When Can A Provision Be Held To Be Clarificatory With Retrospective Effect? Supreme Court Explains

The Supreme recently held that for a subsequent order/provision/amendment passed to be considered a clarification to the original provision, it must not expand or alter the scope of the original provision and that the original must be sufficiently vague or ambiguous so as to require such clarification.

The Apex Court observed while it was well established that a clarification or an explanation to clear any ambiguity or correct any glaring omissions in a statute would be applicable retrospectively, it had to consider the question of how such a clarification/ explanation to a statute could be identified and distinguished from a substantive amendment to a statute. “A clarification must not have the effect of saddling any party with an unanticipated burden or withdrawing from any party an anticipated benefit”, the Apex Court observed in this regard.

The Division Bench Comprising Justice K.M. Joseph and Justice B V Nagarathna after referring to a plethora of decisions on the matter culled out the following legal principles

i) If a statute is curative or merely clarificatory of the previous law, retrospective operation thereof may be permitted.

ii) In order for a subsequent order/provision/amendment to be considered as clarificatory of the previous law, the pre-amended law ought to have been vague or ambiguous. It is only when it would be impossible to reasonably interpret a provision unless an amendment is read into it, that the amendment is considered to be a clarification or a declaration of the previous law and therefore applied retrospectively.

iii) An explanation/clarification may not expand or alter the scope of the original provision.

iv) Merely because a provision is described as a clarification/explanation, the Court is not bound by the said statement in the statute itself, but must proceed to analyse the nature of the amendment and then conclude whether it is in reality a clarificatory or declaratory provision or whether it is a substantive amendment which is intended to change the law and which would apply prospectively.”

The Court was considering an appeal filed by the Sree Sankaracharya University of Sanskrit against the order of a division bench of the Kerala High Court that directed the University to grant two advance increments to the 1st Respondent, a Hindi Lecturer at the University, on his placement as a Selection Grade Lecturer. This direction was given in terms of Clause 6.18 of the revised University Grants Commission Scheme of 1998 and a 1999 Government Order.

The 1st Respondent was recruited by the University in 1999 and he was granted four advance increments in terms of Clause 6.16 of the 1999 UGC Scheme which states that a candidate having a Ph.D. degree at the time of recruitment as a lecturer is eligible for four advance increments.

In 2001 he was placed as a Selection Grade Lecturer but two advance increments, payable on placement as a Selection Grade Lecturer for a Lecturer holding a Ph.D. degree as per Clause 6.18 of the 1999 UGC Scheme, were denied to him. Aggrieved by the non payment of the increments, the 1st Respondent approached the Kerala High Court, which ruled in his favour. Later, a division bench of the High Court affirmed the decision of the single bench.

The University took the stand that Respondent No. 1 was not eligible for any further increments based on his Ph.D. degree, on being placed in the selection grade because of a 2001 Government Order which clarified that lecturers who had received advance increments for having a Ph.D. degree, will not be eligible for further increments on being placed as Selection Grade Lecturer. The University was of the view that since the 1st Respondent had already received four advance increments for having a Ph.D. degree, he would not be eligible for two more advance increments at the time of being placed in the selection grade, for being a Ph.D. degree holder.

Sr. Adv. P V Surendranath appearing for the University argued that Clauses 6.16 to 6.19 of the 1999 Government Order showed that a lecturer holding a Ph.D. degree is only entitled to a maximum of four advance increments under all circumstances. The Counsel further contended that the 2001 order issued by the Government was only clarificatory in nature and was part and parcel of the 1999 Order and will have retrospective effect.

Adv. Raghenth Basant appearing for the 1st Respondent argued that the 2001 Government Order could not be said to be a clarification and be made applicable retrospectively. He argued that a reading of Clauses 6.16, 6.18 and 6.19 of the 1999 Government Order could not be construed to mean that a Lecturer who had already received the benefit of four advance increments while being recruited, would not be eligible for two more advance increments on being placed in the selection grade.

The Court considered whether the 2001 Government Order was a clarification to the 1999 Government Order or whether, it amended the latter. If it is in the nature of a clarification if may have retrospective effect but if by its true nature and purport, it is an amendment it would not prospectively apply as it would result in withdrawal of vested rights, the Apex Court observed.

The Court held that the 2001 Government Order ‘substantively modified’ the 1999 Government Order as it restricted the eligibility of lecturers for advance increments. The Court held that withdrawal of benefit of two advance increments from a category of lecturers, was not anticipated under the 1999 scheme and cannot have retrospective effect. Consequently the court affirmed the decision of the Division Bench:

“we are of the view that the subsequent Government Order dated 29th March, 2001 cannot be declared as a clarification and therefore be made applicable retrospectively. The said order has substantively modified the Government Order dated 21st December, 1999 to the extent of stating that teachers who had already got the benefit of advance increments for having a Ph.D. degree, would not be eligible for advance increments at the time of their placement in the selection grade. As noted above, the law provides that a clarification must not have the effect of saddling any party with an unanticipated burden or withdrawing from any party an anticipated benefit. However, the Government Order dated 29th March, 2001 has restricted the eligibility of lecturers for advance increments at the time of placement in the selection grade, only to those who do not have a Ph.D. degree at the time of recruitment and subsequently acquire the same.”

That Apex Court noted that the 2001 order was issued pursuant to a clarification sought by the Accountant General, Thiruvananthapuram on the 1999 order. However the Court observed that:

"merely because the subsequent Government Order has been described as a clarification/explanation or is said to have been issued following a clarification that was sought in that regard, the Court is not bound to accept that the said order is only clarificatory in nature. On an analysis of the true nature and purport of the subsequent Government Order dated 29th March, 2001, we are of the view that it is not merely clarificatory, but is a substantial amendment which seeks to withdraw the benefit of two advance increments in favour of a certain category of lecturers. " 

Case Title: Sree Sankaracharya University of Sanskrit Vs. Dr. Manu

Citation: 2023 LiveLaw (SC) 468

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