LexDR. INDRAMANI PYARELAL GUPTA versus W.R. NATHU AND OTHERS.
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• I I \ \ I I < - 1 S.C.R . SUPR.EME UOL 1RT REPORTS 721 l>R. INDRAMANI PYARELAL GTJP1 1A v. W.R. NATHU AND OTHERS. - (B. P. SINHA, c. J., K. SUBBA RAO, N. RAJ.A.GOP.A.LA AYYANG.A.R, J. R. MunHOLKAR and T. L. VENXA.T.A.RA.M.A. A!Y.A.R, JJ.} Forward Oontracts-Regulation of-Bye-laws empowering cloaing out of hedge contracta--Validity of-If can operate retrospectively-East India Ootton As1ociation Bye-laws cl. 62.A-Forward Contracts (Regulation) Act, 1962 (LXXIV of 1962), ss. 4, 11 and 12. The appellants were members of the East India Cotton Association which was an association recognised by the Cen• tral Government under the Forward Markets Regulation Act, 1952. Prim to December 1955, they had entered into "hedge contracts" in respect of cotton for settlements in February and May 1956 in accordance with the bye-laws of the Associa· tion. Towards tb.e end of 1955 it was apprehended that the forward market in cotton was heading for a crisis aud the Central Government issued notifications directing the Asso- ciation to suspend business in hedge contracts for February and May 1956 deliveries for short periods this did not improve the situation. On January 21, 1956, the Central Govern· ment, acting under s. 12 of the Act, made a new bye-law in substitution of bye-Jaw 52AA of the Association which em- powered the Forward Markets Commission, constituted under, the Act, to issue a notification tlosing out all hedge contracts at rates fixed by the Commission. On January 24, 1956, the Commission issued a notification closing out all hedge contracts including those subsisting on that date, and fixed the rates for the settlement of such contracts. The appellants contended that the amended bye.law 52AA was invalid as the power to close out hedge contracts could not be conferred upon the Commission and as the Association was in law incapable of conferring such a power on the Commission or on any other body and that in any cases the bye-law could not operate retrospectively so as to affect existing contracts. Held, (per Sinha, C. J., Ayyangar, Mudholkar and Aiyar, JJ. Subba Rao, J. contra), that the amended bye-law 52AA was not ultra virc1 the Central Government and validly empowered the Commission to close an hedge contracts in cotton including existing contracts. Clause (f) of 1, .f. of the Act provided that one of the functions of the Commission ~9G2 Dr. lnbom1r.i p_,..,1.1 Gupta v. W.R. N itllu 722 SUPREME COURT REPORTS [1963] shall be to perform such other duties and exercise such other powers as may be assigned to the Commission "by or under the Act, as may be prescribed". There was no limitation upon the nature of the power that may be conferred under cl. (f) except that . it must be in relation to the regulation of forward trading in goods. It was not possible to place any limitation on this power by invoking the rule of •jU11dt.m v•neri• as there was no common positive thread running through els. (a) to (e) of s. 4. To judge whether legally a rower could be rested in a statutory body the proper rule o interpreta- tion was that unless the nature of the power was such as to be inconsistant with the purpose for which the body was created or unless the particular power was contra-indicated by any specific provisions of the Act, any power which fur· thered the provisions of the Act could be legally conferred. Judge by this test the power conferred by the bye-law could be validly vested in the Commission. The power was one conferred ''under the Act 0 • The words "under the Act 0 signified a power conferred by laws made by a subordinate Jaw-making authority which was empowered to do so by the Act. The impugned bye-law was clearly well within the bye-Jaw making power under ••· 11 and 12. The bye-law did not contravene article.• 64 of the Articles of Association of the Association as articles 64 applied only to the Board and placed no restrictions on the power of the Association. We•tern India Thtatro• Ltd. v. Municipal Oorporaticn o/ Poona, [1959] Supp. 2 S.C.R. 71, Huhli Electricity Oo. Ltd. v. Province of Bombay, 76 I.A. 57 and NarayanasUJamy Naidu v. Krish11aMu,thi, I.L.R. 1958 Mad. 513, referred to. ' Further, upon a proper construction of the amended bye-law it applied not only to contracts to be entered into in future but also to subsisting contracts. A statute which could validly enact a law with retrospective effect could in express ter
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