Panchayat Union Council and Another vs C. Tirupathy

K. Veeraswami, C.J.—The respondent instituted a suit for recovery of salary for the period from 10th January, 1958 to 26th April, 1959.

The basis of the claim was that his services as Headmaster were illegally terminated by the Panchayat Board with effect from 19th January, 1958,

and that the removal order was reversed on appeal and that consequently he was reinstated in service with effect from 27th April, 1969. The suit

was resisted by the appellant on the ground, among others, that it did not lie u/s 170 of the Madras Panchayats Act, 1958. This defence was

accepted by the trial Court which dismissed the suit. The respondent was, however, successful in his appeal. The Panchayat is the appellant in the

second. appeal. Kailasam, J., who heard the second appeal, felt the applicability of the section to the suit raised an important question of

construction thereof and it should, therefore, be decided by a Full Bench. The learned Judge was also of the view that the reference was necessary

as he thought that The Panchayat Board Vs. The Western India Matches Company by Agent Henrik Hybbidnettee, , in interpreting the scope and

effect of Section 225 of the Madras Local Boards Act, 1920, did not deal with the bearing and construction of the words "" unless it is an action for

the recovery of immovable property or for a declaration of title thereto "" inserted in the section by an amendment of 1900.

As we read Section 170 of the Madras Panchayats Act, we find no difficulty in interpreting its scope as limited to suits for compensation as

mentioned therein The wide scope of "" any act "" is limited by the words which follow, namely, "" the amount of compensation claimed "" which

clearly indicate that the act contemplated is tortious in character. This is the interpretation which the predecessors of Section 170 had uniformly

received in this Court. But for The Panchayat Board Vs. The Western India Matches Company by Agent Henrik Hybbidnettee, . it would have

been necessary for us to notice the earlier cases. That case related to recovery of tax collected illegally. The learned Judges who made the

reference to the Full Bench had no doubt that the collection of the tax illegally was an act within the meaning of Section 225 of the Local Boards

Act, 1920. They referred, however, the question for decision of the Full Bench as to whether the suit was of such a nature as would fall within the

ambit of Section 225. The Full Bench held that the suit was not one for compensation and, therefore, was not within the ambit of Section 225. In

coming to that conclusion the Full Bench also pointed out that where the Courts had consistently interpreted the law in a particular way for many

years, it was for the Legislature and not the Courts to effect a change, if a change was desirable. This view of the section was adopted by one of us

in Krishnaswami v. Panchayal Board ILR (1965)Mad. 325, in construing sec-lion 107 of the Madras Village Panchayats Act, 1950, which is in

pari materia with Section 170 of the Madras Panchayats Act, 1958. In our view, the fact that Sub-section (2) of Section 170 saves from the scope

of Sub-section (1) ""providing for the recovery of immovable property or for a declaration of title thereto "" does not have the effect of enlarging the

scope of Sub-section (1) as to the nature of the suits contemplated by that provision. These words did not find a place in Section 156'' of the

Madras Local Board Act, 1884, but were inserted for the first time by The Amending Act VI of 1900 by recasting Section 150 and providing

Sub-section (3) of the section. But. these words, as we said, did not make any difference to the interpretation of the scope of Sub-section (1) of

Section 156 of the 1884 Act, as amended in 1900. Even as the section originally stood, which did not use the words '' the amount of

compensation claimed '', it had been interpreted as applicable to only tortious acts. The words "" the amount of compensation "" which, as we said,

were introduced in the section in 1900, have been reiterated in. the Act of 1920 as well as in the Panchayats Acts of 1950 and 1958. The point of

construction is really controlled by the use of these words "" the amount of compensation claimed,"" which unmistakably shows the nature or

character of the claim made in the suit.... One of us in Krishnaswami v. Panchayal Board ILR (1965)Mad. 325, made reference to Govindram

Saksrain v. Edward Rodbone ILR (1947) Bom. 860, where the Privy Council dealt with the word "" compensation "" and observed:

Compensation for an advantage may appear to be a contradiction in terms, since compensation connotes a measure of loss or damage and not the

value of an advantage. It would be, in our opinion, inappropriate to describe the plaint in. the instant case as one for compensation. The plaintiff

was certainly not suing for damages for any injury caused to him or compensation for any loss that he had sustained by reason of the order of

dismissal and restoration. The claim, as we read the plaint, was based on his service which no doubt was interrupted by the order. On a true view

of the plaint, it seems to us that the claim is one for salary for the period of his compulsory absence from service and not as compensation.

Our answer to the question referred to us is that Section 170 of the Madras Panchayats Act 1958, like Section 107 of the Madras Village

Panchayats Act, 1950, is applicable only to suits for compensation and that the words in Sub-section (2) of Section 170, "" unless it is a proceeding

for the recovery of immovable property or for a declaration, of title thereto "" do not make any difference to the interpretation.

This second appeal coming on for final hearing this day, the Court delivered the following judgment (Kailasam, J.) (6th January, 1970).

In view of the opinion of the Full Bench of this Court the second appeal is dismissed with costs.