <ORG> owes its existence and continuance by its efficient and proper management by the <ORG> assisted in its day-to-day management by its staff.

Rules 28 and 29 of the Co-operative Societies Rules of 1964 [for short, "the Rules"] provide as under:

"28. Officers and servants of societies:

- (1) No society shall appoint any person as its paid officer or servant in any category of service, unless he possesses the qualification and furnishes the security as specified by the Registrar, from time to time, for such category of service in the society or for the class of societies to which it belongs.

(2) No society shall retain in service any paid officer or servant, if he does not, acquire qualifications, or furnish the security, as is referred to sub rule (1) within such time as the Registrar may direct.

(3) The Registrar may, for special reasons, relax in respect of any paid officer or servant, the provisions of this rule in regard to the qualifications he should possess or the security he should furnish. (4) No society shall appoint as its paid officer or servant in any category of service any person who is related to any director or member of the committee of a financing bank to which the society is affiliated except with the prior approval of the Registrar.

(5) Notwithstanding anything contained in the bye-laws/special bye-laws, service regulations or common cadre regulations of the co-operative societies, every paid servant and officer of a society, other than those in the last grade service, shall retire from service on the afternoon of the last date of the month in which he attains the age of 58 years.

29. Appointment of Secretary:- Every financing bank, every credit society with limited liability and a working capital of not less than Rupees one lakh shall appoint a paid secretary. The paid secretary shall be disqualified for being appointed as, and for being a member of the committee of the financing bank, the society or the mortgaged bank, as the case may be:"

A conspectus of these provisions would clearly indicate that registration of the society, election to the committee, the term thereof, rights and liabilities of the members and office bearers are regulated under the Act. Power to appoint officers, employees and servants of the society is given to the President or the committee, as the case may. They are regulated by the bye-laws, Rules and the Act. Their service conditions are regulated by those provisions with prior approval of the Registrar. A sample bye-laws of the society relating to <ORG> has been placed before us. It shows that under bye-law 19, the management of the affairs of the society, subject to the resolutions passed from time to time by the general body or the committee from time to time, "shall vest in the managing committee". Under bye-law 20, the general body elects, amongst themselves, a President, a Secretary, an Assistant Secretary. Under bye-laws 23, subject to the resolutions passed by the managing committee from time to time, several officers of the society shall have the powers to manage the society as enumerated thereunder. Sub-bye-law (2) thereof provides that <ORG> shall appoint a paid Manager who, among other things, shall be responsible to carry on day-to- day work of the society on sound lines. Under sub-law (3), the managing committee is empowered to prescribe from time to time the strength of the establishment of the society and the scales of pay and allowances admissible to each member appointed by the President. Under sub-law (3) (c), the President shall have the power to fine, suspend or dismiss the members of the establishment. Except in the case of fine, an appeal shall lie to the <ORG> against every order awarding a punishment by the President. Under bye-law 27 (2), no officer or servant shall remain in any category of service in the <ORG>, if he does not furnish security as prescribed by the Registrar. The other bye-laws are not relevant for the purpose of these cases.

It would thereby be clear that the power to prescribe strength of the establishment appointment of the staff of the <ORG>, its officers, employees and servants, and their scale of pay are regulated by bye-laws, Rules and the Act. Disciplinary control lies with the President and the <ORG>. The disciplinary action against its employees is excluded from the arbitration proceedings, by operation of Section 60 . For offences etc. are prosecuted under the Act, the jurisdiction of the civil court is excluded. Appointment of the officers, employees and servants of the <ORG> is regulated by the provisions of the Act, Rules and the bye- laws as self-contained scheme and code. The <ORG> enjoys autonomy as a body corporate subject to the provisions of the Act, Rules and bye-laws. It enjoys exclusive power to appoint and keep disciplinary control over the staff in its establishment. The tenure is subject to bye-laws, Rules and Act and law so long as the <ORG> is not liquidated as per law. In <ORG>. v. <ORG>, Andhra Pradesh, Hyderabad [] this Court had held that Industrial Disputes Act would apply to the employees appointed under the Act by <ORG>. It would, thereby, be clear that appointments of the staff of the establishment, control and disciplinary actions are regulated under the provisions of the Act, the Rules and the remedies provided under law.

The question, therefore, emerges whether the officers, employees and servants appointed by <ORG> organised under the Railway Establishment Manual could be treated as Railway servants. Paragraph 10B of the Indian Railway Establishment Code defines "Railway Servant" to mean "a person who is a member of a service or who holds a post under the administrative control of <ORG> and includes a post in <ORG>". In other words, a person must be appointed to a service or a holder of a post under the administrative control of <ORG> including a post in <ORG> itself. Admittedly, respondents are not members of the service nor do they hold post under the administrative control of <ORG>. They seek party only on the basis of the rule laid down by this <ORG> in <NAME> case [supra].

Before dealing with the effect of the ratio of <NAME> case, it would be appropriate to deal with yet another decision rendered on the same day by the same Bench which was argued in the same batch but a separate Judgment was rendered, viz., <CITATION> through the Chairman [] to which one of us, <NAME> J., was a member. Therein the question was whether the employees appointed in the institutes or clubs maintained by the <ORG> employees as welfare measure could be treated as <ORG> employees on par with <ORG> canteen employees [statutory or non- statutory recognised canteens]. This Court recognising that the establishment of the institutes or clubs, though recognised by the <ORG>, was only a welfare measure, had held that formation of the institutes or clubs was not mandatory. They are established as a part of the welfare measure for the <ORG> staff and the kind of activities they conduct, depends, among other things, on the funds available to them. The activities have to conform to the objects since by their very nature the funds are not only limited but keep on fluctuating. The institutes or clubs and the benefits that would flow on them will depend upon the budgetary provisions for the institutes and clubs and keep flowing from time to time. If the employees working in the institutes or clubs are recognised as <ORG> employees it will have snow-balling effect on other welfare activities carried out by the <ORG> and similar activities carried "on by all other organisations". In the light of those factual matrices, it was held that there was no relationship of employer and employee between the <ORG> Administration and the employees engaged in the institutes and clubs. Neither law nor facts spell out such relationship.

In <NAME>'s case [supra], establishment of a canteen was one of the mandatory requirements as a part of efficient <ORG>. Where the employees are 250 and above, Section 46 of the Factories Act mandates the industrial establishment to establish and maintain canteens. If the employees are 100 and above, though it was not mandatory but maintenance of a canteen under the <ORG> Establishment Manual is a part of the <ORG>. In that factual and legal setting, this Court was to consider the effect of non-statutory recognised canteens registered under the Co-operative Societies Act and the staff appointed in those societies. It was held that the management of the Societies was controlled by the <ORG> by appointing a Chairman or Secretary as a member of the <ORG>. The nominees of the <ORG> are statutorily obligated to bring to the notice of the <ORG> all the management and affairs of the committee which is likely to affect the interests of the <ORG> in its capacity as the owner of the premises and furniture equipments etc. If the decision of the committee is likely to be of a considerable magnitude it is required to be brought to the notice of the <ORG>. The General Manager of the <ORG> has supervisory control over the management of the committee as per the provisions contained in the <ORG> Manual. For the purpose of giving subsidy for wages, the rates of pay and allowances to the staff canteen employees are regulated by the Manual. Revision of the scales of pay and dearness allowance to the managing committee was also regulated therein. The <ORG> had given directions from time to time to ensure compliance of those requirements. This Court also intervened and pending appeals, gave directions to pay to the canteen employees equal pay on par with regular employees of the <ORG> and compliance was enforced by orders of this Court. Their service conditions are regulated by the instructions. The employees in the canteens are also entitled to free medical treatment as out-door patients in <ORG> hospitals etc. In the backdrop of those facts and the Rules, this Court had held that the employees appointed, even in non-statutory recognised canteens registered under Co-operative Societies Act or the recognised canteens, would be entitled to claim the status of <ORG> servants.

<NAME>, in all frankness admitted that there is a dichotomy of dual control exercised by the Registrar under the Act and the control by <ORG>. But he contends that since the staff appointed by <ORG> running canteens are treated as <ORG> servants the same ratio should be extended to the employees appointed by <ORG> since this is also a welfare amenity totally controlled by <ORG> and 10 per cent subsidy is also regularly given.

It is not necessary to embark upon a detailed examination into the instructions given in various paragraph Nos.2901 to 2909 in chapter 29 of Railway Manual (placed before us) dealt with by the <ORG>, Madras Bench in its judgment. Suffice it to state that admittedly instructions have been issued to regulate the systematic organisation and management of the <ORG>/<ORG>. The Government, as a welfare measure, gives 10 per cent subsidy to enable the <ORG> to manage its affairs supervised by the Welfare Officer of <ORG>. Employees become members of the <ORG> by contributing towards share capital. Initial amount is paid by <ORG> and is later deducted from their salary. It also gives free accommodation for housing the <ORG>, electricity, free medical aid in its hospitals to those employed by the <ORG>. In the Manual it is specifically stated that they are entitled to traveling passes when they go to attend the committee meetings. Even otherwise the facilities extended are optional and are only a part of on-going welfare measure.

It is seen that service conditions of the employees, officers and servants of the Stores/<ORG> are not regulated by <ORG>. They are governed by the bye-laws of the <ORG> subject to control and sanction by the Registrar under the State Act or the relevant provisions. There is no obligation on the part of <ORG> to provide security for those employees. The disciplinary control by the Society concerned is subject to other laws and is exclusively domestic in character. The Railway Establishment Code is not applicable to them. Their appointment is subject to bond prescribed by the Registrar. The arrears of funds or misappropriated amounts etc. are recoverable under the provisions of the State Act and the Rules made thereunder. The services of the staff are liable to termination in terms of the State Act , Rules and bye-laws.

In other words, there is a dual control over the staff by the <ORG> and the Registrar. In that behalf, <ORG> has no role to play. If the subsidy is considered to be a controlling factor and <ORG> as an intervening agency or veil between <ORG> and the employees, the same principle would equally be extendible to the staff, teachers, professors appointed in private educational institutions receiving aid from the appropriate <ORG> to claim the status of <ORG> employees. Equally, other employees appointed in other Co- operative <ORG> organised by appropriate <ORG> would also be entitled to the same status as <ORG> servants. Appointment to a post or an office under the <ORG> is regulated under the statutory rules either by direct recruitment or appointment by promotion from lower ladder to higher service or appointment by transfer in accordance with the procedure prescribed and the qualifications specified. Any appointment otherwise would be vertical transplantation into services de hors the rules. Appointment through those institutions becomes gate-way for back door entry into <ORG> service and would be contrary to the prescribed qualifications and other conditions and recruitment by <ORG> or appropriate agencies. As contended, if the employees of the societies like co-operative canteens are declared to be railway servants, there would arise dual control over them by the Registrar and <ORG> but the same was not brought to the attention of the court when <NAME> case was decided.

It is true that the order of the two-Judge <ORG> of this Court had upheld the order of the <ORG>, Madras <ORG> which had become final. With due and great respect to our learned brethren constituting the <ORG>, these features noted by us do not appear to have been put up for their consideration and so they did not have occasion to consider the impact as envisaged hereinbefore. The <ORG> merely stated thus:

"... The <ORG> has examined in detail Chapter XXIX of the Indian Railway Establishment Manual and has preferred to paras 2901 to 2909. Based on the provisions of the Railway Manual and taking into consideration the actual working of the Stores, the <ORG> has come to the conclusion that the employees working in the Co-operative Stores are in fact and in law, the employees of <ORG>. We have been taken through the judgment of the <ORG> and other relevant material on record. We so no ground to interfere with the reasoning and the conclusion reached by the <ORG>..".

In view of the above discussion and in view of the legal setting referred to hereinbefore, we are of the considered view that the Bench had not laid down any law except approving the reasoning and conclusion reached by the Madras Bench of the <ORG>. The Madras Bench had merely referred to the provisions in the <ORG> and proceeded on the premise that they gave rise to a legal base to treat the employees of the <ORG> as the <ORG> employees. The reasoning is wholly illegal and unsustainable for the reasons stated above.

The principle of equality enshrined under Article 14 of the Constitution, as contended for the respondents, does not apply since we have already held that the order of the <ORG>, Madras Bench is clearly unsustainable in law and illegal which can never form basis to hold that the other employees are invidiously discriminated offending Article 14. The employees covered by the order of <ORG> may be dealt with by <ORG> appropriately but that could not form foundation to plead discrimination violating Article 14 of the Constitution.

We, therefore, have no hesitation to hold that the officers, employees and servants appointed by <ORG> cannot be treated on par with <ORG> servants under paragraph 10B of the <ORG> Establishment Code nor they can be given parity of status, promotions, scales of pay, increments etc. as ordered by the <ORG>, Hyderabad Bench.

The appeals are accordingly allowed and the OAs stand dismissed but, in the circumstances, without costs.


JUDGMENT <NAME>, J.

1. This is a plaintiff's second appeal. The plaintiff's are <NAME>, his two sons <NAME> and <NAME>, and his wife Smt. <NAME>. Plaintiff No. 1 has been separate from the other plaintiffs, and there has been a partition between them. Plaintiff No. 1 is the owner of a half share, and the other plaintiffs are the owners. of the remaining half share of certain premises in Muzaffarnagar known as the "Royal Talkies". The building together with its fittings and ceiling fans had been leased to <NAME> who was the father of defendants Nos. 1 and 2 and the husband of defendant No. 3 who are respondents before us. <NAME> died some time in 1949 and the defendants have since then continued in occupation as tenants. It is common ground that the defendants caused material alterations in the building and. substantially damaged the same without the consent of the plaintiffs. The plaintiffs were therefore driven to the necessity of instituting suit No. 268 of 1950 against them in the court of the Munsif of Muzaffarnagar, in which the prayer originally was that the defendants should be restrained by an injunction from making any alterations in the property and from damaging the same so long as the property had continued in their possession as tenants. Later on, by an amendment of the plaint, a relief for recovery of a sum of Rs. 2,000/- as. damages had been added. The suit aforesaid was-instituted on the 29th of March, 1950. It was decreed upon compromise on the 20th of March 1952, on payment of a sum of Rs. 1,000/- to the plaintiffs. During the pendency of that suit an application was made to the District Magistrate of Muzaffarnagar by <NAME> requesting. that he may be granted permission under the U. P. Control of Rent and Eviction Act , No. III of 1947, to file a suit for ejectment of the tenants or occupants namely, "<NAME>, etc." because they had damaged the building to a very great extent and also because the plaintiffs wanted the building for starting their own business inasmuch as by the prospective legislation for the abolition of the zamindari rights their income would be materially affected. The permission sought for was granted. Thereupon the plaintiffs instituted Suit No. 87 of 1950 in the court of Civil Judge of Muzaffarnagar on the 2nd of December, 1950, for the ejectment of the defendants and for recovery of arrears of rent and mesne profits after giving the defendants a notice dated the 5th of July, 1950, by which they intended to terminate their tenancy from the Ist of August, 1950.

2. The defendants resisted the suit on the ground that in view of the provisions of the U. P. Rent Control and Eviction Act the permission obtained from the District Magistrate was of no help to the plaintiffs and that they had no cause of action against them. They further pleaded that the notice of ejectment was not in accordance with law, firstly, because six months notice to quit was necessary, and, secondly, because the notice was served prior to the sanction given by the District Magistrate. They further contended that no forfeiture had been incurred by them and they pleaded Order II, Rule 2 as a bar to the suit,

3. The trial court held that the defendants had substantially damaged and materially altered the building within the meaning of Section 3 of the U. P. Control of Rent and Eviction Act , (Act III of 1947), that Order II, Rule 2 barred the suit inasmuch as in the previous suit for damages the plaintiffs could make relief for ejectment and they did not; that no defect attached to the permission of the District Magistrate obtained by the plaintiffs under the Rent Control Act; that the notice of ejectment given under Section 106 of the Transfer of Property Act was a valid notice and that the plaintiffs were entitled to a decree for Rs. 525/- towards arrears of rent and for Rs. 900/- for use and occupation. In ranting the plaintiffs a decree for ejectment and drecting the defendants to vacate the premises within two months, the trial court observed:

"In view of my findings above that the permission obtained from the District Magistrate to bring the suit is valid and that the notices of ejectment served to the defendants are also valid, the defendants are liable to be ejected from the cinema house."

4. Against the decision aforesaid the defendants preferred civil appeal No. 269 of 1953 before the District Judge. The appeal was heard by the Additional District Judge of Meerut. The Additional District Judge held that the sanction accorded by the District Magistrate was defective inasmuch as it was in favour of only one plaintiff, namely, <NAME> and against only one defendant, namely, <NAME>; and that a suit based on such a defective sanction was not maintainable. The lower appellate court agreed with the view of the trial court in holding that the defendants substantially damaged and materially altered the building within the meaning of Section 3 of Act III of 1947 so as to make them liable to ejectment on that ground.

But the lower appellate court further held that since the plaintiffs aid not seek ejectment of the defendants in Suit No. 268 of 1950 aforesaid, the present suit in regard to ejectment was barred by Order II, Rule 2 of the Code of Civil Procedure, The lower appellate court concurred in the view of the trial court that the notice of ejectment given under Section 106 was a perfectly valid notice. The lower appellate court accordingly allowed the appeal in part, modified the decree of the trial court, dismissed the suit for ejectment and granted the plaintiffs a decree for Rs. 1225/- as arrears of rent from the 1st of May 1950 to 30th of November, 1950.

5. Against the decision of the Additional District Judge this second appeal has been preferred by the plaintiffs and two points have been urged, namely, (1) That the suit for ejectment was not barred by Order II, Rule 2 of the Code of Civil Procedure; and (2) That the permission granted by the District Magistrate under Section 3 ot Act III of 1947 was a valid and good permission.

6. On the other hand it has been contended by the defendants-respondents that the notice given was defective and the lease has not been determined and that in any event there has been a waiver.

7. We have already stated that the building together with its fittings and ceiling fans had been leased to <NAME> who was the father of defendants Nos. 1 and 2 and the husband of defendant No. 3. In 1946 <NAME>. the plaintiff instituted Suit No. 899 of 1946 in <ORG> against the aforesaid <NAME> for his ejectment and for recovery of certain amount as rent. The suit was compromised on the 28th of April, 1947. According to that compromise upon the fulfilment of certain conditions by <NAME>, the said <NAME> was to continue as tenant of the property for a term of three years beginning from the 1st of May, 1947, on a rent of Rs. 175/- per month. The conditions were fulfilled and <NAME> continued in occupation of the property as tenant. <NAME> died some time in 1949.

The defendants continued in occupation of the property as tenants and their possession as tenants had been recognised by the plaintiffs in Suit No. 268 of 1950 referred to above by which the plaintiffs sought a relief for injunction restraining the defendants from making any alteration in the property and from damaging the same as long as the property continued in their possession as tenants. It was no doubt by a later amendment of that plaint that a relief for recovery of a sum of Rs. 2,000/- as damages had been added. The suit aforesaid was decreed upon compromise on the 20th of March, 1952, on payment of a sum of Rs. 1000/-. As a lease is a transfer of an estate of inheritance, it does not terminate with the death of the original lessee, but survives during the: remainder of the term of his heirs and representatives and if the heirs and representatives are acknowledged as tenants and they continue in occupation of the premises as tenants after the efflux of the time limited by the original lease, there is holding over.

8. The question which we now propose to dispose of is whether the permission granted by the District Magistrate under Section 3 of the U. P. Control of Rent and Eviction Act No. III of 1947 was a valid and good permission. The permission of the District Magistrate for a suit for ejectment postulated under Section 3 of the U. P. Rent Control and Eviction Act relates to cases which are not covered by Clauses (a) to (g) of that section. Clause (b) covers a case where the tenant has wilfully caused or per-mitted to be caused substantial damage to the accommodation.

Clause (c) covers a case where the tenant has, without the permission in writing of the landlord, made or permitted to be made any such construction as in the opinion of the court has materially altered the accommodation or is likely substantially to diminish its value. If the suit is regarded as one falling under Clauses (b) and (c) the permission of the District Magistrate would not be necessary. In the present case there is concurrent finding of fact of the two courts below that the tenants wilfully caused or permitted to be caused substantial damage to the accommodation and they without the permission in writing of the landlord, made constructions which materially altered the accommodation. The present case was therefore covered by Clauses (b) and (c) of Section 3 and the permission of the District Magistrate would not therefore be necessary.

9. Coming now to the actual permission it appears that on the 1st of September, 1950, an application was made by <NAME> alonejo the District Magistrate in which he stated that "<NAME>, etc." had been occupying the cinema hall as tenants; that they had made substantial alterations in the building which caused damage to the building to a great extent; that he did not wish them to continue in occupation of the building, the more so because after the abolition of the zamindari, which was his main source of income, his resources would be considerably affected and he wanted the accommodation for himself in order to start some business. <NAME> requested the District Magistrate to grant him the permission to file a civil suit against the "occupiers" for their eviction. The District Magistrate granted the permission which was conveyed by the Rent Control and Eviction Officer of Muzaffarnagar to <NAME>. This communication, which is dated the 13th of October, 1950, was as follows:

"Please refer to your application dated 1-9-1950 addressed to the District Magistrate. I have the honour to communicate the order of the District Magistrate given below. 'I have perused the report of the D. S. O. and Cinema Officer. The tenant has made unauthorised alterations in the cinema hall. The consent of the owner has not been established. Due to the impending zamindari abolition legislation the personal need of the owner is genuine. Permission will be awarded to the owner to file a civil suit for the ejectment of the tenant.' "Hence under the orders of the District Magistrate you are hereby accorded permission to file a civil suit against your tenant Sri Debi Prasad under Section 7 of the Rent Control and Eviction Act ."

10. In regard to the permission aforesaid it has been contended on behalf of the appellants that the lower appellate court's view that this permission was defective because it was in favour of only one of the landlords, namely, <NAME> and against only one of the tenants, namely, <NAME> was not based upon a correct appreciation of matter. <CITATION> , AIR 1956 All 175 (A), a learned Judge of this Court held that where permission to sue for ejectment has been obtained under Section 3 , it will automatically enure not only to the benefit of the person who obtained it but also to the benefit of the others who were interested in filing the suit.

It was further held that where it is mainfest that all the plaintiffs landlords who were interested in the matter brought the suit after serving a notice on the tenants to vacate the premises in suit, it will be deemed that the plaintiff who obtained the permission acted as agent on behalf of the other plaintiffs. We are in accord with that view. We are further of opinion that where an order of the nature covered by the present suit has been obtained by one of the plaintiffs who will be deemed to have acted as agent on behalf of the other plaintiffs for the ejectment of "the tenant" and the order specifies only one such person as tenant the order will be deemed to cover the entire body of tenants and not simply one out of them whose name was specified, not by the District Magistrate but by the Rent Control Officer. We have quoted the order of the District Magistrate and in that order the District Magistrate granted permission "to the owner" to file a civil suit for the ejectment of "the tenant". Such a permission was therefore valid and it automatically enured to the benefit of the entire body of owners or landlords against the entire body of the class designated as "the tenant".

11. Under Section 108(o) of the Transfer of Property Act the lessee must not pull down or damage buildings' belonging to the lessor or commit any other act which is destructive or permanently injurious thereto. It is clear that the tenant cannot make structural additions and alterations without the consent of the landlord. Alterations that are not authorised amount to a breach of the implied covenant mentioned in Clause (m) of Section 108 . Such alterations will also be a breach of the implied covenants mentioned in Clauses (o) and (p) of the section.

12. Section 111 of the Transfer of Property Act, inter alia provides that a lease of immovable property determines. (a) by efflux of the time limited thereby;..... (g) by forfeiture; that is to say, (1) in case the lessee breaks an express condition which provides that on breach thereof the lessor may re-enter and the lessor gives notice in writing to the lease of his intention to determine the lease..... (h) on the expiration of a notice to determine the lease duly given by one party to the other.

13. Leases for a definite period, such as a lease for a year, or for a term of years, expire on the last day of the term and the lessor may enter without notice or other formality. Under Clause (g) of Section 111 a breach of condition only makes the lease voidable, the forfeiture is not complete unless and until the lessor gives notice that he has exercised his option to determine the lease. In <NAME> v. <NAME>, (1947) 1 All E. R. 116 (B) it has been explained that when a forfeiture of a lease is incurred the lease is voidable and not void and in those circumstances the giving of a notice to quit may recognise the subsistence of the lease and may amount to a waiver of forfeiture, but when the tenancy is determined by a notice to quit the position is entirely different. When a valid notice to quit is given, the lease is determined and a new tenancy can be created by an agreement, express or implied, and no such agreement can be inferred from the fact of service of a second notice.

14. Under Section 112 of the Transfer of Property Act a forfeiture under Section 111 , Clause (g) is waived by acceptance of rent which has become due since the forfeiture, or by any other act on the part of the lessor showing an intention to treat the lease as subsisting, provided that the lessor is aware that the forfeiture has been incurred; provided also that where rent is accepted after the institution of a suit to eject the lessee on the ground of forfeiture such acceptance is not waiver. The election not to avoid the lease may be manifested in other ways besides acceptance of rent. Instances of such acts showing an intention to treat the lease as subsisting are a demand of rent accruing due since the breach, a suit for such rent, or acceptance of a sum paid into court as damages for breach of covenant to repair alleged to have been committed during the term.

15. Keeping in view the principles stated above we now proceed to examine the facts of this case. The lease was created in favour of <NAME> for a period of three years ending with the 30th of April, 1950. <NAME> died some time in 1949. The defendants since then continued in occupation as tenants. They substantially and materially damaged the building and caused material alterations in it without the consent of the plaintiffs. This amounted to a breach of the implied covenants mentioned in Clauses (m), (o) and (p) of Section 108 of the Transfer of Property Act.

There was no express condition in the terms of the compromise decree dated 28-4-1947, in Suit No. 899 of 1946 of the court of Munsif Muzaffarnagar, referred to above, which provided that on breach thereof the lessor may re-enter. Even if an express condition like that is to be inferred from the compromise decree emanating from the implied covenants mentioned in Clauses (m), (o) and (p) of Section 108 of the Transfer of Property Act, a breach of the condition only makes the lease voidable and the forfeiture woiild not be complete unless and until the lessor gave notice that he had exercised his option to determine the lease under Section 111 , Clause (g) of the Act.

The forfeiture under Section 111 , Clause (g) in the present case must be deemed to have been waived not only by acceptance of rent which became due since the forfeiture but by the act on the part of the lessor in the subsequent suit No. 268 of 1950 brought against the tenants showing an intention to treat the lease as subsisting. As we have already said, such an intention on the part of the lessor must be inferred because, although the lessor was aware that the forfeiture had been incurred, the lessor in the suit aforesaid clearly indicated that the forfeiture has been waived; and that was why the lessor in spite of the forfeiture prayed for a relief of injunction restraining the tenants from making any future alteration in the building so long as the tenancy existed.

It appears that in Suit No. 268 of 1950 aforesaid a compromise was entered into between the parties. That compromise is on the record. It mentions that Suit No. 268 of 1950 as also Suit No. 57 of 1950 (namely, the present suit out of which this second appeal has arisen) had been compromised and that in Suit No. 268 of 1950 the plaintiffs had received Rs. 1000/- from the defendants. On 12-4-1952 when Suit No. 57 of 1950 was taken up for hearing, an application which is paper No. 127 C on the record, was made on behalf of the defendants.

In that application it was stated that the plaintiffs in their Suit No. 268 of 1950 of the court of the <ORG> had unequivocally compromised the ground of claim, namely that the defendants tenants had materially altered and damaged the premises of the plaintiff and had accepted Rs.1000/-from the defendants by way of compensation" for the said alterations and that in the light of the above fact the plea of damages or alteration of the premises did no longer remain open to the plaintiff in the present suit. The defendants therefore prayed that the plaintiffs' evidence on the said plea be disallowed and the compromise be admitted in support of the defendants' plea of waiver.

This application was disposed of by the learned Additional Civil Judge by an order dated 1-5-1952, by which he stated that Suit No. 268 of 1950 was compromised between the parties on the understanding that that case as also the present Suit No. 57 of 1950 shall be compromised together; that as a matter of fact the compromise of both these suits had been settled in open Court by the parties and thereafter the first suit was compromised on a payment of certain sum, while the terms of the compromise in the second suit were left to be recorded in writing and the completed compromise was to be filed the next day; that on the next day the parties informed the court that the corn-promise talks had fallen through on account of some misunderstanding and that it would therefore be wrong to contend that the compromise of the first suit should in any way lead to the shutting out of any evidence in this case.

Upon that view of the matter the learned Additional Civil Judge rejected Application No. 127 C. The learned Additional Civil Judge allowed evidence to be led on the question of material alteration or damage to the building and he held, independently of the compromise decree in the earlier Suit No. 268 of 1950, that there was material damage or alteration to the building. Whether it was open to the learned Additional Civil fudge to take fresh evidence on the point or whether lie should have taken that question to have been finally concluded by the compromise decree in Suit No. 268 of 1950 is not now necessary for us to decide.

In any event, the act of the plaintiffs in entering into a compromise in Suit No. 268 of 1950 and in accepting a sum of Rs. 1000/- as damages for the alterations in the building amounted, in our opinion to an act on the part of the lessor showing an intention to treat the lease as subsisting. In these circumstances and in view of Section 113 of the Transfer of Property Act the notice given under Section 111 Clause (h) must be deemed to have been waived with the express or implied consent of the persons to whom it was given by an act of the persons giving it, showing an intention to treat the| lease as subsisting. It follows therefore that the relief for ejectment and for damages for use and occupation, instead of for rent, was rightly refused by the lower appellate court. Upon this view of the matter, although we have disagreed with some of the findings of the lower appellate court, the refusal to grant the relief for ejectment must be upheld.

16. There remains only one other point to be determined and that is whether the present suit was barred by Order II, Rule 2 of the Code of Civil Procedure. In giving an affirmative finding on this issue the lower appellate court was swayed by the consideration that when the earlier Suit No. 268 of 1950 was filed the cause of action for ejectment had already accrued to the plaintiffs and since that cause of action was not made the subject of relief in that suit the present suit was barred under Order II, Rule 2.

This reasoning in our opinion is faulty. Suit No. 268 of 1950 for the relief of injunction was filed when the alterations were still in progress. It was during the pendency of that suit that an ad-ditional relief for damages had been added to that plaint. A suit for ejectment required determination of the lease by a prior notice under the Transfer of Property Act and it was on the expiration of that notice to determine the lease and that the lease will be deemed to have been determined under Section 111(h) of the Transfer of Property Act. On the date of that suit the lease had not been determined by a notice under Section 111(h) . Consequently a relief for ejectment could not have been made in that suit.

The argument that the plaintiffs could have asked the court that Suit No. 268 of 1950 should have been kept stayed for some time and that that interval could have been utilised for the giving of a notice for the determination of the lease and thereafter a relief for ejectment could have been added to the plaint in Suit No. 268 of 1950 by making certain additional averments in the plaint has only got to be stated in order to bear out our view that it has got no substantial basis for its acceptance. If a relief for ejectment could not have been made on the date the suit No. 268 of 1950 was instituted, the second suit for such a relief cannot be said to be barred by the principles of Order II, Rule 2 of the Code. In our opinion therefore the lower appellate court was wrong in holding that Order II, Rule 2 applied to the suit.

17. As a result of the finding reached by us, namely, that the notice given under Section 111 , Clause (h) must be deemed to have been waived and there was no determination of the lease and further that an intention on the part of the lessor to treat the lease as subsisting was manifest by their own action or conduct, this second appeal in our opinion has got no force and we accordingly dismiss it with costs.