Challenge to a SARFAESI auction of secured properties on the ground that it was held without the mandatory 30-day notice under Rule 9(1) of the Security Interest (Enforcement) Rules, 2002. The court held the 30-day period applies only to a first sale; the proviso permits 15 days' notice for a subsequent sale. Appeal dismissed.
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 CHIEF JUSTICE MR.S.MANIKUMAR
&
THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
TUESDAY, THE 07TH DAY OF JANUARY 2020 / 17TH POUSHA, 1941
WA.No.2570 OF 2019
AGAINST THE JUDGMENT DATED 20.06.2019 IN WP(C) NO.14992/2019(Y) OF HIGH COURT OF KERALA
APPELLANTS/PETITIONERS:
2 MEENAKSHI RAJESH, SREE MANGALAM, TEMPLE NAGAR, KIZHAKKEKARA, KOTTARAKKARA P.O., KOLLAM-691506.
BY ADVS. SRI.TITUS MANI SRI.BINNY THOMAS SRI.P.A.JACOB
RESPONDENTS/RESPONDENTS:
1 THE FEDERAL BANK LTD., THIRUVANANTHAPURAM STATUE BRANCH, REPRESENTED BY ITS CHIEF MANAGER, FIRST FLOOR, FEDERAL TOWERS, MG ROAD, THIRUVANANTHAPURAM-695001.
R1 & R2 BY SRI.A.ANTONY R3 BY ADV.SRI.K.SASIKUMAR
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 07.01.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
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“C.R”
JUDGMENT
Dated this the 7th day of January, 2020
S.Manikumar, CJ.
Instant writ appeal is filed against the judgment in W.P.(C) No.14992 of 2019 dated 20th June, 2019, by which the writ court held that while the banks and financial Institutions will have to follow Rule 9(1) of the Security Interest (Enforcement) Rules, 2002 in its letter and spirit, for sale of a secured asset/s at the “the first instance”, when it comes to such sale on a subsequent instance, on account of the first attempt failing, then the provisions of Rule 8(6) read with the proviso to Rule 9(1) of the Rules would alone apply; and axiomatically, the requirement for the Bank in having to wait for 30 days after the publication of the public notice under Rule 8(6) is not attracted for such sale.
Appellants have availed four loans to the tune of Rs.12,47,00,000/against 6 parcels of immovable property having a total extent of 968.91 cents in Kottarakara town during the years 2012 to 2015 from Federal Bank, Thiruvananthapuram, respondent No.1, and offered certain properties as secured assets. Since the appellants committed default, Bank initiated recovery proceedings under the SARFAESI Act, 2002 and took possession of the property on 26.10.2016. They finally issued a sale notice
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dated 28.02.2019 for 3 parcels of immovable properties to the petitioners and fixed the sale on 21.03.2019. They caused public notice in the newspapers only on 01.03.2019, which according to the appellants is only with 19 clear days notice. According to the appellants, Rule 9(1) of the Rules prescribe any sale of immovable property before the expiry of 30 days from the date of publication of the public notice. The sale took place on 21.03.2019, ten days before the expiry of the mandatory notice period, and Travancore Devaswom Board, represented by the Deputy Commissioner, Pathanamthitta, respondent No.3, purchased the immovable properties for a price of Rs.8,20,06,000/-. Being aggrieved, appellants have filed W.P.(C) No.14992 of 2019, and the same was dismissed by the writ court.
“.......Therefore, the requirement under Rule 8(6) and Rule 9(1) contemplates a clear 30 days individual notice to the borrower and also a public notice by way of publication in the newspapers. In other words, while the publication in
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newspaper should provide for 30 days clear notice, since Rule 9(1) also states that such notice of sale is to be in accordance with proviso to sub-rule (6) of Rule 8, 30 days clear notice to the borrower should also be ensured as stipulated under Rule 8(6) as well......”
is an to regulate securitisation and reconstruction of financial assets and enforcement of security interest and to provide for a Central database of security interests created on property rights, and for matters connected therewith or incidental thereto.
7. Section 13 of the SARAFESI Act, 2002 is extracted hereunder:
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section 69A of the Transfer of Property Act, 1882 (4 of 1882), any security interest created in favour of any secured creditor may be enforced, without the intervention of the court or tribunal, by such creditor in accordance with the provisions of this Act.
(2) Where any borrower, who is under a liability to a secured creditor under a security agreement, makes any default in repayment of secured debt or any instalment thereof, and his account in respect of such debt is classified by the secured creditor as non-performing asset, then, the secured creditor may require the borrower by notice in writing to discharge in full his liabilities to the secured creditor within sixty days from the date of notice failing which the secured creditor shall be entitled to exercise all or any of the rights under sub-section (4).
Provided that—
(3) The notice referred to in sub-section (2) shall give details of the amount payable by the borrower and the secured assets intended to be enforced by the secured creditor in the event of nonpayment of secured debts by the borrower.
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(3A) If, on receipt of the notice under sub-section (2), the borrower makes any representation or raises any objection, the secured creditor shall consider such representation or objection and if the secured creditor comes to the conclusion that such representation or objection is not acceptable or tenable, he shall communicate within fifteen days of receipt of such representation or objection the reasons for non-acceptance of the representation or objection to the borrower:
PROVIDED that the reasons so communicated or the likely action of the secured creditor at the stage of communication of reasons shall not confer any right upon the borrower to prefer an application to the Debts Recovery Tribunal under section 17 or the Court of District Judge under section 17A.
(4) In case the borrower fails to discharge his liability in full within the period specified in sub-section (2), the secured creditor may take recourse to one or more of the following measures to recover his secured debt, namely:—
PROVIDED FURTHER that where the management of whole of the business or part of the business is severable, the secured
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creditor shall take over the management of such business of the borrower which is relatable to the security for the debt;
(5) Any payment made by any person referred to in clause (d) of sub-section (4) to the secured creditor shall give such person a valid discharge as if he has made payment to the borrower.
(5A) Where the sale of an immovable property, for which a reserve price has been specified, has been postponed for want of a bid of an amount not less than such reserve price, it shall be lawful for any officer of the secured creditor, if so authorised by the secured creditor in this behalf, to bid for the immovable property on behalf of the secured creditor at any subsequent sale.
(5B) Where the secured creditor, referred to in sub-section (5A), is declared to be the purchaser of the immovable property at any subsequent sale, the amount of the purchase price shall be adjusted towards the amount of the claim of the secured creditor for which the auction of enforcement of security interest is taken by the secured creditor, under sub-section (4) of section 13.
(5C) The provisions of section 9 of the Banking Regulation Act, 1949 (10 of 1949) shall, as far as may be, apply to the immovable property acquired by secured creditor under sub-section (5A).
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(6) Any transfer of secured asset after taking possession thereof or take over of management under sub-section (4), by the secured creditor or by the manager on behalf of the secured creditor shall vest in the transferee all rights in, or in relation to, the secured asset transferred as if the transfer had been made by the owner of such secured asset.
(7) Where any action has been taken against a borrower under the provisions of sub-section (4), all costs, charges and expenses which, in the opinion of the secured creditor, have been properly incurred by him or any expenses incidental thereto, shall be recoverable from the borrower and the money which is received by the secured creditor shall, in the absence of any contract to the contrary, be held by him in trust, to be applied, firstly, in payment of such costs, charges and expenses and secondly, in discharge of the dues of the secured creditor and the residue of the money so received shall be paid to the person entitled thereto in accordance with his rights and interests.
(8) Where the amount of dues of the secured creditor together with all costs, charges and expenses incurred by him is tendered to the secured creditor at any time before the date of publication of notice for public auction or inviting quotations or tender from public or private treaty for transfer by way of lease, assignment or sale of the secured assets,—
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transfer by way of lease or assignment or sale of such secured assets.
(9) Subject to the provisions of the Insolvency and Bankruptcy Code, 2016, in the case of financing of a financial asset by more than one secured creditors or joint financing of a financial asset by secured creditors, no secured creditor shall be entitled to exercise any or all of the rights conferred on him under or pursuant to subsection (4) unless exercise of such right is agreed upon by the secured creditors representing not less than sixty per cent in value of the amount outstanding as on a record date and such action shall be binding on all the secured creditors:
PROVIDED that in the case of a company in liquidation, the amount realised from the sale of secured assets shall be distributed in accordance with the provisions of section 529A of the Companies Act, 1956 (1 of 1956):
PROVIDED FURTHER that in the case of a company being wound up on or after the commencement of this Act, the secured creditor of such company, who opts to realise his security instead of relinquishing his security and proving his debt under proviso to subsection (1) of section 529 of the Companies Act, 1956 (1 of 1956), may retain the sale proceeds of his secured assets after depositing the workmen's dues with the liquidator in accordance with the provisions of section 529A of that Act:
PROVIDED ALSO that liquidator referred to in the second proviso shall intimate the secured creditor the workmen's dues in accordance with the provisions of section 529A of the Companies Act, 1956 (1 of 1956) and in case such workmen's dues cannot be ascertained, the liquidator shall intimate the estimated amount of workmen's dues under that section to the secured creditor and in
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such case the secured creditor may retain the sale proceeds of the secured assets after depositing the amount of such estimate dues with the liquidator:
PROVIDED ALSO that in case the secured creditor deposits the estimated amount of workmen's dues, such creditor shall be liable to pay the balance of the workmen's dues or entitled to receive the excess amount, if any, deposited by the secured creditor with the liquidator:
PROVIDED ALSO that the secured creditor shall furnish an undertaking to the liquidator to pay the balance of the workmen's dues, if any.
Explanation .—For the purposes of this sub-section,—
(10) Where dues of the secured creditor are not fully satisfied with the sale proceeds of the secured assets, the secured creditor may file an application in the form and manner as may be prescribed to the Debts Recovery Tribunal having jurisdiction or a competent court, as the case may be, for recovery of the balance amount from the borrower.
(11) Without prejudice to the rights conferred on the secured creditor under or by this section, secured creditor shall be entitled to
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proceed against the guarantors or sell the pledged assets without first taking any of the measured specifies in clauses (a) to (d) of subsection (4) in relation to the secured assets under this Act.
(12) The rights of a secured creditor under this Act may be exercised by one or more of his officers authorised in this behalf in such manner as may be prescribed.
(13) No borrower shall, after receipt of notice referred to in sub-section (2), transfer by way of sale, lease or otherwise (other than in the ordinary course of his business) any of his secured assets referred to in the notice, without prior written consent of the secured creditor.”
extracted hereunder:
“ 8. Sale of immovable secured assets.-
(1) Where the secured asset is an immovable property, the authorised officer shall take or cause to be taken possession, by delivering a possession notice prepared as nearly as possible in Appendix-IV to these rules, to the borrower and by affixing the possession notice on the outer door or at such conspicuous place of the property.
(2) The possession notice as referred to in sub-rule (1) shall also be published, as soon as possible but in any case not later than seven days from the date of taking possession, in two leading newspapers,] one in vernacular language having sufficient circulation in that locality, by the authorised officer.
(2A) All notices under these rules may also be served upon the borrower through electronic mode of service, in addition to the
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modes prescribed under sub-rule (1) and sub-rule (2) of rule 8.
(3) In the event of possession of immovable property is actually taken by the authorised officer, such property shall be kept in his own custody or in the custody of any person authorised or appointed by him, who shall take as much care of the property in his custody as a owner of ordinary prudence would, under the similar circumstances, take of such property.
(4) The authorised officer shall take steps for preservation and protection of secured assets and insure them, if necessary, till they are sold or otherwise disposed off.
(5) Before effecting sale of the immovable property referred to in sub-rule (1) of rule 9, the authorised officer shall obtain valuation of the property from an approved valuer and in consultation with the secured creditor, fix the reserve price of the property and may sell the whole or any part of such immovable secured asset by any of the following methods:-
(6) The authorised officer shall serve to the borrower a notice of thirty days for sale of the immovable secured assets, under subrule (5):
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PROVIDED that if the sale of such secured asset is being effected by either inviting tenders from the public or by holding public auction, the secured creditor shall cause a public notice in the Form given in Appendix IV-A to be published in two leading newspapers including one in vernacular language having wide circulation in the locality.
(7) Every notice of sale shall be affixed on a conspicuous part of the immovable property and the authorised officer shall upload the detailed terms and conditions of the sale, on the web-site of the secured creditor, which shall include-
(a) the description of the immovable property to be sold, including the details of the encumbrances known to the secured creditor;
(b) the secured debt for recovery of which the property is to be sold;
(c) reserve price of the immovable secured assets below which the property may not be sold;
(d) time and place of public auction or the time after which sale by any other mode shall be completed;
(f) any other terms and conditions, which the authorised officer considers it necessary for a purchaser to know the nature and value of the property.
(8) Sale by any method other than public auction or public
tender, shall be on such terms as may be settled between the secured creditor and the proposed purchaser in writing
extracted hereunder:
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“9. Time of sale, issue of sale certificate and delivery of possession, etc. -
(1) No sale of immovable property under these rules, in first instance shall take place before the expiry of thirty days from the date on which the public notice of sale is published in newspapers as referred to in the proviso to sub-rule (6) of rule 8 or notice of sale has been served to the borrower.
PROVIDED FURTHER that if sale of immovable property by any one of the methods specified by sub-rule (5) of rule 8 fails and sale is required to be conducted again, the authorised officer shall serve, affix and publish notice of sale of not less than fifteen days to the borrower, for any subsequent sale.
(2) The sale shall be confirmed in favour of the purchaser who has offered the highest sale price in his bid or tender or quotation or offer to the authorised officer and shall be subject to confirmation by the secured creditor:
PROVIDED that no sale under this rule shall be confirmed, if the amount offered by sale price is less than the reserve price, specified under sub-rule (5) of rule 8:
PROVIDED FURTHER that if the authorised officer fails to obtain a price higher than the reserve price, he may, with the consent of the borrower and the secured creditor effect the sale at such price.
(3) On every sale of immovable property, the purchaser shall immediately, i.e. on the same day or not later than next working day, as the case may be, pay a deposit of twenty-five per cent. of the amount of the sale price, which is inclusive of earnest money deposit, if any, to the authorised officer conducting the sale and in default of such deposit, the property shall forthwith be sold again.
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(4) The balance amount of purchase price payable shall be paid by the purchaser to the authorised officer on or before the fifteenth day of confirmation of sale of the immovable property or such extended period as may be agreed upon in writing between the purchaser and the secured creditor, in any case not exceeding three months.
(5) In default of payment within the period mentioned in subrule (4), the deposit shall be forfeited to the secured creditor and the property shall be resold and the defaulting purchaser shall forfeit all claims to the property or to any part of the sum for which it may be subsequently sold.
(6) On confirmation of sale by the secured creditor and if the terms of payment have been complied with, the authorised officer exercising the power of sale shall issue a certificate of sale of the immovable property in favour of the purchaser in the form given in Appendix V to these rules.
(7) Where the immovable property sold is subject to any encumbrances, the authorised officer may, if he thinks fit, allow the purchaser to deposit with him the money required to discharge the encumbrances and any interest due thereon together with such additional amount that may be sufficient to meet the contingencies or further cost, expenses and interest as may be determined by him.
PROVIDED that if after meeting the cost of removing encumbrances and contingencies there is any surplus available out of money deposited by the purchaser such surplus shall be paid to the purchaser within fifteen day, from date of finalisation of the sale.
(8) On such deposit of money for discharge of the encumbrances, the authorised officer [shall] issue or cause the purchaser to issue notices to the persons interested in or entitled to
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the money deposited with him and take steps to make the payment accordingly.
(9) The authorised officer shall deliver the property to the purchaser free from encumbrances known to the secured creditor on deposit of money as specified in sub-rule (7) above.
(10) The certificate of sale issued under sub-rule (6) shall specifically mention that whether the purchaser has purchased the immovable secured asset free from any encumbrances known to the secured creditor or not.”
statutes , which are extracted hereunder:
(i) In the words of Tindal, C.J., in Sussex Peerage case [(1844) 11 Cl & F 85], wherein, he said thus, “If the words of the statute are in themselves precise and unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense. The words themselves so alone in such cases best declare the intent of the lawgiver.
(ii) In Nairin v. University of St. Andrews reported in 1909 AC 147, the Hon'ble Apex Court held that, “Unless there is any ambiguity it would not be open to the Court to depart from the normal rule of construction which is that the intention of the Legislature should be primarily gathered from the words which are used. It is only when the words used are ambiguous that they would stand to be examined and construed in the light of surrounding circumstances and constitutional principle and practice.
(iii) In Ram Rattan v. Parma Nand reported in AIR 1946 PC 51, the Hon'ble Mr.S.R.Das, held as follows:
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“The cardinal rule of construction of statutes is to read the statutes literally, that is, by giving to the words their ordinary, natural and grammatical meaning. If, however, such a reading leads to absurdity and the words are susceptible of another meaning, the Court may adopt the same. But if no such alternative construction is possible, the Court must adopt the ordinary rule of literal interpretation. In the present case, the literal construction leads to no apparent absurdity and therefore, there can be no compelling reason for departing from that golden rule of construction.”
(iv) In Poppatlal Shah v. State of Madras reported in AIR 1953 SC 274, the Hon'ble Supreme Court held that, “It is settled rule of construction that to ascertain the legislative intent all the constituent parts of a statute are to be taken together and each word, phrase and sentence is to be considered in the light of the general purpose and object of the Act itself.”
(v) In Rao Shive Bahadur Singh v. State , reported in AIR 1953 SC 394, the Hon'ble Supreme Court held that, “While, no doubt, it is not permissible to supply a clear and obvious lacuna in a statute, and imply a right of appeal, it is incumbent on the Court to avoid a construction, if reasonably permissible on the language, which would render a part of the statute devoid of any meaning or application.”
(vi) What is the spirit of law, Hon'ble Mr. Justice S.R.Das in Rananjaya Singh v. Baijnath Singh reported in AIR 1954 SC 749, said that, “The spirit of the law may well be an elusive and unsafe guide and the supposed spirit can certainly not be given
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effect to in opposition to the plain language of the Sections of the Act.”
(vii) In Hari Prasad Shivashanker Shukla v. A.D.Divelkar
reported in AIR 1957 SC 121, the Hon'ble Apex Court held that,
“It is true that an artificial definition may include a meaning different from or in excess of the ordinary acceptation of the word which is the subject of definition; but there must then be compelling words to show that such a meaning different from or in excess of the ordinary meaning is intended, Where, within the framework of the ordinary acceptation of the word, every single requirement of the definition clause is fulfilled, it would be wrong to take the definition as destroying the essential meaning of the word defined.”
(viii) In Kanai Lal Sur v. Paramnidhi Sadhukhan reported in AIR 1957 SC 907, the Hon'ble Supreme Court held that,
“It must always be borne in mind that the first and primary rule of construction is that the intention of the Legislature must be found in the words used by the Legislature itself. If the words used are capable of one construction only then it would not be open to the courts to adopt any other hypothetical construction on the ground that such hypothetical construction is more consistent with the alleged object and policy of the Act.
The words used in the material provisions of the statute must be interpreted in their plain grammatical meaning and it is only when such words are capable of two constructions that the question of giving effect to the policy or object of the Act can
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legitimately arise. When the material words are capable of two constructions, one of which is likely to defeat or impair the policy of the Act whilst the other construction is likely to assist the achievement of the said policy, then the courts would prefer to adopt the latter construction.
It is only in such cases that it becomes relevant to consider the mischief and defect which the, Act purports to remedy and correct.”
(ix) In Attorney-General v. HRH Prince Ernest Augustus of Hanover reported in (1957) 1 All.ER 49, Lord Somervell of Harrow has explained the unambiguous, as “unambiguous in context”.
(x) In State of W.B., v. Union of India reported in AIR 1963 SC 1241, the Hon'ble Apex Court held that in considering the expression used by the Legislature, the Court should have regard to the aim, object and scope of the statute to be read in its entirety.
(xi) In State of Uttar Pradesh v. Dr.Vijay Anand Maharaj reported in AIR 1963 SC 946, the Supreme Court held as follows:
“But it is said, relying upon certain passages in Maxwell on the Interpretation of Statutes, at p, 68, and in Crawford on "Statutory Construction' at p. 492, that it is the duty of the Judge "to make such construction of a statute as shall suppress the mischief and advance the remedy," and for that purpose the more extended meaning could be attributed to the words so as to bring all matters fairly within the scope of such a statute even though outside the letter, if within its spirit or reason. But both Maxwell and Crawford administered a caution in resorting to such a construction. Maxwell says at p.68 of his book:
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"The construction must not, of course, be strained to include cases plainly omitted from the natural meaning of the words."
Crawford says that a liberal construction does not justify an extension of the statute's scope beyond the contemplation of the Legislature.
The fundamental and elementary rule of construction is that the words and phrases used by the Legislature shall be given their ordinary meaning and shall be constructed according to the rules of grammar. When the language is plain and unambiguous and admits of only one meaning, no question of construction of a statute arises, for the Act speaks for itself. It is a well recognized rule of construction that the meaning must be collected from the expressed intention of the Legislature.”
(xii) In Namamal v. Radhey Shyam reported in AIR 1970 Rajasthan 26, the Court held as follows:
“It was observed by Pollock C. B. in Waugh v. Middleton, 1853-8 Ex 352 (356):-- "It must, however, be conceded that where the grammatical construction is clear and manifest and without doubt, that construction ought to prevail, unless there be some strong and obvious reason to the contrary. But the rule adverted to is subject to this condition, that however plain the apparent grammatical construction of a sentence may be, if it be properly clear from the contents of the same document that the apparent grammatical construction cannot be the true one, then that which, upon the whole, is the true
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meaning shall prevail, in spite of the grammatical construction of a particular part of it." And substantially the same opinion is expressed by Lord Selborne in Caledonian Ry, v. North British Ry. (1881) 6 AC 114 (222):-- "The mere literal construction of a statute ought not to prevail if it is opposed to the intentions of the legislature as apparent by the statute, and if the words are sufficiently flexible to admit of some other construction by which, that intention can be better effectuated." Again Lord Fitzgerald in Bradlaugh v. Clarke, (1883) 8 AC 354 at p. 384 observed as follows:-"I apprehend it is a rule in the construction of statutes that in the first instance the grammatical sense of the words is to be adhered to. If that is contrary to, or inconsistent with, any expressed intention or declared purpose of the statutes, or if it would involve any absurdity, repugnance, or inconsistency, the grammatical sense must then be modified, extended, or abridged, so far as to avoid such an inconvenience, but no further." 11. Maxwell in his book on Interpretation of Statutes (11th Edition) at page 226 observes thus:--
"The rule of strict construction, however, whenever invoked, comes attended with qualifications and other rules no less important, and it is by the light which each contributes that the meaning must be determined. Among them is the rule that that sense of the words is to be adopted which best harmonises with the context and promotes in the fullest manner the policy and object of the legislature. The paramount object, in construing penal
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as well us other statutes, is to ascertain the legislative intent and the rule of strict construction is not violated by permitting the words to have their full meaning, or the more extensive of two meanings, when best effectuating the intention. They are indeed frequently taken in the widest sense, sometimes even in a sense more wide than etymologically belongs or is popularly attached to them, in order to carry out effectually the legislative intent, or, to use Sir Edward Cole's words, to suppress the mischief and advance the remedy.”
(xiii) In Inland Revenue Commissioner v. Joiner reported in (1975) 3 All. ER 1050, it has been held that normally a statutory provision consists of a general description of some factual situation and the legal consequences ensuing from it. Whether the general description is wide or narrow, it will have some limits. The question before a court of law in dealing with a statute is whether the factual situation proved before it falls within the general description given in the statute. A real difficulty in determining the right answer can be said to arise from an “ambiguity” in the statute. It is in this sense that the words, “ambiguity” and “ambiguous” are widely used in judgments.
(xiv) In Commissioner of Sales Tax v. M/s.Mangal Sen Shyamlal reported in 1975 (4) SCC 35 = AIR 1975 SC 1106, the Hon'ble Apex Court held that,
"A statute is supposed to be an authentic repository of the legislative will and the function of a court is to interpret it "according to the intent of them that made it". From that function the court is. not to resile. It has to abide by the maxim, “ut res
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magis valiat quam pereat”, lest the intention of the legislature may go in vain or be left to evaporate into thin air."
(xv) In C.I.T., Madras v. T.Sundram Iyengar (P) Ltd. , reported in (1976) 1 SCC 77, the Hon'ble Supreme Court held that, if the language of the statute is clear and unambiguous and if two interpretations are not reasonably possible, it would be wrong to discard the plain meaning of the words used, in order to meet a possible injustice.
(xvi) If the words are precise and unambiguous, then it should be accepted, as declaring the express intention of the legislature. In Ku.Sonia Bhatia v. State of U.P. , and others reported in 1981 (2) SCC 585 = AIR 1981 SC 1274, the Hon'ble Supreme Court held that a legislature does not waste words, without any intention and every word that is used by the legislature must be given its due import and significance.
(xvii) In LT.-Col. Prithi Pal Singh Bedi v. Union of India reported in (1983) 3 SCC 140, at Paragraph 8, the Hon'ble Supreme Court held as follows:
“8. The dominant purpose in construing a statute is to ascertain the intention of the Parliament. One of the well recognised canons of construction is that the legislature speaks its mind by use of correct expression and unless there is any ambiguity in the language of the provision the Court should adopt literal construction if it does not lead to an absurdity. ..........If the literal construction leads to an absurdity, external aids to construction can be resorted to. To ascertain the literal meaning it is equally necessary first to ascertain the juxtaposition in which the rule is placed, the purpose for which
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it is enacted and the object which it is required to subserve and the authority by which the rule is framed. This necessitates examination of the broad features of the Act.”
(xviii) In Philips India Ltd. , v. Labour Court reported in 1985 (3) SCC 103, the Hon'ble Apex Court, at Paragraph 15, held as follows:
“(15) No cannon of statutory construction is more firmly, established than that the statute must be read as a whole. This is a general rule of construction applicable to all statutes alike which is spoken of as construction ex visceribus actus. This rule of statutory construction is so firmly established that it is variously styled as 'elementary rule' (See Attorney General v. Bastow [(1957) 1 All.ER 497]) and as a 'settled rule' (See Poppatlal Shall v. State of Madras [1953 SCR 667 : AIR 1953 SC 274]). The only recognised exception to this well-laid principle is that it cannot be called in aid to alter the meaning of what is of itself clear and explicit. Lord Coke laid down that: 'it is the most natural and genuine exposition of a statute, to construe one part of a statute by another part of the same statute, for that best expresseth meaning of the makers' (Quoted with approval in Punjab Breverages Pvt. Ltd. v. Suresh Chand [(1978) 3 SCR 370 : (1978) 2 SCC 144 : 1978 SCC (L&S) 165]).”
(xix) In Narendra H.Khzurana v. Commissioner of Police reported in 2004 (2) Mh.L.R. 72, it was held that, it must be noted the proper course in interpreting a statute in the first instance is to examine its language and then ask what is the natural meaning uninfluenced by the considerations derived from previous state of law and then assume that it was property intended to leave unaltered. It
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is settled legal position, therefore, that the Courts must try to discover the real intent by keeping the direction of the statute intact.
(xx) In Nyadar Singh v. Union of India reported in AIR 1988 SC 1979, the Hon'ble Apex Court observed that ambiguity need not necessarily be a grammatical ambiguity, but one of the appropriateness of the meaning in a particular context.
(xxi) It is a well settled law of interpretation that “when the words of the statute are clear, plain or unambiguous, ie., they are reasonably susceptible to only one meaning, the Courts are bound to give effect to that meaning irrespective of consequences. Reference can be made to the decision of the Hon'ble Apex Court in Nelson Motis v. Union of India reported in AIR 1992 SC 1981.”
(xxii) In M/s.Oswal Agro Mills Ltd., v. Collector of Central Excise and others reported in 1993 Supp (3) SCC 716 = AIR 1993 SC 2288, the Hon'ble Apex Court held that,
“where the words of the statute are plain and clear, there is no room for applying any of the principles of interpretation, which are merely presumption in cases of ambiguity in the statute. The Court would interpret them as they stand.”
(xxiii) In Nasiruddin v. Sita Ram Agarwal reported in (2003) 2 SCC 577, the Hon'ble Supreme Court held as follows:
“35. In a case where the statutory provision is plain and unambiguous, the court shall not interpret the same in a different manner, only because of harsh consequences arising therefrom....
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a given case the court can iron out the fabric but it cannot change the texture of the fabric. It cannot enlarge the scope of legislation or intention when the language of the provision is plain and unambiguous. It cannot add or subtract words to a statute or read something into it which is not there. It cannot rewrite or recast legislation. It is also necessary to determine that there exists a presumption that the legislature has not used any superfluous words. It is well settled that the real intention of the legislation must be gathered from the language used. ......But the intention of the legislature must be found out from the scheme of the Act.”
(xxiv) In Indian Dental Association, Kerala v. Union of India reported in 2004 (1) Kant. LJ 282, the Court held that,
“The cardinal rule for the construction of Acts of Parliament is that they should be construed according to the intention expressed in the Acts themselves. The object of all interpretation is to discover the intention of Parliament, "but the intention of Parliament must be deduced from the language used", for it is well-accepted that the beliefs and assumptions of those who frame Acts of Parliament cannot make the law. If the words of the statute are themselves precise and unambiguous, then no more can be necessary than to expound those words in their ordinary and natural sense. Where the language of an Act is clear and explicit, the Court must give effect to it, whatever may be the consequences, for in that case the words of the statute speak the intention of the Legislature. Where the language is plain and admits of but one meaning, the task of interpretation can hardly be said to arise.
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The decision in a case calls for a full and fair application of particular statutory language to particular facts as found. It is a corollary to the general rule of literal construction that nothing is to be added to or taken from a statute unless there are adequate grounds to justify the inference that the Legislature intended something which it omitted to express. A construction which would leave without effect any part of the language of a statute will normally be rejected.”
(xxv) In Nathi Devi v. Radha Devi Gupta reported in AIR 2005 SC 648, the Hon'ble Apex Court held that,-
“The interpretation function of the Court is to discover the true legislative intent, it is trite that in interpreting a statute the Court must, if the words are clear, plain, unambiguous and reasonably susceptible to only one meaning, give to the words that meaning, irrespective of the consequences. Those words must be expounded in their natural and ordinary sense. When a language is plain and unambiguous and admits of only one meaning no question of construction of statute arises, for the Act speaks for itself. Courts are not concerned with the policy involved or that the results are injurious or otherwise, which may follow from giving effect to the language used. If the words used are capable of one construction only then it would not be open to the Courts to adopt any other hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. In considering whether there is ambiguity, the Court must look at the statute as a whole and consider the appropriateness of the meaning in a particular context avoiding absurdity and inconsistencies or unreasonableness which may render the statute unconstitutional.”
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In Nathi Devi's case, it was further held that,
“It is equally well-settled that in interpreting a statute, effort should be made to give effect to each and every word used by the Legislature. The Courts always presume that the Legislature inserted every part thereof for a purpose and the legislative intention is that every part of the statute should have effect. A construction which attributes redundancy to the legislature will not be accepted except for compelling reasons such as obvious drafting errors.”
(xxvi) In Justice G.P. Singh's Principles of Statutory Interpretation (11th Edn., 2008), the learned author while referring to judgments of different Courts states (at page 134) that procedural laws regulating proceedings in court are to be construed as to render justice wherever reasonably possible and to avoid injustice from a mistake of court. He further states (at pages 135 and 136) that: "Consideration of hardship, injustice or absurdity as avoiding a particular construction is a rule which must be applied with great care. "The argument ab inconvenienti", said LORD MOULTON, "is one which requires to be used with great caution".
(xxvii) In State of Jharkhand v. Govind Singh reported in (2005) 10 SCC 437, the Hon'ble Supreme Court held that,
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not easy as the “language” is often misunderstood even in ordinary conversation or correspondence. The tragedy is that although in the matter of correspondence or conversation the person who has spoken the words or used the language can be approached for clarification, the legislature cannot be approached as the legislature, after enacting a law or Act, becomes functus officio so far as that particular Act is concerned and it cannot itself interpret it. No doubt, the legislature retains the power to amend or repeal the law so made and can also declare its meaning, but that can be done only by making another law or statute after undertaking the whole process of law-making.
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“It endangers continued public confidence in the political impartiality of the judiciary, which is essential to the continuance of the rule of law, if judges, under the guise of interpretation, provide their own preferred amendments to statutes which experience of their operation has shown to have had consequences that members of the court before whom the matter comes consider to be injurious to the public interest.”
(xxviii) In Vemareddy Kumaraswamy Reddy v. State of A.P. , reported in (2006) 2 SCC 670, the Hon'ble Supreme Court held that,
“12. It is said that a statute is an edict of the legislature. The elementary principle of interpreting or construing a statute is to gather the mens or sententia legis of the legislature. It is well-settled principle in law that the court cannot read anything into a statutory provision which is plain and unambiguous.”
(xxix) In A.N.Roy Commissioner of Police v. Suresh Sham Singh reported in AIR 2006 SC 2677, the Hon'ble Apex Court held that,
“It is now well settled principle of law that, the Court cannot change the scope of legislation or intention, when the language of the statute is plain and unambiguous. Narrow and pedantic construction may not always be given effect to. Courts should avoid a construction, which would
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reduce the legislation to futility. It is also well settled that every statute is to be interpreted without any violence to its language. It is also trite that when an expression is capable of more than one meaning, the Court would attempt to resolve the ambiguity in a manner consistent with the purpose of the provision, having regard to the great consequences of the alternative constructions.”
(xxx) In Adamji Lookmanji & Co. v. State of Maharastra reported in AIR 2007 Bom. 56, the Bombay High Court held that, when the words of status are clear, plain or unambiguous, and reasonably susceptible to only meaning, Courts are bound to give effect to that meaning irrespective of the consequences. The intention of the legislature is primarily to be gathered from the language used. Attention should be paid to what has been said in the statute, as also to what has not been said.
(xxxi) In State of Haryana v. Suresh reported in 2007 (3) KLT 213, the Hon'ble Supreme Court held that,
“One of the basic principles of Interpretation of Statutes is to construe them according to plain, literal and grammatical meaning of the words. If that is contrary, to or inconsistent with any express intention or declared purpose of the Statute, or if it would involve any absurdity, repugnancy or inconsistency, the grammatical sense must then be modified, extended or abridged, so far as to avoid such an inconvenience, but no further. The onus of showing that the words do not mean what they say lies heavily on the party who alleges it must advance something which clearly shows that the grammatical construction would be repugnant to the
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intention of the Act or lead to some manifest absurdity.”
(xxxii) In Visitor Amu v. K.S.Misra reported in (2007) 8 SCC 594, the Hon'ble Supreme Court held that,
“It is well settled principle of interpretation of the statute that it is incumbent upon the Court to avoid a construction, if reasonably permissible on the language, which will render a part of the statute devoid of any meaning or application. The Courts always presume that the legislature inserted every part thereof for a purpose and the legislative intent is that every of the statute should have effect. The legislature is deemed not to waste its words or to say anything in vain and a construction which attributes redundancy to the legislature will not be accepted except for compelling reasons. It is not a sound principle of construction to brush aside words in a statute as being in apposite surplusage, if they can have appropriate application in circumstances conceivably within the contemplation of the statute.”
(xxxiii) In Gujarat Urja Vikas Nigam Ltd. v. Essar Power Ltd., reported in (2008) 4 SCC 755, the Hon'ble Supreme Court, at Paragraphs 52, 54, 55 and 56, held as follows:
“52. No doubt ordinarily the literal rule of interpretation should be followed, and hence the court should neither add nor delete words in a statute. However, in exceptional cases this can be done where not doing so would deprive certain existing words in a statute of all meaning, or some part of the statute may become absurd.”
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(xxxiv) In Phool Patti v. Ram Singh reported in (2009) 13 SCC 22, the Hon'ble Supreme Court held that,
“9. It is a well-settled principle of interpretation that the court cannot add words to the statute or change its language, particularly when on a plain reading the meaning seems to be clear.”
(xxxv) In Mohd. Shahabuddin v. State of Bihar , reported in (2010) 4 SCC 653, the Hon'ble Supreme Court held that,
“179. Even otherwise, it is a well-settled principle in law that the court cannot read anything into a statutory provision which is plain and unambiguous. The language employed in a statute is a determinative factor of the legislative intent. If the language of the enactment is clear and unambiguous, it would not be proper for the courts to add any words thereto and evolve some legislative intent, not found in the statute. Reference in this regard may be made to a recent decision of this Court in Ansal Properties & Industries Ltd. v. State of Haryana [(2009) 3 SCC 553]
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the condition at one place in the provision the legislature also intended the condition to be applied at some other place in that provision.”
(xxxvi) In Satheedevi v. Prasanna reported in (2010) 5 SCC 622, the Hon'ble Supreme Court held as follows:
“12. Before proceeding further, we may notice two well-recognised rules of interpretation of statutes. The first and primary rule of construction is that the intention of the legislature must be found in the words used by the legislature itself. If the words used are capable of one construction, only then it would not be open to the courts to adopt any other hypothetical construction on the ground that such hypothetical construction is more consistent with the alleged object and policy of the Act. The words used in the material provisions of the statute must be interpreted in their plain grammatical meaning and it is only when such words are capable of two constructions that the question of giving effect to the policy or object of the Act can legitimately arise--Kanai Lal Sur v. Paramnidhi Sadhukhan [AIR 1957 SC 907]
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Corpn. [AIR 1966 SC 1678]”
(xxxvii) In Sri Jeyaram Educational Trust & Ors., v. A.G.Syed Mohideen & Ors. [2010 CIJ 273 SC (1)], it was held that,
"6. It is now well settled that a provision of a statute should have to be read as it is, in a natural manner, plain and straight, without adding, substituting or omitting any words. While doing so, the words used in the provision should be assigned and ascribed their natural, ordinary or popular meaning. Only when such plain and straight reading, or ascribing the natural and normal meaning to the words on such reading, leads to ambiguity, vagueness, uncertainty, or absurdity which were not obviously intended by the Legislature or the Lawmaker, a court should open its interpretation tool kit containing the settled rules of construction and interpretation, to arrive at the true meaning of the provision. While using the tools of interpretation, the court should remember that it is not the author of the Statute who is empowered to amend, substitute or delete, so as to change the structure and contents. A court as an interpreter cannot alter or amend the law. It can only interpret the provision, to make it meaningful and workable so as to achieve the legislative object, when there is vagueness, ambiguity or absurdity. The purpose of interpretation is not to make a provision what the Judge thinks it should be, but to make it what the legislature intended it to be."
(xxxviii) In Delhi Airtech Services (P) Ltd. v. State of U.P. , reported in (2011) 9 SCC 354, the Hon'ble Supreme Court, while dealing with a provision under Section 17(3-A) of the Act, held that,
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“Therefore, the provision of Section 17(3-A) cannot be viewed in isolation as it is an intrinsic and mandatory step in exercising special powers in cases of emergency. Sections 17(1) and 17(2) and 17(3-A) must be read together. Sections 17(1) and 17(2) cannot be worked out in isolation.
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(xxxix) In Noida Entrepreneurs Association v. Noida reported in (2011) 6 SCC 58, at paragraph 25, the Hon'ble Supreme Court held as follows:
“22. It is a settled proposition of law that whatever is prohibited by law to be done, cannot legally be affected by an indirect and circuitous contrivance on the principle of "quando aliquid prohibetur, prohibetur at omne per quod devenitur ad illud", which means" "whenever a thing is prohibited, it is prohibited whether done directly or indirectly". (See: Swantraj & Ors. v. State of Maharashtra, AIR 1974 SC 517; Commissioner of Central Excise, Pondicherry v. ACER India Ltd., (2004) 8 SCC 173; and Sant Lal Gupta & Ors., v. Modern Co-operative Group Housing Society Ltd., & Ors., JT (2010) 11 SC 273).
At Paragraph 26 in Noida Entrepreneurs Association's case (cited supra), the Hon'ble Apex Court, further held that,
“23. In Jagir Singh v. Ranbir Singh & Anr. AIR 1979 SC 381, this Court has observed that an authority cannot be permitted to evade a law by "shift or contrivance." While deciding the said case, the Court placed reliance on the judgment in Fox v. Bishop of Chester, (1824) 2 B &C 635, wherein it was observed as under:-
"To carry out effectually the object of a statute, it must be construed as to defeat all attempts to do, or avoid doing in an indirect or circuitous manner that which it has prohibited or enjoined."
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“(i) In Samrao v. District Magistrate, Thana reported in AIR 1952 SC 324, the Hon'ble Apex Court held that,-
“It is the duty of the Courts to give effect to the meaning of an Act, when the meaning can be fairly gathered from the words used, that is to say, if one construction will lead to an absurdity while another will give effect to what common sense would show was obviously intended, the construction which would defeat the ends of the Act, must be rejected even if the same words used in the same section, and even the same sentence, have to be construed differently. Indeed the law goes so far as to require the Courts sometimes even to modify the grammatical and ordinary sense of the words if by doing so absurdity and inconsistency can be avoided.”
(ii) In D.N.Banerji v. P.R.Mukherjee reported in AIR 1953 SC 58, the Hon'ble Supreme Court held that the same word may mean one thing in one context and another in a different context.
(iii) It is well settled that a statute must be read as a whole and one provision of the Act should be construed with reference to other provisions in the same Act, so as to make a consistent enactment of the whole statute. Such a construction has the merit of avoiding any inconsistency or repugancy either within the statute or between a Section or other parts of the statute. [Ref. Raj Krishna v. Bonod Kanungo reported in AIR 1954 SC 202].
(iv) In Rananjaya Singh v. Baji Nath Singh reported in AIR 1954 SC 749, the Hon'ble Apex Court held that,
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“The spirit of law may well be an illusive and unsafe guide in the interpretation of the statutes and the supposed spirit can certainly not be given effect to in opposition to the plain language of the sections of the Act, and the rules made thereunder. If all that can be said of these statutory provisions is that construed according to the ordinary, grammatical and natural meaning of their language they work injustice, the appeal must be made to the Parliament and not to the Supreme Court.”
(v) In The State of Bihar v. Hira Lal Kejriwal reported in AIR 1960 SC 47, the Hon'ble Supreme Court, at Paragraph 6, held that,
“To ascertain the meaning of a section it is not permissible to omit any part of it: the whole section should be read together and an attempt should be made to reconcile both the parts. ......The first part gives life to that Order, and, therefore, the acts authorised under that Order can be done subsequent to the coming into force of the Ordinance. ......The second part appears to have been enacted for the purpose of avoiding this difficulty or, at any rate, to dispel the ambiguity.”
(vi) In S.Gurmej Singh v. S.Pratap Singh reported in AIR 1960 SC 122, the Hon'ble Supreme Court, at Paragraph 9, held as follows:
“It is an elementary rule that construction of a section is to be made of all the parts together and not of
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one part only by itself, and that phrases are to be construed according to the rules of grammar.”
(vii) In A.R.Antulay v. Ramdas Sriniwas Nayak reported in (1984) 2 SCC 500, the Supreme Court held that,
“It is a well established cannon of construction that the court should read the section as it is and cannot rewrite it to suit its convenience; nor does any cannon of construction permit the court to read the section in such manner as to render it to some extent otiose.”
(viii) In the case of Reserve Bank of India v. Peerless G.F., & Co., Ltd. , AIR 1987 SC 1023, the Hon'ble Apex Court held :
"Interpretation must depend on the text and the context. They are the bases of interpretation. One may well say if the text is the texture, context is what gives the colour. Neither can be ignored. Both are important. That interpretation is best which makes the textual interpretation match the contextual. A statute is best interpreted when we know why it was enacted. With this knowledge, the statute must be read, first as a whole and then section by section, clause by clause, phrase by phrase and word by word. If a statute is looked at, in the context of its enactment, with the glasses of the statutemaker, provided by such context, its scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover
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what each section, each clause, each phrase and each word is meant and designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. Statutes have to be construed so that every word has a place and everything is in its place."
(ix) In Balasinor Nagrik Co-operative Bank Ltd., v. Babubhai Shankerlal Pandya reported in (1987) 1 SCC 606, the Hon'ble Supreme Court, at Paragraph 4, held as follows:
“It is an elementary rule that construction of a section is to be made of all parts together. It is not permissible to omit any part of it. For, the principle that the statute must be read as a whole is equally applicable to different parts of the same section. .......It also provides for the manner of the exercise of such power. .......... Sub-section (1) of Section 36 is made subject to the fulfillment of the conditions prerequisite,”
(x) In Balasinor Nagrik Co-operative Bank's case (cited supra), the Hon'ble Apex Court held that precise functions of the two provisos to a Section has to be read together. The Supreme Court held that sub-Section (1) of Section 36 is made subject to defeasance clause engrafted in the first provision. If the guiding principle enunciated in Balasinor Nagrik Co-operative Bank's case (cited supra), is applied to Section 408 Cr.P.C., then it would certainly convey that the Sessions Judge can transfer only a case from a lower Court and not from a Court of equal jurisdiction.
(xi) In Ganga Prasad Verma (Dr.) v. State of Bihar [1995 Supp (1) SCC 192], it has been held that: (SCC p. 195, para 5)
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“5. Where the language of the Act is clear and explicit, the court must give effect to it, whatever may be the consequences, for in that case the words of the statute speak the intention of the legislature.”
(xii) In State of Gujarat v. Salimbhai Abdulgaffar Shaikh reported in (2003) 8 SCC 50, the Hon'ble Supreme Court held that,
“Broadly speaking, therefore, an appeal is a proceeding taken to rectify an erroneous decision of a Court by submitting the question to a higher Court.......
........It is well settled principle that the intention of the legislature must be found by reading the Statute as a whole. Every clause of Statute should be construed with reference to the context and other clauses of the Act, so as, as far as possible, to make a consistent enactment of the whole Statute. It is also the duty of the Court to find out the true intention of the legislature and to ascertain the purpose of Statute and give full meaning to the same. The different provisions in the Statute should not be interpreted in abstract but should be construed keeping in mind the whole enactment and the dominant purpose that it may express.”
(xiii) In Balram Kumawat v. Union of India reported in (2003) 7 SCC 628, the Hon'ble Supreme Court held that,
“Contextual reading is a well-known proposition of interpretation of statute. The classes of a statute should be construed with reference to the context vis-avis the other provisions so as to make a consistent enactment of the whole statute relating to the subject-
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matter. The rule of "ex visceribus actus" should be resorted to in a situation of this nature.”
(xiv) In T.N.State Electricity Board v. Central Electricity Regulatory Commission reported in (2007) 7 SCC 636, the Hon'ble Supreme Court held that,
“Resort can be had to the legislative intent for the purpose of interpreting a provision of law, when the language employed by the legislature is doubtful or susceptible of meanings more than one. However, when the language is plain and explicit and does not admit of any doubtful interpretation, the Supreme Court cannot, by reference to an assumed legislative intent expand the meaning of an expression employed by the legislature and therein include such category of persons as the legislature has not chosen to do.”
(xv) In Ansal Properties & Industries Ltd. v. State of Haryana , reported in (2009) 3 SCC 553, the Hon'ble Supreme Court held that,
“It is a well-settled principle in law that the court cannot read anything into a statutory provision which is plain and unambiguous. The language employed in a statute is determinative factor of legislative intent. If the language of the enactment is clear and unambiguous, it would not be proper for the courts to add any words thereto and evolve some legislative intent, not found in the statute.”
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interpreted and the same is reproduced:
“(i) Lord Russel in Jennings v. Kelly reported in (1939) 4 All. ER 464, said thus,
“Although a proviso may well be incapable of putting upon preceding words a construction which they cannot possibly bear, it may without doubt operate to explain which of the two or more possible meanings is the right one to attribute to them. One must, however, read the whole clause before attempting to construe any portion of it, and a perusal of the proviso fixes the meaning of the words which precede it.”
Lord Right in the same judgment, said that,
“It is said that, where there is a proviso, the former part which is described as the enacting part, must be construed without reference to the proviso. No doubt, there may be cases in which first part is so clear or unambiguous as not to admit in regard to the matters which are there clear any reference to any other part of the Section. The proviso may simply be an exception of what is clearly defined in the first part, or it may be some qualification not inconsistent with what is expressed in the first part.”
(ii) Reference can also made to, what Lord Thankerdon observed in Province Of Bombay v. Hormusji Manekji reported in AIR 1947 PC 200, as follows:
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“It is a familiar principle of statutory construction that where you find in the same section express exceptions from the operative part of the section, it may be assumed, unless it otherwise appears from the language employed, that these exceptions were necessary, as otherwise the subject-matter of the exceptions would have come within the operative provisions of the section. There are four exceptions in the proviso to Section 4, which are clearly general exceptions to the operative provisions of the section.”
(iii) In Ram Narain Sons Ltd., v. Assistant Commissioner of
Sales Tax reported in AIR 1955 SC 765, the Hon'ble Supreme Court has held that,
“that a proviso to a particular provision of a statute only embraces the field which is covered by the main provision. It carves out an exception to the main provision to which it has been enacted as a proviso and to no other.”
can be made to few decisions:
“(i) In CIT v. Badhraja and Company reported in 1994 Supp (1) SCC 280, the Hon'ble Apex Court held that an object oriented approach, however, cannot be carried to the extent of doing violence to the plain meaning of the Section used by rewriting the Section or substituting the words in the place of actual words used by the legislature.
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(ii) In Dadi Jagannadham v. Jammulu Ramulu reported in (2001) 7 SCC 71, the Hon'ble Supreme Court held that,
“13. We have considered the submissions made by the parties. The settled principles of interpretation are that the court must proceed on the assumption that the legislature did not make a mistake and that it did what it intended to do. The court must, as far as possible, adopt a construction which will carry out the obvious intention of the legislature. Undoubtedly if there is a defect or an omission in the words used by the legislature, the court would not go to its aid to correct or make up the deficiency. The court could not add words to a statute or read words into it which are not there, especially when the literal reading produces an intelligible result. The court cannot aid the legislature's defective phrasing of an Act, or add and mend, and, by construction, make up deficiencies which are there.”
(iii) In Institute of C.A. of India v. Ajit Kumar Iddya reported in AIR 2003 Kant. 187, the Karnataka High Court held that,
“So far as the cardinal law of interpretation is concerned, it is settled that if the language is simple and unambiguous, it is to be read with the clear intention of the legislation. Otherwise also, any addition/subtraction of a word is not permissible. In other words, it is not proper to use a sense, which is different from what the word used ordinarily conveys. The duty of the Court is not to fill up the gap by stretching a word used. It is also settled that a provision is to be read as a whole and while interpreting, the intention
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and object of the legislation have to be looked upon. However, each case depends upon the facts of its own.”
(iv) In Sanjay Singh v. U.P. Public Service Commission reported in (2007) 3 SCC 720, the Hon'ble Supreme Court held that, -
“It is well settled that courts will not add words to a statute or read into the statute words not in it. Even if the courts come to the conclusion that there is any omission in the words used, it cannot make up the deficiency, where the wording as it exists is clear and unambiguous. While the courts can adopt a construction which will carry out the obvious intention of the legislative or the rule-making authority, it cannot set at naught the legislative intent clearly expressed in a statute or the rules.”
(v) In Mohan v. State of Maharashtra reported in (2007) 9 SCC 431, the Hon'ble Supreme Court held that,
“9. In our opinion under Section 11-A what has to be seen is the date of last publication of the declaration under Section 6, and not any subsequent corrigendum to the said declaration. The only circumstance under which the period between the declaration under Section 6 and the award can be extended is mentioned in the Explanation to Section 11-A which states: “In computing the period of two years referred to in this section, the period during which any action or proceeding to be taken in pursuance of the said declaration is stayed by an order of a court shall be excluded.” There is no mention in Section 11-A that the period after the publication of the declaration under Section 6 and the publication of any corrigendum to the
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said declaration has also to be excluded. We will be adding words to the statute if we put such interpretation to Section 11-A, and it is well settled that the court should not add or delete words in a statute.”
(i) In Ram Rattan v. Parma Nand reported in AIR 1946 PC 51, the Hon'ble Mr. Justice S.R.Das, held as follows:
“The cardinal rule of construction of statutes is to read the statutes literally, that is, by giving to the words their ordinary, natural and grammatical meaning. If, however, such a reading leads to absurdity and the words are susceptible of another meaning, the Court may adopt the same.
But if no such alternative construction is possible, the Court must adopt the ordinary rule of literal interpretation. In the present case, the literal construction leads to no apparent absurdity and therefore, there can be no compelling reason for departing from the golden rule of construction.”
(ii) The Hon'ble Supreme Court in Bhatia International v. Bulk Trading S.A. and Another reported in (2002) 4 SCC 105, at paragraph No.15, held as follows:
"15......The conventional way of interpreting a statute is to seek the intention of its makers. If a statutory provision is open to more than one interpretation then the Court has to choose that interpretation which represents the true intention of the legislature. This task often is not an easy one and several difficulties arise on account of variety of reasons, but at the same, it must be borne in mind that it is impossible even for
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the most imaginative legislature to forestall exhaustively situations and circumstances that may emerge after enacting a statute where its application may be called for. It is in such a situation the Courts' duty to expound arises with a caution that the Court should not try to legislate. While examining a particular provision of a statute to find out whether the jurisdiction of a Court is ousted or not, the principle of universal application is that ordinarily the jurisdiction may not be ousted unless the very statutory provision explicitly indicates or even by inferential conclusion the Court arrives at the same when such a conclusion is the only conclusion. Notwithstanding the conventional principle that the duty of judges is to expound and not to legislate. The Courts have taken the view that the judicial art of interpretation and appraisal is imbued with creativity and realism and since interpretation always implied a degree of discretion and choice, the Court would adopt particularly in areas such as, constitutional adjudication dealing with social and defuse rights. Courts are therefore, held as "finishers, refiners, and polishers of legislatures which gives them in a state requiring varying degrees of further processing". (see Corrocraft Ltd., v. Pan American Airways (1968) 3 WLR 714 at page 732, AIR 1975 SC 1951 at page 1957. If a language used is capable of bearing more than one construction, in selecting the true meaning, regard must be had to the consequences, resulting from adopting the alternative constructions. A construction that results in hardship, serious inconvenience, injustice, absurdity or anomaly or which leads to inconsistency or uncertainty and friction in the system which the statute purports to regulate has to be rejected and preference should be given to that
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construction which avoids such results. (see Johnson v. Moreton (1978) 3 All. ER 37 and Stock v. Frank Jones (Tipton) Ltd. (1978) 1 All. ER 948). In selecting out of different interpretations the Court will adopt that which is just reasonable and sensible rather than that which is none of those things, as it may be presumed that the legislature should have used the word in that interpretation which least offends our sense of justice. In Shanon Realites Ltd. v. Sant Michael (924) A.C. page 185 at page 192-193 Lord Shaw stated, "where words of a statute are clear, they must, of course, be followed, but in their Lordships opinion where alternative constructions are equally open that alternative is to be chosen which will be consistent with the smooth working of the system which the statute purports to be regulating and that alternative is to be rejected which will introduce uncertainty, friction or confusion into the working of the system."
This principle was accepted by Subba Rao, J. while construing Section 193 of the Sea Customs Act and in coming to the conclusion that the Chief of Customs Authority was not an officer of custom. (AIR 1961 SC 1549).
(iii) In State of Haryana v. Suresh reported in 2007 (3) KLT 213, the Hon'ble Supreme Court held that,
“One of the basic principles of Interpretation of Statutes is to construe them according to plain, literal and grammatical meaning of the words. If that is contrary, to or inconsistent with any express intention or declared purpose of the Statute, or if it would involve any absurdity, repugnancy or inconsistency, the grammatical sense must then be modified, extended or abridged, so far
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as to avoid such an inconvenience, but no further. The onus of showing that the words do not mean what they say lies heavily on the party who alleges it must advance something which clearly shows that the grammatical construction would be repugnant to the intention of the Act or lead to some manifest absurdity.”
Rules is reproduced:
“(1) No sale of immovable property under these rules, in first instance shall take place before the expiry of thirty days from the date on which the public notice of sale is published in newspapers as referred to in the proviso to sub-rule (6) of rule 8 or notice of sale has been served to the borrower.”
1046(E) dated 03.11.2016, legislature has added thus:
“Provided that if sale of immovable property by any one of the methods specified by sub-rule (5) of rule 8 fails and sale is required to be conducted again, the authorised officer shall serve, affix and publish notice of sale of not less than fifteen days to the borrower, for any subsequent sale.”
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We find no error in the judgment dated 20.06.2019 passed in W.P.
(C) No.14992 of 2019 and, therefore, writ appeal is dismissed. No costs.
Sd/S.MANIKUMAR CHIEF JUSTICE
Sd/SHAJI P.CHALY JUDGE
Krj.7/1
//TRUE COPY//
P.A. TO JUDGE
2 issues framed by the court
Whether the proviso to Rule 9(1) of the Security Interest (Enforcement) Rules, 2002 permits a 15-day notice of sale for a subsequent sale instead of the 30-day notice prescribed for a sale at the firs
Whether the sale of the secured assets held on 21.03.2019, on less than 30 days' notice, is non est and a nullity for breach of Rules 8 and 9(1) of the Rules?
Colour shows how this judgement treated each authority
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1909 AC 147
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Poppatlal Shah v. State of MadrasReferred¶10
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(2011) 6 SCC 58 · Who else cites this
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(2002) 4 SCC 105 · Who else cites this
4 provisions across 2 enactments
Rajesh Sivasankara Pillai
Meenakshi Rajesh
The Federal Bank Ltd.
The Authorised Officer, The Federal Bank Ltd.
Travancore Devaswom Board
S.Manikumar
Shaji P.Chaly
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
