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CASE NO.:

Appeal (civil) 5327 of 2002

PETITIONER:

M.P. HIGH COURT BAR ASSOCIATION

RESPONDENT:

UNION OF INDIA AND OTHERS

DATE OF JUDGMENT: 17/09/2004

BENCH:

CJI R.C. LAHOTI & C.K. THAKKER

JUDGMENT:

J U D G M E N T

WITH

CIVIL APPEAL No. 5328 OF 2002, CIVIL APPEAL

NO. OF 2004 @ S.L.P.(C) No. 22648 of 2002,

CIVIL APPEAL NOs. OF 2004 @ S.L.P.(C)

Nos. 23615-23616 of 2002, CIVIL APPEAL Nos.

8292-8295 OF 2002, WRIT PETITION (C) Nos. 369

OF 2003 AND 374 OF 2003

Thakker, J.

Leave granted in Special Leave Petition (Civil) Nos. 22648 of

2002 and 23615-23616 of 2002.

In the present group of matters, common questions of fact and

law have been raised by the parties. It is, therefore, appropriate to

decide all the matters by a common judgment.

To appreciate the controversy raised and questions agitated in

these matters, few relevant facts in the first matter, i.e., Civil Appeal

No. 5327 of 2002 may be stated. The appeal arises out of a judgment

and order dated May 14, 2002 passed by the High Court of Madhya

Pradesh at Jabalpur in Writ Petition No. 3531 of 2001.

The said petition was filed by the Madhya Pradesh High Court

Bar Association and another against the Union of India, State of

Madhya Pradesh, State of Chhattisgarh and the Chief Ministers of

both the States. The case of the petitioners is that the petitioner No. 1

is an Association of Advocates practising at the High Court of

Madhya Pradesh, Madhya Pradesh State Administrative Tribunal at

Jabalpur as also Central Administrative Tribunal (Jabalpur Bench).

The Association was constituted to look after and protect the interests

of its members. One of the prime duties of the Association, asserted

the petitioners, is to ensure that legal system in the State is not

attacked by an outside agency. Its aim is also to advance the cause of

justice by speedy trial. It has, therefore, locus standi to file a petition.

Petitioner No.2 is the President of the Madhya Pradesh Bar

Association. He is a practising lawyer at the High Court as well as at

two Tribunals. He is a citizen of India.

The petitioners have stated that Parliament amended the

Constitution by the Constitution (42nd Amendment) Act, 1976 by

which several changes had been made. As a consequence thereof,

Article 323A came to be inserted in the Constitution with effect from

January 3, 1977. The said Article provided for constitution and

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establishment of Administrative Tribunals. Those Tribunals were

empowered to adjudicate and decide disputes and complaints relating

to recruitment and conditions of service of persons appointed to public

services and posts in connection with the affairs of the Union or of

any State or of any local or other authority within the territory of India

or under the control of the Government of India or of any corporation

owned or controlled by the Government. It also declared that the

provisions of the said Article would have effect notwithstanding

anything in any other provision of the Constitution or in any other law

for the time being in force. The Article further provided for exclusion

of jurisdiction of all courts, "except the jurisdiction of the Supreme

Court under Article 136", with respect to disputes or complaints to be

dealt with by such tribunals. Article 323A, however, is not self-

executory inasmuch as it did not take away the jurisdiction of courts.

It merely enabled Parliament or appropriate legislature to make laws,

to set up such tribunals and to exclude jurisdiction of all courts except

the Supreme Court.

In exercise of the power conferred by Article 323A of the

Constitution, Parliament enacted an Act, called the Administrative

Tribunals Act, 1985 (hereinafter referred to as "the Act"). In the

Statement of Objects and Reasons, it was stated that with a view to

give effect to the constitutional provision by providing for the

establishment of an Administrative Tribunal, the Act has been

enacted. The Preamble of the Act also recites that with a view to

provide for the adjudication or trials by Administrative Tribunals of

disputes and complaints with respect to recruitment and conditions of

service of persons appointed to public services and posts in

connection with the affairs of the Union or of any State or of any local

or other authority, the Act has been enacted. Whereas Section 4

provides for establishment of Administrative Tribunals, Section 5

deals with composition of Tribunals and Benches. Provisions relating

to qualifications for appointment as Chairman, Vice-Chairman and

other Members as also their terms of office, salaries and allowances,

etc. have been made in Sections 6 to 13. Sections 14 to 18 deal with

jurisdiction, power and authority of Tribunals. Sections 19 to 27 lay

down the procedure to be followed by such Tribunals. Section 28

excludes jurisdiction of all courts except the Supreme Court.

Sub-section (2) of Section 4 of the Act enabled the Central

Government, on receipt of a request from the State Government to

establish by a notification an Administrative Tribunal for the State to

exercise the jurisdiction, powers and authority conferred on the

Administrative Tribunal for the State. According to the petitioners, a

request was made by the State of Madhya Pradesh for the

establishment of an Administrative Tribunal for the State. The

Central Government, in exercise of power under sub-section (2) of

Section 4 of the Act, therefore, issued a notification on June 29, 1988

for establishment of a Tribunal known as the Madhya Pradesh

Administrative Tribunal with effect from August 2, 1988. The

petitioner stated that in pursuance of the notification, the State

Administrative Tribunal had been established. It was having a

Principal seat at Jabalpur and four Benches at Gwalior, Indore, Bhopal

and Raipur.

The petitioners further stated that Parliament enacted an Act

called the Madhya Pradesh Re-organisation Act, 2000, (Act 28 of

2000) (hereinafter referred to as "the Act of 2000"). The said Act has

been enacted with a view "to provide for the re-organisation of the

existing State of Madhya Pradesh and for matters connected

therewith". Part II deals with re-organisation of the State of Madhya

Pradesh into two States to be known as the State of Madhya Pradesh

and the State of Chhattisgarh and their territorial divisions. Part III

provides for representation in the Legislatures. Part IV relates to

administration of justice. Part VIII deals with services. It provides

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for All-India services, services in Madhya Pradesh and Chhattisgarh

and other services as also power of the Central Government to issue

directions. Section 74 of the Act touches jurisdiction of Commissions,

Authorities, Tribunals, Universities, Boards and other statutory

bodies, constitutional validity and vires whereof has been challenged.

It is, therefore, appropriate to re-produce the said section in extenso.

"74. Jurisdiction of the Commissions,

Authorities and Tribunals.\027(1) Notwithstanding

anything contained in any law for the time being in force,

every Commission, Authority, Tribunal, University,

Board or any other body constituted under a Central Act,

State Act or Provincial Act and having jurisdiction over

the existing State of Madhya Pradesh shall on and from

the appointed day continue to function in the successor

State of Madhya Pradesh and also exercise jurisdiction as

existed before the appointed day over the State of

Chhattisgarh for a maximum period of two years from

the appointed day or till such period as is decided by

mutual agreement between the successor States:

(i) to continue such body as a joint body for the

successor State or

(ii) to abolish it, on the expiry of that period, for either

of the successor States; or

(iii) to constitute a separate Commission, Authority,

Tribunal, University, Board or any other body, as

the case may be, for the State of Chhattisgarh.

(2) No suit or other legal proceeding shall be

instituted, in case such body is abolished under clause (ii)

of sub-section (1), by any employee of such body against

the termination of his appointment or for the enforcement

of any service conditions or for securing absorption in

alternative public employment against the Central

Government or any of the successor States.

(3) Notwithstanding anything contained in any law for

the time being in force or in any judgment, decree or

order of any court or Tribunal or contract or agreement,

any Chairman or member of any body abolished under

clause (ii) of sub-section (1) shall not be entitled to any

compensation for the unexpired period of his tenure.

(4) Notwithstanding anything contained in this section or

any law for the time being in force, the Central

Government shall, in accordance with any mutual

agreement between the successor States or if there is no

such agreement, after consultation with the Government

of the successor States, issue directions for the resolution

of any matter relating to any body referred to in sub-

section (1) and falling within the jurisdiction of any of

the successor State within any period referred to in sub-

section (1).

Section 85 declares that the provisions of the Act shall have

overriding effect "notwithstanding anything inconsistent therewith

contained in any other law."

Bare reading of sub-section (1) of Section 74 makes it clear that

it declares that all Commissions, Authorities, Tribunals, Universities,

Boards or other bodies constituted under an Act of Parliament will

continue to function in the State of Madhya Pradesh as also in the

State of Chhattisgarh. It, however, states that they will continue to

function for a maximum period of two years or "till such period as is

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decided by mutual agreement between the successor States". Sub-

sections (2) and (3) enumerate circumstances pursuant to the abolition

of such Tribunal. Sub-section (4) allows the Central Government to

issue directions.

The petitioners stated in the petition that in purported exercise

of the powers under sub-section (1) of Section 74 of the Act, a

decision was taken by the State of Madhya Pradesh as well as the

State of Chhattisgarh to abolish State Administrative Tribunal. A

notification was issued on 25th July, 2001 by the State of Madhya

Pradesh by which the Madhya Pradesh State Administrative Tribunal

had been abolished. By a circular of even date issued by the State, it

had been ordered that existing Chairman, Vice-Chairman and

Members of the Tribunal would cease to function with immediate

effect irrespective of unexpired period of their tenure, if any. By an

order of even date, the State Government terminated the services of all

officers and employees other than those on deputation with immediate

effect as their services were "no longer required".

Being aggrieved by the said actions, the petitioner-Association

approached the High Court of Madhya Pradesh by invoking Articles

226 and 227 of the Constitution. A writ of Mandamus was sought to

declare Section 74 of the Act of 2000 unconstitutional and ultra vires.

In the alternative, a prayer was made to issue a writ of Mandamus to

hold that Section 74 would not apply to State Administrative Tribunal.

A further prayer was made to quash and set aside a notification, a

circular and an order dated July 25, 2001 by which the State

Administrative Tribunal was sought to be abolished and consequential

actions were taken.

Similar petitions were filed being W.P. No.3529 of 2001 by

A.K. Shrivastava, a Member of the Administrative Tribunal, W.P.

No.3525 of 2001 by Sanjay Kumar Misra, W.P. No. 3551 of 2001 by

Kamal Joshi, W.P. No.3554 of 2001 by Nemi Chand, all employees of

the State Administrative Tribunal, W.P. No. 3597 of 2001 and W.P.

No.4129 of 2001 by Madhya Pradesh Class III Government

Employees Association.

Notices were issued to the State of Madhya Pradesh and other

respondents. The respondents appeared. An affidavit-in-reply was

filed by the State of Madhya Pradesh supporting the actions taken by

the Government. It was asserted in the counter that establishment of

State Administrative Tribunal was not obligatory. The State

Government was not bound to constitute the Tribunal. It was,

therefore, open to the State Government to create, continue or abolish

such Tribunal. Since the power exclusively vested in the State

Government to create, continue or abolish the Tribunal, the Central

Government had no voice in the matter. It was also stated that the

Council of Ministers of the State of Madhya Pradesh took a decision

on November 21, 1985 for the establishment of State Administrative

Tribunal in the State of Madhya Pradesh. A request was, therefore,

made to the Central Government to constitute State Administrative

Tribunal and, accordingly, a notification was issued on June 29, 1988

and the Tribunal was constituted on August 2, 1988. Initially there

was only a Principal seat at Jabalpur. Later on, three Benches were

established at Gwalior, Indore and Bhopal. In 1997, even the fourth

Bench was established at Raipur. The deponent stated that over and

above State of Madhya Pradesh, seven other States had established

State Administrative Tribunals. In the affidavit in reply, it was the

case of the respondent-State that despite very laudable object behind

the establishment of Administrative Tribunals, the performance of the

Tribunals always remained "far from satisfactory and the Tribunals

failed to achieve the objects and goals for which they were

established". Reference was made to the report of the Arrears

Committee (1989-90), known as "Malimath Committee" which

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elaborately dealt with the functioning of Tribunals in the country.

Citing extensively the working of the Tribunals in the report of

Malimath Committee, it was asserted by the State that the State

Administrative Tribunal failed to fulfill the object for which it was

established. Moreover, after the landmark decision of the Supreme

Court in L. Chandra Kumar v. Union of India (1997) 3 SCC 261 :

AIR 1997 SC 1125, wherein it has been held by the Apex Court that

the decisions rendered by the Tribunals constituted under Articles

323A and 323B of the Constitution of India would be subject to the

writ/supervisory jurisdiction of the High Courts under Article 226/227

of the Constitution within whose territorial jurisdiction the particular

Tribunal is functioning, there was virtually no need to continue such

Tribunal. It was the case of the respondent-State that in the light of

declaration of law in L. Chandra Kumar, Administrative tribunals

became "intermediate/additional adjudicatory stratum", "leading to

substantial increase in number of pending cases at the level of High

Court". Several matters decided by such Tribunals were challenged

before High Courts.

Other problems had also been highlighted by the respondent-

State in the counter-affidavit which necessitated the State to take a

decision to abolish it. It included steep increase in pendency of cases,

construction of infrastructure, huge finance, maintenance of recurring

expenses, etc. The policy makers of the State had been continuously

monitoring the Tribunal's progress and performance as dispensation

of justice was an important priority of the State.

Parliament meanwhile passed the Act of 2000 on 18th

September, 2000 providing re-organisation of the erstwhile State of

Madhya Pradesh into two States. Sub-section (1) of Section 74 of the

Act allowed both the States to continue functioning of the Tribunal in

the successor States. It, however, authorized them to take a decision to

abolish State Administrative Tribunal by mutual agreement. Thus, the

power had been conferred by Parliament on States of Madhya Pradesh

and Chhattisgarh to take an appropriate decision with regard to

continuation or abolition of State Administrative Tribunal. Such

action, therefore, cannot be said to be illegal or contrary to law. The

Act of 2000 has been enacted by Parliament in exercise of powers

under Articles 2 to 4 of the Constitution of India. The Act, therefore,

cannot be said to be unconstitutional or ultra vires.

Respondent No.1 Government of India also filed a counter-

affidavit confirming that the State of Madhya Pradesh was "free to

recommend abolition of the Madhya Pradesh Administrative

Tribunal". It was stated that the Central Government would examine

the proposal of the State Government to abolish State Administrative

Tribunal keeping in view several factors, such as, alternative forum

proposed by the State Government for disposal of pending cases,

compensation/rehabilitation of various functionaries of the Tribunal,

etc. On interpretation of Section 74 of the Act of 2000, the Central

Government stated that the State of Madhya Pradesh cannot of its own

abolish State Administrative Tribunal which was set up by the Central

Government under Section 4(2) of the Administrative Tribunals Act,

1985. According to the deponent, Section 74(1) of the Act of 2000

was "only an enabling provision to facilitate the State Government to

take a decision about the continuance or otherwise of the Madhya

Pradesh Administrative Tribunal".

Further affidavit was also filed by the State of Madhya Pradesh

wherein a reference was made to an order of Council of Ministers

dated 8th March, 2001 to abolish the Madhya Pradesh Administrative

Tribunal.

The Division Bench of the High Court of Madhya Pradesh,

after hearing the parties, held that the provisions of sub-section (1) of

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Section 74 of the Act of 2000 are intra vires the Constitution and the

State of Madhya Pradesh possessed power to abolish the State

Administrative Tribunal. No direction from the Central Government

as envisaged by sub-section (4) of Section 74 was required.

According to the Court, Section 74(1) conferred unfettered power on

both successor States to take a decision in regard to the abolition of

Tribunal. It was thus in the exclusive discretion of the successor

States and no power or authority had been given to the Central

Government in the said process. The Court also indicated that

Parliament appeared to have granted "an opportunity of re-

determination to both the successor States in view of substantial

changed circumstances necessitating review of all existing bodies

keeping the experience of the old State".

Regarding sub-sections (2) and (3) of Section 74 of the Act of

2000, however, after considering Articles 309 and 310 of the

Constitution of India and Sections 8, 9 and 10 of the Administrative

Tribunals Act, 1985, the High Court held that the State could not have

ignored statutory and constitutional provisions. Sub-sections (2) and

(3) of Section 74 were thus ultra vires Articles 14, 16 and 21 of the

Constitution. The High Court, however, recorded the statement of the

learned Advocate General of the State of Madhya Pradesh that the

State Government shall abide by the decision of the court with regard

to officers and employees of the Government.

The High Court also held that after taking a decision to abolish

the Madhya Pradesh State Administrative Tribunal, the State

Government had to request the Central Government for issuance of

necessary notification for abolition of such Tribunal since it has been

established by the Central Government. According to the Court,

however, the Central Government had no option but to accept the

request of the State Government. In the light of the said decision,

notification, circular and order dated 25th July, 2001 were quashed by

the Court.

In the operative part of the judgment, the High Court issued

following directions:-

(i) The State Government of Madhya Pradesh is

empowered under Section 74(1) of the M.P. Re-

organisation Act to abolish the State

Administrative Tribunal.

(ii) No directions from the Central Government as

envisaged under sub-section 4 of Section 74 of the

Act of 2000 are necessary to take the above

decision to abolish the Tribunal.

(iii) After taking decision to abolish the State

Administrative Tribunal, the State Government

will have to make request to the Central

Government to issue notification for abolish of the

State Administrative Tribunal.

(iv) The Central Government has no option but to

accept the request received from the state

Government to abolish the State Administrative

Tribunal and accordingly issue a notification

rescinding the earlier Notification establishing the

same.

(v) The sub-sections (2) and (3) of Section 74 of the

M.P. Reorganisation Act are declared ultra vires.

(vi) Since the notification (Annexure P-1) abolishing

the State Administrative Tribunal has been issued

by the State Government itself, and not by the

Central Government, the notification (Annexure P-

1) shall stand quashed.

(vii) Consequent to quashment of the Notification

(Annexure P-1), the Circular Annexure P-2) and

the Order (Annexure P-3) also stand quashed.

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(viii) Since the Madhya Pradesh Ordinance No. 3 of

2001 has lapsed, no order is necessary to quash the

same.

(ix) On abolition of the Tribunal, the Chairman, Vice

Chairman and Members shall be entitled to have

compensation for unexpired term of their services

from the State Government. The details shall be

worked out as per principles of natural justice.

(x) On abolition of the Tribunal, the officers and

employees thereof shall be dealt with by the State

Government as per their service conditions,

including their absorption in other Departments of

the State Government.

Being aggrieved by the order passed by the High Court, the Bar

Association instituted Special Leave Petition (Civil) No.16108 of

2002 on July 11, 2002. It may be stated that in other matters also,

leave was sought by the petitioners to approach this Court by filing

Special Leave Petitions. In Special Leave Petition Nos.23615 and

23616 of 2002, the decision upholding constitutional validity of sub-

section (1) of Section 74 of the Act of 2000 is challenged. We may

also observe at this stage that Writ Petition No. 374 of 2003 was filed

by one Chhadami Lal and Writ Petition No. 369 of 2003 by the

Government Employees Class III Association. Union of India has

also challenged the decision of the High Court of Madhya Pradesh in

Civil Appeal Nos.8292-95 of 2002 against certain directions of the

High Court.

On August 26, 2002, leave was granted by this Court and

hearing was ordered to be expedited. Other matters which were

subsequently filed were also ordered to be heard along with Civil

Appeal No.5327 of 2002.

We have heard the learned counsel for all the parties.

Mr. Prashant Bhushan, learned counsel for the appellant

contended that the action of abolishing Madhya Pradesh State

Administrative Tribunal is illegal, improper and unlawful. According

to him, the State Administrative Tribunal had been established under

the Administrative Tribunals Act, 1985 enacted by Parliament in

exercise of power under Article 323A of the Constitution. Such

Tribunal, therefore, cannot be abolished by a State. It was further

submitted that Section 74 of the Act of 2000 by which Parliament

authorized the State Government to discontinue or abolish State

Administrative Tribunal is ultra vires the Constitution as no such

power could have been delegated to the State. It was also urged that

the delegation of power to abolish State Administrative Tribunal

conferred on the State Government by Parliament under the Act of

2000 is in the nature of "excessive delegation" and would be

inconsistent with the provisions of the Constitution as also contrary to

several decisions rendered by this Court wherein it has been observed

that a competent legislature cannot delegate essential legislative

function or legislative policy. The High Court, in the circumstances,

ought to have declared sub-section (1) of Section 74 ultra vires.

Alternatively, it was submitted that even if this Court holds that

Parliament was competent to delegate its power to the State

Government to discontinue the State Administrative Tribunal, the

impugned action of the State of Madhya Pradesh is illegal, unlawful

and mala fide. It was contended that the Tribunal has been abolished

as, according to the Government, in many matters it had passed orders

against the Government and granted interim relief in "transfer"

matters. It was, therefore, contended that what weighed with the State

Government for abolishing the State Administrative Tribunal was

"judicial orders" passed by a competent Tribunal in exercise of its

undoubted jurisdiction thereby taking into account irrelevant

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consideration and such a decision cannot be said to be a decision in

the eye of law and the action deserves to be set aside.

It was also urged that from the affidavit in reply filed on behalf

of the State, it was clear that it had also considered the criticism

against working of Tribunals by Malimath Committee. The report of

the said Committee, however, has been commented upon by this

Court in L. Chandra Kumar and the criticism by the said Committee

against the working of the Tribunals was not approved. It was,

therefore, submitted that if on the basis of such criticism an action is

taken, the same deserves to be quashed.

On merits, counsel contended that there was no need for

abolishing the Tribunal. No reasons for such abolition have been

mentioned anywhere. No study was conducted regarding functioning

of the Tribunal. Statistics had shown that several cases had been

adjudicated and decided by the Tribunal and even after the decision of

this Court in L. Chandra Kumar, only few matters had reached the

High Court and in the rest of the matters, the decisions of the Tribunal

had not been challenged. Thus, it was not right, as stated by the State

of Madhya Pradesh, that after the decision in L. Chandra Kumar, the

Tribunal remained as "additional tier" in the administration of justice.

If that was the basis and foundation on which the State had taken a

decision, the same being incorrect in fact and untenable at law, the

order of abolishing the Tribunal deserves to be set aside. In this

connection, the counsel submitted that ambit and scope of jurisdiction

of Administrative Tribunals exercising power under the Act and of the

High Court under Articles 226 and 227 of the Constitution is totally

different and distinct. Even if the decision rendered by the Tribunal

can be made subject matter of writ jurisdiction/supervisory

jurisdiction of a High Court under Article 226/227 of the Constitution,

the later exercises the power of "judicial review" and neither original

nor appellate power. The sweep and extent of two jurisdictions

cannot be compared. The learned counsel submitted that all these

points have not been appreciated in their proper perspective by the

High Court and the decision of the High Court suffers from non-

application of mind and non-consideration of relevant aspects and

needs interference.

Other counsel appearing in the remaining matters supported Mr.

Prashant Bhushan and adopted the arguments put forward by him.

They also submitted that an attempt has been made by the State of

Madhya Pradesh to interfere with judicial functioning of the Tribunal

which is violative of the "basic feature of the Constitution" which

protects and safeguards the independence of judiciary and such action

deserves to be quashed and set aside by this Court.

Mr. B. Datta, learned Additional Solicitor General for the

Union of India has voiced grievance against some of the conclusions

reached by the High Court, particularly, that the State of Madhya

Pradesh has the authority to abolish the State Administrative Tribunal

and if a request is made by the State Government to the Central

Government to abolish the Tribunal, the latter has no option but to

accept such request.

The learned counsel appearing for the State of Madhya Pradesh,

on the other hand, supported the order passed by the High Court.

According to him, the State Administrative Tribunal was constituted

and established in the State only at the request of the State of Madhya

Pradesh. It was, therefore, clear that the State of Madhya Pradesh

wanted establishment of such Tribunal. Obviously, therefore, it was

open to the State if it felt that continuance of such Tribunal would not

be in the larger interest. It was also urged by the counsel that the State

Government realised the need and necessity of such Tribunal in the

light of the provisions of Article 323A of the Constitution as amended

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by the Constitution (42nd Amendment) Act, 1976 and after 1985 Act

by Parliament. The counsel also submitted that the validity of 1985

Act came up for consideration before this Court in S.P. Sampath

Kumar v. Union of India (1987) 1 SCC 124 : AIR 1987 SC 386 and

the constitutional validity of the Act had been upheld. Virtually

therefore, after the decision in S.P. Sampath Kumar, the

Administrative Tribunal was held "substitute" of the High Court. The

State of Madhya Pradesh, therefore, thought it proper to have such

Tribunal. Accordingly, a request was made and the Tribunal was

established in 1988. But the position was substantially altered after

the decision in L.Chandra Kumar. In the said case, this Court held

that the power of "judicial review" conferred on all High Courts by

the Constitution is a basic feature of the Constitution. Such power

cannot be taken away even by an amendment in the Constitution.

Clause (d) of Article 323A(2) and Clause (d) of Article 323B(3) of the

Constitution were, therefore, held ultra vires. The consequence of the

decision in L. Chandra Kumar was that after a decision by the State

Administrative Tribunal, an aggrieved party can approach the High

Court within the territorial jurisdiction of which a decision has been

rendered by such Tribunal and such decision could be made subject

matter of judicial review before the High Court. Considering the

above fact, the Council of Ministers thought that it would not be

appropriate to have such Tribunal in view of the decision in L.

Chandra Kumar. According to the counsel, such a decision could

never be termed as arbitrary, unreasonable or mala fide. Therefore,

even if it is assumed that all the matters which had been decided by an

Administrative Tribunal may not be taken to High Court, it cannot

prevent the Council of Ministers to take an appropriate decision as to

continuance or otherwise of the State Administrative Tribunal. It was

a policy decision. The question is not of advisability or propriety of

such decision, but legality and constitutionality thereof. If the

decision is otherwise legal, valid and in accordance with law, it cannot

be set aside. A court of law can interfere with such decision only if it

is unconstitutional or without authority of law. It was submitted that

even Parliament considered the fact that the Tribunal was established

for adjudication of service disputes in the State of Madhya Pradesh

and at the request of the State, such Tribunal was constituted. Hence,

a provision was made in Section 74 of the Act enabling the State

Governments to continue or not to continue such Tribunal. Such a

provision cannot be termed arbitrary or unreasonable. There is no

delegation of legislative power by Parliament on the State. Since, the

State Government had requested the Central Government to constitute

a Tribunal and a Tribunal had been constituted, Parliament thought it

appropriate to authorize the State Government to decide as to whether

such Tribunal should be continued or abolished. There is, thus, no

"excessive delegation" in such matters and the High Court was fully

justified in repelling the contention of the petitioners-appellants and in

dismissing the petition.

Regarding mala fide exercise of power, it was submitted that

there was no material to show that the action was not bona fide or has

been taken in colourable exercise of power. There is nothing to

substantiate such bald allegations. Though it was asserted that the

Tribunal has been abolished because it had passed certain "judicial

orders", it is merely ipse dixit and based on newspaper reports. From

the record, it is clear that the State considered the decision in L.

Chandra Kumar and a satisfaction had been reached by the Council of

Ministers that there would be "one more tier" if Administrative

Tribunal would be continued. Accordingly, it was resolved to abolish

the Tribunal. Such a decision cannot be said malicious or mala fide.

It was, therefore, submitted that the appeal deserves to be dismissed.

So far as constitutional validity and vires of sub-section (1) of

Section 74 of the Act is concerned, in Mukesh Kumar Misra and

Another v. Union of India and Others (W.P. No.2398 of 2001 decided

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on 3rd July, 2001), the Division Bench of the High Court of Madhya

Pradesh upheld the validity thereof. Considering the provisions of the

Constitution including Article 323A and the relevant provisions of the

Act, the Court held that Parliament was competent to enact the Act of

2000 and it was open to Parliament to confer power on the States of

Madhya Pradesh and Chhattisgarh to take an appropriate decision as

to continuance or otherwise of any Commission, Authority, Tribunal,

University, Board or any other body constituted under the Central Act,

State Act or Provincial Act "having jurisdiction over the existing State

of Madhya Pradesh". The Court also held that discretion had been

conferred on both the State Governments to abolish the Tribunal if

they wished to do so. The Court noted that Article 323A of the

Constitution was merely an enabling provision and it was not

incumbent on State Governments to constitute a Tribunal under the

Act of 1985. In the opinion of the Court, there was no inconsistency

or conflict between Section 74(1) of the Act of 2000 and Article 323A

of the Constitution or Section 4 of the Administrative Tribunals Act,

1985. It was also observed that sub-section (1) of Section 74 of the

Act of 2000 opens with non obstante clause ("Notwithstanding

anything contained in any other law for the time being in force") and

allows the States of Madhya Pradesh and Chhattisgarh to continue or

to abolish Tribunals in the respective States. In this connection, it is

also profitable to refer to Section 85 which declares that the

provisions of "this Act shall have effect notwithstanding anything

inconsistent therewith contained in any other law". Conjoint reading

of Article 323A of the Constitution, Section 4 of the Administrative

Tribunals Act 1985 and Sections 74(1) and 85 of the Act of 2000, in

our considered opinion, leaves no room of doubt that Parliament

authorized the State of Madhya Pradesh as well as the new State of

Chhattisgarh to take an appropriate decision with regard to State

Administrative Tribunals having jurisdiction over those States.

Parliament empowered both the successor States to take an

appropriate decision to continue such Tribunals, to abolish them or to

constitute separate Tribunals. It cannot be said that by enacting such

a provision, Parliament had violated any mandate or the Act of 2000

is ultra vires Article 323A or any other part of the Constitution.

It was then contended that once the power to constitute a

Tribunal had been exercised, Parliament was denuded of any power to

make any legislation providing for abolition of such Tribunal. The

Division Bench negatived the contention and observed :

"It is difficult to swallow that Parliament after

enacting law on a particular subject shall have no power

to amend, modify or repeal the same. The power of the

Parliament, in our opinion, does not exhaust by

enactment of any law and we are of the considered

opinion that Parliament can make law in relation to a

subject for which it has the legislative competence,

notwithstanding the fact that law on a particular subject

was enacted by the Parliament earlier. The theory of

exhaustation is unknown so far as the legislative powers

are concerned. What Parliament has done, Parliament

can undo."

The above observations, in our view, are in consonance with

law and lay down correct proposition of law.

We are also not impressed by the argument of the learned

counsel for the appellants that in the light of the ratio laid down by

this Court in L. Chandra Kumar, an Administrative Tribunal

constituted under the 1985 Act cannot be abolished. What has been

held by this Court in L. Chandra Kumar was that the jurisdiction

conferred on this Court under Articles 32 and 136 of the Constitution

as also of the High Courts under Articles 226 and 227 of the

Constitution is a part of the "basic structure" of our Constitution.

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That jurisdiction cannot be ousted by making any provision in the

Constitution also. So far as Tribunals are concerned, they may

perform a "supplemental role" in the discharge of power conferred

upon the Supreme Court as well as upon High Courts. From that,

however, it cannot be said that once a Tribunal is constituted, created

or established, there is no power either in the Central Government or

State Governments to abolish it. There is no constitutional or

statutory prohibition against exercise of such power. To us, it is clear

that Parliament which allowed the State Government to request the

Central Government for establishment of an Administrative Tribunal

under the 1985 Act has authority, power and jurisdiction to enable the

State Government to take an appropriate decision to continue or not

to continue such Tribunal and a provision by Parliament authorizing

the State Government to abolish such Tribunal, by no stretch of

imagination, can be held ultra vires the Constitution or inconsistent

with the law laid down by this Court in L. Chandra Kumar.

Under the Constitution of India, the power to legislate is with

the Legislature. The said power of making laws, therefore, cannot be

delegated by the Legislature to the Executive. In other words, a

Legislature can neither create a parallel legislature nor destroy its

legislative power. The essential legislative function must be retained

by the Legislature itself. Such function consists of the determination

of legislative policy and its formulation as a binding rule of conduct.

But it is also equally well-settled that once the essential legislative

function is performed by the Legislature and the policy has been laid

down, it is always open to the Legislature to delegate to the Executive

authority ancillary and subordinate powers necessary for carrying out

the policy and purposes of the Act as may be necessary to make the

legislation complete, effective and useful.

Mr. Bhushan, learned counsel for the appellants invited our

attention to the leading case of In re: The Delhi Laws Act, 1912 (1951

SCR 747). The question which arose before this Court in that case

was of "great public importance" and was "first of its kind". The

Central Government was authorized by Section 2 of Part C States

(Laws) Act, 1950 to extend to any Part C State with such

modifications and restrictions as it thinks fit, any enactment in force in

Part A State. While doing so, the Government was also authorized to

repeal or amend any corresponding law (other than a Central Act)

which might be in force in Part C State. While dealing with the

Reference under Article 143 of the Constitution of India, this Court

opined that keeping the exigencies of the modern Government in

view, Parliament and State Legislatures in India needed to delegate

legislative power, if they were to be able to face the multitudinous

problems facing the country, as it was neither practicable nor feasible

to expect each of the legislative bodies to enact complete and

comprehensive legislation on all subjects sought to be legislated upon.

It was also observed that since the legislatures in India derive their

powers from written Constitution, they could not be allowed the same

freedom as the British Parliament has in the matter of delegation.

Relying on some of the observations, the learned counsel

submitted that the provisions of sub-section (1) of Section 74 of the

Act of 2000 must be held ultra vires. The counsel referred to the

following observations of Kania, C.J.:

"A fair and close reading and analysis of all these

decisions of the Privy Council, the judgments of the

Supreme Courts of Canada and Australia without

stretching and straining the words and expressions used

therein lead me to the conclusion that while a legislature,

as a part of its legislative functions, can confer powers to

make rules and regulations for carrying the enactment

into operation and effect, and while a legislature has

power to lay down the policy and principles providing

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the rule of conduct, and while it may further provide that

on certain date or facts being found and ascertained by an

executive authority, the operation of the Act can be

extended to certain areas or may be brought into force on

such determination which is described as conditional

legislation the power to delegate legislative functions

generally is not warranted under the Constitution of India

at any stage. In cases of emergency, like war where a

large latitude has to be necessarily left in the matter of

enforcing regulations to the executive, the scope of the

power to make regulations is very wide, but even in those

case the suggestion that there was delegation of

"legislative functions" has been repudiated. Similarly,

varying according to the necessities of the case and the

nature of the legislation, the doctrine of conditional

legislation or subsidiary legislation or ancillary

legislation is equally upheld under all the Constitutions.

In my opinion, therefore, the contention urged by the

learned Attorney General that legislative power carries

with it a general power to delegate legislative functions,

so that the legislature may not define its policy at all and

may lay down no rule of conduct but that whole thing

may be left either to the executive authority or

administrative or other body, is unsound and not

supported by the authorities on which he relies. I do not

think that apart from the sovereign character of the

British Parliament which is established as a matter of

convention and whose powers are also therefore absolute

and unlimited in any legislature of any other country

such general powers of delegation as claimed by the

Attorney-General for a legislature have been recognized

or permitted." (emphasis supplied)

Keeping in view the Parliamentary position in India in

juxtaposition of British system, His Lordship proceeded to state:

"Having regard to the position of the British

Parliament, the question whether it can validly delegate

its legislative functions cannot be raised in the court of

law. Therefore from the fact that the British Parliament

has delegated legislative powers it does not follow that

the power of delegation is recognized in law as

necessarily include din the power of legislation.

Although in the Constitution of India there is no express

separation of powers, it is clear that a legislature is

created by the Constitution and detailed provisions are

made for making that legislature pass laws. Is it then too

much to say that under the Constitution the duty to make

laws, the duty to exercise its own wisdom, judgment and

patriotism in making laws is primarily cast on the

legislatures? Does it not imply that unless it can be

gathered from other provisions of the Constitution, other

bodies, executive or judicial, are not intended to

discharge legislative functions? I am unable to read the

decisions to which our attention has been drawn as laying

down that once a legislature observes the procedure

prescribed for passing a bill into an Act, it becomes a

valid law, unless it is outside the Legislative Lists in the

Seventh Schedule prescribing its respective powers. I do

not read articles 245 and 246 as covering the question of

delegation of legislative powers. In my opinion, on a

true construction of articles 245 and 246 and the Lists in

the Seventh Schedule, construed in the light of the

judicial decisions mentioned above, legislation

delegating legislative powers on some other bodies is not

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a law on any of the subjects or entries mentioned in the

Legislative Lists. It amounts to a law which states that

instead of the legislature passing laws on any subject

covered by the entries, it confers on the body mentioned

in the legislation the power to lay down the policy of the

law and make a rule of conduct binding on the persons

covered by the law."

Our attention has also been invited to similar observations of

Fazl Ali, J., who said:

"There can be no doubt that if the legislature

completely abdicates its functions and sets up a parallel

legislature transferring all its power to it, that would

undoubtedly be a real instance of delegation of its power.

In other words, there will be delegation in the strict sense

if legislative power with all its attributes is transferred to

another authority. But the Privy Council have repeatedly

pointed out that when the legislature retains its dominant

power intact and can whenever it pleases destroy the

agency it has created and set up another or take the

matter directly into its own hands, it has not parted with

its own legislative power. They have also pointed out

that the act of the subordinate authority does not possess

the true legislative attribute, if the efficacy of the act

done by it is not derived from the subordinate authority

but from the legislature by which the subordinate

authority was entrusted with the power to do the act. In

some of the cases to which reference has been made, the

Privy Council have referred to the nature and principles

of legislation and pointed out the conditional legislation

simply amounts to entrusting a limited discretionary

authority to others, and that to seek the aid of subordinate

agencies in carrying out the object of the legislation is

ancillary to legislation and properly lies within the scope

of the powers which every legislature must possess to

function effectively." (emphasis supplied)

Reference was also made to the following conclusions reached

by His Lordship:

"The conclusions at which I have arrived so far

may now be summed up:\027

(1) The legislature must normally discharge its

primary legislative function itself and not through

others.

(2) Once it is established that it has sovereign powers

within a certain sphere, it must follow as a

corollary that it is free to legislate within that

sphere in any way which appears to it to be the

best way to give effect to its intention and policy in

making, a particular law, and that it may utilize

any outside agency to any extent it finds necessary

for doing things which it is unable to do itself or

finds it inconvenience to do. In other words it can

do everything which is ancillary to and necessary

for the full and effective exercise of its power of

legislation.

(3) It cannot abdicate its legislative functions, and

therefore while entrusting power to an outside

agency it must see that such agency, acts as a

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subordinate authority and does not become a

parallel legislature.

(4) The doctrine of separation of powers and the

judicial interpretation it has received in America

ever since the American Constitution was framed,

enables the American courts to check undue and

excessive delegation but the courts of this country

are not committed to that doctrine and cannot

apply it in the same way as it has been applied in

America. Therefore, there are only two main

checks in this country on the power of legislature

to delegate, these being its good sense and the

principal that it should not cross the line beyond

which delegation amounts to "abdication and self-

effacement."

On the basis of the above observations, it was submitted by Mr.

Prashant Bhushan that by the impugned legislation, Parliament has

delegated essential legislative functions in favour of the State

Government. Such delegation is blanket and unchartered and is of

essential legislative function and legislative policy which could not

have been done. The High Court has committed an error of law in

upholding such delegation which was in substance and reality

"excessive delegation". The order passed by the High Court to that

extent suffers from legal infirmity and deserves to be interfered with

by holding sub-section (1) of Section 74 of the Act of 2000 ultra

vires.

The High Court, however, was not impressed by the argument.

In the opinion of the High Court, sub-section (1) of Section 74 of the

Act of 2000 was not in the nature of "delegated legislation" but was

"conditional legislation". Taking note of distinction between

delegated legislation and conditional legislation, the High Court held

that the power conferred by Parliament on the State Government to

abolish Tribunal on fulfillment of conditions specified in sub-section

(1) of Section 74 of the Act of 2000 could not be objected.

We find no infirmity in the approach of the High Court. In

Hamdard Dawakhana v. Union of India, (1960) 2 SCR 671, speaking

for the Constitution Bench, Kapur, J., said;

"The distinction between conditional legislation

and delegated legislation is that in the former the

delegate's power is that of determining when a legislative

declared rule of conduct shall become effective;

Hampton & Co. v. U.S., 276 US 394 : 72 L Ed 624

(1928) and the latter involves delegation of rule-making

power which constitutionally may be exercised by the

administrative agent. This means that the legislature

having laid down the broad principles of its policy in the

legislation can then leave the details to be supplied by the

administrative authority. In other words by delegated

legislation the delegate completes the legislation by

supplying details within the limits prescribed by the

statute and in the case of conditional legislation the

power of delegation is exercised by the legislature

conditionally leaving to the discretion of an external

authority the time and manner of carrying its legislation

into effect as also the determination of the area to which

it is to extend; (R. v. Burah [(1878) 3 AC 889, PC];

Russell v. R. [(1882) 7 AC 829 at p.835 : 51 LJPC 77,

PC]; King Emperor v. Benoari Lal Sarma [(1944) 72 IA

57 : AIR 1945 PC 48]; Sardar Inder Singh v. State of

Rajasthan [AIR 1957 SC 510 : 1857 SCR 605]. Thus

when the delegate is given the power of making rules and

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regulations in order to fill in the details to carry out and

subserve the purposes of the legislation the manner in

which the requirements of the statute are to be met and

the rights therein created to be enjoyed it is an exercise

of delegated legislation. But when the legislation is

complete in itself and the legislature has itself made the

law and the only function left to the delegate is to apply

the law to an area or to determine the time and manner

of carrying it into effect, it is conditional legislation."

(emphasis supplied)

We may also refer in this connection to a decision of this Court

in Sardar Inder Singh v. State of Rajasthan, (1957 SCR 605). There

the Rajasthan Tenants' Protection Ordinance was promulgated for two

years. By Section 3, the Rajpramukh was empowered to extend the

life of the Ordinance by issuing a notification, if required. The

duration of the Ordinance was extended by issuing a notification

which was challenged. This Court, however, upheld the provision

observing that it was a case of conditional legislation.

The Court said;

"In the present case, the preamble to the Ordinance

clearly recites the state of facts which necessitated the

enactment of the law in question, and s.3 fixed the

duration of the Act as two years, on an understanding of

the situation as it then existed. At the same time, it

conferred a power on the Rajpramukh to extend the life

of the Ordinance beyond that period, if the state of affairs

then should require it. When such extension is decided

by the Rajpramukh and notified, the law that will operate

is the law which was enacted by the legislative authority

in respect of "place, person, laws, powers", and it is

clearly conditional and not delegated legislation as laid

down in The Queen v. Burah [(1878)) 5 I.A. 178], and

must, in consequence, be held to be valid."

Referring to Sardar Inder Singh and reiterating the principle

laid down therein, this Court in State of T.N. represented by Secretary,

Housing Department, Madras v. K. Sabanayagam & Anr., (1998) 1

SCC 318, speaking through S.B. Majmudar, J., stated;

"It is thus obvious that in the case of conditional

legislation, the legislation is complete in itself but its

operation is made to depend on fulfillment of certain

conditions and what is delegated to an outside authority,

is the power to determine according to its own judgment

whether or not those conditions are fulfilled. In case of

delegated legislation proper, some portion of the

legislative power of the legislature is delegated to the

outside authority in that, the legislature, though

competent to perform both the essential and ancillary

legislative functions, performs only the former and parts

with the latter, i.e., the ancillary function of laying down

details in favour of another for executing the policy of

the statute enacted. The distinction between the two

exists in this that whereas conditional legislation contains

no element of delegation of legislative power and is,

therefore, not open to attack on the ground of excessive

delegation, delegated legislation does confer some

legislative power on some outside authority and is

therefore open to attack on the ground of excessive

delegation."

In the case on hand also, the Act of 2000 as enacted by

Parliament was full and complete when it left legislative chamber.

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There was, therefore, no question of delegation of legislative power

by the legislature in favour of the executive. What was left to the

executive was merely to decide whether to continue the

Administrative Tribunal or to abolish it. The State Government, after

considering the facts and circumstances decided not to continue the

Tribunal which was within the power of the State Government and,

hence, no objection can be raised against exercise of such power. The

contention of the appellants, therefore, cannot be upheld.

The matter can be looked at from another angle also. As

already indicated in the earlier part of the judgment, Article 323A is

not self-executory. The said provision did not create or establish

Administrative Tribunals. It was merely a permissive or an enabling

provision allowing Parliament to make law to establish Administrative

Tribunal if it wished to do so. Thus, there was no binding requirement

on the part of the Parliament (or State Legislature) to create such a

forum as contemplated by Article 323A of the Constitution of India.

It also cannot be overlooked that the Administrative Tribunal in

question was to be created for a particular State, i.e. State of Madhya

Pradesh. Neither under Article 323A of the Constitution nor under the

Administrative Tribunals Act, 1985, the Central Government could

have created such Tribunal except in accordance with the provisions

of sub-section (2) of Section 4 of the said Act. As already noted, the

Central Government could exercise the jurisdiction, power and

authority conferred on the Administrative Tribunal for the State by or

under the said Act only "on receipt of a request in this behalf from any

State Government". Essentially therefore, it was on the request made

by the State of Madhya Pradesh to the Central Government that the

power to create and establish Administrative Tribunal in the State of

Madhya Pradesh was exercised by the Central Government and the

Tribunal was established. We, therefore, see no objection in

conferring the power on the State Government to continue or to

abolish such Tribunal. In our considered opinion, there is no

excessive delegation by Parliament to the State Government which

would be hit either by the provisions of the Constitution or the law

laid down in In re: The Delhi Laws Act, 1912 or other decisions of

this Court.

The learned counsel for the appellants contended that for

abolishing State Administrative Tribunal, the State of Madhya

Pradesh took into account the report of the Arrears Committee

(Malimath Committee). Even in the affidavit in reply, reliance was

placed on the report of the said Committee. It was urged that this

Court in L. Chandra Kumar did not fully endorse the views expressed

by the Malimath Committee. Quoting certain recommendations on

"functioning of Tribunals", the Malimath Committee specifically

recommended that the theory of alternative institutional mechanisms

should be abandoned. It also suggested that institutional changes

should be carried out within the High Courts dividing them into

separate divisions for different branches of law as has been done in

England. According to the Committee, appointment of more Judges

would be a better way of remedying the problem of pendency in High

Courts.

This Court, while dealing with the constitutional validity of

Article 323A of the Constitution and ouster of jurisdiction of High

Courts considered the report of the Committee and observed that "its

recommendation is not suited to our present context". The Court,

however, conceded that various Tribunals have not performed up to

the expectation was "self-evident and widely acknowledged truth".

But, the Court proceeded to state that "to draw an inference that their

unsatisfactory performance points to their being founded on a

fundamentally unsound principle would not be correct". According to

the Court, "the reasons for which the Tribunals were constituted still

persist; indeed those reasons have become even more pronounced in

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our times".

The endeavor of the learned counsel is to impress upon the

Court that the reasons which weighed with the State Government in

taking a decision to abolish the State Administrative Tribunal were

illegal, non-existent, irrelevant and ill-founded. Once this Court has

held that existence of such Tribunals is a "need for the day" and the

observations of the Arrears Committee could not be said to be well-

founded, no action of abolishing the State Administrative Tribunal

could be taken by the State Government.

The contention of the learned counsel cannot be upheld. It is

true that the State of Madhya Pradesh had considered the report of the

Arrears Committee and the functioning of State Administrative

Tribunal in the State of Madhya Pradesh, but it is equally true that

when a request was made by the State of Madhya Pradesh to the

Central Government for establishment of State Administrative

Tribunal and the decision was taken by the Central Government to

create such Tribunal and a notification was issued in 1988 and the

Tribunal was established, the law governing the field was as laid

down in S.P. Sampath Kumar. L. Chandra Kumar had not seen the

light of the day. It was after the order of Reference in R.K. Jain v.

Union of India (1993) 4 SCC 119 that a Division Bench of this Court

in L. Chandra Kumar v. Union of India (1995) 1 SCC 400 referred the

matter to a Bench of seven Judges concluding that "the decision

rendered by five-Judge Constitution Bench in S.P. Sampath Kumar

needs to be comprehensively reconsidered". It is also pertinent to

note that seven-Judge Bench overruled S.P. Sampath Kumar and

unanimously held that power, authority and jurisdiction of High

Courts under Articles 226 and 227 cannot be taken away even by an

amendment in the Constitution. Clause (d) of Article 323A (2) and

Clause (d) of Article 323B (3) of the Constitution, therefore, were

held ultra vires. The resultant effect of L. Chandra Kumar was that

after an order is passed by State Administrative Tribunal, an

aggrieved party could approach the High Court by invoking

writ/supervisory jurisdiction under Article 226/227 of the Constitution

of India. So much so that after the decision by the Administrative

Tribunal, the aggrieved party was required to approach the High Court

before approaching this Court under Article 136 of the Constitution.

In this connection, it may be necessary to bear in mind the

following observations in L. Chandra Kumar:--

"We may add here that under the existing system,

direct appeals have been provided from the decisions of

all Tribunals to the Supreme Court under Article 136 of

the Constitution. In view of our above-mentioned

observations, this situation will also stand modified. In

the view that we have taken, no appeal from the decision

of a Tribunal will directly lie before the Supreme Court

under Article 136 of the Constitution; but instead, the

aggrieved party will be entitled to move the High Court

under Articles 226/227 of the Constitution and from the

decision of the Division Bench of the High Court the

aggrieved party could move this Court under Article 136

of the Constitution."

From the discussion hereinabove, it is clear that after the

Constitution (42nd Amendment) Act, 1976, the Administrative

Tribunals Act, 1985 came to be enacted by Parliament. The position

prevailed at that time was the law laid down by the Constitution

Bench of this Court in S.P. Sampath Kumar. Invoking sub-section (2)

of Section 4 of the Administrative Tribunals Act, 1985, the State of

Madhya Pradesh requested the Central Government to constitute a

Tribunal for civil servants in the State. It was also on the basis of

pronouncement of law in S.P. Sampath Kumar. The notification was

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issued by the Central Government in 1988 and the State

Administrative Tribunal was established for the State of Madhya

Pradesh. At that time, as per well-settled legal position, decisions

rendered by the Administrative Tribunals constituted under the Act of

1985 were "final" subject to jurisdiction of this Court under Article

136 of the Constitution. No person aggrieved by a decision of State

Administrative Tribunal could approach the High Court of Madhya

Pradesh in view of Clause (d) of Article 323A (2) of the Constitution

read with Section 28 of the Act of 1985 and the declaration of law in

S.P. Sampath Kumar. If, in view of subsequent development of law in

L. Chandra Kumar, the State of Madhya Pradesh felt that continuation

of State Administrative Tribunal would be "one more tier" in the

administration of justice inasmuch as after a decision is rendered by

the State Administrative Tribunal, an aggrieved party could approach

the High Court under Article 226/227 of the Constitution of India and,

hence, it felt that such tribunal should not be continued further, in our

opinion, it cannot be said that such a decision is arbitrary, irrational or

unreasonable. From the correspondence between the State of Madhya

Pradesh and Central Government as well as from the affidavit in

reply, it is clear that the decision of this Court in L. Chandra Kumar

had been considered by the State of Madhya Pradesh in arriving at a

decision to abolish State Administrative Tribunal. Such a

consideration, in our opinion, was relevant, germane and valid. It,

therefore cannot be said that the decision was illegal, invalid or

improper.

It was also contended that there is interference with judicial

functioning of the Tribunal by the Executive and such interference

would be violative of "basic structure of the Constitution" and would

result in death knell of Rule of Law. The counsel in this connection,

placed reliance on a decision of this Court in P. Sambamurthy &

Others v. State of Andhra Pradesh and Another (1987) 1 SCC 362.

In that case, vires of Clause (5) of Article 371D of the Constitution

was challenged before this Court. Article 371D was inserted in the

Constitution by the Constitution (32nd Amendment) Act, 1983.

The said clause read as under:-

"371D. Special provisions with respect to the

State of Andhra Pradesh\027

(5) The order of Administrative Tribunal finally

disposing of any case shall become effective upon

its confirmation by the State Government or on the

expiry of three months from the date on which the

order is made, whichever is earlier.

Provided that the State Government may, by

special order made in writing and for reasons to be

specified therein, modify or annul any order of the

Administrative Tribunal before it becomes

effective and in such a case, the order of the

Administrative Tribunal shall have effect only in

such modified form or be of no effect, as the case

may be." (emphasis supplied)

The reading of above clause makes it clear that it empowered

the State Government to decide whether it would confirm the order, to

modify it or even to annul it. Taking judicial notice of the fact that

"almost invariably in every service dispute before the Administrative

Tribunal" the State Government was a party, this Court noted with

concern that the said party was granted ultimate authority to uphold or

reject the determination of Administrative Tribunal. This Court, in

the circumstances, held the provision unconstitutional and ultra vires.

Speaking for the Court, Bhagwati, C.J. observed:

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"It would be open to the State Government, after it

has lost before the Administrative Tribunal, to set at

naught the decision given by the Administrative Tribunal

against it. Such a provision is, to say the least, shocking

and is clearly subversive of the principles of justice.

How can a party to litigation be given the power to

override the decision given by the Tribunal in the

litigation, without violating the basic concept of justice?

It would make a mockery of the entire adjudicative

process. Not only is the power conferred on the State

Government to modify or annul the decision of the

Administrative Tribunal starling and wholly repugnant to

our notion of justice but it is also a power which can be

abused misused." (emphasis supplied)

Putting the problem on a high pedestal, the Court added;

"This power of modifying or annulling an order of

the Administrative Tribunal conferred on the State

Government under the proviso to clause (5) is violative

of the rule of law which is clearly a basic and essential

feature of the Constitution. It is a basic principle of the

rule of law that the exercise of power by the executive or

any other authority must not only be conditioned by the

Constitution but must also be in accordance with law and

the power of judicial review is conferred by the

Constitution with a view to ensuring that the law is

observed and there is compliance with the requirement of

law on the part of the executive and other authorities. It

is through the power of judicial review conferred on an

independent institutional authority such as the High

Court that the rule of law is maintained and every organ

of the State is kept within the limits of the law. Now if

the exercise of the power of judicial review can be set at

naught by the State Government by overriding the

decision given against it, it would sound the death-knell

of the rule of law. The rule of law would cease to have

any meaning, because then it would be open to the State

Government to defy the law and yet to get away with it.

The proviso to clause (5) of Article 371-D is therefore

clearly violative of the basic structure doctrine".

(emphasis supplied)

In our considered opinion, P. Sambamurthy has no application

to the facts of the case. In that case, the Executive (Government), a

party to the proceeding was authorized to interfere with a decision

rendered by a quasi-judicial authority (Tribunal). Such a course

cannot be allowed in a democratic country and in a judicial system

governed by Rule of Law. It would totally destroy the independence

of judiciary. It was in the light of the said fact that the provision was

held ultra vires and unconstitutional.

In the instant case, there is no interference with a "judicial

order" passed by a competent court or a Tribunal, but a "policy

decision" has been taken by the State Government to abolish State

Administrative Tribunal allowing aggrieved litigants to approach

appropriate authority/court for ventilating their grievances. The ratio

laid down in P. Sambamurthy, therefore, does not apply and the

contention cannot be upheld.

It was also contended that it is the Central Government which

can issue a notification under sub-section (4) of Section 74 of the Act

of 2000. Hence, even if it is assumed that the Tribunal can be

abolished, the power has been vested in the Central Government. It is

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the Central Government which is required to issue directions for

resolution of any matter relating to any body referred to in sub-section

(1) of Section 74. Since no action has been taken by the Central

Government, abolition of the Tribunal is illegal and unlawful.

On behalf of the State of Madhya Pradesh, however, it was

submitted that the interpretation put forward by the appellants was not

correct and reliance on sub-section (4) of Section 74 was

misconceived and ill-founded. Sub-section (4) of Section 74 of the

Act of 2000 has limited application and could be invoked in case there

is dispute between the successor States, but not otherwise. "When

both the States mutually agreed for a decision, the Central

Government has neither any discretion nor any role has been given to

the Central Government". The contention, therefore, has no force.

Considering the provisions of sub-section (4) of Section 74, the

High Court stated;

"A fair reading of the above sub-section (4) of

Section 74 of the Act of 2000 makes it clear that the

above contention raised by the learned counsel appearing

for the petitioners is not based on proper and correct

interpretation of sub-section (4) of Section 74 of the Act

of 2000. If both the successor States decide by mutual

agreement to abolish the Tribunal, as envisaged in sub-

section (1) of Section 74 of the Act of 2000, it is not

obligatory for the Central Government to issue directions

as envisaged in above sub-section (4) of Section 74. This

sub-section does not contain any provision about the

issuance of notification by the Central Government for

the abolition of the Tribunal. An issuance of notification

is a mandatory requirement as the Tribunal was

established by a notification issued by the Central

Government. The sub-section (4) of Section 74 of the

Act of 2000 begins with a non-obstante clause which

indicates that the provisions of this sub-section are

independent. The provisions of sub-section (1) of

Section 74 of the Act of 2000 are not subservient to the

provisions of sub-section (4) of Section 74 of the Act of

2000. If it had been so, the words "subject to the

provisions of sub-section (4)" would have been used in

sub-section (1) of Section 74 of the Act of 2000.

Moreover, above sub-section (4) provides that the

Central Government shall issue directions for the

resolution of any matter relating to any body referred to

in sub-section (1) within any period referred to in sub-

section (1) in accordance with any mutual agreement

between the successor States or if there is no such

agreement (emphasis supplied) after consultation with

the Governments of successor States. Obviously if on

any matter relating to any body referred to in sub-section

(1), there is no mutual agreement then the directions

could also be issued by the Central Government after

consultation with the Governments of both the successor

States. A fair reading of sub-section (1) of Section 74 of

the Act of 2000, however, makes it clear that the decision

to abolish any of the bodies referred to in that clause can

be taken only by mutual agreement between the

successor States, therefore the issuance of "directions" by

the Central Government under sub-section (4) does not

include the issuance of "notification" for the abolition of

any of the body referred to in sub-section (1). The

abolition of the Tribunal does not require any "direction"

from the Central Government under sub-section (4) of

Section 74 of the Act of 2000. Such direction can only

be issued for the "resolution" of any matter and the

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decision to abolish the Tribunal taken by the successor

States by mutual agreement does not amount to a

"resolution" of any matter relating to the Tribunal. The

provisions of sub-section (4) is only in the nature of

further supplemental ancillary, or consequential

provisions to further the aims, objects and stopgap

arrangement envisaged under sub-section (1) of Section

74 of the Act of 2000. The word "direction for

resolution" means direction regarding some defect or

deadlock persists requiring intervention of the Central

Government in relation to the functioning of that body

within a period referred to in sub-section (1)."

We fully agree with the interpretation of the High

Court. In our judgment, the High Court was right in

observing that Section 74(1) is not subservient to Section 74(4)

of the Act and once the provisions of sub-section (1) of Section 74 of

the Act are attracted and invoked, the provisions of sub-section (4) of

Section 74 has no application. The contention of the appellants,

therefore, has no force and has to be rejected.

It was also argued that even if this Court comes to the

conclusion that sub-section (1) of Section 74 of the Act of 2000 is

intra-vires and constitutional confirming the view taken by the High

Court, the impugned action of abolishing State Administrative

Tribunal is mala fide and malicious. For this, learned counsel referred

to certain press reports wherein it had been alleged that a decision had

been taken at the Cabinet Meeting of the State Government to abolish

State Administrative Tribunal as the Chief Minister and all the

Ministers were of the view that State Administrative Tribunal had

granted stay in many transfer matters. The attempt on the part of the

learned counsel for the appellants was that the action has been taken

by the State of Madhya Pradesh because of adverse verdicts by the

State Administrative Tribunal. In other words, according to the

appellants, action of abolishing State Administrative Tribunal was

taken because of "judicial orders" passed by the Tribunal which was

not liked by the State Government. Such an action, submitted the

learned counsel, cannot be sustained in law.

Now, it may be stated that there is no concrete material on

record to show that the decision to abolish State Administrative

Tribunal was taken because of orders passed by the State

Administrative Tribunal. Except bald assertions by the appellants and

Press cuttings, there is nothing to substantiate such allegations. On

the contrary, sufficient material is available on record to show what

weighed with the respondent-State in taking a decision to abolish the

Tribunal. So far as allegations by the appellants are concerned, they

were emphatically denied by the State of Madhya Pradesh by filing a

counter-affidavit. Moreover, the Advocate General, appearing for the

State of Madhya Pradesh placed chronological events in detail before

the High Court which were as under;

(i) On 8.3.2001 Cabinet took decision to abolish the

Tribunal. The decision was communicated to

Press as usual. To communicate the decision of

the Cabinet to the Press is no crime.

(ii) On 18.3.2001 a letter was sent to the Government

of Chhattisgarh informing about the decision taken

by the Government of M.P. to abolish Tribunal

w.e.f. 30.4.2001.

(iii) On 27.3.2001 a reply from the Government of

Chhattisgarh was received seeking further

information etc. as the Chhattisgarh Government

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had no power.

(iv) On 3.4.2001 second letter from the Government of

Chhattisgarh was received reminding that they

were waiting fro reply of the Government of

Madhya Pradesh.

(v) On 3.4.2001 i.e. the same day the reply was sent

by the Government of Madhya Pradesh to the

Government of Chhattisgarh giving reasons for

abolition of the Tribunal and also suggesting to

constitute own Tribunal, if so desired.

(vi) On 26.4.2001 both the State Government agreed to

abolish the Tribunal for both the States.

(vii) On 5.5.2001 a letter was written by the

Government of Madhya Pradesh to Central

Government to abolish the Tribunal w.e.f.

1.6.2001.

(viii) On 17.7.2001 order was passed by the Tribunal

which is alleged to be the ground for abolition of

the Tribunal.

(ix) On 23.7.2001 a letter was received by the

Government of Madhya Pradesh from the

Government of Chhattisgarh again reiterating to

abolish the Tribunal."

Thus, from the correspondence between the State of Madhya

Pradesh and the Central Government and from various letters and

communications and also from the decision which has been taken by

the Cabinet, it is clear that the State Government took into account a

vital consideration that after the decision of this Court in L. Chandra

Kumar, an aggrieved party could approach the High Court, the object

for establishment of the Tribunal was defeated. In our opinion, in the

light of the facts before the Court, it cannot be said that the decision to

abolish State Administrative Tribunal taken by the State of Madhya

Pradesh can be quashed and set aside as mala fide.

It was finally submitted that even on merits, the action of

abolition of State Administrative Tribunal was unwarranted and

uncalled for. For that, the counsel invited our attention to facts and

figures and stated that it is not that all the cases decided by the State

Administrative Tribunal reached the High Court of Madhya Pradesh.

In most of the cases dealt with by the State Administrative Tribunal,

the parties accepted the orders of the Tribunal. It is only in few cases

that the aggrieved party \026 public servant or government \026 approached

the High Court. It was also stated that no survey has been made by

the State. No reasons have been recorded why continuance of

Tribunal was not necessary. There was non-application of mind to

this very important aspect and on that ground also, the action deserves

to be set aside at least with a limited direction to the State to

reconsider the matter and take an appropriate decision afresh keeping

in mind all relevant factors.

We are unable to uphold even this argument. In our judgment,

if a decision is illegal, unconstitutional or ultra vires, it has to be set

aside irrespective of laudable object behind it. But once we hold that

it was within the power of the State Government to continue or not to

continue State Administrative Tribunal and it was open to the State

Government to take such a decision, it cannot be set aside merely on

the ground that such a decision was not advisable in the facts of the

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case or that other decision could have been taken. While exercising

power of judicial review, this Court cannot substitute its own decision

for the decision of the Government. The Court, no doubt, can quash

and set aside the decision, if it is illegal, ultra vires, unreasonable or

otherwise objectionable. But that is not the situation here. To repeat,

from the record of the case, it is amply clear that relevant, germane,

valid and proper considerations weighed with the State Government

and keeping in view development of law and the decision of the larger

Bench of this Court in L. Chandra Kumar, a policy decision has been

taken by the State Government to abolish State Administrative

Tribunal. Parliament also empowered the State Government to take

an appropriate decision by enacting sub-section (1) of Section 74 of

the Act of 2000 and in exercise of such power, the State Government

had taken a decision. The decision, in our opinion, cannot be

regarded as illegal, unlawful or otherwise objectionable. The

contention, therefore, has no force and has to be negatived.

For the foregoing reasons, Civil Appeal No. 5327 of 2000

deserves to be dismissed and is, accordingly, dismissed.

In view of the above, Civil Appeal Nos. 8292-8295 of 2002 and

Civil Appeal arising out of Special Leave Petition No.22648 of 2002

filed by the Union of India stand disposed of and Civil Appeal No.

5328 of 2002, Civil Appeal arising out of Special Leave Petition Nos.

23615-23616 of 2002, Writ Petition No. 369 of 2003, Writ Petition

No. 374 of 2003 stand dismissed.

In the facts and circumstances of the case, however, there shall

be no order as to costs in all these matters.