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PETITIONER: DIRECTOR OF RATIONING AND DISTRIBUTION

       Vs.

RESPONDENT: THE CORPORATION OF CALCUTTA AND OTHERS

DATE OF JUDGMENT: 16/08/1960

BENCH: SINHA, BHUVNESHWAR P.(CJ) BENCH: SINHA, BHUVNESHWAR P.(CJ) IMAM, SYED JAFFER SARKAR, A.K. WANCHOO, K.N. SHAH, J.C.

CITATION:  1960 AIR 1355            1961 SCR  (1) 158  CITATOR INFO :  RF         1961 SC 112  (80)  RF         1961 SC 221  (25,33)  R          1963 SC1241  (68,65)  D          1963 SC1681  (15)  R          1964 SC 669  (12,13,14)  R          1964 SC1781  (9)  R          1965 SC1061  (17)  O          1967 SC 997  (1,2,6,22,24,27,34,44,51,54,56  E          1968 SC 360  (2,4)  RF         1976 SC1207  (162,182)  RF         1988 SC1003  (2)

ACT: Statute,    interpretation    of--State,   if    bound    by statute--Principles   applicable--"  Person",  if   includes State--Calcutta Municipal Act, 1923 (Ben.  III of 1923),  S. 386(1)(a)--Constitution of India, Art. 372.

HEADNOTE: The  appellant  was using certain premises in  Calcutta  for storing  rice  flour, etc. without taking  out  any  license under s. 386(1)(a) of the Calcutta Municipal Act, 1923.  The respondent  filed  a complaint against the appellant  for  a contravention   of  S.  386(1)(a).   The  trial   Magistrate acquitted  the appellant holding that the provisions  of  s. 386(1)(a),  neither  in terms nor by  necessary  implication bound  the  Government whom the appellant  represented.   In revision, the High Court held that the Government was  bound by a statute unless the legislature excluded it expressly or by necessary implication.  The High Court declined to follow the decision of the Privy Council in L. R. 73 1. A. 271 that the  general  principle  applicable in  England  applied  to Indian legislation also. Held,  that the State was not bound by the provisions of  s. 386(1)(a) of the Calcutta Municipal Act, 1923, and that  the appellant   was   not  liable  to  be   prosecuted   for   a contravention of this section. Per Sinha, C. J., Imam and Shah, jj.--The law applicable  to India  before the Constitution was as  authoritatively  laid

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down  by  the  Privy Council in L. R. 73  I.  A.  271.   The Constitution has not made any change in the legal  position. On the other hand it has clearly indicated that the laws  in force  before  January  26, 1950,  shall  continue  to  have validity  even  in the new set-up except in so far  as  they were  in  conflict  with  the  express  provisions  of   the Constitution.   The rule of interpretation of statutes  that the State is not bound by a statute unless it is so provided in express terms or by necessary implication, is still  good law. Province  of Bombay v. Municipal Corporation of the City  of Bombay, (1946) L.R. 73 I. A. 271, applied. Bell v. The Municipal Commissioners for the City of  Madras, (1901) I.L.R. 25 Mad. 457, disapproved. The  Corporation of Calcutta v.  Sub-Postmaster,  Dharmatala Post  Office,  (1948)  54 C. W. N.  429,  United  States  of America v. 159 United Mine Workers of America, (1947) 91 L. Ed. 884, United States  of America v. Reginald P. Wittek, (1949) 93  L.  Ed. 1406,   Less  Larson  v.  Domestic  and   Foreign   Commerce Corporation,  (1949)  93 L. Ed. 1628 and Roberts  v.  Abern, (1904) I C. L. R. 406, referred to. There  is nothing in the Act to indicate that the State  was bound by it by necessary implication, nor is there  anything in  it to show that if s. 386 were not held to apply to  the State  the  law would lose it efficacy or that  its  working would be hampered in any way. Per  Sarkar, J.-The rule that the crown is not bound by  the provisions  of  any  statute unless it  is  directly  or  by necessary  implication  referred  to is  really  a  rule  of construction  of  statutes  and is not  dependent  on  royal prerogatives.   It has been applied by courts in  India  all along before the Constitution and there is no reason why  it should  not  be applied to the  interpretation  of  statutes after the Constitution. Attorney  General  v.  Donaldson, (1842) 10  M.  &  W.  117, Coomber V’     justices  of Berks, (1883) 9 App.   Cas.  61, Roberts v. Ahern, (1904) I    C.L.R.  406, United States  v. United Mine Workers of America,   (1947) 91 LEd. 884, United States v. The State of California, (1936) 80 L. Ed. 567 Bell v.  The  Municipal  Commissioners for the  City  of  Madras, (1901) I. L. R. 25 Mad. 457, Mersey Docks v. Cameron, (1865) 11  H. L. C. 443 and Coomber v. Justice of Berks,  (1884)  9 App.   Cas. 61, Greig v. University of Edinburgh, (1868)  L. R. I H.   L. (SC.) 348 and Cooper v. Hawkin s. [1904] 2 K. B 164, referred  to. Section 386(1)(a) does not bind the Government by  necessary implication;  the  fact that certain provisions of  the  Act expressly exempt the Government does not raise the necessary implication.  Nor would the purposes of the Act be  defeated if the Government were not bound by it. Hornsey  Urban  Council  v. Hennel, [1902] 2 K.  B.  73  and Province of Bombay v. Municipal Corporation, Bombay,  (1946) L.R. 73 1. A. 271, relied on. Per  Wanchoo, J.-The rule of construction which is based  on the royal prerogative as known to the common law of  England cannot  be  applied to India now when there is no  crown  in India and when the Common law of England is not  applicable. The, proper rule of construction which should be applied now is  that  the  state  is bound by a  statute  unless  it  is exempted expressly or by necessasy implication. Province  of Bombay v. Municipal Corporation of the City  of Bombay, (1946) L. R. 73 1. A. 271, not applied. United States of America v. United Mine Workers of  America,

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Etc.,  (1947)  91 L. Ed. 384, United States  of  America  v. Reginald  P. Wittek, (1949) 93 L. Ed. 1406, Jess  Larson  v. Domestic and Foreign 160 Commerce  Corporation,  (1949) 93 L. Ed.  1628,  H.  Snowden Marshall  v. People of the State of New York, (192O)  65  L. Ed.  315  and Guaranty Trust Company of New York  v.  United States of America, (1938) 82 L. Ed. 1224, referred to. The  Calcutta  Municipal Act, 1923,  does  not  specifically exempt the State from its provisions, As the State cannot be sentenced   to  imprisonment  it  is  exempt  by   necessary implication   from  all  penal  provisions   providing   for sentences  of  imprisonment  or  death.   Further,  where  a statute provides for a fine and the fine goes to the  State, the  State  is  exempted from the  provisions  by  necessary implication  as it could never be the intention that such  a prosecution  should  be launched.  The  prosecution  in  the present case is under s. 488 which provides for a fine for a breach  of  s. 386, and the fine when imposed  and  realised goes  to the State.  Consequently, the State is exempt  from the  penal  provisions  of s. 488 of the  Act  by  necessary implication.

JUDGMENT: CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No. 158  of 1956. Appeal  by special leave from the judgment and  order  dated February  9,  1955, of the Calcutta High Court  in  Criminal Revision  No. 282 of 1954, arising out of the  judgment  and order  dated  December  15, 1953, of  the  Second  Municipal Magistrate, Calcutta, in Case No. 2629C of 1952. 1960.  Feb. 8, 9, 10.  S. M. Bose, Advocate-General for  the State of West Bengal, A. C. Mitra, B. Sen, P. K. Bose and D. Gupta,  for  the  appellant.   Three  questions  arise   for determination  in  this  appeal: (1) whether State  is  a  " person  "  within  the meaning of s.  386  of  the  Calcutta Municipal  Act,  1923, (2) does the  Constitution  make  any change in the principal of prerogative as part of the common law  and  (3)  does Art. 372 of the  Constitution  keep  the existing law intact, i. e., the law as declared in L. R.  73 1.  A. 271 to the effect that the Crown is not bound by  any statute  unless  it is expressly named or unless it  can  be held to be included by necessary implication. The word " person " has been held not to include the  State. [A.I.R. 1954 Punj. 49 ; A.I.R. 57 Punj. 150; A.I.R. 53  Nag. 35  ;  A.I.R.  1955 Nag. 177 ; I.L.R. 1953 1  Cal.  355;  62 C.W.N.  561.  33 Pat. 603 takes the contrary view.]  If  the word  "  person  "  included the  State,  Art.  300  of  the Constitution would not be 161 necessary.   How  far the Crown is bound by  a  Statute  not specifically naming it is laid down by the Privy Council  in L.R.  73  I.A. 271.  The decision of the Madras  High  Court taking  a contrary view in I.L.R. 25 Mad. 457 was not  cited before  the  Privy  Council  and is  based  upon  the  wrong assumption  that  common  law changed  with  the  change  of legislation.  The coming into force of the Constitution does not  alter the law as laid down in L.R. 73 I.A. 271,  I.L.R. 1958  Mad. 801 and I.L.R. 58 Bom. 635.  Article 372  of  the Constitution  includes  the  common  law  of  the  land  and continues  the  same  after the coming  into  force  of  the Constitution.  [I.L.R. 1956 Cal. 26, I.L.R. 1955 Bom.  654]. This  common law doctrine of the immunity of the Crown  from

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Statutes  not specifically naming it or referring to  it  by necessary  implication is applicable in United States  also. [52 L. Ed. 82; 65 L. Ed. 315; 82 L.     Ed. 1224]. M.   C.  Setalvad, Attorney-General for India, R.  Ganapathy Iyer,  R. H. Dhebar and T. M. Sen, for intervener No. 1  The question  is whether the ancient rule of English common  law declared  to be applicable to India by the Privy Council  is applicable  to the construction of s. 386 and it has  to  be examined  as to what was the position before and  after  the Constitution.   The High Court has decided that even  before the Constitution the principle did not apply in spite of the Privy  Council decision.  The statute of 1923 must  be  con- strued  in  accordance  with  the  rule  of   interpretation prevailing  in 1923.  The makers of statute in 1923 did  not intend to include State in the word " person ". The decision of the Privy Council was the binding law of the land  unless there  was  legislation  abrogating it or  taking  away  its effect.  Article 372 of the Constitution actually  continues the law as laid down in L.R. 73 I.A. 271.  This Article uses the expression " of the law in force in India " and not  the words  " existing law ". The same expression is used  in  s. 292  of the Government of India Act and was  interpreted  in [1940] F.C.R. 110.  There  is  nothing in  the  Constitution which takes away    the applicability of the rule.  There is nothing in 21 162 that rule or in its nature repugnant to any provision of our Constitution.  The rule is illustrated in 152 E.R. 406 and I C.L.R.  406.   The  rule  is  applicable  to  all  forms  of Governments and is based on the ground of public policy  and not merely on the ground of prerogative. [91 L. Ed. 884;  93 L. Ed. 1628]. V.   K. T. Chari, Advocate-General for Madras and T.   M. Sen, for intervener No. 4. Supported the Advocate-General of Bengal. H.   M. Seervai, Advocate-General for Maharashtra and R.   H. Dhebar, for intervener No. 5. The word " person " should  be given its normal meaning.  It does not include the Crown  or the  State.   It  would not include  the  State  unless  the statute  would be meaningless without such inclusion.  [L.R. 73  I.A. 271 ; I C.L.R. 406].  By " necessary implication  " is  meant  that without the inclusion of the  crown  or  the State the beneficent purpose of the statute would be  wholly frustrated. The consensus of judicial opinion in Bombay  has been  the same as expressed in L.R. 73 I.A. 271.   The  rule has nothing to do with forms of Government.[93 L. Ed. 1406]. Indian  decisions  have uniformly taken this view.  [5  Bom. H.C.R.  23 ; I.L.R. I Bom. 7 ; I.L.R. 14 Bom. 213;  36  Bom. L.R. 820; 37 Bom.  L.R. 499; I.L.R. 2 All. 196].  I.L.R.  25 Mad. 457 accepts the rule but says that it does not apply to taxation.    This   was  a  wrongful  curtailment   of   the prerogative.  [Halsbury,  Vol.  7, p. 469,  para  98].   The judgments of the Privy Council delivered before January  26, 1950, are binding on all courts in India except the  Supreme Court  and they are binding till the Supreme Court  takes  a different view. [A.I.R. 1953 Cal. 524; A.I.R. 1955 Nag. 293; 56  Bom.   L.R.  1084].  Government of  India  Act,  s.  212 provided that the judgments of the Federal Court and of  the Privy Council shall be binding and shall be followed. S.   M. Sikri, Advocate-General of Punjab and D.  Gupta, for intervener  No. 2. In pre-Constitution statutes the  word  " person  "  could  include  " the Crown  "  but  normally  or ordinarily  it would not so include.  In I.L.R.  1958  Punj. 201  it was held that person " included the State of  Punjab

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and the Union 163 of  India.   The  rule laid down by  the  Privy  Council  is equally applicable to a Republic. [25 L. Ed. 194; 65 L.  Ed. 315; 24 L. Ed. 192 and 85 L. Ed. 1071].  In A.I.R. 1956 Pat. 91 the State has been held to be a person. G.   C. Mathur and C. P. Lal, for intervener No. 3.  Adopted the arguments of the Advocate-General of West Bengal and  of the Attorney-General of India. T.   M. Sen, for intervener No. 6. Adopted the arguments  of the  Advocate-General,  Bengal and the  Attorney-General  of India. N.   C.  Chatterjee,  Sunil K. Basu and Sukumar  Ghose,  for respondents.  Section 386 is directed towards maintenance of healthy  condition  etc. and is a  wholesome  provision  for safeguarding  the health of the people by providing for  the control  of  storing  houses and for  the  equality  of  the stores.   The  financial  aspect, i.  e.,  the  recovery  of license fees or fine is inconsequential.  The prerogative of immunity from the statutes is only available when the  State acts  as  State  and  not when  it  descends  to  trade  and business.  State is a person.  Salmond, 11th Edition, p. 35, defines  person as an entity capable of rights  and  duties. It  has the power to hold and acquire property ; it can  sue and  be sued [Article 300 of the Constitution ; 60.Punj.  L. R.  546.].  The correct rule of interpretation  is  that  to exempt the State from the operation of a statute there  must be express exclusion in favour of the State. [Friedman in 13 Modern Law Review, 24].  The mere fact that the State cannot be sent to jail, does not indicate that it is not a  person. A  Corporation  is  a  person.  It  is  the  stigma  of  the conviction that matters and it is not a question of  hurting the  State  financially. [1944] 1 K. B. 146;  [1950]  S.C.R. 720.  A Corporation can be prosecuted even where mens rea or state  of  mind is concerned. [Paton on  Jurisprudence,  2nd Edition,  p.  279].   Sanctions of criminal  law  should  be available against the State for enforcing the law. [72 C. L. R.  409;  Willis’  Constitution Law, p.  37].   State  is  a person. [78 L. Ed. 1307; I. L. R. [1951] 1 All. 269].   When State  engages in trade or commerce, it must be  treated  in the same 164 way as ordinary citizens. [A. 1. R. 1955 Nag. 177; A. 1.  R. 1956 Pat. 91.]  State is not a person only for the  purposes of Art. 14. The doctrine of immunity of States from the operation of its laws cannot be invoked in the present constitutional set up. The  rule  is based on royal prerogative. [1 C. L.  R.  406; Willis  p. 54].  The rule springs from the prerogative  that the King can do no wrong.  [1920] 2 A. C. 5081.  There is no one  equivalent to the King now in India and  therefore  the prerogative  does  not survive.  Law is a scheme  of  social control and the command of a superior.  If the State  claims immunity,  it  must  be  exempted  by  express  legislation. Immunity  cannot  be implied.  There  has  been  progressive restriction  on the immunity of the State. [78 L. Ed.  1307; 90  L. Ed. 326]. I.L. R. 25 Mad. 457 lays down  the  correct law.   After the coming into force of the Constitution,  the High  Courts  are  not bound by the judgment  of  the  Privy Council.   All powers are derived from the Constitution  and no immunities can be implied. Even  if  any  immunity can be implied, then  it  cannot  be invoked in respect of any trading or commercial activity. [5 Bom.   H. C. R. Appendix 1 at p. 13; 78 L. Ed. 1307;  90  L. Ed.  326].  The activity carried on by the State in  storing

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food grains etc., and distributing them was trading activity and not exercise of Governmental function. The   State  is  bound  by  necessary  implication  by   the provisions  of the Calcutta Municipal Act, 1.923. There  are provisions in the Act which expressly exempt the State  from their operation.  See s. 126. S.   M.  Bose  in  reply.-Common  law  can  be  amended   by legislation.   See s. 4, Hindu Succession Act (30  of  1956) and Hindu Adoptions and Maintenance Act (78 of 1956).  There is  difference between Civil and Criminal liability. [72  C. L. R. 406, at 409, 424, 425].  The State is not carrying  on any  trading  activity  but is acting  in  the  exercise  of essential  Governmental functions.  [1955] 1 S. C. R.  707]. Common law of England was introduced in the Presidency towns by statutes.  See Ormond’s Rules of Court; 1. L. R. 61  Cal. 841. 165 H.   M. Seervai, (with the permission of the Court).  It  is a settled rule that if a word is not a term of art, you must take the ordinary meaning and not go to technical books. [74 C. L. R. 1; 90 L. Ed. 396; Halsbury Vol. 7, p. 221]. S.   M.  Sikri, (with the permission of the Court)  referred to Holdsworth History of the English Law,’ Vol. 10, p. 354.                                Cur. adv. vult. 1960.   August  16.-The Judgment of Sinha,  C.J.,  Imam  and Shah,  JJ.,  was  delivered  by Sinha,  C.  J..  Sarkar  and Wanchoo, JJ., delivered separate judgments. SINHA C. J.-This appeal by special leave is directed against the  judgment and order of the High Court at Calcutta  dated February  9,  1955, whereby that Court,  in  its  revisional jurisdiction, set aside an order of acquittal dated December 15,  1953, passed by the Municipal Magistrate, Calcutta,  in respect  of the prosecution launched by the  Corporation  of Calcutta, respondent in this Court, against the appellant. The  relevant  facts  are  these.   On  July  1,  1952,  the Corporation  of  Calcutta made an  application  for  summons under  s.  488  of  Bengal  Act  III  of  1923,  which   was substituted by West Bengal Act XXXIII of 1951, against " the Director of Rationing and Distribution representing the Food Department  of the Government of West Bengal ". The  offence complained  of  was  " for using or permitting  to  be  used premises  No. 259, Chitpur Road, Upper, for the  purpose  of storing  rice  etc.,  under the  provisions  of  the  Bengal Rationing  Order, 1943, without a licence under s.  386  for the  year, 1951-52, corresponding s. 437 of the C.M.C.  Act, 1951  ". Section 386(1)(a) of the Calcutta Municipal Act  is in these terms:- ,, No person shall use or permit to be used any premises for any  of the following purposes without or otherwise than  in conformity  with  the  terms of a  licence  granted  by  the Corporation  in  this behalf, namely, any  of  the  purposes specified in Schedule XIX 166 Item 8 of the said Schedule is " storing, packing, pressing, cleansing,  preparing  or  manufacturing,  by  any   process whatever,  any  of the following articles and  the  articles mentioned include rice, flour, etc. The  facts  alleged by the prosecution were  not  denied  in behalf  of the Department, which was in the position of  the accused,  but  it  was contended by  way  of  a  preliminary objection that the prosecution was not maintainable in  law. After  hearing arguments for the parties the  learned  trial Magistrate  passed an order acquitting the  accused  relying upon  a decision of the Calcutta High Court in the  case  of The  Corporation of Calcutta v.  Sub-Postmaster,  Dharamtala

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Post Office(1), holding that the provisions of s. 386 of the Act,  neither in terms nor by necessary  implication,  bound the  Government.   The respondent moved  the  Calcutta  High Court  in its revisional jurisdiction in  Criminal  Revision No.  282  of  1954,  which was heard  by  a  Division  Bench consisting  of J. P. Mitter and S. N. Guha Ray,  JJ.   Cxuha Ray,  J., who delivered the judgment of the  Court,  Mitter, J., concurring, held that the previous decision of the  same High Court in The Corporation of Calcutta v. Sub-Postmaster, Dharamtala Post Office (1) was clearly distinguishable.  The distinction  pointed out was that the previous  decision  of the  Court  had  relied upon the decision  of  the  Judicial Committee  of  the Privy Council in Province  of  Bombay  v. Municipal  Corporation of the Citu of Bombay (2), in a  case arising  before the coming into force of  the  Constitution. As the present case arose after the advent of the  Constitu- tion,  the  High Court did not feel bound by  the  aforesaid decision  of  the Privy Council and therefore  examined  the legal  position  afresh.  On such an examination,  the  High Court came to the conclusion that the Indian Legislature  in enacting  laws acted on the assumption that  the  Government would  be  bound  unless excluded  either  expressly  or  by necessary implication oftener than on the assumption that it would  not  be  bound, unless the  Legislature  so  provided expressly or by necessary implication.  The High Court  took the view that the decision of the Division (1) (1948) 54 C.W.N. 429. (2) (1946) L.R. 73 I.A. 271. 167 Bench  of  the Madras High Court in Bell  v.  The  Municipal Commissioners  for  the  City  of Madras  (1)  was  more  in consonance  with  the law in India than  the  opposite  view expressed  in  the Privy Council judgment  aforesaid.   They definitely  decided that the law of India, even  before  the coming  into effect of the Constitution, 7 and even  at  the time  of the passing of the Government of India  Act,  1935, was that the Government was bound by a Statute unless it was exempted  either expressly or by necessary implication.   In that  view  of the matter, the High Court  further  observed that  the  question whether the decision  aforesaid  of  the Privy  Council  was  still good law under Art.  372  of  the Constitution  did  not  arise and that, if it  did,  it  was inclined  to  the view that the law declared  by  the  Privy Council  was  not  continued by any provision  of  law.   In effect,  the  High Court took the view that  the  State  was bound  by  the  Statute  unless it  was  excluded  from  its operation either expressly or by necessary implication.   In that  view  of the matter, it held that s. 386  of  the  Act bound  the appellant, set aside the order of  acquittal  and sent  the case back to the learned Magistrate  for  disposal according  to  law.  The appellant made an  application  for special  leave  to appeal from the  aforesaid  judgment  and order  of  the  High Court, and obtained  special  leave  in September  1955.   It  is  thus clear  that  this  case  had remained  pending  in this Court for about five  years.   If this Court agreed with the view expressed by the High Court, the  case  would have to be tried on merits  and  the  trial would  begin more than eight years after the institution  of the  petition of complaint, but, as will  presently  appear, this prosecution was misconceived and therefore, in  effect, no  one  has  been the worse for the long  pendency  of  the prosecution, which now must come to an end. The  short  question  for determination in  this  appeal  is whether any offence had been committed by the appellant,  as alleged  against him.  If he was bound by the provisions  of

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the  Act to take out a licence on payment of  the  necessary fees, he must be held to have contravened the provisions  of that Statute.  It has (1)  (1901) I.L.R. 25 Mad.. 457. 168 been  contended by the learned Advocate-General  of  Bengal, representing  the appellant, that the decision of the  Privy Council  referred  to above is still good law and  that  the contrary  decision of the Division Bench of the Madras  High Court  (1)  did  not  take the correct  view  of  the  legal position.   The argument further is that the  Privy  Council decision was certainly binding on the Courts in India at the time  it  was  rendered.  That was the law of  the  land  as declared  by  the  highest  judicial  authority.   Has  that judicial determination been altered by the Constitution ? It has been argued that the law in India, even after the coming into effect of the Constitution, continues to be the same as the  law  in England in respect of the prerogatives  of  the Crown.   The  Act  in question does  not  make  any  express provision  binding the Government and there was  nothing  in the  Act to show to the contrary by  necessary  implication. The Act could operate with reasonable efficacy without being held  to  be  binding on the  Government.   It  was  further pointed out that the High Court had failed to take into con- sideration  the  fact  that  that  High  Court  itself   had construed  the  Calcutta Municipal Act of  1923,  which  was replaced  by  the present Act of 1951, on the basis  of  the Privy  Council  decision not to have bound  the  Government. The  Act  of  1951  did not  make  any  provision  expressly abrogating  that view.  Hence, it is argued the  High  Court should have felt bound by the previous decision of that very Court given on the basis of the Privy Council decision;  and had erred in taking the opposite view.  The argument further was that the State is not a person within the meaning of the penal  section with reference to which the  prosecution  had been   launched.   The  common  law  could  not  have   been overridden impliedly by a course of legislation.  The common law  applies  to  India even  after  the  Constitution,  not because  there is the King or the Queen, but because  it  is the law in force.  In other words, what was the prerogrative of  the  sovereign  has now become the law of  the  land  in respect  of the sovereignty of the State.  Thus the  law  of England, which (1)  (1901) I.L.R. 25 Mad, 457. 169 in  its  source was the prerogative of the  Crown,  was  the common  law of the land and was adopted by the  Constitution by Art. 372, subject to the reservations contained  therein. The Attorney-General for India as also the Advocates-General of  Madras  and Bombay supported the  contention  raised  on behalf of the appellant. Mr.  N.  C.  Chatterjee,  who  appeared  on  behalf  of  the respondent,  contended that the State is a legal  person  as recognised  in  Art.  300  of  the  Constitution  and   was, therefore,  capable of rights and obligations;  that  unless there   is  an  express  exclusion  of  the  State  by   the Legislature,  the  Act  would apply to  all,  including  the State.   He  further contended that under  the  Constitution there  is  no  King  and, therefore,  there  cannot  be  any question  of prerogative.  Any exemption from the  operation of  the statute must be found in express immunity under  the law  and  cannot  be  implied.  He went  to  the  length  of contending  that a State’s prerogative is inconsistent  with the  whole Constitution.  Whatever may have been  the  legal position before the coming into effect of the  Constitution,

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it  has  not  countenanced  the  continuance  of  any   such prerogative as is contended for on behalf of the  appellant. Another line taken by Mr. Chatterjee is that when the  State embarks  upon  a business, it does so not in  its  sovereign capacity, but as a legal person, subject to the same  rights and liabilities as any other person.  In effect,  therefore, he  contended that the State is a person within the  meaning of  s.  386  of the Act; that the doctrine  of  immunity  of States  from  the operation of its laws  cannot  be  invoked after  the advent of the Constitution,  and,  alternatively, that  even  if the immunity is available to the State  as  a sovereign  power, it is not available to the State  when  it embarked  upon  a commercial undertaking and  that.  in  any case, the State was bound by the law by applying the rule of necessary implication from the provisions of the Act. In  this  case it is manifest that it is the  Government  of West Bengal which is sought to be prosecuted 22 170 through one of its officers.  The prosecution is not against a  named  person,  but  against  the  Director  of  a  named Department  of  the  Government.  The  person  who  was  the Director of the Department at the relevant date, that is  to say,  in  the year 1951-52 may not be the  same  person  who answered  that description on the date the  prosecution  was launched.   In essence, therefore, it is the  Government  of West  Bengal which has to answer the charge levelled by  the respondent,   the  Corporation  of  Calcutta.    Whether   a prosecution  against such an indeterminate person  would  or would  not  lie is a matter which has not been  raised  and, therefore,  need  not  be  discussed.   The  question   most canvassed before us in whether the penal section invoked  in this case applies to Government.  It has been contended, and in  our  opinion rightly, that the provisions of  the  penal section   neither   by  express  terms  nor   by   necessary implication  are  meant to be applied  to  Government.   The decision of the Judicial Committee ’of the Privy Council(1), if it is good law even now, completely covers this case, but the  decision of the High Court, now under examination,  has taken  the  view that the earlier decision of  the  Division Bench  of  the  Madras High Court (2 )  has  laid  down  the correct  law, and not the Privy Council decision.  We  have, therefore,  to decide which of the two decisions  has  taken the correct view of the legal position as it obtained on the day the prosecution was launched. It  is  well-established that the common law of  England  is that the King’s prerogative is illustrated by  the rule that the  Sovereign is not necessarily bound by a  statutory  law which  binds the subject.  This is further enforced  by  the rule  that the King is not bound by a statute unless  he  is expressly   named  or  unless  he  is  bound  by   necessary implication  or  unless the statute, being  for  the  public good,  it  would  be absurd to exclude  the  King  from  it. Blackstone  (Commentaries,  Vol.   I,  261-262)   accurately summed up the legal position as follows:- "The  king is not bound by any act of Parliament, unless  he be named therein by special and (1) (1946) L.R. 73 I.A. 271. (2) [1901] I.L.R. 25 Mad. 457. 171 particular  words.   The  most general  words  that  can  be devised...... affect not him in the least, if they may  tend to restrain or diminish any of his rights or interests.  For it  would be of most mischievous consequence to the  public, if  the  strength of the executive power were liable  to  be

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curtailed  without its own express consent by  constructions and  implications  of  the subject.  Yet,  when  an  act  of Parliament is expressly made for the preservation of  public rights  and the suppression of public wrongs, and  does  not interfere  with the established rights of the crown,  it  is said  to  be  binding  as well upon the  king  as  upon  the subject; and, likewise, the king may take the benefit of any particular  act, though he be not specialty named."  (Quoted at p. 355 of Holdsworth, A History of English Law, Vol.  X). The King’s prerogative is thus created and limited by common law and the sovereign can claim no prerogative, except  such as the law allows. (See Halsbury’s Laws of England, Vol.  7, Third Edition, para. 464, at p. 22 1). The prerogative of the Crown in respect of property is  thus stated  in  the same volume of Halsbury’s Laws  of  England, para. 980, at p. 465:- "The  Crown  not  being bound by  any  statute  whereby  any prerogative right, title, or interest belonging to it may be divested  or  abridged, unless expressly named or  bound  by clear implication, property owned, and occupied by the Crown is  exempt  from taxation unless rendered liable  either  by express  words  or  necessary  implication.   Moreover,   an express exemption of particular classes of Crown property in a  statute  is  not  in  itself  sufficient  to  raise   the implication  that  such property only is  exempt,  and  that other  property not falling within the exception  is  bound, such clauses being inserted merely ex majore cautela."  That was  the  law applicable to India also,  as  authoritatively laid  down  by  the Privy Council in the  case  referred  to above.   That decision was rightly followed by the  Calcutta High  Court  as  stated  above.  That  would  be  the  legal position until the advent of the Constitution. 172 The question naturally arises: whether the Constitution  has made any change in that position ? There are no words in the Constitution   which  can  be  cited  in  support   of   the proposition   that  the  position  has  changed  after   the republican  form  of Government has been adumbrated  by  our Constitution.   It  was argued on behalf of  the  respondent that the existence of such a prerogative is negatived by the very  form  of  our  new set up, that  is  to  say,  it  was contended  that the republican form of Government is  wholly inconsistent  with the existence of such a prerogative.   In our opinion, there is no warrant for such a contention.  The immunity  of  Government  from  the  operation  of   certain statutes,  and particularly statutes creating  offences,  is based  upon the fundamental concept that the  Government  or its  officers  cannot  be a party  to  committing  a  crime- analogous to the I prerogative of perfection’ that the  King can  do  no wrong.  Whatever may have  been  the  historical reason  of the rule, it has been adopted in our  country  on grounds  of  public policy as a rule  of  interpretation  of statutes.   That this rule is not peculiar or confined to  a monarchical  form  of  Government  is  illustrated  by   the decision  of  the Supreme Court of U. S. A. in the  case  of United  States of America v. United Mine Workers of  America (1), where it is laid down that restrictions on the issue of injunctions in labour disputes contained in certain statutes do not apply to the United States Government as an  employer or to relations between the Government and its employees and that statutes in general terms imposing certain restrictions or  divesting certain privileges will not be applied to  the sovereign without express words to that effect.   Similarly, in  the  case  of United States of America  v.  Reginald  P. Wittek  (2),  the  question arose whether  the  District  of

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Columbia  Emergency  Rent Act  applied  to  government-owned defence  housing or to government owned low-rent housing  in the  District,  and  it  was ruled  by  the  Supreme  Court, reversing  the decision of the Municipal Court  of  Appeals, that  the  statute in question did not apply to  the  United States Government (1) (1947) 330 U.S. 258: 91 L. Ed. 884. (2) (1949) 337 U.S. 346: 93 L. Ed. 1406. 173 which was not a " landlord " within the meaning of the  Act. The  decision was based on the rule that a  general  statute imposing   restrictions  does  not  impose  them  upon   the Government itself without a clear expression or  implication to  that effect.  Another illustration of the rule is to  be found  in  the case of Jess Larson v. Domestic  and  Foreign Commerce Corporation (1).  In that case a suit by a citizen, in    effect,   against   the   Government    (War    Assets Administration)  for  an  injunction was  dismissed  by  the District  Court  on the ground that the Court did  not  have jurisdiction,  because the suit was one against  the  United States.  The Supreme Court, by majority, held that the  suit as  against the United States must fail on the  ground  that according  to the laws of the country the sovereign  enjoyed an immunity which was not enjoyed by the citizens.  The case of Roberts v. Ahern (2) is another illustration of the  same rule.   It was held by the High Court of Australia  in  that case that the Executive Government of the Commonwealth or of a State is not bound by a statute unless the intention  that it shall be so bound is apparent. On  the  other  hand,  Art.  372  of  the  Constitution  has specifically  provided that subject to the other  provisions of  the Constitution all the laws in force in  this  country immediately  before  the commencement  of  the  Constitution shall continue in force until altered or repealed or amended by a competent Legislature or by other competent  authority. The  expression  " law in force " has been used  in  a  very comprehensive  sense as would appear from the provisions  of sub-  cls.  (a)  and  (b)  of  cl.  (3)of  Art.  13  of  the Constitution.  If we compare the provisions of Art.  366(10) which  defines " existing law " which has reference  to  law made by a legislative agency in contradistinction to "  laws in  force " which includes not only statutory law, but  also custom  or  usage  having  the force  of  law,  it  must  be interpreted as including the common law of England which was adopted  as the law of this country before the  Constitution came into force.  It is thus clear that far from (1)  (1949) 337 U.S. 682 : 93 L. Ed. 1628. (2)  (1904) I. C.L.R. 406. 174 the Constitution making any change in the legal position, it has  clearly  indicated that the laws in force  continue  to have  validity, even in the new set up, except in so far  as they  come  in conflict with the express provisions  of  the Constitution.   No  such provision has been brought  to  our notice.   That  being so, we are definitely of  the  opinion that  the rule of interpretation of statutes that the  State is  not  bound  by a statute, unless it is  so  provided  in express  terms  or by necessary implication, is  still  good law. But  Mr. Chatterjee further contended,  alternatively,  that even  if  it were held that the Government  as  a  sovereign power  may have the benefit of the immunity claimed,  it  is not  entitled  to  that  immunity when  it  embarks  upon  a business and, in that capacity, becomes subject to the penal provisions of the statute equally with other citizens.  This

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question was not raised below and has not been gone into  by the High Court, nor is it clear on the record, as it stands, that  the Food Department of the Government of West  Bengal, which  undertook  rationing and distribution of  food  on  a rational basis had embarked upon any trade or business.   In the  absence of any indication to the  contrary,  apparently this  Department  of  the  Government  was  discharging  the elementary  duty  of  a  sovereign  to  ensure  proper   and equitable distribution of available food-stuffs with a  view to  maintaining peace and good Government.   Therefore,  the alternative argument suggested by Mr. Chatterjee has no foundation in fact. It  only remains to consider the other alternative  argument that  even  if  the State has not been bound  by  the  penal section in the statute in question in express terms, it must be  deemed to be bound by it by necessary implication.   But no specific provisions of the statute in question have  been brought  to our notice which could lend any support to  this alternative  argument.  It has not been shown to us that  if the  section  which  was sought to be  applied  against  the Government  were held not expressly to apply to  Government, the  law will lose any of its efficacy, or that its  working will be hampered in any way.  It must, therefore, be 175 held that there is no substance in this contention either. The appeal is accordingly allowed, the judgment under appeal set aside and the acquittal of the appellant confirmed. SARKAR  J.-The appellant is an officer of the Government  of West   Bengal.   He  was  prosecuted  before   a   Municipal Magistrate of Calcutta for storing rice in certain  premises without  obtaining  a  licence for  that  purpose  from  the respondent,  the Corporation of Calcutta, as required by  s. 386  of the Calcutta Municipal Act, 1923.  That was  an  Act passed  by the legislature of the former Province of  Bengal and  may,  for the present purpose, be taken  to  have  been passed  by the legislature of the State of West Bengal.   In storing  the  rice the appellant had acted in  his  official capacity  and for carrying out the West Bengal  Government’s rationing scheme. The Magistrate acquitted the appellant holding that the  Act did not bind the Government as it was neither expressly  nor by  necessary implication made bound, and so, the  appellant who had been prosecuted as representing the Government would not  be liable for non-compliance with its  provisions.   On revision  the High Court at Calcutta held that  the  English rule that a statute did not bind the Crown unless  expressly or  by  necessary implication made bound, did not  apply  to Indian  statutes and so the Government would be  liable  for breach of the provisions of the Calcutta Municipal Act.   In this view of the matter, the High Court set aside the  order of  acquittal and sent the case back to the  Magistrate  for disposal on the merits.  This appeal has been taken from the order  of the High Court with special leave granted by  this Court. The main question is whether the English rule that The Crown is  not bound by the provisions of any statute unless it  is directly  or by necessary implication referred to "  applies to India.  It is said that the rule is based on the  English law  of Crown prerogatives and has no application  to  India since the promulgation of our Constitution as we have now  a republican 176 form  of government where no question of royal  prerogatives can  arise.  It is pointed out that the prosecution  was  in this case started since the Constitution came into force and

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whatever may have been the position earlier, the  Government can no longer take shelter under the English rule. I   think  the  rule  applies  to  India  even   after   the Constitution.   It seems to me that the rule as  applied  in modern  times, is really a rule of construction of  statutes and  is  not dependent on royal prerogatives.  This  is  the view  that  appears  to  have  been  taken  in  all   recent authorities, to some of which I wish now to refer. In Craies on Statutes (5th Ed.) it is stated at p. 392  that "  The  rule is analogous, if not equivalent,  to  the  rule already  stated  that the common law is not presumed  to  be altered  by statute ". The rule, therefore, is based on  the presumed intention of the legislature and is, hence, a  rule of  construction  of  statutes.  Then I find  it  stated  in Attorney-General  v.  Donaldson  (1) that "  It  is  a  well established rule, generally speaking, in the construction of Acts  of  Parliament, that the King is not  included  unless there  are  words to that effect; for it is  inferred  prima facie that the law made by the Crown with the assent of  the Lords  and  Commons, is made for subjects and  not  for  the Crown".   Again in Comber V.  Justices of Berks (2)  it  was said  in  reference to this rule, " In Rex v. Cook,  3  T.R. 519,  the  general  principle  as  to  the  construction  of statutes imposing charges as containing an exemption of  the Crown was laid down ". In the Australian case of Roberts  v. Ahern  (3), it was said, "This rule has commonly been  based on  the Royal prerogative.  Perhaps, however, having  regard to  modern  developments  of  constitutional  law,  a   more satisfactory basis is to be found in the words of  Alderson, B."  The words referred to are what I have already  set  out from Attorney-General v. Donaldson (1). In America too this rule has been applied as a rule (1)  (1842) 10 M. & W. 117, 123; 152 E.R. 406. (2)  (1883) 9 App.  Cas. 61, 65. (3)  (1904) 1.C.L.R. 406, 417. 177 of  construction  though  there is no  King  there  but  the government  is of the republican form.  So in United  States v.  United  Mine Workers of America (1) it was  observed,  " There  is an old and well-known rule that statutes which  in general terms divest pre-existing rights or privileges  will not  be  applied to the sovereign without express  words  to that  effect.  It has been stated, in cases in  which  there were  extraneous and affirmative reasons for believing  that the sovereign should also be deemed subject to a restrictive statute,  that this rule was a rule of construction only  ". Again  in reference to the same rule it was said  in  United States V. State of California (2).  " The presumption is  an aid  to consistent construction of statutes of the  enacting sovereign when their purpose is in doubt ". In  our country also in Bell v. The Municipal  Commissioners for the City of Madras(3), a case on which much reliance has been  placed by the respondent, it was said after  referring to  various  English  cases dealing with the  rule,  "  This emphatic  statement of the rule being founded  upon  general principles of construction is undoubtedly applicable as much to Indian enactments as to Colonial or Imperial Statutes  ". It  was also said at the same page, " The rule of  construc- tion  above  adverted  to cannot itself  be  regarded  as  a prerogative of the Crown ". Then  I  find  that in England the rule  protects  from  the operation of a statute not only what may strictly be  called Crown  prerogatives, or whatever is nowadays left  of  them, but  all  the  Crown’s  rights,  title  and  interest:   see Halsbury’s Laws of England (3rd Ed.) Vol.  VII, p. 465.   In

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volume XXXI of the Second Edition of the same treatise it is stated with reference to the rule that, " The Crown for this purpose  means  not only the King personally, but  also  the officers  of  State and servants of the  Crown  when  acting within  the scope of their authority on behalf of the  Crown in the discharge of executive duties ". In Mersey Docka (1)  (1947) 330 U. S. 258, 272 ; 91 L. Ed. 884, 902. (2)  (1936) 297 U. S. 175, 186; 80 L. Ed. 567, 574. (3)  (1901) I.L.R. 25 Mad. 457, 485. 23 178 v.   Cameron(1),  Lord  Cranworth  after  referring  to  the various instances where the rule had been applied to  exempt buildings occupied for purposes of the government from rates and other impositions, said, " These decisions however  have all gone on the ground more or less sound, that these  might all be treated as buildings occupied by the servants of  the Crown,  and for the Crown, extending in some  instances  the shield of the Crown to what might more fitly be described as the public government of the country ". Again in Coomber  v. Justices  of  Berks (2), Lord Blackburn after  referring  to certain  observations of Lord Westbury in the  Mersey  Docks case(1)  said,  "He there says that the public  purposes  to make an exemption " must be such as are required and created by the government of the country, and are, therefore, to  be deemed  part  of the use and service of the Crown;"  and  in Greig  v. University of Edinburgh (3) be more clearly  shews what was his view by using this language, "property occupied by  the servants of the Crown, and (according to the  theory of  the Constitution) property occupied for the purposes  of the administration of the government of the country,  become exempt  from liability to the poor-rate "." In this case  it was  held that lands with buildings constructed thereon  and used  by county justices, and for police purposes  were  not liable to income-tax.  In Cooper v. Hawkins (4) it was  held that  an  engine-driver employed by the Crown  who  drove  a steam-locomotive  on Crown service at a speed exceeding  the limit specified by regulations made under a statute, was not liable  as in the absence of express words, the statute  did not bind the Crown.  Lastly, I refer to Roberts v. Ahern (5) where a person acting under the orders of the Government  of the Commonwealth of Australia had been prosecuted for having carted  away nightsoil from a Post Office without a  licence from,  and without having given any security to,  the  local authority  as was required by an enactment of the  State  of Victoria.  It was held that he was not liable to prosecution because, (1)  (1865) 11 H.L.C. 443, 508; 11 E.R. 1405. (2)  (1883)  9  App.  Cas. 61, 65.  (3)  (1868)  L.R.I  H.L, (SC.)348. (4) [1904] 2 K.B. 164.      (5) (1904) 1. C.L.R. 406, 417. 179 "  The  modern sense of the rule, at any rate, is  that  the Executive  Government of the State is not bound by  Statutes unless  that intention is apparent: " p. 418.  It  was  also said  that " The doctrine is well settled in this  sense  in the United States of America: " (p. 418).  It is unnecessary to multiply instances where acts of the executive government have received the protection of the rule. All  this would seem to put it beyond doubt,  that  whatever its  origin, the rule has long been regarded only as a  rule of  construction.   It  has  been  widely  used  to   exempt executive  governments from the operation of statutes  quite apart  from  protecting prerogative rights  of  the  British Crown  strictly so called.  It has been held  reasonable  to

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presume   that  the  legislature  intended  that   executive governments  are  not to be bound by  statutes  unless  made bound  expressly or by necessary implication.  It  would  be equally reason. able to do so in our country even under  the present set up for the presumption has all along been raised in the past and especially as the applicability of the  rule can  no longer be made to depend on the prevailing  form  of government.    In  countries  with  a  republican  form   of government, the Sovereign would be the State, and its  acts, which  can only be the acts of its executive limb would  be, under  the rule exempt from the operation of  its  statutes. Whether  the  royal prerogative as  understood  in  England, exists  in the present day India is not a question that  can arise  in  applying what is a pure rule of  construction  of statutes. Further it is quite clear that the rule has been applied  by courts  in India in the construction of Indian statutes  all along at any rate upto the promulgation of our Constitution, except  in the solitary instance of Bell’s case (1)  earlier referred  to.  It would therefore be right to hold that  the legislatures in our country have proceeded on the basis that the  rule would govern the enactments passed by them.   That being   so  and  remembering  that  the  rule  is   one   of construction,   there  would  be  no  reason  to  deny   its application to Indian statutes after the Constitution.   The Dew republican (1)  (1901) I.L.R. 25 Mad. 457. 180 form  of  government  adopted  by us  would  not  warrant  a departure from the long established rule of construction. It  was  then said that the course of legislation  in  India would  indicate  that it was not intended  even  before  the Constitution  that the rule would apply to Indian  statutes. This  contention  was based on Bell’s  case(1).   That  case seems to me to have proceeded on a basis not very sound.  On an examination of certain Indian statutes it was said, "  It is noteworthy that as a general rule government is specially excluded  whenever the Legislature considered  that  certain provisions of an enactment should not bind the Government ". From  this the conclusion was drawn that "According  to  the uniform  course  of Indian  legislation,  statutes  imposing duties  or  taxes bind Government as much as  its  subjects, unless  the very nature of the duty or tax is such as to  be inapplicable  to the Government ". It seems to me that  this decision overlooks the uniform course of decisions of Indian Courts  applying  the  rule in the  construction  of  Indian statutes.   The legislature must be deemed to have known  of these  decisions  and if they wanted to  depart  from  their effect  they would have passed a statute bringing about  the desired  result.   No such statute was ever passed.   It  is wellknown that in these circumstances the legislatures  must be  taken to have proceeded on the basis that the  decisions were correct and the rule was to be applied to the  statutes passed by them.  That being so, an examination of the course of Indian legislation would be irrelevant.  The cases  where the  Government was expressly excluded must be taken  to  be instances of exemptions ex majori cautila: see Hornsey Urban Council  v. Hennel(2).  Furthermore, it seems to me  that  a comparison  of the number of statutes where  the  Government had  been specially excluded from their operation  with  the number where the statutes are silent on the subject, is,  at best,  a  very unsafe guide for deciding  whether  the  rule should be applied to Indian enactments.  I therefore dissent from  the  view expressed in Bell’s case(1), that  the  rule does not apply in India.

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(1) (1901) I.L.R. 25 Mad. 457. (2) [1902] 2 K.B. 73. 181 Now  it seems to me that in storing the rice in the  present case,  the Government of West Bengal was performing  one  of its  governmental  functions.   It  was  storing  rice   for purposes of rationing, that is, making food-stuff  available to  citizens in time of scarcity.  That such activity  is  a part  of the government’s duty is unquestionable.   The  act for  which the appellant was prosecuted was,  therefore,  an act  of the West Bengal Government done in discharge of  its ordinary duties as the government and the rule would prevent the  Act from applying to make the Government liable  for  a breach of it. Then  it  is  said  that the Act  binds  the  Government  by necessary implication.  In support of this argument we  were referred  to certain provisions of the Act  which  expressly exempted  the Government from their operation.  I am  unable to agree that this raises the necessary implication.  It has been said in Halsbury’s Laws of England (2nd Ed.) Vol.  XXXI at  p. 523 that " A general prerogative of the Crown is  not deemed  to have been abandoned by implication by  reason  of the  specific  exemption in a statute of any  class  of  the servants  of  the Crown from acting in compliance  with  the prerogative,  nor by reason of the :fact that the Crown  has foregone or curtailed its rights in some other direction  in another  part  of  the statute " ; see  also  Hornsey  Urban Council  case (1) earlier referred to.   These  observations would  show the unsoundness of the contention raised by  the respondent. Lastly,  it  is  said that the purpose of  the  Act  was  to prevent adulteration of food-stuffs and this object would be wholly  defeated unless the Government was bound by it.   It is  not  in dispute that if this were so, that  might  be  a ground  for holding that the Act bound the  Government.   On this aspect of the case reference may be made to Province of Bombay v. Municipal Corporation of Bombay (2).  I am however unable  to hold that the purpose of the Act would be  wholly or  at all defeated if the Government were not bound by  it. It  seems to me that s. 386 of the Act, the breach of  which is complained in this case, is concerned with (1) [1902] 2 K.B. 73. (2) (1946) L.R. 73 I.A. 271. 182 the  use  of  premises  and  not  with  the  prevention   of adulteration  of  food-stuffs  as  was  contended  for   the respondent.   The provisions with regard to adulteration  of food-stuffs  are  contained  in a,  different  part  of  the statute.   There is nothing to show that the purpose of  the Act  would  wholly be defeated if some  premises  were  used contrary to the terms of the Act. I would for these reasons hold that the Act did not bind the Government  and the prosecution of the appellant for an  act done  in  the discharge of his duties as an officer  of  the Government   cannot  be  maintained.   This  appeal   should therefore  be  allowed and the order of the High  Court  set aside and that of the Magistrate restored. WANCHOO J.-I have had the advantage of reading the judgments prepared by my Lord the Chief Justice and my brother  Sarkar J.  I  agree  with  their  conclusion  but  my  reasons  are different.   I  therefore proceed to state  my  reasons  for coming to the same conclusion. The  facts  have already been stated in the judgment  of  my Lord the Chief Justice and I will not therefore repeat them. Suffice it to say that the Corporation of Calcutta initiated

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this prosecution, in substance, of the State of West  Bengal through its Director of Rationing and Distribution under  s. 488  of  the Calcutta Municipal Act, No. 111 of  1923,  (now equivalent  to  s. 537 of the Calcutta  Municipal  Act,  No. XXXIII of 1951), for using or permitting to be used  certain premises  for  the purpose of storing rice, etc.  under  the provisions  of the Bengal Rationing Order, 1943,  without  a licence under s. 386 of Act III of 1923, (now equivalent  to s.  437 of Act XXXIII of 1951).  The State did not deny  the facts;  but  it  was  contended  on  its  behalf  that   the prosecution  was  not maintainable in law.   The  Magistrate held  that the provisions of s. 386 of the 1923 Act did  not apply  to  the  State  either  expressly  or  by   necessary implication and therefore passed an order of acquittal.  The Corporation  took the matter in revision to the High  Court, which  distinguished an earlier decision of the  High  Court relied  upon  by the Magistrate and held  that  after  India became a 183 democratic  republic from January 26, 1950, the  High  Court was  not  bound by the decision of the Privy  Council  in  a similar  matter reported in Province of Bombay v.  Municipal Corporation  of the City of Bombay (1) and that the rule  of construction  based on the royal prerogative that the  Crown was  not  bound by a statute unless it was  expressly  named therein  or  at  any  rate could be  held  to  be  bound  by necessary implication, did not apply in India after  January 26,  1950, and that the true rule of construction  on  which the  Indian legislatures acted was that the State  would  be bound  unless  excluded  either expressly  or  by  necessary implication.   The High Court therefore held that s. 488  of the  Act  of 1923 read with s. 386 bound the State  and  set aside  the order of acquittal and sent the case back to  the Magistrate for disposal according to law. The  most  important question thus is, whether the  rule  of construction  derived from the royal prerogative in  England can still be said to apply in India after January 26,  1950. If this rule of construction based on the royal  prerogative does  not  apply,  it  would  necessarily  follow  that  the ordinary rule of construction, namely, that the State  would also  be  bound by the law like anybody else  unless  it  is expressly  excluded  or excluded by  necessary  implication, would  apply.   Now the rule of construction  based  on  the royal prerogative is a survival from the medieval theory  of divine right of Kings and the conception that the  sovereign was absolutely perfect, with the result that the common  law of England evolved the maxim that " the King can do no wrong ".  In  course  of time however  the  royal  prerogative  in England  was  held to have been created and limited  by  the common  law and the sovereign could claim  no  prerogatives, except such as the law allowed nor such as were contrary  to Magna Carta or any other statute or to the liberties of  the subject.   The courts also had jurisdiction to inquire  into the existence or extent of any alleged prerogative.  If  any prerogative  was disputed, they had to decide  the  question whether  or not it existed in the same way as  they  decided any other question of law.  If a, (1)  (1946) L.R. 73 I.A. 271. 184 prerogative  was  clearly established, they could  take  the same judicial notice of it as they took of any other rule of law:  (see Halsbury’s Laws of England, 3rd Edition, Vol.  7, p. 221, para. 464). The  question  of royal prerogative was also  considered  in Attorney-General v. De Keyser’s Royal Hotel Limited(1).   It

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was  held there in that even where there was prerogative  it could  be curtailed by a statute, if the statute dealt  with something   which  before  it  could  be  affected  by   the prerogative, inasmuch as the Crown was a party to every  Act of Parliament.  Thus in modern times, the royal  prerogative is the residue of discretionary or arbitrary authority which at any time is legally left in the hands of the Crown and is recognised under the common law of England.  Two things  are clear  from  this modern conception  of  royal  prerogative, namely,  (1) that there must be a Crown or King to whom  the royal  prerogative  attaches, and (2) that  the  prerogative must  be  part  of the common law of  England.   Both  these conditions  existed  when  the  Privy  Council  decision  in Province  of Bombay v. Municipal Corporation of the City  of Bombay  (2)  was given in October 1946; the King  was  still there and the Privy Council held that the English common law rule  of construction applied to Indian legislation as  much as  to  English  statutes.  I may mention  however  that  in England  also the rule has come in for criticism by  writers of books on law.  Glanville L. Williams in his treatise on " Crown Proceedings " says at p. 53: "  The rule originated in the Middle Ages, when  it  perhaps had  some justification.  Its survival, however, is  due  to little but the Vis inertiae." Again at 54, the author says- "  With the great extension in the activities of  the  State and  the  number of servants employed by it,  and  with  the modern  idea,  expressed  in  the  Crown  Proceedings  Act," (compare in this connection Art. 300 of our Constitution), " that the State should be accountable in wide measure to  the law,  the  presumption should be that a  statute  binds  the Crown rather than it does not." (1) [1920] A.C. 508.       (2) (1946) L.R. 73 I.A. 271. 185 After January 26, 1950, when our country became a democratic republic  and the King ceased to exist, it is rather  otiose to  talk  of  the royal prerogative.  It  is  also  well  to remember  that the English common law as such never  applied to India, except in the territories covered by the  original side  of the three Chartered High Courts, namely,  Calcutta, Bombay  and Madras, (see Kahirodebihari Datta v.  Mangobinda Panda(1) ) though sometimes rules of English common law were applied  by Indian courts on grounds of justice, equity  and good conscience.  It seems to me therefore that to apply  to Indian   statutes   a  construction  based  on   the   royal prerogative  as known to the common law of England now  when there is no Crown in this country and when the common law of England was generally not even applicable, (except in a very small  part),  would  be  doing  violence  to  the  ordinary principle  of  construction of statutes, namely,  that  only those  are not bound by a statute who are  either  expressly exempted  or  must  be  held  to  be  exempt  by   necessary implication. In our country the Rule of Law prevails and our Constitution has  guaranteed it by the provisions contained in  Pt.   III thereof as well as by other provisions in other Parts:  (see Virendra Singh and others v. The State of Uttar Pradesh  (2) ).  It is to my mind inherent in the conception of the  Rule of Law that the State, no less than its citizens and others, is  bound  by the laws of the land.  When the  King  as  the embodiment of all power-executive, legislative and judicial- has   disappeared  and  in  our   republican   Constitution, sovereign  power has been distributed among  various  organs created  thereby,  it  seems to me  that  there  is  neither justification  nor  necessity  for continuing  the  rule  of

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construction  based  on the royal prerogative.  It  is  said that though the King has gone, sovereignty still exists  and therefore  what was the prerogative of the King  has  become the  prerogative  of the sovereign.  There is to my  mind  a misconception here.  It is true that sovereignty must  exist under our Constitution (1)  (1934) I.L.R. 61 Cal. 841, 857. (2) (1955) 1.S.C.R. 415. 186 but there is no sovereign as such now.  In England, however, the  King is synonymous with the sovereign and so arose  the royal   prerogative.   But  in  our  country  it  would   be impossible now to point to one person or institution and  to say  that he or it is the sovereign under the  Constitution. A  further  question  may arise, if one is in  search  of  a sovereign  now, whether the State Government with which  one is  concerned  here is sovereign in the same  sense  as  the English  King (though it may have plenary powers  under  the limits  .set  under our Constitution).  This to my  mind  is another reason why there being no King or sovereign as  such now  in our country, the rule of construction based  on  the royal prerogative can no longer be invoked. Reliance was placed in this connection on certain cases from Australia  and  Canada and also from the  United  States  of America.  So far as Australia and Canada are concerned,  the cases are not of much help for the Crown exists there still. Besides in Canada and in most of the provinces of Canada and in New Zealand provisions have been specifically  introduced in the Interpretation Acts laying down that no provision  or enactment in any Act shall affect, in any manner whatsoever, the  rights of His Majesty, his heirs or successors,  unless it  is expressly stated ’therein that His Majesty  shall  be bound  thereby: (see Street on Governmental Liability ",  at p. 152). In  the  United  States also, it is doubtful  if  the  royal prerogative  as  such is relied on as the basis  of  certain principles  which are in force there.  In United  States  of America  v.  United Mine Workers of America, Etc.  (1),  the Supreme  Court did say that there was an old and  well-known rule  that  statutes which in general  terms  divested  pre- existing  rights and privileges would not be applied to  the sovereign  without express words to that effect.  But  there was  no discussion of the royal prerogative as such  in  the judgment and the rule was called a well-established rule  of construction  only.  Besides the Court went on  to  consider the words of the statutes under consideration and held  that on  a proper construction of them the United States was  not bound. (1)  (1947) 330 U.S, 258: 91 L. Ed. 884 187 In  United States of America v. Reginald P. Wittek (1),  the Supreme  Court  did  say that  a  general  statute  imposing restrictions does not impose them upon the government itself without  a clear expression or implication to  that  effect; but this decision was based mainly on the terms of the State statute  there  under  consideration  and  the   surrounding circumstances   and  legislative  history  of  the   statute concerned.   Another case in the same volume is Jess  Larson v. Domestic and Foreign Commerce Corporation (2) at p. 1628, where  a suit was brought against an officer of  the  United States  and  it  was held that it was in  substance  a  suit against the sovereign government over which the court in the absence  of  consent  had  no  jurisdiction.   There  is  no discussion  in  this case of the  royal  prerogative  having continued  in  the United States and the decision  seems  to

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have turned on some law of that country which provides  that a suit against the Government could not be tried in a  court in the absence of consent.  As against these decisions I may refer  to H. Snowden Marshall v. People of the State of  New York  (3) to show that royal prerogative as such  is  losing ground in the United States, if nothing more.  When  dealing with the priority of a State over the unsecured creditors in payment  of  debts  out of the assets  of  the  debtor,  the Supreme   Court  held  that  whether  the  priority  was   a prerogative right or merely a right of administration was  a matter of local law and the decision of the highest court of the State as to the existence of the right and its incidents would   be  accepted  by  the  Federal  Supreme   Court   as conclusive.  Again in Guaranty Trust Company of New York  v. United  States of America (4), the Supreme Court  held  that the immunity of the sovereign from the operation of statutes of  limitation,  although  originally  a  matter  of   royal prerogative,  was  now  based  upon  the  public  policy  of protecting the citizens of the State from the loss of  their public rights and revenues through the (1) (1949) 337 U.S. 34693 L. Ed. 1406. (2) (1949) 337 U.S. 68293 L. Ed. 1628. (3) (1920) 254 U.S. 38o65 L. Ed. 315. (4) (1938) 304 U.S. 126: 82 L. Ed. 1224. 188 negligence  of the officers of the State, showing that  some of  those immunities which in England were claimed as  royal prerogatives, though preserved in the United States, were so preserved  for  other  reasons.   Besides  it  must  not  be forgotten  that though the Crown no longer remained  in  the United,  States  after the attainment  of  independence  the American colonies out of which the United States arose  were colonised by English settlers who carried the common law  of England with them to America with the result that the  first Constitution  of  some of the States (like New  York)  after independence  provided that the common law of England  which together with the statutes constituted the law of the colony before independence should be and continue to be the law  of the  State  subject to such alterations as  its  legislature might  thereafter make: (see H. Snowden Marshall v.  People, of  the State of New York(’), at p. 317).  That may  account for the United States recognising some of those  prerogative rights  which were in force in England; though even so,  the basis  for  such recognition is now more the law  or  public policy than any royal prerogative as such.  The position  in our country was somewhat different.  We had the King but the common  law of England did not, as already indicated,  apply as a rule in this country.  Now that the King has also gone, there  seems  to  be  no reason  for  continuing  the  royal prerogatives after January 26, 1950. Further it appears to me that the royal prerogative where it deals  with substantive rights of the Crown as  against  its subjects, as, for example, the priority of Crown debts  over debts  of the same nature owing to the subject, stands on  a different footing from the royal prerogative put forward  in the  present  case, which is really no more than a  rule  of construction  of statutes passed by Parliament.  Where,  for example,  a  royal prerogative dealing  with  a  substantive right  has  been  accepted  by  the,  Courts  in  India   as applicable  here also, it becomes a law in force which  will continue  in  force under Art. 372(1) of  the  Constitution. But (1)  (1920) 254 U.S. 380; 65 L. Ed. 315. 189 where the royal prerogative is merely a rule of construction

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of  statutes based on the existence of the Crown in  England and  for  historical  reasons,  I  fail  to  see  why  in  a democratic  republic,  the  courts  should  not  follow  the ordinary  principle  of construction that no one  is  exempt from the operation of a statute unless the statute expressly grants  the exemption or the exemption arises  by  necessary implication.   On the whole therefore I am of  opinion  that the proper rule of construction which should now be applied, at  any  rate after January 26, 1950, is that the  State  in India whether in the Centre or in the States is bound by the law  unless there is an express exemption in favour  of  the State   or  an  exemption  can  be  inferred  by   necessary implication.   The view taken by the Calcutta High Court  in this connection should be accepted and the view expressed by the  Privy  Council  in  Province  of  Bombay  v.  Municipal Corporation  of the City of Bombay (1) should no  longer  be accepted as the rule for construction of statutes passed  by Indian legislatures. Let me then come to the question whether on the view I  have taken  of the rule of construction, the prosecution in  this case  can be allowed to continue.  There is nothing  in  the Act  of  1923  or in the Act of  1951  exempting  the  State specifically  from  any of the provisions  of  the  Calcutta Municipal  Act.  In this case the State is being  prosecuted under  s. 488 (or s. 537 now) and that section provides  for fine for breach of s. 386 (or s. 437 now).  The provision is a penal provision’ and immediately a question arises whether the  State  as such, apart from its individual  officers  as natural persons, is liable to prosecution under the criminal law  or  has  to  be exempted  from  the  operation  of  the provisions of criminal statutes by necessary implication.  A criminal proceeding generally ends with punishment which may be imprisonment, or fine, or both.  Now it does not  require any  elaborate  reason  to realise that the  State  as  such cannot be sentenced to imprisonment because there is no  way of (1)  (1946) L.R. 73 I.A. 271. 190 keeping  it in prison; therefore, by necessary  implication, the  State is exempt from all penal statutes and  provisions providing for sentences of imprisonment or death.  Then come those penal provisions which impose fines, like the  present case,  and the question is whether in such a case  also  the State  must be deemed by necessary implication to be  exempt from  the  penal provision.  Generally speaking  fines  when inflicted by courts are realised by the State and go to  the coffers of the State.  In effect, therefore if the State  as such is to be prosecuted under a penal statute imposing fine the result is that the Court will sentence the State to fine which  will go to the State itself.  It is obvious  that  if such is the result of a prosecution, namely that the accused gets  the  fine, the intention could never be  that  such  a prosecution should be launched.  Therefore where the penalty is fine and the fine goes to the State, it must be held that by  necessary implication the law does not intend the  State to be prosecuted for such an offence.  In the present case I find  that  under s. 81 of the Act of 1923 (or  the  corres- ponding s. 115 of the Act of 1951) the fines imposed by  the Magistrate  will not go to the Corporation but in the  usual way  to the State.  Under the circumstances  whatever  other methods  may be possible for enforcing the provisions of  s. 386 (or s. 437 now) against the State it cannot be  intended to be enforced by prosecution resulting in fine which  would go  to the State itself.  In these circumstances it must  be held that by necessary implication the State is exempt  from

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the  penal provisions contained in s. 488 (now s.  537).   I would therefore allow the appeal, set aside the judgment  of the  High  Court and restore the order of acquittal  by  the Magistrate.                                         Appeal allowed. 191