Mahant Sri Jagannath Ramanuj Das &
ANR Vs. The State of Orissa & ANR [1954] INSC 27 (16 March 1954)
MUKHERJEA, B.K.
HASAN, GHULAM MAHAJAN, MEHAR CHAND (CJ) DAS,
SUDHI RANJAN BOSE, VIVIAN
CITATION: 1954 AIR 400 1954 SCR 1046
CITATOR INFO :
F 1956 SC 432 (2,5) R 1959 SC 942 (12,15) R
1961 SC 459 (11,43) R 1962 SC 853 (34) RF 1962 SC1371 (37,78) R 1965 SC1107
(48) RF 1971 SC 344 (6) R 1971 SC1182 (5) R 1972 SC1586 (12) RF 1973 SC 724
(43) R 1975 SC 846 (14) R 1976 SC1059 (29) F 1978 SC1181 (5) R 1980 SC1008 (11)
RF 1981 SC1863 (24) R 1992 SC2038 (3,7)
ACT:
Constitution of India, arts. 19(1)(f), 25,
26, 27-Orissa Hindu Religious Endowments Act, 1939, as amended by Amending Act
II of 1952, ss. 38 and 89 and proviso to s. 46--Whether ultra vires the
Constitution--Section 49 of the Act--Whether ultra vires art. 27.
HEADNOTE:
Held, that ss. 38 and 39 and the proviso to
s. 46 of the Orissa Hindu Religious: Endowments Act, 1939 as amended by the
Amending Act II of 1952 are ultra vires arts. 19(1) (f), 25 and 26 of the
Constitution.
The annual contribution provided in s. 49 of
the Act is in the nature of a fee and not a tax and therefore it was within the
competence of the Provincial Legislature to enact such a provision. Further an
imposition like this is not hit by art. 27 of the Constitution because the
object of the contribution under s. 49 is not the fostering or preservation of
the Hindu religion or of any denomination within it but the proper
administration of religious trusts and institutions wherever they exist.
Civil Appeal No. 38 of 1953 referred to.
ORIGINAL JURISDICTION:Petition No. 405 of
1953.
Under article 32 of the Constitution of India
for the enforcement of Fundamental Rights and APPELLATE JURISDICTION: Case No.1
of 1950 1047 Appeal under section 205 of the Government of India Act, 1935,
from the Judgment and Decree, dated the 13th September, 1949, of the High Court
of Judicature, Orion, in First Appeal No. 39 of 1949 arising out of the
Judgment and Decree, dated the 11th September, 1945, of the Court of the
District Judge, Cutback, in Original Suit No. 3 of 1943.
N. C. Chattanooga (B. K. Saran and B. C.
Pratt, with him) for the petitioners and appellants Nos. 1 to 13.
S. P. Sinclair (B. K. Saran and R. C. Pratt,
with him) for appellants 14 to 16.
M. C. Seth (G. N. Jose, with him) for
respondents in both the matters. Agent R. H. Debar.
1954. March 16. The Judgment of the Court
was.
delivered by MUKHERJEA J.-These two connected
matters are taken up together for the sake of convenience and may be disposed
of by one and the same judgment. Petition ;No. 405 of 1953 has been presented
to this court under article 32 of the Constitution and the petitioners are the
Mahants or superiors of two ancient and well known religious institutions of
Orissa, both of which have endowments of considerable value situated within and
outside the Orissa State. An Act, known as the .Orissa Hindu Religious
Endowments Act was passed by the Orissa Legislative Assembly functioning under
the Government-of India Act, 1935. in the year 1939 and it received the assent
of the GovernorGeneral on the 31st August, 1939. The object of the Act, as
stated in the preamble, is "to provide for the better administration and
governance of certain Hindu religious endowments" and' the expression
"religious endowment" has been defined comprehensively in the Act as
meaning all property belong to or given or endowed for the support of Maths or
temples or for the performance of any service or charity connected therewith.
The whole scheme of the Act is to vest the control and supervision of public
temples and Maths in a statutory authority designated as the Commissioner of
Hindu Religious Endowments and to confer 1048 upon him certain powers with a
view to enable him to exercise effective control over the trustees of the Maths
and the temples. The Commissioner is required to be a member of the Judicial or
Executive Service of the Province and his actions are subject to the general
control of the provincial Government. For the purpose, of meeting the expenses
of the Commissioner and his staff, every Math or temple, the annual income of
which exceeds Rs. 250, is required under section 49 of the Act to pay an annual
contribution at certain percentage of the annual income which increases I
progressively with the increase in the income. With this contribution as well
as loans and grants made by the Government, a special fund is to be constituted
as provided by section 50 and the expenses of administering the religious
endowments are to be met out of this fund.
In July, 1940, a suit, out of "which the
Case No. 1 of 1950 arises, was instituted in the court of the District Judge of
Cuttack by a number. of Mahants including .the two petitioners in the petition
under article 32 before us.
-praying for a declaration that the Orissa
Relig ious Endowments Act of 1939 was ultra vires the Orissa Legislature and
for other consequential reliefs. The validity of the Act was challenged
substantially on three grounds, namely, (1) that the subject matter of
legislation was not covered by Entry 34 of List 11 in Schedule VII of the
Government of India Act, 1935 ; (ii) that the, contribution levied under,
section 49 was, in substance, a tax and could not have been imposed by the
Provincial Legislature; and (iii) that as the provisions of the Act affected
the income of properties situated outside the territorial limits of the
Province, the Act was extraterritorial in its operation and hence inoperative.
All these contentions were overruled by, the District Judge of Cuttack, who by
his judgment dated the 11 th September, 1945, dismissed the plaintiffs' suit.
Against that decision, an appeal was taken by the plaintiffs to the High Court
-of Orissa and the appeal was heard by a Division Bench, consisting of
Jagannedbadas and Narasimham JJ. The learned Judges by two separate but
concurring judgments, dated the 13th September. 1949, affirmed the decision
1049 of the District Judge and dismissed the appeal. it is against this
judgment that Case No. 1 of 1950 has come to this court.
During the pendency of the appeal in this
court the Constitution came into force on the 26th January , 1950, with its
chapter on fundamental rights, and the Orissa Hindu Religious Endowments Act
also has been amended recently by the State Legislature of Orissa by Amending
Act II of 1952.
In view of these changes, the present
application under article 32 of the Constitution has been filed by two of the
Mahants who figured as plaintiffs in the Declaratory Suit of 1940 and the application
has been framed comprehensively so as to include all points that could be urged
against the validity of the Orissa Hindu Religious Endowments Act on the basis
of the provisions of the Constitution. It is conceded by both the parties that
in these circumstances it is not necessary for us to deal separately with the
appeal. The decision, which we would arrive at in the petition under article
32, will be our pronouncement on the validity or otherwise of the different
provisions of the impugned Act.
It may be stated at the beginning that the
Orissa Hindu Religious Endowments Act of 1939 follows closely the pattern of
the Madras Hindu Religious Endowments Act of 1927 which has been now replaced
by a later Act passed by the State Legislature of Madras in 1951 and described
as the Madras Hindu Religious and Charitable Endowments Act. The grounds upon
which the validity of the Orissa Act has been attacked before us are
substantially the same as were urged in assailing the constitutional validity
of the Madras Act, in Civil Appeal No. 38 of 1953 (The Commissioner, Hindu
Religious Endowments, Madras v. Sri Lakshmindra Thirtha Swamiar), the judgment
in which has just been delivered.
The grounds urged can be classified
conveniently under two heads. In the first place, some of the provisions of the
impugned Act have been challenged as invalid on the ground that they invade the
fundamental rights of the petitioners guaranteed under articles 19(1) (f), 25
26, and, 27 of the Constitution. The other branch of the contention (1) [1954]
S.C.R. 1005.
1050 relates to.. the provision for levying
contribution on religious institutions under section 49 of the Act and this
provision has been impeached firstly on the ground that the contribution being
in substance a tax, it was beyond the competency of the Provincial Legislature
to enact any such provision. The other ground raised is, that the payment of
such tax or imposition is prohibited by article 27 of the Constitution.
The general questions relating to the scope
and ambit of the fundamental rights embodied in articles 19 (1) (f ), 25, 26
and 27 of the Constitution in connection with Maths and temples have been
discussed fully in our judgment in the Madras appeal referred to above and ,it
would not, be necessary to reiterate these discussions for purposes of the
present case. We can straightaway proceed to examine the different provisions
of the Act to which objections have been taken by the learned counsel appearing
for, the petitioners in the light of the principles which this court has laid
down in the Madras appeal. It may be said that many of the impugned provisions
of the Orissa Act correspond more or less. to similar provisions in the Madras
Act.
Section 11 of the Act has been objected to on
the ground that it vests almost , an uncontrolled and arbitrary power upon the
Commissioner. This section corresponds to section 20 of the Madras Act and as
has been pointed out in our Judgment, in the Madras appeal, the powers, though
seemingly wide, can be exercised only to ensure that Maths and temples are
properly maintained and the endowments are properly administered. As the object
and purpose for which these powers could be exercised have been indicated precisely
we do not think that it, could be said that the authority vested in the
Commissioner is in any way arbitrary.or unrestricted. The explanation attached
to the section only makes it clear that the general power conferred upon the
Commissioner extends to passing of interim orders as the Commissioner might
think fit. Section 14 lays down the duties of the trustee and the care which he
should exercise in the management 1051 of the affairs of the religious
institutions. The care, which he has to exercise, is What is demanded normally
of every -trustee in charge of trust estate and the standard is that of a man
of ordinary prudence dealing with his own funds or properties. This is a matter
relating to the administration of the estate and does not interfere with any
fundamental rights of the trustee. For the same reason, we think, no objection
could be taken to the provision of section 28 which lays down that the trustee
of a temple shall be bound to obey all orders issued under the provisions of
the Act by the Commissioner.. if the orders are lawful and made in pursuance of
authorityproperly vested in-the officer, no legitimate ground could be urged
for not complying with the orders. The sections of the Act, to which serious
objections have been taken are sections 38, 39, 46, 47 and 49. Sections 38 and
39 relate to the framing of a scheme. A scheme can certainly be settled to
ensure due administration of the endowed property but the objection seems to be
that the Act -provides, for the framing. of a scheme not by a civil Court or
under its supervision but by the Commissioner who is a mete administrative or
executive officer. There is also no provision for appeal against his order to
the court. Under section 58 of the Madras Act, although the scheme is to be
framed by the Deputy Commissioner, an appeal lies against his order to the
Commissioner in the first place. A party aggrieved by the order of the
Commissioner again has a right of suit in the ordinary civil court, with a
further right of appeal to the High Court. It seems that sub-section (4) of
section 39 of the impugned Act, as it originally stood, allowed the, trustee or
any person having an interest in the institution to file a suit in a civil
court to modify or set aside an order framing a scheme; and under section 40,
the order made under section 39 could be final only subject to the result of
such suit. Subsection (4) of section 39, however, was deleted by the Amending
Act of 1952, and under the new subsection (4), the order passed by the
Commissioner has been made final and conclusive. Strangely, however, section 41
of the Act has still been retained in its 1052 original shape and that speaks
of an order settling a scheme being set aside or modified by the court.
Obviously, this is careless drafting and the Legislature did not seem to have
adverted to the apparently contradictory provisions that it made. The learned
Attorney-General, appearing for the State of, Orissa, has also conceded that
these sections require redrafting. We think that the settling of a scheme in
regard to a religious institution by an executive officer without the
intervention of any judicial -tribunal amounts to an unreasonable restriction
upon the right of property of the superior of the religious institution which
is blended with his office. Sections 38 and 39 of -the Act must, therefore, be
held to be invalid.
There is nothing wrong in the provision of
section 46 itself but legitimate exception, we think, can be taken to the
proviso appended to the section. Under the law, as it stands, the Mahant or the
superior of a Math has very wide powers of disposal over the surplus income and
the only restriction that is recognised is that he cannot spend the income for
his own personal use unconnected with the dignity of his office. The purposes
specified in section 46 are all conducive to the benefit of the institution and
there is no reason why the discretion of the trustee in regard to the spending
of surplus for such purposes also should be still further restricted by
directions which the Commissioner may choose to issue. Section 47 (1) lays down
how the rule of cy pres is to be applied not merely when the original purpose
of the trust fails or becomes incapable of being carried out either in whole or
in part by reason of subsequent events, but also where there is a surplus left
after meeting the legitimate expenses of the institution. Objection apparently
could be raised against the last provision of the sub-section, but as
subsection(4) of section47gives the party aggrieved by any order of the
Commissioner in this respect to file a suit in a civil court and the court is
empowered to modify or set aside such order of the Commissioner, we do not
,think that there is any reasonable ground for complaint.
The only other section that requires
consideration is sect ion 49 under which every Math or temple having 1053 an
annual income exceeding Rs. 250 has got to make an annual contribution for
meeting the expenses of the Commissioner and the officers and servants working
under him. The first question that arises with regard to this provision is
whether the imposition is a tax or a fee; and it is not disputed that if it is
a tax, the Provincial Legislature would have no authority to enact such a
provision. This question has been elaborately discussed in our judgment in the
Madras appeal referred to above and it is not necessary to repeat the
discussions over again. As has been pointed out in the Madras appeal, there is
no generic difference between a tax and a fee and both are different forms in
which the taxing power of a State manifests itself. Our Constitution, however,
has made a distinction between a tax and a fee for legislative purposes and
while there are various entries in the three lists with regard to various forms
of taxation, there is an entry at the end of each one of these lists as regards
fees which could be levied in respect of every one of the matters that are
included therein. A tax is undoubtedly in the nature of a compulsory exaction
of money by a public authority for public purposes, the payment of which is
enforced by law. But the essential thing in a tax is that the imposition is
made for public purposes to meet the general expenses of the State without
reference to any special benefit to be conferred upon the payers of the tax.
The taxes collected are all merged in the general revenue of the State to be
applied for general public purposes. Thus, tax is a common burden and the only
return which the taxpayer gets is the participation in the common benefits of
the State. Fees, on the other hand, are payments primarily in the public
interest but for some special service rendered or some special work done for
the benefit of those from whom payments are demanded. Thus in fees there is
always an element of quid pro quo which is absent in a tax. Two elements are
thus essential in order that a payment may be regarded as a fee. It the first
place,, it must be levied in consideration of certain services which the
individuals accepted either willingly or unwillingly. But this by itself is not
enough to make 136 1054 the imposition a fee, if the payments demanded for
rendering of such services are not set apart or specifically appropriated for
that purpose but are merged in the general revenue of the State to be spent for
general public purposes. Judged by this test, the contribution that is levied
by section 49 of the Orissa Act will have to be regarded as a fee and not a
tax. The payment is demanded only for the purpose of meeting the expenses of
the Commissioner and his office which is the machinery set up for due
administration of the affairs of the religious institution. The collections
made are not merged in the general public revenue and are not appropriated in
the manner laid down for appropriation of expenses for other public purposes.
They go to constitute the fund which is contemplated by section 50 of the Act
and this fund, to which also the Provincial Government contributes both by way
of loan and grant, is specifically set apart for the rendering of services
involved in carrying out the provisions of the Act. We think, therefore, that
according to the Principles which this court has enunciated in the Madras
appeal mentioned above, the contribution could legitimately be regarded as fees
and hence it was within the competence of the Provincial Legislature to enact
this provision. The fact that the amount of levy is graded according to the
capacity of the payers though it gives it the appearance of an income-tax, is
not by any means a decisive test.
We are further of opinion that an imposition
like this cannot be said to be hit by article 27 of the Constitution.
What is forbidden by article 27 is the
specific appropriation of the proceeds of any tax in payment of expenses for
the promotion or maintenance of any particular religion or religious
denomination. The object of the contribution under section 49 is not the
fostering or preservation of the Hindu religion or of any denomination within
it; the purpose is to see that religious trusts and institutions wherever they
exist are properly administered.
It is the secular administration of the religious
institutions that the Legislature seeks to control and the object, as
enunciated in the Act, is to ensure that the endowments attached to the
religious institutions are properly administered and their income is duly
appropriated for purposes for which they were founded or exist. As there is no
question of favouring any particular religion or religious denomination,
article 27 could not possibly apply.
The result is that, in our opinion, the only
sections of the Act, which are invalid, are sections 38, 39 and the proviso to
section 46. The application under article 32 is, therefore, allowed to this
extent that a writ in the nature of mandamus would issue restraining the Commissioner
and the State Government enforcing against the petitioners the provisions of
-the sections mentioned above. The other prayers of the petitioners are
disallowed. No separate order is necessary in Case No. I of 1950, which will
stand dismissed. We make no order as to costs either in the petition or in the
appeal.
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