# N. SATYANATHAN v. K. SUBRAMANY AN AND OTHERS

- **Citation:** [1955] 2 S.C.R. 83
- **Court:** Supreme Court of India
- **Decided:** 1952-12-14
- **Case number:** Civil Appeal No. 252 of 1954
- **Bench:** Vivian Bose, Jagannadhadas, Sinha
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/n-satyanathan-v-k-subramany-an-and-others-1517
- **Pages:** 12

## Headnote

Representation of the People Act, 1951 (Act XLlll of 1951), s.
7( 4)-Appellant entered into agreel'T}ent. with Central Government
for conveying postal articles and mail bags through Motor Vehicle
Sel'vtce on certain remuneration-Appellant whether disqualified for
election to the House of People under s. 7(d) of .the Act.
The question for determination in this appeal was whether the
appellant was disqualified under s. 7(d) of the Representation of the
People Act, 1951 for election to the House of the People.
The material portion of s. 7(d) of the Act reads as follows:
"A person shall be disqualified for being chosen as and for
being, a member of either House of Parliament .... (b) if, whether by himself or by any person or body of persons in trust for
him or for his benefir or on his account, he has any share or interest
in a contract for .... the performance of any service undertaken
by the appropriate Government".
The appellant (a contractor) had entered into an agreement with
the Central Government. The relevant portion of the said agreement was as follows: -
"The contractor has offered to contract with the GovernorGeneral for the provision of a MoMr Vehicle Service for the transit
conveyance of all postal articles and mail bags from December 15,
1949 to December 14, 1952 and the Governor-General has accepted
the offer.
"The Government agrees to pay to the contractor Rs. 200 per
month during the subsistence of the agreement 'as his remuneration
for service to be rendered by him".
Held that on the face of it the agreement was between two competent parties with their free consent, and there was a lawful cash
consideration for it. The Appellant entered into the agreement with
his eyes open knowing full well his rights and liabilities under the
same.
Si11/za J
1955
March 29
84
SUPREME COURT REPORTS
[1955]
The case was a staightforward illustration of the kind of contract contemplated by s. 7( d) of the Act. At all material times the
}If. Satya11athan _
v.
appellant had been directly concerned, for his own benefit, in the
/9jj
K. Subramanyan contract of carrying mail bags and postal arti.cles entered into by
and others
him· with the Government in the Postal Department.
Section 7 of the Act is clearly intended to avoid a conflict between public duty and private interests.

## Text

2 S.C.R.
SUPREME COURT REPORTS
83
circumspect enough to insert any such alternative
195~
clause as would have given the judgment or order of Tlze Sta~;-;,! JJ.ihar
this Court the same effect as is contemplated by the
M v.
.
terms of the surety bond quoted above.
011J !,~~;:er
The appeal must therefore be dismissed in limine.
Appeal dismissed.
N. SATYANATHAN
v.
K. SUBRAMANY AN AND OTHERS.
[VIVIAN BOSE, JAGANNADHADAS AND SINHA JJ.]
Representation of the People Act, 1951 (Act XLlll of 1951), s.
7( 4)-Appellant entered into agreel'T}ent. with Central Government
for conveying postal articles and mail bags through Motor Vehicle
Sel'vtce on certain remuneration-Appellant whether disqualified for
election to the House of People under s. 7(d) of .the Act.
The question for determination in this appeal was whether the
appellant was disqualified under s. 7(d) of the Representation of the
People Act, 1951 for election to the House of the People.
The material portion of s. 7(d) of the Act reads as follows:
"A person shall be disqualified for being chosen as and for
being, a member of either House of Parliament .... (b) if, whether by himself or by any person or body of persons in trust for
him or for his benefir or on his account, he has any share or interest
in a contract for .... the performance of any service undertaken
by the appropriate Government".
The appellant (a contractor) had entered into an agreement with
the Central Government. The relevant portion of the said agreement was as follows: -
"The contractor has offered to contract with the GovernorGeneral for the provision of a MoMr Vehicle Service for the transit
conveyance of all postal articles and mail bags from December 15,
1949 to December 14, 1952 and the Governor-General has accepted
the offer.
"The Government agrees to pay to the contractor Rs. 200 per
month during the subsistence of the agreement 'as his remuneration
for service to be rendered by him".
Held that on the face of it the agreement was between two competent parties with their free consent, and there was a lawful cash
consideration for it. The Appellant entered into the agreement with
his eyes open knowing full well his rights and liabilities under the
same.
Si11/za J
1955
March 29
84
SUPREME COURT REPORTS
[1955]
The case was a staightforward illustration of the kind of contract contemplated by s. 7( d) of the Act. At all material times the
}If. Satya11athan _
v.
appellant had been directly concerned, for his own benefit, in the
/9jj
K. Subramanyan contract of carrying mail bags and postal arti.cles entered into by
and others
him· with the Government in the Postal Department.
Section 7 of the Act is clearly intended to avoid a conflict between public duty and private interests.
CIVIL APPELLATE JURISDICTION: Civil Appeal No.
252 of 1954.
Appeal by Special Leave from the Judgment and
Order dated the 22nd January 1953 of the Election
Tribunal, Yellore in
Election
Petition
No. 35 of
1952.
N. C. Chatterjee (A. N. ·Sinha and N. H. Hingorani, with him), for the appellant.
C. V. L. Narayan, for respondent No. I.
1955. March 29. The Judgment of the Court was
delivered by
SINHA J.-The only question for determination in
this appeal by special leave is whether the appellant
is disqualified under section 7(d) of the Representation of the People Act, 1951
(hereinafter called the
Act) for election to the House of the People, as held
by the Election Tribunal, North Arcot, Vellore,
by
its orders dated the 20th January, 1953 in Election
Petition No. 35 ol' 1952.
The facts of this case are not in dispute and lie vvithin a narrow compass. The appellant and respondents
I to 3 contested the last general elections from the
Dharmapuri Parliamentary Constituency in the district of Salem in the State of Madras. Respondents
4 to 10 who were added subsequently by an order of
the Tribunal were also candidates for election. Their
nominations also had been held to be valid but thev
ultimately withdrew their
candidature
before
the
polling took place. The appellant was in due course
declared to have been elected to the House of the
People Thereafter; on the 5th
March, 1952 the I st
respondent filed an election petition before the Election Commission contesting the appellant's election
2 S.C.R.
SUPREME COURT REPORTS
85
on the ground that the
appellant was
disqualified
~:!.
under section 7(d) of the Act as, from the date of his . N Satyanathan
nomination and until the date of election and after, K. subr;-,,,anyQll
the appellant had a contract with the Government of
and others
India in the Postal Department for the transport of
Sinha 1.
postal mail which was a service undertaken by the
Government of India. At this stage it is necessary
to state that it is admitted that the appellant is and
ha~ been the holder of a stage carriage service permit
(Ex. B-2) dated the 26th April 1949, issued by the
Regional Tramport · Authority, Salem,
Madras. It
was one of the cpnditions of the said permit that if
called upon the appellant will enter into an agreement
with the Government of India for the . transport of
postal articles and mail bags. In pursuance of that
obligation the appellant entered into . a registered
agreement with the Government o( India on the 16th
November 1949 (Ex. A-3) to be noticed in detail heremafter. After the appellant had filed his nomination
paper; the 1st respondent by his petition dated
the
28th November 1951 raised the objection to the effect
that his nomination should be rejected on the ground
that he had entered into a contract with the Government of India for his own benefit for the transport of
mail betwc;:en Salem and
Yercaud. The
Returning
Officer for the Dharmapuri Parliamentary Constituency, Salem, by his orders (Ex. A-2) of the same date
overruled the objection holding that the service rendered by the appellant of carrying mail is not under
an agreement but on an imperative order of the Government under Rule 160-B of the Madras Motor Vehicles Rules. Apparently the registered agreement (Ex.
A-3) had not been placed before him.
To the election petition filed by the 1st respondent
the appellant filed his written statement on the 28th
May 1952 denying that he was disqualified for election
as
~. member of Parliament by virtue of the provisions of section 7(d) of the Act. His contention was
that "it is the exdusive privilege of the Government
of India to convey all postal articles from one place
to another and it is a normal function of the Government statutorily reserved to itself. There is no justifi12-8 SCI/ND/82
1955
N. Satyanatha11
v.
K. Suhramanyan
a11d others
Sinha J.
86
SUPREME COURT REPORTS
[1955]
cation to regard the carrying of mails from one place
to another as the performance of any service undertaken by the Government". It was further averred on
behalf of the appellant that it was not justifiable to
regard him as having any interest in a contract for
the performance of any service
undertaken by the
appropriate Government within the mischief of section 7(d) of the Act; and that he had been only carrying out the obligations
imposed upon him by Rule
160-B of the rules framed under the Motor Vehicles
Act. It was also contended that under article 103 of
the Constitution of India the question as to the disqualification ·Of a member has to be decided by the
President whose decision shall be final.
On those pleadings the following issues were
framed by the Election Tribunal:-
!. Is the nomination of the 1st respt. invalid
because of the prohibition contained in section 7(d)
of the Representation of the People Act, 1951, or for
any of the reasons set forth in paras. 9 to 11 of the
petition?
2. Has this Tribunal no jurisdiction td decide
the question as
regards the
disqualification of the
returned candidate, because of article 103 of the
Constitution of India?
·
Tt is not necessary to refer to the additional issue
bearing on the question of limitation arising from an
interlocutory application for impleading those candidate~ <respondents 4 to W) whose nomination had
heen accepted but who had withdrawn from the contest. Both these issues were decided against the appellant. The Tribunal on a very elaborate discussion
of the· points raised before· it. held that the postal
service including the transport of mails is ~ service
undertaken by the Central Government within the
meaning of section 7(d); that at tlie date of the nomination the appellant was
a contractor under the
Centr.al Government; that the agreement between the
Government and the appellant involved mutual obligations which could rtot be referable to a bare statutory duty on the part of the appellant but that it
was the result of mutual assent based upon a free
2S.C.R.
SUPREME COURT REPORTS
87
offer and
acceptance; and
that the agreement was
supported by valid consideration. The Tribunal also
held that article 103 of the Constitution was not a
bar to its jurisdiction to decide the controversy.
Accordingly it allowed the election petition and held
the appellant's election to be void in terms of section
100(1)(c) of the Act, with costs to the respondent.
Hence this appeal.
In this appeal the contentions raised before the
Election Tribunal, except the objection to the Tribunal's jurisdiction in view of the provisions of article
103 of the Constitution, have been pressed before us
by the learned. counsel for the appellant. It is manifest
that the determination of this case must depend upon
the true construction and legal effect of the agreement (Ex. A-3) admittedly entered into by the appellant with the Central Government. It is
therefore
necessary to set out in some detail the revelant clauses
of the agreement.
The appellant
(called the "contractor") is of the one part and the Governor-General
of India of the other. The preamble says-
"Whereas the said contractor Sri. N. Sathianathan has offered to contract with Governor-General
for the provision of a Motor Vehicle Service for the
transit conveyance and delivery of all postal articles
and mail bags as defined in the Indian Post Office Act,
1898, as amended from time to time, ...... from the
15th day of December 1949 to the 14th day of December 1952 and the Governor-General has accepted such
offer upon the terms and conditions hereinafter appearing ...
Now this indenture
witnesseth
that the
contractor in pursuance of the said agreement and
in
consideration of the premises and of the payments
hereinafter agreed to be made to him ...
It is hereby mutually agreed and declared between and by the part.ies hereto as follows: -
l. Contract to carry: -The contractor shall during the continuance of this contract. that is to say,
from the 15th day of December 1949 until the 14th
day of December 1952 or until the said contract shall
be determined by such notice as is hereinafter men1955
N. Sa1ya11a1/11m
v.
K. Subru11ia11ya11
and others
Sinha J.
1955
JV. Satyanathan
v.
K. Suhramanyan
and others
Sinha J.
88
SUPREME COURT REPORTS
[1955
tioned or otherwise in (hereinafter referred to as the
said contract period) duly and safely convey ......... by
means of rpotor vehicles of good and reliable manufacture all postal articles and mail bags ....... ".
By clause 4 the contractor is permitted to carry passengers and their luggage by bus provided there is
accommodation available .and provided that the mail
service is not prejudiced in any way.
By clauses 5
and 6 the contractor is required to maintain in good
order and repair a number pf motor buses and their
spare parts at his own expense and to bear all municipal and other taxes payaqle in respect of the motor
vehicles. Clause 7 contains the schedule of penalties
in the event of non-completion of any journey or of
delay in completion thereof in accordance with
the
time table, etc. By clause 8 the contractor is made
absolutely liable and responsible for the due and safe
custody and delivery in good order and condition of
postal articles and mail bags.
By
clause 10 nongazetted postal and telegraph officers travelling
on
duty on the route allotted to the appellant are declared to be entitled to travel free of all charges and
such official passengers shall have precedence over
ordinary passengers.
Clause 13 provides that
the
contract shall not be transferred by the contractor to
any person or company without the previous consent
in writing of the Director-General of Posts & Telegraphs.
By clause 15 the
Government agrees to
pay to the contractor Rs. 200 per month during the
subsistence of the
agreement "as his remuneration
for service to be rendered by him hereunder". This
monthly sum of Rs. 200 is liable to be increased or
decreased proportionately to the increase or decrease
in the mileage to be covered. Clause 18 is in these
terms:-
"In t"1e event of the contractor failing to secure
a renewal of the permit on the line this contract will
automatically terminate on the date up to which the
old permit shall be valid and in such case no compensation shall be payable to either party for such
termination. This contract may be absolutely determined and put an end to by either of the contracting
2 S.C.R.
SUPREME COURT REPORTS
89
parties giving four calendar months notice in writing
to the other of his intention so to determine and put
an end to the same".
Clause 21 contains the usual arbitration clause to the
effect that all disputes and differences arising out of
or in any wise touching or concerning the agreement
shall be ref erred to the sole arbitration of the Director-General of Posts and Telegraphs or his nominee.
It is also provided that the award of the arbitrator
shall be final and binding on the parties.
lt will be observed that the agreement set out
above is a formally drawn up document which satisfies
all the requirements of a contract. It is not the appellant's case that the contract has been vitiated by
undue influence, fraud or such other cause. But it
has been argued that it was a necessary sequel to
the stage carriage permit granted by the Transport
Authority undec the Motor Vehicles Act read along
with the relevant rules. In this connection reference
was made to rule 160-B of the Madras Motor Vehicles
Rules which is as follows: -
"It shall be· a condition of every stage carriage
permit that the holder of the permit shall, if so required
by the transport authority which granted the permit,
carry mails at such rates and on such terms as the
transport authority may fix after consultation with the
holder of the
permit and the
postal authorities
concerned".
The rule quoted above has apparently been
made
under the authority of section 48(d) of the
Motor
Vehicles Act. It is common ground that the agreement aforesaid between the appellant and the Cen·
tral Government is in pursuance of rule 160-B aforesaid; but it has been argued on behalf of the appellant that though the agreement aforesaid has the
"semblance of a contract", it
is
lacking in
the
"essential ingredients of a free consensus of acceptance and offer".
This argument is based on
the
further contention that the appellant has been carrying mail on his buses in performance of a statutory
.obligation which cannot come within the mischief of
1955
.N. Satya11atlla11
v.
K. Subra111a11ya11
and others
Sinha J.
1955
JI/, Satya1tat/Ju11
v.
K. Subra1na11ya11
and others
Sinha J.
90
SUPREME COURT REPORTS
[1955]
section 7(d) of the Representation of the People Act,
1951. The material portion of the section is in these
terms:-.
"A person shall be disqualified for being chosen
as, and for being, a member Gf either House of Parliament ......
(b) if, whether by himself or by any person or
body of persons in trust for him or for his benefit or
on his account, he has any share or interest in a contract for ............ the performance of
any services
undertaken by the· appropriate Government". It has
further been argued alternatively that if the agreement
has
the force
of a contract, it is totally
lacking in consideration because the monetary consideration provided· for in the agreement is no more
than the subsidy already fixed by the Regional Transport Officer by his orqers dated the 23rd July, 1949;
that the agreement in question being with a third
party, namely, the Governor-General, to render service
which was already due to another party, namely, the
Transport Authority for the same consideration can·
not amount to a valid contract supported by consideration; and finally, that the transport of mail is not
a "service undertaken by the Central Government".
In our opinion, there is no substance in any one of
these contentions. It is
true that the appellant
entered into the contract aforesaid with the Central
Government for the transport of postal articles and
mail bags on the 16th November, 1949. From before
that date he had been carrying on the business of
plying buses on the route allotted to him by the
Regional Transport Authority.
But he entered into
the contract with his eyes open and knowing full well
his rights and liabilities under the same. No one is
compelled to carry on the business of stage carriage
service or for the matter of that, of transporting postal
articles and mail bags. In terms of the permit, it is
open to the Government to call upon a permit holder
to undertake the additional burden of carrying postal
articles and mail bags which carries with it the additional
remuneration to be
fixed by the Transport
Authority after consultation with the postal autho-
2 S.C.R.
SUPREME COURT REPORTS
91
rit~es and the carrier.
It is not every stage carriage
permit holder who is called upon to do so.
At the
time the appellant entered into the contract with the
Government in the postal
department he may not
have had any idea of standing for election to the
House of the People when in future the general elections came to be held. If he wished to steer clear of
the difficulty created by section 7 of the Act, he could
have given due notice to Government under clause 18
of the contract referred to above. On the expiry of
the term of the notice he would have been free to
stand for election to a State or Central Legislature.
Section 7 of the Act is clearly intended to avoid a conflict between public duty and private interest.
The Tribunal discussed a number of authorities
with reference to the English and the American Law
of Contract for arriving at the conclusion that the
agreement between the appellant and the Government
of India in the Postal Department had all the ingredients of a valid contract.
The Tribunal need not
have travelled so far afield, especially when the provisions of the Indian Contract Act which govern the
case are sufficient to answer all the contentions raised
on behalf of the appellant. On the face of the transaction the agreement was between
two competent
parties with their free consent. There was no question but that there was
lawful consideration. The
permit for the stage carriage had been granted by the
authority under the Motor Vehicles Act; and the agreement for transport of postal articles and mail bags
was between the Government of India in the Postal
Department and the appellant for a cash consideration.
But it was argued that the agreement was in pursuance of a pre-existing obligation imposed by the
rule aforesaid framed under the Motor Vehicles Act.
It is true that the permit does contain a condition
that the pel"mit-holder may be called upon to undertake transport of mail bags and postal articles but
that is only a notice
to intending applicaots for a
stage carriage permit that the grantee of such a permit may have to render that additional service for an
additional remuneration if called upon to do so hy the
/955
. \ ·. Sa1.i·cnwt/1a11
V.
K. Subramanran
and other.;.
Sinha J.
1955
}/. Satyanathan
v.
K. Sufwamanyan
and others
Sinha J.
92
SUPREME COURT REPORTS
[1955]
authorities of the Postal Department. If any
one
was not prepared to undertake that additional responsibility, he was free not to make an a"pplication
for such a permit; but that <loes not mean that the
agreement actually entered into between the Postal
Department and the permit holder is not an independent contract governed by its own special terms. As
indicated above, clause 18 has reserved the right to
either party to terminate the contract on giving four
months' notice. The appellant must be presumed to
have known that the agreement that he had entered
into with the Postal Department will stand in the
way of his running as a candidate for election to the
Central or the State Legislature. There was nothing
to prevent him from giving the necessary notice to
the department and thus terminate his agreement so
as to be free to stand as a candidate for elec1ion to
the legislature. Section 7 of the Act is intended to
ensure that there is no occasion for a conflict between
public duty and private interests. The appellant had
a clear and free choice before him. If he was anxious
to serve the community as a member of the Central
Legislature, he had to give up his· private gains in the
shape of the remuneration for carrying postal articles
and mail bags in his buses.
It may be that on his
terminating the agreement
with the postal
department he would have to give up his stage carriage permit also but n·ot necessarily so. lf on the same route
a number of bus services are permitted to different
parties, the Postal Department may choose any one
of them to enter into the agreem~nt for the carriage
of mail bags and postal articles.
Bat even if there
was only one service for the route in respect of which
the appellant held the stage carriage permit, if he
had to give up his permit, some other party would
take his place for running the bus service and carrying the postal articles and mail bags.
It was further argued that the appellant had no
hand in "the fixing of the remuneration to be paid by
the Postal
Department for carrying its
mails, etc.
But it is clear, by a reference to the terms of the rule
2 s.c.R.
SUPREME COURT REPORTS
93
quoted above, that the amount of the remuneration
had to be fixed by the department after con~ultation
with the carrier. It was always open to the latter to
demur to the terms proposed by the department and
if he found that the department was not prepared to
accept his terms he was not bound to enter into the
agreement. The fact that he had agreed to carry postal
articles and mail bags was possibly an
additional
qualification for him to ohtain a renewal of his permit
and thus gave him sn advantage over his competitors.
Hence instead of being an additional burden
or a handicap to him, it was an additional advantage
to him in the matter of getting a renewal of his permit in preference to others.
The
agreement
was
therefore based on mutual promises, by the appellant
to carry the mail bags. etc .. and by the Postal Department to pay him suitable remuneration for the services
thus rendered.
It was further contended on .behalf of the appellant
that the Central Government could not be said
to
have 'undertaken' any 'service' within the meaning of
section 7(d) of the Act when it made arrangements
· for the carriage of mail
bags
and postal articles
through the appellant. It has not been and cannot be contended that the Government is bound in
the discharge of its duties as a sovereign state to make
provision for postal mail service. The provisions of
the Indian Post Office Act, VI of 1898, are only
enabling in the sense that they authorize the State
agency to have the exclusive privilege of conveying
letters, etc. for the convenience of the public and for
the benefit of the Government, without making it
obligatory upon it to provide every individual and
every place
with
those facilities. It may be that
those facilities are being extended from time to
time and are being brought nearer to every home but
that is only evidence of the fact that the State as a
welfare state is anxious to provide for the conveniences of the public in the matter of communications
and correspondence. That is to say, the Government
in the Postal Department has only undertaken a service to be rendered to the community and that such
13-8 SCI/ND 182
19'5
N. 9'lt)'-*11
v.
K. SllllramM)'1111
lllld otben
Slnflo J,
fl)~
N. Satyt.JM1ho11
v.
f(. Subramanyan
and othtrs
Sinhs J.
1955
March 25
94
SUPREME COURT REPORTS
[l 955]
a service is not an essential function of a sovereign
sta·te. It cannot be rainsaid that the Government in
the Postal Department is rendering a very useful service
and
that the appellant has by his
contract
with the Government undertaken to render that kind
of service on a specified route. The present case is a
straightforward illustration of the kind of contract
contemplated by section 7(d) of the
Act.
At
all
material times the appellant has been directly concerned, for his own benefit, in the contract of carrying mail bags and postal articles entered into by him
with the Government in the Postal Department.
For the reasons aforesaid we have not the least
hesitation in holding that the conclusions arrived at
by the Tribunal are entirely correct.
The appeal is
accordingly dismissed with costs.
A ppeaf dismiu('(f.
U..T.S. CHOPRA
v.
STATE OF BOMBAY.
[S. R. OAS, BHAGWATI and IMAM JJ.]
Criminal Procedure Code, 1898 (Act V of 1898), s. 439(1)(2)!6)
-Appellant convicted by Magistrate-His appeal to High ·Court
dismissed summarily-After summary dismissal
of
that
appeal
Stat.J Government filed revision application to High Court for enhancernent of sentence-Notice issued to appellant to show cause
against enhanrnment under s. 439(2)-Whether appellant entitled to
show cause ai;ainst his conviction under s. 439!6) of Code of Criminal Procedure.
The appellant in this appeal was convicted by the Presidency
Magistrate, Bombay, of an offence under s. 66(b) of the Bombay
Prohibition Act (Act XXV of 1949) and sentenced to undergo imprisonment till the rising of the court and to pay a fine of Rs. 250
or in defaulr to undergo rigorous imprisonment for one month. He
preferred an appeal to the Hi~h Court at Bombay, which was summarily dismissed. After the dismissal of that appeal, the State of
Bombay made a revision application to the High Court praying for
enhancement of the sentence. Notice was issued to the appellant
under s. 439(2) of the Code of Criminal Procedure to show cause
against enhancement.