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The doctrine of 'franchise ' or 'privilege ' has its origin in English Common Law and was bound up with the old prerogative of the Crown. Ratio |
This doctrine continued to live in the American legal world as a survival of the pre independence days, though in an altered form. Ratio |
The place of the royal grants under the English Common Law was taken by the legislative grants in America and the grant of special rights by legislation to particular individuals or companies is regarded there as a 'franchise ' or 'Privilege ' differing from the ordinary liberties of a citizen. Ratio |
The carrying on of transport buses by common carriers on the public road in America is a 'franchise ' and not a common law right, which could be claimed by all citizens and a distinction is made, as the cases cited above will show, between contract carriers who carry passengers or goods under particular contracts and c... |
Over the latter the State claims and exercises a plenary power of control. Ratio |
Ayyar J. has, in our opinion, rightly pointed out that this doctrine of 'franchise ' has no place in our Constitution. Ratio |
Under the Indian Constitution the contract (i) I.L.R. 1951 All. 257.(2) 719 carries as well as the common carriers would occupy the same position so far as the guaranteed right under article 19(1) (g) is concerned and both are liable to be controlled by appropriate regulations under clause (6) of that article. Ratio |
The law on the point, as it stands at present, has been thus summed up by the learned Judge : "The true position then is, that all public streets and roads vest in the State, but that the State holds them as trustees on behalf of the public. Ratio |
The members of the public are entitled as beneficiaries to use them as a matter of right and this right is limited only by the similar rights possessed by every other citizen to use the pathways. Ratio |
The State as trustees on behalf of the public is entitled to impose all such limitations on the character and extent of the user as may be requisite for protecting the rights of the public generally ;. . but subject to such limitations the right of a citizen to carry on business in transport vehicles on public pathways... |
" We are in entire agreement with the statement of law made in these passages. Ratio |
Within the limits imposed by State regulations any member of the public can ply motor vehicles on a public road. Ratio |
To that extent he can also carry on the business of transporting passengers with the aid of the vehicles. Ratio |
It is to this carrying on of the trade or business that the guarantee in article 19(1) (g) is attracted and a citizen can legitimately complain if any legislation takes away or curtails that right any more than is permissible under clause (6) of that article. Ratio |
The legislation in the present case has excluded all private bus owners from the field of transport business. Ratio |
Prima facie it is an infraction of the provision of article 19(1) (g) of the Constitution and the question for our consideration therefore is whether this invasion by the Legislature of the fundamental right can be justified under the provision of clause (6) of article 19 on the ground that it imposes reasonable restri... |
720 Article 19(6) of the Constitution, as it stands after the amendment of 1951, makes a three fold provision by way of exception to or limitation upon clause (1) (g) of the article. Ratio |
In the first place it empowers the State to impose reasonable restrictions upon the freedom of trade, business, occupation or profession in the interests of the general public. Ratio |
In the second place it empowers the State to prescribe the professional and technical qualifications necessary for practicing any profession or carrying on any occupation, trade or business. Ratio |
Thirdly, and this is the result of the Constitution (First) Amendment Act of 1951 it enables the State to carry on any trade or business either by itself or through a corporation owned or controlled by the State to the exclusion of private citizens wholly or in part. Ratio |
It is not disputed that the third provision which was introduced by the amendment of the Constitution in 1951 was not in existence when the impugned Act was passed and the High Court rightly held that the validity of the Act is not to be decided by applying the provision of the new clause. Ratio |
The learned Judges held however that quite apart from the new provision, the creation of a State monopoly in regard to transport service, as has been done under the Act, could be justified as reasonable restrictions upon the fundamental right enunciated in article 19(1) (g) of the Constitution imposed in the interests ... |
The question is, whether the view taken by the High Court is right? To answer this question three things will have to be considered. Ratio |
The first is, whether the expression "restriction" as used in article 19(6) and for the matter of that in the other sub clauses of the article, means and includes total deprivation as well? If the answer is in the affirmative, then only the other two questions would arise, namely, whether these restrictions are reasona... |
In the case of Municipal Corporation of the City of Toronto vs Virgo(1), Lord Davey while discussing a statutory power conferred on a Municipal Council to make bye laws for regulating and governing a trade made the following observation: " No doubt the regulation and governance of a trade may involve the imposition of ... |
But their Lordships think that there is a marked distinction to be drawn between the prohibition or prevention of a trade and the regulation or governance of it, and indeed a power to regulate and govern seems to imply the continued existence of that which is to be regulated or governed. PRE |
" This line of reasoning receives support from the observations made by some of the learned Judges of this Court in their respective judgments in the case of A. K. Gopalan vs The State (2). PRE |
The question for consideration in that case was the constitutional validity of the Preventive Detention Act and one of the contentions raised by the learned counsel for the appellant in attacking the validity of the legislation was, that it invaded the right of free movement guaranteed under article 19(1)(d) of the Con... |
This argument was repelled by the majority of the Judges inter alia on the ground that a law which authorises the deprivation of personal liberty did not fall within the purview of article 19 and its validity was not to be judge d by the criteria indicated in that article but depended on its compliance with the require... |
The expression Personal liberty" as used in article 21, it was said, was sufficiently comprehensive to include the particular freedoms enumerated in article 19(1) and its deprivation therefore in accordance with the provision of article 21 would result in automatic extinction of the other freedoms also. PRE |
In this connection reference was made to (1) ,93.(2) ; 722 the several sub clauses of article 19 and Patanjali Sastri J. expressed his views in the following words: "The use of the word 'restrictions ' in the various sub clauses seems to imply, in the context, that the rights guaranteed by the Article are still capable... |
Read as a whole and viewed in its setting among the group of provisions relating to 'right to freedom ', Article 19 seems to my mind to presuppose that the citizen to whom the possession of these fundamental rights is secured retains the substratum of personal freedom on which alone the enjoyment of these rights necess... |
" The point for consideration in that case was undoubtedly different from the one that has arisen in the present case and the question whether the restrictions enumerated in the several sub clauses of article ' 19 could go to the length of total deprivation of these liberties was neither raised nor decided in that case... |
But a distinction was drawn by the majority of learned Judges between negation or deprivation of a right and a restriction upon it and although it was said. Ratio |
that restriction may reach a point where it might amount to deprivation, yet restrictions would normally pre suppose the continued existence no matter even in a very thin and attenuated form of the thing upon which the restrictions were imposed. Ratio |
Kania C.J. in his judgment (vide page 106) expressly said: Therefore Article 19(5) cannot apply to a substantive law depriving a citizen of personal liberty. PRE |
I am unable to accept the contention that the word 'deprivation ' includes within its scope 'restriction ' when interpreting Article 21. PRE |
" Against this view it may be urged that the use of the words 'deprivation" and "restrictions" as interchangeable expressions is not altogether unusual in ordinary language and the nature and extent of restrictions might in some cases amount to a negation of the right. PRE |
The Orissa, High Court in the care of Lokanath 723 Misra vs The State of Orissa (1) accepted this view and made a distinction between "regulation" and "restriction". PRE |
In the opinion of the learned Judges the observations of Lord Davey in Municipal Corporation of the City of Toronto vs Virgo (supra) referred to above could be distinguished on the ground that the expression used in that article was not 'restriction ' but regulation ' and 'governing '. PRE |
It is said that the framers of the Constitution were aware of the distinction between the power to 'regulate ' and the power to 'restrict ' and this would be apparent from a scrutiny of sub clause 'a) of clause (2) of article 25 of the Constitution where the words "regulating" and "restricting" occur in juxtaposition i... |
On behalf of the respondents much reliance has also been placed on a decision of this Court in Cooverjee vs The Excise COMMISSIONER, etc. Ratio |
(2) where the point for consideration was the validity of the Excise Regulation I of 1915. Ratio |
It was contended, inter alia, on behalf of the appellant in that case that the Excise Regulation and the auction sales made thereunder were ultra vires, as the law purported to grant monopoly of that trade to a few persons and this was inconsistent with article 19(1)(g) of the Constitution. Ratio |
This contention was negatived and this Court held that for the purpose of determining reasonable restrictions within the meaning of article 19(6) of the Constitution on the right given under article 19(1)(g), regard must be had to the nature of the business and the conditions prevailing in a particular trade. Ratio |
The State has certainly the right to prohibit trades which are illegal or immoral or injurious to the health and welfare of the public. Ratio |
The relevant portion of the judgment runs as follows: " Article 19(1)(g) of the Constitution guarantees that all citizens have the right to practise any profession or to carry on any occupation or trade or business, and clause (6) of the article authorises legislation which imposes reasonable restrictions on this right... |
It was not disputed that in order to determine the reasonableness (1) A.I.R. 1952 Orissa 42, (2) ; 724 of the restriction regard must be had to the nature of the business and the conditions prevailing in that trade. . Ratio |
It can also not be denied that the State has the power to prohibit trades which are illegal or immoral or injurious to the health and welfare of the public. Ratio |
Laws prohibiting trades in noxious or dangerous goods or trafficking in women cannot be held to be illegal as enacting a prohibition and not a mere regulation. Ratio |
" It is contended on behalf of the respondents that these observations clearly indicate that the expression "reasonable restriction" as used in article 19(6) of the Constitution might, in certain circumstances, include total prohibition. Ratio |
It may be mentioned here that the Excise Regulation is not a prohibitory statute which prohibits trading in liquor by private citizens altogether. Ratio |
It purports to regulate the trade in a particular way, namely, by putting up the right of trading in liquor in specified areas to the highest bidder in auction sale. Ratio |
The general observations occurring in the judgment cited above must therefore have to be taken with reference to the facts of that case. ' Be that as it may, although in our opinion the normal use of the word "restriction" seems, to be in the sense of "limitation" and not "extinction", we would on this occasion prefer ... |
If the word, "restriction" does not include total prohibition then the law under review cannot be justified under article 19(6). Ratio |
In that case the law would be void unless it can be supported by article 31. Ratio |
That point will be dealt with under the other point raised in the appeal. Ratio |
If however the word "restriction" in article 19(6) of the Constitution be taken in certain circumstances to include prohibition as well, the point for consideration then would be, whether the prohibition of the right of all private citizens to carry on the business of motor transport on public roads within the State of... |
As has been held by this Court in the case of Gooverjee vs The Excise, Commissioner, etc.(1) whether (I) ; 725 the restrictions are reasonable or not would depend to a large extent on the nature of the trade and the conditions prevalent in it. PRE |
There in nothing wrong in the nature of the trade before us, which is perfectly innocuous. PRE |
The learned Judges of the High Court have upheld the validity of the legislation substantially on two grounds. Ratio |
In the first place, they have relied on what may be said to be an abstract proposition of law, that prohibition with a view to State monopoly is not per se unreasonable. Ratio |
"In my opinion", thus observes one of the learned Judges, "even this total stoppage of trade on public places and thoroughfares cannot always be said to be an unreasonable restriction". Ratio |
In the second place, it has been said that the transport services are essential to the life of the community and it is conducive to the interests of the general public to have an efficient system of transport on public roads. Ratio |
It is pointed out that the preamble to the Act indicates that the legislation was ' passed in the interests of the general public who are undoubtedly interested in a suitable and efficient road transport service, and it was not proved by the petitioners that the monopoly, which was contemplated in favour of the State i... |
As a proposition of law, the first ground may not admit of any dispute but we think that the observations of Lord Porter in the Privy Council case of Commonwealth of Australia and Others vs Bank of New South Wales and Others (1) upon which considerable reliance has been placed by the High Court would indicate the prope... |
Every case must be judged,on its own facts and in its own setting of time and circumstance, and it may be that in regard to some economic activities and at some stage of social development it might be maintained that prohibition with a view to State monopoly was the only practical and reasonable (1) , 311.93 726 manner... |
In order to judge whether State monopoly is reasonable or not, regard therefore must be had to the facts of each particular case in its own setting of time and circumstances. Ratio |
It is not enough to say that as an efficient transport service is conducive to the interests of the people, a legislation which makes provision for such service must always be held valid irrespective of the fact as to what the effect of such legislation would be and irrespective of the particular conditions and circums... |
It is not enough that the restrictions are for the benefit of the public, they must be reasonable as well and the reasonableness could be decided only on a conspectus of all the relevant facts and circumstances. Ratio |
With regard to the second point also we do not think that the learned Judges have approached the question from the proper stand point. Ratio |
There is undoubtedly a presumption in favour of the constitutionality of a legislation. Ratio |
But when the enactment on the face of it is found to violate a fundamental right guaranteed under article 19(1)(g) of the Constitution, it must be held to be invalid unless those who support the legislation can bring it within the purview of the exception laid down in clause (6) of the article. Ratio |
If the respondents do not place any materials before the Court to establish that the legislation comes within the permis sible limits of clause (6), it is surely not for the appel lants to prove negatively that the legislation was not reasonable and was not conducive to the welfare of the community. Ratio |
In the present case we have absolutely no materials before us to say in which way the establishment of State monopoly in regard to road transport service in the particular areas would be conducive to the general welfare of the public. Ratio |
We do not know the conditions of the bus service at the present moment or the conveniences or inconveniences of the public in regard to the same; nor we are told how the position is likely to improve if the State takes over the road transport service and what additional amenities or advantages the general public would ... |
We mention these matters only to show 727 that these are relevant facts which might help the Court in coming to a decision as to the reasonableness or otherwise of the prohibition, but unfortunately there are no materials in the record relating to any one of them. Ratio |
One thing, however, in our opinion, has a decided bearing on the question of reasonableness and that is the immediate effect which the legislation is likely to produce. Ratio |
Hundreds of citizens are earning their livelihood by carrying on this business on various routes within the State of Uttar Pradesh. Ratio |
Although they carry on the business only with the aid of permits, which are granted to them by the authorities under the Motor Vehicles Act, no compensation has been allowed to them under the statute. Ratio |
It goes without saying that as a result of the Act they will all be deprived of the means of supporting themselves and their families and they will be left with their buses which will be of no further use to them and which they may not be able to dispose of easily or at a reasonable price. Ratio |
It may be pointed out in this connection that in Part IV of the Constitution which enunciates the directive principles of State policy, article 39(a) expressly lays down that the State shall direct its policy towards securing "that the citizens, men and women equally, have the right to an adequate means of livelihood. ... |
" The new clause in article 19(6) has no doubt been introduced with a view to provide that a State can create a monopoly in its own favour in respect of any trade or business; but the amendment does not make the establishment of such monopoly a reasonable restriction within the meaning of the first clause of article 19... |
The result of the amendment is that the State would not have to justify such action as reasonable at all in a Court of law and no objection could be taken to it on the ground that it is an infringement of the right guaranteed under article 19(1)(g) of the Constitution. Ratio |
It is quite true that if the present statute was passed after the coming into force of the new clause in article 19(6) of the Constitution, the question of reasonableness would not have arisen at all and the appellants ' case on this point, at any rate, would have been inarguable. Ratio |
These are however 728 considerations which cannot affect our decision in the present case. Ratio |
The amendment of the Constitution, which came later, cannot be invoked to validate an earlier legislation which must be regarded as unconstitutional when it was passed: As Professor Cooley has stated in his work on Constitutional Limitations(1) "a statute void for u`constitutionality is dead and cannot be vitalised by ... |
We think that this is sound law and our conclusion is that the legislation in question which violates the fundamental right of the appellants under article 19(1)(g) of the Constitution and is not shown to be protected by clause (6) of the article, as it stood at the time of the enactment, must be held to be void under ... |
We now come to the second point which is in a manner connected with the first and the question is: If the effect of prohibition of the trade or business of the appellants by the impugned legislation amounts to deprivation of their property or interest in a commercial undertaking within the meaning of article 31(2) of t... |
There is no doubt also that the appellants have been deprived of this interest. Ratio |
In the opinion of the High Court, in the circumstances of the present case, there is no scope for operation of article 31(2) of the Con stitution and the reason for taking this view is thus given in the judgment of one of the learned Judges: "The question is whether by depriving the private operators of their right to ... |
The vehicles which were being operated by the private operators have not been acquired by the State nor has any other tangible property which was used by the petitioners for their business been acquired. Ratio |
What has been done is that the petitioners have been prohibited from operating their buses on certain routes. Ratio |
This right of the petitioners has in no way been vested in the State inasmuch as the State always had an equal right with the petitioners to run their buses on these routes. Ratio |
" According to the High Court, therefore, mere depriv ation of the petitioners ' right to run buses or their interest in a commercial undertaking is not sufficient to attract the operation of article 31(2) of the Constitution as the deprivation has been by the authority of law within the meaning of clause (1) of that a... |
Clause (2) could be attracted only if the State had acquired or taken possession of this very right or interest of the petitioners or in other words if the right of the petitioners to run buses had been acquired by or had become vested in the Government. Ratio |
The State, it is pointed out, has an undoubted right to run buses of its own on the public thoroughfares, and they do not stand on the rights of the petitioners. Ratio |
This argument, we think, is not tenable having regard to the majority decision of this Court in the case of State of West Bengal vs Subodh Gopal Bose and Others (1) and Dwarkadas Shrinivas vs The Sholapur Spinning and Weaving Co. Ltd. (2). Ratio |
In view of that majority decision it must be taken to be settled now that clauses (1) and (2) of article 31 are not mutually exclusive in scope but should be read together as dealing with the same subject, namely, the protection of the right to property by means of limitations on the State 's powers, the deprivation co... |
The learned Advocate General co n. needed this to be the true legal position after the pronouncements of this Court referred to above. Ratio |
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