Source: News Bharati English20 Dec 2016 14:30:40

New Delhi, Dec 20: Contradicting the assertion of the Jammu and Kashmir High Court regarding ‘sovereignty’ and sovereign powers’ of the state, the Supreme Court on Friday said that J & K “has no vestige of sovereignty outside the Constitution of India.”

An SC bench of Justice Kurien Joseph and Justice Rohinton Nariman rejected the state High Court’s view regarding the equal status of the J & K Constitution and the Constitution of India.

Referring to the Preamble of the 1957 Constitution of Jammu and Kashmir, the Supreme Court Bench observed, “It is clear that the state of Jammu & Kashmir has no vestige of sovereignty outside the Constitution of India and its own Constitution, which is subordinate to the Constitution of India… they (residents of the state) are governed first by the Constitution of India and also by the Constitution of Jammu & Kashmir.”

The bench called it “disturbing” that various parts of a judgment in an appeal by the J&K High Court spoke of the absolute sovereign power of the state. “It is necessary to reiterate that Section 3 of the Constitution of Jammu & Kashmir, which was framed by a Constituent Assembly elected on the basis of universal adult franchise, makes a ringing declaration that the State of Jammu & Kashmir is and shall be an integral part of the Union of India. And this provision is beyond the pale of the amendment,” the judges said.

The Supreme Court bench also clarified that the residents of Jammu and Kashmir are Indians “first and foremost”. “It is therefore wholly incorrect to describe it as being sovereign in the sense of its residents constituting a separate and distinct class in themselves. The residents of Jammu & Kashmir, we need to remind the High Court, are first and foremost citizens of India… permanent residents of the state of J&K are citizens of India, and that there is no dual citizenship as is contemplated by some other federal Constitutions in other parts of the world,” the bench said.

The apex court bench pointed that it was constrained to make such observations because in at least three places, the state High Court “has gone out of its way to refer to a sovereignty that does not exist.”

Underlining that the quasi-federal structure of the Constitution of India continues even with respect to J&K, the bench said: “Article 1 of the Constitution of India and Section 3 of the Jammu & Kashmir Constitution make it clear that India shall be a Union of the States, and that the State of Jammu & Kashmir is and shall be an integral part of the Union of India.”

It said the J&K Constitution has been made to further define the existing relationship of the state with the Union of India as an integral part thereof.

The Supreme Court made this observation while deciding a legal question on whether the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) will be applicable to J&K or the law was outside the legislative competence of Parliament since its provisions would collide with Section 140 of the Transfer of Property Act of J&K.

SARFAESI Act entitles banks to enforce their security interest outside the court’s process by moving a tribunal to take possession of secured assets of the borrower and sell them outside the court process. The High Court had said that the state has an absolute sovereign power to legislate in respect of laws touching the rights of its permanent residents qua their immovable properties.

After the State Bank of India appealed against the High Court order, the J&K government submitted in the Supreme Court that this law encroached upon the property rights of permanent residents of the state and must be read down so that it will not be permissible to sell property belonging to a permanent resident of the state to outsiders. It was also argued that Parliamentary legislation would need the concurrence of the J&K government before it could apply to the state under Article 370.

But the Supreme Court bench shot down these arguments, saying SARFAESI Act deals with the recovery of debts due to banks and financial institutions, which is relatable to a subject under the Union List and parliamentary legislation did not require the concurrence of the state government since the Centre had the power to make law on this subject.

“Entries 45 and 95 of List I clothe Parliament with exclusive power to make laws with respect to banking… the Act as a whole would necessarily operate in the state,” the bench said, adding that the SARFAESI Act had itself made a special provision for the sale of properties in J&K.

The bench, however, made it clear that any provision of the J&K Transfer of Property Act will have to give way to the central law in case the former is found repugnant. “It is clear that anything that comes in the way of SARFAESI by way of a Jammu & Kashmir law must necessarily give way to the said law,” it said, adding that its judgement had no effect on Article 35A, which confers on permanent residents of J&K special rights and privileges regarding acquisition of immovable property in the state.

(Additional inputs from agencies)