Input:
Appeal No. 208 of 1969.
August 19, 1960, of the Third Industrial Tribunal, West Bengal, in Case No. VIII 119 of 1958.
A. V. Viswanatha Sastri, section K. Bose and Sardar Bahadur, for the appellant.
D. N. Mukherjee, for respondent No. 1.
Janardan Sharma and B. P. Maheshwari, for respondent No. 2. 1962.
August 21.
The following Judgment of the Court was delivered by MUDHOLKAR, J. The substantial question which.
falls for decision in this appeal by special leave.against an award made by the Third Industrial Tribunal, West Bengal, centres round the 662 question of production bonus.
The appellant company runs a steel mill at Belur.
There are various departments in the mill which have been grouped under three headings: direct productive departments, indirect productive departments and nonproductive departments.
In the last mentioned group come the general office, accounts department, establishment department, time office. stores, shipping department, drawing and design department, laboratory, progress and planning department, civil construction department, watch and ward department, medical department , and welfare department.
The first group consists of the following five departments : 1.
Steel foundry 2.
Electric Furnaces 3.
Rolling Mills 4.
Bolt and nuts shop and 5.
Machine shops.
The second group consists the following departments : 1.
Refractory attached to the electric furnaces 2.
Mill General, attached to the rolling Mills 3.
Roll turning, attached to the rolling Mills 4.
Yard Mazdoors, attached to the rolling mills and 5.Civil maintenance department, electric maintenance department and mechanical 'Maintenance department.
It is common ground that each productive department has an individual target for the purpose 663 of payment of production bonus over and above the wages.
The existing targets were fixed (a) in 1948, in electric furnaces and rolling mills;(b) in December, 1956, in the steel foundry and(c) in January, 1959, in the bolt and nut workshop.
According to the appellant the targets were revised from time to time in consultation and with the concurrence of the representatives of the workmen of the department concerned as and when occasion arose for doing so in consequence of the adoption of better methods of production, now techniques, addition of plant and machinery etc.
The workmen in three indirect productive departments, namely, refractory attached to the electric furnace, 'mill general ' attached to the rolling mills and roll turning attached to the rolling, mills are paid production bonus at the rate of 75% of the average rate of production bonus earned by the respective direct productive department to which these three indirect productive departments are attached.
The Yard Mazdoors attached to the rolling mills are paid on the basis of an arbitration award which is subsisting between the workmen and the company.
In civil maintenance, electric maintenance and mechanical maintenance departments, the workmen are paid production bonus at the rate of 75% of the average rate calculated on the basis of production bonus paid to the workmen in the productive, departments taken together.
In the steel foundry department, the target was 20 pounds per man per day until the end of 1956.
Towards the end of 1956 the Appellant had direct negotiations with the workers ' representatives of the department, and in view of the additions to the 664 plant and machinery and provision for additional facilities and working space and improvement in the technique of production 'Which raised considerably the production capacity of the said department, it was agreed to raise the target upto 25 pounds per man per day, The value of machinery and plant added to this department alone would be about Rs. 2 lakhs.
About Rs. 4.5 lakhs worth of electric cranes were also subsequently installed.
They are working for this department and the electric furnace department.
Since December, 1956 there have been further additions of machinery etc, to the extent of about Rs. 3 lakhs in this department alone.
According to the appellant the workmen all along worked without protest against the targets in force from time to time.
But nine months after the revised targets came into operation the second respondent, which is one of the two unions to which the workmen of the company belong, protested against the raising of targets in the steel foundry department form 20 to 25 pounds.
According to the appellant company, different schemes for payment of incentive bonus have been adopted in the different departments because incentive bonus is directly linked up with production targets.
These targets, according to the appellant, have been fixed by direct negotiations with the workman 's representatives in the respective departments as for instance the increase of the targets in the steel foundry from 20 pounds to 25 pounds per head per day at the end of the year 1956.
The respondent No, 1 which is the other union did not make any protest in this matter and indeed even in the proceedings before the Tribunal it did not join hands with the second respondent.
The Government of West Bengal, having come to the conclusion that an industrial dispute had arisen between the appellant and its workmen 665 with respect to the payment of incentive bonus, referred it for adjudication to the Third Industrial Tribunal under section 10 of the .
Both the unions filed their written statements before the Tribunal.
Subsequently disputes on the same question with three associate companies were also referred for adjudication to the same Tribunal.
We are, however, not concerned with the disputes other than the one in which the appellant, the National Iron & Steel Co. Ltd., is concerned.
The substance of the claims made on behalf of the workmen by the respondent No. 2 may be briefly summarised thus: The incentive bonus scheme at present in force should be revised so as to cover those categories of workmen who are at present out of it and to remove all anomalies in the existing scheme as well as to remove such differences as are found to exist.
It is further claimed that the present targets of production should be refixed and brought to the 1948 level.
The first respondent did not attack the targets on the standard of performance or production existing in the different departments of National Iron & Steel Co. Ltd. The main thing it wants is that the scheme of incentive bonus should be extended to all productive departments at the same rate without making any distinction between alleged direct productive workmen and alleged indirect productive workmen.
It wants that workmen in the indirect productive departments should be paid incentive bonus at the same rate at which workmen of the productive department to which the particular indirect productive department is attached are paid.
It also wants that a workman employed in the maintenance department, civil maintenance department 666 and siding maintenance department of the appellant should be paid one half of the total rate arrived at by adding the rates at which all the productive departments of the appellant as also the workmen of the associate companies are paid, As regards the workmen employed in the non productive departments it wants them to be paid bonus at one fourth of the total rate arrived at by adding the rates at which the workmen in the productive departments are paid.
It wants also that four employees in the shipping department should be paid at the rate at which the workmen of the rolling mills department are paid and the three chemists in the laboratory should be paid the same rate as workmen in electric furance department.
Finally it wants incentive bonus to be assessed on the basis of basic wages and dearness allowance earned by the workmen and also on the basis of the total earnings including the earnings for the days described as non productive days.
We may mention here that the appellant has denied that there were any anomalies in respect of the incentive schemes in the various departments.
The stand that it takes is that the introduction of such schemes being entirely the function of the management the company is under no legal or moral obligation to extend it to all categories of workmen.
The claim of the respondent No. 1 for the revision of targets and removal of anomalies and differences in the existing bonuses is thus said to be wholly unfounded.
The appellant has further justified the classifications of departments into direct productive, indirect productive and nonproductive on the ground that.
it is in conformity with the existing practice in the industry.
The employees in the productive departments are paid incentive bonus at the full rate which is normally payable for them for the 667 work they do and that there is no practice of employing direct productive workers in the indirect productive departments and that the workmen employed in the maintenance department are paid at 75% of the average bonus.
Production bonus, according to it, is paid to such workmen as are directly engaged in production work and maintenance and that non productive workmen are not covered by the existing scheme.
It also disputes the claim made by the first respondent on behalf of four clerks in the shipping department and the three chemists in the laboratory.
After the statements were filed by all the parties it was urged on behalf of the appellant that issues should be framed.
But the Tribunal did not accede to the request.
Ultimately, by an order made by it, the Tribunal said that it would adjudicate only on those points which were raised in subparagraphs "1, 2(b) and (c) of paragraph 18 of the written statement filed by the NISCO Karmachari Sanghs (respondent No. 1) and also on the points raised in the prayer portion in paragraph 25 of the written statement of Belur Iron & Steel, Workers ' Union (respondent No. 2)".
The Tribunal first considered the question of the revision of tragets.
According to it the target in the steel foundry department which was raised in December, 1956 from 20 lbs.
to 25 lbs.
should be reduced to 23 lbs.
In regard to the electric furnace department, rolling mills, bolt and nut shop and machine shop the Tribunal held that the target should be 50% of the productive capacity or efficiency of the workmen of the department.
It negatived the claim of the workmen for removal of the alleged anomalies in the existing bonus scheme.
With regard to the workmen 's claim for the exten 668 sion of the scheme to the clerical and watch andward staff the Tribunal held as follows: "This incentive production bonus shall be paid to workmen of the non productive departments at '.he rate of 12 1/2% of the total rate to be arrived at, by adding the rates at which all the productive departments may be paid.
This rate is allowed in consideration of the fact that the workmen of the non productive departments are not directly connected with production but only remotely.
The calculation of this bonus will be made with reference to basic pay only excluding D.A." The Taibunal further held that this would also apply to the four workmen in the shipping department and three chemists in the laboratory.
In so far as the workmen employed in the indirect productive department were concerned the Tribunal held that there was no case for making any change because the present rate of 75% of the bonus paid to the workmen of the productive departments was fair and reasonable. 'The Tribunal rejected the claim of the workmen that rates of production bonus to all categories of workmen whether employed in direct productive or indirect productive departments have to be uniform.
One of the points urged on behalf of the appellant before the Tribunal and taken in the statement of the case is that the introduction of incentive bonus, fixation of targets and fixation of production hours is a function of the management and the Tribunal has no right to interfere.
It has been held by this Court in Titaghur Paper Mills Co. Ltd. vs Its Workmen (1) that while it is the function of the management whether or not to introduce a scheme of incentive bonus, once such a scheme is (1) [1959] Supp. 2 S.C.R. 1012.
669 introduced the right to claim such bonus become,; a condition of service of workmen and, therefore, the Industrial Tribunal has jurisdiction to vary the scheme enforced by the employer including the rates of bonus.
This Court has pointed out in that case that the payment of incentive bonus is payment of further emoluments to the workmen depending not upon extra profits but upon extra production, as an incentive to them to put in more than the standard performance.
Where, therefore, the management has introduced a scheme for the grant of such bonus it is open to the Tribunal to vary the terms of the scheme if the circumstances of the case justify its doing so.
In view of the decision in that case Mr. Vishwanatha.
Sastri fairly conceded that the tribunal had jurisdiction to refix the targets as well as to refix the rates of the incentive bonus provided it found that the targets were too high or the rates wholly incommensurate to the additional performance put in by the workmen.
His main grievance on this score, however, was that the Tribunal had no material before it for reducing the targets in the steel foundry department, from 25 lbs.
per capita per day to 23 lbs.
He further contended that the view of the Tribunal that the targets for the other direct productive departments should be 50% of the capacity of the unit or the efficiency of workmen would lead to startling results.
He also drew our attention to an application made by the appellant during the course of the proceedings before the Tribunal for the appointment of assessors for the purpose of giving opinion on various technical matters which have to be borne in mind for the preparation of a scheme for incentive bonus payable to workmen engaged in different departments of the appellant.
No order was passed on this application by the Tribunal even though on ' being reminded of its omission to do so the Tribunal promised to make an order later.
So here we are faced with a situation where there 670 is no adequate data for judging what would be reasonable and proper targets from the point of view of both the employeres and the employees and what would be the reasonable rates of incentive bonus.
The Tribunal would have done well to bear in mind the fact that for the determination of technical matters it is always desirable to have the assistance of persons who are familiar with the subject.
No doubt the ultimate decision would rest with Tribunal but since the decision has to be based on proper material it should not, have denied to itself the opportunity of obtaining, the appropriate material.
On this one ground alone the award of the Tribunal with respect to the fixation of targets and the rates of incentive bonus in the various departments will have to be quashed.
For revising the target of 25 lbs.
per day in the steel foundry department the Tribunal had hardly any material before it.
It failed to give due importance to the fact that the original target of 20 lbs.
was raised to 25 lbs.
by the appellant after discussing the matter with the workmen concerned and with their consent.
The Tribunal would do well to remember that though it has power to vary an existing scheme and, therefore, also the targets provided therein, it cannot do so lightly.
Primarily it is the function of the management to fix and ordinarily even, to revise the targets.
No doubt, in exercise of this function the management must consult the workmen concerned.
But where all that has been done and the revised targets are the result of agreement between the management and the workmen there must be good reasons for revising the targets.
What the Tribunal has done with respect to the targets in the 'other productive department is still more unjustified.
As already stated it has fixed the targets in these departments at 50% of the total 671 productive capacity per month in these mills or 50% of the efficiency of the workmen employed.
It has directed that incentive bonus should be calculated at the present rate on the quantum of production in excess of those revised targets.
On the face of it, it would appear to have fixed the targets at very low levels and the result of doing this would be that half or more than half of the total earnings of a workman would come to him by way of incentive bonus without the production going up.
Its scheme, rather than proving as an incentive to production, would virtually be a disincentive.
Speaking about premium systems Florence Peterson in her "Survey of Labour Economics revised edition, has observed at p. 329 : "No matter what name they go by, all premium systems have one distinct characteristic, namely, a guaranteed rate with premium payments for production beyond an established standard.
The standard may be in terms of units of output or units of time, that is, minutes or hours.
The essential distinction in the various incentive systems have to do with (1) the point or level of production at which premiums begin, and (2) the formula used for determining premium rates.
In all premium systems the crucial factor is where the 'task ' or standard ' is set.
The policy adopted can tend towards either of two directions, namely, a strict standard which is difficult to accomplish, with high premiums for better than standard, or a lenient standard with relatively small permiums.
If a very, strict standard is set which can be exceeded 672 only through the best efforts of the most com petent workers, the guaranteed rate tends to become the actual earnings rate for most of the workers.
If, on the other hand, a rela tively easy standard is fixed, the major por tion of the total earnings of most employees on the job will consist of premium wages.
The second fundamental distinction in incentive plans has to do with the formula for the division of gains when above standard production is attained, regardless of whether or not the established standard is high or low.
Increasing the ratio of returns to the worker is obviously done for the purpose of encouraging ever higher production.
Plans providing for a decreasing ratio of returns, or a declining wage curve, are based upon the principle that increased output not only is a result of the workers efforts but is also due to improvement in working conditions for which management is responsible, and that management should therefore 'share ' in the gains. " Bearing in mind these observations and the fact that ordinarily the rate of incentive bonus is correlated to the target it would follow that if the target originally fixed by the employee is very high then the existing incentive bonus payable may well be regarded as having been fixed high.
Whether that is in fact so or not would, however, be a question to be decided by the Tribunal.
In this case the Tribunal without considering this point has directed that incentive bonus should be paid to the workmen in the department concerned at the existing rates even 673 though the targets have been halved.
That direction is pot proper.
On behalf of the workmen Mr. Sharma alleged that the existing targets are fixed so high that for earning incentive bonus the workmen have to sweet.
This contention also needs to be examined by the ,Tribunal. 'Now, since the scheme of incentive bonus already prevails in most of the departments of the company the Tribunal will have the jurisdiction to consider whether the existing scheme is onerous, unrealistic, unreasonable or otherwise.
We would, however, reiterate that the scheme should not be interfered with by the Tribunal unless it comes to the definite conclusion that the targets fixed are so high that an average working with ordinary efficiency can earn only the daily wage but nothing more.
It would render the task of the Tribunal easy if it tries to elicit the requisite information from assessors as well as from others conversant with t6 operations in each department.
Where, after considering the relevant material the Tribunal finds that targets are too high or not reasonably attainable, it will undoubtedly be within its competence to refix them.
But while refixing them it should take care to see that the targets are not so low that the major portion of the total earnings of most employees will consist of incentive bonus.
Thus in revising the scheme prepared by the management the Tribunal has on the one hand to guard the interest of the workmen and prevent what may fairly be called sweating and on the other it has to see to it that the revised targets do not encourage laziness or reduce production to low or uneconomic level.
The Tribunal should further bear in mind that where the targets have been agreed to between the employer and the employees and even though a scheme of incentive bonus has been in operation for some time and the workmen have had experienced of it no complaint has been made by them that the scheme is onerous.
This would be a relevant circumstance to be taken 674 into consideration when a demand is made long, after the scheme has been in force for revision of targets.
Again it must bear in mind the effect on production ascribable to improved techniques or to the installation of improved machinery.
Here the Tribunal has adverted to none of the matters.
To put it mildly, the manner in which the Tribunal 'has dealt with the question is wholly unsatisfactory.
We do not understimate the difficulty presented by the question of fixing of targets.
Perhaps the Tribunal 's s task in this regard would be rendered less difficult if, for instance, it can obtain material from which it could ascertain what the average production in each department was before the introduction of the original scheme and before improved techniques ware introduced and better machinery installed.
In the light of the material before it, the Tribunal should consider whether the old production could safely be accepted as the targets.
We realise that here it is the appellant 's case that the adoption of better techniques and installation of new machinery has made it possible for the workmen to produce more in the same time.
This contention of the appellant needs to be examined.
Here again, expert opinion will be valuable.
If the Tribunal finds that the increase in production is solely ascribable to the innovations made and the workload of the workmen has not been increased, there would be a case for the upward revision of the old targets correspondingly.
A complication will undoubtedly arise where the workload of workmen has increased.
When such is that case the Tribunal will have to bear in mind the fact that workmen are after all human beings and not machines, that they are apt to feel tired if they have to work at a a higher tempo than in the past, that performing mechanical operations over, a over a long period produces not only boredom but also a great strain on the 375 muscular powers of workmen with the result that it produces more fatigu, physical as well as psycho.
logical.
In such a case the revised target must, therefore, be reasonably below the level at which results of these kinds are apt to ensue.
What we have said is not exhaustive of the factors to be borne in mind and it would be open to the Tribunal to bear in mind such other factors as would be relevant in this connection.
The next question which has to be considered is the extension of the scheme for payment of incentive bonus to the clerical and watch and ward staff.
In Burn & Co., Ltd. vs Their workmen (1) this Court hold that from the point of view of economics the clerical and subordinate staff in an industry, like its manual workers, contribute towards its production and there man, therefore, be no reason for excluding them wholly from the benefits of a scheme of incentive bonus.
It was urged before, this Court on the authority of decision in Titaghur Paper Mills case (2) that the introduction of incentive bonus is the function of the management and the Tribunal should not impose a scheme for payment of such bonus on the management.
Dealing with this contention this Court observed "In the present case, however, the incentive bonus scheme has already been introduced by the company for the major part of its workmen and all that is now asked for is that the benefit of the scheme should be extended to the remainder of the workmen." Mr. Viswanatha Sastri has not challenged the correctness of the view taken by this Court in Bum & CO 'S Case.
His main grievance with regard to the direction in the award extending incentive bonus scheme to clerical and watch and (1) , 426.
(2) (1959) SUPP.
2 S.C.R. 1012, 676 ward departments is that if implemented it would entitle these workmen to get in effect 100% bonus or perhaps even more.
There are, as already stated, five productive department% and five indirect productive departments.
Now, if we, take 100 as the rate in each productive department the rate for the five indirect productive departments would be 75 and the total for all the departments would come to 875 and 12 1/2% of that would come to nearly 110 It is possible, as Mr. Sharma suggests that this is not what the Tribunal intended to do and that what it intended was to take the average rate for all the productive and indirect productive departments and give 12 of the average rate as bonus to the workmen of the nonproductive departments.
It may be that that was the intention of the Tribunal but the way in which it has expressed itself leads to the absurd result that the workmen employed in the non productive departments will actually get more incentive bonus than workmen emyloyed in the productive departments : Before, however, coming to the conclusion that the scheme of incentive bonus should be extended to these workmen the Tribunal would do well to ascertain whether a case has been made out by them for grant of incentive bonus.
Indeed one of the grounds which persuaded this Court in Burn & Co 's case (1) to extend the scheme of incentive bonus to the clerical staff was that there was increase in their work in consequence of rise in production.
The Tribunal would do well to ascertain whether in view of the increased production there has been a rise in the workload, if we may use that expression, with regard to nonproductive workmen.
If it finds that the workload has increased they could be held entitled to incentive bonus.
(1) ; , 426.
677 We may further point out that in Burn & co 's case (1) the Tribunal did not proceed to lay down the rate of incentive bonus to the clerical and subordinate staff but merely directed the company to extend the scheme to them and lay down the rates and conditions for those classes of workmen to be entitled to get the incentive bonus.
This Court has impliedly approved this direction.
Indeed, bearing in mind the principle that initially the whole question of incentive bonus involving the fixation of targets, prescribing rates an( lavingly down other conditions is the function of the management, we have no doubt that the course taken by the Tribunal in Burn & CO 's Case (1) was the proper one.
One more question remains to be considered and that is the contenation of Mr. Viswanatha Sastri that no question arises for payment of incentive bonus to piece rate workmen.
His argument is that if a piece rate workman produces more he earns more and, 'therefore, there is nothing more that he is entitled to.
We do not agree.
Even with regard to piece rate workmen there is a norm and if a piece rate workman produces anything beyond that norm he should be entitled to be pail for the excess at a higher rate.
That is what is being done in England and other industrialised countries like the United States and there appears to be no reason why it should not be required to be done in our country.
What the enhanced rate should be would necessarily be a matter to be determined with the assistance of assessors as well as of the company and the workmen.
We would, however, admininister a caution.
The result of prescribing a higher rate for production above the norm should not lead to a glaring disparity between the total actual earnings of an average piece rate workman and of a time rate workman working over the same period of time.
For, a wide disparity may lead to (1) ; ,426.
678 discontent, which is something which must be avoided in the interest of the industry as well as the workmen.
For the reasons stated above we quash the award in so far as it relates to the fixation of targets in the various departments of the appellant, fixation of rate of incentive bonus for time rate workmen as well as piece rate workmen and extension of the scheme to non productive departments and remand the dispute to the Tribunal for adjudication after appointing assessors, considering all relevant material placed before it by the parties to the dispute and make a fresh award in the light of our observations.
The rest of the award is affirmed.
There will be no order as to costs in this appeal.

Output:
The appellant runs a steel mill and there are various departments in the mill which are grouped under three headings.
By agreement between the management and the workmen different production targets and different incentive bonus schemes for different departments have been in force for some time.
The respondent No. 2 on behalf of the work men claimed that incentive bonus scheme at present in force should be revised so as to cover those categories of workmen who are at present out of it.
It was further claimed that the present targets of production should be refixed and brought to the 1948 level.
On the failure of the parties to come to a settlement the Government referred the matter to the Industrial Tribunal for adjudication.
The Tribunal by its award directed the revision of production targets in certain departments.
With regard to the claim for extension of the scheme to the clerical and Watch and Ward Staff and the workmen in the shopping depart ment the Tribunal awarded the extension at certain specified rates.
The claim for revision of the rates of bonus in the indirect productive department was rejected.
The Tribunal also rejected the claim of the workmen that the rates of production bonus to all catagoriesd of workmen should be made uniform.
The appellants thereupon appealed to this Court by way of special leave.
The main question raised in the appeal was whether the Tribunal had jurisdiction to refix the production targets as well as the rates of incentive bonus.
A further question raised was whether piece rate workmen are entitled to incentive bonus.
The appellants made a grievance of the fact that their request to appoint assessors for giving opinion on technical matters was rejected by the Tribunal.
They also alleged that the Tribunal had no adequate data before it to determine the proper production targets.
661 Held, that the Tribunal ought to have borne in mind the fact that for the determination of technical matters it is always desirable to have the assistance of persons who are familiar with the subject and it should not deny to itself the opportunity of obtaining the appropriate material.
While it is the function of the management whether or not to introduce a scheme of incentive bonus, once such a scheme is introduced the Industrial Tribunal has jurisdiction to vary the scheme including the rates of bonus.
But the scheme should not be interfered with lightly.
The Tribunal is entitled to consider whether the scheme is erroneous, unrealistic or unreasonable.
Where after consideration of relevant materials the Tribunal finds the targets are too high it can refix them.
But it should also see that the targets fixed are not too low.
Held, also, that piece rate workmen are entitled to be paid at a higher rate for the excess they have produced beyond a norm.
But in fixing the higher rate care should be taken to avoid glaring disparity between the total earnings of an average piece rate worker and of a time rate workman working over the same period.


Input:
ivil Appeal Nos.
2809 2812A of 1986.
From the Judgment and Order dated 6.2.1986 of the Alla habad High Court in Civil Misc.
W.P. Nos. 2274, 2983, 3860, 4558 and 3202 of 1984.
Rajinder Sachher and Bharat Sanghal for the Appellants.
Harbans Lal, Dr. Meera Agarwal, R.C. Misra and Arun Madan for the Respondents.
The Judgment of the Court was delivered by section RATNAVEL PANDIAN, J.
These five appeals by Special Leave under Article 136 of the Constitution of India are preferred against the Judgment and Or, let dated 6.2.86 passed by the Allahabad High Court in Civil Misc.
Writ Petition No. 2274/84 connected with Civil Misc.
Writ Peti tion Nos.
2983/84, 3860/84, 4558/84 & 3202/84 directing the respondents (appellants herein) to re determine the cost of the appellants ' (respondents herein) flats and instalments payable by them after hearing their grievances.
Since identical contentions are urged in all the ap peals, we are rendering a common judgment.
As it is said that Civil Appeal No. 2809/86 arising out of Civil Misc.
Writ Petition No. 2274/84 is more comprehen sive and the facts alleged therein may be taken as represen tative in character, the facts relating to this appeal are briefly stated.
The Bareilly Development Authority (hereinafter re ferred.
as 'BDA '), the first appellant was constituted under Section 4 of the U.P. Urban Planning and Development Act, 1973 by the State Government 747 for the purposes of development in the District of Bareilly., With a view to casing the acute housing problem in the said District, the BDA has undertaken construction of dwelling units for people belonging to different income groups styled as 'Lower Income Group ', 'Middle Income Group ', 'High Income Group ' and the 'Economically Weaker Sections ' (hereinafter referred as LIG, MIG, HIG and EWS respectively).
The BDA issued ' an advertisement offering to register names of intending applicants desirous of purchas ing dwelling houses/flats in any one of the different income groups intended to be constructed by the BDA.
In this appeal i.e. Civil Appeal No. 2809/86, the respondents 1 to 17 and 20 got themselves registered for allotment of flats in MIG scheme and respondents 18 and 19 in HIG scheme with the BDA in accordance with the terms and conditions contained in the brochure issued by the Authority.
The following table of the brochure shows the necessary details inclusive of the esti mated cost for the different types of flats under various categories: Type of Range of Cost Initial Interest Approx House Income payment monthly instalment MIG Rs. 1000 to Rs.64,000 Rs.5000 12% Rs.551 p.m. for Rs. 1500 p.m. 15 yrs.
HIG Rs. 1500 and Rs. 1, 15,000 Rs.7000 12% Rs. 1440 above p.m. p.m. for 10 yrs.
LIG Rs.351 to Rs.35,000 Rs.2000 11% Rs.345 p.m. for Rs. 1000 p.m. 15 yrs.
EWS Rs.350 p.m. Rs. 11,000 Rs, 100 7% Rs.89 p.m. for 20 yrs.
The note under the 'General Information Table ' given in the said brochure states that the cost shown therein is only estimated cost and it would increase or decrease according to the rise or fail in the price at the time of completion of the houses/flats.
All the respondents registered.their names ' for MIG, HIG and 748 EWS flats as the case may be and made the initial deposit.
Thereafter, the respondents in MIG group received indentical notices dated 19/20.1.84 from the Secretary, Bareilly Devel opment Authority (second appellant) intimating that the revised cost of houses/flats of MIG group as well as the amount of monthly instalment would be as follows: 1.
No. of houses available 77 2.
Cost of the house Rs. 1,27,000 3.
Down payment to be made/ Rs.35,000 paid on allotment 4.
No. of monthly instalment 180 fixed for the payment of remaining amount 5.
Rate of yearly interest 13.5% 6.
Amount of monthly instalment Rs. 1,031.50 with interest.
By the said notice, the respondents in MIG group were informed that 40% of the houses/flats mentioned in the notice would be given to the allottees who would deposit the entire cost in one cash payment and that the other allottees who intend to buy houses/flats on the above revised price/instalments must send by 28.1.84 their written accept ance on the annexed proforma to the Registration Section of the office of the BDA otherwise their claims would not be included in the lots to be drawn on 31.1.1984.
Except the respondents Nos. 13, 17, 18 and 20, all other respondents in reply to those notices gave their unequivocal and uncondi tional written consent.
Hence their names were included in the draw and on being lucky in the draw, the respondents barring the above 4 were allotted their respective houses.
After allotment, they were asked to complete the other formalities and make down payments in accordance with the notice.
dated 19/20.1.1984, by a further notice dated 3.2.1984 (Annexure 'F ').
Similar notices were issued to all the registered allottees for all types of houses and the respondents were also intimated that in case any of the registered persons does not want to purchase the house, his name would not be included in the draw but he would have his choice later on.
749 At this stage, all the respondents in these appeals approached the High Court under Article 226 of the Constitu tion of India challenging the revised terms and conditions of the BDA on the ground that the petitioners were estopped from changing the conditions subject to which the respond ents applicants had applied for registration and deposited the initial payment in the year 1980; that the enhancement of cost of the house/flat amounting almost double of the estimated cost as shown in the brochure while inviting the applications and the increase of the monthly instalments are much beyond the means of the respondents and that this arbitrary and unilateral stand of the petitioners is to the prejudice of the respondents.
On the above contentions, the respondents prayed in their respective petitions for issue of writ of mandamus directing the petitioners to maintain the allotment of the flats in their favour on the original terms and conditions, to hand over the possession of the same and further to restrain the petitioners from cancelling the original allotment.
The above plea was resisted by the petitioners strongly relying on certain conditions contained in the brochure especially of clauses 12 and 13 as per which the BDA has reserved its discretion to change, alter or modify any of the terms and/or conditions of the allotment given in the brochure; that its decision would be final with regard to any matter concerning the registration and allot ment and that the BDA has right to relax any condition in its discretion.
It has been further contended that respond ents barring 13, 17, 18 and 20 have given their written acceptance to the changed conditions as mentioned in the notice dated 19/20.1.1984 and as such they are not entitled to the reliefs claimed in the writ petition.
According to the petitioners the increase in the cost and the interest demanded from the respondents is neither arbitrary nor unreasonable and the High Court is not the proper forum for examining in detail the terms regarding payment of instal ments in the circumstances of the present case, and if the respondents were not agreeable to the changed terms and conditions, they could as well resile from their consent.
Finally, it was contended that the respondents are estopped from challenging the varied terms and conditions of the allotment after having consented.
The High Court though repelled the contention of the respondents (allottees) based on the principle of promissory estoppel, made the following observations with regard to the case of the respondents in the MIG category: "In the circumstances of the present case the fixation of monthly instalment to the tune of Rs.1031.50 from the 750 petitioners of MIG group whose income is hardly Rs. 1500 per month appears to us smack ing of arbitrariness and unreasonableness on the part of the contesting opposite party (petitioners herein)"; "In the circumstances of the present case, we are not satisfied that the contesting opposite party has succeeded in establishing its demand of double the estimated cost by facts and figures.
The end of justice demands that the authority should refix the cost of the peti tioner 's flats after hearing their grievance.
" The High Court answered the objections taken by the petitioners herein that the respondents have consented for the changed terms and conditions observing, "We think that the consent obtained from the petitioners was also not reasonable act on the part of the contesting opposite par ties (appellants herein)".
Finally, the High Court adopting the above reasoning in respect of the cases of other re spondents also falling under various categories directed the appellants herein in all the writ petitions "to re determine the cost of the petitioners ' (respondents herein) flats and instalments payable by them after heating their grievances." Being aggrieved by the impugned judgment the appellants have filed these appeals by special leave.
Shri Rajinder Sachher, St. Adv.
after taking us through the relevant documents and the additional affidavit filed by the second respondent and the reply affidavit assailed the reasonings given by the High Court contending that the said Court has erroneously held that the BDA has failed to justi fy the demand of the enhancement in the cost of houses/flats as well as the increase of the monthly instalments in dis proportionate to their income, because the income of the applicant was relevant only to determine the category of the scheme in which the applicant had to be included for eligi bility to get a house/flat under the scheme but not for enhancement of the cost of the houses/ flats and monthly instalments.
According to him since the declared policy of the BDA being 'No Profit No Loss ', it had fixed the cost of the houses/flats and the rate of instalments after taking into consideration of the escalation of the building materi al, labour charges, cost of transport and the allied valu able factors which all enter into the price fixation, and as such the High Court is not correct in going into the ques tion of computation of cost of the construction of houses/flats and 751 the plea of clerical mistakes exercising its jurisdiction under Article 226 of the Constitution of India.
He further submits that the High Court has gone wrong in importing the principle laid down in Ramana Dayaram Shetty vs The Interna tional Airport Authority of India & Ors., AIR 1979 Supreme Court 1628 to the present facts and circumstances of the case in view of the fact that in price fixation the execu tive has a wide discretion and it is only answerable provid ed there is any statutory control over its policy of price fixation and it is not the function of the High Court to sit in judgment over such matters of economic policy.
It has been vehemently urged that after the parties have entered into the field of ordinary contract, the relations are no longer covered by the constitutional provisions but by the legally valid contract which determines the rights and obligations of the parties inter se.
The fact that all respondents had applied for registra tion only on acceptance of terms and conditions contained in the brochure inclusive of Clauses 12 & 13 as well as the conditions mentioned in the Notes 1 and 2 of the 'General Information Table ' of the said brochure, and further the respondents barring respondents Nos. 13, 17, 18 and 20 in MIG group gave their reply accepting the changed terms and conditions as per letter dated 19/20.1.1984 cannot be chal lenged in view of the unassailable documentary evidence namely Annexures 'A ', 'D ', 'E ' and 'F '.
Now, we shall reproduce some of the relevant conditions of the brochure as well as the changed conditions contained in the letter dated 19/20.1.1984.
Clauses 12 and 13 of the brochure issued by the BDA and the notes 1 and 2 of the General Information Table thereto read thus: Clause 12 For allotment by lottery all the above men tioned terms and rules given in the booklet would ordinarily be followed but the Develop ment Authority will have the right to change, enhance or amend any of the terms and/or condition as and when it thinks necessary and at its discretion.
Clause 13 The decision of the Development Authority in regard to any matter in relation to the regis tration application will be final.
It would have the right to relax any of the conditions at its discretion.
The fight to sell by auc tion the Middle 752 Income Group and Higher Income Group plots/houses or any portion thereof, of the various schemes, will also vest in the Devel opment Authority.
General Information Table Note: (1) The cost shown in the column 4 is only estimated cost.
It will increase or decrease according to the rise or fall in the price at the time of completion of the property.
Note: (2) The data given in the above mentioned table can be amended as felt neces sary.
The last paragraph of the letter dated 19/20.1.84 (Annexure 'D ') reads thus: "If you want to buy the house on the above price/instalment then you must send by 28.1.1984 your written acceptance on the annexed proforma to the Registration Section of this office.
" It may be mentioned here that in this letter (Annexure 'D '), the BDA has informed the allottees of MIG about the enhancement of the cost of the houses/flats as well as the increase of the monthly instalment and the rate of yearly interest etc.
and requested the allottees to give their written acceptance so that their names could be included in the list.
The respondents except the four above have sent their written acceptance to the letter (Annexure 'D ').
For a better appreciation of the case of the appellants, we think that as an example the letter (Annexure 'E ') of the first respondent in this case namely Shri Ajay Pal Singh may be reproduced: "I, Ajay Pal Singh, S/o Shri Sujan Singh want to take a Middle Income Group house in the Housing Scheme No. 2 situated at Tibrinath of the Bareilly Development Authority on payment by instalment.
I have seen the house and am satisfied.
I accept the rules of the Bareilly Development Authority.
" 753 Only on the basis of the written acceptance, the name of the first respondent was included in the draw and he has successful in getting the allotment of House No. 37 in MIG type which fact if clearly borne out by the letter from the second respondent (Annexure 'F ').
In this connection, it is worthwhile to note that the first respondent, Shri Ajay Pal Singh is the Principal of Shri Guru Govind Singh Inter College and his educational qualifications are M.A. (Econ. & Hist.), B.Sc., B.Ed., LL.B.
From the above, it is clear that all the respondents who have sent their applications for registration with initial payment only after having fully understood the terms and conditions of the brochure inclu sive of the Clauses 12 and 13 and Notes 1 and 2 of the General Information Table as per which the BDA has reserved its right to change, enhance or amend any of the terms and/or conditions as and when felt necessary, and also the right to relax any of the conditions at its discretion, and that the cost shown in the column 4 of the brochure was only estimated cost subject to increase or decrease according to the rise or fail in the price at the time of completion of the property.
This is not only the case of the applicants of MIG scheme but also of the other applicants falling under the other categories i.e. HIG, LIG and EWS.
So it cannot be said that there was a mis statemennt or incorrect statement or an fraudulent concealment in the information supplied in the brochure published by the BDA on the strength of which all the applicants falling under the various categories applied and got their names registered.
In such a circum stance the respondents cannot be heard to say that the BDA has arbitrarily and unreasonably changed the terms and conditions of the brochure to the prejudice of the respond ents.
More so, the respondents barring respondent Nos. 13, 17, 18 and 20 after having given their written consent accepting the changed and varied terms and conditions as shown in the letter dated 19/20.1.84 are not justified in contending that the BDA has gone back on its original terms ' and conditions and has substituted new conditions to their detriment.
It is quite un understandable that the persons like the first respondent who is highly educated, occupying the post of the Principal of a College and who has accepted the changed terms and conditions by his letter is making these allega tions against the BDA.
The respondents were under no obligation to seek allot ment of houses/flats even after they had registered them selves.
Notwithstanding, they voluntarily registered them selves as applicants, only after fully understanding the terms and conditions of the brochure inclusive of Clauses 12 and 13 and Notes 1 and 2 of the General Information 754 Table which we have reproduced above, they are now trying to obtain the houses/flats at the price indicated in the bro chure at the initial stage conveniently ignoring the other express conditions by and under which the BDA has reserved its right to change the terms and conditions as and when felt necessary, evidently depending upon the escalation of the prices.
One should not loose sight of the fact that the BDA did not compel anyone of the applicants to purchase the flat at the rates subsequently fixed by it and pay the increased monthly instalments.
On the contrary, the option was left over only to the allottees.
In fact, the respond ents in Civil Appeal No. 2809 of 1986 except the four above mentioned have unconditionally accepted the changed terms and conditions.
Thus the factual position in this case clearly and unambiguously reveals that the respondents after voluntarily accepting the conditions imposed by the BDA have entered into the realm of concluded contract pure and simple with the BDA and hence the respondents can only claim the right conferred upon them by the said contract and are bound by the terms of the contract unless some statute steps in and confers some special statutory obligations on the part of the BDA in the contractual field.
In the case before us, the contract between the respondents and the BDA does not con tain any statutory terms and/or conditions.
When the factual position is so, the High Court placing reliance on the decision in Ramana Dayaram Shetty case ; has erroneously held: "It has not been disputed that the contesting opposite party is included within the term 'other authority ' mentioned under Article 12 of the Constitution.
Therefore, the contesting opposite parties cannot be permitted to act arbitrarily with the principle which meets the test of reason and relevance.
Where an author ity appears acting unreasonably this Court is not powerless and a writ of mandamus can be issued for performing its duty free from arbitrariness or unreasonableness.
" This finding, in our view, is not correct in the light of the facts and circumstances of this case because in Ramana Dayaram Shetty case there was no concluded contract as in this case.
Even conceding that the BDA has the trap pings of a State or would be comprehended in 'other authori ty ' for the purpose of Article 12 of the Constitution, while determining price of the houses/flats constructed by it and the rate of monthly instalments to be paid, the 'authority ' or its agent after 755 entering into the field of ordinary contract acts purely in its executive capacity.
Thereafter the relations are no longer governed by the constitutional provisions but by the legally valid contract which determines the rights and obligations of the parties inter se.
In this sphere, they can only claim rights conferred upon them by the contract in the absence of any statutory obligations on the part of the authority (i.e. B.D.A. in this case) in the said contractual field.
There is a line of decisions where the contract entered into between the State and the persons aggrieved is non statutory and purely contractual and the rights are governed only by the terms of the contract, no writ or order can be issued under Article 226 of the Constitution of India so as to compel the authorities to remedy a breach of contract pure and simple Radhakrishna Agarwal & Ors.
vs State of Bihar & Ors.
, ; ; Premji Bhai Parmar & Ors. etc.
vs Delhi Development Authority & Ors, ; and D.F.O. vs Biswanath Tea Company Ltd., In view of the authoritative judicial pronouncements of this Court in the series of cases dealing with the scope of interference of a High Court while exercising its writ jurisdiction under Article 226 of the Constitution of India in cases of non statutory concluded contracts like the one in hand, we are constrained to hold that the High Court in the present case has gone wrong in its finding that there is arbitrariness and unreasonableness on the part of the appel lants herein in increasing the cost of the houses/flats and the rate of monthly instalments and giving directions in the writ petitions as prayed for.
For the reasons hereinbefore stated, we set aside the judgment of the High Court and accordingly allow all the appeals.
There will be no order as to costs.
Before parting with the judgment, we would like to observe that it is open to the respondents to approach the appellants for correction of any clerical mistakes in the calculation, if any and they are at liberty to move any proper authority for any remedy if they are otherwise legal ly entitled to.
P.S.S. Appeals al lowed.

Output:
The appellant Authority offered to register names of intending applications desirous of purchasing LIG, MIG, HIG and EWS type houses/flats.
The 'General Information Table ' given in the brochure indicated the type of houses, corre sponding income groups, cost, initial payment to be made, rate of interest and approximate monthly instalments.
Note (1) under the said table stated that the cost shown therein was only estimated cost and it would increase or decrease according to the rise or fail in the price at the time of completion of the houses, while Note (2) stated that the date given therein could be amended as felt necessary.
By clauses 12 and 13 contained in the brochure the Authority reserved its discretion to change, alter or modify any of the terms and/or conditions of the allotment as and when necessary.
All the respondents registered their names for allotment of the flats in accordance with the terms and conditions in the brochure and made the initial deposit.
Subsequently, they received notices from the Authority intimating the revised cost of houses and the amount of monthly instalment rates which were almost double of those initially stated in the 'General Information Table '.
The respondents were fur ther informed that those who intend to buy houses on the revised price/instalments must send their written acceptance by the date specified other wise their claims would not be included in the lots to be drawn.
Except a few, all other respondents gave their unequivocal and unconditional written consent.
Hence their names were included in the 743 744 draws and on becoming lucky in the draw, they were allotted their respective houses.
At this stage.
all the respondents approached the High Court under Article 226 of the Constitution challenging the revised terms and conditions on the ground that the appel lants were estopped from changing the conditions subject to which the respondents had applied for registration and deposited the initial payment, that the enhancement of cost of the house amounting to almost double of the estimated cost as shown in the brochure and the increase of the month ly instalments were much beyond their means and that this arbitrary and unilateral stand of the appellants was to the prejudice of the respondents.
These petitions were resisted by the appellants by contending that the respondents were estopped from challenging the varied terms and conditions of the allotment after having consented.
The High Court found the action of the Authority in fixing the revised cost and instalments arbitrary and unrea sonable and directed the appellant Authority to re determine the cost of the flats and instalments payable by them after hearing the parties.
In these appeals by special leave it was contended for the appellant Authority that the income of the applicants was relevant only to determine the category of the scheme in which they had to be included for eligibility to get a house under the scheme but not for enhancement of the cost of the house and monthly instalments, that it had fixed the cost of the houses and the rate of instalments after taking into consideration the escalation in the price of building mate rial, labour charges, cost of transport and allied valuable factors which all enter into the price fixation, that in price fixation the executive has a wide discretion and it is only answerable provided there is any statutory control over its policy of price fixation, and that after the parties had entered into the field of ordinary contract, as in the instant case.
the relations were no longer covered by the constitutional provisions but by the legally valid contract which determines the rights and obligations of the parties inter se Allowing the appeals, HELD: 1.
Where the contract entered into between the State and the persons aggrieved is non statutory and purely contractual and the rights are governed only by the terms of the contract, no writ or order can be issued under Article 226 of the Constitution of India so as 745 to compel the authorities to remedy a breach of contract pure and simple.
[755C] Radhakrishna Agarwal & Ors.
vs State of Bihar & Ors.
, ; ; Premji Bhai Parmar & Ors. etc.
vs Delhi Development Authority & Ors. ; and D.F.O.v.
Biswanath Tea Company Ltd., referred to.
The respondents in the instant case had voluntarily registered themselves as applicants only after fully under standing the terms and conditions of the brochure, inclusive of cls.
12 and 13 and Notes 1 and 2 of the General Informa tion Table under which the Authority had reserved its right to change the terms and conditions as and when felt neces sary evidently depending upon the escalation of the prices.
The Authority did not compel anyone of the applicants to purchase the flat at the rates subsequently fixed by it and pay the increased monthly instalments.
On the contrary the option was left over only to the allottees.
All the same, the respondents gave their written consent unconditionally accepting the changed and varied terms and conditions.
[753H;754A C] The respondents after accepting the conditions imposed by the Authority had thus entered into the realm of a con cluded contract pure and simple with the Authority and hence they could only claim the right conferred upon them by the said contract and were bound by the terms of the contract unless some statute stepped in and conferred some special statutory obligations on the part of the Authority in the contractual field.
The contract between the respondents and the Authority did not contain any statutory terms and/or conditions.
[754C E] Even conceding that the Authority had the trappings of a State or would be comprehended in 'other authority ' for the purpose of Article 12 of the Constitution, while determining price of the houses flats constructed by it and the rate of monthly instalments to be paid, the 'authority ' or its agent after entering into the field of ordinary contract had acted purely in its executive capacity.
Thereafter the relations were no longer.
governed by the Constitutional provisions but by the legally valid contract which determined the rights and obligations of the parties inter se.
In this sphere, they could only claim rights conferred upon them by the contract in the absence of any statutory obligations on the part of the Authority in the said contractual field.
[754G H; 755A B] Ramana Dayaram Shetty vs The International Airport Authority 746 of India & Ors., ; The High Court while exercising its jurisdiction under Article 226 of the Constitution had, therefore, gone wrong in its finding that there was arbitrariness and unreasona bleness on the part of the appellants in increasing the cost of the houses/flats and the rate of monthly instalments, and giving directions in the writ petitions as prayed for.
[755D E]


Input:
ition No. 3050 of 1980.
(Under Article 32 of the Constitution) A. section Sohal and M. C. Dhingra for the Petitioner.
M. M. Abdul Khader, N. Nettar and M. N. Shroff for the Respondents.
The Judgment of the Court was delivered by KRISHNA IYER, J.
Who will police the police ? Is freedom of movement unreasonably fettered if policemen are given power of externment for public peace? These twin problems of disturbing import, thrown up by this bizarre case, deserve serious examination.
The former is as important as the latter, especially when we view it in the strange police setting painted by the petitioner.
The constitutional question, which we will state presently and discuss briefly, has become largely otiose so far as the present petitioner is concerned because counsel for the State has assured the court that they will drop police surveillance or any action by way of externment as proposed earlier.
The police methodology, with sinister potential to human liberty described by the petitioner, if true, deserves strong disapproval and constitutional counter action by this Court.
But before committing ourselves to any course, we must set out the factual matrix from which the present case springs.
The statutory starting point of the criminal saga of Shri Prem Chand Paniwala, the petitioner, now threatened with externment proceedings, is the .
Sections 47 and 50 of the said Act clothe the Commissioner of Police with externment powers necessary for keeping the capital city crime free.
One such power relates to the removal of persons about to commit offences.
The procedural prescriptions and substantive directions, in this behalf, are laid down in the above provisions.
The Deputy Commissioner of Police (the DCP for short) in exercise of the said power, 1264 initiated proceedings against the petitioner and directed him to show cause why he should not be externed from the Union Territory of Delhi.
Paniwala who, from humble beginning as vendor of aerated water near a cinema theatre, had spiralled up into a prosperous dealer in Vasant Vihar, when confronted by this Police notice, decided upon a constitutional show down and came to this Court challenging the vires of the externment proceedings as arbitrary and unreasonable restrictions of his freedom of movement and, therefore, contrary to articles 14 and 19 and 21 of the Constitution.
The validity of the action, assuming the vires of the Act, involves also a consideration of the mala fides imputed by the petitioner to the DCP.
The blow of deportation may fall heavy on his fundamental rights admits of no doubt.
A flourishing businessman, happy with his wife and children, and settled in a comfortable locality in Delhi, if transported traumatically outside the Union Territory would surely suffer not merely financial mayhem, but also social, domestic and physical deprivation virtually amounting to economic harakiri an psychic distress.
Nevertheless, the Act permits externment, provided the action is bona fide.
All power, including police power, must be informed by fairness if it is to survive judicial scrutiny.
Cases are legion which leave one ill no doubt that mala fides is fatal, if it is made out.
From this angle, Prem Chand Paniwala has turned the focus on police malpractice vis a vis his own career; and even if a fragment of what he has said be true, the higher officers of the Delhi Police will need to look into the goings on at the lower level.
Here comes the relevance of autobiographical revelations made by the petitioner in more than one affidavit.
Certain facts emerge as fairly probable from the affidavits of both sides.
Prem Chand made a living as a paniwala or vendor of soft drinks near Delite Cinema even as a teenager, which shows that he had very poor beginnings.
How did he fall into the thraldom of the local police? He explains it in his affidavit: "He had a few mobile carts which were used for refrigerating water.
These carts used to be parked by the petitioner on the road side due to the indulgence of the police.
He was in his teens when he started his avocation and continued for a very long time.
Thus, he acquired an alias i.e. Prem Chand Paniwala.
Due to close association with Police and their connivance and indulgence, the petitioner thrived.
In this process, the petitioner became a prey and pawn in the hands of the police.
He was persuaded to be their perpetual stooge and stock witness.
1265 The Petitioner in the year 1965, when he was 25 years old was involved in a gambling case by the police and to mould him a permanent stock witness and lest he should be militant to defy them.
Despite his hesitation and unwillingness he was forced to become a permanent pawn of the police.
This is how, the petitioner landed himself in the web of the police; he had no alternative than to be like that as his livelihood was dependent upon the mercy and indulgence of the police".
The version of the petitioner is that once he yielded to the pressure of the Police to give false testimony disclosing a rubberised conscience and unveracious readiness to forswear himself, there was escalation of demands upon him and he became a regular pedlar of perjury "on police service".
Indeed, counsel for the petitioner argued that his client was a 'stock witness ' because he had to keep the Police in good humour and obliged them with tailored testimony in around 3,000 cases because the alternative was police wrath.
We were flabbergasted at this bizarre confession but to lend credence to his assertion counsel produced a Few hundred summonses where the petitioner was cited as a witness.
Were he not omnipresent how could he testify in so many cases save by a versatile genius for loyal unveracity? For sure, the consternation of the community at this flood of perjury will shake its faith in the veracity of Police investigation and the validity of the judicial verdict.
We have no doubt that the petitioner, who has given particulars of a large number of cases where he had been cited as witness, is speaking the truth even assuming that 3,000 cases may be an exaggeration.
In Justice, Justices and Justicing and likewise in the Police and Policing, the peril to the judicial process is best left to imagination if professional perjurers like the self confessed Paniwala are kept captive by the Police, to P be pressed into service for proving "cases".
Courts, trusting the Police may act on apparently veracious testimony and sentence people into prison.
The community, satisfied with such convictions, may well believe that all is well with law and order.
We condemn, in the strongest terms, the systematic pollution of the judicial process and the consequent threat to human rights of innocent persons.
We hope that the higher authorities in the Department who, apparently, are not aware of the nefarious goings on at the lesser levels will immediately take measures to stamp out this unscrupulous menace.
The reason why the petitioner has divulged his role as professional perjurer for the Police is simple and credible, at this price, the favours of the Police who allowed him to carry on his soft drinks business on the public street near a cinema house, not otherwise 1266 permissible under the law.
The Police blinked at the breach, the petitioner made good profits and by this mutual benefit pact, the prosecution got readymade evidence and Paniwala joined the nouveu riche.
He became respectable when he became rich and when he became respectable he became reluctant to play 'stock witness '.
For "the more things a man is ashamed of the more respectable he is" (Bernard Shaw).
Whenever he resisted the demand for giving false evidence the Police implicated him in some case or other and when he yielded, the case was allowed to lapse.
Indeed, it is surprising that the petitioner himself admits that he was "dubbed as a stock witness and often disbelieved by the courts.
Despite severe strictures passed by the courts, the Police did not give him up.
" Various details are furnished by the petitioner about his deposing on prosecutions for the survival of his business.
In the bargain, the petitioner acquired two houses in important localities and built up a lucrative fruit juice business.
There are more uncomplimentary revelations made in the petition but we do not think it necessary to set them out.
However, the crisis came when he declined to oblige with perjury since he felt his wealthy station in life and the character building stage of his children warranted giving up the profession of stock witness.
The Police avenged themselves by initiating externment which would inflict mortal economic injury, if carried out.
This version of the petitioner has been, in a way, denied.
It is also true that the Assistant Commissioner, in his affidavit in reply, has indicated that witnesses have been examined in support and in opposition of the allegations justifying externment and a final order has been made by the DCP directing the petitioner "to show good conduct for a period of three months only".
It is also stated that the witnesses were examined in camera, that the DCP had consideration for the materials placed before him "including education of his children etc.
and the assurance given by him".
An intelligent reading of the affidavit of the Assistant Commissioner, along with the vagueness in his denials regarding material particulars in the petitioner 's affidavits, leave us in grave doubt about the validity of the Police proceedings.
It is significant to notice that among the allegations against the petitioner are such vague statements as your activities in the area of Police Station Connaught Place and other area adjoining to the Police Station Connaught Place are causing and are calculated to cause harm, alarm and danger to the residents of the said localities and areas.
While we do not delve into details, it is useful to mention that the Police allegations are again vague in respect of the remaining imputations namely: 1267 "That you keep knife with you for unlawful purpose and threaten the persons residing in the area with dire consequences and further deter them from making report to police.
That you have engaged yourself in commission of offences against person and property attended with force and violence for which the following cases were registered against you by the Police. ".
The petitioner 's reply affidavit makes startling disclosures about the police methods of implicating innocent people.
However, the version of the petitioner can hardly be swallowed since he is a self confessed perjurer.
Nevertheless, it is not too much to ask Government to take effective measures to prevent Police methods straying into vice.
We hopefully remind the State about what Justice Brandieis once observed : "Crime is contagious.
If the government becomes a law breaker, it breeds contempt for law." . "TO declare that in the administration of the criminal law the end justifies the means to declare that the government may commit crimes in order to secure the conviction of a private criminal would bring terrible retribution.
Against that pernicious doctrine this court must resolutely set its face.
" In the same American decision we have just mentioned Justice Holmes observed; "We have to choose, and for my part I think it a less evil that some criminals should escape than that the Government should play an ignoble part.
" The provisions of the statute ostensibly have a benign purpose and in the context of escalation of crime, may be restrictions which, in normal times might appear unreasonable, may have to be clamped down on individuals.
We are conscious of the difficulties of detection and proof and the strain on the police in tracking down criminals.
But fundamental rights are fundamental and personal liberty cannot be put at the mercy of the Police.
Therefore, Ss. 47 and 50 have to be read strictly.
Any police apprehension is not enough.
Some ground or other is not adequate.
There must be a clear and present danger based upon credible material which makes the movements and acts of the person in question alarming or dangerous or fraught with violence.
Likewise, there must be sufficient reason to believe that the person proceeded against is so desperate and dangerous that his mere presence in Delhi or any part thereof is hazardous to the community and its safety.
We are clear that the easy possibility 1268 of abuse of this power to the detriment of the fundamental freedoms of the citizen persuades us to insist that a stringent test must be applied.
We are further clear that natural justice must be fairly complied with and vague allegations and secret hearings are gross violations of article 14, 19 and 21 of the Constitution as expounded by this Court in Maneka Gandhi.
We do not go deep into this question for two reasons: there is another petition where the constitutionality of these identical provisions is in issue.
Secondly, the counsel for the State has fairly conceded that no action will now be taken even by way of surveillance against the petitioner.
In an age when electronic surveillance and mid night rappings at the door of ordinary citizens remind us of despotic omens, we have to look at the problem as fraught with peril to constitutional values and not with lexical Laxity or literal liberality.
Having made these observations, we leave the question of vires open for final investigation, if necessary, in other cases pending before this Court.
We think counsel for the State was right in representing that no further action would be taken against the petitioner.
We dispose of the petition as calling no longer for directions but emphasise the need of the State to issue clear orders to the Police Department to free the processes of investigation and prosecution from the contamination of concoction through the expediency of stockpiling of stock witnesses.
To police persons who get rich quick by methods not easily or licitly understandable, is perhaps a social service.
Among the list of wanted persons must be not only the poor suspects but the dubious rich.
To keep an eye on their activities without close shadowing and surveillance may, perhaps, lead to criminal discoveries, if they are not too influential for the police.
By this judgment what we mean is not to tell the Police to fold up their hands and remain inactive when anti social elements suddenly grow in wealth but to be activist and intelligent enough to track down those who hold the nation 's health, wealth, peace and security in jeopardy.
The only insistence is that the means must also be as good as the ends.
P.B.R. Petition allowed.

Output:
Exercising power under sections 47 and SO of the (which clothe the Commissioner of Police with externment powers for keeping the capital city free of crime) the Deputy Commissioner of Police Delhi directed the appellant to show cause why he should not be externed from the Union Territory of Delhi.
The allegations against him were that his activities in the area of police station Connaught Place and the areas adjoining the police station were causing and were calculated to cause harm, alarm and danger to the residents of the said localities and areas that he kept a knife with him for unlawful purposes and threatened residents of that area with dire consequences and deterred them from reporting to the police and that he had engaged himself in the commission of offences against persons and property with force and violence.
In his petition under Article 32 of the Constitution challenging the vires of the externment proceedings as arbitrary and unreasonable restrictions on his freedom of movement, the petitioner stated that over the past 25 years with the indulgence of the local police he used to park his mobile refrigerated water carts on the road side in front of a cinema theatre in Delhi and that in return for the indulgence shown to him by the police and to keep them in good humour he yielded to their pressure and gave false testimony in as many as 3000 cases.
Even though Courts had dubbed him as a stock witness and passed severe strictures and disbelieved his testimony, the police did not give him up; that he had to continue to act as a tool in their hands for the survival of his business and that lately when he declined to oblige them because he felt that his wealthy station in life and the character building stage of his children warranted giving up the profession of stock witness, the police avenged themselves by threatening externment which would inflict mortal economic injury to him if the threat was carried out.
The Assistant Commissioner of Police in reply had stated that before the externment order was passed witnesses had been examined in camera in support and in opposition of the allegations justifying externment and that on a consideration of the materials placed before the Deputy Commissioner of Police, including the education of his children and the assurance given by the petitioner, final order had been passed directing him to show good conduct for a period of 3 months.
Allowing the petition, ^ HELD: The permits externment provided the action is bona fide.
All power, including police power, must be informed by fairness, if it is to survice judicial scrutiny.
Mala fides is fatal if it is made out.
[1164 D E] 1263 Sections 47 and 50 of the Act have to be read strictly; any police apprehension is not enough; some ground or other is not adequate; there must be a clear and present danger based upon credible material which makes the movements and acts of the person in question alarming or dangerous or fraught with violence.
Like wise there must be sufficient reason to believe that the person proceeded against is so dangerous that his mere presence in Delhi or any part thereof is hazardous to the community and its safety.
A stringent test must be applied by Courts in order that this power is not abused to the detriment of the citizen Natural justice must be fairly complied with and vague allegations such as those levelled against the petitioner and secret hearings are gross violations of Articles 14, 19 and 21.
[1267 G H,