1986 (5) TMI 13 - HC - Indian Laws

Issues Involved:
1. Competence of the State Legislature to enact Article 15 of Schedule I of the Bihar and Orissa Public Demands Recovery Act.
2. Definition and scope of "public demand."
3. Legislative entries and their interpretation.
4. Alternative statutory remedies and their adequacy.
5. Doctrine of pith and substance in legislative competence.

Detailed Analysis:

1. Competence of the State Legislature to Enact Article 15 of Schedule I:
The primary issue is whether Article 15 of Schedule I of the Bihar and Orissa Public Demands Recovery Act, inserted by the Bihar Act of 1974, is beyond the competence of the State Legislature. The petitioners argued that the said article pertains to banking, a subject exclusively under the Central Government's domain as per Entry 45 of List I of the Seventh Schedule to the Constitution. The court held that the State Legislature is competent to enact Article 15 under Entry 43 of the Concurrent List III, which pertains to the recovery of public demands. It was concluded that the recovery of monies due to State-owned banks falls within the ambit of public demands and does not exclusively pertain to banking.

2. Definition and Scope of "Public Demand":
The term "public demand" is defined in Section 3(6) of the Act as any arrear or money mentioned or referred to in Schedule I. The court emphasized that this definition is deliberately broad and inclusive, allowing the Legislature to include any arrears or monies it deems fit in Schedule I. The court rejected the argument that public demand should be limited to public debt or land revenue of the State, noting that the Legislature has the authority to define and expand the scope of public demand through Schedule I.

3. Legislative Entries and Their Interpretation:
The court analyzed the relevant legislative entries, particularly Entry 45 of the Union List I (Banking) and Entry 43 of the Concurrent List III (Recovery of public demands). It was established that legislative entries should be interpreted broadly and not in a narrow or restricted sense. The court held that the recovery of monies due to State-owned banks, such as the State Bank of India and nationalized banks, falls within the scope of public demand under Entry 43 of the Concurrent List III. The court also addressed the contention that Entry 43 pertains only to recoveries outside the State, concluding that it covers recoveries both within and outside the State.

4. Alternative Statutory Remedies and Their Adequacy:
The court highlighted that the Act provides effective statutory remedies, including appeals, revisions, and reviews. Section 60 of the Act provides for statutory appeals, while Section 62 provides for revisions. The court rejected the argument that these remedies are illusory due to the requirement of depositing 40% of the amount due, citing precedents that uphold the validity of such conditions for regulating the right of appeal. The court emphasized that the existence of alternative remedies is a significant factor in determining the appropriateness of invoking writ jurisdiction under Article 226 of the Constitution.

5. Doctrine of Pith and Substance:
The court applied the doctrine of pith and substance, which holds that if the impugned legislation is substantially within the scope of a legislative entry, it remains valid even if it incidentally encroaches upon another entry. The court concluded that Article 15 of Schedule I, in pith and substance, pertains to the recovery of public demands and remains within the ambit of Entry 43 of the Concurrent List III, despite any incidental overlap with the subject of banking.

Conclusion:
The court held that Article 15 of Schedule I to the Bihar and Orissa Public Demands Recovery Act is within the competence of the State Legislature under Entry 43 of the Concurrent List III. The challenge to the constitutionality of the said article was repelled. The court also directed that the petitioners should resort to the statutory remedies provided under the Act and no technical pleas of limitation would be raised against them if they do so within one month from the date of the judgment.

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