1. Miscellaneous Petition No. 147 of 1955 was filed before a Division Bench consisting of Chief Justice Hidayatullah and Mr. Justice Mangalmurti for an order to quash an order-passed by the Civil Court dismissing the suit filed by the petitioner, and the Bench referred two questions to a Full Bench
(1) Whether Section 242 of the Madhya PradeshLand Revenue Code, 1954, is ultra vires the Constitution for the reason that it creates discrimination between person whose suits were filed before 25-3-1951 and those whose suite were filed alter that date and
(2) whether the third sub-section of the impugned section involves exercise of judicial power and not legislative power?
The facts on which this petition was based are briefly these. On the 15-3-1053 the respondent purchased survey Nos. 103/1 and 105/1. The petitioner was a co-occupant of survey No. 103/2 and 105/2 and he filed a suit on 15-6-1954 under Chapter XIV of the Kerar Land Revenue Code claiming his right of pre-emption in respect of the two survey numbers sold to the respondent. This is the suit which was dismissed by the trial Court on the ground that by reason of the provisions of Act II of 1955 the suit of the petitioner was not maintainable.
2. Now, under Section 183 of the Berar Land Revenue Code, when an occupant in a survey number transfers his interest or any portion thereof, by any of the transfers contemplated in the sections set out, or suffers a final decree for foreclosure as contemplated in Section 177 to be passed against him, and no notice has been given as required by these sections, the other occupants in the survey number shall have a right to pre-empt the interest transferred. Such right may be enforced by a Civil Court, and in all such cases the Court shall have power to examine the transaction and fix a fair consideration for the interest to be preempted; and the case of the petitioner was that no notice was given to him as contemplated by this sub-section and therefore he being an occupant in the survey number, part of which was transferred, he had a right to preempt the part which had been sold to the respondent.
3. A Bill was introduced in the Madhya Pradesh Legislature on 7-4-1933 for codification of the Madhya Pradesh Land Revenue Code and this Bill was referred to the Select Committee on 29-9-1953. In the Bill as originally introduced the provision contained with regard to pre-emption in Chapter XIV of the Berar Land Revenue Code was retained. The Select Committee made its report on 25-3-1054 and by its report it recommended the repeal of Chapter XIV of the Berar Land Revenue Code. This report was published in the Gazette on 26-3-1954. The Bill ultimately passed by the legislature incorporated the recommendation of the Select Committee and the Bill received the absent of the President on the 5-2-1955 and became Apt II of 3955. The Act as assented to by the President was published in the Gazette on 12-2-1935. Turning to the provisions of this Act, Section 242(1) provides that Chapter XIV of the Berar Land Revenue Code shall a and repealed. Sub-section (2) provides:
'(2) Notwithstanding the repeal of Chapter XIV of the Berar Land Revenue Code, 1928, any suit to enforce a right of preemption under that Code filed on or before 213-3-1954 shall be decided in accordance with the provisions in that Code'. And Sub-section (3) provides:
'(3) Any suit to enforce a right of pre-emption under the Berar Land Revenue Code, 1928, instituted after 25-3-1954, except a suit for specific performance of a contract of sale or purchase as provided in Section 181 of that Code shall, notwithstanding that that Code remains in force after that date until its repeal by this Code, be dismissed.'
Now, it was by reason of Section 242(3) that the Civil Court dismissed the petitioner's suit inasmuch as it had been filed on 15-6-1954, i.e. after 25-3-1954, and Mr. Abhyankar on behalf of the petitioner has challenged the virea of this 'subsection.
4. It is clear that the suit of the petitioner was a pending suit at the date when the Act came into force. Section 1(3) provides that Section 242 shall come into operation immediately, and therefore the Act having come into force on 5-2-1956 the suit filed by the petitioner was at that date a pending suit. The objection taken by Mr. Abhyankar to Sub-section (3) of Section 242 is that it offends against Article 14 of the Constitution, and what is urged before us is this that it would have been competent to the Legislature to deal with all pending suits at the date the Act came into force. It could have provided, that ail pending suits should be saved or it could have provided that all pending suits should be dismissed. But what the Legislature has done is that it has discriminated between the class o pending suits. It has provided that suits filed before 25-3-1954 shall be saved and the suits filed after 23-3-1954 shall he dismissed. In other words, a litigant who filed a suit before 25-3-1954 had his right of preemption saved and a litigant who filed a suit after 25-3-1954 had his right of preemption taken away, and it is said by Mr. Abhyankar that this discrimination is one which is not countenanced by the provisions of Article 14 of the Constitution. Now. Article 14 has been construed in innumerable oases which have come up before the various High Courts in India and also before the Supreme Court, and the principles underlying that Article are now well settled. The difficulty that arises, as arises in most cases, is not the enunciation of the principle but the application of the principle to the given facts. The principle briefly stated is that Article 14 does not prohibit the Legislaturefrom classifying or in setting up different classes to some, of which the law may apply and to others the law may not. But in order that there should be a classification which can be- upheld by the Court, the classification must be on some rational basis. The distinction made between one class; and another must be such as must be intelligible and the classification also must have some rational nexus with the object which the legislation is intended to achieve.
5. Now, let us apply these two tests to the legislation we have before us. It is perfectly true that it is open to the Legislature to have a classification on the basis of time just as much as it can have a basis on geographical or territorial considerations. But if the Legislature brings about a desiccation on the basis of time, the point of time selected must be for some rational and intelligible consideration. A purely arbitrary or capricious selection of time could net possibly form the basis of a rational classification. The date selected. 25-3-1S54, we have teen told by the Special Government Pleader, was because the Select Committee reported on that date, it is difficult to understand how that date affords any rational basis for a classification on the 'ground of time. The Bill as introduced preserved tee right of preemption. The sale in this case which gave the right to the petitioner was on 15-6-1953 and he had no notice that the Bill was going to take away his right. The Joint Select Committee reported on 25-3-1954, but there is no reason why anyone should have assumed that the recommendation of the Select Committee would necessarily be accepted by the Legislature. Therefore, when the petitioner filed his suit on 15 6-1954, he did so long before the right was taken away by the Legislature by the President giving his assent to the legislation on 5-2-1955. Why a litigant who filed a suit on 24-3-195 should be differently treated from a litigant who filed a suit after 25-3-1954, it is difficult to understand. The object of Article 14, as has been so often said, is that persons should be uniformly treated by law unless there is some rational reason why they should be treated differently, Therefore, if the petitioner comes before us and says that his suit has been dismissed because he filed it after 25-3-1954 and the suit of another person has been saved merely because he filed his suit prior to 25-3-1654, then we have to consider whether the Legislature had any possible reason why it should have selected this date and made this distinction between the petitioner and a litigant who filed a suit prior to 25-3-1954.
6. Now. Mr. Gadgil who appears in another connected matter before us for the vendee, says that what the Legislature seems to have done is to have given retrospective effect to the repeal of Chapter XIV of the Berar Land Revenue Code and from that retrospective effect it has saved certain suits and those suits are those filed before 25-3-1954 and Mr. Gadgil says that it is open to the Legislature to fix a particular point of time beyond which the Legislation will not have retrospective effect. Now, the proposition enunciated by him is perfectly sound. The Legislature has the right, to give retrospective effect to this legislation. The Legislature has also the right to determine from what date the retrospective effect will cease. But when it has given retrospective effect to a legislation, and when it gives the benefit to a certain class against the retrospective effect of the legislation, and when it submits a particular class to the effect of the retrospective legislation, it undoubtedly creates two classes, and the justification of the existence of two classes can only be on theprinciples which we have laid down. As we said before, there was nothing to prevent the Legislature from giving retrospective effect to the legislation. It could have taken away the rights of all pending litigants. Equally, it was open to the Legislature to save the lights of all pending litigants, but what, the Legislature has done is to have saved the rights of some and taken away the rights of the others.
7. Now, there is a clear enunciation of the principle with regard to the saving of pending litigation in the judgment of the Supreme Court reported in Shiv Bahadur Singh v. State of Vindhya Pradesh : 1954CriLJ1480 (A). In that case the Vindhya Pradesh Criminal Law Amendment (Special Courts) Ordinance of 1949 was challenged and one of the grounds of the challenge was Article 14, and what was argued before the Supreme Court was that the saving clause which saved pending proceedings offended against that Article and the Supreme Court rejected that contention and pointed out:
'But there is no reason, why pending proceedings cannot be treated by the legislature as a class by themselves having regard to the exigancies of the situation which such pendency itself calls for. There can arise no question as to such a saving provision infringing article 14 so long as no scope is left for any further discrimination inter se as between persons affected by such pending matters.'
In this case the Legislature has riot treated pending proceedings as a class, but in that class it has further discriminated between litigants who filed suits before 25-3-1954 and litigants who filed suits after that date.
8. There are two other decisions of the Supreme Court which have also some bearing on the Question that we have to decide. The first is Shree Meermkshi Mills Ltd v. A.V. Visvanatha Sastri : 26ITR713(SC) (B). In that case the Indian Income-tax (Amendment) Act (XXXIII of IS54) was challenged and one of the arguments put forward by the Attorney General, which is reproduced in the judgment of the learned Chief Justice at p. 795 of SCR: (at p. 17 of AIR), was that the class of persons dealt with under Section 5(1) of Act XXX of 1947 was not only the class of substantial tax dodgers but was a class of persons whose cases the Central Government by 1-9-1948 had referred to the Commission and that class had thus become determined finally on that date, and that class of persons could be dealt with by the Investigation Commission under the drastic procedure of Act XXX of 1947 and the learned Chief Justice deals with this argument in the next paragraph:
'Assuming that evasion of tax to a substantial amount could form a basis of classification at all for imposing a drastic procedure on that class, the inclusion of only such Of them whose cases had been referred before 1-9-1948, into a class for being dealt with by the drastic procedure, leaving other tax evaders to be dealt with under the ordinary law will be a clear discrimination for the reference of the case within a particular time has no special or rational nexus with the necessity for drastic procedure.'
It is true that this passage was explained in a later judgment reported, in Thangal Kunju Musaliar v. Venkatachalam : 29ITR349(SC) . The later judgment, with respect, does not seem to accept the view taken by the earlier judgment that the mere fixing of a date would by itself attract the application of Article 14, but even this judg-ment makes it clear that when a date is fixed it can only be justified if it is the result of adminitrative convenience. See the passage cited at p. 268, which is the passage referred to in Meenakashi's case (B):
'By that passage, however, this Court did not hold that in fact Section 5 (1) was confined to such a limited class. We are of the opinion that the fixation of the date for reference for investigation by the Government to the Commission, viz,, 16-2-1950 was not an attribute of the class of substantial evaders of income, tax which were intended to be specifically treated under the drastic procedure prescribed in the Travancore Act 14 of 1124 but was a mere accident and a measure of administrative convenience.'
Now, we have asked the Special Government Pleader to satisfy us that the date 25th March 1954 was fixed as a matter of administrative conveni-ence and if we had been satisfied undoubtedly we would have accepted the contention put forward by him. But he was net in a position, as indeed he could, not be, to enlighten us as to why any administrative convenience was subserved by fixing the date 25th March 1954. Government has nothing whatever to do with the filing of suits by litigants and if the intention was to prevent over-crowding in Courts of law, it is more an administrative headache of the Judge concerned or the Administrative Jude in the High Court than the Government, and therefore in cur opinion even the limited construction which now the Supreme Court has placed upon the passage in Meenakshi's case (B) and even according to that limited interpretation the case offends against Article 14.
9. It was then urged by the Special Government Pleader that the provision of this Act was saved by Article 31-A of the Constitution. That Article Places certain types of legislation beyond the challenge of any person aggrieved by it if the challenge is under Articles 14, 19 or 31, and the legislation contemplated by Article 31-A is legislation providing for the acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights, and what the Special Government Pleader contends is that what the State was doing by the impugned Act was to extinguish the right of pre-emption, and if that is what the Legislature did then it is not open to the petitioner to challenge the legislation under Article 14. Now, the question that i.e. have to consider is whether this is a law which provides, for extinguishment of a right in an estate. It will be noticed that Article 31-A(1)(a) does not deal with any and every right; it deals with an estate or a right therein and the extinguishment must be of such a right. In order to decide this question we must consider what is the nature of a right of pre-emption. Mr. Justice Mahmood in a very early case, Gobind Dayal v. Inayatullah ILR 7 All 775 , laid down that the right of pre-emption was a right which the owner of an immoveable property had to obtain in substitution for the buyer of the proprietary possession of certain other immoveable property. Therefore, the right of pre-emption is nothing more than a right to be substituted for the vendee of some property other than the property owned by the parson claiming the right. It is not clearly an interest in land or a right in land. It is an inchoate right and it can only arise 'when there is a sale and the right attaches to the sale. It has also been held that the right of pre-emption is a purely personal right and it is not a right which is either transferable or assignable, nor is it a right which runs with the land. If that be the true natureof the right of pre-emption, then it is clear that within the meaning of Article 31-A of the Constitution it is not a right in an estate. The definition of 'estate' makes it clear that the Constitution was contemplating various types of land tenures under which property is held in different parts of India. Now, clearly, a right which' the owner of a property has to claim substitution for a vendee when adjoining property is sold to a third party without notice to him is not a right in any estate but a right purely personal to the occupant arising only in the event of there being a sale. Therefore, in our opinion, Article 31-A has no application to a right of pre-emption.
10. We are therefore of the opinion that Section 242 (3) is ultra vires as offending Article 14 of the Constitution. It is unnecessary for us to express any opinion with regard to the vires of Section 242 (2) because we have not anyone before us who hag filed a suit prior to the 25th March 1954 and it would not be right to decide the question of Section 242 (2) In the absence of any party before us who might be affected by any construction we may place upon that sub-section.
11. The result therefore will be that the rule in this petition will be made absolute.
12. There is also another petition No. 148 of 1955 where the same question arises and for the same reasons we will make the same order.
13. The third is an appeal which is pending against a decree passed by the trial Court in a pre-emption suit, and the appellant challenged the decree on the ground that the decree was bad inasmuch as it was passed in a suit filed after the 25th March 1954. This appeal was recalled by my brother Mr. Justice Mudholkar under Article 228 of the Constitution, and as the question involved in this appeal is the same that matter has also come before us. This appeal will now go back for disposal on merits before the lower appellate Court and the lower appellate Court will dispose of this appeal in the light of our judgment.
14. The outstanding amount of deposit tobe returned to the petitioners in both the petitions.
15. Order accordingly.