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Shri H.H. Sudhindra Thirtha Swamiar, Senior Swamiar of Puthige Mutt and ors. Vs. the Commissioner of Hindu Religious and Charitable Endowments and anr. - Court Judgment

LegalCrystal Citation
SubjectTrusts and Societies
CourtChennai High Court
Decided On
Reported inAIR1956Mad491; (1956)1MLJ532
AppellantShri H.H. Sudhindra Thirtha Swamiar, Senior Swamiar of Puthige Mutt and ors.
RespondentThe Commissioner of Hindu Religious and Charitable Endowments and anr.
Cases ReferredSoundararajan and Co. v. State of Madras Since
Excerpt:
- - 4. even at the outset we should like to emphasise that it is only in relation to the maths and matadhipathis that we propose to consider the validity of the impugned provisions of the act. 335; it is well known that there could be no such thing as unregulated and unrestricted right of entry in a public temple or other religious institution, for persons who are not connected with the spiritual functions thereof. the trouble that could ensue by deputing a servant of a hated rival to help a commissioner to exercise his statutory power of control could well be visualised. 16. despite the saving provision in clause (3) of the amended section 21, with its reference to the usage of the religious institution, that is, the math in this case, we are clearly of opinion that even after the.....rajagopalan, j.1. these ten applications were filed under article 226 of the constitution for the issue of appropriate writs to prevent the commissioner of the hindu religious endowments from enforcing some of the provisions of the madras. hindu religious and charitable endowments act xix of 1951 (hereinafter referred to as the act). it was the validity of some of the amendments effected by the madras hindu religious and charitable endowments (amendment) act xxvii of 1954 that was in issue.2. the matadhipathis of all the eight maths of udipi, who together manage the affairs of the sri krishna devara math, udipi, and conduct the worship therein by turns, filed w.p. no. 323 of 1955, in which were filed the affidavits and counter-affidavits which we had to consider in these proceedings. each.....
Judgment:

Rajagopalan, J.

1. These ten applications were filed under Article 226 of the Constitution for the issue of appropriate Writs to prevent the Commissioner of the Hindu Religious Endowments from enforcing some of the provisions of the Madras. Hindu Religious and Charitable Endowments Act XIX of 1951 (hereinafter referred to as the Act). It was the validity of some of the amendments effected by the Madras Hindu Religious and Charitable Endowments (Amendment) Act XXVII of 1954 that was in issue.

2. The Matadhipathis of all the eight Maths of Udipi, who together manage the affairs of the Sri Krishna Devara Math, Udipi, and conduct the worship therein by turns, filed W.P. No. 323 of 1955, in which were filed the affidavits and counter-affidavits which we had to consider in these proceedings. Each of the Matadhipathis also applied separately, each with reference to his own Math, raising the same issues as had been raised in W.P. No. 323 of 1955. Virtually similar reliefs were sought in W.P. No. 359 of 1955, filed by His Holiness Jagatguru Sri Sankaracharya Swamigal the Matadhipathi of the Math, Sri Kanchi Kamakoti Peetam, held in the highest esteem and veneration by a very large section of the Hindus in the South.

3. The control over the management of the Maths, among other religious institutions, and their properties imposed by the Hindu Religious Endowments Act II of 1927, was intensified by successive amendments. That Act was replaced by Act XIX of 1951, the provisions of which, in relation to Maths, were characterised as 'even more drastic' in their scope, in. that they cut deeply into some of thefundamental rights guaranteed by the Constitution. On appeal against the judgment of this Court in Shri Shirur Mutt v. Commissioner, Hindu Religious Endowments, Madras (1952) 1 M.L.J. 557. (S.C.), the Supreme Court decided in Commissioner, H.R.E. Board, Madras v. Shirur Math (1954) 1 M.L.J. 596 : (1954) S.C.J. 335, that the sections of the Act, which their Lordships specified, were invalid and unenforceable against Maths and Matadhipathis. The decision of the Supreme Court was rendered on 16th March, 1954. Subsequent to that, the Madras Legislature enacted Act XXVII of 1954, which received the assent of the President on 22nd September, 1954. That legislation was undertaken with the professed object of amending the offending provisions of Act XIX of 1951, so that they would no longer infringe the fundamental rights of the Matadhipathis guaranteed by Articles 19, 25, and 26 of the Constitution, as interpreted by the Supreme Court. It was the validity of some of these amended provisions of Act XIX of 1951 that the petitioners challenged in their applications.

4. Even at the outset we should like to emphasise that it is only in relation to the Maths and Matadhipathis that we propose to consider the validity of the impugned provisions of the Act. Possibly different considerations may apply to other religious institutions and the trustees thereof; e.g., private temples; public temples with trustees hereditary or otherwise and we express no opinion on that. We shall therefore confine ourselves to a consideration of Maths and Matadhipathis alone in this judgment. The challenge to the validity of many of the impugned provisions might have been avoided, had the Legislature itself kept in view the distinction between Matadhipathis and the trustees of other religious institutions and had enacted separate provisions for application to Maths and Matadhipathis. It is not necessary for us to traverse over again the ground covered by Shri Shirur Math v. Commissioner, H.R.E. Madras (1952) 1 M.L.J. 557, where, after a review of the case-law, Satyanarayana Rao, J., pointed out at page 571:

From this review of the authorities, it may be taken as established that the head of the Mutt is not a trustee in the sense in which that word is used in the law of Trusts, and his position cannot be brought under any legal label known to English jurisprudence. He is not even a life tenant in respect of the properties permanently vested in the Mutt or the religious institution. He has a right to the income but he has no power of disposition over the corpus unless necessity or benefit is established. He has large powers over the surplus of the income after meeting the demands of the institution as its maintenance, the maintenance of the disciples and the performance of the daily worship, etc. He has the discretion to use the surplus for spiritual objects and that discretion is unfettered so long as the surplus is not diverted to any immoral or wicked purposes. He has the liberty to accumulate the income. The padakanikas are at his absolute disposal. If, however, it is established that any specific property has been vested as a trustee in the head of the Mutt, to that extent and in respect, of that property, he becomes a trustee. In other respects he is not liable to account for the income much less to the padakanikas. He is a person with manifold rights and duties. He is the spiritual head; he is the teacher and the guru. He has to carry on the worship of the deity installed in the Mutt, maintain the disciples and propagate the views of the religion of the institution. His life is one of discipline and non-attachment to worldly things, and he is expected to meditate and study and further the creed of the Mutt. Such institutions are autonomous bodies governed and controlled by the directions and orders of the head of the Mutt.... It follows that to some extent he has the beneficial ownership of the properties while in respect of some of the properties he may be a manager. No doubt, the management of the properties bears a secular aspect, but the secular and the religious aspects cannot be dissociated as they are inextricably mixed up, when it is established that the property and the income are at the disposal of the swami for the sole and exclusive purpose of the spiritual welfare of himself and his disciples and followers.

These principles were approved of by the Supreme Court in the Shirur Mutt case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335 Mukherjea, J., as he then was, observed:

As regards the property rights of a Matadhipati, it may not be possible to say... that a Matadhipati holds the math property as a life-tenant or that his position is similar to that of a Hindu widow in respect of her husband's estate or of an English Bishop holding a benefice. He is certainly not a trustee in the strict sense. He may be as the Privy Council says, a manager or custodian of the institution who has to discharge the duties of a trustee and is answerable as such; but he is not a mere manager and it would not be right to describe Mahantship as a mere office. A superior of a math has not only duties to discharge in connection with the endowment but he has a personal interest of a beneficial character which is sanctioned by custom and is much larger than that of a shebait in the debutter property.... Thus in the conception of Mahantship, as in Shebaitship, both the elements of office and property, of duties and personal interest are blended together and neither can be detached from the other. The personal or.beneficial interest of the Mahant in the endowments attached to an institution is manifested in his large powers of disposal and administration and his right to create derivative tenures in respect to endowed properties; and these and other rights of similar character invest the office of the Mahant with the character of proprietary right which, though anomalous to some extent, is still a genuine legal right.

At page 346 the learned Judge observed further:

To take away this beneficial interest and leave him merely to the discharge of his duties would be to destroy his character as a Mahant altogether. It is true that the beneficial interest which he enjoys is appurtenant to his duties and as he is in charge of a public institution, reasonable restrictions can always be placed upon his rights in the interest of the public. But the restrictions would cease to be reasonable if they are calculated to make him unfit to discharge the duties which he is called upon to discharge. A Mahant's duty is not simply to manage the temporalities of a math. He is the head and superior of spiritual fraternity and the purpose of math is to encourage and foster spiritual training by maintenance of a competent line of teachers who could impart religious instructions to the disciples and followers of the math and try to strengthen the doctrines of the particular school or order, of which they profess to be adherents. This purpose cannot be served if the restrictions are such as would bring the Matadhipati down to the level of a servant under a State department. It is from this standpoint that the reasonableness of the restrictions should be judged.

At page 352 the learned Judge observed:

It should be noticed, however, that under Article 26(d) it is the fundamental right of a religious denomination or its representative to administer its properties in accordance with law; and the law, therefore, must leave the right of administration to the religious denomination itself subject to such restrictions and regulations as it might choose to impose. A law which takes away the right of administration from the hands of a religious denomination altogether and vests it in any other authority would amount to a violation of the rights guaranteed under Clause (d) of Article 26.

5. It is against this background that we have to consider the validity of the impugned provisions of the Amended Act XIX of 1951.

6. Clause (1), of Section 21 of the Act, as it stood in 1951, empowered the Commissioner, Deputy Commissioner, Assistant Commissioner and such other officers as are authorised by the Commissioner or by the Area Committee to enter the premises of any religious institution or any place of worship for the purpose of exercising any power conferred or discharging any duty imposed by or under the Act. Clause (2) provided for the help of the police, should any of the persons mentioned in Clause (1) of Section 21 need it to enter the premises of a religious institution. Clause (3) provided in effect that no one other than a Hindu should enter the premises of a religious institution under the authority conferred by Clause (1). Those provisions were struck down as invalid and unenforceable in relation to Maths and Matadhipathis. Mukerjea, J., observed at page 353 in the Shirur Math case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335;

It is well known that there could be no such thing as unregulated and unrestricted right of entry in a public temple or other religious institution, for persons who are not connected with the spiritual functions thereof. Section 21, it is to be noted, does not confine the right of entry to the outer portion of the premises; it does not even exclude the inner sanctuary, 'the Holy of Holies '! as it is said, the sanctity of which is zealously preserved. It does not say that the entry may be made after due notice to the head of the institution and at such hours which would not interfere with the due observance of the rites and ceremonies in the institution. We think that as the section stands, it interferes with the fundamental rights of the Matadhipathis and the denomination of which he is head guaranteed under Articles 25 and 26 of the Constitution.

After pointing out that Section 91 did not in terms regulate the power conferred by Section 21(1) of the Act, their Lordships observed with reference to Clause (b) of Section 91:

Clause (b) again does not say anything about custom or usage obtaining in an institution and it does not indicate by whom and in what manner the question of interference with the religious' and spiritual functions of the math would be decided in case of any dispute arising regarding it.

7. It was apparently to get over these objections that the Legislature amended Section 21 and enacted a fresh provision numbered Section 21-A. The provisions of the Act thus amended run:

21. Power to enter religious institution.-

(1) The Commissioner, Deputy Commissioner, Assistant Commissioner or such officers or servants of a religious institution as may be authorised by the Commissioner, Deputy Commissioner or Assistant Commissioner in this behalf, shall have power to enter the premises of any religious institution or any place of worship for the purpose of exercising any power conferred, or discharging any duty imposed, by or under this Act.

(2) If any such Officer or servant is resisted in the exercise of such power or discharge of such duty, the Magistrate having jurisdiction shall, on a written requisition from such officer or servant, direct any police officer not below the rank of Sub-Inspector to render such help as may be necessary to enable the officer or servant to exercise such power or discharge such duty.

(3) In entering the premises of a religious institution or place of worship, the person authorised by or under Sub-section (1) or the police officer referred to in Sub-section (2) shall, if practicable, ' give notice to the trustee and shall have due regard to the practices and usages of the institution.

21-A. The Commissioner, Deputy Commissioner, Assistant Commissioner, every member of an Area Committee and every other person exercising powers of superintendence or control under this Act, shall, so far as may be, observe forms and ceremonies appropriate to the religious institution in respect of which such powers are exercised and, in the case of a math, act in conformity with the usages of the math in his dealings with the head of the math.

8. Clause (2) of the old Section 21 was left untouched. The Legislature amended Clause (1) of Section 21. Clause (3) of the old section was deleted and a new Clause (3) was added. Section 21-A was new.

9. Apart from the omission of any reference to the Area Committee in the amended Section 21(1), the only change effected in Clause (1) of the amended Section 21 is the addition of 'Officers or servants of a religious institution authorised by the Commissioner, Deputy Commissioner or Assistant Commissioner' to the list of persons entitled to enter the premises of any religious institution, including the Maths. He need not be the servant of the Math, which the officer of the department seeks to enter. He may be a servant of any religious institution. Whatever might be claimed for this amendment, it was certainly not one to cure the invalidity of the section as it stood before the amendment. Even wider powers have been conferred on the officers to depute any one to enter a Math, so long as he is a servant of a religious institution-any religious institution. Section 9 of the Act would, of course, exclude any one other than a Hindu from the category of servants appointed to carry out the purpose of the Act. Every servant of every religious institution may not come within the scope of Section 9 of the Act. But the usage of Hindu Religious institutions, whether they be temples or maths, should normally be a sufficient safeguard against any one other than a Hindu being a servant of such a religious institution. We should not, however, forget that Maths are essentially denominational institutions, and even members of that denomination may not enter the Math itself as of right. The members of the public cannot enter Maths as of right. Entry as of right is not the test which the Act applies to a Math to make it a religious institution within the meaning of the Act. A comparison of the definitions of ' Maths' and 'Temples' in Section 6(10) and (17) respectively of the Act should make that clear. No doubt, Maths are religious institutions and Matadhipathis are ascetics expected to rise above the passions and prejudices that affect lesser mortals. But jealousies and rivalries even between Maths of the same religious sub-section are unfortunately quite common. The trouble that could ensue by deputing a servant of a hated rival to help a Commissioner to exercise his statutory power of control could well be visualised. In considering the validity of an impugned statutory provision, the Court will certainly proceed on the basis, that the statutory authority will exercise the statutory power reasonably, and that such a power would not normally be abused. All the same, to widen the scope of a statutory power already held invalid by the Court does not help to establish the reasonableness of the restriction imposed by Clause (1) of Section 21 on the rights of the Matadhipathis as explained by the Supreme Court.

10. The validity of Clause (1) of the amended Section 21 has to be considered with reference to the rest of Section 21, principally Clause (3) thereof. Clause (1) cannot be isolated. The learned Advocate-General also relied upon Section 21-A.

11. The omission of Clause (3) of the old section, which prohibited any one other than a Hindu from entering the premises of a religious institution, was commented upon by the learned advocate for the petitioners. The learned Advocate-General pointed out that there were sufficient statutory safeguards already in Section 9 of the Act. We have already referred briefly to the scope of Section 9. There is one other aspect to be considered. Clause (3) of the old section would have prevented a police Officer, who was not a Hindu, from entering the premises of a religious institution. Obviously Section 9 could not in terms apply to a police officer. He would not be an officer or servant 'appointed to carry out the purposes of the Act' within the meaning of Section 9. If persons other than Hindus are to be prevented from entering the premises of a Math under the authority of Clause (1) and Clause (2) of Section 21, Section 9 does not furnish a complete statutory safeguard. It is the usage of the Math referred to in Clause (3) of the amended Section 21 that will have to be invoked.

12. The question really comes to this. Do Clause (3) of the amended Section 21 and Section 21-A suffice to validate the otherwise unrestricted and enlarged powers conferred on the Commissioner and other officers of the department by Clause (1) of Section 21, which by themselves constitute a restriction on the rights of Matadhipathis?

13. Clause (3) of the amended Section 21 provides for notice, ' if practicable', before entry is effected. It further provides for 'due regard to the practice and usage of the institution,' In Panachand Gandhi v. State of Bombay : [1954]1SCR1055 , hereinafter referred to for convenience as The Bombay case : [1954]1SCR1055 the Supreme Court upheld the validity of analogous provisions of the Bombay Public Trusts Act. At page 488, Mukherjea, J., observed:

Section 37 (of the Bombay Act) has been objected to on the ground that an unrestricted right of entry in any religious premises might offend the sentiments of the followers of that religion; but the section has expressly provided that the officers making the entry shall give reasonable notice of their intended entry to the trustee and shall have due regard to the religious practice and usages of the trust.

14. Their Lordships of the Supreme Court had no occasion in The Bombay case : [1954]1SCR1055 , to test the validity of the impugned section of the Bombay Act with reference to the fundamental rights of a Matadhipathi. That was the specified viewpoint taken in the Shirur Math case (1954) 1 M.L.J. 596 : (1954) S.C.J.33, where they held that Section 21 as it stood constituted an unreasonable restriction on the fundamental rights of a Matadhipathi. It is with reference to what the Supreme Court stated with reference to old Section 21 in the Shirur Math case (1954) 1 M.L.J. 596 : (1954) S.C.J.33 , that we have to decide whether the amended section is still an unreasonable restriction on the fundamental rights of a Matadhipathi.

15. Even the Bombay Act provided for 'reasonable notice' before entry into the premises of the religious institution. What the amended Section 21(3) of the Madras Act provides for is ' notice if practicable '. The Act itself does not provide for any machinery to decide whether in a given case notice is, or was, practicable or not. We presume it is an objective and not a subjective test, that the Act contemplated and provided for in Section 21(3). The expression ' reasonable notice' certainly postulates an objective standard. Even so, in relation to a Math, the statutory condition 'notice if practicable' is nebulous and uncertain in its operation. A restriction ceases to be reasonable if its scope is uncertain. Before the Legislature provides for the sanctity of the Math and the privacy of the Matadhipathi being violated by the entry of a person under the authority of his office, which is substituted for the consent of the Matadhipathis, the Legislature must realise that the fundamental rights of a Matadhipathi are those guaranteed by the Constitution, and that his position is not that, for instance, of a trustee of a public temple. Where a statutory obligation conflicts with a fundamental right guranteed by the Constitution, obviously the former has to give way and the latter, the fundamental right, will prevail.

16. Despite the saving provision in Clause (3) of the amended Section 21, with its reference to the usage of the religious institution, that is, the Math in this case, we are clearly of opinion that even after the amendment, Section 21 constitutes an unreasonable restriction on the fundamental rights of the Matadhipathi guaranteed by Articles 25 and 26 of the Constitution, and that Section 21 therefore falls within the mischief of Article 13 of the Constitution. It is void and unenforceable against the petitioners as Matadhipathis of Maths.

17. Section 21-A does not help much in deciding whether the provisions of section, 21 are valid. Even if the entry of the persons enumerated in Section 21-A into the premises of a Math is valid, persons who have gained lawful entry will still have to conform to the forms and ceremonies appropriate to the Math. That is all that Section 21-A would appear to provide for. That does not help to solve the question, whether the original entry was lawful under an authority validly conferred by the Act. It should also be noticed that while Clause (1) of the amended Section 21 no longer refers to the members of the Area Committee, they are brought in Section 21-A. Servants of other religious institutions who are included in Section 21(1) as amended do not appear to be within the scope of Section 21 -A. But these are not the features that help the decision one way or the other. It is really independent of Section 21-A we have had to consider the validity of Section 21.

18. Section 30(2) as amended in 1954, was another of the provisions the validity of which was attacked. Clause (1) of Section 30, which did not undergo any change in 1954, authorised a Matadhipathi to incur expenditure (1) on arrangements for securing the health, safety or convenience of disciples, pilgrims or worshippers resorting to the institution; and (2) for the training of archakas, adhyapakas, vedaparayanikas and othuvars.

19. Clause (2) of Section 30, as it was enacted in 1951, ran:

In incurring such expenditure (that is, the expenditure referred to in Section 30(1), the trustee shall be guided by such general or special instructions as may be given by the Commissioner or in the case of an institution over which an Area Committee has jurisdiction, also by such Committee.

The only change effected by the amendment of 1954 was that for the expression 'the trustees shall be guided by', there was substituted 'the trustees shall have due regard to'.

20. The learned Advocate-General referred to Mardala Samigadu v. Paida Srinivasulu Reddy (1919) 11 L.W. 620, Ryots of Garabandho v. amindar of Parlakimedi , and Ramayya v. State of Madras (1951) 2 M.L.J.597 : I.L.R. (1952) Mad. 698, where the expression ' shall have due regard to' occurring in other statutes came up for judicial interpretation. In Ryots of Garabandho v. Zamindar of Parlakimedi , their Lordships of the Privy Council (at page 501) approved of the view taken by the Board of Revenue.

that the requirement' to have due regard to' the provisions in question had no more definite or technical meaning than that of an ordinary usage and only required that these provisions must be taken into consideration.

At page 503, however, their Lordships observed:

The expression ' have regard to ' or expressions very close to this are scattered throughout this Act (Madras Estates Land Act I of 1908). But the exact force of each phrase must be considered in relation to its context and to its own subject matter. Any general interpretation of such a phrase is dangerous and unnecessary but it is fairly clear as a matter of English that the view taken by the majority of the Collective Board is nearer to the ordinary meaning of the phrase ' have regard to ' when it appears in a statute than is that of the dissentient member.

Commenting upon Section 30(2) as it stood before the amendment, which required the Matadhipathi to be guided by the instructions given by the Commissioner in incurring the expenditure referred to in Clause (1) of Section 30, their Lordships of the Supreme Court observed at page 354 in the Shirur Math case (1954) S.C.J. 335 : (1954) 1 M.L.J. 596.

The provision of Section 30(2) appears to us to be somewhat obscure. If the trustee is to be guided but not fettered by such directions, possibly no objection can be taken to this clause; but if he is bound to carry out such instructions, we do think it constitutes an encroachment on his right. Under the law, as it stands, the Mahant has large powers of disposal over the surplus income and the only restriction is that he cannot spend anything out of it for his personal use unconnected with the dignity of his office. But as the purposes specified in Sub-clauses (a) and (b) of Section 30(1) are beneficial to the institution, there seems to be no reason why the authority vested in the Mahant to spend the surplus income for such purposes should be taken away from him and he should be compelled to act in such matters under instructions of the Government Officers. We think that this is an unreasonable restriction on the Mahant's right of property which is blended with his office.

These objections still stand even after the amendment which, as we pointed out, only substituted ' shall have due regard to ' for the requirement ' shall be guided by '. The need for the second clause of Section 30 remains as obscure as ever even after the amendment. The learned Advocate-General stated that Clause (2) of Section 30 would really be superfluous in relation to Maths. If the items enumerated in Clause (1) of Section 30 are provided for in a budget, Section 70(3) gives the Commissioner ample powers. That was what the learned Advocate-General pointed out. We are not at this stage concerned with the provisions of Section 70 of the Act, the validity of which was upheld in the Shirur Math case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335.). Clause (1) of Section 30 itself is only permissive in its scope. A Matadhipathi is not bound to provide for the items enumerated in Clause (1) of Section 30 in the budget. But if he is prepared to spend money on those purposes, his right to spend the money is there, as pointed out by the Supreme Court in the passage extracted above. In the context of Section 30(2) it does not appear to us that the Legislature intended that the role of the Commissioner should be purely advisory, when it enacted that a Matadhipathi shall pay due regard to the instructions of the Commissioner. As pointed out by the Supreme Court, if Clause (2) of Section 30 was designed as a fetter on the right of the Matadhipathi to spend the income even for the purposes, enumerated in Clauses (a) and (b) of Section 30(1) it would be an unreasonable restriction on the fundamental right of the Matadhipathi. Section 30(2), even as amended, constitutes an unreasonable restriction, on the'Matadhipathi's powers of disposal over the income of Math. Designed as a fetter on the Matadhipathi's power of disposal, Section 30(2) as it now stands amended, has to be struck down as void and unenforceable in its application to the petitioners as Matadhipathis of their Maths.

21. Section 31 of the Act was also held by the Supreme Court in the Shirur Math case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335, to be void and unenforceable against Maths and Matadhipathis. Clause (1) of Section 31, as it originally stood, provided that, if there was any surplus in the income after making provision in the budget under Section 70(2) and also for the items specified in Section 30(1)of the Act, the trustee, that is, the Matadhipathi, may, with the previous sanction in writing of the Deputy Commissioner, appropriate such surplus or any portion thereof for all or any of the purposes specified in Section 59(1). Section 59(1), it should be remembered, provided for the application of the funds of defunct religious institutions on the principle of cypres.

22. The salient features of Section 31(1) as it stood before the amendment, were that it applied only to the surplus of the annual income; utilisation of that surplus was left to the trustees, that is, the Matadhipathi. He had the initiative. He was empowered to apply to the Deputy Commissioner for permission to appropriate the surplus of the annual income for any purpose mentioned in Section 59(1) of the Act. If the sanction was accorded, the trustee or Matadhipathi could utilise the surplus income. That, as the learned Advocate-General rightly pointed out, did not give a statutory power to the Deputy Commissioner to direct himself the utilisation of the surplus income of the religious institution; in this case we are concerned only with Maths. In Pearson's case L.R. (1872) Ch. App. 309, it was held that where the statute empowered the liquidator to accept a compromise with the sanction of the Court, the Court had no power to compel the liquidator to accept the compromise. James, L.J., observed:

I am of opinion that the only power is in the liquidator with the sanction of the Court and that there is no power in the Court to order a compromise whether the liquidator recommends it or not.

See also Chiragh Din v. The Official Liquidator, The Peoples Bank of Northern India, Ltd., (in liquidation); Lahore I.L.R. (1939) Lah. 324.

23. Thus the position under Section 31(1) as it stood before the amendment, was that the trustees could ask for sanction to utilise the surplus of the annual income. If the trustee did not move in the matter, the Deputy Commissioner would have had no jurisdiction to issue any directions. Even with reference to such a restriction on the Matadhipathi's right to utilise the income of the Math, the Supreme Court pointed out in the Shirur Math case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335:

One of the purposes mentioned in Section 59(1) is the propagation of the religious tenets of the institution and it is not understood why sanction of the Deputy Commissioner should be necessary for spending surplus income for the propagation of the religious tenets of the order which is one of the primary duties of the Mahant to discharge. The next thing that strikes one is, whether sanction is necessary if the trustee wants to spend the money for purposes other than those specified in Section 59(1)? If the answer is in the negative, the whole object of the Section (section 31(1)), becomes meaningless. If, on the other hand, the implication of the section is that the surplus can be spent only for the purposes specified in Section 59(1) and that too with the permission of the Deputy Commissioner, it undoubtedly places a burdensome restriction upon the property rights of the Mahant which are sanctioned by the usage and which would have the effect of impairing his dignity and efficiency as head of the institution.

Section 31 was held to be invalid and unenforceable against the Matadhipathi.

24. The learned Counsel for the petitioners was certainly well founded in his contention, that the amendment of Section 31 effected in 1954, with the professed object of curing the defects pointed out by the Supreme Court really made the position of the Matadhipathi much worse than what it was under Section 31 before it was amended.

25. Reference to Section 59(1) of the Act was omitted in the amended Section 31(1). Clause (1) of Section 31 now empowers the Commissioner to direct the utilisation of any surplus of funds in a Math or other religious institution to be appropriated to religious, educational or charitable purposes. Clause (2) empowers he Commissioner to direct that portion of the surplus should be retained as a reserve fund for the Math. Clause (4) entitles the Matadhipathi within six months of the date of the publication of the order of the Commissioner to institute a suit in a Court to modify or set aside such an order. Clause (5) empowers the Court to modify its own order.

26. Thus the initiative that was left with the Matadhipathi to seek permission for the utilisation of the surplus of the annual income was taken away by the amended Section 31(1). While the old Section 31(1) referred only to the surplus of the income, the amended Section 31(1) refers to even surplus accumulated by careful management, and virtually the whole of that surplus is placed at the disposal of the Commissioner, no doubt for utilisation for religious, educational or charitable purposes, which purposes may not be connected with the Math itself. The amended section in effect entirely divests the Matadhipathi of his power of disposal of the income and the accumulated surplus of the income. When the Supreme Court pointed out that the control imposed by the unamended Section 31(1) over the comparatively unlimited power of disposal a Matadhipathi had over the income of the Math was itself an unreasonable restriction on the Matadhipathi's fundamental rights, it is certainly difficult to sustain any claim, that the amended Section 31(1) which divests the Matadhipathi of all control, would amount to a reasonable restriction on the Matadhipathi's fundamental rights.

27. No doubt, Clauses (4) and (5) of the amended Section 31 give an aggrieved Matadhipathi a right of recourse to civil Courts. Whatever may be the scope of the jurisdiction intended to be vested in the civil Court under Section 31, that provision would not by itself make an unreasonable restriction on the Matadhipathi's fundamental right a reasonable restriction.

28. We have no hesitation in holding that the amended Section 31 constitutes an unreasonable restriction on the fundamental rights of the Matadhipathi guaranteed by Articles 19, 25 and 26 of the Constitution and is therefore void under Article 13 and unenforceable against Maths and Matadhipathis.

29. During the arguments with reference to Section 30(2) and Section 31, the learned Counsel for the petitioners brought to our notice some of the orders passed under Section 70(3) with reference to the budgets submitted by one or the other of the petitioners before us. The validity of Section 70 of the Act does not arise for consideration at this stage. Its validity has been upheld by the Supreme Court. The validity of individual orders passed under Section 70(3) does not arise either for consideration in these proceedings. As the learned Advocate-General pointed out, that the validity of the provisions of Section 70 has been upheld and that the statutory power vested in the Commissioner is valid would not necessarily make every order passed by the Commissioner a valid one; that is, every order may not amount to a valid exercise of the statutory power. It is certainly open to the petitioners to have the correctness of any impugned order passed under Section 70(3) by the appropriate authority challenged in appropriate proceedings. We therefore refrain from saying anything now with reference to the individual instances brought to our notice. Nor do we say anything on the truth of the contention of the learned Counsel for the petitioners, that the powers under Section 70(3) are really being utilised by the statutory authorities to build up a surplus, so that the powers vested in them under Sections 30 and 31 of the Act could operate to a greater extent. If that could be proved, then, of course, it would be a clear case of misuse of the statutory powers vested in the statutory authorities under Section 70(3) of the Act. We should like to emphasise that the statutory power vested in the Commissioner under Section 70(3) of the Act should be exercised in the light of what has been declared by the Supreme Court to be the fundamental rights of the Matadhipathis and what would constitute reasonable restrictions thereon.

30. It is on the basis of old Section 31, the observations of the Supreme Court thereon and the provisions of the present amended Section 31 that we have come to the conclusion, that the present Section 31 falls within the mischief of Article 13 of the Constitution in relation to Maths and Matadhipathis, with whom alone we are now concerned. It may not therefore be necessary to refer to the provisions of the Orissa Act which were upheld in Rananuja Das v. State of Orissa (1954) 1 M.L.J. 591 : 1954 S.C.J. 329, or the provisions of the Bombay Act which were declared invalid in The Bombay case. : [1954]1SCR1055 .

31. Section 52 of the Act provides for institution of suits in a civil Court for the removal of a Matadhipathi on any of the grounds mentioned in Section 52(1). The validity of Section 52 did not arise for consideration in the Shirur Math case (1954) S.C.J. 335 : (1954). M.L.J. 596. That a Matadhpathi was liable to be removed in a suit brought under Section 92, Civil Procedure Code, was well settled. See Satischandra.Giri v. Dharam Dhar Singh, Raj I.L.R. (1940) 1 Cal. 266. It was, this principle that underlay Section 52 of the Act.

32. To the six grounds enumerated in Section 52(1) as it was enacted in 1951, three more where added by the Amending Act of 1954. Of these, Clause (f) of the amended Section 52 specifies ''Waste of funds or properties of the institution or the application of such funds or properties for purposes unconnected with the institution.' It was the validity of this clause that was challenged by the petitioners. They contended that it constituted an unreasonable restriction on the fundamental right of the Matadhipathi, who has a larger power of disposal over the properties and the income of the Math. The learned Counsel for the petitioner pointed out that the Matadhipathis of some of the Udipi Maths have been contributing to the maintenance of educational institutions, which could not be said to be directly connected with the Math as such and the learned Counsel urged that a strict interpretation of Section 52(1)(f) would make even such an expenditure a ground for the removal of the Matadhipathi. We do not apprehend any such trouble. Section 52(1) it should be remembered, empowers a Commissioner or persons authorised by him to move the Court to remove a Matadhipathi on any of the grounds mentioned in Section 52(1) as it now stands amended. It is for the Court to consider, even with reference to Section 52(1)(f) as it stands, whether a case for removal has been made out. Certainly the petitioner should not be under any apprehension, that a Court, which is invited to consider whether a case for removal has been made out under Section 52(1)(f) of the amended Act, would blind itself to the declaration of law by this Court and by the Supreme Court of what the Matadhipathi's real position is, and what his powers of disposal of the properties and the income of the Math are. The very nature of the institution, the Math, of which the Matadhipathi is the spiritual head and is in charge of the temporal affairs of the Math, the two being inextricably blended, should be a sufficient safeguard against any narrow and unwarranted interpretation of Section 52(1)(f) of what is the expenditure ' unconnected with the institution'. The ' institution ' certainly takes in the office of the Matadhipathi as well. As has been pointed out by this Court and by the Supreme Court in the Shirur Math case I.L.R. (1940) Cal. 266, the real limitations on the Matadhipathi are that he should not spend any of the monies of the Math for wicked or immoral purposes. Certainly, wicked and immoral purposes would be purposes unconnected with the institution within the meaning of Section 52(1)(f) of the Amended Act. Since Section 52(1)(f) would have to be construed in the light of the law on the subject of the Matadhipathi's rights to expend monies of the Math, as explained by the Supreme Court and the law has to be applied and enforced by the ordinary civil Courts of the land, we are unable to hold that Section 52(1)(f) constitutes an unreasonable and unconstitutional restriction of the fundamental right of the Matadhipathi.Both Clauses (1) and (2) of the Section 55 as they were enacted in 1951 were declared invalid by the Supreme Court in the Shirur Math case (1954) 1 M.L.J. 596 : 1954 S.C.J. 335 These provisions related to Pathakanikas. The nature of the Pathakanikas was explained by the Supreme Court at page 355 in the Shirur Math case (1954) 1 M.L.J. 596 : 1954 S.C.J. 335

Ordinarily a Mahant has absolute power of disposal over such gifts though if he dies without making any disposition it is reckoned as a property of the Math and goes to the succeeding Mahant. It may be that according to customs prevailing in a particular institution, such personal gifts are regarded as gifts to the institution itself and the Mahant receives them only as the representative of the institution; but the general rule is otherwise.

It was with reference to these observations that Section 55 was amended, and it now runs:

The trustee of a math shall keep regular account of' Pathakanika ' that is to say, any gift of property made to him as the head of the math and shall be entitled to spend the said ' Pathakanika ' in accordance with the customs and usages of the institution.

33. The contention of the petitioners was that, even as it stands, this provision constitutes an unconstitutional restriction on the rights of a Matadhipathi.

34. The learned Advocate-General pointed out that what is offered as a personal gift to the Matadhipathi is outside the scope of Section 55 as it now stands amendeds What falls within the scope of Section 55 is only an offering made to the Math as such, though no doubt the offering is made to the Matadhipathi, the Matadhipathi representing the Math to which the gift is made. Section 55 is well within the bounds, set by the Supreme Court in the Shirur Math case (1954) 1 M.L.J. 596 : 1954 S.C.J. 335. So ran the argument.

35. The Supreme Court pointed out that the general rule is that Pathakanikas are offered as personal gifts to the Matadhipathis. It may be that the usage of an institution is that Pathakanikas are accepted as gifts to the Math itself represented by the Matadhipathi. It may be that in exceptional cases a devotee specifically makes his offerings through the Matadhipathi to the Math itself. The distinction is thus drawn between a personal offering to the Matadhipathi and an offering to the Math represented by the Matadhipathi. The learned Advocate-General conceded that the Legislature intended to exclude from the scope of the amended Section 55, the first class of offerings, that is, offerings of Pathakanikas as personal offerings to the Matadhipathi. We agree that is the true scope of the amended Section 55.

36. The next question is, does the amended Section 55 constitute an unreasonable restriction of the rights of a Matadhipathi even within the limited scope of Section 55, that it includes only offerings to the Math, no doubt made through the Matadhipathi as the head and representative of the Math. If such offerings merge in the general income of the Math, Section 55 casts no heavier obligation on the Matadhipathi than the obligation that he should keep regular accounts of income and expenditure of the Math. That would certainly be a reasonable, restriction, even though the secular and spiritual facets of the Matadhipathi's office are inextricably blended. The further stipulation in Section 55 is that the Matadhipathi shall be entitled to spend the Pathakanikas, which had merged in the general income of the Math, in accordance with the customs and usages of the Math itself. That again would not constitute an unreasonable restriction of the Matadhipathi's right. We have referred earlier to the fact, that the Matadhipathi is as much a part of the institution as the Math itself. We have also adverted to the legal right of the Matadhipathi, which gives him a large power of disposal over the income of the Math. the virtual restrictions being only that he should not spend the money of the Math for any illegal or immoral purposes, or as the Supreme Court put it ' immoral or wicked purposes.' These would still be the only restrictions, despite reference to the custom and usage of the institution in Section 55 of the Act. If that power of disposal is not restricted further, and, in our opinion, Section 55 does not restrict it beyond the limits we have specified above, what has been declared to be the right of the Matadhipathi in Section 55, to spend such pathakanikas in accordance with the customs and usages of the institution, cannot amount to an unreasonable restriction on the Matadhipathi's rights even as the head of the Math. Virtually, a declaration, that he would be entitled to spend the money in accordance with the customs and usages of the institution, would be superfluous, because that right is always there. But merely on the ground of superfluity, even that portion of Section 55 cannot be struck down as an unconstitutional restriction on the right of the Matadhipathi.

37. The true scope of the amended Section 55 we have endeavored to set out above We hold that Section 55, as it now stands amended, is valid.

38. Before we deal with the other provisions of the Act, the validity of which also was challenged, we shall dispose of the question of the validity of one of the rules framed by the Government under the Act. Rule 10 of the Rules framed under Section 100(2)(y) of the Act runs:

The pay and emoluments in cash and in kind of each officer and servant shall be in accordance with a schedule of establishment framed by the trustee and approved by the Area Committee in the case of institutions under the jurisdiction of the Committee and by the Commissioner in the case of other institutions. The trustees shall not alter the schedule without the previous permission of the Area Committee or the Commissioner as the case may be.

Again we should emphasise that we are concerned with the validity of this rule only in its application to Maths and Matadhipathis. As the rule stands, it certainly imposes an unreasonable restriction on the right of the Matadhipathi to manage the affairs of the Math. It would certainly appear to come within the mischief of what the Supreme Court categorically declared would constitute an unreasonable restriction if the restrictions are such as would bring the Matadhipathi down to the level of a servant under a State Department, it would certainly constitute an unreasonable restriction. It may be a laudable attempt on the part of the Government to standardize the conditions of service in religious institutions including the Maths. But in relation to Maths they cannot claim that power in derogation of the Matadhipathis's right of management of a denominational institution like a Math.

39. The learned Advocate-General conceded that Rule 10 would amount to an unreasonable restriction on the Matadhipathi's rights, as they have been declared by the Courts of the land. We hold that Rule 10 is ultra vires the rule-making power conferred on the Government and is unenforceable against Maths and Matadhipathis.

40. Controversy centered most over the provisions of the Act dealing with the annual ' contributions ' payable by religious institutions from out of their annual income. Section 76(1) as enacted in 1951 prescribed 5 per cent, of the annual income as the maximum and specified that contribution was ' in respect of the services rendered by the Government and its officers' to the religious institution. Clause (1) of Section 76 provided for a further annual payment not exceeding 1 1/2 per cent, of the income of the religious institution to meet the cost of audit of the accounts of that religious institution. Both sets of amounts were payable to the Government. The Supreme Court held in the Shirur Math Case (1954) 1 M.LJ. 596 : (1954) S.C.J. 335, that the contribution payable under Section 76(1) as it was enacted in 1951, was not a fee but a tax, and that it was beyond the legislative competence of the State Legislature to levy such a tax.

41. The relevant provisions of Section 76 as it was amended in 1954 run:

(1) In respect of the services rendered by the Government and their Officers and for defraying the expenses incurred on account of such services every religious institution shall, from the income derived by it, pay to the Commissioner annually such contribution not exceeding five per centum of its income as may be prescribed.

(2) Every religious institution, the annual income of which, for the fasli year immediately preceding as calculated for the purposes of the levy of contribution under Sub-section (1) is not less than one thousand rupees, shall pay to the Commissioner annually, for meeting the cost of auditing its accounts, such further sum not exceeding one and a half per centum of its income as the Commissioner may determine.

42. Sub-sections (3) and (4) of Section 76, as they were originally enacted in 1951, were retained without any change. Since the validity of these clauses was never in issue, there is no need to refer to them again.

43. Sub-section (5) and an Explanation were added to Section 76 by Amending Act of 1954. Sub-section (5) ran:

Whenever there is any surplus after meeting all the charges referred to in the foregoing Sub-section (i.e., Sub-section (4)) it shall be lawful for the Commissioner, acting suo motu or on an application to make grants to poor and needy religious institutions for carrying out repairs and renovation subject to such rules as may be framed by Government in this regard.

The Explanation ran:

Any religious institution, the annual income of which is less than two hundred rupees, shall not be liable to pay any contribution to the Commissioner as required by Sub-section (1).

44. The Amending Act added three sections, which now stand numbered as 80, 81 and 82. Section 80 directed that the Commissioner shall be a corporation sole. Section 81 provided for the establishment of a fund to be called the Madras Hindu Religious and Charitable Endowments Administration Fund, into which were to be paid all the contributions collected from religious institutions under sub-sections (1) and (2) of Section 76. That fund was vested in the Commissioner. Section 82 gave retrospective effect to these amended provisions, and it also validated the levies under sub-sections (1) and (2) of Section 76 as they stood before they were amended in 1954.

45. The constitution of a separate fund, vested in the Commissioner, was the main change that was effected by the Amending Act of 1954. The amounts collected from the religious institutions by way of contribution under sub-sections (1) and (2) of Section 76, as they were amended, no longer merged in the consolidated fund of the State. They were not monies payable to the Government as such. Sub-section (1) of Section 76 specified that the contribution paid by the religious institution was for defraying the expenses incurred on account of the services rendered by the Government and its Officers. Sub-section (5) and the Explanation to 76 were new.

46. It may be noted that the Legislature still refrained from expressly labelling the payments prescribed by sub-sections (1) and (2) of the amended Section 76 as ' fees'. That of course, does not affect the determination of the main question at issue now; do the payments prescribed by sub Sections (1) and (2) of Section 76 constitute fees, to levy which the Legislature undoubtedly had the legislative competence See Entry 47 read with Entries 10 and 29, particularly 28, of List III of the VIIth Schedule to the Constitution.

47. The initial presumption, of course, is in favour of the validity of the statutory provision, that is, in favour of the claim of the Government, that what Section 76(1) authorised is a fee, intra vires the Legislature. If, however, despite the legislative amendments, the levy still amounts to a tax, obviously that would be ultra vires the Legislature. It could never be claimed, and in fact it was not claimed, that the State Legislature had the power to levy a tax in respect of the matters specified in Entires 10 and 28 of Lists III of Schedule VII. The distinction between a fee and a tax therefore becomes of fundamental importance though, as the Supreme Court pointed out at page 334 of The Orissa case (1954) 1 M.L.J. 591 : (1954) S.C.J. 329 and at page 360 of the Shirur Math Case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335, there is no generic difference between a tax and a fee, and both are different forms in which the taxing power of the State manifests itself.

48. The distinction between a tax and a fee for legislative purposes had its original in the legislative practice of the United Kingdom. The British Parliament, familiar with that distinction, carried it into the Government of India Act, 1935. That distinction was maintained by our Constitution-makers. Mr. Venkatasubramania Ayyar, learned Counsel, for one of the petitioners, traced the evolution of the concept of a fee, which is freed of the special privileges accorded to a money bill. It may not, however, be necessary to discuss that aspect in any great detail now. The Supreme Court had to consider the validity of the provisions of the Bombay, Orissa and the Madras Acts, each of which provided for the payment of monies from out of the income of religious institutions. Mukherjea, J., as he then was, discussed the difference between a tax and a fee at considerable length in the Shirur Math Case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335, with reference to the Madras Act. Those principles were restated in The Bombay Case : [1954]1SCR1055 , and in The Orissa Case (1954) 1 M.L.J. 591 : (1954) S.C.J. 329, it was on the application of those basic principles expounded in the Shirur Math Case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335, that the Supreme Court negatived the validity of the provisions of the Madras Act, while it upheld the validity of the provisions of the Bombay and the Orissa Acts. It is those principles that we have to apply now, in deciding whether the provisions of the Amended Act, the validity of which is now impugned, provided only for the payment of a fee.

49. At pages 358-359 in his judgment in the Shirur Math Case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335, Mukherjea, J. laid down.. a fee is generally defined to be a charge for a special service rendered to individuals by some governmental agency. The amount of fee levied is supposed to be based on the expenses incurred by the Government in incurring the service, though in many cases the costs are arbitrarily assessed. Ordinarily, the fees are uniform and no account is taken of the varying abilities of different recipients to pay. These are undoubtedly some of the general characteristics, but as there may be various kinds of fees, it is not possible to formulate a definition that would be applicable to all cases.

After pointing out that the element of compulsion or coerciveness is common both to taxes and to fees, though possibly of varying degrees, Mukherjea, J., observed that factor was not even a material criterion in distinguishing a fee from a tax. It followed that the willingness or unwillingness of the person, who was called upon to pay the fee, to receive the service proposed to be rendered, could not be a real test either. Mukherjea, J., stated:

We agree however with the learned Attorney-General that in the present day concept of State it cannot be said that the service can be rendered by the State only at the request of those who require those services. If in the larger interests of the public a State considers it desirable that some special service should be done for certain people, the people must accept those services whether willing or not.

At page 359 His Lordship laid down:

The distinction between a tax and a fee lies primarily in the fact that a tax is levied as a part of a common burden, while a fee is a payment for a special benefit or privilege. Fees confer a special capacity, although the special advantage, as for example in the case of registration fees for documents or marriage licences, is secondary to the primary motive of regulation in the public interest. Public interest seems to be at the basis of all impositions, but in a fee it is some special benefit which the individual receives. As Seligman says, it is the special benefit accruing to the individual which is the reason for payment in the case of fees; in the case of a tax, the particular advantage, if it exists at all, is an incidental result of State action.

50. With reference to the establishment of a separate fund, into which the fees collected by the Government, could be paid Mukherjea, J., observed at page 360;

If the money thus paid is set apart and appropriated specifically for the performance of such work and is not merged in the public revenues for the benefit of the general public, it could be counted as fees and not a tax.

The learned Judge pointed out later at page 361 that this factor by itself might not be conclusive. The payment into a separate fund, which does not merge in the consolidated fund of the State, is thus at best only an indication, possibly with strong evidentiary value, that the levy is intended by the Legislature to be a fee for services rendered. It is not a conclusive test, as their Lordships of the Supreme Court themselves categorically laid down. Payment into the consolidated fund would still be consistent with the levy being a fee for services rendered. Equally, so payment into a separate fund would not by itself remove a levy outside the pale of controversy, whether the levy is in fact a fee.

51. Another test in deciding whether a given levy is a fee was postulated by Mukherjea, J., at page 359:

If, as we hold, a fee is regarded as a sort of return or consideration for services rendered, it is absolutely necessary that the levy of fees should, on the face of the legislative provision, be co-related to the expenses incurred by Government in rendering the services.

52. It was on an application of these principles that Mukherjee, J., summed up his conclusion, that Section 76(1) as it was enacted in 1951, was beyond the power of the State Legislature. The learned Judge observed:. in this case there is total absence of any co-relation between the expenses incurred by the Government and the amount raised by contribution under the provision of Section 76 and in these circumstances the theory of a return or counter-payment or quid pro quo cannot have any possible application to this case.... The contribution levied under Section 76 is a tax and not a fee and consequently it was beyond the power of the State Legislature to enact this provision.

From what we have set out above it would appear that the following tests will have to be satisfied before the contribution levied under Section 76(1) as it now stands amended, can be upheld as a fee, within the legislative competence of the State Legislature to enact.

53. (1) The levy can be justified as intra vires the State Legislature, only if it falls within the ambit of Entry 47 read with Entry 28 in List III of VIIth Schedule of the Constitution.

54. (2) There should be a quid pro quo basis to justify the levy as a fee. The co-relation between the fee levied and the services rendered should appear ex facie the legislative provision. The co-relation must exist both in the purpose of the levy and the extent of the levy, that is, the co-relation should be between the actual levy and the expense incurred by the Government for rendering the services for which the levy is made.

55. (3) The services rendered by the Government, which constitute the quid pro quo for the levy of the fee, must be incidental to a system of regulation.

56. (4) That regulation itself must be solely on considerations of public interests.

57. (5) That Statutory regulation should not exceed the limits of a reasonable restriction on the fundamental rights guaranteed by the Constitution.

58. One feature of Section 76(1) as it now stands, may be considered at this stage. It only specifies the maximum for the levy at 5 per cent. of the income of the religious institution. The actual levy itself, as a fee, has to be at the rates ' prescribed '. Section 6(12) of the Act defines ' prescribed':

'Prescribed ' means prescribed by the rules made by the Government under this Act.

We are now dealing only with Section 76(1). The rates have to be prescribed by the Government. Under Section 76(2) it should be remembered, the rates have to be prescribed by the Commissioner. In fixing the maximum for the levy, which is claimed to be a fee, the Legislature cannot be said to have acted in excess of its powers, provided, of course, what is levied is a fee, and the levy is within the Legislative competence of the State Legislature. In the Bombay Act, it should be remembered, no maximum was specified and the validity of the statutory provision was, upheld. Specification of a maximum for the levy, therefore, cannot be a material factor at all in deciding whether a given levy is a fee or not. Those considerations, of course, would not apply when the validity of a 'prescribed' levy, that is, a levy made under the rules prescribed by the Government as the rule-making authority, has to be considered.

59. The petitions, with which we now deal, were filed in April and May, 1955. Subsequent to that, on nth June, 1955, the Government issued rules under the rule-making power vested in it by Section 100(2)(o) of the Act, regulating the scale of contributions. It was a graduated levy, all within the maximum of 5 per cent. specified by Section 76(1). The levy was based on the capacity to pay, that is, on the annual income of the religious institution. Rule 1 of these Rules prescribed the following rates: (1)3 per cent. for religious institutions with an annual income between Rs. 200 and Rs. 3,000; (2) 3 per cent. for incomes between Rs. 3,001 and Rs. 10,000; (3) 4 per cent. where the income is between Rs. 10,001 and Rs. 20,000; (4) 4 per cent, for incomes between Rs. 20,001 and Rs. 60,000; and (5) 5 per cent. the maximum, where annual income exceeds Rs. 60,000.

60. We have refrained from considering the validity of the rule. It did not arise for consideration on the pleadings in these cases. We propose to confine ourselves to the validity of Section 76(1). As we pointed out earlier, that it prescribed a maximum of 5 per cent. of the annual income in no way helps to determine either the validity or the invalidity of the statutory provision, and it may not have any bearing on the question whether it is a fee that Section 76(1) authorised.

61. Mr. Venkatasubramania Ayyar however urged that the 5 per cent. in Section 76(1) was not so innocuous as it might appear at first sight. The maximum permitted by Act II of 1927 was 1 per cent. By the amendment effected in 1944, the maximum was raised to 3 per cent. That itself left a substantial surplus which the State took over from the Hindu Religious Endowments Board when Act XIX of 1951 repealed Act II of 1927. In the course of his arguments, Mr. Venkatasubramania Ayyar referred to the Reports of the proceedings of the Madras Legislative Assembly, and pointed out that in an answer given by the Government on the floor of the Legislature, the Government admitted that on the eve of Act XIX of 1951, the position was, that there was a surplus of Rs. 59 lakhs minus liabilities to the extent of about Rs. 13 lakhs. From the figures furnished by the Government during the course of the arguments, it would appear that a large surplus was possible only after the rates were raised from 1 per cent. to 3 per cent. that is, after 1944. Mr. Venkatasubramania Ayyar contended that in raising the maximum to 5 per cent. the Legislature deliberately intended to provide for even a much larger surplus. What the Legislature intended in 1951 may not be material now, when we are considering the validity of the provision enacted in 1954. Mr. Venkatasubramania Ayyar pointed out that though the statutory maximum was 5 per cent., what was actually levied under the Rules in 1951 was only 3 per cent. Despite that, and the observations of the Supreme Court in the Shirur Math Case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335, the maximum of 5 per cent. was retained in 1954. If the intention of the Legislature was in any doubt, Mr. Venkatasubramania Ayyar argued, the addition of Sub-section (5) to Section 76 removed it. The Legislature provided for a surplus so that poor and needy religious institutions could be helped out of the contributions collected under subsections (1) and (2) of Section 76. So ran the argument.

62. The impugned validity of Section 76(1) has to be decided independently of the obvious invalidity of Sub-section (5) with which we shall deal a little later. Suppose no maximum had been fixed at all by the statute, would that by itself have affected the validity of Section 76(1)? Failure to specify a maximum did not affect the validity of the corresponding provisions of the Bombay Act, which was upheld by the Supreme Court. Statutory provisions are meant to be comparatively more static than the Rules framed under the Act. If a real co-relation is to be maintained at all times between the fee actually levied and the service rendered, for which the fee is levied, the advantage of a flexible machinery like a delegated rule making power should be obvious. Now that there is a separate fund administered by the Commissioner it should be easier for the Government to exercise its delegated power well within the legal limits. If there is a surplus of income over expenditure, the Government can and is obviously expected to revise the rates of levy, to keep as near as possible to the real quid pro quo basis for the levy of the fee. The need for such periodical revisions is implicit, when the Act specifies only the maximum and entrusts the duty of fixing the quantum of levy within that maximum to the Government, as the authority empowered by the Legislature to frame the necessary rules. It may be an onerous responsibility. But that is implicit in a greater or lesser degree in every case of lawful delegation of powers. The rule has to be intra vires the rule-making authority. Even if Section 76(1) is valid that would not by itself validate the 'prescribed' rate, that is, the rate prescribed from time to time, the validity of which will have to be substantiated if it is challenged. In the very nature of things, there can be nothing static about the rates to be prescribed for the levy authorised by Section 76(1).

63. The validity of the delegation was never really in dispute. In In re The Delhi Laws Act, : [1951]2SCR747 Das, J, quoted with approval the principle laid down by Lord Atkin in Shannon v. Lower Main and Dairy Products Board L.R. (1938) A.C. 708:

The third objection is that it is not within the powers of the Provincial Legislature to delegate so called legislative powers to the Lieutenant-Governor in Council, or to give him powers of further delegation. This objection appears to their Lordships subversive of the rights which the Provincial Legislature enjoys while dealing with matters falling within the classes of subjects in relation to which the Constitution has granted legislative powers. Within its appointed sphere the Provincial Legislature is as supreme as any other Parliament; and it is unnecessary to try to enumerate the innumerable occasions on which Legislatures, Provincial, Dominion and Imperial, have entrusted various persons and bodies with similar powers....

64. Even as a Court, the Legislature expects that the rule-making power would be exercised by the delegated authority within the limits imposed by law. Specification of a maximum of 5 per cent. is certainly not a direction to the rule making authority to prescribe the levy at that rate alone. Neither the specification of the maximum nor the delegation of the power to prescribe a fee can invalidate Section 76(1).

65. We have already recorded that we shall refrain from examining the validity of the Rules prescribing the rates for levy published by the Government in August, 1955. The question did not arise on the pleadings. The data, which the Government alone could, in the circumstances of the case, have furnished, were not adequate. But then we were not called upon to consider the validity of the rates. It may be that the Government will realise the need to revise the Rules to bring the rates to be prescribed in conformity with the requirements of law. They must maintain the standard as explained by Shah, J., in Ratilal v. State of Bombay : AIR1953Bom242 .. The test is whether in providing the service for which the levy is collected by the State, the State levies an amount approximating to the expenses for providing the service and disburses it for supplying that particular service. If the total levy bears a just and true relation to the cost of providing the service and the levy is not mixed up with the general revenues of the State, then in my view it would be regarded as a fee and not a tax.

66. At page 765 of May's Parliamentary Practice, 15th edition is the passage:

Payments which are intended to cover the expenses of a Government department in performing services for the public or sections of the public and are retained by the department are not regarded as charges that is, ' taxes ' which is expression used according to the Indian Legislative practice. Such payments may take the form of fees or licences.

This rule is not allowed to make legitimate charges so disproportionate to. the cost of the services rendered as to amount to taxation.

These restrictive principles would certainly apply to the rules prescribing the actual levy.

67. In the view we are taking, that the validity of Section 76(1) has to be considered independently of the validity of such Rules as may be prescribed from time to time by the Government we have considered it unnecessary to set out in detail the cases cited before us during the arguments, which applied well settled principles in deciding whether the test of reasonableness had been satisfied by the challenged exaction in each of those cases; We shall content ourselves with a brief reference to some of those cases.

68. In Corporation of Madras v. Spencer and Co : AIR1930Mad55 , Philips, J., referred to the oft quoted dicta of lord Russel in Kruse v. Johnson L.R.(1893) 2 Q.B. 91, of what constituted unreasonableness:

If for instance, they (that is, the bye-laws) were found to be partial and unequal in their operation as between different classes; if they were manifestly unjust; if they disclosed bad faith; if they involved such oppressive or gratuitous interference with the rights of those subject to them as could find no justification in the minds of reasonable men....

See also India Sugars and Refineries Ltd. v. Municipal Council, Hospet : AIR1943Mad191 and Varadachari v. State of Madras (1952) 2 M.L.J. 410.

69. Mr. Venkatasubramania Ayyar referred to Sprout v. City of South Bend 72 L.Ed. 833, where it was held that a flat tax substantial in amount may not satisfy the requirement of the police power, that is, the quid pro quo test, if it is to be viewed as a fee. In Steward Dry Goods Co. v. Lewis 79 L. Ed. 1054, it was pointed out that gross inequity in the incidence of the levy could not be justified by a plea of ease of collection. In Ingles v. Morf 81 L.Ed. 653, it was held at page 659 that on the evidence in that case it was proved that the cost of policing, that is, supervision, would be amply met by a licence fee of one-third of the amount actually charged; the levy was struck down as unconstitutional. It is, however, necessary to bear in mind what the learned Advocate-General pointed out, that the basis of the levy in the American cases referred to above was the inspection power, which was an exception to the operation of the commerce clause of the American Constitution. The power to levy a non-discriminatory tax was always recognised; and considerations on the basis of which a given levy was declared constitutional or unconstitutional by Courts in America may not apply to the same effect in considering the validity of a given levy as a fee under an enactment in this country.

70. As we pointed out the' question of reasonableness will really arise for full consideration only when we are called upon to decide the validity of the rule prescribing the actual levy under the authorisation conferred by Section 76(1). In deciding; whether Section 76(1) is intra vires the Legislature that enacted it, the primary consideration is the legislative competence. The question that would arise for consideration in deciding the validity of the prescribed rule would be whether it is intra vires the rule-making authority. The latter we have left out of account now. So it is really independent of the validity of the Rules that we have to consider whether what Section 76(1) authorises is the imposition of a fee.

71. At page 765 of May's Parliamentary Practice, 15th Edn. the learned author points out:. a ways and means resolution has been regarded as necessary in any case where the charge for a fee or licence has been unduly high or without a defined limit.

That may not quite apply with its inherent limitation of the reasonableness of the amount when the legislative power itself is only to levy a fee.

72. We have pointed out that the constitution of a separate fund, into which the contributions have to be paid, is not a decisive factor in deciding whether the imposition is a fee. It has certainly a strong probative value to infer that such was the intention of the Legislature. That, however, is not enough. The validity of the impugned legislative provision can be sustained, only if it is affirmatively established that what it imposes is only a fee.

73. We shall now consider whether the other tests which we have formulated earlier have been satisfied to establish that what Section 76(1) imposes is only a fee.

74. Entry 47 in List III of the VIIth Schedule of the Constitution certainly confers the power on the State Legislature for the imposition of a fee in respect of religious institutions, as they come within the scope of Entry 28 of List III. As Mr. Venkatasubramania Ayyar pointed out, the legislative power based on Entry 47 is a limited power, limited by the very nature of the fee to be in posed. It should be a fee bearing a just and reasonable proportion to the services rendered, for which the fee is exacted. So reasonableness is an inherent limitation on the legislative power conferred by Entry 47. There is nothing ex facie Section 76(1) to indicate that it is not a reasonable fee that was contemplated. The maximum of 5 per cent. did not really furnish any indication contra. Reasonableness of the actual levy as prescribed by the Rules is a different problem. If the fee is unreasonably high, that would be an invalid levy; but that would not affect the validity of the legislative sanction accorded by Section 76(1). The responsibility is really laid on the Government as the rule making authority to keep within the bounds of the limited power to levy the fee when prescribing the actual fee to be paid. If these bounds are exceeded, it should be needless to point out that Courts are under a duty to strike down the rule as invalid, despite the validity of the enactment, that is, Section 76(1). In Anson's Law and Custom of the Constitution, 5th Edition, Vol 1 at page 362, the learned author quoted the observations of Scrutton, L.J., in Attorney-General v. Wilts United Dairies 37 L.T.R. 884:.excessive claims by the executive Government without grant of Parliament arc at the present time quite as dangerous and require as careful consideration and restriction from Courts of justice.

That would apply with equal force to the present day conditions in this country also.

75. Prima facie Section 76(1) falls within the ambit of Entry 47. That test is satisfied.

76. The third, fourth and fifth of the tests we have mentioned above are also satisfied by Section 76(1). The services rendered by the Government through the Commissioner and his subordinates are incidental to the system of regulation embodied in the several provisions of the Act. That regulation was imposed by the Legislature solely on considerations of public necessity. As the Supreme Court pointed out in the Shirur Math's Case (1954) 1 M.L.J. 596 : (1954) S.C.J. 335, even as denominational institutions, maths are public institutions, in the sense, that a large section of the worshipping public are vitally interested in the proper maintenance and upkeep of these religious institutions. The statutory regulation imposed by the Act, minus the provisions which have been declared unconstitutional and unenforceable against Maths and Matadhipathis, has been upheld by the Courts as constitutional and valid.

77. Mr. Venkatasubramania Ayyar urged that, as many of the provisions of the Act have been declared invalid and unenforceable against Matadhipathis, the extent of permissible regulation of maths was much less than could be forced on other religious institutions. The extent of the service rendered to a given institution or even to a defined class of institutions like Maths cannot be the yardstick for assessing the reasonableness of the fee, the imposition of which is authorised by Section 76(1). No doubt, in the Rules framed by the Government, the validity of which we have not had to consider, the only classification for the levy of the graduated fee was on the basis of the income of the religious institution. No distinction was drawn between a Math and other classes of religious institutions. What other or further classification is permissible in framing valid rules, we are not called upon to discuss now.

78. Whether the quid pro quo test, the most vital basis to justify the imposition of a fee, has been satisfied by Section 76(1) is the next question. The co-relation between the fee for the levy of which Section 76(1) provides and the service to be rendered in return is specifically indicated in the clause as it now stands. 'It appears ex facie the (impugned) legislative provision.'

79. The co-relation exists in the purpose to serve which the Legislature levied the contribution. The further test, whether the impugned provision provides for the co-relation in the extent of the levy, cannot apply to Section 76(1) as it stands. That can apply only to the contribution 'prescribed' by the competent authority, the Government. Neither the specification of 5 per cent. as the maximum of levy nor the failure to specify the actual extent of the levy can invalidate Section 76(1) as a legislative provision for the imposition of the fee.

80. Mr. Venkatasubramania Ayyar next urged that the imposition of a flat rate of fee for all religious institutions, without any regard to the permissible extent of the service which can be rendered to Maths and Matadhipathis, would really violate Article 14 of the Constitution. He contended that under the guise of equal operation it would really amount to a denial of equal protection of laws, as the incidence of the levy on such a basis was bound to be unequal in the operation. That, he contended, would rob the impost of the reasonableness of the levy which is its necessary basis. Whether these considerations should apply to the rule prescribing the levy does not arise for discussion now. Neither expressly nor impliedly does Section 76(1) make it: obligatory to impose anything other than a flat rate. But it would appear to permit such a levy.

81. We have no hesitation in upholding the validity of Section 76(1), as it now stands amended. What it provides for is a fee within the scope of Entry 47, despite the simultaneous enactment of Sub-section (5) of Section 76.

82. Section 76(5) provides for the utilisation of the surplus in the fund built up of contributions levied under sub-sections (1) and (2). However laudable the object of the Legislature in providing for poor and needy religious institutions, and whatever be the extent of the good faith in which the Legislature enacted the provision, Section 76(5) was beyond the legislative competence granted by Entry 47 of List III. Obviously a contribution levied for the sole purpose specified in Sub-section (5) would not be a fee. There would be no quid pro quo basis at all for such an exaction. A levy to provide, even in part, for any purpose other than the strictly - relevant one, the service to be rendered by the State, would destroy the legal basis for the levy of a fee, which alone is authorised by Entry 47. The learned Advocate-General made no attempt to justify Section 76(5) as intra vires the Legislature. As he rightly pointed out, the scheme of the Act provided for either contingency, a deficit or surplus in the fund. The provision for the utilisation of the surplus for any purpose other than the payment for the service to be rendered, he conceded, was beyond the legislative competence of the Legislature. A levy, deliberately designed to provide for a surplus unreasonable in its quantum, would certainly be illegal. But then we should also realise that arithmetical precision, just balancing the income and expenditure in any given year, is impossible. As the learned Advocate-General pointed out, if there is a surplus in the fund, the benefit of that should go only to those who have to pay the prescribed fee. The rate of the fee could be reduced to maintain the just relation between the fee levied and the services rendered.

83. We regret the necessity; but the scope of Entry 47 compels us to negative the validity of Section 76(5). That legislative provision was ultra vires the State Legislature.

84. The validity of Sub-section (2) of Section 76 came in for a less violent attack than that on Section 76(1). The maximum Section 76(2) provides for is 1 1/2 per cent. towards the expenses of audit. The quantum of the actual levy is left to the determination of the Commissioner. What we have said at such length about Section 76(1) would also apply to Section 76(2), with this added factor in favour of the validity of Sub-section (2) that even the maximum specified by it cannot be challenged as unreasonably high. We hold that Section 76(2) is intra vires.

85. The validity of Sections 80 and 81, introduced by the Amending Act of 1954, should be obvious. In fact Section 81(1), which provides for the constitution of a fund, is one of the factors we have had to take into account in upholding the validity of sub-sections (1) and (2) of Section 76.

86. The validity of Section 82, which was also enacted by the Amending Act of 1954, was challenged even independently of the attack on Section 76(1). Section 82 gave retrospective effect to the amended provisions of sub-sections (1) and (2) of Section 76 and dated their operation back to the commencement of the Act in 1951.

87. It is true that Section 76(1) as amended in 1951 was declared by the Supreme Court in the Sirur Mutt Case (1954) 1 M.L.J. 596 : 1954 S.C.J. 335, as beyond the legislative competence of the State Legislature. Had Section 82(1) merely validated the levies in Section 76(1) as it originally stood, the petitioners would have had an unassailable basis for challenging the validity of the validating provision. The Legislature would still have lacked the legislative competence to validate either Section 76(1) as it was originally enacted or any levy under that invalid statutory provision. But this is not what Section 82(1) effected. The levy it authorises, no doubt, with retrospective effect, is under subsections (1) and (2) of Section 76 as amended in 1954. These statutory provisions, we have held, were within the competence of the State Legislature to enact. After a reference to the case-law on the subject we held in our unreported decision Soundararajan and Co. v. State of Madras Since reported in (1956) 1 M.L.J. 339 (T.R.C. No. 58 of 1955):

It is well settled that the power to validate illegal assessments made by executive authorities is incidental to the power to levy the tax provided, of course, the Legislature had the power to levy the tax.

That principle would apply with equal effect where the imposition is a fee. Where the legislative competence cannot be denied, the Legislature has undoubted power to give retrospective effect to such valid provisions. Though what was originally demanded under Section 76(1) as it was enacted in 1951, was an illegal tax, the demand is now deemed to be of a fee authorised by sub-sections (1) and (2) of Section 76 as amended in 1954. That would be a valid demand, though the demand is for a period antecedent to the date of the enactment of 1954.

88. Section 82(1) purported to validate not only contributions under Section 76(1) and (2), but it also purported to validate the actual levy at the rate prescribed even prior to the amendment of 1954. We pointed out that the rate ' prescribed ' by the Government under Section 76(1), as it stood before it was amended in 1954, was, 3 per cent. The validity of the rules framed after the amendment of Section 76(1) in 1954 do not arise for consideration. But consideration of the validity of the 3 per cent. levy in 1951 cannot be avoided, since that prescribed levy itself Section 82(1) purported to validate.

89. We have already pointed out that the data furnished even by the Government was not complete. The uncertainty regarding the validity of the provisions of Act XIX of 1951, which had to be tested with reference to the fundamental rights guaranteed and the prohibitions imposed by the Constitution made the demands and collection of contributions under Section 76(1) and (2) rather uncertain; and the Government was not to blame for failure to furnish sufficient data to decide whether the 3 per cent. levy could be upheld as a valid imposition of a ' fee ' judged by the tests we have mentioned earlier. All that we can say now is that it has not been established that the 3 per cent. that can be levied for the period between the date on which Act XIX of 1951 came into force and the amendment of 1954 is disproportionately large compared to the services rendered during that period, and the actual levy cannot, in the circumstances of the case, be declared ultra vires the rule making authority.

90. If on actual experience the Government find that the demand of the 3 per cent. levy during the period we have mentioned above does leave a substantial surplus, that should be a factor to be taken into account in fixing the quantum of the fee to be levied subsequent to that period. We should not be understood as saying anything in favour of the validity or the invalidity of a levy at 3 per cent. subsequent to the date on which the Amending Act of 1954 came into force. Since under Section 81 even contributions collected for the period between 1951 and 1954 have to be paid into the fund, there should be no difficulty in the Government adjusting the rates of levy for the period subsequent to the date of the Amending Act of 1954. It is on that basis that we decide in favour of the validity of Section 82(1) which validated with retrospective effect the ' prescribed ' rate of 3 per cent. We therefore uphold the validity of Section 82(1). If that stands, the validity of Sub-section (2) of Section 82 cannot be impugned. That is also valid.

91. Our conclusions are: Section 21, Section 30 Clause (2), and Section 31 of the impugned Act are invalid and unenforceable against the petitioners. Section 52(1)(f) and Section 55 are valid in the light of the interpretation we have placed upon those provisions. Rule 10 of the rules framed by the Government under Section 100(2)(y) of the Act is invalid. Section 76(5) is invalid: it was ultra vires the Legislature. Clause (1) and (2) of Section 76 and Sections 80, 81 and 82 are valid.

92. The rule nisi which was issued in each of these cases will be modified to the extent indicated above. To the modified extent the rule will be made absolute. Since neither side succeeded wholly in its contentions, we direct that each party its costs of these proceedings.


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