Case BriefsSupreme Court

   

Supreme Court: In a case raising questions on the Constitutional validity of sub-sections (7) and (8) of Section 4 [introduced by way of the Kerala Motor Vehicles Taxation (Amendment) Act, 2005 in the Kerala Motor Vehicles Taxation Act, 1976], Section 15 of the 1976 Act and Section 8A of the Kerala Motor Transport Workers' Welfare Fund Act, 1985 inserted by Act 23 of 2005, the 3-judges Bench of A.M. Khanwilkar*, Abhay S. Oka, and C.T. Ravikumar, JJ., upheld validity of the stated amendments.

Noticeably, the effect of these amendments is to mandate the production of receipt of remittance of welfare fund contribution at the time of making payment of vehicle tax before the Taxation Officer.

Grounds for Challenge

  1. The thrust of the challenge is that the State Legislature by way of stated amendments has effectively bootstrapped the obligation to make a contribution to the workers' welfare fund with the obligation to pay tax for operating motor vehicles.

  2. The welfare legislation is intertwined with the compensatory legislation by the impugned Amendment Act of 2005 and together they substantially encroach and override the relevant provisions of the Central legislation i.e., the Motor Vehicles Act, 1988 to paralyse the Stage and Goods Carriage Operation or to undermine the effectiveness of the transport permit provided under the 1988 Act.

  3. The amendments are unconstitutional as the entire field is already occupied by the Central Act of 1988, with respect to permits to be issued for operating transport vehicles. Thus, the provisions of the State Act(s) are repugnant to the Central Act.

Findings of the High Court

The Kerala High Court opined that there was no lack of legislative competence in the State Legislature and that the 1976 Act as well as the 1985 Act, fall substantially within the powers expressly conferred upon the State Legislature which had enacted both the legislations, including the Amendment Act of 2005. It further held that merely because the 1976 Act had also dealt with a subject which falls under Entries 23 and 24 of List III of the Concurrent List, it cannot be held that the provisions of the 1976 Act are bad in law. On this analysis, the High Court rejected the challenge and dismissed the writ petitions and writ appeals vide impugned judgment.

Analysis and Findings of the Supreme Court

Whether the Impugned Amendments are Repugnancy to the Central Act?

The Court relied on Thirumuruga Kirupananda Variyar Thavathiru Sundara Swamigal Medical Educational & Charitable Trust, (1996) 3 SCC 15, to hold that it cannot be said that the test of two legislations containing contradictory provisions is the only criterion of repugnance. Repugnancy may arise between two enactments even though obedience to each of them is possible without disobeying the other if a competent legislature with a superior efficacy expressly or impliedly evinces by its legislation an intention to cover the whole field.

The Court noted that Section 81(4) of the Act, 1988 dealing with the power of the Authority to reject an application for the renewal of a permit provides for the grounds on which the renewal of a permit can be rejected which includes plying any vehicle without payment of tax due on such vehicle; and on any unauthorised route. Besides these provisions, there is nothing in the 1988 Act to deal with the manner of levy of vehicle tax or the collection thereof.

Though the 1976 Act enacted by the State Legislature is ascribable to Entries 56 and 57 of List II (State List)—Entry 56 deals with taxes on goods and passengers carried by road or on inland waterways, Entry 57 deals with taxes on vehicles, whether mechanically propelled or not, suitable for use on roads, including tramcars subject to the provisions of Entry 35 of List III under which the Parliament has already enacted 1988 Act—the Court noted that the law made by the Parliament, being 1988 Act, does not touch upon or deal with the field of the manner of levy of vehicle tax and collection thereof. Whereas, the 1976 Act enacted by the State Legislature is to consolidate and amend the laws relating to the levy of tax on motor vehicles and on passengers and goods carried by such vehicles in the State of Kerala.

Furthermore, on analysing the legislative intent and the efficacy of the impugned provisions enacted by the State Legislature concerning the manner of levy of vehicle tax and collection thereof, the Court opined that obedience to each of the laws (made by the Parliament and State Legislature) is possible without disobeying the other. Hence, arguments regarding repugnancy were held to be devoid of merit.

Bootstrapping of Liabilities of Permit-holder

Noting that the appellants had not disputed their liability to pay the vehicle tax levied under the 1976 Act as well as to pay a contribution towards the workers' welfare fund under the 1985 Act and their real grievance was about compelling them to pay the welfare contribution dues as a precondition for collection of vehicle tax, the Court held that such dispensation cannot be construed as unconstitutional.

Reverting to the 1985 Act enacted by the State Legislature, the Court opined that indisputably, it is welfare legislation ascribable to Entries 23 and 24 of List III — Concurrent List, constituting a fund to promote the welfare of motor transport workers in the State of Kerala. The 1985 Act has been enacted with the objects and reasons as a vast number of employees were being engaged in Motor Transport Industry in the State in the private sector, the Government thought it necessary to provide for the constitution of a Fund to promote the welfare of such of the motor transport workers in the private sector who are not covered by the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and the Payment of Gratuity Act, 1972.

Thus, rejecting the plea of the appellants, the Court stated,

“It is beyond comprehension that the vehicle owner/permit-holder can be heard to argue that he would not pay the dues under the 1985 Act and, yet, would continue with the business of motor transport as usual in the State of Kerala by exploiting the workers on the specious plea that the validity of the permit to operate transport vehicle cannot be interdicted under a State legislation.”

The Court further observed that even in the 1988 Act, the permit-holder is obliged to ensure that the vehicle tax is paid regularly and the stipulation in the 1985 Act is in the nature of ensuring that the vehicle owner/permit-holder discharges both the liabilities and does not commit default in contributing to the welfare fund as also pay vehicle tax on time.

Verdict

In the light of above, the Court concluded that the provisions of the 1976 Act and the 1985 Act, enacted by the State Legislature, are only intended to ensure that the vehicle owner/permit-holder does not remain in arrears of either the welfare fund contribution or the vehicle tax both payable under the State enactments. And that there is nothing wrong with State Legislature making it compulsory to pay outstanding welfare fund contribution first before accepting the vehicle tax which had become due and payable.

In view of the above, the impugned judgment of the High Court was upheld, and the appeals were dismissed with costs.

[All Kerala Distributors Assn. v. State of Kerala, 2022 SCC OnLine SC 919, decided on 27-07-2022]

*Judgment by: Justice A.M. Khanwilkar


Advocates who appeared in this case :

For the Appellants: Senior Advocate K. Radhakrishnan, and Advocate K. Parameshwar

For the State of Kerala: Advocate Abraham Mathews

For Kerala Motor Transport Workers Welfare Fund Board: Senior Advocate P.N. Ravindran


*Kamini Sharma, Editorial Assistant has put this report together.

Case BriefsSupreme Court

Supreme Court: In a case where challenge was made to declare Section 50(a) of the Delhi Land Reforms Act, 1954 unconstitutional being ultra vires Articles 14, 15, 254 and 21 of the Constitution of India, the bench of Hemant Gupta and Vikram Nath*, JJ has held that all the legislations included in the Ninth Schedule to the Constitution before the Judgment in the case of Kesavananda Bharati vs. State of Kerala, 1973 (4) SCC 225 that is 24.04.1973, would stand protected under Article 31B of the Constitution and, therefore, the challenge to the validity of provisions of the 1954 Act must fail.

The Provision in question

Section 50. General order of succession from males: – Subject to the provisions of Section 48 and 52, when a Bhumidhar or Asami being a male dies, his interest in his holding shall devolve in accordance with the order of the succession given below:

a) Male lineal descendants in the male line of the descent:

Provided that no member of this class shall inherit if any male descendant between him and the deceased is alive:

Provided further that the son or sons of a predeceased on how low so ever shall inherit the share which would have devolved upon the deceased if he had been then alive:

b) Widow; c) Father; d) Mother, being a widow; e) Step mother, being a widow; f) Father’s father; g) Father’s mother, being a widow; h) Widow of a male lineal descendant in the male line of descent; i) Brother, being the son of same father as the deceased; j) Unmarried sister; k) Brother’s son, the brother having been a son of the same father as the deceased; l) Father’s father’s son; m)Brother’s son’s son; n) Father’s father’s son’s son; and o) Daughter’s son.

Grounds of challenge

(i) violation of Article 14 of the Constitution;

(ii) women being discriminated despite world over the rights of women were being empowered;

(iii) Hindu Succession Act, 1956 would prevail over the 1954 Act.

Analysis

Repugnancy – Article 254 of the Constitution

It was argued before the Court that Succession provided in 1956 Act will prevail over the succession provided in 1954 Act in view of Article 254 of the Constitution, as there is clear repugnancy. The Court rejected this submission and held that the question of repugnancy arises only if both the Parliament and the State legislature have made law with respect to any one of the matters enumerated in the Concurrent list (List III). However, in the present case two enactments of 1956 and 1954 are relatable to Entries in List III and List II respectively. Thus, no question of repugnancy would arise in view of Article 254 of the Constitution.

Special Law

The argument relating to 1956 Act being a special law and 1954 being a general law is completely misconceived as, it has been expressed by the Supreme Court as well as High Courts, on several occasions, that any State enactment relating to Agricultural land tenures is a special law.

Repeal of an enactment – Effect

The Court also rejected the contention that Section 4(2) of the 1956 Act having been deleted by an amendment in 2005, there would be no justification to apply the provisions of succession given in the 1954 Act as the same would now be governed by the 1956 Act as by virtue of Section 6 of the General Clauses Act, the repeal of an enactment would not affect the previous operation of such an enactment.

In the case at hand, the deletion of Section 4(2) took place w.e.f 09.09.2005. Therefore, the effect of the deletion can only be in respect of successions which opened on or after 09.09.2005. This is because under Section 6(b) and 6(c) of the General Clauses Act repeal cannot affect the previous operation of any enactment so repealed and cannot affect the previous operation of any enactment so repealed and cannot affect any right which may have been acquired or accrued.

In the present case, as the succession has opened prior to 09.09.2005, the rights of the descendants in terms of Section 50 became crystallized on account of the said Section read with Section 4(2) of the 1956 Act, therefore, the deletion of Section 4(2) cannot have retrospective effect.

Also, the 1954 Act is a special law, dealing with fragmentation, ceiling, and devolution of tenancy rights over agricultural holdings only, whereas the 1956 Act is a general law, providing for succession to a Hindu by religion as stated in Section 2 thereof. The existence or absence of Section 4(2) in the 1956 Act would be immaterial.

Gender Bias

While it was argued before the Court that the provisions of Section 50(a) of the 1954 Act are violative of Articles 14 and 15 of the Constitution of India as there is clear discrimination on the ground of sex, the Court held that the argument was invalidated once it was held that there can be no challenge to the 1954 Act as the said legislation is included in the Ninth Schedule of the Constitution of India.

[Har Naraini Devi v. Union of India, CIVIL APPEAL NO. 22957 OF 2017, decided on 20.09.2022]


*Judgment by: Justice Vikram Nath

Case BriefsSupreme Court

Supreme Court: In a case relating to the appointment of the Vice-chancellor of the Sardar Patel University where the search committee had gone against the eligibility criteria prescribed by the UGC Regulations, the bench of MR Shah* and BV Nagarathna, JJ has held that the eligibility criteria when once fixed by the UGC under its regulations would apply to all the universities which are aided by the UGC to be bound by the said regulations even in the absence of the same being incorporated under the respective universities Act of the respective States.

Factual Background

Regulation 7.3.0 of UGC Regulations on Minimum Qualifications for Appointment of Teachers and Other Academic Staff in Universities and Colleges and Measures for the Maintenance of Standards in Higher Education, 2010 prescribes that a person shall have ten years of teaching work experience as a professor in the University system. It also provides for constitution of a Search Committee consisting of a nominee of the Visitor/Chancellor, a nominee of the Chairman of UGC, a nominee of Syndicate/Executive Council of the University. The Search Committee has to recommend the names of suitable candidates for appointment as Vice Chancellor of a University

The petitioner argued before the Court that ignoring Regulation 7.3.0 of the UGC Regulations, a   Search Committee was constituted under Section 10(2)(b) of the Sardar Patel University Act, 1955 (SPU Act) with no nominee of the Chairman of the UGC. According to the petitioner, even as per Section 10(2)(b), the Search Committee has only the authority to recommend a panel of suitable candidates. The Search Committee, in the present case, exceeded its jurisdiction and prescribed its own eligibility criteria for the   post of Vice Chancellor by diluting the eligibility criteria laid down in the UGC Regulations, 2010.

Analysis

The UGC Regulations are enacted by the UGC in exercise of powers under Section 26(1)(e) and 26(1)(g) of the UGC Act, 1956. Even as per the UGC Act every rule and regulation made under the said Act, shall be laid before each House of the Parliament. Therefore, being a subordinate legislation, UGC Regulations becomes part of the Act. In case of any conflict between State legislation and Central legislation, Central legislation shall prevail by applying the rule/principle of repugnancy as enunciated   in Article 254 of the Constitution as the subject ‘education’ is in the Concurrent List (List III) of the Seventh Schedule of the Constitution.

Further, the eligibility criteria when once fixed by the UGC under its regulations would apply to all the universities which are aided by the UGC to be bound by the said regulations even in the absence of the same being incorporated under the respective universities Act of the respective States.

The Court noticed that the State of Gujarat did not take note of the communication from the UGC and instead the University left to the sweet will of the search committee to prescribe eligibility criteria for the appointment of the Vice-Chancellor of the University.

In such circumstances, the Court observed,

“… prescribing the eligibility criteria shall not be left to the sweet will of the search committee. It may lead to arbitrariness and different search committees in absence of any statutory guidelines and/or   prescription, may prescribe different eligibility criteria.”

[Gambhirdhan K. Gadhvi v. State of Gujarat, 2022 SCC OnLine SC 256, decided on 03.03.2022]


*Judgment by: Justice MR Shah


Counsels

For petitioner: Senior Advocate IH Syed

For UGC: Advocate Manoj Ranjan Sinha

For University: Senior Advocate Vinay Navare

For Vice-Chancellor appointee: Advocate Gaurav Agrawal

For State: Advocate Ruchi Kohli

Case BriefsHigh Courts

Bombay High Court, Bench at Aurangabad: Vibha Kankanwadi, J., while addressing a matter revolving around the property, observed that,

Article 254 of the Constitution gets attracted only when both Central and State legislations have been enacted on any of the matters in the said List and there is conflict between two legislations.  

The basic principle is that the Central legislation will prevail as Article 254(1) of the Constitution gives supremacy to the law made by the Parliament.

Factual Background

The instant matter pertained to partition and separate possession.

Appellant submitted that the Courts below did not consider the evidence and the law points properly and the relationship between the parties was not denied.

Plaintiff and the defendant 3 were sisters and defendant 1 was their brother, inter se. Original defendant 2 was their mother and father expired on 14-12-1998 who had left behind the suit property.

There was no actual partition of the property because no share was given to defendant 2. The said property was divided into plots and, therefore, its price went up.

The plaintiff had contended that defendants 1 to 3 intended to oust the plaintiff from inheritance and, therefore, she demanded her share from the suit property, however, it was refused and, therefore, she had filed the suit. Later defendant 2 also expired.

Further, it was denied that the plaintiff and defendants were members of the joint family.

Two hectares and 42 R land was given to defendant No.1 and rest of the property was kept by Jyotiram in the name of himself and defendant No.2 in the year 1982.

Appellants advocate contended that the Courts below wrongly held that the suit property was ancestral and joint Hindu Family property of the plaintiff and the defendants.  Both the Courts below did not properly consider the law point involved in the case and went on to observe that the case was governed by amended Section 6 of the Hindu Succession Act (as amended in 2005).

It was further submitted that the plaintiff got married in the year 1966 and defendant 3 got married in 1965. Therefore, even now, those daughters cannot get the benefit of the amendment to the Hindu Succession Act.

Section 29-A of the Hindu Succession Act, which was Maharashtra Amendment, made a specific provision and gave right to unmarried daughter/s after the said Act came into force w.e.f. 22nd June, 1994. Though now all the daughters have been made co-parceners; yet we are required to see that Section 29-A of the Hindu Succession Act, i.e. Maharashtra Amendment, had received assent of Hon’ble President of India.

 Legal Position

A very significant point to be noted was that in the present situation, after Section 6 of the Hindu Succession Act, 1956 was amended in 2005; yet the Centre did not notify or declare that Section 29-A of The Maharashtra Amendment to Hindu Succession Act, as repealed and, therefore, the daughters, who were married prior to 1994, would not get any share in the property left by their father.

In view of the above-stated position, substantial questions of law arose in the present matter, requiring admission of the Second Appeal.

Partition

High Court expressed that both the Courts below, properly appreciated the evidence and concluded that the defendant failed to prove the previous partition allegedly effected in the year 1982.

Main Contention

Section 29-A of the Hindu Succession Act is still in operation and, therefore, the married daughters, i.e. those daughter, who were married prior to 1994, will not get any share either in the ancestral or joint family property.

High Court stated that a limited right was given to the daughter earlier, and therefore, in order to widen the scope and the rights along with and after certain States made amendment; Maharashtra State amended the law and gave right to the daughter equivalent to sons by making her co-parcener. However, it was limited to those daughters, who were unmarried at the time of coming into force of the said provision.

Law on Succession

Court expressed that the law on the point of Succession is at Entry No.5 of the Concurrent List, i.e., List No. III in the Seventh Schedule. Article 254 of the Constitution gets attracted only when both Central and State legislations have been enacted on any of the matters in the said List and there is conflict between two legislations.

Further, it was added by the Bench that in the year 2005, the Union Government brought an amendment to Section 6 of the Hindu Succession Act and made the daughters as coparceners and was done with a view to give equal rights to the daughters in comparison to sons. When the Maharashtra State Amendment was restricted to un-married daughters (excluding the daughters, who were married prior to 1994), no such distinction has been made in Section 6 of the amended provision by the Union Government and, therefore, the repugnancy existed.

Taking into consideration both the enactments, i.e., Section 29-A and Section 6, as amended in 2005, they cannot stand together and, therefore, the law made by the Parliament would prevail over the State Law in view of Article 254(1) of the Constitution of India. 

Central enactment, i.e., Section 6 Hindu Succession (Amendment) Act, 2005 would be applicable to this case and in view thereof, the plaintiff has share in the suit property, which has been rightly adjudicated by both the Courts below.

In Court’s opinion, no substantial question of law as contemplated under Section 100 CPC arose in the present matter, which required the admission of the Second appeal.

Therefore, in view of the decision of Kirpa Ram (deceased) v. Surendra Deo Gaur, [2021 (3) Mh. L.J. 250], the second appeal deserved to be dismissed at the threshold. It deserved to be dismissed.

Civil Application No. 8434 of 2019 was moved by the applicant. The applicant was the wife of original defendant 1 and mother of original defendants 4 and 5. She came with a case that during lifetime of original defendant 2, i.e. her mother-in-law, had executed a will in favour of the applicant and therefore she became owner of other half share of the property and further tried to produce the will.

It was noted that the matter was before the trial court for about 8 years and no attempt was made by defendants to disclose it to the Court that any such will was left by defendant 2.

Court expressed that,

Though the husband and sons had every knowledge about the suit, it is hard to believe that the applicant, who is residing with them, had no knowledge about the suit that was filed; the decree that was passed and the appeal was filed by the husband. There was no attempt on the part of the applicant to contest or get herself added as respondent.

Concluding the matter, Court held that for about four (4) years, nine (9) months and Twenty-six (26) days, the matter was before the first Appellate Court, yet once again no attempt was made by the present applicant to get herself added as party to the proceeding or challenge the decree passed by the Trial Court independently in her own capacity. In view of this, the present application does not deserve to be allowed.[Babu v. Muktabai, Second Appeal No. 402 of 2019, decided on 1-12-2021]


Advocates before the Court:

Mr Mukul S.Kulkarni, Advocate h/for Mr Kiran T.Jamdar, Advocate for Appellants;

Mr GR Syed, Advocate for Respondent No.1;

Mr VD Godbharale, Advocate for Intervenor

Op EdsOP. ED.

“Courts of equity make a distinction in all cases between that which is matter of substance and that which is matter of form; and if it finds that by insisting on the form, the substance will be defeated, it holds it to be inequitable to allow a person to insist on such form, and thereby defeat the substance.”

 — [Lord Romilly MR in Parkin v. Thorold[1]]

Whilst the captioned quote is a well-known maxim under the personal law of equity, the same principle was upheld by the Supreme Court in the context of the plenary powers of a State Legislature to retrospectively validate laws for repugnancy under Article 254(2)[2] of the Constitution.

In its judgment in G. Mohan Rao v. State of T.N.[3], the 2-Judge Bench of the Supreme Court comprising of Khanwilkar and Dinesh Maheshwari, JJ. clarified the law relating to retrospective validation of laws that have been judicially pronounced to be invalid for repugnancy.

This case concerned issues of repugnancy arising between the “Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013” (the 2013 Act)[4] on the one hand, and three Tamil Nadu land acquisition statutes,  (i) the Tamil Nadu Acquisition of Land for Harijan Welfare Schemes Act,1978 (Act of 1978)[5], (ii) the Tamil Nadu Acquisition of Land for Industrial Purposes Act, 1997 (Act of 1997), and (iii) the Tamil Nadu Highways Act, 2001 (Act of 2001)[6], on the other.

After the 2013 Act came into force, the State of Tamil Nadu wished to preserve its own State laws which allowed for more speedy acquisition proceedings and so sought to exclude them from the applicability of the Central law whilst maintaining the main reforms introduced by the Central law, namely, on enhanced compensation and resettlement and rehabilitation. It is noteworthy that several Central laws are excluded from the scope of the 2013 Act by being placed under Schedule 4[7] to the said Act. This Schedule includes the National Highways Act, 1956[8], which is pari materia with the 2001 Tamil Nadu statute on highways acquisitions.

To this end, in 2014, the State Legislature enacted a law inserting Section 105-A[9] into the 2013 Act insofar as it applies to the State of Tamil Nadu to continue acquiring lands under the three State laws by excluding the applicability of the 2013 Act. However, at the same time, maintaining the provisions on compensation and rehabilitation and resettlement under the 2013 Act. Presidential assent was obtained for Section 105-A under Article 254(2) of the Constitution.

This was challenged before the High Court of Madras. The High Court in its judgment dated 3-7-2019[10] struck down and declared all three State laws to be void for repugnancy and set aside all land acquisitions thereunder post coming into effect of the 2013 Act. The High Court held that the law enacting Section 105-A, which sought to revive the three State laws, was ineffective. It found that as the State laws had become void on the date the 2013 Act received Presidential assent (i.e. on 27-9-2013) they could not be “resuscitated” but had to be re-enacted as new individual Bills. The State appealed this judgment before the Supreme Court in a special leave petition which remains pending.

Meanwhile, given the dire effects of the judgment of the High Court on pending land acquisition proceedings and consequently on its exchequer, the State Legislature introduced and enacted “A Bill to revive the operation of the Tamil Nadu Acquisition for Harijan Welfare Schemes Act, 1978, the Tamil Nadu Acquisition of Land for Industrial Purposes Act, 1997 and the Tamil Nadu Highways Act, 2001” (the 2019 Act). The said Bill received Presidential assent under Article 254(2) on 2-12-2019. The Tamil Nadu Land Acquisition Laws (Revival of Operation, Amendment and Validation) Act, 2019 was challenged in writ proceedings before the Supreme Court by G. Mohan Rao and others (being owners of agricultural and wetlands sought to be acquired for highways development) on the grounds, inter alia, that the 2019 Act amounts to subversion of the judgment of the High Court.

In its judgment penned by A.M. Khanwilkar, J. the Supreme Court dismissed the writ petition, held that retrospective validation of laws where repugnancy arises between State and Central subjects on the Concurrent List is a common phenomenon and that in judging the constitutionality of these validating laws, courts ought not to place form over substance.

Article 254(2) of the Constitution states that wherever a State law is repugnant with an earlier Central law regarding one of the matters enumerated in the Concurrent List then the State law may nevertheless prevail in the State if it has received Presidential assent. Thus, Article 254(2) is a means to cure any repugnancy that may otherwise render the State law unconstitutional. The provision is as follows:

(2) Where a law made by the legislature of a State with respect to one of the matters enumerated in the Concurrent List contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State:

The proviso to Article 254(2) clarifies that the above power is subject to the overriding power of Parliament to enact a law amending or repealing the State law that has received Presidential assent under this provision.

In G. Mohan Rao[11], A.M. Khanwilkar, J. correctly limited himself to the issue of repugnancy and not the vires of the 2019 Act vis-à-vis Part III of the Constitution and held that the High Court applied the law under Article 254(2) in an erroneous manner to the facts of the case. In particular, the High Court erred in insisting that all three State laws be re-enacted afresh. According to the Supreme Court, the High Court had placed a hypertechnical divide between re-enactment and revival or validation.

Validating statute need not be a re-enactment of the older repugnant law

 In its findings, the Supreme Court reiterated the well-established legal position that the State Legislature can retrospectively validate laws in response to judicial invalidation of such laws. Running through past authorities such as National Agricultural Coop. Mktg. Federation of India Ltd. v. Union of India[12], Ujagar Prints (2) v. Union of India[13] and Indian Aluminium Co. v. State of Kerala[14] , the Supreme Court held that there is a consensus that legislative validation of laws does not amount to judicial subversion if the following conditions are met:

(i) The legislature must be having power over the subject-matter as also competence to make a validating law.

(ii) There must be an explicit validating clause coupled with a substantive change in the earlier position.

(iii) The retrospective operation must be specified clearly.

(iv) There can be no express or declaratory overruling of the judgment of the Court.

The Supreme Court found that all four requirements were met by the 2019 Act. It held that the 2019 Act had a clear determinative principle demonstrated by:

(a) its Statement of Objects and Reasons which specifically stated that it was for the revival of the  State Acts concerned declared to be repugnant by the High Court and to amend the same and for validating the actions already taken thereunder;

(b) that the Act is divided into three parts and each part is dedicated explicitly to the State enactment concerned; and

(c) that it expressly revived the three State acts with effect from 26-9-2013 (one day before the Presidential assent was given to the 2013 Act) along with all orders, notifications, etc. and saved all land acquisitions thereunder.

 A.M. Khanwilkar, J. whilst noting that the State Legislature neither individually placed the State laws in the form of new Bills before the House and nor did it separately amend the three State Acts, held that the 2019 Act was nevertheless a practical piece of validating law and did not subvert the High Court’s judgment for the reasons mentioned above.

Furthermore, referring to the doctrine of referential legislation (wherein a law is incorporated into and forms part of another through express reference), and relying on its judgment in Ujagar Prints (2)[15] where it was held that legislation by reference is practically tantamount to re-enactment — the Supreme Court held that the 2019 Act effectively incorporated the three State laws by reference and that no re-enactment was required.

The Supreme Court put an end to needless confusion caused by the judgment of a 3-Judge Bench of the Delhi High Court in P.L. Mehra. v. D.R. Khanna[16], which held that revalidation would not be permissible as a constitutionally invalid statute was a dead letter and could therefore technically not be “revived” but had to be re-enacted in the strict sense of that term. The Supreme Court found that P.L. Mehra[17] was concerned with nullity under Article 13[18] of the Constitution  (i.e. voidness due to violation of any of the provisions of Part III of the Constitution) and not with repugnancy. Ergo, repugnancy can be cured through a validating amendment or a truncated statute such as the 2019 Act and did not have to be re-enacted.

Sufficiency of Presidential assent under Article 254(2)

 The Supreme Court also correctly emphasised substance over form when examining the nature of the Presidential assent given to the 2019 Act under Article 254(2) of the Constitution. According to A.M. Khanwilkar, J. determinative in this respect is the transparency of communication between State and Centre when seeking Presidential assent. In the present case, in its letter seeking Presidential assent, the State had briefly narrated the entire factual position including about the failed attempt to revive the State enactments via Section 105-A and expressly outlined that repugnancies may exist between the 2013 Act and the 2019 Act. The Supreme Court reiterated the law set out in its earlier judgment in Kaiser-I-Hind (P) Ltd. v. National Textile Corpn. (Maharashtra North) Ltd.[19]  in which it upheld the legal proposition that the President’s assent is not justiciable but at the same time Article 254(2) cannot be abused to obtain a general assent. Relying on this dictum, the Supreme Court in effect held that it would not go behind or do hair-splitting at what weighed in the President’s mind when he/she assented to the Bill. So long as the specific State Bill is with the President, the specific Central Act identified and attention invited to the apprehended repugnancy.

One further finding of the Supreme Court related to the objection raised by the writ petitioner that the deemed date of commencement of the 2019 Act (being 26-9-2013) was fatal to the 2019 Act. They argued that on 26-9-2013 there was no 2013 Act in operation (which became operational only from 27-9-2013) and when the 2013 Act came into operation the next day, the State enactments would again become repugnant.  A.M. Khanwilkar, J. rejected this circuitous argument and held that there is a difference between a law being “made” and its commencement. It was held that making of a law involves a demarcated legislative procedure which culminates with the assent of the President or Governor. Applying the law set out in State of Kerala v. Mar Appraem Kuri Co. Ltd.[20], the Supreme Court found that repugnancy occurs at the point in time the law is made. The 2019 Act was therefore “made” when it received Presidential assent on 2-12-2019. The fact that it was given retrospective effect from 26-9-2013 was done in abundant caution to save past land acquisitions under the three State laws and not to compete with the laws existing in the past at that point of time (i.e. the Land Acquisition Act, 1894[21]). Thus, the Supreme Court found for the State of Tamil Nadu on all counts.

The Court’s emphasis on substance over form is evident from the following excerpt in G. Mohan Rao[22]:

 “61. … To say that a particular form of legislative activity is not permissible would require a strong basis in the Constitution, which has not been pointed out by the petitioners. The Constitution envisages a judicial review of the existence of legislative competence and use of such competence to enact something that does not violate Part III or other provisions of the Constitution. It does not envisage a review of the cosmetic characteristics of a legislation as long as the substance of such legislation has its roots in the Constitution.”

 The judgment of the Supreme Court is therefore legally correct and sound as it delineates the powers of the Court when it comes to adjudicating the constitutionality of validating laws under Article 254(2) and recognises the wide plenary powers of the State Legislature in legislating on matters in the Concurrent List. In the process, the judgment stresses that unduly formalistic fetters cannot be placed on the vast plenary powers of the State Legislature.

 A.M. Khanwilkar, J. was not convinced by the technical objections taken by the writ petitioners and rightly so. The Supreme Court recognised that, in effect, all that is practically required for validating laws where repugnancy arises is explicit statutory wording. This is of course subject to the validating law passing the test of constitutionality under Part III but, as noted above, this was not an issue before the Court in G. Mohan Rao[23].


 †† Advocate-on-Record, Supreme Court of India.

† Advocate, Supreme Court of India.

[1]   (1852) 16 Beav 59.

[2] Article 254(2)  of the Constitution.

[3] 2021 SCC OnLine SC 440.

[4] <http://www.scconline.com/DocumentLink/Y53nZ49Z>.

[5] <http://www.scconline.com/DocumentLink/wze2D86P>.

[6] <http://www.scconline.com/DocumentLink/i9oMrdWU>.

[7]  <http://www.scconline.com/DocumentLink/k4TW71zs>.

[8] http://www.scconline.com/DocumentLink/Ehv7iE72>.

[9] <http://www.scconline.com/DocumentLink/Q9Z2Fpuh>.

[10] Caritas India v. Union of India, 2019 SCC OnLine Mad 2167.

[11] 2021 SCC OnLine SC 440.

[12] (2003) 5 SCC 23.

[13] (1989) 3 SCC 488.

[14] (1996) 7 SCC 637.

[15] (1989) 3 SCC 488.

[16] 1970 SCC OnLine Del 203.

[17] 1970 SCC OnLine Del 203.

[18] Article 13 of the Constitution.

[19] (2002) 8 SCC 182.

[20] (2012) 7 SCC 106.

[21] Land Acquisition Act, 1894.

[22] 2021 SCC OnLine SC 440.

[23] 2021 SCC OnLine SC 440.

Case BriefsSupreme Court

Supreme Court: Dealing with the question relating to applicability of the Maharashtra Relief Undertakings (Special Provisions Act), 1958 vis-a-vis the Insolvency and Bankruptcy Code of 2016, the bench of RF Nariman and SK Kaul, JJ held that the State law is repugnant to the Parliamentary enactment as under the said State law, the moratorium imposed under Section 4 of the Maharashtra Act directly clashes with the moratorium to be issued under Sections 13 and 14 of the Code.

Explaining the scheme of both the Laws, the Court said that the moment initiation of the corporate insolvency resolution process takes place, a moratorium is announced by the adjudicating authority vide Sections 13 and 14 of the Code, by which institution of suits and pending proceedings etc. cannot be proceeded with. This continues until the approval of a resolution plan under Section 31 of the said Code. In the interim, an interim resolution professional is appointed under Section 16 to manage the affairs of corporate debtors under Section 17 of the Code.

It was further explained that whereas the moratorium imposed under the Maharashtra Act is discretionary and may relate to one or more of the matters contained in Section 4(1), the moratorium imposed under the Code relates to all matters listed in Section 14 and follows as a matter of course. Hence, unless the Maharashtra Act is out of the way, the Parliamentary enactment will be hindered and obstructed in such a manner that it will not be possible to go ahead with the insolvency resolution process outlined in the Code. Further, the non-obstante clause contained in Section 4 of the Maharashtra Act cannot possibly be held to apply to the Central enactment, inasmuch as a matter of constitutional law, the later Central enactment being repugnant to the earlier State enactment by virtue of Article 254 (1), would operate to render the Maharashtra Act void vis-à-vis action taken under the later Central enactment

It was, hence, held that by giving effect to the State law, the aforesaid plan or scheme which may be adopted under the Parliamentary statute will directly be hindered and/or obstructed to that extent in that the management of the relief undertaking, which, if taken over by the State Government, would directly impede or come in the way of the taking over of the management of the corporate body by the interim resolution professional. Hence, the Code would prevail against the Maharashtra Act in view of the non-obstante clause in Section 238 of the Code. [Innoventive Industries Ltd. v. ICICI Bank, 2017 SCC OnLine SC 1025, decided on 31.08.2017]

Case BriefsSupreme Court

Supreme Court: Dealing with the matter where it was contended that a Sale Notification issued under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) was in infraction of Section 187 of the Tripura Land Revenue and Land Reforms Act, 1960, the Court held that the dominant legislation being the Parliamentary legislation, the provisions of the Tripura Act of 1960 would be invalid. It is the provisions of the Act of 2002, which do not contain any embargo on the category of persons to whom mortgaged property can be sold by the bank for realisation of its dues that will prevail over the provisions contained in Section 187 of the Tripura Act of 1960.

Applying the test of ‘dominant legislation’ on the encroachment in the present case, the Court, explaining the difference between the Central and State Law, said that the provisions of the Act of 2002 enable the bank to take possession of any property where a security interest has been created in its favour, specifically, Section 13 of the 2002 Act enables the bank to take possession of and sell such property to any person to realise its dues. The purchaser of such property acquires a clear title to the property sold, subject to compliance with the requirements prescribed. Section 187 of the Tripura Act of 1960, on the other hand, prohibits the bank from transferring the property which has been mortgaged by a member of a scheduled tribe to any person other than a member of a scheduled tribe.

The bench of Ranjan Gogoi and Abhay Manohar Sapre, JJ, hence, said that sale of mortgaged property by a bank is an inseparable and integral part of the business of banking. So long there did not exist any parallel Central Act dealing with sale of secured assets and referable to Entry 45 of List I, the State Act, including Section 187, operated validly. However, the moment Parliament stepped in by enacting such a law traceable to Entry 45 and dealing exclusively with activities relating to sale of secured assets, the State law, to the extent that it is inconsistent with the Act of 2002, must give way. [UCO Bank v. Dipak Debbarma, 2016 SCC OnLine SC 1391, decided on 25.11.2016]