Chiranjit Lal Chaudhary vs Union of India - Leading Case on Right to Equality & Reasonable Classification

Chiranjit Lal Chowudhury vs Union of India -  Leading Case on Right to Equality & Reasonable Classification

Chiranjit Lal Chaudhary v. Union of India, Case Citation: AIR 1951 SC 41

In this case due to mismanagement in Sholapur Spinning and Weaving Company Limited the management threatened to shut down the mill. At that time, Government of India passed the legislation named Sholapur Spinning  and Weaving Co. (Emergency Provision) Act, 1950, empowering the government of India to take over the control and management of the company and its properties by appointing their own directors. This act was challenged by the shareholder of the company, Chiranjit Singh Chaudhary, on the ground that a single company and its shareholder was being denied equality before the law, because the Act treated him differently vis a vis other companies and their shareholders in India. It was pointed out that the law in the case had selected one particular company and its shareholders and had taken away from them the right to manage their own affairs but the same treatment had not been meted out to all other companies or shareholders in the same manner.

Main issue before the Supreme Court in Chiranjit Lal Chaudhary Case was that whether a legislation would be valid if it applied to one person or one class of person. So it was one such case where issue of reasonable classification under article 14 of Indian Constitution was considered by the Apex court.

In Chiranjeet Lal Chowdhury Case Supreme Court held the Sholapur Spinning  and Weaving Co. (Emergency Provision) Act, 1950 as valid legislation. It said that a law may be constitutional even though it applies to a single individual if, on account of some special circumstances or reasons applicable to him and not applicable to others, that single individual may be treated as a class itself, unless it is shown that there are others who are similarly circumstanced. The presumption is always in the favour of the enactment and the burden is on the petitioner who attacks the validity of the legislation to place all materials before the Court which would show that the selection is arbitrary and unreasonable. The Legislature is free to recognize the degree of harm and it may confine its restrictions to those cases where the need is deemed to be the clearest. In the present case, the Sholapur Company formed a class by itslef because the mismanagement of the Company's affairs prejudicially affected the production of an essential commodity and had caused serious unemployment among labourers. Justice Mukherjee objerved " We should bear in mind that a corporation, which is engaged in production of a commodity vitally essential to the community, has a social character of its own and it must not be regarded as the concern primarily or only of those who invest their money in it. If its productions are large and it had a prosperous and useful carrier for a long perioud of time and is about to collapse not for any economic reason but through sheer perversity of the controlling , one cannot say that the legislature has no authority to treat it as a class by itself and make special legislation applicable to it alone in the interest of the community at large"

सुप्रीम कोर्ट के द्वारा भारत के संविधान के अनुछेद 14 से सम्बंधित चिरंजीत लाल चौधरी बनाम भारत सरकार का ऐतिहासिक फैसला