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TMI Blog2023 (1) TMI 583X X X X Extracts X X X X X X X X Extracts X X X X ..... nefit of exemption from payment of income tax on the basis of to whom they are married to. When the Explanation refers to an individual , it includes both Sikkimese men and women, in fact, all genders; it cannot have a restrictive or myopic reference to only Sikkimese men and exclude those Sikkimese women covered under the proviso. A proviso cannot over arch a provision. But in the instant case, the proviso is overriding the provision as well as the Explanation in respect of those categories of married Sikkimese women referred to in the proviso which is impermissible. Thus, the proviso is inherently arbitrary and discriminatory against a particular category of Sikkimese women. In other words, the Explanation to Section 10 (26AAA) of the I.T. Act, 1961 includes both Sikkimese men as well as women. Such being the interpretation, in my view, the proviso is antithetical to the Explanation and the Section as well. On a conspectus consideration of the 1961 Regulation in light of the Government Orders passed subsequent to the merger of Sikkim with India by which Sikkim became a State in India and by which the Sikkim Subjects domiciled in Sikkim had their names included in the Register of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Explanation which is a reasonable classification which has a nexus to the object sought to be achieved, which is to grant of exemption from payment of income tax only to those individuals who would qualify as Sikkimese in terms of the Explanation to clause (26AAA) of Section 10 of the I.T. Act, 1961. Hence, directions in that regard have to be issued to fill the Legislative vacuum and amendment to the Explanation is necessary. However, those individuals who have been domiciled in Sikkim subsequent to 26th April, 1975 shall not be entitled to the benefit of exemption from payment of income tax. It has to be directed that till such amendment is made to the down the Explanation to Section 10(26AAA) of the I.T. Act, 1961, all individuals domiciled in Sikkim up to 26th April, 1975 shall be entitled to the exemption under the said provision from the current financial year i.e., 1st April, 2022 onwards. This direction is being issued in exercise of powers under Article 142 of the Constitution X X X X Extracts X X X X X X X X Extracts X X X X ..... name does not appear in the Register of Sikkim Subjects, but it is established beyond doubt that the name of such individual's father or husband or paternal grandfather or brother from the same father has been recorded in that register;" 3. It is the case on behalf of the respective writ petitioners that by excluding the Indians from the definition of Sikkimese, the exemption granted under Section 10(26AAA) of the Act 1961, is not available to the Indian Settlers resulting in discrimination. There is no valid ground for discriminating against this section of the residents of Sikkim alone. Therefore, it is the case on behalf of the writ petitioners that exclusion of Indians who have settled in Sikkim prior to the merger of Sikkim with India on 26.04.1975 and consequently not granting the exemption granted under Section 10(26AAA) of the Act, 1961 to the class of Indians, who have settled in Sikkim prior to the merger of Sikkim with India on 26.04.1975 is arbitrary, discriminatory and the differentia do not have a rational nexus to the object sought to be achieved by the Statute in question. It is also the case on behalf of the writ petitioners in Writ Petition No. 59 of 2013 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dia-Sikkim Peace Treaty was entered into on 05.12.1950 and under this Treaty Sikkim was to be the protectorate of India as per Article VII of the said treaty. It appears that in order to check the influx of foreigners into Sikkim, the Ruler of Sikkim (the Chogyal) promulgated the Sikkim Subject Regulations, 1961 on 03.07.1961. Under the said Regulations: (a) the persons falling under Clause 3 of the Regulations were to be entered as a "Sikkim Subject" in the Register; and (b) Persons who were citizens of another country were not to be registered as a "Sikkim Subject" unless he relinquishes the citizenship of the other country. The term 'Sikkim Subject' was defined as a person who was born in the territory of Sikkim and was resident therein and similarly situated persons, but however with a caveat that "a person shall not be a "Sikkim Subject" under this section, unless he makes a declaration that he is not a citizen of any other country at the time of inclusion of his name in the register of "Sikkim Subjects". Because of this caveat, an Indian citizen whose ancestors had settled down in Sikkim for generations, had to give up his citizenship of India, for the purpo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... genuinely omitted. 4.10 In the year 1989, the Sikkim Citizenship (Amendment) Order 1989 was notified wherein a proviso was created to deem such cases of genuine omission as citizens of India. It appears that the principal beneficiaries of the said Amendment were those who had migrated to Sikkim post 1946 and were therefore not even eligible for being on the Sikkim Subject Register. 4.11 That thereafter the Government of India formed a Committee consisting of its officers and officers of the Sikkim Government and certain guidelines were made to decide who the persons were, who were omitted by mistake from being entered into the "Sikkim Subjects Register". However, these guidelines, did not apply to persons of Indian origin as they were already Indian citizens, but only to those "non- Sikkimese Subjects" who were to be made Indian citizens. 4.12 Subsequently, vide Government of India's Order dated 07.08.1990 and 08.04.1991, a total of 73,431 were granted Indian Citizenship on the basis that it was found that these persons were eligible to have been included in the "Sikkim Subjects Register". 4.13 That in the year 1989 and w.e.f. 26.07.1989, the Indian Income Tax Act, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an individual, whose name is recorded in the register maintained under the Sikkim Subjects Regulations, 1961 read with the Sikkim Subject Rules, 1961 (hereinafter referred to as the "Register of Sikkim Subjects", immediately before the 26th day of April, 1975; or (ii) an individual, whose name is included in the Register of Sikkim Subjects by virtue of the Government of India Order No. 26030/36/90 - I.C.I. dated the 7th August, 1990 and Order of even number dated the 8th April, 1991; or (iii) any other individual, whose name does not appear in the Register of Sikkim Subjects, but it is established beyond doubt that the name of such individual's father or husband or paternal grandfather or brother from the same father has been recorded in that register;" 4.18 It appears that in view of Section 10(26AAA) of the Income Tax Act, 1961, effectively 94% of the residents of Sikkim are exempted from payment of Income Tax under the Income Tax Act, 1961. However, 5% of the residents of Sikkim of which about 1% are the people like the petitioners, who, as such are also the bona fide settlers of Sikkim, are being singled out from exemption from payment of income tax on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hallenged the vires of Section 10(26AAA) of the Income Tax Act to the extent it excludes Indians, who have settled in Sikkim prior to the merger of Sikkim with India on 26.04.1975 and more particularly, the definition of "Sikkimese" in Section 10(26AAA) of the Income Tax Act and Proviso to Section 10(26AAA) of the Income Tax Act, insofar as, it excludes from the exempted category "a Sikkimese woman, who marries a non-Sikkimese after 01.04.2008", mainly on the following grounds and making the following submissions:- (i) That the definition of "Sikkimese" in Section 10(26AAA) of the Income Tax Act to the extent it excludes Indians, who have settled in Sikkim prior to the merger of Sikkim with India on 26.04.1975 is discriminatory, arbitrary and unfair and it violates the fundamental rights of those Indians, who have settled in Sikkim prior to 26.04.1975 under Articles 14 and 15 of the Constitution of India; (ii) In the definition of "Sikkimese", the old Indian settlers of Sikkim have been excluded from the purview of the definition of "Sikkimese" and therefore are not entitled to exemption from Income Tax. It is submitted that the exemption which has been granted to &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sification between the locals/residents of Sikkim, whose names have been registered as "Sikkim Subjects" in the Register maintained under the Sikkim Subjects Regulations, 1961 and those whose names could not be and/or were not registered as "Sikkim Subjects" due to nonsurrender of their Indian citizenship; (x) It is submitted that as such all the residents of Sikkim, who have settled in Sikkim prior to the merger of Sikkim with India are all to be treated at par as they are all similarly situated and therefore the classification into different groups though similarly situated is discriminatory and violative of Article 14 of the Constitution of India. It is submitted that the classification into groups should be based on identifiable criteria, which sets apart one group from the other. It is submitted that the second condition which has to be satisfied is that such a classification of a separate and identifiable group should bear a reasonable nexus with the object and purpose sought to be achieved by that law. That in the present case, none of the above two conditions are satisfied and therefore, the classification between the two groups similarly situated would be arbitrary and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that a woman is not a chattel and has an identity of her own, and the mere factum of being married ought not to take away that identity. Reliance is placed upon the decisions of this Court in the case of Anuj Garg & Ors. Vs. Hotel Association of India & Ors. (2008) 3 SCC 1 (paras 21, 22, 25, 26) and G. Sekar Vs. Geetha & Ors. (2009) 6 SCC 99 (paras 52, 54), in support to the prayer to strike down and/or hold the Proviso to Section 10(26AAA) of the Income Tax Act is discriminatory and violative of Articles 14 and 21 of the Constitution of India. 9. Shri N. Venkataraman, learned ASG has tried to justify the classification by submitting that a conscious decision has been taken by the legislature/Parliament to grant the benefit of exemption to only those "Sikkim Subjects", whose names have been registered in the Register maintained under the Sikkim Subjects Regulations, 1961. It is submitted that therefore the same may not be interfered with. However, he is not in a position to justify the classification and satisfy the Court how such a classification will achieve the object and purpose of granting exemption under Section 10(26AAA) of the Income Tax Act. He is not in a posit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inition of "Sikkimese" only those individuals, whose names are recorded in the register maintained under the Sikkim Subjects Regulation, 1961 immediately before 26.04.1975 or whose names are recorded in the Register of "Sikkim Subjects" by virtue of Government of India's Orders dated 07.08.1990 and 08.04.1991 or any other individual whose name does not appear in the Register of "Sikkim Subjects", but it is established beyond doubt that the name of such individual's father or husband or paternal grandfather or brother from the same father has been recorded in that register, are considered to be eligible as "Sikkimese" for the purpose of exemption under Section 10(26AAA) of the Income Tax Act. Meaning thereby, all those Sikkimese/Old Indian Settlers in Sikkim, who might have settled in Sikkim prior to 26.04.1975 but whose names are not registered as "Sikkim Subjects" in the register maintained under the Sikkim Subjects Regulations, 1961 are not entitled to the exemption available under Section 10(26AAA) of the Income Tax Act. At this stage, it is required to be noted that total 95% of the population of Sikkim are getting the benefit of Section 10(26AAA) of the Income Tax Act and only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive of Article 14 of the Constitution of India. 13.2 As observed and held by this Court in the case of D.S. Nakara (supra) Article 14 forbids class legislation but permits reasonable classification for the purpose of legislation, which classification must satisfy the twin tests of classification being founded on an intelligible differentia which distinguishes persons or things that are grouped together from those that are left out of the group and that differentia must have a rational nexus to the object sought to be achieved by the statute in question. In the present case, the exclusion of old Indian settlers, who have settled in Sikkim prior to the merger of Sikkim with India on 26.04.1975 from the definition of "Sikkimese" in Section 10(26AAA) does not fulfill the aforesaid two conditions. 13.3 As observed and held by this Court in the case of Manohar Singhji (supra), Article 14 declares that "the State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India". It is observed that such an obvious discrimination can be supported only on the ground that it was based upon a reasonable classification. A proper classific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry. Apart from the above, the same is clearly hit by Articles 14, 15 and 21 of the Constitution of India. The discrimination is based on gender, which is wholly violative of Articles 14, 15 and 21 of the Constitution of India. It is to be noted that there is no disqualification for a Sikkim man, who marries a non-Sikkimese after 01.04.2008. As rightly submitted, a woman is not a chattel and has an identity of her own, and the mere factum of being married ought not to take away that identity. In the case of G. Sekar (supra), it is observed and held that the exclusion of women from inheritance on the ground of gender was a clear violation of the constitutional prohibition against unfair discrimination. It is observed and held that in terms of Articles 14 and 15 of the Constitution of India, the female heirs, subject to the statutory rule operating in that field, are required to be treated equally to the male heirs. Gender equality is recognised by the world community in general in the human rights regime. 15.1 Even otherwise, there is no justification shown to exclude "a Sikkimese woman, who marries a non-Sikkimese after 01.04.2008". A Sikkimese woman, who has married a non-Sikkimes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R. JUDGMENT NAGARATHNA J. I have perused the judgment and order proposed by His Lordship M.R. Shah J. as well as the conclusions reached by him. However, I would like to render my separate opinion on the issues raised in these writ petitions revolving around the definition of "Sikkimese" appended as an Explanation to Section 10 (26AAA) of the Income Tax Act, 1961 (hereinafter referred to as 'I.T. Act, 1961') as well as on the vires of the proviso concerning Sikkimese women assailed in these writ petitions. 2. His Lordship M.R. Shah, J. has opined as follows: (i) That Section 10 (26AAA) to the extent Section 10 (26AAA) to the extent that it excludes old Indian settlers from the benefit of exemption from payment of income tax i.e. those who have settled in Sikkim prior to merger of Sikkim with India on 26th April, 1975 but whose names are not recorded as "Sikkim Subjects" from the definition of Sikkimese is ultra vires as, being arbitrary, discriminatory and violative of Article 14 of the Constitution of India. Hence, petitioners herein and similarly situated persons who are old Indian settlers who have settled in Sikkim prior to the merger of Sikkim with India on 26th April, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of 'Sikkimese Nationals'/'Sikkim Subjects' recognized as 'Persons of Sikkimese origin'; and (b) a minor population of 'British Indian Subjects' of Undivided India/'Indian Nationals' of Independent India recognized as 'Persons of Indian origin' ordinarily residing in the former Kingdom of Sikkim for the purpose of trade, commerce and Government employment/s under the 'Sikkim Darbar '. 5. The ordinarily resident 'Sikkimese Nationals/Subjects' or 'Persons of Sikkimese origin' of the former Kingdom of Sikkim comprised of persons recognized as having the following ethnicity: (i) 'Sikkimese Bhutia' - meaning persons who could be from among the native 'Bhutia' and the 'Chumbipa', 'Dopthapa', 'Dukpa', 'Kagatey', 'Sherpa', 'Tibetan', 'Tromopa', 'Yolmo' Communities which got recognised and notified as the Scheduled Tribes by 'The Constitution (Sikkim) Scheduled Tribes Order 1978' (ii) 'Sikkimese Lepcha' - meaning persons who could be from the aboriginal Lepcha Community which got recognised and notified as the Sch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... situations and conditions which have been described by the petitioners and is referred to hereunder: "(i) During the period from 1890 to 1918, the Imperial British Government exercised direct and exclusive control over the external affairs as well as the internal affairs of the Kingdom of Sikkim. At that time the British Indian Subjects were allowed to hold Office and Employment to the posts and services of the Government Establishment of the erstwhile Kingdom of Sikkim. (ii) In 1918, the then King of Sikkim Chogyal Tashi Namgyal was given back his authority over the internal affairs of Kingdom of Sikkim; whereafter he got empowered with absolute powers over all legislative, judicial and executive functions of his Kingdom; while the external affairs continued to remain under the Government of Imperial British India. From 1918 onwards, the Kingdom of Sikkim had continued to allow the British Indian Subjects to hold Office and Employment in the posts and services of the Government Establishment of the Kingdom of Sikkim i.e. 'Sikkim Darbar'. Such government employees were referred to as 'Darbar' Employees of British Indian origin. (iii) At the time immediately ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocal rights to hold government employment and buy immovable properties once settled in Sikkim and were to be treated equally with Sikkimese in all matters. (c) The Chogyal promulgated the Sikkim Subjects Regulation in 1961 (hereinafter called "1961 Regulation" for the sake of convenience). This Regulation had extraordinary provisions by which a 'National of another State' ordinarily residing in the erstwhile Kingdom of Sikkim then, could acquire a Naturalised Sikkim Subject/Citizenship status. Regulations 8(3), 8(4) of the 1961 Regulation provide for the power of the government of the erstwhile Chogyal of the Kingdom of Sikkim to naturalise a person upon an application being made in this regard. However, in order to be qualified for naturalization, the applicant/person must be employed in the Posts or Services of the Government Establishment of the Kingdom of Sikkim and must fulfil the following parameters: (i) must have been in the service of the Government of the erstwhile Kingdom of Sikkim for a period not less than ten years immediately preceding the date of his application, or (ii) must have rendered meritorious service to the erstwhile Kingdom of Sikkim. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents relevant to these cases could be traced as under: (a) By way of a statutory order, the Citizenship Act, 1955 was extended to the State of Sikkim. On 21st June, 1975, the Home Department of Government of India issued a notification titled "Sikkim (Citizenship) Order 1975" stating that 'all Sikkim Subjects under the 1961 Regulation before 26th April, 1975 were to be deemed Indian citizens'. Therefore, this effaced the distinction between persons of Indian origin residing in Sikkim (without giving up Indian Citizenship) and others who had earlier taken up Sikkimese Citizenship by entry of their names in the Sikkim Subjects Register. According to the petitioners, as on 26th April, 1975, there was no distinction between Sikkim subjects and persons of Indian origin and other settlers in Sikkim, all of them being treated as citizens of India. However, those whose names did not figure in the Sikkim Subjects Register were left out of consideration. (b) In view of the fact that a large number of eligible persons had been left out of the Sikkim Subjects Register and were consequently denied Indian citizenship, on 25th September, 1976 the Government of Sikkim issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to be entered in the register maintained under the said regulation but was not entered because of any genuine omission shall also be deemed to have become a citizen of India on that day if so determined by the Central Government." (f) On the same date i.e., 3rd April, 1989, the Ministry of Home Affairs, Government of India, constituted a committee comprising of officials of the Government of India and Government of Sikkim, to look into cases of genuine omission in terms of the Sikkim Citizenship (Amendment) Order, 1989. Certain Guidelines were prescribed to decide the persons who were left out due to genuine omission from being entered into the Sikkim Subjects Register. It is averred that in terms of "clauses d, f, g and h'' of the prescribed Guidelines, persons such as the petitioners were entitled to acquire Indian Citizenship in terms of Sikkim Citizenship (Amendment) Order, 1989, by virtue of their fathers' Government employment in 'Sikkim Darbar' prior to the commencement of the 'exception' clause introduced w.e.f., 1st April, 1974, by the Sikkim Government Establishment Rules, 1974. (g) Subsequently, vide Government of India orders dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistered in the Sikkim State Subjects Register or not. (d) It is noted that the extension of the I.T. Act, 1961, to Sikkim was not implemented in reality due to severe opposition from the State of Sikkim. Thereafter, the Government of India, vide an amendment to I.T. Act, 1961 by the Finance Act, 1994, proposed an exemption from income tax to the Scheduled Tribes in Sikkim as was being done in regard to other states. However, this was also opposed by the lone member of Sikkim in the Lok Sabha, since granting exemption only to the tribals would mean antagonizing a large extent of non-tribal population who form the bulk of the voters, due to which the said amendment was withdrawn. (e) On 19th July, 2004, the Government of India and Government of State of Sikkim, in an attempt to resolve the differences vis-à-vis implementation of I.T. Act, 1961 in Sikkim, formed a Joint Committee consisting of the members from the Central Government and Government of Sikkim. The State of Sikkim representing to the Committee repeatedly insisted on an exemption for persons holding the Sikkim Subjects Certificate (SSC) and their descendants who were made Indian Citizens vide the 1989 Sikkim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income tax. According to these petitioners, the said provision in effect exempts 94% of the residents of Sikkim while taxing the remaining 5% of which about 1% are the people such as petitioners who are bona fide settlers in Sikkim and are entitled to be treated at par with other categories. It is the grievance of the petitioners that they have been singled out for the purpose of imposition of income tax on the sole ground that their names are not recorded in the Register under the 1961 Regulation. According to these petitioners, they have Certificates of Identification and they are as much Sikkimese as those categories of persons mentioned in Section 10 (26AAA) of I.T. Act, 1961 who have been given the benefit of non-payment of income tax under the said Act. 12. It is also averred that the persons who were granted Indian citizenship by way of the Sikkim Citizenship (Amendment) Order of 1989, were those persons whose names in point of fact were never included in the Sikkim Subjects Register but were given the benefit of Indian citizenship. 13. In the context of the above grievance, various representations were made by various persons for being granted exemption from payment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Committee on the Petition, praying for protection of interest of bona fide Indian nationals living in Sikkim prior to its merger with India in the year 1975. In its deliberations, the Committee clearly found that old Indian settlers of Sikkim are to be treated at par with Sikkimese and should have been included in the said definition. It was recommended that exemption be granted to such persons as well. 18. On 4th April, 2018, an order was passed by this Court directing the petitioners in Writ Petition No. 59 of 2013 to place on record a list of persons who were claiming benefit of Section 10 (26AAA) of I.T. Act, 1961, and the State of Sikkim was further directed to verify the claims and cooperate with the Central Government so that such claims could be considered by the Central Government in accordance with law. 19. Following this order, the State Government approved two other categories of persons to be included for exemption from payment of income tax, including the petitioners' category i.e., those having COI on the basis of their fathers' being in Government of Sikkim service on or before 31st December, 1969 and who are permanently settled and residing in Sikkim along with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sikkim Subjects"), immediately before the 26th April, 1975; or 2. An individual, whose name is included in the Register of Sikkim Subjects by virtue of the Government of India Order No. 26030/36/90 - I.C.I., dated the 7th August, 1990 and Order of even number dated the 8th April, 1991; or 3. Any other individual, whose name does not appear in the Register of Sikkim Subjects, but it is established beyond doubt that the name of such individual's father or husband or paternal grandfather or brother from the same father has been recorded in that register; The relevant provision of Section 10 (26AAA) of I.T. Act, 1961, is extracted as under: "(26AAA) in case of an individual, being a Sikkimese, any income which accrues or arises to him- (a) from any source in the State of Sikkim; or (b) by way of dividend or interest on securities: Provided that nothing contained in this clause shall apply to a Sikkimese woman who, on or after the 1st day of April, 2008, marries an individual who is not a Sikkimese. Explanation. -For the purposes of this clause, "Sikkimese" shall mean- (i) an individual, whose name is recorded in the register maintained under the Sikkim S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the benefit of Section 10(26AAA) of the I.T. Act, 1961, on the sole ground that their names could not be registered as Sikkim Subjects as their forefathers did not surrender their Indian citizenship. 25. It was further contended that migrants from other Countries/erstwhile Kingdoms such as Nepalese migrants, who had migrated to and settled in Sikkim at the same time or even after migrants/settlers of Indian origin, had been admitted to the benefits of Section 10(26AAA) of the I.T. Act, 1961, while arbitrarily excluding settlers of Indian origin such as the petitioners herein. That the object sought to be achieved by the exemption provision contained in Section 10(26AAA) of the I.T. Act, 1961 was to grant exemption to the residents of Sikkim as per the definition of Sikkimese which is in the form of an Explanation to the provision. Therefore, the discriminatory classification of Sikkim Subjects vis-à-vis old Sikkim settlers, who had not been registered as Sikkim Subjects, whereby the former category of persons was admitted to the benefits of the exemption while excluding the latter, had no nexus with the object of the exemption provision. 26. It was next submitted that clas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n or a proviso vide Aphali Pharmaceuticals Ltd. vs. State of Maharashtra, (1989) 4 SCC 378. That the Explanation to Section 10(26AAA) of the I.T. Act, 1961, in effect, acts as an exception to Section 10(26AAA) of the I.T. Act, 1961 by excluding from the scope of the provision migrants/settlers of Indian origin who had settled in Sikkim much prior to the coming into effect of the 1961 Regulation. 30. It was submitted that in the present case, in order to remove the arbitrary discrimination against Indian settlers in Sikkim, the definition of the term 'Sikkimese' should be read to include Indians who had settled there as on 26th April, 1975. That this Court, in order to remedy the discrimination against the writ petitioners, ought to put the Indian settlers in Sikkim in the same class as Sikkim Subjects, for the purposes of all matters which would affect the rights, benefits and privileges of such class of persons. 31. As regards the second prong of the challenge, which is to the vires of the proviso to Section 10(26AAA) of the I.T. Act, 1961, which excludes from the exempted category, a Sikkimese woman who marries a non-Sikkimese after 1st April, 2008, it was contended by learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Finance, the I.T. Act, 1961 was extended to the State of Sikkim with effect from assessment year 1989-1990. That after the extension of the Act to the state of Sikkim, the Government of Sikkim continued to vacillate on extending co-operation for smooth implementation of the central direct tax laws in the state and constantly sought extensions for the implementation, on various grounds. In order to resolve the continuing impasse, the then Union Minister for Finance, in June 2004 constituted a committee having representation from the Government of Sikkim as well as the Central Government. During the course of deliberations of the said Committee, the then Chief Secretary, Government of Sikkim identified that Sikkimese society was based on a classification of those Indians of Sikkimese origin who voted in the referendum of 1975, and others who were residents of the erstwhile Kingdom of Sikkim, but had not voted in the referendum as they were not registered 'Sikkim Subjects.' Accordingly, it was resolved that such classification would be maintained for the purposes of determining income tax liability as any other classification would fracture Sikkimese society and lead to unrest and ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a non-Sikkimese man. It was also submitted that the benefit of the tax exemption may be extended to all Indian citizens domiciled in Sikkim irrespective of the fact as to whether their names are registered as 'Sikkim Subjects' in the 'Sikkim Subjects Register' maintained under the 1961 Regulation. 42. There is a two-pronged challenge to clause (26AAA) of Section 10 of the I.T. Act, 1961. Firstly, the proviso restricting a Sikkimese woman who marries after the 1st April, 2008, a non-Sikkimese, is excluded from the benefit under that provision. Secondly, the definition of 'Sikkimese' is also assailed in these writ petitions. The same shall be discussed in seriatim. Challenge to the Proviso to Section 10 (26AAA) of I.T. Act, 1961: 43. The proviso to Section 10(26AAA) of the I.T. Act, 1961 has been assailed. The proviso reads as under: "Provided that nothing contained in this clause shall apply to a Sikkimese woman who, on or after 1st day of April, 2008, marries an individual who is not a Sikkimese" 44. The proviso is challenged on the ground that it excludes Sikkimese women on the basis that they have married an individual who is not a Sikkimese after 1st April, 2008. In this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... between Sikkimese women themselves. Further, the said classification has no nexus to the object sought to be achieved inasmuch as when all persons who are coming within the scope and ambit of the expression "Sikkimese" as given in the Explanation to the said provision, are given the benefit of exemption from payment of income tax under the I.T. Act, 1961, there cannot be an exclusion of only Sikkimese women, who are married subsequent to 1st April, 2008, to a non-Sikkimese. 46. The thrust of the submissions of the learned Senior Counsel for the petitioners is that there is a discrimination against Sikkimese women who have got married to a non-Sikkimese, that too, only those women who have married on or after 1st April, 2008. It is contended that proviso is arbitrary for two reasons: firstly, because it is discriminatory against Sikkimese women who have married non- Sikkimese men and secondly, only those Sikkimese women who were married on or after 1st April, 2008, do not have the benefit of the provision. 47. On analysing the impugned proviso, it is noted that the benefit of the provision does not apply (i) to a Sikkimese woman, (ii) who is married to an individual who is not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Regulation (6), a woman of a foreign nationality who is married to a Sikkim Subject after the commencement of 1961 Regulation shall ordinarily be eligible to be registered as a Sikkim Subject, on making an application to the Government of the Chogyal in the manner provided by the Rules under the 1961 Regulation, and after renouncing her former nationality and on taking an oath of allegiance. (iv) Clause (b) of Regulation (7) states that any Sikkimese woman who marries a person who is not a Sikkim Subject shall cease to be a Sikkim Subject. 50. Thus, under the 1961 Regulation, as far as women are concerned, marriage has been the basis of acquiring the status of having a domicile in Sikkim and being a Sikkim Subject or losing domicile or status as a Sikkim Subject which aspect shall be discussed while considering the challenge to the proviso to Section 10 (26AAA) of the I.T. Act, 1961. 51. In my view, marriage of a Sikkimese woman is also the basis for discrimination against her whereas there is no such discrimination vis-à-vis a Sikkimese man marrying a Sikkimese or a non-Sikkimese woman on or after 1st April, 2008. Article 14 of the Constitution states that, State shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de Sikkimese women. In my view, the proviso cannot be construed to be an exception to the Explanation which is in the nature of a definition clause as it would be inherently discriminatory to do so. 53. Thus, when a benefit is being given to a Sikkimese individual which would include all genders under the provision, by way of the Explanation being added, which is in the nature of a definition, the proviso cannot exclude a certain category of married Sikkimese women from the said Explanation and thereby, deprive them of the said benefit of exemption from payment of income tax on the basis of to whom they are married to. When the Explanation refers to an "individual", it includes both Sikkimese men and women, in fact, all genders; it cannot have a restrictive or myopic reference to only Sikkimese men and exclude those Sikkimese women covered under the proviso. A proviso cannot over arch a provision. But in the instant case, the proviso is overriding the provision as well as the Explanation in respect of those categories of married Sikkimese women referred to in the proviso which is impermissible. Thus, the proviso is inherently arbitrary and discriminatory against a particular categ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oted as under: a) In Air India vs. Nergesh Meerza, AIR 1981 SC 1829, the question was, whether, a four-year bar on marriage immediately on obtaining employment in Air India, applicable only to women employees, could be retained as a reasonable provision. This Court held the same to be a sound and salutary provision on the ground that it would "improve the health of the employee" and "she becomes fully mature and there is every chance of such a marriage proving a success, all things being equal…….". The said judgment was delivered in the year 1981 but with the passage of time and owing to the worldwide movement towards gender justice and elimination of all discrimination against women, acquiring momentum, I am of the considered view that a ban on marriage in respect of a female employee immediately for a period of four years on her being appointed by the employer is also discriminatory. Hence, this aspect of gender discrimination would require a reconsideration and course correction. This is because choice of marriage as well as exercising an option as to when to marry is a Fundamental Right under Article 21 of the Constitution of India. However, in the very same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Rule 18(4) of the Indian Foreign Service (Recruitment, Cadre, Seniority and Promotion) Rules, 1961, which prohibited a married woman to be appointed in Foreign Service as of right. Although during the pendency of the writ petition, Rule 18(4) was deleted, and an affidavit was filed by the Respondent-State that Rule 8(2) was also in the process of being repealed, this Court made the following observations as regards disabilities based on marriage: "5. Discrimination against women, in traumatic transparency, is found in this rule. If a woman member shall obtain the permission of government before she marries, the same risk is run by government if a male member contracts a marriage. If the family and domestic commitments of a woman member of the Service is likely to come in the way of efficient discharge of duties, a similar situation may well arise in the case of a male member. In these days of nuclear families, inter-continental marriages and unconventional behaviour, one fails to understand the naked bias against the gentler of the species. 6. At the first blush this rule is in defiance of Article 16. If a married man has a right, a married woman, other things being equal, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 19(b) of Guardian and Wards Act, 1890. The validity of the aforesaid Sections was assailed as being violative of the equality clause of the Constitution, inasmuch as under the said provisions the mother of a minor child is relegated to an inferior position on the ground of sex alone since her right as a natural guardian of the minor, is made cognizable only 'after' the death of the father. This Court by relying upon the Convention on the Elimination of All Forms of Discrimination against Women, 1979 ("CEDAW") and the Beijing Declaration, 1995, which directs all State parties to take appropriate measures to prevent discrimination of all forms against women, observed that gender equality is one of the basic principles of our Constitution and in the event the word 'after' is to be read to mean a disqualification of a mother to act as a guardian during the lifetime of the father, the same would definitely run counter to the basic requirement of the constitutional mandate and would lead to a differentiation between a man and a woman. This Court therefore held that the father, by reason of being conferred a dominant personality, cannot be ascribed to hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Estates of Deceased Blacks (South Africa) as ultra vires. It was held by the majority that the rule of male primogeniture as it applied in customary law to the inheritance of property was inconsistent with its Constitution and invalid to the extent that it excluded or hindered women and extra-marital children from inheriting property. The South African Constitutional Court further observed that, the rules of succession in customary law had not been given the space to adapt and to keep pace with changing societal conditions and values, instead, they had over time become increasingly out of step with the real values and circumstances of the societies they were meant to serve. Thus, the official rules of customary law of succession were no longer universally observed. The South African Constitutional Court, therefore, held that, the exclusion of women from inheritance on the grounds of gender was a clear violation of the constitutional prohibition against unfair discrimination. (v) In G. Sekar vs. Geetha & Ors. (2009) 6 SCC 99 this Court observed that, in terms of Articles 14 and 15 of the Constitution of India, the female heirs, subject to the statutory rule operating in that f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advancement in the Army. Whether a particular candidate should or should not be granted a criteria or command assignment is a matter for the competent authority to consider having regard to all the exigencies of service, performance and organisational requirements. In the present case the Army has provided no justification in discharging its burden as to why women across the board should not be considered for any criteria or command appointments. Command assignments are not automatic for men SSC officers who are granted PC and would not be automatic for women either. The absolute exclusion of women from all others except staff assignments is indefensible. If the Army has cogent reasons for excluding women from a particular criteria or command appointment, it may provide them to the relevant authorities and if necessary, to future courts. However, such a justification must take place on a case-to-case basis, in light of the requirements and exigencies of a particular appointment. The blanket nonconsideration of women for criteria or command appointments absent an individuated justification by the Army cannot be sustained in law." 60. The fight for non-discrimination based on consi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counter-productive by excluding a widower. It was further observed that the Constitution of United States forbade a gender-based differentiation that resulted in less protection for the families of female workers who were required to pay Social Security taxes than was accorded to the families of male workers. The statute's gender-based distinction was based on an archaic and overbroad generalization about the contributions to family support made by male and female workers. The Court therefore held that such an irrational classification violated the right to equal protection secured by the Fifth Amendment, which prohibited discrimination that was so unjustifiable as to be violative of due process. Thus, in the aforesaid case, the right of a widower was established while at the same time emphasising that discrimination on the basis of gender violated the equality clause which provides a guarantee against such discrimination. (c) The question in Duren vs. Missouri, 439 U.S. 357, 99 S. Ct. 664 (1979) was whether the Jackson County's practice of automatically exempting women from jury service upon request violated the rights as guaranteed by the Sixth and Fourteenth Amendments. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under consideration as per the Notification dated 16th May, 1975 on the enforcement of Citizenship Act, 1955, and Citizenship Rules, 1956 to the State of Sikkim on its merger with India and as per the Sikkim (Citizenship) Order, 1975, every person who immediately before 26th April, 1975, was a Sikkim Subject as per the 1961 Regulation was deemed to have become a citizen of India on that day. Thus, an individual had a domicile in the territory of Sikkim immediately before the commencement of the 1961 Regulation, if he/she was: a) born in the territory of Sikkim and was resident therein; or b) had been ordinarily residing in the territory of Sikkim for a period of not less than fifteen years immediately preceding the commencement of the 1961 Regulation. 62. Such an individual automatically became a citizen of India and his/her name may have also been entered in the Register of Sikkim Subjects immediately before 26th April, 1975. This is also clear from the Government Order dated 7th August, 1990 which was notified by the Government of Sikkim to the effect that every person who immediately before 26th April, 1975, was a Sikkim Subject under 1961 Regulation, shall be deemed to h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... meaning of 'Sikkimese' is of significance inasmuch as it is only a 'Sikkimese' who is entitled to the benefit under the said Act. The same is under challenge in these petitions. There are three categories of persons included within the expression 'Sikkimese' given in the Explanation to the aforesaid provision namely: - A) an individual, whose name is recorded in the register maintained under the Sikkim Subjects Regulation, 1961 read with the Sikkim Subject Rules, 1961 (Register of Sikkim Subjects), immediately before 26th April, 1975; or B) an individual, whose name is included in the Register of Sikkim Subjects by virtue of the Government of India Order No. 26030/36/90 - I.C.I., dated 7th August 1990 and Order of even number dated 8th April, 1991; or C) any other individual, whose name does not appear in the Register of Sikkim Subjects, but it is established beyond doubt that the name of such individual's father or husband or paternal grandfather or brother from the same father has been recorded in that register; 67. Therefore, it is necessary to analyse each of the aforesaid Regulations, Rules, Government of India Orders for the purpose of this case as a challenge is m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me in Sikkim if he indicates an intention of returning to his country of origin, by keeping a live interest therein even though he might have parted with his property in his country of origin and the mere parting of such property will not be regarded as proof of a person's having acquired a permanent home in Sikkim. (2) The wife and minor children of a person having his domicile in Sikkim shall be deemed to have domicile in Sikkim for the purpose of this Section. (3) In any case of doubt as to whether a person has domicile within the territory of Sikkim under this Section, the matter shall be decided by The Chogyal with the assistance of a Board consisting of persons to be appointed in accordance with the rules made under this Regulation." 68.2. What is pertinent in the said Regulation is that, the following three categories of persons are stated to have domicile in the territory of Sikkim immediately before the commencement of the 1961 Regulation: - (a) a person born in the territory of Sikkim and is resident therein, or (b) has been ordinarily resident in the territory of Sikkim for a period of not less than fifteen years immediately preceding such commencement, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other than India". By such an interpretation, a person domiciled in the territory of Sikkim and who has acquired the citizenship of India may, on an application made to the authority prescribed by the 1961 Rules be registered as a Sikkim Subject, if he is a person whose ancestors were deemed to be Sikkim Subjects. 68.5. That in order to check the influx of foreigners into Sikkim, the Chogyal, in 1961, had promulgated the 1961 Regulation. Under the said Regulation: a) Persons falling under Regulation (3) of the 1961 Regulation were to be entered as 'Sikkim Subjects' in the Register; and b) Persons who were citizens of another country were not to be registered as 'Sikkim Subjects' unless they relinquished the citizenship of the other country. However, after the merger of Sikkim Kingdom with India, the expression "any other country" would not include India as all residents of Sikkim, whether a Sikkim Subject or not are now Indian citizens. But the term 'Sikkim Subject' was defined as a person who was born in the territory of Sikkim and was resident therein and all similarly situated persons, but however, with a caveat that a person shall not be a Sikkim Subject under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order to avail the benefit of exemption under clause (26AAA) of Section 10 of the I.T. Act, 1961. This would imply that the 1961 Regulation is being extended up to 26th April, 1975 for the purpose of Explanation to Section 10 (26AAA) of the I.T. Act, 1961 so as to save it from being rendered discriminatory insofar as the petitioners herein and similarly situated individuals are concerned. 68.8. Further, under the Sikkim Work Permit Rules, 1965 every 'foreigner' entering Sikkim was required to obtain a work permit from the Chief Secretary or any other officer authorised by him before he could take up or continue any employment for gain within the State of Sikkim. However, under the aforesaid Rules, the definition of 'foreigner' included all foreigners except a citizen of India. Therefore, Indian citizens or Indian nationals who became domiciled in Sikkim and were employed in Sikkim did not require a work permit. In view of the aforesaid Rules, it can be inferred that any Indian citizen who entered Sikkim for the purpose of employment prior to 26th April, 1975 was treated on par with Sikkimese and not as a foreigner. It is plausible that because of the concession given under Work Pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registration under the said Register is the basis for extending the exemption under Section 10 (26AAA) of the I.T. Act, 1961. Hence, directions have been issued so as to include persons such as the petitioners and other similarly situated persons. 69. The second category of individuals are individuals whose names have been registered in the Register of Sikkim Subjects by virtue of the Government of India Order No.26030/36/90 - I.C.I. dated 7th August, 1990 and Order of even number dated the 8th April, 1991 and notification issued by the Department of Home, Government of Sikkim dated 16th August, 1990 publishing the Government of India Order dated 7th August, 1990: 69.1. As per the Notification dated 21st June, 1975, issued by the Home Department, Government of Sikkim, it was declared that 16th May, 1975 was the date on which the Citizenship Act, 1955, shall come into force in the State of Sikkim and the Citizenship Rules, 1956, were also enforced from the aforesaid date. In fact, in exercise of the powers conferred under Section 7 of the Citizenship Act, 1955, the Government of India promulgated the Sikkim (Citizenship) Order, 1975. As per clause (2) of the aforesaid order: "E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to (e) singly or collectively are by themselves not be taken as conclusive evidence for granting citizenship, but would have to be scrutinized in the light of those at (f), (g) & (h)." 69.3. Further, the Government of India issued Notification vide Order No.26030/36/90-I.C.I. dated 8th April, 1991 and the said Order states that there were a large number of persons who were eligible to be entered in the Register as Sikkim Subjects immediately before 26th April, 1975, as per the 1961 Regulation, were not so entered because of genuine omissions. The said cases of genuine omissions were reviewed and it was recommended that the names of 73,431 persons were considered eligible for being included in the Register of Sikkim Subjects. The Ministry of Home Affairs, Government of India after consideration of the cases found that 33,348 persons were eligible to be registered under the Register of Sikkim Subjects and were deemed to have become citizens of India with effect from 26th April, 1975, in terms of the Sikkim (Citizenship) Order, 1975. 69.4. By virtue of the aforesaid Government Orders dated 7th August, 1990 and 8th April, 1991 it is clear that persons who were entitled to be regist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... close relations of the individual. Therefore, such category of individuals are also included to avail the benefit of the exemption clause. 71. On an analysis of the Explanation, it would emerge that the Register of Sikkim Subjects is the basis for granting an exemption from payment of income tax under the I.T. Act, 1961 to a Sikkimese. Therefore, the Government of India has extended opportunities for the names of individuals to be recorded in the Register of Sikkim Subjects even after the merger of Sikkim as a State with India on 26th April, 1975, by issuance of Government Orders dated 7th August, 1990 and 8th April, 1991. Further, names of individuals which do not appear in the Register of Sikkim Subjects but it is established beyond doubt that the names of such individual's father or husband or paternal grandfather or brother from the same father have been recorded in that Register, could also be included in the said Register. Hence, even as of now, if any individual's name is not entered in the Register, such individual's name could be entered into the Register by virtue of clause (iii) of the Explanation to Section 10 (26AAA) of the I.T. Act, 1961. The object of providing clau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e a State within India in the year 1975 and a special status was given to it by virtue of Article 371-F of the Constitution of India. This does not mean that all persons domiciled in Sikkim who have been treated as citizens of India are entitled to the exemption. Only such individuals are entitled to the exemption who fall within the three clauses of the Explanation. Hence, the Explanation must be construed strictly as it is in the nature of a definition of the expression "Sikkimese" for the purpose of granting an exemption from payment of income tax under the I.T. Act, 1961. However, the exemption must be extended to incorporate all such individuals who have been domiciled in Sikkim as on 26th April, 1975 and who have since then become citizens of India. This would mean that all other citizens of India who do not fall within the ambit of the Explanation as interpreted above and who have been domiciled in Sikkim State subsequent to 26th April, 1975 would not have the benefit of exemption under Section 10 (26AAA) of the I.T. Act, 1961. 76. In view of the above interpretation, in my view, the Explanation has to be saved from being in violation of Articles 14 or 15 of the Constitutio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Such as approach is being adopted rather than striking down the Explanation to Section 10(26AAA) of the I.T. Act, 1961 which would have the effect of withdrawing the benefit of exemption even from those categories of persons who are presently eligible for the same. 78. Hence, until the amendment is made, the following clause shall be read as a part of the Explanation to Section 10(26AAA) of the I.T. Act, 1961, possibly as sub-clause (iv) thereof: "(iv) any other individual, whose name does not appear in the Register of Sikkim Subjects but it is established that such individual was domiciled in Sikkim on or before 26th April, 1975." This provision would extend the benefit of exemption to those individuals, domiciled in Sikkim on the day it merged with India, i.e., 26th April, 1975. 79. In the result, the writ petitions are disposed of in the following terms: i) That the benefit of income-tax exemption presently is restricted only to those Sikkimese who fall within the three clauses of the Explanation to Section 10(26AAA) of the I.T. Act, 1961, or those persons domiciled in Sikkim, or are Sikkimese as covered under the 1961 Regulation. ii) In terms of the Sikkim (Citizen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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