Holding

Section 74(1) of the Madhya Pradesh Reorganisation Act, 2000 is intra‑vires, constitutes conditional legislation, and authorises the State Government to lawfully abolish the State Administrative Tribunal.

Summary

The Madhya Pradesh High Court Bar Association challenged a notification issued under Section 74(1) of the Madhya Pradesh Reorganisation Act, 2000 that abolished the Madhya Pradesh State Administrative Tribunal, alleging that the provision was ultra‑vires Article 323A, amounted to excessive delegation of legislative power, was mala‑fide and violated the basic structure of the Constitution. The Supreme Court examined whether Parliament could empower a state to abolish a tribunal created under the Administrative Tribunals Act, 1985, and whether the power conferred was conditional legislation rather than delegated legislation. Relying on the constitutional doctrine that the power of judicial review under Articles 32, 136, 226 and 227 is part of the basic structure and on the ratio of L. Chandra Kumar, the Court held that Section 74(1) is intra‑vires, not excessive delegation, and that the State’s decision to abolish the tribunal was a lawful policy decision, not mala‑fide. Consequently, the High Court’s judgment upholding the abolition was affirmed and the appeals were dismissed.

Issues considered

The constitutionality of Section 74(1) of the Madhya Pradesh Reorganisation Act, 2000 in view of Article 323A of the Constitution
Whether Parliament’s delegation to the State Government to abolish an Administrative Tribunal amounts to excessive delegation of legislative power
Whether the abolition of the State Administrative Tribunal was mala‑fide or arbitrary
Whether the State’s action infringes the basic structure of the Constitution, particularly the jurisdiction of courts under Articles 32, 136, 226 and 227
The relationship between Section 74(1) and Section 74(4) of the Act

Legislation cited

Administrative Tribunals Act, 1985s. 4(2)
Constitution of Indias. 136, s. 226, s. 227, s. 245, s. 246, s. 309, s. 310, s. 32, s. 323A, s. 42nd Amendment (Art. 323A insertion)
Madhya Pradesh Reorganisation Act, 2000s. 74(1), s. 74(4), s. 85

Subjects

Administrative TribunalSection 74Madhya Pradesh Reorganisation ActDelegation of legislative powerConditional legislationBasic structure doctrineJudicial reviewUltra viresMala fide

Judgment

A M.P. HIGH COURT BAR ASSOCIATION
v.
UNION OF INDIA AND ORS.

SEPTEMBER 17, 2004

B [R.C. LAHOTI, CJ.I. AND C.K. THAKKER, J.]

M.P. Reorganisation Act, 2000 : Section 74(1).

Abolition of State Administrative Tribunal-Constitutionality of-Held
c : Not ultra vires Art. 323-A or any other part of the Constitution-Further,
L. Chandra Kumar's case did not lay down that once a Tribunal is
constituted, created or established, there was no power either in the Central
Government or the State Governments to abolish it-Constitution of India,
1950, Art, 323-A-Administrative Tribunals Act, 1985, S. 4(2).

D Abolition of State Administrative Tribunal-Validity of-Held : The
essential legislative function is to determine the legislative policy and its
formulation as a binding rule of conduct-Once such an essential legislative
function is preformed, the Legislative can delegate to the Executive authority
necessary ancillary and subordinate powers for carrying out the policy and
purposes of the Act-Therefore, authorizing the State Government to take a
E
decision to abolish the State Administrative Tribunal does not suffer from
excessive delegation-Hence, High Court rightly held that S. 74(1) was not
in the nature of "delegated legislation" but was conditional legislation.

Abolition ofState Administrative Tribunal-Validity of-Held: In view
F ofthe subsequent development oflaw in L. Chandra Kumar's case, the State
Government's opinion that the State Administrative Tribunal would be 'one
more tier' in the administration of justice and, therefore, it should not be
continued is not arbitrary, irrational or unreasonable-Moreover, the State
Government had also taken into consideration the decision in L. Chandra
Kumar's case abolishing the Tribunal-Hence, such a decision is not illegal,
G invalid or improper.

Abolition of State Administrative Tribunal-Alleged interference by
State Government in the judicial functioning of the State Administrative ..
Tribunal being violative ofthe basic structure ofthe Constitution-Correctness
H of-Held: There was no interference with a "judicial order" passed by a
520
M.P. HIGH COURT BAR ASSON. v. U.O.I. 521

competent court on a tribunal but a "policy decision" to abolish the State A
Administrative Tribunal-Hence, such abolition valid.

Abolition of State Administrative Tribunal-Allegation that such a
decision was mala fide as it was taken because the Tribunal had passed
orders against the State Government and granted relief in transfer matters-
Correctness of-Held: There is no concrete material to substantiate the said
B
allegation-Hence, decision to abolish the State Administrative Tribunal not
mala fide.

Abolition of State Administrative Tribunal-Validity of-Held : If a
decision is illegal, unconstitutional or ultra vires, it has to be set aside c
irrespective of the laudable object behind it-But it cannot be set aside
merely on the ground that such a decision was not advisable in the facts of
the case or that another decision could have been taken-While exercising
its power ofjudicial review, Supreme Court cannot substitute its own decision
for the decision of the Government.
D
Section 74(1) & (4)-Jnterrelation between-Held : S. 74(1) not
subservient to S. 74(4)-0nce the provisions of S. 74(1) are attracted and
invoked, the provisions of S. 74(4) had no application.

The state of M.P. issued a notification under Section 74(1) of the E
M.P. Reorganisation Act, 2000 by which the M.P. State Administrative
Tribunal was abolished.

Being aggrieved by the said decision the appellant-Association filed
a writ petition before the High Court for a declaration that Section 74

----- of the Act was unconstitutional and ultrq vires and for quashing and
setting aside of the said notification.
F

The High Court held that Section 74(1) of the Act was intra vires
the.Constitution and that the State Government ofM.P. was empowered
under Section 74(1) of the Act to abo.lish the State Administrative
Tribunal. The High Court further held that no directions from the G
Central Government were necessary to take the decision to abolish the
Tribunal. Hence the appeal.

On behalf of the appellant, it was contended that the State
Administrative Tribunal had been established under the Administrative H

...
522 SUPREME COURT REPORTS (2004] SUPP. 4 S.C.R.

A Tribunals Act, 1985 enacted by Parliament in exercise of power under
Article 323-A of the Constitution and, therefore, such a Tribunal could
not be abolished by a State; that the delegation of power to abolish the
State Administrative Tribunal conferred on the State Government by
Parliament under the Act of 2000 was in the nature of "excessive
delegation"; that the decision to abolish the State Administrative Tribunal
B
was ma/a fide and had been taken because the Tribunal had passed
orders against the State Government and granted relief in transfer
matters; that the interference by the State Government in the judicial
functioning of the Tribunal was violative of the "basic structure" of the
Constitution; and that under Section 74(1) of the Act of 2000 only the
C Central Government could issue a notification to abolish the State
Administrative Tribunal and since the Central Government had taken
no action abolition of the Tribunal was iliegal and unlawful.

On behalf of the respondent it was contended that the State
Government had abolished the State Administrative Tribunal after taking
D
int~ consideration the decision in L. Chandra Kumar's case as it was felt
that the Tribunal would be "one more tier" in the administration of
justice.

Dismissing the appeal, the Court
E
HELD: 1.1. A conjoint reading of Article 323-A of the Constitution,
Section 4 of the Administrative Tribunals Act, 1985 and Sections 74(1)
and 85 of the M.P. Reorganisation Act, 2000 shows that Parliament had
empowered both the successor States to take an appropriate decision to
F continue such Tribunals to abolish them or to constitute separate
Tribunals. It cannot be said that by enacting such a provision. Parliament
had violated any mandate or the ACt of 2000 is ultra vires Article 323-
A or any other part of the Constitution. [541-B, CJ

1.2. From the ratio laid down by this Court in L. Chandra Kumar's
G case to the effect that the jurisdiction of this Court under Articles 32
and 136 and also of the High Courts under Articles 226 and 227 of the
Constitution is a part of ·the "basic structure" of the Constituti~~ and
could not be ousted by making any provision in the Constitution and
that the Tribunals might perform a "supplemental role in the discharge
H of the power conferred upon this Court as well as the High Courts it
M.P. HIGH COURT BAR ASSON. v. U.0.1. 523

could not be said that once a Tribunal was constituted, created or A
established there was no power either in the Central Government or the
State Government to abolish it. There is no constitutional or statutory
prohibition against exercise of such power. Parliament which allowed
the State Government to request the Central Government for
establishment of an Administrative Tribunal under the 1985 Act has B
authority, power and jurisdiction to enable the State Government to
take an appropriate decision to continue or not to continue such Tribunal
and such a provision made by Parliament authorizing the State
Government to abolish such Tribunal cannot be· held ultra vires the
Constitution. (541-H; 542-A, B, CJ
c
L. Chandra Kumar v. Union of India, (1997) 3 SCC 261, relied on.

Mukesh Kumar Misra v. Union of India, W.P. No. 2398 of2001 decided
on 3.7.2001 by (MP) (DB), approved.
D
2. Under the Constitution of India, the power to legislate is with the
Legislature. The said power of making laws, therefore, cannot be
delegated by the Legisl~ture to the Executive. In other words, a
Legislature can neither create a parallel' legislature nor destroy its
legislative power. The essential legislative function must be retained by
the Legislature itself. Such function consists of the determination of E
legislative policy and its formulation as a binding rule of conduct. But
it is also equally well settled that once the essential legislative function
is performed by the Legislature and the policy has been laid down, it is
always open to the Legislature to delegate to the Executive authority
ancillary and subordinate powers necessary for carrying out the policy
F
and purposes of the Act as may be necessary to make the legislation
complete, effective and useful. [542-D, E, F)

3.1. The High Court rightly held that Section 74(1) of the Act of
2000 was not in the nature of "delegated legislation" but was a
"conditional legislation". (547-A) G

3.2. In the present case, the Act of 2000 as enacted by Parliament
was full and complete when it left the legislative chamber. There was,
therefore, no question of delegation of legislative power by the legislature
in favour of the executive. What was left to the executive was merely to H
524 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A decided whether to continue the Administrative Tribunal or to abolish
it. The State Government, after considering the facts and circumstances
decided not to continue the Tribunal, which was within the power of the
State Government, and, hence, no objection can be raised. against exercise
of such power. [549-C, D]
B
Hamdard Dawakhana v. Union of India, (1960] 2 S.CR 671, Sardar
Jnder Singh v. State of Rajasthan, (1957] SCR 605 and State of T.N. v. K.
Sabanayagam, (1998) SCC 318, relied on.

Hampton & Co. v. U.S., 276 US 394, R. v. Burah, (1878) 2 AC 889,
c Russell v. R., (1882) 7 AC 829, King Emperor v. Benoari Lal Sarma, (1944)
72 IA 57 and The Queen v. Burah, (1878) 5 lA 178, cited.

3.3. The matter can be looked at from another angle also. Article
323A is not self-executory. The said provision did not create or establish
Administrative Tribunals. It was merely a permissive or an enabling
D provision allowing Parliament to make law to establish Administra~ive
Tribunal if it wished to do so. Thus, there was no binding requirement
on the part of Parliament (or State Legislature) to create such a forum
as contemplated by Article 323A of the Constitution ~f India. It also
cannot be overlooked that the Administrative Tribunal in question was
E to be created for a particular State, i.e. State of Madhya Pradesh. Neither
under Article 323A of the Constitution nor under the Administrative
Tribunals Act, 1985, the Central Government could have created such
Tribunal except in accordance with the provisions of Section 4(2) of the
said Act. Essentially therefore, it was on the request made by the State
F of Madhya Pradesh to the Central Government that the power to create
and establish Administrative Tribunal in the State of Madhya Pradesh
was exercised by the Central Government and the Tribunal was
established. Therefore, there could be no objection in conferring the
power on the State Government to continue or to abolish such Tribunal.
Therefore, there is no excessive delegation by Parliament to the State
G Government. [549-E-H; 55~-A, B)

In re : The Delhi Laws Act, 1912 [1951J SCR 747, relied on.

4. In view of the subsequent development of law in L. Chandra
Kumar's case the State Government's opinion that the State
H
M.P. HIGH COURT BAR ASSON. v. U.0.1. 525

Administrative Tribunal would be "one more tier" in the administration A
of justice and, therefore, it should riot be continued is not arbitrary,
irrational or unreasonable. Moreover, the State Government had taken
into consideration the decision of this Court in L. Chandra Kumar's case
for aboiishing the State Administrative Tribunal. Such a consideration
was relevant, germane and valid. It therefore, cannot be said that the B
decision was illegal, invalid or improper. (552-E, F, G]

S.P. Sampath Kumar v. Union of India, [1987] 1 SCC 124, R.K. Jain
v. Union of India, (1993) 4 SCC 119; L. Chandra Kumar v. Union of India,
[1995] 1 SCC 119 and L. Chandra Kumar v. Union of India, [1997] 3 SCC
261, referred to. c
5. In the instant case, there is no interference with a "judicial
order" passed by a competent court or a Tribunal, but a "policy decision"
has been taken by the State Government to abolish the State
Administrative Tribunal allowing aggrieved litigants to approach D
appropriate authority/court for ventilating their grievances. (555-B]

P. Sambamurthy v. State ofA.P., [1987] 1 SCC 362, held inapplicable.

6. The High Court rightly ~eld that Section 74(1) is not subservient
to Section 74(4) of the Act and once the provisions of Section 74(1) of E
the Act are attracted and irivoked, the provisions of Section 74(4) have
no application. (557-A-B]

7.1. There is no concrete material on record to show that the decision
to abolish the State Administrative Tribunal was taken because of orders
F
passed by the State Administrative Tribunal. Except bald assertions by
the appellants and Press cuttings, there is nothing to substantiate such
allegations. On the contrary, sufficient material is available on record to
show what weighted with the respondent State in taking a decision to
abolish the Tribunal. (557-E, F]
G
7.2. It is clear that the State Government took into that after the
decision of this Court in L. Chandra Kumar's case an aggrieved
party could approach the High Court, and the object for
establishment of the Tribunal was defeated. In the item of the facts
before the Court it cannot be said the decision to abolish the State
H
526 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A Administrative Tribunal taken by the State of Madhya Pradesh can be
quashed and set aside as mala fide. [558-G, H]

L. Chandra Kumar v. Union of India, (1997] 3 SCC 261, relied on.

8. If a decision is illegal, unconstitutional or ultra vires. it has to be
B
set aside irrespective of the lqudable object behind it. But once it is held
that it was within the power of the State Government to continue or not
to continue the State Administrative Tribunal and it was open to the
State Government to take such a decision, it cannot be set aside merely
on the ground that such a decision was not advisable in the facts of the
c case or that another decision could have been taken. While exercising
power of judicial review, this Court cannot substitute its own decision
for the decision of the Government. From the record of the case, it is
amply clear that relevant, germane, valid and Proper considerations
weighed with the State Government and keeping in view development ,
D of law and the decision in L. Chandra Kumar's case a policy decision was
taken by the State Government to abolish the State Administrative
Tribunal. Parliament also empowered the State Government to take an
appropriate decision by enacting Section 74(1) of the Act of 2000 and in
exercise of such power, the State Government had taken· a decision. The
decision, therefore, cannot be regarded as illegal, unlawful or otherwise
E objectionable. (559-D, E, F)

L. Chandra Kumar v. Union of India, (1997) 3 SCC 261, referred to.

CIVIL APPELLATE JUl'USDICTION: Givil Appeal No. 5327 of2002.
F
From the Judgment and Order dated 14.5.2002 of the Madhya Pradesh
High Court at Jabalpur in W.P. No. 3531 of 200 I.

WITH

G C.A. Nos. 5328/2002, 6104, 6105-6106/2004, 8292-8295/2002, W.P.
(C) Nos. 369 and 374 of 2003.

Prashant Bhushan, Narinder Kumar Verma, Rohit Kumar Singh, Sanjay
Path~k for the Appellant in C.A. No. 5327/02, Ajit Puduseery (NP), for
H Appellant in C.A. No. 5328/2002.
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 52/7

B. Datta, ·Additional Solicitor General, P. Panneshwaran, for the A
Appellants in C.A. Nos. 6104/2004, 8292-95/2002 and Respondent for Union
of India.

Sanjeev Sachdeva, Mukesh Kr. Mishra and Ms. Priya Puri for the
Appellant in C.A. Nos. "6105-06/2004. · B
Shiv Sagar Tiwari, Ms. Pratima, Umesh Babu Chaurasia, M.P. Singh,
and Mani Mittal for the Petitioner in W.P. (C) No. 369/2003 ..

B.B. Dubey, S.K. Bandyopadhyay, Amitav Poddar and C.L. Sahu for
the Petitioner in W.P. (C) No. 370/2003. C

Satish K. Agnihotri, Anil K. Pandey, Amit Mishra, Prakash Srivastava,
(NP), Sanjeev Sachdeva, Mukesh Kr. Mishra,."Ms. Priya Puri and Ajit
Pudussery, (NP) for the Respondents.

The Judgment of the Court was delivered by D
'fHAKKER, J. : 'Leave granted in Special Leave Petition (Civil) Nos.
22648 of 2002 and 23615-23616 of 2002.

In the present group of matters, common questions of fact and law have
been raised by .the parties. It is, th~refore, appropriate to decide all the matters E
by a common judgmerit.

To appreciate the controversy raised and questions agitated in these
matters, few relevant facts in the first matter, i.e., Civil Appeal No. 5327 of
2002 may be stated. The appeal arises out of a judgment and order dated F
May 14, 2002 passed by the High Court of Madhya Pradesh at Jabalpur in
Writ Petition No. 3531 of 2001.

The said petition was filed by the Madhya Pradesh ·High Court Bar
Association and another against the Union ofI~dia, State of Madhya Pradesh,
State of Chhattisgarh and the Chief Ministers of both the States. The case G
of the petitioners is that the petitioner No. 1 is an Association of Advocates
practising at the High Court of Madhya Pradesh, Madhya Pradesh State
Administrative Tribunal at Jabalpur as also Central Administrative Tribunal
(Jabalpur Bench). The Association was constituted to look after and protect
the interests of its members. One of the prime duties of the Association, H
528 SUPREME COURT REPORTS (2004] SUPP. 4 S.C.R.

A asserted the petitioners, is to ensure that legal system in the State is not
attacked by an outside agency. Its aim is also to advance the cause of justice
by speedy trial. It has, therefore, locus standi to file a petition. Petitioner
No.2 is the President of the Madhya Pradesh Bar Association. He is a
practising lawyer at the High Court as well as at two Tribunals. He is a citizen
of India.
B
The petitioners have stated that Parliament amended the Constitution by
the Constitution (42nd Amendment) Act, 1976 by which several changes had
been made. As a consequence thereof, Article 323A came to be inserted in
the Constitution with effect from January 3, 1977. The said Article provided
c for constitution and establishment of Administrative Tribunals. Those
Tribunals were empowered to adjudicate and decide disputes and complaints
relating to recruitment and conditions of service of persons appointed to
public services and posts in connection with the affairs of the Union or of
any State or of any local or other authority within the territory of India or
under the control of the Government of India or of any corporation owned
D
or controlled by the Government. It also declared that the provisions of the
said Article would have effect notwithstanding anything in any other
provision of the Constitution or in any other law for the time being in force.
The Article further provided for exclusion of jurisdiction of all courts,
"except the jurisdiction of the Supreme Court under Article 136", with
E respect to disputes or complaints to be dealt with by such tribunals. Article
323A, however, is not self-executory inasmuch as it did not take away the
jurisdiction of courts. It merely enabled Parliament or appropriate legislature
to make laws, to set up such tribunals and to exclude jurisdiction of all courts
except the Supreme Court.
F
In exercise of the power conferred by Article 323A of the Constitution,
Parliament enacted an Act, called the Administrative Tribunals Act, 1985
(hereinafter referred to as "the Act"). In the Statement of Objects and
Reasons, it was stated that with a view to give effect to the constitutional
provision by providing for the establishment of an Administrative Tribunal,
G the Act has been enacted. The Preamble of the Act also recites that with a
. view to provide for the adjudication or trials by Administrative Tribunals of
disputes and complaints with respect to recruitment and conditions of service
of persons appointed to public services and posts in connection with the
affairs of the Union ot of any State or of any local or other authority, the
Act has been enacted. Whereas Section 4 provides for establishment of
H
M.P. HIGH COURT BARASSON. v. U.O.I. [THAKKER, J.] 529

Administrative Tribunals, Section 5 deals with composition of Tribunals and A
Benches. Provisions relating to qualifications for appointment as Chairman,

.. Vice-Chairman and other Members as also their terms of office, salaries and
allowances, etc. have been made in Sections 6 to I 3. Sections 14 to 18 deal
with jurisdiction, power and authority of Tribunals. Sections 19 to 27 lay
down the procedure to be followed by such Tribunals. Section 28 excludes B
jurisdiction of all courts except the Supreme Court.

Sub-section (2) of Section 4 of the Act enabled the Central Government,
on receipt of a request from the State Government to establish by a
notification an Administrative Tribunal for the State to exercise the jurisdiction,
powers and authority conferred on the Administrative Tribunal for the State. C
According to the petitioners, a request was made by the State of Madhya
Pradesh for the establishment of an Administrative Tribunal for the State.
The Central Government, in exercise of power under sub-section (2) of
Section 4 of the Act, therefore, issued a notification on· June 29, 1988 for
establishment of a Tribunal known as the Madhya Pradesh Administrative D
Tribunal with effect from August 2, 1988. The petitioner stated that in
pursuance of the notification, the State Administrative Tribunal had been
established. It was having a Principal seat at Jabalpur and four Benches at
Gwalior, Indore, Bhopal and Raipur.

The petitioners further stated that Parliament enacted an Act called the E
Madhya Pradesh Re-organisation Act, 2000, (Act 28 of 2000) (hereinafter
referred to as "the Act of2000"). The said Act has been enacted with a view
"to provide for the re-organisation of the existing State of Madhya Pradesh
and for matters connected therewith". Part II deals with re-organisation of
the State of Madhya Pradesh into two States to be known as the State of F
Madhya Pradesh and the State of Chhattisgarh and their territorial divisions.
Part III provides for representation in the Legislatures. Part IV relates to
administration of justice. Part VIII deals with services. It provides for All-
India services, services in Madhya Pradesh and Chhattisgarh and other
services as also power of the Central Government to issue directions. Section
74 of the Act touches jurisdiction of Commissions, Authorities, Tribunals, G
Universities, Boards and other statutory bodies, constitutional validity and
vires whereof has been challenged. It is, therefore, appropriate to re-produce
the said section in extenso.

"74. Jurisdiction of the Commissions, Authorities and Tribunals.- H
530 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

(1) Notwithstanding anything contained in any law for the tim~
being in force, every Commission, ·Authority, Tribunal, University.,
Board or any other body constituted under a c·entral Act, State Act
or Provincial Act and having jurisdiction over the existing State 6f
Madhya Pradesh shall on and from the appointed day continue t<:>
function in the s~ccessor State of Madhya Pradesh and also exercise
B
jurisdiction as existed before the appointed day over the State of
Chhattisgarh for a .maximum period. of two .years from the appoiqted
day or till such period as is decided by mutual agreement between
the successor States:

c (i) to continue such body as a joint body for the successor
· State or

(ii) to aboliMJ. it, on the expiry of that period, for.either of.the
successor States; or

D (iii) to constitute a separate Commission, Authority, Tribunal,
University, Board or any other body, as the case may be,
for the State of Chhattisgath.

(2) No suit or other legal proceeding sha,U be instituted, in case
such body is abolished under clause (ii) of sub-secti_on (1), by any
E
employee of such body against the termination of·his appointment
or for the enforcement of any service conditions or for securing
absorption in alternative public employment against the Central
Governmeqt. or any of the successor States.

F (3) Notwithstanding anything contained in any law for t&e time
being in force or in any judgment, decree or order of any court or
Tribunal or contract or agreement, any Chairman or member ~f any
body abolished under clause (ii) of sub-section (l) shall not be
entitled to any compensation for the unexpired period of his tenure.

G (4) Notwithstanding anything contained in this section or any law
for .the time being in force, !he Central Government shall, in
accordance with any mutual agreement between the successor States
or if there is no such agreement, after consultation with the
Government of the successor States, issue directions for the resolution
H of any matter relating to any body referred to in sub-section (l) and
- M.P. HIGH COURT BAR ASSON. v. U.O.I. [THAKKER, J.] 531

falling within the jurisdiction of any of the successor State within
any period referred to in sub-section (1 ).
A

Se1;tion 85 declares that the provisions of the Act shall have overriding
effect "notwithstanding anything inconsistent therewith contained in any
other law."

Bare" reading of sub-section (l) of Section 74 makes it clear that it
declares that all Commissions, Authorities, Tribunals, Universities, Boards
or other bodies constituted under an Act of Parliament will continue to
function in the State of Madhya Pradesh as also in the State of Chhattisgarh.
It, however, states that they will continue to function for a maximum period c
of two years or "till such period as is decided by mutual agreement betw~en
the successor States". Sub-sections (2) and (3) enumerate circumstances
pursuant to the aboliti~n of such Tribunal. Sub-section (4) allows the Central
Government to issue directions.
D
The petitioners stated in the petition that in purported exercise of the
powers under sub-section (1) of Section 74 of the Act, a decision was taken
by the State of Madhya Pradesh as well as the State ofChhattisgarh to abolish
S~te Administrative Tribunal. A notification was issued on 25th July, 2001
by the State of Madhya Pradesh by which the Madhya Pradesh State.
Administrative Tribunal had been abolished. By a circular of even gate E'
issued by the State, it had been ordered that existing Chairman, Vice-
Chairman and Members of the Tribunal would cease to function wi~h
immediate effect irrespective of unexpired period of their tenure, if any. By
an order of even date, the State Government terminated the services of all
officers and employees other than those on deputation with immediate effect
F
as their services were "no longer required". I

Being aggrieved by the said. actions, the petitioner-Association
approached the High Court of Madhya Pradesh by invoking Articles 226 and
227 of the Constitution. A writ of Mandamus was sought to declare Section
74 of the Act of 2000 unconstitutional and ultra vires. In the alternative, G
a prayer was made to issue a writ of Mandamus to hold that Section 74 would
not apply to State Ad~inistrative T~ibunal. A further prayer was made to
quash.and set aside a notification, a circular and an order dated July 25, 200 l
by which the Stat~ AdriliQ.istrative Tribunal was sought to be abolished and
consequential actions were taken.
H
A
532 SUPREME COURT REPORTS [2004) SUPP. 4 S.C.R.

Similar petitions were filed being W.P. No.3529 .of 2001 by A.K.
Shrivastava, a Member of the Administrative Tribunal, W.P. No.3525 of
-
2001 by Sanjay Kumar.Misra, W.P. No. 3551 of2001 by Kamal Joshi, W.P.
No.3554 of2001 by Nemi Chand, all employees of the State Administrative
Tribunal, W.P. No. 3597 of 2001 and W.P. No.4129 of 2001 by Madhya "
B Pradesh Class 111 Government Employees Association.

Notices were issued to the State of Madhya Pradesh and other
respondents. The respondents appeared. An affidavit-in-reply was filed by
the State of Madhya Pradesh supporting the actions taken by the Government.
It was asserted fa the counter that establishment of State Administrative
c Tribunal was not obligatory. The State. Government was not bound to
constitute the Tribunal. It was, therefore, open to the State Government to
create, continue or abolish such Tribunal. Since the power exclusively vested
in the State Government to create, continue or abolish the Tribunal, the
Central Government had no voice in the matter. It was also stated that the
Council of Ministers of the State of Madhya Pradesh took a decision on
·D
November 21, 1985 for the establishment of State Administrative Tribunal
in the State of Madhya Pradesh. A request was, therefore, made to the Central
Government to constitute State Administrative Tribunal and, accordingly, a
notification was issued on June 29, 1988 and the Tribunal was constituted
on August 2, 1988. Initially there was only a Principal seat at Jabalpur. Later
E on, three Benches were established at Gwalior, Indore and Bhopal. In 1997,
even the fourth Bench was established at Raipur. The deponent stated that
over and above State of Madhya Pradesh, seven other States had established
State Administrative Tribunals. In the affidavit in reply, it was the case of
the respondent-State that despite very laudable object behind the establishment
F of Administrative Tribunals, the performance of. the Tribunals always
remained "far from satisfactory and the Tribunals failed to achieve the objects
and goals for which they were established". Reference was made to the report
of the Arrears Committee (1989-90), known as "Malimath Committee"
which elaborately dealt with the Junctioning of Tribunals in the country.
Citing extensively the working of the Tribunals in the report of Malimath
G Committee, it was asserted by the State that the State Administrative Tribunal
failed to fulfill the object for which it was established. Moreover, after the
landmark decision of the Supreme Court in L. Chandra Kumar v. Union of
India, [1997) 3 SCC 261 : AIR (1997) SC 1125, wherein it has been held
by the Apex Court that the decisions rendered by the Tribunals constituted
H under Articles 323A and 323B of the Constitution of India would be subject
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 533

to the writ/supervisory jurisdiction of the High Courts under Article 226/227 A
of the Constitution within whose territorial jurisdiction the particular Tribunal
is functioning, there was virtually no need to continue such Tribunal. It was
,the case of the respondent-State that in the light of declaration of law in L.
Chandra Kumar, Administrative tribunals became "intermediate/additional
adjudicatory stratum", "leading to substantial increase in number of pending B
cases at the level of High Court". Several matters decided by such Tribunals
were challenged before High Courts.

Other problems had also been highlighted by the respondent-State in
the counter-affidavit which necessitated the _State to take a decision to abolish
it. It included steep increase in pendency of cases, construction of infrastructure, c
huge finance, maintenance of recurring expenses, etc. The policy makers of
the State had been continuously monitoring the Tribunal's progress and
performance as dispensation of justice was an important priority of the State.

Parliament meanwhile passed the Act of 2000 on 18th September, 2000
D
providing re-organisation of the erstwhile State of Madhya Pradesh into two
·States. Sub-section (1) of Section 74 of the Act allowed both the States to
continue functioning of the Tribunal in the successor States.
It, however, authorized them to take a decision to abolish State Administrative
Tribunal by mutual agreement. Thus, the power had been conferred by
Parliament on States of Madhya Pradesh and Chhattisgarh to take an E
appropriate decision with regard to continuation or abolition of State
Administrative Tribunal. Such action, therefore, cannot be said to be illegal
or contrary to law. The Act of 2000 has been enacted by Parliament in
exercise of powers under Articles 2 to 4 of the Constitution of India. The
Act, therefore, cannot be said to be unconstitutional or ultra vires. F

Respondent No. l Government of India also filed a counter-affidavit
confirming that the State of Madhya Pradesh was "free to recommend
abolition of the Madhya Pradesh Administrative Tribunal". It was stated that
the Central Government would examine the proposal of the State Government
to abolish State Administrative Tribunal keeping in view several factors, such G
as, alternative forum proposed by the State Government for disposal of
pending cases, compensation/rehabilitation of various functionaries of the
Tribunal, etc. On interpretation of Section 74 of the Act of 2000, the Central
Government stated that the State of Madhya Pradesh cannot of its own
abolish State Administrative Tribunal which was set up by the Central H
534 SUPREME COJJRT REPORTS [2004] SUPP. 4 S.C.R.

A Government Uf?.der Section 4(2) of the Administrative Tribunals Act, 1985.
According to the deponent, Section 74(1) of the Act of 2000 was "only an
enabling provision to facilitate the State Government to take a decision about
the continuance or otherwise of the Madhya Pradesh Administrative Tribunal".

Further affidavit was also filed by the State of Madhya Pradesh wherein
B a reference was made to an order of Council of. Ministers
dated 8th March, 2001 to abolish the Madhya Pradesh Administrative
Tribunal.

The DivisiOi:i Bench of the High Court of Madhya Pradesh, after hearing
c the parties, held that the provisions of sub-section (I) of Section 74 of the
Act of 2000 are intra vires the Constitution and the State of Madhya Pradesh
possessed power to abolish the State Administrative Tribunal. No direction
from the Central Government as envisaged by sub-section (4) of Section 74
was required. According to the Court, Section 74(1) conferred unfettered
power on both successor States to take a decision in regard to the abolition
D of Tribunal. It was thu:s in the exclusive discretion df the successor States
and no power or authori1ty had been given to the Central Go.vernment in the
said process. The Com1 also indicated that Parliament appeared to have
granted "an opportunity of re-determination to both the successor States in
view of substantial ch~nged circumstances necessitating review of all existing
E bodies keeping the experience of the old State".

· Regarding sub-sections (2) and (3) of Section 74 of the' Act of 2000,
however, after considering Articles 309 and 310 of the Constitution of India
and Sections 8, 9 and 10 of the Administrative Tribunals Act, 1985, the High
Court held that the State could not have i&nored statutory and constit}ltionai
F provisions. Sub-sections (2) and (3) of Section 74 were thus ultra vires
Articles 14, 16 and 2'1 of the Constitution. The. High Court, however,
recorded the statement of the learned Advocate General of the State of
Madhya Pradesh that the State Governmerit shall abide by the decision of the
court with regard to oflicers and employees of the Government.
G The High Court also held that after taking a decision to abolish the.
Ma°dhya Pradesh State ·Administrative Tribunal, the State Government h~d
to request the Central Government for issu.ance of necessary notification for
abolition of such Tribunal since it has been established by the Central
Government. According'~ to the Court, however, the Central Government had
H no option but to accept the request of the State Government. In the light
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 535

of the said decision, notification, circular and order dated 25th July, 2001 A
were quashed by the Court.

In the operative part of the judgment, the High Court issued following
directions:-

(i) The State Government of Madhya Pradesh is empow.ered •
B
under Section 74(1) of the M.P. Re-organisation Act to 1ibolish
the State Administrative Tribunal.

(ii) No 9irections from the Central Government as envisaged
.
under sub-section 4 of Section 74 of the Act of 2000 are C
necessary to take the above decision to abolish the Tribunal. ·

(iii) After taking decision .to abolish the State Administrative
Tribunal, the State Government will have to make request to ·
the Central Government to issue notification for abolish of the
State Administrative Tribunal. D

(iv) The Central Government has no option but to accept the
request received from the state Government to abolish the State
Administrative Tribunal and accordingly issue a notification
rescinding the earlier Notification establishing the same.
E
(v) The sub-sections (2) and (3)° of Section 74 of the M.P.
Reorganisation Act are declared ultra vires.

(vi) Since the notification (Annexure P-1) abolishing the State
Administrative Tribunal has been issued by the State F
Government itself, and not by the Central Government, the
notification (Annexure P-1) shall stand quashed.

(vii) Consequent to quashment of the Notification (Annexure
P-l), the Circular Annexure P-2) and the Order (Annexure P-
3) also stand quashed. G

(·viii) Since the Madhya Pradesh Ordinance No. 3 of 200 I 'has
lapsed, no order is necessary to quash the same.

(ix) On abolition of the Tribunal, the Chairman, Vice Chairman H
536 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A and Members shall be entitled to have compensation for
unexpired term of their services from the State Government.
The details shall be worked out as per principles. of natural
justice.

(x) On abolition of the Tribunal, the officers and employees
B
thereof shall be dealt with by the State Government as per their
service conditions, including their absorption in other
Departments of the State Government.

Being aggrieved by the order passed by the High Court, the Bar
C Association instituted Special Leave Petition (Civil) No.16108 of 2002 on
July 11, 2002. It may be stated that in other matters also, leave was sought
by the petitioners to approach this Court by filing Special Leave Petitions.
In Special Leave Petition Nos.23615 and 23616 of 2002, the decision
upholding constitutional validity of sub-section (1) of Section 74 of the Act
D of 2000 is challenged. We may also observe at this stage that Writ Petition
No. 374 of 2003 was filed by one Chhadami Lal and Writ Petition No. 369
of2003 by the Government Employees Class III Association. Union of India
has also challenged the decision of the High Court of Madhya Pradesh in
Civil Appeal Nos.8292-95 of 2002 against certain directions of the High
Court.
E
On August 26, 2002, leave was granted by this Court and hearing was
ordered to be expedited. Other matters which were subsequently. filed were
also ordered to be heard along with Civil Appeal No.5327 of 2002.

F We have heard the learned counsel for all the parties.

Mr. Prashant Bhushan, learned counsel for the appellant contended that
the action of abolishing Madhya Pradesh State Administrative Tribunal is
illegal, improper and unlawful. According to him, the State Administrative
Tribunal had been established under the Administrative Tribunals Act, 1985
G enacted by Parliament in exercise of power under Article 323A of the
Constitution. Such Tribunal, therefore, cannot be abolished by a State. It
was further submitted that Section 74 of the Act of2000 by which Parliament
authorized the State Government to discontinue or abolish State Administrative
Tribunal is ultra vires the Constitution as no such power could have been
H delegated to the State. It was also urged that the delegation of power to
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 537

abolish State Administrative Tribunal conferred on the State Government by A
Parliament under the Act of 2000 is in the nature of "excessive delegation"
and would be inconsistent with the provisions of the Constitution as also
contrary to several decisions rendered by this Court wherein it has been
observed that a competent legislature cannot delegate essential legislative
function or legislative policy. The High Court, in the circumstances, ought B
to have declared sub-section (I) of Section 74 ultra vires.

Alternatively, it was submitted that even if this Court holds that
Parliament was competent to delegate its power to the State Government to
discontinue the State Administrative Tribunal, the impugned action of the
State of Madhya Pradesh is illegal, unlawful and malafide. It was contended C
that the Tribunal has been abolished as, according to
the Government, in many matters it had passed orders against the Government
and granted interim relief in "transfer" matters. It was, therefore, contended
that what weighed with the State Government for abolishing the State
Administrative Tribunal was "judicial orders" passed by a competent Tribunal D
in exercise of its undoubted jurisdiction thereby taking into account irrelevant
consideration and such a decision cannot be said to be a decision in the eye
of law and the action deserves to be set aside.

It was also urged that from the affidavit in reply filed on behalf of the
State, it was clear that it had also considered the criticism against working E
of Tribunals by Malimath Committee. The report of the said Committee,
however, has been commented upon by this Court in L. Chandra Kumar and
the criticism by the said Committee against the working of the Tribunals was
not approved. It was, therefore, submitted that if on the basis of such
criticism an action is taken, the same deserves to be quashed.
F
On merits, counsel contended that there was no need for abolishing the
Tribunal. No reasons for such abolition have been mentioned anywhere. No
study was conducted regarding functioning of the Tribunal. Statistics had
shown that several cases had been adjudicated and decided by the Tribunal
and even after the decision of this Court in L. Chandra Kumar, only few G
matters had reached the High Court and in the rest of the matters, the
decisions of the Tribunal had not been challenged. Thus, it was not right,
as stated by the State of Madhya Pradesh, that after the decision in L. Chandra
Kumar, the Tribunal remained as "additional tier" in the administration of
justice. If that was the basis and foundation on which the State had taken
H
538 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A a decision, the same being incorrect in fact and untenable at law, the order
of abolishing the Tribunal deseryes to be set aside. In this connection, the
counsel submitted that ambit and scope of jurisdiction of Administrative
Tribunals exercising power under the Act and of the High Court under
Articles 226 and 227 of the Constitution is totally different and distinct. Even
if the decision rendered by the Tribunal can be made subject matter of writ
B
. jurisdiction/supervisory jurisdiction of a High Court under Article 226/227
of the Constitution, the later exercises the power of "judicial review" and
neither original nor appellate power. The sweep and extent of two jurisdictions
cannot be compared. •The learned counsel submitted that all these points h?.ve
not been appreciated in their ptoper perspective by the High Court and the
c decision of the High Court suffers from non-application of mind and non-
consideration of relevant aspects and needs interference.

Other counsel appearing in the remaining matters s~pported Mr.
Prashant Bhushan and adopted the arguments put forward by him. They also
D submi.tted tnat an attempt has been made by the State of.Madhya Pradesh
to interfere with judicial functioning of the Tribunal which is violative oft~e
"basic feature of the Cons~itution" which protects and safeguards the
independence of judiciary and such action deserves to be quashed and set
aside by this Court.

E Mr. B. Datta, learned Additional Solicitor General forthe Union oflndia
has voiced grievance against some of the conclusions reached by the High
Court, particularly, that the State of Madhya Pradesh has the authority to
abolish the State Administrative Tribunal and if a request is made by the State·
Government to the Central Government to abolish the Tribunal, the latter has
F no option but to accept such request. .

The learned counsel appea~ing for the State of Madhya Pradesh, on the
other hand, supported the order passe~ by the High Court. According to him,
the State Administrative Tribunal was constituted and established in the Stafe ·
only at the request of the State of Madhya Pradesh. It was, therefore, clear
G that the State of Madhya Pradesh wanted establishment of such Tribunal.
Ot>viously, therefore, it was open to the State if it felt that continuance of
such Tribunal would not be in the larger interest. It was also urged by th~
counsel that the State Government i:ealised the need and necessity of such
Tribunal in the light of the provisions of Article 323A of the Constitution
H .as amended by the Constitution (42nd Amendment) Act, 1976 and after 1985
M.P. HIGH COURT BAR ASSpN. v. U.0.1. [THAKKER, J.] 539

Act by Parliament. }he counsel also -submitted that the validity of 1985 Act A
came up for consideration before this Court in S.P. Sampath Kumar v. Union
of India, [1987] 1 SCC 124 : AIR (1987) SC 386 and the constitutional
validity of the Act had been upheld. Virtually therefore, after the decision
in S.P. Sampath Kumar, the Administrati~ Tribunal was held "substitute"
of the High Court. The State of Madhya Pradesh, therefore, thought it proper B
to have. such Tribunal. Accordingly, a request was made and the Tribunal
was established in •1988. But the position was substantially altered after the
decision in L. Chandra Kumar. In the said case, this Court held that the power
of "judicial revie~" conferred on all High Courts by the Constitution is a
basic feature of the Constitution. Such power cannot. be taken away even ·
by an amendment in 'the Constitution. Clause (d) of Article 323A(2) and C
Clause (Q) of Article 3238(3) of the Constitution were, therefore, held ultra
vires. The consequence of the decision in L. Chandra Kumar ~as that after
a decision by· the State Administrative Tribunal, an aggrieved party can
approach the High Court within the territorial jurisdiction of which a decision
has been rendered by such Tribunal and such decision could be made subject D
matter of judicial review before the High Court. Considering the above fact,
the Council ofMinisters thoµght that it would not be appropriate to ha".e such
Tribunal in view of the decision in L. Chandra Kumar. According to the
counsel, such a decision could never be termed as arbitrary, unreasonable or
ma/a fide. Therefore, even if it is assumed that all the matters which had
been decided by an Administrative Tribunal may not be \aken to High Court, E
it cannot prevent the Council of Ministers to take an appropriate decision as
to continuance or otherwise of the State Administrative Tribunal. It was a
policy decision. The question is not of advisability or propriety of such
decision, but legality and constitutionality thereof. If the decision is
otherwise legal, valid and in accordance with law, it cannot be set aside. A F
court of law can interfere with such decision only if it is unconstitutional or
without authority of law. It was submitted that even Parliament considered
the fact that the Tribunal was established for adjudication of service disputes
in the State of Madhya Pradesh and at the request of the State, such Tribunal
was constituted. Hence, a provision was made. in Section 74 of the Act
enabling the State Governments to continue or not to continue such Tribunal. G
Such a provision cannot be termed arbitrary or unreasouable. There is no
delegation of legislative power by Parliament on the State. Since, the State
Government had requested the Central Government to constitute a Tribunal
and a Tribunal had been constituted, Parliament thought it appropriate to.
authorize the State Government to decide as to whether such Tribunal should H
540 . SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A be continued or abolished. There is, thus, no "excessive delegation" in such
matters and the High Court was fully justified in repelling the contention of
the petitioners-appellants and in dismissing the petition.

Regarding ma/a fide exercise of power, it was s·1bmitted that there was
no material to show that the action was not bona fide or has been taken in
B
colourable exercise of power. There is nothing to substantiate such bald
allegations. Though it was asserted that the Tribunal has been abolished
because it had passed certain "judicial orders", it is merely ipse dixit and
based on newspaper reports. From the record, it is clear that the State
considered the decision in L. Chandra Kumar and a satisfaction had been
C reached by the Council of Ministers that there would be "one more tier" if
Administrative Tribunal would be continued. Accordingly, it was resolved
to abolish the Tribunal. Such a decision cannot be said malicious or ma/a
fide. It was, therefore, submitted that the appeal deserves to be dismissed.

So far as constitutional validity and vires of sub-section (I) of Section
D 74 of the Act is concerned, in Mukesh Kumar Misra and Another v. Union
of India and Others, (W.P. No. 2398 of 2001 decided on 3rd July, 2001),
the Division Bench of the High Court of Madhya Pradesh upheld the validity
thereof. Considering the provisions of the Constitution including Article
323A and the relevant provisions of the Act, the Court held that Parliament
E was competent to enact the Act of 2000 and it was open to Parliament to
confer power on the States of Madhya Pradesh and Chhattisgarh to take an
appropriate decision as to continuance or otherwise of any Commission,
Authority, Tribunal, University, Board or any other body constituted under
the. Central Act, State Act or Provincial Act "having jurisdiction over the
existing State of Madhya Pradesh". The Court also held that discretion had
F
been conferred on both the State Governments to abolish the Tribunal if they
wished to do so. The Court noted that Article 323A of the Constitution was
merely an enabling provision and it was not incumbent on State Governments
to constitute a Tribunal under the Act of 1985. In the opinion of the Court,
there was no inconsistency or conflict between Section 74(1) of the Act of
G 2000 and Article 323A of the Constitution or Section 4 of the Administrative
Tribunals Act, 1985. It was also observed that sub-section ( l) of Section 74
of the Act of 2000 opens with non obstante clause ("Notwithstanding
anything contained in any other law for the time being in force") and allows
the States of Madhya Pradesh and Chhattisgarh to continue or to abolish
Tribunals in the respective States. In this connection, it is also profitable to
H
j
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 541

refer to Section 85 which declares that the provisions of "this Act shall have A
effect notwithstanding anything inconsistent therewith contained in any other
law". Conjoint reading of Article 323A of the Constitution, Section 4 of
the Administrative Tribunals Act 1985 and Sections 74(1) and 85 of the Act
of 2000, in our considered opinion, leaves no room of doubt that Parliament
authorized the State of Madhya Pradesh as well as the new State of B
Chhattisgarh to take an appropriate decision with regard to State Administrative
Tribunals having jurisdiction over those States. Parliament empowered both
the successor States to take an appropriate decision to continue such
Tribunals, to abolish them or to constitute separate Tribunals. It cannot be
said that by enacting such a provision, Parliament had violated any mandate
or the Act of 2000 is ultra vires Article 323A or any other part of the C
Constitution.

It was then contended that once the power to constitute a Tribunal had
been exercised, Parliament was denuded of any power to make any legislation
providing for abolition of such Tribunal. The Division Bench negatived the D
contention and observed :

"It is difficult to swallow that Parliament after enacting law on
a particular subject shall have no power to amend, modify or repeal
the same. The power of the Parliament, in our opinion, does not
exhaust by enactment of any law and we are of the considered E
opinion that Parliament can make law in relation to a subject for
which it has the legislative competence, notwithstanding the fact that
law on a particular subject was enacted by the Parliament earlier.
The theory of exhaustation is unknown so far as the legislative
powers are concerned. What Parliament has done, Parliament can F
undo."

The above observations, in our view, are in consonance with law and
lay down correct proposition of law.

We are also not impressed by the argument of the learned counsel for G
the appellants that in the light of the ratio laid down by this Court in L.
Chandra Kumar, an Administrative Tribunal constituted under the 1985 Act
cannot be abolished. What has been held by this Court in L. Chandra Kumar
was that the jurisdiction conferred on this Court under Articles 32 and 136
of the Constitution as also of the High Courts under Articles 226 and 227 H
542 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A of the Constitution is a part of the "basic structure" of our Constitution. That
jurisdiction carinot be ousted by making any provision in the Constitution
also. So far as Tribunals are concerned, they may perform a "supplemental
role" in the discharge of power co~ferred upon the Supreme Court as well
as upon High Courts. From that, however, it cannot be said that once a
B Tribunal is constituted, created or established, there is nq power either in the
Centrai Government or State Governments to abolish it. There is no
constitutional or statutory prohibition a·gainst exercise of such power. To us,
it is clear that Parliament which allowed the State Government to request the
Central Government for establishment of an Administrati.ve Tribunal tinder
the 1985 Act has authority, power and. jurisdiction to enable the State
c Government to take an appropriate decision to cqntinue ·or no~ to continue
such.Tribu.nal and a provision by Parliament authorizing the State Goverfiment
to abolish such Trib1mal, by no stretch of imagination; can be held ultra vires
the Constitution or inconsistent with the law laid down by' this Court in L. -
Chandra Kumar.
D
Under the Constitution of India, the power to legislate is with the
Legislatu11e. The said power of.making laws, t~erefor.e, cannot be delegated
by the Legislature to the Executive. In other words, a Legislature can neither
create ~ parallel legislature nor destroy its legislative power. The essential
legislative function .must be retained by the Legislature itself. Such funct\on
E consists of the determinatiQn of legislative policy 'and its formulation as a
binding rule of conduct. But it is also equally well-settled that once the
essential legislative function is performed by the Legislature and the policy
has been laid down, it is always open to the Legislature to. delegate to the
· Executive authority ancillary and subord!nate power~ necessary for carrying
F out the policy and.purposes of the Act as may be necessary to make the
legislation complete, effective and useful.

Mr. Bhushan, learned counsel for the appellants invited our attention
to the leading <;ase of In re: The Delhi Laws Act, 1912 (1951 SCR747). The
question which arose before this Court in that case was of "great public
G importance" and was "first of its kind". The Cen!ral Government was
authorized by Section 2 .<:>f Part C States (Laws) Act, 1950 to extend to any ·.
Part C State with such modifications and restrictions as it thinks fit, any
enactment in force in Part A State. While doing so, the Government was
also authorized to repeal or amend any corresponding law (other than a
H Central Act) which might be in force in Part C State. While dealing with ·
M.P. HIGH COURT BAR ASSON. v. U.OJ. [THAKKER, J.] 543

the Reference under Article 143 of the Constitution of India, this Court A
opined that keeping the exigencies of the mo~ern Government in view,
Parliament and State Legislatures in India needed to delegate legislative
power, if they were to be able to face the multitudinous problems facing the
country, as it was neither practicable nor feasible to expect each of the
legislative bodies to enact complete and comprehensive legislation on ail B
subjects sought to be legislated upon. It was also observed that since the
legislatures in India derive their powers from written Constitution, they could
not be allowed the same freedom as the British Parliament has in the matter
. of delegation.

Relying on some of the observations, the learned counsel submitted that C
the provisions of sub"section (1) of Section 74 of the Act of 2000 must be
held ultra vires. The counsel referred to the following observations of Kania,
' I ·:· ' '

CJ.:

"A fair and close reading and analysis of all these decisions of
the Privy Council, the judgments of the Supreme Courts of Canada
D
and Australia without stretching and straining the words and
expressions used therein lead me to the conclusion that while a
legislature, as a part of its legislative functions, can confer powers
,. to make rules and regulations for carrying the enactment into
operation and effect, and while a legislature has power to lay down E
the policy and principles providing the rule of conduct, and while
it may further provide that on certain date or facts being found and
ascertained by an executive authority, the operation of the Act can
be extended to certain areas or may be brought into force on such
detennination which is described as conditional legislation the
F
power to delegate legislative functions generally is not warranted
under the Constitution of India at any stage. In cases of emergency,
like war where a large latitude has to be necessarily left in the matter
of enforcing regulations to the executive, the scope of the power to
make regulations is very wide, but even in those case the suggestion
that there was delegation of"legislative fctions" has been repudiated. G
Similarly, varying according to the necessities of the case and the
nature of the legislation, the doctrine of conditional legislation or
subsidiary legislation or ancillary legislation is equally upheld under
all the Constitutions. In my opinion, therefore, the contention urged
by the learned Attorney General that legislative power carries with
H
544 SUPREME COURT REPORTS [2004] SUPP: 4 S.C.R.

A it a general power to delegate legislative functions, so that the
legislature may not define its policy at all and may lay down no rule
of conduct but that whole thing may be left either to the executive
authority or administrative or other body, is unsound and not
supported by the authorities on which he relies. I do not think that
·apart from the sovereign character of the British Parliament which
B
is established as a matter ofcorivention and whose powers are also
therefore absolute and unlimited in any legislature of any other
country. such general powers of delegation as claimed by the
Attorney-General for a legislature have been recognized_ or
permitted."
c (emphasis supplied)

Keeping in view the Parliamentary position in India in juxtaposition of
British system, His Lordship proceeded to state:

"Having regard to the position of the British Parliament, the
question whether it· can validly delegate its legislative functions
cannot be raised in the court of law. Therefore from the fact that
the British Parliament has delegated legislative powers it does not
follow that the power of delegation is recognized in law as
necessarily include din the power of legislation. Although in the
E Constitution of India there is no express separation of powers, it is
clear that a legif:lature is created by the Constitution and detailed
provisions are made for making that legislature pass laws. Is it then
too much to say that under the Constitution the duty to make laws,
the duty to exercise its own wisdom, judgment and patriotism in
F making laws is primarily cast on the legislatures? Does it not imply
that unless it can be gathered from other provisions of the Constitution,
other bodies, executive or judicial, are not intended to discharge
legislative functions? I am unable to read the decisions to which
our attention has been drawn as laying down that once a legislature
observes the procedure prescribed for passing a bill into an Act, it
G becomes a valid law, unless it is outside the Legislative Lists in the
Seventh Schedule prescribing its respective powers. I do not read
articles 245 and 246 as covering the question of delegation of
legislative powers. In my opinion, on a true construction of articles
245 and 246 and the Lists in the Seventh Schedule, construed in the
H light of the judicial decisions mentioned above, legislation delegating
M.P. HIGH COURT BAR ASSON. v. U.O.I. [THAKKER, J.] 545

legislative powers on some other bodies is not a law on any of the A
subjects or entries mentioned in the Legislative Lists. It amounts
to a law which states that instead of the legislature passing laws on
any subject covered by the entries, it confers on the body mentioned
in the legislation the power to lay down the policy of the law and
make a rule of conduct binding on the persons covered by the law." B
Our attention has also been invited to similar observations of Faz! Ali,
J., who said:

"There can be no doubt that if the legislature completely
abdicates its functions and sets up a parallel legislature transferring c
all its power to it, that would undoubtedly be a real instance df
delegation of its power. In other words, there will be delegation in
the strict sense iflegislative power with all its attributes is transferred
to another authority. But the Privy Council have repeatedly pointed
out that when the legislature retains its dominant power intact and D
can whenever it pleases destroy the agency it has created and set
up another or take the matter directly into its own hands, it has not
parted with its own legislative power. They have also pointed out
that the act of the subordinate authority does not possess the true
legislative attribute, ifthe efficacy of the act done by it is not derived
from the subordinate authority but from the legislature by which the
E
subordinate authority was entrusted with the power to do the act. In
some of the cases to which reference has been made, the Privy
Council have referred to the nature and principles of legislation and
pointed out the conditional legislation simply amounts to entrusting
a limited discretionary authority to others, and that to seek the aid
of subordinate agencies in carrying out the object of the legislation
is ancillary to legislation and properly lies within the scope of the
powers which every legislature must possess to function effectively."

(emphasis supplied)
G
Reference was also made to the following conclusions reached by His
Lordship:

"The conclusions at which I have arrived so far may now be
summed up:
H
546 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A (1) The legislature must normally discharge its primary legislative
function itself and not through others.

(2) Once it is established that it has sovereign powers within a
certain sphere, it mu0 t follow as a corollary that it is free to
legislate within that sphere in any way which appears to it to
B be the best way to give effect to its intention and policy in
making, a particular law, and that it may utilize any outside
agency to any extent it finds necessary for doing things which
it is unable to do itself or finds it inconvenience to do. In other
words it can do everything which is ancillary to and necessary
c for the full and effective exercise of its power of legislation.

(3) It cannot abdicate its legislative functions, and therefore while
entrusting power to an outside agency it must see that such
agency, acts as a subordinate authority and does not become
a parallel legislature.
D
(4) The doctrine of separation of powers and the judicial
interpretation it has received in America ever since the American
Constitution was framed, enables the American courts to check
undue and excessive delegation but the courts of this country
are not committed to that doctrine and cannot apply it in the
E
same way as it has been applied in America. Therefore, ther_e
are only two main checks in this country on the pow~r of
legislature to delegate, these being its good .sense an~ the
principal that it should not cross the line beyond which
delegation amounts to "abdication and self-effacement."
F
On the basis of the above observations, it was submitted by Mr. Prashant
Bhushan that by the impugned legislation, Parliament has delegated essential
legislative functions in favour of the State Government. Such delegation is
blanket and unchartered and is of essential legislative function and legislative
policy which could not have been done. The Hig~ Court has committed an
G error of law in upholding such delegation which was in substance and reality
"excessive delegation". The order passed by the High Court to that extent
suffers from legal infirmity and deserves to be interfered with by holding sub-
section (1) of Section 74 of the Act of 2000 ultra vires.

The High Court, however, was not impressed by the argument. In the
H
M.P. HIGH COURT BAR ASSON. v. U.O.I. [THAKKER, J.] 547

opinion of the High Court, sub-section (l) of Section 74 of the Act of 2000 A
was not in the nature of "delegated legislation" but was "conditional
legislation". Taking note of distinction between delegated legislation and
conditional legislation, the High Court held that the power conferred by
Parliament on the State Government to abolish Tribunal on fulfillment of
conditions specified in sub-section (1) of Section 74 of the Act of2000 co-µld B
not be objected.

We find no infinnity in the approach of the High Court. In Hamdard
Dawakhana v. Union of India, [1960] 2 SCR 671, speaking for the
Constitution Bench, Kapur, J., said;
c
"The distinction between conditional legislation and delegated
legislation is that in the fonner the delegate's power is that of
detennining when a legislative declared rule of conduct shall
become effective; Hampton & Co. v. US., 276 US 394 : 72 L Ed
624 (1928) and the latter involves delegation of rule-making power
which constitutionally may be exercised by the administrative agent.
D
This means that the legislature having laid down the broad principles
of its policy in the legislation can then leave the details to b~
supplied by the administrative authority. In other words by
delegated legislation the delegate completes the legislation by •
supplying details within the limits prescribed by the statute and in E
the case of conditional legislation the power of delegation is
exercised by the legislature conditionally leaving to the discretion
of an external authority the time and manner of carrying its
legislation into effect as also the detennination of the area to which
it is to extend; (R v. Burah, [1878] 3 AC 889, PC; Russell v. R,
[1882] 7 AC 829 at p. 835 : 51 LJPC 77, PC; King Emperor v.
F
Benoari Lal Sarma, [1944] 72 IA 57 : AIR (1945) PC 48; Sardar .
lnder Singh v. State of Rajasthan, AIR (1957) SC 510: [1857] SCR
605. Thus when the delegate is given the power of makir1g rules
and regulations in order to fill in the details to carry out and
subserve the purposes of !he legislation the manner in which the G
requirements of the statute are to be met and the rights therein
created to be enjoyed it is an exercise of delegated legislation. But
when the legislation is complete in itselfand the legislature has itself
made the law and the only function left to the delegate is to apply
the law to an area or to determine the time and manner of carrying
H
548 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A it into effect, it is conditional legislation. "
(emphasis supplied)

We may also refer in this connection to a decision of this Court in
Sardar lnder Singh v. State of Rajasthan, [1957] SCR 605. There the
B Rajasthan Tenants' Protection Ordinance was promulgated for two years. By
Section 3, the Rajpramukh was empowered to extend the life of the
Ordinance by issuing a notification, if required. The duration of the Ordinance
was extended by issuing a notification which was challenged. This Court,
however, upheld the provision observing that it was a case of conditional
legislation.
c
The Court said;

"In the present case, the preamble to the Ordinance clearly
recites the state of facts which necessitated the enactment of the law
D in question, and s.3 fixed the duration of the Act as two years, on
an understanding of the situation as it then existed. At the same
time, it conferred a power on the Rajpramukh to extend the life of
the Ordinance beyond that period, if the state of affairs then should
require it. When such extension is decided by the Rajpramukh and
notified, the law that will operate is the law which was enacted by
E the legislative authority in respect of "place, person, laws, powers",
and it is clearly conditional and not delegated legislation as laid
down in The Queen v. Burah, [1878] 5 I.A. 178, and must, in
consequence, be held to be valid."

p Referring to Sardar Inder Singh .and reiterating the principle laid down
therein, this Court in State of TN represented by Secretary, Housing
Department, Madras v. K. Sabanayagam & Anr., [1998] 1 SCC 318,
speaking through S.B. Majmudar, J., stated;

"It is thus obvious that in the case of conditional legislation,
G the legislation is complete in itself but its operation is made to
depend on fulfillment of certain conditions and what is delegated to
an outside authority, is the power to determine according to its own
judgment whether or not those conditions are fulfilled. In· case of
delegated legislation proper, some portion of the legislative power
H of the legislature is delegated to the outside authority in that, the
M.P. HIGH COURT BAR ASSON. v. U.O.I. [THAKKER, J.] 549

legislature, though competent to perform both the essential and A
ancillary legislative functions, performs only the former and parts
with the latter, i.e., the ancillary function of laying down details in
favour of another for executing the policy of the statute enacted.
The distinction between the two exists in this that whereas conditional
legislation contains no element of delegation of legislative power B
and is, therefore, not open to attack on the ground of excessive
delegation, delegated legislation does confer some legislative power
on some outside authority and is therefore open to attack on the
ground of excessive delegation."

In the case on hand also, the Act of 2000 as enacted by Parliament was C
full and complete when it left legislative chamber. There was, therefore, no
question of delegation of legislative power by the legislature in favour of the
executive. What was left to the executive was merely to decide whether to
continue the Administrative Tribunal or to abolish it. The State Government,
after considering the facts and 'circumstances decided not to continue the D
Tribunal which was within the power of the State Government and, hence,
no objection can be raised against exercise of such power. The contention
of the appellants, therefore, cannot be upheld.

The matter can be looked at from another angle also. As already
indicated in the earlier part of the judgment, Article 323A is not self- E
executory. The said provision did not create or establish Administrative
Tribunals. It was merely a permissive or an enabling provision allowing
Parliament to make law to establish Administrative Tribunal if it wished to
do so. Thus, there was no binding requirement on the part of the Parliament
(or State Legislature) to cl'.eate such a forum as contemplated by Article 323A p
of the Constitution of India. It also cannot be overlooked that the
Administrative Tribunal in question was to be created for a particular State,
i.e. State of Madhya Pradesh. Neither under Article 323A of the Constitution
nor under the Administrative Tribunals Act, 1985, the Central Gove:nment
could have created such Tribunal ·except in aecordance with the provisions
of sub-section (2) of Section 4 of the said Act. As already noted, the Central G
Government could exercise the jurisdiction, power and authority conferred
on the Administrative Tribunal for the State by or under the said Act only
"on receipt of a request in this behalf from any State Government".
Essentially therefore, it was on the request made by the State of Madhya
Pradesh to the Central Government that the power to create and establish H
550 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A Administrative Tribunal in the State of Madhya Pradesh was exercised by
the Central Government and the Tribunal was established. We, therefore, see
no objection in conferring the power on the State Government to continue
or to abolish such Tribunal. In our considered opinion, there is no ex<:essive
delegation by Parliament to the State Government which would be hit either
B by the provisions of the Constitution or the law laid down in In re: The Delhi
Laws Act, 1912 or other decisions of this Court.

.. The learned counsel for the appellants contended that for abolishing
State Administrative Tribunal, the State of Madhya Pradesh took into account
the report of the Arrears Committee (Malimath Committee). Even in the
C affidavit in reply, reliance was placed on the report of the said Committee.
It was urged that this Court in L. Chandra Kumar did not fully endorse the
views expressed by the Malimath Committee. ·Quoting certain
recommendations on "functioning of Tribunals", the Malimath Committee
specifically recommended that the theory of alternative institutional
D mechanisms should be abandoned. It also suggested that institutional
changes should be carried out within the High Courts dividing them into
separate divisions for different branches of law as has been done in England.
According to the Committee, appointment of more Judges would be a better
way of remedying the problem of pendency in High Courts.

E This Court, while dealing with the constitllltional validity of Article
323A of the Constitution and ouster of jurisdiction of High Courts considered
the report of the Committee and observed that "its recommendation is not
suited to our present context". The Court, however, conceded that various
Tribunals have not performed up to the· expectation was "self-evident and
F widely acknowledged truth". But, the Court.proceeded to state that "to draw
an inference that their unsatisfactory performanc:e points to. their being
founded on -a fundamentally unsound principle would not be correct".
According to the Court, "the reasons for which the Tribunals were constituted
still persist; indeed those reasons have become even more pronounced in our
times".
G
The endeavor of the learned counsel is to impress upon the Court that
the reasons which weighed with the State Government in taking a decision
to abolish the State Administrative Tribunal were illegal, . non-existent, ·
irrelevant and ill-founded .. Once this Court has held that existence of such
H Tribunals is a "need for the day" and the observations of the Arrears
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 55 l

Commi_ttee could not be said to be well-founded, no action of abolishing the A
State Administrative Tribunal could be taken by the State Government.

The contention of the learned counsel cannot be upheld. It is true that
the State of Madhya Pradesh had considered the report of the Arrears
Committee and the functioning of State Administrative Tribunal in the State B
of Madhya Pradesh, but it is equally true that when a request was made by
the State of Madhya Pradesh to the Central Government for establishment
of State Administrative Tribunal and the decision was taken by the Central
Government to create such Tribunal and a notification was issued in 1988
and the Tribunal was established, the law governing the field was as laid
down in S.P. Sampath Kumar. L. Chandra Kumar had not seen the light of C
the day. It was after the order of Reference in R.K. Jain v. Union of India,
(1993] 4 SCC fl9 that a Division Bench of this Court in L. Chandra Kumar
V. Union of India, (1995] l sec 400 referred the matter to a Bench of seven
Judges concluding that "the decision rendered by five-Judge Constitution
Bench in S.P. Sampath Kumar needs to be comprehensively reconsidered". D
It is also pertinent to note that seven-Judge Bench overruled S. P. Sampath
Kumar and unanimously held that power, authority and jurisdiction of High
Courts under Articles 226 and 227 cannot be taken away even by an
amendment in the Constitution. Clause (d) of Article 323A (2) and Clause
(d) of Article 323B (3) of the Constitution, therefore, were held ultra vires.
The resultant effect of L. Chandra Kumar was that after an order is passed E
by State Administrative Tribunal, an aggrieved party could approach the
High Court by invoking writ/supervisory jurisdiction under Article 226/227
of the Constitution of India. So much so that after the decision by the
Administrative Tribunal, the aggrieved party was required to approach the
High Court before approaching this Court under Article 136 of the Constitution. p
In this connection, it may be necessary to bear in mind the following
observations in L. Chandra Kumar:-

"We may add here that under the existing system, direct
appeals have been provided froin the decisions of all Tribunals to G
the Supreme Court under Article 136 of the Constitution. In view
of our above-mentioned observations, this situation will also stand
modified. In the view that we have taken, no appeal from the

• decision of a Tribunal will directly lie before the Supreme Court
undtr Article 136 of the Constitution; but instead, the aggrieved H
552 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.
"':--
A party will be entitled to move the High Court under Articles 226/
227 of the Constitution and from the decision of the Division Bench
of the High Court the aggrieved party could move this Court under
Article 136 -of the Constitution."

From the discussion hereinabove, it is clear that after the Constitution
B
(42nd Amendment) Act, 1976, the Administrative Tribunals Act, 1985 came
to be enacted by. Parliament. The position prevailed at that time was the
law laid down by the Constitution Bench of this Court in S.P. Sampath
Kumar. Invoking sub-section (2) of Section 4 of the Administrative Tribunals
Act, 1985, the State of Madhya Pradesh requested the Central Government
c to constitute a Tribunal for civil servants in the State. It was also on the basis
of pronouncement of law in S.P. Sampath Kumar. The notification was
issued by the Central Government in 1988 and the State Administrative ......
Tribunal was established for the State of Madhya Pradesh. At that time, as
per well-settled legal position, decisions rendered by the Administrative
D Tribunals constituted under the Act of 1985 were "final" subject to jurisdiction
of this Court under Article 136 of the Constitution. No person aggrieved by
a decision of State Administrative Tribunal could approach the High Court
of Madhya Pradesh in view of Clause (d) of Article 323A (2) of the
Constitution read with Section 28 of the Act of 1985 and the declaration of
law in S.P. Sampath Kumar. If, in view of subsequent development of law .
E in L. Chandra Kumar, the State of Madhya Pradesh felt that continuation of
State Administrative Tribunal would be "one more tier" in the administration
of justice inasmuch as after a decision is rendered by the State Administrative
Tribunal, an aggrieved party could approach the High Court under Article
226/227 of the Constitution of India and, hence, it felt that such tribunal
F should not be continued further, in our opinion, it cannot be said that such
a decision is arbitrary, irrational or unreasonable. From the correspondence
between the State of Madhya Pradesh and Central Government as well as
from the affidavit in reply, it is clear that the decision of this Court in L.
Chandra Kumar had been considered by the State of Madhya Pradesh in
arriving at a decision to abolish State Administrative Tribunal. Such a
G consideration, in our opinion, was relevant, germane and valid. It, therefore "<'.
cannot be said that the decision was illegal, -invalid or improper.

It was also contended that there is interference with judicial functioning
of the Tribunal by the Executive and such interference would be· violative
of"basic structure of the Constitution" and would result in death knell of Rule
•
H
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 553

of Law. The counsel in this connection, placed reliance on a decision of this A
Court in P. Sambamurthy & Others v. State ofAndhra Pradesh and Another,
[ 1987] l sec 362. In that case, Vires of Clause (5) of Article 3 7 lD of the
Constitution was challenged before this Court. Article 371D was inserted
in the Constitution by the Constitution (32nd Amendment) Act, 1983.
B
The said clause read as under:-

"37 JD. Special provisions with respect to the State ofAndhra
Pradesh-

(5) The order of Administrative Tribunal finally disposing of any C
case shall become effective upon its confirmation by the State
Government or on the expiry of three months from the date on
which the order i~ made, whichever is earlier.

Provided that the State Government may, by special
order made in writing and for reasons to be specified D
therein, modify or annul any order of the Administrative
Tribunal before it becomes effective and in such a case, the
order of the Administrative Tribunal shall have effect only in
such modified form or be of no effect, as the case may be. "
(emphasis supplied) E
The reading of above clause makes it clear that it empowered the State
Government to decide whether it would confirm the order, to modify it or even
to annul it. Takingjudicia'I notice of the fact that "almost invariably in every
service dispute before the Administrative Tribunal" the State Government
was a party, this Court noted with concern that the said party was granted F
ultimate authority to uphold or reject the determination of Administrative
Tribunal. This Court, in the circumstances, held the provision unconstitutional
and ultra vires.

Speaking for the Court, Bhagwati, C.J. observed:
G
"It would be open to the State Government, after it has lost
before the Administrative Tribunal, to set at naught the decision
given by the Administrative Tribunal against it. Such a provision
is, to say the least, shocking and is clearly subversive of the
principles of justice. How can a party to litigation be given the H
554 SUPREME COURT REPORTS (2004] SUPP. 4 S.C.R.

A power to override the decision given by the Tribunal in the litigation,
without violating the basic concept of justice? It would make a
mockery of the entire adjudicative process. Not only is the power
conferred on the State Government to modify or annul the decision
of the Administrative Tribunal starling and wholly repugnant to our
B notion of justice but it is also a power which can be abused
misused."
(emphasis supplied)

Putting the problem on a high pedestal, the Court aaded;

c "This power of modifying or annulling an order of the
Admirtistrative Tribunal conferred on the State Government under
the proviso to dause (5) is violative of the rule of law which is
clearly_ a basic and essential feature of the Constitution. It is a basic
principle of the rule of law that the exercise of power by the
executive or any other authority must not only be conditioned by
D the Constitution but must also be in accordance with law and the
power of judicial review is conferred by the Constitution with a view
to ensuring that the la"'. is observed and there is compliance with
the requirement of law on the part of the executive and other
authorities. It is through the power of judicial review conferred on
E an independent institutional authority such as the High Court that
the rule of law is maintained and every organ of the State is kept
within the limits of the law. Now if the exercise of the power of
judicial review can be set at naught by the State Government by
overriding the decision given against it, it would sound the death-
knell of the rule of law. The rule of law would cease to have any
F
meaning, because then it would be open to the State Government
to defy the law and yet to get away with it. The proviso to clause
(5) of Article 3 71-D is therefore clearly violative of the basic
structure doctrine".
(emphasis supplied)
G
In our considered opinion, P. Sambamurthy has no application to the
facts of the case. In that case, the Executive (Government), a party to the
proceeding was authorized to interfere with a decision rendered by a quasi-
judicial authority (Tribunal). Such a course cannot be allowed in a democratic
. H country and in a judicial system governed by Rule of Law. It would totally
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 555

destroy the independence of judiciary. It was in the light of the said fact that A
the provision was held ultra vires and unconstitutional.

In the instant case, there is no interference with a "judicial order" passed
by a competent court or a Tribunal, but a "policy decision" has been taken
by the State Government to abolish State Administrative Tribunal allowing B
aggrieved litigants to approach appropriate authority/court for ventilating
their grievances. The ratio laid down in P. Sambamurthy, therefore, does not
apply and the contention cannot be upheld.

It was also contended that it is the Central Government which can issue
a notification under sub-section (4) of Section 74 of the Act of2000. Hence, C
even if it is assumed that the Tribunal can be abolished, the power has been
vested in the Central Government. It is the Central Government which is
required to issue directions for resolution of any matter relating to any body
referred to in sub-section (1) of Section 74. Since no action has been taken
by the Central Government, abolition of the Tribunal is illegal and unlawful.
D
On behalf of the State of Madhya Pradesh, however, it was submitted
that the interpretation put forward by the appellants was not correct and
reliance on sub-section (4) of Section 74 was misconceived and ill-founded.
Sub-section (4) of Section 74 of the Act of2000 has limited application and
could be invoked in case there is dispute between the successor States, but E
not otherwise. "When both the States mutually agreed for a decision, the
Central Government has neither any discretion nor any role has been given
to the Central Government". The contention, therefore, has no force.

·considering the provisions of sub-section (4) of Section 74, the High
Court stated; F
"A fair reading of the above sub-section (4) of Section 74 of
. the Act of 2000 makes it clear that the above contention raised by
the learned counsel appearing for the petitioners is not based on
proper and correct interpretation of sub-section (4) of Section 74 of
the Act of 2000. · If both the successor States decide by mutual
G
agreement to abolish the Tribunal, as envisaged in sub-section (1)
of Section 74 of the Act of2000, it is not obligatory for the Central
Government to issue directions as envisaged in above sub-section
(4) of Section 74. This sub-section does not contain any provision,
about the issuance of notification by the Central Government for the H
556 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A abolition of the Tribunal. An issuance of notification is a mandatory
requirement as the Tribunal was established by a notification issued
by the Central Government. The sub-section (4) of Section 74 of
the Act of 2000 begins with a non-obstante clause which indicates
that the provisions of this sub-section are independent. The
B provisions of sub-section (l) of Section 74 of the Act of 2000 are
not subservient to the provisions of sub-section (4) of Section 74 of
the Act of 2000. If it had be.en so, the words "subject to the
provisions of sub-section (4)" would have been used in sub-section
(1) of Section 74 ofthe Act of2000. Moreover, above sub-section
(4) provides that the Central Government shall issue directions for
c the resolution of any matter relating to any body referred to in sub-
section ( l) within any period referred to in sub-section (I) in
a.ccordance with any mutual agreement between the successor States
or ifthere is no such agreement (emphasis supplied) after consultation
with the Governments of successor States. Obviously if on any
D matter reiating to any body referred to in sub-section (I}, there is
no mutual agreement then the directions could also be issued by the
Central Government after consultation with the Governments of
both the successor States. A fair reading of sub-section (I) of
Section 74 of the Act of 2000, however, makes it clear that the
decision to abolish any of the bodies re~erred to in that clause can
E be taken only by· mu tu.al agreement between the successor States,
therefore' the issuance of "directions" by the Central Government
under sub-section (4) does not include the issuance of"notification"
for the abolition of any of the body referred to in sub-section (1 ).
The abolition of the Tribunal does not require any "direction" from
F the Central Government under sub-section (4) of Section 74 of the
Act of2000. Such direction can only be issued for the "resolution"
of any matter and the decision to abolish the Tribunal taken by the
successor States . by mutual agreement does not amount to a
"resolution" of any matter relating to the Tribunal. The provisions
of sub-section (4) is only in the nature of further supplemental
G ancillary, or consequential provisions to further the aims, objects
and stopgap arrangement envisaged under sub-section (1) of Section
74 of the Act of 2000. The word "direction for resolution" means
direction regarding some defect or deadlock persists requiring
intervention of the Central Government in relation to the functioning
H of that body within a period referred to in sub-section (l)."

. I
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 557

We fully agree with the interpretation of the High Court. In our A
judgment, the High Court was right in observing that Section 74(1) is not
subservient to Section 74(4) of the Act and once the provisions of sub-section
( 1) of Section 74 of the Act are attracted and invoked, the provisions of sub-
section (4) of Section 74 has no application. The contention of the appellants,
therefore, has rio force and has to be rejected. B
It was also argued that even if this Court comes to the conclusion that
sub-section ( 1) of Section 74 of the Act of 2000 is intra-vires and constitutional
confirming the view taken by the High Court, the impugned action of
abolishing State Administrative Tribunal is ma/a fide and malicious. For this,
learned counsel referred to certain press reports wherein it had been alleged c
that a decision had been taken at the Cabinet Meeting of the State Government
to abolish State Administrative Tribunal as the Chief Minister and all the
Ministers were of the view that State Administrative Tribunal had granted
stay in many transfer matters. The attempt on the part of the learned counsel
for the appellants was that the action has been taken by the State of Madhya D
Pradesh because of adverse verdicts by the State Administrative Tribunal. In
other words, according to the appellants, action of abolishing State
Administrative Tribunal was taken because of "judicial orders" passed by the
Tribunal which was not liked by the State Government. Such an action,
submitted the learned counsel, cannot be sustained in law.
E
Now, it may be stated that there is no concrete material on record to
show that the decision to abolish State Administrative Tribunal was taken
because of orders passed by the State Administrative Tribunal. Except bald
assertions by the appellants and Press cuttings, there is nothing to substantiate
such allegations. On the contrary, sufficient material is available on record
F
to show what weighed with the respondent-State in taking a decision to
abolish the Tribunal. So far as allegations by the appellants are concerned,
they were emphatically denied by the State of Madhya Pradesh by filing a
counter-affidavit. Moreover, the Advocate General, appearing for the State
of Madhya Pradesh placed chronological events in detail before the High
Court which were as under : G

(i) On 8.3.2001 Cabinet took decision to abolish the Tribunal.
The decision was communicated to Press as usual. To
communicate the decision of the Cabinet to the Press is no
• :1
crime. H
558 SUPREME COURT REPORTS [2004) SUPP. 4 S.C.R.
·,
A (ii) On 18.3.2001 a letter was sent to the Government of
Chhattisgarh informing about the decision taken by the
Government of M.P. to abolish Tribunal w.e.f. 30.4.2001.

(iii) On 27.3.2001 a reply from the Government of Chhattisgarh
was received seeking further information etc. as the Chhattisgarh
B
Government had no power.

(iy) On 3.4.2001 second letter from the Government of Chhattisgarh
was received reminding that they were waiting fro reply of the
Government of Madhya Pradesh.
c
(v) O!J 3.4.2001 i.e. the same day the reply was sent by the
qoverm~ent of Madhya Pradesh to the Government of
Chhattisgarh giving reasons for abolition of the Tribunal and
also suggesting to constitute own Tribunal, if so desired.

D (yi) On 26.4.2001 both the State Government agreed to abolish the
Tribunal for both the States.

(vii) On 5.5.2001 ·a letter was written by the Government of
Madhya Pradesh to Central Government to abolish the Tribunal
w.e.f. 1.6.2001. ·
E
(viii) On 17.7.2001 order was passed by the Tribunal which is
alleged to be the ground for abolition of the Tribunal.

(ix) On 23.7.2001 a letter was teceived by the Government of
F Madhya Pradesh from the Government of Chhattisgarh again
reiterating to abolish the Tribunal."

Thus, from the correspondence benyeen the State of Madhya Pradesh
and the Central Government and from ·various letters and communications
and also from the decision which has been taken by the Cabinet, it is clear
G that the State Government took into account a vital consideration that after
the decision of this Court in L. Chandra Kumar, an aggrieved party could
approach the High Court, the object for establishment of the Tribunal was
defeated. In our opinion, in the light of the facts before the Court, it cannot
be said that the decision to abolish State Administrative Tribunal taken by
H the State of Madhya Pradesh can be quashed and set aside as ma/a fide.
M.P. HIGH COURT BAR ASSON. v. U.0.1. [THAKKER, J.] 559

It was finally submitted that even on merits, the action of abolition of A
State Administrative Tribunal was unwarranted and uncalled for. For that,
the counsel invited· our attention to facts and figures and stated that it is not
that all the cases decided by the State Administrative Tribunal reached the
High Court of Madhya Pradesh. In most of the cases dealt with by the State
Administrative Tribunal, the parties accepted the orders of the Tribunal. It B
is only in few cases that the aggrieved party - public servant or government
- approached the High Court. It was also stated that no survey has been made
by the State. No reasons have been recorded why continuance of Tribunal
was not necessary. There was non-application of mind to this very important
aspect and on that ground also, the action deserves to be set aside at least
with a limited direction to the State to reconsider the matter and take an c
appropriate decision afresh keeping in mind all relevant factors.

We are unable to uphold even this argument. In our judgment, if a
decision is illegal, unconstitutional or ultra vires, it has to be set aside
irrespective of laudable object behind it. But once we hold that it was within D
the power of the State Government to continue or not to continue State
Administrative Tribunal and it was open to the State Government to take such
a decision, it cannot be set aside merely on the ground that such a decision
was not advisable in the facts of the case or that other decision could have
been taken. While exercising power of judicial review, this Court cannot E
substitute its own decision for the decision of the Government. The Court,
no doubt, can quash and set aside the decision, if it is illegal, ultra vires,
unreasonable or otherwise objectionable. But that is not the situation here.
To repeat, from the record of the case, it is amply clear that relevant.gennane,
valid and proper considerations weighed with the State Government and
keeping in view development of law and the decision of the larger Bench F
of this Court in L. Chandra Kumar, a policy decision has been taken by the
State Government to abolish State Administrative Tribunal. Parliament also
~mpowered the State Government to take an appropriate decision by enacting
sub-section (I) of Section 74 of the Act of 2000 and in exercise of such
power, the State Government had taken a decisio~. The decision, in our G
opinion, cannot be regarded as illegal, unlawful or otherwise objectionable.
The contention, therefore, has no force and has to be negatived.

For the foregoing reasons, Civil Appeal No. 5327 of 2002 deserves to
be dismissed and is, accordingly, dismissed.
H
560 SUPREME COURT REPORTS [2004] SUPP. 4 S.C.R.

A In view of the above, Civil Appeal Nos. 8292-8295 of 2002 and Civil
Appeal arising out of Special Leave Petition No.22648 of 2002 filed by the
Union of India stand disposed of and Civil Appeal No. 5328 of 2002, Civil
Appeal arising out of Special Leave Petition Nos. 23615-23616 of2002, Writ
Petition No. 369 of 2003, Writ Petition No. 374 of 2003 stand dismissed.
B
In the facts and circumstances of the case, however, there shall be no
order as to costs in all these matters.

v.s.s. Appeals/Petitions dismissed.