# LEKHRAJ SATRAMDAS, LALV ANI v. DEPUTY CUSTODIAN-CUM-MANAGING OFFICER & ORS

- **Citation:** [1966] 1 S.C.R. 120
- **Court:** Supreme Court of India
- **Decided:** 1965-05-04
- **Case number:** Civil Appeal Nos. 414c 416 of 1963
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/lekhraj-satramdas-lalv-ani-v-deputy-custodian-cum-managing-officer-ors-3474
- **Pages:** 8

## Headnote

120
LEKHRAJ SATRAMDAS, LALV ANI
v.
DEPUTY CUSTODIAN-CUM-MANAGING OFFICER & ORS.
May 4, 1965
·[A. Jo.:. SARKAR, M. HJI>AYATl.:I.I.AI! Al'O V. RAMASWAMI, JJ.J
Ad11Unistratio11 of £\•acuee Properly Act 1950, s. 10(2) (b)-Alanacer
for evacuee shops appv/nied by Deputy Cuslotiiai1 of Evacuee Properly-·
Dtpury Cur1odian whe1her can cancel appoinunent subsequently.
The appellant was appointed Manager of two evacuee •hops which
vcr;ted in the Custodian of Evacuee Property. '!be appointment was made
in 1952 under s. 10(2) (b) of the Administration of EYacuec Property Act,
1950. In 1956 the appellant was informed hy letter Ex. p.8 writlen hy tile
Custodian of Evacuee Property that a decision to allot the shops to him
had been taken and that subscqucnUy the shops would be sold to him.
The letter was based on the orders of the Chief SetUement C.ommissiooer
in Ex. p. 5.
llowevcr the said de.:ision could not he implemented and in
punuance of orders from the Chief Setllemoot Omunissioner the Deputy
Custodian hy Ex. p. 13 and proceedings Ex. p. 16 cancelled the appointment of the appellant as Manager and asked him to hand over pos""8ioo
of the shops. The a?inllant tiled a writ petition in the High Coun praying
that the order Ex. p. 13 and proceedings p. 16 be
quashed, that the
possession of the shops be given to him, and that the sale of the shops be
llDpped. The High Court gr:wted the first two prayers but not the third.
Both parties appealed to a Division Bench of the High C-Ourt which held
apin.•t the appellant on all these counts. By cenificatc under Art. 133 (I) (a)
he came to the Supreme Court.
It was cont.ended on behalf of the appellant : (I) that he was not
lawfully removed from the management of the shol"' as the Deputy Custodian had no power to cancel an appointment, (2) that the ordor of
removal in Ex. 13 and Ex. 16 was made by the Managing Officer cum
Deputy Custodian of Evacuee property under the Displaced Per;ons (Com·
pensation and Rchabili:ation) Act 1954 which conferred M
power on
•uch an officer to cancel the appointm<:r.t of the manager and (3) that hy
virtue of Ex. p. 5 and F.x. p. 8 ·the shops s1ood allotted to the "ppollant.
HELD ; (i) Section 16 of the General Qauscs Act provides that the
power to terminate is a necessary ~i<ljunct of the power of appointnlCnt an<l
ii, exercised as an incident to or consequence of that power. ·The power of
appointment conferred on the Cu'1o<l1an under s. 10(2)(h) of the 1950 Act
confers by implication upon the Custodian the power to suspend or dismis."
any person appointed. It is manifest that the mauagemcnt of the appellant
with regard to the business oonccrn.c,. could be lawfully terminated "Y the
Deputy Custodian by ,;nuc of s. 10(2)(b) of the 1950 Act read with
s. 16 of the General Clauses Act. [124 F-G]
(ii) The order cancelling the appellant's appointment a.~ man:1gcr could
not be said to be invalid on the ground that it purponed to have bcco
made under the J 954 Act. The Act of 1950 was not repealed by the Act
of 1954 and continued in force.
Under s. 10(2)(b) of the 1950 Act the
Deputy Custodian is the proper authority to cancel the appointment of
a manager and the order of cancellation must therefore be held to be
valid.
The principle is that the act of public servant must be ascribed
to an :ictual exi.~ting authority under which it would have validity rather
th•n one under which it would be void. ! 125 C-EJ
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II
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SATRAMDAS v. DY. CUSTODIAN (Ramaswami, J.)
121
A
Ba/akotaiah v. The Union of India, [1958] S.C.R. 1052, referred to. -
B
(iii) Even on the assumption that the order of cancellation was i!lepl
the appellant was not entitled to a writ from the High Court. Writs can
be i=ed only to enforce the performance of statutory duties, not duties
under a contract.
The appointment of the appellant \\'as under a contract [126 A-BJ
Commissioner of Income-tax Bombay Presidency and Aden v. Bombay
'frwt Corporation Ltd., 63 I.A. 408 and P. K. Banerjee \·. L. J.

## Text

120
LEKHRAJ SATRAMDAS, LALV ANI
v.
DEPUTY CUSTODIAN-CUM-MANAGING OFFICER & ORS.
May 4, 1965
·[A. Jo.:. SARKAR, M. HJI>AYATl.:I.I.AI! Al'O V. RAMASWAMI, JJ.J
Ad11Unistratio11 of £\•acuee Properly Act 1950, s. 10(2) (b)-Alanacer
for evacuee shops appv/nied by Deputy Cuslotiiai1 of Evacuee Properly-·
Dtpury Cur1odian whe1her can cancel appoinunent subsequently.
The appellant was appointed Manager of two evacuee •hops which
vcr;ted in the Custodian of Evacuee Property. '!be appointment was made
in 1952 under s. 10(2) (b) of the Administration of EYacuec Property Act,
1950. In 1956 the appellant was informed hy letter Ex. p.8 writlen hy tile
Custodian of Evacuee Property that a decision to allot the shops to him
had been taken and that subscqucnUy the shops would be sold to him.
The letter was based on the orders of the Chief SetUement C.ommissiooer
in Ex. p. 5.
llowevcr the said de.:ision could not he implemented and in
punuance of orders from the Chief Setllemoot Omunissioner the Deputy
Custodian hy Ex. p. 13 and proceedings Ex. p. 16 cancelled the appointment of the appellant as Manager and asked him to hand over pos""8ioo
of the shops. The a?inllant tiled a writ petition in the High Coun praying
that the order Ex. p. 13 and proceedings p. 16 be
quashed, that the
possession of the shops be given to him, and that the sale of the shops be
llDpped. The High Court gr:wted the first two prayers but not the third.
Both parties appealed to a Division Bench of the High C-Ourt which held
apin.•t the appellant on all these counts. By cenificatc under Art. 133 (I) (a)
he came to the Supreme Court.
It was cont.ended on behalf of the appellant : (I) that he was not
lawfully removed from the management of the shol"' as the Deputy Custodian had no power to cancel an appointment, (2) that the ordor of
removal in Ex. 13 and Ex. 16 was made by the Managing Officer cum
Deputy Custodian of Evacuee property under the Displaced Per;ons (Com·
pensation and Rchabili:ation) Act 1954 which conferred M
power on
•uch an officer to cancel the appointm<:r.t of the manager and (3) that hy
virtue of Ex. p. 5 and F.x. p. 8 ·the shops s1ood allotted to the "ppollant.
HELD ; (i) Section 16 of the General Qauscs Act provides that the
power to terminate is a necessary ~i<ljunct of the power of appointnlCnt an<l
ii, exercised as an incident to or consequence of that power. ·The power of
appointment conferred on the Cu'1o<l1an under s. 10(2)(h) of the 1950 Act
confers by implication upon the Custodian the power to suspend or dismis."
any person appointed. It is manifest that the mauagemcnt of the appellant
with regard to the business oonccrn.c,. could be lawfully terminated "Y the
Deputy Custodian by ,;nuc of s. 10(2)(b) of the 1950 Act read with
s. 16 of the General Clauses Act. [124 F-G]
(ii) The order cancelling the appellant's appointment a.~ man:1gcr could
not be said to be invalid on the ground that it purponed to have bcco
made under the J 954 Act. The Act of 1950 was not repealed by the Act
of 1954 and continued in force.
Under s. 10(2)(b) of the 1950 Act the
Deputy Custodian is the proper authority to cancel the appointment of
a manager and the order of cancellation must therefore be held to be
valid.
The principle is that the act of public servant must be ascribed
to an :ictual exi.~ting authority under which it would have validity rather
th•n one under which it would be void. ! 125 C-EJ
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G
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SATRAMDAS v. DY. CUSTODIAN (Ramaswami, J.)
121
A
Ba/akotaiah v. The Union of India, [1958] S.C.R. 1052, referred to. -
B
(iii) Even on the assumption that the order of cancellation was i!lepl
the appellant was not entitled to a writ from the High Court. Writs can
be i=ed only to enforce the performance of statutory duties, not duties
under a contract.
The appointment of the appellant \\'as under a contract [126 A-BJ
Commissioner of Income-tax Bombay Presidency and Aden v. Bombay
'frwt Corporation Ltd., 63 I.A. 408 and P. K. Banerjee \·. L. J. Simonds,
A.LR. 1947 Cal. 307 referred to.
(iv) Ex. 5 and Ex. 8 did not make any final allotment in favour of
the appellant.
1l1c letters did not show any concluded contract of sale.
[127 A-Bl
CIVIL APPELLATE JURISDICTION :
Civil Appeal Nos. 414c
416 of 1963.
Appeals from the judgment and order dated December 6, 1960
of the Kerala High Court in A.S. Nos. 445 and 484 of 1960.
R. Mahallngier and K. N. Kcswai, for the appellant (In both
the appeals):
D
Gopal Singh, R. N. Sachthey and B. R. G. K. A char, for the
Respondents (In both the appeals).
The Judgment of the Court was delivered by
Ramaswami. J.
The proprietors of two firms styled "Adam
E Haji Peer Mohd. Essack" and "Haji Ebrahim Kasim Cochinwala"
had, in the year 194 7, migrated to Pakistan and both these firms
became vested in the Custodian of Evacuee Properties for the State
of Madras under s. 8 of the Administration of Evacuee Property
Act, 1950, hereinafter referred to as the 1950 Act. On March 6,
1952 the appellant was appointed as Manager of the two firms
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under s. 10(2) (b) of the 1950 Act. The appellant also furnished
security of Rs. 20,000/- before taking possession of the business
of the firms as Manager.
The order of appointment-Ex. P-1
dated March 6, 1952 states :
"The Custodian approves the proposal of the Deputy
Custodian, Malabar that the Management of both the
firms of Adam Hajee Peer Muhammad Issack and Hajee
Ibrahim Kassam Cochinwala at Kozhikode may be allotted to Sri L. S. Lalvani for the present on the same system as exists now between the Government and the present two managers and on his furnishing a security of
Rs. 20,000 to the satisfaction of the Deputy Custodian. The question of outright allotment as contemplated
in Custodian General's letter No.
2811 /CG/50
dated 20-3-50 will be taken up in due course."
122
SUPllEMB COURT REPORTS
[1966) l S.C.R.
On October 9, 1954 the Displaced Persons (Compensation and
A
Rehabilitation) Act, 1954 was passed which will hereafter be
referred to as the 1954 Act.
On April 11, 1956 there was an
advertisement published in the Press for the sale of the aforesaid
evacuee properties. The appellant applied to the Chief Settlement
Commissioner for stopping the sale of the two concerns.
On
April 25, 1956 the Central Government made an order-Ex. P-5
B
-which states :
"I am directed to state that it has been decided in
principle that the aforesaid evacuee concerns will be
allotted to you. The terms of allotment will be communicated to you separately. Meanwhile, you will continue
C
to function as the Custodian's Manager for these concerns
in terms of section 10(2) (b) of the Administration of
Evacuee Property Act, read with Rule 34 of the rules
made under the Act."
On June 21, 1956 another letter-P-8-was written to the appclD
!ant by the Custodian of Evacuee Properties which states :
"The Deputy Custodian is informed that the Government of India have decided that the two evacuee concerns viz., firms of Adam Hajee Peer Mohammed Essack
and Hajee Ebrahim Kassam Cochinwala of Kozhikode
are to be allotted to the present Manager Shri L. S.
Lalvani and ultimately sold to him. He is also informed that until the question of terms and conditions of
allotment of the concerns in quesiion is decided Shri
Lalvani will coniinue to function as Custodian's Manager for these concerns in terms of Section 10(2) (b) of
the Administration of Evacuee Property Act, 1950 read
with rule 34 of the rules made thereunder. The Deputy
Custodian is requested to evaluate the business concerns
properly after getting prepared a balance sheet of each
year of the vesting of the concerns, evaluating the concerns, the Deputy Custodian should keep in view the
other assets and liabilities of the concerns and their goodwill etc.
His comment and suggestions as to how and
by what easy instalments the value of the concerns if
sold to Shri Lalvani is to be realised from him should
also be intimated.
E
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The bargain was not concluded and on March 25, 1958 there wa.~ H
an advertisement in the Press about the public auciion of the business of the firms. The appellant moved the High Court of Kerala
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SATRAMDAS v. DY. CUSTODIAN (Ramaswami, J.)
123
for grant of a writ restraining the District Collector from selling
the business of the firms by a public auction.
The application
was allowed and on June 25, 1959 the Kerala High Court directed
the District Collector not to sell the properties of the business of
the two firms without an appropriate order of the Chief Settlement
Commissioner. The decision of the High Court is based upon the
ground that there was no order under the 1954 Act by the Chief
Settlement Commissioner for sale of the properties and that in the
absence of such an order the sale of the properties cannot take
place. It appears that the order of the Chief Settlement Commissioner was subsequently made on September 15, 1959. In pursuance of that order the management of the appellant wa~ terminated and the possession of the business was taken over by the
Deputy Custodian-Respondent no. 1. The order-Ex. P-13dated December 18, 1959 states :
"Shri L. S. Lalvani is informed that his services as
Manager of the business concerns of Adam Haji Peer
Mohd. Essack and Haji Ibrahim Kassam, Cochinwala,
at Kozhikode, are hereby terminated with immediate
effect.
He is further required to hand over immediate
possession of the premises and the stock-in-trade, account
books and other assets of the business including furniture
etc."
The appellant filed a writ petition in the High Court of Kerala
-being 0.P. no. 1438 of 1959 for grant of ( 1) a writ of certiorari for quashing the order dated December 15, 1959-Ex. P-13
-and the proceedings dated December 18, 1959-Ex. P-16, (2)
a writ of mandamus directing respondents nos. 1 and 2 to hand
over possession of the two business concerns including the premises, stock-in-trade all records etc. to the appellant, and (3) a
writ of mandamus or appropriate writ or order directing respondents nos. 1 to 3 not to sell by public auction or otherwise the
two evacuee business concerns.
S.
Velu Pillai, J. by his order
dated June 8, 1960, granted writ to the appellant as prayed for
in prayer ( 1) & (2) but refused prayer (3) for a writ of mandamus
restraining the respondents from selling the business by public
auction.
Against the order of the Single Judge the respondents
filed an appeal being A.S. no. 484 of 1960 before the Division
Bench of the High Court.
The appellant also preferred an
appeal A.S. no. 445 of 1960 against the order of Single Judge
which was in regard to the refnsal of the third relief.
By judgment dated December 6, 1960 the Division Bench of the High
LSSup. CJ/65-9
124
SUPllEMB COUllT llEPORTS
[ 1966] I S.C.R.
Court dismissed Appeal A.S. no. 445 of 1960 filed by the appelA
I.ant but allowed the appeal A.S. no. 484 of 1960 filed by the
respondents.
The present appeals are brought on behalf of the
appellant by certificate of the Kerala High Court granted under
Art. 133(l)(a) of the Consl'itution.
The first question arising in this case is whether the appellant
B
was lawfuUy removed from the management of the business by
the order of the respondent no. 1 dated December 18, 1959Ex. P-13 and P-16. It was submitted on behalf of the appellant
that under s. 10(2)(b) of the 1950 Act the Custodian had the
power to appoint a Manager for the Evacuee Property for carrying on any business of the evacuee and there was no power conC
ferred by the Act upon the Custodian to remove the Manager so
appointed.
It was argued by the Counsel on behalf of the appellant that an indefeasible right of management was conferred upon
the appellant because of the order of the Custodian-Ex. P-1
dated March 6, 1952. In our opinion, there is no warrant for
this argument.
The power of appointment conferred upon the
D
Custodian under s. 10(2)(b) of the 1950 Act confers, by implication, upon the Custodian the power to suspend or dismiss any
person appointed.
Section 16 of the General Clauses Act states :
"Where, by any Central Act or Regulation, a power
to make any appointment is conferred, then, unless a
E
different intention appears, the authority having for the
time being power to make the appointment shall also
have power to suspend or dismiss any person appointed
whether by itself or any other authority in exercise of
that power."
r
It is manifest that the management of the appellant with regard
to the business concerns can lawfully be terminated by the Deputy
Custodian by virtue of s. 10(2)(b) of the 1950 Act read with
s. 16 of the General Clauses Act. The principle underlying the
section is that the power to terminate is a necessary adjunct of
the power of appointment and is exercised as an incident to or
consequence of that power.
It was then contended on behalf of the appellant that the
order of removal-Ex. P-13 and P-16-was made by the Managing Officer-cum-Deputy Custodian of Evacuee Property of Southern States under the 1954 Act which conferred no power on such
an officer to cancel the appointment of a Manager. It was pointed
out that the order of removal was made after the provisions of
the 1954 Act had come into force.
In our opinion, there is no
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SATRAMDAS V. DY. CUSTODIAN (Ramaswami, !.)
125
A justification for this argument.
We shall assume that the Manag·
ing Officer under the 1954 Act is not the proper authority to
cancel the appointment of a Manager but it is not disputed that
the provisions of the 1950 Act have not been repealed and still
continue to be in force.
Under s. 10(2)(b) of the 1950 Act the
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Deputy Custoclian is the proper authority to cancel the appointment of a Manager and the order-Ex. P-13 and P-16 dated
December 18, 1959 is, therefore, legally valid.
It is true that
the order Ex. P-13 and P-16 is signed by Mr. Mathur as "the
Managing Officer-cum-Deputy Custodian of Evacuee Property"
but the order of removal of the appellant from the management
is valid because Mr. Mathur had the legal competence to makti
the order under the 1950 Act, though he has also described him·
self in that order as "Managing Officer".
It is well-established
that when an authority passes an order which is within its competence, it cannot fail merely because it purports to be made
under a wrong provision if it can be shown to be within its power
D under any other rule, and the validity of the impugned order
should be judged on a consideration of its substance and not of
its form.
The principle is that we must ascribe the Act of a
public servant to an actual existing authority under which it would
have validity rather than to one under which it would be void
E
(See Balakotaiah v. The Union of India.) (1 ) We, therefore, reject
the argument of the appellant on this aspect of the case.
In our opinion, the order of the Deputy Custodian-P-13 and
P-16-removing the appellant from the management of the business is not vitiated by any illegality. But even on the assumption
that the order of the Deputy Custoclian terminating the manageF ment of the appellant is illegal, the appellant is not entitled to
move the High Court for grant of a writ in the nature of mandamus
under Art. 226 of the Constitution. The reason is that a writ
of mandamus may be granted only in a case where there is a
statutory duty imposed npon the officer concerned and there is a
failure on the part of that officer to discharge that statutory obliG gation. The chief function of the writ is to compel the performance of public duties prescribed by statute and to keep the subordinate tribunals and officers exercising public functions within
the limits of their jurisdictions. In the present case, the appointment of the appellant as a Manager by the Custodian by virtue
of his power under s. 10(2)(b) of the 1950 Act is contractual
H
in its nature and there is no statutory obligation as between him
and the appellant. In our opinion, any duty or obligation falling
(I) [1958] S.C.R. 1052 at p. 1059.
126
SUPREME COURT REPORTS
[1966] I S.C.R.
upon a public servant out of a contract entered into by him as
A
such public servant cannot be enforced by the machinery of a
writ under Art. 226 of the Constitution.
In Commissioner of
Income-tax Bombay Presidenty and Aden v. Bombay Trust Cor-
•
poration l.td. ( 1 ) an application was made under s. 45 for an order
directing the Commissioner to set aside an assessment to income
tax and to repay the tax paid by the applicant; the Bombay High
B
Court made the order asked for but the decision of the Bombay
High Court was set aside by the Judicial Committee.
At page
427 of the report it is observed hy the Judicial Committee :
'"Before mandamus can issue to a public servant it
mu1t therefore be shown that a duty towards the appliC
cant has been Imposed
upon
the public servant by
statute so that he can be charged thereon, and independently of any duty which as servant he may owe
to the Crown. his principal."
A simi!ar view has been expressed by the Calcutta High Court in
l'. K. H1111erjee v. L. 1. Simonds.(')
In our opinion. these cases
D
lay down the correct law on the point.
We pa" on to cdnsider the next question presented on behalf
of the appellant vi~ .. whether there was a final allotment of the
business in favour of the appellant by the Chief Settlement Commissioner.
It was contended for the appellant that in view of
L
Ex. P-5 dated April 25, 1956 there was final allotment of the
business, though the terms of allotment had to be subsequently
detem1ined.
In Ex. P-5 the Government of India state that "It
has been decided in principle that the aforesaid evacuee concerns
should be allotted to you" and the "terms of allotment would
be communicated to you separately".
Reference was made to
F
Ex. P-8 dated June 21, 1956 wherein it is stated that the Government of Indi:i have decided that "the two evacuee concerns viz ..
firms of Adam Hajee Peer Mohammed Essack and Hajee Ebrahim
Kassam Cochinwala of Kozhikode are to be allotted to the present
Manager Shri L. S. Lalvani and ultimately sold to him". It is
also mentioned in the letter that "until the question of terms and
G
conditions of allotment of the concerns is decided Shri Lalvani
will continue to function as Custodian's Manager for these concerns in tern1s of s. 10(2)(b) of the Administration of Evacuee
Property Act, 1950 read with rule 34 of the rules made thereunder".
It was submitted on behalf of the appellant that in view
of these two letters it must be held that there was a final allotII
mcnt of the business in favour of the appellant.
We do not.
(I} 63 I.A. 408.
(~) A.LR. t947 Cal. 307.
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SATRAMDAS v. DY. CUSTODIAN (Ramaswamy,!.)
127
however, think there is any justification for this argument.
It is
manifest that
the terms and conditions of allotment were not
finally settled between the parties and there was no concluded
contract of sale and, therefore, the appellant had no legal right
to the business of the two concerns and the High Court was right
in holding that the appellant was not entitled to the grant of a
writ in the nature of mandamus with regard to the possession
of the two business concerns.
In our opinion, there is no merit in these appeals which are
accordingly dismissed with costs.
Appeals dismissed.