MODULE 4

PRESUMPTIONS
MEANING
Presumption means inferring something to be true.Therefore, presumption in
interpretation would mean that while construing a statute or any provision, the
courts must deem certain things to be true and correct.
In other words the courts must proceed to interpret with the conception of
correctness of certain things
Distinction between presumption and consideration

Presumption is a supposition or assumption with which the courts proceed to

interpret a statutory provision .Consideration is a thought which is required to be
given by the courts to the conclusion by it as to true legislative intent.

Thus, the courts start the process of interpretation with the presumptions and
end up with the consideration as to result thereof.

PRESUMPTIONS AS TO VALIDITY OF STATUTES

Every statute is considered to be valid.
Presumption as to constitutionality.
The court should not hastily infer that a law is ultra vires the Constitution.
While interpreting a statute or a provision thereof, the courts have to proceed
with the presumption that a particular law is intra vires and does not confront
the Constitution.
The court shall start with a mind-set that the impugned statute is valid and then
construe its provisions and if it still finds any of the provisions inconsistent with
the Constitution, the court may scratch the same.
But, it would be totally wrong if the court pre-determines that the impugned law
is bad and then proceed to interpret it.
If two interpretations are possible for a provision the court should lean in favour
of the interpretation that upholds the validity of the statute.
In C.S.T., M.P. v. Radhakrishnan (1979) 2 SCC 249, the Supreme Court held
that, in considering the validity of a statute, presumption is in favour of its
constitutionality and the burden to prove it ultra vires is on one who so claims.

State of Bihar v. Bihar Distillery Ltd. (1997) 2 SCC 453

 Supreme Court observed that the approach of the Court, while examining
the challenge to the constitutionality of an enactment is to start with the
presumption of constitutionality. The court should try to sustain its validity
to the extent possible. It should strike down the enactment only when it is
not possible to sustain it. It was also observed that, the Act, represents the
will of the people and that cannot be lightly interfered with.

Doctrine of pith and substance

Colourable legislation
Repugnancy between Central and State law.

PRESUMPTION AS TO TERRITORIAL OPERATION OF THE STATUTE

It is presumed that the legislation is territorial in its operation. It should be
presumed that the effect and operation of an enactment is restricted to those
subjects over whom the Legislature has authority and from whom the
Legislature can expect compliance. Any legislation is presumed to be limited to
those persons, property and events in the territory over which the Parliament
enacting the law has jurisdiction, unless otherwise is expressly provided in the
language of a statute or the same is inferred by necessary implication.
Thus, there is a general principle applicable to Income Tax Acts that either the
source from which the taxable income is derived should be within the territorial
limits of the country imposing the tax or the person whose income is to be taxed
should be resident there.

THEORY OF TERRITORIAL NEXUS

Constitution of India:
ARTICLE 245 (1) and (2)
General rule: the states cannot make laws barring their jurisdiction
Exception: Territorial nexus
State of Bombay v. R.M.D. Chamaurbaugwala AIR 1957 SC 699,
a company was incorporated in State of Mysore and conducted cross-words prize
competitions through agents and depots established in State of Bombay and by
circulating newspaper in that State although that newspaper was printed and
published outside the state of Bombay. The tax levied by State of Bombay was held to
be valid on the theory of territorial nexus.

PRESUMPTION THAT LEGISLATURE DOES NOT COMMIT MISTAKE

It is presumed that every word given by Legislature in the language of a statute
has been used mindfully, intentionally and suitably and the language employed
by legislature is proper and does not suffer from any mistake.
The consequence of this presumption is that the court cannot add, substitute or
reject the words or modify the language on the ground of likelihood of errors.
The court has to read the language as it is and give effect to it in its true sense.
The court cannot proceed on the assumption that the legislature does not know
what it says, or that it has made a mistake.
The courts cannot also presume that certain words which should have been
present in the language to avoid ambiguity are missing.
Reasons for defect in statutes:
Printing
Unskilfulness of the draftsmen
Passage through legislation.
PRESUMPTION THAT LEGISLATURE DOES NOT COMMIT MISTAKE
o Presumption that legislature does not use superflous words
o Presumption that the words used by
meaning

legislature bear ordinary

o Presumption that legislature has knowledge of english grammar

o Presumption that legislature does not intend any alteratio in existing
law except what it expressly declares
o Presumption that legislature does not intend what is inconvenient

PRESUMPTION THAT LEGISLATURE KNOWS

DECISIONS AND GENERAL PRINCIPLES OF LAW

LAW

AND

JUDICIAL

The court proceeds to construe a language with the assumption that the
Legislature was aware of existing statutes, the rules of statutory construction
and the judicial decisions.
Often legislatures repeal and re-enact laws. Where words of a repealed statute
are reproduced by the legislature in the re-enacted statute, such words should
be interpreted in the sense which has been assigned to them at the time of
interpreting the repealed Act. Thus if a provision interpreted by the Courts is
repealed by the legislature and is subsequently re-enacted using the same
words, it should be presumed that such reproduced words shall bear the same

meaning as was assigned to them by the Court at the time of interpreting the
repealed Act.
The reason behind this practice is that
the legislature is acquainted with the construction which the Courts have
put upon the words.
Had the legislature rejected the interpretation of the words as given by the
Courts, it would have either chosen different words, or would have given
some definition or explanation to change the meaning of the words.
STATUTES AFFECTING THE CROWN OR STATE
Common Law Rule
King can do no wrong was the maxim, which was in force in England during
the early days, and therefore, a statute was not applicable to a king in any case.
Further it has been said that the law is prima facie presumed to be made for
subjects only.

Later on this situation was diluted to some extent and in its place a presumption
came into being according to which the king made laws not for himself but for
his subjects and therefore, the king was not bound by the laws made by him
unless there was an explicit provision in the law that the king was bound by the
law, or at least there must be a necessary implication to that effect.
It is presumed that the Legislature does not intend to deprive the Crown of any
prerogative, right or property, unless it expresses its intention to do so in explicit
terms.
In Re Cuckfield Board the compulsory clauses of Acts of Parliament, which
authorize the taking of lands for railway or other purposes, such as are
contained in the Lands Clauses Act of 1845, was held not to apply to Crown
property, unless made so applicable in express terms or by necessary inference.
According to Lord Coke, three kinds of statutes bind the king without having
expressly provided that the statute binds the king.

Statutes for maintenance of religion, learning and the poor

Statute for suppression of wrong

Statute that tend to perform the will of a founder or donor

However, modern jurists like Craies or Maxwell do not accept the proposition
given by Lord Coke.
Even in England after the firm establishment of the democracy in 1947, the
Crown Proceedings Act makes the king liable in many cases even though the Act
may not specifically mention that the statute binds him.

Rule in India
In India in the early period, naturally the principles were drawn from the English
law, and in Robert vs. Ehern it was held that the position in England was to be
extended to the colonies also.
The first case decided on this matter by the Privy Council was Province of
Bombay vs. Municipal Corporation of Bombay. The case was whether the
government was bound by the Municipalities Act. The court answered in the
negative.
After independence, a similar case came before the Supreme Court in Director
of Rationing and Distribution vs. Calcutta Corporation. The court held
that the government was not bound by a statute unless the statute provides
that it is binding the government expressly by necessary implication. This
decision was given by a bench of seven judges in which six judges formed the
majority. Justice Subha Rao gave his dissenting opinion.
Shortly after that Justice Subba Rao became the Chief Justice of India and a
similar case came before the Supreme Court in Superintendent and Legal
Remembrancer to State of West Bengal vs. Corporation of Calcutta.
Justice Subba Rao constituted a bench of 11 judges to reconsider the decision in
Director of Rationing and Distribution vs Corporation of Calcutta, and he
held that the common law theory of King can do no wrong was not appropriate
in a democratic country. Even in England, this theory has been given up after
the Crown Proceeding Act, 1947.
Hence the court held that government is bound by a statute unless it is
expressly or by necessary implication been provided that the government is NOT
bound by the statutes. It was pointed out that however high you may be the
law is above you.
In Union of India v. Jubbi the statute provided that the tenants may become
owners by paying compensation to the landlord in the manner provided in the
Act. Jubbi who was a tenant, under the government offered to pay the
compensation to become the owner. But the government rejected this offer on
the ground that the statute is not applicable to government lands. But the
Supreme Court rejected this contention holding that there is no expressed or
implied provision to exclude the government from its operation.

CONSTRUCTION MOST AGREEABLE TO JUSTICE AND REASON

Absurdity

Unreasonableness

Injustice

Hardship

Inconvenience

Anomaly

In determining either what was the general object of the legislature, or the meaning of
its language in any particular passage, it is obvious that the intention which appears
to be most agreeable to convenience, reason, and justice, should, in all cases open to
doubt, be presumed to be the true one.
Whenever the language admits of two constructions, according to one of which the
enactment would be unjust, absurd, or mischievous, and according to the other it
would be reasonable and wholesome, it is obvious that the latter must be adopted as
that which the Legislature intended.
When the language is explicit, its consequences are irrelevant and if the language is
plain and unambiguous, the courts have to give effect ti it regardless of consequences
thereof.
Any plea of injustice, hardship, inconvenience or anomaly shall not be admissible. The
Court cannot legislate under the garb of interpretation.
In Omprakash v. Radhacharan (2009) 15 SCC 66,
it was held that only because a case appears to be hard would not lead
invocation of different interpretation of a statutory provision which
otherwise impermissible. It was further held that the sentiment
sympathy alone would not be a guiding factor in determining the rights
the parties which are otherwise clear and unambiguous.

MODULE
5
:
JURISDICTION

AFFECTING

COURTS

It is not permissible to interpret any statutory instrument as to exclude the natural

justice, unless the language of the instrument leaves no option for the Court.

Liberty Oil Mills v. Union of India (1984) 3 SCC 465

Neither a Tribunal by its order or a party by its consent can confer jurisdiction on
Civil Courts.

Gaekwar Sarkar of Baroda v. Gandhi Kachra Bai (1903) ILR 27 Bom 344 (PC)

STATUTES

to
is
or
of

jurisdiction means the power of an authority to take decision on a matter.

In case of courts it means power of the court to try and decide a case.

In A. R. Antulay vs. R. S. Nayak it was held that creation of jurisdiction is legislative

function and cannot be discharged by even the judiciary. Any court, subordinate or
superior including the Supreme Court, cannot create or enlarge the jurisdiction of a
court. Only legislature is competent to do so.

For example, Section 9 of CPC provides that Civil Courts shall take cognizance of suits of
civil nature, unless barred.

Thus, though Civil Courts have jurisdiction to take cognizance of suits of civil nature,
they cannot take cognizance of all suits of civil nature.

If any enactment bars the jurisdiction of a civil court in respect of any subject matter,
civil courts cannot take cognizance of cases substantially involving such matters

There are two limitations over the powers of the legislatures to bar the jurisdiction of
courts by making statutory provisions.

Jurisdiction created by Constitution cannot be barred or restricted by a statutory

provision.

An alternative forum must be created in to take cognizance of the matters in

respect of which the jurisdiction of courts is barred.

Jurisdiction which is created by the Constitution may be barred or restricted by making an

amendment to the Constitution only.

Barring the jurisdiction of courts without creating an alternative forum will take away
the judicial review which is a component of the basic structure of the Constitution.

Therefore, creation of an alternative forum is essential. Some remedy and a forum to

enforce that remedy is necessary under the maxim ubi jus ibi remedium.

If no alternative forum is created by a law barring the jurisdiction of courts, the parties
affected may invoke the writ jurisdiction of High Courts. If there is a violation of
fundamental rights, even the writ jurisdiction of the Supreme Court may be invoked.

The basic presumption of law is that all civil courts are empowered to decide all suits of
civil nature.

The basis of this presumption is that civil and criminal court have general jurisdiction
over people and they have right to have free access to both civil and criminal court

United Provinces v. Atiqa Begum AIR 1941 FC 16.

where the statute creates a liability not existing at common law and gives also a
particular remedy for enforcing it with respect to that class; it has always been
held that, the party must adopt the form of remedy given by the statute.

Under the Karnataka Land Reforms Act, 1962, the Tribunal constituted for the purpose
decided as to who was the tenant in possession prior to the date of resting, and entitled to be
registered as tenant with the State Government. The decision of the Tribunal was thus made
final and the civil courts jurisdiction was impliedly excluded.

Mudakappa v. Rudrappa (1994) 2 SCC 57.

FINALITY CLAUSE

A Finality Clause is a provision in an Act of Parliament to restrict or eliminate Judicial

Review.

Parliament uses this clause to bring finality to decisions that they wish to be determined
in the way they have laid down without delays or without an interpretation that does
not meet the political expectations of the executive.

Some examples:

In Abdul v. Bhavani AIR 1966 SC 1718; it was observed that statutes which exclude civil
courts jurisdiction must be strictly construed.

Thus in Motor vehicles Act, 1988, jurisdiction of the court is excluded.

Industrial Disputes Act, 1947, Courts jurisdiction is excluded.

It is sometimes provided by a particular statute that a decision taken under it

The remedy by certiorari is never to be taken away by any statute.

The word final means without an appeal. It does not mean without recourse to the writ
of certiorari.

It makes the decision final on fact but not on law.

In Dhulabhai v State of MP, the Supreme court held that if a statute gives finality to the
orders of a special tribunal, the jurisdiction of civil court must be held to excluded only
if there is an adequate alternate remedy similar to what civil remedy would be.

Therefore, the courts interpret the Finality clause very narrowly.

And that judicial review is not an appeal.

In R v. Medical Appeal Tribunal (ex parte Gilmore) [1957] the tribunals decision was
quashed for error of law even though the statute in question said that the tribunals
decision shall be final. Denning LJ said:

I find it very well settled that the remedy by certiorari is never to be taken away by any
statute except by the most clear and explicit words.

The reason for the restrictive approach towards any attempt to exclude judicial
remedies is the fear of the ordinary courts of law that public authorities and tribunals
might otherwise acquire arbitrary and uncontrollable power.

The courts seek to prevent this by means of a presumption that Parliament always
intends statutory powers to be exercised lawfully.

EXCLUSION: EXTENT OF

If there is no provision in a statute to enable a tribunal or other authority to hold an

inquiry, the same indicates that the Civil Courts jurisdiction is not excluded.

The Tribunals, when jurisdiction is transferred to them, can make use of the principles of
procedure contained in CPC unless such principles are inconsistent with the provisions
of the Act consisting them.

The courts have however powers to decide whether the tribunal has acted in excess of
its statutory powers.

Neither a tribunal by its order nor a party by its consent can confer jurisdiction on civil
courts.

Kachra Bai Case:

Section 10 of the Railways Act 1890.

a suit shall not lie to recover compensation, but in case of dispute the amount
thereof, shall on an application to the collector be determined and paid in
accordance with the provisions of the Land Acquisition Act, 1894.

The proposition in this case explains a principle that when an act authorized by
law is being done by a public body, for public benefit, in a proper and lawful
manner and still however such an act works an injury to particular person, the
person cannot file a suit for compensation; he is without a remedy.

However, if the remedy is given by the statute he can have it.

In this case the power is exercised arbitrarily and carelessly resulting in exceeding the
authority given. It is therefore an abuse of authority and no protection of law is
available to the undertakers.

If a tribunals order is violative of the provisions of the Act, or if it abuses its powers and
does not act under the Act, it can be questioned in a court of law.

Radha Krishnan v. Ludhiana Municipality, AIR 1963 SC 1547

If there is a non-compliance with the fundamental provisions of the Act or
fundamental principles of judicial procedure, it makes the proceedings before an
authority or tribunal illegal and void. Consequently a civil suit challenging the
order made or the decision given in such proceedings is not barred.

In Parmeshwari Devis case, by an order under Section 132(5) on search of assessees

premises certain ornaments were recovered and seized. They were retained by the tax
authorities. Section 132(11) provided a remedy for challenging the order of seizure.
Assessees stepmother instead of applying under Section 132(11) brought a suit in the
civil court for partition of the ornaments. This amounted to challenging the order and
proceedings. It was held that the suit was barred under Section 293 of the Act.

MODULE 6 : REPEAL OF STATUTES

Meaning

Repeal means to revoke, abrogate or cancel, particularly a statute.

Repeal maybe expressed or implied by enacting a matter contrary to and inconsistent

with the prior legislation.

Under general clauses act Section 6, Repeal is defined as; abrogation/obliteration of

one statute by another.

The end effect of Repeal is as though the first statute had never been passed.

Modification is NOT Repeal.

Repeal may be Expressed or Implied.

Kinds of Statutes

Perpetual

No time period is fixed for its duration.

Remains in force until Repealed.

Called perpetual as it is not abrogated by time or by non use of it.

Temporary
They come to an end on the expiry of a specified time.
Cannot be amended post expiry.
Can be revived only through re-enactment.

Temporary Statutes
o

Effect of Repeal

Section 6, general clauses act:

(a) Revive anything not in force or existing at the time at which the Repeal takes effect.
(b) Affect the previous operation of any enactment so Repealed or anything duly done or
suffered thereunder.
(c) Affect any right, privilege, obligation or liability acquired, accrued or incurred under any
enactment so Repealed.
(d) Affect any penalty, forfeiture or punishment incurred in respect of any offence
committed against any enactment so repealed.
(e) Affect any investigation, legal proceedings or remedy in respect of any such right,
privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid; and any
such investigation, legal proceeding or remedy maybe instituted, or continued or
enforced and any such penalty, forfeiture or punishment may be imposed as if the
Repealing act or regulation had not been passed.

Repealed provisions are treated as if they never existed They apply only to pass
transaction.

In the case :
Kolhapur cane sugar works ltd V. UOI It was held
by the court that proceedings shall be discontinued upon Repeal of a statute unless:
(a) Covered under sec 6 of general clauses act
(b) Savings provision

Effect on Offences

After expiration no person can be prosecuted under the act.

If prosecution has not ended before expiry, the proceedings end.

If offenses are punishable under ordinary laws, but were being tried by special courts
where such courts were such statutes trial will continue in ordinary courts.

Notifications/ Appointments/ Rules/ Orders.

Statute not dead for all purposes.

Repeal by a Temporary Statute

(a) Whether the previous statute which has been Repealed will revive is subject to
the construction of the temporary statute

State of Orissa V. Bhupendra Kumar

Types of Repeal
Legislature has the power to Repeal the law. Only a legislature that has the power to enact a
law can Repeal such law.

Express:
By express provison
No special form of words are necessary
Examples

Implied:

(a) By necessary implication

(b) Not preferred by courts
(c) May be inferred by
Where there is a direct conflict between two provisions
When the legislature intended to lay down an exhaustive code in respect of the
subject matter replacing the earlier law
When the two laws occupy the same field, but in absence of conflict between
general law and special law Repeal cannot be implied

Doctrine of Implied Appeal

Basis
It is presumed that the legislature knows the existing state of law and that it did
not intend to create any confusion by retaining any conflicting provisions

 The courts in applying this doctrine are merely supposed to give effect to
legislative intent by examining the object and scope of the two enactments
Case:

Ratanlal Adukia V. Union of India

In the above case sec 80 as substituted by sec 14 of Railways (amendment) Act,
1961 were under consideration which related to place of suing i.e., territorial
jurisdiction of courts.
Held that; sec 80 is a complete, self contained, exhaustive code with regard to
place of suing, constituting a special law for such suites.
Legislative intent is that plaintiff must institute suits only in courts mentioned in
sec 80 of Railways Act for claims of compensation against the Railways.

To Summarise in the above case, it was held that where subsequent special legislation on
the same subject is a self contained compete code in itself, legislative intent is deemed to be,
to exclude the earlier general laws on the subject.

Presumption Against Repeal

Courts can lean against implied Repeal.

If by any fair interpretation both statutes can stand together, there shall be no implied
Repeal if possible, implied Repeal shall be avoided.

The scope for application of this Doctrine arises only when the latter Statute provides
for a different punishment or procedure for an offense in comparison to the previous
Statute.

CASE LAW:
Dr. Tariq Mehmood Mian V. Govt of Punjab
Question : whether the allopathic system (prevention of misuse) ordinance, 1962 and rules
framed under it have been impliedly Repealed by the Punjab health care commission Act,
2010
Held : The contention is ill-founded on

Misunderstanding of the Doctrine of Implied Repeal

Wrong understanding of Punjab Health Care Act

Obiter Dicta
In this case the courts explained and expanded the concept of Implied Repeal
Courts do not favour Implied Repeal

 The presumption is always against the intention of the legislature to

Repeal by Implication
The presumption arises due to the presence, generally, of an express
statement to repeal
Reason
An express statement exists, which shows not only legislative intent, but the knowledge of the
legislature on laws that already exist pertaining to the same subject matter
In the case, it is clear that the Punjab Health Care Act did not have any express provision
pertaining to Repeal, hence the presumption against Repeal by implication survives
The Principle
The Principle laid down in the above case is used only where the new law is inconsistent with,
or repugnant to an existing law which than can be Repealed
Abdul Samad V. Ahmed Khan Lodhi
The court held:
Only where two Acts are inconsistent with each other, the latter Act will be said
to impliedly Repeal the former
Court must be satisfied that both Acts cannot be harmoniously constructed
Reiterated in Mumtaz Ali Khan Rajban and anr V. Federation of Pakistan and Ors
Ratio
Implied Repeal is possible only if the statutes provisions are plainly repugnant to a
subsequent statute
Contention of a petitioner is misconceived
The petitioners main contention was that, under the Punjab health care Act, a person not
registered or licenced is a quack and there is no such provision under the Allopathy Act. The
former Act is Repealed by the latter Act
The new Act introduces a new criteria
the Punjab Health Care Act only adds an extra criteria for medical practitioners to fulfil, it is
not repugnant to the Allopathy Act, and hence cannot be assumed to be Repealed by
Implication
Different subject matter
both Acts do not deal with the same subject matter. The Allopathy Act deals with persons
other than medical practioners to prescribe antibiotics and other dangerous drugs. The PHC
Act deals with health care services in general. It is not limited to non-medical practioners
prescribing drugs. Hence PHC Act is a general, broad law dealing with Health care, whereas
Allopathy Act is a special Law.
Conclusion
Jamshed Ali V. State

In this case, the court laid down that where inconsistency exists, the latter special Law
Repeals, by implication, the former general law.
Hence in the case of Dr. Tariq Mehmood Mian, the court held that the petitioner's contention
was ill-founded and the latter statute, could not Repeal by implication, the former existing law

MODULES 7, 8 & 9 : SUBSTANTIVE AND

ADJECTIVE LAW, RETROSPECTIVE OPERATION
(Penal + Taxing statutes) AND RES JUDICATA.
INTRODUCTION
Laws are classified as substantive laws and procedural laws. Procedural laws are also
called adjective laws.
Substantive laws are those laws which provide for the rights, duties and liabilities of the
persons governed by the concerned law.
Substantive law which lays down the liabilities of the persons violating the law does not
mention how to enforce the liability so incurred. This is the realm of the procedural laws

In case of the Indian Penal Code and other criminal laws the Criminal Procedure Code,
1973 prescribes the procedure for enforcing the criminal liability, while in case of Law of
Torts, Law of Contracts and other civil laws, the Civil Procedure Code, 1908 provides for
the procedure for enforcing the liability.

Procedural laws prescribe the broad procedure for enforcing the liabilities. They do not
deal with their implementation as such, i.e., the steps to be taken to follow this
procedure.
This aspect of the procedure is done by the Rules of Practice framed by the High Courts
for the subordinate courts.
Ex: Karnataka Civil Rules of Practice, 1967 and Karnataka Criminal Rules of Practice
framed by the Karnataka High Court take care of the rules of practice in civil and
criminal cases respectively.

INTERDEPENDENCE
Substantive laws and procedural laws are interdependent. Without substantive laws
there cannot be procedural laws.
If there are no rights and liabilities to be enforced, there is no need for the procedure.
On the other hand, if there are no procedural laws, substantive laws become useless.
If the rights and liabilities cannot be enforced, their existence becomes meaningless.
The well known legal maxim ubi jus ibi remedium stresses upon the importance of
procedural laws

 Further, the efficacy of the substantive laws greatly depends upon the quality of
procedural laws. If the procedure is simple, expeditious and inexpensive, the
implementation of substantive laws becomes effective and successful. Otherwise,
however good and strong the substantive laws may be, they remain ineffective.

SUBSTANTIVE LAWS VS. PROCEDURAL LAWS

As observed by Lord Halsbury, there is at the outset a vital and essential distinction
between substantive and procedural law. The function of substantive law is to define,
create or confer substantive legal rights or legal status or to impose and define the
nature and extent of legal duties. The function of procedural law is to provide the
machinery or the manner in which the legal rights or the status and legal duties may be
enforced or recognized by a court of law or other recognized or properly constituted
tribunal.
SUBSTANTIVE LAWS :Substantive law enables the parties to approach the court for
redressal of their grievances
PROCEDURAL LAWS :It enables the court to redress the grievances of the parties in a
just and fair manner.
Guarantees impartiality, fairness and justice in a case.
It makes the proceedings of the court definite and hence predictable.

Decision of a court on the basis of substantive law involves the decision of rights and
liabilities of the parties. Thus if the court finds that the defendant is not liable, and
hence dismisses the case, the court has given its decision on the basis of the
substantive law. Such a decision is called a decision on the merits of the case.
Decision of a court on the basis of the procedural law involves the decision regarding
the way the case was conducted. If the suit is dismissed by the court on the ground that
it was barred by limitation, the courts decision is based on procedural law. The court
does not decide that the plaintiff is not entitled to the relief sought by him or that the
defendant is not liable in that case. Such a decision is called a decision on
technicalities.
A decision on merits of the case bars a future case between the same parties on the
same facts and grounds, a decision on technicalities does not.
The differences between substantive laws and procedural laws
Substantive law determines the conduct and relations of the parties inter se in respect
of the matter litigated whereas the procedural law regulates the conduct and relations
of courts and litigants in respect of the litigation.
Substantive law deals with the ends which the administration of justice contemplates
while the procedural law deals with the means and instruments by which the ends of
administration of justice are to be attained.
The question as to what facts constitute a wrong is determined by the substantive law,
while what facts constitute proof of a wrong is a question of procedure.

 Substantive law defines the rights whereas the law of procedure defines the modes and
conditions of the application of one to the other.
Substantive law relates to the matter outside the courts. Whereas the procedural law
regulates affairs inside the courts.

IN OTHER WORDS:
Differences:

Substantive law

Relates to purposes and subject-matter of litigation.

Concerns with the end to litigation.

It deals with the question - what facts constitutes a wrong.

Litigation in theory.

It relates with what law achieves ends, rights.

It relates to the matter outside the Courts.

Procedural law

It governs the process of litigation.

Means and instruments by which those ends(justice) are to be attained.

It deals with the question - what facts constitutes proof of a wrong.

Litigation in practice.

How law achieves those ends, rights(justice).

It regulates the procedure followed by the Courts while deciding any case.

There are differences between procedural and substantive laws, but not strict. The
distinction between the two is not easy, the same law may be procedural as well as
substantive.

Exa. Right to appeal.

Right to speedy trial.

RES JUDICATA

A legal doctrine that generally means that once a matter is judicially decided, it is
finally decided. The doctrine bars re-litigation of matters that have already been
determined in adjudication.

Specifically, res judicata precludes only subsequent suits on the same cause of action
between the same parties after a final judgment on the merits.

Res Judicata as a concept is applicable both in case of Civil as well as Criminal legal
system.

Objects:

To uphold the rule of conclusiveness of judgment

To bring the litigation to an end

To avoid contradictory findings in the same suit

To prevent injustice to the parties

To avoid unnecessary waste of resources and time of the Judicial System

The doctrine of Res Judicata is based on three maxims:

(1) Nemo debet lis vaxari pro eadem causa (no man should be vexed twice for the
same cause);

(2) Interest republicae ut sit finis litium (it is in the interest of the state that there
should be an end to a litigation); and

(3) Re judicata pro veritate occipitur (a judicial decision must be accepted as correct).

Section 11 of Civil Procedure Code States:

No court shall try any suit or issue in which the matter directly and substantially in
issue has been directly and substantially in issue in a former suit between the same
parties, or between parties under whom they or any of them claim, litigating under the
same title, in court competent to try such subsequent suit or the suit in which such
issue has been subsequently raised, and has been heard and finally decided by such
court.

Essentials to Res Judicata:

1. There must be two suits, one previously instituted and the other subsequently
instituted.
2. Such parties must be litigating under the same title in both the suits.
3.

The matter in issue in the subsequent suit must be directly in the issue in the previous
suit. (same subject-matter)

4. Both the suits must be between the same parties or their representatives.
5. The court in which the previous suit is instituted must have jurisdiction to grant the
relief claimed in the subsequent suit.

6.

There must be a final judgment.

7. The judgment must be on the merits.

Historical Development of Res Judicata:

Res Judicata finds its evolvement from the English Common Law system, being
derived from the overriding concept of judicial economy, consistency, and finality. From
the common law, it got included in the Code of Civil Procedure.

From the Civil Procedure Code, the Administrative Law witnesses its applicability.
Then, steadily the other acts and statutes also started to admit the concept of Res
Judicata within its ambit.

which was later as a whole was adopted by the Indian legal system.

Scope of Res Judicata:

Doctrine of Res Judicata is a fundamental concept based on public policy and private
interest.

It applies to civil suits, execution proceedings, arbitration proceedings, taxation

matters, writ petitions, administrative orders, interim orders, criminal proceedings, etc.
Rural Litigation and Entitlement Kendra v. State of Uttar Pradesh (1985)

Controversy: whether for social safety and for creating a hazardless environment for the
people to live in, mining in the area must be permitted or stopped.

The writ petitions filed in the Supreme Court are not inter-party disputes and have
been raised by way of public interest litigation.

Even if it is said that there was a final order, in a dispute of this type it would be difficult
to entertain the plea of Res Judicata.

The principle of Res Judicata does not apply strictly to public interest
litigations.

Consequently, to avoid unnecessary multiplicity of proceedings and in the interests of

the society , the Environment (Protection) Act, 1986 was enated.

Under this enactment, power became vested in the Central Government to take
measures to protect and improve the environment.

The bar of res judicata would not apply to a writ of habeas corpus where the petitioner
prays for setting him at liberty.

(T.P. Moideen Koya v. State of Kerela 2004)

Exceptions to Res Judicata:

Collateral order doctrine: based on procedural or jurisdictional issues, based not on

the wisdom of the earlier court's decision but its authority or on the competence of the
earlier court to issue that decision.

Principle of res judicata is not applicable in case of decisions relating to jurisdictional

facts. -Sonepat coop., sugar mills ltd v. Ajit Singh (2005)3 SCC 232

Order passed without jurisdiction is a nullity thus held, cannot operate as res
judicata, even if such order attains finality in favour of some other parties by virtue of
not being appealed against.

Union of India v. Assn. of Unified Telecom Service providers of India, (2011) 10 SCC 543

In addition, in cases involving due process, cases that appear to be Res Judicata may
be re-litigated.

An instance would be the establishment of a right to counsel. People who have had
their liberty taken away (that is, imprisoned) may be allowed to be re-tried with a
counsellor as a matter of fairness.

Criticisms:

Res Judicata does not restrict the appeals process, which is considered a linear
extension of the same lawsuit as the suit travels up (and back down) the appellate
court ladder. Once the appeals process is exhausted or waived, Res Judicata will apply
even to a judgment that is contrary to law.

There are limited exceptions to Res Judicata that allow a party to attack the validity of
the original judgment, even outside of appeals.

In addition, in matters involving due process, cases that appear to be Res Judicata
may be re-litigated. An example would be the establishment of a right to counsel.
People who have had liberty taken away (i.e., imprisoned) may be allowed to be re-tried
with a counsellor as a matter of fairness.

RETROSPECTIVE OPERATION OF STATUTES

Nova Constitutio futuris forman imponere debet, non praeteritis every new enactment
should affect the future and not the past.
The presumption is against retrospective effect being given to a statute.
Where two interpretations are possible, the court should avoid a construction which
produces retrospective effect.
When an enactment should prejudicially affect vested rights, the rule against
retrospective operation applies.
Where retrospective effect is to be given no larger retrospective effect shall be given to
a statute than the language warrants.
A statute may be declared expressly retrospective or a retrospective effect may be
implied by the court.
A fiscal statute cannot be regarded as retrospective by interpretation. It should only be
so regarded expressly

Declaratory Acts, that is Acts for the removal of doubts, curative and validating Acts
and remedial statutes are generally retrospective. A remedial statute is one which is
not criminal or penal and which deals with remedies and procedure and does not affect
any substantive right.
There is no presumption of retrospective effect when the statute deals with procedure.
The rule that no Act is meant to operate retrospectively is strengthened when the Act
imposes a penalty.
Strictly speaking a retrospective law only looks backward on things that are past and it
is retroactive law that acts on things that are past. But the terms retrospective and
retroactive are used synonymously.

MEANING
Retrospective means

looking backward;

Contemplating what is past,

Having reference to a state or things existing before the Act in question.

Retrospective law means a law which looks backwards or contemplates the past; one which
is made to affect acts or facts occurring, or rights occurring, before it came into force.

GENERAL PRINCIPLES
A. Power to make Retrospective Laws
By Central or State Legislature, so long as the subject is within their own fields and is
not restricted by Constitution.
Can be done only for the purpose of curing the existing defects or giving an invalid
legislation validity.
B. Statutes dealing with substantive rights
Declaratory enactment: Also called a Clarificatory Enactment and generally operates
retrospectively.
Degree of Retrospectivity: Degree to be spelt out from language of the concerned
provisions
Every statute is prospective:
i.

Delhi Cloth & General Mills v. CIT : Every statute is primafacie prospective unless
provided otherwise

ii.

Based on maxim nova constitution futuris formam imponere debet, non praeteritis a
new law ought to regulate what is to follow, not the past.
Statute taking away vested right retrospectively: Such statute is considered to
be unjust, unless it expressly provides for such retrospectivity.

Statutory fiction: such fiction cannot be extended beyond the purpose for which it
was created. E.g., Company (a separate legal entity under Companies Act ) cannot be
covered by the Citizenship Act, hence no right to vote etc.

Presumption against retrospectivity:

Mithilesh Kumari Case: When the remedy provided by the new Act for a right envisaged
in the old Act becomes unenforceable, then the remedy under the new Act will automatically
have retrospective application.
C. Statutes dealing with procedure
Blyth v. Blyth: No retrospectivity for statutes which affect vested rights. Every other
procedural statute where an alteration happens only to the form of procedure or admissibility
of evidence can be given retrospective effect.
D. Rule against retrospectivity
Dena Bank v. Parekh & Co.: Retrospectivity to be expressly provided for, for it to be
given effect.
E. Importance of Language used
Court to construe in such a manner so as to give effect to intention of Legislature which
is gathered from:
a. Language used
b. Object of statute
c. Nature of affected rights
d. Circumstances in which statute is passed
E.g., In Daniel Latifi v. Union of India the Court observed as follows: the contention
that the expression within in s.3(1)(a) of the Muslim Women (Protection of Rights on
Divorce) Act, should be read as during or for cannot be accepted because words
cannot be construed contrary to their meaning as within would mean on or before
and not beyond. Therefore, is was held that the Act would mean that on or before the
expiration of the iddat period, the husband is bound to make and pay maintenance to
the wife.

RETROSPECTIVE OPERATION OF STATUTES

(i)

PENAL STATUES
When Legislature enacts a statute that provides for penalties in case of violation of the
statute it is termed as a Penal Statute
If the statute enforces obedience to the command of the law by punishing the offender
and not by merely redressing an individual who may have suffered, it will be classified
as penal

DISTINCTION BETWEEN REMEDIAL AND PENAL STATUTES

With respect to a remedial statute the interpretation may be liberal whereas in case of a
penal statute the interpretation is very strict
In case of a remedial statute the interpretation is in favour of the class of persons for
whose benefit the statute is enacted; whereas in case of penal statutes the
interpretation is in favour of the alleged offender

STRICT CONSTRUCTION OF PENAL STATUTES

Iqbal Singh Marwah vs. Meenakshi Marwah
AIR 2005 SC 2119
A statute enacting an offence or imposing a penalty is strictly construed

R vs. Cuthbertson
1980 2 All ER 401
The fact that an enactment is a penal provision is in itself a reason for hesitating before
ascribing to phrases used in it a meaning broader than that they would ordinarily bear

Niranjan Singh Karan Singh Punjabi vs. Jitendra Bhimraj Bijja AIR 1990 SC 1962
There is all the more reason to construe strictly a drastic penal statute which deals with
crimes of aggravated nature which could not be effectively controlled under the
ordinary criminal law
L.K. Hashim vs. State of Tamil Nadu 2005 1 SCC 237
The application of the rule does not permit the court in restraining comprehensive
language used by the Legislature, the wide meaning of which is in accord with the
object of the statute
However, the rule of strict construction does not prevent the court in interpreting a
statute according to its current meaning and applying the language to cover
developments in science and technology not known at the time of passing the statute
Balaram Kumawat vs. Union of India 2003 7 SCC 628
Penal statutes have also to be interpreted having regard to the subject-matter of the
offence and the object of the law it seeks to achieve
The purpose of law is not to allow the offender to sneak out of the meshes of law
Criminal jurisprudence does not say so
PURPOSIVE APPROACH

It is not necessary that courts must always favour the interpretation which is favourable
to the accused and not the prosecution but it may also chose to go for the
interpretation which is consistent with the object provided in the law

R vs. Pawlicki, 1993 3 All ER 902

Section 18 (1) of the Fire-arm Act, 1968 provides: It is an offence for a person to have
with him a fire-arm with intent to commit an indictable offence
The appellants were arrested in a premises where they had allegedly gone to commit
robbery
They had parked their car at a distance of 50 yards from the premises
The car was found to contain three sawn off shot guns and other items consistent with a
planned robbery
The appellants were convicted under s.18 (1) for having with them fire-arms with intent
to commit robbery

The contention of the appellants was that considering the distance at which the car was
parked the fire-arms were not immediately available to the appellants when they were
arrested and it could not be said that they had with them the fire-arms lying in the car
Rejecting this contention the Court of Appeal applied a purposive approach and held
that the emphasis must not be so much on the exact distance between the criminals
and their guns but rather on the accessibility of those guns judged in the common
sense way and it was sufficient that the guns were readily accessible to them at a time
when they were about to commit robbery
Section 17 (2) of the same Act provides that if a person at the time of his committing an
offence specified in schedule 1, has in his possession a fire-arm or imitation fire-arm
he shall be guilty of an offence under that section
R. vs. Bentham, 2004 2 All ER 549 CA
Construing these provisions of the Act with their object to protect victims presented
with what they reasonably believed to be a fire-arm, it was held by the Court of Appeal
that fingers placed inside a jacket with the appearance of a fire-arm could constitute an
imitation fire-arm within Section 17 (2)
The House of Lords reversed this decision on the ground that one cannot possess
something which is not separate and distinct from one self and that Parliament has not
created an offence of falsely pretending to have a fire-arm

METHODS OF INTERPRETATION OF PENAL STATUTE

The basic rule of interpreting such laws is to strictly adhere to the language of the
statute since it is the will of the legislature and the court should restrain itself from
stretching the meaning of the words causing unnecessary hardships to the subjects
It must be always kept in mind that what is the purpose for which the enactment seeks
to achieve and if a strict adherence is done will it be able to achieve that purpose or
object
Whether by such an interpretation the mischief which was sought to be suppressed by
the penal law was suppressed and if not then it is the duty of the court to ensure that it
is done and just because of the Legislatures omission, the injustice to the society
should not be administered

(ii) FISCAL (TAXING) STATUTES

INTRODUCTION

Article 265 of the Constitution provides: No tax shall be levied or collected except by
authority of law

Article 366(28) of the Constitution which defines Taxation and Tax reads: Taxation
includes the imposition of any tax or impost whether general or local or special and
tax shall be construed accordingly

A tax is imposed for public purpose for raising general revenue of the State.

A fee in contrast is imposed for rendering services and bears a broad Co-relationship
with the services rendered.

A scrutiny of Lists I and II would show that there is no overlapping anywhere in the
taxing power and the Constitution gives independent sources of taxation to the Union
and the States. The taxing entries have to be construed with clarity and precision so as
to maintain this exclusivity.

In terms of Article 265 all acts relating to the imposition of tax providing, inter alia, for
the point at which the tax is to be collected, the rate of tax as also the recovery must
be carried out in accordance with law

Framework:
1) Direct taxes
Income tax (based on various heads of income)
Wealth tax ( 1% of the amount by which net wealth exceeds 30 lakh)
2) Indirect taxes
VAT
Service tax

CARDINAL PRINCIPLE OF INTERPRETATION

Cape Brandy Syndicate v. IRC [1921] 1 KB 64
CIT v. Ajax Products Ltd. [1965] 55 ITR, 741 in which it was held as follows :
In a taxing statute one has to look merely at what is clearly said. There is no room for any
intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is
to be read in, nothing to be implied. One can only look at the language used."
LITERAL INTERPRETATION
The rule of literal construction is widely accepted rule for interpreting the taxing statutes. If
the language of the statute is clear and unambiguous, we have to accept the plain
meaning even if it leads to some harshness or injustice to the assessee. As long as there is
no ambiguity in the statutory language, the rule of literal interpretation has to be applied.
A dealer or assessee cannot be subjected to tax without clear and unambiguous words for
the purpose of levying the tax which is authorised by law, enacted by the Parliament or by
the State Legislature.
Smt. Tarulata Shyam v. CIT [1971] 108 ITR 345 (SC)
Mathuram Agrawal v.State of Madhya Pradesh AIR 2000 SC 109
(In the taxing statute a person or a transaction cannot be subjected to tax on the ground of
spirit of the law or by inference or by analogy)
BENEFICIAL CONSTRUCTION
In cases where there are two interpretations possible, the one which is beneficial to the
assessee would be preferred. This principle was laid down in a landmark judgment in IRC
v. Duke of Westminister 1936 AC 1 wherein Tomlin L J. stated that an assessee may
arrange his affairs within the bounds of the law so as to minimise the incidence of tax.
PURPOSIVE CONSTRUCTION
Golden rule, purpose/ intention of the legislature- limited application
Literal rule to take precedence
Sindhi Transport Company v. State of U.P.
HARMONIOUS CONSTRUCTION
CONSTRUCTION OF PENAL PROVISIONS
Strict interpretation
Prospective in operation and not retrospective
Presumption of mens rea
Charging and procedural provisions

 Charging section strict interpretation

Procedural provisions- liberal/normal rules of interpretation
Use of purposive rule of construction
Bajaj Tempo Ltd. 196 ITR 188 (SC) A provision in a taxing statute granting incentives
for promoting growth and development should be construed liberally, and since as
provision for promoting economic growth has to be interpreted liberally, the
restriction on it too has to be construed so as to advance the objective of the
provision and not to frustrate it.
The object of provisions of taxing statute being to promote the setting of the new
units and to increase the production of goods such provision has to be interpreted
liberally so that the object can be achieved, as held by Supreme Court in the case
of :
Commissioner Trade Tax vs. DSM Group of Industries
EXTERNAL AIDS TO INTERPRETATION
Finance Ministers speech
There is no bar in resorting to or referring to speech of FM. Interpretation of a statute being an
exercise in the ascertainment of meaning, everything which is logically relevant should be
admissible Chunnilal Onkarmal (P.) Ltd. v. UOI [1996] 221 ITR 459 (MP)
Generalia Specialibus Non Derogant
In the case of overlapping provisions- freedom of the assessee to chose the one
imposing a lighter burden
The Courts have held the expression to mean that when there is a conflict between
a general and special provision, the latter shall prevail as held in the cases of CIT v.
Shahzada Nand and Sons 60 ITR 392 (SC)
Vodafone International Holdings V. UOI
Issue- taxability in India of offshore transfer of shares of a Cayman Islands company
by the Hutchison Group to the Vodafone Group.
Sec 9- charging section for capital gains
Direct and indirect transfer
Literal rule and purposive rule of contruction
Amendment to the definition of transfer:
Explanation 2.For the removal of doubts, it is hereby clarified that "transfer" includes and
shall be deemed to have always included disposing of or parting with an asset or any
interest therein, or creating any interest in any asset in any manner whatsoever, directly
or indirectly, absolutely or conditionally, voluntarily or involuntarily, by way of an
agreement (whether entered into in India or outside India) or otherwise, notwithstanding
that such transfer of rights has been characterised as being effected or dependent upon
or flowing from the transfer of a share or shares of a company registered or incorporated
outside India;]

(iii) REMEDIAL STATUTES

Usually given retrospective effect, but not necessarily.
E.g., In Central Bank of India v. Their Workmen:
The proviso introduced in s.10(b)(ii) of the Companies Act, 1919 by the 1956
Amendment Act was held to not have a retrospective effect, although remedial in
nature.
A statute affects substantive rights is presumed to be prospective in operation unless
made retrospective expressly

 A statute that merely affects procedure, unless such a construction is textually

impossible, is presumed to be retrospective in its application, should not be given an
extended meaning and should be strictly confined to its clearly defined limits.

(iv) DECLARATORY STAUTES

Also called a Clarificatory Enactment and generally operates retrospectively.
e.g., In Central bank of India v. Workmen, it was observed by the Court that a
declaratory Act is usually passed to set aside a judicial error, whether in the statement
of common law or in the interpretation of statutes.

(v)

STATUTES OF LIMITATION

A subsequent Limitation Act cannot provide for a longer period of limitation than that
provided in the earlier Act. Similarly a subsequent Act may provide for a shorter period
of limitation than the one provided by an earlier Act.
Retrospectivity here, means that it shall apply to all legal proceedings initiated after
their operation for enforcement of a legal right accrued earlier. It is prospective in the
sense that one cannot revive a right of action already barred on the date of coming into
force.

(vi) STATUTES REGARDING APPEALS

Right to bring a suit is inherent.
Right o appeal may or may not be conditional, as its not an inherent right. Hence, its
been held to be not violative of Art. 14.
Observations of Court in Colonial Sugar Refining Co. Ltd. v. Irving:
a)
Remedy, suit, appeal and second appeal form a part of one legal proceeding
b)
Right of appeal is not a mere matter of procedure but is a substantive right
c)
Institution of suit is a primary Right, the Right to appeal is an incidental one
a) To ascertain application of retrospectivity on the proceedings of the suit or
the appeal, the law in force on the date of institution of such suit will be
taken into consideration and not the law in force on the date of decision or
of filing the appeal.
b) This right can be taken away only by subsequent enactment
The above principles were applied in the Garikapati Case and it was concluded that
after filing of an original proceeding if there is any change in law relating to appeal and
the change adversely affects this vested right of appeal, the change is presumed not to
be retrospective.

(vii) STATUTES AFFECTING FINALITY OF ORDERS

When an order is made final, it gives rise to a vested right and any subsequent change
in the law giving rise to a new right of appeal or revision is presumed not to affect the
finality of orders already made.
E.g., Delhi Cloth & General Mills v. CIT:

Under the Income Tax Act, 1922 there was no provision for appeal for certain orders. The
assessee was given a final award in January, 1926. Later in 1926, an amendment was made to
the Act granting aggrieved persons the right to appeal against the orders for which prior to
the amendment, there was no such right to appeal. The assessee challenged the order he had
obtained claiming that the amendment would have a retrospective application and he was
entitled to the right to appeal. Privy Council held: The amendment cannot be made to apply to
the assessee, as there was no right to appeal under the Act on the date on which the final
order was given.
However, when proceedings are instituted and no final order has been made yet, then if
the new law:
i.
or

reduces the existing right of appeal, it is presumed to have only prospective application;

ii.

increases or creates the right of appeal, it is presumed to have retrospective effect.

MODULE 10:
SUBORDINATE LEGISLATION
MIMANSA RULES OF INTERPRETATION

SUBORDINATE LEGISLATION STUDY FROM ADMIN LAW NOTES!

MIMANSA RULES OF INTERPRETATION

WHAT ARE THE MIMANSA RULES?

Traditional principles laid down by Jaimini in his sutras

Science of knowledge

Study and interpretation of Vedic texts

Vedic texts formed the basis of education

Conduct of yagyas before the sacrificial fire had to be in accordance with the
scriptures.

The texts were in Sanskrit often obscure and ambiguous hence required
interpretation.

Useful tool for sound interpretation of religious texts slowly started to be utilised for
other purposes Shrutis and Smritis

RULES AND PRINCIPLES

1. Samanjasya Principle analogous to the principle of harmonious construction
2. Principle of Vikalpa reason and justice

3. Badha similar to the doctrine of ultra vires

Apart from these primary rules, there exist other significant principles upon which the
Mimansakars relied while interpreting religious texts and scriptures:
a) Sarthakyata axiom: every word and sentence must have a meaning.
b) Laghava axiom: Simpler and shorter meaning preferred.
c) Arthaikatva axiom: Double meaning not to be attached to word occurring in the same
place/context.
d) Gunapradhan axiom: Word or sentence expressing subordinate idea clashes with the
principal idea, former must be adjusted to the latter or disregarded altogether.
e) Shruti principle: The literal rule of interpretation.
f) Linga principle or Lakshana artha: Suggestive power of words and expressions.
g) Prakarana: Construction of texts by referring to other related texts.
APPLICATION OF THE MIMANSA PRINCIPLES
Application of different Mimansa principles different and absurd results.
Were devised solely for the purpose of interpretation of religious texts must be utilised
accordingly: Keshavji Ravji and Co v CIT, Principles of interpretation are good servants
but bad masters.
Wealth of knowledge contained in the Mimansa principles can be utilised even today
however, certain difficulties in mastering and understanding Sanskrit.
Justice Markandey Katju has stressed on their importance and utilised these principles
in various cases.
Justice Markandey Katju has stated thus in B. Premanand & Others v Mohan Koikal
& Others:
It may be mentioned that it is not stated anywhere in the Constitution of India that
only Maxwells Principles of Interpretation can be utilised. We can utilise any system of
interpretation which can help to resolve a difficulty. Principles of interpretation are not
principles of law but are only a methodology for explaining the meaning of words used
in a text. There is no reason why we should not use Mimansa Principles of
Interpretation in appropriate occasions.
CASE LAW
The judgement of the Supreme Court of India in Uttar Pradesh State Agro
Industrial Corporation Ltd v Kisan Upbhokta Parishad and Ors (December 2007)
analyses Mimansa rules of interpretation.
FACTS: Union of cane growers in Meerut assistance for purchasing equipment
Animal Driven Vehicles subsidies provided by State Government for the purchase of
these equipment. State Government issued an order in November 1996 all equipment
must be purchased from the UP State Agro Industrial Corporation Ltd. Cane
Commissioner issued an order in March 1999 stating that ADV carts had to be
purchased from UP Agro Corporation.

 Writ petition by Kisan Upbhokta to Allahabad HC contended that ADV carts were not
equipment and hence the order of Cane Commissioner was in conflict with the earlier
order of State Government. If ADV carts were considered equipment in order to get
subsidy they could only be purchased from UP Agro Corp and not third parties.
Allahabad HC held in favour of Kisan Upbhokta.
UP State Agro Industrial Corporation went on appeal to the Supreme Court.
ISSUES RAISED: The question before the Supreme Court in the present appeal
whether Animal Driven Vehicles could be understood as equipment or implement?
ANALYSIS AND REASONING: Dictionary meanings of the words tool, implement,
equipment were analysed ordinary, popular, natural meaning to be assigned to
words. Sanskrit and Mimansa literature used to elucidate the meaning of this principle.
Several words in Sanskrit Pankaj, Jalaja, Kamal, Padma, Saroja, Sarsij, among others
which all mean Lotus Considering Pankaj, its etymological meaning derived from
Sanskrit means whatever grows in mud. However, the popular meaning is Lotus.
Mimansa principles applied: The popular meaning overpowers the etymological
meaning of the words Linga principle or Lakshana artha.
JUDGMENT: Applying the Mimansa principles to the present case, it was held that tools
or equipment in the context in which it was used was considered to mean things used
by humans with their hands or legs hence Animal Driven Vehicles or carts would not
come within the purview of the term.
The decision of the same court in M/s D.H. Brothers Pvt Ltd v Commissioner of
Sales Tax, Uttar Pradesh was also considered where it was held that sugarcane
crushers are not agricultural implements.
Appeal of the UP State Agro Corporation was thus dismissed.

MODULE 8: INTERPRETATION OF TAXING STATUTES

INTRODUCTION
Article 265 of the Constitution provides: No tax shall be levied or collected except by
authority of law
Article 366(28) of the Constitution which defines Taxation and Tax reads: Taxation
includes the imposition of any tax or impost whether general or local or special and
tax shall be construed accordingly

A tax is imposed for public purpose for raising general revenue of the State.
A fee in contrast is imposed for rendering services and bears a broad Co-relationship
with the services rendered.

A scrutiny of Lists I and II would show that there is no overlapping anywhere in the
taxing power and the Constitution gives independent sources of taxation to the Union

and the States. The taxing entries have to be construed with clarity and precision so as
to maintain this exclusivity.
In terms of Article 265 all acts relating to the imposition of tax providing, inter alia, for
the point at which the tax is to be collected, the rate of tax as also the recovery must
be carried out in accordance with law

THE TAX LAWS

Tax laws are highly complex, complicated and beyond understanding of a taxpayer. The words and expressions used are not simple. Many sections contain subsections, clauses, sub-clauses. Many deeming provisions have been inserted. Meaning
of an expression is extended by way of Explanation and is curtailed by way of proviso,
sometimes more than one provisos and explanations meaning differently
CHARGING AND MACHINERY PROVISION
The rule of construction of a charging section is that before taxing any person, it
must be shown that he falls within the ambit of the charging section by clear words
used in the section. No one can be taxed by implication. A charging section has to be
construed strictly

MODULE 9: INTERPRETATION OF PENAL STATUTES

INTRODUCTION
Some legislations are directed to cure some immediate mischief and bring into effect
some type of social reform by ameliorating the condition of certain class of persons who
according to present day notions may not have been fairly treated in the past. Such
legislations prohibit certain acts by declaring them invalid and provide for redress or
compensation to the persons aggrieved. If a statute of this nature does not make the
offender liable to any penalty in favour of the State, the legislation will be classified as
REMEDIAL
Penal statutes, on the other hand, are those which provide for penalties for
disobedience of the law and are directed against the offender in relation to the State by
making him liable to imprisonment, fine, forfeiture or other penalty. If the statute
enforces obedience to the command of the law by punishing the offender and not by
merely redressing an individual who may have suffered, it will be classified as PENAL .
A remedial statute receives a liberal construction, whereas a penal statute is strictly
construed.In case of remedial statutes the doubt is resolved in favour of the class of
persons for whose benefit the statute is enacted; whereas in case of penal statutes the
doubt is resolved in favour of the alleged offender.

STRICT CONSTRUCTION OF PENAL STATUTES

If a statute laid a mandatory duty but provided no mode of enforcing it, the
presumption in ancient days was that the person in breach of the duty could be made
liable for the offence of contempt of the statute. This rule of construction is now
obsolete and has no application to a modern statute. Clear language is now needed to
create a crime.

When in a statute dealing with a criminal offence impinging upon the liberty of citizens,
a loophole is found, it is not for Judges to cure it, for it is dangerous to derogate from
the principle that a citizen has a right to claim that howsoever much his conduct may
seem to deserve punishment, he should not be convicted unless that conduct falls fairly
within the definition of crime of which he is charged.
The duty of the court is to give effect to the purpose as expressed in clear and
unambiguous language and that obligation is not altered because the Act is penal in
character.

The basic rule of strict construction of penal statute is that a person cannot be
penalized without clear letter of law.
Presumptions and assumptions have no role in interpretation of penal statutes. They
are to be strictly constructed in accordance with the provisions of law. Nothing can be
implied.

Penal provision
circumstances.

cannot

be

extended

by

implication

to

particular

According to FRIEDMANN, the guiding principle of strict construction are:

case

or

Courts cannot create new offence.

Where court is faced with conflicting interpretation of language of a statute, either
of which is with reasonable construction, it must balance the legislative purpose
of the statute in light of the objects and policies, with principle that a person
should not be convicted of an offence which he can reasonably regard as a noncriminal action.

The general rule is that a penal statute should be strictly construed, that is, if two
possible and reasonable constructions can be put upon a penal provision, the court
must lean towards that construction which exempts the subject from penalty rather
than the one which imposes a penalty. It is not competent for the court to stretch the
meaning of an expression used by the legislature in order to carry out the intention of
the legislature. It is for the legislature and not for the court to define a crime and
provide for its punishment.

According to Maxwell, the prerequisite of express language for the creation of an

offence, in interpreting strictly words setting out the elements of an offence in requiring
the fulfillment to the letter of statutory conditions precedent to the infliction of
punishment; and in insisting on the strict observance of technical provisions concerning
criminal procedure and jurisdiction.

A.G. v. Sillem, (1864) 33 LJ Ex 92, p.110.Pollock , CB said: whether there be any

difference left between a criminal statute and any other statute not creating offence, I
should say that in criminal statute you must be quite sure that the offence charged is
within the letter of the law.

In the case of Feroze N. Dotivalaz v. P.M Wadhwani and co. (2003) 1 SCC 14
the court stated: Generally, ordinary meaning is to be assigned to any word or
phrase used or defined in a statute. Therefore, unless there is any vagueness or

ambiguity, no occasion will arise to interpret the term in a manner which may
add something to the meaning of the word which ordinarily does not so mean by
the definition itself, more particularly, where it is a restrictive definition. Unless
there are compelling reasons to do so, meaning of a restrictive and exhaustive
definition would not be expanded or made extensive to embrace things which are
strictly not within the meaning of the word as defined.

Tucker and Sons v. Priester (1887) 19 QBD 629..Lord Esher, MR in formulating the
settled rule of construction of penal sections observed if there is a reasonable
interpretation which will avoid the penalty in any particular case we must adopt that
construction. If there are two reasonable constructions then we must give the lenient
one.

In a very recent matter of State of Rajasthan v. Vinod Kumar (on 18 May, 2012)
the Apex Court has observed: - awarding punishment lesser than the minimum
prescribed under Section 376 IPC, is an exception to the general rule. Exception
clause is to be invoked only in exceptional circumstances where the conditions
incorporated in the exception clause itself exist. It is a settled legal proposition
that exception clause is always required to be strictly interpreted even if there is
a hardship to any individual. Exception is provided with the object of taking it out
of the scope of the basic law and what is included in it and what legislature
desired to be excluded

PURPOSIVE INTERPRETATION APPROACH

It is not necessary that courts must always favour the interpretation which is favourable
to the accused and not the prosecution but it may also chose to go for the
interpretation which is consistent with the object provided in the law.

In State of Maharashtra v. Tapas D. Neogy (1999) 7 SCC 685 the expression any
property in section 102 of Cr.P.C. was interpreted to be inclusive of a bank account
and hence a police officer who was investigating the matter was justified in seizing the
same. This principle was first explained by James, L.J. who stated: No doubt all penal
statutes are to be construed strictly, that is to say that the court must see that the
thing charged as an offence is within the plain meaning of the word used, and must not
strain the words on any notion that there has been a slip; that there has been a casus
omissus; that the thing is so clearly within the mischief that it must have been included
if thought of.

SUPPRESSION OF THE MISCHIEF

The language of the penal statute can also be interpreted in a manner which
suppresses the lacuna therein and to sabotage the mischief in consonance with the
Heydons Case. For instance in Ganga Hire Purchase Pvt. Ltd. Vs. State of Punjab,
AIR 2000 SC 499. while interpreting the section 60(3) of Narcotic Drugs and
Psychotropic Substances Act, 1985, the word owner was given a wider meaning for the
purpose of confiscation of the vehicle used in furtherance of the offence mentioned
therein i.e. inclusive of the registered owner where the vehicle was purchased under a
hire purchase agreement when all the installments were not paid by him.

The Honble Court observed that confessional statement is a substantive piece of

evidence and can be used against the co- accused by following the interpretation

provided in S.N. Dube vs. N.B. Bhoir, (2000) 2 SCC 254. where the Apex Court
observed that Section 15 of the TADA Act is an important departure from the ordinary
law and must receive that interpretation which would achieve the object of that
provision and not frustrate or truncate it and that correct legal position is that a
confession recorded under Section 15 of the TADA Act is a substantive piece of
evidence and can be used against a co- accused also, if held to be admissible,
voluntary and believable.

Similarly in the leading matter of Reema Aggarwal v. Anupam Aggarwal AIR 2004
SC 1418., a broader meaning was attributed to the application of sections 304B and
498A of the Indian Penal Code, in light of the broader purpose which was sought to be
achieved through these provisions and the mischief which was required to be cured. It
was also made applicable to the case where the legitimacy of the marriage itself was in
question to bring the accused within the purview of the word husband as used in the
said provisions
CONCLUSION
After the detailed analysis of various methods of interpreting a penal statute in the
paper we can broadly categorize the method of interpretation by concluding that
Firstly the basic rule of interpreting such laws is to strictly adhere to the language of the
statute since it is the will of the legislature and the court should restrain itself from
stretching the meaning of the words causing unnecessary hardships to the subjects.
Secondly it must be always kept in mind that what is the purpose for which the
enactment seeks to achieve and if a strict adherence is done will it be able to achieve
that purpose or object.
Thirdly and lastly whether by such an interpretation the mischief which was sought to
be suppressed by the penal law was suppressed and if not then it is the duty of the
court to ensure that it is done and just because of the Legislatures omission, the
injustice to the society should not be administered .