Full Judgment Text
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PETITIONER:
VIDYA SAGAR JOSHI
Vs.
RESPONDENT:
SURINDER NATH GAUTAM
DATE OF JUDGMENT:
13/09/1968
BENCH:
HIDAYATULLAH, M. (CJ)
BENCH:
HIDAYATULLAH, M. (CJ)
MITTER, G.K.
CITATION:
1969 AIR 288 1969 SCR (2) 84
CITATOR INFO :
RF 1971 SC 696 (20)
ACT:
Representation of People Act, 1951 (43 of 1951), ss. 77(3)
and 123(6)-Amount spent on seeking party ticket-Whether
expenditure-’Expenditure’, ’in connection with election’,
and ’incurred or authorised’, meaning of.
HEADNOTE:
The appellant applied for a Congress ticket for election to
the Legislative Assembly and deposited certain sums, which
according to the rules of the Congress Party was refundable
if the candidate was not selected but the deposit was to be
forfeited if he contested the election against the official
Congress candidate. The appellant was denied the
Congress ticket. Thereafter the notification inviting
electors to elect a member to the Assembly was issued, and
the last date for filing nomination papers and for
withdrawing from the contest was fixed. The appellant
contested the election against the respondent who was the
official Congress nominee and incurred the penalty of
forfeiture. The appellant was declared elected and he filed
his return of election expenses. The respondent challenged
the ’appellant’s election on the ground that he had
committed corrupt practice under s. 123(6) of the
Representation of People Act, 1951, for not having included
the sum deposited by him in seeking the Congress ticket in
his return and by adding this sum to the return of election
expenses filed the prescribed amount was exceeded, thereby
contravening s. 77(3) of Act. The High Court held in favour
of the election petitioner. Dismissing the appeal, this
Court,
HELD: Section 77 as framed now departs in language from
the earlier provision on the subject which was r. 117. The
words ’conduct ’and management of election’ are; not as wide
as the words ’all expenditure in connection with election
incurred or authorised by him’ which now find place in s. 77
with ’election’ and ’incurred or authorised.’ ’Expenditure’
means the amount expended and ’expended’ means to pay away,
lay out or spend. It really represents money out of pocket,
a going out. The amount paid away or paid out need not be
all money which a man spends on himself during this time.
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It is money ’in connection with’ his election. These words
mean not so much as ’consequent upon’ as ’having to do
with’. All money laid out and having to do with the
election is contemplated. But here again money which is
liable to be refunded is not to be taken note of. The word
’incurred’ shows a finality. It has the sense of rendering
one-self liable for the amount. The words are not
equivalent to ’conduct or management of an election’ and the
expenses need not be for promotion of the; interest of the
candidate. Therefore the section regards everything for
which the candidate has rendered himself liable and of which
he is out of pocket in connection with his election, that is
to say having to do with his election. [87 G---88 B]
(In this case, the appellant put out the money for his
election since he was trying to obtain a Congress ticket.
If he had got the ticket and the money was refunded to him,
this would not have counted as ’an expenditure since the
expense would not have been incurred. When the appellant
knowing that the money would be lost went on to stand as an
independent candidate, he was willing to let the money go
and take a
85
chance independently. So the ’amount was an expenditure
within the meaning of the section. [88 C-D]
Haji Aziz and Abdul Shakoor Bros. v. Commissioner of
Income-tax, Bombay City, [1961] 2 S.C.R. 651, distinguished.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 853 of 1968.
Appeal under section 116-A of the Representation of
the People Act, 1951 from the judgment and order dated
January 15, 1968 of the Delhi High Court, Himachal Bench in
C.O.P. No. 4 of 1967.
C.B. Agarwala, S.K. Bagga and S. Bagga, for the appellant.
Sarjoo Prasad and Naunit Lal, for the respondent.
The Judgment of the Court was delivered by
Hidayatullah, C.J. This is an appeal against the
judgment, dated January 15, 1968, of the High Court of Delhi
(Himachal Bench) setting aside the election of the appellant
to the Santokhgarh Assembly Constituency of Himachal
Pradesh. The election has been set aside on the ground of
corrupt practice under section 123(6) of the Representation
of People Act read with s. 98(b) of the Act.
By a notification dated January 13, 1967 the electors of
this constituency were invited to elect a member to the
Assembly. The the last date of withdrawal was January 23,
1967. Three candidates contested the election. The
appellant was an independent candidate opposed by the
respondent who was a Congress nominee and one Shanti Swarup,
Jansangh candidate. The poll took place throughout the
constituency on February 18, 1967. Votes were counted four
days later at Una and the result was declared at follows:
Vidya Sagar Joshi (Appellant) 8437 votes
Surinder Nath Gautam 7695 votes
(Election Petitioner)
Shanti Swarup 2067 votes
1267 ballots were rejected as invalid.Thus the present
appellant was returned with a margin of 742 votes. The
returned candidate filed his return of election expenses
showing an expenditure of Rs. 1,862.05P. The limit of
expenditure in this constituency was Rs. 2,000/-. One of
the contentions of the election petitioner was that he had
filed a false return of his election expenses, that he had
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spent .an amount exceeding Rs. 2,000/- in the aggregate and
therefore contravened the provisions of s. 77 (3)
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of the Representation of People Act, 1951 and therefore
committed corrupt practice under section l23(6) of the Act.
The election petitioner therefore asked that his election be
declared void. There were other grounds also on which the
election was challenged, but we need not refer to them
since no point has been made before us.
The main item on which the expenses were said to be
false was a deposit of Rs. 500/- as security and Rs. 200/-
as application fee which the returned candidate had made
with the Congress party on or before January 2, 1967. The
fee was not returnable, but as this payment was, made before
the notification calling upon the voters to elect a member
to the Assembly nothing turns upon it. The returned
candidate was denied the Congress ticket on or about January
10, 1967. This was also. before the said notification.
According to the rules of the Congress party the security
deposit was refundable to a candidate if he or she was not
selected.
It was however provided in the same rules that if the
candidate contested the election against the official
Congress candidate, the security deposit would be forfeited.
The returned candidate chose to stand as an independent
candidate against the official Congress nominee and
incurred the penalty of forfeiture. This was after the date
for the filing of the nomination paper (January 20, 1967).
He had time till January 23, 1967 to withdraw from the
contest. If he had done so the deposit would have
presumably been returned to him. As he became a contesting
candidate the forfeiture of the deposit became a fact.
The case of the election petitioner was that if this
deposit were added to the election expenses, the limit of
Rs. 2,000/- was exceeded and therefore this amounted to a
corrupt practice under section 123(6) read with s. 77(3) of
the Representation of People Act. The High Court held in
favour of the election petitioner and hence the appeal.
Section 77 of the Representation of People
Act provides as follows.:
Section 77. Account of election expenses
’and maximum thereof---
(1 ) Every candidate at an election
shall either by himself or by his. election
agent, keep a separate and correct account of
all expenditure in connection with the
election incurred or authorised by him or by
his election agent between the date of
publication of the notification calling the
election and the date of declaration of the
result thereof, both dates inclusive.
(2). The account shall contain such
particulars, as may be prescribed.
87
(3) The total of the said expenditure shall not
exceed such amount as may be prescribed.
The third sub-section creates a bar against expenditure
in excess of the prescribed amount. In this case the
prescribed amount was Rs. 2,000/-. Section 123(6) provides
that "the incurring or authorising of expenditure in
contravention of section 77 is a corrupt practice."
Therefore, if the amount of Rs. 500/was added to the
election expenses as declared by the returned candidate he
would be guilty of a corrupt practice, under the two
sections quoted above. The question, therefore, is whether
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this amount can be regarded as an election expense.
The first sub-section of s. 77 discloses what the
candidate has. to declare as part of his election expenses.
It speaks. of "all expenditure in connection with the
election incurred or authorised by him or by his election
agent between the date of publication of the notification
calling the election and the date of declaration of the
result thereof, both dates inclusive." In the present case,
therefore, the critical dates were January. 13, 1967 and
February 22, 1967. The amount in question was paid before
the first date. It was liable for confiscation not on the
date on which the Congress ticket was refused to the
returned candidate but on January 23, 1967 when he did not
withdraw from the’ contest and offered himself as a
contesting candidate against the official Congress
candidate. In other words, the payment was made before the
period marked out by s. 77 ( 1 ) but the expenditure became
a fact between the two. dates. The contention of the
returned candidate was that this was not an expenditure
within the meaning of s. 77(1) of the Representation of
People Act and this is the short question, which falls for
consideration in the present case.
Section 77 as flamed now departs in language from the
earlier provision on the subject which was rule 117. It
read:
"117. Maximum election expenses--No
expense shall be incurred or authorised by a
candidate or his election agent on account of
or in respect of the conduct and management of
an election in any one constituency in a State
in excess of the maximum amount specified in
respect of that constituency in Schedule V."
The words "conduct and management of election" are not as
wide as the words. "all expenditure in connection with
election incurred or authorised by him, "which now find
place in s. 77". The question thus is what meaning must be
given to the words used in s. 77. The critical words of s.
77 are ’expenditure’ ’in connection with election’ and
’incurred or authorized’. ’Expenditure’ means the amount
expended and ’expended’ means to. pay away, lay.. out or
spend. It really represents money out of pocket, a going
out.
88
Now the amount paid away or paid out need not be all money
which a man spends on himself during this time. It is money
in connection with’ his election. These words mean not so
much as ’consequent upon’ as ’having to do with’. All money
laid out and having to do. with the election is
contemplated. But here again money which is liable to be
refunded is not to be taken note of. The word ’incurred’
shows a finality. It has the sense of rendering oneself
liable for the amount. Therefore the section regards
everything for which the candidate has rendered himself
liable and of which he is out of pocket in connection with
his election that is to say having to do with his election.
The candidate here put out this money for his election
since he was trying to obtain a congress ticket. If he had
got the ticket and the money was refunded to. him, this
would not have counted as an expenditure since the expense
would not have been incurred. When the candidate knowing
that the money would be lost went on to stand as an
independent candidate, he was willing to let the money go
and take a chance independently. The case of the appellant
is that this money was not used in furthering the prospect
of his election. On the other hand, it was in fact used
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against him by the Congress Party as he was opposed to that
party’s candidate. He contends that such an expense cannot
be regarded as expense in connection with the election.
According to him the connection must be a connection of
utility and not something which is of no use but rather
against the chances of victory. In this connection the
learned counsel draws our attention to Halsbury’s Laws of
England, Third Edition Volume 14, at page 177 paragraph 314.
It is stated there as follows:
"While no attempt has been made by
judges to define exhaustively the meaning of
expenses incurred in the conduct or management
of an election, it has been said that if
expenses are, primarily or principally,
expenses incurred for the promotion of the
interests of the candidate, they are election
expenses."
It will be seen that the above passage
refers to expenses incurred in the conduct or
management of an election.
The learned counsel for the appellant and respondent
relied upon two decisions of this Court. Reliance was also
placed upon two decisions of the Election Tribunals. The
decisions of the Election Tribunal are of the same Bench and
concern Rule 117. They need not be considered. The two
cases of this Court may be noticed.
In Haji Aziz and Abdul Shakoor Bros. v. Commissioner of
Income Tax, Bombay City(1) the question arose under the
Indian
(1) [1961] 2 S.C.R. 651.
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Income-tax Act. A firm importing dates was found to have
breached some law and a penalty was imposed on it under the
Sea Customs Act. The firm sought to treat the penalty as
expenses and they were disallowed by this Court. Learned
Counsel for the appellant relied on this case and claimed
that the same principle applies and this penalty cannot be
said to be an expenditure in connection with the election.
The analogy is not apt because not only the prescriptions of
the two laws are different but the underlying principle is
different also. In Income tax laws the expenditure must be
laid out wholly or exclusively for the purpose of the
business etc. Breaking laws and incurring penalty is not
carrying on ’business and therefore the loss is not for the
purposes of business. Here the expenditure is to be
included if it is incurred in connection with the election
and the payment to secure the seat is an expenditure in
connection with the election. The ruling therefore, does
not apply.
In the second case a congress candidate had paid a sum
of Rs. 500/- of which Rs. 100/- were subscription for
membership and Rs. 400/- were a deposit. Later he paid Rs.
500/- as donation to the Congress. He failed to include
the two sums of Rs. 500/- each in his return of expenses.
The Tribunal found that both the sums were spent in
connection with the election and by including them the limit
was exceeded. This Court affirmed the decision of the
Tribunal. The case was decided under r. 117. The two sums
were considered separately. The contention was that under
section 123 (7) and r. 117 the candidate was nominated only
on November 16, 1951 and the first sum was paid on
September 12, 1951. The question then arose when the
candidate became a candidate for the application of the Rule
and section 123(7). It was held that the candidate became a
candidate when he unequivocally expressed his intention by
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making the payment.
The question of commencement of the candidature is now
obviated by prescribing the two terminii between which the
expense is to be counted. In so far as the case goes it
supports our view. It is risky to quote the decision because
the terms of the law on which it was declared were entirely
different. We can only say that there is nothing in it
which militates against the view taken by us here.
On the whole, therefore, the judgment under appeal is
correct. The appeal fails and will be dismissed with costs.
y.p. Appeal dismissed.
2Sup.CI/69- 7
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