Constitution is what the Judges say it is

SUPREME COURT OF INDIA JUDGMENTS

The Constitution is what the Judges say it is. That is because the power to interpret the Constitution vests in the Judges. A heavy responsibility lies on the Judges when they are called upon to interpret the Constitution, the responsibility is all the more heavier when the provisions to be construed relate to the powers of the judiciary. It is essential that complete objectivity is maintained while interpreting the Constitutional provisions relating to the power of the judiciary vis-a-vis the executive in the matter of appointments to the superior judiciary to avoid any feeling amongst the other constitutional functionaries that there has been usurpation of power through the process of interpretation. This is not to say that the judiciary should be unduly concerned about such criticism but merely to emphasize that the responsibility is greater in such cases. To put it differently where the language of the Constitution is plain and the words used are not ambiguous, care should be taken to avoid giving an impression that fancied ambiguities have been conjured with a view to making it possible to place a convenient construction on the provisions. If the words are plain and unambiguous effect must be given to them, for that is the constituent body’s intent, whether you like it or not, and any seeming attempt to depart therefrom under the guise of interpretation of imaginary ambiguities would cast a serious doubt on the credibility and impartiality of the judiciary. It would seem as if judges have departed from their sworn duty; any such feeling would rudely shock peoples’ confidence and shake the very foundation on which the judicial edifice stands.

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Repugnacy test of

It is trite law that the plea of repugnancy would be attracted only if both the legislations fall under the Concurrent List of the Seventh Schedule of the Constitution. Under Article 254 of the Constitution, a State law passed in respect of a subject matter comprised in List III i.e. the Concurrent List of the Seventh Schedule of the Constitution would be invalid if its provisions are repugnant to a law passed on the same subject by the Parliament and that too only in a situation if both the laws i.e. one made by the State legislature and another made by the Parliament cannot exist together. In other words, the question of repugnancy under Article 254 of the Constitution arises when the provisions of both laws are completely inconsistent with each other or when the provisions of both laws are absolutely irreconcilable with each other and it is impossible without disturbing the other provision, or conflicting interpretations resulted into, when both the statutes covering the same field are applied to a given set of facts. That is to say, in simple words, repugnancy between the two statutes would arise if there is a direct conflict between the two provisions and the law made by the Parliament and the law made by the State Legislature occupies the same field. Hence, whenever the issue of repugnancy between the law passed by the Parliament and of State legislature are raised, it becomes quite necessary to examine as to whether the two legislations cover or relate to the same subject matter or different.

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40 Descriptive questions on Constitutional Law of India

HIGHER JUDICIAL SERVICE EXAMINATION
  1. How far the Independence of Judiciary is ensured under the Constitution of India ?
  2. What are the requirements of a just legal system?
  3. Explain ideal judicial behaviour.
  4. The new dimension of ‘Right to Life – elaborate with case laws.
  5. While referring to relevant Constitutional provisions and case law discuss the evolution, nature and content of the right to safe and decent environment in India.
  6. In the light of the decision of the Supreme Court in Keshavnand Bharati V. State of Kerala, examine the Amending Power of the Parliament provided under Article 368 of the Constitution of India.
  7. The Supreme Court of India’s decision in T.N. Seshan V. Union of India has brought out a new approach towards the functioning of Election Commission of India.’ – Comment.
  8. Examine the distribution of legislative powers between the Union and the States ensured under the Constitution of India.
  9. On what grounds judicial review of administrative action can be exercised ? What are the conditions for the grant of quo-warranto by the court ?
  10. Explain the doctrine of ‘bias’ with the help of decided cases.
  11. Explain the ‘Doctrine of precedent’ as developed by Indian Judiciary.
  12. Explain the doctrine ‘Nemo Debet-Proeadem Causa bis Vexari.’
  13. While referring to provisions of the Forest Conservation Act and the relevant case law critically examine the role of the apex judiciary in the development of forest jurisprudence in India.
  14. Explain the doctrine of Eclipse.
  15. How far ‘Lie Detector Test’ is constitutionally permissible?
  16. Doctrine of Stare-decisis in India and its relevance in applying foreign judgments in India.
  17. Explain Judicial control of administrative discretion.
  18. Judicial Review of Administrative discretion.
  19. Explain the notion of ‘error apparent on the face of the record.
  20. ‘All the theories of juristic personality are so close to each other that they lead to lot of confusion.’ Comment on the light of Ram Janmobhumi case.
  21. The protection given under the Constitution of India against Arbitrary Arrest & Detention.
  22. ‘The Constitution has ensured certain rights to the Minorities under Article 30.’ –Examine.
  23. How far the ‘Fundamental Rights’ and the ‘Directive Principles of State Policy’ are interrelated to ensure constitutional objectives.
  24. The fundamental principle of Criminal Justice system is that ‘No person shall be prosecuted and punished for the same offence more than once’. – Comment.
  25. In the light of the decision of the Supreme Court in D.C. Wadhwa v. State of Bihar, examine the ordinance making power of the Governor under the Constitution of India.
  26. What are the controls on the abuse of administrative discretion in India.
  27. Explain the content and scope of ‘Expost Facto Laws’ under the Constitution of India.
  28. Discuss the meaning of ‘Refugee’ and distinguish it from Stateless persons.
  29. The content and scope of ‘Obiter dicta’.
  30. Discuss vicarious liability of the State.
  31. Legal aspects of Sustainable Development.
  32. The Supreme Court of India is also called as ‘A Court of Record.’ – Discuss.
  33. Secularism is the foundation of democracy- Explain
  34. Legal status of precautionary principle in India.
  35. Doctrine of Indoor Management-Explain
  36. Briefly discuss about the privileges and immunities given to the Parliament and its members.
  37. Examine the Jurisdiction of the Supreme Court with special reference to ‘Appellate Jurisdiction’.
  38. Explain the doctrine of Ultra Vires with the help of decided cases.
  39. Examine the constitutional validity of ‘the Narco Analysis Test’ in the light of Right against self incrimination.
  40. Explain the notion of ‘reasoned decisions’.

Introduction to the Study of the Law of the Constitution: Albert Venn Dicey [1915]

Albert Venn Dicey, Introduction to the Study of the Law of the Constitution [1915]

 Table of Contents:

 

  • CONTENTS
  • I
  • II
  • PREFACE TO THE FIRST EDITION
  • PREFACE TO THE EIGHTH EDITION
  • INTRODUCTION
  • AIM
  • SOVEREIGNTY OF PARLIAMENT
  • POSSIBLE CHANGE IN CONSTITUTION OR CHARACTER OF THE PARLIAMENTARY SOVEREIGN (EFFECT OF THE PARLIAMENT ACT, 1911)
  • THE STATE OF THINGS IMMEDIATELY BEFORE THE PASSING OF THE PARLIAMENT ACT
  • THE DIRECT EFFECTS OF THE PARLIAMENT ACT
  • PRACTICAL CHANGE IN THE AREA OF PARLIAMENTARY SOVEREIGNTY (RELATION OF THE IMPERIAL PARLIAMENT TO THE DOMINIONS)
  • First Question
  • Rule 1
  • Rule 2
  • Rule 3
  • Rule 4
  • Second Question
  • THE RULE OF LAW
  • DECLINE IN REVERENCE FOR RULE OF LAW
  • Legislation
  • Distrust of Judges and of Courts
  • Lawlessness
  • COMPARISON BETWEEN THE PRESENT OFFICIAL LAW OF ENGLAND AND THE PRESENT DROIT ADMINISTRATIF OF FRANCE
  • CONVENTIONS OF THE CONSTITUTION
  • FIRST QUESTION
  • ANSWER
  • MERE CONVENTIONS
  • ENACTED CONVENTIONS
  • SECOND QUESTION
  • ANSWER
  • THIRD QUESTION
  • ANSWER
  • DEVELOPMENT DURING THE LAST THIRTY YEARS OF NEW CONSTITUTIONAL IDEAS
  • TWO GENERAL OBSERVATIONS
  • First Observation
  • Second Observation
  • CRITICISM OF EACH OF THE FOUR NEW CONSTITUTIONAL IDEAS
  • Woman Suffrage
  • The Causes
  • The Main Lines of Argument
  • First Argument
  • Answer
  • Second Argument
  • Answer
  • Proportional Representation
  • First Proposition
  • Second Proposition
  • Third Proposition
  • Objections to the Third Proposition
  • Second Objection
  • Third Objection
  • Federalism
  • Leading Characteristics of Federal Government
  • The Characteristics of Federal Government in Relation to Imperial Federalism
  • Characteristics of Federal Government in Relation to Home Rule All Round
  • The Referendum
  • The Causes
  • The Main Argument Against the Referendum
  • The Main Argument in Favour of the Referendum
  • CONCLUSIONS
  • OUTLINE OF SUBJECT
  • THE TRUE NATURE OF CONSTITUTIONAL LAW
  • PART I: THE SOVEREIGNTY OF PARLIAMENT
    • Chapter I: THE NATURE OF PARLIAMENTARY SOVEREIGNTY
    • NATURE OF PARLIAMENTARY SOVEREIGNTY
    • Unlimited Legislative Authority of Parliament
    • The Absence of Any Competing Legislative Power
    • ALLEGED LEGAL LIMITATIONS ON THE LEGISLATIVE SOVEREIGNTY OF PARLIAMENT
    • DIFFICULTIES AS TO THE DOCTRINE OF PARLIAMENTARY SOVEREIGNTY
    • Chapter II: PARLIAMENT AND NON-SOVEREIGN LAW-MAKING BODIES
    • CHARACTERISTICS OF SOVEREIGN PARLIAMENT
    • CHARACTERISTICS OF NON-SOVEREIGN LAW-MAKING BODIES
    • Subordinate Law-making Bodies
    • Foreign Non-sovereign Legislatures
    • Chapter III: PARLIAMENTARY SOVEREIGNTY AND FEDERALISM
  • PART II: THE RULE OF LAW
    • Chapter IV: THE RULE OF LAW: ITS NATURE AND GENERAL APPLICATIONS
    • Chapter V: THE RIGHT TO PERSONAL FREEDOM
    • REDRESS FOR ARREST
    • WRIT OF HABEAS CORPUS
    • Nature of Writ
    • The Habeas Corpus Acts
    • Suspension of the Habeas Corpus Act
    • An Act of Indemnity
    • Chapter VI: THE RIGHT TO FREEDOM OF DISCUSSION
    • Chapter VII: THE RIGHT OF PUBLIC MEETING1
    • FIRST LIMITATION
    • SECOND LIMITATION
    • Chapter VIII: MARTIAL LAW
    • Chapter IX: THE ARMY
    • THE STANDING ARMY
    • A SOLDIER’S POSITION AS A CITIZEN
    • A SOLDIER’S POSITION AS A MEMBER OF THE ARMY
    • THE TERRITORIAL FORCE
    • Chapter X: THE REVENUE1
    • SOURCE OF PUBLIC REVENUE
    • AUTHORITY FOR EXPENDING REVENUE
    • SECURITY FOR THE PROPER APPROPRIATION OF THE REVENUE
    • Chapter XI: THE RESPONSIBILITY OF MINISTERS
    • Chapter XII: RULE OF LAW COMPARED WITH DROIT ADMINISTRATIF
    • FIRST PERIOD: NAPOLEON AND THE RESTORATION, 1800–1830
    • SECOND PERIOD: THE ORLEANS MONARCHY AND THE SECOND EMPIRE 1830–187030
    • THIRD PERIOD: THE THIRD REPUBLIC, 1870–1908
    • The Period of Unnoticed Growth, 1800–18 (Période D’élaboration Secréte)
    • The Period of Publication, 1818–60 (Période de Divulgation)
    • The Period of Organisation, 1860–1908 (Période d’Organisation)
    • Chapter XIII: RELATION BETWEEN PARLIAMENTARY SOVEREIGNTY AND THE RULE OF LAW
  • PART III: THE CONNECTION BETWEEN THE LAW OF THE CONSTITUTION AND THE CONVENTIONS OF THE CONSTITUTION
    • Chapter XIV: NATURE OF CONVENTIONS OF CONSTITUTION
    • Chapter XV: THE SANCTION BY WHICH THE CONVENTIONS OF THE CONSTITUTION ARE ENFORCED

 

  • APPENDIX
  • Note I: RIGIDITY OF FRENCH CONSTITUTIONS
  • Note II: DIVISION OF POWERS IN FEDERAL STATES
  • THE UNITED STATES
  • THE SWISS CONFEDERATION
  • THE CANADIAN DOMINION
  • THE COMMONWEALTH OF AUSTRALIA
  • THE GERMAN EMPIRE
  • Note III: DISTINCTION BETWEEN A PARUAMENTARY EXECUTIVE AND A NON-PARLIAMENTARY EXECUTIVE
  • Note IV: THE RIGHT OF SELF-DEFENCE
  • FIRST THEORY
  • SECOND THEORY
  • Note V: QUESTIONS CONNECTED WITH THE RIGHT OF PUBLIC MEETING
  • DOES THERE EXIST ANY GENERAL RIGHT OF MEETING IN PUBLIC PLACES?
  • WHAT IS THE MEANING OF THE TERM “AN UNLAWFUL ASSEMBLY”?
  • WHAT ARE THE RIGHTS OF THE CROWN OR ITS SERVANTS IN DEALING WITH AN UNLAWFUL ASSEMBLY?
  • WHAT ARE THE RIGHTS POSSESSED BY THE MEMBERS OF A LAWFUL ASSEMBLY WHEN THE MEETING IS INTERFERED WITH OR DISPERSED BY FORCE?
  • Note VI: DUTY OF SOLDIERS CALLED UPON TO DISPERSE AN UNLAWFUL ASSEMBLY
  • Note VII: THE MEANING OF AN “UNCONSTITUTIONAL” LAW
  • Note VIII: SWISS FEDERALISM89
  • THE FEDERAL COUNCIL
  • THE FEDERAL ASSEMBLY
  • THE FEDERAL TRIBUNAL
  • THE REFERENDUM
  • Note IX: AUSTRALIAN FEDERALISM101
  • FEDERAL GOVERNMENT
  • THE PARLIAMENTARY EXECUTIVE
  • AMENDMENT OF THE CONSTITUTION
  • MAINTENANCE OF THE RELATION WITH THE UNITED KINGDOM
  • Note X: MARTIAL LAW IN ENGLAND DURING TIME OF WAR OR INSURRECTION121
  • NATURE OF MARTIAL LAW
  • CONCLUSIONS
  • OTHER DOCTRINES WITH REGARD TO MARTIAL LAW
  • The Doctrine of the Prerogative
  • The Doctrine of Immunity
  • The Doctrine of Political Necessity or Expediency154
  • Note XI: CONSTITUTION OF THE TRIBUNAL DES CONFLITS
  • Note XII: PROCEEDINGS AGAINST THE CROWN
  • AS TO BREACH OF CONTRACT
  • AS TO WRONGS
  • Note XIII: PARLIAMENT ACT, 1911 [I & 2 Geo. 5. Ch. Ch. 13.]

 

  • INDEX

Freedom of Speech and Crime of Seditious Libel

Freedom

Freedom of Speech

Where a law purports to authorise imposition of restrictions on a fundamental right of language wide enough to cover restrictions both within and without the limits of constitutionality

Constitutional Mechanism: liberty of the press

The Constitution of India contains no express declaration in favour of the freedom or liberty of the press, and the reason or one of the reasons for this omission may, I imagine, be that in no period in history and in no country in the world has the press been free, in the sense that the keeper of a press may print and publish any matter he chooses without thereby incurring any risk of punishment. The invention of printing led to the propagation and dissemination, on a far wider scale than had hitherto been possible, of ideas which were subversive of the existing order in Church and State. In 1501 Pope Alexander VI published a bill against unlicensed printing. After the Reformation and the break up of the Holy Roman Empire, the sovereigns of the national states which came into existence, took similar steps to control the press. In England, until 1695 no book or pamphlet could be printed without the imprimatur of the Crown licensor, and the printers and authors of books or pamphlets, which had been issued without it, were liable to be brought before special Court such as the Star Chamber, and most severely punished. Although in 1695, when the House of Commons declined to continue the Licensing Act, the press in England was emancipated from direct state control, in other countries on the Continent of Europe a system of pre-censorship continued until long afterward. In 20th century Europe, in more than one country, the press, on its political side at least, has again been subjected to strict Government control. In Fascist Italy, the responsible editor of every newspaper had to be approved by the prefect of the province. A prefect might warn a newspaper editor who published matter or news to which he took exception and might revoke his recognition of an editor who had been so warned twice in a year. In Soviet Russia, there is no independent press, and any person venturing to propagate ideas, which are, in any way, inconsistent with the communist creed, are liable to the most severe punishment. When we speak of the freedom or liberty of the press, we mean that freedom no doubt a very substantial freedom but nevertheless, a freedom which is definitely limited and circumscribed which is enjoyed by the press in the English speaking world.

In 1784 in the celebrated case of Rex v. Dean of St. Asaph (1784) 3 C T. R. 431 Lord Mansfield said:

The liberty of the press consists in printing without any previous license subject to the consequences of the law.

Now, in England and in America, it is a crime to print and publish matter of certain kinds. It is obvious that the existence of such laws and the consequent dread of punishment must act as a deterrent on persons, who hold certain ideas or opinions, seeking to propagate and disseminate them. Moreover under the law of libel, including the law of seditious libel, not merely is the author of the libel responsible. Responsibility also extends to the publisher and printer and, indeed to every vendor of the publication. As ordinarily, a writer must find a publisher, the publisher must employ a printer, and the printer, in his turn must rely on booksellers to sell the book or pamphlet which he prints, it is clear that the possibility of a writer succeeding in communicating to any large body of the public ideas or opinions the dissemination of which the law regards as culpable is small.

In India, until 1910 the press was in very much the same position as it was in Great Britain and the Dominions and in America. In 1910 the Press Act, however, empowered the executive to demand security from the keeper of a press and the publisher of a newspaper, and in certain circumstances, to declare such security forfeited. The Press Act of 1910 was repealed in 1922, but in 1931 was re-enacted in a modified form. The statute of 1981 was described as “An Act to provide against the publication of matter exciting to or encouraging murder or violence”. In the following year, it was amended in certain particulars by the Criminal Law Amendment Act, 1982, one such amendment being in the title which was altered to “an act to provide for the better control of the press”. The question that  could be raised whether, in consequence of Article 19(1)(a) in the Constitution, it is still open to the executive to require the keeper of a press, which has published matter of the kind referred to in certain Clauses of Press (Emergency Powers) Act, 1931, to deposit security. The subject of requiring security is, it is clear to ensure that the keeper of a press, who prints matter of a certain kind, may not evade liability or escape punishment. Such also, it may be observed, is the object of the law which requires the printer of every book or pamphlet to exhibit his name and address on the first or the last page of the book or pamphlet. In England, until the law so provided persons, who were labeled, very often found it a matter of the greatest difficulty to ascertain who was responsible, and in order to enable them to do so, general search warrants had to be issued. There can, of course, be no doubt that a system under which the keeper of a printing press can be required to deposit security is a system of control over the press, but the control so exercised is substantially the same kind of control as is exercised by making it a crime to publish matter of a certain kind. The author of the book or pamphlet, which contains or may appear to contain a libel on an individual or a seditious libel, will ordinarily find it difficult to get it printed which is what the law intends, and he may find it more difficult to get it printed by a printer who has been required to furnish security than by a printer who has not yet been required to do so, which again is what the law intends. Is there, however, in principle any objection to the exercise of this further measure of control by the State? Professor Dicey in his Law of Constitution, 8th Edn., p. 244, observes:

No sensible person will argue that to demand deposit from the owner of a newspaper or to impose other limitations upon the right of publishing periodicals is of necessity inexpedient or unjust.

A fortiori this observation applies to the keeper of a printing press, which publishes leaflets or pamphlets of the kind we are now concerned with. It is, and always has been, well settled both in England and in India that security may be taken from a person who has committed certain crimes or who, having committed a certain crime, is thought to be likely to commit that crime again. As will appear later, a person who publishes matter of the kind referred to in Clauses (a) and (b) of Section 4 (1), Press (Emergency Powers) Act, 1981, commits a crime. It is true that security is, in the first instance, demanded by the executive but against its order there is a right of appeal, and the appeal must be heard by a Bench of three High Court Judges. There is, in substance, in such a case at least no serious departure from what Professor Dicey calls the rule of law. It is also true that, in recent times, so far as I can ascertain, security has never in England been demanded from a printer. But security has, on occasion, been demanded from persons proposing to address public meetings, Wise v. Dunning (1902) 1 K. B. 167 : (71 L.J. K. B. 165). In other words, the taking of security has sometimes been used to fetter the expression of opinion.  Article 21 of the Constitution is so drawn as to preserve to the Courts the power to demand security under chap. VIII, Criminal P.C. Why should it be supposed that the Constituent Assembly intended that the practice of requiring the keeper of a printing press to deposit security in order to prevent the publication of seditious libels should cease-? In construing the relevant provisions of the constitution, it is, in my opinion, necessary to keep any such a priori assumption out of one’s mind. Indeed if any assumption at all is to be made, it ought, I think, to be an assumption the other way.

Constitutional Safeguard of freedom of speech and expression

Article 19(1)(a) of the Constitution provides that all citizens shall have the right to freedom of speech and expression. It is clear that the word “expression” is used by way of amplification of the word “speech” which immediately precedes it. Subject to what is contained in Article 19(2), Article 19(1)(a) renders Immune from punishment not merely the individual citizen who gives expression to his opinions in conversation or at a public meeting, but also to the journalist, the writer, the printer, the sculptor, the dramatist, and, in short, every kind of creative artist. The editor of a newspaper, who moulds or is in a position to mould public opinion, may perhaps come within the purview of the article, but in my opinion, the keeper of a printing press quite certainly, does not. Printing may sometimes be an art, but the generality of printers do not give expression to ideas and opinions of their own. They are merely engaged or employed by other persons to give a wider publicity, than could otherwise be achieved, to ideas and opinions of’ theirs. Indirectly, no doubt, the article may operate in such a way as to prevent certain restrictions being imposed on printers. It is, for instance, not open to Parliament to enact a law that, before printing any book or pamphlet, which be may have been employed to print, the printer shall submit it for pre-censorship. The reason, however, why such a law would now be an unconstitutional law is not that it imposes a restriction on the printer, but that, in substance, it is a restriction imposed on the writer or author. It is well known that the Constituent Assembly examined the constitutions of other countries. Now, there are constitutions in which not merely the right to speak, write and publish, but also the right to print is conferred on all citizens. An instance in point is Article 18 of the Belgium Constitution of 1832 which is reproduced in Dicey’s law of the Constitution, Edn. 8, p. 234, and the constitutions of some of the competent States in the United States of America (vide Cooley’s Constitutional Limitation, vol. 2, p. 876). I refer particularly to the Belgium Constitution of 1832 as, not only does it confer on every citizen the right to print, but also prohibits, the taking of security from the keeper of a printing press. It will be observed that, under it, the keeper of a printing press is immune from punishment if the author of the book or pamphlet, which he has printed, is a person who is known and who is domiciled in Belgium. So long as the keeper of a printing press takes the precaution of ascertaining who the author is and that he is domiciled in Belgium and can, in consequence be made liable for the publication of matter which offends against the law, the printer is no more responsible than is the colourman who supplies the canvas and paints with which an artist paints an obscene picture. The article appears to have been drawn in such a way as to enable writers and authors to obtain without any difficulty the services of a printer and so disseminate to the widest possible extent their opinions and ideas. In other words, the right conferred on printers was, in substance, a right conferred on writers and authors. As, however, I have already pointed out it is an integral part of the system of control, albeit indirect control over the press which obtains in the English speaking world that the printer shall be as much responsible at law as is the writer or authors I am unable to read into the word “expression” in Article 19(1)(a) any implied right in writers and authors to obtain the services of printers to enable them to reach the widest possible public. In other words, I can find nothing in the five words contained in this article which leads me inevitably to the conclusion that the power [to demand security from the keeper of a printing press is a power which the executive may no longer exercise.

If this is the correct interpretation of Article 19(1), there is an end of the matter. But if it is assumed , for the sake of argument, that the article does, in fact, confer on the keeper of a printing press a right to print whatever he may choose, and proceed to consider whether the taking of a deposit is not one of the restrictions which may be imposed on the exercise of this fundamental right under Article 19(2). It is clear that the principle object of the Constituent Assembly in enacting this article was to define the limits within which Parliament might, and beyond which Parliament might not, make the dissemination and propagation of ideas and opinions a crime. More particularly, the Constituent Assembly would seem to have restricted within narrower limits the crime, which is ordinarily known as the crime of seditious libel; and given to the citizens of India a right to criticise the Government, which is at least as ample as that enjoyed by the citizens of the United States of America and more ample than has ever been enjoyed by the citizens of Great Britain and the Dominions of the British Commonwealth, If, however, this had been the sole object of the Constituent Assembly, it would not have used the language which it did. The expression “law relating to libel” cannot possibly be construed as connoting nothing more than a law which makes libel punishable. If that were so the provisions of law which requires the name and address of the printer to appear on every book and pamphlet and requires the name of every editor, printer and publisher of a newspaper to appear on every copy of a newspaper would have ceased to be a valid law. For the reasons which I have already indicated, these provisions are part of the law relating to libel. By a parity of reasoning it must, I think, be concluded that the provisions contained in Section 4 (1)(a) and (b), Press (Emergency Powers) Act, 1931, which enable security to be demanded from the keeper of a printing press, are part of the law relating to seditious libel. In order to prevent any misunderstanding, I wish at this stage to point out that Clauses (e) to (i) in Section 4 (1) of the Act enable security to be demanded in a wide variety of circumstances. If the construction which I am myself disposed to put on Article 19(1) is wrong and if printers have a fundamental right to print any matter they may choose, it may well be that, in certain of these circumstances the demand for security can no longer be supported. But the narrow point which I have to decide here is whether security may be demanded from the keeper of a minting press who has published matter of the kind referred to in Clauses (a) and (b) which are severable from the other clauses. In construing these clauses, it is permissible and indeed necessary to employ the method of historical investigation.

Fundamental Right of Language

The Press Act of 1910 was enacted in order to combat terrorist or revolutionary crime. It was repealed in 1922, because such crime had become far less common. It was re-enacted in 1931, because there had been a recrudescence of such crime, and in the following year it was enlarged and modified in consequence of the non-co-operation movement. Although the promoters of this movement desired it to be peaceful and non-voilent movement, certain persons took advantage of it to commit a violent crime in order to effect a revolution and overthrow the existing system of Government. Bearing this in mind, it seems to me quite clear that Clause (a) of Section 4 (1) was aimed at political assassination and the commission of violent crimes intended to overthrow or weaken the State and that Clause (b) was aimed at those who glorified such crime and, more particularly preached the doctrine that in certain circumstances and in order to achieve certain ends, murder was no crime at all.  In the Queen v. Most (1881) 7 Q.B.d. 244 : (50 L.J. M. C. 113) one Johann Most was indicted for having published an article in a newspaper extolling the assassination of the Empress of Russia and holding it up as an example to revolutionaries throughout the world. Johann Most was tried and convicted for having published a seditious libel, but was also tried and convicted under 24 and 25 vict. caput 4, which made it an offence for persons to “conspire.,, confiderate and agree to murder any person” the reason being that the punishment provided for that crime was a more severe punishment than could be inflicted for the crime of seditious libel. It was contended that Johann Most could not be convicted as it was not shown that he had come into direct contact with any of the persons who read the newspaper and could not therefore, be said to have incited them. Much reliance could be placed on two decisions of the-Supreme Court Romesh Thappar Vs. The State of Madras, and Brij Bhushan and Another Vs. The State of Delhi. The orders, complained of in these cases were orders prohibiting the entry into or the circulation, sale or distribution in the State of Madras in the one case and in the State of Delhi in the other of two newspapers. In Ireland, front time to time power has ‘been conferred ore the executive to seize and destroy newspapers-or their publications containing seditious libels, A power of that kind is in effect a power of pro-censorship, and, under the Indian Constitution, cannot be conferred on the executive except in periods of emergency. The power conferred by the State of Madras and the State of Delhi, namely, a power to seize a certain newspaper,, whether it contained matter amounting to a seditious libel or not was a still wider power and one which is clearly prohibited by the Constitution. Pre-censorship and still more what done or authorised to be done in Madras and Delhi is a direct invasion of the fundamental right of the editor and journalist who used the columns of these newspapers to give expression to their opinions. What has been done here does not amount to an invasion of the fundamental right of the author of this pamphlet or leaflet. It is true that the press itself has been subjected to a further measure of control, but a control of exactly the same kind as is already imposed by the existence of a law which makes seditious libel a crime. If it is a restriction on any fundamental right possessed by the printer – and I do not myself think he has any it is a restriction permitted by Article 19(2). I” have read and re-read the judgments of the-Supreme Court, and I can find nothing in them myself which bears directly on the point at issue and leads me to think that, in their opinion, a restriction of this kind is no longer permissible. I do not think it necessary to refer to any of the observations of their Lordships except one which occurs towards the end of the judgment which I do mention. Sastri J., there said:

Where a law purports to authorise the imposition of restrictions on a fundamental right in language wide enough to cover restrictions both within and without the limits of constitutionally permissible legislative action affecting such right, it is not possible to uphold it even so far as it may be applied within the constitutional limits, as it is not severable.

The Constitution of India has the peculiarity that, instead, of leaving it to Parliament to examine the statute book and repeal any law which infringes on a fundamental right, it imposes on the Judiciary the duty of declaring that Jaw void. In discharging this onerous duty, the judiciary, ought to proceed with caution and circumspection. It ought not to declare an existing law to be void unless it is ineluctably driven to the conclusion that it is, and it ought also to hesitate to come to that conclusion when the consequences of it will be to deprive the executive of a weapon which it may need to combat subversive movements and preserve the safety of the infant State.  It ought to be, and indeed, under the Constitution, must be, left to Parliament in its own good time and wisdom to repeal such provisions as are contained in the Press (Emergency Powers) Act, 1931, as it thinks fit.

Pre-Constitution law made by a competent authority: effect of

A pre-Constitution law made by a competent authority, though it has lost its legislative competency under the Constitution, shall continue in force, provided the law does not contravene the “other provisions” of the Constitution.

Gannon Dunkerly and Co. v. Sales Tax Officer, Maatancherry, ILR (1957) Kerala 462:( (S) AIR 1957 Kerala 146); Sagar Mall v. State, ILR (1952) 1 All 862; Kanpur Oil Mills v. Judge (Appeals) Sales Tax Kanpur, (S) AIR 1955 All 99; Amalgamated Coalfields Ltd. v. Janapada Sabha, Chhindware,(1962)1 SCR 1 Jagdish Prasad v. Saharanpur Municipality, AIR 1961 All 583; Sheoshankar v. State Govt. of M. P. AIR 1951 Nag 58; State v. Yash Pal, (S)AIR 1957 Punj 91 and Binoy Bhusan v. States of Bihar AIR 1954 Pat 346. It is not necessary to consider in detail the said decisions, as they either resume the said legal position or sustain it, but do not go further.

They held that a law made by a competent authority before the Constitution continues to be in force after the Constitution till it is altered or modified or repealed by the appropriate authority, even though it is beyond the legislative competence of the said authority under the Constitution.

We give our full assent to the view and hold that a pre-Constitution law made by a competent authority, though it has lost it legislative competency under the Constitution, shall continue in force, provided the law does not contravene the “other provisions” of the Constitution. [South India Corporation (P) Ltd Vs Secretary, Board of Revenue, Trivandrum and another AIR 1964 SC 207 : (1964) 4 SCR 280]

South India Corporation (P) Ltd Vs Secretary, Board of Revenue, Trivandrum and another-13/08/1963

Art. 372 cannot be construed in such a way as to enlarge the scope of the saving of taxes, duties, cesses or fees. To state it differently, Art. 372 must be read subject to Art. 277. We have already held that an agreement can be entered into between the Union and the States in terms of Art. 278 abrogating or modifying the power preserved to the States under Art. 277

AIR 1964 SC 207 : (1964) 4 SCR 280

SUPREME COURT OF INDIA

South India Corporation (P) Ltd

Versus

Secretary, Board of Revenue, Trivandrum and another

(Before : S. K. Das, Actg., C.J.I., K. Subba Rao, Raghubar Dayal, N. Rajagopala Ayyangar And J. R. Mudholkar, JJ.)

Civil Appeals Nos. 295 to 298 of 1962,Decided on : 13-08-1963.

Constitution of India, 1950—Articles 277, 278, 372—Agreements between President and Raj Pramukh—Validity of.

Counsel for the Parties:

Mr. M. K. Nambiar, Senior Advocate, (M/s. J. B. Dadachanji, O. C. Mathur and Ravinder Narain, Advocates of M/s. J. B. Dadachanji and Co., with him), for Appellant (In all Appeals);

Mr. V. P. Gopalan Nambiar, Advocate General, for the State of Kerala, Mr. Sardar Bahadur, Advocate, with him), for Respondents (In all Appeals.)

Judgment

Subba Rao, J.—These four companion appeals arise out of a common judgment of the High Court of Kerala dismissing the four petitions filed by the appellant seeking to quash the orders of assessment made by the Sales Tax authorities imposing sales tax in respect of “works contracts”.

2. The undisputed facts may briefly be stated. The appellant is a private limited company incorporated under the Indian companies Act. The principal office of the Company is at Mattancherry. It carries on business in iron, hardware, electrical goods, timber, coir engineering contracts etc. In the course of its business, the company acted as engineering contractor for the State and Central Government departments and also for private parties. On March 17, 1959, the Sales Tax Officer, Special Circle, Ernakulam, assessed the Company to sales tax under the Travancore-Cochin General Sales Tax Act, 1125 M. E. for the assessment year 1952-53 in respect of “works contracts.” The Company filed a revision petition before the 1st respondent, but it was rejected. Likewise the 2nd respondent assessed the Company to sales tax by his orders dated 7-1-1960, 4-1-1960 and 31-3-1960 for the assessment years 1956-57, 1957-58 and 1958-59 in respect of “works contracts”. The appellant filed four petitions in the High Court of Kerala under Arts. 226 and 227 of the Constitution for quashing the said orders of assessment. The main contention advanced on behalf of the appellant-Company before the High Court was that, after the Constitution came into force the relevant Sales Tax Acts imposing sales tax on “works contracts” were unconstitutional and, therefore, void. The High court rejected the contention and dismissed the petitions with costs. Hence the appeals.

3. Before adverting to the rival contentions it would be convenient at the outset to give briefly the historical background of the sales tax legislation in Kerala.

4. Originally, Travancore and Cochin were two separate sovereign States having plenary powers of taxation. In the Cochin State, the Cochin General Sales Tax Act 15 of 1121 M. E. and in the Travancore State the Travancore General Sales Tax Act 18 of 1124 M. E. imposed tax on “works contracts.” As a result of the merger of the two States, the United State of Travancore-Cochin was formed with a common Legislature. The said Legislature enacted the Travancore-Chochin General Sales Tax Act 11 of 1125 M. E. (1950), hereinafter called the Act. The said Legislature also had plenary powers of taxation and, therefore, it validly imposed sales tax on “works contracts”. The Act was published in the Gazette on January 17, 1950, but S. 1 (3) thereof provided that it would come into force on such date as the Government might, by notification in the Gazette, appoint. The requisite notification was issued by the Government on May 30,1950. Rules were framed under powers conferred by S. 24 of the Act prescribing the mode, interalia, for ascertaining the amounts for which goods were sold in relation to “works contracts” Rule 4 (3) provided that,

“For the purposes of sub-rule (1), the amount for which goods are sold by a dealer shall, in relation to a works contract, be deemed to be the amount payable to the dealer for carrying out such contract less a sum not exceeding such percentage of the amount payable as may be fixed by the Board of Revenue from time to time for different areas, representing the usual proportion in such areas of the cost of labour to the cost of materials used in carrying out such contract; subject to the following maximum percentages:—

xx xx xx”

But, it is stated that the Board of Revenue did not fix the percentage for deduction from the amount payable to the dealer for carrying out a works contract. This fact was not denied in the High Court, but before us an application is made to produce the Travancore-Cochin Gazette to establish that such a percentage was fixed. The Rules also were notified on may 30. 1950. The earlier Acts of Travancore and Cochin were repealed from May 30, 1950. Till may 30, 1950, sales tax was levied on works contracts in Travancore and Cochin areas under the respective Acts and the rules framed thereunder. As from the said date the said Acts were repealed, thereafter the said tax was imposed under the Act and the rules framed thereunder. On November 1, 1956, the States Reorganization Act of 1956 came into force and the new State of Kerala was formed thereunder . The newly formed Kerala State comprised the area covered by the Travancore-Cochin State, excepting a small part thereof, and the district of Malabar in the Madras State. Thereafter, the Kerala Legislature passed the Travancore-Cochin General Sales Tax (Amendment) Act, 1957 (12 of 1957) amending the Act and extending its provisions to the whole State of Kerala. The new Act practically contained the provisions of the earlier Act. The said Act came into force on October 1. 1957. By the provisions of Act 12 of 1957, among other things, the tax on electric goods was enhanced from 3 n.p. to 4 n. p. in the rupee and in regard to cement, this item was freshly added and charged to sales tax at 5 n. p. in the rupee. The State of Kerala does not admit that either there was any enhancement of tax in the case of electrical goods or that any tax was imposed in regard to cement involved in a works contract. Further, the sales tax leviable under the Act was enhanced by the Kerala Surcharge on Taxes Act, 1957 (11 of 1957) and again by the Kerala surcharge on Taxes Act, 1960. We are not concerned with the latter Act, as no assessment was made under that Act in respect of any of the transactions in question.

5. The factual position may, therefore, be stated thus:The assessment for the year 1952-53 was made only under the Travancore-Chochin General Sales Tax Act (11 of 1125 M. E. ) and therefore, the subsequent alleged enhancement of the tax does not affect the assessment of that year. Assessments for the years 1956-57 1957-58 and 1958-59 were made under the Travancore-Chochin General Sales Tax (Amendment) Act, 1957 (12 of 1957) and, therefore, the provision, if any, enhancing the rate under the Act would affect the said assessments. The enhancements made under the Kerala Act 11 of 1957 would not govern the assessment year 1956-57, but only the assessment years 1957-58 and 1958-59

6. The material contentions of Mr. Nambiar, appearing for the appellant, may be summarized thus:(1) The Travancore-Cochin Act of 1125 would not continue in force under Art. 372 of the Constitution inasmuch as its provisions were inconsistent with the structure of the Constitution as well as with the provisions of Part XII thereof. (2) Art. 277 of the Constitution cannot be relied upon by the respondent, as it can be availed of only:(a) if a particular tax was lawfully levied by the Government of the State immediately before the Commencement of the Constitution and is expressly mentioned in the Union List, and (b) if there is an identity between the tax imposed by the State before the Constitution and that continued by it thereafter in respect of rate, area, State and purpose. It is said that the said two conditions are not satisfied. (3) Assuming that Art. 277 applied, the said provision could not be relied upon by the appellant in view of the agreement entered into between the Rajpramukh of Travancore and the Union Government under Art, 278 of the Constitution. (4) The impugned Act, in so far as it imposed tax in respect of “works contracts” would offend Art. 14 of the Constitution inasmuch as it was not applied to areas other than those covered by the Travancore-Cochin States and, therefore, discriminatory in its application. And (5) in any view, in respect of the assessment year 1952-53 the non-fixation of the percentage by the Board of revenue under R. 4(3) of the Rules made under the Act renders the said assessment illegal.

7. The learned Advocate-General of Kerala counters some of the said arguments. We shall refer to his arguments in the course of the judgment at appropriate places. It may be mentioned at this stage that the learned Advocate-General conceded that the assessment orders for the years 1956-57, 1957-58 and 1958-59 made under the Travancore-Cochin General Sales Tax (Amendment) Act, 1957 (12 of 1957) and the Kerala surcharge on Taxes Act (11 of 1957) were bad, but prayed that the State might be given liberty to assess the appellant de novo for the said years under the Act.

8. The main contention of learned counsel for the appellant centers on the provisions of Arts. 277 and 278 of the Constitution. Under Art. 277, any taxes that were being lawfully levied by the Government of any State before the Constitution could be continued to be levied thereafter, notwithstanding that the said taxes were mentioned in the Union List, till Parliament made a law to the contrary. Article 278 enables the Government of India and a State government specified in part B of the First Schedule to the Constitution to enter into an agreement with respect to levy and collection of any tax leviable by the Government of India in such State and for the distribution of the proceeds thereof and also in respect of the grant of any financial assistance by the Government of India to such State if it incurred any loss of revenue derived by it from any source. Under cl. (2) thereof, such an agreement shall continue in force for a period of ten years from the commencement of the Constitution. We are not concerned here with the legal position after the expiry of the said period, and we do not propose to express our view thereon.

9. The first contention of learned counsel for the appellant is that Art. 277 of the Constitution can only save the levy of a tax that was being lawfully levied by a State immediately before the commencement of the Constitution and that, as the Act came into force only after the Constitution, the levy made thereunder does not satisfy the condition laid down by the article. To appreciate this contention some relevant facts may be recapitulated. The Act was published in the Gazette on January 17, 1950, but was brought into force only on May 30, 1950, i.e., after the commencement of the Constitution. If so, it follows that the tax under the Act would not be saved, as the necessary condition that the levy should have been lawfully made before the Constitution was not satisfied.

10. On the assumption that Art. 277 saved the levy of tax under the Act, the further contention of the appellant is that thee was an agreement dated February 25, 1950 between the President of India and the Rajpramukh of the State of Travancore-Cochin in the matter of the federal financial integration in the said State and that under the said agreement the Union agreed to recoup the loss in revenue incurred by the said State by reason of the Constitutional transference of the B State’s power of taxation in respect of certain items to the Union List and that, thereafter, the State ceased to have the power to levy any tax in respect of the subjects so transferred. The learned Advocate-General, on the other hand, contends that Art. 278 (2) enables the Union and a B State to enter into an agreement only in respect of a tax leviable by the Government of India in the said State and in respect whereof a loss has been incurred by the State by reason of the fact that under the Constitution it has ceased to have the power to levy and collect the said tax, and that, as in the instant case by reasons of Art. 277 the State would continue to have the power to levy the tax in respect of “works contracts” till Parliament made appropriate law, it did not incur any loss in respect of the said tax and, therefore, no valid agreement could be entered into between the State Government and the Union in respect thereof. To state it differently, Art, 278 does not come into play unless the Government of India acquires the power to levy a particular tax saved by Art. 277 by Parliament making an appropriate law; for , it is said, with some force, there cannot be an agreement to recoup any loss of revenue when there is no such loss. But this question is covered by a decision of this Court in Union of India v. Maharaja Krishnagarh Mills Ltd., (1961) 3 SCR 524. There, the question of determination was whether the Union of India was entitled to levy and recover arrears of excise duty on cotton cloth for the period April 1, 1949 to March 31, 1950, payable by the respondent, a cloth mill in the State of Rajasthan, under the Rajasthan Excise Duties Ordinance, 1949. By reason of Art. 277 of the Constitution, the State of Rajasthan became entitled to recover the said duty notwithstanding the fact that it was transferred to the Union List. The provision to the contrary contemplated by Art. 277 of the Constitution was made by Finance Act XXV of 1950, S. 11 whereof extended the Central Excises and Salt Act, 1944, along with other Acts, to the whole of India except the State of Jammu and Kashmir. That section had effect only from April 1, 1950 and did not apply to arrears of duty of excise in regard to the earlier period. The Union pleaded that an agreement envisaged by Art. 278 was entered into on February 25, 1950 which conceded to the Centre the right to levy and collect the arrears of duty in question. The question now raised before us, namely whether there can be a valid agreement under Art. 278 of the Constitution in respect of taxes leviable by the State and not leviable by the Government of India till an appropriate law is made by Parliament arose for consideration in that case. The learned Chief Justice, speaking for the Court, came to the following conclusion.

“Thus, the combined operation of Arts. 277 and 278 read with the agreement vests the power of levy and collection of the duty in the Union of India”

The reasons for the conclusion are found.

“It is noteworthy that the provisions of Art. 278 override pro tanto other provisions of the Constitution including Art. 277 and the terms of the agreement override the provisions of the Chapter, namely, Chapter I of Part XII …………Article 277, therefore, is in the nature of a saving provision permitting the States to levy a tax or a duty which, after the Constitution, could be levied only by the Centre. But Art. 277 must yield to any agreement made between the Government of India and the Government of a State in Part B in respect of such taxes or duties etc.”

The learned Chief Justice proceeded to state thus p. 535 (of SCR):

“That a duty of the kind now in controversy on the date of the agreement after coming into force of the Constitution is leviable only by the Government of India even in respect of the State of Rajasthan is clear beyond all doubt. The Union List only, namely, entry 84 in the Seventh Schedule, authorises the levy and collection of the duty in question …. It is true that Art. 277 has saved, for the time being, until Parliament made a provision to the contrary the power of the State of Rajasthan to levy such a duty, but that is only a saving provision, in terms subject to the provisions of Art. 278,”

This Court, therefore, held that after the coming into force of the Constitution the excise duty in question in that case was leviable only by the Government of India, though there was a saving provision in favour of the State of Rajasthan till Parliament made an appropriate law; and on that reasoning it held that the agreement under Art. 278 could be made in respect of such a levy notwithstanding the temporary reservation made in favour of the State. The only difference between that case and the present one is that at the time the agreement was entered into between the Union and the State, Parliament had not made the appropriate law depriving the State of its power to levy taxes in respect of “works contracts” But that cannot make any difference in principle, for, even the earlier decision related only to the validity of the agreement in respect of arrears leviable by the State before the appropriate law was made. The effect of the provisions in Art. 278 is that to the extent covered by an agreement the power of the State Government to continue to levy taxes under Art. 277 superseded.

11. The next question is whether there was any such agreement where under the State agreed to give up its right to levy the said tax as a part of the agreement entered into by it with the Union. This leads us to consider the terms of the agreement dated February 25, 1950, entered into between the President of India and the Rajpramukh of the State of Travancore-Cochin. It would be convenient to read the relevant clauses of the agreement. It reads:

“Whereas provision is made by Articles 278, 291, 295, and 306 of the Constitution of India for certain matters to be governed by agreement between the Government of India and the Government of a State specified in Part B of the First Schedule to the Constitution:

**********

Now, therefore, the President of India and the Rajpramukh of Travancore-Cochin, have entered into the following agreement, namely:-

The recommendations of the Indian State Finances Enquiry Commission, 1948-49 (hereafter referred to as the Committee) contained in Part I of its Report read with Chapters I, II, III of Part II of its Report, in so far as they apply to Travancore-Cochin (hereinafter referred to as the State) together with the recommendations contained in the Committee’s Second Interim Report, are accepted by the parties thereto, subject to the following modifications namely:-

1. With reference to paragraph 6 of the committee’s Second interim Report, the date of federal financial integration of the State shall be 1st April 1950.

2. **********

3. The Committee’s formula of guaranteeing the ‘federal’ revenue-gap for the first five years after federal financial integration and of tapering it down over the next five years will be applied to the combined ‘federal’ revenue-gap of the former Indian States, Travancore and Cochin, taken together, computed as in (2) above.

**********

Subject to the provisions of the Constitution of India, this agreement, shall, except where the context of the Committee’s Report and of this agreement otherwise require, remain in force for a period of ten years from the commencement of the Constitution of India.”

It will be seen from the said agreement that it incorporated the recommendations made by the Indian State Finance Enquiry Committee with some modifications and that the Union of India agreed to recoup the State for the loss caused to it by reason of the federal financial integration in the manner described thereunder. It was not a piecemeal agreement confined to a few items, but a comprehensive one to fill up the entire revenue-gap caused to the State by reason of some of its sources of revenue having been taken away by the Union or otherwise lost to it. A perusal of the main recommendations made by the Indian States Finance Enquiry Committee and incorporated in the agreement also indicates the completeness of the arrangement. The Committee was asked to examine and report inter alia, whether, and if so, the extent to which, the process of so integrating Federal Finance in the Indian States and Union with that of the rest of India should be gradual and the manner in which it should be brought about. One of the general principles followed by the Committee was that federal financial integration in States involved not merely the taking over of all their “federal” revenues by the Centre, but also the assumption of all expenditure in States upon Departments and Service of a ‘federal’ Revenues and ‘Federal’ service departments”, it was stated that with effect from the prescribed date, the Centre will take over all ‘federal’ sources of Revenue and all ‘federal’ items of expenditure in States together with the administration of the Departments concerned, and that the Centre must also take over all the current outstandings, liabilities, claims, etc. and all, productive and unproductive Capital assets connected with these departments.

Dealing with the States’ rights it observed:

“With effect from the prescribed date, all ‘rights and immunities’ enjoyed or claimed by the States, whether expressly or by usage and whether relating to ‘federal’ revenues and taxes generally present or future, or to specific matters such as Railways, Customs, Posts and Telegraphs, Opium, salt, etc., will terminate and must be extinguished. Thereafter, their constitutional position in respect of these matters should be the same as that of Provinces under the new Constitution of India.”

The Committee recommended that the whole body of State legislation to ‘federal’ subjects should be repealed and the corresponding body of Central legislation extended proprio vigore to the States, with effect from the prescribed date, or as and when the administration of particular ‘federal’ subject is assumed by the Centre. In its second Interim Report, dealing with Travancore and Cochin, the following recommendation were made:

“Revenue Gap” arising out of ‘Federal’ Financial Integration:

(i) The net revenue loss to the Travancore and Cochin States, taken together, upon federal financial integration (on the basis of figures for their financial year 1123 M. E.) would be `330 lakhs; this includes a net loss of ` 100 lakhs by abolition of internal Customs Duties in Travancore State.

(ii) We recommend that-

(a) the loss resulting from the immediate abolition of Internal Customs Duties of Travancore must borne by the State Government.

(b) As regards the residual net Central Revenue-gap of the two States taken together (Rs. 230 lakhs), there should be a guaranteed reimbursement by the Central Government to the following extent during transitional period:

From the date of federal financial integration ` 230 lakhs per annum to 31st March 1955.

The agreement, read with the Report makes the following position clear: The loss arising to the State on account of the federal financial integration in the State was ascertained and a provision was made for subsidizing the State by filling up the said revenue-gap. The agreement ex facie appears to be a comprehensive one. It takes into consideration the entire loss caused to the State by reason of some of its sources of revenue being transferred under the Constitution to the Union. It would be unreasonable to construe the agreement as to exclude from its operation certain taxes which the State was authorized to levy for a temporary period. As we have said, that saving was subject to an agreement and, as by the agreement effective adjustments were made to meet the loss which the State would have incurred but for the agreement, there was no longer any necessity for the continuance of the saving and, it ceased to have any force thereafter between the parties to the agreement. We are not called upon in this case to decide whether the said power revived after the expiry of ten years from the commencement of the Constitution, for all the impugned assessments fall within the said period. Nor do we find any force in the contention that as Art. 278 was omitted by the Constitution (Seventh Amendment) Act, 1956, the agreement entered into in exercise of a power thereunder automatically came to an end and thereafter the power of the State to levy the tax came into life again. An obvious fallacy underlies this ingenious argument. The validity of an agreement depends upon the existence of power at the time it was entered into. Its duration will be limited by its terms or by the conditions imposed on the power itself. Article 278 conferred a power upon the Union and the B State to enter into an agreement which would continue in force for a period not exceeding ten years from the commencement of the Constitution. The agreement in question fell squarely within the scope of the power. That agreement, therefore, would have its full force unless the Constitution (Seventh Amendment) Act, 1956 in terms avoided it. The said amendment was only prospective in operation and it could not have affected the validity of the agreement. We, therefore, hold that the impugned assessment orders were not validly made by the sales tax authorities in exercise of the power saved under Art. 277 of the Constitution.

12. Learned Advocate-General for the State of Kerala raises an interesting point, namely, that the impugned law, i.e., the Travancore-Cochin General Sales Tax Act of 1125 M. E. continued in force after the Constitution under the express provisions of Art. 372 thereof till the said law was altered, repealed or amended by the competent authority and, therefore, even if there was an agreement between the Union and the State as aforesaid, it could not affect the power of the State to impose the tax under the said law.

13. Mr. Nambiar, on the other hand, argues that Art. 372 is subject to other provisions of the Constitution and a law empowering a State to impose a tax in respect of a federal subject is inconsistent with the federal structure of the Constitution and, therefore, is bad; and, that apart, it is also inconsistent with the express provisions of Part XII of the Constitution and particularly with those of Arts. 277 and 278 thereof. Article 372 reads:

“(1) Notwithstanding the repeal by this Constitution of the enactment’s referred to in Art. 395 but subject to the other provisions of this Constitution, all the law in force in the territory of India immediately before the commencement of this Constitution shall continue in force therein until altered or repealed or amended by a competent Legislature or other competent authority.

**********

Explanation 1—The expression “law in force” in this article shall include a law passed or made by a Legislature or other competent authority in the territory of India before the commencement of this Constitution and not previously repealed, notwithstanding that it or parts of it may not be then in operation either at all or in particular areas.”

The object of this article is to maintain the continuity of the pre-existing laws after the Constitution came into force till they were repealed, altered or amended by a competent authority. Without the aid of such an article there would be utter confusion in the field of law. The assumption underlying the article is that the State laws may or may not be within the legislative competence of the appropriate authority under the Constitution. The article would become ineffective and purposeless if it was held that pre-Constitution laws should be such as could be made by the appropriate authority under the Constitution. The words “subject to the other provisions of the Constitution” should, therefore, be given a reasonable interpretation, an interpretation which would carry out the intention of the makers of the Constitution and also which is in accord with the constitutional practice in such matters. The article posits the continuation of the pre-existing laws made by a competent authority notwithstanding the repeal of Art. 395; and the expression “other” in the article can only apply to provisions other than those dealing with legislative competence.

14. The learned Advocate-General relied upon the following decisions for the said legal position; Gannon Dunkerly and Co. v. Sales Tax Officer, Maatancherry, ILR (1957) Kerala 462:( (S) AIR 1957 Kerala 146); Sagar Mall v. State, ILR (1952) 1 All 862; Kanpur Oil Mills v. Judge (Appeals) Sales Tax Kanpur, (S) AIR 1955 All 99; Amalgamated Coalfields Ltd. v. Janapada Sabha, Chhindware, (1962) 1 SCR 1 Jagdish Prasad v. Saharanpur Municipality, AIR 1961 All 583; Sheoshankar v. State Govt. of M. P. AIR 1951 Nag 58; State v. Yash Pal, (S)AIR 1957 Punj 91 and Binoy Bhusan v. States of Bihar AIR 1954 Pat 346. It is not necessary to consider in detail the said decisions, as they either resume the said legal position or sustain it, but do not go further. They held that a law made by a competent authority before the Constitution continues to be in force after the Constitution till it is altered or modified or repealed by the appropriate authority, even though it is beyond the legislative competence of the said authority under the Constitution. We give our full assent to the view and hold that a pre-Constitution law made by a competent authority, though it has lost it legislative competency under the Constitution, shall continue in force, provided the law does not contravene the “other provisions” of the Constitution.

15. But the real question is whether the said impugned law is inconsistent with provisions of the Constitution other than those dealing with its legislative competency. The words “subject to other provisions of the Constitution” mean that if there is an irreconcilable conflict between the pre-existing law and a provision or provisions of the Constitution, the latter shall prevail to the extent of that inconsistency. An article of the Constitution by its express terms may come into conflict with a pre-Constitution law wholly or in part; the said article or articles may also by necessary implication, come into direct conflict with the pre-existing law. It may also be that the combined operation of a series of articles may bring about a situation making the existence of the pre-existing law incongruous in that situation. Whatever it may be, the inconsistency must be spelled out from the other provisions of the Constitution and cannot be built upon the supposed political philosophy underlying the Constitution. These observations are necessitated by the reliance of Mr. Nambiar on two decisions of the Supreme Court of the United States of America. In Chicago, Rock Island and Pacific Railway Co. v. William McGlinn, (1884) 29 Law Ed 270 the facts, briefly were: The Act of Kansas purported to cede to the United States exclusive jurisdiction over the Fort Leavenworth Military Reservation. In considering the question whether the previous laws continued after the said cession, the Supreme court of the United States of America made a distinction between laws of political character and municipal laws intended for the protection of private rights, but we are not concerned with that question in this case; and indeed the law of India appears to be different from that of America in that regard. But what is relied upon is the effect of cession pre-existing laws which are in conflict with the political character, institution and Constitution of the new Government. Field J., speaking for the Court observed, at page No. 272, as follows:

“As a matter of course, all laws, ordinances and regulations in conflict with the political character, institution and Constitution of the new government are at once displaced. Thus, upon a cession of political jurisdiction and legislative power – and the latter is involved in the former-to the United States, the laws of the country in support of an established religion or abridging the freedom of the press, or authorizing cruel and unusual punishments, and the like, would at once cease to be of obligatory force without any declaration to that effect; and the laws of the country on other subjects would necessarily be superseded by existing laws of the new government upon the same matters.”

16. The same view was reiterated by the Supreme Court of the United States of America in a later decision in Vilas v. City of Manila, (1910) 55 Law Ed 491. We are not concerned in this case with the general principles enunciated by the law of America, but only with the express provisions of Art. 372 of our Constitution. That apart, it may also be inappropriate to rely upon the legal consequences of a cession of a State under the American law for the interpretation of Art. 372 of our constitution, which deals with a different situation and lays down expressly the legal position to meet the same. We would therefore, confine our attention to the express provisions of the Constitution in considering the question raised before us.

17. The relevant provisions which have a bearing on the said question are found in Part XII of the Constitution. Chapter I deals with finance; and this chapter contains a scheme of federal financial integration in the States. Though the Constitution conferred upon the Union and the States independent powers of taxation and constituted separate consolidated funds, it evolved a procedure for an equitable readjustment of the taxes collected between the Union and the States. But before the Constitution came into force the states were levying and collecting certain taxes which, under the Constitution, were allotted to the Union. The immediate exercise of the Union power of taxation in respect of such taxes would dislocate the finances of the States and introduce difficulties in the administration. To avoid this Art. 277 saved the existing taxes levied by the States, though they have been transferred to the Union List by the Constitution, till Parliament made appropriate law. But the Constitution was also made applicable to Part B States. They had plenary powers of taxation. Their relationship with the paramount power differed from State to State. Further, most of the States were in a state of financial instability and required substantial help from the Union to bring them up to the standard of Part A States. There would be a serious dislocation in the administration of the said States by a sudden withdrawal of the federal sources of revenue. The provisions of Part XII of the Constitution, with the saving embodied in Art. 277, may have met the situation obtaining in Part A States, but they were inadequate for Part B States. Therefore, a special provision under Art. 278 was made in respect of Part B States enabling them to enter into an agreement with the Union embodying terms contrary to the other provisions of the Constitution in respect of levy and collection of taxes and the grant of any financial assistance to such State or States.

18. With this background let us now consider the following two questions raised before ns:(1) Whether Art. 372 of the Constitution is subject to Art. 277 thereof; and (2) whether Art. 372 is subject to Art. 278 thereof. Article 872 is a general provision; and Art. 277 is a special provision. It is settled law that a special provision should be given effect to the extent of its scope, leaving the general provision to control cases where the special provision does not apply. The earlier discussion makes it abundantly clear that the Constitution gives a separate treatment to the subject of finance, and Art. 277 saves the existing taxes etc. levied by States, if the conditions mentioned therein are complied with. While Art. 372 saves all pre-Constitution valid laws, Art. 277 is confined only to taxes, duties, cesses or fees lawfully levied immediately before the Constitution. Therefore, Art. 372 cannot be construed in such a way as to enlarge the scope of the saving of taxes, duties, cesses or fees. To state it differently, Art. 372 must be read subject to Art. 277. We have already held that an agreement can be entered into between the Union and the States in terms of Art. 278 abrogating or modifying the power preserved to the States under Art. 277.

19. That apart, even if Art. 372 continues the pre-Constitution laws of taxation, that provision is expressly made subject to the other provisions of the Constitution. The expression “subject to” conveys the idea of a provision yielding place to another provision or other provisions to which it is made subject. Further Art. 278 opens out with a non-obstanate clause. The phrase “notwithstanding anything in the Constitution” is equivalent to saying that in spite of the other articles of the Constitution, or that the other articles shall not be an impediment to the operation of Art. 278 While Art. 372, is subject to Art. 278 , Art. 278 operates in it own sphere in spite of Art. 372 The result is that Art. 278 overrides Art. 372 that is to say, notwithstanding the fact that a pre-Constitution taxation law continues in force under Art. 372, the Union and the State Governments can enter into an agreement in terms of Art. 278 in respect of Part B States depriving the State law of its efficacy. In one view Art. 277 excludes the operation of Art. 372 and in the other view, an agreement in terms of Art. 278 overrides Art. 372. In either view, the result is the same, namely, that at any rate during the period covered by the agreement the States ceased to have any power to impose the tax in respect of “works contracts.”

20. In this view we need not express our opinion-on the other contentions raise by Mr. Nambiar.

21. In the result, the said orders of assessment are set aside and the appeals are allowed with cost here and in the High Court One set of hearing fee.

The position of an Additional Judge under Article 224 of Indian Constitution

  • The System of appointment of additional Judges was  in vogue when the Constituent Assembly met to frame the Constitution.
  • So long as there is a post of a permanent Judge vacant, no appointment of an additional Judge can be made under Cl. (1) of Article 224.
  • when the term of an additional Judge expires he ceases to be a Judge and therefore, if he is to continue as a Judge, he must be either reappointed as an additional Judge or appointed as a permanent Judge.
  • The acting Judge contemplated in Art. 198 was therefore clearly a temporary Judge.

In S. P. Gupta Vs President of India and others-30/12/82 the matter has been discussed in length-

31.  We then turn to consider what is the position of an additional Judge under the Constitution. This question is of the greatest importance because as against a total sanctioned strength of 308 permanent Judges, there is a total sanctioned strength of as many as 97 additional Judges, which means that the total sanctioned strength of additional Judges is almost one third the total sanctioned strength of permanent Judges. There are a large number of additional Judges in various High Courts whose tenure is short and precarious and their fate should therefore naturally be a matter of serious concern for this Court. The power to appoint an additional. Judge in a High Court is to be found in Cl. (1) of Art. 224 which reads as follows:

“If by reason of any temporary increase in the business of a High Court or by reason of arrears of work. therein, it appears to the President that the number of the Judges of that Court should be for the time being increased, the President may, appoint duly qualified persons to be additional Judges of the Court for such period not, exceeding two years as he may specify.”

Cl. (2) of Art. 224 provides for appointment of an acting Judge during the period when any Judge of a High Court other than the Chief Justice is, by reason of absence or for any other reason, unable to perform the duties of his office or is appointed temporarily as Chief Justice. It is obvious that the tenure of an acting Judge is by its very nature limited because he is appointed to act as a Judge only during the period when the permanent Judge in whose place he is acting is unable to perform the duties of his office and he would therefore cease to be a Judge as soon as the permanent Judge resumes his duties. We are not concerned in these writ petitions with the case of an acting Judge and we need not therefore dwell any further on this clause. Cl. (3) of Art. 224 provides inter alia that no person appointed as an additional Judge shall hold office after attaining. the age of 62 years. Therefore even if an additional Judge has been appointed for a period of two years, he would cease to be a Judge if he attains the age of 62 years prior to the expiration of his term of two years.

32.  It is clear from the provisions of Cl. (1) of Art. 224 that the maximum period for which an additional Judge can be appointed by the President is two years. This provision for appointment of a Judge for a period not exceeding two years seems to be peculiar to this country. There is no such practice of appointing a Judge for a short term either in the United Kingdom or in the United States of America. Even in India. there are no Judges either in the Supreme Court or in the subordinate judiciary whose tenure is so short. It is rather an unusual provision and in order to understand its true scope and effect, it is necessary to trace briefly its historical evolution.

33.  There was no provision in the High Courts Act or the Charter Act, 1861 for appointment of an additional Judge with a restricted tenure in a High Court. It was for the first time in. the Govt. of India Act, 1915 that a provision was enacted for appointment of additional Judges. Sub-sec. (2) of S. 101 provided that each High Court shall consist of the Chief Justice and as many other Judges as His Majesty may think fit to appoint and Cl. (i) of the proviso to that sub-section authorised the Governor General in Council to appoint persons to act as additional Judges of any High Court for such period not exceeding two years as may be required. The additional Judges were to have all the powers of a Judge of the High Court appointed by His Majesty. The Government of India Act, 1915 was replaced by the Government of India Act, 1935 and S. 220 of that Act provided that every High Court shall consist of a Chief Justice and such other Judges as His Majesty may from time to time deem it necessary to appoint and there was a proviso to this section which said that the Judges so appointed together with any additional Judges appointed by the Governor General shall at no time exceed in number such maximum number as the Governor-General may by order fix in relation to that Court. Sec. 222 sub-sec. (3) provided for appointment of additional Judges in these. terms:

“Section 222 (3). If by reason of any temporary increase in the business of any High Court or by reason of arrears of work in any such Court it appears to the Governor-General that the number of the Judges of the Court should be for the time being increased, the Governor-General (in his discretion) may, subject to the foregoing provisions of this chapter with respect to them maximum number of Judges, appoint persons duly qualified for appointment as Judges to be additional Judges of the Court for such period not exceeding two years as he may specify.”

The System of appointment of additional Judges was therefore in vogue when the Constituent Assembly met to frame the Constitution. Article 199 of the Draft Constitution was almost in the same terms as sub-sec. (3) of S. 222 of the Government of India Act, 1935. There was also Art. 198 in the Draft Constitution which in Cl. (1) provided for appointment of an acting Chief Justice and in Cl. (2) for appointment of an acting Judge. The provision for appointment of an acting Judge made in Cl (2) of Art. 198 was that when the office of any Judge of a High Court is vacant or when any such Judge is appointed to act temporarily as a Chief Justice or is unable to perform the duties of his office by reason of absence or otherwise, the President may appoint a person duly qualified for appointment as a Judge to act as a Judge of that Court. The acting Judge contemplated by this clause of Art. 198 was therefore clearly a temporary Judge. Now when Arts. 198 and 199 in the Draft Constitution came to be considered in the Constituent Assembly, a number of representations were received suggesting that both these articles should be deleted from the Constitution. It was felt by many that the practice of appointing acting or additional Judges was pernicious and it should be done away with. Tej Bahadur Sapru expressed his firm opposition to this practice of appointing acting or additional Judges in the course of his speech in the Constituent Assembly. He said, decrying this practice in no uncertain terms:

“Additional Judges under the old Constitution were appointed by the Governor-General for a period not exceeding two years. I do not know whether that condition has been reproduced in the proposed Constitution. This prohibition, however, does not apply to acting judges or temporary judges. I think the rule in future should be that any barrister or advocate, who accepts a seat on the Bench, shall be prohibited from resuming practice anywhere on retirement. I would not, however, apply this to temporary judges taken from the services who hold a seat on the Bench for a few months. but I would add that the practice of appointing additional and temporary judges should be definitely given up. When I said at the Round Table Conference that there were acting, additional and temporary judges in India, some of the English lawyers not accustomed to India Law felt rather surprised. I am also of the opinion that temporary or acting judges do greater harm than permanent judges, when after their seat on the Bench for a short period they revert to the Bar. A seat on the Bench gives them a pre-eminence over their colleagues and embarrasses the subordinate judges who were at one time under their control and thus instead of their helping justice they act as a hindrance to free justice. I have very strong feeling in this matter and have during my long experience seen the evil effects, of unchecked resumption of practice by barristers and advocates.”

There were also many others who expressed the same view. The Drafting Committee agreed with this view and expressed the opinion that “it would be better to delete Articles 198 and 199 relating to the appointment of temporary and additional Judges, than to retain those articles without the ban on practice by persons who hold office as additional or temporary judges.” The Drafting Committee took the view that “it was possible to discontinue the system of appointment of temporary and additional Judges in the High Courts altogether by increasing, if necessary, the total number of permanent judges of such Courts.” The Constituent Assembly adopted the recommendation of the Drafting Committee to delete Arts. 198 (2) and 199 of the Draft Constitution providing for appointment of acting and additional Judges in High Courts, with the result that when the Constitution came to be enacted, there was no provision in the Constitution for appointment of acting or additional Judges.

34.  It is clear from the discussions which took place in the Constituent Assembly that the Constitution makers realised that an acting or additional Judge would have to go back to the Bar on the expiration of his term of office and his tenure was of a strictly limited duration. The Constitution makers did not oppose the practice of appointing acting or additional Judge on the ground that on the expiration of his term of office, an acting or additional Judge would have to go back to the Bar, but their anxiety was that after going back to the Bar he would resume his practice and this might lead to abuses and it was this undesirable consequence which they wanted to prevent and that is why they deleted Arts. 198 (2) and 199 with a view to abolishing the practice of appointing acting or additional Judges. The underlying postulate of Articles 198 (2) and 199 was that an acting or additional Judge would come back to the Bar on the expiration of his term and start practice and this was intended to be stopped, but since it was not possible to debar an acting or additional Judge from practising after he came back on the expiration of term, it was decided that the institution of acting and additional Judges should be done away with. There was no assumption by the Constitution makers that an acting or additional Judge would necessarily be made permanent and he would not have to go back to the Bar. On the contrary, going back to the Bar was clearly contemplated and hence Articles 198 (2) and 199 were deleted. The Constitution makers also thought that it would be possible to discontinue the system of appointing acting and additional Judges altogether without any detriment to early disposal of cases, if the total number of permanent Judges was sufficiently increased.

35.  But within six years of the coming into force of the Constitution it was found that the arrears in the High Courts were increasing and it was becoming difficult to bring them under control. There was Art. 224 in the Constitution which provided that the Chief Justice of a High Court may at any time with the previous consent of the President request any retired Judge to sit and act as a Judge of the High Court. but this provision for recalling retired Judges to function on the Bench of a High Court for short periods was found to be neither adequate nor satisfactory and it was of no assistance in reducing the arrears of cases which were mounting-up from year to year. Parliament in its constituent capacity, therefore, decided to introduce two provisions; one for appointment of additional Judges to clear off the arrears and the other for the appointment of acting Judges in temporary vacancies and with that end in view, enacted the Constitution (Seventh Amendment) Act, 1956. This amending Act substituted the existing Art. 224 by a new Art, 224 which read as follows:

“Appointment of additional and acting Judges:

(1) If by reason of any temporary increase in the business of a High Court or by reason of arrears of work therein, it appears to the President that the number of the judges of that Court should be for the time being increased, the President may appoint duly qualified persons to be additional judges of the Court for such period not exceeding two years as he may specify.

(2) When any judge of a High Court other than the Chief Justice is by reason of absence or for any other reason unable to perform the duties of his office or is appointed to act temporarily as Chief Justice, the President may appoint a duly qualified person to act as a Judge of that Court until the permanent judge has resumed his office.

(3) No person appointed as an additional or acting judge of a High Court shall hold office after attaining the age of sixty-two years.

The existing Art. 224 was added as new Art. 224A after the new Art. 224. Cl. (1) of Art. 217 was also simultaneously amended with a view to making provision in regard, to an acting or additional Judge. We have already set out the amended Cl. (1) of Art. 217 in an earlier part of the Judgment and we need not therefore, reproduce it here once again.

36.  The first question which arises for determination under Art. 224 Cl. (1) is as to when can an additional Judge be appointed by the President. This article confers power on the President to appoint an additional Judge, if by reason of any temporary increase in the business of a High Court or by reason of arrears of work therein, it appears to the President that the number of the judges of that Court should be for the time being increased and in that event, he can appoint an additional Judge for such period not exceeding two years as he may specify. It must appear to the President that either by reason of temporary increase in the business of the High Court or by reason of accumulation arrears of work in the High Court, it is necessary to increase the number of the Judges of that Court for the timebeing. The power to appoint an additional Judge cannot therefore be exercised by the President unless there is either temporary increase in the business of the High Court or there is accumulation of arrears of work in the High Court and even when one of these two conditions exists, it is necessary that the President must be further satisfied that it is necessary to make a temporary increasein the number of Judges of that High Court, The words “for the time being” clearly indicate that the increase in the number of judges which the President may make by appointing additional Judges would be temporary with a view to dealing with the temporary increase in the business of the High Court or the arrears of work in the High Court. Article 224, Cl. (1) did not contemplate that the increase in the number of Judges should be for an indefinite duration. The object clearly was that additional Judge should be appointed for a short period in order to dispose of the temporary increase in the business of the High Court and/or to clear off the arrears of pending cases. There is sufficient indication in Cl. (1) of Art. 224 that the appointments of additional Judges were intended to be of short duration and Parliament expected that sufficient number of additional Judges would be appointed so as to dispose of the temporary increase in the work or the arrears of pending cases within a period of two years or thereabouts. That is why Cl. (1) of Article 224 provided that additional Judges, may be appointed for a period not exceeding two years. The underlying idea was that there should be an adequate strength of permanent Judges in each High Court to deal with its normal institutions and so far as the temporary increase in the work or the arrears of pending cases were concerned, additional Judges appointed for a period not exceeding two years should assist in disposing of such work. This was the reason why the Law Commission in its Fourteenth Report stated in paras. 54 and 57 of Chap. 6 in Vol. 1:

“54. The large increase in the volume of annual institutions which has been referred to earlier must now, we think, be taken as a permanent feature. This position accordingly necessitates a thorough revision of existing ideas regarding the number of judges required for each High Court. The strength of the High Courts has been increased from, time to time. In doing this, however, the post-Constitutional developments which have thrown a much heavier burden on the High Courts have, in our view, not been adequately taken into account. To expect the existing number of judges in the various High Courts to deal efficiently with the vastly increased volume of work is, in our opinion, to ask them to attempt the impossible. As pointed out to us by a senior counsel, if there is a congestion on the roads due to an increase in traffic, the remedy is not to blame the traffic but to widen the roads.

The first essential, therefore, is to see that the strength of every High Court is maintained at a level so as to be adequate to dispose of what may be called its normal institutions. The normal strength of a High Court must be fixed on the basis of the average annual institutions of all types of proceedings in a particular High Court during the last three years. This is essential in order to prevent what may be termed the current file of the Court falling into arrears and adding to the pile of old cases. The problem of clearing the arrears can be satisfactorily dealt with only after the normal strength of each Court has been brought up to the level required to cope with its normal institutions. We suggest that the required strength of the High Court of each State should be fixed in consultation with the Chief Justice of that State, and the Chief Justice of India and the strength so fixed should be reviewed at an interval of two or three years. Such a review, will be necessary not only by reason of changing conditions but because the implementation of our recommendations made elsewhere will lead to a quicker disposal of work in the subordinate Courts which in its turn will result in an increase in the work of the High Courts.

37.  We are of the view that the provisions of Article 224 of the Constitution should be availed of and additional judges be appointed for the specific purpose of dealing with these arrears. The number of such additional judges required for each High Court for the purpose of dealing with the arrears will have to be fixed in consultation with the Chief Justice of India and the Chief Justice of the State High Court after taking into consideration the arrears in the particular Court, their nature and the average disposal of that Court. The number of additional judges to be fixed for this purpose should be such as to enable the arrears to be cleared within a period of two years. The additional judges so appointed should, in our view, be utilised as far as possible exclusively for the purpose of disposing of arrears and not be diverted to the disposal of current work Pari passu with the disposal of the arrears, the permanent strength of the High Court will have to be brought up to and maintained at the required level, care being taken to see that their normal disposal keeps pace with the new institutions and that they are not allowed to develop into arrears. The appointment of additional Judges for the exclusive purpose of dealing with the arrears is, in our view, called for in a large number of High Courts.”

The sentence underlined by us in para 57 clearly shows that according to the Law Commission also the intendment of Cl. (1) of Art. 224 was that sufficient number of additional Judges would be appointed “so as to enable the arrears to be cleared off within a period of two years.” The same note was struck by. P. N. Sapru when he said in the course of the Debates in Rajya Sabha during the discussion of the Constitution (Seventh Amendment) Bill; “It is necessary to have additional Judges for the disposal of arrears. These arrears, I hope, represent a temporary situation …………….. once these arrears have been cleared off, it will be possible for us to fix or to determine the permanent strength of our Courts with some degree of assurance.” Now it is obvious that if additional Judges were appointed according to the true intendment of Cl. (1) of Art. 224, they would be temporary Judges appointed for a short duration to clear off the arrears and once the arrears are cleared off, which was expected by Parliament to be achieved within not more than two years they would on the expiration of their term, go back to the Bar or to the District Judicial Service. Their tenure being for a short period limited by the time expected to be taken in clearing off the arrears – such time, in any event, being hopefully not more than two years – they would know that, on the expiration of their term, they would have to go back They would have no right to be appointed or even to be considered for appointment as permanent Judges, because when they accepted appointment as additional Judges under Cl, (1) of Art. 224, they would have known that they were appointed only as temporary Judges for a short period in order to clear off the arrears.

37.  But what happened in practice was that the true intendment and purpose of Cl (1) of Art. 224 was never carried into effect. The Government did not increase the strength of permanent Judges in different High Courts adequately so as to be able to cope with the normal institutions. Though the Law Commission had recommended in its Fourteenth Report that the normal strength of a High Court must be fixed on the basis of average annual institution of all types of proceedings in the High Court during the last three years, this recommendation was not heeded with the result that even the current institutions in many of the High Courts could not be disposed of by the inadequate number of permanent Judges and they started adding to the existing arrears. Of course, it was not only the Government which was responsible for not increasing adequately the strength of permanent Judges but the Chief Justices of many High Courts were also remiss in looking after the interests of their High Courts, inasmuch they too did not ask the Government for increase in the strength of permanent Judges. Wherever the fault may lie and it is not necessary for the purpose of these writ petitions to fix the blame, the consequence was that the arrears in the High Courts started growing menacingly from year to year. The requisite number of additional Judges was also not appointed by the Government though Cl. (1) of Art. 224 clearly contemplated that sufficient number of additional Judges would be appointed in order to clear off the arrears within a period of about two years. The old arrears therefore continued to exist and new arrears were added out of the current file of cases which remained undisposed of by the existing strength of Judges. The strength of additional Judges was not fixed realistically and a much lesser number of additional Judges than required for the purpose of clearing off ,the arrears within a period of about two years were appointed in the different High Courts from time to time with the result that the arrears continued to increase and the need for additional Judges continued to subsist. ‘The’ unfortunate consequence was that the additional Judgeship became a gateway, for entering the cadre of permanent Judges. Whenever a person was appointed as a Judge in a High Court, he would be first appointed as an additional Judge and only when a vacancy occurred in the post of a permanent Judge, he would be confirmed as a permanent Judge in that vacancy in accordance with the seniority amongst the additional Judges. The practice therefore grew up of a person being first appointed as an additional Judge and then being confirmed as a permanent Judge in the same High Court. The Union of India at the instance of the petitioners filed before us a statement showing that in almost all cases barring a negligible few, every person was appointed first as an additional Judge in the High Court and then confirmed as a permanent Judge in the same High Court as soon as a vacancy in the post of a permanent Judge became available to him. The entire object and purpose of the introduction of Cl (1) of Art. 224 was perverted and additional Judges were appointed under this Article not as temporary Judges for a short period who would go back on the expiration of their term as soon as the arrears are cleared off, but as Judges whose tenure, though limited to a period not exceeding two years at the time of each appointment as an additional Judge, would be renewed from time to time until a berth was found for them in the cadre of permanent Judges. By and large, every person entered the High Court judiciary as an additional Judge in the clear expectation that as soon as a vacancy in the post of a permanent Judge became available to him in the High Court he would be confirmed as a permanent Judge and if no such vacancy became available to him until the expiration of his term of office, he would be reappointed as an additional Judge for a further term in the same High Court. Therefore, far from being aware that on the expiration of their term, they would have to go back because they were appointed only as temporary Judges for a short period in order to clear off the arrears – which would have been the position if Cl. (1) of Art. 224 had been implemented according to its true intendment and purpose – the additional Judges entered the High Court judiciary with a legitimate expectation that they would not have to go back on the expiration of their term but they would be either reappointed as additional Judges for a further term or if in the meanwhile, a vacancy in the post of a permanent Judge became available, they would be confirmed as permanent Judges. This expectation which was generated in the minds of additional Judges by reason of the peculiar manner in which Cl. (1) of Art. 224 was operated, cannot now be ignored by the Government and the Government cannot be permitted to say that when the term of an additional Judge expires, the Government can drop him at its sweet will. By reason of the expectation raised in his mind through a practice followed for almost over a quarter of a century, an additional Judge is entitled to be considered for appointment as an additional Judge for a further term on the expiration of his original term and if in the meanwhile, a vacancy in the post of a permanent Judge becomes available to him on the basis of seniority amongst additional Judges, he has a right to be considered for appointment as a permanent Judge in his high Court.

38.  It is clear on a plain reading of Art. 217, Cl. (1) that when an additional Judge is to be appointed, the procedure set out in that article is to be followed, Cl. (1) of Art. 217 provides that “Every Judge” of a High Court shall be appointed after consultation with the Chief Justice of India, the Governor of the State land the Chief Justice of the High Court. The expression “Every Judge” must on a plain natural construction include not only a permanent Judge but also an additional Judge. It is significant to note that whenever the Constitution Makers intended to make a reference to a permanent Judge, they did so in clear and explicit term as in Cl (2) of Art. 224. Moreover, there is inherent evidence in Article 217 Cl, (1) itself which shows that the expression “Every Judge” is intended to take in an additional Judge as well. Cl. (1) of Art. 217 says that “Every Judge …………. shall hold office in case of an additional Judge …………as provided in Art. 224 which clearly suggest that the case of an additional Judge is covered by the opening words “Every Judge”. We may also consider what would be the consequence of construing the word “Every Judge” as meaning only a permanent Judge. On that construction, Cl. (1) of Art. 217 will not apply in relation to appointment of an additional Judge and it would be open to the Central Government under Article 224. Cl. (1) to appoint an additional Judge without consulting any of the constitutional functionary specified in Cl. (1) of Art. 217. This could never have been intended by the Constitution Makers, who made such elaborate provisions in the Constitution for safeguarding the independence of the judiciary. We must therefore, hold that no additional Judge can be appointed without complying with the requirement of cl. (1) of Art. 217.

39.  Now, when the term of an additional Judge expires he ceases to be a Judge and therefore, if he is to continue as a Judge, he must be either reappointed as an additional Judge or appointed as a permanent Judge. In either case, cl. (1) of Art. 217 would operate and no reappointment as an additional Judge or appointment as a permanent Judge can be made without going through the procedure set out in Art. 217 cl. (1). Of course, an additional Judge has a right to be considered for such reappointment or appointment as the case may be, and the Central Government cannot be heard to say that the additional Judge need not be considered. The additional Judge cannot just be dropped without consideration. The name of the additional Judge would have to go through the procedure of cl. (1) Art. 217 and after consultation with the Chief Justice of India, the Governor of the State and the Chief Justice of the High Court, the Central Government would have to decide whether or not to reappoint him as an additional Judge or to appoint him as a permanent Judge. If the procedure for appointment of a Judge followed as a result of a practice memorandum issued by the Central Government is that the proposal for appointment of a Judge may ordinarily originate from the Chief Justice of the High Court and may then be sent to the Governor of the State and thereafter to the Chief Justice of India through the Justice Ministry for their respective opinions before a decision can be taken by the Central Government whether or not to appoint the person proposed, the name of the additional Judge must be sent-up by the Chief Justice of the High Court with his recommendation whether he should be reappointed as an additional Judge or appointed as a permanent Judge or not and it must go up to the Central Government with the opinions of the Chief Justice of India, the Governor of the State and the Chief Justice of the High Court, so that the Central Government may, after considering such opinions, make-up its mind on the question of reappointment or appointment as the case may be. But this is the only right possessed by the Additional Judge. The additional Judge is not entitled to contend that he must automatically and without any further consideration be appointed as an additional Judge for a further term or as a permanent Judge. He has to go through the process of cl. (1) of Art. 217 and to concede to him the right to be appointed either as an additional Judge for a further term or as a permanent Judge would be to fly in the face of Art. 217 cl. (1). If the additional Judge is entitled to be appointed without anything more, why should the process of consultation be gone through in regard to his appointment? Would consultation with the Chief Justice of India, the Governor of the State and the Chief Justice of the High Court not be reduced to a farce? It would be a mockery of consultation with such high constitutional dignitaries. There can, therefore, be no doubt that an additional Judge is not entitled as a matter of right to be appointed as an additional Judge for a further term on the expiration of his original term or as a permanent Judge. The only right he has to be considered for such appointment and this right also belongs to him not because cl. (1) of Art. 224 confers such right upon him, but because of the peculiar manner in which cl. (1) of Art. 224 has been operated all these years.

40.  But the question then arises what are the factors which can legitimately be taken into account by the Central Government in deciding whether or not to reappoint an additional Judge for a further term or to appoint him as a permanent Judge. The argument of the petitioners was that an additional Judge is not on probation. He is as much a Judge as a permanent Judge with the same jurisdiction and the same powers and to treat him as if he were on probation would not only detract from his status and dignity but also affect his independence by making his continuance as a Judge dependent on the good opinion of the Chief Justice of the High Court, the Governor of the State and the Chief Justice of India. We find it difficult to accept this argument in the face of the clear and unambiguous language of cl. (1) of Art. 217. There are no limitations in the language of cl, (1) of Art. 217 as to what factors shall be considered and what factors shall not be, but having regard to the object and purpose of that provision namely, appointment of a High Court Judge, it is obvious that fitness and suitability, physical, intellectual and moral, would be the governing considerations to be taken into account in deciding the question of appointment. Now, when, on the expiration of the term of an additional Judge, the Central Government is again called upon to consider whether or not he should be re-appointed as an additional Judge or appointed as a permanent Judge, the Central Government would have to apply its mind to the question whether such additional Judge possesses the requisite fitness and suitability for being reappointed or appointed as the case may be. Public interest requires that only such person should be appointed as a Judge who is physically, intellectually and morally fit and suitable to be appointed as a Judge and it would be contrary to public weal to appoint a person, who does not possess the requisite fitness and suitability. The Central Government would therefore be under a constitutional obligation to consider whether the additional Judge, whose term has expired, is fit and suitable to be reappointed as an additional Judge or appointed as a permanent Judge. How can cl. (1) of Art. 217 or Art. 224 be so interpreted as to require the Central Government to reappoint an additional Judge for a further term or to appoint him as permanent Judge, even if at the time of such reappointment or appointment as the case may be, he is physically, intellectually or morally unfit or unsuitable to be appointed as a Judge. Of course, at the time when the question of reappointment of an additional Judge for a further term or his appointment as a permanent Judge comes up before the Central Government for consideration, the additional Judge would have two weighty circumstances in his favour; one, that he has experience as a Judge for one term and the other, that it would not be desirable to send an additional Judge back to the Bar. But even with these weighty circumstances in his favour, he would have to satisfy the test of fitness and suitability, physical, intellectual and moral, before the Central Government can, consistently with its constitutional obligation and in public interest, decide to reappoint him as an Additional judge or appoint, him as a permanent Judge. It is true that the fitness and suitability of the additional Judge must have been considered by the Central Government at the time of his original appointment, but when the question again comes up for consideration on the expiration of his term, the Central Government has to consider afresh, in the light of the material then available, as to whether he possesses the requisite fitness and suitability for being appointed as a Judge. It would not be right to say that merely because the fitness and suitability of the additional Judge is required to be considered again for the purpose of deciding whether he should be reappointed for a further term or appointed as a permanent Judge, it would amount to treating him as if he were on probation. An additional Judge is certainly not on, probation in the sense that his service cannot be terminated before the expiration of his term, unlike a probationer who can be sent out any time during the period of probation. It would also not be open to the Chief Justice of the High Court or the Governor of the State or the Chief Justice of India to sit in judgment over the quality of the work turned out by the additional Judge during his term, because that would be essentially an appellate function which can be discharged only by the court entitled to hear appeals from the decisions of the additional Judge. But every other consideration which bears on the physical, intellectual and moral fitness and suitability of the additional Judge can and must be considered and if the Central Government finds, after consultation with the Chief Justice of the High Court, the Governor of the State and the Chief Justice of India that the additional Judge is not fit and suitable for being appointed as a Judge, the Central Government may decide not to appoint him as an additional Judge for a further term or as a permanent Judge. So long as the case of the additional Judge is considered by the Central Government for reappointment or appointment as the case may be, the decision of the Central Government cannot be questioned except on the ground that it was reached without full and effective consultation with the Chief Justice of the High Court, the Governor of the State and the Chief Justice of India or that was based on irrelevant considerations.

41.  There was also one other argument advanced by the learned Attorney General and it was that where an additional Judge is not appointed for a further term or as a permanent judge, he cannot challenge the decision of the Central Government not to appoint him, because Cl. (1) of Art. 217 prescribes the procedure to be followed only where an appointment is made and it has no application where an appointment is not made. This argument is, in our opinion, without force and must be rejected. An additional Judge, as we have pointed out, has a right to be considered for appointment as an additional Judge for a further term or in case there is a vacancy in a permanent post then for appointment as a permanent Judge, and he must therefore, be considered by the Government for such reappointment or appointment as the case may be, and a decision must be taken in regard to him after consultation with Chief Justice of the High Court, the Governor of the State and the Chief Justice of India, and if it is found that there was no consultation with any of these three constitutional functionaries before the decision was taken by the Central Government not to appoint him or the decision of the Central Government is based on irrelevant grounds, it would not be, consideration by the Central Government as required by Cl, (1) of Art. 217 and he would, therefore, be entitled to challenge the decision of the Central Government which is based on what may be called ‘non-consideration in law’ and to require the Central Government to reconsider his case in accordance with Cl. (1) of Art. 217. This consequence would follow only because an Additional Judge has a right to be considered for appointment as an additional Judge for a further term or as a permanent Judge. No person, who is proposed for initial appointment as a Judge would be entitled to complain against the decision of the Central Government not to appoint him, because he would have no right to be considered for appointment as a Judge.

42.  We must also deal with the argument of the petitioners that so long as there is a post of a permanent Judge vacant, no appointment of an additional Judge can be made under Cl. (1) of Article 224. It is clear from the language of Cl. (1) of Art. 224 that it is, only where permanent Judges of a High Court are unable to cope with the current institutions and the increased business or the arrears of pending cases and it is found necessary for the purpose of disposing of the increased business or the arrears of pending cases to increase the strength of the Judges of the High Court for the time being that additional Judges can be appointed. Clause (1) of Article 224 contemplates appointment of additional Judges to augment the strength of the existing Judges. It must therefore follow logically that there must be full strength of existing Judges before additional Judges can be appointed and so long as any post of existing Judges is not filled up, there, can be no question of appointing additional Judges to augment their strength. When there is a vacancy in the post of a permanent Judge, it must first be filled up before any additional Judge can be appointed under Cl. (1) of Art. 224. It is therefore, necessary that the Central Government must periodically review the strength of permanent Judges in each High Court, so that there is a proper and adequate strength for the purpose of dealing with the normal institutions. Since there are large arrears pending almost in every High Court and it is not humanly possible to dispose of these arrears within a measurable distance of time even by appointment of additional Judges, we think it necessary that instead of appointing additional Judges for the purpose of disposing of the arrears, it would be desirable to increase the strength of permanent Judges because the arrears have come to stay and we do not think it is possible to wipe them out for a long period of time. We are glad that towards the close of the arguments Mr. Mridul submitted to us a statement on behalf of the Central Government assuring us that:

“The Union Government has decided to increase the number of posts of permanent Judges in the various High Courts keeping in view the load of work, the guidelines prescribed and other relevant considerations. In fact in 1980 itself, on the basis of institution, disposal and arrears of cases and the guidelines prescribed, the Governments of seven States where the problem was more acute, had been addressed to consider augmentation of the Judge strengths of their High Courts. It has been decided that where necessary the guidelines prescribed will be suitably relaxed by taking into account local circumstances, the trend of litigation and any other special or relevant factors that may need consideration. The Union Government will take up the matter with the various State Governments so that after consulting the Chief Justices of the High Courts, they expeditiously send proposals for the conversion of a substantial number of posts of Additional Judges into those of Permanent Judges.”

We hope and trust that the Central Government will soon take the necessary steps to increase realistically the strength of permanent Judges in each High Court.


  • The System of appointment of additional Judges was  in vogue when the Constituent Assembly met to frame the Constitution.

  • So long as there is a post of a permanent Judge vacant, no appointment of an additional Judge can be made under Cl. (1) of Article 224.

  • when the term of an additional Judge expires he ceases to be a Judge and therefore, if he is to continue as a Judge, he must be either reappointed as an additional Judge or appointed as a permanent Judge.

Maharao Saheb Shri Bhim Singhji Versus Union of India and others

SUPREME COURT OF INDIA JUDGMENTS

AIR 1981 SC 234 : (1981) 1 SCC 166

SUPREME COURT OF INDIA

Maharao Saheb Shri Bhim Singhji Versus Union of India and others

(Before : Y. V. Chandrachud, C.J.I., P. N. Bhagwati, V. R. Krishna Iyer, V. D. Tulzapurkar And A. P. Sen, JJ.)

Writ Petitions Nos 350, 441-453; 755; 753-754 of 1977 and 3123 to 3125 of 1978 , Decided on : 13-11-1980.

Urban Land (Ceiling and Regulation) Act, 1976—Section 23—Private property cannot under our Constitution be acquired or allotted for private purposes though an enabling power like that contained in sub-section (1) of Section 23 may be exercised in cases where the common good dictates the distribution of excess vacant land to an industry, as defined in Cl. (b) of the Explanation to Section 23.

JUDGMENT

1. We hold that the entire Urban Land (Ceiling and Regulation) Act of 1976 is valid save and except Section 27 (1) insofar as it imposes a restriction on transfer of any urban or urbanisable land with a building or of a portion of such building, which is within the ceiling area.

2. Chandrachud. C. J.—We have perused the judgment prepared by Brother Tulzapurkar with care but, with respect we are unable to agree with him that the Urban Land Ceiling and Regulation) Act, 33 of 1976, does not further the Directive Principles of State Policy in Clauses (b) and (c) of Art. 39 of the Constitution. The vice from which a provision here or a provision there of the impugned Act may be shown to suffer will not justify the conclusion that the Act is not intended to or does not, by its scheme, in fact implement or achieve the purposes of Clauses (b) and (c) of Art. 39.

3. The definition of ‘family’ in Section 2 (f), which in relation to a person means the individual, the wife or husband, as the case may be, of such individual mid their unmarried minor children, will not necessarily lead to concentration of wealth in the hands of a few persons or families. Such is not the intendment, nor the drive, nor the direct and inevitable consequence of the aforesaid definition of ‘family’.

4. Section 23 of the Act is in our opinion valid and does not suffer from any constitutional infirmity. The definition of the word ‘industry’ in Cl. (b) of the Explanation to that section is undoubtedly unduly wide since it includes “any business, profession, trade, undertaking or manufacture”. If sub-section (1) of S. 23 were to stand alone, no doubt could have arisen that the Urban Land Ceiling Act is a facade of a social welfare legislation and that its true, though concealed, purpose is to benefit favoured private individuals or associations of individuals. But the preponderating provision governing the disposal of excess vacant land acquired under the Act is the one contained in sub-section (4) of Section 23 whereby, all vacant lands deemed to have been acquired by the State Government under the Act “shall be disposed of……………. to subserve the common good”. The provisions of sub-section (4) are “subject to the provisions of sub-sections (1), (2) and (3)’ but the provisions of sub-section (1) are enabling and not compulsive and those of sub-sections (2) and (3) are incidental to the visions of sub-section (1). The disposal of excess vacant lands must there fore be made strictly in accordance with the mandate of sub-section (4) of Section 23, subject to this, that in a given case such land may be allotted to any person, for any purpose relating to, or in connection with, any ‘industry’ or for the other purposes mentioned in sub-sec. (1), provided that by such allotment, common good will be subserved. The governing test of disposal of excess land being ‘social good’, any disposal in any particular case or cases which does not subserve that purpose will be liable to be struck down as being contrary to the scheme and intendment of the Act. The Preamble to the Act ought to resolve interpretational doubts arising out of the defective drafting of Section 23. It shows that the Act was passed with the object of preventing concentration of urban land in the hands of a few persons and with a view to bringing about an equitable distribution of land in urban agglomerations to subserve the common good. ‘Common good’ being the writing on the wall, any disposal which does not serve that purpose will be outride the scope of the Act and therefore lacking in competence in diverse senses, Private property cannot under our Constitution be acquired or allotted for private purposes though an enabling power like that contained in sub-section (1) of Section 23 may be exercised in cases where the common good dictates the distribution of excess vacant land to an industry, as defined in Cl. (b) of the Explanation to Section 23.

5. Section 11 (6) which provides that the amount payable under sub-section (1) or sub-section (5) of Section 11 shall, in no case, exceed two lakhs of rupees is valid. The amount thus payable is not illusory and the provision is not confiscatory. Rupees two lakhs is not like a farthing even if the excess land may be a fortune.

Finally, we are of the opinion that sub-section (1) of Section 27 of the Act is invalid in so far as it imposes a restriction on transfer of urban or urbanisable land with a building or a portion only of such building, which is within the ceiling area. Such property will therefore be transferable without the constraints mentioned in sub-section (1) of Section 27 of the Act.

6. The Writ Petitions are accordingly dismissed except for the restricted striking down of Sec. 27 (1) of the Act. There will be no order as to costs.

Fuller reasons will follow later.

7. Krishna Iyer, J—I agree with the learned Chief justice both regarding the constitutionality of the legislation and regarding the partial invalidation of Section 27 (1). Nevertheless, I consider it necessary to strike a few emphatic notes of concordance having special regard to the discordance of my learned brother Tulzapurkar, J. I have carefully perused the judgment of Tulzapurkar, J. but must express my deferential disagreement because on a few fundamentals there is sharp divergence between us.

8. I proceed to turn the focus only on three issues, namely, the alleged artificiality of ‘family’ as defined in S. 2 (f) of the Urban Land (Ceding and Regulation) Act, 1976 (for short, the Act), the invalidity of S. 23 of the Act as discriminatory and, therefore, unconstitutional and the invalidity of S. 11 (6) of the Act on the score that the compensation offered is illusory and, therefore, violative of Art. 31 (2) of the Constitution.

9. The legislation, as its title indicates, is obviously a measure for inhibiting concentration of urban lands in the hands of a few persons and for equitable distribution of such land to subserve the common good. Article 39 (b) and (c) of the Constitution are directly attracted and there is no doubt that the fullest exploitation of the material resources of the community undoubtedly requires distribution of urban land geared to the common good. It is also a notorious fact that concentration of urban land in private hands is an effective forbiddance of the maximum use of such land for industrial purposes at a critical juncture when the nation is fighting for survival through industrialisation. It needs no argument to conclude that the objective of the legislation as set out in the long title and in the statutory scheme is implementation of Part IV of the Constitution. The Directive Principles of State Policy being paramount in character and fundamental in the country’s governance, distributive justice envisaged in Art. 39 (b) and (c) has a key role in the developmental process of the socialist Republic that India has adopted. The conclusion is inevitable that as a broad measure of State policy, ceiling and regulation of urban land ownership is an imperative of economic independence and is, therefore, on the national agenda of planned development. Indeed, there was no controversy on this question before us. One of the points which has been argued and has found approval with my learned brother Tulzapurkar, J., turns on the gross inadequacy of compensation fixed under S. 11. (6) of the Act. There is a specific case before us that urban land worth a few crores of rupees will fall a pray to acquisition under this Act, but thanks to S. 11 (6), “the amount” payable in return to the owner shall not exceed ` 2 lakhs. This, it is contended, is an illusory compensation in reckless disregard of the market value of the property acquired. I am unable to agree with this submission.

10. The taking over of large conglomerations of vacant land is a national necessity if Art. 39 is a constitutional reality. “Law can never be higher than the economic order and the cultural development of society brought to pass by that economic order.” (Marx). Therefore, if Art. 38 of the Constitution which speaks of a social order informed by economic justice, is to materialise, law must respond effectively. and rise to the needs of the transformation envisioned by the founding fathers. But it is contended that any legislation which violates Art. 31 (2) or Art. 19 (1) (f) (both of them have since been deleted by the 44th Amendment to the Constitution although on the relevant date they were part of Part III) must fail notwithstanding the fact that Arts. 31B and 31C shield the legislation in question. It is said that the Act is vulnerable for the reason that right to property armored by the above two Articles is inviolable unless the taking is for a public purpose in contrast to a private industry and the payment in return, even if not an equivalent, is to be fair enough so as not to be castigated as illusory. The various amendments to Art 31 culminating in the present provision which provides for the payment of an “amount” disclose a determined approach by parliament in exercise of its constituent power to esure that full compensation or even fair compensation cannot be claimed as a fundamental right by the private owner and that short of paying a ‘farthing for a fortune’ the question of compensation is out of bounds for the court to investigate.

11. The question is whether in the light of Kesavananda Bharati (1973) 4 SCC 225 at page No. 959 (especially the observations of Chandrachud, J.), a sum of ` 2 Lakhs in Section 11 (6) is a farthing for a fortune. I repudiate the proposition that payment of a sum of ` 2 lakhs, whatever the total value of the property in the market may be is so fictitious and flimsy as to be a farthing. There are no absolutes in law as in life and the compulsions of social realities must unquestionably enter the judicial verdict. What is the dimension of Indian penury? What is the basis of our constitutional order? What is the goal of the Republic? What is the meaning of the egalitarian ethos of our society? What do we mean by “We, the People of India”? Unless these profound roots of our social constitutional order are probed, we can never reach an effective answer to legal formal issues. The roots and fruits of our National charter depend on a clear grasp of the constitutional fundamentals. In this context, it is important to remember that, right at the beginning even as the proceedings of the Constituent Assembly were culminatings, Nehru had warned:

If we cannot solve this problem soon, all our paper constitutions will become useless and purposeless. If India goes down, all will go down, if India thrives all will thrive; and if India lives, all will live.

He had repeated with emphasis:

The first task of this Assembly is to free India through a new constitution, to feed the starving people, and to clothe the naked masses, and to give every Indian the fullest opportunity to develop himself according to his capacity.

Indeed, the tryst with that India made when it became free found expression in a historic speech by the then Prime Minister, Jawahar Lal Nehru:

The service of India means the service of the millions who suffer. It means the ending of poverty and ignorance and disease and inequality of opportunity. The ambition of the greatest man of our generation has been to wipe every tear from every eye. That to may be beyond us, but as long as there are tears and suffering, so long our work will not be over.

12. We must notice the Indian human condition. “Indian poverty, to many who have an acquaintance with poverty in similar societies, is unique”. writes Segal in his book The Crisis of India:

“It is unique in its depths, which seem incapable of supporting life at all; unique in its blatancy, for it is everywhere, in city and village, and concealed among chimneys or trees, not isolated like an epidemic in an inaccessible slum, but everywhere, on the movement of ones feet, always somewhere in the circle of one’s sight; unique in its sheer magnitude, for in India the poor are not to be numbered in hundreds of thousands, but in hundreds of millions; unique in the quality of its submission, which registers a kind of glazed pride.” In this context we may also read what Rajen Babu stated as a framer of the Constitution:

To all we give the assurance that it will be our endeavour to end poverty and squalor and its companions, hunger and disease, to abolish distinctions and exploitation and to ensure decent conditions of living”.

We may have to remember that a galaxy of Constitution makers like Sardar Patel and G. B. Pant and Rajagopalachari, not to speak of Jawahar Lal Nehru, were doubtful about the court being given the power to pronounce upon the question of compensation when the State acquired property. Indeed, it is revealing to read the debates in condensed form given by Granville Austin:The Indian Constitution Cornerstone of a Nation p. 88.

13. Sardar Patel closed the debate with a speech that sounded like a requiem for lanllords…………. What did ‘public use’ mean, he wondered. Pant then said:Suppose the Government acquires zamindari rights and then abolishes them. Or what if the Government takes-over Connaught Place (the central shopping and office area of New Delhi) and then redistributes the buildings to the tenants. The first stage is acquisition. Does that come under this clause? To Ayyar’s answer of “Certainly’ Pant replied that he opposed the wording if it means that the Government would not be free to determine the compensation it would have to pay. If this clause covers all cases of acquisition, said Rajagopalachari, then the question of the justness of compensation will go to the court ‘with the result that Government functioning will be paralysed’……………..Panikkar suggested that they should take out the ‘just’ so that it would not be justiciable. Pant replied that if this covered acquistion for social purposes. ‘then I submit payment of compensation should not even be compulsory’. Patel concluded the discussion. ‘If the word ‘just’ is kept’, lie said, ‘we came to the conclusion that every case will go to the Federal Court. Therefore “just” is dropped …… The Assembly greeted the committee’s actions favourably.

We need not go into the details except to state that even Gandhiji took the view that anything like compensation could possibly not be given when property was taken from the property owners by the State for community benefit. I mention this only to drive home the point that right to property is not part of the basic structure of the Constitution even as right to poverty is not the basic structure of India forever. The whole adventure of the Constitution is to remove poverty and in that process remove concentration of property, not for a return, but for almost free, if the justice of the situation commended itself to the legislation to take it that way. See Granville Austin, The Indian Constitution:Cornerstone of a Nation, p. 89. Of course, it may be a deception to say that an “amount” is paid if nothing is paid except a tittle. So, what we have to consider is whether the amount of ` 2 lakhs is so utterly deceptive and totally nominal as to be discarded as a farthing with contempt. Having regard to the human condition of a large percentage of pavement dwellers and slum dwellers in our urban areas and proletarian miserables in our rural vastnesses, any one who gets ` 2 lakhs can well be regarded as having got something substantial to go by. In a society where half of humanity lives below the breadline, to regard ` 2 lakhs as a farthing is farewell to poignant facts and difficult to accept. In my view, with the greatest respect for my learned brother, I am unable to assent to the view that S. 11 (6) contravenes Art. 31 (2) because the payment stipulated is a mere mockery.

14. To put a ceiling on the maximum amount payable when property is taken is reasonable and does not spell discrimination unless the maximum itself is a hoax, being trivial. In a Constitution which creates a Socialist Republic egality is the rule of life and where gross inequalities mar the economic order, a measure of equalisation is but one strategy of promoting equality and has to be viewed as part of the dynamics of social justice. Indeed, even in the Income Tax Act, at a certain stage, almost all the income is taken away by a steep rate of tax leaving next to nothing to the income earner. We have to be pragmatic and show empathy with the values of the Constitution. Chief justice Earl Warren’s statement is apposite as a reminder to our judicial conscience:Fortune, November 1955.

Our judges are not monks or scientists, but participants in the living stream of our national life, stearing the law between the dangers of rigidity on the one hand and of formlessness on the other. Our system faces no theoretical dilemma but a single continuous problem:how to apply to ever-changing conditions the neverchanging principles of freedom.

I have no hesitation in holding S. 11 (6) as invulnerable.

15. ‘Family’ as defined in S. 2 (f) has been held invalid by my learned brother Tulzapurkar, J., as an arbitrary, artificial creation of the statute inconsistent with the natural unit prevalent in the country. Here again, I must emphasise that law is never static and must respond to the challanges of change; William J. Brennan Jr.:Opinion, Roth v. United States (1957) 354 US 476.

The law is not an end in itself, nor does it provide ends. It is pre-eminently a means to serve what we think is right…. Law is here to serve! To serve what? To serve, insofar as law can properly do so, within limits that I have already stressed, the realization of man’s ends, ultimate and mediate …. Law cannot stand aside from the social changes around it.

It is possible that in the last century the prevalent concept of family was of a certain pattern. Indeed, in the diversity of Indian social structure the concept of ‘family’ has varied from region to region and even from community to community and we cannot postulate any parameters in this behalf. Moreover, fission, not fusion, is the modem trend and whatever might have been the situation in Indian rural life in the 1950s there is no doubt that nuclear families are becoming the vogue in the late 1970s and 1980s of Indian urban life. In the Western countries the family unit consists of the parents and their minor children and the West has invaded the East in life-style at least in our cities. Whatever may be the pastoral life of old or the idyllic picture we may cherish the social facts tell a different tale in contemporary India of the cities. There is hardly space for a nuclear family to live in urban conditions and to think of large joint families as the natural unit is to resurrect bygone ways of life and turn the blind eye to the rapid growth of the small family of man and wife – ‘we two and we shall have two’ is the desideratum and social factum. In these days of family planning and self-reliance of the adult we cannot condemn as arbitrary, by a process of judicial ratiocination, the legislative provision that a family shall be defined as the parents plus their minor children. I, therefore, old that ‘family’ as defined in S. 2 (f) of the Act accords with the current life-style in urban conditions and is neither artificial nor arbitrary nor violative of Article 14. It is noteworthy that many agrarian legislations have been upheld by this court in a spate of recent cases where the definition of ‘family’ is substantially the same.

16. I may permit myself a few observations on S. 23 of the Act for the grounds of invalidation relied on by the challengers. The section has been loosely or ambivalently drafted and runs thus:

Section 23. Disposal of vacant land acquired under the Act.-

(1) It shall be competent for the State Government to allot, by order. in excess of the ceiling limit any vacant land which is deemed to have been acquired by the State Government under this Act or is acquired by the State government under any other law, to any person for any purpose relating to, or in connection with, any industry or for providing residential accommodation of such type as may be approved by the State Government to the employees of any industry and it shall be lawful for such person to hold such land in excess of the ceiling limit.

Explanation- For the purposes of this section, –

(a) where any land with a budding has been acquired by the State Government under any other law and such building has been subsequently demolished by the State Government, then, such land shall be deemed to be vacant land acquired under such other law;

(b) “industry” means any business, profession, trade, undertaking or manufacture.

**********

(4) Subject to the provisions of sub-sections (1), (2) and (3), all vacant lands deemed to have been acquired by the State Government under this Act shall be disposed of by the State Government to subserve the common good on such terms and conditions as the State Government may deem fit to impose.

17. Certain basics must be remembered as ideological tools of legal interpretation. The purpose of the enactment, garnered from the preamble, is to set a ceiling on vacant urban land, to take over the excess and to distribute it on a certain basis of priority. The whole story of the legislation, the long gestation of prelegislative consideration, the brooding presence of Art. 39 (b) and (c) and the emphasis in S. 23 (4) on common good as the guiding factor for distribution point to public purpose, national development and social justice as the cornerstone of the policy of distribution. It is not and never can be compulsory taking from some private owners to favour by transfer other private owners. The prevalent pathology of corrupt use of public power cannot be assumed by the court lest the same charge be levelled against its echelons. The wide definition of ‘industry’ or the use of general words like ‘any person’ and ‘any purpose’ cannot free the whole clause from the inarticulate major premise that only a public purpose to subserve the common good and filling the bill of Art. 39 (b) and (c) will be permissible. Even a private industry may be for a national need and may serve common good. Even a medical clinic, legal aid bureau, engineering consultant’s office, private ambulance garage, pharmacist’s shop or even a funeral home may be a public utility. Professions for the people, trade at the service of the community and industry in the strategic sector of the nation’s development may well be in private hands in the transitional stage of our pluralist economy undergoing a fabian transformation. Why should lands allotted to such private industries or professionals be condemned? The touchstone is public purpose, community good and like criteria. If the power is used for favouring a private industrialist or for nepotistic reasons the oblique act will meet with its judicial Waterloo. To presume as probable graft, nepotism, patronage, political clout, friendly pressure or corrupt purpose is impermissible. The law will be good, the power will be impeccable but if the particular act of allotment is mala fide or beyond the statutory and constitutional parameters such exercise will be a casualty in court and will be struck down. We must interpret wide words used in a statute by reading them down to fit into the constitutional mould. The confusion between the power and its oblique exercise is an intellectual fallacy we must guard against. Fanciful possibilities, freak exercise and speculative aberrations are not realistic enough for constitutional invalidation. The legislature cannot be stultified by the suspicious improvidence or worse of the Executive.

18. I wholly agree with the perspective of my learned brother Sen, J. that Part IV which seeks to build a Social justice Society, is basic to out constitutional order. Any transgression of Art. 39 (b) and (c) is beyond the scope of S. 23 (1) and disposal of land thereunder must subserve the common good and not the reverse. This limitation on the wide words of S. 23 (1) is a matter of semantics and reading down meanings of words with loose lexical amplitude is permissible as part of the judicial process. To sustain a law by interpretation is the rule. To be trigger-happy in shooting at sight every suspect law is judicial legicide. Courts can and must interpret words and read their meanings so that public good is promoted and power misuse is interdicted. As Lord Denning said:

“A judge should not be a servant of the words used. He should not be a mere mechanic in the powerhouse of semantics”. May Lord Denning live long, and his shadow never grow lessl” “Lawyer” October 1980 Silver Jubilee Issue p. 172.

19. The power of judicial review to strike at excess or mala fides is always there for vigilant exercise untrammelled by the narrow precedents of Victorian vintage. Prof. H.W.R. Wade’s note of judicial activism, in his recent Hamlyn Lectures, will set the sights right:Hamlyn Lectures (32nd series) Constitutional Fundamentals.

Brainwashed though British lawyers are in their professional infancy by the dogma of legislative sovereignty, they ought to excuse rather than criticise the logical contortions and evasions to which judges must resort in their struggle to preserve their powers. I do not see how they can fairly be accused, to borrow words used by Lord Devlin, of moving too far from their base. They would be much more open to criticism if they remained content with the wretchedly narrow base to which they confined themselves 30 years ago, when they took clauses of the “if the minister is satisfied” type at face value. For judicial control, particularly over discretionary power, is a constitutional fundamental. In their self-defensive campaign the judges have almost given as a constitution, establishing a kind of entrenched provision to the effect that even Parliament cannot deprive them of their proper function. They may be discovering a deeper constitutional logic than the crude absolute of statutory omnipotence.

20. I have no doubt that even the crude drafting of S. 23 (4) by the unwanted ‘subject to’ will not whittle down the power, why, the obligation, to distribute vacant land, not according to personal, political or official fancy but strictly geared to the good set down in Article 39 (b) and (c).

21. The question of basic structure being breached cannot arise when we examine the vires of an ordinary legislation as distinguished from a constitutional amendment. Kesavananda Bharati (1973) 4 SCC 225 cannot be the last refuge of the Proprietariat when benign legislation takes away their ‘excess’ for societal weal. Nor, indeed, can every breach of equality spell disaster as a lethal violation of the basic structure. Peripheral inequality is inevitable when large-scale equalisation processes are put into action. If all the judges of the Supreme Court in solemn session sit and deliberate for half a year to produce a legislation for reducing glaring economic inequality their genius will let them down if the essay is to avoid even peripheral inequalities. Every large cause claims some martyr, as sociologists will know. Therefore, what is a betrayal of the basic feature is not a mere violation of Art. 14 but a shocking, unconscienable or unscrupulous travesty of the quintessence of equal justice. If a legislation does go that far it shakes the democratic, foundation and must suffer the death penalty. But to permit the Bharati (1973) 4 SCC 225 ghost to haunt the corridors of the court brandishing fatal writs for every feature of inequality is judicial paralysation of parliamentary function. Nor can the constitutional fascination for the basic structure doctrine be made a Trojan horse to penetrate the entire legislative camp fighting for a new social order and to overpower the battle for abolition of basic poverty by the ‘basic structure’ missile. Which is more basic? Eradication of die-hard, deadly and pervasive penury degrading all human rights or upholding of the legal luxury of perfect symmetry and absolute equality attractively to preserve the status quo ante? To use the Constitution to defeat the Constitution cannot find favour with the judiciary! I have no doubt that the strategy of using the missile of ‘equality’ to preserve die hard, dreadful societal inequality is a strategem which must be given short shrift by this court. The imperatives of equality and development are impatient for implementation and judicial scapegoats must never be offered so that those responsible for stalling economic transformation with a social justice slant may be identified and exposed of, Part IV is a basic goal of the nation and now that the court upholds the urban ceiling law, a social audit of the Executives implementation a year or two later will bring to light the gaping rap between verbal valour of the statute took and the executive slumber of law-in-action. The court is not the anti-hero in the tragedy of land reform, urban and agrarian.

22. After all, in a rapidly changing society running on the rails of the rule of law and operated according to constitutional paradigms, the proprietariat is bound to suffer but the country cannot defer the transformation because, then, hunger will know no law. This is the root of the matter. And then comes the irony of continual litigative clamour and the periodic chorus for property:Tennyson, Northern Farmer. 1869.

Dosn’t thou ‘ear my ‘erse’s, as they canters away?

Proputty, proputty, proputty – that’s

what I ‘ears ‘em saay

And holders and hoarders of wealth may pensively reflect:Robert G. Ingersoll:Speech, N. Y. C. October 29, 1896.

Few rich men own their own property. The property owns them.

23. I have not had the privilege nor advantage of my learned brothers’ full judgments save some discussions but my impending retirement impels a hurried recording of my reasons for subscribing to the order passed just now. ‘Tomorrow to fresh woods and pastures new’, but today must be fulfilled, before tomorrow arrives, and so, I deliver this judgment as is my duty to do.

24. Tulzapurkar, J—By these writ petitions the petitioners, who are holders of vacant land in the urban agglomerations in various States, are seeking to challenge the vires of some of the salient provisions of the Urban Land (Ceiling and Regulation) Act. 1976 (33 of 1976) and since, according to them, some of the impugned provisions are pivotal and non-severable, having an impact on its entire scheme, the whole Act is liable to be struck down as being invalid and unconstitutional. The petitioners have, therefore, prayed for an order quashing notices issued to them by the concerned competent authorities under the Act and a mandamus directing the respondents not to implement the provisions thereof against them.

25. The impugned enactment has its genesis in the resolutions passed by eleven sponsoring States under Art. 252 (1) of the Constitution. The State Legislatures of Andhra Pradesh, Gujarat, Haryana, Himachal Pradesh, Karnataka, Maharashtra, Orissa, Punjab, Tripura, Uttar Pradesh and West Bengal considered it desirable to have an uniform legislation enacted by Parliament for the imposition of ceiling on urban property for the country as a whole and as required by the first part of Art. 252 (1) of the Constitution passed a resolution to that effect. Parliament accordingly enacted the Urban Land (Ceiling and Regulation) Act, 1976. It received the assent of the President on February 17, 1976 and, in the first instance, it came into force on that day in all the Union Territories and the 11 States which had passed the requisite resolution under the first part of Art. 252 (1). Subsequently, the Act was adopted, by passing resolutions under the second part of Art. 252 (1) by the State Legislatures of Rajasthan on March 9, 1976, Manipur on March 12, 1976, Assam on March 25, 1976, Bihar on April 1, 1976, Meghalaya on April 7, 1976 and Madhya Pradesh on September 9, 1976. Thus, the enactment is in force in 17 States and all the Union Territories in the country. It seeks to impose ceiling on vacant lands in urban agglomerations having a population of two lakhs or more and for that purpose classifies such urban agglomerations in various cities and towns in all the States and Union Territories into four categories and fixes the ceiling limit for each of the categories thus:Ceiling limit on vacant land is fixed at 500 sq. metres for the urban agglomerations of the metropolitan areas of Delhi, Bombay, Calcutta and Madras having a population exceeding ten lakhs falling under category ‘A’, at 1,000 sq. metres for urban agglomerations with a population of ten lakhs and above, excluding the four metropolitan areas, falling under category ‘B’, at 1,500 sq. metres for urban agglomerations with a population between three lakhs and ten lakhs falling under category ‘C’ and at 2,000 sq. metres for urban agglomerations with a population between two lakhs and three lakhs falling under category ‘D’, vide S. 4 read. with Schedule I of the Act. The said Schedule does not mention the urban agglomerations having a population of one lakh and above but if a particular State which passed a resolution under Art. 252 (1) (first part) or if a State which subsequently adopts the Act by passing a resolution under Art. 252 (1) (second part) wants to extend the Act to such areas it could do so by a Notification under Section 2 (n) (A) (ii) or S. 2 (n) (B), as the case may be, after obtaining the previous approval of the Central Government. Chapter III, being the main Chapter, comprising Ss. 3 to 24, deals principally with imposition and limits of ceiling on vacant land, acquisition and vesting in the State Government of vacant land in excess of the ceiling limits, payment to be made to the holders for such acquisition, disposal of excess vacant land so acquired and exemptions from the applicability of this Chapter, Chap, IV comprising Ss. 25 to 30 deals with regulation of transfer and the use of urban property; while Chapter V which inclules Ss. 31 to 47, deals with appeals, revisions, offences and punishments and other miscellaneous matters.

26. The primary object and purpose of the Act, as its long title and the Preamble show, is to provide for the imposition of a ceiling on vacant land in urban agglomerations, for the acquisition of such land in excess of the ceiling limit, to regulate the construction of buildings on such land and for matters connected therewith, with a view to preventing the concentration of urban land in the hands of a few persons and speculation and profiteering therein and with a view to bring about an equitable distribution of land in urban agglomerations to subserve the common good, presumably in furtherance of the Directive Principles of State policy contained in Art. 39 (c) and (b) respectively. The enactment has also been put in the Ninth Schedule as Item 132 by the Constitution (Fortieth Amendment) Act, 1976, in other words, the enactment enjoys the benefit of protective umbrella of both the articles, Arts. 31B and 31C as it stood prior to its amendment by the Constitution (Forty-second Amendment) Act, 1976.

27. Dealing with these two articles, namely, Arts. 31B and 31C and the protective umbrella provided by them in the context of the decision in Kesavananda Bharati’s case (supra) this Court in Waman Rao v. Union of India (1980) 3 SCC 587, has by its order passed on May 9, 1980, held thus:

“In Kesavananda Bharati decided on April, 24, 1973 it was held by the majority that Parliament has no power to amend the Constitution so as as to damage or destroy its basic structure. We hold that all amendments to the Constitution which were made before April 24, 1973 and by which the 9th Schedule to the Constitution was amended from time to time by the inclusion of various Acts and Regulations therein, are valid and constitutional. Amendments to the Constitution made on or after April 24, 1973 by which the 9th Schedule to Constitution was amended from time to time by the inclusion of various Acts and Regulations therein, are open to challenge on the ground that they, or any one or more of them, ate beyond the constituent powers of the parliament since they damage the basic or essential features of the Constitution or its basic structure. We do not pronounce upon the validity of such subsequent constitutional amendments except to say that if any Act or Regulation included in the 9th Schedule by a constitutional amendment made after April 24, 1973 is saved by Article 31C as it stood prior to its amendment by the 42nd Amendment, the challenge to the validity of the relevant Constitutional Amendment by which that Act or Regulation is put in the 9th Schedule, on the ground that the Amendment damages or destroys a basic or essential feature of the Constitution or its basic structure. as reflected in Articles 14, 19 or 31, will become otiose.

Article 31C of the Constitution, as it stood prior to its amendment by Section 4 of the Constitution (42nd Amendment) Act, 1976, is valid to the extent to which its constitutionality was upheld in Kesavananda Bharati. Article 31C, as it stood prior to the Constitution (42nd Amendment) Act does not damage any of the basic or essential features or the Constitution or its basic structure.”

Since the impugned Act has been put in the Ninth Schedule by the Constitution (Fortieth Amendment) Act, 1976 i. e. after April 24, 1973, the said Constitutional Amendment would be open to challenge on the ground that the same is beyond the constituent power of the Parliament if it damages the essential features or basic structure of the Constitution; but at the same time the impugned Act has, apparently, received the protective umbrella of Art. 31C as it stood prior to its amendment by 42nd Amendment Act inasmuch as, it seems to have been enacted in furtherance of the Directive Principles contained in Art. 39 (b) and (c) with the result that in order to succeed in their challenge the petitioners will have to cross two hurdles. In the first place they will have to establish that the Act is outside the pale of the protective umbrella of Art. 31C which they can do by showing that though purporting to do so, it does not, in fact, further any of the said Directive Principles. A scrutiny of the Directive Principles contained in Art. 39 (b) and (c) clearly shows that the basic postulate underlying the former obviously is that diffusion of ownership and control of the material resources of the community is always in public interest and hence the State is directed to ensure such distribution (equitable) thereof as best to subserve the common good, while the postulate underlying the latter obviously is that concentration of wealth as well as means of production in the hands of few is detrimental to common interest and hence the State is directed to ensure such economic system to operate which prevents such concentration. It would therefore, be clear that if by the impugned enactment the aforesaid objectives of these Directive Principles are not furthered or if the provisions of the enactment run counter to these objectives the Act would lose the benefit of the protective umbrella of Art. 31C. Secondly, after crossing this hurdle, the petitioners will have to show further that the 40th Amendment Act by which the impugned Act was included in the Ninth Schedule was beyond the constituent power of the Parliament since it has damaged the basic structure or the essential features of the Constitution as reflected in Arts. 14, 19 and 31, which, of course they will be able to do by showing that the impugned Act itself flagrantly violates those aspects of Arts. 14, 19 and 31 which constitute the basic structure or the essential features of the Constitution.

28. It may be stated that counsel for the petitioners principally attacked four provisions of the impugned Act – (a) artificial definition of ‘family’ given in S. 2 (f) in relation to the prescription of ceiling area, (b) provision contained in S. 11 relating to amount payable in respect of excess vacant land acquired by the State. (c) provision contained in S. 23 relating to disposal of excess vacant land acquired by the State and (d) prohibition or restriction on transfer of a building or a part thereof or a flat therein, though unconcerned with excess vacant land, without permission, as being flagrantly violative of those aspects of the petitioners fundamental rights under Arts. 14, 19 and 31 as constitute the essential features or basic structure of the Constitution. Counsel for the petitioners also contended that some of the aforesaid impugned provisions which are pivotal and have an impact on the entire scheme of the Act, in fact, run counter to the Directive Principles of Art. 39 (b) and (c) and, therefore, put the entire Act outside the pale of the protective umbrella of Art. 31C of the Constitution. Counsel. therefore, urged that both the 40th Amendment to the extent it inserted the impugned Act in the Ninth Schedule and the impugned Act deserve to he struck down.

29. On the other band, the learned Attorney General appearing on behalf of the Union of India and counsel for the concerned States of Rajasthan, Andhra Pradesh, Uttar Pradesh and for the concerned competent authorities under the Act, refuted the contentions urged on behalf of the petitioners. It was denied that any provision of the Act runs counter to the Directive Principles of Article 39 (b) and (c) of the Constitution. It was pointed out that the impugned Act having been put in the Ninth Schedule and having been enacted in furtherance of the Directive Principles of the State Policy contained in Arts. 39 (b) and (c) of the Constitution was protected both under Arts. 31B and 31C of the Constitution. It was disputed that any provision of the Act violated the petitioners’ fundamental rights under Arts. 14. 19 and 31 and, it was contended that even if there was any such violation, the Act and its provisions could not be challenged by the petitioners on that ground because of the protective umbrella of Arts. 31B and 31C of the Constitution and, therefore, the petitions were liable to be dismissed.

30. I shall first deal with those impugned provisions of the Act, which according to the petitioners not merely violate their fundamental rights but also have an adverse impact on the protective umbrella afforded by Art. 31C of the Constitution. In this behalf counsel for the petitioners referred to two provisions, namely, S. 2 (f) which gives an artificial definition of ‘family’ in relation to prescription of ceiling area and S. 23 which contains provision relating to disposal of excess vacant land acquired by the State.

Re:S. 2 (f) in relation to prescription of ceiling area.

31. It is by S. 3 of the Act that the ceiling on vacant land in any urban agglomeration is imposed. That section runs thus:

“3. Except as otherwise provided in this Act, on and from the commencement of this Act, no person shall be entitled to hold any vacant land in excess of the ceiling limit in the territories to which this Act applies under sub-section (2) of Section 1.”

The ceiling limits referred to in the above section, as stated earlier, have been fixed at 500 sq. metres, 1,000 sq. metres, 1.500 sq. metres and 2,000 sq. metres for vacant lands in urban agglomerations falling in categories A, B, C and D respectively under S. 4 (1). Section 2 (i) defines ‘person’ as including an individual, a family, a firm, a company, or an association or body of individuals, whether incorporated or not; while S. 2 (f) defines ‘family’ thus:

“Family”, in relation to a person means the individual, the wife or husband, as the case may be, of such individual and their unmarried minor children.”

And the Explanation to this clause states that “minor” means a person who has not completed his or her age of eighteen years. There is no doubt that the aforesaid definition of ‘family’ is an artificial one inasmuch as it excludes from its scope major children who are normally included in the concept of a family; it further completely ignores the normal Joint Hindu Family. Counsel for the petitioners pointed out that if this artificial definition of ‘family’ considered in the context of ceiling limits prescribed under S. 4 (1) it produces discriminatory results because of adoption of double standard for fixing the ceiling limit – one for the artificial family as defined and another for a normal family which includes major children or for joint Hindu Family governed by Mitakshara Law obtaining in several parts of the country. For instance, in an urban agglomeration falling under category ‘A’ where the ceiling limit is prescribed at 500 sq. metres, a family of a father, mother and say three minor sons (being in all five) together will be entitled to retain for itself only 500 sq. metres of vacant land whereas a family of a father and four major sons (being in all five) will be entitled to retain for itself 2,500 sq. metres of vacant land (500 sq. metres for father as a person and 500 sq. metres each for four sons as persons). counsel urged that such discrimination or inequality arises from the classification made between minor children and major children belonging to a family but such classification is not based on any intelligible differentia having any nexus to the object sought to be achieved by the Act, which is to acquire excess vacant land after leaving the ceiling area to a family and as such the same is clearly violative of Art. 14 of the Constitution. Counsel strongly relied upon two decisions of this Court in this behalf, namely, decisions in Karimbil Kunhikoman v. State of Kerala (1962) 1 Suppl. SCR 829 and A. P. Krishnasami Naidu v. State of Madras, (1964) 7 SCR 82, where on similar ground the whole of Chapter III of Kerala Agrarian Relations Act, 1961 and the whole of Chapter II of the Madras Land Reforms (Fixation of Ceiling on Land) Act, 1961, respectively were struck down by this Court inasmuch as the artificial definition of family together with adoption of double standard for fixing ceiling limit formed the basis of the concerned Chapter in each Act. I find considerable force in counsel’s contention.

32. I may point out that when the agricultural ceiling matters were argued before us counsel for the petitioners therein had raised a similar contention in the context of the artificial definition of ‘family’ and the adoption of double standard for fixing ceiling limits obtaining in the several concerned Acts and in support of such contention counsel had placed reliance on the aforesaid two decisions of this Court but we rejected the contention on the ground that ample material had been produced before the Court justifying the adoption of artificial definition of ‘family’ and double standard for fixing the ceiling limits in those Acts. Production of such justifying material distinguished the agricultural ceiling matters before us from the said two decisions relied upon by counsel but in the instant case no material whatsoever has been placed before the Court by the respondents justifying the adoption of the artificial definition of ‘family’ in S. 2 (f) and double standard of fixation of ceiling in the impugned Act. It has not been shown that the so-called nuclear families allegedly in vogue have replaced normal families which include major sons or joint Hindu families in urban areas. Besides, if the object of the impugned Act is to acquire excess vacant land in urban agglomerations after leaving permissible ceiling area to a family the classification made between minor children and major children belonging to a family has no nexus whatsoever to that object. In my view, therefore, the artificial definition of ‘family’ given in S. 2 (f) when considered in relation to the prescription of the ceiling area under S. 4 (1) is clearly violative of and strikes at the root of the equality clause contained in Art. 14 of the Constitution. It cannot be disputed that this artificial definition together with the double standard adopted for fixing the ceiling area runs through and forms the basis of Chapter III of the Act and the discriminatory results or inequalities produced thereby are bound to have an impact on the scheme of that Chapter, and, therefore, along with it the whole Chapter III must fall as being violative of Art. 14.

33. There is yet one more aspect which needs consideration in connection with this adoption of the artificial definition of ‘family’ given in S. 2 (f) and the double standard for fixing ceiling area. Apart from the discriminatory results which it produces the question is what is its impact in the context of the directive principle contained in Art. 39 (c) of the Constitution? As stated earlier the postulate underlying the said directive principle is that concentration of wealth in the hands of few is detrimental to common interest and as such the State should ensure such economic system which prevents such concentration and the Act has been put on the Statute Book professedly to achieve that objective. But, by adopting the artificial definition of ‘family’ in S. 2 (f) and having double standard for fixing ceiling limit a contrary result is obtained inasmuch as the Act actually permits an unwarranted and unjustified concentration of wealth (urban vacant land) in the hands of a family having major sons in it as compared to the family having minor children. In the illustration given above a family of a father with four major sons is allowed to retain with itself 2,500 sq. metres of vacant land while a family of a father, mother and three minor sons is permitted to retain only 500 sq. metres. The position becomes more glaring if I take the illustration of a joint Hindu family consisting of five brothers, each having five major sons, as, in such a case the said joint Hindu family will be entitled to retain 15,000 sq. metres of vacant land as against 500 sq. metres permitted to be retained by the artificial family. It cannot be said at large joint Hindu families are unknown in urban agglomerations in various cities and towns of the country and instances more glaring than the preceding illustration could be multiplied. In other words, by adopting the artificial definition of ‘family’ and double standard for fixing the ceiling area the Act enables unwarranted and unjustified concentration of wealth in the hands of few rather than preventing the same and this certainly would be in teeth of and not in furtherance of the directive principle of Art. 39 (c); in fact, it is a negation of that principle. It is not possible to take the view that the Parliament out of inadvertence ignored joint Hindu family or forgot the possible concentration of vacant land in the hands of major members of large joint Hindu families, because in another context the concept of joint Hindu family was present to the mind of the draftsman as is clear from S. 4 (7) of the Act. In my view, therefore the adoption of the artificial definition of ‘family’ and double standard for fixing ceiling area one for a family with minor children and another for a family with major children and completely ignoring the concept of joint Hindu family in relation to prescription of ceiling area clearly lead to results which run counter to the directive principle contained in Art. 39 (c) of the Constitution. The Act which contains such provision being in teeth of that directive principle must fall outside the pale of protective umbrella of Art. 31C.

Re:S. 23 relating to disposal of excess vacant land acquired under the Act.

34. It may be stated that under S. 6 every person holding vacant land in excess of the ceiling limit at the commencement of the Act is required to file within the period prescribed a statement before the competent authority having jurisdiction giving full particulars thereof and also specifying the vacant land within the ceiling limit which he desires to retain. Sections 8 and 9 provide for preparation of draft statement as regards vacant land held in excess of the ceiling limit, holding of an inquiry in that behalf and preparation of final statement and service thereof on the concerned person by the competent authority. Section 10 provides for acquisition of excess vacant land by the concerned State Government and determination of claims of all persons interested in such excess vacant land and under sub-s. (3) it is provided that upon the publication of a notification in that behalf such excess vacant land as may be specified therein shall be deemed to have been acquired by the State Government and the same shall vest absolutely in the State Government free from all encumbrances with effect from the date specified in the notification. Then comes S. 23 which deals with disposal of such excess vacant land acquired by the State Government under the Act. It runs as follows:

“23. (1) It shall be competent for the State Government to allot, by order, in excess of the ceiling limit, any vacant land, which is deemed to have been acquired by the State Government under this Act or is acquired by the State Government under any other law, to any person for any purpose relating to, or in connection with, any industry or for providing residential accommodation of such type as may be approved by the State Government to the employees of any industry and it shall be lawful for such person to hold such land in excess of the ceiling limit.

Explanation.- For the purposes of this section,

(a) where any land with a building has been acquired by the State Government under any other law and such building has been subsequently demolished by the State Government, then, such land shall be deemed to be vacant land acquired under such other law;

(b) “industry” means any business. profession, trade, undertaking or manufacture.

(c) In making an order of allotment under sub-section (1), the State Government may impose such conditions as may be specified therein including a condition as to the period within which the industry shall be put in operation or, as the case may be, the residential accommodation shall be provided for:

Provided that if, on a representation made in this behalf by the allottee, the State Government is satisfied that the allottee could not but the industry in operation, or provide the residential accommodation, within the period specified in the order of allotment, for any good and sufficient reason, the State Government may extend such period to such further period or periods as it may deem fit.

(3) Where any condition imposed in an order of allotment is not complied with by the allottee, the State Government shall, after giving an opportunity to the allottee to be heard in the matter, cancel the allotment with effect from the date of the non-compliance of such condition and the land allotted shall revest in the State Government free from all encumbrances.

(4) Subject to the provisions of sub-sections (1), (2) and (3), all vacant lands deemed to have been acquired by the State Government under this Act shall be disposed of by the State Government to subserve the common good on such terms and conditions as the State Government may deem fit to impose.

(5) Notwithstanding anything contained in sub-sections (1) to (4), where the State Government is satisfied that it is necessary to retain or reserve any vacant land, deemed to have been acquired by that Government under this Act, for the benefit of the public, it shall be competent for the State Government to retain or reserve such land for the same.”

Five or six aspects or peculiar features emerge clearly from the provisions contained in S. 23 in the context of the entire Act. In the first place unlike agrarian ceiling which deals with land as means of production, urban ceiling under the impugned Act deals with vacant land in urban agglomerations not as a means of production but as a part of the holder’s wealth or capital asset. Secondly, unlike agrarian ceiling which has the objective of distributing surplus agricultural land straightway among landless persons, under the impugned Act excess vacant land in urban agglomerations is acquired by and vests in the State to be disposed of as indicated in the section; clearly a legislation in exercise of the State’s power of eminent domain (i. e. power of compulsory acquisition of private property). Thirdly, such excess vacant land thus acquired is to be disposed of by the State Government “for any purpose relating to or connected with industry or for providing residential accommodation to the employees of any industry”. Fourthly, under cl. (b) of the Explanation, ‘industry’ has been very widely defined for the purposes of this section to mean any business, profession, trade, undertaking or manufacture; the word ‘any’ clearly suggests that business, profession trade, undertaking or manufacture even in private sector is included. Fifthly, sub-s. (1) confers absolute power and discretion on the State Government to allot any amount of such excess vacant land to any person for any industry. Reading the fourth and fifth aspects together, it is clear that it is open to the State Government to allot any extent of such excess vacant land to any professional person, say a lawyer, a medical practitioner or even an astrologer for the purpose of carrying on his private profession. Sixthly, the section contemplates utilisation of such excess vacant land by the State Government in three ways: (a) allotment for industry, (b) allotment to subserve the common good and (c) retention or reservation for the benefit of the public, but, the priorities in the matter of disposal or distribution of such excess vacant land have been peculiarity fixed in the section; these priorities, as indicated in sub-ss. (1) and (4), are.- (i) allotment for the purpose of an industry, namely, any business, profession, undertaking, trade or manufacture, (ii) allotment for the purpose of construction of houses for the employees of an industry specified in item (i) above and (iii) disposal to subserve the common good which would include allotment of vacant land for governmental purpose or local authorities or for institutions, etc. In other words. it is after the disposal of such excess vacant land for items (i) and (ii) above that the balance thereof can be disposed of “to subserve the common good” which means private purposes have precedence over public purposes, and this is clear, from the fact that disposal under sub-s. (4) is “subject to” the prior disposal under sub-s. (1) for purposes of industry. In fact, disposal of excess vacant land for subserving the common good is last in the priorities. Sub-s. (5) undoubtedly has an overriding effect over sub-ss. (1) to (4) but that provision deals not with disposal or distribution of excess vacant land but with retention and reservation of such vacant land by State Government for the benefit of the public like social housing and provision for basic amenities, etc.

35. Having regard to the aforesaid peculiar features that emerge from a consideration of the provisions contained in S. 23, counsel for the petitioners contended that the acquisition of excess vacant land in urban agglomerations cannot be said to be for a public purpose at all and hence the enactment which is primarily for compulsory acquisition of private property runs counter to a valid exercise of the State’s power of ‘eminent domain’. He pointed out that no scheme for any industrial development for any urban agglomeration has been indicated in the Act, nor any such scheme seems to have been prepared by any State Government or even by the Union Government before undertaking the legislative measure in hand and no definite public purpose of industrialisation with any plan or blue print with set specifications or standards seems to have been within the contemplation of the sponsoring States or the Union Government; at any rate no material in that behalf has been placed on record before the Court and, therefore, according to counsel, compulsory acquisition of all excess vacant land in all urban agglomerations throughout the Union Territories and the 17 States of the country for achieving a bald, indefinite and unspecified objective of ‘industry’ would not be a valid exercise of the power of eminent domain. Alternatively, counsel contended that even if it were assumed for the purpose of argument that a bald, indefinite and unspecified objective of ‘industry’ is a public purpose, when that concept of ‘industry’ is widely defined so as to include any business, trade or profession in private sector, the purpose sheds its character as a real public purpose, which position is further compounded by the priorities laid down in the section and the acquisition becomes acquisition for private purpose amounting to an invalid exercise of the State’s power of eminent domain. Counsel, therefore, urged that S. 23 flagrantly violates Article 31 (2) and is, therefore, ultra vires and unconstitutional and since it is a pivotal provision having an impact on the entire ceiling scheme and at the same a non-severable provision from the rest of the provisions contained in that Chapter, the whole of Chapter III must fall with it.

36. Article 31 of the Constitution has more than one facet; it undoubtedly confers upon individuals (including non-citizens) and corporate bodies a fundamental right to property but because of conflict of views in Keshavananda Bharati’s case (supra) it may be debatable whether that right forms part of basic structure or not; but that apart. Art. 31 incorporates in our Constitution the concept of State’s power of eminent domain i. e. power of compulsory acquisition of private property and prescribes two conditions precedent to the exercise of the power, namely, (i) such acquisition cannot be except for a public purpose and (ii) it must be on payment of compensation (now termed ‘amount’) to the claimant having interest in the property. In Kameshwar Singh’s case (1952) SCR 889 this position has been clarified where Mahajan, J., after referring to some authoritative books has summed up the definition of the concept in one sentence thus – “Authority is universal in support of the amplified definition of ‘eminent domain’ as the power of the sovereign to take property for public use without the owner’s consent upon making just compensation.” The requirement of just compensation under the latter condition is diluted to payment of non-illusory amount under the 25th Amendment of the Constitution and subsequent decisions of this Court. But it is well settled that these two conditions precedent are sine qua non for the exercise of the States power of ‘eminent domain’ and, in my view, represent those aspects of the right to property under Art. 31 which constitute the essential or basic features of our Constitution and for that matter these would be so of any democratic constitution and, therefore, any law authorising expropriation of private property in breach of any one of those conditions would damage or destroy the basic structure of our Constitution.

37. It is extremely doubtful whether a bald, indefinite and unspecified objective like ‘industry’ simpliciter without any attempt at dovetailing it by having a proper scheme for industrial development will constitute a valid public purpose for the exercise of the power of ‘eminent domain’. It is because of the absence of any definite scheme for industrial development with plans or blue prints with set specifications or standards for any of the urban agglomerations that wide power has been conferred on the State Government under sub-s. (1) in vague terms to allot any extent of such excess vacant land to any person for any industry. I am conscious that in Kameshwar Singh’s case (supra) this Court speaking through Mahajan, J., observed that “the phrase ‘public purpose’ has to be construed according to the spirit of times in which the particular legislation is enacted” and held that so construed, acquisition of estates for the purpose of preventing the concentration of huge blocks of land in the hands of a few individuals and to do away with intermediaries was for a public purpose. But that case dealt with three statutes (the Bihar Land Reforms Act, 1950. the M. P. Abolition of Proprietary Right Act, 1950 and the U. P. Zamindari Abolition and Land Reforms Act, 1950), the common aim of which, generally speaking, was to abolish zamindaries and other proprietary estates and tenures in the three States, so as to eliminate the intermediaries by means of compulsory acquisition of their rights and interests and to bring the raiyats and other occupants of lands in those areas into direct relation with the Government and, therefore, that case is distinguishable and its ratio would not apply to the instant case where the purpose of acquisition of excess vacant (urban) land is a bald objective like ‘industry’ simpliciter; surely different considerations would apply. In my view it is extremely doubtful whether compulsory acquisition of all the excess vacant land in all urban agglomerations throughout the country for a bald, indefinite and unspecified objective like ‘industry’ simpliciter would be a valid exercise of the power of ‘eminent domain’. However, it is not necessary for me to decide this larger question inasmuch as in my view the alternative submission of counsel for the petitioners clinches the issue in this case. Assuming that a bald objective of ‘industry’ simpliciter partakes of the character of a public purpose, what Parliament intended by the said objective has been expressly clarified by cl. (b) of the Explanation where ‘industry’ has been very widely defined so as to include any business, trade or profession in private sector which makes a mockery of such public purpose. Whatever be the merits or demerits of a wide definition of ‘industry’ for the purposes of industrial-cum-labour relations, adoption of such wide definition of the concept in the context of eminent domain is clearly suicidal. By adopting such definition for the purposes of S. 23 the State Government as been empowered under sub-s. (1) to allot any extent of such excess vacant land to any businessman, trader or professional man like a lawyer, doctor and astrologer to enable him to carry on his private business, trade or profession. In other words, acquisition of excess vacant land in urban agglomeration would clearly be for private purposes and what is worse is that under the priorities laid down such private purposes are to be catered to first and then comes the disposal or distribution thereof to subserve common good. This clearly smacks of depriving Peter of his property to give it to Paul and, therefore, clearly amounts to an invalid exercise of State’s power of ‘eminent domain’. Section 23, which thus authorises compulsory acquisition of property for private purposes flagrantly violates those aspects of Art. 31 which constitute the essential or basic features of the Constitution and is, therefore, ultra vires and unconstitutional. Further, indisputably it is the most vital, integral and non-severable part of the entire scheme of urban ceiling as without it the scheme will merely remain a scheme for unjust and illegal enrichment of the State and, therefore, the whole of Chapter III, in which it occurs, must fall with it.

38. Apart from the unconstitutionality of S. 23 as indicated above, it is clear that the wide definition of, ‘industry’ and the priorities for disposal or distribution of excess vacant land laid down therein have adverse impact on the directive principle contained in Aft. 39 (b). In the first place instead of confining the objective of industrialisation to public sector or cooperative sector and the like where benefit to community or public at large would be the sole consideration, the concept is widely defined to include any business, trade or profession in private sector which enables the disposal or distribution of excess vacant land for private purposes and sub-s. (1) authorises the State Government to allot any extent of such land to individuals or bodies for private purposes. Secondly, the priorities in the matter of disposal or distribution of the excess vacant land under sub-sections (1) and (4) are as indicated above. which show that disposal or distribution of exceess vacant land for subserving the common good comes last in the priorities. I have already indicated that the postulate underlying the directive principle of Art. 39 (b) is that diffusion of ownership and control of the material resources of the community is always in the public interest and, therefore, the State is directed to ensure such distribution (equitable) thereof as best to subserve the common good but the priorities prescribed in sub-ss. (1) and (4) of S. 23 in regard to distribution of material resources produce contrary results or results in the opposite direction inasmuch as private purposes receive precedence over common good. The enactment which contains such provisions that produce contra results cannot be said to be in furtherance of the directive principle of Art. 39 (b) and cannot receive the benefit of the protective umbrella of Art. 31C.

39. Counsel for the respondents, however, relied upon three aspects to counteract the aforesaid result flowing from the priorities given in S. 28 (1) and (4). It was urged that the disposal of excess vacant land acquired by the State under the Act will be guided by the Preamble which says that enactment was put on the Statute Book with a view to bringing about the equitable distribution of land in urban agglomerations to subserve the Common good. In the first place, it is well settled that it is only when there is some ambiguity in the text of any provision in the enactment that the Preamble could be looked at and here there is no ambiguity whatsoever in S. 23 (1). and (4), Secondly, far from there being any ambiguity there is express provision in S. 23 (1) and (4) indicating the priorities in the matter of disposal or distribution of excess vacant land, in face of which, the Preamble cannot control, guide or direct the disposal or distribution in any other manner. Next, reliance was placed on S. 46 (1) which empowers the Central Government to make rules for carrying out the provisions of the Act and the disposal or distribution of excess vacant land could be prescribed by rules. It may, however, be stated that no rules under Section 46 have so far been framed by the Central Government and. in any event, no rules framed thereunder can override the express provisions of S. 23. Lastly, reliance was placed on certain guidelines issued by the Central Government in its Ministry of Works and Housing under the Act and at page 83 of the “Compendium of Guidelines” (a Govt. of India publication dated Feb. 22, 1977) a Note containing guidelines on utilization of excess vacant land acquired under the Act is published. Paragraphs 3 and 4 of the said Note deal with the topic of priorities. In Para 3 the disposal or distribution of excess vacant land as per the priorities in S. 23 has been set out (which are the same as given above) while Para 4 sets out the priorities in accordance with the recommendations made by the 9th Conference of State Ministers of Housing and Urban Development held at Calcutta on the 17th, 18th and 19th December, 1976, which considered the matter and the priorities indicated are: (i) Retention/reservation for the ‘benefit of the public’ like social housing, provision of basic amenities, etc. (ii) Disposal ‘to subserve common good’ which may include allotment of vacant land for Government purposes, local authorities, institutions, etc. (iii) Allotment for the purpose of construction of houses for the employees of industries specified in item (iv) below; (iv) Allotment for the purpose of industry, viz., any business, profession, trade, undertaking of non-polluting manufacture; cottage and small scale and wherever possible ancillary industry, manufacture. It will appear clear that the recommendations made by the 9th Conference of State Ministers of Housing and Urban Development seek to furnish improved guidelines but in the process reverse the priorities given in the section in the matter of disposal or distribution of excess vacant land. It is obvious that the priorities given in S. 23 and as have been summarised in Para 3 of the Note must prevail over the priorities indicated in the guidelines contained in Para 4 of the Note and the latter are of no avail. It is thus clear that the priorities as given in S. 23 (1) and (4) in the matter of disposal or distribution of excess vacant land acquired under the Act run counter to and in a sense operate to negate the directive principle of Article 39 (b).

40. It was then faintly argued by counsel for the respondents that the law in order to receive the protection of Article 31C need not fulfil the objectives of both Art. 39 (b) and (c) and even if it fulfils the objective under Art. 39 (c) and not under Art. 39 (b) it will be protected by Art. 31C. But here S. 23 by no stretch deals with the objective of Art. 39 (c) at all but only deals with the objective underlying the directive principle of Article 39 (b) and its provisions as discussed above clearly run counter to that objective and as such the enactment which contains such provisions must forfeit the benefit of the protective umbrella of Article 31C

41. Faced with the situation that the constitutional invalidity of S. 23 was likely to have adverse repercussion not only on Chapter III in which it occurs but also on the entire Act, counsel for the respondents made a valiant effort to salvage the said section by indulging in interpretative acrobatics with a view to relieve it from the two vices attaching to it, namely, (i) the adoption of the wide definition of ‘industry’ in Cl. (b) of the Explanation which makes a mockery of the public purpose indicated by the bald objective like ‘industry’ simpliciter and (ii) the priorities mentioned therein governing the disposal or distribution of excess vacant land acquired under the Act. it was suggested that the definition of ‘industry’ should be read down by the Count so as to confine the same to industries in public sector or co-operative sector or the like where benefit to community or public at large would be the sole consideration, so that allotment of excess vacant land acquired under the Act to private entrepreneurs for private purposes which runs counter to the doctrine of eminent domain would be completely eschewed. It is impossible to read down the definition in the manner suggested because Parliament has for the purposes of the section (i. e. for purposes of disposal or distribution of such excess vacant land) deliberately and in express terms adopted a very wide definition which includes within its scope not merely trading or manufacturing activity but also any business or profession in private sector and reading down the definition as suggested would be doing violence to the Parliament’s intention stated in express terms. It was then submitted that subsection (1) of S. 23 should be construed as an enabling provision which merely permits the State Government to allot excess vacant land for the purposes of industry, while the real obligation in the matter of disposal of excess vacant land arises under sub-sec. (4) which speaks of disposal of such land “to subserve the common good”; in other words the disposal under sub-sec. (4) should override the disposal under sub-sec. (1); at any rate the “common good” spoken of in sub-section (4) should permeate the disposal under sub-sec. (1). It is impossible to read sub-sec. (1) of Section 23 as containing merely an enabling provision; the scheme of sub-ss. (1) and (4) read together clearly shows that the disposal of the excess vacant land is first to be done under sub-s. (1) and disposal under subsection (4) comes thereafter. The opening words of sub-sec. (4) “subject to sub-ss. (1), (2) and (3)” cannot be read as constituting a non obstante clause giving an overriding effect to sub-s. (4) nor can sub-section (4) be read as if the opening words were absent. By indulging in such interpretative acrobatics the Court cannot reach the opposite result than is warranted by the plain text of the provision. Further, to say that every disposal of excess vacant land under sub-s. (1) must be for common good” is to read into that subsection something which is not there; it amounts to re-writing that sub-section, which cannot be done, the Preamble notwithstanding. It is the conferral of such unrestricted power (not its oblique exercise) that is being attacked and hence the submission to read into sub-sec. (1) this kind of limitation. These submissions require the re-structuring of the entire section – a function legitimately falling within the domain of the Legislature. Moreover, sub-ss. (1), (2), (3) and (4) of S. 23 are integral parts of one whole scheme dealing with disposal of excess vacant land acquired under the Act and as such cannot be severed from one another. The attempt to salvage S. 23, either wholly or in part, by seeking to free it from the two vices must, therefore, fail.

42. The next provision challenged by the petitioners as being violative of their fundamental rights is Section 11 (6) which puts the maximum limit of ` two lakhs on compensation (called ‘amount’) payable to the holder of excess vacant land irrespective of the extent of such excess vacant land. For the purpose of determining the quantum of compensation S. 11 (1) divides vacant land in urban agglomerations into two categories – (i) vacant land from which income is derived and (ii) vacant land from which no income is derived and in regard to the former category Cl. (a) of sub-section (1) fixes the quantum payable at an amount equal to eight and one third times the net average animal income actually derived from such land during the period of five consecutive years immediately preceding the date of publication of the notification issued under S. 10 (1) and the net average annual income is to be calculated in the manner and in accordance with the prinicples set out in Schedule II; while in respect of the latter category, Cl. (b) of sub-s. (1) fixes the quantum payable at an amount calculated at a rate not exceeding – (i) ` 10/- pep-sq. metre in the case of vacant land situated in urban agglomerations falling with categories A and B and (ii) ` 5/- per sq. metre in the case of vacant land situated in urban agglomerations falling within categories C and D. In other words, for vacant land yielding income the method of capitalisation of the income for certain number of years is adopted while for vacant land yielding no income maximum rates of compensation for A and B categories at ` 10/- per sq. metre and for C and D categories at ` 5/- per Sq. metre have been fixed. Compensation (called ‘amount’) once determined is payable to the holder under Section 14 (2) in a certain manner, namely, 25% thereof will be paid in cash and the balance 75 per cent in negotiable bonds redeemable after expiry of 20 years carrying interest at 5% per annum. Section 11 (6) which puts the maximum limit of two lakhs on the quantum payable in respect of excess vacant land acquired under the Act runs thus:

“11 (6) – Notwithstanding anything contained in sub-section (1) or sub-sec. (6) the amount payable under either of the said sub-sections shall, in no case, exceed two lakhs of rupees.”

43. Counsel for the petitioners contended that S. 11 (6) which puts the maximum limit of ` two lakhs on the amount payable to a claimant irrespective of the extent of the excess vacant land acquired under the Act is not only arbitrary but also results in illusory payment and violates Arts. 14 and 31 (2) respectively. Counsel pointed out that, a:person holding excess vacant land which at the prescribed rates is of the value of ` two lakhs and a person holding such excess vacant land which even at the same prescribed rates is of the value of ` two crores are treated alike. that is to say, both will get compensation (termed ‘amount’) of ` two lakhs only and in this sense prescribing a limit of maximum of ` two lakhs is clearly arbitrary and violates Art. 14. Similarly, for a person who holds excess vacant land which even at the prescribed rates is of the value of ` two crores a payment of ` two lakhs only (i. e. 1/100th of the value at the prescribed rates) must, by and standard, be regarded as illusory and therefore, the fixation of maximum limit at ` two lakhs under S. 11 (6) irrespective of the extent of excess vacant land held by a person violates Art. 31 (2) of. the Constitution. I find considerable force in both the submissions of counsel for the petitioners. In fact, in my view, this provision which puts the maximum limit of ` two lakhs on the amount payable to a holder of excess vacant land acquired under the Act irrespective of the extent of such excess vacant land held by him is not merely violative of Arts. 14 and 31 (2) of the Constitution in the manner indicated above, but would be a piece of confiscatory legislation, because vacant land in excess of that portion which at the Prescribed rates is worth ` two lakhs stands confiscated to the State without any payment whatsoever. I do not suggest that a provision putting a maximum limit upon compensation payable to the owner or holder irrespective of the extent of the property acquired whenever or wherever is found in any enactment has to be regarded as a confiscatory provision. I am aware that in enactments involving large schemes of social engineering like abolition of Zamindaris, agrarian reforms, nationalisation of undertakings and businesses and the like, such a provision might be justifiably made. In State of Kerala v. The Gwalior Rayon Silk Mfg, Co. Ltd., (1974) 1 SCR 671 this Court upheld the validity of Kerala Private Forest (Vesting and Assignment) Act, 1971 whereunder private forest lands held on janman right were acquired without payment of any compensation on the ground that such acquisition was for implementing a scheme of agrarian reform by assigning lands an registry or by way of lease to poorer sections of the rural agricultural population, the enactment being protected under Art. 31A (1) of the Constitution. Again the Coal Mines (Nationalisation) Act, 1973 whereunder the right, title and interest of the owners in relation to their coal mines specified in the schedule to the Act stood transferred to and became vested absolutely in the Central Govt. free from encumbrances in exchange of payment of fixed amounts specified in that schedule was upheld by this Court. But such cases involving large schemes of social engineering where avowedly the benefit of the community or public at large is the sole consideration are distinguishable from the instant case, where ‘industry’ has been expressly defined to include business, trade or profession in private sector and where power has been conferred upon the State Government to allot properties acquired under the enactment to individual businessman, trader or professional to enable him to carry on his private business, trade or profession, that is to say, where the legislation is a fraud on State’s power of eminent domain, such a provision of putting a maximum limit on compensation payable in respect of the acquired property irrespective of its extent will have to be regarded as confiscatory in nature.

44. An instance in point is available on the record of these writ petitions. In writ petition No. 350 of 1977 the petitioner who happens to be the ex-Ruler of the former Kota State has averred in paragraphs 17 and 20 of the petition that the urban vacant land owned and possessed by him in the city of Kota admeasures 918.26 acres and that the Assistant Director, Lands and Building Tax, Kota in his assessment order dated 20-12-1976 had valued the same at market rate of Rupees 15.12 per sq. metre at ` 3,98,05,021.84 (say about ` four crores) and inclusive of other items of properties the total value was put down at ` 4.12 crores and these averments are substantially admitted in the counter-affidavit filed by S. Mahadeva Iyer on behalf of the Union of India where in Para. 9 he has stated thus:

“In reply to Para 20 of the writ petition I submit that the total assessment of the entire property comes to ` 4.56 crores. In other words, in the case of this petitioner the fact that he owns urban vacant land of the value of about ` four crores in the city of Kota stands admitted. Now, under Section 11 (6) for all this urban vacant land worth nearly ` four crores the petitioner will get only rupees two lakhs; it works out to a princely sum of eight annas for property worth ` 100/-, which would clearly be an illusory payment. In fact, all his vacant land, in excess of that portion which is worth ` two lakhs at the prescribed rates shall stand confiscated without any payment whatsoever. Such a glaring instance, available on the record of these petitions, brings out in bold relief how flagrantly Section 11 (6) violates Arts. 14 and 31 (2) of the Constitution; it highlights the aspect that such acquisition takes place in breach of the other condition precedent attaching to the power of eminent domain, namely, payment of non-illusory compensation. However, S. 11 (6) is clearly a severable provision, and that alone is liable to be struck down as being ultra vires and unconstitutional.

45. The next provision challenged by the petitioners is S. 27 occurring in Chapter IV to the extent to which it imposes restriction on transfer of an urban land with building or a part thereof or a flat therein though unconcerned or unconnected with the excess vacant land as unconstitutional being beyond the legislative authorisation as also violative of petitioners’ fundamental rights under Arts. 14 and 19 (1) (f). Section 27, as its marginal note indicates, deals with the subject of prohibition of transfer of urban property and sub-s. (1) thereof runs thus:

“27. (1) Notwithstanding anything contained in any other law for the time being in force, but subject to the provisions of sub-section (3) of Section 5 and subsection (4) of Section 10, no person shall transfer by way of sale, mortgage, gift, lease for a period exceeding ten years, or otherwise, any urban or urbanisable land with a building (whether constructed before or after the commencement of this Act) or a portion only of such building for a period of ten years of such commencement or from the date on which the building is constructed, whichever is later, except with the previous permission in writing of the competent authority.

Inter alia, the aforesaid provision is clearly applicable to a building or a portion of such building, which would include a flat therein standing on any urban or urbanisable land falling within the permissible ceiling area which a holder of a vacant land is entitled to retain with himself and under this provision any transfer of such property by way of sale, mortgage, gift or lease for ten years or otherwise, is prohibited for the period of ten years from the commencement of the Act except with the previous permission in writing of the competent authority. Under sub-s. (2) if the holder of such property falling within the permissible ceiling area is desirous of effecting a transfer of the type indicated above has to apply in writing for permission from the competent authority and under sub-section (3) the competent authority has been authorised after making such inquiry as it deems fit to grant the permission or refuse the same, but a refusal has to be accompanied by written reasons, copy whereof is to be furnished to the holder. Sub-section (4) provides that if within sixty days of the receipt of the application refusal is not communicated, the permission shall be deemed to have been granted by the competent authority.

46. Counsel for the petitioners made two submissions in regard to aforesaid restriction as made applicable to transfers of built-up properties that fall within the limits of ceiling area permitted to be retained by a holder. Firstly, such restriction would be outside the legislative authorisation conferred upon the Parliament as well as beyond the ambit and scope of the Act which has assiduously kept built-up properties outside the pale of imposition of ceiling. Secondly, such restriction requiring permission from the competent authority is arbitrary and violative of Art. 14 inasmuch as the power to grant the permission or to refuse it is unguided and untrammled which is bound to produce arbitrary results. In my view both the submissions have substance in them.

47. It cannot be disputed that though the authorisation was for imposition of ceiling on urban immovable property Parliament deliberately kept out built-up properties from the purview of the Act the and the Act seeks to impose ceiling only on vacant land in urban agglomerations; that being so any restriction on transfer of built-up properties or parts thereof (including flats therein) standing on urban land falling within the permissible ceiling area would be outside the purview of the Act. It was urged for the respondents that such a provision would be incidental or ancillary to the ceiling contemplated by the Act and would fall within the phrase “for matters connected therewith” occurring in the Preamble and the long title of the Act. It is not possible to accept the contention, for, the words “matters connected therewith” occurring in the concerned phrase must be correlated to what precedes that phrase, namely, “an Act to provide for ceiling on vacant land in urban agglomerations, for the acquisition of such land in excess of the ceiling limit, to regulate the construction of buildings on such land” (emphasis supplied) and, therefore, the words “matters connected therewith” must mean matters in relation to the ceiling imposed by the Act. A reference to objectives under Article 39 (b) and (e) (for the achievement of which the enactment is allegedly taken in hand) in the Preamble or long title cannot enlarge the ambit or scope of the Act. Any restriction imposed on built-up properties falling within the permissible ceiling area left with the holder would, therefore, be outside the ambit and scope of the Act.

48. The next question is whether the restriction which requires the holder of such property to seek permission of the competent authority before effecting any transfer thereof by way of sale, mortgage or gift, etc. is violative of Art. 14 of the Constitution. The contention is that the requirement in the absence of any guidelines governing the exercise of the power on the part of the competent authority in the matter of granting or refusing to grant the permission is highly arbitrary, productive of discriminatory results and, therefore, violates the equality clause of Art. 14. Counsel for the respondents fairly conceded that the section itself does not contain any guidelines but urged that the objectives of “preventing concentration, speculation and profiteering in urban land” recited in the Preamble would afford the requisite guidance for the exercise of the power to grant the permission sought or to refuse the same. Firstly, which of the three objectives mentioned in the Preamble should guide the exercise of power by the competent authority in any given case is not clear and in any case no standard has been laid down for achieving the objectives of preventing concentration, speculation, and profiteering in urban land or urban property and in the absence of any standard being laid by the Legislature- a purely legislative function, it will be difficult to hold that these broad objectives recited in the Preamble could effectively or adequately guide the exercise of power by the competent authority in the matter of granting or refusing to grant the permission and in the absence of guidelines the exercise of the power is bound to produce arbitrary or discriminatory results. It was also said that against the order passed by the competent authority under S. 27 an appeal to the Appellate Authority has been provided for under Section 33 and revision lies to the State Government under S. 34 and in view of such provision for appeal and revision the exercise of the power or discretion vested in the competent authority cannot be regarded as unfettered or arbitrary. Here again I feel that in the absence of any guidelines for the exercise of the power and in the absence of any standards having been laid down by the Legislature for achieving the objectives of prevention of concentration, speculation and profiteering in urban land and urban property, the provision for appeal and revision would not be of much avail to preventing arbitrariness in the matter of granting or refusing to grant the permission. Section 27 which does not adequately control the arbitrary exercise of the power to grant or refuse the permission sought, is clearly violative of Art. 14 of the Constitution and as such the requirement of permission contained therein will have to be struck down as beingultra viresand unconstitutional.

49. In the result, in view of the aforesaid discussion, I would like to indicate my conclusions thus:

(1) The impugned Act, though purporting to do so, does not, in fact further the directive principles in Art. 39 (b) and (c). Section 2 (f) in relation to prescription of ceiling area, as shown above, permits unwarranted and unjustified concentration of wealth instead of preventing the same and is in teeth of the objective under Art. 39 (c); similarly, S, 23, as discussed above, produces results contrary to the objective under Art, 39 (b). Therefore, the impugned Act is outside the pale of the protective umbrella of Art. 31C.

(2) Section 2 (f) which contains the artificial definition of ‘family’ in relation to the prescription of ceiling area, S. 23 which deals with disposal or distribution of excess vacant land acquired under the Act as per priorities laid down therein and S. 11 (6) which puts a maximum limit on the quantum of the amount payable in respect of excess vacant land acquired from a holder irrespective of the extent of area held by him these three provisions flagrantly violate those aspects of Arts. 14 and 31 which constitute the essential and basic features of our Constitution and hence the protective umbrella of Art. 31B is not available to the impugned Act inasmuch as the 40th Constitution Amendment Act 1976 to the extent to which it inserts the impugned Act in the Ninth Schedule is beyond the constituent power of the Parliament as the said Amending Act has the effect of damaging or destroying the basic structure of the Constitution.

(3). The artificial definition of ‘family’ given in S. 2 (f) in relation to prescription of ceiling area under S. 4 (1) is clearly violative of Art. 14 and as such is ultra vires and unconstitutional. Similarly, Section 23 which authorises compulsory acquisition of property for private purposes is in breach of the doctrine of eminent domainand since it flagrantly violates Art. 31 (2) is ultra vires and unconstitutional.

(4) Since Section 2 (f) together with adoption of double standard for fixing ceiling area runs through and forms basis of the whole Chapter III and since S. 23 is a vital, integral and non-severable part of the entire scheme of urban ceiling envisaged by Chapter III, the whole of Chapter III has to fall along with those two provisions and as such that Chapter is also declared to be ultra vires and unconstitutional. Further, it cannot be disputed that Chapter III comprises the substratum of the entire scheme of urban ceiling contemplated by the enactment incorporating its main provisions while the other Chapters deal with ancillary or incidental matters which form the decorative frills of the main fabric. If the substratum is found to be diseased, invalid and bad in law the entire Act has to go and is accordingly struck down as void and unconstitutional.

(5) Section 11 (6), a severable provision, being violative of petitioners’ fundamental right under Art. 31 is declared to be ultra vires and unconstitutional.

(6) Section 27, being severable, is also declared ultra viresand unconstitutional to the extent indicated above as being beyond the ambit of the Act and violative of Art. 14 of the Constitution.

50. Before parting with the matter I would like to refer to the manner in which this important and complicated measure came to be enacted. It cannot be doubted that the 11 sponsoring State Legislatures passed their resolutions under Article 252 (1) with a laudable object namely, to clothe the Parliament with legislative. competence to enact a law for the imposition of ceiling on urban immovable property for the country as a whole. Though initially a model bill based on the recommendations made by the Working Group in its Report dated July 25, 1970 had been prepared where ceiling was proposed to be imposed on urban property on the basis of monetary value, Parliament later on realised that the implementation of that proposal was beset with several practical difficulties indicated in the Approach Paper prepared by a Study Group, and, therefore, it was thought that ceiling in respect of built-up properties should be brought about through some fiscal arid other measures and ceiling on vacant land in urban agglomerations on the lines of the impugned Act should be undertaken. In other words, State-wise deep consideration and consultation for over five years had preceded the preparation of the draft Bill and this Court in V. B. Chowdhari’s case (supra) has upheld the legislative competence of Parliament to enact such a measure as a first step towards eventual imposition of ceiling on immovable properties of every other description. However, after the introduction of the Bill on the floor of the House on January 28, 1976, the enactment as drafted in its present form seems to have been rushed through the attenuated Parliament during the Emergency in less than seven hours on February, 1976. The Lok Sabha debates clearly show: (a) that the Bill was moved and taken up for consideration at 11.17 hours on that day, (b) that a motion moved by a member that the Bill be circulated or the purpose of eliciting opinion thereon by May 15, 1976 was negatived, (c) that another motion supported by quite a few members that the Bill be referred to a Select Committee with a view to improve the same by removing defects, deficiencies and omissions therein with instructions to the Select Committee to report by April 1 1976, was also negatived, (d) that though over 150 amendments had been moved (some of which were received by the members on the very day as speeches were in progress), an earnest request to postpone the second reading of the Bill to the following day to enable the members to consider those amendments (many of which were neither formal nor classificatory but of substance) was also turned down, and (e) that the original time schedule of six ours fixed by the Speaker for the Bill. was adhered to and the entire process (including general discussion, clause by clause reading, consideration of the several amendments and the third reading) was completed in undue haste by 18.01 hours. In Rajya Sabha also a request to refer the Bill to a Select Committee went unheeded and the entire process was completed in one day, February, 5, 1976. The result is that it has, in the absence of adequate study or discussion about the implications of various provisions thereof, turned out to be an ill-conceived and ill drafted measure. The measure was, undoubtedly, taken in hand with a view to achieve the unexceptional objectives underlying Art. 39 (b) and (c) but as shown above, the enacted provisions misfire and produce the opposite results and also damage or destroy the essential features or basic structure of the Constitution and hence duty bound I am constrained to strike down this impugned piece of purported socio-economic legislation. The legislative competence of the Parliament being still there a well-drafted enactment within the constitutional limitations on the subject would be the proper remedy.

51. I would, therefore, allow the petitions and direct issuance of the appropriate writs sought.

52. Sen, J—These writ petitions under Article 32 of the Constitution seek to challenge the constitutional validity of the Urban Land (Ceiling and Regulation) Act, 1976 on various grounds. The Act has been placed as item No. 132 in the Ninth Schedule by the Constitution (Fortieth Amendment) Act, 1976. Questions involved are of far-reaching importance affecting the national interest.

53. The history of the legislation is well known. The State Legislatures of eleven States, namely, all the Houses of the Legislatures of the States of Andhra Pradesh. Gujarat, Haryana, Himachal Pradesh, Karnataka, Maharashtra, Orissa, Punjab, Tripura, Uttar Pradesh and West Bengal considered it desirable to have a uniform legislation enacted by Parliament for the imposition of a ceiling on urban property in the country as a whole and in compliance with Cl. (1) of Art, 252 of the Constitution passed a resolution to that effect. Parliament accordingly enacted the Urban Land (Ceiling and Regulation) Act, 1976. In the first instance, the Act came into force on the date of its introduction in the Lok Sabha, that is, January 28, 1976 and covered Union Territories and the eleven States which had already passed the requisite Resolution under Article 252 (1) of the Constitution. Subsequently, the Act was adopted, after passing resolutions under Article 252 (1) of the Constitution by the State of Assam on March 25, 1976, and those of Bihar on April 1, 1976, Madhya Pradesh on September 9, 1976, Manipur on March 12, 1976, Meghalaya on April 7, 1976 and Rajasthan on March 9, 1976. Thus, the Act is in force in seventeen States and all the Union Territories in the country.

54. The legislative competence of Parliament to enact the Urban Land (Ceiling and Regulation) Act, 1976 having been upheld by this Court in Union of India v. Valluri Basavaiah Chaudhary, (1979) 3 SCR 802 there, remains the question of its constitutional validity.

55. Schedule I to the Act list out all States, irrespective of whether or not they have passed a resolution under Art. 252 (1) authorizing the Parliament to enact a law imposing a ceiling on urban immovable property, and the urban agglomerations in them having a population of two lacs or more. The ceiling limit of vacant land of metropolitan areas of Delhi, Bombay, Calcutta and Madras having. a population exceeding ten lacs falling under category ‘A’ is 500 sq. metres; urban agglomerations with a population of ten lacs and above, including the four metropolitan areas falling under category ‘B’ is 1000 sq. metres; urban agglomerations with a population between three lacs and ten lacs falling under category ‘c’ is 1500 sq. metres and urban agglomerations with a population between two lacs and three lacs falling under category ‘D’ is 2000 sq. metres. The schedule does not mention the urban agglomerations having a population of one lac and above; but if a particular State which passed a resolution under Art. 252 (1), or if a State which subsequently adopts the Act, wants to extend the Act to such areas, it could do so by a notification under S. 2 (n) (B) or S. 2 (n) (A) (ii), as the case may be after obtaining the previous approval of the Central Government.

56. The primary object and the purpose of the Urban Land (Ceiling and Regulation) Act, 1976, ‘the Act’, as the long title and the preamble show, is to provide for the imposition of a ceiling on vacant land in urban agglomerations, for the acquisition of such land in excess of the ceiling limit, to regulate the construction of buildings on such land and for matters connected therewith, with a view to preventing the concentration of urban land in the hands of a few persons and speculation and profiteering therein, and with a view to bringing about an equitable distribution of land in urban agglomerations to subserve the common good, in furtherance of the Directive Principles of State Policy under Art. 39 (b) and (c).

57. The Statement of Objects and Reasons accompanying the Bill reads as follows:

“There has been a demand for imposing a ceiling on urban property also, especially after the imposition of a ceiling on agricultural lands by the State Governments. With the growth of population and increasing urbanisation, a need for orderly development of urban areas has also been felt. It is, therefore, considered necessary to take measures for exercising social control over the scarce resource of urban land with a view to ensuring its equitable distribution amongst the various sections of society and also avoiding speculative transactions relating to land in urban agglomerations. With a view to ensuring uniformity in approach Government of India addressed the State Governments in this regard, eleven States have so far passed resolutions under Art. 252 (1) of the Constitution empowering Parliament to undertake legislation in this behalf.”

58. The Act consists of five Chapters. Chapter I contains the short title and the extant clause and Chapter II contains Section 2, which is the definition section. Chapter III deals with ‘Ceiling on Vacant Land’. Chapter IV deals with ‘Regulation of transfer and use of urban land’ and Chapter V contains miscellaneous provisions.

59. There can be no doubt that the legislative intent and object of the impugned Act was to secure the socialisation of vacant land in urban agglomerations with a view to preventing the concentration of urban lands in the hands of a few persons, speculation and profiteering therein, and with a view to bringing about an equitable distribution of land in urban agglomerations to subserve the common good, in furtherance of the Directive Principles of State Policy under Art. 39 (b) and (c). The Act mainly provides for the following:

(i) imposition of a ceiling on both ownership and possession of vacant land in urban agglomerations under S. 3, the ceiling being on a graded basis according to the classification of the urban agglomerations under S. 4;

(ii) acquisition of the excess vacant land by the State Government under S. 10 (3), with powers to dispose of the vacant land with the object to subserve the common good under Section 23;

(iii) payment of an amount for the acquisition of the excess land in cash and in bonds under S. 14 (2), according to the principles laid down in S. 11 (1) subject to the maximum specified in S.11. (6);

(iv) granting exemptions in respect of vacant land in certain cases under Ss. 20 and 21;

(v) regulating the transfer of vacant land within the ceiling limits under S. 26;

(vi) regulating the transfer of urban or urbanisable land with any building (whether constructed before or after the commencement of the Act for a period of ten years from the commencement of the Act or the construction of the building whichever is later under S. 27;

(vii) restricting the plinth area for the construction of future residential buildings under S. 29; and

(viii) other procedural and miscellaneous matters.

60. The Act is thus intended to achieve the following objectives: (1) to prevent the concentration of urban property in the hands of a few persons and speculation and profiteering therein (2) to bring about socialisation of urban land in urban agglomerations to subserve the common good to ensure its equitable distribution, (3) to discourage construction of luxury housing leading to conspicuous consumption of scrace building materials, and (4) to secure orderly urbanisation. Thus the dominant object and purpose of the legislation is to bring about socialisation or urban land.

61. In order to appreciate the rival contentions, it is necessary to set out the relevant provisions:Section 3 which is all important for the purpose of these writ petitions, provides:

“3. Except as otherwise provided in this Act, on and from the commencement of this Act, no person shall be entitled to hold any vacant land in excess of the ceiling limit in the territories to’ which this Act applies under sub-section (2) of Section 1”.

62. Section 4 divides the urban agglomerations into four broad categories, categories A, B, C and D, and fixes the ceiling limits varying from five hundred sq. metres in Category A to two thousand sq. metres in Category D thereof. The word ‘person’ is defined in S. 2 (i) as:

“2 (i) “person” includes an individual, family, a firm, a company, or an association or body of individuals, whether incorporated or not.”

The definition of the word ‘family’ in S. 2 (f) is in the following terms:

“2 (f) “family “ in relation to a person, means the individual, the wife or husband, as the case may be, of such individual and their unmarried minor children. “

In order that the burden of compensation, that is, the amount payable for such excess vacant lands by the Government, may not be high, the Act incorporates a specific provision, namely, sub-section (1) of S. 11 which fixes the amount broadly on the following basis: (1) eight and onethird of the annual net income from the land during the last five years or where such annual income is not being derived, at rates not exceeding ` 10/- per sq. metre or ` 5/- per sq. metre in Categories A and B, and C and D urban agglomerations respectively, classifying the area into different zones. There is also a ceiling on the maximum amount payable in any single case placed by sub-sec. (6) of S. 11. Sub-section (1) of S. 27 provides for the freezing of all transfers of urban land with or without a building or portion of a building in all agglomerations for a period of ten years from the date of the commencement of the Act or from the date on which the building is constructed.

63. The constitutional validity of the Act which has been placed in the Ninth Schedule by the Fortieth Amendment, is challenged principally on the, ground that, firstly, it is violative of the fundamental rights guaranteed under Arts. 14, 19 (1) (f) and 31 (2), since it seeks to alter the “basic structure” of the Constitution as formulated by this Court in Kesavananda Bharati v. State of Kerala (1973) Suppl. SCR 1- and, therefore, has not the protective umbrella of Art. 3IB, and secondly that it is a law in negation of, and not in furtherance of the Directive Principles of State Policy under Art. 39 (b) and (c) and is, therefore, not protected under Art. 31C.

64. In Waman Rao, v. Union of India (1980) 3 SCC 587, this Court by its order, in the context of the decision in Kesavananda Bharati’s case, has laid down:

“Amendments to the Constitution made on or after April 24, 1973 by which the 9th Schedule to the Constitution was amended from time to time by the inclusion of various Acts and Regulations therein, are open to challenge on the ground that they, or any one or more of them, are beyond the constituent power of the Parliament since they damage the basic or essential features of the Constitution or its basic structure. We do not pronounce upon the validity of such subsequent constitutional amendments except to say that if any Act or Regulation included in the 9th Schedule by a constitutional amendment made after April 24, 1973 is saved by Article 31C as it stood prior to its amendment by the 42nd Amendment, the challenge to the validity of the relevant Constitutional Amendment by which that Act or Regulation is put in the 9th Schedule, on the ground that the Amendment damages or destroys a basic or essential feature of the Constitution or its basic structure as reflected in Articles 14, 19 or 31, will be. come otiose.

Article 31-C of the Constitution as it stood prior to its amendment by Section 4 of the Constitution (42nd Amendment) Act, 1976, is valid to the extent to which its constitutionality was upheld in Kesavananda Bharati. Article 31-C, as it stood prior to the Constitution (42nd Amendment) Act does not damage any of the basic or essential features of the Constitution or its basic structure.”

65. The validity of the impugned Act is challenged on four grounds, namely (I) the inclusion of an artificial definition of ‘family’ in S. 2 (f) results in total exclusion of a joint Hindu family from the purview of the Act and also in adoption of a double standard between a family with major sons, each of whom is a separate unit by himself, and a family with minor children, which constitutes a family unit for fixing a ceiling and thus S. 3 of the impugned Act offends against the equal protection clause in Art. 14, as persons similarly situate are differentially treated without any rational basis; (2) the impugned Act is inconsistent with, takes away and abridges the fundamental right guaranteed under Art. 31 (2) inasmuch as the fixation of the maximum amount payable under sub-s. (6) of S. 11, makes the Act confiscatory or at any rate, the amount payable illusory; (3) sub-section (1) of S. 27 of the Act freezing all transfers by way of sale, mortgage, gift, lease for a period exceeding ten years or otherwise, of any urban or urbanisable land with a building (whether constructed before or after the commencement of the Act), or a portion of such building, for a period of ten years from such commencement or from the date on which the building is constructed, whichever is later, except with the previous permission in writing of the competent authority, even though such vacant land in an urban agglomeration is within the ceiling limits, is an unreasonable restriction on the fundamental right to property guaranteed under Article 19 (1) (f); and (4) the ‘priorities’ laid down in S. 23 of the impugned Act are not in keeping with Part IV of the Constitution and, therefore, liable to be struck down. It is urged upon these grounds that the impugned Act is flagrantly violative of those aspects of the petitioners’ fundamental rights under Arts. 14, 19 and 31 as constitute the basic structure or framework of the Constitution; and therefore, it is not protected under Art. 31B or 31C.

66. Land in urban areas is a vital physical resource capable of generating and sustaining economic and social activities. It should be properly utilised by the community for social good. But the attraction of urban areas has led to profiteering and racketeering in land in these areas. There is also mis-application of this scarce resource of urban land for undesirable purposes. Therefore, a comprehensive policy of effective control of land covering its use, distribution amongst the various sections of the society and individuals and for different social purposes, and its disposal by owners subject to their sharing the profits with the community at large, has been evolved. The Act has been designed to benefit the weaker sections of the community. It also grants exemptions in favour of public institutions and cooperative housing. The imposition of ceiling on land and plinth area of future dwelling units, and regulation of transfer of urban property under the Act, seeks to achieve the objective of social control over the physical resources of land. A unique feature of the Act is that it covers seventeen States and all the Union Territories and provides for aggregation of holdings in urban agglomerations in the different States where the law is applicable for purposes of ceiling limits. In other words, persons holding vacant lands or vacant and other built-up property with dwelling units therein in different urban agglomerations throughout the country will have to make a choice of retaining only one piece of vacant land within the ceiling limit and surrender excess vacant lands elsewhere. Since the Act applies to firms, companies, and undertakings, future construction of industrial or commercial premises requiring large areas cannot take place in the notified urban agglomerations without obtaining the requisite land from the Government. This enables Government to regulate and canalise the location of industries and thus serve the broad policy approach in dispersal of economic activity. Hoarding of land by industrialists based on prospects for expansion in the distant future, is thus sought to be avoided.

67. The fundamental issue is:Whether S. 23 of the impugned Act impairs the basic structure or framework of the Constitution being violative of Art. 39 (b) and (c) and Art. 31 (2) of the Constitution and is, therefore, not protected under Arts. 31-B and 81-C.

68. The impugned Act is designed as a law for the imposition of a ceiling on vacant land in urban agglomerations, for the acquisition of such land in excess of the ceiling limit to regulate the construction of buildings on such land and for matters connected therewith, with a view to preventing the concentration of urban land in the hands of a few persons, and speculation and profiteering therein, and with a view to bringing about an equitable distribution of land in urban agglomerations to subserve the common good, in furtherance of the Directive Principles under Art. 39 (b) and (c). The constitutional validity of S. 23 of the Act depends on whether in truth and substance these objectives have been translated into action. Section 23 of the Act reads:

“23. (1) It shall be competent for the State Government to allot, by order, in excess of the ceiling limit any vacant land which is deemed to have been acquired by the State Government under this Act or is acquired by the State Government under any other law, to any person for any purpose relating to, or in connection with, any industry or for providing residential accommodation of such type as may be approved by the State Government to the employees of any industry and it shall be lawful for such person to hold such land in excess of the ceiling limit.

Explanation.- For the purpose of this section, –

(a) where any land with a building has been acquired by the State Government under any other law and such building has been subsequently demolished by the State Government, then, such land shall be deemed to be vacant land acquired under such other law:

(b) “industry” means any business, profession, trade, undertaking or manufacture.

(2) In making an order of allotment under sub-section (1), the State Government may impose such conditions as may be specified therein including a condition as to the period within which the industry shall be put in operation or, as the case may be, the residential accommodation shall be provided for:Provided that if, on a representation made in this behalf by the allottee, the State Government is satisfied that the allottee could not put the industry in operation, or provide the residential accommodation, within the period specified in the order of allotment, for any good and sufficient reason, the State Government may extend such period to such further period or periods as it may deem fit.

(3) Where any condition imposed in an order of allotment is not complied with by the allottee, the State Government shall, after giving an opportunity to the allottee to be heard in the matter, cancel the allotment with effect from the date of the non-compliance of such condition and the land allotted shall revest in the State Government free from all encumbrances.

(4) Subject to the provisions of sub-sections (1), (2) and (3), all vacant lands deemed to have been acquired by the State Government under this Act shall be disposed of by the State Government to subserve the common good on such terms and conditions as the State Government may deem fit to impose.

(5) Notwithstanding anything contained in sub-sections (1) to (4), where the State Government is satisfied that it is necessary to retain or reserve any vacant land, deemed to have been acquired by that Government under this Act, for the benefit of the public, it shall be competent for the State Government to retain or reserve such laud for the same.”

69. The submission is that though the impugned Act is designed as a law for the imposition of a ceiling on vacant land in urban agglomerations, to subserve the common good, in furtherance of the Directive Principles under Art. 39 (b) and (c), the dominant object of the impugned Act for the acquisition of vacant land in urban agglomerations under S. 23 of the Act, was to facilitate the setting up of industries in the private sector and, therefore, the Act was not in furtherance of Part IV of the Constitution and void being violative of Art. 31 (2). It was urged that S. 23 of the impugned Act must, therefore, be struck down as unconstitutional, it being not in keeping with Part IV of the Constitution was not protected under Art. 31-C and that it cannot also have the protective umbrella of Art. 31-B as it seeks to alter the basic structure of the Constitution.

70. Although the impugned Act is enacted with a laudable object, to subserve the common good, in furtherance of the Directive Principles of State Policy under Art. 39 (b) and (c), it appears from the terms of sub-ss. (1), (2) and (3) of S. 23 that it would be permissible to acquire vacant land in urban agglomerations and divert it for private purposes. The whole emphasis is on industriallsation. The opening words in S. 28 (4) “subject to the provisions of sub-sections (1), (2) and (3)” make the provisions of Section 23 (4) subservient to S. 23 (1) which enables the Government to allot vacant land in an urban agglomeration to any person for any purpose relating to, or in connection with, any industry or for providing residential accommodation of such type as may be approved by the State Government to the employees of any industry. It further makes it lawful for the allottee, that is, the industrialist, to hold such land in excess of the ceiling limit. The definition of the word ‘industry’ in Explanation (b) to S. 23 (1) is wide enough to include any business, profession, trade, undertaking or manufacture and necessarily includes the private sector. The proviso to S. 23 (2) fortifies that construction of mine. It is incomprehensible that vacant lands in all urban agglomerations throughout the country should be acquired for the purpose of setting up industries. More so, as it is permissible to allow setting up of industries for private gain. There is no material placed before us showing that the Government has prepared any blueprint for industrialisation of all the urban agglomerations in India in the public sector.

71. In fact, faced with this difficulty, the learned Attorney General attempted to justify the provisions contained in S. 23 by submitting that the opening words in S. 23 (4) “subject to the provisions of sub-sections (1), (2) and (3)” must, in the context of the preamble and the Directive Principles under Art. 39 (b) and (c), be construed to mean “notwithstanding anything to the contrary contained to sub-sections (1), (2) and (3)”. According to him, the “brooding spirit” of the Preamble permeates through the entire section, and, therefore, the provisions of S. 23 of the Act should be read in the light of the preamble. The contention cannot be accepted. When the language of the section is clear and explicit, its meaning cannot be controlled by the preamble. It is not for the Court to re-structure the section. The re-structuring of a statute is obviously a legislative function. The matter is essentially of political. expediency, and as such it is the concern of the statesmen and, therefore, the domain of the legislature and not the judiciary.

72. It was, however, urged that Section 23 (1) of the Act is only an enabling provision, and the real power was under S. 23 (4), and if there is ambiguity in the language of S. 23, it was possible to read the section in the light of the preamble and the Directive Principles under Article 39 (b) and (c) and as such S. 23 (1) is subject to S. 23 (4). The use of the words “subject to the provisions of sub-sections (1), (2) and (3)” in S. 23 (4) takes away the compulsion on the State Government to adhere to the Directive Principles under Art. 39 (b) and (c) in making allotment of the vacant lands in an urban agglomeration acquired under the Act. The words “subject to the provisions of sub-sections (1), (2) and (3)” in S. 23 (4), appearing in the context of Section 23 (1) means ‘in addition to,’ if anything is left over after the allotment, under S. 23 (1). I cannot, therefore, read the provisions of sub-ss. (1), (2) and (3) of S. 23 in the light of the preamble or the Directive Principles under Art. 39 (b) and (c). By no rule of construction can the operation of sub-s. (1) of S. 23 of the Act be controlled by the operation of subsection (4).

73. A legislation built on the foundation of Art. 39 (b) and (c) permitting acquisition of private property must be for a public purpose, that is, to subserve the common good. In my view, sub-ss. (1), (2) and (3) of S. 23 of the Act negate that principle. Furthermore, Art. 31 (2) consists of three pre-requisites namely (i) the property shall be acquired by or under a valid law, (ii) it shall be acquired only for a public purpose, and (iii) the person whose property has been acquired shall be given an amount in lieu thereof. The definition of ‘industry’ in Explanation (b) to S. 23 (1) is wide enough to include any business, trade or vocation carried on for private gain. There cannot be ‘mixed purpose of public and private to sustain a legislation under Art. 39 (b) and (c). The vice lies in S. 23 (1) and the Explanation (b) thereto, which on a combined reading, frustrate the very object of the legislation.

74. One is left with the feeling that sub-ss. (1), (2) and (3) of S. 23 of the impugned Act are meant to promote the interests of the business community and further professional interests, While setting up of an industry in the private sector may, at times, be for the public good, there cannot be acquisition of private property for private gain. Acquisition or requisition can only be for a ‘public purpose’. That is to say, a purpose, an object or aim in which the general interest of the community as opposed to the particular interest of the individual, is directly and vitally concerned. The concept of ‘public purpose’ necessarily implies that it should be a law for the acquisition or requisition of property in the interest of the general public, and the purpose of such a law directly and vitally subserves public interest. If in reality the object of the acquisition under the Act is to set up industries in the private sector as is permissible from the provisions of S. 23 (1) of the Act, nothing prevents the State from taking recourse to S. 40 of the Land Acquisition Act, 1894, for which there, must be quid pro quo, that is, payment of compensation according to the market value.

75. Our attention was drawn to the guidelines issued by the Government of India, Ministry of Works and Housing clarifying the intent and purpose of the provisions of the Act. It may be stated here that these guidelines cannot supersede or alter any of the provisions of the Act or the rules made thereunder. The guidelines issued under S. 23 are in these terms:

“Section 23 of the Urban Land (Ceiling and Regulation) Act, 1976, governs, inter alia, disposal of vacant land acquired under the Act. In brief, this Section enables the State Government to allot any vacant land for the purpose of an industry or to subserve the common good, or to retain or reserve such land for the benefit of the public.

2. For the purpose of this Section ‘industry’ has been given a wider meaning so as to cover any business, profession, trade, undertaking or manufacture.

3. The section also enables Government to allot land for providing residential accommodation of such type as may be approved by the State Government to the employees of any industry. Thus the excess vacant land acquired by the State Government under the Act can be dealt with in the following manner:

(i) allotted for the purpose of an industry namely, any business, profession, trade, undertaking or manufacture;

(ii) allotted for the purpose of construction of houses for the employees of an industry specified in item (i) above; (iii) disposed of to subserve the common good which may include allotment of vacant land for Government purpose, for institutions, etc., and

(iv) retained/reserved for the benefit of the public.”

It appears that the Government issued the following guidelines pursuant to the recommendations made at a conference of State Ministers of Housing and Urban Development with a view to implement the policy of socialisation of urban land:

“The 9th Conference of State Ministers of Housing and Urban Development held at Calcutta on the 17th, 18th and 19th December, 1976, considered the matter and recommended that, in order to bring about social objectives of the Act more prominently, the utilisation of the excess vacant land should be according to the priorities set down below subject to the prescribed land uses:

(i) Retain/reserve for the benefit of the public for social housing, provision of basic amenities, etc.

(ii) Dispose of to subserve common good which may include allotment of vacant land for Government purposes local authorities, institutions, etc.

(iii) Allot for the purpose of construction of houses for the employees of industries specified in item (iv) below.

(iv) Allot for the purpose of industry, viz., any business, profession, trade, undertaking of non-polluting manufacture; cottage and small scale and wherever possible ancillary industry, manufacture.”

76. It is significant to notice that there was an attempt made in these aforesaid guidelines to alter the ‘priorities’ laid down in S. 23. The guidelines cannot alter the ‘priorities’ laid down in the section. The guidelines are nothing but in the nature of executive instructions and cannot obviously control the plain meaning of the section. Where the language of the Act is clear and explicit, we must give effect to it, whatever may be the consequences, for in that case the words of the statute speak the intention of the legislature. (Craies on Statute Law, 6th ed., p. 66) The Court cannot be called upon to interpret the provisions of S. 23 of the Act in the light of the guidelines issued by the Government of India, Ministry of Works and Housing.

77. I am, therefore, constrained to hold that the provisions of sub-ss. (1), (2) and (3) of S. 23 and the opening words “subject to the provisions of sub-sections (1), (2) and (3)” in S. 23 (4) which make the setting up of industries the dominant object for the acquisition of vacant land in urban agglomerations under the Act, are not in keeping with Part IV of the Constitution ant therefore, not protected under Art. 31-C.

78. A legislation which directly runs counter to the Directive Principles of State Policy enshrined in Art. 39 (b) and (c) cannot by the mere inclusion in the Ninth Schedule receive immunity under Art. 31-B. The Directive Principles are not mere homilies. Though these Directives are not cognizable by the Courts and if the Government of the day fails to carry out these objects no Court can make the Government ensure them, yet these principles have been declared to be fundamental to the governance of the country. Granville Austin (Granville Austin – The Indian Constitution:Cornerstone of a Nation, pp. 50-52) considers these directives to be aimed at furthering the goals of the social revolution or to foster this revolution by establishing the conditions necessary for its achievement. He explains:

“By establishing these positive obligations of the State, the members of the Constituent Assembly made if the responsibility of future Indian governments to find a middle way between individual liberty and the public good, between preserving the property and the privilege of the few and bestowing benefits on the many in order to liberate ‘the powers of all men equally for contributions to the common good.’ “

79. In short, the directives emphasise, in amplification of the Preamble, that the goal of the Indian polity is not laissez faire, but a welfare State, where the State has a positive duty to ensure to its citizens social and economic justice and dignity of the individual. It would serve as an ‘Instrument of Instructions’ upon all future governments, irrespective of their party creeds.

80. Article 38 requires that the State should make an effort to promote the welfare of the people by securing and protecting as effectively as it may a social order in which justice, social, economic and political, shall inform all the institutions of the national life. In other words, the promise made by the Constitution to the citizens of India in its Preamble is directive included in one of the directive principles of State policy. Art. 39, Cl. (a) requires that all citizens shall have a right to adequate means of livelihood. Article 39 (b) enjoins that the State shall ensure that the ownership and control of the material resources of the community are so distributed as best to subserve the common good. Article 39 (c) mandates that the State shall direct its policy towards securing that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment, Dr. P. B. Gajendragadkar in ‘Law, Liberty and Social justice’ , observes:

“These directive principles very briefly, but eloquently, lay down a policy of action for the different State Governments and the Central Government, and in a sense, they embody solemnly and recognise the validity of the charter of demands which the weaker sections of the citizens suffering from socio-economic injustice would present to the respective governments for immediate relief.”

81. Chandrachud J. (as he then was) in Smt. Indira Gandhi v. Raj Narain (1976) 2 SCR 347 after observing that the ratio of the Majority in Kesavananda Bharati’s case were merely illustrative of what constitutes the basic structure and are not intended to be exhaustive, observes:

“………………. I consider it beyond the pale of reasonable controversy that if there be any unamendable features of the Constitution on the score that they form a part of the basic structure of the Constitution, they are that: (i) India is a Sovereign Democratic Republic; (ii) Equality of status and opportunity shall be secured to all its citizens, (iii) The State shall have no religion of its own and all persons shall be equally entitled to freedom of conscience and the right freely to profess, practise and propagate religion and that (iv) the Nation shall be governed by a Government of laws, not of men. These, in my opinion, are the pillars of our constitutional philosophy, the pillars therefore of the basic structure of the Constitution.”

82. According to him, the pillars of the Constitution are Sovereign Democratic Republic, Equality of Status and Opportunity, Secularism, Citizen’s right to religious worship, and the Rule of Law. With respect, I would add that the concept of social and economic justice to build a Welfare State-is equally part of the basic structure or the foundation upon which the Constitution rests. The provisions of sub-ss. (1), (2) and (3)” of Section 23 and the opening words “subject to the provisions of sub-sections (1), (2) and (3)’ in Section 23 (4) are the very antithesis of the idea of a Welfare State based on social and economic justice. Since these provisions permit acquisition of property under the Act for private purposes, they offend against the Directive Principles of State Policy of Art. 39 (b) and (c) and are also violative of Article 31 (2) and therefore, not protected under Art. 31B.

83. I would, therefore, declare that the provisions of sub-sections (1), (2) and (3) of S. 23 and the opening words “subject to the provisions of sub-sees. (1), (2), and (3)” in Section 23 (4) are ultra vires of the Parliament.

84. With the striking down of the invalid provisions what remains, that is, the remaining provisions of the impugned Act, including S. 23 (4) thereof, being in conformity with Part IV of the Constitution and Article 31 (2), are valid and, therefore, the impugned Act has the protection of both Article 31-B and Article 31-C.

85. I find no justification to strike down the whole Act as it would be against the national interest. Unless it becomes clear beyond reasonable doubt that the legislation in question transgresses the limits of the organic law of the Constitution it must be allowed to stand as the true expression of the national will. The provisions of sub-ss. (1), (2) and (3) of Section 23 and the opening words “subject to the provisions of sub-sections (1), (2) and (3)” in S. 23 (4), which are, in my view, invalid, cannot affect the validity of the Act as a whole. The test to be applied when an argument like the one addressed in this case is raised, has been summed up by the Privy Council in Attorney-General for Alberta v. Attorney General for Canada, 1947 AC 503 at page No. 581 in these words:

“The real question is whether what remains is so inextricably bound up with the part declared invalid that what remains cannot independently survive or, as it has sometimes been put, whether on a fair review of the whole matter it can be assumed that the legislature would have enacted what survives without enacting the part that is ultra vires at all.”

It is quite clear that the provisions of sub-ss. (1), (2) and (3) of S. 23 and the opening words “subject to the provisions of sub-sections (1), (2) and (3)” in S. 23 (4) struck down by me are not inextricably bound up with the remaining provisions of the Act, and it is difficult to hold that the legislature would not have enacted the Act at all without including that part which is found to be ultra vires. The Act still remains the Act as it was passed, i. e., an Act for imposition of ceiling on urban land.

86. In determining the effect of the law upon the individual’s right to property, the Court must take judicial notice of the fact of vast inequalities in the existing distribution of property in the country. The Court’s concern lies not merely with applying the pre-existing sets of theories, concepts, principles and criteria with a view to determining what the law is on a particular point. The proper approach should be to view the principles with the realisation that the ultimate foundation of the Constitution finds its ultimate roots in the authority of the people. This demands that constitutional questions should not be determined from a doctrinaire approach, but viewed from experience derived from the life and experience or actual working of the community, which takes into account emergence of new facts of the community’s social and economic life affecting property rights of the individual, whenever, among others, the validity of a law prescribing preference or discrimination is in question under the “equal protection” guarantee.

87. It should be remembered that the directive principles cannot be regarded only as idle dreams or pious wishes merely by reason of the fact that they are not enforceable by a court of law. A rule of law in fact does not cease to be such because there is no regular judicial or quasi-judicial machinery to enforce its commands. An attempt to create a truly social Welfare State also carries with it the idea that in a country like India concentration of wealth in the country must be done away with and its distribution on an. equitable basis effected in order to bridge the gap between the rich and the poor. The very purpose of creating such a State is to benefit the weaker and poorer sections of the community to a much greater extent than the rich persons so that the living standards of the people in general may improve. In fact, in such a State, all welfare schemes in their operation generally tend to benefit the poor people to a much greater extent than others. If an equal protection guarantee were enough to invalidate such schemes, improvement in the economic and social conditions of the country would be impossible. One should not be swayed away by emotions but should be guided by the real needs of the country. Hence a paradoxical situation should be avoided by refusing to perpetuate the existing inequality among the social classes and maintain that gap to the same extent as before by intending to pay to the rich compensation at the same full rates as in the case of the poorer sections of the community.

88. The impugned Act is meant to remove inequalities with a view to promote ‘the greatest happiness of the greatest number’. During the last thirty years much has been done to implement the State’s policy of socialisation of agricultural land by imposition of a ceiling on agricultural holdings. There is much that till remains to be done. There is need for prevention of concentration of wealth in a few hands in the urban areas and to provide for equitable distribution of vacant land among others. The great disparity between the rich and the poor is more visible in the urban areas particularly in the great cities. A majority of the people in the urban areas are living in abject poverty. They do not even have a roof over their heads. Concentration of wealth in a few hands is not conducive to the national well being.

89. The challenge to the validity of the artificial definition of ‘family’ in Section 2 (f) of the impugned Act must fail. The Court has recently upheld the validity of an identical definition of ‘family’ appearing in the different State laws relating to imposition of ceiling on agricultural land. Some marginal hardship is inevitable in the working of the legislation. The ultimate object is to reduce inequalities in the larger interest. That takes us to the question whether the definition of ‘family’ in S. 2 (f) of the Act results in the exclusion of a joint Hindu family.

90. The definition of ‘family’ contained in S. 2 (f) is in the following terms:

“2. (f) “family” in relation to a person, means the individual, the wife or husband, as the case may be, of such individual and their unmarried minor children”

As a result of the artificial definition of ‘family’ in S. 2 (f), there is no denying the fact that a joint Hindu Family is excluded from the purview of the Act. S. 3 of the Act provides that no person, on and from the commencement of the Act, shall be entitled to hold any vacant land in excess of the ceiling limit in the territories to which the Act applied. The word ‘person’ is defined in S. 2 (i) as:

“2. (i) “person” includes an individual, a family, a firm, a company, or an association or body of individuals, whether incorporated or not:

91. The question is whether the total exclusion of joint Hindu family renders the Act void and unconstitutional as violative of Art. 14. I do not think that this is so. Parliament deliberately excluded a joint Hindu family from the purview of S. 3 of the impugned Act. As already pointed out in Basavaiah Chaudhary’s case, (supra) Parliament was beset with difficulties in imposing a ceiling on urban immovable property. While dealing with imposition of ceiling on vacant urban land it was presumably faced with another difficulty, viz., the institution of a joint Hindu family. According to the Mitakshara School of Hindu Law, there is community of interest and unity of possession. Under the Mitakshara School a coparcener cannot predicate the extent of his share, while under the Dayabhaga School a member of joint Hindu family takes as a tenant in common. We, therefore, do not find anything wrong in excluding a joint Hindu family. The impugned Act applies to Hindus, Mohamedans and Christians alike. By the exclusion of a joint Hindu family the members of a joint Hindu family, whether governed by the Mitakshara School or the Dayabhaga School were brought at par with others. The contention that the impugned Act offends against Art. 14 must, therefore, fail.

92. The contention that the amount fixed by sub-section (6) of S. 11 of the impugned Act is totally arbitrary and illusory since there is no nexus between the value of the property and the amount fixed and, therefore, the maximum amount fixed under sub-section (6) makes the Act confiscatory in total abrogation of the fundamental right guaranteed under Art. 31 (2) cannot be accepted. The Constitution (25th Amendment) Act 1971, which came into force on April 20, 1972, by Section 2 (a) substituted the word ‘amount’ for the word ‘compensation’ in the new Art, 31 (2), which reads:

“31 (2) No property shall be compulsorily acquired or requisitioned save for a public purpose and save by authority, of a law which provides for acquisition or requisitioning of the property for an amount which may be fixed by such law or which may be determined in accordance with such principles and given in such manner as may be specified in such law; and no such law shall be called in question in any court on the ground that the amount so fixed or determined is not adequate or that the whole or any part of such amount is to be given otherwise than in cash.”

Under the original Art. 31 (2), no property could be acquired for a public purpose under any law, unless it provided for compensation for the property taken possession of or acquired and either fixed the amount of the compensation, or specified the principles on which, and the manner in which, the compensation was to be determined and given.

93. It will be seen that Art. 31 (2) provides for acquisition or requisitioning of the property for an amount which may be fixed by such law, or which may be determined in accordance with such principles and given in such manner as may be specified in such law. No such law can be in question on the ground that the amount is not adequate, or that the whole or any part of it is to be given otherwise than in cash. Section 2 (b) of the 25th Amendment Act inserted a new Clause (2B) to Art. 81 which provides:

“31. (2B) Nothing in sub-Cl. (f) of Cl. (1) of Article 19 shall affect any such law as is referred to in Clause (2).

The substitution of the neutral word ‘amount’ for ‘compensation’ in the new Art. 31 (2) still binds the legislature to give to owner a sum of money in cash or otherwise. The legislature may either lay down the principles for the determination of the amount or may itself fix the amount. The choice open to the legislature is that the amount should be directly fixed by or under the law itself or alternatively, the law may fix principles in accordance with which the amount will be determined.

94. Sub-section (1) of S. 11 reads:

“11 (1) Where any vacant land is deemed to have been acquired by any State Government under sub-section (8) of Section -10, such State Government shall pay to the person or persons having any interest therein, –

(a) in a case where there is any income from such vacant land, an amount equal to eight and one-third times the net average annual income actually derived from such land during the period of five consecutive years immediately preceding the date of publication of the notification issued under sub-section (1) of S. 10; or (b) in a case where no income is derived from such vacant land, an amount calculated at a rate not exceeding-

(i) ten rupees per square metre in the case of vacant land situated in an urban agglomeration falling within category A or category B specified in Schedule I; and

(ii) five rupees per square metre in the case of vacant land situated in an urban agglomeration falling within category C or category D specified in that Schedule. In order at the burden of compensation, that is, the amount payable under Article 31 (2) for taking over vacant land in excess of the ceiling limit in sub-s. (3) of S. 10 by the government may not be high, the Act incorporates a specific provision in sub-s. (6) of S. 11 to fix a ceiling on the maximum amount payable in any single case. The sub-section reads:

“11 (6) Notwithstanding anything contained in sub-section (1) or sub-sec. (5), the amount payable under either of the said sub-sections shall, in no case, exceed two lakhs of rupees.”

It is not suggested that sub-s. (1) of Section 11 does not lay down any principles for determination of the amount payable for the taking of excess vacant lands in an urban agglomeration or that the principles laid down in sub-sec. (1) are not relevant for the determination of the amount payable. It is also not suggested that payment of the amount at the rate of ` 10/- per sq. metre and ` 5/- per sq. metre, for the vacant land in categories A and B, and categories C and D respectively, makes the amount illusory or the Act confiscatory. The submission is that the fixation of the maximum amount payable at ` 2 lacs in a single case by sub-s. (6) makes the amount payable under sub-s. (1) wholly illusory any, therefore, the Act is confiscatory. That cannot be so, because the fixation of ceiling on the maximum at ` 2 lacs under S. 11 (6) implies that it would affect only persons owning 20,000 sq. metres of vacant land in metropolitan cities like Delhi, Calcutta, Bombay and Madras or large cities like Hyderabad, Bangalore, Poona, Kanpur and Ahmedabad falling in categories A and B, or persons owning 40,000 sq. metres in big cities like Lucknow, Allahabad, Nagpur, Jaipur etc. falling in categories C and D. One is left to wonder how many own such vast tracts of vacant land in such cities. If any, very few indeed. Even if there are, the amount cannot be related to the value of the property taken. It is pure arithmetics. Twenty thousand sq. metres would make 23,920 sq. Yards and forty thousand sq. metres 47,840 sq. Yards. In a city like Delhi, Calcutta, Bombay and Madras the value of a square Yard of vacant land would depend upon the situation of the land. If that be the criteria, then there can be no ceiling on vacant land in urban agglomerations, much less ceiling on immovable property in such cities, when it comes to be imposed. The State has not the capacity to bear the burden. If the contention were to prevail, then no law for the implementation of the Directive Principles of State Policy under Art. 39 (b) or (c) can ever be implemented.

95. We may recall the words of Pandit Jawaharlal Nehru, who while introducing the Constitution (Fourth Amendment) Act, 1955, said in Parliament:

“If we are aiming, as I hope we are aiming and we repeatedly say we are aiming, at changes in the social structure, then inevitably we cannot think in terms of giving what is called full compensation. Why? Well, firstly because you cannot do it, secondly because it would be improper to do it, unjust to do it, and it should not be done even if you can do it for the simple reason that in all these social matters, laws etc., they are aiming to bring about a certain structure of society different from what it is at present. In that different structure among other things that will change is this, the big difference between the have’s and the have nots. Now, if we are giving full compensation, the have’s remain the have’s and the have not’s have-not’s. It does not change in shape or form if compensation takes place. Therefore, in any scheme of social engineering, if I may say so, you cannot give full compensation – apart from the patent fact that you are not in a position – nobody has the resources – to give it.”

96. There can be no scheme for nationalisation of any industry, there can be no socio-economic measures enacted if the concept of ‘just equivalent’ were to be introduced even after the 25th Amendment. To emphasise the point that the amount of ` 2 lacs fixed under sub-section (6) of S. 11 makes the Act confiscatory, our attention was drawn to the fact that the petitioner in Writ Petition No. 350 of 1977, Maharao Saheb Shri Bhim Singhji, the former Maharana of Kotah owns 971.50 acres of vacant land appurtenant to and covered under his Umed Bhawan Palace in the city of Kotah, which is an urban agglomeration falling under category ‘D’, and which stands requisitioned under S. 23 (1) of the Defence and Internal Security of India Act, 1971. There is no dispute that the property of the Maharana is valued for the purposes of the Rajasthan Lands and Buildings Tax Act, 1964, at Rupees 4,12,27,726.84. Does it mean that the amount should be geared to the value of the vacant land taken under sub-sec. (3) of S. 10? When the court has no power to question the adequacy of the amount under Art. 31 (2), can it be said that the amount fixed determined according to the principles laid down in sub-section (1) of S. 11, subject to the maximum fixed under sub-sec. (6) thereof is illusory merely because of inadequacy?

97. Who are we to say that it should be 10 per cent or less, or 50 per cent or more. The legislature in its wisdom has laid down the principles and fixed a ceiling on the maximum amount payable. That is a legislative judgment and the Court has no power to question it. Seervai in his book on Constitution, 2nd Ed., Vol. I, p. 656, while dealing with the Fourth Amendment states that in permitting ‘inadequate compensation’ the 4th Amendment removed a fixed yardstick and made all discussion about ‘relevant’ and ‘irrelevant’ principles meaningless. The learned author says:

“If the questions were asked, why has the law fixed compensation amounting to 60 per cent and not to 70 or 50 per cent of the market value, the answer would he that in the legislative judgment the amount fixed by the law was a fair and just compensation for the acquisition of property under that law, and if a law fixing compensation at amounts ranging from 90 to 50 per cent or less, of the market value of the property acquired, cannot be struck down by a Court, equally, principles of compensation cannot be struck down when they produce the same result. The consequences of the transformation brought about by the 4th Amendment is that ‘principles of compensation’ do not mean the same thing before and after the 4th Amendment.”

As the learned author explains, ‘considerations of social justice are imponderable and, therefore, no fixed money value can be put on them by any principle’, and goes on to say ‘The question whether the Court can go into the question whether the amount is illusory is …. difficult to answer’. The legislature considers a maximum amount of ` 2 lacs to be a fair and just recompense for the acquisition of excess vacant land in an urban agglomeration. By no standard can an amount of ` 2 lacs be considered to be illusory.

98. The 25th Amendment has placed the matter of adequacy of compensation beyond the pale of controversy by substituting the word ‘amount’ for the word ‘compensation’ in Art. 31 (2) and made the adequacy of the amount payable for acquisition or requisition of property non-justiciable.

99. In Kesavananda Bharati’s case, (supra) the Court upheld the constitutional validity of the 25th Amendment. The impact of the new Article 31 (2) was also considered as well as the content and meaning of the word ‘amount’. According to the majority, the amount fixed or determined to be paid cannot be illusory. But one thing is clear- the meaning which the Court placed on the word ‘compensation’ in R. C. Cooper’s case (supra) of adequacy of compensation and on relevant principles has been held to have been nullified by the 25th Amendment.

100. The two decisions directly in point are the State of Kerala v. The Gwalior Rayon Silk Mfg. Co., (1974) 1 SCR 671 and State of Karnataka v. Ranganatha Reddy. (1978) 1 SCR 641. In Gwalior Rayon’s case the Court upheld the validity of the Kerala Private Forests (Vesting and Assignment) Act, 1971, which provided for the vesting of private forest lands held in Janman rights, even though there was no provision for payment of compensation. The Court held that since the Act envisaged a scheme of agrarian reform, it was protected under Art. 31A and could not be challenged on the ground that it takes away, abridges or abrogates the fundamental rights guaranteed by Arts. 14, 19 and 31. In Ranganatha Reddy’s case the Court upheld a scheme for nationalisation of contract carriages in the State, since it laid down the principles for the determination of the amount payable under Art. 31 (2) and they were not irrelevant for the determination of the amount. Untwalia J. speaking for the majority observed:

“On the interpretations aforesaid which we have put to the relevant provisions of the Act, it was difficult – rather impossible – to argue that the amount so fixed will be arbitrary or illusory. In some respects it may be inadequate but that cannot be a ground for challenge of the constitutionality of the law under Article 31 (2).”

Krishna Iyer J. in a separate but concurring judgment after deducing the discernible principles from the decision in Kesavananda Bharati’s case, (supra) held that the 25th Amendment bars the Court’s jurisdiction to investigate the adequacy of the amount. In view of these two decisions, the contention that fixation of maximum amount by sub-section (6) of S. 11 renders the amount payable under sub-sec. (1) illusory or in the alternative makes the Act confiscatory cannot be accepted.

101. There still remains the contention regarding the invalidity of sub-s. (1) of S. 27, which reads:

“27. (1) Notwithstanding anything contained in any other law for the time being in force, but subject to the provisions of sub-section (3) of Section 5 and sub-section (4) of Section 10, no person shall transfer by way of sale, mortgage, gift, lease for a period exceeding ten years, or otherwise, any urban or urbanisable land with a building (whether constructed before or after the commencement of this Act) or a portion only of such building for a period of ten years of such commencement or from the date on which the building is constructed, whichever is later, except with the previous permission in writing of the competent authority.”

102. It is urged that sub-s. (1) of S. 27 confers arbitrary and uncontrolled powers on the competent authority to grant or refuse permission for transfer and that the conferral of such uncontrolled and uncanalised power without any guidelines renders the provision illegal and void and unenforceable being an unreasonable restriction on the right to acquire, hold and dispose of property guaranteed under Art. 19 (1) (f). It is said that the matter is left to the whim and fancy of the competent authority, and the power so conferred is capable of misuse and thus be an instrument of great oppression. The learned Attorney General tried to meet the contention by urging that there was no reason to think that the competent authority would refuse to grant permission where the transaction is bona fide. According to him, the competent authority would be justified in refusing to grant permission where the transaction is calculated to defeat the provisions of the Act. It is said that the whole object of freezing of the transactions was to hold the price line of urban land. He drew our attention to the guidelines issued by the Government of India, Ministry of Works and Housing to the various State Governments directing that all applications for grant of permission under sub-sec. (1) of S. 27 of the Act should be dealt with expeditiously with a view to prevent any inconvenience to the members of the public and further that permission should be granted as a matter of course, within three days of the receipt of such application.

103. In my judgment, there is no justification at all for the freezing of transactions by way of sale, mortgage, gift or lease of vacant land or building for a period exceeding ten years, or otherwise, for a period of ten years from the date of the commencement of the Act, even though such vacant land with or without building thereon falls within the ceiling limits. In Excel Wear v. Union of India, (1979) 1 SCR 1009, the Court held that their right to carry on a business guaranteed under Art. 19 (1) (g) carries with it the right not to carry on business. It must logically follow, as a necessary corollary, that the right to acquire, hold and dispose of property guaranteed to a citizen under Art. 19 (1) (f) carries with it the right not to hold any property. It is difficult to appreciate how, could a citizen be compelled to own property against his will.

104. If vacant land owned by a person falls within the ceiling limits for an urban agglomeration, he is outside the purview of S. 3 of the Act. That being so, such a person is not governed by any of the provisions of the Act. When this was pointed out to the learned Attorney General, he was unable to justify the imposition of the restriction imposed by sub-section (1) of S. 27 in case of land falling within the ceiling limits as a reasonable restriction. It must. accordingly, be held that the provision of sub-section (1) of S. 27 of the impugned Act is invalid insofar as it seeks to affect a citizen’s right to dispose of his urban property in an urban agglomeration within the ceiling limits.

105. I would, for the reasons stated, declare sub-sections (1), (2) and (3) of Section 23 and the opening words “subject to the provisions of sub-sections (1), (2) and (3)” in Section 23 (4) of the Urban Land (Ceiling and Regulation) Act, 1976 as ultra vires of the Parliament and that these provisions are not protected under Articles 31-B and 31-C of the Constitution and further declare that sub-section (1) of Section 27 of the Act is invalid insofar as it imposes a restriction on transfer of urban property for a period of ten years from the commencement of the Act in relation to vacant land or building thereon, within the ceiling limits.

106. Having struck down sub-secs. (1), (2) and (3) of Section 23 and the opening words “subject to the provision of the sub-sections (1), (2) and (3) in S. 23 (4) of the Act, I would declare the remaining provisions of the Urban Land (Ceiling and Regulation) Act, 1976, including sub-section (4) of Section 23 thereof as valid and constitutional.

107. In the result, the writ petitions, except to the extent indicated, must fail and are dismissed. There shall be no order as to costs.

Constitutional Law