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PETITIONER: DIVISIONAL FOREST OFFICER

       Vs.

RESPONDENT: BISHWANATH TEA CO. LTD.

DATE OF JUDGMENT05/05/1981

BENCH: DESAI, D.A. BENCH: DESAI, D.A. MISRA, R.B. (J)

CITATION:  1981 AIR 1368            1981 SCR  (3) 238  1981 SCC  (3) 238        1981 SCALE  (1)771  CITATOR INFO :  D          1983 SC 937  (12)  RF         1989 SC1076  (21)

ACT:      Constitution of  India, 1950,  Article  226-Contractual obligations cannot  be enforced  by the  writ jurisdiction-A company, being  a juristic  Person is not entitled to any of the freedoms  guaranteed under  Article  19-Assam  Land  and Revenue    Regulation-Settlement    Rule    37,-Scope    of- Interpretation of clause 2 Part IV of Indenture lease.

HEADNOTE:      Respondent  Tea   Company  took   on  lease  land  N.C. Tezalpatty No.  1 from the then Government. The lease was to be exploited for cultivation and raising tea garden, and was subject to conditions set out therein and generally to Assam Land and  Revenue Regulation  and the rules made thereunder. The respondent  company sought permission from the appellant to cut 7,000 cubic feet of timber from Grant N.C. Tezalpatty No. 1  for utilising  the same  for building  of  staff  and labourers’ house  as per  clause 2  of Part  IV of the lease dated 27-9-1932  and Rule  37 of  the Assam Land and Revenue Regulations. Since  the timber  was required  by the company for use  in Partabghur  and Dekorai  tea estates  which were outside  Tezalpatty  No.  1.  the  appellant  demanded  full royalty on  timber cut, felled and removed. The company paid an amount of Rs. 7069.37 Paise under protest and later filed a petition  under Article  226 of  the Constitution  in  the Assam High Court, praying for refund of the amount and for a mandamus directing the appellant for issuing permits without insisting on  payment of  royalty whenever  timber was to be cut from the leased area for the purposes connected with the exploitation of the grant.      The preliminary  objection raised by the appellant that since the  right claimed  by the  respondent flowed from the contract  of  lease  such  contractual  right  can  only  be enforced in  civil court  and therefore  cannot be gone into under Article  226 was  rejected by the Assam High Court. On merits, the  High Court  further held  that as  the grant of N.C. Tezalpatty  No. 1  was in favour of the respondent, the company was  entitled to  cut, fell  and remove  timber from that grant  area for its use covered either by the same area

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or in  other tea  gardens which  are outside  the grant. The High Court  made the rule nisi absolute and hence the appeal by special leave.      Allowing the appeal, the Court ^      HELD:  1.  The  Writ  Petition  on  the  allegation  of infringement of  fundamental right under Article 19(1)(g) of the Constitution,  at the  instance  of  respondent  company alone was  not maintainable  for the  reasons  that:  (a)  a juristic person such as a corporation is not entitled to any of the  freedoms guaranteed  by  Article  19  and  here  the respondent is  a company  incorporated under  the  Companies Act; (b) Article 19(1)(g) guaranteed the fundamental freedom to a 663 citizen and  the respondent being a company is not a citizen and (c)  the shareholders of a company alone can complain of infringement of their fundamental rights. [669 E-H, 670 A-C]      Tata Engineering  and Locomotive Co. v. State of Bihar, [1950] S.C.R.  869, State  Trading Corporation of India Ltd. v. The  Commercial Tax  Officer,  Vishakhapatnam,  [1964]  4 S.C.R. 99  and Benuott Coleman and Co. and other v. Union of India and others, [1973] 2 S.C.R. 757, followed.      2:1.It is  undoubtedly true  that the  High  Court  can entertain in  its extraordinary  jurisdiction a  petition to issue any  of the  prerogative writs  for any other purpose. But such  writ can be issued where there is executive action unsupported by law or even in respect of a Corporation where there is a denial of equality before law or equal protection of law.  The Corporation  can also  file a writ petition for enforcement of  a right  under a  statute. Here,  the relief claimed by  the respondent was referable to nothing else but the terms  of lease, namely, clause 2 Part IV. The fact that this term  is a  mere reproduction  of proviso to Rule 37 of Assam Land  and Revenue  Local Rate  Regulation but  that by itself is not sufficient to contend that what the respondent was doing  was enforcing a statutory provision. The validity of regulations  is not challenged. Therefore, the demand for royalty is supported by law. [670 C-F]      2:2.  Ordinarily,   where  a   breach  of  contract  is complained of,  a party  complaining of  such breach may sue for specific performance of the contract, if the contract is capable of  being specifically  performed, or  the party may sue for  damages. Such a suit would ordinarily be cognizable by the  Civil Court.  The High  Court in  its  extraordinary jurisdiction  would  not  ordinarily  entertain  a  petition either for specific performance or for recovering damages. A right to relief flowing from a contract has to be claimed in a civil  court where  a suit  for  specific  performance  of contract or  for damages  could be  filed. Here,  this was a suit for  refund of  a royalty  alleged to be unauthorisedly recovered and  that could  hardly be entertained in exercise of the writ jurisdiction of the High Court. [670 F-G, 671 A- G, 672 A]      Har Shankar  and Ors.  etc. v.  The Deputy  Excise  and Taxation  Commissioner   and  ors.,  [1975]  3  S.C.R.  254, applied.      Woodcrafts  Assam  v.  Chief  Conservator  of  Forests, Assam, AIR 1971 Assam p. 92, approved.      3:1. Upon  a true  construction of  clause 2 Part IV of indenture of  lease, the respondent company was not entitled to remove  timber without  payment of  royalty. The specific provision is  that the grant is for a purpose of cultivation and raising tea garden and that from the area covered by the grant, if  timber is  felled for  purpose connected with the

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grant itself,  namely, cultivation and raising tea garden in that area,  then alone  the benefit  of  removal  of  timber without payment of royalty can be availed of. [673 G-H., 674 A]      3:2. In  order to  obtain relief,  namely  to  cut  and remove timber  from lease  area for  purpose connected  with exploitation, of  the grant  the company  must show that the timber is  being felled  and cut from an area covered by the lease in 664 which clause 2 finds its place and that such timber is being removed for  a purpose  connected with  the exploitation  of grant. To  be more specific, following facts will have to be proved for  obtaining relief:  (i) the  area covered  by the grant; (ii)  felling of  the trees  from the area covered by the grant;  (iii) use  to which  the felled timber was to be put to; (iv) such use will have to be one connected with the exploitation  of   the  grant   and  (v)   meaning  of   the exploitation of  the grant,  when controverted these aspects will have  to be  proved by  relevance.  And  that  was  the situation when  return was filed by the present appellant in the High Court. [672 G-H, 673 A-D]

JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil  Appeal No. 218 of 1970.      Appeal by  special leave  from the  judgment and  order dated the  10th September,  1968 of  the Assam  and Nagaland High Court in Civil Rule No. 56 of 1967.      S.K Nandy for the Appellant.      S.N. Chowdhary for the Respondent.      The Judgment of the Court was delivered by      DESAI, J.  This appeal by special leave arises out of a writ petition  filed by  the respondent  Bishwanath Tea  Co. Ltd., in  the Assam  and Nagaland High Court questioning the action of  the appellant,  the  Divisional  Forest  Officer, Darrang Division,  of recovering  Rs. 7069.37  p. as royalty for cutting  and felling  trees from  Tezalpatty grant No. 1 held under  lease  dated  September  27,  1932,  and  for  a mandamus directing  the appellant  to issue  permits without insisting upon  payment of  royalty for  the trees  cut  and felled from the area under lease.      Respondent  Bishwanath  Tea  Co.  Ltd.  (’Company’  for short) took on lease land admeasuring 1107.26 acres from the Government. The  lease was  executed between the Company and the Secretary of the State for India. The lease in the first instance was  for a period of 15 years commencing from April 1, 1932.  The lease  was to be exploited for cultivation and raising tea  garden. The lease was subject to conditions set out  therein   and  generally  to  Assam  Land  and  Revenue Regulation and  the rules  made thereunder.  On February 15, 1966,  manager  of  the  Company  approached  the  appellant seeking permission  to cut  7000 cubic  feet of  timber from Grant  N.C.  Tezalpatty  No.  1  of  Nagshankar  Mouza,  for utilising the  same for  building of  staff  and  labourer’s houses. By  the reply  dated April  4, 1966,  the  appellant noted that the timber was to be 665 cut for  constructing houses  in Partabghur  and Dekorai Tea Estates and  that it  was necessary to ascertain whether any of the  aforementioned two  Tea estates  was situated within the grant  evidenced by  lease of  N.C. Tezalpatty No. 1. It was made  clear that  if it was not so, full royalty will be

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payable by  the company  for cutting,  felling and  removing timber. The  manager by  his letter  dated April  23,  1966, informed the  appellant that as the lessee is Bishwanath Tea Co. Ltd,  it can  cut and fell timber from any of its leased area to  be utilised for its purposes in any other division. Therefore, the  manager suggested  that the  permit must  be issued  without   insisting  on   payment  of  royalty.  The appellant by  his letter  dated May  12, 1966,  informed the manager  that   as  the  timber  was  required  for  use  in Partabghur and  Dekorai tea  estates which  were not  within N.C. Tezalpatty  Grant No.  1 of Nagshankar Mouza from which timber was  to be  felled and  cut,  full  royalty  will  be payable on  timber so  cut and  removed because it was to be utilised for  the purpose  unconnected with  the grant.  For this assertion the appellant relied upon a portion of clause (2) of  Part IV  of the lease deed dated September 27, 1932. Correspondence  further   ensued  between  the  parties  and ultimately the  respondent company  paid an  amount  of  Rs. 7069.37 p.  as and  by way of royalty under protest and then filed a  petition under  Article 226  of the Constitution in the High Court alleging that upon a true construction of the relevant clause  of the  grant as also proviso to Rule 37 of the Settlement  Rules as  the timber  was required  for  the purpose connected  with the  exploitation of  the grant, the company as  lessee was  entitled to  cut and  remove  timber without payment  of royalty  and, therefore, the recovery of royalty being  unsupported by  law, the appellant was liable to refund  the same.  The company also prayed for a mandamus directing the  present appellant  who was  respondent in the High Court  for issuing permits without insisting on payment of royalty  whenever timber  was to  be cut  from the leased area for the purposes connected with the exploitation of the grant.      The appellant  filed his  return to  the rule issued by the High  Court. A preliminary objection was raised that the right claimed  by the respondent flowed from the contract of lease and  such contractual  rights and obligations can only be enforced in civil court. It was contended that apart from the fact  that interpretation  of the  contract of  lease is generally not  undertaken by  the High  Court in exercise of its extraordinary  jurisdiction under  Article 226,  it  was further  contended   that  even  if  interpretation  of  the relevant clause  of the  lease  as  alleged  on  behalf  the respondent finds favour with 666 the court, yet facts will have to be investigated before any refund could  be ordered  or a  blanket injunction  could be granted for  all times  to come  against the  appellant from performing  his   duty,  namely,   of  granting  permit  and recovering royalty.      The High  Court  overruled  the  preliminary  objection observing that  the court  was not called upon to decide any complicated question  of fact  and the question for decision before the  Court was  whether the  company was  entitled to enforcement of  its legal right under the proviso to rule 37 of Settlement  Rules. The  Court further  observed that even though part  of the  proviso to  rule 37  of the  Settlement Rules was incorporated in the lease itself, nonetheless what the Court  had to  consider  was  the  interpretation  of  a statutory rule  and that  is the function of the Court under Article 226. On merits the High Court held that as the grant N.C. Tezalpatty  No. I  was in favour of M/s. Bishwanath Tea Co. Ltd.,  the company  was entitled  to cut and fell timber from N.C.  Tezalpatty grant  area for  its use  in other tea gardens, namely,  Partabghur and  Dekorai and  even  if  the

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latter two gardens were outside N.C. Tezalpatty Grant No. 1, yet they  being under  the ownership  and management  of the company, felling  of trees  from the  area of  one grant for utilisation at  other places  would fall  within the  second part of  the proviso  to rule  37 in  that the  felling  and removal of  timber was  for use  not  unconnected  with  the exploitation of  the grant  and, therefore,  the company was entitled  to   fell  and  remove  timber  in  the  aforesaid situation without  payment of  royalty. In  accordance  with this finding the High Court made the rule absolute, directed refund of  the  amount  paid  under  protest  and  issued  a mandamus directing  the appellant  to issue  permits to  the respondent company without payment of royalty for removal of timber from  Tezalpatty Grant No. 1 for use in tea garden of Dekorai division  for exploitation  of tea plantation. Hence this appeal by special leave.      Unquestionably, the  rights and obligations between the parties to  this appeal  are governed  by the  terms of  the lease dated  September 27, 1932. Specifically the respondent who was  a petitioner in the High Court claimed the right to relief under  Clause 2  of Part IV of the indenture of lease which reads as under:      "2.  The lessee  shall pay to the lessor as provided by           rules for  the time being in force under the Assam           Land and  Revenue Regulation  for all  timber  (if           any) on the 667           demised lands cut down, removed or utilised by the           lessee during the period of the lease.                Timber valuation  at reduced  rates estimated           at  Rs.   12472.7  (Rupees  Twelve  thousand  four           hundred and  seventy-two and annas seven only) was           credited into  the treasury  by  Challan  Nos.  43           dated the  24.2.32 The  lessee shall  be liable to           pay timber  valuation at  full rates on all timber           sold or removed for sale and on all timber removed           for use unconnected with exploitation of the grant           during the period of his lease or renewed lease." According to  the respondent, it would be entitled to remove timber cut and felled from the leased area without liability to pay  royalty for  its own  use irrespective  of the  fact whether such  timber was to be used outside the leased area, because  such   use  would   be  in   connection  with   the exploitation of the grant and there is such a reservation in the grant  evidenced by  the lease.  True it  is that if the timber is  felled and removed for purpose connected with the exploitation of  the grant,  there would  be no liability to pay the  royalty. Such  a positive  right is  claimed from a negative covenant  in the  lease. Clause 2 provides that the lessee had  paid timber valuation at the reduced rate at Rs. 12472.7 on  24-2-32 The  lessee according  to the respondent would be liable to pay timber valuation at full rates on all timber sold  or removed  for sale  on all timber removed for use unconnected  with exploitation  of the  grant during the period of the lease or renewed lease. The implication of the negative covenant  would be  that if  timber is removed from the leased  area connected  with the  exploitation of grant, there would  be no  liability to pay royalty on such timber. The  respondent   claimed  to   remove  timber  without  the liability to  pay royalty  in exercise of the right reserved under Cl. 2 thus interpreted. In para 5 of the Writ Petition filed by  the respondent  in the High Court, a reference has been made  to the  aforementioned term in the lease deed. It was further  stated that  the respondent  paid  the  royalty under protest  which it  was not liable to pay as the timber

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was urgently required for the purpose of the business of the Company in connection with the grant. These averments in the petition would show that the respondent claimed the right to remove timber  without the  obligation  to  pay  royalty  as flowing from  the grant evidenced by the lease. Anticipating a possible  contention about  the jurisdiction  of the  High Court to entertain 668 a writ  petition for  enforcement of contractual obligation, the respondent  contended that  the levy  of royalty  had no authority  of   law  and   that  this  was  an  unreasonable restriction on  the fundamental  right of  the respondent to carry on  its trade.  This camouflage of contending that the levy of  royalty was  not supported by law and that this was an unreasonable  restriction on  the  fundamental  right  to carry on  trade successfully  persuaded the  High  Court  to entertain the petition.      Shorn of  all embellishment  the relief  claimed by the respondent was referable to nothing else but the term of the lease viz.  Cl. 2  Part IV.  Maybe, that this term is a mere reproduction of  proviso to Rule 37 of Assam and and Revenue and Local  Rates Regulations,  but that  by  itself  is  not sufficient to contend that what the respondent was doing was enforcing a  statutory provision.  Proviso to  Rule 37 is an enabling provision.  The relevant  portion  of  the  proviso reads as under:           "Provided that  if any  person taking  up land for      special  cultivation  is  unwilling  to  pay  the  full      royalty valuation  of the timber as estimated, he shall      have  the   option  of   paying  a   reduced  valuation      representing only  the profit which is likely to derive      from the  use of  the timber for the purposes connected      with the  exploitation of  the grant.  If he  exercises      such option,  he shall be liable to pay royalty at full      rates on all timber sold, bartered, mortgaged, given or      otherwise, transferred  or removed  for transfer and on      all  timber   removed  for  use  unconnected  with  the      exploitation of  the grant  during the  period  of  his      lease or renewed lease." A bare  perusal of  clause 2  of Part IV of the indenture of lease extracted  hereinbefore and  the proviso  to  Rule  37 would at a glance show that the proviso enables a grantee to take benefit  of it  by fulfilling certain conditions namely by paying  a reduced  valuation representing only the profit which it  is likely  to derive  from the  use of  timber for purposes connected with the exploitation of the grant. It is thus an  enabling provision and the grantor of the lease may permit this option to be enjoyed by the grantee. But whether that has  been done  or not is always a question of fact. If the precondition  is satisfied,  the benefit  can be  taken. That again  is a  matter to  be worked out by the parties to the indenture  of lease.  In fact, clause 2 of the indenture of lease would show that the respon- 669 dent grantee  paid Rs.  124727/- being  timber valuation  at reduced rates.  The  respondent  having  made  the  payment, whereupon the  grantor of  the lease agreed that the grantee will have  to pay  timber valuation  at full  rates  on  all timber sold  or removed  for sale  and on all timber removed for use  unconnected with  exploitation of  the grant during the period  of his  lease or  renewed lease  but the grantee will not  have to  pay royalty for timber felled and removed for purpose  connected  with  the  grant.  It  thus  can  be demonstrably established  that the  respondent was trying to enforce through the writ petition the right to remove timber

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without the  liability to  pay royalty not under the proviso to Rule  37 which  was merely an enabling provision, but the specific term  of  lease  agreed  to  between  the  parties. Proviso to  Rule 37  may not be incorporated in an indenture of lease.  If incorporated after fulfilling pre-condition it becomes a  term of  lease. The  High Court,  in our opinion, therefore, was in error in posing a question to itself as to whether the  applicant (respondent  herein) was  entitled to the enforcement  of legal right under the proviso to Rule 37 of the Settlement Rules. The camouflage successfully worked, but once  this cloak is removed, it unmistakably, transpires that the  respondent was trying to claim benefit of clause 2 of  the   lease  having   fulfilled  its  pre-condition  and obtaining the  inclusion of  its latter part in the contract of lease.  The question,  therefore, really  is whether such contractual  obligation   can  be   enforced  by   the  writ jurisdiction? How  dangerous  it  is,  can  be  demonstrably established in this case.      But we would first address ourselves to the question of law. Art. 226 confers extraordinary jurisdiction on the High Court to issue high prerogative writs for enforcement of the fundamental rights  or for  any other  purpose. Undoubtedly, the respondent  contended that  its fundamental  right under Art. 19(1) (g) to carry on trade has been violated. The High Court overlooked  the well-settled  legal  position  that  a juristic person such as a Corporation is not entitled to any of the  freedoms guaranteed  by Art.  19. The respondent was the sole  petitioner in  the High  Court. It  is  a  company incorporated under  the Companies Act. The fundamental right claimed under  Art. 19 (1) (g) is to practise any profession or  carry   on  any   occupation,  trade  or  business.  The respondent (company)  contended that it had a right to carry on its  trade or  business of  cultivating and raising a tea garden and  as part  of it to cut timber and remove the same from the leased area without the payment of royalty and that insistence upon  payment of royalty unsupported by law is an unreasonable  restriction   denying  the  fundamental  right guaranteed to the respondent. Art. 670 19 (1)  (g) guarantees the fundamental freedom to a citizen. The respondent  not being  a citizen  was  not  entitled  to complain of  breach or  violation of fundamental right under Art. 19  (1) (g).  [See State  Trading Corporation  of India Ltd. v. The Commercial Tax Officer, Vishakhapatnam  and Tata Engineering and Locomotive Co. v. State of Bihar .] However, the shareholders  of a  company can complain of infringement of their  fundamental rights  [See Bennett Coleman & Co. and others v.  Union of  India and others]. Such is not the case pleaded. Therefore  the writ  petition on  the allegation of infringement of  fundamental right  under Art. 19 (1) (g) at the  instance   of  respondent   company   alone   was   not maintainable.      It is undoubtedly true that High Court can entertain in its extraordinary  jurisdiction a  petition to  issue any of the prerogative  writs for  any other purpose. But such writ can be issued where there is executive action unsupported by law or  even in  respect of  a Corporation  where there is a denial of  equality before  law or  equal protection of law. The  Corporation   can  also   file  a   writ  petition  for enforcement of  a right  under a  statute.  As  pointed  out earlier, the  respondent  (Company)  was  merely  trying  to enforce a contractual obligation. To clear the ground let it be stated  that obligation to pay royalty for timber cut and felled  and   removed  is   prescribed   by   the   relevant regulations. The  validity of regulations is not challenged.

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Therefore, the  demand for  royalty is  unsupported by  law. What the respondent claims is an exception that in view of a certain term  in the  indenture of  lease, to wit, Clause 2, the appellant  is not entitled to demand and collect royalty from the  respondent. This  is nothing  but enforcement of a term of  a contract  of lease.  Hence, the  question whether such contractual  obligation can  be enforced  by  the  High Court in its writ jurisdiction.      Ordinarily, where  a breach  of contract  is complained of, a  party complaining of such breach may sue for specific performance of the contract, if contract is capable of being specifically performed,  or the  party may  sue for damages. Such a  suit would  ordinarily be  cognizable by  the  Civil Court. The  High Court  in  its  extraordinary  jurisdiction would  not   entertain  a   petition  either   for  specific performance of  contract or  for recovering damages. A right to relief  flowing from  a contract  has to  be claimed in a civil  court  where  a  suit  for  specific  performance  of contract or for damages could be 671 filed. This  is so well settled that no authority is needed. However, we  may refer  to a  recent decision bearing on the subject. In  Har Shankar  and Ors.  etc. etc.  v. The Deputy Excise and  Taxation Commissioner  and Ors., the petitioners offered  their  bids  in  the  auctions  held  for  granting licences  for   the  sale   of  liquor.   Subsequently,  the petitioners moved to invalidate the auctions challenging the power of the Financial Commissioner to grant liquor licence. Rejecting this  contention, Chandrachud  J., as  he than was speaking for  the Constitution Bench at page 263 observed as under:           "Those who contract with open eyes must accept the      burdens of  the contract  along with  its benefits. The      powers of  the Financial  Commissioner to  grant liquor      licences by auction and to collect licence fees through      the medium  of auctions  cannot by  writ  petitions  be      questioned by  those who,  had their venture succeeded,      would have  relied upon  those very  powers to  found a      legal claim.  Reciprocal rights and obligations arising      out of  contract do not depend for their enforceability      upon whether  a contracting  party finds  it prudent to      abide by  the terms  of the contract. By such a test no      contract could ever have a binding force." Again at page 265 there is a pertinent observation which may be extracted.                Analysing the  situation  here,  a  concluded           contract must  be held to have come into existence           between the parties. The appellants have displayed           ingenuity  in   their  search   for   invalidating           circumstances  but  a  writ  petition  is  not  an           appropriate  remedy   for  impeaching  contractual           obligations." This apart,  it also  appears that  in a later decision, the Assam High  Court itself  took an  exactly opposite  view in almost identical circumstances. In Woodcrafts Assam v. Chief Conservator of  Forests, Assam,  a writ  petition was  filed challenging  the  revision  of  rates  of  royalty  for  two different  periods.   Rejecting   this   petition   as   not maintainable, a  Division Bench  of the High Court held that the complaint  of the  petitioner is that there is violation of his  rights under the contract and that such violation of contractual  obligation   cannot  be   remedied  by  a  writ petition. That  exactly is  the position  in the case before us. Therefore,  the High  Court was in error in entertaining the writ  petition and  it should have been dismissed at the

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threshold. 672      In substance,  this was  a suit for refund of a royalty alleged to be unauthorisedly recovered and that could hardly be entertained  in exercise  of the writ jurisdiction of the High Court.      As the  High Court  has also  disposed of  the case  on merits after overruling the preliminary objection, it is but meet that  we may examine the case on merits and that itself would demonstrably  show the dangerous course adopted by the High Court in examining rights and obligations claimed under the contract without proper or adequate material or evidence to reach  a conclusion,  more so  when the  petition  raised disputed questions of facts which needed investigation.      Respondent  No.  1  had  entered  into  a  lease  dated September 27,  1932 with  the Secretary  of State for India. Part II  of the  lease describes  the  land  leased  to  the respondent. The description is as under;           N. C.  Tengalbasti Village  in Sootea Mauza in the      Tezpur Sadar  Sub-Division of  Darrang District.  Block      No. 1 Field No. 2-1804 B. 4 K-12L, Block No.2 Field No.      3-1544 B. 2 K-13L.           Total-1107.26 Acres on 3349 B. 2K-5L This land was taken on lease for cultivation and raising tea garden. Under the relevant Clause 2 above, the lessee was to pay timber  valuation on  full rate  for all  timber sold or removed  for   sale  and  on  all  timber  removed  for  use unconnected with exploitation of the grant during the period of lease  or renewed  lease. From  this negative covenant in the indenture  of lease,  the  respondent  says  that  where timber is  cut and  felled and  removed for a purpose or use connected with  the exploitation  of grant during the period of lease  or renewed  lease, royalty  shall not  be payable. Assuming the  respondent is  right in  its  construction  of Clause 2  of the  indenture of  lease, in  order  to  obtain relief, namely,  to cut  and remove  timber from  the leased area for  purpose connected  with the  exploitation  of  the grant, it  must show that the timber is being felled and cut from an  area covered  by the  lease in which Clause 2 finds its place  and that  such timber  is  being  removed  for  a purpose connected  with the exploitation of the grant. To be more specific,  following facts  will  have  to  proved  for obtaining relief:           (i)  The area covered by the grant. 673           (ii) Felling of the trees from the area covered by                the grant.           (iii)Use to  which the felled timber was to be put                to.           (iv) Such  use will  have to be one connected with                the exploitation of the grant.           (v)  What is  meant by  the  exploitation  of  the                grant ? Could these facts be assumed without evidence ? Was the High Court justified  in observing  that it  was called  upon  to decide complicated  questions of  facts ?  Some averments in the petition  were disputed.  The appellant  contended  that Clause 2  of the indenture of lease only means that if there is some use of timber which is being felled and removed from the area covered by the grant for the purpose connected with the exploitation  of that very grant, then and only then the relief can  be claimed  under Clause 2. The High Court found as a  fact that  the timber was sought to be removed for the purpose of constructing quarters for the workmen employed in Partabghur Garden  situated in Dekorai Division. Admittedly,

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this  Partabghur   Garden  is  not  situated  in  Tezalpatty Village. At any rate, Partabghur Garden where the houses for the workmen  were to be constructed was situated outside the area covered  by the  grant, as  also  outside  the  Revenue Division in which the leased area is located. The High Court got over  this difficulty  by observing that the grant being in favour  of an incorporated company, it can cut and remove timber from leased area for use at any place which is owned, managed or  controlled by  the company  and it is immaterial whether one  is directly connected with the other or not. If the timber  is being felled from the area of one grant to be used at  some other  place where  the Company is carrying on its operation,  the benefit of the removal of timber without payment  of  royalty  would  be  available  to  the  Company anywhere in  the world.  To  stretch  this  logic  a  little further, it  would mean  that if the respondent (Company) is to set up a tea garden outside India, it can as well cut and remove timber  from N.C. Tezalpatty, Grant No. 1 in Assam to the place  outside  India  without  the  obligation  to  pay royalty. The  fallacy underlying  the approach  of the  High Court  becomes  self-evident.  It  is  immaterial  that  the grantee was  the Company. The specific provision is that the grant is for a purpose of cultivation and raising tea garden and that  from the  area covered  by the grant, if timber is felled for  purpose connected with the grant itself, namely, cultivation and  raising tea  garden in that area then alone benefit of  removal of timber without payment of royalty can be 674 availed of.  It is  admitted that  Partabghur Tea  Garden is outside the  area covered  by  the  grant,  in  fact  in  an altogether different  division. In  such a  situation upon a true construction  of Clause  2, Part  IV  of  indenture  of lease, the  respondent Company  was not  entitled to  remove timber  without  payment  of  royalty.  Therefore,  even  on merits, the High Court was in error in granting relief.      Accordingly, this appeal is allowed and the judgment of the High  Court is  quashed  and  set  aside  and  the  writ petition filed  by the  respondent  in  the  High  Court  is dismissed with costs throughout. S.R.                                         Appeal allowed. 675