{"id":209882,"date":"1981-05-05T00:00:00","date_gmt":"1981-05-04T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/divisional-forest-officer-vs-bishwanath-tea-co-ltd-on-5-may-1981"},"modified":"2018-10-25T17:25:09","modified_gmt":"2018-10-25T11:55:09","slug":"divisional-forest-officer-vs-bishwanath-tea-co-ltd-on-5-may-1981","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/divisional-forest-officer-vs-bishwanath-tea-co-ltd-on-5-may-1981","title":{"rendered":"Divisional Forest Officer vs Bishwanath Tea Co. Ltd on 5 May, 1981"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Divisional Forest Officer vs Bishwanath Tea Co. Ltd on 5 May, 1981<\/div>\n
Equivalent citations: 1981 AIR 1368, \t\t 1981 SCR (3) 238<\/div>\n
Author: D Desai<\/div>\n
Bench: Desai, D.A.<\/div>\n
           PETITIONER:\nDIVISIONAL FOREST OFFICER\n\n\tVs.\n\nRESPONDENT:\nBISHWANATH TEA CO. LTD.\n\nDATE OF JUDGMENT05\/05\/1981\n\nBENCH:\nDESAI, D.A.\nBENCH:\nDESAI, D.A.\nMISRA, R.B. (J)\n\nCITATION:\n 1981 AIR 1368\t\t  1981 SCR  (3) 238\n 1981 SCC  (3) 238\t  1981 SCALE  (1)771\n CITATOR INFO :\n D\t    1983 SC 937\t (12)\n RF\t    1989 SC1076\t (21)\n\n\nACT:\n     Constitution of  India, 1950,  Article  226-Contractual\nobligations cannot  be enforced\t by the\t writ jurisdiction-A\ncompany, being\ta juristic  Person is not entitled to any of\nthe freedoms  guaranteed under\tArticle\t 19-Assam  Land\t and\nRevenue\t   Regulation-Settlement    Rule    37,-Scope\t of-\nInterpretation of clause 2 Part IV of Indenture lease.\n\n\n\nHEADNOTE:\n     Respondent\t Tea   Company\ttook   on  lease  land\tN.C.\nTezalpatty No.\t1 from the then Government. The lease was to\nbe exploited for cultivation and raising tea garden, and was\nsubject to conditions set out therein and generally to Assam\nLand and  Revenue Regulation  and the rules made thereunder.\nThe respondent\tcompany sought permission from the appellant\nto cut 7,000 cubic feet of timber from Grant N.C. Tezalpatty\nNo. 1  for utilising  the same\tfor building  of  staff\t and\nlabourers' house  as per  clause 2  of Part  IV of the lease\ndated 27-9-1932\t and Rule  37 of  the Assam Land and Revenue\nRegulations. Since  the timber\twas required  by the company\nfor use\t in Partabghur\tand Dekorai  tea estates  which were\noutside\t Tezalpatty  No.  1.  the  appellant  demanded\tfull\nroyalty on  timber cut, felled and removed. The company paid\nan amount of Rs. 7069.37 Paise under protest and later filed\na petition  under Article  226 of  the Constitution  in\t the\nAssam High Court, praying for refund of the amount and for a\nmandamus directing the appellant for issuing permits without\ninsisting on  payment of  royalty whenever  timber was to be\ncut from the leased area for the purposes connected with the\nexploitation of the grant.\n     The preliminary  objection raised by the appellant that\nsince the  right claimed  by the  respondent flowed from the\ncontract  of  lease  such  contractual\tright  can  only  be\nenforced in  civil court  and therefore\t cannot be gone into\nunder Article  226 was\trejected by the Assam High Court. On\nmerits, the  High Court\t further held  that as\tthe grant of\nN.C. Tezalpatty\t No. 1\twas in favour of the respondent, the\ncompany was  entitled to  cut, fell  and remove\t timber from\nthat grant  area for its use covered either by the same area\nor in  other tea  gardens which\t are outside  the grant. The\nHigh Court  made the rule nisi absolute and hence the appeal\nby special leave.\n     Allowing the appeal, the Court\n^\n     HELD:  1.\tThe  Writ  Petition  on\t the  allegation  of\ninfringement of\t fundamental right under Article 19(1)(g) of\nthe Constitution,  at the  instance  of\t respondent  company\nalone was  not maintainable  for the  reasons  that:  (a)  a\njuristic person such as a corporation is not entitled to any\nof the\tfreedoms guaranteed  by\t Article  19  and  here\t the\nrespondent is  a company  incorporated under  the  Companies\nAct; (b) Article 19(1)(g) guaranteed the fundamental freedom\nto a\n663\ncitizen and  the respondent being a company is not a citizen\nand (c)\t the shareholders of a company alone can complain of\ninfringement of their fundamental rights. [669 E-H, 670 A-C]\n     Tata Engineering  and Locomotive Co. v. State of Bihar,<\/a>\n[1950] S.C.R.  869, State  Trading Corporation of India Ltd.\nv. The\tCommercial Tax\tOfficer,  Vishakhapatnam,<\/a>  [1964]  4\nS.C.R. 99  and Benuott Coleman and Co. and other v. Union of\nIndia and others, [1973] 2 S.C.R. 757, followed.\n     2:1.It is\tundoubtedly true  that the  High  Court\t can\nentertain in  its extraordinary\t jurisdiction a\t petition to\nissue any  of the  prerogative writs  for any other purpose.\nBut such  writ can be issued where there is executive action\nunsupported by law or even in respect of a Corporation where\nthere is a denial of equality before law or equal protection\nof law.\t The Corporation  can also  file a writ petition for\nenforcement of\ta right\t under a  statute. Here,  the relief\nclaimed by  the respondent was referable to nothing else but\nthe terms  of lease, namely, clause 2 Part IV. The fact that\nthis term  is a\t mere reproduction  of proviso to Rule 37 of\nAssam Land  and Revenue\t Local Rate  Regulation but  that by\nitself is not sufficient to contend that what the respondent\nwas doing  was enforcing a statutory provision. The validity\nof regulations\tis not challenged. Therefore, the demand for\nroyalty is supported by law. [670 C-F]\n     2:2.  Ordinarily,\t where\ta   breach  of\tcontract  is\ncomplained of,\ta party\t complaining of\t such breach may sue\nfor specific performance of the contract, if the contract is\ncapable of  being specifically\tperformed, or  the party may\nsue for\t damages. Such a suit would ordinarily be cognizable\nby the\tCivil Court.  The High\tCourt in  its  extraordinary\njurisdiction  would  not  ordinarily  entertain\t a  petition\neither for specific performance or for recovering damages. A\nright to relief flowing from a contract has to be claimed in\na civil\t court where  a suit  for  specific  performance  of\ncontract or  for damages  could be  filed. Here,  this was a\nsuit for  refund of  a royalty\talleged to be unauthorisedly\nrecovered and  that could  hardly be entertained in exercise\nof the writ jurisdiction of the High Court. [670 F-G, 671 A-\nG, 672 A]\n     Har Shankar  and Ors.  etc. v.  The Deputy\t Excise\t and\nTaxation  Commissioner\t and  ors.,  [1975]  3\tS.C.R.\t254,\napplied.\n     Woodcrafts\t Assam\tv.  Chief  Conservator\tof  Forests,\nAssam, AIR<\/a> 1971 Assam p. 92, approved.\n     3:1. Upon\ta true\tconstruction of\t clause 2 Part IV of\nindenture of  lease, the respondent company was not entitled\nto remove  timber without  payment of  royalty. The specific\nprovision is  that the grant is for a purpose of cultivation\nand raising tea garden and that from the area covered by the\ngrant, if  timber is  felled for  purpose connected with the\ngrant itself,  namely, cultivation and raising tea garden in\nthat area,  then alone\tthe benefit  of\t removal  of  timber\nwithout payment of royalty can be availed of. [673 G-H., 674\nA]\n     3:2. In  order to\tobtain relief,\tnamely\tto  cut\t and\nremove timber  from lease  area for  purpose connected\twith\nexploitation, of  the grant  the company  must show that the\ntimber is  being felled\t and cut from an area covered by the\nlease in\n664\nwhich clause 2 finds its place and that such timber is being\nremoved for  a purpose\tconnected with\tthe exploitation  of\ngrant. To  be more specific, following facts will have to be\nproved for  obtaining relief:  (i) the\tarea covered  by the\ngrant; (ii)  felling of\t the trees  from the area covered by\nthe grant;  (iii) use  to which\t the felled timber was to be\nput to; (iv) such use will have to be one connected with the\nexploitation  of   the\tgrant\tand  (v)   meaning  of\t the\nexploitation of\t the grant,  when controverted these aspects\nwill have  to be  proved by  relevance.\t And  that  was\t the\nsituation when\treturn was filed by the present appellant in\nthe High Court. [672 G-H, 673 A-D]\n\n\n\nJUDGMENT:\n<\/pre>\n
     CIVIL APPELLATE  JURISDICTION: Civil  Appeal No. 218 of
\n1970.\n<\/p>\n
     Appeal by\tspecial leave  from the\t judgment and  order
\ndated the  10th September,  1968 of  the Assam\tand Nagaland
\nHigh Court in Civil Rule No. 56 of 1967.\n<\/p>\n
     S.K Nandy for the Appellant.\n<\/p>\n
     S.N. Chowdhary for the Respondent.\n<\/p>\n
     The Judgment of the Court was delivered by
\n     DESAI, J.\tThis appeal by special leave arises out of a
\nwrit petition  filed by\t the respondent\t Bishwanath Tea\t Co.
\nLtd., in  the Assam  and Nagaland High Court questioning the
\naction of  the appellant,  the\tDivisional  Forest  Officer,
\nDarrang Division,  of recovering  Rs. 7069.37  p. as royalty
\nfor cutting  and felling  trees from  Tezalpatty grant No. 1
\nheld under  lease  dated  September  27,  1932,\t and  for  a
\nmandamus directing  the appellant  to issue  permits without
\ninsisting upon\tpayment of  royalty for\t the trees  cut\t and
\nfelled from the area under lease.\n<\/p>\n
     Respondent\t Bishwanath  Tea  Co.  Ltd.  (‘Company’\t for
\nshort) took on lease land admeasuring 1107.26 acres from the
\nGovernment. The\t lease was  executed between the Company and
\nthe Secretary of the State for India. The lease in the first
\ninstance was  for a period of 15 years commencing from April
\n1, 1932.  The lease  was to be exploited for cultivation and
\nraising tea  garden. The lease was subject to conditions set
\nout  therein   and  generally  to  Assam  Land\tand  Revenue
\nRegulation and\tthe rules  made thereunder.  On February 15,
\n1966,  manager\tof  the\t Company  approached  the  appellant
\nseeking permission  to cut  7000 cubic\tfeet of\t timber from
\nGrant  N.C.  Tezalpatty\t No.  1\t of  Nagshankar\t Mouza,\t for
\nutilising the  same for\t building of  staff  and  labourer’s
\nhouses. By  the reply  dated April  4, 1966,  the  appellant
\nnoted that the timber was to be
\n665<\/span>
\ncut for\t constructing houses  in Partabghur  and Dekorai Tea
\nEstates and  that it  was necessary to ascertain whether any
\nof the\taforementioned two  Tea estates\t was situated within
\nthe grant  evidenced by\t lease of  N.C. Tezalpatty No. 1. It
\nwas made  clear that  if it was not so, full royalty will be
\npayable by  the company\t for cutting,  felling and  removing
\ntimber. The  manager by\t his letter  dated April  23,  1966,
\ninformed the  appellant that as the lessee is Bishwanath Tea
\nCo. Ltd,  it can  cut and fell timber from any of its leased
\narea to\t be utilised for its purposes in any other division.
\nTherefore, the\tmanager suggested  that the  permit must  be
\nissued\twithout\t  insisting  on\t  payment  of  royalty.\t The
\nappellant by  his letter  dated May  12, 1966,\tinformed the
\nmanager\t that\tas  the\t timber\t was  required\tfor  use  in
\nPartabghur and\tDekorai tea  estates which  were not  within
\nN.C. Tezalpatty\t Grant No.  1 of Nagshankar Mouza from which
\ntimber was  to be  felled and  cut,  full  royalty  will  be
\npayable on  timber so  cut and\tremoved because it was to be
\nutilised for  the purpose  unconnected with  the grant.\t For
\nthis assertion the appellant relied upon a portion of clause
\n(2) of\tPart IV\t of the lease deed dated September 27, 1932.
\nCorrespondence\tfurther\t  ensued  between  the\tparties\t and
\nultimately the\trespondent company  paid an  amount  of\t Rs.
\n7069.37 p.  as and  by way of royalty under protest and then
\nfiled a\t petition under\t Article 226  of the Constitution in
\nthe High Court alleging that upon a true construction of the
\nrelevant clause\t of the\t grant as also proviso to Rule 37 of
\nthe Settlement\tRules as  the timber  was required  for\t the
\npurpose connected  with the  exploitation of  the grant, the
\ncompany as  lessee was\tentitled to  cut and  remove  timber
\nwithout payment\t of royalty  and, therefore, the recovery of
\nroyalty being  unsupported by  law, the appellant was liable
\nto refund  the same.  The company also prayed for a mandamus
\ndirecting the  present appellant  who was  respondent in the
\nHigh Court  for issuing permits without insisting on payment
\nof royalty  whenever timber  was to  be cut  from the leased
\narea for the purposes connected with the exploitation of the
\ngrant.\n<\/p>\n
     The appellant  filed his  return to  the rule issued by
\nthe High  Court. A preliminary objection was raised that the
\nright claimed  by the respondent flowed from the contract of
\nlease and  such contractual  rights and obligations can only
\nbe enforced in civil court. It was contended that apart from
\nthe fact  that interpretation  of the  contract of  lease is
\ngenerally not  undertaken by  the High\tCourt in exercise of
\nits extraordinary  jurisdiction under  Article 226,  it\t was
\nfurther\t contended   that  even\t if  interpretation  of\t the
\nrelevant clause\t of the\t lease\tas  alleged  on\t behalf\t the
\nrespondent finds favour with
\n666<\/span>
\nthe court, yet facts will have to be investigated before any
\nrefund could  be ordered  or a\tblanket injunction  could be
\ngranted for  all times\tto come\t against the  appellant from
\nperforming  his\t  duty,\t namely,   of  granting\t permit\t and
\nrecovering royalty.\n<\/p>\n
     The High  Court  overruled\t the  preliminary  objection
\nobserving that\tthe court  was not called upon to decide any
\ncomplicated question  of fact  and the question for decision
\nbefore the  Court was  whether the  company was\t entitled to
\nenforcement of\tits legal right under the proviso to rule 37
\nof Settlement  Rules. The  Court further  observed that even
\nthough part  of the  proviso to\t rule 37  of the  Settlement
\nRules was incorporated in the lease itself, nonetheless what
\nthe Court  had to  consider  was  the  interpretation  of  a
\nstatutory rule\tand that  is the function of the Court under
\nArticle 226. On merits the High Court held that as the grant
\nN.C. Tezalpatty\t No. I\twas in favour of M\/s. Bishwanath Tea
\nCo. Ltd.,  the company\twas entitled  to cut and fell timber
\nfrom N.C.  Tezalpatty grant  area for  its use\tin other tea
\ngardens, namely,  Partabghur and  Dekorai and  even  if\t the
\nlatter two gardens were outside N.C. Tezalpatty Grant No. 1,
\nyet they  being under  the ownership  and management  of the
\ncompany, felling  of trees  from the  area of  one grant for
\nutilisation at\tother places  would fall  within the  second
\npart of\t the proviso  to rule  37 in  that the\tfelling\t and
\nremoval of  timber was\tfor use\t not  unconnected  with\t the
\nexploitation of\t the grant  and, therefore,  the company was
\nentitled  to   fell  and  remove  timber  in  the  aforesaid
\nsituation without  payment of  royalty. In  accordance\twith
\nthis finding the High Court made the rule absolute, directed
\nrefund of  the\tamount\tpaid  under  protest  and  issued  a
\nmandamus directing  the appellant  to issue  permits to\t the
\nrespondent company without payment of royalty for removal of
\ntimber from  Tezalpatty Grant No. 1 for use in tea garden of
\nDekorai division  for exploitation  of tea plantation. Hence
\nthis appeal by special leave.\n<\/p>\n
     Unquestionably, the  rights and obligations between the
\nparties to  this appeal\t are governed  by the  terms of\t the
\nlease dated  September 27, 1932. Specifically the respondent
\nwho was\t a petitioner in the High Court claimed the right to
\nrelief under  Clause 2\tof Part IV of the indenture of lease
\nwhich reads as under:\n<\/p>\n
     “2.  The lessee  shall pay to the lessor as provided by
\n\t  rules for  the time being in force under the Assam
\n\t  Land and  Revenue Regulation\tfor all\t timber\t (if
\n\t  any) on the
\n667<\/span>
\n\t  demised lands cut down, removed or utilised by the
\n\t  lessee during the period of the lease.\n<\/p><\/blockquote>\n
\t       Timber valuation\t at reduced  rates estimated
\n\t  at  Rs.   12472.7  (Rupees  Twelve  thousand\tfour
\n\t  hundred and  seventy-two and annas seven only) was
\n\t  credited into\t the treasury  by  Challan  Nos.  43<\/span>
\n\t  dated the  24.2.32 The  lessee shall\tbe liable to
\n\t  pay timber  valuation at  full rates on all timber
\n\t  sold or removed for sale and on all timber removed
\n\t  for use unconnected with exploitation of the grant
\n\t  during the period of his lease or renewed lease.”\n<\/p><\/blockquote>\n
According to  the respondent, it would be entitled to remove
\ntimber cut and felled from the leased area without liability
\nto pay\troyalty for  its own  use irrespective\tof the\tfact
\nwhether such  timber was to be used outside the leased area,
\nbecause\t such\tuse  would   be\t in   connection  with\t the
\nexploitation of the grant and there is such a reservation in
\nthe grant  evidenced by\t the lease.  True it  is that if the
\ntimber is  felled and removed for purpose connected with the
\nexploitation of\t the grant,  there would  be no liability to
\npay the\t royalty. Such\ta positive  right is  claimed from a
\nnegative covenant  in the  lease. Clause 2 provides that the
\nlessee had  paid timber valuation at the reduced rate at Rs.
\n12472.7 on  24-2-32 The\t lessee according  to the respondent
\nwould be liable to pay timber valuation at full rates on all
\ntimber sold  or removed\t for sale  on all timber removed for
\nuse unconnected\t with exploitation  of the  grant during the
\nperiod of the lease or renewed lease. The implication of the
\nnegative covenant  would be  that if  timber is removed from
\nthe leased  area connected  with the  exploitation of grant,
\nthere would  be no  liability to pay royalty on such timber.
\nThe  respondent\t  claimed  to\tremove\ttimber\twithout\t the
\nliability to  pay royalty  in exercise of the right reserved
\nunder Cl. 2 thus interpreted. In para 5 of the Writ Petition
\nfiled by  the respondent  in the High Court, a reference has
\nbeen made  to the  aforementioned term in the lease deed. It
\nwas further  stated that  the respondent  paid\tthe  royalty
\nunder protest  which it\t was not liable to pay as the timber
\nwas urgently required for the purpose of the business of the
\nCompany in connection with the grant. These averments in the
\npetition would show that the respondent claimed the right to
\nremove timber  without the  obligation\tto  pay\t royalty  as
\nflowing from  the grant evidenced by the lease. Anticipating
\na possible  contention about  the jurisdiction\tof the\tHigh
\nCourt to entertain
\n668<\/span>
\na writ\tpetition for  enforcement of contractual obligation,
\nthe respondent\tcontended that\tthe levy  of royalty  had no
\nauthority  of\tlaw  and   that\t this  was  an\tunreasonable
\nrestriction on\tthe fundamental\t right of  the respondent to
\ncarry on  its trade.  This camouflage of contending that the
\nlevy of\t royalty was  not supported by law and that this was
\nan unreasonable\t restriction on\t the  fundamental  right  to
\ncarry on  trade successfully  persuaded the  High  Court  to
\nentertain the petition.\n<\/p>\n
     Shorn of  all embellishment  the relief  claimed by the
\nrespondent was referable to nothing else but the term of the
\nlease viz.  Cl. 2  Part IV.  Maybe, that this term is a mere
\nreproduction of\t proviso to Rule 37 of Assam and and Revenue
\nand Local  Rates Regulations,  but that\t by  itself  is\t not
\nsufficient to contend that what the respondent was doing was
\nenforcing a  statutory provision.  Proviso to  Rule 37 is an
\nenabling provision.  The relevant  portion  of\tthe  proviso
\nreads as under:\n<\/p>\n
\t  “Provided that  if any  person taking\t up land for
\n     special  cultivation  is  unwilling  to  pay  the\tfull
\n     royalty valuation\tof the timber as estimated, he shall
\n     have  the\t option\t of   paying  a\t  reduced  valuation
\n     representing only\tthe profit which is likely to derive
\n     from the  use of  the timber for the purposes connected
\n     with the  exploitation of\tthe grant.  If he  exercises
\n     such option,  he shall be liable to pay royalty at full
\n     rates on all timber sold, bartered, mortgaged, given or
\n     otherwise, transferred  or removed\t for transfer and on
\n     all  timber   removed  for\t use  unconnected  with\t the
\n     exploitation of  the grant\t during the  period  of\t his
\n     lease or renewed lease.”\n<\/p><\/blockquote>\n
A bare\tperusal of  clause 2  of Part IV of the indenture of
\nlease extracted\t hereinbefore and  the proviso\tto  Rule  37
\nwould at a glance show that the proviso enables a grantee to
\ntake benefit  of it  by fulfilling certain conditions namely
\nby paying  a reduced  valuation representing only the profit
\nwhich it  is likely  to derive\tfrom the  use of  timber for
\npurposes connected with the exploitation of the grant. It is
\nthus an\t enabling provision and the grantor of the lease may
\npermit this option to be enjoyed by the grantee. But whether
\nthat has  been done  or not is always a question of fact. If
\nthe precondition  is satisfied,\t the benefit  can be  taken.
\nThat again  is a  matter to  be worked out by the parties to
\nthe indenture  of lease.  In fact, clause 2 of the indenture
\nof lease would show that the respon-\n<\/p>\n
669<\/span><\/p>\n
dent grantee  paid Rs.\t124727\/- being\ttimber valuation  at
\nreduced rates.\tThe  respondent\t having\t made  the  payment,
\nwhereupon the  grantor of  the lease agreed that the grantee
\nwill have  to pay  timber valuation  at full  rates  on\t all
\ntimber sold  or removed\t for sale  and on all timber removed
\nfor use\t unconnected with  exploitation of  the grant during
\nthe period  of his  lease or  renewed lease  but the grantee
\nwill not  have to  pay royalty for timber felled and removed
\nfor purpose  connected\twith  the  grant.  It  thus  can  be
\ndemonstrably established  that the  respondent was trying to
\nenforce through the writ petition the right to remove timber
\nwithout the  liability to  pay royalty not under the proviso
\nto Rule\t 37 which  was merely an enabling provision, but the
\nspecific term  of  lease  agreed  to  between  the  parties.
\nProviso to  Rule 37  may not be incorporated in an indenture
\nof lease.  If incorporated after fulfilling pre-condition it
\nbecomes a  term of  lease. The\tHigh Court,  in our opinion,
\ntherefore, was in error in posing a question to itself as to
\nwhether the  applicant (respondent  herein) was\t entitled to
\nthe enforcement\t of legal right under the proviso to Rule 37
\nof the Settlement Rules. The camouflage successfully worked,
\nbut once  this cloak is removed, it unmistakably, transpires
\nthat the  respondent was trying to claim benefit of clause 2
\nof  the\t  lease\t having\t  fulfilled  its  pre-condition\t and
\nobtaining the  inclusion of  its latter part in the contract
\nof lease.  The question,  therefore, really  is whether such
\ncontractual  obligation\t  can  be   enforced  by   the\twrit
\njurisdiction? How  dangerous  it  is,  can  be\tdemonstrably
\nestablished in this case.\n<\/p>\n
     But we would first address ourselves to the question of
\nlaw. Art. 226 confers extraordinary jurisdiction on the High
\nCourt to issue high prerogative writs for enforcement of the
\nfundamental rights  or for  any other  purpose. Undoubtedly,
\nthe respondent\tcontended that\tits fundamental\t right under
\nArt. 19(1) (g) to carry on trade has been violated. The High
\nCourt overlooked  the well-settled  legal  position  that  a
\njuristic person such as a Corporation is not entitled to any
\nof the\tfreedoms guaranteed  by Art.  19. The respondent was
\nthe sole  petitioner in\t the High  Court. It  is  a  company
\nincorporated under  the Companies Act. The fundamental right
\nclaimed under  Art. 19 (1) (g) is to practise any profession
\nor  carry   on\tany   occupation,  trade  or  business.\t The
\nrespondent (company)  contended that it had a right to carry
\non its\ttrade or  business of  cultivating and raising a tea
\ngarden and  as part  of it to cut timber and remove the same
\nfrom the leased area without the payment of royalty and that
\ninsistence upon\t payment of royalty unsupported by law is an
\nunreasonable  restriction   denying  the  fundamental  right
\nguaranteed to the respondent. Art.\n<\/p>\n
670<\/span><\/p>\n
19 (1)\t(g) guarantees the fundamental freedom to a citizen.
\nThe respondent\tnot being  a citizen  was  not\tentitled  to
\ncomplain of  breach or\tviolation of fundamental right under
\nArt. 19\t (1) (g).  [See State  Trading Corporation  of India
\nLtd. v. The Commercial Tax Officer, Vishakhapatnam  and Tata
\nEngineering and Locomotive Co.<\/a> v. State of Bihar .] However,
\nthe shareholders  of a\tcompany can complain of infringement
\nof their  fundamental rights  [See Bennett Coleman & Co. and
\nothers v.  Union of  India and others<\/a>]. Such is not the case
\npleaded. Therefore  the writ  petition on  the allegation of
\ninfringement of\t fundamental right  under Art. 19 (1) (g) at
\nthe  instance\tof  respondent\t company   alone   was\t not
\nmaintainable.\n<\/p>\n
     It is undoubtedly true that High Court can entertain in
\nits extraordinary  jurisdiction a  petition to\tissue any of
\nthe prerogative\t writs for  any other purpose. But such writ
\ncan be issued where there is executive action unsupported by
\nlaw or\teven in\t respect of  a Corporation  where there is a
\ndenial of  equality before  law or  equal protection of law.
\nThe  Corporation   can\talso   file  a\t writ  petition\t for
\nenforcement of\ta right\t under a  statute.  As\tpointed\t out
\nearlier, the  respondent  (Company)  was  merely  trying  to
\nenforce a contractual obligation. To clear the ground let it
\nbe stated  that obligation to pay royalty for timber cut and
\nfelled\tand   removed  is   prescribed\t by   the   relevant
\nregulations. The  validity of regulations is not challenged.
\nTherefore, the\tdemand for  royalty is\tunsupported by\tlaw.
\nWhat the respondent claims is an exception that in view of a
\ncertain term  in the  indenture of  lease, to wit, Clause 2,
\nthe appellant  is not entitled to demand and collect royalty
\nfrom the  respondent. This  is nothing\tbut enforcement of a
\nterm of\t a contract  of lease.\tHence, the  question whether
\nsuch contractual  obligation can  be enforced  by  the\tHigh
\nCourt in its writ jurisdiction.\n<\/p>\n
     Ordinarily, where\ta breach  of contract  is complained
\nof, a  party complaining of such breach may sue for specific
\nperformance of the contract, if contract is capable of being
\nspecifically performed,\t or the\t party may  sue for damages.
\nSuch a\tsuit would  ordinarily be  cognizable by  the  Civil
\nCourt. The  High Court\tin  its\t extraordinary\tjurisdiction
\nwould  not   entertain\ta   petition  either   for  specific
\nperformance of\tcontract or  for recovering damages. A right
\nto relief  flowing from\t a contract  has to  be claimed in a
\ncivil  court  where  a\tsuit  for  specific  performance  of
\ncontract or for damages could be
\n671<\/span>
\nfiled. This  is so well settled that no authority is needed.
\nHowever, we  may refer\tto a  recent decision bearing on the
\nsubject. In  Har Shankar  and Ors.  etc. etc.  v. The Deputy
\nExcise and  Taxation Commissioner  and Ors., the petitioners
\noffered\t their\tbids  in  the  auctions\t held  for  granting
\nlicences  for\tthe  sale   of\tliquor.\t  Subsequently,\t the
\npetitioners moved to invalidate the auctions challenging the
\npower of the Financial Commissioner to grant liquor licence.
\nRejecting this\tcontention, Chandrachud\t J., as\t he than was
\nspeaking for  the Constitution Bench at page 263 observed as
\nunder:\n<\/p>\n
\t  “Those who contract with open eyes must accept the
\n     burdens of\t the contract  along with  its benefits. The
\n     powers of\tthe Financial  Commissioner to\tgrant liquor
\n     licences by auction and to collect licence fees through
\n     the medium\t of auctions  cannot by\t writ  petitions  be
\n     questioned by  those who,\thad their venture succeeded,
\n     would have\t relied upon  those very  powers to  found a
\n     legal claim.  Reciprocal rights and obligations arising
\n     out of  contract do not depend for their enforceability
\n     upon whether  a contracting  party finds  it prudent to
\n     abide by  the terms  of the contract. By such a test no
\n     contract could ever have a binding force.”\n<\/p><\/blockquote>\n
Again at page 265 there is a pertinent observation which may
\nbe extracted.\n<\/p>\n
\t       Analysing the  situation\t here,\ta  concluded
\n\t  contract must\t be held to have come into existence
\n\t  between the parties. The appellants have displayed
\n\t  ingenuity  in\t  their\t search\t  for\tinvalidating
\n\t  circumstances\t but  a\t writ  petition\t is  not  an
\n\t  appropriate  remedy\tfor  impeaching\t contractual
\n\t  obligations.”\n<\/p>\n
This apart,  it also  appears that  in a later decision, the
\nAssam High  Court itself  took an  exactly opposite  view in
\nalmost identical circumstances. In Woodcrafts Assam v. Chief
\nConservator of\tForests, Assam,<\/a>\t a writ\t petition was  filed
\nchallenging  the  revision  of\trates  of  royalty  for\t two
\ndifferent  periods.   Rejecting\t  this\t petition   as\t not
\nmaintainable, a\t Division Bench\t of the High Court held that
\nthe complaint  of the  petitioner is that there is violation
\nof his\trights under the contract and that such violation of
\ncontractual  obligation\t  cannot  be   remedied\t by  a\twrit
\npetition. That\texactly is  the position  in the case before
\nus. Therefore,\tthe High  Court was in error in entertaining
\nthe writ  petition and\tit should have been dismissed at the
\nthreshold.\n<\/p>\n
672<\/span><\/p>\n
     In substance,  this was  a suit for refund of a royalty
\nalleged to be unauthorisedly recovered and that could hardly
\nbe entertained\tin exercise  of the writ jurisdiction of the
\nHigh Court.\n<\/p>\n
     As the  High Court\t has also  disposed of\tthe case  on
\nmerits after overruling the preliminary objection, it is but
\nmeet that  we may examine the case on merits and that itself
\nwould demonstrably  show the dangerous course adopted by the
\nHigh Court in examining rights and obligations claimed under
\nthe contract without proper or adequate material or evidence
\nto reach  a conclusion,\t more so  when the  petition  raised
\ndisputed questions of facts which needed investigation.\n<\/p>\n
     Respondent\t No.  1\t had  entered  into  a\tlease  dated
\nSeptember 27,  1932 with  the Secretary\t of State for India.
\nPart II\t of the\t lease describes  the  land  leased  to\t the
\nrespondent. The description is as under;\n<\/p>\n
\t  N. C.\t Tengalbasti Village  in Sootea Mauza in the
\n     Tezpur Sadar  Sub-Division of  Darrang District.  Block
\n     No. 1 Field No. 2-1804 B. 4 K-12L, Block No.2 Field No.
\n     3-1544 B. 2 K-13L.<\/p><\/blockquote>\n
\t  Total-1107.26 Acres on 3349 B. 2K-5L
\nThis land was taken on lease for cultivation and raising tea
\ngarden. Under the relevant Clause 2 above, the lessee was to
\npay timber  valuation on  full rate  for all  timber sold or
\nremoved\t for   sale  and  on  all  timber  removed  for\t use
\nunconnected with exploitation of the grant during the period
\nof lease  or renewed  lease. From  this negative covenant in
\nthe indenture  of lease,  the  respondent  says\t that  where
\ntimber is  cut and  felled and\tremoved for a purpose or use
\nconnected with\tthe exploitation  of grant during the period
\nof lease  or renewed  lease, royalty  shall not\t be payable.
\nAssuming the  respondent is  right in  its  construction  of
\nClause 2  of the  indenture of\tlease, in  order  to  obtain
\nrelief, namely,\t to cut\t and remove  timber from  the leased
\narea for  purpose connected  with the  exploitation  of\t the
\ngrant, it  must show that the timber is being felled and cut
\nfrom an\t area covered  by the  lease in which Clause 2 finds
\nits place  and that  such timber  is  being  removed  for  a
\npurpose connected  with the exploitation of the grant. To be
\nmore specific,\tfollowing facts\t will  have  to\t proved\t for
\nobtaining relief:\n<\/p>\n
\t  (i)  The area covered by the grant.\n<\/p><\/blockquote>\n
673<\/span><\/p>\n
\t  (ii) Felling of the trees from the area covered by
\n\t       the grant.\n<\/p><\/blockquote>\n
\t  (iii)Use to  which the felled timber was to be put
\n\t       to.\n<\/p><\/blockquote>\n
\t  (iv) Such  use will  have to be one connected with
\n\t       the exploitation of the grant.\n<\/p><\/blockquote>\n
\t  (v)  What is\tmeant by  the  exploitation  of\t the
\n\t       grant ?\n<\/p><\/blockquote>\n
Could these facts be assumed without evidence ? Was the High
\nCourt justified\t in observing  that it\twas called  upon  to
\ndecide complicated  questions of  facts ?  Some averments in
\nthe petition  were disputed.  The appellant  contended\tthat
\nClause 2  of the indenture of lease only means that if there
\nis some use of timber which is being felled and removed from
\nthe area covered by the grant for the purpose connected with
\nthe exploitation  of that very grant, then and only then the
\nrelief can  be claimed\tunder Clause 2. The High Court found
\nas a  fact that\t the timber was sought to be removed for the
\npurpose of constructing quarters for the workmen employed in
\nPartabghur Garden  situated in Dekorai Division. Admittedly,
\nthis  Partabghur   Garden  is  not  situated  in  Tezalpatty
\nVillage. At any rate, Partabghur Garden where the houses for
\nthe workmen  were to be constructed was situated outside the
\narea covered  by the  grant, as\t also  outside\tthe  Revenue
\nDivision in which the leased area is located. The High Court
\ngot over  this difficulty  by observing that the grant being
\nin favour  of an incorporated company, it can cut and remove
\ntimber from leased area for use at any place which is owned,
\nmanaged or  controlled by  the company\tand it is immaterial
\nwhether one  is directly connected with the other or not. If
\nthe timber  is being felled from the area of one grant to be
\nused at\t some other  place where  the Company is carrying on
\nits operation,\tthe benefit of the removal of timber without
\npayment\t of  royalty  would  be\t available  to\tthe  Company
\nanywhere in  the world.\t To  stretch  this  logic  a  little
\nfurther, it  would mean\t that if the respondent (Company) is
\nto set up a tea garden outside India, it can as well cut and
\nremove timber  from N.C. Tezalpatty, Grant No. 1 in Assam to
\nthe place  outside  India  without  the\t obligation  to\t pay
\nroyalty. The  fallacy underlying  the approach\tof the\tHigh
\nCourt  becomes\tself-evident.  It  is  immaterial  that\t the
\ngrantee was  the Company. The specific provision is that the
\ngrant is for a purpose of cultivation and raising tea garden
\nand that  from the  area covered  by the grant, if timber is
\nfelled for  purpose connected with the grant itself, namely,
\ncultivation and\t raising tea  garden in that area then alone
\nbenefit of  removal of timber without payment of royalty can
\nbe
\n674<\/span>
\navailed of.  It is  admitted that  Partabghur Tea  Garden is
\noutside the  area covered  by  the  grant,  in\tfact  in  an
\naltogether different  division. In  such a  situation upon a
\ntrue construction  of Clause  2, Part  IV  of  indenture  of
\nlease, the  respondent Company\twas not\t entitled to  remove
\ntimber\twithout\t payment  of  royalty.\tTherefore,  even  on
\nmerits, the High Court was in error in granting relief.\n<\/p>\n
     Accordingly, this appeal is allowed and the judgment of
\nthe High  Court is  quashed  and  set  aside  and  the\twrit
\npetition filed\tby the\trespondent  in\tthe  High  Court  is
\ndismissed with costs throughout.\n<\/p>\n
S.R.\t\t\t\t\t     Appeal allowed.\n675<\/span>\n\n\n\n<\/pre>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Divisional Forest Officer vs Bishwanath Tea Co. Ltd on 5 May, 1981 Equivalent citations: 1981 AIR 1368, 1981 SCR (3) 238 Author: D Desai Bench: Desai, D.A. PETITIONER: DIVISIONAL FOREST OFFICER Vs. RESPONDENT: BISHWANATH TEA CO. LTD. DATE OF JUDGMENT05\/05\/1981 BENCH: DESAI, D.A. BENCH: DESAI, D.A. MISRA, R.B. (J) CITATION: 1981 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-209882","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nDivisional Forest Officer vs Bishwanath Tea Co. 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