Judgment

Kania, C.J.I.- This is a suit filed on 15th January 1950 under the original Jurisdiction of the Federal Court as it was functioning before the Constitution of India came into force on 26th January1950. The State of Seraikella was a State in Orissa and its Ruler was Raja Aditya Pratap Singh Deo. On 16th August 1947, the plaintiff State acceded 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, 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 with respect to which the Dominion 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 provides that by executing the same the Ruler shall not be deemed to be committed to the acceptance of any future Constitution of India or to fetter his discretion to enter into arrangements with the Government of India under any such future Constitution. It further expressly provides that nothing in the Instrument affects 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 State. It also provides that the terms of the Instrument of Accession are not to be varied by any amendment of the Government of India Act or of the Indian Independence Act, 1947, unless such amendment is accepted by the Ruler or by an Instrument supplementary to the said Instrument. It was denied in the plaint that any such supplementary instrument was executed by the Ruler and no amendment of the aforesaid Acts has been accepted by him or the plaintiff State. 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.

2. On 15th December 1947 all agreement is alleged to have been entered into between the Governor General of India and the Ruler of the plaintiff State. By that document, 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 1st January 1948. Article 2 contained a provision for the Privy Purse of the Raja and it is contended by the plaintiff that when the Raja signed the document the figure in this clause had been left blank. Under Article 3 of that agreement, it was provided that the Raja would be entitled to the full ownership, use and enjoyment of all private properties belonging to him on the date of the agreement and that by 1st January 1948 the Raja will furnish to the Dominion Government an inventory of all immovable properties, securities and cash held by him as such private property. Under Article 4, the personal privileges enjoyed by the Raja and the members of his family mentioned therein had to continue.

3. On 24th December 1947 an Act to provide for the exercise of certain extra-provincial jurisdiction of the Central Government (Act XLVII of 1947) was passed. Under Section 3 of that Act it was provided that it shall be lawful for the Central Government to exercise extra-provincial jurisdiction in such manner as it thinks fit and the Central Governme