Patna High Court
Deochandra Jha vs Ramchandra Mishra And Anr. on 1 March, 1961
Equivalent citations: AIR1964PAT111, AIR 1964 PATNA 111, ILR 40 PAT 938
JUDGMENT Misra, J.
1. Appellant Deochandra Jba was one of the foul-candidates who contested the election to the Bihar Legislative Assembly from Jhanjharpur constituency in the district of Darbhanga for which election was held in the months of January to Match, 1957. One of the four candidates Deonandan Jha, retired from the contest on the 4th of February, 1957, and only three candidates were left in the field, one of whom was the petitioner, Ramchandra Mishra.
The appellant, Deochandra Jha was declared elected at the counting of votes on the 25th March, 1957, as having secured the largest number of votes.
Ramchandra Mishra filed an election petition challenging the validity of the election under Clauses (d) and (e) of Section 7 of the Representation of the People Act, 1951.
The main allegations against him, were that he held several contracts with the Government of Bihar for the execution of works which were still subsisting when scrutiny of the nomination papers was made. He was also a proprietor of a firm Basant Lal Deochandra Jha which also held an office of profit under the Government through the Grow More Food Department as stockists and distributors of cement at Rajnagar. There was a contract for the construction of a portion of the Kamla Balan Embankment at village Bali Mehath dated the 8th of February, 1956.
The petitioner also alleged several corrupt practices having been resorted to by the appellant in course of the election in the form of carrying voters of different villages to different booths in his own tractor with trailer and bullock cart. He also procured jeep tire cart etc., for carrying the voters from their homes to the polling booths all of which were specified in detail in the election petition.
There were other allegations as well of corrupt practices, but it is unnecessary to set out inasmuch, as they have not been found to have been substantiated by the Election Tribunal and they have not been pressed before us by the learn-
ed Counsel for the respondent.
2. The appellant admitted to be the proprietor of the firm Basant Lal Deochandra Jha. According to him, this firm has two kinds of business, one of which was to act as stockists of food grains, and the other to act as stockists of cement. He had interest in the grain business but not in the cement business which was the sole concern of Basant Lal Kejriwal. He also alleged that although he had connection with the grain business at one time, he ceased to have any concern with that before the filing and scrutiny of his nornina-
tion paper.
As to the Kamla Balan Embankment, it was alleged that the contract was only for three months and the work was completed before the outbreak of rains in 1956, and it was not subsisting at the time of the filing of the nomination papers. This particular contract was entered into by him not in his personal capacity for any pecuniary benefit for himself but that the contract was entered into with the Government by the Mahath Gram Pan-
chayat of which he happened to be Mukhia at the time of the execution of the agreement. He had no concern with this work after the election of the new Mukhia in May 1956 when he made over charge to him and handed over the papers in connection with this contract to the Gram Sewak, Sukhdeo Yadav. Other allegations in the plaint with regard to contract and corrupt practices were also denied.
3. The Election Tribunal of Darbhanga has accepted the case of the appellant on all matters except with regard to the appellant's interest in the firm Basant Lal Deochandra Jha acting as stockists of foodgrain as also stockists and distributors of cement. According to the Tribunal, the candidature of the appellant was vitiated under Section 7(d) as it stood before its amendment inasmuch as he must be held in the circumstances to have interest in the contract for the execution of any work or performance of any service or per-formance of any services undertaken by, the Government of Bihar. The respondent, Ramchandra Mishra, has preferred a cross-objection to the finding of the Tribunal to the effect that the appellant entered into contract with the Government of Bihar in regard to the Kamla Balan Embankment as the Mukhia of the Mahath Gram Pan* chayat, and further that that interest also ceased after the election of the new Mukhia which took place in 1956 before the appellant filed his nomination paper for election as a member of the Bihar Legislative Assembly.
4. Learned Counsel for the appellant has drawn our. attention to the findings of the 'Court below which I have mentioned above. They are all in favour of the appellant except in regard to two matters set out above. The learned Counsel has also drawn our attention in this connection to an unreported decision by their Lordships of the Supreme Court in the case of Rampadarath Mahto v. Mishri Singh, D/- 17-11-1960 in Civil Appeal No. 388 of 1960 : (AIR 1961 SC 480). That appeal went up to the Supreme Court from a decision of this Court which allowed the appeal against the decision of the Election Tribunal of Darbhanga. The Supreme Court allowed the appeal against the decision of this Court and held that the nomination paper of the appellant, Rampadarath Mahto, was not validly rejected and, as such, the election of the successful candidate, Mishri Singh, was affected thereby and the election was set aside and it was observed that the election could not be sustained in the circumstances of the case. The nomination paper of Rampadarath Mahto was rejected in the circumstances similar to those found in the present case inasmuch as he too was a person holding an interest in a contract with the State of Bihar by acting as a stockist of grain entrusted to him by the Government under a contract under which he was entitled to get certain commission from the sales of the grain from time to time. The Supreme Court has decided that the contract for stocking and storing of goods was not a contract for rendering service of supplying and selling them to the residents of the place, and if that be not so, the contract would not attract the provisions of Section 7(d) and would not affect the candi-dature of a person either to the State Legislature or to the Central Legislature, as the case might be. Mr, K. P. Verma appearing for the respondent, has found it difficult to support the judgment of the Tribunal on this matter, and he fairly conceded that the above conclusion cannot be upheld that the appellant came within the mischief of Section 7(d) of the Representation of People Act, and accordingly that finding must be set aside.
5. Mr. Balbhadra Prasad Singh, appearing for the appellant, has urged that the above decision of the Supreme Court might also cover the other contract in regard to the stocking of cement; but that question would not arise in the present case inasmuch as the position of the appellant is not that of a contractor but that of a mere licensee. Section 7(d) in terms contemplates the existence of a contract between the candidate and the Gov-
ernment. Where, therefore, there is no contract as such, the candidature of a person. cannon be held to be affected by Section 7(d). Section 7(d) runs as follows;
"A person shall be disqualified for being chosen as, and for being, a member of either House of Parliament or of the Legislative Assembly or Legislative Council of a State-
(d) if there subsists a contract entered into in the course of his trade or business by him with the appropriate Government for the supply of goods to, or for the execution of any works undertaken by, that Government;''.
It is clear, therefore, that reference is made in the section to a contract, and the relationship between the Government and the candidate must be one which postulates the mutuality of obligation between the parties. Where, however, the position is not one of mutuality, but only one of a grant of a license by the Government in favour of the person seeking to set up his candidature, Section 7(d) fa terms will not apply. The contention appears to be correct and is supported by a number of decisions of various Election Tribunals : Dr. Kannabhiran v. A. J. Arunachalarn, 2 Ele LR 167, Harish Chandra v. Raja Man Singh. 5 Ele LR 129, Hanuman Prasad Misra v. Tara Chand, 5 Ele LR 446, Chiranjit Singh v. Mam Raj, 7 Ele. LR 1.
The case reported in 5 ELR 129 was a case of supply and distribution of sugar. This was governed by the Sugar and Gur Control Order, 1950, made by the Government, of India in the exercise of the powers conferred by Section 3 of the Essential Supplies (Temporary Powers) Act, 1946. The Tribunal held that the license which was granted to the petitioner in that case could not be considered to be a contract for the performance of service undertaken by the Rajasthan Government. In a contract contemplated under Section 7(d) there is a mutuality between the parties. In that case there was no such mutuality. What was granted to the petitioner was a license to distribute sugar to ration-card holders according to law, and in order to see that the sugar was properly distributed certain undertakings were taken from him which found place in the security bond. The Government, of Rajasthars undertook no duty towards the petitioner. The distinction between a license find a contract was explained in that case. It was laid down that a license was not a contract between the State and the licensee and was not property in any constitutional sense. The same principle has been reiterated in the other decisions, hut the contrary view is sought to be supported by Mr. K. P. Varma on behalf of the respondent. In fact, he is not supported by any authority to which our attention was drawn as in all of them, there was a regular contract implying mutuality between the State and the other party. There can be no doubt, therefore, that where there is merely a license, Section 7(d) of the Act cannot be invoked.
6. Learned Counsel for the respondent has endeavoured to show that in the present case there was a contract and not merely a license for the distribution of cement, because the appellant was not free to sell it to any and every permit holder, but he merely supplied cement which was to be supplied to the Grow More Food Department. There is, however no evidence on record in support of this contention. The position, therefore, remains that the appellant was merely a stockist of cement and was bound to supply cement available in the stock to any permit-holder authorised by the proper authority to purchase cement from the firm of which he was the proprietor. I am unable to see anything which might give rise to a contractual obligation between the State of Bihar and the appellant in regard to the business of stocking of cement. The appellant must, therefore, bo held to be a mere licensee in respect of this business as well, and none of the decisions to which reference has been made by Mr. Varma can be of any avail in resisting the conclusion that the appellant was a licensee pure and simple, and, as such, this case is not hit by Section 7(d).
7.* * * * * (After narrating the evidence of A. W. 6 and A. W. 10 His Lordship proceeded). It is urged on behalf of the appellant that in view of the statements of the above two witnesses and in view of the fact that the stockists are appointed without any agreement executed by them, it is clear that there was no contract between the Government and the appellant, or for the matter of that with the firm Basant Lal Deochandra [ha, and the appellant cannot, therefore, be regarded as a person having entered into a contract with the Government. Exhibit 16 is a letter from the District Agricultural Officer to Messrs. Martin Burn Limited which only indicates that the firm Messrs. Basant Lal Deochandra Jha, Jhanjharpur were nominated cement stockists, and that cement might be supplied to them on their depositing the necessary advance on demand by Messrs. Martin Burn Limited. Exhibit 16 (a) also refers merely to the nomination of the firm Basant Lal Deochandra Jha as stockist of cement. In the circumstances, the oral and documentary evidence referred to also fortify the conclusion recorded above that the appellant was merely granted a license and there was no contract-between him and the Government in any sense of the term.
8. In view of these findings both with regard to the position of the appellant as stockist of food-grain as also as stockist of cement neither of which has been held to bring the appellant within the mischief of Section 7 (d) of the Act, the judgment of the Tribunal cannot be sustained.
9. Mr. K. P. Varrna, however, has also preferred a cross-objection against the finding of the Tribunal with regard to the Kamla Balan Scheme concerning the construction of a portion of the embankment on the river. The Tribunal has held that the appellant could not be prejudiced by this contract with the Government of Bihar inasmuch as this contract was entered into by him not in his personal capacity, but as the Mukhia of Mehath Gram Panchayat, Mr. Verma has urged that if the position were as has been assumed by the Tribunal that the appellant entered into the contract for construction of the embankment as Mukhia. then in view of the decision in Bhagwan Singh v. Rameshwar Prasad, AIR 1959 SC 876, the appellant in fact would not be affected by this contract and his candidature could not be vitiated. As it is, however, on the facts and circumstances of this case, it must be held that the appellant did not enter, into the contract as a Mukhia at all. When the agreement was executed in the year 1954, there was no Gram Panchayat under the Bihar Parichayat Raj Act. Although he was characterised as a Mukhia, the appellant entered into the contract in his personal capacity, and even after the formation of the Panchayat under the Bihar Panchayat Raj Act in 1956, when another Mukhia was elected, the appellant did not make over charge of the scheme for the execution of which he entered into a contract with the Government, to the newly elected Mukhia. As a matter of fact, the appellant was executing the work in his personal capacity and for his own benefit. In that view of the matter he cannot avoid the consequences of holding a contract with the Government on the ground that he was doing so as the Mukhia of a Gram Panchayat. The Tribunal has carefully scrutinised the position and has recorded a finding against the respondent not only on the ground of the contract having been entered into by Deochandra Jha as Mukhia of the Gram Panchayat, but also on the ground that at the time when the appellant filed his nomination paper, he had definitely no concern with the contract because he had ceased to be a Mukhia. The Tribunal has carefully scrutinised the position and held as follows :--
"it would thus appear that although the respondent No. 1 had actually entered into the contract with the Government for the construction of a portion of the Kamla Balan Embankment, he had no concern with the contract in his personal capacity and he ceased to have any concern with the contract in his official capacity also after the election of the new Mukhia in May, 1956, i. e., long before the filing of his nomination paper for the election in question. Hence the provisions of Section 7 (d) of the R. P. Act cannot be held no constitute any bar to his election so far as the contract relating to the Kamla Balan Embankment is concerned in view of the principles laid down by the Hon'ble Supreme Court in AIR 1959 SC 876."
Mr. Varma has endeavoured to challenge the soundness of this view on the ground that unlike the above case dealt with by the Supreme Court no accounts have been submitted by the appellant to show in what capacity he was working. In my opinion however, he cannot successfully impugne the correctness of the view of the Tribunal. The matter has been looked at in the first place from two possible angles. One of them should be whether in fact there was a contract with the Gram Panchayat of which the appellant happened to be the Mukbia duly constituted or not. There can be no doubt that the agreement ex facie purports to be on behalf of the Gram Panchayat. If, therefore, there was such a Gram Panchayat, the appellant is protected on account of his having been the Mukhia at the time the contract was entered into. If, however, in the alternative, there was no Gram Panchayait in existence, then the contract itself which purports to be with the Gram Panchayat would be non-existent, and the respondent could not be in a position to raise the question of a con-tract between the Government and the appellant. If, as a matter of fact, there was a contract, it was only the one which has been brought on record and it was between the Gram Panchayat and the Government for the construction of the embankment and not otherwise, Mr. Varma has contended that the position should not be affected by the apparent character of the agreement, but its substance should be looked into as was held by the Supremo Court in Chaturbhuj Vithaldas v. Moreshwar Pa-rashram, 9 Ele LR 301 at p. 318: (AIR 1954 SC 236 at p. 243) where a technical defect in the formation of the contract which was sought to be made the disquanfcation of the candidate rested upon non-compliance as required under Article 299 of the Constitution of India. The Supreme Court held that in spite of such a defect, it is the substance which matters, and if there was such a contract, even if technically defective, the matter would come within the purview of Section 7 (d) of the Representation of the People Act. In my opinion, however, the consideration of technical defect which weighed with the learned Judges of the Supreme Court does not arise in this case. Here there is no question of technical defect affecting the agreement. It is only a question of giving effect to what the agreement purports to be, and under it the question of personal capacity of the appellant does not arise. There is not a trace anywhere in the agreement to show that the appellant entered into a personal contract in any shape or form. In my opinion, therefore, it must be held that even if there was a provisional corporate body like the Gram Panchayat in 1954 which subsequently came to be a regularly constituted body under the Bihar Panchayat Raj Act of 1947 and another Mukhia took the place of the appellant as having been duly elected, the work executed must be taken to have been done on behalf of the Gram Panchayat and not on behalf of the appellant in his personal capacity. In the result, therefore, it must be held that there is no substance in the cross-objection ' as well which must be dismissed.
10. The appeal is accordingly allowed, and the election of the appellant as a member of the Bihar Legislative Assembly must be held to be valid in law. The respondent, Ramchandra Mishra, must pay to the appellant Rs. 500/- as costs of the proceeding.
G.N. Prasad, J.
11. I agree.