1954 (4) TMI 29 - SC - Indian Laws

Payment of annual contribution levied u/s 76 - Settlement of a scheme in connection with a Math known as the Shirur Math - validity of Madras Act 11 of 1927 and the Madras Hindu Religious and Charitable Endowments Act 1951 - distinction between a tax and a fee - co-relation between the expenses incurred by the Government and the amount raised by contribution - Violation of Fundamental rights under Articles 19(1)(f) 25 26 and 27 of the Constitution - HELD THAT - All the collections go to the consolidated fund of the State and all the expenses have to be met not out of these collections but out of the general revenues by a proper method of appropriation as is done in case of other Government expenses. That in itself might not be conclusive but in this case there is total absences of any co-relation between the expenses incurred by the Government and the amount raised by contribution under the provision of section 76 and in these circumstances the theory of a return or counter-payment or quid pro quo cannot have any possible application to this case. In our opinion therefore the High Court was right in holding that the contribution levied under section 76 is a tax and not a fee and consequently it was beyond the power of the State Legislature to enact this provision. Ours being a secular State and there being freedom of religion guaranteed by the Constitution both to individuals and to groups it is against the policy of the Constitution to pay out of public funds any money for the promotion or maintenance of any particular religion or religious denomination. But the object of the contribution under section 76 of the Madras Act is not the fostering or preservation of the Hindu religion or any denomination within it. The purpose is to see that religious trusts and institutions wherever they exist are properly administered. It is a secular administration of the religious legislature seeks to control and the in the Act is to ensure that the institutions that the object as enunciated endowments attached to the religious institutions are properly administered and their income is duly appropriated for the purposes for which they were founded or exist. There is no question of favouring any particular religion or religious denomination in such cases. In our opinion article 27 of the Constitution is not attracted to the facts of the present case. The result therefore is that in our opinion sections 21 30(2) 31, 55, 56 and 63 to 69 are the only sections which should be declared invalid as conflicting with the fundamental rights of the respondent as Mathadhipati of the Math in question and section 76(1) is void as beyond the legislative competence of the Madras State Legislature. The rest of the Act is to be regarded as valid. The decision of the High Court will be modified to this extent but as the judgment of the High Court is affirmed on its merits the appeal will stand dismissed with costs to the respondent. Appeal dismissed.

Summary

The core legal questions considered in this judgment revolve around the constitutional validity of various provisions of the Madras Hindu Religious and Charitable Endowments Act, 1951 (hereinafter "the Act"), as challenged by the head (Mathadhipati) of a religious institution (Math). The principal issues include:

1. Whether the Mathadhipati's rights in the religious institution and its endowments constitute "property" within the meaning of article 19(1)(f) of the Constitution and whether the Act's provisions infringe upon these rights without reasonable restrictions.

2. Whether the Mathadhipati, as the head of a religious institution, enjoys fundamental rights under article 25 (freedom of religion) and article 26 (right of religious denominations to manage their own affairs in matters of religion) of the Constitution, and whether the Act's provisions violate these rights.

3. The interpretation of "religious denomination" under article 26 and whether a Math qualifies as such.

4. The scope of the right to manage "own affairs in matters of religion" under article 26(b) and the distinction between religious and secular matters in this context.

5. Whether the compulsory contribution levied under section 76 of the Act is a "fee" or a "tax" and the constitutional competence of the State Legislature to impose it, including whether it violates article 27 of the Constitution, which prohibits appropriation of taxes for the promotion or maintenance of any particular religion or religious denomination.

6. Whether certain procedural and administrative provisions of the Act, such as powers of entry into religious institutions (section 21), appointment of managers (section 56), and notification of religious institutions (sections 63 to 69), are constitutionally valid or ultra vires fundamental rights guaranteed under the Constitution.

Issue-wise Detailed Analysis:

1. Property Rights of the Mathadhipati under Article 19(1)(f)

The Court examined whether the Mathadhipati holds a proprietary interest in the Math and its endowments. Precedents from the Judicial Committee of the Privy Council and Indian courts established that the Mathadhipati's position blends elements of office and property, duties and personal interest. The proprietary element, though anomalous, is recognized as a genuine legal right, akin to the Shebaitship right recognized in Hindu law. The Court emphasized that the Mathadhipati's beneficial interest includes large powers of disposal and administration of endowed properties.

Applying a liberal and wide interpretation to the term "property" in article 19(1)(f), the Court held that the Mathadhipati's rights constitute property rights protected under the Constitution. Reasonable restrictions can be imposed in public interest, but restrictions that reduce the Mathadhipati to a mere servant or destroy the character of the office are unreasonable and unconstitutional.

The Court declined to adopt a narrow view expressed by a former Chief Justice that article 19(1)(f) protects only abstract rights to property, reaffirming that concrete property rights are protected.

2. Freedom of Religion under Article 25

The Court held that article 25 protects the freedom of every person to practise and propagate religion. While the Mathadhipati is not a corporate body but an individual head of a spiritual fraternity, he exercises duties as a religious teacher. Restrictions on his ability to practise and propagate the religion affect his fundamental rights under article 25. The Court clarified that the right protects acts done in pursuance of religion, not merely religious beliefs.

3. Right of Religious Denominations under Article 26

The Court interpreted "religious denomination" as a collective of individuals sharing a common faith and organization, designated by a distinctive name. It held that a Math, representing a section of followers of a religious teacher (here, Madhwacharya), qualifies as a religious denomination or a section thereof under article 26.

Regarding the right to manage "own affairs in matters of religion" under article 26(b), the Court distinguished between religious matters and secular or administrative matters. Religious matters include rites, ceremonies, worship, and observances integral to religion, even if they involve expenditure or employment of persons. Secular matters, such as administration of property, fall outside this protection and can be regulated by law.

The Court emphasized that the right to manage religious affairs is absolute and cannot be interfered with by the State, but administration of property is subject to reasonable regulation.

4. Restrictions on Religious Practices and Activities

The Court acknowledged the constitutional provisions that allow the State to regulate or restrict religious practices on grounds of public order, health, and morality, and to legislate for social welfare and reform. However, it rejected the broad contention that all secular activities associated with religion are amenable to State regulation. The Court held that essential religious practices, even if involving expenditure or secular elements, are protected.

The Court referred to foreign jurisprudence (American and Australian cases) to illustrate the delicate balance between religious freedom and State interests, emphasizing that the Indian Constitution explicitly incorporates such limitations.

5. Validity of Specific Provisions of the Act

The Court reviewed numerous sections of the Act challenged as unconstitutional:

• Section 20: Powers of the Commissioner to ensure proper administration were upheld as reasonable supervision consistent with the trustee-like position of the Mathadhipati.
• Section 21: The power to enter any part of a religious institution, including sanctums, without restrictions or regard to custom, was held invalid as it infringed articles 25 and 26.
• Sections 23 and 24: Duties to obey lawful orders and to exercise prudence in administration were upheld.
• Sections 25(4) and 26: Preparation and verification of registers were held valid.
• Section 29: Restrictions on alienation of endowed property were upheld as reasonable.
• Sections 30(2) and 31: Provisions requiring the trustee to act under instructions of the Commissioner or Deputy Commissioner in spending surplus funds were invalid as unreasonable restrictions on property and management rights.
• Section 54: Fixing a scale of expenditure with government oversight was upheld as reasonable.
• Section 55: Restrictions on the Mahant's power over personal gifts (Pathakanikas) and requirement to keep accounts were invalid as unreasonable encroachments.
• Section 56: Power to require appointment of a manager for secular affairs, with the Commissioner able to appoint one unilaterally, was invalid as it could reduce the Mahant to a mere servant.
• Sections 58 and 59: Powers to frame schemes and apply the cy pres doctrine were upheld as valid, with safeguards of appeal and suit.
• Sections 63 to 69: Provisions for notification of religious institutions, which allowed takeover of administration without court access, were held invalid.
• Section 70(3): Power to alter budgets was upheld with appeal provisions.
• Section 89: Penalties for refusal to comply with valid provisions were upheld.
• Section 99: Revisional power vested in Government was considered beneficial and valid.

6. Nature of the Contribution under Section 76

The Court analyzed whether the compulsory contribution levied on religious institutions under section 76 is a fee or a tax. It examined constitutional entries and definitions, relying on authoritative definitions:

• A tax is a compulsory exaction for public purposes, not payment for services rendered.
• A fee is a charge for a special service rendered, correlated to the cost of the service.

The Court noted that although the contribution is described as payable for services rendered by the Government, the amount is not correlated to actual expenses, is based on income capacity, and the proceeds go to the consolidated fund rather than being earmarked. These characteristics align more with a tax than a fee.

Consequently, the Court held section 76 imposes a tax, which the State Legislature lacks competence to enact, as it is not enumerated in the State's legislative entries. The contribution was also challenged under article 27, which prohibits appropriation of taxes for promotion or maintenance of religion. The Court found that the tax is not specifically appropriated for any religion but for secular administration of religious trusts, so article 27 was not attracted.

7. Treatment of Competing Arguments and Conclusions

The Court carefully balanced the State's interest in regulating religious institutions and the fundamental rights of religious denominations and their heads. It acknowledged the necessity of supervision to prevent mismanagement but rejected provisions that excessively interfered with the spiritual and proprietary rights of the Mathadhipati.

The Court distinguished between reasonable regulation of secular aspects and impermissible interference with religious management. It struck down provisions that allowed arbitrary appointment of managers, unrestricted entry into sacred places, and compulsory obedience to government instructions in matters integral to religion and proprietary rights.

The Court modified the High Court's decision by excluding some sections wrongly invalidated (18, 39(2), 42) and upholding others (20, 23, 24, 25(4), 26, 29, 54, 58, 59, 70(3), 89, 99) as constitutionally valid.

However, it agreed with the High Court in invalidating sections 21, 30(2), 31, 55, 56, and 63 to 69, and declared section 76 void for legislative incompetence.

Significant Holdings and Core Principles

"The personal or beneficial interest of the Mahant in the endowments attached to an institution is manifested in his large powers of disposal and administration and his right to create derivative tenures in respect to endowed properties; and these and other rights of a similar character invest the office of the Mahant with the character of proprietary right which, though anomalous to some extent, is still a genuine legal right."

"The freedom of religion in our Constitution is not confined to religious beliefs only; it extends to religious practices as well subject to the restrictions which the Constitution itself has laid down."

"Under article 26(b), therefore, a religious denomination or organization enjoys complete autonomy in the matter of deciding as to what rites and ceremonies are essential according to the tenets of the religion they hold and no outside authority has any jurisdiction to interfere with their decision in such matters."

"A law which takes away the right of administration from the hands of a religious denomination altogether and vests it in any other authority would amount to a violation of the right guaranteed under clause (d) of article 26."

"The provision of section 21, which does not confine the right of entry to the outer portion of the premises and does not exclude the inner sanctuary, interferes with the fundamental rights of the Mathadhipati and the denomination of which he is head guaranteed under articles 25 and 26 of the Constitution."

"Section 56... is of an extremely drastic character... the effect of the section really is that the Commissioner is at liberty at any moment he chooses to deprive the Mahant of his right to administer the trust property even if there is no negligence or maladministration on his part. Such restriction would be opposed to the provision of article 26(d) of the Constitution."

"Section 76... the money raised by levy of the contribution is not ear-marked or specified for defraying the expenses that the Government has to incur in performing the services. All the collections go to the consolidated fund of the State... the theory of a return or counter-payment or quid pro quo cannot have any possible application to this case. In our opinion... the contribution levied under section 76 is a tax and not a fee and consequently it was beyond the power of the State Legislature to enact this provision."

"The object of the contribution under section 76 of the Madras Act is not the fostering or preservation of the Hindu religion or any denomination within it. The purpose is to see that religious trusts and institutions... are properly administered. It is a secular administration of the religious endowments attached to the religious institutions."

The final determinations were that several provisions of the Act were unconstitutional to the extent they interfered with the proprietary and religious rights of the Mathadhipati and the religious denomination, specifically sections 21, 30(2), 31, 55, 56, and 63 to 69. Section 76 was declared void as beyond the legislative competence of the State Legislature. The rest of the Act was upheld as valid. The appeal was dismissed, affirming the High Court's writ of prohibition preventing the State authority from proceeding with the settlement of the scheme affecting the Mathadhipati's management.