Input:
Appeal No. 2108 of 1966.
Appeal from the judgment and decree dated January 15, 1965 of the Allahabad High Court, Lucknow Bench in Special Appeal No. 82 of 1963.
Danial A. Latifi and M. I. Khowaja, for the appellant.
C. B. Agarwala and Akhtar Husain, for respondent No. 3.
The Judgment of the Court was delivered by Ray, J.
This appeal is by certificate from the judgment dated 15th January, 1965 of the Allahabad High Court.
The appellant son of Sardar Mujibul Rahman Khan a zamindar of a number of villages in the District of Kheri, Uttar Pradesh impeached the orders of the Board of Revenue of Uttar Pradesh dated 30 August, 1960 and 6 September, 1960 whereby the Board 442 issued three directions.
The first was to stop payment of instalment money or the bonds by the treasuries.
The second was to direct the Compensation Officer to hand over bonds of the face value of Rs. 32,000 reported to be remaining with him for liquidation of debts.
The third was an order attaching movable and immovable properties belonging to the appellant and his brother.for liquidation of debts.
The principal question in this appeal is whether the first res pondent, the Board of Revenue Uttar Pradesh had authority to pass, the order impugned in this appeal.
The third respondent Raja Shatranjai the decree holder was a creditor of the appellant 's father Sardar Mujibul Rahman Khan on the basis of a mortgage deed.
Raja Shatranjai obtained a decree on the said mortgage debt for Rs. 1,31,040 1 0 and Rs. 1931 1 0 as costs.
The decree is dated 28 September, 1939.
The decree was passed under the provisions of the Uttar Pradesh Encumbered Estates Act, 1934 (hereinafter referred to as the1934 Act).
The decree was passed on the application of Sardar Mujibul Rahman Khan under section 4 of the 1934 Act for the liquidation of his debts.
The debtor was a zamindar in the District of Lakhimpur Kheri.
The decree was transferred to the Deputy Commissioner of Kheri for liquidation of debts.
Meanwhile the U. P. Zamindari Abolition and Land Reforms.
Act, 1951 (hereinafter referred to as the 1951 Act) came into, force.
The proprietary rights of the intermediaries vested in the State Government and the intermediaries were entitled to receiver compensation in lieu thereof.
The judgment debtor was an intermediary.
Notices were issued to the intermediaries to take delivery of the bonds or receive payment in cash on specified dates.
The appellant on the death of his father became entitled to 2/3rd of the Zamindari property and compensation therefore.
He took delivery of the compensation bonds of the value of Rs. 42,750/from the Compensation Officer, Lakhimpur while bonds of the value of Rs. 21,250 were received by his brother Hikmat Hakim Khan.
The total amount of bonds received by the appellant and his brother aggregated Rs. 64,000.
On 14 April, 1959 the decree holder applied to the Collector, Kheri for an order that the appellant and his brother do return the bonds which they had received from the Compensation Officer failing which their movable and immovable properties to the extent of these bonds be attached for liquidation of their debts.
The Collector on 17 August, 1959 rejected the application.
The decree holder preferred an appeal.
The appeal was dismissed by the Additional Commissioner, Lucknow on.
17 February, 1960.
The decree holder thereupon commenced revision proceedings before 443 the Board of Revenue.
On 30 August, 1960 a member of the Board of Revenue allowed the revision.
On 6 September, 1960 another member of the Board of Revenue concurred in the order.
The Board asked the Collector to take one or other of the three steps, namely, the treasuries to stop payment of money on installment in respect of the compensation bonds or direct the Compensation Officer to hand over bonds of the face value of Rs. 32,000 reported to be remaining with him for the liquidation of the debts or to attach the movable properties of the appellant and his brother for the liquidation of debts.
The appellant thereafter made an application to the High Court under Article 226 of the Constitution for an order quashing the order and directions of the Board of Revenue.
The learned Single Judge quashed the order of the Board of Revenue save and except the direction directing the Compensation Officer to hand over bonds of the face value of Rs. 32,000 reported to be remaining with him for liquidation of debts.
Thereafter the decree holder preferred an appeal.
The Bench of the High Court was divided in their opinion.
The matter was placed before the third learned Single Judge.
The order of the High Court was that direction No. 3 of the Board of Revenue, namely, attachment of movable and immovable properties of the appellant and his brother was quashed.
The High Court upheld the other two orders of the Board of Revenue in regard to stoppage of payment of installment money on the bonds by the treasuries and direction on the Compensation Officer to hand over the bonds of the face value of Rs. 32,000 remaining with him for liquidation of the debts.
Counsel for the appellant contended that the Board of Reve nue did not have any power to issue the directions.
In the present case, the decree was passed under section 14 of the 1934 Act.
Under section 19 of the 1934 Act the Special Judge passing the decree is to send the same to the Collector for execution in accordance with the provisions of Chapter V of the 1934 Act.
The Special Judge under section 19 of the 1934 Act is also to inform the Collector of the nature and extent of the amount of the secured debt which is not legally recoverable otherwise than out of the compensation and rehabilitation grants payable to the Landlord in respect of the mortgaged estate.
The U. P. Zamindari Abolition and Land Reforms Act, 1950 (hereinafter referred to as the 1950 Act) came into force on 26 January, 1951.
a result of the 1950 Act sections 23A and 23B were introduced into the 1934 Act.
Section 23A speaks of compensation and rehabilitation grant to be placed at the disposal of the Collector.
Section 23B 444 speaks of liquidation of secured debts recoverable both from compensation and rehabilitation grant.
The sections are set out hereunder : "23A. Compensation and rehabilitation grant to be placed at the disposal of the Collector : The Collector shall require the Compensation Officer and Rehabilitation Grants Officer as may be necessary to place at his disposal in pursuance of section 70 of the U. P. Zamindari Abolition and Land Reforms Act, 1950, the amount of compensation money and rehabilitation grant payable to the landlord in respect of his proprietary rights in land reported to be liable to attachment or sale under the provisions of sub section (2) of section 19.
23B. Liquidation of secured debt recoverable from compensation and under rehabilitation grant.: (1) Without prejudice to the provisions of Section 8 of the U. P. Zamindar 's Debt Reduction Act, 1952.
the amount or the bonds on account of compensation or rehabilitation grant received by the Collector in pursuance of the requisition under Section 23 A shall be expended or utilised by the Collector in liquidation of the amount of the secured debt which having regard to the provisions of the U. P. Zamindar 's Debt Reduction Act, 1952 was secured on the proprietary rights in land in respect of which such money has been received.
(2) If any balance out of the compensation and rehabilitation grant received by the Collector in pursuance of the requisition under Section 23 A remains in the hands of the Collector after utilising the same in accordance with the provisions of sub section (1), such balance shall be utilised by the Collector in discharging the debts, other than the debts, referred to in the said sub section in order of priority".
Both these sections of the 1934 Act refer to section 70 of the 1950 Act.
Section 70 of the said Act is as follows : "Compensation money to be placed at the disposal of the Court or authority : Where before any Court or authority any suit or proceeding is pending which directly or indirectly affects or is likely to affect the right of any person to receive the whole or part of the compensation determined under Chapter III, the Court or authority may require the Compensation Officer to place at its disposal the amount so payable and thereupon the same shall be disposed of in accordance with the orders of such Court or authority".
445 The Collector, therefore, by reason of the provisions of the 1934 Act and the 1950 Act requires the Compensation Officer and the Rehabilitation Officer to place the amount of compensation at his disposal.
The Collector on receipt of the grant is to expend or utilise the same in liquidation of the amount of the secured debt and if the balance remains it is to be utilised in discharging the debts other than those mentioned in section 23 B (1) of the 1934 Act, in order of priority.
By reason of the provisions contained in section 70 of the 1950 Act and section 23A of the 1934 Act the compensation money is sent for by the Collector for the purpose of liquidation of secured debt on which decree is passed.
The Compensation Officer under rule 77(1) of the Zamindari Abolition and Land Reforms Rules, 1952 could issue notice to the intermediary directing him to take delivery of the bonds.
The issue of a notice would not clothe the intermediary with the right to take away the bonds because under section 18 of the 1934 Act the decree holder becomes entitled to recover the amount of the decree in the manner and to the extent mentioned in the 1934 Act.
The proviso to section 18 of the 1934 Act enacts that the secured debt shall be recoverable from the compensation and rehabilitation grants as though the security had not been extinguished.
The question, in the present case, is whether the appellant could lawfully obtain delivery of the bonds from the Compensation Officer.
Sections 23A and 23B of the 1934 Act require that the amount or the bonds on account of compensation or rehabilitation grant received by the Collector shall be expended or utilised by the Collector in liquidation of the amount of the secured debt.
Under section 23B of the 1934 Act the bonds are received by the Collector in pursuance of the requisition under section 23A of the 1934 Act.
The absence of the service of a requisition cannot confer a right on the judgment debtor to take away the compensation money or bonds.
The principle is actus curia neminem gravabit.[445E F] The decree holder under the provisions of the relevant statutes was entitled to be paid out of the compensation grant monies in satisfaction of the decree.
If the Collector had required the Compensation Officer under section 23A of the 1934 Act to place at his disposal pursuant to section 70 of the 1950 Act the compensation money, the bonds could not have been taken delivery of by the appellant.
The Board of Revenue rightly gave the directions to secure compliance with the provisions of the statute, and performance of statutory duty by the Collector as well as the Compensation Officer.
The appellants were not entitled to, receive the bonds without satisfying the decree.
The appellants were wrong in doing so.
The appellant could not take advantage of his own wrong.
That is why the Board of Revenue correctly, directed the 446 stoppage by the treasuries of payment of instalment money on the bonds.
The other direction by the Board of Revenue requiring the Compensation Officer to hand over the bonds remaining with the Compensation Officer was in aid of valid compliance with sections 23A and 23B of the 1934 Act as well as section 70 of the 1950 Act.
The jurisdiction and authority of the Board of Revenue in the present appeal touched directly on the performance of statutory obligations by statutory authorities.
The compensation bonds are required by the statute to go to the Collector for liquidation of secured debts.
The judgment debtor is not entitled to the compensation bonds without liquidation of the debts in accordance with the provisions of the statute.
The High Court rightly upheld the directions of the Board of Revenue.
The appeal is therefore dismissed.
The parties will pay and bear their own costs in this Court.
G.C. Appeal dismissed.

Output:
There was a decree under the provisions of the U.P. Encumbered Estates Act, 1934 against the appellant 's father on the basis of a mortgage deed.
The decree was transferred to the Deputy Commissioner for liquidation of debts.
Meanwhile the U.P. Zamindari Abolition and Land Reforms Act, 1951 came into force.
Compensation for proprietary rights as an intermediately vested in the State Government became payable to the judgment debtor.
On the death of his father the appellant and his brother became entitled to his property as well as the compensation payable to him.
The appellant and his brother received bonds of the aggregate value of Rs. 64,000.
Bonds of the face value of Rs. 32,000 remained with the compensation officer.
In 1959 the decree holder applied to the Collector for an order that the appellant and his brother do return the bonds which they had received from the compensation officer failing which their properties were to be attached.
The matter went up to the Board of Revenue.
The Board asked the Collector to take one or the other of three steps, namely, (1) to stop payment of instalment money on the bonds by the treasuries or (2) direct the compensation officer to hand over bonds of the face value of Rs. 32,000 remaining with him for the liquidation of the debts or (3) to attach the movable properties of the appellant and his brother for the liquidation of debts ' The appellant thereafter made an application to the High Court under article 226 of the Constitution for an order quashing the order and direction to the Board of Revenue.
The Division Bench, in appeal against the order of the Single Judge, quashed the direction of the Board of Revenue according to which the properties of the appellant and his brother were to be attached.
The High Court upheld the other two orders of the Board of Revenue in regard to stoppage of payment of instalment money on the bonds by the treasuries and direction to the Compensation Officer to hand over the bonds of the face value of Rs. 32,000 remaining with him for liquidation of the debts.
in appeal to this Court the appellant contended that the Board of Revenue did not have power to issue the said directions.
HELD: By reason of the provisions contained in section 70 of the U.P. Zamindari Abolition and Land Reforms Act, 1950 and section 23A of the U.P.
Encumbered Estates Act, 1934 the compensation money is sent for by the Collector for the purpose of liquidation of secured debts on which decree is passed.
The Compensation Officer under r. 77(1) of the Zamindari Abolition and Land Reforms Rules, 1953 could issue notices to the intermediary directing him to take the bonds because under section 18 of the 1934 Act the decree holder becomes entitled to recover the amount of the decree in the manner and to the extent mentioned in 1934 Act.
The proviso 441 to section 18 of the 1934 Act enacts that the secured debt shall be recoverable from the compensation and rehabilitation grant as though the security had not been extinguished.
[445C D] Further, section 23A and section 23B of the 1934 Act require that the amount from the bonds on account of compensation or rehabilitation grant received by Collector shall be expended or utilised by the Collector in liquidation of the amount of the secured debt.
Under section 23B of the 1934 Act the bonds are received byCollector in pursuance of the requisition under section 23A of the 1934 Act.
The absence of the service of a requisition cannot confer a right on thejudgment debtor to take away the compensation money or bonds.
The principle is actus curia neminem gravabit.
[445E F] The decree holder under the provisions of the relevant statutes was entitled to be paid out of the compensation grant monies in satisfaction of the decree.
If the Collector had required the Compensation Officer under section 23A of the 1934 Act to place at his disposal pursuant to section 70 of the 1950 Act the compensation money, the bonds could not have been taken delivery of by the appellant.
The Board of Revenue rightly gave the directions to secure compliance with the provisions of the statute and performance of the statutory duty by the Collector as well as the Cornpenation Officer.
The appellants were not entitled to receive the bonds without satisfying the decree.
That is why the Board of Revenue correctly directed the stoppage by the treasuries of payment of instalment on the bonds.
[445G H] The other direction of the Board of Revenue requiring the Compensation Officer to hand over bonds remaining with the Compensation Officer was in aid of valid compliance with sections 23A and 23B of the 1934 Act as well as section 70 of the 1950 Act.
[446A] The jurisdiction and authority of the Board of Revenue touched directly on the performance of statutory obligations by statutory authorities.
The High Court rightly upheld the directions of the Board of Revenue.
[446B]


Input:
tition (Civil) No. 47 of 1992.
(Under Article 32 of the Constitution of India).
789 P.L Singal and NA.
Siddiqui for the Petitioner.
D.N. Dwivedi, Additional Solicitor General and Mrs. Niranjana Singh for the Respondent.
The Judgment of the Court was delivered by SHARMA CJ.
By the present application under Article 32 of the Constantine of India, the petitioner has challenged the constitutional validity of the Representation of the People (Amendment) Ordinance, 1992 (Ordinance No.1 of 1992) and the Representation of the people (Second Amendment) Ordinance, 1992 (Ordinance No.2 of 1992), on the grounds of violation of Articles 14, 19 and 21.
By the first Ordinance, section 52 of the Representation of the People Act, 1951 (the Act) providing for countermanding elections in certain circumstances has been amended.
By the second Ordinance the period of 20 days in section 30 of the Act has been reduced to 14 days.
Later, when the Parliament met, the amendments were incorporated by an amending Act.
2.The provisions of section 52, as they stood before the amendment, provided for countermanding the election in either of 2 contingencies (i) if a candidate whose nomination was found valid on scrutiny under section 36 or who has not withdrawn his candidature under section 37 died and a report of his death was received before the publication of the fist of contesting candidates under section 38, (ii) if a contesting candidate died and a report of his death was received before the commencement of the poll.
On countermanding the Returning Officer will have to report the fact to the Election Commission; and all proceedings with reference to the election will have to be commenced de novo in all respects as if for a new election.
By the first Ordinance, the area attracting the provisions of countermanding has been narrowed down by confining the provisions only to such cases where a candidate of a retired political party dies.
3.Section 30 deals with appointment of dates for nomination, scrutiny and the holding of poll and in clause (d) it is provided that the date of poll shall not be earlier than the twentieth day after the last date for the withdrawal of candidatures.
With a view to expedite the whole process the words 'twentieth day ' have been substituted by the words "fourteenth day" in the said clause by the impugned Ordinace.
790 4.
Learned counsel for the petitioner has strenuously contended that the distinction made by the impugned amendment between a candidate set up by a recognised political party and any other candidate is artificial inconsistent with the spirit of the election law and discriminatory.
The Constitution does not confer on a candidate set up by a registered political party any special right and treats all candidates similarly.
It does not recognize any categorisation.
It is, therefore, argued that the difference which is being introduced by the impugned amendment is contrary to the scheme of the Constitution and violative of the equality clause in Article 14.
According to the learned counsel this will also infringe the guarantee under Article 19(1)(a) in respect of freedom of speech and expression.
5.Elaborating his argument, the learned counsel contended that the right to choose its representative belongs to the voters of a particular constituency, and this should not be whittled down by amendments which have a tendency to undermine this element.
Lack of wisdom in giving importance to recognized political parties was emphasised by saying that such parties almost always impose their choice of candidates in their own interest and at the cost of the welfare of the constituencies.
By introducing this imbalance in the Act, it is stated, the republican character of the Constitution is jeopardised.
The sum and substance of the argument on behalf of the petitioner is that no distinction can be made between one candidate and another purely depending on recognition as a political party.
6.So far the second Ordinance is concerned, the objection is that the period of 14 days, substituted by the amendment, is too short and the reduction from the period of 20 days is arbitrary and prejudicial to the larger interest for which elections are held.
7.In reply, Mr. Altaf Ahmad, Additional Solicitor General, appearing on behalf of the Union of India has strongly relied upon the statements made in the counter affidavit filed on behalf of the respondent stating that on account of increase in terrorism and physical violence in several parts of the country combined with the phenomenal increase in the number of independent candidates, the danger of disruption of the election process has been fast growing and the problem was, therefore, taken up for serious consideration.
The issue was examined by the Electoral Reforms Committee set up in 1990 under the Chairmanship of the then Minister of law and 791 Justice, late Dinesh Goswami.
After studying the problem deeply and considering various points of view presented in this regard the.
Committee made its recommendation and, accordingly, the impugned amendment was made.
Explaining the urgency of introducing the amendment by an Ordinance (when Parliament was not in session) the counter affidavit states that it had then been decided to hold the General Elections to the House of People from the State of Punjab as also the election to the State Legislature of that State and having regard to the law and order situation prevailing in the State, it was considered essential to curb the danger of disruption of the election process by amending section 52 immediately.
With the same object in view, the period of 20 days mentioned in section 30 was substituted by 14 days.
8.Before proceeding to examine the merits of the argument addressed on behalf of the petitioner it will be useful to note that the right to vote or to stand as a candidate for election is neither a fundamental nor a civil right.
In England also it has never been recognised as a common law right.
In this connection, we may usefully refer to the following observations in,Jyoti Basu & Others vs Debi Ghosal & Others, A.I.R.1982 S.C.983 and 986 which reads as under : "The nature of the right to elect, the right to be elected and the right to dispute an election and the scheme of the constitutional and statutory provisions in relation to these rights have been explained by the Court in N.P. Ponnuswani vs Retuming Officer, Namakkal Constituency, ; : ; and Jagan Nath vs Jaswant Singh, ; We proceed to state what we have gleaned from what has been said, so much as necessary for this case.
A right to elect, fundamental though it is to democracy, is, anomalously enough, neither a fundamental right nor a Common Law Right.
It is pure and simple, a statutory right.
So is the right to be elected.
So is the right to dispute an election.
Outside of statute, there is no right to elect, no right to be elected and no right to dispute an election.
Statutory creations they are, and therefore, subject to statutory limitation.
" 792 The objection raised by the petitioner, therefore, must be examined in this background.
9.The challenge of the petitioner is directed against the differential treatment which the election law in India gives to candidates set up by political parties.
The main thrust of the argument of the learned counsel is that the party system and the recognition of political parties is itself detrimental to the cause of real democracy.
In any event, no additional advantage ought to have been allowed to candidates set up by political parties.
This stand runs counter to the constitutional scheme adopted by the nation.
It has firmly been established that the Cabinet system of Government has been envisaged by our Constitution and that the same is on the British pattern.
(See Shamsher Singh vs State of Punjab; , at 827).
In England where democracy has prevailed for longer than in any other country in recent times, the Cabinet system of Government has been found to be most effective.
In the other democratic countries also the party system has been adopted with success.
It has been realised that for a strong vibrant democratic Government, it is necessary to have a parliamentary majority as well as a parliamentary minority, so that the different points of view on controversial issues are brought out and debated on the floor of the Parliament.
This can be best achieved by the party system, so that the problems of the nation may be discussed, considered and resolved in a constructive spirit.
To abolish or ignore the party system would be to permit a chorus of discordant notes to replace an organised discussion.
In his book "Cabinet Government" (2nd Edition page 16) Sir Ivory Jennings has very rightly said.
"Party warfare is thus essential to the working of the democratic system".
It is, therefore, idle to suggest that for establishing a true democratic society, the party system should be ignored.
Our Constitution has clearly recognized the importance of this system, which was further emphasized by the addition of the 10th Schedule to it.
The Election Symbols (Reservation and Allotment) Order is also a step in that very direction.
There is also no merit whatsoever in the contention that candidates set up by political parties should not receive any special treatment.
The fact that candidates set up by political parties constitute a class separate from the other candidates has been recognized by this Court in numerous cases.
In paragraph 14 of the judgment in the case of Dr. P.N. Thampy Terah vs Union of India [1985] Suppl.
SCC 189, the Constitution 793 Bench observed thus : "It is the political parties which sponsor candidates, that are in a position to incur large election expenses which often run into astronomical figures.
We do not consider that preferring political parties for exclusion from the sweep of monetary limits on election expenses, is so unreasonable or arbitrary as to justify the preference being struck down upon that gournd." In D.M.L. Agarwal vs Rajiv Gandhi, ; a Division Bench of this Court took note of and emphasized the vital role of political parties in a parliamentary form of democracy and anxiety was expressed about the growing number of independent candidates.
For the reasons indicated above, we do not find any substance in the argument of the learned counsel for the petitioner challenging the constitutional validity of the impugned amendment of section 52.
The argument against the reduction of the period of 20 days to 14 days in section 30 is equally without any merit.
The learned counsel could not suggest any good reason for holding that the period of 14 days would be inadequate or inappropriate, especially in the changed circumstances which are prevailing in the country.
Consequently, this writ petition is dismissed with costs assessed at Rs. 2,500 payable to the respondent Union of India.
N.V.K. Petition dismissed.

Output:
The petitioner In his Writ Petition Under Article 32 of the Constitution of India, challenged the constitutional validity of the Representation of the People (Amendment) Ordinance, 1992 (Ordinance No. 1 of 1992), and the Representation of the People (Second Amendment) Ordinance, 1992 (Ordinance No.2 of 1992) on the grounds of violation of Articles 14, 19 and 21 of the Constitution of India.
The provisions of Section 52 of the Representation of the People Act, 1951 as they stood before amendment provided for countermanding the election In either of two contingencies: (1) If a candidate whose nomination was found valid on scrutiny under section 36 or who has not withdrawn his candidature under section 37 died and a report of his death was received before the publication of the list of contesting candidates under section 38, (II) If a contesting candidate died and a report of his death was received before the commencement of the poll.
By Ordinance No. 1 of 1992, the area attracting the provisions of countermanding in section 52 had been narrowed down by confining the provisions only to such cases where a candidate of a recognized political party dies.
787 Section 30 of the Representation of People Act, 1951 dealt with appointment of dates for nomination, scrutiny and the holding of poll, and in clause (d) it was provided that the date of poll shall not be earlier than the twentieth day after the last date for the withdrawal of candidatures.
With a view of expedite the whole process, the words 'twentieth day ' have been substituted by the words 'fourteenth day ' in clause (d) of Section 30 by the Second Ordinary viz. Ordinance No. 2 of 1992.
On behalf of the petitioner it was contended that the distinction made by the impugned amendment between a candidate set up by a recognised political party and any other candidate is artificial, inconsistent with the spirit of the election law and discriminatory, that the Con stitution does not confer on a candidate set up by a registered political party any special right, and treats all candidates similarly, and does not any categorisation, that the difference being introduced by the impugned amendment was contrary to the scheme of the Constitution and violative of the equality clause in Article 14, and that it also infringed the guarantee under Article 19(1) (a).
In respect of the Second Ordinance the objection was that the period of 14 days substituted by the amendment was too short, and the reduction from the period of 20 days was arbitrary and prejudicial to the larger interest for which elections are held.
The Petition was contested on behalf of Union of India by stating that on account of increase in terrorism and physical violence in several parts of the Country combined with the phenomenal increase in the number of independent candidates, the danger of disruption of the election process had been fast growing and the problem was, therefore, taken up, examined and it was considered that the amendments were essential to curb the danger of disruption of the election process.
Dismissing the Writ Petition, this Court, HELD : 1.
The right to vote or to stand as a candidate for election is neither a fundamental right nor a civil right In England also it has never been recognised as a common law right [791D] Jyoti Basu & Ors.
vs Debi Ghosal & Ors, ; and 986, referred to. 2.
The Cabinet system of Government has been envisaged by our 788 Constitution, and the same is on the British pattern.
In England, where democracy has prevailed for longer than in any other country in recent times, the Cabinet system of Government has been found to be most effective.
In other democratic countries also the party system has been adopted with success.
[792C D] Shamser Singh vs State of Punjab, ; at 827, referred to.
3.For a strong vibrant democratic Government, it is necessary to have a parliamentary majority as well as a parliamentary minority, so that the different points of view on controversial issues are brought out and debated on 'he floor of the Parliament.
This can be best achieved by the party system, so that the problems of the nation may be discussed, considered and resolved in a constructive spirit.
To abolish or ignore the party system would be to permit a chorus of discordant notes to replace an organised discussion.
[792E] Sir Ivor Jennings 'Cabinet Government 2nd Edn.
p.16, referred to.
4.Our Constitution has dearly recognised the importance of the party system, which was further emphasized by the addition of the 10th Schedule to it The Election Symbols (Reservation and Allotment) Order is also a step in that very direction.
[792F] 5.That candidates set up by political parties constitute a class separate from other candidates has been recognised in numerous cases by this Court which has also emphasized the vital role of political parties in a parliamentary form of democracy and expressed anxiety about the growing number of independent candidates.
[792H, 793C] Dr. P.N. Thampy Terah vs Union of India ; and D.M.L. Agarwal vs Rajiv Gandhi, ; , referred to.
6.The Representation of the People (Amendment) Ordinance, 1992 and theRepresentation of the People (Second Amendment) Ordinance, 1992 are constitutionally valid.
[789C]


Input:
Appeal No. 27 of 1960 WITH Civil Appeals Nos.
574, 92 411 and 285 of 1960, 351 of 1959 and Petitions Nos. 20 and 106 of 1960.
Appeal by special leave from the judgment and order dated August 6, 1957, of the Patna High Court in M. J. C. No. 57 of 1956.
Lal Narayan Sinha and section P. Varma, for the appellants (in C. A. No. 27 of 1960).
D. Goburdhan, for respondents Nos. 1 to 7.
K. K. Sinha, for the appellant (in C. A. No. 574 of 1960).
D. P. Singh, for the respondent.
D. P. Singh, for the appellants (in C. A. No. 92 of 1960).
D. Goburdhan, for the respondents.
R. C. Prasad, for the appellants (in C. A. No. 411 of 1960).
L. K. Jha, section K. Jha and K. K. Sinha, for the respondents.
section P. Varma, for the appellants (in C. A. No. 285 of 1960).
L. K. Jha, B. K. Garg and section C. Agarwal, for the respondent.
section P. Varma, for the appellant (in C. A. No. 351 of 1959).
R. K. Garg and section C. Agarwala, for the respondents.
Tarkeshwar Dayal, K. K. Sinha and R. C. Prasad, for the petitioners (in Petition No. 20 of 1960).
Lal Narayan Sinha and section P. Varma, for respondent No. 1.
R. K. Garg and section C. Agarwala, for the petitioner (in Petition No. 106 of 1960).
section P. Varma, for respondent No. 1.
384 1961.
April 25.
The judgment of the Court was delivered by DAS GUPTA, J.
The common question which arises for decision in this group of cases is as regards the validity of the Bihar Act No. XVI of 1959 (Bihar Land Reforms Amendment Act, 1959), in so far as it amends with retrospective effect sections 4 and 6 of the Bihar Land Reforms Act, 1950, to be indicated later, and inserts the new sections, section 7B and section 7C in that Act.
It appears that sometime after the Bihar Land Reforms Act became law and action was taken under section 3 thereof by the State Government issuing notifications, declaring that the estates or tenures of proprietors or tenure holders, specified in the noti fications had passed to and become vested in the State, the Revenue authorities started interfering with the rights of those ex proprietors and ex tenureholders to hold Melas on lands of which they were thereafter in occupation as occupancy raiyats under the State and started settling rights to realise tolls from such Melas on behalf of the State Government.
Aggrieved by this action taken by the Revenue authorities on behalf of the State Government applications were made by several of these erstwhile intermediaries now occupancy raiyats to the High Court of Patna for writs restraining the Government and its officers from such interference with their rights.
Five such applications have given rise to the five appeals which are numbered as C. A. No. 351 of 1959, C. A. No. 27 of 1960, C. A. No. 92 of 1960, C. A. No. 285 of 1960 and C. A. No. 411 of 1960.
The High Court held that in view of the provisions of section 6 of the Bihar Land Reforms Act (before its amendment) and the fact that the provisions made in section 4(a) of the Act about the consequences that would ensue on the vesting of an estate or tenure in the State were "subject to" the provisions of section 6, the State had no right to hold Melas on the Bakasht lands of the ex intermediaries now occupancy raiyats.
Accordingly the High Court allowed the applications and issued writs as prayed for.
Against these orders of the High Court the State of Bihar and its officers have preferred the 385 five appeals mentioned above, after obtaining special leave from this Court.
Some time after special leave was obtained by these appellants the Bihar Legislature enacted in 1959, the Bihar Land Reforms Amendment Act, 1959, (Bihar Act XVI of 1959).
This Act amended inter alia section 4, cl.
(b) of the Bihar Land Reforms Act, 1950, by adding the word "Mela" after the words "jalkars, hats, and bazars" and by omitting the words "subject to the subsequent provisions of this Chapter" in cl.
(a) of section 4.
It also amended section 6 of the 1950 Act by substituting for the words "Notwithstanding anything contained in this Act" the words "subject to the provisions of sections 7A and 7B".
Of these section 7B provides that "Where on any land deemed to be settled with the intermediary under the provisions of section 5, section 6 or section 7, a Mela was being held by the intermediary at any time within 3 years of the date of vesting, the right to hold such Mela on such land shall, with effect from such date, vest in the State and notwithstanding anything contained in any law, the State shall have and the intermediary shall not, except with the consent of the State Government have the right to hold such Mela on such land or to do anything which may prejudicially affect such Mela".
Section 7C contains provisions as regards settlement of hats, bazars or melas referred to in section 7A and section 7B and provides inter alia that settlements will be made with the outgoing intermediary or his heir after application is received from him and if there are several of them who apply for settlement, with the most suitable of them.
The Amending Act made the amendments mentioned above, except the insertion of a. 7C, retrospective, with effect from the date of enactment of the parent Act.
The Amending Act had already been passed, when several other applications under article 226 of the Constitution for similar relief against the interference by the Government with the intermediaries ' right to hold Melas came up for consideration before the High Court.
The High Court rejected these applicants ' attack against the validity of the Amending Act and held that in view of the provisions 386 now made the applicants were not entitled to any relief.
Civil Appeal No. 574 of 1960 has been preferred by one of such applicants on a certificate granted by the High Court.
The two applications under article 32 of the Constitution were filed in this Court for writs of mandamus against the State of Bihar and its officers restraining them from interfering with the applicant 's right to hold melas on their lands.
Both of these were filed after the Bihar Land Reforms Amendment Act, 1959, had become law.
It is obvious that if the Amending Act is valid legislation, in so far as it amends with retrospective effect section 4 and section 6 of the 1950 Act as mentioned above and inserts section 7B, the ex intermediaries have not and the State has the right to hold melas on the Bakasht lands.
The main question therefore is whether this is a valid legislation.
To answer this question we have to examine in the first place whether the Bihar Legislature which enacted the Amending Act had on that date the legislative competence under article 246 of the Constitution to do so; and secondly, whether the law was void because of the provisions of article 13 of the Constitution.
The Amending legislation was clearly within Item 42 of the Concurrent List, being a law as regards acquisition of property.
Mr. Tarkeshwar Dayal, who appeared on behalf of one of the ex intermediaries submitted that this was really not a matter of land reform; the purpose of the Amending legislation being only to augment the revenue of the State.
It is true that the law by taking the right to hold melas from certain persons and giving it to the State is likely to augment the revenues of the State.
It may well be that this object of augmenting the revenues was one of the main purposes behind the Amending legislation.
That however is no reason to think that this legislation is not also concerned with land reform.
It is however unnecessary for us to consider this question further, for whether it is a law as regards land reform or not, it is clearly and entirely as regards acquisition of property.
The question of the legislature having attempted legislation not within 387, its competence by putting it into the guise of legislation within its competence does not even arise.
The conclusion that necessarily follows is that the amending legislation was within the legislative competence of the Bihar Legislature under article 246 of the Constitution.
This brings us to the main question in controversy, viz., whether the amending legislation is void on the ground that it violates articles 31, 19 and 14 of the Constitution.
A complete answer to this question is furnished in favour of the State if this is a law within the saving provisions of article 31A. article 31A was enacted in the Constitution by the Constitution (First Amendment Act) with retrospective effect from the commencement of the Constitution.
It was further amended by the Constitution (Fourth Amendment) Act, also with retrospective effect from the date of the commencement of the Constitution.
This Article provides inter alia, that notwithstanding anything contained in article 13, no law providing for the acquisition by the State of any estate or of any rights therein. . . shall be deemed to be void on the ground that it is inconsistent with or takes away or abridges any of the rights conferred by articles 19, 31 and 14 of the Constitution.
Is the amending legislation a law "providing for the acquisition by the State of any estate or of any rights therein?" Two arguments have been advanced on behalf of the ex intermediaries to convince us that it is not such a law.
The first argument is that what the amending legislation provides for is not "acquisition" at all within the meaning of article 31A as it is not "acquisition" for a public purpose.
It has been urged that the purpose is a mere augmentation of revenue.
It does not appear to us that when the right of holding the Mela is taken over by the State the only purpose is the augmentation of revenue.
There is scope for thinking that the legislature believed that melas would be better run and be more in the interests of the general public when run by the State than when they are left without control in the hands of private individuals with whom the profit motive is 388 likely to be the sole guiding principle.
It is unnecessary however to answer this question for, in our opinion, a law, may be a law providing for "acquisition" even though the purpose behind the acquisition is not a public purpose.
It is important to notice that the Constitution (Fourth Amendment) Act made important alterations in article 31 also.
One of the amendments of article 31 was that clause 2 now provides that no property shall be compulsorily acquired, (1) save for a public purpose and (2) save by authority of a law which contains provisions for compensation for the property acquired and either fixes the amount of compensation or specifies the principles on which and the manner in which the compensation is to be determined and given.
Then, article 31 A provides inter alia that a law providing for "acquisition" will not be void on the ground that it is inconsistent with or takes away or abridges a right conferred by article 31.
Reading the two articles together as they stand after the fourth amendment of the Constitution it becomes obvious that when article 31A speaks of a law of "acquisition" it contemplates a law which may be for acquisition, though not for a public purpose and lays down that even though this will be in violation of the fundamental right guaranteed by the first part of article 31(2) the law will not be void because of such violation.
The question whether the validity of a law for compulsory acquisition of property by the State can be challenged on the ground that the "acquisition" is not for a public purpose bad to be considered by this Court even before the amendment of article 31(2) as mentioned above in The State of Bihar vs Sir Kameshwar Singh (1).
article 31(2) as it then stood did not in so many words provide that no acquisition can be made save for a public purpose; but it was argued on behalf of the State that such a provision was implicit in the words of article 31(2).
This argument was rejected by Mahajan and Chandrasekhara Aiyar, JJ., but it was accepted by Patanjali Sastri, C. J., and Das, J., both of whom held that the requirement of public (1) 389 purpose being a condition for compulsory acquisition laid down by article 31(2) the law was saved in spite of the violation of such condition by article 31(4) and also article 31A. Mukherjea, J., also said that the requirement of public purpose was a condition implied in the provisions of article 31(2).
His Lordship then added: "For my part, I would be prepared to assume that cl.
(4) of article 31 relates to everything that is provided for in clause (2) either in express terms or impliedly and consequently the question of the existence of a public purpose does not come within the purview of an inquiry in the present case.
" It was in this state of judicial opinion that article 31(2) was amended by the Constitution (Fourth Amendment) Act as mentioned above and the requirement of public purpose was expressly made a condition for compulsory acquisition by the State.
The basis for the argument that the question whether there was a public purpose or not is open to judicial review in spite of article 31A has therefore disappeared.
It is worth noticing in this connection that in Sir Kameshwar Singh 's case(1) the argument that quite apart from anything in article 31(2) as it then stood no law of acquisition could be made except for a public purpose was sought to be reinforced by the words in Item 36 of the State List and Item 42 of the Concurrent List.
These items read as follows: "36.
Acquisition or requisitioning of property, except for the purposes of the Union, subject to the provisions of entry 42 of List Ill." "42.
Principles on which compensation for property acquired or requisitioned for the purposes of the Union or of a State or for any other public purpose is to be determined, and the form and the manner in which such compensation is to be given.
" The argument on the basis of these entries was that the State legislatures had no power to make a, law for acquisition of property without fulfilling ' the condition of public purpose.
The Constitution (.Seventh Amendment) Act which came into force on the 1st (1) 50 390 day of November, 1956, deleted Entry 36 of the State List and substituted for the former phraseology of Item 42 of the Concurrent List the words "acquisition and requisition of property".
It is quite clear that after its amendment the legislative list permits the State legislature to enact a law of acquisition even without a public purpose; and that the only obstacle to such a law being enacted without a public purpose is the provisions of article 31(2).
That obstacle also disappears if the law in question is one within article 31 A.
It was next contended that the acquisition of the right to hold the Mela, for which the amending Act provides is not acquisition, in any case, of "rights" "in any estate" within the meaning of article 31A as defined in cl.
2(b) of the same Article.
It was argued that this definition includes only rights of persons who are intermediaries and unless the raiyat whose rights are being acquired is an intermediary, that is, a person between the State and the tiller of the soil, his rights are not rights within the definition of "rights in relation to an estate"; and consequently, a law providing for acquisition of the rights of such a raiyat is not a law within the saving provisions of article 31A.
It is pointed out that on the date the Amending Act was passed the ex intermediaries had ceased to exist as intermediaries and had become occupancy raiyats under section 6 of the parent Act.
What were being acquired therefore, it is argued, were not rights of intermediaries but rights of raiyats who had ceased to be intermediaries.
It has to be noticed that the impugned provisions amending section 4 and section 6 and section 7(b) have been given retrospective effect so that the parent Act of 1950 has to be read as containing on the very date of its enactment provisions in these sections not as originally enacted but as they stood after the amendment of 1959.
In deciding whether rights of raiyats were being acquired or not we have to forget what happened in consequence of the unmended section 6.
Projecting ourselves to the date September 25, 1950, when the President 's assent to the Bihar Land Reforms Act, 1950, was published in the 391 Gazette and reading the Act as containing section 4 and section 6 as amended and also section 7(b) it cannot but be held that what were being acquired by means of these provisions of the amending legislation giving retrospective effect were certain rights of the intermediaries.
These intermediaries had not on September 25, 1950, ceased to be intermediaries and the fact that under the unmended provisions of section 6 they later on became occupancy raiyats should not be allowed to confuse the fact that the acquisition of certain properties by the amending legislation being itself with effect from September 25, 1950, what was being provided for was acquisition of intermediaries ' rights.
Even if it be assumed that what the amending legislation provided for was the acquisition of raiyats ' rights, there is no justification for holding that these rights were not "rights in any estate" within the definition of el. 2 of article 31A. Clause 2(b) is in these words: "the expression 'rights ' in relation to an estate, shall include any rights vesting in a proprietor, sub proprietor, under proprietor, tenure holder, ralyat, under raiyat or other intermediary and any rights or privileges in respect of land revenue.
" The contention on behalf of the ex intermediaries is that the rights of raiyats who are not intermediaries, in the sense of being middlemen between the State and the tiller of the soil, are not within this definition.
This contention does not however stand a moment 's scrutiny, for the simple reason, that it is well known that ordinarily at least, a raiyat or an under raiyat is not a person, who can be called an intermediary.
It is reasonable to think that the word "raiyat"was used in its ordinary well accepted sense, of the person "who holds the land under the proprietor or a tenure holder "for the purpose of cultivation" and the word "under raiyat" used in the equally well accepted and ordinary sense of "a person who holds land under a raiyat for the purpose of cultivation.
" It is necessary to remember in this 392 connection that article 31A as first enacted by the Con stitution (First Amendment) Act did not contain these words "raivat, under raiyat"; and that after the First Amendment the definition ran thus: "the expression rights ', in relation to an estate shall include any rights vesting in a proprietor, sub proprietor, under proprietor,, tenure holder or other intermediary and any rights or privileges in respect of land revenue.
" It was the Fourth Amendment which in the year 1956 inserted the words "raiyat, under raiyat "immediately after the words "tenure holder".
At that time laws bad already been passed in most of the States for the acquisition of the rights of intermediaries in the estates; rights of raiyats or under raiyats who might answer the description "intermediary" were also within the definition because of the use of the word "or other intermediary".
The only reason for specifically including the rights of "raiyats" and "under raiyats" in the definition could therefore be to extend the protection of article 31A to laws providing for acquisition by the State Governments of rights of these "raiyats" or "under raiyats".
In the circumstances and in the particular setting in which the words "raiyat" or "under raiyat" were introduced into the definition, it must be held that the words "or other intermediary" occurring at the end, do not qualify or colour the meaning to be attached to the tenures newly added.
Another contention raised in support of the argument that the impugned law is not for acquisition of a right in an estate is that the right to hold a Mela is not a right in the lands at all.
This contention is wholly unsound.
Holding a hat, or bazar or mela is only a mode of user by the owner of his land.
Just as he can enjoy the land belonging to him in other ways, he can use it for the purpose of having a concourse of people buyers and sellers and others for a hat, or bazar or mela subject, as in the case of other user to the requirement that no nuisance is created and the legal right of others are not infringed.
Consequently, the right to hold a Mela has always been 393 considered in this country to be an interest in land, an interest which the owner of the land can transfer to another along with the land or without the land.
There can be no doubt therefore that the right of the proprietor of an estate to hold a Mela on his own land is a right in the "estate, being appurtenant to his ownership of the land; so also the right of a tenureholder, who it has to be remembered is the owner of the land subject only to the payment of rent to the proprietor, to hold a mela on land forming part of the tenure.
It is true that a licence to hold a Mela on another 's land in which no interest is transferred is not an interest in land; but there is no question here of the acquisition of any licence to hold a Mela at another person 's land.
The argument that the impugned law was not a law for acquisition of a right in the "estate" because the right to hold a mela was not a right in the land must therefore be rejected.
Lastly, it was contended that long before the date of the amending Act the "estates" had ceased to exist as a consequence of the notifications issued under section 3 of the Parent Act and consequently whatever was being acquired in 1959 could not be a right in an "estate".
Here also we have to take note of the fact that the impugned provisions of the Amending Act were made retrospective with effect from the date of the original enactment so that we have to project ourselves to September 25, 1950, the date of the original enactment, and consider whether on that date the law provided for acquisition of a right in an "estate".
Undoubtedly the "estates" did exist on that date and so the acquisition retrospectively provided for from that date was acquisition of a right in an estate.
Even if we ignore the fact that the impugned provisions of the Amending Act were given retrospective effect there is no warrant for saying that what was being acquired was not a right in an "estate".
"Estate" was defined in the Bihar Tenancy Act to mean "any land included under one entry in any of the general registers of revenue paying lands and revenue free lands, prepared and maintained under the law for the time being in force by the Collector of 394 a District".
It is not disputed before us that in spite of the fact that in consequence of notifications under section 3 of the Act the "estates" had become vested in the State, these registers continued to be maintained at least up to the date of the Amending Act and even later.
The position therefore is that the "estates" have become vested in the State but have still not ceased to be "estates".
We have therefore come to the conclusion that the impugned provisions of the Amending Act is a law providing for the acquisition by the State of rights in an "estate" ".
within the meaning of article 31A of the Constitution and consequently even if we assume that they are inconsistent with or take away or abridge any of the rights conferred by articles 14, 19 and 31 they are not void on that ground.
The conclusion cannot therefore be escaped that the ex intermediaries have not and the State has the right to hold melas on the Bakasht lands of which they have be.
come occupancy raiyats under the provisions of section 6.
We therefore allow the appeals by the State and set aside the order of the High Court for the issue of writs and order that the applications under article 226 made before the High Court be dismissed.
We also dismiss the two petitions under article 32 of the Constitution filed in this Court, and also Civil Appeal No. 574 of 1960.
In the circumstances of the case, we make no order as to costs.
Appeals by the State allowed.
C. A. No. 574 of 1960 and Petitions under article 32 dismissed.

Output:
After the estates and tenures of proprietors or tenure holders had passed to and became vested in the State by virtue of the Bihar Land Reforms Act, 1950, the Revenue Authorities interfered with the rights of those ex proprietors and ex tenureholders to hold Melas on lands which were occupied by them thereafter as occupancy raiyats and collected tolls from such Melas on behalf of the Government whereupon those intermediaries made applications to the High Court for writs restraining the Government from such interference which were allowed by the High Court.
During the pendency in this Court of these appeals preferred by the Officers of the State of Bihar against the order of the High Court the Bihar Land Reforms Amendment Act, 1959, was passed amending the Bihar Land Reforms Act of 1950 with retrospective effect by which the word Mela was added after the words jalkars, hats and bazars in section 4, cl.
(b) of the amended Act.
Further amendments provided inter alia that the State Government and not the intermediaries except with the consent of the State Government shall have the right to hold such Melas.
The main question arising for decision in these appeals and certain other applications made to this Court under article 32 of the Constitution of India was whether the amending legislation violated articles 14, 19 and 31 of the Constitution.
Held, that the Bihar Land Reforms Amendment Act, 1959, is a law providing for the acquisition by the State of rights in an "estate" within the meaning of article 31A of the Constitution and even if it is assumed that it abridges the rights conferred by articles 14, 19 and 31 of the Constitution its provisions are not void on that ground.
The amending legislation was within the legislative com petence of the Legislature under article 246 of the Constitution and after its amendment the legislative list permitted the State 383 Legislature to enact a law of acquisition even without a public purpose.
The State of Bihar vs Sir Kameshwar Singh, [1952] S.C.R. 889, considered.


Input:
Civil Appeal No. 2526 of 1972.
Appeal from the Judgment and Order dated the 13th January, 1972 of the Calcutta High Court in Matter No. 326 of 1967.
G. C. Sharma and section P. Nayar, for the Appellant.
D. Pal, B. Sen, (Mrs.) Leila Seth, P. K. Pal, section R. Agarwala and Parveen Kumar for the Respondent.
The Judgment of the Court was delivered by KHANNA, J.
This appeal on certificate is against the Full Bench judgment of the Calcutta High Court whereby on petition under article 226 of the Constitution of India filed by the respondent that court by majority quashed notice under section 148 of the Income tax Act, 1961 (hereinafter referred to as the Act) issued by appeallant No. 2 (Income tax Officer E Ward, Hundi Circle, Calcutta) (hereinafter referred to 958 as the appellant) for the purpose of reopening assessment of the income of the respondent for the assessment year 1958 59.
The respondent was assessed for the assessment year 1958 59 under section 23(3) of the Indian Income tax Act, 1922 on June 14, 1960.
His total income was assessed to be Rs. 37,872.
While making the assessment the Income tax Officer allowed deduction of a sum of Rs. 15,991 by way of expenses claimed by the respondent.
The expenses included Rs. 10,494/4 As/3 Pies by way of interest.
According to the respondent, he produced through his authorised representative all books of accounts, bank statements and other necessary documents in connection with the return.
On March 14, 1967 the respondent received notice dated March 8, 1967 issued by the appellant under section 148 of the Act stating that the appellant had reason to believe that the respondent 's income which was chargeable to tax for the assessment year 1958 59 had escaped assessment within the meaning of section 147 of the Act and that the notice was being issued after obtaining the necessary satisfaction of the Commissioner of Income tax.
The respondent was called upon to submit within 30 days from the date of the service of the notice a return in the prescribed form of his income for the assessment year 1958 59.
On May 2, 1967 the respondent through his lawyer stated that there was no material on which the appellant had reason to believe that the respondent 's income had escaped assessment and, therefore, the condition precedent for the assumption of jurisdiction by the appellant had not been satisfied.
The appellant was said to have no competence or jurisdiction to re open the assessment under section 147 of the Act on a mere change of opinion.
The appellant was also called upon to furnish all the materials on which he had reason to believe that income had escaped assessment.
As, according to the respondent, there was no satisfactory response from the appellant, he filed petition under article 226 of the Constitution for quashing the impugned notice.
It was denied in the affidavit on behalf of the appellant that all materials relevant and necessary for the assessment of the respondent 's income for the assessment year 1958 59 had been produced before the Income tax Officer at the time of the original assessment.
It was further stated: "Subsequent to the assessment for the assessment year 1958 59, it was discovered, inter alia, that some of the loans shown to have been taken and interests alleged to have been paid thereon by the petitioner during the relevant assessment year were not genuine.
The Income tax Officer had reason to believe and bona fide believed that the said alleged loans and the interest alleged to have been paid thereon are not genuine.
If necessary, I crave leave to produce before the hon 'ble Judge hearing the application, the relevant records on the basis of which the said Income tax Officer had reason to believe that the income of the petitioner escaped assessment as aforesaid at the hearing of the application.
" During the pendency of the proceedings the High Court directed that a copy of the report made by the appellant to the Commissioner of 959 Income tax for obtaining latter 's sanction under section 147 be produced.
The report was accordingly produced, and the same reads as under: "There are hundi loan credits in the name of Narayan singh Nandalal, D. K. Naraindas, Bhagwandas Srichand, etc., who are known name lenders, and also hundi loan credit in the name, Mohansingh Kanayalal, who has since confessed he was doing only name lending.
In the original assessment these credits were not investigated in detail.
As the information regarding the bogus nature of these credits is since known, action under section 147 (a) is called for to reopen the assessment and assess these credits as the undisclosed income of the assessee.
The assessee is still claiming that the credits are genuine in the assessment proceedings for 1962 63.
Commissioner 's sanction is solicited to reopen the assessment for 1958 59, under section 147(a).
" All the three Judges who constituted the Full Bench found that the assessee was not being charged with omission to disclose all facts: he was charged for having made an untrue disclosure because the assessee had stated that he had received certain sums of money from certain persons as loans when, in fact, he had not received any sum at all from these persons.
It was also stated by the assessee at the time of the original assessment that he had paid interest to certain persons when, in fact, he had not, if the information received later was true.
The duty of the assessee, it was held, was not only to make a full disclosure of all material facts, his duty was also to make a true disclosure of facts and not to mislead the assessing officer by disclosing certain things which did not represent facts.
The High Court accordingly held that once an assessee infringes this rule, any subsequent discovery of fact by the assessing officer which would raise a resonable belief in his mind that the assessee had not made a true and correct disclosure of the facts and had thereby been responsible for escapement of his income from assessment would attract section 147 of the Act.
Two of the learned Judges, A. K. Mukherjea and section K. Mukherjea JJ., however, took the view that the conditions precedent for the exercise of jurisdiction by the Income tax Officer under section 147 of the Income tax Act were not fulfilled in the case as the report submitted by the Income tax Officer to the Commissioner for sanction under section 147(a) was defective.
The defects in the report, in the opinion of the High Court, were the same as had been pointed out by this Court in the case of Chhugamal Rajpal vs section P. Chaliha.(1) The Commissioner, while according permission for taking action under section 147, it was observed, acted mechanically because the Commissioner had not expressly stated that he was satisfied that this was a fit case for the issue of notice under section 148.
As against the majority, Sabyasachi Mukherji J. held that notice under section 148 of the Act was valid and did not suffer from any infirmity.
It was 960 also observed that the Commissioner of Income tax had not acted improperly in giving sanction.
In the result, by majority the High Court quashed the notice issued by the appellant to the respondent.
In appeal before us Mr. Sharma on behalf of the appellants has assailed the judgment of the majority of the learned Judges in so far as they have held that the report submitted by the Income tax Officer to the Commissioner of Income tax for sanction was defective.
As against that, Dr. Pal on behalf of the assessee respondent has canvassed for the correctness of the view taken by the majority regarding the defective nature of the report.
Dr. Pal has in his own turn assailed the finding of all the three learned Judges of the High Court in so far as they have held that the assessee was being charged with omission to disclose true facts.
Contention has also been advanced by Dr. Pal that the material on the basis of which the Income tax Officer initiated these proceedings for reopening the assessment did not have a rational connection with the formation of the belief that the assessee had not made a true disclosure of the facts at the time of the original assessment.
Before dealing with the points of controversy, it would be useful to reproduce the relevant provisions of the Act.
Sections 147 and 148 which deal with income escaping assessment and issue of notice where income has escaped assessment read as under: "147.
Income escaping assessment.
If (a) the Income tax Officer has reason to believe that, by reason of the omission or failure on the part of an assessee to make a return under section 139 for any assessment year to the Income tax Officer or to disclose fully and truly all material facts necessary for his assessment for that year, income chargeable to tax has escaped assessment for that year, or (b) notwithstanding that there has been no omission or failure as mentioned in clause (a) on the part of the assessee, the Income tax officer has in consequence of information in his possession reason to believe that income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of section 148 to 153, assess or ressess such income or recompute the loss or the depreciation allowance, as the case may be, for the assessment year concerned (hereinafter in sections 148 to 153 referred to as the relevant assessment year).
Explanation 1.
For the purposes of this section, the following shall also be deemed to be cases where income chargeable to tax has escaped assessment, namely: (a) where income chargeable to tax has been under assessed; or 961 (b) where such income has been assessed at too low a rate; or (c) where such income has been made the subject of excessive relief under this Act or under the Indian Income tax Act, 1922 (XI of 1922); or (d) where excessive loss or depreciation allowance has been computed.
Explanation 2.
Production before the Income tax Officer of account books or other evidence from which material evidence could with due diligence have been discovered by the Income tax Officer will not necessarily amount to disclosure within the meaning of this section.
Issue of notice where income has escaped assessment. (1) Before making the assessment, reassessment or recomputation under section 147, the Income tax Officer shall serve on the assessee a notice containing all or any of the requirements which may be included in a notice under sub section (2) of section 139; and the provisions of this Act shall, so far as may be, apply accordingly as if the notice were a notice issued under that sub section.
(2) The Income tax Officer shall, before issuing any notice under this section, record his reason for doing so.
" Sub section (1) of section 149 prescribes the time limit for notice and reads as under: "(1) No notice under section 148 shall be issued" (a) in cases falling under clause (a) of section 147 (i) for the relevant assessment year, if eight years have elapsed from the end of that year, unless the case falls under sub clause (ii); (ii) for the relevant assessment year, where eight years, but not more than sixteen years, have elapsed from the end of that year, unless the income chargeable to tax which has escaped assessment amounts to or is likely to amount to rupees fifty thousand or more for that year; (b) in cases falling under clause (b) of section 147, at any time after the expiry of four years from the end of the relevant assessment year.
" Section 151 pertains to the sanction for issue of notice and reads as under: "151.
Sanction for issue of notice. (1) No notice shall be issued under section 148 after the expiry of eight years from the end of the relevant assessment year, unless the Board is satisfied on the reasons recorded by the Income tax Officer that it is a fit case for the issue of such notice.
962 (2) No notice shall be issued under section 148 after the expiry of four years from the end of the relevant assessment year, unless the Commissioner is satisfied on the reasons recorded by the Income tax Officer that it is a fit case for the issue of such notice.
" The provisions of sections 147 to 153 of the Act correspond to those of section 34 of the Indian Income tax Act, 1922.
There have been some points of departure from the old law, but it is not necessary for the purpose of the present case to refer to them.
It would appear from the perusal of the provisions reproduced above that two conditions have to be satisfied before an Income tax Officer acquires jurisdiction to issue notice under section 148 in respect of an assessment beyond the period of four years but within a period of eight years from the end of the relevant year, viz., (1) the Income tax Officer must have reason to believe that income chargeable to tax has escaped assessment, and (2) he must have reason to believe that such income has escaped assessment by reason of the omission or failure on the part of the assessee (a) to make a return under section 139 for the assessment year to the Income tax Officer, or (b) to disclose fully and truly material facts necessary for his assessment for that year.
Both these conditions must co exist in order to confer jurisdiction on the Income tax Officer.
It is also imperative for the Income tax Officer to record his reasons before initiating proceedings as required by section 148(2).
Another requirement is that before notice is issued after the expiry of four years from the end of the relevant assessment years, the Commissioner should be satisfied on the reasons recorded by the Income tax Officer that it is a fit case for the issue of such notice.
We may add that the duty which is cast upon the assessee is to make a true and full disclosure of the primary facts at the time of the original assessment.
Production before the Income tax Officer of the account books or other evidence from which material evidence could with due diligence have been discovered by the Income tax Officer will not necessarily amount to disclosure contemplated by law.
The duty of the assessee in any case does not extend beyond making a true and full disclosure of primary facts.
Once he has done that his duty ends.
It is for the Income tax Officer to draw the correct inference from the primary facts.
It is no responsibility of the assessee to advise the Income tax Officer with regard to the inference which he should draw from the primary facts.
If an Income tax Officer draws an inference which appears subsequently to be erroneous, mere change of opinion with regard to that inference would not justify initiation of action for reopening assessment.
The grounds or reasons which lead to the formation of the belief contemplated by section 147(a) of the Act must have a material bearing on the question of escapement of income of the assessee from assessment because of his failure or omission to disclose fully and truly all material facts.
Once there exist reasonable grounds for the Income tax Officer to form the above belief, that would be sufficient to clothe him with jurisdiction to issue notice.
Whether the grounds are adequate or not is not a matter for the court to investigate.
The 963 sufficiency of grounds which induce the Income tax Officer to act is, therefore, not a justiciable issue.
It is, of course, open to the assessee to contend that the Income tax Officer did not hold the belief that there had been such non disclosure.
The existence of the belief can be challenged by the assessee but not the sufficiency of reasons for the belief.
The expression "reason to believe" does not mean a purely subjective satisfaction on the part of the Income tax Officer.
The reason must be held in good faith.
It cannot be merely a pretence.
It is open to the court to examine whether the reasons for the formation of the belief have a rational connection with or a relevant bearing on the formation of the belief and are not extraneous or irrelevant for the purpose of the section.
To this limited extent, the action of the Income tax Officer in starting proceedings in respect of income escaping assessment is open to challenge in a court of law [see observations of this Court in the cases of Calcutta Discount Co. Ltd. vs Income tax Officer and section Narayanappa & Ors.
vs Commissioner of Income tax while dealing with corresponding provisions of the Indian Income tax Act, 1922].
Keeping the above principles in view, we may now turn our attention to the facts of the present case.
Two grounds were mentioned in the report made by the Income tax Officer for reopening the assessment of the assessee respondent with a view to show that his income had been under assessed because of his failure to disclose fully and truly material facts necessary for the assessment.
One was that Mohansingh Kanayalal, who was shown to be one of the creditors of the assessee, had since confessed that he was doing only name lending.
The other ground was that Narayansingh Nandalal, D. K. Naraindas, Bhagwandas Srichand, etc., whose names too were mentioned in the list of the creditors of the assessee, were known name lenders.
So far as the second ground is concerned, neither the majority of the Judges of the High Court nor the learned Judge who was in the minority relied upon that ground.
Regarding that ground, the learned Judge who was in the minority observed that no basis had been indicated as to how it became known that those creditors were known namelenders and when it was known.
The majority while not relying upon that ground placed reliance upon the case of Chhugamal Rajpal (supra).
In that case the Income tax Officer while submitting a report to the Commissioner of Income tax for obtaining his sanction with a view to issue notice under section 148 of the Act stated: "During the year the assessee has shown to have taken loans from various parties of Calcutta.
From D.I. 's Inv.
No. A/P/Misc.
(5) D.I./63 64/5623 dated August 13, 1965, forwarded to this office under C.I.T., Bihar and Orissa, Patna 's letter No. Inv.
(Inv.) 15/65 66/1953 2017 dated Patna September 24, 1965 it appears that these persons are name lenders and the transactions are bogus.
Hence, proper investigation regarding these loans is necessary.
The names of some of the persons from whom money is alleged to have been taken on loan on hundis are: 1.
Seth Bhagwan Singh Sricharan 964 2.
Lakha Singh Lal Singh 3.
Radhakissen Shyam Sunder The amount of escapement involved amounts to Rs. 1,00,000.
" In dealing with that report this Court observed: "From the report submitted by the Income tax Officer to the Commissioner, it is clear that he could not have had reasons to believe that by reason of the assessee 's omission to disclose fully and truly all material facts necessary for his assessment for the accounting year in question, income chargeable to tax has escaped assessment for that year, nor could it be said that he, as a consequence of information in his possession, had reasons to believe that the income chargeable to tax has escaped assessment for that year.
We are not satisfied that the Income tax Officer had any material before him which could satisfy the requirements of either clause (a) or clause (b) of section 147.
Therefore he could not have issued a notice under section 148".
Reference to the names of Narayansingh Nandalal, D. K. Naraindas, Bhagwandas Srichand, etc., in the report of the Income tax Officer to the Commissioner of Income tax in the instant case does not stand on a better footing than the reference to the three names in the report made by the Income tax Officer in the case of Chuugamal Rajpal.
We would, therefore, hold that the second ground mentioned by the Income tax Officer, i.e., reference to the names of Narayansingh Nandalal, D. K. Naraindas, Bhagwandas Srichand, etc., could not have led to the formation of the belief that the income of the respondent assessee chargeable to tax had escaped assessment for that year because of the failure or omission of the assessee to disclose fully and truly all material facts.
All the three learned Judges of the High Court, in our opinion, were justified in excluding the second ground from consideration.
We may now deal with the first ground mentioned in the report of the Income tax Officer to the Commissioner of Income tax.
This ground relates to Mohansingh Kanayalal, against whose name there was an entry about the payment of Rs. 74 Annas 3 as interest in the books of the assessee, having made a confession that he was doing only name lending.
There is nothing to show that the above confession related to a loan to the assessee and not to someone else, much less to the loan of Rs. 2,500 which was shown to have been advanced by that person to the assessee respondent.
There is also no indication as to when that confession was made and whether it relates to the period from April 1, 1957 to March 31, 1958 which is the subject matter of the assessment sought to be reopened.
The report was made on February 13, 1967.
In the absence of the date of the alleged confession, it would not be unreasonable to assume that the confession was made a few weeks or months before the report.
To infer from that confession that it relates to the period from April 1, 1957 to March 965 31, 1958 and that it pertains to the loan shown to have been advanced to the assessee, in our opinion, would be rather far fetched.
As stated earlier, the reasons for the formation of the belief must have a rational connection with or relevant bearing on the formation of the belief.
Rational connection postulates that there must be a direct nexus or live link between the material coming to the notice of the Income tax Officer and the formation of his belief that there has been escapement of the income of the assessee from assessment in the particular year because of his failure to disclose fully and truly all material facts.
It is no doubt true that the court cannot go into the sufficiency or adequacy of the material and substitute its own opinion for that of the Income tax Officer on the point as to whether action should be initiated for reopening assessment.
At the same time we have to bear in mind that it is not any and every material, howsoever vague and indefinite or distant, remote and far fetched, which would warrant the formation of the belief relating to escapement of the income of the assessee from assessment.
The fact that the words "definite information" which were there in section 34 of the Act of 1922 at one time before its amendment in 1948 are not there in section 147 of the Act of 1961 would not lead to the conclusion that action cannot be taken for reopening assessment even if the information is wholly vague, indefinite, far fetched and remote.
The reason for the formation of the belief must be held in good faith and should not be a mere pretence.
The powers of the Income tax Officer to reopen assessment though wide are not plenary.
The words of the statute are "reason to believe" and not "reason to suspect".
The reopening of the assessment after the lapse of many years is a serious matter.
The Act, no doubt, contemplates the reopening of the assessment if grounds exist for believing that income of the assessee has escaped assessment.
The underlying reason for that is that instances of concealed income or other income escaping assessment in a large number of cases come to the notice of the income tax authorities after the assessment has been completed.
The provisions of the Act in this respect depart from the normal rule that there should be, subject to right of appeal and revision, finality about orders made in judicial and quasi judicial proceedings.
It is, therefore, essential that before such action is taken the requirements of the law should be satisfied.
The live link or close nexus which should be there between the material before the Income tax Officer in the present case and the belief which he was to form regarding the escapement of the income of the assessee from assessment because of the latter 's failure or omission to disclose fully and truly all material facts was missing in the case.
In any event, the link was too tenuous to provide a legally sound basis for reopening the assessment.
The majority of the learned Judges in the High Court, in our opinion, were not in error in holding that the said material could not have led to the formation of the belief that the income of the assessee respondent had escaped assessment because of his failure or omission to disclose fully and truly all material facts.
We would, therefore, uphold the view of the majority and dismiss the appeal with costs.
P.B.R. Appeal dismissed.

Output:
In March 1967, after obtaining the satisfaction of the Commissioner the appellant issued a notice under section 148 of the Income Tax Act, 1961 stating that he had reason to believe that the respondent 's income chargeable to tax for the assessment year 1958 59 had escaped assessment.
The respondent replied that the I.T.O. had no competence or jurisdiction to reopen the assessment under section 147 of the Act on a mere change of opinion.
Since there was no reply from the appellant, the respondent moved the High Court for a writ.
The High Court held that the conditions precedent for the exercise of jurisdiction by the Income Tax Officer were not fulfilled because the report submitted by the Income Tax Officer to the Commissioner under section 147(a) was defective.
On appeal to this Court it was contended that the High Court was not right in holding that the Income Tax Officer 's report was defective.
Dismissing the appeal, ^ HELD: The High Court was right in holding that the material before the Income Tax Officer could not have led to the formation of the belief that the income of the assessee had escaped assessment because of his failure or omission to disclose fully and truly all material facts.
[965H] 1.
(a) The two conditions required to be satisfied before the Income Tax Officer issued a notice under section 148 of the Income Tax Act are that he must have reason to believe (i) that the income chargeable to tax had escaped assessment and (ii) that such income had escaped assessment by reason of the omission or failure on the part of assessee, to disclose fully and truly material facts necessary for assessment for that year.
Both these conditions must co exist in order to confer jurisdiction on the Income Tax Officer.
Further the Income Tax Officer should record his reasons before initiating proceedings under section 148(2); before issuing the notice after the expiry of four years from the end of the relevant assessment year, the Commissioner should be satisfied on the reasons recorded by the Income Tax Officer that it was a fit case for the issue of such notice.
[962C D] (b) The duty cast upon the assessee does not extend beyond making a true and full disclosure of the primary facts.
It is then for the Income Tax Officer to draw the correct inference from the primary facts.
Where his inference subsequently appears to be erroneous, mere change of opinion with regard to that inference would not justify initiation of action for reopening the assessment.
[962F G] (c) The grounds or reasons leading to the formation of the belief under section 147(a) must have a material bearing on the question of escapement of income.
Once there exist reasonable grounds for the Income Tax Officer to form the above belief, that would be sufficient to clothe him with jurisdiction to issue notice.
While the sufficiency of grounds which induce the Income Tax Officer to act is not justiciable, it is open to the assessee to contend that the Income Tax Officer did not hold the belief that there was such non disclosure.
The expression "reason to believe" does not mean a purely subjective satisfaction on the part of the Income Tax Officer.
It is open to the Court to examine whether the reasons for the formation of the belief have a rational connection with or relevant bearing on the formation of the belief and are not extraneous or irrelevant for the purpose of the section.
[962H] 957 Chhugamal Rajpal vs section P. Chaliha , Calcutta Discount Co. Ltd. vs Income Tax Officer, 41 I.T.R. 191 and section Narayanappa & Ors.
vs Commissioner of Income Tax followed.
In the instant case the grounds given by the Income Tax Officer for reopening the assessment were (i) that the three persons whose names were mentioned in the list of creditors, were known name lenders and (ii) that another person shown as a creditor of the assessee had since confessed that he was doing only name lending.
The first ground mentioned by the Income Tax Officer could not have led to the formation of the belief that the income of the respondent had escaped assessment for that year because of his failure or omission to disclose fully and truly all material facts.
The High Court was justified in excluding that ground from consideration.
[963D E] As regards the second ground there is nothing to show that the confession of another person related to a loan to the assessee and not to someone else.
There is no indication as to when the confession was made and whether it related to the assessment year sought to be re opened.
To infer from that confession that it related to the period of assessment and that it pertained to the loan shown to have been advanced to the assessee would be far fetched.
[964G] 2(a).
Rational connection postulates that there must be a direct nexus or live link between the material coming to the notice of the Income Tax Officer and the formation of his belief that there had been escapement of income of the assessee from assessment in the particular year.
It is not any and every material, howsoever vague and indefinite or distant, remote and far fetched which would warrant the formation of the belief relating to escapement of the income of the assessee from assessment.
The fact that the words "definite information" in section 34 of 1922 Act before its amendment in 1948 do not find a place in section 147 would not lead to the conclusion that action could now be taken for reopening assessment even if the information was wholly vague, indefinite, far fetched and remote.
[965B D] (b) The powers of the Income Tax Officer to reopen assessment, though wide, are not plenary.
The words are "reason to believe" and not "reason to suspect".
The provisions of the Act depart from the normal rule that there should be finality about orders made in judicial and quasi judicial proceedings.
It is, therefore, essential that before such action is taken the requirement of the law should be satisfied.
[965E F] In the instant case the live link or close nexus between the material before the Income Tax Officer and the belief which he was to form regarding the escapement of the income was missing or at any rate the link was too tenuous to provide a legally sound basis for reopening the assessment.