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Showing contexts for: article 299 in Ghosh Singh Partners Ltd. vs Union Of India (Uoi) on 28 March, 1958Matching Fragments
12. It is true that in the case I have just referred to the Supreme Court was not dealing with Section 175(3) of the Government of India Act, 1935, but was dealing with Article 299(1) of the Constittution and that even with Article 299(1), it was dealing not directly, but only incidentally. The question before the Supreme Court was whether by reason of the provisions of Section 7(d) of the Representation of the People Act, the appellant before them was a person disqualified for being chosen as, and for being, a member of Parliament on the ground that he had himself had a share or interest in a contract for the supply of goods to the Central Government. It will be noticed that all that Section 7(d) requires is a share or interest in a contract for the supply of goods to the appropriate Government and not that the Government concerned should be bound by the contract and it should be enforceable against it. The Supreme Court found on the facts that the contracts with which the appellant before them had been concerned were contracts for the supply of goods to the Central Government and that finding, as they pointed out, was sufficient to bring the appellant within the mischief of Section 7(d) of the Representation of the People Act. The Court, however,' did deal with an argument on Article 299(1), of the Constitution addressed to them and did pronounce on the effect of the Article, although they may not have made a comprehensive declaration.
14. With regard to the contracts before them, the Supreme Court held that although they were not altogether void, being binding on the officer who had entered into them on Government's behalf, they were not binding on Government themselves, although Government would perhaps be bound, if they ratified the contracts. Where there was no question of ratification, the contracts, as such, could not be enforceable against Government by reasons of the provisions of Article 299(1), and, necessarily, Government could not be sued on them. It appears to me that in view of these observations of the Supreme Court to the effect that a contract not satisfying the requirement of Article 299(1), would not bind the Union of India, it must be held that a contract not in compliance with Section 175(3) would, similarly, not bind the Governor-General of India and now the Union of India.
15. I confess that I do feel some difficulty, which I have expressed on other occasions and which arises out of certain further observations made by the Supreme Court in the same case. While holding that contracts not complying with Article 299(1), would not bind the Union Government, the Supreme Court also observed that Section 230(3) of the Indian Contract Act would apply to, contracts of that character and that the case of such contracts was exactly the kind of case that Section 230(3) was designed to meet. This observation, causes some doubt as to what the real view of the Supreme Court was as to the effect of such contracts, so far as Government were concerned. As I have observed in another case, if Section 230(3) applies, it can apply only if there be a liability of the principal under the contract and if such a Eability of the Government could arise under a contract, although it did not comply with the requirements of Article 299(1), , it would seem to be implied that the provisions of the Article were not mandatory, Where an agent is sued under Sub-section (3) of Section 230, he is sued on the basis of not any liability of his own or any contract, entered into by himself on his own behalf, but in respect of the liability of his principal who, for some reason or other, cannot be sued, that is to say, cannot be proceeded against or brought before the Court. Section 230(3), I venture to think, applies only to a case where the principal, being liable, cannot, for some reason or other, be sued, but not also to a case where the principal cannot be sued, because in law he is not liable under the contract at all. The Supreme Court observed more than once that the effect of the technical flaw in the the contracts before them was that the principal could not be sued upon them, but they added that the contracts could be enforced under Section 230(3) of the Indian Contract Act against the Officer who had actually entered into the contracts and who was Government's agent. This view would seem to imply that non-compliance with the provisions of Article 299(1), would not prevent a liability of the Government arising, but if a liability did arise, it is not too clear what the reason for the inability to sue Government on the contract could be. The full implications of the decision of the Supreme Court will perhaps be considered when a proper occasion arises, but it appears to me that even on the basis that all that the Supreme Court held was that Government could not bo sued on a contract, not complying with the provisions of Article 299(1), , the case of the appellant must fail. Whether or not the contract was void against the Governor-General and, equally, whether or not it was void as against the Union of India, it is sufficient to note that if, the Union of India cannot be sued on it, it cannot also be taken to arbitration. It must, therefore, be held on the authority of the decision of the Supreme Court that the appellant was not entitled to enforce the agreement as against the Union of India so as to compel them to go to arbition any more than it could sue them upon the contract.
19. In my opinion, there is a great deal at difference between Section 40 of the Ninth Schedule to the Government of India Act, 1935 and Article 166(1) of Constitution, on the one hand, and Section 175(3) of the Government of India Act, 1935, on the other. The difference was pointed out by the Supreme Court in the case to which I have already referred. "None of these provisions," observed the Supreme Court, "is quite the same" as Article 299(1), . Indeed, as Mukherjea, J., himseli pointed out in the very judgment on which the appellant relied. Article 166(1) did not lay down how nn executive action of the Government or a State was to be performed, but only prescribed the mode in which such act was to be expressed. Section 175(3) of the Government of India Act, on the other hand, lays down not merely how a contract entered into in exeicisc of the executive authority of the Federation or a Province is to be expressed, but also how, by whom and in what manner, it is to be entered into, if it is to bind the Government. In one case, the subject-matter of the provision is the expression in language of an act otherwise done, but in the other case, it is the performance of the act itself, though its expression also is combined therewith. The reasons which justify the view that provisions like Section 40(1) of the Ninth Schedule to the Government of India Act, 1935 and Article 166(1) of the Constitution are directory do not, in my view, apply to provisions like Section 175(3) of the Government of India Act, 1935, or Article 299(1), of the Constitution.