2017 (1) TMI 1492 - SC - Indian Laws

Validity of Ordinances Examined: Court Rules on Re-Promulgation and Enduring Rights

The court held that laying an Ordinance before the State Legislature is not mandatory under Article 213(2) of the Constitution. It was determined that an ... Power of Governor to promulgate Ordinances - Mandatory laying of Ordinances before the Legislature - Effect of an Ordinance ceasing to operate / 'cease to operate' - Enduring rights and irreversibility theory in relation to Ordinances - Re promulgation of Ordinances as a fraud on the Constitution - Judicial review of the satisfaction under Articles 123 and 213Mandatory laying of Ordinances before the Legislature - Effect of an Ordinance ceasing to operate / 'cease to operate' - Laying an Ordinance before the State Legislature is a mandatory constitutional obligation and failure to lay an Ordinance as required by Article 213(2) renders the Ordinance a colourable exercise of power and bereft of legal effect in the case of deliberate non placement. - HELD THAT: - The Court holds that Article 213(2)(a)'s command that every such Ordinance 'shall be laid before the Legislative Assembly' is mandatory and serves as the essential mechanism of legislative control. The deeming fiction that an Ordinance has the same force and effect as an Act operates only where the composite scheme of Article 213 is complied with. Non placement of an Ordinance before the legislature is a serious infraction and, where the executive has deliberately avoided compliance and thereby overreached the legislature, the Ordinance will not acquire the constitutional fiction of being equivalent to enacted law and will be of no consequence. The expression 'cease to operate' used in Article 213(2)(a) does not mean the Ordinance is void ab initio; however, that protection cannot be invoked where the mandatory duty to lay the Ordinance has been wilfully breached, and in such circumstances the Ordinances are a fraud on constitutional power. [Paras 31, 75, 80, 81]The requirement to lay an Ordinance before the Legislature is mandatory; deliberate failure to do so constitutes an abuse of power and the Ordinance will be deprived of legal effect in such circumstances.Enduring rights and irreversibility theory in relation to Ordinances - Effect of an Ordinance ceasing to operate / 'cease to operate' - Ordinances cannot, by themselves, create enduring or irreversible rights or confer permanence beyond their life; the 'enduring rights' and 'irreversible effect' theories as applied to Ordinances in Bhupendra Kumar Bose and T. Venkata Reddy are overruled. - HELD THAT: - The Court distinguishes between temporary Acts enacted by a legislature (which may contain savings clauses or be drafted to preserve consequences) and Ordinances promulgated by the Executive during recess. An Ordinance lacks the constitutional competence to attach enduring savings beyond its life; equating an Ordinance to a temporary legislative Act was erroneous. Consequently, rights, obligations or transactions concluded under an Ordinance do not automatically survive after the Ordinance ceases to operate unless validated by subsequent legislative action or where public interest/constitutional necessity (including genuine irreversibility) compels otherwise. The appropriate test for any survival of effects is one of public interest and constitutional necessity, and courts may mould relief in suitable cases. [Paras 68, 69, 70, 80]Ordinances do not create enduring or irreversible rights as a rule; Bhupendra Kumar Bose and T. Venkata Reddy are overruled to that extent, and survival of actions after cessation depends on public interest/constitutional necessity or subsequent legislative validation.Re promulgation of Ordinances as a fraud on the Constitution - Power of Governor to promulgate Ordinances - Re promulgation of Ordinances in the pattern exhibited in this case - repeated re promulgation without placement before the legislature - constitutes a fraud on the Constitution and is constitutionally impermissible; re promulgation is not per se always unlawful but must not be a mechanical device to bypass legislative supremacy. - HELD THAT: - The Court reaffirms that the Ordinance making power is exceptional and subject to legislative control; re promulgation after the legislature has had opportunity to legislate subverts that control. While re promulgation is not universally prohibited, it is legitimate only in rare, genuinely emergent circumstances where the Governor (on aid and advice) is satisfied on relevant material of necessity. The Bihar practice of serial re promulgation without placing Ordinances before the legislature was held to be a colourable exercise of power and a fraud on constitutional authority. [Paras 46, 75, 77, 80]The successive re promulgations in this case constitute a fraud on the Constitution and are invalid; re promulgation is permissible only in exceptional, justified circumstances and not as a mechanical device.Judicial review of the satisfaction under Articles 123 and 213 - Effect of an Ordinance ceasing to operate / 'cease to operate' - The satisfaction of the President/Governor under Articles 123 and 213 that circumstances necessitate immediate action is not immune from judicial review; review is limited and confined to whether there was relevant material, and whether the invocation amounted to fraud on power or was actuated by an oblique motive. - HELD THAT: - Following the deletion of clauses that once made the satisfaction final, the Court holds that judicial scrutiny is available though circumscribed. Courts will not probe adequacy or substitute their view where some relevant material exists; intervention is warranted where the record shows abuse, colourable exercise, or no real satisfaction (i.e., fraud on power or oblique purpose). This limited standard of review preserves both legislative supremacy and necessary judicial oversight. [Paras 36, 39, 80]The satisfaction under Articles 123/213 is open to limited judicial review: courts will sustain executive action where relevant material exists but will strike down acts that constitute a fraud on power or abuse of the Ordinance making process.Relief and consequences of invalid Ordinances - Effect of an Ordinance ceasing to operate / 'cease to operate' - All the Ordinances promulgated in the Bihar series (Ordinance 32 of 1989 to Ordinance 2 of 1992) were held to be fraudulent and bereft of legal effect; however, recoveries of salaries already paid to employees during the tenure of the Ordinances are not to be ordered. - HELD THAT: - Applying the principles above to the facts, the Court concludes that the pattern of non placement and serial re promulgation rendered every Ordinance in the chain constitutionally invalid and without legal consequences to create governmental status. Nonetheless, the Court moulds relief in equity: payments actually made to employees during the life of the Ordinances shall not be recovered, recognising legitimate reliance and public interest considerations. [Paras 71, 81, 82]The ordinances in the series are declared invalid and without legal effect; but no recovery shall be directed against employees for salaries paid during the currency of the Ordinances.Final Conclusion: The Court answers the reference by holding that the Ordinance making power is legislative but conditional; placing an Ordinance before the legislature is a mandatory constitutional obligation, re promulgation to circumvent legislative control is a fraud on the Constitution, and Ordinances cannot as a rule create enduring or irreversible rights. Applying these principles, the sequence of Bihar Ordinances (1989-1992) is held constitutionally invalid and without legal effect, but the Court protects salaries already paid during the life of those Ordinances by directing that no recovery be made. Issues Involved:1. Whether laying an Ordinance before the State Legislature is mandatory under Article 213(2) of the Constitution.2. Whether an Ordinance can create enduring or irreversible rights in a citizen.3. The legality of re-promulgation of an Ordinance.4. The validity of the specific Ordinances promulgated by the Governor of Bihar.5. The effect of concluded transactions under an Ordinance that has ceased to operate.Detailed Analysis:1. Mandatory Nature of Laying an Ordinance Before the Legislature:One judge expressed disagreement with the view that laying an Ordinance before the State Legislature is mandatory under Article 213(2) of the Constitution. It was argued that not laying an Ordinance before the Legislature does not invalidate it but merely causes it to cease to operate after six weeks from the reassembly of the Legislature. The Constitution does not provide any consequence other than the Ordinance ceasing to operate. Thus, it is not mandatory for the Executive to lay an Ordinance before the Legislative Assembly.2. Enduring or Irreversible Rights Created by an Ordinance:The judgment overruled the contrary views expressed in previous cases (State of Orissa v. Bhupendra Kumar Bose and T. Venkata Reddy v. State of Andhra Pradesh), stating that an Ordinance cannot create enduring or irreversible rights in a citizen. An Ordinance is constitutionally transient and cannot provide for any savings clause or contingency that would extend beyond its life.3. Legality of Re-promulgation of an Ordinance:The judgment held that the re-promulgation of an Ordinance by the Governor is not per se a fraud on the Constitution, but it should not be a mechanical exercise. The Governor must be satisfied that circumstances exist which render it necessary for immediate action. However, the re-promulgation of Ordinances without adequate justification, as seen in the case of Bihar, was deemed unconstitutional.4. Validity of Specific Ordinances Promulgated by the Governor of Bihar:The judgment concluded that the first three Ordinances, not being challenged by the employees, are assumed valid. However, the fourth and subsequent Ordinances were struck down due to inadequate justification by the State of Bihar, despite a specific challenge by the employees. The High Court's decision to strike down these Ordinances was upheld.5. Effect of Concluded Transactions Under an Ordinance:The judgment clarified that actions and transactions concluded under an Ordinance before it ceases to operate do not survive beyond its life. The Constitution does not attach any degree of permanence to actions or transactions pending or concluded during the currency of an Ordinance. The distinction between a temporary Act and an Ordinance was emphasized, noting that an Ordinance cannot constitutionally make provisions for enduring effects.Conclusion:The judgment provided a comprehensive analysis of the constitutional provisions related to the promulgation and re-promulgation of Ordinances, emphasizing the importance of legislative control and the temporary nature of Ordinances. The specific Ordinances in question were evaluated, leading to the conclusion that the first three were assumed valid due to lack of challenge, while the fourth and subsequent Ordinances were struck down. The judgment also clarified that concluded transactions under an Ordinance do not survive beyond its life, reinforcing the transient nature of Ordinances.