2016 (10) TMI 1229 - SC - Indian Laws

Telangana Legislature's Retroactive Law Validated, Upheld by Court

Cheviti Venkanna Yadav Versus State of Telangana and Ors.

The court upheld the competence of the Telangana State Legislature to legislate retrospectively, finding that the amendment effectively nullified the ... Constitutional validity of Sub-section (3) of Section 5 of the Andhra Pradesh (Agricultural Produce and Livestock) Markets (Amendment) Act, 2015 - the term of the market committee was reduced from three years to one year by giving retrospective effect in the Amendment Act - Whether the State Legislature could have legislated for the period prior to coming into existence of the State? - Held that:- The scheme of the States Reorganization Acts makes the laws applicable to the new areas until superseded, amended or altered by the appropriate legislature in the new States. This is what the legislature has done and there is nothing that can be said against such amendment - after the legislature came into existence, it has the competence to enact any law retrospectively or prospectively within the constitutional parameters. Whether the base of earlier judgment has been removed to erase the effect of the judgment? - Held that:- The legislature cannot, by way of an enactment, declare a decision of the court as erroneous or a nullity, but can amend the statute or the provision so as to make it applicable to the past. The legislature has the power to rectify, through an amendment, a defect in law noticed in the enactment and even highlighted in the decision of the court. This plenary power to bring the statute in conformity with the legislative intent and correct the flaw pointed out by the court, can have a curative and neutralizing effect. When such a correction is made, the purpose behind the same is not to overrule the decision of the court or encroach upon the judicial turf, but simply enact a fresh law with retrospective effect to alter the foundation and meaning of the legislation and to remove the base on which the judgment is founded. This does not amount to statutory overruling by the legislature. In this manner, the earlier decision of the court becomes non-existent and unenforceable for interpretation of the new legislation. No doubt, the new legislation can be tested and challenged on its own merits and on the question whether the legislature possesses the competence to legislate on the subject matter in question, but not on the ground of over-reach or colourable legislation. A nominated member, in praesenti, can also be removed by adopting the procedure during the period. Otherwise, he shall continue till his term is over; and the term is one year. The plea of vested right is like building a castle in Spain. It has no legs to stand upon and, therefore, we unhesitatingly repel the said submission. Different kinds of delineation with regard to market committee and the special market committees - Held that:- Their composition, function and purpose are different. They basically fall into different categories. It is difficult to weigh them in the scale of Article 14. The equality clause, in our considered view, is not affected. The characteristics of the committees being different, Article 14 is not attracted. Thus, the said submission is sans substratum. Appeal dismissed. Issues Involved:1. Competence of the State Legislature to legislate for the period prior to the existence of the State.2. Whether the base of the earlier judgment has been removed by the amendment.3. Whether vested rights have been affected by the amendment.4. Whether the amended provisions violate the equality clause under Article 14 of the Constitution.Issue-wise Detailed Analysis:1. Competence of the State Legislature to Legislate for the Period Prior to the Existence of the State:The court held that the State Legislature has the competence to enact laws retrospectively or prospectively within the constitutional parameters. This was supported by the precedent in M/s. Rattan Lal and Co. v. The Assessing Authority, Patiala, which clarified that post-reorganization, the new State's legislature can amend laws applicable to its area. The court concluded that the Telangana State Legislature could legislate for the period before the State's formation.2. Whether the Base of the Earlier Judgment has been Removed by the Amendment:The court examined whether the legislative amendment effectively removed the foundation of the earlier judgment that had declared certain provisions unconstitutional. Citing precedents like Shri Prithvi Cotton Mills Ltd. v. Broach Borough Municipality, the court noted that the legislature can retrospectively amend laws to remove the cause of invalidity identified by the courts. The court found that the amendment, by substituting 'appointed' with 'nominated' and making the term of office one year, removed the discrimination identified in the earlier judgment. Thus, the base of the earlier judgment had been effectively removed.3. Whether Vested Rights have been Affected by the Amendment:The court addressed the argument that the amendment affected the vested rights of the members, Chairmen, and Vice-Chairmen by curtailing their term. The court noted that these positions were filled by nomination rather than election or selection, and thus did not confer a vested right that could not be altered by legislative amendment. The court cited Om Narain Agarwal v. Nagar Palika, Shahjahanpur, which held that nominated members do not have the same rights as elected members and can be replaced at the government's pleasure. The court concluded that the amendment did not violate any vested rights.4. Whether the Amended Provisions Violate the Equality Clause Under Article 14 of the Constitution:The court examined whether the different treatment of market committees and special market committees violated Article 14. It found that the two types of committees served different functions and purposes, and thus could not be directly compared under the equality clause. The court concluded that the characteristics of the committees were sufficiently different to justify the different treatment, and thus Article 14 was not violated.Conclusion:The court dismissed the appeals, holding that the Telangana State Legislature had the competence to legislate retrospectively, the amendment effectively removed the base of the earlier judgment, no vested rights were violated, and the amended provisions did not infringe upon the equality clause under Article 14.