Judgment Rajesh Balia, J.-In these petitions the constitutional validity of Section 3 of Rajasthan co-operative Societies (Amendment) Ordinance, 2004 has been challenged. As per Section 3 of the Ordinance, sub-section (2-B) has been inserted in existing Section 30 of the Co-operative Societies Act, 2001. The impugned provision provides for contingency where before expiry of the term of the elected managing committee of any society, a new committee is not constituted. In such event, it enables the Govt. to direct the Registrar of Co-operative Societies to appoint a Government Servant as Administrator to manage the affairs of the society till a new committee is constituted provided that no member of the committee replaced by an administrator under this sub-section shall be deemed disqualified under Sub-section (5) of Section 28. 2. Under the parent Act before amendment also an Administrator could be appointed to take over the management of a society by removing the existing committee under Section 30 (1), but in that event the members of a committee removed under Section 30 become disqualified to be a member of a committee, as per Section 28 (5) of the Act. The Act also made provision for amalgamation of two or more co-operative societies under Section 13. 3. TheAct of 2001 was reserved for consideration of the President and had received assent of the President. In view thereot, such of the provisions of Act of 2001, which provides for any of the matters enumerated in Sub-clauses (a) to (e) of clause (1) of Article 31-A, including taking over management of property by the State were protected from being challenged on the ground of being inconsistent with Articles 14 and J9 of the constitution of India, notwithstanding declaration under Article 13 (2) of the Constitution. 4. In Daman Singh vs. State of Punjab, AIR 1985 SC 973 , the Co-operative Society has been held to be an entity falling within the purview of expression “cooration” under Article 31-A(1)(c), repelling the contention that protection afforded by Article 31-A (1) (c) of the constitution was not available to Co-operative Societies since the expression “corporation” did not comprehend Co- operative Societies within its’ expanse. 5. In all these petitions, the elections of the Managing Committee of the Co-operative Society concerned were held much prior to enactment of Rajasthan Co-operative Societies Act, 2001 which was brought into effect from 111.2002.
5. In all these petitions, the elections of the Managing Committee of the Co-operative Society concerned were held much prior to enactment of Rajasthan Co-operative Societies Act, 2001 which was brought into effect from 111.2002. Under the repealed law (The Cooperative Societies Act, 1965), the period of elected members of the managing committee was not prescribed under the Act but was left to be provided for under bye laws. As per bye laws approved, the period of managing committee was prescribed three years but they were to hold office until new committee was constituted. According to the repealed law there was no hiatus between the existing elected managing committee and new committee to be elected and it would continue to hold office until successor committee is elected to take over. Neither there was any provision for holding election of new committee well in advance before expiry of the term of existing committee, nor under the Act of 2001 it was envisaged, until Ordinance No. 1 of 2004 was promulgated, for such election in advance. 6. Unlike the repealed Act, under the new statute the term of elected members of a committee is provided five years under Section 32 itself No provisions are made, either under the Act or the Rules or bye laws, for continuance of the committee of elected members beyond the term of five years. Under the saving clause only such action taken under the repealed law were saved which are not inconsistent with the provisions of the Act of 2001. 7. Hence on commencement of New Act, life of the existing committee could not extend beyond five years of its existence. Since in respect of all the Co-operative Societies in question, period of five years had already expired since their constitution after the commencement of the Act, the term of existing committees had been extended but has not been extended after 2003. No election process had been initiated either under the provisions of the Act of 2001 so far by the general body or elected managing committee. 8.
No election process had been initiated either under the provisions of the Act of 2001 so far by the general body or elected managing committee. 8. TheOrdinance makes amendment, apart from the impugned provisions, also by substituting Chapter V of the Act of 2001 to provide for an elaborate procedure ensuring that elections of succeeding committee may be held prior to the expiry of the term of existing committee by mandating that the process for electing new committee be initiated at least six months prior to expiry of the term of existing committee. Simultaneously, the impugned Sub-section (2-B) in Section 30 was also inserted enabling the State Govt. to direct the Registrar for appointing Administrator, where the election for constituting new committee has not taken place, before the expiry of term of existing committee. 9. In the aforesaid circumstances, where the term of the elected committee has expired, without electing successor managing committee, in terms of such amendment, Administrator so appointed can continue until new committee is constituted. 10. Thecontention raised by the learned Counsel for the petitioners in these petitions is that the impugned provision suffers from vice of being inconsistent with Article 31-A(1) of the Constitution of India on two fold grounds; 11. First that the impugned provision provide for taking over the management of property of the co-operative society by the State within the meaning of sub Clause (b) of Clause (1) of Article 31-A of the Constitution of India. Under first proviso to Article 31-A(1) no such law can be made by the Legislature of the State, unless such law has been reserved for consideration of the President and has received his assent. Since the amending Ordinance of 2004 has not been promulgated under Instructions from President, the Ordinance is inoperative in view of first proviso to Article 31-A read with Clause (a) of proviso to Article 213. Secondly it has been contended that whereas, under Article 31-A(1)(b) taking over of management of property of cooperative society is permissible only for a limited period, the impugned provision does not provide for limit for which management of the society can be taken over. Hence, sub-section (2B) inserted in Section 30 of the Act of 2001 by the Ordinance transgresses the said limitation of constitution also. 10.12.
Hence, sub-section (2B) inserted in Section 30 of the Act of 2001 by the Ordinance transgresses the said limitation of constitution also. 10.12. The learned Counsel for the petitioners in support of his contentions placed reliance on the Bench decision of this Court in case of Dr. Han Singh vs. State of Rajasthan & Ors., and other connected matters 1991 (2) RLR 360. The aforesaid decision was rendered while considering like ordinance inserting like provision in Section 36 of the Rajasthan Co-operative Societies Act, 1965, which was repealed by the Act of 2001. 113. Thelearned Advocate General and Addl. Advocate General appearing for the State urged that first proviso to Article 31-A does not provide any restriction or limitation on competence of the State Legislature to legislate on the subject matter, in respect of which it otherwise has competence to legislate. The State Legislature is fully competent to legislate in the field of co-operative Societies and submitted that even if it provides for taking over of the management of property of the co-operative society temporarily in exercise of its legislative competence, that does not become invalid merely because it has not been reserved for consideration of the President and has not received the assent of the President. The effect of not reserving such law for consideration of the President or not receiving his assent would not affect the validity of the law on the ground of lack of’legislative competence or non-fulfilling the preconditions for legislating on the subject. Hence, it was not incumbent upon the Governor to have sought sanction of President before promulgation of Ordinance. For non-fulfilment of any condition of Article 31-A ot the Constitution, the amended provisions will not enjoy protection or immunity from being challenged on the anvil of being inconsistent with Article 14 or Article 19 of the Constitution and on such challenge being made, its validity could be tested on the touch-stone of well settled principle governing the requirement of Article 14 and 19 of the Constitution. Like any other law, no presumption exists about such law being violative of Article 14 and 19 per se. But if challenge is made, it has to be established by the person who challenges the validity of law on such grounds and Court is required to examine the challenge on merit.
Like any other law, no presumption exists about such law being violative of Article 14 and 19 per se. But if challenge is made, it has to be established by the person who challenges the validity of law on such grounds and Court is required to examine the challenge on merit. Law made in the field covered by Article 31-A fulfilling the conditions laid therein will make it immune from challenge on these limited grounds. But it is still open to challenge on grounds other than violation of Article 14 and 19, e.g. that the law is beyond the legislative competence of the Slate Legislature or for that matter such law is repugnant to law made by Parliament on a subject falling in concurrent List, or it violates any other provisions of the Constitution. 114. The basic premise of the contention raised by the petitioners in these petitions is decision rendered by this Court in Dr. Han Singh’s Case. The first enquiry which need be addressed is whether the answer to question raised before us is authoritatively provided by this Court in Dr. Han Singh’s Case as a binding precedent? 115. On a careful examination of Dr. Han Singh’s Case, we find that issues raised before us were neither raised nor even adverted to in said decision. In fact the conclusion was reached by the Bench on admissions and concessions made by the Counsel appearing for the State; and on assumption that for making any law in respect of any of the matters enumerated in Sub-clauses (a) to (e) of Article 31-A(1), assent of the President is pre- condition under first proviso to Article 31 -A( 1), and without such assent any law falling within Article 31 -A( 1) (a) to (e) cannot be enacted at all by State Legislature. Hence Ordinance impinging on such subject also needs instructions of President, which is apparent from the following statement made in the Judgment by the Court. 16. The contention was raised in the following terms: “Mr. Sharma appearing on behalf of the petitioners has argued that under Article 31-A it is necessary under Clause (b) of Clause (1) to obtain the assent of his Excellency the President of India.
16. The contention was raised in the following terms: “Mr. Sharma appearing on behalf of the petitioners has argued that under Article 31-A it is necessary under Clause (b) of Clause (1) to obtain the assent of his Excellency the President of India. He submits that Clause (b), provides that ‘notwithstanding contained in Article 13, no law for providing for the taking over of the management of any property by the State for a limited period either in the public interest or in order to secure the proper management of the property shall be valid unless such law having been reserved for consideration of the President, has received his assent. Where such law is made by the Legislature of the State the assent of the President is necessary.” 17. The respondents response noticed by the Court: “It is an admitted case of the parties that the ordinance has been issued without the assent of the President and it has not been referred for the consideration of the President in time. It is also an admitted position that earlier when the Act was enacted, it was submitted to His Excellency, the President for his assent and the President accorded assent and it was considered by the State Government that the assent of His Excellency, the President is necessary.” 18. The conclusion of the Court was recorded as under: “Even in subsequent amendments, the assent of His Excellency, the President was obtained. We are of the view that for ordinance to become an effective ordinance and a valid ordinance, it is necessary that the assent of the President should be obtained. Thus, there is a violation of the provisions of Article 213, as such, we hold that the ordinance No. 2 of 1990, issued on 31st August, 1990, is not a valid ordinance and it is invalid and ineffective only for the reason that the proviso to Article 213 relating to the assent of His Excellency, the President of India has not been followed and we declare that Section 36 (1) (b) is not a law or a valid amendment of the Act.” 19.
It is apparent from the above that because of the admitted stand taken by the parties on the contention raised by the petitioner, the Court without examining the issue whether Article 31-A requires as a legislative essential assent of the President for enacting any law by a State Legislature providing for acquisition or taking over the management of property for limited period and failure to do so renders the law as invalid as having been made without necessary required legislative process, or it merely takes away the applicability of Article 31-A and immunity from challenge to validity of such being inconsistent with Article 14 and 19 of the Constitution is not extended, which renders it vulnerable to challenge as being violative of Article 14 and 19, as any other law which is made by the State Legislature within the field reserved for its legislative authority ordinarily is, has held the Sub-section (1B) of Section 36 of the Co-operative Societies Act, 1965 to be violative of Article 213. However, requirement of reserving for President’s consideration and receiving his assent as necessary pre-condition for such legislative exercise has been assumed. In fact, though ground was raised that such enactment could not be validly enacted without reserving it for consideration of President and having received his assent as per Article 31-A, no answer to it was given by the Court. The conclusion rested on assumption that since the original enactment had been reserved for consideration of the President and had received his assent, and also the subsequent amendment of the Act of 1965 had been passed by the same process, in between amendment in the Act of 1965 vide Ordinance would also need President’s assent. However, no discussion or reasoning has preceded the said conclusion. 20. In other words, the Judgment by itself did not pronounce upon the contention of petitioners whether law falling within Act. 31 -A( 1) (b) if made by a State Legislature, will be stillborn until it complied with first proviso to Article 31-A (1), nor any consideration appears to have been given to reach conclusion whether before promulgating Ordinance containing a provision like impugned provision, sanction of the President was needed under any part of Article 213. 21.
31 -A( 1) (b) if made by a State Legislature, will be stillborn until it complied with first proviso to Article 31-A (1), nor any consideration appears to have been given to reach conclusion whether before promulgating Ordinance containing a provision like impugned provision, sanction of the President was needed under any part of Article 213. 21. Moreover, on the premise that the necessity of President’s assent has been founded is without it being brought to the notice of the Court contrary decisions of Supreme Court rendered considering first proviso to Article 31-A itself that where subsequent amendment has been reserved for assent of the President and receives his assent, extends the protection to earlier enactment which it seeks to amend, notwithstanding the earlier enactment has not been so reserved for consideration of the President and received his assent. .22. In Mahant Sankershan Ramanuja Das Goswami & Ors. vs. State of Orissa & Anr., AIR 1967 SC 59 , the Court said while considering the consideration of an amending enactment by President before assenting to it as per Article 31-A. .“It is to be presumed that President gives his assent to amending Act in its relation to the Act if sought to amend.” .23. Extending the principle in Venkatrao Esajirao Limbekar & Ors. vs. State of Bombay & Ors., AIR 1970 SC 126 , Hidayatullah, J. speaking for the Constitution Bench said: .“If the President has been accorded to the amending Acts, it would be difficult to hold that President had never assented to the Parent Act viz. Hyderabad Act No. XXI of 1950.” 4.24. It was a case in which Parent Hyderabad Act No. XXI of 1950 providing for acquisition of estate had not received assent of the President. However, the Maharashtra Act amending the Hyderabad Act has been reserved for consideration of the President and received his assent which was held to extend to existing Parent Act. 25. In Dr.
It was a case in which Parent Hyderabad Act No. XXI of 1950 providing for acquisition of estate had not received assent of the President. However, the Maharashtra Act amending the Hyderabad Act has been reserved for consideration of the President and received his assent which was held to extend to existing Parent Act. 25. In Dr. Han Singh’s case also, after the impugned amending Act has been made amending the Parent Act the Rajasthan Co-operative Societies Act, 1965, without assent of the President but to the subsequent amending Act, the President has according his assent, it inures for the principal Act as it exist on that date in view of the decision in Limbekar’s case (Supra), as it is presumed that such assent is accorded after considering the existing provisions of the Principal enactment including amendments upto that date. 26. Hence the decision in Dr. Han Singh’s case cannot be taken to be an authority for the contentious issue about the effect of non-reserving a law falling within the purview of Article 31-A(1) which is made by State Legislature for consideration of the President and receives his assent. In such circumstances, the decision in Han Singh’s case is of little assistance in providing answer to the question raised before us. 27. It has to be examined on the anvil of constitutional scheme of distribution of legislative authority and constraints, if any, which emanates from different provisions of the Constitution. 28. We have given our anxious consideration to rival contentions. 29. At the outset, we may notice some basic premise to be kept in view while considering question of Constitutionality of any enactment. There may be multiple grounds to challenge an enactment to be ultravires and inconsistent with some or other provisions of Constitution. 30. Part III of the Constitution containing Articles 12 to 35-A is dedicated to recognition of fundamental rights of polity of this nation. Supremacy of fundamental rights is ensured by ordaing in Article 13 that the State shall not make any law which takes away or abridges the rights conferred by Part III and any law made in contravention of the above mandate to the extent of contravention is held to be void. 4.31. The same infirmity was attached to the existing laws at the commencement of the Constitution to the extent they were inconsistent with the provisions of Part III. 5.32.
4.31. The same infirmity was attached to the existing laws at the commencement of the Constitution to the extent they were inconsistent with the provisions of Part III. 5.32. That being the reach of provisions contained in Part III, yet no-law made by any competent legislature is presumed to be inconsistent with any provision of Constitution unless it is so established and declared by any High Court or the Supreme Court, as the case may be. In other words, any law made by any Competent legislative act is not assumed to be in violation of any provisions of Part III of the Constitution, but any person making such claim has to seek the adjudication of such claim by appropriate proceedings. Burden is on the person who challenges the constitutional validity of any law being violative of any fundamental right guaranteed under any provision, to establish such violation before the Courts and declare the law to be ultra vires because of inconsistency with any provision of the Constitution. 6.33. In other words, with the declaration of the constitutional mandate under Article 13 that State shall not make any law which takes away or abridges the rights conferred by Part III and any law made in contravention of Clause (2) of Article 13 shall, to the extent of the contravention, be void, any law made by Parliament or State Legislature or by Subordinate legislative authority become vulnerable to judicial review on the ground that the law as a whole or any part of the provision of such enactment is void because it contravenes any of the provision of Part III of the Constitution which includes Articles 14 and 19 also. However, challenge to the constitutional validity of any law is not confined to it being made in contravention of Part III of the Constitution. 7.34. A law may be unconstitutional on a number of grounds.
However, challenge to the constitutional validity of any law is not confined to it being made in contravention of Part III of the Constitution. 7.34. A law may be unconstitutional on a number of grounds. For example, because it contravenes any fundamental rights specified in Part III of the Constitution or is a legislation on a subject which is not assigned to the relevant legislature by the distribution of power made in the 7th Schedule read with connected Articles or on the ground that it contravenes any of the mandatory provisions of the Constitution which imposes limitation upon the power of the legislature, for example Article 286 of the Constitution prohibits the State Legislature to impose or authorise imposition of taxes on the sale or purchase of goods where sale or purchase takes place outside the State or in the course of import of the goods or export of the goods out of the territory of India. It also abridges the power of the State Legislature to impose a tax on sale or purchase of goods in so far as it relates to goods declared by Parliament by Law to be of special importance in inter-State trade or commerce and making it subject to restriction in regard to the system of levy, rates and other incidents of tax as Parliament may by law speciir. 8.35. Part XIII envisaging under Article 301 freedom of trade, commerce and intercourse throughout the territory of India. It also contains provision making such freedom subject to reasonable restrictions that may be imposed in terms of Article 302 in public interest and Article 303 imposes restriction on the power of the Parliament or the State Legislature by prohibiting making of any law giving, or authorising the giving of , any preference to one State over another, or making, or authorising the making of , any discrimination between one State and another by virtue of enacting laws on the legislative field relating to trade and commerce. At the same time Article 304 enables Legislature of Slate to impose certain taxes and impose reasonable restrictions on such freedom but Bill or amendment in law can be made only after receiving previous sanction of the President. 9.36.
At the same time Article 304 enables Legislature of Slate to impose certain taxes and impose reasonable restrictions on such freedom but Bill or amendment in law can be made only after receiving previous sanction of the President. 9.36. Likewise, the constitutional validity of any provision of a Constitution may also be subject to challenge if it operates against the law made by the Parliament or is operative beyond the boundaries of the State. The legislation can also be subjected to judicial review if it suffers from vice of excessive delegation. 10.37. The challenge to the legislation is not confined to the precincts of contravention of the provisions of Part III of the Constitution but it is open to challenge on multiple grounds inviting invocation of one or more provisions of the Constitution having relevance to the subject mentioned. It is in this context, the legislation is also open to judicial review, if process of legislation does not conform to the procedure envisaged under the Constitution. 38. Presumption is always in favour of the Constitutionality of laws and the burden is upon the person who challenges its validity to show that there has been a clear transgression of the Constitutional principles. 39. Principle was stated by Supreme Court in Charanjit Lal Chowdhury vs. Union of India, AIR 1951 SC 41. FazlAli, J. opined: “that the presumption is always in favour of the constitutionality of an enactment and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles.” .40. In layingabove principle, the Court approved the accepted doctrine of American Courts and quoted with approval principle enunciated in Charlie Middleton vs. Taxas Power and Light Company, 248 U.S. 152: .“It must be presumed that a legislature understands and correctly appreciates the need of its own people, that its laws are directed to problems made manifest by experience and that its discriminations are based on adequate grounds.” .41. Privy Council stated the principle in Shell Company of Australia vs. Federal Commissioner of Taxation, (1931) AC 275 (PC) thus:- .“Unless it becomes clear beyond reasonable doubt that legislation in question transgresses the limits laid down by the organic law of the Constitution it must be allowed to stand as the true expression of the national will.” .42.
Privy Council stated the principle in Shell Company of Australia vs. Federal Commissioner of Taxation, (1931) AC 275 (PC) thus:- .“Unless it becomes clear beyond reasonable doubt that legislation in question transgresses the limits laid down by the organic law of the Constitution it must be allowed to stand as the true expression of the national will.” .42. The Supreme Court laid emphasis on presumption of constitutional validity of any enactment by assuming every state of facts which can be conceived existing at the time of legislation, in Ram Krishna Dalmia vs. Justice S.R. Tendolkar, AIR 1958 SC 538 , when it said .“that in order to sustain the presumption of constitutionality, the Court may take into consideration matters of common knowledge, matters of common report, the history of times and may assume every state of facts which can be conceived existing at the lime of legislation.” .43. Theprinciple was restated by Madholkar, J. in Burrakur Coal Company vs. Union of India, AIR 1961 SC 954 . Speaking for the Constitution Bench, he said:- .“Where the validity of a law made by a competent legislature is challenged in a Court of law, that Court is bound to presume in favour of its validity. Further while considering the validity of law the Court will not consider itself restricted to pleadings of the state and would be free to satisir itself whether under any provision of the Constitution the law can be sustained.” .44. The Principle stated above continued to be restated and reaffirmed by Apex Court in a recent decision in case of State of Bihar vs. Bihar Distillery Ltd., AIR 1997 SC 1511 , the Court reversing the Judgment of High Court spoke through B.P. Jeevan Reddy, J. :- .“The approach of the Court, while examining the challenge to the constitutionality of an enactment, is to start with the presumption of constitutionality. The Court should try to sustain its validity to the extent possible. It should strike down the enactment only when it is not possible to sustain it. The Court should not approach the enactment with a view to pick holes or to search for defects of drafting, much less inexactitude of language employed.
The Court should try to sustain its validity to the extent possible. It should strike down the enactment only when it is not possible to sustain it. The Court should not approach the enactment with a view to pick holes or to search for defects of drafting, much less inexactitude of language employed. Indeed, any such defects of drafting should be ironed out as part of the attempts to sustain the validity/constitutionality of the enactment The unconstitutionality must be plainly and clearly established before an enactment is declared as void.” 2.45. The present is a case in which the petitioners contend that pre-condition for making ordinance of the nature by the Governor of the State has not been fulfilled, hence, the impugned amendment must be treated as stillborn. The pre-condition which the petitioners allege has not been fulfilled is that, in order to make a law of the nature as the impugned provision of the ordinance is that it is required under the first proviso to Article 31-A that such law must be reserved for the consideration of the President and must have received his assent, if the law made by the Slate Legislature is to be valid, since it is a pre- condition required for enacting a law by legislature, it is also pre-requisite for making an ordinance by the Governor that he seeks instructions from the President before making the ordinance in terms of Article 213 of the Constitution. 3.46. Thevalidity of impugned provision has been challenged on the ground of defect in the process of making law. This question has two pronged thrust. Firstly, whether alleged defect has relation to scheme of distribution of legislative authority between Union and State. Secondly whether in the making of any such law any other pre-condition imposed by the Constitution has been breached. .47. Coming to the first aspect, the competence to make legislation on any subject matter by Parliament or by the State Legislature is a matter of distribution of legislative power in the federal structure of our Constitution and is further controlled by other provisions of the Constitution specifically providing the restraint on exercise of legislative power by the concerned legislative authority. Principally, 1st chapter of Part 11 captioned as deals with distribution of legislative power between Union and State.
Principally, 1st chapter of Part 11 captioned as deals with distribution of legislative power between Union and State. Broadly speaking, Article 245 states that Parliament may make law for whole or any part of territory of India and legislature of State may make law for the whole or any part of the State. Article 246 read with VII Schedule of the Constitution unfolds the scheme of distribution of legislative power between the Parliament and the State Legislature. List I of the 7th Schedule known as Union List enumerates subjects on which Parliament has .exclusive jurisdiction to make laws. List 2 of the VII Schedule, the State List, enumerates the matters on which State Legislature has exclusive jurisdiction to make laws and list 3, referred to as concurrent list in the VII Schedule, enumerates the matters on which both Parliament as well as State Legislatures are empowered to legislate. Any residuary subjects left out of three lists fall within the exclusive domain of Parliament for legislation that is made explicit by Article 248. In certain contingencies the Parliament has also been empowered under Article 249, 250, 251 and 252 to make laws in relation to matter falling in the State list. 4.48. Article 253 further empowers the Parliament exclusively to make any law for the whole or any part of territory of India fo