Punjab-Haryana High Court
Jayant Kumar(Minor) Through His ... vs State Of Haryana And Others on 15 November, 2022
CWP-13397-2022 -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP-13397-2022
Date of decision : 15.11.2022
Jayant Kumar (Minor) .......Petitioner
Versus
State of Haryana and others ....Respondents
CORAM: HON'BLE MR. JUSTICE RAVI SHANKER JHA, CHIEF JUSTICE
HON'BLE MR. JUSTICE ARUN PALLI
Present: Mr. R.S. Bains, Senior Advocate, with
Mr. Aman Raj Bawa, Advocate, and
Mr. Manan Dhull, Advocate,
for the petitioner.
Mr. Deepak Balyan, Addl. Advocate General, Haryana.
****
RAVI SHANKER JHA, CHIEF JUSTICE ( Oral )
This petition has been filed by the petitioner praying for the
following reliefs :-
"a. Issue a writ, direction, order specially in the nature of
MANDAMUS directing the Respondents to issue the
Schedule for admission in Class 2nd to Class 8th under Rule
134A of Haryana School Education Rules, 2003, amended in
2013 for the academic session 2022-2023;
b. Any other appropriate writ, order or direction which
this Hon'ble Court deems fit and appropriate under the
peculiar facts and circumstances of this case, may also be
issued in the interest of equity, justice and fair play."
Learned senior counsel for the petitioner submits that Rule
134A was incorporated in the Haryana School Education Rules, 2003
(for short, 'the Rules of 2003'), making provision for reservation in
admission to schools for poor meritorious students to the extent of 25%,
which was subsequently reduced to 10%. It is submitted that this
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beneficial provision was introduced by the State Legislature in exercise
of its Rule making power contained in Section 24 of the Haryana School
Education Act, 1995 (for short, 'the Act of 1995').
It is contended that though the respondents have issued a
subsequent notification (P-4) published in the Haryana Government
Gazette on 28.03.2022, whereby the provision of Rule 134A of the Rules
of 2003 has been deleted and omitted, but as the State Legislature has not
complied with the provision of Section 24 (3) of the Act of 1995
regarding prior laying, therefore, the Rule continues to remain in
existence, and in such circumstances, the petitioner has prayed that the
respondent - authorities be directed to issue the Schedule for admission
in Class 2nd to Class 8th by treating Rule 134A of the Rules of 2003 to be
in existence as on date as well. Learned senior counsel for the petitioner
further submits that in accordance with the provision of Section 24 (3) of
the Act of 1995, prior approval of the House of the State Legislature is
necessary and mandatory for bringing into existence any amendment in
the Rules of 2003. He submits that as the amendment has not been laid
before the House of the State Legislature seeking prior approval,
therefore, omission of Rule 134A of the Rules of 2003 has not come into
force, and in such circumstances, since Rule 134A still continues to be in
existence, relief prayed for by the petitioner may be granted.
We have heard learned senior counsel for the petitioner at
length. We have also perused the provision of Section 24 (3) of the Act
of 1995, which is in the following terms :-
"Every rule made under this section shall be laid as soon as
may be after it is made before the House of the State
Legislature while it is in session for a total period of ten
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days which may be comprised in one session or in two or
more successive sessions, and if, before the expiry of the
session in which it is so laid or the successive sessions
aforesaid, the House agrees in making any modification in
the rule or the House agrees that the rule should not be
made, the rule shall thereunder have effect only in such
modified form of be of no effect, as the case may be, so,
however, that any such modification or annulment shall be
without prejudice to the validity of anything previously done
under that rule."
A bare perusal of the aforesaid Section makes it clear that the provision
for laying of the Rules before the House of the State Legislature is not a
provision requiring prior laying but it specifically and clearly states that
the Rule has to be laid before the House of the State Legislature as soon
as may be after it is made. Language of the provision is clear and when
confronted with the same, learned senior counsel for the petitioner fairly
concedes that the aforesaid provision stipulates and provides for laying of
the Rule before the House of the State Legislature as soon as may be after
it is made. In such circumstances, as the provision of the Statute is
directory and not mandatory and does not require prior laying of the
Rule, it is evident that the notification dated 28.03.2022 (P-4) deleting the
provision of Rule 134A from the Rules of 2003 has come into force from
the date it has publication and as on date, Rule 134A does not exist on the
Statute book.
In this regard, the following observations of the Supreme
Court in Jan Mohammad Noor Mohammad Bagban Vs. State of
Gujarat and another, AIR 1966 SC 385 are relevant :-
"18. Finally, the validity of the rules framed under the
Bombay Act 22 of 1939 was canvassed. By Section 26 (1) of
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the Bombay Act the State Government was authorised to
make rules for the purpose of carrying out the provisions of
the Act. It was provided by sub-section (5) that the rules
made under Section 26 shall be laid before each of the
Houses of the Provincial Legislature at the session thereof
next following and shall be liable to be modified or
rescinded by a resolution in which both Houses concur and
such rules shall, after notification in the Official Gazette, be
deemed to have been modified or rescinded accordingly. It
was urged by the petitioner that the rules framed under the
Bombay Act 22 of 1939 were not placed before the
Legislative Assembly or the legislative Council at the first
session and therefore they had no legal validity. The rules
under Act 22 of 1939 were framed by the Provincial
Government of Bombay in 1941. At that time there was no
Legislature in session, the Legislature having been
suspended during the emergency arising out of World War
II. The session of the Bombay Legislative Assembly was
convened for the first time after 1941 on May 20, 1946 and
that session was prorogued on May 24, 1946. The second
session of the Bombay Legislative Assembly was convened
on July 15, 1946 and that of the Bombay Legislative Council
on September 3, 1946 and the rules were placed on the
Assembly Table in the second session before the Legislative
Assembly on September 2, 1946 and before the Legislative
Council on September 13, 1946. Section 26(5) of Bombay
Act 22 of 1939 does not prescribe that the rules acquired
validity only from the date on which they were placed before
the Houses of Legislature. The rules are valid from the date
on which they are made under Section 26(1). It is true that
the Legislature has prescribed that the rules shall be placed
before the Houses of Legislature, but failure to place the
rules before the Houses of Legislature does not affect the
validity of the rules, merely because they have not been
placed before the Houses of the Legislature. Granting that
the provisions of sub-section (5) of Section 26 by reason of
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the failure to place the rules before the Houses of
Legislature were violated, we are of the view that sub-
section (5) of Section 26 having regard to the purposes for
which it is made, and in the context in which it occurs,
cannot be regarded as mandatory. The rules have been in
operation since the year 1941 and by virtue of Section 64 of
the Gujarat Act 20 of 1964 they continue to remain in
operation."
Further, while relying upon the aforesaid decision and considering other
decisions, the Supreme Court in M/s Atlas Cycle Industries Ltd. and
others Vs. The State of Haryana, (1979) 2 Supreme Court Cases 196
observed as under :-
"22. Now at page 317 of the aforesaid Edition of Craies on
Statute Law, the questions whether the direction to lay the
rules before Parliament is mandatory or merely directory
and whether laying is a condition precedent to their
operation or may be neglected without prejudice to the effect
of the rules are answered by saying that "each case must
depend on its own circumstances or the wording of the
statute under which the rules are made." In the instant case,
it would be noticed that sub-section (6) of Section 3 of the
Act merely provides that every order made under Section 3
by the Central Government or by any officer or authority of
the Central Government shall be laid before both Houses of
Parliament, as soon as may be, after it is made. It does not
provide that it shall be subject to the negative or the
affirmative resolution by either House of Parliament. It also
does not provide that it shall be open to the Parliament to
approve or disapprove the order made under Section 3 of
the Act. It does not even say that it shall be subject to any
modification which either House of Parliament may in its
wisdom think it necessary to provide. It does not even
specify the period for which the order is to be laid before
both Houses of Parliament nor does it provide any penalty
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for non-observance of or non-compliance with the direction
as to the laying of the order before both Houses of
Parliament. It would also be noticed that the requirement as
to the laying of the order before both Houses of Parliament
is not a condition precedent but subsequent to the making of
the order. In other words, there is no prohibition to the
making of the orders without the approval of both Houses of
Parliament. In these circumstances, we are clearly of the
view that the requirement as to laying contained in sub-
section (6) of Section 3 of the Act falls within the first
category, i.e. "simple laying" and is directory not
mandatory. We are fortified in this view by a catena of
decisions, both English and Indian. In Bailey v. Williamson,
1873 LR VIII Q B 118 whereby Section 9 of the Parks
Regulations Act, 1872 passed on June 27, 1872 "to protect
the royal parks from injury, and to protect the public in the
enjoyment of those royal parks and other royal possessions
for the purpose of innocent recreation and exercise" it was
provided that any rules made in pursuance of the first
schedule to the Act shall be forthwith laid before both
Houses of Parliament, if Parliament be sitting, or if not, then
within three weeks after the beginning of the then next
ensuing session of Parliament; and if any such rules shall be
disapproved by either House of Parliament within one
month of the laying, such rules, or such parts thereof as
shall be disapproved shall not be enforced and Rules for
Hyde Park were made and published on September 30, 1872
when Parliament was not sitting and in November 18, 1872,
the appellant was convicted under Section 4 of the Act for
that he did unlawfully act in contravention of Regulation 8
contained in the first Schedule annexed thereto by delivering
a public address not in accordance with the rules of the said
Park but contrary to the Statute, and it was inter alia
contended on his behalf that in the absence of distinct words
in the statute stating that the rules would be operative in the
interval from the time they were made to the time when
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Parliament should meet next or if Parliament was sitting
then during the month during which Parliament had an
opportunity of expressing its opinion upon them, no rule
made as supplementing the schedule could be operative so
as to render a person liable to be convicted for infraction
thereof unless the same had been laid before the Parliament,
it was held overruling the contention that the rules became
effective from the time they were made and it could not be
the intention of the Legislature that the laying of the rules
before Parliament should be made a condition precedent to
their acquiring validity and that they should not take effect
until they are laid before and approved by Parliament. If the
Legislature had intended the same thing as in Section 4, that
the rules should not take effect until they had the sanction of
the Parliament, it would have expressly said so by
employing negative language.
23. In Starey v. Graham, (1899) 1 Q B 406, where it was
contended that the Register of Patent Agents Rules, 1889
which had been repealed by Rules of 1890 could not be re-
enacted by mere reference without complying with the
provisions of Section 101, sub-section (4) of 46 and 47 Vict.
c. 57 according to which, a copy of the Rules of 1889 should
also have been laid before both Houses of Parliament in
order to make them valid, Channell, J. said :
I somewhat doubt whether the provisions of
Section 101 are more than directory and whether it is
necessary in any particular case where reliance is
placed on such rules to prove that in fact its
provisions had been complied with.
24. In Jan Mohammad Noor Mohammad Bagban v. The
State of Gujarat, AIR 1966 SC 385, where it was urged by
the petitioner that the rules framed by the Provincial
Government in 1941 in exercise of the powers conferred on
it under Section 26(1) of the Bombay Agricultural Produce
Markets Act (22 of 1939) had no legal validity as they were
not laid before each of the Houses of the Provincial
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Legislature at the session thereof next following as provided
by sub-section (5) of Section 26 of the Act, this Court
rejected the contention and upheld the validity of the said
rules. The following observations made in that case by Shah,
J. (as he then was) on behalf of the Constitution Bench are
apposite:-
The rules under Act 22 of 1939 were framed by
the Provincial Government of Bombay in 1941. At
that time there was no Legislature in session, the
Legislature having been suspended during the
emergency arising out of World War II. The session of
the Bombay Legislative Assembly was convened for
the first time after 1941 on May 20, 1946 and that
session was prorogued on May 24, 1946. The second
session of the Bombay Legislative Assembly was
convened on July 15, 1946 and that of the Bombay
Legislative Council on September 3, 1946 and the
rules were placed on the Assembly Table in the
second session before the Legislative Assembly on
September 1, 1946 and before the Legislative Council
on September 13, 1946. Section 26 (5) of Bombay Act
22 of 1939 does not prescribe that the rules acquired
validity only from the date on which they were
placed before the Houses of Legislature. The rules
are valid from the date on which they are made
under Section 26(1). It is true that the Legislature
has prescribed that the rules shall be placed before
the Houses of Legislature, but failure to place the
rules before Houses of Legislature does affect the
validity of the rules, merely because they have not
been placed before the Houses of the Legislature.
Granting that the provisions of sub-section (5) of
Section 26 by reason of the failure to place the rules
before the Houses of Legislature were violated, we
are of the view that Sub-section (5) of Section 26
having regard to the purposes for which it is made,
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and in the context in which it occurs, cannot be
regarded as mandatory. (Emphasis supplied). The
rules have been in operation since the year 1941 and
by virtue of Section 64 of the Gujarat Act 20 of 1964
they continue to remain in operation.
25. In D. K. Krishnan v. Secretary, Regional Transport
Authority, Chittor, AIR 1956 Andhra 129, where the
validity of Rule 134A of the Madras Motor Vehicles Rules,
1940, made under the Motor Vehicles Act, 1939 empowering
the Regional Transport Authority to delegate its functions to
the Secretary was challenged on the ground that it was not
laid before the Legislature of the Madras State as required
by Section 133(3) of the Act which provided that the rules
shall be laid for not less than fourteen days before the
Legislature as soon as possible after they are made and
shall be subject to such modification as Parliament or such
Legislature may make during the session in which they are
so laid, Sabba Rao, J. (as he then was) after an exhaustive
review of the case law and the text books on constitutional
law by eminent jurists repelled the contention observing as
follows :-
The aforesaid discussion in the text books and
the case law indicate the various methods adopted by
the Parliament or legislature to control delegated
legislation. That control is sought to be effected by
directing the rules or regulations made by the
delegated authority to be laid before the Parliament.
Where the statute makes the laying of the rules
before Parliament a condition precedent or the
resolution of the Parliament a condition subsequent,
there is no difficulty as in the former case, the rule
has no legal force at all till the condition precedent is
complied with and in the latter case, it ceases to have
force from the date of non-compliance with the
condition subsequent.
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Nor can there be any difficulty in a case where
the Parliament or the Legislature, as the case may be,
specifically prescribes the legal effect of non-
compliance with that condition. But more important
question arises when the Parliament directs the laying
of the rules before the Parliament without providing
for the consequences of non-compliance with the rule.
In the case of a statute directing rules to be laid
before the Parliament or the Legislature without any
condition attached, the rule is only directory. Though
the statute says that the rules shall be laid before the
Parliament as the provision in the statute is conceived
in public interests, the dereliction of the duty by the
Minister or other officer concerned in not following
the procedure should not be made to affect the
members of the public governed by the rules.
It may be asked and legitimately too that when
the Parliament to keep its control over delegated
legislation directs that the rules shall be laid before
the Parliament and if that rule is construed as
directory, the object itself would be defeated. But the
Parliament or the Legislature, as the case may be if
they intended to make that rule mandatory, they would
have clearly mentioned the legal consequences of its
non-compliance as they have done in other cases.
This rule [i.e. the one contained in Section
133(3]) therefore, is not made either a condition
precedent or a condition subsequent to the coming
into force of the rules. It does not provide for any
affirmative resolution. The rule continues to be in
force till it is modified by the Parliament.
If sub-section (3) is only directory, in view of
the opinion expressed by us, it is clear from a fair
reading of the words used in the section that the rules
made under the section came into effect immediately
they were published and they continued to be in force
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because it is not suggested that they were modified by
the Legislature. We, therefore, hold that the rule in
question is valid.
26. In State v. Karna, (1973) 24 RLW 487, where the
very question with which we are concerned in the present
case cropped up in connection with the Rajasthan
Foodgrains (Restrictions on Border Movement) Order,
1959, a bench of Rajasthan High Court said as follows:-
It is important to note that laying the Order
before both the Houses of Parliament is not a
condition precedent for bringing into force the Order.
All that sub-section (6) provides is that every Order
made under Section 3 of the Essential Commodities
Act by the Central Government or by any officer or
authority of the Central Government shall be laid
before both the Houses of Parliament as soon as after
it is made. It is significant that the Order is valid and
effective from the date it is duly promulgated. Even
the limit or period within which it must be placed
before the Parliament has not been specified. It is,
therefore, not possible to hold that sub-section (6) of
Section 3 of the Essential Commodities Act is
mandatory. If the Legislature intended that in order to
provide an adequate safeguard it was necessary to
make the said provision mandatory it could have done
so in express words. We are, therefore, of the opinion
that the Order cannot be considered as invalid merely
because the State was not able to put on record proof
of the fact that the Order was laid before both the
Houses of Parliament.
27. In Mathura Prasad Yadava v. Inspector General,
Railway Protection Force, Railway Board, New Delhi,
(1974) 19 MPLJ 373, where it was contended that
Regulation 14 of the Railway Protection Force Regulations,
1966 made under Section 21 of the Railway Protection
Force Act (23 of 1957) was invalid as it was not laid before
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both Houses of Parliament as required by sub-section (3) of
Section 21 of the Act, it was held:
What then is the consequence of failure to lay
the regulation ? . . . A correct construction of any
particular laying clause depends upon its own terms.
If a laying clause defers the coming into force of the
rules until they are laid, the rules do not come into
force before laying and the requirement of laying is
obligatory to make the rule operative. So the
requirement of laying in a laying clause which
requires an affirmative procedure will be held to be
mandatory for making the rules operative, because, in
such cases the rules do not come into force until they
are approved, whether with or without modification,
by Parliament. But in case of a laying clause which
requires a negative procedure the coming into force
of the rules is not deferred and the rules come into
force immediately they are made. The effect of a
laying clause of this variety is that the rules continue
subject to any modification that Parliament may
choose to make when they are laid; but the rules
remain operative until they are so modified. Laying
clauses requiring a negative procedure are, therefore,
construed as directory. The matter is put beyond
controversy by the decision of the Supreme Court in
Jan Mohd. v. State of Gujarat (supra). Our
conclusion, therefore, is that the laying requirement
enacted in Section 21(3) of the Act is merely
directory. It logically follows that failure to lay
Regulation 14 has no effect on its validity and it
continues to be effective and operative from the date it
was made.
28. Relying on the decision in D. K. Krishnan v.
Secretary Regional Transport Authority, Chittoor (supra),
Grover, J. speaking for the bench in Krishna Khanna v.
State of Punjab, AIR 1958 Punj 32 said that sub-section (6)
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of Section 3 of the Essential Commodities Act, 1955 was
merely of a directory nature and its non-compliance did not
render the Punjab Coal Control Order, 1955 invalid or void.
29. Metcalfe v. Cox 1895 AC 328 (HL) (2), where the
Commissioners (charged with the duty of making provisions
for improving the administration of the Scottish
Universities) assuming to act under powers of Section 16 of
the Universities (Scotland) Act, 1889 executed an instrument
in writing declaring that they had affiliated and did thereby
affiliate the University College of Dundee to and make it
form part of the University of St. Andrews which was treated
as an ordinance and held to be invalid on the ground that it
had not been laid before Parliament is not helpful to the
appellants, as the decision in that case turned upon the
construction of the language of Section 20 of the said Act
which provided that all ordinances made by the
Commissioners are to be published in the Edinburgh
Gazette, laid before Parliament and submitted to Her
Majesty, the Queen for approval and no such ordinance
shall be effectual until it shall have been so published, laid
before Parliament and approved by Her Majesty in Council.
30. The decision of this Court in Narendra Kumar v. The
Union of India, AIR 1960 SC 430 on which counsel for the
appellants have heavily leaned is clearly distinguishable. In
that case, the Non-ferrous Metal Control Order, 1958 was
held to be invalid essentially on the ground that the
principles specified by the Central Government in
accordance with Clause 4 of the Order were not published
either on April 2, 1958 on which the order was published in
the Government Gazette or any other date. It would be
noticed that while considering the effect of non-publication
of the aforesaid principles which formed an integral part of
the order by which alone the Central Government could
regulate the distribution and supply of the essential
commodities, it was only incidentally that a mention was
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made by the Court to the effect that the principles had not
been laid before both Houses of Parliament.
31. Likewise the decisions of this Court in Express
Newspapers (Private) Ltd. v. The Union of India, AIR 1958
SC 578 and In re The Kerala Education Bill 1957, AIR
1958 SC 956 are also not helpful to the appellants. The
point involved in the present case was not directly in issue in
those cases and the observations made therein about laying
were merely incidental.
32. From the foregoing discussion, it inevitably follows
that the Legislature never intended that non-compliance
with the requirement of laying as envisaged by sub-section
(6) of Section 3 of the Act should render the order void.
Consequently non-laying of the aforesaid notification fixing
the maximum selling prices of various categories of iron and
steel including the commodity in question before both
Houses of Parliament cannot result in nullification of the
notification. Accordingly, we answer the aforesaid question
in the negative. In view of this answer, it is not necessary to
deal with the other contention raised by the respondent to
the effect that the aforesaid notification being of a
subsidiary character, it was not necessary to lay it before
both Houses of Parliament to make it valid.
The judgment rendered in Atlas Cycle Industries Ltd. case (supra) was
further relied upon by the Supreme Court in Prohibition & Excise
Supdt., A.P. and others Vs. Toddy Tappers Coop. Society, Marredpally
and others, (2003) 12 Supreme Court Cases 738.
Again, the Supreme Court in Bank of India and others Vs.
O.P. Swarnakar and others, (2003) 2 Supreme Court Cases 721, held as
under :-
"125. Secondly, even if the same was a regulation, the
laying-down rule is merely a directory one and not
mandatory.
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126. In Jan Mohammad's case (supra), the law is stated in
following terms:
"18. "Finally, the validity of the rules framed under
the Bombay Act 22 of the 1939 was canvassed. By
Section 26(1) of the Bombay Act the State
Government was authorised to make rules for the
purpose of carrying out the provisions of the Act. It
was provided by sub-section (5) that the rules made
under Section 26 shall be laid before each of the
Houses of the Provincial Legislature at the session
thereof next following and shall be liable to be
modified or rescinded by a resolution in which both
Houses concur and such rules shall, after notification
in the Official Gazette, be deemed to have been
modified or rescinded accordingly. It was argued by
the petitioner that the rules framed under the Bombay
Act, 22 of 1939 were not placed before the Legislative
Assembly or the Legislative Council at the first
session and therefore they had no legal validity. The
rules under Act 22 of 1939 were framed by the
Provincial Government of Bombay in 1941. At that
time there was no Legislature in session, the
Legislature having been suspended during the
emergency arising out of World War II. The session of
the Bombay Legislative Assembly was convened for
the first time after 1941 on 20-5-1946 and that session
was prorogued on 24-5-1946. The second session of
the Bombay Legislative Assembly was convened on
15-7-1946 and that of the Bombay Legislative Council
on 3-9-1946 and the rules were placed on the
Assembly Table in the second session before the
Legislative Assembly on 2-9-1946 and before the
Legislative Council on 13-9-1946. Section 26(5) of
Bombay Act 22 of 1939 does not prescribe that the
rules acquired validity only from the date on which
they were placed before the Houses of Legislature.
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The rules are valid from the date on which they are
made under Section 26(1). It is true that the
Legislature has prescribed that the rules shall be
placed before the Houses of Legislature, but failure to
place the rules before the Houses of Legislature does
not affect the validity of the rules, merely because they
have not been placed before the Houses of the
Legislature. Granting that the provisions of sub-
section (5) of Section 26 by reason of the failure to
place the rules before the Houses of Legislature were
violated, we are of the view that sub-section (5) of
Section 26 having regard to the purposes for which it
is made, and in the context in which it occurs, cannot
be regarded as mandatory. The rules have been in
operation since the year 1941 and by virtue of Section
64 of the Gujarat Act 20 of 1964 they continue to
remain in operation."
127. In Atlas Cycle Industries' case (supra) the same view
has been reiterated.
128. We, therefore, are of the opinion that the scheme in
question cannot be said to be bad in law."
The aforesaid view has been reiterated by the Supreme Court in Veneet
Agrawal Vs. Union of India and others, (2007) 13 Supreme Court
Cases 116, while observing as under :-
"15. This apart the issue relating to the laying down of
rules/regulations on the table of the Houses for the period
provided under the statute under which they are so framed
has been dealt with by this Court in various cases. Some of
these cases are Jan Mohammad Noor Mohammad Bagban
v. State of Gujarat, (supra), Atlas Cycle Industries Ltd. v.
State of Haryana, (supra), Hukum Chand v. Union of
India, (1972) 2 SCC 601, and Bank of India v. O.P.
Swarnakar (supra). In a recent judgment, this Court
followed the view taken in M/s. Atlas Cycle Industries Ltd.
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case (supra) and Prohibition & Excise Suptd., A.P. v.
Toddy Tappers Coop. Society (supra).
16. In all these cases, the issue relating to laying down
and interpretation of the said regulation was examined. It
has been held in all these cases that the laying of the rule
before both the Houses of Parliament is merely a directory
rule and not mandatory. In the Case of O.P. Swarnakar
(supra), the provision providing for laying the rules before
the Legislative was exactly similar to Section 31 of the SEBI
Act. It was also held by this Court that the said provision
was directory and not mandatory. The non-compliance with
the laying of the rule before the Parliament was not a
sufficient ground to declare the rules/regulations framed
under the statute as to be ultra vires. In Toddy Tappers
Coop. Society case (supra) Hon'ble Mr. Justice Sinha in his
concurring judgment following the decision in Atlas Cycle
Industries Ltd. case (supra) and Quarry Owners' Assn. v.
State of Bihar, (2000) 8 SCC 655 and various other
judgments, distinguishing the judgment in Union of India v.
National Hydroelectric Power Corpn. Ltd., (2001) 6 SCC
307, (which has been relied upon by counsel for the
appellant before us as well) has held as under:- (SCC p.
756, para 32)
"32. The said observations, thus, must be held to be
confined to the fact of the matter obtaining therein. In
that case it was found as of fact that the rule had
never been placed before the Legislature and, thus,
there was even no substantial compliance with the
law. The Bench, however, did not consider the effect
of the directory nature of such a provision, in the light
of the decision of this Court in Atlas Cycle Industries
(supra) and Quarry Owners' Assn. (supra). The
Court further did not notice the difference between the
expressions 'approval' and 'permission'. Section 16
of the Water Act, construction whereof was in
question did not use the expression 'prior approval'.
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The word 'approval' indicates an Act which has
already been made and is required to be approved
whereas in the case of 'permission', the situation
would be different. This aspect of the matter has been
considered by this Court in High Court of Judicature
for Rajasthan v. P.P. Singh, (2003) 4 SCC 239
stating : (SCC p. 255, para 40)
'40. When an approval is required, an action
holds good. Only if it is disapproved it losses its
force. Only when a permission is required, the
decision does not become effective till
permission is obtained. (See U.P. Avas Evam
Vikas Parishad v. Friends Coop. Housing
Society Ltd. 1995 Supp (3) SCC 456), In the
instant case both the aforementioned
requirements have been fulfilled."
17. It was observed that provision was merely directory
and not mandatory and even if the rules were not laid before
the House at all even then the non-compliance with the
laying down of the rules before the Parliament could not be
a ground to declare the rules/regulations framed under the
statute as ultra vires.
18. Although in the present case the rules were laid
before both the Houses as required under Section 31, as
discussed in the earlier paragraph of the judgment but even
if it is assumed that the Rules/Regulations in question did
not complete the requisite period of 30 days, the provisions
of Section 31 of the SEBI Act not being mandatory and
merely directory, as has been held by this Court in the
aforementioned cases, the Rules/Regulations cannot be held
to be ultra vires on the ground of non-completion of 30
days' period after laying of the Rules before both the Houses
of Parliament."
In view of the aforesaid legal and factual position, prayer
made by the petitioner to the effect that the respondents may be directed
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to issue the Schedule for admission by applying Rule 134A of the Rules
of 2003 is misconceived and cannot be allowed.
Petition is, accordingly, dismissed.
( RAVI SHANKER JHA )
CHIEF JUSTICE
( ARUN PALLI )
JUDGE
November 15, 2022
ndj
Whether speaking/reasoned Yes/No
Whether reportable Yes/No
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