Corporation of Calcutta Vs. Calcutta
Tramways Co. Ltd. [1963] INSC 200 (4 October 1963)
04/10/1963 WANCHOO, K.N.
WANCHOO, K.N.
GAJENDRAGADKAR, P.B.
SUBBARAO, K.
SHAH, J.C.
DAYAL, RAGHUBAR
CITATION: 1964 AIR 1279 1964 SCR (5) 25
CITATOR INFO :
RF 1969 SC 707 (45) RF 1973 SC1461 (1219) RF
1981 SC 818 (22) R 1989 SC1949 (10)
ACT:
Constitution of India, Art. 19(1) (g) and
(f)--Enactment making opinion of Corporation conclusive and non- justiciable If
reasonable restriction--Severability--Calcutta Municipal Act, 1951 (W.B. Act 33
of 1951), s. 437(1) (b).
HEADNOTE:
The respondent company got its supply of
electricity from the Calcutta Electric Supply Co., converted the same from
alternate current to direct current in its transformer house for running its
tram-cars. The appellant Corporation was of opinion that the use of the
premises as transformer house was dangerous to life, health and property and
was likely to cause a nuisance and asked the respondent to take a licence under
s. 437(1)(b) of the Calcutta Municipal Act, 1951. The respondent refused to do
so and was therefore prosecuted under s. 537 of the Act. The trial Magistrate
held in favour of the appellant and convicted the respondent and sentenced it
to pay a fine of Rs. 100 only. The respondent moved 26 the High Court in
revision. That Court held that the provision in s, 437(1) (b) which made the
opinion the Corporation conclusive and non-justiciable unreasonably restricted
the fundamental right enshrined in Art. 19(1) (g) of the Constitution and since
that provision was in severable the entire section was unconstitutional. The
corporation appealed to this Court. Section 437(1)(b) of the Act provided as
follows' "(1) No person shall use or permit or suffer to be used any
premises for any of the following purposes without or otherwise than in
conformity with the terms of a licence granted by the Commissioner in this
behalf, namely,-- (a) (b) any purpose which is, in the opinion of the
Corporation (which opinion shall be conclusive and shall not be challenged in
any court) dangerous to life, health or property, or likely to create a
nuisance." Held: The power conferred on the Corporation by s. 437(1)(b) of
the Calcutta Municipal Act, 1951, in the parenthetical clause "which
opinion shall be conclusive and shall not be challenged in any court"
which was in the nature of a procedural provision, was an unreasonable
restriction within the meaning of Art. 19(6) of the Constitution and must be
struck down. The clause makes the opinion of the Corporation, however
unreasonable, capricious and arbitrary, conclusive and non-justiciable and
thereby places trade and business within the municipal limits entirely at the
mercy of the Corporation, even though it may not act mala fide.
The decision of this Court in Joseph
Kuruvilla Vellukunnel v. Reserve Bank of India, must be confined to the special
circumstances of the trade of banking and cannot be extended as a matter of
course to other cases involving substantially similar provisions and each case
should be judged on its own merits.
Joseph Kuruvilla Vellukunnel v. The Reserve
Bank of India, [1962] Supp. 3 S.C.R. 632, held inapplicable.
So judged in the light of the principles laid
down by this Court, the parenthetical clause was severable from the rest of the
section and, consequently, that clause alone, and not the entire section should
be struck down. The scheme of the section was not so integrated as to indicate
that the Legislature wanted it to be operative as a whole.
Dr. N.B. Khare v. State of Delhi, [1950] S.C.R.
519 and R.M.D. Chamarbaugwalla v. Union of India, [1957] S.C.R.
930, relied on.
CRIMINAL APPELLATE JURISDICTION: Criminal
Appeal No.
117 of 1961.
27 Appeal from the judgment and order dated
March 21, 1960', of the Calcutta High Court in Criminal Revision No. 376 of
1957.
A.N. Sinha and P.K. Mukherjee, for the
appellant M.C. Setalvad, Sukumar Ghose and B.N. Ghosh, for the respondent.
October 4, 1963. The Judgment of the Court
was delivered by WANCHOO J.--This is an appeal on a certificate granted by the
Calcutta High Court. The respondent, the Calcutta Tramways Co. Ltd., is running
tramcars in the city of Calcutta. It gets electricity in bulk from the Calcutta
Electric Supply Company and gets the same converted from alternate current to
direct current at a high voltage for electric traction for running tram-cars of
the company. For this purpose it has an electric transformer house in 129/4-A
and 130-D, Cornwallis Street. The appellant Corporation was of opinion that the
premises were being used for a purpose which was dangerous to life, health or
property and was likely to create a nuisance. It therefore ordered the
respondent to take out a licence under s. 437 (1) (b) of the Calcutta Municipal
Act, No. XXXIII of 1951, (hereinafter referred to as the Act) and fixed a fee
therefore. The respondent however refused to take out a licence and
consequently it was prosecuted under s. 537 of the Act. The respondent raised a
number of points in defence, namely, (i) that the prosecution had not been
properly filed; (ii) that the electric transformer house was neither a factory
nor a place of trade, nor a place of public resort and therefore s. 437 (1) (b)
had no application; (iii) that the use of the transformer house for converting
high voltage alternate current into low and medium pressure direct current was
neither a use which was dangerous to life, health or property nor the same was
likely to create a nuisance; and (iv) that as s. 437 (1) (b) of the Act vests
absolute power in the Corporation to form the opinion required there under, it
was an unreasonable restriction on the freedom of trade 28 guaranteed under
Art. 19 (1) (g) of the Constitution and therefore that provision is
unconstitutional.
The Magistrate held that the complaint was
properly filed. He further held that the transformer house. was meant for the
trade which the respondent was carrying on and therefore was covered by s. 437
(1) (b). He also held that the Corporation had properly formed the opinion that
the use of the transformer house was likely to be dangerous to life, health or
property and was also likely to create a nuisance. He further seems to have
held that even though s.
437 (1) (b)made the opinion of the
Corporation conclusive and final, there could be no doubt that the use of the transformer
house was dangerous to life, health or property and was likely to create a
nuisance. Finally he seems to have held that s. 437 (1) (b) as it stood was not
unconstitutional. He therefore convicted the respondent and sentenced it to a
fine of Rs. 100 only.
The respondent then went in revision to the
High Court, and the main point urged there was that the provisions of s. 437
(1) (b) were unconstitutional. The High Court held that inasmuch s. 437 (1) (b)
made the opinion of the Corporation conclusive and not liable to be challenged
in any court, the provision was unconstitutional inasmuch as it amounted to an
unreasonable restriction on the fundamental right enshrined in Art. 19 (1) (g).
The High Court further held that the provision with respect to the
conclusiveness and non-justiciability of the opinion of the Corporation was so
embedded in s. 437 (1) (b) that it was not severable and therefore it struck
down s. 437 (1) (b) as a whole as unconstitutional. Another point which was
urged before the High Court was that the fee of Rs. 500 was in the nature of a
tax which neither the State Legislature nor the Corporation of Calcutta could
levy. The High Court did not decide this question in view of its decision on
the constitutionality of s. 437 (1) (b). The present appeal has been brought to
this Court by the appellant on a certificate granted by the High Court.
29 Two main questions therefore that arise
for our decision are: (1) whether the provision in s. 437 (1) (b) which makes
the opinion of the Corporation conclusive and non justiciable in any court
amounts to an unreasonable restriction on the right to carry on trade etc.
enshrined in Art. 19 (1) (g); and (2) even if it be so, whether the provision
relating to conclusiveness and non-justiciability is severable or not.
Section 437 (1) (b) reads as follows:
"(1) No person shall use or permit or
suffer to be used any premises for any of the following purposes without or
otherwise than in conformity with the terms of a licence granted by the
Commissioner in this behalf, namely,-- (a) (b) any purpose which is, in the
opinion of the Corporation (which opinion shall be conclusive and shall not be
challenged in any court) dangerous to life, health or property, or likely to
create a nuisance;
(c) The contention on behalf of the appellant
is that even though the opinion of the Corporation has been made conclusive and
non-justiciable, the restriction on trade resulting from the imposition of
licence-fee on the basis of such conclusiveness and non-justiciability is a
reasonable restriction in the interest of the general public. On the other hand
it has been urged on behalf of the respondent that by making the opinion of the
Corporation in such matters conclusive and non-justiciable, the law makes it
possible that any opinion of the Corporation, howsoever capricious or
unreasonable it may be, must prevail and therefore the provision is an
unreasonable restriction on the right to carry on any trade etc. enshrined in
Art. 19 (1) (g). Reliance in this connection has been placed on the decision of
this Court in Joseph Kuruvilla Vellukunnel v.The Reserve Bank of India.(1) It
is urged that the mere fact that the opinion of the Corporation has been made
con (1) [1962] Supp. 3 S.C.R. 632 30 clusive and non justiciable would not make
the provision unreasonable with respect to carrying on any trade etc. In that
case, s. 38 (1) of the Banking Companies Act, provided that notwithstanding
anything contained in the Companies Act, 1956, the High Court shall order the
winding up of a banking company, if an application for its winding up has been
made by the Reserve Bank under s. 37, or this section.
It was urged in that case that the provision
amounted to an unreasonable restriction on the right to carry on banking as the
whole procedure was a denial of the principles of natural justice, chiefly as
it denied access to courts, for ordinarily it was for the court to be satisfied
after a fair trial that an order of winding up a company was called for and the
court was free to. reach a decision after the company had shown cause and there
was also a right of appeal against such decision. This Court held by a majority
that in view of the history of the establishment of the Reserve Bank as a
central bank for India, its position as a banker's bank, its control over
banking companies and banking in India, its position as the issuing bank, its
power to license banking companies and cancel their licences and numerous other
powers, the provision could not be challenged as unreasonable as the Reserve
Bank makes an application for winding up only where it is satisfied that it was
necessary to wind up a tottering or unsafe banking company in the interest of
the depositors. We are of opinion that the decision in that case must be
confined to the very special circumstances of the trade of banking, which is a
very sensitive credit organisation and to the very special position the Reserve
Bank occupies in the banking world in this country. That decision cannot be
extended as a matter of course to other cases where substantially similar
provisions are made in other laws relating to exclusion of the jurisdiction of
courts. In other cases of this kind, the question has to be examined on the
merits in each case to see whether the restriction created by conclusiveness
and non-justiciability is a reasonable restriction in the circumstances of the
particular case.
31 We must therefore proceed to consider
whether in the circumstances of this case the restriction contained in the
parenthetical clause ins. 437 (1) (b) by which the opinion of the Corporation
has been made conclusive and non- justiciable, can be said to be a reasonable
restriction on the right to carry on trade etc. enshrined in Art. 19 (1) (g).
In Dr. N.B. Khare v. The State of Delhi,(1) this Court held that a law
providing reasonable restrictions on the exercise of the rights conferred by
Art. 19 may contain substantive provisions as well as procedural provisions and
the court has to consider the reasonableness of the substantive provisions as
well as the procedural part of the law. The parenthetical clause which makes
the 6pinion of the Corporation conclusive and non-justiciable is in the nature
of a procedural provision and we have to see whether in the circumstances of
this case such a procedural provision is reasonable in the interest of the
general public. It has been urged that the Corporation which is an elected body
would exercise the power conferred on it under s. 437 (1) (b) reasonably and
therefore the provision must be considered to be a reasonable provision. This
in our opinion is no answer to the question whether the provision is reasonable
or not. It is of course true that malafide exercise of the power conferred on
the Corporation would be struck down on that ground alone; but it is not easy
to prove mala fide, and in many cases it may be that the Corporation may act
reasonably under the provision but it may equally be that knowing that its
opinion is conclusive and non-justiciable it may not so act, even though there
may be no mala fides. The vice in the provision is that it makes the opinion of
the Corporation, howsoever capricious or arbitrary or howsoever unreasonable on
the face of it may be, conclusive and non-justiciable. The conferment of such a
power on a municipal body which has the effect of, imposing restrictions on
carrying on trade etc. cannot in our opinion be said to be a reasonable restriction
within the meaning of Art.
(1) [1950] S.C.R. 519.
32 19 (6). Such a provision puts carrying on
trade by those residing within the limits of the municipal Corporation entirely
at its mercy, if it chooses to exercise that power capriciously, arbitrarily or
unreasonably, though not mala fide. We therefore agree with the High Court that
the conferment of such a power on the Corporation as it stands in the
parenthetical clause in s. 437 (1),(b) must be held to be an unreasonable
restriction on the right to carry on trade etc.
This brings us to the next question whether
this parenthetical clause is severable from the rest of the provision. In this
connection it may be observed that in the Calcutta Municipal Act, 1923, which
was repealed by the Act, the corresponding provision was contained in s. 386
and there was no provision making the opinion of the Corporation conclusive and
non-justiciable. In similar provisions of other laws also there is no provision
making the opinion of the Corporation conclusive and non-justiciable. In the
Madras City Municipal Act, No. IV of 1919, there was a similar provision in s.
287 read with Sch.VI, which provided for licences where a place was used for
any purpose in any area which in the opinion of the Commissioner was likely to
be dangerous to human life or was likely to create or cause nuisance. Similarly
in the Delhi Municipal Corporation Act, No. 66 of 1957, there is a provision in
s. 417 (1) which provides that no person shall use or permit to be used any
premises for any purpose which in the opinion of the Commissioner was dangerous
to life, health or property or likely to create a nuisance. We have referred to
these Acts and the provision in the Calcutta Municipal Act which was the
predecessor of the Act to show that it is quite possible to work such a
provision without the opinion of the Corporation being made conclusive and
non-justiciable. The question therefore is whether this provision contained in
the parenthetical clause in s. 437 (1) (b) can be severed from the rest of the
provision.
33 The principles governing severability were
considered by this Court in R.M.D. Chamarbaugwalla v. The Union of India.(1)
Seven principles were there laid down in that connection, of which three are
material for our purpose, namely-- " (1) In determining whether the valid
parts of ,1. statute are separable from the invalid parts thereof, it is the
intention of the legislature that is the determining factor. The test to be
applied is whether the legislature would have enacted the valid part if it had
known that the rest of the statute was invalid.
"(2) If the valid and invalid provisions
are so inextricably mixed up that they cannot be separated from one another,
then the invalidity of a portion must result in the invalidity of the Act in
its entirety. On the other hand if they are "so distinct and separate that
after striking out what is invalid, what remains is in itself a complete code
independent of the rest then it will be upheld notwithstanding that the rest
has become unenforceable".
"(3) Even when the provisions which are
valid are distinct and separate from those which are invalid, if they all form
part of a single scheme which is intended to be operative as a whole, then also
the invalidity of a part will result in the failure of the whole." Learned
counsel for the appellant urges that the parenthetical clause in s. 437 (1)
(b)is severable in view of the first two principles set out above. On the other
hand, learned counsel for the respondent urges that in view of the third
principle the parenthetical clause with respect to conclusiveness and
non-justiciability is not severable.
The High Court has also taken the view that
even if the parenthetical clause is distinct and separate from the rest of the
provision, the whole provision contained in s. 437 (1) (b) constitutes a single
scheme intended to be operative (1) [1957] S.C.R..093 1 SCI/64--3 34 as a whole
and therefore s. 437 (1) (b) must be struck down.
We are of opinion that the view taken by the
High Court is not correct. We have already pointed out that such a provision
did riot exist in the earlier Act relating to this very Corporation and it is
no one's case that without such provision the earlier provision did not work.
The first question therefore is whether it was the intention of the legislature
when it passed s. 437 (1) (b) that if it knew that the parenthetical clause was
invalid it would not have enacted the rest of s. 437 (1) (b). The answer to
this question in our opinion can only be one. In view of the corresponding
provision in the Calcutta Municipal Act, 1923, we cannot accept that the
Legislature would not have provided for the licensing of premises which in the
opinion of the Corporation were used for purposes which were dangerous to life,
health or property or were likely to create a nuisance, unless that opinion was
to be conclusive and non-justiciable. Similar provision had existed in the
earlier law without the provision relating to conclusiveness and
non-justiciability in respect of using premises for purposes which were
dangerous to life health or property or were likely to create a nuisance. Such
a provision in our opinion is a very reasonable provision in the interest of
the general public and we do not see why it should be held that the Legislature
would not have enacted such a provision unless the opinion of the Corporation
was also to become conclusive and non-justiciable. The first proposition out of
the three set out above is in our opinion clearly applicable to this case and
we have no doubt that the Legislature would have enacted the provision
contained in s. 437 (1) (b) without the parenthetical clause.
So far as the second principle is concerned,
we are of opinion that the valid and invalid provisions in s. 437 (1) (b) are
not so inextricably mixed that they cannot be separated. On the other hand we
are of opinion that they are distinct and separate 35 and even if we strike out
the parenthetical clause as to conclusiveness and non-justiciability what
remains is in itself a complete code for the particular purpose independent of
the invalid part. Therefore, the remaining provision contained in s. 437 (1)
(b) can and should be upheld notwithstanding that the parenthetical clause
providing for conclusiveness and non-justiciability is invalid.
Finally we are of opinion that the third
proposition does not apply in the present case. That proposition applies only
where the valid and the invalid provisions even when they are separate and
distinct form part of a single scheme which is intended to be operative as a
whole;if that is really so, then the whole must go and there is no question of
severability. But making a certain opinion conclusive and non-justiciable is a
separate matter altogether and it cannot be said that it is so embedded in s.
437 (1) (b) as to make conclusiveness and non- justiciability of the opinion of
the Corporation a part of the scheme for licensing which is provided therein.
As we read s. 437 (1) (b) it cannot be said that the whole of it is a part of a
single scheme which was intended to be operative as one whole. This is really
another aspect of the first proposition relating to the intention of the
Legislature and it seems to us that the scheme in s. 437 (1) (b) is not such a
single scheme that it must be said that the Legislature must have intended it
to be operative as a whole. We see no difficulty in holding that the provision
in the parenthetical clause cannot be said to be part of a single scheme of
such a nature that either the whole must be operative or nothing at all. We are
therefore of opinion that the parenthetical clause consisting of the words
"which opinion shall be conclusive and shall not be challenged in any
court" is severable from the rest of s. 437 (1) (b) and therefore only
these words of this section can be struck down and not the whole of the
section. It may be added that the respondent does not rely on any of the
remaining principles set out in R.M.D. Chamar baug walla's case.(1) (1) [1957]
S.C.R. 930.
36 The order of the High Court striking down
the whole of s. 437 (1) (b) must therefore be set aside and only the portion in
parenthesis which makes the opinion of the Corporation conclusive and
non-justiciable struck down as an unreasonable restriction' on the right to
carry on trade etc. under Art. 19 (1) (g).
In the view we have taken the judgment of the
High Court must be set aside. It has been urged on behalf of the respondent
that as the Magistrate dealt with the matter on the looting that the opinion of
the Corporation was conclusive and non-justiciable it should be given an
opportunity to show before the Magistrate that the opinion of the Corporation
that the purpose for which the premises in this case were used was dangerous to
life, health or property or was likely to create a nuisance was wrong. It is
also urged that the point whether the impost in this particular case was a fee
properly so called or a tax which was taken before the High Court arises in
this case and opportunity should be given to the respondent to raise this point
before the Magistrate. In view of this contention we set aside the order of the
Magistrate also and remand the case to him for decision according to law,
including the above two points. The parties will be at liberty to adduce such
relevant evidence as they think fit to do.
Case remanded.
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