2006 Supreme(SC) 465

2006(4) Supreme 378
SUPREME COURT OF INDIA
(Under Art. 32 of the Constitution of India)
Y.K. Sabharwal, CJI., C.K. Thakker and R.V. Raveendran, JJ.
Jaya Bachchan—Petitioner
versus
Union of India & Ors.—Respondents
Writ Petition (Civil) No. 199 of 2006
Decided on 8-5-2006
Counsel for the Parties :
For the Appellant : F.S. Nariman, Sr. Advocate, Ejaz Maqbool, Pradeep Kumar Rai, Rohit Mammen Alex, Vikas Singh, Taruna Singh, Abhijit Sinha, Advocates.
For the Respondent : S.N. Shukla, S.K. Rungta, Sushil Kumar Jain, A.P. Dhamija, Sarad Singhania, Pratibha Jain, Advocates.

IMPORTANT POINT
Where the office carries with it certain emoluments or the order of appointment states that the person appointed is entitled to certain emoluments, then it will be an office of profit, even if the holder of the office chooses not to receive/draw such emoluments, what is relevant is whether pecuniary gain is ‘receivable’ in regard to the office and not whether pecuniary gain is, in fact, received or received negligibly.

Headnote:Constitution of India—Articles 102(1)(a) and 103—Parliament (Prevention of Disqualification) Act, 1959—Section 3—Order disqualifying petitioner as member of Rajya Sabha on and from 14th July 2004 as holding office of profit on her appointment by Govt. of Uttar Pradesh as Chairperson of the U.P. Film Development Council—Election Commission in its report to President of India opined that office to which petitioner was appointed by State Govt. on the terms and conditions specified therein was an “office of profit”—Writ challenging order on plea that in absence of any finding by Election Commission that petitioner received any payment or monetary consideration from State Govt., she could not be said to hold office of profit—Council was not an autonomous body or statutory corporation and all its expenses were met by the Dept. of State Govt.—Term “holds office of profit” was required to be interpreted in a realistic manner—Payment of honorarium, daily allowance in nature of compensatory allowance, rent free accommodation and chauffeur driven car at State expense were in nature of remuneration hence constituted profit—If pecuniary gain was “receivable” it would be an office of profit irrespective of whether such pecuniary gain was actually received or not.

       Held : It is not in dispute that the Council is not an autonomous body or statutory Corporation, that the Council has no budget of its own, and that all its expenses are met by the Department of the State Government administratively in-charge of it. Similarly, the fact that the petitioner was appointed as Chairperson of the Council, conferring on her the rank of a Cabinet Minister entitling her to all the remuneration and benefits as provided in the O.M. dated 22.3.1991 (extracted above), is also not disputed. Clause (1)(a) of Article 102 provides that a person shall be disqualified for being chosen as, and for being, a member of either House of Parliament if he holds any office of profit under the Government of India or the Government of any State, other than an office declared by Parliament by law not to disqualify its holder. The term ‘holds an office of profit’ though not defined, has been the subject matter of interpretation, in several decisions of this Court. An office of profit is an office which is capable of yielding a profit or pecuniary gain. Holding an office under the Central or State Government, to which some pay, salary, emolument, remuneration or non-compensatory allowance is attached, is ‘holding an office of profit’. The question whether a person holds an office of profit is required to be interpreted in a realistic manner. Nature of the payment must be considered as a matter of substance rather than of form. Nomenclature is not important. In fact, mere use of the word ‘honorarium’ cannot take the payment out of the payment out of the purview of profit, if there is pecuniary gain for the recipient. Payment of honorarium, in addition to daily allowances in the nature of compensatory allowances, rent free accommodation and chauffeur driven car at State expense, are clearly in the nature of remuneration and a source of pecuniary gain and hence constitute profit. For deciding the question as to whether one is holding an office of profit or not, what is relevant is whether the office is capable of yielding a profit or pecuniary gain and not whether the person actually obtained a monetary gain. If the “pecuniary gain” is “receivable” in connection with the office then it becomes an office of profit, irrespective of whether such pecuniary gain is actually received or not. If the office carries with it, or entitles the holder to, any pecuniary gain other than reimbursement of out of pocket/actual expenses, then the office will be an office of profit for the purpose of Article 102(1)(a).(Paras 5 & 6)

       It is well settled that where the office carries with it certain emoluments or the order of appointment states that the person appointed is entitled to certain emoluments, then it will be an office of profit, even if the holder of the office choose not to receive/draw such emoluments. What is relevant is whether pecuniary gain is “receivable” in regard to the office and not whether pecuniary gain is, in fact, received or received negligibly. In this case, as noticed above, the office carried with it a monthly honorarium of Rs. 5000/-, entertainment expenditure of Rs. 10,000/-, staff car with driver, telephones at office and residence, free accommodation and medical treatment facilities to self and family members, apart from other allowances etc. That these are pecuniary gains, cannot be denied. The fact that the petitioner is affluent or was not interested in the benefits/facilities given by the State Government or did not, in fact, receive such benefits till date, are not relevant to the issue. In this view, the question whether petitioner actually received any pecuniary gain or not is of no consequence.(Paras 11 to 13)

       (ii) WORDS AND PHRASES—Holding an office of profit—Meaning—Held, an office of profit is an office which is capable of yielding a profit or pecuniary gain—Holding an office under the Central or State Government, to which some pay, salary, emolument, remuneration or non compensatory allowance is attached, is ‘holding an office of profit’.