LACHHMAN DAS ON BEHALF OF FIRM TILAK RAM RAM BUX versus STATE OF PUNJAB AND OTHERS

Citation: [1963] 2 S.C.R. 353 · Decided: 23-04-1962 · Supreme Court of India · Bench: T.L. VENKATARAMA AIYYAR · Disposal: Dismissed

Cited by 11 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

I 
2 S.C.R. 
SUPREME COUR'l' REPORTS 
LACHHMAN DAS ON BEHALF OF FIRM 
TILAK RAM RAM BUX 
v. 
STATE OF PUNJAB AND OTHERl3 
[And Connected Petition And Appeals]. 
353 
(B. P. SINHA, c. J., K. SUBBA RAO, N. RAJAGOPALA 
AYYANGAR, J. R. MUDHOLKAR and T. L. 
'{ 
VENKATARAMA AIYAR, JJ.) 
81,ate Ban/c-State Dues-Determination and reoovery-
Statute providing for special procedure-Constitutional validity-
Merger of States-Powers of Rule.,, of erstwhile States after 
meger-Enactment, 
if in force-Patiala Reoovery of State 
Dues Act, JV of 2002 BK, ss. 2, 3, 4, 5, · 6, 11-0onsUtution of 
India, Arts. 14, 19(1) (!), 19(1) (g), 363. 
On May 5, I948, the rulers of .eight States, including the 
States of 
Patiala and Nabha, entered into a covenant 
merging all the said States for the establishment of a new 
State, called the Pepsu Union. By Art. VI of the covenant 
all the rights, authority and jurisdiction of the Ruler in 
relation to Government was vest in the Union. 
The exe .. 
cutive authority of the State was to vest in the Rajpramukh. 
Article X provided that "until a constitution framed by the 
Constituent Assembly comes into operation .. the Raj Pramukh, 
shall have power to make and promulgate ordinance for the 
peace and good Government of the, Union or any part there-
of, and any ordinance so ruade shall, for the space of not more 
than six mcnths from its promulgation have the like force of 
law as an Act passed by the Constituent Assembly .... " The 
new State came into existence on August 20, 1948, with the 
Ruler of Patiala as its Raj Pralnukh. On the same date he 
issued an Ordinance applying all the laws obtaining· in the 
State of Patiala to the entire territories of the new State, and 
as this Ordinance would have expired on February·20, 1948, 
he promulgated another Ordinance on February 15, 1949, on 
the same terms as the previous one. 
On April 9, 1949, all the 
Rulers entered into a Supplementary Covenant, whereby Art.X 
was amended by omitting the words " for the space of not 
more than six months from its promulgation." The object of 
this was to continue in force all the laws which had been 
brought into forC'e by the Ordinances until repealed by fresh 
legislation. After the Constitution of India came into force 
Pepsu became a Part B State, and subsequently under the States 
Reorganisation Act, 1956, Prpsu became part of the State of 
1961 
364 
SUPREME COURT REPORTS (1963] 
116! 
Punjab, and all the laws in force in Pepsu continued to have 
force in that area. 
J..aclrllmon Doi tm 
behlJlj of Finn 
Tilok Rom Rom Bux 
v. 
Sfot1 of Punj,b 
The Patiala State Bank was established in 1917 by the 
then Ruler of the State of Patiala. The appellant had an 
account in one of the branches of the Bank in the State of 
Patiala, while the petitioner, in the connected case, had a 
similar account in a Branch of the Bank in the State of 
Nabha. 
The amounts due under the aforesaid accounl3 were 
outstanding after the Constitution of India had come into 
force. 
The Bank proceeded to realise the same in accordance 
with the provisions of the Patiala Recovery of State Dues Act, 
IV of 2002(BK), and the Rul<s framed thereunder. This Act, 
had been enacted by the State of Patiala before it was merged 
in the new State. Under s .. 3 of the Act debts due to the 
Paliala State Bank were included in the definition clause as 
•State Dues', and s. 4 authorised the Managing Director of the 
PatiaJa State Bank to determine the exact amount of State 
dues recoverable from the defaulter, while s. 5 enacted that 
State dues may be recovered as if they were arrears of land 
revenue. 
Under s. 6 a certificate issued by the Managing 
Director of the Bank as to the amount of State dues was con-
clusive proof of the matter.; stated thereiO: and s. 11 barred the 
jurisdiction of the Civil Court in respect of the matters en-
trusted to the Managing Director under the Act and rules 
framcd under the act. The appellants challcnged the validity 
of the Act and the proceedings 
taken thereunder on the 
f.'TOunds (I) that the Act had ceased to be in force ~n the 
expiry c;f the six months of the Ordinance issued by the Raj 
Pramukh on February 15, 1949, because the Rulers had on 
power to enter into the Supplementary Convenant after they 
had surrendered completely all their sovereign powers to the 
new State by the Convenant dated May 5, 1 !K8, and had 
therefore, no competence to confer on the Raj Pramukh any 
authority to legislate; and (2) 

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