Retrospective/ Retroactivity - Indian Laws - General

The Apex Court in State Bank's Staff Union (Madras Circle) v. Union of India- [ 2005 (9) TMI 650 - SUPREME COURT] , has observed as under: Judicial Dictionary (13th Edn.) K.J. Aiyar, Butterworth, p. 857, states that the word retrospective when used with reference to an enactment may mean (i) affecting an existing contract; or (ii) reopening up of past, closed and completed transaction; or (iii) affecting accrued rights and remedies; or (iv) affecting procedure. Words and Phrases, Permanent Edn., Vol. 37-A, pp. 224-25, defines a retrospective or retroactive law as one which takes away or impairs vested or accrued rights acquired under existing laws. A retroactive law takes away or impairs vested rights acquired under existing laws, or creates a new obligation, imposes a new duty, or attaches a new disability, in respect to transaction or considerations already past. In Advanced Law Lexicon by P. Ramanath Aiyar (3rd Edition, 2005) the expressions retroactive and retrospective have been defined as follows at page 4124 Vol.4) Retroactive- Acting backward; affecting what is past. (Of a statute, ruling, etc.) extending in scope or effect to matters that have occurred in the past. - Also termed retrospective. (Black, 7th Edn. 1999) 'Retroactivity' is a term often used by lawyers but rarely defined. On analysis it soon becomes apparent, moreover, that it is used to cover at least two distinct concepts. The first, which may be called 'true retroactivity', consists in the application of a new rule of law to an act or transaction which was completed before the rule was promulgated. The second concept, which will be referred to as 'quasi-retroactivity', occurs when a new rule of law is applied to an act or transaction in the process of completion......The foundation of these concepts is the distinction between completed and pending transactions.... (T.C. Hartley, The Foundations of European Community Law 129 (1981). Retrospective- Looking back; contemplating what is past. Having operation from a past time. 'Retrospective' is somewhat ambiguous and that good deal of confusion has been caused by the fact that it is used in more senses than one. In general however the Courts regards as retrospective any statute which operates on cases or facts coming into existence before its commencement in the sense that it affects even if for the future only the character or consequences of transactions previously entered into or of other past conduct. Thus, a statute is not retrospective merely because it affects existing rights; nor is it retrospective merely because a part of the requisite for its action is drawn from a time and antecedents to its passing. (Vol.44 Halsbury's Laws of England, Fourth Edition, page 570 para 921). The question of retrospectively affecting the award is factually of academic interest. It was admitted before the High Court that all amount payable under the award for the prior period has been paid. In Harvard Law Review, Vol. 73, p. 692 it was observed that it is necessary that the legislature should be able to cure inadvertent defects in statutes or their administration by making what has been aptly called 'small repairs'. Moreover, the individual who claims that a vested right has arisen from the defect is seeking a windfall since had the legislature's or administrator's action had the effect it was intended to and could have had, no such right would have arisen. Thus the interest in the retroactive curing of such a defect in the administration of government outweighs the individual's interest in benefiting from the defect .