Discuss the principles of Constitutional Interpretation. Explain

Discuss the principles of Constitutional Interpretation. Explain, "In the interpretation of constitution, the judicial approach should be dynamic than static, pragmatic than pedantic, and elastic than rigid". Describe -  Harmonious Construction, Doctrine of Pith and Substance, Colourable Legislation, Proviso, Doctrine of Eclipse, Principle of separation. What is the proper function of a proviso? Can it affect the enacting portion of a section as well?

Introduction

Constitution is the supreme and fundamental law of our country. Since it is written in the form of a statute, the general principles of statutory interpretation are applicable to interpretation of the constitution as well. As is the case with any other statute, the court tries to find out the intention of the framers of the constitution from the words used by them. For example, in the case of State of Bihar vs Kameshwar Singh AIR 1952, SC used one of the standard principles of interpretation that where more than one reasonable interpretation of a constitutional provision are possible, that which would ensure a smooth and harmonious working of the constitution shall be accepted rather than the one that would lead to absurdity or give rise to practical inconvenience, or make well existing provisions of existing law nugatory, while interpreting the constitution.However, even if an argument based on the spirit of the constitution is very attractive, it must be validated with the spirit of the constitution as reflected by the words of the constitution. In the same case mentioned above, SC observed that spirit of the constitution cannot prevail if the language of the constitution does not support that view.

It is important to note that the constitution itself endorses the general principles of interpretation through Article 367(1), which states that unless the context otherwise requires, the General Clauses Act, 1897 shall apply for the interpretation of this constitution as it applies for the interpretation of an act of the legislature. Courts have ruled in cases such as Jugmendar Das vs State 1951, that not only the general definitions given in General Clauses Act, but also the general rules of construction given therein are applicable to the constitution.

Having said the above, the fact remains that Constitution is a special act. It is a fact that every provision of the constitution is constitutional and no part of it can be held unconstitutional. This casts an important duty on the interpreters of the constitution to interpret its provisions such that the spirit of the constitution is not maligned.  In Keshvananda Bharati vs State of Kerala, AIR 1973, SC identified the basic structure of the constitution that reflects its true spirit and held that nothing that hurts the basic structure of the constitution, is constitutional. In the same case, SC held that one should give the freedom to the parliament to enact laws that ensure that the blessings of liberty be shared with all, but within the framework of the constitution. It is necessary towards that end that the constitution should not be construed in a narrow and pedantic sense.

The letters of the constitution are fairly static and not very easy to change but the laws enacted by the legislature reflect the current state of people and are very dynamic. To ensure that the new laws are consistent with the basic structure of the constitution, the constitution must be interpreted in broad and liberal manner giving affect to all its parts and the presumption must be that no conflict or repugnancy was intended by its framers. Applying the same logic, the provisions relating to fundamental rights have been interpreted broadly and liberally in favor of the subject. Similarly, various legislative entries mentioned in the Union, State, and Concurrent list have been construed liberally and widely.

The following are some of the key principles applied specially in interpreting the provisions of the constitution -

Principle of Harmonious construction

Doctrine of pith and substance

Doctrine of Colourable legislation

Principle of Ancillary powers

Principle of Occupied field

Residuary power

Doctrine of repugnancy

Principle of Territorial Nexus

Doctrine of stare decisis

Doctrine of prospective overruling

Principle of Harmonious Construction

The principle of harmonious interpretation is similar to the idea of broad or purposive approach. The key to this method of constitutional interpretation is that provisions of the Constitution should be harmoniously interpreted. As per Kelly:

“Constitutional provisions should not be construed in isolation from all other parts of the Constitution, but should be construed as to harmonize with those other parts.” A provision of the constitution must be construed and considered as part of the Constitution and it should be given a meaning and an application which does not lead to conflict with other Articles and which confirms with the Constitution’s general scheme. When there are two provisions in a statute, which are in apparent conflict with each other, they should be interpreted such that effect can be given to both and that construction which renders either of them inoperative and useless should not be adopted except in the last resort.

This principle is illustrated in the case of Raj Krishna vs Binod AIR 1954. In this case, two provisions of Representation of People Act, 1951, which were in apparent conflict were brought forth. Section 33 (2) says that a Government Servant can nominate or second a person in election but section 123(8) says that a Government Servant cannot assist any candidate in election except by casting his vote. The Supreme Court observed that both these provisions should be harmoniously interpreted and held that a Government Servant was entitled to nominate or second a candidate seeking election in State Legislative assembly. This harmony can only be achieved if Section 123(8) is interpreted as giving the govt. servant the right to vote as well as to nominate or second a candidate and forbidding him to assist the candidate it any other manner.

Upon looking at various cases, the following important aspects of this principle are evident -

The courts must avoid a head on clash of seemingly contradicting provisions and they must construe the contradictory provisions so as to harmonize them.

The provision of one section cannot be used to defeat the provision contained in another unless the court, despite all its effort, is unable to find a way to reconcile their differences.

When it is impossible to completely reconcile the differences in contradictory provisions, the courts must interpret them in such as way so that effect is given to both the provisions as much as possible.

Courts must also keep in mind that interpretation that reduces one provision to a useless number or a dead lumbar, is not harmonious construction.

To harmonize is not to destroy any statutory provision or to render it otiose.

Doctrine of Pith and Substance

Pith means "true nature" or "essence" and substance means the essential nature underlying a phenomenon. Thus, the doctrine of pith and substance relates to finding out the true nature of a statute. This doctrine is widely used when deciding whether a state is within its rights to create a statute that involves a subject mentioned in Union List of the Constitution. The basic idea behind this principle is that an act or a provision created by the State is valid if the true nature of the act or the provision is about a subject that falls in the State list. The case of State of Maharashtra vs F N Balsara AIR 1951 illustrates this principle very nicely. In this case, the State of Maharashtra passed Bombay Prohibition Act that prohibited the sale and storage of liquor. This affected the business of the appellant who used to import liquor. He challenged the act on the ground that import and export are the subjects that belong in Union list and state is incapable of making any laws regarding it. SC rejected this argument and held that the true nature of the act is prohibition of alcohol in the state and this subject belongs to the State list. The court looks at the true character and nature of the act having regard to the purpose, scope, objective, and the effects of its provisions. Therefore, the fact that the act superficially touches on import of alcohol does not make it invalid.

Thus, as held in State of W Bengal vs Kesoram Industries, 2004, the courts have to ignore the name given to the act by the legislature and must also disregard the incidental and superficial encroachments of the act and has to see where the impact of the legislation falls. It must then decide the constitutionality of the act.

Principle of Incidental or Ancillary Powers

This principle is an addition to the doctrine of Pith and Substance. What it means is that the power to legislate on a subject also includes power to legislate on ancillary matters that are reasonably connected to that subject. It is not always sufficient to determine the constitutionality of  an act by just looking at the pith and substance of the act. In such cases, it has to be seen whether the matter referred in the act is essential to give affect to the main subject of the act. For example, power to impose tax would include the power to search and seizure to prevent the evasion of that tax. Similarly, the power to legislate on Land reforms includes the power to legislate on mortgage of the land. However, power relating to banking cannot be extended to include power relating to non-banking entities. However, if a subject is explicitly mentioned in a State or Union list, it cannot be said to be an ancillary matter. For example, power to tax is mentioned in specific entries in the lists and so the power to tax cannot be claimed as ancillary to the power relating to any other entry of the lists.

As held in the case of State of Rajasthan vs G Chawla AIR 1959, the power to legislate on a topic includes the power to legislate on an ancillary matter which can be said to be reasonably included in the topic.

The underlying idea behind this principle is that the grant of power includes everything necessary to exercise that power. However, this does not mean that the scope of the power can be extended to any unreasonable extent. Supreme Court has consistently cautioned against such extended construction. For example, in R M D Charbaugwala vs State of Mysore, AIR 1962, SC held that betting and gambling is a state subject as mentioned in Entry 34 of State list but it does not include power to impose taxes on betting and gambling because it exists as a separate item as Entry 62 in the same list.

Doctrine of Colourable Legislation

This doctrine is based on the principle that what cannot be done directly cannot be done indirectly. In other words, if the constitution does not permit certain provision of a legislation, any provision that has the same effect but in a round about manner is also unconstitutional. This doctrine is found on the wider doctrine of "fraud on the constitution". A thing is Colourable when it seems to be one thing in the appearance but another thing underneath.  K C Gajapati Narayan Deo vs State of Orissa, AIR 1953 is a famous case that illustrates the applicability of this doctrine. In this case, SC observed that the constitution has clearly distributed the legislative powers to various bodies, which have to act within their respective spheres. These limitations are marked by specific legislatives entries or in some cases these limitations are imposed in the form of fundamental rights of the constitution. Question may arise whether while enacting any provision such limits have been transgressed or not. Such transgression may be patent, manifest or direct. But it may also be covert, disguised, or indirect. It is to this later class of transgression that the doctrine of colourable legislation applies. In such case, although the legislation purports to act within the limits of its powers, yet in substance and in reality, it transgresses those powers. The transgression is veiled by mere pretense or disguise. But the legislature cannot be allowed to violate the constitutional prohibition by an indirect method. In this case, the validity of Orissa Agricultural Income Tax (Amendment) Act 1950 was in question. The argument was that it was not a bona fide taxation law but a colourable legislation whose main motive was to artificially lower the income of the intermediaries so that the state has to pay less compensation to them under Orissa Estates Abolition Act, 1952. SC held that it was not colourable legislation because the state was well within its power to set the taxes, no matter how unjust it was. The state is also empowered to adopt any method of compensation. The motive of the legislature in enacting a law is totally irrelevant.

A contrasting case is of K T Moopil Nair vs State of Kerala, AIR 1961. In this case, the state imposed a tax under Travencore Cochin Land Tax Act, 1955, which was so high that it was many times the annual income that the person was earning from the land. The SC held the act as violative of Articles 14 and 19(1)(f) in view of the fact that in the disguise of tax a person's property was being confiscated.

Similarly, in Balaji vs State of Mysore, AIR 1963, SC held that the order reserving 68% of the seats for students belonging to backward classes was violative of Article 14 in disguise of making a provision under Article 15(4).

What do you understand by Strict Construction

Q. What do you understand by Strict Construction? If there is an ambiguity in a word in a penal statute, what interpretation should be given and why? Explain why a taxing statute should be strictly constructed?

Strict Construction
Strict construction refers to a particular legal philosophy of judicial interpretation that limits or restricts judicial interpretation. Strict construction requires the court to apply the text as it is written and no further, once the meaning of the text has been ascertained. That is, court should avoid drawing inference from a statute or constitution. It is important to note that court may make a construction only if the language is ambiguous or unclear. If the language is plain and clear, a judge must apply the plain meaning of the language and cannot consider other evidence that would change the meaning. If, however, the court finds that the words produce absurdity, ambiguity, or a literalness never intended, the plain meaning does not apply and a construction may be made. Strict construction occurs when ambiguous language is given its exact and technical meaning, and no other equitable considerations or reasonable implications are made. Strict construction is the opposite of liberal construction, which permits a term to be reasonably and fairly evaluated so as to implement the object and purpose of the document.

Applicability in Penal Statutes
A Penal Statute must be constructed strictly. This means that a criminal statute may not be enlarged by implication or intent beyond the fair meaning of the language used or the meaning that is reasonably justified by its terms. It is fundamentally important in a free and just society that Law must be readily ascertainable and reasonably clear otherwise it is oppressive and deprives the citizen of one of his basic rights. An imprecise law can cause unjustified convictions because it would not be possible for the accused to defend himself against uncertainties. Therefore, an accused can be punished only if his act falls clearly into the four corners of the law without resorting to any special meaning or interpretation of the law. For example, in Seksaria Cotton Mills vs State of Bombay, 1954, SC held that in a penal statute, it is the duty of the Courts to interpret the words of ambiguous meaning in a broad and liberal sense so that they do not become traps for honest unlearned and unwary men. If there is honest and substantial compliance with an array of puzzling directions that should be enough, even if on some hyper critical view of the law other ingenious meanings can be devised.

If a penal provision is capable of two reasonably possible constructions, then the one that exempts the accused from penalty must be used rather than the one that does not. Whether a particular construction achieves the intention of the statute or not is not up to the court to think about in case of penal statutes. It is not apt for the court to extend the scope of a mischief and to enlarge the penalty. It is not competent for the court to extend the meaning of the words to achieve the intention of the legislature. If a penal provision allows accused to go scot-free because of ambiguity of the law, then it is the duty of the legislature and not of the courts to fix the law. Unless the words of a statute clearly make an act criminal, it cannot be construed as criminal. Chinubhai vs State of Bombay, AIR 1960, is an important case in this respect. In this case, several workers in a factory died by inhaling poisonous gas when they entered into a pit in the factory premises to stop the leakage of the gas from a machine. The question was whether the employer violated section 3 of the Factories Act, which says that no person in any factory shall be permitted to enter any confined space in which dangerous fumes are likely to be present. The Supreme Court, while construing the provision strictly, held that the section does not impose an absolute duty on the employer to prevent workers from going into such area. It further observed that the fact that some workers were present in the confined space does not prove that the employer permitted them to go there. The prosecution must first prove that the workers were permitted to enter the space to convict the accused.


Applicability in Taxing Statutes
Tax is the money collected from the people for the purposes of public works. It is a source of revenue for the government. It is the right of the govt to collect tax according to the provisions of the law. No tax can be levied or collected except by the authority of law. In general, legislature enjoys wide discretion in the matter of taxing statutes as long as it satisfies the fundamental principle of classification as enshrined in Article 14. A person cannot be taxed unless the language of the statute unambiguously imposes the obligation without straining itself. In that sense, there is no reason why a taxing statute must be interpreted any differently from any other kind of statute. Indeed, SC, in the case of CIT vs Shahazada Nand and Sons, 1966, observed that the underlying principle is that the meaning and intention of a statute must be collected from the plain and unambiguous expression used therein rather than any notions which be entertained by the Courts as to what is just or expedient. In construing a statutory provision the first and foremost rule of construction is the literary construction. All that the court has to see at the very outset is what does the provision say. If the provision is unambiguous and if from the provision the legislative intent is clear, the court need not call into aid the other rules of construction of statutes. The other rules of construction are called into aid only when the legislative intent is not clear.

Lord Russel in Attorney General vs Calton Ban, 1989, illustrated categorically as, "I see no reason why special canons of construction should be applied to any act of parliament and I know of no authority for saying that a taxing statute is to be construed differently from any other act."

However, as with any statute, a fiscal or taxing statute is also susceptible to human errors and impreciseness of the language. This may cause ambiguity or vagueness in its provisions. It is in such cases, the task of constructing a statute becomes open to various methods of construction. Since a person is compulsorily parted from his money due to tax, imposition of a tax is considered a type of imposition of a penalty, which can be imposed only if the language of the provision unequivocally says so. This means that a taxing statute must be strictly constructed. The principle of strict interpretation of taxing statutes was best enunciated by Rowlatt J. in his classic statement in Cape Brandy Syndicate v I.R.C. - "In a taxing statute one has to look merely at what is clearly said. There is no room for any intention. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. One can look fairly at the language used." If by any reasonable meaning of the words, it is possible to avoid the tax, then that meaning must be chosen. There is no scope for any inference or induction in constructing a taxing statute. There is no room for suppositions as to “spirit” of the law or by way of “inference”. When the provision is reasonably open to only one meaning then it is not open to restrictive construction on the ground that the levy of tax, is oppressive , disproportionate, unreasonable or would cause hardship. There is no room for such speculation. The language must be explicit. Similarly, penalty provision in a taxing statute has to be specifically provided and cannot be inferred.

In A. V. Fernandes vs State of Kerala, AIR 1957, the Supreme Court stated the principle that if the revenue satisfies the court that the case falls strictly within the provisions of the law, the subject can be taxed. If, on the other hand, the case does not fall within the four corners of the provisions of the taxing statute, no tax can be imposed by inference or by analogy or by trying to probe into the intentions of the Legislature and by considering what was the substance of the matter.

This does not mean that equity and taxation are complete strangers. For example, in the case of CIT vs J H Kotla Yadgiri, 1985, SC held that since the income from business of wife or minor child is includable as income of the assessee, the profit or loss from such business should also be treated as the profit or loss from a businesss carried on by him for the purpose of carrying forward and set-off of the loss u/s. This interpretation was based on equity. However, it does not permit any one to take the benefit of an illegality. This is illustrated in the case of CIT vs Kurji Jinabhai Kotecha,AIR 1977, where Section .24(2) of IT Act was constructed as not to permit assessee to carry forward the loss of an illegal speculative business for setting it off against profits in subsequent years. This proves that even a taxing statute should be so construed as to be consistent with morality avoiding a a result that gives recognition to continued illegal activities or benefits attached to it.

The rule of strict construction applies primarily to charging provisions in a taxing statute and has no application to a provision not creating a charge but laying down machinery for its calculation or procedure for its collection. Thus, strict construction would not come in the way of requiring a person claiming an exemption. The provisions of exemptions are interpreted beneficially.

What do you understand by Beneficial Construction?

Q. What do you understand by Beneficial Construction? Explain the statement, "Beneficial construction is a tendency rather than a rule".

A general rule of interpretation is that if a word used in a statute excludes certain cases in its common meaning, it should not be constrained unnecessarily to include those cases. An exception to this rule is that when the objectives of the statute are not met by excluding the cases, then the word may be interpreted extensively so as to include those cases. However, when a word is ambiguous i.e. if it has multiple meanings, which meaning should be understood by that word? This is the predicament that is resolved by the principle of Beneficial Construction. When a statute is meant for the benefit of a particular class, and if a word in the statute is capable of two meanings, one which would preserve the benefits and one which would not, then the meaning that preserves the benefit must be adopted. It is important to note that omissions will not be supplied by the court. Only when multiple meanings are possible, can the court pick the beneficial one. Thus, where the court has to choose between a wider mean that carries out the objective of the legislature better and a narrow meaning, then it usually chooses the former. Similarly, when the language used by the legislature fails to achieve the objective of a statute, an extended meaning could be given to it to achieve that objective, if the language is fairly susceptible to the extended meaning. This is quite evident in the case of B Shah vs Presiding Officer, AIR 1978, where Section 5 of Maternity Benefits Act, 1961 was is question, where an expectant mother could take 12 weeks of maternity leave on full salary. In this case, a women who used to work 6 days a week was paid for only 6x12=72 days instead of 7x12=84 days. SC held that the words 12 weeks were capable of two meanings and one meaning was beneficial to the woman. Since it is a beneficial legislation, the meaning that gives more benefit to the woman must be used.


It is said by MAXWELL, that Beneficial Construction is a tendency and not a rule. The reason is that this principle is based on human tendency to be fair, accommodating, and just. Instead of restricting the people from getting the benefit of the statute, Court tends to include as many classes as it can while remaining faithful to the wordings of the statute. For example, in the case of Alembic Chemical Works vs Workmen AIR 1961, an industrial tribunal awarded more number of paid leaves to the workers than what Section 79(1) of Factories Act recommended. This was challenged by the appellant. SC held that the enactment being a welfare legislation for the workers, it had to be beneficially constructed in the favor of worker and thus, if the words are capable of two meanings, the one that gives benefit to the workers must be used.

Similarly, in U Unichoyi vs State of Kerala, 1963, the question was whether setting of a minimum wage through Minimum Wages Act, 1948 is violative of Article 19 (1) (g) of the constitution because the act did not define what is minimum wage and did not take into account the capacity of the employer to pay. It was held that the act is a beneficial legislation and it must be construed in favor of the worker. In an under developed country where unemployment is rampant, it is possible that workers may become ready to work for extremely low wages but that should not happen.

PRESUMPTION REGARDING JURISDICTION

PRESUMPTION REGARDING JURISDICTION :

There is a strong presumption that a statute should not be given such an interpretation

as takes away the jurisdiction of the courts unless the language of the statute unambiguously so

states. The presumption is that since the legislature ordinarily does not intend that justice should

be out of bounds for the subjects, the courts must be presumed to have jurisdiction unless the

legislature by clear words or by clear necessary implications have ousted jurisdiction.

Since jurisdiction is bestowed in a court by legislation, legislation alone can take away

the same. The parties to a dispute can neither create by mutual consent jurisdiction of a court to

try their dispute nor can they take it away by mutual consent if in fact a court is vested with

jurisdiction in the matter. Mutual consent of parties, however, can create an arbitrator and the

arbitrator may be a judge also.

There is a strong presumption that civil courts have jurisdiction to decide all questions of

civil nature. The exclusion of jurisdiction of civil courts is therefore not to be readily inferred and

such exclusion must either be explicitly expressed or clearly implied. It is a principle by no

means to be whittled down and has been referred to as a fundamental rule. As a necessary

corollary of this rule, provisions excluding jurisdiction of civil courts and provisions conferring

jurisdiction on authorities and tribunals other than civil courts are strictly construed. The rule that

the exclusion of jurisdiction of civil courts is not to be readily inferred is based on the theory that

civil courts are courts of general jurisdiction and the people have a right, unless expressly or

implicitly debarred, to insist for free access to the courts of general jurisdiction of the State.

Indeed, the principle is not limited to civil courts alone, but applies to all courts of general

jurisdiction including criminal courts. Exclusion of jurisdiction of ordinary criminal courts can be

brought about by setting up courts of limited jurisdiction in respect of the limited field, only if the

vesting and the exercise of that limited jurisdiction is clear and operative and there is an

adequate machinery for the exercise of the limited jurisdiction. But the rule against exclusion of

jurisdiction of courts like other rules of construction is attached only where two or more

reasonably possible construction are open on the language of the statute and not where the

legislative intent is plain and manifest to oust the jurisdiction.


The Supreme Court stated that the first and the primary rule of construction is that the

intention of the legislature must be found in the words used by the legislature itself. If the word

used are capable of one construction only then it would not been open for the courts to adopt

any other hypothetical construction on the ground that such a construction is more consistent

with the alleged object and policy of the Act. The words used in the material provisions of the

statue must be interpreted in their plain grammatical meaning and it is only when such words

are capable of two constructions that the question of giving effect to the policy, or object of the

Act can legitimately arise. When the material words are capable of two constructions, one of

which is likely to defeat or impair the policy of the Act whilst the other is likely to assist the

achievement of the said policy, then the courts would prefer to adopt the latter construction. It is

only in such cases that it becomes relevant to consider the mischief and defect which the Act

purposes, to remedy and correct.


The superior court can in a proper case exercise its jurisdiction even in favour of a

petitioner who has allowed the time to appeal to expire or has not perfected his appeal, for

example, by furnishing security required by the statute, when an inferior court or tribunal by

discarding all principles of natural justice and all accepted rules of procedure arrived at a

conclusion which shocks the sense of justice and fairly or the inferior court or tribunal acts

wholly without jurisdiction or patently in excess of jurisdiction.

The Supreme Court has held the jurisdiction of the Court was not excluded and laid
down the following principles :

1. Where the state gives finality to the orders of the special tribunals the jurisdiction

of the civil court must be held to be excluded if there is adequate remedy to do what the civil

courts would normally do in a suit. Such provision, however, does not exclude those cases

where the provisions of the particular Act have not been complied with or the statutory tribunal

has not acted in conformity with the fundamental principles of judicial procedure.


2. Where there is an express bar of the jurisdiction of the court, an examination of

the scheme of the particular Act to find the adequacy or the sufficiency of the remedies provided

may be relevant but is not decisive to sustain the jurisdiction of the civil court, where there is no

express exclusion, the examination of the remedies and the scheme of the particular Act to find

out the amendment becomes necessary and the result of the inquiry may be decisive. In the

latter case, it is necessary to see if the statute creates a special right or a liability and provides

for the determination of the right or the liability and further lays down that all questions about the

said right and liability shall be determined by tribunals so constituted, and whether remedies

normally associated with actions in civil courts are prescribed by the said statute or not.


3. Challenge to the provisions of the particular Act as ultra vires cannot be brought

before the tribunals constituted under that Act. Even the High Court cannot go into that question

on a revision or reference from the decision of the tribunals.


4. Where a provision is already declared unconstitutional or the constitutionality of

any provision is to be challenged, a suit is open. A writ of certiorari may include a direction for

refund if the claim is clearly within the time prescribed by the Limitation Act, but it is not a

compulsory remedy to replace a suit.


5. Where the particular Act contains no machinery for refund of tax collected in

excess of the constitutional limits or illegally collected, a suit lies.


6. Questions of the correctness of the assessment apart from its constitutionalties

are the decisions of the authorities and a civil suit does not lie if the orders of the authorities are

declared to be final or there is an express prohibition in the particular Act in either case, the

scheme of the particular Act must be examined because it is a relevant inquiry.


7. An exclusion of the jurisdiction of the civil court is not to be readily inferred unless

the conditions above set down apply.


The Industrial Disputes Act, 1947 also furnishes an example of an Act which creates

new rights and obligations and provides machinery for adjudication of disputes pertaining to

them. The Supreme Court has held that if an industrial dispute relates to the enforcement of a

right or an obligation created under the Act then the only remedy available to the suit is to get an

adjudication under the Act. This case was followed in holding that for wrongs created by the Act

the only remedy is what is provided in the Act.

• PRESUMPTION REGARDING JURISDICTION
• CONSTRUCTION OF TAXING STATUTES
•  CONSTRUCTION TO PREVENT ABUSE IN INTERPRETATION OF STATUTES
• EVASION OF STATUTES – CONSTRUCTION TO PREVENT EVASION :
• LIBERAL CONSTRUCTION OF REMEDIAL STATUTES 
• STRICT CONSTRUCTION OF PENAL STATUTES

CONSTRUCTION OF TAXING STATUTES

CONSTRUCTION OF TAXING STATUTES :

The primary rule of construction of any taxing statute is that its plain, literal and

grammatical meaning should be taken, if that meaning is ascertainable. If the meaning be plain,

then there is no room for any rule of interpretation for, if meaning is clear and unambiguous then

that is the law. That is the golden rule. There is an important corollary to this golden rule, which

is of fundamental significance in the interpretation of taxing statutes.

From the rule of literal construction follows the rule of strict construction, which is often

deemed to be identical with it. However, we think that it is an independent principle which is

distinct though it arises directly form the aforesaid principle of literal construction – one relates

to the meaning, the other to its legal effect. The principle can be called the principle of strict

construction of taxing statutes and can be stated as follows :

If the meaning of a taxing statute is found to be unambiguous then that is the law. It must

be strictly applied. It must be applied irrespective of any consideration of equity, hardship,

difficulty, or illogicality, or of escapement. In other words, it rests on the supposition that if the

precise meaning is ascertainable on a liberal construction, then no other view of law is allowed

or is permissible.

Bhagwati, J. in A. V. Fernandez Vs. State of Kerala, AIR 1957 SC 657, stated the

principle as follows: “In construing fiscal statutes and in determining the liability of a subject to

tax one must have regard to the strict letter of the law. If the revenue satisfies the court that the

case falls strictly within the provisions of the law, the subject can be tax. If, on the other hand,

the case is not covered within the four corners of the provisions of the taxing statute, no tax can

be imposed by inference or by analogy or by trying to probe into the intentions of the Legislature

and by considering what was the substance of the matter.

Shah, J. in Sales Tax Commissioner Vs. Modi Sugar Mills, AIR 1961 SC 1047, has

formulated the principle thus: “In interpreting a taxing statute, equitable considerations are

entirely out of place. Nor can taxing statutes be interpreted on any presumptions or

assumptions. The court must look squarely at the words of the statute and interpret them. It

must interpret a taxing statute in the light of what is clearly expressed; it cannot imply anything

which is not expressed; it cannot import provisions in the statute so as to supply any assumed

deficiency.

If the words used are ambiguous and reasonably open to two interpretations, benefit of

interpretation is given to the subject. If the Legislature fails to express itself clearly and the tax-

payer escapes by not being brought within the letter of the law, no question of justness as such

arises. But equitable considerations are not relevant in construing a taxing statute, and similarly

logic or reason cannot be of much avail in interpreting a taxing statute.

The principle of strict construction applicable to taxing statutes does not, however, mean

that where the subject falls clearly within the letter of the law, the court can avoid the tax by

putting a restricted construction on some supposed hardship, or on the ground that the tax or

penalty imposed is heavy or oppressive. When the intention to tax is clear, it cannot be defeated

by a mere defect in phraseology on the ground that the provision could have been more

artistically drafted. The rule that where a literal interpretation leads to absurd or unintended

results, the language of the statute can be modified to accord with the legislative intention and

to avoid absurdity also applies in interpreting a taxing statute. Therefore, the rule, that object of

the Legislature has to be kept in view and a construction consistent with the object has to be

placed on the word used if there be ambiguity, is also applicable in construing a taxing

enactment.

Though equity and taxation are often strangers, attempts should be made that they do

not remain always so and if a construction results in equity rather than in injustice, then such a

construction should be preferred to the literal construction. Further, considerations of public

policy may also be relevant in interpreting and applying a taxing Act. Thus, it has consistently

been held that payments tainted with illegality cannot be treated as money wholly or exclusively

spent for the purpose of business for being allowed as a deduction in computation of profits of

the business for taxation under the Income Tax Act.

Again penal provisions enacted to meet tax evasion are subject to the rule of strict

construction and it is for the Revenue to prove that the conditions laid down for imposition of

penalty are satisfied. It must also be remembered that in applying a statute designed for

detection of fraud for example, one providing for search and seizure of tax-payer’s property two

competing public interest are involved: that offences involving tax frauds should be detected and

punished and that the right of the individual to the protection of law from unjustified interference

with his use and enjoyment of his private property should be upheld. If the statutory words are

ambiguous or obscure, a construction should be placed on them that is least restrictive of

individual’s rights. But a Judge should not be over-zealous in searching ambiguities or

obscurities in words which are plain simply because he is out of sympathy with the policy which

the Act appears to give effect.

The rule of strict construction does not negative the application of the well-known

principle that a person who claims an exemption has to establish it, and there is ample authority

for the view that this principle applies to exemptions granted in taxing laws as well. As regards

construction of exemption, an exemption in case of ambiguity should be liberally construed in

favour of the subject confining the operation of the duty. However, exemptions from taxation

have a tendency to increase the burden on the other members of society, and should, therefore,

be deprecated and construed in case of doubt against the subject. There can, however, be no

doubt that exemptions made with a beneficent object, e.g. to give incentive to cooperative

movement or for the purpose of developing urban or rural areas for public good, or for

encouraging investment in new machinery or plant have to be liberally construed. Similarly,

when a provision is made permitting concessional rate of tax for the purpose of encouraging an

industrial activity, the provision has to be liberally construed.

Whatever approach may be adopted in case of a real ambiguity, it is clear that there is

no justification for the view that if a word of exemption is not defined, it must be given its widest

meaning and the correct rule in construing words of exemption as in construing other word is to

find out the sense of the words in their context by reading the statute as a whole and by bearing

in mind the purposes of the statute and the consequences by flowing from rival interpretations.

The rule of strict construction does not permit the tax payer to take the benefit of an

illegality. That rule that a taxing Act is to be construed with strictness, is based on the principle

that inasmuch as there was not any a priori liability in a subject to pay any particular tax, nor any

antecedent relationship between the tax payer and the taxing authority no reasoning founded

upon any supposed relationship of the tax payer and the taxing authority could be brought to

bear upon the construction of the Act.

A penal provision in a taxing Act is not to be equated to a criminal statute requiring

impliedly the element of mens rea and unless there is something in the language of the Act

indicating the need to establish mens rea, it is generally sufficient to prove that a default in

complying with the provisions of the Act for which the penalty is imposed has occurred.

But provisions introduced to open up liability which had become barred by lapse of time,

will be subject to the rule of strict construction and will not be given larger retrospectively than

necessitated by express words of clear implication. Similarly, a limitation provision within which

steps have to be taken for recovery of duties not levied or not paid or short paid or erroneously

refunded, is subject to the rule of strict construction.

• PRESUMPTION REGARDING JURISDICTION
• CONSTRUCTION OF TAXING STATUTES
•  CONSTRUCTION TO PREVENT ABUSE IN INTERPRETATION OF STATUTES
• EVASION OF STATUTES – CONSTRUCTION TO PREVENT EVASION :
• LIBERAL CONSTRUCTION OF REMEDIAL STATUTES 
• STRICT CONSTRUCTION OF PENAL STATUTES

CONSTRUCTION TO PREVENT ABUSE IN INTERPRETATION OF STATUTES

CONSTRUCTION TO PREVENT ABUSE :

                      General principle of construction is that whenever a statute confers discretionary power

on an adjudicatory authority, it should be so construed that such discretionary power is not

abused. Thus authority whether it be administrative, quasi-judicial or administrative, upon whom

the discretionary power is conferred must exercise it in good faith and must taken in account the

object of the statute. As a matter of fact, discretionary power given to an authority by a statute

does not imply absolute of unqualified power, but implies a power exercised in accordance with

the rules of reason and justice.

Whenever a statute empowers exercise an authority to exercise discretion, the authority

must exercise it to achieve justice. However, the exercise of discretion must be fair and honest.

Where a power is deposited with a public officer for the purpose of being used for the benefit of

persons specifically mentioned and upon the conditions specifically provided for such persons

are entitled to call for the exercise of such discretionary power by that public offer and that

discretionary power ought to be exercised and the court will require it to be exercised.

Whenever a discretionary power is conferred upon any statutory authority, it must be exercised

reasonably and no authority is at liberty to decide what the law is according to their notion. In a

system governed by rule of law, discretion when conferred upon statutory authorities is deemed

to be conferred with clearly defined limits.

When actual power is different from that which is authorized by law, and that the

discretionary power is used ostensibly for the authorized but in reality for the unauthorized

purpose, such exercise of power is said to be ultra vires exercise of power. In Nalini Mohan Vs.

District Magistrate, AIR 1967 Cal 346, the High Court of Calcutta held an order ultra vires and

illegal because the power given by enabling statute for the purpose of rehabilitating the persons

displaced from their residence within the state as a result of communal violence was used for a

person who came from Pakistan due to communal riots in that country. Whenever an authority

exercises its discretion, it must be exercised in conformity with the spirit with which the statute

was enacted. As the basic principle of construction of any statute is to give effect to the intention

of the legislature and not to defeat it.

Statutes which confer powers on statutory authorities to adjudicate are so construed as

to meet all attempts to abuse these powers. In doing so, the judicial courts enquire into the bona

fide of a purported exercise of a statutory power. Accordingly, Maxwell opines that modern

tendency seems to be against construing statutes so as to leave the person or body upon whom

a power is conferred absolutely untrammeled in the exercise of it. It has been firmly established

that the discretionary powers given to the governmental or quasi-governmental authorities must

be hedges by policy, standards, procedural safeguards or guidelines, failing which the exercise

of discretion and its delegation may be quashed by the court.

The discretionary power conferred upon any authority under any statute must not be

construed as arbitrary fanciful which is influenced by extraneous considerations. In matters of

discretion, the choice must be dictated by public interest and must not be unprincipled or

unreasoned. The courts have laid down it clearly that before the exercise of discretion, the

authority must frame rules for the proper exercise of the discretion. Court have also emphasized

that even the power of the President or the Governor to grant pardon and to suspend, remit or

commute sentences or power of the Chief Minister to allot cement, plots or house from

discretionary quota or to make nominations to medical or engineering college must conform to

judicial norms.

• PRESUMPTION REGARDING JURISDICTION
• CONSTRUCTION OF TAXING STATUTES
•  CONSTRUCTION TO PREVENT ABUSE IN INTERPRETATION OF STATUTES
• EVASION OF STATUTES – CONSTRUCTION TO PREVENT EVASION :
• LIBERAL CONSTRUCTION OF REMEDIAL STATUTES 
• STRICT CONSTRUCTION OF PENAL STATUTES

EVASION OF STATUTES – CONSTRUCTION TO PREVENT EVASION :

EVASION OF STATUTES – CONSTRUCTION TO PREVENT EVASION :

It is permissible to evade an Act of Parliament in the sense that a person may not do that

which the Act prohibits but he is free to do anything which though equally advantageous to him

as that which is prohibited is nevertheless outside the prohibition, penalty or burden imposed by

the Act. It is well established that penal and taxing laws are not to be extended by analogy to

cover acts and situations not within the words of the state on any doctrine of substance of the

matter. But this principle has no application where what is done is really the thing prohibited

although under colour or cloak of different transaction not prohibited by the statute. It is not

permissible to evade an Act of Parliament by resorting to a fraudulent device or by covering the

reality by a non-genuine transaction. The word ‘evade’ is thus ambiguous and is used in two

senses, and in spite of various explanations given by the courts as to the two different meanings

of that word, the position is not very much different from what Lord Cranworth, LC found in

1855. Lord Chancellor said “I never understood what is meant by an evasion of an Act of

Parliament; either you are within the Act or you are not within it; if you are not within it you have

a right to avoid, to keep out of prohibition. A citizen is free to so arrange his business that he is

able to avoid a law and its evil consequences so long as he does not break that or any other

law. A blatant tax avoidance scheme which brings profit to a person cannot lead to the taxation

of the person on the ground that he has earned profit by trade unless his activities an the part

played by him in furtherance of the scheme amount to trade in the accepted sense or unless the

legislature enacts a special definition or provision to tax such activities. The taxing laws have

constantly been the subject of evasion in the sense of avoiding something disagreeable and

there are many dicta to the effect that a citizen is entitled to so arrange his affairs that the tax

burden does not fall on him and that there is nothing illegal or immoral in adopting such a

course.

Section 195, Code of Criminal Procedure, 1898, which provides that cognizance of

certain offences is not to be taken except on the complaint in writing made by the relevant court,

cannot be evaded by the device of charging a person with an offence to which that section does

not apply and then convicting him of an offence to which it does apply on the ground that the

latter offence is a minor one of the same character or by describing the offence as punishable

under some other section of the Penal Code, though in reality the offence falls in the category of

offences mentioned in Section 195.

The principle, that the courts can go behind the form and reach the reality, has to be

applied with certain reservations in determining correct amount of duty payable on documents

under the Indian Stamps Act, 1899. The duty being imposed on instruments and not upon

transactions, court can only construe the document as it stands for determining the proper

amount of duty, and although the name given to the document by the parties may not be

decisive of its character, it is not permissible to go behind the document and to hold an enquiry

as to the real nature of the transaction as distinguished from the real nature of the document.

On the general principle that when alternative constructions are open, a statute should be so

construed as to give effect to its object or policy, the courts to the extent the language permits,

will be slow to adopt such a construction which may lead to large scale evasion of the Act

resulting in its object being defeated.

• PRESUMPTION REGARDING JURISDICTION
• CONSTRUCTION OF TAXING STATUTES
•  CONSTRUCTION TO PREVENT ABUSE IN INTERPRETATION OF STATUTES
• EVASION OF STATUTES – CONSTRUCTION TO PREVENT EVASION :
• LIBERAL CONSTRUCTION OF REMEDIAL STATUTES 
• STRICT CONSTRUCTION OF PENAL STATUTES

LIBERAL CONSTRUCTION OF REMEDIAL STATUTES

LIBERAL CONSTRUCTION OF REMEDIAL STATUTES :

Every modern legislation is actuated with some policy and speaking broadly has some

beneficial object behind it. But then there are legislations which are directed to cure some

immediate mischief and bring into effect some type of social reform by ameliorating the

condition of certain class of person who according to present-day notions may not have been

fairly treated in the past. Such legislations prohibit certain acts by declaring them invalid and

provide for redress or compensation to the persons aggrieved. If a statute of this nature does

not make the offender liable to any penalty in favour of the State, the legislation will be classified

as remedial. Remedial statutes are also known as welfare, beneficial or social justice oriented

legislations.

Remedial statutes are one which remedy a defect in the pre-existing laws, statutory or

otherwise. Their purpose is to keep pace with the views of society. They serve to keep our

system of jurisprudence upto date and in harmony with new ideas or conceptions of what

constitutes just and proper human conduct. Their legitimate purpose is to advance human rights

and relationships. Unless they do this, they are not entitled to be known as remedial legislations.

Manifestly, a construction which far promotes improvement in the administration of justice and

the eradication of defects in our system of jurisprudence should be favoured over one which

perpetuates wrong.

Remedial statutes are liberally construed and in cases of doubt or ambiguity that

construction is adopted which will best advance the remedy provided and help to suppress the

mischief against which it was aimed. The words of a remedial statute must be construed so far

as they reasonably admit so as to secure that the relief contemplated by the statute shall not be

denied to the class intended to be relieved.

In construing a remedial statue the courts ought to give to it the widest operation which

its language will permit. The words of such a statute must be so construed as to give the most

complete remedy which the phraseology will permit, so as to secure that the relief contemplated

by the statute shall not be denied to the class intended to be relieved. In the field of labour and

welfare legislation which have to be broadly and liberally construed the Court ought to be more

concerned with the colour and content and the context of the statute rather than with its literal

import.

Equitable considerations may find an important place in the construction of beneficent

provisions particularly in the field of criminal law. The rule as stated and explained above only

means that if a section in a remedial statute is reasonably capable of two constructions that

construction should be preferred which furthers the policy of the Act and is more beneficial to

those in whose interest the Act may have been passed; and the doubt if any should be resolved

in their favour.

The provisions of a statute must be construed with reference to their context and with

due regard to the object to be achieved and the mischief to be prevented. Rent Control Act

should be interpreted reasonably and literally. They should be interpreted so as to give effect to

the objects of the statute and not to defeat them.

Even while giving liberal construction to socially beneficent legislation, if the language is

plain and simple, the working of law-making being a matter for the Legislature and not the

Courts, the Court must adopt the plain grammatical construction. The Court must take the law

as it is. And, accordingly, it is not entitled to pass judgment on the propriety or wisdom of

making a law in the particular form and further the Court is not entitled to adopt the construction

of a statute on its view of what Parliament ought to have done. However, when two

constructions are possible and legitimate ambiguity arises from the language employed, it is a

plain duty of the court to prefer and adopt that construction which enlarges the protection of a

protection of a socially beneficent statute rather than on which restricts it. In case of ambiguity, a

remedial should, however, be construed beneficially.

Equitable considerations may find an important place in the construction of beneficial

provisions particularly in the field of criminal law. In Bhagirath Vs. Delhi Administration, AIR

1985 SC 1050, the Supreme Court overruled its earlier decision and held that the beneficent

provisions of Section 428 of the Criminal Procedure Code directing set off of the period of pre-

conviction detention against the term of imprisonment is applicable even to cases where the

sentence is imprisonment for life and that such a sentence is also imprisonment for a term

within the Section.

• PRESUMPTION REGARDING JURISDICTION
• CONSTRUCTION OF TAXING STATUTES
•  CONSTRUCTION TO PREVENT ABUSE IN INTERPRETATION OF STATUTES
• EVASION OF STATUTES – CONSTRUCTION TO PREVENT EVASION :
• LIBERAL CONSTRUCTION OF REMEDIAL STATUTES 
• STRICT CONSTRUCTION OF PENAL STATUTES

STRICT CONSTRUCTION OF PENAL STATUTES

STRICT CONSTRUCTION OF PENAL STATUTES :

The general rule for the construction of a penal statute is that it would be strictly

interpreted, that is, if two possible and reasonable constructions can be put upon a penal

provision, the Court must lean towards that construction which exempts the subject from penalty

rather than the one which imposes a penalty.

A penal statute has to be construed narrowly in favour of the person proceeded against.

This rule implies a preference for the liberty of the subject, in case of ambiguity in the language

of the provision. The courts invariably follow the principle of strict construction in penal statutes.

In constructing a penal Act, if a reasonable interpretation in a particular case can avoid the

penalty the Court adopts that construction.

It is well settled that a penal statute must be strictly construed, that is to say, in the

absence of clear compelling language, the provision should not be given a wider interpretation

and “no cause should be held to fall within it which does not come within the reasonable

interpretation of the statute. If two conditions are possible on the language of the statute, the

court must choose the one which is consistent with good sense and fairness, and eschew the

other which makes its operation unduly oppressive or unreasonable or which would lead to

change, inconsistent results or otherwise introduce an element of bewildering uncertainty and

practical inconvenience in the working of the statute.

Normal rule in the construction of a penal statute is that if there is any ambiguity in the

language and a doubt arises as to whether a particular Act falls within the statutory provision or

not, the court should always interpret the words in favour of the accused.

The rule of strict construction of penal statutes is justified on the ground that the

enormous growth of penal laws in the present time may not become traps for honest and

unwary men through strict construction of a penal statute, which limits its operation to the clear

meaning of the language and excludes uncertainty in its application, injustice can be avoided.

There are some exceptions to the general rule of construction of penal statues: (1)

wherever the intention of the legislature is clear and it is found that by a narrower construction,

would lead to frustration of the very purpose of the statute, then there would be no objection that

a wide construction be given to the words, in accordance with the legislative intent; (2) when the

purpose is to remove a defect and achieve a certain object, the courts should not hesitate to

give a wide meaning to the words of a penal statute.

The rule of strict construction does not also prevent the court in interpreting a statute

according to its current meaning and applying the language to cover developments in science

and technology not known at the time of passing of the statute.

The ultimate object of construction either of a penal or of any other statute is to ascertain

the legislative intent. The rule of strict construction is not violated by permitting the words to

have their full meaning if that would effectuate the intention. The words as used in a penal

statue are taken in a wider sense than their etymological denotation may permit or meaning

which is colloquially or popularly attached to them. This is necessary to carry out the legislative

1. Mens rea in statutory offences:

Existence of a guilty intent is an essential ingredient of a crime at common law and the

principle is expressed in the maxim – actus non facit reum nisi mens sit rea. The legislature

may, however, create an offence of strict liability where mens rea is wholly or partly not

necessary. Such a measure is resorted to in public interest and moral justification of laws of

strict liability.  When a statute creates an offence, the question whether the offence involves the

existence of mens rea as an essential element of it or whether the statute dispenses with it and

creates strict liability are questions which have to be answered on a true construction of the

statute. The courts, however, regard it as a fundamental principle that an offence cannot be

made out without the existence of mens rea, unless from a consideration of the terms of the

statute and other relevant circumstances it clearly appears that that must have been the

intention of Parliament.

Offences in respect of which mens rea is not required to be established are usually of a

comparatively minor character and sentences prescribed for them are not of a severe type.

Therefore, the provision of a sentence of imprisonment or any other severe penalty may prima

facie indicate the mens rea, as a constituent part of the crime, was not intended to be excluded.

But it is not uncommon to find statutes concerning public health, safety and morals to provide

severe penalties for offences of strict liability.

Absence of the word ‘knowingly’ or some such other word expressing a guilty intention in

the relevant section of the statute and its presence in other sections or in other part of the same

section is not in itself conclusive to indicate that a guilty intention is excluded. But it is certainly a

material consideration and may in a proper case taken along with other relevant fact so to rebut

the presumption of existence of mens rea.

It has already been noticed that in applying the rule of construction under discussion,

regard must be had to the words of the statue and to the subject matter with which it deals. It is

pertinent also to enquire whether putting the defendant under strict liability will assist in the

enforcement of the statue, and where it can be shown that the imposition of strict liability would

result in the prosecution and conviction of a class of persons whose conduct could not in any

way affect the observance of the law, even where the statute is dealing with a grave social evil

strict liability is not likely to be intended.

The Supreme Court in Kalpnath Rai Vs. State, AIR 1998 SC 201, considered section

3(4) of the Terrorists and Disruptive Activities (Prevention) Act, 1987. This section enacts that

‘whoever harbours – any terrorist’ shall be punishable with imprisonment which shall not be less

than five years but which may extent to imprisonment for life. The court held that the section

provided for harsh punishment could not be held to have excluded mens rea; and a person

giving shelter to a terrorist without knowing that he was a terrorist could not be punished under

section 3(4).

Prohibitory laws are enforced if the statute required the offenders violating the law

whether knowingly or unknowingly must be brought to book. The statutes regulating particular

activities for public welfare like sale of food, drinks out the presumption of mens rea, as it has

been frequently inferred that the legislature intends such activities to be carried out under

conditions of strict liability.

The intention of legislature as evident from the language of the prevention of Food

Adulteration Act is to provide for strict liability. Therefore, every person selling adulterated food

commits an offence under this Act whether he had the guilty intention or not.

2. Vicarious liability in statutory offences :

The general presumption is that the master is not criminally liable for any act committed

by the servant, unless the legislature prohibits the act and imposes an absolute duty. The

general rule is that ‘criminal liability in a matter that might result either as a principal or as an

accessory springs from the authorization and not simply from the relationship of a master and

servant.

While prima facie a principal is not to be made criminally responsible for the acts of his

servants, yet the Legislature may prohibit an act or enforce a duty in such words as to make the

prohibition or the duty absolute; in which case the principal is liable if the act is in fact done by

his servants. To ascertain whether a particular Act of Parliament has that effect or not, regard

must be had to the object of the statute, the words used, the nature of the duty laid down, the

person upon whom it is imposed, the person by whom it would in ordinary circumstances be

performed, and the person upon whom the penalty is imposed. It may also be that the statutory

provision is so drafted that it only makes the employer liable for the offence but does not make

the employee liable for whose act or default the employer is made liable. Further, where the

nature of the activity makes the premises, where it is carried on, a major hazard site, Parliament

may impose upon the employer a duty, failure of which makes him liable for a criminal offence,

‘to conduct his undertaken in such a way’ that subject to reasonable practicability, it did not

create risks to people’s health and safety and the employer may become liable for the offence

irrespective of the question that the risk originated not because of some lapse of his employee

but because of the lapse of some other person over whom he had no control. In such cases the

statute makes the employer liable for the offence, though he has personally no mens rea or has

not committed any actus reus, as the duty is laid on the employer himself by reference to a

certain kind of activity carried on by him. This duty is conceptually entirely different from the

vicarious liability for the tortuous acts of his servants and agents.

• PRESUMPTION REGARDING JURISDICTION
• CONSTRUCTION OF TAXING STATUTES
•  CONSTRUCTION TO PREVENT ABUSE IN INTERPRETATION OF STATUTES
• EVASION OF STATUTES – CONSTRUCTION TO PREVENT EVASION :
• LIBERAL CONSTRUCTION OF REMEDIAL STATUTES 
• STRICT CONSTRUCTION OF PENAL STATUTES

REPEAL OF A STATUTE :

REPEAL OF A STATUTE :

A power to make a law with respect to the topics committed to parliament or state

legislature carries with it a power to repeal a law on those topics. Subject to any constitutional

restriction, the general rule is that “the power of a legislative body to repeal a law is co-extensive

with its power to enact such a law,” and a legislature which has no power to enact a law on a

particular subject-matter has also no power to repeal the same. If parliament chooses, in a

subsequent act, to make it perfectly plain that the previous one is being to some extent repealed

or abrogated, that must have effect, because it is the will of the legislature.

An act, therefore, may be repealed by a later “distinct and repealing enactment or an

enactment inconsistent and irreconcilable therewith”. In other words no repeal can be brought

about “unless there is an express repeal of an earlier act by the later act, or unless the two acts

cannot stand together”. A repeal may thus be by express words of a later statute, or may be

implied on considerations of inconsistency, or irreconcilability of the provisions of an earlier

statute, with those of a later statute. A power ‘to amend or repeal’ will, therefore, imply a power

to amend or repeal by implication, i.e., by making inconsistent laws.

Repeal by implication – A repeal by implication takes place when (a) the subsequent act

is so inconsistent or irreconcilable with an existing prior act that one of the two can remain in

force or (b) an act covers the whole subject of an earlier act and is intended to be substituted.

The validity of such a repeal is sustained on the ground that the last expression of the legislative

will should prevail.

It is a well recognized principle of interpretation of statutes that an enactment or rule

having the force of law cannot be held to be repealed by implication by a later enactment or

statutory rule unless the provisions of the earlier enactment or rule are plainly repugnant to

those of the subsequent enactment or rule and the entire subject-matter of the first is taken by

the subsequent enactment. Repeal by implication is the consequent of contradictory or

inconsistent legislation and should not be imputed to legislation or rule making authority unless

one is driven to do so. Where a later enactment or a subordinate legislation is so inconsistent

with or repugnant to an earlier enactment or subordinate legislation that the two cannot co exist,

then the latter one would effect repeal of the former by implication (Dharan Gadhara Chemical

Works v. Dhardngadhra Municipality and Another (1985 4 S.C.C. 91).

The general rule is that the repealing act are unless the contrary intention appears, (i)

not to affect the previous operation of any enactments so repealed or anything duly done under

any enactment so repealed (ii) not to affect any privilege, right, obligation or liability acquired,

accrued or incurred under any enactment so repealed or (iii) not to affect any penalty, for failure

or punishment incurred in respect of any offence committed against any enactment so repealed”

or (iv) not to effect any investigation, legal proceeding or remedy in respect of any such right,

privilege, obligation; liability, penalty of forfeiture aforesaid.

The repeal of any act does not necessarily result in the repeal of the rules. The rules and

regulations do not lose their character as rules and regulations, even though they are to be of

the same effect as if contained in the act.

The general rule of repeal that when a parent act is repealed, all laws made thereunder

stand repealed does not apply to laws made under a constitution act, such a law has to be

expressly repealed. It has to be effected. In the case of subordinate legislation, the emanating

law dies unless saved, but a new law made under a constitution act survives will expressly

repealed.

COMMENCEMENT OF A STATUTE

COMMENCEMENT OF A STATUTE :

Commencement, used with reference of an act, means the day on which the act comes

into force. Unless provided otherwise, a central act comes into operation on the day it receives

the Presidential assent and is construed as coming into operation immediately on the expiration

of the day preceding its commencement. Thus, if a central act is assented to by the President

on 26th January at 10.30 a.m., it would be construed to have come into operation on the mid-

night between 25th and 26th January.

Under the various state general clauses acts a state act comes into force on the day

when the assent of the Governor or the President, as the case may be, is first published in the

Official Gazette of the state.

An act cannot be said to commence or to be in force unless it is brought into operation

by legislative enactment or by the exercise of authority by a delegate empowered to bring it into

operation.

An act not applicable to an area or a state cannot be made to apply there by judicial fiat

but if a provision in such an act embodies a principle of justice, equity or good conscience the

principle so embodied may be applied to a case arising from an area or state to which the act

does not extend, if the fact situation of the case so requires.

EXPRESIO UNIUS EXCLUSION ALTERIUS

EXPRESIO UNIUS EXCLUSION ALTERIUS :

Meaning and its application:- This maxim means that mention of one or more things of a

particular class may be regarded as excluding all other members of that class. Further more,

when an act used two words, one of which includes the other, the more general one would

naturally exclude the less general one.

An illustration of the application of this maxim in an Indian case may be cited. In

considering the applicability of the maxim to sections 68 and 87 of the Bombay District

Municipality, it was observed by the HC of Bombay that the rule is not of universal application

and it cannot be applied unless the statute by its language shows all things different in genus

and description from those which are enumerated are intended to be excluded. When the act

gives general powers to the Municipality to fix the amount or rate at which it desires to make the

class or classes of persons or property habile: it is not proper to suggest that, because some

specific instances are enumerated wherein it is said that the municipality can impose rates upon

certain basis, such enumeration has the effect of limiting municipality’s choice of the basis upon

which the taxes can be levied. It was accordingly held that eh aforesaid sections were not

intended to deal only with the tax specified in section 59 9a) (i) of the act, but covered also any

other tax which was imposed in the form of a rate on buildings or lands (Shidrao v. municipality

of Athni, A.I.R. 1943 Bom. 21.)

The gist of the decision on the case is that this rule has no application where it would

lead to inconsistency and injustice and would make the provision of the statute in question

uncertain and capricious in its operation.