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1977 (9) TMI 128
Issues Involved:
1. Violation of Section 12(1) of the Foreign Exchange Regulation Act, 1947.
2. Application of Sections 113 and 114 of the Customs Act, 1962.
3. Validity of the Collector of Customs' findings and conclusions.
Issue-wise Detailed Analysis:
1. Violation of Section 12(1) of the Foreign Exchange Regulation Act, 1947:
The central issue in these writ appeals was whether the writ petitioners violated Section 12(1) of the Foreign Exchange Regulation Act, 1947. Section 12(1) mandates that exporters must furnish a declaration of the full export value of the goods, or if not ascertainable, the expected value, and affirm that the full export value will be paid within the prescribed period in the prescribed manner. The court noted that the violation of Section 12(1) could be penalized under the Customs Act, as per Section 23-A of the Foreign Exchange Regulation Act.
2. Application of Sections 113 and 114 of the Customs Act, 1962:
The writ petitioners were issued show cause notices under Sections 113(d) and (i) read with Section 50 of the Customs Act, 1962, for the confiscation of goods and imposition of penalties. The Collector of Customs relied on materials obtained from a search of the premises of the agents (Simson and McConechy Ltd.) and concluded that the real contract was with Bevington and Sons, Ltd., London, not the German firm Zentral Kommerz. Consequently, he inferred that the payment was to be made in Sterling rather than Indian Rupees, thus violating Section 12(1) of the Foreign Exchange Regulation Act.
3. Validity of the Collector of Customs' Findings and Conclusions:
The court scrutinized the Collector of Customs' findings and found that there was no material evidence of any secret agreement between Bevington and Sons, Ltd., and Zentral Kommerz. The court emphasized that the violation of Section 12(1) must be based on tangible proof, not mere speculation. The court noted that the materials available, such as correspondence and pencil notings, were insufficient to prove any underhand dealings. The court reiterated that the degree of proof required for penal provisions is akin to that in criminal cases, necessitating concrete evidence.
The court referred to the judgments of Palaniswami, J., and the Supreme Court in Becker Gray and Co. v. Union of India and S. I. Goir Mills v. Addl. Collector of Customs, which highlighted that the declaration must be true in all material particulars and that the mode of payment must comply with the prescribed manner. The court agreed with Palaniswami, J.'s conclusion that there was no material before the Collector to justify the confiscation and penalties imposed on the exporters.
Conclusion:
The court dismissed the appeals, affirming that there was no violation of Section 12(1) by the exporters. The court also extended this conclusion to the agents, as there was no evidence indicating that the contracts were not with the German firm as stated. The court directed the appellants to pay the costs of the respondents in all these appeals.
Separate Judgments:
The court delivered a single judgment for all the appeals, applying the same reasoning and conclusions uniformly across the cases.
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1977 (9) TMI 127
Issues Involved:
1. Allegation of criminal contempt by the Petitioner against the Respondents.
2. Proceedings initiated by the Respondents in various courts.
3. Suppression of material facts by the Respondents.
4. Bona fides of the Respondents' actions.
5. Determination of criminal contempt and its consequences.
6. Appropriate relief and injunction against the Respondents.
Detailed Analysis:
1. Allegation of Criminal Contempt by the Petitioner Against the Respondents:
The Petitioner, a company incorporated under the Companies Act, 1956, alleged that the Respondents were guilty of criminal contempt. The Petitioner claimed that the Respondents were initiating multiple frivolous, vexatious, and oppressive proceedings in different courts to delay and defeat the Petitioner's claims in pending money suits. The application was moved with the prior consent of the Advocate-General under Section 15(1)(b) of the Contempt of Courts Act, 1971.
2. Proceedings Initiated by the Respondents in Various Courts:
The Petitioner had instituted several money suits against the Respondents in the Court of the Subordinate Judge, Chinsurah, for recovery of unpaid prices of goods sold and delivered. The Respondents, in turn, initiated various proceedings in the Delhi High Court and the Calcutta High Court, seeking to stay or transfer these suits. The Respondents argued that the suits in Chinsurah were filed with mala fide intentions and that the balance of convenience favored trial in Delhi.
3. Suppression of Material Facts by the Respondents:
The Respondents were found to have suppressed material facts in their applications. For instance, they failed to disclose that similar grounds had already been adjudicated and dismissed by the Delhi High Court. The Calcutta High Court noted that the Respondents obtained interim orders by misleading the court through such suppression.
4. Bona Fides of the Respondents' Actions:
The Respondents contended that their actions were bona fide and taken upon legal advice to protect their legitimate rights. They argued that their proceedings were initiated to secure relief in accordance with the law and were not intended to abuse the court's process. However, the court found that the Respondents' actions were not bona fide, as they repeatedly initiated proceedings on the same grounds that had already been decided against them.
5. Determination of Criminal Contempt and Its Consequences:
The court held that the Respondents' actions amounted to criminal contempt under Section 2(c) of the Contempt of Courts Act, 1971. The court emphasized that such conduct interfered with the due course of judicial proceedings and obstructed the administration of justice. The court convicted Respondents Nos. 1 to 4 of criminal contempt, imposing a fine of Rs. 1,000 on each, with a default sentence of one month's simple imprisonment.
6. Appropriate Relief and Injunction Against the Respondents:
The Petitioner sought an injunction restraining the Respondents from initiating any further proceedings without the leave of the court. The court granted this injunction, recognizing the need to prevent further abuse of the judicial process. The court directed that the Respondents, their servants, and agents be restrained from initiating any suit or proceeding in any court regarding the pending money suits without first obtaining leave from the Calcutta High Court.
Conclusion:
The Calcutta High Court found the Respondents guilty of criminal contempt for abusing the judicial process by initiating multiple frivolous and vexatious proceedings. The court imposed fines on the guilty Respondents and issued an injunction to prevent further abuse. The judgment underscores the importance of maintaining the integrity of judicial proceedings and protecting litigants from oppressive and vexatious litigation.
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1977 (9) TMI 126
Issues Involved: Bail application after acquittal by High Court, considerations for granting bail, nature of offense, petitioner's background and social circumstances, conditions for bail.
In the judgment delivered by KRISHNA IYER, J., the petitioner sought bail after surrendering following the State's appeal against acquittal by the High Court.
The Court emphasized the general principle that bail should be preferred over jail, except in cases indicating a risk of fleeing from justice, obstructing justice, or engaging in further criminal activities. Factors such as the seriousness of the offense and the petitioner's criminal record are crucial in determining bail. Despite the gravity of the offense, the petitioner had been on bail during the trial and did not misuse the court's trust. His social standing and family responsibilities also supported his plea for bail. To address any concerns of evasion, the Court ordered the petitioner to report to the police station fortnightly. The petitioner was granted bail upon executing a bond with one surety for Rs. 5,000 to the satisfaction of the Additional District & Sessions Judge, Baren.
The Court acknowledged the traditional practice of pecuniary bail but suggested a reevaluation of this system in favor of more socially relevant alternatives, such as undertakings by the petitioner's relatives or affiliated organizations. Despite this suggestion, in the present case, the Court adhered to the monetary surety requirement and directed the provision of one surety for Rs. 5,000. The application for intervention was allowed, and bail was granted to the petitioner.
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1977 (9) TMI 125
Issues Involved:
1. Nature and effect of the irrevocable power of attorney.
2. Establishment of privity of contract between the plaintiff bank and the Government.
Detailed Analysis:
1. Nature and Effect of the Irrevocable Power of Attorney:
The judgment discusses the irrevocable power of attorney executed by the contractors in favor of the bank, which was deposited with the Government. The contractors had a cash and credit account with the appellant bank, and the bank was supplying money to the contractors for the construction work. The loans advanced by the bank were to be repaid from the money payable to the contractors by the Union of India. The irrevocable power of attorney (Exhibit P.2) gave the bank the exclusive right to realize and receive payments from the Government, and the contractors agreed they had no right to receive such payments as long as they maintained an overdraft account with the bank.
The court analyzed whether this irrevocable power of attorney amounted to an equitable assignment of the debt due from the Government to the contractors. The court referred to Section 202 of the Contract Act, which allows an agency to be irrevocable if the agent has an interest in the property subject to the agency. The court concluded that the power of attorney was an equitable assignment but not an absolute assignment, as the bank had to act as an agent of the contractors and could only receive money to the extent of the contractors' indebtedness. The court held that the irrevocable power of attorney did not authorize the bank to make an independent claim against the Government, as the contractors had to present the bill, and the Government had to measure the work done. The bank's role was limited to receiving payments on behalf of the contractors.
2. Establishment of Privity of Contract:
The court examined whether a privity of contract existed between the bank and the Government. The plaintiff bank argued that the irrevocable power of attorney amounted to an equitable assignment, establishing privity of contract with the Government. However, the court held that the basic concept of a contract is that it can confer rights or impose obligations only on persons who are parties to it. The court referred to Section 2(d) of the Contract Act, which states that consideration for a promise may proceed from the promisee or any other person.
The court analyzed clause 9-A of the contract between the Government and the contractors, which allowed payments to be made to the bank if the contractors desired so and provided a power of attorney. However, the proviso to clause 9-A stated that "nothing herein contained shall operate to create in favor of the bank any rights or equities vis-a-vis the President of India." The court concluded that while the bank may have an equitable assignment from the contractors, it did not have any enforceable rights against the Government. The Government's willingness to make payments to the bank was only as an agent of the contractors and not otherwise. The court emphasized that the authority given to the agent cannot exceed the powers of the principal.
The court dismissed the appeal, stating that there was no privity of contract between the bank and the Government, and even if there was, it was subject to the limitation that the bank was not authorized to enforce a claim against the Government. The court suggested that the remedy for banks in such situations is to have a tripartite contract between the debtor, the creditor, and the third party or to ensure that the original contract does not disable the creditor from transferring the right to enforce the contract to a third party.
Conclusion:
The appeal was dismissed, and the court ordered that the costs of the appeal be borne by the parties as incurred. The court noted that while the respondents (contractors) acted contrary to the power of attorney, the bank did not make any claim against them. The court suggested that the bank should have pursued a claim against the contractors if it suspected foul play.
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1977 (9) TMI 124
Issues Involved:
1. Forgery of cheque, requisition slip, and letter dated 7th Dec. 1967.
2. Wrongful dishonour of cheques dated 2nd Feb. 1968 and 5th Feb. 1968.
3. Estoppel from disputing payment made against cheque No. CSC/H.S. O47261.
4. Plaintiff's alleged loss and damages.
5. Defendant's alleged negligence in encashing the cheque for Rs. 13,701.
6. Relief entitlement for the plaintiff.
Issue-wise Detailed Analysis:
1. Forgery of Cheque, Requisition Slip, and Letter Dated 7th Dec. 1967:
The plaintiff claimed that the cheque No. CSC/H.S. O47261, the requisition slip, and the letter dated 7th Dec. 1967 were forged. The plaintiff denied issuing the cheque for Rs. 13,701 in favor of Soumen Kumar Chatterjee and alleged that the bank failed to exercise due care. The defendant bank argued that the plaintiff himself obtained a new cheque book after reporting the old one missing and that all transactions were conducted in the usual course of business without negligence. The court found no evidence of forgery and accepted the bank's evidence that the signatures on the documents were indeed the plaintiff's.
2. Wrongful Dishonour of Cheques Dated 2nd Feb. 1968 and 5th Feb. 1968:
The plaintiff alleged wrongful dishonour of two cheques for Rs. 19,000 and Rs. 7,900, respectively. The defendant bank contended that the cheque for Rs. 19,000 was dishonoured due to insufficient funds and discrepancies in the signature, while the cheque for Rs. 7,900 was dishonoured because it was from the missing cheque book, and the drawer's signature differed. The court found that the bank acted correctly based on the instructions and the status of the account, and there was no wrongful dishonour.
3. Estoppel from Disputing Payment Made Against Cheque No. CSC/H.S. O47261:
The defendant bank argued that the plaintiff was estopped from disputing the payment made against the cheque No. CSC/H.S. O47261. The court agreed with the bank, noting that the plaintiff had acknowledged the missing cheque book and had not pursued the matter diligently. The court found the plaintiff's conduct inconsistent and unconvincing, supporting the bank's position of estoppel.
4. Plaintiff's Alleged Loss and Damages:
The plaintiff claimed damages for the wrongful debit of Rs. 13,701 and additional losses amounting to Rs. 5,000. The court found no credible evidence to support the plaintiff's claim of loss and damages. The plaintiff's behavior and lack of prompt action undermined his claims. The court concluded that the plaintiff did not suffer the alleged losses due to the bank's actions.
5. Defendant's Alleged Negligence in Encashing the Cheque for Rs. 13,701:
The plaintiff alleged that the bank was negligent in encashing the cheque for Rs. 13,701. The defendant bank provided evidence that due care and diligence were exercised in processing the cheque. The court accepted the testimony of the bank employees, who confirmed that standard procedures were followed, and there was no negligence. The court held that the bank acted in good faith and without negligence.
6. Relief Entitlement for the Plaintiff:
The court concluded that the plaintiff was not entitled to any relief. The plaintiff's claims were dismissed based on the findings that the bank acted appropriately, there was no forgery, and the plaintiff failed to prove any negligence or loss. The court dismissed the suit with costs.
Conclusion:
The court dismissed the plaintiff's suit, finding no evidence of forgery, wrongful dishonour, or negligence by the defendant bank. The plaintiff was estopped from disputing the payment made against the cheque, and no damages were awarded. The bank was found to have acted in good faith and without negligence, and the plaintiff was not entitled to any relief.
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1977 (9) TMI 123
Issues:
1. Application for winding up of a company under Section 433 of the Companies Act.
2. Dispute regarding outstanding dues between the Creditor and the Company.
3. Allegations of commercial insolvency and inability to pay debts by the Company.
4. Invocation of arbitration clause for settlement of disputes.
5. Legitimacy of using a winding-up petition to enforce payment of disputed debt.
Analysis:
1. The application was filed for the winding up of a company under Section 433 of the Companies Act by a Creditor. The Company disputed the outstanding dues claimed by the Creditor, leading to a legal battle regarding the payment of the alleged debt.
2. The Creditor claimed that the Company owed a balance amount after certain construction works, despite partial payments made. The Company, on the other hand, contended that the Creditor's claim for excess dues was not agreed upon, and there were disputes regarding the alleged outstanding amount.
3. The Company argued that it was financially solvent and that the Creditor's winding-up petition was a coercive tactic to enforce payment of dues not owed. The Company maintained that there were bona fide disputes regarding the amount claimed by the Creditor, and it was not commercially insolvent.
4. The Company relied on an arbitration clause in the agreement between the parties for the settlement of disputes. The Court suggested referring the matter to arbitration, but the Creditor was not inclined to pursue arbitration, leading to further legal complexities in resolving the dispute.
5. The Court emphasized that a winding-up petition is not an appropriate method to enforce payment of a disputed debt. Citing legal precedents, the Court highlighted that a winding-up petition based on a disputed debt may be dismissed, especially if there is a bona fide dispute regarding the payability of the claimed amount. In this case, the Court found that there was a genuine dispute regarding the debt, leading to the dismissal of the winding-up petition.
In conclusion, the Court dismissed the winding-up petition by the Creditor, citing the lack of evidence to establish the debt and the presence of a bona fide dispute regarding the outstanding amount claimed. The Court emphasized the importance of resolving disputes through appropriate legal channels, such as arbitration, rather than using winding-up petitions as coercive measures for debt recovery.
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1977 (9) TMI 122
Issues Involved:
1. Validity of the cancellation of general and special powers of attorney.
2. Interpretation of "interest" under Section 202 of the Contract Act.
3. Irrevocability of the powers of attorney.
4. Obligation under the agreement of sale.
5. Payment of interest on the unpaid purchase money.
Detailed Analysis:
1. Validity of the Cancellation of General and Special Powers of Attorney:
The appellant argued that he had validly cancelled both the general and special powers of attorney executed in favor of Shri H.K. Gulati. The notice of cancellation (Exhibit D-2) was ambiguous and defective as it did not clearly specify which power of attorney was being cancelled. The court found that the notice referred to "the said power of attorney" without distinguishing between the general and special powers of attorney. According to Section 93 of the Evidence Act, evidence cannot be given to explain or rectify the ambiguity in the notice. Therefore, the notice was ineffective in cancelling either of the powers of attorney.
2. Interpretation of "Interest" under Section 202 of the Contract Act:
Section 202 of the Contract Act states that an agency cannot be terminated if the agent has an interest in the property forming the subject-matter of the agency. The term "interest" is broadly interpreted to include any advantage or benefit. In this case, the respondent had a legally enforceable right and interest in the property due to the agreement of sale. The court held that the respondent's interest in the property made the powers of attorney irrevocable under Section 202.
3. Irrevocability of the Powers of Attorney:
The general power of attorney was expressly stated to be irrevocable, while the special power of attorney did not have such a stipulation. However, the court ruled that both powers of attorney were irrevocable under Section 202 of the Contract Act because they were given for valuable consideration and to secure the interest of the agent (Shri Gulati) and the respondent. The court cited the case of Loonkaran Sethiya v. State Bank of Jaipur, where it was held that a power of attorney given for valuable consideration to effectuate a security or protect the agent's interest is irrevocable.
4. Obligation under the Agreement of Sale:
The appellant was under an obligation to execute the sale deed in favor of the respondent. The court noted that the appointment of Shri Gulati as the attorney was to facilitate the transaction of sale, and the appellant could not terminate this agency without causing prejudice to the respondent's interest. The court emphasized that the agency was created for the benefit of the respondent and her nominee, Shri Gulati, making it irrevocable.
5. Payment of Interest on the Unpaid Purchase Money:
The trial court had ordered the respondent to pay interest on the unpaid purchase money. However, Section 55(4)(b) of the Transfer of Property Act states that interest is payable only if possession of the property is delivered to the buyer. Since the possession had not been delivered to the respondent, the court held that the interest was not payable. The cross-objection was allowed, and the direction for the payment of interest was deleted from the trial court's judgment.
Conclusion:
The appeal was dismissed with costs, and the cross-objection was allowed. The court upheld the irrevocability of both the general and special powers of attorney under Section 202 of the Contract Act, and the respondent was not required to pay interest on the unpaid purchase money.
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1977 (9) TMI 121
Issues involved:
The issue in this case is whether a court appointing a receiver can grant leave to continue a suit against the receiver when a third party wants to prosecute such action initiated without permission, and what are the guidelines for granting such leave.
Summary:
The appellant filed a suit against the respondent, who is a receiver appointed by the court under Order 40, rule 1 of the Civil Procedure Code. The appellant alleged that the receiver wrongfully canceled a contract related to a coal mine without notice to him. The appellant sued the receiver for damages but did not initially seek permission from the court to do so. The court dismissed the appellant's application for permission to continue the suit against the receiver, stating that since the suit was filed without leave, no fresh permission was required. The High Court affirmed this decision, leading to the appellant's challenge of its propriety and legality.
The Supreme Court clarified that when a court appoints a receiver, the property comes under court custody, and any legal action without the court's permission may be considered contempt of court. The court has the inherent jurisdiction to grant leave to sue or continue proceedings against the receiver. The court emphasized that the grant of leave is the rule, and refusal is the exception, as long as the action is not meritless or vexatious. The court cited legal principles and precedents to support the requirement of obtaining leave to sue a receiver.
The court highlighted that failure to obtain leave before instituting a suit may be cured by obtaining leave during the proceedings, but failure to do so till the end of the case may have adverse consequences. The court rejected the extreme view that a suit must be dismissed if leave was not obtained before filing it. The court emphasized the importance of obtaining leave from the court appointing the receiver to avoid contempt of court and ensure the validity of legal proceedings.
In conclusion, the Supreme Court allowed the appeal, granting the appellant permission to prosecute the suit against the receiver. The court emphasized the need for a pragmatic view in such cases to prevent unnecessary delays in litigation.
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1977 (9) TMI 120
Issues Involved:
1. Whether the appeal was time-barred.
2. Interpretation of Section 12(2) of the Limitation Act, 1963, read with the Explanation.
3. Whether the appellant is entitled to exclude the time from the date of judgment to the signing of the decree.
4. Whether the High Court erred in refusing to condone the delay under Section 5 of the Limitation Act, 1963.
Issue-wise Detailed Analysis:
1. Whether the appeal was time-barred
The High Court dismissed the appeal as time-barred and refused to condone the delay under Section 5 of the Limitation Act, 1963. The appellant argued that the appeal was within the limitation period if the time was computed from May 6, 1976, when the deficient court fees were paid, and the final decree was drawn up and signed. The High Court, however, held that the appeal was time-barred, taking the date of the decree as March 27, 1976, the date of the judgment.
2. Interpretation of Section 12(2) of the Limitation Act, 1963, read with the Explanation
The Supreme Court examined Section 12(2) of the Limitation Act, 1963, which states that "the time requisite for obtaining a copy of the decree, sentence, or order appealed from or sought to be revised or reviewed shall be excluded." The Explanation clarifies that "any time taken by the court to prepare the decree or order before an application for a copy thereof is made shall not be excluded."
3. Whether the appellant is entitled to exclude the time from the date of judgment to the signing of the decree
The appellant contended that the time between the judgment and the signing of the decree should be excluded in computing the period of limitation. The Supreme Court, however, held that the Explanation to Section 12(2) does not allow exclusion of the time taken by the court to prepare the decree before an application for a copy is made. The Court emphasized that the Explanation was introduced to resolve the judicial controversy and to avoid giving a premium to unmerited idleness and indifference of litigants in making an application for a copy.
4. Whether the High Court erred in refusing to condone the delay under Section 5 of the Limitation Act, 1963
The Supreme Court noted that even if the legal position under Section 12(2) read with the Explanation did not support the appellant's claim, the High Court should have considered condoning the delay under Section 5 of the Limitation Act. The Court observed that there was no default on the part of the appellant and that the delay was due to the indifference or negligence of the appellant's advocate. The Court held that the appeal was not barred by limitation, considering the special facts of the case where the decree could not be prepared without the plaintiff depositing the deficient court fees.
Conclusion:
The Supreme Court allowed the appeal, set aside the judgment and decree of the High Court, and made no order as to costs. The Court expressed hope that the parties would settle the matter amicably when the records reach the High Court.
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1977 (9) TMI 118
Issues Involved:
1. Validity of the Government's order in revision u/s 77 of the Andhra Pradesh Co-operative Societies Act, 1964.
2. Compliance with section 77(2) regarding the opportunity to make representation.
3. Competence of the Registrar to entertain a petition u/s 77 against the Deputy Registrar's order.
4. The Government's authority to issue directions to the Excise Department in the matter of settlement of arrack shops.
Summary:
1. Validity of the Government's order in revision u/s 77 of the Andhra Pradesh Co-operative Societies Act, 1964:
The Supreme Court examined whether the Government's order dated 4th December 1976, passed in revision u/s 77 of the Act, was valid. The Court found that the Government did not comply with the mandatory provision of section 77(2), which requires giving the appellant an opportunity to make a representation before passing any prejudicial order. The Court held that the Government's order was invalid due to non-compliance with section 77(2) and violation of the principles of natural justice.
2. Compliance with section 77(2) regarding the opportunity to make representation:
The Court emphasized that section 77(2) mandates that no order prejudicial to any person shall be passed unless such person has been given an opportunity of making his representation. The Government failed to provide the appellant with notice or an opportunity to make a representation against the revision petition filed by the village societies. The Court rejected the High Court's view that the appellant's voluntary applications sufficed as compliance with section 77(2).
3. Competence of the Registrar to entertain a petition u/s 77 against the Deputy Registrar's order:
The Court addressed whether the Registrar could entertain a petition u/s 77 when the proceedings u/s 16(5) were questioned by the appellant. It was argued that since the Deputy Registrar exercised the powers of the Registrar, the Registrar could not review his own order. The Court distinguished this case from Roop Chand v. State of Punjab, stating that the Deputy Registrar acts under the general superintendence of the Registrar, and any order passed by the Deputy Registrar is appealable to the Registrar u/s 76(2)(ii). Therefore, the Registrar was competent to entertain the revision petition.
4. The Government's authority to issue directions to the Excise Department in the matter of settlement of arrack shops:
The Court noted that the Government's order included a "request" to the Excise Superintendent to take action regarding the appellant's licence and issue fresh licences to village societies. The Court held that any "request" from the Government to a subordinate authority is tantamount to a positive direction or order, which the subordinate authority would find difficult to disregard. However, the Court did not express an opinion on whether the Government was competent to issue such directions in the exercise of its revision power u/s 77.
Conclusion:
The Supreme Court set aside the judgment of the High Court and the Government's order dated 4th December 1976. The Court did not remand the revision petition to the Government due to the impending expiry of the arrack licences on 30th September 1977. The appeals were allowed, but no order as to costs was made.
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1977 (9) TMI 117
Issues involved: Application for bail pending appeal, practice of not releasing on bail for life imprisonment under section 302 IPC, reconsideration of the practice.
Summary:
The appellant was convicted by the Sessions Court for an offence under section 323 of the Indian Penal Code and sentenced to six months' rigorous imprisonment. Although acquitted of an offence under section 302, the High Court convicted him of the same and sentenced him to life imprisonment. The appellant filed a petition for special leave to appeal to the Supreme Court, which was granted. The appellant sought bail pending the appeal, considering the delay in the appeal hearing. The Court discussed the practice of not releasing on bail for life imprisonment under section 302 IPC, emphasizing the need for justice and avoiding unjust incarceration. Acknowledging the delay in appeal hearings, the Court decided to release the appellant on bail until the appeal is heard, considering the prima facie case and the time spent in jail already. The appellant was directed to report to the nearest police station fortnightly.
In conclusion, the Court allowed the appeal and directed the release of the appellant on bail to the satisfaction of the Chief Judicial Magistrate, Patiala.
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1977 (9) TMI 116
Issues:
1. Validity of lease created through a compromise petition.
2. Creation of a monthly tenancy post expiry of the lease period.
3. Interpretation of section 53A of the Transfer of Property Act.
Analysis:
1. The case involved an appeal regarding a lease created through a compromise petition where the appellant sought to establish a lease for sixteen years without registration. The Court held that the compromise petition, seeking to create the lease, needed to be registered to be valid. As it was unregistered, it did not affect the property and could not be considered evidence of any transaction affecting the property. The appellant's possession was found to be based on the compromise, extinguishing any prior interest after an earlier ejectment decree.
2. The appellant claimed the creation of a monthly tenancy post the lease period's expiry, citing regular rent payments as evidence. However, the Court emphasized that mere payment and acceptance of rent did not conclusively establish a tenancy. The Court rejected the appellant's contention, emphasizing that the intention to create a tenancy must be inferred from the circumstances. The High Court's finding that rent payments were part performance of the compromise contract, not indicative of a tenancy, was upheld.
3. Regarding section 53A of the Transfer of Property Act, the Court clarified that the section confers a right to defend possession, not an active title on the transferee. The appellant's compliance with the contract terms, including monthly rent payments, brought them under section 53A's protection. However, this did not automatically establish a tenancy post the agreed lease period. The Court emphasized that the existence of a tenancy depends on the parties' intention, determined from the facts of the case. The appellant's plea for tenancy was rejected based on the finding that rent payments were in part performance of the compromise contract, not indicative of a separate tenancy.
In conclusion, the Court dismissed the appeal, upholding the lower courts' findings that the appellant did not establish a monthly tenancy post the lease period's expiry. The judgment highlighted the need for registration of lease agreements and emphasized that rent payments alone do not necessarily create a tenancy, with the intention of the parties being crucial in determining the existence of a tenancy.
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1977 (9) TMI 115
Issues Involved:
1. Constitutionality of the transfer of a High Court Judge without their consent.
2. Validity and scope of consultation with the Chief Justice of India under Article 222(1) of the Constitution.
Detailed Analysis:
1. Constitutionality of the Transfer of a High Court Judge Without Their Consent:
- Argument by Respondent: The respondent argued that the transfer of a High Court Judge without their consent is unconstitutional. Article 222(1) of the Constitution should be interpreted to imply that a Judge cannot be transferred without their consent. The respondent emphasized that judicial independence could be undermined by vesting the power of transferring a Judge in the executive. The respondent contended that the transfer of a Judge from one High Court to another without their consent is calculated to undermine the independence of the judiciary.
- Court's Interpretation: The court held that the power to transfer a High Court Judge is conferred by the Constitution in public interest and not for the purpose of providing the executive with a weapon to punish a Judge. The court found that the Constitution does not explicitly require the consent of the Judge for their transfer. The court stated, "The power to transfer a High Court Judge is conferred by the Constitution in public interest and not for the purpose of providing the executive with a weapon to punish a Judge who does not toe its line."
- Conclusion: The court concluded that a High Court Judge could be transferred without their consent if the transfer is in public interest. The court emphasized that the power of transfer must be exercised reasonably and in furtherance of public interest. The court rejected the argument that the transfer of a High Court Judge without their consent is unconstitutional.
2. Validity and Scope of Consultation with the Chief Justice of India Under Article 222(1):
- Argument by Respondent: The respondent argued that effective consultation with the Chief Justice of India is a condition precedent to the exercise of the power to transfer a Judge under Article 222(1). The respondent contended that consultation means "effective consultation" and that the precondition of Article 222(1) that no transfer can be made without such consultation was not fulfilled.
- Court's Interpretation: The court held that consultation with the Chief Justice of India is obligatory and must be real and substantial. The court stated, "Consultation within the meaning of Article 222(1) means full and effective, not formal or unproductive, consultation." The court emphasized that the President must place all relevant data before the Chief Justice of India to enable him to tender his considered opinion on the subject. The court further stated that the Chief Justice of India must be given a reasonable opportunity to consider the relevant facts and circumstances before tendering his opinion.
- Conclusion: The court concluded that effective consultation with the Chief Justice of India is a mandatory requirement under Article 222(1). The court emphasized that the consultation must be meaningful and that the President must make the relevant data available to the Chief Justice of India. The court held that the transfer of a High Court Judge without effective consultation with the Chief Justice of India would be invalid.
Final Order:
The appeal was disposed of in terms of the settlement agreed upon by the parties. The court recorded the following order: "On the facts and circumstances on record the present government do not consider that there was any justification for transferring Justice Sheth from Gujarat High Court and propose to transfer him back to that High Court. On this statement being made by the learned Attorney General, Mr. Seervai, Counsel for Respondent No. 1 (Justice S. H. Sheth), withdraws the writ petition with leave of the Court."
Separate Judgments:
- CHANDRACHUD, J.: Emphasized the importance of judicial independence and the need for effective consultation with the Chief Justice of India. Concluded that a High Court Judge could be transferred without their consent if the transfer is in public interest.
- BHAGWATI, J.: Highlighted the significance of judicial independence and the need for meaningful consultation with the Chief Justice of India. Concluded that the transfer of a High Court Judge without their consent would undermine judicial independence.
- KRISHNA IYER, J.: Stressed the importance of judicial independence and the role of the judiciary in upholding the Constitution. Emphasized the need for effective consultation with the Chief Justice of India and concluded that the transfer of a High Court Judge without their consent is permissible if it is in public interest.
- UNTWALIA, J.: Agreed with the need for effective consultation with the Chief Justice of India. Emphasized the importance of judicial independence and expressed concerns about the potential misuse of the power to transfer Judges.
Summary:
The Supreme Court of India held that the transfer of a High Court Judge without their consent is constitutional if the transfer is in public interest. The court emphasized that effective consultation with the Chief Justice of India is a mandatory requirement under Article 222(1) of the Constitution. The consultation must be meaningful, and the President must make the relevant data available to the Chief Justice of India. The appeal was disposed of based on a settlement agreed upon by the parties, with the present government proposing to transfer Justice Sheth back to the Gujarat High Court.
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1977 (9) TMI 114
Issues Involved:
1. Maintainability of the writ petition due to lack of a completed, binding, and enforceable contract.
2. Applicability of the doctrine of promissory estoppel.
3. Issuance of a writ of mandamus in the absence of a statutory duty.
Summary:
Re: Contention No. 1:
The Supreme Court held that the settlement of the Jalkar with respondent No. 1 was not made and executed in the manner prescribed by Article 299 of the Constitution. The provisions of Article 299 are mandatory and require that a contract made in the exercise of the executive power must satisfy three conditions: it must be expressed to be made by the President or Governor, executed on their behalf, and executed by such person and in such manner as directed or authorized by them. Failure to comply with these conditions nullifies the contract, rendering it void and unenforceable. Additionally, the right to catch and carry away fish, being a 'profit a prendre', is considered immovable property and must be transferred by a registered instrument. Since the settlement was not effected by a registered instrument, respondent No. 1 had no enforceable right, title, or interest. Consequently, the writ petition was misconceived and should have been dismissed.
Re: Contention No. 2:
The doctrine of promissory estoppel was not applicable in this case. Respondent No. 1 neither deposited the required amount for the execution of the lease agreement nor was any 'Parwana' issued to him. The High Court rejected his plea regarding investments made based on the Government's order. The doctrine of promissory estoppel cannot be invoked against the Government in the exercise of its sovereign legislative and executive functions. The case cited by respondent No. 1, Union of India & Ors. v. M/s Indo-Afghan Agencies Ltd., was distinguishable as it involved enforcing compliance with an obligation under an Export Promotion Scheme, not a contractual right.
Re: Contention No. 3:
A writ of mandamus can only be granted where there is a statutory duty imposed upon the officer concerned and a failure to discharge that duty. In this case, respondent No. 1 did not show any statute or rule imposing a duty on respondents 2 to 4, which they failed to perform. The obligation sought to be enforced was contractual and not binding or enforceable. Therefore, respondent No. 1 was not entitled to a writ of mandamus under Article 226 of the Constitution, and the High Court was not competent to issue the same.
Relief Granted:
The appeal was allowed concerning the year 1977-78. The Government was permitted to grant fishery rights to the appellant in conformity with its policy and procedure, provided the appellant fulfilled the conditions. If the Government settled the Jalkar with the appellant or another Fisherman Society, it was to refund respondent No. 1 a proportionate amount of the Jamma deposited for the year 1977-78 based on section 70 of the Contract Act.
Conclusion:
The Supreme Court overruled the High Court's judgment, allowing the appeal for the year 1977-78 and leaving it open for the Government to grant fishery rights to the appellant in accordance with its policy. There was no order as to costs.
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1977 (9) TMI 113
Issues:
1. Whether the process of slitting and re-rolling of duty paid paper rolls constitutes the manufacture of paper.
2. Whether duty is chargeable on the paper under Tariff Item 17(2).
3. Whether a Central Excise Licence under Item 17 is required for the process.
Analysis:
1. The Assistant Collector determined that the process of slitting and re-rolling of duty paid paper rolls resulted in a new product assessable to duty under Tariff Item 17(2). The Assistant Collector required the appellants to obtain a Central Excise Licence under Tariff Item 17 and pay duty accordingly. The appellants argued that slitting paper does not alter its characteristics significantly, and no new product emerges. They compared it to stationery marts cutting full sheets of paper into smaller sizes, which is not considered manufacturing. The appellants contended that if slitting and re-rolling are termed manufacturing, then cutting paper into reams should also attract duty, which is not the case in practice.
2. The Commissioner analyzed the operation carried out by the appellants, where they cut duty paid paper rolls into various sizes without altering the original characteristics of the paper. The Commissioner concluded that this process did not amount to manufacturing as no new product with changed characteristics was created. The resultant product retained the identity of the original paper, unlike converted paper types such as Bituminised paper or plasticised paper. As no manufacturing process attracting duty under Tariff Item 17(2) occurred, the Commissioner ruled that no Central Excise Licence was required for the process, and no further duty levy was applicable on the paper cut and re-rolled by the appellants.
3. Ultimately, the Commissioner set aside the Assistant Collector's order and allowed the appeal, providing consequential relief to the appellants. The decision was based on the finding that the process of slitting and re-rolling duty paid paper rolls did not constitute manufacturing under Tariff Item 17(2), and therefore, no duty or licence obligation applied.
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1977 (9) TMI 112
The judgment in the case of Collector Central Excise, New Delhi v. Shri K.K. Kapoor held that cinema seats were not to be considered as steel furniture under Item 40 of the Central Excise Tariff. The seats were deemed as fixtures inseparable from the cinema hall under the Delhi Cinematograph rules. The appeal was accepted, and consequential relief was to be allowed. (Citation: 1977 (9) TMI 112)
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1977 (9) TMI 111
The judgment in the case of Collector of Customs and Central Excise, Bombay states that the appeal by Messrs. NIPA Tex Corporation against the demand for duty was allowed. The change in ownership did not involve a reduction or increase in the number of power looms, so no higher rate of duty was required. The order of the Assistant Collector was set aside, and the appeal was allowed.
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1977 (9) TMI 110
Issues Involved:
1. Determination of assessable value for excise duty.
2. Inclusion of special packing charges, forwarding charges, and freight in the assessable value.
3. Disallowance of trade discounts.
4. Violation of principles of natural justice.
5. Maintainability of the petition under Article 226 of the Constitution.
6. Claim for refund of excise duty.
Detailed Analysis:
1. Determination of Assessable Value for Excise Duty:
The petitioner, a manufacturer of glass products, challenged the orders determining the assessable value of their products for excise duty. The assessable value was calculated by including special packing charges, forwarding charges, and freight. The petitioner argued that these charges should be excluded from the assessable value as per Section 4 of the Central Excise and Salt Act, 1944. The court referenced the Supreme Court's decision in A.K. Roy v. Voltas Ltd., which established that excise duty should only include manufacturing costs and profits, excluding post-manufacturing expenses.
2. Inclusion of Special Packing Charges, Forwarding Charges, and Freight in the Assessable Value:
The respondents included special packing charges, forwarding charges, and freight in the assessable value, arguing that these charges were necessary due to the delicate nature of the glass products. However, the court found that these charges are post-manufacturing expenses and should not be included in the assessable value. The court cited several judgments, including Atic Industries v. Assistant Collector of Central Excise and Union of India v. Mansingha Industries Pvt. Ltd., to support this view.
3. Disallowance of Trade Discounts:
The petitioner claimed deductions for trade discounts, which were disallowed by the Superintendent of Central Excise on the grounds that the discounts were not uniformly available to all independent buyers in all regions. The court held that trade discounts should be allowed as per the explanation to Section 4 of the Act. If trade discounts are given at different rates to traders in different regions, an average rate should be computed and allowed.
4. Violation of Principles of Natural Justice:
The petitioner argued that the orders determining the assessable value were passed without affording them an opportunity to be heard, violating the principles of natural justice. The court agreed, stating that the breach of natural justice could not be cured by an appellate process. The court referenced several cases, including Ridge v. Baldwin and Ponkunnam Trader v. Addl. Income Tax Officer, Kottayam, to support this view.
5. Maintainability of the Petition under Article 226 of the Constitution:
The respondents raised a preliminary objection, arguing that the petition under Article 226 was not maintainable due to the availability of an appellate remedy under Section 35 of the Central Excise and Salt Act, 1944. The court overruled this objection, stating that a violation of natural justice could not be cured by an appellate process. The court also noted that if the assessable value was determined without any authority of law, the petition under Article 226 was maintainable.
6. Claim for Refund of Excise Duty:
The petitioner sought a refund of Rs. 47,71,166.00, arguing that the excise duty was wrongly levied on selling costs and profits. The court rejected this claim, noting that the petitioner had not raised the issue of refund or submitted price lists showing the breakdown of manufacturing and selling costs at any stage. The court referenced Ogle Glass Works v. Union of India, where a similar claim for refund was denied.
Conclusion:
The court quashed the orders of assessment for the months of April 1971 to September 1973 and the demand of Rs. 46,227.92. However, the petitioner's claim for a refund of Rs. 47,71,166.00 was rejected. The court directed the Central Excise Authorities to make a fresh assessment for the specified periods after affording the petitioner an opportunity to be heard, in accordance with the law. There was no order as to costs, and the operation of the order was stayed for two weeks after the long vacation.
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1977 (9) TMI 109
The writ petition by Steel Enterprises (Private) Ltd., Kanpur, challenging the validity of the order dated 28-2-1975 passed by the Collector of Central Excise, Kanpur was dismissed by the High Court due to the existence of an alternative remedy under Section 128 of the Customs Act. The petition failed and was dismissed without costs.
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1977 (9) TMI 108
Issues:
1. Interpretation of exemption from sales tax for a partnership firm.
2. Recognition of a new industrial unit for exemption benefits.
3. Validity of exemption certificate for raw materials.
Detailed Analysis:
1. The petitioner, a partnership firm, sought to quash orders denying exemption from sales tax on raw materials for manufacturing M.S. rods. The dispute arose regarding the period of exemption under a notification issued by the State Government to promote small-scale industries. The firm's contention was that a new industrial unit for M.S. rods was distinct from the existing unit for buckets and agricultural implements. The authorities rejected this claim, leading to the legal challenge.
2. The facts revealed the establishment of a new firm for M.S. rods production, with amendments made to the registration and exemption certificate to include this product. The petitioner argued that the new unit should be treated separately for the exemption period calculation. However, the respondents contended that no new firm was formed, only additional partners were included, and the original firm had already received exemption benefits for five years.
3. The court analyzed the notification's requirements for approval and registration by the industries department before granting exemption certificates. Despite amendments to include M.S. rods in the exemption certificate, the court held that the certificate's validity remained until the original expiration date, not extended for the new product. As paragraph 2 of the certificate specified the validity period, no extension was granted beyond the initial five years, leading to the dismissal of the petitioner's claims.
In conclusion, the court dismissed the petition, emphasizing the importance of adherence to the terms of exemption notifications and the validity period specified in exemption certificates. The judgment highlighted the necessity for proper registration and approval processes for availing exemption benefits under relevant laws, ultimately ruling against the petitioner's claims for extended exemption beyond the stipulated period.
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