Delhi High Court
Sh. Bakshish Singh Dhaliwal Thru ... vs Union Of India (Uoi) And Anr. on 20 March, 2007
Author: S K Kaul
Bench: S K Kaul
JUDGMENT
Sanjay Kishan Kaul, J.
1. The plaintiff, late Shri Bakshish Singh Dhaliwal, filed a suit for recovery against the Union of India as the first defendant and the State of Punjab as the second defendant. The original claim was much larger but in terms of the amended plaint, the claim is confined to recovery of Rs.32,51,599/-.
2. The plaint sets out that in the year 1944-45 the plaintiff was engaged in contractual works for CPWD on a large scale. The plaintiff was, however, arrested under the defense of India Rules by the Punjab Police on 12.4.1944. He was released by the High Court of Judicature at Lahore but was soon re-arrested on 26.4.1944 under the provisions of Section 420 IPC. The origination of the complaint was in respect of the works carried out by the plaintiff in respect of a contract at Burma. Searches were carried out at the house of the plaintiff and cash amount of Rs.5.00 lacs, 6 trucks and one Buick car of the plaintiff were seized under the provisions of Section 94 Cr.P.C. These vehicles are stated to have been sold at a nominal sum of Rs.18,500/- on account of improper maintenance by the police authorities.
3. The principal cause arose on 23.10.1944 when the Deputy Superintendent of Police, Mr.Tek Singh, moved an application before the Court of the District & Sessions Judge, Jullundur under Section 3 of the Criminal Law Amendment Ordinance No. xxxviii of 1944 (hereinafter referred to as the said Ordinance) to attach the properties of the plaintiff. Thus, various amounts due to the plaintiff as also the deposits of the plaintiff with banks were attached. The plaintiff has claimed the amount so attached apart from business losses. The plaintiff has also claimed interest @ 9% per annum.
4. The plaint further states that the plaintiff was prosecuted criminally which resulted in his conviction and finally on 31.8.1966 a fine of Rs.1,51,800/- was imposed by the Supreme Court of India. It is, thus, stated that that was the only amount which the defendants will be legally entitled to and the excess amount attached was illegal and unjustified.
5. The Union of India in the written statement claimed that the suit was not maintainable and that the plaintiff is claiming the same relief in the proceedings initiated before the District Judge, Jullundar under the said Ordinance. The plaintiff had been charged for cheating by making representations to the Government of Burma and wrongly obtaining payments of money including payments in respect of works which had not been carried out by the plaintiff as the contractor. The allegations against the plaintiff were found to be correct right till the highest Court and the Supreme Court had only modified the compulsory fine in respect of one charge and reduced it from Rs.1,08,400/- to Rs.54,200/-. The attachment of various properties and the value thereof have also been set out in the written statement.
6. Defendant No. 2, State of Punjab, also contested the suit taking almost similar pleas.
7. On the pleadings of the parties, the following issues were framed on 11.5.1972:
1. Whether the plaint does not disclose a cause of action?
2. Whether the suit of the plaintiff is barred under Section 17 of the defense of India Rules, 1939?
3. Whether the suit of the plaintiff is barred under Clauses 14 and 15 of the Criminal Law (Amendment) Ordinance, 1944?
4. Whether the notice under Section 80 CPC served on the defendants is invalid?
5. Whether the suit of the plaintiff is within limitation?
6. Whether the seizure of the properties mentioned in paragraph 4 of the plaint was illegal, mala fide or wrongful?
7. Whether the defendants did not take reasonable care of the seized property and wrongfully sold the same? If so, to what effect?
8. Whether the attachment of the properties (mentioned in paras 5, 10 and 11 of the plaint), under Ordinance 38 of 1944 was illegal, mala fide or wrongful? If so, is the plaintiff entitled to compensation or return of those properties?
9. Whether the plaintiff suffered any losses in the business by reason of the seizure of the vehicles? If so, whether the defendants are liable for those losses?
10. If answer to issue No. 9 is in the affirmative then to what amount of damages is the plaintiff entitled on this account?
11. Whether the plaintiff is entitled to damages on account of various wrongful and illegal acts of the defendants? If so, to what amount of damages the plaintiff is entitled?
12. Whether the plaintiff is entitled to interest? If so, at what rate, for what period and to what amount?
13. Relief.
8. The written statement of defendant No. 2 was amended and, thus, on 11.1.1978 the following further issues were framed:
13. Whether the suit of the plaintiff is barred because the plaintiff earlier in 1946 had moved the court of District Judge, Jullundur, for the restoration of the property attached in pursuance of the Ordinance No. 38 of 1944? OPD Punjab State.
14. Whether the attachment of the properties of the plaintiff was effected in pursuance to a judicial order? If so, what is its effect? OPD Punjab State.
15. Whether the defendants are liable in tort for the actions of its employee? OPP.
16. Whether the defendants are not vicariously responsible for the tort, if any, committed by its employee? OPD.
17. Whether the defendants are not liable for the tort committed by the employees of the Crown? OPDefendants.
18. Whether the defendants failed to furnish security before attachment of the property? If so, what is its effect? OPDefendants.
19. Whether this Court has jurisdiction to try the suit? OPP.
20. Whether the objection raised by the defendants are vague? If so, what is its effect? OPP.
21. Whether the suit is barred under the provisions of Order 2 Rule 2 of the CPC? OP Defendants.
22. Relief.
9. Issues No. 1 to 5 were directed to be tried as preliminary issues on 11.5.1972.
10. In terms of the order dated 29.11.1973 issues No. 1, 4 & 5 were answered in favor of the plaintiff while issues No. 2 & 3 were directed to be tried with other issues.
11. Both the parties have led their respective evidence. The plaintiff produced Mr.Hazara Singh, PW1 as his witness apart from examining himself as PW2. Defendant No. 1 did not examine any witness while defendant No. 2 examined 5 witnesses. The first two witnesses are relevant only on the issue of the claim of pauperism of the plaintiff and are, thus, not required to be gone into at this stage. The evidence of DW3 was cancelled with the consent of the parties and DW4 and DW5 only appeared on the issues of attachment of properties.
12. On 9.4.1987 learned Counsel for the plaintiff gave up all other claims for recovery other than as made in para 5(A) for an amount of Rs.4,61,599/-.
13. In the written statements of the defendants, the amount which has been admitted is Rs.4,54,600/-. In addition it was agreed during the submissions that the sale proceeds of six trucks and buick car of Rs.18,500/- are also due to the plaintiff. The amount thus totals to Rs.4,73,100/-. For convenience of reference, the chart of the claims under different heads is reproduced as under:
Sl. Item Plaint (Para 5A) Written Statement Written Statement
No. (Defendant No. 2) (Defendant No. 1)
1. Recovered by police
from Bawa Dan Singh 2,84,000 2,84,000 2,84,000
2. Received by police
from Mr. D.R. Sanon 50,000 50,000 50,000
3. Received by Police
from Ishar Singh at
Delhi 5600 5600 5600
4. Fixed Deposit with
CPWD Delhi 55,123 50,000 50,000
(Security Deposit (Security Deposit
with CPWD) with CPWD)
5. Bill with CPWD, Delhi 18,737 --- ---
6. Bank Balance attached
with the Punjab
National Bank Ltd.,
Sadar Bazar, Delhi 14,639 ---- ----
7. Sale Produce (proceeds)
of Six Trucks and Buick
Car 18,500 18,500 18,500
(agreed during (agreed during
submissions) submissions)
8. Balance of Fixed Deposit
with the Punjab National
Bank Ltd. out of the
Fixed Deposit of Rs.
3,00,000 15,000 15,000 15,000
Sum lying in Fixed Sum lying in Fixed
Deposit Deposit
9. Security Deposit in the
name of Chief Engineer,
CPWD and some amounts due
to the plaintiff from
PWD --- 50,000 50,000
TOTAL 4,61,599 4,73,100 4,73,100
13. It is not necessary to go into a detailed scrutiny of evidence in this behalf, especially in view of the agreement arrived at between learned Counsel for the parties during their submission that the amount can be accepted as Rs.4,73,100/-. The only evidence led was of the plaintiffs own statement, while defendant No. 2 produced some evidence of two witnesses only to substantiate the document that had been filed. Even otherwise on the basis of evidence available, this is the conclusion which would have been arrived at. Thus, the only question that arises is whether the plaintiff is entitled to this amount or any lesser amount.
14. Learned Counsel for the plaintiff contended that the plaintiff is entitled to this amount along with interest @ 9% per annum.
15. Learned Counsel for the defendants, on the other hand, submitted that there are amounts released to the plaintiff from time to time on the request of the plaintiff for maintenance and other litigation expenses from the attached amount amounting to Rs.1,14,714/-. This is so set out in paragraphs 4 & 5 of the written statement of defendants No. 1 & 2. In replication, there is no specific denial and during the cross-examination of the late plaintiff when a suggestion was put in this behalf the plaintiff stated that he could not deny or admit the same unless receipts were produced and shown to him. This question was at that stage restricted to the sum of Rs.1,02,714.14. An amount of Rs.12,000/-, however, finds the reference in Civil Revision No. 1065/1974 titled as Bakhshish Singh Dhaliwal v. The State of Punjab and Anr., decided on 17.12.1976 (Ex.D17) totalling to Rs.1,14,714/-.
16. The second amount, which is sought to be adjusted by the defendants, is the fine imposed by the Supreme Court of Rs.1,51,800/- in terms of the judgment delivered on 31.8.1966.
17. The last plea raised by the defendants is that it was for the plaintiff to have moved the competent court under the said Ordinance for release of the amount and not through the filing of the present suit.
18. Learned Counsel for the plaintiff, on the other hand, has pleaded that this fine cannot be adjusted from the amount attached as the defendants failed to take action in accordance with law for recovery of the said amount. Learned Counsel referred to the judgment of the learned single Judge in Keshav Datta Misra v. State wherein it has been held that the limitation for levy (recovery) runs from the date of passing of the sentence and not from the date of any subsequent modification by a superior Court in view of the provisions of Section 70 of the Penal Code. Learned Counsel also relied on the judgment of the Apex Court in Palakdhari Singh and Ors. v. State of Uttar Pradesh and Anr. for the same proposition. It was held that the language of Section 70 prescribes the terminus a quo to the date of "passing of sentence" by the Court which passes such order and the filing of appeal or revision does not, unless specifically ordered, arrest the operation of the order of passing of the sentence of conviction. Thus, the limitation starts from the date of conviction by the trial court. For convenience of reference Section 70 is reproduced as under:
70. Fine leviable within six years, or during imprisonment - Death not to discharge property from liability. - The fine, or any part thereof which remains unpaid, may be levied at any time within six years after the passing of the sentence, and if, under the sentence, the offender be liable to imprisonment for a longer period than six years, then at any time previous to the expiration of that period; and the death of the offender does not discharge from the liability any property which would, after his death, be legally liable for his debts.
19. Learned Counsel further referred to the judgment of a Division Bench of the Bombay High Court in the case of Ramaswamy Iyer Agnellus Lawrence Gopalan v. The Union of India and Anr. for the proposition that the said Section 70 of the the Penal Code or any other provision of the said Code does not prescribe any procedure by which the fine has to be levied but only speaks of the period of limitation within which the fine imposed has to be levied. The procedure is provided in Section 386 Cr.P.C. and the rules framed there under. It was contended that the said procedure ought to have been followed which would require some overt or covert act on part of the competent authority to recover the amount. In the end, learned Counsel for the plaintiff referred to the judgment of the Apex Court in the case of Aditya Mass Communications v. APSRTC 2003 RLR, 108 to advance the proposition that under Section 34 CPC the rate of interest unless stipulated otherwise, is to be such that reasonably compensates the parties. Twelve per cent simple interest was deemed to be proper. Learned Counsel then submits that the claim of 9% interest is, in fact, on the lower side.
20. In the normal course of adjudication of suits, it is the requirement that an issue-wise decision must be given. However, the large number of issues framed in the present suit have become irrelevant and adjudication is not required in view of the limited claim made by the plaintiff in pursuance to the subsequent submissions made by his counsel and the admission on part of the defendants in respect of the amounts. Thus, the only question to be considered is whether the amounts are liable to be adjusted as claimed by the defendants or not from the admitted amount and as to whether this Court would be competent to pass a decree in view of the provisions of the said Ordinance.
21. In order to appreciate the aforesaid, provisions of the said Ordinance have to be referred to. The Ordinance was passed with the object of preventing the disposal or concealment of money or other property procured by means of certain offences punishable under the Indian Penal Code and was issued in pursuance to the powers conferred by Section 72 of the Government of India Act, 1935, as set out in the Ninth Schedule. An application for attachment of the property has to be made under Section 3 of the Ordinance. The relevant provision reads as under:
3. Application for attachment of property. (1) Where the Provincial Government has reason to believe that any person has committed (whether after the commencement of this Ordinance or not) any scheduled offence, the Provincial Government may, whether or not any Court has taken cognizance of the offence, authorise the making of an application to the District Judge within the local limits of whose jurisdiction the said person ordinarily resides or carries on his business, for the attachment under this Ordinance of the money or other property which the Provincial Government believes the said person to have procured by means of the offence, or if such money or other property cannot for any reason be attached, or other property of the said person of value as nearly as may be equivalent to that of the aforesaid money or other property.
22. Section 4 deals with the ad interim attachment and suffice to say that such attachment was made in the present case. Such an order was issued on 23.10.1944 by the court of the District Judge, Jullundar (Ex.P/1). Section 9 provides for the administration of the attached property including for safeguarding the same. Section 10 provides for the duration of the attachment and reads as under:
10. Duration of attachment. - An order of attachment of property under this Ordinance shall, unless it is withdrawn earlier in accordance with the provisions of this Ordinance, continue in force--
(a) where no Court has taken cognizance of the alleged scheduled offence at the time when the order is applied for, for three months from the date of the order under Sub-section (1) of Section 4 or Sub-section (2) of Section 6, as the case may be, unless cognizance of such offence is in the meantime so taken, or unless the District Judge on application by the agent of the Provincial Government thinks it proper and just that the period should be extended and passes an order accordingly; or
(b) where a Court has taken cognizance of the alleged scheduled offence whether before or after the time when the order was applied for until orders are passed by the District Judge in accordance with the provisions of the Ordinance after the termination of the criminal proceedings.
23. A reading of Clause (b) of Section 10 of the said Ordinance would show that the relevant orders have to be passed by the District Judge after the termination of the criminal proceedings. As to how the property has to be disposed on termination of a criminal proceedings (in the present case the proceedings have been terminated) is provided for in Section 13, which reads as under:
13. Disposal of attached property upon termination of criminal proceedings. -- (1) Upon the termination of any criminal proceedings for any scheduled offence in respect of which any order of attachment of property has been made under this Ordinance or security given in lieu thereof, the agent of the Provincial Government shall without delay inform the District Judge, and shall where criminal proceedings have been taken in any Court, furnish the District Judge with a copy of the judgment or order of the trying Court and with copies of the judgments or orders, if any, of the appellate or revisional Courts thereon.
(2) Where it is reported to the District Judge under Sub-section (1) that cognizance of the alleged scheduled offence has not been taken or where the final judgment or order of the criminal Courts is one of acquittal, the District Judge shall forthwith withdraw any orders of attachment of property made in connection with the offence, or where security has been given in lieu of such attachment, order such security to be returned.
(3) Where the final judgment or order that from the property of the of conviction, the District Judge shall order that from the property of the convicted person attached under this Ordinance or out of the security given in lieu of such attachment, there shall be forfeited to His Majesty such amount or value as is found in the final judgment or order of the criminal Courts in pursuance of Section 12 to have been procured by the convicted person by means of the offence, together with the costs of attachment as determined by the District Judge : and where the final judgment or order of the criminal Court has imposed or upheld a sentence of fine on the said person (whether alone or in conjunction with any other punishment), the District Judge may order, without prejudice to any other mode of recovery, that the said fine shall be recovered from the residue of the said attached property or of the security given in lieu of attachment.
(4) Where the amounts ordered to be forfeited or recovered under Sub-section (3) exceed the value of the property of the convicted person attached, and where the property of any transferee of the convicted person has been attached under Section 6, the District Judge shall order that the balance of the amount ordered to be forfeited under Sub-section (3) together with the costs of attachment of the transferee's property as determined by the District Judge shall be forfeited to His Majesty from the attached property of the transferee or out of the security given in lieu of such attachment; and the District Judge may order, without prejudice to any other mode of recovery, that any fine referred to in sub-section shall be recovered from the attached property of the transferee or out of the security given in lieu of such attachment.
(5) If any property remains under attachment in respect of any scheduled offence or any security given in lieu of such attachment remains with the District Judge after his orders under Sub-sections (3) and (4) have been carried into effect, the order of attachment in respect of such property remaining shall be forthwith withdrawn, or as the case may be, the remainder of the security returned, under the orders of the District Judge.
24. A reading of the aforesaid provision shows that upon termination of the criminal proceedings (which occurred in the present case on 31.8.1966), the agent of the Provincial Government "shall" "without delay" inform the District Judge and furnish to the District Judge a copy of the judgment or order. The undisputed position in the present case is that no such action was taken by the State Government on termination of the criminal proceedings. If such an action would have been taken, the excess amount lying attached would have been released to the plaintiff.
25. Section 14 deals with the bar to other proceedings and reads as under:
14. Bar to other proceedings. - Save as provided in Section 11 and notwithstanding anything contained in any other law, -
(a) no suit or other legal proceeding shall be maintainable in any Court -
(i) in respect of any property ordered to be forfeited under Section 13 or which has been taken in recovery of fine in pursuance of an order under that section, or
(ii) while any other property is attached under this Ordinance, in respect of such other property, -
by any person upon whom a notice has been served under Section 4 or Section 6 or who has made an objection under Sub-section (4) of Section 4; and
(b) no Court shall, in any legal proceedings or otherwise, pass any decree or order, other than a final decree in a suit by a person not being a person referred to in Clause (a), which shall have the effect of nullifying or affecting in any way any subsisting order of attachment of property under this Ordinance, or the right of the District Judge to hold security in lieu of any such order of attachment.
26. It is the plaintiff who filed an application under Section 13 of the Ordinance (Ex.D-C) in April, 1967 making a prayer that the attachment on his properties be lifted and all cash after deducting the payment made to him be paid back to him. It was prayed that since the sum of Rs.1,51,800/- had become time-barred, the same could not be recovered, but if the same was held entitled to be recovered, the same be recovered out of the cash and the balance be paid to him. This application came to be decided by the District Judge, Jullundar in terms of a judgment dated 07.08.1974 (Ex. D-15). In the said order, one of the issues examined was the amount of Rs.6,000/- fine to be recovered from the plaintiff. The same was held to be time-barred in view of the judgment dated 23.05.1968 of R.P. Khosla, J. of the Punjab and Haryana High Court. Insofar as the compulsory fine of Rs.1,51,800/- was concerned, the same was held to be recoverable from the amounts attached of the plaintiff including the attached immovable property. It was held that since some amount may be lying in Pakistan, no recovery could take place from the same.
27. The plaintiff filed a revision petition before the Punjab and Haryana High Court being Civil Revision Petition No. 1065/1974 which came to be decided by an order dated 17.12.1976 (Ex.D-17). The order of the learned District Judge was partly reversed and it was held that the compulsory fine should be recovered from the amounts lying attached and the finding that the same should be recovered from the attached immovable property of the plaintiff was held to be not in accordance with law. It appears that the State of Punjab filed a Special Leave Petition, but no order has been placed on record. It has been orally stated that possibly the plaintiff died during the pendency of the same, his legal heirs were never brought on record and thus the petition was never prosecuted.
28. The position, which emerges from the aforesaid, is that the issue of recovery of Rs.1,51,800/- out of the amounts lying attached with defendant No. 2 became really final and it is not open for the plaintiff to plead that this amount has become time-barred since that issue came to be adjudicated in those proceedings. Undisputedly, the plaintiff never challenged those findings. In fact, learned Counsel for the plaintiff has not been really able to dispute this legal position and accepts that it is the balance amount which has to be paid to the plaintiff.
29. Insofar as the issue of the bar of legal proceedings is concerned, the object of Section 14 of the said Ordinance is to prevent adjudication by any other forum other than the forum as specified under the Ordinance. Two aspects are important. Firstly, defendant No. 2 took no steps as was required under Section 13 once there was termination of the criminal proceedings. This was the mandate for defendant No. 2. Secondly, it is the plaintiff who moved the application for release of the attached immovable property and the balance immovable property after deduction of the fine, if it was held within limitation. The concerned District Judge and thereafter the High Court adjudicated upon the matter to hold that the plaintiff was entitled to release of the attached immovable property. That happened in pursuance to the orders passed on 07.08.1974 by the District Judge as modified by the Punjab and Haryana High Court in terms of the Order dated 17.12.1976. Those proceedings also finally determined the question that the amount of compulsory fine had to be deducted from the attached amounts.
30. Learned Counsel for the defendants again have really not been able to dispute the aforesaid position.
31. The result of the aforesaid is that the plaintiff was entitled to an amount of Rs.4,73,100/- on account of the balance amount. From the said amount, it is found that an amount of Rs.1,14,714/- already stands paid to the plaintiff for maintenance and litigation expenses. A further amount of Rs.1,51,800/- has to be deducted towards compulsory fine. The balance amount, thus, held payable to the plaintiff is Rs.2,06,586/-.
32. Insofar as the issue of interest is concerned, the claim of the plaintiff is only for 9% p.a. interest. The plaintiff has drawn attention of this Court inter alia to the judgment in Aditya Mass Communication's case (supra) to substantiate that even 12% p.a. simple interest was held to be reasonable. Thus, 9% p.a. interest can hardly be held to be on the higher side. The question, however, arises as from which date the interest is liable to be paid.
33. The matter stood concluded by the judgment of the Apex Court on 31.08.1966. Defendant No. 2 ought to have filed an application under Section 13 of the Ordinance within reasonable period thereafter. Such reasonable period cannot be more than a period of four months for moving of the application and the orders on the same. Thus, I hold that the plaintiff is entitled to interest at least from 01.01.1967 since withholding of the amount thereafter was not proper.
34. A decree is passed in favor of the plaintiff and against defendant No. 2 in the sum of Rs.2,06,586/- along with simple interest @ 9% p.a. from 01.01.1967 till the date of payment. The plaintiff shall also be entitled to proportionate costs.
35. In the end, one cannot but note with deep regret the inability to really compensate the plaintiff truly in real terms. The value of the rupee has gone down drastically from 1967. No amount of interest can compensate the plaintiff for the amount which was certainly due to the plaintiff. The amount was originally attached in 1944. The initial criminal proceedings dragged on for quite some time and only culminated in 1966 and even thereafter the proceedings in the present suit have gone on since 1967. This is one case where truly delay has defeated justice.
