Retrospective statutory resumption of a palace used as a hotel was challenged as discriminatory. The court dismissed the State's appeal and upheld invalidation of the Resumption Act under Article 14, while rejecting the separation-of-powers challenge and leaving title undecided.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE THE AG.CHIEF JUSTICE MR.ASHOK BHUSHAN & THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE
MONDAY, THE 8TH DAY OF DECEMBER 2014/17TH AGRAHAYANA, 1936
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AGAINST JUDGMENT IN WP(C) 31820/2005 OF HIGH COURT OF KERALA DATED 07-01-2011
APPELLANT(S)/RESPONDENTS 1 TO 4 IN THE WPC:
1. STATE OF KERALA, REP. BY THE CHIEF SECRE CHIEF SECRETARY, GOVERNMENT OF KERALA, SECRETARIAT THIRUVANANTHAPURAM-695 001.
2. THE SECRETARY, DEPARTMENT OF TOURISM, GOVERNMENT SECRETARIAT THIRUVANANTHAPURAM-695 001.
3. THE DISTRICT COLLECTOR, THIRUVANANTHAPURAM, KERALA STATE, PIN-695 043.
4. THE TAHSILDAR, NEYYATTINKARA, THIRUVANANTHAPURAM DISTRICT KERALA STATE, PIN-695 121.
BY ADVS.SRI.JAYADEEP GUPTA (SR.) BY GOVERNMENT PLEADER SHRI T.T. MUHAMOOD
RESPONDENT(S)/PETITIONERS 2 & 3 AND RES. 5 & 6 IN THE :
1. HOTEL LEELAVENTURE LTD. AND 3 OTHERS REGISTERED UNDER THE COMPANIES ACT, 1956 HAVING ITS REGD. OFFICE AT THE LEELA SAHAR MUMBAI-400059 REP.BY ITS EXECUTIVE DIRECTOR, MR. VENU KRISHNAN.
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2. MR. VENUKRISHNAN, DIRECTOR, KOVALAM HOTELS LTD., A COMPANY REGD. UNDER THE COMPANIES ACT 1956, HAVING ITS REGD. OFFICE AT GARMENT COMPLEX, PLOT, NO.16A 3RD, FLOOR, COCHIN SPECIAL EXPORT PRO
3. UNION OF INDIA, REP. BY THE SECRETARY, MINISTRY OF TOURISM, GOVERNMENT OF INDIA, NEW DELHI PIN-110 001.
4. INDIA TOURISM DEVELOPMENT CORPORATION, (I.T.D.C.), HAVING ITS REGISTERED OFFICE AT SCOPE COMPLEX, CORE-8, 6TH FLOOR 7, LODHI ROAD, NEW DELHI-110 003. R1,R2 BY ADV. SRI.G.BIJU R3 BY ADV. SRI.N.NAGARESH, ASSISTANT SOLICITOR GENERAL
THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 12.11.2014, THE COURT ON 08-12-2014 DELIVERED THE FOLLOWING:
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APPENDIX
APPELLANT'S EXHIBITS:
ANNEXURE-A TRUE COPY OF ORDER G.O.(MS) NO.242/70/PD DATED 18.7.1970. ANNEXURE-B TRUE COPY OF ORDER G.O.(MKS) NO.357/70/PD DATED 22.10.1970. ANNEXURE-C TRUE COPIES OF ORDER G.O(MS) NO.259/2004/GAD DATED 18.09.2004 ALONG WITH ENGLISH TRANSLATION AND ORDER G.O.(P) NO.302/2004/RD DATED 25.09.2004. ANNEXURE-D TRUE COPY OF LETTER DATED 08.03.2002. ANNEXURE-E TRUE COPY OF LETTER DATED 03.05.2002. ANNEXURE-F TRUE COPY OF WP(C) NO.28270 OF 2004. ANNEXURE-G TRUE COPY OF INTERIM ORDER DATED 28.09.2004 IN W.P(C) NO.28270 OF 2004. ANNEXURE-H TRUE COPY OF W.A. NO.1796 OF 2004 ANNEXURE-I TRUE COPY OF INTERIM ORDER DATED 1.10.2004 IN W.A. NO.1796 OF 2004 ANNEXURE-J TRUE COPY OF COUNTER AFFIDAVIT ON BEHALF OF GOVERNMENT OF KERALA DATED 7.10.2004 IN W.P(C) 28270 OF 2004. ANNEXURE-K TRUE COPY OF COUNTER AFFIDAVIT OF THE UNION OF INDIA DATED 7.12.2004 IN W.P(C) NO.28270 OF 2004. ANNEXURE-L TRUE COPY OF COUNTER AFFIDAVIT OF ITDC DATED 22.11.2004 IN W.P(C) NO.28270 OF 2004.
ANNEXURE-M TRUE COPY OF COMMON JUDGMENT DATED 8.4.2005 IN W.A. NO.1796 OF 2004 AND IN W.P(C) NO.28270 OF 2004.
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ANNEXURE-N TRUE COPY OF THE KOVALAM PALACE (TAKING OVER BY RESUMPTION) ACT 2005.
RESPONDENT(S)' EXHIBITS: NIL
TRUE COPY
“C.R.”
ASHOK BHUSHAN, Ag. C.J. and A.M. SHAFFIQUE, J.
==================================== W.A. No.250 of 2011
==================================== Dated this the 08th day of December, 2014
J U D G M E N T
Ashok Bhushan, Ag. C.J.
The State of Kerala has filed this Writ Appeal against the judgment of the learned Single Judge dated 07.01.2011 in W.P(C) No.31820 of 2005 - Kovalam Hotels Ltd. & Others v. State of Kerala and Others
declaring the Kovalam Palace (Taking Over by Resumption) Act, 2005 as unconstitutional, void and inoperative.
Resumption) Act, 2005 (hereinafter referred to as 'the Resumption Act, 2005') came to be enacted on 12.08.2005 after a series of events, which need to be
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noted in detail for appreciating the issues, which have arisen in the Writ Appeal.
Ministry of Tourism, Government of India was the fifth respondent and India Tourism Development Corporation (ITDC) was the sixth respondent. Counter affidavits were filed by the State, Union of India and the ITDC in support of their respective claims. The petitioners had filed reply to the counter affidavit of the State. The learned Single Judge, after hearing the parties at length, allowed the Writ Petition declaring the Resumption Act, 2005 as unconstitutional, void and inoperative.
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of 18.10.00 Acres in various survey numbers, including an area of 13.55 Acres in Sy.No.385/1 to Sri.Makayiram Thirunal Rama Varma Valiya Koi Thamburan (hereinafter referred to as 'M.T.Rama Varma'). The Department of Tourism, Government of Kerala, in the year 1962 initiated proceedings of acquisition under the Land Acquisition Act for acquiring an area of 19.13.782 Acres of land, including an area of 10.18.993 Acres in Sy.No.385/1, on which Halcyon Castle/Kovalam Palace was situated. Compensation for acquisition of land was determined as `5,26,431/- and paid to Shri M.T.Rama Varma. The Department of Tourism took possession of the land on 02.05.1964. The Kerala Tourism Development Corporation took over the above property and started running of a hotel, namely, 'Kovalam Palace Hotel'. The ITDC was established as a wholly owned Government of India Company for the development and promotion of tourism in India. The ITDC made plan to
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develop Kovalam as one of the major tourist destinations. The ITDC, through the Union of India, requested the State Government to acquire some land for the construction of a five star hotel and related tourist facilities. The State Government positively responded to the proposal and expressed its willingness and agreed to hand over Kovalam Palace and adjoining land for consideration. A series of deliberations and correspondence took place between the ITDC/Union of India and the State Government for finalisation of modalities of transfer. The Government of India, Ministry of Tourism & Civil Aviation, Department of Tourism with reference to the correspondence resting with the letter dated 29.11.1969 of the Government of Kerala, communicated sanction of the President of India for payment of a sum of ₹`9,50,534.30 to the Government of Kerala for the transfer of ownership of the Kovalam Palace property along with the beach at Kovalam
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measuring about 43 Acres acquired by the State Government for the Kovalam tourist project. The Government of Kerala vide order dated 18.07.1970 sanctioned possession of the Kovalam Palace and the adjacent property measuring 43 Acres acquired for the Kovalam project being handed over to the Department of Tourism, Government of India, pending finalisation of the terms and conditions of the transfer. The Managing Director, Kerala Tourism Development Corporation on 23.10.1970 handed over 21 Acres 31 cents of Palace property and 22.39 Acres belonging to private parties to the Additional Director General of Tourism, Government of India. In continuation of Government Order dated 18.07.1970, the Government of Kerala also sanctioned possession of beach house and P.W.D bathing shed measuring 8.48 Acres to the Department of Tourism, Government of India. Between 1972 and 1976 the Government of Kerala, under the Land
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Acquisition Act, 1894, acquired other properties from private individuals for the public purpose of ITDC for implementation of Kovalam development project. Details of the correspondence and compensation paid have been mentioned in paragraph 20 of the Writ Petition. The ITDC made additional building and established a Beach Resort known as 'Kovalam Grove' in 1976 adding 88 rooms. Further, 64 guest rooms were added in 1994. The transfer being between Government of India and Government of Kerala, no particular documents similar to sale deeds were entered into between the two Governments. The ITDC continued with peaceful enjoyment of 64.5 Acres of land with buildings to the exclusion of others. The revenue records maintained by the State Government and other statutory authorities recorded the ITDC as the owner. Settlement Register prepared on the basis of re-survey, which was held by the State Government from 1971 to
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1974, recorded 64.5 Acres as property of the ITDC. The Government of India set up Disinvestment Commission, which identified hotels as non-core business and further opined that the initial objectives of the public sector in the Hotel industry had been met. The Government of India approved the disinvestment and its holding in the ITDC. The ITDC proceeded to sell various hotels throughout the country. In January, 2002, the Government of India published expression of interest offering to sell nine hotels, which also included Kovalam Ashok Beach Resort (64.50 Acres). The first petitioner submitted an expression of interest to the Union of India. Offer of the first petitioner for `₹43,68,76,000/-, which was the highest among the 29 persons who responded to the expression of interest, was accepted by the Government of India which decided to transfer the ownership and possession to the first petitioner. Notice for approval of scheme of arrangement for
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demerger of the Kovalam Ashok Beach Resort was published in the 'New Indian Express' and 'Malayala Manorama' dailies in Thiruvananthapuram editions on 14.02.2002 clearly outlining the modalities of disinvestment and objections were invited. By order dated 21.05.2002 the Government of India granted sanction to a scheme of arrangement by which sanction and approval of demerger scheme was granted transferring the Kovalam Ashok Beach Resort to the first petitioner. The Government of India sold shares by two share purchase agreements in favour of the first petitioner and the first petitioner became the owner and in possession of 64.5 Acres of land, including the building as well as the business. The first petitioner continued to run the hotel and its business as was being run by the ITDC from the year 1972 to 2002.
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M.T.Rama Varma, requesting to retain the Halcyon Castle, Kovalam as a heritage site. The State Government issued Government Order dated 18.04.2004, which reads as under:
“The order is issued deciding to take over Kovalam Palace and the land in which it is located.”
Another Government order dated 25.09.2004 was issued, which mentioned that the State Government had sanctioned possession of Kovalam Palace and the adjoining property measuring 43 Acres of land and possession was handed over on 23.10.1970 to the Government of India pending finalisation of terms and conditions of transfer. However, the terms and conditions of the transfer have yet not been finalised. The Government order further mentioned about the representation dated 06.06.2004 and communicated its decision to take over the Kovalam Palace and the land measuring 10.18.99 Acres in Sy.No.385/1 (Re-Survery No.7/1) with immediate effect. The District Collector,
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Thiruvananthapuram issued notice dated 25.09.2004, which was delivered at 6.45 p.m directing the first petitioner to deliver possession before 10 a.m on 27.09.2004. 26.09.2004 being Sunday, the petitioners could file WP(C).No.28270 of 2004 before this Court only on 27.09.2004. On 28.09.2004 this Court passed interim order in the Writ Petition. Aggrieved by the interim order petitioners 1 and 2 filed W.A.No.1796 of 2004. The Division Bench passed an order dated 01.10.2004 in the Writ Appeal restraining the Government from taking possession of the remaining buildings and premises. In the Writ Appeal counter affidavits by the State, Union of India and ITDC were filed. Both W.P(C).No.28270 of 2004 and W.A.No.1796 of 2004 were allowed by the Division Bench of this Court vide judgment dated 8.4.2005, which is reported in M. Far Hotels Ltd. v. Union of India (2005(1) KLJ 819). The Division Bench held that the action of the State Government in taking
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possession was arbitrary and without authority of law. Government order dated 25.09.2004 was set aside, including the notice issued by the District Collector. The State of Kerala and its revenue officers were directed to give back possession to the petitioner. The Division Bench also observed that the judgment, however, would not stand in the way of the State of Kerala to proceed through known process of law. The State of Kerala filed Special Leave Petitions before the Supreme Court against the judgment of the Division Bench as SLP. (Civil).Nos.8603 & 8604 of 2005. On request of the State, hearing was adjourned by the Supreme Court. The State, meanwhile came with the Kovalam Palace (Taking Over by Resumption) Ordinance, 2005. The Ordinance was replaced by the Act, namely, Kovalam Palace (Taking Over by Resumption) Act, 2005 published in the Kerala Gazette dated 12.08.2005. Thereafter the petitioners filed W.P(C).No.31820 of 2005 giving
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complete details of facts and events. The Resumption Act, 2005 was challenged as unconstitutional. Following are the reliefs, which were claimed in W.P(C).No.31820 of 2005:
by the State Government, Union of India and ITDC. The petitioners filed reply. The learned Single Judge by his impugned judgment dated 07.01.2011 allowed the Writ Petition and declared the Resumption Act, 2005 as ultra vires, void and inoperative. Aggrieved by the judgment of the learned Single Judge, this Writ Appeal has been filed by the State.
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learned counsel for the parties, it is also relevant to note the pleadings of the parties in respect of their respective cases as is on record in the Writ Petition. The petitioners challenged the Resumption Act, 2005 on various grounds, including the Act being violative of Article 14 of the Constitution, discriminatory and arbitrary. The petitioners' properties have been singled out. The property was transferred to Government of India for all practical purposes and was being enjoyed by the ITDC for the last 32 years without any objection or claim. The property, which was owned by the Government of India, has been transferred to the petitioners' Company in furtherance of disinvestment scheme and no objection having been raised by anyone including the State Government, it is not open for the State Government to assert title. By the enactment, the unlawful act of the State to take forceful possession was sought to be validated. The State had taken decision to take
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possession of the property due to political pressure, which was disapproved by the Division Bench of this Court in its earlier judgment. The enactment is a colourable legislation. The property is neither a heritage site nor an ancient monument. The act is violative of Article 300A of the Constitution of India. The enactment has been made to avoid compliance and to overreach the Division Bench judgment of this Court. The legislature has transgressed its legislative power and has adopted device to out step limits of its power. The enactment seeks to nullify the executive act of the Union of India which is against the federal structure of the Constitution of India. The Act is in defiance of the judgment of the Division Bench of the High Court.
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and conditions of the transfer. It is stated that the possession given to the Government of India was only a permissive possession and by the terms and conditions of transfer having not been finalised the State continued to be owner of the property. It is stated that the executive action of the State Government, i.e., Government Order dated 25.09.2004 having been set aside by the Division Bench on the ground that the State, by the administrative action, cannot take possession of the property, the State has enacted the Resumption Act, 2005, which is well within its legislative competence. It is stated that the Division Bench in its judgment dated 07.01.2011 has already granted liberty to the State to take action by known process of law.
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were throughout full owner of the property. The Government of India stated that the property was transferred to the 6th respondent, who acquired absolute, clear and marketable title, in the revenue records, including Thandaper Account No.17653, the property was shown to be owned by the ITDC. In the settlement register prepared on the re-survey the scheduled property has shown as ITDC property. In furtherance of deinvestment policy, the property was transferred by share purchase agreement by the President of India through representation by the Joint Secretary, Ministry of Tourism, Government of India.
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Sri.L.Nageshwara Rao, Senior Advocate assisted by Shri G.Biju, Advocate appearing for the respondents 1 and 2 and Sri.N.Nagaresh, Assistant Solicitor General of India appearing for respondents 3 and 4.
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Kovalam Palace and to protect the same as a heritage site. The State has legislative competence to pass the legislation. The State having legislative competence, the Statute cannot be struck down. Unconstitutionality must be plainly and clearly established before the enactment is declared void. First endeavour should be to uphold the legislation rather than declaring it invalid. No valid ground exists to challenge the validity of the impugned legislation. The ground on which the legislation was struck down is erroneous in as much as the ground is based on a wrong assumption that the impugned legislation amounts to deciding a title dispute between State of Kerala and Union of India. There was neither any title dispute pending as projected by the respondents nor did the impugned legislation decide any disputed title. Prior to the disinvestment itself, the Union of India was aware that ITDC had no title over the disputed property and accordingly the Joint secretary,
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Ministry of Tourism, Government of India had written to the Secretary Tourism, Government of Kerala admitting that the documents available with ITDC do not provide adequate evidence of ITDC's legal title to the entire land in possession. A letter was written on 3.5.2002 by the Chairman and Managing Director of ITDC to the Secretary, Tourism for solving the issue of title. In the earlier Writ Petition the predecessor-in-interest of the respondents did not assert their title and they pleaded that they are in permissible possession. The resumption of possession is confined to the Palace and its appurtenant land. The impugned Act was passed by the State Legislature in public interest to preserve and protect the historic Kovalam Palace. There is provision for payment of compensation in the Act.
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raised the following submissions:
(a) The Resumption Act, 2005 seeks to decide an existing property dispute through a legislative declaration instead of a judicial adjudication of the rights of the parties by a civil court of competent jurisdiction. It is a clear attempt by the State Legislature to encroach into the judicial domain and perform the core judicial function of adjudication of legal disputes. The adjudication of legal disputes is exclusively a judicial function and cannot be performed by legislature.
(b) The higher constitutional principles of rule of law and separation of powers have been held to be intimately connected and part of the basic structure of the Constitution. Further, the doctrine of separation of powers has been held to be nothing but a consequence of the principles of equality enshrined under Article 14. By encroaching into the judicial domain and purporting to perform an exclusive judicial function, the 2005 Act
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violates the principles of rule of law and separation of powers. Thus, the 2005 Act is contrary to Article 14 and the basic structure of the Constitution.
(c) It is now established that legislation can be struck down as unconstitutional, when it is contrary to the basic structure. The applicability of the basic structure test is no longer restricted to test the validity of constitutional amendments alone, and the test is available even as regards ordinary legislation. Since the 2005 Act violates the basic structure of the Constitution, it must be held to be invalid.
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pursuant to the disinvestment policy adopted by the Union of India in 2002, which are fully demonstrated from the pleadings in the affidavits filed in the Writ Petition. The State of Kerala having come with the case that they had only given permissive possession over the property, the dispute regarding title was very much there in which background the State came with the 2005 enactment.
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parties and the pleadings on record, the following are the issues, which arose for consideration in this Writ Appeal:
(I) Whether the Kovalam Palace (Taking over by Resumption) Act, 2005 seeks to decide an existing property dispute through legislative declaration thereby encroaching into the judicial domain violating the doctrine of separation of power?
ISSUE NO.I
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Government Order dated 25.09.2004, directed to take possession of Kovalam Palace which was challenged by petitioners in the writ petition before this Court. A Division Bench of this Court vide its judgment and order dated 08.04.2005 had allowed the writ petition and quashed the Government Order dated 25.09.2004. The Division Bench after noticing the sequence of events and facts of the case laid down in paragraph 10 of the judgment reported in M.Far Hotels Ltd. v. Union of India & others [2005(1) KLJ 819] as follows:
“10. We are, in this case, concerned only with the legality of the Government order GO(P) No. 302/2004/RD dated 25.9.2004 and the notice issued by the District Collector for repossessing the property from the writ petitioner. Undisputedly the first petitioner is in permissive possession even according to the State Government. Union of India and ITDC have categorically stated that the State Government has divested all its right, title and interest over the property to Union of India and ITDC. The State of Kerala in their counter affidavit stated that the Government order has been issued in exercise of its
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executive power under Article 162 of the Constitution of India. They have no case that the State has taken resort to the provisions of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 or through any other law. It is trite law that State Government cannot while taking recourse to the executive power of the State under Article 162, deprive a person of his property and such power can be exercised only by authority of law and not by a mere executive fiat or order. Article 300A of the Constitution of India states that no person shall be deprived of his property save by authority of law. Article 162 of the Constitution does not permit the State to deprive of a person of his property through executive orders. State executive is not authorised to deprive a person of his property without reference to any law or legal authority. The apex court, in Wazir Chand v. The State of Himachal Pradesh, 1955 SCR 408, while dealing with the question as to whether seizure of property not sanctioned by section 61, 96, 98 and 165 of the Code of Criminal procedure infringes fundamental rights under Article 19 and 31 of the Constitution, noticed that the procedure adopted in that case was in utter violation of the provisions of law and could not be defended on the basis of any legal authority. Apex Court in Bishan Das and Others v. The State of Punjab and Others, 1961
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(2) SCR 69 held that the executive action taken to dispossess the petitioners therein was destructive of the basic principle of the rule of law. Contention was raised before the apex court that petitioners therein were deprived of property by the State and its officers in pursuance of executive orders without authority of law and they have been denied equal protection of the laws and their fundamental right to hold property has been violated in a most arbitrary manner which is destructive of the basic principles of the rule of law granted by the Constitution. Ultimately apex court opined as follows:
“In these circumstances the action of the Government in taking the law into their hands and dispossessing the petitioners by the display of force exhibits a callous disregard of the normal requirements of the rule of law apart from what might legitimately and reasonable be expected from a Government functioning in a society governed by a Constitution which guarantees to its citizens against arbitrary invasion by the executive of peaceful possession of property.”
In Bishambhar Dayal Chandra Mohan v. State of U.P, (1982) 1 SCC 39 apex court held that executive order under Article 162, for seizure of any property without any authority of law, violates Article 300-A of the Constitution. Court held that under Article 300-A no person shall be deprived of his property, save by authority of law. The State Government cannot while
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taking recourse to the executive power of the State under Article 162, deprive a person of his property. Such power can be exercised only by authority of law and not by a mere executive fiat or order. In State of U.P v. Maharajs Dharmander Prasad Singh, (1989) 2 SCC 505 apex court held that possession of a lessee, even after the expiry or its earlier termination, is juridical possession and forcible dispossession is prohibited, a lessee cannot be disposed otherwise than in due course of law. See Dwaraka Prasad Agarwal v. Ramesh Chandra Agarawala, AIR 2003 SC 2696.”
“12. We remind the State Government that they shall not be carried away by pressure groups who exert pressure on Government to obtain decisions compatible with their interests to violate rule of law and rights of others. A group of people styling themselves as Palace Liberation Organisation
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had attempted to forcefully enter the property. Petitioners had to file WP(C) No.30225/01 and obtain police protection to protect their life and property. Responsible and elected form of Government can only act in accordance with the constitution and the laws of our country. Pressure groups and vested interest may voice their concern in a democracy. Political parties and other public men would bring into focus various issues either for public or personal interest. Pressures from various quarters at times push the executive out of track and the executive tends to adopt various measures which are undemocratic and unknown to law. Democratically elected civilised form of Government should withstand such pressures to act in accordance with law, so that life and property of the citizen would be safe, and the legal rights of the citizen are not violated.
13. We have no hesitation to say that the Government was carried away by the pressure exerted from various quarters to undo even according to the Government, “permissive possession” of the petitioners. The first petitioner admittedly is not a trespasser, but came into possession through a process known to law, by participating in a global tender, in which the petitioners made highest offer, which was accepted. Union of India and ITDC in their counter affidavits have stated that they had parted
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with the palace and the appurtenant properties to the first petitioner through a process known to law as part of a policy of disinvestment. Under our jurisprudence, even an unauthorised occupant can be evicted only in a manner authorised by law, which is essence of rule of law.”
were not in illegal possession and can be dispossessed only through a process known to law and not through executive fiat. While allowing the writ petition following was laid down in paragraphs 14 and 15:
“14. Senior counsel appearing for the writ petitioners fairly submitted that this court under Article 226 of the Constitution need not examine the question as to whether the 1st petitioner has got title over the property in question since that is to be resolved by a civil court. We are in this case primarily concerned with the question as to whether the petitioners are in legal possession of the property. We have no hesitation to say that they are in legal possession of the property and they can be dispossessed only through a process known to law and not through executive fiat. State Government in our view have showed tremendous haste to
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dispossess the petitioners. Possession was with the Union of India and the ITDC for over three decades and the hotel was being conducted in the Kovalam palace for over several years without any complaint from any quarters. Haste shown by the State Government to dispossess the petitioners, on a Monday in our view was undemocratic, that too even without serving a show cause notice and not following the principles of natural justice”.
15. The Government Order Ext.P13 dated 25.09.2004 therefore cannot stand in the eye of law, so also the notice issued by the District Collector pursuant to the Government order. Those orders are accordingly quashed and there will be a direction to the State of Kerala and its Revenue Officials to put the petitioner back in possession of the items of properties taken possession from them forthwith. Writ Appeal and writ petition are accordingly allowed with cost of Rs.10,000/- to be paid to the first petitioner by the State Government. This judgment, however, would not stand in the way of the State of Kerala to proceed through known process of law, in respect of which we express no opinion.”
of this Court dated 08.04.2005, a Special Leave Petition was filed by the State in Supreme Court in which on two dates,
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the State prayed for adjournment and when the matter was taken up on 10.05.2005 time was taken to bring on record the copy of the Act. On 09.05.2005 Ordinance was promulgated, being Ordinance No.6 of 2005. On 12.08.2005 the Act namely Kovalam Palace (Taking Over by Resumption) Act, 2005 was published in gazette. The Act was enacted to provide for taking over and protection by resumption of the historic site of Kovalam Palace and the surrounding buildings and lands, by the Government of Kerala. The preamble of the Act read as follows:
“Preamble.- WHEREAS, the Government of Kerala had sanctioned the possession of the Kovalam Palace and the adjacent property measuring 4.13.30 hectares along with other lands to the Department of Tourism, Government of India in the year 1970 for the purpose of development of tourism in Kerala pending finalizations of the terms and conditions of transfer;
AND WHEREAS, the terms and conditions of transfer have not been finalized thereafter;
AND WHEREAS, the India Tourism Development Corporation, the agency of the Department of Tourism, Government of India which had been in
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possession of the Kovalam Palace and the surrounding buildings and lands had retransferred the possession of the buildings and lands to M/s.M-Far Hotels Limited, a company registered under the Companies Act, 1956 consequent on the privatization of Hotels by the Government of India during July, 2002;
AND WHEREAS, the said transfer was without the prior consent of the Government;
AND WHEREAS, the Government are still the owner and the title holder of the said Kovalam palace;
AND WHEREAS, the Government had taken over possession of the Kovalam Palace building and a major portion of the surrounding lands on the 27th day of September, 2004 consequent on the Government Order in G.O.(P) No.302/2004/RD issued on the 25th day of September, 2004;
AND WHEREAS, the Hon'ble High Court of Kerala has in its judgment dated 8th April 2005 in WA No.1796 of 2004 in M/s.M-Far Hotels Ltd. and another v. Union of India & Ors. has quashed the Government Order by which the possession was taken;
AND WHEREAS, the Hon'ble High Court has observed that the petitioner therein could not be dispossessed of property save by authority of law and also observed that the judgment would not stand in
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the way of the State of Kerala to proceed through a known process of law;
AND WHEREAS, the historic site of Kovalam Palace is also one of tourist attraction and serve the public purpose of tourism;
AND WHEREAS, it is expedient in the public interest to ensure that the interests of the general public are served by retaining the Kovalam Palace to serve the public purpose and in particular by retaining the Kovalam Palace and the surrounding lands as object of historic interest and heritage site;
AND WHEREAS, the above said object has to be achieved by retaining the Kovalam Palace and the surrounding lands as object of historic interest and heritage site;”
Section 1(2) of the Act provided that the Act shall be deemed to have come into force on the 25th day of September, 2004 on which date the State Government had issued Government Order for taking possession of the Kovalam Palace. Section 3 of the Act provided for taking
over by resumption of Kovalam palace. Section 3(2) provides that the possession of the historic site of Kovalam Palace already taken by the Government on the 27th day of
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September, 2004 shall be deemed to have been taken under the provisions of this Act and shall be deemed to be possessed as validly taken under the provisions of this Act on and from the 27th day of September, 2004. Sections 3 and 4 read as under:
“ 3. Taking over by resumption of Kovalam
Palace .- (1) Notwithstanding anything contained in any other law for the time being in force or in any judgment, decree or order of any Court or in any contract or other document, with effect on and from the date of commencement of this Act, the possession of the historic site of Kovalam Palace shall stand transferred to and vest in the Government free from all encumbrances and the right title and interest of all other persons in respect of the lands and buildings shall stand extinguished.
(2) Notwithstanding anything contained in any other law for the time being in force or in any judgment, decree or order of any Court or in any contract or other document, the possession of the historic site of Kovalam Palace already taken by the Government on the 27th day of September, 2004 shall be deemed to have been taken under the provisions of this Act and shall be deemed to be possessed as validly taken under the provisions of this Act on and
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from the 27th day of September, 2004.
4. General effect of vesting .- (1) Notwithstanding anything contained in any other law for the time being in force or in any judgment decree or order of any Court or in any contract or other arrangement in so far as it relates to the historic site of Kovalam Palace in force immediately before the commencement of this Act shall be deemed to have been terminated on such commencement.
(2) All persons in charge of the historic site of Kovalam Palace who had managed its affairs with permissive possession of the Government immediately before the commencement of this Act shall be deemed to have vacated their charge of management on such commencement.”
Section 5(1) provides for payment of compensation for improvements. Section 5 reads as follows:
“ 5. Payment of amount .- (1) For any improvements made to the historic site of Kovalam Palace and for the value of any interest which may have accrued in favour of any person during the period from the date of handing over of the possession by the Government in 1970 to the date of resumption by the taking over by the Government under S.3, there shall be given by the Government for the value of such improvements made to Kovalam
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Palace or any other right which shall have accrued to any person an amount by way of compensation by following the principles specified in sub-s.(2).
(2) The principles to be observed in the payment of compensation shall be:-
(a) in respect of any improvement made to the building or the land, the value for such improvement shall be at the rate prevalent at that time;
(b) depreciation at the rate of five per cent per annum subject to a maximum of fifty per cent towards cost of building;
(c) for any interest which may have accrued, its value may be computed in the manner as may be prescribed;
(d) any improvement made without the legal sanction from the Local Self Government Institutions or Local Authorities or other Government Authorities in the said area shall not be eligible for compensation.”
Section 6 provided for appointment of an officer not below the rank of District Collector as Commissioner for payment of compensation. Section 7 provided for filing of claim before the Commissioner. Section 8 provided for appeal by
claimants before the Principal District Court of
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Thiruvananthapuram. Section 9 gave an overriding effect to
the Act which is to the following effect:
“ 9. Act to have overriding effect .- The provisions of this Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any law other than this Act or in any instrument having effect by virtue of any law other than this Act or in any decree or order of any Court or other authority.”
Section 11 indicates the bar of jurisdiction of Civil Court which reads as under:
“ 11. Bar of jurisdiction of Civil Court. - Except as otherwise provided in this Act, no Civil Court shall have jurisdiction to decide or deal with any question or to determine any matter which is, by or under this Act, required to be decided or dealt with or to be determined by the Commissioner or any other officer.”
Section 14 was a validation provision which provided as follows:
“ 14. Validation. - Notwithstanding anything contained in the Government Order in G.O.(P) No.302/2004/RD issued on the 25th day of September, 2004, or in any judgment, decree or
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order of any Court, all acts done in the matter of taking possession of the historic site of Kovalam Palace and the surrounding buildings and lands during the period from the 25th day of September, 2004 to the date of publication in the Gazette of the Kovalam Palace (Taking Over by Resumption) Ordinance, 2005 shall be deemed to have been validly done under the provisions of this Act and accordingly no suit or other proceeding shall be maintained or continued in any Court or before any authority for divesting the Kovalam palace and the surrounding buildings and lands.”
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Although the division is not precisely demarcated, there is general acknowledgment of its limits with certain measure of overlapping. Our Constitution recognizes and gives effect to the concept of equality between the three wings of the State and the concept of “checks and balances” inherent in such scheme. Judiciary should give due regard to the fundamental nature and importance of the legislative process. Equity or equitable considerations play no role in interpreting constitutional provisions dealing with the distribution of powers among the three wings of the Government. Any executive order or legislative enactment of a State which interferes with the adjudicatory process or adjudication by any Tribunal or Court would amount to interference with the judicial power of the State and hence would be ultra vires the Constitution.” The Constitution of India contains several provision to ensure independence of judiciary. Independence of
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judiciary is the sine qua non of democracy. So long as the judiciary remains truly distinct from both the Legislature and the Executive, the general power of the people can never be endangered from any quarters. Montesquieu in his book Spirit of Laws observed “there is no liberty, if the power of judging be not separated from the legislative and the Executive powers”. The framers of the Constitution made it known in an emphatic voice that separation of judiciary from Executive, which is the life line of 'independent judiciary', is a basic feature of the Constitution. Dr.B.R. Ambedkar in his speech in the Constituent Assembly on June 7, 1949 observed as under. “I do not think there is any dispute that there should be separation between the executive and the judiciary and in fact all the articles relating to the High Court as well as the Supreme Court have prominently kept that object in mind.” To safeguard the 'will' of the people enshrined
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in the Constitution-it is necessary to keep the judiciary truly distinct from both the Legislature and Executive. This is what the framers of our Constitution have done.
it is clear that what the Act intended was validation of its action of taking possession of the Kovalam Palace vide Government Order dated 25th September, 2004 by containing a non-obstante clause in Section 3(1). The Act intended to make ineffective the Division Bench judgment of this Court dated 08.04.2005.
“ Entry 32 of List I : 32. Property of the Union and the revenue therefrom, but as regards property situated in a State subject to legislation by the State, save in so far as Parliament by law otherwise
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provides.
Entry 18 of List II: 18. land, that is to say, right in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonization.”
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that the decision could not have been given in the altered circumstances. It is useful to quote paragraph 4 of the judgment. Paragraph 4 reads as under:
“ 4. Before we examine Section 3 to find out whether it is effective in its purpose or not we may say a few words about validating statutes in general. When a Legislature sets out to validate a tax declared by a court to be illegally collected under an ineffective or an invalid law, the cause for ineffectiveness or invalidity must be removed before validation can be said to take place effectively. The most important condition, of course, is that the Legislature must possess the power to impose the tax, for, if it does not, the action must ever remain ineffective and illegal. Granted legislative competence, it is not sufficient to declare merely that the decision of the Court shall not bind for that is tantamount to reversing the decision in exercise of judicial power which the Legislature does not possess or exercise. A court’s decision must always bind unless the conditions on which it is based are so fundamentally altered that the decision could not have been given in the altered circumstances. Ordinarily, a court holds a tax to be invalidly imposed because the power to tax is wanting or the statute or the rules or both are invalid or do not sufficiently create the jurisdiction.
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Validation of a tax so declared illegal may be done only if the grounds of illegality or invalidity are capable of being removed and are in fact removed and the tax thus made legal. Sometimes this is done by providing for jurisdiction where jurisdiction had not been properly invested before. Sometimes this is done by re-enacting retrospectively a valid and legal taxing provision and then by fiction making the tax already collected to stand under the re-enacted law. Sometimes the Legislature gives its own meaning and interpretation of the law under which tax was collected and by legislative fiat makes the new meaning binding upon courts. The Legislature may follow any one method or all of them and while it does so it may neutralise the effect of the earlier decision of the court which becomes ineffective after the change of the law. Whichever method is adopted it must be within the competence of the legislature and legal and adequate to attain the object of validation. If the Legislature has the power over the subjectmatter and competence to make a valid law, it can at any time make such a valid law and make it retrospectively so as to bind even past transactions. The validity of a Validating Law, therefore, depends upon whether the Legislature possesses the competence which it claims over the subject-matter and whether in making the validation it removes the
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defect which the courts had found in the existing law and makes adequate provisions in the Validating Law for a valid imposition of the tax.”
of the Apex Court judgment in The Municipal Corporation of the City of Ahmedabad and another v. The New Shrock Spg. and Wvg. Co. Ltd and others [(1970) 2 SCC 280]. The following was laid down by the Supreme Court in paragraph 7.
“7. This is a strange provision. Prima facie that provision appears to command the Corporation to refuse to refund the amount illegally collected despite the orders of this Court and the High Court. The State of Gujarat was not well advised in introducing this provision. That provision attempts to make a direct inroad into the judicial powers of the State. The legislatures under our Constitution have within the prescribed limits, powers to make laws prospectively as well as retrospectively. By exercise of those powers, the legislature can remove the basis of a decision rendered by a competent Court thereby rendering that decision ineffective. But no legislature in this country has power to ask the instrumentalities of the State to disobey or disregard the decisions
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given by Courts. The limits of the power of legislatures to interfere with the directions issued by Courts were considered by several decisions of this Court. In Shri Prithvi Cotton Mills Ltd. v. Broach Borough Municipality, Civil Appeals Nos. 2197-2198 of 1966, dated 25-4-1969 : (reported in AIR 1970 SC 192) our present Chief Justice speaking for the Constitution Bench of the Court observed:
"Before we examine S.3 to find out whether it is effective in its purpose or not we may say a few words about validating statutes in general. When a legislature sets out to validate a tax declared by a Court to be illegally collected under an ineffective or an invalid law, the cause for ineffectiveness or invalidity must be removed before validation can be said to take place effectively. The most important condition of course, is that the legislature must possess the power to impose the tax, for, if it does not, the action must ever remain ineffective and illegal. Granted legislative competence, it is not sufficient to declare merely that the decision of the court shall not bind for that is tantamount to reversing the decision in exercise of judicial power which the legislature does not possess or exercise. A court's decision must always bind unless the conditions on which it is based are so fundamentally altered that the decision could not have been given in the altered circumstances. Ordinarily, a court holds a tax to be invalidly imposed because the power to tax is wanting or the statutes or the rules or both are
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invalid or do not sufficiently create the jurisdiction. Validation of a tax so declared illegal may be done only if the grounds of illegality or invalidity are capable of being removed and are in fact removed and the tax thus made legal. Sometimes this is done by providing for jurisdiction where jurisdiction had not been properly invested before. Sometimes this is done by reenacting retrospectively a valid and legal taxing provision and then by fiction making the tax already collected to stand under the reenacted law."
28. There cannot be any dispute to the proposition
that it is not permissible for the legislature to encroach upon
the judicial power and although it is entitled to change with retrospective effect the law which form the basis of the judicial decision. It is not permissible for the legislature to declare the judgment of the Court as not binding. One more judgment which is relevant to notice in this context is the Apex Court judgment in the matter of Cauvery Water
Disputes Tribunal (AIR 1992 SC 522) . The Central Government in exercise of its powers under Section 4 of the Inter-State Water Disputes Act, 1956 had constituted a Water Dispute Tribunal namely 'Cauvery Water Disputes
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Tribunal' which passed an interim order on 25.06.1991. To get over the order of the Tribunal, the Governor of Karnataka issued an Ordinance namely 'Karnataka Cauvery Basin Irrigation Protection Ordinance, 1991'. The Ordinance gave an overriding effect to the provisions notwithstanding anything contained in a decision of any Court or Tribunal. The reference was made by the President of India under Article 143 of the Constitution to the Supreme Court referring three questions for decision of the Supreme Court. The Apex Court in the said judgment had held that the Ordinance has been issued to defy and nullify the interim order passed by the Tribunal. Following was observed in paragraph 61 of the judgment:
“ 61. The object of these provisions of the Ordinance is obvious. Coming close on the order dated June 25, 1991 of the Tribunal and in the context of the stand taken by the State of Karnataka that the Tribunal has no power or jurisdiction to pass any interim order or grant any interim relief, it is to override the said decision of the Tribunal and its implementation. The Ordinance has thus the effect of
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defying and nullifying any interim order of the Tribunal appointed under a law of the Parliament. This position is not disputed before us on behalf of the State of Karnataka. The other effect of the Ordinance is to reserve to the State of Karnataka exclusively the right to appropriate as much of the water of river Cauvery and its tributaries as it deems requisite and in a manner and at periods it deems fit and proper, although pending the final adjudication by the Tribunal.”
“ 73. The Ordinance is unconstitutional because it affects the jurisdiction of the Tribunal appointed under the Central Act, viz., the Inter-State Water Disputes Act which legislation has been made under Article 262 of the Constitution. As has been pointed out above, while analysing the provisions of the Ordinance, its obvious purpose is to nullify the effect of the interim order passed by the Tribunal on June 25, 1991. The Ordinance makes no secret of the said
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fact and the written statement filed and the submissions made on behalf of the State of Karnataka show that since according to the State of Karnataka the Tribunal has no power to pass any interim order or grant any interim relief as it has done by the order of June 25, 1991, the order is without jurisdiction and, therefore, void ab initio. This being so, it is not a decision, according to Karnataka, within the meaning of Section 6 and not binding on it and in order to protect itself against the possible effects of the said order, the Ordinance has been issued. The State of Karnataka has thus arrogated to itself the power to decide unilaterally whether the Tribunal has jurisdiction to pass the interim order or not and whether the order is binding on it or not. Secondly, the State has also presumed that till a final order is passed by the Tribunal, the State has the power to appropriate the waters of the river Cauvery to itself unmindful of and unconcerned with the consequences of such action on the lower riparian States. Karnataka has thus presumed that it has superior rights over the said waters and it can deal with them in any manner. In the process, the State of Karnataka has also presumed that the lower riparian States have no equitable rights and it is the sole judge as to the share of the other riparian States in the said waters. What is further, the State of Karnataka has assumed the role
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of a judge in its own cause. Thus, apart from the fact that the Ordinance directly nullifies the decision of the Tribunal dated June 25, 1991, it also challenges the decision dated April 26, 1991 of this Court which has ruled that the Tribunal had power to consider the question of granting interim relief since it was specifically referred to it. The Ordinance further has an extra-territorial operation inasmuch as it interferes with the equitable rights of Tamil Nadu and Pondicherry to the waters of the Cauvery river. To the extent that the Ordinance interferes with the decision of this Court and of the Tribunal appointed under the Central legislation, it is clearly unconstitutional being not only in direct conflict with the provisions of Article 262 of the Constitution under which the said enactment is made but being also in conflict with the judicial power of the State.
74. In this connection, we may refer to a decision of this Court in Municipal Corporation of the City of Ahmedabad v. New Shrock Spg. & Wvg. Co. Ltd. The facts in this case were that the High Court as well as this Court had held that property tax collected for certain years by the Ahmedabad Municipal Corporation was illegal. In order to nullify the effect of the decision, the State Government introduced Section 152-A by amendment to the Bombay Provincial Municipal Corporation Act, the effect of
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which was to command the Municipal Corporation, to refuse to refund the amount illegally collected despite the orders of this Court and the High Court. This Court held that the said provision makes a direct inroad into the judicial powers of the State. The legislatures under the Constitution have, within the prescribed limits, power to make laws prospectively as well as retrospectively. By exercise of those powers a legislature can remove the basis of a decision rendered by a competent court thereby rendering the decision ineffective. But no legislature in the country has power to ask the instrumentalities of the State to disobey or disregard the decisions given by the courts. Consequently, the provisions of sub-section (3) of Section 152-A were held repugnant to the Constitution and were struck down. To the same effect is another decision of this Court in Madan Mohan Pathak v. Union of India. In this case a settlement arrived at between the Life Insurance Corporation and its employees had become the basis of a decision of the High Court of Calcutta. This settlement was sought to be scuttled by the Corporation on the ground that they had received instructions from the Central Government that no payment of bonus should be made by the Corporation to its employees without getting the same cleared by the Government. The employees, therefore, moved the High Court, and the High Court allowed the
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petition. Against that, a letters patent appeal was filed and while it was pending, the Parliament passed the Life Insurance Corporation (Modification of Settlement) Act, 1976 the effect of which was to deprive the employees of bonus payable to them in accordance with the terms of the settlement and the decision of the Single Judge of the High Court. On this amendment of the Act, the Corporation withdrew its appeal and refused to pay the bonus. The employees having approached this Court challenging the constitutional validity of the said legislation, the Court held that it would be unfair to adopt legislative procedure to undo a settlement which had become the basis of a decision of the High Court. Even if legislation can remove the basis of a decision, it has to do it by alteration of general rights of a class but not by simply excluding the specific settlement which had been held to be valid and enforceable by a High Court. The object of the Act was in effect to take away the force of the judgment of the High Court. The rights under the judgment would be said to arise independently of Article 19 of the Constitution.”
laid down that any executive order or legislative enactment which interfere with the adjudicatory process, the adjudication by such Tribunal, is an interference with the judicial power of
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the State. Following was laid down in paragraph 77 of the judgment :
“ 77. The effect of the provisions of Section 11 of the present Act, viz., the Inter-State Water Disputes Act read with Article 262 of the Constitution is that the entire judicial power of the State and, therefore, of the courts including that of the Supreme Court to adjudicate upon original dispute or complaint with respect to the use, distribution or control of the water of, or in any inter-State river or river valleys has been vested in the Tribunal appointed under Section 4 of the said Act. It is, therefore, not possible to accept the submission that the question of grant of interim relief falls outside the purview of the said provisions and can be agitated under Article 131 of the Constitution. Hence any executive order or a legislative enactment of a State which interferes with the adjudicatory process and adjudication by such Tribunal is an interference with the judicial power of the State. In view of the fact that the Ordinance in question seeks directly to nullify the order of the Tribunal passed on June 25, 1991 it impinges upon the judicial power of the State and is, therefore, ultra vires the Constitution.”
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well recognised. But it has been laid down that the legislature has no power to override a judgment. It can only revoke the basis of judgment to make the judgment ineffective. We thus have to see as to whether the Resumption 2005 Act has removed the basis of the judgment or it has directly overridden the Division Bench judgment of this Court. As noted above, the Act has retrospective effect by virtue of Section1(2) which deems to have come into force on 25th day of September, 2004. Section 3 is a provision containing a non-obstante clause providing that “notwithstanding anything contained in any other law for the time being in force or in any judgment, or decree or order of any Court ....”. Section 14 is a validation clause. The basis of Division Bench judgment dated 08.04.2005 of this Court as noted above, was that the State cannot, by an executive fiat, takeover the property. It was held by the Division Bench that the petitioners can takeover the property only through a process known to law. The Division Bench, further in paragraph, 15 has observed that this judgment, however,
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would not stand in the way of the State of Kerala to proceed with a known process of law in respect of which we express no opinion. The Resumption Act 2005 thus purported to revoke the basis of judgment dated 08.04.2005 and does not directly overrule the judgment. In view of the law laid down by the Apex Court as noted above, it was within the competence of the State Legislature to remove the basis of the judgment. The judgment thus cannot be read as encroaching the judicial decision, i.e. the Division Bench judgment dated 08.04.2005.
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of equality enshrined under Article 14 of the
Constitution. By encroaching into the judicial domain and purporting to perform an exclusive judicial function, the 2005 Act violates the principles of rule of law and separation of power. Whether the Act violates Article 14 of the Constitution is a separate issue framed above which shall be considered hereinafter. We proceed to examine the judgments of the Apex Court relied on by the learned counsel for the petitioners only to examine as to whether the Act violates the doctrine of separation of power.
and others v. Mahboob Begum and others (AIR
1953 SC 91). In the above case Writ Petition was filed in the High Court of Judicature at Hyderabad challenging the Act known as Waliuddowla Succession Act of 1950. Object of the Act was to put an end to the dispute that
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existed regarding succession of personal estate of Nawab Waliuddowla and dismissed the claim of succession put forward by the alleged two wives of late Nawab Waliuddowla. Those two ladies and their children filed Writ Petition challenging the validity of the Act on the ground that it conflicted with the petitioner's fundamental right guaranteed under Articles 14, 19(1)(f) and 31(1) of the Constitution of India. High Court had struck down the Act against which appeal was filed in the Supreme Court. The Apex Court in paragraph 10 of the judgment observed that no valid legislation could be passed which is discriminatory in its character and offends against the equal protection clause embodied in Art.14 of the Constitution. In paragraph 13, the Apex Court had observed that legislation has discriminated against from the rest of the community and apparently hostile and discriminatory legislation. In paragraph 14, the
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Apex Court concluded that the Act clearly comes within the Constitutional inhibition of Article 14. The
following was laid in paragraphs 13, 14 and 15:
“13. In the case before us what the legislature has done is to single out two groups of persons consisting of two ladies and their respective children out of those who claim to be related to the late Nawab Waliuddowla and prevent them from getting any share in the personal property of the latter to which they might be entitled under the general law of the land. They claim to be wives and children of the deceased and as such entitled to have shares in his personal estate and no competent court of law has as yet negatived their claims in this respect. On what principle then, it may be asked, was the disability imposed upon these persons alone while the claim of the other claimants was accepted?Nay, the legislation goes further than this and denies to these specified individuals a right to enforce their claim in a court of law, in accordance with the personal law that governs the community to which they belong. They, in fact, have been discriminated against from the rest of the community in respect of a valuable right which the law secures to them all and the question is, on what basis this apparently hostile and discriminatory legislation can be supported?
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14. It is not suggested that it was for serving a public purpose or securing some advantage to the community as a whole that the legislature chose in this case to interfere with private rights. The only purpose of the legislation, as appears from the preamble, was to end certain private disputes. It is true that the quarrel between the two rival parties regarding succession to the estate of the deceased Nawab was going on since 1938; and after several vicissitudes, for which the Nizam himself or his Legal Advisers were primarily responsible, there was a report prepared by the Legal Adviser to the State in a particular way, which contrary to the opinion given by an earlier Special Commission, negatived the claims of these two ladies and their children. It is also true that because of the introduction of the Constitution it was no longer possible for the Nizam to issue a Firman embodying this report. That may be the reason for passing this legislation but it would not furnish any rational basis for the discriminations that it made. The continuance of a dispute even for a long period of time between two sets of rival claimants to the property of a private person is not a circumstance of such unusual nature as would invest a case with special or exceptional features and make it a class by itself justifying its differentiation from all other cases of succession disputes. As appears from the preamble
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to the Act, the only ground for depriving the two ladies and their children of the benefits of the ordinary law is the fact that there was an adverse report against them made by the State Legal Adviser. This ground is itself arbitrary and unreasonable. The dispute regarding succession to the estate of the Nawab was a legal dispute pure and simple and without determination of the points in issue by a properly constituted judicial tribunal a legislation based upon the report of a non-judicial authority and made applicable to specific individuals, who are deprived thereby of valuable rights which are enjoyed by all other persons occupying the same position as themselves, does, in our opinion, plainly come within the constitutional inhibition of Article 14.”
In paragraph 15 also, the Apex Court clearly held that the enactment violated the equal protection clause. The following was laid down in paragraph 15:
“15. The analogy of Private Acts of the British Parliament, to which reference was made by the learned Attorney-General in the course of his arguments, is not at all helpful. The British Parliament enjoys legislative omnipotence and there are no constitutional limitations upon its authority or power.
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There were indeed a few statutes passed by the Provincial Legislature in India during British days which regulated succession to the estates of certain princely families. The Bijni Succession Act (Act II of 1931) passed by the Assam Legislature is an enactment of this type and it did shut out the rights of certain persons who claimed the Bijni estate under the Law of Inheritance. But at that time the Governor General of India had express authority under the provisions of the Government of India Act, 1915, to authorize the Provincial Legislatures to make laws regarding subjects of a private nature. Quite apart from this, no question of infraction of the equal protection rule could arise in pre-Constitution days. We are not unmindful of the fact that the presumption is in favour of the constitutionality of an enactment; but when on the face at it a piece of legislation is palpably unreasonable and discriminatory and the selection or classification made by it cannot be justified on any conceivable or rational ground, the court has got to invalidate the enactment on the ground of its violating the equal protection clause.”
The above case clearly held the enactment as violative of Article 14 of the Constitution. It is true that the Apex Court observed in paragraph 14 that the dispute
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regarding succession to the Estate of Nawab was a legal dispute pure and simple and without determination of the points in issue by a properly constituted judicial tribunal a legislation based on the report of a nonjudicial authority , plainly come within the constitutional inhibition of Article 14. The Apex Court in the said case had not adverted to any violation of the doctrine of separation of power nor any such ratio has been laid down that the Act violated the doctrine of separation of power and the Act as noted above was held to be invalid on account of violation of Art.14 of the Constitution.
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Bihar Sathi Lands (Restoration) Act, 1950. It was enacted to restore the lands settled with the petitioner with the Bettiah Estate. The Act contained a nonobstante clause. The High Court dismissed the Writ Petition against which the matter was taken to the Supreme Court. Facts of the case and provisions of the Act have been noted in paragraph 9 of the judgment which is to the following effect:
“9. To appreciate the points in controversy between the parties to the proceeding, it may be necessary to narrate the material facts briefly. Maharani Janki Koer, respondent 2 in the appeal, is the present proprietress of an extensive estate in Bihar known by the name of Bettiah Raj, which is held and managed on her behalf by the Court of Wards, Bihar, constituted under Bengal Act 9 of 1879. On 19-7-1946 the appellants, who are two brothers and are distantly related to the Maharani, made a representation to the Government of Bihar through the Manager of the Estate, praying for settlement in raiyati right, of 200 bighas of land preferably in Sathi farm or Materia farm along with a cerrtain quantity of waste lands On 20-7-1946 the then Manager of the
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Wards Estate wrote a letter to the Collector of Champaran recommending that the applicants might he given settlement of the lands as prayed for, without payment of any selami. The collector, however, did not agree to this proposal, nor did the commissioner of the Tirhut Division, and the matter then came up for consideration before the Board of Revenue which recommended that settlement might be made with the applicants provided they were agreeable to pay selami at half the usual rates. On 14-10-1946 the recommendation of the Revenue Board was accepted by the Provincial Government and six days later the Court of Wards accepted a cheque for Rs. 5000 from one if the lessees, towards payment of the selami money and rent for the year 1354 F. S. On 2-11-1946, possession of the lands was given to the appellants and on 18th of November, following the Manager of the Court of Wards recorded a formal order fixing the selami of the land at Rs. 3,988 annas odd and rent at Rs. 797 annas odd per year. On the same day, a Hisab Bandobasti form, which is the usual form employed in the Estate for raiyati settlements, was signed by the Circle Officer on behalf of the court of Wards and by one of the lessees for himself as well as the constituted Attorney of the other lessees. It is not disputed that the lessees continued to possess the
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lands since then on payment of the stipulated rent.”
Before the Apex Court the Act was challenged on the ground that it violated Art.14. It was held that the legislation has singled out two individuals and one solitary transaction which was discriminatory. It is useful to quote paragraphs 14 and 15 of the judgment which are to the following effect:
“14. Mr. P. R. Das, who appeared in support of the appeal, put forward at the forefront of his arguments, the contention raised on behalf of his client in the Court below that the impugned legislation was void by reason of its violating the fundamental rights of the appellants under Art. 14 of the Constitution. The point appeared to us to be of substance and after hearing the learned AttorneyGeneral on this point we were satisfied that the contention of Mr. Das was well-founded and entitled to prevail, irrespective of any other ground that might be raised in this appeal
15. There have been a number of decisions by this Court where the question regarding the nature and scope of the guarantee implied in the equal protection clause of the Constitution came up for consideration and the general principles can be
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taken to be fairly well settled.What this clause aims at is to strike down hostile discrimination or oppression of inequality. As the guarantee applies to all persons similarly situated, it is certainly open to the Legislature to classify persons and things to achieve particular legislative objects; but such selection or differentiation must not be arbitrary and should rest upon a national basis, having regard to the object which the Legislature has in view. It cannot be disputed that the legislation in the present case has singled out two individuals and one solitary transaction entered into between them and another private party, namely, the Bettiah Wards Estates and has declared the transaction to be a nullity on the ground that it is contrary to the provisions of law, although there has been no adjudication on this point by any judicial tribunal. It is not necessary for our present purpose to embark upon a discussion as to how far the doctrine of 'separation of powers' has been recognised in our Constitution and whether the Legislature can arrogate to itself the powers of the judiciary and proceed to decide disputes between private parties by making a declaration of the rights of one against the other. It is also unnecessary to attempt to specify the limits within which any legislation, dealing with private rights, is possible within the purview of our Constitution. On one point
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our Constitution is clear and explicit, namely, that no law is valid which takes away or abridges the fundamental rights guaranteed under Part III of the Constitution. There can be no question, therefore, that if the legislation in the present case comes within the mischief of Art. 14 of the Constitution, it has got to be declared invalid. This leads us to the question as to whether the impugned enactment is, in fact, discriminatory and if so, whether the discrimination made by it can be justified on any principle of reasonable classification?”.
Again in paragraph 18 of the judgment the Apex Court held that there is no valid classification in the Statute and the case is fully covered by the principles enunciated in Ameerunnissa Begum and others v. Mahboob Begum and others (supra). It is useful to quote paragraph 18 which is to the following effect:
18. Be that as it may, there is no doubt that the appellants were not the only lessees under the Bettiah Estate who got settlement of lands at a selami of five years' rental. On the sworn statements of the appellants, which are not challenged by the
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other side, it appears that there are numerous persons occupying the same position as the appellants, who however were not subjected to this expropriator legislation. But the vice in this legislation goes much deeper than this. It is not merely a question of treating the appellants differently from the other lessees under the Wards Estate, with whom settlements of land have been made on similar or identical terms. If a lease has been given by a Court of Wards, which is not for the benefit of the Estate or advantage of the ward, it is for a Court of law to decide whether it is warranted by the terms of the Court of Wards Act. If the lessor proceeds to cancel the lease, the lessee has a legal right to defend his claim and satisfy the Court that the lease is not in contravention of law. If, on the other hand, the lessee is actually dispossessed, he has a right to sue in court for recovery of possession of the property on establishing that he has been illegally turned out. The dispute here, is a legal dispute pure and simple between two private parties.What the legislature has done is to single out these two individuals and deny them the right which every Indian citizen possesses to have his rights adjudicated upon by a judicial tribunal in accordance with the law which applies to his case. The meanest of citizens has a right of access to a Court of law for
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the redress of his just grievances and it is from this right that the appellants have been deprived, by this Act. It is impossible to conceive of a worse form of discrimination than the one which differentiates a particular individual from all his fellow subjects and visits him with a disability which is not imposed upon anybody else and against which even the right of complaint is taken away. The learned AttorneyGeneral, who placed his case with his usual fairness and ability, could not put forward any convincing or satisfactory reason upon which this legislation could be justified.It is true that the presumption is in favour of the constitutionality of a legislative enactment and it has to be presumed that a Legislature understands and correctly appreciates the needs of its own people. But when on the face of a statute there is no classification at all, and no attempt has been made to select any individual or group with reference to any differentiating attribute peculiar to that individual or group and not possessed by others, this presumption is of little or no assistance to the State.We may repeat with profit what was said by Brewer J. in Gulf Colorado etc. Co. v. Ellis,. (1897) 165 U.S. 150 (C) that
"to carry the presumption to the extent of holding that there must be some undisclosed and unknown reason for subjecting certain individuals or corporations to hostile an discriminatory
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legislation is to make the protection clauses of the Fourteenth Amendment a mere rope of sand."
In our opinion, the present case comes directly within the principle enunciated by this Court in AIR 1953 SC 91 (B)”.
It is relevant to note that the Apex Court in the said judgment observed that it is not necessary for the purpose of the case to embark upon the discussion as to how far the doctrine of separation of power has been recognised in our Constitution. The following observation bas been made in paragraph 15:
“It is not necessary for our present purpose to embark upon a discussion as to how far the doctrine of 'separation of powers' has been recognised in our Constitution and whether the Legislature can arrogate to itself the powers of the judiciary and proceed to decide disputes between private parties by making a declaration of the rights of one against the other”.
of Tamil Nadu v. State of Kerala (AIR 2014 SC
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considered the doctrine of separation of power. The said case related to the Mullaperiyar Dam. The Constitutional validity of the 2006 amendment in Kerala Irrigation and Water Conservation Act (2003) fell for consideration in the said case. Several Writ Petitions were filed in the Kerala High Court as well as in the Madras High Court regarding raising of water level in the Mullaperiyar reservoir beyond 136 feet. One Writ Petition under Art.32 was filed before the Supreme Court by the Mullaperiyar Environmental Protection Forum. The Apex Court transferred the Writ Petitions which were pending before the Kerala and Madras High Court and gave a decision 26.02.2014 permitting the water level in the Muallaperiyar Dam to be raised upto 142 feet. The State of Kerala and its Officers were restrained from causing any obstruction to the above. It was also observed that after the strengthening work was complete to the satisfaction of the CWC, experts would
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examine the safety level before the water level is raised to 142 feet. Within three weeks of the judgment of the Apex Court, the State Legislature amended the 2003 Act by the Kerala Irrigation and Water Conservation (Amendment) Act, 2006. The State of Tamil Nadu thereafter instituted a suit under Article 131 of the Constitution before the Supreme Court against the State of Kerala. In the above context the Apex Court considered the doctrine of separation of power. In paragraph 93 the following was laid down:
“93. Indian Constitution, unlike Constitution of United States of America and Australia, does not have express provision of separation of powers. However, the structure provided in our Constitution leaves no manner of doubt that the doctrine of separation of powers runs through the Indian Constitution. It is for this reason that this Court has recognized separation of power as a basic feature of the Constitution and an essential constituent of the rule of law. The doctrine of separation of powers is, though, not expressly engrafted in the Constitution, its sweep, operation and visibility are apparent/from
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the Constitution. Indian Constitution has made demarcation without drawing formal lines between the three organs – legislature, executive and judiciary”.
Judgment of the Apex Court in Shri Prithvi Cotton Mills Ltd. & Another v. Broach Borough Municipality & Others (AIR 1970 SC 192) was quoted with approval in paragraph 95 which is quoted as below:
“95. One of the leading cases of this Court on the legislative competence vis-à-vis decision of the Court is Prithvi Cotton11. In that case, the validity of the Gujarat Imposition of Taxes by Municipalities (Validation) Act,1963 was assailed on behalf of the petitioners. The Validation Act had to been acted in view of the decision of this Court in Patel GordhandasHargovindas37. Section 3 of the Validation Act provided that notwithstanding anything contained in any judgment, decree or order of a court or tribunal or any other authority, no tax assessed or purported to have been assessed by a municipality on the basis of capital value of a building or land and imposed, collected or recovered by the municipality at any time before the
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commencement of the Validation Act shall be deemed to have been invalidly assessed, imposed, collected or recovered and the imposition, collection or recovery of the tax so assessed shall be valid and shall be deemed to have been always valid and shall not be called in question merely on the ground that the assessment of the tax on the basis of capital value of the building or land was not authorized by law and accordingly any tax so assessed before the commencement of the Validation Act and leviable for a period prior to such commencement but not collected or recovered before such commencement may be collected or recovered in accordance with the relevant municipal law. The Constitution Bench exposited that the validity of a validating law depended upon whether the legislature possesses the competence which it claims over the subject matter and whether in making the validation it removed the defect which the courts had found in the existing law and made adequate provisions in the validating law for a valid imposition of the taxes. In the words of the Constitution Bench:
“….When a Legislature sets out to validate a tax declared by a court to be illegally collected under an ineffective or an invalid law, the cause for ineffectiveness or invalidity must be removed before validation can be said to take place effectively. The most important condition, of course, is that the
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Legislature must possess the power to impose the tax, for, if it does not, the action must ever remain ineffective and illegal. Granted legislative competence, it is not sufficient to declare merely that the decision of the Court shall not bind for that is tantamount to reversing the decision in exercise of judicial power which the Legislature does not possess or exercise. A court’s decision must always bind unless the conditions on which it is based are so fundamentally altered that the decision could not have been given in the altered circumstances. Ordinarily, a court holds a tax to be invalidly imposed because the power to tax is wanting or the statute or the rules or both are invalid or do not sufficiently create the jurisdiction. Validation of a tax so declared illegal may be done only if the grounds of illegality or invalidity are capable of being removed and are in fact removed and the tax thus made legal. Sometimes this is done by providing for jurisdiction where jurisdiction had not been properly invested before. Sometimes this is done by re-enacting retrospectively a valid and legal taxing provision and then by fiction making the tax already collected to stand under the re-enacted law. Sometimes the Legislature gives its own meaning and interpretation of the law under which tax was collected and by legislative fiat makes the new meaning binding upon courts. The Legislature may follow any one method or all of them and while it does so it may neutralise the effect of the earlier decision of the court which becomes ineffective after the change of the law. Whichever method is adopted it
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must be within the competence of the legislature and legal and adequate to attain the object of validation. If the Legislature has the power over the subject matter and competence to make a valid law, it can at any time make such a valid law and make it retrospectively so as to bind even past transactions. The validity of a Validating Law, therefore, depends upon whether the Legislature possesses the competence which it claims over the subject-matter and whether in making the validation it removes the defect which the courts had found in the existing law and makes adequate provisions in the Validating Law for a valid imposition of the tax.”
After referring to almost all important earlier judgments of the Supreme court, the summary of principle of doctrine of separation of powers was enunciated in paragraph 121 which is quoted as below:
“121. On deep reflection of the above discussion, in our opinion, the constitutional principles in the context of Indian Constitution relating to separation of powers between legislature, executive and judiciary may, in brief, be summarized thus :
(i) Even without express provision of the separation of powers, the doctrine of separation of powers is an entrenched
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principle in the Constitution of India. The doctrine of separation of powers informs the Indian constitutional structure and it is an essential constituent of rule of law. In other words, the doctrine of separation of power though not expressly engrafted in the Constitution, its sweep, operation and visibility are apparent from the scheme of Indian Constitution. Constitution has made demarcation, without drawing formal lines between the three organs - legislature, executive and judiciary. In that sense, even in the absence of express provision for separation of power,the separation of power between legislature, executive and judiciary is not different from the constitutions of the countries which contain express provision for separation of powers.
(ii) Independence of courts from the executive and legislature is fundamental to the rule of law and one of the basic tenets of Indian Constitution. Separation of judicial power is a significant constitutional principle under the Constitution of India.
(iii) Separation of powers between three organs – legislature, executive and judiciary – is also nothing but a consequence of principles of equality enshrined in Article 14 of the Constitution of India. Accordingly,breach of separation of judicial power may amount to negation of equality under Article 14. Stated thus, a legislation can be invalidated on the basis of breach of the separation of powers since such breach is negation of equality under Article 14 of the Constitution.
(iv) The superior judiciary (High
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Courts and Supreme Court) is empowered by the Constitution to declare a law made by the legislature (Parliament and State legislatures) void if it is found to have transgressed the constitutional limitations or if it infringed the rights enshrined in Part III of the Constitution.
(v) The doctrine of separation of powers applies to the final judgments of the courts. Legislature cannot declare any decision of a court of law to be void or of no effect. It can, however, pass an amending Act to remedy the defects pointed out by a court of law or on coming to know of it aliunde. In other words, a court’s decision must always bind unless the conditions on which it is based are so fundamentally altered that the decision could not have been given in the altered circumstances.
(vi) If the legislature has the power over the subject-matter and competence to make a validating law, it can at any time make such a validating law and make it retrospective. The validity of a validating law,therefore, depends upon whether the legislature possesses the competence which it claims over the subject-matter and whether in making the validation law it removes the defect which the courts had found in the existing law.
(vii) The law enacted by the legislature may apparently seem to be within its competence but yet in substance if it is shown as an attempt to interfere with the judicial process, such law may be invalidated being in breach of doctrine of separation of powers. In such situation, the legal effect of the law on a
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judgment or a judicial proceeding must be examined closely, having regard to legislative prescription or direction. The questions to be asked are,
(i) Does the legislative prescription or legislative direction interfere with the judicial functions? (ii) Is the legislation targeted at the decided case or whether impugned law requires its application to a case already finally decided? (iii) What are the terms of law; the issues with which it deals and the nature of the judgment that has attained finality? If the answer to (i) to (ii) is in the affirmative and the consideration of aspects noted in question (iii) sufficiently establishes that the impugned law interferes with the judicial functions, the Court may declare the law unconstitutional.
The Supreme Court clearly held that the law enacted by the Legislature may apparently seem to be within its competence but yet in substance if it is shown as an attempt to interfere with the judicial process, such law may be invalidated being in breach of doctrine of
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separation of powers. The test to find out as to whether the legislation is in breach of the doctrine of separation of powers, the following was observed in paragraph 121:
(vii) The law enacted by the legislature may apparently seem to be within its competence but yet in substance if it is shown as an attempt to interfere with the judicial process, such law may be invalidated being in breach of doctrine of separation of powers. In such situation, the legal effect of the law on a judgment or a judicial proceeding must be examined closely, having regard to legislative prescription or direction. The questions to be asked are,
(i) Does the legislative prescription or legislative direction interfere with the judicial functions? (ii) Is the legislation targeted at the decided case or whether impugned law requires its application to a case already finally decided? (iii) What are the terms of law; the issues with which it deals and the nature of the judgment that has attained finality? If the answer to (i) to (ii) is in the affirmative and the consideration of aspects noted in question
(iii)sufficiently establishes that the impugned law interferes with the judicial functions, the Court may declare the law unconstitutional.”
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36. After setting out the principles of separation of
power, the Apex Court proceeded to examine the constitutional validity of the 2006 Amendment Act. The Apex Court also referred to its decision in Mullaperiyar Environmental Protection Forum's case and laid down the following in paragraphs 125 and 126 which are to the following effect:
“125. For these reasons, and others contained in the judgment, this Court reached to the firm conclusion that raising the water level from 136 ft. to142 ft. would not jeopardise the safety of the dam in any manner. Consequently, this Court restrained Kerala and its officers from causing any obstruction from carrying out further strengthening measures by Tamil Naduas suggested by CWC and Tamil Nadu was permitted to increase water level of Mullaperiyar dam to 142 ft.
126. The decision of this Court on 27.02.2006 in the Mullaperiyar Environmental Protection Forum case was the result of judicial investigation, founded upon facts ascertained in the course of hearing. It was strictly a judicial question. The claim of the
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State of Kerala was that water level cannot be raised from its present level of 136 ft. On the other hand, Tamil Nadu sought direction for raising the water level to 142 ft. and, after strengthening,to its full level of 152 ft. The obstruction by Kerala to the water level in the Mullaperiyar dam being raised to 142 ft. on the ground of safety was found untenable, and, in its judgment, this Court so pronounced.
The Apex Court after analysing the provisions of the 2006 Amendment Act came to the definite conclusion that the 2006 Amendment Act plainly override the decision of the judgment of the Supreme High Court in Mullaperiyar Environmental Protection Forum's case (supra). The following was laid down in paragraphs 143 and 144.
143. This Court in Mullaperiyar Environmental Protection Forum1, after hearing the State of Kerala, was not persuaded by Kerala’s argument that Mullaperiyar dam was unsafe or storage of water in that dam cannot be increased. Rather, it permitted Tamil Nadu to increase the present water level from 136 ft. to 142 ft. and restrained Kerala from
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interfering in Tamil Nadu’s right in increasing the water level in Mullaperiyar dam to 142 ft. Thus, a judgment has been given by this court in contest between the two States in respect of safety of Mullaperiyar dam for raising water level to 142 ft. The essential element of the judicial function is the decision of a dispute actually arising between the parties and brought before the court. Necessarily, such decision must be binding upon the parties and enforceable according to the decision. A plain and simple judicial decision on fact cannot be altered by a legislative decision by employing doctrines or principles such as ‘public trust doctrine’, ‘precautionary principle’ ‘larger safety principle’ and, ‘competence of the State legislature to override agreements between the two States’. The Constitutional principle that the legislature can render judicial decision ineffective by enacting validating law within its legislative field fundamentally altering or changing its character retrospectively has no application where a judicial decision has been rendered by recording a finding of fact. Under the pretence of power, the legislature, cannot neutralize the effect of the judgment given after ascertainment of fact by means of evidence/materials placed by the parties to the dispute. A decision which disposes of the matter by
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giving findings upon the facts is not open to change by legislature. A final judgment,once rendered, operates and remains in force until altered by the court inappropriate proceedings.
144. 2006 (Amendment) Act plainly seeks to nullify the judgment of this court which is constitutionally impermissible. Moreover, it is not disputed by Kerala that 2006 (Amendment) Act is not a validation enactment. Since the impugned law is not a validating law, it is not required to inquire whether in making the validation the legislature has removed the defect which the Court has found in existing law. The 2006 (Amendment) Act in its application to and effect on Mullaperiyar dam is a legislation other than substantially legislative as it is aimed at nullifying the prior and authoritative decision of this Court. The nub of the infringement consists in Kerala legislator's revising the final judgment of this Court in utter disregard of the constitutional principle that the revision of such final judgment must remain exclusively within the discretion of the court.
There cannot be any dispute to the proposition of law and the principles enunciated by the Apex Court in the above case dealing with the doctrine of separation of
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power. But the Apex Court invalidated the 2006 Amendment Act of the Kerala on the ground that it overreached and nullified the judgment of the Apex Court in Mullaperiyar Environmental Protection Forum's case. As noted above, the 2005 Act is a validating Act and purported to remove the basis of the judgment delivered by this Court on 08.02.2005 in the earlier Writ Petition. It cannot be said to nullify the judgment of the High Court. Hence the decision in State of Tamil Nadu v. State of Kerala (supra) is not applicable to the facts of this case.
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of power, Rule of law and judicial review. Question was also raised as to whether power of judicial review stands breached and the NTT Act, 2005 violates the basic structure of the Constitution. Dealing with the concept of separation of power the following was laid down in paragraph 63(i).
“ 63(i) A perusal of the judgment rendered in Kesavananda Bharati case (supra) reveals that “separation of powers” creates a system of checks and balances, by reasons of which, powers are so distributed, that none of the three organs transgresses into the domain of the other. The concept ensures the dignity of the individual. The power of “judicial review” ensures, that executive functioning confines itself within the framework of law enacted by the legislature. Accordingly, the demarcation of powers between the legislature, the executive and the judiciary, is regarded as the basic element of the constitutional scheme. When the judicial process is prevented by law, from determining whether the action taken, was or was not, within the framework of the legislation enacted, it would amount to the transgression of the adjudicatory/determinatory process by the
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legislature. Therefore, the exclusion of the power of “judicial review”, would strike at the “basic structure” of the Constitution.”
The submission that the Tribunal Act violates the basic structure of the Constitution or take away powers of judicial review was answered by the Apex Court in Paragraph 64 is referred to which is quoted below:
“ 64. The position of law summarized in the foregoing paragraph constitutes a declaration on the concept of the “basic structure”, with reference to the concepts of “separation of powers” the “rule of law”, and “judicial review”. Based on the conclusions summarized above, it will be possible for us to answer the first issue projected before us, namely, whether “judicial review” is a part of the “basic structure” of the Constitution. The answer has inevitably to be in the affirmative. From the above determination, the petitioners would like us to further conclude, that the power of “judicial review” stands breached with the promulgation of the NTT Act. This Court in Minerva Mills Ltd. case (supra) held, that it should not be taken, that an effective alternative institutional mechanism or arrangement for “judicial review” could not be made by Parliament. The same position was reiterated in S.P.
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Sampath Kumar case(supra), namely, that “judicial review” was an integral part of the “basic structure” of the Constitution. All the same it was held, that Parliament was competent to amend the Constitution, and substitute in place of the High Court, another alternative institutional mechanism (court or tribunal). It would be pertinent to mention, that in so concluding, this Court added a forewarning, that the alternative institutional mechanism set up by Parliament through an amendment, had to be no less effective than the High Court itself. In L.Chandra Kumar case (supra), even though this Court held that the power of “judicial review” over legislative action vested in High Courts, was a part of the “basic structure”, it went on to conclude that “ordinarily” the power of High Courts to test the constitutional validity of legislations could never be ousted. All the same it was held, that the powers vested in High Courts to exercise judicial superintendence over decisions of all courts and tribunals within their respective jurisdictions, was also a part of the “basic structure” of the Constitution. The position that Parliament had the power to amend the Constitution, and to create a court/tribunal to discharge functions which the High Court was discharging, was reiterated, in Union of India v. Madras Bar Association case (supra). It was
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concluded, that the Parliament was competent to enact a law, transferring the jurisdiction exercised by High Courts, in regard to any specified subject, that parliament could not transfer power vested in the High Courts, by the Constitution itself. We therefore have no hesitation in concluding, that appellate powers vested in the High Court under different statutory provisions, can definitely be transferred from the High Court to other courts/tribunals, subject to the satisfaction of norms declared by this Court. Herein the jurisdiction transferred by the NTT Act was with regard to specified subjects under tax related statutes. That, in our opinion, would be permissible in terms of the position expressed above. Has the NTT Act transferred any power vested in courts by the Constitution ? The answer is in the negative. The power of “judicial review” vested in the High Court under Articles 226 and 227 of the Constitution, has remained intact. This aspect of the matter, has a substantial bearing, to the issue in hand. And will also lead to some important inferences. Therefore, it must never be overlooked, that since the power of “judicial review” exercised by the High Court under Articles 226 and 227 of the Constitution has remained unaltered, the power vested in High Courts to exercise judicial superintendence over the benches of the NTT within
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their respective jurisdiction, has been consciously preserved. This position was confirmed by the learned Attorney General for India, during the course of hearing. Since the above jurisdiction of the High Court has not been ousted, the NTT will be deemed to be discharging a supplemental role, rather than a substitutional role. In the above view of the matter, the submission that the NTT Act violates the “basic structure” of the Constitution, cannot be acquiesced to.”
The Apex Court held that Sections 6, 7 and 8 of NTT Act to be illegal and unconstitutional and considered in paragraphs 90 and 91(i) which is quoted below:
“90. Sections 5, 6, 7, 8 and 13 of the NTT Act have been held by us (to the extent indicated hereinabove) to be illegal and unconstitutional on the basis of the parameters laid down by decisions of constitutional benches of this Court and on the basis of recognised constitutional conventions referable to constitutions framed on Westminster model. In the absence of the aforesaid provisions which have been held to be unconstitutional, the remaining provisions have been rendered otiose and worthless, and as such, the provisions of the NTT Act, as a whole, are hereby set aside.
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91(i) The Parliament has the power to enact legislation, and to vest adjudicatory functions, earlier vested in the High Court, with an alternative court/tribunal. Exercise of such power by the Parliament would not per se violate the “basic structure” of the Constitution.”
xxx xxx xxx xxx xxx
Justice R.F. Nariman delivering a concurring opinion, in paragraph 92(1) the following was held.
“92(1). In these cases, essentially four contentions have been urged on behalf of the petitioners. The first contention is that the reason for setting up a National Tax Tribunal is non-existent as uniformity of decisions pertaining to tax laws is hardly a reason for interposing another tribunal between an appellate Tribunal and the Supreme Court, as High Court decisions are more or less uniform, since they follow the law laid down by each other. Since this is so, the Act must be struck down. The second contention is that it is impermissible for the legislature to divest superior courts of record from the core judicial function of deciding substantial questions of law. The third contention is as regards the Constitutional validity of Article 323B being violative of the separation of powers doctrine, the rule of law doctrine and judicial review. The
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fourth contention concerns itself with the nitty gritty of the Act, namely, that various sections undermine the independence of the adjudicatory process and cannot stand judicial scrutiny in their present form. Since I am accepting the second contention urged by the petitioners, this judgment will not deal with any of the other contentions.”
After examining the provisions of the Act and several judgments of the Apex Court, US Supreme Court and Privy Council, referring to the judgment of the Supreme Court, in L.Chandrakumar's case the following was laid down in paragraphs 130(39) and 132(41).
“130(39). On reading the above argument, it is clear that even according to this argument, the High Court's power of judicial review under Article 226/227 has in fact been supplemented by the National Tax Tribunal, something which L.Chandrakumar said cannot be done. See para 93 of L.Chandrakumar's case quoted above. In State of West Bengal v. Committee for Protection of Democratic Rights , 2010 (3) SCC 571) a Constitution Bench of this Court held:
“39. It is trite that in the Constitutional Scheme adopted in India, besides supremacy of the Constitution,
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the separation of powers between the legislature, the executive and the judiciary constitutes the basic features of the Constitution. In fact, the importance of separation of powers in our system of governance was recognised in Special Reference No. 1 (supra), even before the basic structure doctrine came to be propounded in the celebrated case of His Holiness Kesavananda Bharati Sripadagalvaru v. State of Kerala and Another, 1973 KHC 800, wherein while finding certain basic features of the Constitution, it was opined that separation of powers is part of the basic structure of the Constitution. Later, similar view was echoed in Smt. Indira Nehru Gandhi v. Shri Raj Narain and Another, 1975 KHC 452 and in a series of other cases on the point. Nevertheless, apart from the fact that our Constitution does not envisage a rigid and strict separation of powers between the said three organs of the State, the power of judicial review stands entirely on a different pedestal. Being itself part of the basic structure of the Constitution, it cannot be ousted or abridged by even a Constitutional amendment. [See -- L.Chandra Kumar v. Union of India and Others (supra)]. Besides, judicial review is otherwise essential for resolving the disputes regarding the limits of Constitutional power and entering the Constitutional limitations as an ultimate interpreter of the Constitution.
“68. Thus, having examined the rival contentions in the context of the Constitutional Scheme, we conclude as follows:
(iii) In view of the constitutional
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scheme and the jurisdiction conferred on this Court under Art.32 and on the High Courts under Art.226 of the Constitution the power of judicial review being an integral part of the basic structure of the Constitution, no Act of Parliament can exclude or curtail the powers of the Constitutional Courts with regard to the enforcement of fundamental rights. As a matter of fact, such a power is essential to give practicable content to the objectives of the Constitution embodied in Part III and other parts of the Constitution. Moreover, in a federal constitution, the distribution of legislative powers between the Parliament and the State Legislature involves limitation on legislative powers and, therefore, this requires an authority other than the Parliament to ascertain whether such limitations are transgressed. Judicial review acts as the final arbiter not only to give effect to the distribution of legislative powers between the Parliament and the State Legislatures, it is also necessary to show any transgression by each entity. Therefore, to borrow the words of Lord Steyn, judicial review is justified by combination of 'the principles of separation of powers, rule of law, the principle of constitutionality and the reach of judicial review'.”
In the above judgment the Apex Court held the provisions of the NTT Act unconstitutional holding that
the Act is unconstitutional being an encroachment on
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the exclusive domain of the superior courts of records in India. It was held that the basic structure of Constitution will stand violated while enacting the legislation pertaining to transfer of judicial power, the Parliament does not ensure that the newly created Court/Tribunal conforms with the core judicial functions of the High Court which is going to become a substitute. The conclusions recorded by the Apex Court have already been quoted above. There cannot be any dispute to the proposition laid down by the Supreme Court in the said judgment. However, the ratio of the judgment and proposition laid down by the Supreme Court have no application to the facts of the present case. But in view of the forgoing discussion we are of the clear opinion that the 2005 Act does not encroach into the judicial domain violating the doctrine of separation of power. However, as noted above question as to whether the Act violates Art.14 of the Constitution is to be separately
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considered.
ISSUE NO.II
Coking Coal Ltd., (1983) 1 SCC 147) where the following was laid down in paragraph 25:
“25. Shri Ashok Sen drew pointed attention to the earlier affidavits filed on behalf of Bharat Coking Coal Company and commented severally on the alleged contradictory reasons given therein for the exclusion of certain coke oven plants from the Coking Coal Mines (Nationalisation) Act. But, in the
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ultimate analysis, we are not really to concern ourselves with the hollowness or the self condemnatory nature of the statements made in the affidavits filed by the respondents to justify and sustain the legislation. The deponents of the affidavits filed into Court may speak for the parties on whose behalf they swear to the statements. They do not speak for the Parliament. No one may speak for the Parliament and Parliament is never before the Court. After Parliament has said what it intends to say, only the Court may say what the Parliament meant to say. None else. Once a statute, leaves Parliament House, the Court's is the only authentic voice which may echo (interpret) the Parliament. This the Court will do with reference to the language of the statute and other permissible aids. The executive Government may place before the Court their understanding of what Parliament has said or intended to say or what they think was Parliament's object and all the facts and circumstances which in their view led to the legislation. When they do so, they do not speak for Parliament. No Act of Parliament may be struck down because of the understanding or misunderstanding of Parliamentary intention by the executive government or because their (the Government's) spokesmen do not bring out relevant circumstances but indulge in empty and
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self defeating affidavits. They do not and they cannot bind Parliament. Validity of legislation is not to be judged merely by affidavits filed on behalf of the State, but by all the relevant circumstances which the Court may ultimately find and more especially by what may be gathered from what the legislature has itself said. We have mentioned the facts as found by us and we do not think that there has been any infringement of the right guaranteed by Art.14.”
The Apex Court has held that while examining the constitutional validity of an Act, the court is not to confine its consideration only on the basis of the affidavits of the parties. There is always a presumption about the validity of a statute and for declaring a statute invalid all aspects including the constitutional aspects have to be looked into by the court. We thus proceed to examine the constitutional validity of the Act under Art.14 of the Constitution of India.
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arbitrary and discriminatory. It has been pleaded that the State enacted a discriminatory Act to take over the Kovalam Palace on the supposed ground that it is a historic site. It is pleaded that there are 3269 properties which are listed in the heritage properties of the State including several palaces, but the Government did not take possession of any of the listed monuments. It is to be noted that the Kovalam Palace was acquired by the State in the year 1962 for running a hotel business and it was handed over to the Kerala Tourism Development Corporation which actually carried a hotel business till it was handed over to the Union of India. The compensation for acquisition of the property was given to Shri M.T. Rama Varma and all rights of the owner and his heirs extinguished.
“59. The Kovalam Palace is neither a “historic
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site” nor a place of “tourist attraction”. It is not a “heritage site” as well. The history of the buildings in the 4.13.30 hectares land in question would prove that it is not a historic site or heritage site. The site has no historical significance. From 1930 when the building was constructed until 1964 when the Government of Kerala acquired the said land with its buildings including Halcyon Castle, the said buildings have been in the possession and occupation of private individuals (Bishop of Quilon and Makayram Thirunal Valiyakoil Thampuran) was being used by them for their personal residential purpose. After the Government of Kerala acquired the said land and building, the Government did not declare it as a historic site or a place of tourist attraction or heritage site. The acquisition made by the Government under the Land Acquisition Act was not for the public purpose of maintaining it as a historic site or place of tourist attraction or heritage site. Instead, the Government of Kerala put the Halcycon Castle (Kovalam Palace building) and appurtenant land into commercial use by handing it over to KTDC to run the business venture of a hotel by name “Kovalam Palace Hotel” and rented out the rooms in the said building to the general public for stay in the hotel. Thus from 1964 to 1970 during which period the Government of Kerala was its owner and
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possession through KTDC, a Government of Kerala Corporation, the Government of Kerala was using the building and its facilities for commercial purpose for a profit. After 1970 when the title and possession of this buildings and land were transferred, ITDC also treated it as part of its hotel and letting out the rooms in the building to the public for a profit. Therefore, factually as well as legally the State Government is estopped from stating that the Kovalam Palace is a historic or heritage site. In these circumstances Kovalam Palace is not a “historic site” or place of tourist attraction or “heritage site”.
60. The Government of Kerala has prepared a list of heritage properties in the State including several palaces and they are notified as protected monuments. The list contains 3269 properties and all of them are notified as protected monuments. The Government of Kerala has not taken possession of any of the said listed protected monuments and they are allowed to be in the possession of the respective private owners/possessors. Kovalam Palace is not one amongst the properties notified as protected or heritage monument or property. There are several palaces of historical importance and several heritage sites included in the said list. There is no law or procedure to take over them and the Government of Kerala has not taken possession of
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any one of them. Therefore, the take over of the Kovalam Palace is arbitrary and discriminatory. A true copy of the list of protected monuments notified by the Government of Kerala is produced as Ext.P37
61. In Kerala, there is an Act called Kerala Pracheena Samaraka Puravasthu Sanketha Puravishta Act, 1968. Clause 2(a) thereof defines ancient monument. To come within the scope of this Act, a monument shall be not less than 100 years old. Therefore Kovalam Place is not a heritage property or ancient monument under this Act also. Undisputedly Kovalam Palace does not come within the purview of this Act. No act or proceedings have ever been taken under this Act or under any other law against the Kovalam Palace notifying or declaring it as a historic or heritage site or tourist spot.”
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and thereafter decided to take possession of the property vide Government Orders dated 18.09.2004 and 25.09.2004.
“Government of India Ministry of Tourism & Civil Aviation Department of Tourism
Parliament Bhavan, Parliament Street, New Delhi No.7.TPL.II(7)/66 26.3.1970
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To
The Special Secretary, (Public Department) Government of Kerala, Trivandrum.
Subject - Integrated Development of Kovalam Acquisition of the Palace property and land along the beach of Kovalam.
Sir,
1. I am directed to refer to the correspondence resting with your letter No.92732-A3/69-3/P & M dated the 29th November, 1969, on the subject mentioned above and to convey the sanction of the President to the payment of a sum of Rs.9,50,534.39 (Rupees nine lakhs fifty thousand five hundred and thirty four and thirty nine paise) only to the Government of Kerala on account of the transfer of the Palace Propert6y and land along with the beach at Kovalam the cover area measuring about 43 acres acquired by the State Government for the Kovalam Tourist resort project to the Department of Tourism, Government of India. The above amount represents the expenditure incurred by the State Government on the above items and other related works in connection with the Kovalm Project. I am further directed to request that necessary steps for the transfer of the ownership of the property mentioned above to the Department of
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Tourism, Government of India, may kindly be initiated expeditiously.
2. The Accountant General, Commerce, Works & Miscellaneous, New Delhi is being Advised to afford the necessary credit on this account to the Government of Kerala, through the Accountant General Kerala. The expenditure on this account is debitable to Demand No.132 - other Capital Outlay of the Ministry of Tourism and Civil Aviation -Major Road ICO - Capital outlay on other works - B-1 Works - 1 B, (I), Tourist Scheme (Plan) during 196970.
This issues with the concurrence of Ministry of Finance (Freedom Fighter Section) vide their V.C. No.503-TF/70 dated 11.3.1976.
Yours faithfully, sd/(K.K. Sethi)
Deputy Secretary of the Government of India”
transfer of possession by its letter dated 18.7.1970 with reference to the above letter of the Government of India. It is useful to quote the said letter which is to the following effect:
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“GOVERNMENT OF KERALA ABSTRACT
Integrated Development of Kovalam - Transfer of Kovalam Place and Property required for the Scheme to the Government of India - Orders Issued:
Public (Political & Ministry 'A') Department G.O.(MS) No.242/70/PD Dated, Trivandrum, 18th July 1970)
Read:1. Letter No.7. TPL (7)/86 Dated 25th March, 1970 from the Government of India, Ministry of Tourism & Civil Aviation
2. Letter No.Cenl/1456/70 dated 8th may, 1970 from the Managing Director, Kerala District & Handicrafts Corporation Limited.
ORDER
Government hereby sanction the possession of the Kovalam Palace and the adjacent property, measuring 43 acres, acquired for the Kovalam project being handed over to the Department of Tourism, Government of India, with immediate effect pending finalisation of the terms and conditions of transfer.
The agency to when the Palace and property should be handed over, will be intimated in due course.
(By order of the Gevernor) G.Bhaskaran Nair, Special Secretary to Government”
46. In response to the letter of the Government of
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India, the Kerala Government have sanctioned transfer of possession and the property was handed over to the Department of Tourism, Government of India. The letter only mentioned (pending finalization of the terms and conditions of transfer) that the property was handed over to the Government of India on 23.10.1970 and till 18.09.2004 there is not an iota of evidence that the State of Kerala has ever raised any objection regarding non-transfer of title or any objection regarding enjoyment of the property by the Government of India through India Tourism Development Corporation. In pursuance of the disinvestment policy the ITDC through Government of India transferred the property by share purchase agreement in favour of the Writ Petitioners in 2002. Transfer was effected through Global tender and by publication of the scheme of arrangement in the New Indian Express and Malayala Manorama, Thiruvananthapuram Edition dated 14.4.2002. No
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objection was raised by anyone including the State of Kerala. On the basis of Global Tender property was transferred.
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deciding the issue regarding title of the respective parties. We only observe that the sequence of events and the fact that the transfer of possession was effected under the sanction by the President of India on 26.3.1970 and the fact that the ITDC has been running Kovalam Ashok Beach Resort for more than three decades indicates that sudden exercise of power to take possession by notice of less than 48 hours is nothing but arbitrary exercise of power. The mere fact that the 2005 Act purports to validate the taking possession on 25.09.2004 does not mean that the act of
the State is perfectly valid, reasonable and justified. Taking possession of the property by an enactment with retrospective effect in the facts of the present case and sequence of the events indicates that the enactment is arbitrary and unreasonable.
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business after acquisition of the land in 1964, it does not appeal to reason that suddenly after three decades the State decided to resume possession to maintain it as a heritage property. The petitioners have already pleaded as noted above that there is a list of 3269 properties which are notified as monuments and heritage properties, petitioners property has been singled out and meted with discriminatory treatment.
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enacted to deal with one property and resume it by the State.
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purpose has been upheld by the Apex Court in several cases. Property which was being used for hotel business is being run by the State Government, ITDC as well as the petitioners cannot be confiscated in a manner as has been done in the present case by means of an enactment.
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learned Single Judge.
ISSUE NO.III
The appeal is dismissed. Parties shall bear their
own costs.
ASHOK BHUSHAN, Ag. C.J.
A.M. SHAFFIQUE, J.
vsv/vgs/ttb
3 issues framed by the court
Did the Kovalam Palace (Taking Over by Resumption) Act, 2005 encroach upon judicial functions in breach of separation of powers?
Was the Resumption Act arbitrary, discriminatory and violative of Article 14?
Should the declaration that the Resumption Act was unconstitutional and inoperative be upheld?
Colour shows how this judgement treated each authority
M.Far Hotels Ltd. v. Union of India & othersExplained¶136
[2005(1) KLJ 819]
Shri.Prithvi Cotton Mills Ltd. v. Broach Borough Municipality and othersRelied on¶243
[AIR 1970 SC 192] · Who else cites this
Cauvery Water Disputes TribunalRelied on¶267
(AIR 1992 SC 522) · Who else cites this
Ameerunnissa Begum and others v. Mahboob Begum and othersApplied¶572
AIR 1953 SC 91 · Who else cites this
Ram Prasad Narayan Sahi and another v. The State of Bihar and othersApplied¶576
(AIR 1953 SC 215) · Who else cites this
State of Tamil Nadu v. State of KeralaDistinguished¶441
State of Tamil Nadu v. State of Kerala
Madras Bar Association v. Union of India & AnotherDistinguished¶487
Madras Bar Association v. Union of India & Another (2014 (11) Scale 166)
Sanjeev Coke Mfg. Co. v. Bharat Coking Coal Ltd.Relied on¶502
(1983) 1 SCC 147) · Who else cites this
7 provisions across 2 enactments
STATE OF KERALA
THE SECRETARY, DEPARTMENT OF TOURISM
HOTEL LEELAVENTURE LTD.
VENUKRISHNAN
UNION OF INDIA
INDIA TOURISM DEVELOPMENT CORPORATION
ASHOK BHUSHAN
A.M. SHAFFIQUE
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
