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A 5-judge Constitution Bench of the Supreme Court has doubted the correctness of the Aadhaar judgment in relation to the question of passage of Aadhaar Act as a Money Bill.
A larger Bench of 7 judges will now decide the correctness of the Aadhaar judgment.
The Finance Act 2017 which brought in provisions concerning the functioning of tribunals was challenged on the ground that it was passed a money bill.
It was the argument of the petitioners that the same was not a money bill and passing the same couching it as a money bill was done to circumvent the Rajya Sabha.
The Central government had, in turn, placed reliance on the Aadhaar judgment to make its case. This led to the Court examining the Aadhaar judgment in detail particularly in relation to Article 110 of the constitution which defines “money bills”
The Supreme Court today stated that the majority judgment in Aadhaar did not elucidate and explain the scope and ambit of sub-clauses (a) to (f) to clause (1) of Article 110 of the Constitution, a legal position and facet which arises for consideration in the present case and assumes considerable importance.
Regarding the concurring opinion of Justice Ashok Bhushan in Aadhaar case, the Court today held that the said judgment was based on the dominant purpose test.
Justice Ashok Bhushan in his judgment had referred to the definition of “Money Bill” and the meaning and purpose of the word ‘only’ used in Article 110(1) of the Constitution. He had held that the legislative intent was that the main and substantive provision of an enactment should only be any or all of the sub-clauses from (a) to (f). Only if the main or substantive provisions of the Act are not covered by sub-clauses (a) to (f), the bill cannot be said to be a “Money Bill”.
It was further observed that the use of the word ‘only’ in Article 110(1) has its purpose, which is clear restriction for a bill to be certified as a “Money Bill”. Since Aadhaar Act veers around the government’s constitutional obligation to provide for subsidies, benefits and services to individuals and other provisions are only incidental provisions to the main provision. Therefore, the Aadhaar Bill was rightly certified by the Speaker as a “Money Bill”, he had held.
However, the Supreme Court today noted that the test of dominant purpose has its own limitation. Many a legislation would have more than one dominant objective especially when this prescription is read with reference to sub-clauses (a) to (f) of Article 110(1) of the Constitution.
“Further, determination of what constitutes paramount and cardinal purpose of the legislation and the test applicable to determine this compunction and incertitude itself is not free from ambiguity”
The Court also adverted to the minority judgment of Justice DY Chandrachud who had held that Section 7 of the Aadhaar Act did not have the effect of making the bill a Money Bill as it did not declare the expenditure incurred on services, benefits or subsidies to be a charge on the Consolidated Fund of India. Section 7 mandates Aadhaar for availing services, benefits or subsidies which were already charged to the Consolidated Fund of India, Justice Chandrachud had ruled.
The Court concluded that the majority judgment in the Aadhaar case pronounced the nature of the Aadhaar act without first delineating the scope of Article 110(1) and principles for interpretation or the repercussions of such process. The majority dictum in Aadhaar judgment did not substantially discuss the effect of the word ‘only’ in Article 110(1) and offers little guidance on the repercussions of a finding when some of the provisions of an enactment passed as a “Money Bill” do not conform to Article 110(1)(a) to (g), the Court ruled.
“Upon an extensive examination of the matter, we notice that the majority in K.S. Puttaswamy (Aadhaar-5) pronounced the nature of the impugned enactment without first delineating the scope of Article 110(1) and principles for interpretation or the repercussions of such process. It is clear to us that the majority dictum in K.S. Puttaswamy (Aadhaar-5) did not substantially discuss the effect of the word ‘only’ in Article 110(1) and offers little guidance on the repercussions of a finding when some of the provisions of an enactment passed as a “Money Bill” do not conform to Article 110(1)(a) to (g). Its interpretation of the provisions of the Aadhaar Act was arguably liberal and the Court’s satisfaction of the said provisions being incidental to Article 110(1)(a) to (f), it has been argued is not convincingly reasoned, as might not be in accord with the bicameral Parliamentary system envisaged under our constitutional scheme.”
The Court stated that it is not expressing a firm and final opinion but since the Aadhaar judgment was also rendered by a Bench of coordinate strength, the correctness of the same needs to be determined.
“Without expressing a firm and final opinion, it has to be observed that the analysis in K.S. Puttaswamy (Aadhaar-5) 59 makes its application difficult to the present case and raises a potential conflict between the judgements of coordinate Benches. 123. Given the various challenges made to the scope of judicial review and interpretative principles (or lack thereof) as adumbrated by the majority in K.S. Puttaswamy (Aadhaar-5) and the substantial precedential impact of its analysis of the Aadhaar Act, 2016, it becomes essential to determine its correctness.”
It, therefore, ordered that the matter in relation to the passage of Finance Act be placed before a larger Bench.
“Being a Bench of equal strength as that in K.S. Puttaswamy (Aadhaar-5), we accordingly direct that this batch of matters be placed before Hon’ble the Chief Justice of India, on the administrative side, for consideration by a larger Bench.”