Union of India v. Narayan Chandra Chakraborty — 1981 DIGILAW 371 (CAL)

JUDGMENT R. N. Pyne, J.–This appeal is directed against the judgment and decree dated 11th January, 1980 of Mrs. Pratibha Bonnerjea, J. The Respondent, Narayan Chandra Chakraborty, filed suit No. 90 of 1974 against the appellant Union of India under the circumstances stated hereinafter. 2. Prior to 1964 the respondent along with one Giridharilal Ganatra used to carry on business in the jute and hessain market in Calcutta. On 8th November, 1964 an announcement made in a press conference in the first week of November, 1964 by one Mr. J. P. Singh, Chairman of the Central Board of Direct Taxes, New Delhi, officer of the appellant, was published in the Times of India and Statesman. Such announcement was in respect of voluntary disclosure of concealed income. It was to the effect that persons who would disclose their income voluntarily would he treated leniently by the respondent in the manner as stated in the publication. It was further published that the rewards to persons giving information about concealed income was being stepped up from 2.5% to a minimum of 7.50% of the extra income to be realised as a result of such information and in suitable cases such reward could be increased upto 10%. On the said date, that is 8th November, 1964 similar announcements were published in other newspapers, namely, Sunday Tribune, Ambala, Hindusthan Times Weekly, Hindusthan Standard and Amrita Bazar Patrika Pursuant to such announcement a joint representation in writing dated 24/26th October, 1965 was made by the respondent and the said Giridharilal to the then Commissioner of Income Tax No. 1 giving information about the concealed income by seven firms in the jute market. The names of such firms are mentioned in paragraph 3 of the plaint. They also furnished valuable particulars regarding books of accounts relating to such concealed income. According to the respondent, thereafter a list containing the names of other 52 firms guilty of concealing income was furnished to the appellant's officers and the names of such firms are mentioned in paragraph 8 of the plaint. According to the respondent, pursuant to the information as aforesaid on 31st January, 1967, thirty-seven business places were raided by the appellant's officer and the respondent along with Giridharidal actively helped in the above matter. It was further stated that as a result of such raids, the appellant discovered concealed income to the extent of Rs. According to the respondent, pursuant to the information as aforesaid on 31st January, 1967, thirty-seven business places were raided by the appellant's officer and the respondent along with Giridharidal actively helped in the above matter. It was further stated that as a result of such raids, the appellant discovered concealed income to the extent of Rs. 4 crores as was published on 5th February, 1967 in the Sunday Statesman. The respondent's case was that he acted on the basis of the promises made on behalf of the appellant and relied on the representations published in the newspapers as stated above and as a result thereof he changed his position and suffered disadvantages. The respondent also made his claim on the alternative basis that such information was furnished and help was rendered by him not intending to do so gratuitously and as a result thereof the appellant derived benefit by discovering conceded income and realised huge amount of extra taxes and therefore the appellant was bound to compensate the respondent by payment of promised rewards under S. 70 of the Contract Act. Here it may be noted that by an amendment of the plaint, S. 70 of the Contract Act was specifically pleaded by the respondent. It was stated by the respondent that he received from the appellant Rs. 100/- for conveyance charges and Rs. 12,500/- by way of interim reward on 18th November, 1969. The respondent thereafter made several demands for settlement of his claim in respect of the reward but the same was without any result. According to the respondent, by a letter dated 29th April, 1970 the appellant through its officer one Sri B. K. Naha, I.T.O., S.I.B acknowledged its liability to the respondent in writing and thereafter on 29th October, 1970 the respondent was informed by a telegram sent by the Central Board of Direct Taxes that a further reward has been sanctioned. As a sum of Rs. 12,500/- was offered to the respondent as further reward for acceptance in full and final settlement of all his calms against the appellant the respondent refused to accept the same inasmuch as according to him, his claim would be much more than what was offered to him. As a sum of Rs. 12,500/- was offered to the respondent as further reward for acceptance in full and final settlement of all his calms against the appellant the respondent refused to accept the same inasmuch as according to him, his claim would be much more than what was offered to him. By a letter dated 21st January, 1971, the respondent requested the appellant to furnish him certain information regarding assessments relating to his claims but such information was refused by a letter dated 4th March, 1971 sent by the appellant's officer, Mr. B. K. Naha. In his letter it was alleged that the reward was in the nature ex gratia. Having failed to recover his legitimate dues from the appellant the respondent made an application under Article 226 of the Constitution of India which was marked as Civil Rule No. 2619 (W) of 1971. It was stated by the respondent that an affidavit-in-opposition affirmed on the 29th June, 1972 by one Coimbator Kumaro Krishnamurthi, Commissioner of Income Tax, West Bengal No. II, was filed in the above matter and in paragraph 24 thereof the appellant admitted its liability in writing by saying that the reward was payable on determination of the extra taxes to be recovered as a result of the information furnished by the respondent and as the assessments were not complete the quantum of reward could not he ascertained at that stag. It was further stated that a supplementary affidavit in the said proceeding affirmed on 14th August, 1972 was filed by the respondent wherein it was stated that the appellant had recovered more than Rs. 8 crores by way of extra taxes and such allegation, was not denied by the appellant by filing any affidavit although a copy of the supplementary affidavit was duly received by the appellant on 16th August 1972. In view of tile stand taken by the appellant that the assessment was incomplete the respondent did not press the said Rule and withdrew the same with liberty to take out fresh proceedings. The said rule was disposed of by an order dated 27th September, 1972. In disposing the said rule, the Court directed the appellant to make ad interim payment to the respondent at an early date and to expedite the matter. Thereafter; several reminders were given by the respondent. The said rule was disposed of by an order dated 27th September, 1972. In disposing the said rule, the Court directed the appellant to make ad interim payment to the respondent at an early date and to expedite the matter. Thereafter; several reminders were given by the respondent. By letter dated 2nd June, 1973 the appellant informed the respondent that the matter could not be finalised due to various litigations instituted by the assessees and the question of final reward would be taken up after relevant assessments would become final and on realisation of extra taxes. In view of the appellant remaining silent in the matter and as no final reward, was paid to the respondent, the respondent after serving a notice under S. 80 of the Code of Civil Procedure filed the above suit claiming for a decree for Rs. 2 lakhs and for other reliefs. 3. In the Written Statement filed on behalf of the appellant, announcement in the newspapers as alleged in the plaint were admitted and the authority of the person making the announcement was not disputed. The fact of giving information by the respondent and Giridharilal was admitted and that there were raids on 31st January, 1967 was also admitted. The appellant however denied that the respondent and Giridharilal gave active help on the said date or that the result of such raid on 31st January, 1967 was published in the Statesman dated 5th February, 1967 as was alleged by the respondent. In the Written Statement it was also stated that by a letter dated 25th/26th February, 1970 the respondent and Giridharilal was informed by the appellant that their claim for reward would depend on the discovery of concealed income after examination of the seized materials and on completion of the assessment and collection of extra taxes and thereafter by a letter dated 4th March, 1971 the respondent was informed that the reward payable to the informer was in the nature of ex gratia payment and that the respondent was not entitled to any information in respect of any assessment. It was also denied that by the announcements as published in the news papers the appellant made any promise to pay or made any representation as was alleged by the respondent or that the respondent acted on the basis of any such representation of that relying on any such information the respondent had suffered disadvantages or detriment as was alleged by him. The appellant also denied having any knowledge of the respondent's supplementary affidavit dated 14th August, 1974 and disputed the correctness thereof. The appellant's case was that payment of reward being ex gratia in its nature the suit was misconceived and not maintainable in law. The validity and legality and legality of the notice under S. 80 of the Civil Procedure Code were disputed. Further, according to the appellant, there was no acknowledgement of liability by it. 4. Before the learned trial Judge following issues were raised ; "1(a). Has the defendant made any representations to the plaintiff to pay a reward as alleged in the plaint ? (b). If so, has the plaintiff suffered to his detriment by acting on the alleged representation alleged to have been made by the defendant ? 2. Is the plaintiff entitled to recover the money claimed in the suit under S. 70 of the Indian Contract Act ? 3. Has the defendant through its Income-Tax Commissioner Mr. Krishnamurty admitted the plaintiff's claim in writing by affidavit affirmed on 29th February, 1972 in C.R. No. 2619(W) of 1971 as alleged in paragraph 19 of the plaint ? 4. Did the defendant realise Rs. 8 crores as alleged in paragraphs 1 and 3 of the plaintiff's supplementary affidavit dated 14th August, 1972 alleged in paragraph 20 of the plaint ? 5. Has the plaintiff any cause of action against the defendant ? 6. To what relief, if any, is the plaintiff entitled ? " 5. It appears that before the trial Court evidence was given by the respondent and Giridharilal. No oral evidence was, however, adduced on behalf of the appellant. 5. Has the plaintiff any cause of action against the defendant ? 6. To what relief, if any, is the plaintiff entitled ? " 5. It appears that before the trial Court evidence was given by the respondent and Giridharilal. No oral evidence was, however, adduced on behalf of the appellant. The controversy between the parties, before the trial Court, it appears, was in respect of three matters viz., (i) whether the respondent's claim in the suit made on the basis of promissory estoppel was maintainable; (ii) whether the respondent was entitled to claim compensation under S. 70 of the Indian Contract Act; and (iii) what was the amount of compensation the respondent was entitled to ? 6 The learned trial Judge after elaborately dealing with the documentary and oral evidence and the relevant cases cited before her came to the conclusion that the respondent had a cause of action on the basis of promissory estoppel and therefore the suit was maintainable against the appellant. The learned trial Judge also did not accept that the appellant's promise was not representation but was an intimation of ex gratia payment to the informer depending on the discretion of the government. Regarding the respondent's claim made on the basis of S. 70 of the Contract Act, relying on a decision of the Supreme Court reported in AIR 1962 SC 779 (State of West Bengal v. B. K. Mondal) the learned trial Judge was of the view that supply of information and rendering of active help by the respondent and the discovery of concealed income by the appellant on the basis of such information were established by both oral and documentary evidence in the suit and in doing so the respondent had no intention to act gratutiously as was proved by oral and documentary evidence. Accepting the respondent's case learned trial Judge was of the view that the respondent's claim also came under S. 70 of the Contract Act. 7. On the question of compensation learned trial Judge relying on the provision of Ss. Accepting the respondent's case learned trial Judge was of the view that the respondent's claim also came under S. 70 of the Contract Act. 7. On the question of compensation learned trial Judge relying on the provision of Ss. 106 and 114(g) of the Evidence Act came to the conclusion that the onus to prove realization of extra tax was on the appellant as the same was within its special knowledge and the court was entitled to raise presumption that the appellant had suppressed evidence from the court because the same would support the respondent's case that the appellant had realised extra tax to the extent of Rs. 8 crores. The learned trial Judge answered all the issues in the affirmative and in favour of the respondent and passed a decree for Rs. 2 lakhs with interim interest at the rate of 6% per annum as stated in the judgment and the decree. 8. Being aggrieved by the judgment and the decree the appellant, Union of India, has preferred the instant appeal. Here it may be noted that the respondent has also filed a cross-objection. The ground taken by the respondent is that as the learned trial Judge has accepted the case, in view of uncontradictory evidence, that the appellant had realised a minimum of eight crores of rupees as extra taxes as a result of information supplied by the respondent and Ganatra it should have been held that the respondent was entitled rupees four lakhs being half of 10% of the said amount of extra tax. 9. In this appeal arguments were advanced on behalf of the parties on the same three points which were argued in the trial court. 10. On the first point i.e., promissory estoppel it was submitted on behalf of the appellant that there was no pleading of promissory estoppel. According w the appellant's' counsel there are three ingredients of promissory estoppel namely, (i) representation; (ii) acting on the basis of such representation and (iii) altering ones position to his prejudice or detriment. Counsel has submitted that all the elements constituting the promissory estoppel have neither been pleaded nor proved in the instant case. It has been further argued that the doctrine of promissory estoppel is not available against the government in exercise of its soverign executive and legislative functions. Counsel has submitted that all the elements constituting the promissory estoppel have neither been pleaded nor proved in the instant case. It has been further argued that the doctrine of promissory estoppel is not available against the government in exercise of its soverign executive and legislative functions. It has also been submitted that according to the relevant cases on the point for the application of the doctrine of promissory estoppel, there must be a pre-existing obligation which is absent in the instant case. It is further submitted that even assuming that the respondent has altered his position still how the Court would value such altered position in the facts of this case. In support of the above submissions counsel relied on the cases of the Bihar Eastern Gangetic Fishermen Corporation Ltd v. Sipahi Singh & Ors, AIR 1977 SC 2149 ; Union of India v. Anglo Afgan Agencies, AIR 1968 SC 718 ; Century Spinning & Manufacturing Co. Ltd. v. The Ulhasnagar Municipal Council & Anr., AIR 1971 SC 1021 ; Excise Commissioner. U.P. Allahabad etc. v. Ram Kumar AIR 1976 SC 2237 ; M/s. Motilal Padampat Sugar Mills Co. Ltd. v. State of U. P. & Ors. AIR 1979 SC 621 and M/s. Jitram Kumar & Ors. v. The State of Haryana & Anr. AIR 1980 SC 1285 . 11. In support of the respondent's claim and cause of action founded on promissory estoppel respondent's counsel mainly relied on the decision of the Supreme Court in the case of M. P. Sugar Mills (supra). It was submitted that according to the above decision a claim or cause of action can be founded on the doctrine of promissory estoppel. According to Counsel, what is necessary is that there must be a representation by a party and by acting on the basis of such representation the other party has altered his position. It is submitted that in the instant case as will appear from the documentary and the oral evidence that on the basis of representation made on behalf of the appellant, the respondent had altered his position and the respondent had in fact suffered detriment because he had to go out of the business in jute market. 12. It is submitted that in the instant case as will appear from the documentary and the oral evidence that on the basis of representation made on behalf of the appellant, the respondent had altered his position and the respondent had in fact suffered detriment because he had to go out of the business in jute market. 12. Learned trial Judge in his judgment in accepting the respondent's claim founded on the basis of promissory estoppel has mainly relied on the decision of the Supreme Court reported in AIR 1979 SC 621 . Since in judgment appealed against observations of the Supreme Court in that case so far as relevant to the facts of this case has been quoted in extenso to avoid prolixity it is not necessary to reiterate the same. From the said decision it appears that where one party has by his words or conduct made to the other a clear and unequivocal promise which is intended to create legal relations or effect a legal relationship to appeal in future knowing or intending that it would be acted upon by the other party to whom promise is made and it is in fact so acted upon by the other party the promise would be binding on the party making it and he would not be entitled to go back upon it, if it would be inequitable to allow him to do so having regard to the dealings which have taken place between the parties and this would be irrespective of whether there is any pre-existing relationship between the parties or not. It further appears that the doctrine of promissory estoppel need not be inhibited by the same limitation as estoppel in the strict sense of the term. It being an equitable principle involved by the Courts for doing justice there is no reason why it should be given only limited application by way of defence. It was further observed that there was no reason or logic or principle why promissory estoppel should also not be available as a came of action. Further, for application of the doctrine of promissory estoppel it is not necessary that the promisee acting in reliance of the promise should suffer any detriment but what is necessary is only that the promisee should have altered his position in reliance on the promise. Further, for application of the doctrine of promissory estoppel it is not necessary that the promisee acting in reliance of the promise should suffer any detriment but what is necessary is only that the promisee should have altered his position in reliance on the promise. But if by detriment it is meant some injustice to the promisee which results if the promissor were allowed to recede from his promise the detriment would certainly come in as a necessary ingredient. In the above case Supreme Court has in detail dealt with the doctrine of promissory estoppel as applicable in India. 13. In our view, the principle as laid down in the above case is fully applicable to the facts of the instant case. Neither the representation made on behalf of the appellant nor action upon the same by the respondent by supplying information regarding concealed income by various parties in the jute market are disputed. The only point taken on behalf of the appellant was that the reward payable to the persons supplying information regarding concealed income was merely ex gratia in its nature. We are unable to accept this contention of the appellant. In our view, learned trial judge rightly applied the principle laid down in AIR 1979 SC 621 and on the basis of the said decision came to the conclusion that the respondent's cause of action founded on the principle of promissory estoppel was valid. We are also of the view that there is sufficient pleading about the respondent's case based on promissory estoppel. In this connection it should be noted that pleadings have to be interpreted not with formalistic rigour but with latitude of or awareness of low legal literacy of the people. See Smt. Manjushri Raha v. B. L. Gupta, AIR 1977 SC 1158 . 14. The next point that arises for consideration is whether the respondent's claim based on S. 70 of the Indian Contract Act is maintainable. It appears that this cause of action has been specifically pleaded by way of amendment in paragraph 3(A) and 4(A) of the plaint. 15. On behalf of the appellant it has been submitted that in the instant case the respondent's claim based on S. 70 of the Indian Contract Act is not maintainable. According to the appellant's counsel, the respondent has not proved any change in his position and therefore, the question of restitution does not arise. 15. On behalf of the appellant it has been submitted that in the instant case the respondent's claim based on S. 70 of the Indian Contract Act is not maintainable. According to the appellant's counsel, the respondent has not proved any change in his position and therefore, the question of restitution does not arise. Further, there was no unjust enrichment by the government. It was further submitted that even if any benefit was derived by the respondent, according to counsel, no benefit arose out of the information supplied by the respondent. Further, the respondent has also not proved what is the reasonable compensation which he would be entitled to. Therefore, according to counsel, in the instant case S. 70 of the Indian Contract Act has no application. 16. On behalf of the respondent, it has been submitted that in the instant case all the requirements of S. 70 of the Indian Contract Act have been satisfied. It was submitted that the information relating to concealed income was supplied by the respondent to the appellant's officer and in doing so the respondent did not act gratuitously. By reason of the information so supplied by the respondent, the appellant obtained benefit because by utilising and/or on the basis of such information the appellant was able to detect concealed income and realise taxes on such concealed income. Counsel submitted that in the instant case reasonable compensation would be to the extent of eight crores because that amount has been realised by the appellant on the basis of information supplied by the respondent and Ganatra. The appellant has however reduced his claim and such claim is made on the basis of 10% of the amount realized by the appellant. 17. It appears that in upholding the respondent's claim based on S. 70 of the Indian Contract Act learned trial Judge has relied on a decision of the Supreme Court in the case of State of West Bengal v. B. K. Mondal & Sons reported in AIR 1962 SC 779 . According to the learned trial Judge, in view of the said decision of the Supreme Court the decision in the case of B. N. Elias & Co. According to the learned trial Judge, in view of the said decision of the Supreme Court the decision in the case of B. N. Elias & Co. Ltd. v. State of West Bengal reported in AIR 1959 Cal 247 cited on behalf of the appellant in the trial Court could not be considered to be good law and the Supreme Court's decision had the effect of overruling the said Calcutta decision by implication. According to learned trial judge, all the requirements for the application of S. 70 of the Contract Act have been satisfied in the instant case. 18. In this case from the evidence both documentary and oral as mentioned in the judgment of the learned trial judge in detail it appears that the information given and the active help rendered by the respondent led to discovery of concealed income by the appellant. Giving of information and rendering of help and assistance by the respondent for discovering the concealed income of the various parties are not disputed. From the oral and documentary evidence in the instant case it would appear that the respondent supplied information and rendered help to the officers of the appellant in connection with discovery of concealed income from various concerns in the Jute market and in doing so the respondent did not intend to act gratuituously. There is not denial of the fact by the appellant that due to searches made by the officers of Income-tax Department concealed income was detected. In our view, the learned trial Judge has rightly applied the principle laid down in B. K. Mondal’s case. So far as this aspect of this case the only question upon which stress was given by the appellant and which needs consideration is what would be the amount of reasonable compensation which the respondent would be entitled to in the facts and circumstances of this case. This aspect of the case is dealt with in connection with the question of quantum of compensation claimed by the respondent. 19. The question of quantum of compensation is very much disputed in this case. According to the respondent's counsel, realisation of rupees eight crores by the appellant as tax has been established. This aspect of the case is dealt with in connection with the question of quantum of compensation claimed by the respondent. 19. The question of quantum of compensation is very much disputed in this case. According to the respondent's counsel, realisation of rupees eight crores by the appellant as tax has been established. In support of such realisation counsel has relied on the supplementary affidavit in the writ proceedings taken by the respondent; respondent's letter dated 10th November, 1972, notice under S. 80 of the Code of Civil Procedure given on behalf of the appellant and the oral evidence of the respondent and his witness Gridharilal. It was further submitted that all the relevant records showing the amount of tax realised in possession of the appellant have been suppressed. According to counsel, in the instant case as all the information regarding realisation of tax being within the special knowledge of the appellant the onus of proving the same is upon the appellant in view of S. 106 of the Evidence Act. Further, in as much as all the relevant records and information have been withheld by the appellant from the Court adverse presumption under S. 114(g) has been rightly drawn by the learned trial Judge against the appellant. It was fun her submitted that S. 137 of the Income Tax Act, 1961 was deleted with effect from 1st April 1964 by the Finance Act 1964 and hence statutory bar against disclosure of documents by the appellant was removed. Regarding the supplementary affidavit relied upon by the respondent it was submitted that the same being a public document there is no necessity of proving the statements contained therein by the person affirming the same. It was also submitted that the letter dated 10th November, 1972 and the notice under S. 80 of the Code of Civil Procedure were not replied to by the appellant and that would amount to admission of the fact that rupees eight crores were realised by the appellant as tax. 20. In support of the above submissions reliance was placed on Gopal Krishnaji Ketkar v. Mohd. Haji Latif, AIR 1968 SC 1413 , Collector of Customs, Madras and Others v. D. Bhoormul, AIR 1974 SC 859 ; Smt. Sattya v. Teja Singh, AIR 1975 SC 116; Sarju Pershad Ramdeo Sahu v. Jweleshwari, AIR 1951 SC 120 ; Chand Sultan alias Indra Bai v. Khurshid Begum & ors. Haji Latif, AIR 1968 SC 1413 , Collector of Customs, Madras and Others v. D. Bhoormul, AIR 1974 SC 859 ; Smt. Sattya v. Teja Singh, AIR 1975 SC 116; Sarju Pershad Ramdeo Sahu v. Jweleshwari, AIR 1951 SC 120 ; Chand Sultan alias Indra Bai v. Khurshid Begum & ors. AIR 1963 A.P. 365 ; M.S.K. Mills Co. v. K. V. Kamath, AIR 1959 Mysore 180; Madamanchi Ramappa & anr. v. Muthalaru Bojippa. AIR 1963 SC 1633 ; Bhagwati Prasad v. Chandramaul, AIR 1966 SC 735 ; Smt. Manjushri Raha v. B. L. Gupta, AIR 1977 SC 1158 & M/s. Ganesh Trading Co. v. Moji Ram, AIR 1978 SC 484 . 21. According to the counsel for the appellant, in the instant case the amount of compensation has not been proved by the respondent It was submitted that the evidence of the respondent and his witness, Giridharilal, regarding the fact that rupees eight crores were realised by way of tax was heresay because such information, as would appear from the evidence, was received by them from the market. In this connection counsel has referred to the evidence of the respondent (Question Nos. 252 to 255, 309) and Giridharidal (Question Nos. 109, 110 and 242 to 244). On the question of non-admissibility of the heresay evidence counsel has relied on the cases of S. Partap Singh v. State of Punjab, AIR 1964 SC 72 ; Laliteshwar Prasad Sahi v. Bateshwar Prasad & ors. AIR 1966 SC 580 ; Liem Yam Hong & Co., v. Lam Choon & Co. AIR 1928 PC 127; Miller v. Babu Madho Das, 23 IA 106 & Hallsbury’s Laws of English (3rd Edition) Volume 15, paragraph 533 at page 299. Counsel has further submitted that even if the heresay evidence is not objected to it cannot be treated as legally admissible evidence. 22. Regarding the letter dated 10th November, 1972 at page 21 of the supplementary paper book it was submitted that the statement in this letter regarding quantum of tax recovered is also heresay. It was submitted that the said letter was pleaded in paragraph 22 of the plaint but the receipt of the same was denied in paragraph 21 of the writted statement. Counsel submitted that the comment of the learned Judge at page 219 of the paper book regarding this letter is not correct. It was submitted that the said letter was pleaded in paragraph 22 of the plaint but the receipt of the same was denied in paragraph 21 of the writted statement. Counsel submitted that the comment of the learned Judge at page 219 of the paper book regarding this letter is not correct. The statement in this letter regarding amount of tax realised is in the nature of heresay and therefore, cannot be taken into account as proof of the amount of compensation. 23. Regarding supplementary affidavit filed by the respondent in the writ proceedings as mentioned earlier it was submitted on behalf of the appellant that in paragraph 19 of the written statement it has been stated that the appellant had no knowledge of this supplementary affidavit. It was further submitted that in the instant case the supplementary affidavit has neither been tendered nor exhibited. Further, nobody has come forward to prove the contents of the said affidavit. It was also submitted that the relevant paragraph i.e., paragraph 3 of the supplementary affidavit was affirmed as based on information, derived from official circular of the Income Tax Department. Further, in his letter dated 12th February, 1971 (Ext. XX) written to Central Board of Direct Taxes it is Stated that the respondent is in possession of relevant records. In spite of such statement no records have been produced by the respondent to substantiate his claim. In this connection, reference was made to the respondent's answer to question No. 214. Counsel has also submitted that the supplementary affidavit cannot be treated as public document and as such without being properly proved it cannot be admitted as evidence. In any event, according to counsel, even if the supplementary affidavit is treated as a public document it would only show that some statement was made but without the evidence of the person making the affidavit its contents cannot be said to have been proved. In this connection, counsel has refereed to S. 74 of the Evidence Act and the cases Akshoy Kumar Bose v. Sukumar Dutta, AIR 1951 (Calcutta 320 and Tarakeswar Prasad Tewari v. Devendra Prasad Tewari AIR 1926 Patna 180. In this connection, counsel has refereed to S. 74 of the Evidence Act and the cases Akshoy Kumar Bose v. Sukumar Dutta, AIR 1951 (Calcutta 320 and Tarakeswar Prasad Tewari v. Devendra Prasad Tewari AIR 1926 Patna 180. Counsel has further submitted that mere silence on the part of the appellant after receipt of the letter dated 10th November, 1972 and the notice under S. 80 of the Evidence Act (Exhibit 'HHH') cannot be construed as admission on the part of the appellant. It was submitted that mere silence would not amount to admission according to S. 17 of the Evidence Act. Mere omission to give a reply to a letter does not amount to admission. There must be positive evidence by the person asserting any particular fact. In this connection reliance was placed on Bank of India Ltd. v. Rustom Fakirji Cowasjee, AIR 1955 Bombay 419 at paragraph 25, Thipson' Law of Evidence (12th Edition) paragraph 769 at page 330 and 1891 (2) Q.B. 543. 24. Regarding the application of S. 106 of the Evidence Act and S. 114(g) of the Evidence Act, it was submitted by the appellant's counsel that in the instant case the facts regarding the amount realised by way of extra tax by the appellant were also known to the respondent as will appear from the respondent's letter dated 12th February, 1971 (Ext, XX). it was further submitted that several applications were made against the appellant by the respondent for discovery and interrogatories but no order was made thereon. Learned, trial Judge also did not make any order on such application made by the respondent. Therefore, in the above context of the facts adverse presumption should not be drawn in against the appellant, Counsel also submitted that in any event, the respondent is not entitled to any reward in respect of the amount of tax realised by the appellant out of voluntary disclosure made by different parties. 25. It appears that in coming to the conclusion that rupees eight crores were realised as tax learned trial Judge his mainly relied on the evidence of the plaintiff and Giridharilal. Further, according to the learned trial Judge the amount of tax realised by the appellant was within its special knowledge and no evidence was adduced on behalf of the appellant regarding amount of tax recovered. Further, according to the learned trial Judge the amount of tax realised by the appellant was within its special knowledge and no evidence was adduced on behalf of the appellant regarding amount of tax recovered. The learned trial Judge therefore relied upon S. 106 and S. 114(g) of the Evidence Act and drew adverse inference against the appellant. On this aspect of the case, we are unable to accept the learned trial Judge's finding that rupees eight crores was realised by the appellant by utilising the information given by the respondent. Although the respondent in his letter dated 12th February, 1971 stated that he had in his possession records to prove recovery of eight crores as tax yet no documents were produced by him. Further, although several applications were made by the respondent for disclosure of documents by the appellant yet no order was made thereon. It is true that regarding realisation of tax no document was disclosed by the appellant nor anybody on behalf of the appellant came forward to give evidence about the same but at the same time the respondent's statement that he had in his possession records to prove the amount of tax realised by the appellant cannot be overlooked. Further, although respondent knew about the parties from whom tax was realised yet neither any step was taken by the respondent for production of documents by any one of such parties nor for calling anyone of them to give evidence. The evidence of the respondent and Giridharilal as rightly submitted by the appellant's counsel being heresay as stated hereinbefore the same cannot be relied upon. Nor the statements in the further affidavit regarding the amount of tax realised be taken as admissible in evidence because the same has neither been tendered in evidence nor made an exhibit. Hence, the statements made therein cannot be said to have been proved. Therefore, the statements in the said further affidavit cannot be taken as admissible evidence in this case. On the other hand the fact of non-production of relevant documents showing recovery of tax realised by the appellant and the absence of any evidence on the part of appellant regarding the above fact cannot be ignored. In view of the above learned trial Judge's finding relying upon Ss. On the other hand the fact of non-production of relevant documents showing recovery of tax realised by the appellant and the absence of any evidence on the part of appellant regarding the above fact cannot be ignored. In view of the above learned trial Judge's finding relying upon Ss. 106 and 114(g) of the Evidence Act that rupees eight crores were realised by the appellant does not appear to us to be correct. In the aforesaid view of the matter learned trial Judge's answer to issue no. 4 does not appear to be correct and the same is set aside. Further, the learned trial Judge has not indicated the ground on which a decree for rupees two lakhs is based and, therefore, we also set aside the decree passed by the learned trial Judge. 26. In this case we are confirming the findings and answers of the learned trial Judge on other issues. As stated earlier the only question that remains to be decided is determination of the amount of compensation. Form the facts and circumstances of this case and considering the evidence on record it appears to us that taxes were realised and/or recovered by the appellant utilising the information given by the respondent. But from the evidence the exact amount of tax realised by the appellant cannot be ascertained. Therefore, the question of determination of the amount realised as tax by the appellant by utilising the information given by the respondent should be referred to reference. The finding of the learned trial Judge on issue no. 4 and the decree are set aside. Cross-objection filed by the respondent is also dismissed. We, however, direct that the question as to what amount of tax that has been realised by the appellant by utilizing the information given by the respondent to the appellant be referred to the Registrar, O. S. and accordingly there will be a preliminary decree for accounts. It is, however, made clear that the respondent will not be entitled to any compensation on the amount of tax that has been realised by the appellant due to voluntary disclosures made by the different parties. The referee will submit his report within six months from date. Cost of reference and the cost of hearing of the appeal are reserved. The Chief Justice–I agree.