The main legal point established is that the Government is not liable for the actions of its servants when they are exercising statutory powers, and liability under statute is limited to actions that benefit the Government or are ratified by the Government.

Spencer, J.

1. The plaintiff in this suit was the owner of two motor buses called "The Republic" and "The Albion" which plied between Ellore and Chintalapudi. He instituted this suit against the Secretary of State for India represented by the Collector of Kistna for unliquidated damages caused to him by the improper cancellation of his licence. Under the Madras Motor Vehicles Rules, which have the force of law, the District Magistrate is vested by Rule 30 with the power of issuing permits in Form G for motor vehicles which are intended to be let or plied for hire outside the City of Madras. One of the conditions in Form G is that the owner of the vehicle, if it be a motor bus, shall arrange for its examination once in every six months by a person approved by the District Magistrate. It appears that the District Magistrate cancelled the licence for the bus "The Republic" because it was not examined by the District Board Engineer as required by the permit. It was found by the Judge in the Lower Court that the District Board Engineer was a little negligent in not inspecting the car when it was produced for inspection. Assuming, however, that the District Magistrate committed an error of judgment in cancelling the licence and that the blame for the bus not being examined as required by the conditions of the permit lay more with the Engineer than with the plaintiff, the question for our decision is whether the Government is on that account liable for damages. The District Magistrate, both in issuing the licence and in cancelling it, was acting in pursuance of a statutory authority vested in him. In such a case it was held in Shivabhajan v. Secretary of State for India (1904) I.L.R. 28 B 314, and Ross v. Secretary of State for India (1915) I.L.R. 39 M 781 : 29 ML J 280, that Government was not liable for the conduct of its servants. Sadasiva Aiyar, J., in the latter decision, pointed out that the Crown could not be made liable for the action of a Government servant purporting to act under a statutory power conferred upon him, because his action when he purports to exercise a statutory power is not as agent of the Crown and he quotes the leading case of Tobin v. The Queen (1864) 33 L J C P 199 at 210. In Shivabhajan v. Secretary of Slate for India (1904) I.L.R. 28 B 314 a chief constable seized goods in pursuance of a statutory power vested in him under Section 550 of the Criminal Procedure Code.The goods being perishable were not forthcoming when the plaintiff demanded them. The learned Judges referred to the liability under Statute 21 and 22 Vict., c. 106 which now are represented by the Government of India Act, Section 32. In that case, as in the present case, it could not be contended that the act of the chief constable was in any sense productive of benefit to the revenues of the Government, nor was it a transaction out of which profit could be derived, and the Government had not ratified or adopted the act. In the present case the Government derived no profit by the cancellation of the licence. This case does not resemble the case in Wasappa v. Secretary of Stale for India (1915) I.L.R. 40 B 200, where the Government retained the proceeds of the sale of property which rightfully belonged to the plaintiff. Nor is it like the case in Mothi Rungaya Chetti v. Secretary of State for India in Council (1904) I.L.R. 28 M 213 : 15 M L J 226, where the Post Office were held liable as carriers of value payable parcels when they delivered a parcel without obtaining payment from the consignee and remitting the value to the sender. Vijaya Ragova v. Secretary of State for India (1884) I.L.R. 7 M 466 (FB) was an instance where the Government removed a Municipal Commissioner for misconduct. The act which the Judges treated as a tort was an act of the Government itself and not of one of its servants. The soundness of the decision has been doubted. Katlash Chandra Nag v. Secretary of Stale for India (1912) I.L.R. 40 C 452 was a case where