18 September 2019
Supreme Court
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JANARDAN DAGDU KHOMANE Vs EKNATH BHIKU YADAV .

Bench: HON'BLE MR. JUSTICE NAVIN SINHA, HON'BLE MS. JUSTICE INDIRA BANERJEE
Judgment by: HON'BLE MR. JUSTICE NAVIN SINHA
Case number: C.A. No.-002607-002607 / 2013
Diary number: 17800 / 2006
Advocates: LAWYER S KNIT & CO Vs RAVINDRA KESHAVRAO ADSURE


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 REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.2607 OF 2013

Janardan Dagdu Khomane and Another     ...  Appellants

versus  

Eknath Bhiku Yadav & Ors.      ...  Respondents

J U D G M E N T

Indira Banerjee, J.

1. This appeal is against a final judgment and order

dated 6th  February, 2006, whereby a Division Bench of

Bombay High Court allowed Writ Petition No.1442 of 1987

filed by the Respondent Nos.1,2 and 3, and directed the

concerned authorities to hold proceedings under Section

32(G) of the Bombay Tenancy and Agricultural Lands Act,

1948 [hereinafter referred to as “the 1948 Act” to fix

the purchase price of 6 acres and  19 gunthas of lands

at Pimpli Village in the Baramati Taluk in Pune

district, hereinafter referred to as the “said land”.

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2. The appellants are the trustees of Shree Maruti Deo

Trust Pimpli Limtek, registered as a public trust under

the Bombay Public Trusts Act, 1950, hereinafter referred

to as the “Public Trusts Act”.   By amendment in 2012,

the Public Trusts Act was renamed as “The Maharashtra

Public Trusts Act, 1950”.   It is the case of the

appellants that, since time immemorial, the said land

has belonged to the Maruti Dev Temple.  The said land is

classified in the revenue records as Class III Devasthan

Inam land belonging to the deity Maruti Dev.  The suit

property, according to the appellants, belongs to an

institution of public religious worship.

3. There cannot be any dispute that the suit land

belonged to the Devasthan. According to the appellants,

initially in 1922, one Sitram Narayan Deshpande was put

in possession of the suit land in view of the service

rendered by him to the temple.  Later, the land was let

out to the forefathers of respondent nos. 1 to 4.   

4. The respondent nos. 1 to 4, claim to be the tenants

of the respondent nos. 5 and 6.  The respondent nos. 1

to 4 claim to have been in possession of the said land

on 1.4.1957 i.e. the “Tillers Day” under the 1948 Act,

now known as the Maharashtra Tenancy and Agricultural

Lands Act.     The proforma respondents  in this appeal,

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being the trustees of the Trust, were deleted from the

array of parties by an order of this Court dated

13.2.2013.

5. The 1948 Act was amended by Bombay Act No. 15 of

1957, Bombay Act No. 38 of 1957 and Bombay Act No. 63 of

1958.  The relevant amended sections provide:

“32. Tenants deemed to have purchased land  on tillers’ day

(1)  On the first day of April 1957 (hereinafter referred to as "the tillers day") every tenant shall, [subject to the other provisions of this section and the provisions of] the next succeeding sections, be deemed to have purchased from his landlord, free of all encumbrances subsisting thereon on the said day, the land held by him as tenant, if:­ (a) such tenant is a permanent tenant thereof and  cultivates land personally;

(b) such tenant is not a permanent tenant but   cultivates land leased personally; and

(i) the landlord has not given notice of   termination of his  tenancy under section 31; or

(ii) notice has been given under section 31, but  the landlord  has not applied to the Mamlatdar on  or before the 31st day  of March 1957 under   section 29 for obtaining possession of  the land;   or

(iii) the landlord has not terminated his tenancy  on any of the  grounds specified in section  14, or has so terminated the tenancy but  has not applied  to the Mamlatdar on or before the 31st day of   March, 1957 under section 29 for obtaining   possession of the lands:

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32G. Tribunal to issue notices and determine price of land to be paid by tenants.  (1) As soon as may be after the tillers’ day the Tribunal shall publish or cause to be published a public notice in the prescribed form in each village within its jurisdiction calling upon:­

(a) all tenants who under section 32 are deemed to  have purchased the lands,

(b) all landlords of such lands, and

(c) all other possession interested therein,

to appear it on the date specified in the notice. The tribunal shall  issue a notice individually to each such tenant, landlord and also, as far as practicable, other persons calling upon each other to appear  before it on the date specified in the public notice.

(2) The Tribunal shall record in the prescribed manner the statement  of the tenant whether he is or is not willing to purchase the land  held by him as tenant

(3) Where any tenant fails to appear or makes a statement that he is  not willing to purchase the land, the Tribunal shall by an order in writing declare that such tenant is not willing to purchase the land and that the purchase is ineffective:

Provided that, if such order is passed in default of the appearance of  any party, the Tribunal shall communicate such order to the parties and any party on whose default the order was passed

may within 60  days from the date on which the order was communicated to him  apply for the review of the same.

(4) If a tenant is willing to purchase, the Tribunal shall, after giving an opportunity to the tenant and the landlord and all other persons interested in such land to be heard and after holding an inquiry,  determine the purchase price of such land in accordance with the provisions of section 32H and of sub­section (3) of section 63A:

Provided that, where the purchase price in accordance with the  provisions of section 32H is mutually agreed upon by the landlord and the tenant, the Tribunal after satisfying itself in such manner as may be prescribed that the tenants consent to the

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agreement is voluntary may make an order determining the purchase price and providing for its payment in accordance with such agreement.

(5) In the case of a tenant who is deemed to have purchased the land on the postponed date the Tribunal shall, as soon as may be, after such date determine the price of the land”.

6. It is the case of the appellants, that Section 88B,

inserted by amendment in the 1948 Act by Bombay Act

No.38 of 1957, exempts land which is the property of a

trust for,  inter alia,    educational purposes or an

institution for public religious worship, from certain

provisions of the 1948 Act including Section 32 and sub­

Sections 32A to 32 R of the said Act, provided that such

trust is or is deemed to be registered under the  Public

Trusts Act,   and the entire income of such lands is

appropriated for the purposes of such Trust.

7. The appellants contend that Section 32 has no

application to land held by a Public Trust.  Therefore,

a tenant on land held by a Public Trust does not become

purchaser either on “Tillers day” or on any subsequent

date. Counsel appearing on behalf of the appellants has

emphatically argued that the Maruti Dev Temple Devasthan

has, all along been a Public Trust.   

8. On 18.9.1983, the Gram Sabha decided to get the

Trust registered as a Public Trust.   Accordingly, an

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application no. 1484/83 was filed before the Deputy

Charity Commissioner by one of the trustees, for

registration of Shri Maruti Dev Trust, Pimpli, Limtek,

under Section 19 of the Public Trusts Act.  On 8.8.1984,

the Trust came to be registered under PTR No. A/1656

(Pune) after necessary enquiry.

9. Questioning the registration of the Trust, the

respondent no.1, father of the respondent nos. 2 to 4,

filed a Revisional Application No. 21 of 1985 before the

Joint Charity Commissioner, Pune, who remanded the

matter back to the Deputy Charity Commissioner, on the

ground that no personal notice had been given to the

concerned respondents.

10. On or about 9.7.1986, after registration of the

Trust, the Trustee in Charge of the Trust, filed an

application under Rule 52(1) of the Bombay Tenancy and

Agriculture Land Rules, 1956 before the Collector for

exemption of the said land under Section 88B of the 1948

Act.   It appears that the Pune Archives recorded the

land in question as Class III Devasthan Inam Land of the

Village Pimpli, belonging to the Maruti Dev Trust,

managed by Shri Narayan Deshpande, as per decision no.

196 dated 3.7.1858.  

11. The Additional Collector, after holding enquiry

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under Section 88B (2) of the 1948 Act, issued a

certificate dated 21.1.1987, certifying that the Trust

is “an institution of public religious worship

registered under the Bombay Public Trust Act”.   The

certificate further certified that the Trust was

eligible for exemption under Section 88B of the 1948 Act

in respect of the land in question. The appellants

assert that the certificate was issued after notice of

inquiry to the respondents who were given the

opportunity of cross­examining the Trustees.

12. On or about 13.3.1987, the respondent no.1   and

father of respondent nos. 2 to 4, filed   the above­

mentioned  writ petition being WP No. 1442 of 1987 in

the Bombay High Court, challenging the validity of the

exemption certificate.

13. Sometime in 1997, the respondent no.2 filed an

Inquiry Application No. 2008 of 1997 for registration of

a Trust consisting of new Trustees in the name of Shri

Maruti Dev Trust.

14. The appellants contend that the Inquiry Application

was misconceived and not maintainable since the

respondent nos. 1 to 4, who claim to be the tenants in

the suit property, could not seek registration of the

Trust, as such a claim would be contrary to and

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inconsistent with their earlier claim of tenancy.

15. The Deputy Charity Commissioner, after considering

the allegations and counter allegations of the

respective parties in the Inquiry Application No. 1484

of 1983 and 2008 of 1997, passed   an order dated

15.9.2001 holding that Maruti Dev Trust was already in

existence  and it was a Public Trust under the Public

Trusts Act.  Accordingly,  Application no. 2008 of 1997,

filed by the respondent was rejected.  The Application

No. 1484/1983 stood allowed.  

16.  Aggrieved by the order dated 15.9.2001, the

respondent no. 1, father of respondent nos. 2 to 4,

filed an Appeal No. 101/2001 before the Joint Charity

Commissioner, Pune.   The appeal was dismissed by the

Joint Charity Commissioner by an order dated 5.7.2005,

holding that the claim of the respondent to be the owner

of the Trust property was adverse to the interest of the

Trust.   The existing Trustees were directed to take

necessary steps for getting a scheme framed by the

Competent Authority for proper administration of the

Trust.

17. By the Judgment and order dated 6.2.2006 under

appeal, the Division Bench of the Bombay High Court

allowed   writ Petition, being W.P. No. 1442 of 1987

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filed by the respondent no.1, father of the respondent

Nos. 2 to 4,  challenging the validity of the Exemption

Certificate dated 21.1.1987 issued by the Collector, and

quashed the impugned  Exemption  Certificate.   The High

Court held that it was not open to the Collector to

grant a certificate of Exemption to the Trust as the

land had vested in the writ petitioners on 1.04.1957.

The High Court directed the authorities concerned   to

hold proceedings under Section 32 G of the 1948 Act to

fix the purchase price at an early date.     

18. The short question in this appeal is, whether the

High Court was justified in quashing the Exemption

Certificate issued by the Collector in terms of Section

88B of the 1948 Act in favour of the Trust,

notwithstanding the fact that the suit property belonged

to “an institution of public religious worship”.

19. The High Court has allowed the writ petition,  on

the ground that the Trust was registered for the first

time on 8.8.1984.  The High Court held that as the Trust

was not registered on 1.04.1957, i.e., Tillers’ Day the

tenants who were in possession of the said land on  that

day became deemed purchasers, and once the tenant became

a deemed purchaser, the ownership of the land vested in

him.   The holders could not be divested of their

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ownership by subsequent registration of the Trust.

20.  In allowing the writ petition, the High Court has

relied upon two earlier decisions of the Bombay High

Court,  Laxminarayan Temple vs. L.M. Chandore1  and

Chhatrapati Charitable Devasthan Trust vs. Parisa Appa

Bhoske and others2.

21. The High Court found that the 1948 Act, as

initially enacted, granted protection against eviction

to tenants of agricultural lands.   It did not provide

for any automatic purchase of the lands in occupation of

tenants. Upon insertion of Section 32 to 32 R along

with some other Sections by amendment of the 1948 Act by

Bombay Act No.XIII of 1957, subject to certain

exceptions, tenants who remained in possession on

Tillers day i.e., 1.04.1957 became owners of the land in

their possession.

22. The relevant provisions of Section 88B inserted by

amendment of the 1948 Act in the same year, that is,

1957, is set out hereinbelow for convenience:­

“88B. Exemption from certain provisions to land of local authorities, universities and trusts.­      

(1) [(1) Nothing in foregoing provisions except sections 3, 4B, 8, 9, 9A, 9B, 9C, 10, 10A, 11, 13 and 27 and the provisions of Chapters VI and VIII in so far as the provisions of the said Chapters

1  AIR 1970 Bom 23 2 1979 Mh.L.J.163

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are applicable to any of the matters referred to in the sections mentioned above shall apply,

(a) to lands held or leased by a local authority, or University established by law in the [2] [Bombay area of the State of Maharashtra]; and

(b) to lands which are the property of a trust for an educational purpose, [3] [a hospital, Panjarapole, Gaushala] or an institution for public religious worship;

Provided that,­

(i) such trust is or is deemed to be registered under the Bombay Public Trust Act, and

(ii) the entire income of such lands is appropriated for the purposes of such trust;”

23. Section 88B provides for exemption of land being

the property of a Trust, for    inter alia  public

religious worship and/or educational and/or social

purpose from the vesting provisions.   The High Court

noted that while the petitioners were tenants on Tillers

day i.e. 1.04.1957,   the Trust was registered for the

first time on 8th August, 1984.    

24. Relying on  Laxminarayan Temple  (supra)   the High

Court  held  that  in  order  for the  Trust  to  claim  an

exemption under Section 88B of the 1948 Act, the Trust

had to be registered before 1.04.1957, for if the trust

was not registered on 1.04.1957, a tenant would become a

deemed purchaser on that date and once the tenant became

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a deemed purchaser the ownership of the land which

vested in the tenant would not be divested by subsequent

registration of the Trust.

25. In Laxminarayan Temple (supra), a Division Bench of

the Bombay High Court held that the word “trust” in

Clause B of Section 88B(1) of the 1948 Act is not

confined to a trust for an educational purpose but it

covers trusts for other purposes mentioned in Clause (b)

including a trust for an institution for public

religious worship.   However, a Trust is not entitled to

the exemption till it fulfills two requirements

mentioned in the proviso, that is, (i) the trust must

either be registered, or (ii) deemed to be registered

under the Bombay Public Trusts Act.     

26. The High Court also relied upon  Chhatrapati

Charitable Devasthan Trust  (supra).   In the aforesaid

case, a Bench of coordinate strength of the same High

Court held that even where an application for

registration of a Trust had been made before 1957, but

the registration had not actually been effected before

1.04.1957, the tenant would become the deemed owner of

the land and, therefore, a certificate under Section 88B

of the 1948 Act could not be granted,   rejecting the

argument that registration relates back to the date of

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the application.

27. The High Court rejected the submission that the

decisions of Bombay High Court in  Laxminarayan Temple

(supra) and  Chhatrapati Charitable Devasthan Trust

(supra) required reconsideration and should therefore be

referred to a larger Bench.

28. The Bombay Public Trusts Act  was enacted to make

provisions for the better administration of public

religious and charitable trusts in the State of Bombay.

Before the Public Trusts Act was passed, public trusts

in the Bombay State were governed by various acts

including the Mussalman Wakf (Bombay Amendment) Act of

1935, the Parsi Trusts Registration Act, 1936, the

Religious Endowments Act, 1863 and the Charitable and

Religious Trusts Act, 1920.

29. The Public Trusts Act, as stated in its preamble,

was enacted to regulate and to make better provisions

for public trusts  within the State of Bombay.  Before

the Public Trusts Act was enacted, numerous ‘Mahants’,

‘Pujaris’, ‘Acharya’ etc. thrived and flourished on the

income of temples and/or deities.   Donations/offerings

made by innumerable devotees visiting the temples were

seldom accounted for by the ‘Mahants’, ‘Pujaris’, etc.

who exercised the rights of ownership over the temples

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and/or their properties.

30. The Public Trusts Act, which, as stated

hereinbefore, is intended to regulate the administration

of public religious and charitable trusts in the

erstwhile State of Bombay, now the States of Maharashtra

and Gujarat, creates for the first time a unified

special organization to deal with charity matters.

Trusts, long in existence, came to be regulated by the

the Public Trusts Act. The Mahants, pujaris etc. who

administer properties of the deity as trustees, were

brought within the ambit of the Public Trusts Act.

31. Section 2 (13) of the Public Trusts Act defines a

public trust as follows:­  

“2(13) “public trust” means an express or constructive trust for either a public religious or charitable purpose or both and includes a temple, a math, a wakf, church, synagogue, agiary or other place of public religious worship, a dharmada or any other religious or charitable endowment and a society formed either for a religious or charitable purpose or for both and registered under the Societies Registration Act, 1860”

32. Counsel appearing on behalf of the appellant has

very rightly argued, that in view of the definition of

‘Public Trust’ in the Public Trusts Act, which also

includes constructive trust either for a public

religious or charitable purpose, the absence of a deed

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of trust would not make any difference to the position

of the Trust as a “public trust”.

33. A constructive trust arises by operation of law,

without regard to the intention of the parties to create

a trust.   It does not require a deed signifying the

institution of trust.   Under a constructive trust, the

trust arises by operation of law as from the date of the

circumstances which give rise to it.    The function of

the  court  is  only  to  declare that  such  a  trust  has

arisen in the past.

34. Constructive trust can arise over a wide range of

situations. To quote Cardozo, J., “ a constructive trust

is a formula through which the conscience of equity

finds expression.”

35. Story on Equity Jurisprudence has explained

‘Constructive Trust” as:­  

"One of the most common cases in which a Court of equity acts upon the ground of implied trusts in invitum, is where a party has received money which he cannot conscientiously withhold from another party. It has been well remarked, that the receiving of money which consistently with conscience cannot be retained is, in equity, sufficient to raise a trust in favour of the party for whom or on whose account it was received. This is the governing principle in all such cases. And therefore, whenever any controversy arises, the true question is, not whether money has been received by a party of

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which he could not have compelled the payment, but whether he can now, with a safe conscience, ex aequo et bono, retain it. Illustrations of this doctrine are familiar in cases of money paid by accident, or mistake, or fraud. And the difference between the payment of money under a mistake of fact, and a payment under a mistake of law, in its operation upon the conscience of the party, presents the equitable qualifications of the doctrine in a striking manner. It is true that Courts of Law now entertain jurisdiction in many cases of this sort where formerly the remedy was solely in Equity; as for example, in an action of assumption for money had and received, where the money cannot conscientiously be withheld by the party; following out the rule of the Civil Law; Quod condition in debiti non datur uitra, quam locupletior factus est, qui accepit. But this does not oust the general jurisdiction of Courts of Equity over the subject­matter, which had for many ages before been in full exercise, although it renders a resort to them for relief less common, as well as less necessary, than it formerly was. Still, however, there are many cases of this sort where it is indispensable to resort to Courts of Equity for adequate relief and especially where the transactions are complicated, and a discovery from the defendant is requisite."

36. Section 90 of the Trusts Act states that if

there is a person in a fiduciary relation to another,

he cannot take advantage of that position so as to

gain something exclusively for himself, which he

otherwise would not have obtained, but for the

position which he held.

37. Section 94 of the Indian Trusts Act, 1882 has

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allowed the creation of a constructive trust when

situations went beyond the confines of the Act.

Section  94 has later been repealed by the Benami

Transactions Prohibitions Act, 1988.   Section 94 of

the Trusts Act read :­

"94. Constructive trusts in case not expressly provided for­

In any case not coming within the scope of any of the preceding sections, where there is no trust, but the person having possession of property has not the whole beneficial interest therein, he must hold the property for the benefit of the persons having such interest, or the residue thereof (as the case may be), to the extent necessary to satisfy their just demands."

38. In  Gopal L. Raheja v. Vijay B. Raheja3,  the

Bombay High Court restrained itself from exercising

its equitable jurisdiction to apply the English

doctrine of constructive trust when the legislature

had specifically deleted it from the Indian Trusts

Act.

39. In our view, the repeal of Section 94 of the Act

does not put any fetter in declaring a trust, even if

the situation falls outside the purview of the Act.

Its jurisdiction can be derived from Section 151 of

CPC and Section 88 of the Indian Trusts Act.

40. There can be no doubt that the Trust   was all

3 2007 (4) Bom CR 288

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along a public trust within the meaning of Section

2(13) of the Bombay Public Trusts Act.  The Trust has

rightly been registered under the Public Trusts Act,

after due enquiry.   However, all public trusts are

not entitled, as of right, to the exemption under

Section 88B  of the 1948 Act.   The said section only

applies to lands which are property of a trust inter

alia for educational purpose or for public religious

purpose provided such trust is deemed to be

registered or is registered under the Public Trusts

Act.

41. Learned counsel appearing on behalf of the

appellant emphatically argued that the trust being a

‘public trust’ within the meaning of the Public

Trusts Act, the Trust is deemed to have been

registered as and when the Public Trusts Act came

into force, long before Tillers Day, i.e., 1.4.1957.

The Public Trusts Act recognizes even constructive

trusts.

42. The expression “deemed to have been registered”

is neither defined in the Public Trusts Act nor

defined in the Indian Trusts Act, 1882.  Section 28

of the Public Trusts Act provides:

“28. Public trust previously registered under the enactment specified in Schedule

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(1) All public trusts registered under the provisions of any of the enactments specified in Schedule A and Schedule AA shall be deemed to have been registered under this Act from the date on which this Act may be applied to them.  The Deputy or Assistant Charity Commissioner of the region or sub­region within the limits of which a public trust had been registered under any of the said enactments shall issue notice to the trustee of such trust for the purpose of recording entries relating to such trust in the register kept under section 17 and shall after hearing the trustee and making such inquiry, as may be prescribed, record findings with the reason therefor. Such findings shall be in accordance with the entries in the registers already made under the said enactment subject to such changes as may be necessary or expedient.

(2) Any person aggrieved by any of the findings recorded under sub­section (1) may appeal to the Charity Commissioner.

(3) The provisions of this Chapter shall, so far as may be, apply to the making of entries in the register kept under section 17 and the entries so made shall be final and conclusive.”

Only those Trusts which were registered under

the enactments specified in Schedule A and Schedule

AA are to be deemed to have been registered under the

Public Trusts Act.   There is no other provision in

the Public Trusts Act with regard to deemed

registration.  

43. The legislature has, in its wisdom, very

consciously provided that all public trusts

registered under the provisions of the enactments

specified in Schedule ‘A’ & ‘AA’ to the Public Trusts

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Act shall be deemed to have been registered under the

Public Trusts Act.  If it were the intention of the

legislature that all public trusts should be deemed

to have been registered under the State Public Trusts

Act, the legislature would have made an express

provision to that effect.  It is not for the Court to

read into statute words and/or expressions which are

not there in the statute.

44. The judgment of this Court in  Mahant Ramswarup

Guru Chhote Balakdas vs. Motiram Khandu Patil and

Others4,  cited on behalf of the respondents is

clearly distinguishable since this Court considered

the expression “deemed to be registered” in Section

28 of the State Public Trusts Act in the context of a

trust situate  in Burhanpur, Madhya Pradesh, outside

the State of Maharashtra.

45. This Court, in effect and substance, said that

the re­organization of States in 1956 and 1960,

consequential to which new areas which originally

formed part of the Madhya Pradesh State became  part

of the Maharashtra State, necessitated amendments in

the Bombay Trusts Act to incorporate Schedule AA,

which, read with Section 28,  inter  alia, provided

that trusts registered under the Madhya Pradesh

4 AIR 1968 SC 422

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Trusts Act, 1951 would be deemed to have been

registered under the  Public Trusts Act.  This was to

save trusts already registered under the Madhya

Pradesh Trusts Act, 1951, in areas which later became

part of Maharashtra, from the trouble of having to

once again get itself registered under the Bombay

Act.

46. This Court found that where the trust was

administered outside the State of Maharashtra, with

bulk of its properties except a few plots of land

situate outside Maharashtra, such trusts would not be

governed by the  Public Trusts Act of the State of

Maharashtra and would not, therefore, fall within the

ambit of Section 28 of the said Act.   Thus, such

trusts, though registered under the Madhya Pradesh

Public Trusts Act, 1951, would not be deemed to have

been registered under the Bombay Act.

47. As observed above, the Trust, being a public

trust, has rightly been registered on 8.8.1984, after

due enquiry. The registration of the Trust under the

Public Trusts Act cannot be questioned. However, the

registration is prospective, w.e.f. 8.8.1984.   The

respondents became deemed purchasers on Tillers’ Day,

that is, 1.4.1957.  The right under Section 32 of the

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1948 Act accrued to the respondents on that day.  The

respondents cannot be divested of such right upon

subsequent registration of the Trust.  It may be true

that a Trust for a religious purpose has the right to

own and acquire property. However, such property may

be taken away by authority of law.  The validity of

Section 32 of the Public Trusts Act is not in

question.

48. Accordingly, the judgment and order passed by

the High Court is affirmed and the appeal is

dismissed without any order as to costs.

...................J.  (R. BANUMATHI)

...................J. (INDIRA BANERJEE)

SEPTEMBER 18, 2019 NEW DELHI