Full Judgment Text
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 35
PETITIONER:
THE BOARD OF TRUSTEES, AYURVEDIC ANDUNANI TIBIA COLLEGE, DEL
Vs.
RESPONDENT:
THE STATE OF DELHI AND ANOTHER
DATE OF JUDGMENT:
23/10/1961
BENCH:
DAS, S.K.
BENCH:
DAS, S.K.
SINHA, BHUVNESHWAR P.(CJ)
SARKAR, A.K.
AYYANGAR, N. RAJAGOPALA
MUDHOLKAR, J.R.
CITATION:
1962 AIR 458 1962 SCR Supl. (1) 156
CITATOR INFO :
R 1966 SC1307 (8)
RF 1970 SC 564 (192)
D 1971 SC 966 (10)
RF 1976 SC 386 (14)
RF 1983 SC 1 (67)
R 1985 SC 973 (5)
ACT:
Registered Society-Whether a corporation-
State enactment dissolving such Society and
setting up corporation in its place-
Constituitiionality of-Tibbia College Act, 1952
(Delhi 5 of 1952). -Registered, Societies Act 1860
(21 of 1860), ss. 5,6,7,13,14- Government of Part
C States Act, 1951 (49 of 1951), s.20-Constitution
of India, Arts. 14, 19(1)(f), 31 and Seventh
Schedule, List I Entry 44, List II Entry 32, List
III Entries 10 and 28.
HEADNOTE:
The Board of Trustees, Ayurvedic and Unani
Tibbia College, Delhi was registered under the
Societies Registration Act, 1860. It ran the
Tibbia College, Delhi and an attached hostel and
managed the Hindustani Dawakhana. The Delhi State
Legislature passed the Tibbia College Act, 1952,
which dissolved the Board, incorporated a new
Board and vested all the property and all the
rights, powers and privileges of the old Board in
the new Board. The petitioners challenged the
validity of the Act on the grounds that the old
Board was a corporation whose objects were not
confined to Delhi and legislation with regard to
it would fall under Entry 44 of List I of the
Seventh Schedule to the Constitution and as such
the State Legislature was not competent to pass
the impugned Act, (ii) that the setting up of a
new Board as corporation was beyond the powers of
the State Legislature, (iii) that the Act violated
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 35
Arts. 14,19 and 31 of the Constitution, (iv) that
the Act could not override the Societies
Registration Act, 1860 which was a Central Act,
and (v) that the legislature acted mala fide in
passing the impugned Act.
^
Held, (per Sinha, C. J. Das, Sarkar and
Ayyangar,JJ.) that the State Legislature was
competent to enact the impugned Act. On
registration under the Societies Registration Act
the old Board did not become a corporation in the
sen e of being incorporated within the meaning of
Entry 44 of List I; it continued to be an
unincorporated society though under the provisions
of the Societies Registration Act it had certain
privileges analogous to those of corporations. The
provisions in the impugned Act relating to the
dissolution of the old Board fell within the
second part of Entry 32 of List II which included
unincorporated societies. Though the impugned Act
while creating the new Board gave it a corporate
status, it confined its powers and duties to
institutions
157
in Delhi and limited its rights, powers and
privileges to the purposes for which it was
created. The provisions of the impugned Act
relating to the incorporation of the new Board
fell within the first part of Entry 32 of List II.
Taff Vale Railway v. Amalgamated Society of
Railway Servants, (1900) A.C. 426 and Bonsor v.
Musicians’ Union, L.R. 1956 A.C. 104, referred to.
Krishnan v. Sundaram, (1940) 43 Bom. L.R.
562, Boppana Rukminiamma v. Maganti Venkata
Ramadas, A.I.R. 1940 Mad. 946, and M. A. Nunnier
v. Official Assignee, Madras, A.I.R. 1951 Mad. 875
and Satyavart Sidhantalankar v. The Arya Samaj,
Bombay, (1945) 48 Bom. L.R. 341, distinguished.
The Servants of India Society, Poona v. The
Charity Commissioner of Bombay, (1960) 63 Bom.
L.R. 379, approved.
Held, further, that the impugned Act did not
violate Arts. 14,19 or 31. The petitioner had
failed to show that there were other institutions
similarly situated as the petitioner and that the
petitioner had been picked out for unequal
treatment. Since the transfer of management was
made by a valid law there was no question of
violation of Art. 31 (1); and since the impugned
Act did not provide for compulsory acquisition of
property Art. 31(2), as it stood at the relevant
time, had no application. Neither the dissolved
Board nor its member had any right to hold the
property of the dissolved Board and there was no
infringement of Art. 19(1)(f) involved in the Act
vesting the property in the new Board. Under the
Societies Registration Act, the members of a
society did not acquire any beneficial interest on
the dissolution of the society; the only right
which they had was to determine as to which other
society the property should be’ given to for
management. This was not a right to property
within the meaning of Art. 19(1)(f) and the taking
away of such a right by the impugned Act did not
violate Art. 19(13(f).
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 35
(Chiranjit Lal Chowdhuri v. The Union of
India, [1950] S.C.R. 869, relied on.
State of West Bengal v. Subodh Gopal Bose,
[1954] S.C.R. 587 and Dwarkadas Shrinivas v. The
Sholapur Spinning and Weaving Co., Ltd. [1954]
S.C.R. 674, distinguished.
Held, further, that there was no question of
conflict between a law made by Parliament and a
law made by the State Legislature as the Societies
Registration Act, 1860, was not a law made by
Parliament. The State Legislature had the power
either to amend the Societies Registration Act in
respect of unincorporated societies, or to make a
law relating to a corporation provided its
activities were confined to Delhi. The Delhi State
Legislature did not transgress any of its
limitations in
158
enacting the impugned Act and no question of mala
fides of the legislature arose.
K.C. Gajapati Narayn Deo v. The State of
Orissa, [1654] S.C.R. 1. relied on.
Per, Mudholkar, J., Though the old Board
could not be regarded as a corporation as the
Societies Registration Act does not provide for
incorporation it possessed some of the attributes
of a corporation and it was a ’near corporation’
or a ’quasi corporation’. It was a legal entity.
The second part of Entry 32 of List II did not
permit a law to be made which took away from an
existing legal entity its powers such as those
conferred by the Societies Registration Act and
which destroyed the legal entity. The impugned Act
could not be supported under the first part of
Entry 32 of List II as the objects of the Board
were not limited to the Delhi State. But Entries
10 and 28 of List III permitted the State
Legislature to make a law dissolving a charitable
trust and transferring its property, rights etc.
to another institution and the impugned Act could
be sustained under these Entries.
Servants of India Society, Poona v. The
Charity Commissioner of Bombay, (1950) 63 Bom. L.
R. 397, The Taff Vale Railway Co. v. The
Amalgamated Society of Railway Servants, [1901]
A.C. 426 and Bonsor v. Musicians’’ Union, [1956]
A.C. 104, referred to.
JUDGMENT:
ORIGINAL JURISDICTION: Petition No. 96 of
1955.
Petition under Art. 32 of the Constitution of
India for enforcement of Fundamental Rights.
Purushottam Tricumdas, J. B. Dadachanji
Ravindra Narain and O. C. Mathur, for the
petitioner.
C. K. Daphtary, Solicitor-General of India,
B. R. L. Iyengar and T.M. Sen, for the
respondents.
1961. October 23. The Judgment of Sinha, C.
J., Das, Sarkar and Ayyangar, JJ., was delivered
by Das, J. Mudholkar, J., delivered a separate
Judgment.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 35
S. K. DAS, J.-This is a writ petition on
behalf of two petitioners. The first petitioner is
the Board of Trustees, Ayurvedic and Unani Tibbia
College, Delhi, through Hakim Mohammed Jamil Khan,
stated to be its properly elected Secretary. The
second petitioner is Hakim
159
Mohammad Jamil Khan himself, who states that he is
still one of the trustees or members of the said
Board. The petition was initially filed on behalf
of the first petitioner. Subsequently, an
amendment petition was moved which was allowed by
us. As a result of the amendments allowed
petitioner No. 2 was added as one of the
petitioners, and certain new grounds of attack
were added in para. 14 of the petition. To these
grounds we shall advert later.
The short facts giving rise to the petition
are these. One Hakim Mohammad Ajmal Khan was a
physician (of Unani medicine) of all-India repute.
He lived in Delhi and started a pharmaceutical
institute in the town known as Hindustani
Dawakhana in the year 1903.
He also established a medical college known
as the Tibbia College. He died in the year 1927.
But before his death, in the year 1911, he along
with certain other persons formed a society styled
Anjuman-i-Tibbia and had it registered under the
Societies Registration Act, 1860 (Act XXI of
1860). The name of the society was changed in
1915, and it became known as the Board of
Trustees, Ayurvedic and Unani Tibbia College,
Delhi. For convenience we shall refer to it as the
Board. The Board ran the Tibbia College’ and an
attached hostel. The pharmaceutical institute was
also managed by it, though at one stage petitioner
No. 2 claimed the institute as his private
property. Certain rules and regulations were made
for the functioning of the Board, which were
amended from time to time. The main objects of the
Board were thus stated in the rules :-
(a) to establish colleges for the
purpose of imparting higher education in the
Unani and Ayurvedic systems of medicine to
the inhabitants of India;
(b) to improve the indigenous systems of
medicine on scientific lines and for that
160
purpose to establish one or more
pharmaceutical institutes (dawakhanas); and
(c) to have medical books compiled and
translated and to adopt other means which
might enhance the popularity of those systems
and add to the information of the people in
general on hygiene etc.
The maximum number of members (called
trustees in the rule) was 35 to be elected from
all the then Provinces of India. It was stated in
r. 5 that one-third of the members of the Board
should be Hakims and Vaids. The financial year of
the Board was to be from April 1 to March 31 of
each year, and the annual subscription to be paid
by a member of the Board was fixed at Rs. 12/- per
annum payable in advance before April 30 of each
year. Rule 6 laid down the circumstances in which
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 35
the office of a member should be deemed to be
vacant, and one of such circumstances was the
failure of a member to pay him annual subscription
before the date fixed for such payment. There were
also rules regarding (a) power of inspection of
the college, hostel etc., (b) ordinary meetings of
the Board of Trustees and (c) matters which could
be dealt with by the Board and its sub-committees.
It is not necessary to state these rules in
detail. Rule 13 provided for the formation of a
Managing Committee consisting of nine members and
six officials for a period of three years and the
functions of the Managing Committee were also
prescribed in the rules. The office-bearers of the
Board and the Managing Committee were to be the
same and consisted of (1) a President, (ii) a
Senior Vice-President, (iii) a Junior Vice
President, (iv) a Secretary, (v) a Financial
Secretary, and (vi) a Joint Secretary. It was laid
down in r. 26 that the office-bearers of the Board
were to be elected for three years by the members.
The rules also laid down the powers and duties of
the President,
161
Secretary, Financial Secretary and Joint
Secretary. One of the rules said that the office
of the Secretary of the Board shall, as far as
possible, vest in the lineal descendants of Hakim
Mohammad Ajmal Khan. Hakim Mohammad Jamil Khan son
of Hakim Mohammad Ajmal Khan and petitioner no. 2
before us, was the first Secretary of the Board.
In the year 1948 Shri Rameshwar Dayal, the
then Collector of Delhi, and Dr. Yudhvir Singh the
then President of the Delhi Municipal Committee,
and certain other persons were elected as members
of the Board. Dr. Yudhvir Singh was elected
President and one Shri Mool Chand Gagerna was
appointed Joint Secretary. Soon after the
elections in 1948, a struggle ensued between
different groups of members for obtaining control
of the Board and the college, and for possession
of the Hindustani Dawakhana. Certain criminal
proceedings followed. On October 18, 1949, a suit
was brought in the court of the senior Subordinate
Judge, Delhi under H. 92 of the Code of Civil
Procedure against the Secretary and 31 members of
the Board. In that suit an application was made
for the appointment of a receiver and on October
19, 1949, the Subordinate Judge appointed two
local advocate as joint receivers with plenary
powers. These receivers took possession of the
Dawakhana and the college between October 19 and
23, 1949. When the suit was still pending, the
Delhi State Legislature passed an Act called the
Tibbia College Act, 1952 (Delhi Act No. 5 of
1952), hereinafter referred to as the impugned
Act. This Act same into fore on October 10, 1952.
The constitutional validity of the Act is the
principal question for decision on this writ
petition and we shall presently refer to the
provisions thereof. We may only state here that by
s. 9 of the impugned Act, the Board stood
dissolved and all property, movable and immovable,
and all rights, powers and privileges
162
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 35
of the Board vested in a new Board constituted
under the Act. This new Board is called the Tibia
Delhi College Board and we shall Refer to it as
the new Board. After the passing of the impugned
Act, the suit instituted before the Subordinate
Judge, the Delhi was withdrawn. On the withdrawal
of the suit, an application was made for making
over possession of the properties to the new
Board. That application was allowed in spite of
the objection of petitioner no. 1. Petitioner no.
1 unsuccessfully moved the High Court of Punjab
against that order.
Thereafter, petitioner no. 1 moved this Court
under Art. 32 of the Constitution for the issue of
a writ restraining the State of Delhi and the
newly constituted Board under the impugned Act,
the State from enforcing the provisions of the
impugned Act and the new Board from exercising any
functions thereunder. The respondents to the
petition raised a number of preliminary
objections, and on December 13, 1954, the writ
petition was withdrawn. This was followed by some
amendments of the rules of the Board and it is
stated on behalf of the petitioners that a fresh
election was held in accordance with the amended
rules on January 6, 1955. On January 11, 1955, the
Managing Committee passed a resolution authorising
the Secretary to institute a proceeding in this
Court to enforce the fundamental rights of
petitioner no. 1. The present petition was then
filed on March 14, 1955, in pursuance of that
resolution. The petition was subsequently amended
in the manner already indicated by us. The State
of Delhi and the new Board are the respondents to
the present petition.
The learned Advocate for the petitioners has
challenged the validity of the Act on two main
grounds. His first ground that the Delhi State
Legislature had no legislative power or competence
to enact the impugned Act, which must on that
ground be declared invalid and inoperative. The
second ground proceeds on the footing that
assuming
163
the Delhi State Legislature had power to enact the
impugned Act, the Act is bad because its several
provisions violate the fundamental rights
guaranteed to the petitioners under Art. 14, 19
and 31 of the Constitution. Two subsidiary points
have also been urged before us, one to the effect
that the Delhi State Legislature could not by the
impugned Act over-ride the provisions of the
Societies Registration Act, 1860 which is a
Central Act, and the other to the effect that the
Delhi State Legislature acted mala fide in passing
the impugned Act.
We shall presently deal with these arguments
in the order in which we have stated them. It is
necessary to state here, however, that a
preliminary objection similar to the one urged
against the previous petition was also urged in
respect of the present petition. The learned
Solicitor General appearing on behalf of the
respondents has urged that by reason of the
failure of the members to pay the annual
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 35
subscription in time, all of them ceased to be
members in 1950-1951; therefore, the elections
held in 1955 were of no effect there being no one
competent to elect; and the Board as a Board
ceased to exist before 1955 and neither petitioner
no. 1 nor petitioner no. 2 could maintain the
present writ petition. Some of the affidavits made
on behalf of the parties containing averments with
regard to the payment or non-payment of
subscription particularly in the years 1949-50 and
1950-51 were read, and Ex. B. series which were
the cash books of the years 1951 to 1954 were also
placed before us. On one side there is the
averment on behalf of the respondents that no
subscriptions were paid before the due date for
the years 1949-50 and 1950-51 by any of the
members. As against this, it is stated on behalf
of the petitioners that petitioner no. 2 and some
of the other members paid their subscription to
the Financial Secretary for the years 1949-50 and
1950-51. An affidavit made by the then Financial
Secretary was also placed before us. From appeal
of the affidavits
164
and the documents filed it appeared to us that the
. question being one of disputed facts could not
be satisfactorily decided on the materials placed
before us. us. We, therefore, thought it proper
and convenient to consider the legal points urged
as regards the constitutional validity of the
impugned Act and of the action taken thereon.
Now, we take up the first argument advanced
on behalf of the petitioners. This argument has
been put in the following way. The State of Delhi
became a Part State on the coming into force of
the Constitution of India. Under Art. 239 of the
Constitution as it then stood, a Part State was to
be administered by the President acting, to such
extent as he thought fit, through a Chief
Commissioner or a Lieutenant-Governor to be
appointed by him or throughout the Government of a
neighbouring State. Article 240 of the
constitution enabled Parliament by law to create
or continue for any Part State a body, whether
nominated, elected or partly nominated and partly
elected, to function as a Legislature for the
State. By virtue of the power conferred by Art.
240, Parliament enacted the Government of Part a
States Act, 1951 (Central Act 49 of 1951), by
which a Legislative Assembly was constituted for
some of the Part C States including one for Delhi.
Section 21 of the said Act laid down the extent of
legislative power of the Legislative Assembly.
This section said inter alia that the Legislative
Assembly of a Part a State may make laws for the
whole or any part of the State with respect to any
of the matters enumerated in the State List (List
II) or in the Concurrent List (List III). There
was an exception provided with regard to the
Legislative Assembly of the State of Delhi in
respect of public order, police etc., which is not
relevant for our purpose. Section 22 said that if
any provision of a law made by the Legislative
Assembly of 0, Part State was repugnant to any
provision of a law made by Parliament, then the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 35
165
law made by Parliament, whether passed before or
after the law made by the Legislative Assembly of
the State, shall prevail and the law made by the
Legislative Assembly of the State shall, to the
extent of the repugnancy, be void. There is an
Explanation to the section which is not ’relevant
for our purpose and need not be read. The point
which the learned Advocate for the petitioners has
emphasised is that under s. 21 aforesaid, the
extent of the legislative power of the Delhi State
Legislature was limited to the making of laws for
the whole or any part of the Delhi State with
respect to any of the matters enumerated in the
State List or in the Concurrent List of the
Seventh Schedule to the Constitution. Now, item 32
of the State List (List II) is in these terms:
"32. In corporation, regulation and
winding up of corporations, other than those
specified in List I. and universities,
unincorporated trading, literary, scientific,
religious and other societies and
associations; co-operative societies."
Items 43 and 44 of the Union List (List I) are in
these terms:
43. Incorporation, regulation and
winding up of corporations, including
banking, insurance and financial corporations
but not including co-operative societies
44. Incorporation, regulation and
winding up of corporations, whether trading
or not, with objects not confined to one
State, but not including universities."
The argument of the learned Advocate for the
petitioners is this. The old Board which was
registered under the Societies Registration Act,
1860 and is petitioner no. 1 before us, was a
corporation, whose objects were not confined to
the State of Delhi. Therefore, any legislation
with regard to it could fall under item 44 of List
1 and not under
166
item 32 of List II. This argument consists of two
parts-first, that the old Board was a corporation,
and, secondly, that its objects were not confined
to one State. The learned Advocate urge that being
the position, the Delhi State Legislature had no
legislative competence to make the impugned
legislation which went beyond the extent of its
legislative power under 8. 21 of Act 49 of 1951.
It is worthy of note here that if the Board were
not a corporation, then the impugned legislation
would not fall under item 44 of List I;
alternatively, if the Board were not a
corporation but its objects were confined to only
one State, viz. the State of Delhi, then again
item 44 would not be attracted. On behalf of the
respondent there is a threefold reply to the
argument stated above: firstly, that the Board was
not a corporation; secondly, its objects did not
extend beyond the State of Delhi; and thirdly, the
impugned legislation is supportable under item 11
of List II relating to "Education" and item 28 of
the Concurrent List (List III) relating to
"Charities and charitable institution".
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 35
The first and foremost question is whether
the old Board was a corporation in the legal
sense of that word. What is a Corporation?
Corporations may be divided into two main classes,
namely, corporations aggregate and corporations
sole. We are not concerned in the present case
with Corporation sole. A corporation aggregate has
been defined as a collection of individuals united
into one body under a special denomination, having
perpetual succession under an artificial form, and
vested by the policy of the law with the capacity
of acting in several respects as an individual,
particularly of taking and granting property, of
contracting obligations and of suing and being
sued, of enjoying privileges and immunities in
common, and of exercising a variety of political
rights, more or less extensive, according to the
design of its institution, or the powers conferred
upon it, either at the time of its creation or at
any subsequent
167
period of its existence". (Halsbury’s Laws of
England, 3rd Edn. Vol. 9, page 4.) A corporation
aggregate has therefore only one capacity, namely,
its corporate capacity. A corporation aggregate
may be a trading corporation ora non-trading
corporation. The usual examples of a trading
corporation are (1) charter companies, (2)
companies incorporated by special acts of
parliament, (3) companies registered under the
Companies Act, etc. Non-trading corporations are
illustrated by (1) municipal corporations, (2)
district boards, (3) benevolent institutions, (4)
universities etc. An essential element in the
legal conception of a corporation is that its
identity is continuous, that is, that the original
member or members and his or their successors are
once In law the individual corporators, or
members, of which it is composed are something
wholly different from the corporation itself; for
a corporation is a legal persona just as much as
an individual. Thus, it has been held that a name
is essential to a corporation; that a corporation
aggregate can, as a general rule, only act or
express its will by deed under its common seal;
that at the present day in England a corporation
is created by one or other of two methods, namely,
by Royal charter of incorporation from the Crown
or by the authority of Parliament that is to say,
by or by virtue of statute. There is authority of
long standing for saying that the essence of a
corporation consists in (1) lawful authority of
incorporation, (2) the persons to be incorporated,
(3) a name by which tho persons are incorporated,
(4) a place, and (5) words sufficient in law to
show incorporation. No particular words are
necessary for the creation of a corporation; any
expression showing an intention to incorporate
will be sufficient.
The learned Advocate for the petitioners has
referred us to various provisions of the Societies
Registration Act, 1860 and has contended that the
168
result of these provisions was to make the Board a
corporation on registration. It is necessary now
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 35
to read some of the provisions of that Act. The
Act is entitled an Act for the registration of
literary, scientific and charitable societies and
the preamble states that it was enacted for
improving the legal condition of societies
established for the promotion of literature,
science, or the fine arts, or for the diffusion of
useful knowledge etc., or for charitable purposes.
Section 1 of the Act states that any seven or more
persons associated for any literary, scientific,
or charitable purpose, or for any such purpose as
is described in s.20 of the Act may, by
subscribing their names to a memorandum of
association and filing the same with the Registrar
of Joint-stock Companies form themselves into a
society under the Act. Section 2 lays down that
the memorandum of association shall contain and
one of the particulars it must contain is "the
objects of the society". Section 3 deals with
registration and the fees payable therefor.
Sections 5 and 6 are important for our purpose and
should be read in full.
5. The property, movable and immovable,
belonging to a society registered under this
Act, if not vested in trustees, shall be
deemed to be vested, for the time being, in
the governing body of such society, and in
all proceedings, civil and criminal, may be
described as the property of the governing
body of such society by their proper title.
"6. Every society registered under this
Act may sue or be sued in the name of the
president, chairman, or principal secretary,
or trustee, as shall be determined by the
rules and regulations of the society, and, in
default of such determination, in the name of
Such person as shall be appointed by the
governing body for the occasion:
169
Provided that it shall be competent for
any person having a claim or demand against
the society, to sue the president or
chairman, or principal secretary of the
trustees thereof, if on an application to the
governing body some other officer or person
be not nominated to be the defendant."
Section 7 provides for non-abatement of suits or
proceedings and the continuance of such suite or
proceedings in the name of or against the
successor of the person by or against whom the
suit was brought. Section 8 says that if a
judgment is recovered against a person or officer
named on behalf of the society such judgment shall
not be put in force against the property, movable
or immovable, or against the body of such person
or officer, but against the property of the
society. Section 10 provides that in certain
circumstances mentioned therein a member of the
society may be sued by the society; but if the
defendant shall be successful in any such suit
brought at the instance of the society and shall
be adjudged to recover his costs, he may elect to
proceed to recover the same from the officer in
whose name the suit was brought, or from the
society. Sections 13 and 14 provide for
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 35
dissolution of societies and the consequences of
such dissolution. These provisions have also an
important bearing on the questions before us and
are quoted in full.
13. Any number not less than three-
fifths of the members of any society may
determine that it shall be dissolved, and
thereupon it shall be dissolved forthwith, or
at the time then agreed upon, and all
necessary steps shall be taken for the
disposal and settlement of the property of
the society, its claims and liabilities,
according to the rules o the said society
applicable thereto, if any, and, if not then
as the governing body shall find expedient,
provided that, in the event of any
170
dispute arising among tho said governing body
or the members of the society, the adjustment
of its affairs shall be referred to the
principal court of original civil
jurisdiction of the district in which the
chief building of the society is situate, and
the Court shall make such order in the matter
as it shall deem requisite:
Provided that no society shall be
dissolved unless three-fifths of the members
shall have expressed a wish for such
dissolution by their votes delivered in
person, or by proxy, at a general meeting
convened for the purpose:
Provided that whenever any Government is
a member of, or a contributor to, or
otherwise interested in any society
registered under this Act, such society shall
not be dissolved, without the consent of the
Government of the state of registration.
14. If upon the dissolution of any
society registered under this Act there shall
remain, after the satisfaction of all its
debts and liabilities, any property
whatsoever, the same shall not be paid to or
distributed among the members of the said
society or any of them, but shall be given to
some other society, to be determined by the
votes of not less than three-fifths of the
members present personally or by proxy at the
time of the dissolution, or, in default
thereof, by such Court as aforesaid:
Provided, however, that this clause
Shall not apply to any society which shall
have been founded or established by the
contributions of shareholders in the nature
of a Joint Stock Company."
Now, the question before us is regard being
had to the aforesaid provisions-was the Board a
corporation? Our conclusion is that it was not.
The most important point to be noticed in this
connection is that in the various provisions of
the
171
Societies Registration Act, 1860, there are no
sufficient words to indicate an intention to
incorporate, on the contrary, the Provisions show
that there all absence of such intention.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 35
Section 2 no doubt provides for a name as also
for the objects of the society. Section 5, however
states that the property belonging to the society,
if not vested in trustees, shall be deemed to be
vested in the governing body of the society and in
all proceedings, civil and criminal, the property
will be described as the property of the governing
body. The section talks of property belonging to
the society; but the property is vested in the
trustees or in the governing body for the time
being. The expression property belonging to the
society" does not give the society a corporate
status in the matter of holding or acquiring
property, it merely describes the property which
vests in the trustees or governing body for the
time being. Section 6 gives the society the right
to sue or be sued in the Name of the president,
chairman etc. and 8. 7 provides that no suit or
proceeding in a civil court shall abate by reason
of the death etc of the person by or against whom
the suit has been brought. Section 8 again says
that any judgment obtained in a suit brought by or
against the society shall be enforced against it.
It has been submitted before that 88. 6, 7 and 8
clothe the society with a legal personality and a
perpetual succession; and s. 10 enables the
members of the society to be sued as strangers
certain circumstances, by the society, and the
Costs awarded to the defendant in such a suit
may be recovered, at his election, from the
officer in whose name the suit was brought.
Dealing with very similar provisions (ss. 7. 8
and) of the English Trade Union Act, 1871 (34 and
35 Vict, . 31) Lord Lindley said in the
celebrated case of Taff Vale Railway v.
Amalgamated Society of Railway Servants (1).
(1) [1901] A. C. 426.
172
The Act does not in express terms say
what use is to be made of the name under
which the trade union is registered and by
which it is known. But a trade union which is
registered under the Act must have a name
...... It may acquire property, but, not
being incorporated, recourse is had to the
old well-known machinery of trustees for
acquiring and holding such property, and for
suing and being sued in respect of it (ss.7,
8,9). The property so held is, however, the
property of the union; the union is the
beneficial owner. ...... The Act appears to
me to indicate with sufficient clearness that
the registered name is one which may be used
to denote the union as an unincorporated
society in legal proceedings as well as for
business and other purposes."
In Trade Union Law’ by N. A. Citrine (1950 edn.)
to which the learned Advocate for the petitioners
has referred, it is stated at p. 143:
The object of this section (s. 9) was to
provide a method of enabling legal
proceedings to be brought in respect of the
property of a registered trade union. Since
the legislature had no intention of giving
such unions corporate status with power to
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 35
hold property and to sue and be sued in their
registered names, it was necessary to provide
for the vesting of their property in trustees
and to permit them to bring or defend legal
proceedings in respect of that property on
the unions behalf. section 8 of this Act,
having provided for the vesting of the
union’s property in its trustees, the present
section supplements that section by
empowering the trustees to bring or defend,
on the union’s behalf, civil or criminal
proceedings concerning its property."
In Bonsor v. Musicians’ Union(1) the position
(1) (L. R.) 1956 A. C. 104.
173
Of a registered trade union in England came under
consideration of the House of Lords in an appeal
from the Court of Appeal. On a review of earlier
decision including the decision in Tuff Vale
Railway v. Amalgamated Society of Railway
Servants(1), Lord Macdermott, Lord Keith of
Avenholm and Lord Somervell of Harrow held that a
registered trade union was not juristic person
distinguishable at any at any moment of time from
the members of which it was composed. After
referring to the various provisions of the Trade
Union Act 1871 and some of the earlier decision
bearing on the question Lord MacDermott said: ’
"I base this opinion primarily on the
statutes. The more closely they are examined
the clearer it seems to be that the
legislature, though minded to bestow upon
registered unions some of the gifts and
attributes of legal personality, had no
intention of doing more and was, indeed,
adverse to the idea of going the whole length
and making those unions new creatures,
distinct in law from their membership, and
fundamentally different from the combination
of persons which the definition requires all
trade unions to be."
Lord Morton of Henryton and Lord Porter, who
expressed the minority view, held that a
registered trade union though not an incorporated
body, was yet capable of entering into contracts
and of being sued as a legal entity, distinct from
its individual members.
It is clear from the aforesaid decisions that
provisions similar to the previsions of ss. 5, 6,
7 and 8 of the Societies Registration Act, 1860
were held not to show any intention to
incorporate; on the contrary, the very resort to
the machinery of trustees or the governing body
for the time being acquiring and holding the
property showed that there was no intention to
incorporate the society or
(1) [1901] A. C. 426.
174
union of as to give it a corporate capacity for
the purpose of holding and acquiring property.
It , appears to us that the legal position is
exactly the same with regard to the provisions
in ss. 6, 6, 7 and 8 of the Societies
Registration Act, 1860. They do J not show any
intention to incorporate, though they confer
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 14 of 35
certain privileges on a registered society, which
would be wholly unnecessary if the registered
society were a corporation. Sections 13 and 14 do
not carry the matter any further in favour of the
petitioners. Section 13 provides for dissolution
of societies and adjustment of their affairs. It
says in effect that on dissolution of a society
necessary steps shall be taken for the disposal
and settlement of the property of the society, its
claims and liabilities, according to the rules of
the society; if there be no rules, then as the
governing body shall find it expedient provided
that in the event of any dispute arising among the
said governing body or the members of the said
society, the adjustment of the affairs shall be
referred to the Court. Here again the governing
body is given a legal power somewhat distinct from
that of the society itself; because under s.16 the
governing body shall be the governors, council,
directors, committee, trustees or other body to
whom by the rules and regulations of the society
the management of its affairs is entrusted.
We have, therefore, come to the conclusion
that the provisions aforesaid do not establish the
main essential characteristic of a corporation
aggregate, namely, that of an intention to
incorporate the society. We may further observe
that the scheme and provisions of the Societies
Registration Act,1860 are very similar to those of
the Friendly Societies Act, 1986 (59 and 69 Vict.
0.25), as amended in certain respects by
subsequent enactments. It is appropriate to quote
here what Dennis Lloyd has said in his ’Law
relating to Unincorporated Association’ (1938
edn.) at page 59 in respect of the
175
provisions of the Friendly Societies Act, 1896 as
modified by subsequent enactments. He has said:
The modern legislation still maintains
the policy of the older Acts in withholding
corporate status from friendly societies.
Registration does not result in
incorporation, but merely entitles the
society so registered to enjoy the privileges
conferred by the Act. These privileges are of
considerable importance and certain of them
go a long way toward giving registered
societies.. a status in many respects
analogous to a corporation strictly so-
called, but without being technically
incorporated. Thus something in the nature of
perpetual succession is conceded by the
provision that the society’s property is to
vest in the trustees for the time being of
the society for the use and benefit of the
societies and its members and of all persons
claiming through the members according to the
society’s rules, and further (and this is the
most noteworthy provision) that the property
shall pass to succeeding trustees without
assignment or transfer. In the same way,
though the society, being unincorporated, is
unable to sue and be sued in its own name, it
is given the statutory privilege of suing and
being sued in the name of its trustees."
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 15 of 35
We think that these observations made with regard
to similar provisions of the Friendly Societies
Act, correctly and succinctly summarise the legal
position in respect of the several provisions of
the Societies Registration Act, 1860. Those
provisions undoubtedly give certain privileges to
a society registered under that Act and the
privileges are of considerable importance and some
of those privileges are analogous to the
privileges enjoyed by a corporation, but there is
really no incorporation in the sense in which that
word is legally understood.
176
On behalf of the petitioners reliance has
been placed on the decision in Krishnan v.
Sundaram (1) where Kania, J., (as he then was)
said:
The position of a society registered
under the Societies Registration Act, 1860 is
like that of a club or a joint stock
company."
There was no discussion of the question of
incorporation, and the decision cannot be accepted
as authoritatively laying down that a society
registered under the Societies Registration, Act
is a corporation. There was a similar observation
without any discussion in Boppana Rukminamma v.
Maganti Venkata Ramadas(2) and N. A. Nannier v.
Official Assignee, Madras (3). There is how-ever,
a fairly full discussion of the question in
Satyavart Sidhantalankar v. The Arya Samaj, Bombay
(4) where Bhagwati, J., held that a Society
registered under the Societies, Registration Act,
1860 was a legal entity apart from the members
constituting it, and it can sue and be sued in its
own name. The question which fell for decision in
that case was not whether a society registered
under the Societies Registration Act was
’incorporated’ as that term is legally understood.
The question there was whether such a society
could sue or be sued accept in the manner provided
by 6 and 7. It was held that it could and the
reason given was thus expressed by the learned
Judge: "
I am of opinion that the provisions
contained in ss. 6, 7 and 8 of the Societies
Registration Act are not inconsistent with
the user of the registered name of the
society in connection with legal proceedings.
As Lord Lindley observed in Taffy Vale
Railway Company‘s case (supra), "I do not say
that the use of the name is compulsory but it
is at least permissive."
If this is the true legal position of a
society registered under the Societies
Registration
(1) (140)43 Bom L.R. 56 (2) A.I.R. 1940
Mad. 949.
(3) A. I. R.1951 Mad.875. (4) (1945) 48
Bom. L. R. 941.
177
Act, the objection .. that the plaintiffs
and the defendants are one and the same and
that the suit as framed is not maintainable
by reason of the society being the plaintiffs
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 16 of 35
as well as the defendants disappears. The
plaintiffs are suing on behalf of themselves
and all the members of the society. The First
defendant is the president of the society and
represents the society. As I have already
observed the society on its registration with
the Registrar of Joint Stock Companies
becomes a legal entity apart from its
members; it would be therefore idle to
contend that the society arc the plaintiffs
as well as the first defendant in this
action’
It is unnecessary for use to consider the
correctness or otherwise of the reason given; it
is sufficient for use to state that we do not
think that the decision proceeds on the footing
that a society registered under the Societies
Registration Act is a corporation in the sense of
being incorporated as that term is legally
understood, but if it does, we are unable to
accept it as correct."
The precise question which has arisen before
US arose in Servants of India Society, Poona v.
The Charity Commissioner of Bombay ). The facts of
that case were these. The "Servants of India
Society" was an institution which was registered
under the Societies Registration Act, 1860. It
owned considerable movable and immovable property
both in the State of Bombay as well as in other
parts of India. The State of Bombay issued a
notification under a 1(4) of the Bombay Public
Trusts Act, 1950 (Bom. Act XXIX of 1950) which
applied the provisions of that Act to a society
formed for religious or charitable purposes and
registered under the Societies Registration Act.
An application was made under 8.18(1) of the
Bombay Public trusts Act 1950 for registration of
the Servants of India Society. During an enquiry
into
(1) (1960) 63 Bom. L. R. 379;
178
that application an objection was taken that the
Servants of India Society having been registered
under the Societies Registration Act was a
corporation and had objects also outside the
Bombay State and therefore, a legislation
purporting to regulate the activities of such a
society fell in entry 44 of List I and
consequently the State Legislature had no power to
make any law to regulate the affairs of such a
society. This objection was dealt with first by
the Assistant Charity Commissioner and then the
Charity Commissioner; thereafter, an application
Was made under 8. 72 of the Bombay Public Trusts
Act, 1950 to the Court of the District Judge,
Poona. Then the matter was taken to the High Court
on appeal from the decision of the District Judge.
The appeal came up for hearing before our learned
brother Mudholkar, J. (who was then a Judge of the
Bombay High Court) and Patel, J. After referring
to several decision including the decision of
Bhagwati, J. in Satyavart Sidhantalankar v. The
Arya Samaj, Bombay (1) our learned brother held
that the Servant of India Society registered under
the Societies Registration Act was a legal entity
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 17 of 35
and a quasi-corporation. He further held that
entry 44 in List I and the first part of entry 32
in List II relating to incorporation, regulation
and winding up of corporations’ must be given a
liberal construction and quasi-corporations would
come under those entries. Basing himself on a
parity of reasoning relating to entry 7 in List
III which related to ’Contracts’, he said that if
quasi. contracts would come under entry 7, quasi-
corporation must also come under entries 43 and 44
of List I and the first part of entry 32 of List
II. mr.. Justice Patel took a different view. He
said:
A reference to entry 32 of the State
List shows that, incorporation regulation and
winding up of corporation, other than those
specified in List I (Union List, entries 43
regulation and
(1) (1945) 48 Bom. L. R. 341.
179
44), and universities are expected from Union
List. Further "unincorporated trading,
literary, Scientific, religious and other
Societies and associations" and "co-operative
societies" are also excepted from the Union
List. The emphasis would appear to be on the
word unincorporated ’ used in connection with
"trading, literary, scientific, religious and
other societies and associations". If an
association or society is unincorporated,
then it may not fall within the Union List.
The question, therefore, that is pertinent to
be decided is not whether or not an
association or a society is a legal entity
or a quasi-corporation, but whether it is
incorporated or unincorporated. If this is
borne in mind, then it is amply clear that
entries 43 and 44 of the Union List would
cover only those societies and associations
which are incorporated; and those which may
have legal entity but which are not
incorporated will not fall within the Union
List."
The matter was then referred to a third Judge
(Gokhale, J.) who thus expressed his view:
In my judgment, societies registered
under the societies Registration Act are
neither corporations nor quasi-corporations,
but are unincorporated societies contemplated
under the second part of entry 32 of the
State List."
Mr. Justice Gokhale also expressed the view that
when Considering the ambit of an express
legislative power in relation to an unspecified
residuary power, abroad interpretation must be
given to the former; the case, however, is
different where under the Constitution there are
two complementary powers each expressed in precise
and definite terms and in such a case there is no
justification for giving a broader interpretation
one power rather than to the other. We find
ourselves in agreement with
180
this view. It seems clear to use that entries 43
and 44 of list I when they talk of incorporation,
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 18 of 35
regulation and winding up of corporations
relate to such legal entities as have been
incorporated and are corporations in the full
sense of the term. Similarly,the first part of
entry 32 of List II when it talks of
"incorporation, regulation and winding up of
corporation’‘ relates to such legal entities as
are incorporated. This is further clarified by the
second part of entry 32 which talks of
"unincorporated trading. literary, scientific,
religious and other societies and association". In
entry 32 there is a dichotomy in the two parts
thereof: the first part relates to incorporated
societies which are corporations in the true sense
of that term, and the second part relates to
unincorporated societies. The justification is
between incorporated societies and unincorporated
societies and there can be no doubt as to which of
the two parts in which a society registered under
the Societies Registration Act, 1860 will fall, be
it called a quasi-corporation or by any other
name. A society registered under the Societies
Registration Act may have characteristics which
are analogies to some of the characteristics of
a corporation; yet it is not incorporated and
remains an unincorporated society. AS soon as it
is held that it is an unincorporated society, it
must come under the second Part of entry 32 of
List II.
In this view of the matter it is unnecessary
to decide the further questions as to (1) whether
the objects of the old Board extended beyond the
State of Delhi, and (2) if other entries such as
entry 11 of List II and entry 28 of List III can
support the impugned legislation. We may, however,
observe that if we had come to a different
conclusion on the question whether the old Board
was a corporation or not and it became necessary
to decide question no. (1) above, we might have
held that in view of the rules governing the old
Board, its objects were not confined to the State
of Delhi only in the sense
181
that it would not have been ultra vires of the old
Board to have started colleges etc., outside the
State of Delhi. We should however, add that the
activities of the old Board did not, as a matter
of fact, extend beyond the State of Delhi on the
(late when the impugned Act was enacted.
There is another aspect of the question which
has to be considered here. Section 3 of the
impugned Act is in these terms:
3. (1) With effect from such date as the
Chief Commissioner may, by notification in
the official Gazette, appoint (hereinafter
referred to in this Act as "the appointed
day"), the entire management and control of
the Ayurvedic and Unani Tibbi College, Delhi
now vested in the Board of Trustee of the
Ayurvedic and Unani Tibbi College, Delhi,
shall be vested in a Board to be called the
Tibbia College Board".
(2) The Board shall be a body corporate
having perpetual succession and a common seal
and shall by the said name sue and be sued."
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 19 of 35
Sub-section (2) of 8. 3 says in express terms that
the new Board constituted under the impugned Act
is given a corporate status; in other words, the
new Board is a corporation in the full sense of
the term Does the impugned legislation still come
within entry 32 of List II . We think it does and
for these reasons. We have held that the old Board
was not a corporation, even though it was
registered under the Societies Registration Act.
When, therefore, the Delhi State Legislature
passed a law dissolving the old Board, it was
really dealing with an unincorporated society or
association By the impugned legislation, however,
it gave the new Board a corporate status, but at
the same time so delimited the powers and duties
of the new Board as to confine them to the State
of Delhi
182
only. The impugned Act is entitled an Act to
provide for transfer of the management of the
Ayurvedic and Unani Tibbi College, Delhi, founded
by the late Hakim Ajmal Khan from its present
trustees to a Board." In other words, the Act
deals only with the college in Delhi and the
pharmaceutical institute attached to it. Section 7
which gives the powers and duties of the new Board
is in these terms:
7. The Board shall exercise the
following powers and perform the following
duties, namely:-
(a) to maintain the Ayurvedic and Unani
Tibbi College, Delhi with a view to impart
higher eduction to men and women in the
Ayurvedic and Unani Systems of Medicine and
to promote and conduct research in the same:
(b) to maintain and improve the
Hindustani Dawa Khana and Rasayanashala;
(c) to provide for studies to enable
incorporation, where necessary of the
principle of the modern system of Medicine
and surgery in order to help the scheme of
studies for the Ayurvedic and Unani systems
according to the exigencies of time;
(d) to help produce and publish books in
order to facilitate the carrying out of the
objects specified in the clauses (a) to (c);
(e) to receive gifts, donations or
benefactions from Government and to receive
bequests, donations and transfer of movable
or immovable properties from trustees, donors
or transferors, as the case may be;
(f) to deal with any property belonging
to or vested in the Board in such manner as
the Board may deem fit for advancing the
objects specified in clauses (a) to (d);
183
(g) to do all such things as may be
necessary incidental or conductive to the
attainment of all or any of the subjects
specified in clauses (a) to (d)
Unlike the rules governing the old Board which
enabled it to establish colleges outside Delhi for
the purpose of imparting higher education ill the
Unani and Ayurvedic systems of medicine, s. 7
gives the new Board powers and duties with regard
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 20 of 35
to the Ayurvedic and Unani Tibbi College at Delhi
and the pharmaceutical institute and laboratory
attached to it. This is made further clear by the
definition of the word Board’ in 8. 2,
incorporation section, namely, 8. 3, constitution
of the Board as laid down in 8. 4, and the
sections relating to the power of the chief
commissioner to supersede the Board, to make rules
to carry out the objects of the Act and the power
of the Board to make regulations not inconsistent
with the Act for carrying out the purposes
thereof. None of the provisions of the impugned
legislation accepting 8. 9 to which we shall
presently refer give the new Board any powers or
duties other than those connected with the
college, attached pharmaceutical institute and
laboratory, all situate in the State of Delhi. We
now come to 8. 9 which is in these terms:
"9.(1) As from the appointed day, the
Board of Trustees of the Ayurvedic and Unani
Tibbi College, Delhi, a society registered
under the provisions of the Registration of
Societies Act, 1860, on the 12th day of
August, 1911, by the name Anjuman-i -Tibbia
whose purpose, Constitution and name was
amended on 25th November, 1915), shall stand
dissolved and all property, movable and
immovable, and all rights, powers and
privileges of the said society which
immediately before the appointed day belonged
to or were vested in the said society shall
vest in the
184
Board and shall be applied for the purposes
for which the Board is constituted.
(2) As from the appointed day all debts
and liabilities of the said society shall
stand transferred and attached to the Board
and thereafter be discharged and
satisfied by the Board.
(3)Any will deed or other document
whether made or executed before or
after the commencement of this Act, which
contains any bequests gifts, or trust in
favour of the society shall as from the
appointed day, be construed as if the Board
were therein named instead of the Society."
It no doubt says that all rights, powers and
privileges which immediately before the
appointed day belonged to or were vested in the
old Board shall vest in the new Board; but it adds
that those rights, powers and privileges shall be
applicable for the purposes for which the new
Board is constituted. We must, therefore, read B.
9 as being subject to the provisions of 7 of
the Act. In terms 9 says that the rights,
powers and privileges of the old Board shall be
available to the new Board and shall be applied
for the purposes for which the new Board is
constituted . The words underlined are important,
and show clearly enough that the right, powers and
privileges of tho old board are available to the
new for a limited purpose only, namely, for the
purposes for which the new Board is constituted.
If the purposes for which the now Board is
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 21 of 35
constituted are confined to the institutions in
Delhi, then obviously the objects for which the
new Board is incorporated do not extend beyond the
State of Delhi.
The conclusions at which we have arrived may
now be summarised as follows:
(1) On registration under tho Societies
Registration Act, the old Board did not
185
become a corporation is the sense of being
incorporated within the meaning entry 44 of List
I; it remained and hoodwinked to be an
unincorporated society though under the several
provisions of the Societies Registration Act, 1860
it had certain privileges, some of the privileges
being analogous to those of corporation;
(2) the impugned legislation while creating
the new Board has given it a corporate statue, but
has confined its powers and duties to the college,
pharmaceutical institute and laboratory in Delhi
and while giving the new Board rights, powers and
privileges of the old Board has limited them to
such purposes for which the new Board is
constituted;
(3) the impugned legislation therefore,
falls under entry 32 of List II; so far as the
dissolution of the old Board is concerned, under
the second part of the entry and so far as
incorporation of the new Board is concerned, under
its first part.
That being the position, the impugned
legislation was well within the legislative
competence and power of the Delhi State
Legislature. We must, therefore, overrule the
first ground of attack urged on behalf of the
petitioners.
We now proceed to a consideration of the
second ground of attack. So far as the alleged
violation of Art. 14 is concerned, The petitioners
have stated in their petition:
"There are various other institutions
where there have been actual allegations of
mismanagement but the State has picked out
the petitioner. Assuming, without admitting,
that there has been mismanagement by the
petitioner of its affairs, there is not the
slightest suggestion in the whole Act that it
is promulgated on the ground of any
mismanagement on the part of the petitioner.
............ The said Act is an arbitrary
piece of legislation and There is no
reasonable
186
Classification whatsoever on which it can be
supported."
To this the reply of the respondents is that the
old Board was grossly mismanaging its affairs
they said.
"Before the said Act was passed, there
was a great deal of discontent among the
students of the said institution and also the
general public and there was strong agitation
against cross mismanagement by the trustees
of the said Board. That owing to the gross
mismanagement of the Board’s affairs by the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 22 of 35
trustees the situation had so deteriorated
that early in 1949 there were constant
students’ strikes, defalcation of funds and
frequent interruption in work and studies of
the institution."
In our view the petitioners have not made out any
basis for the contention that (1) there were other
institutions similarly situated, and (2)
petitioner No. 1 was picked out for unequal
treatment. The names of no other institutions
similarly situated have been disclosed. In the
first Sholapur case Chiranjit Lal Chowdhuri, v.
The Union of India (1) it was held by a majority
of Judges of this court that even one corporation,
(in our case one society) or a group of persons
can be taken as a class by itself for the purpose
of legislation, provided it exhibits some
exceptional features which are not possessed by
others.
The courts should prima facie lean in
favour . Of constitutionality and should
support the legislation if it is possible to
do so on any reasonable ground, and it is for
the party who attacks the validity of the
legislation to place all materials before the
court which would go to show that the
selection is arbitrary and unsupportable.
Throwing out of vague hints that there may be
other
(1) [1950] S. C. R. 869, 915, 914.
187
Instances of similar nature is not enough for
this purpose".
(per Mukherjea, J. at pp. 913-914 of the
report. These observations apply with equal force
to the present case and we are unable to sustain
the contention of the petitioners that any right
under Art. 14 of the Constitution has been
violated.
As to Art. 31 of the Constitution it seems
clear to us that cl. (2) of the said Article as it
stood at the relevant time has no application. The
impugned legislation does not relate to nor does
it provide for, compulsory acquisition of property
for a public purpose. The impugned legislation
provided for the transfer of the management of the
Ayurvedic and Unani Tibbi College, Delhi, from the
old Board to a new Board and for that purpose the
old Board was dissolved and a new Board was
created with certain rights, powers and privileges
to be applied for the exercise of powers and
performance of duties as laid down in 8. 7 of the
Act. Such legislation does not fall under Art.
31(2) and cannot be judged by the tests laid down
there in.
As to cl. (1) of Art. 31 there is no question
of any violation of that clause if the law by
which the transference of management has been made
is valid law. We have already held that the
impugned legislation was well within the
legislative competence of the Delhi State
Legislature. Now the question is the impugned
legislation bad on the ground that it violates
the right of the petitioners under Art. 19(l)(f)?
The property for the protection of which Art.
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 23 of 35
19(l)(f) is invoked belonged either to the Board
or to the members composing the Board at the date
of the dissolution. In either event, on the terms
of 8. 5 of the Societies Registration Act, 1960,
the property was to be deemed to be vested in the
governing body of the Board. There could be no
doubt that if the Board was dissolved by
188
competent legislative action, and in view of our
conclusions on the first point raised it must be
held that this had taken place the Board would
cease to exist and having ceased to exist cannot
obviously lay any claim to the property. This
however may not be sufficient to negative the
contention urged before us by the petitioners. If
the legal ownership of the property by the Board
or the vesting of it in the governing body was
merely a method or mechanism permitted by the law
whereby the members exercised their rights quoad
the property, the dissolution of the Board and
with it of the governing body thereof would merely
result in the emergence of the right of the
members to that property. It is, therefore,
necessary to ascertain the precise rights the
members of the Board possessed to see whether the
changes effected by the impugned Act amount to on
infringement of their rights within the meaning of
Art. 19(l)(f). During the subsistence of the
society, the right of the members was to ensure
that the property was utilised for the charitable
objects set out in the memorandum and these did
not include any beneficial enjoyment Nor did the
members of the Society acquire any beneficial
interest on the dissolution of the society; for 8.
14 of the Act, quoted earlier, expressly negatived
the right of the members to any distribution of
the assets of the dissolved body. In such an event
the property had to be given over to some other
society, i.e., for being managed by some other
charitable organisation and to be utilised for
like purposes, and the only right of the members
was to determine the society to whom the funds or
property might be transferred and this had to be
done by not less than three-fifths of the members
present at the meeting for the purpose and, in
default of such determination, by the civil court.
The effect of the impugned legislation is to vary
or affect this privilege of the members and to
vest the property in a new body created by it
enjoined to administer it so to serve the same
purposes as the dissolved
189
Society. The only question is whether the right to
determine the body which shall administer the
funds or property of the dissolved society which
they had under the pre-existing law is a right to
’acquire, hold and dispose of property’ within the
meaning of Art. 19(l)(f), and if so whether the
legislation is not saved by Art. 19(5). We are
clearly of the opinion that right is not a right
of property within the meaning of Art. 19(l)(f).
In the context in which the words ’to dispose of’
occur in Art. 19(l)(f), they denote that kind of
property which a citizen has a right to hold the
right to dispose of being part of or being
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 24 of 35
incidental to the right to hold Where however the
citizen has no right to hold the property, for on
the terms of 8. 14 of the Societies Registration
Act the members have no right to hold’ the
property of the dissolved society, there is, in
our opinion, no infringement of any right to
property within the meaning of Art. 19(l)(f). In
this view, the question as to whether the impugned
enactment satisfies the requirements of Art. 19(5)
does not fall to be determined.
The two decisions on which the learned
Advocate. for the petitionary has relied are the
State of West Bengal v. Subodh Gopal Bose (1) and
Dwarkadas Srinivas v. The Sholapur Spinning, &
Weaving Co. Ltd.(2). We do not think that these
decisions have any application in the present
case. In the State of West Bengal v. Subodh Gopal
Bose(1) this Court was considering a piece of
legislation which affected the right of the first
respondent therein who had purchased a particular
touzi at a revenue sale. As such purchaser he
acquired under 8. 37 of the Bengal Revenue Sales
Act, 1859, the right to avoid and annul all under-
tenures and forthwith to eject all under-tenant"
with certain exceptions. In exercise of that right
the respondent gave notices of . ejectment
and brought a suit in 1946 to evict certain
tenants. The suit was decreed. When the appeal
(1) [1954] S.C.R. 587. (2) [1954] S. C. R.
674.
190
was pending, a new legislation was made which took
away the right of the first respondent which he
had obtained by a decree of a court of law. In
these circumstances it was held that the right of
the first respondent under Art. 19(l)(f) was
violated. The facts of that case were wholly
dissimilar and the respondent‘s right there did
not depend on his being a member of a society. In
the second Sholapur case Dwarkadas Srinivas v. The
Sholapur Spinning & Weaving Co. Ltd .(1) a
Controller was appointed by Government to
supervise the affairs of the mills of a certain
company under the Essential Supplies Emergency
Powers Act, 1946. The controller made certain
requisitions which the Directors refused to comply
with. The Governor-General then made an ordinance
which was followed by an Act. Under the provisions
of the ordinance the Central Government delegated
all its powers to the Government of Bombay. The
Government of Bombay then appointed certain
Directors to take over the assets and management
of the mills. These new Directors passed a
resolution making a call of Rs. 50/- on each of
the preference Shares payable at the time stated
in the resolution. The appellant in that case was
a preference shareholder who was called upon to
pay Rs. 1,62,000/- in pursuance of the resolution
aforesaid on the preference shares where which he
held. The appellant then brought a suit
challenging the validity of the ordinance and out
of that suit appeal to this Court arose. It was
held by this Court that the impugned ordinance and
the act replacing it authorised in effect a
deprivation of the property of the company within
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 25 of 35
the meaning of Art. 31 without compensation and
violated the fundamental right of the appellant
therein as a preference shareholder, who was
called upon to pay the moneys unpaid on his
shares. The point to be noticed as distinguishing
that case from the case under our consideration is
this
(1) [1954] S. C. R. 674.
191
the Sholapur Spinning and Weaving Co. Ltd, which
was the company in that case, had not been
dissolved or brought to an end by the impugned
ordinance or the Act replacing it and the
appellant in that case continued to be a
preference shareholder; not only did he continue
to be a preference share holder but he was called
upon to pay the moneys unpaid on his shares. It is
obvious, therefore, that the appellant was
entitled to complain that by the impugned
ordinance he was being deprived of his property
without fulfilling the requirements of Art. 31 of
the Constitution. The position in the case under
our consideration is, as pointed out already,
entirely different.
In our view the impugned legislation does
not violate any fundamental right of the
petitioners under Arts. 14, 19 or 31 of the
Constitution.
This disposes of the two main grounds on
which the legislation in question has been
impugned. We now turn to the two subsidiary
points. It has been argued that some of the
provisions of the impugned Act are in conflict
with the provisions of the Societies Registration
Act 1860; therefore under s. 22 to the Government
of part a States Act, 1951 the provisions of the
impugned Act, in so far as they are repugnant to
the provisions of the Societies Registration Act,
1860, must be held to be void. The simple answer
to this argument is that 8. 22, to which we had
earlier referred in the course of this judgment,
has no application Section 22 provides for
inconsistency between laws made by Parliament (in
the sense in which the word Parliament’ is used in
the Constitution of India) and laws made by the
Legislative assembly of a Part State. The
Societies Registration Act, 1860 was not a law
made by Parliament; therefore a 22 has no
application in the present case. We have already
held, for reasons earlier given, that the Delhi
State Legislature had legislative competence or
power either to amend the
192
Societies Registration Act, 1860 in respect of
unincorporated societies, or to make a law for a
particular unincorporated society, and even to
create a new corporate body provided its objects
were confined to the State of Delhi of Delhi. In
effect the impugned legislation provides for a
disolution of the old Board which was an
unincorporated society and for the creation of a
new corporate body for the management of the
Ayurvedic and Unani Tibbi College, Delhi. In this
view of the matter, no question of any conflict
with the Societies Registration Act, 1860 arises
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 26 of 35
in this case.
It has also been argued that the impugned
legislation is a piece of colourable legislation
because the Delhi State Legislature acted mala
fide in enacting it. This argument is completely
answered by what this Court said in K. C.
Gajapathi Narayan Deo v. The State of Orissa (1).
This court said:
It may be made clear at the outset that
the dotrine of colourable legislation does
not involve any question of bona fide or male
fides on the part of the legislature. The
whole doctrine resolves itself into the
question of competency of a particular
Legislature to enact a particular law. If the
legislature is competent to pass a particular
law, the motives which impelled it to act are
really irrelevant. On the other hand. if the
legislature lacks competence, the question
motives does not arise at all If the
constitution of a State distributes the
legislative powers amongst different bodies,
which have to act within their respective
spheres marked out by specific legislative
entries, or if there are limitations on the
legislative authority in the shape of
fundamental rights, questioned do aries to
whether the legislature in a particular case
has or has not in
(1) S.C.R. 1, 10, 11.
193
respect to the subject-matter of the status
or in the method of enacting it, transgressed
the limits of its constitutional powers. Such
7 transgression may be patent, manifest or
direct, but it may also be disguised, covert
and indirect and it is to this latter class
of 7 cases that the expression "colourable
legislation" has been applied in certain
judicial pronouncements. The idea conveyed by
the expression is that although apparently a
legislature in passing a statute purported to
act within the limits of its powers, yet in
substance and in reality it transgressed
these powers, the transgression being veiled
by what appears, on proper examination, to be
a mere pretence or disguise."
From what we have said earlier it should be
manifestly clear that the Delhi State Legislature
did not transgress any of the limitations placed
on it, when it enacted the impugned legislation.
There being no transgress whatsoever, the further
question of the transgression being veiled by a
disguise or pretence does not really arise. Nor is
it necessary for us to enquire into the motives
which led the Delhi State Legislature to enact the
impugned legislation. In the affidavits filed on
behalf of the respondents enough materials have
been placed to show why the Delhi State
Legislature considered it necessary to dissolve
the old Board and transfer the management of the
college to a new Board. This was a matter for the
Legislature to consider and not for this Court to
investigate.
In the result we hold that there is no merit
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 27 of 35
in the petition which is accordingly dismissed
with costs
MUDHOLKAR, J.-While I agree with my brother
Das J., that the petition be dismissed I would
like to say a few words. This petition under Art.
32 of the Constitution has been preferred by
194
the Board of Trustees, Ayurvedic and Unani Tibia
College, through its Secretary, Hakim Mohammad
Jamil Khan
By Act 5 of 1952 called the Tibia College hi
Act, 1952 the erstwhile Delhi State Legislative
Assembly dissolved the Board of Trustees of the
Ayurvedic and Unani Tibia (College, incorporated a
Board called ’Tibia College Board’ and transferred
to that Board all the property, rights, powers and
privileges of the Board of Trustees of the
Ayurvedic and Unani Tibia College also the
management and control of the Ayurvedic and Unani
Tibia College to the aforesaid Board. The reason
for doing so would appear from the Statement of
objects and Reasons appended to the Bill which are
as follows:
This Bill seeks to take powers for
transferring the management of the Ayurvedic and
Unani Tibia College, Delhi, from its present
trustees to a Board under the control of the Delhi
State Government. The College has been grossly
mismanaged for some time past with the result that
its reputation is very low today. In early 1949,
the situation deteriorated to such an extent that
there were students strikes, defalcation of funds
and frequent interruptions in scholastic work. The
Collector, Delhi made an interim prayer to the
Civil Court for the appointment of receivers. This
prayer was granted and three receivers appointed
by the Civil Court are at present in charge of the
properties and management of the institution. This
arrangement, which is good so far as it goes, is
inevitably temporary and inadequate, and it seems
desirable to provide by legislation for the
control and management of the College and the
properties attached thereto." (Statement of
objects and Reasons published in the Gazette of
India, Extraordinary, Part II, s. 2, July 18,
1952).
The petitioner’s complaint is that its
property has been taken may without compensation
and
195
handed over to a Board in contravention of Art. 31
of the Constitution and that this has been done
under a law which the Delhi legislature was not
competent to make.
The following four contentions were raised by
Mr. Purshottam Trikamdas on behalf of the
petitioner.
(1) That the Delhi Legislative Assembly
was not competent to pass the impugned Act.
(2) Even assuming that it had
legislative competence the Act offends Arts.
14, 19 and 31.
(3) The Societies Registration Act under
which the Board of Trustees were registered
being a Central Act the Delhi legislative
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 28 of 35
assembly had no power to over-ride it.
(4) The law was enacted by the
legislature mala fide.
I will confine my observations mainly to the
first and third points because, it is only with
regard to them that my view is somewhat different
from that taken by my learned brother.
The respondents point out that the petitioner
Board having been registered under the Societies
Registration Act, 1860 is nothing more than an
unincorporated society and that the Delhi State
legislature was competent to enact a affecting
it under the latter part of Entry 32 of List II
which runs thus:
"........... unincorporated trading,
literary, Scientific, religious and other
societies. and assassination; co-operative
societies".
According, however, to Mr. Purshottam, after the
Board of Trustees was registered as a Society
under the Societies Registration Act it blossomed
into a corporation and since admittedly its
objects extend beyond the limits of the Delhi
State the State Assembly could not make any law
affecting
196
it. This contention has been negatived by my
learned brother. An alternative contention
was also raised on behalf of the petitioner on
the basis of certain decisions and my opinion
in Servants of India Society, Poona v. The
Charity Commissioner of Bombay (1) to the effect
that upon registration J. the Board became at
least a quasi-corporation. This contention has
also been negatived by my learned brother.
If, as the petitioner says the Board, after
registration under the Societies Registration
Act, 1860 was transformed into a corporation the
Delhi Legislative assembly could not make a LAW
with respect to it under Entry 32 because though
under the first part thereof it can make a law
affecting corporation, its powers cannot reach a
corporation, the objects of which extend beyond
the limit of the Delhi State. But as my learned
brother has pointed out and with which I
respectfully agree, the essence of a corporation
is its incorporation’ and as the Societies
Registration Act does not provide for
incorporation the petitioner cannot be recorded as
a corporation. It is true that even though it
possesses some of the attributes of a corporation
it ii not a corporation but in my view it is a
near corporation’ or a quasi-corporation’. This
is what I have held in the Servants of India
Society’s case (1) and I adhere to that view.
There, relying on some Indian decision and the
decision in The Taff Vale Railway Co. v. The
Amalgamated Society of Railway Servants(2), I held
that such a society is a legal entity and that a
State legislature cannot make any law affecting it
under the second part of Entry 32 of List II. The
question whether a registered society which
enjoyed more or less the same powers as those
under the Societies Registration Act is a legal
entity fell for consideration by the House of
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 29 of 35
Lords in Bonsor v. Medicines’ Union(3) and there
Lords Morton and Parker held that
(1) (1960) 63 Bom L.R. 379; 381 (2) [1901]
A.C. 426.
(3) [1956] A.C.104
197
such a society is a legal entity though not a
corporation and thus accepted the position that
there is an intermediate semi-corporation status.
Lord Keith held that such a society is both a
legal entity and association of individuals, that
is, it is a quasi-corporation to the extent
recognized by the governing statute and a
voluntary association for other purpose. Lords
McDermott and Somervell, however, did not accept
the position that there is any intermediate semi-
corporate status at all. With respect, I think
that the view taken by the majority has much to
commend itself. That this is the better view is
the opinion of Prof. Dennis Lloyd (vide 1956 M. L.
R. at p. 360) and of Dr. Glanville William (vide
Salmond’s Jurisprudence, 1957 ed. p. 356). I have
not come across a contrary opinion in any recent
treatise or article.
Now, under the Societies Registration Act,
1860, which was enacted by the Governor General in
Council upon registration a society is entitled to
sue and can be sued in the name of its President,
Secretary etc., as shall be determined by its
rules or by its governing body. A suit by or
against the society would not abate by reason of
the death of the person through whom or against
whom the suit had been brought. A judgement
obtained against a person sued as representing a
society shall not be enforced against him but
against the property of the society. The society
can sue any of its members for arrear of
subscription, damages etc. It can also enter into
contracts as an entity. Upon dissolution, its
property cannot be distributed amongst its members
but must go to some other society.
All these are the characteristics of a
separate legal entity such as a corporation. If
the law confers on a body all the normal powers of
a legal person it will be a corporation in all but
name. A registered society, however, cannot hold
property and to that extent it must be treated a
a voluntary
198
association, made up of its constituents.
Therefore, it can be regarded as a quasi-
corporation or, in the words of Lords Morton and
Porter, a near-corporation". Now, a quasi-
corporation or a near corporation-whatever we may
call it-being a legal entity at least for some
purposes is not a mere society made up of its
constituents.
The question, therefore, must be considered
whether the latter part of Entry 32 confers power
on the State legislator to legislate about legal
entities.’ Let US consider the scope of the latter
part of Entry 32. It permits the making of laws
concerning societies and associations which are
not incorporated. This would imply that thereunder
the legislature cannot provide for the
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 30 of 35
incorporation’ of a society or association. One of
the main results of incorporation is to confer
upon the thing incorporated the status of a
separate legal entity. Even so, under this Entry
the legislator has a wide discretion in the matter
of conferral of powers upon a society. But can it
confer such powers on it as would alter its
character as a society and convert it into a legal
entity, may be only for certain purposes? By its
very definition a society is a voluntary
association and can have no existence separate
from its constituents. It is thus not a separate
legal entity ill any sense and for any purpose.
That Entry makes it clear by using the word
unincorporated’, that the power conferred by it is
confined to such societies and associations only.
Therefore, in my judgment the Entry does not
permit of any law being made which confers on a
society such powers as would constitute it into a
legal entity. A fortiorari, it does not permit a
law to be made which takes away from society
already existing and which is a legal entity any
of the powers of that legal entity, such as those
conferred by the Societies Registration Act, 1860,
much less can it destroy that entity For doing so
it will have to take the aid of other entries, if
any, which permit legislation concerning Legal
entities .
199
The Board, as already stated, was registered
under the Societies Registration Act, 1860. That
was a law made by the Indian legislature under 24
& 25 Vict. ch. 67 passed in the year 1860. That
law conferred the power to make laws for the whole
of British India on the Governor-General-in-
Council the ambit of whose power is set out in 8.
22 which runs thus:
The Governor General in Council shall
have Power at Meetings for the Purpose of
making Laws and Regulations a aforesaid, and
subject to the Provisions herein contained,
to make Laws and Regulations for repealing,
amending, or altering any Laws or Regulations
whatever now in force or hereafter to be in
force the Indian Territories now under the
Dominion of Her Majesty, and to make Laws and
Regulations for all Persons, Whether British
or Native, Foreigners or others, and for all
Courts of Justice whatever, and for all
Places and Things whatever within the said
Territories, and for all Servants of the
Government of India within the dominions of
Princes and States in Alliance with Her
majesty; and the Laws and Regulations so to
be made by the Governor general in Council
shall control and supersede and Laws and
Regulations in anywise repugnant thereto
which shall have been made prior thereto by
the Governors of the Presidencies of Fort
Saint George and Bombay respectively in
Council, or the Governor or Lieutenant
Governor in Council of any Presidency or
other territory for which a council may be
appointed, with Power to make law and
Regulations, under and by virtue of these
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 31 of 35
Act: Provided always, that the said Governor
General in Council shall not have the power
of making any Laws or Regulations which shall
repeal or in any way affect any of the
Provisions of this Act.
200
Or any of the Provisions of the Acts
of the Third and Fourth Years of King
William the Fourth, Chapter Eighty-five and
the Sixteenth and Seventeenth Years of Her
Majesty, Chapter Ninety-five, and of the
Seventeenth and Eighteenth Years of Her
Majesty, Chapter Seventy-Seven, which after
the pacing of this Act shall remain in force:
or any Provisions of the Act of the Twenty-
first and Twenty-second Years of Her Majesty,
Chapter one Hundred and Six entitled an
Act for the better Government of India; or of
the Act of the Twenty-second and Twenty-third
years of Her Majesty, Chapter Forty-one, to
amend the same: or of any Act enabling the
Secretary of State in Council to raise Money
in the United Kingdom for the Government of
India: or of the Acts for punishing Mutiny
and Desertion in Her Majesty’s Army or in Her
Majesty‘s Indian Forces reflectively; but
subject to the Provision contained in the Act
of the Third and Fourth Years of King William
the Fourth, Chapter Eighty-five, Section
Seventy-three, respecting the Indian Articles
of War:
Or any Provisions of any Act passed in
this present session of Parliament, or here
after to be passed, in anywise affecting Her
Majesty‘s Indian Territories, or the
Inhabitants thereof:
Or which may affect the Authority of
Parliament, or the Constitution and rights of
the East India Company, or any Part of the
unwritten Laws or constitution of the United
Kingdom of Great Britain and Ireland, where
on may depend in any Degree the Allegiance of
any Person to the Crown of the United
Kingdom, or the Sovereignty or Dominion of
the Crown over any Part of the said
Territories "
201
This clearly shows that the Governor General
in Council was unhampered in the matter of making
laws by any legislative lists and thus enjoyed
plenary powers to make any kind of law on every
conceivable topic which did not fall within the
excepted Categories. Within the sphere of his
powers the Governor General in Council was and
could consequently make a law conferring upon a
society such powers as could transform it into
legal entity either for all purposes or only some.
If he chose to confer all the powers of a
corporation upon a registered society, that
society would become a corporation in all but a
name.
The position of the State Legislature in the
matter of making laws is not the same as that of
the Governor General in Council under the statute
of 1860. For, though it enjoys no less plenary
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 32 of 35
powers than the Governor General in Council, its
spheres of legislation are restricted by the
legislative lists and it cannot overstep them by
doing something directly which is patently outside
Lists
The only entry in List II on which reliance
was placed on behalf of the respondents as
conferring power on the Delhi legislature to make
the impugned law is the latter part of Entry 32,
List II. That entry speak of societies, that is,
of associations of individuals as distinct from a
legal entity, from that which has a separate legal
existence. An association has no such separate
existence, that is, none apart from its members.
That entry therefore, could not furnish the Delhi
legislature with the power to make a law affecting
a separate legal entity such as the petitioner.
Section of the impugned Act dissolved the
petitioner, a legal entity and transfers its
property, rights etc., to a corporation created by
it. Thus it deals with a legal entity and the
rights of that entity. This is wholly outside the
ambit of the latter part of Entry 32. It would
have been
202
possible for the State legislature to resort to
the first part of that Entry had the object of
the society been limited to the Delhi state but,
as already’’ stated, the objects extent beyond the
Delhi State. The reason why I think it would have
been possible is that the entry is not restricted
to incorporation of a corporation but deals also
with the regulation or winding up of a
corporation which would include a quasi-
corporation or any other fictitious legal person,
and further because the essence of winding up can
be no different from that of dissolution.
No doubt, ours is a federal constitution and
the legislative fields of Parliament and of the
state legislatures are demarcated, In addition we
have a concurrent field in which Parliaments
legislative power is exercisable and, subject to
certain conditions, also that of the state
legislatures. But even so, there is a certain
amount of overlapping in the entries in the three
lists pertaining to these three legislative
fields. Therefore when a law is challenged on the
ground of legislative competence what one has to
ascertain is its pith and substance. It is well
settled that if in pith and substance it is found
that the legislature could make that law under a
particular entry, the mere fact that it
incidentally trenches upou some other entry, not
pertaining to the legislation, it cannot be struck
down as being beyond the competence of the
legislature which made it.
For finding out its pith and substance, let
us examine the Act. It is comprised of 16
sections. Section 3 deals with the incorporation
of the Tibia college Board and transferring to it
the management and control of the Tibia College
vested in the petitioner-board. Section 9 deals
with the dissolution and transfer of property of
the Board of Trustee of the Ayurvedic and Unani
Tibia College Delhi to the Tibia College Board and
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 33 of 35
the remaining sections deal with incidental
matters such as
203
definitions, constitution of the Board, powers of
the Board and so on.
One of the conclusion reached by my learned
brother is that Ho far as the dissolution of the
old Board is concerned the impugned law falls
under the second part of Entry 32 and so far the
incorporation of the new Board is concerned under
its first part. It may be that a legislature may
seek to derive its powers to enact a law
concerning different topics from various entries
in legislative List. But this aspect of a
legislatures power has no significance when, in a
divided jurisdiction its law is challenged on the
ground of encrouchment on a field not open to it.
Tho question which would then arise for
consideration would be what is the pith and
substance of the law? The degree of encroachment
made by it on another field would be a guide for
ascertaining its pith and substance . Here the
impugned Act is aimed at dissolving the
petitioner, Board and transferring all its
property, rights etc. No doubt, the transfer is to
be in favour of a corporation created be the At.
No doubt also, that most of the provisions of the
act, apart from 3 and 9, deal exclusively with
matters pertaining to the newly created entity.
But looking to the preamble as well as ss. 3 and
of the act the creation of new Board and its
incorporation is not the pith and substance of the
Act. The sole reason for its creation is to
transfer to it what was, till then, with the
petitioner-Board. The new Board was thus to serve
only a consequential purpose and its incorporation
cannot be said to be the pith and substance of the
impugned Act. The activities of the petitioner
were not confined to the state of Delhi. That Act
cannot there fore, be sustained by reference to
the first part of Entry 2. The pith and substance
of the law being the dissolution of the petitioner
Board, a legal entity, and transference of its
property and rights to someone else, it cannot be
sustained by reference to the power conferred by
the latter part of Entry 32.
204
For sustaining the law the learned Solicitor
General had played reliance also on Entries 10 and
28 of List II. What we have to See, therefore, is
whether the impugned law could be made by the
Delhi Legislature under these entries .
It is not disputed that the Petitioner-Board
is a trustee. It is also clear from the objects
with which the trust was established, (which have
been set out in the judgment of my learned
brother) that it was for a charitable purpose. The
petitioner is, therefore, a charitable trust and
the object of the law is to dissolve it and
transfer its property etc. Entries 10 and 28 of
List III run thus:
Entry 10: Trust and Trustees".
Entry 28: "Charities and charitable
institutions, charitable and religious
endowments and religious legislatures".
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 34 of 35
The entries are not limited to trusts or
charitable institutions which are ’unincorporated
societies’ as is the, latter part of Entry 32 of
List II. Entry 10 clearly permits a law being made
with regard to a trust or trustee which is a
separate legal entity. Similarly Entry 32 permits
a law to be made affecting charities and
charitable institutions of every kind, whether
consisting of voluntary associations of
individuals or having a corporate or semi-
corporate character. For, institutions may have a
corporate or a semi-corporate character as for
instance Hindu religious endowments and these are
plainly included in the later Entry. The Delhi
legislature had, therefore, competence to make a
law dissolving a charitable trust and transferring
its property, right etc., to another institution.
The aforesaid two entries permit making a law of
this kind. No doubt these entries are in the
concurrent field but sine the impugned Act was
reserved for the assent of the President and was
assented to by him on September 12, 1952, it
205
cannot be called in question on the ground of
repugnancy with an ’existing law’ or a law made by
Parliament.
I agree with the view taken by my learned
brother on the second and the fourth points urged
by Mr. Purshottam and have nothing to add.
As regards the third point the argument on
behalf of the petitioner is that s. 22 of the
Government of Part States Act, 1951 (which created
a legislature for the Delhi State, then a Part
State) precluded the Delhi legislature from
enacting a law repugnant to an Act of Parliament
and that as the impugned Act contains provisions
which are repugnant to those of the Societies
Registration Act 1860, it is ultra vires. Apart
from the fact that what a 22 prohibits is a
repugnancy with a law made by Parliament itself
the Societies Registration Act is not one of such
law the argument does not really arise upon the
view I have taken. The petitioner-Board upon
Registration under that Act becomes a quasi-
corporation and thus a separate legal entity. Even
though it owed its existence to the provisions of
the Societies Registration Act, the Delhi
legislature was free to deal with it under its
powers under List III because by doing so it did
not enact a law repugnant to the provisions of the
Societies Registration Act. That Act still retains
its full force and rigour and is unaffected by the
impugned Act. The petitioner Board may, by
operation of the impugned law, not be able to
exercise any of its powers under the Societies
Registration Act but that would be not because the
provisions of that law are abrogated in any sense
but because the petitioner-Board has ceased to
exist a a legal entity. The argument- must,
therefore, be rejected.
The petition is, therefore, dismissed with
costs.
Petition dismissed.
206
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 35 of 35