Asa Ram vs The District Board, Muzaffarnagar

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: supreme-court

Case Number: Criminal Appeal No. 119 of 1956

Decision Date: 03/12/1958

Coram: K.N. Wanchoo, Natwarlal H. Bhagwati, Bhuvneshwar P. Sinha

In the matter titled Asa Ram versus the District Board of Muzaffarnagar, the Supreme Court delivered its judgment on the third day of December 1958. The decision was authored by Justice K.N. Wanchoo and was joined by Justices Natwarlal H. Bhagwati and Bhuvneshwar P. Sinha. The case was cited as 1959 AIR 480 and appears in the 1959 Supplement to the Supreme Court Reporter at page 715. The dispute involved the appellant, Asa Ram, who was engaged in operating machinery powered by electricity within the locality of Jalalabad, an area that formed part of the Muzaffarnagar Town Area. The respondent, the District Board of Muzaffarnagar, had framed Muzaffarnagar Factories Bye‑laws under Section 174(1)(k) of the Uttar Pradesh District Boards Act, read together with Section 106 of the same Act, requiring any person carrying on such machinery to obtain a licence. The appellant admitted that his trade was of the offensive kind described in the bye‑laws but contended that the bye‑laws could not be applied to him because the provisions of the Town Areas Act, specifically Section 26(a), governed the regulation of offensive trades within a town area, and therefore a licence under the District Board’s bye‑laws was unnecessary.

The Court examined the interplay between two statutes that each conferred regulatory power over the same subject matter. Section 174(1)(k) of the District Boards Act gave the District Board authority to frame bye‑laws for rural areas, a category that the statute expressly included town areas. However, Section 93(3) of the same Act prohibited the District Board from exercising, within the limits of a town area, any authority that had been vested in a “Town Panchayat”. An amendment to the Uttar Pradesh Town Areas Act in 1934 replaced the term “Town Panchayat” with “Town Area Committee”, but the amendment did not revise Section 93(3) of the District Boards Act. The respondent argued that because no “Town Panchayat” existed after the amendment, the restriction in Section 93(3) no longer applied, and consequently the District Board retained power to frame bye‑laws for the town area. The Court rejected this argument, holding that the substitution of the word “committee” for “panchayat” was merely a translation and did not effect a substantive change. Accordingly, the limitation imposed by Section 93(3) remained fully effective, preventing the District Board from legislating for the town area. The Court further explained that where a larger statutory body’s jurisdiction is subdivided and a smaller statutory body is created for the carved‑out area, the law granting power to the smaller body must prevail over the law granting power to the larger body. Applying this principle, the Court concluded that the Town Area Committee, as a new statutory entity created by the 1934 amendment, possessed exclusive authority over the regulation of offensive trades within the town area, and the District Board’s attempt to impose its bye‑laws was invalid. Consequently, the prosecution of the appellant for failure to obtain a licence under the District Board’s bye‑laws was held to be unsustainable and was set aside.

When a statute creates a separate authority for a smaller geographical portion that has been carved out of a larger area, the law intends that the powers granted to the newly created body will override the powers of the authority that continues to govern the larger area. If the amendment enacted in 1934 to the Town Areas Act established a distinct entity called the Town Area Committee, this would indicate that a subset of the original jurisdiction was separated in 1934, and the statutory powers conferred upon the Committee would take precedence. In situations where two statutes assign conflicting powers to two different bodies, the later enactment supersedes the earlier one, thereby rendering the earlier authority ineffective. Accordingly, on the basis of this principle, the authority of the Town Area Committee—if it is regarded as a new statutory body created by the 1934 amendment—must prevail over the authority of the District Board. The Court relied upon the precedents set in King v. The Justices of Middlesex, (1831) 169 E. R. 1347 and Daw v. The Metropolitan Board of Works, (1862) 133 R.R. 311 to support this view. The Court also noted that the power to regulate a trade necessarily includes the power to frame bye‑laws that require the issuance of a licence, a principle that was referred to in Mohamad Yasin v. The Town Area Committee, jalalabad, [1952] S.C.R. 572.

The appeal was filed under criminal appellate jurisdiction as Criminal Appeal No. 119 of 1956, challenging the judgment and order dated 11 May 1956 of the Allahabad High Court in Criminal Revision No. 1724 of 1955. That order, in turn, upheld the order dated 13 July 1955 of the Additional District Magistrate (Judicial), Muzaffarnagar, which had confirmed the finding of the Magistrate‑First Class, Muzaffarnagar, dated 14 February 1955 in Criminal Case No. 132 of 1955. Counsel for the appellant were Rameshwar Nath and S. N. Andley, while the respondent was represented by C. K. Daphtary, Solicitor‑General of India, and P. C. Aggarwal. The judgment was delivered on 3 December 1958 by Justice Wanchoo. The core issue raised by the certificate granted by the Allahabad High Court concerned the interpretation of certain provisions of the Uttar Pradesh District Boards Act (U. P. X of 1922) and the Uttar Pradesh Town Areas Act (U. P. No. II of 1914). The factual background was that the appellant, Asa Ram, operated powered machines at a premises that were acknowledged to lie within the Jalalabad town area from the fiscal year 1953‑54. He failed to obtain a licence for those machines for that year, contrary to bye‑law (7) of the Muzaffarnagar Factories Bye‑laws, which had been framed by the District Board of Muzaffarnagar under section 174(1)(k) read with section 106 of the District Boards Act. Consequently, he was prosecuted for violating the said bye‑law. While he admitted to operating the machines with power, he argued that because the premises were situated in the Jalalabad town area, the bye‑laws made by the District Board were inapplicable to him, and therefore a licence was not required. He maintained that the prosecution initiated by the District Board for contravention of the bye‑law was therefore invalid. The resolution of this contention depended upon the construction of section 93(3) of the District Boards Act and section 26 of the Town Areas Act.

The Court explained that the matter required an interpretation of section 93(3) of the District Boards Act together with section 26 of the Town Areas Act. At the trial stage the magistrate examined those provisions and concluded that the bye‑laws made by the District Board could not be enforced on premises situated inside the Jalalabad town area. Accordingly, the magistrate held that Asa Ram was not required to obtain a licence for operating his machines and therefore acquitted him of the charge of contravening the bye‑laws. The District Board filed a revision application, but the Additional District Magistrate (Judicial) at Muzaffarnagar dismissed that application, affirming the trial magistrate’s view. Unsatisfied, the District Board proceeded to a further revision before the High Court of Allahabad. A single learned judge of that court framed three specific questions for determination: first, whether the operation of a flour mill or similar activity constituted an offensive trade; second, whether the term “regulation” used in section 26(a) of the Uttar Pradesh Town Areas Act encompassed the power to issue a licence; and third, whether section 93(3) of the District Boards Act effectively removed the District Board’s authority in favour of the Town Area Committee. On the first question, the judge expressed the opinion that the machines operated by Asa Ram would fall within the scope of section 26(a) of the Town Areas Act, although he observed that it was not essential to resolve that issue for the purposes of the appeal. Regarding the second question, the judge held that the word “regulation” did not include the power to grant a licence, a view that conflicted with a Division Bench decision of the same High Court reported as Municipal Board, Hathras v. Behrey Narain Dutt (1). He supported his conclusion by relying on an earlier Supreme Court decision, Mohamad Yasin v. The Town Area Committee, Jalalabad (2), which addressed a similar point of law.

On the third question, the judge determined that section 93(3) barred the District Board from exercising any power in a town area that was vested in the body specified by that provision. He further reasoned that the 1934 amendment of the Town Areas Act, which replaced the term “Panchayat” throughout the Act with “Committee,” did not affect the operation of section 93(3) because the District Boards Act had not been amended in parallel to substitute “Town Area Committee” for “Town Panchayat.” Nevertheless, because he had concluded that “regulation” did not include the authority to grant licences, the judge concluded that the bye‑laws made by the District Board for the issuance of licences were applicable to premises located within town areas. Consequently, he set aside the trial magistrate’s acquittal and ordered that a retrial be conducted. The judge also granted leave to appeal the matter to this Court. The three issues framed by the High Court thus re‑emerged for consideration before the Supreme Court. The learned Solicitor General, appearing for the District Board, did not challenge the correctness of the decision on the first issue, namely whether the operation of the appellant’s machines fell within the ambit of section 26(a) of the Town Areas Act.

The Solicitor General for the District Board does not dispute the correctness of the first issue, namely whether the operation of the appellant’s machines falls within the words of section 26(a) of the Town Areas Act. To see that the decision is right, it suffices to set out the two relevant provisions. Section 174(1)(k) of the District Boards Act, under which the bye‑laws were made, reads: “regulating slaughter houses and offensive, dangerous or obnoxious trades, callings, or practices and prescribing fees to defray the expenditure incurred by a board for this purpose.” Section 26(a) of the Town Areas Act reads: “The Committee may by general or special order in writing provide and if so advised by the district magistrate shall provide for all or any of the following matters within the town area, namely: (a) the regulation of offensive callings or trades ….” It follows that section 26(a) is co‑extensive with section 174(1)(k) with respect to the regulation of offensive trades or callings. Because the Solicitor General does not contest the High Court’s finding that the trades carried on by Asa Ram using his powered machines are offensive trades, the Town Area Committee possesses the power to regulate those trades just as the District Board does. Regarding the second issue, the Solicitor General agrees that the term “regulation” includes the power to issue a licence, and this view is correct. No authority has been cited in which this Court held that “regulation” does not comprise the power to grant licences, nor that the issuance of a licence amounts to prohibition rather than a restriction on a trade or business. It is sufficient to note that the District Boards Act, which authorises the bye‑laws, does not expressly provide for the grant of licences. Section 174(1)(k) mentions only the regulation of offensive trades and does not in plain words confer licence‑granting authority. Section 106 allows the board to charge a fee fixed by bye‑law for any licence, sanction or permission that the Act requires it to grant, but this provision merely provides for the levy of a fee where a licence is already authorized by other provisions; it does not itself create the power to issue licences. Consequently, when the Board framed a bye‑law concerning the issue of licences, it acted under its general power of regulation. The High Court appears to have mis‑interpreted the decision in Mohamad Yasin’s case, which concerned whether the Town Areas Committee could impose a fee; that case did not address the question of the Committee’s power to issue a licence.

In the case, the High Court highlighted a sentence from the judgment which read: “We have not been referred to any notification whereby Section 294 of the U.P. Municipalities Act was extended to the respondent committee.” Section 294 of the Municipalities Act mirrors Section 106 of the District Boards Act and concerns the power to levy fees. The Court observed that the High Court had conflated two distinct concepts: the authority to grant licences, which arises from a power of regulation, and the authority to levy licence fees, which can be exercised only when the statute expressly provides for such a fee. The precedent in Mohamad Yasin’s case (1) held that a Town Area Committee could not levy a licence fee because the legislation did not empower it to do so. However, that decision did not deny that the term “regulation” includes the power to issue licences. Consequently, where the law does not contain a specific provision for charging a licence fee, a licence must be issued free of charge if the bye‑law requires a licence to regulate a trade or calling that the Town Area Committee may regulate under Section 26(a) of the Town Areas Act (see 1952 S.C.R. 572). The learned Judge’s conclusion that a Town Area Committee could not issue a licence while framing rules to control offensive trades or callings is therefore erroneous. The Committee is entitled to enact bye‑laws that require the procurement of licences, provided it exercises its regulatory power under Section 26(a) of the Town Areas Act, in the same manner that a District Board may enact bye‑laws under Section 174(1)(k) obliging persons engaged in certain trades to obtain licences.

The discussion then turned to the third issue, namely the result when two statutory bodies possess concurrent authority in the same domain. The District Board’s power to make bye‑laws under Section 174(1)(k) was limited to the “rural area” as defined in Section 3(10). Although that definition was amended in 1958 to exclude town areas from the rural area, at the relevant time it read: “‘Rural area’ means the area of a district excluding every municipality as defined in the United Provinces Municipalities Act, 1916 and every cantonment as defined in the Cantonment Act, 1910.” Accordingly, during the period in question, the District Board retained the power to formulate bye‑laws even for town areas. To prevent any possible conflict between overlapping jurisdictions, Section 93(3) was incorporated into the District Boards Act, stating: “Nothing in this Act shall entitle a board to exercise within the limits of any municipality, notified area, cantonment or town area, any authority which is vested in the municipal board, notified area committee, cantonment committee, district magistrate, or town panchayat, as the case may be.” The provision contains certain exceptions, which are not relevant to the present dispute.

The Court noted that the present dispute did not involve the specific exceptions to the provision previously discussed. The Solicitor General argued that the District Board would lose its authority to make bye‑laws regulating offensive trades and callings in town areas if that same authority were vested in the town panchayat. He further contended that, at the relevant time, no Town Panchayats possessed authority in town areas because every occurrence of the expression “Town Panchayat” in the Town Areas Act had been replaced by the expression “Town Area Committee.” The Solicitor General submitted that the amendment which introduced the term “Town Area Committee” had not been mirrored in section 93(3) of the District Boards Act. Consequently, he argued, although the District Board would have been powerless up to the year 1934 to enact bye‑laws for town areas concerning the regulation of offensive trades or callings—matters that fell under section 26(a) of the Town Areas Act—it would have acquired that power after the 1934 amendment. The Court described this contention as a highly technical argument. It recalled that the Town Areas Act had originally been enacted in 1914, and at that time the authority conferred by section 26(a) was vested in the Town Panchayat. In 1920, the Uttar Pradesh Village Panchayat Act created panchayats for villages or groups of villages. At that stage, the legislature apparently found it prudent to replace the term “Town Panchayat” with “Town Area Committee” in the Town Areas Act to avoid confusion with the newly created village panchayats. The Court held that this substitution was essentially a formal change only, because the English word “committee” is, in effect, a translation of the Hindi word “panchayat.” Therefore, when “committee” replaced “panchayat” in the Town Areas Act, there was no substantive alteration of the legal position, and the limitation on the District Board’s power imposed by section 93(3) of the District Boards Act continued to operate fully with respect to matters assigned to the town areas.

The Court then turned its attention to the earlier decision in Shrimati Hira Devi v. District Board, Shah‑jahanpur. In that case, section 71 of the Uttar Pradesh District Board Act had been amended, but no corresponding amendment was made to section 90. The Court quoted the observations made on page 1131 of that judgment, which stated that it was unfortunate that the legislature, when amending the old section 71, omitted a conforming amendment to section 90. The Court emphasized that such a legislative gap could not be remedied by a liberal construction akin to that adopted by the High Court in interpreting the phrase “orders of any authority … whose sanction is necessary.” While acknowledging the court’s duty to harmonise the various provisions of a legislative enactment, the Court warned that it was not the court’s role to stretch the words employed by the legislature in order to fill gaps or omissions in the provisions of an Act. The Court observed that the reasoning in Hira Devi pertained to a different factual context and therefore could not be directly applied to the matter before it.

In this case the Court observed that the factual backdrop differed entirely from that in the earlier decision. The present dispute involved two separate statutes that each conferred authority on a different statutory body. The Court noted that, should a conflict arise in light of the technical submission made by the learned Solicitor General and if section 93(3) could not assist the Town Area Committee, it remained necessary to determine which Act would dominate the situation. The Court explained that the Uttar Pradesh District Boards Act covered a broader geographical area, within which the territory designated as a town area was also situated. Conversely, the Town Areas Act dealt with a more limited region. According to the Court, when a larger jurisdiction is divided and a smaller portion is assigned to another body, the law that empowers the body governing the smaller area should prevail over the law that empowers the body governing the larger area. The Court further considered whether the substitution of the term “committee” for the term “panchayat” was merely a matter of translation. If it was only a translation, the Court held that the application of section 93(3) would remain unchanged even after the 1934 amendment. However, if the substitution was not a simple translation and the amendment of 1934 was interpreted as creating a new body with powers under the Town Areas Act, then the smaller area would have been carved out of the larger area in 1934 and a new statutory entity would have been established to administer it. In such circumstances, the Court said, the powers granted to the newly created body in the smaller area would take precedence.

The Court then referred to two English authorities that articulated the principle for resolving conflicts between statutes in analogous situations. In King v. The Justices of Middlesex (1831) 2 B.&  and  AD 818; (1831) 109 E.R. 1347, 1348, the Court noted that when two Acts of Parliament passed in the same session and received Royal assent on the same day were inconsistent, the later‑assented Act prevailed and operated as a partial repeal of the earlier. The Court also cited Daw, Clerk of the Commissioner of Sewers of the City of London v. The Metropolitan Board of Works, which held that where two statutes conferred authority on two public bodies in a manner that could not consistently coexist with the legislative intent, the earlier statute must be deemed repealed by the later one. The Court explained that in that precedent the conflict was between section 145 of the City of London Sewers Act, 1848 and section 141 of the Metropolis Local Management Act, 1855, and the later statute was deemed controlling. Applying the reasoning of these cases to the present facts, the Court concluded that if the expression “town area committee” was not merely a translation of “town panchayat”, the result would be that a Town Area Committee, vested with power under section 93, should have its authority upheld over the conflicting provision of the District Boards Act.

In this matter the Court examined the statutory question of which authority was entitled to regulate offensive trades or callings. It held that the power conferred on the Town Area Committee must take precedence over the power that the District Board possessed under section 174 (1)(k) of the District Boards Act. The Court therefore concluded that, for the purpose of controlling such trades, the Town Area Committee’s authority was the controlling provision and could not be displaced by the District Board’s authority. On the basis of that finding the Court turned to the appeal filed by the appellant, Asa Ram. The Court set aside the judgment that had been rendered by the High Court in the earlier proceedings. Following the reversal of the High Court order, the Court directed that the appellant be acquitted of the charges that had been brought against him. Consequently the appeal was allowed, the High Court’s order was vacated, and an acquittal in favor of Asa Ram was entered.