JUDGMENT
S.P. Bharucha, J.
1. Bennett Coleman and Co. Ltd. (hereinafter called “the company”) publishes the newspapers “The Times of India” and “Nav Bharat Times”. In 1983, company called Jansevak Karyalaya Ltd. (Jansevak) entered into negotiations with the company for printing and publishing editions of The Times of India and Nav Bharat Times from a press to be established at Lucknow. Three agreements dated June 4, 1983, July 30, 1983 and October 1, 1983 were entered into. In pursuance of the agreement, necessary applications were made under the Press and Registration of Books Act, 1867. On October 17, 1983, the first edition of the The Times of India and Nav Bharat Times were issued from Lucknow. The City Magistrate at Lucknow commenced proceedings under the Press and Registration of Books Act it regard to complaints received that the provisions of that Act had been contravened. These proceedings were stayed in a writ petition filed by Jansevak in the High Court at Calcutta. The stay order with slight modifications, remains operative, and the writ petition is yet to be disposed of.
2. The appellants by their letter dated October 5, 1983 asked the company to explain, in view of complaints that had been received why prior approval under section 22 of the Monopolies and Restrictive Trade Practices Act, 1969 (hereinafter called “the Act”) had not been obtained before the company had set up the new undertaking at Lucknow. The company relied. It was then served with a notice to show cause why penal action should not be taken against it for violation of the provisions of the Act. The company showed cause. By his order dated July 20, 1984, the Secretary, Department of Company Affairs, the second appellant held that the company controlled Jansevak and Jansevak was acting on behalf of the company. The provisions of the Act were applicable and the action of the company in starting the undertaking at Lucknow was in breach of the provisions of section 22 thereof. Consequent upon the order, the company was asked to show cause why penal action should not be commenced.
3. The company and as shareholder and director then filed the writ petition herein. Thereby, they sought a declaration that the Act and section 2(r) thereof in particular, were void and had no effect insofar as they related to the printing of news, the publication of newspapers and periodicals, and the establishment of printing presses for the purpose and incidental reliefs. They also sought a writ against the appellants prohibiting them from acting upon the order dated July 20, 1984.
4. The writ petition was heard and disposed of by Pendse, J. He held that sections 21 and 22 of the Act were void and had no effect insofar as they applied to newspapers undertakings. He restrained the appellants from applying the provision of sections 21 and 22 to the company’s newspapers, periodicals and printing presses, and from giving effect to the order dated July 20, 1984. He held, however, that if sections 21 and 22 were found to be constitutional, the order dated July 20, 1984, could not be held to be erroneous or invalid.
5. No challenge has been raised before us on behalf of the company to the learned Single Judge’s finding that the order dated July 20, 1984, is valid if section 22 of the Act is found to be constitutional. The challenge is restricted to the vires of sections 21 and 22 of the Act.
6. The case with which the company came to Court, and which we have to consider is, broadly, this :
(a) sections 21 and 22 of the Act infringe the fundamental right conferred by Article 19(1)(a) and are not protected by Article 19(2);
(b) sections 21 and 22 are not entitled to the protection of Article 31-B because the Constitution (39th Amendment) Act placing the Act in the Ninth Schedule was, insofar as it contained sections 21 and 22, contrary to the basic structure of the Constitution. This was because democracy was a part of the basic structure. Freedom of expression was inherent in the freedom of expression;
(c) sections 21 and 22 are not entitled to the protection of Article 31-C inasmuch as the Act was pre-article 31-C enactment.
7. It is necessary to set out first some of the relevant provisions of the Act and then of the Constitution of India.
8. The statement of objects and reasons of the Act to which Mr. Dhanuka, learned Counsel for the appellants, made reference shows that the Act is intended to regulate the expansion, mergers, amalgamations and the start of new undertakings by undertakings covered by the Act and to exercise control over and prohibit monopolistic and restrictive trade practices which are prejudicial to public interest. The preamble to the Act states that it is meant” to provide that the operation of the economic system does not result in the concentration of economic power to the common detriment for the control of monopolies, for the prohibition of monopolistic and restrictive trade practices and for matters connected therewith or incidental thereto.” Section 2 of the definition section and under sub-clause (g) thereof, interconnected undertakings are defined. Where the undertakings are owned by bodies corporate, inter-connected undertakings exist where, inter alia, one body corporate exercises control over the other body corporate in any manner. Clause (r) of section 2 defines service as “service of any description which is made available to potential users, and includes the provision of facilities in connection with …. Purveying of news or other information…” An undertaking is defined by Clause (v) of section 2 to be “an enterprise which is, or has been or is proposed to be, engaged in… the provision of services, of any kind either directly or through one or more of its units of divisions, whether such unit or division is located at the same place… or at a different place or places.”
9. We are here concerned with the provisions of Chapter III of the Act which deals with “Concentration of Economic Power”. Part A thereof by reason of section 20 within it, applies to an undertaking. If the total value of the assets of such undertaking or of such undertaking and its interconnected undertakings is not less than Rs. 20 crores. The figures of 20 crores has in 1985 been substituted by the figure of Rs. 100 crores. Section 21 deals with the expansion of undertakings. We are not concerned therewith on the present facts; We may only note that its provisions are substantially similar to those of section 22, with which we are directly concerned.
10. Section 22 read thus at the relevant time :
“22 Establishment of new undertaking.—(1) No person or authority, other than Government, shall after the commencement of this Act, establish any new undertaking which, when established would become an inter-connected undertaking of an undertaking (to which this part applies), except under, and in accordance with, the previous permission of the Central Government;
(2) Any person or authority intending to establish a new undertaking referred to in sub-section (1) shall, before taking any action for the establishment of such undertaking, make an application to the Central Government in the prescribed form for that Governments’ approval to the proposal of establishing any undertaking, and shall set out in such application information with regard to the inter-connection. If any, of the new undertaking (which is intended to be established) with every other undertaking, the scheme of finance for the establishment of the new undertaking and such other information as may be prescribed.
(3) (a) The Central Government may call upon the person or authority to satisfy it that the proposal to establish a new undertaking or the scheme of finance with regard to such proposal is not likely to lead to the concentration of economic power to the common detriment or is not likely to be prejudicial to the public interest in any other manner and thereupon, the Central Government may, if it is satisfied that it is expedient in the public interest so to do, by order accord approval to the proposal.
(b) If the Central Government is of opinion that no such approval as is referred to in Clause (a) can be made without further inquiry, it may refer the application to the Commission for an enquiry and the Commission may, after such hearing as it thinks fit, report to the Central Government its opinion thereon.
(c) Upon receipt of the report of the Commission, the Central Government may pass such order with regard to the proposal for the establishment of a new undertaking as it may think fit.
(d) No scheme of finance on the strength of which the establishment of a new undertaking has been approved by the Central Government shall be modified except with previous approval of the Government”.
11. By Act No. 30 of 1984, sub-section (1) of section 22 was substituted and sub-section (1-A) was added thereto. The substituted sub-section (1) and the newly added sub-section (1-A) read thus :
“22 Establishment of new undertaking.—(1) No person or authority other than Government, shall, after the commencement of this Act, establish-
(i) any new undertaking which, when established would become an inter-connected undertaking of an undertaking to which this Part applies; or
(ii) add any new unit or division to an undertaking to which this part applies, except under, and in accordance with the previous permission of the Central Government;
Provided that except where as a result of the establishment of new undertaking, unit or division an undertaking would come into existence to which Clause (b) of section 20 would apply, no permission shall be required, if the new undertaking, or as the case may be, the new unit or division, when established, would not produce the same goods or provide the same services in relation to which the undertaking-
(a) of which such new undertaking would be an interconnected undertaking,
(b) to which such new unit or division is proposed to be added, is a dominant undertaking.
(1-A) No owner of any undertaking to which Clause (a) of section 20 applies, shall establish, except under, and in accordance with the previous permission of the Central Government, any new undertaking for the production, storage, supply, distribution, marketing or control of any article, or for the provision of any service , for which there is no licence capacity, and no such permission shall be granted by that Government unless the articles which are proposed to be produced stored, supplied, distributed, marketed or controlled or, the services which are proposed to be provided, by such new undertaking are different from the articles produced, stored, supplied, distributed, marketed or controlled or as the case may be, services provided by the first mentioned undertaking and the provisions of sub-sections (2) and (3) shall apply to the establishment of such new undertaking as they apply to the establishment of a new undertaking or any new unit or division referred to in sub-section (1).”
12. In Part C of Chapter III, under section 28, are stated the matters to be considered by the Central Government before according any approval under, inter alia, Part A. The Central Government is empowered to take into account all matters which appear in the particular circumstances to be relevant and, among other things, regard is required to be had to the need, consistently with the general economic position of the country, to take into account the factors enumerated. These include the objects of having the trade organised in such a way that its efficiency is progressively increased; of encouraging new enterprises as a counter-vailing force to the concentration of economic power to the common detriment; and regulating the control of the material resources of the community to sub-serve the common good. Under section 29, the Central Government is obliged to give a reasonable opportunity of being heard to any person who is, or may be, in its opinion, interested in the matter under its consideration. Section 30 provides the period within which the Central Government must act. Section 54(1) reads thus :
“54. Power of Central Government to impose conditions, limitations and restrictions on approval, etc. given under the Act.—(1) The Central Government may, while—
(a) according any approval, sanction, permission confirmation or recognition, or
(b) giving any direction or issuing any order, or
(c) granting any exemption,
under this Act, I relation to any matter, impose such conditions, limitations or restrictions as it any think fit”.
13. Under sub-section (2) of section 54, the Central Government has the power to modify a scheme of finance submitted to it in such manner as it thinks fit and under sub-section (3) it any rescind or withdraw its approval or permission, if any condition, limitation or restriction imposed by it is contravened. Section 55 enables any person aggrieved by any decision to appeal to the Supreme Court “on one or more of the grounds specified in section 100 of the Code of Civil Procedure, 1908 (5 of 1908)”. Having regard to the provision of section 100 of the Code, an appeal can lie only if a substantial question of law is involved.
14. Great stress was placed by both sides on the Preamble to the Constitution. We need not reproduce it for most can recite it. Article 13(2) in Part III of the Constitution, which deals with fundamental rights, obliges the Sate not to “make any law which takes away or abridges the rights conferred by this part and any law made in contravention of this clause shall, to the extent of the contravention, be void”. Article 19 is at the heart of the controversy in the appeal. Article 19(1)(a) states that all citizens shall have the “right” of freedom of speech and expression”. Sub-clause (2) of Article 19 states that nothing in Clause 1(a) would affect the operation of any existing law, or prevent the State from making any law which imposed “reasonable restrictions on the exercise of the right conferred by the said sub-clause in the interests of the sovereignty and integrity of India, the security of the State, friendly relations with foreign States, public order, decency or morality or in relation to contempt of Court, defamation or incitement to an offence”. Article 19(1)(g) gives citizens the right ” to practise any profession, or to carry on any occupation, trade or business”. Sub-clause (6) of Article 19 saves existing laws and permits the State to make laws which impose “in the interests of the general public, reasonable restrictions on the exercise of the rights conferred by the said sub-clause ………..”
15. Article 31-B and 31-C must be produced in extenso. They read :
“31-B. Without prejudice to the generality of the provisions contained in Article 31-A, none of the Acts and regulations specified in the Ninth Schedule, nor any of the provisions thereof shall be deemed to be void, or ever to have become void, on the ground that such Act, regulation or provision is inconsistent with, or takes away or abridges any of the rights conferred by any provisions of this Part, and notwithstanding any judgment, decree or order of any Court or Tribunal to the contrary, each of the said Acts and regulations shall, subject to the power of any competent Legislature to repeal or amend it, continue in force.
31-C. Notwithstanding anything contained in Article 13 no law giving effect to the policy of the State towards securing the principles specified in Clause (b) or Clause (c) of Article 39, shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by Article 14 or Article 19 :
Provided that where such law is made by the Legislative of a State, the provisions of this Article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent.”
16. Part IV of the Constitution contains the Directive Principles of State Policy. Article 37 provides that the Directive Principles shall not be enforceable by any Court but shall nevertheless be “fundamental in the governance of the country, and it shall be the duty of the State to apply these principles in making laws”. Article 39(b) and, particularly, (c) are of importance. Thereunder “the State shall, in particular, direct its policy towards securing. (b) that the ownership and control of the material resources of the community are so distributed as best to sub serve the common good; (c) that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment”. Article 368 is the power conferred upon Parliament to amend the Constitution and has received much judicial consideration. The Ninth Schedule to the Constitution, which referred to in Article 31-B contains at Item 91 of the Act. The Act was introduced into the Ninth Schedule by the Constitution (39th Amendment) Act, 1975, with effect from August 10, 1975.
17. At the outset, we note the observations of the Supreme Court in (Indian Express Newspaper (Bombay) Pvt. Ltd. v. Union of India), , Venkataramiah, J., speaking for the Court, said :
“Our Constitution does not use the expression ‘the freedom of the press’ in Article 19: but it is declared by this Court that it is included in Article 19(1)(a) which guarantees freedom of speech and expression”.
This is not in dispute.
18. It is now necessary to consider the judgement of the Supreme Court in cases where allegations of infringement of the freedom of the press were made. The judgements range from the yea 1950 till very recent times.
19. In Romesh Thappar v. State of Madras, Sastri, J., speaking for the majority, said that there could be no doubt that the freedom of speech and expression included the freedom of propagation of ideas and that freedom was ensured by the freedom of circulation. Quoting a US Supreme Court case, the learned Judge said,
“Liberty of circulation is as essential to that freedom as the liberty of publication. Indeed, without circulation, the publication would be of little value”. Noting the constitutional, provisions the learned Judge said that “very narrow and stringent limits have been set to permissible legislative abridgement of the right of free speech and expression, and this was doubtless due to the realisation that the freedom of speech and of the press lay at the foundation of all democratic organisations, for without free political discussion, no public education, so essential for the proper functioning of the processes of popular Government is possible. A freedom of such amptitude might involve risks of abuse. But the framers of the Constitution may well have reflected with Madison …… that
“It is better to leave a few of its noxious branches to their luxuriant growth than, by pruning them away, to injure the vigour of those yielding the proper fruits”.
20. In Brij Bhushan v. State of Delhi, , Fazal Ali, J., echoed the sentiment that the freedom of speech and expression was one of the most valuable rights guaranteed to a citizen by the Constitution and had to be jealously guarded by the courts. Free political discussion was essential for the proper functioning of a democratic Government.
21. The first of the three Indian Express cases we shall be citing in Express Newspapers Pvt Ltd. v. Union of India, . The Working Journalists (Conditions of service) and Miscellaneous Provisions Act, 1956 (45 of 1955), was the subject-matter of the challenge. It was alleged, inter alia, that its provisions violated the fundamental right conferred by Article 19(1)(a) and they did not fall within the four corners of Article 19(2). The Supreme Court noted that the press was not immune from the ordinary forms of taxation, nor from the application of general laws relating to industrial relations. The legislation imposed reasonable restrictions on the fundamental right in the interests of persons employed in newspaper establishments and therefore, fell outside the categories specified in Article 19(2). It was contended that its provisions had the effect of levying a direct and preferential burden on the press and had a tendency to curtail circulation, and thereby narrow the scope of dissemination of information. It was likely to undermine the independence of the press by having to seek Government aid. The Supreme Court held that it could not be said that there was any ulterior motive behind the enactment, because the employers might have to share a great financial burden than before or that the working of the industry might be rendered more difficult than before. These were “incidental disadvantage which may manifest themselves in the future working of the industry. It could not be said that the Legislature in enacting the measure was aiming at these disadvantages when it was trying to ameliorate the conditions of the workmen. Those employers who were favourably situated might not feel the strain at all, while those of them who were marginally situated might not be able to bear the strain and might, in conceivable cases, have to disappear after closing down their establishments. That, however, would be a consequence which would be extraneous and not within the contemplation of he Legislature. It could not be urged that the possible effect of the impact of these measures in conceivable cases would vitiate the legislation as such. The consequences which had been visualized by the employers, viz. the tendency to curtail circulation and thereby narrow the scope of dissemination of information, fettered on their freedom to exercise the right, the likelihood of the independence of the press being undermined by having to seek Government aid, were all “remote and dependent upon various factors which may or may not come into play. Unless these were “the direct or inevitable consequences” of the measures enacted in the impugned stature, it was not possible to strike it down as having that effect and operation.
22. Mr. Dhanuka placed great reliance upon the observation in the first Indian Express case; but, as we shall show, they do not, having regard to the effect of section 22 upon the press, help him.
23. In Sakal Papers (P.) Ltd. v. Union of India, , are observations of great moment to the freedom of the press. The challenge was to the provisions of the Newspapers (Price and Page) Act, 1956 and the Daily Newspapers (Price and Page) Order, 1960. Their effect was to regulate the number of pages, according to the price charged, prescribe the number of supplements to be published and prohibit the publication and sale of newspapers of contravention of any order made under that enactment. The enactment also provided for regulations to be made in regard to the seize and area of advertising matter in relation to other matter. It was abundantly clear to Mudholkar, J., speaking for the Court, from a bare perusal of the enactment and the Order that the right of newspaper to publish news and views and to utilise as many pages as it liked for that purpose was made to depend upon the price charges to the readers. Prior to the promulgation of the order, every newspaper was free to charge price it chose, and thus, had a right unhampered by State regulation to published news and views. This liberty was interfered with by the order which provided for the maximum number of pages for the particular price charged. The question was whether this amounted to an abridgement for the right of a newspaper, to the freedom of expression. It might well be within the power of the State to place, in the interest of the general public, restrictions upon the right of a citizen to carry on business, but it was not open to the State to achieve this object by directly and immediately curtailing any other freedom of that citizen guaranteed by the Constitution and which was not susceptible of abridgement on the grounds set out in Article 19(6). Therefore, the right of freedom of speech could not be taken away with the object of placing restrictions on the business activities of a citizen. Freedom of speech could not, like the freedom to carry on business, be curtailed in the interest of the general public. It followed from this that the State could not make a law which directly restricted one freedom even though it be for securing the better enjoyment of another freedom. Viewed from this angle, it was seen that the reference to the press being a business and to the restriction imposed by the impugned statute being justified as a proper restriction on the right to carry on the business of publishing a newspaper would be wholly irrelevant for considering whether or not it infringed the freedom guaranteed by Article 19(1)(a). The freedom of a newspaper to publish any number of pages or to circulate the newspaper to any number of persons was an integral part of the freedom of speech and expression. A restraint placed upon either of these was a direct infringement of the right of freedom of speech and expression. The enactment was a direct invasion on the right under Article 19(1)(a) and not an incidental or problematic effect thereon as had been found in the first Indian Express case, . The challenge there had failed because the impugned law did not have the effect of directly interfering with the right of the newspaper proprietors granted under Article 19(1)(a). The object of the Newspaper (Price and Page) Act, 1956, was to regulate something which was directly related to the circulation of a newspaper. Since circulation of a newspaper was a part of the right of the freedom of speech, the enactment had to be regarded as one directed against the freedom of speech. It had selected that fact or thing which was an essential and basic attribute of the conception of the freedom of speech, viz., the right to circulate one’s views to all whom one could reach or care to reach, for the imposition of a restriction. It sought to achieve its object of enabling what were termed the smaller newspapers to secure larger circulation by provisions which, without disguise, were aimed at restricting the circulation of what were termed larger papers with better financial strength. The impugned law, far from being one which merely interfered with the right of freedom of speech incidentally, did so directly though it sought to achieve the end by purporting to regulate the business aspect of a newspaper. Such a course was not permissible and the Court must be ever vigilant in “guarding perhaps the most precious of all the freedoms guaranteed by our Constitution. The reason for this is obvious. The freedom of speech and expression of opinion is of paramount importance under a democratic Constitution which envisages changes in the composition of Legislatures and Government and must be preserved. No doubt, the law in question was made upon the recommendation of the press Commission; but since its object is to affect directly the right of circulation of newspapers which would necessarily undermine their power to influence public opinion, it cannot but be regarded as dangerous weapon which is capable of being used against democracy itself”.
It was argued that the object of the enactment was to prevent monopolies and that monopolies were always against public interest and deserved to be suppressed. Even so, upon the view, it had taken that the intendment of the Act and the direct and immediate effect of the enactment and the impugned order was to interfere with the freedom of circulation of newspapers, the circumstance that its object was to suppress monopolies and prevent unfair practices was of no assistance. The legitimacy of the result intended to be achieved did not necessarily imply that every means to achieve it was permissible; for even if the end was desirable and permissible, the means employed must not transgress the limits laid down by the Constitution. If they directly implied on any of the fundamental rights guarantee by the Constitution, it was no answer, when the constitutionality of the measure was challenged that, apart from the fundamental right infringed, the provision was legal. One of the objects of the enactment was, it was urged, to give protection to small or newly-started newspapers and, therefore the enactment was good. Such an object might be desirable; but for attaining it, the State could not make in roads into the right of other newspapers which Article 19(1)(a) guaranteed to them. There might be other ways of helping the small newspapers; and it was for the State to search for them; but the one they had chosen fell foul of the Constitution.
24. The importance of Sakal Papers’ case, , lies in the paramount importance it gives to the freedom of the press; and because it equates the freedom of circulation with the freedom of the press. Any restriction upon circulation is treated as an infringement of the freedom of the press. It also makes clear that however, laudable the object might be, it may not be permitted to be achieved by transgressing the freedom of speech and expression.
25. Another very vital case in regard to the freedom of the press concerned the company itself, Bennett Coleman and Co. Ltd. v. Union of India, . The company had challenged the provisions relating to the import policy for newsprint. They were impeached, inter alia, as constituting an infringement of the right guaranteed under Article 19(1)(a). Reference was made in the course of the judgment to the authorities which we have already discussed. In regard to Sakal’s case, A.I.R. 1926 S.C. 305, the Supreme Court said that it had there been held that “the freedom of speech could not be restricted for the purpose of regulating the commercial aspects of activities of the newspapers”. The freedom of a newspaper to publish any number of papers or to circulate it to any number of persons had been held to be an integral part of the freedom of speech and expression. This freedom was violated by placing restraints upon it or by placing restraints upon something which was an essential part of that freedom. The true test to be applied to the interpretation of legislative measures in relation to the fundamental rights was whether the effect of the impugned action was to take away or abridge the fundamental rights. The acting might have a direct effect on a fundamental right although its subject-matter might be different. The word “direct” went to the quality or character of the effect and not to the subject matter. The object of the law was irrelevant when it established the contention about violation of the fundamental rights. The effect and consequences of the impugned policy was the direct control of the growth and circulation of newspapers. The direct effect was a restriction upon the circulation of newspapers. It was upon the growth of newspapers through pages. It was that newspapers were deprived of their are of advertisement. It was that they were exposed to financial loss. The direct effect, therefore, was that the freedom of speech and expression was infringed. A newspaper, expanded with its news and views. It reached different sections. It has to be left to the newspapers to adjust its newsprint. The Supreme Court commented on the submission of Counsel for the Union of India that “if a certain quantity of steel was allotted, the Government could insist as to how it was going to be used. It was said that the output could be controlled. In our view, newsprint does not stand on the some footing as steel.” “The liberty of press”, it said, “remains on ‘ark of the covenant’ in every democracy. Steel will yield products of steel. Newsprint will manifest what ever is thought of by man. Newspapers give ideas. Newspapers give the people the freedom to find out what ideas are correct. Therefore, the freedom of the press is to be enriched by removing the restrictions on page limit and allowing them to have new editions or new papers ……Newspapers have to be left free to determine their pages, circulation and their new editions.” The newsprint policy abridged the fundamental right of newspapers in regard to the freedom of speech and expression. Newspapers were not allowed their right of circulation. They were not allowed the right of page growth. The common ownership units of newspapers, could not bring out newspapers of new editions. In the garb of distribution of newsprint. Government had controlled the growth and circulation of newspapers. The freedom of the press was both qualitative and quantitatives. It lay, both in circulation and in content. The restrictions imposed by the newsprint policy constricted the newspapers in adjusting their page number and circulation. The press was not exposed to any mischief of monopolistic combination. The newsprint policy was not a measure to combat monopolies. The newsprint policy should allow newspapers that amount of freedom of discussion and information which was needed or would appropriately enable members of society to preserve their political expression to comment not only upon public affairs, but also upon the vast range of views and matters needed for free society.
26. The freedom of the press is termed the “ark of the covenant” which is the concept of immutable commandments-the concept, in fact of basic structure. The judgment reiterates that the freedom of the press is both qualitative and quantitative in that it relates as much to the content of news as to the circulation of newspapers. It castigates the newsprint policy, because it imposed a restriction on the circulation of newspapers and upon new editions thereof. It lays down the test to be applied to a statute, order or executive action which is alleged to infringe a fundamental right. It is this the object of the law is not relevant: what is relevant is whether the laws has a direct effect on the fundamental right. All the more that the test should be applied when it is alleged that a Constitution Amending Act contravenes the basic structure of the Constitution.
27. This brings us to a comparatively recent and, therefore, perhaps the most important judgment on the topic of the freedom of the press. It is the second Indian Express case, Indian Express Newspaper & (Bombay) (P) Ltd. v. Union of India, . The challenge was to the validity of the imposition of import duty on imported newsprint and the levy of auxiliary duty thereon, as modified by notifications issued under section 25 of the Customs Act, 1962. The contention on behalf of the newspaper was that the imposition of the import duty had the direct effect of crippling the freedom of speech and expression as it had led to an increase in the price of newspapers and the inevitable consequence of reduction of their circulation. Venkataramiah, J., speaking for the Court, noted that it was with a view to checking Governmental malpractices which interfered with the free flow of information and democratic Constitutions all over the world had made provisions guaranteeing the freedom of speech and expression laying down the limits of interference with it.
“It is, therefore, ‘the primary duty’, he said ‘of all the national courts to uphold the said freedom and invalidate all laws or administrative actions which interfere with the contrary to the constitutional mandate.”
The power of Government to impose taxes, he said, had to be recognised as it was inherent in the every concept of Government. In India too, there was power to levy tax on persons carrying on the business of publishing newspapers, but he exercise of such power was subject to the scrutiny of courts. The newspaper industry enjoyed two of the fundamental rights, viz. the freedom of speech and expression guaranteed under Article 19(1)(a) and the freedom to engage in any profession, occupation, trade, industry or business guaranteed under Article 19(1)(g), the first because it was concerned with the field of expression and communication and the second because communication had become an occupation or profession, and because there was an invasion of trade, business and industry into that field. While there could be no tax on the right to exercise the freedom of expression, tax was leviable on the trades, business and industry. Hence tax was leviable on the Newspaper Industry. But when such tax transgressed into the field of freedom of expression and stifled that freedom, it became unconstitutional. The delicate task of determining when it crossed from the area of trade, business or industry into the area of freedom of expression and interfered therewith was entrusted to the Court. Taxes had to be levied for the support of Government and newspapers which derived benefit from public expenditure, could not disclaim their liability to contribute a fair and reasonable amount to the public exchequer. What, however, had to be observed in levying a tax on the newspaper industry was that it should not be an overburden on it. “The public interest”, the judgment quoted Lord Simon of Glaisdale in Attorney General v. Times Newspaper Ltd., (1973)3 All.E.R. 54 : (1973)3 W.L.R. 298, “in freedom of discussion (of which the freedom of the press is one aspect) stems from the requirement that members of a democratic society should be sufficiently informed that they may influence intelligently, the decisions which may affect themselves. The freedom of expression, as learned writers had observed, had four broad social purposes to serve :
(i) it helped an individual to attain self-fulfilment,
(ii) it assisted in the discovery of truth,
(iii) it strengthened the capacity of an individual in participating in decision-making, and
(iv) it provided a mechanism by which it would be possible to establish a reasonable balance between stability and social change.
All members of society should be able to form their own beliefs and communicate them freely to others. In sum, the fundamental principle involved was the people’s right to know. Freedom of speech and expression, therefore, was entitled to receive generous support from all those who believed in the participation of people in the administration. It was on account of this special interest which society had in the freedom of speech and expression that the approach of the Government should be more cautious while levying taxes on matters concerning the newspaper industry than while levying taxes on other matters. It was true that the Supreme Court had adopted a liberal approach while dealing with fiscal measures and had upheld different kinds of taxes levied on property, business, trade and industry as they were found to be in public interest. But in the case before it, the Supreme Court was called upon to reconcile the social interest involved in the freedom of speech and expression with the public interest involved if the fiscal levies imposed by the Government specially because newspirit constituted the body, if expression happened to be soul. In view of the intimate connection of newspirit with the freedom of the press, the tests for determining the vires of a statue taxing newsprint had, therefore, to be different from the tests usually adopted for testing the vires of other taxing statutes. In the case of ordinary taxing statutes, the laws might be questioned only if they were either openly confiscatory or a colourable device to confiscate. On the other hand, in case of a tax on newsprint it might be sufficient to show a distinct and noticeable burdensomeness, clearly and directly attributable to the tax. The freedom of the press meant freedom from interference from authority which would have the effect of interference with the content and circulation of newspapers. It was argued on behalf of the Government that the effect of the impugned levy being minimal, there was no need to consider the contentions urged by the newspaper. The Supreme Court quoted Lord Morris of Borth-Y-Gest in Oliver v. Buttigieg, (1967)1 A.C. 115 (P.C.), to say that where the fundamental rights and the freedom of the individuals were being considered, a Court should be cautious before accepting the view that some particular disregard of them was a minimal account. The learned Lord had observed that there was always the likelihood of the violation being vastly widened and extended with impunity. He had also quoted the words of Portia (at page 136).
“It will be recorded for precedent and many an error by the same example will rush into the State.”
The Court was not able to come to the conclusion that the effect of the levy was indeed so burdensome as to affect the freedom of the press. The Court was also not able to come to the conclusion that it would not be burdensome. The Court, therefore, directed the Central Government to reconsider it in the light of what had been said by it.
28. Once again, the importance of the press was highlighted. It was called “the very soul of democracy”. It was said that the freedom of the press meant freedom for interference with the content and circulation. So important a right was this that it was “the primary duty of all the National courts to uphold the said freedom and invalidate all laws or administrative actions which interfered with it, contrary to the constitutional mandate”. Acceptance of the argument that the effect would be minimal, was cautioned against.
29. This brings us to the last of the cases where interference with the freedom of the press was alleged before the Supreme Court. This again was a case concerning the Indian Express (the third Indian Express case) Express Newspapers Pvt. Ltd. v. Union of India, . The newspaper challenged the constitutional validity of a notice of re-entry upon forfeiture of lease in regard to premises whereon the newspaper business was conducted. The averments was that the action was intended to compel the newspaper to close down and it was in violation of the fundamental rights guaranteed by Article 19(1)(a). The writ petitions were allowed.
30. We must now turn to the judgment of the Supreme Court in Waman Rao v. Union of India, , which is of particular relevance to the contention if regard to Article 31-B. A ceiling on agricultural holdings was imposed by the Maharashtra Agricultural Lands (Ceiling on Holdings) Act, (27 of 1961) which was brought into operation on January 26, 1962. This Court had held that the provisions of this enactment and certain amendments thereto were not open to challenge on the ground that they were inconsistent with or took away or abridged any of the rights conferred by Part III of the Constitution since these enactments has been placed in the Ninth Schedule by the Constitution 17th and 40th Amendment Acts. In the proceedings before the Supreme Court, the main challenge was to the constitutionality of Articles 31-A, 31-B and unamended Articles 31-C. Chandrachud, J., speaking for the majority, noted the judgment in Kesavananda Bharati, , where it had been held that in exercise of the power conferred by Article 368. The Constitution could not be amended so as to damage or destroy the basic structure of the Constitution. He observed that every case in which the protection of a fundamental right was withdrawn, would not necessarily result in damaging or destroying the basic structure of the Constitution. The question as to whether the basic structure was damaged or destroyed in any given case would depend upon which particular Article of Part III was in issue and whether what was withdrawn was quintessential to the basic structure of the Constitution. The Constitution First and Fourth Amending Acts which introduced Articles 31-A and 31-B into the Constitution with retrospective effect for the extinguishment or modification of rights in lands held or let for purposes of agriculture, or for purposes ancillary thereto, strengthened rather than weakened the basic structure of the Constitution. It might happen that while existing inequalities were being removed, new inequalities might arise marginally and incidentally. Such marginal and incidental inequalities could not damage or destroy the basic structure of the Constitution . Insofar as Article 31-B was concerned, it did not define the category of laws which were to receive its protection, and it afforded protection to the Schedule-laws against at the provisions of Part III of the Constitution. No enactment would be placed in the Ninth Schedule except by Parliament; and since it was a part of the Constitution, no additions or alterations could be made therein without complying with the restrictive provisions governing amendments to the Constitution. Article 31-B read with the Ninth Schedule provided a protective umbrella to all enactments included in that schedule, no matter of what character, kind or category they might be Article 31-B empowered Parliament to include in the Ninth Schedule such laws as it considered fit and proper to include therein. The 39th amendment had undertaken “an incredibly massive programme” to include Items 87 to 124 while the 40th amendment had added Items 125 to 188 to the Ninth Schedule “in one stroke”. The Supreme Court drew a line, treating the decision in Kesavananda Bharati , as the landmark. Several enactments were put in the Ninth Schedule prior to that decision on the supposition that the power of Parliament to amend the Constitution was wide and untrammelled. The theory the Parliament could not exercise its amending power so as to damage or destroy the basic structure of the Constitution was propounded and accepted for the first time in Kesavananda Bharti case, . This was one reason for upholding the laws incorporated in the Ninth Schedule before April 24,1973, on which date, the judgment in Kesavananda Bharti, , was rendered. These laws and regulations would not be open to challenge on the ground that they were inconsistent with or took away or abridged any of the rights conferred by any of the provision of Part III of the Constitution. Enactments and regulations which were or would be included in the Ninth Schedule on or after April 24, 1973 would not receive the protection of Article 31-B for the plain reason that in the face of the judgment in Kesavananda Bharti, , there was no justification for making additions to the Ninth Schedule with a view to conferring a blanket protection on the laws included therein. The various Constitutional amendments by which additions were made to the Ninth Schedule on or after April 24, 1973, would be valid, only if they did not damage to destroy the basic structure of the Constitution. Referring to the unamended portion of Article 31-C, it was observed that it was not “like an uncharted sea.” It gave protection to a defined and limited category of laws which were passed for giving effect to the policy of the State towards securing the principles specified in Clause (b) or Clause (c) of Article 39. These clauses of Article 39 contained Directive Principles which were vital to the well-being of the country and welfare of its people. Chandrachud, J., said, “It is impossible to conceive that any law passed for such a purpose, can at all violate Article 14 or Article 19……..Infact, far from damaging the basic structure of the Constitution, laws passed truly and bona fide for giving effect to directive principles contained in Clauses (b) and (c) of Article 39 will fortify that structure”. Laws included in the Ninth Schedule on or after April 24, 1973 would not receive the protection of Article 31-B ipso facto. Those laws would have to be examined individually for determining whether the constitutional amendments by which they were put in the Ninth Schedule damaged or destroyed the basic structure of the Constitution in any manner. Such an exercise would, however, “become otiose”, if they fell within the scope and purview of Article 31-A or the unamended Article 31-C. If those laws were saved by these articles, it would be unnecessary to determine whether they also received the protection of Article 31-B read with the Ninth Schedule. The fact that Article 31-B conferred protection on the Schedule-laws against any provisions of Part III and the other two articles conferred protection as against Articles 14 and 19 only, would make no real difference since, after the deletion of Article 31, the only provisions of Part III which would generally come into play on the question of validity of laws were Articles 14 and 19.
31. The Act was introduced into the Ninth Schedule after April 24, 1973. The Constitution Amendment Act by which it was so introduced must be tested to determine whether it is destructive of or damaging to the Constitution’s basic structure. If it is found to be so, the Act does not enjoy the protection of Article 31-B.
32. Mr. Dhanuka, we must note, stressed the observation of Chandrachud, J., that it was impossible to conceive that a law passed to further the principles of Articles 39(b) and (c) could offend the basic structure of the Constitution.
33. The next judgment that must be considered is Maharao Sahib Shri Bhim Singhji v. Union of India, . The Urban Land (Ceiling and Regulation) Act, 1976 was challenged on the ground that it did not further the Directive Principles of State Policy contained in Clauses (b) and (c) of Article 39 of the Constitution. Tulzapurkar, J., alone took the view that the petitioners’ contention was correct. Chandrachud, C.J., and Bhagwati, J., held the Ceiling Act to be valid except only in regard to section 27. They so stated in a brief order and observed that fuller reasons would follow. It appears however, from the judgment, in paragraph 4 of the judgment in Maharao Sahib Shri Bhim Singhji v. Union of India, , that Chandrachud, C.J., and Bhagwati, J., then concurred with the judgment delivered by Krishna Iyer, J., and felt that the need for fuller reasons was obviated. Krishna Iyer, J., in the course of his judgment, noted that :
“the question of basic structure being breached, could not arise when the vires of an ordinary legislation were being examined as distinguished from the vires of a constitutional amendment. Every breach of equality did not spell disaster as a lethal violation of the basic structure. What was betrayal of the basic feature was not a mere violation of Article 14; but a shocking, unconscionable or unscrupulous travesty of the quintessence of equal justice. If a legislation does go that far, it shakes, the democratic foundation and must suffer that death penalty.”
Without amplifying, Krishna Iyer, J., however, struck down the provisions of section 27 of the Ceiling Act. A.P. Sen, J., also struck down section 27 of the Ceiling Act and he did so because there was no justification for freezing of transactions by way of sale, mortgage or lease of vacant land for the stated period even though it fell within the ceiling limits. He held that the right to acquire, hold and dispose of property guaranteed to a citizen under Article 19(1)(f) carried with it the right not to hold any property.
34. The judgement in Bhim Singhji, , was relied upon by Mr. Dhanuka because of the observations of Krishna Iyer, J., quoted above. It has been relied upon by Dr. L.M. Singhvi, learned Counsel for the respondents, because A.P. Sen, J., struck down section 27 having regard to the provisions of Article 19(1)(f).
35. The judgment in Maneka Gandhi v. Union of India, , must now be examined in regard to the test to be applied, it was held, following the judgment in (Rustom Cavasjee Coopers case), that what was relevant was the direct and inevitable consequence of the impugned State action on the fundamental right of the petitioner. Otherwise, the protection of the fundamental rights would be subtly but surely eroded. Directness was linked to inevitability. If the effect of State action on a fundamental right was direct and inevitable then a fortiori, it had to be presumed to have been intended by the authority taking the action and, hence, the doctrine of direct and inevitable effect had been described by some jurists as the doctrine of intended and real effect. Bhagwati, J., speaking for himself Untwalia and Murtaza fazal Ali, JJ., observed that it was not their view that a right which was not specifically mentioned by name could never be a fundamental right with in the meaning of Article 19(1). It was possible that a right did not find express mention in any clause of Article 19(1), and yet it might be covered by some other clause of that article. Bhagwati, J., took, for example and by way of illustration, the freedom of the press and his observation in this behalf are of great importance. The freedom of the press, he said, was “the most cherished and valued freedom in democracy indeed democracy cannot survive without a free press, Democracy is based essentially on free debate and open discussion, for that is the only corrective of governmental action in a democratic set up. If democracy means Government of the people, by the people, it is obvious that every citizen must be entitled to participate in a democratic process and in order to enable him to intelligently exercise his right of making a choice, free and general discussion of public matter in absolutely essential. Manifestly, free debate and open discussion in the most comprehensive sense, is not possible unless there is a free and independent press. Indeed, the true measure of the health and vigour of a democracy is always to be found in its press. Look at its newspaper—do they reflect diversity of opinions and views, do they contain expression of dissent and criticism against governmental policies and actions, or do they obsequiously sing the praise of the Government or lionize or deify the ruler?. The newspapers are an index of the true character of the Government—Whether it is democratic or authoritarian. It was Mr. Justice Potter Stewart who said:
“Without an informed and free press, there cannot be an enlightened people.” Thus the freedom of the press constitutes one of the pillars of democracy and indeed lies at the foundation of democratic organisation.
The learned Judge also observed that the freedom of circulation was necessarily involved in the freedom of speech and expression and was part of it and hence enjoyed the protection of Article 19(1)(a).
36. Maneka’s Gandhi’s case, , is relevant for our purposes, firstly, because it lays down the test to be applied to State action when the allegation is that it offends a fundamental right. The same test must necessarily be applied when the allegation is that a Constitutional Amendment Act damages or impairs the basic structure of the Constitution. Further, Bhagawati, J., speaking for himself and two other learned judges, in clearest terms, emphasised above, highlighted the importance of the freedom of the press.
37. There are two cases which involve the Minerva Mills Ltd. and the first is of great importance in Constitutional law. It is Minerva Mills Ltd. v. Union of India, . The challenge there was to amendments made by a Constitutional Amendment Act to Article 368 of the Constitution by the introduction of the Clauses 4 and 5 and to the amendment of Article 31-C whereby it was stated that no law giving effect to the policy of the State towards securing all or any of the principles laid down in Part IV of the Constitution could be deemed to be void on the ground that it was inconsistent with, or took away or abridged any of the rights conferred by Articles 14, 19 or Article 31. It was made clear that there was no challenge to the unamended Article 31-C. The main controversy, it was noted, centred round the question whether the Directive Principles of the State policy contained in Part IV could have primacy over the fundamental rights conferred by Part III and the question was whether, in view of the majority decision in Kesavananda Bharati, , it was permissible to Parliament to so amend the Constitution as to give a position of precedence to the directive principles over the fundamental rights. It was observed :
“To destroy the guarantees given by Part III in order purportedly to achieved the goals of Part IV is plainly to subvert the Constitution by destroying its basic structure.”
38. On a reasonable interpretation of the amendment to Article 31-C Articles 14 and 19 stood abrogated in regard to the category of laws described in Article 31-C. The starting consequence was that even if a law was in total defiance of the mandate of Articles 13 read with Articles 14 and 19, its validity would not be open to question so long as its object was to secure a Directive Principle of State Policy. A large majority of laws could be justified as having been passed for the purpose of giving effect to the policy of the State towards securing a principle laid down in part IV. In respect of all such laws, which would cover an extensive field , the protection of Articles 14 and 19 would stand wholly withdrawn. It was no answer to say, while determining whether the basic structure of the Constitution was altered, that at least some laws could fall outside the scope of Article 31-C. Articles 14 and 19 did not confer any fanciful rights they conferred rights which were elementary for the proper and effective functioning of a democracy. The principles enunciated in Part IV were not the proclaimed monopoly of democracies alone. They were common to all politics, democratic or authoritarian. Every State was goal-oriented and claimed to strive for securing the welfare of its people. The distinction between the different forms of Government consisted in that a real democracy endeavoured to achieve its objectives through the discipline of fundamental freedoms like those conferred by Articles 14 and 19. Those were the most elementary freedoms without which a free democracy was impossible; and which must, therefore, be preserved at all costs. It was the majority view that the amendments were not valid.
39. In the second (Minerva Mill a case), A.I.R. 1986 S.C. 5030, the challenge to the provisions of an order passed under the Industries (Development and Regulation) Act, 1951 taking over the management of the mills and the constitutional validity of the Sick Textile Undertakings (Nationalisation) Act, 1974. The two judges of the Supreme Court who heard the matter observed that constitutional amendments made after April 24, 1973, by which Acts, or Regulations were included in the Ninth Schedule, could be challenged on the ground that they damaged the basic or essential features of the Constitution or its basic structure. But, they said, if any of such Acts and Regulations was saved by Article 31-A or Article 31-C, such challenge on the ground that the constitutional amendment damaged or destroyed a basic or essential feature of the Constitution or its basic structure as reflected in Article 14 or Article 19 became otiose. The Nationalisation Act fell within the protective umbrella of Article 31-C; and it could not be challenged on the ground that it violated the provisions of Articles 14 and 19. The Court therefore said that it was not called upon to adjudicate upon the contention that some of the provisions of the Nationalisation Act were violative of Articles 14 and 19 of the Constitution.
40. The relevance of these judgment to the controversy before us in regard to Article 31-B arises because Mr. Dhanuka submitted that since section 22 of the Act fell within the scope of Article 31-C, it could never be said that the Constitution Amendment Act was introduced into the Ninth Scheduled damaged the basic structure of the Constitution. Mr. Dhanuka also pointed out that Article 31-C in its unamended form was not the subject matter of the challenge in the first Minerva Mills case, , so that the reference therein to the directive principles was to all the Directive Principles other than those mentioned in Article 39(b) and (c), which were mentioned by Article 31-C in its unamended form. His conclusion was that these two Directive Principles enjoyed primacy over the fundamental rights set out in Part III.
41. We now refer to parts of the judgment in the case of Kesavananda Bharati, , to show that some of the learned Judges there expressed the view that the freedom of expression was an element of the basic structure of the Constitution. Shelat and Gover, JJ., referred to the dignity of the individual secured by the various freedoms and basic rights in Part III of the Constitution. Hedge and Mukherjee, JJ., said that Parliament had no power to abrogate or emasculate the basic elements or fundamental features of the Constitution, including the essential features of the individual freedoms secured to the citizens. They were unable to agree with the contention that in order to build a welfare State, it was necessary to destroy some of the human freedoms. That was not the perspective of the Constitution. The Constitution envisaged that the State should, without delay, make available to all the citizens of the country, the real benefits of those freedoms in a democratic way. Human freedoms were lost gradually and imperceptibly, and their destruction was generally followed by authoritarian rule. That was what history had taught us. The struggle between liberty and power was eternal. Vigilance was the price that, we, like every other democratic society, had to pay to safeguard the democratic values enshrined in our Constitution. Even the best of Governments were not avers to have more and more power to carry out their plans and programmers which they might sincerely believe to be in public interest. But a freedom once lost was hardly ever regained except by revolution. Every encroachment on freedom sets a pattern for further encroachments. Our constitutional plan was to eradicate poverty without destruction of individual freedoms. A.N. Roy, J., also took the view that the fundamental rights contained in Part III of the Constitution were a part of the basic structure thereof.
42. There is no exhaustive list of the elements that constitute the basic structure of a Constitution and which, therefore, are unamendable. The judgments of the Supreme Court to which we have made reference have evaluated the fundamental right of the freedom of the press in terms which leave no doubt that it is an inherent part of the basic constitutional structure and indispensable to the democratic form of Government that it provides. The judgment in Kesavananada Bharti, , mentioned above, makes this still clearer. Accordingly, we hold that the freedom of the press is a part of the basic structure of the Constitution.
43. This brings us to consider the effect of section 22 of the Act. We have already quoted it. Clause (1), places, in the first instance, an embargo upon any person or authority other than Government establishing any new undertaking which would become an inter-connected undertaking of an undertaking to which, by reason of section 20, Part A of Chapter III applies. Part A applies to, inter alia, an undertaking whose own assets or whose own assets together with the assets of inter-connected undertakings were not less than Rs. 20 crores. Part A therefore, applies to the company. Under the provisions of sub-section (1) of section 22, such new undertaking can be established only under and in accordance with the previous permission of the Central Government. The application in this behalf is, by reason of the sub-section (1), to be made in the prescribed form and information in regard to the interconnection of the new undertaking with every other undertaking and the scheme of finance for the establishment of the new undertaking are required to be set out, as also such other information as may be prescribed. By virtue of Clause (a) of sub-section (3), the Central Government call upon the applicant for permission to satisfy it that the proposal to establish the new undertaking or the scheme of finance with regard to such proposal is not likely to lead to the concentration of economic power to the common detriment or is not likely to be prejudicial to the public interest in any other manner. Thereafter the Central Government may, if it is satisfied that it is expedient in the public interest so to do, accord approval. If the Central Government is of the opinion that no approval can be given without further enquiry, it may refer the matter to the Commission established under the Act for enquiry. The Commission is obliged to report the result of the enquiry to Central Government, and the Central Government must pass an order thereon. The scheme of finance on the strength of which approval has been obtained may not be modified except with the previous approval of the Central Government.
44. Sub-section (1) of section 22 was substituted and sub-section (1) added thereto by Act 30 of 1984. The amended sub-section (1) need not detain us, but the effect of sub-section (1-A) is of relevance. An undertaking to which part A applies cannot, by reason thereof, obtain permission from the Central Government in respect of any article which it already produces, stores, supplies, distributes, markets or controls or in respect of any service of the nature that it already provides.
45. Applying section 22 to the present facts, the company cannot through Jansevak, publish any newspaper in Lucknow until it has secured the Central Government’s permission. Such permission would be given, if the Central Government was satisfied, having regard only to economic considerations, that it was expedient in the public interest to do so. Needless to say, what applies to Jansevak and Lucknow applies equally to any other undertaking or part of the country. Under the provisions of sub-section (1-A) of section 22, the company can, of course never secure such permission.
46. The provisions of the unamended section 22, which are sought to be applied to the company, as they read, constitute a prior restraint on circulation and are in breach of the freedom of the press.
47. Mr. Dhanku submitted that the Act was passed to further the object of Article 39(c) of the Constitution. He referred in this behalf to the Preamble and the scheme of the Act. Section 22, he submitted, applied to all industries, and not only to the press. It applies to the press because the press provided a service under the terms of section 2(r). All undertakings to which Part A of Chapter III applied, had to comply with the requirements of section 22. The Act was a general regularly measure to control exclusivity or monopolies in business. It might incidentally affect an undertaking that owned a newspaper; but it was not aimed at the press. It had no direct or proximate effect on the press.
48. Section 22, as it stood, precluded what we may call a monopoly press undertaking like the company from setting up a new newspaper undertaking, unless it had obtained previous permission. The previous permission had to be obtained from the Central Government of the day. The application for permission was to be considered by the Government on criteria which were irrelevant to the freedom of the press though relevant to the object of the Act. In granting permission, Government could impose conditions whose nature was not specified. As it now reads, a monopoly press and undertaking just cannot set up a new newspaper undertaking. Section 22, as it read, and reads, therefore, imposes a prior restraint on the circulation of newspapers. It has a direct, proximate and certain adverse effect, not an incidental, probable effect on the freedom of the press. Laudable though the object of section 22 is in economic terms, it is sought to be achieved by impermissible means, so far as monopoly press undertakings are concerned of transgressing the freedom of the press which is both a fundamental right and an element of the basic structure of the Constitution.
49. Mr. Dhanku submitted that, at worst, there was a minor abridgement of the freedom of the press and no destruction or damage to the Constitution’s basic structure. There was no “shocking, unconscionable or unscrupulous travesty of the quintessence” of a fundamental right.
50. It is difficult to hold that the freedom of the press is merely abridged by section 22 and that there is no damage or impairment to the basic structure of the Constitution. As has been repeatedly pointed out by the Supreme Court, freedom of circulation is as much a part of the freedom of the press as the freedom to propagate news and views. Section 22 imposes a restraint on circulation. As has also been pointed out by the Supreme Court, the freedom of the press is as much the freedom of the citizen to read the journal of his choice. From the point of view, as much of the publisher as of the citizen, it is irrelevant to the concept of the freedom of the press that the publisher is a monopoly undertaking. In the wider interests of the effective functioning of our democracy, the citizen has a right to inform himself of news and views and the right cannot be denied to him on considerations extraneous thereto. The concept of the freedom of the press necessarily means that a journal’s circulation should be free to grow to meet the demand for it. Interference with the circulation of the journal is, therefore, interference with the quintessence of the freedom of the press, and it damages the basic structure of the Constitution.
51. There is another factor to which Dr. Singhvi adverted, and rightly, in the context of the extent of the effect of section 22. The monetary limit thereunder can ride or fall depending upon the outlook of the party in power. It has presently been raised from Rs. 20 crores to Rs. 100 crores; but it could be brought down tomorrow to a smaller figure. Were this to happen, more undertakings, including the press undertakings, could become monopoly undertakings to which the provisions of section 22 would become applicable. Its constitutionality cannot, therefore, be judged on the basis that, as things stand today, it will operate only in regard to one monopoly press undertaking.
52. It was submitted by Mr. Dhanuka that section 22 was merely regulatory. It is regulatory of the business of the press. Such regulation however, cannot transgress the freedom of the press.
53. It was pointed out by Mr. Dhanuka that the Act was intended to further the Directive Principles that the operation of the economic system should not result in the concentration of wealth and means of production to the common detriment [Article 39(c)]. This is not a proposition which can be disputed. Mr. Dhanuka submitted that this Directive Principles is a part of the Constitution’s basic structure and that, assuming the freedom of the press also to be a part of the basic structure, there should be a balancing of the conflicting interest. There can be no doubt that distributory justice is one main plank of the Constitution and a most desirable thing; but so is the right of the citizen to inform himself of news and views in a manner of his own choice so that he may best exercise his franchise. There can, therefore, be no balancing or sacrifice of the one for the other. In so holding, we echo the sentiments of the Supreme Court in the judgements we have cited.
54. Mr. Dhanuka stresses the observation in the judgment in Waman Rao’s case, , that it was impossible to conceive that any law passed for the purpose of giving effect to Clause (c) of Article 39 could violate Articles 14 or 19 and that, far from damaging the basic structure of the Constitution, laws truly and bona fide passed for giving effect to these Directive Principles would fortify that structure. The observations with respect, are not a conclusion in regard to anything upon which the Court was ruling. They are, in that sense, not obiter dicta. They really are reflections about enactments of the future. The observations are not meant to preclude the courts from holding, in an appropriate case, that a law passed to give effect to the Directive Principles in Clauses (b) and (c) of Article 39 or any provision thereof, impairs the basic structure of the Constitution. We have no doubt that the Act truly and bona fide been enacted to achieve the objectives of Article 39(c) and that, as a whole, it fortifies the basic structure of the Constitution; but that does not mean that we must overlook the fact that section 22 therein as applicable to be a monopoly undertaking offends the freedom of the press, which is also a part of the basic structure. It is not possible on the basis of these observations to throw out the challenge to the Constitution Amendment Act that introduced the Act into the Ninth Schedule.
55. Mr. Govilkar, learned Counsel for the All India Newspapers’ Association (which had intervened before the learned Single Judge and which is the third respondent to this appeal), argued that small newspapers needed protection against larger newspapers and monopoly press undertakings. We will assume, to use the Supreme Court’s phrase, that monopolies are always obnoxious and that small newspapers require protection; but the objectives of controlling monopolies and protecting small newspapers must be reached by means that do not trample upon the essential constitutional freedoms. Given the role that it must play in a democratic society, the press must sometimes be in a position to stand up to the Government of the day to be able to give to the electorate news of the Government’s functioning and informed views thereabout. Realistically speaking, it must be recognised that small and, therefore, financially weak newspapers would not be in a position to offend the Government of the day for long and the more upright among them might be forced to close down. The larger and financially stabler newspapers must be recognised as having an important part to play.
56. The impatience to achieve social and distributory justice is very understandable; but Governments are composed of mortal men who do not last forever, and they cannot vouchsafe the good intentions of those who will succeed them. The security of the citizens of this land, therefore, lies in what the framers of the Constitution held to be immutable. They held an elected form of Government to be immutable. An elected form of Government requires an informed electorate, the electorate secures the bulk of relevant information from the press. The freer the press, the greater the likelihood of a democracy in the true sense of the word, a Government of the people.
57. In conclusion, up on this aspect, we hold that the Constitution (39th Amendment) Act which introduced the Act into the Ninth Schedule is bad to the extent that it brought the provision of section 22 of the Act to bear upon press undertaking; because in doing so, it impinged upon the freedom of the press and, consequently, impaired the basic structure of the Constitution. The protection of Article 31-B is, not available to section 22 of the Act.
58. We shall consider whether the protection of Article 31-C is available to section 2 of the Act. The Act is of 1969. Article 31-C was inserted by the Constitution (25th Amendment) Act with effect from April 20, 1972. The Act is, therefore, a pre-Article 31-C enactment.
59. The Supreme Court was concerned with Article 31-C in Excel Wear v. Union of India, . It held that enactments, though placed on the statute book for the purposes of achieving the principles specified in Clause (b) or (c) of Article 39, were not entitled to the protection given by Article 31-C unless they had been enacted after Article 31-C was introduced into the Constitution. The Legislature, is was reasoned, could not have thought of enacting a law within the meaning of Article 31-C at a time when it had not been so introduced. A law which was bad at the time when it has enacted would not be saved, because Article 31-C had thereafter been brought on the statute book. Article 31-C only applied to law for the aforementioned purposes enacted subsequent to the placing of Article 31C in the Constitution. Applying the judgment in Excel Wear’s case. , it must be held that the protection of Article 31-C is not available to the Act which is a pre-Article 3-C enactment.
60. Mr. Dhanuka drew our attention to the judgment of a Division Bench of this Court to which one of us (Sugla, J.) was a party, Rahuri Sahakari Sakhar Karkhana Ltd. v. State of Maharashtra, . The challenge was directed to an order called the Maharashtra Sugar Factories (Reservation of Areas and Regulation of Crushing and Sugarcane Supply) Order, 1984, on the ground that it violated the petitioner’s fundamental rights under Articles 14 and 19 of Constitution. The respondent contended that the order was covered by the provisions of Article 39(b) of the Constitution and therefore, enjoyed the protective umbrella of Article 31-C. Counsel for the petitioners submitted that Article 31-C was not retrospective in nature, and , therefore, the Essential Commodities Act under which the order had been issued was not covered by Article 31(c). The Division Bench came to the conclusion that the order Article 39(b) and since it had been issued post-Article 31-C, was covered by the protective umbrella of Article 31-C . Having regard to an observation in Waman Rao’s case, . The Division Bench held that the word “deemed” used in Article 31-C indicated that it covered both past and future enactments.
61. It will be seen that the controversy before the Division Bench was in relation to the order which was post-Article 31-C. Being issued in furtherance of the objectives of Article 39(b), it enjoyed the protection of Article 31-C. It any event, the judgment of the Supreme Court in Excel wear’s case, , which held that Article 31-C, was only prospective, was not cited before the Division Bench.
62. Mr. Dhanuka pointed out that sub-section 22 had been amended post-Article 31-C and in his submission, those amended portions, being enacted for achieving the objective of Article 39(b), were entitled to the protection of Article 31-C. In the first place, we are not directly concerned with those amendments, because they were affected after the first editions of “The Times of India” and “Nav Bharat Times” had been issued in Lucknow and notices in this regard had been served upon the Company. In the second place, the amendments cannot stand as of themselves and must necessarily be read with unamended proportions of section 22. It is, therefore, not possible to uphold this submission.
63. The writ petition impugned all the provisions of the Act. Before the learned Single Judge, the challenge was restricted to sections 21 and 22 thereof and he upheld that challenge. We find that it is only section 22 which is applicable to the facts of this case. Since we are considering the issue of constitutional validity, we consider it appropriate to confine the relief we give to section 22.
64. We have held that the freedom of the press is a fundamental right, guaranteed by Article 19(1)(a), that it is also part of the basic structure of the Constitution, that section 22 damages or impairs the basic structure of the Constitution in that it impinges on the freedom of the press, that section 22 does not, enjoy the protective umbrella of Article 31-C.
65. In the circumstances and in order to preserve the constitutionality of section 22 so far as we may, we must read down section 22 so that it will not be applicable when undertakings covered by Part-A of Chapter III of the Act propose to establish new inter-connected undertakings to print and/or publish newspapers or similar journals. The appeal is dismissed.
66. There shall be no order as to costs.
67. An oral application is made for a certificate for appeal to the Supreme Court. A substantial question of law relating to the interpretation of the Constitution is here raised. The question is indicated in the order. A certificate of fitness to appeal to the Supreme Court shall issue.
68. On the application of Counsel for the appellants, the interim order passed in the appeal on July 25, 1986, shall continue for a period of eight weeks from today.