INTRODUCTION

ACTS, BILLS AND STATUTES

 A Bill is one that has been proposed by the legislature, but not approved by the President or the Governor. The
proposal does not have legal sanction.
 Once it gets approved by either the President or the Governor, it becomes an Act. The legal repercussion of this
approval is enforceability.
 A Statute is the written form of legal sanction given by the legislature. It is something specific. An Act is a
bigger sub-set and has a wider scope.

INTERPRETATION AND CONSTRUCTION

 The judge has to interpret the law and apply it on the given case. Problem of interpretation arises because of
ambiguity in drafting, not in the legislation.
 Interpretation refers to simple linguistic meaning. The intention of the legislature is to be determined. The
objective of the legislature is to be determined – we need to look at the legal effect of the law.
 For instance, India was the first country to make CSR mandatory – 2% of the income needs to go towards your
CSR. That is the plain meaning of the section. Now if Ambani puts 2% towards setting up of a school for
children from privileged families, technically, all the boxes have been ticked. However, we need to look at the
purpose behind the insertion of CSR into the Companies Act – which was welfare of those who need it. This is
why we need construction.
Need for interpretation
 The ambiguity of the words used in the statute: Sometimes there will be words that have more than one
meaning. And it may not be clear which meaning has to be used. There could be multiple interpretations
made out of it.
 Change in the environment: We all know that society changes from time to time and there may be new
developments happening in a society that is not taken into consideration, this lacks the predictability of the
future event.
 Complexities of the statutes: usually statutes are complex and huge, it contains complicated words, jargon
and some technical terms which are not easy to understand and this complexity may lead to confusion.
 When legislation doesn’t cover a specific area: Every time when legislations are out it doesn’t cover all the
area it leaves some grey areas and interpretation helps in bridging the gaps between.
 Drafting error: The draft may be made without sufficient knowledge of the subject. It may also happen due
to the lack of necessary words and correct grammar. This makes the draft unclear and creates ambiguity in
the legislature.
 Incomplete rules: There are few implied rules and regulations and some implied powers and privileges
which are not mentioned in the statute and when these are not defined properly in the statute this leads to
ambiguity.

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 

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 THE FIVE GUIDING PRINCIPLES

MEANING OF INTERPRETATION AND CONSTRUCTION

According to Salmond, interpretation and construction refer to the process by which courts seek to ascertain the
meaning of the legislature through the medium of authoritative forms in which it is expressed.

Cooley distinguishes the two terms:

 Interpretation is the art of finding out the true sense of any form of words, i.e., the sense which the author
intended to convey, and of enabling others to derive from them the same idea which the author intended to
convey.
 Construction is the drawing of conclusions, respecting subjects that lie beyond the direct expression of the text
and arriving at conclusions which are in the spirit though not within the letter of the law.

Interpretation helps in determining the real meaning and intention of the legislature. It is the process adopted by the
courts to determine the meaning of the legislature by way of legislative form. It tends to clarify the meaning of
those terms which are difficult to understand.

On the other hand, construction is used to ascertain the legal effect of the legal text. It determines the sense and
explanation of abstruse terms and draws a conclusion with respect to the subject that lies above the direct
expression of the legal text.

Basis for
Interpretation Construction
Comparison

Identification of the true Drawing inferences about the subject that are beyond the
Meaning
sense of the statute. direct expression of the text.

Determines Linguistic meaning. Legal effect.

The court complies with the Literal meaning of the words used in the legal text exhibits
Used when simple meaning of the legal ambiguous meaning and the court has to decide whether the
text. words used in the legal text cover the case or not.

However, this distinction has been largely relegated to the realm of academic discussion and has been criticised as
erroneous. In common usage, interpretation and construction are usually understood as having the same
significance.

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INTENTION OF THE LEGISLATURE
 A statute is an edict (declaration) of legislature and the conventional way of interpreting or construing a statute
is to see the intention of the maker.
 A statute is to be construed according to the intent of those who make it and the duty of the judicature is to act
upon the true intention (mens or sententia legis) of the legislature.
 The spirit of a statute needs to be culled out by looking at its object. Preambulatory clauses of Acts help in
doing so. Constitutional Assembly Debates can also pay an important role in some cases.
 The intention of the legislature has two aspects:
– One aspect carries the concept of ‘meaning’, i.e., what the words mean.
– The other conveys the concept of purpose and object or reason and spirit prevailing in the statute.
 Some examples of this doctrine are as follows:
– The Mental Health Bill it an act now in 2017 was introduced with the intention of bringing about
awareness. They have failed at this objective because the Bill understanfds mental health only in the
clinical sense.
– A Bill was introduced in the aftermath of the Kathua rape case, the intention of which was punishment.
However, the concern of the victim was betrayed because death penalty was prescribed for cases of rape
of a minor.
– Principles enshrined in the Convention on Elimination of Discrimination Against Women (CEDAW) were
incorporated into the Vishakha guidelines, which were then codified into law.
– The intention of the CSR Act was the welfare of the people.

A STATUTE MUST BE READ AS A WHOLE IN ITS CONTEXT

 When interpreting a law, you have to see the previous statute and any supplementary rules in entirety. You
have to look into the changes made and also the reason why the previous Act was repealed.
 The Latin maxim ‘ex visceribus actus’ means that the words in a statute often take the meaning from the
context of the statute as a whole. They are, therefore, not to be construed alone.
 Example: Company law. Change in the definition of control – why? Look at whole context, the previous acts as
well as the supplementary rules.
Case laws: Case laws
 Bhatia Case
 Bharat Aluminium Co v. Kaiser Aluminium Technical Services Inc106(BALCO) ( purpose of the
act and read the act in whole context in alignment with intention of the act (UNICTRAL Model))
( The judgement prospectively insulates arbitrations seated outside India and foreign awards
from the unwelcome interference by the Indian courts)

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 Judicial intervention has been rendered minimal, this being the basic underlying objective of the ACA,
1996.
Purpose and objective: 1. Non- interference by the judiciary in arbitral proceedings is a fundamental
theme of 1996 Act
2. there is only supervisory role of the Indian courts in setting aside the award under sec34 of ACA 1996
( setting aside of the award in conflict with public policy)
3. International commercial arbitration in India is regulated by the Arbitration and Conciliation Act
1996 (the “Arbitration Act”). The Arbitration Act is divided into two parts: Part I provides a framework
of rules for domestic arbitrations, that is, any arbitration seated in India, including an arbitration
involving a foreign party but seated in India; and Part II provides rules for the recognition and
enforcement of foreign arbitral awards, that is, those resulting from arbitrations seated outside India
whether or not an Indian party is involved.
The Arbitration Act closely follows the UNCITRAL Model Law on International Commercial
Arbitration which provides a suggested legal framework for international arbitration which respects
party autonomy and places limits on the extent to which local courts may interfere in the arbitral
process, particularly in relation to arbitrations held in other jurisdictions.
4. However, in a series of decisions the Indian courts severely eroded this principle of non-intervention.
In particular, the Supreme Court’s own 2002 decision in Bhatia International v Bulk Trading S.A.
(“Bhatia International”)3 found that Part I of the Arbitration Act applied equally to arbitrations held
outside India, thereby justifying higher levels of court intervention (which was neither the purpose or
objective of the 1996 Act, the very act was brought into picture and repealed the 1940 act because there
was lot of intervention by the judiciary of India in arbitral proceedings). In another decision, the Court
held that any foreign arbitral award that contravened Indian law was illegal and liable to be set aside on
the grounds of public policy.
The net effect of these decisions was that the Indian courts had the power to reopen and review any
foreign arbitral award, whether seated within India or not and whether or not a party was seeking to
enforce that foreign award in India. As a result of this approach, parties who had agreed to resolve their
disputes by arbitration in, for example, Singapore could nonetheless be dragged into legal proceedings
before the Indian courts even before any attempt at local enforcement was made. This approach was the
source of considerable concern amongst foreign parties engaged in commercial transactions in India and
had attracted substantial criticism from lawyers and academics in India and elsewhere.
Facts( BALCO CASE)
The parties had entered into an agreement in relation to the supply of equipment, modernization and
upgradation of production facilities. Certain disputes arose and were referred to arbitration seated in
England and awards were made in favour of the Respondent. The Appellant had filed applications to set
aside the award before the Chhattisgarh High Court under Section 34 of the Act (which falls under Part
I dealing with domestic arbitrations or foreign arbitration if the seat of arbitration is in India).
Relevant Clauses of the Agreement
Article 17 - Arbitration
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 17.1 Any dispute or claim arising out of relating to this agreement shall be in the first instance endeavor
to be settled amicably by negotiation between the parties hereto and failing which the same will be
settled by arbitration pursuant to the English Arbitration Law ( parties autonomy very important for
ACA 1996)and subsequent amendment thereto.
17.2 The arbitration proceedings shall be carried by two arbitrators, one appointed by the Petitioner and
one by the Respondent chosen freely and without any bias. The Court of arbitration shall be wholly in
London, England and shall use the English language in the proceedings. The finding and award of the
Court of Arbitration shall be final and binding.
17.3 Before entering upon the arbitration, the two Arbitrators shall appoint an Umpire. If the two
arbitrators are not able to reach an agreement on the selection of an Umpire, the Umpire shall be
nominated by the International Chamber of Paris.
Article 22 - Governing Law
This agreement will be governed by the prevailing law of India and in case of Arbitration, the English
Law shall apply.
The aforesaid clause itself indicates that by reason of the agreement between the parties, the governing
law of the agreement was the prevailing law of India. However, the settlement procedure for
adjudication of rights or obligations under the agreement was by way of arbitration in London and the
English Arbitration Law was made applicable to such proceedings. Therefore, the lex fori for the
arbitration is English Law but the substantive law will be Indian Law.
Judgment [BALCO II]
The court held that Article 22 is clear in providing that the proper law of the contract is Indian law.
They further held that Article 17.1 provided for English law to be the law applicable to the arbitration
agreement. Therefore, the court found that English law was the law applicable to the arbitration
agreement. In light of the same, the court upheld the decision of the High Court dismissing the Section
34 applications.
Analysis
The court read the arbitration clause in light of "party autonomy" being the "grundnorm" of
international commercial arbitration and stated that when interpreting such an agreement, it must be
kept in mind that parties would have intended to avoid impracticable and inconvenient processes and
procedures. The court therefore found that the proper law of contract was clearly Indian law while
English law was only the law governing the arbitration agreement.
 In Bharat Aluminium the Supreme Court found that by adopting the UNCITRAL Model Law the Indian
legislature had accepted the territorial principles contained within the Model Law. According to those
principles, the “place” or “seat” of the arbitration agreed by the parties to an arbitration agreement provides the
law governing that arbitration. The Court accepted that the Arbitration Act distinguished between domestic
awards, as those rendered by arbitral tribunals seated within India, and foreign awards, as those rendered by
tribunals seated in other jurisdictions. The Court confirmed that Part I of the Arbitration Act, and the intrusive
powers it gives to the courts, only applies to arbitrations seated in India.

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 Provisions of Part I and Part II do not overlap and Part II is not merely supplementary. There is complete
segregation between them as Part I deals with all four phases of arbitration-commencement, conduct, challenge
and recognition and enforcement while Part II pertains only to recognition and enforcement of foreign awards.(
there was a particular intent of the legislature to divide the two said awards in two different parts of the Act, so
that the Indian judiciary could not take any extra territorial application of any reliefs granted in part 1 of the
Act to foreign awards seated outside India)

STATUTE TO BE CONSTRUED TO MAKE IT EFFECTIVE AND WORKABLE

 This principle follows the Latin maxim ‘ut res magis valeat quam pereat’, i.e., it is better for a thing to have
effect than to be void.
 which means that it is better to validate a thing than to invalidate, which conveys that it is better the Act
prevails than perish.
 No effort should be made to make an enacted law as „futility‟ since a lot of work is done in the making of the
law to achieve the objectives or purposes. It should not be frustrated merely on the ground that the Statute
contains repugnant or inconsistent provisions or suffers from ambiguities or other reasons. This is based on the
principle „ut res magis valeat quam pereat‟. This means the courts while construing Statutes must presume in
favour of its constitutionality and consider it as within the competence of the legislature to make such a law.
Only in cases where “it is impossible to resolve the ambiguity” or the language used is “absolutely
meaningless”, the Statutes must be held void – that too, not many cases which came for judicial scrutiny . In
other words, „vagueness‟ is not a ground to hold the Statute as void. The courts must make ceaseless effort to
find some meaning to the provisions rather than hold them as void and in cases where several meanings could
be given, one which has close bearing to the Statute may be given.
 The courts strongly lean against a construction which reduces a statute to futility. A statute or enacting
provision therein must be so construed so as to make it effective and operative on the aforementioned maxim.
 There is always a presumption in favour of constitutionality of the statute.
 The importance of the principle can be judged from the fact that there is hardly any reported decision where a
statute may have been declared void for sheer vagueness, obscurity and ambiguity.
 Where a statute has some meaning, even if it is obscure, or has several meanings, even though it is little to
choose between them, the courts have to say what meaning the statute is to bear rather than rejecting it as
nullity. It follows the doctrine of severability.
 If meaning is plain, effect must be given to it irrespective of the consequences (this line gives a demarcation
between interpretation and construction). When the words of the statute are clear, plain and unambiguous, i.e.,
they are reasonably susceptible to only one meaning, the courts are bound to give effect to that meaning
irrespective of consequences.

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 Tindal, C.J., in the Sussex Peerage case, held that if the words of the statute are in themselves precise and
unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense.
The words themselves do alone in such cases best declare the intent of the law-givers.
 In other words, where the language is plain and unambiguous and admits of only one meaning, no question of
construction of a statute arises, since the Act speaks for itself.
 Case: Sirsilk case

APPRAISAL OF THE PRINCIPLE OF PLAIN MEANING

An appraisal of the principle of the plain meaning has to be done by looking at the purpose with which the Act was
brought into being as well as other surrounding Acts. It is not possible to decide whether certain words are plain or
unambiguous unless they are studied in their context and construed. Thus, the rule means that after you have
construed the words and have come to the conclusion that they bear only one meaning, your duty is to give effect to
that meaning.

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 GENERAL PRINCIPLES

General principles in interpretation of statutes are of two kinds – primary and secondary principles.

PRIMARY PRINCIPLES
LITERAL / GRAMMATICAL / PLAIN RULE OF CONSTRUCTION
 Literal or strict rule of construction means that while construing it, judges have to give plain and grammatical
meaning to the text (if such meaning is clear and unambiguous) Prima facie and follow it irrespective of the
consequences. (The eighteenth and nineteenth centuries saw a trend towards a more literal approach. Courts
took an increasingly strict view of the words of a statute: if the case before them was not precisely covered they
were not prepared to countenance any alteration of the statutory language. One of the leading statements of the
literal rule was made by Tindal CJ in the Sussex Peerage Case (1844) 11 Cl&Fin 85:
“… the only rule for the construction of Acts of Parliament is, that they should be construed according to the
intent of the Parliament which passed the Act. If the words of the statute are in themselves precise and
unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense.
The words themselves alone do, in such case, best declare the intention of the lawgiver.
(has gone to extend sometimes where courts have said that even if giving plain meaning leads to absurdity or
an injustice still we have to take literal meaning because they have an erroneous belief that would have been
the intention of the legislature. But in practicality we never used the above principle in such circumstances.)
 Textualism: Textualism is consistent with the Plain Meaning Rule. The plain meaning of a word is
determined by its dictionary definition, its placement in the body of the text, and its common usage at the
time the statute was written. A judge that relies solely on the literal or plain meaning of a text does not
consider supporting or supplementary sources, such as modern social policy or legislative history, when
interpreting a statute. Textualism is a method of statutory interpretation whereby the plain text of a
statute is used to determine the meaning of the legislation. Instead of attempting to determine statutory
purpose or legislative intent, textualists adhere to the objective meaning of the legal text.
 It entails ‘interpreting as it is’ not what ought to be. The words of the law are to be given ordinary and
natural meaning. When the language is plain and unambiguous and admits of only one meaning, no question of
construction of statutes arises. When the language of a statute is plain, words are clear and unambiguous and
give only one meaning, then effect should be given to that plain and ordinary meaning only.
 Natural meaning has to be interpreted using the grammatical rules. (that is to say their natural meaning)
 No modification or logical construction has to be given by the judges.
 The basis of this principle is to know what the legislature intended and such intention is known through
interpretation according to the rules of grammar. When the language used on the statute is unambiguous and on
a plain grammatical meaning being given to the words in the statute, the end result is neither arbitrary , nor
irrational nor contrary to the object of the Act, then it is the duty of the court to give effect to the rods is used in
the statute because the words declare the intention of the law- making authority at best.

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 It is also known as the safest rule as the intention of the lawmaker is deduced from language used by the
lawmaker only. There is a presumption that that the intent of the legislature is always correct and has to be
upheld and maintained.
 This rule is applied unless such application leads to some absurdity or unless there is something in the context,
or in the object of the statute to suggest the contrary.
 The plain meaning rule attempts to guide the courts faced with litigation that turns on the meaning of a term not
defined by the statute or on that of the word found within the definition itself. (Example controversy with
control definition in Competition act and SEBI regulation)
 While applying this rule you have to keep in mind that a text means one thing in legal context and secondly no
scientific or technical definition needs to be given to words until and unless the intention of the legislation tells
us to do otherwise. So, the plain meaning of legal text is something like the meaning that would be understood
by competent speakers of the natural language in which the text was written who are within the intended
readership of the text and who understands that the text is a legal text of certain type.
 Rules used by the judges:
– Litera legis (go by the words of law): Read the particular provision in the form it is given, do not change
the sequence of the sections while reading them. If there are three sections, you have to read them in order
and not in isolation.
– Ita Sriptum (as the words are): using literal rules, you cannot modify the meaning of the words.
 The advantages of using this rule are:
– No scope for the judges’ own opinions to interfere.
– Respect parliamentary supremacy and uphold separation of powers.
– It forces judges to carry out the parliament’s intention, i.e., the legislative intent.
– It promotes certainty in law and reduces litigation.
 Fallacies:
– There is a presumption that the intention of the legislature is correct. This may not always be the case.
– Consequences completely ignored. May be correct for taxation law, but not with all laws in the current
era.

 Ramavatar Budhiprashad vs Assistant Sales Tax Officer (the words in the act must be interpreted in
the light of their popular meaning or common parlance meaning as understood by the common man
and the persons dealing with such articles in their day to day life. Thus the word vegetables used in
taxing statute is to be understood as in common parlance i.e denoting a class of vegetables which are
grown in the kitchen garden or in farm or used in table.) (A)- Dictionary meaning: Reliance was placed
on the dictionary meaning of the word "vegetable" as given in Shorter Oxford Dictionary where the
word is defined as "of or pertaining to, comprised or consisting of, or derived, or obtained from plants
or their parts".)But this word must be construed not in any technical sense nor from the botanical
point of view but as understood in common parlance. It has not been defined in the Act and being a
word of every day use it must be construed in its popular sense meaning " that sense which people

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 conversant with the subject matter with which the statute is dealing would attribute to it." The term
"vegetables" is to be understood as commonly understood denoting those classes of vegetable matter
which are grown in kitchen gardens and are used for the table." ( similar meaning in the case of
MOTIPUR ZAMINDARY CO v STATE OF BIHAR (1962) was applied when in contention for the
term vegetable was sugarcane)
The act of sale of vegetable does not attract sales tax. Therefore, when an assistant sales tax officer wanted to tax
the sale of betel leaf, a vendor objected on the ground that betel leaf was a vegetable. He claimed exemption. To
advance his argument, he relied on the dictionary meaning of vegetable in the Shorter Oxford Dictionary and text
books on botany. This refers to the case of Ramavatar Budhiprashad vs Assistant Sales Tax Officer reported in
AIR 1961 SC 1325 which has become a landmark judgement by the SC.
The SC did not accept the scientific or dictionary meaning of the word vegetable and observed that it must be
construed not in any technical sense nor from a botanical point of view, but as understood in common parlance . It
held: It has not been defined in the Act and being a word of everyday use, it must be construed in its popular sense,
meaning that sense which people conversant with the subject matter with which the statute is dealing would
attribute to it. It is to be understood as understood in common language. In this view, betel leaf was not a vegetable
but a condiment. Not being a vegetable, it could not enjoy exemption from sales tax.
The judgement lays down the basic principle that a vegetable is one that in market parlance is known as such. This
is the definition of vegetable for fiscal laws, but not so for students of botany who would regard betel leaf as a
vegetable. So the definition depends upon who asks the question. For a botany student, betel leaf is a vegetable, but
not so for a tax collector.
Maqbool Hussain v. State of Bombay,  In this case, the appellant, a citizen of India after arriving at the airport did
not declare that he was carrying gold with him. During his search was carried on, gold was found in his possession
as it was against the notification of the government and was confiscated under section 167(8) of Sea Customs Act.
Later on, he was also charged under section 8 of the Foreign Exchange Regulations Act, 1947.  The appellant
challenged this trial to be violative under Article 20(2) of the Indian Constitution. According to this article, no
person shall be punished or prosecuted more than once for the same offence. This is considered as double jeopardy.
It was held by the court that the Seas Act neither a court nor any judicial tribunal. Thus, accordingly, he was not
prosecuted earlier. Hence, his trial was held to be valid.
Manmohan Das versus Bishan Das, AIR 1967 SC 643

 Duport Steel v. Sirs. Where the meaning of statutory words is plain and unambiguous, it is not then for the
judges to invent fancied ambiguities as an excuse for failing to give effect to its plain meaning. Judge should
not deviate from the literal meaning, even if it is unjust.
 Whitely v Chappel (1868) LR 4 QB 147
A statute made it an offence 'to impersonate any person entitled to vote.' The defendant used the vote of a dead
man. The statute relating to voting rights required a person to be living in order to be entitled to vote.
Held:The literal rule was applied and the defendant was thus acquitted.

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 (though you can see the intention of the parliament was to punish people who were trying to impersonate, but
literal rule does not take into account the consequences of literal interpretation: punish the wrongdoer. Now if
parliament does not like the literal interpretation, then it must amend the legislation.
 Fischer v. Bell. Fisher v Bell [1960] 3 All ER 731. The Restriction of Offensive Weapons Act 1959 made it an
offence to offer for sale certain offensive weapons including flick knives. James Bell, a Bristol shopkeeper,
displayed a weapon of this type in his shop window in the arcade at Broadmead. The Divisional Court held that
he could not be convicted because, giving the words in the statute a tight literal meaning, Mr Bell had not
offered the knives for sale. In the law of contract, placing something in a shop window is not technically an
offer for sale; it is merely an invitation to treat. It is the customer who makes an offer to the shop when he
offers money for an item on sale. The court upheld that under the literal meaning of offer, the shopkeeper had
not made an offer to sell and so was not guilty of the offence.
Note: The UK Parliament subsequently changed the law to make it clear that displaying a flick knife in a shop
window was an offence.
 R. v. Harris. Stabbing, cutting or wounding someone was deemed to be an offence. A person bit another’s
nose. The Court held that biting did not fall under the terms ‘stabbing’, ‘cutting’ or ‘wounding’ as these words
implied that an instrument had to be used. Under the literal rule, biting was not seen to be stabbing, cutting or
wounding.

 Bharat Aluminium Company v. Kaiser Aluminium Technical Services Inc. A Constitution Bench of the
Supreme Court was called upon to decide whether Part I of the Arbitration and Conciliation Act, 1996 applies
to arbitral proceedings taking place outside India. Section 2(2) of Part I of the Act provides that this part shall
apply where the place of arbitration is in India and not that the part shall only apply where the place of
arbitration is in India.

It was held that the absence of the word ‘only’ from Section 2(2) could not be construed so as to make Part I of
the Act applicable to arbitrations taking place outside India. As a plain reading of Section 2(2) makes it clear,
Part I is limited in its application to arbitrations which take place in India. There is no ambiguity and therefore
no need of construction. {NOTE IN WRITING THE ANSWER- Literal Rule has to be applied first and then if
there is ambiguity then it has to be mentioned.}

 Haji S. K. Subhan v. Madharao. The principle laid down herein was that a departure from the rule of literal
construction outside the recognised limits in the guise of liberal or strict construction leads to unwarranted
expansion or restriction of the meaning of words and gives rise to serious errors.

Clause 2(g) of the Madhya Pradesh Abolition of Proprietary Rights Act, 1950, defines ‘home farm’ as as
meaning land recorded as ‘sir’ and ‘khudkast’ in the name of the proprietor. The Nagpur High Court held that
this definition should be construed liberally and that land, though not recorded as khudkast of the proprietor,
but ought to have been recorded as such (since the land was used for cultivation), should be brought within the
definition. This decision was overruled as it was held that the basis of treating a particular land as ‘khudkast’
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 was a recording to that effect and not the fact of actual cultivation. There was no ambiguity in the definition of
‘home farm’ and the question of strict and liberal construction does not arise.

 Kotak Mahindra Bank v. Hindustan National Gas and Industries. The principle laid down herein was that
it is only when the meaning leads to some result which cannot reasonably be supposed to have been the
intention of the legislature, that it is proper to look for some other possible meaning of the word or phrase.

The Supreme Court was called upon to interpret the term ‘wilful default’ in the RBI Master Circular on Wilful
Defaulters. Though the definition of the term in the Master Circular used the term ‘lender’, the Court held that
the words in a statute or document are to be interpreted in the context or subject-matter in which they are used,
and not according to their literal meaning. The term ‘lender’ was held to mean ‘bank’ after looking into the
RBI Act, the Banking Regulations Act as well as the purpose for which the Circular was issued and the
mischief it sought to curtail.

It was noted that in the construction of a statute, you have to look at:
– The statute as a whole.
– The previous state of the law.
– Other statutes in pari materia.
– The general scope of the statute.
– The mischief that it was intending to remedy.

Commissioner of Sales Tax, MP Indore v. Jaswant Singh Charan. In construing the word ‘coal’ in the Sales
Tax Act, the Supreme Court ruled in favour of the popular meaning by asking the question “what would be the
meaning which persons dealing with coal and consumers purchasing it as fuel would give to that word”. On this
test, coal was held to include charcoal and not restricted to coal obtained as a mineral. ( In interpreting items in
statutes like the Sales Tax resort should be had not to the scientific or technical meaning of the terms
used but to their popular meaning or the meaning attached them by those dealing in them, that is to
say, in their commercial sense. Viewed from this angle both a merchant dealing in coal and a
consumer wanting to purchase it would regard coal not in its geological sense but in the sense as
ordinarily understood and would include 'charcoal in the term 'coal'.)
Respondent argued that charcoal was coal and should be taxed at 2% rate according to the said provision whereas
tax authorities were arguing that charcoal was not coal and should be taxed at 4%
Under the Entries.' 'coal' as well as 'firewood' were taxed at 2%. It could not have been intended to tax
charcoal alone at 4%.

In contrast, it was said that in the Colliery Control Order( law for prohibiting or limiting the production of coal as
per government order), the word ‘coal’ will be understood in its technical or scientific sense and will be interpreted
as a mineral product, therefore not including charcoal. The Court held that the natural and ordinary meaning of the

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word ‘coal’ would be coal used as fuel in the context of the Sales Tax Act and coal as a mineral product in the
context of the Colliery Control Order.
 CIT v. T. V Sundaram Iyyengar (1975) 101 I.T.R 764 SC
The meaning of Literal Rule was given in this case as, "If the language of the statute is clear and unambiguous,
the Court cannot discard the plain meaning, even if it leads to an injustice."

 Keshavji Ravji and Co. v. CIT (1990) Taxmann 87 SC

The meaning of literal rule is stated that, As long as there is no ambiguity in the statutory language, resort to
any interpretative process to unfold the legislative intent becomes impermissible.

Rules to be followed in Literal Rule of interpretation

EJUSDEM GENERIS
 The term literally translates to ‘of the same kind’.
 If the law lists specific classes of persons or things, and then refers to them in general, the general statement or
words only apply to the same kind of persons or things specifically listed.
 The rule is that where the particular words have common characteristics (i.e., they form a class), and the
general word that follows should be construed as referring to that particular class.
 This rule applies in situations wherein there is a common or general word, after a series of specific words. The
specific words act as a genus for interpretation of the general word.
 Examples:
– Under article 24 of the Constitution, “no child shall be employed to work in any factory or mine, or
engage in any other hazardous employment”. The rule of ejusdem generis will apply here, since there is a
valid genus.
– In the interpretation of the phrase “theatre or any other places of public announcement”, the rule of
ejusdem generis will not apply since there is no valid genus.
– The expression ejusdem generis signifies a principle of construction whereby words in a statute which are
otherwise wide but are associated in the text with more limited words, are by implication given a restricted
operation.
– The doctrine is an attempt to reconcile an incompatibility between specific and general words in view of
the other rules of construction that all words in a statute are to be given due effect and legislature doesn’t
use superfluous words.
– The rule accomplishes the purpose of giving effect to both particular words and general words by treating
the particular words as indicating the class ( or becomes a genus that is to say have similar characteristics)
and the general words as extending the provision of the statute to everything included in that class though
not specifically named by a particular word.

 State of Bombay v. Ali Gulshan.

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 – This case involved the interpretation of section 6(4)(a) of the Bombay Land Requisition Act, 1948, under
which, “the state government may requisition (an official order laying claims to use property or materials),
for the purpose of state or any other public purpose…”. The general phrase here, was ‘public purpose’. It
was contended that under the provision, the Appellant was entitled to requisition premises for housing a
member of a foreign consulate.
– The High Court held that we can apply the ejusdem generis rule and that the expression ‘any other public
purpose’ should be read, ejusdem generis, with the purpose of the state and providing accommodation to a
member of a foreign consulate, being the primary purpose of the union (and not of the state), the state
government had no authority to requisition the premises.
– The Supreme Court held that the High Court was in error in applying the ejusdem generis rule because the
general expression of ‘any other public purpose’, follows only a single expression ‘for the purpose of the
state’, which is not a distinct genus. In the absence of a distinct genus, there is no application of the
ejusdem generis rule.

 The Archbishop of Canterbury Case. This case provides for certain conditions for the doctrine of ejusdem
generis to apply. They are:
– The statute contains an enumeration by specific words.
– The members of the enumeration suggest a class.
– The class is not exhausted by enumeration.
– A general reference supplementing the enumeration generally following it.
– There is no clearly manifested intent that the general term be given a broader meaning that the doctrine
requires.

 Lilavati Bai v. Bombay State.

– In this case, the petitioner was a widow of a tenant of a certain premise, which she had vacated. Finding
the premises vacant, the respondent requisitioned it under section 6(4)(a) of the Bombay Land Requisition
Act, 1948 for the public purpose of housing a government servant.
– One of the explanations to the sub-section stated that there would be deemed to be a vacancy when the
tenant ceases to be in occupation upon termination of his tenancy, eviction, assignment or transfer in any
other manner of his interest in his premises or otherwise.
– On looking at the intent of the provision, it is evident that they had the right to take over the property.
– Legislature intended to give it the widest possible amplitude. Hence, the rule of ejusdem generis does not
apply.
– Application of the rule is presumptive ( that is treated sufficient for proving intention unless treated
otherwise) and not pre- emptory (to take action in order to prevent something from happening).

 Calcutta Municipal Corporation v. East India Company Hotels Ltd. (1994).

– There were three restaurants in a hotel, and there used to be occasional musical and dance shows.

15
 – Section 443 of the Calcutta Municipal Corporation Act, pertaining to obtainment of license, the terms
“theatre, circus, cinema house, dancing hall” were followed by the expression “other similar placed of
public resort, recreation or amusement”. The intention and purpose of the provision were very clear –
there was no ambiguity.
– The question was whether license was required for organising music and dance shows since the primary
purpose of the establishment was to serve as a hotel.
– The High Court answered the question in the negative and in favour of EIC Hotels Ltd. by applying the
rule of ejusdem generis. It held that the general words were intended to have restricted meaning in the
sense that other similar places must fall within the class enumerated by the specific words. It held that a
restaurant, which provides amusement occasionally or incidentally to its primary business as a hotel, it is
not a place of ‘public resort’ under section 443. Hence, license was not required to be obtained.
– On appeal, the Supreme Court held that it was not necessary for the HC to rely on the rule of ejusdem
generis. The provisions of section 443 were clear and unambiguous; there was no occasion to call into
consideration the said rule. The question then was whether the activity could bring the restaurants within
the meaning of ‘dancing halls’. The Court found that the restaurants in the hotel had dance floors, for the
guests’ enjoyment. The entertainment, further, was provided by music (including vocal music). At relevant
times, cabaret shows were also performed at the restaurant to entertain the guests.
– Hence, the Court held that the establishment fell within the ambit of a ‘dancing hall’, which required a
license under section 443 to operate. Simply because the recreation in the nature of dancing was provided
along with a posh dinner, would not make it different from a dancing hall where drink and eatables were
invariably provided.
– Therefore, the Court held that restaurants run by the hotel were places similar to dancing halls and were
bound by section 443 of the Act.

CASUS OMISSUS

 The literal translation of ‘casus omissus’ is ‘cases of omission’.

 Omission in a statute cannot be supplied by construction. You cannot legislate, unless the legislature provide
for it. It is linked with the concept of judicial overreach. Even if there is a defect or omission in the words used
by the Legislature, the court cannot correct the deficiencies, especially when a literal reading produces an
intelligible result.
 A matter which should have been, but has not been provided for in a statute cannot be supplied by courts, as to
do so will be legislation and not construction.
 However, where the lacuna in the language is of such nature that unless the omitted word is supplied, the
statute cannot operate, or the true intention of the legislature cannot be established, the courts have inserted the
missing word in the language to ensure that the law is not turned to nullity. This relates to circumstances where
a court can supply a clearly unintended omission by the legislature in drafting a provision. This issue arises
quite frequently and in varying circumstances.

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 Lord Denning observed that “where a defect appears, a judge cannot simply fold hands and blame the
draftsmen. Rather, he must set to work on the constructive task of finding the intention of the Parliament and
then he must supplement the written words so as to give force and life to the intention of the legislature.”

 Basavanatappa v. Gangadhar Narayan Dharwadkar.

– This case relates to the construction of Order XXI Rule 89 of the Code of Civil Procedure after the
amendment of Article 127 of the Limitation Act. Rule 89 provides that if any person, claiming an interest
in the property sold in execution of a decree, applies to have the execution sale set aside and deposits
within thirty days from the date of the sale, 5% of the purchase money for payment to the purchaser and
the amount payable to the decree-holder for recovery of which the sale was held, the court shall make an
order setting aside the sale.
– The period of limitation for applying under Rule 89 for setting aside the sale was 30 days under Article
127 of the Limitation Act. After its amendment in 1976, the period was enlarged to 60 days. However, the
Parliament omitted to make corresponding amendment in Rule 89 to enlarge the period for making deposit
to 60 days.
– The object and reason of the amendment bill showed that the period was enlarged since 30 days was
considered to be too short for making the deposit, often leading to hardship.
– The Court held that in addition to the period of limitation for making application being extended to 60
days, the period for making the deposit under Rule 89 was also impliedly extended from 30 days to 60
days.
– The subsequent decision in PK Unni v. Nirmala Industries overruled this decision.
– Later, a 5-judge Bench in Dadi Jagannadham v. Jammulu Ramulu overruled Nirmala Industries (i.e.,
upheld the position in Basavanatappa). Although accepting that the court cannot make up deficiencies left
by the legislature, it observed that the court must try to harmonise the conflicting provisions.
–
Banglore Water Supply case

ec.2 (j) of the Industrial Disputes Act, 1947 defines ‘industry’ as any business, trade,
undertaking, manufacture, or calling of employers and includes any calling, service,
employment, handicraft or industrial occupation or avocation of workmen”.

An industry exists only when there is relationship between employers and employees, the
former is engaged in business, trade, undertaking, manufacture or calling of employers and the
latter is engaged in the calling, service, employment, handicraft or industrial occupation and
avocation.

Sec. 2(j) gives the definition of industry, which was elaborated upon by the Supreme Court in
the Bangalore Water Supply and Sewerage Board v. R. Rajappa[i]. The term industry has been
given a wide scope and the judgment overruled several earlier decisions. The court held-

1. Any activity will be industry if it fulfills the ‘triple test’, as under:

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  Systematic and organized activity
 With the cooperation between Employers and employees
 For the production and distribution of good and services whether or not capital has been
invested for this activity.

2. It is immaterial whether or not there is profit motive or whether or not there is capital.

3. If the organization is a trade or business it does not cease to be one because of philanthropy
animating the triple test, cannot be exempted from scope of definition of industry.

4. Dominant nature test – whether there is complex of activities, the test would be predominant
nature of services and integrated nature of departments. All departments integrated with
industry will also be industry.

Though the rule of casus omissus i.e. “what has not been provided for in the statute
cannot be supplied by the Courts” is a strict rule of interpretation there are certain well
known exceptions thereto. The following opinion of Lord Denning in Seaford Court
Estates Ltd. v. Asher, (1949) 2 All ER 155 should be taken note of:
“The English language is not an instrument of mathematical precision. Our literature would
be much the poorer if it were… He (The Judge) must set to work in the constructive task of
finding the intention of Parliament, and he must do this not only from the language of the
statute, but also from a consideration of the social conditions which gave rise to it, and of the
mischief which it was passed to remedy, and then he must supplement the written word so as
to give “force and life” to the intention of the legislature… A Judge should ask himself the
question, how, if the makers of the Act had themselves come across this ruck in the texture of
it, they would have straightened it out? He must then do as they would have done. A Judge
must not alter the material of which the Act is woven, but he can and should iron out the
creases.”
In Magor & St. Mellons Rural District Council v. Newport Corporation, (1950) 2 All ER
1226 the Learned Judge restated the above principles in a somewhat different form
to the following effect: “We sit here to find out the intention of Parliament and of Ministers
and carry it out, and we do this better by filling in the gaps and making sense of the
enactment than by opening it up to destructive analysis.”
Though the above observations of Lord Denning had invited sharp criticism in his
own country we find reference to the same and implicit approval thereof in the judicial
quest to define the expression ‘industry’ in Bangalore Water Supply & Sewerage
Board v. A Rajappa, (1978) 2 SCC 213. Paragraphs 147 and 148 of the opinion of
Chief Justice M.H. Beg in Bangalore Water Supply would clearly indicate the
acceptance of the Court.

-"In Jacob Mathew's case, this Court clearly held that in criminal law medical professionals are placed
on a pedestal different from ordinary mortals. It was further held that to prosecute the medical
professionals for negligence under criminal law, something more than mere negligence had to be proved.
Medical professionals deal with patients and they are expected to make the best decisions in the
circumstances of the case. Sometimes, the decision may not be correct, and that would not mean that the
medical professional is guilty of criminal negligence. Such a medical professional may be liable to pay
damages but unless negligence of a high order is shown the medical professionals should not be dragged
into criminal proceedings. That is why in Jacob Mathew's case (supra)this Court held that in case of

18
criminal negligence against a medical professional it must be shown that the accused did something or
failed to do something in the given facts and circumstances of the case which no medical professional in
his ordinary senses and prudence would have done or failed to do."
The bench thus allowed the appeal and observed that in such cases an independent opinion of
a medical professional should be obtained.

Facts

In a landmark judgment of the Supreme Court of India the judgment stipulates the guidelines
to be followed before launching a prosecution against a doctor for negligence. On February
15, 1995, the informant's father, was admitted as a patient in the private ward of a hospital.
On February 22, 1995 at about 11 p.m., the patient felt difficulty in breathing. The
complainant's elder brother, who was present in the room contacted the duty nurse, who in
turn called a doctor to attend to the patient. No doctor turned up for 20-25 minutes. Then
doctors came to the room of the patient. An oxygen cylinder was brought and connected to the
mouth of the patient, but the breathing problem increased further. The patient tried to get up,
but the medical staff asked him to remain in the bed. The oxygen cylinder was found to be
empty. There was no other gas cylinder available in the room. Son of the patient went to the
adjoining room and brought a gas cylinder. However, there was no arrangement to make the
gas cylinder functional and meanwhile, 5-7 minutes were wasted. By this time, another doctor
came and declared that the patient was dead. The complaint as per records reads as follows.
“The death of my father has occurred due to the carelessness of doctors and nurses and
nonavailability of oxygen cylinder and the empty cylinder was fixed on the mouth of my
father and his breathing was totally stopped hence my father died. I sent the dead body of my
father to my village for cremation and for information I have come to you. Suitable action be
done.”[1]

RULES TO BE KEPT IN MIND BY JUDGES WHILE ADDING WORDS TO A STATUTE

1. The legislature is always right, so, there is no presumption that a casus omissus exists. This is to avoid the
negative effects of judicial activism. In the garb of interpretation, judges must not legislate by adding / altering
terms.
2. The intention of the words is sufficiently portrayed through whatever the legislature has legislated.
3. It is presumed that the legislature does not waste any words and the courts should try to achieve the intention
with the given words.
4. However, where the alternative lies between either supplying by implication, words that appear to have been
accidentally omitted, or adopting a construction which deprives certain existing words of all meaning, it is
permissible to supply words [Surjit Singh Kalra v. Union of India].

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5. Wherever the court is supplying any words, it should be possible to state with certainty that these, or similar
words, would have been inserted by the draftsmen and approved by the Parliament, had their attention been
drawn to the omission before the Bill was passed [Union of India v. Hansoli Devi].

 A Verbis Legis Non-Est Recedendum ( from the words of the law there must be no departure)

Explanation
The object of the maxim depends on the interpretation of statutes which is determine the intention of the legislature
conveyed expressly or impliedly in the language used. The court interprets the legislature whenever a dispute arises
before the court. Since the will of the legislature is generally expressed in the form of statutes, the prime concern of
the court is to find out the intentions of the legislature in the language used by the legislature in the statute. It is the
duty of the court not to modify the language of the Act and if such meaning is clear and unambiguous, the effect
should be given to the provisions of a statute. The concept behind such a principle is that the legislature, being the
supreme law-making body must know what it intends in the words of the statute. The literal interpretation has been
called the safest rule because the legislature’s intention can be deduced only from the language through which it
has expressed itself.
Case Laws
In Hardeep Singh Vs. State of Punjab and Ors., the Supreme Court held that “It is a settled principle of law that
an interpretation which leads to the conclusion that a word used by the legislature is redundant, should be avoided
as the presumption is that the legislature has deliberately and consciously used the words for carrying out the
purpose of the Act. The legal maxim “A Verbis Legis Non-Est Recedendum” which means, from the words of the
law, there must be no departure has to be kept in mind.”

The Income Tax Appellate Tribunal ITAT Pune referring to the maxim A verb is legis non-est referendum
in Shri Lunawat Jayant Maniklal Vs. Dy. C.i.T. held that the meaning of the maxim is that a literal construction
of law is not to be departed from. The general principle for the interpretation of the taxing statute is that the statute
has to be strictly construed. The well-established rule in the familiar words of LORD WENSLEYDALE,
reaffirmed by LORD HALSBURY and LORD SIMONDS, means; “The subject is not to be taxed without clear
words for that purpose; and also, that every Act of Parliament must be read according to the natural construction of
its words.

The Supreme Court in Rohitash Kumar and ors. Vs. Om Prakash Sharma (2013) held that “The legal maxim a
verb is legis non-est referendum means, “From the words of the law, there must be no departure”. A section is to be
interpreted by reading all of its parts together, and it is not permissible, to omit any part thereof. The Court cannot
proceed with the assumption that the legislature while enacting the Statute has committed a mistake; it must
proceed on the footing that the legislature intended what it has said; even if there is some defect in the phraseology
used by it in framing the statute, and it is not open to the court to add and amend, or by construction, make up for
the deficiencies, which have been left in the Act. The Court can only iron out the creases but while doing so, it
must not alter the fabric, of which an Act is woven. The Court, while interpreting statutory provisions, cannot add
20
words to a Statute, or read words into it which are not part of it, especially when a literal reading of the same,
produces an intelligible result.”

21
22
GOLDEN RULE OF INTERPRETATION

 It is an extension of the literal rule and was expounded in the case of Maltison v. Hart.
 It is used when grammatical interpretation leads to absurdity. A pre-requisite of the golden rule is application
of the literal rule. If such application leads to absurdity, the golden rule will be applied. [It is an absurdity when
the meaning culled out using the literal interpretation is such that it can, in no circumstance, be the intention of
the legislature.]
 This rule allows a judge to depart from the words’ normal meaning in order to avoid an absurdity from the
results. When the absurdity arises, the court can divert only to the extent so that the effect of the absurdity is no
more.
 The rule tries to avoid absurd consequences arising from the literal interpretation. It aims at giving effect to the
spirit of the law rather than just mechanical or grammatical meaning.
 Only when grammatical construction cannot be given without a doubt, the golden rule applies.

 Interpretation is of two kinds – grammatical and logical. Grammatical

interpretation is arrived at by reference to the laws of speech to the words
used in the statute; in other words, it regards only the verbal expression of
the legislature. Logical interpretation gives effect to the intention of the
legislature by taking into account other circumstances permissible according
to the rules settled in this behalf. ‘Proper construction’ is not satisfied by
taking the words as if they were self-contained phrases. So considered, the
words do not yield the meaning of a statute.[viii]
 According to Gray, grammatical interpretation is the application to a statute of
the laws of speech; logical interpretation calls for the comparison of the
statute with other statutes and with the whole system of law, and for the
consideration of the time and circumstances in which the statute was passed.
It is the duty of the judicature to ascertain the true legal meaning of the words
used by the legislature.

23
 A statute is the will of the legislature and the fundamental rule of
interpretation, to which all others are subordinate, and that a statute is to be
expounded, according to the intent of them that made it. [ix] The object of
interpretation is to find out the intention of the legislature.
he primary and foremost task of a court in interpreting a statute is to ascertain
the intention of the legislature, actual or imputed. The words of the statute are to
be construed so as to ascertain the mind of the legislature from the natural and
grammatical meaning of the words which it has used. ‘The essence of the Law’,
according to Salmond:[x]
Lies in its spirit, nor in its letter, for the letter is significant only as being the
external manifestation of the intention that underlies it. Nevertheless, in all
ordinary cases, the courts must be content to accept the litera legis  as the
exclusive and conclusive evidence of the sententia legis. They must, in general,
take it absolutely for granted that the legislature has said what it meant, and
meant what it has said.
Ita scriptumest  is the first principal of interpretation. Judges are not at liberty to
add to or take from or modify the letter of the law simply because they have
reason to believe that the true sententia legis is not completely or correctly
expressed by it. It is to say, in all ordinary case grammatical interpretation is the
sole form allowable.
Parke B in  Becke v. Smith[xi] formulated the following well-known rule for the
interpretation of statutes:
If the precise words used are plain and unambiguous, in our judgment, we are
bound to construe them in their ordinary sense, even though it does lead, in our
view of the case, to an absurdity or manifest injustice. Words may be modified or
varied where their import is doubtful or obscure, but we assume the function of
legislators when we depart from, the ordinary meaning of the precise words
used merely because we see, or fancy we see, an absurdity or manifest injustice
from adherence to their literal meaning.

 Lee v. Knapp. The law was that the driver causing an accident shall stop after the accident. Herein, a driver
stopped for a moment after the accident and then moved away. The result of the application of the literal rule
would be that the driver had complied with the law. However, that could not have been the intention of the
legislature. It was thus held, applying the golden rule, that requirement of the law had not been followed by the
driver as he had not stopped for a reasonable period, requiring interested persons to make necessary inquiries
from him about the cause of the accident.

24
 Grey v. Pearson. The Lord Wensleydale rule was expounded in this case. It posited that the grammatical and
ordinary sense of the words is to be adhered to unless such adherence would lead to some absurdity or
repugnance or inconsistency with the rest of the instrument, in which case the grammatical and ordinary sense
of the words may be modified so as to avoid the absurdity and the inconsistency, but no farther.

 Adler v. George. This case dealt with section 3 of the Official Secrets Act, 1920. Under it, it was an offence to
obstruct forces in the vicinity of a prohibited place. Adler was arrested for obstructing forces whilst in a
prohibited area. Under the literal rule, Adler was not technically ‘in the vicinity of the area’, he was in the area
itself and so was not infringing the terms of the Act. The golden rule was applied to extend the meaning of
‘vicinity’ and avoid the possible absurd outcome. Thus, Adler was held liable.

 Re Sigsworth. A son murdered his mother. The mother had not made a will. Under the Administration of
Justice Act, 1925, if someone dies without a will, the estate would to the next of kin, who in this case was the
son. There was no ambiguity in the words of the Act, but the Code was not prepared with the intention to let
the son who had murdered his mother benefit from his crime. It was held that the literal rule should not apply
here and the golden rule should be used to prevent the repugnant situation.

 R. v. Allen. The defendant was charged with bigamy under Section 57 of the Offences Against the Person Act
1861, which stated ‘whosoever being married shall marry any other person during the lifetime of the former
husband or wife is guilty of an offence’. Under the literal rule, bigamy would be impossible because civil
courts do not recognise second marriages. Thus, no person already married could technically be ‘married’ to a
second person during the lifetime of the first spouse. The golden rule was applied to determine that the word
‘marry’ should be seen as ‘to go through ceremony’ and the conviction was upheld.

 Tirath Singh v. Bachittar Singh. In this case, Justice Venkatramana Aiyyar noted that where the language of
a statute, in its ordinary meaning and grammatical construction, leads to a manifest contradiction of the
apparent purpose of the enactment, or to some inconvenience or absurdity, hardship or injustice, presumably
not intended, a construction may be put upon it which modifies the meaning of the words, and even the
structure of the sentence.

Facts
In this case, there was an issue with regard to issuing of the notice under section 99 of Representation of
People’s Act, 1951, with regard to corrupt practices involved in the election.
According to the rule, the notice shall be issued to all those persons who are a party to the election petition and
at the same time to those who are not a party to it. Tirath Singh contended that no such notice was issued to
him under the said provision. The notices were only issued to those who were non-parties to the election
petition. This was challenged to be invalid on this particular ground.

25
 The court held that what is contemplated is giving of the information and the information even if it is given
twice remains the same. The party to the petition is already having the notice regarding the petition, therefore,
section 99 shall be so interpreted by applying the golden rule that notice is required against non-parties only.

 State of Punjab v. Quiser Jehan Begum , AIR 1963 SC 1604,  a period of

limitation was prescribed for, under section 18 of land acquisition act, 1844, that
an appeal shall be filed for the announcement of the award within 6 months of the
announcement of the compensation. Award was passed in the name of Quiser
Jehan. It was intimated to her after the period of six months about this by her
counsel. The appeal was filed beyond the period of six months. The appeal was
rejected by the lower courts.

It was held by the court that the period of six months shall be counted from the
time when Quiser Jehan had the knowledge because the interpretation was leading
to absurdity. The court by applying the golden rule allowed the appeal.

 Velamuri Venkata Sivaprasad v. Kothuri Venkateshwar.

– In this case, the principles of sincerity, substantial justice and fairness were applied.
– Section 2 of the Hindu Widows’ Remarriage Act, 1856 provides that all rights and interests which a Hindu
widow had in her husband’s property, shall cease and determine upon her remarriage.
– The Madras Hindu (Bigamy Prevention) Act, 1949 prohibited a bigamous marriage.
– Therefore, the marriage of a Hindu widow with a person whose first wife was living could not be held to
be a valid marriage.
– Still, it was held that such a marriage amounted to ‘remarriage’ within section 2 of the 1856 Hindu
Widows’ Remarriage Act and the widow ceased to hold any rights in the property held by her deceased
husband. [Situation where A’s husband B dies and A chooses to marry C, who is already married to D]
– Criticism: However, the view that an invalid or void marriage could amount to ‘remarriage’ under section
2 of the 1856 Act is open to objection. Apart from other reasons, the Act made the widow lose her rights
in the property left by her deceased husband for the reason that the widow on remarriage got rights in the
property of her new husband and this could be possible only if the remarriage was valid. So if the widow
was made to lose her rights in the property of her deceased husband as a result of invalid remarriage she
would be wholly unprotected even for her maintenance and the view taken will not be in furtherance of
either gender equality or fairness (especially considering that the legislative intent behind maintenance is
financial protection).

 Rakesh Wadhwan v. Jagadamba Industrial Corp.

26
– Section 13(2)(i) of the East Punjab Urban Rent Restriction Act, 1949 provides for eviction of a tenant who has
not paid or tendered the rent due.
– There is a proviso to that section which reads: “Provided that if the tenant on the first hearing of the application
for ejectment after due service pays or tenders the arrears of rent and interest at 6% per annum on such arrears
together with cost of application assessed by the controller, the tenant shall be deemed to have duly paid or
tendered the rent.”
– The proviso does not in terms provide that if there be a genuine dispute regarding the arrears due, the controller
will provisionally determine the arrears and give time to the tenant to deposit the same to save eviction.
– Yet, such a provision was read by implication to avoid hardship and injustice to the tenant in case of a genuine
dispute of arrears of rent. The court reached this conclusion by holding that the qualifying expression ‘assessed
by the controller’ in the proviso qualified also ‘the arrears of rent’ and not merely ‘cost of application’.
– Relevant paragraph from the Case. “While exercising discretion for affording the tenant an opportunity of
making good the deficit, one of the relevant factors to be taken into consideration by the Controller would be,
whether the tenant has paid or tendered with substantial regularity the rent falling due month by month during
the pendency of the proceedings.
– Para 6: The view of the law so taken by us advances the object sought to be achieved by the legislation, serves
best the interests of landlord and tenant both, removes uncertainty in litigation and obscurity in drafting of the
provision and also accords with the principles of justice and equity. Even if, it is an innovation, it is in the field
of procedural law, without affecting the substantive rights and obligations of the landlord and the tenant and
such innovation is permissible on the basis of authority and supported by principles of justice, good sense and
reason. We have not touched the substantive rights of landlord and tenant, and are feeling satisfied with a do
little in the field of procedure so as to effectuate the purpose of enactment.
–
 Central India Spinning and Weaving and Manufacturing Company Ltd., Empress Mills, Nagpur v.
Municipal Committee, Wardha.
– In construing section 66(1) of the Central Provinces and Berar Municipalities Act, 1922 which authorised
imposition of ‘a terminal tax on goods or animals imported into or exported from the limits of a
municipality’, the question before the Supreme Court was whether the said clause empowered the
municipality to levy a tax on goods in transit.
– The High Court had adopted the derivative meaning of words import and export, i.e., to bring in and to
carry away and had therefore held that the municipality had the power to levy terminal tax on goods in
transit.
– The Supreme Court in reversing the decision of the High Court pointed out that the words import and
export in their ordinary commercial sense do not refer to goods in transit.
– In selecting the commercial sense of the words in preference to derivative sense, Justice Kapur observed
that the effect of the construction of ‘import’ or ‘export’ in the manner insisted upon by the respondent
(municipal committee) would make rail-borne goods passing through a railway station within the limits of
a municipality liable to the imposition of the tax on their arrival at the railway station or departure
therefrom or both which would not only lead to inconvenience but confusion, and would also result in
27
 inordinate delays and unbearable burden on trade both inter-state and intra-state. It was deemed to be
hardly likely that that was the intention of the Legislature. Such an interpretation would lead to absurdity
which, according to rules of interpretation, is to be avoided.

Section 66(1)(0) of the C. P. and Berar Municipalities

Act, 1922, empowered the municipalities to impose "a
terminal tax on goods or animals imported into or exported
from the limits of a municipality". The respondent framed
rules for the imposition of terminal tax. The appellant
transported bales of cotton from Yeotmal to Nagpur by road
and the vehicles carrying the goods passed through the
limits of respondent municipality. The goods were neither
unloaded nor reloaded at Wardha bat were merely carried
across through the municipal area. The respondent collected
terminal tax on these goods on the ground that they were
exported by the appellant from the limits of the respondent
municipality. The appellant disputed his liability to pay
terminal tax, and claimed a refund :
Held, that the goods which were in transit and were
merely carried across the limits of the municipality were
not liable to terminal tax. Terminal tax on goods imported
into or exported
from the limits of a municipality was payable on goods on
their journey ending within the municipal limits
or
commencing therefrom and not where the goods were merely in
transit and had their terminus elsewhere. Terminal tax
leviable under s. 66(1)(o) must have reference to some
activity within the municipal area i.e., the entry for the
purpose of remaining within that area or the commencement of
the journey from that area.
The words "imported into" do not merely mean "bringing
into"but comprise something more i.e., incorporating and
mixing up of the goods with the mass of the property in
the local area. Similarly, the words "exported from" do not
merely indicate, "taking out" but have reference to the
taking out of goods which' had become part and parcel of the
mass of the property of the local area and will not apply to
goods in transit i.e. brought into the area for the purpose
of being transported out of it.

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 Shanti Devi v. Pramod Kumar. Desertion is a ground for divorce under the Hindu Marriage Act. The
question in this case was whether mere departure from home by wife because of unfavourable conditions
would amount to ‘desertion’. The Court held giving a literal interpretation to the term would be too restrictive,
and that it would not amount to desertion.

 Nokes v. Doncaster.
– Mr Nokes had worked for the Hickleton Main Co. Ltd. The Chancery Court gave an order for the business
of the company to be transferred on arrangements and reconstructions to Doncaster Amalgamated
Collieries Ltd. Mr. Nokes believed himself to be working under his contract with the Hickleton Main
Colliery Co. Ltd., since his contract had never been terminated by notice
– The appellant was absent on one day, and the Divisional Court and the Court of Appeal ordered Mr Nokes
to pay damages to Doncaster Ltd. under section 4 the Employers and Workmen Act 1875. [Under it,
anyone who had a service contract with the company would have to pay if they were absent].
– Mr. Nokes denied that he had a service contract with Doncaster Ltd. He appealed to the House of Lords.
– The House of Lords held, by a majority, that Mr Nokes did not have to pay the fee because his
employment could not be transferred without his consent.
– Lord Atkin vigorously denied that EWA 1875 could result in a fine for the worker, going so far as to say
that any automatic transfer rule would be ‘tainted with oppression and confiscation’.
– Viscount Simon LC said that it is a fundamental principle of our common law that a free citizen, in the
exercise of his freedom, is entitled to choose the employer whom he promises to serve, so that the right to
his services cannot be transferred from one employer to another without his assent. He asserted that if the
choice is between two interpretations, the narrower of which would fail to achieve the manifest purpose of
the legislation, we should avoid a construction which would reduce the legislation to futility, and should
rather accept the bolder construction, based on the view that Parliament would legislate only for the
purpose of bringing about an effective result.

 G. Narayanaswami v. G. Pannerselvam. For election of the electorate to the Legislative Council, there was a
condition that the voter had to be a graduate. However, the candidate did not have to be a graduate. Some
people from the Madras constituency argued that if there is a qualification for a voter, the candidate also should
meet the same qualification. The Supreme Court, here, said that there was a ‘deliberate omission’ on part of the
Legislature.

The Appellant’s election held on April 11, 1970 to the Madras Legislative Council from the Madras District
Graduates’ constituency was set aside by the learned judge of the Madras High Court. They arrived at this
decision on the grounds that:
– The appellant, Narayanaswamy, who had only passed the high school examination and was not a graduate,
could not be elected at all to the Legislative Council from the graduates’ constituency.

29
 – It would be absurd and destructive of the very concept of representation of specially qualified persons that
an individual who does not possess the essential or basic qualification of the electors should be a
representative of those who are to be represented because of the special qualification of theirs.

Article 171(1) of the Indian Constitution, the total number of members in the Legislative Council of a state
having such a Council, shall not exceed 1/3 rd of the total number of members in the Legislative Assembly of
that state. In the particular provision, qualification of a member of the Legislative Council to be elected was
never stated. In 171(3)(a), it is given that as nearly as maybe 1/3 rd of the members of the Legislative Council
shall be elected by the electorates consisting of members of municipalities, district boards and other local
authorities as specified by the Parliament. In 171(3)(b), it is given that as nearly as maybe 1/12 th shall be
elected by electorates consisting of persons residing in the state who have, for at least three years, been
graduates of any university in the territory of India.

The term ‘electorate’ used in Article 171(3) has neither been defined by the Constitution, nor in any enactment
by the Parliament. Section 2(1)(a) of the Representation of People’s Act, 1951 says that an ‘elector’ in relation
to a constituency means a person whose name is entered into the electoral board of that constituency for the
time being in force and who is not subjected to disqualification as stated in Section 16 of the ROP Act.
Under Section 16, a person may be disqualified if he/she:
– Is not a citizen of India.
– Is of unsound mind and stands to be declared so to by a competent court.
– Is for the time being disqualified from voting under the provisions of any existing law relating to corrupt
practice and other offences in connection with elections.

The Supreme Court set aside the judgement of the Madras High Court, and held that the language as well as
the legislative history of Article 171 and 173 and Section 6 of the ROPA enabled a presumption of a deliberate
omission of the qualification that the representative of the graduates should also be a graduate. No absurdity
results if such an intention is presumed. It cannot be inferred from the mere fact of such an omission and
opinions underlying Article 171 of our Constitution, that the omission was either unintentional or that it led to
absurd results. [Suggesting that golden rule must not be applied when it is not required]

They also held that by adding a condition to be necessary or implied qualification of a representative of the
graduate, the HC judge had really invaded the legislative sphere. The defect, if any, in the law could be
removed only by law made by the Parliament.

 Advantages of using the golden rule:

– It respects the words of the parliament, except in limited situations. It provides an escape from situations
where there is a problem with using the literal meaning.
– It allows the judge to choose the most sensible meaning where there is more than one meaning to the
words in an Act or Statute.
30
 – It can also provide reasonable decisions in cases where the literal rule would lead to repugnant situations,
by importing wider meaning to the terms of a statute [Example: Re Sigsworth].
– The main advantage of the golden rule is that drafting errors in statutes can be corrected immediately.
[Example: In R. v. Allen, the loopholes were closed and the decision was in line with the Parliament’s
intentions and it gave a more just outcome].

 Disadvantages of using the golden rule:

– There are no real guidelines as to when it can be used.
– What seems to be absurd to one judge may not be to another; a case’s outcome is dependent upon the
judge, rather than the law.
– It is very limited in it is use, so it is only used on rare occasions.
– It is not always possible to predict when courts will use the golden rule, making it hard for lawyers and
people who are advising their clients.
– The golden rule won’t help if there is no absurdity in the statute. [Example: In London and North Eastern
Railway v Berriman, the widow couldn’t get compensation because the wording of the statute didn’t allow
for this circumstance].
– Judges can technically change the law by changing the meaning of words in statutes. In doing so, they can
potentially infringe the separation of powers between legal and legislature.

HEYDON’S PRINCIPLE / MISCHIEF RULE

 The purpose of this rule is to suppresses the mischief and advance the remedy.
 The rule was developed in the Heydon’s case during the reign of Henry VIII. It seeks to look into the purpose
with which the rule was developed. The case laid down four principles which were to be considered when
applying the mischief rule:
– What was the law before making the Act? Look at previous versions of the Act in question.
– What was the mischief or defect for which the law did not provide? Why was a new version of the Act
required?
– What remedy has the Parliament resolved and appointed to cure?
– What are the true reasons (rationale) for the remedy?
 When the language used in a statute is capable of two meanings and the rule of literal interpretation fails, we
resort to the mischief rule.

 Smith v. Hughes. Under the Street Offences Act, 1959, loitering or soliciting in public places by prostitutes
was made an offence. Prostitutes were soliciting customers from their balconies, which were their private
property. The law only prohibited such solicitation in public spaces. Under the literal rule, their conduct would
be permitted. However, it was understood under the mischief rule that the object was to curb such activities and
they were held liable for the same.

31
 Royal College of Nursing v. DHSS. The Royal College of Nursing brought an action challenging the legality
of the involvement of nurses in carrying out abortions. The Offences Against Persons Act, 1861 (which came
at a time when abortion was not legalised) made it an offence to carry out abortions.
The Abortion Act, 1967 made it an absolute defence for a medically registered practitioner to carry out
abortions, provided certain conditions were satisfied. The question was whether nurses would be considered to
be ‘medically registered practitioners’. It was held that it was legal for nurses to carry out abortions as the
purpose was to eliminate backstreet abortions and protect the health of women. Nurses and doctors, thus, were
considered to be ‘medically registered practitioners’.

 Elliot v. Grey. The defendant's car was parked on the road. It was jacked up and had its battery removed. He
was charged with an offence under the Road Traffic Act, 1930 for using an uninsured vehicle on the road. The
defendant argued he was not ‘using’ the car on the road as clearly it was not driveable. The court applied the
mischief rule and held that the car was being used on the road as an uninsured vehicle represented a hazard and
therefore insurance would be required in the event of an incident. The statute was aimed at ensuring that people
were compensated when injured due to the hazards created by others.

 DPP v. Bull. A man was charged with an offence under Section 1(1) of the Street Offences Act, 1959 which
makes it an offence for a ‘common prostitute to loiter or solicit in a public street or public place for the
purposes of prostitution’. The magistrates found him not guilty on the grounds that ‘common prostitute’ only
related to females and not males. On appeal, the court held that the Act applied only to females. The word
‘prostitute’ was seen to be ambiguous.

They applied the mischief rule to look at the purpose behind the introduction of the Act and found that it was
introduced as a result of the work of the Wolfenden Report into homosexuality and prostitution. The Report
only referred to female prostitution and did not mention male prostitutes. Therefore, it was held the mischief
the Act was aimed at was curtailing was the behaviour of only female prostitutes.
 
 Corkery v. Carpenter. Section 12 of the Licensing Act, 1872 made it an offence to be drunk under carriage on
a highway. There was an ambiguity regarding the word ‘carriage’. The question was whether riding a cycle
would fall under the phrase ‘carriage’. Applying the literal rule, he would not have been charged. However, the
mischief sought to be curbed was drinking and driving and under the mischief rule, he was charged with the
offence under Section 12 of the Act.

 Sodra Devi v. CIT. This was a pre-GST case. Under Section 16(3) of the Income Tax Act, 1922, in computing
the total income of an individual (which is taxed) for the purpose of assessment, there shall be included so
much of the income of a wife or a minor child of such individual as arises indirectly or directly. The question
before the Court was whether the word ‘individual’ included males and females both, or whether it was
restricted to males only.

32
 The Court observed that the legislature was guilty of using an ambiguous term. It was held that the words ‘any
individual’ is to be restricted in its connotation to refer to males only. This was because of the widespread
practice of husbands entering into nominal partnerships with their wives and fathers admitting their minor
children to the benefits of the partnerships of which they were members. If this background of the enactment of
Section 16(3) is borne in mind, there is no room for any doubt that the only intention of the legislature was to
include the income derived by the wife or minor child, in computation of the total income of the male assessee
(the husband or the father, as the case may be) for the purpose of assessment.

 Bengal Immunity Co. v. State of Bihar. Article 286 of the Constitution of India deals with inter-state tax.
When goods are supplied from one state to another, they cannot be taxed. This was done to avoid the mischief
of multiple taxation. The appellant company is an incorporated company carrying on manufacturing and selling
various vaccines, medicines and biological products. Its factories and labs were headquartered at Kolkata. It
was registered as a dealer under the Bengal Finances Sales Tax Act. Its product has extensive sales across India
and elsewhere. The orders were accepted in Kolkata and dispatched from there. The appellant company did not
have any agent, broker or subsidiary company in Bihar. The Assistant Superintendent of Commercial Taxes,
Bihar wrote to the appellant company and asked it to get registered under the Bihar Sales Tax Act and hence
pay sales tax duty there as well.

The question was whether the tax threatened to be levied on sales made by the appellant company by delivery
in the manner mentioned in the petition is leviable by the state of Bihar. It was decided that the Bihar Tax Act,
insofar as it purports to tax sales or purchases that take place in the course of inter-state trade or commerce,
was unconstitutional, illegal and void. When construction was given to article 286 of the Constitution, it was
found that it was enacted to prevent multiple and arbitrary taxes by states; no law of the state shall authorise the
imposition of tax on the sale or purchase of goods. Bihar lacked the authority to impose such tax but was doing
so anyway.

 Advantages of using the mischief rule:

1. The Law Commission sees it as a far more satisfactory way of interpreting Acts as opposed to the golden
or literal rules. 
2. It usually avoids unjust or absurd results in sentencing.
3. It closes loopholes.
4. It allows the law to develop and adapt to changing needs [Example: Royal College of Nursing v. DHSS].

 Disadvantages of using the mischief rule:

1. It is seen to be out of date as it has been in use since the 16th century, when common law was the primary
source of law and parliamentary supremacy (in England) was not established.
2. It gives too much power to the unelected judiciary which may be argued to be undemocratic.

33
 3. It creates a crime after the commission of the activity, violating the principle of rule of law
[Examples: Smith v. Hughes and Elliot v. Grey]. 
4. It gives judges a law-making role, infringing the doctrine of separation of powers; judges can bring their
own views, senses of morality and prejudices to a case [Examples: Smith v. Hughes and DPP v. Bull].

HARMONIOUS CONSTRUCTION
 While all the previous rules were of English origin, this rule was developed by Indian jurisprudence.
 It is a well-settled rule of construction that the provision of a statute should be so construed as to accord with
the object of the enactment.
 The object of harmonious construction is to avoid conflict between two enacting provisions of a statute as far
as possible and to construe the provision in a way that they harmonise.
British Airways v Union Of India (2002)
 Venkatramana Devaru v. State of Madras.
– Article 25 recognises the right to freedom. Article 25(2)(b) accords to the state a power to make
legislation, in the interests of social welfare and reform, throwing open Hindu religious institutions of
public character to all classes and sections of Hindus.
– Article 26 accords to every religious denomination the right, among other things, to establish and maintain
institutions for religious purposes and to manage their own affairs in matters of religion.
– The appellants were trustees of temple, and belonged to the Gowda Saraswath Brahmin community. In
1950, a decree was passed by a civil court declaring the temple to be an ancient institution belonging to
the Gowda Brahmins. Moreover, general control and management of the temple’s religious and secular
affairs was given to the members of the community.
– The Madras Legislature passed the Madras Temple Entry Act of 1947, which, at section 3(1) stated that
“notwithstanding any law, custom or usage to the contrary, persons belonging to excluded classes shall be
entitled to any enter any Hindu temple and offer worship therein as Hindus”.
– The Supreme Court examined the validity of this Act, which was introduced with a view of removing the
disabilities imposed by custom or usage on certain classes of Hindus against entry into a Hindu temple.
– Applying the harmonious rule of construction, it was held that full effect can be given to Article 26(b) in
all matters of religion, however, as regards to entry of excluded classes into the temple for worship, the
rights declared under Article 25(2)(b) shall prevail. Hence, Article 26(b) must be read subject to Article
25(2)(b). The right protected by Article 25(2)(b) is a right to enter into a temple for purposes of worship
and hence, should be construed liberally in the favour and welfare of public.
– It was observed that when there is an enactment, two provisions which cannot be reconciled with each
other, they should be so interpreted, that if possible, effect should be given to both.
– According to this rule, a statute should be read as a whole, and one provision of the Act should be
construed with reference to other provisions in the same Act so as to make a consistent enactment of the
whole statute. Such an interpretation id used in avoiding inconsistency or repugnancy, wither within a
section or in other parts of a statute.

34
 CIT v. Hindustan Bulk Carriers.
– It was held that the court must avoid a head-on clash on seemingly contradictory provisions and they must
construe the contradictory provisions so as to harmonise them.
– The provision of one section cannot be used to defeat the provision contained in another, unless the court
despite all its efforts is unable to find a way to reconcile their differences. When it is impossible to
completely reconcile the differences in contradictory provisions, the court must interpret them in such a
way so that the 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 lumber or a dead
letter is not in conformity with the spirit of harmonious construction. To harmonise is not to destroy any
statutory provision or to render it fruitless but where it is not possible to give effect to both conflicting
provisions, then head on collision should be avoided by holding that:
 Apparently conflicting provisions deal with separate situations.
 One conflicting provision merely provides for an exception of general rule contained in another
provision. This principle is expressed in the maxims generalia specialbus non derogant (general
things do not derogate from special things) generalibus specialia derogant (special things derogate
from general things). From these maxims we get that preference is to be given to the special thing.

 M.S.M. Sharma v. Krishna Sinha.

– This case pertained to Article 194(3), i.e., Parliamentary privileges.
– The petitioner and editor of a newspaper was asked to show cause as to why he should not be punished for
a breach of privilege of House under Article 194(3) for publishing a speech made in State Legislative
Assembly without expunging certain remarks as directed by the speaker.
– In the petition under Article 32 of the Constitution, he argued that the proposed action against him would
be contrary to the freedom of speech and expression guaranteed under Article 19(1)(a) of the Constitution.
– The SC held that Article 19(1)(a) and 194(3) had to be harmoniously interpreted. To give effect to both of
these provisions, it was necessary to hold that the fundamental right of speech and expression under
Article 19(1)(a) was subject to privileges of Houses guaranteed by Article 194(3).
– The provisions of Article 19(1)(a), which are general, must yield to Article 194(3), which are special. The
petition was, therefore, dismissed.

 Sirsilk Ltd. v. Govt. of Andhra Pradesh.

– This case pertained to Sections 17(1), 17(2) and 18 of the Industrial Disputes Act.
– Section 17(1) states that every award shall (mandatory provision) within a period of 30 days from the date
of its receipt by the appropriate government, be published in such a manner as the appropriate government
thinks fit.
– Section 17(2) states that an award published under 17(1) shall be final and shall not be called in question
by any court in any manner.

35
 – Section 18 provides that a settlement arrived at by agreement between the employer and the workmen
otherwise than in the course of conciliation proceedings shall (mandatory provision) be binding on the
parties to the agreement.
– In this case, a settlement was reached after the award was passed by the Tribunal and the conflict arose.
The question was whether the Government should publish the award or not.
– The Court applied the rule of harmonious construction and provided that even though section 17 made it
mandatory for the Government to publish the award, the present matter was a special circumstance, not
covered under the provisions of the Act. The binding nature of section 18 would now take precedence.
– The Court reasoned that this was because the award was no longer operative and rendered infructuous
because there did not exist a dispute which needed an award anymore and an amicable settlement by the
parties would indeed be better. Therefore, the Court tried to harmonise, in the abovementioned manner,
the two provisions holding that the publication of the award must be withheld.

 K. M. Nanavati v. State of Bombay.

– Article 161 deals with pardoning of sentence by the Governor. Article 142 deals with the special powers
of the Supreme Court in regard to any case or matter pending before it and encompasses the power to
make any such order as may be necessary for doing complete justice. This power naturally includes the
power to suspend a sentence against an accused person.
– The Governor of Bombay passed an order suspending the life sentence given to Commander Nanavati
during the pendency of his appeal before the Supreme Court, i.e., the matter was sub-judice.
– Applying the rule of harmonious construction, the Court observed that the Governor cannot use his power
under Article 161 when the matter is sub-judice. Thus, the order of the Governor of Bombay was held to
be void.

 Calcutta Gas Company v. State of West Bengal.

– The matter at hand pertains to entries 24 (industries) and 25 (‘gas’ and ‘gas works’) of List II of the
Constitution of India.
– The Oriental Gas Company was originally constituted and registered in England, and was empowered by
an Act to lay gas pipelines in Calcutta. The West Bengal government passed the impugned Act, which was
the Oriental Gas Company Act, 1960, via which the management of Oriental Gas Company was taken
over by Calcutta Gas Company for a period of 5 years. The appellant, by a petition under Article 226 of
the Constitution impugned the constitutional validity of the said Act.
– In this case, interpreting the Entries 24 and 25 of List II harmoniously, it was held that ‘gas works’ and
‘gas industries’, being a specific entry under entry 25, wouldn’t fall under the general category of entry 24
relating to industries because if the word ‘industry’ under Entry 24 would be interpreted to include ‘gas
works’, then Entry 25 would become redundant.
– On the other hand, alternative contention allows Entries 24 and 25 to operate fully in their respective
fields. While Entry 24 governs a very wide field, i.e., every industry in the state, Entry 25 is confined to a

36
 specific industry that is the gas industry. They therefore held that the impugned Act was within the
legislative competence of the West Bengal legislature and thus validly made.
– It was observed that entries of scheduled lists must be read together and the language of one interpreted,
and when necessary, modified by that of other, should not make a construction which makes any of the
entries redundant, which might mean to construe one entry in a ‘restricted’ sense, and as ‘wider’ meaning
may lead to overlapping.

Reasonable/ equitable/BENEFICIAL CONSTRUCTION

 A beneficial statute is a class of statutes which seeks to confer benefit on individuals and classes of persons by
relieving them of onerous obligation under contracts entered into by them (they get this statement from labour
legislations) or which tend to protect persons against oppressive acts from individuals with whom they stand in
certain relations.
 The established principle in the construction of such statutes is that there should not be any narrow
interpretation. Construction of beneficial statutes should not be done in a narrow sense. The court should
attempt to be generous towards the persons on whom benefit should be conferred. Eg workmen compensation
act
 When a statute is interpreted liberally to give the widest possible meaning to it, it is called ‘beneficent
construction’. Beneficial construction is an interpretation to secure remedy to the victim who is unjustly denied
of relief. When there are two or more possible ways of interpreting a section or a word, the meaning which
gives relief and protects the benefits which are purported to be given by the legislation should be chosen.
 A beneficial statute has to be construed in its correct perspective so as to fructify the legislative intent.
Although beneficial legislations do receive liberal interpretation, the courts try to remain within the scheme and
not extend the benefit to those not covered under the scheme.
 This rule can only be resorted to without doing any violence to the language of the statute.
 In case of any exception, when the implementation of the beneficial act is restricted by the court, it has to be
construed narrowly so as to not unduly expand the area of scope of the exception.
 There are different kinds of legislation which receive beneficial construction. Generally, laws which promote
general welfare and deal with urgent social demands receive such construction.
 In case of legislations which may have two different interpretations, the interpretation of the legislation which
favours the class of persons which are protected via this legislation is preferred.
 The interpretation of socio-economic legislations, which are aimed at social or economic policy changes,
should not be narrow.

 Hindustan Lever Ltd. v. Ashok Vishnu. The Court held that in a case related to prevention of unfair labour
practice, while interpreting social welfare legislations, a construction should be placed on the relevant
provisions which furthers the purpose for which the legislation was enacted.
 Sant Ram v. Rajinder Ram. The Supreme Court said that a welfare legislation must be interpreted in a third-
world perspective, favouring the weaker and poorer class. It has also been laid down that in case of such labour

37
 legislations, courts should not stick to grammatical construction but also have regard to teleological purpose
(relating to or involving the explanation of a phenomenon in terms of the purpose they serve rather than of the
cause by which they arise) and protective intendment (whom is the legislation protecting?) of the legislation.

 In case of a beneficial-oriented legislation like the Consumer Protection Act of 1956, the provisions are
supposed to be construed as broadly as possible.

 Spring Meadows Hospital v. Harjol Aluhwalia (1998). In this case, interpreting one of the sections of the
Act, it was held that parents who hired the services of a hospital and the child for whom the services are hired,
both are consumers independently and hence can independently claim damages.

 B. Shah v. Presiding Officer, Labour Court. This case was in relation to section 5 of the Maternity Benefit
Act, with respect to the amount of wages to be given to a mother [Under the Act, wages are to be paid to an
expecting mother for the days she is on leave 6 months before and after delivery]. The question was whether
Sundays were to be accounted for in the computation of wages. It was held, giving a broad construction to the
Act, that Sundays would be taken into account in the computation of wages to be paid.

 Union of India v. Prabhakaran Vijaykumar. This case pertained to section 123 of the Railways Act, 1989. It
was provided that if an ‘untoward accident’ happens and a passenger inside a train is injured due to some fault
of the railways, the passenger must be compensated. Here, a man had fallen while boarding the drain and died.
The question was whether an accident while boarding the train would fall within the ambit of the term
‘untoward accident’ (accident while boarding would be due to the fault of the passenger, and not the railways).
Giving a liberal construction, it was held that since the ‘benefit’ is to give compensation, it would be
considered an ‘untoward accident’.

 Amritham Kudumbah v. S. Kudumbah.

– Herein, section 8(3) of the Hindu Minority and Guardianship Act was in question.
– The child in this case was the owner of some property given to him by his grandfather, but because of his
minority, his father was made the trustee of that property till the child attained majority.
– A clause was incorporated in the deed, which stated that under no circumstances would the father sell the
property. However, if there arose any legal necessity to sell that property, the father would have to take the
permission of the court.
– The legal necessity was meant to be for the benefit of the minor child.
– The father sold the property without there being any legal necessity, and without the court’s permission.
– The question was whether the child, after attaining majority, could declare this sale void. The Court held
that section 8(3) was to be construed liberally, and the child could not be denied the right to declare the
sale void as the provision of the said legislation was for the benefit of the minor child.

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PURPOSIVE CONSTRUCTION
Workmen of Dimakuchi Tea Estate v. Management of Dimakuchi Tea Estate, the
Hon’ble Supreme Court of India held that the words of a statute, whenever there is a
doubt about their meaning, have to be understood in the sense in which they best
harmonise with the subject of the enactment and the object which the legislature has
in its view. It was stated that “the meaning of the statute is not found in a strict
grammatical or etymological propriety of language, nor even in its popular use, as in
the subject or in the occasion on which they are used, and the object to be attained.” It
has been recognised by the Supreme Court of India on multiple occasions that
whenever two interpretations are feasible the court will prefer such interpretation which
advances the remedy and suppresses the mischief as it was envisioned by the
legislature. It has been provided that the Court should adopt an object-oriented
approach keeping in mind the principle that legislative futility is to be ruled out so long
as interpretative possibility permits. Thus, it can be inferred that to the extent to which
there is interpretive flexibility, the Court must seek to give such an interpretation to
the statute which helps in the fulfilment of its ultimate objective and thereby prevents
the same from becoming futile.                                                                 
 The purposive approach to statutory interpretation is used in the European Court of Justice. The
literal rule would be of little use in the European Courts since there are several languages in
operation and translation is not an exact science.  Domestic judges are required to apply
the Purposive approach whenever applying a piece of EU law.
Maunsell v Olins [1975] AC 373 House of Lords
 
 The House of Lords had to determine whether a farm cottage attached to farmhouse constituted
‘premises’ for the purposes of the Rent Act. Lord Simon set out the two tier test to be taken under
the purposive approach.
 
Lord Simon:
 
‘The first task of a court of construction is to put itself in the shoes of the draftsman – to consider what
knowledge he had and, importantly, what statutory objective he had …being thus placed…the court
proceeds to ascertain the meaning of the statutory language.’

Cautionary note: purposive construction need not to be applied where a relevant act has been
amended from time to time on the basis of fresh needs and has not remained static.in such
situations literal rule of interpretation has to be applied.
Case Dental council of India v Hari Prakash ( 2001)
Interpreting the Dentist Act purposive construction cannot be applied because what is not included
by the legislature cannot be undone by the court by adopting the principle of purposive
interpretation.

 All India Reporter Karamchari Sangh v. All India Reporter Ltd. (1988).
– The question that arose for consideration in this case whether law reports are ‘newspapers’ under the
Working Journalists and Other Newspapers Employees (Conditions of Service) and Miscellaneous
Provisions Act, 1955. Further, to that end, whether judgements of the Supreme Court and High Courts
were ‘news’.
– Employees of newspaper establishments had been given certain benefits under the aforementioned Act. A
second question arose as to whether the employees of the respondents engaged in the production or

39
 publication of the said law reports are entitled to benefits conferred upon the employees of newspaper
establishments by the Act.
– The object of the Act was to regulate certain conditions of employees and working journalists and other
employees employed in the newspaper establishments.
– ‘Newspaper’ means any printed periodical work containing public news or comments on public news and
includes such other classes of printed periodical work as may be notified by the central government from
time to time.
– ‘Newspaper employee’ is defined as any working journalist and includes any other person employed to do
any work in or in relation to any newspaper establishment.
– ‘Newspaper establishment’ is defined as an establishment under the control of any person or body of
persons, whether incorporated or not for the production or publication of one or more newspapers or for
conducting any news agency or syndicate.
– A ‘working journalist’ is one whose principal avocation is that of a journalist and who is employed as
such, either whole-time or part-time, in relation to newspaper establishments and does not include any
such person who is employed in any managerial or administrative capacity.
– It was urged before the High Court that the law reports of the All India Reporter Ltd. did not constitute
‘newspapers’ under the Act. The High Court accepted this plea. The matter went to the Supreme Court on
special leave.
– The question before the Supreme Court was whether judgements of courts could be considered ‘news’,
which was not defined under the Act.
– It was observed that according to the Oxford English Dictionary, ‘news’ means tidings, new information
of recent events or new occurrences as a subject of report or talk. Further, Article 141 of the Constitution
provides that the law declared by the Supreme Court is binding on it and on all courts within the territory
of India.
– The Court held that the law reports being published did constitute ‘new information of recent events’. It
could not be disputed that the decisions were of public importance.

 R. v. Secretary of State of Health (2003).


– In July 1978, the first child was born using the in vitro fertilisation (IVF) technique, where the egg is
fertilised outside the mother’s womb.
– The UK Parliament passed the Human Fertilisation and Embryology Act, 1990 in response to medical
developments in the fertility industry. It prompted a debate regarding the various social, legal and ethical
problems posed by the implications of scientific developments. The Act aimed to regulate and outlaw
certain practices relating to human embryos. However, at the time when the Act was passed, embryos
could only be created by a process of fertilisation with sperm.
– After the Act was passed, a new scientific process, known as ‘cell nucleus replacement’ was developed.
Under CNR, an embryo could be created without fertilising the egg; merely replacing the nucleus of one

40
 egg with another was sufficient. The first instance of the use of this process was the cloning of Dolly the
sheep.
– The Human Fertilisation and Embryology Authority (set up by the Act; it granted the license to research
with regard to embryos), it was claimed, did not have the authority to license the research with regards to
cloning under the terms of the Act.
– Under the Act, an ‘embryo’ was defined as a ‘live human embryo where fertilisation is complete’. The
problem was that embryos created using cloning were not fertilised.
– The House of Lords said that the court’s task within the permissible bounds of interpretation was to give
effect to the Parliament’s purpose. So, the controversial provision should be read in the context of the
statute of the whole and the historical context of the situation at hand. Thus, the cloned embryos were
covered by the Statute, by applying the purposive rule of statutory interpretation.
–
R v S of S for Health ex parte Quintavalle (on behalf of Pro-Life Alliance) [2003] 2 WLR 692 House of
Lords

The Pro Life Alliance argued that the Human Fertilisation and Embryology Authority did not have
authority to licence research with regards to cloning. The Human Fertilisation and Embryology Act 1990
granted the Authority the right to licence research with regards to embryos. An embryo was defined in
the Act as ‘a live human embryo where fertilisation is complete’. However, embryos  created using
cloning are not fertilised.
Held:

The House of Lords held that the cloned embryos were covered by the statute taking a purposive
approach to statutory interpretation.

Lord Bingham:

"The court's task, within the permissible bounds of interpretation, is to give effect to Parliament's
purpose. So the controversial provisions should be read in the context of the statute as a whole, and the
statute as a whole should be read in the historical context of the situation which led to its
enactment….While it is impermissible to ask what Parliament would have done if the facts had been
before it, there is one important question which may permissibly be asked: it is whether Parliament,
faced with the taxing task of enacting a legislative solution to the difficult religious, moral and scientific
issues mentioned above, could rationally have intended to leave live human embryos created by CNR
outside the scope of regulation had it known of them as a scientific possibility. There is only one possible
answer to this question and it is negative."
–

Beneficial Construction Purposive Construction

Golden Rule, applied in case of absurdity. Mischief Rule.
Purpose + object + benefit for a particular class. Purpose + Object.
Broader Interpretation, so that justice can be given to
minorities or a class of society.

41
 SECONDARY PRINCIPLES
NOSCITUR A SOCIIS
The principle of Noscitur a Sociis is a rule of construction. It is one of the rules of language used by
court to interpret legislation. This means that, the meaning of an unclear word or phrase should be
determined by the words immediately surrounding it. In other words, the meaning of a word is to be
judged by the company it keeps. The questionable meaning of a doubtful word can be derived from its
association with other words. It can be used wherever a statutory provision contains a word or phrase that
is capable of bearing more than one meaning.
This rule is explained in Maxwell on the interpretation of statutes in following words – When two or
more words susceptible of analogous meaning are coupled together, they are understood to be used in
their cognate sense. The words take their colour from and are quantified by each other, the meaning of the
general words being restricted to a sense analogous to that of the less general.

 This maxim, which is broader than the principle of ejusdem generis, provides that the meaning of an
ambiguous word may be determined by looking into the company the word keeps.
 ‘Noscitur’ means ‘to know’ and ‘ a sociis’ means ‘association’.
 Meaning of doubtful words may be ascertained by reference to the meaning of words associated with it.
 Questionable meaning of words or doubtful words can be derived from its association with other words within
the context of the phrase.
 If multiple words having similar meaning are put together, they are to be understood in their collective.
 The rule means that when two or more words susceptible to analogous meanings, are clubbed together, they are
understood to be used in their cognate sense (i.e., coming from similar origin).
 Note : It cannot be used when it is clear that a word with a wider meaning is deliberately used in order to
increase the scope by the legislature (Mazdoor Sabha Case).
 For instance, in maritime law, there is a concept of ‘vessels’. The Maritime Act defines vessels, cargo, bots,
ships and ‘xyz’. How is this term ‘xyz’ to be interpreted? The common denominator in all these terms is a
voyage in water. So if meaning is to be given to ‘xyz’, it will be figured out by looking at its associations, i.e.,
the company it keeps.
 Applying the noscitur rule, the court looks at:
– Analogous words (comparable meaning).
– Common origin of the word.
– Company or association the word keeps.
– Context of the word.
However, applying the rule of ejusdem generis, the court only looks at the surrounding words, without looking
at the context or the legislative intent.

 State of Assam v. R. Muhammad.

– In this case, the words ‘post’ and ‘posting’ were being interpreted.
– It is understood that posting can have two connotations – posting (transfer) of an official from one place to
another, and appointment to a particular post.

42
 – Article 233(1) of the Constitution of India provides that the appointment, posting and promotion of judges
shall be made by the Governor of the state.
– In this context, the Court held that ‘posting’ meant appointment in the latter connotation, and not transfer.
The power to transfer was vested with the High Court, and could not be exercised by the Governor.

 Relying on the above, in the case of Commissioner of Income  Tax v. Bharti cellular it was held that term
‘technical servies’ used in section 194J of the Income Tax Act is unclear. The word technical would take
colour from the words managerial & consultancy between which it is sandwiched. These terms ‘managerial
services’ & ‘consultancy services’ necessarily involve a human intervention . So applying noscitur a
sociis the word ‘technical’ would also have to be construed as involving a human element. Thus,
interconnection & port access services rendered by the assessee do not involve any human interface &
therefore cannot be regarded as technical services u/s 194J of the Income Tax Act.
 Coupling of word together shows that they are to be understood in the same sense and where the meaning of
particular word is doubtful or obscure or where a particular expression when taken singly is inoperative, its
intention is to be ascertained by looking at adjoining words or at expressions occurring at other parts of the
same instrument.
 If one could pick out a single word or phrase & finding it perfectly clear in itself, refuse to check its apparent
meaning, in the light thrown upon it by the context or by other provisions then the principle of noscitur a
sociis would be utterly meaningless. This principle requires that a word or phrase or even a whole provision
which standing alone has a clear meaning , must be given quite a different meaning when viewed in the light
of its context.

 The apex court in Pradeep Agarbatti with reference to the Punjab Sales Tax Act held that the word,
“perfumery’’ means such articles as used in cosmetics and toilet goods viz, sprays, etc but does not include
‘Dhoop’ and ‘Agarbatti’. This is because in Schedule ‘A’ Entry 16 of Punjab Sales Tax Act reads as
“cosmetics, perfumery & toilet goods excluding toothpaste , tooth powder kumkum & soap.”

 Delhi Tribunal in the case of, Parsons Brinckerhoff India (P.) Ltd. vs. Asstt. DIT (Int. Tax) applying the
rule of Noscitur a Sociis held that, the words ‘model’ and ‘design’ cannot fall under definition of ‘royalty’
under Explanation 2 to section 9 (I) (VI) of the Income Tax Act. They have to take colour from the other
words surrounding them, such as, patent, invention, secret formula or process or trade mark, which are all
species of intellectual property.

 Note : Noscitur a sociis cannot prevail in case where it is clear that the wider words have been deliberately
used in order to make the scope of the defined word correspondingly wider. It can also be applied where the
meaning of the words of wider meaning import is doubtful; but, where the object of the Legislature in using
wider words is clear and free from ambiguity, the rule of construction cannot be applied.

 State of Bombay v. Hospital Mazdoor Sabha.

43
 ‘Industry’ means, “any business, trade, undertaking, manufacture, or calling of employers and includes
any calling, service, employment, handicraft or industrial occupation of workmen”. Security of the
individual is a basic human right and the protection of individuals is, accordingly, a fundamental
obligation of Government. The main concept of industrial legislation is to fasten together both labor and
capital in order to create an atmosphere that they are indivisible whole in the production. It is the
branch of law which embraces such a wide and effective role in social engineering and social action.
Industrial law distinguishes itself from other branches of law as it is the body of legal enactment and
judicial principles which deals with employment and non-employment, wages, working conditions,
industrial relations, social security’s and labor welfare of employees. It is in a state intervention to put
restrictions on employer on one hand and workman, on the other hand, to prevent exploitation to attain
industrial peace. Industrial legislation aims at protecting the workers from exploitation and strengthens
the values of industrial relations. The legislation provides effective tool to settle industrial disputes and
tries to provide safe and healthy industrial atmosphere.
Sec.2 (j) of the Industrial Disputes Act, 1947 defines ‘industry’ as “any business, trade, undertaking,
manufacture, or calling of employers and includes any calling, service, employment, handicraft or
industrial occupation or avocation of workmen”. This definition is too generic and has led to numerous
contradicting interpretations. An industry exists only when there is relationship between employers and
employees, the former is engaged in business, trade, undertaking, manufacture or calling of employers
and the latter is engaged in the calling, service, employment, handicraft or industrial occupation and
avocation. This definition is both exhaustive and inclusive. The words used are of widest amplitude. A
considerable amount of difficultly was faced while interpreting these different words. No doubt, the task
of interpretation is straightforward. But because of varied forms of industry, especially after rapid
industrial progress and widest language used in the definition, the concept of industry expanded in all
directions. The present definition continues to be as originally enacted in the Industrial disputes Act
1947. Though this definition has not undergone any amendment, it has undergone variegated judicial
interpretations.
The definition of “industry” has evolved and expanded significantly over a period of time by the
legislative acts and judicial decisions. The journey of such evolution has been symbolic primarily because
of lack clarity in the legislative intent as embodied in the law and conflicting judicial approaches
regarding the ambit of such definition.
STATE OF BOMBAY v. HOSPITAL MAZDOOR SABHA
In 1960, Hospital Mazdoor Sabha Case brought hospitals within ambit of industry. This case involved
payment of retrenchment compensation to workmen in JJ Hospitals, Mumbai. The Management
pleaded that the Hospital was not involved in any trade or business and hence they are not industry.
Court framed a working principle that any systematic activity for production or distribution of goods or
services done with help of employees in the manner of a trade or business is an industry. The services in
the hospital were held to be material service and hence Hospitals are industry under the Industrial
Disputes Act.

44
 The reason for giving a wide interpretation to the word Industry was that the Court wanted to bring
organizations within fold of ID Act so that a large number of agitations and strikes could be curtailed
and industrial peace could prevail.

Interpretational Principles
With the use of external aids i.e., dictionary, the phrase ‘industry’ was interpreted as stated
in Section 2(j) of the Industrial Disputes Act, 1947:

1. The words used in the definition of the term are very wide in their import. The Court opined that if
there is such deliberate usage of words of such wide import, then prima facie, it is necessary to
abide by interpretation of such wide denotion.
2. The Court used the external aid of Interpretation, ‘Webster dictionary’ to define certain terms
under Section 2(j). The term ‘undertaking’ was meant to be any business or any enterprise in
which one engages or works in. Further, to define the term ‘trade’, the Court quotes the definition
as provided by Halsbury. The primary meaning is exchange of goods for money or goods for
goods, and the secondary meaning states that any business carried on with the purpose to profit
from the money.
3. The definition of the term ‘business’ was taken to be of wider import, and an activity which is an
occupation and not a pleasure.
4. In the present appeal, the Court relied upon an inclusive interpretation of Section 2(j) to mean that
the words are used in an inclusive definitive way denoting an extension; therefore the meaning of
the words cannot be restricted in any sense.
The Court further used the principle of ‘noscitur a sociis’  to determine whether Hospitals
would form part of Industry or not.

1. The Court referred to Maxwell’s definition of the principle, which states that the meaning of an
unclear or ambiguous word in a statute should be determined by considering the words with which
it is associated in the context.[1] This principle aims to define the more general words of a statute
within the ambit of the meanings of more narrow and specific words.
2. The Court was of the opinion that noscitur a sociis is merely a rule of construction which can be
applied where the meaning of words of wider import has to be ascertained or the intention of the
Legislature is doubtful.
3. The Court relied upon observations in the case of Corporation of Glasgow v. Glasgow Tramway
and Omnibus Co. Ltd, wherein the learned judge held that meanings of such words wide in their
import, shouldn’t be qualified or cut down by their being associated with other words.[2]
4. The Court opined that philosophy behind the principle of noscitur a sociis is that the meaning of
doubtful words may be ascertained by reference to the meaning of words it associates itself with.

– The question was whether the group of hospitals was an ‘industry’ within the meaning of section 2(7) of
the Industrial Disputes Act. An industry was defined as any business, trade, undertaking, manufacturing
unit, or any calling of employers that includes services.
– The argument was that certain essential features or attributes are invariably associated with the words
‘business’ or ‘trade’ as understood in popular and conventional sense and it is the colour of the attributes
that has to be taken under noscitur a sociis.
– It must be borne in mind that noscitur a sociis is merely a rule of construction and cannot prevail in cases
where it is clear that the wider words have deliberately been used in order to make the scope of the defined
word correspondingly wider.

45
EJUSDEM GENERIS
 The term literally translates to ‘of the same kind’.
 If the law lists specific classes of persons or things, and then refers to them in general, the general statement or
words only apply to the same kind of persons or things specifically listed.
 The rule is that where the particular words have common characteristics (i.e., they form a class), and the
general word that follows should be construed as referring to that particular class.
 This rule applies in situations wherein there is a common or general word, after a series of specific words. The
specific words act as a genus for interpretation of the general word.
 Examples:
– Under article 24 of the Constitution, “no child shall be employed to work in any factory or mine, or
engage in any other hazardous employment”. The rule of ejusdem generis will apply here, since there is a
valid genus.
– In the interpretation of the phrase “theatre or any other places of public announcement”, the rule of
ejusdem generis will not apply since there is no valid genus.
– Circuit City stores Inc v Adams (
– N.w Railways v Train dispatchers

 State of Bombay v. Ali Gulshan.

– This case involved the interpretation of section 6(4)(a) of the Bombay Land Requisition Act, 1948, under
which, “the state government may requisition, for the purpose of state or any other public purpose…”. The
general phrase here, was ‘public purpose’. It was contended that under the provision, the Appellant was
entitled to requisition premises for housing a member of a foreign consulate.
– The High Court held that we can apply the ejusdem generis rule and that the expression ‘any other public
purpose’ should be read, ejusdem generis, with the purpose of the state and providing accommodation to a
member of a foreign consulate, being the primary purpose of the union (and not of the state), the state
government had no authority to requisition the premises.
– The Supreme Court held that the High Court was in error in applying the ejusdem generis rule because the
general expression of ‘any other public purpose’, follows only a single expression ‘for the purpose of the
state’, which is not a distinct genus. In the absence of a distinct genus, there is no application of the
ejusdem generis rule.

 The Archbishop of Canterbury Case. This case provides for certain conditions for the doctrine of ejusdem
generis to apply. They are:
– The statute contains an enumeration by specific words.
– The members of the enumeration suggest a class.
– The class is not exhausted by enumeration.
– A general reference supplementing the enumeration generally following it.

46
 – There is no clearly manifested intent that the general term be given a broader meaning that the doctrine
requires.

 Lilavati Bai v. Bombay State.

– In this case, the petitioner was a widow of a tenant of a certain premises, which she had vacated. Finding
the premises vacant, the respondent requisitioned it under section 6(4)(a) of the Bombay Land Requisition
Act, 1948 for the public purpose of housing a government servant.
– One of the explanations to the sub-section stated that there would be deemed to be a vacancy when the
tenant ceases to be in occupation upon termination of his tenancy, eviction, assignment or transfer in any
other manner of his interest in his premises or otherwise.
– On looking at the intent of the provision, it is evident that they had the right to take over the property.
– Legislature intended to give it the widest possible amplitude. Hence, the rule of ejusdem generis does not
apply.

 Calcutta Municipal Corporation v. East India Company Hotels Ltd. (1994).

– There were three restaurants in a hotel, and there used to be occasional musical and dance shows.
– Section 443 of the Calcutta Municipal Corporation Act, pertaining to obtainment of license, the terms
“theatre, circus, cinema house, dancing hall” were followed by the expression “other similar placed of
public resort, recreation or amusement”. The intention and purpose of the provision were very clear –
there was no ambiguity.
– The question was whether license was required for organising music and dance shows since the primary
purpose of the establishment was to serve as a hotel.
– The High Court answered the question in the negative and in favour of EIC Hotels Ltd. by applying the
rule of ejusdem generis. It held that the general words were intended to have restricted meaning in the
sense that other similar places must fall within the class enumerated by the specific words. It held that a
restaurant, which provides amusement occasionally or incidentally to its primary business as a hotel, it is
not a place of ‘public resort’ under section 443. Hence, license was not required to be obtained.
– On appeal, the Supreme Court held that it was not necessary for the HC to rely on the rule of ejusdem
generis. The provisions of section 443 were clear and unambiguous; there was no occasion to call into
consideration the said rule. The question then was whether the activity could bring the restaurants within
the meaning of ‘dancing halls’. The Court found that the restaurants in the hotel had dance floors, for the
guests’ enjoyment. The entertainment, further, was provided by music (including vocal music). At relevant
times, cabaret shows were also performed at the restaurant to entertain the guests.
– Hence, the Court held that the establishment fell within the ambit of a ‘dancing hall’, which required a
license under section 443 to operate. Simply because the recreation in the nature of dancing was provided
along with a posh dinner, would not make it different from a dancing hall where drink and eatables were
invariably provided.
– Therefore, the Court held that restaurants run by the hotel were places similar to dancing halls and were
bound by section 443 of the Act.
47
48
 AIDS TO CONSTRUCTION

INTERNAL AIDS TO CONSTRUCTION

LONG TITLE
 When there is an ambiguity in the interpretation of an enactment, you look at the long title and not the short
title. The object, scope, and purpose of the NI Act and the Trade Dispute Act can be gleamed from the long
title.
 The long title of the Act, however, cannot control the plain words in the body of a Statute; if they have
mutually exclusive and opposite meanings, preference must be given to the enactment and not the title. If the
two are complementary to each other, then the long title can be used for interpretational purposes.
 Ashwini Kumar Case.
– In this case, the long title of the Supreme Court Advocates Act, 1951 read: “An Act to authorise the
advocates of the Supreme Court to practice as of right in any High Court.”
– The Court recognised that the long title of a statute was an important part of the Act and may be referred
to for the purpose of ascertaining its general scope and for throwing light on its construction, although it
cannot override the specific enactments in a statute.
 Manohar Lal v. State of Punjab.
– In this case, the question of the constitutionality of section 7(1) of the Punjab Trade Employees Act, 1940
arose.
– Section 7(1) provided that every shop or commercial establishment shall remain closed on a ‘closed day’.
The choice of the closed day was to rest with the occupier of a shop or a commercial establishment and
was to be intimated to the prescribed authority, within two months of from the day on which the Act came
into force.
– The appellant herein opened his shop on a closed day and was caught by the authorities.
– He argued that he had a right to work on his closed day, based on the Constitution. He stated that the
provision under section 7(1) violated his right to carry on trade and business guaranteed under article
19(1)(g) and the restriction imposed on him was not a reasonable restriction for public welfare under
article 19(6).
– The long title of the Act read: “An Act to limit the hours of work of shop assistants and commercial
employees and to make certain regulations concerning their holidays, wages and terms of service.” The
long title referred to a shop which had employees. The Appellant’s shop was run by him alone (there were
no employee).
– The Court held that section 7(1) was clear enough; if it was a close day, the shop had to be closed – there
was an express provision. It was observed that no matter that the long title of the Act (extracted by the
Appellant’s counsel) indicated the main purpose of the enactment, it could not control the express
operative provisions of the Act itself.

PREAMBLE
49
 The Preamble is expected to express the scope, object and purpose of the Act more comprehensively than the
Long Title. It may recite the ground and cause of making the statute, the evils sought to be remedied or the
doubts which may be intended to be settled, in the best or most satisfactory manner.
 It is a key to open the minds of the makers of the Act and the issues redressed by them in such enactment.
 However, it is not to influence the meaning otherwise ascribable to the enacting part unless there is a
compelling reason for it.
 If there is a conflict between the enacting provision and the Preamble, the provision will prevail.
 Burrakur Coal Co. v. Union of India.
– Under section 4(1) of the Coal-Bearing Areas (Acquisition and Development) Act, it was provided that
whenever it appears to the Central Government that coal is likely to be obtained from land in any locality,
it may by notification, give notice of its intention to the prospect for coal there. This provision did not
make a distinction between virgin, worked, and unworked land.
– The preamble referred to the Act as one to establish an economic interest for India and greater public
control over the coal-mining industry, by providing for acquisition by the State of ‘unworked’ land
containing or likely to contain coal deposits.
– The argument before the court was that the Act applied only to virgin lands and not to those lands which
were being worked, or had been worked in the past.
– The Court rejected the contention on the ground that the language of the enacting provision was clear and
therefore not controlled by the preamble. On a plain reading of section 4(1), the government can prospect
any land and not just virgin lands.
– The Court observed the following principles:
a) It is permissible to look at the preamble for understanding the import of various provisions, but this
does not mean that full effect shouldn’t be given to any express provision, even though they appear to
go beyond the terms of the preamble.
b) It is one of the cardinal principles of construction that where the language of the Act is clear, the
preamble must be disregarded, i.e., it cannot be invoked to restrict or curtail the scope of an
enactment. Though where the object or meaning or enactment is not clear, the preamble is resorted to,
in order to explain it.
c) Where general language is used in an enactment, which it is clear must be intended to have limited
application, the preamble may be used to indicate the particular instances to which the enactment is
intended to apply.

HEADINGS AND TITLES

 Headings and titles of sections can be used to understand the intent of its particular sections.
 Bhinka v. Chaan Singh
– Under section 180 of the Uttar Pradesh Tenancy Act, 1939, a remedy was provided in the form of
ejectment of a person who was retaining possession of some land otherwise then in accordance with
provisions of the law for the time being in force.

50
 – In this case, the question was whether a person having no title, but retaining possession, could be ejected
under the aforesaid provision.
– The title of the section in question read “ejectment of persons occupying land without title”. The heading,
here, gives clarity to the provision. It was thus argued that persons without title should be brought within
the ambit of the section, and the Court agreed.

MARGINAL NOTES
 They are written text to a section for clarity.
 The modern view of the courts is that marginal notes should have no role to play in interpreting a statute.
 The basis of this view is that they are not a part of a statute because they were not originally drafted by the
legislature, but by the drafters, and can be inaccurate too.
 Exception: Indian constitution
 In Bengal Immunity Company v. State of Bihar, the Supreme Court held that the marginal notes to Article
286 of the Constitution was a part of the Constitution and therefore, it could be relied on for the interpretation
of that Article.
 In Union of India v. Dileep Kumar Singh AIR 2015 SC 1420 – the apex court held that marginal note
appended to Section 47 of Persons with Disabilities (Equal Opportunities, Protection of Rights and Full
Participation) Act, 1955 makes it clear that idea of section 47 was not to discriminate against employees who
acquire disability during service.
 In K. P. Varghese v. IT Officer, it was held that marginal notes cannot control the interpretation of the words
of a section, particularly when the language of the section is clear and unambiguous, but being a part of the
statute, it prima facie furnishes some clue as to the meaning and purpose of the section.

ILLUSTRATIONS
 Illustrations that are appended to a section from part of a statute, although forming no part of the section, and
are of relevance in the construction of the text of the section and should not be readily rejected as repugnant to
it.
 In Shambhunath Mehra v. State of Ajmer, it was held that:
– The case pertained to the Indian Evidence Act.
– A question arose with respect to certain payments. The prosecution, instead of proving the absence of
payments, relied on an illustration to section 106 of the Act, and contended that the burden of proof was
on the appellant to establish that payment had been done.
– The Court held that the illustration to section 106 did not abrogate the well-settled norm that it was the
burden of the prosecution to prove its case.
– It was held that an illustration to a section forms a part of a statute and not of the section, and can be used
for construction of the text of a section very rarely.
– Illustrations cannot have the effect of modifying the language of the section above and they cannot curtail
or expand the ambit of the section.

51
SCHEDULES
 They appear at the end of an Act.
 If it is believed that the Schedule creates a different enactment, then if the schedule and provision are mutually
exclusive to each other, which one would prevail?
 Section 135 of the Companies Act talks about CSR. It is inclusive, and not exhaustive. Additionally, Schedule
VII enumerates a list of activities that could fall under CSR. Nothing in the list pertains to the welfare of
manual scavengers. Consider that a question arises before the court as to whether such an activity would fall
within the ambit of CSR. Would you look at section 135 or Schedule VII?
 In seeing or interpreting a particular schedule, can you consider it to be an enactment in itself? Yes.
– If there is some contradiction between the enactment and the schedule, the schedule will prevail.
– In cases where there is ambiguity in the schedule, you look into the original enactment, its heading, and
the intent, object and purpose of the provision.

 CIT, West Bengal v. Calcutta National Bank Ltd.

– It was held that the division of the statute into sections and schedules is generally a mere matter of
convenience and a schedule therefore may contain substantiated enactment, which may even go beyond
the scope of the section to which the schedule may appear to be connected by its heading.
– In such cases, a clear positive provision in a schedule may be held to prevail over the prima facie
indication furnished by its heading and the purpose of the schedule contained in the Act.
– However, if the language is not clear in the schedule (i.e., there is an ambiguity), the provision of the
schedule may be construed looking into the purpose indicated by the heading and the intent and purpose
section.

PROVISO
 As a general rule, a proviso is added to an enactment to qualify or create an exception to what is in the
enactment ordinarily. It is a qualification of the preceding enactment which is expressed in terms too general to
be quite accurate.
 A proviso removes special cases from the general enactment. It is subsidiary to the main section. It limits the
ambit of the section.
 A proviso is a statement of certain acts that will not fall under the ambit of a particular provision. If the proviso
and the provision are mutually exclusive, the proviso will prevail.
 An exception clause carves out an exception to a general clause. If the exception and the provision are mutually
exclusive, the provision will prevail.
 For enactments that are amended, some rights are continued by the saving clause.
 If a proviso contradicts the main enactment, or is mutually exclusive to it, the proviso will prevail.

52
 If the proviso is coextensive with the enactment, there will be no curtailment or enlargement of the right
instated in the proviso.
 In S. Sundaram Pillai v. V. R. Pattibiraman, four situations in which proviso may be used have been
highlighted. A proviso may serve the following purposes:
– Qualifying or excepting certain provisions from the main enactment;
– It may entirely change the very concept of the intendment (legislative intent) of the enactment by insisting
on certain mandatory conditions to be fulfilled in order to make the enactment workable;
– It may be so embedded in the Act itself as to become an integral part of the enactment and thus acquire the
tenor and colour of the substantive enactment itself; and
– It may be used merely to act as an options addenda to the enactment with the sole object of explaining the
real intendment of the statutory provision.

 Madhu Gopal v. Addl. District Judge.

– Section 16(5)(a) of the UP Urban Building Act, 1972, addresses a situation where there arises a vacancy in
the property ( shop basically). It pertains to review of order of release / allotment.
– Where landlord or any other person claiming to be a lawful occupant of a building or any part thereof
satisfies the District Magistrate that the review order was not made in accordance with section 16(1)(a)
and (b), the District Magistrate may again order for review.
Provided that no application under this clause shall be entertained later than seven days after the eviction
of such persons.
– The question was regarding lawful occupation at that particular time.
– Five owners. Four were occupying land. The fifth non-occupant owner, Mr. X, made a review order. A, a
tenant, applied for a particular property and got the shop.
– Proviso restricts to seven days.
– Mr. X put in his review order after 25 days. The judge maintained the application and held that A cannot
hold the property. This went against the proviso.
– X is still the landlord of the property. Is this 7 day embargo imposed only on ‘any other persons claiming
to be a lawful occupant’ or does it bind landlords as well?
– Court said that ‘or’ is a disjunctive term; there are two separate categories of people. If you put the
embargo on the landlord as well, you are curtailing his right. That cannot be done. Proviso does not apply
to landlords.

(ACT:
U.P. Urban Buildings (Regulation of Letting, Rent and
Eviction) Act 1972/U.P. Urban Buildings (Regulation of
Letting, Rent and Eviction) Rules, 1972. Section
16(5)(a)/Rule 10(9)--Review of order of release/Allotment--A
landlord even though not in actual possession can ask for
review of the order.

53
HEADNOTE:
The petitioner in the Special Leave Petition is the
tenant, Respondent No. 3 was one of the five co-owners of
the petition premises.
On January 28, 1978, one of the co-owners who had sole
possession of the shop vacated the shop and sent intimation
of the vacancy to the Rent Controller under the U.P. Urban
Buildings (Regulation of Letting and Eviction) Act, 1972.
The petitioner filed allotment application for the said shop
and he was the sole applicant.
The Rent Control Officer directed the petitioner to
appear in the allotment proceedings, called for a report
from the Inspector, found one of the co-owners to he in
possession of the shop and that he had discontinued the
business and was going to let out the shop. The 3 other co-
owners never objected to the petitioner's tenancy on the
allotment order. The allotment letter was accordingly passed
on 12th February.1978, and possession was taken up by the
petitioner thereafter.
On or about 25th February, 1978 the 3rd respondent who
was a non-occupant owner filed an application under section
16(5) of the Act i.e. after 25 days of the allotment,
for review of the order. The Rent Controller allowed the
review application and cancelled the allotment order.
The Additional District Judge having dismissed the
revision petition, the petitioner filed a writ petition in
the High Court.
The question about the maintainability of the review
application under section 16(5) of the Act at the instance
PG NO 276
PG NO 277
of a non-occupant owner having arisen the matter was
referred to a Full Bench and by a majority, the Bench came
to the conclusion that such an application was maintainable.
Dismissing the Special Leave Petition,
HELD: 1. A landlord, even though not in actual
possession at the time of the possession of the property,
can ask for review of the order of release or allotment.

54
[280G]
2. A landlord has a right to the property. The section
should not be so construed as to defeat the right to
possession of property in appropriate cases unless the
intention of the Legislature is manifest. [280F]
3. Section 16(5)(a) speaks of 'where the landlord or any
other person'. Hence, two categories of persons are
contemplated i.e. a land-lord, or any other person. [280C]
4. The requirement of the sub-section, to be in lawful
occupation of the building or any part thereof, applies only
in case of any other person claiming to be in lawful
occupation and not in case of landlord. The Section has used
the expression "or" and so the expression "or" is
disjunctive of these two categories to be treated
separately. Hence, the requirement to be in lawful
occupation, is not there is case of an application by the
landlord. [280C-D]
5. The proviso puts an embargo of 7 days in making the
application for review. It can only apply to those who were
in lawful occupation at the time of the making of the
original Order. It cannot curtail the rights of the
landlord. as such, it only affects any other person who was
in lawful occupation. [280E-G]
Niren Kumar Das v. 7he District Judge, Pilibhit & Ors.
AIR 1977 Allahabad 47, approved.)

Explanation

– S. Sundaram v V. R Pattabhiraman ( AIR 1985 SC 582)

EXTERNAL AIDS TO CONSTRUCTION

When internal aids are not adequate, court has to take recourse to External aids. External Aids may
be parliamentary material, historical background, reports of a committee or a commission, official
statement, dictionary meanings, foreign decisions, etc. [B. Prabhakar Rao v. State of AP].
Rule of Exclusion
State of Mysore v RV Bidap : extrinsic aids should not be decisive but they must be admissib;e
KP Varghese v IT Officer( AIR 1981 SC 1922) : (the speech made by the mover the bill)

In District Mining Officer v. Tata Iron & Steel Co., the Supreme Court has observed that it is a cardinal
principle of construction that external aids are brought in by widening the concept of context as including not only

55
other enacting provisions of the same statute, but its preamble, the existing state of law, other statutes in pari
materia, and the mischief which the statute was intended to remedy .

PARLIAMENTARY HISTORY, HISTORICAL FACTS AND SURROUNDING CIRCUMSTANCES

Historical setting cannot be used as an aid if the words are plain and clear. If the wordings are ambiguous, the
historical setting may be considered in order to arrive at the proper construction. Historical setting covers
parliamentary history, statement of objects and reasons, report of expert committees.
 Parliamentary history means the process by which an Act is enacted. This includes conception of an idea,
drafting of the bill, the debates made, the amendments proposed etc.
– The historical facts of the statute, i.e., the external circumstances in which it was enacted should also be
taken into note so that it can be understood that the statute in question was intended to alter the law or
leave it where it stood.
– The Supreme Court, in a number of cases, referred to debates in the Constituent Assembly for
interpretation of constitutional provisions. In, S.R. Chaudhuri v State of Punjab, it was held that it is a
settled position that debates in the Constituent Assembly may be relied upon as an aid to interpret a
constitutional provision because it is the function of the Court to find out the intention of the framers of
the Constitution,
– But as far as speeches in Parliament are concerned, a distinction is made between speeches of the mover of
the Bill and speeches of other Members. Regarding speeches made by the Members of the Parliament at
the time of consideration of a Bill, it has been held that they are not admissible as extrinsic aids to the
interpretation of the statutory provision. However, speeches made by the mover of the Bill or Minister
may be referred to for the purpose of finding out the object intended to be achieved by the Bill.
 So far as statement of objects and reasons, accompanying a legislative bill is concerned, it is permissible to
refer to it for understanding the background, the antecedent state of affairs, the surrounding circumstances in
relation to the statute, and the evil which the statute sought to remedy. But, it cannot be used to ascertain the
true meaning and effect of the substantive provision of the statute. This position was affirmed in the case of
Devadoss (dead) by L. Rs, v. Veera Makali Amman Koil Athalur.
 Reports of Commissions including Law Commission or Committees including Parliamentary Committees
preceding the introduction of a Bill can also be referred to in the Court as evidence of historical facts, or of
surrounding circumstances, or of mischief or evil intended to be remedied. Law Commission’s Reports can
also be referred to where a particular enactment or amendment is the result of recommendations of Law
Commission Report. The Supreme Court, in Rosy v. State of Kerala, considered the 41st Report of the Law
Commission of India, for interpretation of section 200 (2) of the Code of Criminal Procedure, 1898.

SOCIAL, POLITICAL AND ECONOMIC DEVELOPMENTS AND SCIENTIFIC INVENTIONS

 A Statute must be interpreted to include circumstances or situations which were unknown or did not exist at the
time of enactment of the statute. Any relevant changes in the social conditions and technology should be given
due weightage. Courts should take into account all these developments while construing statutory provisions.

56
 In S.P. Gupta v Union of India, the Court held that the interpretation of every statutory provision must keep
pace with changing concepts and values and it must, to the extent to which its language permits or rather does
not prohibit, suffer adjustments through judicial interpretation so as to accord with the requirement of the fast-
changing society which is undergoing rapid social and economic transformation.
 It is elementary that law does not operate in a vacuum. It is, therefore, intended to serve a social purpose and it
cannot be interpreted without considering the social, economic and political setting in which it is intended to
operate.
 It is here that the Judge is called upon to perform a creative function. He has to inject flesh and blood in the dry
skeleton provided by the legislature and by a process of dynamic interpretation, and invest it with a meaning
which will harmonise the law with the prevailing concepts and values and make it an effective instrument for
delivery of justice.

REFERENCE TO OTHER STATUTES

 Where two Acts have to be read together, then each part of every act has to be construed as if contained in one
composite Act. However, if there is some clear discrepancy, then the latter Act would modify the earlier.
 Where a single provision of one Act has to be read or added in another, then it has to be read in the sense in
which it was originally construed in the first Act. In this way, the whole of the first Act can be mentioned or
referred in the second Act even though only a provision of the first one was adopted.
 In a case where an old Act has been repealed, it loses its operative force. Nevertheless, such a repealed part
may still be considered for construing the unrepealed part.
 For the purpose of interpretation or construction of a statutory provision, courts can refer to or can take help of
other statutes. It is also known as statutory aids. The General Clauses Act, 1897 is an example of statutory aid.
 The application of this rule of construction has the merit of avoiding any contradiction between a series of
statutes dealing with the same subject, and it allows the use of an earlier statute to throw light on the meaning
of a phrase used in a later statute in the same context.
 Applying the same logic, when words in an earlier statute have received an authoritative exposition by a
superior court, use of same words in similar context in a later statute will give rise to a presumption that the
legislature intends that the same interpretation should be followed for construction of those words in the later
statute.

DICTIONARIES
 When a word is not defined in the statute itself, it is permissible to refer to dictionaries to find out the general
sense in which that word is understood in common parlance.
 However, in the selection of one out of the various meanings of a word, regard must always be had to the
scheme, context and legislative history.

JUDICIAL DECISIONS

57
 When judicial pronouncements are been taken as reference it should be taken into note that the decisions
referred are Indian. If they are foreign, it should be ensured that such a foreign country follows the same
system of jurisprudence as ours and that these decisions have been taken in the ground of the same law as ours.
 These foreign decisions have persuasive value only and are not binding on Indian courts. Where guidance is
available from binding Indian decisions, reference to foreign decisions is of no use.

OTHER MATERIALS
 In Ramlal v State of Rajasthan, the Supreme Court used information available on internet for the purpose of
interpretation of statutory provision.
 Courts also refer passages and materials from text books and articles and papers published in the journals.
 These external aids are very useful tools not only for the proper and correct interpretation or construction of
statutory provision, but also for understanding the object of the statute, the mischief sought to be remedied by
it, circumstances in which it was enacted and many other relevant matters.
 In the absence of the admissibility of these external aids, the court may not be in a position to do justice in a
case.

58
 INTERPRETATION OF REMEDIAL, PENAL AND FISCAL STATUTES

REMEDIAL STATUTES
 They are beneficial to weaker sections of the community.
 Through them, new favour or remedy may be conferred either to make improvement in the enforcement of a
right of any person, or for redressal of a wrong and to remove the effects of mistakes in the former law.
 Remedial statutes have to be given widest possible interpretation.
 If two reasonable constructions arise, you must choose the one which protects the particular class of people.
 Central Railway Workshop v. Vishwanath.
– In this case, it was observed that it is probably true that all legislations in a welfare state are enacted with
the object of promoting general welfare, but certain types of enactments are more responsive to some
urgent social demands and also have more immediate and visible impact on social vices by operating more
directly to achieve social reforms.
– Such legislations prohibit certain acts by declaring them invalid, and at the same time, they provide for
redressal or compensation to the person aggrieved by such acts. This means that such statutes do not
impose penalty on the offender but merely provide for redressal to the injured party. Such legislation can
be classed as remedial statutes.
– In this case the question before the court was whether time-keepers, who prepared pay sheet of the
workshop staff, maintain leave account, dispose of settlement case and maintain records for other
statistical purposes, were workers as defined in the Factories Act 1948. § 2 defined ‘as a person employed
directly or through any agency, whether for wages or not in any manufacturing process used for a
manufacturing process or any other kind of work incidental to or connected with the manufacturing
process.’ The court gave a liberal construction to the definition of worker and held that time-keepers were
workers being employed in a kind of work incidental to or connected with the manufacturing process.

 International Ore & Fertilizers (India) (P) Ltd. v. ESI Corporation. It was held that in constructing a
remedial statute, it should be given the widest operation its language would permit. The court should construe
the phraseology of the statute so as to give the most complete remedy intended and so that the purpose of the
legislation may be allowed to be achieved rather than frustrated.

 Arnit Das v. State of Bihar

– Section 2(e) of the Juvenile Justice Act, 1986, defined the term ‘delinquent juvenile’ and 2(h) defines the
term ‘juvenile’. Section 2(l), of the Juvenile Justice (Care and Protection of Children) Act, 2000, defines
‘juvenile in conflict with law’.
– The object of the Acts is to provide for the care, protection, treatment, development and rehabilitation of
neglected and delinquent juveniles.
– They are to discharge these obligations and follow the UN Minimum Rules known as Beijing Rules.

59
 – Thus, the Act being remedial in nature, its provisions should be given liberal construction to promote this
object.
 The matter of arnit Das v. State of Bihar pertained to the juvenile justice amendment. Before amendment, the
ages for boys and girls were 18 and 16 respectively. After amendment, the age was made 18 for all. The Court
said that this was done because it is a remedial statute. Now, under the UN Minimum Rules for Administration
of Juvenile Justice (also known as the Beijing Rules), the age of the accused at the time of commission of the
crime (and not the age at the time the matter was brought to the court), will be considered.
–

 SK Gulfan v. Sanat Kumar Ganguli. It was held that it was held that if a provision in a remedial statute is
capable of two interpretations, then one which furthers the policy and object of the act and which is more
beneficial to the employees should be given effect to. In case of doubt, the court may construe a provision
narrowly so as not to unduly expand the scope of the area of exception.

 State of Karnataka v. Vishwabharathi House Building Coop. Society. It was observed that in case of social
benefit oriented legislation, i.e., social welfare legislation like the Consumer Protection Act, 1986, its
provisions should be construed as broadly as possible in the consumer’s favour to obtain the purpose of the
enactment. However, it has to be remembered that in doing so, no violence to the language is permitted.

 Noor Saba Khatoon v. Mohd. Quasim. It was held that presumption against retrospective construction is
applied with less insistence in the case of welfare legislations and remedial statutes. A remedial Act is not
necessarily retrospective. The effect of a beneficial legislation is not construed to be defeated by a subsequent
legislation except through a clear provision.

 Beed District Central Co-Operative Bank Ltd. v/s State of Maharashtra & Others

We, however, are of the opinion that the said doctrine cannot be said to have any application whatsoever
in the instant case. Undoubtedly, the Payment of Gratuity Act is a beneficial statute. When two views are
possible, having regard to the purpose, the Act seeks to achieve being a social welfare legislation, it may
be construed in favour of the workman. However, it is also trite that only because a statute is beneficent
in nature, the same would not mean that it should be construed in favour of the workmen only although
they are not entitled to benefits thereof. {See Regional Director, Employees' State Insurance Corporation
Trichur vs. Ramanuja Match Industries [AIR 1985 SC 278].}

14. Applying the 'Golden Rule of Interpretation of Statute', to us it appears that the question should be
considered from the point of view of the nature of the scheme as also the fact that the parties agreed to
the terms thereof. When better terms are offered, a workman takes it as a part of the package. He may
volunteer therefor, he may not. Sub-Section (5) of Section 4 of the 1972 Act provides for a right in favour

60
 of the workman. Such a right may be exercised by the workman concerned. He need not necessarily do
it. It is the right of individual workman and not all the workmen. When the expression "terms" have
been used, ordinarily it must mean "all the terms of the contract". While interpreting even a beneficent
statute, like, Payment of Gratuity Act, we are of the opinion that either contract has to be given effect to
or the statute. The provisions of the Act envisage for one scheme. It could be segregated. Sub-Section (5)
of Section 4 of the 1972 Act does not contemplate that the workman would be at liberty to opt for better
terms of the contract, while keeping the option open in respect of a part of the statute. While reserving
his right to opt for the beneficent provisions of the statute or the agreement, he has to opt for either of
them and not the best of the terms of the statute as well as those of the contract. He cannot have both. If
such an interpretation is given, the spirit of the Act shall be lost. Even in Shin Satellite (supra), this
Court stated :

"The proper test for deciding validity or otherwise of an agreement or order is "substantial severability"
and not "textual divisibility". It is the duty of the court to sever and separate trivial or technical parts by
retaining the main or substantial part and by giving effect to the latter if it is legal, lawful and otherwise
enforceable. In such cases, the court must consider the question whether the parties could have agreed
on the valid terms of the agreement had they known that the other terms were invalid or unlawful. If the
answer to the said question is in the affirmative, the doctrine of severability.

A division bench of the Supreme Court of India, comprising of Hon’ble Mr Justice Uday Umesh Lalit
and Hon’ble Mr Justice Sanjiv Khanna, vide judgment dated 29 April 2020 in the matter of BCH
Electric Limited v Pradeep Mehra, dealt with applicability of Section 4(5) of the Payment of Gratuity Act,
1972 (Act). It held that Section 4(5) of the Act will only apply if there are alternate options for the
employee under the Act and under the terms of the contract with the employee and that the employee is
entitled to receive higher available benefit amongst the two available options.
BRIEF FACTS
 In 1979, the appellant established a gratuity fund under a trust deed for providing gratuities to the
employees of the appellant under the Gratuity Scheme (Scheme) of the appellant.
 The respondent joined the appellant in the year 2000 and retired in 2012 and the appellant paid the
respondent a sum of Rs 10 lakhs towards gratuity. However, the respondent claimed to be entitled to
a gratuity amount of Rs. 1,83,75,000.
 The respondent filed a claim under Section 7 of the Payment of Gratuity Act, 1972 (Act) contending
before the Controlling Authority that balance amount towards gratuity ought to be paid along with
an interest @ 18% per annum. The appellant, however, contended that the amount of gratuity was
capped at the prevailing upper limit and the gratuity amount was reduced so it remains within the
upper limit prescribed under the Act;
 Accordingly, the Controlling Authority under the Act allowed the claim petition of the respondent
and observed that the employees are entitled to receive higher gratuity amount in view of their
61
 respective contract without any upper limit as per the formula of the Act as the respondent is
covered under the Act  as per the Scheme.
 The appellant preferred an appeal before the Appellate Authority under the Act and thereafter
preferred a writ petition before the High Court, however both the forums upheld the findings of the
Controlling Authority.
ISSUE FOR CONSIDERATION BEFORE THE SUPREME COURT
Whether the respondent was covered under the Scheme formulated by the appellant company or under
the provisions of the Act?
MAIN ARGUMENTS BY THE PARTIES
 Appellant contended that (i) respondent was not covered under the Act and was subject to the upper
limit of Rs.10 Lacs as provided under Section 4(3) of the Act; and (ii) better terms under Section 4(5)
of the Act could only be claimed under specific circumstances. The appellant placed reliance on the
law laid down by the Supreme Court in Beed District Central Cooperative Bank Limited v. State of
Maharashtra and Union of India and Others v. C.G. Ajay Baby & Anr. which held that that a
combination of statutory provisions and contractual schemes cannot be followed while computing
gratuity.
 Respondent contented that (i) Section 4(5) of the Act has an overriding effect over Section 4 of the
Act and the same would override Section 3 of the Act; and (ii) that the appellant’s Scheme did not
prescribe any ceiling limit thereby falling under Section 4(5) of the Act.
JUDGMENT 
The Supreme Court closely observed the historical background of the amendments to the provisions of
the Act and observed that when the respondent resigned from the appellant company, the ceiling limit
under Section 4(3) was fixed at “ten lakh rupees” and there was no upper limit for an employee to be
covered under Section 2 (e) of the Act.
The Supreme Court held that Section 4(5) of the Act stipulates that if better terms are available to an
employee under any contract or scheme provided by the employer, nothing in Section 4 shall affect the
right of an employee to receive such better terms. The Supreme Court also delved into the clauses of the
Scheme which stated that in case the employee is covered under the Act, the Scheme shall not be
applicable for calculating the gratuity amount. Therefore, it was observed that as per the Scheme only
those employees who are not covered under the Act shall accrue the benefit of the Scheme. In view of the
aforesaid, it was held that Section 4(5) will be applicable only if there are two alternatives available to
the employee, however no alternative is available to the respondent.  
The Supreme Court distinguished its own decision in Beed District Cooperative Bank Ltd (Supra) stating
that the position therein was where an employee had two available alternatives, however under the
Scheme of the appellant company, an employee could avail the same only if it did not fall under the
purview of the Act.  
COMMENT
By way of the present judgment the Supreme Court has re-iterated the principle that employee benefit
should hold the utmost priority for an organisation This decision also clarifies that  even though the
62
 employee can accrue the benefit of the best of the available option, an employee cannot go against its
arrangement with the employer.
Thus, the Supreme Court has re-affirmed, that the essence of the Act is the interest of general public
together with major focus on economic justice to the workmen. 

PENAL STATUTES
 Anything that defines a crime, and gives punishment with respect to the same, is a penal statute.
 The Act has to be very immaculately drafted.
 Judges have to apply the legal text only as is written in the enactment. Once the court has clear meaning of the
text, no further investigation is required. Even then if two reasonable constructions arise, the one that is
favourable to the accused must be chosen.
 Where by strained construction of a penal statute, it is made to include an act which is not otherwise
punishable, it is known as ‘constructive crime’.
 The rule that a statute enacting an offence or imposing a penalty is strictly construed is now only of limited
application. The rule was originally evolved to mitigate the rigour of monstrous sentences for trivial offences.
Although that need has now vanished, the difference in approach continues to persist.
 In Sham Sunder v. State of Haryana, it was held that a clear language is needed to create a crime, and a
statute, enacting an offence of imposing penalty, is strictly construed.
 In Chief Inspector of Mines v. Karam Chand Thapar, it was held that a statute providing for penal
prosecution has to be construed strictly. However, this rule is not of universal application which must
necessarily be observed in every case.
 In State of W.B. v. Swapan Kumar Guha, it was observed that where an ambiguity exists and it has not been
possible for the legislature to express itself clearly, the court exhibits a preference for the liberty of the subject
and resolves the doubt in favour of the subject (accused).
 In W.H. King v. Republic of India, it was observed that a statute which creates an offence and imposes a
penalty of fine and imprisonment must be construed strictly in favour of the subject. The principle, that no
person can be put in peril of his life and liberty on an ambiguity, is well established.
 To put it in other words, as held in M.V. Joshi v. M.U. Shimpi, the rule of strict construction requires that the
language of a statute should be so construed that no case shall be held to fall within it which does not come
within the reasonable interpretation of the statute.
 As observed in Lalita Jalan v. Bombay Gas Co. Ltd., penal provisions should be construed in a manner
which will suppress the mischief and advance the object which the legislature had in view.
 It was also held in Collector of Customs v. East Punjab Traders, that the provisions of a penal statute cannot
be presumed to have retrospective operation.
 When there are two possible constructions, the court must lean towards that construction which exempts the
subject from penalty, rather than the one which imposes penalty. The Court held, in Tolaram Relumal v. State

63
 of Bombay, that the court cannot stretch the meaning of an expression used by the legislature in order to carry
out the intention of the legislature.

 It was held in Ashok Kumar v. State of Haryana, that even though the settled rule is that penal statutes must
be construed strictly, certain statutes must be understood in their plain language and with reference to their
meaning in common parlance.
– These are the provisions relating to human behaviour and, therefore, cannot be given such a narrower
meaning, which would defeat the very purpose of the provisions of the act.
– Of course, these are penal provisions and must receive strict construction. But, even the rule of strict
construction requires that the provisions have to be read in conjunction with other relevant provisions and
scheme of the Act.
– Further, the interpretation given should be one which would avoid absurd results on the one hand and
would further the object and cause of the law, so enacted, on the other.

 In Dineshchandra Gandhi v. State of Gujrat, it was held that:

– Where offences under the Act are really acts prohibited by the police powers of the state in the interest of
public health and well-being, and prohibition is backed by the sanction of a penalty, the offences are
strictly statutory offences and intention or mental state is irrelevant.
– Such acts prescribe a strict liability. Thus, in such acts, establishing mens rea is not needed.

 The rule of construction in penal statutes does not prevent the court from 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 the statute.
– In R. v. Ireland, psychiatric injury caused by silent telephone calls was held to amount to assault and
bodily harm under the Offences against Person Act, 1861 in the light of the current scientific appreciation
of the link between the body and psychiatric injury.

– In R v Fellows, data stored in computer disc (a technology not anticipated in 1978), was held to amount to
‘indecent photograph’ within the meaning of Section 1 of the Protection of Children Act ,1978 (even
before its amendment in 1994), which penalises taking or distribution of indecent photograph of children
under the age of 16.

 Virtual Soft Systems Ltd. v. Commissioner of Income Tax (2007).

– In this case (prior to amendments by the Finance Act, 2002), the questions that arose before the Supreme
Court were:
 What was meant by the words ‘in addition to any tax payable’ in the charging § 271(c)(iii)?
 What was meant by the term ‘total income’ in Explanation 4(a) therein?

64
 – Allowing the appeals, it was held by the Court that the statute creating the penalty is the first and the last
consideration and the penal provision must be construed within the term and language of the particular
statute.
– Reference was made to the case of Bijaya Kumar Agarwala v. State of Orissa (which further cites
Tolaram Relumal v. State of Bombay), that strict construction is the general rule of penal statutes. 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 penalty. The
court must not stretch the meaning of an expression used by the Legislature in order to carry out the
intention of the Legislature.
– It was held that § 271 of the Act is a penal provision and there are well-established principles for
interpretation of such a penal provision. Such a provision has to be construed strictly and narrowly and not
widely; with the object of advancing the object and intention of the legislature.
– Therefore, when a law visits a person with serious penal consequences, extra care must be taken to ensure
that those whom the legislature did not intend to be covered by the express language of the statute are not
roped in by stretching the language of the law.

 Aneeta Hada v. Godfather Travels and Tours Ltd. (2012)

– The appellant, Aneeta Hada, an authorised signatory of International Travels Limited, issued a cheque
dated 17th January, 2011 for a sum of Rs.5,10,000/- in favour of the respondent, namely, M/s. Godfather
Travels & Tours Private Limited, which was dishonoured, as a consequence of which the said respondent
initiated criminal action by filing a complaint before the concerned Judicial Magistrate under Section
138 of the NI Act.
– In the complaint petition, the company was not arrayed as an accused. However, the Magistrate took
cognizance of the offence against the accused appellant.
– Section 141 of the Negotiable Instruments Act, 1881 deals with offences by companies. Under the section,
it is provided that if the person committing an offence under section 138 is a company, every person who,
at the time the offence was committed, was in charge of, and was responsible to the company for the
conduct of the business of the company, as well as the company, shall be deemed to be guilty of the
offence and shall be liable to be proceeded against and punished accordingly. (Essentially, this is a
statutory provision allowing for all responsible individuals, in addition to the company itself, to be
proceeded against).
– The Court observed that the word ‘deemed’ used in Section 141 of the Act applies to the company and the
persons responsible for the acts of the company. It crystallizes the corporate criminal liability and
vicarious liability of a person who is in charge of the company.
– Reference was made to SMS Pharmaceuticals Ltd. v. Neeta Bhalla, wherein it was opined that the
criminal liability on account of dishonour of cheque primarily falls on the drawee company and is
extended to the officers of the company, and as there was a specific provision extending the liability to the
officers, the conditions incorporated in Section 141 were to be satisfied.

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  The normal rule in the cases involving criminal liability is against vicarious liability, i.e., , no one is
to be held criminally liable for an act of another. This normal rule is, however, subject to exception
on account of specific provision being made in the statutes extending liability to others .  Section 141
is one such exception. 
 Section 141 contains conditions which have to be satisfied before the liability can be extended to
officers of a company. Since the provision creates criminal liability, the conditions have to be strictly
complied with.
 The conditions are intended to ensure that a person who is sought to be made vicariously liable for an
offence of which the principal accused is the company, had a role to play in relation to the
incriminating act and further that such a person should know what is attributed to him to make him
liable.
– The Court cited Francis Bennion in Statutory Interpretation, where it is stated that a principle of statutory
interpretation embodies the policy of the law, which is in turn based on public policy. The court presumes,
unless the contrary intention appears, that the legislator intended to conform to this legal policy. A
principle of statutory interpretation can therefore be described as a principle of legal policy formulated as a
guide to legislative intention.
– It also cited Maxwell in The Interpretation of Statutes, wherein it is stated that the strict construction of
penal statutes seems to manifest itself in four ways:
 In the requirement of express language for the creation of an offence;
 In interpreting strictly, words setting out the elements of an offence;
 In requiring the fulfilment to the letter of statutory conditions precedent to the infliction of punishment;
and
 In insisting on the strict observance of technical provisions concerning criminal procedure and
jurisdiction.
– The Court observed that there has to be strict observance of the provisions, with regard being had to the
legislative intendment because it deals with penal provisions and a penalty is not to be imposed affecting
the rights of persons whether juristic entities or individuals, unless they are arrayed as accused.
– The power of punishment is vested in the legislature and that is absolute in Section 141 of the Act, which
clearly speaks of commission of offence by the company.
– The counsel for the respondents vehemently urged that the use of the term ‘as well as the company’ in the
Section is of immense significance and, in its tentacle, it brings in the company as well as the director
and/or other officers who are responsible for the acts of the company and, therefore, a prosecution against
the directors or other officers is tenable even if the company is not arraigned as an accused.
– The Court observed that the words ‘as well as the company’ have to be understood in the context. The
entire statute must be first read as a whole, then section by section, clause by clause, phrase by phrase and
word by word.
– Applying the doctrine of strict construction, the Court held that the commission of an offence by the
company is an express condition precedent to attract the vicarious liability of others. Thus, the words ‘as
well as the company’ appearing in the Section make it absolutely unmistakably clear that the persons
66
 mentioned in the Section could be vicariously liable for the offence only when the company can be
proceeded against.
– Applying the principle of strict interpretation of penal statutes, the Supreme Court held that only the drawer
of the cheque could be made liable for penal action under Section 138 of NI Act, and not another person
who had merely negotiated the transaction out of which debt had arisen, and was only a joint account
holder along with the drawer, but had not signed the cheque.
– The Court was of the view that Section 141 was not attracted, and held that a prosecution thereunder
cannot be maintained only against an officer of the company, without arranging the company as an
accused, since officers of a company can only be held vicariously liable for the offences committed by a
company.

 Some of the propositions important in relation to strict construction of penal statutes are as follows:
– If the scope of prohibitory words covers only some class of persons or some well-defined activity, their
scope cannot be extended to cover more on consideration of policy or object if the statute.
– Prohibitory words can be widely construed only if indicated in the statute.
– On the other hand, if after full consideration no indication is found, the benefit of construction will be
given to the subject.
– If prohibitory words, in their own signification, bear wider meaning, they fit in with the object or
policy of the statute.

DIFFERENCES BETWEEN REMEDIAL AND PENAL STATUTES

REMEDIAL STATUTES PENAL STATUTES

They deal with the wrongs against the State.

They deal with the wrongs against an individual.

They deal with those matters which affect the

They deal with those matters which affect the
individual only.
whole community.

They provide a remedy for infringement of private

They provide punishment for public wrong.
civil rights of an individual.

They deal with such wrongful acts for which remedy They deal with such wrongful acts, the commission of
is civil action. which attracts punitive (penal) action.

Remedy for wrongful acts is provided in the form of Penalty such as imprisonment, fine, forfeiture etc.is
damages or compensation to the aggrieved party, but imposed on the offender.
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 the wrongdoer is not held liable for any penalty.

Duty is fixed by the State.

Duty is fixed by party.

The state takes action and state is a

The injured party takes action. prosecuting agency.

Negligence along with criminal intention must be

Proof of negligence is sufficient. proved to constitute an offence or crime.

They receive liberal or beneficent construction.

They are strictly construed.

They are also known as welfare, beneficent or social

justice-oriented legislation. They are simply known as penal statutes.

They are enforced by law when suit is filed by the

In case violation of penal law, the state initiates the
aggrieved person in civil court or tribunal.
action against the criminal courts.

The doubt is resolved in favour of the class of person

for whose benefit the statute is enacted. The doubt is resolved in favour of the alleged offender.

FISCAL STATUTES
 Taxing statutes are to be strictly construed.
 Lord Simmonds stated that the subject is not to be taxed without clear words for that purpose, and every Act of
Parliament must be read according to the natural construction of its words.
 The Judiciary cannot, by implication, ask a person to bear a tax.
 In CIT v. Calcutta Knitwears, it was held that Courts, while interpreting provisions of a fiscal statute should
neither add nor subtract a word from the provisions.
 In Gurusahai v. CIT, it was held that while fiscal statutes are to be strictly construed, provisions as to ‘relief’
and ‘exemption’ must be construed liberally since they are remedial provisions. This exemplifies the
distinction between charging provisions (strictly construed) and machinery provisions (liberally construed).
 Every taxing statute must contain three elements – subject of tax, person to be taxed, and rate of tax.
 It must be a charging section, i.e., penalty must be provided. The section that charges the tax must have clear
words. In Calcutta Jute Manufacturing Co. v. Commercial Tax Officer, the Supreme Court held that in a
case of interpreting a taxing statute, one has to look into what is clearly stated. There is no room for searching

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 intentions, presumptions, or equity. There exists in law a concept of ‘equitable construction’, but it does not
apply in case of taxation statutes.
 Taxation statutes have to be given strict construction and the right to tax should be clearly established.
Equitable construction should not be taken into account. [these two points were given in Saraswati Sugar
Mills v. Haryana State Board]. Intention to impose or increase tax or duty must be clear and in unambiguous
language (example of CSR). Further, if two outcomes may be there, the interpretation favourable to the
assessee must be taken.
 The cardinal principle of tax laws is that the law in force in the assessment year unless otherwise provided
expressly or by necessary implication (procedural provisions).
 No retrospective effect to a fiscal statute is possible, unless the language of the statute is very clear about the
same. Case talking about necessary implication is Reliance Jute Industries Ltd. v. Commercial Tax Officer.
 No presumption as to tax can be taken.
 A fiscal statute has to be read as a whole.
 A person is not liable to tax on the spirit of the law, or logic, or reason.
 The tax authorities must consider the legal aspect of a particular transaction for levy of tax. This is called
‘substance of the matter’.

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 GENERAL PRESUMPTIONS

Note: The doctrine of necessary implication states that what is implied in a statute is as much part of the statute, as
which is expressed. Every statute is understood by implication to contain all such provisions as may be necessary to
give effect to the provision’s object and purpose.

THE WORDS IN A STATUTE ARE USED PRECISELY AND NOT LOOSELY

 This rule follows the maxim ‘verbis legis non est recedendum’, which means that you must not vary the words
of a statute. The courts should not make any interpretation contrary to the express words of an enactment.
 If something has been said by the legislature, there is an implication that it has to be necessarily applied.
 Mayor, Councillors & Burgesses v. Electrical Power Board.
– In this case, the phrase ‘adjoining territory’ was being interpreted.
– The respondents commenced an action for the determination of the question of validity of certain
agreements to supply electricity to certain adjoining territories.
– It was decided that the primary and exact meaning of the term ‘adjoining’ is ‘conterminous’, i.e., having a
common boundary attached. Only those states that shared a common boundary with the state in question
would fall within the definition of ‘adjoining territory’.

MENS REA IS GENERALLY REQUIRED FOR A CRIMINAL ACT

 A statute creating an offence may define the particular state of mind, which is to be an element of the offence,
either expressly or by necessary implication. It may be silent also.
 In such cases, unless mens rea as a constituent part of a crime is ruled out by necessary implication, a court
should be jealous to guard the liberty of the subject and should not find a man guilty unless he is proved to
have had a guilty mind.
 Srinivas Mall v. Emperor.
– In this case, the appellant and his employees were charged with having sold a commodity at a price
exceeding the maximum price fixed under the Defence of India Act, 1939 and the rules made thereunder.
The employer was not aware of the conduct of his employees.
– The High Court convicted the employer due to the application of the concept of vicarious liability.
Further, it noted that the crime was based on an absolute prohibition. (sometimes in statutory offences, the
mens rea requirement is excluded but this is not the case with common law, absolute prohibition is
generally for minor punishment with not much fine or imprisonment).
– The High Court took the view that even if the first appellant (i.e., the employer) had not been proved to
have known of the acts of the second appellant (i.e., the employee), he would still be liable on the ground
that where there is an absolute prohibition, no question of mens rea arises and the master is criminally
liable for the acts of his servant.

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 – The Privy Council saw no ground for saying that offences against those of the Defence of India Rules here
in question were within the limited and exceptional class of offences which can be held to be committed
without a guilty mind. Offences generally within this class were of minor character and it would be a
surprising result of this delegated legislation if a person who was morally innocent of the blame, could be
held vicariously liable for a servant’s crime, and so punishable with imprisonment of three years and
more.
– The PC quoted a previous judgement which stated that: “It is in my opinion, of utmost importance for the
protection of the liberty of the subject that the court should always bear in mind that unless the statute
either clearly or by necessary implication, rules out mens rea as a constituent part of a crime, a defendant
should not be found guilty of an offence against the criminal law unless he has got a guilty mind.
– The Privy Council said that there is no exclusion by necessary implication and so the employer cannot be
charged. The punishment of the offence committed is 3 years, i.e., it is a serious offence. Punishment for
such offences, cannot be excluded by necessary implication; it cannot fall under that exception. A person
who has no mens rea cannot be made liable for an offence – doing so would not have been the intention of
the legislature.

THE GOVERNMENT IS AFFECTED BY THE STATUTE

 Under English law, unless the Crown was explicitly named in the provision, it could not be made party to the
case.
 In India, the case is different. Unless the State is explicitly excluded, we presume that the state is party to the
dispute. This principle was reiterated in Union of India v. Jubbhi.

THE LEGISLATURE KNOWS THE EXISTING LAW AND DOES NOT INTEND TO ALTER IT
EXCEPT BY EXPRESS ENACTMENT
 You cannot change any law just by judicial interpretation.
 The legislature has to give an express enactment, only then is the change in law valid.
 If you are construing the post-amendment provision, the judiciary will have to look into the pre-amendment
scenario as well. This was discussed in the case of Abdul Rahim v. Abu Mohd.

THE LEGISLATURE DOES NOT COMMIT MISTAKES OR MAKE OMMISSIONS

 If the precise words used are plain and unambiguous, we are bound to construe them in their ordinary sense.
 Words may be modified or varied when their import is doubtful or obscure.
 If words taken grammatically have a certain and unequivocal meaning, if they constitute a perfectly complete
expression susceptible only of that one meaning, then however absurd and pernicious the consequences, that
meaning is to be followed.

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 CASUS OMISSUS

 The literal translation of ‘casus omissus’ is ‘cases of omission’.

 Omission in a statute cannot be supplied by construction. You cannot legislate, unless the legislature provide
for it. It is linked with the concept of judicial overreach. Even if there is a defect or omission in the words used
by the Legislature, the court cannot correct the deficiencies, especially when a literal reading produces an
intelligible result.
 A matter which should have been, but has not been provided for in a statute cannot be supplied by courts, as to
do so will be legislation and not construction.
 However, where the lacuna in the language is of such nature that unless the omitted word is supplied, the
statute cannot operate, or the true intention of the legislature cannot be established, the courts have inserted the
missing word in the language to ensure that the law is not turned to nullity. This relates to circumstances where
a court can supply a clearly unintended omission by the legislature in drafting a provision. This issue arises
quite frequently and in varying circumstances.
 Lord Denning observed that “where a defect appears, a judge cannot simply fold hands and blame the
draftsmen. Rather, he must set to work on the constructive task of finding the intention of the Parliament and
then he must supplement the written words so as to give force and life to the intention of the legislature.”

 Basavanatappa v. Gangadhar Narayan Dharwadkar.

– This case relates to the construction of Order XXI Rule 89 of the Code of Civil Procedure after the
amendment of Article 127 of the Limitation Act. Rule 89 provides that if any person, claiming an interest
in the property sold in execution of a decree, applies to have the execution sale set aside and deposits
within thirty days from the date of the sale, 5% of the purchase money for payment to the purchaser and
the amount payable to the decree-holder for recovery of which the sale was held, the court shall make an
order setting aside the sale.
– The period of limitation for applying under Rule 89 for setting aside the sale was 30 days under Article
127 of the Limitation Act. After its amendment in 1976, the period was enlarged to 60 days. However, the
Parliament omitted to make corresponding amendment in Rule 89 to enlarge the period for making deposit
to 60 days.
– The object and reason of the amendment bill showed that the period was enlarged since 30 days was
considered to be too short for making the deposit, often leading to hardship.
– The Court held that in addition to the period of limitation for making application being extended to 60
days, the period for making the deposit under Rule 89 was also impliedly extended from 30 days to 60
days.
– The subsequent decision in PK Unni v. Nirmala Industries overruled this decision.
– Later, a 5-judge Bench in Dadi Jagannadham v. Jammulu Ramulu overruled Nirmala Industries (i.e.,
upheld the position in Basavanatappa). Although accepting that the court cannot make up deficiencies left
by the legislature, it observed that the court must try to harmonise the conflicting provisions.
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RULES TO BE KEPT IN MIND BY JUDGES WHILE ADDING WORDS TO A STATUTE
6. The legislature is always right, so, there is no presumption that a casus omissus exists. This is to avoid the
negative effects of judicial activism. In the garb of interpretation, judges must not legislate by adding / altering
terms.
7. The intention of the words is sufficiently portrayed through whatever the legislature has legislated.
8. It is presumed that the legislature does not waste any words and the courts should try to achieve the intention
with the given words.
9. However, where the alternative lies between either supplying by implication, words that appear to have been
accidentally omitted, or adopting a construction which deprives certain existing words of all meaning, it is
permissible to supply words [Surjit Singh Kalra v. Union of India].
10. Wherever the court is supplying any words, it should be possible to state with certainty that these, or similar
words, would have been inserted by the draftsmen and approved by the Parliament, had their attention been
drawn to the omission before the Bill was passed [Union of India v. Hansoli Devi].

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Definition interpretation
Restrictive ( means)
Eg. Sec 149(6) An independent director in relation to a company, means a director other than a managing director
or a whole-time director or a nominee director,—
[(a) who, in the opinion of the Board, is a person of integrity and possesses relevant expertise and experience;]
4

(b) (i) who is or was not a promoter of the company or its holding, subsidiary or associate company;

Extensive (includes)
Schedule VII
(See sections 135) CA,2013
Activities which may be included by companies in their Corporate Social
Responsibility Policies
Activities relating to:—
(i) eradicating extreme hunger and poverty;
(ii) promotion of education;
(iii) promoting gender equality and empowering women;
(iv) reducing child mortlity and improving maternal health;
(v) combating human immunodeficiency virus, acquired immune deficiency
syndrome, malaria and other diseases;
(vi) ensuring environmental sustainability;
(vii) employment enhancing vocational skills;
(viii) social business projects;
(ix) contribution to the Prime Minister's National Relief Fund or any other
fund set up by the Central Government or the State Governments for
socio-economic development and relief and funds for the welfare of the Scheduled
Castes, the Scheduled Tribes, other backward classes, minorities and women; and
(x) such other matters as may be prescribed.

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