1951 (5) TMI 21 - HC - Indian Laws

Court upholds Evacuee Property Act, denies relief to petitioner.

Asiatic Engineering Co. Versus Achhru Ram And Ors.

The court dismissed both applications, ruling in favor of the respondents. It held that the Custodian had jurisdiction to declare the company's property ... - Issues Involved:1. Jurisdiction of the Custodian under the Evacuee Property Act.2. Validity of the Evacuee Property Act under the Constitution.3. Allegations of misrepresentation and suppression of facts by the petitioner.4. Applicability of the Evacuee Property Act to incorporated companies.5. Discretionary nature of writs under Article 226 of the Constitution.Issue-wise Detailed Analysis:1. Jurisdiction of the Custodian under the Evacuee Property Act:The petitioner argued that the Custodian had no jurisdiction to declare the company's property as evacuee property merely because some shareholders were evacuees. The respondents contended that the Muslim shareholders and directors were evacuees and that the company was transferring assets to Pakistan. The court noted that the definition of evacuee property under the Act was broad and included any right or interest in any capacity. The court held that the Custodian's actions were not without jurisdiction, as the Act allowed for the inclusion of a company's assets if its shareholders were evacuees.2. Validity of the Evacuee Property Act under the Constitution:The petitioner claimed that the Act was inconsistent with Articles 14 and 19(f) of the Constitution. The court held that the Act did not violate Article 14 as it was based on reasonable classification due to the unique historical circumstances following the partition of India. The court also held that the Act did not violate Article 19(f) as the restrictions imposed were reasonable and in the public interest. The court emphasized that the legislature's judgment in enacting the law should be given due weight.3. Allegations of Misrepresentation and Suppression of Facts by the Petitioner:The court found that the petitioner had suppressed material facts and made misleading statements. Specifically, the petitioner failed to disclose the appointment of a Manager-cum-Accountant, the agreement to furnish security, the existence of a branch office in Karachi, and the numerical majority of Muslim shareholders. The court held that these suppressions and misrepresentations were material and influenced the interim order granted by the court. The court emphasized the need for petitioners to come with clean hands and be completely honest in ex parte applications.4. Applicability of the Evacuee Property Act to Incorporated Companies:The petitioner argued that an incorporated company could not be declared an evacuee under the Act. The court held that the definition of evacuee property was broad enough to include the assets of a company if its shareholders were evacuees. The court noted that the Act's language allowed for the inclusion of any right or interest in any capacity, which could cover the interest of shareholders in a company's assets. The court emphasized that the Act's provisions must be interpreted in light of its special context and purpose.5. Discretionary Nature of Writs under Article 226 of the Constitution:The court reiterated that the issuance of writs under Article 226 was discretionary and not a matter of right. The court highlighted that writs such as mandamus, certiorari, and prohibition were granted based on judicial principles and the specific circumstances of each case. The court held that the petitioner had disentitled itself to relief due to its conduct in suppressing material facts and making misleading statements. The court emphasized the importance of maintaining an absolute standard of truthfulness in ex parte applications.Conclusion:The court dismissed both applications, emphasizing that the petitioner had not come with clean hands and had suppressed material facts. The court held that the Custodian's actions were not without jurisdiction and that the Evacuee Property Act was consistent with the Constitution. The court also highlighted the discretionary nature of writs under Article 226 and the need for petitioners to be completely honest in their applications.