TMI Blog2019 (7) TMI 1631X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be evident from the statement of objects and reasons as also preamble of the Act of 1993. Section 1(4) of the Act of 1993 has not indicated any outer threshold value of the claim upto which the limit could be raised but we see no reason to enter into that aspect firstly because the validity of Section 1(4) of the Act of 1993 has not been challenged in the present writ petition and secondly we are satisfied with the reasons given by the Central Government that enhancing the threshold limit for filing claims before the Tribunals to twenty lakh rupees, cannot be considered excessive. Even otherwise, the worth of ten lakh rupees in the year 1993 when the Act was introduced, due to price inflation, was ₹ 49.23 lakh in the year 2017, meaning thereby, the value of one rupee in 1993 stood reduced to approximately twenty paisa in 2017. Even when the constitutional validity of Section 1(4) of the Act of 1993 has not been challenged in the present writ petition, we find that sufficient guidelines are available in the Act of 1993 by way of its preamble, statement of objects and reasons, which provide ample justification for the decision of the Central Government for raising the th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he other parties, the jurisdiction of the Tribunal in a debt claim of more than ten lakh rupees may be attracted but if it is less than ten lakh rupees, the ordinary civil court would have the jurisdiction. But the Central Government by the impugned notification has now created a situation where the claims of more than ten lakh rupees, upto twenty lakh rupees, would be excluded from the purview of the Debts Recovery Tribunal and sent to the Civil Courts. Relying on the judgment of Division Bench of the Allahabad High Court in Mudit Entertainment Industries Vs. Banaras State Bank Ltd. and Others 2000 (2) AWC 1008 : (2000) 1 UPLBEC 25, learned counsel argued that the High Court on interpretation of Section 1(4) of the Act of 1993 held that having regard to the contingency, debts less than ten lakh but more than one lakh can be included within the purview of the Tribunal. It is thus evident that the authority has been conferred on the Central Government to only reduce the amount of claim from ten lakh rupees downwards but with a rider that such reduction in the amount shall not be less than one lakh rupees. Ms. Anita Aggarwal, learned counsel for the petitioners, submitted that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Anita Aggarwal, learned counsel for the petitioners, argued that mere use of punctuation marks in between the words less ten lakh rupees or such other amount and being not less than one lakh rupees would not give jurisdiction to the Central Government to increase the limit of ten lakh rupees to twenty lakh rupees. Learned counsel relied on the judgment of the Allahabad High Court in L. Mansa Vs. Mt. Ancho AIR 1933 All. 521, wherein it was held that punctuation marks cannot control the meaning of a section. Intention of the legislature in the present case has to be gathered from the plain reading of the provision. Reliance is also placed on the judgment of the Supreme Court in Central Bank of India Vs. State of Kerala Others (2009) 4 SCC 94, wherein it has been held that the sole criteria of enactment of the Act of 1993 and the establishment of the Debts Recovery Tribunals has been to ensure expeditious recovery of the bank debts. It is argued that the Supreme Court in State of West Bengal and Others Vs. Swapan Kumar Guha and Others (1982) 1 SCC 561 held that it would be safer and more satisfactory to discover the true meaning of the clause by having regard to substanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithin the ambit of excessive delegation, thus making it bad and amenable to challenge on such ground. It is submitted that the Supreme Court in Union of India Vs. Brig. P.S. Gill (2012) 4 SCC 463, held that each word used in the enactment must be allowed to play its role, howsoever, significant or insignificant, the same may be, in achieving the legislative intent and promoting legislative object. Reliance is also placed on the judgments of the Supreme Court in Ajoy Kumar Banerjee Vs. Union of India (1984) 3 SCC 127 and J.K. Industries Ltd. Vs. Union of India (2007) 13 SCC 673. E-converso, Mr. R.D. Rastogi, learned Additional Solicitor General, opposed the writ petition and submitted that the challenge to the notification dated 06.09.2018 is absolutely devoid of any merit. The petitioners have failed to show how the aforesaid notification is contrary to the provisions of Section 1(4) of the Act of 1993. When it was originally enacted, Section 1(4) provided the threshold value of ten lakh rupees for a claim to be filed before the Tribunal and also provided that the Central Government may, by notification, specify such other amount, being not less than one lakh rupees. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the progress of cases having value of more than twenty lakh rupees. Reference is made to various figures and data to which we shall advert little later. Mr. R.D. Rastogi, learned Additional Solicitor General, argued that the Supreme Court in number of cases has categorically held that there is presumption of constitutional validity in favour of an enactment and it is the duty of the court to uphold the constitutional validity of a statute. The burden is on him who challenges the same to show that there has been a clear transgression of constitutional principles. The petitioner has failed to show that how the notification transgresses constitutional limits. Reliance is placed on the judgment of the Supreme Court in Dharmendra Khirtal Vs. State of U.P. - (2013) 8 SCC 368. It is argued that the constitutional validity of the provisions of the Act of 1993 has already been tested and upheld by the Supreme Court in Union of India and Another Vs. Delhi High Court Bar Association and Others, supra. Reliance is also placed on the judgment of the Supreme Court in State of Bombay Vs. Narottam Das Jethabhai and Another, supra. Relying on the judgments of the Supreme Court in State of Orissa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such other amount, being not less than one lakh rupees, as the Central Government may, by notification, specify. Reading of the aforesaid provision at the first blush makes one gather the impression that the Parliament by aforesaid provision has prescribed the minimum limit of ten lakh rupees for applicability of the provisions of the Act of 1993 to the claims but at the same time, it gave the authority to the Central Government to specify by notification such other amount being not less than one lakh rupees . The cursory reading of the aforesaid provision therefore also gives the further impression that while the Central Government in specifying such other amount may choose any amount between ten and one lakh rupees but neither can it specify an amount higher than ten lakh rupees nor less than one lakh rupees. However on deeper examination we have concluded, for reasons we shall state hereinafter, that while the Central Government is not competent to specify any amount which is less than one lakh rupees for the purpose of attractibility of the provisions of the Act of 1993, but it can certainly enhance the threshold limit of ten lakh rupees. Section 1(4) of the Act of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rring, judgments, whereby the decision of the Bombay High Court was reversed. Hon ble Mr. Justice Fazl Ali, who presided over the Bench, repelled the argument that a Provincial Legislature has, by aforesaid Section 4, delegated the legislative power to the Provincial Government, which it cannot do. The relevant discussion was made in para 18 of the judgment, which reads thus:- 18. It is contended that this section is invalid, because the Provincial Legislature has thereby delegated its legislative powers to the Provincial Government which it cannot do. This contention does not appear to me to be sound. The section itself shows that the Provincial Legislature having exercised its judgment and determined that the New Court should be invested with jurisdiction to try suits and proceedings of a civil nature of a value not exceeding ₹ 25,000, left it to the Provincial Government to determine when the Court should be invested with this larger jurisdiction, for which the limit had been fixed. It is clear that if and when the New Court has to be invested with the larger jurisdiction, that jurisdiction would be due to no other authority than the Provincial Legislature itself and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as to the conditions subject to which and as to the amount up to which the new court could have pecuniary jurisdiction. All that was left to the discretion of the Provincial Government was the determination of the circumstances under which the new court would be clothed with enhanced pecuniary jurisdiction. The vital matters of policy having been determined, the actual execution of that policy was left to the Provincial Government and to such conditional legislation no exception could be taken. The section does not empower the Provincial Government to enact a law as regards the pecuniary jurisdiction of the new court and it can in no sense be held to be legislation conferring legislative power on the Provincial Government. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx. Hon'ble Mr. Justice B.K. Mukherjea gave his concurring opinion in para 58 of the report, which reads as under:- 58. As regards the first point, I agree that the contention of the appellant is sound and must prevail. I have no hesitation in holding that the Legislature in empowering the Provincial Government to invest the City Court, by notification, with jurisdiction o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e exceptions specified in Section 3 clearly indicate that the Legislature itself has decided that the extension of the pecuniary jurisdiction of the new Court should be made, not necessarily or at all events or all at any one time but when the Provincial Government may consider it desirable to do so and while entrusting a discretionary power with the Provincial Government to determine the time for investing such extended jurisdiction on the new Court, the Legislature itself has also prescribed the limits of such extension. Xxxxx xxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx. The 7-Judge Constitutional Bench of the Supreme Court in In Re: Art. 143, Constitution of India and Delhi Laws Act (1912) etc. Vs. The Part C States (Laws) Act, 1950 - AIR 1951 SC 332, held that in a conditional legislation, the law is full and complete when it leaves the legislative chamber, but the operation of the law is made dependent upon the fulfillment of a condition, and what is delegated to an outside body/the authority to determine, by the exercise of its own judgment, whether or not the condition has been fulfilled. Thus, conditional legislation has all along been treate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fect or at such time, as it decides or to understand the rule of legislation, it would be a conditional legislation. The legislature in such a case makes the law, which is complete in all respects but the same is not brought into operation immediately. The enforcement of the law would depend upon the fulfilment of a condition and what is delegated to the executive is the authority to determine by exercising its own judgment as to whether such conditions have been fulfilled and/or the time has come when such legislation should be brought in force. The taking effect of a legislation, therefore, is made dependent upon the determination of such fact or condition by the executive organ of the Government. Delegated legislation, however, involves delegation of rule making power of legislation and authorises an executive authority to bring in force such an area by reason thereof. The discretion conferred on the executive by way of delegated legislation is much wider. Such power to make rules or regulations, however, must be exercised within the four corners of the Act. Delegated legislation, thus, is a device which has been fashioned by the legislature to be exercised in the manner laid do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned by the Act, viz., the recovery case in the segment of ten to twenty lakh rupees. When such a power by way of conditional legislation is to be exercised by the delegate a question may arise as to how the said power can be exercised. In such an eventuality if the satisfaction regarding the existence of condition precedent to the exercise of such power depends upon pure subjective satisfaction of the delegate. In Harishankar Bagla and Another Vs. The State of Madhya Pradesh (1955) 1 SCR 380 of the Supreme Court challenge was made to Sections 3 and 4 of the Essential Supplies (Temporary Powers) Act, 1946 on the ground that it was ultra vires of delegated legislation and the challenge was repelled. It was held that the Legislature must declare the policy of the law and the legal principles which are to control any given cases and must provide a standard to guide the officials or the body in power to execute the law. The essential legislative function consists in the determination or choice of the legislative policy and of formally enacting that policy into a binding rule of conduct. It was further held that the legislature has laid down such a principle and that principle the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor Banks and about ₹ 391 crores of dues of the financial institutions. The locking up of such huge amount of public money in litigation prevents proper utilization and recycling of the funds for the development of the country. We may refer to the judgment of the Supreme Court in the Consumer Action Group and Another Vs. State of Tamil Nadu and Others (2000) 7 SCC 425, wherein it was held that not only preamble and objects and reasons of the Act clearly indicate its policy but it is also revealed through various provisions of the enactment. In that case, the constitutional validity of Section 113 of the Tamil Nadu Town and Country Planning Act, 1971 was challenged as being ultra vires Articles 14 and 21 of the Constitution of India. Following observations of the Supreme Court in this behalf are quite relevant to quote:- The catena of decisions referred to above concludes unwaveringly in spite of very wide power being conferred on delegatee that such a section would still not be ultra vires, if guideline could be gathered from the Preamble, Object and Reasons and other provisions of the Acts and Rules. In testing validity of such provision, the courts have to discov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ht to be remedied. It is a key to unlock the mind of legislature in relation to substantive provisions of statutes and it is also well settled that a statute is best interpreted when we know why it was enacted. The Supreme Court in Shailesh Dhairyawan Vs. Mohan Balkrishna Lulla (2016) 3 SCC 619, held that the principle of 'purposive interpretation' or 'purposive construction' is based on the understanding that the Court is supposed to attach that meaning to the provisions which serve the 'purpose' behind such a provision. The basic approach is to ascertain what is it designed to accomplish? To put it otherwise, by interpretative process the Court is supposed to realise the goal that the legal text is designed to realise. In Rakesh Kumar Paul Vs. State of Assam (2017) 15 SCC 67 the Supreme Court held that while interpreting any statutory provision, it has always been accepted as a golden rule of interpretation that the words used by the legislature should be given their natural meaning. Normally, the courts should be hesitant to add words or subtract words from the statutory provision. An effort should always be made to read the legislative provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting that the provisions of the Act shall not apply where the amount of debt due to any bank of financial institution is less than ten lakh rupees or such other amount being not less than one lakh rupees, as the Central Government may, by notification, specify. Considering the statement of the objects and the reasons and the purpose with which the Tribunals were/are set up, we find that the Central Government has sufficient reasons for enhancing that limit to twenty lakh rupees. Stand of the Central Government before this Court is that as per the data provided by the Tribunals across the country, 9128 new Original Applications have been filed by the banks in the segment of ten to twenty lakh rupees within a period of six months with effect from 01.01.2018 up to 30.06.2018, which is about 41% of the total of 22,360 Original Applications filed during this period. But in terms of the value, the Original Applications of ten to twenty lakh rupees account for only about 5% of the total value of the recovery claims in Original Applications filed for the period. Further as per the data provided by various Debts Recovery Tribunals on 30.06.2018, there were 38,376 Original Applications pendi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the total value of the recovery claims. The notification issued by the Central Government raising the limit of ten to twenty lakh rupees is therefore intended to achieve the object with which the Tribunals were set up as would be evident from the statement of objects and reasons as also preamble of the Act of 1993. We are conscious of the fact that Section 1(4) of the Act of 1993 has not indicated any outer threshold value of the claim upto which the limit could be raised but we see no reason to enter into that aspect firstly because the validity of Section 1(4) of the Act of 1993 has not been challenged in the present writ petition and secondly we are satisfied with the reasons given by the Central Government that enhancing the threshold limit for filing claims before the Tribunals to twenty lakh rupees, cannot be considered excessive. Even otherwise, the worth of ten lakh rupees in the year 1993 when the Act was introduced, due to price inflation, was ₹ 49.23 lakh in the year 2017, meaning thereby, the value of one rupee in 1993 stood reduced to approximately twenty paisa in 2017. Even when the constitutional validity of Section 1(4) of the Act of 1993 has not been chal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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