Suhas Chandra Sen, J.
1. The petitioners in this case are Union of India, Coal India Limited and the Central Coal Fields Limited. The Respondent No. 3, Khas Karanpura Collieries Limited was the owner of a nationalised coal mine.
2. By virtue of Section 3 of the Coal Mines (Nationalisation) Act, 1973 the right, title and interest of the owners in relation to the coal mines specified in the Schedule to the Act stood transferred to and vested absolutely in the Central Government. The Act provided for payment to the owner of a coal mine the amounts specified in the Schedule to the Act (Section 5). A Commissioner of Payments was appointed for the purpose of disbursing the amounts specified in the Schedule to the owners (Section 17). Additional payment was to be made for the amount, as may become due to the owner of a coal mine in relation to the period during which the management 6f the coal mine remained vested in the Central Government (Section 18(2)). This provision became necessary in view of the fact that prior to nationalisation, the management of the coal mines had been taken over by the Central Government on and from 30th January, 1973. Under the Nationalisation Act, the Central Government or the Government Company was required to prepare a statement of account in respect of the period of management by the Central Government before vesting. It was specifically provided that a copy of the statement of account had to be forwarded to the Commissioner and also to the owner. The statement of account had to be audited by an Auditor and the audit of the account had to be conducted in such manner as the Central Government might direct (Section 19).
3. Under Section 20 all claims against the owner of a coal-mine have to be preferred before the Commissioner. Section 21 provides for priority of certain claims on account of provident fund, pension, gratuity etc. Section 22 provides for priority in relation to certain other claims. Section 23 lays down the procedure for admission and/or rejection of claims by the Commissioner. It requires every claimant to file proof of its claim with the Commissioner within the specified time. Section 23(4) is important for our purpose : --
"23(4). The Commissioner shall, after such investigation as may, in his opinion, be necessary and after giving the owner of the coal mine an opportunity of refuting the claim and after giving the claimant a reasonable opportunity of being heard, in writing, admit or reject the claim in whole or in part."
4. Section 23(5) provides that the Commissioner shall have the power to regulate his own procedure and for the purpose of investigation shall have all the powers of a Civil Court under the Code of Civil Procedure while trying a suit including the discovery and production of any document or other material object producible as evidence. There is a provision for appeal against a decision of the Commissioner under Section 23(7). Section 24 provides for payment of the balance amount to the owners after meeting all other claims which have been proved and/or admitted.
5. Section 25 provides that every amount advanced by the Central Government for the management of a coal mine during the period in which it was managed by the Central Government "shall be recovered from the income derived from the transactions which took place at any time after the commencement of the Coal Mines (Taking Over of Management) Act, 1973 but before the appointed day notwithstanding that such income was derived after the appointed day".
6. In this case, the petitioners filed an application on 30th December, 1975 before the Commissioner of Payments claiming a sum of Rs. 7,50,035.64 P. with interest under Section 25 of the Act. After the accounts were audited by the statutory auditors, an application for amendment was filed for amending the claim to Rs. 10,58,521.14 P. It is the case of the petitioners that on or about 28th July, 1977 copies of the audited accounts were served upon the respondent No. 3, the owner, and the Commissioner of Payments.
7. An objection petition was filed by the owners contesting the claims of the petitioners and after various proceedings, the claim case was transferred to Calcutta and was taken up for hearing on 22nd November, 1983. Hearing took place from time to time and on 10th January, 1984 the owners prayed for a direction for production of books of accounts and other records enclosing a statement of reasons for the prayer and also for inspection and verification of the books. The Commissioner of Payments overruling all objections raised by the writ petitioners allowed the prayer and directed the inspection to be given of all the books and documents as prayed by the owners in their application dated 24th April, 1979. The petitioners' grievance is against the aforesaid direction. The case of the petitioners is that since the accounts are statutorily required to be audited, there is no scope for any inspection or verification of the accounts. The accounts have to be prepared statutorily and audited by the statutory auditors. The contention of the petitioners is that, such audited accounts are binding upon the parties to the dispute.
8. I am unable to accept this contention. The Act has not made the audited accounts conclusive and binding upon the parties as well as the Commissioner. The claim that is lodged by the Central Government under Section 25 has to be investigated like any other claim by the Commissioner. Mr. Gupta is right in his contention that the Central Government is entitled to prove its case in the manner that it thinks fit. But that cannot mean that whatever evidence is produced will have to be accepted without cross-examination or documents will have to be accepted without investigation. If the petitioners rely upon the statement of account, the owner is entitled in law to question the correctness of the accounts. The statement of account cannot be checked except by reference to the books of account. Section 25 provides :
"25. Amounts advanced by the Central Government how to be recovered. -- Every amount advanced by the Central Government or the Custodian, as the case may be, for the management of a coal mine during the period in which the management of such coal mine remained vested in the Central Government, shall be recovered from the income derived from the transactions which took place at any time after the commencement of the Coal Mines (Taking Over of Management) Act, 1973, but before the appointed day notwithstanding that such income was derived after the appointed day :
Provided that where such income is insufficient to meet in full the total amount of the advance made by the Central Government or the Custodian for the management of the coal mine, the Central Government may make a claim to the Commissioner for the deficiency and thereupon the claim in respect of such deficiency shall have priority over the claims of all other unsecured creditors of the coal mine including those referred to in subsection (2) of Section
9. It was argued that if the income of the undertaking was sufficiently large, the Central Government could adjust the loans given by it against the income. The owner had not been given any right to intervene in this matter. But if the income was insufficient for setting off the loan, a claim had to be lodged with the Commissioner. If in the first case the accounts could not be challenged by the owner, on principle, it could not be challenged in the second case.
10. I am unable to uphold this contention. The Central Government during the period of its management may advance money for running the coal mining business. The Act authorises the Central Government to retain the amount of loan given by it from the profit made by the colliery during the period of management by the Government. If the Central Government retains more than its due, the owner will be entitled to take appropriate legal steps in the matter. If the accounts have not been properly prepared, it will be open to the owner to challenge the accounts before a Court of Law in spite of the certificate given by the Auditor. But when sufficient income has not been earned during the Government management, the Central Government has to make a claim before the Commissioner for recovery of the loan. To the extent the claim is accepted, the fund in the hand of the Commissioner will be depleted. The owner is entitled to claim only the balance left in the hand of the Commissioner after meeting various claims mentioned in the Act. That is why Section 23(3) requires the Commissioner to give an opportunity to the owner to refute the claim made by any party. In this case, the Central Government has made a claim on account of advances made by it in course of its management of the colliery. In proof of its claim, it has produced the audited statement of account. The primary books of account or the accounts that are maintained day to day have not been produced. Section 65 of the Evidence Act recognises the principle that when the originals consist of numerous accounts, evidence may be given as to the general result of the documents by any person who has examined them and who is skilled in the examination of such documents.
11. But even then the owner will be entitled to refute the claim made by the Central Government. The owner is entitled to disprove the claim made by the Central Government. In this case, the documents are in possession of the Central Government. The statement of account is nothing but an abstract prepared from the primary documents on which reliance is being placed by the Central Government. If the party is relying on an abstract or summary of the accounts, I fail to see how it can refuse to give inspection of the accounts from which the summary was prepared. It is true that an order for inspection should not be made as a -matter of course. But I am unable to hold in this case that the discretion was improperly exercised. The correctness of the accounts can only be tested by referring to the primary books from which the statement of account has been prepared.
12. In my opinion, the Nationalisation Act has not placed the audited statement of account beyond the scrutiny of the Commissioner. The claim of the Central Government will have to be proved like any other claim before the Commissioner. The Commissioner has been specifically empowered to investigate any claim made before him. He has got the power to admit the claim or to reject the claim. He has the power to regulate his own procedure and he has been vested with the powers of a Civil Court under the Code of Civil Procedure while trying a suit. Specifically he has been empowered to order discovery and production of any documents or other material object producible as evidence. A claimant, who is dissatisfied with the decision of the Commissioner, may prefer an appeal. This goes to show that the proceeding before the Commissioner must be of a quasi-judicial nature.
13. Under the circumstances, it is very difficult to hold that the Commissioner did not have any power to order discovery and production of the documents. The order that was passed was not without jurisdiction. It has also not been shown that the jurisdiction was exercised erroneously in the facts of this case.
14. It has to be borne in mind in this case that the Auditor has made several adverse comments in his report on the way the accounts have been maintained. It has been stated in the Auditor's report specifically that no records were available for quantity and value of opening stock of stores as on 30-1-1973 and the closing stock as on 30-4-1973. Adverse remarks made by the Auditor may or may not have any bearing on the issue raised before the Tribunal. But the owner's contention that accounts have to he examined to see whether the statement was properly prepared or not cannot he brushed aside.
15. My attention was drawn to an unreported judgment of the Madhya Pradesh High Court in the case of Newton Chickli Collieries Ltd. v. Union of India, Civil Revn. No. 1417 of 1980. In that case, the Central Government had made a claim under Section 25 of the Act and the ex-owner had refuted the claim. The Central Government had produced the cash books of the Central Office and also the Colliery Office. The Commissioner wanted details of the amount advanced by the Central Government. But no such statement was furnished. The case was disposed of by rejecting the claim of the Central Government without allowing adjournment of the case as was prayed for by the Central Government. On appeal the District Judge expressed the opinion that the Commissioner ought to have framed issues, called for production, admission and denial of documents and then given an opportunity to the parties to lead evidence. This procedure not having been followed, the District Judge remanded the case back to the Commissioner. A revision petition was filed against the order of remand which was ultimately dismissed by C. P. Sen, J. on 1-7-1981.
In that case, it was held : --
"The District Judge did not act illegally or with material irregularity in remanding the -case and directing the Asst. Commissioner to frame issues looking to the nature of the dispute, call for discovery and admission of documents and then given an opportunity to the parties to lead evidence. There is nothing wrong with such direction."
16. In that case, the primary books of the Central Office and the Colliery Office were produced and that was recorded in the judgment. In the instant case, apart from the statement of account, nothing else has been produced. Mr. Gupta is right in his contention -that the Government cannot possibly prove every entry in its regularly maintained books of account to prove its claim. But that is not the issue here. The Government has relied on a statement of account. The owner wants to inspect the accounts. The owner has a right to refute the claim and for that purpose it may pray for an inspection of the accounts on the basis of which the statement of claim has been prepared.
17. In my opinion, whether an order of inspection should be made or not is a matter of discretion of the authority which is hearing the case. In my view, it has not been shown that the discretion has been irregularly or improperly exercised. Therefore, I am not inclined to intervene in this matter at this stage.
18. The writ petition, therefore, fails and is dismissed. The interim order is vacated.
19. There will be no order as to costs.