KRISHNAN NAIR Vs. SUB REGISTRAR CHEMENCHERY

JUDGEMENT

(1.) The validity of the Kerala Chitties Act 1975 has been canvassed in these writ petitions. Shri P. K. Appa Nayar led the attack with arguments on O.P. No. 974 of 1976. No separate arguments were advanced in any of the other writ petitions which were posted along with it. In two of them, Counsel merely associated themselves with the argument of Sri Appa Nayar. In the others, not even that was done and their fate was left to rest on the decision in Sri Appa Nayar's case. Arguments advanced were, we should think, quite feeble and insufficient to hold the Act to be unconstitutional.

(2.) The Act has been passed with the assent of the President. By S.70 thereof the provisions of the Act, except certain specified sections shall "so far as may be" apply to chitties started before the commencement of the Act in the Malabar District known to the States Reorganisation Act. Based on this provision making the Act applicable to pre existing chitties, the argument advanced was that chitties are essentially contracts primarily intended to operate for advancing loans from a common fund to the subscribers, that they are regulated and governed by the provisions of the Indian Contract Act; and when the Chitties Act of 1975 seeks to apply its provisions even to chitties started before the commencement of the Act, there is, an usurpation of the field covered by an existing law made by the Parliament viz. the Indian Contract Act, and therefore to that extent the law is invalid. There is a further line of attack: that though entrenched the Act in the Ninth Schedule and protected by Art.31 B, is still open to attack for violation of fundamental right and basic structure of the Constitution.

(3.) That the Chitties Act by S.6, 7, 8,10, 13,14, 16 and 20 and various other Sections, tends to regulate the conduct of chitties is clear enough. This is said to amount to an usurpation by a State Legislature of a jurisdiction that does not belong to it. That the power of legislation in this sphere is to be traced into Entry 7 of List III of the Constitution was beyond dispute. Both the Counsel for the petitioners and the learned Advocate General were agreed on the point. Entry 7 of List III of the Seventh Schedule to the Constitution reads: