THE SECRETARY TO GOVT. OF KERALA, IRRIGATION DEPARTMENT AND OTHERS versus JAMES VARGHESE AND OTHERS

Citation: [2022] 3 S.C.R. 389 · Decided: 04-05-2022 · Supreme Court of India · Bench: L. NAGESWARA RAO · Disposal: Disposed off

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Judgment (excerpt)

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   [2022] 3 S.C.R. 389
389
THE SECRETARY TO GOVT. OF KERALA, IRRIGATION
DEPARTMENT AND OTHERS
v.
JAMES VARGHESE AND OTHERS
(Civil Appeal No. 6258 of 2014)
MAY 04, 2022
[L. NAGESWARA RAO AND B. R. GAVAI, JJ.]
Kerala Revocation of Arbitration Clauses and Reopening of
Awards Act, 1998 – Constitutional validity of – Challenged, on
ground of legislative competence of the State Legislature –
Agreements relating to a State Irrigation Project – Disputes –
Arbitration references – State enacted Kerala Act of 1998 which
provided for cancellation of arbitration clauses in the agreements,
revocation of authority of the arbitrators appointed thereunder and
filing of appeals against awards or decrees already passed in certain
arbitration references in respect of which period of limitation had
expired – Whether the State Legislature had the legislative
competence to enact the Kerala Act of 1998 – Held: The Kerala Act
of 1998 in pith and substance is referable to Entry 13 of List III of
Seventh Schedule to the Constitution and not to the Entries 12, 13,
14 and 37 of List I of the Seventh Schedule nor to Art.253 of the
Constitution – The Kerala Act of 1998, therefore, is within the
legislative competence of the State Legislature – In any case, in
view of the Presidential assent u/Art.254(2) of the Constitution, the
Kerala Act of 1998 would prevail within the State of Kerala –
Constitution of India, 1950 – Seventh Schedule, List III, Entry 13
and Art.254(2) – Arbitration Act, 1940 – Doctrines / Principles –
Doctrine of pith and substance.
Kerala Revocation of Arbitration Clauses and Reopening of
Awards Act, 1998 – Constitutional validity of – Challenged, on
ground of encroachment upon judicial powers of the State –
Agreements relating to a State Irrigation Project – Disputes –
Arbitration references – State enacted Kerala Act of 1998 which
provided for cancellation of arbitration clauses in the agreements,
revocation of authority of the arbitrators appointed thereunder and
filing of appeals against awards or decrees already passed in certain
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SUPREME COURT REPORTS
[2022] 3 S.C.R.
arbitration references in respect of which period of limitation had
expired – Whether the Kerala Act of 1998 encroached on judicial
powers of the courts and as such, was hit by the doctrine of
separation of powers – Held: Though a law enacted by the
Legislature may apparently seem to be within its competence but yet
in substance if it is shown as an attempt to interfere with the judicial
process, such law may be invalidated being in breach of doctrine
of separation of powers – The Kerala Act of 1998, which has the
effect of annulling the awards which have become “Rules of Court”,
is a transgression on the judicial functions of the State and therefore,
violative of doctrine of “separation of powers” – The Kerala Act of
1998 encroaches upon the judicial powers of the State and is
therefore liable to be struck down as being unconstitutional on this
count – Doctrines/Principles – Doctrine of “separation of powers”.
Constitution of India, 1950 – Seventh Schedule, List III, Entry
13 –Arbitration – Legislative competence of the State Legislature –
Held: The subject of arbitration finds place in Entry 13 of List III,
i.e., the Concurrent List of the Seventh Schedule to the Constitution
– Since the subject of arbitration is in the Concurrent List, the State
can also make a law with regard to the same.
Constitution of India, 1950 – Art.254, clause (2) – Conflict
between the Central law and the State law – Held: Ordinarily, if
there is any conflict between the Central law and the State law, in
view of clause (1) of Art.254, the Central law would prevail –
However, in view of clause (2) of Art.254, the State law would prevail
when it is reserved for consideration and receives assent of the
President of India.
Legislature – State Legislature – Legislative competence of –
Challenge to, on ground that it encroached upon the legislative
competence of the Parliament – Held: In such a situation, the
doctrine of pith and substance has to be applied to determine as to
which entry does a given piece of legislation relate to – Once it is
so determined, any incidental trenching on the field reserved to the
other legislature is of no consequence – Predominance of the Union
List would not prevent the State Legislature from dealing with any
matter within List II, though it may incidentally affect any item in
List I – If the State is competent to 

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