External Aids to the Interpretation of a Statute

Held. The dealer succeeded. In interpreting items in a statute like a sales tax Act, resort should be had not to the scientific or technical meaning of the terms used but to their popular meaning, that is, the meaning attached to them by those who deal in them, in their commercial sense.

Why it matters. It states the common parlance or commercial sense rule, which is the standing limit on the use of a dictionary, and it is the case to cite whenever an entry in a tax schedule is in issue.

Translations

Where an Act is published in more than one language, or where an Indian statute is a translation of an English original, a court may look at the other text to resolve an ambiguity in the one before it.

Article 348 of the Constitution provides that the authoritative text of every Bill and Act of Parliament and of a State legislature shall be in the English language, and where a State authorises the use of Hindi or another language, a translation in English published under the Governor's authority is deemed to be the authoritative text. So in India the English text ordinarily governs, and a translation is an aid rather than a rival.

The practical use is narrow and it is real: where a word in the English text is ambiguous, the corresponding word in an authorised Hindi text may show which of the possible meanings the legislature had in mind.

Travaux preparatoires

MU prints "Travaux Preparatiories". The expression is travaux preparatoires, French for "preparatory works": the record of the drafting of an instrument, including the successive drafts, the reports of the drafting body and the debates of the conference that adopted it.

The expression belongs to international law, where article 32 of the Vienna Convention on the Law of Treaties 1969 allows recourse to the preparatory work of a treaty as a supplementary means of interpretation, to confirm a meaning or to determine it where the ordinary meaning leaves it ambiguous or obscure or leads to a manifestly absurd or unreasonable result.

Its Indian counterpart is the material behind a Bill: the Bill as introduced, the report of the select or joint committee, and the amendments made along the way. Comparing the Bill as introduced with the Act as passed can be revealing, because a change made deliberately during passage tells you something about intention, and K.P. Varghese is an example of that reasoning at work.

A caution the syllabus invites. Because MU groups travaux preparatoires with the other aids, students sometimes treat any international material as an aid to construing an Indian Act. That is not the rule. What the Supreme Court has done, where there is no domestic law occupying the field, is to read an international norm into the fundamental rights, and that is [Vishaka v. State of Rajasthan] rather than travaux preparatoires.

Statutes in pari materia

The rule

In pari materia means "on the same matter". Statutes dealing with the same subject matter are read together as one system, so that a word given a settled meaning in one may be given the same meaning in another, and a provision in one may illuminate a corresponding provision in another.

Two Acts are in pari materia where they deal with the same subject, or the same class of persons or things, or where one is an amendment or a re-enactment of the other.

The illustration

The Representation of the People Act 1951 and the Jammu and Kashmir Representation of the People Act 1957 are in pari materia, and the Supreme Court said so. In Sharif-Ud-Din v. Abdul Gani Lone, AIR 1980 SC 303, the Court recorded that sections 89(3) and 94(1) of the State Act are in pari materia with sections 81(3) and 86(1) of the central Act, and construed the State provisions accordingly.

Facts. Section 89(3) of the State Act required every copy of an election petition served on a respondent to be attested by the petitioner under his own signature as a true copy, and section 94(1) required the High Court to dismiss a petition that did not comply; the copies in the case were attested by the petitioner's counsel instead.

Held. The requirement was mandatory and the petition was liable to be dismissed. The Court set out the test for deciding whether a provision is mandatory or directory, which is worked in [Interpretation of Directory and Mandatory Provisions]; and it treated the decisions on the central Act as applicable, the two sets of provisions being in pari materia.

Why it matters. It shows the aid doing exactly what the label promises: one Act being construed with the help of the settled construction of another on the same subject.

The limit

Two Acts are not in pari materia merely because they use the same word. They must be on the same subject, and if they are not, a definition in one has nothing to say about the other.

Contemporanea expositio

MU prints "Contemporanea Exposito". The maxim is contemporanea expositio est optima et fortissima in lege, contemporaneous exposition is the best and strongest in law.

The rule

Where a statute is old, and those who had to administer it from the beginning have consistently understood it in a particular way, that long and uniform understanding is evidence of what it means. A court will not lightly disturb a construction on which people have ordered their affairs for a long time.

Its modern form

The pure form of the maxim applies to ancient statutes. What the Indian courts use far more often is a related idea: the understanding of the department charged with executing the Act, expressed in its circulars and instructions.

K.P. Varghese v. Income Tax Officer, Ernakulam, AIR 1981 SC 1922, is the case. Facts. The assessee sold his Ernakulam house in 1965 to close relatives for the price he had paid in 1958, and the Revenue sought to tax a capital gain under section 52(2) of the Income Tax Act 1961 on the footing that the sub section applied whether or not the consideration had been understated. Held. Section 52(2) applies only where the consideration has in fact been understated, and the burden of proving it lies on the Revenue. Among the Court's reasons were two circulars of the Central Board of Direct Taxes, of 7 July 1964 and 14 January 1974, which the Court held were binding on the Department in administering the provision and were in the nature of contemporanea expositio, furnishing legitimate aid in the construction of the sub section, since the highest authority entrusted with executing the Act had understood it as limited to cases of understatement. Why it matters. It is the case that puts departmental circulars inside this aid, and it does so in terms.

The limit

An administrative understanding cannot prevail over the clear words of the Act. The Executive does not make the law by construing it, and a settled practice founded on a mistake is still a mistake.

Debates, and the statement of objects and reasons

This is the aid whose rule has changed, and the change is the examinable point.

The old rule

For many years the position was that parliamentary debates are not admissible as an aid to construction. The reasons given were that a speech is the view of one member and not of the legislature, that the legislature speaks only through the text it enacts, and that what a member said in the House cannot control what Parliament passed.

The statement of objects and reasons attached to a Bill was treated as more limited still: it could be looked at to see the circumstances that led to the Bill and the mischief sought to be remedied, and not to construe the section, because the Bill may be amended out of recognition after the statement is written.

The change

The position has moved, and an answer that stops at the old rule is out of date. Two lines of authority made the change.

The speech of the mover. In K.P. Varghese, the Court used the speech made by the Finance Minister while moving the amendment that introduced section 52(2), saying that it clearly stated the circumstances in which the sub section came to be passed, the mischief for which the section as it stood did not provide, and why the enactment was found necessary. The Court then read the sub section so as to advance that object.

Constituent Assembly debates. In constitutional cases the debates of the Constituent Assembly have been used to understand the intention behind an article, and that use is now routine.

The modern statement of the rule is therefore this: the speech of the mover of a Bill, and the debates, may be looked at to ascertain the mischief the provision was meant to cure and the object it was meant to achieve, but not to control the meaning of clear words. Written that way, the answer is right whichever version of the rule the examiner has in mind, and it says which is current.

Reports of committees and commissions

Where a statute follows the report of a Law Commission, a committee or a commission of inquiry, the report may be looked at to ascertain the mischief the legislature was addressing and the state of the law before the Act.

The rule and its limit are the same as for debates. The report shows the problem; the Act shows the solution the legislature chose, which may be narrower or wider than the report recommended. A court reads the report to understand the question, not to answer it.

This aid connects directly to [The Mischief Rule, or the Rule in Heydon's Case], whose second question is what the mischief and defect was for which the earlier law did not provide. A committee report is often the best evidence of exactly that.

Two further aids worth naming

Judicial decisions on the same words, whether of Indian courts or, more weakly, of foreign courts on similarly worded statutes. Under article 141 the law declared by the Supreme Court binds, so a decision of that Court on the very provision is not an aid at all, it is the law.

International conventions, where no domestic law occupies the field. That is the Vishaka route and it is worked in [Vishaka v. State of Rajasthan].

A worked example

A fictitious Employees Welfare Act 2020 requires an employer to provide "a creche at every establishment employing more than fifty workers". Ramesh Textiles employs forty permanent workers and thirty engaged through a contractor. Is the section attracted?

Internal aids first. Is "worker" defined in the Act? Is "establishment"? Does any Explanation deal with contract labour? Only if the Act leaves the question open does the court go outside.

Dictionaries. "Worker" in a dictionary means anybody who works, which does not settle whether a contractor's employee is a worker of the principal employer. This is the first limit at work: the dictionary supplies the range and not the answer.

Statutes in pari materia. Other labour statutes on the same subject define "worker" and "contract labour", and if the Act belongs to that family the settled meanings in it may be carried across. If the other Act is on an unrelated subject, it says nothing.

Reports. If the Act followed a committee report on women in factories which recorded that creches were denied by keeping the permanent strength below the threshold and hiring the rest through contractors, that report is admissible to show the mischief, and it points to including contract workers.

Debates. If the Minister moving the Bill said in terms that the clause was aimed at that very practice, K.P. Varghese allows the speech to be used to ascertain the object.

Contemporanea expositio. If the department administering the Act has issued circulars for four years telling inspectors to count contract workers, and employers have complied, that is evidence of the settled understanding. It would not survive clear words the other way.

And the limit. If the Act said "more than fifty workers directly employed by the establishment", none of the six aids could be used, because the words are plain. That sentence belongs in the answer.

Distinctions table

What these do NOT mean

An external aid does not override clear words. Every one of the seven yields to the text.

A dictionary does not decide meaning in a taxing statute. Common parlance does.

The statement of objects and reasons is not the Act. The Bill it was written for may have been amended.

"The debates are inadmissible" is no longer the whole rule. They may be used for the mischief and the object, on the authority of the modern cases.

Contemporanea expositio does not let the Executive legislate. A settled departmental practice founded on a wrong reading is still wrong.

In pari materia is not a licence to import any definition. The two Acts must be on the same subject.

Limits and criticism

External aids invite selective quotation. A long committee report or a long debate contains something for everybody, and a court that wants an answer can usually find a sentence supporting it. That is the strongest argument for the old exclusionary rule and it has not gone away.

The change in the rule on debates has never been announced as a change, so textbooks and papers still carry both versions, which is why an answer should state the modern position and note the older one.

Contemporanea expositio favours the administrator. A construction that has been convenient for a department for thirty years acquires weight from its own longevity, and the taxpayer or the citizen who challenges it starts at a disadvantage.

Quick revision

Rule: external aids only where the words are ambiguous, and never against clear words.

Dictionaries: the range, not the answer; the right period; trade meaning governs in a commercial or fiscal statute, Jaswant Singh Charan Singh, charcoal is coal in the commercial sense.

Translations: article 348 makes the English text authoritative; another authorised text may resolve an ambiguity.

Travaux preparatoires: preparatory work; Vienna Convention article 32, supplementary means; in India, the Bill as introduced and the committee reports.

In pari materia: Acts on the same subject read together; Sharif-Ud-Din records the State and central election laws as in pari materia.

Contemporanea expositio: long and uniform contemporaneous understanding; departmental circulars, K.P. Varghese; cannot beat clear words.

Debates and the statement of objects and reasons: formerly inadmissible; now usable for the mischief and the object, K.P. Varghese on the speech of the mover; not to control clear words.

Reports: show the mischief and the earlier state of the law; feed the mischief rule.

Test yourself

1. When may a court resort to an external aid?

Only where the language of the provision is ambiguous, or where its literal reading produces a doubtful, absurd or unworkable result. External aids are material that the legislature did not enact, so they are evidence of intention that is weaker than the words themselves, and they can never be used to contradict words that are plain. A court therefore exhausts the internal aids, meaning the whole of the Act read together, before it looks outside at all.

2. What is the limit on the use of a dictionary in a taxing statute?

That the popular or commercial meaning prevails over the scientific, technical or dictionary meaning. In Commissioner of Sales Tax, Madhya Pradesh v. Jaswant Singh Charan Singh the Court held that in interpreting items in a statute such as a sales tax Act, resort should be had not to the scientific or technical meaning of the terms used but to the meaning attached to them by those who deal in them, in their commercial sense, and on that footing charcoal was held to be "coal" within the entry.

3. What does contemporanea expositio mean, and how has it been applied in India?

It is the maxim contemporanea expositio est optima et fortissima in lege, that contemporaneous exposition is the best and strongest in law: where those who had to administer a statute from the beginning have consistently understood it in a particular way, that long and uniform understanding is evidence of its meaning. In India its most frequent modern use is with departmental circulars: in K.P. Varghese the Court treated two circulars of the Central Board of Direct Taxes as binding on the Revenue and as being in the nature of contemporanea expositio, furnishing legitimate aid to construction.

4. State the modern position on parliamentary debates.

The older rule excluded them entirely, on the grounds that a speech is the view of one member, that the legislature speaks only through the text it enacts, and that what was said in the House cannot control what was passed. The position has moved: the speech of the mover of a Bill and the debates may now be looked at to ascertain the mischief the provision was meant to cure and the object it was meant to achieve, as the Court did with the Finance Minister's speech in K.P. Varghese, and Constituent Assembly debates are routinely used in constitutional cases. What has not changed is that none of this may be used to control the meaning of clear words.

5. When are two statutes in pari materia, and what follows?

They are in pari materia where they deal with the same subject matter, or the same class of persons or things, or where one is an amendment or re-enactment of the other. What follows is that they may be construed together as one system, so that a word given a settled meaning in one may bear the same meaning in the other and the decisions on one may be applied to the other. Sharif-Ud-Din v. Abdul Gani Lone proceeds on that basis, recording that sections 89(3) and 94(1) of the Jammu and Kashmir Act are in pari materia with sections 81(3) and 86(1) of the central Act.

6. Of what use is the report of a committee that preceded an Act?

It is admissible to show the state of the law before the Act and the mischief the legislature was addressing, which is exactly the material the mischief rule in Heydon's Case calls for in its first two questions. It is not admissible to show what the Act means, because the legislature may have adopted a solution narrower or wider than the report recommended, and what was enacted is the text and not the recommendation. A court therefore reads the report to understand the question and the Act to find the answer.