(1) This Election Petition relates to the election of a Member to the Mysore Legislative Assembly from the Hunsur Assembly Constituency, in the elections held on 15-2-1967. The respondent was declared duly elected by the Returning Officer on 21-2-1967.
(2) The petitioner and the respondent amongst others filed their nomination papers before Returning Officer in response to the Notification in the Official Gazette of Mysore dated 13-1-1967 calling for nominations. The nomination papers were scrutinised on 21-1-1967. The respondent raised objections to the nomination of the petitioner contending that the Public Works Department of the Government of Mysore in the course of his business as a licensed Public Works Department Contractor, and therefore was disqualified to stand for Elections to the Mysore Legislative Assembly. The Returning Officer, after giving an opportunity to the parties to adduce evidence in support of their respective contentions, rejected the nomination paper of the petitioner on 22-1-1967, under the provisions of Section 36 (2)(1) of the Representation of the People Act, 1951 (Hereinafter referred to as the Act), holding that on the date fixed for the scrutiny of the petitioner's nomination paper, the petitioner's contracts with the Government of Mysore subsist and he is therefore disqualified. The petitioner challenges this order of the Returning Officer as being erroneous inasmuch as on facts there were actually no subsisting contracts on the date of the scrutiny of the nomination papers.
(3) In the petition, the petitioner alleges that his contractual relationship with the Government as a contractor for the execution of the works undertaken by him had ceased to exist on the date of scrutiny. The petitioner submits that he had entered into agreements with the executive Engineer (K. R. Nagar Division, K. R. Nagar) of the Public Works Department of the Government of Mysore in 1961 for the construction of the Pravasi Mandir at Hunsur, the Government Girl's Urdu Middle School at Hunsur and Hostel and School buildings at Kakki Pikki Colony in Hunsur Taluk. It is alleged that the condition in the contracts was that the constructions of the above said buildings should be completed and handed over before 1962. It is submitted that due to the non-cooperation of the Public Works Department, the petitioner could not execute the works in time and the petitioner was treated as a defaulter and his contracts in respect of the works at Kakki Pikki Colony were cancelled and final measurements were also recorded and final bill prepared in February 1962 in respect of those works. It is further stated that the contract was renewed by the Superintending Engineer, Mysore Circle, on the petitioner's expressing his willingness to fulfill the contract if the Department were willing to co-operate fully with him. Thereafter, the petitioner took up the construction works again.
He further alleges that the authorities of the Public Works Department did not extend any help and co-operation to him in the execution of the works and he was prevented from showing any progress in the works. He wrote a letter on 8-7-1963 to the Executive Engineer, informing him that it was impossible for him to carry out further works and requesting him to pass orders for final bills being prepared in respect of the works already done and to arrange for the execution of the remaining works through other agencies. The Executive Engineer sent a reply dated 10-9-1963 asking the petitioner to contact the Assistant Engineer, No. 2 Sub-Division Hunsur to get the final claims on all the buildings settled. It is averred that in pursuance of this reply, the Assistant Engineer took steps to have final measurements.
From the conduct of the parties as above mentioned, the petitioner contends that the contractual relationship between him and the Public Works Department came to be terminated in 1963 itself. It is also incidentally mentioned that the petitioner has not renewed his licence as a Contractor from 1964-65. The petitioner also refers in his petition that notwithstanding the cessation of the contractual relationship between him and the Public Works Department, the authorities have been issuing notices to him stating that the contracts were still subsisting and that he would be held liable to his obligations under the contracts. A further allegation is made that the respondent who held office of a Minister prior to the 1967 Elections, was very influential and had prevailed upon the Public Works Department authorities to take the stand that they had taken in order to create evidence and bolster up the objections raised by him to the acceptance of the petitioner's nomination paper.
(4) On these allegations, the petitioner has filed the above Election Petition under Ss. 80 and 81 of the Act, praying that the order of the Returning Officer, rejecting the Petitioner's nomination paper for election as a Member of the Mysore Legislative Assembly from the Hunsur constituency at the 1967 General Elections be held to be irregular, illegal and improper and to declare that the election of the respondent to the Mysore Legislative Assembly from the Hunsur Assembly Constituency is void.
(5) It is to be further mentioned that in the petition a ground is also raised disputing the qualification of the respondent to stand as a candidate for the Elections to the Mysore Legislative Assembly. It is alleged that at time of filing his nomination paper, the respondent was the Chairman of the Mysore State Road Transport Corporation, Bangalore, (which is a statutory body) and this is an office of profit as contemplated under the law. For this reason it is stated that the respondent has incurred a disqualification for contesting the Elections under Article 191(1)(a) of the Constitution and therefore the acceptance of his nomination paper is invalid and renders is election to the Assembly void. During the course of arguments an attempt was made to rely on the provisions of S. 10 of the Act, under which a person who is a managing agent, manager or secretary of any corporation in the capital of which the Government has not less than twenty-five per cent share is disqualified. The ground in this case is that the capital of the Corporation of which the respondent is the Chairman is entirely of the State.
(6) The respondent denied the allegations of the petitioner and reiterated that the contractual relationship between the petitioner and the Government subsists. The respondent states that the contention of the petitioner that there was a cessation of all contractual relationship between the petitioner and the Public Works Department is not true. It is alleged that though it was open to the petitioner to have taken proper and adequate steps to legally terminate the contracts, he failed to do so and the final accounts between the parties have not been settled. The respondent also denied the allegation that he was in any way responsible for the various notices issued by the Public Works Department to the petitioner in respect of his contracts as alleged by him.
In view of the fact that according to the respondent the contractual relationship between the petitioner and the Public Works Department of the Government of Mysore subsists, it is alleged that the order of the Returning officer is in accordance with law and the facts pertaining to the case. The respondents has also denied that the Office he held as Chairman of the Mysore State Road Transport Corporation prior to 20-1-1967 is an office of profit and in any event he states that he having been accepted by the Government of Mysore on 20-1-1967, the order of the Returning Officer accepting his nomination paper is in accordance with law. The respondent, therefore, contends that the petitioner's application challenging the Election is liable to be dismissed with costs.
(7) On the basis of these pleadings, the following 4 issues were framed-
1. Does the petitioner prove that the contractual relationship between him and the Government was not subsisting on 21-1-1966, and that it had come to an end as early as in 1963 and therefore he was not disqualified to stand for election under S. 9A of the Representation of people Act of 1951? If so, is the election of the respondent to be declared void under S. 100 (1)(c) of the Representation of the People Act of 1951 on the ground that the nomination of the petitioner has been improperly rejected?
2. Does the Petitioner prove that at the time fixed for the scrutiny of the nomination papers the respondent was the Chairman of the Mysore State Road Transport Corporation, Bangalore, a statutory body and was holding an office of profit under the Government of Mysore and therefore was disqualified to be chosen as a member of the Mysore legislative Assembly, under Article 191 (1)(a) of the Constitution?
3. Does the respondent prove that he had submitted his resignation on 19-1-1967 and that the same was accepted by the Government of Mysore as per Notification dated 20th January 1967 and therefore on the date of scrutiny the respondent had ceased to be the Chairman of the Mysore Road Transport Corporation and that he was not disqualified under Art. 191(1)(a) of the Constitution?
4. To what relief is the Petitioner entitled?
(8) At the outset I shall record the submission of Sri B. T. Parthasarathy, the learned counsel for the petitioner, that he does not press the second issue and confines his arguments to the first issue only. In view of this stand taken by the learned counsel for the petitioner, the question as to whether the respondent was disqualified to be chosen as a Member of the Mysore Legislative Assembly under Art. 191(1)(a) of the Constitution or Section 10 of the Act does not arise for consideration.
(9) Consequently, the third issue also does not require to be considered.
(10) Therefore both the petitioner's counsel Sri. B. T. Parthasarathy and the Respondent's counsel Sri. M. P. Chandrakantaraj Urs have confined their arguments bearing only on the first issue.
(11) The petitioner examined himself and the respondent examined himself and one witness.
(12-19) (After reviewing the documentary evidence His Lordship proceeded.) From the correspondence referred to above, and the conduct of the parties borne out by such correspondence, it is established that the contractual relationship between the petitioner and the Government under Exhibits R-1, R-2, and R-3 was subsisting on 21-1-1967 and that it had not come to an end as early as in 1963 itself as pleaded by the petitioner. This finding would be enough to conclude that the Returning officer was correct in rejecting the nomination paper of the petitioner for reason that the petitioner was disqualified to stand for election by virtue of the provisions of S. 9A of the Act.
(20) Assuming that Exhibits P-1 and P-4 constitute a repudiation of the contracts by the petitioner on the one part and the acceptance of the same by the Public Works Department authorities on the other, resulting in the termination of the contracts as urged by the petitioner's counsel, the learned counsel for the respondent contends that by virtue of the determination of the contracts, the contracts themselves do not cease to subsist. According to the respondent's counsel a contract subsists until the rights and obligations of the contracting parties are finally settled with reference to the terms of the contract. In support of his contention, the respondent's counsel relies very strongly on the observations of the Supreme Court in Chatturbhuj Vithaldas v. Moreshwar Parashram : 1SCR817 while on the other hand the petitioner's counsel has tried to distinguish the aforesaid decision and places reliance on the decision of the Madhya Pradesh High Court in Gauri Shanker v. Maya Dhardas, : AIR1959MP39 .
In : 1SCR817 the facts were that the appellant before them had entered into a contract with the Central Government for the supply of 'bidis' for sale to its troops through its canteens. It is found from the judgment that the contractor had fully executed his part of the contract and what remained to be done was payment by the Government. The question that arose before the Supreme Court was whether the contract for the supply of goods terminates when the goods are supplied, or it continues in being till the payment is made and the contract is fully discharged by performance on both sides. The opinion of the Supreme Court was that it continues in being till it is fully discharged by performance on both sides. The Madhya Pradesh High Court while referring to the facts of the case in the Supreme Court decision states that the facts of the case before them were entirely different. Therefore the observations made by the Madhya Pradesh High Court must be taken in the context of the facts of that particular case.
The general principles which guide the consideration of the question whether the contract subsists or not, are laid down in the Supreme Court decision. Before referring to them, I may point out that in the Madhya Pradesh decision, their Lordships refer with approval to the observations of the House of Lords holding that when a contract is at an end by the acceptance of the breach, the contract survived for the working out of ancillary matters like the one for determination of the quantum of damages for breach of the enforcement of the arbitration clause, if any. With reference to the above observations of the House of Lords, their Lordships for the Madhya Pradesh High Court observe:
'According to them, the repudiation of a contract by one of the parties gives an option to the other either to hold the party in breach to the contract and ask for its performance or to rescind the contract altogether. If the option is exercised to rescind the contract, the contract is at an end in so far as its performance by one or the other or both is concerned. The contract, however, survives for any incidental or ancillary purpose because the determination of the quantum of damages for breach or the enforcement of the arbitration clause, if any, depends upon the terms in the agreement, and it may be looked into for the limited purpose'
From this it follows that even after determination of the contract, the contract survives for incidental or ancillary purposes. Referring to the facts of the case before them, the Madhya Pradesh High Court held that the case before them was one on which both sides elected not to proceed with the performance and to terminate the contract and treat it as rescinded. Therefore in the case before them there was nothing more to be done in pursuance of the contract. In fact their Lordships further observe:
'Payment of price is a different matter and claim for damages is quite another. We do not consider it necessary to examine cases of frustration novation, etc. because those cases must be pronounced upon when they arise'
Sri B. T. Parthasarathy pointed out with reference to Anson's Law of Contract that a contract is discharged (a) by agreement (b) by performance. (c) by breach, (d) by frustration or (e) by operation of law. He submits that the case of the petitioner, comes under discharge by agreement and not by performance or any other head. On the basis of my finding on the question of fact, the case comes under discharge by breach. Even then, it is contended that owing to discharge of the contract by breach, the contract ceases to subsist. In this context a reference to the decision of the Supreme Court in : 1SCR817 and an examination of its implication becomes relevant. It is pointed out by the learned counsel for the respondent that the Supreme Court has unequivocally repelled the contention that supplies of goods having been made by the contractor, there was no longer any contract for supply of goods in existence but only an obligation arising under the guarantee clause. While repelling the contention, their Lordships of the Supreme Court observe:
'When a contract consists of a number of terms and conditions, each condition does not form a separate contract but is an item in the one contract of which it is part. The consideration for each condition in a case like this is the consideration for the contract taken as a whole. It is not split up into several considerations apportioned between each term separately.'
Sri. B. T. Parthasarathy laid emphasis on the term 'for the execution of any works' in S. 9A of the Act. His contention is that after the repudiation of the contract by the petitioner and on its acceptance by the Public Works Department, there was no contract for execution of any works. This construction was not accepted by the Supreme Court as indicated by their observations referred to above, and the following observations:
'It was contended, on the strength of certain observations in some English cases, that the moment a contract is fully executed on one side and all that remains is to receive payment from the other, then the contract terminates and a new relationship of debtor and creditor takes its place. With the utmost respect we are unable to agree. There is always a possibility of the liability being disputed before actual payment is made and the vendor may have to bring an action to establish his claim to payment. The existence of the debt depends on the contract and cannot be established without showing that payment was a term of the contract.' It must be noticed that Explanation in Section 9A excludes from the purview of Section 9A contract which has been fully performed by the person by whom it has been entered into with the appropriate Government and in that circumstance the contract is to be deemed not to subsist, by reason the fact that the Government has not performed its part of the contract either wholly or in part. It must be mentioned that it was fairly conceded by Sri. B. T. Parthasarathy that the petitioner's case does not come within the purview of the Explanation. The exception to the application of Section 9A of the Act provided in the explanation refers to a case of discharge of contract by performance. i.e, where the contract is fully performed' by one party. All other cases not covered by the Explanation come within the scope of the disqualification under Section 9A. Sri Parthasarathy also made it clear that excepting the execution of the works under the contracts, the rights and liabilities of the parties were to be determined according tot he terms of the contracts.
The petitioner's counsel contended that the observations of the Supreme Court relate only to a case of discharge of contract by performance and not by agreement or breach. This cannot be accepted. The observations of the Supreme Court with reference tot he existence of the debt that the same depends on the terms of the contract also refer to the existence of rights and obligations arising for determination under the terms and conditions of the contract, discharged under the circumstances other than by performance, viz. (a) by agreement, or (b) by breach, (which are relevant to this case).
Therefore, on the reasoning of the Supreme Court, the existence of the rights and obligations between the parties cannot be established without reference to the terms of the contract. Hence, the contract survives for the working out of ancillary matters relating to the rights and liabilities of the parties under the contract. It is pointed out that the explanation to Section 9A was included in the Representation of the People (Amendment) Act, 1966 to avoid the rigour of the Supreme Court decision with regard to persons who had fully performed their part of the contract. It appears to be so.
(21) My attention was also drawn by the learned counsel for the respondent, to the observations of the Supreme Court regarding the purpose of inclusion of Section 7(d) of the Representation of the People Act, as it then was, which now corresponds to Section 9A of the Act, as amended in 1966. The observations of the Supreme Court are:
'The purpose of the Act is to maintain the purity of the legislatures and to avoid a conflict between duty and interest. It is obvious that the temptation to place interest before duty is just as great when there is likely to be some difficulty in recovering the money from Government (for example, if Government were to choose not to rectify the contracts) as when there is none.'
I may also refer in this connection to the observation of the Calcutta High Court in : AIR1960Cal92 which is as follows:
'Provisions like Section 7(d) have been a familiar feature of election laws from very early times. They are based on a sound, solemn and salutary principle which democracies or democratic constitutions can ill-afford to spare or ignore. Their purposes to guarantee the purity of the legislature and of the administrative machinery as well and it has been variously put by various eminent judges and noted authorities but always with an eye to the guarantee of purity of the legislature and the administration and to keep the source or the fountainhead of law and the stream of administration unsullied and free from corruption. The basic stand-point is 'to prevent conflict between interest and duty which would otherwise inevitably arise' (per Lindley L. H. in Nutton v. Wison, (1889) 33 QBD 744 at p. 748) and 'to prevent the member concerned from being exposed to temptation or even the semblance of temptation' (per Lord Esher M. R. in the same case, (1889) 22 QBD 744 at p. 747), and that has never been questioned.'
Bearing these principles in mind, even though the contract may be repudiated by one party and repudiation is accepted by the other, and there is a discharge of the contract by breach, by the failure of one of the parties to perform his part of the contract, the mutual claims between the parties require to be determined under the terms of the contract which exists though for ancillary purposes, giving rise to the conflict between interest and duty as visualised in the observations of the Supreme Court and the other decisions which I have quoted above. Therefore, in the circumstances of this case, the contention of the respondent that the disqualification under Section 9A of the Act attaches to the petitioner, even though there may be a determination of the contract between him and the State should be accepted.
(22) For these reasons, my finding on the first issue in the case is that the contractual relationship between the petitioner and the Government was subsisting on 21-1-1967 and the petitioner was disqualified to stand for election under Section 9A of the Act.
(23) In the result the Election petition is dismissed. In the circumstances of the case. I direct that the petitioner shall pay the costs of the respondent. Advocate's fee is fixed at Rs. 500
( 24) Petition dismissed.