Summarize the following court judgment. ns Nos. 108 and 174 177 of 1976. (Under Article 32 of the Constitution of India). R. K. Garg	 section C. Agarwala & Aruneshwar Gupta for the petitioners in WP 108 Somnath Chatterjee	 P. K. Chatterjee & Rathin Das for the petitioners in 174 77 section V. Gupte	 Attorney Genl.	 U. R. Lalit	 R. N. Sacluhey & A. Subhashini for r. 2 in all the WPs. section V. Gupte	 Attorney Gent. & D. N. Mishra for rr. 2 & 3 in WP 108 and rr. 2 4 in WP 174 77. P. section Khera for the Intervener (AIN LIC Employees Federation) The following Judgments were delivered BEG	 C.J. The Life Insurance Corporation was constituted under the Life Insurance Corporation Act 31 of 1956 (hereinafter to be referred to as "the Act"). On 1 6 1957	 the Central Government issued	 under section 11 (1) of the Act	 an order prescribing the 'Pay scales	 dearness allowance and conditions of service applicable to Class III and IV employees. Among these conditions it is	 stated that no bonus would be paid but amenities like insurance and medical treatment free of cost would be provided. On 26 6 1959	 an order was passed by the Central Government under section 11(2) of the Act	 amending para 9 of the 1957 Order inasmuch as it was provided that bonus other than profit sharing bonus would be paid to the employees drawing the salary not exceeding Rs. 5001 per month. On 2nd of July 1959	 there was. a settlement between the L.I.C. and the employees providing for payment of cash bonus at the rate of one and a half month 's basic salary which was to be effective from 1 9 1956 and valid upto 31 12 1961. In July 1960	 regulations were framed under section 49 to regulate the conditions of service of classes of employees and regulation 58 provided for payment of non profit sharing bonus to the employees. Orders were again passed on 14 4 1962 and 3rd August 1963	 the effect of which was to remove the restriction of Rs. 5001 for eligibility for payment of bonus. On 29th January 1963	 another settlement was arrived at between the L.I.C. and its employees for payment of cash bonus at the rate of one and a half month 's basic salary. This was to continue in operation until 31st March 1969. On 20th June 1970	 a third settlement was reached for payment of cash bonus at the same rate which was to be effective upto 31st March 1972. On 26 6 1972	 a fourth settlement for payment of cash bonus at the rate of 10 per cent of gross wages (basic and special pay and dearness allowance) was made effective from 1st 'April 1972 to 1973. On 21st January 1974 and 6th February 1974	 settlements for payment of cash bonus at 15 per cent of gross wages	 valid for four years from 1st April 1973 to 31st March 1977	 were reached. It is clear that this so called "bonus" did not depend upon profits earned but was nothing short of increas 340 ed wages. The settlements were approved by the Board of Directors of the L.I.C. and also by the Central Government. On 29th March	 1974	 a circular was issued by the L.I.C. for payment of bonus in accordance with the settlement along with the salary in April. In April 1974	 the payment of bonus for the year 1973 74 was actually made in accordance with the settlement. Again	 in April 1975	 *bonus for the year 1974 75 was made in accordance. with the settlements. On 25th September 1975	 however	 a Payment of Bonus Amendment Ordinance was promulgated. On 26 9 1975	 the L.I.C. issued a circular stating that	 as the payment of bonus was being reviewed in the light of the Ordinance	 and	 on 22nd of March	 1976	 payment of bonus for the year 1975 76 was to	 be withheld until a final decision was) taken. Against this	 a writ petition was filed in the; High Court of Calcutta. On 21st May 1976	 the Calcutta High Court passed an order recognising the right of petitioners to payment of bonus for the year 1975 76 which had become payable along with the salary in April 1976 and ordered that it must be paid to the employees. Apparently	 bonus was treated as part of the right of the petitioners to property protected by Article 19( and 31(1) of the Constitution. On 29th May 1976	 the Life Insurance Corporation Modification of Settlement Act 1976 was enacted by Parliament denying to the petitioners the right which had been recognised by the settlements	 approved by the Central Government and acted upon by the actual payment of bonus to the employees	 and	 finally	 converted into right under the decision of the Calcutta High Court on 21st May 1976. Provisions. of section 1 1 (2) may read as follows "(2) Where the Central Government is satisfied that for the purpose of securing uniformity in the scales of remuneration and the other terms and conditions. of service applicable to employees of insurers whose controlled busi ness has been transferred to	 and vested in	 the Corporation	 it is necessary so to do	 or that	 in the interests of the Corporation and its policy holders		 a reduction in the remuneration payable	 or a revision of the other terms and conditions of service applicable	 to employees or any class of them is called for	 the Central Government may	 notwithstanding anything contained in sub section (1)	 or in the 	 or in any other law for the time being in force	 or in any award	 settlement or agreement for the time being in force	 alter (whether by way of reduction or otherwise) the remuneration and the other terms and conditions. of service to such extent	 and in such manner as it thinks fit; and if the alteration is not acceptable to any employee	 the Corporation may terminate his employment by giving him compensation equivalent to three months ' remuneration unless the contract of service with such employee provides for a shorter notice of termination. Explanation : The compensation payable to an employee under this sub section shall be in addition to	 and shall not affect	 any pension	 gratuity	 provident fund money 341 or any other benefit to which the employee may be entitled under his contract of service. " Section 1 1 (2) of the Act shows that the Central Government had ample power to revise the scales of remuneration and other terms and conditions of service if it was satisfied that the interest of the Corporation or the policy holders demanded this. Of course	 such orders had to be passed as a result of satisfaction upon material placed before the Central Government relating to the interests of the Corporation or its policy holders. But	 no such order was passed. What was actually done was that the Act was passed to set aside the terms of the settlements which had been incorporated in the Judgment inter parties of the Calcutta High Court. The objects and reasons of the Act were set out as follows "The provisions of the do not apply to the employees employed by the Life Insurance Corporation of India. However	 the Corporation has	 as a matter of practice	 been paying bonus to its employees. The bonus to Class I and Class II employees is being paid in pursuance of agreements between the Corporation and such employees. The bonus to Class III and 	Class IV employees is being paid under the terms of settlement arrived at between the Corporation and such employees from time to time. In terms of the settlement arrived at between the Corporation and its Class III and class IV employees on 24th January	 1974 under the 	 which is in force upto the 31st March	 1977	 bonus is payable by the Corporation to its Class III and Class IV employees at the rate of fifteen per cent	 of their annual salary without any maximum limit. It is proposed to set aside	 with effect from the 1st April	 1975	 these provisions of the settlement arrived at between the Corporation and its Class III and Class IV employees on 24th January	 1974 to enable the Corporation to make ex gratia payments to such employees at the rates determined on the basis of the general Government policy for making ex gratia payments to the employees of the non competing public sector undertakings. The bill seems to	 achieve the above object. " The statement of objects and reasons discloses that the purpose 	of the impugned Act was to undo settlements which had been arrived at between the Corporation and Class III and Class IV employees on January 24 and February 6	 1974	 and actually recognised by the order of the Calcutta High Court. The question could well arise whether this was really the exercise of a legislative power or of a power comparable to that of an appellate authority considering the merits of what had passed into a right to property recognised by the This Court has decided in Shrimati Indira 342 Narain(1) that even a constitutional amendment cannot authorise the assumption of a judicial power by Parliament. One of the tests laid down there was whether the decision is of a kind which requires hearing to be given to the parties	 or	 in other words	 involves at least a quasi judicial procedure	 which the Parliament does not	 in exercise of its legislative power	 follow. A decision reached by the Central Government	 under section 11(2) of the Act	 is the result of a satisfaction on matters stated there and would imply quasi judicial procedure where the terms of a settlement had to be reviewed or revised. But	 the legislative procedure	 followed here	 does not require that to be done. It would	 in any event	 be unfair to adopt legislative procedure to undo such a settlement which had become the basis of a decision of a High Court. Even if legislation can remove the basis of a decision it has to do it by an alteration of general rights of a class but not by simply excluding two specific settlements between the Corporation and its employees from the purview of the section 18 of the 	 which had been held to be valid and enforceable by a High Court. Such selective exclusion could also offend Article 14. If Parliament steps in to set aside such a settlement	 which the Central Government could much more reasonably 'have examined after going into the need for it or for its revision	 the question also arises whether it violates the fundamental right to property guaranteed under Article 19 (1 ) (f ) of the Constitution	 inasmuch as the right to get bonus is part of wages and	 by its deprivation	 a judicially recognised right to property is taken away and not saved by the provisions of Article 19 (6) of the Constitution? A restriction upon a right may even cover taking away of the right to increased remuneration in the interests of the general public. Where was the question of any restriction here in the interests of the general public ? it seems a pure and simple case of a deprivation of rights of Class III and Class TV employees without any apparent nexus with any public interest. The first hurdle in the way of this attack upon the Act undoing the settlement under Article 19 (1) (f) of the Constitution placed before us what that the Act of 1976 notified on 29 5 1976 was passed during the emergency. Hence	 it was submitted that Article	 358 of the Constitution is an absolute bar against giving effect to any right arising under Article 19 of the Constitution. Furthermore	 it was submitted that the effect of the Act was to wash off. the liability altogether after 1 4 1975 so that nothing remained to be enforced after 1 4 1975. The Act is a very short one of 3 sections. After defining the settlement as the one which was arrived at between the Corporation and their workers on 24 1 1974 under section 18	 read with clause (p) of section 2	 of the and the similar further settlement of 6 2 1974	 section 3 lays down (1) [1976](2)S.C.R.347. 343 "Notwithstanding anything contained in the 	 the provisions of each of the settlements	 in so far as they relate to the payment of an annual cash bonus to every Class	 III and Class IV employees of the Corporation at the rate of fifteen per cent of his annual salary	 shall not have any force or effect and shall not be deemed to have any force or effect on and from 1st day of April	 1975. " The object of the Act was	 in effect	 to take away the force of the judgment of the Calcutta High Court recognising the settlements in favour of Class III and Class IV employees of the Corporation. Rights under that judgment could be said to arise independently of Article 19 of the Constitution. I find my self in complete agreement with my learned brother Bhagwati that to give effect to the judgment of the Calcutta High Court is not the same thing as enforcing a right under Article 19 of the Constitution. It may be that a right under Article 19 of the Constitution becomes linked up with the enforceability of the judgment. Nevertheless	 the two could be viewed as separable sets of rights. If the right conferred by the judgment independently is sought to be set aside	 section 3 of the Act	 would	 in my opinion	 be invalid for trenching upon the judicial power. I may	 however	 observe that even though the real object of the Act may be to set aside the result of the mandamus issued by the Calcutta High Court	 yet	 the section does not mention this object at all. Probably this was so because the jurisdiction of a High Court and the effectiveness of its orders derived their force from Article 226 of the Constitution itself	 These could not be touched by an ordinary act of Parliament. Even if section 3 of the Act seeks to take away the basis of the judgment of the Calcutta High Court	 without mentioning it	 by enacting what may appear to be a law	 yet	 I think that	 where the rights of the citizen against the State are concerned	 we should adopt an interpretation which upholds those rights. Therefore	 according to the interpretation	 I prefer to adopt the rights which had passed into those embodied in a judgment and became the basis of a Mandamus from the High Court could not be taken away in this indirect fashion. Apart from the consideration mentioned above there are also other considerations put forward	 with his usual vehemence	 by Mr. R. K. Garg who relies upon the directive principles of the State Policy as part of the basic structure of our Constitution. At any rate	 he submits that in judging the reasonableness of a provision the directive principles of State policy can be used	 as this Court has repeatedly done	 as criteria of reasonableness	 and	 therefore	 of validity. Garg bad relied strongly upon the provisions of Article 43 of the Constitution which says : "43. The State shall endeavour to secure by suitable legislation or economic Organisation or in any other way	 to all workers	 agricultural	 industrial or otherwise	 work	 a living wage		 conditions of work ensuring a decent standard 344 of life and full enjoyment of leisure and social and cultural opportunities and	 in particular	 the State shall endeavour to promote cottage industries on an individual or co operative basis in rural areas. " He submits that Article 43 casts an obligation on the State to secure a living wage for the workers and is part of the principles "declared fundamental in the governance of the country". In other words	 he would have us use Article 43 as conferring practically a fundamental right which can be enforced. I do not think that we can go so far as that because	 even though the directive principles of State policy	 including the very important general ones contained in Article 38 and 39 of the Constitution	 give the direction in which the fundamental policies of the State must be oriented yet	 we cannot direct either the Central Government or Parliament to proceed in that direction. Article 37 says that they "shall not be enforceable by any court	 but the principles therein laid down are nevertheless fundamental in the governance of the country and it shall be the duty of the State to apply these principles in making laws." Thus	 even if they are not directly enforceable by a court they cannot be declared ineffective. They have the life and force of fundamentals. The best way in which they can be	 without being directly enforced	 given vitality and effect in Courts of laws is to use them as criteria of reasonableness	 and	 therefore	 of validity	 as we have been doing. Thus	 if progress towards goals found in Articles 38 and 39 and 43 are desired	 there should not be any	 curtailment of wage rates arbitrarily without disclosing any valid reason for it as is. the case here. It is quite reasonable	 in my opinion	 to submit that the measure which seeks to deprive workers of the benefits of a settlement arrived at and assented to by the Central Government	 under the provisions of the 	 should not be set at naught by an Act designed to defeat a particular settlement. If this be the purpose of the Act	 as it evidently is	 it could very well be said to be contrary to public interest	 and	 therefore	 not protected by Article 19(6) of the Constitution. Furthermore	 I think that the principle laid down by this Court in Union of India & Ors. vs M/s. Indo Afghan Agencies Ltd.(1) can also be taken into account in judging the reasonableness of the provision in this case. It was held there (at p. 385) : "Under our jurisprudence the Government is not exempt from liability to carry out the representation made by it as to its future conduct and it cannot on some undefined and undisclosed ground of necessity or expediency fail to carry out the promise solemnly made by it	 nor claim to be the judge of its	 own obligation to the citizen on an ex parte appraisement of the circumstances in which the obligation has arisen." (1) [1968] (2)S.C.R.365. 34 5 In that case	 equitable principles were invoked against the Government. It is true that	 in the instant case	 it is a provision of the Act of Parliament and not merely a governmental order whose validity is challenged before us. Nevertheless	 we cannot forget that the Act is the result of a proposal made by the Government of the day which	 instead of proceeding under section 11(2) of the Life Insurance Corporation Act	 chose to make an Act of Parliament protected by emergency provisions. I think that the prospects held out	 the representations made 	 the conduct of the Government	 and equities arising therefrom	 may all be taken into consideration for judging whether a particular piece of legislation	 initiated by the Government and en acted by Parliament	 is reasonable. Mr. Garg has also strongly attacked section 3 of the Act as	 violative of Article 14 of the Constitution which was also not available to the petitioners during the emergency. He alleges that the Corporation has been making very handsome profits so that the question of jeopardising the interests of the Corporation or Policyholders could not arise. He submits that the Act is nothing more than selective discrimination practised against the lower levels of the staff of the Life Insurance Corporation. I do not think that these contentions are devoid of force. I am sorry that due to the very short interval left for me to dictate my opinion in this case I have not been able to fully set out the reasoning or to cite all the authorities I would have liked to have done. The pressure of work on hand is too great. I have several judgments to pronounce tomorrow	 the last day on which I shall have the authority to participate as a Judge in the decisions of this Court. I have	 however	 thought it to be my duty to indicate my line of thinking briefly as I have my doubts whether Article 31(2A) is not an effective answer to complete reliance upon Article 31(2) of the Constitution. It is true that the right to receive bonus which had been recognised by the Central Government both by its orders and conduct under a settlement is a right to property. Nevertheless	 since acquisition is defined by Article 31(2A) of the 'Constitution	 I seriously doubt whether that definition of acquisition really satisfied by the facts in the case before us. The provision reads as follows : "31(2A) Where a law does not provide for the transfer of the ownership or right to possession of any property to the State or to a Corporation evened or controlled by the State	 it shall not be deemed to provide for the compulsory acquisition or requisitioning	 of property	 notwithstanding that it deprives any person of his property. " I have	 however	 no doubt that the conclusion reached by my learned brother Bhagwati is quite correct inasmuch as the benefits of the rights recognised by the judgment of the Calcutta High Court could not be indirectly taken away by section 3 of the Act selectively directed against specified settlements only. 346 I think that section 3 of the impugned Act is struck by the provisions of Article 19(1) (f) of the Constitution and not saved by Article 19(6) of the Constitution. It is also struck by Article 14. If the fundamental rights guaranteed by Articles 14 and 19 are not suspended	 but their operation is only suspended	 a view which I expressed in A. D. M. Jabalpur vs Shivkant Shukla(1) the effect of the suspension is to restore the status quo ante. Would this not mean that only the validity of an attack based on Articles 14 and 19 is suspended during the Emergency ? But	 once this embargo is lifted Articles 14 and 19 of the Constitution whose use was suspended	 would strike down any legislation which would have been bad. In other words	 the declaration of invalidity is stayed during the emergency. Both Articles 358 and 359(1A) provide that	 as soon as a proclamation of emergency ceases to operate	 the effect of suspension must vanish "except as respects things done or omitted to be done before the law so ceases to have effect". The things done or omitted to be done could certainly not mean that the rights conferred under the settlements were washed off completely as the learned Attorney General suggested. To hold that would be to convert the suspension of invalidity into a validation of law made during the emergency. If the law was not validated but only its invalidation was suspended	 we should not give any wider effect to the suspension. I think we should interpret "things done or omitted to be done" very narrowly. If this be so	 it means that the settlements are not to be deemed to be wiped off. No doubt payments under them were temporarily suspended. This must obviously mean that no payment could be demanded under them during the emergency	 but	 as soon as the emergency was over	 the settlements would revive and what could not be demanded during the emergency would become payable even for the period of emergency for which payment was suspended. Otherwise the enactment will have effect even after the emergency had ceased. This would clearly be contrary to the express provisions of Article 358 and 359(1A). In other words	 valid claims cannot be washed off by the emergency per se. They can only be suspended by a law passed during the operation of Article 358 and 359(1A) of the Constitution. For the reasons given above	 I reach the same conclusion as my learned brother Bhagwati although perhaps by a difference route. concur in the final order made by my learned Brother Bhagwati. BHAGWATI	 J. These writ petitions are filed by employees of the Life Insurance Corporation challenging the constitutional validity of the Life Insurance Corporation (Modification of Settlement) Act	 1976. This unusual piece of legislation was enacted by Parliament during the emergency at a time when there could hardly be any effective debate or discussion and it sought to render ineffective a solemn and deliberate Settlement arrived at between the Life Insurance Corporation and four different associations of its employees for payment of cash bonus. It is necessary	 in order to appreciate the various (1) A.T.R. Suppl. S.C.R. 172. 347 contentions arising in the writ petitions to recapitulate briefly the facts leading up to the enactment of the Life Insurance Corporation (Modification of Settlement) Act	 1976	 hereinafter referred to as the impugned Act. The Life Insurance Corporation is a statutory authority established under the and under section 6 it is the general duty of the Life Insurance Corporation to carry On life insurance business	 whether in or outside India	 and it is required to so exercise its powers as to secure that life insurance business is developed to the best advantage of the community. It is not necessary to refer to the various provisions of the which define the powers	 duties and functions of the 	 since we are not concerned with them in these writ petitions. It would be enough to refer to section 49 which confers power on the Life Insurance Corporation to make regulations. 'Sub section (1) of that section provides that the Life Insurance Corporation may	. with the previous approval of the Central Government	 make regulations	 not in consistent with the Act	 "to provide for all matters for which provision is expedient for the purpose of giving effect to the provisions" of the Act and sub section (2) enacts that in particular and without prejudice to the generality of the power conferred under sub section (1)	 such regulations may provide for "(b) the method of recruitment of employees and agents of the Corporation and the terms and conditions of service of such employees or agents; (bb) the terms and conditions of service of persons who have become employees of the Corporation under subsection (1) of section 11;" The Life Insurance Corporation has in exercise of the power conferred under clauses (b) and (bb) of sub section (2). of section 49 and with the previous approval of the Central Government	 made the Life Insurance Corporation (Staff) Regulations	 1960 defining the terms and conditions of service of its employees. There is only one Regulation which is material for our purpose	 and that is Regulation 58 which is in the following terms "The Corporation may	 subject to such directions as the Central Government may issue	 grant non profit sharing bonus to its employees and the payment thereof	 including conditions of eligibility for the bonus	 shall be regulated by instructions issued by the Chairman from time to time. " We have set out Regulation 58 in its present form as that is the form in which it stood throughout the relevant period. It will be a matter for consideration as to what is the effect of this Regulation on the Settlement arrived at between the Life Insurance Corporation and its employees in regard to bonus. 348 It appears that right from 1959 Settlement were arrived at between the Life Insurance Corporation and its employees from time to time in regard to various matters relating to the terms and conditions of service of Class III and Class IV employees including bonus payable to them. The last of such Settlement dated 20th June	 1970	 as modified by the Settlement dated 26th June	 1972	 expired on 31st March	 1973. Thereupon four different associations of employees of the Life Insurance Corporation submitted their charter of demands for revision of scales of pay	 allowances and other terms and conditions of service on behalf of Class III and Class IV employees. The Life Insurance Corporation carried on negotiations with these associations. between July 1973 and January 1974 at which there was free and frank exchange of views in regard to various matters including the obligation of the Life Insurance Corporation to the policy holders and;. the community and ultimately these negotiations culminated in a Settlement: dated 24th January	 1974 between the Life Insurance Corporation and these associations. The Settlement having been arrived at other wise than in the course of conciliation proceeding	 was binding on the parties under section 18	 sub section (1) of the and since the four associations which were parties to the. employees	 the Settlement was binding on the Life Insurance Corporation and all its Class III and Class IV employees. The Settlement provided for various matters relating to the terms and conditions of: service but we are concerned only with Clause (8) which made provision in regard to bonus. That clause was in the following terms "(i) No profit sharing bonus shall be paid. However	 the Corporation may	 subject to such directions as the Central Government may issue from time to time	 grant any other kind of bonus to its Class III & IV employees. (ii) An annual cash bonus will be paid to all Class III and ' Class IV employees at the rate of 15% of the annual salary (i.e. basic pay including of	special pay	 if any	 and dearness allowance and additional dearness allowance) actually drawn by an employee in respect of the financial year to which thebonus relates. (iii) Save as provided herein all other terms and conditions attached to the admissibility and payment of bonus shall be as laid down in the Settlement on bonus dated tile 26th	 June	 1972. " It is also necessary to reproduce here Clause (12) as that has some bearing on the controversy between the parties "PERIOD OF SETTLEMENT: (1) This Settlement shall be effective from 1st April	 1973 and shall be for a period of four years	 i.e.	 from 1st April		 1973 to 31st March	 1977. 349 (2) The terms of this Settlement shall be subject to the approval of the Board of the Corporation and the Central Government. (3) This Settlement disposes of all the demands raised by the workmen for revision of terms and conditions of their service. (4) Except as otherwise provided or modified by this Settlement	 the workmen shall continue to be governed by all the terms and conditions of service as set forth and regulated by the Life Insurance Corporation of India (Staff) Regulations	 1960 as also the administrative instructions issued from time to time and they shall	 subject to the provisions thereof including any period of operation specified therein be entitled to	 the benefits thereunder. " It was common ground between the parties that the Settlement was approved by the Board of the Life Insurance Corporation as also by the Central Government and the Chief of Personnel by his Circular dated 12th March	 1974 intimated to the Zonal and Divisional Managers that the approval of the Central Government to the Settlement having been received the Life Insurance Corporation should proceed to implement the terms of the Settlement. The Executive Director also issued a circular dated 29th March	 1974 containing administrative instructions in regard to	 payment of cash bonus under clause 8 (ii) of the Settlement. These administrative instructions set out directions in regard to Various matters relating to payment of cash bonus and of these	 two are material. One was that in case of retirement or death	 salary up to the date of cessation of service shall be taken into account for the purpose of determining the amount of bonus payable to the employee	 or his heirs and the other was that the bonus shall be paid along with the salary for the month of April	 but in case of retirement or death	 payment will be made "soon after the contingency". There was no dispute that for the first two years	 1st April	 1973 to 31st March	 1974 and 1st April	 1974 to 31st March	 1975	 the Life Insurance Corporation paid bonus to its Class III and Class IV employees in accordance with the provisions of Clause 8(ii) of the Settlement read with the administrative instructions dated 29th March	 1974. But then came the declaration of emergency on 26th June	 1975 and troubles began for Class III and Class IV 	employees of the Life Insurance Corporation. On 25th September	 1975 an Ordinance was promulgated by the President of India called the Payment of Bonus (Amendment) Ordinance	 1975 which came into force with immediate effect. Subsequently	 this Ordinance was replaced by the Payment of Bonus (Amendment) Act	 1976 which was brought into force with retrospective effect from the date of the Ordinance	 namely	 25th September	 1975. This amending law considerably curtailed the rights of the employees to bonus in industrial establishments	 but it had no impact so far as the employees of the Life Insurance Corporation were concerned since the original was not applicable to the life Insurance Corporation by reason of section 32 which exempted the Life Insurance L5 277SCI/78 350 Corporation from its operation. The Central Government	 however	 decided that the employees of establishments which were not covered by the would not be eligible for payment of bonus but ex gratia cash payment in lieu of bonus would be made "as may be determined by the Government taking into account the wage level	 financial circumstances etc. in each case and such payment will be subject to a maximum of 10% and pursuant to this decision	 the Life Insurance Corporation was advised by the Ministry of Finance that no further payment of bonus should be made to the employees "without getting the same cleared by the Government". The Life Insurance Corporation thereupon by its Circular dated 26th September	 1975 informed all its offices that since the question of payment of bonus was being reviewed in the light of the Bonus Ordinance dated 25th September		 1975	 no bonus should be paid to the employees "under the existing provisions until further instructions". The ' All India Insurance Employees ' Association protested against this stand taken by the Life Insurance Corporation and pointed out that the Life Insurance Corporation was bound to pay bonus in accordance with the terms of the Settlement and the direction not to pay bonus was clearly illegal and unjustified. The Life Insurance Corporation conceded that payment of bonus was covered by the settlement but contended that it was subject to such directions as the Central Government might issue from time to time and since the Central Government had advised the Life Insurance Corporation not to make any payment of bonus without their specific approval	 the Life Insurance Corporation was justified in not making payment to the employees. This stand was taken by the Life Insurance Corporation in its letter dated 7th February	 1976 addressed to	 the All India Insurance Employees ' Association and this was followed by a Circular dated 22nd March	 1976 instructing all the offices of the Life Insurance Corporation not to make payment by way of bonus. The All India Insurance Employees ' Association and some others thereupon filed writ petition No. 371 of 1976 in the High Court of Calcutta for a writ of Mandamus and Prohibition directing the Life Insurance Corporation to act in accordance with the terms of the Settlement dated 24th January. 1974 read with the administrative instructions dated 29th March	 1974 and to rescind or cancel the Circulars dated 26th September	 1975	 7th February	 1976 and 22nd March	 1976 and not to refuse to pay cash bonus to Class III and Class IV employees along with their salary for the month of April 1976 as provided by the Settlement read with the administrative instructions. The writ petition was resisted by the Life Insurance Corporation on various grounds to which it is not necessary to refer since we are not concerned with the correctness of the judgment of the Calcutta High Court disposing of the writ petition. Suffice it to state	 and that is material for our purpose	 that by a judgment dated 21st May	 1976 a Single Judge of the Calcutta High Court allowed the writ petition and issued a writ of Mandamus and Prohibition as prayed for in the writ petition. The Life Insurance Corporation preferred a Letters Patent Appeal against the judgment of the learned Single Judge but in the mean time the impugned Act bad already come into force and it was	 therefore	 stated on behalf of the Life Insurance Corporation before the Division Bench that there was 351 no necessity for proceeding with the appeal and hence the Division Bench made no order in the appeal. The result was that the judgment of the learned Single Judge remained intact : with what effect	 is a matter we shall presently consider. On 29th May	 1976 Parliament enacted the impugned Act providing inter alia for modification ' of the Settlement dated 24th January	 1974 arrived at between the Life Insurance Corporation and its employees. The impugned Act was a very short statute consisting only of three sections. Section 1 gave the short title of the impugned Act	 section 2 contained definitions and section 3	 which was the operative section	 provided as follows : "Notwithstanding anything contained in the 	 the provisions of the settlement in so far as they relate to the payment of an annual cash bonus to every Class III and Class IV employees of the Corporation at the rate of fifteen per cent	 of his annual salary	 shall not have any force or effect and shall not be deemed to have had any force or effect on and from the 1st day of April	 1975. " Since the impugned Act did not set at naught the entire settlement dated 24th January	 1974 but merely rendered without force and effect the provisions of the Settlement in so far as they related to payment of annual cash bonus to Class III and Class IV employees and that too not from the date when the Settlement became operative but from 1st April	 1975	 it was said to be a statute modifying the pro visions of the Settlement. The plain and undoubted effect of the impugned Act was to deprive Class III and Class IV employees of the annual cash bonus to which they were entitled under clause 8(ii) of the Settlement for the years 1st April	 1975 to 31st March	 1976 and 1st April	 1976 to 3 1 St March	 1977 and therefore	 two of the associations along with their office bearers field the present writ peti tions challenging the constitutional validity of the impugned Act. There were two grounds on which the constitutionality of the impugned Act was assailed on behalf of the petitioners and they were as follows : A. The right of Class III and Class TV employees to annual cash bonus for the years 1st April	 1975 to 31st March	 1976 and 1st April	 1976 to 31st March	 1977 under clause 8(ii) of the Settlement was property and since the impugned Act provided for compulsory acquisition of this property without payment of compensation	 the impunged Act was violative of Article 31(2) of the Constitution and was hence null and void. B. The impugned Act deprived Class III and Class IV employees of the right to annual cash bonus for the years 1st April	 1975 to 31st March	 1976 and 1st April	 1976 to 31st March	 1977 which was vested in them under clause 8(ii) of the Settlement and there was	 therefore	 clear infringement of their fundamental right under Article 3 52 19(1) (f) and since this deprivation of the right to annual cash bonus	 which was secured under a Settlement arrived at as a result of collective bargaining and with full and mature deliberation on the part of the Life Insurance Corporation and the Central Government after taking into account the interests of the policy holders and the community and with a view to approximating towards the goal of a living wage as envisaged in Article 43 of the Constitution	 amounted to an unreasonable restriction	 the impugned Act was not saved by Article 19(5) and hence it was liable to be struck down as invalid. We shall proceed to consider these grounds in the order in which we have set them out	 though we may point out that if either ground succeeds	 it would be unnecessary to consider the other. But before we proceed	 further	 it would be convenient at this stage to refer to one other contention of the petitioner based on the judgment of the Calcutta High Court in Writ Petition No. 371 of 1976. The contention was that since the Calcutta High Court had by its judgment dated 21st May	 1976 issued a writ of Mandamus directing the Life Insurance Corporation to pay annual cash bonus to Class III and Class IV employees for the year 1st April	 1975 to 31st March	 1976 along with their salary for the month of April	 1976 as provided by the Settlement and this judgment had be come final by reason of withdrawal of the Letters Patent Appeal preferred against it	 the Life Insurance Corporation was bound to obey the writ of Mandamus and to pay annual cash bonus for the year 1st April	 1975 to 31st March	 1976 in accordance with the terms of clause 8(ii) of the Settlement. It is	 no doubt	 true	 said the petitioners	 that the impugned Act	 if valid	 struck at clause 8(ii) of the Settlement and rendered it ineffective and without force with effect from 1st April	 1975 but it did not have the effect of absolving the Life Insurance Corporation from its obligation to carry out the writ of Mandwnus. There was	 according to the petitioners	 nothing in the impugned Act which set at naught the effect of the judgment of the Calcutta High Court or the binding character of the writ of Mandamus issued against the Life Insurance Corporation. This contention of the petitioners requires serious consideration and we are inclined to accept it. It is significant to note that there was no reference to the judgment of the Calcutta High Court in the Statement of Objects and Reasons	 nor any non obstante clause referring to a judgment of a court in section 3 of the impugned Act. The attention of Parliament does not appear to have been drawn to the fact that the Calcutta High Court had already issued a writ of Mandamus commanding the Life Insurance Corporation to pay the amount of bonus for the year 1st April	 1975 to 31st March	 1976. It appears that unfortunately the judgment of the Calcutta High Court remained almost unnoticed and the impugned Act was passed in ignorance of that judgment. Section 3 of the impugned Act provided that the provisions of the Settlement in so far as they relate to payment of annual cash bonus to Class III 353 and Class IV employees shall not have any force or effect and shall not be deemed to have had any force or effect from 1st April	 1975. But the writ of Mandamus issued by the Calcutta High Court directing the Life Insurance Corporation to pay the amount of bonus for the year 1st April	 1975 to 31st March	 1976 remained untouched by the impugned Act. So far as the right of Class III and Class IV employees to annual cash bonus for the year 1st April	 1975 to 31st March	 1976 was concerned	 it became crystallised in the judgment and thereafter they became entitled to enforce the writ of Mandamus granted by the judgment and not any right to annual cash bonus under the settlement. This right under the	 judgment was not sought to be taken away by the impugned Act. The judgment continued to subsist and the Life Insurance Corporation was bound to pay annual cash bonus to Class III and Class IV employees for the year 1st April	 1975 to 31st March	 1976 in obedience to the writ of Mandamus. The error committed by the Life. Insurance Corporation was that it withdrew the Letters Patent Appeal and allowed the judgment of the learned Single Judge to become final. By the time the Letters Patent Appeal came up for hearing	 the impugned Act had already come into force and the Life Insurance Corporation could	 therefore	 have successfully contained in the Letters Patent Appeal that	 since the Settlement	 in as far as it provided for payment of annual cash bonus	 was annihilated by the impugned Act with effect from 1st April	 1975	 Class III and Class IV employees were not entitled to annual cash bonus for the year 1st April	 1975 to 31st March	 1976 and hence no writ of Mandamus could issue directing the Life Insurance Corporation to make payment of such bonus. If such contention had been raised	 there is little doubt	 subject of course to any constitutional challenge to the validity of the impugned Act	 that the judgment of the learned Single Judge would have been upturned and the Writ petition dismissed. But on account of some inexplicable reason	 which is difficult to appreciate	 the Life Insurance Corporation did not press the Letters Patent Appeal and the result was that the judgment of the learned Single Judge granting writ of Mandamus became final and binding on the parties. It is difficult to see how in these circumstances the Life Insurance Corporation could claim to be absolved from the obligation imposed by the judgment to carry out the Writ of Mandamus by relying on the impugned Act. The Life Insurance Corporation leaned heavily on the decision of this Court in Shri Prithvi Cotton Mills Ltd. vs Broach Borough Municipality( ' ) in support of its contention that when the settlement in so far as it provided for payment of annual cash bonus was set at naught by the impugned Act with effect from 1st April	 1975	 the basis on which the judgment proceeded was fundamentally altered and that rendered the judgment ineffective and not binding on the parties. We do not think this decision lays down any such wide proposition as is contended for and on behalf of the Life Insurance Corporation. It does not say that whenever any actual or legal situation is altered by retrospective legislation	 a judicial decision rendered by a court on the basis of such factual or legal situation prior to the alteration	 would (1) [1970]1 S.C.R. 388. 354 straightaway	 without more	 cease to be effective and binding on the parties. It is true that there	 are certain observations in this decision which seem to suggest that a court decision may cease to be binding when the conditions on which it is based are so fundamentally altered that the decision could not have been given in the altered circumstances. But these observations have to be read in the light of the question which arose for consideration in that case. There	 the validity of the Gujarat Imposition of Taxes by Municipalities (Validation) Act	 1963 was assailed on behalf of the petitioners. The Validation Act had to be enacted because it was held by this Court in Patel Gordhandas Hargovindas vs Municipal Commissioner	 Ahmedabad(1) that since section 73 of the Bombay Municipality Boroughs Act	 1925 allowed the Municipality to levy a 'rate? on buildings or lands and the term 'rate? was confined to	 an imposition on the basis of annual letting value	 tax levied by the Municipality on lands	 and buildings on the basis of capital value was invalid. Section 3 of the Validation Act provided that notwithstanding anything contained in any judgment	 decree or order of a court or tribunal or any other authority	 no tax assessed or purported to have been assessed by a municipality on the	 basis of capital value of a building or land and imposed	 collected or recovered by the municipality at any time before the commencement of the Validation Act shall be deemed to have invalidly assessed	 imposed	 collected or recovered and the imposition	 collection or recovery of the tax so assessed shall be valid and shall be deemed to have always been valid and shall not be called in question merely on the ground that the assessment the tax on the basis of capital value of the building or land was not authorised by law and accordingly any tax so assessed before the commencement of the Validation Act and leviable for a period prior to such commencement but not collected or recovered before such commencement may be collected or recovered in accordance with the relevant municipal law. It will be seen that by section 3 of the impugned Act the Legislature retrospectively imposed tax on building or land on the basis of capital value and if the tax was already imposed	 levied and collected on that basis	 made the imposition levy	 collection and recovery of the tax valid	 notwithstanding the declaration by the Court that as 'rate	 the levy was incompetent. This was clearly permissible to the Legislature because in doing so	 the Legislature did not seek to reverse the decision of this Court on the interpretation of the word 'rate		 but retrospectively amended the law by providing for imposition of tax on land or building on the basis of capital value and validated the imposition	 levy	 collection and recovery of tax on that basis. The decision of this Court holding the levy of tax to be incompetent on the basis of the unamended law	 therefore	 became irrelevant and could not stand in the way of the tax being assessed	 collected and recovered on the	 basis of capital value under the law as retrospectively amended. That is why this Court held that the Validation Act was effective to validate imposition	 levy	 collection and recovery of tax on land or building on the basis of capital value. It is difficult to see bow this decision given in the context of a validating statute can be of any help to the life Insurance Corporation. Here	 the judgment given by the (1) [1964] 2S.C.R.608. 355 Calcutta High Court	 which is relied upon by the petitioners	 is not a mere declaratory judgment holding an impost or tax to be invalid	 so that a validation statute can remove the defect pointed out by the judgment amending the law with retrospective effect and validate such impost or tax. But it is a judgment giving effect to the right of the petitioners to annual cash bonus under the Settlement by issuing a writ of Mandamus directing the Life Insurance Corporation to pay the amount of such bonus. If by reason of retrospective	 alteration of the factual or legal situation	 the judgment is rendered erroneous	 the remedy may be by way of appeal or review	 but so long as the judgment stands	 it cannot be disregarded or ignored and it must be obeyed by the Life Insurance Corporation. We are	 therefore	 of the view that	 in any event	 irrespective of whether the impugned Act is constitutionally valid or not	 the Life Insurance Corporation is bound to obey the writ of Mandamus issued by the Calcutta High Court and to pay annual cash bonus for the year 1st April	 1975 to 31st March	 1976 to Class III and Class IV employees. Now	 to the grounds of constitutional challenge Re: Ground A : This ground raise & the question whether the impugned Act is violative of clause	 (2) of Article 31. This clause provides safeguards against compulsory acquisition or requisitioning of property by laying down conditions subject to which alone property may be compulsorily acquired or requisitioned and at the date when the impugned Act was enacted	 it was in the following terms "No property shall be	 compulsorily acquired or requisitioned save for a public purpose and save by authority of a law which provides for acquisition or requisitioning of the property for an amount which may be fixed by such law or which may be determined in accordance with such principles and given in such manner as may be specified in such law; and no	 such law shall be called in question in any court on the ground that the amount so fixed or determined is not adequate or that the whole or any part of such amount is to be given otherwise than in cash Clause (2) in this form was substituted in Article 31 by the Constitution (Twenty fifth Amendment) Act	 1971 and by this amending Act	 clauses (2A) and (2B) were also introduced in Article 31 and they read as follows : "(2A) Where a	 law does not provide for the transfer of the ownership or right to	 possession of any property to the State or to a corporation owned or controlled by the State	 it shall not be deemed to provide for the compulsory acquisition or requisitioning of Property	 notwithstanding that it does any person of his property. (2B) Nothing in sub clause (f) of clause (1) of Article 19 shall effect any such law as is referred to in clause (2) 356 The argument of the petitioners was that the right of Class III and Class IV employees to annual cash bonus ' for the	 years 1st April	 1975 to 31st March	 1976 and 1st April	 1976 to 31st March	 1977 under Act provided for Insurance	 Corporation 12	 it was a law providing for compulsory acquisition of property as contemplated under clause (2A) of Article 31 and it was	 therefore	 required to meet the challenge of Article 31	 clause (2). The compulsory acquisition of the right to annual cash bonus ' sought to be effectuated by the impugned Act	 said the petitioners	 was not supported by public purpose nor did the impugned Act. provide for payment of any compensation for the same and hence the impugned Act was void as contravening clause (2) of Article 21. The first question which arises for consideration on this. contention is whether the right of Class III and Class IV employees to 'annual cash bonus ' for the years 1st April	 1975 to 31st March	 1976 and 1st April	 1976 to 31st March	 1977 under the Settlement was property so as to attract the inhibition of Article 31	 clause (2). The Life Insurance Corporation submitted that at the date when the	 impugned Act was enacted	 Class III and Class IV employees had no absolute right to receive 'annual cash bonus ' either for the	 year 1st April	 1975 to 31st March	 1976 or for the year 1st April	 1976 to 31st March	 1977 and there was	 therefore		 no property which could be compulsorily acquired under the impugned Act. The argument of the Life Insurance Corporation was that the Life Insurance Corporation (Staff) Regulations	 1960 which laid down the terms and conditions of services inter alia of Class III and Class IV employees did not contain any provision for payment of bonus except Regulation 58 and since under this Regulation	 grant of annual cash bonus by the life Insurance Corporation was subject to such directions as the Central Government might issue	 the right of Class III and Class IV employees to receive annual cash bonus could not be said to be an absolute right. It was a right which was liable to	 be set at naught by any directions that might be issued by the Central Government and in fact the Central Government did issue a direction to the life Insurance Corporation not to make payment of bonus to the employees "without getting the same cleared by the Government" and consequently	 Class III and Class IV employees had no absolute right to claim bonus. The result	 according to the Life Insurance Corporation	 also followed on a proper interpretation of clauses 8 (i) and 8(ii) of the Settlement	 for it was clear on a proper reading of these two clauses that annual cash bonus payable to Class III and Class IV employees under clause 8 (ii) was	 by reason of clause 8 (i) 	 subject to such directions as the Central Government might issue from time to time and the Central Government having directed that no further payment of bonus should be made to the employees	 Class III and Class TV employees were not entitled to claim annual cash bonus from the Life Insurance Corporation. This argument of the Life Insurance Corporation is plainly erroneous and it is	 not possible to accept it. Regulation 58 undoubtedly says that non profit sharing bonus may be granted by the Settlement was property and since the impugned transfer of the ownership of this right to the Life which was 'State ' within the meaning of Article 35 7 the Life Insurance Corporation to its employees	 subject to such directions as the Central Government may issue and	 therefore	 if the Central Government issues a direction to the contrary	 nonprofit sharing bonus cannot be granted by the Life Insurance Corporation to any class of employees. But here	 in the present case	 grant of annual cash bonus by the Life Insurance Corporation to Class III and Class IV employees under clause 8(ii) of the Settlement was approved by the Central Government as provided it clause 12 and the 'direction contemplated by Regulation 58 was given by the Central Government that annual cash bonus may be granted as provided in clause 8(ii) of the Settlement. It was not competent to the Central Government thereafter to issue another contrary direction which would have the effect of compelling the Life Insurance Corporation to commit a breach of its obligation under section '18	 sub section (1) of the to pay annual cash bonus in terms of clause 8 (ii) of the Settlement. Tumina to clause 8(i) of the Settlement	 it is true that under this	 clause non profit sharing bonus could be granted by the Life Insurance Corporation 'subject to such directions as the Central Government may issue from time to time but these words giving overriding power to the Central Government to issue directions from time to time are conspicuously absent in clause 8(ii) and it is difficult to see bow they could be projected or read into that clause	. Clauses 8(i) and 8(ii are distinct and independent clauses and while clause 8(i) enacts a general provision that non profit sharing bonus may be paid by the Life Insurance Corporation to Class III and Class IV employees subject to such directions as the Central Government might issue from time to time	 clause 8(ii) picks out one kind of non profit sharing bonus and specifically provided that annual cash bonus shall be paid to all Class III and Class IV employees at the rate of 15 per cent of the annual salary and this specific provision in regard to payment of annual cash bonus is made subject to only the approval of the Central Government which was admittedly obtained. It is	 therefore	 clear that Class III and Class IV employees had absolute right to receive annual cash bonus from the Life Insurance Corporation in terms of clause 8(ii) of the Settlement and it was not competent to the Central Government to issue any directions to the Life Insurance Corporation to refuse or withhold payment of the same. It is true that under clause 8(ii) of the Settlement the annual cast bonus for a particular year was payable at the rate of 15 per cent. of the annual salary actually drawn by the employee in respect of the financial year to which the bonus	 related and it would	 therefore	 seem that the bonus was payable at the end of. the year and not before	 but it was not disputed on behalf of the Life Insurance Corporation that even an employee who retired or resigned before the	 expiration of that year	 as also the heirs of a deceased employee who died during the. currency of the year	 were entitled to receive	 proportionate bonus and the Life Insurance Corporation in fact recognised this to be the correct position in its administrative instructions dated 29th March	 1974 and actually paid proportionate bonus to the retiring or resigning employee and the heirs; of the deceased employee. The annual cash bonus payable under clause 8(ii) of the Settlement	 therefore	 accrued 358 from day to day	 though payable in case of retirement resignation or death	 on the happening of that contingency and otherwise	 on the expiration of the year to which the bonus related. There was thus plainly and unquestionably a debt in respect of annual cash bonus accruing to each Class III or Class IV employees from day to day and consequently	 on the expiration of the year 1st April	 1975 to 31st March. 1976	 the annual cash bonus payable under clause 8(ii) of the Settlement was a debt due and owing from the Life Insurance Corporation to each Class III or Class IV employee and so also at the date when the impugned Act came into force	 each Class III or Class IV employee was entitled to a debt due and owing to him from the Life Insurance Corporation in respect of the annual cash bonus from 1st April	 1976 upto that date. The question is whether these debts due and owing from the Life Insurance Corporation were property of Class III and Class IV employees within the meaning of Article 31(2). So also	 was the right of each Class III and Class IV employee to receive annual cash bonus for the period from the date of commencement of the impugned Act upto 31st March	 1977 property for the purpose of Article 31(2) ? These questions we shall now proceed to consider	 for on the answer to them depends the applicability of Article 31(2). It is clear from the scheme of fundamental rights embodied in Part III of the Constitution that the guarantee of the right to property is contained in Article 19 (1 ) (f) and clauses ( 1 ) and (2) of Article 31. It stands to reason that 'property ' cannot have one meaning in Article 19(1) (f)	 another in Article 31 clause (1) and still another in Article 31	 clause (2). 'Property ' must have the same connotation in all the three Articles and since these are constitutional provisions intended to secure a fundamental right	 they must receive the widest interpretation and must be held to refer to property of every kind. While discussing the scope and content of Entry 42 in List III of the Seventh Schedule to the Constitution	 which confers power on Parliament and the Legislatures to legislate with respect to "acquisition and requisitioning of property" It was J.	 speaking on behalf of the majority in R. India(1) that property which can be compulsorily aquired by legislation under this Entry means the "highest anything	 being that right which one has to with respect to "acquisition and requisition of property"	 it was pointed out by Shah	 C. Cooper vs Union of acquired by legislative a man can have to lands or tenements	 goods or chattels which does not depend on another 's courtesy : it includes ownership	 estates and interests in corporeal things	 and also rights such as trade marks	 copyrights	 patents and even rights in persona capable of transfer or transmission	 such	 as debts; and signifies a beneficial right to or a thing considered as having a money value	 especially with reference to transfer or succession	 and to their capacity of being injured". It would	 therefore	 seem that	 according to the decision of the majority in R. C. Cooper '.s case	 debts and other rights in personam capable of transfer or transmission are property which can form the subject matter of compulsory acquisition. And this would seem to be unquestionable on principle	 since even jurisprudentially debts and other rights of action are property and there is no (1) ; 359 reason why they should be excluded from the protection of the constitutional guarantee. Hidayatullah	 C.J.	 had occasion to consider the true nature of debt in H. H. Maharajadhiraja Madhav Rao Jiwaji Rao Scindia Bahadur & Ors. vs Union of India(1) where the question was whether the Privy Purse payable to the Ruler was property of which he could be said to be deprived by the Order of the President withdrawing his recognition as Ruler. The learned Chief Justice	 making a very penetrating analysis of the jural relationship involved	 in a debt	 pointed out that " a debt or a liability to pay money passes through four stages. First there is a debt not yet due. The debt has not yet become a part of the obliger 's 'things ' because. no net liability has yet arisen. The Second stage is when the liability may have arisen but is not either ascertained or admitted. Here again the amount due has not become a part of the obligor 's things	 The third stage is reached when the liability is both ascertained and admitted. Then it is property proper of the debtor in the creditor 's hands. The law begins to recognise such property in insolvency	 in 	dealing with it in fraud of creditors	 fraudulent preference of one creditor against another	 subrogation	 equitable estoppel	 stoppage intransitive etc. A credit debt is then a debt fully provable and which is fixed and absolutely owing. The last stage is when the debt becomes a judgment debt by reason of a decree of a Court." and apply ing this test	 concluded that the Privy Purse would be property and proceeded to add : "As	 soon as an Appropriation Act is passed there is established a credit debt and the outstanding Privy Purse becomes the property of the Ruler in the hands of Government. It is also a sum certain and absolutely payable." Since the effect of the Order of the President was to deprive the	 Ruler of his Privy Purse which was his property the learned Chief Justice held that there was infringement of the fundamental right of the Ruler under Article 3 1 (2). Hegde	 J.	 also pointed out in a separate but concurring judgment that since the right to get the Privy Purse was a legal right "enforceable through the courts"	 it was undoubtedly property and its deprivation was sufficient to	 found a petition based on contravention of Article 31(2). It was also held by this Court in State of Madhya Pradesh vs Ranajirao Shinde & Anr. (2) that a right to receive cash grant annually from the State was property within the	 meaning of that expression in Article 19(1)(f) and clause (2) of Article 31. The right to pension was also regarded as property for the purpose of Article 19(1) (f) by the decisions of this Court in Deokinanda Prasad vs State of Bihar(1) and State of Punjab vs K. R. Erry & Sobhag Rai Mehta(4). This Court adopted the same line of reasoning when it said in State of Gujarat and Anr. vs Shri Ambica Mills Lid. 	 Ahmedabad(5) that "unpaid accumulations represent the obligation of the	 employers to the employees and they are the property of the employees". Mathew	 J.	 speaking on behalf of the Court	 observed that the obligation to	 the employees owned by the employers was (1) ; (3) [1971] Supp. S.C.R. 634. (4) ; (5) ; (2) 360 "property from the standpoint of the employees". It would	 therefore	 be seen that Property within the meaning of Article 19(1)(f) and clause (2) of Article 31 comprises every form of property	 tangible or intangible	 including debts and chooses in action	 such as unpaid accumulation of wages	 pension	 cash grant and constitutionally protected Privy Purse. The debts due and owing from the Life Insurance Corporation in respect of annual cash bonus were	 therefore	 clearly property of Class III and Class IV employees within the meaning of Article 31	 clause (2). And so also was their right to receive annual cash bonus for the period; from the date of commencement of the impugned. Act upto 31st March	 1977	 for that was a legal right enforceable through a court of law by issue of a writ of Mandamus	 Vide the observation of Hegde	 J.	 at page 194 in the Privy Purse case. But a question was raised on behalf of the Respondents whether debts and choses in action	 though undoubtedly property	 could form the subject matter of compulsory acquisition so as to attract the applicability of Article 31	 clause (2). There is divergence of opinion amongst jurists in the United States of America on this question and though in the earlier decisions of the American courts	 it was said that the power of eminent domain cannot be exercised in respect of money and choses in action	 the modern trend	 as pointed by Nicholas on Eminent Domain	 Vol. 1	 page 99	 para 2	 seems to be	 that the right of eminent domain can be exercised on choses in action. But even if the preponderant view in the United States were that choses in action cannot come within the power of eminent domain	 it would not be right to allow us to be unduly influenced by this view in the interpretation of the scope and ambit of clause (2) of Article 31. We must interpret Article 31	 clause (2) on its own terms without any preconceived notions borrowed from the law in the United States on the subject of eminent domain. Let us see how this interpretative exercise has been performed by this (Court in the decisions that have been rendered so far and what light they throw on the question as to whether choses in action can be compulsorily acquired under clause (2) of Article 31. We shall confine our attention only to the question of compulsory acquisition of choses in action and not say anything in regard to compulsory acquisition of money	 for in these appeals the question arises only in regard to choses in action and it is not necessary to consider whether money can form the subject matter of compulsory acquisition. This question came to be considered by a constitution Bench of this Court in State of Bihar vs Kameshwar Singh( '	). Section 4(b) of the Bihar Land Reforms Act	 1950	 which provided. for vesting in the State	 of arrears of rent due to the pro prietors or tenure holders for the period prior to the date of vesting of the estates or tenures held by them	 on payment of only 50 per cent of the amount as compensation	 was challenged as constitutionally invalid on the ground that there was no public purpose for which such acquisition could be said to have been made. The necessity for existence of public purpose was not sought to be spelt out from Article 31	 clause (2)	 because even if there were violation of that (1) 361 clause	 it would be protected by Article 31A and the Ninth Schedule read with Article 31 B	 the. Act being included as Item in the Ninth Schedule	 but it was said that public purpose was an essential element in the very nature of the power of acquisition and even apart from Article 31	 clause (2)	 no acquisition could be made save for a public purpose. It was in the context of this argument that Mahajan	 J.	 observed that money and choses in action could not be taken under the power of compulsory acquisition	 since the only purpose which such taking would serve would be to augment the revenues of the State and that would clearly not be a public purpose. The learned judge pointed out at pages 942 944 of the Report : "It is a well accepted proposition of law that property of individuals cannot be appropriated by the State under the power of compulsory acquisition for the	 mere purposes of adding to the	 revenues of the State no instance is known in which it has been taken for the mere purpose of raising a revenue by sale	 or otherwise Taking money under the right of eminent domain	 when it must be compensated in money afterwards is nothing more or less than a forced loan Money or that which in ordinary use passes as such and which the Government may reach by taxation and also rights in action which can only be available when made to produce money	 cannot be taken under this power". for the taking would not be for a public purpose	 and proceeded to and that the only purpose	 to support the acquisition of the arrears of rent was "to raise revenue to pay compensation to some of the zamindars whose estates are being taken" and this purpose did not fall within any definition	 however	 wide	 of the phrase 'public purpose and the law was	 therefore	 to this extent unconstitutional. Mukherjea	 J.	 came to the same conclusion and observed at page 961 of the Report "Money as such and also rights in action are ordinarily excluded from this List by American jurists and for good reasons. There could be no possible necessity for taking either of them under the power of eminent domain. Money in the hands of a citizen can be reached by the exercise of the power of taxation	 it may be confiscated as a penalty under judicial order But	 as Cooley has pointed out	 taking money under the right of eminent domain when it must be compensated by money afterwards could be nothing more or less than a forced loan and it is difficult to say that it comes under the head of acquisition and is embraced within its ordinary connotation. " Chandrasekhara Aiyer	 J.	 also took the same view and held that money. and choses in action were exempt from compulsory acquisition "not on the ground that they are movable property	 but on the ground that generally speaking there could be no public purpose in their 362 acquisition". Patanjali Sastri	 C.J.	 and Das	 J.	 on the other hand held that the arrears of rent constituted a debt due by the tenants. It was nothing but an actionable claim	 against the tenants which was undoubtedly a species of 'property ' which was assignable and	 therefore	 it could equally be acquired by the State as a species of 'property '. These two rival views were referred to by Venkatarama Aiyer	 J. speaking on behalf of the Court in Bombay Dyeing & Manufacturing Co. Ltd. vs The State of Bombay & Ors.(1) but the learned Judge did not treat the majority view as finally settling the law on the subject. It appears that in the subsequent case of State of Madhya Pradesh vs Ranajirao Shinde (supra) Hegde	 J.	 delivering the judgment of the Court observed that the majority view in Kameshwar Singh 's case was followed by this Court in Bombay Dyeing & Manufacturing Co. 's case	 but we do not think that this observation correctly represents what was decided in Bombay Dyeing & Manufacturing Co 's case. Venkatarama Aiyer	 J.	 rested his decision in Bombay Dyeing & Manufacturing Co '$ case on alternative grounds : if	 the impugned section provided for the acquisition of money	 and if money could not be acquired	 then the section was void under Article 19 (1) (f) as imposing an unreasonable restriction on the right to hold property. If	 on the other hand	 money could be acquired 	 the section was void as offending Article 31	 clause (2) since the section did not provide for payment of compensation. The decision in Bombay Dyeing & Manufacturing Co. 's case did not	 therefore	 lay down that money and choses in action could not be acquired under Article 31	 clause (2). But in State of Madhya Pradesh vs Ranojirao Shinde (supra) this Court did hold that money and choses in action could not form the subject matter of acquisition under Article 31	 clause (2) and the reason it gave for taking this view was the same as that which prevailed with the majority judges in Kameshwar Singh 's case. This Court held that the power of compulsory acquisition conferred under Article 31	 clause (2) could not be utilised for enriching the coffers of the State; that power could be exercised only for a public purpose and augmenting the resources of the State could not be regarded as public purpose. Hegde	 J.	 speaking on behalf of the Court	 pointed out that if it were otherwise	 "it would be permissible for the legislatures to enact laws acquiring all public debts due from the State	 annuity deposits returnable by it and provident fund payable by it by providing for the payment of some nominal compensation to the persons whose rights are acquired	 as the acquisitions in question would augment the resources of the State"	 but nothing so bad could be said to be within the contemplation of clause (2) of Article 31. Let us first examine on principles whether this reasoning qua choses in action is sound and commends itself for our acceptance. This premise on which this reasoning is based is that the only purpose for which choses in action may be acquired is augmenting the revenues of the State and there can be no other purpose for such (1) ; 363 acquisition. But this premise is plainly incorrect and so is the reasoning based upon it. Why can choses in action 'not be acquired for a public purpose other than mere adding to the revenues of the State ? There may be debts due and owing by poor and deprived tillers	 artisans and landless labourers to moneylenders and the State may acquire such debts with a view to relieving the weak and exploited debtors from the harassment and oppression to which they might be subjected by their economically powerful creditors. The purpose of the acquisition in such a case would not be to enrich the coffers of the State. In fact	 the coffers of the State would not be enriched by such acquisition	 because having regard to the financial condition of the debtors	 it may not be possible for the State to recover much	 or perhaps anything at all	 from the impoverished debtors. The purpose of such acquisition being relief of the distress of the poor and helpless debtors would be clearly a public purpose. We have taken one example by way of illustration	 but in a modern welfare State	 dedicated to a socialist pattern of society	 myriad situations may arise where it may be necessary to acquire choses in action for achieving a public purpose. It is not correct to say that in every case where choses in action may be acquired	 the purpose of acquisition would necessarily and always be augmenting of the revenues of the State and nothing else. Even the theory of forced loan may break down in case of acquisition of choses in action. There is a fundamental difference between chose in action and money	 in that the former has not the same mobility and liquidity as the latter and its values is not measured by the amount recoverable under it	 but it depends on a variety of factors such as the financial condition of the person liable	 the speed and effectiveness of the litigative process and the eventual uncertainty as to when and to what extent it may be possible to realise the chose in action. Even after the chose in action is acquired	 the State may not be able to recover the amount due under it and there may even be cases where the chose in action may be released by the State. Where money is given as compensation for taking of money	 the theory of forced loan may apply	. but it is difficult to see how it can be applicable where chose in action is taken and money representing its value	 which in a large majority of cases would be less than the amount recoverable under it	 is given as compensation. Moreover	 the theory of forced loan stands considerably eroded after the amendment of Article 31	 clause (2) by the Constitution (Twenty fifth Amendment) Act	 1971	 because under the amended clause	 even if an amount less than the just equivalent is given as compensation for acquisition of property	 it would not be violative of the constitutional guarantee. It is true	 and this thought was also expressed by Krishna Iyer	 J.	 and myself in our separate but concurring Judgment in the State of Kerala vs The Gwalior Rayon Silk Manufacturing (Wvg.) Co. Ltd.(1) that	 notwithstanding the amended clause (2) of Article 31	 the legislature would be expected	 save in exceptional socio historical setting to provide just compensation for acquisition of property	 but if for any reason the legislature provides a lesser amount than the just equivalent	 it would not be open to challenge on the ground of infringement of clause (2) of Article (1) [1974] 1 S.C.R.671. 364 31. Then	 how can the theory of forced loan apply when chose in action is acquired and what is paid for it is not the just equivalent but a much lesser amount	 which is of course not illusory. Moreover	 there is also one other fallacy underlying the argument that there can be no public purpose in the acquisition of choses in action and that is based on the assumption that the public purpose contemplated by Article 31	 clause (2) lies in the use to which the pro perty acquired is to be put as for example	 where land or building or other movable property is acquired for being used for a public purpose. But this assumption is hot justified by the language of Article 31	 clause (2)	 because all that this clause requires is that the purpose for which the acquisition is made must be a public purpose	 or	 in other words	 the	 acquisitions must be made to achieve a public purpose. Article 31	 clause (2) does not require that the property acquired must itself be used for a public purpose. So long as the acquisition subserves a public purpose	 it would satisfy the requirement of clause (2) of Article 31 and	 therefore	 if it can be shown that the acquisition of choses in action is for subserving a public purpose	 it would be constitutionally valid. Hegde	 J.	 expressed an apprehension in State of Madhya Pradesh vs Ranojirao Shinde (supra) that if this view were accepted	 it would be permissible for the legislature to enact laws acquiring the public debts due from the State	 the annuity deposits returnable by it and the provident fund payable by it by providing for payment of some nominal compensation to the persons whose rights were acquired. We do not think this apprehension is well founded. It is difficult to see what public purposes can possibly Justify a law acquiring the public debts due to the State or the annuity deposits returnable by it or the provident fund payable by it. If the legislature enacts a law acquiring any of these choses in action	 it could only be for the purpose of augmenting the revenues of the State or reducing State expenditure and that would clearly not be a public purpose and the legislation would plainly be violative of the constitutional guarantee embodied in Article 31	 clause (2). We would	 therefore	 prefer the minority view of Das	 J.	 in Kameshwar singh 's case (supra) as against the majority view of Mahajan	 J.	 Mukherjea	 J. and Chandrasekhara Aiyer	 J. So much on principle. Turning now to the authorities	 we find that	 apart from the view of the majority judges in Kameshwar Singh 's case and the decision in the State of Madhya Pradesh vs Ranojirao Shinde (supra)	 there is no other decision of this Court which has taken the view that choses in action cannot be compulsorily acquired under Article 31	 clause (2). There are in fact subsequent decisions which clearly seem to suggest the	 contrary. We have already referred to R. C. Cooper 's case. The majority judgment case gives the widest meaning to 'property which of Shah	 J.	 in that can be	 compulsorily acquired and includes within it ::rights in personam capable of transfer or transmission	 such as debts. The majority view in Kameshwar Singh 's case (supra) and the decision in State of Madhya Pradesh vs Ranojirao Shinde (supra) on this point can no longer be regarded as good law in view of this statement of the law in the majority judgment of Shah	 J. Then again	 in the Privy Purse case (supra)	 365 Hidayatullah	 C.J.	 held that the Privy Purse payable to a Ruler was a credit debt owned by him and since he was deprived of it by the Order of the President	 there was violation of his fundamental right under Article 31	 clause (2). The learned Chief Justice thus clearly recognised that debt or chose in action could form the subject matter of compulsory acquisition under Article 31	 clause (2). Hegde	 J.	 also took the same view in his separate but concurring judgment in the Privy Purse case. It will	 therefore	 be seen that the trend of the recent decisions has been to regard debt or chose in action as property which can be compulsorily acquired under clause (2) of Article 31. We are accordingly of the view that the debts due and owing from the Life Insurance Corporation to Class III and Class IV em ployees in respect of annual cash bonus were 'property ' within the meaning of Article 3 1	 clause (2) and they could be compulsorily acquired under that clause. The question	 however	 still remains whether by the impugned Act there was compulsory acquisition of the debt due and owing from the Life Insurance Corporation to Class III and Class IV employees in respect of annual cash bonus. It was not disputed on behalf of the Life Insurance Corporation that if the impugned Act had the affect of compulsorily acquiring these debts belonging to Class III and Class IV employees	 it would be void as offending Article 31	 clause (2)	 since it admittedly did not provide for payment of any compensation. The Statement of Objects and Reasons undoubtedly said that the provisions of the Settlement in regard to payment of annual cash bonus were being set aside with effect from 1st April	 1975 with a view to enabling the Life Insurance Corporation to make ex gratia payment to the employees "at the rates determined on the basis of the general Government policy for making ex gratia payments to the	 employees of non competing public sector undertaking". But the impugned Act did not contain any provision to that effect and Class III and Class IV employees were deprived of the debts due and owing to them without any provision in the statute for payment of compensation. The learned Attorney General on behalf of the Life Insurance Corporation	 however	 strenuously contended that there was no compulsory acquisition of the debts due and owing to	 Class III and Class IV employees under the impugned Act	 but all that the impugned Act did was to extinguish those debts by annihilating the provisions of the Settlement in regard to payment of annual cash bonus with effect from 1st April	 1975. The debts due and owing from the Life Insurance Corporation to Class III and Class IV employees	 said the learned Attorney General	 were extinguished and not compulsorily acquired and hence there was no contravention of Article 31	 clause (2). Now	 prior to the Constitution (Fourth Amendment) Act	 1955	 which introduced clauses (2A) and (2B) in Article 3 1	 there was considerable controversy as to the inter relation between clauses (1) and. (2) and that coloured the interpretation of the words "taken possession of or acquired" in clause (2) as it stood prior to the amendment. The majority view in The State of West Bengal vs Subodh Gopal Bose & Ors.(1) and Dwarkadas Shrinivas of (1) ; 6 277SCI/78 366 Bombay vs The Sholapur Spinning & Weaving Co. Ltd. & Ors:(1) was that clauses (1) and (2) of Article 31 were not mutually exclusive; but they dealt with same topic and the deprivation contemplated in clause (1) was no	 other than the compulsory acquisition or taking possession of property referred to in clause (2) and hence where the deprivation was so substantial as to amount to compulsory acquisition or taking possession	 Article 31 was attracted. The introduction of clause ( ' )A) in Article	 31 snapped the link between clauses (1) and (2) and brought about a dichotomy between these two clauses. Thereafter	 clause. (2) alone dealt with compulsory acquisition or requisitioning of property by the State and clause (1) dealt with deprivation of property in other ways and what should be regarded as compulsory acquisition or requisitioning of property for the Purpose of clause (2) was defined in clause (2A). It was if clause (2A) supplied the dictionary for the mean of 'compulsory acquisition and requisitioning of property in clause (2). Clause (2A) declared that a law shall not be deemed	 to provide for the compulsory acquisition or requisitioning of property	 if it does not provide for the transfer of the ownership or right to possession of the property to the State or to a corporation owned or controlled by the State. It is only where a law provides for the transfer of ownership or right to possession of any property to the State or to a corporation owned or controlled by the State that it would have to meet the challenge of clause (2) of Article 31 as a law providing for compulsory acquisition or requisitioning of property. Whenever	 therefore	 the constitutional validity of a law is challenged on the ground of infraction of Article 31	 clause (2)	 the question has to be asked whether the law provides for the transfer of ownership or right to possession of any property to the State or to a corporation owned or controlled by the State. Here	 the Life Insurance Corporation is a corporation owned by the State as its entire capital has been provided by the Central Government. The debts due	 and owing to Class III and Class IV employees from the Life Insurance Corporation are cancelled or extinguished by the impugned Act. Does that amount to transfer of ownership of any property to the Life Insurance Corporation within the meaning of clause (2A) of Article 31 ? If it does	 Article 31	 clause (2) would be attracted	 but not otherwise. That depends on the true interpretation of Article 31	 clause (2A). Now	 whilst interpreting Article 31	 clause (2A)	 it must be remembered that the interpretation we place upon it will determine the scope and ambit of the constitutional guarantee under clause (2) of Article 31. We must not	 therefore	 construe clause (2A) in a narrow pedantic manner nor adopt a doctrinaire or legalistic approach. Our interpretation must be guided by the substance of the matter and not by lex scripts. When clause (2A) says that in order to attract the applicability of clause (2) the law must provide for the transfer of ownership of property to the State or to a corporation owned or controlled by the State	 it is not necessary that the law should in so many words provide for such transfer. No particular verbal formula need be adopted. It is not a ritualistic mantra which is required to be repeated in the law. What (1) ; 3 67 has to be considered is the substance of the law and not its form. The question that is to be asked is : does the law in substance provide for transfer of ownership of property	 whatever be the linguistic formula employed ? What is the effect of the law : does it bring about transfer of ownership of property ? Now	 'transfer of ownership is also a term of wide import and it comprises every mode by which ownership may be transferred from one person to another. The mode of transfer may vary from one kind of property to another : it would depend on the nature of the property to be transferred. And moreover	 the court would have to look to the substance of the transaction in order to determine whether there is transfer of ownership involved in what has been brought about by the law. There is no doubt that in the present case the impugned Act extinguished or put an end to the debts due and owing from the Life Insurance Corporation to Class III and Class IV employees. that was the	 direct effect of. the impugned Act and it can	 therefore	 be legitimately said that in substance the impugned Act provided for extinguishment of these debts	 though it did not say so in so many words. This much indeed was not disputed on behalf of the Life Insurance Corporation and the controversy between the parties only centred round the question whether the extinguishment of these debts involved any transfer of ownership of property to the Life Insurance Corporation. The learned Attorney General on behalf of the Life Insurance Corporation sought to make a distinction between extinguishment and transfer of ownership of a debt and contended that when ownership of a debt is transferred	 it continues to exist as a debt in the hands of the transferee	 but when a debt is extinguished it ceases to exist as a debt and it is not possible to say that the debtor has become the owner of the debt. There can be no transfer of ownership of a debt	 said the learned Attorney General unless the debt continues to exist as such in the hands of the transferee	 and	 therefore	 extinguishment of a debt does not involve transfer of ownership of the debt to the debtor. This contention of the learned Attorney General	 though attractive at first blush	 is	 in our opinion not well founded. It is not correct to say that there can be no transfer of ownership of a right or interest unless such right or interest continues to have a separate identifiable existence in the hands of the transferee. It is not difficult to find instances where ownership of a right or interest may be transferred from one person to	 another by extinguishment. Take for example	 a case where the lessor terminates the lease granted by him to the lessee by exercising his right of forfeiture or the lessee surrenders the lease in favour of the lessor. The lease would in such a case come to an end and the interest of the lessee would be extinguished and correspondingly	 the reversion of the lessor would be enlarged into full ownership by the return of the leasehold interest. There would clearly be transfer of the lease hold interest from the lessee to the lessor as a result of the determination of the lease and the extinguishment of the interest of the lessee. The same would be the position where A law provides for cancellation	 of the lease and in such a case	 if the lessor is the State or a corporation owned or controlled by the State	 it would amount to compulsory acquisition of the leasehold interest of the lessees within meaning of clause (2A) of Article 31. It was in fact to held by this 368 Court and in our opinion rightly in Ajit Singh vs State of Punjab(1) where sikri	 J.	 speaking on behalf of the majority	 pointed out at page 149 that if "the State is the landlord of an estate and there is a lease of that property and a law provides for the extinguishment of leases held in an estate it would properly fall under the category of acquisition by the State because the beneficiary of extinguishment would be the State". Where by reason of extinguishment of a right or interest of a person	 detriment is suffered by him	 and a corresponding benefit accrues to the State	 there would be transfer of ownership of such right or interest to the State. The question would always be : who is the	 beneficiary of the extinguishment of the right or interest effectuated by the law? If it is the State	 then there would be transfer of ownership of the right or interest to the State 	 because what the owner of the right or interest would have lost by reason of the extinguishment would be the benefit accrued to the State. This was precisely the reason why Hegde	 J.	 speaking on behalf of the Court observed in the State of Madhya Pradesh vs Ranojirao Shinde (supra) that it was possible to view the abolition of cash grants under the Madhya Pradesh law impugned in that case "as a statutory transfer of rights of the grantees to the State". It was pointed out in that case that there was no difference between taking by the State of money that is in the hands of others and the abrogation of the liability of the State to make payment to others	 for in the former case the State would be compulsorily taking others ' property	 while in the latter it would be seeking to appropriate to itself the property of others which is in its hands. It is	 therefore	 clear that when a debt due and owing by the State or a corporation owned or controlled by the State is extinguished by law	 there is transfer of ownership of the money representing the debt from the creditor to the State or the State owned/controlled corporation. So long as the debt is due and owing to	 the creditor	 the State or the State owned/controlled corporation is under a liability to pay the amount of the debt to the creditor and	 therefore	 if the amount of the debt is X	 the total wealth of the creditor would be A plus X	 while that of the State or State owned/controlled corporation would be B minus X. But if the debt is extinguished	 the total wealth of the creditor would be reduced by X and that of the State or State owned/controlled corporation augmented by the same amount. Would this not be in substance and effect of transfer of X from the creditor to the State or State owned/controlled corporation ? The extinguishment of the debt of the creditor with corresponding benefit to the State or State owned/controlled corporation would plainly and indubitably involve transfer of ownership of the amount representing the debt from the former to the latter. This is the real effect of extinguishment of the debt and by garbing it in the form of extinguishment	 the State or State owned/controlled corpo ration cannot obtain benefit at the cost of the creditor and yet avoid the applicability of Article 31	 clause (2). The verbal veil constructed by employing the device of extinguishment of debt cannot be permitted to conceal or hide the real nature of the transaction. It is necessary to remember that we are dealing here with a case where a constitutionally guaranteed right is sought to be enforced and the protection of such right should not be allowed to be defeated or rendered illusory by legis 3 69 lative stratagems. The courts should be ready to rip open such stratagems and devices and find out whether in effect and substance the legislation trenches upon any fundamental rights. The encroachments on fundamental rights are often subtle and sophisticated and they are disguised in language which apparently seems to steer clear of the constitutional inhibitions. The need for a perspective and alert Bar is	 therefore	 very great and the courts too have to adopt a bold and dynamic approach	 if the fundamental rights are to be protected against dilution or erosion. In the light of this discussion	 the conclusion is inevitable that the direct effect of the impugned Act was to transfer ownership of the debts due and owing to Class III and Class IV employees in respect of annual cash bonus to the Life Insurance Corporation and since the Life Insurance Corporation is a corporation owned by the State	 the impugned Act was a law providing for compulsory acquisition of these debts by the State within the meaning of clause (2A) of Article 31. If that be so	 the	 impugned Act must be held to be violative of Article 31	 clause (2) since it did not provide for payment of any compensation at ail. for the compulsory acquisition of these debts. Re : Ground (B) Since the impugned Act has been held void as offending Article 3 1	 clause (2) under Ground (A)	 it is unnecessary to consider Ground (B) based on infraction of Article 19 ( 1) (f). It is the settled practice of this Court to decide no more than what is absolutely necessary for the decision of a case. Moreover	 once it is held that the impugned Act falls within Article 31	 clause (2)	 its validity cannot be tested by reference to Article 19 (1) (f) by reason of clause (2B) of Article 31. Hence we do not propose to discuss the very interesting arguments advanced before us in regard to Article 19 (1) (f). We accordingly allow the writ petitions and declare the Life Insurance Corporation (Modification of Settlement) Act	 1976 void as offending Article 31	 clause (2) of the Constitution and issue a writ of Mandamus directing the union of India and the Life Insurance Corporation to forebear from implementing or enforcing the provisions of that Act and to	 pay annual cash bonus for the years 1st April	 1975 to 3 1 st March	 1976 and 1 st April	 1976 to 3 1 st March	 1977 to	 Class III and Class IV employees in accordance with the terms of clause 8(ii) of the Settlement dated 24th January	 1974. The respondents will pay the costs of the writ petitions to the petitioners. ORDER We agree with the conclusion of Brother Bhagwati but prefer to rest our decision on the ground that the impugned Act violates the provisions of Article 31(2) and is	 therefore	 void. We consider it unnecessary to express any opinion on the effect of the judgment of the Calcutta High Court in W.P. No. 371 of 1976. P.B.R. Petitions allowed.

From time to time the Life Insurance Corporation and its employees arrived at settlement relating to the terms and conditions of service of Class III and Class IV employees including bonus payable to them. Clause (8) of the Settle ment dated January 24	 1974	 which related to payment of bonus	 provided (i) that no profit sharing bonus shall be paid but the Corporation may	 subject to such directions as the Central Government may issue from time to time	 grant any other kind of bonus to its Class III and Class IV employees; (ii) that an annual cash bonus will be paid to all Class III and Class IV employees at the rate of 15% of the annual salary actually drawn by an employee in respect of the financial year to which the bonus relates and (iii) that save as provided therein all other terms and conditions attached to the admissibility and payment of bonus shall be as laid down in the Settlement on bonus dated June 26	 1972. Clause (12) of the Settlement which refers to the	 period of settlement provided (1) that the Settlement shall be effective from April 1	 1973 for a period of four years and (2) that the	 terms of the Settlement shall be subject to the approval of the Board of the Corporation and the Central Government. One of the administrative instructions issued by the Corporation in regard to the payment of cash bonus under cl. 8(ii) of the Settlement was that in case of retirement or death	 salary up to the date of cessation of service shall be taken into account for the purpose	 of determining the amount of bonus payable to the employee or his heirs and the other was that the bonus shall be paid along with the salary for the month of April but in case of retirement or death	 payment will be made soon after the contingency. The payment of Bonus (Amendment) Act. 1976 considerably curtailed the rights of the employees to bonus in industrial establishments. But in so far as the employees of the Corporation were concerned this Act had no application because by reason of section 32 of the Payment of Bonus Act	 the Corporation was outside the purview of its operation. The Central Government however decided that the employees of establishments which were not covered by the Bonus Act would not be eligible for payment of bonus but exgratia payment in lieu of bonus would be made to them. Pursuant to this decision the L.T C. was advised by the Ministry of Finance	 Government of India	 that no further payment of bonus should be made to its employees without getting the same cleared by the Government. The Corporation accordingly issued administrative instructions not to pay bonus to its employees under the existing provisions until further instructions. To the employees ' assertion that the Corporation was bound to	 335 pay bonus in accordance with the terms of the Settlement the Corporation cOntended that payment of bonus by the Corporation was subject to such directions as the Central Government might issue from time to time	 and since the Central Government had advised it not to make any payment of bonus without its specific approval	 bonus could not be paid to the employees. Thereupon	 the All India Insurance Employees ' Association moved the High Court for issue of a writ directing the Corporation to act in accordance with the terms of the Settlement dated January 24	 1974 read with administrative instructions dated March 29	 1974 and not to refuse to pay cash bonus to Class III and Class IV employees. A single Judge of the High Court allowed the writ petition. While the Letters Patent Appeal was pending	 Parliament passed the Life Insurance Corporation (Modification of Settlement) Act	 1976 (which is the Act impugned in this case). In the Letters Patent Appeal the Corporation stated that in view of the impugned Act 	 there was no necessity for proceeding with the appeal and hence the Division Bench made no order in the appeal. Since the effect of the impugned Act was to deprive Class III and Class IV employees of bonus payable to them in accordance with the terms of the Settlement	 two of the associations filed writ petitions in this Court challenging the constitutional validity of the impugned Act. It was contended on their behalf that even if the impugned Act rendered cl. (8) (ii) ineffective with effect from April 1	 1975 it did not have the effect of absolving the Life Insurance Corporation from its obligation to carry out the writ of Mandamus issued by the High Court and (2) that the right of Class III and Class IV employees to annual cash bonus for the years 1975 76 and 1976 77 under Cl. 8(ii) of the Settlement was property and since the impugned Act provided for compulsory acquisition of this property. without payment of compensation	 it was violative of article 31(2) of the Constitution. Allowing the writ petitions Beg C.J. (concurring with the majority) HELD : Section 3 of the Life Insurance Corporation (Modification of Settlement) Act	 1976 is struck by the provisions of article 19(1)(f) and is not saved by article 19(6) of the Constitution. [346 A] 1. The Statement of Objects and Reasons of the Act discloses that the purpose of the impugned Act was to undo settlements arrived at between the Corporation and Class III and Class IV employees on January 24 and February 6	 1974 and recognised by the High Court. In Smt. Indira Gandhi vs Raj Narain this Court held that even a constitutional amendment cannot authorise the assumption of judicial power by Parliament. One of the tests laid down was whether the decision is of a kind which requires hearing to be given to the parties i.e.	 whether it involves a quasi judicial procedure. A decision reached by the Central Government is the result of a satisfaction on matters stated there and would imply quasi judicial procedure where the terms of a settlement had to be reviewed or revised. But	 the legislative procedure. followed in this case does not require that to	 be done. It would be unfair to adopt legislative procedure to undo a settlement which had become the basis of a decision of a High Court. Even if legislation can remove the basis of a decision it has to do it by an alteration of general rights of a class but not by simply excluding two specific settlements between the Corporation and its employees from the purview of section 18 of the which had been held to be valid and enforceable by a High Court. [341 G	 H	 342 A C] 2(a) The object of the Act was in effect to take away the force of the judgment of the High Court. Rights under that judgment could be said to	 rise independently of article 19	 of the Constitution. To give effect to that judgment is not the same thing as enforcing a right under article 19. It may be that a right under article 19 becomes linked up with the enforceability of the judgment. Nevertheless the two could be viewed as separable sets of rights. If the right conferred by the judgment independently is sought to be set aside section 3 would be invalid for trenching upon the judicial power. [343 B D] 336 (b) A restriction upon a right may even cover taking away of the right to increased remuneration in the interests of the general public. But the present is a pure and simple case of deprivation of rights of the employees without any apparent nexus with any public interest. In the instant case the impugned Act is a measure which seeks to deprive workers of the benefits of settlement arrived at and assented to by the Central Government under the provisions of the . Such a settlement should not be set at naught by an Act designed to defeat the purpose. In judging the reasonableness of an Act the prospects held out	 the representations made	 the conduct of the Government and equities arising therefrom may all be taken into consideration. [342 E F	 344 E F] 3. Even though the real object of the Act was to set aside the result of mandamaus	 the section does not mention this object. This was perhaps because the jurisdiction of a High Court and the effectiveness of its orders derived their force from article 226 of the Constitution. Even if section 3 seeks to take away the basis of the judgment without mentioning it	 yet where the rights of the citizens against the State are concerned the court should adopt an interpretation which upholds those rights. Therefore	 the rights which had passed into those embodied in a judgment and become the basis of a mandamus from the High Court	 could not be taken away in an indirect fashion. [343 D E]. Even though the Directive Principles contained in article 43	 cast an obligation on the State to secure a living wage for the workers and is part of the principles declared fundamental in the governance of the country	 it is not a fundamental right which can be enforced. Even though the Directive Principles give a direction in which the fundamental policies of the State must be oriented	 yet this Court cannot direct either the Central Government or the Parliament to proceed in that direction. Even if the Directives are not directly enforceable by a Court they cannot be declared ineffective. They have the life and force of fundamentals. The best way to give vitality and effect to them is to use them as criteria of reasonableness. [344 B C] 5(a) Articles 358 and 359(1A) provide that as soon as the Proclamation of emergency cease to operate the effect of suspension must vanish "except as respects things done or omitted to be done before the law so ceases to have effect. ' [346 B C] (b) The term "things done or omitted to be done"	 should be interpreted very narrowly. In the present case it means that the settlements are not to be deemed to be wiped off. All that it means is that no payment of bonus could be demanded during the emergency but as soon as the emergency was over	 the settlement would revive and what could not be demanded during the emergency would become payable even for the period of emergency for which payment was suspended. In other words valid claims cannot be washed off by the emergency per se. They can only be suspended by a law passed during the operation of articles 358 and 359(1A). [346 C F] (Per Chandrachud	 Fazal Ali and Shinghal	 JJ.). Concurring with the majority. The impugned Act violates article 31(2) and is	 therefore	 void. [369 G] (Per Bhagwati	 Iyer and Desai	 JJ.) Irrespective whether the impugned Act is constitutionally valid or not	 the Corporation is bound to obey the Writ of Mandamus issued by the	 High Court and to pay annual cash bonus for the year 1975 76 to Class III and Class IV employees. [352 D E] 1. Section 3 of the impugned Act merely provided that the provisions of the Settlement	 in so far as they related to payment of annual cash bonus to Class in and Class IV employees	 shall not have any force or effect and shall not be deemed to have had any force or effect from April 1	 1975. The writ of Mandamus issued by the High Court was not touched by the impugned Act. The right of the employees to annual cash bonus ' for the year 1975 76 became 337 crystallised in the judgment and this right was not sought to be taken away by the impugned Act. The Judgment continued to subsist and the corporation was bound to pay bonus in obedience to the writ of Mandamus. By the time the Letters Patent Appeal came up for hearing	 the impugned Act had already come into force and the Corporation could have successfully contended in the appeal that since the Settlement	 in so far as it provided for payment of annual cash bonus	 was annihilated by the impugned Act with effect from 1st April	 1975 and so the employees were not entitled to bonus for the year 1975 76 and hence no writ of Mandamus could issue against the Corporation directing it to make payment of bonus. If such contention had been raised	 there is little doubt that the judgment of the single Judge would have been upturned. But that was not done	 and the judgment of the single Judge became final and binding oil the parties. [353 A F	 355 C] Shri Prithvi Cotton Mills Ltd. vs Broach Borough Municipality	 [1970] 1 SCR 358 and Patel Gordhandas Hargovindas vs Municipal Commissioner	 Alimedabad	 ; ; distinguished and held inapplicable. 2(a). The argument on behalf of the Corporation that on a proper interpretation of the clauses annual cash bonus payable under cl. 8(ii) was	 by reason of cl. 8(i) subject to the directions issued by the Central Government from time to time and the Government having stopped further payment of bonus	 the employees were not entitled to claim annual cash bonus	 is erroneous. The employees had absolute right to receive annual cash bonus from the Corporation in terms of el. 8(ii) and it was not competent to the Central Government to issue any directions to the Corporation to refuse or withhold payment of the same. [356 D H] (b) Although under regulation 58 of the Service Regulations non profit sharing bonus could be granted subject to the directions of the Central Government and if the Government issues a direction to the contrary bonus could not be paid by the Corporation	 in the instant case	 as provided in cl. 12 of the Settlement	 the Central Government approved the payment of bonus under cl. 8(ii). That having been done it was not competent to the Central Government thereafter to issue another contrary direction which would have the effect of compelling the Corporation to commit a breach of its obligation under section 18(1) of the to pay annual cash bonus under clause 8(ii). The overriding power given to the Central Government to issue directions from time to time contained in cl. 8(i) is conspicuously absent in cl. 8(ii). The power contained in cl. 8(i) cannot be projected or read into cl. 8(ii). These two clauses are distinct and independent. While cl. 8(i) is a general provision	 el. 8(ii) specifically provides that cash bonus in the manner prescribed therein shall be paid to the employees. This specific provision is made subject only to the approval of the Central Government	 which was obtained. [357 A F] (c) Moreover	 under cl. 8(ii) read with the administrative instruction issued by the Corporation	 annual cash bonus accrued from day to day	 though payable in case of retirement	 resignation or death on the happening of that contingency and otherwise on the expiration of the year to which the bonus related	 Thus the annual cash bonus payable for the year 1975 76 was a debt due and owing from the Corporation to each of the employees. 	 On the date when the impugned Act came into force each of the employees was entitled to a debt due and owing to him from the Corporation. [357 H	 358 A] 3(a) The impugned Act must be held to be violative of article 31(2) since it did not provide for payment of any compensation for the compulsory acquisition of the debts. [369 C] (b) The direct effect of the impugned Act was to transfer ownership of the debts due and owing to Class III and Class IV employees in respect of cash bonus to the Life Insurance Corporation and since the Corporation is a Corporation owned by the State	 the impugned Act was a law providing for compulsory acquisition of the debts by the State within the meaning of article 31(2A). 1369 B C] 338 (c) Choses in action can be acquired by the State. So long as the acquisition sub serves a public purpose	 it would satisfy the requirement of article 31(2). There is a fundamental distinction between a chose in action and money. A chose in action has not the same mobility and liquidity as money	 and its value is not measured by the amount recoverable under it but depends on a variety of factors. Where money is given as compensation for taking money the theory of forced loan may apply	 but it is not applicable where a chose in action is taken and money representing its value is given as compensation. [363 A	 D F] R. C. Cooper vs Union of India	 ; ; Madhav Rao Scindia vs Union of India : ; reiterated. State of Bihar vs Kameshwar Singh	 ; State of Madhya Pradesh vs Ranojirao Shinde	 ; ; dissented; Deokinandan Prasad vs State of Bihar	 [1971] Suppl. S.C.R. 634; State of Punjab vs K. R. Erray & Sobhag Rai Mehta	 ; ; State of Gujarat	 vs Sri Ambica Mills Ltd.	 ; and Slat(	 of Kerala vs The Gwalior Rayon Silk Mfg. (Wvg.) Co. Ltd.	 ; followed; State of Madhya Pradesh vs Ranojirao Shinde	 [1968] 3 S.C.R. 489; State of Bihar vs Kameshwar Singh	 and Bombay Dyeing and Manufacturing Co. Ltd. vs State of Bombay	 ; explained; ; and ; held no longer good law. (d) The debts due and owing from the Corporation in respect of annual cash bonus were clearly property of the employees within the meaning of article 31(2) and they could be compulsorily acquired under article 31(2). Similarly their right to receive cash bonus for the period from the date of commencement of the impugned Act upto March 31	 1977 was a legal right enforceable through Court of law. [360 B C] (a) Property within the meaning of articles 19(1)(f) and 31(2) comprises every form of property	 tangible or intangible	 including debts and choses in action such is unpaid accumulation of wages	 pension	 cash grants etc. [360 A] R. C. Cooper vs Union of India	 ; ; H. H. Maharajadhiraja Madhay Rao Jiwaji Rao Scindia Bahadur & Ors. vs Union of India; 	 ; State of M.P. vs Ranojirao Shinde & Anr.	 ; ; Deokinandan Prasad vs State of Bihar	 [1971] Supp. S.C.R. 634; State of Punjab vs K. R. Erry & Sobhag Rai Mehta	 [1973] 2 S.C.R. 485; and State of Gujarat & Anr vs Shri Ambica Mills Ltd.	 Ahmedabad	 ; referred to. 4(a) The contention of the Corporation that when ownership of a debt is transferred it continues to exist as a debt but that when the debt is extinguished it ceases to exist as a debt and that extinguishment of a debt does not therefore involve transfer of ownership of the debt to the debtor is not well founded. Where	 by reason of extinguishment of a right or interest of a person	 detriment is suffered by him and a corresponding benefit accrues to the State	 there would be transfer of ownership of such right or interest to the State. The question would always be : who is the beneficiary of the extinguishment of the right or interest effectuated by the law ? If it is the State	 then there would be transfer of ownership of the right or interest to the State	 because what the owner of the right or interest would lose by reason of the extinguishment would be the benefit accrued to the State [367 H	 368 B C] (b) Extinguishment of the debt of the creditor with corresponding benefit to the State or State owned/controlled Corporation would involve transfer of ownership of the amount representing the debt from the former to the latter. This is the real effect of extinguishment of the debt and by garbing it in the form of extinguishment	 the State or State owned/controlled Corporation cannot obtain benefit at the cost of the creditor and yet avoid ' the applicability of 339 article 31(2). The verbal veil constructed by employing the device of extinguishment of debt cannot lot permitted to conceal or hide the real nature of the transaction [368 F B]