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1973 (3) TMI 152
Issues Involved:
1. Reconstitution of the Board of Directors of Bennett Coleman & Co. Ltd.
2. Dismissal of the Judge's Summons for recording a compromise.
3. Legality of the reconstituted Board under Sections 255 and 408 of the Companies Act.
4. Propriety of the reconstituted Board.
5. Injunction against certain individuals from becoming directors or interfering with the company's affairs.
Issue-wise Detailed Analysis:
1. Reconstitution of the Board of Directors of Bennett Coleman & Co. Ltd.:
The High Court reconstituted the Board of Directors of Bennett Coleman & Co. Ltd., directing that the new Board should consist of eleven directors: three shareholder directors, three nominated by the Central Government, and five appointed by the Court. This reconstituted Board was to operate for seven years. The Court also modified certain Articles of Association to effectuate this reconstitution, ensuring that the Articles could not be altered without the Court's permission.
2. Dismissal of the Judge's Summons for recording a compromise:
Respondent No. 2 took out a Judge's Summons to record an alleged compromise between the Union of India and the Company. The learned Judge dismissed this application on several grounds:
- The two letters relied upon did not constitute a concluded and complete agreement.
- The shareholders could not represent the Company in entering into such a settlement.
- The shareholders were not parties to the proceedings.
- The conduct of Respondent No. 2 in submitting to the Court's orders should prevail over the alleged settlement.
- The compromise was not in public interest.
3. Legality of the reconstituted Board under Sections 255 and 408 of the Companies Act:
The appellants argued that the reconstituted Board violated Sections 255 and 408 of the Companies Act. Section 255 mandates that two-thirds of the directors must retire by rotation, which was not adhered to in the reconstituted Board. The Court, however, held that its powers under Sections 397, 398, and 402 were broad enough to override these provisions in cases of mismanagement and oppression. The Court's order was found to be within its jurisdiction and not violative of the Companies Act.
4. Propriety of the reconstituted Board:
The appellants contended that the reconstituted Board curtailed the shareholders' rights to manage the Company. The Court, however, justified the reconstitution, stating that it was necessary to prevent future mismanagement and to protect public interest. The period of seven years was deemed reasonable given the pending criminal and taxation proceedings against certain respondents.
5. Injunction against certain individuals from becoming directors or interfering with the company's affairs:
The Court issued an injunction against Respondent No. 2 and others, barring them from becoming directors or interfering with the Company's affairs. This was based on serious allegations of mismanagement, misfeasance, and embezzlement against them. The Court felt that such a measure was necessary to ensure proper management of the Company in the future.
Conclusion:
The High Court's judgment aimed to address the mismanagement and protect public interest by reconstituting the Board of Directors and issuing necessary injunctions. The Court's powers under Sections 397, 398, and 402 were interpreted broadly to allow for such measures, even if they contravened other provisions of the Companies Act. The appeals challenging the reconstitution and the injunctions were dismissed, upholding the Court's orders as both legal and proper.
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1973 (3) TMI 151
Issues Involved:
1. Validity of Rule 615, General Rules (Civil), 1957.
2. High Court's power to prescribe dress for advocates under the Advocates Act, 1961.
3. Whether Rule 12 of the High Court rules is valid and enforceable.
4. Whether the prescribed dress code infringes on national esteem and Indian culture.
5. Whether the impugned orders are arbitrary or capricious.
Detailed Analysis:
1. Validity of Rule 615, General Rules (Civil), 1957:
The petitioner challenged Rule 615, which prescribes a specific dress code for advocates, arguing that it is no longer valid in light of the Advocates Act, 1961, and the rules framed thereunder. The court held that Rule 615 is still operative and valid. It was framed under Article 227 of the Constitution and Section 122 of the Code of Civil Procedure, which have an overriding effect. There is no inconsistency between Rule 615 and the rules framed under the Advocates Act; rather, they supplement each other and must be read together to provide a complete dress code for advocates.
2. High Court's Power to Prescribe Dress for Advocates Under the Advocates Act, 1961:
The petitioner argued that only the Bar Council of India has the power to prescribe dress for advocates under Section 49(c) of the Advocates Act, 1961. However, the court held that the High Court has the power to regulate the appearance of advocates in courts under Section 34(1) of the Advocates Act. The right to practice and the right to appear in courts are not synonymous. The High Court can make rules for regulating the appearance of advocates and proceedings inside the courts, which includes prescribing a dress code. Therefore, Rule 12 framed by the High Court prescribing dress for advocates is valid and enforceable.
3. Whether Rule 12 of the High Court Rules is Valid and Enforceable:
The petitioner contended that Rule 12 merely prescribes the dress for advocates but does not postulate any penalty for breach of that rule, making it directory and not mandatory. The court rejected this argument, stating that the use of the word "shall" in Rule 12 indicates its mandatory nature. The penalty for non-compliance is implied in Section 34(1) of the Advocates Act, which allows the court to refuse audience to an advocate not wearing the prescribed dress. Therefore, Rule 12 is mandatory, and the court has the authority to enforce it.
4. Whether the Prescribed Dress Code Infringes on National Esteem and Indian Culture:
The petitioner argued that the prescribed dress code, which excludes Dhoti and Kurta, is derogatory to national esteem and Indian culture. The court found no merit in this argument, stating that trousers and paijamas have existed as respectable dress in India from ancient times and do not involve any violence to patriotic sentiment. The prescribed dress code serves a useful purpose by distinguishing advocates from litigants and the public, inducing a seriousness of purpose and a sense of decorum conducive to the dispensation of justice.
5. Whether the Impugned Orders are Arbitrary or Capricious:
The petitioner claimed that the impugned orders preventing him from appearing in court in Dhoti and Kurta were arbitrary and capricious. The court held that the orders were valid and legal, as the petitioner violated the prescribed dress code. The court emphasized that the prescribed dress code is essential for maintaining decorum and dignity in the court, and non-compliance with it justifies the refusal of audience. The court also dismissed the argument of mala fide, stating that the exercise of legal power would not be vitiated merely because it was not exercised against all members of the Bar.
Conclusion:
The writ petition was dismissed in limine, with the court upholding the validity and enforceability of Rule 615 and Rule 12, and affirming the High Court's power to prescribe dress for advocates. The prescribed dress code was found to be reasonable, necessary for maintaining decorum, and not derogatory to national culture. The impugned orders were deemed valid and legal.
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1973 (3) TMI 150
Issues:
Whether excise duty can be levied on rectified spirit under the U.P Excise Act, 1910.
Detailed Analysis:
The appellants manufactured rectified spirit and sent consignments to Punjab, where excess wastage led to the imposition of excise duty. The appellants challenged this duty through a writ petition after their revision was rejected by the State Government. The Single Judge dismissed the petition, leading to this appeal.
Two grounds were raised in the appeal: first, whether rectified spirit is an excisable article under the U.P Excise Act, 1910, and second, the lawfulness of levying excise duty on wastage. The Court decided in favor of the appellants on the first ground, rendering the discussion on the second ground unnecessary.
The Court referred to Sec. 28 of the Act empowering the imposition of excise duty on an excisable article defined in Sec. 3(22a) as "any alcoholic liquor for human consumption" or "any intoxicating drug." While rectified spirit is acknowledged as an intoxicating liquor, the crucial question was whether it is "for human consumption." The Court disagreed with the interpretation that it means "capable of human consumption," asserting it should be "intended or meant for human consumption" at the manufacturing stage.
The Court examined the specifications for rectified spirit in the U.P Excise Manual, noting two grades meant for pharmaceutical, medicinal, and industrial uses, but not directly for human consumption. It highlighted that rectified spirit is not sold in the market for human consumption, as it is only available for specific purposes under strict licensing regulations.
The Court emphasized that while rectified spirit can be converted into potable liquors fit for human consumption, this capability does not categorize rectified spirit itself as an "alcoholic liquor for human consumption." Citing a precedent, the Court concluded that rectified spirit is not an excisable article under the U.P Excise Act, and excise duty imposed on it was unlawful. Consequently, the demand notices for excise duty were quashed, and any recovered duty was ordered to be refunded to the appellants.
In conclusion, the appeal was allowed, the Single Judge's judgment was set aside, and the demand notices were quashed, with costs awarded to the appellants.
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1973 (3) TMI 149
Issues Involved:
1. Challenge to Summons and Order by the Commission
2. Relevancy of Requested Documents
3. Interpretation of "Inter-connected Undertakings" under Section 2(g)
4. Scope of Control: De Jure vs. De Facto
5. Reliance on Datta Commission Report
6. Maintainability of the Writ Petition
Issue-wise Detailed Analysis:
1. Challenge to Summons and Order by the Commission:
The petitioner challenged a summons issued under Section 12 of the Monopolies and Restrictive Trade Practices Act, 1969, and an order dated May 12, 1972, passed by the Monopolies and Restrictive Trade Practices Commission. The summons directed the production of specific documents, including the cashbook, ledger, and journal of the company for 1971, minute books of the Committee of Directors for 1970 and 1971, and reports of Sri B. M. Birla on his foreign trips. The petitioner argued that these documents were irrelevant to the Commission's inquiry.
2. Relevancy of Requested Documents:
The petitioner contended that the documents requested by the Commission were irrelevant. The Commission, however, maintained that the documents were necessary to determine whether the proposed cement factory by Keshoram Industries would be an "inter-connected" undertaking with the petitioner company, Hindusthan Motors Limited. The Court noted that the relevancy was debated more with a reference to the scope of the inquiry than on the documents themselves before the Commission. The Court held that the scope of interference under Article 226 is very limited and should be exercised only in compelling circumstances.
3. Interpretation of "Inter-connected Undertakings" under Section 2(g):
The petitioner argued that inter-connection between undertakings should be determined solely under Section 2(g)(iii) for corporate bodies and not under any other sub-clause. The Commission, however, refused to read the different sub-clauses of Section 2(g) as mutually exclusive. The Commission observed that control over a group of companies could be exercised even without capital-wise, finance-wise, or management-wise control. The Court upheld the Commission's interpretation, stating that the statute intended the concept of inter-connection to be broad and inclusive.
4. Scope of Control: De Jure vs. De Facto:
The petitioner contended that control over corporate bodies must be de jure, i.e., exercised through voting rights, finance, or management. The Commission, however, considered both de jure and de facto control relevant. The Court agreed with the Commission, stating that the object of the statute would be frustrated if only de jure control was considered. The Court emphasized that effective control could be exercised in various ways, including de facto control.
5. Reliance on Datta Commission Report:
The petitioner argued that the Commission erred in relying on the Datta Commission report, which had a different basis for grouping companies compared to the Monopolies Commission report. The Court found this contention to be based on a misapprehension. The Commission was holding the inquiry based on the statute and not solely on the Datta Commission report. The report merely served as a starting point for the inquiry.
6. Maintainability of the Writ Petition:
The respondents argued that the writ petition was not maintainable against an interlocutory order of the Commission. The Court held that while a person could challenge the Commission's decision on the ground of irrelevancy, the scope of such objections and the limit of interference under Article 226 are very restricted. The Court emphasized that the Commission's requirement for documents is for forming its opinion and making a report, and the Court cannot substitute its own decision for that of the Commission.
Conclusion:
The Court dismissed the writ petition, upholding the Commission's summons and order. The Court found no compelling reason to interfere with the Commission's decision, as the documents requested were relevant to the inquiry, and the Commission's interpretation of "inter-connected undertakings" and the scope of control was correct. The Court also noted that the reliance on the Datta Commission report was not improper, and the writ petition was maintainable but not justified in the present case.
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1973 (3) TMI 148
Issues Involved:
1. Competency of the District Magistrate to grant pardon under Section 337(1) of the CrPC.
2. Competency of the revision filed by the first respondent against the District Magistrate's order.
3. Whether the grant of pardon by the District Magistrate is an irregularity cured by Section 529(g) of the CrPC.
Detailed Analysis:
1. Competency of the District Magistrate to Grant Pardon:
The primary issue was whether a District Magistrate is competent under Section 337(1) of the CrPC to grant pardon to an accused when a First Class Magistrate had already rejected such a request. The Court analyzed the relevant provisions of Sections 337 and 338 of the CrPC. Section 337(1) allows various Magistrates, including the District Magistrate, to tender pardon at any stage of the investigation, inquiry, or trial. The proviso restricts this power for First Class Magistrates but not for the District Magistrate. The Court held that the powers conferred by Section 337 on different classes of Magistrates are concurrent and of the same character. Therefore, the District Magistrate retains the power to grant pardon even if the First Class Magistrate has refused. Judicial propriety, however, requires that a lower authority should not grant pardon if a higher authority has refused, except on fresh facts.
2. Competency of the Revision Filed by the First Respondent:
The second issue was whether the revision filed by the first respondent against the District Magistrate's order was competent. The Court referred to Section 435 of the CrPC, which allows the High Court, Sessions Judge, and District Magistrate to call for records of inferior courts to examine the correctness, legality, or propriety of any order. The Court concluded that an order granting pardon is an order recorded or passed and is subject to revision. Therefore, the revision filed by the first respondent was competent.
3. Whether the Grant of Pardon by the District Magistrate is an Irregularity Cured by Section 529(g):
The third issue was whether the grant of pardon by the District Magistrate constitutes an irregularity cured by Section 529(g) of the CrPC. The Court referred to the case of State of Andhra Pradesh v. Cheemalapati Ganeshwara Rao, which held that a pardon granted bona fide is protected by Section 529. However, since the Court found the District Magistrate's order to be legal and valid, it was unnecessary to rely on Section 529(g).
Conclusion:
The Supreme Court set aside the High Court's judgment that the District Magistrate's grant of pardon was illegal. The order dated June 1, 1966, by the District Magistrate, Kanpur, was restored.
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1973 (3) TMI 147
Issues Involved:
1. Validity of the mining lease.
2. Applicability of Article 299 of the Constitution of India.
3. Entitlement to damages for breach of contract.
4. Refund of deposits and incidental expenses.
Detailed Analysis:
1. Validity of the Mining Lease:
The plaintiff, Raghunath Singh, was granted a minor mineral lease for limestone mines by the Director of Mines and Geology, Government of Rajasthan. The plaintiff completed all formalities, including depositing security and dead-rent, and began preparatory work. However, the lease was later canceled by the State without proper execution of the lease agreement by the Director of Mines and Geology on behalf of the Governor. The trial court held that the Director of Mines and Geology was the competent authority to grant the lease and that the lease was valid under the statutory powers of the Minor Mineral Concession Rules, 1955.
2. Applicability of Article 299 of the Constitution of India:
The defendant State argued that there was no enforceable contract as the lease was not executed in accordance with Article 299 of the Constitution. Article 299 requires that contracts made by the State must be expressed in writing, executed in the name and on behalf of the Governor, and by a person authorized by the Governor. The court agreed with the State's argument, stating that the Director of Mines and Geology acted on behalf of the State and the contract must comply with Article 299. Since the lease agreement was not signed by the Director of Mines and Geology on behalf of the Governor, the contract was void and unenforceable.
3. Entitlement to Damages for Breach of Contract:
The trial court awarded damages to the plaintiff for breach of contract, including security deposit, quarterly dead rent, preliminary expenses, incidental expenses, and loss of profit. However, the High Court held that since the lease agreement was not executed in compliance with Article 299, there was no valid contract, and thus, no damages could be awarded for breach of contract. The court emphasized that the provisions of Article 299 are mandatory, and any agreement not complying with its terms is void.
4. Refund of Deposits and Incidental Expenses:
Despite the invalidity of the contract, the court recognized that the plaintiff had deposited money and incurred expenses in good faith. The plaintiff was entitled to a refund of the deposits and incidental expenses under Section 70 of the Contract Act, which provides for compensation when a person lawfully does anything for another person not intending to do so gratuitously. The court awarded the plaintiff Rs. 4715, which included the security deposit, dead-rent, preliminary expenses, and application fee, along with interest at the rate of 6% per annum.
Conclusion:
The appeal was accepted in part. The judgment and decree of the trial court were set aside, and the plaintiff's suit was decreed for Rs. 4715 against the State with proportionate costs in both courts. The amount was to bear pendente lite and future interest at the rate of 6% per annum. The court expressed displeasure at the arbitrary actions of the State Government and the failure of the Director of Mines and Geology to fulfill his duty, which caused significant loss to the plaintiff.
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1973 (3) TMI 146
Issues Involved:
1. Competence of the investigating officer.
2. Cognizability of the offences and the necessity of sanction under Section 196A of the Code of Criminal Procedure.
3. Delay in proceedings and alleged harassment of the accused.
4. Joint trial of the businessman with the Army officers.
Issue-wise Detailed Analysis:
1. Competence of the Investigating Officer:
The High Court quashed the charges on the ground that the officer who investigated the case was not competent. The investigating officer, an Inspector of the Delhi Special Police Establishment, had obtained the order of the First Class Magistrate of Tezpur. The High Court held that as the offences were committed at both Tezpur and Gauhati, authorization from the First Class Magistrate of Gauhati was also required. However, the Supreme Court rejected this argument, stating that the Magistrate who makes the order under Section 5A should have territorial jurisdiction over the place where any part of the ingredients of the offence took place, which was satisfied in this case. The Supreme Court found no substance in the High Court's doubt about the genuineness of the Magistrate's order and emphasized that it was the duty of the learned Single Judge to thoroughly investigate and provide a categorical finding on the matter.
2. Cognizability of the Offences and Necessity of Sanction under Section 196A:
The High Court held that the offences being non-cognizable required sanction under Section 196A(2) of the Code of Criminal Procedure. The Supreme Court disagreed, clarifying that offences under Sections 161, 165, and 165A of the Indian Penal Code and Section 5 of the Prevention of Corruption Act are cognizable offences. The argument that these offences are non-cognizable when investigated by officers below the rank of Deputy Superintendent of Police was rejected. The Supreme Court emphasized that the classification of offences as cognizable or non-cognizable should be consistent, irrespective of the rank of the investigating officer. The Court referred to various High Court decisions supporting this view and concluded that no sanction under Section 196A was necessary.
3. Delay in Proceedings and Alleged Harassment of the Accused:
The High Court quashed the charges due to the undue delay in proceedings, considering it harassment and an abuse of the court process. The Supreme Court noted that the accused themselves contributed significantly to the delay by taking nearly three years to move the High Court for quashing the charges. The Supreme Court found no merit in the argument that the proceedings should be quashed due to delay and emphasized the need for expeditious disposal of the case by the Special Judge.
4. Joint Trial of the Businessman with the Army Officers:
It was argued that the businessman could not be tried along with the two Army officers. The Supreme Court referred to Section 6 of the Criminal Law Amendment Act 1952 and Section 239 of the Code of Criminal Procedure, which allow for the joint trial of persons accused of the same offence committed in the course of the same transaction. The Court cited the case of The State of Andhra Pradesh v. Kandimalla Subbaih & Anr., which supported the joint trial of public servants and private individuals involved in the same conspiracy. The Supreme Court concluded that there was no objection to the businessman being tried along with the Army officers.
Conclusion:
The Supreme Court allowed the appeals, setting aside the order of the learned Single Judge. The Special Judge was directed to proceed with the cases and dispose of them expeditiously, considering the long pendency of the matter. The appeals were thus allowed, and the proceedings before the Special Judge were to continue.
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1973 (3) TMI 145
Issues:
1. Validity of the orders dated April 2, 1964, and February 1, 1965, issued by the Deputy Custodian General.
2. Interpretation of Section 28 and Section 27 of the Administration of Evacuee Property Act, 1950.
3. Application of Section 7-A of the Act in relation to the proceedings.
4. Time limitation for issuing notice under Section 27 of the Act.
5. Definition and authority of the Custodian General under the Act.
6. Jurisdiction of the authorities to review orders based on fraud allegations.
Analysis:
The case involved an appeal against the Delhi High Court's decision dismissing a writ petition filed by the appellants. The appellants, Fatima Bi and Mohd. Sayeed, sought to challenge two orders issued by the Deputy Custodian General in 1964 and 1965. The dispute arose from the declaration of Fatima Bi's property as evacuee property in 1953, which was later reversed in 1956 by the Assistant Custodian, stating she was a non-evacuee owner. Subsequently, in 1964, a notice was issued to reconsider the 1956 order due to alleged fraud and illegality. The High Court addressed three contentions raised by the appellants regarding the finality of the 1956 order, the applicability of Section 7-A, and the time limitation for issuing the notice under Section 27.
The High Court ruled that the 1956 order was not final and could be reopened under Section 27 of the Act, as Section 28 did not bar the revision powers. Additionally, the court held that Section 7-A did not prevent the notice issuance as the proceedings were pending before May 7, 1954. Moreover, the court found no time limitation for issuing the notice under Section 27. The appellants' argument that the 1964 order was invalid as it was not passed by the Custodian General was dismissed, clarifying the authority of Custodians under the Act. The judgment emphasized that the authorities had the power to review orders based on fraud allegations, as fraud is a question of fact that can be challenged by the affected party.
The court rejected the appellants' contentions, stating that the petition was misconceived, and the authorities had jurisdiction to question the legality of the orders. The judgment highlighted that certiorari was not applicable in this case as the authorities had the jurisdiction to issue the notice. Despite the delay in questioning the 1956 order, the authorities were directed to expedite the proceedings. Ultimately, the appeal was dismissed, with each party bearing their own costs, concluding the legal battle over the property status and the validity of the orders under the Evacuee Property Act.
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1973 (3) TMI 144
Issues Involved:
1. Liability of the appellants to discharge the respondents' debt to the Faridabad Development Board.
2. The appellants' failure to make the full payment within the stipulated period.
3. The consequences of the appellants' default under clause 7 of the award.
4. The appellants' contention regarding non-cooperation from the respondents.
5. The recognition of the appellants as debtors by the Faridabad Development Board.
6. The nature of the award and its executability.
7. The appellants' claim of the award being a penalty.
Issue-wise Detailed Analysis:
1. Liability of the appellants to discharge the respondents' debt to the Faridabad Development Board:
Under clause 2 of the award, the appellants were liable to discharge the respondents' debt to the Faridabad Development Board amounting to Rs. 23,686-6-0. Clause 7 stipulated that this amount had to be paid within 1 1/2 years or the appellants had to obtain a complete discharge for the respondents from the Board within that period.
2. The appellants' failure to make the full payment within the stipulated period:
The appellants paid only Rs. 8,000 to the Board and forwarded verified claims worth Rs. 10,000, which the Board did not accept. Thus, they failed to discharge the full liability within the specified period.
3. The consequences of the appellants' default under clause 7 of the award:
Clause 7 of the award provided that if the appellants defaulted in making the payment, the respondents would be entitled to take back possession of the property. The court held that the appellants' default entitled the respondents to regain possession of the property.
4. The appellants' contention regarding non-cooperation from the respondents:
The appellants argued that they were ready and willing to pay the amount but were unable to do so due to the respondents' non-cooperation. However, the court found no support for this contention in the correspondence and held that the appellants created impediments by asking the Board to accept verified claims, which the Board was not legally obligated to accept without proper scrutiny.
5. The recognition of the appellants as debtors by the Faridabad Development Board:
The appellants argued that by accepting part payment, the Board had agreed to substitute the appellants as its debtors in place of the respondents. However, the court found no evidence of such recognition. The correspondence and the Board's actions indicated that the Board did not formally recognize the appellants as its debtors and continued to hold the respondents primarily liable.
6. The nature of the award and its executability:
The appellants contended that the award was merely declaratory and thus inexecutable. The court rejected this contention, stating that the award was intended to be executable and that the respondents were entitled to apply for and obtain possession of the property if the appellants defaulted.
7. The appellants' claim of the award being a penalty:
The appellants argued that the term in clause 7 of the award, which allowed the respondents to take back possession on the appellants' default, was in the nature of a penalty. The court found this argument untenable, stating that the term was not a penalty but a consequence of the appellants' failure to discharge their obligations. The award, having become a decree of the court, could not be treated as a penalty clause.
Conclusion:
The Supreme Court confirmed the judgment of the High Court, holding that the appellants' default entitled the respondents to take back possession of the property. The appeal was dismissed with costs.
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1973 (3) TMI 143
Issues Involved:
1. Whether the two bonds in suit were duly executed for consideration and by a person competent to do so.
2. Whether the said bonds were obtained by practising fraud and misrepresentation on the defendant No. 1 and were void and unenforceable.
3. Whether the alleged assignment of the said bonds in favour of the plaintiff was bona fide and for consideration and whether the plaintiff is entitled to maintain the suit.
Issue-wise Detailed Analysis:
1. Whether the two bonds in suit were duly executed for consideration and by a person competent to do so:
The bonds in question were executed on behalf of defendant No. 1 by Sri N.L. Bidani, who was admitted to be the General Manager of the company. The court found that the principal object of the defendant No. 1 company was to purchase the Sindwani farm, and the bonds were executed in fulfillment of that objective. The acts of N.L. Bidani were ratified by defendant No. 1 through resolutions passed in meetings, including a resolution dated 29th August 1952, which authorized a payment of Rs. 10,000/- to defendants Nos. 2 and 3. The court concluded that the bonds were executed by a competent person and for consideration, noting that the defendant No. 1 would not have ratified the execution of the bonds if they were obtained by fraud or misrepresentation.
2. Whether the said bonds were obtained by practising fraud and misrepresentation on the defendant No. 1 and were void and unenforceable:
The court found no convincing evidence to establish that the bonds were obtained by fraud or misrepresentation. It was argued that the defendants Nos. 2 and 3 did not disclose defects in their title or the non-existence of the standing crop purportedly sold. However, the court noted that no objections were raised at the time of taking possession of the land, and there was no cogent evidence of fraud or misrepresentation. Consequently, the court upheld the finding that the bonds were for consideration and executed by a competent person without fraud or misrepresentation.
3. Whether the alleged assignment of the said bonds in favour of the plaintiff was bona fide and for consideration and whether the plaintiff is entitled to maintain the suit:
The plaintiff alleged that the bonds were assigned to him by defendants Nos. 2 and 3 through deeds of assignment. The court examined the evidence, including the execution of the assignment deeds and the cheques issued as consideration, and found no plausible reason for collusion or fraud. The court noted that the assignment of an actionable claim under Section 130 of the Transfer of Property Act can be with or without consideration and becomes complete upon execution. The assignors did not challenge the assignment, and the plaintiff provided notice of the assignment to defendant No. 1. The court affirmed that the plaintiff was a bona fide assignee of the bonds for consideration and entitled to maintain the suit, even if the assignments were without consideration.
Conclusion:
The court dismissed the appeal, upholding the trial court's judgment that the bonds were duly executed for consideration by a competent person, were not obtained by fraud or misrepresentation, and that the plaintiff was a bona fide assignee entitled to maintain the suit and recover the debts due under the bonds. The appeal was dismissed with costs.
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1973 (3) TMI 142
Issues Involved:
1. Survival of cause of action after the death of the plaintiff.
2. Validity of notices to quit.
3. Right to sue by legal representatives.
4. Interpretation of personal requirement under the Rent Act.
5. Applicability of common law maxim "Actio personalis moritur cum persona."
6. Relevance of Section 306 of the Indian Succession Act.
7. Amendment of pleadings under Order 6, Rule 17 of the CPC.
8. Distinction between different categories of cases involving death of the plaintiff or defendant.
Detailed Analysis:
1. Survival of Cause of Action After the Death of the Plaintiff:
The primary issue was whether the cause of action for possession of premises on the ground of personal requirement survives to the legal representatives of the deceased plaintiff. The judgment emphasized that the survival of the right to sue depends on the nature of the claim and the facts constituting the plaintiff's cause of action. The court held that the personal requirement of the plaintiff does not survive to his legal representatives, as it fundamentally changes the nature of the original cause of action.
2. Validity of Notices to Quit:
The Additional Rent Controller initially dismissed the application on the preliminary ground that the notices to quit were not valid. This decision was later set aside by the Rent Control Tribunal, which remanded the case for a decision on merits. However, the validity of these notices was not the central issue in the Supreme Court's judgment.
3. Right to Sue by Legal Representatives:
The legal representatives of the deceased plaintiff sought to continue the proceedings. The court analyzed whether the right to sue survived to the heirs and concluded that the personal requirement of the plaintiff does not extend to his legal representatives. The court noted that allowing the legal representatives to continue the proceedings would require a fundamental alteration of the pleadings, which is beyond the permissible scope of amendment under Order 6, Rule 17 of the CPC.
4. Interpretation of Personal Requirement Under the Rent Act:
The court examined the nature of the personal requirement asserted by the plaintiff in the ejectment application. It was held that the requirement for the premises was personal to the plaintiff for his occupation and for the members of his family dependent on him. The court emphasized that such a personal cause of action perishes with the plaintiff.
5. Applicability of Common Law Maxim "Actio personalis moritur cum persona":
The court discussed the common law maxim "Actio personalis moritur cum persona," which means a personal action dies with the parties to the cause of action. The court clarified that this maxim is often misunderstood and does not apply to all cases under the Rent Acts. However, in this case, the personal requirement of the plaintiff was deemed to perish with his death.
6. Relevance of Section 306 of the Indian Succession Act:
The court found that Section 306 of the Indian Succession Act, which allows demands and rights to prosecute or defend actions to survive to the executors or administrators, was not relevant in this case. The court noted that the relief sought by the plaintiff could not be enjoyed by his legal representatives after his death.
7. Amendment of Pleadings Under Order 6, Rule 17 of the CPC:
The court held that permitting the legal representatives to continue the proceedings would require a fundamental alteration of the pleadings, which is beyond the scope of permissible amendments under Order 6, Rule 17 of the CPC. The court emphasized that the issues to be determined would fundamentally change if the legal representatives were allowed to continue the proceedings.
8. Distinction Between Different Categories of Cases Involving Death of the Plaintiff or Defendant:
The court distinguished the present case from other categories of cases involving the death of the plaintiff or defendant. It noted that cases where the plaintiff died after obtaining a decree for possession, or where the death occurred during execution proceedings, are based on different principles. The court also distinguished cases where the tenant died during the pendency of proceedings, stating that the landlord's right to evict does not end with the tenant's death.
Conclusion:
The Supreme Court concluded that the right to sue for possession on the ground of personal requirement does not survive to the legal representatives of the deceased plaintiff. The appeal was dismissed, and no order for costs was made.
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1973 (3) TMI 141
Issues Involved:
1. Jurisdiction of the Civil Judge.
2. Misapplication of precedents.
3. Overlooking facts regarding tenants.
4. Use of admissions against petitioners.
5. Interpretation of Section 55(6)(b) of the Transfer of Property Act.
6. Legality and registration of statutory charge.
7. Investigation under Order XXI, Rule 58 of the Code of Civil Procedure.
Detailed Analysis:
1. Jurisdiction of the Civil Judge:
The petitioners challenged the order of the Civil Judge, Senior Division, Bhir, on the grounds that the judge acted without jurisdiction and failed to exercise jurisdiction vested in him under Order XXI, Rules 58 and 59 of the Code of Civil Procedure. The High Court found that the Civil Judge did not properly investigate the possession of the property as required under the rules, thus failing to exercise jurisdiction vested in him.
2. Misapplication of Precedents:
The petitioners argued that the Civil Judge misunderstood and misapplied the judgment in Dnyanu Baby v. Gulab Eknath, (1960) 62 Bom LR 940. The High Court agreed, noting that the Civil Judge erroneously distinguished the case on irrelevant grounds, failing to apply the principles correctly.
3. Overlooking Facts Regarding Tenants:
The High Court observed that the Civil Judge overlooked the fact that tenants were in possession of the land, which was critical to the case. The presence of tenants and their statutory rights under tenancy enactments were significant factors that should have influenced the judge's decision.
4. Use of Admissions Against Petitioners:
The petitioners contended that the Civil Judge improperly used admissions made between Baliram and Jaiwant and Gopalrao against them. The High Court found that such admissions should not have been used to the detriment of the petitioners without proper investigation.
5. Interpretation of Section 55(6)(b) of the Transfer of Property Act:
The Civil Judge's interpretation of Section 55(6)(b) was found to be erroneous. The High Court noted that the statutory charge under this section would only apply if the delivery of the property was not improperly declined. The Civil Judge failed to establish the conditions required for the application of this section.
6. Legality and Registration of Statutory Charge:
The High Court found that the Civil Judge erred in concluding that a statutory charge was created by the consent decree. It was emphasized that if a charge had been created by the decree, it would require registration under Section 17 of the Registration Act. The High Court clarified that a statutory charge under Section 55(6)(b) of the Transfer of Property Act is not automatic and requires specific conditions to be met.
7. Investigation Under Order XXI, Rule 58 of the Code of Civil Procedure:
The High Court noted that the Civil Judge failed to conduct a proper investigation as required under Order XXI, Rule 58. The judge should have determined who was in possession of the property and whether the possession was on behalf of the judgment-debtor or the petitioners. The investigation should have focused on possession rather than the superiority of claims.
Conclusion:
The High Court concluded that the Civil Judge failed to exercise jurisdiction properly and acted with material irregularity. The order dated 24th December 1970 was set aside, and the matter was remanded back to the trial court for re-investigation in accordance with the law. The revision petition was allowed, and the opponents were ordered to pay the costs of the petitioners.
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1973 (3) TMI 140
Issues Involved:
1. Validity of the lease agreement and its classification under the U.P. Urban Area Zamindari Abolition and Land Reforms Act, 1956.
2. The applicability of Article 31A of the Constitution to Section 2(1)(d) of the Act.
3. Determination of whether the land in dispute is an "agricultural area."
4. Validity of the Government notification under Section 8 of the Act.
5. Abatement of suits and appeals under the Act.
Detailed Analysis:
1. Validity of the Lease Agreement and its Classification under the Act:
The lease deed executed on June 23, 1926, granted Plot No. 4635A to Bateshwar Dayal for purposes including planting a grove, erecting buildings, and digging wells. The lease was for 30 years with a renewal option for another 30 years. Upon expiration of the initial term, the trust sought possession of the land, leading to a series of legal disputes.
The primary contention was whether the lease fell under Section 2(1)(d) of the U.P. Urban Area Zamindari Abolition and Land Reforms Act, 1956, which pertains to land leased for erecting buildings. The court observed that the lease was not exclusively for building purposes, as it also allowed for planting a grove. Since no buildings were constructed and a grove was planted, the land could be classified under Section 2(1)(c)(viii) as a grove, thus not falling exclusively under Section 2(1)(d).
2. Applicability of Article 31A of the Constitution:
The appellants argued that Section 2(1)(d) was violative of Articles 14, 19, and 31 of the Constitution and thus invalid. However, the court noted that the Act as a whole is protected by Article 31A, which safeguards laws related to agrarian reform. The court concluded that Section 2(1)(d), despite its broad language, is connected with agricultural reforms and thus receives protection under Article 31A, making it immune from constitutional challenges.
3. Determination of Whether the Land in Dispute is an "Agricultural Area":
The court emphasized that only lands used for growing crops, as a grove, or as pasture land on the relevant date could be acquired under the Act. The appellants alleged that the land was part of a residential kothi and not used for agricultural purposes. The State Government's counter-affidavit failed to address this specific plot, leaving the appellants' claim unchallenged.
The court referred to a Commissioner's report from the trial court, which indicated that the land had scattered trees and was not primarily used as a grove. This report suggested that the land did not meet the definition of "grove-land" under the U.P. Tenancy Act, 1939.
4. Validity of the Government Notification under Section 8 of the Act:
The notification issued on June 16, 1964, declared the land as vested in the State. However, the court found that the State Government had not adequately demonstrated that the land was an "agricultural area" as defined by the Act. Consequently, the court quashed the notification and directed the Government to reassess the land's status in accordance with Sections 3, 4, 5, and 8 of the Act.
5. Abatement of Suits and Appeals under the Act:
The High Court had abated the suits and appeals based on the Act's provisions. The Supreme Court set aside these orders, restoring the suits and appeals to their original numbers. The court directed that the appeals be decided on merits after the appropriate authority determines whether the land is an "agricultural area." If the land is found to be agricultural, the State may issue a new notification under Section 8, and the appeals will be disposed of per the Act's provisions.
Conclusion:
The Supreme Court allowed the writ petition, quashed the Government notification under Section 8, and directed a fresh determination of the land's status. The High Court's orders abating the suits and appeals were set aside, and the cases were restored for decision on merits based on the appropriate authority's findings. Each party was directed to bear its own costs.
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1973 (3) TMI 139
Issues Involved:
1. Whether the order dated March 31, 1969, passed by the Court of Small Causes, Madras, directing the eviction of the respondent tenant is a nullity and as such not executable.
2. Whether the court satisfied itself regarding the bona fide requirement of the landlord for his own occupation.
3. Whether the compromise decree is valid under the Madras Buildings (Lease & Rent Control) Act, 1960.
4. Whether the tenant's objections to the landlord's title and the validity of the notice under Section 106 of the Transfer of Property Act were considered.
Issue-wise Detailed Analysis:
1. Whether the order dated March 31, 1969, passed by the Court of Small Causes, Madras, directing the eviction of the respondent tenant is a nullity and as such not executable:
The respondent contended that the decree for eviction was a nullity because it was based solely on a compromise without the Rent Control Court satisfying itself independently about the bona fide requirement of the landlord. The High Court agreed, holding that the eviction order is void as the Rent Controller did not apply his mind to the statutory requirement. However, the Supreme Court reversed this, stating that the court was satisfied about the landlord's bona fide requirement based on the evidence and the tenant's unconditional withdrawal of his defense.
2. Whether the court satisfied itself regarding the bona fide requirement of the landlord for his own occupation:
The Supreme Court emphasized that the landlord had provided substantial evidence, including 45 exhibits, to support his claim of bona fide requirement. The tenant, despite initially contesting the claim, withdrew his defense unconditionally and submitted to a decree for eviction. The court inferred that the tenant accepted the landlord's claim as true. The Supreme Court held that the Rent Controller's satisfaction could be inferred from the materials on record and the procedural stage reached, indicating that the court applied its mind to the statutory requirement.
3. Whether the compromise decree is valid under the Madras Buildings (Lease & Rent Control) Act, 1960:
The Supreme Court clarified that an order of eviction based on a compromise is not necessarily void if the jurisdictional fact, i.e., the existence of statutory conditions, is established. The court stated that the satisfaction of the Rent Controller need not always be explicitly stated in the order but can be inferred from the proceedings and the evidence presented. The court concluded that the decree for eviction was valid as the landlord's bona fide requirement was established and accepted by the tenant through the compromise.
4. Whether the tenant's objections to the landlord's title and the validity of the notice under Section 106 of the Transfer of Property Act were considered:
The tenant had initially raised objections regarding the landlord's title and the validity of the notice. However, by unconditionally withdrawing his defense, these objections were effectively waived. The Supreme Court noted that these issues no longer survived for consideration due to the tenant's withdrawal of all defenses.
Conclusion:
The Supreme Court allowed the appeal, setting aside the High Court's order and restoring the City Civil Court's order. The court held that the decree for eviction was neither void nor inexecutable, as the Rent Controller was satisfied about the landlord's bona fide requirement based on the evidence and the tenant's withdrawal of defense. The court also dismissed the tenant's objections regarding the landlord's title and the validity of the notice.
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1973 (3) TMI 138
The appellant's trademark was removed from the register due to non-payment of fees for renewal. The Registrar may restore the mark to the register if it is just to do so. The Registrar dismissed the appellant's restoration petition without proper consideration. Restoration should not be denied if it is just, without penal considerations. Restoration may be denied if a third party would be prejudiced, but in this case, restoration is allowed. The appeal is allowed with no costs.
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1973 (3) TMI 137
Issues:
1. Validity of title acquisition by the original plaintiff through a registered sale deed.
2. Determination of passing of title to the plaintiff before the execution of a subsequent sale deed by the defendant.
3. Interpretation of the terms of the sale deed regarding the passing of title upon full payment of consideration.
4. Validity of tender of balance consideration money by the plaintiff and refusal by the defendant.
5. Applicability of depositing balance consideration money in court for a valid tender.
6. Classification of a deed as a mortgage by conditional sale or a sale with a condition of repurchase.
7. Consideration of evidence and findings by the lower appellate court.
8. Requirement of depositing mortgage money in court for redemption of a deed.
Detailed Analysis:
1. The Second Appeal involved a dispute over the acquisition of valid title by the original plaintiff through a registered sale deed. The suit sought a declaration of title to Schedule 1 property and custody of the registration receipt upon payment of specific amounts to the defendants. Both lower courts decreed in favor of the plaintiffs, leading to the appeal by the defendants.
2. The key issue was whether title had passed to the plaintiff before the execution of a subsequent sale deed by the defendant to a third party. The sequence of events, including the execution of deeds and payments made, was crucial in determining the passing of title.
3. The interpretation of the terms of the sale deed regarding the passing of title upon full payment of consideration was central to the dispute. The contention revolved around whether title passed at the time of execution and registration of the deed or upon full payment of the consideration.
4. The validity of the tender of the balance consideration money by the plaintiff and the subsequent refusal by the defendant was a significant point of contention. The courts below accepted the plaintiff's version of events, leading to a finding that the plaintiff had fulfilled her obligations for the exchange of equivalents.
5. The argument regarding the necessity of depositing the balance consideration money in court for a valid tender was raised. The appellant contended that without such a deposit, the tender would not be legally sufficient. However, legal precedents and the Transfer of Property Act were cited to support the validity of the tender without a court deposit.
6. The classification of the deed as a mortgage by conditional sale or a sale with a condition of repurchase was another crucial aspect. The courts below had determined the nature of the deed based on the evidence presented and had concluded that it was redeemable.
7. The consideration of evidence and findings by the lower appellate court was also a subject of discussion. While the appellate court did not extensively discuss the evidence, its affirmance of the trial court's findings was deemed legally sound.
8. Finally, the requirement of depositing the mortgage money in court for the redemption of a deed was clarified. The legal options available to a mortgagor for redemption, including private tender to the mortgagee or instituting a suit, were highlighted to support the court's decision.
In conclusion, the High Court dismissed the appeal, upholding the lower courts' findings on the passing of title and the validity of the plaintiff's actions in the property dispute.
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1973 (3) TMI 136
Issues:
1. Whether the respondents are liable to pay damages in the circumstances of the case.
2. Determination of the quantum of liability of the respondents.
Analysis:
Issue 1: Liability of Respondents
The appellants filed a suit for recovery of damages against the respondents based on tortious liability. The appellants contended that the respondents' actions prevented the sale of wheat flour, causing them financial loss. The respondents argued that their actions were in the interest of public safety and health. The High Court held that the respondents were not liable for damages. The Supreme Court analyzed the orders issued by the respondents under Section 244 of the Municipalities Act. The Court found that the respondents' orders were invalid and mala fide as they were not empowered to act as per the law. The Court emphasized that the respondents' good intentions did not justify their illegal actions, holding them liable for the loss suffered by the appellants.
Issue 2: Quantum of Liability
The High Court did not provide a finding on the quantum of liability of the respondents. With the Supreme Court's decision that the respondents are liable for damages, the case was remanded to the High Court for a determination on the issue of damages. The Supreme Court set aside the High Court's judgment and decree, allowing the appeal and directing the High Court to decide on the damages issue. The costs were to be decided based on the High Court's ruling on damages, indicating a comprehensive review of the case by the High Court.
In conclusion, the Supreme Court found the respondents liable for the damages suffered by the appellants due to their illegal actions under Section 244 of the Municipalities Act. The case was remanded to the High Court for a determination on the quantum of damages, emphasizing the importance of legal procedures and adherence to statutory provisions even in cases of good intentions.
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1973 (3) TMI 135
Issues Involved:
1. Equation of posts between Sales Tax Officers of Madhya Pradesh and Bombay.
2. Consideration of relevant and irrelevant factors by the Central Government.
3. Adherence to principles of natural justice.
4. Validity of the orders passed by the Central Government and the State Government.
Detailed Analysis:
1. Equation of Posts:
The primary issue in these appeals was the equation of posts between the Sales Tax Officers of the old Madhya Pradesh and the Sales Tax Officers, Grade II, of the old Bombay State. The Central Government, after considering representations and consulting the Central Advisory Committee, decided to equate the Madhya Pradesh Sales Tax Officers with Grade II officers of Bombay. This decision was conveyed to the State Government, which amended its previous resolution to reflect this equation and published a seniority list accordingly.
2. Consideration of Relevant and Irrelevant Factors:
The High Court quashed the Central Government's decisions on the grounds that the equation was not rational and that irrelevant and extraneous matters were considered. The High Court observed that the factors such as the nature and duties of the post, responsibilities, minimum qualifications, and salary should have been considered. However, it concluded that even Sales Tax Officers, Grade III, of Bombay were superior to the Madhya Pradesh officers. The Supreme Court, however, found that the Central Government had duly considered the relevant factors and that the decision was based on a proper assessment of these factors.
3. Adherence to Principles of Natural Justice:
The High Court's judgment indicated that the Central Government did not give an opportunity to the Bombay officers to make representations before the initial order of April 23, 1960. The Supreme Court acknowledged this but noted that the defect was rectified by the fresh order of February 15, 1969, which was passed after considering representations from all affected officers. The Supreme Court emphasized that the Central Government had acted in accordance with the provisions of the States Reorganisation Act, 1956, and had given a proper consideration to the representations made by the officers.
4. Validity of Orders:
The Supreme Court held that the Central Government's orders dated April 23, 1960, and February 15, 1969, were passed after due consideration of all relevant factors and representations. The Court found no evidence of irrelevant or extraneous matters influencing the decision. It concluded that the High Court had erred in quashing these orders. The Supreme Court also dismissed the argument that the appeals had become infructuous due to the State Government's compliance with the High Court's directions, noting that the State Government's actions were taken during the pendency of the appeal.
Conclusion:
The Supreme Court set aside the judgment and order of the High Court, thereby allowing the appeals. The Court affirmed the Central Government's decision to equate the Sales Tax Officers of Madhya Pradesh with the Sales Tax Officers, Grade II, of Bombay, and found that the Central Government had acted in accordance with the relevant statutory provisions and principles of natural justice.
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1973 (3) TMI 134
Interpretation of section 11A of the Industrial Disputes Act - whether section 11A applies to industrial disputes which have already been referred to for adjudication and were, pending as on 15-12-1971?
Held that:- Both in respect of cases where a domestic enquiry has been held as also in cases where the Tribunal considers the matter on the evidence adduced before it for the first time, the satisfaction under section 11 A, about the guilt or otherwise of the workman concerned, is that of the Tribunal. It has to consider the evidence and come to a conclusion one way or other. Even in cases where an enquiry has been held by an employer and a finding of misconduct arrived at, the Tribunal can now differ from that finding in a proper case and hold that no misconduct is proved.
In order to make the section applicable even to disputes, which had been referred prior to the coming into force of the section, there should be such a clear, express and manifest indication in the section. There is no such express indication. An inference that the section applies to proceedings, which are already pending, can also be gathered by necessary, intendment. In the case on hand, no such inference can be drawn as the indications are to the contrary. We have already referred to the, proviso to section 11A which states ’in any proceeding under this section’. A proceeding under the section can only be after the section has come into force.
Further the section itself was brought into force some time after the Amendment Act was passed. These circumstances as well as the scheme of the section and particularly the wording of the Proviso indicate that section 11A does not apply to disputes which had been referred prior to 15-12- 1971. The section applies only to disputes which are referred for adjudication on or after 15-121971. To conclude, in our opinion, section 11A has-no application to disputes referred prior to 15-12-1971. Such disputes have to be dealt with according to the decisions of this Court already referred to.
In Civil Appeal No. 1461 of 1972, the Industrial Tribunal had considered only the question regarding- the applicability of the section to disputes which had been referred before the section came into force. The Tribunal has held that the section does not apply to such disputes. This view is in accordance with our decision and as such is correct. This appeal is hence dismissed.
In the three other orders, which are the subject of consideration in Civil Appeals Nos. 1995 of 1972, 1996 of 1972 and 2386 of 1972, the Labour Court, Bombay has held that section 11A applies even to disputes which had been referred prior to 15-121971 This view, according to our judgment, is erroneous. The Labour Court has also-expressed some views on the construction to be placed on section 11 A. Part of the views expressed therein is correct; but the rest are wrong. To the extent that the decision of the Labour Court in the three orders are contrary to our decision on both the points, they are set aside add the appeals allowed to that extent. The Tribunal and the Labour Courts concerned in all these appeals, will proceed with the adjudication of the disputes in accordance with the views expressed in this judgment.
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1973 (3) TMI 133
The High Court of Allahabad ruled that rice bran is not exempt from tax under a specific notification as it is not considered as "bhusi of rice." The court disagreed with the revising authority's interpretation and sided with the department, denying the exemption claim. The reference was answered in the negative. (Case Citation: 1973 (3) TMI 133 - Allahabad High Court)
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