Criminal Procedure – Quashing of FIR – Scope and Limits of Judicial Interference – Complaint against a former Chief Minister alleging disproportionate assets – FIR quashed by High Court on grounds of political vendetta and mala fides – Supreme Court reverses High Court decision – Holds that FIR disclosed commission of cognizable offence and warranted investigation – High Court erred in evaluating evidence and motives at pre-investigation stage – Principles regarding interference with criminal investigation reiterated – However, investigation by SHO quashed for violation of mandatory provision under Section 5A of the Prevention of Corruption Act – Liberty granted to State to reinvestigate through a competent officer [Paras 12, 66, 84-108, 135, 144-145]

Criminal Law – Prevention of Corruption Act, 1947 – Section 5(1)(e) read with Section 5(2) – Allegation of accumulation of disproportionate assets by public servant – FIR registered on complaint of political rival – Allegations included benami transactions, undervaluation, and unaccounted properties in names of relatives – Held: Even if political rivalry existed, it does not vitiate criminal investigation where FIR discloses cognizable offence – Proper course is to allow investigation, not to quash FIR at threshold – Political motive alone not sufficient to nullify otherwise valid criminal proceedings [Paras 17, 67, 72, 111, 114]

Criminal Procedure Code, 1973 – Sections 154, 156, 157, 482 – Registration of Cognizable Offence – Police duty to register case when information discloses cognizable offence – At registration stage, police cannot assess credibility or truth of allegations – Held: Police officer is statutorily bound to register FIR if information discloses cognizable offence – Courts cannot quash FIR merely because allegations appear politically motivated unless they fall under specific exceptions – High Court exceeded jurisdiction by evaluating evidence and motives prematurely [Paras 31-33, 54, 65, 66, 108]

Criminal Procedure Code, 1973 – Inherent Power of High Court under Section 482 – Seven categories of cases where FIR or criminal proceedings may be quashed – Court lays down exhaustive principles for exercise of extraordinary or inherent powers – Held: Quashing appropriate only in rarest of rare cases – Judicial intervention must be exercised sparingly and with circumspection [Paras 84-106]

Quashing – Seven Guiding Principles – Supreme Court lays down illustrative categories where FIR or criminal proceedings may be quashed –

(i) Allegations do not disclose any offence even if accepted in entirety –

(ii) Allegations do not disclose a cognizable offence –

(iii) Uncontroverted allegations and evidence do not make out any case –

(iv) Case relates to non-cognizable offence investigated without Magistrate’s permission –

(v) Allegations are absurd or inherently improbable –

(vi) Legal bar to institution or continuance of proceedings exists –

(vii) Proceedings are manifestly attended with mala fides or maliciously instituted for vengeance – Held: Present case does not fall within any of these categories [Para 105]

Criminal Procedure – Section 5A of Prevention of Corruption Act – Validity of Investigation by Officer below Designated Rank – SHO (Inspector) directed by SP to investigate case under Section 5(1)(e) of PC Act – SP’s order lacked reasons and violated second proviso to Section 5A(1) – Held: Investigation by SHO without proper authorisation invalid – Mandate of Section 5A is mandatory – Investigation quashed with liberty to State to commence afresh through competent officer [Paras 121-135, 144]

Public Interest – Rule of Law – No Immunity to High Officials – Former Chief Minister cannot claim immunity from law – Accusations, if serious and disclosing cognizable offence, must be investigated – Observation by High Court suggesting mutual respect between political rivals held misplaced and deprecated – Court reiterates that law must prevail irrespective of position or office [Paras 3-4, 143]

Decision: Judgment of High Court quashing FIR set aside – However, investigation by SHO quashed for want of proper authorisation under Section 5A of the PC Act – Liberty granted to State of Haryana to initiate fresh investigation through authorised officer – Costs awarded to Ch. Bhajan Lal to be paid by complainant Dharam Pal – No order as to costs otherwise [Paras 144-145]

Civil Procedure – Pleadings and Alternative Relief – Plaintiff filed suit for ejectment based on tenancy – Trial Court found tenancy established but limited rent to Rs. 300 per month – High Court found no tenancy but held defendant a licensee and confirmed ejectment – Held: Even if specific plea of licence not taken, court can grant relief if matter was in issue, evidence led, and no prejudice caused – Substance of pleadings and trial prevails over form [Paras 5, 10–13, 15]

Tenancy vs. Licence – Defendant admitted plaintiff’s ownership of land – Claimed to have constructed house at own cost and stayed till repayment – Trial Court disbelieved both versions but found landlord-tenant relationship – High Court found no tenancy but permissive possession – Held: Where defendant’s possession was permissive, ejectment could follow even absent tenancy – Admission of title and failure to prove right to retain possession sufficient to infer licence [Paras 3–6, 12–14]

Mesne Profits – Future Mesne Profits – High Court denied past rent and mesne profits due to lack of proof of tenancy – Supreme Court upheld denial of past rent but allowed claim for future mesne profits from date of decree – Defendant liable to compensate for continued use post-ejectment decree – Rs. 300 per month awarded from date of Trial Court’s decree till delivery of possession [Paras 17–19]

Appellate Procedure – Order 41 Rule 33 CPC – Relief can be moulded if substantial issues were tried and no prejudice caused – Courts not bound by strict pleadings where alternative basis for relief emerges and evidence supports it – Procedural rules should not defeat substantive justice [Paras 10–11, 15]

Decision: Defendant’s appeal dismissed – Plaintiff’s appeal partly allowed – Decree for future mesne profits at Rs. 300/month from 16/10/1958 until possession delivered – No costs in either appeal.

Criminal Law – Conspiracy – Joint Trial – Sections 233 to 239 CrPC – High Court held joint trial of accused for multiple offences including conspiracy, criminal breach of trust, and forgery to be illegal – Supreme Court overruled, holding that provisions under Section 239 CrPC are enabling and may be applied cumulatively – Joint trial for offences committed in the course of the same transaction permissible – Misjoinder not a ground for acquittal unless prejudice is shown – Held: No failure of justice occurred, joint trial valid [Paras 1–32].

Criminal Law – Conspiracy and Substantive Offences – Charge for Conspiracy Maintainable – High Court erroneously held that once substantive offences were committed, conspiracy charge was impermissible – Supreme Court held that conspiracy is a distinct offence – Charge of conspiracy can stand even where acts in pursuance have been committed – Multiple offences committed in furtherance of one conspiracy form part of same transaction [Paras 33–36].

Criminal Procedure – Section 342 CrPC – Accused Examination – No Illegality – Allegation of complex and unfair questioning rejected – Court held that questions, though lengthy, did not result in prejudice – Court not obliged to inform accused of right to testify under Section 342(4) – No error or miscarriage of justice shown [Paras 40–42].

Evidence – Approver’s Testimony – Section 133, 114 of Evidence Act – Grant of Pardon under Section 337 CrPC – Valid – Supreme Court upheld legality of pardon granted by Additional District Magistrate (Independent) – Offences fell within ambit of Section 337 – Approver’s evidence held admissible and not rendered unreliable solely due to grant of pardon – High Court’s view on inadmissibility incorrect [Paras 50–60].

Evidence – Books of Account – Absence of Entries – Section 11, 5 Evidence Act – High Court wrongly held absence of entries inadmissible – Supreme Court held that absence of entries in account books of recipient firms relevant under Sections 5 and 11 – Not confined to Section 34 Evidence Act – Also clarified that documents in Gujarati not inadmissible merely for lack of translation [Paras 43–47].

Criminal Procedure – Section 537 CrPC – No Prejudice – Supreme Court held that even if misjoinder of charges occurred, conviction cannot be set aside unless failure of justice shown – Absence of objection at trial stage fatal to plea [Para 32].

Decision: Appeal allowed – Acquittal set aside – Matter remanded to High Court for fresh consideration on merits in light of findings on law – High Court to assess sufficiency of evidence, including approver’s testimony and corroboration, and determine if prosecution establishes specific charges [Paras 61–64].

Criminal Law – Bombay Prohibition Act – Proof of Alcohol Consumption – Admissibility of Chemical Examiner’s Report – Compliance with Section 129A Not Mandatory – Appellant's blood sample collected in hospital outside police investigation and later examined by Chemical Analyst – Held (Majority): Section 129A does not exclusively govern all blood tests for raising presumption under Section 66(2) – Sub-section (8) of Section 129A expressly allows proof by other means – Report of Chemical Examiner based on blood taken independently of Section 129A is admissible under Section 510 CrPC – No bar to relying on such evidence in prosecution under Section 66(1)(b) [Paras 19–27, 31].

Criminal Law – Presumption under Section 66(2) – Standard of Proof – Chain of Custody Required – Though report admissible, prosecution must establish integrity and identity of blood sample – No evidence as to custody, storage, or seal verification from time of extraction to testing – Chain of custody not proven – Held: Presumption under Section 66(2) could not be safely applied without foundational proof of sample integrity [Paras 12–14].

Criminal Procedure – Retrial – When Permissible – Miscarriage of Justice – Not for Filling Evidentiary Gaps – Sessions Judge ordered retrial due to evidentiary defects – Held: Retrial cannot be ordered solely to allow prosecution to cure its evidentiary lapses – Proper course was to allow additional evidence under Section 428 CrPC if necessary to do justice – Retrial order set aside [Paras 15–17].

Criminal Law – Dissent – Section 66(2) Can Only Be Invoked When Procedure under Section 129A Followed – (Per Das Gupta, J., dissenting) – Procedure under Section 129A is mandatory for invoking presumption under Section 66(2) – Any other method of proving alcohol concentration is excluded – Blood sample not collected as per Section 129A, hence Chemical Examiner’s report inadmissible – Appeal should be allowed and appellant acquitted [Paras 34–54].

Decision: By majority: Appeal dismissed – Order of retrial by Sessions Judge set aside – Case remanded to Sessions Court to decide appeal on merits with liberty to record additional evidence as necessary under Section 428 CrPC – Appellant to be re-examined under Section 342 CrPC and given opportunity to lead rebuttal evidence [Paras 32–33, 55–56].

Land Acquisition – Reference under Section 18 – Limitation – Knowledge of Award – Meaning and Relevance – Respondents, whose lands were acquired without notice under Section 12(2), applied for a reference under Section 18 after receiving compensation – Held: Limitation under Section 18(b) begins not from the date of award, but from the date of knowledge of essential contents of the award – “Knowledge” under proviso (b) to Section 18 requires awareness of the substantive terms of the award – Award never communicated and no constructive notice proven – Date of actual knowledge was July 22, 1955 when compensation was received – Reference application made within six months thereof was within limitation [Paras 5–7].

Land Acquisition – Reference under Section 18 – Civil Court’s Jurisdiction to Examine Limitation – Judicial Conflict – Conflicting views noted across High Courts as to whether civil courts can adjudicate on the limitation of a reference under Section 18 – Some decisions permit courts to examine if a reference is valid; others restrict court’s jurisdiction to only objections on merits – Held: No need to resolve conflict in the present case as reference found to be within time – Question left open for future determination [Para 8].

Procedural Law – Acquisition Without Notice – Effect on Limitation – Where notice under Section 12(2) is not issued, limitation must be computed from actual or constructive knowledge of the award – Mere awareness of acquisition does not amount to knowledge of award’s terms – Collector rightly accepted affidavit of respondent asserting no prior knowledge – Application held timely [Paras 6–7].

Decision: Appeal dismissed – Reference application under Section 18 held to be within limitation – No need to decide scope of civil court's power on limitation issue – Costs awarded to respondents [Paras 9–10].

Service Law – Compulsory Retirement – Rule 244(2) of Rajasthan Service Rules – Not a Penalty – Not Attracted by Article 311 – Respondent compulsorily retired in public interest under Rule 244(2) – Held: Such retirement is not by way of punishment and is not covered under Rule 14 of the Classification Rules – Article 311 not attracted – Action under Rule 244(2) is administrative in nature and not penal [Paras 1–2, 6].

Service Law – Interpretation of Business Rules – Rule 31(vii)(a) – Scope – Governor’s Prior Approval Not Required for Compulsory Retirement under Rule 244(2) – Business Rules require submission to Governor only in cases of “compulsory retirement” imposed as a penalty alongside dismissal or removal – Held: Words “compulsory retiring” in Rule 31(vii)(a) to be read ejusdem generis with “dismissing” and “removing” – Therefore, do not include retirements under Rule 244(2) or on superannuation – High Court’s interpretation incorrect [Paras 4–6].

Administrative Law – Article 166 – Defective Form of Government Order – Validity – Burden on State to Prove Actual Decision – Order of retirement not issued in the form required under Article 166 – Held: Defect of form does not render order invalid if State can prove order was in fact passed by competent authority – State produced file noting approval by Home Minister and Chief Minister – Retirement order valid [Paras 7–8].

Statutory Interpretation – General Clauses Act – Definition of “Government” and “State Government” – Must Yield to Business Rules – Definition of “State Government” in Rajasthan General Clauses Act includes Governor – Held: Subject to contrary provisions – Business Rules permit disposal of such matters by Minister-in-charge – Governor’s personal decision not required for retirement under Rule 244(2) [Para 9].

Decision: Appeal allowed – Judgment of the High Court set aside – Compulsory retirement upheld – No costs awarded [Paras 10–11].

Taxation – Classification – Article 14 – Validity of taxing only Virginia Tobacco – Andhra Act XIV of 1955 amended Section 5 of Madras General Sales Tax Act to impose tax on Virginia tobacco while exempting country tobacco (Nattu tobacco) – Held: Classification based on clear and intelligible differentia such as taste, texture, cultivation, usage, and marketability – State has wide discretion in taxation – Distinction reasonable and not violative of Article 14 [Paras 5–11]

Taxation – Sales in Course of Export – Article 286(1)(b) – Whether purchase of Virginia tobacco by exporters pursuant to prior foreign contracts constitutes sale in course of export – Held: Sales preceding actual export are preparatory and not sales that occasion export – Such purchases not protected under Article 286(1)(b) – Tax validly levied [Paras 12–16]

Interpretation – Article 286(1)(b) – Scope clarified – Only sales which occasion export protected – Not applicable to earlier purchases made for executing export orders – Reliance on precedent including Travancore-Cochin v. Bombay Co., Shanmugha Vilas Cashew Nut Factory and Mysore Spinning & Manufacturing Co. cases [Paras 13–15]

Burden of Proof – Challenge under Article 14 – Onus lies on person assailing legislation to prove absence of rational classification – Higher burden in case of taxing statutes – Court reiterates settled principle from U.S. Supreme Court and Indian jurisprudence [Para 9]

Decision: Appeals dismissed – Impugned legislation held constitutionally valid – Tax on Virginia tobacco upheld – Not violative of Article 14 or Article 286(1)(b) – Appellant to bear costs [Paras 17–18]

Service Law – Probation – Reversion from Higher Post – Appellant was appointed as Extra Assistant Commissioner on probation – Despite commendable service and no extension of probation period by the Governor, appellant was reverted to his former post of Tehsildar – Held: Mere lapse of probationary period does not confer a right to confirmation – However, absence of unsatisfactory service reports and commendations received negated bona fide administrative reversion [Paras 11-13].

Article 311 – Reversion as Punishment – Reversion cloaked as administrative action but in effect punitive – Appellant had been exonerated in an earlier inquiry under the Public Servants (Inquiries) Act, 1850 – Reversion followed commendations, indicating action was not based on unsuitability but perceived misconduct – Held: Reversion was mala fide and imposed without complying with Article 311(2), hence illegal [Paras 14-17].

Constitutional Law – Article 226 – Judicial Review – High Court Single Judge rightly held reversion as punitive and quashed it – Division Bench reversed without appreciating the mala fide elements and penal consequences involved – Supreme Court restored Single Judge’s order, reiterating constitutional protection under Article 311(2) even for probationers if punitive action is taken [Paras 6-7, 17].

Decision: Appeal allowed – Order of reversion dated May 28, 1952 quashed – Reversion held illegal being in violation of Article 311(2) – Costs awarded to appellant in Supreme Court and High Court [Paras 18-19].

Constitutional Law – Legislative Competence – Entry 49 List II – “Taxes on Lands and Buildings” – Scope – Challenge to U.P. Large Land Holdings Tax Act, 1957 on ground that “lands” in Entry 49 does not include agricultural land – Held: Word “lands” in Entry 49 is of wide amplitude and includes agricultural land – Constitution must receive liberal interpretation – Tax on agricultural land is within State competence – Validity of the Act upheld [Paras 10–12].

Taxation – Determination of Annual Value – Section 5(1) of U.P. Act XXXI of 1957 – Discretion of State Government – Word “may” not mandatory – Section 5(1) allows State Government to prescribe multiples for determining annual value – Word “may” confers discretion, not obligation, to fix different multiples for districts or land classes – Notification of 23 April 1958 prescribing varying multiples satisfies statutory requirement [Paras 13–14].

Taxing Statutes and Fundamental Rights – Applicability of Part III – Articles 14 and 19(1)(f) – Taxing laws, being “laws” within Article 13, are subject to fundamental rights – Their validity can be tested under Articles 14 and 19 – It is settled that a tax law may be struck down for unreasonable classification or arbitrary procedure but not merely for the rate or extent of taxation [Paras 15–17].

Article 31 – Deprivation of Property – Inapplicability to Tax Laws – Taxing statutes do not amount to “acquisition” or “requisition” of property under Article 31(2) – Mere high taxation does not constitute deprivation within Article 31(1) – A validly enacted tax law satisfies “authority of law” requirement – Article 31(2A) and 31(5)(b)(i) exclude taxing laws from challenge under Article 31(2) [Para 18].

Article 14 and 19(1)(f) – Reasonableness and Classification – Discretion under Section 5(1) – Discretion given to State Government to fix multiples is not arbitrary or unguided – Legislative policy to augment revenue through landholding tax provides adequate guidance – No unreasonable restriction or inequality shown [Para 19].

Validity of Graded Tax Rates – Schedule to the Act – Reasonable Classification – Graded taxation based on annual valuation of landholding is rational and uniform – Classification based on land value satisfies Article 14; no infringement of property rights under Article 19(1)(f) [Para 20].

Colourable Legislation – Confiscatory Tax Allegation – Allegation that Act was confiscatory and fraudulent rejected – Mere heaviness of tax does not prove colourable exercise – Burden lies on petitioner to show legislative fraud or discrimination – Petitioner’s figures unsupported; official data show reasonable taxation – U.P. Act distinguished from confiscatory Kerala Land Tax Act struck down in K.T. Moopil Nair v. State of Kerala [Paras 21–25].

Constitutional Interpretation – Rule of Liberal Construction – Fiscal Laws – Entries conferring legislative power must be interpreted broadly to effectuate constitutional intent – Narrow reading of fiscal entries inconsistent with constitutional design [Paras 10–12].

Decision: U.P. Large Land Holdings Tax Act, 1957 intra vires the State Legislature – Sections 3 and 5(1) do not contravene Articles 14, 19(1)(f), or 31 – Tax not confiscatory or colourable – Petition dismissed with costs [Paras 26–27].