il Appeals Nos
392 of 1956  686 of 1957
Appeals from the judgment and order dated March 31 1954 of the former Hyderabad High Court in Civil Writ Nos 43 and 44 of 1951 respectively
section P Varma section Mohammed and section R Borgaouker for the appellants in both the appeals
A V Viswanatha Sastri P V R Tatachari and TM Sen for the respondents in both the appeals
Civil Appeal No 392 of 1956
March 16
The Judgment of the Court was delivered by SHAH J
This is an appeal filed with a certificate granted under article 1331c of the Constitution by the High Court of Judicature of the State of Hyderabad
The appellant was a Jagirdar holding jagirs Ramwarm Chandam Palli and Gulla Palli Taluq Sirsalla in the District of Karimnagar in the State of Hyderabad
After the Police Action in August 1948 Major General Chaudary was appointed the Military Governor for the State of Hyderabad
His Exalted Highness the Nizam of Hyderabad invested the Military Governor with authority to administer the State by a Farman dated September 19 1948
The Farman was in the following terms  Whereas the General Officer Commanding in Chief Southern Army has appointed Major General J N Chaudary OBE to be the Military Governor for the Hyderabad State and whereas all authority 313 for the administration of the State now vests in him I hereby enjoin all the subjects of the State to carry out such orders as he may deem fit to issue from time to time
I appeal to all officers of the State administration and subjects of the State to render faithful and unflinching obedience to the Military Governor and conduct themselves in a manner calculated to bring about the speedy restoration of law and order in the State 
On August 7 1949 His Exalted Highness the Nizam issued an explanatory Farman in the following terms  With reference to my Farman dated 19 9 1948 in which I referred to the fact that all authority for the administration of the State now vests in the Military Governor I hereby declare that the said authority includes and has always included authority to make Regulations 
On August 10 1949 the Military Governor promulgated The Hyderabad Abolition of Jagirs Regulation of 1358 Fasli which will hereinafter be referred to as the Abolition Regulation
This Regulation was brought into force on August 15 1949 the date of its publication in the Official Gazette
Section 5 of the Regulation directed that from a date to be notified for the transfer of the administrations of the jagirs in the State to the Government the jagirdars shall make over the management of the jagirs to the Jagir Administrator and in default of compliance therewith the Officer appointed under the Regulation may take forcible possession
By section 6 it was provided that the jagirs shall be included in the  Diwani  and unless and until included in a district shall be administered by the Jagir Administrator and that the powers rights and liabilities in relation to such jagirs shall cease to be exercisable by the jagirdars and shall be exercisable by the Jagir Administrators and that no jagirdar shall recover or receive any customary or other dues from any tenant or resident of the jagir
By section 14 it was declared that the jagirdars were to receive certain interim maintenance allowances until such time as the terms of the commutation of the jagirs were determined
Pursuant to the authority reserved by a 6 of the Abolition Regulation possession 314 of the jagirs was taken over sometime in September 1949 by the Jagir Administrator acting on behalf of the State of Hyderabad
On December 1 1949 another Farman was issued by His Exalted Highness the Nizam which provided as follows  Whereas the General Officer Commanding in Chief Southern Army has as from the 1st December 1949 terminated the appointment of Major General Chaudary OBE to be the Military Governor for the Hyderabad State And whereas it is necessary to make other arrangements for the administration of the State as from the said date Now therefore I hereby appoint as from the said date Mr M K Vellodi CIE ICS to be my Chief Minister and 
I further direct that all the powers of administration vested in the Military Governor before the said date are exercisable by the Chief Minister 
In exercise of the powers vested in him the Chief Minister promulgated the Hyderabad Jagirs Commutation Regulation No XXV of 1359 Fasli which will hereinafter be referred to as the Commutation Regulation
This Regulation was brought into operation on January 25 1950
By section 3 of the Regulation the method of computing the commutation sum for every jagir was prescribed
After the inauguration of the Constitution of India on January 26 1950 on which date the  territory of the State of Hyderabad became part of the Union of India the President on April 25 1950 certified the two Regulations under article 316 of the Constitution by a notification published in the gazette of the Union of India
The Constitution was amended on June 18 1951 by the Constitution First Amendment Act of 1951 whereby inter alia articles 31A and 31B and Sch
IX were incorporated in the Constitution
The Abolition Regulation and the Commutation Regulation were included in Schedule IX and by virtue of article 31B neither the Regulations nor any of the provisions thereof were to be deemed to be void or ever to have become void on the ground that the 315 Regulations were inconsistent with or took away or abridged any of the rights conferred by any of the provisions of Part III of the Constitution
In the meantime the appellant had on January 29 1951 filed a petition in the High Court of Hyderabad for a writ in the nature of mandamus directing the State of Hyderabad and the Jagir Administrator to hand over possession of the appellant s properties and for an order declaring the Abolition Regulation and the Commutation Regulation ultra vires and unconstitutional and for certain interim orders
After the amendment of the Constitution the petition was amended on August 14 1952
By this petition the appellant claimed that sections 41c and 42 of the Commutation Regulation and section 64 of the Abolition Regulation were invalid because by these provisions there was  naked confiscation of the property  of the appellant and that they amounted to  colourable and fraudulent exercise of legislative power 
The High Court of Hyderabad rejected the petition filed by the appellant but certified the case under article 1331c as a fit one for appeal to this court
In this appeal two principal contentions fall to be determined viz 1 whether legislative authority was conferred upon the Military Governor by the Farman dated September 19 1948 and 2 If by the Farman legislative authority was delegated to the Military Governor whether it was circumscribed by any limitations or reservations
Was the Military Governor by the Farman dated September 19 1948 invested with all the sovereign authority legislative executive and judicial of HEH the Nizam or was he merely invested with the executive authority  By the plain words used in the Farman  all authority for the administration of the State was conferred upon the Military Governor and there is nothing in the text of the Farman which warrants the view that only executive authority was intended to be delegated thereby
Within the expression  all administrative authority  is encompassed the entirety of the authority of the sovereign and by the delegation from His Exalted Highness the Nizam the Military Governor was invested with that authority 316 in all its amplitude
The injunction to the subjects of the State to carry out all such orders as the Military Governor may deem fit to issue and the appeal to the officers of the State and the subjects to render faithful and unflinching obedience and to conduct themselves in a manner calculated to bring about the speedy restoration of law and order do not detract from the amplitude of the powers delegated to the Military Governor
The expression  orders  would include every order made in exercise of authority for the administration of the State and the object intended to be achieved viz the speedy restoration of law and order in the State by His Exalted Highness the Nizam as expressed in the appeal was not restrictive of that authority
That His Exalted Highness the Nizam in and before the month of September 1948 was an absolute ruler invested with all authority executive legislative and judicial is indisputable
He had supreme powers vested in him to modify restrict take away or extinguish the rights of any of his subjects and the validity of his actions or orders was not liable to be questioned before any tribunal or authority
The Farman promulgated on September 19 1948 by His Exalted Highness the Nizam delegated his sovereign authority to the Military Governor and to remove all doubts as to the effect of that delegation an explanatory Farman dated August 7 1949 was issued
It was declared in express terms by that Farman that the authority of the Military Governor to included and has always included the authority to make Regulations 
In the clearest terms the author of the Farman proclaimed the content of the authority delegated by him to the Military Governor
The plea rather faintly urged by Mr Varma that the Farman merely recited that the Military Governor had been invested with authority for administration and did not by its own force purport to invest the Military Governor with authority to administer the State is plainly inconsistent with the argument which was advanced in the High Court and the statement of the case filed in this court and was therefore rightly abandoned by him
317 Though by the delegation of authority the Military Governor was invested with all authority of His Exalted Highness the Nizam in the matter of administration of the State in all its departments the sovereignty of His Exalted Highness the Nizam was by this act of delegation undoubtedly not extinguished
It was open to him notwithstanding the delegation to issue orders or Regulations contrary to those which were issued by the Military Governor and also to withdraw the authority of the Military Governor
There is however no evidence on the record to show that after September 19 1948 and before the Abolition Regulation was promulgated the authority of the Military Governor was withdrawn or that His Exalted Highness the Nizam had issued any order or Regulation inconsistent with the Abolition Regulation
The authority of the Military Governor was withdrawn in December 1949 and the Chief Minister was invested with the same authority of administration including expressly the power of legislation and it was in exercise of that authority that the Chief Minister issued the Commutation Regulation
The authority of His Exalted Highness the Nizam as the sovereign ruler to resume the jagirs and to extinguish the interests of the jagirdars being by delegation vested in the Military Governor the legality of the action of the latter was not open to challenge on any test of legislative competence
Assuming that no opportunity had arisen for exercise of the sovereign authority in the matter of resumption of jagirs or extinction of the jagirdars  interests before the promulgation of the Abolition Regulation an inference cannot therefrom arise that His Exalted Highness the Nizam had irrevocably placed a restriction on his sovereignty or that the delegation to the Military Governor of the sovereign authority was subject to an implied restriction that the interests of the jagirdars in the jagirs could not in exercise of the authority be extinguished
The authority of the Military Governor being unrestricted so long as it enured his action in issuing the Abolition Regulation could not be challenged on the plea that it was a colourable exercise of legislative 41 318 authority
The doctrine of invalidity of legislative provisions enacted in colourable exercise of authority applies to legislatures whose powers are subject to constitutional restrictions
When such a legislative body seeks under the guise or pretence of complying with the restrictions in enacting a statute to evade or elude them it is but a fraud on the Constitution and the statute is liable to be declared invalid on the ground that the enactment is in colourable exercise of authority the statute being in truth beyond the competence of the body
But a statute enacted by a legislative authority whose powers are not fettered by any constitutional or other limitations cannot be declared invalid as enacted in colourable exercise of its powers
The authority of the Chief Minister under the Farman dated December 1 1949 in its amplitude was as extensive as that of His Exalted Highness the Nizam and the Commutation Regulation was not liable to be challenged on the ground of want of legislative competence or colourable exercise of legislative authority the power exercised by him being the legislative power as the delegate of the Sovereign
The plea that the fundamental rights of the appellant under the Constitution were infringed by the two Regulations does not require any detailed examination
By virtue of the Abolition Regulation the rights of the appellant as a jagirdar in his jagir were extinguished and by the Commutation Regulation the quantum of compensation payable to him was determined by a pre Constitution legislation
The Regulations were competently promulgated in exercise of legislative authority in that behalf  and the Constitution does not operate retrospectively to revive the rights which had been before it was enacted extinguished
The Constitution has except as otherwise expressly provided no retrospective operation Keshavan Mahava Menon vs State of Bombay 1 and rights which were by legislation extinguished before it was enacted are not revived thereby
At the commencement of the Constitution the appellant had therefore no rights in the jagirs and he obviously could not claim a writ of mandamus directing 1  319 delivery of possession of the jagir or a writ directing commutation otherwise than under the provisions of the Commutation Regulation
It may also be observed that the Parliament has by the Constitution 1st Amendment Act included the Abolition and the Commutation Regulations in the ninth schedule and by virtue of article 31B the two Regulations are exempt from challenge on the ground that they are inconsistent with or take away or abridge any of the fundamental rights conferred by Part III of the Constitution
The appeal therefore fails and is dismissed with costs
Civil Appeal No 686 of 1957
This appeal raises the same question which has been decided in the companion Appeal No 392 of 1956 and for reasons set out therein this appeal must fail and is dismissed with costs
Appeals dismissed


Summary:
The question for determination in these appeals was whether and to what extent the municipal activities of the Corporation of 943 Nagpur City fell within the term industry  as defined by section 2 14 of the CP and Berar Industrial Disputes Settlement Act 1947
Disputes having arisen between the said Corporation and its employees in its various departments the State Government referred them for adjudication to the State Industrial Court under section 39 of the Act and that Court by its award held that the Corporation and all its departments were covered by the said definition
Against that award the Corporation made an application to the High Court under article 26 of the Constitution
The High Court rejected its contention that the Corporation was not an industry within the meaning of the said section and remanded the case to the Industrial Court for determination as to which of its departments fell within the definition and making an award accordingly
Thereafter The Industrial Court found all the departments of the Corporation except those dealing with 1 assessment and levy of house tax 2 assessment and levy of Octroi 3 removal of encroachment and removal and pulling down of dilapidated houses 4 prevention and control of food adulteration and 5 maintenance of cattle pounds to be industries within the meaning of the definition and passed its award accordingly
The Corporation appealed to this Court by special leave but there was no appeal on behalf of the employees of the five departments excluded from the definition
Held that the decision of the Industrial Court except so far as it related to the five departments in respect of which the re was no appeal must be affirmed
The definition of the word industry  in section 2 14 of the CP and Berar Industrial Disputes Settlement Act 1947 although in a language somewhat different from that of section 2 1 of the  is very comprehensive
It is in two parts cl
a defines it from the standpoint of employers and cl
b from that of the employee
An activity that falls within any of the two clauses must be in industry
DN Banerji vs P R Mukherjee  and Baroda Borough Municipality vs Its Workmen
  applied
It is not necessary that an activity of the Corporation must share the common characteristics of an industry before it can come within the section
The words Of section 2 14 of the Act are clear and unambiguous and the maxim noscitur a socii can have no application
The history of industrial disputes and the legislation however recognises the basic concept that the activity must be an organised one and not one that pertains to private or personal employment
State of Bombay vs The Hospital Mazdoor Sabha
 and Heydon s Case b referred to
But the definition however wide cannot include the regal primary and inalienable functions of the State though statutorily delegated to a corporation and the ambit of such functions cannot be extended so as to include the welfare activities of a modern state and must be confined to legislative power administration of law and judicial power
120 944 Richard Coomber vs The Justices of the County of Berks Berks1883 84 9 AC 61 and The Federated State School Teachers  Association of Australia vs The State of Victoria
  County Council of Middlesex vs Assessment Committee of St George s Union
1896 2 QBD 143 Verisimo Vasquez Vilas vs City of Manila 220 U section 345 and The Federated Municipal and Shire Council Employees  Union of Australia vs Mclbourne Corporation
  referred to
The real test as to whether a service undertaken by a corporation is an industry must be whether that service if  performed by an individual or a private person would be an industry
Monetary cosideration cannot be an essential characteristic of industry in a modern State
It was therefore incorrect to say that only such activities as were analogous to trade or business could come within section 2 14 of the Act
D N Banerji vs PR Mukherjee   explained
The Federated Municipal and Shire Council Employees  Union of Australia vs Melbourne Corporation
19l8 19   Federated Engine Drivey and Fireme s Association and Ors
vs The Broken Hill Proprietary Company Limited and Ors
5 and The Federated State School Teachers  Association Australia vs The State of Victoria   referred to
Where a service rendered by a Corporation is an industry the employees of the departments connected with that service whether financial administrative or executive would be entitled to the benefits of the Act
Baroda Borough Municipality vs Its Workmen
1957 SCR 33 referred to
If a department of a municipality discharges many functions some within and some without the definition of industry given by the Act the predominant functions of the department shall be the criterion for the purposes of the Act