INTERPRETATION OF STATUTES

NATIONAL LAW UNIVERSITY, ODISHA

RETROSPECTIVE OPERATION OF STATUTES

IN

UNDER

INDIA

THE

GUIDANCE

OF

MR. ABHIK MAJUMDAR

ASSISTANT PROFESSOR (LAW)
NATIONAL LAW UNIVERSITY, ODISHA

THIS

PROJECT IS

AUTHORED

BY-

DIKSHA GOYAL (2011/ BBA LLB/ 020)

NILANJAN BHATTACHARJEE (2011/BBA LLB/ 032)

TABLE

OF

CONTENTS

OBJECTIVES...............................................................................................................................2
HYPOTHESIS..............................................................................................................................2
SCOPE.........................................................................................................................................2
RESEARCH METHODOLOGY.....................................................................................................2
CONCEPT OF RETROSPECTIVE OPERATION OF STATUTES.....................................................4
TEST FOR DETERMINING RETROSPECTIVITY.......................................................................5
COMPETENCY TO ENACT RETROSPECTIVE LAWS....................................................................8
COMPETENCY OF LEGISLATURE..........................................................................................8
EXECUTIVE RULES NOT RETROSPECTIVE............................................................................8
EXISTING RIGHTS USUALLY NOT AFFECTED..........................................................................9
APPLICABILITY OF THE RULE TO SUBSTANTIVE RIGHTS........................................................9
PRESUMPTION AGAINST RETROSPECTIVITY..........................................................................10
EXCEPTION..........................................................................................................................11
WHERE TWO INTERPRETATIONS ARE POSSIBLE....................................................................12
EFFECT MUST BE GIVEN TO LANGUAGE IRRESPECTIVE OF CONSEQUENCES...................12
HOW FAR PRIOR STATE OF LAW RELEVANT.........................................................................13
CONCLUSION............................................................................................................................14
BIBLIOGRAPHY........................................................................................................................15

OBJECTIVE
The objective of this project is to analyze the retrospective
operation of statutes through various case laws and to
understand the current position of laws with respect the same.
HYPOTHESIS
The approach that has been adapted by the judiciary is in the
benefit of law and in consonance with the objective law seeks
to achieve. The decisions that is being given by the judiciary
and interpreted by various jurists all over the world would be
limited to the objectives and aims of law. Discretion that is
taken into account is minimal.
SCOPE
This project will delve upon the concept of Retrospective
Operation of Statutes in India. The paper will also analyse the
development of this concept with respect to various judicial
pronouncements. The various tests used to judge the scope of
retrospectivity and its extent of application will also be
discussed in the paper at hand.
RESEARCH METHODOLOGY
We, while constructing this project, have relied on both
primary and secondary sources for research while placing
main reliance on primary sources. We have looked into various

books,

articles,

documents

and

cases

relating

to

the

Interpretation of Statutes. Cases will be analysed so as to find

what is the extent and current position of retrospectivity in
this regard.

INTRODUCTION
Any kind of statute operates in two ways, i.e., a prospective
operations where a statute seeks to govern current activities
and a retrospective operation where a statute seeks to operate
on past events and activities. Though retrospective operation
is not favoured in law rather there is a presumption against
retrospective operation of statutes. Acts, enactments and
administrative

rules

will

not

be

construed

to

have

retrospective effect unless their language requires this result. 1

The use of the term retrospective operation of statutes is at
times bleary & obscure. In a wider sense it would be right
enough to say that statute has retrospective operation when it
purports to operate over those facts or events which took
place before the provision come in to force. It is sometimes
used in a divergent sense when vested rights are sought to be
affected. Also, it is at times loosely used in context of certain
functions of law which the law maker deems it necessary to
1 A.B.Kafaltiya, Interpretation of Statutes (Universal Law Publishing, 2008),
pp.216.

introduce in existing laws for the purpose of setting certain

matters rightly or avoiding certain mischief which might be
possible for change in law; and this is done by penning down
that certain facts or things which did not exist. 2 In this project
we have discussed concept of retrospective operation of
statutes, general principles relating to retrospective operation
of statutes and retrospectively of other statutes with special
reference to various statutes with the help of recent case laws
and with reference to some basic rules enunciated by
prominent authors on the construction of statutes.

CONCEPT

OF

RETROSPECTIVE OPERATION

OF

STATUTES

Retrospective operation is an inaccurate term and somewhat

ambiguous. Since it is very cloudy it is open to interpretations.
Literal meaning of the word retrospective is to look
backward; contemplating what is past; having reference to a
state of things existing before the Act in question. 3 Thus a
retrospective law would be a law which goes back into the
past, contemplates over it, affects acts or facts occurring, or
2 http://www.legalservicesindia.com/article/article/prospective-vs-retrospective517-1.html last visited on 20-2-2014 at 11 p.m.

3 Vepa P. Sarthi, Interpretation of Statutes (Eastern Book Company, 5 th ed,

2010), pp. 326.

right occurring before it came into force. The best instances of

retrospective

laws

are

those,

in

which

the

date

of

commencement is earlier than enactment, or which validates

some invalid law; otherwise, every statute affects rights which
would have been in existence but for the statute.
In the case of Nemi Chand vs. State of Rajasthan 4, the court
said that a statute does not become a retrospective one
because a part of the requisites for its action is drawn from a
time antecedent to its passing. All what it means is that save in
cases where the law creates a new offence or increases a
penalty, a legislature is not prevented from enacting an ex post
facto law but if any such law takes away or impairs any vested
right acquired under an existing law, or creates a new
obligation,5 imposes a new duty or attaches a new disability in
respect to transactions on considerations already past, it must
so provide in express terms or such should be a necessary
implication from the language employed.

TEST

FOR

DETERMINING RETROSPECTIVITY

4Nemi Chand v State of Rajasthan, (1977) Raj LW 430.

5 Ram Prakash v Savitri Devi, AIR (1958) Punj 87.

The question whether a statute operates retrospectively or not

is one of legislative intent. Unless it is provided in the statute
expressly or impliedly, retrospective operation is generally
presumed to be unjust and oppressive. 6 If however, the terms
of statute do not of themselves make the intention of
legislature certain or clear, the statute will be presumed to
operate prospectively7. There are occasions when a law may be
held to be retrospective; however, retrospection of the statute
is not to be presumed, for the presumption is in favour of the
prospective operation of law. Conclusively, court will consider
following factor if the retrospective operation is not expressly
given in the statute8:
They will look into the general scope and purview of the
statute.
The remedy sought to be applied.
The former state of law.
What, it was that the legislature contemplated.
The courts also, while considering the question of the
retrospective operation of statute, considers the nature of the
right affected. Where there is no vested right, an amendment
will be considered as prospective so as not to affect the vested
right. If the right is merely procedural then normally there is
no vested right.9 In case of Shah Bhojraj Mills v Subhas
Chandra10, it was also ruled by the Supreme Court that the
6 Mithilesh Kumari v Prem Behari Khare, (1989) 2 SCC 95.
7 Rashid Ahmed (Mhd) v State of Uttar Prades, AIR 1979 (SC) 592.
8 Zile Singh v State of Haryana, AIR 2004 (SC) 5100.
9 Debi Butta Moody v Bellan, AIR 1959 (Cal) 567.
10 Shah Bhojraj Mills v Subhas Chandra, AIR 1961 (SC) 1596.

statute may be prospective in some parts and retrospective in

other parts.
Generally remedial or curative statutes are always regarded as
prospective,

but

declaratory

statutes

are

considered

as

retrospective. Those statutes that only relates to matters of

procedure or of evidence, are prima facie prospective and
retrospective operation not to be given to them unless, by
express words or necessary implications it appears that this
was the intention of the legislature.11
In State of Bombay v Vishnu Ram Chandra12, dealing with the
question as to how an enactment may be construed as
retrospective, the Supreme Court states that the question has
to be decided in accordance with the following principles:
Penal Statutes are always prospective, but can also
interpreted retrospectively; of there is a clear intendment
that they are to be applied to past events.
Statutes, which create new punishments, but authorize
some actions based on past conducts, if expressed in
language showing retrospective operation, would be
applied retrospectively.
Acts designed to protect the public against acts of
harmful character may be construed retrospectively if the
language admits such an interpretation, even though it
may equally have prospective meaning.
Statute which takes away or impairs vested rights under
existing laws is presumed not to have retrospective
operation.
11 Halsbury Laws of England, Vol. 36 (3rd Ed), pp.423.
12 State of Bombay v Vishnu Ram Chandra, AIR 1961 (SC) 307.

Thus, the principles that have to be applied for interpretation

of statutory provisions are well settled. The first of these is
that statutory provisions creating substantive rights or taking
away substantive rights are ordinarily perspectives, they are
retrospective only if by express words or by necessary
implication, the legislatures has made them retrospective 13;
and the retrospective operation will be limited only to the
extent to which it has been so made by express words, or
necessary implications.
The second rule is that the intention of the legislature has
always to be gathered from the words used by it, giving to the
words their plain, normal and grammatical meaning.
The third rule is that if any legislation, the general object of
which is to benefit a particular class of persons, any provision
is ambiguous so that it is capable of two meaning, one which
would preserve the benefit and another, which would take it
away, the meaning which preserves the benefit should be
adopted.
The fourth rule is that if strict grammatical interpretation
gives rise to an absurdity or inconsistency, such interpretation
should be discarded and an interpretation which gives effect to
the purpose of legislature may reasonably be considered to
have had, will be put on the words, if necessary, and even by
modification of the language used.14
The fifth rule is that where a statute is not clear as to whether
it has retrospective effect and can be interpreted either way on
13 Associated Cement Co ltd v State of Bihar, 1979( Pat) LJ 429.
14 State of M.P. v Poonam Chnd 1968 (Jab) LJ 116.

this point, the court should not give it retrospective effect. 15

Except where necessary, a statute should not be read
retrospectively.16 Pending actions are not affected by new
statute, unless the latter are expressly made applicable to the
former.17

COMPETENCY

TO ENACT RETROSPECTIVE LAWS

COMPETENCY

OF

LEGISLATURE

The Union Parliament and State Legislatures have plenary

powers of legislation within the fields assigned to them.
Subject to certain constitutional and judicially recognized

15 Govind Das v Income-tax officer, AIR 1977 (SC) 552.

16 State of Kerela v Philomina, (1976) 4 SCC 314.
17 Kapen v Provident Investment Co, AIR 1976 (SC) 2910.

restrictions18 legislature can legislate prospectively as well as

retrospectively. Under the constitution there is only one
restriction imposed upon the power of retrospective legislation
under Article 20.19 Competence to make a law for a past period
on a subject depends upon present competence to legislate on
that subject. The power to make retrospective legislation
enables

the

Legislature

to

obliterate

an

amending

Act

completely and restore the law as it existed before the

amending Act.20This power has also often been used for
validating

prior

executive

and

legislative

acts

by

retrospectively curing the defect which led to their invalidity

and thus even making ineffective judgments of competent
courts declaring the invalidity. It is not necessary that the
invalidity must be cured by the same Legislature which had
passed the earlier invalid Act. Thus if a state Legislature
passes an Act subject which fails outside its competence and
the same is within the competence of Parliament and is for
that

reason

held

invalid,

Parliament

can

by

passing

retrospective Act which incorporates the State Act can cure

the invalidity.
EXECUTIVE

RULES NOT RETROSPECTIVE

A legislature can certainly give retrospective effect to pieces of

legislation

passed

by

it

but

an

executive

government

18 T.Bhattacharyya, The Interpretation of Statutes, (Allahabad Law Agency

Publication, 4th edn, 2001),pp.423.

19 Bihar Cotton Mills v Union of India, AIR 1956 (Pat) 131.

20 State of Tamil Nadu v. Arooran Sugars Ltd., AIR 1997 (SC ) 1815.

exercising subordinate and delegated powers cannot make

legislation

retrospective

in

effect

unless

that

power

is

expressly conferred by the parent enactment.21 Hence, the rule

is well-established that even in a case where the executive
government, acts as a delegate of legislative authority, it has
no plenary power to provide for retrospective operation unless
and until power is expressly conferred.22
EXISTING RIGHTS USUALLY NOT AFFECTED
A retrospective operation is not to be given to a statute so as
to impair an existing right or obligation otherwise than as
regards matter of procedure, unless that effect cannot be
avoided without doing violence to the language of the
enactment.23 A statute which impairs vested rights or the
legality of past transactions or the obligations of contract
should not prima facie be held to be retrospective. Every
statute which takes away or impairs vested rights acquired
under existing laws, creates a new obligation, imposes a new
duty, attaches a new disability in respect of transactions
already past, must be presumed to be intended not to have
retrospective effect. It is well settled that a statute is not to be
construed to operate retrospectively so as to take away a
vested right, unless that intention is made manifest by
21 Modi Food Products Ltd v Commr of Sales-tax, AIR 1956 (All) 35.
22Calicut Wynad Motor Service Pvt Ltd v State of Kerela, AIR 1959 (Ker) 247.
23 Rao and Dhanda, N S Bindras Interpretation of Statutes ( Lexis Nexis
Publication, 10th edn, 2012), pp. 1432.

language so plain and unmistakable that there is no possibility

of any choice of meaning.24
APPLICABILITY

OF THE RULE TO SUBSTANTIVE RIGHTS

When the law is altered during the pendency of an action, the

rights if the parties are decided according to law, as it existed
when the action was begun, unless the new statute shows a
clear intention to vary such rights. In the case of Khubi Singh
Yadava

Dist

Judge,

Allahabad 25,

no

vacancy

in

the

accommodation was created on account of transfer of the

tenant,

according

to

the

law

in

force

prior

to

the

commencement of the amending act of 1976. The amending

act did not indicate that any retrospective operation was to be
given to sub-s (3A) of S-12 of the Uttar Pradesh Urban
Building (Regulation of Letting, Rent and Eviction) Act 1972,
therefore, it was held that no vacancy was created by the
transfer which took place before the amending Act came into
force. The question of prospectivity and retrospectivity might
arise in pending suits, suits which were pending on the date
when the amendment Act came into force, to contend that the
amending provision would never be applicable even in future
to a sitting tenant would not be a tenable contention. 26

24 KL Gupta v Municipal Corporation, AIR 1968 (SC) 303.

25 Khubi Singh v Dist Judge Allahabad, 1980 (All) LJ 233.
26 Atar Sing v Third Addl District Judge 1982 All Rent Cas 624.

Whether a person has a right to recover property is a question

of substantive law.27
An enactment conferring substantive rights cannot be given a
retrospective unless the legislature has made an explicit and
express provision to that effect therein or such a consequence
inevitably follows by necessary intendment. 28

PRESUMPTION

AGAINST

RETROSPECTIVITY

As a general rule, every statute is deemed to be prospective,

unless by express provision or necessary implication is to have
a prospective effect. Whether a statute is to have retrospective
effect depends upon its interpretation having regard to wellsettled rules of construction.29 A statute is presumed to be
prospective in its operation and no further retrospective effect
should be given to the provisions of a statute then is expressly
provided therein.30 Retrospection is not to be presumed; but
many statutes have been regarded as retrospective without
declaring so. The statute would operate retrospectively when
the intent that it should so operate clearly appears from a
consideration of the Act as a whole, or from the terms thereof,
which unqualifiedly gave the statute a retrospective operation
or imperatively require such a consideration, or negate the
27 Bireswar v Indu Bhusan, AIR 1954 (Cal) 573-74.
28 Mohari v Chukli, AIR 1960 (Raj) 82-83.
29 Municipal Corporation v Charanjit Law, 1980 (PLR) 7.
30 Ram Dayal v Ganga Prasad, 1983 (All LJ) 255.

idea that is to apply only to future cases. Retrtospectivity is

liable to be determined on few grounds31;
The words used must expressly provide, or clearly imply
retrospective operation.
The retrospectivity must be reasonable and not excessive
or harsh otherwise it runs the risk of being struck down
as unconstitutional.
Where the legislation is introduced to overcome a judicial
decision, the power cannot be used to subvert the
decision without removing the statutory basis of the
decision.
EXCEPTION
Sometimes

statute,

although

not

intended

to

be

retrospective, will, as a matter of fact, have a retrospective

operation. For instance, if two persons enter into a contract,
and afterwards a statute is passed, engrafts an enactment
upon an existing contract, and thus operates so as to produce
a result which something quite different from the original
intention of the contracting parties, such a statute has, as a
matter of fact, a retrospective operation. It is a familiar rule
that no statute is construed to be of retrospective operation
unless the terms of the statute expressly state that it is
retrospective or such a construction arises by necessary
implication. The rule is based on the presumption that the
legislature does not intend what is unjust or that transactions

31 Rao and Dhanda, N S Bindras Interpretation of Statutes ( Lexis Nexis

Publication, 10th edn, 2012), pp. 1432.

which have already vested title to property should be reopened

or thrown into doubt.32
It is well recognised that the canon against retrospective
interpretation does not apply to a statute dealing with an
adjective law, i.e., procedure, and we think that a statute
abolishing old legal fictions is so nearly akin to a procedural
statute that the canon can have little if any, application.33
WHERE

TWO INTERPRETATIONS ARE POSSIBLE

If an enactment is expressed in language, which is fairly

capable of either interpretation, it ought to be construed as
prospective only.34 Even in construing a section which is to a
certain extent retrospective the maxim must be borne in mind
as applicable whenever the line is reached at which words of
the section cease to be plain. 35 The question as to whether a
statute should have a prospective and retrospective as well
can only arise only when the words of the statute are capable
of giving the enactment both prospective and retrospective
effect. The question can never arise if the words of the statute
make it clear that it should have prospective effect only. 36 Even
admittedly retrospective legislation is limited by the clearness
of its retrospectivity; and, also, rights that have passed from
32 Ibid.
33 Kishri Lal v Devi Prasad , AIR 1950 (Pat) 50.
34 Daulat singh v State, AIR 1950 (MB) 112-113.
35 Abdul Ruzak v Kuldip Narain, AIR 1944 (Pat) 147.
36 Firoz Ahmed v Akbar Ali, AIR 1943 (Lah) 238.

the original contractual or relational character into rights

measured by judicial determination are prima facie, outside
retrospection, which usually applies to rights not yet so
determined.37
EFFECT MUST BE GIVEN

TO

LANGUAGE IRRESPECTIVE

OF

CONSEQUENCES
If the meaning of words used indicates an intention that the
Act is to have retrospective operation, then, no matter, what
the consequences this operation must be given to the
provisions.38 No doubt whenever the intention is clear that the
Act shall have retrospective operation, it must unquestionably
be so construed even if the consequences may appear unjust
and hard.39 If there are words in the enactment which either
expressly or by necessary intendment (eg from the object of
the statute) imply that the statute is to be given retrospective
operation even in respect of substantive rights or pending
actions, the courts have no other alternative than to give such
operation to the statutes even though the consequence may
appear to be unjust or hard.40 In determining whether any
provisions of an Act was intended to be retrospective or not,

37 Fedrated Assn of Australia v Broken Hill Proprietary Co Ltd, 16 (LRC) 245.

38 Rashid Bibi v Tuftail Muhammad, AIR 1941(Lah) 291-92.
39 Gopal Vakta v Gopal Munshi, AIR 1941(Cal) 432.
40 M L Bagga v Murher Rao, AIR 1956 (Hyd) 35.

the consequences of holding that it is not retrospective must

be looked at.41
HOW

FAR

PRIOR STATE

OF

LAW RELEVANT

When the question for consideration is whether a statute is

retrospective so as to affect existing rights, it is impossible to
determine the question without considering the prior state of
the law.42 The courts have sometimes taken into consideration
the state of law which was there at the time when the
Amendment act was passed.43 In fact, we must look at the
general scope and purview of the statute, and at the remedy
sought to be applied, and consider what the former state of
law was and also what was that the legislature contemplated. 44
But laws made justly and for the benefit of individuals and the
community as a whole, as in this case, may relate to a time
antecedent to their commencement.

CONCLUSION
Every

other

statutes

leaving

those

which

are

merely

declaratory or which relate only to procedural laws or in which

evidence

are

prima

facie

prospective

41 Jagdamba Prasad v Anadi Nath, AIR 1951(MB)1.

42 Gulab Chand v Kudilal, AIR 1943 (SC) 423.
43 Supra note 41.
44 Pardo v Bingham, AIR 1991 (SCW) 1651.

and

retrospective

operation should not be given to a statute so as to affect, alter

or destroy an existing right or create a new liability or
obligation unless the effect cannot be avoided without doing
violence to the language of the enactment. If the enactment is
expressed in language which is fairly capable of either
interpretation, it ought to be construed as prospective only.
Where the language of statutes is susceptible of both
interpretation

then

prospective

interpretation

must

be

preferred which provide for moderate & harmonious position.

BIBLIOGRAPHY

STATUTES REFERRED
Constitution of India, 1950
Criminal Procedure Code, 1973.
Indian Penal Code, 1860.

BOOKS
A.B.Kafaltiya, Interpretation of Statutes (Universal Law
Publishing, 2008).
Vepa P. Sarthi, Interpretation of Statutes (Eastern Book
Company, 5th ed, 2010).
Halsbury Laws of England, Vol. 36 (3rd Ed).
T.Bhattacharyya,
The
Interpretation
of

Statutes,

(Allahabad Law Agency Publication, 4th edn, 2001).

Rao and Dhanda, N S Bindras Interpretation of Statutes
(Lexis Nexis Publication, 10th edn, 2012).
D.N. Mathur, Introduction to Interpretation of Statutes,
(Wadhwa publication, 2nd edn, 2005).
V.P.Sarthi, Interpretation of statutes,

(Eastern

Book

Company Publication, 4th edn, 2005).

G.P. Singh, Principles of Statutory Interpretation, (Lexis
Nexis Butterworths Publication, 11th edn, 2008).
St. J. Langan, Maxwell on the Interpretation of Statutes,
(12th edn., 1969).

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