Holding

Section 30(2) of the Land Acquisition (Amendment) Act, 1984 is limited to awards made by the Collector or Court between 30 April 1982 and 24 September 1984 and to appellate orders arising from such awards; it does not apply to earlier awards even if the appeal is decided later.

Summary

The Union of India appealed a High Court award of compensation and 30% solatium in a land acquisition case where the original award was made in 1963 and enhanced by a court in 1968. While the appeal was pending, the Land Acquisition (Amendment) Act, 1984 increased the statutory solatium from 15% to 30% and introduced Section 30(2) to define its retrospective reach. The Supreme Court was asked to interpret whether the enhanced solatium applied to awards made before 30 April 1982 but appealed after that date, and whether a two‑Judge Division Bench could overrule an earlier two‑Judge decision. The Court held that Section 30(2) applies only to awards made by the Collector or Court between 30 April 1982 and 24 September 1984 and to appellate orders arising from such awards; it does not extend to earlier awards even if the appeal was decided later. The Court overruled the earlier decisions in Mohinder Singh and Bhag Singh and affirmed the interpretation given in K. Kamalajammanniavaru. It also clarified that a Division Bench decision binds smaller benches, and a larger bench is required when conflicting decisions exist. The reference to a larger Bench was upheld and the matters were listed before a three‑Judge Division Bench for further hearing.

Issues considered

Whether Section 30(2) of the Land Acquisition (Amendment) Act, 1984 applies to awards made before 30 April 1982 but appealed after that date.
Whether the phrase ‘any such award’ in Section 30(2) includes awards made prior to the amendment date.
Whether a Division Bench of two Judges is bound by an earlier Division Bench of the same or larger strength and whether a larger Bench is required to resolve conflicting precedents.

Legislation cited

Land Acquisition Act, 1894s. 11, s. 18, s. 19, s. 23, s. 23(2)
Land Acquisition (Amendment) Act, 1984s. 15, s. 30(2)

Subjects

Land acquisitionSolatiumStatutory amendmentRetrospective applicationSection 30(2)Statutory interpretationBinding precedentDivision BenchSupreme Court of India

Judgment

UNION OF INDIA & ANR.
A
v.
RAGHUBIR SINGH (DEAD) BY LRS. ETC.

MAY 16, 1989

B [R.S. PATHAK CJ, E.S. VENKATARAMIAH,
SABYASACHI MUKHARJI, RANGANATH MISRA AND
S. NATARAJAN, JJ.]

Land Acquisition (Amendment) Act, 1894: Sections 30(2) and
15-Solatium payable under Section 23(2) increased to 30 per cent-
C Amending Section-Whether applicable to awards inade prior to April
30, 1982. Held applies to awards made by the Collector or Court bet-
ween April 30, 1982 and Sept. 1984 and not before-Benefit extends to
appeals taken from such awards only.

Constitution of India-Articles 145, 137 and 141-Decision of a
D Division Bench rendered earlier in point of time-Whether binding on a
subsequent Division Bench comprised of equal number of Judges or of
more Judges.

A common question of law having arisen in this group of cases for
determination by this Court, they were heard together. I
->.._
E
Lands of Respondents in Civil Appeal Nos. 2839-40 of 1989 were
acquired under the Land Acquisition Act. The Collector made the
award for compensation on March 30, 1963 and on a reference, being
made under Section 18 of the Act, the Additional District Judge
enhanced the compensation by his order dated June IO, 1968. The
F Respondents appealed to the High Court seeking further enhancement.
During the pendency of the appeal, Land Acquisition (Amendment) Bill 1982
-J:
·
was introduced on April 30, 1982 and became an Act on Sept. 24, 1984. The
High Court disposed of the appeal on Dec. 4, 1984 and apart from
raising the quantum of compensation, also awarded a solatium at 30 per
cent in terms of the Amendment Act 1984. The State appealed to this
G Court.

The matter initially came up before ll Division Bench on Septem-
ber 23, 1985. The Bench had before it two decisions of this Court
wherein divergent views were expressed. The two decisions were: In

H K. Kamalajammanniavaru's (dead) by Lrs. v. Special Land
316
U.0.1. v. RAGHUBIR SINGH 317

Acquisition Officer,, (1985] 1SCC582. A

This Court (composed of.two Judges) took the view that award of
30 per ceut solatium under the amende«! Section 23(2) by the High
Court or the Supreme Court were applicable only where the award
appealed against was made by the Collector or the Court between April
B
3(\, 1982 and Sept. 24, 1984. In the second decision, Bhag Singh & Ors.
v. Union Territory of Chandigarh, (1985] 3 SCC 737, this Court
(comprised of three Judges) took a contrary view and ruled that even if
an award was made by the Collector or the Court on or before April 30,
1982 and an appeal against such award was pending b·efore the 'High
Court or this Court on 30.4.1982 or was filed subsequent to that date,
the provisions of amended Section 23(2) anq 28 of the Land Acquisition c
Act would be applicable as the appeal was a continuation of the refer-
ence made under Section 18 and as such the appellate Court must apply
the amended provision on the date of the decision of the appeal. In this
way the decision in Kamalajammanniavaru's case was overruled by this
Court in Bhag Singh's case and the Court approved another decision of
D
Division Bench comprised of three Judges in Mohinder Singh's case
(1986) 1, SCC 365 which merely directed payment of enhanced solatium
and interest without giving any reasons.

In view of the conflicting decisions on the point of two Judges
Bench before, whom these cases come up for consideration, referred to
E
this Larger Bench the question: whether under the Amended Section
23(2), the claimants were entitled to solatium at 30 per cent of the
market value irrespective of the dates on which the land acquisition
proceedings were initiated or on the dates on which the award had been
passed.
F
Overruling the preliminary objection as to the maintainability of
the reference of matters to a larger Bench, this Court disposing or the
reference and directing that the appeals be now listed for hearing on
merits,

HELD: Solatium is awarded under sub-section (2) of Seeton 23 of
the Land Acquisition Act. Before the Amendment Act was enacted, the G
Sub-section provided for solatium at 15 per cent of the market value. By
the change introduced by the Amendment Act the amount has been
raised to 30 per cent of the market value. Sub-section (2) of Section 30
of the Amendment Act specifies the category of cases to which the
amended rate ofsolatium is attracted. [322D] H
318 SUPREME COURT REPORTS [1989) 3 S.C.R.

What Parliament intends to say is that the benefit of Section 30(2)
A
will be available to an award by the Collector or the Court made bet-
ween 30th April 1982 and 24th September 1984 or to an appellate order
of the High Court or of the Supreme Court which arises out of an award
of the Collector or the Court made between the two said dates. The
word 'or', is used with reference to the stage at which the proceeding
B rests at the time when the benefit under Section 30(2) is sought to be
extended. If lhe proceeding bas terminated with the award of the
Collector or of the Court made between the aforesaid two dates, the
benefit of Section 30(2) will be applied to such award made between the
aforesaid two dates. If the proceeding has passed to the stage of dppeal rt'--
before the High Court or the Supreme Court, it is at that stage when the / \ .
C benefit of Section 30(2) will be applied. But in every case the award of
the Collector or of the Court must have been made between April 30,
1982 and September 24, J984. [339D-G I

A pronouncement of law by a Division Bench of this Court is
binding on a Division Bench of the same or a smaller number of Judges,
D and in order that such dedsion be binding, it is not necessary that it
should be a decision rendered by the full Court or a Constitution Bench
of the Court. For the purpose of imparting certainty and endowing due
authority, decisions of this Court in the future should be rendered by
Division Benches of at least three Judges unless, for compelling reasons I
,..__
that is not conveniently possible. [337C-D)
E
The Land Acquisition Bill 1982, was introduced in the House of
the People on 30th April, 1982 and upon enactment the Land Acquisi-
tion Act, 1984, commenced operation with effect from 24th Sept. 1984.
Section 15 of the Amendment Act amended Section 23(2) of the parent
Act and substituted the words "30 per cent" in place of the words "JS
F per cent". Parliament intended that the benefit of the enhanced
solatium should be made available albeit to a limited degree even in
respect of acquisition proceedings taken before the date. It sought to
effectnate that intention by enacting Section 30(2) in the Amendment
Act. l337G-H; 338A)

G There can be no doubt that the benefit of the enhanced solatium is
intended by Section 30(2) in respect of an award made by the Collector
between 30th April 1982 and 24th September 1984. Likewise the benefit ).-
of the enhanced solatium is extended by Section 30(2) to the case of an
award made by the Court between April 30, 1982 and September 24,
1984, even though it be upon reference from an award made before
H April 30, 1982. [338E)
U.0.1. v. RAGHUBIR SINGH. 319

~ One of the functions of the Superior Judiciary in India is to ex- A
amine the competence and validity of legislation both in point of legisla-
tive competence as well as its consistency with the Fundamental Rights.
In this regard the Courts in India possess a power not known to tbe
English Conrts. [323G-H]

Exp. Canon Selwyn, [1872] 36 JP 54 and Cheney v. Conn, [1968] B
I, All ER 779, referred to.

The range of judicial review recognised in the Superior Judiciary
of India is perhaps the widest and the most extensive known to the
world of law. The power extends to examining the validity of even an
amendment to the Constitution for now it has been repeatedly held that
no Constitutional amendment can be sustained which violates the basic c
structure of the Constitution. [324B I

His Holiness Kesavananda Bharti Sripadagalavaru v. State of
Kera/a, [1973] Suppl. SCR l; Smt. Indira Nehru Gandhi v. Shri Raj
Narain, [1976] 2 SCR 347; Minerva Mills Ltd. and others v. Union of D
India and others, [1980] 2 SCC 591; S.P.- Sampath Kumar etc. v. Union
of India and Ors., [1987] l SCR 435.

The Court overruled the statement of the law laid down in the
) cases of State of Punjab v. Mohinder Singh & Anr. and Bhag Singh and
Others v. Union Territory of Chandigarh and preferred the interpreta- E
tion of Section 30(2) of the Amendment Act rendered in K. Kamalajam-
manniavaru (dead) by Lrs. v. Special Land Acquisition Officer.

Oliver Wendell Holmes, "The Common Law", p. 5; Oliver
Wendell Homes, "Common Carriers and the Common Law'', [1943] 9
Curr. L.T. 387, 388; Julius Stone, "Legal Systems & Lawyers Reason- F
ing", p. 58-59; Roscoe Pound, "An Introduction to the Philosophy of
Law", p. 19; "The Judge as Law Maker", pp. 25-6.

Myers v. Director of Public Prosecutions, L.R. 1965 A.C. 1001 &
1021; The Bengal Immunity Company Limited v. The State of Bihar
and Others, [1955] 2 SCR 603; Street Tramways v. London County G
Council, 1898 A.C. 375; Radcliffe v. Ribble Motor Services Ltd., 1939
A ..C. 215; 245; Dr. Alan Paterson's "Law Lords", [1982] pp. 156-157;
Jones v. Secretary of State for Social Services, [1972] A.C. at 966;
Ross-Smith v. Ross-Smith, ll963] A.C. 280, 303; Indyka v. Indyka,
[1969] I A.c. 33, 69; Construction b! Jones, at 966; Steadman v.
Steadman, [1976] A.C. 536, 542; DPP v. Myers, [l96S] A.C. 1001, H
320 SUPREME COURT REPORTS [1989] 3 S.C.R.

1022; Cassell v. Broome, [1972] A.C. 1027, 1086; Haughton v. Smith,
A
[1975] A.C. 476, 500; Knuller v. DPP, [1973] A.C. 435, 455; Conwayv.
Rimmer, [1968] A.C. 910, 938; Tramways case, [1914] 18 C.L.R. 54;
State of Washington v. Dawson & Co., 264 U.S. 646, 68 L. Ed. 219;
David Burnet v. Coronado Oil & Gas Company, 285 U.S. 393, 76
L.Ed. 815; Compare National Bank v. Whitney, 103 U.S. 99, 26 L.Ed.
B 443-444; Compensation to Civil Servants, L.R. 1929 A.C. 242, A.I.R.
1929 P.C. 84, 87; Attorney-General of Ontario v. The Canada Temper-
ance Federation, L.R. 78 I.A. 10; Phanindra Chandra Neogy v. The
King, [!953] S.C.R. 1069; State of Bombay v. The United Motors (In-
dia) Ltd., [1953] S.C.R. 1069; Magan/al Chhagganlal (P) Ltd. v. Mun-
icipal Corporation of Greater Bombay & Ors., [1975] 1 SCR I; Lt. Col.
Khajoor Singh v. The Union of India & Anr., [1961] 2 SCR 828;
C Keshav Mills Company v. Commissioner of Income Tax, [1965] 2 SCR
908, 921; Sajjan Sin)ih v. State of Rajasthan, [!965] I SCR 933, 947-
948; Girdhari Lal Gupta v. D.H. Mill, [1971] 3 SCR 748; Pillani Invest-
ment Corporation Ltd. v. I. T.0. 'A' Ward, Calcutta & Anr., [1972]
2 SCR 502; Ganga Sugar Company v. State of Uttar Pradesh, [1980] I
D SCR 769, 782; Javed Ahmed Abdul Hamid Pawala v. State of
Maharashtra, AIR 1985 SC 231; T. V. Vatheeswaran v. The State of
Tamil Nadu, AIR 1983 SC 361; Sher Singh & Ors. v. State of Punjab,
AIR 1983 SC 465; Triveniben v. State of Gujarat, AIR 1989 SC 142;
lohn Martin v. The State of Wes/ Bengal, [1975] 3 SCR 211; Haradhan
Saha v. State of West Bengal, [1975] I SCR 778; Bhut Na1h Mate v.
E State of West Bengal, AIR 1974 SC 806; Mattu/al v. Radhe Lal, [1975] I

-
SCR 127; Acharaya Maharajshri Narandraprasadji Anandprasadji
Maharaj etc. etc. v. The State of Gujarat & Ors., [1975] 2 SCR 317;
Union of India & Ors. v. Godfrey Philips India Ltd., [1985] 4 SCC 369;
fit Ram v. State of Haryana, [1980] 3 SCR 689; Motilal Padampat
Sugar Millsv. State of U.P., [1979] 2 SCR 641.
F
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos.
2839-40 of 1989 etc.

From the Judgment and Order dated 6.12.1984 of the Delhi High
Court in R.F.A. Nos. 113 and 114 of 1968.
G
K. Parasaran, Attorney General, T.S. Krishnamurthy Iyer,
B.R.L. Iyengar, M.S. Gujaral, F.S. Nariman, A.K. Ganguli, K.
Swamy, C.V. Subba Rao, R.D. Agrawala, P. Parmeshwaran, O.P.
Sharma, R.C. Gubrele, K.R. Gupta, R.K. Sharma, K.L. Rathee,
Chandulal Verma, Subhash Mittal, S. Balakrishnan, N.B. Sinha, K.K.
H Gupta, Sanjiv B. Sinha, M.M. Kashyap, P.C. Khunger, Swaraj
U.0.l. v. RAGHUBIR SINGH [PATHAK, O.] 321

Kaushal, Pankaj Kalra, S.K. Bagga, Ravinder Narain, Sumeet Kach-
A
wala, S. Sukumaran, K.R. Nagaraja, S.S. Javali, Ms. Lira Goswami,
D.K. Das; B.P. Singh, Ran]it Kumar, Santosh Hegde, M.N. Shroff,
P.N. Misra, D.C. Taneja, P.K. Jena, A.K. Sanghi and M. Veerappa
for the appearing parties.

The Judgment of the Court was delivered by B

PATHAK, CJ. The question of law referred to us for decision in
these cases is:

"Whether under the Land Acquisition Act, 1894 as
amended by the Land Acquisition (Amendment) Act, 1984
the claimants are entitled to solatium at 30 per cent of the C
market value irrespective of the dates on which the acquisi-
tion proceedings were initiated or the dates on which the
award had been passed"?
•
It would suffice if• we briefly refer to the facts in the Civil Appeals D
arising out of Special Leave Petitions Nos. 8194-8195 of 1985: Union of
India & Anotherv. RaghubirSingh.

The land belonging to the respondents in village Dhaka was
··. __) taken by compulsory acquisition initiated by a notification under-s. 4
of the Land Acquisition Act, 1894 issued on 13 November, 1959. The E
award with regard to compensation was made by the Collector on 30
March, 1963. A reference under-s. 18 of the Act was disposed of by the
Additional District Judge on 10 June, 1968. He enhanced the compen-
sation. The respondents preferred an appeal to the High Court Claim-
ing further compensation. During the pendency of the appeal the Land
Acquisition (Amendment) Bill 1982 was introduced in Parliament on F
30 April, 1982, and became law as the Land Acquisition (Amendment)
Act, 1984 when it received the assent of the President on 24 Septem-
ber, 1984. The High Court disposed of the appeal by its Judgment and
Order dated 6 December, 1984. While it raised the rate of compensa-
tion, it also raised the rate of interest payable on the compensation,
and taking into account the change in the law effected by the Land G
Acquisition (Amendment) Act, 1984 (referred to-hereinafter as "the
Amendment Act") it awarded solatium at 30 per cent of the market
value. The Judgment and Order of the High Court is .the subject of
these appeals.

When these cases came up before a Bench of two learned Judges H
322 SUPREME COURT REPORTS [1989] 3 S.C.R.

A (E.S. Venkataramiah and R.B. Misra, JJ.) on 23 September, 1985,
they referred to two earlier decisions of this Court and expressed the
view that the question set forth above required re-examination by a
larger Bench of five Judges. It was further directed that the other
questions involved in the petitions would be considered after the
aforesaid question had been resolved by the larger Bench. The two
B decisions referred to in the Order of the learned Judges are K.
Kamalajammanniavaru (dead) by Lrs. Ve Special Land Acquisition
·Officer, [1985] 1 S.C.C. 582 decided by 0. Chinnappa Reddy and
Sabyasachi Mukharji, JJ. on 14 February, 1985 and Bhag Singh and
Ors. v. Union Territory of Chandigarh, [1985] 3 S.C.C. 737 decided by
P.N, Bhagwati, C.J., A.N. Sen and D.P. Madon, JJ. on 14 August, 11'-
c 1985. "
Solatium is awarded under sub-s. (2) of s. 23 of the Land Acqui-
sition Act. Before the Amendment Act was enacted the sub-section
provided for solatium at 15 per cent of the market value. By the
change introduced by the Amendment Act the amount has been raised •
b to 30 per cent of the market value. Sub-s. (2) of s. 30 of the Amend-
ment Act specifies the category of cases to which the amended rate of
solatium is attracted. In K. Kamalajammanniavaru, (supra), the two
learned Judges held that sub-s. (2) of s. 30 referred to orders made by
the High Court or the Supreme Court in appeals against an award
\
made between 30 April, 1982 and 22 September, 1984, and that -'\.._ -
E therefore solatium at 30 per cent alone pursuant to sub-s. (2) of s. 30
had to be awarded in such cases only. In Bhag Singh (supra), however,
the three learned Judges held that sub-s. (2) of s. 30 referred to pro-
ceedings relating to compensation pending on 30 April, 1982 or filed
subsequent to that date, whether before the Collector or before the
Cou.rt or the High Court or the Supreme Court, even if they had finally
F terminated before the enactment of the Amending Act. In taking that
view they overruled K. Kamalajammanniavaru, (supra) and approved
of the opinion expressed ·in another case, State of Punjab v. Mohinder
Singh and•another, [1986] 1 S.C.C. 365 decided by S. Murtaza Fazal
Ali, A. Varadarajan and Ranganath Misra, JJ. on 1 May, 1985.

G At the outset, a preliminary objection has been raised by Shri
B.R.L. Iyengar to ·the validity of the reference of these cases to a
larger Bench. He contends that the mere circumstance that a Bench of
two learned Judges finds itself in doubt about the correctness of the
view taken by a Bench of three learned Judges should not provide
reason for referring the matter to a larger Bench. The preliminary
H objection raised by Shri Iyengar has been vigorously resisted by the
U.0.1. v. RAGHUBIR SINGH [PATHAK, CJ.] 323

apellants. Having regard to the submissions made before us, we think
~ it necessary to lay down the law on the point.
A

India is governed by a judicial system identified by a hierarchy of
courts, where the doctrine of binding precedent is a cardinal feature of
its jurisprudence. It used to be disputed that Judges make law. Today,
it is no longer a matter of doubt that a substantial volume of the law B
-1 governing the lives of citizens and regulati11g the functions of the State
flows from the decisions of the superior courts.°'There was a time."
observed Lord Reid, "when it was thought almost indecent to suggest
...._,,,, that Judges make law-They only declare it ........ But we do not
believe in fairy tales any more "The Judge as law Maker" p. 22." In
countries such as the United Kingdom, where Parliament as the legis-
lative organ is supreme and stands at the apex of the constitutional c
~ structure of the State, the role played by judicial law-making is
limited. In the first place the function of the courts is restricted to the
interpretation of laws made by Parliament, and the courts have no
power to question the validity of Parliamentary statutes, the Diceyan
dictum holding true that the British Parliament is paramount and all D
powerful. In the second place, the law enunciated in every-decision of
the courts in England can be superseded by an Act of Parliament. As
Cockburn CJ. observed in Exp. Canon Selwyn, [1872] 36 JP 54.

_) "There is no judicial body in the country by which the
validity of an Act of Parliament could be questioned. An E
act of the Legislature is superior in authority to any Court
of Law".
"'
And Ungoed Thomas J., in Cheney v. Conn, [1968] 1 All ER 779
referred to a Parliamentary statute as "the highest form of law .....
'
~
which prevails over every other form, of law." The position is substan- F
tially different under a written Constitution such as the one which
governs us. The ·Constitution of India, which represents the Supreme
Law of the land, envisages three distinct organs of the State, each with
its own distinctive functions, each a pillar of the State. Broadly, while
Parliament and the State Legislature in India enact the. law and the
Executive government implements it, ·the judiciary sits in judgment .G
not only on the implementation of the law by the Executive but also
on the validity of the Legislation sought to be implemented.: One of
--{ the functions of the superior judiciary in India is to examine the
competence and validity of legislation, both in point of legislative com-
petence as well as its consistency wit!) the Fundamental Rights. In this
regard, the courts in India possess a power not known to the English H
324 SUPREME COURT REPORTS (1989] 3 S.C.R.

A Courts. Where a statute is declared invalid in India it cannot be rein-
stated unless constitutional sanction is obtained therefore by a
constitutional amendment or an appropriately modified version of the
statute is enacted which accords with constitutional prescription. The
range of judicial review recognised in the superior judiciary of India is
perhaps the widest and the most extensive known to the w'orld of law.
B The power extends to examining the validity of even an amendment to
the Constitution, for now it has been repeatedly held that no constitu-
tional amendment can be sustained which violates the basic structure
of the Constitution. (See His Holiness Kesavananda Bharati Sripada-
galavaru v. State of Kera/a, [1973] Suppl. SCR 1; Smt. Indira Nehru
Gandhi v. Shri Raj Narain, [1976] 2 SCR 347; Minerva Mills Ltd. and
C others v. Union of India and others, [1980] 2 SCC 591 and recently in
S.P. Sampath Kumar etc. v. Union of India and Ors., [1987] 1 SCR
435. With this impressive expanse of judicial power, it is only right that
the superior courts in India should be conscious of the enormous
responsibility which rests on them. This is specially true of the
Supreme Court, for as the highest Court in the entire judicial system
D the law declared it is, by Article 141 of the Constitution, binding on all
courts within the territory of India.

Taking note of the hierarchical character of the judicial system in
'I
India, it is of paramount importance that the law declared by this '
Court should be certain, clear and consistent. It is commonly known ~- I
E that most decisions of the courts are of significance not merely because
they constitute an adjudication on the rights of the parties and resolve
the dispute between them, but also because in doing so they embody a
declaration of law operating as a binding principle in future cases. In
this latter aspect lies their particular value in developing the jurispru-
dence of the law.
F
The doctrine of binding precedent has the merit of promoting a
certainty and consistency in judicial decisions, and enables an organic
development of the law, besides providing assurance to the individual
as to the consequence of transaction forming part of his daily affairs.
And, therefore, the need for a clear and consistent enunciation of legal
G principle in the decisions of a Court.

But like all principles evolved by man for the regulation of the
social order, the doctrine of binding precedent is circumscribed in its
governance by perceptible limitations, limitations arising by reference
to the need for re-adjustment in a changing society, are-adjustment of
H legal norms demanded by a changed social context. This need for
U.0.J. v. RAGHUBIR SINGH [PAIBAK, CJ.) 325

l.. -.I adapting the law to new urges-in society brings home the truth of the A
._,~

Holmesian aphorism that "the life of the la.w has not been logic it has
been experience". Oliver Wendell Holmes, "The Common Law" p. 5
and again when he declared in another study that Oliver Wendell
Holmes, "Common Carriers and the Common Law", (1943) 9 Curr.
L. T. 387, 388 "the law is forever adopting new principles from life at
one end," and "sloughing off" old ones at the o<her. Explaining the B
conceptual import of what Holmes had said, Julius Stone elaborated
that ii is by the introduction of new extra-legal propositions emerging .
from experience to serve as premises, or by experience-guided choice
between competing legal propositions, rather than by the operation of
logic upon existing legal propositions, that the growth of law tends to
be determined. Julius Stone, "Legal Systems & Lawyers Reasoning",
pp. 58-59. c

Legal compulsions cannot be limited by existing legal proposi-
tions, because there will always be, beyond the frontiers of the existing
Jaw, new areas inviting judicial scrutiny and judicial choice-making
which could well affect the validity of existing legal dogma. The search D
for solutions responsive to a changed social era involves a. search not
only among competing propositions of law, or competing versions of a
legal proposition, or the modalities of an indeterminacy such as "fair-
ness" Or "reasonableness", but also among propositions from outside
j the ruling law, corresponding to the empirical knowledge or accepted
values of present time and place, relevant to the dispensing of justice E
within the new parameters.

The universe of problems presented for judicial choice-making at
the growing points of the law is an expanding universe. The areas
brought under control by accumulation of past judicial choice may be
large. Yet the areas newly presented for still further choice, because of F
changing social, economic and technological conditions are far from
inconsiderable. It has also to be remembered, that many occasions for
new options arise by the mere fact that no generation looks out on the
world from quite the same vantage-point as its predecessor, nor for the
matter with the same perception. A different vantage point or a diffe-
rent quality of perception often reveals the need for choice-making G
where formerly no alternatives, and no problems at all, were percei-
ved. The extensiveness of the areas for judicial choice at a particular
time is a function not only of the accumulation of past decisions, not
only of changes in the environment, but also of new insights and pers-
pectives both on old problems and on the new problems thrown up by
changes entering the cultural and social heritage. H
326 SUPREME COURT REPORTS [1989] 3 S.C.R.

Not infrequently, in the nature of things there is a gravity-heavy
A
inclination to follow the groove set by precedential law. Yet a sensitive
judicial conscience often persuades the mind to search for a different
set of norms more responsive to the changed social context. The
dilemma before the Judge poses the task of finding a new equilibrium,
prompted not seldom by the desire to reconcile opposing mobilities.
B The competing goals, according to Dean Roscoe Pound, invest the
Judge with the responsibility "of proving to mankind that the law was
something fixed and settled, whose authority was beyond question,
while at the same time enabling it to make constant readjustments and
occasional radical changes under the pressure of infinite and variable
human desires." Roscoe Pound, "an Introduction to the Philosophy of
Law" p. 19. The reconciliation suggested by Lord Reid in "The
c Judges as Law Maker" pp. 25-6 lies in keeping both objectives in
view, "that the law shall be certain, and that it shall be just move with
the times." An elaboration of his opinion is contained in Myers v.
Director of Public Prosecutions, L.R. 1965 A.C. 1001, where he
expressed the need for change in the law by the court and the limits
D within which such change could be brought about. He said: ibid at
p. 1021.

"I have never taken a narrow view of the functions of this
House as an appellate tribunal. The common law must be
developed to meet changing economic conditions and
E habits of thought, and I would not be deterred by expres-
sions of opinion in this House in old cases. But there are
limits to what we can or should do. If we are to extend the
law it must be by the development and application of
fundamental principles. We cannot introduce arbitrary
conditions or limitations: that must be left to legislation.
F And if we do in effect change the law, we ought in my
opinion only to do that in cases where our decision will
produce some finality or certainty."

Whatever the degree of success in resolving the dilemma, the Court
woud do well to ensure that although the new legal norm chosen in
G response to the changed social climate represents a departure from the
previously ruling norm, it must, nevertheless. carry within it the same
principle of certainty, clarity and stability.

The profound responsibility which is borne by this Court in its
choice between earlier established standards and the formulation of a
H new code of norms is all the more sensitive and significant because the
U.0.1. v. RAGHUBIR SINGH !PATHAK, CJ.I 327

response lies in relation to a rapidly changing social and economic
A
society. In a developing society such as India the law does not assume
its true function when it follows a groove chased amidst a context
which has Jong since crumbled. There will be found among some of the
areas of the law norms selected by a judicial choice educated in the
experience and values of a world which passed away 40 years ago. The
social forces which demand attention in the cauldron of change from B
which a new society is emerging appear to call for new perceptions and
new perspectives. The recognition that the times are changing and that
there is occasion for a new jurisprudence to take birth is evidenced by
what this Court said in The Bengal Immunity Company Limited v. The
State of Bihar and Others, [1955] 2 SCR 603, when it observed that it
was not bound by its earlier judgments and possessed the freedom to
overrule its judgments when it thought fit to do so to keep pace with c
the needs of changing times. The acceptance of this principle ensured
the preservation and legitimation provided to the doctrine of binding
precedent, and therefore, certainty and finality in the law, while
permitting necessary scope for judicial creativity and adaptability of
the law to the changing demands of society. D

The question then is not whether the Supreme Court is bound by
its own previous decisions. It is not. The question is under what
circumstances and within what limits and in what manner should the
j highest Court over-turn its own pronouncements.
E
In the examination of this question it would perhaps be appro-
priate to refer to the response of other jurisdictions, specially those
with which the judicial system in India has borne an historical relation-
ship. The House of Lords in England provides the extreme example of
a judicial body which until recently disclaimed the power to overrule
itself. It used to be said that the House of Lords did never overrule

*
F
'. itself but only distinguished its earlier decisions. An erroneous deci-
sion of the House of Lords could be set .right only by an Act of Parlia-
ment. (See Street Tramways v. London County Council, [1898] A.C.
375 and Radcliffe v. Ribble Motor Services Ltd., [1939] A.C. 215, 245.)
Apparently bowing to the pressure of a reality forced upon it by reason
of a rapidly gathering change in the prevailing socio-ec.onomic struc- G
ture, on 26 July, 1966, Lord Gardiner, L.C., made the following state-
ment on behalf of himself and the Lords of Appeal in Ordinary:

"Their lordship regard the use of precedent as an indis-
pensable foundation upon which to decide what is the law
and its application to individual cases. It provides at least H
328 SUPREME COURT REPORTS [1989] 3 S.C.R.

some degree of certainty upon which individuals can rely in
A
the conduct of their affairs, as well as a basis for orderly
development of legal rules.

Their lordships nevertheless recognise that too rigid
adherence to precedent may lead to injustice in a particular
B case and also unduly restrict the proper development of the
law. They propose therefore fo modify their present prac-
tice and, while treating former decisions of this House as
normally binding, to depart from a previous decision when
it appears right to do so.

In this connection they will bear in mind the danger
c of disturbing retrospectively the basis on which contracts,
settlements of property and fiscal arrangements have been
entered into and also the especial need for certainty as to
the criminal Law."

D Since then the House of Lords has framed guidelines in a series of
cases decided upto to 1975 and the guidelines have been summarised in
Dr. Alan Paterson's "Law Lords" 1982: pp. 156-157. He refers to
several criteria articulated by Lord Reid in those cases.

1. The freedom granted by the 1966 Practice Statement ought to
E be exercised sparingly (the 'use sparingly' criterion) (Jones v. Secretary
l ·
of State for Social Services, I1972] A.C. at 966.

2. A decision ought not to be overruled if to do so would upset "'
the legitimate expectations of people who have entered into contracts
or settlements or otherwise regulated their affairs in reliance on the
F validity of that decision (the 'legitimate expectations' criterion) (Ross- -j..
Smith v. Ross-Smith, [196:3] A.C. 280, 303 and Indyka v. Indyka, "
I 1969] I A.C. 33, 69.)
3. A decision concerning questions of construction of statute or
other documents ought not to be overruled except in rare and excep-
G tional cases (the 'Construction' criterion) Jones, at 966.

4( a) A decision ought not to be overruled if it would be im- ).--
practicable for the Lords to foresee the consequences of departing /
from it (the 'unforseeable consequences' criterion) (Steadman v.
Steadman, [1976] A.C. 536, 542. (b) A decision ought not to be over-
H ruled if to do so would involve a change that ought to be part of a
U.0.1. v. RAGHUBIR.SINGH [PATHAK, CJ.I 329

comprehensive reform of the law. Such changes are best done 'by
A
legisi'ation following on a wide survey of the whole field' (the 'need for
comprehensive reform' criterion) (DPP v. Myers, [1965] A.C. 1001,
1022; Cassell v. Broome, [1972] A.C. 1027, 11086 and Haughton v.
Smith, [1975] A.C. 476, 500).

5. In the interest of certainty, a decision ought not to be over- B
ruled merely because the Law Lords consider that it was wrongly
decided. There must be some additional reasons to justify such a step
(the 'precedent merely wrong' criterion) (Knullerv. DPP, [1973] A.C.
435, 455;

6. A decision ought to be overruled if it causes such great uncer-
tainty in practice that the Parties' advisers are unable to give any clear
c
indication as to what the courts will hold the law to be (the 'rectifica-
tion of uncertainty' criterion) Jon-es, at 966; O/dendroff & Co. v.
Tradex Export, S.A. 1974 479, 533, 535.

7. A decision ought to be overruled if in relation to some broad D
issue or principle it is not considered just or in keeping with con-
temporary social conditions or modern conceptions of public P<?licy
(the 'unjust or outmoded' criterion) ibid Conway v. Rimmer, [1968]
A.C. 910, 938.

Dr. Paterson noted that between the years 1966 and 1988 there E
were twenty nine cases in which the House of Lords was invited to
overrule one of its own precedents, that the House of Lords did so in
eight of them, while in a further ten cases at least one of the Law Lords
was willing to overrule the previous House of Lords precedent. In a
considerable number of other cases, however, the Law Lords seemed
to prefer to distinguish the earlier decisions rather than overrule them. F

The High Court of Australia, the highest Court in the Common-
wealth, has reserved to itself the power to reconsider its own decision,
but has laid down that the power should not be exercised upon a mere
suggestion that some or all the member of the later Court would arrive
at a different conclusion if the matter were res integra. In the Tram- G
.__,. ways case, [1914] 18 C.L.R. 54, Griffith, C.J., while doing so
administered the following caution:

"In my opinion, it is impossible to maintain as an abstract
proposition that Court is either legally or technically bound
by previous decisions. Indeed, it may, in a proper case, be H
330 SUPREME COURT REPORTS [1989]'3 S.C.R.

A its duty to disregard them. But the rule should be applied
with great caution, and only when the previous decision is
manifestly wrong, as, for instance, if it proceeded upon the
mistaken assumption of the continuance of a repealed or
expired Statute, or is contrary to a decision of another
B Court which this Court is bound to follow; not, I think,
upon a mere suggestion, that some or all of the members of
the later Court might arrive at a different conclusion if the
matter was res integra. Otherwise there would be grate
danger of want of continuity in the interpretation of law."

In the same case, Barton, J. observed at p. 69:
c
" ..... I would say that I never thought that it was not open
to this Court to review its previous decisions upon good
cause. The question is not whether the Court can do so, but
whether it will, having due regard to the need for conti-
nuity and consistency in the judicial decision. Changes in
D
the number of appointed Justices can, I take it, never of
themselves furnish a reason for review ..... But the Court
can always listen to argument as to whether it ought to
review a particular decision, and the strongest reason for
an overruling is that a decision is manifestly wrong and its
continuance is injurious to the public interest".
E
In the United States· of America the Supreme Court has
explicitly overruled its prior decision in a number of cases and refer-
ence will be found to them in the judgment of Brandeis, J. in State of
Washington v. Dawson & Co., 264 U.S. 646; 68 L.Ed. 219 where he
said:
F
"The doctrine of Stare decisis should not deter us from
overruling that case and those which follow it. The deci-
sions are recent ones. They have not been acquiesced in.
They have not created a rule of property around which
vested interests have clustered. They affect solely matters
G
of a transitory nature. On the other hand, they affect
seriously the lives of men, women and children, and the
general welfare. Stare decisis is ordinarily, a wise rule of
action. But it is not a universal, inexorable command. The
instances in which the Courts have disregarded its admoni-
H tion are many."
U.Q.J..v. RAGHUBIR SINGH [PA1HAK, CJ.) 331

'
Elaborating his point in his dissenting judgment in David Burne/ v. A
Coronado Oil & Gas Company, 285 U.S. 393; 76 L.Ed. 815, Brandeis,
J. observed:

"Stare decisis usually the wise policy, because in most mat-
ters it is more important that the applicable rule of law be
-1 settled right. Compare National Bank v. Whitney, 103 U.S.
99; 26 L.Ed. 443-444. This is commonly true even where
B

the error is a matter of serious concern, provided correc-
tion can be had by legislation. But in cases involving the

-·· ·~
Federal Constitution, where correction through legislative
action is practically impossible, this Court has often over-
ruled its earlier decisions. The Court bows to the lessons of
experience and the force of better reasoning recognising
that the process of trial and error, so fruitful in the physical
c

sciences, is appropriate also in the judicial function."

The Judicial Committee of the Privy Council also took the view
that it was not bound in law by its earlier decisions, but in In re D
Compensation to Civil Servants, L.R. 1929 A.C. 242; A.LR. 1929 P .C.
84, 87 it declared that it "would hesitate long before disturbing a
solemn decision by a previous Board, which raised an identical or even
) a similar issue for determination" and reiterated that reservation in the
Attorney-Genera/ of Ontario v. The Canada Temperance Federation, L.R.
76 Q.A. 10 and Phanindra ChandraNeogy v. The King, [1953] SCR 1069. E

.. These cases from England, Australia and the United States were
considered by this Court in The Bengal Immunity Company Limited v.
The State of Bihar and others, (supra), perhaps the first recorded
' instance of the Supreme .Court in this country being called upon to

""- consider whether it could overrule an earlier decision rendered by it.
A Bench of seven Judges assembled to consider whether the majority
decision of a Constitution Bench of five Judges in State of Bombay v.
F

The United Motors (India) .Ltd., [1953] S.C.R. 1069 should be recon-
sidered. Four Judges of the Bench of seven said it should and voted to
overrule the majority decision in the United Motors, (supra). The
remaining three voted to the contrary. Das, Acting C.J., speaking for G
himself and on behalf of Bose, Bhagwati and Jafar Imam, JJ, preferred
~ the approach adopted by the United States Supreme Court since, in
the view of that learned Judge, the position in India approximated
more closely to that obtaining in the United states rather than to the
position in England, where Parliament could rectify the situation by a
simple majority, and to that in Australia, where the mistake could be H
332 SUPREME COURT REPORTS (1989] 3 S.C.R.

A
corrected in appeal to the Privy Council. The learned Judge observed:
"There is nothing in our Constitution which prevents us from depart-
ing from a previous decision if we are convinced of its error and its
r
baneful effect on the general interests of the public." And reference
was made to the circumstance that Article 141 of the Constitution
made the law declared by this Court binding on all Courts in India.
B Speaking wi.th reference to the specific case before the Court, the )--
learned Judge referred to the far-reaching effect of the earlier decision

,.-
in the United Motors (supra) on the general body of the consuming
public, and that the error committed in the earlier decision would
result in perpetuating a tax burden erroneously imposed on the ti
people, giving rise to a consequence "manifestly and wholly unautho-
rised."
c
The learned Judge observed:
~

"It is not an ordinary pronouncement declaring the rights of two
private individuals inter se. It involves an adjudication on the taxing
D power of the States as against the consuming public generally. If the
decision is erroneous, as indeed we conceive it to be, we owe it to the
public to protect them against the illegal tax burdens which the States
are seeking to impose on the strength of that erroneous recent-
decision". Cautioned that the Court should not differ merely because
a contrary view appeared preferable, the learned Judge affirmed that 1.~
E "we should not lightly dissent from a previous pronouncement of this
Court." But if the previous decision was plainly erroneous, he pointed
out, there was a duty on the Court to say so and not perpetuate the
mistake. The appeal to the principle of stare decisis was rejected on
..
the ground that (a) the decision intended to be overruled was a very
recent decision and it did not involve overruling a series of decisions,
F and (b) the doctrine of stare decisis was not an inflexible rule, and
must, in any event, yield where following it would result in perpetual-
ing an error to the detriment of the general welfare of the public or a
----
considerable section thereof.

Since then the question as to when should the Supreme Court
G overrule its own decision has been considered in several cases. Relying
on the Bengal Immunity case, Khanna, J. remarked that certainly in
the law, which was an essential ingredient of the Rule of Law, would ~
be considerably eroded if the highest court of the land lightly over-
ruled the view expressed by it in earlier cases. One instance when:
such overruling could be permissible was a situation where contextual
H values giving birth to the earlier view had altered substantially since.
U.0.1. v. RAGHUBIR SINGH !PATHAK, CJ.] 333.

In Magan/al Chhagganlal (P) Ltd. v. Municipal Corporation of Greater
A
Bombay & Ors., [1975] I SCR lheexplained:

"Some new aspects may come to light and it may become
essential to cover fresh grounds to meet the new situations
or to overcome difficulties which did not manifest thenF
selves or were not taken into account when the earlier view B
was propounded. Precedents have a value and the ratio
decidendi of a case can no doubt be of assistance in the
decision of future cases. At the same time we have to, as
observed by Cardozo, guard against the notion that
because a principle has been formulated as the ratio
deCidendi of a given problem, it is therefore to be applied
as a solvent of other problems, regardless of consequences,
c
regardless of deflecting factors, inflexibly and automati-
cally, in all its pristine generality (see Selected Writings, p.
31). As in life so in law things are not static."

In Lt. Col. Khajoor Singh v. The Union of India & Anothl<[, D
[1961] 2 SCR 828 the majority of this court emphasised that the court.
should not depart from an interpretation given in an earlier judgment
of the court unless there was a fair amount of unanimity that the earlier
decision was manifestly wrong. In Keshav Mills Company v. Commis-
sioner of Income Tax, [1965] 2 SCR 908, 921 this court observed that a
revision of its earlier decision would be justified if there were compel- E
ling and substantial reasons to do so. In Sajjan Singh v. State of
Rajasthan, 119651 I SCR 933, 947-948 the court laid down the test: 'Is
it absolutely necessary and essential that the question already decided
sho.uld be reopened?', and went on to observe: 'the answer to this
q ut!stion would depend on the nature of the infirmity alleged in the
earlier decision, its impact on public good and the validity and compel- F
ling character of the considerations urged in support of the contrary
view.' There can be no doubt, as was observed in Girdhari Lal Gupta
v. D.H. Mill, [1971] 3 SCR 748 that where an earlier relevant statutory
provision has not been brought to the notice of the court, the decision
may be reviewed, or as in Pillani Investment Corporation Ltd. v.
I. T.O. 'A' Ward, Calcutta & Anr., [1972] 2 SCR 502, if a vital point G
was not considered. A more compendious examination of the problem
was undertaken in Keshav Mills Company v. Commissioner of Income
Tax, (supra) where the Court pointed out:

"It is not possible or desirable, and in any case it would be
inexpedient to lay down any principles which should H
334 SUPREME COURT REPORTS [1989] 3 S.C.R.

govern the approach of the Court in dealing with the q ues-.
A
tion of reviewing and revising its earlier decisions. It would y
always depend upon several relevant considerations:-What
is the nature of the infirmity or error on which a plea for a
review and revision of the earlier view is based? On the
earlier occasion, did some patent aspects of the question
remain unnoticed, or was the attention of the Court not
drawn to any relevant and material statutory provision, or
was any previous decision of this Court bearing on the
point not noticed? Is the court hearing such plea fairly
unanimous that there is such an error in the earlier view?
What would be the impact of the error on the general
administration of law or on public good? Has the earlier
c decision been followed on subsequent occasions either by
this. Court or by the High Courts? And, would the reversal
of the earlier decision lead to public inconvenience, hard-
ship or mischief? These and other relevant considerations
must be carefully borne in mind whenever this Court is
D called upon to exercise its jurisdiction to review and revise
its earlier decisions. These considerations become still
more significant when the earlier decision happens to be a
unanimous decision of the Bench of five learned Judges of
this Court."

Ill Much importance has been laid on observing the finality of deci-
sions rendered by the Constitution Bench of this Court, and in Ganga
Sugar Company v. State of Uttar Pradesh, [1980] 1 SCR 769, 782 the
Court held against the finality only where the subject was 'of such
fundamental importance to national life or the reasoning is so plainly
erroneous in the light of later thought that it is wiser to be ultimately
F right rather than to be consistently wrong'.

It is not :lecessary to refer to all the cases on the point. The broad
guidelines are easily deducible from what has gone before. The possi-
bility of further defining these guiding principles can be envisaged with
further juridical experience, and when common jurisprudential values
G linking different national systems of law may make a consensual pat-
tern possible. But that lies in the future.

There was some debate on the question whether a Division
Bench of Judges is obliged to follow the law laid down by a Division
Bench of a larger number of Judges. Doubt has arisen on the point
H because of certain observations made by 0. Chinn app a Reddy, J. in
U.0.1. v. RAGHUBIR SINGH !PATHAK, CJ.] 3J5

Javed Ahmed Abdul Hamid Pawala v. State of Maharashtra, AIR 1985
A
SC 231. Earlier, a Division Bench of two Judges, of whom he was one,
had expressed the view in T. V. Vatheeswaran v. The State of Tamil
Nadu, AIR 1983 SC 361 that delay exceeding two years in the execu-
tion of a sentence of death should be considered sufficient to entitle a
person under sentence of death to invoke Article 21 of the Constitu-
tion and demand the quashing of the sentence of death. This would be B
so, he ooserved, even if the delay in the execution was occasioned by
the time necessary for filing an appeal or for considering the reprieve
of the accused or some other cause for which the accused himself may
be responsible. This view was found unacceptable by a Bench of three
Judges in Sher Singh & Ors. v. State of Punjab, AIR 1983 SC 465
where the learned Judges observed that no hard and fast rule could be
laid down in the matter. In direct disagreement with the view in T. V.
c
Vatheeswaran, (supra), the learned Judges said that account had to be
taken of the time occupied by proceedings in the High Court and in the
Supreme Court and before the executive authorities, and it was rele-
vant to consider whether the delay was attributable to the conduct of
the accused. As a member of another Bench of two Judges, in.Javed D
Ahmed Abdu(.Hamid Pawala, (supra) 0. Chinnappa Reddy, J.
questioned the validity of the observations made in Sher Singh, (supra)
and went on to note, without expressing any concluded opinion on the
point, that it was a serious question "whether a Division Bench of
three Judges could purport to overrule the judgment of a Division
Bench of two Judges merely because there is larger than two. The E
Court sits in Divisions of two and three Judges for the sake of conveni-
ence and it may be inappropriate for a Division Bench of three Judges
to purport to overrule the decision of a Division Bench of two Judges.
Vide Young v. Bristol Aeroplane Co. Ltd., [1944] 2 All ER 293. It may
be otherwise where a Full Bench or a Constitution Bench does so." It
is Peortinent to record here that because of the doubt cast on- the vali- F
dity of the opinion in Sher Singh, (supr:\), the question of the effect of
delay on the execution of a death. sentence was referred to a Division
Bench of five Judges, and in Triveniben v. State of Gujarat, AIR 1989
SC 142 the Constitution Bench overruled T. V. Vatheeswaran, (supra).

What then should be the position in regard to the effect of the G
law pronounced by a Division Bench in relation to a case raising the
same point subsequently before a Division Bench of a smaller number
of Judges? There is no constitutional or statutory prescription in the
matter, and the point is governed entirely by the practice in India of
the Courts sanctified by repeated affirmation over a century of time. It
cannot be doubted that in order to promote consistency and certainty H
336 SUPREME COURT REPORTS [1989] 3 S.C.R.

A
in the law laid down by a superior Court, the ideal condition would be
that the entire Court should sit in all cases to decide questions of law,
·y
and for that reason the Supreme Court of the United States does so.
But having regard to the volume of work demanding the attention of
the Court, it has been found necessary in India as a general rule of
practice and convenience that the Court should sit in Divisions, each
B Division being constituted of Judges whose number may be deter-
mined by the exigencies of judicial need, by the nature of the case ).-
including any statutory mandate relative thereto, and by such other
considerations which the Chief Justice, in whom such authority
devolves by convention, may find most appropriate. It is in order to
guard against the possibility of inconsistent decisions on points of law y-
by different Division Benches that the rule has been evolved, in order
c to promote consistency and certainty in the development of the law
and its contemporary status, that the statement of the law by a Divi-
sion Bench is considered binding on a Division Bench of the same or
-+
lesser number of Judges. This principle has been followed in India by
several generations of Judges. We may refer to a few of the recent
D cases on the point. In John Martin v. The State of West Bengal, [1975] 3
SCR 211 a Division Bench of three Judges found it right to follow the
law declared in Haradhan Saha v. State of West Bengal, [1975] 1 SCR
778 decided by a Division Bench of five Judges, in preference to Bhut
Nath Mate v. State of West Bengal, AIR 1974 SC 806 decided by a

~'
Division Bench of two Judges. Again in Smt. India Nehru Gandhi v.
E Shri Raj Narain, [1976] 2 SCR 347 Beg, J. held that the Constitution
Bench of five Judges was bound by the Constitution Bench of thirteen
Judges in His Holiness Kesavananda Bharati Sripadagalavaru v. State
of Kera/a, [1973] Suppl. 1 SCR. In Ganapati Sitaram Balvalkar & Anr.
v. Waman Shripad Mage (Since Dead) Through Lrs., [1981] 4 SCC 143
this Court expressly stated that the view taken on a point of law by a
F Division Bench of four Judges of this Court was binding on a Division
Bench of three Judges of the Court. And in Mattu/al v. Radhe Lal,
-it'
[ 1975] 1SCR127 this Court specifically observed that where the view
expressed by two different Division Benches of this Court could not be
reconciled, the pronouncement of a Division Bench of a larger number
of Judges had to be preferred over the decision of a Division Bench of
G a smaller number of Judges. This Court also laid down in Acharaya
Maharajshri Narandraprasadji Ar1andprasadjiMaharaj etc. etc. v. The
State of Gujarat & Ors., I1975] 2 SCR 317 that even where the strength )...
of two differing Division Benches consisted of the same number of
Judges, it was not open to one Division Bench to decide the correct-
ness or other-wise of the views of the other. The principle was reaf-
H firmed in Union of India & Ors. v. Godfrey Philips India Ltd., [1985] 4
U.0.1. v. RAGHUBIR SINGH [PATHAK, CJ.] 337

SCC 369 which noted that a Division Bench of two Judges of this Court
A
in lit Ram v. State of Haryana, [1980] 3 SCR 689 had differed from the
view taken by an earlier Division Bench of two Judges in Motilal
Padampat Sugar Mills v. State of U.P., [1979] 2 SCR 641 on the point
whether the doctrine of promissory estoppel could be defeated by
invoking the defence of executive necessity, and holding that to do so
was wholly unacceptable reference was made to the well accepted and 8
desirable practice of the later Bench refe;ring the case to a larger
Bench when the learned Judges found that the situation called for such
reference.

We ·are of opinion that a pronouncement of law by a Division
Bench of this Court is binding on a Division Bench of the same· or a
smaller number of Judges, and in order that such decision be binding,
c
it is not necessary that it should be a decision rendered by the Full
Court or a Constitution Bench of the Court. We would, however, like
to think that for the purpose of imparting certainty and endowing due
authority decisions of this Court in the future should be rendered by
Division Benches of at least three Judges unless, for compelling D
reasons that is not conveniently possible.

Upon the aforesaid considerations, and in view o.f the nature and
_,J potential of the questions raised in these cases we are of the view that
there was sufficient justification for the order dated 23 September,
1985 made by the Bench of two learned· Judges referring these cases to E
a larger Bench for reconsideration of the question decided in K.
. Kamalajammannivaru (dead) by Lrs., (supra) and Bhag Singh 'and
Ors., (supra). The preliminary Objection raised by learned counsel for
the respondents to the validitv of the reference is overrrnled. - -

We now come to the merits of the reference. The reference is F
limited to the interpretation of s. 30(2) of the Land Acquisition
(Amendment) Act of 1984. Before the enactment of the Amendment
A,ct, solatium was provided under s. 23(2) of the Land Acquisition Act
(shortly, "the parent Act") at 15% on the market value of the Land
computed in accordance with s. 23(1) of the Act,_ the solatium being
provided in consideration of the compulsory nature of the acquisition. G
The Land Acquisition Amendment Bill, 1982 was introduced in the
House of the People on 30 April, 1982 and upon enactment the Land
Acquisition Amendment Act 1984 commenced operation with effect
from 24 September, 1984. S. 15 of the Amendment ·Act amended
s. 23(2) of the parent Act and substituted the words '30 per centum' in
place of the words '15 per centum'. Parliament intended that the be- H
338 SUPREME COURT REPORTS [1989] 3 S.C.R.

A
nefit of the enhanced solatium should be made available albeit to a
limited degree, even in respect of acquisition proceedings taken before
'r
that date. It sought to effectuate that intention by enacting s. 30(2) in
the Amendment Act, S. 30(2) of the Amendment Act provides:

"(2) the provisions of sub-s. (2) of s. 23 ...... of the
principal Act, as amended by clause (b) of s. 15 ........ of }-
this Act ....... shall apply and shall be deemed to have
applied, also to, and in relation to, any award made by the
Collector or Court or to any order passed by the High

'
Court or Supreme Court in appeal against any such award
under the provisions of the principal Act after the 30th day
of April, 1982 [the date of introduction of the Land Acquis-
ition (Amendment) Bill, 1982, in the House of the People] -{·
and before the commencement of this Act." s;

In construing s. 30(2), it is just as well to be clear that the award made
by the Collector referred to here is the award made by the Collector
D under s. 11 of the parent Act, and the award made by the Court is the
award made by the Principal Civil Court of Original Jurisdiction under
s. 23 of the parent Act on a reference made to it by the Collector under
s. 19 of the parent Act. There can be no doubt that the benefit of the
enhanced solatium is intended bys. 30(2) in respect of an award made
by the Collector between 30 April 1982 and 24 September, 1984.
i.
Ji: Likewise the benefit of the enhanced solatium is extended bys. 30(2)
to the case of an award made by the Court between 30 April 1982 and
24 September 1984, even though it be upon reference from an award
made before 30 April, 1982.

The question is: what is 'the meaning of the words "or to any -j,,.
JI; order passed by the High Court or Supreme Court on appeal against
any such award?" Are they limited, as contended by the appellants, to
appeals against an award of the Collector or the Court made between
30 April 1982 and 24 September 1984, or do they include also, as
contended by the respondents, appeals disposed of between 30 April,
1982 and 24 September 1984 even though arising out of awards of the
G Collector or the Court made before 30 April, 1982. We are of opinion
that the interpretation placed by the apJ?ellants should be preferred
over that suggested by the respondents. Parliament has identified the '>-
appeal before· the High Court and the appeal before the Supreme
Court by describing it as an appeal against 'any such award'. The
submission on behalf of the respondents is that the words 'any such
f:I award' mean the award made by the Collector or Court, and carry no
r

U.0.1. v. RAGHUBIR SINGH [PATHAK, CJ.I 339

greater limiting sense; and that in this context, upon t_he language of
A
s. 30(2), the on:lt'r in appeal is an appellate order made between 30
April 1982 and 24'5eptember 1984-in which case the related award of
the Collector or of the Court may have been made before 30 April
1982. To our mind, the words 'any such award' cannot bear the broad
meaning suggested by learned counsel for the respondents. No such
'
words of description by way of identifying the appellate order of the B
-1 High Court or of the.Supreme Court were neces·sary. Plainly, having
regard to the existing hierarchical structure of for a contemplated in ·the
parent Act those appellate orders could only be orders arising in
-7 appeal against the award of the Collector or of the Court. The words
'any such award' are intended to have deeper significance, and in the
context in which those words appear ins. 30(2) it is clear that they are
intended to refer to awards made by the Collector or Court between 30
c
April, 1982 and 24 September, 1984. In other words s. 30(2) of the
Amendment Act extends the benefii of the enhanced solatium to cases
where the award by the Collector or by the Court is made between 30
April, 1982 and 24 September, 1984 or to appeals against such awards
decided by the High Court and the Supreme Court whether the deci- D
sions of the High Court or the Supreme Court are rendered before 24
September, 1984 or after that date. All that is material is th_at the
award by the Collector or by the Court should have been made bet-
ween 30 April, 1982 and 24 September, 1984. We find ourselves in
agreement with the conclusion reached by this Court in K. Kamala-
jammanniavaru (dead) by Lrs. v. Special Land Acquisition Officer, E
(supra), and find ourselves unable to agree with the view taken in
Bhag Singh and Others v. Union Territory of Chandigarh, (supra). The
expanded meaning given to s. 30(2) in the latter case does not, in our
opinion, flow reasonably from the language of that sub-section. It
seems to us that the learned judges in that case missed the significance
---- of the word 'such' in the collocation 'any such award' ins. 30(2). Due
significance must be attached to that word, and to our mind it must
F

necessarily intend that the appeal to the High Court or the Supreme
Court, in which the benefit of the enhanced solatium is to be given,
must be confined to an appeal against an award of the Collector or of
the Court rendered between 30 April, 1982 and 24 September, 1984.
G
We find substance in the contention of the learned Attorney
General that if Parliament had intended that the benefit of enhanced
solatium should be extended to all pending proceedings it would have
said so in clear language. On the contrary, as he says, the terms· in
which s. 30(2) is couched indicate a limited extension of the benefit.
The Amendment Act has not been made generally retrospective with H

n:
340 SUPREME COURT REPORTS [1989] 3 S.C.R.

A
effect from any particular date, and such retrospectivity as appears is y
I
restricted to certain areas covered by the parent Act and must be
discovered from the specific terms of the provision concerned. Since it
is necessary to spell out the degree of retrospectivity from the language
of the relevant provision itself, close attention must be paid to the
provisions of s. 30(2) for determining the scope of retrospective relief
B intended by Parliament in the matter of enhanced solatium. The
learned Attorney General is also right when he points out that it was
,..,
never intended to define the scope of the enhanced solatium on the
mere accident of the disposal of a case in appeal on a certain date.
Delays in the superior Courts extend now to limits which were never
anticipated when the right to approach them for relief was granted by y-
If it was intended that s. 30(2) should refer to appeals pending
c statute.
before the High Court or the Supreme Court between 30 April, 1982
and 24 September, 1984, they could well refer to proceedings in which -1-
an award had been made by the Collector from anything between 10 to
20 years before. It could never·have been intended that rates of com-
pensation and solatium applicable to acquisition proceedings initiated
D so long ago should now en joy the benefit of statutory enhancement. It
must be remembered that the value of the land is taken under s. 11(1)
ands. 23(1) with reference to the date of publication of the notification
under-s.4( 1), and it is that date which is usually material for the
purpose of determining the quantum of compensation and solatium.
Both s. 11(1) ands. 23(1) speak of compensation being determined on
E the basis, inter alia, of the market value of the land on that date, and
\.
solatium by s. 23(2), is computed as a percentage on such market
value. ..
Our attention was drawn to the order made in State of Punjab v.
Mohinder Singh, (supra), but in the absence of a statement of the
F reasons which persuaded the learned Judges to take the view they did
we find it difficult to endorse that decision. It received the approval of
ir"
the learned Judges who decided Bhag Singh (supra), but the judgment
in Bhag Singh, (supra) as we have said earlier, has omitted to give due
significance to all-the material provisions of s. 30(2), and consequently
we find ourselves at variance with it. The learned Judges proceeded to
G apply the principle that an appeal is a continuation of the proceeding
initiated before the Court by way of reference under-s.18 but, in our
opinion, the application of a general principle must yield to the limit- ~
ing terms of the statutory provision itself. Learned. counsel for the
respondents has strenuously relied on the general principle that the
appeal is a re-hearing of the original matter, but we are not satisfied
14 that he is on good ground in invoking that principle. Learned counsel
U.0.1. v. RAGHUBIR SINGH [PATHAK, Cl.] 341

for the respondents points out tha1 the word 'or' has been used in
A
s. 30(2), as a disjunctive between the reference to the award made by
the Collector or the Court and an order passed by the High Court or
the Supreme Court in appeal and, he says, properly understood it must
mean that the period 30 April, 1982 to 24 September, 1984 is as much
applicable to the appellate order of the High Court or of the Supreme
Court as it is to the award made by the Collector or the Court. We B
think that what Parliament intends to say is that the benefit of s. 30(2)
will be available tci an award by' the Collector or the Court made
between the aforesaid two dates or to an appellate order of the High
Court or of the Supreme Court which arises out of an award of the
Collector or the Court made between the said two dates. The word 'or'
is used with reference to the stage at which the proceeding rests at the
time when the benefit under-s. 30(2) is sought to be extended. If the c
proceeding has terminated with the award of the Collector or of the
Court made between the aforesaid two dates, the benefit of s. 30(2)
will be applied to such award made between the aforesaid two dates. If
the proceeding has passed to the stage of appeal before the High Court
or the Supreme Court, it is at that stage when the benefit of s. 30(2) D
will be applied. But in every case, the award of the Collector or of the
Court must have been made between 30 Aprfl, 1982 and 24 Septem-
ber, 1984.

In the result we overrule the statement of the law laid down in
Mohinder Singh, (supra) and in Bhag Singh and Another, (supra) and E
prefer instead the interpretation of s. 30(2) of the Amendment Act
rendered in K. Kamalajammanniavaru (dead) by Lrs. (supra).

The cases will now be listed before a Division Bench of three
learned Judges for hearing on the merits of the other points raised in
the cases. F

Y.Lal