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CASE NO.: Appeal (civil)  5895 of 2004

PETITIONER: Shrikant                                                         

RESPONDENT: Vasantrao & Ors.                                            

DATE OF JUDGMENT: 20/01/2006

BENCH: CJI,B. N. Srikrishna & R. V. Raveendran

JUDGMENT: J U D G M E N T

Raveendran J.

       This appeal under section 116-A of the Representation of the  People Act, 1951 [for short the ’Act’] is by the returned candidate  against the judgment dated 31.8.2004 passed by the learned single  Judge of the Bombay High Court in Election Petition No. 1 of 2002  filed by the first respondent herein.  

2.      Notice of Election dated 29.5.2002 was given by the Returning  officer in respect of an election to be held to elect a member to the  Maharashtra Legislative Council from Aurangabad Division  Graduates’ Constituency. As per calendar, the last date for filing  nominations was 5.6.2002, the scrutiny of nomination papers was  taken up on 6.6.2002 and the poll was held on 23.6.2002.  The  appellant, who was one of the candidates, was declared elected on  26.6.2002. On 9.8.2002, the first respondent, one of the rival  candidates, filed Election Petition No. 1/2002 in the High Court of  Bombay, Aurangabad Bench, challenging the election of the  appellant under section 9-A, 98, 100 (1) (a) & (d) and 101(1)(a) of  the Act.  

3.      In the said election petition, the first respondent alleged that  the appellant was a government contractor carrying on business  under the trade name of M/s. Precision Press Fabricon at  Aurangabad. He further alleged that the appellant had entered into  three contracts with the State Government, in the course of his  business for execution of works undertaken by the appropriate  Government, and such contracts were subsisting, on the date of  filing of nomination/scrutiny of the nomination papers/declaration of  result [in June, 2002]. The said contracts were :  

a)      Contract as per work order dated 19.5.1996 issued by  the Executive Engineer, Medium Project Irrigation  Division, Latur, for the work of designing, fabricating,   and erecting the Automatic stilt doors at the canal of  Tawarja Project.  

b)      Contract as per work order dated 31.12.1998 issued by  the Executive Engineer, Maharashtra Jeevan  Pradhikaran, Works Division No.2, Latur, for execution  of the work relating to water supply scheme in ten  villages surrounding Pangaon.  

c)      Contract as per work order dated 12.4.1999 issued by

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the Executive Engineer, Maharashtra Jeevan  Pradhikaran for the work relating to water supply  scheme, Stage-II Taluk Geora, District Beed.  

The first respondent contended that Maharashtra Jeevan  Pradhikaran is part and parcel of the State Government and  therefore, contracts with the said Pradhikaran are in effect contracts  with the State Government. First Respondent contended that as  these three contracts (the first with the State Government and the  other two with Maharashtra Jeevan Pradhikaran) were subsisting in  June, 2002, the appellant was disqualified for being chosen as a  Member of Legislative Council, under section 9A of the Act.  

4.      The appellant did not dispute that he had entered into such  contracts and that they were subsisting in June, 2002. He, however,  submitted that the correct position in regard to the three contracts  was thus:  

a)      The contract dated 19.5.1996 with the State  Government, stood transferred to "Godawari Marathwada  Irrigation Development Corporation [for short ’GMIDC’],  an authority constituted under the Maharashtra Godawari  Marathwada Irrigation Development Corporation Act  1998 [for short ’MGMIDC Act’] with effect from  1.10.1998.  

b)      Contracts dated 31.12.1998 and 12.4.1999 were entered  into with Maharashtra Jeevan Pradhikaran (for short  ’MJP’),  an authority constituted under the Maharashtra  Jeevan Authority Act, 1976 (for short ’MJA Act’) and not  with the State Government.  

He contended that the question of disqualification under section 9-A  of the Act would arise only if any contract entered into by him [in  the course of his trade or business] with the appropriate  government (State Government) for the supply of goods or for  execution of any works undertaken by that government, subsisted  on the date of filing of nomination/scrutiny of nominations/  declaration of results. He pointed out that the first contract had  been transferred to GMIDC in the year 1998 itself, and the second  and third contracts were with MJP and not with the State  Government. He, therefore, contended that he had no subsisting  contract with the appropriate government in June, 2002 and  therefore, did not suffer disqualification under section 9-A of the  Act.  

5.      After considering the provisions of MGMIDC Act and MJA Act,  the High Court allowed the election petition by order dated  31.8.2004 and declared the election of Appellant as void. It held  that GMIDC and MJP were statutory corporations wholly controlled  by the State Government and therefore, fell within the expression  ’State’ as defined in Article 12 by applying the principles laid down  by this Court in Ramana Dayaram Shetty vs. The International  Airport Authority of India [AIR 1979 SC 1628]; Ajay Hasia Vs. Khalid  Mujib Sehravardi   [1981 (1) SCC 722]; The Mysore Paper Mills Ltd.  Vs. The Mysore Paper Mills Officers Association & Anr. [2002 (2)  SCC 167]; and Pradeep Kumar Biswas vs. Indian Institute of  Chemical Biology & Ors. [2002 (5) SCC 111]. The High Court also  held that GMIDC and MJP being ’State’ under Article 12, they are  the same as being ’State Government’ and therefore, GMIDC and  MJP can be termed as ’appropriate Government’. Consequently, the  High Court held that the Appellant had subsisting contracts with the  appropriate government and therefore, incurred disqualification  under section 9-A of the Act.

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6.      Feeling aggrieved, the appellant has filed this appeal. On the  contentions raised, the following questions arise for consideration:  

i)      Whether a statutory body or authority which answers  the definition of ’State’ under Article 12, for purposes  of Part-III and IV of the Constitution of India, is an  ’appropriate government’ for purposes of section 9-A  of the Act.  

AND

Whether GMIDC and MJP can be termed as  ’appropriate government’ (that is ’State Government’  having regard to definition under section 7 of the Act)  for purposes of section 9-A of the Act.  

ii)     Whether the contract dated 19.5.1996 entered into  by the Appellant with the State Government,  continued to be a contract with the State  Government, after its transfer to GMIDC with effect  from 1.10.1998.  

iii)    Whether the Appellant incurred any disqualification  under section 9-A of the Act, on account of his  contracts dated 19.5.1996, 31.12.1998 and  12.4.1999.

Re : Question  (i)

7.      Article 191 of the Constitution of India prescribes the  disqualifications for a person being chosen as, and for being, a  member of the Legislative Assembly or Legislative Council of a  State. Apart from specifying four grounds of disqualifications, it  provides that a person can be disqualified by or under any law  made by the Parliament. The Representation of the People Act,  1951, a law made by the Parliament, has introduced six  disqualifications for a person being chosen as and for being Member  of Legislative Assembly of Legislative Council of a State under  sections 8, 8-A, 9, 9-A, 10 and 10-A of the Act.  

8.      In Jyoti Basu vs. Debi Ghosal [AIR 1982 SC 983], this  Court clarified that the right to elect, the right to be elected and the  right to dispute an election, though fundamental to democracy, are   neither fundamental rights nor  Common Law Rights, but are pure  and simple statutory rights. This Court held :-

"Outside of statute, there is no right to elect, no right to be  elected and no right to dispute an election. Statutory  creations they are, and therefore, subject to statutory  limitation. An election petition is not an action at Common  Law, nor in equity. It is a statutory proceeding to which  neither the common law nor the principles of equity apply but  only those rules which the statute makes and applies. It is a  special jurisdiction, and a special jurisdiction has always to be  exercised in accordance with the statute creating it. Concepts  familiar to Common Law and Equity must remain strangers to  Election Law unless statutorily embodied. A Court has no right  to resort to them on considerations of alleged policy because  policy in such matters, as those, relating to the trial of  election disputes, is what the statute lays down. In the trial of  election disputes, Court is put in a straight jacket. "

9.      In S. Narayanaswami vs. G. Panneerselvam [AIR 1972 SC  2284], the correctness of a decision of the Madras High Court which

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held that a non-graduate was not qualified to be a candidate for  election to the Graduates’ Constituency, (though the Constitution or  any law made by the Parliament did not prescribe graduation as a  qualification for election to Graduate’s constituency), fell for  consideration of this Court. A Constitution Bench of this Court  reversed the decision of the High Court, on the following reasoning:  

"It could not even be said that qualifications of the electors as  well as of those to be elected were not matters to which the  attention of the law makers, both in the Constituent Assembly  and in Parliament, was not specially directed at all or that the  omission must be by mere oversight. The provisions  discussed above demonstrate amply how legislative attention  was paid to the qualifications of the electors as well as of the  elected in every case. Hence, the correct presumption, in  such a case would be that the omission was deliberate.  

We think that the view contained in the judgment under  appeal, necessarily results in writing some words into or  adding them to the relevant statutory provisions, to the effect  that the candidates from graduates’ constituencies of  Legislative Councils must also possess the qualification to  having graduated. This contravenes the rule of "plain  meaning" or "literal" construction which must ordinarily  prevail. A logical corollary of that rule is that "a statute may  not be extended to meet a case for which provision has  clearly and undoubtedly not been made" (See Craies on  Statute Law \026 6th Edn. P. 70). An application of the rule  necessarily involves that addition to or modification of words  used in statutory provisions is not generally permissible.  

We think that the language as well as the legislative history  of Articles 171 and 173 of the Constitution and Section 6 of  the Representation of People Act, 1951, enable us to presume  a deliberate omission of the qualification that the  representative of the Graduates should also be a graduate. In  our opinion, no absurdity results if we presume such an  intention. We cannot infer as the learned Judge of the Madras  High Court had done, from the mere fact of such an omission  and opinions about a supposed scheme of "functional  representation" underlying Article 171 of our Constitution,  that the omission was either unintentional or that it led to  absurd results. We think that, by adding a condition to be  necessary or implied qualifications of a representative of the  Graduates which the Constitution-makers, or, in any event  the Parliament, could have easily imposed, the learned Judge  had really invaded the legislative sphere. The defect, if any,  in the law could be removed only by law made by  Parliament."

10.     In N. S. Varadachari vs. G. V. Pai [AIR 1973 SC 38], this  Court held thus :-   "Section 8 to 10-A of the Act set out the grounds which  disqualify a person from being a candidate. If a person  possesses all the qualifications prescribed in the  Constitution as well as in the Act and has not incurred any  of the disqualifications mentioned therein then he is  qualified to be a candidate. It may look anomalous that a  non-graduate should be a candidate in a Graduates’  Constituency. But if a candidate possesses the qualifications  prescribed and has not incurred any of the disqualifications  mentioned in the Constitution or in the Act other  consideration becomes irrelevant.

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11.     A person cannot, therefore, be disqualified unless he suffers a  disqualification laid down in Article 191 of the Constitution or under  sections 8, 8-A, 9, 9-A, 10 or 10-A of the Act. It is not possible to  add to or subtract from the disqualifications, either on the ground of  convenience, or on the grounds of equity or logic or perceived  legislative intention. A combined reading of Article 191 of the  Constitution of India and Chapter III of the Representation of the  People Act, 1951 makes it clear that a person can be held to be  disqualified for being chosen as, and for being, a Member of the  Legislative Assembly or Legislative Council of a State only on the  following, and no other, grounds : Disqualifications under the Constitution of India :

i)      If he holds any office of profit under the Government of  India or the Government of any State [specified in the  First Schedule], other than an office declared by the  Legislature of the State by law not to disqualify its holder  \026 vide Article 191 (1) (a);  

ii)     If he is of unsound mind and stands so declared by a  competent court \026 vide Article 191(1) (b);

iii)    If he is an undischarged insolvent \026 vide Article 191(1)  (c);

iv)     If he is not a citizen of India, or has voluntarily acquired  the citizenship of a foreign State, or is under any  acknowledgment of allegiance or adherence to a foreign  State \026 vide Article 191(1)(d);

Disqualifications under the Act :

v)      If he is convicted and sentenced for any offence as  provided/enumerated in Section 8 of the Act;  

vi)     If he is found guilty of corrupt practices by an order  under section 99 of the Act \026 vide section 8-A of the Act;  

vii)    If he is a person who having held an office under the  Government of India or under the Government of any  State has been dismissed for corruption or for disloyalty  of the State \026 vide section 9 of the Act;  

viii)   If he is a person having a subsisting contract with the  State Government for the supply of goods to or for the  execution of any works undertaken by that Government.   \026 vide section 9-A of the Act;

ix)     If he is a person who is a managing agent, manager or  secretary of any company or corporation, in the capital of  which the State Government has not less than twenty- five per cent share \026 vide section 10 of the Act;  

x)      If he is a person who has been declared as disqualified  by the Election Commission for having failed to lodge  account of election expenses within the time and in the  manner required by or the under the Act \026 vide section  10-A of the Act.  

12.     The disqualifications under sections 8 to 10-A of the Act are  clear and very specific. They do not leave any room at ’elbow joints’  to widen or narrow the disqualifications. For example, section 10 of  the Act disqualifies only persons who are working or functioning as  managing agent, manager or secretary of a company or corporation

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in which the State Government has not less than twenty-five per  cent shares, but does not disqualify other employees of such  company or corporation. Section 9 disqualifies a person who had  held an office under the Government of India or any State  Government and who has been dismissed for disloyalty to the State  or for corruption, but it does not disqualify a person who had held  an office under a local or other authority and who has been  dismissed for corruption. Similarly, all and every conviction do not  lead to disqualification under Section 8. The disqualification will be  attracted under section 8 only in cases where (i) the conviction is  followed by sentence of not less than two years; or (ii) the  conviction is for the offences enumerated in sub-section (1); or (iii)  the conviction is in respect of a contravention of a law referred in  sub-section (2) and the sentence is not less than six months.  Section 9-A only disqualifies person having a subsisting contract  with the State Government either for supply of goods or for  execution of any works undertaken by that government, but does  not disqualify persons who have such contracts with any local or  other authority nor disqualifies persons having subsisting contracts  with the State Government if such contracts are not for supply of  goods or for execution of any works undertaken by the State  Government.  

13.     At this juncture, it is of some relevance to notice the  distinction between Articles 102(1)(a) and 191(1)(a) which deal  with disqualification for membership of Houses of Parliament and  the membership of the State Legislative Assembly/Council on the  one hand and Articles 58(2) and 66(4) which deal with  disqualification for election as President and Vice President, on the  other hand. While Article 102 (1)(a) and 191(1)(a) disqualify any  person holding any office of profit under the Government of India or  Government of any State, Articles 58(2) and 66(4) disqualify any  person holding any office of profit under the Government of India or  the Government of any State or under any local or other  authority subject to the control of any of the said  Governments. There is thus a conscious and deliberate omission of  the words ’office of profit under any local or other authority  subjected to the control of any of the said Governments’ while  listing the disqualifications for membership of Houses of Parliament  and membership of Legislative Assembly/Council of a State. Holding  an ’office of profit under local or other authority’ is not a  disqualification for being elected to either house of Parliament or  State Legislative Assembly/Council, but disqualification for being  elected as the President or Vice-President. In Gurushanthappa vs.  Abdul Khuddus [AIR 1969 SC 744], this difference between  disqualification under Article 58(2)/66(4) and Article  102(1)/191(1)(a) was highlighted thus :  

"In this connection, a comparison between Article 58(2) and  66(4) and Articles 102(1) and 191(1) (a) of the Constitution  is of significant help. In Arts. 58(2) and 66(4) dealing with  eligibility for election as President or Vice-President of India,  the Constitution lays down that a person shall not be eligible  for election if he holds any office of profit under the  Government of India or the Government of any State or  under any local or other authority subject to the control of  any of the said Governments. In Articles 102(1)(a) and  191(1)(a) dealing with membership of either House of  Parliament or State Legislature, the disqualification arises  only if the person holds any office of profit under the  Government of India or the Government of any State other  than an office declared by Parliament or State Legislature by  law not to disqualify its holder. Thus, in the case of election  as President or Vice-President, the disqualification arises   even if the candidate is holding an office of profit under a

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local or any other authority under the control of the Central  Government or the State Government, whereas, in the case  of a candidate for election as a Member of any of the  Legislatures, no such disqualification is laid down by the  Constitution if the office of profit is held under a local or any  other authority under the control of the Governments and not  directly under any of the Governments. This clearly  indicates that in the case of eligibility for election as a  member of a Legislature, the holding of an office of  profit under a corporate body like a local authority  does not bring about disqualification even if that local  authority be under the control of the Government. The  mere control of the Government over the authority having  the power to appoint, dismiss, or control the working of the  officer employed by such authority does not disqualify that  officer from being a candidate for election as a member of  the Legislature in the manner in which such disqualification  comes into existence for being elected as the President or the  Vice-President."                                     (Emphasis supplied)

The above brings into focus that ’State Government’ is different  from ’local or other authorities under the control of the State  Government’ for purposes of disqualification.  

14.     We will not deal with the disqualification prescribed under  Section 9-A of the Act in more detail, as that is the subject matter  of the appeal before us. The said section reads thus :-  "9-A. Disqualification for Government contracts,  etc.- A person shall be disqualified if, and for so long as,  there subsists a contract entered into  by him in the  course of his trade or business with the appropriate  Government for the supply of goods to, or for the  execution of any works undertaken by, that Government.  

Explanation : for the purpose of this section, where a  contract has been fully performed by the person by the  person by whom it has been entered into with the  appropriate government, the contract shall be deemed  not to subsist by reason only of the fact that the  government has not performed its part of the contract  either wholly or in part."

Section 7 defines the terms ’appropriate government’ and  ’disqualified’ used in Chapter III (which includes section 9-A) of the  Act, thus :-  

"7.  Definitions. - In this Chapter.-  

(a)     ’appropriate Government’ means in relation any  disqualification for being chosen as or for being a  member of either House of Parliament, the Central  Government and in relation to any disqualification  for being chosen as or for being a member of the  Legislative Assembly or Legislative Council of a  State, the State Government;"

(b)     ’disqualified’ means disqualified for being chosen  as, and for being, a member of either Houses of  Parliament or of the Legislative Assembly or  Legislative Council of a State".  

As we are dealing with disqualification for being chosen as a  Member of the Legislative Council, the term ’appropriate

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government’ in section 9-A refers to and means the ’State  Government’.  

15.     The term ’State Government’ is not defined either in the  Constitution of India or in the Act (that is Representation of the  People Act, 1951). Clause (a) of sub-section (1) of section 2 of the  Act provides that unless the context otherwise requires, each of the  expressions defined in section 2 or sub-section (1) of section 27 of  the Representation of the People Act, 1950, but not defined in the  Act, shall have the same meaning as in that Act. Section 2(j) of the  Representation of the People Act, 1950 defines "State Government"  as follows :-  

"2(j). ’State Government’.- State Government  in  relation to Union Territory means the administration  thereof."  

Section 2(60) of the General Clauses Act, 1897, provides that the  term "State Government", as respects anything done or to be done,  shall mean in a State, the Governor.  

16.     The High Court after an exhaustive consideration of the  provision of MGMIDC Act and MJA Act, and the principles laid down  by this Court with reference to Article 12, has held that GMIDC and  MJP answer the definition of "State" under Article 12 of the  Constitution. This is not seriously disputed by the Appellant. Having  reached the conclusion that both GMIDC and MJP answer the  definition of State under Article 12, the High Court wrongly and if  we may say so, without any logical basis, assumed that they are  ’appropriate government’ and consequently, the appellant who had  subsisting contracts with GMIDC and MJP incurred disqualification  under section 9-A of the Act. Neither Article 12 nor the decisions  rendered with reference to Article 12 is of any assistance for  interpreting Section 9A of the Act. The term ’State Government’ (as  also the term ’Central Government’) is used in the various  provisions relating to disqualification, in contradistinction from its  instrumentalities or local or other authorities. While it is true that  the meaning of the terms ’State’ and ’State Government’ may  depend on the context in which they are used, the manner in which  the said terms are used in the various provisions relating to  disqualification leaves no doubt that ’State’ refers to an entity  described in the First Schedule to the Constitution of India and  ’State Government’ refers to the three wings of governance of the  ’State’ that is Executive, Legislature and Judiciary. The term ’State  Government’ in section 9A (read with section 7 of the Act) should,  therefore, be understood in its ordinary and normal sense, and not  with reference to the extended meaning under Article 12 of the  Constitution of India.   

17.     Article 12 provides that in Part III of the Constitution dealing  with fundamental rights, the word ’State’ would refer to and include  not only the Government of India, Parliament of India, the  Government and Legislature of each of the States, but also all local  and other authorities within the territory of India and all local and  other authorities under the control of Government of India. The  significance of Article 12 lies in the fact that it occurs in Part III of  the Constitution which deals with Fundamental Rights. The various  Articles in Part III have placed responsibilities and obligations on  the "State" vis-a-vis the individual, to ensure constitutional  protection of the individual’s rights against the "State", including the  right to equality under Article 14, and equality of opportunity in  matters of public employment under Article 16 and most  importantly the right to enforce all or any of those fundamental  rights against the "State" as defined in Article 12, either under

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Article 32 or Article 226 of the Constitution [vide Pradeep Kumar  Biswas (supra)]. The decisions rendered under Article 12 lay down  that a body would answer the definition of State under Article 12 if  it is financially, functionally and administratively dominated by or  under all pervasive control of the "Government". On the other hand,  where the control by the "Government" is merely regulatory,  whether under any statute or otherwise, it would not serve to make  the body ’State’. Thus the very decisions relied on by the High Court  make it clear that ’instrumentalities of State’ are different from  ’State Government’, though both may answer the definition of  ’State’ under Article 12 for the limited purpose of Part-III of the  Constitution. Further, the very inclusive definition of ’State’ under  Article 12 by referring to Government of India, the Government of  each of the States and the local and other authorities, makes it  clear that a ’State Government’ and a local or other authorities, are  different and that they fall under a common definition only for the  purpose of Part-III of the Constitution. This Court has consistently  refused to apply the enlarged definition of ’State’ given in Part-III  (and Part-IV) of the Constitution, for interpreting the words ’State’  or ’State Government’ occurring in other parts of the Constitution.  While the term "State" may include a State Government as also  statutory or other authorities for the purposes of part-III (or Part- IV) of the Constitution, the term "State Government" in its ordinary  sense does not encompass in its fold either a local or statutory  authority. It follows, therefore, that though GMIDC and MJP may fall  within the scope of ’State’ for purposes of Part-III of the  Constitution, they are not "State Government" for the purposes of  section 9-A (read with section 7) of the Act.  

18.     The object and intent of section 9A of the Act is to maintain  the purity of the legislature and to avoid conflicts between duty and  interest of members of Legislative Assembly and Legislative Council.  The said object is sought to be achieved by ensuring that a person  who has entered into a contract with the State Government and  therefore liable to perform certain obligations towards the State  Government, is not  elected as a member of the Legislative  Assembly or Legislative Council, lest he should use his influence as  an elected member of Legislature to dilute the obligations or to seek  and secure undue advantages and benefits in respect of  the  subsisting contracts. It seeks to ensure that personal interests will  not override his duties and obligations as a member of Legislature  or Legislative Council. For the purpose of section 9-A, what is  relevant is whether the candidate has a subsisting contract with the  appropriate Government (in this case, the State Government) either  for supply of goods to the State Government or for execution of any  work undertaken by the State Government. The six requirements  for application of disqualification under section 9A of the Act where  a candidate holds a contract for execution of works undertaken by  the appropriate Government have been listed by this Court in  Kartar Singh Bhadana vs. Hari Singh Nalwa [2001 (4) SCC  661] as follows :-  

(i)     There should be a contract entered into by the  candidate; (ii)    Such contract should be entered into by him in the  course of his trade or business; (iii)   The contract should be entered into with the appropriate  Government; (iv)    The contract should subsist; (v)     The contract should relate to the works undertaken by  the appropriate Government; and (vi)    The contract should be for execution of such works.

This Court in KARTAR SINGH (supra) also clarified that :

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"the provisions of Section 9A disqualify a citizen from  contesting an election; a citizen may, therefore, be  disqualified only if the facts of his case squarely fall  within the conditions prescribed by Section 9A."

[Emphasis supplied]  

19.     It is clear from section 9A of the Act that only certain type of  contracts with the State Government will result in disqualification.  For example subsistence of a mining lease granting by a  government to the candidate to win minerals from a specified area  was held not to attract section 9A in Kartar Singh Bhadana  (supra). A contract for collection of tolls at a government ferry was  held to be not a contract for execution of any work undertaken by  the appropriate government in Dewan Joynal Abedin vs. Abdul  Wazed  [1988 Supp. SCC 580]. A subsisting contract for sale of  liquor with the appropriate government was held to be not a  contract falling under section 9A in Ranjeet Singh vs.  Harmohinder Singh Pradhan [1999 (4) SCC 517]. In Ranjeet  Singh (supra), this Court reiterated the following observations in  Ram Padarath Mahto v. Mishri Sinha (AIR 1961 SC 480) :- ".......section 9-A is a statutory provision which imposes a  disqualification on a citizen. It would, therefore, be  unreasonable to take a general or broad view, ignoring the  essentials of the section and the intention of the legislature.  Purposive interpretation is necessary."  

20.     Therefore, when section 9-A provides that subsistence of a  contract with the appropriate government (either for supply of  goods or for execution of any work undertaken by that government)  will disqualify a candidate for being elected as a member of the  Legislative Assembly or Legislative Council, the term ’appropriate  Government’ refers to the State Government alone, and not to any  instrumentality of the State Government.  We, therefore, hold that  GMIDC and MJP  constituted under the MGMIDC Act and MJA Act  respectively, are not ’State Government’ and, therefore, any  contracts with them are not contracts entered into by the candidate  with the appropriate government. We accordingly answer both parts  of question (i) in the negative.  

Re : Question (ii)

21.     We will next consider the question as to whether the contract  dated 19.5.1996 entered by the appellant with the Maharashtra  State Government which stood transferred to GMIDC in the year  1998 could be considered to be a subsisting contract with the State  Government in the year 2002. The first respondent contended that  the said contract dated 19.5.1996 was between the appellant and  the state government; that the said contract was not amended  substituting ’GMIDC’ as the employer in place of ’State of  Maharashtra’; that the said contract was entered by the appellant in  the course of his business with the State Government for execution  of work undertaken by the State Government; and that the said  contract was subsisting as on the date of scrutiny and acceptance of  the nomination; and that the subsistence of the said contract  attracted the disqualification under section 9-A of the Act.  

22.     The appellant does not dispute the fact that his concern  entered into the said contract dated 19.5.1996 with the State  Government for execution of a work undertaken by the State  Government, or  the fact that the said contract dated 19.5.1996  was subsisting on the date of his nomination and scrutiny of  nominations. What is contended is that the contract stood

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transferred to GMIDC in the year 1998 by virtue of the provisions of  MGMIDC Act and, thereafter, the  said contract ceased to be a  contract with the State Government and therefore, what was  subsisting in June, 2002 (at the time of filing nomination/scrutiny of  nomination/declaration of result) was a contract with GMIDC and  not a contract with the State Government.  23.     What is relevant under section 9-A of the Act is that the  contractor should have some obligations to perform towards the  State Government on the relevant date. In fact, the explanation to  section 9-A makes it clear that where a contractor has performed all  his obligations, but the government is yet to perform its obligations  (for example, where the work assigned under a work order is  completed by the contractor and that is duly certified, but payment  therefore is not yet made by the Government) then there is no  contract ’subsisting’ within the meaning of section 9-A of the Act.  

24.     A contract subsists till the rights and obligations thereunder  are finally performed. The general rule is that though an employer  may assign the benefits and obligations of a contract to an  assignee, he will not be relieved of his obligations towards the  contractor, unless the contractor is also a party to the assignment,  in which event there is an assignment coupled with novation, (a  new contract between the assignee and the contractor). But the  exception to this general rule is where a statute vests certain assets  of the State in a statutory corporation (or Government Company or  other specified person) and provides that as a consequence, the  rights and obligations of the State relating to such assets shall  stand transferred to such statutory corporation (or Government  Company or specified person). In that event, the statute engrafts  itself into the existing contract and as a consequence, the statutory   corporation stands substituted in place of the original employer,   and the existing contracts become contracts between the statutory  corporation and the contractor. In case of such statutory  vesting/transfer, the consent of the contractor for the substitution  of the contracting party and the assignment/transfer of the contract  is not necessary.  

25.     The Maharashtra State Legislature enacted the Maharashtra  Godawari Marathwada Irrigation Development Corporation Act,  1998 (published in the Maharashtra Government Gazette dated  17.8.1998) The object of the Act was to make special provisions for  promotion and operation of irrigation projects, command area  development and schemes for generation of hydro-electric energy  to harness the water of Godawari river pertaining to State of  Maharashtra and other allied and incidental activities by establishing  the Godawari Marathwada Irrigation Development Corporation.   Section 3 required the State Government to establish a Corporation  by notification in the Official Gazette. Accordingly, by Notification  dated 28.8.1998, the Corporation (GMIDC) was so established  under the Act. Sub-section (2) of  section 3 provides that  Corporation established under sub-section (1) of section 3 shall be a  body corporate having perpetual succession and a common seal,  with power to contract, acquire, hold and dispose of property and to  do all things necessary for the purpose of the Act and may sue and  be sued in its corporate name. Section 15 relates to vesting and  transfer of property, assets, liabilities and obligations to the  Corporation. It reads thus: "15(1). From such date as may be specified, from time to  time, by the State Government  (hereinafter in this section  referred to as "the appropriated date"),

(a)     the properties and assets comprising movables and  immovables including Irrigation Projects, Hydro-Electric  Power Projects, works under construction and management  of completed schemes, specified in that behalf, situated in

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the area of operation of the Corporation, which  immediately before the appointed date vested in the  State Government and were under the control of the  Irrigation Department, shall vest in and stand  transferred to the Corporation and all income derived and  expenses incurred in that behalf be brought on books of the  Corporation; and  

(b)     the rights, liabilities and obligations of the State  Government, whether arising out of any contract or  otherwise pertaining to the said projects of the State  Government shall be deemed to be the rights, liabilities and  obligations of its corporation.  

(2)     Such properties, assets, rights, liabilities and  obligations shall be valued in such manner as the State  Government may determine.  

(3)     All suits and other legal proceedings with respect to  any scheme for the development of Irrigation Projects and  Hydro-Electric power Projects vested in the Corporation,  under sub-section (1), instituted against or defended by the  State Government before the appointed date may be  continued, or defended by or against, the Corporation."  

The projects that stood transferred to and vested in GMIDC from  the State Government are described in the Schedule to the Act,  namely, "all completed, on-going and major, medium and minor  irrigation projects within the area of operation of the Corporation  (excluding Bhandaradara Hydro-Electric Power Project and Ghatgar  Hydro-Electric Power Projects)" in the districts of Aurangabad,  Jaina, Parbharri, Beed, Usmanabad, Latur, Nanded, Ahmednagar  and Nashik.  

26.     It is not in dispute that from the appointed date (1.10.1998),  the Tawarja Project (a Medium Irrigation Project in Latur Division)  with all rights, liabilities and obligations of the State Government  stood vested in and transferred to the Corporation (GMIDC). As a  consequence, all rights, liabilities and obligations relating to the said  project, including the rights, liabilities, and obligations under the  contract dated 19.5.1996 (which was one of the contracts relating  to the said project) statutorily vested in and stood transferred to   GMIDC, and the contract ceased to be a contract with the State  Government. When all rights and obligations of the State  Government under the contract were transferred and vested in the  statutory corporation (GMIDC) by virtue of the statute, no separate  instrument of transfer or assignment is necessary, nor the consent  of the contractor is necessary for the transfer and vesting, as the  statute engrafts itself over the subsisting contract. The contract, on  such statutory transfer and vesting, though originally entered with  the State Government ceased to be a subsisting contract with the  State Government from the date of such transfer and vesting and  will be considered as a subsisting contract with the statutory  corporation (GMIDC). Therefore, the contract dated 19.5.1996  though subsisting on the date of filing of nominations and scrutiny  of nomination, was not a contract with the appropriate Government,  but with GMIDC.

Re : Question (iii) :

27.     Out of the three subsisting contracts, the contract dated  19.5.1996 was with GMIDC and contracts dated 31.12.1998 and  12.4.1999 were with MJP. We have already held that neither GMIDC  nor MJP is ’appropriate government’. Therefore, the appellant had  no subsisting contract with the appropriate government either for

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supply of any goods or for execution of any work undertaken by  that government in June, 2002 (on the date of filing the  nomination, the date of scrutiny of nominations and the date of  declaration of result). Consequently, the appellant did not incur any  disqualification under Section 9A of the Act.

28.      Accordingly, we allow this appeal and set aside the order of  the High Court and reject the challenge to the election of appellant  by the first respondent in Election Petition No. 1 of 2002 on the file  of the High Court of Bombay, (Aurangabad Bench). The said  Election Petition stands dismissed. Parties to bear their respective  costs.