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Is it Equitable To Hide Behind Sovereign Immunity To Escape Liability?

Case Name: Kasturi Lal Ralia Ram Jain v. State Of Uttar Pradesh 1965 AIR 1039, 1965 SCR

(1) 375

Bench: Honorable Justice P.B. Gajendragadkar, who was the Chief Justice Of India from 1 February 1964 - 15 March 1966. Justice KN Wanchoo, Justice M.Hidayatullah, Justice Raghubar Dayal and Justice J.R. Mudholkar were the other members of the bench.

Brief Facts: A partner in an Amritsar based firm of jewellers named Ralia Ram was travelling to Meerut. He had in his possession gold weighing 103 Tolas 6 Mashas and 1 Ratti and silver weighing 2 Maunds and 6 1/2 Seers, which he was carrying to sell at Meerut. He was arrested by some police constables under some provisions of the Criminal Procedure Code, 1970 and his belongings were confiscated by the UP police. Later the silver was returned to him and gold was kept in police malkhana, which was misappropriated by a police constable named Mohammad Amir and after misappropriating the gold he fled to Pakistan. So, Ralia Ram brought an action against the State of UP claiming the compensation of rupees 11,000 in lieu of misappropriated gold.

Issues Raised:

  • Were the police officers negligent in dealing with the seized goods?

  • Are the respondents liable to pay compensation to the petitioner under the principle of vicarious liability?

Arguments of Petitioner:

  • Ralia Ram argued that the act done by the constables in arresting him was in excess to the power conferred to them by the state.

  • Petitioner argued that if any property valuing more than 100 Rupees is confiscated by police, as per the provisions of the Uttar Pradesh Police Regulation Act, 1860. It is the duty of the malkhana moharrir to take care of confiscated goods. Mohhamad Amir acting in that capacity misappropriated the goods so this act of Amir attracts the liability of state under the principle of vicarious liability.

Arguments of Respondent:

  • The respondent claimed that they have done nothing exceeding their powers as per Section 54(I) (4) and Section 550 of Cr.P.C, 1970 which gives them powers to arrest someone without magistrate’s order, whom they may suspect reasonably of carrying stolen property.

  • The respondent further argued that they took all necessary care of the confiscated goods and it was the malicious act of Amir only because by doing such an act he was not acting in his course of employment and that is why the state should not be held liable for the act of Mohammad Amir.

Summary of Judgement: [Current status of judgement - Upheld ]

This judgement is based on trail and one of the earliest and major judgements referred was Peninsular and Oriental steam navigation company v. The secretary of state for India, 1861. In this case, it was ruled by Justice Peacock, who was the chief justice of the supreme court of Calcutta that the secretary of state will be liable for the wrongful act of its servants and he will enjoy no sovereign immunity. The principle of Sovereign Immunity is derived from the Latin phrase “ Rex non-potest peccare” which means “ the king can do no wrong” but this principle was changed a bit with the Crown proceeding act, 1947, this act created a demarcating line between the sovereign and non-sovereign functions and the state was made vicariously liable for the non-sovereign functions. Keeping the gold and taking care of it comes under the purview of sovereign functions so the state was absolved from the liability.

One more case named Uma Prashad v. The Secretary of State (1936) which had almost similar facts with the Kasturi Lal case was also referred while giving this judgment. In the case, the employer was not made liable for the unauthorized act of the employee. In the Kasturi Lal case, Justice Gajendragadkar held that the act done by the police officers in dealing with the seized property was a negligent act but as it was authorized to them by the statute so it was a sovereign function. The court held that the claim of Ralia Ram was not sustainable. The appeal was dismissed by the court and the parties of the case were directed to bear their cost throughout. The Allahabad High court showed its dissenting opinion to the judgement of Kasturi Lal case while giving judgement in case of State of UP v. Hindustan Lever Ltd where it was held that hiding behind statutory authority is no defence and it should be proved that said act was done in the exercise of sovereign power.


Shaurya Shukla is currently a 1st Year student at Chanakya National Law University, Patna. You can contact him at https://www.linkedin.com/in/shaurya-shukla-a57b6418b/

Editor: Jayant Upadhyay

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