Civil Writ - Fundamental Rights – Right to Carry on Trade – Article 19(1)(g) – Monopoly in favour of a single contractor – Bye-laws of Municipal Board struck down – The petitioner, a wholesale commission agent in vegetables and fruits, was prohibited from carrying on his trade as monopoly rights were auctioned to another person by the Municipal Board – Bye-laws prohibited carrying on wholesale business except through the contractor, leaving no scope for licensing others – Held: Such absolute prohibition amounts to violation of Article 19(1)(g) and is not a reasonable restriction under Article 19(6) – Bye-laws declared void under Article 13(1) [Paras 4-5, 8].

Bye-laws – Section 241(2) U.P. Municipalities Act – Requirement of License – Non-existence of Bye-law for grant of license – The Board rejected petitioner’s application for license on the ground that no bye-law authorised issuance of license – Held: Section 241(2) permits refusal only if conditions under the Act are not complied with – Refusal without legal basis invalid – Petitioner’s right to trade cannot be extinguished merely due to absence of enabling bye-law [Paras 5].

Effect of Pre-Constitution Laws – Applicability of Article 19(1)(g) – Contention that petitioner’s rights were extinguished before the Constitution came into force as bye-laws operated from 1.1.1950 rejected – Held: Article 19(1)(g) protects all citizens after commencement of Constitution irrespective of whether trade was lawfully carried on earlier [Para 6].

Writ Jurisdiction – Availability of Alternative Remedy – Section 318 U.P. Municipalities Act – Adequacy of Appeal – Respondent argued that remedy lay in appeal to local Government – Held: Existence of alternate remedy not a bar to relief under Article 32 – Appeal under Section 318 inadequate since Board itself disabled from granting license – Supreme Court has wider powers under Article 32 [Para 7].

Decision – Petition Allowed – Fundamental right under Article 19(1)(g) infringed – Municipal Board directed not to prohibit petitioner from carrying on wholesale trade in vegetables and fruits within Kairana limits except in accordance with validly framed bye-laws in future – Prosecution against petitioner to be withdrawn – Costs awarded to petitioner [Para 8].

Civil Writ – Habeas Corpus - Preventive Detention – Constitutionality – Article 13(2) & Preventive Detention Act, 1950 – Validity upheld – Petitioner contended that the Preventive Detention Act abridges fundamental rights under Part III and is void under Article 13(2) – Held: The issue already decided in A.K. Gopalan v. State where Act was upheld except Section 14 (severable) – Hence Act not unconstitutional [Paras 2, 8].

Preventive Detention – Mala Fide Allegation – Order of District Magistrate – Scope of Judicial Review – Petitioner alleged mala fide exercise of power in detaining him despite his role in refugee relief and absence of published press report – Held: Satisfaction of detaining authority is subjective and Court cannot substitute its own satisfaction – Burden lies on detenu to establish mala fides, which was not discharged – Suspicion not equivalent to proof – No mala fides conclusively established [Paras 5-6, 9-10].

Alternative Remedies – Availability of Ordinary Law – Section 144 CrPC vs. Preventive Detention Act – Question of propriety – Observed: Though ordinary law like Section 144 CrPC could have sufficed, use of extraordinary preventive detention powers cannot be invalidated merely on suspicion – Court expressed caution against misuse of preventive detention powers but did not find sufficient ground to interfere [Paras 6, 11].

Decision – Petition Dismissed – Detention order under Preventive Detention Act upheld – No mala fide established – Court dismissed writ petition but cautioned authorities to prevent misuse of extraordinary detention powers [Paras 6, 11].a

Civil Law - Equitable Mortgage – Deposit of Title Deeds – Section 58(f), Transfer of Property Act – Creation of Mortgage – Mortgage by deposit of title deeds is complete when deeds are deposited with intent to create security – No registered instrument necessary unless parties intend to reduce bargain into writing – Law implies contract from deposit itself [Paras 4-5].

Registration – Section 17, Registration Act – Memorandum recording deposit of title deeds – Distinction between operative instrument and evidential memorandum – If memorandum embodies essential terms of bargain and constitutes agreement, registration compulsory – If it merely records past transaction, no registration required – Time of delivery not decisive; intention of parties is crucial [Paras 4-5].

Precedents – Privy Council Decisions – In Obla Sundarachariar v. Narayana Ayyar (58 I.A. 68), memorandum held not registrable as it merely recorded delivery of deeds – In Hari Sankar Paul v. Kedar Nath Saha (66 I.A. 184), memorandum held registrable as it embodied essential terms of transaction and operated as agreement – Principle reiterated by Supreme Court [Para 5].

Application to Present Case – Memorandum in form of letter recorded deposit of deeds already made – Did not create or embody operative bargain – Only evidential in nature – Held: Not compulsorily registrable – Properly admitted in evidence to prove equitable mortgage [Para 6].

Decision – Appeal dismissed – Decree enforcing mortgage upheld – Costs awarded against appellant [Paras 7-8].

Criminal Law – Murder Conviction – Scope of Interference by Supreme Court – Appellant convicted by Sessions Judge and conviction confirmed by Punjab High Court – Evidence of five eye-witnesses, including mother of deceased, accepted by both courts – Held: Supreme Court not a regular court of criminal appeal and will not re-weigh evidence where concurrent findings of fact based on witness credibility exist – No reason to depart from settled rule [Paras 1-3].

Special Leave – Article 136, Constitution of India – Nature and Scope – Assumption that once leave granted, all findings of fact open to challenge rejected – Only points fit to be urged at stage of grant of leave may be argued at final hearing – Principle consistent with Privy Council rulings in Ibrahim v. Rex [1914 A.C. 615] – Special leave not to convert Supreme Court into third fact-finding tribunal [Paras 4-5].

Appellate Jurisdiction – Articles 132–136, Constitution of India – Comparative Scope – Article 132 applies to substantial questions of constitutional law (civil/criminal); Article 133 confined to civil matters; Article 134 restricts criminal appeals to specified cases; Article 135 preserves jurisdiction of Federal Court; Article 136 confers wide discretionary power over judgments of any court or tribunal – Power to be exercised sparingly and in exceptional cases only [Paras 6-7].

Principles for Grant of Special Leave – Exceptional and special circumstances must exist – Substantial and grave injustice must be shown – Case must present features of sufficient gravity – These principles consistent with Privy Council practice, though not binding – Present case did not satisfy these conditions – No interference warranted [Paras 8].

Decision – Appeal dismissed – Conviction and sentence of death upheld – No exceptional circumstance justifying interference under Article 136 [Para 9].

Company Law – Section 105-C – Further issue within authorised capital – Bona fides – Appeal dismissed – Directors resolved on 21.02.1945 to issue 4,596 shares at premium and offered them pro rata to members on the register in the ratio 4:5 – Challenge that the issue was mala fide to retain control and that Section 105-C was contravened – Held: Section 105-C mandates a pre-emptive pro-rata offer to existing members and aims to prevent discrimination or preference to outsiders – On facts, the company needed capital and the directors acted bona fide – No breach of Section 105-C established as the offer was proportionate and any unoffered balance remained unissued – Appeal dismissed with costs [Paras 4-7, 13-21, 46, 48-55, 57].

Directors’ fiduciary duty – Mixed motives and protection of corporate interest – Where directors act primarily for the company’s benefit, the presence of a subsidiary motive (resisting an outsider’s attempt to corner control) does not vitiate the action – Directors owed no fiduciary duty to outsider purchasers whose names were not on the register – Equity intervenes only where power is used solely for personal aggrandisement or to defeat the majority – Standard affirmed with reference to Hirsche v. Sims and Beatty – Allegations of mala fides rejected on concurrent findings [Paras 25-29, 35-46].

Section 105-C – Scope and construction – Applies when directors decide to increase capital by issuing further shares within the authorised limit – Distinct from Section 50 increases of nominal capital by the company – Not necessary to import Table A Regulation 42 phrase “as nearly as circumstances admit” into Section 105-C – The section is given a workable, businesslike construction to secure equal and equitable pre-emptive rights while avoiding deadlock – Technical non-absorption of the entire lot by the initial ratio does not constitute contravention so long as the balance is not disposed of contrary to the section [Paras 13-21, 48-55].

Proportional offer mechanics – Directors may choose a practicable ratio for pro-rata rights that equitably reaches all members – Any fractional or residual shares that cannot be conveniently offered remain unissued unless and until lawfully disposed of after members decline – Clause permitting disposal applies only to shares actually offered but not applied for – No disposal of the residual 272-4/5 shares had occurred – Hence, no violation ripened [Paras 19-21, 54-55].

Judicial restraint in corporate discretion – Courts will not interfere with bona fide business decisions taken within statutory limits and in the company’s interest – Interference warranted only where power is exercised to manipulate voting control against the existing majority, as in Fraser v. Whalley, Punt v. Symons, and Piercy – Those cases distinguished as instances of sole improper purpose absent corporate benefit [Paras 41-45].

Decision – Appeal dismissed with costs – Directors’ resolution upheld – Issue held bona fide and consistent with Section 105-C – No ground to disturb concurrent findings [Paras 7, 29, 55, 57].

Criminal Law - Preventive Detention – Validity of Ordinance – Section 88, Government of India Act – Detention Orders Upheld – The appellants challenged their detention under Ordinance IV of 1949, alleging lack of Governor’s competence under Section 88 and repugnancy with existing laws – Held: Satisfaction of the Governor under Section 88(1) is subjective and not justiciable – The Ordinance fell within Items 1 and 2 of Provincial List (public order and preventive detention) – No repugnancy with Criminal Procedure Code – Detention lawful [Paras 5-7, 10-16].

Legislative Competence – Public Order and Preventive Detention – Bihar Ordinance dealt exclusively with maintenance of public order, preventive detention, and ancillary provisions – “Public order” is a comprehensive expression – Offences created under the Ordinance and arrest powers under Section 21 incidental to competence under List II – No necessity to invoke Concurrent List – Pith and substance doctrine applied [Paras 12-15].

Repugnancy – Section 107, Government of India Act – No Conflict with Code of Criminal Procedure – Arrest without warrant under Section 21 and summary trials by Magistrates under Ordinance do not conflict with Sections 54 and 160 CrPC – Section 1(2) CrPC preserves special laws – In absence of repugnancy, Governor-General’s assent unnecessary [Paras 14-16].

Bona fides of Promulgation – Mala fides Allegation Rejected – Ordinance promulgated after earlier Act and extension notifications were declared ultra vires – Failure to prorogue legislature in earlier Ordinance was a mistake, not mala fide – Governor acted bona fide to preserve public order [Para 17].

Validity of Certain Provisions – Sections 23, 24, and Proviso to Section 4(1) – Section 23 (repeal of void laws) treated as superfluous – Section 24 (savings) irrelevant to present detentions, even if invalid not inseparably linked with Ordinance – Proviso to Section 4(1) permitting non-disclosure of all grounds upheld – Legislature competent to enact; courts cannot question policy once subject is within legislative competence – Preventive detention remains valid and not converted into arbitrary detention [Paras 19-24].

Decision – Appeals dismissed – Ordinance within legislative competence – Detention orders valid – No violation of Section 88 or Section 107 of Government of India Act – No illegality in impugned provisions [Paras 25].

Civil Law - Transfer of Property – Part Performance – Section 53-A TPA – Unregistered lease agreement – Defence upheld – A permanent lease was negotiated between the Talukdari Settlement Officer (with Government sanction) and the predecessor of the defendant; though no formal registered lease was executed, the offer and acceptance were in writings signed by the parties and Government – The terms (permanent lease; rent Rs. 290; revision after 50 years) could be ascertained with reasonable certainty – The transferee took possession, erected a factory and paid rent to successive managers – Held, conditions of Section 53-A were satisfied and the transferor/plaintiff was debarred from enforcing ejectment – Assistant Judge’s decree dismissing the suit restored [Paras 3-6, 10-11, 15-18].

Evidence – Secondary evidence of contract – Government records – Admissibility and reliability – Exh. 181 (Government Resolution/letter reciting the correspondence, offer, acceptance and sanction) constituted reliable secondary evidence of the written and signed contract where the primary documents were in the possession/power of the plaintiff/talukdars and withheld despite notice – Adverse inference justified – High Court erred in discarding Exh. 181 as proof of contract and terms [Paras 4, 16-17].

Registration Act – Section 49 – Unregistered instrument as evidence of part performance – Even if a formal lease deed is unregistered or absent, a signed written agreement creating a present demise may be looked into as evidence of part performance; Section 49 permits use of such agreement for the limited purpose – Formal registered lease is not a precondition to invoke Section 53-A TPA [Para 18].

Specific Relief – Section 27-A (active equity in leases) – Scope and temporal reach – The equity of part performance is recognized as an active equity in lease cases under Section 27-A of the Specific Relief Act, but that provision applies only to contracts executed after 01/04/1930; nevertheless, Section 53-A TPA furnishes a complete statutory defence in the present case [Para 16].

Civil Procedure – Second appeal – Interference with concurrent/sustainable findings – Where the Assistant Judge’s conclusion is sustainable on the statutory defence under Section 53-A TPA on the proved record (including admissible secondary evidence), there existed no substantial ground for reversal in second appeal; High Court’s interference set aside [Para 15].

Landlord and Tenant – Plaintiff’s locus/notice – Questions on plaintiff’s title to sue and notice were raised but not decided as unnecessary in view of the success of the Section 53-A defence; High Court’s contrary view on standing does not survive [Paras 14-15].

Decision – Appeal Allowed – Judgment of the High Court set aside; decree of the Assistant Judge restoring dismissal of the suit – Parties to bear their own costs throughout [Para 18 (concl.)].

Civil Law - Agency – Scope of Authority – Commission Note – Authority to Conclude Sale – Construed broadly – The commission note authorised the broker to “negotiate the sale” and “secure a buyer” with stipulations of title being free of encumbrances and good title – Held: Such language implied authority to conclude a binding contract of sale, not merely to introduce a prospective buyer – Subsequent conduct of parties confirmed this understanding – Broker’s acceptance of buyer’s firm offer for Rs. 1,10,000 created binding contract – Commission earned [Paras 7-8, 26-28, 44-46].

Agency – Right to Commission – Negotiating Sale and Securing Buyer – Whether dependent on actual completion at stipulated price – Not dependent – Once broker introduced buyers who made a firm offer at Rs. 1,10,000, and eventual sale was concluded with the same buyers, commission right crystallised on that basis – Principal’s unilateral reduction of price to Rs. 1,05,000 (suspected to deprive broker of dues) cannot defeat broker’s entitlement – Commission payable on Rs. 1,10,000 [Paras 5, 10-11, 22-23, 47-53].

Luxor (Eastbourne) Ltd. v. Cooper – Distinguished – Principle that commission contracts create purely contingent rights applies where commission expressly conditional upon completion – In present case, buyers actually completed purchase – Once event occurred, commission right vested – Principal cannot defeat it by lowering sale consideration – House of Lords case not applicable [Paras 11, 54-57, 59-60].

Contract Act – Sections 188, 219 – Interpretation – Section 188 permits agent to act within express/implied authority – Terms “secure a buyer” and “negotiate sale” imply power to bind principal where conditions of title and price are specified – Section 219 entitles agent to agreed remuneration upon completion of duty – Applied here in broker’s favour [Paras 26, 45-46, 51].

Evidence – Conduct of Parties – Silence as acquiescence – Respondent’s silence upon being informed of concluded bargain, coupled with subsequent clandestine sale to same buyers at reduced price, supported inference that agent acted within authority and that sale for lower figure was collusive to deprive agent of commission [Paras 20, 22, 28].

Decision – Appeal Allowed – Judgment of High Court (awarding only Rs. 1,000 commission) set aside – Decree of trial Judge restored – Appellant entitled to full commission of Rs. 6,000 with costs throughout [Paras 12, 46, 65-66].

Limitation – Execution of Decree – Article 182(3), Limitation Act, 1908 – “Review” must be undertaken and decided – Application under Section 36, Bengal Money-Lenders Act dismissed for default – No review “undertaken” or “decision passed on the review” – Time not extended – Held: Art. 182(3) inapplicable [Paras 3-4].

Limitation – Article 182(2) – “Where there has been an appeal” – Must relate to the decree under execution – Appeal from dismissal under Order IX Rule 9 CPC in collateral Section 36 proceeding does not qualify – No extension of limitation – Held: Art. 182(2) inapplicable [Para 5].

Execution – Starting Point of Limitation – Application filed more than three years after final decree – Not saved by collateral proceedings or dismissed applications – Decree time-barred [Paras 2-3, 4-5].

Decision – Appeal Dismissed – High Court upheld – Execution held barred by limitation; no costs interference warranted [Paras 6-7].