UNION OF INDIA versus STATE OF RAJASTHAN

Citation: [1985] 1 S.C.R. 700 · Decided: 04-09-1984 · Supreme Court of India · Bench: O. CHINNAPPA REDDY · Disposal: Dismissed
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Judgment (excerpt)

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700 
UNION OF INDIA 
v. 
STATE OF RAJASTHAN 
September 4, 1984 
[0. CHINNAPPA REDDY, A.P. SEN & E.S. VENKATARAMIAH, JJ.] 
C1J11stltution of India-Artical 131-0riginal jurisdf,;tion ofthe Supreme 
Court-Scope of-Jurisdiction when attracted. Held: attracted only when dispute 
arises between or amongst the States and the Union of India in the context of the 
constitutional relationship that exists between them and the powers, ri'ghts, duties, 
fmmunities, liabilities, disabilities, etc., flowing therefrom. 
Whethef a suit filed 
by the State against the Union of India for recovery of compensation for loss on 
account of da1nage caused to goods despatched through the b1dfan Railways could 
be filed in a civil court-Whether suit Maintainable. Held: yes. 
Indian Railways Act, 1890-Section 80-Suit filed under section 80 is one 
b~tween Railway Administration and the person instituting the suit even though 
Union of India is impleaded as a party. 
The respondent, State of Rajasthan through its District Rehabilitation 
Officer, Barmer filed a suit in the court of the District Judge, Balotra against 
the appellant, Union of India, and the Railway Adrr1inistration claiming 
damages for the loss suffered by it on account of the damage caused to the 
goods transported by rail through the Railway Administration. The appellant 
contended that the suit was not maintainable in the District Court in view of 
Article 131 of the Constitution which, according to it conferred exclusive 
jurisdiction on the Supreme Court to decide all disputes arhing b_etween a State 
and the Union. The District Judge held that he hadjurisdii;tion to try the suit. 
A Revision Petition filed against the order of the District Judge was dis1nissed 
by the High Court. Hence this petition for special leave to appeal. 
Dismissing the petition, 
HELD : The suit was entertainable by the District Court. 
On a careful consideration of the whole matter in the light of the decisions 
of this Court, it is felt that Article 131 of the Constitution is attracted only when 
a dispute arises between or amongst lthe States and the Union in the context of 
the constitutional relationship that exists between them and the powers, rights, 
duties. immunities, liabilities, disabilities etc. flowing the[efrom. Any dispute 
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UNION V. RAJASTHAN 
701 
which may arise between a State in the capacity of an employer in a factory, a 
manufacturer of goods subject to exercise duty, a holder of a permit to run a 
stage carriage, a trader or businessman carrying on business not incidental to 
the ordinary functions of Government, a consumer of railway services. etc. like 
any other private party on the one hand and the Union of India on the other 
Cannot be construed as a dispute arising between the State and the Union in 
discharge of their respective executive powers attracting Article 131 of the 
Constitution. It could never have been the intention of the framers of the 
Constitution that any ordinary dispute of this nature would have to be decided 
exclusi•ely by the Supreme Court. [708G·H ; 709A-BJ 
State of Bihar v. Union of India & Anr., [1970] 2 S.C.R. 522, Union of 
India y, State of Mysore, [1977] S.C.R. 842. Stale of Mysore v. Union of India 
& Ors. · A.I.R. 1968 Mysore 237 at pages 239-240, State of Rajasthan & Ors., 
etc. v. Union of India etc. etc., [1978J l S.C.R. 1. State of Karnataka v. Union of 
India & Anr., !1978] 2 S.C.R. l at page 92 and The Framing of India's Constitu-
tion-A Study by Shri B. Shiva Rao at page 483, referred to. 
In the instant case, the State Government has made a claim like any 
other consignee of goods despatched through the railway for compensation and 
its success or failure in the suit depends on proof of facts which have to be 
established in the same way in which a private person would have to establish. 
This is not even a case where a forrn:il contract is entered into between the 
Union of India and the State of Rajasthan in _accordance with the requirements 
of Article 299 of the Constitutlon. It is just a commercial contract under which 
an officer of the State of Rajas than was entitled to claim delivery of the goods 
consigned as any ordinary consignee. The claim involved in this case is one 
based on section 80 of the Indian Railways Act, 1890; Section 80 of the Indian 
Railways Act, 1890 indicates that the claim made under it is essentially against 
the Railway Administration
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