1971 (7) TMI 157 - SC - Indian Laws

Supreme Court Upholds Validity of Grant-in-aid Code Rules, Dismisses Constitutional Violation Claims

The Supreme Court upheld the validity of clauses (1) and (2) of Rule 3 of the Grant-in-aid Code, overturning the High Court's decision. The Court found ... - Issues Involved:1. Validity of clauses (1) and (2) of Rule 3 of the Grant-in-aid Code.2. Application of Article 19 and Article 14 of the Constitution.3. Procedural fairness and natural justice in the grant of permission to start schools.4. Validity of executive instructions and their application.Issue-wise Detailed Analysis:1. Validity of Clauses (1) and (2) of Rule 3 of the Grant-in-aid Code:The High Court held that clauses (1) and (2) of Rule 3 of the Grant-in-aid Code are invalid as they are too vague to afford any standard both as to the need of a school in the locality and also as to the unhealthy competition with an existing school. These clauses were also deemed vague regarding the competency and reliability of the management of the school. The High Court found no provision in these sub-clauses for hearing a party before the authorities concerned take a decision in the matter of grant or refusal of permission to start a school. Consequently, the High Court struck down these provisions and directed the educational authorities to grant permission to the two writ petitioners to start schools as desired by them.2. Application of Article 19 and Article 14 of the Constitution:The High Court's decision invoked Article 19, asserting that the clauses violated the rights guaranteed under Article 19(1). However, the Supreme Court found this invocation erroneous due to the Proclamation of Emergency in effect from October 26, 1962, to January 10, 1968, which suspended the operation of Article 19 under Article 358. Therefore, the restrictions in clauses (1) and (2) of Rule 3 were deemed reasonable restrictions in the interest of the general public. Regarding Article 14, the High Court's approach was found erroneous as the provisions regarding grant of permission and recognition of schools under the Code are mainly intended for receiving grants from the Government. The Supreme Court concluded that there was no violation of Article 14, as the decisions were based on recommendations by District Committees familiar with local conditions.3. Procedural Fairness and Natural Justice:The High Court criticized the lack of a provision for a hearing before rejecting an application. However, the Supreme Court noted that the applications were scrutinized by District Committees, which considered all relevant factors and recorded their reasons in writing. The Supreme Court held that the absence of a formal hearing did not constitute a violation of natural justice, given the detailed and transparent process followed by the District Committees and educational authorities.4. Validity of Executive Instructions:The Supreme Court emphasized that the provisions of the Grant-in-aid Code are executive instructions and administrative guidelines without statutory force. It was determined that these instructions were not vague and provided sufficient guidance to the District Committees. The Supreme Court referred to precedents stating that executive instructions cannot be struck down merely for being vague, and found that the High Court erred in this regard.Conclusion:The Supreme Court set aside the High Court's judgment allowing Special Civil Applications Nos. 420 and 421 of 1966, thereby upholding the validity of clauses (1) and (2) of Rule 3 of the Grant-in-aid Code. The Supreme Court confirmed the High Court's dismissal of Special Civil Application No. 694 of 1965, rejecting the appellant's challenge to the grant of permission to the third respondent. The appellants in Civil Appeals Nos. 160 and 161 of 1968 were awarded costs, while the appellant in Civil Appeal No. 878 of 1968 was ordered to pay costs to the first respondent.