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• 1991 (4) TMI 469
  
  ISSUES PRESENTED and CONSIDERED

  The core legal question considered in this judgment is whether the retrospective promotion of certain Overseers to the position of Assistant Engineers in the Bihar Engineering Service, Class II, thereby altering the seniority list to the detriment of directly recruited Assistant Engineers, is arbitrary, illegal, and inoperative. Specifically, the issue revolves around the legality and fairness of government orders that retrospectively promoted Overseers to fill a reserved quota from an earlier year, impacting the seniority of directly recruited Assistant Engineers.

  ISSUE-WISE DETAILED ANALYSIS

  Relevant Legal Framework and Precedents

  The legal framework involves Rule 2 of the Public Works Department Code, which allowed for 25% of posts in the Bihar Engineering Service, Class II to be filled by promotion. The case also references precedents such as A.K. Subraman and Ors. v. Union of India and D.K. Mitra and Ors. v. Union of India, which discuss the principles of seniority and the implications of retrospective promotions.

  Court's Interpretation and Reasoning

  The Court interpreted that no person can be promoted with retrospective effect from a date when they were not part of the cadre, especially if such promotion adversely affects others. The Court emphasized that seniority should be determined based on the date of initial entry into the service, and retrospective promotions that disrupt this principle are considered arbitrary and illegal.

  Key Evidence and Findings

  The evidence presented included government orders and seniority lists. The Court found that the orders promoting the Overseers retrospectively were issued without considering the adverse impact on the seniority of directly recruited Assistant Engineers. The seniority list published in 1969, where the petitioners were shown as senior, was altered by subsequent government orders, which the Court found unjustifiable.

  Application of Law to Facts

  The Court applied the legal principle that seniority is reckoned from the date of entry into the service. The directly recruited Assistant Engineers entered the service before the promoted Overseers, and thus, the retrospective promotions could not legally alter their seniority. The Court found that the government orders in question were arbitrary and violated established legal principles.

  Treatment of Competing Arguments

  The appellants argued that the retrospective promotions were justified under the quota system established in 1958. However, the Court dismissed this argument, noting that the vacancies from 1958 were not carried forward and that the retrospective promotions adversely affected the rights of the directly recruited Assistant Engineers. The Court also distinguished this case from precedents cited by the appellants, noting that those cases involved different circumstances where vacancies were carried forward.

  Conclusions

  The Court concluded that the retrospective promotions were illegal and unjust, as they adversely affected the seniority of the directly recruited Assistant Engineers. The government orders were quashed, and the seniority list was to remain as initially published.

  SIGNIFICANT HOLDINGS

  Core Principles Established

  The Court reiterated the principle that no person can be promoted with retrospective effect from a date when they were not part of the cadre, especially if it adversely affects others. Seniority should be based on the date of initial entry into the service.

  Final Determinations on Each Issue

  The Court upheld the High Court's decision to quash the government orders that retrospectively promoted the Overseers. The appeals were dismissed, and the seniority of the directly recruited Assistant Engineers was maintained as per the original list.

  The judgment reinforces the principle that retrospective promotions affecting the seniority of others are not permissible under the law, ensuring fairness and adherence to established legal norms in determining seniority within a service cadre.

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• 1991 (4) TMI 468
  
  Issues Involved:
  1. Legality of the conviction under Section 409 IPC.
  2. Practice of credit sales and its implications.
  3. Allegations of forgery and use of forged documents.
  4. Entrustment and misappropriation of property.
  5. Liability of the second appellant for actions before taking charge.
  6. Conspiracy and joint liability.
  7. Appellants' entitlement to back wages upon acquittal.
  
  Issue-Wise Detailed Analysis:
  
  1. Legality of the Conviction under Section 409 IPC:
  The High Court had confirmed the conviction of the appellants under Section 409 IPC, but the Supreme Court examined whether the essential elements of criminal breach of trust were satisfied. The Court noted that the entrustment of property was not disputed, but the prosecution failed to prove dishonest misappropriation or conversion of property by the appellants. The Court found that the High Court did not adequately discuss the evidence or the legal question of dishonest misappropriation, leading to the conclusion that the conviction under Section 409 IPC could not be sustained.
  
  2. Practice of Credit Sales and Its Implications:
  The Court acknowledged the long-standing practice of credit sales from government seed stores, despite circulars prohibiting such sales. The repeated issuance of circulars indicated that the practice continued, and the superior officers did not take serious action against it. The Court concluded that following the established practice of credit sales could not be considered criminal breach of trust.
  
  3. Allegations of Forgery and Use of Forged Documents:
  The High Court had acquitted the appellants of charges under Sections 467 and 471 IPC, and the State did not appeal this acquittal. The Supreme Court noted that this acquittal implied the prosecution's failure to prove that the bills and receipts were forged or fraudulently used. Consequently, the Court accepted the appellants' defense that the documents were genuine.
  
  4. Entrustment and Misappropriation of Property:
  The prosecution alleged that the first appellant misappropriated amounts covered by certain bills. However, the evidence showed that the amounts were deposited before the CID investigation began. The Court found no outstanding amounts and noted that the first appellant's defense that the bills were genuine was accepted by the High Court. Therefore, the prosecution did not prove temporary misappropriation.
  
  5. Liability of the Second Appellant for Actions Before Taking Charge:
  The second appellant took charge of the seed store on 2.9.65, and the bills in question were prepared before this date. The Court found it illogical to hold the second appellant liable for actions taken before he assumed charge. Therefore, the second appellant could not be held liable for the alleged misappropriation under Section 409 IPC.
  
  6. Conspiracy and Joint Liability:
  The Court found no evidence of conspiracy or pre-arranged plan between the appellants to commit the alleged offenses. The prosecution failed to establish any concert of minds or pre-concert between the appellants. Consequently, the charge of criminal breach of trust against both appellants could not be sustained.
  
  7. Appellants' Entitlement to Back Wages Upon Acquittal:
  The appellants submitted affidavits stating they would not claim back wages if reinstated. The Court observed that, based on this undertaking and the case's circumstances, the appellants would not be entitled to back wages from the date of suspension to reinstatement, despite ordinarily being entitled to such wages upon acquittal.
  
  Conclusion:
  The Supreme Court allowed the appeals, setting aside the convictions and sentences awarded by the High Court, and acquitted the appellants. The Court also noted the appellants' undertaking not to claim back wages if reinstated, directing that they would not be entitled to back wages from the suspension date to reinstatement.

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• 1991 (4) TMI 467
  
  Issues:
  Interpretation of the word "production" in a notification for excise duty relief.
  Determining the eligibility of a company for excise duty relief based on the commencement of commercial production.
  Jurisdiction of the Court in going into disputed questions of fact in a writ petition under Article 226 of the Constitution of India.
  
  Analysis:
  The case involved an appeal against a judgment in a writ petition filed under Article 226 of the Constitution of India. The appellant, a cement manufacturing company, claimed excise duty relief under various notifications issued by the Government of India. The dispute centered around the interpretation of the word "production" in the notifications and the eligibility criteria based on the commencement of commercial production by the appellant.
  
  The appellant contended that they were entitled to excise duty relief as a new unit starting commercial production after 1.1.1982. They relied on a letter from the Joint Cement Controller fixing the date of commercial production as 2.1.1982. However, the Assistant Collector of Customs rejected their claim, stating that the appellant had commenced production in 1981 and was not eligible for relief under the notifications.
  
  The Collector (Appeals) upheld the rejection, emphasizing that the appellant had started production before 1.1.1982 and was maintaining records since 1981. The Single Judge held that "production" in the notification referred to commercial production and concluded that the appellant had commenced production before 1.1.1982, thus not qualifying for relief.
  
  The Court considered the arguments of both parties and opined that the Single Judge should not have delved into the disputed fact of when commercial production began. It was determined that the authorities had not properly considered the date of commercial production while rejecting the appellant's claim. The Court directed the Assistant Collector to reevaluate the applicability of the notification based on the commencement of commercial production by the appellant within three months, allowing the appellant a fair opportunity to prove their case.
  
  In conclusion, the Court partially allowed the appeal, setting aside previous decisions and instructing a reevaluation of the appellant's eligibility for excise duty relief based on the correct date of commercial production. The judgment highlighted the importance of interpreting legal terms accurately and ensuring proper consideration of relevant facts in determining eligibility for statutory benefits.

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• 1991 (4) TMI 466
  
  The High Court dismissed the revision petition against the trial court's order to add Satinderjit Singh as a defendant in a specific performance suit, stating that his presence was necessary for effective adjudication. The petition was dismissed, and the petitioner was directed to appear in the trial court on a specified date.

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• 1991 (4) TMI 465
  
  Issues:
  1. Jurisdiction of Civil Court to correct date of birth in service record and grant injunction against superannuation.
  2. Applicability of Section 2-A of the Industrial Disputes Act in determining cause of action.
  3. Jurisdiction of Civil Court to provide ancillary reliefs to a workman against the employer.
  
  Analysis:
  1. The appellant, a workman, sought correction of his date of birth in the service record to avoid superannuation. The employer challenged the Civil Court's jurisdiction to entertain the suit. The Court held that matters falling under Section 9 of the CPC are maintainable in the Civil Court, allowing correction of the date of birth for various purposes beyond Industrial Disputes Act relief claims.
  
  2. The employer contested the Civil Court's jurisdiction based on Section 2-A of the Industrial Disputes Act. The Court noted that as of the filing date of the suit, no events triggering Section 2-A had occurred, thus the appellant couldn't seek relief under the Act. The timing of the suit initiation is crucial in determining the forum's jurisdiction.
  
  3. The appellant also sought an injunction against superannuation and ancillary reliefs. The Court affirmed that if part of the relief falls within the forum's jurisdiction, it cannot deny other related reliefs. While the appellant had superannuated by the judgment, rectification of the date of birth entitled him to backwages. The Court suggested the Public Sector Undertaking settle the claim rather than forcing the appellant into further legal proceedings. The Civil Court had jurisdiction for rectification, but other reliefs might require a different forum as per law.

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• 1991 (4) TMI 464
  
  Issues:
  1. Application under S. 5 of the Limitation Act for condonation of delay in filing an appeal.
  2. Tampering with a certified copy of a judgment leading to confusion regarding the date of readiness.
  3. Lack of supervision in the Copying Department leading to issuance of certified copies in violation of rules.
  
  Detailed Analysis:
  1. The judgment addressed an application under S. 5 of the Limitation Act seeking condonation of delay in filing an appeal. The appeal was presented seven days beyond the stipulated time limit. The appellant moved the application supported by affidavits explaining the delay. The court examined the sequence of events and the actions taken by the appellant before the expiration of the limitation period. The court acknowledged that the delay was not due to any fault of the appellant but possibly due to the counsel or their office. The court, after thorough consideration, decided to allow the application and condone the delay of seven days in filing the appeal.
  
  2. The judgment highlighted a situation where tampering with a certified copy of a judgment created confusion regarding the date of readiness of the copy. The court observed discrepancies in the certified copy, leading to suspicion and subsequent investigations. The court noted that the tampering was likely done after the copy was handed over to the counsel, as the original date was intact until that point. The judgment emphasized the importance of maintaining the integrity of official records and expressed regret over the incident. The court, while unable to pinpoint the guilty party, directed an inquiry into the matter and stressed the need for stricter supervision to prevent such occurrences in the future.
  
  3. The judgment delved into the issue of lack of supervision in the Copying Department, resulting in the issuance of certified copies in violation of rules. The court highlighted the rules governing the preparation and issuance of certified copies, emphasizing the importance of including specific dates in words and figures to prevent tampering. The court directed the District Judge to conduct an immediate inquiry, fix responsibility, and take necessary actions against those found guilty. The judgment underscored the repeated failures to address these issues despite circular letters from the High Court, necessitating judicial intervention to curb the malpractices in certified copy issuance.
  
  In conclusion, the judgment addressed the application for condonation of delay, the tampering with a certified copy leading to confusion, and the need for improved supervision in the Copying Department to uphold the integrity of official records and prevent violations of rules in certified copy issuance.

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• 1991 (4) TMI 463
  
  Issues:
  1. Representation of heirs in eviction proceedings.
  2. Effect of eviction decree on non-named heirs.
  3. Interpretation of Hindu Succession Act in tenancy matters.
  4. Legal principle of representation in judicial proceedings.
  
  Analysis:
  
  Issue 1: Representation of heirs in eviction proceedings
  The judgment involves two cases concerning the representation of heirs in eviction proceedings. In the first case, the appellant claims to be a daughter of the original tenant and objects to the eviction decree obtained against other family members. The landlord denies her existence as a daughter and alleges collusion. The second case involves unmarried daughters objecting to eviction proceedings initiated against the family without their inclusion as parties. The landlord argues that the heirs succeed as joint tenants and are adequately represented by the named parties.
  
  Issue 2: Effect of eviction decree on non-named heirs
  The contention revolves around whether the eviction decree obtained against some family members binds non-named heirs. The appellants argue that the decree should not affect them as they were not included in the proceedings. They rely on legal precedents to support their claim that the decree cannot be enforced against them.
  
  Issue 3: Interpretation of Hindu Succession Act in tenancy matters
  The judgment discusses the application of the Hindu Succession Act to the devolution of tenancy rights. The landlords argue that the heirs succeed as joint tenants and the tenancy remains undivided. The appellants challenge this interpretation, citing legal distinctions and precedents to support their claim that each heir holds an independent title in the tenancy.
  
  Issue 4: Legal principle of representation in judicial proceedings
  The judgment delves into the legal principle of representation in judicial proceedings. It discusses scenarios where a named party represents others' interests in litigation. The court emphasizes the importance of bona fide representation and highlights that the interest of a person must genuinely be looked after by the representative. The judgment distinguishes between cases where the representation is clear and cases where evidence is required to determine the adequacy of representation.
  
  In conclusion, the Supreme Court allowed the appeal of one appellant, remitting the matter to the executing court for further evidence. However, the appeal of the other appellant was dismissed due to lack of evidence and effective representation by named parties. The judgment clarifies the principles of representation in legal proceedings and the impact of eviction decrees on non-named heirs in tenancy matters.

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• 1991 (4) TMI 462
  
  Issues Involved:
  1. Grant of Bail under Section 167(2) Cr.P.C.
  2. Definition and Interpretation of 'Custody' under Section 167(2) Cr.P.C.
  3. Effect of Filing Charge Sheet on Right to Bail under Section 167(2) Cr.P.C.
  
  Issue-Wise Detailed Analysis:
  
  1. Grant of Bail under Section 167(2) Cr.P.C.
  The petitioner sought bail under Section 167(2) Cr.P.C. on the grounds that the police filed the charge sheet more than 90 days after his arrest. The court examined whether the period of the petitioner's stay in the hospital under police surveillance could be considered as 'custody' for the purpose of calculating the 90-day period. The court concluded that the period from 30-9-1989 to 12-11-1989, during which the petitioner was under police surveillance in the hospital, must be considered as a period of custody. Therefore, the charge sheet was filed after 137 days, exceeding the 90-day limit prescribed under Section 167(2) Cr.P.C.
  
  2. Definition and Interpretation of 'Custody' under Section 167(2) Cr.P.C.
  The court referred to various judgments to interpret the term 'custody.' It cited the Bombay High Court's decision in Ashak Hussain Allah Detha Alias Siddique And Anr. V. Assistant Collector of Customs (P) Bombay And Anr., which defined 'arrest' as a restraint on a person's liberty by lawful authority. The court also referred to Mihir Adhikary V. The State from the Calcutta High Court, which held that 'custody' includes being under police surveillance or restriction on movements. The court concluded that the petitioner's stay in the hospital under police surveillance constituted 'custody' under Section 167(2) Cr.P.C.
  
  3. Effect of Filing Charge Sheet on Right to Bail under Section 167(2) Cr.P.C.
  The court discussed whether the right to bail under Section 167(2) Cr.P.C. is affected by the subsequent filing of a charge sheet. The learned Government Pleader argued that once a charge sheet is filed, the right to bail under Section 167(2) Cr.P.C. is lost. However, the court referred to several judgments, including Raghubir Singh And Ors. v. State of Bihar and Rajnikant Jivanlal Patel And Anr. v. Intelligence Officer, Narcotic Control Bureau, New Delhi, which held that the right to bail under Section 167(2) Cr.P.C. is not defeated by the filing of a charge sheet or by the lapse of time. The court concluded that the petitioner is entitled to bail under Section 167(2) Cr.P.C. even though he applied for bail after the filing of the charge sheet, as the right accrued to him cannot be defeated by the prosecution's delay in filing the charge sheet within the stipulated period of 90 days.
  
  Conclusion:
  The petition for bail was allowed. The court directed the release of the petitioner on bail upon executing a bond for Rs. 10,000/- with one solvent surety for the like sum, subject to the conditions that the petitioner shall not tamper with prosecution witnesses or records and shall not leave the municipal limits of Mysore City without prior permission.
  
  Order:
  The learned Sessions Judge, Mysore, is directed to release the petitioner on bail on his executing a bond for Rs. 10,000/- with one solvent surety for the like sum to the satisfaction of the learned Sessions Judge, Mysore. The bail is granted subject to the following conditions:
  1. The petitioner shall not tamper with the prosecution witnesses or records in any manner.
  2. The petitioner shall not leave the municipal limits of Mysore City without the prior permission of the Principal Sessions Judge, Mysore.

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• 1991 (4) TMI 461
  
  Issues:
  - Bail application under Section 439 of the Code of Criminal Procedure
  - Presence of silver slabs in truck intercepted by Directorate of Revenue Intelligence
  - Allegation of smuggling silver from Pakistan
  - Arguments regarding lack of corroborative evidence and admissibility of statements
  - Consideration of bail based on severity of offense and likelihood of tampering with evidence or committing similar offenses
  
  Analysis:
  The petitioner filed a bail application under Section 439 of the Code of Criminal Procedure, seeking release. The case involved the interception of a truck by the Directorate of Revenue Intelligence (DIR), where silver slabs were found concealed. The petitioner, along with others, was present at the scene. The petitioner's counsel argued lack of corroborative evidence to prove smuggling from Pakistan and inadmissibility of co-accused statements. The State contended that concrete information indicated the silver's origin and the petitioner's involvement. The court considered the circumstances, including the early morning interception and the petitioner's proximity to the location, suggesting prior knowledge. The concealment of silver under soil indicated clandestine efforts, supporting the smuggling allegation. The petitioner's statement under Section 108 of the Customs Act, mentioning his involvement in smuggling activities, further implicated him.
  
  The court referenced previous cases emphasizing the seriousness of economic offenses and the community's interest in prosecuting such offenders. The petitioner's alleged history of involvement in smuggling activities, including a prior seizure case, raised concerns about potential future offenses if granted bail. Considering these factors, the court concluded that it was not a suitable case for bail. The court clarified that its decision did not prejudice the trial court's independent assessment of the bail application. Ultimately, the petition for bail was dismissed, maintaining the petitioner's custody pending trial.

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• 1991 (4) TMI 460
  
  ... ...
  ... ... ..... jha, JJ. ORDER Appeal dismissed.

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• 1991 (4) TMI 459
  
  Issues:
  Levy of penalty under section 271(1)(c) of the Income Tax Act for unproved cash credits.
  
  Detailed Analysis:
  
  1. Question 1 & 2: The petitioner contested the validity of the penalty order under section 271(1)(c) based on the incorrect application of the Explanation provisions. The Tribunal upheld the penalty, stating that a mere mention of a wrong section by the Income Tax Officer does not invalidate the order. The Commissioner (A) confirmed that the correct Explanation was applicable, and the Tribunal found that the provisions of section 271(1)(c) were indeed attracted, dismissing the petitioner's argument.
  
  2. Question 3: The petitioner argued that the Tribunal erred in rejecting their explanation for the cash credits. However, the Tribunal, after assessing the facts, found the explanation to be unsubstantiated and deemed the loan theory as bogus, concluding it as a finding of fact.
  
  3. Question 4: The petitioner claimed that the cash credits were genuine, but the Tribunal determined otherwise after reviewing the evidence, stating that the petitioner failed to prove the absence of fraud or willful neglect, which was considered a factual finding.
  
  4. Question 5: The petitioner contended that the Tribunal did not establish the cash credits as income for the relevant year, but the Tribunal found the sum to be the petitioner's income for the year, dismissing the loan theory as unsubstantiated.
  
  5. Question 6: The petitioner argued against the penalty under section 271(1)(c) based on deeming provisions, but the Tribunal found unproved cash credits and rejected the loan theory, deeming it a factual finding.
  
  6. Question 7: The petitioner claimed that the Tribunal did not follow the decision in a specific case, but the Tribunal, after reviewing the facts, concluded that the penalty was applicable under section 271(1)(c).
  
  7. Question 8: The petitioner argued that the Income Tax Officer lacked jurisdiction to impose the penalty. However, the Tribunal clarified that the omission of a provision in the statute allowed the Income Tax Officer to impose the penalty, dismissing the petitioner's jurisdictional argument.
  
  In conclusion, the High Court dismissed the petitioner's request for reference, concurring with the Tribunal's findings that no question of law necessitated a referral. The petition was consequently dismissed with no costs awarded.

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• 1991 (4) TMI 458
  
  Issues Involved:
  1. Institution, signing, and verification of the suit.
  2. Existence of a concluded contract.
  3. Nature of the payment (advance rent or token money).
  4. Misrepresentation by the defendant.
  5. Defects in the defendant's title to the premises.
  6. Entitlement to interest.
  7. Entitlement to damages by the defendant.
  8. Validity and legality of the appropriation of Rs. 1 lakh by the defendant.
  9. Payment of proper court fee by the defendant on the counter-claim.
  10. Entitlement of the defendant to claim interest.
  
  Issue-wise Detailed Analysis:
  
  Issue No. 1:
  The plaintiff's representative, PW I, presented the original power of attorney and minutes book, proving the resolution authorizing him to sign and verify the plaint and institute the suit. The court held that the suit was properly instituted, signed, and verified by a duly authorized person. The issue was decided in favor of the plaintiff.
  
  Issue No. 2:
  The court examined the documents exchanged between the parties to determine if a concluded contract existed. The plaintiff's letter dated August 5, 1983, and the defendant's receipt of Rs. 1 lakh as token money indicated that the lease deed was subject to finalization. The court concluded that the execution of the lease deed was a condition precedent for the contract, and no concluded contract existed between the parties. This issue was decided in favor of the plaintiff.
  
  Issue No. 3:
  The court found that the Rs. 1 lakh was paid as token money and not as advance rent. This amount was to be adjusted against the total advance only if the lease deed was executed. Since no concluded contract existed, the Rs. 1 lakh could not be considered advance rent. The issue was decided against the defendant.
  
  Issue No. 4:
  The court determined that the defendant misrepresented its authority to lease the premises. The defendant failed to disclose its capacity to lease the premises until after receiving the token money. This misrepresentation invalidated any potential contract, allowing the plaintiff to avoid the agreement. The issue was decided in favor of the plaintiff.
  
  Issue No. 5:
  The court noted that the defendant did not have a valid occupancy certificate from the DDA, which was necessary for occupying the premises. However, the absence of an occupancy certificate did not void the contract under the law. Nonetheless, the misrepresentation regarding the defendant's authority to lease the premises vitiated the contract. The issue was decided in favor of the plaintiff.
  
  Issue No. 6:
  The plaintiff was entitled to interest under the Interest Act from the date of the notice (November 17/18, 1983). The court awarded interest at 12% per annum from the date of the notice until realization. The issue was decided in favor of the plaintiff.
  
  Issue No. 7:
  The court found that the defendant did not suffer damages as it was not the owner of the property. The owner, M/s. Pawan Builders Private Limited, suffered any potential damages. Therefore, the defendant was not entitled to recover damages from the plaintiff. The issue was decided against the defendant.
  
  Issue No. 8:
  Since no concluded contract existed, the plaintiff was entitled to recover Rs. 1 lakh, and the defendant was not entitled to retain it. The defendant was bound to refund the amount upon the plaintiff's demand. The issue was decided against the defendant.
  
  Issue No. 9:
  The court held that the defendant was required to pay court fees on the entire counter-claim amount, including the Rs. 1 lakh claimed as adjusted. The defendant was instructed to furnish the court fee within two weeks. The issue was decided against the defendant.
  
  Issue No. 10:
  As the defendant was not entitled to recover damages, it was also not entitled to claim interest. The issue was decided against the defendant.
  
  Relief:
  The court decreed the suit in favor of the plaintiff, awarding Rs. 1 lakh with interest at 12% per annum from September 20, 1983, until realization. The plaintiff was also awarded the costs of the suit. The defendant's counter-claim was dismissed. Suit decreed.

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• 1991 (4) TMI 457
  
  Issues involved: Suit for recovery of debt, non-joinder of necessary party, territorial jurisdiction, time-barred claim, interest calculation, duty to sell pledged goods.
  
  Issue 1 - Competency of the plaintiff's representative:
  The plaintiff's Manager was authorized to file the suit as per a valid Power of Attorney, establishing his competence to represent the plaintiff bank.
  
  Issue 2 - Non-joinder of necessary party:
  The previous Managing Director of the defendant was not a necessary party as he did not incur personal liability for the loan, hence the suit was not defective for non-joinder.
  
  Issue 3 - Time-barred claim and credit facility availed:
  Evidence proved that the defendant availed a cash credit facility of Rs. 2 lakhs and acknowledged the balance due in 1977, within the limitation period, thus the claim was not time-barred.
  
  Issue 4 - Interest calculation and amount due:
  The interest was correctly calculated at 16 1/2 % per annum as per the agreement, and the balance due was established through account statements.
  
  Issue 5 - Duty to sell pledged goods:
  The plaintiff bank was not obligated to sell the pledged goods immediately, as per Section 176 of the Contract Act, which allows the pawnee to retain the goods as collateral security until the debt is cleared. The defendant had the option to request the sale of goods if needed, but no such request was made. The plaintiff's decision to file the suit and retain the goods was legally valid, even if the value of the goods deteriorated over time. The defendant was required to clear the debt before demanding the pledged goods, as per Section 177 of the Contract Act.
  
  Relief:
  The court had territorial jurisdiction, and the suit was decreed in favor of the plaintiff for the recovery of Rs. 3,29,193.61 with interest at 16 1/2 % per annum. The amount realized from the sale of pledged goods was to be adjusted in the decree.

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• 1991 (4) TMI 456
  
  Issues Involved:
  1. Sufficiency of circumstantial evidence to sustain conviction.
  2. Validity of the 'last seen' theory.
  3. Conduct of the accused and false explanation.
  4. Recovery of the dead body on the showing of the accused.
  5. Presence of injuries on the accused's genital and blood stains on his clothes.
  
  Detailed Analysis:
  
  1. Sufficiency of Circumstantial Evidence to Sustain Conviction:
  The Supreme Court emphasized that circumstantial evidence must satisfy three conditions to sustain a conviction:
  - The circumstances must be cogently and firmly established.
  - They should unerringly point towards the guilt of the accused.
  - The circumstances should form a chain so complete that there is no escape from the conclusion that the crime was committed by the accused and none else.
  
  The Court referenced the case of Hanumant v. The State of Madhya Pradesh, highlighting the danger of conjecture or suspicion taking the place of legal proof. The Court must ensure that the chain of evidence is complete and rules out any reasonable likelihood of the innocence of the accused.
  
  2. Validity of the 'Last Seen' Theory:
  The trial court relied on the 'last seen' theory, where the accused was last seen with the deceased. The Supreme Court noted:
  - P.W.1 and P.W.6 testified that the accused took the deceased towards Bombay Chhak to purchase new clothes.
  - P.W.2 saw the accused with a minor girl but did not confirm it was the deceased.
  - The Court found that this evidence was insufficient to conclude that the deceased was last seen in the company of the accused, especially since this circumstance was not noted at the inquest stage.
  
  3. Conduct of the Accused and False Explanation:
  The trial court observed that the accused attempted to flee and gave a false explanation about the whereabouts of the deceased. The Supreme Court noted:
  - The accused's explanation that he sent the girl back in a truck was not implausible.
  - The Court was not convinced that this explanation alone could be deemed false.
  
  4. Recovery of the Dead Body on the Showing of the Accused:
  The trial court relied heavily on the recovery of the dead body on the showing of the accused. The Supreme Court found:
  - P.W.1 and P.W.11's testimonies were inconsistent and contradicted each other.
  - There was no panchnama or mention in the inquest report about the accused showing the place where the body was found.
  - The Court concluded that this crucial circumstance was not established conclusively, creating doubt about the accused showing the place of occurrence.
  
  5. Presence of Injuries on the Accused's Genital and Blood Stains on His Clothes:
  The trial court noted the presence of abrasions on the accused's genital and blood stains on his clothes. The Supreme Court observed:
  - P.W.8, the doctor, found only two pin-head abrasions and no recent sign of sexual intercourse.
  - The accused's explanation for the blood stains (bleeding gums) was plausible.
  - The Court found that this evidence, coupled with the 'last seen' theory, did not amount to legal proof of guilt.
  
  Conclusion:
  The Supreme Court held that the prosecution failed to establish the crucial circumstances conclusively. The evidence presented was insufficient to prove the accused's guilt beyond a reasonable doubt. The Court emphasized the importance of not allowing suspicion to replace legal proof and granted the benefit of doubt to the accused. Consequently, the conviction and sentence were set aside, and the accused was ordered to be released.

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• 1991 (4) TMI 455
  
  Issues Involved:
  1. Validity of the assessment based on the second return filed by the assessee.
  2. Compliance with section 254(3) of the Income-tax Act regarding the communication of the Tribunal's order.
  3. The assessee's entitlement to relief under Article 226 of the Constitution of India.
  4. The appropriateness of the miscellaneous petition under section 254(3) of the Income-tax Act.
  
  Issue-Wise Detailed Analysis:
  
  1. Validity of the assessment based on the second return filed by the assessee:
  The assessee firm challenged the validity of the assessment on the grounds that the second return filed did not fall under section 139(5) of the Income-tax Act and was not a valid return, making the assessment void and without jurisdiction. The Tribunal allowed the appeal in part on 28-9-1984. The High Court, however, declined to grant relief under Article 226, stating that even if the assessment was illegal, the assessee was not entitled to discretionary relief under a writ petition.
  
  2. Compliance with section 254(3) of the Income-tax Act regarding the communication of the Tribunal's order:
  The main contention was whether the communication of the Tribunal's order to the assessee's counsel constituted compliance with section 254(3) of the Income-tax Act. The assessee argued that the counsel was not specifically authorized to receive orders on its behalf, and thus, the Tribunal failed to comply with the mandatory provisions. The Tribunal noted that the vakalat granted to the counsel authorized him to appear and conduct proceedings but did not explicitly include receiving orders. However, the Tribunal found that the counsel's name and address were provided in the memorandum of appeal for communication purposes.
  
  3. The assessee's entitlement to relief under Article 226 of the Constitution of India:
  The High Court held that the assessee was not entitled to relief under Article 226 as the assessment, even if illegal, did not warrant discretionary relief. The High Court also declined the alternative prayer to direct the Tribunal to deliver the order to a competent person on behalf of the assessee, as this was a mixed question of fact and law, not a pure question of law.
  
  4. The appropriateness of the miscellaneous petition under section 254(3) of the Income-tax Act:
  The Tribunal examined whether the miscellaneous petition under section 254(3) was appropriate given that the assessee had already received the order from its counsel. The Tribunal noted that the assessee pursued a writ petition instead of filing a reference application and now sought to fall back on the reference application remedy to circumvent the limitation period. The Tribunal found that the assessee's negligence in seeking the appropriate remedy could not be excused. The Tribunal also distinguished the case from other cited judgments, noting that the facts were not analogous, particularly since the assessee had provided the counsel's address for communication in the memorandum of appeal.
  
  Conclusion:
  The Tribunal concluded that the intent and purpose of section 254(3) were fulfilled as the assessee had received the order through its counsel and had taken further legal action based on that order. The Tribunal dismissed the miscellaneous petition, holding that the provisions of section 254(3) had been complied with and no further action was required.

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• 1991 (4) TMI 454
  
  Issues Involved:
  1. Conviction and sentencing of the accused under Sections 302 and 307 read with Section 34 of the IPC.
  2. Reliability of witness testimonies (PW-3 and PW-4).
  3. Use of the case diary by the defense.
  4. Legality of the sentencing procedure under Section 235(2) of the CrPC.
  
  Issue-wise Detailed Analysis:
  
  1. Conviction and Sentencing of the Accused under Sections 302 and 307 read with Section 34 of the IPC:
  The first accused (A-1) was convicted for causing the deaths of four individuals (D-1 to D-4) and sentenced to death, subject to confirmation by the Supreme Court. Additionally, A-1 was convicted for attempting to murder PW-4 and sentenced to rigorous imprisonment for five years. Accused Sukhdev Singh (A-2) and Sohna Singh (A-3) were convicted for causing the deaths of D-1 to D-4 and sentenced to life imprisonment, and for attempting to murder PW-4, they were sentenced to rigorous imprisonment for five years. The sentences were to run concurrently.
  
  2. Reliability of Witness Testimonies (PW-3 and PW-4):
  The court examined the credibility of PW-3 and PW-4, noting that PW-4, the injured witness, had sustained multiple injuries during the incident. Despite the defense's contention that PW-4 did not disclose the names of the assailants immediately, the court found his testimony credible, especially given his critical condition post-incident. The court also found PW-3's testimony reliable, dismissing the defense's argument that he was a planted witness. The court emphasized that both witnesses had no motive to falsely implicate the accused.
  
  3. Use of the Case Diary by the Defense:
  The court highlighted that the defense's use of the case diary to contradict prosecution evidence was illegal and inadmissible. According to Section 172(3) of the CrPC, the case diary is not to be used as evidence by the accused. The court noted that neither the investigating officers nor the court used the case diary to refresh memory or for contradiction, thus rendering the defense's reliance on it invalid.
  
  4. Legality of the Sentencing Procedure under Section 235(2) of the CrPC:
  The court addressed the procedural issue of sentencing on the same day as the conviction, which contravenes Section 235(2) of the CrPC. This section mandates that the court must provide an opportunity for both the prosecution and the defense to present arguments and evidence on the appropriate sentence. The court referred to previous judgments (Allauddin v. State of M.P. and Anguswamy v. State of Tamil Nadu) to emphasize that sentencing on the same day is not in accordance with the law.
  
  Separate Judgments Delivered:
  The court modified the death sentence of A-1 to life imprisonment, considering that A-1 had already been incarcerated for six years. The conviction and sentence for attempting to murder PW-4 were upheld, and all sentences were directed to run concurrently. A-2 was acquitted of all charges due to insufficient evidence of his participation in the crime. The appeal was allowed to the extent of modifying A-1's sentence and acquitting A-2.

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• 1991 (4) TMI 453
  
  Issues:
  1. Validity of termination of services without an inquiry and opportunity of being heard.
  2. Applicability of relevant rules to the respondent.
  3. Interpretation of Rule 8 of the Madhya Pradesh Government Servants' General Conditions of Service Rules, 1961.
  4. Confirmation of probation and the effect of passing prescribed examinations.
  5. Legal implications of extending the probationary period beyond the specified time frame.
  
  Analysis:
  
  1. The first issue revolves around the validity of the termination of the respondent's services without an inquiry and an opportunity to be heard. The respondent challenged the termination, claiming it violated Rule 9A of the Madhya Pradesh Civil Service Classification Control & Appeal Rules, 1966. The Trial Court and the First Appellate Court dismissed the suit, but the High Court allowed the appeal, decreeing in favor of the respondent. The appellant contended that the termination was valid as the respondent was still a probationer and confirmation was a prerequisite for permanent status. The High Court, however, found that the respondent should be deemed confirmed after the probationary period, and the termination was illegal for lack of due process.
  
  2. The second issue involves determining the relevant rules applicable to the respondent. The Municipal Corporation, under a resolution, adopted Government Rules regulating the conditions of service of officers and servants. The Fundamental Rules, Civil Service Regulations, Government Servants Conduct Rules, and General Book Circulars of the Government of Madhya Pradesh were to apply to the officers and servants of the Municipal Corporation. The High Court's reliance on Rule 14 of the Municipal Officers and Servants Recruitment Rules was deemed incorrect as the previous rules were no longer in force.
  
  3. The interpretation of Rule 8 of the Madhya Pradesh Government Servants' General Conditions of Service Rules, 1961 is crucial in this case. Rule 8 outlines the probationary period for direct recruits, extension possibilities, passing departmental examinations, and confirmation procedures. The rule stipulates that a probationer shall be deemed to continue in service if not confirmed or discharged at the end of the probationary period, subject to termination with a one-month notice. Confirmation is contingent upon successful completion of probation and passing prescribed examinations.
  
  4. The issue of confirmation of probation and the effect of passing prescribed examinations is significant. The respondent's confirmation as a permanent employee was subject to successful completion of probation and passing departmental examinations. The rule explicitly requires an express order of confirmation after the probationary period, and mere expiry of the probation period does not automatically confer confirmation status. In this case, the respondent had not passed all examinations, thus remaining on probation.
  
  5. The legal implications of extending the probationary period beyond the specified time frame are discussed. The power to extend probation is limited by existing rules, and confirmation or discharge from service within a reasonable time after the probationary period is crucial. In cases where rules do not empower extension or confirmation procedures are absent, inaction for an extended period may imply satisfactory completion of probation. However, Rule 8 mandates an order for extension and confirmation, with termination possible after a one-month notice upon probation completion.
  
  In conclusion, the Supreme Court allowed the appeal, setting aside the High Court's judgment and confirming the decisions of the Trial Court and the First Appellate Court. The respondent's termination without an inquiry was deemed valid under Rule 8, as confirmation was pending due to incomplete examinations. The legal principles of confirmation, extension of probation, and termination with notice were key factors in determining the outcome of the case.

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• 1991 (4) TMI 452
  
  Issues Involved:
  The judgment deals with the issue of land acquisition under Sections 17 and 19 of the Bangalore Development Act, 1976, and the applicability of Section 11-A of the Land Acquisition Act, 1894, regarding the time limit for making an award.
  
  Land Acquisition Proceedings:
  The petitioners' lands were acquired by the respondents under the Bangalore Act, with the acquisition process being governed by the Land Acquisition Act. Section 11-A of the Land Acquisition Act, introduced in 1984, mandates that the Collector must make an award within two years from the date of declaration, failing which the proceedings lapse. The petitioners contended that as awards were not made within two years of the notification, the acquisition proceedings had lapsed. The High Court rejected this contention, along with others, in a judgment being challenged before the Supreme Court.
  
  Timeline and Legal Proceedings:
  The notification declaring the acquisition was made on September 20, 1977, and Section 11-A came into force on September 20, 1984. The first proviso to Section 11-A required awards to be made within two years from the commencement of the Amendment Act. The petitioners obtained an interim order from the Supreme Court in 1985, maintaining status quo on possession. Subsequent writ petitions in the Karnataka High Court challenged the acquisition due to awards not being made within the stipulated time. Despite interim stays granted by the High Court, the petitions were dismissed at various levels, leading to the filing of Special Leave Petitions before the Supreme Court.
  
  Suppression of Material Facts:
  The Supreme Court noted that the petitioners failed to disclose the interim stay orders obtained during the legal proceedings, which were crucial in determining the Special Leave Petitions. The Court emphasized that full disclosure of facts is essential when seeking relief under Article 136 of the Constitution. The non-disclosure of material facts, such as the interim orders, was considered as suppression of facts, leading to the dismissal of the Special Leave Petitions.
  
  Conclusion:
  The Supreme Court dismissed the Special Leave Petitions due to the non-disclosure of material facts regarding the interim stay orders, emphasizing the importance of full disclosure in seeking relief. No costs were awarded in relation to the petitions.

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• 1991 (4) TMI 451
  
  Issues Involved:
  1. Locus Standi of the appellants.
  2. Government's power to rescind a notification under the Karnataka Slum Areas (Improvement and Clearance) Act, 1973.
  3. Violation of the principle of natural justice and Article 14 of the Constitution.
  
  Detailed Analysis:
  
  1. Locus Standi of the Appellants:
  The appellants challenged the High Court's decision on their locus standi to contest the notification issued by the Karnataka Government. The High Court had ruled that the appellants lacked locus standi and dismissed their case on these grounds. The Supreme Court, however, disagreed, stating that the first appellant-Association represented the interests of the slum dwellers, and the second appellant was a resident of the area. The Court cited previous rulings, such as Bandhua Mukti Morcha v. Union of India, to affirm that public interest litigation could be initiated by individuals or groups representing those who are socially or economically disadvantaged and unable to approach the Court themselves. The Supreme Court concluded that the High Court was wrong in concluding that the appellants were incompetent to invoke the jurisdiction of the Court.
  
  2. Government's Power to Rescind a Notification:
  The appellants argued that the State Government had no power to rescind the notification issued under Sections 3 and 11 of the Karnataka Slum Areas (Improvement and Clearance) Act, 1973, in the absence of any specific provision in the Act. The Supreme Court referred to Section 21 of the General Clauses Act, which states that the power to issue a notification includes the power to rescind it. The Court cited several precedents, including State of Kerala v. K. G. Madhavan Pillai and Lt. Governor of H.P. v. Sri Avinash Sharma, to support the view that it is always open to the Government to rescind a notification. However, the Court emphasized that the exercise of this power must be in the same manner and subject to the same conditions as the original issuance of the notification.
  
  3. Violation of the Principle of Natural Justice and Article 14:
  The appellants contended that the rescinding of the notification without giving the affected slum dwellers an opportunity to be heard was a violation of the principle of natural justice and Article 14 of the Constitution. The Supreme Court agreed, stating that any action affecting the rights of individuals must be preceded by an opportunity for those affected to be heard. The Court cited Government of Mysore & Ors. v. J.V. Bhat and noted that the objectives of the Karnataka Slum Areas (Improvement and Clearance) Act, 1973, which include improving living conditions for slum dwellers, must be considered. The Court held that the rescinding of the notification without hearing the affected parties was a clear violation of natural justice. Consequently, the impugned notification was quashed, and the Government was directed to proceed only after affording the slum dwellers an opportunity to be heard.
  
  Conclusion:
  The Supreme Court allowed the appeal, set aside the High Court's order, and quashed the impugned notification, emphasizing the need for adherence to the principles of natural justice and the proper exercise of statutory powers. The Court made no order as to costs.

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• 1991 (4) TMI 450
  
  Issues Involved:
  
  1. Legality and validity of the consent given by the Controller of Capital Issues (CCI) for the proposed issue of convertible secured debentures by Larsen and Toubro Ltd.
  2. Legality and validity of the transfer of 39 lakh shares of Larsen & Toubro Ltd. from public financial institutions to Trishna Investments & Leasing Ltd.
  3. Allegations of arbitrary, illegal, mala fide actions and fraud on statutory powers by the respondents.
  4. Whether the actions of the public financial institutions and the CCI were ultra vires of Articles 14 and 39(b) and (c) of the Constitution.
  5. Maintainability of the writ petition as a public interest litigation.
  6. The role and responsibilities of the CCI in ensuring public interest.
  
  Issue-Wise Detailed Analysis:
  
  1. Legality and Validity of the Consent by CCI:
  
  The petitioners challenged the consent given by the CCI for the issue of convertible debentures by L&T, arguing that the consent was given without proper application of mind and in undue haste. The court examined the sequence of events and the manner in which the consent was granted. It was noted that the application by L&T was made on 26-7-89, and the consent was given on 29-8-89, refuting the claim of undue haste. The court also considered that the CCI had a role to play in ensuring that public interest does not suffer as a consequence of the consent granted. The court concluded that the consent given by the CCI was valid and in accordance with the provisions of the Capital Issues (Control) Act, 1947.
  
  2. Legality and Validity of the Transfer of Shares:
  
  The petitioners alleged that the transfer of 39 lakh shares of L&T from public financial institutions to Trishna Investments through BOB Fiscal Services Ltd. was arbitrary, illegal, mala fide, and a fraud on statutory powers. The court examined the sequence of events and the manner in which the shares were transferred. It was noted that BOB Fiscal Services Ltd. acted as a conduit for funneling shares from public financial institutions to the Ambani group. The court observed that the public financial institutions should be prudent and cautious in transferring equity shares and should consider public interest. However, since the financial institutions had already bought back the 39 lakh shares from Trishna Investments, the court did not find it necessary to dilate on this point further.
  
  3. Allegations of Arbitrary, Illegal, Mala Fide Actions and Fraud:
  
  The petitioners contended that the actions of the public financial institutions and the CCI were arbitrary, illegal, mala fide, and a fraud on statutory powers. The court examined the allegations and found that the transfer of shares and the consent given by the CCI were done following business principles and in public interest. The court noted that the public financial institutions acted to earn profit and recycle funds for investing in other businesses in public interest. The court dismissed the allegations of fraud and mala fide actions.
  
  4. Ultra Vires of Articles 14 and 39(b) and (c) of the Constitution:
  
  The petitioners argued that the actions of the respondents were ultra vires of Articles 14 and 39(b) and (c) of the Constitution. The court examined the actions of the public financial institutions and the CCI in light of these constitutional provisions. The court observed that the CCI has a role to play in ensuring that public interest does not suffer and that the ownership and control of material resources are distributed to subserve the common good. The court concluded that the actions of the respondents were not ultra vires of the constitutional provisions.
  
  5. Maintainability of the Writ Petition as a Public Interest Litigation:
  
  The respondents challenged the maintainability of the writ petition as a public interest litigation. The court referred to previous decisions and observed that the petition was maintainable as a public interest litigation. The court noted that the issues raised in the petition were of far-reaching impact on public duty and public obligations of the government and its instrumentalities.
  
  6. Role and Responsibilities of the CCI:
  
  The court examined the role and responsibilities of the CCI in ensuring public interest. The court referred to the decision in N. K. Maheshwari v. Union of India, where it was observed that the CCI has a role to play in ensuring that public interest does not suffer as a consequence of the consent granted. The court concluded that the CCI acted within its powers and responsibilities in granting consent for the issue of convertible debentures by L&T.
  
  Conclusion:
  
  The court dismissed the transferred cases and the contempt petitions, upholding the validity of the consent given by the CCI and the actions of the public financial institutions. The court emphasized the need for public financial institutions to act prudently and consider public interest in transferring equity shares. The court also highlighted the responsibilities of the CCI in ensuring that public interest does not suffer as a consequence of the consent granted.

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