
The Co-operative Societies and 97th Constitution Amendment
Constitutionality of 97th Constitution Amendment Act
Union of India v Rajendran N Shah
C.A. No. 9108-9109/2014 – D.No. 21321 / 2013 20-Jul-2021
Bench: R. F. Nariman, B. R. Gavai (Majority judgment) and K. M. Joseph (Minority Judgment)
Issues
- Constitutionality of 97th Constitution Amendment Act
- Doctrine of Severability
- Constituent power vs Legislative power
- Article 368 of the Constitution of India
Parliament’s ‘constituent power’ referred to in Article 368(1)
Though an amendment of the Constitution is the exercise of constituent power which differs from ordinary legislative power, such constituent power does not convert Parliament into an original constituent assembly. Parliament being the donee of a limited power may only exercise such power in accordance with both the procedural and substantive limitations contained in the Constitution of India. The procedural limitations are contained in Article 368(2).
A challenge to a constitutional amendment may, be on procedural or substantive grounds. The present case concerns itself with the procedural ground contained in Article 368(2) proviso.
The “change” spoken about by Article 368 (2) proviso in any provision of the Constitution need not be direct in the sense of adding, subtracting, or modifying the language of the particular Article or provision spoken of in the proviso. The judgments above referred to speak of a ‘change-in effect’ which would mean a change which, though not in the language of any provision of the Constitution, would yet be a change which would impact a particular article and the principle contained therein in some significant way.
There can be no doubt whatsoever that Article 246(3) read with List II of the 7th Schedule of the Constitution of India reflects an important constitutional principle that can be said to form part of the basic structure of the Constitution, namely, the fact that the Constitution is not unitary but quasi-federal in character. The question that arises before us is as to whether this principle can be said to have been infracted by inserting Part IXB into the Constitution of India so that the States’ legislative powers contained in Article 246(3) read with Entry 32 List II of the 7th Schedule can be said to have been affected in a significant manner.
It is always important to remember that in matters affecting the Constitution of India, form always gives way to substance. There can be no manner of doubt that had exceptions been provided in Entry 32 List II itself, such amendment to Entry 32 List II would require ratification. There can also be no doubt that in effect if the subject matter “co-operative societies” had been either expanded or curtailed by adding a definition clause in Article 366 of the Constitution of India, such expansion or curtailment would also require ratification as significant changes have been made in effect in Entry 32 List II of the Constitution of India. Likewise, if a separate part is added in the Constitution of India, the direct effect of adding such part being to curtail the width of Entry 32 List II in a significant manner, again, in effect Entry 32 List II is directly impacted, again requiring ratification. It is of no moment that one method is chosen or preferred to another so long as Entry 32 List II is curtailed either by adding or deleting words in Entry 32 itself or by doing so through an indirect methodology, namely, adding a new definition clause in Article 366 or adding a new part to the Constitution of India.
The analysis of Part IXB of the Constitution of India, as inserted by the Constitution 97th Amendment Act
…… it is clear that the exclusive legislative power that is contained in Entry 32 List II has been significantly and substantially impacted in that such exclusive power is now subjected to a large number of curtailments. Indeed, Article 243ZI specifically mandates that the exclusive legislative power contained in Entry 32 List II of the State Legislature is now severely curtailed as it can only be exercised subject to the provisions of Part IXB; and further, Article 243ZT makes it clear that all State laws which do not conform to the restrictions mentioned in Part IXB automatically come to an end on the expiration of one year from the commencement of the Constitution 97th Amendment Act.
The aforesaid analysis of Part IXB of the Constitution leads to the result that though Article 246(3) and Entry 32, List II of the 7th Schedule have not been ‘changed’ in letter, yet the impact upon the aforesaid articles cannot be said to be insignificant. On the contrary, it is clear that by curtailing the width of Entry 32, List II of the 7th Schedule, Part IXB seeks to effect a significant change in Article 246(3) read with Entry 32 List II of the 7th Schedule inasmuch as the State’s exclusive power to make laws with regard to the subject of co-operative societies is significantly curtailed thereby directly impacting the quasi-federal principle contained therein. Quite clearly, therefore, Part IXB, insofar as it applies to co-operative societies which operate within a State, would therefore require ratification under both sub-clauses (b) and (c) of the proviso to Article 368(2) of the Constitution of India.
Example
It is interesting to note that Part IX of the Constitution of India which was inserted into the Constitution by the Constitution (73rd Amendment) Act, 1992 and Part IXA inserted into the Constitution by the Constitution (74th Amendment) Act, 1992 made similar provisions qua Panchayats and Municipalities. Entry 5 of List II, 7th Schedule………Both the Constitution 73rd and 74th Amendments were sent for ratification and were ratified by Legislatures of more than half the States.
No Substantive challenge to Part IXB
We reiterate that our judgment is confined to the procedural aspect of Article 368(2) proviso, there being no substantive challenge to Part IXB on the ground that it violates the basic structure doctrine as laid down in Kesavananda Bharati’s case (supra).
Scheme qua multi-State cooperative societies and Doctrine of Severebility
The Statement of Objects and Reasons for the Constitution 97th Amendment Act makes this clear. It states:
“The proposed new Part in the Constitution, inter alia, seeks to empower the Parliament in respect of multi-State cooperative societies and the State Legislatures in cases of other co-operative societies to make appropriate law, laying down the following matters, namely:” (Emphasis supplied)
It is clear, therefore, that the Scheme qua multi-State cooperative societies is separate from the Scheme dealing with “other cooperative societies”, Parliament being empowered, so far as multi-State cooperative societies are concerned, and the State legislatures having to make appropriate laws laying down certain matters so far as “other cooperative societies” are concerned. The effect of Article 246ZR is as if multi-State co-operative societies are separately dealt with in a separate sub-chapter contained within Part IXB, as is correctly contended by the learned Attorney General. Also, there is no doubt that after severance what survives can and does stand independently and is workable……………. This being the case, we declare that Part IXB of the Constitution of India is operative insofar as multi-State co-operative societies are concerned.
The judgment of the High Court is upheld except to the extent that it strikes down the entirety of Part IXB of the Constitution of India. As held by us above, it is declared that Part IXB of the Constitution of India is operative only insofar as it concerns multi-State cooperative societies both within the various States and in the Union territories of India.