1951 Supreme(SC) 19

SUPREME COURT OF INDIA
 9-4-1951
H.J. KANIA C.J.I., FAZL ALI, PATANJALI SASTRI, MAHAJAN, B.K. MUKHERJEA, S.R. DAS AND BOSE, JJ.
B. Venkataramana - Petnr,
Versus
The State of T.N. and another-Resps.
Petn. No. 318 of 1950.

Headnote:Accession of Indian States under Instruments of Accession -Matters arising out of Instruments of Accession-Suit relating thereto filed in Federal Court before 26th January 1950 - Supreme Court has no jurisdiction to try such suit-Articles 363 (I) and 374 (2) of the Constitution. - Articles 363 (I) and 374 (2)-Accession of Indian States under Instruments of Accession-Orders treating states as having merged in India-Suits to declare orders ultra vires and for enforcement of rights under Instrument of Accession-Suit filed in Federal Court before 26th January 1950- Jurisdiction of Supreme Court to try such suit-Interpretation of Articles 363 (I) and 374 (2).

       The State of Seraikella, a State in Orissa, acceded, on the 16th August 1947, to the Dominion of India by virtue of an Instrument of Accession executed by its Ruler and accepted by the Governor-General of India under section 6 of the Government of India Act, 1935. After reciting that under the Indian Independence Act, 1947, the Dominion of India was set up and that under the Government of India Act, 1935, as adapted, it provided that an Indian State may accede to the Dominion of India by an Instrument of Accession, the Instrument stated that the Raja acceded to the Dominion of India and that he accepted that the matters specified in the Schedule to the Instrument were the matters in respect of which the Union Legislature may make laws for the State. The three principal heads mentioned in the Schedule to that Instrument were Defence, External Affairs and Communications, with particulars detailed under each of those heads. The Instrument expressly provided that by executing the same the Ruler would not be deemed to be committed to the acceptance of any future Constitution of India or to

       1. Per Mahajan J., A.I.R. 1952 S.C., p. 267.

       fetter his discretion to enter into arrangements with the Government of India under any such future Constitution. It further expressly provided that nothing in the Instrument affected the continuance of the sovereignty in and over the State, or save as provided by or under the Instrument, the exercise of any powers, authority and rights so far enjoyed by him as Ruler of the State or the validity of any law then in force in the Stale. It also provided that the terms of the Instrument of Accession would not be varied by any amendment of the Government of India Act or of the Independence Act, 1947, unless such amendment was accepted by the Ruler or by an Instrument supplementary to the said Instrument. A Standstill Agreement was also executed by the Ruler under which it was agreed that matters of common concern and specified in the Schedule to the Agreement would continue between the Dominion of India and the said State until new agreements• were made in that behalf.

       Under an alleged agreement dated the 15th December 1947 entered into between the Governor-General of India and the Ruler of the Plaintiff State, the Raja ceded to the Dominion Government full and exclusive authority, jurisdiction and powers for and in relation to the governance of the State and agreed to transfer the administration of the State to the Dominion Government on the 1st of January, 1948.

       On the 24th of December, 1947, the Extra Provincial Jurisdiction Act was passed. Under section 4 of the Act, a notification was issued by the Central Government delegating, under section 3 the powers contained in that Act to the Province of Orissa, and subsequently to the Province of Bihar on the 18th May, 1948. On the same day the Government of Bihar passed an order called "The Seraikella and Kharaswan States Order", providing for the administration of the two States. On the 5th of January, 1949, was passed the Constituent Assembly Act I of 194-9 which added section 290-A to the Government of India Act, 1935 (relating to• the administration of certain Acceding States as a Chief Commissioners Province or as part of Governors or Chief Commissioners Province). On 27th July, 1949, the Governor General of India promulgated an Order called the States Merger (Governors Provinces) Order of 1949, by which the plaintiff State was claimed to have merged in the Province of Bihar.

       It was alleged by the plaintiff State that the Extra Provincial Jurisdiction Act, 1947, was and is ultra vires and of no effect and not binding on the plaintiff State, that the alleged agreement of the 15th December 1947 was void, for want of consideration and inoperative, that on the 18th May, 1948, without the consent and approval of the plaintiff State or its Ruler, the Province of Bihar wrongfully and illegally took over the administration of the State and passed the Seraikella and Kharaswan Administration Order, 1948, that the Dominion of India had no authority to go beyond the Instrument of Accession, had no authority to delegate powers to the Province of Bihar to administer the plaintiff State and the said order, in any event, was wrong and inoperative as it went beyond the ambit of the Extra-Provincial Jurisdiction Act, 1947, that the Governor General had no authority or power to promulgate the Order which he did on the 27th July, 1949, and the Order was void, the enactment of the Constituent Assembly Act I of 1949 being ultra vires and illegal.

       Six other suits by other States of the former Eastern Agency were filed also before the Constitution of India came into force on the 26th of January, 1950, on the same lines, except that in four of them the agreement similar to the agreement of the 15th December, 1947, Was admitted to have been executed by the Ruler and was admitted to be binding on the plaintiff.

       There was a preliminary issue also: Whether, having regard to the subject-matter of the suit and the provisions contained in article 363 (1) of the Constitution of India, the Supreme Court had jurisdiction to entertain the suit.

       Held: by majority (Kania C. J., Patanjali Sastri J. and Bose J; Mahajan and Dass JJ. dissenting): Article 374 (2) of the Constitution provides, firstly, for the removal of all suits, appeals and proceedings, civil or criminal, pending in the Federal Court to the Supreme Court and secondly provides that the Supreme Court shall have jurisdiction to hear and determine these matters. This does not give to the Supreme Court any extended jurisdiction in these matters. The opening words of Article 363(1) of the Constitution "notwithstanding anything in this Constitution" clearly established that article 363 is the controlling article over article 374 (2). The jurisdiction of the Supreme Court having been stated in articles 131-136, article 363 provides that notwithstanding anything contained in those articles and other articles of the Constitution, neither the Supreme Court nor any other Court will have jurisdiction in any dispute arising out of any provision of a treaty, agreement, covenant, engagement, sanad or other similar instrument which was entered into or executed before the commencement of this Constitution and which has or has been continued in operation after such commencement. As the suits were really to enforce the plaintiffs rights under their Instruments of Accession and the dispute between the parties really arose out of those instruments under Art. 363(1) the Supreme Court had no jurisdiction to hear the suits. This view did not involve giving any retrospective effect to Art. 361(3).

       Per Mahajan J: "Article 363 takes away the jurisdiction of this Court on certain subjects if suits about them are instituted after the 26th January 1950, or disputes concerning them arise after that date, while article 374 (2) empowers this Court to hear and to determine suits which were pending in the Federal Court of India on the 26th January, 1950, and which the Court was competent to try and determine. There is no conflict between these two articles. They operate on two different fields. The Federal Court of India had jurisdiction by virtue of the provisions of section 204 of the Government of India Act, 1935, to determine certain suits between acceding States and the Government of India with respect to certain subject matters and that jurisdiction was continued for the time being and was conferred on this Court. The original jurisdiction to the Supreme Court is conferred by Article 131 in respect of similar suits but it does not embrace all the subjects that were covered by section 204 of the Government of India Act, 1935 The Constitution of India has no retrospective operation. Article 363 of the Constitution has therefore to be given a prospective operation and as such it cannot affect suits pending before the 26th January 1950. Once it is held that the whole article operates prospectively on suits that are brought after the 26th January, 1950, or on disputes that arise after that date, then the opening words of the article cannot affect cases transferred to this Court from the Federal Court under the provisions of article 374 (2) of the Constitution . ... ... The article has no retrospective operation and only affects disputes that would arise after the 26ihJanuary, 1950.

       Per Das J. Das J. based his decision on issue No. 6 which was to the effect, "whether having regard to the provisisons of the Constitution, the plaintiff has a legal capacity and is entitled to maintain the suit", and held: "The question is whether the territories of the plaintiff States were in fact being administered as if they formed part of the Provinces of Bihar pr Orissa and whether such territories were being so administered by virtue of an order made under section 290-A of the Government of India Act. There can be no doubt that the answer must be in the affirmative. This Court is bound by the Constitution and cannot question the validity of any orits provisions. The Constitution says that the territories of Bihar and Orissa shall comprise the territories specified in Part A and this court must accept that position. None of these States is included amongst the States named in Parts A, Band C. Our Constitution does not recognize any of these States as an acceding State. The Government of India Act which recognised them as acceding States has been repealed. Therefore, the plaintiff States have no existence in the eye of the Constitution and cannot come to this Court to enforce their political rights. After the repeal of the Government of India Act and the commencement of the Constitution, none of these States is an acceding State which may continue a suit filed under section 204. The suits must, therefore, be regarded as having abated by reason of the elimination of the plaintiff States as States or acceding States just as an ordinary suit would abate on the death of a plaintiff." - Section 80-Does not apply to suit instituted in Federal Court.

       Held: "Rule 5 of the Federal Court Rules framed under section 214 of the Government of India Act lays low in clear and unambiguous language that none of the provisions of the Code of Civil Procedure shall apply to any proceedings in the Federal Court unless specifically incorporated in these rules. The provisions of section 80 have not been incorporated in the rules and that being so, section 80 cannot affect suits instituted in the Federal Court under Section 204 of the Government of India Act, 1935 Section 80 does not define the right of parties or confer any rights on the parties. It only provides a mode of procedure for getting the relief in respect of a course of action. It is a part of the machinery for obtaining legal rights ie. machinery as distinguished from its products." (Per Mahajan J.)