Final judicial findings and lease rights upheld in the Mullaperiyar dispute; later legislation could not override them.

The 1886 lease deed was treated as an ordinary contractual arrangement, not a political treaty, and was held to remain valid and enforceable against Kerala; the suit was maintainable under Article 131. The 2006 Kerala Amendment Act, insofar as it sought to fix a lower reservoir level, declare the dam endangered and override the earlier safety determination, was held unconstitutional and ultra vires because a legislature cannot directly reverse a final judicial finding between the same parties; the prior judgment operated as res judicata. Kerala was not permitted to deny that the Periyar river was inter-State, and its proposal to construct a new dam could not be imposed unilaterally on Tamil Nadu or displace rights under the existing decree.

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Issues: (i) Whether the suit was maintainable under Article 131 and whether the 1886 lease deed remained valid, binding and enforceable against Kerala. (ii) Whether the Kerala Irrigation and Water Conservation (Amendment) Act, 2006 was unconstitutional and ultra vires in its application to the Mullaperiyar dam, and whether the earlier judgment on dam safety operated as res judicata and could not be nullified by legislation. (iii) Whether Kerala could contend that Periyar river was not an inter-State river. (iv) Whether Kerala's offer to construct a new dam could displace Tamil Nadu's rights under the existing decree.

Issue (i): Whether the suit was maintainable under Article 131 and whether the 1886 lease deed remained valid, binding and enforceable against Kerala.

Analysis: The lease was treated as an ordinary non-political agreement and not as a treaty or act of state. By virtue of Section 177 of the Government of India Act, 1935, the Province of Madras became the lessee under the existing contract. Section 7(1)(b) of the Indian Independence Act, 1947 was held to apply only to political treaties and agreements, and there was no unequivocal denouncement of the lease after 15.08.1947. The later supplemental agreements of 1970 were relied on as further recognition of the continuing lease. The suit therefore fell within the original jurisdiction under Article 131, and the proviso to Article 131 did not bar it. Article 295 also supported succession to the relevant rights and liabilities.

Conclusion: The suit was maintainable, and the 1886 lease deed was valid, binding and enforceable against Kerala.

Issue (ii): Whether the Kerala Irrigation and Water Conservation (Amendment) Act, 2006 was unconstitutional and ultra vires in its application to the Mullaperiyar dam, and whether the earlier judgment on dam safety operated as res judicata and could not be nullified by legislation.

Analysis: The earlier judgment had conclusively found, on the basis of evidence and the Expert Committee report, that raising the reservoir level to 142 ft would not endanger the dam. The impugned amendment fixed the Full Reservoir Level at 136 ft, treated the dam as endangered, empowered a statutory authority to regulate safety and decommissioning, and purported to override the prior judgment. That was held to be a direct legislative reversal of a final judicial determination on facts, not a valid curative or validating law. The Court held that such an enactment violated separation of powers and rule of law. Since the earlier decision was final between the parties, the findings regarding safety and the lease issues operated as res judicata in the later suit.

Conclusion: The 2006 Amendment Act was unconstitutional and ultra vires in its application to the Mullaperiyar dam, the earlier judgment bound the parties, and Kerala could not reopen or negate those issues.

Issue (iii): Whether Kerala could contend that Periyar river was not an inter-State river.

Analysis: The Court noted that Kerala itself had earlier invoked the river-dispute bar and had proceeded on the footing that Periyar was inter-State. The materials also showed that a portion of the Periyar basin lay in Tamil Nadu. On the evidence, Kerala did not discharge the burden of proving that the river was purely intra-State, and it was inconsistent for Kerala to take a contrary stance after the earlier litigation.

Conclusion: Kerala was not permitted to contend that Periyar river was not an inter-State river.

Issue (iv): Whether Kerala's offer to construct a new dam could displace Tamil Nadu's rights under the existing decree.

Analysis: The suggestion of a new dam was treated as requiring the consent of both States and was not capable of being imposed unilaterally on Tamil Nadu. The existing dam had already been found safe, and the rights declared in the earlier judgment remained enforceable. The alternative proposal was noted as a possible basis for an amicable arrangement, but it did not override the adjudicated rights of Tamil Nadu.

Conclusion: Kerala's offer to construct a new dam could not be thrust upon Tamil Nadu and did not affect the existing decree.

Final Conclusion: The existing lease and the earlier safety determination were upheld, the 2006 Amendment Act was struck down as it applied to the Mullaperiyar dam, Tamil Nadu was entitled to raise the water level to 142 ft and carry out repair works, and a supervisory mechanism was directed to monitor implementation.

Ratio Decidendi: A legislature cannot, by a subsequent enactment, reverse or neutralise a final judicial determination of fact between the same parties; it may only remove the legal basis of a judgment through valid validating legislation within its competence, and not by direct legislative overruling of the decision itself.

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