Basheshar Nath vs Commissioner of Income Tax, Delhi and Rajasthan and Another

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No.208 of 1958

Decision Date: 19 November 1958

Coram: Natwarlal H. Bhagwati, S.K. Das, J.L. Kapur

In the matter titled Basheshar Nath versus The Commissioner of Income‑Tax, Delhi and Rajasthan and another, the Supreme Court rendered its judgment on 19 November 1958. The bench that heard the appeal comprised Justice Natwarlal H. Bhagwati, Justice S. K. Das and Justice J. L. Kapur. The citation of the decision is reported in 1959 AIR 149, 1959 S.C.R. Supplement (1) 528, and it has been referenced subsequently in a number of reported cases, including R 1960 S.C. 1080, E&R 1960 S.C. 1125, R 1961 S.C. 1457, RF 1962 S.C. 92, MV 1966 S.C. 1089, RF 1967 S.C. 1643, E 1970 S.C. 898, RF 1973 S.C. 1461, RF 1975 S.C. 1121, RF 1975 S.C. 2299, R 1976 S.C. 1207, RF 1977 S.C. 1496, RF 1979 S.C. 25, RF 1980 S.C. 1362, RF 1981 S.C. 679, R 1986 S.C. 180, D 1987 S.C. 925, RF 1990 S.C. 1480, and C 1991 S.C. 101. The principal statutory provisions involved were Section 8A of the Taxation of Income (Investigation Commission) Act, 1947 (30 of 1947), and Article 14 of the Constitution of India.

The appeal presented two principal questions for determination. The first question concerned whether a settlement made under Section 8A of the Investigation Commission Act, 1947 after the commencement of the Constitution was constitutionally valid. The second question examined whether a waiver of a fundamental right could be permissible under the Constitution. The factual background disclosed that the appellant’s case was referred to the Investigation Commission on 22 July 1948 by the Central Government pursuant to Section 5(1) of the Act. The Commission, exercising the power conferred by Section 6 of the Act, directed an authorised official to examine the appellant’s accounts. The official submitted his final report at the end of 1953. After hearing the assessee, the Commission concluded that an amount of Rs 4,47,915 had escaped assessment.

Subsequently, on 20 May 1954, the appellant applied to the Commission for a settlement under Section 8A, offering to pay Rs 3,50,000 as tax and penalty at the concessional rate. The Commission reported its approval of the settlement to the Central Government, which accepted the report and recorded the settlement. Thereafter, under Section 8A(2) of the Act, the Central Government directed that the agreed amount be recovered. The appellant was authorized to make the payment in monthly instalments of Rs 5,000, and by 8 September 1957 he had paid a total of Rs 1,28,000. During the pendency of these payments, the Income‑Tax Officer issued a certificate and attached certain properties of the appellant.

The appellant later challenged the validity of the settlement, relying on the Supreme Court’s earlier decisions in Suraj Mall Mohta and Co. v. A. V. Visvanatha Sastri, [1955] 1 S.C.R. 448 and M.Ct. Muthiah v. The Commissioner of Income‑Tax, Madras, [1955] 2 S.C.R. 1247. He argued that the provision of Section 5(1) on which the settlement was based had been declared void, and he sought the release of the attached properties and a refund of the amount paid under the settlement.

The appellant filed a petition with the Commissioner of Income‑Tax contesting the legality of the settlement that had been entered into under section 8A of the Income‑Tax Act. The appellant argued that the settlement rested on section 5(1) of the Act, which this Court had previously declared void, and therefore sought release of his attached properties and a refund of the amount he had paid under the settlement. On 29 January 1958, the Commissioner of Income‑Tax replied to the appellant, asserting that the settlement remained valid, that the appellant was obligated to discharge the outstanding instalments, and that he should continue making future payments. Dissatisfied with the Commissioner’s response, the appellant applied to the Supreme Court for special leave to challenge the decision. The respondent contended that the statute prescribed two separate and distinct procedures – one for investigation and another for settlement – and that only the investigative procedure had been affected by the Court’s earlier decisions, not the settlement procedure. Additionally, the respondent claimed that by voluntarily entering into the settlement, the appellant had waived his fundamental right guaranteed by Article 14 of the Constitution. The Court, delivering a per curiam judgment, rejected both of these contentions. It held that it was incorrect to assert that the Taxation of Income (Investigation Commission) Act, 1947, established two different procedures, one under section 8(2) for investigation and assessment and another under section 8A for settlement and assessment, and that the decision in M. Ct. Muthiah v. Commissioner of Income‑Tax, Madras, which declared section 5(1) discriminatory and void, applied only to the former procedure. The Court clarified that the Act provided a single procedure, and that when the Commission entertained a settlement proposal it exercised the same jurisdiction, powers, and followed the same procedure as laid down in sections 5, 6 and 7 of the Act. Consequently, the settlement in the present case was not an exception to this rule, fell within the scope of the earlier decision, and therefore violated Article 14 of the Constitution. The Court applied the ruling in M. Ct. Muthiah v. Commissioner of Income‑Tax, Madras, [1955] 2 S.C.R. 1247. It further observed that the majority judgment in Syed Qasim Razvi v. State of Hyderabad, [1953] S.C.R. 589, was limited to the specific facts of that case and could not be extended to the present facts; consequently, that decision was held inapplicable. In the view of Justice Das, Chief Justice, and Justice Kapur, there could be no waiver of the fundamental right protected by Article 14, and it was erroneous to argue that the appellant, by entering into the settlement under section 8A, had relinquished that constitutional right. Article 14 was founded

In this case the Court noted that the rule prohibiting the waiver of a fundamental right was based on a sound public policy that is recognised and valued throughout the civilized world, that the provision was expressed in the language of command and that it created an obligation on the State which no person could, by any act or conduct, relieve. Because deciding whether any other fundamental right could be waived was not strictly necessary for the disposal of the present controversy, the Court declined to consider that question. The Court distinguished the decisions in Laxamanappa Hanumantappa Jamkhandi v. The Union of India, [1955] 1 SCR 769; Dewan‑Bahadur Seth Gopal Das Mohanty v. The Union of India, [1955] 1 SCR 773; Baburao Narayanrao Sanas v. The Union of India, [1954] 26 ITR 725; Subedar v. State, AIR 1957 All 396; and Pakhar Singh v. The State, AIR 1958 Punj 294, and held those cases inapplicable. The Court then recorded the view of Bhagwati and Gubba Rao, JJ., that there could be no waiver not only of the fundamental right enshrined in Article 14 but also of any other fundamental right guaranteed by Part III of the Constitution. It was observed that the Constitution makes no distinction between rights enacted for the benefit of the individual and those enacted in the public interest or on the basis of public policy, and therefore there could be no justification for importing foreign doctrines to diminish the transcendental character of those rights, which are conceived in the public interest and are subject only to limitations that the Constitution itself may impose. The Court explained that Article 13(2) operates as a constitutional mandate upon the State with respect to all fundamental rights in Part III, and that no citizen, by waiving any one of them, could relieve the State of the solemn obligation imposed by that article. The view expressed by Mahajan, C.J., in Behram Khurshed Pesikaka v. The State of Bombay, [1955] 1 SCR 613, was affirmed as correctly laying down the law on this point. Since the arguments presented in the instant case had covered the entire field of fundamental rights, the Court found no reason to limit the answer to Article 14 alone and referred to Behram Khurshed Pesikaka v. The State of Bombay, [1955] 1 SCR 613; State of Travancore‑Cochin v. The Bombay Co., Ltd., [1954] SCR 1112; and The State of Bombay v. R. M. D. Chamarbaugwala, [1957] SCR 874. Finally, Justice S. K. Das observed that Article 13 itself recognises a distinction between the absence of legislative power, which renders a law made by an incompetent legislature wholly void, and the exercise of legislative power in contravention of a restriction, which renders the law void only to the extent of the inconsistency. Accordingly, the mere use of the word “void” in Article 13 does not necessarily preclude the application of the doctrine of waiver to the provisions contained in Part III of the Constitution, as considered in Behram Khurshed Pesikaka v. The State of Bombay, [1955] 1 SCR 613, and in Bhikaji Narain Dhakyas v. The State of Madhya Pradesh, [1955] 2 SCR 589.

The Court referred to the decisions in M. Ct. Muthiah v. The Commissioner of Income‑tax, Madras, [1955] 2 S.C.R. 1247; The State of Bombay v. R. M. D. Chamarbaugwala, [1957] S.C.R. 874; Keshavan Madhava Menon v. The State of Bombay, [1951] S.C.R. 228; Behram Khurshed Pesihaka v. State of Bombay, [1955] 1 S.C.R. 613; and Bhikaji Narain Dhakras v. State of Madhya Pradesh, [1955] 2 S.C.R. 589. It observed that nothing in the preamble of either the Indian Constitution or the American Constitution prevented the doctrine of waiver from applying to both. Since the doctrine of waiver had been recognised with respect to rights under the American Constitution, the Court found no reason to exclude it from fundamental rights under the Indian Constitution. However, the Court cautioned that there was no absolute or abstract rule governing the applicability of waiver to fundamental rights. The applicability depended on two factors: first, the nature of the fundamental right to which waiver was sought; and second, the basis on which the plea was raised. The true test, the Court held, was whether the right primarily benefited an individual or the general public. Where the Constitution vested a right in an individual, intending chiefly to benefit that person and the right did not encroach on the rights of others, a waiver could be permissible provided it was not prohibited by law, public policy, or public morals. In the present case, the respondents who raised the waiver plea failed to establish the facts necessary to sustain the plea, and consequently the waiver argument failed.

Per Justice Subba Rao, the question of whether a fundamental right could be waived was distinct from the issue of the validity of section 5(1) of the Taxation of Income (Investigation Commission) Act, 1947. That provision had been declared void by this Court in M. Ct. Muthiah v. The Commissioner of Income‑tax, Madras because it violated the fundamental right guaranteed under Article 14 of the Constitution. The decision, being binding on all courts in India, meant that the Commissioner of Income‑tax lacked jurisdiction to continue proceedings against the appellant under the void provision, and the appellant could not, by waiving his right, confer jurisdiction on the Commissioner. The Court further held that Article 13(1) of the Constitution made no distinction between a statute voided for being beyond the competence of the legislature and a statute voided for being inconsistent with a constitutional limitation; any statute declared void on either ground remained void for as long as the inconsistency persisted. Since section 5(1) continued to be inconsistent with Article 14, it remained void. The judgment concluded with the civil appellate jurisdiction for Civil Appeal No. 208 of 1958, which was an appeal by special leave from the order dated 29 January 1958 of the Commissioner of Income‑tax, Delhi & Rajasthan, New Delhi, under section 8A(2) of the Act.

In this proceeding, the respondents were represented by Harnam Singh and Sadhu Singh on behalf of the appellant, while the Government of India was represented by M. C. Setalvad, Attorney‑General for India, C. K. Daphtary, Solicitor‑General of India, and B. Sen together with R. H. Dhebar for the respondents. The interveners were represented by A. C. Mitra and B. P. Maheshwari. The judgment was dated 19 November 1958. The judgment of the Chief Justice, Das, and Justice Kapur was delivered by Chief Justice Das. In addition, Justices Bhagwati, S. K. Das and Subba Rao delivered separate judgments on the matters before the Court.

Chief Justice Das noted that the appeal, which was entertained by way of a special leave, had been filed by one Shri Besheshar Nath, who was referred to in the judgment as “the assessee.” The appeal challenged the validity of a settlement that had been effected under section 8A of the Taxation on Income (Investigation Commission) Act, 1947 (Act 30 of 1947), the statute that the Court subsequently called “the Investigation Act.” The Investigation Act had been brought into force on 1 May 1947 by a notification issued by the Central Government under sub‑section (1) (3) of that Act. The Court observed that the Act, although short‑lived, had experienced a “chequered career,” a description that would become clear from the facts later set out in the judgment. In order to address the several questions that the parties raised, the Court found it necessary to refer to the substantive provisions of the impugned Act.

Section 3 of the Investigation Act authorised the Central Government to constitute an Income Tax Investigation Commission, hereinafter referred to as “the Commission.” That section also prescribed the duties that were to be discharged by the Commission. The first duty required the Commission to investigate and to report to the Central Government on all matters relating to income taxation, with particular reference to the extent to which the existing law and the procedures for assessment and collection of tax were adequate to prevent tax evasion. The second duty required the Commission, in accordance with the provisions of the Act, to investigate any case or any points in a case that were referred to it under section 5, and to make a report—whether a final report or an interim report, as the Commission deemed appropriate—to the Central Government concerning the assessments that had been made in relation to the case up to the date of such report. The Court indicated that section 4, which dealt with the composition of the Commission, could be omitted from the present discussion because it was not essential to the issues under consideration.

The Court then turned to section 5, which it described as the provision of “importance” for the matters before it. Sub‑section (1) of section 5 empowered the Central Government, at any time before 30 June 1948, to refer to the Commission any case or points in a case in which the Government had prima facie reasons to believe that a person had substantially evaded income tax, together with any material that supported such belief. The same sub‑section also allowed the Government, before the said deadline, to apply to the Commission for the withdrawal of any case or points that had been referred. If the Commission approved such a withdrawal, the Court noted, no further proceedings could be taken by or before the Commission with respect to the withdrawn case or points. Sub‑section (2) provided that, after examining the material submitted by the Central Government in reference to any case or points and after conducting an investigation as it considered necessary, the Commission could report to the Central Government that further investigation was unlikely to reveal any substantial evasion, and that the investigation would then be deemed closed. The Court’s exposition of these provisions set the stage for the consideration of the specific settlement that was the subject of the present appeal.

In this provision, the Central Government, after referring any case or particular points therein and after conducting such investigations as it deems necessary, may communicate to itself that, in its opinion, further inquiry is unlikely to reveal any substantial evasion of income tax. Once such a declaration is made, the investigation is deemed to be closed. The provision further stipulates that no reference made by the Central Government under sub‑section (1) at any time before the 30th day of June 1948 may be called into question, and no Court shall examine the adequacy of the material on which that reference was based. Moreover, if, during the investigation of any case or points referred under sub‑section (1), the Commission acquires reason to believe that either (a) a person other than the one whose case is under investigation has evaded income tax, or (b) additional points beyond those initially referred require investigation, the Commission may report its reasons to the Central Government. Upon receipt of such a report, the Central Government is obliged, notwithstanding anything in sub‑section (1), to immediately refer the other person or the additional points indicated for investigation by the Commission. The date “30th day of June, 1948” appearing in sub‑sections (1) and (3) was later amended by Act 49 of 1948, which replaced it with the words “1st day of September, 1948”.

Section 6 of the Act enumerated the various powers conferred on the Commission, while section 7 prescribed the procedure to be followed by the Commission. Although it is unnecessary to reproduce the full description of those powers and procedures, the Court noted that they have been examined and characterized as considerably more drastic and harsher than the powers exercised by income‑tax authorities under the Indian Income Tax Act, 1922. The relevant portions of section 8 are as follows: First, except as otherwise provided in the Act, the material placed on record shall be considered by all three members of the Commission sitting together, and the Commission’s report shall reflect the opinion of the majority of the members. Second, after reviewing the report, the Central Government shall, by a written order, direct any proceedings it deems appropriate under the Indian Income Tax Act, 1922, the Excess Profits Tax Act, 1940, or any other law against the person to whose case the report relates, concerning income for any period commencing after 31st December 1938. Upon such a direction, those proceedings may be initiated and completed under the appropriate law notwithstanding the restrictions contained in section 34 of the Indian Income Tax Act, 1922.

In accordance with the Indian Income Tax Act, 1922, or section 15 of the Excess Profits Tax Act, 1940, or any other law, the provisions applied even if there had been any lapse of time or any contrary decision issued by any income‑tax authority or by the Income Tax Appellate Tribunal. The statute further provided that, in all assessment or reassessment proceedings taken pursuant to a direction issued under sub‑section (2), the findings recorded by the Commission on the case or on the specific points referred to it were to be final, subject to the provisions of sub‑sections (5) and (6). However, those proceedings could not prevent the initiation of separate proceedings under section 34 of the Indian Income Tax Act, 1922. The Act also stipulated that, notwithstanding any provision to the contrary in this Act or any other law then in force, any evidence admitted before the Commission or an authorised official would be admissible as evidence in any proceedings directed to be taken under sub‑section (2). Section 9 of the Act expressly barred the jurisdiction of courts from questioning any act or proceeding of the Commission or of any authorised official appointed under section 6. Section 10 empowered the Central Government to make rules through a notification published in the official gazette. On 22 July 1948, the case of the assessee was formally referred to the Commission by a communication from the Ministry of Finance (Revenue Division), New Delhi, which stated that, under section 5(1) of the Taxation on Income (Investigation Commission) Act, 1947, the persons named were referred for investigation because the Central Government had prima facie reasons to believe that each of them, either individually or in conjunction with others, had evaded payment of tax on income to a substantial extent; the material supporting that belief accompanied the order. The order listed EP 829/1 Beshashar Nath and Co. and EP 829/2 Lala Beshashar Nath, and it was signed by Pyare Lal, Deputy Secretary of the Ministry of Finance (Revenue Division), and by the Secretary of the Income‑Tax Investigation Commission, New Delhi. It was not necessary to reproduce the annexures that accompanied that order. The records indicated that the total‑wealth statement of the assessee was filed on 10 November 1948 and was subsequently forwarded to the authorised official. Further, it appeared that between 8 January 1949 and 14 October 1949 the authorised official was engaged in collecting assessment records of the assessee from the territorial income‑tax offices and in obtaining materials from the Civil Supplies Directorate concerning the assessee. During this period, by amendment a.33 of Act 67 of 1949, a new provision, section 8A, was inserted into the Act, providing for the settlement of cases under investigation. Section 8A stated that where any person involved in a case referred to or pending before the Commission applied to have the case or any part of it settled insofar as it related to him, the Commission could consider the application and, if it deemed the terms of settlement acceptable, refer the matter to the Central Government for approval.

The Commission was required, according to the provision, to evaluate an application for settlement and, if it considered the terms of the settlement acceptable, to forward the matter to the Central Government. If the Central Government then accepted those terms, the Commission had to record the settlement. Upon recording, the investigation would be deemed closed with respect to any issues that were covered by the settlement. The provision further stated that, for the purpose of enforcing any settlement reached under sub‑section (1), the Central Government could order that appropriate proceedings be taken under the Indian Income‑tax Act, 1922, the Excess Profits Tax Act, 1940, or any other applicable law. In particular, the provision specified that certain provisions—namely, the second proviso to clause (a) of sub‑section (5) of section 23, section 24B, the proviso to sub‑section 2 of section 25A, the proviso to sub‑section 2 of section 26, and sections 44 and 46 of the Indian Income‑tax Act, 1922—could be applied by the Income Tax Officer having jurisdiction to recover any sum specified in the settlement as if it were income‑tax or arrears of income‑tax within the meaning of those provisions.

The third sub‑section of the same section provided that, subject to the provisions of sub‑section (6) of section 8, any settlement arrived at under this section would be conclusive as to the matters stated therein. Accordingly, no person whose case had been settled in this manner could reopen the matter in any proceeding for the recovery of any sum under this section, nor could the matter be reopened in any subsequent assessment or reassessment proceeding relating to income‑tax, or in any other proceeding before any Court or other authority, insofar as the issue formed part of the settlement. The fourth sub‑section clarified that, where a settlement had been accepted by the Government under sub‑section (1), no proceedings under section 34 of the Indian Income‑tax Act, 1922, or under section 15 of the Excess Profits Tax Act, 1940, could be initiated with respect to the items of income covered by the settlement, unless the settlement itself expressly permitted the initiation of such proceedings.

The factual chronology continued with the receipt of the total wealth statement on 5 July 1949, when it was returned from the authorised official. The Constitution of India later came into force on 26 January 1950. The order‑sheet indicated that on 26 May 1950 the authorised official issued a notice fixing a hearing for 10 June 1950, showing that the official was proceeding with the investigation that had been referred to the Commission. The assessee attended on 6 June 1950 and submitted an application for an extension of time, which was granted. Subsequently, on 30 September 1950 the assessee supplied certain statements of his firm. An entry in the order‑sheet recorded, against the date 31 October 1950, that the assessee requested a further extension of time.

The assessee applied for an additional extension of time, after which a lapse of approximately three years followed during which no further action appeared to be taken. On 9 June 1953 the authorised official finally scheduled a hearing for 15 June 1953, and on the same day submitted an interim report to the Commission. Subsequent examinations of the assessee were conducted on 9, 10 and 13 October 1953, after which the authorised official filed his final report on 19 October 1953. A notice dated 30 January 1954 directed the assessee to appear before the Commission on 15 February 1954. In preparation for that hearing, on 5 February 1954 the assessee requested that the Commission permit inspection of certain assessment orders relating to his case, return his lease deed that he had filed, provide a copy of the statement of one L Kalidas, and produce several other documents before the Commission. The hearing originally set for 15 February 1954 was subsequently adjourned to 4 March 1954. During the adjourned hearing, witness Kalidas was examined on 4 March 1954. On 29 March 1954 the assessee further sought a copy of the deposition given by another witness, Durgadas, before the Commission. After the evidentiary stage concluded, a notice issued on 1 May 1954 commanded the assessee to appear again before the Commission on 19 May 1954. The assessee complied on that date; the parties presented their arguments and the Commission reserved its orders. Counsel for the assessee later explained that, at the close of the arguments on 19 May 1954, the Commission announced that income, profits and gains which had escaped assessment in the period from 1 April 1939 to 31 March 1947 amounted to a total of Rs 4,47,915. The Commission further indicated that, should the assessee accept this determination, he would be eligible for a settlement on a concessional basis involving payment of seventy‑five percent of the assessed amount together with a modest penalty of Rs 14,064, rather than being compelled to pursue a less favourable settlement under section 8A by paying Rs 3,50,000 as tax and penalty. The chronology described is corroborated by paragraphs three and four of the settlement application filed by the assessee on 20 May 1954, a copy of which the respondents have produced before this Court. On 24 May 1954 the Commission submitted a report under section 8A(1) to the Central Government, expressing the opinion that the settlement terms set out in the application were suitable for approval. The Central Government accepted the proposed settlement, and the Commission recorded the agreed terms. Subsequently, the Central Government issued Order C No 74 (9‑IT) 54 on 5 July 1954, invoking section 8A(2) of the Investigation Act, and directed that a demand notice reflecting the settlement terms be served without delay by the Income Tax Officer, and that any other proceedings under the Indian Income Tax Act or related statutes be taken as necessary to enforce payment of the full sum of Rs 3,50,000.

The Commission was instructed to employ any legal measures deemed necessary to secure payment of the demand and to issue a single demand for the full amount of Rs 3,50,000. Despite this directive, the assessing officer permitted the assessee to satisfy the liability by making monthly instalments of Rs 5,000. While these arrangements were being carried out, on 28 May 1954 the Supreme Court delivered its judgment in Suraj Mall Mohta and Co. v. A. V. Visvanatha Sastri. In that matter, the investigation concerned the affairs of Messrs. Jute and Gunny Brokers Ltd., which had been referred to the Commission under section 5(1) of the Investigation Act. During the inquiry the Commission alleged that Suraj Mall Mohta and Co. had earned substantial profits which they had failed to disclose, thereby evading tax. Accordingly, the Commission reported its findings to the Central Government on 28 August 1953 under section 5(4) of the Investigation Act. The Central Government, on 9 September 1953, referred the case back to the Commission under the same provision. On 15 September 1953 the Commission issued a notice to Suraj Mall Mohta and Co., informing them that their case had been referred for investigation and requiring them to furnish certain documents and details enumerated in the annexure to the petition. The company responded on 12 April 1954 by filing a petition under Article 32 of the Constitution, seeking a writ to restrain the Commission from taking any further action on the ground that the provisions of the Investigation Act were void for being discriminatory. The Supreme Court, in that judgment, held that both section 34 of the Indian Income Tax Act, 1922 (as then enacted) and sub‑section (4) of section 5 of the Investigation Act covered persons who had similarly failed to disclose their income and had evaded tax. However, the Court observed that the procedure prescribed by the Investigation Act was substantially more prejudicial than the procedure provided under the Income Tax Act. Consequently, sub‑section (4) of section 5 and the associated procedure of the Investigation Act were declared discriminatory, violative of Article 14 of the Constitution, and therefore void and unenforceable. Following the declaration of voidness of sub‑section (4) of section 5, Parliament enacted the Indian Income Tax Amendment Act (33 of 1954), which amended section 34 of the Indian Income Tax Act, 1922. Paradoxically, the amendment brought within the ambit of the amended section 34 those persons who had previously fallen solely under section 5(1) of the Investigation Act and constituted a distinct class of substantial tax evaders. Thus, after the amendment, the Income

Tax officers were able to select certain individuals and refer their matters to the provisions of section 5(1) of the Investigation Act, thereby subjecting those individuals to the severe and rigid procedure prescribed by that Act. At the same time, the officers could handle other individuals who were similarly positioned under the amended section 34 of the Indian Income Tax Act, 1922, by applying the comparatively more advantageous procedure laid down in that Income Tax Act. Consequently, several writ applications were promptly filed under article 32 of the Constitution alleging that, after the amendment of section 34 of the Indian Income Tax Act, the operation of section 5(1) of the Investigation Act had become discriminatory. The claim was that persons falling within the scope of section 5(1) could be pursued through the harsh, prejudicial, and drastic procedure of the Investigation Act, whereas other persons who belonged to the same class could, at the discretion of the Income Tax authorities, be proceeded against under the more favourable procedure provided by the Indian Income Tax Act. All of those constitutional applications were disposed of in a single judgment reported as Shree Meenakshi Mills Ltd. v. Sri A. V. Visvanatha Sastri. In that decision, the Court held that the amendment of section 34 of the Income Tax Act by the Indian Income Tax Amendment Act, 1954 (Act 33 of 1954), operated in the same field as section 5(1) of the Investigation Act. Accordingly, section 5(1) was declared void and unenforceable because the procedure it imposed on the persons concerned had become discriminatory in character. It is important to note that none of the petitions considered in that judgment involved an assessment that had actually been made under the Investigation Act; the Court merely prohibited any further proceedings before the Commission established under that Act. The present appellant‑assesse, who had entered into a settlement under section 8 of the Investigation Act and had been assessed in accordance with the settlement terms, continued to discharge the tax liability by paying monthly instalments of Rs 5,000 as before. Subsequently, on 20 December 1955, the Court delivered its decision in M. C. T. Muthiah v. Commissioner of Income Tax, Madras. In that case, the Central Government had, under section 5(1) of the Investigation Act, referred the matter to the Income Tax Commission. After conducting an enquiry, the Commission recorded its findings and determined that an aggregate sum of Rs 10,07,322‑4‑3 represented undisclosed income for the period under investigation. The Commission submitted its report to the Central Government, which, acting under section 8(2) of the Investigation Act, directed that appropriate action be taken against the assessee to assess or reassess the income that had escaped assessment for the years 1940‑41 through 1948‑49. Following that direction, the Income Tax Officer issued notices and effected reassessments for the years 1940‑41, 1941‑42 and the period from 1943‑44 to 1948‑49, relying upon the findings of the Commission.

It was held that the assessment orders issued on the basis of the Commission’s findings were to be treated as final and conclusive, and those orders were duly served on the assessee. However, no re‑assessment order was issued for the assessment year 1942‑43. In response to the assessment orders that had been served, the assessee applied to the Commissioner of Income Tax under section 8(5) of the Investigation Act, seeking a reference of the matters to the High Court on questions of law that had arisen from those re‑assessment orders.

While those proceedings were pending, the same assessee, on 6 December 1954, filed a petition challenging the provisions of the Investigation Act as illegal, ultra vires, and unconstitutional. The majority of this Court, in that earlier case, observed that although different persons fell within the same class of substantial evaders of income tax, they were subjected to different procedural regimes: one group faced a summary and drastic procedure, whereas the other group was afforded the normal procedure that conferred various rights which the specially treated group under the Investigation Act did not enjoy. Consequently, the Court held that the assessments made under section 8(2) of the Act were void and unenforceable. That decision concerned an assessment under section 8(2) made in invitum after an investigation conducted under the Investigation Act.

The present appellant, after the investigation, entered into a settlement with the tax authorities and was assessed according to the terms of that settlement. He continued to make payments to discharge the balance due under the settlement, and on 8 September 1957 he made his final payment of rupees 8,000, thereby bringing the total amount paid to rupees 1,28,000. During this period, the Income Tax Officer issued a certificate to the Collector of Delhi requesting recovery of the remaining balance under the settlement. Acting on that certificate, certain properties owned by the assessee and located in Dharamsala and Hissar were attached.

On 27 December 1957, the assessee filed an application before the Income Tax Commissioner. He pointed out that between 5 July 1954 and the date of his application he had paid the full sum of rupees 1,28,000 toward his liability under the settlement. He also referred to the Supreme Court’s decisions in Suraj Mall Mohta’s case and Muthiah’s case, arguing that the settlement made under section 8A of the Investigation Act had no legal force and did not bind him. He contended that the settlement had been obtained under pressure and the coercive machinery of the Investigation Act, and therefore could not be considered binding. Moreover, he submitted that after section 5(1) of the Investigation Act had been held unconstitutional, a settlement under section 8A could not be enforced because its very foundation—the reference made under section 5(1)—had collapsed, and the superstructure built upon it must consequently fall. In light of these arguments, the assessee requested that the attached properties be released.

After the Commissioner of Income Tax had refused the petitioner's request for a refund of the amount already recovered under the settlement, the Commissioner issued a formal communication on 29 January 1958. The letter, identified as No L‑228(1)/54‑55/17590, originated from the Office of the Commissioner of Income Tax, Delhi and Rajasthan, located in New Delhi, and was dated the same day. It was addressed to Shri Basheshar Nath, whose residence was listed as 9 Barakhamba Road, New Delhi. The salutation read “Dear Sir,” and the subject line referred to the Taxation on Income (Investigation Commission) Act, 1947 and specifically to an order made under section 8A(2) of that Act. The letter mentioned the petitioner’s own submission dated 27 December 1957 and recalled the two Supreme Court decisions cited in the petition, namely the cases reported in [1955] 1 S.C.R. 448 and [1955] 2 S.C.R. 1247. The Commissioner then stated, in a clear and unequivocal manner, that the settlement reached under section 8A(2) of the Taxation on Income (Investigation Commission) Act, 1947 was valid and binding upon the petitioner. Consequently, the Commissioner demanded that the petitioner discharge any arrears of instalments that had remained unpaid, setting a deadline of 5 February 1958 for such payment. He further required the petitioner to continue making the instalment payments according to the schedule already agreed. The letter warned that failure to comply would result in vigorous recovery proceedings through the ordinary recovery channels. The communication was signed “Your’s faithfully, Sd./‑ S. K. Gupta, Commissioner of Income‑tax, Delhi & Rajasthan, New Delhi.”

Feeling aggrieved by this decision, the petitioner filed an application before this Court, obtained special leave to appeal the Commissioner’s order, and the appeal now stood for final disposal. The respondents, wishing to obtain a conclusive determination of the disputed issues, chose not to press the technical objection that an appeal under Article 136 of the Constitution could not be entertained against an order of the Commissioner of Income Tax. The petitioner’s counsel did not pursue a claim for a refund of the amounts already paid; instead, the appeal was confined to the balance that remained payable under the settlement, which the petitioner characterized as invalid. Model Knitting Industries Ltd., which had a parallel suit pending before the High Court of Calcutta involving the same questions, was allowed to intervene, and counsel for that intervener was heard. The Attorney General, relying on the three earlier decisions, argued that the powers granted to the Commission by section 6 and the procedure prescribed by section 7 of the Investigation Act were not discriminatory. However, he emphasized that none of those decisions declared section 5(1) of the Act to be entirely void or inoperative. According to his submission, section 5(1) merely empowered the Central Government to refer specified cases to the Commission, and upon such a reference the Act provided two distinct procedural routes: an investigative inquiry conducted in‑vitro under the powers of the Act, and a settlement procedure under section 8A.

In the present matter, the Court observed that if the first procedure‑type investigation is pursued and an assessment is made under section 8(2), that assessment must be held invalid, a result that had already been affirmed in Muthiah’s case (1). The Court, however, rejected the contention that when the settlement procedure under section 8A is applied, the resulting assessment under that provision cannot be challenged. Such a line of argument was deemed untenable in light of the clear language of the Investigation Act. The Court recalled that when the assessee’s case was referred to the Commission under section 5(1) on 22 July 1948, the Act contained no provision for settlement. Consequently, that referral bound the assessee to the sole investigative process that the Act then prescribed. The Court further noted that after section 8A was inserted into the Investigation Act by section 33 of Act 67 of 1949, a new authorised official was created under section 6(3) to investigate the affairs of the assessee, to examine books, to interrogate any person and to obtain statements. Sub‑section 6(4) expressly gave this authorised official the same powers that had previously been vested in the Commission under sub‑sections (1) and (2) of section 6. Moreover, the text of section 8A itself makes clear that any person whose case is referred to the Commission may, at any stage of that investigation, apply to the Commission for a settlement. This settlement provision was therefore an integral component of the overall investigative procedure and not a separate, independent process. While it was true that nothing prohibited the assessee from immediately proposing a settlement before the Income Tax authorities had taken any investigative step, the Commission could not forward such a proposal to the Central Government unless it first satisfied itself that the terms of settlement were acceptable. To reach that satisfaction, the Commission necessarily had to examine the facts, either personally or through the authorised official, and to consider the material gathered by that official, which inevitably required conducting an investigation in accordance with the procedural requirements of the Investigation Act. Hence, the proposition that a settlement could be effected without any investigation was incorrect. In the Court’s opinion, section 8A did not establish a distinct procedural track. A reference under section 5(1) was fundamentally a reference for investigation, and a settlement could emerge only as part of that investigative process, much as parties to a suit may reach a compromise during the pendency of the suit. When a compromise is recorded and a judgment is passed based on it, the court exercises the same jurisdiction as it does when adjudicating the suit itself. Similarly, when the Commission entertains a settlement proposal, it exercises its investigative jurisdiction under section 5, follows the procedure prescribed by section 7, and wields all the powers conferred by section 6. The language of section 8A itself confirms that a settlement may be proposed only during an ongoing investigation, and therefore the Attorney General’s argument that the Investigation Act provided for two separate procedures was not well‑founded.

In the context of a compromise that is recorded and a judgment that is rendered pursuant to that compromise, the court exercises the same authority it would exercise when it entertains and disposes of the suit itself. In a similar manner, when the Commission entertains a proposal for settlement, it does so by exercising its investigative jurisdiction under section 5, by following the procedure set out in section 7, and by using all the powers conferred upon it by section 6. The wording of section 8A itself indicates that a settlement may be proposed only during the course of such an investigation. Consequently, the contention raised by the learned Attorney General that the Investigation Act provides for two separate procedures is not supported by the language of the statute. The learned Attorney General further observes that the Investigation Act was enacted before the Constitution came into force, at a time when the concept of fundamental rights did not exist, and therefore its provisions could not be challenged even if the procedure appeared discriminatory. He then argues that after the Constitution became operative, the assessee was not subjected to the coercive procedure prescribed by the Investigation Act; instead, the assessee voluntarily proposed a settlement that was accepted by the Central Government on the Commission’s recommendation. The Attorney General likens this situation to that of Qasim Razvi and contends that the observations made in the majority judgment of Mukherjea J. in Syed Qasim Razvi v. The State of Hyderabad should apply to the present appeal. The Court, however, does not consider it necessary to examine the detailed facts of the Qasim Razvi case or to assess the correctness of the reasoning adopted there, as such an examination would be appropriate only before a larger Bench. The Court is of the view that the observations in that majority judgment must be confined strictly to the special facts of that case and should not be extended to other matters. Accordingly, the Court finds that those observations have no application to the facts before it, because even after the Constitution commenced, the investigative process continued: the authorised official kept collecting material in accordance with the procedure of section 7 and exercised the powers granted by section 6 of the Investigation Act. The final argument put forward by the learned Attorney General is that if the assessee’s fundamental right had been infringed by subjecting him to a discriminatory procedure under the Investigation Act, his voluntary entry into a settlement would constitute a waiver of that breach, thereby preventing him from later invoking his fundamental right. This raises two questions for determination: first, whether an assessee can waive a breach of a fundamental right, and second, whether, given the facts and circumstances of the present case, the assessee actually effected such a waiver. With respect to the first question, the Court refers to the principles laid down in Behram Khurshed Pesikaka v. State of Bombay.

In the judgment the Court examined a general discussion concerning whether a fundamental right could be waived. The discussion began with a citation to a point made on page 638 by Justice Venkatarama Aiyar, who observed that the legal effect of a statute declared unconstitutional depends on two considerations. The first consideration is whether the constitutional prohibition that has been infringed affects the legislative competence to enact the law, or whether it merely serves as a check on the exercise of a power that lies within the legislature’s competence. The second consideration, if the prohibition is merely a check, is whether the law is enacted for the benefit of individual persons or whether it is imposed for the benefit of the public generally on public‑policy grounds. Justice Aiyar explained that when a law is beyond the legislature’s competence—for example, when a State enacts a provision that falls within the exclusive competence of the Union—the law is a nullity. The same result follows where a limitation on legislative power is imposed in the public interest, such as the provisions contained in Chapter XIII of the Constitution relating to inter‑State trade and commerce.

Justice Aiyar continued that when the law is within the competence of the legislature and the unconstitutionality arises because the law is repugnant to provisions that are enacted for the benefit of individuals, the statute is not a nullity but is merely unenforceable. He stated that such unenforceability can be waived, and if a waiver occurs the law becomes enforceable. He noted that this principle is well settled in America, referring to the authorities Cooley on Constitutional Limitations, volume 1, pages 368‑371; Willis on Constitutional Law, pages 524, 531, 542 and 558; and Rottschaefer on Constitutional Law, pages 28 and 29‑30.

After referring to three decisions of the United States Supreme Court that the learned Attorney General also relied upon, the learned Judge concluded that the same position must obtain under the Indian Constitution when a law contravenes a prescription intended for the benefit of individuals. The Judge explained that the rights guaranteed under Article 19(1)(f) are enacted for the benefit of owners of property, and when a law is found to infringe that provision, any person whose rights have been infringed may waive the infringement. Once a waiver is effected, there is no legal impediment to the enforcement of the law. By contrast, if the statute were a nullity, it could neither be waived nor enforced. Consequently, if the law is merely unenforceable and may take effect when waived, it cannot be treated as nonexistent or removed from the statute book. The Judge added that the question of waiver is relevant to the present controversy not because it raises any factual issue for determination, but because it illuminates the nature of the right declared under Article 19(1)(f) and the legal effect of a statute that contravenes that right.

Mahajan, the Chief Justice, speaking together with Mukherjea, Vivian Bose and Ghulam Hassan, delivered a judgment that was recorded at page 653. In that portion of the judgment they observed that the doctrine of waiver, which some American judges have developed in interpreting the United States Constitution, could not be adopted into the Indian Constitution without a much more extensive discussion of the subject. They cautioned that no inference in deciding the present case should be drawn on the basis of that theory. When the learned Attorney General was asked about the doctrine, he did not appear very enthusiastic about it. The Court further stated that, without finally forming an opinion on the question, they were not at present convinced that the waiver theory had any relevance for construing the fundamental rights guaranteed by Part III of the Constitution. The Court explained that the rights described as fundamental rights arise as a necessary consequence of the declaration in the preamble that the people of India have solemnly resolved to constitute India into a sovereign democratic republic and to secure to all its citizens justice, social, economic and political liberty of thought, expression, belief, faith and worship, and equality of status and of opportunity. The Court emphasized that these fundamental rights were not placed in the Constitution merely for the benefit of individuals, although eventually they operate in relation to individual rights. Rather, they were introduced as a matter of public policy, and consequently the doctrine of waiver could not be applied to provisions of law that were enacted as part of constitutional policy. By referring to several articles, including Articles 15(1), 20 and 21, the Court made the proposition clear: a citizen cannot invite discrimination by telling the State “you can discriminate,” nor can a citizen obtain a conviction by waiving the protection afforded under Articles 20 and 21.

At another stage, one of the judges chose not to express an opinion on the subject and, on page 670, recorded that in reaching his conclusion he largely agreed with the observations of Justice Venkatarama Aiyar on that part of the case. However, he warned that he did not wish to be taken as agreeing with the remainder of Justice Aiyar’s observations, especially those concerning waiver of unconstitutionality, the view that fundamental rights constitute merely a check on legislative power, or the suggestion that the declaration in Article 13(1) is “relatively void.” On those particular topics the judge expressly declined to give any opinion at that time.

The Court then noted that the observations made by the learned judges in the earlier case did not concern the waiver of a breach of the fundamental right under Article 14. The present dispute, the Court observed, concerns a breach of the fundamental right founded on Article 14 of the Constitution, which is the right that the assessee alleges to have been violated. Consequently, the question before the Court is whether a breach of the fundamental right that flows from Article 14 can be waived. The Court further clarified that, for the purpose of deciding the present appeal, it was unnecessary to consider whether any of the other fundamental rights enshrined in Part III of the Constitution could be waived.

The Court expressed the view that it should refrain from making any pronouncement on a question that is not strictly necessary for disposing of the case that is before it. Accordingly, the Court limited its discussion to Article 14 of the Constitution and set out its analysis on that basis. Article 14 reads: “The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India.” This provision is the first of the five articles grouped under the heading “Right to Equality.” The object of Article 14 is unmistakably to secure, for all persons—whether citizens or non‑citizens—the equality of status and of opportunity that is celebrated in the preamble of the Constitution. The provision incorporates the English doctrine of the rule of law and the equal‑protection clause of the Fourteenth Amendment to the United States Constitution, which commands that no State shall deny any person within its jurisdiction the equal protection of the laws. Consequently, there can be no doubt that Article 14 rests on a sound public‑policy principle that is recognised and valued in every civilised nation. The wording of the article must be noted as an admonition addressed to the State; it does not directly confer a personal right in the manner of some other articles, for example Article 19. The duty imposed upon the State, however, inevitably benefits every person, because as a necessary result of the article’s operation all individuals enjoy equality before the law. Thus the command of Article 14 is directed to the State, and the extent to which the State complies with that command determines the scope of the fundamental right that every person within India is entitled to enjoy. Moreover, the benefit of the article is not confined to Indian citizens; it is available to any person who is present within the territory of India. By virtue of Article 12, “the State” that Article 14 forbids from discriminating includes the Government and Parliament of India, the Government and legislature of each State, and all local or other authorities that are situated in India or are under the control of the Government of India. Accordingly, Article 14 operates as an injunction that binds both the legislative and executive organs of the State as well as subordinate authorities.

With respect to the legislative organ of the State, the fundamental right guaranteed by Article 14 is further reinforced and protected by the provisions of Article 13. Clause (1) of Article 13 provides that all laws in force in the territories of India immediately before the commencement of the Constitution, to the extent that they are inconsistent with the provisions of Part III, shall be void. This clause, together with clause (2) of the same article, prevents the State from enacting any law that takes away or abridges the rights conferred by Part III, declaring such a law void to the extent of the inconsistency. The Court noted that, unlike certain other articles such as Article 19, there is no relaxation of the restriction imposed by Article 14; the right to equality before the law is therefore secured completely and without exception from all legislative discrimination. While the Court did not consider whether an executive order qualifies as a “law” within the meaning of Article 13, it emphasized that even absent the assistance of Article 13, the right to equal protection of the law remains fully protected.

Article 13 declares that any law existing before the Constitution began, which is inconsistent with the provisions of Part III, shall be void to the extent of that inconsistency. Clause (2) of the same article further prohibits the State from enacting any law that takes away or abridges the rights conferred by Part III, and provides that any law made in contravention of this clause shall be void to the extent of the contravention. The Court observed that, unlike certain other articles such as Article 19 clauses (2) to (6), there is no relaxation of the restriction imposed by Article 13; consequently, the right to equality before the law is secured absolutely and without exception against any legislative discrimination. The Court noted that it was unnecessary to decide whether an executive order qualifies as a “law” within the meaning of Article 13, because even in the absence of Article 13 the right to equal protection of the law shields individuals from any arbitrary action of the executive. In support of this view, the Court referred to the observations of Lord Atkin in Eshugbayi Eleko v. Officer Administering the Government of Nigeria, where his Lordship remarked that, according to British jurisprudence, no member of the executive may interfere with the liberty or property of a British subject unless the executive can substantiate the legality of his act before a court of justice. The Court further emphasized that the language of Article 14 expressly commands that “the State,” which under Article 12 includes the executive, shall not deny any person equality before the law or the equal protection of the law. Thus, Article 14 protects citizens from both legislative and executive tyranny in the form of discrimination. The Court then considered whether a breach of the State’s constitutional obligation could be waived by any individual. It held that the Constitution’s unequivocal command to the State cannot be set aside merely because a person tells the State that it may do so. If the Constitution asks the State why it failed to fulfil its duty, the State cannot answer that a private individual permitted the violation, just as Adam could not escape responsibility for eating the forbidden fruit by blaming the woman who tempted him. The Court concluded that no person can relieve the State of its solemn constitutional duty to ensure equality before the law.

The Court observed that the woman had tempted him and therefore he ate the forbidden fruit. It seemed absolutely clear, from the language of Article 14, that this provision constituted a command issued by the Constitution to the State as a matter of public policy, intended to give effect to the Constitution’s purpose of securing equality of status and opportunity. The Court noted that every welfare State, such as India, is expected by its Constitution to fulfil this obligation, and that no individual could, by any act or conduct, relieve the State of the solemn duty imposed by the Constitution. Whatever breach of other fundamental right a person or citizen may or may not waive, he could not give up or waive a breach of the fundamental right that is indirectly conferred on him by this constitutional mandate directed to the State. The Attorney General had placed reliance on various passages from textbooks authored by well‑known writers such as Cooley, Willoughby, Willis and Rottschaefer, and also cited eight decisions of American courts. In examining the statements of law advanced by those American scholars and judges, the Court felt it necessary to recall observations made by Chief Justice Patanjali Sastri in The State of Travancore‑Cochin and others v. The Bombay Co. Ltd. (1). Those observations stressed that the scope and purpose of American doctrines had evolved through a varied body of tests, doctrines and interpretations, moulded by the growth of American commerce and industry, and the Court expressed the opinion that those American doctrines offered little assistance in resolving problems that arise under Article 286 of the Indian Constitution, citing the decision [1952] S.C.R. 1112, 1120, 1121. The Court also referenced The State of Bombay v. R.M.D. Chamarbaugwala (1) for the same reason. The American authorities cited by the Attorney General related to waiver of contractual obligations, deprivation of property without due process, or the right to trial by jury, and therefore had no relevance to the question of waiving the equal protection clause of the Fourteenth Amendment, which, like Article 14, is a mandate directed at the State. It was significant that no American decision existed that upheld a waiver of a breach of that clause. The Court indicated that when a case involving breach of any fundamental right similar to those discussed in American authorities comes before it, then those authorities will be considered. For the present, the Court confined its observations to the waiver of breach of the fundamental right under Article 14. The Attorney General also relied on three decisions of this Court: Laxmanappa Hanumantappa Jamkhandi v. Union of India (2), Dewan Bahadur Seth Gopal Das Mohta v. Union of India (3) and Baburao Narayanrao Sanas v. Union of India (4).

In support of his view that a breach of Article 14 could be waived by an individual, the learned Attorney General cited four judgments, the first three of which were decided together on 21 October 1954. The Court observed that in none of those decisions was the issue of waiver expressly or thoroughly discussed. Counsel for the intervener explained that the first cited case was decided on the premise that Article 265, not being a fundamental right under Part III, could not be enforced through Article 32. The same counsel further argued that the second case could be understood on that same basis and also on the additional ground that a proceeding under Article 32 was not intended to provide relief against a voluntary act of a person, noting that the proper remedy for recovering money lay in an ordinary suit. The cited citations included (1) [1957] S.C.R. 874, 918, (2) [1955] 1 S.C.R. 769, (3) [1955] 1 S.C.R. 773, and (4) [1954] 26 I.T.R. 725. The third decision was also based on the same reasoning and did not advance the discussion further. Consequently, the Court held that none of these decisions could be regarded as expressing a considered opinion on whether a fundamental right under Article 14 could be waived. The Attorney General also referred to a single‑judge decision of the Allahabad High Court in Subedar v. State, where it was held that Article 20(3) conferred only a privilege that could always be waived. The Court noted, however, that if a person voluntarily answers a question, there is no infringement of his fundamental right, because the right protects against compulsory self‑incrimination; therefore, that case did not involve a waiver. Similarly, the Court observed that Pakhar Singh v. State was not a case of waiver for the same reason. Regarding the present appeal, the Court remarked that the factual basis for the waiver plea had not been properly investigated, that the income‑tax order under review made no reference to any waiver, and that the statements of case had been omitted, depriving the Court of the facts on which such a plea might rest. The view taken on the earlier question obviated the need to examine the waiver issue in depth. After considering the nature of the fundamental right flowing from Article 14, the Court was convinced that a citizen or any other person could not waive a breach of the State’s obligation. Accordingly, the Court concluded that the appeal should be allowed and that the order of the Income Tax Commissioner, Delhi, dated 29 January 1958, was set aside.

The Court ordered that the earlier order of the Income Tax Commissioner be set aside. It further directed that all proceedings that were then pending for the implementation of the Union Government order dated 5 July 1954 be quashed. The citations to the earlier reports, namely (1) A. I. R. 1957 All. 396 and (2) A. I. R. 1958 Punj. 294, were noted. The Court also directed that the assessee appellant be awarded the costs of the appeal.

Justice Bhagwati expressed agreement with the reasoning and the conclusion reached in the judgments prepared by the Chief Justice and by Justice S. K. Das. He agreed that the proceedings undertaken under section 8‑A of the Taxation on Income (Investigation Commission) Act, 1947 (Act 30 of 1947) were beyond the authority of the statute, rendering them ultra vires, and that the settlement obtained under that section was therefore void. Regarding the portion of those judgments that examined whether a constitutional fundamental right could be waived, Justice Bhagwati aligned himself with the judgment of Justice Subba Rao. He held that a citizen cannot waive the fundamental rights guaranteed by Part III of the Constitution.

The issue of waiver was raised before the Court in the following manner. The respondent argued that, if the proceedings and the settlement under section 8‑A were void, the appellant had nevertheless waived the fundamental right protected by Article 14 of the Constitution and consequently could not challenge the settlement. This allegation was presented merely as a reply to the appellant’s contentions and was not detailed in any affidavit filed on behalf of the respondent. Nevertheless, the learned Attorney‑General relied upon the application made by the appellant before the Investigation Commission, the content of that application, and the payments made by the appellant both before and after the decision in M. Ct. Muthiah v. The Commissioner of Income‑Tax, Madras (1), to support the claim of waiver. No party objected to the Court deciding the waiver issue on the basis of those materials, and the question was argued at length.

The arguments extended beyond Article 14 and covered the entire field of fundamental rights. The Court observed that the preamble to the Constitution, Article 13, and the language used to enact the fundamental rights lead to a single conclusion: unlike the approach taken in the United States, the Indian Constitution makes no distinction between fundamental rights that serve individual benefits and those enacted in the public interest or on public‑policy grounds. The Court noted that India is a young democracy, still developing socially, economically, educationally, and politically, and therefore the protection of fundamental rights must be upheld without importing foreign doctrines that would diminish their scope.

In this case, the Court observed that the Supreme Court held a solemn responsibility to protect the fundamental rights that were first introduced in Part III of the Constitution. It noted that any restrictions on those rights were to be found within the Constitution itself, such as the provisions contained in Articles 19, 33 and 34. The Court emphasized that, unless a limitation on a fundamental right was expressly set out in a constitutional article, there could be no valid reason to import concepts from the United States or to rely on decisions of the United States Supreme Court to diminish the extensive protection given to the fundamental rights in Part III. The Court traced the origin of India’s declaration of fundamental rights to a passage in the Report of the Nehru Committee of 1928. The report compared India’s situation with that of other dominions, observing that Canada, Australia and South Africa lacked a declaration of rights, whereas the Constitution of the Irish Free State contained articles that could be grouped under the heading “fundamental rights.” The report argued that Ireland’s circumstances before its treaty were the closest parallel to India’s, and that the Irish people, like the Indian people, sought to secure fundamental rights that had been denied to them. It further explained that the other dominions had inherited English law from earlier settlements, while Ireland had been ruled by England against its will and attained dominion status through a treaty, a situation the Committee felt resembled India’s own position as a dependency of Great Britain. The Committee asserted that India’s constitutional status could be changed either by force or by mutual consent, and that mutual consent was the desirable path, requiring a constitution that guaranteed fundamental rights in a way that would prevent their removal under any circumstances. The Court recalled that at the Round Table Conference preceding the Government of India Act of 1935, Indian leaders pressed for the inclusion of a Bill of Rights in the proposed Constitution Act so that the administration would be bound by specific declarations of individual rights. That request was rejected by the Simon Commission, which observed that while many post‑War European constitutions contained such provisions, experience showed them to be of limited practical value, stating that abstract declarations were ineffective without the will and means to enforce them. Nevertheless, the framers of the Indian Constitution ultimately adopted an approach influenced by the American perspective, choosing to incorporate fundamental rights in Part III of the Constitution despite the Simon Commission’s objections.

In its reasoning, the Court cited Thomas Jefferson’s celebrated statement, contrasting it with the view expressed by the Simon Commission. The quotation read: “The inconveniences of the declaration are, that it may cramp government in its useful exertions. But the evil of this is short‑lived, moderate and reparable. The inconveniences of the want of a declaration are permanent, afflictive and irreparable. They are in constant progression from bad to worse. The executive in our governments is not the sole, it is scarcely the principal object of my jealousy. The tyranny of the legislatures is the most formidable dread …” (see Basu’s Commentary on the Constitution of India, Vol. 1, p. 74). By adopting this passage, the Court indicated that the framers of the Constitution preferred Jefferson’s approach over the Simon Commission’s skepticism and therefore incorporated fundamental rights in Part III of the Constitution.

The Court noted that the purpose of this incorporation was expressed in the preamble, which aimed “to secure to all its citizens justice—social, economic and political; liberty of status and of opportunity; and to promote among them all fraternity assuring the dignity of the individual and the unity of the Nation.” Article 13 was then set out. Article 13(1) declared that all laws in force in the territory of India immediately before the commencement of the Constitution, to the extent that they were inconsistent with the provisions of Part III, would be void. Article 13(2) stipulated that the State must not make any law that takes away or abridges the rights conferred by Part III, and any law made in contravention of this clause would be void to the extent of the contravention.

The Court explained that “laws in force” were defined in Article 13(3) as “laws passed or made by a Legislature or other competent authority in the territory of India before the commencement of the Constitution and not previously repealed, notwithstanding that any such law or any part thereof may not be then in operation either at all or in particular areas.” It further observed that the definition of “State” in the wider sense, as given in Article 12, included the Government and Parliament of India, the Government and the legislature of each State, and all local or other authorities within the territory of India or under the control of the Government of India (see Article 12). Consequently, the Court held that the prohibition under Article 13 was effective both against past laws and against future laws. All laws, whether enacted before or after the Constitution’s commencement, were declared void to the extent that they were inconsistent with or in derogation of the fundamental rights enshrined in Part III. No distinction was drawn between past and future statutes; both categories were equally subject to the voidness provision whenever they conflicted with the guaranteed fundamental rights.

In this regard, the provisions of the Constitution declared that any law which was inconsistent with, or contravened, the fundamental rights would be void only to the extent of that inconsistency, while any part of the law that did not offend the rights would remain effective. The Constitution, under Article 13(2), expressly warned the State not to enact any legislation that would take away or abridge the rights guaranteed by Part III. This warning created an obligation that applied equally to every citizen of Bharat with respect to all fundamental rights set out in Part III. The text of Article 13(2) made no separation between rights that were intended for the individual’s benefit and those that were framed for public interest or public policy. Consequently, a question arose as to whether a citizen could waive a breach of that constitutional obligation by the State. Invoking the words of the Chief Justice, the Court observed that the Constitution provides an unequivocal admonition, being the supreme law of the land, and it is not permissible for the State to disregard this mandate simply because a citizen suggests that it may do so. If the Constitution were to inquire why the State failed to comply with its directive, the State could not respond that a citizen had no objection to the infringement. The Court likened such a response to the biblical story of Adam, noting that the State would not have a better defence than Adam’s plea that the woman had tempted him to eat the forbidden fruit. A careful reading of Article 13(2) therefore confirms that the constitutional mandate is binding upon the State, and no citizen, by any act or conduct, can relieve the State of the solemn duty imposed by that article. Moreover, the Constitution does not allow any distinction between rights protected for individual benefit and those protected for the public good or public policy. The Court then examined the argument that certain fundamental rights, such as the right to property, are purely private and can be waived by the holder, whereas other rights serving public policy cannot be waived even if the individual is affected. The Court noted that this distinction had been heavily advocated before it and was supported by references to certain decisions of the Supreme Court of the United States, but it rejected the notion that such a separation is permissible under the Indian Constitution.

The Court observed that the distinction drawn by the learned judge in Behram Khurshed Pesikaka v. The State of Bombay, which relied on passages from Willoughby, Willis and Rottschaeffer as quoted in that judgment (pages 638‑643 of the Report), could not be accepted. It held that none of the articles that embody the fundamental rights in Part III of the Constitution contain any language that supports such a separation. The Constitution enacts the fundamental rights with precision, and wherever any limitation on their exercise is contemplated, that limitation is also expressly set out within the same articles. Consequently, there is no justification for reading into the articles anything beyond what is expressly written. The Court further noted a difference between the American Constitution and the Indian Constitution. The former, it said, was framed mainly to create a more perfect union, establish justice, insure domestic tranquillity, provide for common defence, promote the general welfare and secure the blessings of liberty; it was essentially an outline of government and nothing more. In contrast, the Indian Constitution was enacted to secure to all citizens justice, liberty, equality and fraternity, to emphasise the welfare‑state concept, and to contain detailed provisions that define rights as well as the restrictions that may be imposed in the interest of the general welfare. The Court cited Wills’ Constitutional Law (p. 477) which observes that the conflict between man and the State is as old as history and that a compromise must be struck between private liberty and public authority, requiring a balance of competing interests. It explained that the United States Constitution attempts to achieve this balance through express limitations written into the Constitution, through implied limitations interpreted by the Supreme Court, and through the development of governmental powers such as regulation, taxation and eminent domain. By contrast, the Indian Constitution expressly seeks to balance a written guarantee of individual rights with the collective interests of the community by making express provisions for that purpose in Part III, as illustrated in Gopalan v. State of Madras (1). Finally, the Court cautioned that when considering the statements of American textbook writers and the dicta of United States Supreme Court judges cited in the earlier decisions, one must remember the admonition of Patanjali Sastri, C. J., in State of Travancore‑Cochin v. The Bombay Co., Ltd. (2), namely that those clauses differ widely in language, scope, purpose and the body of doctrines that have developed around them.

In discussing the varied doctrines that had developed in the United States to interpret, extend or limit constitutional principles in response to the growth of American commerce and industry, the Court observed that those doctrines, as cited in the reports (1) [1950] S.C.R. 88 and (2) [1952] S.C.R. 1112, 1120, offered little assistance for resolving the issues raised under Article 286 of the Indian Constitution. The Court further noted that the same limitation applied to the articles embodying the fundamental rights in Part III of the Indian Constitution, referring also to The State of Bombay v. R. M. D. Chamarbaugwala (1). The rights conferred on citizens, the Court explained, could be classified into three categories: statutory rights, constitutional rights, and fundamental rights. While statutory rights were not germane to the present discussion, constitutional rights were defined as those created and bestowed by the Constitution itself and, according to textbooks and United States Supreme Court decisions previously mentioned, could be waived by a citizen. However, when such constitutional rights were elevated to the status of fundamental rights—rights that, although part of the Constitution, were expressly distinguished from other constitutional rights such as those found in Articles 265 and 286 and in Part XIII—the Court held that they became absolutely inviolable except where the Constitution itself expressly permitted a limitation. Consequently, a citizen could not waive these fundamental rights. The Court emphasized that the Constitution adopted by the nation’s founders was sacrosanct and could not be altered by analogy or reasoning drawn from United States Supreme Court decisions; any change could occur only through a proper constitutional amendment. The Court found no real difficulty in reaching this position and considered the difficulties cited in (1) [1957] S.C.R. 874, 918 to be more imaginary than factual. The Court further observed that if a citizen attempted to assert a fundamental right, for example under the circumstances described in the judgment of S. K. Das, J., and filed a writ petition under Article 32 or Article 226, the Court would likely refuse relief on a discretionary basis. Such discretion, the Court noted, was purely discretionary and no court would ordinarily exercise it in the citizen’s favour, as illustrated in Dewan Bahadur Seth Gopal Das Mohta v. Union of India (1), Baburao Narayan Savas v. Union of India (2) and Laxmanappa Hoonmantappa Janakhandi v. Union of India (3). Even if relief were granted, it would probably be limited to a declaration that the impugned legislation was ultra vires the Constitution, without any further consequential relief.

In such a situation the court would not grant any consequential relief. To obtain that relief the aggrieved person would have to approach the ordinary courts of law, where the adjudication would involve not only the question of whether the statutory provision is constitutionally valid but also all other points of law that arise in the dispute between the parties, such as estoppel, acquiescence, limitation and similar doctrines. The court observed that the only issue that could be finally decided by the court would be whether the impugned provision is ultra vires, that is, beyond the authority of the legislature. The citizen who brings the petition would not be automatically entitled to the relief he seeks merely by invoking the constitutional question. These observations, the court explained, do not undermine the principle that a citizen cannot waive the fundamental rights that are guaranteed to him by Part III of the Constitution.

In support of this view, the judgment fully endorsed the opinion expressed by Chief Justice Mahajan in Behram Khursheed Pesikaka v. State of Bombay (page 653), noting that “the rights described as fundamental rights are a necessary consequence of the declaration in the preamble that the people of India have solemnly resolved to constitute India into a sovereign democratic republic and to secure to all its citizens justice, social, economic and political liberty of thought, expression, belief, faith and worship; equality of status and of opportunity.” The court emphasized that these fundamental rights were not inserted into the Constitution solely for the benefit of individuals, although they ultimately affect individual rights; rather, they were introduced as a matter of public policy. Consequently, the doctrine of waiver could not be applied to provisions of law that were enacted as part of constitutional policy. The judgment concluded that it is not open to a citizen to waive the fundamental rights conferred by Part III of the Constitution. It further described the Supreme Court as the bulwark of those rights, warning that any attempt to diminish them would be a sacrilege. The Court affirmed that the result should be the same as the order proposed by the Chief Justice. The judgment then proceeded to note that this case was an appeal by special leave from an order dated 29 January 1958, issued by the Commissioner of Income‑Tax, Delhi, and that the appeal raised two questions of far‑reaching importance: first, the validity of a settlement made under section 8A of the Taxation on Income (Investigation Commission) Act, 1947, after the Constitution came into force.

In this appeal, the Court considered first whether a settlement made under section 8A of the Taxation on Income (Investigation Commission) Act, 1947 remained valid after the Constitution came into force on 26 January 1950, and second whether a fundamental right guaranteed by the Constitution could be deemed waived by the appellant in the circumstances of the case. The appellant before the Court was Basheshar Nath, hereinafter referred to as the assessee. The first respondent was the Commissioner of Income‑tax, Delhi, and the second respondent was the Union of India. Permission was also granted to Model Knitting Industries, a limited liability company located in Calcutta, to intervene because it had a pending suit in the Calcutta High Court involving the same questions. The intervenor was heard in support of the appeal. Counsel for the appellant argued that the Commissioner of Income‑tax, Delhi, functioned as a tribunal within the meaning of Article 136 of the Constitution and had exercised judicial functions when it issued the impugned order dated 29 January 1958. The respondents countered that the so‑called order was merely a reply from the Commissioner to a communication received from the assessee. Nonetheless, the respondents waived any preliminary objection to the maintainability of the appeal, and the Attorney General for the Union expressly stated that he raised no such objection because the Government sought a definitive ruling on a question of great importance and far‑reaching fiscal impact—namely, whether a settlement entered into under section 8A after 26 January 1950 and the subsequent orders issued by the Union were legally valid. Accordingly, the Court proceeded on the basis that the appeal was admissible and found it unnecessary to address, in the abstract, the broader issue of when an order issued by a revenue authority such as the Commissioner of Income‑tax assumes a judicial or quasi‑judicial character. The factual background leading to the appeal was then outlined. The Act received the Governor‑General’s assent on 18 April 1947 and became operative on 1 May 1947. On 22 July 1948, the assessee’s case was referred to the Investigation Commission established under section 3 of the Act. The referral, made under section 5(1), stated that the Central Government had prima facie reasons to believe that the assessee, either alone or in concert with others, had substantially evaded income tax, and therefore the matter was sent to the Commission for investigation and reporting. The investigative period covered the years from 1 April 1939 to 31 March 1947. The Commission’s report, which was placed before the Court, indicated that the case against the assessee concerned his carrying on a business of supplying tents, executing contract works, and acting as a commission agent for various textile mills, both individually and in partnership with his brother.

In this case the petitioner was engaged in supplying tents, executing contract work and acting as a commission agent for several textile mills, both on his own and together with his brother, on a fairly extensive scale. The petitioner filed a total‑wealth statement on 10 November 1948, which was then forwarded to an authorised official appointed under section 6(3) of the Income‑Tax Act. Between 8 January 1949 and 14 October 1949 the authorised official collected the petitioner’s assessment records from the income‑tax authorities and also obtained materials from the Civil Supplies Directorate. On 5 July 1949 the total‑wealth statement was returned by the petitioner, and the order‑sheet records that on 26 May 1950, after the Constitution had come into force, the authorised official issued a notice fixing a hearing for 10 June 1950. The petitioner subsequently applied for time, and the proceedings remained inactive for approximately three years, up to June 1953.

Thereafter the authorised official conducted a preliminary investigation and initially calculated the undisclosed income of the petitioner for the relevant period to be Rs 12,07,000. After further scrutiny of the accounts, examination of the evidence and consideration of the petitioner’s explanations, the authorised official reduced the amount in his final report, submitted toward the end of 1953, to Rs 9,56,345. The Investigation Commission examined the authorised official’s report, heard the petitioner, and concluded that the total amount to be assessed against the petitioner was Rs 4,47,915. In a report dated 24 May 1954 the Commission stated that during the hearing the petitioner and his auditors had applied for a settlement after admitting liability for the said sum. The Commission considered it appropriate to allow the petitioner the benefit of a settlement on a concessional basis, charging 75 percent of the evaded income as tax together with a moderate penalty of Rs 14,064. The petitioner accepted the Commission’s findings regarding both the amount of income that escaped assessment and the tax and penalty payable, and offered a settlement. The Commission therefore recommended that the Government accept the petitioner’s settlement offer.

The Central Government accepted the settlement under section 8A of the Act and, on 5 July 1954, issued an order under section 8A(2) directing the Income‑Tax Officer to issue a demand notice for a sum of Rs 3,50,000, which included the penalty of Rs 14,064. The order also directed that all other necessary proceedings under the Indian Income‑Tax Act or any other law be taken to enforce payment of the demand and the terms of the settlement. Although the settlement did not specify instalments, the petitioner was allowed to pay the amount at a rate of Rs 5,000 per month.

It was recorded that by the date of 8 September 1957 the taxpayer had paid a total amount of Rs 1,28,000 toward the demand that had been made against him. In December 1955 the Supreme Court rendered its judgment in the case of M. C. T. Muthiah versus the Commissioner of Income Tax, Madras. In that judgment the majority of the Judges held that clause 5(1) of the Income‑Tax Act was beyond the powers of the Parliament because it was discriminatory and violated the fundamental right to equality guaranteed by Article 14 of the Constitution. The Court reached this conclusion on the ground that two amendments to clause 34 of the Indian Income‑Tax Act 1922 had rendered the provision unconstitutional – one amendment enacted by the Income‑Tax and Business Profits Tax (Amendment) Act, 1948 (Act 48 of 1948) and a second amendment enacted by the Indian Income‑Tax (Amendment) Act, 1954 (Act 33 of 1954).

Some time before the Supreme Court’s decision, the Income‑Tax Officer concerned had issued a recovery certificate, identified as report (1) [1955] 2 S.C.R. 1247, and had sent it to the Collector of New Delhi. The taxpayer subsequently informed the authorities that, in execution of that certificate, his properties located in Dharamsala and Hissar had been attached. On 27 December 1957 the taxpayer filed a petition with the Income‑Tax Commissioner of Delhi. In that petition, after setting out the material facts, the taxpayer asserted that, following the Supreme Court’s ruling in Muthiah’s case, the settlement reached under section 8A of the Act no longer possessed any legal effect and therefore could not bind him. The petitioner consequently prayed for the release of the attached properties and for the refund of any amounts that had been recovered under the terms of the settlement.

On 29 January 1958 the Commissioner of Income‑Tax issued a reply to the petition. The Commissioner wrote that, with reference to the petition dated 27 December 1957 concerning the settlement arrived at under section 8A(2) of the Taxation on Income (Investigation Commission) Act, 1947, the settlement remained valid and binding on the taxpayer. The Commissioner further requested that the taxpayer regularize the arrears of instalments that had not been paid as of that date by 5 February 1958 and continue making payments in accordance with the instalment schedule that had been agreed, warning that failure to do so would result in vigorous pursuit of recovery proceedings through the ordinary recovery channels.

The taxpayer subsequently applied for and was granted special leave by this Court on 17 February 1958 to appeal against the Commissioner’s order. In the appeal that was originally filed under the special leave, the prayer clause was inadvertently omitted. Later, the petitioner submitted a revised petition in which three specific prayers were articulated: (a) that the report of the Investigation Commission dated 24 May 1954 be set aside; (b) that the settlement based on that report, together with the directions issued by the Central Government pursuant thereto and the subsequent recovery proceedings for the tax arrears, be completely quashed; and (c) that the amounts already recovered be ordered to be refunded. The Court noted that the third prayer concerning refund had not been pressed before it and therefore the Court was relieved of the duty to consider that particular relief in the present appeal.

In determining the circumstances and considerations under which a taxpayer could claim a refund of tax that had been voluntarily paid, the Court first identified the principal issue as the validity of the settlement entered into pursuant to section 8A of the Act. The appellant argued that, because section 5(1) of the Act had been declared ultra vires the Constitution, the foundation of the Investigation Commission’s report no longer existed; consequently, any settlement based on that report was invalid and could not be enforced. The respondents, through the Attorney General, contended that no decision of this Court had held section 5(1) to be wholly void, and that a proper construction of the various provisions of the Act revealed two distinct procedures or jurisdictions for the Investigation Commission: one concerning investigation and the other concerning settlement. They submitted that the jurisdiction conferred on the Commission by section 8A—inserted into the Act in 1949 by section 33 of Act 67 of 1949—remained unaffected by the decision in Muthiah’s case (1). Accordingly, if the Commission possessed the authority to entertain an application for settlement from the taxpayer, to approve that settlement and refer it to the Central Government, the Central Government also possessed authority under subsection (1) to accept the settlement and to issue the necessary orders under subsection (2) of section 8A. In short, the Attorney General’s position was that Muthiah’s decision did not render section 8A constitutionally invalid. The Court noted that it was necessary at this stage to read the relevant statutory provisions that bore directly on the matters before it. It recalled that the Act had come into force on 1 May 1947, which preceded the commencement of the Constitution of India; therefore, on that date no question could arise that the Act violated any fundamental rights guaranteed by the Constitution. Section 3 of the Act empowered the Central Government (now the Union Government) to constitute a body named the Income‑tax Investigation Commission. The section prescribed that the Commission’s duties were, first, “to investigate and report to the Central Government on all matters relating to taxation on income, with particular reference to the extent to which the existing law relating to, and procedure for, the assessment and collection of such taxation is adequate to prevent the evasion thereof”; and second, “to investigate in accordance with the provisions of this Act any case or point in a case referred to it under section 5 and make a report thereon (including such interim reports as the Commission may think fit) to the Central Government in respect of all or any of the assessments made in relation to the case before the date of its report or interim report, as the case may”.

The appeal concerned the specific duty of the Income‑Tax Investigation Commission that was set out in subsection 3(b) of the Act. The Court noted that the provisions governing the composition of the Commission, found in section 4, were not material for the purpose of deciding the matters before it, and therefore they were not examined in detail.

The Court focused on subsections (1), (2) and (4) of section 5, which were regarded as directly relevant to the issues raised. Subsection 5(1) provided that the Central Government could, at any time before the first day of September 1948, refer a case or specific points in a case to the Commission for investigation and report. The referral could be made when the Government had prima facie reasons to believe that a person had substantially evaded payment of income tax, and the Government could also supply any material that supported that belief. The same subsection also allowed the Government, before the same deadline, to apply to the Commission for withdrawal of any case or points that had been referred; if the Commission approved such a withdrawal, the Court held that no further proceedings could be taken by or before the Commission with respect to the withdrawn matters.

Subsection 5(2) was explained as giving the Commission the authority, after examining the material presented by the Central Government and after conducting any investigation it deemed necessary, to report back that, in its opinion, further investigation was unlikely to uncover any substantial tax evasion. Once such a report was made, the investigation was deemed to be closed.

Subsection 5(4) dealt with the situation where, during the course of an investigation under subsection (1), the Commission formed a belief that either a person other than the one originally under investigation had evaded tax, or that additional points beyond those originally referred required investigation. The Commission could then submit a report to the Central Government stating the reasons for its belief. Upon receipt of that report, the Central Government was obligated, notwithstanding the provisions of subsection (1), to immediately refer the case of the other person or the additional points to the Commission for investigation.

The Court observed that the original wording of section 5, as enacted, mentioned the date 30 June 1948, but that Act 49 of 1948 substituted that date with the first day of September 1948. Section 6, which set out the powers of the Commission, was summarised by the Court as follows: the Commission could require any person, banking institution or other company to provide relevant information; it could administer oaths and exercise all the powers of a civil court to take evidence, compel the attendance of witnesses and enforce other procedural requirements; it could impound and retain documents in its custody; it could direct an authorised official to examine accounts and interrogate any person; and it could issue directions to an authorised official.

The Commission also possessed the authority described in clause (f) to terminate an investigation and to render a best‑of‑judgment assessment against any individual who either refused to appear in person or failed to produce the required evidence or documents. In addition, under clause (g) the Commission was empowered to carry out seizure and search operations in circumstances that were specifically prescribed by law. Sections 6A and 6B of the Act dealt with the Commission’s power to offer immunity from prosecution to a person and the circumstances under which such a tender could be withdrawn. Section 7 outlined the procedural requirements that the Commission had to follow, and only sub‑sections (2), (4) and (6) are relevant for the present discussion. Sub‑section 7(2) mandated that any investigation conducted under clause (b) of section 3 must be carried out in accordance with the principles of natural justice and, as far as practicable, in conformity with the Indian Evidence Act, 1872. It further required that the person whose case was under investigation be given a reasonable opportunity to rebut any evidence presented against him. The provision also clarified that the Commission’s power to compel the production of documents was not limited by section 130 of the Indian Evidence Act, 1872, and that for the purposes of sections 5 and 6 of the Bankers’ Books Evidence Act, 1891, the Commission would be deemed to be a court and its proceedings would be treated as legal proceedings. Sub‑section 7(4) stipulated that no individual could inspect, request, or obtain copies of any documents, statements, papers or other materials that had been submitted to, obtained by, or produced before the Commission or any authorized official in any proceeding under the Act. However, the Commission— and, after its dissolution, any authority appointed by the Central Government for this purpose— could, at its discretion, permit such inspection and provide copies to any person. This discretionary power was subject to a condition that, in order to enable the person whose case was being investigated to rebut the evidence on record, the person could apply for certified copies of the documents, statements, papers and materials, and such copies would be supplied upon payment of fees prescribed by rules made under the Act. Sub‑section 7(6) empowered the Commission, again at its discretion, to admit as evidence and to act upon any document even if that document was not duly stamped or registered.

Section 8 dealt with the actions to be taken by the Commission once an investigation was concluded. It required that all the material placed on the record be examined by every member of the Commission, and that the final report be drafted in accordance with the opinion held by the majority of the members. Sub‑section (2) of section 8 gave the Central Government the authority to order a reopening of assessment proceedings based on the Commission’s report. Sub‑section (4) further provided that, in any assessment or reassessment proceeding undertaken pursuant to a direction issued under sub‑section (2), the findings recorded by the Commission would be deemed final, subject only to the exceptions outlined in sub‑sections (5) and (6) of the same section.

In this case the Court reproduced the full text of section 8A of the Act. Sub‑section (1) provided that when any person who was involved in a case that had been referred to or was pending before the Commission for investigation applied to the Commission at any time during the investigation for a settlement of the case or any part of it as it related to him, the Commission was required, if it considered that the settlement terms contained in the application could be approved, to refer the matter to the Central Government. If the Central Government accepted those settlement terms, the Commission was to record the terms and the investigation, insofar as it pertained to the matters covered by the settlement, would be deemed to be closed. Sub‑section (2) explained that, for the purpose of enforcing any settlement reached under sub‑section (1), the Central Government could direct that any proceeding deemed appropriate under the Indian Income‑tax Act, 1922 (XI of 1922), the Excess Profits Tax Act, 1940 (XV of 1940) or any other law could be taken against the person to whom the settlement related. In particular, the provisions of the second proviso to clause (a) of sub‑section (5) of section 23, section 24B, the proviso to sub‑section (2) of section 25A, the proviso to sub‑section (2) of section 26 and sections 44 and 46 of the Indian Income‑tax Act, 1922 were to apply to the recovery of any sum specified in the settlement. The Income‑tax Officer having jurisdiction to assess the person by whom such sum was payable could recover the amount as if it were income‑tax or an arrear of income‑tax within the meaning of those provisions. Sub‑section (3) stated that, subject to the provisions of sub‑section (6) of section 8, any settlement arrived at under this section was conclusive as to the matters expressly stated therein, and that no person whose case had been settled in this way was entitled to reopen any proceeding for the recovery of any sum under the Act, nor in any subsequent assessment or reassessment proceeding relating to income tax, nor in any other proceeding before any court or other authority concerning any matter that formed part of the settlement. Sub‑section (4) added that where a settlement had been accepted by the Government under sub‑section (1), no proceedings under section 34 of the Indian Income‑tax Act, 1922, or under section 15 of the Excess Profits Tax Act, 1940, could be initiated with respect to the items of income covered by the settlement unless the terms of the settlement expressly allowed such proceedings. The Court then noted that section 9 of the Act barred the jurisdiction of courts, but it was not contested that if any provision of the Act were ultra vires the Constitution, section 9 would neither cure the defect nor prevent the assessee from challenging it. Finally, the Court observed that section 10, the last section of the Act, conferred upon the Central Government the power to make rules, and that the foregoing summary constituted a concise statement of the principal provisions of the Act.

In discussing the principal provisions of the Act, it became necessary to refer to several earlier judgments of this Court that examined particular sections of the legislation. The earliest authority concerned the case of Suraj Mall Mohta and Co. v. A. V. Viswanatha Sastri, in which the Court examined sub‑section (4) of section 5 and the procedural mechanism prescribed by the Act for persons proceeded against under that sub‑section. The Court declared those provisions to be discriminatory and consequently void and unenforceable. Notably, the Court did not express any opinion on the validity of section 5(1) itself. The decision is reported in [1955] 1 S.C.R. 448.

Subsequently, the Court addressed the same issue in Shree Meenakshi Mills Ltd., Madurai v. Sri A. V. Viswanatha Sastri. The Court held that after the Indian Income‑tax (Amendment) Act, 1954 (Act 33 of 1954) came into force on 17 July 1954—legislation operating in the same field as section 5(1) of the Act—the provisions of section 5(1) became void and unenforceable because they were discriminatory in character. The Court further observed that a statute which was wholly valid before the adoption of the Constitution could not be questioned for the discriminatory nature of a special procedure that had been employed prior to the Constitution’s commencement; however, the continuation of such a discriminatory procedure after the Constitution came into effect was impermissible. In the Meenakshi Mills case, the Investigation Commission had not even begun the inquiry despite a lapse of seven years, and the investigation remained pending when the writ petitions were filed. The Court therefore concluded that the Commission’s proceedings, which had become discriminatory, could not lawfully proceed.

The next significant ruling was delivered in M. C. T. Muthiah v. The Commissioner of Income‑tax, Madras. In that case, the Investigation Commission conducted inquiries into three matters and submitted its report on 26 August 1952, identifying a specific sum as undisclosed income for the period under investigation. The Central Government accepted the report and issued an order under section 8(2) of the Act on 16 September 1952. Following this, notices under section 34 of the Indian Income‑tax Act were served, and reassessments—except for one year—were issued on the basis of the Commission’s findings, which were treated as final and conclusive. The reassessment orders were served on the assessors in February and May 1954. On 6 December 1954, the assessors filed writ petitions challenging the constitutionality of section 5(1). By a majority, the Court held that section 5(1) was discriminatory and violated the fundamental right guaranteed under article 14 of the Constitution, because section 34 of the Indian Income‑tax Act, 1922, as amended in 1948, operated in the same field and, from and after 26 January 1950, covered the same territorial strip that section 5(1) sought to regulate.

The Court observed that when section 5(1) was applied together with two substantially different procedural statutes—one of which was more prejudicial to the assessee than the other—the two could not be permitted to operate in the same field because of the guarantee of equality under Article 14 of the Constitution. Consequently, the Court held that, except for cases that had already been concluded by reports of the Commission and directions issued by the Government before 26 January 1950, the matters that were pending before the Commission for investigation, as well as assessment or reassessment proceedings that were pending on that date, fell within the ambit of Article 14. Accordingly, the assessment orders that had been made under the challenged provision were set aside as unconstitutional.

Having dealt with that issue, the Court turned to the questions that remained for resolution. The first question was what effect the decision in Muthia’s case (1) would have in the present matter. The second question was whether the Act contemplated two separate and distinct, yet severable, procedures or jurisdictions—one relating to investigation and the other to settlement—so that any alleged discrimination would attach only to the investigative procedure and not to the settlement procedure. The Court found that the learned Attorney General could not avoid the position expressly stated in Muthia’s decision (1), namely that section 5(1) of the Act was struck down by Article 14 of the Constitution for the period after 26 January 1950.

The Court reproduced the ratio of the earlier decision as explained in the majority judgment at pages 1260‑1261: “After 8 September 1948 there were two procedures operating simultaneously: one under Act XXX of 1947 and the other under the Indian Income‑Tax Act, both dealing with persons who fell within the same class—substantial evaders of income‑tax. Consequently, some persons in that class were dealt with under the drastic and summary procedure prescribed by Act XXX of 1947, while other persons of the same class were dealt with under the procedure laid down in the Indian Income‑Tax Act after they had been served notice under the amended section 34(1) of that Act. Thus, different persons belonging to the same class were subjected to different procedures—one a summary, harsh procedure and the other a normal procedure that conferred on the assessee various rights denied to those treated specially under Act XXX of 1947. Although the legislature had the competence to enact these provisions, they could not have been challenged before the Constitution came into force. When the Constitution became operative on 26 January 1950, citizens acquired the fundamental rights enshrined in Part III, including the right to equality before the law and equal protection of the laws under Article 14. Whatever the position had been before that date, the Constitution made it open to the affected persons to question why some members of the same class were subjected to the summary, drastic procedure of Act XXX of 1947 while others were subjected to the normal procedure of the Income‑Tax Act, the former being plainly discriminatory and therefore violative of Article 14.”

In the matter before the Court, persons who were alleged to belong to the class of substantial evaders were permitted to inquire why some of them had been placed under the summary and drastic procedure prescribed in Act XXX of 1947 while others had been subjected to the normal procedure laid down in section 34 and the related provisions of the Indian Income‑tax Act. The Court observed that the procedure contained in Act XXX of 1947 was plainly discriminatory and, consequently, violated the fundamental right to equality enshrined in article 14 of the Constitution. The Court held that this principle was equally applicable to the present case and that, if section 5(1) of the Act became unenforceable after 26 January 1950, any reference made under that section against the assessee after that date must also be treated as invalid. Accordingly, the Court concluded that all actions taken under the drastic and summary procedure prescribed by the Act after 26 January 1950 had to be set aside.

Two lines of argument were advanced but were not accepted in the earlier decisions of Suraj Mall Mohta, Meenakshi Mills and Muthia. The first argument contended that substantial evaders whose cases were referred by the Central Government for investigation by the Commission before 1 September 1948 formed a distinct class of their own. The second argument asserted that proceedings which had commenced before the Commission, on the basis of a reference that was valid at the time it was issued, could not be disturbed by any later amendment of the Income‑tax Act, 1922. The Court noted that extensive discussion had already taken place in the three cited cases on how the two procedures – the one under the Income‑tax Act, 1922 and the other under Act XXX of 1947 – compared with each other. It reiterated, without revisiting the whole analysis, that the Court had unequivocally held that the procedure prescribed by Act XXX was more summary and drastic. In Suraj Mall Mohta’s case, the differences between the two procedures were summarized on pages 463 to 466 of the report, and the Government had conceded that the provisions in sections 6 and 7 of the impugned Act were more severe than the provisions in sections 37 and 38 of the Indian Income‑tax Act. Although the initial stages of investigation bore some resemblance, the overall character of the two procedures was not the same. The learned Attorney General did not dispute this finding; instead, he argued that the question before the Court was not the mere possibility of differential treatment but the actual conduct of the Commission with respect to the present assessee after 26 January 1950. He submitted that the assessee had not, in fact, been subjected to any differential treatment and relied on the ratio of the Court’s decision in Syed Qasim Razvi v. State of Hyderabad, wherein the majority …

The judgment articulated a two‑step test to be applied when a portion of a trial could not be challenged. First, the court must examine whether the discriminatory clauses in the statute can be severed from the remaining provisions and, if so, whether a fair and equal procedural measure can still be achieved without those clauses. Second, the court must determine whether the actual procedure followed relied upon the discriminatory provisions; it was emphasized that a mere threat or possibility of unequal treatment did not suffice to invalidate later proceedings. The Court referred to earlier decisions of this Court, namely Keshavan Madhava Xenon v. The State of Bombay and Lachmandas Kewalram Ahuja v. The State of Bombay. The latter decision, a majority judgment, was distinguished on two grounds: the issue of whether a fair equality of procedure could be secured after removing the discriminatory provisions was neither raised nor examined, and it was assumed that the trial could not proceed without employing the discriminatory procedure, which became void upon the Constitution’s commencement, thereby ending the jurisdiction to act under that procedure. Applying the tests set out in the majority judgment of Syed Qasim Razvi v. The State of Hyderabad, the learned Attorney General argued that in the present case the discriminatory provisions could be separated from the Act and that the assessee had not, in fact, been subjected to any discriminatory process. He also sought to differentiate the present case from Muthia’s case on the basis that the reassessments in that case were grounded on a discriminatory procedure. The Court, however, held that the ratio of the majority decision in Syed Qasim Razvi’s case was inapplicable, and that the principle to be followed was the one laid down in Lachmandas’s case. The majority in Syed Qasim Razvi’s case, as quoted from Mukherjea, J., concluded that “although there were deviations in certain particulars, the accused had substantially the benefit of a normal trial” (see citations (1) [1951] S.C.R. 228, (2) [1952] S.C.R. 710, (3) [1953] S.C.R. 589). In contrast, the minority judgments pointed out that the discriminatory provisions formed an integral part of the regulation under which the accused was tried and were indeed applied. Bose, J. expressed the view that, when testing the validity of a law, it is irrelevant to consider how the law has been applied, because a law is either constitutional or not, and its validity cannot depend on the acts performed under it.

The Court noted that, as previously observed, the constitutionality of a statute does not depend upon what has been accomplished under its provisions. It considered it unnecessary to debate the controversy arising from the two views expressed earlier in the judgment. For the present matter, the Court found it sufficient to articulate two distinct propositions that guided its analysis of the statutory scheme. First, the discriminatory provisions form an essential component of the procedure prescribed by the Act and cannot be severed from the rest of the scheme. Second, the Court was satisfied that the report which resulted in the settlement was prepared by the Investigation Commission in pursuance of, and as a direct consequence of, the discriminatory procedure it employed. The Investigation Commission indeed followed the sole investigative procedure laid down by the Act, a procedure described as drastic and summary in nature. If that procedure were to become void upon the Constitution’s commencement, the Commission’s jurisdiction would effectively cease, as discussed in Lachmandas’s case, supra.

The Court then explained why it could not accept the learned Attorney General’s contention that the Act contains two distinct procedures or two separate jurisdictions. It examined the substantive effect of the Act’s provisions as they relate to the Commission’s duty under section 3 (b). The Commission receives a reference under section 5 (1); if it does not act under section 5 (2), it may exercise such powers under section 6 as it deems necessary. Following that discretion, the Commission proceeds according to the procedure prescribed in section 7 and subsequently submits its report under section 8. Upon receipt of that report, the Central Government is empowered to take appropriate remedial action under section 8 (2) of the Act. Even where the assessee applies for settlement, the Commission retains a duty to report to the Government if the settlement terms receive approval. To discharge this duty, the Commission must obtain the requisite material by exercising its powers under section 6 and by adhering to the procedure stipulated in section 7. The Court observed that the factual chronology of the present case reflected exactly the statutory process prescribed by the Act. An authorised official was instructed to examine the accounts and related documents under section 6 (3), and he completed that examination and issued an interim report in 1953. He conducted the examination in accordance with the Act’s requirements concerning document inspection and witness testimony, and thereafter submitted a final report. The Commission then heard the assessee on 19 May 1954 and reserved its orders, after which the assessee filed a settlement application on 20 May 1954, having learned the likely final finding. The Commission subsequently issued its final report four days after the settlement application was filed, and the findings therein were based on the earlier investigation. Given these facts, the Court found it difficult to accept any characterization that the Commission followed a non‑discriminatory procedure or operated under two separate jurisdictions, one for investigation and another for settlement. In reality, the jurisdiction was singular and the procedure applied remained identical throughout the investigative and settlement phases. The Act does not provide a distinct procedure solely for effecting a settlement, nor is the present situation one where a settlement was reached without applying any investigative provisions.

In this case the Court observed that a complete investigation had been carried out under the provisions of the Act. After the assessee had been subjected to the harsh and summary procedure prescribed by the statute, the Commission informed him of the investigation’s outcome. Subsequently the assessee submitted an application for settlement, and the Commission approved this settlement under section 8A. The Court therefore concluded that the learned Attorney General had not succeeded in showing two points: first, that the decision in Muthia’s case did not apply; and second, that the settlement effected under section 8A was legally valid because of either severability or the non‑application of the discriminatory procedure of the Act to the assessee. The Court therefore rejected the Attorney General’s argument that the settlement was invalid on those grounds.

The Court then turned to the second, more complex issue concerning the waiver of a fundamental right. It noted that the Court has not been able to reach unanimity on this question, as reflected in the citation [1955] 2 S.C.R. 1247. A further difficulty was that the present appeal did not arise from a judgment or order rendered after a trial on properly framed issues; rather, it stemmed from an order that merely rejected the assessee’s prayer that his properties, which had been attached in execution of a recovery certificate, be released and that the amounts paid under the settlement be refunded. The question of waiver had neither been raised nor tried, and the revenue authority had not ascertained the necessary facts. Moreover, the parties had not filed a statement of their case, resulting in the waiver issue being raised for the first time during the arguments before the Court. The Court emphasized that the burden of proof lay with the respondents, who had pleaded waiver. Two questions therefore arose: whether the respondents had established, on the record, the factual basis required for a waiver plea; and, if they had, whether a fundamental right guaranteed by the Constitution could be waived at all. The Court held that if the first question could not be answered affirmatively, the second need not be addressed in the abstract. On behalf of the respondents, it was submitted that, even assuming without conceding that the discriminatory provisions of the Act had been applied before the settlement request, the record showed that the assessee never objected to the procedure, voluntarily sought settlement, obtained a reduction of his tax and penalty liability, and paid the instalments without objection, some of which were made even after Muthia’s decision (1) [1955] 2 S.C.P. 1247. Payments made up to April 1955 amounted to Rs 10,000.

Payments were made by the assessee in a series of installments as follows: Rs 5,000 on 10 May 1955, Rs 5,000 on 19 June 1955, Rs 5,000 on 7 July 1955, Rs 5,000 on 13 August 1955, Rs 5,000 on 7 September 1955, Rs 5,000 on 15 October 1955, Rs 5,000 on 10 November 1955, Rs 5,000 on 15 December 1955, Rs 5,000 on 8 February 1956, Rs 5,000 on 13 February 1956, Rs 5,000 on 7 March 1956, Rs 5,000 on 14 May 1956, Rs 5,000 on 19 May 1956, Rs 5,000 on 13 June 1956, Rs 5,000 on 6 August 1956, Rs 5,000 on 7 September 1956, Rs 5,000 on 9 October 1956, Rs 5,000 on 10 November 1956, Rs 5,000 on 23 December 1956, Rs 5,000 on 14 January 1957, Rs 5,000 on 29 March 1957, Rs 5,000 on 4 June 1957 and Rs 8,000 on 8 September 1957, making a total of Rs 1,28,000. The learned Attorney General referred the Court to the settlement application filed by the assessee before the Commission. In that application the assessee stated that although no disclosure statement had been filed before the authorised official submitted its reports, during the enquiry before the Commission the assessee and his auditors admitted liability for tax on the sum of Rs 4,47,915. The Commission, relying on this admission, opined that the assessee should be permitted to settle by paying 75 percent of the undisclosed income as tax and should also pay a penalty of Rs 14,064. The assessee accepted the Commission’s conclusions regarding the escaped income, the tax due, and the penalty. On the basis of these admissions, the Attorney General argued that there was no basis for the assessee’s claim that the settlement application had been made under duress or because of the coercive provisions of the Act. He submitted that the factual foundation for a plea of waiver had been established and relied upon three Supreme Court decisions—Dewan Bahadur Seth Gopal Das Mohta v. Union of India, Baburao Narayanrao Sanas v. Union of India, and Laxnanappa Hanumantappa Jamkhandi v. Union of India—asserting that those cases accepted similar pleas in comparable circumstances. The assessee, however, contended that the present case lacked any of the essential facts required to sustain a waiver plea and that none of the three cited decisions were decided on a waiver ground. Two of those decisions concerned settlements under section 8A of the Act and one concerned an order under section 8(2). All were decided on applications filed under Article 32 of the Constitution, not on appeals from revenue authority orders. In the Mohta case, the argument advanced was that sections 5, 6, 7 and 8 of the Act were ultra‑vires because they violated Articles 14, 19(1)(f) and 31 of the Constitution, and the prayer sought a declaration of invalidity of those provisions.

In the present petition the applicant sought a complete set‑aside of the proceedings and of every order that the Central Government had issued under section 8A of the Income‑Tax Act in connection with the settlement. The petition also requested that the settlement itself be declared void. The Chief Justice, Mahajan, who authored the judgment, rejected both the argument and the prayer. He explained that the petition was fundamentally flawed because any tax that the applicant had already paid, or any tax that might still be recoverable, was being collected on the basis of a settlement that the applicant himself had proposed and that the Central Government had subsequently accepted. He noted that, owing to the applicant’s request for a settlement, no formal assessment had been made against him pursuant to the complete procedural scheme laid down in the Income‑Tax Act. Accordingly, the Chief Justice held that the applicant could not claim that his fundamental rights were violated under article 32 of the Constitution unless he could demonstrate that his consent to the settlement had been obtained improperly and that he therefore was not bound by it. He further observed that article 32 was not intended to provide relief against deeds that a person voluntarily undertook, and that any remedy available to the applicant would have to be pursued through other appropriate legal proceedings.

Having examined the arguments concerning the true import of the decision in Gopal Das Mohta’s case, the Court observed that the reasoning in that earlier judgment—that article 32 does not furnish a remedy against voluntary actions—came very close to implying that a person had waived his constitutional protection because any injury he suffered arose from his own conduct rather than from an unconstitutional governmental act. Nevertheless, the Court was unable to conclude that the earlier decision rested strictly on the doctrine of waiver. It was noted that some of the observations in that judgment were of a “Delphic nature to be translated into concreteness by the process of litigating elucidation,” echoing the words of Justice Frankfurter in Machinists v. Gonzales. The Court therefore regarded the Mohta decision as addressing primarily the scope of article 32 rather than articulating a comprehensive rule on waiver. This assessment was reinforced by a decision rendered a month earlier in Behram Khurshed Pesikaka v. The State of Bombay, in which the same Chief Justice, albeit tentatively, expressed reservations about importing into the Indian Constitution the American‑style doctrine of waiver without a full discussion. The report of Gopal Das Mohta’s case contains no explicit reference to the waiver doctrine, and there was no fuller discussion of the doctrine within that judgment. Consequently, the Court found it unreasonable to hold that the effect of the Mohta decision was to uphold the doctrine of waiver.

The Court observed that the earlier decisions cited by the learned Attorney General did not advance the doctrine of waiver. In Babu Rao’s case, reported in 1954 at 26 I.T.R. 725, the judgment merely followed the earlier Gopal Das Mohta decision and offered no independent reasoning on waiver. Likewise, the Laxmanappa Jamkhandi case, cited in 1955 at 1 S.C.R. 769, concerned an order under section 8(2) of the Act and, at page 772, the Court stated: “From the facts stated above it is plain that the proceedings taken under the impugned Act XXX of 1947 concluded, as far as the Investigation Commission is concerned, in September 1952, more than two years before this petition was presented in this Court. The assessment orders under the Income‑Tax Act themselves were made against the petitioner in November 1953. In these circumstances we are of the opinion that he is entitled to no relief under the provisions of Article 32 of the Constitution.” The judgment further relied on Ramjilal v. Income‑Tax Officer, Mohindargarh, [1951] S.C.R. 127, holding that because Article 265 provides a special protection that no tax shall be levied or collected except by authority of law, clause (1) of Article 31 must be viewed as dealing with deprivation of property other than by the imposition or collection of tax. Consequently, the right under Article 265 is not a right conferred by Part III of the Constitution and therefore cannot be enforced under Article 32. In light of that decision, the Court concluded that the petition under Article 32 was not maintainable and, even otherwise, it would not be just and proper to issue any discretionary writs in the peculiar circumstances of the case.

The Court therefore held that none of the cited authorities—namely (1) [1955] 1 S.C.R. 773, (2) [1954] 26 I.T.R. 725, and (3) [1955] 1 S.C.R. 769—supported the Attorney General’s contention that a waiver had occurred. Turning to the factual matrix relied upon by the Attorney General, the Court noted that the assessee had indeed submitted to the discriminatory procedure applied by the Commission, had applied for a settlement whereby he agreed to pay seventy‑five percent of the assessed tax liability together with a modest penalty, and had continued to make installment payments even after the Muthia decision of December 1955. The Court asked whether these actions could be characterized as a waiver of a known right.

The judgment emphasized that, at the time the discriminatory procedure was imposed in 1953‑54 and the Commission’s report—upon which the settlement was based—was issued, the assessee neither knew nor had any court declared section 5(1) of the Act to be ultra vires. In his settlement application, the assessee expressly stated in paragraph 3 that the Commission announced its findings, indicating that he was unaware of any illegality in the statutory provision. Accordingly, the Court was of the view that the assessee’s conduct—though it involved participation in the settlement process—did not amount to an intentional or voluntary relinquishment of a known legal right, and therefore could not be said to constitute a waiver.

The Commissioner had stated that, according to its assessment, the income, profits and gains that had escaped assessment by the assessee amounted to Rs 4,47,915. The assessee was aware that, under the Act, this assessment was final and binding upon him. In those circumstances, the assessee filed an application for settlement. The question then arose whether such an application could be regarded as a voluntary or intentional relinquishment of a right that the assessee knowingly possessed. The Court was of the view that it could not. It noted that the term “waiver” is a difficult concept in law. Generally, a waiver requires an intentional and voluntary surrender of a known legal right, or conduct from which such surrender can be inferred. Waiver is distinct from estoppel, being a contractual agreement to release or not assert a right, whereas estoppel is a principle of evidence, as explained in Dawson Bank Limited v. Nippon Menkwa Kabushiki Kaisha (1). The Court asked what specific legal right the assessee had intentionally given up or agreed to release in 1953‑1954. At that time the assessee did not know, nor was it declared by any competent court, that any provision of the Act was ultra vires. The Court doubted that a plea of waiver could be based on the maxim “ignorance of law is no excuse” in the present circumstances. It held that the maxim cannot be stretched to presume that every person must know that a statute enacted by a competent legislature is invalid merely because it creates differential treatment, and that the person must therefore refuse to comply or risk a waiver claim. Such a presumption was not necessary. Rather, the prevailing assumption then was that a law passed by a competent legislature was valid until a court declared it unconstitutional. Moreover, the Court found no basis to infer waiver from instalments paid in 1956‑57, especially since the issue of refunding those payments was no longer before the Court. To hold that every unsuspecting compliance with a law later declared invalid gave rise to a waiver claim would make constitutional rights dependent on the fortuity of timely challenges, thereby rendering them illusory. Consequently, the Court concluded that the factual foundation required to sustain a plea of waiver was absent in this case. Because the burden of proof lay with the respondents, the plea of waiver must fail, and the Court accordingly dismissed it.

Since the foundation for a plea of waiver has not been established in the present case, the Court found it unnecessary to address, in an abstract manner, the broader issue of whether any right guaranteed by the provisions of Part III of the Constitution can be waived at all. The Court emphasized that it must be careful not to pronounce on constitutional questions when a reasonable alternative resolution is available, citing the long‑standing judicial principles that (a) the Court will not anticipate a constitutional issue before it becomes necessary to decide it, as noted in Weaver on Constitutional Law (p. 69), and (b) the Court will not formulate a constitutional rule broader than required by the specific facts before it. While the Chief Justice and Justice Kapur had expressed the view that the fundamental right under Article 14 cannot be waived, Justices Bhagwati and Subba Rao had taken the position that none of the fundamental rights guaranteed by the Constitution may be waived. The author of this judgment regretted having to arrive at a conclusion different from those of the aforementioned colleagues and therefore proceeded to explain the reasons for this divergent view. The issue of waiver had previously been raised, though not definitively resolved, in Behram Khurshed Pesikaka’s case (1). Justice Venkatarama Aiyar had set out his reasoning on pages 638 to 643 of the report, while Chief Justice Mahajan, together with Justices Mukherjea, Vivian Bose and Ghulam Hasan, concurred in views expressed on pages 651 to 655, and the Chief Justice, as Das, J., had reserved his opinion on the matter. Justice Venkatarama Aiyar’s view was that when a constitutional provision infringed by a law relates to the competence of the legislature that enacted the law, the law is a nullity—for example, when a State enacts legislation that falls within the exclusive competence of the Union. However, when a law is within the competence of the legislature that passed it and the unconstitutionality arises because the law is repugnant to provisions designed for the benefit of individuals, the law is not a nullity but merely unenforceable. In such circumstances, the unconstitutionality can be waived, rendering the law enforceable. Justice Aiyar referred to American authority, noting that the principle was well settled in the United States, and cited Cooley on Constitutional Limitations (Vol. 1, pp. 368‑371), Willis on Constitutional Law (1 [1955] 1 S.C.R. 613, pp. 653‑654, 524, 531, 542, 558) and Rottschaefer on Constitutional Law (pp. 28‑30). He further quoted several American decisions supporting his position and concluded that the same position must apply under our Constitution when a law contravenes a prescription intended for the benefit of individuals.

The Court observed that any individual whose rights have been infringed could elect to waive the infringement, and when such a waiver was effected, there was no legal obstacle to the enforcement of the statute in question. The Court added that the situation would be different if the statute were a nullity; a law that was a nullity could not be waived and could not be enforced. Consequently, where a law was merely unenforceable but could become operative upon waiver, it could not be described as non est or as erased from the statute book.

Mahajan, C. J., expressed a contrary view, which the Court reproduced in his own words: “We think that it is not a correct proposition that constitutional provisions in Part III of our Constitution merely operate as a check on the exercise of legislative power. It is axiomatic that when the law‑making power of a State is restricted by a written fundamental law, then any law enacted and opposed to fundamental law is in excess of the legislative authority and is thus a nullity. Both these declarations of unconstitutionality go to the root of the power itself and there is no real distinction between them. They represent but two aspects of want of legislative power. The legislative power of the Parliament and the State legislatures as conferred by Arts. 245 and 246 of the Constitution stands curtailed by the fundamental‑rights chapter of the Constitution.” The Chief Justice then referred to Article 13 of the Constitution and described it as a clear and unequivocal mandate of the fundamental law prohibiting the State from making any law that conflicted with Part III of the Constitution. He further stated: “In our opinion the doctrine of waiver enunciated by some American judges in construing the American Constitution cannot be introduced in our Constitution without a fuller discussion of the matter… Without finally expressing an opinion on this question, we are not for the moment convinced that this theory has any relevancy in construing the fundamental rights conferred by Part III of the Constitution. We think that the rights described as fundamental rights are a necessary consequence of the declaration in the preamble that the people of India have solemnly resolved to constitute India into a sovereign democratic republic and to secure to all its citizens justice, social, economic and political; liberty of thought, expression, belief, faith and worship; equality of status and of opportunity. These fundamental rights have not been put in the Constitution merely for individual benefit, though ultimately they come into operation in considering individual rights. They have been put there as a matter of public policy and the doctrine of waiver can have no application to provisions of law which have been enacted as a matter of constitutional policy.” The Court noted that Mahajan, C. J., advanced two principal reasons for his position. First, he maintained that the effect of Article 13 was to forbid the State from making any law that conflicted with Part III of the Constitution.

In that judgment, Mahajan, C. J., rejected the distinction drawn by Venkatarama Aiyar, J., between a legislature’s lack of power and the failure to observe procedural checks on that power. He held that both circumstances reflected a deficiency of legislative authority. He further supported his view by referring to the preamble and the overall design of Part III of the Constitution, arguing that the doctrine of waiver could not be applied to fundamental rights. The discussion began with an analysis of Article 13, which comprised two separate provisions. The first provision dealt with “all laws in force in the territory of India immediately before the commencement of this Constitution” and declared that any inconsistency of such laws with Part III would render them void to the extent of the inconsistency. The second provision concerned laws made after the Constitution came into force, stating that the State must not enact any law that takes away or abridges the rights guaranteed by Part III, and that any law contravening clause (2) of Article 13 would be void to the extent of that contravention. From these two clauses, Mahajan, C. J., concluded that the Constitution itself recognized a clear distinction: a law passed by an incompetent legislature would be wholly void, whereas a law enacted within the legislature’s competence but in violation of a constitutional limitation would be void only insofar as it conflicted with the limitation.

The language “to the extent of the inconsistency” and “to the extent of the contravention” reinforced this distinction, a point that had been emphasized in the unanimous decision of Bhikaji Narain Dhakras v. State of Madhya Pradesh (1). Earlier cases, including the decision in Kesavan Madhava Menon’s case (2), which Mahajan, C. J., heavily relied upon, had also addressed the same principle. The Court also examined the observations in Behram Khurshed Pesikaka (3) and noted that Article 13(1) could not be read as erasing an inconsistent law entirely from the statute book. Rather, such a law continued to operate for past transactions and for the enforcement of rights and liabilities that arose before the Constitution’s commencement, as held in Keshavan Madhava Menon’s case. The law remained effective for persons who were not citizens and therefore could not invoke the fundamental rights. Consequently, Article 13(1) merely nullified or rendered ineffective the portion of the law that conflicted with the fundamental rights, without annihilating the entire statutory provision.

In the Court’s reasoning, a law that existed before the Constitution and that had become inconsistent with Article 19(1)(g) read with clause (6) was described as ineffective, nugatory and lacking any legal force or binding effect for the exercise of the fundamental right after the Constitution’s commencement. The Court explained that every law, whether existing at the time of the Constitution’s coming into force or enacted thereafter, which is inconsistent with any provision of Part III of the Constitution, must, by the explicit language of Article 13, be declared void to the extent of that inconsistency. However, the Court stressed that such a law is not dead for all purposes; it may retain relevance for matters that do not fall within the ambit of the constitutional right. This view, originally articulated in Bhikaji Narain Dhakras v. State of Madhya Pradesh (1), was subsequently endorsed in a series of later judgments, including the decision in Muthia’s case (2). The same distinction was again highlighted in the unanimous decision of this Court in The State of Bombay v. R.M.D. Chamarbaugwala (3), where, at page 885, the Court quoted the Court of Appeal’s approach to assessing the validity of a statute. According to that approach, the first step is to determine whether the statute falls within the subject‑matter jurisdiction of the legislature that enacted it. If it does, the next inquiry is whether, for a law made by a provincial legislature that is now a State legislature, its operation extends beyond the territorial limits of that State, since legislative power is confined to the State’s territory unless a clear territorial nexus exists. Finally, if the law satisfies both the jurisdictional and territorial tests, the court must examine whether any other provision of the Constitution imposes a limitation on the legislature’s power. Only when the impugned law passes all three tests can it be upheld.

The Court then observed that the mere use of the term “void” in Article 13 does not automatically preclude the application of the doctrine of waiver to provisions of Part III of the Constitution. The Court drew an analogy with the United States Constitution, noting that under Article VI of that Constitution, any law enacted in violation of a constitutional guarantee is invalid because the Constitution and the laws made in pursuance of it constitute the supreme law of the land, as cited in (1) [1955] 2 S.C.R. 589, (2) [1955] 2 S.C.R. 1247 and (3) [1957] S.C.R. 874. Accordingly, the Court expressed its inability to accept the proposition that Article 13, by its use of the word “void,” completely bars the doctrine of waiver from being applied to the fundamental rights guaranteed in Part III. The Court indicated that it would now turn to a second line of reasoning, questioning whether any aspect of the Constitution’s preamble or its overall scheme, particularly with respect to Part III, would render the doctrine of waiver inapplicable.

In this case the Court first compared the preamble of the Indian Constitution with that of the Constitution of the United States of America. The Indian preamble begins with the words “We the people of India …” and proceeds to declare the resolve of the people to adopt a Constitution that assures the dignity of the individual and the unity of the nation. The American preamble, adopted in 1787, reads “We the people of the United States …” and enumerates the purposes of forming a more perfect Union, establishing justice, ensuring domestic tranquillity, promoting the general welfare, and securing the blessings of liberty. The Court noted that while the American preamble stresses the formation of a more perfect Union, justice, domestic tranquillity, general welfare and liberty, the Indian preamble places greater emphasis on the welfare state, justice, liberty, equality and fraternity. The Court then observed that the issue before it was limited to whether the doctrine of waiver could be applied to the provisions of Part III of the Indian Constitution. The Court found no wording in either preamble that would render the doctrine applicable in one case and inapplicable in the other. The Court next turned to a salient distinction between the two constitutions. It explained that the American Constitution of 1787, apart from enumerating the powers of the federal government and restricting the powers of the states, functions largely as an outline of government. Its articles are expressed in general terms and do not contain detailed specifications of organization or power, anticipating that subsequent legislation and interpretation would give effect to its provisions. In other words, the American Constitution was recognised early on as not being self‑executing. By contrast, the Indian Constitution is more detailed, and Part III not only defines fundamental rights but also specifies the extent to which those rights may be restricted in the interest of general welfare and other considerations. This reflects an attempt to balance individual rights with social good, and the limitations are themselves defined. Nevertheless, the Court held that this difference does not materially affect the question presently before it. Both the rights and the permissible restrictions are justiciable, and courts of competent jurisdiction are expected to interpret them. The Court further acknowledged that there is an underlying constitutional policy behind the provisions of Part III, just as there is a legislative policy behind statutory enactments. Ultimately, the Court concluded that the decisive issue is not whether a constitutional or legislative policy exists, but whether a particular provision is intended primarily for the benefit of

In this case the Court observed that a crucial question is whether a statutory or constitutional provision is intended primarily for the benefit of individual persons or for the benefit of the public at large. The Court noted that this distinction has been recognised in several earlier decisions. For illustration the Court referred to a typical statutory provision such as section 80 of the Code of Civil Procedure, which provides that no suit may be instituted against the Government or a public officer for an act done in official capacity until two months have elapsed after a written notice has been given. The Court acknowledged that a public‑policy reason underlies this provision, but also observed that the party for whose benefit the provision was made may, if the circumstances warrant, waive the notice requirement, and may even be estopped by his own conduct from pleading lack of notice. The Court cited the Privy Council’s observation in AL. AR. Villavar Chettiar v. Government of the Province of Madras (1), stating that there is no inconsistency between the proposition that the provisions of a section are mandatory and must be enforced by the court and the proposition that they may be waived by the authority for whose benefit they are provided. The Court then asked whether any provision in the statute expressly prevents the application of the doctrine of waiver to such a right, provided that the appropriate safeguards and precautions are observed and the right is for the benefit of individuals. The Court expressed awareness that rights characterised by the Constitution as fundamental must be treated with particular seriousness and that it would be erroneous to diminish those rights. However the Court cautioned against reducing fundamental rights by answering the question of waiver in the abstract with a blanket affirmative or negative answer. Instead, the Court held that the question of waiver must always depend on (a) the nature of the right guaranteed and (b) the foundation on which the plea of waiver is based. The Court reminded that the rights guaranteed by Part III of the Constitution are not limited to citizens; some rights extend to non‑citizens as well. Moreover, not every provision in Part III confers a right; some provisions define rights while others set out the restrictions or conditions subject to which those rights are granted. For example, Article 33 does not bestow any right on any person; rather, it empowers Parliament to modify the rights conferred by Part III in their application to persons. Similarly, Article 34 lays down conditions relating to the exercise of rights. Consequently the Court concluded that it is not entirely correct to say that every provision in Part III grants a fundamental right, even though the heading is “Fundamental Rights.” The Court proposed a three‑fold classification of rights: (1) a right granted by an ordinary statutory enactment; (2) a right granted by the Constitution; and (3) a right guaranteed by Part III of the Constitution.

In this discussion the Court observed that there is no difficulty in dealing with an ordinary statutory right because it is well‑recognised that a statutory right designed for the benefit of an individual may, in appropriate circumstances, be waived by the person for whose benefit the provision was made. Turning to constitutional rights, the Court pointed out that several provisions of the Constitution lie outside Part III yet nevertheless relate to certain rights; for example, the provisions concerning the services of the Union and the States are found in Part XIV. The Court expressed the view that it cannot be seriously contended that a right granted to a government servant for his own benefit is incapable of being waived by that servant, provided that no question of jurisdiction is involved. To support this view the Court referred to the provisions of Part XIII that deal with trade, commerce and intercourse within the territory of India, which impose specific restrictions on the legislative powers of the Union and of the States with respect to trade and commerce. Because those restrictions are for the benefit of the general public rather than for any particular individual, the Court held that they cannot be waived even though they do not appear in Part III. Consequently the Court stated that the essential enquiry is not whether a right or restriction occurs in one part or another of the Constitution, but rather what kind of benefit the right confers. The decisive test, according to the Court, is to ask whether the right is primarily for the benefit of individuals or for the benefit of the public at large. The source of the right, whether contractual, statutory or constitutional, is therefore not the determining factor. The doctrine of waiver rests on the principle that any right, statutory or otherwise, which is intended for an individual may be relinquished by that individual. The Court acknowledged that a right meant for the public will in its actual operation affect particular persons, just as a right for an individual will arise in relation to a specific person such as person A or person B. Thus the test is not merely whether the right operates on an individual, but whose benefit was the primary purpose of the grant – the public or the individual. Applying this test, the Court observed that the provisions of Part III have been grouped under several headings, namely the right to equality, the right to freedom, the right against exploitation, the right to freedom of religion, cultural and educational rights, the right to property and the right to constitutional remedies. It was clear that some of these rights are intended primarily for the general public; for instance, Article 23 prohibits traffic in human beings and Article 24 provides that no child below the age of fourteen shall be employed in hazardous work.

In this discussion, the Court observed that several provisions in Part III of the Constitution were primarily intended for the benefit of the public rather than for any individual. It gave the example of the prohibition against employing a child below fourteen years old in any factory, mine or other hazardous work, and noted that many other rights fell into the same category of public‑oriented guarantees. The Court then asked whether the same conclusion could be drawn with respect to every constitutional right.

To examine this question, the Court considered Article 31, which declares that no person could be deprived of his property except by authority of law, and that compulsory acquisition or requisition could occur only for a public purpose, with compensation provided by law. The Court imagined a situation in which a man’s property was acquired under a statute that failed to fix the amount of compensation or to specify the principles for determining it. In such a case, the man might nevertheless acquiesce to the Government’s taking of his land for a public purpose, even though the statute did not satisfy the compensation requirements. The Court asked whether, after a lapse of two or three years, that same man could change his mind, claim that the law was invalid, and demand the return of his land—perhaps a school or hospital had already been built—on the ground that he could not have waived his fundamental right. The Court expressed the view that a blanket statement that no fundamental right could ever be waived would lead to startling and unforeseen consequences.

The Court illustrated the point further with a second example involving a permit or licence, such as one for operating a motor‑vehicle or an excise shop. After enjoying the benefit of the permit for several years, the Court asked whether the holder could, when proceedings were initiated against him, argue that the law under which the permit had been granted was constitutionally invalid, and thereby seek to have the licence terminated on that basis. The Court warned that allowing such a defence would produce similar unexpected results if a general prohibition on waiving fundamental rights were applied.

Turning to Article 32, which provides the right to approach the Supreme Court for enforcement of the rights conferred by Part III, the Court noted that this right itself was settled as a fundamental right by numerous decisions. It presented a scenario in which a person exercised Article 32 by filing an appropriate petition to enforce a fundamental right, later withdrew the petition, and subsequently changed his mind again. The Court questioned whether that person could now contend that he could not have waived his Article 32 right and that the order permitting withdrawal of the petition was legally ineffective. By raising these hypothetical situations, the Court emphasized that an absolute rule against waiving any fundamental right would generate difficult and undesirable legal outcomes.

In this case, the Court considered whether a person may relinquish a fundamental right after having previously invoked it. The Court first posed a hypothetical involving Article 32, which guarantees the right to approach the Supreme Court for the enforcement of fundamental rights. It asked whether an individual who files a petition under Article 32 and later withdraws that petition could later claim that the withdrawal order is legally ineffective because he had waived his right. The Court then examined a second illustration concerning Article 30(1) of the Constitution, which confers on linguistic or religious minorities the right to establish and administer educational institutions of their choice. The Court imagined a minority‑run school that seeks government assistance. To obtain such aid, the minority might have to relinquish a portion of its administrative authority. The Court noted that a similar question had arisen in the advisory opinion on the Kerala Education Bill, wherein it was held that a minority may surrender part of its administration rights in order to receive government aid. The Court observed that if it were to rule that a minority can never surrender any part of its constitutional right, the minority would be unable to obtain any public assistance, an outcome the Court found unreasonable. The Court further stated that it sees no essential difference between the United States Constitution and the Indian Constitution that would justify applying the doctrine of waiver to rights protected by the American Constitution but not to those enshrined in Part III of the Indian Constitution. Speaking in general terms, the Court explained that Part III restrains the State—defined to include the Union government, Parliament, State governments, State legislatures, and all local or other authorities within the territory of India—from taking any action that infringes a fundamental right. The Court observed that the United States Constitution contains a similar principle, citing Article VI which declares that the Constitution and laws made in pursuance thereof constitute the supreme law of the land. The Court mentioned that American jurisprudence treats the first ten amendments as contemporaneous and to be interpreted together, and that many of those provisions use language comparable to that of Part III. The Court referred to the treatise Rottschaefer on Constitutional Law, pages 28‑29, for a concise statement of the American position, which the Court paraphrased: certain constitutional guarantees may be waived by the individual for whose protection they were intended, and a person who has waived such protection cannot later claim that his constitutional right has been violated, because any injury he suffers stems from his own waiver rather than from an unlawful governmental act.

In this discussion the Court explained that a person who would normally be allowed to raise a constitutional question may be prevented from doing so when he is estopped by his own prior conduct. The usual reason for such estoppel is that the person has acted in a way that contradicts his present claim, or has behaved in a manner that would make it unfair to let him avoid liability on constitutional grounds. The Court further stated that a person may not question the constitutionality of the very provision that forms the basis of the right he alleges to be violated, nor may he attack a provision that is an essential part of the definition or establishment of that right.

The Court noted that generally accepting a benefit under one clause of an Act does not stop a person from challenging the validity of another, separable clause of the same Act, although there are recognized exceptions. One exception occurs when promoters of a public improvement are barred from contesting the rule that distributes the cost of the improvement among the lands that benefit from it. Another exception applies when a person who has received the advantages of a statute later tries to invoke the statute’s invalidity in order to defeat the claims of those against whom the statute was enforced in his favour. The Court added that a state may be estopped from asserting that its own statute deprives it of property without due process, but the state remains free to argue that the statute infringes rights conferred on it by its constitution. Moreover, the Court clarified that previous inconsistent conduct will not stop a person from asserting the invalidity of an act if, under all the circumstances, making such an assertion does not cause unfairness or injustice to the parties against whom it is raised.

The learned Attorney General relied on several American decisions, namely Pierce v. Somerset Railway, Wall v. Parrot Silver and Copper Company, Pierce Oil Corporation v. Phoenix Refining Company, Shepard v. Barron, United States v. Murdock, Patton v. United States, and Adams v. United States. The Court observed that the American position on these matters is so well settled that a detailed examination of each case was unnecessary. Instead, the Court referred to the observations of Justice Frankfurter in the William A. Adams case, which concerned a trial held without a jury at the accused’s own request despite the guarantee of Amendment VI. Justice Frankfurter’s remarks were quoted as follows: “What was contrived as protections for the accused should not be turned into fetters. To assert as an absolute that a layman, no matter how wise or experienced he may be, is incompetent to choose between judge and jury as the tribunal for determining his guilt or innocence, simply because a lawyer has not advised him on the choice, is to dogmatize beyond the bounds of learning or experience.” The Court further stated that it could find no substantive reason why the American decisions on waiver and estoppel should be considered inapplicable to similar questions arising under the Indian Constitution.

The Court observed that the earlier discussion of American cases could not be automatically extended to cases arising under the Indian Constitution. It noted that two subsidiary reasons had been offered to support the view that the Indian constitutional position differed from the American one. The first subsidiary reason asserted that India was a nascent democracy and therefore the doctrine of waiver should not be applied. The Court respectfully declined to agree with that reasoning, stating that it could not accept that a nascent democracy precluded the use of waiver. The Court further expressed that converting a fundamental right into a fetter or using it as a means to escape a freely entered agreement would not advance democratic values. It recognized that waiver must not be applied lightly and must be employed only after observing the most stringent safeguards and cautions. However, the Court objected strongly to any absolute statement that a right guaranteed by any provision of Part III of the Constitution could never be waived under any circumstances. Another argument presented was that the provisions of Part III embodied “natural rights” that were retained by the people and could never be interfered with. The Court found itself unable to accept this contention, noting that the term “natural rights” was inherently vague and lacked precise definition. It explained that scholars sometimes distinguished natural rights from civil rights, describing natural rights as inherent or innate and derived from elementary laws of nature, while civil rights emerged from civil societal needs. The Court observed that no such distinction was evident in the text of Part III, because all the rights listed there appeared to have been created by the Constitution itself. Accordingly, it held that the doctrine of natural rights, as articulated by John Locke and influential in the American Declaration of Independence, did not influence the drafting of Part III provisions. The Court cited the scholar E. W. Paterson, who explained that the theory of natural rights derived from Locke lacked the characteristics of immutable physical order and divine reason that underlie natural law. The Court explained that in the absence of government, individuals would live in a “state of nature,” being free to work, enjoy their labour’s fruits, and trade. It further noted that such a condition would lack established law, an impartial magistrate, and sufficient power to enforce judgments, thereby justifying the need for governmental authority.

Locke described a condition of nature in which every person was free to work, to enjoy the fruits of his labour and to barter with others, and he also held that each individual could enforce the law of nature against any other person, although he did not define the precepts of that law. Because Locke was optimistic about human nature, he believed that people could get along reasonably well in such a law‑less state, but he regarded that condition as a fiction comparable to the assumption of a frictionless machine in physics. He identified three major disadvantages that would attend people in that state: the lack of an established law, the lack of an impartial magistrate to settle disputes, and the lack of a power capable of executing and enforcing the magistrate’s judgments. According to Locke, these inconveniences would compel men to form a social compact, whereby each would transfer to a third party, the government, those rights over his person and property that the government must possess in order to remove the inconveniences. All other rights, privileges and immunities would be retained, analogous to a landowner who conveys a fee simple to his son while reserving a life estate for himself. Locke labeled the retained rights as “natural” rights because they originated in the condition of nature and survived the social compact.

The Court observed that Part III of the Constitution contains clear indications that the doctrine of natural rights did not influence the drafting of its provisions. Articles 33, 34 and 35 expressly empower Parliament to modify the rights conferred by Part III; if those rights were truly natural, the Constitution could not have permitted such parliamentary amendment. Consequently, the Court held that the doctrine of natural rights offers no stable foundation for a thesis that the doctrine of waiver is inapplicable to the rights guaranteed in Part III. The Court articulated its view that a constitutional right or privilege that rests in the individual, is primarily for his benefit and does not infringe upon another’s right, may be waived provided the waiver is not prohibited by law and does not contravene public policy or public morals. In the present case, the Court found no factual basis to sustain the plea of waiver and therefore allowed the appeal with costs. It set aside the order of the Commissioner of Income‑Tax, Delhi, dated 29 January 1958, and quashed all proceedings pending for implementation of the Union Government’s order dated 5 July 1954.

Justice Subba Rao noted that he had carefully read the judgments of the Chief Justice and of Justice S. K. Das. While he agreed with their conclusions, he chose to express his own opinion separately on the applicability of the waiver doctrine to fundamental rights. He recognized that the case presented a serious and important question concerning whether the doctrine of waiver operates upon the fundamental rights enshrined in the Constitution, a question of general public importance that could arise frequently.

In this case the Court was asked to consider whether the legal doctrine of waiver can be applied to the fundamental rights that are protected by the Constitution. The issue was not limited to the narrow circumstances of the present dispute; rather, it was a question of general importance that could affect the public at large. Because the matter is likely to arise repeatedly, the Court observed that the differing comments that have already been made by various Judges could lead to inconsistent rulings, which would cause unnecessary litigation and could impose avoidable hardship on parties. The matter was directly presented before the Court and was the subject of full argument. On these facts the Court could not agree with the view expressed by the learned brother, Justice S. K. Das, that the Court should refrain from deciding the question and should wait for a more suitable case to address it. The factual background had already been set out in detail by the Chief Justice in his judgment, and there was no need to repeat those facts. The Attorney General argued that, under American law, the principle of waiver had been applied to constitutional rights except where the protection of those rights was grounded in public policy. By analogy, he suggested that where no public policy consideration was involved, a person in India could also waive a constitutional protection that had been infringed. He further contended that in the present proceedings the appellant had waived his fundamental right under Article 14 of the Constitution because that right related solely to his tax liability and therefore could be lawfully relinquished. To evaluate this submission, the Court first examined the American approach to the subject. In the United States, certain rights—often referred to as the Bill of Rights—were added to the Constitution by amendments. Those amendments enumerate freedoms such as religion, speech, press, assembly and protection against unlawful seizure. They also guarantee trial by jury in specified criminal and civil cases and protect individuals from self‑incrimination. The Fifth Amendment provides that no person shall be deprived of life, liberty or property without due process of law, and that private property may not be taken for public use without just compensation. The Fourteenth Amendment extends the requirement of due process as a safeguard against actions of the State. These amendments were designed to shield citizens from arbitrary action by the Union or the States. Although the language of the rights is broad, the United States Supreme Court, through an extensive series of judicial interpretations that took account of the nation’s social conditions, has given concrete meaning to those rights and has placed limitations on them in order to balance individual liberty with the public good. In doing so, the Court has developed counterbalancing doctrines such as police power and eminent domain, among others. As the law developed, American courts attempted to apply the doctrine of waiver to constitutional provisions. The courts applied this doctrine very cautiously, formulating clear principles to determine when a constitutional right could be voluntarily relinquished.

The source referred to as “same” laid down definite principles that were extracted from various decisions and were clearly summarized in authoritative textbooks on American constitutional law under distinct headings.

In the work titled Willis on Constitutional Law, the following principles were enumerated. First, the privilege against self‑incrimination, like any other privilege, may be waived by the individual. Second, the protection against double jeopardy is also a privilege that can be waived, either expressly or by implication. Third, the immunity from unreasonable searches and seizures is described as a privilege that may be relinquished; consent by the individual can render a search and seizure reasonable. Fourth, regarding the right to a jury trial, the United States Supreme Court observed that the matter did not involve a jurisdictional question nor the interest of the State, but concerned only the privilege and right of the accused, and that such privilege is subject to waiver in accordance with the ordinary rules governing waivers. Fifth, the Court explained that due process of law is a matter of jurisdiction: when a governmental branch seeks to limit personal liberty by exercising social control, it must possess jurisdiction; lacking jurisdiction would amount to taking life, liberty, or property without due process, a rule that admits no exceptions and therefore cannot be waived.

In Cooley’s Constitutional Limitations, it is stated that when a constitutional provision is designed solely to protect the property rights of a citizen, that citizen is competent to waive the protection and to consent to an action that would otherwise be invalid if undertaken against his will. However, in criminal cases the doctrine that a constitutional privilege may be waived is limited to a very narrow extent. While a party may consent to waive property‑related rights, the trial and punishment for public offences do not fall within the sphere of individual consent or agreement.

The commentary in Corpus Juris Secundum, citing a note on page 1050, asserts that the doctrine of waiver extends to rights and privileges of any character because the term “waiver” encompasses every conceivable right. Consequently, the general rule is that a person may waive any matter that affects his property, any alienable right or privilege of which he is the owner or to which he is legally entitled, whether such right arises from contract, statute, or the Constitution. This waiver is permissible provided the right in question rests solely with the individual, is intended for his sole benefit, does not infringe upon the rights of others, and is not prohibited by law or contrary to public policy. The principle is recognized that everyone has the right to waive, and to agree to waive, the advantage of a law or rule created solely for the benefit and protection of the individual in his private capacity, provided that such relinquishment does not infringe any public right and does not cause detriment to the community at large.

As a general rule, rights relating to procedure and remedy are subject to waiver, but if a right is so fundamental that it is integral to the established processes of the administration of justice, it cannot be waived by anyone.

Fundamental rights that are essential to the administration of justice and have been integral to the legal system for ages cannot be waived by any individual. The decisions cited illustrate this principle. The doctrine was applied to contractual obligations in Pierce v. Somerset Railway (1); to the deprivation of property without due process in Pierce Oil Corporation v. Phoenix Refining Company (2) and Shepard v. Barron (3); to the right to trial by jury in Patton v. United States (4) and Adams v. United States (5); and to the privilege against self‑incrimination in United States v. Murdock (6). Although, as the counsel for the appellant observed, some of the pronouncements in those cases were obiter, they nevertheless reveal a consistent trend in American judicial opinion. (1) (1898) 43 L.Ed. 316; 171 U.S. 641. (2) (1922) 66 L.Ed. 855; 259 U.S. 125. (3) (1904) 48 L.Ed. 1115; 194 U.S. 553. (4) (1930) 74 L.Ed. 854; 281 U.S. 276. (5) (1942) 87 L.Ed. 268. (6) (1931) 76 L.Ed. 210; 284 U.S. 141.

The American approach can be summed up as follows: a waiver is permissible when the constitutional or statutory guarantee of a right is not conceived in the public interest or when the waiver does not interfere with the jurisdiction of the authority alleged to have infringed the right. Conversely, if a statute confers a privilege that is intended solely for the benefit of an individual, that individual may relinquish it. Nevertheless, courts consistently caution that, given the nature of such rights, strict and careful conditions must be satisfied before applying the waiver doctrine. This raises the question of whether the fundamental rights enshrined in the Indian Constitution belong to the class of rights that can be waived. In other words, does the constitutional guarantee of fundamental rights limit or remove the authority of the State to enact legislation that derogates from those rights, or are those rights designed primarily for the general public’s benefit? At the outset, a word of caution is appropriate. While judgments of the United States Supreme Court are highly instructive for this Court in addressing complex issues, it is essential to remember that those decisions arise from a different social, economic and political milieu. Accordingly, great care must be exercised in applying American precedents to Indian cases, because the divergent conditions may lead to different outcomes.

In this case the Court observed that it is essential to examine the character of the fundamental rights that are embodied in the Constitution of India, the circumstances of the people for whose benefit those rights were enacted, the purpose for which they were instituted, and the impact of any legislation that infringes those rights. The preamble of the Constitution declares that it will secure to every citizen justice, social, economic and political liberty, freedom of thought, expression, belief, faith and worship, equality of status and opportunity, and will foster fraternity, dignity of the individual and national unity. To realise these objectives the Constitution incorporated a chapter of fundamental rights, which are classified into seven groups: the right to equality (Articles 14‑18), the right to freedom (Articles 19‑22), the right against exploitation (Articles 23‑24), the right to freedom of religion (Articles 25‑28), cultural and educational rights (Articles 29‑30), the right to property (Articles 31, 31A and 31B), and the right to constitutional remedies (Articles 32‑35). The Court noted that Patanjali Sastri, J., in Gopalan v. State of Madras (1), explained that the rights in Part III remain with the people even after the people have delegated authority to the central and state governments created by the Constitution.

The Court then reproduced the text of Article 13, which provides that: (1) any law that was in force in the territory of India immediately before the Constitution and that is inconsistent with the provisions of Part III shall, to the extent of the inconsistency, be void; and (2) the State shall not enact any law that takes away or abridges the rights conferred by Part III, and any law made in contravention of this clause shall, to the extent of the contravention, be void. The Court emphasized that this provision unequivocally declares that pre‑existing laws and any later statutes that diminish the rights guaranteed in Part III are void to the degree of the inconsistency, and it also bars the State from making any law that would curtail those rights. Consequently, Part III was enacted for the benefit of all citizens of India, aiming to protect their fundamental rights from infringement by the institutions established under the Constitution; without such protection the goals outlined in the preamble could not be achieved. For the same reason, the chapter imposes a limitation on the State’s power to legislate in a manner that violates those rights. The Court concluded that the entire Part III was introduced in the public interest and it would be inappropriate to dissect the rights created under the various articles to determine which portions are of public concern and which are for individual benefit, as reflected in the judgment citation [1950] S.C.R. 88.

In this case, the Court observed that Part III of the Constitution was enacted in the public interest, while some provisions also serve individual benefit. Part III therefore embodies the effort of the Constitution‑makers to balance personal liberty with the authority of the State. The Court contrasted the Indian approach with that of the United States, noting that in the United States the balance between freedom and State control has been developed gradually through judicial decisions. In India, by contrast, both the fundamental rights and the limits on those rights are expressly set out in the Constitution itself, leaving little room for the judiciary to expand or contract those limits beyond what the text provides. Consequently, the Court held that it could not add any new restriction on the fundamental rights by invoking a doctrine such as “waiver” or any similar principle. The Court therefore concluded that the fundamental rights contained in Part III cannot be waived by a citizen. The Court acknowledged an argument that a rigid rule against waiver might, in some situations, frustrate the purpose for which the fundamental rights were created. After a careful examination of each article in Part III, the Court found no indication that any of the provisions create an absurd result or impose an unreasonable hardship on the people for whose benefit the rights were fashioned. Article 14, the Court said, enshrines the well‑known principle of equality before the law and equal protection of the laws. Articles 15, 16, 17, 18 and clause 29(2) apply that principle to specific contexts. The Court explained that the underlying principle of these articles is the foundation of India’s democratic system and guarantees citizens equal protection in both substantive and procedural matters. The Court further reasoned that if the doctrine of waiver were grafted onto these core principles, it would allow a citizen to consent to discrimination. Considering the unequal power relationship between the State and an ordinary citizen—especially in a country where illiteracy is widespread—the Court found it easy to imagine a scenario in which a citizen, out of fear of coercion or in hope of preferential treatment, might surrender his right. Although the law permits proof of coercion or undue influence, the Court observed that demonstrating such pressure in a courtroom would be practically impossible. The same line of reasoning was said to apply to Articles 15 and 16. Regarding Article 17, the Court pointed out that the doctrine of waiver would have a particularly harmful effect, because Article 17 expressly abolishes untouchability; a person cannot ask the State to treat him as an untouchable. Finally, the Court reproduced the text of Article 19(1), which provides that every citizen has the right to (a) freedom of speech and expression; (b) to assemble peaceably and without arms; (c) to form associations or unions; (d) to move freely throughout the territory of India; (e) to reside and settle in any part of India; (f) to acquire, hold and dispose of property; and (g) to practice any profession, or to carry on any occupation, trade or business.

The Court observed that the right to freedom constitutes an essential attribute of a citizen in a democratic system, and that the freedoms enumerated in Article 19 are subject only to the restrictions expressly provided in clauses (2) to (6) of that Article. It further stated that, with respect to each of the freedoms listed in sub‑clauses (a) through (g) of clause (1) of Article 19, it could not imagine any circumstance in which a citizen would be placed in a worse position by being unable to exercise a waiver of those rights. In particular, the Court considered the freedom to acquire, hold and dispose of property and acknowledged that one might advance a plausible argument that a citizen should be permitted to waive that right so as to avoid being compelled to acquire or retain property against his intention. The Court rejected that line of reasoning, explaining that the constitutional provision does not oblige a citizen to acquire, hold or dispose of property, just as it does not oblige a citizen to engage in any of the other activities protected by the remaining freedoms. Accordingly, if a person chooses not to reside in any part of the territory, not to speak, or not to practice a profession, he remains free to abstain from those acts. Similarly, a person who wishes to acquire property or practice a profession cannot later be told that he had previously waived that right; the freedom to perform an act necessarily includes the freedom to refrain from it.

The Court further clarified that a clear distinction exists between the non‑exercise of a right and the exercise of a right subject to the doctrine of waiver, and that even with respect to the right covered by sub‑clause (f) of clause (1), no situation could arise in which a citizen would be disadvantaged compared with a scenario in which he possessed no fundamental rights under the Article. It held that preserving the rights under Article 19 without imposing any additional limitations beyond those already found in the Constitution serves the public interest, because these rights are vital to the development of human personality in its various dimensions. Addressing a comment on the right covered by clause (3) of Article 20, the Court noted that the argument suggesting a person could not give evidence voluntarily if he were unable to waive the protection under that clause was misguided. It emphasized that the essential content of clause (3) is that a person must not be compelled to be a witness against himself; this restriction does not prevent him from offering evidence of his own choosing. Finally, the Court referenced Article 21, reminding that no person shall be deprived of life or personal liberty except in accordance with the procedure established by law.

In this case, the Court observed that Article 22 of the Constitution provides protection against arrest and detention in certain circumstances and that no conceivable situation exists in which a person could waive that protection for his own advantage. The Court further noted that Article 23(1) forbids traffic in human beings and forced labour, and that the Constitution does not permit a person to waive this protection. Similarly, the Court held that the right under Article 24, which bans the employment of children in factories, cannot be waived because a child is incapable of relinquishing his own constitutional right. Regarding Article 25, the Court explained that it guarantees religious liberty subject to specific restrictions, declares that all persons are equally entitled to freedom of conscience, and to freely profess, practise and propagate religion. The Court emphasized that this right is conceived in the public interest and therefore cannot be waived. The Court added that freedoms relating to the management of religious affairs, the payment of taxes for the promotion of any particular religion, and attendance at religious instruction or worship in certain educational institutions are all intended to enforce the State’s religious neutrality and likewise cannot be said to be non‑public‑interest matters.

The Court then turned to the cultural and educational rights of minorities, noting that these rights, including the right to establish and administer educational institutions of their choice, are provided for the protection of minorities and therefore serve the public interest. Concerning Article 31, which prohibits the State from depriving a person of his property except by authority of law and from acquiring property without compensation, the Court explained that this provision is designed to shield individuals’ property from arbitrary State action. The Court rejected the suggestion that a person might waive his fundamental right to property, allow the State to incur heavy expenditure in improving that property, and subsequently claim the property back, arguing that such a scenario should not arise because the State is not authorised to take or deprive citizens of property except in accordance with law. The Court further observed that if a property owner wishes to convey his property to the State, the State can insist on a legal conveyance, and that other remedies—such as claims for compensation or damages for bona‑fide improvements or losses—may be available depending on the facts of each case. The Court concluded that these considerations are irrelevant to the question of waiver in the context of fundamental rights. Finally, the Court reiterated that by express constitutional provisions, the State is prohibited from making any law that takes away or abridges the rights conferred by Part III of the Constitution, and therefore the State cannot enforce a right contrary to the constitutional prohibition on the ground that a party has waived his fundamental right.

The rights that are conferred by Part III of the Constitution may not be enforced by the State in a manner that contravenes the constitutional prohibition, even if a party to a dispute alleges that he has waived his own fundamental right. In other words, the State is not entitled to rely on a claim of waiver in order to enforce a right that the Constitution itself forbids it to enforce. When this constitutional prohibition is kept in mind, no situation can arise in which the State suffers prejudice because of a waiver argument. Any prejudice that might be said to affect the State would not be the result of the non‑application of the doctrine of waiver; rather, it would stem from the State’s own conduct that is contrary to the constitutional ban placed upon it. It has been suggested that, if the doctrine of waiver were to be excluded, a person could file an application under Article 32 of the Constitution before the Supreme Court, obtain a dismissal of that application, withdraw the petition, secure an order of dismissal from the Supreme Court, and then file a fresh writ petition concerning the same right. The Court regarded that apprehension as more imaginary than real because it lacks any factual or legal foundation. Once an application is dismissed—whether the dismissal is on the merits or on a preliminary ground—the order of the Court becomes final, and it may be reopened only in the manner that is prescribed by law. Consequently, there is no room for the doctrine of waiver to operate in such a circumstance. Articles 33 and 34 of the Constitution impose certain limitations on the application and enforcement of fundamental rights. Article 33 authorises Parliament to modify the rights guaranteed by Part III when they are applied to particular facts, and Article 34 permits Parliament to impose restrictions on those rights when martial law is in force in any area. These two articles therefore do not create new fundamental rights; they merely impose limitations on existing rights, and the Court could not accept the argument that their inclusion in Part III either diminishes the content of the fundamental rights declared therein or sustains the doctrine of waiver in relation to those rights. Article 35 confers on Parliament the power to legislate for giving effect to the provisions of Part III, to the exclusion of the legislatures of the States. This article also does not create a fundamental right; instead, it provides a mechanism for enforcing the right. A striking consequence, it has been argued, would follow from rejecting the doctrine of waiver, and that consequence was illustrated by an example: a person obtains a permit from the State for several years to operate a motor vehicle or an excise shop. After enjoying the benefit of the permit for a number of years, the State proposes to terminate the licence, and the permit‑holder contends that the law under which the permit was issued infringes his fundamental rights and is therefore constitutionally invalid. The question raised is whether the permit‑holder may claim that the very statute that granted the permit is invalid in law. The Court considered this illustration in the context of its analysis of the doctrine of waiver.

In the illustration presented, there is no inconsistency arising from the situation described. A person may either operate a motor vehicle or an excise shop with a licence or without one. If the law authorising the licence is valid, the individual obtains the licence and conducts the business under its authority. Should that same law later be found to offend a fundamental right and consequently be held void, the person would simply continue the activity without a licence, because a valid law would no longer require a licence. Hence the example does not create any paradox, and even if it were to do so, it would not alter the legal position involved.

The Court examined the various constitutional provisions relating to fundamental rights to determine whether, without invoking the doctrine of waiver, a citizen could be placed in a worse situation than if he had exercised his right. The examination revealed no such justification. Moreover, there is no basis for claiming that the State would suffer irreparable damage under certain circumstances; any hardship would be self‑inflicted and could be avoided by proper adherence to the law. Considering that a large segment of the population is economically poor, educationally backward, and not yet fully aware of their rights, individuals or groups cannot realistically confront State institutions on equal footing. In such circumstances, the Court has a duty to protect the rights of these persons even from themselves. Consequently, the Court held without hesitation that the fundamental rights enshrined in the Constitution are transcendent, conceived in the national and public interest, and therefore cannot be waived. In addition, the Court observed that Section 5(1) of Act XXX of 1947 had been declared void in the case of M. Ct. Muthiah v. The Commissioner of Income‑Tax, Madras, and therefore the appellant could not, by invoking the doctrine of waiver, validate the enquiry conducted under that provision. The argument that a distinction exists between a law beyond legislative competence, which is null and void, and a law unconstitutional on constitutional limitation grounds, which is merely unenforceable and could be revived by amendment, was rejected. The Court could not accept the contention that, because Section 5(1) was invalidated on the ground of violating Article 14, the law remained on the statute book and the appellant was thus entitled to waive his constitutional guarantee. The scope of Article 13(1) was deemed relevant to this conclusion.

In the earlier decision of Keshavan Madhava Menon v. State of Bombay, the Court examined the scope of Article 13(1) of the Constitution. By a majority, it held that Article 13(1) did not render existing laws that conflicted with fundamental rights void from the outset; rather, it made such laws unenforceable and void only with respect to the exercise of the fundamental rights on and after the commencement of the Constitution. Chief Justice Mahajan, who participated in that judgment, explained the meaning of the word “void” in Article 13(1) in Behram Khurshed Pesikaka v. State of Bombay, quoting at page 652: “It is axiomatic that when the law‑making power of a State is restricted by written fundamental law, then any law enacted and opposed to the fundamental law is in excess of the legislative authority and is thus a nullity. Both these declarations of unconstitutionality go to the root of the power itself and there is no real distinction between them. They represent but two aspects of want of legislative power. The legislative power of Parliament and the State Legislatures as conferred by Arts. 245 and 246 of the Constitution stands curtailed by the fundamental rights Chapter of the Constitution.” This passage made clear, in unequivocal terms, that no principled distinction could be drawn between constitutional incompetency and constitutional limitation; in either scenario the statute was void, although in the case of limitation the pre‑constitutional rights and liabilities created under the statute were preserved. The Court revisited the definition of “void” in Bhikaji Narain Dhakras v. State of Madhya Pradesh, where the issue was whether an Act declared void on the ground of inconsistency with the Constitution could be revived by a subsequent constitutional amendment removing the inconsistency. The Court answered affirmatively. Acting Chief Justice Das observed at page 598: “As explained in Keshavan Madhava Menon’s case, the law became void not in toto or for all purposes or for all times or for all persons but only to the extent of such inconsistency that is to, say, to the extent, it became inconsistent with the provisions of Part III which conferred the fundamental rights on the citizens. It did not become void independently of the existence of the rights guaranteed by Part III… In short, Article 13(1) had the effect of nullifying or rendering the existing law which had become inconsistent with Art. 19(1)(g) read with clause (6) as it then stood ineffectual, nugatory and devoid of any legal force or binding effect only with the exercise of the fundamental right on and after the date of the commencement of the Constitution… It is only as against the citizens that they remained in a dormant or moribund condition. In our judgment, after”

The Court observed that after the amendment of clause (6) of Article 19 on 18 June 1951, the statute that was being challenged ceased to be unconstitutional and was revived so that it could be enforced against both citizens and non‑citizens. The judgment did not depart from the principles laid down in Keshavan Madhava Menon’s case (1) and it did not disagree with the view expressed by Mahajan, C. J., in Behram Khurshed’s case (2). The issue that the Judges faced in the present matter was different, and they resolved it by applying the doctrine of “eclipse”. The Court stressed that the earlier rulings that a law declared void because of legislative incompetence or constitutional limitation remains void are unchanged by this decision. As long as the inconsistency between the statute and a fundamental right exists, the law continues to be void in respect of that fundamental right. The Court clarified that it was not concerned with any doctrine of revival, because the inconsistency of section 5(1) of the Act with the fundamental right guaranteed by Article 14 of the Constitution had not been removed by any constitutional amendment. Consequently, while that inconsistency persisted, section 5(1) remained void and could not affect the fundamental rights of citizens.

In the earlier decision of M. Ct. Muthiah v. The Commissioner of Income‑Tax, Madras (3), the Court had declared that section 5(1) of Act XXX of 1947 was unconstitutional on the ground that it infringed the citizens’ fundamental right under Article 14 of the Constitution. The Court cited (1) [1951] S.C.R. 228, (2) [1955] 1 S.C.R. 613 and (3) [1955] 2 S.C.R. 1247. Under Article 141, a ruling of the Supreme Court is binding on all Indian courts. Accordingly, the Income‑Tax Commissioner had no jurisdiction to continue proceedings against the appellant under Act XXX of 1947, and the appellant could not create jurisdiction for the Commissioner by waiving his own right. The scope of the doctrine of waiver had earlier been examined by this Court in Behram Khurshed’s case (1). In that case, a person had been prosecuted under section 66(b) of the Bombay Prohibition Act and sentenced to one month’s rigorous imprisonment. A question arose whether prosecution under section 13(b) of the same Act, which had been declared void by Article 13(1) insofar as it dealt with the consumption or use of liquid medicinal or toilet preparations containing alcohol, could be maintained. The Court held that once the Supreme Court declares a law unconstitutional, no Court may give it any effect because it ceases to be law and becomes null and void. Although the accused argued that he had waived his fundamental right, Mahajan, C. J., delivering the majority judgment, rejected that contention.

The learned Attorney General, when questioned about the doctrine of waiver, did not appear particularly enthusiastic about it. The Court, without finally expressing an opinion on the doctrine, stated that it was not presently convinced that this theory had any relevance in construing the fundamental rights conferred by Part III of the Constitution. The Court explained that the rights described as fundamental are a necessary consequence of the declaration in the preamble that the people of India have solemnly resolved to constitute India into a sovereign democratic republic and to secure to all its citizens justice, social, economic and political liberty, liberty of thought, expression, belief, faith and worship, as well as equality of status and opportunity. It emphasized that these fundamental rights were not inserted in the Constitution merely for the benefit of individuals, although they ultimately operate in relation to individual rights; rather, they were placed there as a matter of public policy. Consequently, the doctrine of waiver could not be applied to provisions of law that had been enacted as part of that constitutional policy. The Court pointed to articles such as Articles 15(1), 20 and 21 to make the proposition clear, noting that a citizen could not obtain discrimination by telling the State “you may discriminate,” nor could he be convicted by waiving the protection granted under Articles 20 and 21. Regarding the question of waiver, Justice Venkatarama Aiyar, in his judgment before review, examined American decisions and was inclined to hold that, under the Constitution, a law that contravenes provisions intended for the benefit of the individual could be waived. However, he clarified that the waiver issue did not pertain to any factual question in that case; it was relevant only for illustrating the nature of the right declared under Article 19(1)(f) and the legal effect of a statute that conflicted with it. Justice Das, then delivering a dissenting judgment, did not articulate his view on the waiver question but expressly reserved it, stating that while he largely agreed with Justice Aiyar on part of the case, he wished to avoid being understood as agreeing with the remainder of Aiyar’s observations, especially those concerning the waiver of unconstitutionality, the notion that fundamental rights are merely a check on legislative power, or the effect of the declaration under Article 13(1) being relatively void. He expressly declined to express an opinion on those topics at that time. The Court respectfully agreed with the observations of Mahajan, C.J. For the reasons outlined, it held that the doctrine of waiver has no application in the context of fundamental rights under the Constitution. Accordingly, the appeal was allowed, the order of the Income Tax Commissioner, Delhi, dated 29 January 1958 was set aside, and all proceedings pending for implementation of the Union Government order dated 5 July 1954 were quashed. The appellant was awarded costs of the appeal.

The Court declared that any legal proceedings that were then awaiting execution of the Union Government’s order dated 5 July 1954 were to be terminated. By issuing this order, the Court effectively nullified those pending actions and prevented any further steps toward implementing the earlier governmental directive. In addition, the Court ordered that the appellant receive the costs incurred in pursuing the appeal, thereby awarding the appellant reimbursement for the expenses associated with the appeal process.