K. R. Kurup v. S. T. A. T — 1989 DIGILAW 487 (KER)

Judgment :- 1. The petitioner is O.P.2025 of 1985, Shri. K.R. Kurup a practising advocate of this Court has been appointed as Standing Counsel for Regional Transport Authorities and State Transport Authority in the State Transport Appellate Tribunal for three years. After the expiry of the said term of three years on 15-7-1985, Shri. K.K. Dharmalal, Advocate who is the petitioner in O.P. 11479 of 1985 was appointed as Standing Counsel for Regional Transport Authorities and State Transport Authority in the STAT for a period of two years. His term of appointment expired on 27-11-1987 and thereafter Shri. P. Santhoshkumar, Advocate was appointed as Standing Counsel for a period of two years. The short question arising for consideration is whether the Standing Counsel is required to affix stamp under the Advocates' Welfare Fund Act on the memoranda filed before the STAT. 2. The petitioners in the Original Petitions took the stand before the STAT that they are not bound by law either to file a vakalath or any memo of appearance. Alternatively it is contended that the memoranda of appearances filed by the petitioners can be considered as exempted under the proviso to S.23(1) of the Advocates' Welfare Fund Act. The first respondent took the stand that the petitioners are not appearing on behalf of the Government and therefore they were directed to file memoranda of appearance duly stamped. This order of the STAT dated 26-2-1985 is produced as Ext.P2 in O.P. 2025 of 1985, and 10694 of 1987. Therefore there is a prayer in the said Original Petitions to quash Ext.P2 also. The main prayer canvassed on behalf of the petitioners at the time of hearing is for a declaration that the petitioners are not bound to affix Welfare Fund Stamp on the memoranda of appearances that are to be filed by them in STAT so long as they are Standing Counsel for the State Transport Authority and Regional Transport Authorities. 3. S.23 of the Kerala Advocates' Welfare Fund Act, 1980 is as under: "23. Vakalath to bear stamps:-(1) Every member of the Fund shall affix one stamp on every vakalath filed by him and no vakalath shall be filed before or received by any court, Tribunal or other authority unless it is so stamped. 3. S.23 of the Kerala Advocates' Welfare Fund Act, 1980 is as under: "23. Vakalath to bear stamps:-(1) Every member of the Fund shall affix one stamp on every vakalath filed by him and no vakalath shall be filed before or received by any court, Tribunal or other authority unless it is so stamped. Provided that nothing contained in this sub-section shall apply in respect of any memorandum of appearance filed by an Advocate appearing on behalf of the Government. 2. The value of the stamp shall neither be costs in the case nor be collected in any event from the client. 3. Any contravention of the provisions of sub-section (2) by any member shall disentitle him to the benefits of the Fund and the Trustee Committee shall report such instances to the Bar Counsel for appropriate action." S.23 has been amended by Act 21 of 1989 with effect from 6th May, 1989 as under: "9. Amendment of S.23:-In S.23 of the principal Act, for sub-section (1), the following sub-section shall be substituted, namely: "(1) Every vakalath filed by an Advocate shall be affixed with a stamp in addition to the court fee stamps affixed thereon, and no vakalath shall be valid unless so stamped. Explanation: If two or more Advocates jointly appear by a single vakalath separate stamps shall be affixed by each of such Advocates." 4. In these petitions I am concerned with the unamended Section. S.23 requires every member of the fund to affix one stamp on every vakalath filed by him and no vakalath shall be filed before or received by any court, Tribunal or other authority unless it is so stamped. The petitioners are members of the Fund. Under S.2(n) of the Act'Vakalath' has been defined to mean vakalathnama and includes memorandum of appearance or any other document by which an advocate is empowered to appear or plead before any court, Tribunal or other authority. The contention that under S.30 of the Advocates Act every advocate shall be entitled as of right to practice throughout the territory of India and therefore they are entitled to appear even without a vakalath is not tenable. In any case, S.30 of the Advocates Act relied upon by the petitioners only says that there shall be only one class of persons en titled to practice the profession of law, namely, Advocates. In any case, S.30 of the Advocates Act relied upon by the petitioners only says that there shall be only one class of persons en titled to practice the profession of law, namely, Advocates. That will not entitle the petitioners to appear without a memorandum of appearance. Therefore the petitioners had to file memoranda of appearance before the STAT. As the petitioners are members of the Fund and are also filing memoranda of appearance they have to affix one stamp on every memorandum of appearance filed and no memorandum shall be filed before or received by the Tribunal unless it is so stamped. 5. But there is an exemption given by the proviso to S.23 of the Act which says that nothing contained in the sub-section shall apply in respect of any memorandum of appearance filed by an advocate appearing on behalf of the Government. In I.T. Commr. v. I.M. Bank Ltd. AIR 1959 SC 713 the Supreme Court observed: "The proper function of a proviso is that it qualifies the generality of the main enactment by providing an exception and taking out as it were, from the main enactment, a portion which, but for the proviso would fell within the main enactment. Ordinarily it is foreign to the proper function of a proviso to read it as providing something by way of an addendum or dealing with a subject which is foreign to the main enactment. XX XX XX The territory of a proviso therefore is to carve out an exception to the main enactment and exclude something which otherwise would have been within the section. It has to operate in the same field and if the language of the main enactment is clear it cannot be used for the purpose of interpreting the main enactment or to exclude by implication what the enactment clearly says unless the words of the proviso are such that that is its necessary effect." Therefore the proviso to S.23 of the Act has to be construed as an exception. Whether exception has to be construed strictly or liberally will depend upon the language of the Section and the purpose of the legislation. 6. The Kerala Advocates' Welfare Fund Act, 1980 is an Act to provide for the constitution of a welfare fund for the payment of retirement benefits to Advocates in the State of Kerala and for matters connected therewith or incidental thereto. 6. The Kerala Advocates' Welfare Fund Act, 1980 is an Act to provide for the constitution of a welfare fund for the payment of retirement benefits to Advocates in the State of Kerala and for matters connected therewith or incidental thereto. It provides for social security measures for the legal profession. S.3 provides for constitution of the Advocates' Welfare Fund consisting of all amounts paid by the Bar Council, contribution made by the Bar Council, voluntary donation or contribution made by the Bar Council of India, any Bar Association, any other association etc.,grant made by the State Government to the Fund, the amount set apart from the Legal Benefit Fund constituted under sub-section (2) of S.76 of the Kerala Court Fees and Suits Valuation Act for providing social security measures for the legal profession, all sums collected by way of sale of stamps under S.22 etc. Under S.15 of the Act every advocate practising in the State and being a member of a Bar Association recognised by the Bar Council can apply to the Trustee Committee for admission as a member of the Fund. S.16 provides that a member of the Fund shall, on cessation of practice, be entitled to receive from out of the Fund an amount at the rate specified in the schedule. S.22 of the Act provides for printing and distribution of stamps by Bar Council and S.23 then provides for affixing the stamp on every vakalath filed by a member of the Fund. The Act is a welfare legislation and S.23 provides for collection of amounts for the Fund and therefore exception to S.23 should be interpreted strictly so as not to defeat the purpose of the legislation. 7. In Kedarnath J.M.Co. v. C.T.Officer, AIR 1966 S.C.12, a bench of 3 Judges observed that the exemption provision should be strictly construed. Construing the Bengal Finance (Sales tax) Act, their Lordships observed: "There is an understandable reason for the stringency of the provisions. The object of S.5(2)(a)(ii) of the Act and the rules made thereunder is self-evident. While they are obviously intended to give exemption to a dealer in respect of sales to registered dealers of specified classes of goods, it seeks also to prevent fraud and collusion in a attempt to evade tax. The object of S.5(2)(a)(ii) of the Act and the rules made thereunder is self-evident. While they are obviously intended to give exemption to a dealer in respect of sales to registered dealers of specified classes of goods, it seeks also to prevent fraud and collusion in a attempt to evade tax. In the nature of things, in view of in-numerable transactions that may be entered into between dealers, it will wellnigh be impossible for the taxing authorities to ascertain in each case whether a dealer has sold the specified goods to another for the purposes mentioned in the section. Therefore, presumably to achieve the twofold object, namely, prevention of fraud and facilitating administrative efficiency, the exemption given is made subject to a condition that the person claiming the exemption shall furnish a declaration form in the manner prescribed under the Section. The liberal construction suggested will facilitate the commission of fraud and introduce administrative inconveniences, both of which the provision of the said clause seek to avoid." I am not unaware of the ruling of the Division Bench of the Supreme Court in Petron Engineering Construction P.Ltd. v. C.B.D. T, (1989) 175 I.T.R. 523 wherein it was held: "It is true that an exemption provision should be liberally construed, but this does not mean that such liberal construction should be made by doing violence to the plain meaning of such exemption provision of liberal construction or liberation construction can be made whenever it is possible to be made without impairing the legislative requirement and the spirit of the provision. In our opinion, to construe "foreign enterprise" in S.80-0 as including within it an Indian company or a branch or unit of such company simply because it is located in a foreign country would be against the plain meaning of the term and the legislative intent." The later Division Bench ruling is not in conflict with the decision of the three judges bench of the Supreme Court. The decisions are to the effect that the interpretation which gives effect to the intention of the legislature and which advances the legislative intent as seen from the statute read as a whole should be adopted. The decisions are to the effect that the interpretation which gives effect to the intention of the legislature and which advances the legislative intent as seen from the statute read as a whole should be adopted. If so read, it will be seen that the exception to S.23 of the Act is only for memorandum of appearance filed by Advocates appearing on behalf of the Government and such memorandum filed on behalf of the Government alone need not bear the Welfare Fund Stamp. 8. It is true that the word "Government" has not been defined in the Act. But the same is defined in the General Clauses Act. S.3(23) of the General Clauses Act lays down "Government" to include both the Central Government and any State Government. Therefore appearance on behalf of the Central or State Government alone are exempted under the proviso to S.23 of the Act. 9. Counsel for the respondents referred to the decision in Ram Nandan v. State, A.I.R. 1959 All.101. In Para.23of the decision the Full Bench of the Allahabad High Court observed: "The word 'Government' is not defined anywhere; what is stated in S.3(23) of the General Clauses Act is simply this that "Government" includes both the Central Government and the State Government. Art.52 to 77 deal with the President and Vice-President, the Council of Ministers and the Attorney-General for India. Art.77 is the first article under the heading "Conduct of Government Business" and lays down that all executive action of the Government of India shall be expressed to be taken in the name of the President. Similarly, Arts.153 to 165 deal with the Governor, the Council of Ministers and the Advocate-General for a State; Art.166 is the first Article under the heading "Conduct of Government Business" and provides that all executive action of the Government of a State shall be expressed to be taken in the name of the Governor it is obvious that the word "Government" in Art.77 and 165 means the executive machinery set up with the aid of Arts 53 to 76 and 153 to 165. The word "Government" is also used in other articles, such as 53(3), 58(2), 66(4), 73(1), 76(2),102(1),110(1),112(1) etc. In all these articles "Government" means the executive machinery of the Union and of the States. The word "Government" is also used in other articles, such as 53(3), 58(2), 66(4), 73(1), 76(2),102(1),110(1),112(1) etc. In all these articles "Government" means the executive machinery of the Union and of the States. It means the President acting with the advice of the Council of Ministers and the Governors acting with the advice of their Council of Ministers. It is the system of Government or the institution consisting of the President and the Governors acting with the advice of their Councils of Ministers and not the actual persons holding the offices of the President and Governors and the Ministers advising them." 10. From the above definition of the Government it will be clear that the Regional Transport Authority and the State Transport Authority will not be considered as Government. S.44 of the Motor Vehicles Act 1939 refers to the constitution of the State Transport Authority as chairman and two officers representing the official members and two non-official members. The constitution of Regional Transport. Authority is mentioned therein and they are only statutory authorities constituted under the Motor Vehicles Act consisting of officials and non-officials to do the statutory duties assigned to them. Standing Counsel appointed for Regional Transport Authority and State Transport Authority for representing them in STAT, therefore, cannot be considered as counsel appointed to appear on behalf of the Government. 11. Counsel for the petitioners also submitted that even though standing counsel are not appearing for the Government it can be considered that they are appearing on behalf of the Government. Reference is made to the decision in Kripa Shankar v. Commr. of Wealth Tax, A.I.R.1966 Patna371 wherein it is stated that the two expressions "on behalf of and "for the benefit of convey different meanings. In the former case the holder of the property will be only a representative of the real owner and in the latter case the holder is the legal owner himself. This position will not advance the case of the petitioners. Counsel also referred to the decisions of W.O. Holdsworth v. State of U.P. A.I.R.1957 S.C.887, Uttam Chand v. Emperor, 15 I.C.1007 and O.P. Jain v. Gian Chand, ALR.1959 S.C837. These cases are only authority for the proposition that when a trustee holds the property he is the legal owner of the property even though he holds the same for the benefit of the cestui que trust. These cases are only authority for the proposition that when a trustee holds the property he is the legal owner of the property even though he holds the same for the benefit of the cestui que trust. In that context it is stated that the estate is held by the trustees for the benefit of the beneficiaries. They have two different meanings. In the former case the holder of the property will be only a representative of the real owners and in the latter case the trustee will be the legal owner himself. In Uttam Chand v. Emperor, 15 I.C.1007 the question was whether a master is liable to punishment when his servant has committed an offence by removing ganja. The question was whether the servant was acting on behalf of the master. It is held in that case that the servant travelled beyond the scope of his employment and therefore the servant was not acting on behalf of the master. It is observed: "but when he travelled beyond the scope of that business, it is not possible to implicate the petitioner in his acts which were not done for the benefit of the petitioner but rather for Lakhi Chand's private purposes. The expression "on behalf of connotes some benefit to the persons on whose behalf another person may act." These decisions will not help the petitioners in these cases as their filing of vakalaths will not in anyway considered as an action on behalf of or for the benefit of the Government. The Government also will not be a party to the proceedings and therefore the question of representing the Government does not arise when the petitioners file memoranda before the STAT representing the State Transport Authority or Regional Transport Authority. 12. Admittedly in these cases the petitioners are members of the Welfare Fund. Therefore they have to affix Welfare Fund stamps on the vakalaths. There is no merit in the Original Petitions. The Original Petitions are, therefore, dismissed. There will be no order as to costs.