07 August 2000
Supreme Court
Download

GOVT. OF A P Vs G.V.K. GIRLS HIGH SCHOOL

Bench: M.J.RAO K.G BALAKRISHNANA
Case number: C.A. No.-002422-002422 / 1997
Diary number: 76958 / 1996
Advocates: ANIL KUMAR TANDALE Vs B. KANTA RAO


1

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 21  

CASE NO.: Appeal (civil) 2422  of  1997

PETITIONER: GOVT.  OF ANDHRA PRADESH AND ORS

       Vs.

RESPONDENT: G.V.K.  GIRLS HIGH SCHOOL

DATE OF JUDGMENT:       08/08/2000

BENCH: M.J.Rao K.G Balakrishnana

JUDGMENT:

L.....I.........T.......T.......T.......T.......T.......T..J

     J U D G M E N T

     M.  JAGANNADHA RAO, J.

     This is an appeal by the State of Andhra Pradesh

     against the judgment of the Division Bench of the High

     Court  of  Andhra Pradesh in Writ Appeal No.  1745  of 1995

     dated 6.8.1996 affirming the judgment of the learned

     Single Judge of that Court in Writ petition 15879/90

     dated 27.7.1995.

     The following are the facts:

     The respondent-school was admitted to grant-in-aid

2

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 21  

     in GO.347 (Ed.) dated 1.8.86 w.e.f.  1.9.85 to 29.2.86

     under AP.Act I/82.  On the ground that there were some

     complaints   against  various    schools,   Government appointed

     a  Committee on 24.2.88 under GO.220 and this was made a

     statutory Committee by Andhra Pradesh Act 22/88.  The

     Committee cleared the respondent-School but still the

     arrears for the period 1.9.85 to 31.10.89 for the Head

     Mistress  and  from 1.3.86 to 31.10.89 for  the  staff were

     not paid.  Hence, the present writ petition was filed.

     After the Writ petition was filed, GO.138 (Ed.) dated

     25.4.94 was issued refusing to pay these arrears.

     The learned Single Judge allowed the Writ petition

     holding that the respondent- school was entitled to

     payment of ’arrears’ of grant-in-aid and quashed

     G.O.No.138 dated 25.4.94.  Then the State came forward

     with a legislation,- after the said judgment, - by way

     of Andhra Pradesh Act 34/95 (published in the Gazette

     on 20.9.95) with retrospective effect from 17.10.89

     which permitted denial of ’arrears’ of grant-in-aid

     whenever   such  arrears  were   claimed  under   "any judgment,

     decree or order of Court or other authority or any

     order issued by Government".  In the Writ Appeal, the

     State relied upon the said legislation to get over the

     judgment dated 27.7.95 of the learned Single Judge

     directing arrears of grant-in-aid to be paid but the

     Division Bench held that the legislature could not set

     aside  the  judgment of the High Court by  Act  34/95. The

     judgment was confirmed and the Writ Appeal was

     dismissed.  It is against the said judgment that this

     appeal is preferred by the State.  During the pendency

3

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 21  

of

     this  appeal  stay  of  the  High  Court’s  order  was refused.

     For appreciating the points raised in this appeal,

     it  is  necessary  to refer to the provisions  of  the three

     statutes  and  the various government  orders  dealing with

     grant-in-aid to schools in the State of Andhra Pradesh

     chronologically in so far as they are relevant for the

     case before us.

     Andhra Pradesh Act 1/82

     The Andhra Pradesh Education Act ( A.P.  Act I of

     1982)  deals  with  ’grant-in-aid’   Chapter  VIII   ( sections

     42  to  47).   Section 42 states that  the  Government shall,

     within  the limits of its economic capacity, set apart a

     sum  of money annually for being given as grant-in-aid to

     local  authority  and private institutions  recognised for

     the aforesaid purpose.  Section 43 deals with the

     authorities which may sanction the grant, ( section 44

     has been omitted in 1983), section 45 deals with the

     manner  of  submitting  applications for  sanction  of grant

     and the conditions to be fulfilled on such sanction.

     Sub-clause (1) of section 46 gives power to Government

     to withhold, reduce or withdraw grant, notwithstanding

     anything in the Chapter, on inquiry, (i) on the ground

     of non-availability of funds or (ii) because of the

     conduct and efficiency and the financial condition of

     such institution.  The section provides opportunity to be

4

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 21  

     given.   Sub-clause  (2)  of section 46  states  that, without

     prejudice to the generality of the provisions of sub-

     section (1) or any other provisions of the Act, the

     Government may, after making necessary inquiry,

     withhold,   reduce  or  withdraw   any  grant  if  the management

     of the Institution is guilty of various acts specified

     in  the sub-clause.  Section 47 deals with the  manner of

     utilisation of funds and movable property of private

     institution.

     GO.238 (Ed).dated 27.5.86 and GO.347 (Ed.)dated 1.8.86

     Government issued G.O.238(Ed.) dated 27.5.86

     stating  that all schools which were validly opened on or

     after 1.4.1977 and which had completed 5 years in

     respect of boys’ schools and 3 years in respect of

     girls’   schools   etc.   are  to   be   admitted   to grant-in-aid.

     As already stated, the respondent-school was admitted

     to grant-in-aid as per G.O.347 (Ed.) dated 1.8.86 with

     effect  from  1.9.85  to 29.2.86 as permitted  by  Act I/82.

     Complaints   and  GO.220   dated  24.2.88   appointing Committee.

     On 24.2.88, Government issued G.O.  220 stating

     that   Government  had   received  various  complaints against

     several schools which were receiving grant-in-aid even

     though they did not satisfy the necessary conditions.

     It was further stated that the Government had,

     therefore, constituted a High Level Committee in G.O.

     Rt.No.220 (Ed.) dated 24.2.88 to look into every case

     of grant-in-aid and make specific recommendations.

5

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 21  

     Andhra  Pradesh  Act  22/88:  Statutory  Committee  to inquire into complaints:

     Soon after 24.2.88, the Government felt that a GO

     was not sufficient to enable the making of inquiries

     into  complaints  and that legislation was  necessary. It,

     therefore,came forward with the Andhra Pradesh Private

     Educational  Institutions   Grant-in-Aid  (Regulation) Act,

     1988(AP Act 22 of 1988) which was published in the

     Gazette on 29.8.88 and under sub-clause (3) of Section 1

     this  Act was given effect from 22.7.1985.  Section  3 of

     the Act reads as follows:

     "Section 3(1):  Regulation of grant- in-aid to private educational institutions:

     Notwithstanding anything contained in G.O.  Ms.No.238, Education  (SSE)  Department, dated the 27th May,  1986  and GO.Ms.   No.424,  Education (CE) Department, dated the  19th September, 1985, -

     (a)  no  private educational institution other than  a college  established after the Ist April, 1977 land existing on   the  Ist  September,  1985   and  no  private   college established  after  the Ist April, 1977 and existing on  the Ist  March,  1985  shall be entitled to receive  any  grant- in-aid  unless  the Committee constituted  in  GO.Rt.No.220, Education  (SSE-I) Department, dated the 24th February, 1988 recommends that it may be admitted to grant-in-aid;  and

     (b)  no  private educational institution other than  a College  which has been established after the Ist September, 1985 and no private college which has been established after the  Ist March, 1985 shall be entitled to receive any grant- in-aid.

     (2)  A private educational institution referred to  in clause  (a)  of  sub-section  (1) in  favour  of  which  the Committee  recommends  the release of grant-in-aid shall  be entitled  to such grant only from the date it satisfies  all the  conditions  for admission to grant-in-aid specified  in the  Andhra  Pradesh Education Act, 1982 and the Rules  made thereunder,  the grants-in-aid Code and the orders and other instructions  issued by the Government from time to time  in this behalf."

     Section 4 of the Act refers to release of grant-

     in-aid in respect of certain additional sections and

6

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 21  

     posts.    Section  5  refers  to  seeking  refund   of grant-in-

     aid if the Committee in G.O.220(ed.) dated 24.2.88

     determines that the institution wrongly received aid.

     Section   6   said   the    Act   will   have   effect notwithstanding

     anything  in  any law, judgment etc.  Section 7  deals with

     validation.  Section 8 repeals the Ordinance of 1988.

     GO.124  (Ed.)  dated  27.1.89  &  GO.326  (Ed.)  dated 17.10.89:   The Committee rejects complaints against several schools including respondent-School:

     Under a G.O.  124 (Ed.) dated 27.1.89 a Committee

     was constituted as stated in the above Act 22/88.  It

     appears that the Committee met and conducted inquiries

     into  complaints  and  gave  various  recommendations. G.O.

     326 (Ed.) dated 17.10.89 was thereafter issued stating

     that   the  Committee  had   recommended  release   of grant-in-

     aid to 59 secondary schools and other specified

     elementary, oriental schools, sections whose names are

     enumerated in the Annexure - "subject to various

     conditions" (i) to (vi) and that Rs.63 lakhs was being

     sanctioned to these schools enumerated in the Annexure

     to this G.O.  for the period 1.11.89 to 29.2.90.  But

     para  12  of  the  GO.  is  important  and  stated  as follows:

     "Regarding  payment  of  arrears to  the  schools  now admitted to grant-in-aid, orders will be issued separately."

     A point has been raised as to whether this para is an

     admission  that arrears are due and will be paid.   As to

     the  meaning  of  the word ’now’ used in  this  order, there

7

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 21  

     is again some controversy and we shall explain it a

     little later.

     The  Writ  petition for arrears and the  GO.138  (Ed.) dated 25.4.94 refusing arrears:

     As the arrears of grant-in-aid were not released,

     the Ist respondent filed W.P.15879/90, seeking release

     of  the arrears for the period 1.9.85 to 31.10.89  for the

     Headmistress and for 1.3.86 to 31.10.89 for the other

     staff.

     As already stated, during the pendency of the Writ

     petition  Government  issued a specific  order  GO.138 (Ed.)

     dated  25.4.94  refusing to pay the arrears.   In  the said

     GO,  Government  referred  to para 12  of  GO.326(Ed.) dated

     17.10.89 as set out above and said that in that para

     Government had not made any commitment to pay arrears.

     It stated:

     "It  will be seen from the Government Order cited that the  Government  have not made any specific commitment  with regard to the arrears."

     Government  then said that after examining the  matter in

     detail in the light of "the right of the schools for

     grant-in-aid or arrears therein" and also the ’present

     financial position’ of the State Government and taking

     into account the fact that there will be the extra

     expense  of  about  4.5 crores, if arrears are  to  be paid,

     the  Government  decided  "not   pay  arrears".    The validity

     of this GO was, therefore, gone into by the learned

     Single Judge.

8

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 21  

     Learned Single Judge directs arrears to be paid:

     Before the learned Single Judge, apart from

     relying on sections 42 to 45 of AP Act 1/82 and the

     retrospectivity given to AP Act 22/88, and the various

     GOs, the respondent school relied also upon the above

     para 12 to contend that the entitlement of the schools

     for arrears prior to 17.10.89 was re-affirmed in this

     GO.326 but that what the GO meant in para 12 was that

     the further order contemplated therein was only for

     working  out the mode of payment.  The Government,  on the

     other hand, contended before the learned Single Judge

     that  in  this  para  12  of  GO  326  Government  had identified

     these schools as eligible to receive grant-in-aid

     ’afresh’ and it was not a case of re-affirmation of a

     previous eligibility.  Of course, question is whether

     this  contention of the Government can fit into the GO if

     para    12    refers   to    payment    of    arrears. Respondent-school

     contends that if it was a fresh admission to grant-in-

     aid, there was indeed no need at all to refer to any

     arrears.  We shall revert to this aspect again.

     The learned Single Judge had, therefore, to go

     into the validity of GO 138 dated 25.4.94 denying

     arrears.  (By that date Ap Act 34/95 had not been

     passed).   The learned Judge allowed the Writ petition on

     27.7.1995 and directed payment of arrears and declared

     GO.138(Ed.) dated 25.4.94 as inoperative, stating that

     under sections 42, 43 and 45 of the Act 1/82, the

     statute conferred a right to receive the grant-in-aid

     and that initially grant-in-aid was released in favour

9

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 21  

     of the petitioner for the period 1.9.85 to 26.2.86 as

     stated in GO.347 (Ed.) dated 1.8.86, that later on in

     view of complaints against various schools, Government

     appointed a Committee in GO.220 dated 24.2.1988, the

     Committee  cleared  the case of the  writ  petitioner, along

     with other schools in GO.326 dated 17.10.89 and while

     the Committee was inquiring into the matter, the right

     to ’arrears’ remained in abeyance till the writ

     petitioner was cleared by the Committee, that once the

     favourable  recommendation by the Committee was given, it

     was  nothing  but  a retro-active declaration  of  the right

     to  receive  the grant-in-aid from  29.2.86.   Learned Judge

     also  held  that  in  para 12 of the  GO.   326  dated 17.10.89,

     the Government had agreed to pay the arrears and,

     therefore, they could not have issued GO.138 dated

     25.4.94 refusing to release the arrears because of

     ’present  financial  position’ ( i.e.  in 1994).   The writ

     petition was allowed.

     Act  34/95  says  arrears  need not  be  paid  as  per judgment or Government order:

     We have already stated that after the above

     judgment of the learned Single Judge, the Legislature

     passed   Andhra  Pradesh    Educational   Institutions Grant-in-

     Aid  (Regulation)  Supplementary Provision  Act,  1995 (Act

     34/95).   It was published in the Gazette on  20.9.95. It

     was given retrospective effect from 17.10.89.  It

10

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 21  

     contains only two sections.  There is a long preamble

     setting out the gist of the various GOs.set out above.

     Section 1 deals with retrospectively and section 2 of

     this Act, declares that arrears payable by virtue of

     "any judgment or decree of Court or other authority or

     any  order issued by Government" need not be paid even if

     it had become payable to the schools enumerated in GO

     326  dated  17.10.89 read with Go 178 dated  23.07.90. We

     have extracted section 2 lower down in this judgment.

     Division Bench says Act 34/95 cannot overrule judgment of learned Single Judge:

     It was this Act 34/95 that was relied upon by the

     Government  before  the  Division Bench  in  the  Writ Appeal

     to deny the arrears.  The Division Bench, as already

     stated,  held  that once the rights of the  respondent for

     release of grant-in-aid got crystallised by way of a

     judgment, the Legislature could not have set aside the

     judgment    by   passing   a   law   and    therefore, notwithstanding

     the  new  law,  the  State was  bound  to  honour  the judgment

     of the learned Single Judge.  The Writ Appeal was

     dismissed.  However, the Bench did not go into the

     question whether Act 34/95 removed the basis of the

     judgment   of   the   learned    Single   Judge   with retrospective

     effect.

     Points arising in this appeal:

     In this appeal, we have heard learned Senior

     counsel for the State of Andhra Pradesh Smt.

     K.Amareswari  and  learned counsel for the  respondent

11

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 21  

Sri

     B.  Kanta Rao.

     The following points arise for consideration:

     (1) whether the State can successfully rely on A.P.Act

     34/95  to  deny  the arrears of  grant-in-aid  if  the arrears

     had become payable under Act 1/82 and Act 22/88, and

     once  the  Committee  appointed under  Act  22/88  had cleared

     the school?

     (2) Whether, in the facts of the case, the arrears of

     the grant-in-aid could be denied by Legislation even

     after  the  right  to  the same was  declared  by  the learned

     Single Judge of the High Court?

     Point 1:

     We have noticed that the period for which the

     dispute between the parties survives is regarding

     arrears  for the period from 1.9.85 to 31.10.89 so far as

     the post of Head-Mistress of this school is concerned

     and for 1.3.86 to 31.10.89 so far as the staff is

     concerned.

     We shall first refer to the effect of Act I/82 on

     the facts of this case.  Section 42 to 45 of Act 1/82

     contain  the  main  provisions  as  to  admission   to grant-in-

     aid.  In other words, in respect of the schools which

     satisfy the prescribed eligibility conditions as

     prescribed in the GOs, a statutory right to receive

     grant-in-aid  is clearly created by sections 42 to  45 of

     the said Act.

     No doubt, section 46 of Act 1/1982 permits

12

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 21  

     withholding   or  reduction  or   withdrawal  of   the grant-in-

     aid.  We have already referred to the gist of this

     provision but now we shall extract the same:

     "S.46--Power  of  Government  to withhold,  reduce  or withdraw grant:--

     (1)  Notwithstanding  anything  in this  Chapter,  the Government  may,  after such enquiry as they may  deem  fit, withhold,  reduce  or  withdraw  any  grant  payable  to  an educational  institution  having regard to the funds at  the disposal of the Government or the conduct and efficiency and the financial condition of such institution, after giving an opportunity  to the manager of the institution concerned  of making  a representation against such withholding, reduction or withdrawal.

     (2)  Without  prejudice  to   the  generality  of  the provisions of sub-section (1) or any other provision of this Act, the Government may, after such enquiry as they may deem fit,  withhold, reduce or withdraw any grant payable to  any educational  institution  if the manager of the  institution concerned,--

     (i) fails to fulfil or any of the conditions of grant;

     (ii)  denies admission to any citizen on grounds  only of religion, race, caste, language or any of them;

     (iii)  allows any employee of the institution to  take part  in any agitation intended to bring or attempt to bring into hatred or contempt, or intended to excite or attempt to excite  disaffection towards, the Government established  by law in India;

     (iv)  directly or indirectly encourages any propaganda or  practice of wounding the religious feelings of any class of  citizens  of  India  or insulting the  religion  or  the religious beliefs of that class;

     (v) is guilty of falsification of registers, of misuse of  funds  for purposes other than those for which they  are collected;

     (vi)  fails  to remedy within such reasonable time  as may  be specified by the competent authority, the defects in the maintenance of accounts pointed out by the auditors;  or

     (vii)  fails to restore, within the time specified  by the  competent  authority, an employee whose  services  have been  wrongfully  dispensed  with or fails to  pay  him  any arrears  of salary or other benefits when directed to do  so by the competent authority.

     (3) Subject to the other provisions of this Act, every order passed under this section shall be final and shall not be questioned in any court of law."

     It will be seen that the power mentioned in the first

13

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 13 of 21  

     part of clause (1)(a) could be exercised after inquiry

     by  the  State  having  regard to  the  funds  at  the disposal

     of the Government.  Under the second part of clause

     (1)(a),  this  power  could be  exercised  based  upon conduct

     and   efficiency   or  financial   position   of   the institution

     also after giving opportunity.  Under clause (2) of

     section  46,  the  power  could be  exercised  if  the manager

     had committed certain irregularities as found in an

     inquiry where the manager is heard.  It is clear that

     when Government appointed a Committee to go into

     complaints, it was exercising the option under section

     46(2).   So  far as section 46(1) is concerned,  there are

     no  proceedings  issued  under section  46(1)  and  no inquiry

     conducted under that provision.

     Right to arrears flows from Act 1/82 and Act 22/88 and Committee;s  report  and  is not created by  any  Government orders:

     It is not in dispute that after Act 1/82, the

     respondent-school  was admitted to grant-in-aid  under the

     said  Act  in  GO 347(Ed.) dated  1.8.86  because  the school

     satisfied the conditions in GO 238(Ed.) dated 27.5.86.

     Now, after complaints were received, the grant was

     kept in abeyance and the cases of the respondent and

     others were inquired into under section 46(2).

     Initially,  the Government constituted a Committee  in GO

     220  dated 24.2.88.  Later by Act 22/88, the Committee was

     given statutory status to go into complaints.  It will be

14

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 14 of 21  

     noticed that the right to receive grant-in-aid for the

     back years i.e.  from 22.7.85 was declared under Act

     22/88, contingent upon the recommendation of the

     Committee.   This  is  clear from  section  3(2).   It states

     that if the Committee recommends favourably, then the

     grant is to be released in favour of an institution,

     "from the date upon which it satisfies all the

     conditions for admission to grant in aid specified in

     the Andhra Pradesh Education Act, 1982 and the Rules

     made thereunder, or the grant in aid code or orders or

     other  instructions issued by the Government from time to

     time".  This clause, in our view, therefore directs

     release of grant-in-aid from the date upon which the

     school  satisfies  the   eligibility  conditions.   As already

     stated sub-clause (3) of section 1 made Act 22/88

     retrospective from 22.7.85.  Hence it is as if the

     Committee constituted under Act 22/88 was there from

     1985.  In our view, once the Committee gave its

     clearance, the decision would therefore be effective

     from 22.7.1985 in respect of all the back years from

     dates anterior to the passing of Act 22/88, and the

     school  would  be entitled to release of  grant-in-aid from

     the date on which it satisfies the conditions for

     receiving grant-in-aid.

     It is contended for the State of Andhra Pradesh

     that section 3(2) is only prospective.  It is true

     section   3   does   not   expressly  say   that   the recommendation

     will be retro-active but from the language of section

     3(2)  referred to above and also because sub-section 3 of

15

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 15 of 21  

     section  1  says that the Act "be deemed to have  come into

     force  on the 22nd July, 1985", in our view, the right is

     retrospectively affirmed for the back years.  In other

     words,   the   Committee’s   recommendations   as   to compliance

     with conditions during various years from 1985 though

     made  after  1988 were to be treated as  in  existence from

     various dates after 22.7.1985 and if the institution

     satisfied the conditions of the Act 1/1982 and also

     conditions laid down in other GOs in the previous

     years, the Committee’s recommendation in favour of any

     school would be retroactive and will apply to those

     back years.  That the right to arrears is affirmed by

     section  3 is also clear from section 5 which  relates to

     an adverse recommendation of the Committee.  In cases

     where the Committee accepted complaints, section 5

     requires refund of amounts already paid.  Thus, Act

     22/88 provided for payment of arrears or for refund of

     amounts paid.  That was the purpose in making the

     provisions   of   that    Act   retrospective   w.e.f. 22.7.1985.

     In our view, these provisions of the Act, therefore,

     clearly conferred a statutory right on the writ

     petitioners to receive the grant-in-aid right from

     22.7.85 onwards in the various years in which they

     satisfied the conditions.  The right to arrears thus

     flows from the statutes and the Committee’s

     recommendations  and  not from any Government  orders. In

     other  words, the basic right to receive arrears  does not

     stem  from  any  Government order in  respect  of  the schools

16

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 16 of 21  

     enumerated in GO 326(Ed.) dated 17.10.89 read with GO

     178(Ed.) dated 23.7.90.  The right stems from Act 1/82

     and Act 22/88 and the findings of the Committee.  This

     aspect becomes important when we come to deal with Act

     34/95  and  as to whether it has removed the basis  of the

     judgment of the learned Single Judge.

     We next come to para 12 of Go 326 dated 17.10.89.

     This GO contained a list of 59 schools like the

     respondent  wherein  it was stated that the  Committee had

     given favourable recommendation in favour of the writ

     petitioner and other institutions.  The GO stated that

     these institutions would be entitled for release of

     grant-in-aid w.e.f.  1.11.89 to 29.2.90 for the year

     1989-90.  It, however, contained a note in para 12 as

     follows:

     "Regarding  payment  of  arrears  to  the  school  now admitted to grant-in-aid, orders will be issued separately."

     In our view, the word "now" used in this GO does not

     mean that these schools are identified as entitled to

     grant-in-aid  for  the first time in 1989 in  this  GO 326.

     This is clear from the fact that like section 3 of Act

     22/88, this GO also speaks of arrears.  If indeed the

     previous orders relating to admission to grant-in-aid

     were intended to be given a go bye as contended before

     us for the State, the Government would not have

     referred to the question of payment of arrears in this

     GO  326.   Therefore, the word "now" in our  view,  is used

     only to identify those schools etc referred to in

     Annexure to the GO.326 and as cleared by the Committee

     and was not intended to create a new prospective right

17

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 17 of 21  

     to receive grant-in-aid after 1989.  Such

     identification would therefore clearly relate back to

     22.7.85 which was the date from which Act 22/88 became

     retrospective.

     Act 22/95:  does not retrospectively remove the rights created  by  Act  1/82  read with Act 22/88  read  with  the recommendation:

     Now we shall finally come to section 2 of Act

     34/95.  The said Act was published in Gazette on

     20.9.1995 after the judgment of the learned Single

     Judge.  But it came into force from 17.10.89, the date of

     GO  326  which  said in para 12 that  the  orders  for arrears

     would be passed separately.  Section 2 of this Act of

     1995 reads as follows:

     "Section 2:  No arrears of grant-in- aid payable:

     Notwithstanding  anything  contained in any  judgment, decree  or  order  of any Court or other authority,  or  any order  issued by the Government or any authority subordinate to the Government, no arrears of grant-in-aid shall or shall even  be  deemed  to be payable to any  private  educational institution  admitted to grant-in-aid in pursuance of GO.326 (Ed.)  dated 17.10.89 and GO.No.178 (Ed.) dated 23.7.90  for the  period  between Ist September, 1985 and  31st  October, 1989 and accordingly:-

     (a) no suit or other proceeding shall be maintained or continued in any Court against the Government or an;y person or  authority  whatsoever for the payment of any arrears  of grant-in-aid for the said period;  and

     (b)  no  Court  shall  enforce  any  decree  or  order directing the payment of any arrears of grant-in-aid."

     The opening part of section 2 refer to the judgment or

     decree  or order of any Court.  The second part  deals with

     orders  of other authority, or any order of Government or

     Subordinate authority.  The second part deals with

     rights created by Government orders.

18

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 18 of 21  

     We shall first consider the second part of section

     2 as to whether the Act removes retrospectively the

     right created by Act 1/82 and Act 22/88.  For that

     purpose, we come back to the language of section 2 of

     Act 34/95.

     In our view, what is removed by the Act 22/95 is

     the right created by the Government orders and not the

     rights created by Act 1/82 and Act 22/88.  If any

     Government order had conferred any right to the

     institutions  enumerated  in  the Annexure to  GO  326 dated

     17.10.89 read with GO 178 dated 23.7.90, it was only

     those rights that were intended to be removed

     retrospectively by section 2 from 17.10.89.  In other

     words, the legislature while enacting section 2 of Act

     34/95 failed to remove the rights conferred by the

     Principal Act 1/82 and Act 22/88 read with the

     Committee’s  declaratory  findings.  Further, the  Act 34/95

     being retrospective only from 17.10.89, it does not go

     beyond that date into the back years.

     So far as the first part of section 2 read with

     section 46 of Act 1/82, the State has also not placed

     any  material  before  Court to sustain the  order  of denial

     of arrears for want of funds.  What budgetary

     allocations  were  made  in the concerned  years  were never

     placed before Court.  There is also no proof of any

     inquiry as required by the first part of section 46(1)

     of  Act 1/82.  Thus, under the first and second  parts of

     section 2 of Act 34/95, there is no removal of the

19

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 19 of 21  

     statutory  right  created by Act I/82 and  Act  22/88, read

     with the recommendations of the Committee.  Point 1 is

     decided accordingly.

     Point 2:

     Act 22/95 cannot set aside the judgment of the learned Single Judge

     Now section 2 of the Act 34/95 also purports to

     nullify  the  effect  of the judgment of  the  learned Single

     Judge.  It is well settled that the legislature cannot

     overrule a judgment by passing a law to that effect

     unless it removes the basis of the legal rights upon

     which the judgment is based, with retrospective effect

     and   provided   there   is  no   violation   of   any constitutional

     provision    in    such     withdrawal    of    rights retrospectively.

     In the present case, we are not going into the

     question whether any provision of the Constitution is

     violated while passing Act 34/95 denying arrears of

     grant-in-aid retrospectively.  However, in our view,

     inasmuch  as  the rights created by Act 1/82  and  Act 22/88

     read  with  the Committee’s recommendations  have  not been

     nullified by Act 22/95, the judgment of the learned

     Single Judge remains effective.  The basis of the

     judgment has not been removed.  We have already shown

     that  the  rights  flowing  from  the  Acts  were  not touched.

     Only rights flowing from Government orders were taken

     away retrospectively.  It is therefore necessary to

     give effect to the judgment of the learned Single

     Judge.  The writ appeal was rightly dismissed.

20

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 20 of 21  

     For the above reasons, which are somewhat

     different  from  the  reasons given  by  the  Division Bench,

     we  dismiss  this  Civil Appeal.  The arrears  of  the grant-

     in-aid as declared above as per Act I/82 and Act 22/88

     and also as directed by the learned Single Judge shall

     now  be  released  in favour of the  writ  petitioner. There

     will be no order as to costs.

     .................J.  [M.JAGANNADHA RAO]

     NEW  DELHI;   .................J.    August  7,  2000. [K.G.BALAKRISHNAN]

     IN THE SUPREME COURT OF INDIA

     CIVIL APPELLATE JURISDICTION

     CIVIL APPEAL NO.  2422 OF 1997

21

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 21 of 21  

     Govt.  of Andhra Pradesh & Others ..Appellants

     Versus

     G.V.K.Girls High School ..Respondent

     ----

     Dear Brother Sri Balakrishnan,

     Draft Judgment in the above-mentioned matter is

     sent herewith for your kind consideration please.

     With regards,