PETITIONER: SENJEEVANAGAR MEDICAL & HEALTHEMPLOYEES CO-OPERATIVE HOUSING Vs. RESPONDENT: <NAME> & ORS. DATE OF JUDGMENT: 08/02/1996 BENCH: <NAME>, K. BENCH: <NAME>, K. AHMAD SAGHIR S. (J) G.B. PATTANAIK (J) CITATION: 1996 SCC (3) 600 JT 1996 (2) 173 1996 SCALE (2)82 ACT: HEADNOTE: JUDGMENT:

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

This appeal by special leave arises from the judgment of <ORG> made in Writ Appeal No.692 of 1982 on March 2, 1983. Notification under Section 4 [1] of the Land Acquisition Act [1 of 1894] [for short, "the Act"] acquiring the lands in question to provide house sites to Class IV employees of the appellant-Society, was published in <ORG> on January 11, 1979. The substance of the notification was published in the locality on march 17, 1979. Enquiry under Section 5A of the Act was conducted and the Land Acquisition Officer [<ORG>] submitted his report to the Government on June 19, 1979. Declaration under Section 6 was published on March 29, 1980. The <ORG> after conducting enquiry made his award under Section 11 on December 13, 1980 and notice thereof was served on the respondents. It is stated that since the respondent did not attend the office of the <ORG>, as directed, on January 1, 1981, the compensation was deposited in the court of the Subordinate Judge. It is stated that after <ORG> had taken possession of the land from the respondents, he had handed over the land to the appellant but actual date was not mentioned. It is also stated by the appellants that thereafter plots were laid out and were allotted to its members and some members had started construction of their houses. At that stage, the respondents had filed the writ petition on August 9, 1982 and the Full Bench following its judgment in <CITATION> .[(1983) 1 DLT 233] quashed the notification and the declaration holding that the notifications under Section 4(1) were not simultaneously published in the Gazette and in the locality.

Thus this appeal by special leave. <NAME>, learned senior counsel for the appellant contended that in <CITATION> [(1985) 1 SCR 588] this Court had overruled the <ORG> decision in <NAME>'s case and approved of the ratio in various <ORG> judgments of that Court referred therein. The <ORG> legislature amended the Act by Land Acquisition [Andhra Pradesh Amendment and Validation] Act, 1983 [Act 9 of 1983] [for short, "the Validation Act "] giving retrospective effect, viz., w.e.f. September 12, 1975, the date on which the Land Acquisition [Andhra Pradesh Amendment] Act, 1976 had come into force. Though the Validation Act retrospectively prescribes publication of the substance of the Section 4  notification within 40 days from the date of its publication in <ORG>, the publication of the substance even after 40 days does not become invalid by the ratio in <NAME> case and by operation of clause [b] of Section 4 of the Validation Act. He also contended that since possession had already been taken, after the award was made, the land stood vested in the <ORG> and the beneficiaries, free from all encumbrances. <ORG>, therefore, was not right in its quashing Section 4  notification and Section 6 declaration. It is also contended that the Land Acquisition [Amendment] Act [68 of 1984] provides procedure for publication of the notification in the <ORG>, newspapers and the local publication and limitation for publication of the declaration under Section 6 within one year from last of the dates of the publication under Section 4  which would indicate that various publications under Section 4  could be done at periodical intervals without time limit within the maximum period of one year. The Validation Act thereafter also does not hold the field.

<NAME>, learned counsel for the respondents contended that after the Validation Act was given retrospective effect from September 12, 1975 and local publication made after 40 days, the notification under Section 4  became invalid; consequently, the declaration under Section 6 is not est. He placed reliance on <CITATION> . [] and <CITATION> . [] the ratio wherein it was held that local publication after 40 days invalidates Section 4  notification. The respective contentions give rise to the question: whether the view of <ORG> is correct in law? The Land Acquisition [Andhra Pradesh Amendment] Act, 1976 was enacted with a view to accelerate the pace of acquisitions to provide house sites to the poor and to empower the Collectors to issue notification under Section 4 [11 and the declaration under Section 6 and their publication in the respective district Gazettes and to make payment of compensation to the lands so acquired if the compensation does not exceed Rs.500/- and in other cases in installments not exceeding Rs.500/- with interest at 6% on such installments.

In furtherance thereof, acquisition of the lands of private persons on massive scale was undertaken in all the districts of the State. Collectors exercised power under Section 17  dispensing with the enquiry under Section 5A and notifications under Section 4 [11 and declarations under Section 6 were simultaneously published in the <ORG>. But the officers at the lower level delayed publication of the notification under section 4  Consequentially, spate of litigation had sprung up in <ORG> invariably challenging the validity of the notifications.

As noticed by this Court in <NAME> case [supra], several <ORG> of <ORG> have taken consistent view that simultaneous publication of the notification under Section 4  in the <ORG> and local publication of its substance was not mandatory. A single Judge and <ORG> had struck a discarded note leading to reference to <ORG> which in <NAME>'s case had held that the publication of the notification in the <ORG> and the local publication of its substance should be done on the same day. Following that view, the same <ORG> quashed the impugned notification and declaration covered in that appeal. The Validation Act expressly referred the said decision and validated with retrospective effect all the notifications issued earlier than the date on which the A.P. Amendment Act, 1976 came into force, removing the base of <ORG> judgment. Section 2 of the Validation Act provides that the Collector shall, within 40 days from the date of the publication of such notification, cause the substance of the notification published. This led to further litigation.

A three-Judge Bench was required to consider whether delay in giving public notice in the locality makes the notification invalid. <NAME>'s case was cited in support of the contention. Therein a combined notification under Sections 4 and 17(4) and declaration under Section 6 were published in the <ORG> on June 18, 1984 and public notice of the substance of the notification under Section 4 was given in the locality on July 17, 1984 with a delay of 29 days. Post-notification delay of eight years due to inter- departmental correspondence was pressed into service to hold that there was no real urgency. Legality of invoking urgency clause and consequential omission to hold enquiry under Section 5A was under challenge.

This Court had held that Section 4  does not prescribe that public notice of the substance of the notification should be given in the locality simultaneously with the publication of the notification in the Official <ORG> or immediately thereafter. They are two steps required to be taken under Section 4  before taking further steps under sub-section . The time factor is not a vital element and there is no warrant to read the words 'simultaneously' or 'immediately thereafter' in Section 4 . They are not required to be done simultaneously or immediately thereafter. Contemporaneity may involve a gap of time and by the very nature of the things, the publication in the Official <ORG> and the public notice in the locality must necessarily be separated by a gap of time. This does not mean that the publication and the public notice may be separated by a long interval of time. What is necessary is that the continuity of action should not appear to be broken by a deep gap. If there is publication in the <ORG> and if there is public notice in the locality, the requirements of Section 4  must be held to be satisfied unless the two are unlinked from each other by a gap of time so long as it may lead one to the prima facie conclusion of lack of bona fides in the proceedings for acquisition. It was held that when the Government exercises power under Section 17 , it obviously feels that urgency is such that it does not brook delay and, therefore, the Government directs that possession of the land be taken immediately on publication of the declaration under Section 6 and followed by notice under Section 9 . Delay of eight years on the part of the tardy officials to take further action in the matter of acquisition is not sufficient to nullify the urgency which existed at the time of issuing the notification and to hold that there was never any urgency. This Court overruled the <ORG> judgment in <NAME>'s case [supra] and approved of the <ORG> judgments of <ORG>, apart from other cases.

In <NAME> case and <NAME> cases [supra] this Court considered the effect of the Validation Act and another Bench of three Judges held that after the Validation Act had come into force with retrospective effect, despite the law in <NAME> case, the Validation Act is required to be given effect. Notification and public notice of the substance thereof has to be given in the locality within 40 days from the date of the publication of Section 4  notification which would apply to every notification issued by the appropriate Government after September 12, 1975. ln case the substance of such notification was not given in the locality within 40 days from the date of the publication of the notification in the <ORG>, it would introduce a fatal infirmity invaliding such notification. In that case a delay of more than 40 days in the local publication of the substance of the notification violated the mandate enacted in sub-section  of Section 4 as it stood from and after September 12, 1975. Therefore, it was liable to be struck down.

The <ORG> enacted Amendment Act 68 of 1984 prescribing the procedural steps in publication of the notification under Section 4  and declaration under Section 6 without prescribed time limit with consequences of non- compliance thereof and in Section 11A declaring that if the steps respectively prescribed therein are not taken, the acquisition entails lapse. In other words, The parliament evinces that neither simultaneous nor immediate local publication of substance is insisted upon. But compliance thereof and publication in two newspapers are required to be done. The object is to put the owner or interested person on notice of acquisition of the land for public purpose. In case of enquiry under Section 5A it should also be done and all the steps should be taken within one year from the last of the dates of the publication of notification under Section 4 . Otherwise the acquisition stands lapsed. Even thereafter award should be made within two years from the date of the publication of Section 6 declaration. Publication of Section 4(1) notification in <ORG>, its substance in the locality and also publication of the notification in two local newspapers is envisaged but no time limit for their compliance has been prescribed thereunder. if urgency power under Section 17  is not invoked, notice under Section 5A is required to be given to the owner and then enquiry is conducted after giving opportunity to the owner or interested person. Thereafter, declaration should be published within one year from last of the dates of the publication under Section 4 . In other words, from September 24, 1984, all the prescribed procedural steps should be done but without time schedule. The declaration should be published within one year. Maximum outer limit was prescribed. The Central Act 68 of 1984 and Validation Act were enacted under Entry 42 of List III [Concurrent List of the Seventh Schedule to the Constitution. By operation of proviso to Article 254 of the Constitution, the Amendment Act 68 of 1984 is made operative and it has occupied the same field w.e.f. September 24, 1984. <CITATION> . [] this Court surveyed the effect of the Amendment Act vis-a- vis the U.P. Awas Evan Vikas Parishad Adhiniyam, 1965 and held in paragraphs 39 and 40 that unless both the Acts are inconsistent and cannot operate harmoniously, the State Act prevails over the Central Act but to the extent of repugnancy the State Act becomes void since it is not fully consistent with the provisions of the Amendment Act . In that case, it was held that they were intended to act independently since the State law was enacted under Entries 56 and 66 of List II [State List] while the Amendment Act was enacted under Entry 42 of the Concurrent List.

The rigor of 40 days thereby under the Validation Act got diffused w.e.f. September 24, 1984 since it is inconsistent with Amendment Act 68 of 1984. It would be seen that the Validation Act relates to acquisition of the land for providing house sites to the poor thereunder the urgency power under Section 17  was invoked and possession was not taken. The notification under Section 4  and declaration under Section- 6 were simultaneously published. But public notice of the substance of the notification was not given simultaneously. But for the <ORG> decision, law did not insist upon simultaneous action which was an impossibility and concept of simultaneous action was judicial interpretation and its effect was diffused by Validation Act . It is to remember that the acquisition was to provide housing accommodation to the poor. The State Government always exercise the power of publishing the notification under Section 4  and the declaration under Section 6 for acquiring the properties in urban areas. The enquiry under Section 5A was not dispensed with. The declaration under Section 6 was published only after the enquiry under Section 5A had been conducted as in the present case. The need, therefore, to make simultaneous local notice of the substance was not the requirement of law and was not declared by this Court in <NAME> case [supra and also several decisions of various Division Benches of the High Courts. The <ORG> judgment was primarily in relation to the lands in rural areas to provide house sites to the poor. The <ORG> also did not notice the distinction since common question was argued and the main concentration was only of the acquisitions for providing house sites to the poor. The same was repeated in <NAME> case [supra]. <NAME> cases [supra] closely followed the heels of <NAME> case. Therefore, the Validation Act was not applicable to the acquisition made pursuant to the notification published by <ORG> in its <ORG>.

That apart, as facts disclose, the award was made on November 24, 1980 and the writ petition was filed on August 9, 1982. It is not in dispute that compensation was deposited in the court of the Subordinate Judge. lt is asserted by the appellant- Society that possession of the land was delivered to it and the land had been divided and allotted to its members for construction of houses and that construction of some houses had been commenced by the date the writ petition was filed. It would be obvious that the question of division of the properties among its members and allotment of the respective plots to them would arise only after the Land Acquisition Officer had taken possession of the acquired land and handed it over to the appellant-Society. By operation of Section 16 the land stood vested in the State free from all encumbrances. <CITATION> .[], the question arose: whether notification under Section 4 and the declaration under Section 6 get lapsed if the award is not made within two years as envisaged under Section 11A ? A Bench of three Judges had held that once possession was taken and the land vested in the <ORG>, title to the land so vested in the State is subject only to determination of compensation and to pay the same to the owner. Divesting the title to the land statutorily vested in the <ORG> and reverting the same to the owner is not contemplated under the Act. Only Section 48(1) gives power to withdrew from acquisition that too before possession is taken. That question did not arise in this case. The property under acquisition having been vested in the appellants, in the absence of any power under the Act to have The title of the appellants divested except by exercise of the power under Section 48(1) , valid title cannot be defeated. The exercise of the power to quash the notification under Section 4(1) and the declaration under Section 6 would lead to incongruity. Therefore, <ORG> under those circumstances would not have interfered with the acquisition and quashed the notification and declaration under Sections 4 and 6 respectively. Considered from either perspective, we are of the view that <ORG> was wrong in allowing the writ appeal.

Consequentially, the writ appeal stands dismissed and the order passed by the learned single Judge in the writ petition stands restored. The appeal is accordingly allowed, but, in the circumstances, without costs.


PETITIONER: <NAME> Vs. RESPONDENT: <NAME> AND ORS. DATE OF JUDGMENT17/07/1974 BENCH: <NAME>, <NAME> BENCH: <NAME>, <NAME> SARKARIA, RANJIT SINGH CITATION: 1974 AIR 1728 1975 SCR (1) 534 1974 SCC (2) 323 CITATOR INFO : RF 1986 SC1370 (69,77,80) RF 1988 SC 782 (65) RF 1988 SC1353 (3) ACT: Transfer of Property Act , 1882  ss. 6 , 122 and 123- -Gift of shares in companies by registered gift deed--Transfers not effected before donor's death--No question of competing equities--Whether rights of ownership can be split into right to corpus and usufruct. Indian Companies Act , 1913--S. 28--Reg. 18 of Table A "title to get on the register" and "the full property in the shares in a company"--Distinction. Interpretation--Harmonious interpretation. HEADNOTE: By a registered deed, a donor gifted to the appellant shares in various limited companies. Before her death the donor had signed several blank transfer forms to enable the done to obtain transfer of the shares in the register of companies and share certificates in his name. She had signed at the correct places showing that she meant to sign transfer of shares but the transfer could not be effected before the donor's death. The respondent claiming the shares filed an administration suit. A single Judge of <ORG> held that the appellant was entitled to shares covered by the gift deed to which blank transfer forms could be related. A division bench of <ORG> reversed the decision of the Single Judge on the ground that the gift was incomplete for failure to comply with the formalities prescribed by the Indian Companies Act , 1913 for transfer of shares. It further held that there was no equity in favour of the appellant so that he may claim the right to complete what was left incomplete by the donor in her life-time. On appeal it was contended in this Court (1) that since the donor had signed the blank transfer forms and handed them over to the done, the gift deed and the signed blank forms had to be read together and (2) that the transfer was complete with the registration of the gift deed and even delivery of share certificates to the done was not necessary in view of s. 122 of the Transfer of Property Act. Allowing the appeal, HELD:(1) The respondent has not made out a case for defeating the clearly expressed intentions of the donor, coupled with the authority with which the donor was armed by reason of the signed blank transfer forms. On a correct interpretation of the gift deed and other material the right to obtain a transfer of shares was clearly and completely obtained by the donee appellant. There was no question of competing.equities because the donee appellant was shown to have obtained a complete legal right to obtain shares under the gift deed and an implied authority to take steps to get his name registered. [549B-D] The fact that the relevant provisions of the Transfer of Property Act and the Companies Act must be interpreted harmoniously does not mean that a provision of one Act could be nullified by any provision of the other Act. It means that the provision of the two Acts should be read consistently with each other so far as it is reasonably possible to do so. This end can be best achieved by examining the objects and the subject-matter of each enactment and by viewing each relevant provision as a limb of an integrated whole meant to serve the underlying purposes. In this way their separable spheres of operation will be clarified so as to avoid possibilities of conflict between them or any unnecessary overflow of what really appertains to one field into another. [539H-540B] (2) The Transfer of Property Act is an enactment meant for defining certain basic types of transfers and lays down the requirement both of substance and of form for their legal recognition and effectiveness. Section 5 of the Act gives a wide connotation to "transfer of property". Section 6 of the Act lays down that "property of any kind may be transferred" subject to certain exceptions. Shares in a company are certainly a form of property. Section 28 of the Companies 535 Act, 1913 says that they "shall be movable property, transferable in the manner provided by articles of the Company". A wide definition of "property" in s. 6 of the Transfer of Property Act includes not merely shares as transferable, movable property. but would cover as a separate form of property a right to obtain shares which may be antecedent to the accrual of rights of a shareholder upon the grant of a share certificate in accordance with the articles of association of a company. [540B-E] There is a distinction between "the title to get on the register" and "the full property in the shares in a company". The first is acquired by mere delivery, with the required intention of the share certificate and a blank form signed by the transfer. The second is only obtained when the transferee, in exercise of his right to become a shareholder, gets his name on the register in place of the transferor. This antecedent right in the person to whom the share certificate is given with a signed blank transfer form under a transaction meant to confer right or title upon him to become a shareholder is enforceable so long as no obstacle to it is shown to exist in any of the articles of association of a company or a person with a superior right or title, legal or equitable, does not appear to be there. Section 6 of the T.P. Act justifies such a splitting up of rights constituting property in shares just as it is well recognised that rights of ownership of property may be split up into a right to the "Corpus" and another to the "usufruct" of the property and then separately dealt with. [541C- <CITATION> . 53 Indian Appeals P. 92 @ 97-98, relied on. Section 122 of the Transfer of Property Act defines a "gift". Section 123 of the T. P. Act prescribes the mode of transfer by gift. No special mode of delivery is specified in the section. On the other hand it is indicated that the delivery "may be made in such a way as the goods sold are delivered". [541E-G] In the instant case the registered document was signed both by the donor and donee and is attested by witnesses. The donor specified and gave particulars of the shares meant to be gifted. The donor delivered the registered gift deed together with the share certificates to the donee. On these facts the donation of the right to get share certificates made out in the name of the donee became irrevocable by registration as well as by delivery. The actual transfers in the registers of the companies concerned were to constitute mere enforcement of this right. They were necessary to enable the donee to exercise the rights of the shareholder. The mere fact that such transfers had to be recorded in accordance with the Company Law did not detract from the completeness of what was donated. [541G-542B] The broadly indicated requirements of regulation 18 of Table A of 1st Schedule to the Companies Act , 1913 were also complied with by the contents of the gift deed. It is immaterial that the gift deed deals with a number of items so long as the requirements of Regulation 18 are fulfilled. The observance of a form whether found in the Transfer of Property Act or in the Companies Act is meant to serve the needs of the substance of the transaction which were undoubtedly shown to have been completely fulfilled here. There is nothing in Regulation 18 to indicate that without strict compliance with some rigidly prescribed form, the transaction must fail to achieve its purpose. The subservience of substance of a transaction to some rigidly prescribed form required to be meticulously observed, savors of archaic and outmoded jurisprudence. [543G-544A] Re Nose, Midland Bank Executer & Trustee Co. Ltd. v. <NAME>. 1949 Ch. D. 78, Re <NAME>, <NAME> v. <ORG>, 1932 (1) Ch.D. 499, <CITATION> ,  Supp. (2) SCR 448 @ 453 referred to. JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2515 of 1973, (From the judgment and Decree dated the 11th/12th July, 1972 of <ORG> in L.P. A. No. 40 of 1969.) <NAME>, <NAME> and <NAME> for the appellant. <NAME>, <NAME> and <NAME> for respondent No. 1.

The Judgment of the Court was delivered by <ORG> This appeal, after certification by <ORG> of fitness of the case for it, I rises in the following circumstances:

<NAME>, a flourishing lawyer, made a will, on 10-6-1945 and died childless on 20-8-1946. His widow, <NAME>, obtained, under the will, inter alia, certain shares the right and title to which are disputed before us. On 6-3-1948, <NAME> executed a registered gift deed purporting to donate the disputed shares in various limited companies, of which details were given in the gift deed, to her brother, <NAME>, the appellant before us (hereinafter referred to as "<NAME>"). On 18-4- 1948, <NAME> also expired. But, before she died, she had signed several blank transfer forms,apparently intended to be filled in by donee so as to enable him. to obtain the transfer of the donated shares in the registers of the various companies and share certificates in his own name. She had put her signatures in the correct places showing that she meant sign as the transferor of the shares. The shares could not, however, be transferred in the registers of the various companies, in accordance with the relevant provisions of Company law, before the lady's death. Therefore, the respondent before us, <NAME>, a nephew of the late <NAME>, disputed the claim of the appellant Vasudev Ramchandra <NAME> to these shares in an administration suit which came up before a learned Judge of <ORG> in second appeal together with other matters. The learned Single Judge held that <NAME> was entitled to the shares covered by the registered gift deed to which the blank transfer forms could be related but not to others said to have been orally gifted with which we are not concerned here. The learned Judge having granted leave to file a Letter's Patent Appeal, <ORG> of <ORG>, which considered the rival claims, reversed the decision of the learned Single Judge even with regard to the shares covered by the registered gift deed on the ground that the gift was incomplete for failure to comply with the formalities prescribed by the Companies' Act for "transfer" of shares. It held-that there was no equity in favour of <NAME> so that he may claim a right to complete what was left incomplete by the donor in her lifetime even though there could be no doubt that <NAME> had intended to donate the shares to <NAME>.

We think Mr. <NAME>, learned Counsel for the appellant <ORG>, rightly pointed out that every material finding on questions of fact, given in favour of the appellant, was upheld by <ORG>. After indicating the terms of the gift deed, <ORG> held:

"Thus, it is undoubtedly true that the deed of gift discloses a clear and unequivocal intention on the part of <NAME> that <NAME> should become the owner of these shares and he should for all future time enjoy the fruits thereof. it is a well settled position in law that unless the gift it completed as required by law, mere intention to make a gift cannot pass any title to the donee and does not make the donee the owner of the property gifted by the donor. The registered gift deed itself cannot create any transfer and so it was not competent to the donor to divest the title in her merely by the execution of the gift deed. She was required to execute the regular transfer deeds or instruments of transfer in favour of <NAME> Shelat and hand them over to the donee, <NAME> Shelat, together with the share certificates."

It went on to say:

"The circumstances as they clearly emerge and the facts as found by the Courts below, go to show that the deed of gift was executed on March 6, 1948, and, at the same time, the re- levant share-certificates were handed over by the donor to the donee; and, sometime between March 6, 1948, when the gift deed was executed, and April 18, 1948, when <NAME> died blank transfer forms signed by <NAME> were handed over by <NAME> to <NAME>, the donee."

The appellant's submissions, on facts found, may be summarised as follows:

(1) As between the donor and the donee the transfer was complete with the registration of the gift deed; and, as there was a registered document, even delivery of share certificates to the donee was not necessary in view of Section 122 Transfer of Property Act.

(2) Assuming, without conceding that the donor had to do something more than to execute a registered document, this too was done when the shares certificates and the signed "blank transfer" forms were handed over to the donee by the donor. It did not matter if the name of the donee and other particulars are wanting in these blank forms. All necessary particulars of shares involved were expressly mentioned in the gift deed which specifies and identifies each individual share meant to be donated. The gift deed and the signed blank forms had to be read together. The donor had done all that reasonably lay with- in her power to complete the donation.

(3)The conduct of the donor, in handing over the share certificates to the donee and the blank transfer forms, read in the context of the expressly laid down intentions of the donor in the gift deed, raised the presumption of an implied authority to fill in the details and to submit to the companies concerned the forms given by the donor to <NAME> before her death.

(4) There was no evidence whatsoever in the case to repel the irresistible inference of an implied authority given to the donee to fill in and submit the transfer forms so as to obtain the necessary entries in the registers of the various companies concerned.

(5) <ORG> had, after giving all the necessary findings of fact in favour of the appellant, misdirected itself by resorting to the doctrine that there is no equity to complete an incomplete transaction, as there is when a bonafide purchaser for value comes before the <ORG>.

There was no question of any equity involved here. The simple question was one of fact. Did the inference of an implied authority of the donee to fill in the forms and take other steps necessary to get his name entered in the registers of shareholders arise or not? Instead of considering and deciding whether such an inference arose, <ORG> had failed to decide the real issue on the erroneous view that equity debars it from inferring an implied authority because the donee, unlike a bona fide purchaser for value, had paid nothing for the rights he could get from the donor.

All that could be urged on behalf of the respondent may be summed up as follows :

(1) The facts found make out, at best, an intention of <NAME> to donate but not the completion of a donation required by law for divesting the donor of interest in the property under consideration which consisted of shares. (2) Although shares are goods, as defined by the Sale of Goods Act , yet, they are 'goods' of a special kind. Their transfer is not completed merely by the execution of a registered document or by delivery but the correct mode of transfer is determined by the character of these "goods" Sec. 123 of the Transfer of Property Act lays down only a general mode of transfer by gift for goods in 'general but not for the transfer by gift of shares which are a special type of 'goods' capable of transfer only in accordance with a special mode prescribed by the Companies Act of 1913, which was applicable at the relevant time. In other words, an adoption of the prescribed form of transfer is of the essence of a transfer for all purposes and not merely as between the shareholder and the company concerned. (3) Sections 122 & 123 of the Transfer of Property Act had to be read harmoniously with Sections 28 and 34 of the Companies Act, 1913.

(4) Since material portions of the transfer form given in regulation 19 of Table A of the first Schedule of the Companies Act of 1913 were never filled in, the doctrine of "substantial compliance" with the required form could not come to the aid of the appellant.

(5) The gift deed itself does not empower the donee to take any of those steps which remained to be taken to complete the 'transfer', so that the doctrine of implied authority would be excluded by the ex. press terms of the gift deed which not only do not confer any such authority Upon the donee but indicated that the donor was to take the necessary steps herself.

(6) Inasmuch as acceptance of the gift "during the life- time of the donor" is a condition precedent to the validity of the gift as a transaction, and the appellant <NAME> did not apply for the transfer of shares, so as to indicate his acceptance of the gift before the dono died, the purported donation was frustrated by reason of Sec. 122 of of the Transfer of Property Act .

(7) Even if we were to assume that the facts proved disclosed that the appellant donee was armed with an implied authority to obtain a transfer, yet that authority not having been acted upon during the life-time of the donor, lapsed with the donor's death. The result was that the donation, even if intended, was imperfect or infructuous in the eye of law and could not be perfected or completed. Equity does not aid a merely purported donee who has given no consideration to obtain any right. In other words, equitable considerations would not be irrelevant in deciding the question before us.

(8)Even apart from equity, under the law of agency, found in sec. 201 of our Contract Act , the Principal's death terminates the agency, so that the doctrine of implied authority does not help the appellant.

(9) Section 202 of the Contract Act could not apply to a case where the subject-matter of the alleged agency is the taking of steps to complete a transfer and not the rights which could only accrue after the necessary steps are taken. Hence, the appellant donee could not be said to have an interest in the "subject-matter of the agency" which is distinct from rights which could have arisen if the object of the agency had been fulfilled.

(10) Section 202 of the Contract Act could apply to a case where an agent has an actual or existing interest in the subject-matter of the agency. Even if the subject-matter of the agency could be said to be "Property", consisting of shares, there could be no question of applying Section 202 of the Contract Act before an "'merest" in the shares arose. Such "interest" could only arise after a completed transfer. (11) Section 202 of the Contract Act contemplated cases of termination of agency in ways other than death. It meant that, so long as a Principal is alive, he could not terminate an agency so as to injure the interests of the agent in "the subject matter of the agency". But, in the case of the death of the Principal, the relationship terminated ipso facto or automatically by death. (12) A resort to the very concept of agency in this case presupposes that some interest of the Principal or the donor in the property said to be donated continued,-or, in other words, the assumption behind it was that the donation of shares was not complete in the eye of law. Its completion was not possible after the death of the donor. We think that questions to be really decided in the case before us have tended to become needlessly clouded by references to statutory provisions and to doctrines or concepts which really operate in separate and distinct fields of their own. It is true that the relevant provisions of the Transfer of Property Act and the Companies Act must be interpreted harmoniously. But, this certainly does not mean that a provision of one Act could be nullified by any provisions of the other Act. It means that the provisions of the two Acts should be- read consistently with each other so far as it is reasonably possible I to do SO.

<NAME>

We think that this end can be best achieved here by examining the objects and the subject-matter, of each enactment and by viewing each relevant provision as a limb of an integrated whole meant to serve the underlying purposes. In this way, their separable spheres of operation will be clarified so as to avoid possibilities of conflict between them or any unnecessary overflow of what really appertains to one field into another.

No doubt the Transfer of Property Act is not exhaustive. It does not deal with every kind of transfer of property which the law permits. Nor does it prescribe the mode for every legally recognised transfer. Nevertheless, it is an enactment meant for defining certain basic types of transfer and it lays down the requirements both of substance and of form for their legal recognition and effectiveness. Section 5 of this Act gives a wide connotation to "transfer of pro- perty". All that it requires is that the transferor must be living at the time of the transfer recognised by the Act. Section 6 of the Act lays down that "property of any kind may be transferred" subject to certain exceptions. Shares in a company are certainly a form of property. Section 28 of the Companies Act, 1913, says that they "shall be movable property, transferable in the manner provided by the articles of the company". Both sides accept as correct the view of <ORG> of <ORG>-that the shares are "goods" within the meaning of the Sale of Goods Act . The point which, however, deserves to be noted here is that wide definition of "property" in Section 6 of the Transfer. of Property Act includes not merely shares as transferable, movable property, but would cover, as a separable form of property, a right to obtain shares which may be antecedent to the accrual of rights- of a shareholder upon the grant of a share certificate in accordance with the articles of <ORG>.

<CITATION> .(1) which was a case of handing over share certificates together with blank signed transfer forms, <ORG> said (at p. 97-98):

"But" further, there seems to their Lordships a good deal of confusion arising from the prominence given to the fact that the full property, in shares in a company is only in the registered holder. That is quite true. It is ture that what <NAME> had was not the perfect right of property, which he would have had if he had been the registered holder of the shares which he was selling. The company is entitled to deal with the shareholder who Is on the register, and only a person who is on the register is in the full sense of the the word owner of the share. But the title to get on the register consists in the possession of a certificate, together with a transfer signed by the registered holder. This is what <NAME> had. He had the certificates and blank transfers, signed by the registered holders. It would be an upset of all <ORG> transactions if it were suggested that a broker who sold shares by general description (1) 53 Indian Appeals P. 92 @ P. 97-98.

did not implement his bargain by supplying the buyer with certificates and blank transfers, signed by the registered holders of the shares described. <NAME> sold what he had got. He could sell no more. He sold what in England would have been chooses in action, and he delivered chooses in action. But in India, by the terms of the Indian Contract Act , these chooses in action are goods. By the definition of goods as every kind of movable property it is clear that not only registered shares, but also this class of chooses in action, are goods. Hence, equitable considerations not applicable to goods do not apply to shares in India."

Thus, we find that, in <NAME>'s case (supra), a distinction was made between "the title to get on the register" and "the full property in the shares in a <ORG>.,' The first was held to have been acquired by mere delivery, with the required intention, of the share certificate and a blank form signed by the transferor. The second is only obtained when the transferee, in exercise of his right to become a shareholder, gets his name on the register in place of the transferor. This antecedent right in the person to whom the share certificate is given with a signed blank transfer form under a transaction meant to confer right or title upon him to become a shareholder, is enforceable so long as no obstacle to it is shown to exist in any of the articles of association of a company or a person with a superior right or title, legal or equitable does not appear to be there. We think that Section 6 of the Transfer of Property Act Justifies such a splitting up of rights constituting " property" in shares just as it is well recognised that rights of ownership of a property may be split up into a right to the "corpus" and another to the "usufruct" of the property and then separately dealt with. Sec. 122 of the Transfer of Property Act defines a ",gift". its substantial requirements are : (1) the donor must transfer "property", which is the subject-matter of the gift, voluntarily and without consideration; (2) and, the donee must accept it during the life-time of the donor or while the donor's competence to give exists. Section 123 of the Transfer of Property Act prescribes the mode of transfer by gift. It lays down that "the transfer may be effected either by registered instrument signed by the donor and attested by at least two witnesses or by delivery". No special mode of delivery is specified. On the other hand, it is indicated that the delivery "may be made in such a way as the goods sold are delivered".

In the case before us, the registered document was signed by the donor as "the giver" as well as by the donee as "the acceptor" of the gift, and it is attested by six witnesses. In it, the donor specified and gave particulars of the shares meant to be gifted and undertook to get the name of the donee put on to the registers of the companies concerned. The donor even said that she was, thenceforth, a trustee for the benefit of the donee with regard to the income she may get due to the fact that her name was still entered in the registers of the companies concerned as a shareholder. The donor delivered the registered gift deed together with the share certificates to the donee. We think that, on these facts, the donation of the right to get share certificates made out in the name of the donee became irrevocable by registration as well as by delivery. The donation of such a right, as a form of property, was shown to be complete so that nothing was left to be done so far as the vesting of such a right in the donee is concerned. The actual transfers in the registers of the companies concerned were to constitute mere enforcements of this right. They were necessary to enable the donee to exercise the rights of the shareholder. The mere fact that such transfers had to be recorded in accordance with the company law did not detract from the completeness of what was donated. We think the learned Counsel for the appellant rightly contended that, even in the absence of registration of the gift deed, the delivery of the documents mentioned above to the donee with the clear intention to donate, would be enough to confer upon the donee a complete and irrevocable right, of the kind indicated above, in what is movable property. He relied upon : <CITATION> .(1); <CITATION> ;(2) Firm Sawan Mat Gopi Chand v. <NAME>).

The requirements of form or mode of transfer are really intended to ensure that the substantial requirements of the transfer have been satisfied. They subserve an object. In the case before us, the requirements of both Section 122 and Section 123 of the Transfer of Property Act were completely met so as to vest the right in the donee to obtain the share certificates in accordance with the provisions of the Company law. We think that such a right is in itself "property" and separable from the technical legal ownership of the shares. The subsequent or "full rights of ownership" of shares would follow as a matter of course by compliance with the provisions of Company law. In other words, a transfer of " 'property" rights in shares, recognised by the Transfer of Property Act , may be antecedent to the actual vesting of all or the full rights of ownership of shares and exercise of the rights of shareholders in accordance with the provisions of the Company law.

The Companies Act of 1913 was meant "to consolidate and amend the law relating to trading companies and other associations". It is concerned with the acts and proceedings relating to the formation, running, and extinction of companies, with rights, duties, and liabilities of those who are either members or officers of such companies, and of those who deal with companies in other capacities. Its subject-matter is not transfer of property in general. It deals with transfers of shares only because they give certain rights to the legally recognised shareholders and imposes some obligations upon them with regard to the companies in which they hold shares. A share certificate not merely entitles the shareholder whose name is found on it to interest on the share held but also to participate in certain proceedings relating to the company (1) 54 I. A. 89.

(2) ILR 52 Bom. 313.

(3) AIR 1924 Lab. 173.

concerned. It is for this purpose that Section 34 of the <ORG>mpanies Act, 1913 enables the making of "an application for the registration of the transfer of shares in a <ORG>......... either by the transferor or the transferee". A share certificate is a prima facie evidence, under Sec. 29 of the Act, of the title to a share. 'Sec. 34 of the Act does not really prescribe the mode of transfer but lays down the provisions for "registration" of a transfer. In other words, it presupposes that a transfer has already taken place. The manner of transfer of shares, for the purposes of <ORG>mpany law, has to be provided, as indicated by Sec. 28, by the articles of the <ORG>mpany, and, in the absence of such specific provisions on the subject, regulations contained in Table 'A' of the 1st Schedule of the <ORG>mpanies Act apply.

Table 'A' of the 1st Schedule to the Companies Act of 1913 gives regulation 19 as follows "19. Shares in the company shall be transferred in the following form, or in any usual or common form which the directors shall approve :

1, A. B. of in consideration of the sum of rupees paid to me by <NAME> (hereinafter called "the said transferee"), do hereby transfer to the said transferee the share (or shares) numbered in the undertaking called <ORG>, to hold unto the said transferee, his executors, administrators and assigns, subject to the several conditions on which I held the same at the time of the execution thereof, and I (the said transferee) do hereby agree to take the said share (or shares) subject to the conditions aforesaid. As witness our hands the day of Witness to the signatures of, etc."

Apparently, the form given here is only for sales. In the case of a gift the more general provisions of regulation 18 would apply. This regulation says :

"The instrument of transfer of any share in the company shall be executed both by the transferor and transferee, and the transferor shall be deemed to remain holder of the share until the name of the transferee is entered in the register of members in respect thereof." We find from the gift deed that both the donor and the. donee have signed the document, under two headings respectively : "giver of the gift" and "acceptor of the gift". Hence, we think that the broadly indicated requirements of regulation 18 were also complied with by the contents 'of the gift deed.- It is immaterial that the gift deed deals with a number of items so long as the requirements of regulation 18 are fulfilled. After all, the observance of a form, whether found in the Transfer of Property Act or in the Companies Act , is meant to serve the need of the substance of the transaction which were undoub- tedly shown to have been completely fulfilled here. There is nothing in regulation 18 or anywhere else in our Company law to indicate that, without strict compliance with some rigidly prescribed form the transaction must fail to achieve its purpose. The subservience of substance of a transaction to some rigidly prescribed form required to be meticulously observed savors of archaic and outmoded jurisprudence. <NAME> on the Companies Act s (XIII-Edn. p. 813) was cited before us for the proposition-that "non registration of a transfer of shares made by a donor does not render the gift imperfect". Considerable argument was advanced by both sides on the correct interpretation of the leading English case mentioned there : Re Nose, Midland Bank Executor & Trustee Co. Ltd. v. Rose,(1) where <NAME> after an exhaustive discussion of the English case law on the subject, held that when a testator had done everything that lay in his power to divest himself of his Fights in preference shares "completion of the legal title by registration could only be the act of a third party which did not affect the efficacy of the gift of shares inter- vivos". <ORG> upheld this decision in : In Be Rose V. Inland Revenue Commissioners.(2) It held that "the deceased was in the position of. a trustee of the legal title in the shares for the transferees", pending the entry of the names of the donees in a company's register and the issue of share certificates to them. In the case before us, we find that <NAME> had actually stated in the gift- deed that her position, vis-a-vis the donee, who had accepted the gift, was that of a trustee for the benefits received by her from the gifted shares until the completion of the legal formalities so that appropriate entries are made in' the registers of companies concerned and fresh share certificates are issued to the donee. We, therefore, think that this case helps the appellant. <CITATION> (3), considering a case of blank transfers, <NAME>, speaking for this Court, said (at p. 453) :

"In such blank transfers, the name of the transferor is entered, and the transfer deed signed by the transferee, who, if he so chooses, completes the transfer by entering his name and then applying to the company to register his name in place of the previous holder of the share. The company recognises no person except one whose name is on the register of members, upon whom alone calls for unpaid capital can be made and to whom only the dividend declared by the company is legally payable. of course, between the transferor and the transferee, certain equities arise even on the execution and handing over of a blank transfer', and among these equities is the right of the transferee to claim the dividend declared and paid to the transferor who is treated as a trustee on behalf of the transferee. These equities, however, do not touch the company, and no claim by the transferee whose name is not in the register of (1) [1949] Ch. D. 78. (2) [1932] (1) Ch. D. 499.

(3) [1959] Supp. (2) SCR 448 @ 453.

members can be made against the company, if the transferor retains the money in his own hands and fails to pay to it to him."

This case also makes a distinction between an antecedent right and title of the transferee under a blank transfer and the fully blossomed rights and title of such a transferee after the due registration of a transfer. Another case cited before us was : R. Subba Naidu v. Commis- sioner of Gift Tax, Madras,(1) where a distinction was made between a transfer of the antecedent right to the shares which operated with full force between a donor and the donee, "notwithstanding that, vis-a-vis the company, the donor continued to be holder of the shares in the absence of transfer of shares". In other words, the fields of operation of the provisions of Sections 122 and 123 of the Transfer of Property Act and the provisions of the Companies Act 1913 were different. Each had different objects and legal consequences. The Companies Act did not prevent the completion of a gift of the right to obtain the shares which could, in common parlance or loosely speaking, be spoken of as a gift of shares themselves even before the gift is acted upon so that the donee obtains share certificates in his own name. The Transfer of Property Act could not enable the donee to exercise the rights of a shareholder, vis-a-vis the company, until a transfer of shares is made in accordance with the Company law.

other cases cited on behalf of the appellant, which we will only mention without discussion, were

1. <ORG> v. Hepworth(2);

2. In Re. Tahiti Cotton Company ex-parte Sargent(3);

3. In Re. <ORG>);

4. In the matter of <ORG>);

5. <CITATION> - yana Rao & Ors.(6);

6. <NAME> &.Ors. v. <ORG> (7);

7. <NAME> v. <NAME> & Anr.(8).

Learned Counsel for the respondent cited the following passage from the Palmer's Company Law (21st edition-1968, p.

A transfer is incomplete until registered. Pending registration, the transferee has only an equitable right to the shares transferred to him. He does not become the legal owner until his name is entered on the, register in respect of these shares."

(1) [1969] (Vol. 73) I.T.R. 794.

(2) [1887] (36) Ch. D. 36.

(3) [1873] (17) Equity Cases 273@ 279.

(4) [1904] (1) Ch. D. 815, (5) AYR 1942 Cal. 461 @ 464.

(6) RR [1957] Mad 1958 @ 1072.

(7) AIR 1956 Pat. 32.

(8) 16 C.W.N. 666.

This statement of the law in England is correct. The transferee, under a gift of shares, cannot function as a shareholder recognised by company law until his name is formally brought upon the register of a company and he obtains a share certificate as already indicated above. indeed, there may be restrictions on transfers of shares either by gift or by sale in the articles of association. Thus" we find in Palmer's Company Law (at p. 336) :

"There is nothing to limit the restrictions which a company's articles may place on the right of transfer. The articles may give the directiors power to refuse to register a transfer in any specified cases, for instance, where calls are in arrear, or where the company has a lien on the shares-and some such provisions are usually inserted. Thus article 24 provides that the directors may decline to register any transfer of a share (not being a fully paid share) to a person of whom they do not approve, and may also decline to register any transfer of shares on which the company has a lien. But the articles in many cases go far beyond this. They may prohibit, for example, the transfer of a share to any person who is not a member of a specified class, or provide, as they often do in private com- panies, that before transferring to an outsider the intending transferor must first offer the shares to the other members, and give them a right of pre-emption. Such provisions, though permanent, do not contravene the rule against perpetuities."

In the type of cases contemplated above, where there are special restrictions on the transfer of shares imposed by the articles of association, the difficulty or defect is inherent in the character of such shares. In such cases, the donee or purchaser cannot get more than what the transferor possesses. Therefore, in such cases, it is possible to hold that even the right and title to obtain shares, which we have viewed as separable from the legal right and title to function as a shareholder, is incomplete because of a defect in the nature of shares held due to some special restrictions on their transferability under the articles of association of the company concerned. But, such is not shown to be the case at all with any of the shares which formed the subject-matter of the gift in favour of <NAME>. Hence, in our opinion, cases which deal with inchoate rights to shares do not assist the respondent because at least a gift of the right to obtain the transfer of shares in the books of the companies concerned was shown to be complete on the terms of the gift deed of <NAME> coupled with the handing over of the share certificates and the subsequent signing of the blank transfer forms. It was not a ease of a bare expression of an intention to donate. The donor had done everything which she could reasonably be expected to do to divest herself of her rights in the shares donated.

Ireland v.. Hart'(1) relied upon by the respondent, was a case in which a prior equitable title of a wife, for whom the husband was a (1) [1902] (1) C.D. p. 522 @ 529.

trustee, took precedence over the claim of a subsequent mortgagee. This case was cited in Palmer's Company Law as an instance of how delay in registration may endanger the claims of a transferee when some already existing prior equity comes to light In upholding the wife's claim of a prior equitable right the <ORG> said (at p. 529) :

"It is established by Societe Generale de Paris v. <NAME> (11 App. Case 20), <NAME> v. <NAME> (38 Ch. D. 485); and <NAME> v.

North Western Bank [1891(2) Ch. 599] that, where the articles are in the form in which they are in the present case, a legal title is not acquired as against an equitable owner before registration, or at all events until the date when the person seeking to register has a present absolute and unconditional right to have the transfer registered. I am not called upon to define the meaning of a present absolute and unconditional right, but, as it appears to me, I am not sure that anything short of registration would do except under very special circumstances. At all events, I am of opinion that in this case, prior to the date of the injunction, the defendant <ORG> had not a 'present absolute and unconditional right' to the registration of the transfer of these shares, and that the prior equitable right of the plaintiff, Mrs. <NAME>, must prevail."

Thus, what was disputed there was the right to obtain registration of a transfer of shares. The husband's power to mortgage was itself circumscribed by his position as a trustee. It was also pointed out in Palmer's Company Law (at p. 334) "It has never been clearly decided in what circumstances the `present, absolute, unconditional right to have the transfer registered' to which Lord <NAME> refers arises. It is thought that in many instances the test is that indicated by <ORG> in Re. Rose.

'I was referred on that to the well known case of <NAME> v. <NAME> and also the recent case of Re. <NAME>, Chase National Executors & Trustees Corpn. v. <NAME>. Those cases, as I understand them, turn on the fact that the deceased donor had not done all in his power, according to the nature of the property given, to vest the legal interest in the property in the donee. In such circumstances it is of course, well settled that there-is no equity to complete the imperfect gift. If any act remained to be done by the donor to complete the gift at the date of the donor's death the court will not compel his personal representatives to do that act and the gift remains incomplete and fails. In <NAME> V. <NAME> the imperfection was due to the fact that the wrong form of transfer was used for the purpose of transferring certain bank shares, The document was not the appropriate document to pass any interest in the property at all. In Re <NAME> the flaw in the transaction, Which was a transfer or transfers of shares in a certain company, was failure to obtain the consent of the <ORG> which in the circumstances surrounding the transfers in question was necessary under the Defence (Finance Regulations) Act 1939, and, as appears from the head-note, what was held was that the donor's executors ought not to execute confir-

matory transfers. In this case, as I understand it, the testator had done

everything in his power to divest himself of the shares in question to Mr. <NAME>. He had executed a transfer. It is not suggested that the transfer was not in accordance with the company regulations. He had handed that transfer together with the certificates to Mr. <NAME>. There was nothing else the testator could do.... Therefore it seems to me that the present case is not in pari materia with the two cases to which I have been referred. The real position, in my judgment, is that the question here is one of construction of the will. The testator says "if such preference shares have not been transferred to him previously to my death." The position was that, so far as the testator was concerned, they had been so transferred."

Respondent's learned Counsel also relied on Re <ORG> v. <ORG>) which has been referred to by <ORG> in the passage quoted above. In that case, apart from other distinguishing features, the flaw in the purported transfer was that it contravened the Defence (Finance Regulation) Act, 1939, which prohibited an acquisition of interest in the shares without a licence from the <ORG>. Hence, the purported transfer was really illegal. No such illegality is shown to exist in the case before us.

Respondent's learned Counsel cited <CITATION> , (2) where, after a husband had executed a document in favour of his wife, the parties had done nothing to get the transfer registered for nearly 2 years during which the dividend was received sometimes by the wife and sometimes retained by the husband with the permission or implied consent of the wife. The Court held that the purported gift being an intended "transfer" only could not operate as a "declaration of trust". Another ground for the decision was that "the disposition of the shares failed as being imperfect voluntary gift". Here, <ORG> purported to follow <NAME> v. <NAME>, (3) and, <NAME> v. Delbridge(4). No such facts are present in the case before us. Moreover, we seriously doubt the correctness of this decision of <ORG>. It seems to conflict with the law declared in the cases cited by the appellant which we approve.

Another case relied upon by the respondent was: <CITATION> . (supra), where the <ORG> refused,. to direct rectification of a register of member s (1) 1946 (2) All. E.R. 106.

(2) ILR [1921] Cal. 986.

(3) 1862 (4) DEG. F. & J. 264.

(4) 1874 LR. 18 Eq. II.

<NAME>

because the articles of association vested an absolute discretion in the company to recognise or refuse to recognise a transfer. The Company's consent to a transfer had been refused because the company did not accept the correctness of the form of transfer deeds. In other words, this was a case in which the provisions of articles of association stood in the way of rectification of the register. Such is not the case before us. The result is that We do not think that the respondent has made out a case for defeating the clearly expressed intentions of the donor coupled with the authority with which the donee was armed by reason of the signed blank transfer forms. We think that the implied authority was given with regard to a subject matter in which <NAME> had acquired an interest. On a correct interpretation of the gift deed and the other facts mentioned above, we are of opinion that the right to obtain a transfer of shares was clearly and completely obtained by the donee appellant. There was no question here of competing equities because the donee appellant was shown to have obtained a complete legal right to obtain shares under the gift deed and an implied authority to take steps to get his name registered. This right could only be defeated by showing some obstacle which prevented it from arising or which could defeat its exercise. No such obstacle having been shown to us to exist, the rights of the donee appellant would prevail as against any legal rights which could have accrued to others if the donee had not already acquired the legal right which, as held by us above, had become vested in him. We, therefore, allow this appeal with costs and set aside the judgment and decree of <ORG> of <ORG> and restore that of the learned Single Judge. Appeal allowed <NAME>

3-MI85 Sup. CI/75


Court No. - 41 Case :- CRIMINAL MISC. WRIT PETITION No. - 26708 of 2009 Petitioner :- <NAME> Respondent :- State Of U.P. And Others Petitioner Counsel :- <NAME> Respondent Counsel :- Govt. Advocate Hon'ble Imtiyaz Murtaza,J.

Hon'ble <NAME>,J.

Heard learned counsel for the petitioner learned A.G.A. appearing for the <ORG>.

The relief sought in this petition is for quashing of the F.I.R. registered at case crime no. 996 of 2009 under section 409 I.P.C. police station Kotwali City District Mirzapur.

The Full Bench of this court in <CITATION> (2006 (56) ACC 433) reiterated the view taken by the earlier Full Bench in <CITATION> (2000 Cr.L.J. 569) that there can be no interference with the investigation or order staying arrest unless cognizable offence is not ex-facie discernible from the allegations contained in the F.I.R. or there is any statutory restriction operating on the power of the Police to investigate a case as laid down by <ORG> in various decisions including <CITATION> (AIR 1992 SC

604) attended with further elaboration that observations and directions contained in <NAME> case ( <CITATION>  contradict extension to the power of <ORG> to stay arrest or to quash an F.I.R. under article 226 and the same are intended to be observed in compliance by the <ORG>, the breach whereof, it has been further elaborated, may entail action by way of departmental proceeding or action under the contempt of Court Act . The Full Bench has further held that it is not permissible to appropriate the writ jurisdiction under Article 226 of the constitution as an alternative to anticipatory bail which is not invocable in the State of U.P. attended with further observation that what is not permissible to do directly cannot be done indirectly.

The learned counsel for the petitioner has not brought forth anything cogent or convincing to manifest that no cognizable offence is disclosed prima facie on the allegations contained in the F.I.R. or that there was any statutory restriction operating on the police to investigate the case. Having scanned the allegations contained in the F.I.R. the <ORG> is of the view that the allegations in the F.I.R. do disclose commission of cognizable offence and/therefore no ground is made out warranting interference by this <ORG>. The petition is accordingly dismissed.

Order Date :- 5.1.2010 o.k.


JUDGMENT <NAME>, J.

1. W. P. No. 971 of 1962.-This is an application under Article 226 of the Constitution of India for the issue of a writ in the nature of mandamus directing the Deputy Commercial Tax Officer, <NAME>, to deliver back the goods seized by him from lorry A.P.A. 1599 on 13th September, 1962, under the following circumstances.

2. The petitioner grows sugar-cane and converts the same into jaggery and sells it through commission agents. On one occasion, the petitioner entrusted 120 bags of jaggery, out of which 115 belonged to him and 5 to a relation of his, for the purpose of sale. The said bags of jaggery were sought to be transported to Kurnool under a way-bill covering only 115 bags as belonging to the petitioner. During transit the lorry was checked and as some of the goods were not covered by the way-bill, the Deputy Commercial Tax Officer, <NAME>, seized the entire stocks of 120 bags. On receipt of information, the petitioner filed his objections and in spite of repeated requests pointing out the urgency for the disposal of the goods, the petitioner did not get any reply from the authority, but came to know that his commission agent at Kodikonda received a notice that the jaggery would be sold on 25th October, 1962. Without even passing an order of confiscation of the goods, the Deputy Commercial Tax Officer gave notice to sell the goods in public auction as they were of a perishable nature. Before the order of confiscation could be passed, the petitioner filed this application challenging the action of the Commercial Tax Officer on two grounds : firstly that Section 29 of the Andhra Pradesh General Sales Tax Act, 1957, in so far as it provides for confiscation of goods, is ultra vires of the <ORG> and secondly, that, in any event, the said power of confiscation is invalid as it violates the fundamental right of the petitioner guaranteed to him under Article 19(1) of the Constitution of India being an unreasonable restriction on the holding of property.

W. P. No. 1044 of 1962.

3. This is an application under Article 226 of the Constitution of India for the issue of an order in the nature of mandamus directing the Assistant Commercial Tax Officer, <NAME>, to return the goods confiscated by him from the petitioner under the following circumstances : The petitioner is a firm of merchants doing business in various commodities including fertilizers. On one occasion, the Assistant Commercial Tax Officer, <NAME>, made a surprise inspection of its godowns and discovered that certain quantities of goods in the petitioner's possession have not been accounted for in its books of account. After taking the necessary statements from the petitioner, the Assistant Commercial Tax Officer confiscated the goods which were not accounted for and passed an order to the said effect on 16th October, 1962. Without filing an appeal against the order of confiscation, the petitioner filed the present writ petition to this Court raising two questions: firstly, that Section 28(6) of the Andhra Pradesh General Sales Tax Act, 1957, is ultra vires of <ORG> and, secondly, that in any event, the said provision of law offends Articles 14 and 19(1) (f) and (g) of the Constitution of India.

4. We would have been extremely reluctant to entertain these writ petitions at the instance of the parties who have failed to pursue the remedies provided under the Act, except for the fact that the cases were posted before <ORG> by a learned Judge of this Court on the ground that they raised questions challenging the vires of the statute and also questions of constitutional validity. As these two writ petitions involve common questions they are being disposed of by a common judgment.

Point No. 1.-The first point raised before us is that Section 28(6) and Section 29(3) of Andhra Pradesh General Sales Tax Act in so far as they provide for confiscation of goods, are ultra vires of <ORG> and that they should therefore be struck down.

5. The relevant provisions of the Act may be summed up as follows : Section 28(1) authorises any officer of <ORG> to require any dealer to produce before him the accounts, registers and other documents and to furnish any other information relating to his business. Sub-section (2) of Section 28 says that all such accounts, registers and other documents maintained by a dealer in the course of his business shall be open to inspection at all reasonable times. Sub-section (3) authorises the concerned officer to seize such accounts, registers or other documents of the dealer if the officer has reason to suspect that, the dealer is attempting to evade the payment of the tax due from him under the Act and various other provisions are made regulating the retention of the books by the officer. Sub-section (4) confers the power to enter and search at all reasonable times, any office, shop, godown, vessel, vehicle or any other place of business or any building or place where such officer has reason to believe that the dealer has been keeping the goods, accounts, etc. Sub-section (5) gives the power to the officer to break open any box in which any accounts or documents are kept or to break open the door of any premises where such documents may be kept. Sub-section (6) of Section 28 which is impugned before us runs as follows :

Any such officer shall have power to seize and confiscate any goods which are found in any office, shop, godown, vehicle, vessel or any other place of business or any building or place of the dealer, but not accounted for by the dealer in his accounts, registers and other documents maintained in the course of his business :

Provided that before taking action for the confiscation, of goods under this sub-section, the officer shall give the person affected an opportunity of being heard and make an inquiry in the prescribed manner.

Explanation.-It shall be open to <ORG> to authorise different classes of officers for the purpose of taking action under Sub-sections (1), (2) and (3).

6. Section 29 lays down the procedure for the establishment of check post or barrier and for inspection of goods while in transit. Sub-section (1) of Section 29 provides for the setting up of a check post or a barrier at a place to be notified with a view to prevent or check the evasion of tax under the Act. Sub-section (2) authorises an officer of <ORG> to inspect all records relating to the goods carried at the check post and requires the person in charge of the transit to give the name and address of the owner of the vehicle or boat if required so to do. Sub-section (3) which prescribes for confiscation reads as follows :

The officer in charge of the check post or barrier, or the officer empowered as aforesaid shall have power to seize and confiscate any goods which are under transport by a goods vehicle or a boat and are not covered by a way-bill issued by the person who consigns the goods in such form and containing such particulars as may be prescribed :

Provided that before taking action for the confiscation of the goods under this sub-section, the officer shall give the person affected an opportunity of being heard and make an inquiry in the manner prescribed.

7. Rule 45 of the Andhra Pradesh General Sales Tax Rules of 1957 prescribes an elaborate procedure as to how dealers liable to pay tax under the Act should maintain accounts, vouchers, registers etc. Rule 46 lays down the machinery for the establishment of check posts or barriers for the inspection, seizure and for confiscation of goods. Rule 46(8) reads as follows :

46. (8) Where a confiscation was ordered for the reason that the owner was not ascertainable, such person or any person on his behalf may appear before the officer ordering the confiscation, and satisfy him with relevant record regarding the bona fides of the transport of the goods in question. If the officer is satisfied that there has been no evasion of tax he may, for reasons to be recorded in writing, order the release of the confiscated goods. The officer shall also specify in his orders the amount due to be paid towards the charges, if any, incurred by the <ORG> for the safe custody of the goods and other incidental charges. If the officer is not so satisfied, he may after recording the reasons therefor, order that the sale under Sub-rule (5) may be proceeded with.

8. Rule 48(1) runs as follows:-

If any officer authorised under Section 28 of the Act, finds any goods in any office, shop, godown, vehicle, vessel or any other place of business or any other building, or place of a dealer which have not been accounted for in his accounts, registers or other documents maintained in the course of his business, he may seize and confiscate such goods after following the procedure prescribed in Rule 46...

9. The order of confiscation is open to appeal under Section 19 of the Act.

10. As already stated, the contention of the learned counsel for the petitioners is that the power to confiscate the goods does not fall within the ambit and scope of the legislative power conferred on the <ORG> under Entry 54 of List II of Schedule VII appended to the Constitution of India. The said Entry 54 reads as follows :

Taxes on the sale or purchase of goods other than newspapers...

11. It is now well-settled by more than one decision of <ORG> that the power to levy a tax includes all incidental powers to prevent the evasion of such tax. <CITATION> A.I.R. 1960 S.C. 424, it was observed that in the interpretation of the scope of items in the Legislative Lists in Schedule VII the widest possible amplitude must be given to the words used and each general word must be held to extend to ancillary or subsidiary matters which can fairly be said to be comprehended in it. <CITATION> A.I.R. 1961 S.C. 736, considering the validity of Section 23A of the Indian Income-tax Act, 1922, their Lordships of <ORG> pointed out:

As is well known the legislative entries have to be read in a very wide manner and so as to include all subsidiary and ancillary matters. So Entry 54 should be read not only as authorising the imposition of a tax but also as authorising an enactment which prevents the tax imposed being evaded. If it were not to be so read, then the admitted power to tax a person on his own income might often be made infructuous by ingenious contrivances. Experience has shown that attempts to evade the tax are often made...

12. Similarly in <CITATION> A.I.R. 1961 S.C. 736, it was stated as follows :

It is well-settled that the entries in the lists are not powers but are only fields of legislation, and that widest import and significance must be given to the language used by <ORG> in the various entries.

13. Again, in the latest case of <CITATION>  15 S.T.C. 403, considering the validity of Section 11(2) of the Hyderabad General Sales Tax Act, 1950, <ORG> observed as follows :

Now there is no dispute that the heads of legislation in the various lists in the Seventh Schedule should be interpreted widely so as to take in all matters which are of a character incidental to the topics mentioned therein. Even so, there is a limit to such incidental or ancillary power flowing from the legislative entries in the various lists in the Seventh Schedule. These incidental and ancillary powers have to be exercised in aid of the main topic of legislation, which in the present case, is a tax on sale or purchase of goods. All powers necessary for the levy and collection of the tax concerned and for seeing that the tax is not evaded are comprised within the ambit of the legislative entry as ancillary or incidental...'

14. Hence, the question that falls for decision is whether confiscation of the goods is a power ancillary or subsidiary to the object of preventing evasion of tax under the Act.

15. A similar question was raised before <ORG> in <CITATION>  16 S.T.C. 894, in which the validity of Section 28-A of the Mysore Sales Tax Act, 1957, relating to confiscation of goods was considered. It was held in the above decision of <ORG>, (i) that the power to legislate on a topic of legislation carries with it the power to legislate on an ancillary matter which can be said to be reasonably included in the power given and that the power to provide for the taking of steps to prevent evasion of tax is reasonably related to the legislative power itself of imposing such tax ; (ii) that persons who are not directly liable to pay the tax may also have their activities reasonably restricted with a view to prevent the principal persons liable to tax from evading payment of tax ; (iii) that Section 28-A of the Mysore Sales Tax Act, 1957, does not purport to levy any tax and, therefore, there is no possibility of either exempted goods or inter-State transactions being exposed to levy of tax not lawfully exigible; and (iv) that the section does not say that the payment demanded by it, though not a tax, shall be paid as if it were a tax and that what it does is to make certain provisions with a view to prevent evasion of tax and to impose penalty for contravention of those provisions. Penalty is intended to make the machinery against evasion effective. Referring to Sub-section (6) of Section 28-A of the Mysore Sales Tax Act which provides for confiscation or payment of certain sum of money in lieu thereof, the learned Judges observed that the said amount or the confiscation is not intended to be collected as a tax but obviously it is in the nature of a punishment for contravention of the section rendering the goods liable for confiscation. Whether one looks upon confiscation itself as the primary punishment or the payment as the primary punishment and confiscation only an effective way of enforcing the said payment, there can be ho doubt that what the section purports to do is to punish a person for failure to obey it and not to impose on him a tax in respect of his turnover... A more appropriate analogy for it is to be found in statutes like the Central Excises and Salt Act , Sea Customs Act, etc., in which the authorities functioning under the said statutes are themselves authorised in certain circumstances to confiscate goods answering a particular description and also levy penalty on a person for contravention of certain provisions of the Act or rules made thereunder, irrespective of or in addition to whatever liability there may be for payment of excise duties or customs duties... the information sought under the impugned section is only for identifying the nature of the transaction and tracing the dealer only with a view to see that a person or a transaction legitimately liable to sales tax under the State Act does not escape payment of such tax.

16. Distinguishing the decision of <ORG> in <CITATION>  15 S.T.C. 403, the learned Judges stated that Section 28-A of the Mysore Act "does not say that the payment demanded by it, though not a tax, shall be paid as if it were a tax. What it does is to make certain provisions with a view to prevent evasion of tax and to impose penalty for contravention of those provisions. Penalty is obviously intended to make the machinery against evasion effective." It was accordingly held on the above reasoning that the impugned provision being intended as a step for preventing evasion, it was within the ambit of ancillary powers of legislation under Entry 54 of List II in the Seventh Schedule of the Constitution. While upholding the legislative vires of the section, <ORG> no doubt struck down the section as the procedure laid down thereunder offends Article 19 of the Constitution. We will refer to this point at the appropriate stage.

17. The same question came up for consideration before <ORG> in <CITATION>  16 S.T.C. 708 in which, while upholding the power of seizure of the goods, the learned Judges held that the power to confiscate the goods under Section 14(4) of the Madras General Sales Tax Act, 1959, does not come within the ambit of Entry 54 of List II of the Seventh Schedule of the Constitution as it is neither ancillary nor incidental thereto and that therefore invalid. While stating that the entries in the legislative lists prescribed only the field of legislation including all incidental and ancillary powers, the learned Judges following the case in <CITATION>  15 S.T.C. 403 held that the power to confiscate the goods is not an ancillary power. It was observed as follows (referring to the above <ORG> decision):

Though there is no analogy to the present context, the principle of this decision is clear that what has been properly a subject within the ambit of a legislative head of power including ancillary and incidental powers flowing therefrom, cannot be indirectly legislated upon under the guise of making a law which might otherwise be within the limits of legislative head of power. We are of the view that the provision for seizure and confiscation of goods offends that principle.

18. It was further observed that the power of confiscation cannot be ancillary or incidental to the power to tax a sale or a purchase even from the standpoint of checking evasion or making evasion unprofitable, that the Act is not a law on goods and that no such law can be made in the guise of Entry 54. With great respect to the learned Judges, we are unable to accept this view for the following reasons:

The principle underlying the decision in <CITATION>  15 S.T.C. 403 is that "the <ORG> cannot under Entry 54 relating to taxation make a provision to the effect that even though a certain amount collected is not a tax on the sale or purchase of goods, it will still be collected as if it were such a tax." <ORG>, in the said ruling, was considering the validity of Section 11 of the Hyderabad General Sales Tax Act  which is to the following effect: Sub-clause (1) of Section 11 lays down that no unregistered dealer shall collect any amount by way of tax under the Act. Sub-clause (2) of that section provided that every person who has collected any amount by way of tax otherwise than in accordance with the provisions of that Act shall pay over to the <ORG> the amount so collected by him and in default the amount shall be recovered as if it were arrears of land revenue. Referring to the language of this section, <ORG> pointed out that it is not open to the <ORG> to collect from the dealers what they have unlawfully collected from their customers. In other words, the State <ORG> has no power to collect money which is not a tax as if it were a tax. Under these circumstances, it was held that in the guise of ancillary legislation, such a power to collect monies cannot be justified. We do not see that the principle of the said case has any analogy to the present case. In this connection, we are inclined to agree with the view of the learned Judges of <ORG> that the power to seize and confiscate the goods is only by way of punishment or penalty which is intended to operate as the most effective deterrent against tax-evaders, and that it is, therefore, ancillary in the sense that it seeks to achieve the object of preventing evasion of tax. It is contended by <NAME>, the learned counsel for the petitioner that though confiscation of goods may be one of the modes of checking evasion of tax, it is not an ancillary power because it may not be necessary to impose such a drastic step and that a mere inspection of the accounts or the goods and documents, etc. is sufficient to gather the material or data to levy tax or penalty from the dealer. It is not for us to say what particular measure would carry with it the required deterrent effect. So long as the steps or the measures taken by the State <ORG> are directed towards the achievement of the object of prevention of evasion of tax, they come within the scope of ancillary powers irrespective of the question whether it may be necessary or not for the <ORG> to impose a drastic provision or only a lenient punishment. The other objection stated by the learned Judges of <ORG> is that the Act is not a law on goods and that the power to confiscate does not really come within the ambit of the power to tax. No doubt, as pointed out by <ORG> in In re Sea Customs Act, A.I.R. 1963 S.C. 1760, sales tax, like the excise duty, is not a direct tax on the goods such as the direct taxes on property or income. It is only in the nature of an indirect tax, as the taxable event in either case is either the manufacture of the goods or the sale of the goods, respectively. Similarly, even in the case of Sea Customs Act, while the duties are levied on the movement of the goods across the customs barrier, the confiscation of the goods or even a vessel which does not conform to the customs rules is justified on the ground of preventing evasion of customs duties, though it is not a direct tax on the goods. Hence, for all the above reasons, we are inclined to accept the Mysore view in preference to the Madras view and hold that the impugned sections of the Andhra Pradesh General Sales Tax Act, in so far as they relate to confiscation of goods under Sections 28 and 29 are within the powers of the State <ORG> and hence valid.

Point 2.--The second point raised by the learned Advocates for the petitioners is that the provision of law relating to the confiscation of goods, clothes the concerned authority with excessive and arbitrary power and that it, therefore, offends Articles 14 and 19 (1)(f) and (g) of the Constitution of India, on the ground that the said powers cannot be regarded as reasonable restrictions on the holding or enjoyment of property or the carrying on of business by the dealer. On this aspect of the case, <ORG> in the case referred to already, i.e., <CITATION>  16 S.T.C. 894, held that section 28-A of the Mysore Sales Tax Act while providing for an enquiry, has totally failed to indicate what the purpose of enquiry is and the so-called enquiry provided in the section must be regarded as a pretence, and that the procedure offends Article 19.

19. With great respect, we are unable to accept this conclusion. <CITATION> A.I.R. 1960 S.C. 424, dealing with the contention that certain Central Excise Rules laying down restrictions on warehousing and penalties providing for confiscation etc. are unreasonable and not saved by Article 19 of the Constitution of India, <ORG> observed as follows:

The basis of this argument was that there is no procedure laid down in the provisions for levying penalties nor any provision made for notice or taking of evidence and power of confiscation was given to persons who could not be termed unbiassed. If the tribunal is to act judicially it must conform to the principles of natural justice of audi alterant partem and there is no dispute that in the instant case there was no breach of this rule. Not only this, there is a right of appeal and a revision is also provided and both these remedies the petitioner availed himself of. The argument of unreasonable restrictions because of this ground must also fail.

20. Again in <CITATION> A.I.R. 1962 S.C. 316, in dealing with an argument that Section 178A of the Sea Customs Act which operates to cast the burden of proof on the person from whose possession gold is seized to establish that the goods are not smuggled, has over-stepped the limits of reasonableness, in imposing restraint on the freedom guaranteed under Article 19(1)(f) and (g ), <ORG> observed to the following effect: The test for ascertaining the reasonableness postulated by clauses (2) to (6) of Article 19 should be applied to each individual statute impugned, and no abstract standard or general pattern of reasonableness can be laid down as applicable to all cases. The nature of the right alleged to have been infringed, the underlying purpose of the restrictions imposed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at the time, should all enter into the judicial verdict. It would be apparent that this is in line with the great principle underlying the structure of the rights guaranteed by Article 19 , viz., a balancing of the need for individual liberty in the matter, inter alia, of the right to hold property or of the right to carry on trade, with the need for social control in order that the freedoms guaranteed to the individual subserve the larger needs-moral, social, economic and polictical-of the community and thus ensure orderly progress towards the goal indicated by the preamble. It would follow that the reasonableness of the restraint would have to be judged by the magnitude of the evil which it is the purpose of the restraint to curb or eliminate.

21. It was also observed with reference to the contention that the procedure indicated in the rules for confiscation and adjudication does not provide for sufficient safeguards to prevent abuse of power on the part of ths concerned officials, as follows :

The possibility of abuse of a statute otherwise valid does not impart to it any element of invalidity...The constitutional validity of the statute would have to be determined on the basis of its provisions and on the ambit of its operation as reasonably construed.

22. Referring to the argument under Article 14 of the Constitution it was again observed in the said ruling as follows :

No doubt, there are situations when the points regarding a violation of Article 14 and an objection that a restriction is not reasonable so as to conform to the requirements of Article 19(5) or (6) may converge and appear merely as presenting the same question viewed from different angles. Such, for instance, are cases when the denial of equality before the law is based on the ground that the power vested, say, in an administrative authority to affect rights guaranteed to a citizen is arbitrary, being ungraded or uncanalised. The vesting of such a power would also amount to the imposition of an unreasonable restriction on the exercise of the guaranteed right to trade or carry on a business etc. Where, however, there is guidance and the legislation is challenged on the ground that the law with the definite guidance for which it provides has outstepped the limits of the Constitution by imposing a restraint which is either uncalled for or unreasonable in the circumstances, the scope and content of the enquiry is far removed from the tests of conformity to rational classification adopted for judging whether the law has contravened the requirement of equal protection under Article 14.

23. Similarly in <CITATION> A.I.R. 1962 S.C. 123, in dealing with the question of reasonableness of restrictions it was stated that the object sought to be achieved by Section 16(3) of the Income-tax Act is to prevent the prevalent abuse, namely, evasion of tax by an individual doing business under a partnership nominally entered with his wife or minor children.

24. In view of the above principles laid down by <ORG>, it is not possible to say that the procedure laid down by the rules under the Andhra Pradesh General Sales Tax Rules of 1957 for seizure and confiscation of goods imposes any unreasonable restrictions or confers any unreasonable or unguided power in the hands of the concerned officer. As already pointed out, the rules lay down an elaborate procedure and contemplate various stages before the order of confiscation is passed. The party is heard and given an opportunity to submit his explanation. If the officer is satisfied with the explanations, he is required to release the goods and if he is not so satisfied he has to pass an order of confiscation and the said order is open to appeal and revision etc. We cannot assume that the officers entrusted with the said duties are bound to be arbitrary and not amenable to reason. It was further argued by the learned Advocate for the petitioners that the moment goods are seized there is no more opportunity for the party to state his case. This argument is based upon a fallacy because the learned counsel has failed to appreciate the distinction between the two stages of seizure and confiscation. The whole process of confiscation consists of three stages; firstly, inspection and checking on the basis of the way-bills or accounts ; secondly, seizure of the goods if the same are not disclosed in the accounts or by the way-bills. At this stage, the party is given an opportunity to show cause why the goods should not be confiscated. It is only when the explanation is found unsatisfactory that the officer has to pass the order of confiscation and until he passes such order of confiscation, he merely retains the goods in his custody. Hence, it cannot be said that confiscation of the goods provided for under the Act is not preceded by any enquiry giving opportunity to the party to show cause against the same. The fact that the officers in charge of the duty of seizure and confiscation are likely to abuse their powers is not a ground as pointed out by <ORG> for invalidating the statute. We have not been shown how the rules under the Mysore Act stand in comparison with the rules under the Andhra Pradesh Act . Regarding the provisions for confiscation of goods as the extreme deterrent punishment intended to achieve the object of evasion of taxes, we are not prepared to hold that confiscation of the goods would be an unreasonable restriction on the holding of property or the carrying on of business by a dealer. As already stated, the reasonableness of a restriction or a provision of law has to be judged with reference to various factors enunciated above. We are, therefore, convinced that the procedure laid down under the rules cannot be said to be violative of Article 14 or 19(1)(f) or (g) of the Indian Constitution.

25. In the view we have taken above, it is not necessary to deal with the alternative argument advanced by Sri <NAME>, on behalf of the <ORG>, that even if the provisions of Sections 28 and 29 of the Act do not fall within the scope and ambit of Entry 54 relating to taxation of sale or purchase of goods, it may be brought in under Entry 26 of List II which relates to ''trade and commerce".

26. In Writ Petition No. 971 of 1962, we are told that no order of confiscation has at all been passed. If the said statement is correct, an order of confiscation has to be passed in which case, the petitioner will have a right of appeal to show cause against the same. Even otherwise, it was argued by Sri <NAME>, the learned counsel for the petitioner that the Commercial Tax Officer is not justified in seizing 115 bags of jaggery which are admittedly covered by the way-bill. The learned Government Pleader has not been able to justify the action of the Commercial Tax Officer in having seized the goods which are covered by the way-bill. Hence, the seizure of 115 bags is not justified in law. The petitioner is stated to have taken delivery of 115 bags after furnishing security. Hence W.P. No. 971 of 1962 is allowed with respect to 115 bags and it is dismissed with regard to the remaining five bags in respect of which the Commercial Tax Officer may hold an enquiry as contemplated by law. The security taken from the petitioner will, therefore, be cancelled. The writ petition is, therefore, allowed in part; but there will be no order as to costs.

Writ Petition 1044 of 1962 is dismissed with costs. Advocate's fee Rs. 100.