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Issues Involved:
1. Whether the Madhya Pradesh Abolition of Cash Grants Act of 1963 is ultra vires the Constitution. 2. Whether the abolition of cash grants under the Act amounts to compulsory acquisition under Article 31(2) of the Constitution. 3. Whether the Act violates Article 19(1)(f) of the Constitution. Issue-wise Detailed Analysis: 1. Constitutionality of the Madhya Pradesh Abolition of Cash Grants Act of 1963: The primary issue in these appeals is whether the Madhya Pradesh Abolition of Cash Grants Act of 1963 is ultra vires the Constitution. The respondents were entitled to receive cash grants from the Government of Madhya Pradesh, which were abolished by the impugned Act, providing for certain compensation. The High Court of Madhya Pradesh rejected most of the respondents' contentions but held that the Act violated Article 19(1)(f) and was not saved by sub-Article (5). The Supreme Court, in agreement with the High Court, opined that the Act is violative of Article 31(2) or, alternatively, Article 19(1)(f) of the Constitution, thus not addressing other contentions. 2. Abolition of Cash Grants as Compulsory Acquisition under Article 31(2): The High Court had concluded that the abolition of cash grants did not amount to compulsory acquisition under Article 31(2) as it did not transfer the rights of grantees as provided in Article 31(2A). The Supreme Court noted that while the language of Article 31(2) could prima facie include movable properties like money, there are grounds to hold that money and choses in action are outside its reach. Citing precedents like State of Bihar v. Kameshwar Singh and Bombay Dyeing and Manufacturing Co. Ltd v. State of Bombay, the Court held that money and choses in action could not be acquired under Article 31(2). The Court emphasized that the power under Article 31(2) is not a taxing power and cannot be used to enrich the State's coffers, which cannot be considered a public purpose under Article 31(2). 3. Violation of Article 19(1)(f): The High Court had determined that a "cash grant" is property within the meaning of Articles 19(1)(f) and 31, a conclusion not challenged before the Supreme Court. The Court reiterated that a right to a sum of money is property. The State's argument that the Act could be valid under Article 31(1) was also rejected. The Court held that a law under Article 31(1) must be valid and not violate Article 19(1)(f), meaning it must satisfy Article 19(5). The Act, which appropriates someone else's property to augment State resources, cannot be considered a reasonable restriction in the interest of the general public. The Court cited Kavalappara Kottarathi Kochuni v. State of Madras, which held that laws under Article 31(1) could only be sustained if they imposed reasonable restrictions in the interest of the general public. The Court concluded that interpreting Article 19(5) to allow the State to take property to increase its assets would render Article 19(1)(f) meaningless. Conclusion: The Supreme Court dismissed the appeals, holding that the Madhya Pradesh Abolition of Cash Grants Act of 1963 is unconstitutional as it violates Articles 31(2) and 19(1)(f) of the Constitution. The appeals were dismissed with costs.
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