Damyanti Naranga v Union of India (1971)

For a labour law paper this is not a trade union case at all on its facts — it concerns a literary society — and that is precisely why it is set. It fixes the content of the freedom guaranteed by Art. 19(1)(c), on which the whole law of trade unions and of collective bargaining rests.

The proposition established is that the right to form associations or unions is not spent at the moment of formation. It carries with it the right to continue the association with the composition that its members voluntarily agreed upon. A law which forces members into an association without the existing members having any option to keep them out, or which strips membership from those who voluntarily joined, violates Art. 19(1)(c).

Read against the union statutes in this Unit, the case supplies the constitutional answer to any question about compulsory amalgamation of unions, statutory imposition of members or office bearers, or a law that alters a union's composition from outside. It also supplies, in its closing pages, a sharp illustration of what a "reasonable restriction" is not: regulation of management is one thing, total deprivation quite another.

In 1910 some eminent educationists assembled at Banaras and founded an association for the development of Hindi and its propagation throughout the country, named the Hindi Sahitya Sammelan. On 8 January 1914 it was registered as a society under the Societies Registration Act 1860, with its head office at Allahabad.

Its rules and bye-laws laid down its objects and the manner of its working. It had three classes of members — special members (Vishisht Sadasya), permanent members (Sthayi Sadasya) and ordinary members (Sadharan Sadasya) — and, apart from the original members, further members could be admitted in these three classes on being elected by the Working Committee of the Society. The rules provided for a Governing Body, a Working Committee, a Hindi University Council, a Literary Council, a Library Committee and other bodies. Through these the Society carried on the development and propagation of Hindi, the spread of the Devnagri script, the holding of examinations and the conferring of degrees for proficiency in Hindi. It owned landed properties and buildings at Allahabad and elsewhere and held considerable funds.

The Society worked very successfully for a number of years. In 1950 differences arose between its members over an attempt to alter its constitution; one section wanted the alterations and another opposed them. Three suits were instituted in the civil courts at Allahabad, injunctions were sought, and ultimately a Receiver was appointed.

In these circumstances the U.P. Legislature passed the U.P. Hindi Sahitya Sammelan Act 1956, creating a statutory body of the same name to which the management and properties of the registered Society were to pass. The Allahabad High Court declared that Act void: it had made the original Sammelan cease to exist and provided for a new Sammelan in whose constitution the members of the original body had no say, thereby infringing their right under Art. 19(1)(c), and it was not saved by Art. 19(4).

Parliament thereupon passed the Hindi Sahitya Sammelan Act 1962, legislating under Entry 63 of List I. Section 2 contained the declaration required for competence under that Entry: "Whereas the objects of the institution known as the Hindi Sahitya Sammelan which has its head office at Allahabad are such as to make the institution one of national importance, it is hereby declared that the institution known as the Hindi Sahitya Sammelan is an institution of national importance."

The Act defined "Sammelan" to mean the institution incorporated under the Act, and "Society" to mean the registered body at Allahabad. Section 4(1) constituted the Sammelan, to consist of its first members and all persons who might thereafter become members in accordance with the rules made in that behalf; by s. 4(2) it was a body corporate with perpetual succession and a common seal, with power to acquire, hold and dispose of property and to sue and be sued.

The first members were originally defined by s. 4(4) as those who immediately before the appointed day were special members or life members of the Society, had been its Presidents, or had been awarded the Mangla Prasad Paritoshik by it. Section 4(4) was amended retrospectively by Act 1 of 1963 to make the first members all persons who immediately before the appointed day were members of the Society, all who before that day had been its Presidents, and all who before that day had been awarded the Mangla Prasad Paritoshik.

The Act vested in the Sammelan all property of the Society, movable and immovable, transferred to it all the Society's rights and liabilities, and converted references to the Society in any law into references to the Sammelan.

The Act itself made no provision for future membership. By s. 12(1)(a) the first Governing Body was directed to make rules on matters relating to membership, including qualifications and disqualifications. That first Governing Body was to be constituted by the Central Government by notification under s. 8, and was to consist of a Chairman, a Secretary and thirteen other members — one representing the education Ministry, one the finance Ministry, not more than three from among former Presidents of the Society, and the remainder from persons who in the opinion of the Central Government were eminent in the field of Hindi language or literature. The rules were to take effect only on approval by the Central Government, and a copy was to be laid before each House of Parliament. Under s. 7(2) the Governing Body of the new Sammelan was to consist of such number, not exceeding fifty-five, as the Central Government might determine, of whom not more than seven were to be nominated by the Central Government.

Rules had in fact been framed and came into force on 1 February 1971, long after both petitions were moved. Rule 6 made members of persons becoming Sabhapatis of the Sammelan for later annual sessions and of later recipients of the Mangala Prasad Paritoshik; Rules 7, 8 and 9 allowed new Vishisht, Sthayi and Sadharan Sadasyas to be admitted on payment of Rs. 1,000 or Rs. 300 as the case might be, admission being by the new Karya Samiti and not by the Working Committee of the original members; Rule 11 made the Central Government's nominees on the Governing Body members of the Sammelan; and Rule 10 allowed educational institutions to be admitted as Sanstha Sadasyas, each with a representative entitled to participate in the proceedings and exercise all the rights of a member.

The writ petition under Art. 32 was filed by a single member of the Society. The petition in the Allahabad High Court, and the appeal from its dismissal, were brought by the original Hindi Sahitya Sammelan together with seventy-two of its members, including members of its Working Committee and Governing Body.

The High Court dismissed the writ petition, holding that since all the members of the Society had also become members of the Sammelan under the Act there was no infringement of the right to form an association.

The respondents' case in the counter-affidavits was that the Act deprived the Society and its members of nothing they had under its constitution; that Parliament, having declared the Society an institution of national importance, legislated in respect of it under Entry 63 so that its administration might not suffer from the quarrels among its members; that the first Governing Body was constituted to take over the management temporarily; and that the Society was never dissolved but converted from a registered body into a statutory Sammelan. In argument, however, counsel for the Union took a different position in the forefront — that the Act keeps the Society intact and creates a new Sammelan to manage the institution — falling back on the counter-affidavit case in the alternative.

Examining the Act, the Court found that the Sammelan is composed not only of persons who were members of the Society but of others given the right to be members without the consent of the pre-existing members. Even under the amended s. 4(4), past Presidents and past recipients of the Mangla Prasad Paritoshik were added "without any option being available to the existing members of the Society to elect or refuse to elect them as members which was the right they possessed under the constitution of the Society itself."

The vice went deeper. Under s. 12(1)(a) very wide powers were given to the first Governing Body over membership, and under that power the rules framed could provide for the admission of "persons as members whom the original members of the Society may never have liked to admit in their Society". The number of such new members "could even be so large as to leave the original members in a small minority with the result that those members could become totally ineffective in the Society." The rules actually framed bore this out, admission being placed in the hands of the new Karya Samiti, with further members entering through the Central Government's nominations and through institutional membership.

The conclusion was that "the Sammelan, which has come into existence under the Act, is not identical with the Sammelan which was registered as a Society under" the Societies Registration Act 1860. Admission of future members was no longer at the choice of the original members who had formed the association. That, the Court held, is "clear interference with the right to form an association which had been exercised by the members of the Society by forming the Society with its constitution, under which they were members and future members could only come in as a result of their choice by being elected by their Working Committee." The Court was therefore unable to agree with the High Court that the new Sammelan was identical with the Society.

It was argued that the right is only to form an association, so that regulation of its affairs afterwards is no breach. The Court accepted the settled position that once an association has been formed its members "they have no right to claim that its activities must also be permitted to be carried on in" the manner they desire, but held those cases inapplicable. "The Act does not merely regulate the administration of the affairs of the Society, what it does is to alter the composition of the Society itself". The consequence is that the members who voluntarily formed the association "are now compelled to act in that Association with other members who have been imposed as members by the Act and in whose admission to membership, they had no say."

Hence the central proposition: "The right to form association necessarily implies that the persons forming the society have also the right to continue to be associated with only those whom they voluntarily admit in the association." And therefore "Any law by which members are introduced in the voluntary association without any option being given to the members to keep them out", or any law which takes away the membership of those who have voluntarily joined it, is a law violating the right to form an association.

The reason given is one to reproduce in an examination. If the right were confined to the initial stage of forming an association, "the right would be meaningless because, as soon as an Association is formed, a law may be passed interfering with its composition" so that the association may not be able to function at all. The right can be effective only if it includes "the right to continue the association with its composition as voluntarily agreed upon by the persons forming the association."

Two authorities were invoked. In O.K. Ghosh v E.X. Joseph the Court had struck at Rule 4-B of the Central Civil Services (Conduct) Rules 1955, which forbade a Government servant to join or continue to be a member of a Service Association which had not obtained recognition within six months of its formation or whose recognition had been refused or withdrawn. That rule, it was there held, "virtually compels a Government servant to withdraw his membership of the Service Association of Government Servants" when recognition is withdrawn or not accorded; in other words, "the right to form an Association is conditioned by the existence of the recognition of the said Association by the Government." The present Court read that as accepting that members may not be compelled to resign by such a condition, and as supporting the view "that the right to form an Association includes the right to its continuance and any law altering the composition of the Association compulsorily will be a breach of the right to form the Association."

The second was State of Madras v V.G. Row, which, though the point was not brought out in plain words, was decided on the basis that persons forming an association have a right under Art. 19(1)(c) "to see that the composition of the Association continues as voluntarily agreed to by them". The principle had been clearly formulated in the High Court by Rajamannar C.J., who said of the word "form" in the Article that it "must refer not only to the initial commencement of the association, but also to the continuance of the association as such."

Under Art. 19(4) reasonable restrictions on the right may be imposed only in the interests of the sovereignty and integrity of India, or in the interests of public order or morality. It had not been contended, and could not be contended, that the alteration of the constitution of the Society effected by the Act was in any of those interests. Not being protected by Art. 19(4), the provision reconstituting the Society into the Sammelan was void; and once that provision fell, the whole Act became ineffective, "inasmuch as the formation of the new Sammelan is the very basis for all the other provisions contained in the Act."

Counsel for the Union then argued that the Act nowhere says the Society stands dissolved, so that the Society continues in its original form while a new Sammelan comes into existence to which its functions and properties have passed. The Court gave three reasons for rejecting this.

First, it was contrary to the specific case taken in the counter-affidavits, namely that the Act reconstitutes the Society and does not create a separate and independent body.

Second, legislative competence. The constitution of societies falls in the State List; Parliament acted under Entry 63 of List I on the strength of a declaration, and the institution declared of national importance was the Society itself. The Court accepted that there may be cases where a society runs a college or school which Parliament may declare of national importance without declaring the society as such; but here s. 2 declared the Society itself. On the alternative reading, the Act keeps the Society intact but transfers its functions and properties to a new body corporate which "has never been declared as an institution of national importance", so that "Parliament was, therefore, not competent to legislate in respect of this newly constituted Sammelan".

Third, property. On that reading the Act takes away all the properties of an existing Society and gives them to "a new, separate and distinct legal entity from the Society". A law depriving the Society of its properties altogether "cannot be held to be a reasonable restriction in the public interest on the right of the Society to hold the property". Under s. 5 of the Societies Registration Act the property vested in the Governing Body, whose members therefore had the right to hold it and were rightly before the Court.

The respondents' reliance on The Board of Trustees, Ayurvedic and Unani Tibia College, Delhi v State of Delhi failed, because there the Board in which the property had vested was itself dissolved by the impugned Act and the property did not thereafter vest in the members of the society, so that no one could complain. Here the argument was being tested on the assumption that the old Society still exists, and "If the Society still exists, so does its Governing Body in whom the property of the Society vested."

The Court closed this branch with the distinction that matters: it was true that litigation was going on and "the affairs of the Society were probably in a mess", but "The remedy, however, could not lie in depriving the Society of its property altogether." Reasonable restrictions could have been imposed to ensure the proper preservation and management of the property. "If the law is passed not merely for ensuring proper management and administration of the property, but for totally depriving the persons, in whom the property vested, of their" right to hold the property, then "the law cannot be justified as a reasonable restriction under Art. 19(5)."

The Hindi Sahitya Sammelan Act 1962, in so far as it interferes with the composition of the Society in constituting the Sammelan, violates the right of the original members to form an association guaranteed by Art. 19(1)(c), and is not saved by Art. 19(4); the whole Act falls with that provision. On the alternative construction the Act is bad for want of legislative competence and for contravention of Art. 19(1)(f), the deprivation not being a reasonable restriction under Art. 19(5). The petition and the appeal were both allowed with costs, the Act was declared invalid, and the concerned bodies including the Union Government were restrained from taking or continuing any action under it.

The right guaranteed by Art. 19(1)(c) is not confined to the initial act of forming an association. It includes the right to continue the association with the composition voluntarily agreed upon by those who formed it, and therefore the right to be associated only with those whom they voluntarily admit. A law which introduces members into a voluntary association without giving the existing members any option to keep them out, or which takes away the membership of those who voluntarily joined, infringes the right; regulation of the association's administration is permissible, alteration of its composition is not. Such a law can be saved only if it falls within the grounds in Art. 19(4). A statute that, on its own alternative construction, leaves a society in existence but transfers all its property to a new legal entity effects a total deprivation which cannot be a reasonable restriction under Art. 19(5); and a declaration of national importance in respect of a society does not confer competence to legislate for a distinct body that was never so declared.