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PETITIONER: KARBHARI BHIMAJI ROHAMARE

       Vs.

RESPONDENT: SHANKER RAO GENUJI KOLHE & ORS.

DATE OF JUDGMENT18/11/1974

BENCH: ALAGIRISWAMI, A. BENCH: ALAGIRISWAMI, A. SARKARIA, RANJIT SINGH

CITATION:  1975 AIR  575            1975 SCR  (2) 753  1975 SCC  (1) 252  CITATOR INFO :  F          1975 SC1067  (2)  R          1992 SC1959  (20)

ACT: Holding office of profit under the State Govt. membership of Wage  board-Whether office of  profit-Constitution  Articles 102 and 191.

HEADNOTE: The  first respondent was nominated as a Member of the  Wage Board  constituted  under the provisions of the  Wage  Board Act.   During the time the first respondent was a Member  of the  Wage  Board.  he filed his  nomination  for  Contesting election to the Maharashtra State Legislative Assembly.  The appellant contended that the membership of the Wage Board is an  office  of profit under the State Government  and  that, therefore.  the  respondent  No,  1  was  disqualified   for election.  Respondent No. 1 was entitled to draw  travelling allowance  and  daily allowance at the  rate  prescribed  in Scale  1  of the Bombay Civil Service Rules.   He  was  also entitled  to receive Rs. 25/- per day of the meeting of  the Wage Board as honorarium. HELD  :  It was not disputed that the  daily  allowance  and travelling  allowance payable to the members would not  make the  membership of the Wage Board an office of profit.   The whole  controversy centres round the honorarium  payable  to the  members  of  the  Wage  Board.   The  matter  must   be considered  as  a matter of substance rather than  of  form. The daily allowance was Rs. 18 whether the meeting was  held at  Bombay,  Poona.   Aurangabad or  Kopargaon.   The  first respondent’s  evidence was that when he went to  Bombay  for attending the meetings of the Wage Board he had to spend Rs. 20/- as Taxi fare, Rs. 25/- for breakfast lunch and dinner,’ and Rs. 40/- for lodging.  He seems to have been staying  in a modest hotel.  After an elaborate discussion of the entire evidence the learned High Court Judge accepted the  evidence of  the first respondent that he had to spend Rs.  20/-  for taxi  fare and that hotel charges for a common  room  varied from  Rs.  15/- to Rs. 16/- and for a single room  from  Rs. 28/-  to Rs. 30/- and that the aggregate of  the  honorarium and the daily allowance payable to the first respondent  was hardly sufficient to meet the personal expenditure  incurred

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for  the  purpose  of attending the meeting  in  Bombay  and simply  because  he was paid both the honorarium  and  daily allowance  it  could  not be said that  he  was  making  any pecuniary gain thereby.  The question hag to be looked at in a  realistic  way.  The payments made  to  first  respondent cannot  be  a source of profit unless he  stayed  with  some friends or relatives or stayed in a Dharamshala.  The  first respondent,  therefore,  did not hold an office  of  profit. The  case  of Mahadev v.  Shantibhai  distinguished.  [756D; 758EF; 759A-G]

JUDGMENT: CIVIL  APPELLATE,  JURISDICTION : Civil Appeal No.  2365  of 1972. Appeal  from the Judgment & Order dated the 22nd  September, 1972 of the Bombay High Court in E. P. No. 1 of 1972. V.   M. Tarkunde, D. V. Patel, K. Rai Choudhry, K. S. Bhadti and S.    L. Setia, for the appellant. V. S. Desai, S. B. Wad and M. S. Ganesh, for respondent  No. 1. The Judgment of the Court was delivered by ALAGIRISWAMI,  J. In the election to the  Maharashtra  State Legislative   Assembly  held  on  March  7,  1972  the   1st respondent  was declared elected from  Shirdi  Constituency. The  appellant,  a  voter from that  constituency  filed  an election petition questioning election of the 1st respondent on two grounds : one was that the successful candidate 754 had committed several corrupt practices, the other that  the election,  was  liable  to  be  set  aside  because  he  was disqualified  for election as he was. holding an  office  of profit  under the State Government as a member of  the  Wage Board  for the Sugar Industry constituted by the  Government of  Maharashtra under section 86-B of the Bombay  Industrial Relations, Act, 1946.  The only question argued before  this Court was the 2nd one. February  8, 1972 was the last date for  filing  nominations and  February  11,  1972 the last  date  for  withdrawal  of candidature.  The 1st respondent resigned as a member of the Wage   Board  on  February  20,  1972  and  the  letter   of resignation  was  received by the concerned  authorities  on February 22, 1972. The Wage Board to which the 1st respondent was nominated  as a  member  on  13th April  1971  was,constituted  under  the provisions  of  Chapter 12A of that Act  introduced  by  the Amending  Act No. 43 of 1948.  Under section 86C  the  State Government  may  make  reference  to  the  Wage  Boards  for decision  of  any industrial matter of  industrial  dispute. Under section 86G the order or decision of the Wage Board is made  appealable  to the Industrial Court.  The  parties  on whom the order or decision of the Wage Board is binding  are enumerated in section 86H.  Section 861 provides for  review of  the order or decision, by the Wage Board.   Section  86J confers certain powers of superintendence on the  Industrial Court over all Wage Boards. The  first question to be decided is whether the  membership of  the Wage Board is an office under the State  Government. In Maulana Abdul Shakur v. Rikhabchand & Anr. (1958 SCR  387 @ 394) this Court held :               "The  power  of the Government  to  appoint  a               person  to an office of profit or to  continue               him  in that office or revoke his  appointment               at  their discretion and payment from  out  of

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             Government  revenue are important  factors  in               determining whether that person is holding  an               office of profit under the Government." Leaving  aside for the present the question of  payment,  as the  1st  respondent  was appointed by  the  Government  the Government  could  either  continue him in  that  office  or revoke  his appointment at their discretion.  In Ramappa  v. Sangappa (1959 SCR 1167) this Court pointed out that :               "An office has to be held under someone for it               is  impossible to conceive of an  office  held               under  no one.  The appointment being  by  the               Government,  the  office to which it  is  made               must  be  held under it, for there is  no  one               else under whom it can be held." There  is  no  doubt that in this case  the  office  of  the membership  of the Wage Board should be deemed to have  been held by the 1st respondent 755 under the Government of Maharashtra.  In Gurugobinda Basu V. Sarkari Prasad Ghosal & Ors. [1964](4) SCR 3111 it was  held that               "For  holding  an office of profit  under  the               Government a person need not be in the service               of  the Government and there need not  be  any               relationship  of  master and  servant  between               them." In that view even the Comptroller and Auditor General, being appointed  by  the President and his  administrative  powers being  such  as  may  be prescribed by  rules  made  by  the President subject to the provisions of the Constitution  and of any law made by Parliament, was held to be a holder of an office  of  profit  under  the  Government  on  India.    In Shivamurthy Swami v. Agadi Sanganna Andanappa [1971 (3)  SCC 870] the indicia of an office held under the Government were put this:                "...  the office in question must  have  been               held under a Government and to that some  pay,               salary,    emoluments    or    allowance    is               attached.   .  .  .  This  Court  in   several               decisions had laid down the tests for  finding               out whether an office in question is an office               under a Government and whether it is an office               of profit.  Those tests are : (1) Whether  the               Government makes the appointment; (2)  Whether               the  Government  has the right  to  remove  or               dismiss the holder; (3) Whether the Government               pays  the  remuneration;  (4)  What  are   the               functions of the holder?  Does he perform them               for the Government and (5) Does the Government               exercise  any control over the performance  of               those functions ?" Again, leaving aside for the present the question of payment of  remuneration, the office of the membership of  the  Wage Board  satisfies  all the tests here laid down.   The  power exercised  by  the Wage Board is essentially a part  of  the judicial power of the State and the Wage Board is  appointed to  exercise that power.  There can, therefore, be no  doubt that the 1st respondent did hold an office under the Govern- ment.   This proposition was not seriously disputed  by  the 1st  respondent.  The only serious dispute is  whether  that office was an office of profit. The  first Wage Board for Sugar Industry was constituted  in the  year  1956  by a  Government  notification  Development Department  No.  BIR-2355, dated March 20, 1956.   The  Wage Board  consisted of three members.  By a notification  dated

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May  16, 1967, a new Wage Board for the Sugar  Industry  was constituted  consisting of five members.  By a  notification dated  April 13, 1971 the 1st respondent was nominated as  a member  of the Wage Board to represent the employers on  the Wage  Board  in place of one E. V. Wikhe  who  resigned  his membership.   That notification itself does not mention  the terms of appointment.  To the notification constituting  the Wage  Board in the year 1956 a resolution was also  appended directing  that the non-official members of the  Wage  Board should  be paid honorarium at the rate of Rs. 25/per day  of the  meeting of the Wage Board and that they should also  be allowed to draw travelling allowance and daily allowance  at the rate prescribed in Scale 1 in Rule 1 (1) (b) in  section 1  of  Appendix XLII-A of the Bombay  Civil  Services  Rules (Vol.  II). Such a resolution 756 regarding  honorarium and allowances payable to the  members was  not part of the 1967 notification creating  a.new  Wage Board, but apparently the members are paid only on the basis of the 1956 resolution.  There is no dispute that the  daily allowance  and travelling allowance payable to  the  members would not make the membership of the Wage Board an office of profit.-  That  comes  within the definition  of  the  words "compensatory allowances" found in item 11, Schedule I  read with section 2 of the Bombay Legislature Members (Removal of Disqualifications)  Act, 1956.  Item 11 in Schedule I  reads as follows               "11.  The office of the Chairman or member  of               any committee or body appointed by the Central               or State Government;               Provided  that the Chairman or any  member  of               such  committee or body does not  receive  any               remuneration   other  than  the   compensatory               allowance.   Explanation : For the purpose  of               this entry, compensatory allowance shall  mean               the travelling allowance, the daily  allowance               or  such other allowance which is paid to  the               holder  of  the  office  for  the  purpose  of               meeting the personal expenditure in  attending               the  meeting  of the committee or body  or  in               performing  any other functions as the  holder               of the said office." The whole controversy centres around the honorarium  payable to the members of the Wage Board.  It is contended on behalf of  the appellant that item 11 specifically lays  down  that the   compensatory  allowance  shall  mean  the   travelling allowance, the daily allowance or such other allowance which is  paid  to  the holder of the office for  the  purpose  of meeting the personal expenditure in attending the meeting of the committee or body or in performing any other function as the  holder of the said office, and honorarium which is  not mentioned there cannot be brought within the meaning of  the words "such other allowance" found in that item as it is not an  allowance.  Reference is made to the dictionary  meaning of the word ’honorarium and it is said that while the  daily allowance  is  expected to meet the expenses of  the  member concerned  while  attending the meeting of  the  Board,  the honorarium is in the form of a fee for performing his duties on  those  days.  The Shorter Oxford  Dictionary  gives  the meaning  of the word ’honorarium’ as an honorary  reward,  a fee  for  professional service rendered, while  one  of  the meanings of the word ’salary’ is, fixed payment made  perio- dically  to  a  person as  compensation  for  regular  work, remuneration for services rendered, fee, honorarium.   Thus, in  one aspect honorarium and fee are used almost as  though

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they  are interchangeable terms.  Even so, what was paid  to the  1st respondent cannot be said to be a salary.   It  was not  a fixed payment made periodically as  compensation  for regular  work.  We do not think that the dictionary  meaning is  of  much help here.  We are of opinion that  the  matter must  be considered as a matter of substance rather than  of form,   of   the  assence  of  payment   rather   than   its nomenclature.   Even  so,  it  is urged  on  behalf  of  the appellant that the payment of honorarium in this case  could not  have  been  for  any purpose  other  than  payment  for services  rendered on particular days on which the  meetings of  the  Wage Board were, held.  We are not able  to  accept this contention, 757 In  this  connection various decisions relied  upon  by  the appellant are themselves of interest.  In Ravanna Subanna v. G. S. Kaggeerappa (AIR 1954 SC 653) a person holding  office of Chairman of Taluk Development Committee was entitled to a fee  of  Rs. 6/- for each sitting he attended.   This  Court held  that it could reasonably be inferred that the  fee  of Rs.  6/,-  was  not meant to be a payment by  way  of  remu- neration  but  it was given for the  out-of-pocket  expenses which  the Chairman had to incur for attending the  meetings of  the committee.  The point to be noted is that though  it was  termed a fee it was considered to be given for  meeting the  out-of-pocket expenses of the member.  It was  observed in that decision that               "The  word  "profit"  connotes  the  idea   of               pecuniary  gain.  If there is really  a  gain,               its  quantum or amount would not be  material;               but the amount of money receivable by a person               in connection with the office he holds may  be               material in deciding whether the office really               carried any profit." The stress here is on the pecuniary gain. The decision in Umrao Singh v. Darbara Singh & Ors. [1969(1) SCR  421]  is  a  very important  one.   In  that  case  the successful  candidate  was  the  Chairman.  of  a  Panchayat Samiti.   He  was  paid Rs.  100/a  month  as  ’consolidated allowance  for performing all official duties  and  journeys concerning   the  Panchayat  Samitis  within  the   district including  attending  of  meeting,  supervision  of   plans, projects, schemes and other works and also for the discharge of  all lawful obligations and implementation of  Government directives’.    He  was  also  granted  mileage  and   daily allowance for journeys performed for any official work  out- side  the district.  The daily allowance was payable at  the rate of Rs. 6/per day of official work performed outside the districts.   The  rules, however, made provision as  to  the circumstances  under  which he was entitled  to  full  daily allowance  or half daily allowance as the case may be.  This Court referred to the consolidated allowance and pointed out that  it was not salary, remuneration or honorarium but  was clearly  an allowance paid for the purpose of ensuring  that the  Chairman  of a Panchayat Samiti did not have  to  spend money out of his own pocket for the discharge of his duties. This Court further held that the burden lay on the appellant to  give evidence on the basis of which a  definite  finding could have been arrived at that the amount of Rs. 100/-  per month  was excessive and was not required to compensate  the Chairman  for  the  expenses to be incurred by  him  in  the discharge  of his official duties.  Even with regard to  the daily  allowance and travelling allowance payable  when  the Chairman  had  to perform his duties outside  the  district, this  Court pointed out there was no evidence from which  an

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inference  may  be  drawn  that the  amount  received  by  a Chairman for travelling allowance or daily allowance was  in excess  of the amount of expenditure which he would have  to incur for the purpose of performing the journeys in order to discharge  his  official duties.  It was urged  before  this Court  that  the payment of travelling allowance  and  daily allowance was in addition to the payment of the consolidated monthly allowance and the Payment of two sets of  allowances must  necessarily  result  in profit to  the  payee.   After pointing out the different purposes for which these two sets of allowances were meant this Court finally 758 held  that  the appellant had failed to establish  that  the allowances  payable  resulted in any pecuniary gain  to  the Chairman.  The whole purport of the decision is thus whether what  was  received  by  the member was  in  excess  of  the expenditure which he would have to incur for the purpose  of performing  the journeys in order to discharge his  official duties, the burden being on those who allege it. In Shivamurthy Swami v. Agadi Sanganna Andanappa (supra) the only relevant instance was that of his membership of Khadi & Village Industries Board.  In that capacity he was  entitled to a sitting fee of Rs. 16/- per day on the days he attended the meetings of the Board or any of its committees.  But  he could  not  draw  the  sitting fee  as  well  as  the  daily allowance and had to draw only one of the two.  The  sitting fee  was held by this Court to be a compensatory  allowance. The  decision  is not, therefore, of such relevance  to  the facts of this case. Reference  has already been made to the various payments  to which the 1st respondent was entitled to as a member of  the Wage  Board, It is not necessary to refer to the  number  of meetings he attended or the places at which he attended  the meetings  because  the  question has to be  decided  not  on whether  a  particular  member  made a  profit  out  of  the payments  made  to  him but on what was the  effect  of  the payments in general.  The daily allowance is not payable for a halt upto six hours, and for halt exceeding six hours  but less  than  12  hours  only half  the  daily  allowance  was payable.   The  daily  allowance was Rs.  18/-  whether  the meeting was held at Bombay, Poona, Aurangabad or  Kopargaon. The learned Judge of the High Court has pointed out that for attending the meeting in Bombay a member coming from outside was  expected to come by the latest available train  and  to leave by the first available train and the charging of daily allowance  depended  upon the arrival and departure  of  the trains.  The 1st respondent’s evidence was that when he came to  Bombay for attending the meetings of the Wage Board,  he had to spend Rs. 20/- as taxi fare, Rs. 25/- for break-fast, lunch  and dinner and Rs. 40/ for lodging, that if he had  a single room for the stay in a hotel he used to pay Rs.  30/- per  day.  He seems to have been staying in a  modest  hotel which  charged Rs. 15/- to Rs. 16/for a common room and  Rs. 28/-  to  Rs. 30/- for a single room including  lodging  and boarding  charges.  As pointed out by the learned Judge,  it should not be forgotten that if for the purpose of his lunch a member was expected to return to his hotel from the  place where the meeting was held, he will have to incur double the taxi  fare, both before and after the lunch, and if he  does not return back to the hotel he has to arrange for the lunch at  a  place in the vicinity of the office where  the  Board meetings  are  held  and pay for  it.   After  an  elaborate discussion 759 of all the evidence, the learned Judge accepted the evidence

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of the 1st respondent that he had to spend Rs. 20/- for taxi fare, that in the hotel where the 1st respondent stayed  the charges for a common room were Rs. 15/- to Rs. 16/- and  for a  single room Rs. 28/- to Rs. 30/per day including  lodging and boarding and that if regard be had to these figures then the  aggregate  of the honorarium and  the  daily  allowance payable to the 1st respondent was hardly sufficient to  meet the  personal  expenditure  incurred  for  the  purpose   of attending  the meeting in Bombay, and simply because he  was paid  both  honorarium and daily allowance it could  not  be said  that  he was making any pecuniary  gain  thereby.   We agree with the learned Judges conclusion.  The question  has to be looked at in a realistic way.  Merely because part  of the payment made to the 1st respondent is called  honorarium and  part of the payment daily allowance, we cannot come  to the  conclusion  that the daily allowance is  sufficient  to meet  his daily expenses and the honorarium is a  source  of profit.  A member of the Wage Board cannot expect to stay in Taj  Hotel and have a few drinks and claim  the  expenditure incurred,  which may come perhaps to Rs. 150/to Rs. 200/-  a day, for his personal expenses.  In such a case it may  well be held to give him a pecuniary gain.  On the other hand  he is  not  expected  to  live like a sanyasi  and  stay  in  a dharamshala  and depend upon the hospitality of his  friends and  relatives  or force himself upon them.  Nobody  with  a knowledge  of  the expenditure likely to be  incurred  by  a person  staying at a place away from his home could fail  to realise how correct the assessment of the learned Judge  is. We  are  satisfied  that  the  payments  made  to  the   1st respondent cannot be a source of profit unless he stays with some  friends or relatives or stays in a  dharamshala.   The appellant  has  not  satisfied the test  or  discharged  the burden pointed out by this Court in Umrao Singh’s case,  The law regarding the  question whether a person holds an office of profit should be interpreted reasonably having regard  to the  circumstances of the case and the times with which  one is concerned, as also the class of person whose case we  are dealing  with  and not divorced from reality.  We  are  thus satisfied that the 1st respondent did not hold an office  of profit. We  do  not  consider that the decision  of  this  Court  in Mahadeo  v. Shantibhai (1969 (2) SCR 422) is at all  helpful to  the  appellant.   There  the  successful  candidate  was appointed  by  the  Railway to watch  cases  coming  up  for hearing  against  Railway  in the various  courts  and  give timely  intimation  of  the  same  and  if  no  instructions regarding  any particular case were received bay him he  was expected  to appear in the court and obtain an  adjournment. He was to be paid Rs. 5/- 760 for  every such adjourment.  There was no question there  of his incurring any expenditure.  A lawyer would in the normal course  be  attending the courts and if he  discharges  some duties  while so attending and gets paid for it  clearly  he derives  a profit thereby and the decision holding  that  he was holder of an office of profit is clearly distinguishable from the facts of this case. In  the  result the. appeal is dismissed  with  costs.   The S.L.P. (Civil) No. 2605 of 1972 is also dismissed. P.H.P.                        Appeal dismissed. L319SupCII75-2,500-16-10-75-GIPF. 761