Parliament?s power to nullify judicial decisions

CAN PARLIAMENT encroach upon the judicial power of courts? And can Parliament nullify the effect of a judicial decision by enacting a law? The smog surrounding these Constitutional questions was cleared by the Supreme Court sometime back.

CAN PARLIAMENT encroach upon the judicial power of courts? And can Parliament nullify the effect of a judicial decision by enacting a law? The smog surrounding these Constitutional questions was cleared by the Supreme Court sometime back.

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The court had before it a case, arising out an award made by the Central Government Industrial Tribunal more than two decades back. The Tribunal ruled that that apart from the bonus which the staff of the State Bank of India were paid under the Payment of Bonus Act, they were also entitled to get, as in past years, ‘customary bonus’ at the rate of one month’s substantive pay every half year.

However, Parliament nullified the effect of the Tribunal’s award by a 1984 Amendment Act. It inserted a new Section, 43A, in the State Bank of India Act; it stipulated that “notwithstanding any judgment, decree or order of any court, tribunal or other authority”, the staff of the State Bank of India “shall not be entitled to be paid any bonus, except what is payable under the Payment of Bonus Act”.

By a single stroke this legislative amendment nullified the Tribunal’s ruling, and the State Bank staff in India was deprived of ‘customary bonus”. But rather than taking it lying down, State Bank’s Staff Union embarked on a long legal battle, first unsuccessfully at the Madras High Court and then at the Supreme Court.
The Union assailed the 1984 Amendment Act as being ultra vires the Constitution.

Parliament, it vehemently argued, had no competence to nullify a judicial decision retrospectively by making an enactment, in this case of the Central Government Industrial Tribunal.

The Union’s plea, however, did not carry weight with the Supreme Court, which focused on the distinction between (i) “encroachment by Parliament on the judicial power of the courts”, and (ii) “nullification by Parliament of the effect of a judicial decision by changing the law retrospectively” (2005 (1) SCCD, 559).
The first one, that is, encroachment by Parliament on the judicial power, is “outside the competence of the Legislature”, but the other one, that is, nullification of the effect of a judicial decision by changing the law retrospectively, is well within the ‘permissible limits” of the Legislature, the apex court ruled.

The Legislature, said Justice Arijit Pasayat and Justice HK Sema, who decided the case, cannot set aside an “individual decision inter parties” and affect their individual rights and liabilities.

Such an act on part of the Legislature amounts to “exercising the judicial power by it as an appellate court or tribunal”, which is against the concept of “separation of powers” under the Constitution,” held the Supreme Court.
However, they ruled, when any amendment is implemented retrospectively or when any provision of an Act is deleted retrospectively, the rights of some are bound to be affected one way or the other.

The Legislature can change the “basis” on which a decision is given by the court and thus change the law in general, affecting “a class of persons and events at large”.

At any time, ruled the court, in exercise of its plenary powers conferred on it by the Constitution, the Legislature can render a judicial decision ineffective by enacting a “valid law” on a subject within its legislative competence, fundamentally “altering or changing” with “retrospective, curative or neutralising effect” the very ‘condition’ on which such judicial decision is based.

This was what had been done by the impugned 1984 Amendment Act in this case, and so, it could not be taken exception to as being unconstitutional.
But what if a question is raised that the Legislature passed such a law for “extraneous” reason?

“The Legislature cannot be accused of having acted so”, observed the court.
But, even assuming that the Executive, in a given situation, had an ‘ulterior motive’ in moving a legislation, that cannot render the passing of the law mala fide. This kind of “transferred malice” is unknown in the field of legislation, added the judges.

So, sadly, ‘customary’ bonus, payable twice a year for the country’s State Bank of India staff, now belongs to their long sweet past, that may never return now, what with the tightening grip of global norms on work-wage relationship in India.