Act of State in territorial acquisition bars municipal review until de jure sovereignty is assumed by the new sovereign.

The acquisition of Junagadh was treated as a continuing act of State that began with the Government of India taking over administration and ended only on de jure sovereignty being assumed after integration with Saurashtra. Orders of resumption made before that stage were characterised as acts of State, so municipal courts could not examine their validity. Rights claimed under the former ruler's grants did not become enforceable against the new sovereign unless recognised expressly or impliedly by that sovereign. Section 299(1) of the Government of India Act, 1935 was held inapplicable because it protected only existing enforceable property rights recognised by the new sovereign.

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Issues: Whether the orders of resumption made by the Administrator before the integration of Junagadh were acts of State arising during the process of acquisition of sovereignty and, therefore, not justiciable in the municipal courts.

Analysis: The process of acquisition of Junagadh was treated as a continuous one that began with the Government of India taking over administration and ended only when de jure sovereignty was assumed on integration with Saurashtra. Until that stage, the residents of Junagadh did not acquire enforceable rights against the new sovereign merely by reason of the former ruler's grants. The impugned orders were passed before the act of State was complete, and the municipal courts could not examine their validity. The plea that the Administrator acted under law did not alter the true character of the orders, which were in substance acts of State. Section 299(1) of the Government of India Act, 1935 did not assist the respondents because it protected only existing enforceable property rights recognized by the new sovereign.

Conclusion: The suits were not maintainable and the orders of resumption were not justiciable in the municipal courts.

Ratio Decidendi: In an acquisition of territory, the act of State continues until de jure sovereignty is assumed by the new sovereign, and rights arising under the old regime are enforceable in municipal courts only if recognized expressly or impliedly by the new sovereign.

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