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Sudershan Kumar Vs. Union of India and ors. - Court Judgment

LegalCrystal Citation
SubjectExcise
CourtDelhi High Court
Decided On
Case NumberCivil Writ Appeal No. 548 of 1971
Judge
Reported inAIR1974Delhi119
ActsConstitution of India - Article 226
AppellantSudershan Kumar
RespondentUnion of India and ors.
Advocates: S.N. Chopra,; S.L. Bhatia,; R.K. Mehta,;
Cases ReferredSita Ram v. Radha Bai and
Excerpt:
in the instant case, it was noticed that a civil suit in respect of the same matter was pending which was likely to create confusion and multiplicity of judicial proceedings - it was ruled that non-entertainment of writ petition upon existence of alternate remedy was a rule of discretion and not one of limitation of the power of the high court - - after enquiries the collector of excise by order dated june 9, 1967; approved and endorsed the names of jagmohan kalra as well as hans raj kalra in the l-2 license of the firm. 6 failed to honour his commitments and did not make the payments as had been agreed to by him. hans raj thereafter complained that in spite of his requests and representations, this order of the high court was not being complied with by the authorities and on this.....s.n. shankar, j. (1) on may 17, 1971, sudershan kumar kalra filed this writ petition under articles 226 and 227 of the constitution praying that the following orders of the collector of excise, respondent no. 4, lieutenant governor, union territory of delhi, respondent no. 2 and commissioner of excise, respondent no. 3 be quashed: 1.order dated october 9, 1969 passed by the collector of excise holding that the l-2 license mentioned in the petition was individual property of respondent no. 6, kishan lal kalra; 2. order dated march 31, 1971 passed by the collector of excise determining the said license for non-renewal; 3. order dated april 1, 1971, passed by the lieutenant governor sanctioning the issuance of fresh l-2 license in favor of kishan lal kalra ; and 4. order dated april 6, 1971.....
Judgment:

S.N. Shankar, J.

(1) On May 17, 1971, Sudershan Kumar Kalra filed this writ petition under Articles 226 and 227 of the Constitution praying that the following orders of the Collector of Excise, respondent No. 4, Lieutenant Governor, Union Territory of Delhi, respondent No. 2 and Commissioner of Excise, respondent No. 3 be quashed:

1.Order dated October 9, 1969 passed by the Collector of Excise holding that the L-2 license mentioned in the petition was individual property of respondent No. 6, Kishan Lal Kalra; 2. Order dated March 31, 1971 passed by the Collector of Excise determining the said license for non-renewal; 3. Order dated April 1, 1971, passed by the Lieutenant Governor sanctioning the issuance of fresh L-2 license in favor of Kishan Lal Kalra ; and 4. Order dated April 6, 1971 passed in appeal by the Commissioner of Excise.

(2) He has also prayed in clause (b) of the prayer clause that a writ in the nature of mandamus or any other writ or directive or order be issued directing that the L-2 license as issued on September 1, 1956, referred to in the petition to M/s. Esplanade Bar and Restaurant and modified from time to time be deemed to be still operative and in vogue. The other respondents imp leaded in the writ petition are Union of India, respondent No. 1, Hans Raj Kalra, respondent No. 5, Kishan Lal Kalra, respondent No. 6 and Jagmohan Kalra, respondent No. 7. The license in question in the meantime was transferred in favor of Kishan Lal, Wine Merchants (P) Ltd. The petition was, thereforee, amended and the Limited Company was added (in the first amended petition) as respondent No. 8.

(3) On October 1, 1971, the petitioner Sudershan Kumar Kalra died. His widow, two sons, one of whom is a minor and three minor daughters thereupon applied to be imp leaded as petitioners in place of the deceased. By order dated December 21, 1971, this application was accepted subject to just exceptions. The petition was, thereforee, amended for the second time. The widow Shrimati Sheela Devi, two sons and three daughters of Sudershan Kumar are thus now the six petitioners in the present (second) amended petition dated January 11, 1972.

(4) The petition is opposed by respondents 1 to 4 as also Kishan Lal respondent No. 6 and the Private Limited Company, respondent No. 8. Hails Raj, respondent No. 5 has supported the petitioners.

(5) According to the petition, in the year 1938, Ishar Dass, father of the deceased petitioner Sudershan Kumar, started wine business in the name of 'Esplanade Bar and Restaurant' at Banarsi Krishna Mansion, Chandni Chowk; Delhi which was a business of the Joint Hindu Family. It was continued under the name of 'Messrs Ishar Dass Kalra and Sons'. This business continued to be owned by the Joint Hindu Family of which Ishar Dass and his three sons, namely, the deceased petitioner and respondents 5 and 6 were members. The business was being carried on under L-4 license for retail sale of foreign liquor in restaurant. On June 2, 1946, Ishar Dass died suddenly. All rights, title and interest in this business, according to the petitioners, thereupon devolved jointly on the three sons of the deceased. The liquor license which was the property of the Hindu Undivided Family, it is stated, continued in the same name through Kishan Lal, respondent No. 6 as a legal representative. In order to obtain continuance of the license the petitioners state that Kishan Lal, in pursuance of a family arrangement, made an application to the Deputy Commissioner, Delhi, on June 7, 1946 as Managing Proprietor of Ishar Dass Kalra and Sons with a view to continue the business. On March 14, 1947, a partnership deed was also executed between them in respect of the business effective from June 3, 1946, the day next after the death of their father Ishar Dass. In 1950, respondent No. 5, the eldest of the three brothers, by mutual arrangement between the brothers, left the business of Esplanade Bar and Restaurant as he took a country liquor license; so that the business of Messrs Esplanade Bar and Restaurant became the property of the two brothers only i.e. deceased petitioner Sudershan Kumar and respondent No. 6 Kishan Lal. A deed of partnership dated April 27, 1950 was also executed between them effective from April 1, 1950.

(6) In August, 1956, as a result of introduction of the policy of prohibition on the consumption of liquor in public, all public bars were closed and L-4 licenses were abolished with effect from August 14, 1956. On August 18, 1956, the Chief Commissioner approved the grant of L-2 license to the existing holders of license L-4 (other than hotels) provided they applied for the same and fulfillled certain conditions. Among the L-4 licensees was the name of 'M/s. Esplanade'. Respondent No. 6 on this basis, according to the petition, applied for the grant of an L-2 license to the Collector of Excise. On September 1, 1956, an L-2 license in the name of 'Shri Kishan Lal s/o Shri Ishar Dass, of 5, Sin Ram Road, Delhi of 'M/s. Esplanade' was accordingly issued. The words 'Bar and Restaurant', according to the petition, were omitted from this license because under the L-2 license bars were prohibited and restaurants could not be run in the same premises where liquor was to be sold. Another partnership deed in respect of the business was then executed between deceased Sudershan Kumar and respondent No. 6 on November 7, 1956, effective from September 1, 1956, the day on which the Chief Commissioner permitted the carrying on of the business under L-2 license. On March 6, 1958, respondent No. 6, as managing partner, wrote to the District Excise Officer intimating that the Bar and Restaurant had been closed and that the business was thereafter being run under L-2 license in the name of Kishan Lal & Company with no change in the constitution of the firm and necessary changes may be made in the excise records. On this letter, the Collector of Excise raised a doubt and an enquiry was held. After recording the statements of both the partners i.e. respondent No. 6 and the deceased Sudershan Kumar in this enquiry wherein respondent No. 6 stated that he was a representative licensee of the firm Esplanade Bar and Restaurant, the Collector approved the change of name of firm from 'M/s. Esplanade' to 'M/s. Kishan Lal & Co.' This approval was communicated to the firm by letter dated July 14, 1958. In 1960-61, Shri V. R. Bapat, Commissioner of Excise again directed an equiry into the constitution of all firms holding licenses in firm names. Respondent No. 6 again, as Managing Partner of Kishan Lal & Co., by his letter dated March 29, 1961, confirmed that this firm consisted of himself and Sudershan Kumar. For the year 1961-62 accordingly lincence in L-2 form for the business was prepared which contained the names of Kishan Lal and Sudershan Kumar as co-licensees and this license thereafter continued to be renewed from year to year. Thereafter, Jagmohan Kalra son of respondent No. 6 was also admitted to the partnership to share the profits of his father. A new partnership dated July 1, 1964 was thereforee executed. On July 27, 1964, the two partners of the old firm, respondent No. 6 and Sudershan Kumar consequently applied for the inclusion of the name of Jagmohan Kalra in this license. Thereafter, Hans Raj Kalra, respondent No. 5 also rejoined the firm Kishan Lal & Co., and a fresh deed of partnership dated July 1, 1966, was executed. On December 10, 1966 another application for the inclusion of the name of Hans Raj also in the license was made. After enquiries the Collector of Excise by order dated June 9, 1967; approved and endorsed the names of Jagmohan Kalra as well as Hans Raj Kalra in the L-2 license of the firm.

(7) During all this period, according to the petition, the entire correspondence on behalf of the firm was carried on with the Excise Department of Kishan Lal, respondent No. 6, as Managing Partner by the firm and he applied for renewal of the license from year to year.

(8) Towards the end of 1966, the petition states that it came to the notice of Sudershan Kumar and Hans Raj, respondent No. 5, that very substantial amounts of the partnership were being illegally and surreptiously diverted by Kishan Lal respondent No. 6 and he had also by manipulation raised huge loans on bogus 'hundies'. Differences thus arose between the partners but they were amicably settled by arbitration and a new deed of partnership dated April 19, 1967 was executed between them. At this stage, according to the petition, large amounts were due from respondent No. 6 to the partnership. The new deed of partnership provided for the repayment of these amounts by respondent No. 6 along with interest within a period of two years in terms of the deed. The deed also provided that respondent No. 6 shall not withdraw any further amounts from the partnership funds except a sum of Rs. 1500 per month at terms of its clause 10 (B). The affairs of the firm, the petitioners state, thereafter proceeded smoothly till about October, 1967 but respondent No. 6 failed to honour his commitments and did not make the payments as had been agreed to by him. Differences, thereforee, again arose, and respondent No. 6 wanted to eliminate Sudershan Kumar and Hans Raj altogether from the firm.

(9) With this object, on November 7, 1967, respondent No. 6 submitted an application to the Lieutenant Governor and claimed that L-2 license was his individual property and that he did not know why the names of other partners had been included in the license at his back without his knowledge and also without the sanction of Lieutenant Governor. This application was forwarded by the Lieutenant Governor to the Excise Commissioner with an endorsement. The Excise Commissioner, by his order dated February 7-7-1968, struck out the names of Hans Raj and Jagmohan Kalra from the license without giving an opportunity of being heard to these persons. Hans Raj thereupon filed a writ petition in the High Court against the illegal deletion of his name. On February 27, 1969, the writ petition was accepted by the High Court on the ground that no hearing had been granted to Hans Raj before excluding his name from the license and the matter was remanded to the Commissioner of Excise to be heard afresh and decided according to law. Hans Raj thereafter complained that in spite of his requests and representations, this order of the High Court was not being complied with by the authorities and on this grievance filed a second writ petition. On May 26, 1969, the High Court dismissed this writ in liming with the observations that the order by which the names of Hans Raj and Jagmohan had been removed from the license had already been quashed and this order, thereforee, had to be completely ignored with the result that the names of Hans Raj and Jagmohan Kalra would, for all purposes, be deemed to have been included in the L-2 license till the same were again deleted in accordance with law. In the meantime, respondent No. 6 had filed certain complaints to the Lieutenant Governor against Sudershan Kumar whose name at that stage still appeared on the license. He (respondent No. 6) also applied to the Collector of Excise under section 39 of the Punjab Excise Act to take over management of the L-2 license. On July 6, 1968, the Collector without notice to Sudershan Kumar, it is alleged, took over the management as prayed for by respondent No. 6 and appointed one I. D. Gulati as the sole manager of the business. Sudershan Kumar, in these circumstances, on December 11, 1968, filed suit No. 852/68 and prayed for rendition of accounts of the partnership Kishan Lal & Co., and payment of his share of profits for the period with effect from April 19, 1967 to November 30, 1968. He also prayed for a perpetual injunction against respondent No. 6, and his son Jagmohan Kalra restraining them from with drawing any amount from the partnership in contravention of clause (10-B) of the Partnership deed dated April 19,1967.

(10) The Excise Commissioner in compliance with the order of the High Court dated February 27, 1969, took up the matter afresh. It appears that at this stage the application of respondent No. 6 dated November 7, 1967 also came up before him. By order dated July 8, 1969, the Commissioner remanded the case to the Collector of Excise 'for a thorough enquiry into the matters raised in the petition dated 7th November, 1967 for a disposal of the petitions dated 27th July, 1964 and 10th December, 1966'. By his order dated October 9, 1966, the Collector of Excise, on this remand, held that the L-4 license had been granted on July 5, 1946 to respondent No. 6 as an individual and he continued to hold the same as such and the subsequent endorsements made on the license in the years 1953 and 1961 had the effect of transfering the license held by an individual to 'a partnership firm' and as no order of transfer had been passed by the granting authority, the Chief Commissioner, the said 'transfers' were a nullity. The endorsement on the license substituting the words Kishan Lal & Co., instead of the words M/s. Esplande and the order dated July 27, 1961 whereby the name of Sudershan Kumar was added in the license as a partner by treating the license as having been granted to a partnership were also held to be illegal for the same reason. The license accordingly was directed to be restored to its original form as granted on September 1, 1956, to Kishan Lal as individual. In consequence, the name of Sudershan Kumar appearing in the license was deleted. Aggrieved from this order, Sudershan Kumar filed an appeal and also applied for stay of operation of the order.

(11) In the meantime the license for the year 1970-71 was to expire in March, 1971. On January 4, 1971, respondent No. 6 as usual applied for the renewal of his license. On March 30, 1971, however, he wrote to the Collector of Excise that his application may be treated as withdrawn but on the next day i.e. March 31, 1971 he submitted a fresh application to the Lieutenant Governor for grant of L-2 license in his own name for the same premises where the business of the partnership was being carried on. On the letter of respondent No. 6 dated March 31, 1971, requesting for withdrawal of his previous application, the Collector recorded on March 31, 1971, that the previous license stood 'determined due to non-renewal'. On the day following i.e. April 1, 1971, the Lieutenant Governor sanctioned the issuance of a fresh L-2 license in the name of respondent No. 6.

(12) In the new situation as it developed after the sanction and grant of this L-2 license the appeal filed by Sudershan Kumar from the order of Collector of Excise dated October 9, 1969, was dismissed as infructuous by the Commissioner of Excise by a brier order dated April 6, 1971. In the detailed order recording reasons for the dismissal he also endorsed the findings of the Collector of Excise that license had originally been issued to respondent No. 6 as an individual and its subsequent transfers were illegal. In the meantime the license was transferred by respondent No. 6 under orders of the Lieutenant Governor dated April 1, 1971 to the Limited Company, respondent No. 8 as from May 16, 1971.

(13) The case of the petitioners is that all these orders passed by the Excise authorities be quashed for reasons stated in the petition as the same arc vitiated, illegal and mala fide and that it may further be held that the licenses in pursuance of which respondent No. 6 all along conducted the business was in fact the continuation of the original L-4 license granted to their grandfather Ishar Dass.

(14) The contesting respondents have raised several preliminary objections. The first preliminary objection raised by Shri F. S. Nariman, Additional Solicitor General, appearing on behalf of respondents 1 to 4 is that the present petitioners have no locus standi to claim the relief prayed for in the petition after the death of Sudershan Kumar. He urged that the last license granted to Kishan Lal by the Excise authorities was under clause (2) of rule 4.2 of the Delhi Excise Manual Vol. Ii (hereafter called 'the Rules') and as this grant was not challenged the prayer in clause (b) of the relief clause could not be granted. The learned counsel also referred to the proviso of rule 5.7 of the Rules and maintained that the addition of the name of legal heirs of a deceased partner in the license was in all cases at the sole discretion of the collector and because the petitioners had not even alleged that they had even applied to be so added, their claim that the L-2 license as issued on September 1, 1956 to M/s. Esplanade Bar and Restaurant was to be deemed to be still operative and in vogue after the death of Sudershan Kumar, was wholly untenable. He placed heavy reliance on C. Bechivenkata Rao v. The Union of India and others : [1972]3SCR665 , which was a case under Mineral Concession Rules and where it was held that in order to enable a legal representative to continue legal proceedings the right to sue or to pursue the remedy must survive the death of his predecessor.

(15) We do not find merit in these objections. As would be seen from the facts stated above the case of the petitioners broadly put is that the licenses held by respondent No. 6 in pursuance of which he carried on liquor business and which were got renewed from time to time were really a continuation of the L-4 liquor license originally granted by the Excise authorities to their grand-father Ishar Dass who carried on the business of vending liquor in the premises known as Banarsi Krishna Mansion, Chandni Chowk, Delhi. After the death of Ishar Dass, the petitioners claim, that this business devolved on the three sons of the deceased, including their father Sudershan Kumar, and was continued with respondent No. 6 acting as the Managing Partner or Proprictor-in-charge of the business for and on behalf of all the brothers. This, they say, was in pursuance of a family arrangement. Acting as Managing Partner, representing all the brothers, they maintain that respondent No. 6 applied to the Excise authorities for the issuance of licenses for the business and the authorities on this basis actually issued the licenses and respondent No. 6 was all through allowed by different arrangements agreed to from time to time to continue the business. The licenses under which the business was continued, they contend, were granted by the Excise authorities on the basis of the L-4 license originally held by their grandfather. This business, they further claim, was carried on by respondent No. 6 all along with the joint assets of the parties and in the same premises where the joint business was being done in the life time of Ishar Dass. Respondent No. 6, they say, earned profit from this business and is liable to account for the same. Their father, they say, had the right to ask for the accounts and after his death this right survives to them. They thus claim an interest in the business conducted by respondent No. 6 and its assets including the rights in the licenses under which it was continued. These licenses, they say, at one stage contained the name of their father Sudershan Kumar also as a colicensee but the Excise authorities wrongfully, illegally and mala fide deleted the name of Sudershan Kumar from the licenses with a view to help respondent No. 6 and further recognised the transfer of this license to a third entity by means of the impugned orders. These orders, they say, cloud their title to and rights in the business carried on under the licenses. By praying that the impugned orders be quashed they seek to have this cloud removed. Assuming the case as set up in the petition to be true, as indeed we are bound to assume for purposes of the preliminary objection, we do not sec why the petitioners are not entitled to have this cloud removed. They have in this view, to our mind. a locus standi to ask for the reliefs prayed for in this pertition. The death of Sudershan Kumar during the pendency of the petition makes nut the slightest difference in the context or the claim that the petitioners seek to establish. Reference to rule 4.2 or rule 5.7 in these circumstances is of no avail. If the business was carried on and continued by respondent No. 6 and the latter derived profits from the transaction of the firm or from the use of the property or business connection of the firm and a case under section 16 of the Partnership Act is made out or a fiduciary relationship is otherwise proved to exist between the parties, the petitioners have a right in law to claim accounts from respondent No. 6 and in that context have the locus standi to challenge the impugned orders. If the Excise authorities, knowing full facts acted mala fide an illegally in deleting the name of Sudershan Kumar from the license and if respondent No. 6 acted in a representative capacity as a Managing Partner or Proprietor of the Joint business in pursuance of a family arrangement, as alleged by the petitioners, the impugned orders do operate to raise a cloud to the title of the petitioners in the enforcement of their right to seek accounts and they are entitled to have it removed by asking for the prayers made in this petition. They have thus, in our view. a loan standi to file this petition.

(16) The observations of the Supreme Court in C. Bechivenkata Rao's case relied upon by the learned counsel are also of no assistance to the respondents. That was a case under the Mineral Concession Rules. The deceased applicant in that case filed an application for the grant of milling lease and claimed to be entitled to the grant of the license on the basis of an alleged superior claim which was personal to him. After his death during the pendency of the petition, when his legal representatives sought to continue the proceedings it was not permitted because the Court found:-

'IN the instant case, we have set out provisions showing that the rights which an applicant may have had for the grant of a mining lease, on the strength of an alleged superior claim, cannot be separated from his personal qualifications. Ne provision has been pointed out to us in the rules for impleading an heir who could continue the application for seems to be that, if an applicant dies a fresh application has to be presented by his heirs or legal representatives if they themselves desire to apply for the grant of a lease ..................'.

(17) On the allegations made in the petition this is not the case here. The right to claim accounts of the business carried on under the various licenses in question vested in Sudershan Kumar and after his death survived to the petitioners. If the impugned orders cloud this right the petitioners undoubtedly have a locus standi to challenged them as stated earlier.

(18) Shri C. K. Daphtary, appearing for the Company, respondent No. 8 urged that the L-2 license which had been transferred in favor of his client, the Limited Company, was not a renewal of the old license but was a fresh grant. He said that this grant had not been challenged at all in the writ petition and, thereforee, the petition is not maintainable.

(19) This objection also docs not stand scrutiny as a preliminary objection. Respondent No. 8 Company is admittedly a transferee of the license from respondent No. 6 which accordingly to the petitioners was a joint license and has continued to be so all through. If the allegation in the petition are correct and the license transferred was not the exclusive property of respondent No. 6, consequences are to follow which will be relevant for purposes of determining the rights of the petitioners; It cannot at this stage, thereforee, be said that the L-2 license transferred by respondent No. 6 was his exclusive license and because the issuance of this license is not challenged, the petition is not maintainable.

(20) Shri Nariman and Dr. Singhvi (counsel appearing for respondent No. 6) then urged that the petitioners had already taken recourse to an alternative redy in the civil court for the enforcement of their rights which was a more effectual and adequate remedy in the facts and circumstances of this case and they have, thereforee, disentitled themselves from invoking the extraordinary jurisdiction of this Court under Article 226.

(21) After hearing the learned counsel, and Shri S. N. Chopra, appearing for the petitioners, we find substance in this objection. As stated earlier, the petitioners have admitted that Sudershan Kumar, during his life time, filed a suit (registered as suit No. 852 of 1968 and renumbered as suit No. 35/71) for rendition of accounts in respect of the business carried on by respondent No. 6 under the various licenses issued by the Excise authorities from time to time referred to in this petition. In this suit, Sudershan Kumar prayed for rendition of accounts for the period from April 19, 1967 to November 30, 1968. After the death of Sudershan Kumar, the petitioners applied under order 22 rule 2 for being substituted in place of the deceased. This prayer was allowed. They also prayed for amendment of the plaint filed by Sudershan Kumar under Order 6 rule 17 on the ground that 'some important developments and changes in the functioning of the firm M/s. Kishan Lal & Co., have taken place, at the instance of Shri Kishan Lal, defendant No. 1'. This application of theirs was also accepted. The plaint of the original suit was consequently amended. In the amended plaint, the petitioners specifically mentioned the impugned orders along with some other orders passed by the Excise authorities and challenged their legality and validity on various grounds including their being mala fide. Para 21 of the amended plaint filed in Court reads as under:-

'THAT the plaintiffs respectfully submit that the aforesaid orders dated 9-10-1969 and 31-3-1971 passed by the Collector of Excise, orders dated 8-7-1969 and 6-4-1971 passed by the Commissioner of Excise and orders dated 1-4-1971 and 15-5-1971 of the Lt. Governor are all wholly illegal, void and mala fide and as such inoperative. The whole thing was pre-planned and wangled as the defendant No. 1 and the Excise Department could not face the grounds put forth in the appeal. Under the circumstances, the previous L-2 license issued in August, 1956, in favor of M/s. Esplanade Bar and Restaurant which was subsequently restyled as M/s. Kishan Lal & Co. and of which the deceased plaintiff were undisputedly recognised co-licensee and the plaintiff continues as co licensee, actually and in law continues to be effective even though the business is now being carried on in the name of M/s. Kishan Lal Wine Merchants (Pvt.) Ltd.'.

(22) They also enlarged period of accounting in the amended plaint. As against the prayer for accounts from April 19, 1967 to November 30, 1968 as prayed for by Sudershan Kumar in the amended plaint (dated April 25, 1972) they prayed for a decree for accounts from 19-4-1967 up to date'. On contest by the defendants the Court framed several issues. Issue No. 36 framed on October 4, 1972 relates to the impugned orders. It is in the following terms:-

'WHETHER orders dated 9-10-69, 21-3-71, 8-7-69, 6-4-71, 1-4-71 and 15-5-71 passed by the Excise authorities are illegal and void.'

(23) The question as to the validity or otherwise of the impugned orders is thus also before the court in the suit that is now being prosecuted by the petitioners. This is not all. It was admitted by the parties during arguments that Hans Raj respondent No. 5 aggrieved from the impugned orders has also filed suit No. 429 of 1971 in October, 1971 against respondent No. 6. In the suit he has imp leaded the first four respondents in this petition as defendants 1 to 4, respondent No. 6 is defendant No. 5, the petitioners are defendants 6 to 11 and the Limited Company, respondent No. 8 is defendant No. 13. In this suit, Hans Raj also has challenged orders impugned in the present petition. Amongst other reliefs he has prayed that it be declared that he, Sudershan Kumar and respondent No. 6 'were co-licensees of the L-2 license from 1-7-66 till 2-4-71 in respect of the business of M/s. Kishan Lal & Co.. Wine Merchants, carrying on business in the business premises Banarsi Krishna Mansion, Chandni Chowk Delhi'. The present petitioners in answer to this suit have filed a supporting written statement. The other defendants including the present respondents 1 to 4, 6 and 8 are contesting this suit. On the pleadings of the parties the court has framed issues 13,15 and 17 in the following terms:

Issue No. 13 Whether the plaintiff, defendant No. 5 and Sudershan Kumar were co-licensees of L-2 license from 1st July, 1966 until 2nd April, 1971 in respect of the wine business carried on by the firm, M/s. Kishan Lal & Co?

Issue No. 15 Whether the orders dated 8-7-1969, 9-10-1969, 31-3-1971, 1-4-1971, 6-4-1971 and 15-5-1971 passed by the Excise. authorities are illegal, ultra vires, arbitrary and mala fide and thereforee null and void ?

Issue No. 17 Whether L-2 license dated 2-4-1971 in the name of Kishan Lal and in the name of Kishan Lal Wine Merchants (Private) Limited on or about 15th May, 1971 is or should be taken to be the property of the plaintiff and defendants No. 5 to 13?

(24) The parties in suit No. 429 of 1971 filed by Hans Raj and suit No. 852 of 1968 filed by Sudershan Kumar have agreed in the civil suits that oral and documentary evidence in suit No. 429 of 1971 will be read as evidence in suit No. 35/71 with liberty to them to produce additional evidence if they so liked. This agreement was recorded by the court trying both the suits together, by order dated July 31, 1972. Copies of the plaint, written-statement of the present petitioners, issues framed by the court and the order, which we have referred to, were all filed before us during arguments.

(25) It would thus be seen that the subject matter of the present petition is identically the same and is fully covered by the civil suit which is being prosecuted by the petitioners. After the death of Sudershan Kumar they themselves introduced the controversy in regard to the legality and validity of the impugned orders in this suit by amending the original plaint. They are further parties to the suit filed by Hans Raj here again these very orders are under scrutiny. The interests of the petitioners and Hans Raj are identical both in the civil suit as well as the present writ petition. In the civil suit prosecuted by the petitioners, Hans Raj has filed a supporting written statement. Likewise, the petitioners in the civil court have supported the claim of Hans Raj. In para 26 of the present writ petition the petitioners case is that respondent No. 6 manoeuvered the impugned orders to oust both Sudershan Kumar and Hans Raj. Hans Raj in turn in para 53 of his counter to the writ petition states:-

'..................THEanswering respondent is equally an aggrieved party. Both the petitioner and the answering respondent have grievously suffered on account of the legal and highhanded actions of the authorities concerned, who have solely acted to help Kishan Lal.'

(26) We arc thus constrained to hold that the present writ petition is nothing more than a parallel proceeding as far as the contentions in regard to the impugned orders and the continuity of the L-4 license are concerned.

(27) Reference to the pleadings and other issues framed in the civil suits, however, showed that the contesting defendants in the civil suit, namely, respondents 1 to 4 and respondents 6 and 8 in the present petition, had raised technical objections to the jurisdiction of the civil court to go into the question of correctness and validity of the impugned orders assailed in this petition. The question, thereforee, arose whether the suits in these circumstances would be an effective remedy for the petitioners. It was apprehended that if these pleas of the contesting dependants were accepted in the suit the petitioners would be left without a remedy. Before the matter proceeded to the stage of examination of this aspect on its merits, the learned counsel for respondents 1 to 4 volunteered an undertaking that his clients would not press these technical issues and will not question the competence of the civil court to go into the validity of the impugned orders on grounds urged by the petitioners. Respondent No. 6 also filed an application (C.M. 195-W/73) volunteering the same under-taking. A similar undertaking was put on record on behalf of respondent No. 8. In face of these undertakings, we have no reason to assume that the civil court will not be able to examine the validity of the impugned orders in the suits pending before it. We have, thereforee, no hesitation in coming to the conclusion that the petitioners in this case not only have, but have already availed of an alternative remedy for the redress of their grievance sought to be agitatted by them in this writ petition.

(28) It was urged that the existence of an alternative remedy was no bar to the exercise of jurisdiction by the High Court under Article 226. The contention in the abstract is correct. Power to issue a writ, it is true, if there exists an alternative remedy, is only a rule of discretion and expediency and not one of jurisdiction or limitation on the power of the High Court. The further question, thereforee, to be seen is whether in the facts of this case it would be just and proper to decline the exercise of writ jurisdiction in favor of the petitioners.

(29) While arguing on merits the contesting respondents took pains to show that in the facts of the case, this Court should not exercise its discretion under Article 226 in favor of .the petitioners.

(30) Dr. Singhvi, during the course of his arguments on merits, referred us to Nandlal Khajanmal Chhatri v. Thomas J. William A.I.R. 1937 Nag 250 (2) Puvvada Venkata Subbayya v. Attar Sheik Mastan A.I.R. 1949 Mad 252 (3), Velu Padayachi v. Sivasoo riam Pillai : AIR1950Mad444 , Muddi Narayanam and Bro., a Firm and others V. Kanumuri Subbaraju and others 1957 AP 837 (5) and a number of other authorities and urged that the Partnerships relied upon by the petitioners entered into for the purpose of conducting the business under a license, granted or to be granted, were ab initio void but he said that a claim for accounts could still be laid in respect of a business if other circumstances were found to exist. The learned counsel cited Sita Ram v. Radha Bai and others A.I.R. 1968 SC 543 (6)) where it was held that where the parties were not in pari delicto the less guilty party may still be able to recover the money paid or property transferred under the contract. This possibility, the Supreme Court has said, in this case, could arise in three situations specifically categorised in the judgment. This includes a situation where a party Was induced into contract by fraud or strong pressure as also a situation where the party was under a fiduciary duty not to retain the property or to refuse to account for monies received on the ground that the properties or the monies had come into his hands as the proceeds of an illegal transaction. He also drew our attention to the recent decision of the Division Bench of the Punjab and Haryana High Court in Badh Ram Balak Ram and another v. The Dhuri Co-operative-cum-Marketing-cum-Processing Society, Dhuri and others , where it was held that even though there was prohibition for formation of a partnership by the licensee and the license was a personal privilege the benefit whereof could not be extended to others by entering into partnership but still if the plaintiff was a sleeping partner, following the rule of law laid down in Sita Ram's case (supra) the suit for rendition of accounts of the dissolved partnership could still be maintained 'no matter that the partnership agreement be assumed to be void when it is found that the parties are not in pari delicto'. The learned counsel said that in the civil suit the petitioners had based their claim to accounts and title to the license on diverse grounds, including the plea that the whole venture was a joint family business and licenses were obtained in pursuance of family arrangement and the business was worked and carried on with joint assets in the same premises in which their father started it, whereas in the present petition he said the petitioners sought the determination of their right to the licenses solely on the basis of partnership deeds. This, the learned counsel maintained. clearly showed that the petitioners' claim in the civil suit was more comprehensive. After a consideration of the submissions made before us on the first contention of the learned counsel that the partnerships were void, we express no opinion as the question is to be examined on merits in the background of the petitioners' case, that the name of Sudershan Kumar was mala fide removed from the licenses by the Excise authorities retrospectively when both the premises in respect of which the licenses were granted as well as the business actually carried on in pursuance of the same, were to their knowledge joint properties of the parties and the somer sault taken by the authorities at the time of deleting the name of Sudershan Kumar was only to help respondent No. 6. But as far as the second contention is concerned, we are in full agreement with Dr. Singhvi. Petitioners seek to prove their claim in the civil suit on more than one ground and not on the basis of partnerships alone. The decision in this writ petition, thereforee, is likely to lead to confusion and multiplicity of judicial proceedings.

(31) Shri Nariman in support of the same contention referred us to paras 2 and 3 of the present writ petition and pointed out that the petitioners even in this petition seek to base their claim on the basis of a Joint Hindu family and an alleged family arrangement though without particulars or evidence in support of the pleas. He then referred to issue No. 11 framed in suit No. 429 which reads as under:-

'WHETHERL-2 license was the property of Hindu undivided family consisting of the plaintiff, defendant No. 5 and Shri Sudershan Kumar from 2nd June, 1946 up to 18th April, 1967. If not what is the effect?'

(32) The learned counsel urged that questions involved in these pleas cannot effectively be decided on mere affidavits in the present proceedings. There is merit in this submission and we do feel that to do complete justice between the parties the pleas can satisfactorily be adjudicated after full and complete evidence.

(33) For all these reasons in the facts of this case and in view of the undertakings given by the contesting respondents not to press the technical issues in the civil suit, we are of the opinion that it would be just and more appropriate for the matter being decided in the civil suit already pending between the parties.

(34) There is yet another aspect of the matter. In the context of facts stated above, the relief prayed for in this writ, if granted, would be nothing more than mere declarations to be availed of by the petitioners in the civil suit. Writ jurisdiction under Article 226, to our mind, is not meant to serve these ends. In General Manager, Eastern Railway and another v. Kshirode Chandra Khasmobis : AIR1966Cal601 , a Division Bench of the Calcutta High Court said:-

'...............ARTICLE 226 should not be used and was not intended to be used as a medium or means for declaratory orders or declaratory reliefs declaring acts and orders invalid even though no relief could be granted to the petitioner. The Court should not issue writs of consolation or Writs propounding theories. This is not the function, scope and purpose of Art. 226. Nor should it be utilised for subsequent claims in future legal proceedings. Wide as the connotation of the words 'direction' or 'orders' is, it is not so wide as to include such declarations which can be appropriately decided in more appropriate proceedings .....,...'.

(35) Shri S. N. Chopra argued that the petitioners had to assail the orders of respondents 1 to 4 in the civil suit under force of circumstances because these orders had been passed after the death of Sudershan Kumar and when the petitioners got themselves implcaded to continue the suit which they had to do, these orders had to be brought to the notice of the court to completely vindicate their right. The submission cannot be sustained. As stated earlier, the petitioners on being imp leaded enlarged the period of accounting in the suit and it was this that necessitated a challenge to the impugned orders in the suit. The argument of compulsion thus does not stand scrutiny.

(36) Shri Chopra then contended that in this petition he sought the declaration in regard to the impugned orders qua the Excise authorities only on the ground that they were mala fide. He also said that in the writ proceedings where the Excise authorities were bound to produce their record it was easier for the petitioners to substantiate the case than in the regular suit where the facts admitted by the respondents in these proceedings would be difficult to prove. We are unable to agree with the learned counsel. We see no reason why the facts admitted by the contesting respondents in the writ proceedings would be difficult to prove in the civil suit and why the admissions made by the respondents in these proceedings will cease to be relevant in those proceedings. There is no reason to accept the submission of the learned counsel that the relevant record available for purposes of the writ proceedings will be withheld by the Excise authorities from the court in the civil suit. The argument that the declaration in this writ is sought only against the Excise authorities is also without force because as shown earlier the declaration is in extricably connected with the petitioners' right to claim accounts and would be as much operative against the Excise authorities as against the other contesting respondents.

(37) Lastly, Shri Chopra contended that in civil court under issue No. 36, extracted above, as framed in suit No. 35 of 1971, it will not be open to the petitioners to challenge the orders on the ground of mala fide. There is no merit in this submission. As pointed out by Dr. Singhvi in para 21 of the plaint one of the grounds of attack to these orders is that they are mala fide. Issue No. 36, the learned counsel said and rightly, covers all the pleas raised in the plaint in regard to these orders. This issue thus covers the plea of the petitioners that the orders are liable to be quashed on the ground of their being mala fide.

(38) In the result, we are of the view that the ends of justice would be better served if the parties are left to agitate the merits of the impugned orders in the civil litigation already pending between them. Having regard to the nature of the controversy and questions of fact involved therein we are of the opinion that the claim in regard to the continuance of the original L-4 license also can more appropriately be decided on complete and full evidence rather than mere affidavits.

(39) The writ petition for this reason is dismissed but having regard to the circumstances of the case parties shall bear their own costs.


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