No Acts & Articles mentioned in this case
A F R
Reserved on 02.04.2019
Delivered on 17.10.2019
Court No. - 34
Case :- SPECIAL APPEAL No. - 1481 of 2007
Appellant :- M/S Universal Insulator And Ceramics Ltd
Respondent :- Official Liquidator High Court, Allahabad
Counsel for Appellant :- Amit Saxena, Navin Sinha (Senior Advocate)
Counsel for Respondent :- Anurag Khanna, A.K. Mishra, Arvind
Srivastava, M. Ali, Om Prakash Misra, P. K. Singhal, R. K. Gupta,
Rajnath N. Shukla, Satish Chaturvedi, Usha Kiran
Hon'ble Sudhir Agarwal,J.
Hon'ble Rajendra Kumar-IV,J.
(Delivered by Hon'ble Sudhir Agarwal, J)
1.This intra Court appeal has been filed under Section 483 of
Companies Act, 1956 (hereinafter referred to as “Act, 1956”) read with
Chapter VIII, Rule 5 of Allahabad High Court Rules, 1952 (hereinafter
referred to as "Rules, 1952") assailing judgment dated 19.09.2007 passed
by a learned Single Judge, (Hon'ble Sunil Ambwani, J, as His Lordship
then was) in Misc. Company Application No.3 of 1999 in Re. M/S
Universal Insulator and Ceramics Ltd (hereinafter referred to as
“Defaulting Company/Appellant”) rejecting objection with regard to
jurisdiction of entertaining winding up petition at Allahabad and holding
that Defaulting Company/Appellant is unable to pay its debts, hence it is
just and equitable to wind up the same and consequently directing for
winding up of Company and appointing Official Liquidator as Liquidator
of Company. The jurisdictional issue raised is that winding up petition
was within the jurisdiction of Judges sitting at Lucknow and not at
Allahabad, therefore, there is an inherent lack of jurisdiction in respect of
subject matter of winding up, hence, order of winding up is illegal and
void, but this objection has been rejected by learned Single Judge.
Learned Single Judge has also restrained Defaulting Company/Appellant
from transferring, alienating and encumbering any assets of Company
and Official Liquidator has been directed to take over possession of
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assets of Company.
2.Facts in brief giving rise to present appeal are, that, Defaulting
Company/Appellant, a Public Limited Company, was incorporated in
October 1978 under the provisions of Act, 1956. Certificate of registration
was issued by Registrar of Companies, Kanpur. Its Registered Office is at
A/2, Site No.2, Industrial Area, Rai Bareilly. Company could not run its
business effectively and became sick. It made a Reference to Board for
Industrial and Financial Reconstruction (hereinafter referred to as
“BIFR”) for declaration as a “Sick Industry” under Section 15 (1) of Sick
Industrial Companies (Special Provisions) Act, 1985 (hereinafter referred
to as “Act, 1985”). BIFR registered Reference as Case no.243 of 1987.
BIFR appointed Industrial Investment Bank of India Limited (hereinafter
referred to as “IIBI”), (now IFCI Limited and is suitably substituted as
respondent 4, initially impleaded as “IIBI”) as Operating Agency
(hereinafter referred to as “O.A.”). O.A. submitted report and BIFR
sanctioned the same on 25.10.1990. It was modified on 15.03.1993.
Rehabilitation Scheme could not operate. Notice was issued to Defaulting
Company/Appellant for winding up by BIFR and objections were heard
on 12.03.1998. O.A. informed BIFR on 05.11.1998 and 08.12.1998 that
Defaulting Company/Appellant had failed to comply with directions of
BIFR and even personal loan of Rs.1 lakh was not paid.
3.Ultimately, BIFR formed an opinion that Company was not likely to
make its net worth exceed its accumulated losses within reasonable time
and it is also not likely to become viable in future and to meet its financial
obligations, hence it was just, equitable and in public interest that it should
be wound up under Section 20 (1) of Act, 1985. BIFR's opinion was
forwarded to this Court (Company Judge) at Allahabad by Registrar of
BIFR vide letter dated 23.04.1999, which was received by Court on
03.05.1999.
4.Defaulting Company/Appellant represented through counsel,made a
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statement before Company Judge on 14.10.1999 that it shall pay entire
debts and desired to revive itself. Company Judge, on 07.08.2000, after
considering objections filed by respective parties, sanctioned schedule of
repayment (One Time Settlement). Thereafter on various dates matter
came up before Company Judge. Parties made correspondence, held
meetings, got various orders of this Court from time to time but nothing
concrete could come.
5.In the meantime Pradeshik Investment Corporation of Uttar Pradesh
(hereinafter referred to as “PICUP”) initiated coercive steps against
Defaulting Company/Appellant by invoking personal guarantee of
Promoter and Chairman/Managing Director in the light of decision taken
in the meeting of PICUP on 14.05.2002.
6.Another Financial Institution i.e. Syndicate Bank, respondent 5,
initiated recovery proceedings before Debt Recovery Tribunal (hereinafter
referred to as “DRT”) in T.A.No.165 of 2002 and 261 of 2002.
7.Respondent 4 i.e. IIBI also initiated recovery proceedings, filed
Original Application No.05 of 2003 in DRT, Lucknow for recovery of
Rs.58469876/-.
8.Learned Company Judge, in modification of earlier order dated
07.08.2000, whereby schedule of repayment was sanctioned, passed order
dated 15.10.2003, but nothing could proceed further since factory
premises was attached by District Magistrate, Rae Bareilly for effecting
recovery of tax dues under recovery certificate issued by Trade Tax
Authorities against Defaulting Company/Appellant.
9.Company Judge on an application of Defaulting
Company/Appellant, passed an order on 11.11.2003 and clarified its order
dated 15.10.2003 whereupon Company approached State Government
who decided to withdraw Recovery Certificate issued by Tax Authorities.
Consequently, District Magistrate revoked attachment of factory premises
on 21.01.2004.
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10.Defaulting Company/Appellant giving an impression that it wants
to comply Company Judge's order dated 15.10.2003, requested IIBI and
Syndicate Bank as also Uttar Pradesh State Industrial Development
Corporation Limited (hereinafter referred to as “UPSIDC”) to withdraw
their Recovery Certificates/Court Cases. Syndicate Bank vide letter dated
14.01.2006 required Defaulting Company/Appellant to make fixed deposit
of Rs.5 lacs in a no lien Escrow account to enable bank to settle One Time
Settlement and file compromise petition with DRT.
11.While all these were pending, a Miscellaneous Application dated
17.02.2007 was filed by Defaulting Company/Appellant before Company
Judge stating that Registered Office of Company is at A/2, Site No.2,
Industrial Area, Rai Bareilly, which falls within jurisdiction of Lucknow
Bench of this Court, hence winding up matter was cognizable at Lucknow,
in view of Section 10 of Act, 1956; it was wrongly referred by BIFR to
this Court at Allahabad, hence Company Application No.3 of 1999 be
transferred to Lucknow. Appellant placed reliance on a Division Bench
Judgment in Registrar of Companies, U.P. and Uttranchal, Kanpur Vs.
M/s Kamal Infosys Ltd. And others, Company Petition No.57 of 2001,
2005 (59) ALR 492. This application was opposed by Financial
Institutions and in particular, by Syndicate Bank.
12.Vide judgment under this appeal, Company Judge has rejected
aforesaid application and directed for winding up of Company with
further direction to Official Liquidator to take possession of assets of
Company and proceed further.
13.Principally, judgment of Company Judge has been assailed on the
ground of lack of jurisdiction, but simultaneously, though with hesitation,
it has been argued on behalf of Defaulting Company/Appellant that there
was no justification for learned Company Judge to pass order of winding
up. Instead, opportunity should have been given to Defaulting
Company/Appellant to clear outstanding dues.
Special Appeal No.1481 of 2007
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14.Appeal has been contested by respondents. As we have already said
that respondent 4, IIBI had granted financial assistance to Defaulting
Company/Appellant and its dues are secured as charge has been created
along with other Secured Creditors on movable and immovable properties
of Company. Civil Misc. Application No.252663 of 2011 was filed stating
that IIBI had transferred and assigned its debt to M/s IFCI Ltd, which is
also a Public Company registered under Act, 1956 and also a “Public
Financial Institution”, as defined under Section 4-A of Act, 1956. Under
Assignment Deed dated 28.04.2011, IIBI assigned and transferred the
deeds and documents guaranteed together with all underlying securities,
interest thereto and all its rights, title and interest in all agreements, deeds,
documents and benefits etc. to M/s IFCI Ltd. Therefore, vide order dated
02.04.2012 substitution was allowed and M/s IIBI stood substituted by
M/s IFCI Ltd. i.e. respondent 4.
15.Respondent 2 i.e. PICUP has filed a short counter affidavit stating
that Defaulting Company/Appellant has been lingering proceedings not
only before BIFR, but even before this Court for more than one and half
decade. PICUP and other respondents accepted OTS-cum-Rehabilitation
Scheme in pursuance whereof Defaulting Company/Appellant was to pay
Rs.82,15,000/- to PICUP, but it could pay only Rs.10,31,257/- and
Rs.71,83,673/- remained unpaid, which became Rs.1,41,73,000/- with
interest as on 31
st
October, 2007. This shows that Defaulting
Company/Appellant committed default despite Creditors having agreed
for OTS-cum-Rehabilitation Scheme. Defaulting Company/Appellant
could not discharge its own part of duty towards payment. Defaulting
Company/Appellant has filed application with malafide intention in 2007
agitating the issue of territorial jurisdiction for the first time though it has
availed benefit of various orders passed by this Court at Allahabad and,
therefore, at this stage, it cannot be allowed to raise such an issue which
lacks bonafide.
16.Respondent 5 i.e. M/s Syndicate Bank, Aminabad, Lucknow had
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also filed a counter affidavit pointing out that despite repeated indulgence
granted by BIFR, making all efforts for rehabilitation, Defaulting
Company/Appellant failed to take appropriate steps for its own
rehabilitation and this has been noticed by BIFR in its order dated
13.04.1999 wherein it has said as under :
“A revival scheme earlier sanctioned by the Board had
failed to rehabilitate the company. The inability expressed by
the company/promoters to even insure the assets and make
payment of the premium, clearly showed that promoters
were not resourceful to bring in the funds of the required
order.”
17.Consequently, BIFR had no option but to record its view that
Defaulting Company/Appellant is not likely to make its worth exceed its
cumulative losses within reasonable time by meeting all its financial
obligations. Defaulting Company/Appellant, as a result thereof, was not
likely to become viable in future and it is just, equitable and in public
interest, that it is wound up under Section 20 (1) of Act, 1956.
Consequently, BIFR forwarded the matter to this Court for necessary
action according to law. Defaulting Company/Appellant preferred Appeal
No.243 of 1999 before Appellate Authority for Industrial and Financial
Reconstruction, New Delhi (hereinafter referred to as “AAIFR”) but the
same was also dismissed vide order dated 21.06.1999 passed by AAIFR
observing that mere intention for rehabilitation on the part of Promoter is
not sufficient and they have clearly failed to make any efforts to raise
funds. It shows no possibility of rehabilitation of Defaulting
Company/Appellant. Bank filed a suit for recovery before DRT only when
Defaulting Company/Appellant failed to comply this Court's order dated
07.08.2000. Various applications were moved only as a pretext so as not to
comply order dated 07.08.2000 by Defaulting Company/Appellant. All the
proceedings initiated by Defaulting Company/Appellant were lacking
bonafide on its part. This Court (Company Judge) modified order dated
07.08.2000 by order dated 15.10.2003, but even then it was not complied
Special Appeal No.1481 of 2007
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with though Bank's suit i.e. T.A. no.261 of 2002 before DRT was
disposed of in terms of this Court's order dated 15.10.2003, vide order
dated 28.07.2005. Defaulting Company/Appellant having no intention to
comply orders, in a mischievous way, filed Writ Petition No.2895 of 2006
(M/S) before Lucknow Bench in which an interim order was passed by
learned Single Judge (Hon'ble Rakesh Sharma, J) on 12.06.2006 staying
order of DRT passed in Case No.TA 261 of 2002 and also restraining all
opposite parties therein from taking any coercive action against
Defaulting Company/Appellant during pendency of that writ petition.
Further, on an application moved by Bank for recall of order dated
15.10.2003, this Court (Hon'ble S. U. Khan, J) passed order on 05.04.2007
recalling order dated 15.10.2003, making a clear observation that perusal
of different orders starting from 07.08.2000 to 09.02.2007 show that
Defaulting Company/Appellant has got absolutely no intention of paying
any amount. Application of Defaulting Company/Appellant of raising
issue of jurisdiction lacks bonafide and even otherwise after eight years,
there was no justification to permit Defaulting Company/Appellant to
raise issue of territorial jurisdiction, which it has never raised for last more
than eight years and infact submitted to the jurisdiction of this Court at
Allahabad.
18.We have heard Sri Navin Sinha, Senior Advocate assisted by Sri
Amit Saxena, learned counsel for appellant, Sri Rajnath N. Shukla,
learned counsel for respondent-1 and Sri Arvind Srivastava, learned
counsel for respondent 3.
19.Sri Navin Sinha, Senior Advocate appearing for Defaulting
Company/Appellant stated that jurisdiction cannot be conferred even by
consent of parties. He contended that, when new High Court was
constituted by amalgamation of High Court at Allahabad and Chief Court
of Oudh, vide Article/Clause (3) of United Provinces High Courts
(Amalgamation) Order, 1948 (hereinafter referred to as “U. P. High Courts
(Amalgamation) Order, 1948”), jurisdiction in respect of cases arising in
Special Appeal No.1481 of 2007
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such areas in Oudh/Avadh, as Chief Justice may direct, was allowed to be
exercised by Judges sitting at Lucknow. Admittedly, jurisdiction of cases
arising in District-Rae Bareilly is within jurisdiction of Judges sitting at
Lucknow, therefore, Reference of winding up of Defaulting
Company/Appellant was within jurisdiction of this Court sitting at
Lucknow and not at Allahabad. Learned Senior Counsel contended that a
perusal of U. P. High Courts (Amalgamation) Order, 1948 shows that
there existed two High Courts, one at Allahabad and another at Lucknow
and both were amalgamated in a New High Court known as “High Court
of Judicature at Allahabad”. In respect of such areas as determined by
Chief Justice, jurisdiction was conferred to Judges sitting at Lucknow and
rest were left to the jurisdiction of Judges sitting at Allahabad. U.P. High
Courts (Amalgamation) Order, 1948, did not recognize any “Principal
Seat” of High Court at either place and it was in the context of mere
sitting of Judges whether at Lucknow or at Allahabad, which was relevant
for deciding the cases. To assume that the High Court of Judicature at
Allahabad has its “Principal Seat” at Allahabad and, therefore, in all
residuary matters or even otherwise if the Judges sitting at Allahabad have
taken cognizance that would be valid, is not correct, particularly when
territorial jurisdiction in the matter of High Court is governed by
constitutional provisions and if there is any lack of territorial jurisdiction
the order would be void. Placing reliance on Supreme Court's judgment in
Sri Nasiruddin vs. State Transport Appellate Tribunal, 1975(2) SCC
671, Manju Verma (Dr.) Vs State of U. P. and others, 2005 (1) SCC 73,
and Division Bench judgment of this Court in Registrar of Companies,
U. P. and Uttranchal, Kanpur vs. M/s Kamal Infosys Ltd. And others
(supra) and Sumac International Services Limited vs. P.N.B. Capital
Services Limited, AIR 1997 (Allahabad) 424, he submitted that learned
Company Judge has erred in law in rejecting application submitted by
Defaulting Company/Appellant raising objection in regard of jurisdiction,
therefore, judgment of learned Single Judge is erroneous, illegal and
Special Appeal No.1481 of 2007
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without jurisdiction, hence, liable to be set aside. He further contended
that even on merits, learned Single Judge has mechanically followed
opinion of BIFR instead of applying its own mind, therefore, order of
winding up is illegal and liable to be set aside. In support thereof, reliance
is placed on Supreme Court's judgment in V. R. Ramaraju Vs. Union of
India and others, 1997 (3) C.L.J. 221 (SC) and a Single Judge Judgment
of this Court in Cawnpore Chemical Works (P.) Limited Vs. Appellate
Authority of Industrial and Financial Reconstruction and others,
2002 (3) AWC 2012.
20.Learned counsel for respondents, on the contrary, submitted that
jurisdiction of Company matters was/is within jurisdiction of this Court at
Allahabad, hence, Reference has rightly been entertained hereat. It is
contended on behalf of respondents that in Sri Nasirrudin (supra), Court
considered the question of “Permanent Seat” of High Court of Judicature
at Allahabad and not the question of “Principal Seat”. This aspect has been
looked into in subsequent judgments i.e. in S. P. Sampath Kumar and
others vs. Union of India and others, 1987 (1) SCC 124 and L.
Chandra Kumar vs. Union of India and others, 1997 (3) SCC 261 and
has to be looked into from that angle. The “administrative seat” of High
Court of Judicature at Allahabad is at Allahabad. The cases, where the
Hon'ble Chief Justice passes an order falling within territorial jurisdiction
of Lucknow have to be heard at Allahabad or transferred to Allahabad but
not vice versa. The provisions of High Court Rules etc. all show that there
may not be any “Permanent Seat” of this Court at Lucknow or Allahabad
but “Principal Seat” of High Court is at Allahabad and if a matter has been
registered at Allahabad, in absence of any objection raised by concerned
party with respect to territorial jurisdiction, the matter, if has proceeded
for several years and many orders have been obtained by a party in its
favour, subsequently it cannot raise issue of territorial jurisdiction. It is
contended that in any case, the Judges sitting at Lucknow are only
required to look into winding up and once winding up order is passed,
Special Appeal No.1481 of 2007
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thereafter matter has to be transferred to Allahabad for further
proceedings. It shows that in the matter of winding up, main operations
are to be conducted at Allahabad. Hence, here issue of territorial
jurisdiction is only technical. For all practical purposes, jurisdiction is
with Judges sitting at Allahabad. In any case, it is urged that it is not a
case of inherent lack of jurisdiction in the matter of winding up. Thus, also
the objection raised by appellant deserves to be rejected. It is lastly
contended that objection of jurisdiction ought to have been taken at the
earliest and not after availing several orders in favour of appellant and at a
much later stage. With regard to such belated objection reliance is placed
on Supreme Court's judgments in R.S.D.V. Finance Company Private
Limited vs. Shree Vallabh Glass Works Limited, 1993 (2) SCC 130;
Om Prakash Agarwal (since deceased) through legal heirs and others
Vs. Vishan Dayal Rajpoot and another, 2019 (Allahbad Civil Journal)
3 (SC) and Competition Commission of India vs. Bharti Airtel Limited
and others, 2019 (2) SCC 521.
21.We have considered rival submissions of parties, perused record and
also relevant authorities and statutory provisions, very carefully, and
looked into entire matter in depth.
22.In support of submissions with respect to jurisdiction learned Senior
Counsel has placed reliance on Supreme Court's judgment in Sri
Nasirruddin (supra) at length and also historical backdrop of Courts at
Lucknow and Allahabad, which ultimately resulted in amalgamation and
functioning of High Court at Lucknow and Allahabad.
23.Submissions advanced by learned Senior Counsel of respective
parties, in our view give rise to following issues :-
(I) Whether “Permanent Seat” and “Principal Seat” is one and the
same thing and can it be said that there is no “Permanent Seat” as
well as “Principal Seat” of this High Court at Allahabad and
Lucknow?
Special Appeal No.1481 of 2007
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(II) Whether issue of 'jurisdiction' in the matter of winding up of
a company goes to the root of the matter, inasmuch as, Judges
sitting at Allahabad on the subject of winding up of a company
have no jurisdiction at all or considering peculiar facts and
circumstances in the matter, dealing with winding up of company
matters, can it be said that jurisdiction to Judges sitting at
Allahabad is not completely barred?
(III) Whether in the facts of this case, where Reference made by
BIFR on 23.04.1999 was received by this Court at Allahabad on
03.05.1999 and thereafter first order was passed by Company
Judge at Allahabad on the statement made by appellant's counsel
on 14.10.1999 and subsequent proceedings held for almost eight
years without any objection to territorial jurisdiction, would
prevent appellant from raising the issue of lack of jurisdiction
after almost eight years or objection being inherent and going to
the root of the matter, has to be upheld irrespective of conduct of
appellant and whether entire proceedings which had gone for the
last eight years, are without jurisdiction?
(IV) If the objection regarding jurisdiction and the above
questions are answered against appellant, whether on merits also
winding up order passed by Company Judge, is justified?
24.Now we proceed first to decide the first question which is of utmost
importance, not only for the purpose of present case, but even otherwise.
25.The dispute in relation to territorial jurisdiction, i.e. cases
admissible with reference to territory of this Court at Allahabad and
Lucknow, is a perennial cause of discontentment and continuous cause of
litigation. It has also involved rivalry of Advocates at these two places,
since it directly affects quantum of work at two places. Therefore, it has
attracted attention of this Court as well as Supreme Court, time and again.
We can take judicial notice of the fact that territorial jurisdiction or
Special Appeal No.1481 of 2007
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division of cases on the basis of territory has become a serious point of
confrontation amongst Advocates practising at Lucknow as well as
Allahabad and many a times even Court's work has been paralysed due to
abstention of Advocates from work for raising and pressing their demand
in respect of certain cases, arising from particular area, whether
admissible at Lucknow or Allahabad. In our view, it is high time when this
aspect needs be considered threadbare so as to settle dispute for all times
to come, to mitigate rivalry among two sections of officers of this Court
practising at these two places and also in the interest of litigants at large.
26.For history, development and growth of Courts, including High
Court, it is not necessary to go into Moghal system of dispensation of
justice, instead it will be appropriate to have a brief re-look from the stage
of growth of power of Britishers, firstly with East India Company and
thereafter, British Government. In fact at the time of independence we had
the system of administration of justice as developed by Britishers and we
have maintained that inheritance with some changes as found necessary in
the light of the provisions of Constitution of India which came into force
on 26
th
January 1950. For having a retrospect of historical development of
judicial system initiated and developed by Britishers, fortunately we have
information in the form of publication of certain official momentos by this
Court in recently concluded “Sesquicentennial functions” on completion
of 150 years of establishment of this Court. Enough historical details have
been given in various documents published by this Court and having
benefit of same, what transpires therefrom, in brief, may be noticed
hereinafter.
27.Arrival of Britishers in India begins with the issue of Charter of
1600 by Queen Elizabeth in England, pursuant whereupon, some
merchants of London formed “East India Company” to trade with East
Indies. As a consequence of this Charter “British East India Company” set
up trading establishment on the East and West Coasts of India and in
Bengal. Charter of 1600 was mainly designed for trade in order to meet
Special Appeal No.1481 of 2007
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competition with Portuguese and Dutch. This Charter contained all
provisions necessary for constitution of a Government according to law in
any territory. This Charter granted permits to traffic and use trade of
merchandise and to assemble themselves in any convenient place to make
reasonable laws and ordinances for the good governance of “East India
Company”. The Factories, on the other hand, were not given power to
make laws and impose punishments.
28.Charter of 1661 gave East India Company power to coin money to
administer justice and to punish the Interlopers. It also empowered 'East
India Company' to appoint Governor's Council, and, appoint other officers
for their help. Governor and Councils were authorized to administer
justice in all the causes, civil as well as criminal, according to the laws of
Kingdom and execute judgments accordingly. Charter of 1661 gave 'East
India Company' power to make peace or war with non Christians, erect
Fortifications and cease Interlopers.
29.Next is Charter of 1669 which for the first time gave territorial
sovereignty to 'East India Company' by granting it, Port of Bombay. It also
enlarged its administrative, judicial and governmental powers with civil
and military government.
30.Charter of 1677 empowered 'East India Company' to establish a
mint at Bombay for coining money i.e. Indian Rupees. Charter of 1683
gave Company full powers with respect to declaring wars and making
peace with “heathen nation” (the nation where people do not follow
Christianity) and King established a Court of Justice with maritime
jurisdiction. Courts were empowered to adjudge and determine cases
according to rules of equity and good conscience and laws and customs of
merchants.
31.By Charter of 1687 'East India Company' established a Mayor's
Court at Madras. It consisted of twelve Aldermen and sixty or more
Burgess. After settlement of Calcutta founded by Job Charnoc in 1690
Special Appeal No.1481 of 2007
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there was gradual increase of British population in India. A necessity was
felt for having Courts which may dispense justice to Britishers in
accordance with English law. There was diverse legal frameworks
working in British settlements. Charter of 1726, therefore, came to be
issued providing for establishment of 'Corporation' in each presidency
town. It also established 'Mayor Court' at all three presidencies i.e.
Madras, Calcutta and Bombay. These Courts were having jurisdiction in
civil matters including 'Testamentary' and 'Probate Wills' but criminal
matters were left to be decided by and within the jurisdiction of Governor-
in-Council which acted as Court in such matters. It also made a provision
for Second Appeal to King and Council. Under this Charter, First Appeal
could be filed before Governor and Council, and Second Appeal could be
taken to King and Council in England. These Courts administered English
law which was assumed to be 'lex loci' of the settlement. Inhabitants of
settlement resorted to English law. They were governed by English law,
irrespective of their nationality. Mayor's Courts were declared to be
“courts of record” and authorized to hear and determine all civil actions
and may plead between parties and party. Outside the settlement, local
inhabitants i.e. Indians were supposed to be living in their own country
and subject to their own laws, the task of administering justice which had
been taken upon, since disintegration of Moghal sovereignty, by their
erstwhile Deputies and Governors.
32.In 1765, Robert Clive secured in perpetuity, for 'East India
Company', Dewani of Bengal, Bihar and Orissa from Moghal Emperor
Shah Alam against payment of Rs.26 lacs. By this grant, Company
claimed to have become virtual 'Sovereign' and master of this territory.
Consequently, a proposal was made by Warren Hastings and his Council
on 15.08.1772, which was adopted by British Government on 21.08.1772,
and Mofussil Dewanny Adawluts, or Provincial Courts of civil justice,
under superintendence of Collectors of Revenue were established in each
district. Under Regulations passed on 21.08.1772, Criminal Courts,
Special Appeal No.1481 of 2007
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designated as 'Faujdari Adalats' were established and placed under
superintendence of Collectors of Revenue.
33.British Parliament passed Regulating Act in 1773 giving power
upon Her Majesty to constitute Supreme Court in Bengal for British
subjects and employees of Company. However, Charter of 1774 pursuant
to Regulating Act, 1773 though established Supreme Court in Bengal but
did not mention limitations. This omission caused a lot of conflict in
opinion about jurisdiction of Supreme Court. For Indians living outside
Calcutta, administration of justice was different.
34.In 1774, a minor alteration was made and Collectors were
withdrawn by appointing Provincial Councils in six Divisions in respect
of the set up of above Courts.
35.On 18.10.1775, superintendence of Criminal Courts was entrusted
to Naib Nazim, who appointed Foujdars to preside over the said Courts.
On 28.03.1780 it was decided to establish District Courts in six Divisions,
which were made independent of Provincial Councils. In 1781, alleging
that Foujdars have not satisfied the intended purpose, a change was
brought in. Criminal Courts were continued in several Divisions subject to
superintendence of Naib Nazim but English Judges of Dewani Adalats
were appointed as Magistrates with power to take cognizance of offences,
apprehend their perpetrators and commit them to nearest Criminal Court
for trial. Interestingly, these English Magistrates had no effective role over
Zamindars and Landholders. On 27.06.1787, Magistrates were vested with
authority to decide, upon complaints, petty offences such as petty affrays,
abusive names etc.
36.On 03.12.1790, Regulations were passed whereby 'Courts of
Circuit' under superintendence of English Judges, assisted by persons well
versed in Mohammedan Law, were established for trying, in the first
instance, cases of crimes and misdemeanours. Regulations with regard to
Criminal Courts were consolidated and re-enacted in Regulation IX of
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1793.
Revenue Adminstration
37. Revenue Administration owed its origin to the grant of Dewani
whereby 'East India Company' had become responsible for collection of
Revenue in view of grant, it held, from the then Moghal Emperor. Prior to
1771, task of settlement and collection of Revenue was carried by
covenanted servants of East India Company in Calcutta, Twenty-four
Parganas, Burdwan, Midnapore and Chittagong. In other parts, Dewans at
Murshidabad and Patna were responsible for collecting revenue. In 1771
Directors of 'East India Company' declared their resolution regarding
management and care of revenue through the agency of Company's
servants. To resolve disputes regarding revenue arising between East India
Company and Landholders, and, also Landholders and their tenants or
'Ryots', the 'Mal Adawluts' or Revenue Courts were established. These
courts were presided over by Collectors and appeals from their decisions
lay to Board of Revenue and then on to Governor-General-in-Council. By
Regulation II of 1793, Mal Adalats were abolished and jurisdiction was
transferred to Civil Courts. Collectors were made responsible only for
collection of revenue.
'Sadar Diwani' and 'Sadar Nizamat Adalats'
38. By Regulation of 1772, Sadar Dewani Adalat was instituted in the
Presidency under superintendence of three or more members of Council
to hear appeals from Diwani Adalats in causes exceeding value of five
hundred rupees. By same Regulation, 'Sadar Nizamut Adalat' was
established at Murshidabad. The jurisdiction of Dewani Adalat was
defined by Regulation III of 1793 whereby British subjects were expressly
excluded from their jurisdiction with certain exceptions. Designation of
Dewani Adalat established in Murshidabad, Dacca and Patna were named
after name of these cities, while of those established in several districts
(Zillahs) were named after the name of District/Zillah.
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39.By Regulation V of 1793 Provincial Courts of Appeal were
established, which, besides having Appellate jurisdiction, also had original
jurisdiction in certain matters. Appeals from Zillah and City Courts
(Dewani Adalats), which till then were directly admissible in Sadar
Dewani Adalat, were now to be filed in these Provincial Courts and
appeals against Provincial Courts were to be filed in Sadar Dewani Adalat.
40.In effect Sadar Dewani Adalat and Sadar Nizamat Adalat of Bengal
were presided over by Governor General and members of Supreme
Council. These courts were meant to dispense justice to local inhabitants
i.e. Indians and had no authority over British subjects.
Extension to North
41.The territory around Banaras was ceded to 'East India Company' by
Nawab Vazir of Awadh/Oudh in 1775. In 1781, Court of Justice vested
with Criminal jurisdiction was established in the city of Banaras. In 1788,
Courts with similar powers were established in districts of Ghazipur,
Jaunpur and Mirzapur. Resident at Banaras was to act as Magistrate
throughout the Province of Banaras. By Regulation XVI of 1795, Judges
of Dewani Adalats, which were established in the same year in the city of
Banaras and above mentioned three districts, were empowered to act as
Magistrates within their jurisdiction and this power which was being
exercised by Resident at Banaras was resumed from him. 'Court of
Circuit' having similar powers as those in Bengal for trial of serious
offences, was created by same Regulations in Banaras. This Court was
subordinate to 'Sadar Nizamat Adalat' of Bengal.
42.Regulation VII of 1795 caused establishment of 'Civil Courts' in
Banaras Province. City court in Banaras and three Zillah Courts (District
Courts) in Jaunpur, Mirzapur and Ghazipur were established. The
jurisdiction, power and authority enjoyed by similar courts in Bengal were
extended to these courts also. By Regulation IX of 1795, a Provincial
Court of Appeal was set up in Banaras to exercise jurisdiction in Banaras
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Province, which consisted of city of Banaras and three Districts of
Jaunpur, Mirzapur and Ghazipur. Provincial Court was to hear appeals
against judgments of City and Zillah Courts (District Courts). Appeal
against Provincial Courts lay to 'Sadar Dewani Adalat of Bengal, Bihar
and Orissa', jurisdiction thereof was extended to Banaras Province by
Regulation X of 1795.
43.In 1800, British Parliament enacted Government of India Act, 1800
(hereinafter referred to as “G.I. Act, 1800”) for Regulation of Government
of British Territories in India and better Administration of Justice within
the same. It conferred powers upon Court of Directors of East India
Company to declare which part or parts of territorial acquisitions or of any
other, now subject to the government of Presidency of Fort Saint George
or Presidency of Bombay, together with the revenues arising therefrom,
and the establishment of civil servants connected therewith, respectively,
shall from henceforth hereafter be subject to the government of either and
which of the said presidencies or of the Presidency of Fort William in
Bengal, and from time to time, as occasion may require, to revoke and
alter in the whole or in part such appointment, and to make such new
distribution of the same as to them shall deem fit and expedient, subject
nevertheless in all cases to the superintendence, direction and control of
the Commissioners for the affairs of India, in like manner as any Acts or
Orders of said Courts of Directors are now by law subject. They are also
given power to establish Court or Courts of Judicature. The British
Government also was given power to establish a Supreme Court at
Madras. Power of Supreme Court of Fort William in Bengal was extended
over the province of Banaras and all places subordinate thereto including
all districts thereafter annexed to the Presidency of Fort William.
44.Territory of 'East India Company' extended. In 1801 a major portion
of the area, later known as 'Agra Province', was ceded to British by
Nawab of Awadh. In 1803, Zillah Courts (District Courts) were
constituted in the districts of Moradabad, Bareilly, Etawah, Farrukhabad,
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Kanpur, Allahabad and Gorakhpur vide Regulation II of 1803. By
Regulation IV of 1803, a 'Provincial Court of Appeal' was established at
Bareilly for exercising appellate jurisdiction over these Zillah Courts
(District Courts). Appeals against decisions of Provincial Courts of appeal
was admissible in 'Sadar Dewani Adalat of Bengal'. Out of the territories
ceded by Peshwa and Daulat Rao Sindhia, six Districts were formed by
Regulation IX of 1804.
45.By Regulation VIII of 1805 five new Districts were formed out of
conquered provinces, within the Doab and on the right bank of Jamuna,
excepting Delhi, as also out of the territory of Bundelkhand ceded by the
Peshwa. These districts were Aligarh (at that time Allyghur), Northern
Zilla of Saharanpur, Southern Zilla of Saharanpur, Agra and Bundelkhand.
By same Regulations, Zilla Courts/District Courts were established in
these districts. Two parts of Saharanpur, however, were amalgamated in
1806. Appeals from these Zilla Courts/District Courts, lay to Provincial
Court established by Regulation IV of 1803 and further appeals to Sadar
Dewani Adalat of Bengal.
46.In 1817, Dehardun and Kumaon, which were acquired from Nepal,
were brought under above legal system vide Regulations IV and X. Some
defects were found in superintendence of Criminal and Revenue
Administration, hence nine Divisions were created in 1829, out of the
ceded and conquered territories, later known as 'North Western Provinces'
and each Division was placed under a 'Commissioner of Revenue and
Circuit'.
47.Provincial Courts of Banaras and Bareilly ceased to be 'Courts of
Circuit' and power to hold “sessions of goal delivery” enjoyed by them
was transferred to Commissioners vide Regulation I of 1829. The
amalgamation of Civil and Criminal jurisdiction was effectuated by
Regulation VII of 1831 providing for appointment of Zillah Judges as
Sessions Judges whenever deemed advisable, though appeals from the
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orders of Magistrates lay to Commissioner. Like Commissioner, the
Sessions Judges were subordinated to 'Sadar Nizamat Adalat of Bengal'.
To relieve Zillah and City Judges from pressure of work, a provision was
made for appointment of Principal Sadar Ameens, whenever necessary, by
Regulation V of 1831. They were to try such appeals, against decisions of
Munsifs, and original suits, not exceeding five thousand rupees, as the
Zillah or City Judges referred to them.
48.'Sadar Dewani' and 'Nizamat Adalats' established in Western
Provinces consisted of Province of Banaras and ceded and conquered
Provinces, in 1831, by Regulation VI, ordinarily to be stationed at
Allahabad and all the nine Divisions created in 1829 were placed within
its jurisdiction. These Courts were created to mitigate discontent and
dissatisfaction prevailed among the litigants due to expensive litigation,
difficulties and delay experienced in prosecuting appeals in Bengal. Later,
these two Courts, 'Sadar Dewani' and 'Nizamat Adalats' were shifted to
Agra.
49.By Regulation X of 1831 a Board of Revenue was created at
Allahabad. Revenue administration which was till then under Board of
Revenue in Bengal, was shifted to Board of Revenue at Allahabad. In
1833, by Regulation II, Provincial Courts of Appeal were abolished. Their
appellate jurisdiction including pending appeals, was transferred to 'Sadar
Dewani Adalat', while original jurisdiction including pending suits was
transferred to Zillah (District) and City Courts.
50.Government of India Act, 1833 (hereinafter referred to as “G.I. Act,
1833”) was enacted for effecting an arrangement with 'East India
Company' and for better government of His Majesty, Indian territory. Vide
Section 38 of G.I. Act, 1833, territories which were subject to government
of Presidencies of Fort William in Bengal were divided in two and another
Presidency was constituted as 'Presidency of Agra'. Power to divide
territories in the newly constituted Presidencies vis-à-vis existing
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Presidency was conferred upon Board of Directors of 'East India
Company'.
51.In 1836, 'North-Western Provinces' was formed out of the territory
around Banaras ceded by Oudh/Avadh in 1775, other territories ceded in
1801, conquered territories acquired from Maharaja of Sindhia in 1803, a
portion of Bundelkhand acquired from Peshwa and territory then known
as the hill districts acquired in 1816 from Nepal. The ceded territories
covered greater portion of Uttar Pradesh. Sagar and Narbada territories
ceded by Rulers of Nagpur, also became part of 'North Western
Provinces'.
52.Jhansi which lapsed to East India Company in 1853, became part of
North Western Province. Delhi territory which also formed part of the
North Western Provinces, later transferred to Punjab in 1858. In January
1858, Lord Canning proceeded to Allahabad forming 'North Western
Province' excluding Delhi Division.
53.Avadh/Oudh was annexed to territories of 'East India Company' in
1856. Twelve districts of Lucknow, Barabanki, Faizabad, Sultanpur,
Hardoi, Rae Bareilly, Pratapgarh, Unnao, Gonda, Bahraich, Sitapur and
Kheri were placed under a Chief Commissioner. Till annexation of
Avadh/Oudh to the territories of East India Company in 1856,
administration of justice therein was under a system laid by then Nawab
of Avadh. After annexation, Court of Appeal was established at Lucknow
with a Judicial Commissioner for disposal of Civil and Criminal cases.
54.After First war of independence in 1857, sovereignty was
transferred from 'East India Company' to 'British Government'. In 1861,
'Indian High Court Acts, 1861' and 'Indian Council Act, 1861' were passed
by British Parliament.
55.Indian High Courts Act, 1861 provided for abolition of Supreme
Courts of judicature established at Calcutta, Madras and Bombay as also
'Sadar Dewani Adalat'. It further provided for constitution of High Courts
Special Appeal No.1481 of 2007
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of Judicature in their places in above three Presidencies. Vide Section 16
of Indian High Courts Act, 1861, power was reserved to British Crown to
constitute similar High Courts in other territories which were not within
local jurisdiction of any of three proposed High Courts of Calcutta,
Bombay and Madras. Indian Council's Act 1861 empowered Governor
General to create local legislatures in various provinces.
56.Thereafter the only 'Sudder Court' which remained was “Court of
Sudder Dewani” and “Nizamat Adalat” for North-Western Provinces. This
Court sat at Agra, although Bengal Regulation VI of 1831 provided that it
was “to be ordinarily stationed at Allahabad”. On 17.03.1866 a Letters
Patent for creation of a High Court was issued whereupon Court of Sudder
Diwanny and Nizamut Adalat ceased to exist in North-Western Provinces
and a High Court came into existence called as “High Court of Judicature
for North-Western Provinces”. Aforesaid Charter conferred jurisdiction
upon newly formed High Court in respect of Civil, Criminal,
Testamentary and Interstate as well as Matrimonial matters. First sitting of
High Court took place at Agra on 18.06.1866, but in 1868 it was shifted to
Allahabad.
57.With regard to Avadh/Oudh, as we have already noticed, a Judicial
Commissioner was appointed for disposal of Civil and Criminal cases.
Court of Appeal was established in Lucknow in 1856 with a Judicial
Commissioner. Initially there was only one Judicial Commissioner but he
was not the highest Court of Appeal in rent and revenue cases. System of
dispensation of justice in Oudh/Avadh was different for the reason that
Regulations of Bengal did not apply to Oudh/Avadh. Hence like other
Non Regulation Provinces, it also remained None Regulation Territory.
58.After annexation in 1856, various grades of posts were established
vide Act XIV of 1865, similar to those provided for Central Provinces
under the same Act. The aforesaid Act was framed chiefly with reference
to Central Province. It was found incomplete and inconvenient as regards
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Oudh/Avadh.
59.Accordingly, in 1871, Oudh Civil Courts Act (Act No.XXXII of
1871) was passed by Governor General-in-Council to consolidate and
amend laws relating to Civil Courts in Avadh. Besides constituting Civil
Courts in a reformed shape, Judicial Commissioner's Court was re-
constituted as the highest Court. Five grades of Courts were constituted
i.e. (1) Tehsildar (2) Assistant or Extra Assistant Commissioner (3)
Deputy Commissioner or Civil Judge of Lucknow (4) Commissioner and
(5) Judicial Commissioner. General control over all Courts of first and
second grades in any District vested in Deputy Commissioner and control
over courts of first three grades, in any Division, vested in Commissioner,
subject to superintendence of Judicial Commissioner. Court of Deputy
Commissioner was Principal Civil Court of original jurisdiction in any
district. He could direct business in the Courts of first and second grades
to be distributed amongst such courts as he found fit, having regard to
limits of their jurisdiction. He entertained appeals from those courts
except when the amount in dispute exceeded Rs.1000/- in which case
appeal lay before Deputy Commissioner and Commissioner and then to
Judicial Commissioner who was empowered to refer cases, in which he
entertainrf any doubt, to High Court of North Western Provinces.
60.Inter relationship of Judicial Commissioner's power vis a vis North-
Western Province High Court established under Indian High Courts Act,
1861 by Charter dated 17.03.1866 is discernible from Section 23 of Act
XXXII of 1871, which reads as under :-
“23. When the Judicial Commissioner entertains any
doubt as to the decision to be passed on any appeal under
this Act, he may make a reference to the High Court of the
North-Western Provinces of the Presidency of Bengal, and
shall transmit the record of the case referred, and all the
proceedings connected therewith, to the said Court.”
(emphasis added)
61.A perusal of aforesaid provision shows that a Judicial
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Commissioner in Oudh Provinces, if had any doubt as to the decision to
be given by him, he would make reference to North-Western Provinces
High Court and then the case had to be decided in accordance with
judgment of High Court of North Western Provinces.
62.Offices of Lieutenant Governor of North-Western Provinces and
Chief Commissioner of Oudh were combined in the same person in 1877.
63.As already said Judicial Commissioner was not the highest Court of
Appeal in rent and revenue cases. For this purpose there was Financial
Commissioner as higher Court. But Court of Financial Commissioner was
abolished by Act No.XXXII of 1871 and his work was also entrusted to
Judicial Commissioner. Civil Courts, on the lines of those in the North-
Western Provinces, were established in Oudh/Avadh by Act No.XIII of
1879, which was amended by Act No.XVI of 1891. The same established
following grades of Civil Courts in Oudh/Avadh :
(i) Court of Judicial Commissioner
(ii) Court of District Judge
(iii) Court of Subordinate Judge
(iv) Court of Munsif
64.Since, work was on increase, by subsequent enactments i.e. Act IV
of 1885, power was given to make temporary appointments and thereafter
by Act XIV of 1891, Oudh Courts Act, provision was made for
appointment of permanent 'Additional Judicial Commissioner', equal in
status but not in emoluments to 'Judicial Commissioner'. By Act XVI of
1897, provision was made for Second Additional Judicial Commissioner
but salary between Judicial Commissioner and Additional Judicial
Commissioner remained different i.e. Rs.3500/- per mensem to Judicial
Commissioner and Rs.3333/- per mensem to Additional Judicial
Commissioner.
65.Thereafter in 1902, new name to two Provinces was given i.e.
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“United Province of Agra and Oudh”. It became 'Uttar Pradesh' on
24.01.1950 under United Provinces (Alteration of Name) Order, 1950
(hereinafter referred to as “Order 1950”).
66.With an intention to provide larger power in provincial matters to
the Provinces, G.I. Act, 1915-1919 was enacted. We are confining
ourselves to the part of aforesaid Act which relates with Indian High
Courts which was contained in 'Part IX' running from Sections 101 to 114.
It recognizes High Courts established by Letters Patent only as the 'High
Courts' under the aforesaid Act. Section 101 (1) of G. I. Act, 1915-1919
reads as under :
“101. Constitution of high courts.-(1) The high courts
referred to in this Act, are the high courts of judicature
for the time being established in British India by letters
patent.”
(emphasis added)
67.However, by Section 101 (5) of G. I. Act, 1915-1919, it renominates
'High Court for the North Western Provinces' and titled as “High Court of
Judicature at Allahabad”. The Court at Fort William in Bengal was made
as “High Court of Judicature at Calcutta”. Section 101 (5) of G. I. Act,
1915-1919 reads as under :
“101.(5). The high court for the North-Western Provinces
may be styled the high court of judicature of Allahabad,
and the court at Fort William in Bengal is in this Act
referred to as the high court at Calcutta.”
(emphasis added)
68.Section 106 of G. I. Act, 1915-19 declares jurisdiction of High
Courts and reads as under :
“106. Jurisdiction of high courts.-(1) The several high
courts are courts of record and have such jurisdiction,
original and appellate, including admirality jurisdiction, in
respect of offences committed on the high seas, and all such
Special Appeal No.1481 of 2007
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powers and authority over or in relation to the
administration of justice, including power to appoint clerks
and other ministerial officers of the court, and power to
make rules for regulating the practice of the court, as are
vested in them by letters patent, and, subject the provisions
of any such letters patent, all such jurisdictions, powers and
authority as are vested in those courts respectively at the
commencement of this Act.”
69.System of 'Judicial Commissioner' in Oudh/Avadh came to an end
when U. P. Legislature with previous sanction of Governor General, as
required under Section 80-A(3) of G. I. Act, 1915-1919, passed 'Oudh
Court's Act', U.P. Act No.4 of 1925 (hereinafter referred to as “U. P. Act,
1925”). The local legislature of United Provinces of Agra and Oudh
passed U. P. Act of 1925 and it received assent of Governor of United
Provinces of Agra and Oudh on 03.04.1925 and Governor General on
04.05.1925. It was published under Section 81 of G.I. Act, 1915-1919 on
16.05.1925. Preamble of U. P. Act, 1925 stated that it was enacted to
amend and consolidate the laws relating to the Courts in Oudh. Section 3
of Act, 1925 provided that on and from commencement of said Act there
shall be established for Oudh a 'Chief Court' referred to as “Chief Court”.
70.Section 4 of Act, 1925 talked of constitution of Chief Court and
provides that “Chief Court” shall consist of a Chief Judge and four or
more Judges who shall be appointed by Governor General-in-Council.
The Judges including 'Chief Judge' were to be appointed from three
sources namely :-
“(a) Barristers, Advocates and Vakils of a High or Chief
Court including the former Judicial Commissioner's Court
in Oudh of not less than ten years' standing; at least two.
(b) Members of the Indian Civil Service of not less than ten
years' standing, and having for at least three years served
as, or exercised the powers of, a District Judge; at least
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two.
(c) Members of the United Provinces Civil Service who
have held judicial office not inferior to that of a
Subordinate Judge or a Judge of a Small Cause Court for a
period of not less than five years; at least one.”
71.Proviso of Section 4 of U. P. Act, 1925 provided that if one of the
Judges, who is a member of Indian Civil Service, has been promoted from
United Provinces Civil Service, it shall not be necessary to appoint any
other Judge from United Provinces Civil Service.
72.Section 8 and 9 of U. P. Act, 1925 provided that 'Chief Court' shall
be deemed to be 'highest Court of appeal and revision' for civil appellate
jurisdiction and criminal jurisdiction. By Section 21 of U. P. Act, 1925,
four grades of Civil Courts in Oudh were contemplated and it said as
under :
“21. Besides the Chief Court, the Courts of Small Causes
established under the Provincial Small Cause Courts Act,
1887, and the Courts established under any other enactment
for the time being in force, there shall be four grades of Civil
Courts in Oudh namely,-
(1) The Court of the District Judge.
(2) The Court of Additional Judge.
(3) The Court of the Subordinate Judge.
(4) The Court of the Munsif.”
73.In 1935 Government of India Act, 1935 (hereinafter referred to as
“G.I.Act, 1935”) was passed. Section 219 thereof talked of the meaning of
'High Court' and reads as under :
“219.-(1) The following courts shall in relation to British
India be deemed to be High Courts for the purposes of this
Act, that is to say, the High Courts in Calcutta, Madras,
Bombay, Allahabad, Lahore and Patna, the Chief Court in
Oudh, the Judicial Commissioner's Courts in the Central
Provinces and Bear, in the North-West Frontier Province
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and in Sind, any other court in British India constituted or
reconstituted under this chapter as a High Court, and any
other comparable court in British India which His Majesty
in Council may declare to be a High Court for the purposes
of this Act.
Provided that, if provision has been made before the
commencement of Part III of this Act for the establishment
of a High Court to replace any court or courts mentioned in
this subsection, then as from the establishment of the new
court this section shall have effect as if the new court were
mentioned therein in lieu of the court or courts so replaced.
(2) The provisions of this chapter shall apply to every High
Court in British India.”
(emphasis added)
74.Therefore, 'Chief Court in Oudh' was included within the meaning
of 'High Court' by G.I. Act, 1935. Section 229 of G. I. Act, 1935 gave
power to British Crown to constitute a High Court by Letters Patent for
any Province or any part thereof or reconstitute, in like manner, any
existing High Court for that Province or for any part thereof or where
there are two High Courts in that Province, amalgamate that Courts.
Section 229 reads as under :
“229.-(1) His Majesty, if the Chamber or Chambers of the
Legislature of any Province present an address in that behalf
to the Governor of the Province for submission to His
Majesty, may by letters patent constitute a High Court for
that Province or any part thereof or reconstitute in like
manner any existing High Court for that Province or for
any part thereof, or, where there are two High Courts in
that Province, amalgamate those courts.
(2) Where any Court is reconstituted, or two Courts are
amalgamated, as aforesaid, the letters patent shall provide
for the continuance in their respective offices of the existing
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judges, officers and servants of the Court or Courts, and for
the carrying on before the reconstituted Court or the new
Court of all pending matters, and may contain such other
provisions as may appear to His Majesty to be necessary by
reason of the reconstitution or amalgamation.”
(emphasis added)
75.In 1948, Governor General in exercise of powers under Section 229
of G.I. Act, 1935 issued U. P. High Courts (Amalgamation) Order, 1948
published in Gazette of Govt. of India (Extraordinary) dated 19.07.1948.
It provided that it shall come into force from the date of publication i.e.
19.07.1948. In Article/Clause 2, it defines two terms i.e. “appointed day”
and “existing High Courts” and same read as under :
“2.(1) In this order-
“appointed day” means the twenty-sixth day of July, 1948;
and
“existing High Courts” means the High Courts referred to
in Section 219 of the Act, as the High Court in Allahabad
and the Chief Court in Oudh.
(2) The Interpretation Act, 1889, applies for the
interpretation of this Order as it applies for the
interpretation of an Act of Parliament.”
(emphasis added)
76.Article/Clause 3 of U. P. High Courts (Amalgamation) Order, 1948,
provided that from appointed day i.e. 26.07.1948, High Court in
Allahabad and Chief Court in Oudh/Avadh shall be amalgamated and
shall constitute one High Court in the name of “High Court of Judicature
at Allahabad”, In subsequent part of Order, 1948 it has been referred as
“New High Court”. Article/Clause (3) is reproduced hereinunder :
“3. As from the appointed day, the High Court in Allahabad
and the Chief Court in Oudh shall be amalgamated and shall
constitute one High Court by the name of the High Court of
Judicature at Allahabad (hereinafter referred to as “the new
High Court”).”
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(emphasis added)
77.All the existing Judges, whether Permanent or Additional and
Acting Judges in the existing High Court, became Judges in the same
capacity of “New High Court”. Article/Clause 5 provided that the person
who, immediately before appointed day, is the Chief Justice of High Court
in Allahabad shall be the Chief Justice of “New High Court”, meaning
thereby Chief Justice of High Court in Allahabad became Chief Justice of
Amalgamated High Court i.e. “New High Court”. Article/Clause 5 (2)
provided the order of other Judges i.e. Chief Judge of High Court in
Oudh/Avadh, Puisne Judges of High Court in Allahabad and Puisne
Judges of Chief Court in Oudh/Avadh and additional and acting Judges. It
says that firstly, the former Chief Judge of High Court in Oudh/Avadh and
former Puisne Judges of the High Court in Allahabad, shall be placed
according to the priority of their respective appointments in their capacity
and thereafter, former Puisne Judges of Chief Court in Oudh/Avadh
according to the priority of their respective appointments shall be placed.
78.Article/Clause 5 (3) of U. P. High Courts (Amalgamation) Order,
1948, provided an order of Additional and Acting Judges according to
priority of their respective appointments in either of the existing High
Courts. All existing staff i.e. Officers and servants of existing High Courts
were declared as deemed to have been appointed in corresponding
position in the “New High Court”, on the same terms and conditions.
79.Article/Clause 7 of U. P. High Courts (Amalgamation) Order, 1948,
provided jurisdiction of “New High Court” and reads as under :
“7.(1) The new High Court shall have, in respect of the
whole of the United Provinces, all such original , appellate
and other jurisdiction as, under the law in force immediately
before the appointed day is excercisable in respect of any
part of that Province by either of the existing High Courts.
(2) The new High Court shall also have in respect of any
area outside the United Provinces all such original,
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appellate and other jurisdiction as under the law in force
immediately before the appointed day is exercisable in
respect of that area by the High Court in Allahabad.”
(emphasis added)
80.Thus, the “New High Court” as provided in Article/Clause 7 of
Order, 1948, was conferred with jurisdiction in the entire United
Provinces and also in respect of the area outside the United Provinces if it
was exercising jurisdiction before “appointed day” in respect of such area.
81.Article/Clause 7 of U. P. High Courts (Amalgamation) Order 1948
thus makes it very clear that jurisdiction in respect of whole of United
Provinces in all subjects and other matters which was being exercised by
existing High Courts, shall be exercised by New High Court i.e. High
Court of Judicature at Allahabad. This jurisdiction was given to High
Court of Judicature at Allahabad by Article/Clause 7, which does not
require any order of Chief Justice but it comes by way of declaration
made under Article/Clause 7 as such. However, a distinction was created
in subsequent provisions with respect to sitting of some Judges of High
Court of Judicature at Allahabad, at Lucknow, and jurisdiction to be
exercised thereat. This was to be done by an order/notification of Chief
Justice of High Court of Judicature at Allahabad, otherwise the entire
jurisdiction by declaration of law was at High Court of Judicature at
Allahabad.
82.Article/Clause 9 of U. P. High Courts (Amalgamation) Order, 1948,
provided application of laws relating to practice and procedure. It says
that such laws as were enforced immediately before “appointed day” with
respect to practice and procedure in High Court in Allahabad, with
necessary modifications, shall apply in relation to “New High Court” and
the power available to High Court in Allahabad before “appointed day”
for making Rules and Orders in respect of practice and procedure, shall
continue to be exercised accordingly. However, Chief Justice of “New
High Court” was also given power by proviso to allow provisions with
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modifications in respect of practice and procedure in the “New High
Court”sitting at Lucknow. Article/Clause 9 of Order, 1948, reads as
under :
“9. Subject to the provisions of this Order, the law in force
immediately before the appointed day with respect to
practice and procedure in the High Court in Allahbad
shall, with the necessary modifications apply in relation to
the new High Court and accordingly that hiogh Court shall
have all such powers to make rules and orders with respect
to practice and procedure as are immediately before the
appointed day exercisable by the High Court in Allahabad:
Provided that any rules or orders which are in force
immediately before the appointed ay with respect to practice
and procedure in the High Court in Allahabad shall, until
varied or revoked by rules or orders made for the new
High Court, apply with the necessary modifications in
relation to practice and procedure in the new High Court
as if made by that Court:
Provided further the Chief Justice may, in his
discretion order that any rules or orders which were in
force immediately before the appointed day with respect to
practice and procedure in the Chief Court in Oudh shall,
until varied or revoked by new rules or orders made for the
new High Court, apply with the necessary modifications in
relation to practice and procedure in the new High Court
sitting at Lucknow.”
(emphasis added)
83.In respect of Subordinate Courts, Article/Clause 10 of Order, 1948,
provided that until varied or revoked, the existing provisions made in
respect of High Courts will continue to apply with necessary
modifications.
84.With respect of seal of High Court, Article/Clause 11 of U. P. High
Courts (Amalgamation) Order, 1948, provides as under :
“11.(1) The new High Court shall have a seal of such form
and design as the Chief Justice may direct.
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(2) The law in force immediately before the appointed day
with respect to the custody of the seal of the High Court in
Allahabad shall, with the necessary modifications, apply
with respect to the custody of the seal of the new High
Court.”
85.In respect of form of writs and other processes used, issued or
awarded, law in force by High Court in Allahabad with necessary
modifications would apply to “New High Court” vide Article/Clause 12 of
U. P. High Courts (Amalgamation) Order, 1948, which reads as under :
“12. The law in force immediately before the appointed day
with respect to the form of writs and other processes used,
issued or awarded by the High Court in Allahabad shall,
with the necessary modifications, apply with respect to the
form of writs and other processes used, issued or awarded
by the new High Court.”
(emphasis added)
86.Article/Clause 12 of U. P. High Courts (Amalgamation) Order, 1948
shows that with respect to forms of writs and other processes used, issued
or awarded, procedure at High Court in Allahabad was applied with
necessary modifications, if any, to New High Court i.e. High Court of
Judicature at Allahabad, whether the Judges are sitting at Allahabad or
Lucknow irrespective thereof.
87.The law in force immediately before the “appointed day” relating to
the powers of Chief Justice, Single Judges and Division Courts of High
Court in Allahabad and with respect to all matters ancillary to the exercise
of those powers, with necessary modifications, was to apply in relation to
“New High Court” as per Article/Clause 13 of U. P. High Courts
(Amalgamation) Order, 1948.
88.Then comes Article/Clause 14 of Order, 1948, which talked of
sitting of “New High Court” and it reads as under :
“14. The new High Court and the Judges and Division
Courts thereof, shall sit at Allahabad or at such other
places in the United Provinces as the Chief Justice may,
Special Appeal No.1481 of 2007
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with the approval of the Governor of the United Provinces,
appoint :
Provided that unless Governor of the United
Provinces with the concurrence of the Chief Justice,
otherwise directs, such Judges of the new High Court, not
less than two in nubmer, as the Chief Justice, may, from
time to time nominate, shall sit at Lucknow, in order to
exercise in respect of cases arising in such areas in Oudh,
as the Chief Justice may direct, the jurisdiction and power
for the time being vested in the new High Court.
Provided further that the Chief Justice may in his
discretion order that any case or class of cases arising in
the said areas shall be heard at Allahabad.”
(emphasis added)
89.Article/Clause 15 of U. P. High Courts (Amalgamation) Order,
1948, applied laws in respect of appeals to His Majesty in Council or to
Federal Court from High Court in Allahabad to be applied to “New High
Court”.
90.Article/Clause 16 of U. P. High Courts (Amalgamation) Order,
1948, made a declaration that all proceedings before “appointed day” in
either of the existing High Courts shall stand transferred to “New High
Court” and shall continue as if they had been proceedings instituted in that
High Court.
91.By virtue of Article/Clause 17 of U. P. High Courts (Amalgamation)
Order, 1948, Letters Patent dated 17.03.1866 whereby 'High Court of
Judicature for North Western Provinces' was established and Chapter II of
Oudh Courts Act, 1925, were declared to have ceased, except for the
purpose of construing or giving effect to provisions of Order, 1948.
Similar omissions in respect of “Government of India (High Court Judges)
Order, 1937” were made vide sub section (b) of Article/Clause 17. It is
declared by Article/Clause 17 (c) that references in any Indian Law to
either of the existing High Courts shall, unless the context otherwise
requires, be construed as references to the “New High Court”. It would be
Special Appeal No.1481 of 2007
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appropriate to reproduce Article/Clause 17 also hereat :
“17. As from the appointed day-
(a) the Letters patent of Her Majesty, dated the 17
th
March,
1866, establishing the High Court of Judicature for the
North-Western Provinces and Chapter II of the Oudh Courts
Act, 1925 (U. P. Act IV of 1925), shall cease to have effect
except for the purpose of construing or giving effect to, the
provisions of this order;
(b) the Government of India (High Court Judges) order,
1937, shall be further amended as follows :
(i) in the First Schedule in the entry relating to the High
Court at Allahabad, for the figures “12” the figures “21”
shall be substituted and the entry relating to the Chief
Court of Oudh shall be omitted; and
(ii) in the Second Schedule, the entry relating to the Chief
Court of Oudh shall be omitted and in the Note, the words
“a Chief Judge and an acting Chief Judge” shall be
omitted.
(c) references in any Indian Law to either of the existing
High Courts by whatever name shall, unless the context
otherwise requires, be construed as references to the new
High Court.”
(emphasis added)
92.Article/Clause 14 of U. P. High Courts (Amalgamation) Order,
1948, thus provided sitting of “New High Court” at Allahabad. It further
says that in the alternative, it may be such other places in the United
Province as the Chief Justice with approval of Governor of United
Province, appoints. First Proviso to Article/Clause 14 says that unless
Governor of United Province with the concurrence of Chief Justice,
otherwise directs, such Judges of “New High Court”, not less than two in
number, as the Chief Justice, may, from time to time nominate, shall sit at
Lucknow, in order to exercise jurisdiction in respect of cases arising in
such areas in Oudh/Avadh, as the Chief Justice may direct, jurisdiction
and power for the time being vested in the “New High Court”.
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93.A bare reading of Article/Clause 14 of U. P. High Courts
(Amalgamation) Order, 1948, shows that general provision in respect of
sitting of “New High Court” is at Allahabad or such other places in the
United Provinces as the Chief Justice with approval of Governor of
United Provinces, appoints. First proviso, however, makes an exception in
respect of Lucknow. It provides that unless Governor of United Provinces,
in concurrence with the Chief Justice, otherwise directs, such Judges of
“New High Court” but not less than two, as nominated by Chief Justice,
would sit at Lucknow and exercise jurisdiction in respect of cases arising
in such areas in Oudh/Avadh as Chief Justice may direct, the jurisdiction
and power vested in “New High Court”.
94.Therefore, Article/Clause 14, First Proviso of U. P. High Courts
(Amalgamation) Order, 1948, provides, while declaring that sitting of
“New High Court” would be at Allahabad and Judges and Division Courts
thereof shall sit thereat but in respect of cases arising in such areas of
Oudh/Avadh, as Chief Justice may direct, at least two Judges as
nominated by Chief Justice shall sit at Lucknow and exercise jurisdiction
of “New High Court” thereat. The number of Judges required to sit at
Lucknow may be increased by Chief Justice of “New High Court” but it
cannot be less than two. Judges who are not nominated to sit at Lucknow,
by virtue of principal clause of Article/Clause 14, shall sit at Allahabad.
The power, however, has been given to Chief Justice to appoint instead of
Allahabad, other place in the United Province for sitting of “New High
Court”.
95.The word “or” used in Article/Clause 14, in the context of sitting at
Allahabad, came up for consideration before a Full Bench of this Court
and ultimately it has been settled by Supreme Court wherein reversing
judgment of this Court, where word “or” was read as “and”, Supreme
Court said that it is “or” and cannot be read as “and”, meaning thereby,
under Article/Clause 14, sitting of “New High Court” shall be either at
Allahabad or such other place as appointed by Chief Justice. In regard to
Special Appeal No.1481 of 2007
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the cases arising in respect of such areas of Oudh/Avadh as the Chief
Justice directs, First Proviso of Article/Clause 14 provides that at least two
Judges shall sit at Lucknow and exercise jurisdiction thereat.
96.Second proviso to Article/Clause 14 further confers power upon
Chief Justice to pass order in respect of any case or class of cases, arising
in the area of Oudh/Avadh, entertained by Judges sitting at Lucknow, to
be heard at Allahabad.
97.These provisions of U. P. High Courts (Amalgamation) Order, 1948
and in particular Article/Clause 14 of U. P. High Courts (Amalgamation)
Order, 1948 came up for consideration before a five Judges Bench of this
Court in Sri Nirmal Das Khaturia and others vs. State Transport
(Appellate) Tribunal, U. P. Lucknow, AIR 1972 Alld. 200. Four
questions were referred for consideration by Larger Bench and fifth was
formulated by Larger Bench itself and these five questions were as
under :-
“(1) Can a case falling within the jurisdiction of the
Lucknow Bench of this Court be presented at Allahabad?
(2) Can the judges sitting at Allahabad summarily dismiss a
case presented at Allahabad pertaining to the jurisdiction of
the Lucknow Bench?
(3) Can a case pertaining to the jurisdiction of Lucknow
Bench, presented and entertained at Allahabad, be decided
finally by the judges sitting at Allahabad, without there
being an order as contemplated by the second proviso to
Article 14 of the U. P. High Court (Amalgamation) Order,
1948?
(4) What is the meaning of the expression “in respect of
cases arising in such areas in Oudh” used in first proviso to
Article 14 of the High Court (Amalgamation) Order, 1948?
Has this expression reference to the place where the case
originated or to the place of the sitting of the last court or
authority whose decree or order is being challenged in the
proceedings before the High Court?
Special Appeal No.1481 of 2007
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(5) Whether this writ petition can be entertained, heard and
decided by the Judges sitting at Lucknow?”
98.Above questions were answered by Larger Bench as under :
“(1) A case falling within the jurisdiction of judges at
Lucknow should be presented at Lucknow and not at
Allahabad.
(2) However, if such a case is presented at Allahabad, the
judges at Allahabad cannot summarily dismiss it only for
that reason. The case should be returned for filing before
the judges at Lucknow and where the case has been
mistakenly or inadvertently entertained at Allahabad, a
direction should be made to the High Court office to
transmit the papers of the case to Lucknow.
(3) A case pertaining to the jurisdiction of the judges at
Lucknow and presented before the judges at Allahabad
cannot be decided by the judges at Allahabad in the
absence of an order contemplated by the second proviso to
Article 14 of the Amalgamation Order, 1948.
(4) The expression “in respect of cases arising in such areas
in Oudh” used in the first proviso to Article 14 of the High
Court (Amalgamation) Order, 1948, refers to legal
proceedings, including civil cases, criminal cases, petitions
under Articles 226, 227 and 228 of the Constitution and
petitions under Articles 132, 133 and 134 of the
Constitution instituted before the judges sitting at Lucknow
and having their origin, in the sense explained in the
majority judgment in such areas in Oudh as the Chief
Justice may direct. The expression “arising in such areas in
Oudh” refers to the place where the case originated in the
sense explained in the majority judgment and not to the
place of sitting of the last court or authority whose decree
or order is being challenged in the proceeding before the
High Court.
(5) The Lucknow Bench have no jurisdiction to hear Writ
Petition No.750 of 1964 which gave rise to Writ Petition
No.3294 of 1970.”
(emphasis added)
Special Appeal No.1481 of 2007
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99.Matter went in appeal before Supreme Court and decided vide
judgment in Sri Nasiruddin vs. State Transport Appellate Tribunal
(supra). Supreme Court examined correctness of finding of this Court that
“New High Court” has its seat at Allahabad, which is a “permanent seat”
and the word “or” occurring in the main provision of Article/Clause 14 of
U. P. High Courts (Amalgamation) Order, 1948 is to be read as “and”,
meaning thereby that sitting shall be at Allahabad and such other places as
appointed by Chief Justice. Another finding of Court was is respect of
area of Oudh/Avadh and this Court said that Chief Justice can even reduce
area to the extent of abolition of sitting of Judges at Lucknow and
allocation of jurisdiction shall also be in the domain of Chief Justice.
Further, Second Proviso was read by this Court that Chief Justice can pass
such an order in respect of cases within jurisdiction of Lucknow to be
filed at Allahabad or in a pending case to be transferred at Allahabad to be
heard thereat. This Court said that the word 'heard' in Second Proviso
applies not only to pending cases but also to cases which are yet to be
filed. This Court also said that if an appeal or revision is filed to an
authority within area of Lucknow, though original proceedings had arisen
in an area outside the jurisdiction of Judges sitting at Lucknow, then writ
petition under Article 226 would lie in the High Court depending on
original area where cause of action has arisen and not because appellate or
revisional order was passed by authority sitting in jurisdiction of Judges at
Lucknow. These parts of findings were not found correct by Supreme
Court. In para 27 of judgment in Sri Nasiruddin (supra), Court held that
reasoning of High Court that 'permanent' seat is at Allahabad is not sound.
Court said that word “or” cannot be read as “and”. In para 29 of judgment,
construing Article/Clause 14 of U. P. High Courts (Amalgamation) Order,
1948, Court said :-
“29. The Order describes the High Court as the new High
Court. The two High Courts have amalgamated in the new
High Court. The seat is at Allahabad or at such other places
as may be determined. There is no permanence attached to
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Allahabad. If that were the intention of the Order, the word
“and” instead of the word “or” would have been used.
Other places may be determined by the Chief Justice in
consultation with the Governor. It is left to prudence of the
authorities mentioned as to what other places should be
determined. In the normal understanding of the matters, it
is left to the discretion of the authorities as to whether the
seats at Allahabad as well as at Lucknow will be changed.
Both places may continue. Both places may be changed.
Lucknow is the seat of the Government. Allahabad has also
the history that the High Court was there before the Order.
Lucknow has been the principal place of Oudh. The Order
aimed at giving status to the Oudh Chief Commissioner's
Court as that of the High Court. It is difficult to foresee the
future whether the authorities will change the location to
other places but no idea of permanent seat can be read into
the Order. One can only say that it is the wish and hope that
both Allahabad and Lucknow will be the two important seats
so that history is not wiped out and policy is not changed.”
(emphasis added)
100.The above decision has been followed and reiterated in U. P.
Rashtriya Chinni Mills Adhikari Parishad, Lucknow vs. State of U. P.
and others, 1995 (4) SCC 738, and Court said that amalgamation order is
a special law which must prevail over general law. Law laid down by four
Judges Bench of Supreme Court in Sri Nasiruddin (supra) holds good
despite incorporation of explanation to Section 141 of Code of Civil
Procedure, 1908 (hereinafter referred to as “C.P.C.”).
101.Again the law has been reiterated in Kusum Ingots and Alloys
Ltd. vs. Union of India and others, 2004 (6) SCC 254. There, Company
was registered under Act, 1956 with registered Office at Mumbai. It had
obtained loan from Bhopal Branch of State Bank of India. Notice for
repayment was issued by Bank's Branch at Bhopal in terms of
Securitisation and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (hereinafter referred to as “Act, 2002”)
promulgated by Parliament. Vires of Act, 2002 was challenged in Writ
Special Appeal No.1481 of 2007
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Petition at Delhi High Court which was dismissed on the ground of
territorial jurisdiction and matter came to Supreme Court. Supreme Court
said that mere passing of legislation by itself would not confer any right to
file writ petition unless a cause of action arises therefor. A parliamentary
legislation when received assent of President and published in official
gazette unless specifically excluded will apply to entire territory of India.
If passing of a legislation would give rise to a cause of action, a writ
petition questioning constitutionality thereof can be filed in any High
Court of the country. However, it is not correct for the reason that the
cause of action will arise only when provisions of Act or some of them
which are implemented shall give rise to civil or evil consequences of a
party for the reason that Writ Court would not determine a constitutional
question in vaccum. Court must have requisite territorial jurisdiction and
an order passed on a writ petition questioning constitutionality of a
Parliamentary Act will have effect throughout the territory of India subject
to the course of applicability of act. The mere fact that seat of Union of
India is at Delhi, would not confer a territorial jurisdiction to High Court
at Delhi to entertain writ petition questioning constitutionality of
Parliamentary Act. Referring to Supreme Court judgment in Nasiruddin
(supra) and U. P. Rashtriya Chinni Mill (supra), Court said in paras 25,
26, 27 as under :
“25. The said decision is an authority for the proposition
that the place from where an appellate order or a revisional
order is passed may give rise to a part of cause of action
although the original order was at a place outside the said
area. When a part of the cause of action arises within one
or the other High Court, it will be for the petitioner to
choose his forum.
26. The view taken by this Court in U.P. Rashtriya Chini
Mill Adhikari Parishad, Lucknow (supra) that situs of
issue of an order or notification by the Government would
come within the meaning of expression 'cases arising' in
clause 14 of the (Amalgamation) Order is not a correct
Special Appeal No.1481 of 2007
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view of law for the reason hereafter stated and to that
extent the said decision is overruled. In fact, a legislation, it
is trite, is not confined to a statute enacted by the
Parliament or Legislature of a State, which would include
delegated legislation and subordinate legislation or an
executive order made by the Union of India, State or any
other statutory authority. In a case where the field is not
covered by any statutory rule, executive instruction issued in
this behalf shall also come with within the purview thereof
situs of office of the Parliament, Legislature of a State or
authorities empowered to make subordinate legislation
would not by itself constitute any cause of action or cases
arising. In other words, framing of a statute, statutory rule
or issue of an executive order or instruction would not
confer jurisdiction upon a court only because of the situs
of the office of the maker thereof.
27. When an order, however, is passed by a Court or
Tribunal or an executive authority whether under provisions
of a statute or otherwise, a part of cause of action arises at
that place. Even in a given case, when the original
authority is constituted at one place and the appellate
authority is constituted at another, a writ petition would be
maintainable at both the places. In other words as order of
the appellate authority constitutes a part of cause of action,
a writ petition would be maintainable in the High Court
within whose jurisdiction it is situate having regard to the
fact that the order of the appellate authority is also required
to be set aside and as the order of the original authority
merges with that of the appellate authority.”
(emphasis added)
102.The above findings in Sri Nasiruddin (supra) show that Supreme
Court held that it is in the prudence of the authorities to decide whether
seats at Allahabad as well as Lucknow will be changed. Both places may
continue and both places may be changed. Court clearly said that
Lucknow is the seat of Government and Allahabad has history of having
High Court there, before U. P. High Courts (Amalgamation) Order, 1948.
Further, Lucknow was principal place of Oudh/Avadh. U. P. High Courts
Special Appeal No.1481 of 2007
-43-
(Amalgamation) Order, 1948 aimed to give status to Oudh Chief
Commissioner's Court as that of High Court. Court said that it is difficult
to foresee what will happen in future whether authorities will change
location to other places but from reading of Article/Clause 14 of U. P.
High Courts (Amalgamation) Order, 1948 it is clear that there is no idea of
'Permanent Seat'. The aforesaid observations make it very clear that
findings of this Court that Allahabad is the 'Permanent Seat' of “New High
Court” as per U. P. High Courts (Amalgamation) Order, 1948 and in
particular Article/Clause 14 was not found correct, as no such
'permanence of seat', has been stated in U. P. High Courts (Amalgamation)
Order, 1948, but there is no discussion or reference in the context of
'Principal Seat' of “New High Court”, since that was not an issue before
Supreme Court.
103.The concept of 'Principal Seat' of High Court has arisen
subsequently when taking away power of judicial review of High Court in
certain matters, by constituting quasi judicial bodies like Tribunals, place
of sitting was decided by government and issue was raised whether for
several High Courts only one Tribunal at one place would be justified or
what should be the situs of such Tribunals in the context of Principal seat
of High Courts. Supreme Court's dictum in Sri Nasiruddin (supra) in
para 29 is in the context of finding of this Court that Allahabad is the
'Permanent Seat' of “New High Court” under U. P. High Courts
(Amalgamation) Order, 1948, but it has nothing to do with the question
with regard to 'Principal Seat' of High Court.
104.The word “Permanent” has a different connotation than the word
“Principal” and two cannot be equated together. If any institution or body
has its place of sitting at more than two places and such places are liable
to be changed, it may be said that there is no 'permanent place' of sitting
of such bodies, but when the question arises as to out of more than one
place of sitting which place is the 'principal place' of such body, it has to
be decided in the context of the constitution of the body, the work being
Special Appeal No.1481 of 2007
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discharged at different places of sitting and which place is broadly
controlling general functions of Institution and body etc.
105.The meaning and connotation of words “Principal” and
“Permanent” as we have already discussed are different and it would be
prudent to refer meanings of two terms as defined in general as well as
legal dictionaries :-
Meaning of “Principal”
(1) Collins Cobuild Advanced Learner's English Dictionary,
Fourth Edition, Page-1134 :-
“Principal-Principal means first in order of importance”
(2) Black's Law Disctionary, Eighth Edition, Page-1230 :-
“Principal-Chief, primary, most important, one who authorizes
another to act on his or her behalf as an agent.”
(3) Dr. A. R. Biswas Encyclopaedic Law Dictionary (Legal and
Commercial), 3
rd
Ediction 2008, Page-1156 :-
“Principal-the person for whom an act is done by the agent is
called 'principal'; a person who employs an agent to do some act
for him.”
(4) P Ramanatha Aiyar's The Law Lexicon, The Encyclopaedic
Law Dictionary, Fourth Edition, Page-1489 :-
“Principal-One who employs another to act for him subject to his
general control and instruction; the person from whom an agent's
responsibility is derived; 'Principal' means highest in rank,
authority, character, importance, or degree; most considerable or
important; chief; main (as) the principal officers of a government,
the principal men of a state, the principal productions of a country,
the principal arguments in a case.”
Meaning of “Permanent”
(1) P Ramanatha Aiyar's The Law Lexicon, The Encyclopaedic
Law Dictionary, Fourth Edition, Page-1412 :-
“Permanent-'Permanent' is defined to mean not temporary, or
subject to change; abiding, remaining fixed, or enduring in
character, state or place; the meaning of the word 'permanent'
according to the lexicographers, is continuing in the same state, or
Special Appeal No.1481 of 2007
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without any change that destroys form or character,remaining
unaltered or unremoved, abiding, durable, fixed, lasting, continuing;
as a permanent impression, permanent institution”
(2) Collins Cobuild Advanced Learner's English Dictionary,
Fourth Edition, Page-1067 :-
“Permanent-something that is permanent lasts for ever;
'permanent' is used to describe situations or states that keep
occurring or which seems to exist all the time; used especially to
describe problems or difficulties.”
(emphasis added)
106. We admit no doubt in our mind that 'Principal Seat' of High Court
of Judicature at Allahabad is at Allahabad but to buttress, it we may notice
a few indications to fortify our views as under :-
(I) The appointments of Judges are made in the High Court of
Judicature at Allahabad. After taking oath, without any order of
Chief Justice, subject to determination/roster, they sit and hold
Courts at Allahabad. For this purpose, neither any nomination is
required, nor any order of Chief Justice is required, but for sitting at
Lucknow a nomination through notification is made by Chief
Justice and thereafter a Judge, who has taken oath as Judge of this
Court, may sit and hold Court at Lucknow. Therefore, with
appointment, authority to hold Court at Allahabad is implicit, but
sitting at Lucknow requires a nomination by Chief Justice.
(II) In certain cases, where Chief Justice pass order, cases, may be
transferred from Lucknow to Allahabad for hearing, but not vice
versa. Therefore, Judges sitting at Allahabad may hear cases which
were entertained by Judges sitting at Lucknow, since, cause of
action had arisen within the area which has been decided by the
Chief Justice to be entertained by the Judges sitting at Lucknow, but
cases which relates to other parts of State of U. P. and have been
entertained at Allahabad, cannot be heard at Lucknow, since no
power of transfer of such cases is conferred upon Chief Justice. We
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do not find any otherwise provision for such transfer of cases.
(III) Administrative control is also broadly in the Secretariat of High
Court i.e. Registrar General at Allahabad, which governs entire
State of U. P.
(IV) When new High Court was constituted, Chief Justice of High
Court at Allahabad was given status of “Chief Justice” of “New
High Court” while “Chief Judge” of “Chief Court of Oudh” became
a “Puisne Judge”, though senior-most among Puisne Judges. This
also shows difference in status of two places, which was conceived
even by U. P. High Courts (Amalgamation) Order, 1948.
107.We, therefore, have no hesitation in holding that the question,
whether seat at Allahabad is 'permanent' or not, stands answered by
decision in Sri Nasiruddin (supra) and it cannot be said that Allahabad,
as per provisions of U. P. High Courts (Amalgamation) Order, 1948 is a
'Permanent Seat' of this Court, but it cannot be doubted that seat at
Allahabad is 'Principal Seat' of “New High Court” which came into
existence as a result of amalgamation, under U. P. High Courts
(Amalgamation) Order, 1948.
108.To bring the facts straight, we may also notice that now “New High
Court” as it was under the provisions of U. P. High Courts
(Amalgamation) Order, 1948, has been declared again as 'High Court of
Judicature at Allahabad' as High Court for State of U. P. vide Section 26 of
Uttar Pradesh Reorganisation Act, 2000 (hereinafter referred to as “Act,
2000”), which reads as under :
“26. High Court of Uttranchal.-(1) As from the appointed
day, there shall be a separate High Court for the State of
Uttaranchal (hereinafter referred to as “the High Court of
Uttaranchal”) and the High Court of Judicature at
Allahabad shall become the High Court for the State of
Uttar Pradesh (hereinafter referred to as the High Court at
Allahabad).”
Special Appeal No.1481 of 2007
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(emphasis added)
109.Under Section 3 of Act 2000 from the “appointed day” i.e. 9
th
October, 2000, State of Uttar Pradesh comprised of territories other than
those specified in Section 3 of aforesaid Act.
110.Thus, Supreme Court in Sri Nasiruddin (supra) did not approve
findings of this Court that the area of jurisdiction of Judges sitting at
Lucknow may be decreased by Chief Justice under First Proviso of
Article/Clause 14 of U. P. High Courts (Amalgamation) Order, 1948. It
held that First Proviso to Article/Clause 14 of U. P. High Courts
(Amalgamation) Order, 1948 shows that there is limitation on the number
of Judges with regard to minimum that it shall not be less than two.
Beyond that, number can be increased or decreased according to the
exigencies and consequently Judges may come from Allahabad to
Lucknow or vice versa from time to time. The words “from time to time”
apply only to Judges required to be nominated by Chief Justice to sit at
Lucknow and not connected with “such areas of Oudh as the Chief Justice
may direct”. Supreme Court said that in respect of areas, power of Chief
Justice is liable to be exercised only once, and once that power is
exercised, it is exhausted. Relevant extract of Judgment reads as under :
“The words “as the Chief Justice may direct” mean that the
Chief Justice exercises the power to direct what the areas in
Oudh are for exercise of jurisdiction by Judges at Lucknow
Bench. Once that power is exercised, it is exhausted. The
reason is that the areas once determined should hold good
on account of certainty and to dispel problems being
created from time to time by increase or decrease of
areas.”
(emphasis added)
111.Court also held in para 33 with reference to Article/Clause 7 of U. P.
High Courts (Amalgamation) Order, 1948 that thereunder “New High
Court” has jurisdiction in respect of whole province. Article/Clause 14
deals with seats of High Court at Allahabad and Lucknow. It is only First
Special Appeal No.1481 of 2007
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Proviso to Article/Clause 14 of Order, 1948, which provides that unless
Governor with concurrence of Chief Justice directs otherwise not less than
two Judges shall sit at Lucknow in order to exercise in respect of cases
arising in such areas at Oudh/Avadh, the jurisdiction and power vested in
the “New High Court”. Then Court further said as under :
“The first proviso to paragraph 14 of the Order specifies the
instrumentality through which the jurisdiction vested in the
new High Court will be exercised in respect of cases arising
in Oudh. The direction which the Chief Justice has given
once with regard to the areas in Oudh remains unaltered.”
(emphasis added)
112.Supreme Court also said that for exercise of power with respect to
territorial jurisdiction in the matters to be taken by Judges sitting at
Lucknow, first part of Section 14 of General Clauses Act, 1897
(hereinafter referred to as “Act, 1897”) shall have no application and
second part of first proviso of Article/Clause 14 of U. P. High Courts
(Amalgamation) Order, 1948 shows that power therein is not to be
exercised from time to time but only once. Relevant observations read as
under :
“The second part of the first proviso to paragraph 14 shows
that such areas in Oudh as the Chief Justice may direct are
areas in respect of which once such direction is given, there
is no intention in the Order to exercise such power of
direction from time to time.”
(emphasis added)
113.Supreme Court, therefore, reversed findings of this Court that areas
in Oudh/Avadh can be increased or decreased by Chief Justice from time
to time. Court said that it is only if Lucknow ceased to be the seat of High
Court when otherwise direction is given by Governor in concurrence with
the Chief Justice as provided in first proviso to Article/Clause 14 of U. P.
High Courts (Amalgamation) Order, 1948 with regard to sitting of Judges
at Lucknow and exercising jurisdiction in respect of cases arising in areas
Special Appeal No.1481 of 2007
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in Oudh/Avdah, only then the direction of Chief Justice with regard to
determination of area would cease to have any significance in relation to
Lucknow, otherwise once such decision is taken or direction issued, it
stands exhausted and thereafter area brought within the jurisdiction of
Judges sitting at Lucknow cannot be changed i.e. neither increased nor
decreased.
114.Judgment in Sri Nasiruddin (supra) has also settled law that area
determined by Chief Justice in respect whereof the matter shall be taken
by Judges sitting at Lucknow, would remain unchanged, either way, if
once such exercise of determination has been exhausted by Chief Justice,
as this power cannot be exercised repeatedly. Therefore, whatever area
which has already been assigned by Chief Justice to be entertained by
Judges sitting at Lucknow, that has become final, and neither such area
can be increased nor decreased, unless some decision is taken to change
the place Lucknow itself by Governor in consultation of Chief Justice to
make the place of sitting elsewhere.
115.The third finding of larger Bench in Sri Nirmal Das Khaturia
(supra) that the place of filing application under Article 226 will be
decided in the context of right of petitioner first, and if it is within area of
Oudh/Avadh then it can be filed at Lucknow otherwise at Allahabad, has
also been reversed by Supreme Court. It has held if cause of action arose
because of appellate order or revisional order which came to be passed at
Lucknow, then Lucknow would have jurisdiction though original order
was passed at a place outside the areas in Oudh/Avadh. Supreme Court,
therefore, has summarized its conclusions in respect of above findings of
Larger Bench of this Court, which have been reversed, as under :
“(1) There is no permanent seat of High Court at
Allahabad. Seats at Allahabad and at Lucknow may be
changed in accordance with the provisions of the Order.
(2) Chief Justice has no power to increase or decrease the
areas in Oudh from time to time. The areas in Oudh have
Special Appeal No.1481 of 2007
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been determined once by the Chief Justice, then there is no
scope for changing the area thereafter.
(3) Chief Justice has power under second proviso to Clause
14 of Order 1948 to direct that any case or class of cases
arising in Oudh areas shall be heard at Allahabad. The
word “heard” means that cases which have already been
instituted or filed at Lucknow may in the discretion of the
Chief Justice be directed to be heard at Allahabad. The
cases which are yet to be filed and have jurisdiction before
Judges sitting at Lucknow in respect thereof power under
second proviso to Clause 14 of Order 1948, cannot be
exercised by Chief Justice.
(4) If cause of action wholly or partly has arisen within
Oudh area, then Lucknow Bench will have jurisdiction.
Where cause of action in part has arisen in specified Oudh
areas and part outside the Oudh area, it will be open to
litigant to frame the case appropriately to attract the
jurisdiction either at Lucknow or at Allahabad.
(5) A criminal case arose when offence has been committed
or otherwise has been provided in Cr.P.C. that will attract
jurisdiction of Court at Allahad and Lucknow in some cases
depending on the facts and provisions regarding
jurisdiction. It may arise in either place.”
(emphasis added)
116.Subject to above directions and reversing findings of this Court,
Supreme Court held that answers given to first three questions are correct,
but answer given to fourth question was set aside and answer given to
fifth question was discharged.
117.The aforesaid historical backdrop, therefore, makes it clear that
High Court at Allahabad was created by Royal Charter. Initially it was
called as 'High Court of Judicature for North Western Provinces' which
had the area of aforesaid Province but Oudh was a different Province, not
governed by North Western Provinces. 'High Court of Judicature for North
Western Provinces' subsequently became 'High Court of Judicature at
Allahabad'. Judicial system at Province in Oudh area came to be governed
Special Appeal No.1481 of 2007
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by British system of justice after Oudh area was acceded to by Britishers
(East India Company) in 1856. Judicial system for Oudh area was
governed by Statute governing judicial system in Oudh, then changed by
various statutes and commencing from Act No.XIV of 1865 abd followed
by Act No.XXXII of 1871 i.e. 'Oudh Civil Courts Act' and subsequent
Statutes enacted thereafter. In 1925 vide Oudh Courts Act, a Chief Court
for Oudh was constituted consisting of one Chief Judge and four Puisne
Judges. They continued till U. P. High Courts (Amalgamation) Order,
1948 was enacted amalgamating both Courts at Lucknow and Allahabad
in one High Court called as 'High Court of Judicature at Allahabad'.
Though Government of India Acts were enacted from time to time and
first one, being Government of India Act, 1800, was enacted with further
Regulations for establishing British domain in India and better
administration of justice within the same, but Chartered High Courts
established under the provisions of Indian High Courts Act, 1861 came to
be governed together for the first time by Government of India Act, 1919
i.e. 1915-1919 and Section 101 thereof provided that High Courts referred
to in the said Act are such which were established in British India by
Letters Patent.
118.By Section 130 of G.I. Act, 1915-1919, Acts specified in Fourth
Schedule were repealed and Indian High Courts Act, 1861 and Indian
High Courts Act, 1865 in entirety were repealed. The G.I. Act, 1915-1919
obviously did not cover Judicial Commissioner's Court for Oudh
Province.
119.However for the first time, G. I. Act, 1935 while declaring as to
which Court shall be deemed to be High Courts for the purpose of G. I.
Act, 1935, declared, besides others, existing High Courts, to include Chief
Court of Oudh also. This status conferred upon Chief Court of Oudh as a
'High Court' came to be recognized vide U. P. High Courts
(Amalgamation) Order, 1948 wherein Chief Court of Oudh at Lucknow
and High Court of Judicature at Allahabad, both were termed as 'existing
Special Appeal No.1481 of 2007
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High Courts' and on amalgamation gave rise to a New High Court i.e.
'High Court of Judicature at Allahabad'. However, Chief Justice of
Allahabad High Court became Chief Justice of New High Court and Chief
Judge of Avadh/Oudh became one of the Judges though as per his priority,
he was placed above other Puisne Judges of High Court of Judicature at
Allahabad. Superintendence of New High Court by Chief Justice, who
was sitting at Allahabad at that time, continued with him.
120.The entire discussions made above at the pain of repetition leads an
undoubted inference that New High Court created by U. P. High Courts
(Amalgamation) Order, 1948 did not declare any 'Permanent Seat' of New
High Court, but considering the fact that Chief Justice of High Court of
Judicature at Allahabad i.e. existing High Court became Chief Justice of
New High Court also, we have no manner of doubt to observe that
'Principal Seat of Allahabad remained at Allahabad'. This is also evident
from the fact that the number of Judges to sit at Lucknow would not be
less than two but how much beyond that, has to be decided by Chief
Justice. All other judges would sit at Allahabad. Similarly, territorial
jurisdiction of New High Court at Lucknow is subject to determination of
Chief Justice, which power could have been exercised for once. In respect
of remaining areas, jurisdiction remained with New High Court at
Allahabad. Further in a pending case, Chief Justice may transfer the
matter for hearing to Allahabad but not vice versa. This shows that High
Court at Allahabad has residuary authority. It can hear matters within
jurisdiction of Judges sitting at Lucknow but not vice versa. All this go to
show that New High Court at Allahabad can be termed as “Principal Seat”
of High Court.
121.Question (1) therefore, is answered by holding that Allahabad or
Lucknow cannot be said to be a “Permanent Seat” of High Court and no
such permanence in respect of seat has been visualized or provided by
U.P. High Courts (Amalgamation) Order, 1948 as held by Constitution
Bench in Sri Nasiruddin (supra) but “Principal Seat” of 'High Court of
Special Appeal No.1481 of 2007
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Judicature at Allahabad' is at 'Allahabad'.
122.Now coming to the second question with regard to jurisdiction
conferred in respect of 'Company Judge', we find that certain Notifications
under Article/Clause 14 have been issued in exercise of powers under U.
P. High Courts (Amalgamation) Order, 1948 and relevant Notifications are
dated 26.07.1948, 15.07.1949, 02.07.1954, 05.08.1975, 04.01.2003 and
14.01.2003.
123.The earliest order passed by Chief Justice in purported exercise of
power under Article/Clause 9 of U. P. High Courts (Amalgamation) Order,
1948 is Notification dated 26.07.1948 and it reads as under :
“In exercise of the powers conferred by Article 9 of the
United Provinces High Courts (Amalgamation) Order, 1948,
the Chief Justice of the High Court of Judicature at
Allahabad is pleased to direct that as from the 26
th
of July,
1948, until further orders, the following provisions of the
rules of the Chief Court of Avadh at Lucknow and
Appendices shall apply in relation to the Bench at
Lucknow in supersession of the rules of the High Court of
Judicature at Allahabad governing the matters covered by
these provisions subject to the modifications hereinafter
mentioned :
The whole of Chapter IV.
The whole of Chapter V.
The whole of Chapter VI.
The whole of Chapter VII.
The whole of Chapter IX.
Rules 7, 10, 111 and 12 of Chapter XII.
Rule 2 (e) of Chapter XIII.
The whole of Chapter XVI.
The whole of Chapter XVII.
Rules 1 to 9 of Chapter XVIII.
Rule 7 of Chapter XX.
The whole of Chapter XXII.
Special Appeal No.1481 of 2007
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The whole of Chapter XXIII.
Appendices 12 and 13.
Rules made under the Indian Companies Act (VII of 1913)
Modifications -
1. References to the Chief Judge in these provisions shall be
construed as references to the senior Judge at Lucknow.
2. References to the Registrar in those provisions shall
include references to the Deputy Registrar at Lucknow.”
(emphasis added)
124.Another Notification is dated 15.07.1949 which was issued in
purported exercise of power under Article/Clause 14 of U. P. High Courts
(Amalgamation) Order, 1948 and it reads as under :-
“No.8427/Ib-39-49.-In exercise of the powers conferred by
Article 14 of the United Provinces High Courts
(Amalgamation) Order, 1948, and in partial modification of
the Court's notification no.6103, dated July 26, 1948, as
amended up-to-date, the Chief Justice of the High Court of
Judicature at Allahabad is pleased to direct that with effect
from July 25, 1949, the Lucknow Bench of the High Court
of Judicature at Allahabad shall not exercise jurisdiction
and power in respect of cases under the following Acts
arising within its existing territorial jurisdiction :
(1) The Indian Divorce Act, 1869 (Act IV of 1869).
(2) The Special Marriage Act, 1872 (Act III of 1872).
(3) The Indian Companies Act, 1913 (Act VII of 1913).
(4) The Indian Income-tax Act, 1922 (Act XI of 1922).
(5) The Indian Succession Act, 1925 (Act XXXIX of 1925)
(6) The Indian Matrimonial Causes (War Marriages) Act,
1948 (Act no.XL of 1948) :
Provided that nothing herein contained shall affect
the jurisdiction and power of the Lucknow Bench in
respect of proceedings already pending before that Bench
prior to the coming into force of this notification.”
(emphasis added)
Special Appeal No.1481 of 2007
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125.Then comes Notification dated 02.07.1954 which was also issued in
purported exercise of power under Article/Clause 14 of U. P. High Courts
(Amalgamation) Order, 1948 and reads as under :
“No.6984/Ib-39.-In exercise of the powers conferred by
Article 14 of the U. P. High Courts (Amalgamation) Order,
1948 and in supersession of the Court's notification
no.8427/Ib-39-49, dated July 15, 1949, the Chief Justice of
the High Court of Judicature at Allahabad is pleased to
direct that with effect from July 10, 1954, the Lucknow
Bench of the High Court of Judicature at Allahabad shall
exercise jurisdiction and power in respect of cases under the
following Acts arising within its existing territorial
jurisdiction :
(1) The Indian Divorce Act, 1869 (Act IV of 1869).
(2) The Special Marriage Act, 1872 (Act III of 1872).
(3) The Indian Succession Act, 1925 (Act XXXIX of 1925).
(4) The Indian Matrimonial Causes (War Marriages) Act,
1948 (Act XL of 1948).
Jurisdiction and power in respect of cases under the
Indian Companies Act, 1913 (Act VII of 1913) and the
Indian Income tax Act, 1922 (Act XI of 1922) shall be
exercised by the Allahabad Bench of the Court.
Provided that nothing herein contained shall affect
the jurisdiction and power of the High Court at Allahabad
in respect of proceedings already pending before it prior to
the coming into force of this notification.”
(emphasis added)
126.In respect of company matters jurisdiction conferred upon Judges
sitting at Lucknow by Notification dated 15.07.1949 was taken away by
Notification dated 02.07.1954. This situation continued upto 04.08.1975.
127.A deviation was made by Notification dated 05.08.1975 and thereby
jurisdiction was again given to Judges sitting at Lucknow in the matter of
Act, 1956. To entertain winding up petitions i.e. upto the stage of
Special Appeal No.1481 of 2007
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proceedings under Section 439 of Act, 1956 jurisdiction was given to
Judges sitting at Lucknow but it was clearly provided that subsequent
proceedings will be heard at Allahabad. Notification dated 05.08.1975
reads as under :
“WHEREAS by notification No.8427/Ib-39-49.-dated the
15
th
of July, 1949, the Lucknow Bench fo the High Court of
Judicature at Allahabad was not to exercise the jurisdiction
and power of the High Court in respect of cases arising in
the areas of erstwhile Oudh under the following Acts and
those cases were to the heard at Allahabad.
(1) The Indian Divorce Act, 1869 (Act IV of 1869).
(2) The Special Marriage Act, 1872 (Act III of 1872).
(3) The Indian Succession Act, 1925 (Act XXXIX of 1925)
(4)The Indian Matrimonial Causes (War Marriages) Act,
1948 (Act no.XL of 1948) :
(5) The Indian Companies Act, 1913 (Act VII of 1913).
(6) The Indian Income-tax Act, 1922 (Act XI of 1922).
AND WHEREAS by the subsequent notification
No.6984/Ib-39.-dated the 2
nd
of July, 1954, the Lucknow
Bench of the High Court of Judicature at Allahabad was to
exercise the jurisdiction and power of the High Court in
respect of the cases under the following acts arising in the
areas of erstwhile Oudh :
(1) The Indian Divorce Act, 1869 (Act IV of 1869).
(2) The Special Marriage Act, 1872 (Act III of 1872).
(3) The Indian Succession Act, 1925 (Act XXXIX of 1925).
(4) The Indian Matrimonial Causes (War Marriages) Act,
1948.
and the cases under the Indian Companies Act, 1913 (Act
VII of 1913) and Indian Income Tax Act, 1922 (Act XI of
1922) arising in the areas of erstwhile Oudh continued to be
heard and decided at Allahabad and the Lucknow Bench
was not to exercise jurisdiction and power of the High
Court in respect to these class of cases.
AND WHEREAS it is desirable that the Lucknow
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Bench of the High Court of Judicature at Allahabad
should exercise the jurisdiction and power of the High
Court in respect of cases under the Income-Tax Act, 1961
and under the Companies Act, 1956 upto the stage of
winding up arising within the area of erstwhile Oudh.
NOW THEREFORE, in exercise of the powers
conferred by Clause 14 of the U. P. High Court
(Amalgamation) Order, 1948 and in supersession of the
notifications No.8427/Ib-39-49 dated July 15, 1949 and
No.6984/Ib-39 dated July 2, 1954, the Hon'ble the Chief
Justice of the High Court of Judicature at Allahabad is
pleased to direct that with effect from 1
st
October, 1975, the
Lucknow Bench of the High Court of Judicature at
Allahabad shall exercise the jurisdiction and power of the
High Court in respect of the cases under the following Acts
arising in the areas of erstwhile Oudh :
1. The Income Tax Act, 1961 (Act No.XLIII of 1961)
2. The Companies Act, 1956 (Act No.1 of 1956) upto the
stage of winding up i.e. upto the stage of proceedings
under Section 439 Companies Act, 1956.
PROVIDED that after the winding up order is
passed the subsequent proceedings will be heard at
Allahabad.
PROVIDED FURTHER that all proceedings under
the above Acts instituted or commenced before the date of
enforcement of this notification, shall continue to be heard
at Allahabad.
PROVIDED FUTHER that this notification shall not
affect the operation of notification No.5877/Ib-39, dated
April 18, 1973 and notifications dated May 1, 1973 and
December 21, 1974 which shall continue to remain in
force.”
(emphasis added)
128.Thus, vide Notification dated 05.08.1975, Chief Justice restored
jurisdiction to Judges sitting at Lucknow to entertain winding up matters
under Act, 1956 upto the stage of proceedings under Section 439, but
thereafter subsequent proceedings will have to be heard at Allahabad.
Special Appeal No.1481 of 2007
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129.A Division Bench of this Court in Sumac International Limited v.
M/s PNB Capital Services Ltd, AIR 1997 Allahabad 424 decided on 2
nd
July, 1997, held that institution of winding up petition of a company
having its registered office within territorial jurisdiction of Judges sitting
at Lucknow, at Allahabad is valid, since Judges sitting at Lucknow have
no jurisdiction in view of Notification dated 15.07.1949. Apparently,
Court did not consider that by Notification dated 05.08.1975 earlier
Notification dated 15.07.1949 and 02.07.1954 were modified to the extent
that winding up petition under Act, 1956 upto the stage of proceedings
under Section 439 would lie at Lucknow where registered office is within
jurisdiction of Judges sitting at Lucknow and ignoring Notification dated
05.08.1975 aforesaid judgment was given.
130.Apparently, the Division Bench in Sumac International Ltd
(supra) was in ignorance of Notification dated 05.08.1975 and did not lay
down a correct law. It was clearly a judgment per-incuriam.
131. Be that as it may. The fact remains that judgment operated and
consequential order was issued by Chief Justice on 04.01.2003 to the
following effect :
“2. Taking into consideration the judgment rendered by a
Division Bench of this court in the case of Sumac
International Ltd. Vs. P.N.B. Capital Services Ltd. decided
on July 2, 1997 reported in 1998 Company Cases Vol.93
page 236 as well as the judgement of this court rendered by
another Division Bench in the case of Smt. Padmawati Vs.
the Official Liquidator (Special Appeal No.7 of 1979)
connected with the case of Sri Jugal Kishore Vs. Official
Liquidator dated 24.9.1982, which have since attained
finality, specially the observations made therein, the position
in regard to the exercise of jurisdiction, entertainment and
disposal of the matters falling within the ambit of the
Companies Act as enforced w.e.f. 25
th
July, 1949 shall stand
restored in supersession of the intervening orders covering
the subject passed thereafter.”
132.Immediately thereafter it was brought to the notice of Chief Justice
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that Notification dated 05.08.1975 conferred jurisdiction upon Judges
sitting at Lucknow in the matter of Act, 1956, particularly winding up
petition upto the proceedings under Section 439 of said Act.
Consequently, another order was passed by Chief Justice on 14.01.2003 to
the following effect :
“Since the order dated 5
th
August 1975 passed by the
Hon'ble Chief Justice in exercise of powers conferred by
clause 14 of the U. P. High Court (Amalgamation) Order,
1948, in supersession of the notification dated 15
th
July,
1949, had not been brought to my notice it will be
appropriate that the order dated 4.1.2003 is suitable
modified.
Accordingly it is directed that the dated 25
th
July,
1949 occurring in paragraph 2 of the order dated 4.1.2003
be deleted and substituted by “1 October, 1975”.”
133.Though judgment in Sumac International Ltd. (supra) operated
the field and it was acted upon by Chief Justice also by issuing
Notification dated 04.01.2003, but within ten days when mistake was
brought to notice of Chief Justice, it was rectified, and revised
Notification was issued on 14.01.2003. The legal position however, it
appears remains slightly truncated for the reason that there was a verdict
holding that Judges sitting at Lucknow shall have no jurisdiction in
companies matters and there was notification of Chief Justice conferring
such power upon Judges sitting at Lucknow. This contradiction was
noticed by a learned Single Judge in Registrar of Companies Vs. M/s
Kamal Infosys Ltd. (supra), hence, following question was referred to
be answered by larger Bench :
“Whether this company petition filed for winding up of the
company M/s Kamal INFOSYS Ltd., respondent No.1
having its registered office at Lucknow is maintainable in
the High Court at Allahabad.”
134.A Division Bench considered all the aforesaid notifications and then
held that since judgment in Sumac International Ltd. Vs. P.N.B. Capital
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Services Ltd. (supra) was rendered in ignorance of Notification dated
05.08.1975, the said judgment is per-incuriam. It also held that in
company matters such Court has jurisdiction in whose territorial
jurisdiction company has its registered office. It, therefore, directed that
petition shall be returned to be presented at Lucknow Bench, holding that
petition at Allahabad is not maintainable, since, registered office of
Company is situate within territorial jurisdiction of Judges sitting at
Lucknow i.e. Lucknow Bench. Court also examined issue whether it is a
mere technical aspect or not and held that question is of jurisdiction and
order passed without jurisdiction, is a nullity. Therefore, applying
principle of Order VII Rule 10 C.P.C., Court said that the petition must be
returned so that it may be presented in the Court having jurisdiction in the
matter.
135.Thereafter again this issue came up in the context of same company
namely Sumac International Ltd. vs. M/s P.N.B. Capital Services Ltd.
and another, 2006 (1) ADJ 86 (DB). Therein Court was examining
correctness of order dated 31.03.2006 whereby learned Company Judge
sitting at Allahabad had directed for winding up of Company and by order
dated 17.10.2006, recall application of winding up order was rejected.
Both these orders were held, in intra Court appeal heard by a Division
Bench in M/s Sumac International Ltd. (supra), as without jurisdiction.
In para 3 of judgment, referring to Supreme Court's judgment in Sri
Nasiruddin (supra), Court said that Lucknow Bench has exclusive
jurisdiction with regard to cases which arise in respect of places, which
were part of erstwhile Avadh/Oudh. Division Bench categorically said that
despite earlier Division Bench judgment in Sumac International Ltd
(supra) i.e. AIR 1997 Allahabad 424, Court cannot take an otherwise
stand when it is clear that Allahabad Seat does not have jurisdiction in the
matter. It held that on the point of jurisdiction, there cannot be any res
judicata. It also held that an order without jurisdiction is valid only for
parties, who choose to treat it as valid, but otherwise such order can be
Special Appeal No.1481 of 2007
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disregarded by parties, and therefore, even more so by Court, before
which such orders come to be considered and applied at later times. Court
in paras 25 and 26 of Judgment said as under :
“25. In the manner we respectfully read the said judgment
and the said observations of the highest persuasive
authorities, we feel that the rule still is that an order without
jurisdiction is so void that a party can at almost all times
disregard at his choice, and that the party might also wait,
but that the safer course in any event is to have the order
without jurisdiction set aside, or pronounced to be so, as
early as possible, which is the course which the pragmatic
appellant has taken in this case.
26. The appeal is allowed. The two orders under appeal are
both set aside. The winding up petition is consigned to the
department with liberty to the petitioning creditor to take
steps in regard thereto in accordance with law as it might be
advised.”
136.Since jurisdiction of cases which can be entertained at Lucknow and
Allahabad are governed by Article/Clause 14 of U. P. High Courts
(Amalgamation) Order 1948, considering the same, in para 11 of
judgment in Dr. Manju Verma (supra), Supreme Court said :
“the Benches of Lucknow and Allahabad although part of
one High Court, exercise distinct and exclusive jurisdiction
over demarcated territories.”
(emphasis added)
137.If part of the cause of action had arisen within the territorial
jurisdiction of both i.e. Lucknow and Allahabad, litigant has choice to
invoke jurisdiction at one of the two places.
138.Sri Navin Sinha, learned Senior Counsel appearing for appellant has
placed reliance on Supreme Court judgment in Dr. Manju Verma
(supra), but we find that except observations made in para 11 of the
judgment, otherwise issue in the said case was different. The broad
question up for consideration in Dr. Manju Verma (supra) was “whether
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an order passed under Article/Clause 14 of U. P. High Courts
(Amalgamation) Order, 1948 for transferring a case from Lucknow to
Allahabad is a quasi-judicial order and Chief Justice exercises quasi-
judicial power or not”. Considering the manner in which Chief Justice
passed order of transfer after hearing parties, Court held that order was
quasi-judicial. In para 19 of the judgment Court said as under : :
“19. In ordering the transfer of the case under the 1948
Amalgamation Order, the Chief Justice was determining the
plea of the respondent and the objection of the appellant to
the transfer of the appellant's writ petition. He could not
allow the plea without hearing the affected party and
without determining on objective criteria and upon
investigation whether the case was (a) transferable, and (b)
should be transferred. His decision would affect the right of
the appellant to choose her “forum convenients”. He was,
therefore, acting as an adjudicating body empowered by the
Constitution to discharge judicial functions. We would
accordingly hold that the Chief Justice while exercising
jurisdiction under para 14 of the 1948 Order, acts as a
judicial authority with all the attributes of a court...”
(emphasis added)
139.In para 21 of the judgment, Court also said that the power of
transfer from Lucknow to Allahabad will arise where judges at Lucknow
have jurisdiction, and further, power will be exercised for 'hearing' the
matter at Allahabad, but if the matter has already been 'heard', then
Article/Clause 14 of U. P. High Courts (Amalgamation) Order, 1948
giving power to transfer a case from Lucknow to Allahabad will not be
available. Relevant observations are as under :
“The proviso assumes first, that the case or class of cases to
be transferred by the Chief Justice from Lucknow to
Allahabad are those which the Lucknow Bench would
otherwise have the jurisdiction to entertain; and second that
the power of transfer must be exercised for the purpose of
having the matter heard at Allahabad. If the matter has
already been heard, then the Chief Justice would not have
Special Appeal No.1481 of 2007
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power to transfer the case from Lucknow to Allahabad.”
140.In the present case, this issue is not at all involved, hence, we do not
find that judgment in Dr. Manju Verma (supra) takes us any further on
the question with which we are concerned. We, therefore, answer question
(2) holding that since jurisdiction of cases to be entertained at Lucknow
and Allahabad are distinct and exclusive over demarcated territories, it
renders an order passed by Judges sitting at a place in a matter over which
they have no jurisdiction, as nullity.
141.In this very context and answering question (2), we think that even
question (3) can be considered simultaneously as to whether objection as
to territorial jurisdiction can be raised after a long time i.e. after eight
years in the case in hand, and whether appellant's objection should be
declined by applying principle of Section 21 C.P.C. that such objection
was not raised earlier.
142.In our view, this aspect can be considered in the light of law laid
down in Harshad Chiman Lal Modi vs. DLF Universal Ltd. (2005)
7SCC 791. An agreement was entered between Harshad Chiman Lal
Modi (hereinafter referred to as “Buyer”) and DLF Universal Ltd.
(hereinafter referred to as “Builder”) for purchase of a residential plot at
residential colony, DLF Qutub Enclave Complex, Gudgaon, Haryana.
Head Office of Builder was at Delhi. Agreement was executed at Delhi
and payments were also made at Delhi. Though Buyer claimed that he has
made payments as per agreement, but Builder disputed the same and
cancelled agreement. This led to filing of Suit No.3095 of 1988 by the
Buyer in Delhi High Court for declaration, specific performance of
agreement, possession of property and permanent injunction. Entertaining
the Suit on 09.12.1988, a Single Judge of Delhi High Court granted
interim injunction. In written statement filed by Builder on 29.03.1989,
though claim on merit was objected, but jurisdiction of Delhi High Court
was admitted in paras 18 and 19. Later, due to change of pecuniary
jurisdiction, suit was transferred to District Court on 12.07.1993. On
Special Appeal No.1481 of 2007
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17.02.1997, District Court framed issues but no issue with regard to
territorial jurisdiction was framed, since, there was no dispute between
parties. It is only on 22.08.1997 i.e. after more than eight years of filing
of written statement, Builder filed an application under Order 6 Rule 17
C.P.C. seeking amendment in the written statement by raising objection
with regard to jurisdiction of Delhi Court and claimed that since property
in dispute situate in Gudgaon District, State of Haryana, therefore, vide
Section 16 C.P.C., suit for recovery of property could be instituted within
local jurisdiction where disputed property situated and Delhi Court had no
jurisdiction. Amendment was allowed and Trial Court framed an issue on
the question of territorial jurisdiction. The issue of jurisdiction was
decided as a 'preliminary issue' in favour of Builder. It was challenged in
High Court, but failed thereat. Buyer thereafter brought matter in appeal
before Supreme Court. Court considered scheme of Sections 15 to 20
C.P.C. and observed that Section 16 C.P.C. recognizes well established
principle that actions against 'res' or 'property' should be brought in the
forum where such 'res' is situate. Court had no jurisdiction over a dispute
over which it cannot give an effective judgment. With respect to Section
20 C.P.C, Court said that it is a residuary provision and covers those cases,
not falling within the limitations of Sections 15 to 19 C.P.C. Court also
held that normally, if there is an agreement between parties regarding
territorial jurisdiction, such agreement can be enforced but not in cases
where Court has no jurisdiction at all. In other words, Court said that such
agreement can be implemented only when two or more Courts have
jurisdiction to try a suit or proceeding and parties decide and agreed for
jurisdiction to one of such Courts. Court referred to and relied on its
earlier judgment in Hakam Singh vs. Gammon (India) Limited, 1971
(1) SCC 286 wherein in para 4, Court said :-
“It is not open to the parties by agreement to confer by
their agreement jurisdiction on a court which it does not
possess under the Code. But where two courts or more have
under the Code of Civil Procedure jurisdiction to try a suit
Special Appeal No.1481 of 2007
-65-
or proceeding an agreement between the parties that the
dispute between them shall be tried in one of such courts is
not contrary to public policy. Such an agreement does not
contravene Section 28 of the Contract Act.”
(emphasis added)
143.Supreme Court said that parties cannot confer jurisdiction upon a
Court which otherwise has no jurisdiction and such agreement to that
extent would also be void being against public policy. Then considering
question of belated objection raised after eight years, Court said that
jurisdiction of Court is classified in several categories. The important
categories are, (i) territorial or local jurisdiction; (ii) pecuniary
jurisdiction; and (iii) jurisdiction over subject matter. Court further held
that so far as territorial and pecuniary jurisdiction are concerned,
objection to such jurisdiction has to be taken at the earliest possible
opportunity, and in any case, at or before settlement of issues. If such
objection is not taken at the earliest, it cannot be allowed to be taken at
later stage. The relevant observations of Court are as under :
“So far as territorial and pecuniary jurisdictions are
concerned, objection to such jurisdiction has to be taken at
the earliest possible opportunity and in any case at or before
settlement of issues. The law is well settled on the point that
if such objection is not taken at the earliest, it cannot be
allowed to be taken at a subsequent stage.”
144.Thereafter Court said that so far as jurisdiction of subject-matter is
concerned, it is totally distinct and stand on different footing. Where a
Court has no jurisdiction over subject-matter of suit by reason of any
limitation imposed by statute, charter or commission, it cannot take up the
cause or matter. An order passed by Court having no jurisdiction qua
subject matter, is a nullity. In para 32 of judgment, relying on its earlier
judgment in Bahrein Petroleum Company vs. P. J. Pappu, AIR 1966
SC 634, Court held :
“A decree passed by a court having no jurisdiction is non
est and its invalidity can be set up whenever it is sought to
Special Appeal No.1481 of 2007
-66-
be enforced as a foundation for a right, even at the stage of
execution or in collateral proceedings. A decree passed by a
court without jurisdiction is a coram non judice.”
(emphasis added)
145.When we look at aforesaid judgment and apply it to facts of present
case, on the one hand, it appears that it is a simple case of objection
relating to territorial jurisdiction, but we find that here objection is in
respect of subject-matter also. Cases relating to winding up, upto the stage
of Section 439 of Act, 1956, arisen in the area within jurisdiction of
Judges sitting at Lucknow, are not within jurisdiction of Judges at
Allahabad. Therefore, Judges sitting at Allahabad lack jurisdiction on
subject-matter also since, after proceeding under Section 439 of Act,
1956, Judges at Allahabad will have jurisdiction but not earlier thereto.
Therefore, winding up matter in the present case involves want of
jurisdiction on subject-matter also to Judges sitting at Allahabad, hence,
order under appeal, in our view, is without jurisdiction and cannot be
sustained. In such a situation, belated objection will make no effect.
146.Moreover, with respect to delay also, we find that appellant can not
be said to be a negligent and careless litigant outrightly. Reference was
made by BIFR on 23.04.1999 and received by Registrar General at
Allahabad on 03.05.1999. At that time, Division Bench judgment in
Sumac International Limited (supra) rendered on 02.07.1997 was
operating. Even Chief Justice, in the light of aforesaid judgment, issued a
notification on 04.01.2003, though it was rectified within ten days. The
issue still was not clear and came to be referred to a Larger Bench for
consideration, by a Single Judge in Registrar of Companies vs M/s
Kamal Infosys Limited (supra), which was decided on 14.03.2005. In
this backdrop, when things were not clear even on administrative or
judicial side, to blame appellant for delay in raising objection with regard
to jurisdiction, will not be just and appropriate, and we cannot non suit
Defaulting Company/Appellant for this reason.
Special Appeal No.1481 of 2007
-67-
147.We, therefore, answer questions (2) and (3) together holding that
objection of jurisdiction in the matter of winding up of company having
registered Office at a place which is within territorial jurisdiction of
Lucknow Bench, goes to the root of the matter and any order passed at
Allahabad, ignoring the above jurisdiction, is a nullity. Mere delay in
raising objection will not validate the order, since, such an order lacks
patent jurisdiction.
148.Now coming to question (4) i.e. last question, since we are setting
aside judgment under appeal passed by learned Single Judge, it will not be
apropriate to answer question (4), since it has to be seen afresh by
appropriate Court at Lucknow and, therefore, question (4) is discharged
unanswered.
149.In view of above discussions, it cannot be said that winding up
petition at Allahabad in respect of Defaulting Company/Appellant was
maintainable at Allahabad, since, registered office of Company is at A/2,
Site No.2, Industrial Area, Rae Bareli having its territorial jurisdiction
with Judges sitting at Lucknow. Therefore, order passed by learned Single
Judge for winding up of company at Allahabad, is patently without
jurisdiction.
150.Lastly, it has to be seen as to what ultimate order should be passed
since, order of winding up was not passed on a winding up petition, but it
is on a Reference made by BIFR. Here winding up proceedings have been
initiated not at the instance of an individual party but on a Reference made
by BIFR under Section 20 (1) of Act, 1985, which was received at
Allahabad. It was enjoined upon Registrar General to remit Reference to
Lucknow for further action, but, he committed mistake by placing it
before Company Judge at Allahabad. Thus appropriate order would be to
direct Registrar General to forward Reference received from BIFR to
Registrar at Lucknow for placing it before Company Judge sitting at
Lucknow for considering the matter of winding up of Defaulting
Company/Appellant and pass necessary order in accordance with law.
Special Appeal No.1481 of 2007
-68-
151.Appeal is, accordingly, allowed. Judgment dated 19.09.2007 passed
by Company Judge for winding up of Company and appointing Official
Liquidator, is hereby set aside. We direct Registrar General to forward
Reference received from BIFR to Registrar at Lucknow for placing it
before Company Judge sitting at Lucknow for considering the matter of
winding up of Defaulting Company/Appellant in accordance with law.
152.No costs.
Order Date : 17.10.2019
Manish Himwan
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