On October 30, 2018, the Supreme Court allowed Appeal filed in Sushila N. Rungta v. The Tax Recovery Officer, holding that a repeal simpliciter will not attract Section 6 of the General Clauses Act if the Statement of Objections of the Repeal Act clearly states a contrary intention.
Sushila N. Rungta’s (“the Appellant”) grandfather challenged a show cause notice issued to him on June 1, 1971 which directed confiscation of items of gold and imposed a penalty on the Appellant’s grandfather under the Gold (Control) Act, 1968 (“the Act”), before the High Court of Delhi. The Appellant’s grandfather, thereafter, filed an Appeal challenging Order of the High Court before the Supreme Court. The Supreme Court, on August 9, 1973, passed an Interim Order staying all further proceedings relating to the impugned show cause notice until final disposal of the Appeal.
When the Interim Order was in force, the Act was repealed. The repealed Act did not, however, contain a savings clause. The Statement and Objections of the Repeal Act states as follows:
2. Over the past 22 (twenty two) years, the results achieved under the Act have not been encouraging and the desired objectives for which the Act was introduced have not been achieved due to various socio-economic and cultural factors in the vast multitude of the country’s population and the lack of administrative machinery. On the other hand, this regressive and purely regulatory Act has given rise to considerable dissatisfaction in the minds of the public as it has caused hardship and harassment to the artisans and small self-employed goldsmiths who have not been able to develop their skills and earn proper living on account of the rigours which this Act imposed upon them.
3. Taking these factors into consideration and the advice of experts who have examined issued related to this Act, it is proposed to repeal the Gold (Control) Act, 1968…”
The Appeal, thereafter, came up for hearing before the Supreme Court on October 30, 2018. The counsel for the Appellant submitted that the Act has been repealed without a savings clause and that Section 6 of the General Clauses Act would not apply for the reason that the objects and reasons show that the Act was sought to be repealed without any savings and , in fact, the Act has been stated to be regressive and to have brought dissatisfaction to the public. the Statement of Objects and Reasons clearly evinced the intention that nothing will survive the repeal of the Act. Consequently, the impugned Show Cause Notice cannot survive the repeal of the Act
The counsel for the Respondent submitted that that the general rule under Section 6 of the General Clauses Act would apply and the proceedings against the Appellant would be saved.
Section 6 of the General Clauses Act provides as follows:
“Effect of repeal: Where this Act, or any Central Act or Regulation made after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made, then, unless a different intention appears, the repeal shall not:
a) revive anything not in force or existing at the time at which the repeal takes effect; or
b) affect the previous operation of any enactment so repealed or anything duly done or suffered thereunder; or
c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or
d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any enactment so repealed; or
e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or Regulation had not been passed.”
The Supreme Court allowed the Appeal, and held “…that the repeal simpliciter, in the present case, does not attract the provisions of Section 6 of the General Clauses Act as the contrary intention is very clearly expressed in the statement of objects and reasons to the 1990 repeal Act...”
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