Minerva Mills v. Union of India

By Akanksha Singh[1]

In the Supreme Court of India

NAME OF THE CASEMinerva Mills v. Union of India
CITATION1980 AIR 1789, 1981 SCR (1) 206
DATE OF JUDGMENT31 July, 1980
APPELANTMinerva Mills Ltd. & Ors.
RESPONDENTUnion Of India & Ors.
BENCH/JUDGEChandrachud, Y.V. ((Cj), Bhagwati, P.N., Gupta, A.C., Untwalia, N.L., Kailasam, P.S.
STATUTES/CONSTITUTION INVOLVEDConstitution of India Industries (Development and Regulation) Act, 1951
IMPORTANT SECTIONS/ARTICLESIndustries (Development and Regulation) Act, 1951 – Section 18A Constitution of India – Article 368, 31B, 32, 13, 31C, 38, 19, 12, 14, 37, 31A, 352

ABSTRACT

On July 31, 1980, the Hon’ble Supreme Court issued one of the landmark decisions in our country’s constitutional history in the case of Minerva Mills versus Union of India. This decision not only maintained the basic structural concept, but it also restored people’s trust in our court. The court emphasised the necessity of judicial review and the harmonious link between basic rights and the Directive Principle of State Policy in this decision (DPSP).

INTRODUCTION

Minerva Mills v. Union of India is a landmark case that exemplifies the benefits of the checks and balances system. The Top Court rejected the concept of the Parliament being the country’s supreme law-making authority. The origin of the problem may be found in Parliament approving the 42nd Amendment Act in 1976, which granted the legislature vast powers to create laws by repealing basic rights and making them subject to the State’s Directive Principles of State Policy. Furthermore, the scope of judicial review has been limited.

The power of the legislature to amend or change the Constitution has long been contested. Prior to the Minerva Mills case, the Supreme Court ruled in I.C. Golaknath v. the State of Punjab[2] that the legislature may not change the people’ Fundamental Rights, which was subsequently reversed in the Kesavananda Bharati v. State of Kerala case[3]. The statute established in Keshavananda Bharati stated that the Parliament might revise the Constitution as long as it did not change the core framework.

Background of the case

We have witnessed a power struggle between the government and the judiciary in India since the debut of Indira Gandhi on the political scene. Indira Gandhi thinks that in order to achieve her aim of socialism, all authority should be centralised within the executive branch. The controversy began with the ruling of an 11-judge court in the Golak Nath case, which concluded that the administration had limited jurisdiction to modify the constitution. To overturn this decision, the parliament approved the 24th Amendment, which granted it limitless authority to modify any aspect of the constitution.

Following this legislation, the parliament nationalised 14 banks and actively sought to eliminate the privy cases. However, the judiciary reacted sharply, invalidating both enactments in the R.C Cooper versus Union of India[4] case. This was a significant setback to the government, and in order to overturn the decision, it proposed the 25th and 26th constitutional amendments.

The landmark Kesavananda Bharati decision, which found that the ability to change the Constitution is subject to the basic framework of the constitution, helped to settle this debate. To nullify all of these decisions, the parliament passed the most contentious 42nd constitutional amendment.

Section 4 of the 42nd amendment safeguards any activities done to uphold our Directive Principle of State policy from being declared unconstitutional, regardless of whether they contradict Article 14, 19, or 21 of the constitution. Furthermore, Section 55 grants the parliament unrestricted authority to change the constitution. In the Minerva Mills versus Union of India case, the constitutionality of both of these provisions was questioned.

FACT OF THE CASE

Minerva Mills (petitioner) was a textile manufacturer in the Indian state of Karnataka. Its primary activity was the large-scale manufacture of silk textiles for the market. At the time, the government was in full stride toward its socialist paradigm, purchasing ill firms for public use.

The government did the same thing with Minerva Mills, declaring it a sick firm and taking over administration under Section 15 of the IDBI Act of 1951. The corporation was unable to contest this judgement in court since Section 4 of the 42nd Constitutional Amendment exempts all measures undertaken to enforce the socialist programme from judicial scrutiny.

As a result, the petitioner challenged the constitutionality of Sections 4 and 55 of the 42nd Constitutional Amendment of 1976.

ISSUES RAISED BEFORE THE COURT

  • Whether Sections 4 and 55 of the 42nd Amendment to the Constitution violate the essential structure of the Constitution?
  • Is it true that the directive principles of State policy (DPSP) stated in Part IV take precedence over the basic rights enshrined in Part III of the constitution?

ARGUMENTS RAISED BY THE APPELLATE

Nani Palkhivala represented the appellants; he was the Janata Government’s ambassador at the time, but felt compelled to return to India to defend human rights, thus he fought the case on behalf of the prior proprietors of the Minerva Mills.

  • Learned counsel for the appellant argued that Article 368 limits the amending powers of the legislature. This amendment would empower parliament, the Constitution’s creation, to become its master.
  • In the instant matter, it is an admitted position that the court judgement in the Kesavananda Bharati case said that Parliament does not have the jurisdiction to change the fundamental aspects of the Constitution.
  • Learned counsel for the petitioner submitted that it was the State’s responsibility to establish legislation on the Directive Principle of State Policy, but it could only be done through acceptable means; it could not overturn Fundamental Rights.
  • Learned counsel for the petitioner submitted that because of Section 55 of the 42nd Constitutional Change Act of 1976, no court would have the authority to examine the constitutional amendment voted by Parliament, threatening the balance between the judiciary and the legislature. 
  • Learned counsel for the petitioner submitted that there would be an imbalance generated between the Fundamental Rights and the Directive Principles of State Policy; therefore, a harmonious structure is required.
  • Learned counsel for the petitioner submitted that almost every law made by the government is in some way related to the Directive Principles. 

ARGUMENTS RAISED BY THE RESPONDENT

The State was defended by Attorney General L.N. Sinha and Additional Solicitor General K.K. Venugopal, who were both in a difficult position to defend the emergency amendment:

  • Learned counsel for the respondent submitted that in the absence of Fundamental Rights, Article 31C of the Indian Constitution supported the fundamental structural idea, while Directive Principles supplied aims.
  •  Learned counsel for the respondent submitted that any harm done to the Fundamental Rights will not constitute a breach of the fundamental structural theory.
  • Learned counsel for the respondent submitted that to fulfil the aims outlined in the Directive Principle of State Policy, the powers of Parliament should be supreme, with no limitations on its amending powers.
  • Learned counsel for the respondent submitted that the Court should not rule on the issue of academic interest.
  • Learned counsel for the respondent submitted that the government was supporting the corporation in raising financing through the naturalisation procedure.   

RELATED PROVISIONS

  1. The Industries (Development and Regulation) Act, 1951

 Section 18A[5]: Power of Central Government to assume management or control of an industrial undertaking in certain cases.—

(1) If the Central Government is of opinion that—

(a) an industrial undertaking to which directions have been issued in pursuance of section 16 has failed to comply with such directions, or

(b) an industrial undertaking in respect of which an investigation has been made under section 15 (whether or not any directions have been issued to the undertaking in pursuance of section 16), is being managed in a manner highly detrimental to the scheduled industry concerned or to public interest, the Central Government may, by notified order, authorise any person or body of persons to take over the management of the whole or any part of the undertaking or to exercise in respect of the whole or any part of the undertaking such functions of control as may be specified in the order.

(2) Any notified order issued under sub-section (1) shall have effect for such period not exceeding five years as may be specified in the order: 1[Provided that if the Central Government is of opinion that it is expedient in the public interest that any such notified order should continue to have effect after the expiry of the period of five years aforesaid, it may from time to time issue directions for such continuance for such period, not exceeding two years at a time, as may be specified in the direction, so however that the total period of such continuance (after the expiry of the said period of five years) does not exceed 2[twelve years]; and where any such direction is issued, a copy thereof shall be laid, as soon as may be, before both Houses of Parliament.] Explanation.—The power to authorise a body of persons under this section to take over the management of an industrial undertaking which is a company includes also a power to appoint any individual, firm or company to be the managing agent of the industrial undertaking on such terms and conditions as the Central Government may think fit.]

  • Constitution of India

Article 368[6]: Power of Parliament to amend the Constitution and procedure therefor

(1) Notwithstanding anything in this Constitution, Parliament may in exercise of its constituent power amend by way of addition, variation or repeal any provision of this Constitution in accordance with the procedure laid down in this article

(2) An amendment of this Constitution may be initiated only by the introduction of a Bill for the purpose in either House of Parliament, and when the Bill is passed in each House by a majority of the total membership of that House present and voting, it shall be presented to the President who shall give his assent to the Bill and thereupon the Constitution shall stand amended in accordance with the terms of the Bill: Provided that if such amendment seeks to make any change in

(a) Article 54, Article 55, Article 73, Article 162 or Article 241, or

(b) Chapter IV of Part V, Chapter V of Part VI, or Chapter I of Part XI, or

(c) any of the Lists in the Seventh Schedule, or

(d) the representation of States in Parliament, or

(e) the provisions of this article, the amendment shall also require to be ratified by the Legislature of not less than one half of the States by resolution to that effect passed by those Legislatures before the Bill making provision for such amendment is presented to the President for assent

(3) Nothing in Article 13 shall apply to any amendment made under this article

(4) No amendment of this Constitution (including the provisions of Part III) made or purporting to have been made under this article whether before or after the commencement of Section 55 of the Constitution (Forty second Amendment) Act, 1976 shall be called in question in any court on any ground

(5) For the removal of doubts, it is hereby declared that there shall be no limitation whatever on the constituent power of Parliament to amend by way of addition, variation or repeal the provisions of this Constitution under this article PART XXI TEMPORARY, TRANSITIONAL AND SPECIAL PROVISIONS

Article 31B[7]: Validation of certain Acts and Regulations Without prejudice to the generality of the provisions contained in Article 31A, none of the Acts and Regulations specified in the Ninth Schedule nor any of the provisions thereof shall be deemed to be void, or ever to have become void, on the ground that such Act, Regulation or provision is inconsistent with, or takes away or abridges any of the rights conferred by, any provisions of this Part, and notwithstanding any judgment, decree or order of any court or tribunal to the contrary, each of the said Acts and Regulations shall, subject to the power of any competent Legislature to repeal or amend it, continue in force.

Article 32[8]: Remedies for enforcement of rights conferred by this Part

(1) The right to move the Supreme Court by appropriate proceedings for the enforcement of the rights conferred by this Part is guaranteed

(2) The Supreme Court shall have power to issue directions or orders or writs, including writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari, whichever may be appropriate, for the enforcement of any of the rights conferred by this Part

(3) Without prejudice to the powers conferred on the Supreme Court by clause ( 1 ) and ( 2 ), Parliament may by law empower any other court to exercise within the local limits of its jurisdiction all or any of the powers exercisable by the Supreme Court under clause ( 2 )

(4) The right guaranteed by this article shall not be suspended except as otherwise provided for by this Constitution

Article 13[9]: Laws inconsistent with or in derogation of the fundamental rights

(1) All laws in force in the territory of India immediately before the commencement of this Constitution, in so far as they are inconsistent with the provisions of this Part, shall, to the extent of such inconsistency, be void

(2) The State shall not make any law which takes away or abridges the rights conferred by this Part and any law made in contravention of this clause shall, to the extent of the contravention, be void

(3) In this article, unless the context otherwise requires law includes any Ordinance, order, bye law, rule, regulation, notification, custom or usages having in the territory of India the force of law; laws in force includes laws passed or made by Legislature or other competent authority in the territory of India before the commencement of this Constitution and not previously repealed, notwithstanding that any such law or any part thereof may not be then in operation either at all or in particular areas

(4) Nothing in this article shall apply to any amendment of this Constitution made under Article 368 Right of Equality

Article 38[10]: State to secure a social order for the promotion of welfare of the people

(1) The State shall strive to promote the welfare of the people by securing and protecting as effectively as it may a social order in which justice, social, economic and political, shall inform all the institutions of the national life

(2) The State shall, in particular, strive to minimize the inequalities in income, and endeavor to eliminate inequalities in status, facilities and opportunities, not only amongst individuals but also amongst groups of people residing in different areas or engaged in different vocations

Article 31C[11]: Saving of laws giving effect to certain directive principles Notwithstanding anything contained in Article 13, no law giving effect to the policy of the State towards securing all or any of the principles laid down in Part IV shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by Article 14 or Article 19 and no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy: Provided that where such law is made by the Legislature of a State, the provisions of this Article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent Right to Constitutional Remedies

Article 19[12]: Protection of certain rights regarding freedom of speech etc

(1) All citizens shall have the right

(a) to freedom of speech and expression;

(b) to assemble peaceably and without arms;

(c) to form associations or unions;

(d) to move freely throughout the territory of India;

(e) to reside and settle in any part of the territory of India; and

 (g) to practise any profession, or to carry on any occupation, trade or business

Article 12[13]: Definition In this part, unless the context otherwise requires, the State includes the Government and Parliament of India and the Government and the Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.

Article 14[14]: Equality before law The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India Prohibition of discrimination on grounds of religion, race, caste, sex or place of birth

Article 37[15]: Application of the principles contained in this Part The provisions contained in this Part shall not be enforceable by any court, but the principles therein laid down are nevertheless fundamental in the governance of the country and it shall be the duty of the State to apply these principles in making laws

Article 31A[16]: Saving of laws providing for acquisition of estates, etc ( 1 ) Notwithstanding anything contained in Article 13, no law providing for

(a) the acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights, or

(b) the taking over of the management of any property by the State for a limited period either in the public interest or in order to secure the proper management of the property, or

(c) the amalgamation of two or more corporations either in the public interest or in order to secure the proper management of any of the corporations, or

(d) the extinguishment or modification of any rights of managing agents, secretaries and treasurers, managing directors, directors or managers of corporations, or of any voting rights of shareholders thereof, or

(e) the extinguishment or modification of any rights accruing by virtue of any agreement, lease or licence for the purpose of searching for, or winning, any mineral or mineral oil, or the premature termination or cancellation of any such agreement, lease or licence, shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by Article 14 or Article 19: Provided that where such law is a law made by the Legislature of a State, the provisions of this article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent: Provided further that where any law makes any provision for the acquisition by the State of any estate and where any land comprised therein is held by a person under his personal cultivation, it shall not be lawful for the State to acquire any portion of such land as is within the ceiling limit applicable to him under any law for the time being in force or any building or structure standing thereon or appurtenant thereto, unless the law relating to the acquisition of such land, building or structure, provides for payment of compensation at a rate which shall not be less than the market value thereof

Article 352[17]: Proclamation of Emergency

JUDGEMENT

Sections 4 and 55 of the 42nd Constitutional Amendment were ruled down by a 5 judge bench in a 4:1 majority ruling as contradicting the core structure of our Constitution. The court supported the Kesavananda Bharati decision and confirmed the fundamental structure theory.

Constitutional Validity of Section 55

According to the ruling, this clause is null and invalid since it rendered any legal challenges impossible. Furthermore, it lifts all constraints on the parliament and elevates it to ultimate power. The court determined that the primary goal of enacting Section 55 is to invalidate the consequences of the Kesavananda Bharati case.

This Section has the ability to abolish the entire sacred constitution and transform its character from democratic to dictatorial, with no one being able to dispute the governing party’s actions in a court of law. The authority of judicial review is an essential component of fundamental structure theory, and it cannot be diminished by an amendment.

Based on the Kesavananda Bharati decision, the court determined that the authority to change the constitution under Article 368 does not imply the power to demolish the whole Constitution. The word “amendment” has a negative connotation in Article 368, and it can never be used to modify the essential essence of our Constitution. In other words, the ability to modify the constitution will always be subject to our fundamental structural theory, which includes judicial scrutiny. Section 55 is thus found unlawful.

Relationship between Fundamental Rights and Directive Principle of State Policy (DPSP)

The court highlighted the real link between basic rights and the DPSP in this case. The court stated that Part III and Part IV are the identity of our Indian Constitution, and giving priority to one over the other will jeopardise the essential foundation of our Constitution. Both of these conceptions will always have a harmonic connection, with no point of supremacy between them.

Part IV requirements should be met only if all basic rights are respected. If any law or notification implementing the DPSP infringes fundamental rights, it will be declared illegal since

it is irreconcilable with our basic framework.

Constitutional Validity of Section 4

All laws or notifications are tested against our fundamental rights in our constitutional framework to evaluate their constitutional legitimacy. However, according to Section 4, Articles 14 and 19 are barred from evaluating the legitimacy of an Act. As a result, the court ruled that it violated our basic rights and overturned it.

CONCLUSION

This was one of the most significant examples in which the theory of the Basic structure was validated and given a broader meaning. Through this theory, the court guaranteed that our forebears’ goals were preserved and strengthened.

The court specifically said in this decision that if the parliament is given total power to modify the Constitution, it will become a master in its own right. This disagreement between the administration and the judiciary was resolved by requiring that all decisions be subject to judicial scrutiny in order to provide proper checks and balances between the several parts of government. The Supreme Court is the last interpreter of the constitution, and any legislation that contravene the fundamental framework will be overturned by the court. The legislature may never waive its right to constitutional redress, which is regarded as the heart and spirit of our Constitution.

The purposeful and harmonious interaction between diverse sections underpins our whole Constitution. The basic rights and the DPSP must be construed in such a way that they fulfil the spirit of our Constitution rather than contradicting one other. The Directive Principle of state policy may accomplish a lot without even jeopardising the fundamental liberties guaranteed by Part III of the constitution. In a word, our Constitution is founded on a delicate balance of authority shared by the legislative, executive, and judiciary. They must work together to attain the goals of justice.

[1] Author is 4th  semester student of  ICFAI University, Dehradun.

[2] I.C. Golak Nath v. State of Punjab, A.I.R. 1967, S.C. 1643

[3] Kesavanand Bharti v. State of Kerala, A.I.R. 1973 S.C. 1461

[4] R.C Cooper vs Union of India case , 1970 AIR 564, 1970 SCR (3) 530

[5] Section 18A in the Industries (Development and Regulation) Act, https://indiankanoon.org/doc/1892928/

[6] Article 368 in the Constitution of India, https://indiankanoon.org/doc/594125/

[7] Article 31B in the Constitution of India, https://indiankanoon.org/doc/282612/

[8] Article 32 in the Constitution of India, https://indiankanoon.org/doc/981147/

[9] Article 13 in the Constitution of India, https://indiankanoon.org/doc/134715/

[10] Article 38 in the Constitution of India, https://indiankanoon.org/doc/1673816/

[11]Article 31C in the Constitution of India, https://indiankanoon.org/doc/198382/

[12] Article 19 in the Constitution of India, https://indiankanoon.org/doc/1218090/

[13] Article 12 in the Constitution of India, https://indiankanoon.org/doc/609139/

[14] Article 14 in the Constitution of India, https://indiankanoon.org/doc/367586/

[15] Article 37 in the Constitution of India, https://indiankanoon.org/doc/76375/

[16] Article 31A in the Constitution of India, https://indiankanoon.org/doc/1028568/

[17] Article 352 in the Constitution of India, https://indiankanoon.org/doc/1018568/

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