K. Chidambara Mudaliar and Others vs A.P. Arunachala Mudaliar

Anantanarayanan, J.—The only point involved in this appeal by defendants 2 to 7 in the suit, who are members of a Panchayat Board, which

was also sued as the first defendant, is with reference to the interpretation of Section 108 of the Madras Village Panchayats Act, 1950.

Learned Counsel for the appellants concedes that he is concluded by the concurrent findings of the Courts below, with regard to the actual

facts. It has thus been clearly found that the present appellants acted under the influence of malice and ill-will, and virtually, misused their powers as

the members of this Panchayat. Because they did so, and that rendered them liable to be sued in damages in a Court of law, since they lacked

bona fides altogether, though they purported to act in an official capacity, the learned Subordinate Judge has awarded a sum of Rs. 100 as

damages to the plaintiff-respondent to be recovered from the appellants. The question is whether upon the proper interpretation of Section 108,

the appellants can plead any absolute immunity in this respect.

Section 108 of the Madras Village Panchayats Act, 1950, runs as follows:

No suit or other legal proceeding shall be brought against the President, Executive Authority or any member, officer or servant of a Panchayat, or

any person acting under the direction of a Panchayat or of such President, Executive Authority, member, officer or servant, in respect of any act

done or purporting to be done under this Act, or in respect of any alleged neglect or default on his part in the execution of this Act, or any rule, by-

law, regulation or order made under it, if such act was done or such neglect or default occurred in good faith; but any such proceeding shall, so far

as it is maintainable in a Court, be brought against the Panchayat except in the case of suits brought u/s No.

A careful study of this section will show that it embodies a statutory protection with regard to the President, the Executive Authority, or any

member, officer or servant of a Panchayat, acting in good faith. That is also indicated by the marginal heading, though I am attaching little

importance to this, in view of a principle of construction of statute that the text of the enactment is the proper basis for such construction and that

marginal headings may be sometimes erroneous or misleading. The Legislature has thought it fit to protect the President, the Executive Authority,

member, officer, etc., so long as the act was done or purported to be done in exercise of any powers vested in such persons under the enactment,

and it was done in good faith. The same protection extends to any neglect or default also. The clear corollary is that the protection does not cover

acts which, though purporting to be done in exercise of official power, were committed with mala fides. This is also in consonance with the well-

known principle of the Common Law, which stems from a considerable lineage of decisions both in England and in this country, that persons who,

while purporting to act in exercise of official power, exceed that power mala fide and out of improper motive, and cause injury, are liable to be

sued upon for damages in a civil Court of law. The last part of Section 108 declares that any such proceeding, to the extent to which it is

maintainable in a Court, shall be brought against the Panchayat.

The question is whether the interpretation should be either (1) that the President and other officers of the Panchayat are fully protected with

regard to the official Acts done in good faith, while they are not protected in the context of mala fides, while suits may be brought against the

Panchayat as such, where its officers, even when acting in good faith cause injury which renders that Panchayat, as a body, liable in tort for

damages, or (2) whether the interpretation should be that, even where the acts of the officers are tainted by mala fides, they are not suable as such,

but only the Panchayat could be sued for damages.

I have very carefully considered this matter. My hesitation has been great, because I find that a learned Judge of this Court (Kunhamed Kutti, J.)

has taken a different view from that which I am inclined to take in S.A. No. 602 of 1958 (unreported). The learned Judge thought that significance

had to be attached to the word "" such "" in the latter part of the section. For this reason, he thought that even when the acts were not done in good

faith, the proceedings could be maintained against the Panchayat alone, and were not maintainable against the individual members. As far as this

argument is concerned, it seems to me, with great respect, that a converse inference could be equally drawn. Gould it not be argued that the very

use of the word "" such proceeding "" implies a proceeding in respect of an act, neglect or default which "" occurred in good faith "", and for which the

President, etc., could not be individually sued?

It is true that the last part of the section enunciates an exception, viz., suits brought u/s No. But a scrutiny of section no shows that it is limited to

cases of loss, waste or misapplication of property by the President, etc. and to actions by the Panchayats against such officer for damages. The

interpretation placed upon Section 108 by learned Counsel for the appellants, appears to me to suffer from a double disadvantage or defect.

Firstly, it is a well-known principle that where, under cloak of an official authority or status, a person acts mala fide and causes injury due to ill-will,

abusing his powers, he is liable to be sued for damages in the civil Courts of the land, under the common law. I am not at all clear that the

Legislature ever intended that some extraordinary immunity from this wholesome liability should be conferred, upon members of Panchayats in

particular. Secondly, it is an equally well-recognised maxim that the liability in tort of an employer or a corporation, may not extend to those acts of

the servants which, under cloak of official authority, exceed those bounds altogether, and are really acts of individual malice or ill-will, abuses of

power which might even amount to crimes. It is certainly unusual and paradoxial to contend that, in such cases, the corporation is totally liable to

be sued upon, while the concerned delinquent officer gets a total immunity. It is for this reason that with great respect, I am unable to follow the

interpretation placed upon the section in S.A. No. 602 of 1958 by the learned Judge of this Court. In my view, the words "" such proceeding

occurring in the last part of Section 108 really occasion no problem of interpretation. They merely designate a proceeding in Court, against the

Panchayat as liable in damages for the acts of its servants which are contrary to law and have occasioned injury, though the servants themselves

are protected because of their bona fides. Those words cannot be interpreted, in my view, to sustain an inference that the proceedings must

necessarily be one establishing the mala fides of the officer and that it must be pressed home against the Panchayat alone.

In this context, the judgment of Jagadisan, J. in A. Gunamani Vs. W.R. Stephen and Others, , is of interest and some significance. As the

learned Judge has observed therein, a corporation cannot be immune from liability in respect of torts brought about at its instance. In such cases,

the corporation is a joint tort-feasor along with the agent or servant. The Municipality is therefore liable to pay damages for its unlawful act in

having brought about the destruction of a dog, privately owned, which was not dangerous. This very clearly shows that a Municipality or a

Panchayat may be liable even where there is no question of mala fides at all. This lends support to the interpretation that I would place upon the

last part of Section 108. But where the Municipality or Corporation may not be liable, in the sense that it only authorised bona fide acts of exercise

of power, while the concerned servant went beyond those bounds and acted mala fide and caused injury, the concerned servant should certainly

not be immuned from suit in a Court of law. The contrary interpretation would confer on him something like the absolute immunity conferred upon

Judges under the Judges Protection Act. But that is a very special immunity, recognised in all systems of jurisprudence, and enacted because of the

peculiar character of the judicial office, and the necessity to safeguard it. I am quite unable to see how such immunity could be extended to officers

or members of local bodies, such as Panchayats or municipal corporations, exercising powers vested in them under special enactments.

The Second Appeal accordingly fails and is dismissed. The parties will bear their own costs here. Leave granted.