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1958 Supreme(P&H) 72

PUNJAB & HARYANA HIGH COURT
S.S.Dulat, S.B.Capoor and R.P.Khosla JJ.
Harish Chand
Versus
Collector Of Amritsar
Civil Writ No. 149 of 1955,
Decided On : MAY 2, 1958

A provision allowing the recovery of loans as arrears of land revenue is not discriminatory and does not violate Article 14 of the Constitution if it is designed to avoid needless delay and obstruction in speedy recovery and is not arbitrary or unguided.

Headnote:

PUNJAB STATE AID TO INDUSTRIES ACT, 1935 - SECTION 35 - CONSTITUTION OF INDIA, ARTICLE 14 - RECOVERY OF LOANS AS ARREARS OF LAND REVENUE - VALIDITY - NOT DISCRIMINATORY.

Fact of the Case:

The petitioner was granted a loan under the Punjab State Aid to Industries Act, 1935, and failed to repay it. The State Government sought to recover the loan as arrears of land revenue under Section 35 of the Act. The petitioner challenged the validity of Section 35, arguing that it violated Article 14 of the Constitution by allowing arbitrary discrimination in the recovery of loans.

Finding of the Court:

The Court held that Section 35 of the Punjab State Aid to Industries Act, 1935, was not discriminatory and did not violate Article 14 of the Constitution. The Court noted that the Act authorized the State Government to advance loans to deserving industrialists but also required the prompt recovery of such loans. The Court found that the provision allowing the recovery of loans as arrears of land revenue was designed to avoid needless delay and obstruction in speedy recovery and was not arbitrary or unguided.

Issues: 1. Whether Section 35 of the Punjab State Aid to Industries Act, 1935, is discriminatory and violates Article 14 of the Constitution.

Ratio Decidendi: 1. The Court held that Section 35 of the Punjab State Aid to Industries Act, 1935, is not discriminatory and does not violate Article 14 of the Constitution. The Court noted that the Act authorized the State Government to advance loans to deserving industrialists but also required the prompt recovery of such loans. The Court found that the provision allowing the recovery of loans as arrears of land revenue was designed to avoid needless delay and obstruction in speedy recovery and was not arbitrary or unguided.

Final Decision: The Court dismissed the petition, upholding the validity of Section 35 of the Punjab State Aid to Industries Act, 1935.

Judgment

1. We are asked to consider in this case whether the provisions contained in Section 35 of the Punjab State Aid to Industries Act, 1935, are repugnant to the provisions of Article 14 of the Constitution.

2. The petitioner, at whose instance this question has been raised, was granted a loan of Rs. 5000 in October., 1950, this being one or the forms in which State aid could be given by virtue of Section 17 of the Act. To secure the loan, a bond, mortgaging a piece of land with Government, was obtained. The loan had to be repaid at a certain lime, but the petitioner did not make any payment and, in consequence, the officer empowered under the Act, issued a notice under Section 23 of the Act, and, since this did not have any effect, the competent officer issued a declaration mentioning the amount due from the petitioner. Section 24 of the Act makes such a declaration conclusive evidence of its contents and permits the production of such a declaration in a civil Court as it it were a decree of a civil Court, and section 25 of the Act requires that on the production of such a declaration the civil Court will proceed to attach the property mentioned in the declaration and fur ther proceed to realise the amount in the same manner as is done in the execution of a decree. It appears however, that in the meantime the property, that had been mortgaged, had been sold in satisfaction of some other debt due from the petitioner.

The department concerned, therefore, obtained the sanction of the State Government to recover the amount due from the petitioner as arrears of land revenue. This is permitted under section 35 of the Act which is directly in question. The section runs- "Notwithstanding anything contained in sections 23, 24 and 25, any amount payable to the State Government under this Act or by virtue of a contract entered Into under this Act including interest and cost, if any may with the previous sanction of the State Government, be recoverable as arrears of land revenue."

The petitioner objects to recourse being had to section 35 of the Act, and the contention raised on his behalf is that this provision of law is in conflict with Article 14 of the Constitution and for that reasons invalid.

3. Mr. Bhagirath Dass for the petitioner conceded at the very outset that, if section 35 had stood by itself, he could not have objected, and that his objection is not to the particular mode of recovery authorised by Section 35, namely, the recovery of the dues as arrears of land revenue, but that, since this provision stands side by side with the other provisions of the Act contained in Sections 23, 24 and 25, which clearly lav down another kind of procedure for recovery of dues, there have come to exist two different methods of proceeding against persons similarly placed resulting in the possibility of arbitrary discrimination by the State Government between one individual and another which, counsel maintains, is wholly contrary to the substance of Article 34 of the Constitution. Before proceeding with the argument as raised on behalf of the petitioner, it is useful to see what precisely Article 14 of the Constitution says. This runs-

"The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India."

There is nothing in this article concerning discrimination and, in fact, this matter of discrimination is mentioned by the Constitution itself in the next Article 15, and the specific grounds on which discrimination is forbidden are enumerated. Article 14 merely guarantees that under a particular law two or more persons shall not be differently treated.

4. It is conceded that it is in the nature of things impossible that all laws should have universal application, and that the Legislature has to be constantly engaged in devising laws to suit various classes of persons and to meet differing circumstances. Classification is, therefore, a necessary part of legislation and does not












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