# I961 Ga11ga DuU MuYarka v. Kartik Chandra Das Shah]. February r7

- **Citation:** [1961] 3 S.C.R. 820
- **Court:** Supreme Court of India
- **Decided:** 1961
- **Case number:** Civil Appeals Nos. 314-316 & 778 of 1957
- **Bench:** P. B. Gajendragadkar, K. N. Wanchoo, K. c. DAS GUPTA
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/i961-ga11ga-duu-muyarka-v-kartik-chandra-das-shah-february-r7-1928
- **Pages:** 26

## Headnote

'
Requisition and Acquisition of Property-Orders by Government of India-Notice on managing agents-Validity-Holders of
Pucca delivery order, if owners of goods-Estoppel-Defence of India
Act, z939 (35 of z939)-Defence of India R.11les, z939, rr. 75A, zz9Code of Civil Procedure, z908 (Act V of z908), 0. XXIX, r. 2lndian Companies Act, z9z3 (7 of I9z3), ss. 2(zz),z,,.S-Indian Sale
of Goods Act, z930 (3 of z930), s. z8.
The Government of India entered into an agreement with
the President of Argentine Institute for Promotion of Trade to
supply hessian in return for licences for shipment to India of
food-stuff purchased there and with a view to implement that
agreement issued orders under r. 75A(1) of the Defence of India
Rules, 1939, on the managing agents of certain jute mills on
September 30, 1946, requisitioning hessian and directing them
and any other person in possession of the said goods to deliver
them to the Director of Supplies, Calcutta. Although 'in the
heading of the notices after the names of the managing agents it
was not stated that they were being addressed as managing
agents of such and such mills, the schedules attached to them
made it clear that they were addressed as managing agents of
such and such mills. On the same day notices of acquisition
under r. 75A(2) were served on the said managing agents and
they were further informed that under r. 75A(3) the goods would
vest in the Government at the beginning of the same day free
from any mortgage, pledge, lien and other similar encumbrance.
The notices of acquisition were also accompanied by schedules
similar to those accompanying the requisition <;>rders.
The
38.C.R.
SUPREME COURT REPORTS
821
Government of India tried to take possession of the hessian but
was resisted by the mills and the holders of pucca delivery
orders and brought the suit, out of which th~ present appeals
arose, for enforcing the said orders of requisition and acquisition.
The Defence of India Act, 1939, and the Rules made thereunder,
had in the meantime come to an end and the question before the
court~ below was whether the orders of requisition and acquisition as served were effective in law. The trial judge held that as
there were no valid orders of requisition as the mills had not
been properly served and since the goods were subject to pucca
delivery orders, the mills as well as the Government were
estopped from challenging the ownership of the holders of the
said delivery orders. The appeal court held that the orders of
requisition were valid and binding, that the mills, and not the
holders of the delivery orders, were the owners of the goods but
that the notices of acquisition had not been served as required
by r. 75A(2) of the Rules and,. therefore, there was no valid
acquisition under r. 75A(3J of the Rules.
Held, that the requisition of the goods C,Juld. be effected
either by taking possession of them or by requiring them to be
placed at the disposal of the requisitioning authority. Since in
the present case, the mills and not the holders of the delivery
orders were admittedly in possession of the goods on the date of
the requisition, the proper persons to be served with the orders
were the mills.
Since the Rules did not expressly provide as to the manner
in which orders of requisition in writing under r. 75A had to be
served, r. n9(1) must apply and as the orders in the present case
concerned an individual corporation, they had to be served in
the. manner prescribed by 0. XXIX, r. 2 of the Code of Civil
Procedure.
The word "officer" as defined by s. 2(ii) of the Indian Companies Act, 1913, includes a managing agent and such definition
can be utilised for the purpose of the Code and regard being had
to the nature of his duties there can be no doubt that a managing
agent would be within the expression " other principal officer"
in 0. XXIX, r. 2(a) of the Code.
There was no basis for the contention that service under
r. 2 must be on some human being or that there could be no
effective s

## Text

_Characters 0–39,990 of 58,643. This is a partial read: ask again with offset=39990 for what follows._

I961
Ga11ga DuU
MuYarka
v.
Kartik
Chandra Das
Shah].
February r7.
820
SUPREME COURT REPORTS
[1961)
was not in pursuance of any contract express or
implied, but was by virtue of the protection given by
the successive statutes. This occupation did not confer
any rights upon the appellant and was not required to
be determined by a notice prescribed by s. 106 of the
Transfer of Property Act.
In that view of the case, this appeal fails and is
dismissed with costs.
Appeal dismissed.
JUTE AND GUNNY BROKERS LTD.
AND ANOTHER
v.
THE UNION OF INDIA AND OTHERS.
(and connected appeals)
(P. B. GAJENDRAGADKAR, K. N. WANCHOO and
K. c. DAS GUPTA, JJ.)
'
Requisition and Acquisition of Property-Orders by Government of India-Notice on managing agents-Validity-Holders of
Pucca delivery order, if owners of goods-Estoppel-Defence of India
Act, z939 (35 of z939)-Defence of India R.11les, z939, rr. 75A, zz9Code of Civil Procedure, z908 (Act V of z908), 0. XXIX, r. 2lndian Companies Act, z9z3 (7 of I9z3), ss. 2(zz),z,,.S-Indian Sale
of Goods Act, z930 (3 of z930), s. z8.
The Government of India entered into an agreement with
the President of Argentine Institute for Promotion of Trade to
supply hessian in return for licences for shipment to India of
food-stuff purchased there and with a view to implement that
agreement issued orders under r. 75A(1) of the Defence of India
Rules, 1939, on the managing agents of certain jute mills on
September 30, 1946, requisitioning hessian and directing them
and any other person in possession of the said goods to deliver
them to the Director of Supplies, Calcutta. Although 'in the
heading of the notices after the names of the managing agents it
was not stated that they were being addressed as managing
agents of such and such mills, the schedules attached to them
made it clear that they were addressed as managing agents of
such and such mills. On the same day notices of acquisition
under r. 75A(2) were served on the said managing agents and
they were further informed that under r. 75A(3) the goods would
vest in the Government at the beginning of the same day free
from any mortgage, pledge, lien and other similar encumbrance.
The notices of acquisition were also accompanied by schedules
similar to those accompanying the requisition <;>rders.
The
38.C.R.
SUPREME COURT REPORTS
821
Government of India tried to take possession of the hessian but
was resisted by the mills and the holders of pucca delivery
orders and brought the suit, out of which th~ present appeals
arose, for enforcing the said orders of requisition and acquisition.
The Defence of India Act, 1939, and the Rules made thereunder,
had in the meantime come to an end and the question before the
court~ below was whether the orders of requisition and acquisition as served were effective in law. The trial judge held that as
there were no valid orders of requisition as the mills had not
been properly served and since the goods were subject to pucca
delivery orders, the mills as well as the Government were
estopped from challenging the ownership of the holders of the
said delivery orders. The appeal court held that the orders of
requisition were valid and binding, that the mills, and not the
holders of the delivery orders, were the owners of the goods but
that the notices of acquisition had not been served as required
by r. 75A(2) of the Rules and,. therefore, there was no valid
acquisition under r. 75A(3J of the Rules.
Held, that the requisition of the goods C,Juld. be effected
either by taking possession of them or by requiring them to be
placed at the disposal of the requisitioning authority. Since in
the present case, the mills and not the holders of the delivery
orders were admittedly in possession of the goods on the date of
the requisition, the proper persons to be served with the orders
were the mills.
Since the Rules did not expressly provide as to the manner
in which orders of requisition in writing under r. 75A had to be
served, r. n9(1) must apply and as the orders in the present case
concerned an individual corporation, they had to be served in
the. manner prescribed by 0. XXIX, r. 2 of the Code of Civil
Procedure.
The word "officer" as defined by s. 2(ii) of the Indian Companies Act, 1913, includes a managing agent and such definition
can be utilised for the purpose of the Code and regard being had
to the nature of his duties there can be no doubt that a managing
agent would be within the expression " other principal officer"
in 0. XXIX, r. 2(a) of the Code.
There was no basis for the contention that service under
r. 2 must be on some human being or that there could be no
effective service on a corporation by serving another corporation
which might be its principal officer.
The service of the orders of requisition on the managing
agents obviously meant for the mills in the instant case, was,
therefore, good service under 0. XXIX, r. 3 of the Code.
Since r. 75A(2) itself did not provide for any mode of service
of notice under it, either the one or the other of the modes
specified in s. 148 of the Indian Companies Act, 1913, or '
0. XXIX, r. 2 of the Code would be a reasonable mode of effecting service thereunder.
In the instant case the notices of
1961
J "'' & Gunny
Broh1rs Ltd.
v.
Uni°" of I11dia
] ute <So Gunny
BrokeJ"s Ltd.
v.
Union of India
822
SUPREME COURT REPORTS
(1961]
acquisition having been served under 0. XXIX, r. 2(a), as the
orders of requisition had also been, such service was good service
and the acquisition was effective in law.
It was not correct to say that the property in the goods
represented by the pucca delivery orders had passed to their
holders. The contract involved in such delivery orders is a contract' of sale of unascertained goods and in view of s. r8 of the
Indian Sale of Goods Act, 1930, title cannot pass to the buyer till
the goods are' ascertained by appropriation.
Anglo-India Jute Mills Co. v. Omademull (1910) I.L.R. 38
Cal. 127, explained.
It was not correct to say that the Government of India in
acquiring the requisitioned goods was claiming title throu·gh the
mills and would be, like them, estopped qua the holders of pucca
delivery orders. The power to acquire the property flowed from
the Defence of India Act and the Rules made thereunder and
covered not merely the rights of the owners but the entire goods.
Rule 75A(3) of the said Rules made it quite clear the acquisition
thereunder was of a title paramount and of the whole of the
property freed from all kinds of encumbrances.
No question of serving any notice on the holders of pucca
delivery orders, therefore, arose in the present case as the property in the goods had not in law passed to them.
CIVIL
APPELLATE
JURISDICTION:
Civil Appeals
Nos. 314-316 & 778 of 1957.
Appeals from the J udgme_nt and . Decree dated
September 8, 1954, of th€ Qalcutta High Court in
appeal from Original Decree No. 159 of 1951.
S. Chowdhury, B. Das and P. K. Ray Chaudlrury, for
the appellants in Civil Appeal No. 314 of 1957.
M. C. Setalvad, Attorney.General for India, R. Ganapathy Iyer and D. Gupta, for respondent No. 1.
S. N. 111ukherjee, for respondent No. 2.
S. M. Bose, B. Sen and B. N. Ghosh, for .respondents
Nos. 3-18, 20-40, 42 and 44-4 7.
B. N. Ghosh, for respondent No. 48.
N. C. Chatterjee and P. K. Chatterjee, for respondent
No. 51.
S. ltf. Bose, S. Chowdhury, B. Sen and B. N. ·Ghosh,
for the appellants in Civil Appeal No. 315 of 1957.
M. C. Setalvad, Attorney-General for India, R. Ganapathy Iyer and D. Gupta, for respondent No. 1.
S. N. Mukherjee, for respondent Ko. 2.
3 S.C.R.
SUPREME COURT REPOR'rs
823
P. K. Ray Chaudhury, for respondent No. 6.
B. Das and P. K. Ray Chaudhury, for respondents
Nos. 8-28.
P. K. Chatterjee, for respondent No. 30.
S. Chowdhury and P. K. R. Chaudhury, for the appellant in Civil Appeal No. 316 of 1957.
M. C. Setalvad, Attorney-General for India, R. Ganapathy Iyer and D. Gupta, for respondent No. l.
S. N. Mukhe1jee, for respondent No. 2.
B. Das and B. N .. Ghosh, for respondents Nos. 3-18,
20-40, 42, 44, 47 and 49-69.
N. C. Chatterjee and P. K. Ghatte1jee, for respondent
No. 71.
M. G. Setalvad, Attorney-General for India, R. Ganapathy Iyer and D. Gupta, for the appellant in Civil
Appeal No. 778 of 1957.
S. M. Bose, S. Chowdhury, B. Sen and B. N. Ghosh,
for respondents Nos. 2-17, 19-39, 41 and 43-46.
Sukumar Ghose, for respondent No. 40.
S. Chowdhury and P. K. Ray Chaudhury, for respondent No. 47.
S. Chowdhury, B. Das and P. K. Ray Chaudhury,
for respondents Nos. 4fl-69.
N. C. Chatterjee and P. K. Chatterjee, for respondent
No. 71.
1961. February 17. The Judgment of the Court was
delivered by
jute 6' Gunny
Brokers Ltd.'
v.
Union of India
WANCHOO, J.-These four appeals on certificates
Wanchoo J.
granted by the High Court at Calcutta arise out of
one judgment and will be dealt with together. The
brief facts necessary for present purposes are these :
In September 1946 there was food shortage in the
country. In order to relieve this shortage, the Government of India. entered into an agreement with the
President of Argentine Institute for Promotion of
Trade by which it undertook to freeze, requisition and
take over and sell to the Argentine Institute and ship
to Argentine 30,000 tons of hessian and in return the
Institute guaranteed to obtain licences for shipment
z96z
]Ille eo Gunny
lffokm Ltd.
v •.
Union of India
W anchoo J.
824
SUPREME COURT REPORTS
[1961)
from Argentine of maize and wheat offals already
purchased by the Government of India in Argentine.
This agreement was arrived at on September 27, 1946.
In anticipation of this agreement, the Government of
India on September 20, 1946, addressed letters to the
managing agents of various jute mills in Bengal
demanding from them information as to stocks of
hessian of certain description held by the mills under
their managing agencies and pr~hibiting them from
selling, transferring, removing, consuming or otherwise disposing of any article enumerated in Sch. B
to the communication. This demand was made under
sub-rule (5) of r. 75-A of the Defence of India
Rules (hereinafter called the Rules). After the information had been gathered, the Government of India
issued an order on September 30, 1946, to the same
managing agents requisitioning the hessian specified
in the Schedule to the order and directing them and
every other person in possession of the said property
to deliver it to the Director of Supplies, Calcutta, and
in the meafitime not to dispose of the property in any
.eianner without the permission of the Central Government. The Schedule to the order in each case
indicated the mill from which the requisition was
made, the quantity, the description of the hessian
and the name of the registered stock-holders. These
requisition orders were served· upon the managing
agents of the mills under sub-r. (1) of r. 75-A of the
Rules on that very day. Thereafter on the same day,
that is, September 30, 1946, the Government of India
issued a notice under sub-r. (2) of r. 75-A to the
managing agents communicating that it had· been
decided to acquire the property under that sub-rule.
The managing agents were further informed that by
virtue of sub-r. (3) of r. 75·A the said property .would
vest in the Central Government at the beginning of
the day on which the notice was.served upon them
free from any mortgage, pledge, lien or other similar
encumbrance. The notices of acqnisition were accompanied by schedules similar to the schedules accompanying the requisition orders. This notice of acquisition was also served on the same day on all the
'
3 S.C.R.
SUPREME COURT REPORTS
825
managing agents. Further on the same day. the
Deputy Director of Supplies, Governnient of India>· ·:f.ute&Gunny
wrote to the Secretary, Indian Jute Mills Association
JJ;~, Ltd.
that shipping inst.ructions would be issued in due , · "'
course by the Director of Supplies, Calcutta, with
Union of India
respect to hessian requisitioned and acquired under
the orders and notices already referred to. The
Government then tried to take possession of the
hessian requisitioned and acquired but the mills and
the holders of delivery orders resisted the Government's attempt cin the ground that the orders of
requisition and acquisition were invalid. The Government of India then filed the suit, out of which the
present appeals have arisen, on December 11, 1946,
for enforcing the orders of requisition and acquisition
and also applied for a receiver to be appointed. This
application was resisted and it became apparent that
it would take some time before it could be disposed of.
As ships which were to carry the hessian to Argentine
were ready and shipment could not be delayed, the
Government on January 7, 1947, promulgated an
Ordinance, being Ordinance No. 1 of 1947, whereby
notwithstanding the pendency of the suit the title and
possession of the goods requisitioned and acquired were
made to vest in the Government. The Government
thei;t took possession of the hessian and shipped the
same to Argentine. The suit however did not become
infructuous or unnecessary after this because s. 3 of
the Ordinance provided that the suit should be
proceeded with in regard to one question involved in
it and decision thereon obtained. Under s. 3 it was
provided that if in the suit it was finally decided that
the said goods were not validly requisitioned or
acquired by the Central Government on the 30th day
of September, 1946, each of the several previous
owners of the said goods would be entitled to receive
as compensation from the Central Government the
market price prevailing on the date of the institution
of the aforesaid suit; but if no such de.cision was made
in the suit, the said goods would be deemed to have
been validly requisitioned and acquired by the Central
Government on the 30th September, 1946, and the
Wanchoo ].
I96I
juJe (" ..... Gunny
Brokers Ltd.
v,
Union of India
H'anchoo J.
826
SUPREME COURT REPORTS
[1961]
amount of compensation to be paid by the Central
Government to the several previous owners of the said
goods would be determined in accol'dance with the
provisions of law in force on September 30, 1946,
relating to the requisition and acquisition of movable
property uuder the rules made under the Defence of
India Act, 1939. It mav bo mentioned that tho Defonce
of India Act, 1939, and the Rules rnade there<rnder
came to an cn<l on September 30, 1946. The main
question therefore which remained to be decided in
the suit was whether the ordern of requisition and
acquisition were valid and binding on the respective
defendants; and the suit was confined to obtaining a
declaralion to that effect. If a clcclaration was granted
to the Government of Indht as prayed, the compensa.
tion would be determined as on September 30, 1946,
in accordance with the provisions of Ia w in force on
that day relating to the requisition and acquisition of
movable property under the ru)es made under the
Defence of India Act, l!.!39.
On the other hand, if no
such deobrntiou was gmatrd, compensation would
have to be arrived at in accordance with the market
price of hessian prevailing on the date on which the
suit was filed, i.e., December 11, 1946.
The main questions which arose for determination
in the trial court were four, namely-(1) ·were the
alleged orders ofrequisition dated September 30, 1946, ·
mentioned in the plaint properly and/or validly a11d/or
duly served? (2) Did such alleged orders effe.ct any
valid reqnisition of the goods mentioned in tlrn
Schedules to such orders? (3) Were the orders and
notices of acquisitfon mentioned in the plaint properly
made or given and/or duly served ? (4) Is there any
custom of trade, practice or usage that upon delivery
ol'ders being made over to the buyers against pa.yment
the property in the goods represented by such delivery
orders passed to snch buyers ?
S11rkar, ,J., who tried the suit on the original side of
the High Court held that the orders of requisition
were properly and validly made. He further held
that there was no servic:e of the orders on the mills
\Yhiob were in possession of the hessian and which
I
3 S.C.R.
SUPREME COURT REPORTS
827
had to be served in order to effect a valid requisition.
He therefore held that as there was no proper or due
service of the orders there was no valid or binding
requisition. Further on the question of acquisition he
held that as the goods requisitioned and aequired
were subject to pucca delivery orders and in view of
the usage that pucca delivery orders were only issued
against payment, were passed from hand to hand by
endorsemeut and were sold and dealt with in the
market as absolutely representing. the goods to which
they relate and as the mills were estopped from
challenging that the property in the goods had passed
(see Anglo-India Jute Mills Co. v. Omademall (')), the
Government which was claiming ownership through
the mills was also subject to estoppel and as the
holders of the delivery-orders being the owners of the
property were not served on September 30, 1946, under
r. 75-A (2) of the Rules, the property in the goods
therefore did not pass on September 30, 1946. On this
view the suit was dismissed.
The Union of India then went in appeal. The
appeal court reversed the view of Sarkar J. on the
question of requisition. It held that the requisition
orders did affect and intended to affect individual
mills and service on the managing agents of the mills
was good service on the mills and therefore the orders
of requisition were valid. On the question of acquisition the appeal court posed the question whether the
notices of acquisition were served on the owners as
required by r. 75-A (2). It did not agree with the
view of Sarkar J. that the Government was claiming
through the mills and were therefore estopped from
challenging the title of the holders of deli very orders.
It also held that property in the goods could not pass
by estoppel in the face of the provisions of the Sale of
Goods Act, III of 1930.
Accordingly it held that it
was not necessary to serve the holders of the delivery
orders with notices of acquisition ; but it further held
that the mills which. were the owners of the goods
requisitioned were not served with the notices of
(1) (1910)1.L.R. 38Cat. 127.
106
jute G- Gunny
BroAers Ltd.
v.
Union of lnili4
WancAno ].
jute & Gunny
Brokers Ltd.
v.
Tlnton of India
n·'anchno .f.
828
SUPREME COURT REPORTS
[1961]
acquisition, as in its opinion strict compliance with
the provisions of the rules in 0. XXIX of the Code of
Civil Procedure were necessary in order that transfer
of ownership contemplated under r. 75-A of the Rules
may he effected. Further as there was failure to
comply strictly with the provisions of 0. XXIX of
the Code of Civil Procedure anr~ as in the view of the
appeal court r. ll9 (l-B) of the Rules did not apply to
the case, there was no service of notices of acquisition
on the owners a.s required hy r. 75-A (2) of the Rules;
therefore it held that the acquisition was not valid.
In the result the appeal was partly allowed as to the
effect of the requisition orders but the view of
Sarkar J. was upheld as to the effect of notices of
acquisition.
This has been followed by four appeals on certificates granted by the High Court. Appeals Nos. 314 to
316 are by the defenda.nts in the suit challenging the
view of the appeal court that the orders of requisition
were valid and binding. The appellants in these
appeals will hereinafter be referred to as the defendants.
Appeal
~o. 778 is by the Union of India
challenging the view of the appeal court that the
notices of ac<1nisition were not properly served and
therefore there was no acquisition of property on
September 30, 1946, as provided by r. 75-A (3).
We shall first deal with the three appeals by the
defendants rch1ting to the requisition-orders. It is
necessary to set out rr. 75-A a.nd 119 of the Rqles in
this connection, for the validity of the requisition
orders depends upon whether the two rules have been
0omplied with. The two rules are as follows:-
" 75A. (1) If in the opinion of the Central Government or .the Provincial Government it is necessary
or expedient so to do for securing the defence of
British India, public safety, the maintenance of
public order or the efficiPnt prosecution of the war,
or for maintaining snpplies and services essential to
the life of the community, that Government may by
order in writing requisition any property, movable
or im111ovahle, and may make such further orders as
t
3 S.C.R.
SUPREME COULtr ltEPOlt'fS
829
'
appear to that Government to be necessary or
expedient in connection with the requisitioning:
Provided that no property used for the purpose of
religious worship and no such property as is referred
to in rule 66 or in rule 72 shall be requisitioned under
this rule.
(2) \Vhere the Central Government or the Provincial Government has requisitioned any property
under sub-rule (I), that Government may use or deal
with the property in such manner as may appear to
it to be expedient, and may acquire it by serving
on the owner thereof, or where the owner is not
readily traceable or the ownership is in dispute, by
publishing in the Official Gazette, a notice stating
that the Central or Provincial Government, as the
case may be, bas decided to acquire it in pursuance
of this rule.
(3) Where a notice of acquisition is served on the
owner of the property or published in the official
gazette under sub-rule (2), then at the beginning of
the day on which the notice is so served or published, the property shall vest in Government free from
any mortgage, pledge, lien or other similar encumbrance and the period of the requisition thereof
shall end.
(4) ......................................................... "
"119. (I) Save as otherwise expressly provided
in these Rules, every authority, officer or person·
who makes any order in writing in pursuance of
any of these Rules shall, in the case of an order of
a general nature or affecting a class of persons,
publish notice of such order in such manner
as may, in the opinion of such authority, officer
or person, be best adapted for informing persons whom the order concerns, in the case of an
order affecting an individual corporation or firm
serve or ca.use the order to be served in the manner
provided for the servic,e of a summons in rule 2 of
Order XXIX or rule 3 of Order XXX as the case
may be in the First Schedule to the Code of Civil
Procedure, 1908 (V of 1908), and in the case of an
] ltlt & G1t,.11}'
Br.hers Ltd.
,,
Union o} India
WaHchoo }
z96I
Jute &. Gunny
Brokers Ltd.
v.
Union of l.ndia
Wan ~lsoo ].
8:10
SUPREME COURT l{EPORTS
[1961)
order affecting an individual person (not being a
corporation or firm) serve or cause the order to be
served on that person-
(i) personally, by delivering or tendering to
him the order, or
(ii) by post, or
(iii) where the person cannot be found, by leaving an authentic copy of the order with some
adult male member of his family or by affixing
such copy to some conspicuous part of the
premises in which he is known to have laot
resided or carried on business or personally
worked for gain.
(1-A). Where any of these Rules empowers a.n
authority, officer or person to take action by notified order, the provisioils of sub-rule (1) shall not
apply in relation to such order.
(1-B). If in the course of any judicial proceeding,
a question arises whether a person was duly informed of an order made in pursuance of these
Rules, compliance with sub-rule (1), or, in a ca.se to
which sub-rule (l-A) applies, the notification of the
order, shall be conclusive proof that he was so
informed; but a failure to comply with subrule (1)-
(i) shall not preclude proof by ot.her means that
he had information of the order; and
(ii) shall not affect the validity of the order."
The scheme of r. 75-A(lj which provides for requisitioning is that the Government has to form an
opinion whether it is necessary or expedient to make
a requisition for securing the defence of British India,
public safety, the maintenance of public order or the
efficient prosecution of the war or for maintaining
supplies and services essential to the life of the
community.
After such opinion has been formed,
the Government may by order in writing requisition
any property, movable or immovable, and make such
further orders as appear to it to be necessarr, or
expedient in that connection. It has been fauitlJ;
urged on behalf of the defendants that the orders of
requisition were invalid as they did not comply with
t
I
3 S.C.R.
SUPREME COURT REPORTS
831
the first condition indicated above, namely, the necessity or expediency of passing the order. It is enough
to say that there is nothing in this contention. The
order of September 30, 1946, states in so many words
that "in the opinion of the Central Government it is
expedient for maintaining supplies and services
essential to the life of the community" to make a
requisition. It has never been the case of the defendants that the orders of requisition were passed mala
fide. In these circumstances, in the absence of mala
fides, the opinion of the Government is final and the
purpose indicated by it in the orders for making
requisitions is one of the purposes for which an order
of requisition can be made nuder r. 75.A.
The main contention of the defendants in their
appeals is that r. 75-A contemplates that the orcler
of requisition must be brought to the knowledge
of the person whose interests are being affected by it
and that this was not done in this case, for neither
the holder., of delivery orders nor the mills were
apprised of the orders of requisition on September 30.
Therefore, it is urged that the orders of requisition
were not valid and binding. Now sub-rule (1) of
r. 75-A does not specifically provide for the manner
in which an order of requisition is to be served, nor
does it provide specifically on whom such an order
should be served. So far as the person on whom a.n
order of requisition should be served is concerned, we
agree with the appeal court that service of such an
order is necessary on the person who can place the
goods in question at the disposal of the requisitioning
authority a.nd until that is done there cannot be a.ny
valid and effective requisition. This is also clear from
the definition of the word "requisition" in r. 2(11)
of the Rules, for "requisition" means in relation
to a.ny property, to take possession of the property or to require the property to be placed at the
dispose.I of the requisitioning authority. Therefore a
requisition of property ca.n be effected either by taking
possession of the property or by requiring the property to be placed a.t the dispose.I of the requisitioning
authority. In the present case we a.re concerned with
} ule &- Gilnny
Broker's Lttl.
v.
Union of India.
WaHchvo J.
]ut1 & Gunny
Broker' L,d.
v.
U•i<m of India
Wane~oo ].
832
SUPREME COURT REPORTS
[1961]
the second mode. of requisition. In such a case it is
necessary that the party which is required to place
the goods in question at the disposal of the requisitioning authority should be informed of the order of
requisition, so that it may place the property at the
disposal of the requisitioning authority aH required by
the order. Three questions therefore immediately
arise in this connection, namely, (i) who were the
proper persons on w horn orders of requisition should
have been served, (ii) what is the manner in whwh
the orders should have been served, and (iii) whether
proper persons have been served in the proper manner
in this case.
So far as an order of requisition is concerned, we
are of opinion that there is no question of any service
of the order on the holders of delivery orders, for
whatever may be their position as to the ownership
of the goods (a matter with which we shall deal later
when considering the matter of acquisition), they
were admittedly not in possession of the goods on
September 30. Further the goods were admittedly in
the possession of the mills and therefore the proper
persons to be served with the orders of requisition
in this case were the mills.
The next question is as to the manner in which the
mills which were in possession of the goods had to be
served. To that the answer is in our opinion to be
found in r. 119 of the Rules. Rule 119 (1) provides that
save as otherwise expressly provided in these rules,
every order in writing in pursuance of any of these
rules shall be served in the manner provided therein.
Now there is no express provision as to the manner
in which an order of requisition in writing issued
under r. 75-A has to be served; therefore it has to be
served as provided in r. 119 (1).
Further, as orders
in this case concerned an individual corporation they
had to be served in the manner provided for service
of summons in r. 2 of 0. XXIX of the Code of Civil
Procedure. Rule 2 of 0. XXIX provides that where
the suit is against a corporation, the summons may
be aerved on the secretary, or on any director, or
othe.r principal officer of the corporation, or by leaving
3 S.C.R.
SUPREME COURT REPORTS
833
it or sending it by post addressed to the corporation
at the registered office or if there is no registered
office then at the place where the corporation -carries
on business.
We have therefore to see whether the
mills were served with the orders of requisition in the
manner provided by r. 2 of 0. XXIX of the Code of
Civil Procedure. Further in case there is any irregularity in sen· ice it will have to be seen whether the
matter comes under sub-r. (1-B) of r. 119.
Let us therefore first examine the question whether
the mills were served as provided in 0, XXIX, r. 2.
Now the orders of requiRition were sent to the
managing agents of tbe various jute mills. It is true
that in the heading of the order, though the name of
the managing agency corporation was mentioned, it
was not specifically stated there that the order was
being addressed to it as the managing agents for such
and such mills.
But when one reads the schedule
attached to each order sent to the managing agents,
it becomes immediately clear that the order was
intended for the mills mentioned in the schedule and
was being ser1•ed on the managing agents of the mills.
As an instance, we may refer to one requisition order
addressed to Messrs. Thomas Duff and Co. Ltd. In
the schedule it was clearly stated that the order was
with respect to jute bales held by the jute mills under
the rnanagin;:; agency of the addressee and the names
of the jute mills with respect to which the order was
passed and was being communicated to the managing
agents were
also mentioned, that is, Titaghur,
Victoria, Samnaggur (South) and 8amnaggur (North)
Jute Mills.
Any one receiving this order should be
therefore able immediate! v to understand that the
order was served on Messr;. Thomas Duff and Co. Ltd.
as the managing agents of the four jute mills mentioned above. Tbe defect therefore in the form of
address was in our opinion of no consequence. The
order read as a whole along with the 'schedule leaves
no doubt that the order was meant for the jute mills
mentioned in the schedule and was addressed to
Messr-s.. Thomas Duff and Co. Ltd. as the managing
agents of those jute mills. It js. not in dispute that
Jute & Gun11y
Brokers Lid.
v.
Union of India
IV a11Cloo J.
jute 6- Gunny
Brokers LI~.
v.
Unioh of India
WaJU:hoo ].
834
SUPREME COURT REPORTS
[1961)
orders of requisition with respect to other mills
addressed to other managing agents were in the same
form and contained similar schedules. There can
therefore in our opinion be no doubt that the orders
of requisition were meant for the mills and were
addressed to them through the managing agents. It
is not in dispute that those orders were served on the
managing agents on September 30, 11!46, and the only
question therefore that remains to be considered is
whether the service on the managing agents on behalf
of the mills is proper service as provided in r. 119 (1)
of the Rules read with r. 2 of 0. XXIX of the Code of
Civil Procedure.
In the matter of service, we are concerned with
cl. (a) of 0. XXIX, r. 2, which provides that summons
may be served on the secretary, or on any director or
other principal officer of the corporation ; and what we
have to see is whether service on the managing agents
was service on " other principal officer" of the
corporation. Section 2 (11) of the Indian Companies
Act, No. VII of 1913, which was in force at the
relevant time, defines an "officer " to include any
director, managing agent, manager or secretary.' So a
managing agent of a. corporation is an officer of the
corporation. The question then is whether he is a.
principal officer, and the answer to our mind is
obvious, considering the nature of the duties of a.
managing agent of a corporation. It, is not seriously
disputed either that if a managing a.gent is an officer
of the oorpora.tion, he would, considering the nature
of his duties, be a princi'[J<il officer. What is, however,
contended is that the definition of an officer given in
the Companies Act is a.n artificial definition and is
only for the purposes of the Companies Act and not for
the Code of Civil Procedure. The appeal court did not
accept this contention and wa.s of the opinion that the
definition of a.n officer given in th.e Companies Act can
a.Iso be utilised for the purpose of the Code of Civil
Procedure and we think that that view is correct.
Therefore, when the service in this case was effected
Oll the managing agents of the mills it was effected on
one of the principal officers of the corporation and
3 S.C.R.
SUPREME COURT REPORTS
835
would be a good service under 0. XXIX, r. 2. But it
is contended that the intention behind 0. XXIX, r. 2
is that the service must be on a human being and that
O. XXIX, r. 2 does not contemplate service on one
corporation
for the purpose of securing service
on another corporation. In this connection reliance is
placed on rr. 1 and 3 of 0. XXIX where it is urged
that the same words occur and it is clear that these
rules contemplate that the other principal officer'
mentioned therein mu8t ·be a human being. This
contention was urged before the appeal court and was
rejected by it-and in our opinion, rightly. It is true
that under rr. I and 3, the principal officer envisaged
must be a human being, but that conclusion follows
from the setting in which these words appear in these
two rules. Rule l relates to the signature and verification of a pleading by the secretary, director or other
principal officer of the corporation while r. 3 provides
that a court may require the personal appearance of
the secretary or of any director or other principal
officer of the corporation. It is obvious therefore from
the setting in which the words "other principal officer"
appear in these two rules that he must be a human
being, for signature and verification in one case and
personal appearance in another can only be by a
human being. But rr. I and 3 do not define who a
principal officer is. Therefore, even t.hough in these two
rules a principal officer must be a human being, it
does not follow that in r. 2 also he must be a human
being. Rule 2 relates to service a_nd cl. (b) thereof
clearly shows that the 8ervice to be effected need not
necessarily be on a human being connected with the
corporation, for under cl. (b) the service will be effective
if the summons is left or sent by post addressed to the
corporation at the registered office or if there is no
registered office then at the place where the corporation carries on business.
Therefore, for service to be
effective it is not necessary that summons must be
served on some human being connected with the
corporation. Nor <lo we see anything in 0. XXIX
which would militate against our holding that thA
service ou one corporation may be made by sening
107
jute & Gun"Y
Brokers Ltd.
v.
Union of India
Wanchoo ].
..
ju:e 6- Gunny
Brokers Ltd.
v.
Union of lndia
Wanchoo .f.
836
SUPREME COURT REPORTS
[1961]
another corporation which may be the principal officer
of t.he first corporation. Once it is clear in view of
the definition of an "officer" in s. 2 (II) of the Companies Act that a managing a.gent is an officer and
when it is obvious considering the nature oft he duties
of a managing agent of the corporation that it must
be held to be a principal officer, service on the managing agent of a corporation would be effective service
for the purpose of 0. XXIX, r. 2. We therefore agree
with the appeal court that the orders of requisition
in this case having been undoubtedly served on the
managing agents of the mills as such there has been
proper service of the said orders on the mills as
required by r. ll9 of the Rules. Therefore as the
servic~ on the mills through the mana.ging agents was
good service within the meaning of r. II9 read with
0. XXIX, r. 2, it is unnecessary to consider the further question whether it is good service within the
meaning of r. ll9 (1-B). We are therefore in agreement with the appeal court that the orders of
requisition were properly and validly and duly served
on the mills through the managing agents and therefore these ordern effected a valid requisition of the
goods mentioned in the schedules attached thereto. In
this view Appeals Nos. 314 to 316 fail and are hereby
dismissed.
Now we turn to the appeal of the Union of India
with respect to acquisition. It is not disputed that
on the same day (namely, September 30, 1946) notice
of the deoision to acquire the requisitioned goods
was served on the same managing agents. Here again
in the heading of the notice only the name of the
managing 11gent was mentioned without specifying in
so many words that. the communication was being
addressed to the managing agency corporation concerned as m:inagiug agents of such and such mills.
But it is not. in dispute that as in the ca8" of orders
of rcqui8ition so in the case of notices of acquisition
then• waR a schcdi;le attac~'ed ai1d thM schedule
mentione1l that acqui8iliun was of goods held by tho
jute milb under the managing agency of the corporation to which tlw noliee was >tddressecl and the names
I
3 8.G:l{.
SUPREME COUl{T REPORTS
837
of the mills whose managing agents the addressed
corporation was, were also mentioned in the schedule.
It is clear therefore that the notice of the decision to
acquire was given to the various managing agents of
the. various mills in their capacity as managing agents
of the mills specified in the schedule and the question
is whether the notice was in accordance with r. 75-A
(2).
Rule 75-A(2) provides that after the property
has been requisitioned the Government may acquire
it by serving on the owner thereof a notice stating
thattthe Government has decided to acquire it.
Further sub-r. (3) of r. 75-A lays down that where a notice
of acquisition has been served on the owner, then at
the beginning of the day on which the notice is so
served the property shall vest in Government free
from any mortgage, pledge, lien or other similar
encumbrance and the period of the requisition thereof
shall _end.
Sub-rule (2) therefore requires that there
should be a service of the notice of acquisition on the
owner of the property requisitioned. Two questions
therefore immediately arise in view of the provisions
of r. 75-A (2), namely, (1) that there should be a
service of the notice on the owner, and (2) that this
service should be in accordance with r. 75-A (2). If
both these conditions are satisfied, r. 75-A (3) comes
into play and the property vests in the Government
as provided therein.
The first question therefore that arises is whether
the notice in this case was served on the owner of the
requisitioned goods. The argument on behalf of the
defendants is that the requisitioned goods did not belong to the mills and that the real owners were the
holders of the pucca delivery orders, and as there
was no service of notice on them, there could be no
acquisition under r.