Union of India Vs. State of Rajasthan
[1984] INSC 166 (4 September 1984)
VENKATARAMIAH, E.S. (J) VENKATARAMIAH, E.S.
(J) REDDY, O. CHINNAPPA (J) SEN, A.P. (J)
CITATION: 1984 AIR 1675 1985 SCR (1) 700 1984
SCC (4) 238 1984 SCALE (2)314
ACT:
Constitution of India-Article 131-Original
jurisdiction of the Supreme Court-Scope of-Jurisdiction when attracted.
Held: attracted only when dispute arises
between or amongst the States and the Union of India in the context of the
constitutional relationship that exists between them and the powers, rights,
duties, immunities, liabilities, disabilities, etc., flowing there from.
Whether a suit filed by the State against the Union of India for recovery of
compensation for loss on account of damage caused to goods dispatched through
the Indian Railways could be filed in a civil court-Whether suit Maintainable.
Held: yes.
Indian Railways Act, 1890-Section 80-Suit
filed under section 80 is one between Railway Administration and the person
instituting the suit even though Union of India is impleaded as a party.
HEADNOTE:
The respondent, State of Rajasthan through
its District Rehabilitation Officer, Barmer filed a suit in the court of the
District Judge, Balotra against the appellant, Union of India, and the Railway
Administration claiming damages for the loss suffered by it on account of the
damage caused to the goods transported by rail through the Railway
Administration. The appellant contended that the suit was not maintainable in
the District Court in view of Article 131 of the Constitution which, according
to it conferred exclusive jurisdiction on the Supreme Court to decide all
disputes arising between a State and the Union. The District Judge held that he
had jurisdiction to try the suit. A Revision Petition filed against the order
of the District Judge was dismissed by the High Court. Hence this petition for
special leave to appeal.
Dismissing the petition, ^ HELD: The suit was
entertainable by the District Court.
On a careful consideration of the whole
matter in the light of the decisions of this Court, it is felt that Article 131
of the Constitution is attracted only when a dispute arises between or amongst
the States and the Union in the context of the constitutional relationship that
exists between them and the powers, rights, duties.
immunities, liabilities, disabilities etc.
flowing there from. Any dispute 701 which may arise between a State in the
capacity of an employer in a factory, a manufacturer of goods subject to
exercise duty, a holder of a permit to run a stage carriage, a trader or
businessman carrying on business not incidental to the ordinary functions of
Government, a consumer of railway services etc. like any other private party on
the one hand and the Union of India on the other cannot be construed as a
dispute arising between the State and the Union in discharge of their
respective executive powers attracting Article 131 of the Constitution. It
could never have been the intention of the framers of the Constitution that any
ordinary dispute of this nature would have to be decided exclusively by the
Supreme Court. [708G-H; 709A-B] State of Bihar v. Union of India & Anr.,
[1970] 2 S.C.R. 522, Union of India v. State of Mysore, [1977] S.C.R. 842.
State of Mysore v. Union of India & Ors. A.I.R. 1968 Mysore 237 at pages
239-240, State of Rajasthan & Ors., etc.
v. Union of India etc. etc., [1978] 1 S.C.R.
1, State of Karnataka v. Union of India & Anr., [1978] 2 S.C.R. 1 at page
92 and The Framing of India's Constitution-A Study by Shri B. Shiva Rao at page
483, referred to.
In the instant case, the State Government has
made a claim like any other consignee of goods despatched through the railway
for compensation and its success or failure in the suit depends on proof of
facts which have to be established in the same way in which a private person
would have to establish. This is not even a case where a formal contract is
entered into between the Union of India and the State of Rajasthan is
accordance with the requirements of Article 299 of the Constitution. It is just
a commercial contract under which an officer of the State of Rajasthan was
entitled to claim delivery of the goods consigned as any ordinary consignee.
The claim involved in this case is one based on section 80 of the Indian
Railways Act, 1890.
Section 80 of the Indian Railways Act, 1890
indicates that the claim made under it is essentially against the Railway
Administration concerned. The Union of India is impleaded as a party to suits
instituted thereunder being the owner of the Indian Railways by virtue of
Article 300 of the Constitution. The statute, however, treats the dispute as
one between the Railway Administration concerned and the person instituting the
suit. Neither of the parties to these proceedings is questioning the
applicability of the provisions of the Indian Railways Act, 1890 to these
proceedings. It is, therefore, difficult to hold that in these proceedings
there is any question which falls within the scope of Article 131 of the
Constitution.
[709H; 710A-B; D; H; 711A-B]
CIVIL APPELLATE JURISDICTION: Special Leave
Petition (Civil) No. 284 of 1982.
From the Judgment and Order dated the 2nd
September 1981 of the Rajasthan High Court in Civil Revision Petition No. 273
of 1981 K.G. Bhagat, Addl. Sol General, Miss A. Subhashini and Vijay Panjwani
for the Petitioners.
702 The Judgment of the Court was delivered
by VENKATARAMIAH, J. The precise question which arises for consideration in
this petition is whether a suit filed by the State of Rajasthan against the
Union of India for recovery of compensation for loss on account of the damage
caused to the goods despatched through the Indian Railways in a civil court at
Rajasthan is maintainable or whether it should be filed in this Court under
Article 131 of the Constitution.
The facts of the case are these. The District
Administrator of Baarmer in Rajasthan was in need of a certain number of tents
and their accessories and at his request 170 bundles of tents and their
accessories were despatched by Chief Commandant, Mana Shivir (Raipur) Madhya
Pradesh to the Collector, Barmer through the Indian Railways under R.R. No.
423978 dated February 17, 1972 to be delivered at Barmer. No intimation was
received about the arrival of the consignment at Barmer till August 6,1972. On
hearing that the consignment had reached Barmer on August 6, 1972, the
Additional Collector and the District Rehabilitation Officer went to Barmer on
August 6, 1972 for taking delivery but it was found that the packings of the
goods had been seriously damaged and as a consequence thereof the tents as well
as the accessories had become unfit for use. The delivery was not, therefore,
taken and a request was made for assessing the damages. The goods were
auctioned and a sum of Rs. 15,000 was fetched in the auction. Since the claim
of the consignee was not settled by the Railway Administration, after issuing
necessary notice to the General Manager, Northern Railway, New Delhi, a suit
was filed by the State of Rajasthan through the District Rehabilitation Officer
Barmer claiming damages amounting to Rs. 1, 57,825.80 against the Union of
India in the Court of the District Judge, Balotra on July 23,1977. The suit was
contested by the Union of India and the Railway Administration on various
grounds and one of them was that the suit was not maintainable in the District
Court in view of Article 131 of the Constitution which according to them
conferred exclusive jurisdiction on the Supreme Court to decide all disputes
arising between a State and the Union.
The 6th issue framed in the suit related to
the competence of the District Court to entertain the said suit. The above
issue was heard as a preliminary issue and the District Judge held by his order
dated April 16, 1981 that he 703 had jurisdiction to try the suit. Against the
order of the District Judge a revision petition was filed before the High Court
of Rajasthan and that petition came to be dismissed on September 2,1981. This
petition for Special Leave is preferred under Article 136 of the Constitution
against the order of the High Court.
After the case was heard for some time, the
learned Additional Solicitor General very fairly stated that the suit could be
allowed to be proceeded with before the District Court. Since the question was
of importance and that every suit instituted by any State Government against
the Railway Administration may give rise to a similar issue, we propose to
dispose of this Special Leave Petition with our reasons.
Article 131 of the Constitution reads thus:
"131. Subject to the provisions of this
Constitution, the Supreme Court shall, to the exclusion of any other court have
original jurisdiction in any dispute- (a) between the Government of India one
or more States; or (b) between the Government of India and any State or States
on one side and one or more other States on the other; or (c) between two or
more States if and in so far as the dispute involves any question (whether of
law or fact) on which the existence or extent of a legal right depends:
Provided that the said jurisdiction shall not
extend to a dispute arising out of any treaty, agreement, covenant, engagement,
sanad or other similar instrument which, having been entered into or executed
before the commencement of this Constitution, continues in operation after such
commencement, or which provides that the said jurisdiction shall not extend to
such a dispute." The provision corresponding to Article 131 of the
Constitution in the Government of India Act, 1935 was section 204 of that Act.
That section prior to its amendment by the India (Provisional Constitution)
Order, 1947, read as:
704 "204. Original jurisdiction of
Federal Court. (1) Subject to the provisions of this Act, the Federal Court
shall to the exclusion of any other court, have an original jurisdiction in any
dispute between any two or more of the following parties, that is to say, the
Federation, any of the provinces or any of the Federated States, if and in so
far as the dispute involves any question (whether of law or fact) on which the
existence or extent of a legal right depends:
Provided that the said jurisdiction shall not
extend to- (a) a dispute to which a State is a party, unless the dispute- (i)
concerns the interpretation of this Act or of an Order in Council made there under,
or the extent of the legislative or executive authority vested in the
Federation by virtue of the Instrument of Accession of that State;
or (ii) arise under an agreement made under
Part VI of this Act in relation to the administration in that States of a law
of the Federal Legislature, or otherwise concerns some matter with respect to
which the Federal Legislature has power to make laws for that State; or
(iii)arises under an agreement made after the establishment of the Federation,
with the approval of His Majesty's Representative for the exercise of the
functions of the Crown in its relations with Indian States, between that State
and the Federation or a Province, being an agreement which expressly provides
that the said jurisdiction shall extend to such a dispute, (b) a dispute
arising under any agreement which expressly provides that the said jurisdiction
shall not extend to such a dispute.
(2) The Federal Court in the exercise of its
original jurisdiction shall not pronounce any judgment other than a declaratory
judgment." 705 It may be noted that while the main part of sub-section (1)
of section 204 of the Government of India Act, 1935 is more or less similar to
Article 131 of the Constitution, there is a difference between the structure of
the proviso to Article 131 and the structure of the proviso to section 204 (1).
Article 131 of the Constitution provides that subject to the provisions of the
Constitution, the Supreme Court shall to the exclusion of any other Court, have
original jurisdiction in any dispute-(a) between the Government of India and
one or more States; or (b) between the Government of India and any State or
States on one side and one or more other States on the other; or (c) between
two or more States, if and in so far as the dispute involves any question
(whether of law or fact) on which the existence or extent of a legal right
depends. That means that if there is any dispute involving any question about
the existence of a legal right or even where the existence of legal right is
admitted if there is a dispute about its scope between or amongst the States
and the Government of India as stated therein, the Supreme Court would have
exclusive jurisdiction to decide the question whether of law or fact. No other
court has jurisdiction to deal with it. Similarly under section 204 of the
Government of India Act, 1935 the Federal Court had exclusive jurisdiction to
decide similar questions which arose between or amongst the Federation, any of
the Provinces or any of the Federated States. Under the proviso to that
section, however, it was provided that the said jurisdiction would not extend
to dispute to which a State (a Federated State) was a party, unless the dispute
concerned matters mentioned in clauses (i) to (iii) thereof. Under the proviso
to Article 131 of the Constitution the original jurisdiction of the Supreme
Court does not extend to matters referred to therein. In the State of Bihar v.
Union of India & Anr. after reviewing the constitutional history which led
to the enactment of Article 131 of the Constitution, a Constitution Bench of
this Court observed at pages 529-530 thus:
"Although Art. 131 does not define the
scope of the disputes which this Court may be called upon to determine in the
same way as section 204 of the Government of India Act, and we do not find it
necessary to do so, this much is certain that the legal right which is the
subject of dispute must arise in the context of the Consti- 706 tution and the
Federation it sets up. However, there can be no doubt that so far as the
parties to the dispute are concerned, the framers of the Constitution did
intend that they could only be the constituent units of the Union of India and
the Government of India itself arrayed on one side or the other either singly
or jointly with another unit or the Government of India." (Underlining by
us) The Constitution Bench ultimately held in; the above case that if a private
person, firm or corporation was also impleaded as a party the dispute could not
be tried by the Supreme Court under Article 131 of the Constitution.
In Union of India v. State of Mysore, the
question was whether a writ petition filed in the High Court by a State against
the Union of India questioning the correctness of the order of the Central
Government passed on a revision petition filed under the Central Excises and
Salt Act, 1944 rejecting the contention of the State Government against the
levy of excise duty on goods in stock with the state's Implements Factory was
maintainable. The High Court held that the Central Government being a Tribunal
as such while disposing of the revision petition in the exercise of power
conferred on it by Section 36 of the Central Excises and Salt Act, 1944 could
not be a disputant in the dispute it decided. The Central Government was only
interested in the recovery of duty which was properly payable but that by
itself did not transform it from a Tribunal into a disputant. The High Court
observed that:
"A dispute falls within Article 131 of
the Constitution only when the Central Government is a disputant as such. The
dispute must directly arise between the State and the Central Government as the
repository of the executive power of the Union. An indirect interest in the
collection of the revenue in the form of excise duty if the excise duty
demanded by the Central Excise is exigible, is far too slender a foundation for
the postulate that in every controversy arising under the provisions of the
Central Excise Act the Central Government is necessarily a disputant. The
acceptance of such interpretation would make the Central Government a party to
every proceeding under the Central 707 Excise Act in the role of a disputant,
and, that consequence can scarcely fit into its constitution as a tribunal
under section 36 of the Act." (Vide State of Mysore. v. Union of India
& Ors.
Accordingly the contention raised by the
Union of India was negatived by the High Court. This Court affirmed the above
view of the High Court in the case of Union of India v. State of Mysore (supra)
at page 845 thus:
"Mr. Raman tried to argue that the High
Court erred in not applying article 131 of the Constitution to the controversy
even though the writ petition was barred thereunder as it fell exclusively
within the jurisdiction of this Court under article 131 of the Constitution as
a dispute between the Government of India and the State of Mysore. The argument
is however futile because there is nothing on the record to show that there was
any such dispute between the Central and the State Government. As the High
Court has pointed out, the Union of India was made a party to the writ petition
merely because it had dismissed the revision application of the State
Government." In State of Rajasthan & Ors. etc. etc. v. Union of India
etc. etc. while explaining the scope of Article 131 of the Constitution
Chandrachud, J. (as he then was) said at page 54:
"The dispute between the Union of India
and a State cannot but be a dispute which arises out of the differences between
the Government in office at the Centre and the Government in office in the
State. 'In office' means 'in power' but the use of the latter expression may
prudently be avoided with the realization of what goes with power. But there is
a further prerequisite which narrows down the ambit of the class of dispute
which fall within Art. 131. That requirement is that the dispute must involve a
question whether of law or fact, on which the existence or extent of a legal
right depends. It is this qualification which affords the true guide for
determining whether a particular 708 dispute is comprehended with art.
131........The purpose of art. 131 is to afford a forum for the resolution of
disputes which depend for their decision on the existence or extent of a legal
right." In State of Karnataka v. Union of India & Anr. Beg C.J.
Stated as under:
"It has to be remembered that Article
131 is traceable to section 204 of the Government of India Act. The
jurisdiction conferred by it thus originated in what was part of the federal
structure set up by the Government of India Act, 1935. It is a remnant of the
Federalism found in that Act. It should, therefore, be widely and generously
interpreted for that reason too so as to advance the intended remedy. It can be
invoked, in my opinion, whenever a State and other States or the Union differ
on a question of interpretation of the Constitution so that a decision of it
will affect the scope or exercise of governmental powers which are attributes
of a State. It makes no difference to the maintainability of the action if the
powers of the State, which are Executive, Legislative and Judicial, are
exercised through particular individuals as they necessarily must be. It is
true that a criminal act committed by a Minister is no part of his official
duties. But, if any of the organs of the State claim exclusive power to take
cognizance of it, the state, such, becomes interested in the dispute about the
legal competence or extent of powers of one of its organs which may
emerge." On a careful consideration of the whole matter in the light of
the decisions of this Court referred to above, we feel that Article 131 of the
Constitution is attracted only when a dispute arises between or amongst the
States and the Union in the context of the constitutional relationship that
exists between them and the powers, rights, duties, immunities, liabilities,
disabilities etc. flowing there from. Any dispute which may arise between a
State in the capacity of an employer in a factory, a manufacturer of goods
subject to excise duty, a holder of a permit to run a stage carriage, a trader
or businessman carrying on business not incidental 709 to the ordinary functions
of Government, a consumer of railway services etc. like any other private party
on the one hand and the Union of India on the other cannot be construed as a
dispute arising between the State and the Union in discharge of their
respective executive powers attracting Article 131 of the Constitution. It
could never have been the intention of the framers of the Constitution that any
ordinary dispute of this nature would have to be decided exclusively by the
Supreme Court. It is well to remember that the constitutional proposals of the
Sapru Committee advocated the strengthening of the position of the Federal
Court in India and widening its jurisdiction on the original side so that the
Federal Court could act as an interpreter and guardian of the Constitution and
as a tribunal for the determination of the disputes between the constituent
units of the Federation. The Joint Committee on Indian Constitutional Reforms
was also of opinion that the object of conferring exclusive original
jurisdiction on the Federal Court was that the disputes of the kind specified
between the Federation and the Provinces as the constituent units of the
Federation should not be left to be decided by courts of law of a particular
unit but be adjudicated upon only by the highest tribunal in the land which
would be beyond the influence of any one constituent unit. The Special
Committee consisting of Sriyuts S. Varadachariar, Alladi Krishnaswami Ayyar,
B.L. Mitter. K.M. Munshi and B.N. Rau appointed by the constituent Assembly to
consider and report on the constitution and powers of the Supreme Court
suggested 'that the Supreme Court, like the Federal Court under the 1935
constitution, would be the best available forum for the adjudication of all
disputes between the Union and a unit and between one unit and another and
proposed that the court should have an exclusive original jurisdiction in such
disputes'. (Vide The Framing of India's Constitution-A Study by Shri B. Shiva
Rao at p. 483).
Considered in the light of the foregoing the
conclusion becomes inevitable that disputes of the nature involved in this case
could not have been in the contemplation of the framers of the constitution
when they adopted Article 131 of the Constitution.
In the instant case the legal right of the
State of Rajasthan to sue for damages for the loss suffered by it on account of
the damage caused to the goods transported through the Railway Administration
as such is not in dispute between the Union Government and like State of
Rajasthan.
The State Government has made a claim the any
other consignee of goods dispatched through the railway for compensation and
its success or failure in the suit depends on proof of facts which have to be
established in the same way in which a private person would have to establish.
This is not even a case where a formal contract is entered into between the
Union of India and the State of Rajasthan in accordance with the requirements
of Article 299 of the Constitution. It is just a commercial contract under
which an officer of the State of Rajasthan was entitled to claim delivery of
the goods consigned as any ordinary consignee.
It may be noticed that the jurisdiction of
the Supreme Court under Article 131 of the Constitution is subject to the other
provisions of the Constitution. Under Article 298 of the Constitution the
executive power of the Union and of each State extends to the carrying on of
any trade or business and to the acquisition, holding and disposal of property
and the making of contracts for any purpose. That Article further provides that
the said executive power of the Union shall, in so far such trade or business
or such purpose is not one with respect to which Parliament may make laws, be
subject in each State to legislation by the State and said executive power of
each State shall, in so far as such trade or business or such purpose is not
one with respect to which the State Legislature may make laws, be subject to
legislation by Parliament. The claim involved in this case is one based on
section 80 of the Indian Railways Act 1890. Under that section a suit for
compensation for loss of life of, damage, deterioration or non-delivery of
animals or goods may be instituted if the passenger was or the animals or goods
were booked from one station to another on the railway of the same Railway
Administration against that Railway Administration and if the passenger was or
the animals of goods were booked through over the railways of two or more
railway administrations against the Railway Administration from which the passenger
obtained his pass or purchased his ticket or to which the animals or goods were
delivered for carriage, as the case may be, or against the railway
administration on whose railway the destination station lies, or the loss,
injury, destruction or damage or deterioration occurred and in either case the
suit may be instituted in a court having jurisdiction over the place at which
the passenger obtained his pass or purchased his ticket or the animals or goods
were delivered for carriage, as the case may be, or over the place in which the
destination station lies or the loss, injury, destruction, damage or
deterioration occurred Section 80 of the Indian Railways Act 1890 indicates
that the claim made under it is essentially against the Railway Administration
concerned.
The Union of Indian is impleaded as a party
to suits instituted there under being the owner of the Indian Railways by 711
virtue of Article 300 of the Constitution. The statute, however, treats the
dispute as one between the Railway Administration concerned and the person
instituting the suit. Neither of the parties to these proceeding, is
questioning the applicability of the provisions of the Indian Railways Act,
1890 to these proceedings. It is, therefore, difficult to hold that in these proceedings
is any question which falls within the scope of Article 131 of the
Constitution.
The High Court and the District Judge were,
therefore, right in holding that the suit was entertainable by the District
Court.
For the foregoing reasons, this Special Leave
Petition fails and hereby dismissed.
H.S.K. Petition dismissed.
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