UNION OF INDIA v. RAJENDRA N. SHAH AND ANOTHER

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A 14. This question is not res integra as it has been considered by the Constitution Bench of this Court in Kihoto Hollohan v. Zachillhu and others2. The Court in the said case, was dealing with a challenge to the Tenth Schedule to the Constitution. Parliament, by virtue of the Tenth Schedule purported to deal with the evil of defection. After providing for various aspects, it also purported to oust the jurisdiction of all courts by B virtue of paragraph-7, which reads as follow: “7. Bar of jurisdiction of courts: Notwithstanding anything in this Constitution, no court shall have any jurisdiction in respect of any matter connected with the disqualification of the Member of a House under this Schedule.” C

15. The Court proceeded to uphold the provisions of the Tenth Schedule except paragraph-7. In doing so, this Court invoked the theory of Severability. It is, in this context, necessary to notice the following discussion: D “66. While examining the constitutional validity of laws the principle that is applied is that if it is possible to construe a statute so that its validity can be sustained against a constitutional attack it should be so construed and that when part of a statute is valid and part is void, the valid part must be separated from the invalid part. This is done by applying the doctrine of severability. The E rationale of this doctrine has been explained by Cooley in the following words: [ Cooley: Constitutional Limitations, (8th edn.) Vol. I pp. 359-60.] “It will sometimes be found that an act of the legislature is opposed in some of its provisions to the Constitution, while others, standing by themselves, would be unobjectionable. So the forms observed in passing it may be sufficient for some of the purposes sought to be accomplished by it, but insufficient for others. In any such case the portion which conflicts with the Constitution, or in regard to which the necessary conditions have not been observed, must be treated as a nullity. Whether the other parts of the statute must also be adjudged void because of the association must depend upon a consideration of the object of the law, and in what manner and to what extent the unconstitutional portion affects the remainder. A statute, it has been said, is judicially held to be 2 H (1992) Suppl.2 SCC 651

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unconstitutional, because it is not within the scope of legislative authority; it may either propose to accomplish something prohibited by the Constitution, or to accomplish some lawful, and even laudable object, by means repugnant to the Constitution of the United States or of the State. A statute may contain some such provisions, and yet the same act, having received the sanction of all branches of the legislature, and being in the form of law, may contain other useful and salutary provisions, not obnoxious to any just constitutional exception. It would be inconsistent with all just principles of constitutional law to adjudge these enactments void because they are associated in the same act, but not connected with or dependent on others which are unconstitutional.” C xxx xxx xxx

68. The doctrine of severability has been applied by this Court in cases of challenge to the validity of an amendment on the ground of disregard of the substantive limitations on the amending power, namely, alteration of the basic structure. But D only the offending part of the amendment which had the effect of altering the basic structure was struck down while the rest of the amendment was upheld. [See Kesavananda Bharati v. State of Kerala [(1973) 4 SCC 225 : 1973 Supp SCR 1] , Minerva Mills Ltd. v. Union of India [(1980) 3 SCC 625 : (1981) 1 SCR 206] E , P. Sambamurthy v. State of A.P. [(1987) 1 SCC 362 : (1987) 2 ATC 502 : (1987) 1 SCR 879] ].

69. Is there anything in the procedural limitations imposed by sub-article (2) of Article 368 which excludes the doctrine of severability in respect of a law which violates the said limitations? F Such a violation may arise when there is a composite Bill or what is in statutory context or jargon called a ‘Rag-Bag’ measure seeking amendments to several statutes under one amending measure which seeks to amend various provisions of the Constitution some of which may attract clauses (a) to (e) of the proviso to Article 368(2) and the Bill, though passed by the requisite G majority in both the Houses of Parliament has received the assent of the President without it being sent to States for ratification or having been so sent fails to receive such ratification from not less than half the States before the Bill is presented for assent. Such an Amendment Act is within the competence of Parliament insofar H

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A as it relates to provisions other than those mentioned in clauses (a) to (e) of proviso to Article 368(2) but in respect of the amendments introduced in provisions referred to in clauses (a) to (e) of proviso to Article 368(2), Parliament alone is not competent to make such amendments on account of some constitutionally recognised federal principle being invoked. If the doctrine of B severability can be applied it can be upheld as valid in respect of the amendments within the competence of Parliament and only the amendments which Parliament alone was not competent to make could be declared invalid.

70. Is there anything compelling in the proviso to Article C 368(2) requiring it to be construed as excluding the doctrine of severability to such an amendment? It is settled rule of statutory construction that “the proper function of a proviso is to except and deal with a case which would otherwise fall within the general language of the main enactment, and its effect is confined to that D case” and that where “the language of the main enactment is clear and unambiguous, a proviso can have no repercussion on the interpretation of the main enactment, so as to exclude from it by implication what clearly falls within its express terms”. [See: Madras & Southern Mahratta Railway Company Ltd. v. Bezwada Municipality [(1944) 71 IA 113, 122 : AIR 1944 E PC 71 : 48 CWN 618] , CIT v. Indo-Mercantile Bank Ltd. [1959 Supp 2 SCR 256, 266 : AIR 1959 SC 713 : (1959) 36 ITR 1]

71. The proviso to Article 368(2) appears to have been introduced with a view to giving effect to the federal principle. In the matter of amendment of provisions specified in clauses (a) to F (e) relating to legislative and executive powers of the States vis- a-vis the Union, the Judiciary, the election of the President and the amending power itself, which have a bearing on the States, the proviso imposes an additional requirement of ratification of the amendment which seeks to effect a change in those provisions G before the Bill is presented for the assent of the President. It is salutary that the scope of the proviso is confined to the limits prescribed therein and is not construed so as to take away the power in the main part of Article 368(2). An amendment which otherwise fulfils the requirements of Article 368(2) and is outside the specified cases which require ratification cannot be denied H

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legitimacy on the ground alone of the company it keeps. The main part of Article 368(2) directs that when a Bill which has been passed by the requisite special majority by both the Houses has received the assent of the President “the Constitution shall stand amended in accordance with the terms of the Bill”. The proviso cannot have the effect of interdicting this constitutional declaration and mandate to mean that in a case where the proviso has not been complied — even the amendments which do not fall within the ambit of the proviso also become abortive. The words “the amendment shall also require to be ratified by the legislature” indicate that what is required to be ratified by the legislatures of the States is the amendment seeking to make the change in the provisions referred to in clauses (a) to (e) of the proviso. The need for and the requirement of the ratification is confined to that particular amendment alone and not in respect of amendments outside the ambit of the proviso. The proviso can have, therefore, no bearing on the validity of the amendments which do not fall within its ambit. Indeed the following observations of this Court in Sajjan Singh case [(1965) 1 SCR 933 : AIR 1965 SC 845] are apposite: (SCR p. 940) “In our opinion, the two parts of Article 368 must on a reasonable construction be harmonised with each other in the sense that the scope and effect of either of them should not be allowed to be unduly reduced or enlarged.” xxx xxx xxx

73. A similar situation can arise in the context of the main part of Article 368(2) which provides: “when the Bill is passed in each House by a majority of the total membership of that House and by a majority of not less than two-thirds of the Members of that House present and voting, it shall be presented to the President”. Here also a condition is imposed that the Bill shall be presented to the President for his assent only after it has been passed in each House by the prescribed special majority. An G amendment in the First and Fourth Schedules referable to Article 4 can be introduced by Parliament by an ordinary law passed by simple majority. There may be a Bill which may contain amendments made in the First and Fourth Schedules as well as amendments in other provisions of the Constitution excluding those H

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A referred to in the proviso which can be amended only by a special majority under Article 368(2) and the Bill after having been passed only by an ordinary majority instead of a special majority has received the assent of the President. The amendments which are made in the First and Fourth Schedules by the said Amendment Act were validly made in view of Article 4 but the amendments in other provisions were in disregard to Article 368(2) which requires a special majority. Is not the doctrine of severability applicable to such an amendment so that amendments made in the First and Fourth Schedules may be upheld while declaring the amendments in the other provisions as ineffective? A contrary view excluding the doctrine of severability would result in elevating a procedural limitation on the amending power to a level higher than the substantive limitations. xxx xxx xxx

75. In that case, it was found that Section 41 of the Bribery D Amendment Act, 1958 made a provision for appointment of a panel by the Governor-General on the advice of the Minister of Justice for selecting members of the Bribery Tribunal while Section 55 of the Constitution vested the appointment, transfer, dismissal and disciplinary control of judicial officers in the Judicial Service E Commission. It was held that the legislature had purported to pass a law which, being in conflict with Section 55 of the Order in Council, must be treated, if it is to be valid, as an implied alteration of the constitutional provisions about the appointment of judicial officers and could only be made by laws which comply with the special legislative procedure laid down in Section 29(4). Since F there was nothing to show that the Bribery Amendment Act, 1951 was passed by the necessary two-thirds majority, it was held that “any Bill which does not comply with the condition precedent of the proviso, is and remains, even though it receives the Royal Assent, invalid and ultra vires”. Applying the doctrine of severability G the Judicial Committee, however, struck down the offending provision, i.e. Section 41 alone. In other words passing of the Bill by a special majority was the condition precedent for presentation of the Bill for the assent. Disregard of such a condition precedent for presenting a Bill for assent did not result in the entire enactment being vitiated and the law being declared invalid in its entirety but H

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[K. M. JOSEPH, J.]

it only had the effect of invalidation of a particular provision which offended against the limitation on the amending power. A comparison of the language used in clause (4) of Section 29 with that of Article 368(2) would show that both the provisions bear a general similarity of purpose and both the provisions require the passing of the Bill by special majority before it was presented for assent. The same principle would, therefore, apply while considering the validity of a composite amendment which makes alterations in the First and Fourth Schedules as well as in other provisions of the Constitution requiring special majority under Article 368(2) and such a law, even though passed by the simple majority and not by special majority, may be upheld in respect of the amendments made in the First and Fourth Schedules. There is really no difference in principle between the condition requiring passing of the Bill by a special majority before its presentation to the President for assent contained in Article 368(2) and the condition for ratification of the amendment by the legislatures of not less than one-half of the States before the Bill is presented to the President for assent contained in the proviso. The principle of severability can be equally applied to a composite amendment which contains amendments in provisions which do not require ratification by States as well as amendment in provisions which require such ratification and by application of the doctrine of severability, the amendment can be upheld in respect of the amendments which do not require ratification and which are within the competence of Parliament alone. Only these amendments in provisions which require ratification under the proviso need to be struck down or declared invalid. F

76. The test of severability requires the Court to ascertain whether the legislature would at all have enacted the law if the severed part was not the part of the law and whether after severance what survives can stand independently and is workable. If the provisions of the Tenth Schedule are considered in the background of the legislative history, namely, the report of the G ‘Committee on Defections’ as well as the earlier Bills which were moved to curb the evil of defection it would be evident that the main purpose underlying the constitutional amendment and introduction of the Tenth Schedule is to curb the evil of defection which was causing immense mischief in our body politic. The H

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A ouster of jurisdiction of courts under Paragraph 7 was incidental to and to lend strength to the main purpose which was to curb the evil of defection. It cannot be said that the constituent body would not have enacted the other provisions in the Tenth Schedule if it had known that Paragraph 7 was not valid. Nor can it be said that the rest of the provisions of the Tenth Schedule cannot stand on B their own even if Paragraph 7 is found to be unconstitutional. The provisions of Paragraph 7 can, therefore, be held to be severable from the rest of the provisions.” (Emphasis supplied)

C 16. The first Rule laid down in R.M.D. Chamarbaugwalla (supra) is that, it is the intention of the Legislature, that is the determining factor. The test is also laid down that the question to be asked is, whether the Legislature would have enacted the valid Part, if it had known that the rest of the Statute was invalid. It is apposite to read another Rule, which is laid down, which is Rule No.7. In determining the legislative intent, it D will be legitimate to take into account, the history of the legislation and its objects, inter-alia. The Statement of Objects and Reasons for the Ninety-Seventh Amendment, reads as follows: “STATEMENT OF OBJECTS AND REASONS

E The co-operative sector, over the years, has made significant contribution to various sectors of national economy and has achieved voluminous growth. However, it has shown weaknesses in safeguarding the interests of the members and fulfilment of objects for which these institutions were organised. There have been instances where elections have been postponed indefinitely F and nominated office bearers or administrators remaining in-charge of these institutions for a long time. This reduces the accountability of the management of co-operative societies to their members. Inadequate professionalism in management in many of the co- operative institutions has led to poor services and low productivity. G Co-operatives need to run on well-established democratic principles and elections held on time and in a free and fair manner. Therefore, there is a need to initiate fundamental reforms to revitalize these institutions in order to ensure their contribution in the economic development of the country and to serve the interests of members and public at large and also to ensure their autonomy, democratic H functioning and professional management.

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2. The “co-operative societies” is a subject enumerated in Entry A 32 of the State List of the Seventh Schedule of the Constitution and the State Legislatures have accordingly enacted legislations on co-operative societies. Within the framework of State Acts, growth of co-operatives on large scale was envisaged as part of the efforts for securing social and economic justice and equitable distribution of the fruits of development. It has, however, been experienced that in spite of considerable expansion of co- operatives, their performance in qualitative terms has not been up to the desired level. Considering the need for reforms in the Co- operative Societies Acts of the States, consultations with the State Governments have been held at several occasions and in the conferences of State Co-operative Ministers. A strong need has been felt for amending the Constitution so as to keep the co- operatives free from unnecessary outside interferences and also to ensure, their autonomous organisational set up and their democratic functioning. D

3. The Central Government is committed to ensure that the co- operative societies in the country function in a democratic, professional, autonomous and economically sound manner. With a view to bring the necessary reforms, it is proposed to incorporate a new Part in the Constitution so as to provide for certain provisions covering the vital. aspects of working of co-operative societies like democratic, autonomous and professional functioning. A new article is also proposed to be inserted in Part IV of the Constitution (Directive Principles of State Policy) for the States to endeavour to promote voluntary formation, autonomous functioning, democratic control and professional management of cooperative societies. The proposed new Part in the Constitution, inter alia, seeks to empower the Parliament in respect of multi-State co- operative societies and the State Legislatures in case of other co- operative societies to make appropriate law, laying down the following matters, namely:- G (a) provisions for incorporation, regulation arid winding up of co- operative societies based on the principles of democratic member- control, member-economic participation and autonomous functioning;

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A (b) specifying the maximum number of directors of a co-operative society to be not exceeding twenty-one members; (c) providing for a fixed term of five years from the date of election in respect of the elected members of the board and its office bearers; B (d) providing for a maximum time limit of six months during which a board of directors of co-operative society could be kept under supersession or suspension; (e) providing for independent professional audit;

C (f) providing for right of information to the members of the co- operative societies; (g) empowering the State Governments to obtain periodic reports of activities and accounts of co-operative societies; (h) providing for the reservation of one seat for the Scheduled D Castes or the Scheduled Tribes and two seats for women on the board of every co-operative society, which have individuals as members from such categories; (i) providing for offences relating to co-operative societies and penalties in respect of such offences.

4. It is expected that these provisions will not only ensure the E autonomous and democratic functioning of co-operatives, but also ensure the accountability of management to the members and other stakeholders and shall provide for deterrence for violation of the provisions of the law.

5. The Bill seeks to achieve the above objectives.” F (Emphasis supplied)

17. From the Statement Objects and Reasons, the following is discernible.

18. There were weaknesses found in safeguarding the interests G of the members of the cooperative societies. Elections were being postponed indefinitely. There was inadequate professionalism in management. It was found that cooperatives needed to be run on well- established democratic principles and elections had to be held on time and in a free and fair manner. It was further noted that “cooperative societies” is a subject enumerated in Entry 32 of the State List of the H

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Seventh Schedule. That laws were made by the State Legislatures, were noticed. Reforms, were in short, found necessary in the Cooperative Society Acts of the States. Consultation with the State Governments were held several times. The Central Government was committed, it is stated to ensure that the cooperative societies, in the country, were to function in a democratic, professional, autonomous and economically sound manner. It is in this connection that Part IXB was inserted to empower Parliament in respect of multistate cooperative societies, and State Legislatures, in case of other cooperative societies, to make appropriate law.

19. The intention, therefore, discernible was that Parliament intended to provide a uniform set of legislative norms and create rights, liabilities and powers across the board through the length and breadth of the country. In fact, it was to inform all cooperative societies, whether they were governed by laws made by the State Legislatures, falling under Entry 32 of List II of Seventh Schedule, or the appropriate Entry under List I. D

20. In other words, homogeneity was sought to be introduced without any discrimination between cooperative societies falling within the legislative domain of State Legislatures and of Parliament. The setting and the manner, in which the Articles have been ordered in Part IXB, would go to show that the substantive provisions, which actually E conditioned the legislative power, among other things, was directed against the State Legislatures.

21. The second Rule laid down in R.M.D. Chamarbaugwalla (supra) is to enquire whether the valid and invalid provisions are so inextricably mixed up that they cannot be separated from one another. It F is further declared that if the seemingly valid provisions are so distinct and separate, that after declaring the other set of provisions as invalid, the remaining provisions would remain a complete Code, independent of the rest, then, the distinct and separate provisions, which manifests a complete Code, can become enforceable. G

22. The third Rule provides that even if they (the provisions) are distinct and separate, if they all form part of a single scheme, which is intended to be operative as a whole, then, also the invalidity of a part, will result in failure of a whole. In Kihoto Hollohan (supra), this Court, after bearing in mind the Rules, apparently laid down in R.M.D. H

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A Chamarbaugwalla(supra), has proceeded to clearly articulate (in paragraph-76) the test, inter-alia, viz., as to whether, after severance, what survives, can stand independently and is workable.

23. In this regard, it is plain from the Statement of Objects and Reasons, that Parliament was fully aware that Entry 32 clothed the B Legislatures of the State with exclusive legislative power to make laws in regard to cooperative societies, which were not multistate cooperative societies. Parliament was fully aware that laws had already been made by State Legislatures, but yet, the object was to usher in reforms by the legislative route, and what is more, a Constitutional Amendment, which clearly involved, a change in regard to the entrenched provisions. The C Ninety-Seventh Amendment was passed in 2012, several years after the decision in Kihoto Hollohan (supra). It is clear that the law was laid down by the Constitution Bench of this Court in Kihoto Hollohan (supra), that having regard to the sublime purpose behind the proviso to Article 368(2), which was to foster and secure the federal nature of the D Constitution, what mattered was the substance and not the form. It appears to be further clear that an effort was made to take the States on board by holding several meetings between the States, and what is more, Resolutions were passed apparently at the meet of State Cooperative Ministers. All of this appears to point out that, having regard to the law holding the field and the relevant principles in question, it appears that E Parliament would not have made the amendment, had it known that the provisions contained in Articles 243ZI to 243ZQ would not pass muster. The object was clearly to have identical provisions in place to govern cooperative societies. Uniformity and, in fact, identical treatment for all cooperative societies whether they are created under State Law or by F Parliament, was the goal.

24. It is true that what the proviso to Article 368(2) contemplates is, that the ratification by the requisite number of States is done before the Bill is presented to the President of India for assent.

25. It is the duty of the Court to strive to uphold the law made by the Legislature. When it comes to an amendment to the Constitution, this presumption of constitutionality, and also the duty of the Court, becomes even more pronounced. If, indeed, on the Doctrine of Severability, the provisions contained in Article 243QR and Article 243QS, can be sustained, I would agree that the law must survive rather than perish. The question, however, is on the terms of the provisions in question

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(Articles 243QR and 243QS), and bearing in mind the principles, can A they survive on their own, after the invalidation of Article 243ZH to Article 243ZQ and Article 243ZT.

26. In Kihoto Hollohan (supra), it must be noticed that the court in the said case came to the rescue of Parliament by applying the Doctrine of Severability and found no difficulty in sustaining the provisions of the B Tenth Schedule, even after jettisoning the provisions of paragraph-7. It was found that pronouncing the said provision as infirm had no impact on the workability of the other provisions which related to and provided for remedies against the evil of defection.

27. The question boils down to this. Are the provisions of Article C 243ZR and 243ZS independent provisions and workable? For the sake of clarity, the provisions are referred in question namely Article 243ZR and 243ZS. “243ZR. Application to multi-State co-operative societies. – The provisions of this Part shall apply to the multi-State co-operative D societies subject to the modification that any reference to “Legislature of a State”, “State Act” or “State Government” shall be construed as a reference to “Parliament”, “Central Act” or “the Central Government” respectively. 243ZS. Application to Union territories. – The provisions of this E Part shall apply to the Union territories and shall, in their application to a Union territory, having no Legislative Assembly as if the references to the Legislature of a State were a reference to the administrator thereof appointed under article 239 and in, relation to a Union territory having a Legislative Assembly, to that Legislative Assembly: F Provided that the President may, by notification in the Official Gazette, direct that the provisions of this Part shall not apply to any Union territory or part thereof as he may specify in the notification.” G

28. Both these provisions are entirely dependent upon the provisions contained in Article 243ZI to 243ZQ. This is for the reason that both these provisions expressly provide that the ‘provisions of this part’, which clearly means the foregoing provisions, which are contained in Article 243ZI to 243ZQ, are to apply in regard to multistate cooperative societies and to Union Territories with the modifications, which are indicated therein. H

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A There can be application and modifications of something which exists. There cannot be either, when the elaborate provisions are to be treated as not born.

29. Are these provisions independent and workable? I will proceed on the basis that Parliament intended to produce homogeneity in regard B to certain legislative value judgments which would be cast in stone in a manner of speaking by having those values declared in the grundnorm itself. It would appear to be that these values were to apply, across the board, to cooperative societies born under laws made by the State Legislatures, as also, to those made by Parliament.

C 30. More importantly, once the Court has painted the relevant provisions, which are the substantial provisions (Article 243ZI to 243ZQ), with the brush of unconstitutionality, rendering those provisions, still born, it would appear that the provisions contained in Article 243ZR and Article 243ZS would not have the crutches without which these provisions cease to be workable and are impossible to sustain. The unconstitutional part, which is to be an integral part of Article 243ZR and Article 243ZS, must continue to exist, if the provisions’, in question, are to bear life. In other words, to sustain these provisions the court would have to resurrect the dead provisions contained in Article 243ZI to 243ZQ and Article 243ZT. The Doctrine of Severability must apply on surer foundations. It is my view that unless the provisions, which have been found unconstitutional, are kept alive, Articles 243R and 243ZQ are plainly unworkable.

31. In this view of the matter, I respectfully disagree with the view taken by my learned and esteemed Brother in regard to the application of the Doctrine of Severability.

F 32. In this view of the matter, the Appeals are dismissed.

Devika Gujral Appeals disposed of.