Full Judgment Text
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PETITIONER:
THE STATE OF MADHYA PRADESH
Vs.
RESPONDENT:
SHRI MOUIA BUX AND OTHERS
DATE OF JUDGMENT:
05/05/1961
BENCH:
HIDAYATULLAH, M.
BENCH:
HIDAYATULLAH, M.
KAPUR, J.L.
SUBBARAO, K.
SHAH, J.C.
DAYAL, RAGHUBAR
CITATION:
1962 AIR 145 1962 SCR (2) 794
CITATOR INFO :
R 1985 SC 357 (15)
ACT:
Civil Procedure-Parties-Suit against Government of Part C
State-Authority to be named as defendant-Code of Civil
Procedure, 1908 (V of 1908), 8. 79-General Clauses Act, 1897
(X of 1897). 88. 3(8), 3(8); 3(58) and 3(60)-Government of
Part C States Act, 1951 (49 of 1951) s. 38 (2).
HEADNOTE:
The respondents obtained a lease for plucking tendu leaves
from the Government of Vindhya Pradesh. Later, the
Government cancelled the lease and sought to recover the
balance of the lease money. The respondents filed a suit
for damages and for injunction restraining the Government
from recovering the balance of the lease money and impleaded
the State of Vindhya Pradesh as the defendant. They
contended that the suit was incompetent as the proper
defendant was the Union of India and not the State of
Vindhya Pradesh.
Held, that the State of Vindhya Pradesh was the proper
defendant to be sued and that the suit was properly filed.
Under s. 3 (58 of the General Clauses Act "State" meant
inter alia a Part C State and under Art. 239 (1) the Part C
State was administered by a Lieutenant Governor if the
President so ordered. Thus Part C States had a separate
existence and were not merged with the Central Government.
Though ’State Government’ was defined by s. 3(60) ibid in
relation to a Part C State as the Central Government the
definition of ’Central Government’ in relation to the
administration of a Part C State meant the Lieutenant
Governor within the scope of the authority under Art. 239
and thus the State Government. Thus cl. (b) of s. 79
applied and not cl. (a).
Satya Deo v. Padam Deo, (1955) 1 S. C. R. 549, referred to.
JUDGMENT:
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CIVIL APPELLATE JURISDICTION : Civil Appeal No. 127 of 1959.
Appeal from the Judgment and decree dated February 2, 1956,
of the Court of the judicial Commissioner, Vindhya Pradesh,
in Review Application No. 15 of 1955,
795
B.Sen, B. K. B. Naidu and I. N. Shroff, for the
appellant.
G. C. Mathur, for the respondents.
1961. May 5. The Judgment of the Court was delivered by
HIDAYATULLAH, J. This is ,in appeal by the State of Madhya
Pradesh, which stands substituted for the State of Vindhya
Pradesh under the States Reorganisation, Act, 1956, and is.
directed against an order of the Judicial Commissioner,
Rewa, by which he modified, on reviews his judgement and
decree in a civil suit filed by the respondents against the
State of Vindhya Pradesh. The appeal has been filed on a
certificate granted by the Judicial Commissioner, Rewa.
The only question urged in this appeal is that the suit
brought against the State of Vindhya Pradesh was defective,
because the proper defendant was the Union of India. Since-
the question is one of law, it relieves us of the duty of
narrating all the facts. Briefly stated the suit was for
damages valued at Ls. 1,00,000/- and for a permanent
injunction against the State of Vindhya Pradesh. The suit
was filed in the following circumstances: The respondents
are bidi merchants, and for that purpose, had obtained on
October 18, 1951 from the Divisional Forest Officer, Rewa, a
lease for plucking and appropriating tendu leaves from. the
Makundpur Range for three years, commencing from October 18,
1951 on payment of Rs. 1,63,000/- per year (Ex. P. 85). For
some reasons into which it is not necessary to go, this
contract was cancelled, and the right was put up for
auction, but no bidders came. The Government therefore,
demanded the yearly instalments, claiming them under the
contract as the difference between the original contract
amount less the
796
amount fetched by way of fresh auction, which was nil. The
suit was filed for a perpetual injunction against this claim
and for damages on the averment that the State of Vindhya
Pradesh was guilty of breach of the contract.
The trial Judge decreed both the parts of the claim, placing
the damages at Rs. 36,570/-. Appeals were filed by both
sides before the Judicial Commissioner, the appeal of the
State Government was allowed and that of the plaintiffs
dismissed, resulting in the dismissal of the entire suit.
The Judicial Commissioner held that the State of Vindhya
Pradesh was not a juristic entity and the suit ought to have
been filed against the Union of India. On an application
for review the Judicial Commissioner held that there was an
error apparent on the face of his earlier judgment, and that
the State of Vindhya Pradesh could be legally sued. He
accordingly granted review, and modified his judgment’ and
decree by upholding, the claim for perpetual injunction, but
he dismissed the claim for damages on merits. It is against
this order that the present appeal has been fired with
certificate.
Prior to the formation of the State of Vindhya Pradesh, a
Union of 35 States in Baghelkhand and Bundelkhand had been
formed by the Rulers in March, 1948. On December 26, 1949,
this Union merged with India, and on January 22, 1950, the
United State of Vindhya Pradesh became a Chief
Commissioner’s Province under the Government of India Act,
1935. On the commencement of the Constitution, the Chief
Commissioner’s Province of Vindhya Pradesh became a Part C
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State administered by the President. In September, 1951 an
Act known as the Government of Part C States Act, 1951, was
passed by Parliament, and under it, a Lieutenant-Governor
was appointed for Vindhya Pradesh. In 1956, under the
States Reorganisation Act, 1956, this Part C State became a
part of the State of Madhya Pradesh.
797
The suit was filed on May 11, 1953, after notices under s.
80 of the Code of Civil Procedure were served, inter alia,
on the Secretary, Forests and Industries Department, Vindhya
Pradesh and the Collector of Rewa. The defendants raised
the plea for the first time in appeal before the Judicial
Commissioner that the suit was filed against a, wrong
defendant. According to them, the proper defendant was the
Union of India. The judicial Commissioner, relying upon
Art. 300 of the Constitution and the definition’ of "State"
in Art. 264, which did not include Part C States, held that
the State of Vindhya Pradesh was not a juristic entity, and
that the suit could not be filed against it. Later, on an
application for review, he held that Art. 300 was not
applicable to suits by or against Part C States, and he,
therefore, considered the matter in the light of s.79 of the
Code of Civil Procedure. Before him, a notification issued
by the President appointing the Lieutenant-Governor as a
person authorised under Order 27 of the Code of Civil
Procedure was produced, to which earlier his attention had
not been called. He, therefore, held that, in view of the
provisions of s. 79 and the definition of"’State Government"
in s. 3(60) of’ the General Clauses Act, the proper
defendant was, in fact, the State of Vindhya Pradesh. He
accordingly observed as follows
"The previous judgement of this Court was
based on the assumption that the State of
Vindhya Pradesh was not a legal entity, that
is, entity capable of holding property and of
entering into contracts. As has been shown
above this assumption was erroneous."
In the view of the matter, he reviewed his
order, with the result stated above.
The provisions which are material to, the,
discussion way now be set down. Section 79 of
the
798
Code of Civil Procedure lays down:
"79. In a suit by or against the Government,’
the authority to be named as plaintiff or
defendant, as the case may be, shall be-
(a) In the case of a suit by or against the
Central Government, the Union of India, and
(b) In the case of a suit by or against a
State Government, the State."
The following definitions in the General Clau-
ses Act, 1897, as they stood at the time, are
also relevant:
"3 (8) ’Central Government’ shall.-
(b) in relation to anything done or to be
done after the commencement of the Con-
stitution, mean the President;
and shall include-
(ii)in relation to the administration of a
Part C State, the Chief Commissioner or
Lieutenant-Governor acting within the scope of
the authority given to him or it under article
239 or article 243 of the Constitution, as the
case may be :"
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3 (58) "State’ shall mean a Part A State, a
Part B State or a Part C State
3 (60) ’State Government’,--
(b) as respects anything done or to be. done
after the commencement of the Constitution,
shall mean in a Part A State, the Governor, in
a Part B State, Rajpramukh, and in a ’Part C
State the Central Government : "
It is contended before us that s. 79, which lays down the
procedure for suits by or against
799
Government and the authority to be named as plaintiff or
defendant provides that(a) in the case of a suit by or
against the Central Government, the Union of India and (b)
in the case of a suit by or against the State Government,
the State, shall be-named as plaintiff or defendant, as the
case may be. It is contended that under the General Clauses
Act, s. 3 (8), "Central Government" means in relation to
anything done or to be done after the commencement of the
Constitution, the President, and under s. 3(60), "State
Government" means as respects anything done or to be done
after the commencement of Constitution, in the case of a
Part C State, the Central Government. The contention,
therefore, is that if the State Government means the Central
Government in the case of Part C States, then under cl. (a)
of s. 79 of the Code of Civil Procedure, the, proper party
to sue would be the Union of India. This argument was not
accepted by the Judicial Commissioner, and, in our opinion,
rightly.
The matter has to be looked at in this way. "State" is
defined by s. 3(58) as a Part A State or a Part B State or a
Part C State. This shows that wherever the word "’State" is
used, it includes a Part C State. In Satya Deo v. Padam Deo
(1) it has been held by this Court that Part C States bad a
separate existence and were not merged with the Central
Government. "State Government" is then defined in s. 3(60)
in relation to a Part C State, as the Central Government and
"Central Government" is defined in s. 3(8)(ii) as including
the Lieutenant-Governor acting within the scope of authority
given to him under Art. 239. Article 239 reads as follows
"239(1) Subject to the other provisions of
this Part, a State specified in Part C of the
First Schedule shall be administered by the
President acting, to such extent, as. he
(1) (1955) 1 S.C.R. 549.
800
thinks fit, through a Chief Commissioner or a
Lieutenant-Governor to be appointed by
him........"
The administration of a Part C State was thus being carried
on under the provisions of Art. 239, and, as has been
rightly pointed out by the Judicial Commissioner, was not
affected by Art. 300. On April 8, 1953, the President
issued the following notification
S. R. O. 699"-In pursuance of clause (1) of
Article 239 and clause (1) of Article 243 of
the Constitution, and in supersession of the
notification of the Government of India in the
late Home Department No. 204/37-Judicial,
dated the 5th May, 1938 and in partial
modification of the notification of the
Government of India in the Ministry of States
No. S. R. 0. 460 dated the 24th August, 1950,
in so far as it relates to the Civil Procedure
Code, 1908 (Act V of 1908), the President
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hereby directs that the functions assigned to
the Central Govern by Order XXVII of, the
First Schedule be discharged by the
Lieutenant-Governor or the Chief Commissioner
as the case may be, of every Part C State
except the State of Manipur, in respect of
such Part C State, and by the Cheif
Commissioner of the, Andaman and Nicobar
Islands in respect of those Islands."
In view of this notification, the Lieutenant Governor became
the proper authority under 0.27 of the Code Civil Procedure.
By virtue of the definitions of "State" and "Central
Government" read with the definition of "State Government",
the Lieutenant-Governor of the State was the proper party to
be sued. The Government of Vindhya Pradesh meant the
Lieutenant-Governor only by an amendment made in 1954 in.
the
801
Vindhya Pradesh General Clauses Act. Since the contract in
question was entered into by the Government of Vindhya
Pradesh and could not be construed as a contract with the
Central Government, see Staye Deo V. Padam Deo the suit had
to be brought against the State of Vindhya Pradesh, and the
State was the proper authority to be named tinder s. 79(b)
of the Code. In addition to this there was the Act called
the Government of Part C States Act, and under s. 38(2) of
that Act,’ all executive action of a Part C State was to be
expressed to be taken in the name of the Lieutenant-Governor
and the executive power of the Government was to be
exercised by him, including the grant, sale, disposition or
mortgage etc., of any property held for the poses of’ the
State. The combined effect of all these provisions was to
constitute the Part C State of Vindhy Pradesh into a
separate State, and under Art. 239, the administration of it
was to be done by the President through such person, as he
notified. Under the notification, the Lieutenant-Governor
was appointed as the person to discharge the functions under
0. 27 and under s. 38(2) of the Government of Part C States
Act he exercised the executive power of Government. The
Government of the State of Vindhya Pradesh entered into the
contract with the plaintiffs in respect of the property of
the State. The definitions to which we have referred, made
the State the proper authority to be sued, even though the
State Government was defined in the General Clauses Act as
the Central Government, because the definition of Central
Government" takes us to the Lieutenant-Governor, and from
the Lieutenant-Governor we go to the State. In this veiw of
the matter, s. 79(a) of the Code, which says that in a suit
by or against the Central Government, the proper plaintiff
or defendant, as the case may be, is the Union
(1) (1955) 1 S.C.R. 549.
802
of India, does not apply to a Part C State, and only the
definition in el. (b) of the section applies to this State,
even though a Part C State. In our opinion, therefore, the
decision of the Judicial Commissioner was correct.
Since no other point was urged in this appeal, it must fail,
and it is accordingly dismissed with costs. There is no
need to pass any order on C. M. P. No. 40 of 1960 by which
the respondents asked for amendment of the plaint and
addition of the Union Government as a party. The
application shall be filed.
Appeal dismissed
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