Input:
minal Appeal No. 218 of 1966.
Appeal by special leave from the order dated August 5, 1966 of the Patna High Court in Criminal Revision No. 1020 of 966, AND Criminal Appeal No. 238 of 1966.
Appeal by special leave from the judgment and order dated September 13, 1966 of the Patna High Court in Criminal Revi sion No. 40 of 1965.
B. P. Jha and Subhag Mal Jain, for the appellants (in Cr. A. No. 218 of 1966).
Nuruddin Ahmed and R. C. Prasad, for the appellants (in Cr. A. No. 238 of 1966).
U. P. Singh, for the respondents (in both the appeals).
The Judgment of the Court was delivered by Vaidialingam, J.
The common question, that arises for con sideration, in these two criminal appeals, by special leave, is as to whether a Magistrate can direct the police to submit a charge sheet, when the police, after the investigation into a congnizable offence, had submitted a final report, under section 173 of the Code of.
Criminal Procedure (hereinafter called the Code).
There is a conflict of opinion, on this point between the various High Courts in India.
The High Courts of Madras, Calcutta, Madhya Pradesh, Assam and Gujarat have taken the view that the Magistrate has no such power, whereas, the Patna and Bombay High Courts have held a contrary view.
In Criminal Appeal No. 218 of 1966, the respondent, Dinesh Mishra, lodged a first information report, on June 3, 670 1965, at the Rajoun Police Station, that he saw a thatched house, of one Uma Kant Misra, situated on the northern side of his house, burning, and the petitioners herein., running away from the scene,.
The police made an investigation and submitted what is called a 'final report ', under section 173 (1) of the Code, to the effect that the offence complained of, was false.
The Sub Divisional Magistrate received this report on July 13, 1965, but, in the meanwhile, the respondent had filed what is termed 'a protest petition ', challenging the correctness of the report submitted by the police.
The Magistrate appears to have perused the police diary and, after hearing the counsel for the respondent and the public prosecutor, passed an order on October 27, 1965, directing the police to submit a charge sheet, against the petitioners, herein.
The petitioners challenged this order, without success, both before the learned Sessions Judge, Bhagalpur, and the Patna High Court.
It was held by the High Court, following its previous decision, that the Magistrate has jurisdiction to call for a charge sheet, when he disagrees with the report submitted by the police, under section 173(1) of the Code.
The petitioners, in this appeal, challenge these orders.
Similarly, in Criminal Appeal No. 238 of 1966, the second respondent therein, had lodged a written report, on February 24.
1.964, before the police, at Malsalami police station, that his daughter, Hiramani, was missing from February 21, 1964, and that the appellants in that appeal, had kidnapped her.
A case under section 366 I.P.C. was registered against them.
The police, after investigation, submitted a final report to the Magistrate.
to the effect that the girl concerned, had been recovered and that she bad stated that she had, of her own accord, eloped; and therefore the police stated that the case might be treated as closed.
The second respondent filed a 'protest petition ' in Court, challenging the statements of the police and he also filed a complaint, under section 498 I.P.C.
The Magistrate, after a perusal of the case diary of the police, and hearing the lawyer for the appellants and the second respondent, as also the public prosecutor, passed an order directing the investigating officer to submit a charge sheet, against the accused persons, under section 366 I.P.C This order has been confirmed by the, learned Sessions Judge, as well as the Patna High Court.
Here also, the Patna High Court, in accordance with its previous decision, held that the Magistrate had jurisdiction to pass the order, in question.
All these orders are challenged by the appellants, in this appeal.
On behalf of the appellants, in Criminal Appeal No. 218 of 1966, Mr. Jha, learned counsel pointed out that when a final report is submitted by the police, under section 173(1) of the Code,, 6 71 stating that no case is made out, the Magistrate has no jurisdiction to direct the police to file a charge sheet.
It may be open, counsel points out, to the Magistrate, to direct further investigation to be made by the police, or to treat the protest petition filed by the second respondent, as a complaint, and take cognizance of the offence and proceed, according to law.
, The scheme of Chapter XIV of the Code, counsel points out, clearly indicates that the formation of an opinion, as to whether or not there is a case to place the accused on trial, is that of the investigating officers, and the Magistrate cannot compel the police to form a particular opinion on the 'investigation and to submit a report, according to such opinion.
In this case, there is nothing to show that the protest petition, filed by the second respondent, has befell treated as a complaint, in which case, it may be open to the Magistrate to take cognizance of the offence, but, in the absence of any such procedure being adopted according to counsel, the order of the Magistrate directing a charge sheet to be filed, is illegal and not warranted by the provisions of the Code.
These contentions have been adopted, and reiterated, by Mr. Nuruddin Ahmed, on behalf of the appellants, in Criminal Appeal No. 238 of 1966.
Both the learned counsel pressed before us, for acceptance, the views, as expressed by the Gujarat High Court, in its Full Bench judgment, reported as State of Gujarat vs Shah Lakhamshi(1).
On the, other hand, Mr. U. P. Singh, learned counsel for the respondent, in Criminal Appeal No. 218 of 1966, has pointed out that the Magistrate has jurisdiction, in proper cases, when he does not agree with the final report submitted by the police, to direct them to submit a charge sheet.
Otherwise, counsel points out, the position will be that the entire matter is left to the discretion of the police authorities, and the Courts will be powerless, even when 'they feel that the action of the police is not justified.
Quite naturally, counsel prays for acceptance of the views expressed by the dissenting Judges, in A. K. Roy vs State of W. B. (2) and by the Bombay and Patna High Courts, in the decisions reported as State vs Murlidhar Govardhan(3), and Ram Nandan vs State ( 4 ) , respectively.
In order, properly, to appreciate the duties of the police, in the matter of 'investigation of offences, as well as their powers, it is necessary to refer to the provisions contained in Chapter XIV of the Code.
That chapter deals with 'Information to the Police and their Powers to investigate ', and it contains the group of section beginning from section 154 and ending with section 176.
Section 154 deals with information relating to the commission of a cognizable R. 1966 Guj, 283.
(2) A. 1.
R. B.).
(3) A. 1.
R. (4) A. 1.
R. 1966 Pat.
67 2 offence, and the procedure to be adopted in respect of the same.
Section 155, similarly, deals with information in respect of noncognizable offences.
Sub section
(2), of this section, prohibits a police officer from investigating a non cognizable case, without the order of a Magistrate.
Section 156 authorizes a police officer, in charge of a police station, to investigate any cognizable case, without the order of a Magistrate.
Therefore, it wilt be seen that large powers are conferred on the police, in the matter of investigation into a cognizable offence.
Sub section
(3), of section 156, provides for any Magistrate empowered under section 190, to order an investigation.
In cases where a cognizable offence is suspected to have been committed, the officer, in charge of a police station, after sending a report to the Magistrate, is entitled, under section 157, to investigate the facts and circumstances of the case and also to take steps for the discovery and arrest of the offender.
Clause (b), of the proviso to section 157(1), gives a discretion to the police officer not to investigate the case, if it appears to him that there is no sufficient ground for entering on an investigation.
Section 158 deals with the procedure to be adopted in the matter of"a report to be sent, under section 157.
Section 159 gives power to a Magistrate, on receiving a report under section 157, either to direct an investigation or, himself or through another Magistrate subordinate to him, to hold a preliminary enquiry into the matter, or otherwise dispose of the case, in accordance with the Code.
Sections 160 to 163 deal with the power of the police to require attendance of witnesses, examine witnesses and record statements.
Sections 165 and 166 deal with the power of police officers, in the matter of conducting searches, during an investigation, in the circumstances, mentioned therein.
Section 167 provides for the procedure to be adopted by the police, when investigation cannot be completed in 24 hours.
Section 168 provides for a report being sent to the officer, incharge of a police station, about the result of an investigation, when such investigation has been made by a subordinate police officer, under Chapter XIV.
Section 169 authorises a police officer to release a person from custody, on his executing a bond, to appear, if and when so required, before a Magistrate, in cases when, on investigation under Chapter XIV, it appears to the officer, in charge of the police station, or to the police officer making the investigation, that there is no sufficient evidence or reasonable ground of suspicion, to justify the forwarding of the accused to a Magistrate.
Section 170 empowers the officer, incharge of a police station, after investigation under Chapter XIV, and if it appears to him that there is sufficient evidence, to forward the accused, under custody, to a competent Magistrate or to take securtiy from the accused for his appearance before the Magistrate, in cases where the offence is bailable.
Section 172 makes it obligatory on the police officer making an investigation, to maintain a diary recording the various particulars therein and in the 673 manner indicated in that section.
Section 173 provides for an investigation, under Chapter XIV, to be completed, without unnecessary delay and also makes it obligatory, on the officer, incharge of the police station, to send a report to the Magistrate concerned, in the manner provided for therein, containing the necessary particulars.
It is now only necessary to refer to section 190, occurring in Chapter XV, relating to jurisdiction of criminal Courts in inquiries and trials.
That section is to be found under the heading 'Conditions requisite for initiation of proceedings ' and its sub section (1) is as follows : "(1) Except as hereinafter provided, any Presidency Magistrate, District Magistrate or Sub divisional Magistrate and any other Magistrate specially empowered in this behalf, may take cognizance of any offence (a) upon receiving a complaint of facts which constitute such offence; (b) upon a report in writing of such facts made, by any police officer; (c) upon information received from any person other than a police officer, or upon his own knowledge or suspicion, that such offence has been committed.
" From the foregoing sections, occurring in Chapter XIV, it will be seen that very elaborate provisions have been made for securing that an investigation does take place into a reported offence and the investigation is carried out within the limits of the law, without causing any harassment to the accused and is also completed without unnecessary or undue delay.
But the point to be noted is that the manner and method of conducting the investigation, are left entirely to the police, and the Magistrate, so far as we can see, has no power under any of these provisions, to interfere with the same.
If, on investigation, it appears to the officer, in charge of a police station, or to the officer making an investigation, that ,,here is no sufficient evidence or reasonable grounds of suspicion justifying the forwarding of an accused to a Magistrate,, section 169 says that the officer shall release the accused, if in custody, on hi , executing a bond to appear before the Magistrate.
Similarly, if on the other hand, it appears to the officer, in charge of a police station, or to the officer making the investigation, under Chapter XIV, that there is sufficient evidence or reasonable ground to justify the forwarding of an accused to a Magistrate, such an officer is required, under section 170, to forward the accused to a Magistrate or, if the offence is bailable, to take security from him for his appearance before such Magistrate.
But, whether a case comes under section 169, or under section 170, of the Code, on the completion of the investigation, the police officer has to L7SupCI/67 13 674 submit a report to the Magistrate, under section 173, in the manner indicated therein, containing the various details.
The question as to whether the Magistrate has got power to direct the police to file a charge sheet, on receipt of a report under section 173 really depends upon the nature of the jurisdiction exercised by a Magistrate, on receiving a report.
In this connection, we may refer to certain observations, made by the Judicial Committee in King Emperor vs Khwaja Nazir Ahmed(1) and by this Court, in H. N. Rishbud and Inder Singh vs The State of Delhi(2).
In Nazir Ahmed 's Case(1), Lord Porter observes, at 212, as follows "Just as it is essential that every one accused of a crime should have free access to a court of justice so that he may be duly acquitted if found not guilty of the offence with which he is charged, so it is, of the utmost importance that the judiciary should not interfere with the police in matters which are within their province and into which the law imposes on them the duty of inquiry.
In India, as has been shown, there is a statutory right on the part of the police to investigate the circumstances of an alleged cognizable crime without requiring any authority from the judicial authorities, and it would, as their Lordships think, be an unfortunate result if it should be held possible to interfere with those statutory rights by an exercise of the inherent jurisdiction of the court.
The functions of the judiciary and the police are complementary, not overlapping, and the combination of individual liberty with a due observance of law and order is only to be obtained by leaving each to exercise its own function, always, of course, subject to the right of the court to intervene in an appropriate case when moved under section 491 of the Criminal Procedure Code to give directions in the nature of habeas corpus.
In such a case as the present, however, the court 's functions begin when a charge is preferred before it, and not until then.
" These observations have been quoted, with approval, by this Court, in State of West Bengal vs section N. Basak(3).
This Court in Rishbud and Inder Singh 's Case(1), observes, at p. 1156, as follows : "Investigation usually starts on information relating to the commission of an offence given to an officer incharge of a police station and recorded under sec (1) L. R. 71 1.
A. 203.
(2) (3) A. 1.
R. 675 tion 154 of the Code.
If from information so received or otherwise, the officer in charge of the police station has reason to suspect the commission of an offence, he or some other subordinate officer deputed by him, has to proceed to the spot to investigate the facts and circumstances of the case and if necessary to take measures for the discovery and arrest of the offender.
Thus investigation primarily consists in the ascertainment or the facts and circumstances of the case.
By definition, it includes 'all the proceedings under the Code for the collection of evidence conducted by a police officer '.
" Again after a reference to some of the provisions in Chapter XIV of the Code, it is observed at p. 1157 "Thus, under the Code investigation consists generally of the following steps : (1) Proceeding to the spot, (2) Ascertainment of the facts and circumstances of the case, (3) Discovery and arrest of the suspected offender, (4) Collection of evidence relating to the commission of the offence which may consist of (a) the examination of various persons (including the accused) and the reduction of their statements into writing, if ' the officer thinks fit, (b) the search of places of seizure of things considered necessary for the investigation and to be produced at the trial, and (5) Formation of the opinion as to whether on the material collected there is a case to place the accused before a Magistrate for trial and if so taking the necessary steps for the same by filing of a charge sheet under section 1 7 3. .
It is also clear that the final step in the investigation viz., the formation of the opinion as to whether or no ' there is a case to place the accused on trial is to be that of the officer in charge of the police station.
" We are referring to these observations for the purpose of emphasizing that the scheme of Chapter XIV, clearly shows that the formation of an opinion as to whether or not there is a case to place the accused on trial, has been left to the officer incharge of a police station.
Bearing in mind these principles referred to above, we have to consider the question that arises for consideration, in this case.
The High Courts which have held that the Magistrate has no jurisdiction to call upon the police to file a charge sheet, under such circumstances, have Tested their decision on two principles viz., (a) that there is no express provision in the Code empowering a Magistrate to pass such an order; and (b) such a power, in view of the scheme of L7SUPCI/67 14 676 Chapter XIV, cannot be inferred vide Venkata Subha v Anjanayulu(1); Abdul Rahim vs Abdul Muktadin(2); Aman Premanand vs State(3); the majority view in A. K. Roy vs State of W. B.(1); and Stale of Gujarat vs Shah Lakhamshi(5).
Or the other hand, the High Courts which have recognised such a power, rest their decision again on two grounds viz., (a) where a report is submitted by the police, after investigation, the Magistrate has to deal with it judicially, which will mean that where the report is not accepted, the Magistrate can give suitable directions to the police , and (b) the Magistrate is given supervision over the conduct of investigation by the police, and there ore, such a power can be recognised in the Magistrate vide State vs Murlidhar Goverdhan(6); and Ram Nandan vs State(7).
Though it may be that a report submitted by the police may have to be dealt with, judicially, by a Magistrate, and although the Magistrate may have certain supervisory powers, nevertheless, we are not inclined to agree with the further view that from these considerations alone it can be said that when the police submit a report that no case has been made out for sending up an accused for trial, it is open to the Magistrate to direct the police to file a charge sheet.
But, we may make it clear, that this is not to say that the Magistrate is absolutely powerless, because, as will be indicated later, it is open to him lo take cognizance of an offence and proceed, according to law.
We do not also find any such power, under section 173(3), as is sought to be inferred, in some of the decisions cited above.
As we have indicated broadly the, approach made by the various High Courts in coming to different conclusions, we do not think it necessary to refer to those decisions in detail.
It will be seen that the Code, as such, does not use the ex pression 'charge sheet ' or 'final report '.
But it is understood, in the Police Manual containing Rules and Regulations, that a report by the Police, filed under section 170 of the Code, is referred to as a 'charge sheet '.
But in respect of the reports sent under section 169, i.e., when there is no sufficient evidence to justify the forwarding of the accused to a Magistrate, it is termed variously, in different States, as either 'referred charge ', 'final report ', or 'Summary '.
In these two appeals, which are from the State of Bihar, the reports, under section 169, are referred to as 'final report '.
Now, the question as to what exactly is to be done by a Magistrate, on receiving a report.
under section 173, will have to be considered.
That report may be inrespect of a case, coming under section 170, (1) A.I.R. 1932 Mad. 673.
(2) A.I.R. 1953 Assam 112.
(3) A.I.R. 1960 M P. 12.
(4) A.I.R. 1962 Cal.
(5) A.I.R. 1966 Guj.
(6) A.I.R. 1960 Born.
(7) A.I.R. 1966 Pat.
677 or one coming under section 169.
We have already referred to section 190, which is the first section in the group of sections headed 'Conditions requisite for Initiation of Proceedings. ' Sub section
(1), of this section, will cover a report sent, under section 173.
The use of the words 'may take cognizance of any offence ', in sub section
(1) of section 190 in our opinion imports the exercise of a 'judicial discretion ', and the Magistrate, who receives the report, under section 173, will have to consider the said report and judicially take a decision, whether or not to take cognizance of the offence.
From this it follows that it is not as if that the Magistrate is bound to accept ,,the opinion of the police that there is a case for placing the accused, on trial.
It is open to the Magistrate to take the view that the facts disclosed in the report do not make out an offence for taking cognizance or he may take the view that there is no sufficient evidence to justify an accused being put on trial.
On either of these grounds, the Magistrate will be perfectly justified in declining to take cognizance of an offence, irrespective of the opinion of the police.
On the other hand, if the Magistrate agrees with the report, which is a charge sheet submitted by the police, no difficulty whatsoever is caused, because he will have full jurisdiction to take cognizance of the offence, under section 190(1)(b) of the Code.
This will be the position, when the report under section 173, is a charge sheet.
Then the question is, what is the position, when the Magis trate is dealing with a report submitted by the police, under section 173, that no case is made out for sending up an accused for trial, which report, as we have already indicated, is called, in the area in question, as a 'final report '? Even in those cases, if the Magistrate agrees with the said report, he may accept the final report and close the proceedings.
But there may be instances when the Magistrate may take the view, on a consideration of the final report, that the opinion formed by the police is not based on a full and complete investigation, in which case in our opinion the Magistrate will have ample jurisdiction to give directions to the police, under section 1 5 6 ( 3 ), to make a further investigation.
That is, if the Magistrate feels, after considering the final report, that the investigation is unsatisfactory, or incomplete, or that there is scope for further investigation, it will be open to the Magistrate to decline to accept the final report and direct the police to make further investigation, under section 156(3).
The police, after such further investigation, may submit a charge sheet, or,, again submit a final report, depending upon the further investigation made by them.
If, ultimately, the Magistrate forms the opinion that the facts, set out in the final report, constitute an offence, he, can take cognizance of the offence under section 190(1) (c), notwithstanding the contrary opinion of the police, expressed in the final report.
678 In this connection, the provisions of section 169 of the Code, are relevant.
They specifically provide that even though, on investigation, a police officer, or other investigating officer, is of the opinion that there is no case for proceeding against the accused, he is bound, While releasing the accused,, to take a bond from him to appear, 'If and.
when required, before a Magistrate.
This provision is obviously to meet a contingency of the Magistrate, when he considers the report of the investigating officer, and judicially takes a view different from the police.
We have to approach the, question, arising for consideration in this case, in the light of the circumstances pointed out above.
We have, already referred to the scheme of Chapter XXIV, as well as the observations of this Court in Rishbud and Inder Singh 's Case(1) that the formation of the opinion as to whether or not there is a case to place the accused on trial before a Magistrate, is 'left to the officer in charge of the police station.
There is no express power, so far as we can see, which gives jurisdiction to pass an order of the nature under attack; nor can any such powers be implied.
There is certainly no obligation, on the Magistrate, to accept the report, if he does not agree with the opinion formed by the police.
Under those circumstances, if he still suspects that an offence has been committed, he is entitled, notwithstanding the opinion of tile police, to take cognizance, under section 190(1)(c) of the Code.
That provision, in our opinion, is obviously intended to secure that offences may not go unpunished and justice may be in voked even where persons individually aggrieved are unwilling or unable to prosecute.
or the police, either wantonly or through bona fide error, fail to submit a report, setting out the facts constituting the offence.
Therefore, a very wide power is conferred on the Magistrate to take cognizance of an offence.
not only when he receives information about the commission of an offence from a third person, but also where he has knowledge or even suspicion that the offence has been committed.
It is open to the Magistrate to take cognizance of the offence, under section 190(1) (c), on the ground that, after having due regard to the final report and the police records placed before him, be has reason to suspect that an offence has been committed.
Therefore, these circumstances will also clearly negative the power of a Magistrate to call for a charge sheet from the police, when they have submitted a final report.
The entire scheme of Chapter XIV clearly indicates that the formation of the opinion, as to whether or not there is a case to, place the accused for trial, is that of the officer in charge of the police station and that opinion determines whether the report is to be under section 170, being a 'charge sheet ', or under section 169, 'a final report '.
It is no (1) [1955]1 S.C.R. 1150.
67 9 doubt open to the Magistrate, as we have already pointed out, to accept or disagree with the opinion of the police and, if he disagrees, he is entitled to adopt any one of the courses indicated by us.
But he cannot direct the police to submit a charge sheet, because, the submission of the report depends upon the opinion formed by the police, and not on the opinion of the Magistrate.
The Magistrate cannot compel the police to form a particular opinion, on the investigation, and to submit a report, according to such opinion.
Thai will be really encroaching on the sphere of the police and compelling the police to form an opinion so as to accord with the decision of the Magistrate and send a report, either under section 169, or under section 170, depending upon the nature of the decision.
Such a function has been left to the police, under the Code.
We have already pointed out that the investigation, under the Code, takes in several aspects, and stages, ending ultimately with the formation of an opinion by the police as to whether, on the material covered and collected, a case is made out to place the accused before the Magistrate for trial, and the submission of either a charge sheet, or a final report is dependent on the nature of the opinion, so formed.
The formation of ,the said opinion, by the police, as pointed out earlier, is the final step in the investigation, and that final step is to be taken only by the police and by no other authority.
The question can also be consider from another point of view.
Supposing the police send a report, viz., a charge sheet, under section 170 of the Code.
As we have already pointed out, the Magistrate is not bound to accept that report, when he considers the matter judicially.
But, can he differ from the police.
and call upon them to submit a final report, under s.169 ? In our opinion, the Magistrate has no such power.
If he has no such power, in law, it also follows that the Magistrate has no power to direct the police to submit a charge sheet when the police have submitted a final report that no case is made out for sending the accused for trial.
The functions of the Magistracy and the police, are entirely different, and though, in the circumstances mentioned earlier the Magistrate may or may not accept the report, and take suitable action, according to law, he cannot certainly infringe upon the jurisdiction of the police, by compelling them to change their opinion, so as to accord with his view.
Therefore, to conclude, there is no power, expressly or im pliedly conferred, under the Code, on a Magistrate to call upon the police to submit a charge sheet, when they have sent a report under section 169 of the Code, that there is no case made out for sending tip an accused for trial.
L7 Sup.
CI/67 15 680 In these two appeals, one other fact will have to be taken note of.
It is not very clear as to whether the Magistrate, in each of these cases, has chosen to treat the protest petitions, filed by the respective respondents, as complaints, because, we do not find that the Magistrate has adopted the suitable procedure indicated in the Code, when he takes cognizance of an offence, on a complaint made to him.
Therefore, while holding that the orders of the Magistrate, in each of these cases, directing the police to file charge sheets, is Without jurisdiction, we make it clear that it is open to the Magistrate to treat the respective protest petitions, as complaints, and take further proceedings, according to law, and in the light of the views expressed by us, in this judgment.
Mr. Nuruddin Ahmed, learned counsel for the appellants in Criminal Appeal No. 238 of 1966, particularly urged that it is unnecessary to direct further proceedings to be continued, so far as his clients are concerned.
Learned counsel pointed out that the police report before the Magistrate clearly shows that the girl, in question, who is stated to be above 19 years of age, has herself stated that she bad eloped, of her own accord and that if that is so, further proceedings against his clients, are absolutely unnecessary, to be continued.
We are not inclined to accept these contentions of the learned counsel.
As to whether an offence is made out or whether any of the appellants or both of them are guilty of the offences with which they may be charged, are all matters which do not require to be considered, by this Court, at this stage.
In the result, subject to the directions contained above, the orders of the Magistrate, directing the police to file a charge, will be set aside, and the appeals allowed, to that extent.
V.P.S. Appeals allowed.

Output:
On the question whether a magistrate could direct the police to submit a charge sheet, when the police, after investigation into a cognizable offence, had submitted a report of the action taken under section 169, Cr. P.C., that there was no case made out for sending up the accused for trial, HELD : There was no such power conferred on a magistrate either expressly or by implication.
When a cognizable offence is reported to the police they may after investigation take action under section 169 or section 170 Cr.
If the police :think there is not sufficient evidence against the accused, they may, under section 169 release the accused from custody on his executing a bond to appear before a competent magistrate if and when so required; or, if the police think there is sufficient evidence, they may, under section 170, forward the accused under custody to a competent magistrate or release the accused on bail in cases where the offences are bailable.
In either case the police should submit a report of the action taken, under section 173, to the competent magistrate who considers it judicially under section 190 and takes the following action : (1) If the report is a charge sheet under section 170 it is open to the magistrate to agree with it and take cognizance of the offence under section 190(1) (b); or to take the view that the facts disclosed do not make out an offence and decline to take cognizance.
But he cannot call upon the police to submit a report that the accused need not be proceeded against on the ground that there was not sufficient evidence.
(2) If the report is of the action taken under section 169, then the magistrate may agree with the report and close the proceeding.
If he disagrees with the report he can give directions to the police under section 156(3) to make a further investigation.
If the police, after further investigation submit a charge sheet, the magistrate may follow the procedure where the charge sheet under section 170 is filed; but if the police are still of the opinion that there was not sufficient evidence against the accused, the magistrate may agree or disagree with it.
Where he agrees, the case against the accused is closed.
Where the magistrate disagrees and forms the opinion that the facts set out in the report constitute an offence, he .can take cognizance under section 190(1)(c).
The provision in section 169 enabling the Police to take a bond for the appearance of the accused before a magistrate if so required, is to meet such a contingency of the magistrate taking cognizance of the offence notwithstanding the contrary opinion of the police.
The power under section 190(1)(c) was intended to Secure that 66 9 offences may not go unpunished and justice may be invoked even where persons individually aggrieved are unwilling or unable to prosecute, or he police either wantonly or through a bona, fide error do not submit a charge sheet.
But the magistrate cannot direct the Police to submit a charge sheet, because the submission of the report depends entirely upon the opinion formed by the police and not on the opinion of the magistrate.
The magistrate, if he disagrees with the report of the police, can.
himself take cognizance of the offence under section 19O(1)(a) or (c), but, be cannot compel the police to form a particular opinion on investigation and submit a report according to such opinion.
[672F H; 673B; 676H; 677B H; 678 A H; 679A C. E H] State of Gujarat vs Shah Lakhamshi, A.I.R. 1966 Gujarat 283 (F.B.); Venkatusubha vs Anjanayulu, A.I.R. 1932 Mad. 673; Abdul Rahim vs Abdul Muktadin, A.I.R. 1953 Assam 112; Amar Premanand vs State, A.I.R. 1960 M.P. 12 and A. K. Roy vs State of West Bengal, A.I.R. 1962 Cal.
135 (F.B.), approved.
State vs Murlidhar Govardhan, A.I.R. 1960 Bom.
240 and Ram Wandan vs State, A.I.R. 1966 Pat.
438, disapproved.


Input:
Civil Appeal No. 2603 2605 of 1987.
From the Judgment and order dated 8.12.1986 of the Rajasthan High Court in D.B. Special Appeal No. 889, 975 and 1135 of 1986.
G.L. Sanghi and Mrs. Rani Chhabra for the Appellants.
Shanti Bhushan and S.K. Jain for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN, J.
Special Leave granted.
Appeals are disposed of by this order.
The three appellants had been granted permits on a route from Bhadra to Hissar via Adampur.
This route lay both in the State of Rajasthan and in the State of Haryana and was thus an inter State route.
When the permits were about to expire the petitioners filed applications for their renewal in accordance with the provisions of section 58 of the Motor Vehicles Act (hereinafter called 'the Act ').
At the same time, the Rajasthan State Road Transport Corporation (hereinafter referred to as 'the Corporation ') also moved applications before the Regional Transport Authority, Bikaner, for the grant of fresh permits to it on the same route.
The applications for renewal of permits made by the petitioners as well as the applications for the grant of permits by the Corporation were heard together by the Re gional Transport Authority, Bikaner (R.T.A.) on several dates, the 643 last of which was the 6th of November, 1981.
On that date, orders were reserved by the R.T.A. The R.T.A., however, passed its order only on 27th November, 1982, about a year after the date of the hearing.
It rejected the renewal applications of the petitioners and granted permits to the Corporation in respect of the above route.
Aggrieved by the orders of the R.T.A., the petitioners filed appeals before the State Transport Appellate Tribunal (S.T.A.T.) The STAT dismissed the appeals preferred by the petitioners and confirmed the order of the R.T.A. The petitioners filed writ petitions in the High Court of Rajasthan, which were dismissed by a Single Judge on 2 1st July, 1986.
Further appeals preferred by the petitioners and certain other operators were dismissed by a Division Bench of the High Court of Rajasthan by its judgment and order dated 8th December, 1986.
These Special Leave Petitions have been preferred against the order of the Division Bench dated 8th December, 1986.
We have come to the conclusion that the order of the R.T.A. (and consequently the orders of the STAT and the High Court) should be set aside and the matter should be remitted back to the R.T.A. for fresh consideration on the short ground that the petitioners have not had a fair opportunity of putting forward and being heard on their contentions relevant to the issue before the R.T.A. The principal issue that had to be considered by the R.T.A. was whether the claims of the Corporation for the grant of a permit had precedence over the claims of the petitioners for renewal.
This issue had to be decided in the context of two statutory provisions.
The first is section 47( 1H) of the Act which reads as follows: Notwithstanding anything contained in this section, an application for a stage carriage permit from a State transport undertaking for operating in any inter State route shall be given preference over all other applications: Provided that the authority shall not grant a permit under this sub section unless it is satisfied that the State transport undertaking would be able to operate in the inter State route without detriment to its responsibility for providing efficient and adequate road transport service in any notified area or notified route as is referred to in subsection (3) of section 68D where the undertaking operates the service.
644 Explanation For the purposes of this sub section, "inter State route" means any route lying contiguously in two or more States.
The second relevant provision is the third proviso inserted in section 58(2) of the Act by an amendment applicable to the State of Rajasthan.
This sub section, in so far it is material for our present purposes, reads: . "(2) A permit may be renewed on an application made and disposed of as if it were an application for a permit: Provided further that, other conditions being equal, an application for stage carriage permit by a State transport undertaking as defined in section 68(A), shall be given preference over applications from individual owners and cooperative societies.
" The arguments before the R.T.A. primarily ranged round the question whether the terms of the proviso to section 47(1H) were fulfilled in the present case or not.
The petitioners (as well as operators on several other routes whose requests for renewal had also been countered by applications for permits by the Corporation) con tended that the Corporation was not in a position to operate in the inter State routes in question without detriment to its responsibility for providing efficient and adequate road transport service in routes which had already been nationalized under Chapter IV A of the Act.
The R.T.A. has applied its mind to this contention in what may be described as a piecemeal manner.
This was because applications made by several private operators and the corporation in regard to various routes came up for consideration by it in separate meetings held at different places on different occasions.
In fact it is this which also explains the delay in the passing of its order by the R.T.A. in the present case.
In course of the hearing before us, we called upon the respondents to produce the original records.
These show that the mat ter relating to renewal of permits of six operators (including the preG sent petitioners) was heard on 6.11.1981 and orders reserved.
On 30 .11.8 1, the counsel for the Corporation made a request to the R.T.A. that certain other matters pertaining to renewals of permits in the Bikaner region were coming up for consideration on 16.12.81 and that, therefore, the orders in the instant cases may be deferred till after the other matters were also heard by the R.T.A. This request of the counsel for the Corporation was accepted by the R.T.A. The other 645 matters referred to could not be heard on 16.12.1981 but got adjourned from time to time.
The order sheet of the R.T.A. in the present case shows that the decision in the present cases was deferred on three subsequent occasions upto 22.03.1982.
The records do not indicate what happened thereafter but it appears that the decision was postponed on subsequent occasions also for the same reason and ultimately announced by the R.T.A. On the 27th of November, 1982, after the connected matters had been heard.
This is clear from the order of the R.T.A. which, in arriving at its final decision, has followed the orders passed by it on 15.9.82 & 24.11.82 in certain other matters and the orders passed by the R.T.A., Jaipur on 7.4.82 & 10.9.82 in relation to two routes falling within its jurisdiction.
The short grievance of the petitioners was that, by adopting the above procedure, the R.T.A. has imported into its final decision and order various transactions, facts, events and arguments of which they had no notice and which they had not been given a proper opportunity to rebut.
The STAT dealt with the argument by simply observing that "for considering the obtainable facts a fresh opportunity to appellants in my opinion was not very much required, as there would not be any end to it." The learned Single Judge in the High Court recognised that: "If such long spell time has lapsed and such new material has come into existence the proper course for the RTA should have been to get the case listed back for comments of both the parties but did not think that "the case warranted any interference on this aspect.
" The Division Bench observed: "It was urged on behalf of the appellants that the Regional Transport Authority took into account events after hearing and closing the cases without giving any opportunity to the appellants to rebut that material.
It was also urged that out of 83 documents filed by the appellants before the Regional Transport Authority in rebuttal of this material, only 2 were accepted, while remaining 81 were rejected.
There is no merit in this contention.
The mere fact that the appellants filed these documents out of which two were taken into account shows that they had the knowledge of the subsequent material being used for the purpose of deciding these cases and it is for this reason that they filed these documents out of which two were also taken into account.
Moreover, the subsequent events relate only to matters of record pertaining to operation of the existing routes by the 646 State Transport Undertaking.
There is thus no prejudice to A the appellants.
This argument is, therefore devoid of any merit.
In our opinion the approach of the STAT as well as the High Court was erroneous.
There is no doubt that the R.T.A. in deciding the present case has been influenced not merely by the discussions which took place during the hearing of the applications of these petitioners and the Corporation but also the facts circumstances, and arguments that surfaced at the meetings held by it in relation to various other permits in the State.
It is true that the point that arose for consideration viz. whether the Corporation had placed sufficient material on record to satisfy the R.T.A. concerned that the grant of a further permit or further permits to it would not prejudicially affect the nationalised services already run by it was, in a sense, a point common to all the meetings.
Nevertheless, the grant of a permit in each case is a separate issue to be decided on the facts and circumstances placed on record in relation to that case.
In support of their claims for permits, the petitioners had placed some material before the R.T.A. and so also the Corporation.
If, in reaching its decision, the R.T.A. desires to take into account circumstances and facts placed by other petitioners or by the Corporation at other meetings, the petitioners should atleast have had an opportunity of knowing what that material was.
This could have been done either by allowing the petitioners to participate at the other meetings or by giving the substance of that material to the petitioners, and giving them an opportunity of rebutting it before passing the final order.
In this context it is important to remember that the Corporation was a party at all the meetings and was aware of all the materials that had been placed on record by other operators as well as by themselves thereat.
On the contrary, the petitioners were handicapped in that they had no knowledge of the material placed at the other meetings.
In our opinion, the requirements of natural justice were flouted by the failure of the RTA to apprise the petitioners, atleast broadly, of what had transpired at the other meetings.
The High Court has observed that the petitioners had not been prejudiced as is seen from the fact that they had placed several documents on record in rebuttal of the Corporation 's case.
It may be, as pointed out by the High Court, that the petitioners were vaguely aware of the nature of the general contentions urged as well as the evidence placed by the Corporation and also tried to put in some documents to controvert the material placed on record by the Corporation but they 647 had no direct knowledge of such material.
Further, the petitioners ' grievance is that out of 83 documents placed by the petitioners only two were considered.
We are not able to appreciate the High Court 's answer to this contention in the extract we have quoted above.
We could have understood it if the other 81 documents which the petitioners relied upon had been found to be irrelevant.
The R.T.A. has not discussed this evidence.
Nor does the STAT appear to have considered the material or given the petitioners an opportunity, atleast at the appellate stage to attempt to substantiate its contentions by reference to these documents.
In the Special Leave Petitions before us, the petitioners have catalogued several circumstances to substantiate a contention that the Corporation was not in a position to undertake the plying of buses on the routes in question without prejudice to the efficiency of the nationalised services already being run by it.
We express no opinion on the correctness of these averments or the effect they can have on the satisfaction to be reached by the Regional Transport Authority but it appears manifest that the impugned order rejecting the renewal applications of the petitioners has been passed without there being reasonable opportunity given to the petitioners to counter the case put forward by the Corporation.
On this short ground that the procedural requirements of natural justice have not been complied with, we think, the impugned order should be set aside and the R.T.A. directed to pass a fresh order after giving the opportunity to the Petitioners to put forward their contentions.
Shri Shanti Bhushan, learned counsel for the Corporation, raised two contentions.
He urged, firstly, that the present case was governed by section 58(2) and not by section 47( 1H) and that the Corporation was rightly granted precedence over the private operators.
We are unable to accept this contention for two reasons.
In the first place the grant of a permit for an inter State route is governed by the special provision contained in section 47( lH) and not by section 58 which is a general provision.
Secondly, even under Section 58, the Corporation is not entitled to a permit automatically by reason of the fact that it is a State Road Transport Undertaking.
It is entitled to a priority over private operators only on "other things being equal".
In other words, even if section 58 is to apply, the RTA has to apply its mind to the relative merits of the private operators on the one hand and the Corporation on the other and it is only if both of them stand on the same footing that the Corporation would be entitled to a preference.
This would necessarily involve a hearing by the RTA of the merits of both the contending parties.
648 The second contention of counsel is based on an interpretation of A section 47(1 H).
The principle and ratio of this provision has been discussed and approved by this Court in Sher Singh vs Union of India, A.I.R. 1984 SC 209.
This provision no doubt enables the Corporation to have a preference over private operators and individuals but this is subject to a condition precedent that it should satisfy the Authority that it E3 would be able to operate the inter State route for which permit is sought without detriment to the efficiency and adequacy of the nationalised services it is already running in the State.
Shri Shanti Bhushan would contend that this is a matter on which the Regional Transport Authority has to reach a subjective satisfaction in the light of such material as it may be able to gather and that it is not necessary that it should be arrived at after giving an opportunity to all the persons appearing before the Authority.
We cannot accept this interpretation.
Like analogous provisions contained in several statutes which require or permit certain action to be taken on the satisfaction of a particular specified authority, the provision in section 47( lH) also requires the R.T.A. to arrive at its satisfaction not subjectively but on an objective consideration of the various facts and circumstances placed before it.
It will at once be obvious that such a satisfaction cannot be reached by the Authority without hearing the various operators.
The matter comes up before the Authority on a contest between an application for a permit or a renewal application of a private operator and an application for permit by the Corporation.
Naturally, the Corporation will place before the Authority some material to satisfy the Tribunal that the condition mentioned in the proviso to section 47(1H) is satisfied.
The R.T.A.
On its own can have no method of assessing the merits of this plea.
It is only the private operators, who are seeking permits for themselves that may be in a position to place material which would show that the Corporation does not have the capacity to take up this additional responsibility of running buses on the inter State route for which it seeks a permit.
It is clearly the duty of the R.T.A. to consider the evidence placed by both the parties, allow each party an opportunity to rebut the material placed by the other and arrive at its satisfaction one way or the other.
The satisfaction contemplated under section 47( lH) is a satisfaction to be arrived at on the basis of such a quasi judicial enquiry conducted by the R.T.A. It is, therefore, not possible to accept the contention that the petitioners were not required to be heard before the R.T.A. reached its conclusion in favour of the Corporation.
For the reasons discussed above, we hold that the petitioners ' applications for renewal of permits as well as the Corporation 's appli 649 cation for fresh permits on the inter State route Bhadra to Hissar via Adampur require to be considered afresh.
We, therefore, set aside the order of Regional Transport Authority dated 27.11.1982, the order of the State Transport Appellate Tribunal dated 20.1. ]983 as well as the order of the Single Judge of the High Court dated 21st July, 1986 and the order of the Division Bench of the High Court dated 8.12.1986.
The matter will stand remanded to the file of the R.T.A., Bikaner, for being disposed of afresh in the light of the above observations.
The appeals are allowed but in the circumstances we make no order as to costs.
S.L. Appeals allowed.

Output:
% The appellants filed applications for renewal of their stage carriage permits on a route in Rajasthan, under section 58 of the Motor Vehicles Act.
At the same time, the Rajasthan State Road Corporation(Corporation) moved applications for the grant of fresh permits to it for the same route.
Both the applications for renewal of permits and the applications for fresh permits, were heard together by the Regional Transport Authority (R.T.A.) which reserved its orders thereon.
The R.T.A. passed orders in the matters after a year of the hearing, rejecting the renewal applications of the appellants and granting fresh permits to the Corporation.
The R.T.A. had, during the intervening period of one year, held several other proceedings and meetings in connected matters of which no notice and no opportunity had been given to the appellants whereas the Corporation was a party to all those meetings and discussions before the R.T.A.
Against the orders of the R.T.A., the appellants filed appeals before the State Transport Appellate Tribunal (S.T.A.T.).
The S.T.A.T. dismissed the appeals.
The appellants moved the High Court by writ petitions against the order of the S.T.A.T.
The High Court (Single Judge) dismissed the writ petitions.
Further appeals by the appellants to the Division Bench of the High Court were also dismissed.
The appellants moved this Court by special leave.
Allowing the appeals, the Court, ^ HELD: The principal issue to be decided by the R.T.A. was whether the claims of the Corporation for fresh permits had precedence over the claims of the appellants for the renewal of their permits.
[643E] 642 The appellants have not had an opportunity of putting forward their contentions and of being heard before the R.T.A. in the various proceedings meetings held by the R.T.A. during the period of one year following the reservation of orders by it on the applications of the Appellants and the Corporation.
The principles of natural justice were flouted by the R.T.A. by its failure to apprise the appellants of what had transpired at the meetings/discussions held in their absence.
[646D F] The appellants ' applications and the applications of the Corporation require to be considered and disposed of afresh by the R.T.A. in the light of the observations made by the Court.
[648H, 649A] Sher Singh vs Union of India, AIR 1984 SC 200, referred to.


Input:
ial Leave Petition (C) Nos.
4304 06 of 1993.
From the Judgment and Order dated 18.12.1992 of the Calcutta High Court in Appeal from Original Order Nos.
and 106 of 1991.
Panchugopal Bose in person for the Petitioner.
D.P. Gupta, Solicitor General, A.K Sil and G. joshi for the Respondent.
The Judgment of Court was delivered by K. RAMASWAMY.
J.: These three Special Leave Petitions arise out of Arbitration Agreement said to be executed by the petitioner on May 27, 1978 which provided that the petitioner had to execute the work within 9 months.
It is 363 his claim that while executing the work he sent the bills on July 12, 1979 but payment was not made.
For the first time he sent notice on Nov. 28, 1989 to the respondent for reference to the arbitration.
On receipt thereof, the respondent filed an arbitration suits in the Calcutta High Court under sections 5, 12 and 33 of the for short the Act.
The learned Single Judge held that the claim was hopelessly barred by limitations There was no proof that the petitioner had sent any claim in July, 1979.
Since the Claim was made long after 10 years the arbitration cannot be proceeded with.
Accordingly finding that it to be an exceptional case for interference, the learned Single Judge cancelled the arbitration clause 68 of the contract in matter Nos. 1326, 1364 and 1365/90 dated November 23. 1990.
On further appeals the division bench by its order dated December 18, 1992 in Appeal Nos 104/90 etc.
dismissed the appeals.
Thus these special leave petitions.
The contention of the petitioner appearing in person is that Clause 68 of the Contract provides for appointment of an arbitrator and when the petitioner has legally invoked clause 68 and issued notice to the respondent, the respondent is duty bound to appoint an arbitrator and on its failure it is open to him to approach the Court for appropriate remedy under section 8 of the Act for appointment of an arbitrator.
The High Court scuttled this procedure in exercising the power under section 5 of the Act which is illegal and ultra vires.
He further contented that Section 5 has no application to the facts of this case.
We have heard also Shri D.P. Gupta, the learned Solicitor General for the respondent.
The question for consideration is whether the High Court was justified in permitting the respondent to rescind the contract of Arbitration provided in Clause 68 of the Contract.
Undoubtedly, Clause 68 provides reference to arbitration of all or any of the disputes or differences enumerated therein that have arisen between the parties, at the instance of either party to the contract.
It empowers either party to issue notice calling upon the Engineer to refer the dispute or difference for arbitration.
In this case, as found by the High Court that though the petitioner was said to have made the claim for payment for the first time in July 12, 1979.
Though there is no proof in that behalf, and the respondent claimed that the petitioner had abandoned the contract, even assuming that any claim was as a fact made in July.
1979 and payment was not made, the petitioner had not taken follow up action thereafter for well over 10 years.
It was open to him to avail Clause 68 of the contract seeking reference to the arbitration.
No such action was taken till November 28, 1989 Immediately on receipt of the notice, the respondent invoked the jurisdiction of the Calcutta High Court under sections 5 and 12 at 330 of the Act.
Section 5 provides thus: 364 "The authority of an appointed arbitrator or umpire shall not be revocable except with the leave of the Court, unless a contrary intention is expressed in the arbitration agreement".
Therefore, Section 5 postulates that there must be an order of appointing an arbitrator or umpire and thereafter the same cannot be revoked except with the leave of the Court, unless a contrary intention is expressed in the agreement.
Exfacie it would appear that appointment of an arbitrator is a condition to avail the remedy under s.5.
Section 12 accords consequential power which postulates that the power of the Court where Arbitrator is removed or his authority revoked.
Subsection (2) says that: "Where the authority of an arbitrator or arbitrators or an umpire is revoked by leave of the Court, or where the Court removes an umpire who has entered on the reference or a sole arbitrator or all the arbitrators, the Court may, on the application of any party to the arbitration agreement, either (b)order that the arbitration agreement shall cease to have effect with respect to the difference referred." Therefore, by a conjoint reading of sections 5 and 12 (2) (b) it is clear that the court has been given power in given circumstances to grant leave to a contracting party to have the arbitrator or umpire removed and the arbitration agreement entered into with other contracting part revoked.
Where the Court grants such authority consequentially arbitration agreement shall cease to have effect with respect to the difference or dispute.
It flows therefrom that there exist implied power vested in the court permitting a party to avail the remedy under sections 5 & 12 to rescind the arbitration agreement.
In all cases it is not a condition precedent that there should in the first instance be an order appointing an arbitrator or he should enter upon reference for adjudication.
In given circumstances and the factual background the court may be justified to exercise the power under ss.5 and 12.
The question then is under what circumstances such power would be exercised.
This Court in M/s Amarch and Lalit Kumar vs Shree Ambica Jute Mills Ltd. ; at 969 held thus: "In exercising its discretion cautiously and sparingly the Court has no doubt (kept) these circumstances in view, and consider that the parties should not be relieved from a tribunal they have chosen because they fear that the arbitrator 's decision may go against them.
The grounds on which leave to revoke may be given have been put under five heads: 365 1.
Excess or refusal of jurisdiction by arbitrator; 2.
Misconduct of arbitrator; 3.
Disqualification of arbitrator; 4.
Charges of Fraud; and 5.
Exceptional cases.
Thus it could be seen that the Court has the power and jurisdiction under sections 5 and 12 to grant leave to the applicant in exceptional circumstances to revoke the contract of arbitration.
The court should exercise the power sparingly, cautiously and with circumspection to permit a party to the contract of a arbitration voluntarily entered into to relieve the party from dispute or difference and to order that the arbitration agreement shall cease to have effect in respect of the dispute or difference.
In this case we have seen that even assuming that the petitioner had putforward his claim in July, 1979 and the respondent had not acted thereon till November 28, 1989 for long 10 years he did not move his little finger to approach the Engineer and later the Court.
For the first time on November 28, 1989 he issued notice to the respondent to refer the case for arbitration.
Clause 68 of the Contract provides that when any disputes or differences has arisen he should approach the Engineer in the first instance seeking reference of it to an arbitration and if the Engineer refuses to act upon or omits to refer the dispute to the arbitration within 15 days from the date of the receipt of notice, then it is open to him to approach a Civil Court for reference to the arbitration.
On his own showing cause of arbitration has arisen in July, 1979, the petitioner did not take any action from then.
On the other hand when notice was issued in November, 1989 the respondent immediately approached the Court and sought its leave to rescind the agreement explaining the circumstances.
The Court exercised the jurisdiction in permitting the respondent to revoke the arbitration agreement.
The question then is whether it is justified? Section 37 (1) of the Act provides that all the provisions of the Indian Limitation Act, 1908 (since amended Act came into force in 1963) shall apply to arbitrations as they apply to the proceedings in court.
Sub section (2), employing non obstenti clause, says that notwithstanding any term in an arbitration agreement to the effect that no cause of action shall accrue in respect of any matter required by the agreement to be referred until an award is made under the agreement, a cause of action shall, for the purpose of limitation, be deemed to have accrued in respect of any such matter at the time when it would have accrued but for that term in the agreement.
Sub section (3) thereof states that for the purposes of this section and of the Indian Limitation Act, 1908 an arbitration shall be 366 deemed to be commenced when one party to the arbitration agreement serves on the other party thereto a notice requiring the appointment of an arbitrator, or where the arbitration agreement provides that the reference shall be to a person named or designated in the agreement, requiring that the difference be submitted to the person so named or designated.
Sub sections (4) and (5) are omitted as being not material.
It would, therefore, be clear that the provisions of the Limitation Act would apply to arbitrations and notwithstanding any term in the contract to the contrary, cause of arbitration for the purpose of limitation shall be deemed to have accrued to the party in respect of any such matter at the time when it should have accrued but for the. contract.
Cause of arbitration shall be deemed to have commenced when one party serves the notice on the other party requiring the appointment of an arbitrator.
The question is when the cause of arbitration arises in the absence of issuance of a notice or omits to issue for long time or contract to the contrary? It is stated in Robertson 's History that honest men dread arbitration more than they dread law suits.
The arbitrations differ from legal proceedings proper only in the choice of tribunal and all ordinary defences legally permissible are available to the Parties.
Parties to an arbitration may voluntarily determine among themselves the procedure to be followed including the constitution of the arbitral tribunal to adjudicate the dispute or differences arising from the contract including the power of the arbitrator.
They could also contract restricting the limitation for adjudication.
Subject to the above section 37 of the Act regulates the limitation for the arbitration proceedings.
In Ram Dutt Ramkissendass vs Sassoon (E.D) & Co. 1929 (56) Indian Appeals 128, the Privy Council held that although, it is indisputable that, in a modern arbitration, the principles of equity must be applied just as they would now be applied in a court of law, since upon a special case for the opinion of the court under Sec. 7 if the or the Judicature Act, 1925, s.94 (replacing sec.
19 of the ), the court is, and has long been, bound to apply equitable rules and relief.
It is difficult to see how the equitable view of the applicability of Limitation Act, 1908, to a case of debt can be excluded in a legal arbitration.
Although the Limitation Act does not in terms apply to arbitrations, they (their Lordships of the Judicial Committee) think that in mercantile reference of the kind in question it is an implied term of the contract that the arbitrator must decide the dispute according to the existing law of contract, and that every defence which would have been open in a court of law can be equally proponed for the arbitrator 's decision unless the parties have agreed which is not suggested here to exclude that defence.
Were it otherwise, a claim for breach of contract containing a reference cause could be brought at any time, it might be 20 or 30 years after the cause of action had arisen, although the legislature has prescribed a limit of three years for the enforcement of such a claim in any application that 367 might be made to the law courts.
This ratio was approved by House of Lords in Naamlooze Vennootschap Handels En Transport Maatschappij "Vulcaan ' vs A/S J. Ludwig Mowinckels Rederi [1938]2 All E.R. 152, Lord Maugham, L.C. speaking for the unanimous Court held that in considering whether the Limitation Act would apply to arbitration (pre statutory arbitrations), it was held that this seems to be a good reason for holding that there may well be cases where the object of both parties to the arbitration might be to determine whether a sum was due, though possible or certainly not recoverable by legal Proceedings.
We are, however, here concerned with an arbitration in which legal rights are being advanced or denied If the defence of the statute is to be deemed in admissible, it would seem that the claims of one party or the other might be put forward long after the persons who could give useful evidence had died and the most relevant documents had been destroyed If the legal defence were to be excluded, it was in this agreement that one would expect to find such a provision The matter does not rest cause we have to consider how far the suggested elimination of defences available at law or in equity must logically be held to extent in other arbitrations.
If the party defending may not rely on the Statute of Limitations, can he rely on the Statute of Frauds, or the Act partially replacing it? Could he rely in a commercial arbitration on the Garming Act? A number of like questions might be asked It is indisputable that, in a modem arbitration, the principles of equity must be applied just as they would now be applied in a court of law.
In the concluding findings it is said thus: "In the circumstances of this case as above stated, it is, I think, impossible to come to the conclusion that there was an implied agreement between the parties to exclude any defence under any Statute of Limitations.
In the absence of such an implied agreement, the Limitation Act was open to the respondents, and the consequence must follow that the arbitrator was acting rightly in admitting the defence under the statute".
In Pegler vs Railway Executive 1948 Appeal Cases 332 at 338, House of Lords held that just as in the case of actions the claim is not to be brought after the expiration of a specified number of years from the date on which the cause of action accrued, so in the case of arbitrations, the claim is not, to be put forward after the expiration of the specified number of years from the date when the claim accrued.
While accepting the interpretation put up by Atkinson, J. as he then was in the judgment under appeal, learned Law Lords accepted the conclusion of Atkinson, in the Language thus: "the cause of arbitration" corresponding to "the cause of action" in litigation "treating a ' cause of arbitration in the same way as a cause of action would be treated if the proceeding were in a court of law.
368 In West Riding of Yorkshirs Country Council vs Huddersfield Corporation , the Queens Bench Division, Lord Goddard, C. J. (as he then was) held that the Limitation Act applies to arbitrations as it applies to actions in the High Court and the making, after a claim has become statute barred, of a submission of it to arbitration, does not prevent the statute of limitation being pleaded.
Russell on Arbitration, 19th Edition, reiterates the above proposition.
At page 4 it was further stated that the parties to an arbitration agreement may provide therein, if they wish, that an arbitration must be commenced within a shorter period than that allowed by statute; but the court then has power to enlarge the time so agreed.
The period of limitation for commencing an arbitration runs from the date on which the cause of arbitration accrued, that is to say, from the date when the claimant first acquired either a right of action or a right to require that an arbitration takes place upon the dispute concerned.
Therefore, the period of limitation for the commencement of an arbitration runs from the date on which, had there been no arbitration clause, the cause of action would have accrued.
Just as in the case of civil actions the claim is not to be brought after the expiration of a specified number of years from the date on which the cause of action accrued, so in the case of arbitrations, the claim is not to be put forward after the expiration of the specified number of years from the date when the claim accrued.
In Russell on Arbitration, at pages 72 and 73 it is stated thus: "Disputes under a contract may also be removed, in effect, from the jurisdiction of the court, by including an arbitration clause in the contract, providing that any arbitration under it must be commenced within a certain time or not at all, and going on to provide that if an arbitration is not so commenced the claim concerned shall be barred.
Such provisions are not necessarily found together.
Thus the contract may limit the time for arbitration without barring the claim depriving a party who is out of time of his right to claim arbitration but leaving open a right of action in the courts.
Or it may make compliance with a time limit a condition of any claim without limiting the operation of the arbitration clause, leaving aparty who is out of time with the right to claim arbitration but so that it is a defence in the arbitration that the claim is out of time and barred.
369 Nor, since the provisions concerned are essentially separate, is there anything to prevent the party relying on the limitation clause waiving his objection to arbitration whilst still relying on the clause as barring the claim.
" At page 80 it is stated thus: "An extension of time is not automatic and it is only granted if "undue hardship" would otherwise be caused.
Not all hardship, however, is "undue hardship," , it may be proper that hardship caused to aparty by his own default should be borne by him and not transferred to the other party by allowing a claim to be reopened after it has become barred.
The mere fact that a claim was barred could not be held to be "undue hardship.
" The Law of Arbitration by Justice Bachawat in Chapter XXXVII at p.549 it is stated that just as in the case of actions the claim is not to be brought after the expiration of a specified number of years from the date when the claim accrues, as also in the case of arbitrations, the claim is not to be put forward after the expiration of a specified number of years from the date when the claim accrues.
For the purpose of section 37 (1) 'action ' and cause of action ' in the Limitation Act should be construed as arbitration and cause of arbitration.
The cause of arbitration, therefore, arises when the claimant becomes entitled to raise the question, i.e. when the claimant acquires the right to require arbitration.
The limitation would run from the date when cause of arbitration would have accrued, but for the agreement.
Arbitration implies to charter out timous commencement of arbitration availing the arbitral agreement, as soon as difference or dispute has arisen.
Delay defeats justice and equity aid the promptitude and resultant consequences.
Defaulting party should bear the hardship and should not transmit the hardship to the other party, after the claim in the cause of arbitration was allowed to be barred.
The question, therefore, as posed earlier is whether the court would be justified to permit a contracting party to rescind the contract or the court can revoke, the authority to refer the disputes or differences to arbitration.
Justice Bachawat in his Law of Arbitration, at p. 552 stated that "in an appropriate case leave should be given to revoke the authority of the arbitrator '.
It was also stated that an ordinary submission without special stipulation limiting or conditioning the functions of the arbitrator carried with it the implication that the arbitrator should give effect to all legal defences such as that of limitation.
Accordingly the arbitrator was entitled 370 and bound to apply the law of limitation.
Section 3 of the Limitation Act applied by way of analogy to arbitration proceedings, and like interpretation was given to section 14 of the Limitation Act, The Proceedings before the arbitration are like civil proceedings before the court within the meaning of section 14 of the Limitation Act, By consent the parties have substituted the arbitrator for a court of law to arbiter their disputes or differences.
It is, therefore, open to the parties to plead in the proceedings before him of limitation as a defence.
In Mustiu and Boyd 's Commercial Arbitration (1982 Edition) under the heading "Hopeless Claim" in Chapter 31 at page 436 it is stated thus: "There is no undoubtedly jurisdiction to interfere by way of injunction to prevent the respondent from being harassed by claim which can never lead to valid award for example in cases where claim is brought in respect of the alleged Arbitration agreement which does not really exist or which has ceased to exist.
So also where the dispute lies outside the scope of Arbitration agreement".
The case on hand is clearly and undoubtedly hopelessly barred claim as the petitioner by his conduct slept over his right for more than 10 years.
Statutory arbitrations stand apart.
In these circumstances it is an exceptional case and the courts below have justifiably exercised their discretionary power, and jurisdiction under sections 5 and 12(2) (b) to permit the respondent to rescind the arbitration agreement and declared that the arbitration agreement shall cease to have effect with respect to the difference or dispute referred to in the notice of the petitioner and relieved the parties from the arbitration agreement.
The Special Leave Petitions are accordingly dismissed without costs.
U.R Appeal dismissed.

Output:
On May 27, 1978, the petitioner entered into an arbitration agreement under which he had to execute a certain work within 9 months.
He averred that he had sent his bills on July 12, 1979, but payment was not made.
On November 28, 1989, for the first time he sent a notice to the respondent for reference to arbitration.
The respondent approached the High Court under Ss. 5,12 and 33 of the .
A learned Single Judge held that the claim was hopelessly barred by limitation, and cancelled the arbitration agreement.
A Division Bench dismissed the Appeal.
On appeal, this Court addressed itself to 2 questions: Whether the High Court could permit a party to rescind an arbitration agreement; and whether delay can be a ground for rescinding such agreement.
Dismissing the appeal, this Court, HELD:1.
The Court has the power and jurisdiction under Ss. 5 and 12 to grant leave to the applicant in exceptional circumstances to revoke the contract of arbitration.
The Court should exercise the power sparingly, cautiously and with circumspection in permitting a party to rescind an arbitration agreement he had entered into voluntarily.
(365 B) 2.By virtue of section 37 of the , the provisions of the Limitation Act would apply to arbitrations, notwithstanding any term in the contract to the contrary.
(366 B) 3.The period of limitation for the commencement of an arbitration runs from the date on which, had there been no arbitration clause, the cause of 362 action would have accrued, just as in the case of actions the claim is not to be brought after the expiration of a specified number of years from the date on which the cause of action accrued, so in the case of arbitrations, the claim is not to be put forward after the expiration of the specified number of years from the date when the claim accrued.
(368 D E) Ram Dutt Ramkissen dass vs
Sassoon(E.D.)&Co.(1929)(56)1A 128(PC); Naamlooze Vennootschap Handels En Transport Maatschappij ' Vulcan ' vs A/S J. Ludwig Mowinckels Rederi [1 938] 2 All ER 152; Pegler vs Railway Executive at 338 and; West Riding of Yorkshire Country Council Huddersfield Corporation [1957] 1 AR ER 669 and Russell on Arbitrations; Justice Bachawat Law of Arbitration, applied.
Delay defeats justice: Defaulting party should hear the hardship and should not transmit the hardship to the other party, after the claim in the cause of arbitration was allowed to he barred.
(369 F ) Mustiu and Boyd 's Commercial Arbitration (1982 edn.), referred to.
The claim in the case on hand is undoubtedly hope lessly barred by limitation as the petitioner by his conduct slept over his right for more than 10 years.
The High Court justifiably exercised the discretionary power and jurisdiction under Ss. 5 and 12 (2) (b) in permitting the respondent to rescind the agreement.
(370 E)