Partial Upholding of Part IXB: Severability and Ratification in Union Of India v. Rajendra N. Shah And Another (2021 INSC 340)

Introduction

The case of Union Of India v. Rajendra N. Shah And Another (2021 INSC 340), adjudicated by the Supreme Court of India on July 20, 2021, addresses the constitutional validity of the Constitution (Ninety-Seventh Amendment) Act, 2011. This amendment introduced Part IXB under the Constitution, focusing on cooperative societies. The central question revolved around whether Part IXB was constitutionally valid without ratification by at least half of the State Legislatures as mandated by the proviso to Article 368(2) of the Indian Constitution. The Gujarat High Court had previously declared Part IXB unconstitutional for lack of ratification, excluding its applicability to cooperative societies within States but not affecting multi-State cooperative societies or those in Union Territories. The Supreme Court's decision further clarified these boundaries.

Summary of the Judgment

The Supreme Court upheld the Gujarat High Court’s declaration that certain provisions of Part IXB were unconstitutional due to non-compliance with the ratification requirement under Article 368(2) proviso. Specifically, the provisions concerning cooperative societies within individual States were struck down. However, the Court upheld the applicability of Part IXB to multi-State cooperative societies and those in Union Territories, invoking the doctrine of severability. This means that while portions of the amendment were declared invalid, other parts that could stand independently remained in force.

Analysis

Precedents Cited

The judgment heavily referenced prior Supreme Court decisions that establish the principles of constitutional amendments, federalism, and the doctrine of severability. Key cases include:

• Sankari Prasad Singh Deo v. Union of India (1952 SCR 89): Addressed the necessity of ratification for constitutional amendments affecting federal structure.
• Sajjan Singh v. State of Rajasthan (1965) 1 SCR 933: Reinforced the requirement of ratification under Article 368(2) proviso for certain amendments.
• Kihoto Hollohan v. Zachillhu (1992 Supp (2) SCC 651): Explored the doctrine of severability in constitutional amendments, allowing parts of an amendment to be upheld even if other parts are invalidated.
• Builders' Association Of India v. Union Of India (1989) 2 SCC 645: Discussed the application of the non-obstante and 'subject to' clauses in Article 246 concerning the distribution of legislative powers.
• Minerva Mills Ltd. v. Union of India (1980) 3 SCC 625: Established that certain constitutional principles form the ‘basic structure’ which cannot be altered by amendments.

These precedents collectively guided the Court’s approach to evaluating whether the Constitution (Ninety-Seventh Amendment) Act, 2011 adhered to procedural requirements and respected the federal balance inherent in the Constitution.

Legal Reasoning

The Court's analysis centered on two main legal principles:

• Ratification Requirement under Article 368(2) Proviso: The amendment sought to introduce Part IXB concerning cooperative societies. As this affects Article 246 (Legislative Relations between Union and States) and Entry 32 of the State List in Schedule VII, ratification by at least half of the State Legislatures was mandatory. The absence of such ratification rendered these provisions unconstitutional, as they curtailed the State Legislatures’ exclusive powers over cooperative societies.
• Doctrine of Severability: While Part IXB had overall invalid aspects due to procedural lapses, the Court applied the doctrine of severability to uphold sections pertaining to multi-State cooperative societies. Since these sections were distinct and independent, they could function without dependency on the defective parts related to state-specific societies.

The Court meticulously evaluated whether the invalid portions of the amendment could be severed without affecting the operability of the remaining provisions. The principle established in Kihoto Hollohan was pivotal, ensuring that constitutional amendments could retain valid sections even when parts fail judicial scrutiny.

Impact

The Supreme Court’s decision has significant implications for constitutional amendments in India, particularly regarding federalism and the procedural adherence required for certain types of amendments. Key impacts include:

• Clarification on Ratification: Reinforces the necessity of ratification by State Legislatures for constitutional amendments affecting the federal balance, preserving the autonomy of States in their legislative domains.
• Doctrine of Severability Reinforcement: Affirms that portions of constitutional amendments can be upheld if they are independent and workable, even if other parts fail due to procedural deficiencies.
• Application to Cooperative Societies: Establishes that while States retain exclusive legislative power over cooperative societies, multi-State cooperative societies fall under Union legislative purview, promoting uniform regulation for entities operating across multiple jurisdictions.
• Legal Precedent: Acts as a guiding case for future challenges concerning the constitutional validity of amendments, particularly those impacting the legislative powers of States and maintaining the federal balance.

Complex Concepts Simplified

Article 368(2) Proviso

Article 368 of the Indian Constitution empowers Parliament to amend the Constitution. The proviso to Article 368(2) specifies that if an amendment affects certain key parts of the Constitution, including the federal structure (such as legislative relations under Article 246 and lists under Schedule VII), it must be ratified by at least half of the State Legislatures through resolutions before being presented to the President for assent. This ensures that significant changes to the Constitution receive consensus from both central and state governments, maintaining the federal balance.

Doctrine of Severability

The doctrine of severability allows courts to strike down only the unconstitutional portions of a statute or amendment while upholding the rest, provided the valid parts can stand independently. This prevents invalidating the entire law due to part of it being unconstitutional, promoting legal stability and continuity.

Federal Supremacy Principle

Under the Constitution, certain legislative subjects are reserved exclusively for the Union or State Legislatures, as detailed in the Seventh Schedule. The federal supremacy principle ensures that in cases of overlapping legislative domains, the Union’s laws prevail, maintaining a balance in the federal structure.

Conclusion

The Supreme Court's ruling in Union Of India v. Rajendra N. Shah And Another (2021 INSC 340) underscores the constitutional safeguards designed to preserve the federal structure of India. By upholding portions of the Constitution (Ninety-Seventh Amendment) Act, 2011 applicable to multi-State cooperative societies while invalidating others due to procedural lapses, the Court has reinforced the importance of adhering to prescribed amendment procedures. This judgment not only reaffirms the central role of State legislatures in their domains but also highlights the judiciary’s role in ensuring constitutional conformity in legislative processes. Moving forward, this decision will serve as a pivotal reference for assessing the validity of constitutional amendments, particularly those impacting the legislative powers and maintaining the federal balance between the Union and the States.