Facts
- Nagendra Rao carried a business of fertilizers and food grains under a license
- On 11 August, 1975 the Police Officer, Vigilance Cell visited its premises and seized a huge stock of fertilizers, food grains and non− essential goods.
- After repeated requests, the collector ordered that the goods be returned to the appellant.
- However, the AAO did not comply with the orders.
- After repeated consultations with various ministers, when the appellant finally obtained the stock back but it was spoiled both in quantity as well as in quality.
Law commission of India
- First report on the liability of the state in tort ( May, 1956)
- Sovereign right against Fundamental rights −
- PUDR v. State of Bihar− There was a police firing without any warning and justification on a group of poor peasants and landless persons, who had collected for a peaceful meeting. At least 21 persons had died and many more were injured. The Supreme Court held that the State was liable to pay compensation Rs. 20,000 for every case of death, and Rs. 5,000 for every injured person
Rudul Sah v. State of Bihar [AIR 1983 SC 1086].
Principles
- Issue Before the Court
- Whether the seizure of the goods in exercise of statutory powers immunizes the state, completely, from any loss or damage suffered by the owner.
- Whether confiscation of part of the goods absolves the state from any claim for the loss or damage suffered by the owner for the food grains which are directed to be released or returned to it.
- Ratio of the case
- Vidhyawati case − liability imposed − not sovereign
- State was performing welfare function − must ensured the preservation of stocks
- The Apex Court in Kasturilal Case, held that that state cannot be held liable to compensate the appellant as the act of the state falls under the sovereign function of the state.
- Now, since the doctrine has become outdated and sovereignty rests with the people, the state cannot claim any immunity. Thus, the state of Andhra Pradesh was directed to pay the appellant the amount as directed by the trial Court.
- No defense when state was involved in commercial or public activity − state can not have absolute power to act according to its whims and fancies
Torts committed by the servants of the State in discharge of
obligations imposed by Law
- Smt Basava v. State of Mysore –Similarly, if the stolen property recovered by the police was not kept carefully and it got stole again, the State was held liable for the same.
- In State of Gujarat v. Memon Mahomed, the Supreme Court held the State liable, when the custom authorities, who had seized certain vehicles on the charge of smuggling and disposed them of before the Revenue Tribunal set aside the order of confiscation and ordered the return of those vehicles.
