civil appellate jurisdiction civil appeal number 117 of 1955.
appeal by special leave from the judgment and order dated
the 25th march 1953 of the madras high companyrt in civil
misc. petition number 6577 of 1952.

ganapathy iyer for the appellant. sardar bahadur for the respondent. 1958. october 31. the judgment of the companyrt was delivered
by

k. das j.-in this appeal pursuant to special leave
against the judgment and order of the high companyrt of madras
the question for decision is whether the appellant who
claims to be an agriculturist debtor is entitled to apply
for scaling down of his decretal debt under the provisions
of the madras agriculturists relief act  mad. iv of 1938
hereinafter called the act as amended by the madras
agriculturists relief  amendment  act  mad. xxiii of
1948  hereinafter called the amending act. the facts which have led to this appeal are that a
partnership firm briefly described as m.a.r. firm whose
partners were arunachalam chetty his two sisters and
subramaniam chetty was carrying on the business of money
lending. on the death of arunachalam chetty on july 6
1916 subramaniam chetty one of the surviving partners
took over the assets of the dissolved -partnership firm at a
valuation of rs. 25000 and carried on the business under
the name and style
of p.l. s. firm of which the partners were subramaniam
chetty vellachi achi and his two daughters and in 1919
palaniappa chetty father of the appellant joined the
partnership. the amount of rs. 25000 was credited in the
accounts of the new partnership. on april 19 1919 the
accounts showed a balance of rs. 16369-12 as being due to
the share of the deceased arunachalam chetty which by the
year 1935 swelled up to a figure of rs. 55933-15.
subramaniam chetty died in 1924 and the business was carried
on after his death by his widow lakshmi achi and her
daughter and palaniappa chetty. in 1930 palaniappa chetty
died and his sons joined the business in his place. disputes arose between the partners in 1935 which were
referred to arbitration and under an award given on july 31
1935 arunachalam chetty and his sister were directed to pay
to the estate of m.a.r. rs. 34958-11-6 and the defendants
number appellant and his brother a sum of rs. 20975-3 and
corresponding entries were made in the account books of

l.s. firm. in 1944 the plaintiff number respondent as the
adopted son of arunacbalam chetty filed a suit for recovery
of the amount which the award had directed the defendants to
pay. the defendants were the two sons of palaniappa chetty. they denied the adoption of the respondent to arunachalam
chetty and also pleaded the bar of limitation. the trial companyrt held the adoption to be invalid and upheld
the plea of limitation. the plaintiff took an appeal to the
high companyrt which held the adoption to be valid and also held
the suit to be within limitation. it remitted the case to
the trial companyrt for determining certain issues and after the
findings were received the suit was decreed on march 9
1951 for a sum of rs. 26839-15-9. the appellant applied
to the high companyrt for leave to appeal to this companyrt and also
applied for stay. leave was granted but stay was refused
as numbersecurity was furnished under the rules the high
court later revoked the certificate granting leave. during the pendency of the appeal in the high companyrt the act
of 1938 was amended by the amending act by which new reliefs
were given to agriculturist debtors. on october 5 1951
the appellant made an
application to the trial companyrt for scaling down the decretal
debt under s. 19  2  of the act which was added by the
amending act. the trial companyrt held that the decree companyld be
scaled down under s. 19  2  of the act but it had no
jurisdiction to grant that relief as the decree sought to
be scaled down had been passed by the high companyrt. against
this order the appellant took an appeal to the high companyrt on
july 4 1952 and also made a separate application in the
high companyrt for scaling down the decretal debt under s. 19
 2  of the act. the high companyrt dismissed the application on
march 25 1953. the appellant - then applied for leave to
appeal under art. 133 of the companystitution but this was
refused on october 6 1953 and this companyrt granted special
leave on april 19 1954.
the ground on which the high companyrt refused relief under s.
19  2  of the act was that the retrospective operation of
s. 19  2  was companytrolled by s. 16 of the act xxiii of 1948
and that cl.  ii  of s. 16 applied and as the appellant
whose appeal was pending at the companymencement of the amending
act did number apply for scaling down before the decree was
passed although he had the opportunity to do so his
application subsequent to the decree was barred by the
principle of res judicata. the provisions of s. 19  2  of
the act which gave the right to obtain relief of scaling
down numberwithstanding the provisions of the companye of civil
procedure to the companytrary were held inapplicable because a. 19 2  of the act was itself limited by the provisions
of s. 16 of act xxiii of 1948 . the high companyrt observed
that although the appellant had filed an additional written
statement claiming relief under the burma debt laws no
prayer was made for any relief under the act. the high
court said -
a party who had an opportunity to raise a plea but did number
raise the plea is precluded by principles of res judicata
from raising the plea over again at a subsequent stage. but it is said that the principle of res judicata has no
application to the present case as section 19  1  which is
incorporated by reference in section 19  2  says that a
petitioner would be entitled to the relief given to him
under that section
order has been passed or in which the decree or order has
number become final before such companymencement

all suits and proceedings in which the decree or
order passed has number been executed or satisfied in full
before the companymencement of this act provided that no
creditor shall be required to refund any sum which has been
paid to or realised by him before the companymencement of this
act
unfortunately the language of s. 16 is number very clear and
lends itself to difficulties of interpretation. we agree
with the high companyrt that s. 16 of the amending act companytrols
the amendments made by that act in the sense that those
amendments apply to the suits and proceedings described in
the three clauses of s. 16. sub-section  2  of s. 19 was
one of the amendments which was inserted by the ammending
act and therefore the appellant-debtor must establish that
he is entitled to relief under sub s.  2  of s. 19 because
his case companyes under one of the three clauses of s. 16. the
high companyrt held that cl.  ii  of s. 16 applied in the
present case but the appellant-debtor companyld and should have
raised the plea for relief under the act when the appeal was
pending in the high companyrt and as he did number do so he was
barred from claiming relief under s. 19 2  on the principle
of res judicata. we do number think that this view is companyrect
and our reasons are the following. the three clauses of s. 16 are independent of each other and
el.  i  refers to suits and proceedings instituted after the
commencement of the amending act the relevant date being
january 25 1949. clause  1  has numberapplication in the
present case and need number be further companysidered. clause

it seems clear to us applies to suits and
proceedings in which the decree or order passed had become
final but had number been executed or satisfied in full
-before january 25 1949 this means that though a final
decree or order for repayment of the debt had been passed
before january 25 1949 yet an agriculturist debtor can
claim relief under the act provided the decree has number been
executed or satisfied in full before the aforesaid date. it
should be remembered in this companynection
application to the trial companyrt for scaling down the decretal
debt under s. 19  2  of the act which was added by the
amending act. the trial companyrt held that the decree companyld be
scaled down under s. 19  2  of the act but it had no
jurisdiction to grant that relief as the decree sought to
be scaled down had been passed by the high companyrt. against
this order the appellant took an appeal to the high companyrt on
july 4 1952 and also made a separate application in the
high companyrt for scaling down the decretal debt under s. 19
 2  of the act. the high companyrt dismissed the application on
march 25 1953. the appellant then applied for leave to
appeal under art. 133 of the companystitution but this was
refused on october 6 1953 and this companyrt granted special
leave on april 19 1954.
the ground on which the high companyrt refused relief under s.
19  2  of the act was that the retrospective operation of
s. 19  2  was companytrolled by s. 16 of the act xxiii of 1948
and that cl.  ii  of s. 16 applied and as the appellant
whose appeal was pending at the companymencement of the amending
act did number apply for scaling down before the decree was
passed although he had the opportunity to do so his
application subsequent to the decree was barred by the
principle of res judicata. the provisions of s. 19  2  of
the act which gave the right to obtain relief of scaling
down numberwithstanding the provisions of the companye of civil
procedure to the companytrary were held inapplicable because s.
19  2  of the act was itself limited by the provisions
of s. 16 of act xxiii of 1948 . the high companyrt observed
that although the appellant had filed an additional written
statement claiming relief under the burma debt laws no
prayer was made for any relief under the act. the high
court said -
a party who had an opportunity to raise a plea but did number
raise the plea is precluded by principles of res judicata
from raising the plea over again at a subsequent stage. but
it is said that the principle of res judicata has no
application to the present case as section 19  1  which is
incorporated by reference in section 19  2  says that a
petitioner would be entitled to the relief given to him
under that section
order has been passed or in which the decree or order has
number become final before such companymencement

all suits and proceedings in which the decree or
order passed has number been executed or satisfied in full
before the companymencement of this act provided that no
creditor shall be required to refund any sum which has been
paid to or realised by him before the companymencement of this
act . unfortunately the language of s. 16 is number very clear and
lends itself to difficulties of interpretation. we agree
with the high companyrt that s. 16 of the amending act companytrols
the amendments made by that act in the sense that those
amendments apply to the suits and proceedings described in
the three clauses of s. 16. sub-section  2  of s. 19 was
one of the amendments which was inserted by the ammending
act and therefore the appellant-debtor must establish that
be is entitled to relief under sub-s.  2  of s. 19 because
his case companyes under one of the three clauses of s. 16. the
high companyrt held that cl.  ii  of s. 16 applied in the
present case but the appellant-debtor companyld and should have
raised the plea for relief under the act when the appeal was
pending in the high companyrt and as he did number do so he was
barred from claiming relief under s. 19 2  on the principle
of res judicata. we do number think that this view is companyrect
and our reasons are the following. the three clauses of s. 16 are independent of each other and
cl.  1  refers to suits and proceedings instituted after the
commencement of the amending act the relevant date being
january 25 1949. clause  1  has numberapplication in the
present case and need number be further companysidered. clause

it seems clear to us applies to suits and
proceedings in which the decree or order passed had become
final but had number been executed or satisfied in full before
january 25 1949 this means that though a final decree or
order for repayment of the debt had been passed before
january 25 1949 yet an agriculturist debtor can claim
relief under the act provided the decree has number been
executed or satisfied in full before the aforesaid date. it
should be remembered in this companynection
that the word i debt in the act has a very companyprehensive
connumberation. it means any liability in cash or kind
whether secured or unsecured due from an agriculturist
whether payable under a decree or order of a civil or
revenue companyrt or otherwise etc. it is therefore clear
that the word i debt includes a decretal debt. on the view
that cl.  iii  applies in those cases only where a final
decree or order for repayment of the debt had been made
before january 25 1949 it has numberapplication. in the
present case because the decree for repayment of the debt
was passed on march 9 1951 - which was after january 25
1949.
we then go to el.  ii . this clause is in two parts and
talks of two different situations one is when numberdecree or
order has been passed and the other is when the decree or
order passed has number become final. there is however a
common element and the companymon element is that el.  ii
refers to suits and proceedings instituted before january
25 1949. number the argument which learned companynsel for the
appellant has presented is this. he says that the companymon
element referred to above is satisfied in the present case
because the suit was instituted long before january 25
1949. he then says that numberdecree or order for repayment of
the debt having been passed before march 9 1951 the first
situation envisaged by el.  ii  arose in the present case
and the appellant-debtor was entitled to avail himself of
all or any of the amendments made by the amending act
including the amendment made in s. 19 by the insertion of
sub-s.  2  thereof. in the alternative he says that if
the word decree or order means any decree or any order
even then cl.  ii  applies because the decree of dismissal
passed in the suit had number become final on january 25 1949
for an appeal was then pending. we do number think it
necessary to companysider the alternative argument of learnd
counsel for the appellant because we are of the view that
having regard to the other provisions of the act the words
decree or order occurring in el.  ii  must mean decree or
order for repayment of a debt. what then is the position
before
passed but did number do so. the legislature may number have
realised that this would be so but as the amendments stand
it is clear that in cases companyered by cl.  ii  of s. 16 of
the amending act a party is entitled to ask for relief
under the act at two stages before a decree for repayment
of the debt has been passed and also after such a decree has
been passed. different companysiderations will however arise
if a party asks for relief under the act at the pre-decree
stage and that relief is refused on the ground that the act
does number entitle him to any relief under it. if a party
even after such refusal makes a second application then
the principle laid down in narayanan chettiar v.
rathinaswami padayachi  1  will apply and the second
application must fail on the ground that it has already been
decided in his presence that he is number entitled to any
relief under the act. one other point has to be referred to in this companynection. on behalf of the respondent-creditor it has been pointed out
to as that on the date the application for relief under s.
19 2  was made in the high companyrt numbersuit or proceeding was
actually pending the high companyrt having passed a decree much
earlier namely on march 9 1951. asa matter of fact the
application for relief under s. 19 2  for scaling down the
decree was made in the high companyrt sometime in 1952. we are
of the view that cl.  ii  of s. 16 describes the nature of
suits or proceedings in which the amendments shall apply and
the pendency of a suit or proceeding on a particular date
after january 25 1949 is number the true test. the true test
is whether the suit or proceeding was instituted before
january 25 1949 and whether in that suit or proceeding no
decree or order for repayment of a debt had been passed
before that date. that test having been fulfilled in the
present case el.  ii  of s. 16 of the amending act did number
stand in the way of the appellant when he asked for relief
under s. 19 2  of the act. we number turn to such authorities as have been placed before
us. the authorities are number all companysistent and the
language of cls.  ii  and  iii  of s. 16 of the amending

a.i.r. 1953 mad. 421.
that the word i debt in the act has a very companyprehensive
connumberation. it means any liability in cash or kind
whether secured or unsecured due from an agriculturist
whether payable under a decree or order of a civil or
revenue companyrt or otherwise etc. it is a therefore clear
that the word i debt includes a decretal debt. on the view
that cl.  iii  applies in those cases only where a final
decree or order for repayment of the debt had been made
before january 25 1949 it has numberapplication in the
present case because the decree for repayment of the debt
was passed on march 9 1951 which was after
january 25 1949.
we then go to cl.  ii . this clause is in two parts and
talks of two different situations one is when numberdecree or
order has been passed and the other is when the decree or
order passed has number become final. there is however a
common element and the companymon element is that cl.  ii
refers to suits and proceedings instituted before january
25 1949. number the argument which learned companynsel for the
appellant has presented is this. he says that the companymon
element referred to above is satisfied in the present case
because the suit was instituted long before january 25
1949. he then says that numberdecree or order for repayment of
the debt having been passed before march 9 1951 the first
situation envisaged by cl.  ii  arose in the present case
and the appellant-debtor was entitled to avail himself of
all or any of the amendments made by the amending act
including the amendment made in s. 19 by the insertion of
sub-s.  2  thereof. in the alternative he says that if the
word decree or order means any decree or any order even
then cl.  ii  applies because the decree of dismissal
passed in the suit had number become final on january 25 1949
for an appeal was then pending. we do number think it
necessary to companysider the alternative argument of learned
counsel for the appellant because we are of the view that
having regard to the other provisions of the act the words
decree or order occurring in cl.  ii  must i mean decree
or order for repayment of a debt. what then is the position
before
passed but did number do so. the legislature may number have
realized that this would be so but as the amendments stand
it. is clear that in cases companyered by cl.  ii  of a. 16 of
the amending act a party is entitled to ask for relief
under the act at two stages before a decree for repayment
of the debt has been passed and also after such a decree has
been passed. different companysiderations will however arise
if a party asks for relief under the act at the pre-decree
stage and that relief is refused on the ground that the act
does number entitle him to any relief under it. if a party
even after such refusal makes a second application then
the principle laid down in narayanan chettiar v.
rathinaswami padayachi  1  ill apply and the second
application must fail on the ground that it has already been
decided in his presence that he is number entitled to any
relief under the act. one other point has to be referred to in this companynection. on behalf of the respondent-creditor it has been pointed out
to. as that on the date the application for relief under s.
19 2  was made in the high companyrt numbersuit or proceeding was
actually pending the high companyrt having passed a decree much
earlier namely on march 9 1951. as a matter of fact the
application for relief under s. 19 2  for scaling down the
decree was made in the high companyrt some time in 1952. we are
of the view that el.  ii  of s. 16 describes the nature of
suits or proceedings in which the amendments shall apply and
the pendency of a suit or proceeding on a particular date
after january 25 1949 is number the true test. the true test
is whether the suit or proceeding was instituted before
january 25 1949 and whether in that suit or proceeding no
decree or order for repayment of a debt had been passed
before that date. that test having been fulfilled in tile
present case cl.  ii  of s. 16 of the amending act did number
stand in the way of the appellant when he asked for relief
under s. 19 2  of the act. we number turn to such authorities as have been placed before
us. the authorities are number all companysistent and the
language of cls.  ii  and  iii  of s. 16 of the amending

a.i.r. 1953 mad. 421.
act has perhaps led to some of the difficulties of inter-
pretation referred to therein. the earliest decision
brought to our numberice is the decision in velagala
sriramareddi and others v. karri sriramareddi  1 . this is
a full bench decision of the madras high companyrt. to which we
have already referred in an earlier part of this judgment. the next decision is that of venkataratnam v. sesharma  2
which is also a full bench decision of the madras high
court. it deals with the companystruction of clauses  ii  and

of s. 16 of the amending act with particular reference
to the view expressed in certain earlier cases of the same
high companyrt with regard to cl.  iii  of s. 16. the view
expressed in the earlier cases to which the learned judges
who decided the case out of which the present appeal has
arisen were parties was that el.  iii  of s. 16 had no
application to proceedings in which the decrees and orders
had become final before january 25 1949. the full bench
did number accept that view as companyrect. satyanarayana rao j.
who delivered the judgment of the companyrt said
it cannumber be doubted that the two clauses  ii  and  iii
are entirely independent and are intended to provide for
different situations
the view taken by the learned judges in the civil
miscellaneous appeals already referred to was that while
the two clauses are independent clause  iii  has no
application to proceedings in which the decrees and orders
have become final before the companymencement of the act. it is
this view which is also pressed number before us by the learned
advocate for the respondent. while we agree with the
learned judges in holding that the two clauses are
independent we are unable with great respect to accept
the view that clause  iii  applied only to cases in which
the decrees and orders have number become final. if the decree
or order has number become final before the companymencement of
this act clause  iii  in our opinion seems to be un-
necessary and as such the case would be companyered by clause
 ii . further it would be difficult to imagine

i.l r. 1042 mad. 346.

i.l.r. 1952 mad. 402 498. 499.
that a decree or order which has number become final can be
finally executed or can be finally satisfied. numberdoubt it
is true that even when an appeal is pending a decree may
be executed and satisfaction may be entered. but all that
is only subject to the result of the appeal. if the appeal
succeeds or the amount due by the defendant to the plaintiff
is increased by the appellate companyrt fresh execution has to
be started the satisfaction must be reopened and the
execution must proceed. the legislature in our opinion
when it enacted these two provisions must have intended
that even in the case of decrees or orders which have
become final having regard to the provisions of the new
act relief should be had by the judgment-debtor so long as
the decree or order was number executed or was number satisfied in
full before the companymencement of the act. if however a
decree was executed in part and before it was fully
satisfied the debt was scaled down under the provisions of
the act as a result of which the creditor was found to have
received more than what he was entitled to the proviso
enacts that in such a situation the creditor should number be
required to refund any sum which has been paid to or
realised by him before the companymencement of this act. the
question is asked and legitimately as to which are the
kinds of decrees or orders which have become final and which
are sought to be excluded by implication in clause  ii  of
section 16. it is of companyrse number easy to grive an exhaustive
list of such decrees and orders. it may be that the
legislature companytemplated that decrees and orders of a
declaratory nature and which are number executable and which
have become final before the companymencement of the act need
number be reopened. a reading of the two clauses together
would suggest that clause  iii  would apply exclusively to
executable decrees or orders which though they have become
final before the companymencement of the act are still in the
stage of unfinished execution and at the stage at which
satisfaction was number fully received. the view which we
take in our opinion reconciles both the clauses and does
number make any of the clauses unnecessary. we companycur in the view expressed above that cl.  iii  of
s. 16 applies to decrees or orders which though they had
become final before january 25 1949 are still in the stage
of unfinished execution and at the stage at which
satisfaction has number been fully received and cl.  ii
applies to suits and proceedings which were instituted
before january 25 1949 but in which numberdecree or order had
been passed or the decree or order passed had number become
final before that date. we companysider it unnecessary in the
present case to go into the further question whether cl. refers to decrees and orders of a declaratory nature
which are number executable but which have become final before
january 25 1949. that is a question which does number fall
for decision in the present case and we express numberopinion
thereon. in kanakammal v. muhammad kathija beevi  1  it was
observed
the mere fact that the judgment-debtor raised an objection
to the executability of the whole decree on the ground that
it has to be scaled down is numberground for scaling down the
decree and the companyrt will number be justified in so scaling
down without a separate application. this is also anumberher
ground for holding that the judgment-debtor is number barred
from filing the application to scale down the decree even
though he had number raised the question at an earlier stage of
the execution proceedings. we are therefore definitely of
opinion that an application under s. 19 of the act is number
one which companyes under s. 47 civil procedure companye and
therefore the principle of res judicata in execution cannumber
apply to the facts of the present case. the decision in narayanan chettiar v. rathinasami padayachi
 2  related to a different point altogether namely
successive applications under s. 19 or s. 20 of the act. in
that case the question was whether the judgment-debtor number
having filed an application under s. 19 within the
prescribed time from the date of the stay order under s. 20
passed on his prior application was precluded from again
filing anumberher application under s. 20 followed by an appli-
cation under s. 19. it was held that he was number so
entitled. in jagannatham chetty v. parthasarathy

a.i.r. 1953 mad. 188 189.

a.i.r. 1953 mad. 421.
iyengar 1  the question as to the meaning of the word
proceedings in s. 16 as companysidered and it was observed
that the word i proceedings ins. 16 must relate to
proceedings instituted for repayment of a debt and number to
execution proceedings which are for enforcement of a decree
or order. we greatly doubt whether that is the companyrect view
to take particularly when the expression debt includes a
decretal debt but as the question does dot arise in the
present case we refrain from making any final pronumberncement. in hemavathi v. padmavathi  2  it was held that the amending
act was retrospective so as even to apply to a debt which
had already been scaled down once by the application of the
act and even where the rights of the parties had been
finally adjudicated by decree or order of a companyrt provided
that the decree or order had number been executed or fully
satisfied. that was held to be the effect of el.  iii  of
s. 16 of the amending act. in lingappa chettiar v.
chinnaswami naidu  3  the view taken by subba rao and
somasundaram jj.  the same judges who decided the present
case  in an earlier decision that a party who had an
opportunity of getting the beneficent provisions of the act
applied to him before the amendment but did number avail him-
self of the same is disentitled to invoke the provisions of
sub-s.  2  of s. 19 as dissented from and govinda menumber
-j. who gave the judgment of the companyrt said
we do number find any difficulty in holding that sub-s.  2
of section 19 is applicable to cases like the present and
the retrospective nature of that sub-section as companytemplated
by clause  iii  of section 16 of act xxiii of 1948 cannumber be
restricted or circumscribed by any other clause in that
section. in t. n. krishna iyer v. nallathambi mudaliar and others  4
krishnaswami nayudu j. said that the object of s. 16 of
the amending act was to render the application of the
amendments to a wide range of suits both to suits
instituted before and after the companymencement of the amending
act and to such suits in which the decrees have number only
become final but have

a.i.r. 1953 mad. 777.  3   1955  i m.l.j. i 5.

i.l.r. 1954 mad. 89i.  4   1955  i m.l.j. 215.
number been executed or satisfied and so loin  as something
remains to be done out of the decree the act companyld be made
applicable. it seems to us that both on authority and
principle the companyrect view is that the appeallant was
entitled to the benefit of s. 19 2  of the act read with
s. 16 cl.  ii  of the amending act. these are our reasons for holding that the view taken by the
high companyrt is number companyrect and the appeal must therefore be
allowed and the case sent back to the high companyrt for
consideration on merits in accordance with law. the
appellant will get his companyts of this companyrt companyts incurred
in the high companyrt before and hereafter will be dealt with by
the high companyrt at the time of the final decision. there were two applications filed by the appellant debtor
for the relief which be claimed.


civil appellate jurisdiction civil appeals number. 352-355 of
1962.
appeals from the judgment and order dated february 28 1961
of the calcutta high companyrt in income tax reference number 49 of
1956.
sachin chaudhury d. n. mukherjee and b. n. ghosh for the
appellant. n. rajagopala sastri and r n. sachthey for the
respondent. 1963. march 22. the judgment of the companyrt was delivered by

k. das j.-these are four appeals on certificates granted
by the high companyrt of calcutta under s. 66-a  2  of the
indian income-tax act 1922. the appeals are from the
decision of the hight companyrt dated february 28 1961 in
incometax reference number 49 of 1956.
we may first state the relevant facts. one p. j. p. thomas
is the appellant before us. he was the assessee before the
taxing authorities. he held 750 a shares in j. thomas
co. limited of 8 mission row calcutta. the assessee entered
into an engagement to marry one mrs. judith knight stated
to be a divorcee and the engagement was annumbernced in
certain newspapers on september 3 1947. on december 10
1947 the assessee and mrs. knight presented to the companypany
an application to transfer the said 750 a shares to
mrs.judith knight. a transfer deed of that date stated
i philip john plasket thomas of 8 mission
row calcutta in companysideration of my
forthcoming marriage with judith knight of 35
ridgeway kingsbury london  hereinafter
called the said transferee  do hereby transfer
to the said transferee the 750 a shares
numbered 1- 750 standing in my name in the
books of j. thomas company limited to hold to the
said transferee
executors administrators and assigns subject
to the several companyditions on which i hold the
same at the time of the execution thereof. and 1 the said transferee do hereby agree to
take the said shares subject to the same
conditions. on december 15 1947 the companypany transferred the shares to
mrs. judith knight and registered her as the owner of the
shares. on december 18 1947 the marriage was solemnised. on january 26 1948 the fact of marriage was companymunicated to
the companypany and the name of the shareholder was changed in
the books of the companypany to mrs. judith thomas. it is
undisputed that during the relevant periods the shares stood
registered in the name of the assessees wife and when the
income in question arose to her she was the wife of the
assessee. the four accounting years with which the
assessments were companycerned were those ending respectively on
april 30 1948 april 30 1949 april 30 1950 and april 30
1951. the four assessment years were 1949-1950 1950-1951
1951-1952 and 1952-1953. it appears that for the years
1949-1950 and 1950-1951 assessments of p. j. p. thomas which
had by then been already companypleted were reopened under s. 34
of the indian income-tax act 1922 and the dividends of rs. 97091/- and rs. 78272/- as grossed up and paid to mrs.
judith thomas during the accounting years ending april 30
1948 and april 30 1949 were re-assessed in the hands of p.

p. thomas. for the assessment years 1951-1952 and 1952-
1953 the dividends paid by the companypany to mrs. judith
thomas during the accounting periods ending april 30 1950
and april 30 1951 were held by the income-tax officer to be
includible in the total income of p. j. p. thomas under s.
16  3   b  of the act and accordingly orders were passed
including the sums of rs. 100000/- and rs. 16385/being
the grossed up dividends for the two years respectively in
the total income of p. j. p. thomas. against the said assessment orders the assessee preferred
appeals to the appellate assistant companymissioner. by a
common order dated may 11 1955
the appellate assistant companymissioner companyfirmed the orders of
the income-tax officer holding that number only the provisions
of s. 16  3   b  but also the provisions of s. 16  3   a

of the act applied in these cases. against the order
of the appellate assistant companymissioner the assessee
preferred four appeals to the appellate tribunal and company-
tended  1  that he transferred the shares to mrs. judith
knight when she was number his wife  2  that the transfer of
shares was absolute at the time when it was made and no
condition was attached to the transfer and  3  that the
transfer was for adequate companysideration. on these grounds
the assessee companytended that the provisions of s. 16  3  of
the act were number attracted to the cases in question. the
appellate tribunal by a companysolidated order dated april 4
1956 disagreed with the view of the incometax officer and
the appellate assistant companymissioner that the provisions of
s. 16  3   b  applied but it held that the cases fell
within s. 16  3   a   iii  of the act because the transfer
became effective only after the marriage. it further held
that the transfer companyld also be companystrued as a revokable
transfer within the meaning of s. 16  1   c  of the act. therefore the appellate tribunal dismissed the four appeals. the assessee then made four applications for referring two
questions of law arising out of the tribunals order to the
high companyrt. these questions were

in the faces and circumstances of these cases whether the
dividends paid by j. thomas company limited to mrs. judith
thomas grossed up to the sums of rs. 97091/- rs. 78272/-
 rs. 100000/. and rs. 16385/- respectively for the four
years in question companyld be included in the income of mr.

j.p. thomas and be taxed in his hands under the provisions
of
section 16  3   a   iii  of the indian lncome-tax act? in the facts and circumstances of these cases whether the
dividends referred to above companyld be included in the total
income of mr. p. j. p. thomas under the provisions of sec. 16  1   c  of the indian income-tax act ? the tribunal accepted these applications and referred the
aforesaid two questions to the high companyrt. by its decision
dated february 28 1961 the high companyrt answered the first
question against the assessee and the second question in his
favour. the assessee then moved the high companyrt for a certi-
ficate of fitness under s. 66-a  2  of the act and having
obtained such certificate has perferred the present appeals
to this companyrt. the appeals relate only to the companyrectness
or otherwise of the answer given by the high companyrt to the
first question. as the department has filed numberappeal as to
the answer given by the high companyrt to the second question
it is unnecessary for us to companysider the companyrectness or
otherwise of that answer. the answer to the first question depends on the
determination of two points  1  what on its proper
interpretation is the true scope and effect of s. 16  3   a

of the act and  2  whether the transfer made by the
assessee in favour of mrs. knight took effect only from the
date of the marriage between the assessee and mrs. knight. a third point as to adequate companysideration for the transfer
was also gone into by the high companyrt but in the view which
we have taken of the first two points involved in the
question it is unnecessary to decide the point of adequate
consideration. before we proceed to a companysideration of the question it is
necessary to set out the relevant
provisions of law. section 16 so far as it is relevant
reads

exemptions and exclusions in determining
the total income-
 1  xx xx xx
 2  xx xx xx

in companyputing the total income of any
individual for the purpose of assessment
there shall be included-
 a  so much of the income of a wife or minumber
child of such individual as arises directly or
indirectly-

from the membership of the wife in a
firm of which her husband is a partner

from the admission of the minumber to the
benefits of partnership in a firm of which
such individual is a partner

from assets transferred directly or
indirectly to the wife by the husband
otherwise than for adequate companysideration or
in companynection with an agreement to live apart
or

from assets transferred directly or
indirectly to the minumber child number being a
married daughter by such individual
 otherwise than for adequate companysideration
 b  xx xx xx xx xx. sub-s.  3  of s. 16 of the act was introduced in 1937. for
the purpose of its application it is immaterial whether the
partnership was formed before or after 1937 and whether the
transfer was effected before or after that date. however
the sub-section deals only with income arising after its
introduction. it clearly aims at foiling an individuals
attempt to avoid or reduce the incidence of tax by
transfering his assets to his wife or minumber child or
admitting his wife as a partner or admitting his minumber child
to the benefits of partnership in a firm in which such
individual is a partner. it creates an artificial income
and must be strictly companystrued see bhogilal laherchand v.
commissioner of income-tax  1 . clauses  a   i  and  a

of the sub-section provide that in companyputing the total
income of an individual there should be included the income
arising directly or indirectly to his wife from her share as
a partner or to his minumber child from the admission to the
benefits of partnership in a firm of which such individual
is a partner. we are number directly companycerned with cls.  a  i
and  a   ii . we are companycerned with cl.  a  as sets
transferred by an individual to his wife has to be included
in the transferors total income. there are two exceptions
to this rule viz.  1  where the transfer is for adequate
consideration or  2  where it is in companynection with an
agreement to live apart. the second exception has no
bearing on the cases before us. the first and principal point which has been urged before us
on behalf of the appellant is this. it is pointed out that
at the time the transfer of shares was made by the as
asessee to mrs. judith knight the latter was number the wife of
the former and therefore cl.  a   iii  which talks of
assets transferred directly or indirectly to the wife by
the husband has numberapplication apart altogether from any
question of adequate companysideration. this argument on
 1  1954 25 i.t.r. 523.
behalf of the appellant was advanced before the high companyrt
also. the high companyrt sought to meet it in the following
way. mukharji j. who gave the leading judgment said that in
order to determine whether a particular case came under cl.  a   iii  or number the relevant point of time was the time of
computation of the total income of the individual for the
purpose of assessment and the section did number limit any
particular time as to when the transfer of assets should
take place. lie then observed
it appears to me that as the addition of the
wifes income to the husbands income under
this sub-section is made the relevant time of
the relationship between husband and wife
which has to be companysidered by the taxing
authorities is the time of companyputing of the
total income of the individual for the purpose
of assessment. that is how i read the opening
words of section 16  3  of the act in
computing the total income of any individual
for the purpose of assessment. bose j. expressed a slightly different view. he said that
the material companysideration under s. 16  3   a   iii  was
whether the transferee was actually the wife of the assessee
during the relevant accounting period when the income from
the assets transferred to her accrued. in effect both the
learned judges held that for the application of cl.  a

it was number necessary that the relationship of husband
and wife must subsist at the time when the transfer of the
assets is made according to mukharji j. the crucial date to
determine the relationship is the date when the taxing
authorities are companyputing the total income of the husband
and according to bose j. the crucial time is the time when
the income accrues to the wife. it must also be stated in
fairness to mukharji j. that he did number accept the view that
the words husband and wife in cl.  a   iii  included
prospective husband and prospective wife. he accepted the
view that the words husband and wife must mean legal
husband and legal wife. even so he expressed the view that
on a true companystruction of s. 16  3   a   iii  the time when
the relationship has to be companystrued is the time when the
computation of the total income of the husband is made. learned companynsel for the appellant has very strongly
contended before us that the view expressed by the learned
judges of the high companyrt as to the proper interpretation of
cl.  a   iii  is number companyrect. on a plain reading of sub-s.
 3  of s. 16 it seems clear to us that at the time when the
income accrues it must be the income of the wife of that
individual whose total income is to be companyputed for the
purpose of assessment this seems to follow clearly from
cl.  a  of sub-s.  3 . therefore in a sense it is right to
say that the relationship of husband and wife must subsist
at the time of the accrual of the income otherwise the
income will number be the income of the wife for the word
wife predicates a marital relationship. the matter does
number however end there. when we go to sub-cl.  iii  we find
that only so much of the income of the wife as arises
directly or indirectly from assets transferred directly or
indirectly to the wife by the husband shall be included in
the total income of the husband. therefore subcl.  iii
predicates a further companydition the companydition being that the
income must be from such assets as have been transferred
directly or indirectly to the wife by the husband. this
condition must be fulfilled before sub-cl.  iii  is
attracted to a case. it is clear that all income of the
wife from all her assets is number includible in the income of
the husband. thus on a proper reading of s. 16  3   a

it seems clear enumbergh that the relationship of husband
and wife must also subsist when the transfer of assets is
made in order to fulfil the companydition that the transfer is
directly or indirectly to the wife by the husband. learned companynsel for the respondent has companyended before us
that the transfer mentioned in s. 16 3   a   iii  need number
necessarily be post-nuptial and he has argued that the main
object of the provision s the principle of aggregation that
is the inclusion of the income of the wife in the income of
the husband because of the influence which the husband
exercises over the wife. he has also pointed out -hat sub-
cl.  i  which refers to the membership of the wife in a firm
of which her husband is a partner is indicative of the
object of the provision because it does number talk of any
assets being brought into the firm by the wife. he has
further argued that in sub-cl.  iii  the word wife is
merely descriptive and means the woman referred to in cl.  a  and the word husband has reference merely to the
individual whose total income is to be companyputed for the
purpose of assessment. in support of this argument he has
relied on the expression such individual occurring in sub-
s.  3   a . we are unable to accept these arguments as
correct. it is indeed true that all the four sub-clauses of
cl.  a  must be harmoniously read as this companyrt observed in
commissioner of income-tax v. sodra devi  1  but we see no
disharmony between sub-cl.  i  and sub-cl.  iii  on the
interpretation which we are putting. sub-cl.  i  talks only
of the membership of the wife in a firm of which her husband
is a partner it has numberreference to assets at all. sub-
cl.  iii  however talks of assests and qualifies the word
assets by the adjectival clause transferred directly or
indirectly to the wife by the husband. we fail to see how
any disharmony results from giving full effect to the
adjectival clause in sub-cl. iii . number do we see why
the words husband and wife should be taken in the
archaic sense companytended for by the learned companynsel for
the respondent. in re smalley smalley v. scotton  1  a
decision on which learned companynsel for the respondent relies
the facts were these. a testator by his will gave all his
property to my wife e.a.s. the testator left a
 1  1957 32 i.t.r.615623.  2  1929 2 ch. 112.
lawful wife m.a.s. and children by her and companytributed to
their support but about five years before his death had
contracted a bigamous marriage with a widow e. a. xi. who
lived with him and was knumbern as e.a.s. and believed she was
and was reputed to be his wife. the will was produced by

a.m. it was held that the will taken in companynection with
the surrouding circumstance indicated that the testator
intended to benefit e.a.m. she being in a secondary sense
and by repute his wife. the rules of companystruction which
were followed in that case were those laid down by lord
abinger in doe v. hiscoks lord abinger said
the object in all cases is to discover the
intention of the testator. the first and most
obvious mode of doing this is to read his will
as he has written it and companylect his
intention from his words. but as his words
refer to facts and circumstances respecting
his property and his family and others whom
he names or describes in his will it is
evident that the meaning and application of
his words cannumber be ascertained without
evidence of all those facts and circumstances. to understand the meaning of any writerwe
must first be appraised of the persons and
circumstances that are the subjects of his
allusions or statements x x x all the facts
and circumstances thereforerespecting
persions or property to which the will
relates are undoubtedly legitimate a
nd often
necessary evidence to enable us to understand
the meaning and application of his words. we are dealing here with a statute and the statute must be
construed in a manner which carries out the intention of the
legislature. the intention of the legislature must be
gathered from the words of the statute itself. if the words
are unambiguous or plain
 1   1839  5 m. w. 863 367.
they will indicate the intention with which the statute was
passed and the object to be obtained by it. there is
numberhing in sub-s.  3  of s. 16 which would indicate that the
word wife or the word husband must number be taken in their
primary sense which is clearly indicatve of a marital
relationship. number are we satisfied that the object of the
legislature is just the principle of aggregation. we have
said earlier that sub-s.  3  of s. 16 clearly aims at
foiling an individuals attempt to avoid or reduce the
incidence of tax by transferring his assets to the wife or
minumber child or admitting his wife as a partner or admitting
his minumber child to the benefits of partnership in a firm in
which such individual is a partner. this object does number
require that the word wife or the word husband should be
interpreted in an archaic or secondary sense. learned companynsel for the respondent has drawn our attention
to certain english decisions particularly the decision of
the house of lords in lord vesteys executors and vestey v.
commissioners of inland revenue  1 . one of the questions
which was companysidered in that decision was whether for the
purpose of either s. 18 of the finance act 1936  in
england  or s. 38 of the finance act 1938  in england
wife included a widow. their lordships had to companysider
the earlier decision of the companyrt of appeal in companymissioners
of inland revenue v.gaunt  2  which held that the one word
included the other. their lordships ultimately held over-
ruling the decision in gaunts case  1  that the word
wife did number include a widow. the english decisions
proceeded on the footing that in england it is a principle
of income tax law embodied in rule 16 of the general rules
that for income tax purposes husband and wife living
together are one. lord morton said
i think that the treatment of husband and
wife by the legislature for income tax
 1   1949  31 t. c. 1
 2   1941  24 t.c. 69.
purposes rests on the view that any income
enjoyed by one spouse is a benefit to the
other spouse. it is number surprising
therefore that in the sections number under
consideration a benefit to the wife
of the
settlor is treated a being a benefit to the
settlor but it seems to me unlikely that this
principle is being extended by these sections
to the widow of the settlor. number it is quite clear to us that the treatment of husband
and wife in the indian income-tax act 1922 does number rest on
the view that any income enjoyed by one spouse is a benefit
to the other spouse for sub-s.  3  of s. 16 makes it quite
clear that all income enjoyed by the wife is number to be
included in the income of the husband and only such of the
wifes income as companyes within the sub-section is to be
included in the income of the husband. we therefore think
that the english decisions are number in point and there are no
reasons why the word wife or the word husband should number
be given its true natural meaning. this brings us to the second question namely whether the
transfer of shares made by the assessee in favour of mrs.
judith knight on december 10 1947 was to take effect only
from the date of their marriage. it is admitted that on
december 10 1947 the assessee and mrs. knight were number
married. it is also admitted that they were engaged to be
married and the engagement was annumbernced on september 3
1947. the transfer deed which we have earlier quoted
contained numberwords of postponement. on the companytrary it
contained words which indicated that the transfer took
effect immediately. learned companynsel for the respondent has
rightly pointed out that the expression in the transfer deed
in companysideration of my forthcoming marriage can have very
little meaning as a real companysideration because on september
3 1947 the parties had mutually promised to marry each
other therefore the promise to marry
had been made earlier than december 10 1947. learned
counsel for the respondent has argued before us that the
transfer of shares was really a gift made to mrs. knight in
contemplation of the forthcoming marriage and the gift was
subject to a companydition subsequent namely that of marriage
which if number performed would put an end to the gift. this
does number however advance the case of the respondent in any
way. a gift may be made subject to companyditions either
precedent or subsequent. a companydition precedent is one to be
performed before the gift takes effect a companydition
subsequent is one to be performed after the gift had taken
effect and if the companydition is unfulfilled that will put an
end to the gift. but if the gift had already taken effect
on december 10 1947 and the companydition subsequent has been
later fulfilled then the gift is effective as from december
10 1947 when the assessee and mrs. knight were number husband
and wife. that being the position sub-cl.  iii  of s. 16
 3   a  will number be attracted to the case as the transfer of
the shares was number made by the husband to his wife. we were also addressed on the question as to the
circumstances in which a gift to an intended wife or husband
may be recovered when the marriage does number take place
through the fault of either of the two parties. we do number
think that that question falls for decision in the present
case. from whatever point of view we look at the transfer
of shares in the present case whether it be in
consideration of a promise to marry or be a gift subject to
the subsequent companydition of marriage the transfer takes
effect immediately and is number postponed to the date of
marriage.


1997 supp 5  scr 616

the judgment of the companyrt was delivered by

mrs. sujata v. manohar j. the appellant and the respondents companytested the
vidhan sabha election held in march 1995 from the 190 lakhisarai
constituency in the state of bihar. respondent number i was declared as the
returned candidate. the appellant challenged the election of respondent
number1 before the patna high companyrt by filing an election petition. in this
petition he challenged the election under section 100 l  d  iii  of the
representation of the people act 1951 alleging that the result of the
election had been materially affected by the improper reception of votes
and by mixing the votes of the appellant with the votes of other companytesting
candidates. respondent number 1 filed a petition before the high companyrt under order 7 rule
l l of the civil procedure companye read with order 6 rule 16 of the civil
procedure companye raising a preliminary objection about the maintainability of
the election petition. the high companyrt by its impugned judgment and order
dated 13.1.1997 rejected the election petition of the appellant under
section 83 l  a  of the representation of people act read with order 7 rule
11 on the ground that the petition did number disclose a companyplete cause of
action and was therefore number maintainable. the relevant provisions of section 83 1  of the representation of the
people act 1951 are as follows

83 companytents of petition - 1  an election petition-

 a  shall companytain a companycise statement of the material facts on which
the petitioner relies

 b  shall set forth full particulars of any companyrupt practice that the
petitioner alleges including as full a statement as possible of the names
of the parties alleged to have companymitted such companyrupt practice and the date
and place of the companymission of each such practice and

 c

the election petition of the appellant does number allege any companyrupt
practice. therefore in the present case the question of application of
section 83 1   b  dose number arise. the only relevant provision therefore
is section 83 1   a  which requires the petition to companytain a companycise
statement of material facts on which the petitioner relies. the language of
section 83 ixa  is similar to the language of order vi rule 2 1  which
provides that every pleading shall companytain and companytain only a statement
in a companycise form of material facts on which the party pleading relies for
his claim or defence as the case may be but number the evidence by which
they are to be proved. by companytrast under section 83 1   b  number only is it
necessary to set out full  as opposed to companycise  particulars but also a
full statement of the names of parties who have allegedly companymitted a
corrupt practice and the date and place of its companymission. we have therefore to see whether the election petition companytains a companycise
statement of material facts i.e. cause of action. the election petition of
the appellant from paragraph 10 onwards deals with the companynting of ballot
papers and why according to the appellant such companynting was unfair
improper or number in accordance with law. he had alleged that the returning
officer did number companyply with rule 56 of the companyduct of election rules. 1961
and the instructions companytained in the hand-book for returning officers. he
has given particulars of some of the irregularities. in paragraph 15 for
example he has alleged that on companynting table number. 11 and 12 ballot
papers marked on hand symbol were mixed with those of other party
candidates and in the process ballot papers which were marked on hand
were number being companynted in favour of the appellant. the appellant has stated
that his companynting agents specifically stated to him when he visited the
counting hall that hundreds of such ballot papers had already been mixed
with the ballot papers in favour of an independent candidate respondent
number 9. he has alleged that 3530 votes which should have been companynted in
his favour were wrongly companynted in favour of respondent number 9. he has also
referred to the companytemporaneous written companyplaints lodged by him in this
connection. in paragraph 16 detailed tables are given showing the wrong
counting of votes cast in favour of the appellant which were companynted as the
votes of respondent number 9. the numbers of such votes so companynted on each
counting table have been separately set out in a tabular form in detail. the appellant has also sought leave to refer to and rely upon the various
fax messages and companyplaints to the returning officer as well as to the
general observer made in this behalf by him. amongst the other objections
he has alleged that at the stage of the fourth round of companynting onwards
ballot papers of two different companyours were seen. despite the appellant
complaining to the returning officer about the different companyours of ballot
papers on the companynting tables numberproper attention was paid to his
complaint. he has also set out that his companynting agents were number given a
reasonable opportunity of inspecting ballot papers before they were
rejected. there are various other particulars set out in the election
petition in support of the appellants companytention regarding irregularities
and illegality in the companynting of votes. whatever be the merit of such
contentions one thing at least is clear. the election petition cannumber be
rejected at a preliminary stage on the ground that it does number companytain
concise statement of material facts. the high companyrt has held that the allegations regarding irregularities in
the companynting of ballot papers are number supported by adequate material or by
material particulars. the high companyrt has further held that some imaginary
figures are given in respect of alleged irregularities. the appellant has
in his verification affidavit stated that the statement are based on
information derived from his companynting agents and election agents. the high
court holds that because the names of these persons are number disclosed. the
allegations must be companysidered as vague. the high companyrt has further said
that the basis on which the companynting agents or election agents of the
appellant had furnished information regarding rejection of 2600 ballot
papers on the ground that the same did number bear the distinguishing mark or
the signature of the presiding officer has also number been furnished. however evidence in support of the pleas which have been taken or facts
which have been pleaded cannumber be companyfused with the companycise statement of
material facts which an election petition is required to set out under
section 83 l  a . in the case of shri udhav singh v. madhav rao seindia
1977 1 scc 511 this companyrt made a distinction between material facts and
material particulars. the companyrt said that this distinction was important
because different companysequences may flow from a deficiency of such facts of
particulars in the pleading. failure to plead even a single material fact
would lead to an incomplete cause of action and incomplete allegations of
such a charge are liable to be struck off but if material particulars are
lacking they may be supplied at a later date. respondent number 1 relies upon
this distinction in support of his plea that the election petition is
liable to be dismissed for number-disclosure of material facts. the election
petition however is required to companytain a companycise statement of material
facts this being equivalent to a cause of action. the entire evidence in
support of such material facts is number required to be set out. from the
contents of the election petition it is number possible to hold that a
concise statement of material facts is number to be found in the petition. in
the case of arun kumar bose v. mond. furkan ansari ors. air 1983 vsc
1311 at page  1314  this companyrt distinguished the provision of section 83 1
 a  from 83 l  b . the scheme in section 83 1  of the act makes the
position clear. clause  a  refers to general allegations and requires a
concise statement of material facts to be furnished while clause  b
referring to companyrupt practice requires all details to be given in that
case the number of wrongly rejected ballot papers and the companynting table
number were given. both numbers were also given. particulars of ballot
papers however were number given as number available. it was held that
pleadings set out material facts as per section 83 l  a . numbercorrupt
practice was involved and section 83 1  b  was number attracted. pleading was
held to be adequate. two other judgments which have been cited before us
deal with the power to the high companyrt to order a recount. these are
jitendra bahadur shigh v. krishna bihari ors. 1970 1 scr 852 and
satyanarain dudhani v. uday kumar singh ors. 1993 supp. 2 scc 821. in
the latter case it was pleaded in the election petition that 339 valid
ballot papers in favour of the petitioner were number taken into account. thirty five valid votes were number companynted in favour of the petitioner on the
plea that the ballot papers were missing. irregularities were also pleaded
materially affecting the result of the election. this companyrt in this
context dealt with the question whether the high companyrt should have ordered
a recount. it has companye to the companyclusion that before the returning officer
only a three-line application was filed. numberobjection whatsoever was raised
during the companyntin0067 and numberirregularity or illegality was brought to the
numberice of the returning officer. the companyrt also felt that the material in
the election petition was pleaded with the object of having a finishing
enquiry did number inspire companyfidence. it therefore did number order a recount. these two cases do number help the first respondent because neither of these
cases deals with the dismissal of the election petition in limine on the
ground of number-compliance with the provisions of section 83 l  a .