Unit II 12-14.pptx

In this part, unless the context otherwise requires, the
State includes the
⚫Government and Parliament of India and
⚫the Government and the Legislature of each of the
States and
⚫all local authorities and
⚫ other authorities within the territory of India or
under the control of the Government of India
State – Article 12

⚫The rights provided in Part III of the Constitution are
guaranteed against the state and are distinguished
from violation of rights by privates. Private actions are
protected by separate laws and writ cannot be filed
for violation of FR by private action.

⚫ Unit of local self government like Municipal Committee or village Panchayat.
⚫ Union of India v. R.C. Jain 1981
⚫ Whether DDA (Delhi Development Authority) is local authority or not?
⚫ Court referred to Section 3(31) of the General Clauses Act, which states that
local authority shall mean a municipal committee, district board, body of port
commissioners or other authority legally entitled to , or entrusted by te
Government with , the control or management of a municipal or local fund”
⚫ SC held that to be characteristic as “local authority” the authority
⚫ - must have separate legal existence as a corporate body, must not be mere
government agency but legally independent .
⚫ - function in a defined area and must normally be directly or indirectly elected
y people of that area.
⚫ - degree of autonomy entrusted by a statute.
⚫ - have the power to raise funds through tax, charges etc.
⚫ Hence DDA was held as a Local Authority.
Local Authorities

⚫Calcutta State Transport Corporation v.
Commissioners of Income Tax, West Bengal 1996
⚫Sc refused to consider the state transport corporation
as local authority
⚫There is no element of popular representation in its
constitution.
⚫In nature of trading corporation.

⚫‘Other Authorities’ have been a matter of numerous
litigation before the Supreme Court
⚫The function of government in welfare state is quite
wide.
⚫Whether ‘autonomous bodies’ statutory or not are
covered within Art 12?
⚫Concept of ‘instrumentality’ of state’.
Other Authorities

⚫The Supreme Court held that the expression “other
authorities” is wide enough to include all authorities
created by the Constitution or statute on whom the
powers are conferred by Law. It is not necessary that
the statutory authority should be engaged in
performing governmental or sovereign function.
Electricity Board, Rajasthan v. Mohan
Lal

⚫ the Supreme Court following the test laid down in Electricity
Board Rajasthan’s case by 4:1 majority held that ONGC, LIC, IFC
within the meaning of Article 12 of the Constitution and
therefore they are ‘State’.
⚫ All three statutory corporations have the power to make
regulations under the statute for regulating conditions of
service of their employees.
⚫ The rules and regulations framed by the above bodies have the
force of law. The terms of contract with a particular employer is
prescribed by the statute itself. These regulations are binding on
these bodies. The employees of these statutory bodies have a
statutory status and they are entitled to declaration of being in
employment when their dismissal or removal is in
contravention of statutory provisions. The employees are
entitled to claim under Articles 14 and 16 against the
corporation.
Sukhdev v/s Bhagatram 1975

⚫it held pointed out that the corporations acting as
instrumentality or agency of government would
obviously be subject to the same limitations in the
field of constitutional or administrative law as the
government itself, though in the eyes of law they
would be distinct and independent legal entities. Held
that if a body is an agency or instrumentality of the
government it may be an authority in art 12.
⚫Laid down 5 point test.
R.D. Shetty v International Airport
Authority of India 1979

⚫ It has been held that a Society registered under the
Societies Registration Act, 1898, is an agency or
“instrumentality of the State” and hence a “State” within
the ambit of Article 12. Its composition is determined by
the representatives of the Government. The expenses of
society are entirely provided by the Central Government.
The rules made by the society require prior approval of the
State and is completely controlled by the Government.
The government has the power to appoint and remove the
members of the society. Thus, the State and the Central
Government have full control of the working of the
society. In view of these elements the society is an
instrumentality of the State or the Central Government
and it is therefore an “authority” within the meaning of
Article 12.
Ajay Hasia v. Khalid Mujib 1980

⚫ In the instant case, the key factor was “the brooding
presence of the state behind the operations of the body,
statutory or other”.
⚫ In this case, the body was semi-statutory and semi-non-
statutory. It was non-statutory in origin; it was also
recognized by the Act in question and thus had some
“statutory flavour” in its operations and functions. In this
case, there was a formal transfer of the undertaking from
the Government to a government company. Other
Authorities the corporation was writ large in the Act and
in the factum of being a government company. Agency of
a state would mean a body which exercises public
functions.
SomPrakash v. Union of India
1980

⚫When the body is financially, functionally and
administratively dominated by or under the control of
the government and such control is particular to the
body and is pervasive, then it will be “State” within
Article 12. If the control is merely regulatory, it will
not be a State.
Pradeep Kumar Biswas v. Indian
Institute of Chemical Biology, (2002) 5
SCC 111.

⚫The Supreme Court by a majority judgement held that
the Board of Control for Cricket in India (BCCI) is not
a ‘State’ or ‘authority’. It was held that merely because
a non-governmental body exercises some public duty,
that by itself would not suffice to make such body a
State for the purpose of Article 12.
Zee Telefilms Ltd. & Anr vs Union
Of India & Ors 2005

⚫Thereby a court may be sued for a violation of the
fundamental right to the extent only till it is
performing its administrative function. The point it
began it judicial function it does not violate any
fundamental right and cannot be taken as “State”.
⚫Naresh v. State of Maharashtra 1966 which
observed that "while exercising the rule making
powers the judiciary is covered by the expression state
with Art.12 but while performing its judicial functions
it is not so included."
Judiciary- A State

⚫it has been observed that when rule making power of
Judiciary is concerned it is State but when exercise of
judicial power is concerned it is not State.
A.R. Antulay v. R.S. Nayak 1988

⚫Article 13 envisages supremacy of the Constitution.
⚫According to Article 13 of the constitution “Law
inconsistent with or in derogation of the fundamental rights
are void”.
⚫Article specifying “Judicial Review”
Article 13

Article 13
“13. Laws inconsistent with or derogation of
the fundamental rights:
1. All laws in force in the territory of India
immediately before the commencement of
this constitution, in so far as they are
inconsistent with the provisions of this
part, shall, to the extent of such
inconsistency, be void.
2. The state shall not make any law which
takes away or abridges the rights conferred
by this part and any law made in
contravention of this clause, shall, to the
extent of such contravention, be void.

3. In this Article, unless the context otherwise
requires,-
a) “law” includes any Ordinance, order,
bye-law, rule, regulation, notification,
custom or usage having in the Territory of
India the force of law;
b) “laws in force” includes laws passed or
made by Legislature or other competent
authority in the territory of India before
the commencement of this constitution
and not previously replaced,
notwithstanding that any such law or any
part thereof may not be then in operation
either at all or in particular areas.
4. Nothing in this Article shall apply to any

Pre Constitutional Laws
Article 13(1) declares that all laws in force in
the territory of India immediately before
the commencement of the Indian
Constitution shall be void to the extent to
which they are inconsistent with
fundamental rights under Part III of the
Constitution.

Post Constitutional Laws
⚫Article 13(2) prohibits state to make any law,
which takes away or abridges rights conferred
by part III of the constitution.
⚫If state makes such a law, it becomes ultra vires
and void to the extent of the contravention.

Law and Laws in force
⚫According to article 13(1)(a) the term law includes
‘any ordinance, order, bye-law, rule, regulation,
notification, custom or usage having the force of
Law.
⚫However, it was held that personal law such as
Hindu Law or Muslim law are not covered by the
term ‘law’ under Article 13

⚫The expression ‘laws in force’ under article
13(3)(b) includes ‘laws passed or made by a
legislature or other competent authority in the
territory of India before the commencement of
the constitution not previously repealed.
⚫It includes customs and usages and also the
laws passed by the British Parliament and
applicable to India like the Fugitive Offenders’
Act 1881.

In view of the provisions enshrined in Article 13 of
the constitution the following doctrines have
been formulated:
1. No retrospective effect
2. Doctrine of Severability
3. Doctrine of Eclipse
4. Doctrine of Waiver

⚫ Keshavan Madhava Menon v. State of Bombay
the applicant who was the secretary of the people’s
publishing house Ltd., a company registered at Bombay
published a pamphlet inn 1949 titled as “ railway
mazdooron ke khilaf nai sazish”. For this, a prosecution
under the press (emergency powers) act, 1931 was started
against him.
During the pendency of the proceedings the constitution
of the India came into force. But the Supreme Court held
that Article 13(1) could not apply to this case as the offence
was committed before the commencement of the Indian
constitution and thus, the proceeding against the
petitioner are not affected.
No retrospective effect

Doctrine of Severability
⚫Meaning “ separation”.
⚫Purpose of Article 13 of the Indian
Constitution, it means “to separate the valid
portion of the law from the invalid
provisions”.
⚫The main object of the doctrine is to retain
the act or legislation in force by discarding/
deleting the void provisions.

⚫Article 13(1) of the constitution declares that
“all laws in force in the territory of India,
immediately before the commencement of
this constitution, which are inconsistent with
the fundamental rights under Part-III, shall
be void to the extent of such inconsistency”.
⚫The part of the statute inconsistent with Part-
III alone shall be declared void.

A.K.Gopalan v. State of Madras.
AIR 1950 SC 27-1950 SCJ 174
The supreme court struck down Sec.14 of the
Preventive Detection Act 1950 on the ground
that it is violative of the fundamental rights
guaranteed under article 22 of the
constitution.
The court separated that section from the
impugned act and held the remaining part of
the impugned act remains unaffected.

State of Bombay v. F.N. Balsara AIR
1951 SC 318
The supreme court held that though section 8 of the
bombay prohibition act 1949 were ultra vires for
infringement of the fundamental rights, the rest of the
act would continue.

Minerva Mills Ltd v. Union of India
AIR 1980 SC 1789
The supreme court struck down sections 4 and 55 of
the constitution (42nd Amendment) act 1976 as ultra
vires i.e beyond the amending power of the
parliament. These two sections were declared void
and severed from the act so as to make the
remaining part of the act constitutionally valid.

Doctrine of Eclipse
⚫“to hide wholly or in part” or “throwing into
the shade”
⚫Aims to validate a statute, which remains
dormant as it over-shadowed by the rights.
⚫Based on the principle that a law, which
violates fundamental right is not nullity or
void ab intio but becomes only
unenforceable.
⚫Such law shall be wiped out totally from the
statute book.

⚫According to article 13 (1) of the Indian Constitution,
“all laws in force of territory of India, immediately
before the commencement of the constitution, which
are inconsistent with the fundamental right under
part-III shall be void to the extent of such
inconsistency.
⚫The statute which id found inconsistency is declared
void. i.e. dormant not dead.
⚫The inconsistency of such statute can be removed
by an amendment to that effect so that the statute
becomes valid and enforceable.

Bhikaji Narain Dhakras v. state of
M.P
AIR 1955 SC 781
The Supreme Court upheld the constitutionality of the
impugned Act and enunciated the doctrine of the eclipse.
The court held that on the commencement of the
constitution, the impugned act became void to the extent it
was inconsistent with the right of citizens guaranteed by
article 19(1)(g) as it then stood. The true position was that
the impugned law, as it were, became eclipsed, for the
time being by the fundamental right.The supreme court
held that any existing law inconsistent with fundamental
right becomes inoperative from the date of Constitution is
not totally dead. It was dormant.

Doctrine of Waiver
The voluntary relinquishment or
abandonment of existing legal right or
privilege.

Basheshar Nath v. Commissioner of
Income Tax
AIR 1959 SC 149
Basheshar Nath, the petitioner in the instant
case was alleged, to have concealed huge
amount of income. The case was referred to
Income Tax Investigation Commissioner
under Section 5(1) of the taxation of Income
act 1947 and was found to be concealed the
income of rs.4,47,915/-
The petitioner accepted to pay rs.3,50,000/- by
the way of installments for rs.5000/- per
month and an agreement to that effect was
made in May 1954 under section 8A of the
act.

Whether an amendment of the
constitution amounts to ‘law’ under
article 13(2)

Shankari Prasad v. Union of India
AIR 1951 SC 458
The supreme court held that the word law in article 13(2)
did not include the law/ amendment made by the
Parliament under Article 368.
Sajjan Singh Vs. State of Rajasthan: The court expressed
their full concurrence with the decision in the earlier case.
The words "amendment of this constitution" in article 368
plainly and unambiguously meant amendment of all the
provisions of the Constitution; it would, therefore, be
unreasonable to hold that the word "law" in article 13(2)
took in Constitution Amendment Acts passed under article
368.

The above decision was ruled out by the supreme court in
Golaknath v. state of Punjab, AIR 1967 SC 1643, This time a
majority of six judges to five decided that Parliament had no
power to amend any of the provisions of Part III, so as to take
away or abridge the fundamental rights enshrined therein. It,
therefore, adopted a doctrine of prospective overruling under
which the three constitutional amendments concerned would
continue to be valid, and the decision to the effect that
Parliament had no power to amend the provisions of Part III
would operate for the future only.
Finally the supreme court in Kesavananda Bharati AIR 1973 SC
146 upheld the validity of the constitution act 1971 and over
ruled the decision of Golaknath’s case.

Provisions in Indian Constitution
⚫Article 14-Equality before Law
⚫Article 15- Prohibition of Discrimination on
grounds of religion, race, caste, sex or place of
birth
⚫Article 16-Equality of opportunity in matters
of public employment
⚫Article 17-Abolition of untouchability
⚫Article 18-Abolition of title
⚫THESE ARTICLES GUARANTEE THE RIGHT
TO EQUALITY.

Article 14 0f Indian Constitution
⚫The State shall not deny to any person equality
before the law and equal protection of the laws
within the territory of India.

⚫ Article 14 embodies the general principles of equality.
⚫ Article 14 bars discrimination & prohibits
discriminatory laws.
⚫ Article 14 outlaws (forbid) discrimination in a general
way & guarantees equality before law to all persons.
⚫ In view of certain amount of indefiniteness in article
14, separate provisions to cover specific
discriminatory situations have been made by
subsequent Articles.
⚫ Article 14 is the genus while Article 15 & 16 is the
species.
⚫ In situations not covered by Article 15 to 18, the
general principle of equality embodied in Article 14 is
attracted whenever discrimination is alleged.

Article 14 uses two expressions
⚫Equality before law
⚫Equal protection of laws

EQUALITY BEFORE THE LAW
⚫ Negative concept
⚫ It does not mean absolute equality among human beings which
is not possible.
⚫ It means:-
⚫ There is no special privilege in favour of any individual.
⚫ All are equally subject to the ordinary law of the land.
⚫ No person whatever is his rank or condition is above the land.
⚫ Equivalent to the second corollary of the Dicean concept of the
rule of law.
⚫ Prof Dicey’s three meanings of the Rule of Law:-
⚫ Absence of arbitrary power or supremacy of the law.
⚫ Equality before the law.
⚫ The constitution is the result of the ordinary law of the land.

Equality before Law –Not absolute rule-exceptions
⚫Article 361- Immunity to President and
Governor
⚫Special Privileges to Members of Parliament.
⚫Article 33 - Members of the Armed forces
Ambassadors, foreign diplomats enjoy
immunity from the country’s judicial process
⚫Public servants cannot be prosecuted for
certain offences without the sanction of the
appropriate authorities—Section 164 I.P.C
read with s 197 Cr.P.C.

EQUAL PROTECTION OF LAWS
⚫ Positive in content.
⚫ Based on the last clause of the first section of the
14th Amendment to the American Constitution.
⚫ Section 1 of 14th Amendment:-“No state shall deny to
any person within its jurisdiction the equal
protection of the law”

Equal Protection of Law does not mean that-
⚫Identically the same law should apply to all
persons.
⚫Every law must have a universal application
within the country irrespective of differences of
circumstances.
⚫It does not postulate equal treatment of all
persons without distinction.

Equal Protection of Law means
⚫Application of the same laws alike and without
discrimination to all persons similarly
situated.
⚫Equality of treatment in equal circumstances.
⚫Implies that among equals the law should be
equal and should be equally administered,
that the like should be treated alike, without
distinction of race, religion, wealth, social
status or political influence.

UNDERLYING PRINCIPLE:-
⚫Article 14 prescribes equality before the law.
⚫All persons are not equal by nature,
attainment or circumstances.
⚫Therefore a mechanical equality before the
law may result in injustice.
⚫The guarantee of equal protection of the law
does not mean that identically the same rules
of law should be made applicable to all
persons in spite of differences in
circumstances or conditions.

UNDERLYING PRINCIPLE:-
⚫The varying needs of different classes or
sections of people require different and
separate treatment.
⚫The legislature is required to deal with
diverse problems arising out of an infinite
variety of human relations.
⚫It must, therefore, necessarily have the power
of making laws to attain particular objects
and, for that purpose, of distinguishing,
selecting and classifying persons and things
upon which its laws are to operate.

Legislative Classification
⚫It is accepted that persons may be classified into
groups and such groups may be treated
differently if there is a reasonable basis for such
difference.

ARTICLE 14 FORBIDS CLASS LEGISLATION BUT IT DOES NOT
FORBID REASONABLE CLASSIFICATION
⚫ Class Legislation
⚫ Legislation which confers special privileges or
imposes special disabilities upon one class.
⚫ Class legislation is that
⚫ which makes an improper discrimination
⚫ by conferring particular privileges upon a class of
persons
⚫ arbitrarily selected from a large number of persons,
⚫ all of whom stand in the same relation
⚫ to the privilege granted and the persons not so favored
⚫ no reasonable distinction or substantial difference can
be found
⚫ justifying in the inclusion of one and the exclusion of
the other from such privilege.

ARTICLE 14 FORBIDS CLASS LEGISLATION BUT IT DOES
NOT FORBID REASONABLE CLASSIFICATION
⚫Reasonable Classification
⚫Classification must not be
⚫ arbitrary,
⚫ Artificial, or
⚫ evasive.
⚫Classification must always be based upon
some real and substantial distinction bearing a
just and reasonable relation to the object
sought to be achieved by the legislature.

TESTS FOR REASONABLE CLASSIFICATION
⚫ Classification to be reasonable should fulfill the
following two conditions:-
1. The classification must be founded on an intelligible
differentia which distinguishes persons or things that
are grouped together from others left out of the
group; and
2. The differentia must have a rational relation to the
object sought to be achieved by the Act.
⚫ The differentia which is the basis of the classification
and the object of the act are two distinct things.
⚫ What is necessary is that there must be a nexus
between the basis of classification and the object of the
Act which makes the classification.
⚫ It is only when there is no reasonable basis for a
classification that legislation making such
classification may be declared discriminatory.

State of West Bengal v. Anwar Ali AIR 1952 SC
75
⚫Facts
⚫The respondent and 49 other persons were
charged with various offences alleged to have
been committed by them in the course of their
raid as an armed gang on a certain factory
known as the Jessup factory at Dum Dum.
⚫Governor of West Bengal by a notification dated
26-1-1950 in exercise of the powers conferred by
S. 5(1) of the Act sent the cases for trial to the
Special Court.
⚫They were convicted and sentenced to varying
terms of imprisonment.

State of West Bengal v. Anwar Ali AIR 1952 SC 75
⚫ Respondent applied to the High Court under Art. 226 of
the Constitution for the issue of a writ of certiorari
quashing the conviction and sentence on the ground
that the Special Court had no jurisdiction to try the case
inasmuch as S. 5(1), under which it was sent to the Court
for trial was unconstitutional and void under Art. 13(2) as
it denied to the respondent the equal protection of the
laws enjoined by Art. 14.
⚫ The High Court by a Full Bench consisting of the Chief
Justice and four other Judges quashed the conviction
and directed the trial of the respondent and the other
accused persons according to law.
⚫ Hence the appeal.

State of West Bengal v. Anwar Ali AIR 1952 SC 75
⚫ Supreme Court held:-
⚫ S.5 (1) of the act contravened Article 14 and was void.
⚫ It conferred arbitrary power on the government to
classify offences or cases at its pleasure.
⚫ The Act did not lay down any policy or guidelines for
the exercise of discretion to classify cases or offences.
⚫ The procedure varied substantially from the procedure
laid down for the trial of offences generally by the
Cr.P.C.
⚫ The act did not lay down any basis for classification nor
did it mention clearly what kinds of cases were to be
directed for trial by the Special Courts.
⚫ It thus left it to the uncontrolled discretion of the State
Government to direct any type of cases which it liked to
the tried by the Special Court.

Kathi Ranning v. State of Saurashtra AIR 1952 SC 75
⚫ Facts:-
⚫ Appellant Kathi Raning Rawat, who has been convicted
under Ss. 302, 307 and 392 read with sec. 34 of the
Indian Penal Code and sentenced to death and of seven
years' R. I., the sentences to run concurrently.
⚫ The appellant was tried by a special Court constituted
under the Saurashtra State Public Safety Measures
(Third Amendment) Ordinance 1949 (Ord. No. 66 of
1949).
⚫ His conviction and sentences were upheld on appeal by
the State High Court.
⚫ He has preferred an appeal to this Court against the
decision of the High Court.
⚫ The act referred to four distinct categories of ‘offences’
or cases which could be directed by the Government to
be tried by the Special Courts established under
Ordinance.

Chiranjit Lal v. Union of India AIR 1961 SC 41
⚫Facts
⚫Due to mismanagement in Sholapur Spinning
and Weaving Company Limited, the
management threatened to close down the
mill.
⚫The Government of India passed the Sholapur
Spinning and Weaving Co. (Emergency
Provisions) Act
⚫The act empowers the Government to take over
the control and management of the company
and its properties by appointing their own
directors.
⚫The act was challenged by a shareholder of the

⚫A single company and its shareholder was being
denied equality before the law, because the Act
treated them differently vis-à-vis other companies
and their shareholders.
⚫Law had selected one particular company and its
shareholders and had taken away from them the
right to manage their own affairs but the same
treatment had not been meted out to all other
companies or shareholders in an identical manner.

⚫The Supreme Court held that
⚫The Act is valid.
⚫A law may be constitutional even though it
applies to a single individuals if, on account
of some special circumstances or reasons
applicable to him and not applicable to
others, that single individual may be treated
as a class itself, unless it is shown that there
are others who are similarly circumstanced.
⚫The presumptions is always in the favour of
the enactment and the burden is on the
petitioner who attacks the validity of the
legislation to place all materials before the
court which would show that the selection is
arbitrary and unreasonable.

⚫In the present case Sholapur company formed
a class by itself because the mismanagement
of the company’s affairs prejudicially affected
the production of an essential commodity
and had caused a serious unemployment
amongst labourers.

Ammeerunnisa Begum v. Mahboob AIR
1953 SC 91
⚫Facts
⚫On the death of the Nawab of Hyderabad a
dispute between two rival parties regarding
succession to his property arose which
resulted in protracted litigation.
⚫In order to put an end to this long-standing
litigation the Hyderabad legislature passed
the Wali-ud-Dowla Succession Act, 1950.
⚫By this Act the claims of one party, i.e., two
ladies were dismissed and the property was
adjudged to the other party.

1953 SC 91
⚫The act was challenged on the ground that
⚫It deprived the petitioners the right to enforce
their claims in a court of law and thus
discriminated them from the rest of the
community in respect of a valuable right which
the law secures to all.
⚫The Government justified the classification
mainly on the ground that the Act was passed to
put an end to a long standing litigation.

1953 SC 91
⚫Supreme Court held that-
⚫The Act unconstitutional on the ground that it did
not furnish any reasonable ground for the
discrimination made by it.
⚫The court said that the continuance of a dispute
even for a long time between two sets of rival
claimants to the property of a private person is
not such an unusual circumstances by itself
justifying its differentiation from all other cases
of succession disputes.
⚫The exceptional circumstances which were
present in the Chiranjit Lal’s case were not
present in this case.
⚫Where the law affects the community as a whole
the court will assume the existence of some
reasonable ground for sustaining the
classification made by it.

D.S. Nakara Vs UOI
⚫ Facts
⚫ Rule 34 of the Central Services (Pension) Rules, 1972
was challenged.
⚫ In 1979 a liberalized scheme of Pension Rules was
introduced.
⚫ The scheme was applied only to those who retired
after 31-3-79.
⚫ Rule 34 classified between pensioners RETIRING
BEFORE 31-3-79 AND RETIRING AFTER THAT DATE.
⚫ The validity of classification of employees of the
Central Government on the basis of the date of
retirement was questioned.

⚫Issues
⚫Do pensioners entitled to receive
superannuation or retiring pension under
Central Civil Services (Pension) Rules, 1972 ('1972
Rules' for short) form a class as a whole?
⚫Is the date of retirement a relevant consideration
for eligibility when a revised formula for
computation of pension is ushered in and made
effective from a specified date?

D. S. Nakara v. Union of India AIR 1983 SC 130
⚫ S.C struck down Rule 34 of the Central Services
(Pension) Rules, 1972 as unconstitutional on the
ground that the classification made by it between
pensioners retiring before a particular date and
retiring after that date was not based on any rational
principle and was arbitrary and violative of Article 14
of the Constitution.
⚫ The S.C removed the unconstitutional element, viz.,
the arbitrarily fixed date as to retirement, and
allowed all the pensioners governed by the 1972 rules
to have the benefit of the 1979 rules.

R.K. Garg Vs UOI
⚫ Special Bearer Bonds Act 1981
⚫ Act "to provide for certain immunities to holders of
Special Bearer Bonds 1981 and for certain exemptions
from direct taxes in relation to such Bonds and for matters
connected therewith“
⚫ Preamble
⚫ Whereas for effective economic and social planning it is
necessary to canalize for productive purposes black money
which has become a serious threat to the national
economy;
⚫ And whereas it is expedient to provide for certain
immunities and exemptions to render it possible for
persons in possession of black money to invest the same
in the said Bonds:

Section 3(1)
⚫ 3. (1) Notwithstanding anything contained in any other law
for the time being in force :-
⚫ (a) no person who has subscribed to or has otherwise
acquired Special Bearer Bonds shall be required to disclose,
for any purpose whatsoever, the nature and source of
acquisition of such Bonds;
⚫ (b) no inquiry or investigation shall be commenced against
any person under any such law on the ground that such
person has subscribed to or has otherwise acquired Special
Bearer Bonds; and
⚫ (c) the fact that a person has subscribed to or has otherwise
acquired Special Bearer Bonds shall not be taken into
account and shall be inadmissible as evidence in any
proceeding's relating to any offence or the imposition of any
penalty under any such law.
⚫ (2) Nothing in sub-section (1) shall apply in relation to
prosecution for any offence punishable under Chap. IX or
Chap. XVII of the Indian Penal Code, the Prevention of
Corruption Act, 1947 or any offence which is punishable
under any other law and which is similar to an offence
punishable under either of those Chapters or under that Act
or for the purpose of enforcement of any civil liability.

Problem 4
⚫ S.3 of the act granted certain immunities to a person who
had invested his unaccountable money in the special
Bearer Bonds.
⚫ They were not required to disclose the nature and source
of acquisition of the Special Bearer Bonds.
⚫ It prohibited the commencement of any enquiry or
investigation against such a person.
⚫The constitutional validity of the Special Bearer
Bonds (Immunities & Exemptions) Ordinance
1981 and the Act which replaced it was challenged
on rational basis and was violative of Article 14 of
the Constitution.

R.K.Garg v. Union of India AIR 1981 SC 138 (Bearer
Bond Case)
⚫Supreme Court he 4-1 majority upheld the
validity of the Ordinance and the Act.
⚫ The object of the Act being to unearth black money for being
utilised for productive purposes with a view to effective social
and economic planning, there has necessarily to be a
classification between persons possessing black money and
others and such classification cannot be regarded as arbitrary or
irrational.
⚫ There is a practical and real classification made between
persons having black money and persons not having such
money and this de facto classification is clearly based on
intelligible differential, having rational relation with the object
of the Act.
⚫ The validity of a classification has to be judged with reference to
the object of the legislation and if that is done, there can be no
doubt that the classification made by the Act is rational and
intelligible and the operation of the provisions of the Act is
rightly confined to persons in possession of black money.

Bond Case)
⚫ Observations of the SC on the object of the Act
⚫ It was realised that all efforts to detect black money
and to uncover it had failed and the problem of black
money was an obstinate economic issue which was
defying solution and the Act providing for issue of
Special Bearer Bonds was therefore enacted with a
view to mopping up black money and bringing it out
in the open, so that, instead of remaining concealed
and idle, such money may become available for
augmenting the resources of the State and being
utilised for productive purposes so as to promote
effective social and economic planning.

Bond Case)
⚫ Observation of Supreme Court on the ground of
IMMORALITY
⚫ But the test in every such case would be not whether the
provisions of the statute offend against morality but
whether they are arbitrary and irrational having regard
to all the facts and circumstances of the case.
⚫ Immorality by itself is not a ground of constitutional
challenge and it obviously cannot be.
⚫ The provisions of the Act may seem to be putting
premium on dishonestly, and they may, not without
some justification, be accused of being tinged with some
immorality, but howsoever regrettable or unfortunate it
may be, they had to be enacted by the legislature in
order to bring out black money in the open and canalise
it for productive purposes.

New Concept of Equality: Protection against
arbitrariness
⚫E.P.Royappa v. State of Tamiladu AIR 1974 SC
555
⚫The S.C has challenged the traditional concept of
equality which was based on reasonable
classification.
⚫LAID DOWN A NEW CONCEPT OF EQUALITY.

E.P.Royappa v. State of Tamilnadu AIR 1974 SC 555
⚫ Bhagwati,J., delivering the judgement on behalf of
himself ,Chandrachud and Krishna Iyer,JJ. propounded
the new concept of equality in the following words –
⚫ “Equality is a dynamic concept with many aspects and
dimensions and
⚫ it cannot be ‘cribbed, cabined and confined’ within
traditional and doctrinaire limits.
⚫ From a positivistic point of view, equality is antithesis
to arbitrariness.
⚫ In fact equality and arbitrariness are sworn enemies;
one belong to the rule of law in republic while the other,
to the whim and caprice of an absolute monarch.
⚫ Where an act is arbitrary, it is implicit in it that it is
unequal both according to political logic and
constitutional law and is therefore violative of Article
14.”

Maneka Gandhi v. Union of India
AIR 1978 SC 597
⚫ Bhagwati,J. again quoted with approval the new
concept of equality propounded by him in the
E.P.Royappa case. He said:-
⚫ “…………Equality is a dynamic concept with many
aspects and dimensions and it cannot be imprisoned
within traditional and doctrinaire limits.
⚫ Article 14 strikes at arbitrariness in state action and
ensures fairness and equality of treatment.
⚫ The principle of reasonableness, which legally as well
as philosophically, is an essential element of equality
or non-arbitrariness, pervades Article 14 like a
brooding omnipresence.”

Air India v. Nargesh Meerza, AIR 1981 SC 1829
⚫ Regulation 46 provided that an air hostess would
retire from the service of the corporation upon
attaining the age of 35 years, or on marriage, if it took
place within four years of service or on first pregnancy,
whichever occurred earlier.
⚫ Under Regulation 47 the Managing Director had the
discretion to extend the age of retirement by one year
at a time beyond the age of retirement upto the age of
45 years if an ar hostess was found medically fit.
⚫ The court held that the termination of service on
pregnancy was manifestly unreasonable and arbitrary
and was, therefore, clearly violative of Article 14.

⚫ The regulation did not prohibit marriage after four
years and if an Air Hostess after having fulfilled the first
condition became pregnant, there was no reason why
pregnancy should stand in the way of her continuing in
service.
⚫ Having taken in service and after having utilized her
services for four years to terminate her service if she
becomes pregnant amounts to compelling the poor Air
Hostess not to have any children and thus interfere with
and divert the ordinary course of human nature.
⚫ The termination of services of Air Hostesses in such
circumstances is not only a callous and cruel act but an
open insult to Indian womanhood- the most sacrosanct
and cherished institution.

⚫ Regulation 47
⚫ The provision of extension of service of A.H “ at the
option” of the Managing Director confers a
discretionary power without laying down any guidelines
or principles and liable to be struck down as
unconstitutional.
⚫ The option to continue in service may be exercised in
favour of one A.H and not in favour of the other and is
thus discriminatory.
⚫ Under the Air India Regualtions the extension of the
retirement of an A.H was entirely at the mercy and the
sweet will of the Managing Director .
⚫ The conferment of such a wide and uncontrolled power
on the Managing Director was violative of Article 14 as it
suffered from the vice of excessive delegation of powers.

⚫ The procedure adopted by the DoT for the Grant of UAS
Licences to the private respondents was arbitrary, illegal and
in complete violation of Article 14 of the Constitution.
⚫ DoT violated the recommendations made by TRAI that there
should be no cap on the number of Access Service Providers in
any service area and this was in complete violation of Section
11(1) of the 1997 Act.
⚫ The petitioners have relied upon the report of the
Comptroller and Auditor General (CAG) and pleaded that the
consideration of large number of ineligible applicants and
grant of licenses to them is ex facie illegal and arbitrary.
⚫ The entire method adopted by the DoT for grant of licence is flawed
because the recommendations made by TRAI for grant of licences at
the entry fee determined in 2001 was wholly arbitrary,
unconstitutional and contrary to public interest.
Centre For P.I.L. & Ors. vs Union Of India &
Ors., 2012

Issues
⚫ Whether the Government has the right to alienate,
transfer or distribute natural resources/national assets
otherwise than by following a fair and transparent
method consistent with the fundamentals of the
equality clause enshrined in the Constitution?
⚫ We hold that the State is the legal owner of the natural
resources as a trustee of the people and although it is
empowered to distribute the same, the process of
distribution must be guided by the constitutional
principles including the doctrine of equality and larger
public good.

Issues
⚫ Whether the policy of first-come-first-served followed
by the DoT for grant of licenses is ultra vires the
provisions of Article 14 of the Constitution and
whether the said principle was arbitrarily changed by
the Minister of Communications and Information
Technology, without consulting TRAI, with a view to
favour some of the applicants?

Issues
⚫ There is a fundamental flaw in the first-come-first-served
policy inasmuch as it involves an element of pure chance or
accident.
⚫ In matters involving award of contracts or grant of licence or
permission to use public property, the invocation of first-
come-first-served policy has inherently dangerous
implications
⚫ A duly publicised auction conducted fairly and impartially is
perhaps the best method for discharging this burden and the
methods like first-come-first-served when used for alienation
of natural resources/public property are likely to be misused
by unscrupulous people who are only interested in garnering
maximum financial benefit and have no respect for the
constitutional ethos and values.
⚫ In other words, while transferring or alienating the natural
resources, the State is duty bound to adopt the method of
auction by giving wide publicity so that all eligible persons can
participate in the process.

⚫ Petitioner challenged coal block licenses that were
granted to private companies and certain public sector
undertakings (‘PSUs’). The Screening Committee over a
period of time had allocated 216 coal blocks to companies
without following mandatory procedure under the Mines
& Minerals Act. Screening Committee granted licenses to
ineligible applicant companies over a course of 36
meetings based on subjective and arbitrary criteria.
⚫ Supreme Court held that Central Government did not
have power to allocate coal blocks in favor private
companies. Even assuming the Central Government did,
the allocation by Screening Committee was arbitrary and
the improper allocation caused unfair distribution of
national wealth. Hence, allocations were to be cancelled.
Manohar Lal Sharma Vs UOI 2014

⚫ The Supreme Court, reiterating its ruling in the 2G Scam
case4, held that auctions did not have to be carried out in
each and every case and that courts were not equipped to
formulate a policy on allocation of public resources,
however, where such allocation was arbitrary and violated
principles of reasonableness under Article 14 of the
Constitution, the same would be struck down.
⚫ The Supreme Court noted that the Screening Committee
framed certain guidelines however rejected the same as
the guidelines applied were ‘totally cryptic and hardly
meet the requirement of constitutional norms to ensure
fairness, transparency and non-discrimination.’

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