Sardar Govindrao And Others vs State Of Madhya Pradesh

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

Court: Supreme Court of India

Case Number: Civil Appeal No. 182 of 1964

Decision Date: 6 October 1964

Coram: M. Hidayatullah, K.N. Wanchoo, Raghubar Dayal, J.R. Mudholkar

In the matter titled Sardar Govindrao and Others versus State of Madhya Pradesh, judgment was delivered on 6 October 1964 by the Supreme Court of India. The opinion was authored by Justice M. Hidayatullah and was read by a bench consisting of Justices M. Hidayatullah, K. N. Wanchoo, Raghubar Dayal and J. R. Mudholkar. The case is reported in the 1965 volume of the All India Reporter at page 1222 and in the 1965 Supreme Court Reports (Series 1) at page 678. Subsequent citator references include reports 1967 SC 1606, 1971 SC 1599, 1977 SC 567, 1977 SC 740, and 1982 SC 1201.

The dispute arose under the provisions of the Central Provinces and Berar Revocation of Land Revenue Exemptions Act, 1948, specifically section 5. Section 5(3) of that Act provided that descendants of former ruling chiefs, who had lost their land‑revenue exemption, were entitled to apply for a monetary grant or a pension. The appellants were the descendants of a former ruling chief whose exemption had been removed by the operation of section 3 of the same Act. They submitted applications for a pension and/or a monetary grant pursuant to section 5. The State Government rejected their applications without recording any reasons for the refusal.

Consequently, the appellants instituted a writ petition under article 226 of the Constitution before the High Court of Madhya Pradesh. The High Court held that the power to grant a pension was entirely discretionary in the hands of the Government and therefore dismissed the writ as incompetent. On appeal before the Supreme Court, the appellants argued that a refusal without reasons amounted to a failure to make a decision, and that when the statutory conditions for granting a pension were satisfied, the State Government was obligated to make the grant.

Representing the State Government, counsel relied upon the language of section 5(2), which states that after an enquiry into the applications the Government “may pass such orders as it deems fit,” and also on the apparently permissive term “may” used in section 5(3). The Court examined these provisions carefully. It held that subsection (2) and subsection (3) of section 5 must be interpreted separately. Under subsection (2) every application for a grant of money or pension had to be considered, and the Government could deal with the applications in various ways. Although the subsection used the word “may,” the Court observed that the provision only empowered the Government to pass orders that were appropriate to the occasion. In contrast, subsection (3) dealt specifically with special classes, such as religious and charitable institutions and descendants of ruling chiefs, and therefore modified the scope of discretion.

The Court noted that the rules distinguished between the two subsections because subsection (3) required special enquiries for the classes it covered. When a condition precedent was satisfied, the enabling provision acquired a compulsory character, making the grant of a monetary pension obligatory on the Government despite the discretionary language in subsection (2). Accordingly, the Court concluded that the word “may” in subsection (3) must be read as imposing a duty to grant, except where the Government had good grounds to refuse.

In the analysis of the statutory language, the Court observed that, except where there were clear grounds for refusing a pension, the Government was obligated to grant a pension to every applicant who satisfied the prescribed conditions; consequently, the word “may” in the third sub‑section, although it seemed to confer discretion, was to be interpreted as meaning “must.” The Court cited Maxwell on Interpretation of Statutes for this principle. The Court further held that, when passing orders on the appellants’ applications, the Government was required to act in a quasi‑judicial manner. The appellants were therefore entitled to a reasonable opportunity to present their case and to be informed of the reasons for any rejection of their claim, a proposition supported by reference to M/s. Hari Nagar Sugar Mills Ltd. v. Shyam Sundar Jhunjhunwala and Others (1962) 2 S.C.R. 339. Accordingly, the Court set aside the order of the State Government. The judgment concerned a civil appeal filed under special leave, identified as Civil Appeal No. 182 of 1964, which challenged a judgment and order dated 20 April 1959 of the Madhya Pradesh High Court in Miscellaneous Petition No. 325 of 1955. The appellants, who asserted descent from former ruling chiefs of the Hoshangabad and Nimar districts of Madhya Pradesh, sought a grant of money or pension under the Central Provinces and Berar Revocation of Land Revenue Exemptions Act, 1948, claiming it as appropriate maintenance. Under that Act, any estate, mahal, village or land previously exempted from whole or part land‑revenue liability by a special grant, contract with the Crown, or any law or rule then in force became liable for land revenue from the fiscal year 1948‑49, irrespective of any earlier exemption. The appellants owned estates in the two districts under favourable tenures as Jahgirdars, Maufidars and Ubaridars, enjoying a collective land‑revenue exemption of Rs 27,828‑5‑0 per annum. The enactment removed that exemption, and the appellants claimed entitlement to the money or pension provided for in the Act. They filed an application with the Deputy Commissioner, who forwarded it to the State Government. The State Government rejected the petition by order No. 993/XVI‑4 dated 26 April 1955 without stating any reasons. Consequently, the appellants instituted a petition under Article 226 of the Constitution in the High Court of Madhya Pradesh, seeking a writ of certiorari to quash the State Government’s order. In their petition, identified as LlSup./65‑18, they argued that the refusal, made without any reasons, amounted to no decision at all and constituted an improper and illegal exercise of the power vested in the State Government.

The State Government argued that it acted under section 5 of the Act and that the appellants could not claim any entitlement because they were not descendants of a former ruling chief; it further maintained that its exercise of the power conferred by section 5 was proper and lawful. The High Court examined the petition before a Full Bench, and the learned Chief Justice, delivering the judgment on behalf of that Bench, held that the Provincial Government was under no obligation to award either a monetary grant or a pension. The bench explained that the power to grant under section 5 was discretionary, and consequently the petition filed under article 226 was deemed incompetent. No other issues were addressed by the High Court, even though the Act barred a civil suit and a writ petition under article 226 appeared to be the sole remedy if the Provincial Government failed to act in accordance with the statutory provisions or acted illegally. The Court noted that the Act comprises eight sections. Section 3, which has already been discussed in this judgment, revokes the exemption from liability for land revenue and also refers to lands in Berar governed by the Berar Land Revenue Code and lands in Madhya Pradesh governed by the Central Provinces Land Revenue Act, 1917, specifying the classes of such lands and the special rules applicable to them. The present appeal does not require a detailed discussion of those provisions, and they may be set aside. Section 4 makes the necessary amendments to the Central Provinces Land Revenue Act, 1917 and to the Berar Land Revenue Code in consequence of the provisions of section 3; the Court indicated that it need not reproduce those amendments. Section 5 provides the mechanism for awards of money, grants or pensions. Sub‑section (1) allows any person adversely affected by section 3 to apply to the district Deputy Commissioner for a grant, money or pension. Sub‑section (2) requires the Deputy Commissioner to forward the application to the Provincial Government, which may pass such orders as it deems fit. Sub‑section (3) authorises the Provincial Government to make a grant of money or pension either (i) for the maintenance or upkeep of a religious, charitable or public institution or similar service, or (ii) for suitable maintenance of any family descended from a former ruling chief. Sub‑section (4) declares that any amount sanctioned under this section shall be charged on the revenues of the Province. Section 6 bars the jurisdiction of civil courts, while section 8 empowers the Provincial Government to make rules for implementing the Act. Section 7 authorises the State Government to grant exemptions from payment of land revenue under the Central Provinces Land Revenue Act, 1917 and the Berar Land Revenue Code, either wholly or partially, as it deems appropriate.

In this appeal the central issue was whether the language of section 5(3) imposed a duty on the State Government to award a suitable grant of money or pension when the applicant had lost the exemption provided by the Act and was a descendant of a former ruling chief. The Full Bench of the High Court had held that section 5(3) was discretionary and therefore did not create any mandatory obligation on the State Government to make such a grant. The appellants argued that the High Court’s interpretation was incorrect and that, despite the seemingly discretionary wording, the provision operated as a mandatory command so long as the remaining conditions of the sub‑section were satisfied. Before addressing that contention, the Court examined the rules made under section 8 of the Act, which were intended to govern applications filed under section 5(1). There are six such rules. Rule 3, after providing definitions of the terms “maufi”, “inam”, “maufidar” and “inamdar”, directs that upon receipt of an application the Deputy Commissioner may either conduct an inquiry himself or forward the matter to a Revenue Officer of at least the rank of Extra Assistant Commissioner for investigation and reporting. Rule 4 specifies the matters that the inquiry must address. Although Rule 4 is divided into sub‑rules (a) through (g), sub‑rules (a) to (e) require the inquiry to determine the lands possessed by the applicant, his income, the class of maufi or inam involved, and the particulars of the respective maufi or inam. The records show that many maufidars and inam holders possessed lands under a variety of titles and concessions, and sub‑rules (a) to (e) appear to apply uniformly to all applicants. However, when a maufi is held by a religious, charitable or public institution, or is granted for any service described in section 5(3)(i), or when it is held for the maintenance of a descendant of a former ruling chief as contemplated in section 5(3)(ii), the additional sub‑rules (f) and (g) become applicable alongside sub‑rules (a) to (e). Sub‑rule (f) mandates a special inquiry concerning religious, charitable or public institutions or services, focusing on whether the institution should continue to be maintained, whether the service should continue, and the minimum annual expenditure necessary for such maintenance. Sub‑rule (g) states that, in cases where a maufi or inam is intended for the maintenance of a descendant of a former ruling chief, further information must be supplied. This sub‑rule is followed by four detailed requirements: first, the inquiry must specify the minimum amount needed to ensure appropriate maintenance of the family; second, it must identify any other sources of income available to the applicant; third, the officer must indicate the extent to which the applicant depends on the maufi or inam.

In the matter before the Court, it was observed that the fourth enquiry requirement related to ascertaining the loyalty of the person receiving maufi income. Rule 5 then required that, after the enquiry was completed, the Deputy Commissioner prepare a report containing his recommendation. Rule 6 further directed the Deputy Commissioner to consider whether it would be preferable to exempt certain land wholly or partially from the liability to pay land revenue under Section 7, instead of granting a monetary allowance under Section 5(3). The State of Madhya Pradesh argued that the powers conferred by the Act were discretionary to the Government and that, consequently, no writ could be issued under Article 226 of the Constitution. To support this contention, it was pointed out that sub‑section (2) of Section 5 gives the Provincial (State) Government complete discretion, as the provision states that the Government “may pass such orders as it deems fit” with respect to every application forwarded by the Deputy Commissioner, and that sub‑section (3) is also expressed in directory language, stating that the Government “may make a grant of money or pension etc.”. This view appeared to have been accepted by the High Court. The Court, however, held that the contention could not be sustained when the scheme of Section 5 was examined closely. While it is true that the Deputy Commissioner must conduct enquiries and forward all applications to the Government, and that the Government possesses the authority to pass orders it deems fit, the discretion in sub‑section (2) applies to applications generally. In contrast, for certain categories of applications the order must be made under sub‑section (3), where the discretion is considerably limited. The rules elucidate the meaning of sub‑section (3). In every case an enquiry is required, and the enquiry usually follows the pattern laid down in Rule 4, sub‑rules (a) to (e). Yet, when the maufi or inam pertains to religious, charitable or public institutions, or when it concerns the maintenance of a descendant of a former ruling chief, additional enquiries are mandated. The rules also distinguish between the revocation of exemption for persons belonging to these two special categories and the revocation of exemption for other persons. It is apparent that Section 5 of the Act follows the same pattern, and the rules merely emphasize the special nature of sub‑section (3) of Section 5. The Government has been empowered to free certain lands from land‑revenue liability, so that at times a monetary grant or pension may be ordered, and at other times an exemption from land revenue may be ordered. The Court concluded that it could not have been intended for sub‑section (3) of Section 5 to be rendered ineffective by the discretion granted under sub‑section (2).

The Court explained that the two sub‑sections must be interpreted independently. Although the term “may” occurs in both sub‑section (2) and sub‑section (3), the meaning of “may” in sub‑section (3) is derived from an obligation imposed on the Government with respect to certain institutions and persons, provided the stipulated conditions are satisfied. The Court held it could not be imagined that, where a religious, charitable or public institution is required to be continued, or where there are descendants of former ruling chiefs, the Government possessed an unfettered discretion to refuse a grant of money or pension for their maintenance even though all conditions for such a grant were met and the claimants were deserving. Consequently, the Court said that the word “may” in section 5(3) must be read as mandatory whenever the precedent condition—namely, the existence of a religious, charitable or public institution that ought to be continued or the presence of descendants of a ruling chief—is established. By contrast, the phrase “may pass such orders as it deems fit” in sub‑section (2) merely indicates that the Government must formulate orders appropriate to the circumstances, with the nature of the order being dictated by the necessity of the situation. The Court cited Maxwell on the Interpretation of Statutes (11th edn. p. 23 1), observing that statutes which authorise persons to act for the benefit of others or for the public good often employ language such as “may”, “shall, if they think fit”, or “shall have power”. Although such language appears to grant permission, judicial precedent has repeatedly treated these expressions as carrying at least a compulsory force, effectively rendering them mandatory. In the present case, the existence of the condition precedent makes the grant of money or pension obligatory on the Government, even though section 5(2) confers on the Government the power to pass orders as it deems fit and sub‑section (3) uses the word “may”. The Court further noted that “may” is frequently interpreted as “shall” or “must” when the nature of the act imposes a duty on the person holding the power. Section 5(2) remains discretionary because it contemplates all cases that may be presented to the Government by persons claiming to be adversely affected by the provisions of section 3 of the Act. Many of those persons may have no actual claim, although they might be said in a general sense to be adversely affected by section 3. If the power were discretionary in every instance, there would be no

In this case the Court explained that the two sub‑sections were enacted to give the Government a limited discretion, not an absolute power. Sub‑section (2) simply conferred the ordinary meaning of the word “may,” allowing the Government to select certain claims for consideration under sub‑section (3) or under section 7 and to reject others. By contrast, sub‑section (3) imposed a duty on the Government: if it was satisfied that an institution or service must continue, or that a claimant was a descendant of a former ruling chief, the Government was required to grant money or a pension to the institution, service, or descendant, as appropriate. The Government could refuse a grant only where the claimant was not a descendant of a former ruling chief or where other reasonable grounds existed for denial. Except for such valid exceptions, the Court held that the word “may” in sub‑section (3) must be read as “must,” and that the High Court erred in treating this sub‑section as granting an unrestricted discretion. The Court then examined whether the Government’s order dated 26 April 1955 was justified. That order contained no reasons, although the Act imposed a duty on the Government to act in a judicial manner. The appellants had not been given an opportunity to be heard, and the Act expressly barred a suit, thereby necessitating a quasi‑judicial process that allowed claimants to present their case in light of the Deputy Commissioner’s report. The appellants were also entitled to know why their claim for money or pension was rejected and how the Government concluded that they did not belong to the class intended to be compensated. Even when a Government order relied on confidential material, this Court had previously required that reasons be given when the Government performed curial or quasi‑judicial functions, as noted in a cited precedent. The High Court had dismissed the petition at the threshold by interpreting section 5(3) in the same erroneous way, and it had not addressed any other issue. The Court found that interpretation to be mistaken, set aside the High Court’s order, and concluded that because the Government’s order failed to meet the basic requirements of a quasi‑judicial process, there was no need to remit the matter back to the High Court.

In this matter, the Court held that the order issued by the State Government could not stand and therefore it was required to be set aside. The Court further directed that the Government must reconsider and finally dispose of the case, taking into account the observations and comments made by the Court in its judgment. Accordingly, the Court issued an operative order reflecting this direction. The Court also ordered that the respondents, who were the parties opposing the appellants, should bear the expense of the litigation. Specifically, the respondents were required to pay the costs incurred by the appellants both in the proceedings before this Court and in the earlier proceedings before the High Court. On the basis of these determinations, the Court concluded that the appeal filed by the appellants was successful and therefore allowed the appeal. The judgment was reported in the 1962 volume of the Supreme Court Reporter, appearing at page 339, and the case citation includes the reference Ip./65‑2.