Monthly Archives: November 2017

Guest Post: Bail Provisions of Section 45 PMLA Struck Down – Some Hits and Misses

(This is a guest post by Abhinav Sekhri, which first appeared on the Proof of Guilt blog)

Two days ago, a Two Judges’ Bench of the Indian Supreme Court decided a batch of writ petitions led by Writ Petition (Crl) No. 67 of 2017 titled Nikesh Tarachand Shah v. Union of India & Anr. [Nikesh Shah] in which it struck down the parts of Section 45 of the Prevention of Money Laundering Act 2002 [PMLA] which concerned the grant of bail. The Court held that these parts violated Articles 14 and 21 of the Constitution – guaranteeing a right to equality, and protection against deprivation of the right to life and personal liberty by a procedure not established by law. The effect of this judgment is that bail petitions earlier subject to a stringent standard under Section 45 PMLA will now be tested on the less taxing standards of Sections 439 and 437 of the Criminal Procedure Code 1973 [Cr.P.C.]. This post has four parts – (i) explaining how money laundering and the PMLA work (which I’d urge you to skim through even if you’re a lawyer, because at times the judgment reflects some lack of knowledge on the Court’s part), (ii) charting out how the Court did what it did, (iii) showing where the Court goes wrong, and finally (iv) what this judgment might mean for the many other statutes with similar clauses that have not been examined by the Court yet.

What is the PMLA, What are the Schedules, and What does Section 45 do?

The PMLA is India’s answer to its global commitment to tackle money laundering, which (at the cost of oversimplification) means representing assets obtained through illegal acts as untainted. In line with global standards, the PMLA covers all kinds of conduct connected with this process of representing black as white (doing, aiding, abetting, attempting etc), as long as one knowingly did so [Sections 3 and 4]. The PMLA not only makes this is an offence but also triggers connected civil actions of attaching and confiscating the tainted assets themselves [Sections 5-8].

Notice how the entire idea of money laundering is linked to some underlying illegal act which results in generating some proceeds – cash or kind. While some countries don’t require that illegal act to be a crime, India does, and the PMLA calls it a ‘Scheduled Offence’ [Section 2(y)] i.e. offences that are part of the Schedules to the PMLA. There are three Schedules – A, B, and C – and Schedule A contains the bulk of offences and Schedule C is basically the same thing applied in a transnational context. Schedule B contains only one offence – Section 132 of the Customs Act 1962 which criminalises making false declarations before customs officers. Importantly, when the underlying offence is one from Schedule B, the PMLA will only apply if the allegations involve a value of at least one crore rupees. There is no such minimum monetary limit for cases with Schedule A offences. It wasn’t always like this, and the history behind these Schedules became quite important in Nikesh Shah which requires me to discuss it here.

When the PMLA came into force in 2005, Schedule A only had two paragraphs carrying offences punishable under the Indian Penal Code 1860 [IPC] for waging war against India and nine offences from the Narcotics, Drugs and Psychotropic Substances Act 1985 [NDPS Act]. Schedule B contained the bulk of offences, along with a lower minimum threshold of thirty lakhs for the value of allegations. Then around 2010 India wanted to join the Financial Action Task Force [FATF] as a member. The FATF is a global body created by the G-8 for money laundering and membership is a big deal [India is the only South Asian member state till today]. When the FATF conducted its evaluation of Indian money laundering laws, it heavily criticised the monetary limit for the cases in Schedule B [paragraph 167 of the linked report]. The logic was that the limit would allow money laundering to escape under the radar as people would just deal in smaller tranches over a slightly elongated period of time. So the FATF recommended the limit be abolished [paragraph 175]. The government sought to do this by simply moving all Schedule B offences to Schedule A, which was done through the 2013 Amendment, leaving Schedule B empty for the time being.

In all this moving around offences, nobody thought fit to look at what impact it would have on the rest of the PMLA – specifically, on Section 45 which spoke about bail. Since the money laundering offence was tied to the Scheduled Offence, Section 45(1) looked at that underlying offence and this decided how difficult it would be to get bail. If it was a Schedule A offence with a sentence of more than three years, the law placed two additional conditions for getting bail: (i) the public prosecutor had to be given a chance to oppose bail, and if the prosecutor chose to oppose bail, then (ii) the court had to satisfy itself that the defendant was “not guilty of such offence” and was not likely to commit any offence on bail, and the burden fell on the defendant to satisfy the court. For all other Schedule A offences, and all Schedule B offences, the regular bail clauses from the Cr.P.C. continued to apply. You can see how the 2013 amendments to the Schedules completely changed the look of Section 45 – the exceptional process became the norm. This new normal was under challenge before the Supreme Court in Nikesh Shah.

SC on Section 45 – Violates Articles 14 and 21
Petitioners argued that the constitutional protections of Articles 14 and 21 were violated by Section 45 PMLA, and the Court agreed to both contentions. Rather than address arguments first and then move to the Court’s appreciation, I discuss both together for brevity.

Article 14
The Petitioners argued that linking the stringent bail clauses to offences in Schedule A that carried at least a three year maximum sentence was creating several irrational and arbitrary classifications which the Court encapsulated through examples [Paragraphs 24-27, and 35]. The Court found no basis to differentiate the harsh treatment meted out under Section 45 from the following hypothetical cases which according to the Court did not attract Section 45:

  • When there is only the PMLA charge as the trial for the Scheduled offence was complete;
  • When the PMLA allegation is based on a Schedule B offence;
  • When the PMLA allegation is based on a Schedule A offence carrying a maximum sentence below three years;
  • When a person is tried for a Part A offence with at least a three year term (versus a joint trial where the same person is tried together with the person with PMLA charges);
  • When the person is released on Anticipatory Bail under Section 438 Cr.P.C. for allegations of the Scheduled Offence, before the PMLA charge was brought in.

The Court was of the view that the seriousness of money laundering cases depended on the amount of money involved [Paragraphs 29-30]. Since Schedule A had no monetary limits, the Court concluded that the likelihood of being granted bail was being significantly affected under Section 45 by factors that had nothing to do with allegations of money laundering [Paragraphs 26-27]. When the Attorney General attempted to defend the scheme by painting the classification as a punishment-based one, the Court easily rebuffed his argument. First, the Court suggested there was no such scheme, but noted that even then, the idea should have something to do with the object of the PMLA. The Court showed how Schedule A had many offences that didn’t seem related to money laundering [taking particular objection in Paragraph 34 to offences under the National Biodiversity Act being there], leaving out others that might have more rational connections to money laundering such as counterfeiting currency [Paragraphs 29-30]. The Court also adversely commented on how Schedule A had lumped different NDPS offences together, at the cost of ignoring how the parent Act treated those offences differently [Paragraph 32-33].

The Court noted also that Section 45 of the PMLA was different from other laws that carried similar requirements such as Section 20(8) of the Terrorism and Disruptive Activities (Prevention) Act 1987 [TADA]. The ‘such offence’ in TADA required a court to be satisfied that the defendant was not guilty of the TADA offence in question before granting bail. But in the PMLA, ‘such’ offence referred to the Scheduled Offence instead of the PMLA offence. So, the restrictions imposed by Section 45 PMLA were held to have no connection to the objects of the PMLA itself and thus the rational classification, if any, violated Article 14 [Paragraph 28].

Article 21

The Petitioners argued that requiring defendants to satisfy the court that they were not guilty of ‘such’ offence violated Article 21 by reversing the presumption of innocence and required the defendant to disclose her defence at the outset of the case. In the judgment the Court doesn’t really address Article 21 independently – instead the Court suggest that because the provision violates Article 14 it cannot be ‘procedure established by law’ and therefore violated Article 21. Towards the end of the decision the Court begins discussing the argument though. It labels Section 45 a “drastic provision which turns on its head the presumption of innocence which is fundamental to a person accused of any offence.” [Paragraph 38]. In the same paragraph it goes on to observe that “before application of a section which makes drastic inroads into the fundamental right of personal liberty guaranteed by Article 21 of the Constitution of India, we must be doubly sure that such provision furthers a compelling state interest for tackling serious crime. Absent any such compelling state interest, the indiscriminate application of section 45 will certainly violate Article 21 of the Constitution. Provisions akin to section 45 have only been upheld on the ground that there is a compelling state interest in tackling crimes of an extremely heinous nature.”

Hits and Misses
There are two questions that were at stake here: (i) did any part of Section 45 offend the Constitution, and if so, (ii) did the Court have no other option but to repeal the provision. Reading the decision, it seems like the Court felt there was so much wrong in the PMLA scheme it decided to throw the kitchen sink at one point rather than explain the issues. The Court answered both affirmatively but never explained to us whether any argument dispositive, or does every case need this sort of broad argumentation to succeed.

Classification and Article 14 first. After reading the legislative history behind the 2013 amendments and the FATF argument, do you think that the Court is right in concluding that higher the monetary allegations, more serious the PMLA case? I’m not so sure. Nor do I think there is much to be gained by placing emphasis (like the Court does) on how Schedule B today has a higher limit than the initial thirty lakhs to suggest that this is in fact the case. It is far more plausible that the one crore limit was placed keeping in mind the underlying offence (false declarations to customs officials in an enquiry) and the concerns of the export industry, which is already subject to Schedule A through Section 135 of the Customs Act 1962 (evading customs duty). Rather than attempt at answering what might be the basis for such a classification for the PMLA (and indirectly giving hints to the government on what might pass muster), the Court would have done well by restricting itself to answering whether the present classification between (i) PMLA allegations based on a type of Schedule A offences versus (ii) all other PMLA cases was intelligible and connected to the objects of the PMLA. As there was enough to show that the original intent (if any) behind Section 45 had not kept apace with the subsequent amendments to the Schedules in 2013, the Court could strike down this classification. But did that require striking down the whole clause?

This brings us to the other part of what did that classification achieve. If it sought to serve as a filter for PMLA cases when it came to administering a strict bail clause, we are left with no filter. Does that mean no PMLA case is serious enough to warrant an application of the clause, or will the clause apply to every PMLA case? Deciding this would need the Court to decide whether clauses such as Section 45 that required a court to find defendants ‘not guilty’ at the bail stage were constitutional. Rather than directly address this, the Court turned to how the text of Section 45 was flawed, as it referred back to the Scheduled Offence on deciding bail petitions. Since the scheduled classification had been struck down, there was nothing to refer to, and so the clause had to go. While there is little to fault this approach, I remain unconvinced that the Court had no option but to strike down the clause because of the text. The Court has performed far greater feats of legislative reconstruction than being asked to read ‘such offence’ in Section 45 PMLA as referring to the PMLA allegations rather than only the Scheduled Offence. After all, it stands to reason that a bail provision in the PMLA would want a PMLA special court to consider the PMLA allegations. In fact, many High Court decisions show this is how they were doing it. Heck, this is how the Court itself was doing it in Rohit Tandon at the start of November [Paragraphs 21-23 of the link]. I think this course was adopted as it helped secure two objectives. Not only did this take care of the PMLA clause which this bench of the Court clearly did not like much, it also helped to protect other statutes with similar clauses which the Court held met a ‘compelling state interest’ test.

This brings me to one last bit about Article 21 and the Eighth Amendment of the U.S. Constitution. The Court cites a previous decision in Rajesh Kumar v. State (NCT) of Delhi [(2011) 13 SCC 706] for the proposition that Article 21 of the Indian Constitution has incorporated the Eighth Amendment and its protection against excessive bail [Paragraphs 13, 19 of Nikesh Shah]. The Court also cites two American decisions [Paragraph 37] on bail for good measure. This is, unfortunately, wrong. Rajesh Kumar cited previous precedent in Sunil Batra to suggest that even though India did not have the Eighth Amendment or the ‘Due Process’ clause, the consequences were the same to prevent cruel and unusual punishment. Not only did both those decisions not mention the excessive bail clause, the references to the cruel and unusual punishment clause itself are highly contentious as an earlier bench of the Supreme Court had held it couldn’t be pressed in India, and that decision continues to be cited.

Conclusion

The slapdash manner in which the PMLA Schedules were amended in 2013 to appease the FATF had already caused some High Courts to address this issue of Section 45. The closest it came to striking down the clause was the Punjab & Haryana High Court’s decision in Gorav Kathuria v. Union of India & Anr. where it held the bail provisions would not apply retrospectively to offences previously in Schedule B [Paragraphs 43-45 of Nikesh Shah]. When the Court declined to hear an appeal against the High Court order in Kathuria I thought that it had indirectly affirmed the validity of Section 45. The judgment in Nikesh Shah comes as a surprise, and marks the first occasion when the Court has looked at any part of the PMLA through a constitutional lens. There are other parts that are equally problematic – the asset forfeiture scheme and the compulsion on witnesses to make truthful declarations, for instance – that litigants may take to the Court being encouraged by this judgment.

As for the future impact of Nikesh Shah on other statutes that carry the same ‘drastic provision’, the stage is set for some litigation on that front as well. The Supreme Court has only approved of the TADA and the MCOCA provisions in the past, leaving the many others open to scrutiny on this new test of whether the provision furthers a ‘compelling state interest’. The Court never answered that for the PMLA context while deciding the petitions in Nikesh Shah. Do you think it might conclude that the PMLA does not meet the test? What about the other statutes? I’ve re-pasted my list of statutes containing the clauses below after accounting for the ones that are not relevant anymore. Comments, as always, are welcome.

  1. Section 437(1), Cr.P.C. (in cases of death and life imprisonment).
  2. Section 12AA (inserted in 1981), of the Essential Commodities Act, 1955.
  3. States of Punjab and Tripura inserted this provision as Section 439-A to the Cr.P.C. so applicable within their territory, in 1983 and 1993 respectively. This restricted bail to persons accused of certain offences, inter alia Section 121, 124-A IPC.
  4. Section 37 (amended in 1989) of the Narcotic Drugs and Psychotropic Substances Act 1985 [NDPS].
  5. Section 7A (inserted in 1994) of the Anti-Hijacking Act, 1982.
  6. Section 6A (inserted in 1994) of the Suppression of Unlawful Acts against Safety of Civil Aviation Act 1982.
  7. Section 8 of the Suppression of Unlawful Acts against Safety of Maritime Navigation and Fixed Platforms on Continental Shelf Act 2002.
  8. Section 51A (inserted in 2002) of the Wildlife Protection Act, 1972.
  9. Section 43D (inserted in 2008) of the Unlawful Activities Prevention Act, 1967 [UAPA] (nearly identical).
  10. Section 36AC (inserted in 2008) of the Drugs and Cosmetics Act, 1940.

 

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Filed under Article 14, Article 21 and the Right to Life, Bail, Criminal Law and the Constitution, Criminal Procedure, Cruel and Unusual Punishment, Equality

Guest Post: Government of Delhi vs Union of India – III: The Executive Relationship

(After a summary of the issues and a post about the legislative relationship between Delhi and the Union of India, in this, the third post in his series about the ongoing hearings at the Supreme Court, Vasudevan Devadasan examines the heart of the dispute: the question of executive power.)

Coming to the crux of the matter between the elected government of Delhi and the Lt. Governor, this post examines the extent of the executive powers possessed by the Lt. Governor under the Constitution. Executive power in parliamentary government is a result of England’s rather unique history as a constitutional monarchy. While parliament is the law-making body, executive power is exercised by the cabinet, or the council of ministers – whose members, while being part of the legislature, also formulate and implement policy of the government in power. But because England never abolished its monarchy, there also existed a nominal executive, the Queen, in whose name all decisions of the government are taken. When the Indian Constitution was adopted, there obviously existed no equivalent to the English sovereign, but such a nominal executive was deemed necessary. Therefore, we have the President (for the central executive) and the Governor (for the States).

The Union Territories, however, depart from this model. Under Article 239(1), Union Territories are to be administered by the President (i.e., by the central government), through a delegate (the Lt. Governor). Article 239AA, however, provides something of both worlds: a Lt. Governor does exist, but – under Article 239AA(4) – so does a Council of Ministers, to “aid and advise” him in his functions. As counsel for Delhi argued – both in the High Court and, over the last few weeks, in the Supreme Court – the phrase “aid and advice” is a term of art and, under the Westminster system of government, is nothing more than a euphemism for the nominal head of the Executive being bound by that “aid and advice.” (this argument will be considered below)

The Delhi High Court concluded, however, that the Lt. Governor is not bound by the ‘aid and advice’ of the council of ministers, and that the ministers must secure the approval of the Lt. Governor on all decisions prior to implementation. In effect, this meant that several initiatives of the Delhi government were invalidated because they had not received the assent of the Lt. Governor. In the Supreme Court, the Delhi government has argued that this interpretation rendered the elected legislature and its council of ministers meaningless with respect to the governance of Delhi. The question then arises: do the Lt. Governor’s executive powers under Article 239AA allow him to overrule the decisions of the Delhi council of ministers that have the support of an elected legislature?

The ‘Westminster’ model of government that our Constitution follows (and I discuss this below), requires the council of ministers to be ‘collectively responsible’ to the elected legislature. To denude the council of ministers from possessing the executive power to govern Delhi would effectively prohibit them from fulfilling their obligation towards the legislature. Thus, the division of executive powers for Delhi must reconcile: (1) the collective responsibility of the Delhi Government towards the legislative assembly of Delhi, with (2) the unique powers granted to the Lt. Governor under Article 239AA.

The debate around executive powers in Delhi is centred around clause 4 of Article 239AA, which states:

Article 239AA (4): There shall be a Council of Ministers consisting of not more than ten per cent. of the total number of members in the Legislative Assembly, with the Chief Minister at the head to aid and advise the Lieutenant Governor in the exercise of his functions in relation to matters with respect to which the Legislative Assembly has power to make laws, except in so far as he is, by or under any law, required to act in his discretion.

Provided that in the case of difference of opinion between the Lieutenant Governor and his Ministers on any matter, the Lieutenant Governor shall refer it to the President for decision and act according to the decision given thereon by the President and pending such decision it shall be competent for the Lieutenant Governor in any case where the matter, in his opinion, is so urgent that it is necessary for him to take immediate action, to take such action or to give such direction in the matter as he deems necessary.

Without jumping to conclusions as to whom has executive supremacy, let us first examine if it is plausible for the Lt. Governor (as the High Court suggested) to have an absolute monopoly on executive power. As executive power flows from legislative power, the conferment of legislative power on the territory of Delhi necessarily implies that the Constitution also confers some executive power. This is evidenced by the existence of a council of ministers, and the ‘Westminster’ model of governance.

The ‘Westminster’ model and collective responsibility

While the ‘Westminster’ model of government may be a slightly nebulous concept towards its fringes, it certainly contemplates two things: a nominal executive through whom executive power is exercised and an executive whose primary function is the formulation and implementation of government policy. Crucially, this latter function is premised on the confidence of the legislative branch in the executive to formulate and implement policy. Thus, in both England and India, the executive is collectively responsible, and thus controlled by the legislature. One could go so far as to say that executive power is permitted because it has the ‘tacit support’ of the majority of the legislature. The accountability of the executive is assessed on a daily basis through debates, questions, and motions on the house floor, including ultimately, votes of no-confidence.

Without getting into the areas of permissible discretion that the President, Governor, and Lt. Governor may have (this is discussed below), a consequence of this collective responsibility is that the executive functions exercised by these functionaries is done on the ‘aid and advice’ of the council of ministers. In Shamsher Singh the supreme court clarified that: because the legislature has the exclusive power to make laws, and because the council of ministers has the support of the legislature, the ‘aid and advice’ of the ministers is legally binding on the nominal executive. For example, under Article 74 the President is bound to act upon the advice of the union council of ministers. While the Governor and the Lt. Governor appear to have been given discretion to act otherwise, the text of Article 163 (‘Council of Ministers to aid and advice Governor’) and Article 239AA (4) (above) also support the understanding in Shamsher Singh precisely by making special note of the discretionary powers. If the Governor and Lt. Governor could disregard the advice of the ministers at any point, there would be no need to couch instances where they can as an exception to a general rule. To put the point another way: the words “except in so far as he is, by or under any law, required to act in his discretion”, which conclude Article 239AA(4), would make no sense if there were areas where the Lt Governor did not have discretion – i.e., where he was bound by the aid and advice of the Concil of Ministers.

Aid and advice and the proviso to cl. 4

The dispute, however, is caused by the proviso that comes immediately after. Specifically, the proviso to Article 239AA(4) authorises the Lt. Governor to differ on “any matter” with the Concil of Ministers, and refer it to the President for decision. Such a power is not given to either the President with respect to the central government, nor to the Governors with respect to the State governments. Thus, the question arises as to whom really has executive power in Delhi, the council of ministers (the Delhi Government) or the Lt. Governor (a Presidential – that is, a Central Government – appointee).

What is needed is a balancing between the collective responsibility owed to the legislative assembly of Delhi, and the special powers given to the Lt. Governor. Firstly, it is apparent that where the legislative assembly doesn’t have legislative powers, the Delhi government (executive) can’t either; in such cases, the Lt. Governor will have absolute executive powers. However, on matters that are intra vires the legislative competence of the legislature, two questions arise: do the Lt. Governor’s discretionary powers allow him to disregard the ‘aid and advice’ of the council of ministers, and does the proviso to cl. 4 of Article 239AA require the Delhi government to secure the Lt. Governor’s approval on all matters?

As noted above, a textual reading of Article 239AA (4) and the principle of collective responsibility support the understanding that ordinarily the Lt. Governor would be bound by the ‘aid and advice’ of council of ministers. The first exception to this is where a statute requires her to exercise discretion. Section 41 of the GNCTD specifically provides a list of situations where the Lt. Governor must exercise her discretion, and is thus not bound by the ‘aid and advice’ of the ministers. Section 41 in facts supports the interpretation above, restricting the discretion of the Lt. Governor to ‘matters outside the legislative competence of the Delhi assembly’, matters that concern the office of the Lt. Governor and its judicial or quasi-judicial functions. Thus, despite the Constitution permitting the Lt. Governor to disregard the ‘aid and advice’ of the council of ministers where provided for by ‘statute’, this does not result in the advice being non-binding in all other instances.

The proviso to cl. 4 of Article 239AA allows the Lt. Governor, in the case of a ‘difference of opinion’ to refer such a dispute to the President. The High Court concluded that the fact that a difference of opinion could exist meant that the ‘aid and advice’ was not binding. This interpretation effectively treats the proviso as the rule and excludes the actual text of cl. 4 proper. As noted above, the use of the words “except in so far as” indicates that the general rule of cl. 4 proper is that the Lt. Governor is bound, and this is supported by the rule of collective responsibility.

However, the proviso clearly envisions a difference of opinion where the Lt. Governor is not bound by the ‘aid and advice’ of the ministers and thus carries out a distinct constitutional function. In interpreting this instance of ‘co-extensive’ executive power it is instructive to examine the administrative relationship between the union and its federal sub-units. Article 256 states that, “The executive power of every State shall be so exercised as to ensure compliance with the laws made by Parliament and any existing laws which apply in that State, and the executive power of the Union shall extend to the giving of such directions to a State as may appear to the Government of India to be necessary for that purpose.” Because the union’s laws apply within federal sub-units as well, the union can require that a sub-unit’s executive powers are used to ensure that union laws are enforced within the sub-unit. Thus, to ensure the smooth function of a federal government, the union executive has an interest with respect to union, or central laws promulgated by parliament.

Applying this understanding to the proviso of Article 239AA (4), where the ‘aid and advice’ of the ministers conflicts with the union’s interest with respect to laws passed by parliament, there would be a ‘difference of opinion’. It should be noted that in the case of Delhi, the union’s interest is far more intricate than in an ordinary State. Parliament has concurrent legislative power with respect to Delhi, and has exclusive power on matters relating to ‘public order’, ‘police’, and ‘land’ (entries 1, 2, and 18). Therefore, for example where the Delhi government attempted to control the police, where parliament has supremacy, the proviso would be applicable.

There also exist extraordinary circumstances where even the President or a Governor would not be bound by the ‘aid and advice’ of the council of ministers. Justice Krishna Iyer pointed out, for example, that where the government had lost the majority of the house but was refusing to quit, the Chief Executive would be obligated to disregard the advice of the ministers. Similarly, in the context of a ‘failure of constitutional machinery’ Governor would arguably be correct to disregard the advice of the ministers, as they might themselves be the reason for the failure. In the case of the President or the Governor, they themselves are the final arbiter as to when such a situation exists by virtue of the high constitutional office that they occupy. The administration of Delhi ultimately vests in the President, and if such extraordinary circumstances were to arise, the Lt. Governor would arguably be obligated to refer the matter to the President under the proviso to Article 239AA (4). Thus, the proviso could be seen as codifying a crucial residuary power of the Lt. Governor to ‘prevent the subversion of democracy’ by a government. As was noted by Justice Chandrachud in hearing the case last week, when the Lt. Governor refers a matter to the President, he not acting as the executive head of Delhi, but rather as an agent of the President. Thus, independent of the union’s interest in enforcing its laws, if a ‘difference of opinion’ of the kind described above arose, the proviso to cl. 4 might be applicable.

The second conclusion reached by the High Court based on the proviso was that to allow the Lt. Governor to refer the matter, no action could be taken unless the Lt. Governor has first approved it. Just like the President with respect to parliament, the Lt. Governor is entitled to send for all decisions passed by the council of ministers. This is clearly intended to operationalise the duty of the Lt. Governor under the proviso, to protect the union’s interests and the Constitution in Delhi. However, the consent of the Lt. Governor prior to implementation of a decision is unnecessary to operationalise the duty in the proviso. It is feasible that the government continues to function, and the Lt. Government notices a particular proposal that is likely to cause controversy, he may attempt to caution the government, and if need be refer the matter under the proviso.

The practice is one that stems from England where the Sovereign has the right to see decisions of the cabinet in order to advise or warn the council of ministers. Jennings’ note on English practice is rather instructive here: “Though George V insisted on seeing leaders of the opposition in 1910, he did so with the Prime Minister’s consent, and sought information, not assistance in defeating the government.” Unlike the English Sovereign, the President and the Lt. Governor both have strong party affiliations. This duty is thus one executed, at least at certain times, in a political atmosphere. Thus, while the Lt. Governor certainly has a right to see all proposals, he would arguably not be permitted to use this right to defeat the functioning of a government. To hold all government proposals ransom to the consent of the Lt. Governor would arguably be defeating the functioning of the government.

Conclusion

Both the council of ministers and the Lt. Governor are indirectly elected but hold the tacit support of a legislature. While the Lt. Governor’s executive power flows from both parliament and Article 239AA, it cannot be used to neutralise the Delhi government. The fact that the council of ministers is collectively responsible to the elected legislature requires that it also be given sufficient executive power to ensure smooth governance. However, the Lt. Governor is not a mere rubber stamp authority, he holds a distinct constitutional office that not only administers Delhi on the issues of public order, police, and land, and ensures the union’s interests within Delhi, but also functions as a crucial check on the powers of the Delhi government.

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Addendum: Contempt and the Supreme Court’s Humpty Dumpty Jurisprudence

At the time of writing yesterday’s post, the final chapter in the story remained to be told. That chapter was completed today when a three-judge bench of the Supreme Court dismissed the writ petition filed by Kamini Jaiswal, which sought an SIT investigation into allegations of judicial corruption.

As in the previous post, I do not want to go into the merits of the petitions themselves, and associated issues of judicial politics (in fact, today’s judgment doesn’t really doesn’t go into the merits of the petitions either). In the previous post, however, I had made one argument: the Chief Justice’s role as the master of the roster, with its attendant power to list matters and select benches, comes into conflict with the principle of nemo iudex (no person shall be a judge in her own cause) in that class of rare cases where the Chief Justice herself is implicated in an illegal act. In such a situation, the Chief Justice ought to be precluded from hearing the case on merits (of course), but also precluded from passing any administrative orders deciding when, and before whom, the case will be listed.

How did the three-judge bench deal with this? In paragraph 19 of its judgment, it noted that:

“As a matter of fact, this controversy has been set at rest that even when there is an allegation against Hon’ble Chief Justice of India, it is he, who has to assign the case to a Bench, as considered appropriate by him.”

The three-judge bench did not, however, provide any independent reasons justifying this position. It relied upon the Constitution Bench order of 10th November (which we discussed in the previous post), and then cited the judgment in D.C. Saxena vs Chief Justice of India. In that case, the Court had noted:

“When imputations were made against the Chief Justice, the petitioner assumed, in our view, “wrongly” that CJI cannot constitute benches nor he should discharge the functions of Chief Justice until the matter is decided. On appointment by the president by a warrant and on his taking oath of office, the CJI becomes entitled to discharge the functions and duties of that office including constitution of benches and assignment of judicial work to judges as per procedure. This responsibility flows from the office and none including a litigant has right to demand for contra position. As regards his personal disposition to hear a case by a bench of which he is a member, it is his own personal volition. The Chief Justice’s prerogative to constitute benches and assignment of judicial business would no hinge at the whim of a litigant.” (para 26)

Notwithstanding the legal correctness of this paragraph, D.C. Saxena was an entirely inapposite case upon which to rely. D.C. Saxena was a PIL petitioner who, after having had a PIL dismissed by the then-Chief Justice, filed a fresh PIL against the Chief Justice, asking that he be removed from office (among other things). The present case, however, involved a registered FIR and a CBI investigation, whose subject matter potentially implicated the Chief Justice. There is a world of difference between the two situations; but in any event, what is far more important is the three-judge bench’s failure to do two things: first, to show that the nemo iudex principle would not apply to the present case; and secondly, to show that there was something in the Constitution, or in any law, according to which the Chief Justice could be exempted from the operation of the principle.

On the first issue, the Bench repeated that the FIR did not name the Chief Justice, or any Supreme Court judge. However, that was nobody’s case; indeed, according to settled law, judges could not be named in FIRs without following a specific procedure. The Chief Justice’s involvement in the case did not stem from his being named in the FIR, but from the fact that the principal accused – a retired judge of the Odisha High Court – had claimed to be able to fix a Supreme Court bench that the Chief Justice was presiding over. Now, once that is established, there are two possibilities: either the principal accused was lying, or he was telling the truth. In the latter eventuality, the Chief Justice was certainly implicated; and the question of whether the principal accused was lying or not could – naturally – only be determined through an investigation (whether by the CBI or the SIT) and, eventually a trial.

Consequently, the naming of the Chief Justice in the FIR is irrelevant to the question of whether nemo iudex applies or not. And if nemo iudex did apply, the three-judge bench simply didn’t have an independent argument (apart from its dubious reliance on D.C. Saxena) as to why the Chief Justice was exempted, and for good reason: there isn’t one. There is nothing in the office or functions of the Chief Justice that justifies any such exemption; and, as I argued in the previous post, the Chief Justice’s role as the master of the roster can easily be taken over by Court No. 2 at a time like this, in the interests of the continued smooth functioning of the institution.

There is a third possibility, however: that the Chief Justice continuing to play his role as the master of the roster would not violate the nemo iudex principle. In the last post, I provided some detailed arguments about the nature of this administrative power, and why it was serious and far-reaching in character. What did the three-judge bench have to say about this? It said this:

“It is contempt to imply that the Chief Justice would assign it to a Bench which would not pass an order adverse to him. It is also contempt to imply that the Judges would be so amenable to comply that the Bench which heard the second writ petition could not have heard it. This Court has laid down these allegations aimed at bringing the administration of justice in disrepute.” (paragraph 22)

This, however, misses the point entirely. It was nobody’s case that the Chief Justice would assign a case to a Bench that would decide in his favour. Nor was it anybody’s case that the bench hearing it would be amenable to deciding in the Chief Justice’s favour. The point – as we discussed in the last post, is this: the structure of the Supreme Court with its multiple benches and its collegial nature, and the very character of judging as a human enterprise, are such that the power to decide who hears a case necessarily implies a measure of control over its outcome. There is no insinuation that the Chief Justice would abuse his power; what is at issue, however, is that the existence of the power necessarily means that in cases of this kind, when the Chief Justice exercises his role as the master of the roster, he acts as a judge in his own cause. He might be the most honest judge that ever lived, but that is not the point; the principle is not that “no person shall be a (dishonest) judge in her own cause”. It is – for excellent reasons – simply that “no person shall be a judge in her own cause.”

By misunderstanding the character and purpose of the nemo iudex principle, the three-judge bench effectively granted the office of the Chief Justice blanket immunity from its operation. The new principle now seems to be “no person (except the Chief Justice of India) shall be a judge in her own cause.”

What follows, however, is substantially worse. One of the three judges hearing the petition – Justice Khanwilkar – had also been on the bench (alongside the Chief Justice) that the principal accused in the FIR had claimed he could “fix”. Justice Khanwilkar’s presence on the bench hearing the petition on merits, therefore, created a conflict of an order of magnitude more serious than the one created by the Chief Justice’s administrative power to list cases; Justice Khanwilkar was exercising judicial power to decide the case. The inevitable implication of this is that not only the Chief Justice – but every judge of the Supreme Court – is exempted from the nemo iudex principle.

What was the Court’s response to this? It was a familiar one.

“Yet another disturbing feature which aggravates the situation is that prayer has been made, that one of us, Justice A. M. Khanwilkar, should recuse from the matter. This is nothing but another attempt of forum hunting which cannot be permitted. Rather this kind of prayer was held to be contemptuous, aggravating the contempt in the case of Dr. D C Saxena (supra).” (paragraph 28)

According to the three-judge bench, therefore:

(a) It was contempt of court to object to the Chief Justice exercising his administrative power to list a case in which he was potentially implicated, and

(b) It was contempt of court to ask Justice Khanwilkar to recuse himself from exercising judicial power in hearing a case in which he was potentially implicated.

It is fairly clear that on this grotesque definition of contempt, both this blog post – and the last one – are in contempt of court. However, this is not the definition of contempt of court in law. The Contempt of Courts Act is clear that there must be an act that “substantially interferes, or tends substantially to interfere with the due course of justice“; and furthermore, there ought to be clear evidence of such interference. In using the word “contempt” no less than twenty-one times in the course of its thirty-eight page order (and, on occasion, mistakenly equating it with “forum shopping”), the three-judge bench’s order is reminiscent of Humpty Dumpty in Alice Through the Looking Glass:

“When I use a word,” Humpty Dumpty said, in rather a scornful tone, “it means just what I choose it to mean—neither more nor less.” “The question is,” said Alice, “whether you can make words mean so many different things.” “The question is,” said Humpty Dumpty, “which is to be master—that’s all.”

At the end of its judgment, the three-judge bench observed that:

“Let the good sense prevail over the legal fraternity and amends be made as lot of uncalled for damage has been made to the great Institution in which public reposes their faith.”

One cannot help wondering whether institutional greatness will truly be nurtured by brandishing the sword of contempt – or whether all that will lead to, in Justice Jackson’s words, will be the “compulsory unification of opinion [that] achieves only the unanimity of the graveyard.”  

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New Blog: Law and Political Economy

For everyone interested in constitutionalism and the rule of law, especially from a critical perspective, the launch of the Law and Political Economy blog should be a matter of great excitement. The founders – David Grewal, Amy Kapczyinski, and Jedediah Purdy – are well-known scholars who bring a range of critical expertise to the field, ranging from international trade law to intellectual property law to political philosophy. I extract the first few paragraphs of the Manifesto here:

This is a time of crises.  Inequality is accelerating, with gains concentrated at the top of the income and wealth distributions.  This trend – interacting with deep racialized and gendered injustice – has had profound implications for our politics, and for the sense of agency, opportunity, and security of all but the narrowest sliver of the global elite. Technology has intensified the sense that we are both interconnected and divided, controlled and out of control.  New ecological disasters unfold each day.  The future of our planet is at stake: we are all at risk, yet unequally so. The rise of right-wing movements and autocrats around the world is threatening democratic institutions and political commitments to equality and openness.  But new movements on the left are also emerging.  They are challenging economic inequality, eroded democracy, the carceral state, and racism, sexism, and other forms of discrimination with a force that was unthinkable just a few years ago.

Law is central to how these crises were created, and will be central to any reckoning with them.  Law conditions race and wealth, social reproduction and environmental destruction.  Law also conditions the political order through which we must respond.

How should legal scholars and lawyers respond to this moment?  We propose a new departure – a new orientation to legal scholarship that helps illuminate how law and legal scholarship facilitated these shifts, and formulates insights and proposals to help combat them.  A new approach of this sort is, we believe, in fact emerging: a coalescing movement of “law and political economy.”

The approach we call law and political economy is rooted in a commitment to a more egalitarian and democratic society.  Scholars working in this vein are seeking to reconnect political conversations about the economic order with questions of dignity, belonging, or “recognition” and to challenge versions of “freedom” or “rights” that ignore or downplay social and economic power.

We pursue these egalitarian and democratic commitments through a set of theoretical premises. Politics and the economy cannot be separated. Politics both creates and shapes the economy. In turn, politics is profoundly shaped by economic relations and economic power.  Attempts to separate the economy from politics make justice harder to pursue in both domains.  As recent events illustrate, market society generates political conflict – conflict that is profoundly racialized and gendered. A politics that can engage this conflict must be attentive to the interplay between the ways the state creates “the market” and the ways market power feeds back into the politics, and between the hierarchies and humiliations of “private” life and the appeal of reactionary political visions.

Law gives shape to the relations between politics and the economy at every point. It is the mediating institution that ties together politics and economics.  Though legal realists and more recent critical scholars of law recognized this long ago, their insights must be revived, and given new meaning in the face of the recent history of legal scholarship.

 

 

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No Man Shall Be a Judge in His Own Cause* (*Conditions Apply)

By now, the recent events that have convulsed the Supreme Court in an unseemly controversy have been discussed threadbare. In this post, I do not intend to talk about the broader issues of judicial politics or institutional credibility. I want to focus on something more specific, drawing from a post I wrote here a few months ago: the manner in which power has been concentrated in the office of the Chief Justice, coupled with the uniquely polyvocal character of the Indian Supreme Court, raises some serious challenges for constitutionalism and the rule of law. The events of the last few days have provided us with textbook examples of these challenges – and now is the time, if there ever was one, to think seriously about them.

In particular, I want to focus on the order passed by the Constitution Bench on November 10th, 2017. This bench was constituted on the basis of a reference from a two-judge bench that same morning. In their order, Justices Sikri and Bhushan had noted that the petitioner’s lawyer had brought to their attention an order passed the day before, in a similar writ petition, referring the matter to a Constitution Bench. Consequently, they were placing the matter before the Chief Justice for “appropriate orders”.

The background was this. Two separate petitions had been filed, asking for an impartial SIT investigation into allegations that a retired judge of the Odisha High Court (among others) had been taking bribes to “fix” a matter that was being heard in the Supreme Court. One of those petitions had been “listed” before the Court of Justices Sikri and Bhushan. The second petition was “mentioned” on Thursday, the 9th of November in Courtroom No. 2, and listed for immediate hearing on the same day at 12 45 PM. During the course of the hearing, Justice Chelameswar noted that the allegations were serious, and referred the matter to be heard by the five senior-most judges of the Supreme Court on Monday, the 13th of November. It was this referral that Justices Sikri and Bhushan took note of when the other (first) petition came up for hearing before them on the 10th.

For those unfamiliar with Supreme Court lingo: a “mentioning” refers to an oral plea by lawyers, normally before the Court sits for its regular hearings, and normally requesting that an urgent case be listed for hearing at short notice. Cases that have not already been assigned to benches are mentioned before the Chief Justice; in the present case, the Chief Justice was sitting in a Constitution Bench hearing the Delhi vs Union of India case, and therefore, as per convention, mentionings  took place in Courtroom No. 2. This was Justice Chelameswar’s court, and this was the context in which the second petition came before him.

After Justices Sikri and Bhushan referred the matter to the Chief Justice on the morning of November 10th, the Chief Justice constituted a bench to hear it that same afternoon. The bench consisted of himself and four other judges. In a short order, that bench effectively annulled the order of reference passed by Justice Chelameswar the day before.

The justification given by the bench was as follows: every Court has two “sides” – the judicial side (that is, hearing and deciding cases), and the administrative side (taking administrative decisions such as listing cases). On the judicial side, the Chief Justice is only “first among equals.” However, on the administrative side, he is the “master of the roster”; that is, “he alone has the prerogative to constitute benches of the Court and allocate cases to the benches so constituted.” Consequently:

“… neither a two-Judge Bench nor a three-Judge Bench can allocate the matter to themselves or direct the composition for constitution of a Bench. To elaborate, there cannot be any direction to the Chief Justice of India as to who shall be sitting on the Bench or who shall take up the matter as that touches the composition of the Bench. We reiterate such an order cannot be passed. It is not countenanced in law and not permissible.”

The Constitution Bench therefore held that “any order contrary” to these principles (i.e., Justice Chelameswar’s order) was not binding on the Chief Justice. Soon afterwards, the Chief Justice himself constituted a three-judge bench to hear the case on merits. The bench – which consisted of three judges who had sat in Friday’s Constitution Bench and signed on to the above order – heard the case today, and have reserved it for judgment tomorrow.

So far, so straightforward. The problem, however, is this: the FIR in question – on the basis of which the CBI enquiry was taking place, and which the petition sought to have replaced by an SIT – implicated the Chief Justice himself. The Chief Justice was not named in the FIR; however, the case that the accused – the retired judge of the Odisha High Court – was claiming to “fix” was being heard by a bench presided over by the Chief Justice. In other words, the principal accused claimed that he could fix a Supreme Court bench on which the Chief Justice was sitting.

Everyone is familiar with the basic legal principle of nemo judex in causa sua, which translates to “no person shall be a judge in his own cause.” It is clear, therefore, that the Chief Justice could not hear the petition on merits. However, unlike any other judge of the Supreme Court, the Chief Justice’s involvement with a petition is not limited to hearing it on merits. As we have seen, the Chief Justice being the “master of the roster” implies both that he decides who should hear it, and when it should be heard. On November 10th, the Chief Justice exercised both those powers respect to a petition on a subject matter that, at least, implicated him.

Contrary to what might appear at first blush, the Chief Justice’s powers on the administrative side are not minor matters. The power to decide when a case will be heard implies a power to delay its hearing (that did not happen in this case). And the power to decide who shall hear a case implies a non-trivial level of control over the outcome. As we have discussed before, the Supreme Court is a poly-vocal Court: twenty-six judges sit in thirteen courtrooms, speaking in different and sometimes contradictory voices. It’s trite to say that outcomes of cases are inevitably influenced by judges’ legal philosophies (I have earlier taken examples of death references being listed before abolitionist of pro-death penalty judges, and labour matters being listed before pro or anti-labour judges). There is nothing wrong or even abnormal about this – every judge has, and should have, a legal philosophy that influences how she decides cases. It is unlikely that anyone still believes in the idea of mechanical jurisprudence, which treats law as a logical syllogism with mathematically correct answers.

But while there is nothing wrong with judges having legal philosophies, we can immediately see how, in the collegial atmosphere of the Supreme Court, where judges know each other well (and indeed, the senior judges having appointed junior ones), the Chief Justice’s power to decide who shall hear a case vests substantial power in that office. Specifically, take the case under discussion: the decision of whether or not to appoint an SIT would depend, to a large extent, upon the activist or conservative proclivities of a judge, their notion of the separation of powers, the sanctity they attach to the Code of Criminal Procedure, and so on.

The above discussion should make it clear that in the present case, there was a clear and direct clash between two principles: the Chief Justice being the “master of the roster” on the administrative side, and “no person shall be a judge in his own cause.” Which one should prevail? The answer, with respect is obvious. As the Constitution Bench itself acknowledges, the “master of the roster” stems from Supreme Court Rules, and conventions. Nemo judex, on the other hand, is one of the most basic and fundamental principles of justice. The Chief Justice is “master of the roster” for instrumental reasons and administrative convenience. But without nemo judex, justice cannot exist.

What, then, is the outcome in a clash like this? The answer is: the rule of seniority. Succession to the Office of the Chief Justice is by virtue of seniority, and the presiding judge in Courtroom No. 2 is the next in line after the Chief Justice. Consequently, when the Chief Justice is precluded from acting as the “master of the roster”, that responsibility must devolve on the presiding judge in Courtroom No. 2.

Looked at this way, Justice Chelameswar’s order on the 9th of November was not procedurally irregular. The Chief Justice having been disqualified by the principle of nemo iudex, it was Courtroom No. 2 that, temporarily, became Courtroom No. 1, and the administrative powers of the Chief Justice vested in his successor. Had Justice Chelameswar’s order been passed by the Chief Justice, it would have been entirely regular; because the Chief Justice was disqualified from dealing with the matter at all, the order in question would have to be treated as an order of an (acting) Chief Justice, and deemed to be regular.

This, I would suggest, is the only way to ensure that the “master of the roster” principle does not turn into an impenetrable shield for whoever it is that occupies the office of the Chief Justice, while she occupies it. The “master of the roster” principle assumes that the incumbent Chief Justice will always be entirely honest and maintain the highest standards of integrity. Of course, that is a reasonable assumption to have; however, institutions are designed not on the basis that the occupants of high office will be honest, but with the objective of ensuring their survival on the rare occasion that an occupant is not honest.

The Constitution Bench’s interpretation of the “master of the roster” principle is unfortunate, because it effectively raises the office of the Chief Justice above the institution of the Supreme Court. It is unfortunate because it places institutional integrity in the hands of one man or one woman. It is unfortunate because it fails to ring-fence a vitally important public institution against the possibility of an implosion. And of course, it is unfortunate because it elevates an administrative rule above one of the most basic and fundamental principles of justice.

For that reason, the order merits swift reconsideration. But it is also an opportunity for all of us to reflect more deeply on the institutional structures that we have – and continue to – accept without demur or dissent.

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Guest Post: Government of Delhi vs Union of India – II: The Legislative Relationship

(This is the second part of a series of guest posts by Vasudev Devadasan, exploring the issues in the ongoing dispute between the government of Delhi and the Union of India, being heard by a Constitution Bench of the Supreme Court.)

The last post on Delhi v Union of India (here) touched upon the unique status of Delhi under Article 239AA. Schedule 1 of the Constitution classifies territories into ‘States’ and ‘Union Territories’, with Delhi falling into the latter category. However, Delhi also has a legislature elected from its territorial constituencies. This post examines how the creation of this legislature impacts the dispute between the Delhi governor and Lt. Governor and whether merely because Delhi is not a full-fledged State, the powers of this legislature can be dismissed. By looking at arguments from a textual and structural reading of the Constitution this post tries to determine if the addition of Article 239AA to the Constitution has modified the legislative and executive supremacy that parliament ordinarily has over union territories.

To broadly summarise the relevant legal provisions:

  • Article 239 provides that all union territories shall be administered by the President acting through an administrator (the Lt. Governor in the case of Delhi).
  • Article 239A allows parliament to create, through statute, a partly or wholly elected body to function as the legislature for union territory, with such a body’s powers being specified by parliament.
  • Article 239AA (2a) and (3a) provides that Delhi shall have a fully elected legislature from its territorial constituencies. This legislature shall have the power to make laws on matters in the State List (List II) and the Concurrent List (List III) except on entries I, 2, and 18, subject to the provisions of the Constitution and as applicable to union territories.
  • Article 239AA (3b) and (3c) notes that the power of the Delhi legislature is not in derogation of parliament’s power to pass laws; and that in the event of a conflict between a law passed by parliament and a law passed by the Delhi legislature, the former shall prevail.

Legislative and Executive Power

Under a parliamentary system of government, executive power is co-extensive with legislative power. This is demonstrated by Article 73 of the Constitution which grants the central government executive power on all matters which parliament is competent to make laws on. However, the proviso to Article 73 notes that the central government will not have executive power on matters which a State government is competent to make laws on. Thus, where a legislature has been granted power to make laws on certain matters, executive power on these matters ordinarily vests itself in this legislature and is exercised by the council of ministers.

Therefore, the question of who enjoys legislative supremacy in Delhi is crucial to understanding whether the Lt. Governor or the council of ministers is the executive head of Delhi. The Delhi High Court in its initial analysis of the constitutional scheme found that the addition of Article 239AA to the Constitution did not make Delhi a State. It did not explain where exactly the legislative power with respect to Delhi arose from, rather jumping straight to the question of whether executive power was vested in the Lt. Governor or the council of ministers. It did however quote extensively from NDMC v State of Punjab where the Court had held that because Delhi was not a state, it was thus governed by Article 246(4), which grants parliament absolute legislative power on any territory that is not a State.

However, the NDMC judgement itself notes that “all Union Territories do not have the same status.” The Constitution creates three distinct types of union territories: (1) a union territory without a legislature, (2) a union territory where parliament has created a legislature by statute, and (3) a union territory where the Constitution has created a legislature (Delhi). In fact, the Constitution is rife with examples of such ‘asymmetric federalism’, where federal sub-units are treated differently from each other. Article 371 contains special provisions for multiple States, territories in the northeast have ‘autonomy arrangements’, and of course Jammu and Kashmir has a unique status.

Therefore, to argue that merely because Delhi is not a State, parliament has plenary power is insufficient, especially where the Constitution itself provides a special provision (Article 239AA) for the territory.

The argument from the text

A textual argument is not the literal meaning of the words, but rather an argument that relies solely on the text of the provision in question and the present understanding of those words. In answering the question of legislative supremacy the Court in NDMC acknowledged that Article 239AA (3a) sets up a competent legislature, but then concluded that clauses (3b) and (3c) clearly demonstrated that parliament still retained plenary legislative powers over Delhi. Recall that 239AA(3b) states that:

Nothing in sub-clause (a) shall derogate from the powers of Parliament under this constitution to make laws  with respect to any matter for a Union Territory or any part thereof.

And 3(c) provides that:

If any provision of a law made by the Legislative Assembly with respect to any matter is repugnant to any provision of a law made by Parliament with respect to that matter, whether passed before or after the law made by the Legislative Assembly, or of an earlier law, other than a law made by the Legislative Assembly, then, in either case, the law made by Parliament, or , as the case may be, such earlier law, shall prevail and the law made by the Legislative Assembly shall, to the extent of the repugnancy, be void.

As noted above, the Constitution contemplates three distinct types of union territories as seen from the text of Articles 239, 239A, and 239AA. The first type of union territory has no legislature and parliament plus the administrator (appointed by the President) are clearly the relevant bodies to govern such a territory. The second type of union territory is union territory is where parliament, through a statute, creates a legislature that is either elected or partly elected and specifies its powers (such as Puducherry). There are unlikely to be any allocation issues arising out of an arrangement because parliament has the power to create an arrangement suitable to it, and modify the arrangement at will. Thus, indirectly, parliament retains legislative supremacy.

The last type of union territory is that where the Constitution itself has created a wholly elected legislature. While the consequences of incorporating a provision in the Constitution are open for debate, two points come to mind. Firstly, incorporation into the constitution can signal a level of permanency, or a ‘pre-commitment’ to an idea. Even in a Constitution that is amended as often as ours, the incorporation of the Delhi legislature in Article 239AA indicates that both the existence and content of the Delhi legislature is not something the Constitution leaves to the whims of a simple majority in parliament. Otherwise Article 239A would have been sufficient. Secondly, by incorporating the Delhi legislature in the Constitution, the source of the legislature’s power is the Constitution, just like parliament or a State legislature. Thus, it is a distinct constitutional institution whose powers and relationship with parliament are governed by the provisions and norms of the Constitution. In the case of an ordinary union territory, the powers of parliament may truly be plenary, however in the case of Delhi, they would be regulated by Article 239AA. For example, if parliament were to pass a law that nominated members onto the Delhi legislature, such a statute would be ultra vires the Constitution as Article 239AA (2a) requires seats in the assembly to be filled by direct election from the constituencies of Delhi.

Coming to the question of legislative powers in governing Delhi, Article 239(3a) grants the legislative assembly of Delhi competence to pass laws on matters in List II and III. However, unlike Article 246(3) which grants a State legislature “exclusive power to make laws for such State”, Article 239AA (3a) makes no mention of exclusivity. Additionally, Clause 3b on the other hand note that this power is not in derogation of the powers parliament has over union territories. Thus, Article 239AA seems to vest legislative power in both the Delhi legislature and parliament.

The argument from structure

A structural argument doesn’t rely on the text of a specific provision. It examines the existence and position of various provisions across the entire Constitution to determine the institutional arrangements that the document contemplates and applies them to specific situations. Philip Bobbitt in explaining the structural argument cites the 1868 American case of Crandall v Nevada where a tax was imposed on individuals leaving one State and travelling to a new one. The argument goes that firstly, elected representatives needed to leave their State and travel to Washington D.C., and secondly ordinary citizens needed to do the same if they wished to approach the seat of government and plead their cause. Thus, the relationship between individuals and their elected representatives, and the national government and the State governments prohibited a tax on leaving the State. In India an often-cited example of structural reading is how the Supreme Court uses the existence various provisions to determine the ‘basic structure’ of the Constitution.

While Delhi is strictly classified a ‘Union Territory’ under the Constitution, it is important to note that the relationship between the people of Delhi and parliament is markedly different from that of other union territories. As has been noted (here), when residents of an ordinary union territory votes in national elections, they are also in effect voting for their local government. However, when the residents of Delhi votes in national elections, they are not voting for their local government. The residents of Delhi choose their local government during the Delhi legislative assembly elections (which are also administered by the Election Commission of India) in the same manner that residents of any States choose their local government.

This is not to suggest that Delhi is more akin to a State. Rather, that where the Constitution creates an elected legislature and a council of ministers, and gives them competence on certain matters, it envisages a relationship where such a legislature is empowered to fulfil the demands of the electorate. Therefore, the relationship between the electorate and an elected legislature would favour an outcome where the legislative assembly of Delhi had sufficient legislative powers to fulfil the mandate of the electorate.

However, as even Bobbit notes, structural arguments often seem indeterminate because, “while we can all agree on the presence of various structures, we fall to bickering when called upon to decide whether a particular result is necessarily inferred from their relationships.”

Conclusion

In the NDMC v State of Punjab decision, the court concluded that, “Delhi is in a class by itself but is certainly not a State within the meaning of Article 246 or Part VI of the Constitution. In sum, it is also a territory governed by clause (4) of Article 246.” To the Delhi High Court’s credit, it acknowledged that Delhi would be governed Article 239AA. However, it did not explore the consequences of Delhi not being governed by Article 246(4), nor the distinction between legislature created by statute and one created by the Constitution. Article 239AA creates a delicate power sharing arrangement with respect to legislative power that is likely better understood in practice than from the text of the Constitution.

We noted above that executive power flows from legislative power. Therefore, understanding that both parliament and the Delhi legislature have concurrent legislative power is an important step in understanding where executive power is vested. Clearly it is not an open-shut case of parliament having plenary powers and thus the Lt. Governor being the sole executive head, as might have been the case with an ordinary union territory. To understand the impact of this concurrent legislative power on executive power is the next step.

While a decision of the Supreme Court will certainly provide a definitive answer as to how Delhi is to be governed, it is worth questioning the value in this. Often the Constitution, unable to secure political consensus, creates a set of constitutive rules that enables deliberation on the matter in the future. Thus, Article 239AA could be seen as setting out the de-minimis rules which, while leaving the question of ultimate legislative and executive supremacy unanswered, create a framework of deliberation through which the question can be answered on an ongoing basis through the constitutional practice of the relevant actors. Article 239AA may tell us only so much about how Delhi is to be governed, but the political fact that Delhi has been governed under the provision through deliberation and disagreement for over two decades without a Supreme Court verdict is to be noted.

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