Law of Torts
TORT 051 Liability of the State in Tort Sovereign Immunity and Article 300
Liability of the State in Tort: Sovereign Immunity, Article 300, and the Line from P. and O. Steam Navigation to Nagendra Rao
English law once gave the Crown a personal immunity from suit, expressed in the maxim that the King can do no wrong, and removed it only by the Crown Proceedings Act 1947. India never adopted that immunity whole. The liability of the East India Company was settled before the Crown assumed the government, the succeeding constitutional instruments carried it forward, and Article 300 of the Constitution carries it forward still. What survives is a much narrower idea, drawn from P. and O. Steam Navigation Co. v. Secretary of State: that the State is not liable for acts done in the exercise of sovereign powers. Four decisions mark the movement of that idea from a broad immunity to a narrow residue.
The four decisions, what Article 300 does and does not do, and why the distinction is criticised
1. Article 300
Article 300(1), Constitution of India The Government of India may sue or be sued by the name of the Union of India and the Government of a State may sue or be sued by the name of the State and may, subject to any provisions which may be made by Act of Parliament or of the Legislature of such State enacted by virtue of powers conferred by this Constitution, sue or be sued in relation to their respective affairs in the like cases as the Dominion of India and the corresponding Provinces or the corresponding Indian States might have sued or been sued if this Constitution had not been enacted. |
- It is a procedural and transitional provision, not a charter of liability and not a grant of immunity.
- It names the parties, providing that the Union and the States sue and are sued in their own names.
- It preserves an existing liability by reference back: the Union and the States are liable in the like cases as the Dominion and the Provinces would have been.
- The content of that liability is supplied by the case law, and ultimately by the position of the East India Company, which was liable in its commercial capacity.
- It invites Parliament to legislate on the subject, and Parliament never has. Bills were introduced in 1965 and in 1967 following the Law Commission's recommendation in its First Report of 1956, and both lapsed. The whole subject therefore rests on judicial decision.
2. P. and O. Steam Navigation Co. v. Secretary of State for India
📖 Peninsular and Oriental Steam Navigation Co. v. Secretary of State for India (1861) 5 Bom HCR App 1 Facts Workmen employed by the Government were carrying a heavy piece of iron funnel casing, eight or nine feet long, for the repair of a government steam vessel, along a road near the Kidderpore dockyard in Calcutta. A carriage of the plaintiff company, drawn by a pair of horses, came along the road. The workmen, moving to clear the way, dropped the iron. The noise startled the horses, which bolted and were injured. Held The Secretary of State for India was liable. Ratio Sir Barnes Peacock CJ distinguished two classes of act. Where the act is done in the exercise of sovereign powers, that is, powers which cannot lawfully be exercised except by a sovereign or by a person to whom the sovereign has delegated them, there is no liability. Where the act is done in the conduct of undertakings which might be carried on by private persons without sovereign powers, the government is liable in the same way as a private employer. The maintenance of a dockyard fell into the second class. |
3. State of Rajasthan v. Vidyawati
📖 State of Rajasthan v. Mst. Vidhyawati, AIR 1962 SC 933 Facts A jeep belonging to the State and maintained for the official use of the Collector of Udaipur was being driven back from the workshop to the Collector's residence after repairs, by a temporary employee on probation as a driver. On 11 February 1952 he drove rashly and struck a pedestrian walking on the footpath, who died of his injuries three days later. His widow and infant daughter sued the driver and the State. Held The State was liable. The High Court's decree for Rs 15,000 was upheld. Ratio The State is liable for the tortious acts of its servants in the same way as any other employer. The immunity of the Crown in the United Kingdom was based on the feudal notion that the King could do no wrong and on his personal position as the fountain of justice, and it has no place under a Constitution that establishes a republic and a welfare State which carries on varied industrial and commercial activities through a very large body of employees. Immunity in such a State cannot be justified in principle or in the public interest. Driving a vehicle from a workshop to a residence is not an exercise of sovereign power. |
4. Kasturi Lal v. State of Uttar Pradesh
📖 Kasturi Lal Ralia Ram Jain v. State of Uttar Pradesh, AIR 1965 SC 1039 Facts A partner of the appellant firm, which dealt in bullion, was arrested by the police at Meerut on suspicion of possessing stolen property. Gold and silver found on him were seized and kept in the police malkhana. The silver was returned. The gold was not: the Head Constable in charge of the malkhana misappropriated it and fled to Pakistan. The firm sued the State for its value. Held The State was not liable, notwithstanding the negligence of the police officers in keeping the gold. Ratio The act complained of was done in the purported exercise of the power to arrest and to seize property, conferred by statute. That power is a power that can be conferred only on a sovereign authority, and an act done in the exercise of it is therefore an act referable to the sovereign power of the State. Vidyawati was distinguished: there the servant was engaged in an ordinary employment that anyone might carry on, whereas here he was exercising a power that belongs to the sovereign alone. |
- The decision was criticised from the day it was delivered. The Court itself observed that the position was unsatisfactory and that the remedy lay in legislation.
- It produces an arbitrary line. A person injured by a government jeep recovers; a person whose property is stolen from a police malkhana does not, though in each case a public servant was careless and the State employed him.
- And it has not been overruled, though it has been narrowed so far that it now applies to very little.
5. N. Nagendra Rao and Co. v. State of Andhra Pradesh
📖 N. Nagendra Rao and Co. v. State of Andhra Pradesh, (1994) 6 SCC 205 Facts Stocks of fertiliser and foodgrain belonging to the appellant were seized under the Essential Commodities Act, 1955. Part was confiscated. The rest was not disposed of properly and was allowed to remain in the custody of the authorities, where it deteriorated in quality and diminished in quantity before it was eventually offered back. The appellant sued for compensation. Held The State was liable for the negligence of its officers. Ratio In a welfare State the functions of government are manifold and no longer confined to those of a sovereign in the old sense. Sovereign immunity now survives only for the primary and inalienable functions of a constitutional government: the defence of the country, the raising and maintenance of the armed forces, making peace or war, foreign affairs, the acquisition and retention of territory, the administration of justice, the maintenance of law and order and the repression of crime. For every other activity the State is liable like any other employer. Kasturi Lal is confined to that narrow class, and the exercise of a statutory power to seize goods under a regulatory statute does not fall within it. |
6. Where the Doctrine Stands Now
The activity | Immunity available |
Defence, the armed forces, war and peace, foreign affairs | Yes. These remain inalienable functions |
The administration of justice | Yes, and judicial officers have their own protection under the Judicial Officers Protection Act, 1850 |
The maintenance of law and order and the repression of crime | Formally yes, on Kasturi Lal, but in practice the claim is now brought as a constitutional tort, where immunity is no answer at all |
Running hospitals, railways, transport, factories and hotels | No. These are commercial or welfare activities that private persons carry on |
Regulatory seizure and custody of goods | No, after Nagendra Rao |
Public works, roads, drains and municipal functions | No. A municipal body has no sovereign immunity at all |
Any act violating a fundamental right | No. Sovereign immunity is not available against a constitutional remedy: Nilabati Behera |
⚠ Why the sovereign and non sovereign distinction is criticised The distinction was invented in 1861 to describe a government that did very little beyond defence, revenue and order, and that also happened to run a dockyard. It was never designed for a State that operates railways, airlines, hotels, banks, insurance companies, hospitals, universities and mines. Applied to such a State it has no principled content, because almost everything government does could in principle be done by somebody else, and the courts are left deciding by instinct which activities feel sovereign. The Law Commission recommended abolishing the distinction in its very first report in 1956, and two Government Bills to that effect lapsed. In the absence of legislation the courts have narrowed the immunity almost out of existence, first by confining it to inalienable functions in Nagendra Rao and then, more decisively, by holding in Nilabati Behera that it has no application at all to a claim for the violation of a fundamental right. The result is that the doctrine survives in form and answers almost nothing in substance. |
7. The Position Stated Shortly
1. The English immunity of the Crown was never adopted in India, and Article 300 of the Constitution preserves the liability that already existed.
2. Article 300 is a procedural and transitional provision: it names the parties and refers the content of the liability back to the pre Constitution position.
3. Parliament has never enacted the law that Article 300 invites, so the subject rests entirely on judicial decision.
4. P. and O. Steam Navigation (1861) distinguished acts done in the exercise of sovereign powers, for which there is no liability, from acts done in undertakings a private person might carry on.
5. State of Rajasthan v. Vidyawati (1962) held the State liable for a government driver's negligence, rejecting immunity as inconsistent with a republic and a welfare State.
6. Kasturi Lal (1965) held the State not liable for gold misappropriated from a police malkhana, because arrest and seizure are referable to sovereign power.
7. Kasturi Lal was criticised from the outset and produces an arbitrary line, but it has never been overruled.
8. N. Nagendra Rao (1994) confined immunity to the primary and inalienable functions: defence, foreign affairs, war and peace, the administration of justice, law and order and the repression of crime.
9. Everything else, including hospitals, transport, public works and regulatory custody of goods, attracts liability on ordinary principles.
10. And where a fundamental right is violated, sovereign immunity is no defence at all: Nilabati Behera.