Beneficial statutory construction binds the State where exclusion would frustrate the Act's machinery and purpose.

A beneficial construction of the Displaced Persons (Debts Adjustment) Act, 1951 required the State to be treated as bound by implication, even though section 13 and the definition of "debt" did not expressly name it. Reading the Act as a whole, the scheme of sections 5, 11, 32 and 47 showed that debts owed by the State had to be included when assessing a displaced debtor's assets and paying capacity. Excluding the State would have made the statutory machinery unworkable and defeated the Act's purpose of relieving displaced persons after partition. An application under section 13 was therefore maintainable against the State of Punjab.

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Issues: Whether a displaced creditor could maintain an application under section 13 of the Displaced Persons (Debts Adjustment) Act, 1951 against the State of Punjab, and whether a debt due from the State could fall within the Act by necessary implication.

Analysis: The expression "person" in section 13 and the definition of "debt" in section 2(6)(c) did not expressly name the State, but the Act had to be read as a whole. The scheme of sections 5, 11, 32 and 47 showed that debts owed by the State were required to be taken into account for determining a displaced debtor's assets and paying capacity, and the Act would be rendered unworkable if such debts were excluded. The beneficent object of the legislation, meant to relieve displaced persons after partition, would be frustrated unless the Government was bound. The earlier procedural legislation and the construction placed upon it did not control the later and broader Act of 1951.

Conclusion: The State was bound by the Act by necessary implication, and an application under section 13 was maintainable against it.

Ratio Decidendi: A statute of beneficent purpose will bind the State if, on a construction of its language, scheme and object, exclusion of the State would wholly frustrate the legislative intent and render the statutory machinery unworkable.

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