1961 (3) TMI 121 - SC - Indian Laws

Summary

Issues Involved:

1. Validity of Section 87-B of the Code of Civil Procedure under Article 14 of the Constitution.
2. Applicability of Section 87-B to suits pending before its enactment.
3. Liability of the defendants as agents under Section 230 of the Indian Contract Act.

Issue-wise Detailed Analysis:

1. Validity of Section 87-B of the Code of Civil Procedure under Article 14 of the Constitution:

The appellant contended that Section 87-B of the Code of Civil Procedure was ultra vires the Constitution, as it discriminated in favor of ex-Rulers of Indian States by creating immunity from civil actions, which allegedly violated the equality clause in Article 14 of the Constitution. The court examined the historical context, noting that the Rulers of Indian States had entered into covenants and agreements with the Government of India, which assured the continuation of their privileges, dignities, and titles. Article 362 of the Constitution was cited, which mandated due regard to these guarantees. The court held that the ex-Rulers formed a distinct class based on historical considerations and that the special legislation was justified. The term "privilege" was deemed sufficiently broad to include immunity from civil actions. Thus, the court concluded that Section 87-B was not discriminatory and was constitutionally valid.

2. Applicability of Section 87-B to suits pending before its enactment:

The appellant argued that Section 87-B should not apply to suits that were already pending when the section was enacted, asserting that the right to continue the suit was a substantive right that could not be taken away without explicit language or clear intent in the law. The court analyzed the language of Section 86(1), which stated, "No Ruler of a foreign State may be sued in any court," and interpreted the term "sued" to encompass not only the initiation but also the continuation of a suit. The court concluded that the consent of the Central Government was required both for filing and continuing a suit against an ex-Ruler. Therefore, the pending suit against the ex-Ruler of Jaipur was deemed incompetent without such consent.

3. Liability of the defendants as agents under Section 230 of the Indian Contract Act:

The appellant contended that the second and third defendants acted as agents of the ex-Ruler in placing the orders. The court noted that the second defendant, the Military Secretary, had since died, and no cause of action survived against him. Regarding the third defendant, Mohabat Singh, the court found that he merely signed letters on behalf of the Military Secretary and did not act as an agent of the ex-Ruler. Consequently, the suit against Mohabat Singh was considered misconceived. The court held that the remaining defendants were protected by Section 230 of the Indian Contract Act, which shields agents from liability when they act on behalf of a disclosed principal.

Conclusion:

The court dismissed the appeal, upholding the dismissal of the suit against the ex-Ruler due to the lack of consent from the Central Government as required by Section 87-B. The court also found no liability on the part of the third defendant, Mohabat Singh, as he was not acting as an agent. The appellant was ordered to pay the costs of the appeal and court fees. The appeal was dismissed with costs.