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A. Faqir Chand Vs. C.P.W.D. Work Charged Staff Consumers Co-operative Society and ors. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtDelhi High Court
Decided On
Case NumberRegular Appeal No. 517 of 1968
Judge
Reported inAIR1972Delhi135; ILR1972Delhi421
ActsBombay Cooperative Societies Act, 1925 - Sections 54; Constitution of India - Article 226; Delhi Laws Act, 1912 - Sections 7
AppellantA. Faqir Chand
RespondentC.P.W.D. Work Charged Staff Consumers Co-operative Society and ors.
Advocates: Ramesh Chandra,; R.L.Tandon,; S.S.Chadha,;
Cases ReferredIn D. S. Sharma v. Union of India
Excerpt:
(i) bombay co-operative societies act, 1925 (as extended to delhi) - sections 54 & 57--adjudication of dispute--competence of registrar to award costs and interest--award allowing costs & interest--finality of--interference in writ proceedings--when possible--constitution of india articles 226 & 227.; that neither the terms of reference of the dispute nor rule 37 or any other provision of law authorised the registrar to award costs or interest to the respondent no.1 against the petitioner, the grant of costs and interest being beyond the jurisdiction of the registrar. in that respect thereforee, the decision of the registrar is not final within the meaning of section 57 and is liable to be called in question in any civil court. the grant of costs and interest also constitutes.....v.s. deshpande, j. (1) the bombay co-operative societies act, 1925 was extended to delhi by a notification dated 8-1-1949 by the central government acting under section 7 of the delhi laws act, 1912, subject to certain modifications. section 73 of the bombay co-operative societies act had repealed the co-operative societies act, 1912 insofar as it applied to the province of bombay. clause 12 of the notification modified section 73 of the said act while extending it to delhi in the following words :- 'for section 73, the following section shall be substituted, namely:- section 73. the co-operative societies act, 1912 in so far as it applied to the province of delhi, is hereby repealed.' under section 54 of the bombay co-operative societies act, a dispute between the petitioner and his.....
Judgment:

V.S. Deshpande, J.

(1) The Bombay Co-operative Societies Act, 1925 was extended to Delhi by a notification dated 8-1-1949 by the Central Government acting under section 7 of the Delhi Laws Act, 1912, subject to certain modifications. Section 73 of the Bombay Co-operative Societies Act had repealed the Co-operative Societies Act, 1912 insofar as it applied to the province of Bombay. Clause 12 of the Notification modified section 73 of the said Act while extending it to Delhi in the following words :-

'For Section 73, the following section shall be substituted, namely:- Section 73. The Co-operative Societies Act, 1912 in so far as it applied to the province of Delhi, is hereby repealed.'

Under Section 54 of the Bombay Co-operative Societies Act, a dispute between the petitioner and his employers, the C.P.W.D. Work Charge Staff Consumers Co-operative Society Ltd. (Respondent No. 1) was referred to the Registrar of Co-operative Societies (Respondent No. 2). The dispute was decided by the award of the Registrar made on 12-10-66 directing the petitioner to pay to the respondent No. 1 Rs. 5276.84 as principal plus costs of Rs. 527.00 together with interest at the rate of 8% per annum until realisation of the principal sum of Rs. 5276.84.

(2) The validity of this award has been challenged by this petition. Learned Counsel for the petitioner Shri Ramesh Chandra confined his G argument only to the following grounds of challenge viz:-

(A)the Co-operative Societies Act, 1912 already applied to Delhi and, thereforee the Central Government had no power to extend the Bombay Co-operative Societies Act, 1925 to Delhi in 1949 under section 7 of the Delhi Laws Act, 1912;

(B)the notification dated 8-1-1949 extending the Bombay Co- H operative Societies Act, 1925 to Delhi modified Section 73 of the said Act stating that the Co-operative Societies Act, 1912 in so far as it applied to Delhi, was repealed. The Central Government had no power to repeal the central act while extending the provincial enactment to Delhi. The whole of the notification extending the Bombay Cooperative Societies Act to Delhi was, thereforee, void;

(C)the notification dated 8-1-1949 was signed by a Deputy Secretary to the Central Government but neither the Governor General nor the Chief Commissioner of Delhi applied his mind or exercised his discretion to extend the said Act to Delhi. The Notification was, thereforee, void; and

(D)the reference to the Registrar under section 54 was contrary to the procedure prescribed in Rule 35 of the Rules made under the Bombay Co-operative Societies Act and the respondent No. 3 had, thereforee, no jurisdiction to make the impugned award. At any rate he had no jurisdiction to grant costs and interest on the award to the respondent No. 1.

(3) The respondents I and 2 denied the claim in the writ petition and urged the following preliminary objections to its maintainability:-

(I)the objections to the validity of the extension of the Bombay Co-operative Societies Act to Delhi should have been urged by the petitioner by way of a writ petition early to this court but he did so 2 years and 4 months after the reference of the dispute to the Registrar.

(II)the petitioner had first tried to secure a favorable award from the Registrar and then from the Delhi Cooperative Tribunal (Respondent No. 4) and it is only after he failed to get one that he has now come to this court. His conduct disentitles him to the discretionary relief sought by him;

(III)the objection that the reference of the dispute to the Registrar was in violation of section 54 of the Bombay Cooperative Societies Act or Rules 35 framed there under should have been urged before the Registrar and the Co-operative Tribunal. As the petitioner did not do so, he cannot raise this objection for the first time before this court.

(4) It would be proper for us to dispose of the preliminary objections before considering the merits of the writ petition. It is true that the writ petition has not been filed expeditiously but the petitioner cannot be blamed if he chose to take the dispute before the arbitrator and refrain from challenging the validity of the extension of the statute till the award had become final. In fact if the petitioner had come to this court to challenge the validity of the statute, he would have been met with the objection that he was bound first to exhaust the statutory remedies before filing the writ petition. This is what he did and rightly so. Of course if the award had been favorable to him, he would have had no occasion to file this writ petition. It is only because the award has gone against him that he ha,d to do so. But there is nothing blame worthy in this conduct and it does not by itself disentitle him to relief by way of writ petition, if he has otherwise a good case on merits. An appeal and then a revision filed against the award were ultimately disposed of by the Co-operative Tribunal (Respondent No. 4) only in January 1968. The petition was filed in July, 1968 and was, thereforee, not unduly delayed.

(5) First two preliminary objections have. thus no force but the third preliminary objection is partly well founded. The dispute was referred to arbitration by the resolution of the respondent No. 1 dated 25-11-65. The notice under rule 35 was issued by the Registrar to the petitioner on 27-3-66. The petitioner says he received the notice on 6th April, 1966. On 16th April, 1966, he wrote to the Respondent No. 1 that he wanted the dispute to be referred to the arbitration of 3 arbitrators. He had to do so according to Rule 35 'within 15 days of the issue of such notice'. The learned counsel for the petitioner contended that the word 'issue' in rule 35 should be construed to mean 'receipt'. The construction of Rule 35 was a matter within the jurisdiction of the Registrar and also of the Cooperative Tribunal when the dispute was heard by the Registrar and the appeal and the revision against the award were heard by the Co-operative Tribunal. The petitioner was bound, thereforee, to urge this contention before them. They would have also decided whether infact the notice was received by the petitioner on the 6th of April and whether the letter of the petitioner written on the 16th of April, 1966 to the respondent No. 1 was sufficient or whether the letter should have been written by him to the Registrar and finally whether the copy of the said letter was endorsed by him to the Registrar and whether it was ever received by the Registrar. All these questions could be decided only by the Registrar and the Co-operative Tribunal under the Bombay Co-operative Societies Act, 1925. As they were not urged before them the petitioner cannot urge them before this court by way of writ petition for the first time.

(6) As to the grant of costs and interest, however, the jurisdiction of the Registrar under section 54 is restricted .only to the dispute which is referred to him. The dispute was only regarding the principal sum. There was no claim and, thereforee, no dispute regarding costs or interest, Under rule 37 the Registrar could award costs according to a scale laid down by him. It is understood that no such scale has been laid down by the Registrar. It is clear, thereforee, that neither the terms of reference of the dispute nor rule 37 or any other provision of law authorised the Registrar to award costs or interest to respondent No. 1 against the petitioner. It is true that the petitioner could have disputed the legality of the grant of costs and interest in the appeal and revision before the cooperative tribunal. However, even if he did not so do, the grant of costs and interest were beyond the jurisdiction of the Registrar. In that respect, thereforee, the decision of the Registrar is not final within the meaning of section 57 and is liable to be called in question in any civil court. The grant of costs and interest also constitutes an error of law apparent on the face of the record to be corrected by this court in exercise of the writ jurisdiction under Articles 226 and 227 of the Constitution. Only in this respect, the 4th contention of the petitioner included in ground No. (d) urged by his learned counsel is, thereforee, allowed.

(7) We shall now consider the contentions urged by the petitioner against the validity of the extension of the Bombay Co-operative Societies Act to Delhi.

(A)The authority of the Central Government to apply the Bombay Act to Delhi was based on Section 7 of the Delhi Laws Act, 1912 which is as follows :-

'The provincial Government may, by notification in the official gazette, extend with such restrictions and modifications as it thinks fit, to die province of Delhi or any part thereof, any enactment which is in force in any part of British India at the date of such notification.'

(8) In 1912 when the Delhi Laws Act was passed local legislatures consisting of legislative councils of the Governors and Lt. Governors of the provinces such as Bombay, Madras, Bengal, North West provinces (U.P.) and the Punjab were functioning with legislative powers confined to the provinces. But no such legislative council was set up for the Chief Commissioner's province. The central legislature, thereforee, enacted the Delhi Laws Act 1912 to enable the Chief Commissioner, Delhi to extend 'enactments in force in any part of British India' to Delhi. By the Government of India Act of 1919, the powers of the provincial legislative councils were extended to include' the right to repeal or alter any law made for the province before and after the Act of 1919 by any authority in British India though the previous sanction of the Governor General was required if the provincial legislation concerned certain matters- The Bombay Co-operative Societies Act, 1925 was enacted with such previous sanction. Section 73 of the said act could, thereforee repeal the Co-operative Societies Act, 1912 in so far as it applied to the province of Bombay.

(9) The meaning of the word 'any enactment which is in force in any part of British India' is wide enough to include both Central as well as the provincial Acts, but the Central Act would have already been in force in the Chief Commissioner's province of Delhi. The intention of the legislature must, thereforee have been to enable the provincial Government of Delhi to extend to Delhi only those enactments which were in force in any part of British India other than Delhi. As the provincial legislatures existed only in the provinces ruled by Governors and Lt. Governors but not in the Chief Commissioner's province, it would appear that it is only the enactments which were in force in the provinces but were not in force in the Chief Commissioner's province which must have been meant by section 7 of the Delhi Laws Act, to be extended to Delhi. This intention of the Central legislature seems to have been made clear in the subsequent enactments namely section p. 2 of the Ajmer Marwara (Extension of Laws) Act, 1947 and in section 2 of the part C States (Laws) Act, 1950 by using the words 'any enactment which is in force in any other province' in the former and 'any enactment which is in force in a part A State' in the latter.

(10) While the power given to the Central Government under section 7 of the Delhi Laws Act, 1912, in general words has to be construed as being restricted to the extension of only those enactments which were in force in the province but were not in force in the Chief Commissioner's province of Delhi, there is nothing to indicate that the legislature intended to put any further restriction on this power. Contention (a) of the petitioner is that it is only when there is no law at all in the Chief Commissioner's province on a particular subject that the Central Government can exercise its power under section 7 of the Delhi Laws Act 1912 to extend a, provincial law to Delhi. The intention of the legislature in enacting section 7 was to save the central legislature, the time and trouble involved in enacting such laws for application to the Chief Commissioner's province as were already in force in the Governor's province. (Smt. Marchi Devi v. Mathu Ram : AIR1969Delhi267 ). There is nothing in the language of section 7 to show that an enactment in force in a province could not be extended there under to Delhi if some other law already existed in Delhi on the same subject. If the legislature had intended to so restrict the power, it would have said so. For instance, the spheres of legislative power assigned to parliament and state legislatures have been defined in Article 246 of the Constitution. Section 7 does not follow the pattern of Article 246 and does not say that enactment relating to particular subjects only can be extended to Delhi there under. Nor does it say that an improvement on the laws existing in the Chief Commissioner's provinces cannot be made by the Central Government by extending laws in force in the Governor's provinces to Delhi. Only a moment's reflection is sufficient to show that the legislature could never have intended to put such a restriction in section 7. Firstly such a restriction would have led to stagnation. An existing law in Delhi on a particular subject may be inadequate. A new law enacted in a province may be fuller and better. It is common sense that the legislature must have intended to empower the Central Government to extend the fuller and better law from the provinces to Delhi even if an older inadequate law on the same subject existed there. Secondly, such a restriction would have been unworkable. It would be impossible to decide whether an existing law relates to a particular subject which is covered by a provincial law. The existing law may cover only a part of the subject while the provincial law may cover more of it or certain new aspects of it. If only such parts of the provincial law were to be extended as were not dealt with by existing law then the legal system in the Chief Commissioner's province would be a crazy quilt of patches. Part of the law on the same subject would be in the existing law while the rest of it would have to be found in those portions of the provincial law which are extended to Delhi. Thirdly, the authority conferred on the Central Government by section 7 was by an Act of legislature. It reflected the policy of legislature. The Central Government was only carrying out the will and policy of the legislature in acting under section 7. In Powell v. Apollo Candle Co. (1885) 10 A C 282,(l) it was urged before the Privy Council that the tax in question had been imposed by the Governor and not by the legislature who alone had the power to impose the tax. Their Lordships of the Judicial Committee of the Privy Council rejected the contention and pointed out that 'the duties levied under the order in council are really levied by the authority of the Act under which the order is issued'. If, thereforee, the provincial law extended to Delhi under section 7 conflicts with some existing law then this is the effect not of any arbitrary act of the Executive but of the carrying out of a Legislative policy by the Executive. Lastly, even before the Delhi Laws Act, 1912 was enacted the laws made by the Central Legislature were in force in the Governor's provinces side by side with the laws made by the provincial legislatures. In case of any repugnancy between the two or any parts of the two, the one which was competent to legislate on the particular subject and in the particular area or who had primacy over the other in case of conflict would have prevailed. For instance under Article 246(2) of the Constitution both the Parliament and the State legislatures have powers to legislate on the subjects enumerated in list Iii in the 7th Schedule of the Constitution. The state legislature is not prevented from making a law on a subject merely because Parliament has already legislated on it. The State 'legislature would take care .to see that its law does not conflict with the law made by Parliament. If it does so, then the law made by Parliament would prevail.against the law made by the State legislature as provided in Article 254. In the same. way the provincial law extended to Delhi, if inconsistent with an existing law, would either prevail over it or give way to it according to the respective competence of the legislatures to make laws on the particular subject.

(11) The Co-operative Societies Act, 1912 was a Central Act only in the sense that it was enacted by a Central legislature. In 1912, however, there was legislative dyarchy but no federal distribution of legislative powers. This was why even the provincial legislature could make a law on the same subject. But after the passing of the Government of India Act, 1935 and the Constitution of India 1950 the subject of co-operative societies became an exclusively State subject. The Co-operative Societies Act, 1912, thereforee, became by its nature law relating to the State List in the Seventh Schedule of the Constitution. It could be amended or repealed by the State legislatures. Of course. the Central legislature could, legislate for co-operative societies only in respect of the Chief Commissioner's province. But it was precisely to avoid this that section 7 of the Delhi Laws Act, 1912 was enacted.

(12) This situation is to be contrasted with the one obtaining in Chander Bhan v.. Maha Singh, where the subject of stamp duties was divided in all the three Lists, namely, the Central List, the,(State List and the Concurrent List of the Seventh Schedule of the Constitution. That decision would, thereforee, have no bearing on the facts of the present case. The effect of the extension would be to keep both the Acts in force in Delhi side by side unless any part of the former was inconsistent with any part of the latter. It is only to the extent of irreconcilable repugnancy that any part of the former would be impliedly repealed by the latter. This consequence also must have been intended by the Central legislature in enacting section 7 of the Delhi Laws Act 1912. It is not for this Court to prevent a conflict between an existing law and an extended law in a Chief Commissioner's province.

(13) In Marchi v. Mathu Ram : AIR1969Delhi267 it was argued that the Punjab Preemption (Amendment) Act, 1960 could not be extended to Himachal Pradesh under Section 2 of the Union. Territories (Laws) Act, 1950 because the Punjab Preemption Act 1913 was already in force in Himachal Pradesh and that the Central Government had no power to repeal or abrogate an existing law by extending the amendment to the parent Act to Delhi. This argument was rejected after a full consideration. Section 2. of the Union territories (Laws) Act, 1950 was in pari materia with section 7 of the Delhi Laws Act,'1912 in as much as the Union Territories (Laws) Act, 1950 was only an adaptation of the part C States (Laws) Act, 1950. The ratio of that decision is directly applicable to the present case. Contention (a), thereforee. fails.

(B)Unamended section 2 of,the Part C States (Laws) Act, 1950 after empowering the Central Government (which meant the Governor General Or the Governor General in Council as the case maybe in relation to anything, done before, the commencement of the Constitution in view of Section 3(viii);of the General Clauses Act 1897)to extend any enactment in force in a part A State had given it a further power in the following words:--

'Provision may be made in any enactment so extended for the repeal or amendment of any corresponding law (other than Central Act) which is for the time being applicable to that part C State.'

INRe Delhi Laws Act, 1912,1951 Scr 747 (-0 the Supreme Court held that the legislature could not validly delegate this latter power of repeal .lo the Government in as much as this would be surrendering legislative policy (which is the essential function of the legislature) to the executive Government. It is clear, thereforee, that the notification which could be issued by the Government under Section 7 of the Delhi Laws Act 1912 (which corresponded to the valid part of section 2 of the part C States Laws Act 1950) could not itself repeal any corresponding Jaw, much less a Central Act, which was for the time being applicable lo the Chief Commissioner's province of Delhi.

(14) The repeal of the Co-operative Societies Act 1912 was effected by Section 73 of the Bombay Co-operative Societies Act 1925 in so far as the province of Bombay was concerned by section 73 of the latter Act long before the latter Act was extended to Delhi in 1949. The power to extend the Bombay Act to Delhi included the power to modify the Bombay Act. After fully considering the case law it was held by this court in Lachmi Narain v. Union of India 1971(1) Delhi 107 that 'it would be quite reasonable to hold that the word 'modification' in section 7 of the Delhi Laws Act means and signifies changes of such character as are necessary to make the statute which is sought to be extended suitable to the local conditions of the Chief Commissioner's province.' The original section 73 of the Bombay Act purported to repeal the Co-operative Societies Act 1912 only in its application to the province of Bombay. 'This reference to the province of Bombay would !have no meaning in the said Act when extended to Delhi. It was neccesary, thereforee, to modify Section 73 to make it have a meaning in Delhi in extending it to Delhi. This is why the Section was modified to say that the Co-operative Societies Act 1912 is repealed in so far as it applies to the province of Delhi. The province of Delhi was substituted in place of the province of Bombay.

(15) The learned counsel for the petitioner contends that this mollification of the Bombay Act made by clause 12 of the impugned notification dated 8-1-1949 was ultra virus section 7 of the Delhi Laws Act 1912 For, it means that the Central Government itself repealed the Co-operative Societies Act 1912 in extending the Bombay Act to Delhi. According to the Supreme Court decision in the Delhi Laws Act case even the legislature could not empower the Government to do so. thereforee, his power could not be implied in section 7 of the Delhi Laws Act.

(16) This argument over-looks the essential distinction between J repeal made by the Central Government of the existing law in providing lor the extension of a new law to Delhi and the repeal already made by the State Legislature in the provincial law which is extended by the Central Government to Delhi with suitable modifications. The former was held to be excessive delegation of legislative power to the Central Government. But the latter is the legislative power conferred on Central Government by section 7 of the Delhi Laws Act. This is why only the last part of section 2 of the part C States (Laws) Act 1950 was held to be void by the Supreme Court. For, it alone gave the executive power to repeal an existing law. On the other hand, the rest of section 2 of part C State (Laws) Act 1950 was held to be valid because it only enabled the Central Government to extend a law from a part A State to a part C State. The impugned notification does not repeal the Co-operative Societies Act 1912 while extending the Bombay Co-operative Societies Act 1925 to Delhi. Had it done so, it would have been invalid to that extent. On the contrary the notification merely extends the Bombay law to Delhi with suitable modifications. One of the modifications is to substitute Delhi for Bombay. This is all that has been done in section 73. The repeal of the Cooperative Societies Act 191,2 had already been made long ago by the Bombay Legislature by enacting section 73. The Central Government did not do so while extending the Bombay Law to Delhi.

(17) Even if, for the sake of argument, the modification of Section 73 is held to amount to a direct repeal of the Bombay Co-operative Societies Act 1912, by the Central Government, the only effect would be that clause 12 of the notification containing this modification of Section 73 would be invalid. The Co-operative Societies Act 1912 would then continue to be in force in Delhi. Clause 12 of the notification is severable from the rest of the notification for the same reason that the last part of Section 2 of the part C States (Laws) Act 1950 was held lo be severable from the rest of Section 2. The rest of the notification extending the Bombay Act to Delhi would at any rate be valid. In the present case we are not concerned either with the Co-operative Societies Act 1912 or with section 73 of the Bombay Co-operative Societies Act 1925. thereforee, it would make no difference to the decision of this case whether clause 12 of the impugned notification is valid or not.

(C)The learned counsel contended that the issue of the impugned notification was a legislative Act. It was not. thereforee, an exercise of the executive power of the Governor General. The Deputy Secretary to the Government of India who was authorised to authenticate orders id other instruments made and executed in the name of the Governor General by the notification No. '67/47-R, dated 19th August 1947, issued under section 17(2) of the Government of India Act 1935 was not, thereforee, competent to authenticate the impugned notification. This argument is not new. In D. S. Sharma v. Union of India, : AIR1970Delhi250 , a Division Bench of this Court considered the same argument,viz., that the notification promulgating statutory Service Rules was a legislative act and it could not be authenticated by an officer authorised to authenticate the orders and other instruments made and executed in the name of the President according to Rules framed under Art. 77(3) of the Constitution. It was pointed out them that the meaning of 'executive power' and 'executive action' in Articles 73 and 77 of the Constitution was wide enough to cover all power and action which was neither judicial nor legislative. The making of subordinate legislation or issuing of a notification under a statute by the Government or an authority empowered to do so by the statute was not legislation in the same sense in which the making of an Act or an Ordinance is so. The executive capacity of the Government or the President to act under various statutes, is different from their legislative capacity to make laws, for instance, under Articles 123 and 357 of the Constitution. In making statutes and ordinances, the President act as legislature. But in acting under a statute he exercises executive power in the broad sense in as much as he is not making sovereign legislation in the exercise of legislative power given by the Constitution. No other procedure is laid down in the Constitution for issuing statutory notifications or statutory rules. Unless the petitioner can show that the Governor General was required to do so personally, the officers authorised under section 17(2) of the Government of India Act 1935 which included a Deputy Secretary to the Government of India could do so. As pointed out in D. S. Sharma's case the distinction between legislative, judicial and executive powers in the Constitution is based not on .the nature of the act performed but on the nature of the authority performing the particular act. thereforee, all. acts performed by the executive are in exercise of the executive power. The issue of the impugned notification was, thereforee, in exercise of executive power and was properly authenticated by the Deputy Secretary to the Government of India. Due to that reason' this court is precluded from enquiry into the question whether the Governor General personally applied his mind before it was issued.

.

(D)This contention has already been dealt within, considering the preliminary objections to the maintainability of the petition. The grant of costs and interest by the Registrar in making the award was beyond The jurisdiction and, thereforee, void. This part of the award is, however severable from the rest of the award and does not vitiate it.

(18) The writ petition is, thereforee, substantially dismissed but is only allowed to a small extent. The last part of the award granting costs and interest to the respondent No. 1 against the petitioner is quashed. The rest of the award is upheld. The orders passed by the Cooperative Tribunal in appeal and revision would also stand modified to the extent that they uphold the rest of the award but not the grant of costs and interest. In the above circumstances we make no orders as to costs.


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