Holding

The specific customs duty notifications on newsprint are unconstitutional as they are unreasonable and not a valid exercise of the power to tax, requiring the Government to reconsider the levy.

Summary

The petitioners, a consortium of newspaper publishers, challenged the imposition of customs and auxiliary duties on imported newsprint under the Customs Act, 1962 and the Customs Tariff Act, 1975, arguing that the levy infringed their freedom of speech and expression (Art. 19(1)(a)) and the right to practice a profession (Art. 19(1)(g)), and that the classification of newspapers into small, medium and large violated Art. 14. The Court held that while the power to tax newspaper industry is constitutionally permissible, the specific notifications issued under Section 25 of the Customs Act were unreasonable and not exercised in accordance with the public‑interest criteria required by Art. 19(2). It emphasized that any tax affecting newsprint must be examined with heightened scrutiny because of its intimate link to the freedom of the press. The Court ordered the Government to reconsider the levy within six months and to limit recovery to the reduced duty of Rs. 550 per tonne pending a fresh determination. The petitions were allowed, and the impugned notifications were set aside.

Issues considered

The constitutional validity of customs duty on newsprint under Art. 19(1)(a) and Art. 19(1)(g).
Whether the classification of newspapers for duty purposes violates Art. 14.
Whether the notifications issued under Sec. 25 of the Customs Act, 1962 are unreasonable and beyond the scope of delegated legislation.
Whether the levy constitutes a reasonable restriction under Art. 19(2).
The extent of judicial review over subordinate legislation affecting fundamental rights.

Legislation cited

Constitution of Indias. Art. 13(3)(a), s. Art. 14, s. Art. 19(1)(a), s. Art. 19(1)(g), s. Art. 19(2), s. Art. 32, s. Art. 41
Customs Act, 1962s. 12, s. 25
Customs Tariff Act, 1975s. 2, s. Heading 48.01/21 (Sub‑heading 2)
Finance Act, 1981s. 44
Finance Act, 1982s. 44, s. 45

Subjects

freedom of pressArticle 19customs dutynewsprinttaxationreasonable restrictionArticle 14subordinate legislationpublic interestjudicial review

Judgment

287

INDIAN EXPRESS NEWSPAPERS (BOMBAY)
PRIV.ATE LTD. & ORS. ETC. ETC. B
v.

UNION OF INDIA & ORS. ETC. ETC .
•
December 6, 1984
c
[0. CHINNAPPA REDDY, A.P. SEN AND E.S. VENKATARAMIAH, JJ .)

· Constitution of India 1950, Article 19(1)(a)-Freedom of speech and expres.
,ion-Whether includes Freedom of press-Restrictions other than those tn Article
19~2)-Whether reasonable-Interference in the name of Public Interest-Whether
Justified.
D
Roll of PreSJ and Newspaperr-Duty of Court to held the balance even and
to strike down any unconstitutional invasion of press.

fandamental rights under Article J9(J)(a) and (g)-Whether different from
right conferred by First Amendment to American Constitution.

Article J3(3)(a)-Notification under section 25 Customs Act 1962-Contrary
to fundamental rights-Whether to be struck down.

Article 14-Classijication a/ newspapers for levying customs duty-Whether
discriminatory.
Article 41-Duty of State to encourage education of mas1es through media
ofpm•-Necesslty of. F

Entry 87 and 93, List 1. Seventh Schedule-Newspaper Industry-Levy of
tax-Competency of Parliament to enact laws-Scrutiny by Courts When arises
-Tax transgressing into the field of freedom of speech and expression and stifles
that freedom-Whether unconstitutional.

Article 32-Validity of tax-Duty of Court-Not to be burdensome-New1.. G
paper Industsy not to be sif,gled out-Custom Duty on newspaper-Whether tax
on know/edge-People's right to know-Imposition of tax-Government to be more
cautious.

Interpretation of statuteJ :

Co111tltutlon of India 1950, Article 19(/)(al-l•terpretation of-American H
288 SUPRBl.tll COURT REPORTS [1985] 2 S.C.11.. !...'.·
A
cases-Whether sole guide-Help In understaMlng the ba&ic principles offrtetfom
of 1peech and expre11lon.
•
Statutes Taxing Newsprint-Tests for determining vires of-Different from
other taxing statutes-Grounds of challenge . .

Customs Act/ 1962, Settion '25-Power to grant exemption-Whether
B
legislative power-Whether notlfi~ation a Subordinate plece. of legislation -
Whether questi'onab/e on the Kround of unreasonableness-Power of Govr",.nment
· di1cTetionary but not unrestricted. '

Customs Act, 1962, Section 25-Notification Substitution of by another--
Whether former notification would rerire if the latter is held inra/id.
•
Customs Tariff Act, 1975, Section 2 and Seco•d Schedule Heading 48.01/21
-Sub-heading 2-Newsprint-lmport duty and auxiliary levy at a flat rate--
Validity of.

Under the Indian) Tariff Act. 1934, there was a levy of customs duty on
imPQrted.!lllper. Exemption, however, had been granted for import of white,
D grey or unglazed newsprint from the levy of any kind of cus\oms duty in excess
of !.5% ad vaforem but subsequently a specific import duty of Rs. 50 per MT
was levied on newsprint imports upto 1966. The Inquiry Committee on Small
Newspapers examined the question of customs duty on newsprint and Sl!bmitted
its report in 1965 recommending total exem~tion of newsp;int from Customs
duty. Pnrsilant to the said recommendation, the Government abolished
customs duty on newaprint altogeth<:r in the year 1966. In 1971, a rogutatoey
E duty of2·1/2% wa1 levied on newsprint imports. This 2-1/2% regulatory duty
· was abolished and was converted into 5% auxiliary duty by the Finance Act of
1973. On the Customs Tariff Act 1975 coming into force, the Indian Tariff
Act 1934 was repealed. Under aection 2 read with Heading No. 48.01/21 of
the Fit11t Schedule to the 197S Act, a levy of basic customa duty of.40% ad
valorem was imposed on newsprint. However, the 5% auxiliary duty ,levied from
April I, 1973 continued to be in OP,eration which was also totally abolished in
F July 1977. The total exemption from customs duty on newsprint continued
till March J, 1981 when notification dated July 15, 1977 granting total exemp-.
tion from customs duty superseded by the issue of a fresh notification under
which publishers oi newspapers had to pay 10% ad va/orem customs duty on
import~rnewsprint. By another notification issued at about the same time the
auxiliai:y duty imposed by the Finance Act of 1981 above 5% ad 1•a/orem was
G exempted in the case of newsprint.· The result was that a total duty ·of 15%
adv4lorem came to be imposed on newsprint for the year 1981·82, which led
to the increase in the price of newspaper resulting in fall in circulation of news..
papers. In the first set of writ petitions this 15% levy was challenged.
•
During the pendency of thCse writ petitions while Customs Tariff Act,
1975 was amended levying 40% ad valorem plus Rs. 11)00 pet MT as customs
duty on newsprint, the auxiliary duty payable on all goods s~bject to customs
H duty was increa•ed to 50% ad vaforem .. D~t by notification dated Februray 82.
iNOiAN llXPRE"!l v. UNION ' 289
1982 issued under section 25(2) of the Customs Act 1962 the notification
dated March 1, 1981 was superseded and Rs. 550 per tonne was imposed as
A
customs duty on newsprint and auxiliary duty was fixed at Rs. 275 per tonne.
In all Rs. 825 per tonne of newspaper had to be paid as duty.

'Under the newsprint policy of the Government there were three sources
of supply of newsprint--{i) high seas sales, (ii) sales from the buffer stock built
up by the State Trading Corporation which includes imported newsprint, and. B
(iiQ newsprint manufactured in I11dia. Imported newsprint is an important
component of the total quantity of newsprint utilised by any newspapef ·
establishment .
• The validity of the imposition of import duty on newsprint imported· from
abroad under section 12 of the.Customs Act 1962 (Act 52of1962) read with
section 2 and Heading 1'0. 48.01/21 Sub-beading No. (2) in the First Schedule
to the Customs Tariff Act, 1975 (Act 51 of 1975) and the levy of auxiliary duty
under the Finance Act, 1981 on newsprint as modified by not.itications issued
under aection 25 of the Customs Act 1962 with effect from March 1, 1981 was
challenged in the writ petitions.'

In the writ petitions it was contended :(I) that the imposition of the
import duty has the direct effect of crippling the freedom of speech and expres• D
sion guaranteed by the Constitution as it led to the increase in the price of news-
papers and the inevitabJe consequence of reduction Qf their circulation ; (2)
that with the growth of population and literacy 'in the country every news-
paper is expected to register an automatic growth of at Jeast S% in its. c:i,rcuJa-
tion every year but this growth is directly f.lmpeded by tl!e ~ncrease in the price
of newspapers ; (3) that the method adopted by the Custom! Act, 1962 and the
Cu11toms Tariff Act, l 97S in determining the rate of impOrt duty has e,g;posed E
the newspaper publishers to Executive interference; (4) that there w~ no need
to impose customs duty on newsprint which had enjoyCd tQtaJ .exemptl9ri froll)
its payment till March l, 1981, as the foreign exchange position was quite
comfortable. Under the scheme in force, the State Trac\ing Corporation of
India sells newsprint to small newspapers with a circulatiOn of less than 15,000
at a price which does not iCclude any jmport duty, to medium newspapers witbr
F
a circulation between 15,000 and 50,000 at a price which includes 5% ad valorent
duty (now Rs. 275 per MT) and to big1newspapers having a circulation of
over 50,000 at a price which includes the levy of 15% ad valorem duty (now Rs.
825 per MT). This classification of newspapers' into big, medium and small
newspapers ii; irration,al as the purchases on high seasiare sometimes effected by
a publillher owning many newspapers which may belong to different classes ; (5)
that the enormous increase in the price of newsprint subsequent to March 1, G
1981 and the iatiationary economic conditions which led to higher cost of
production have made it impossible fot the industry to bear the duty any
• tonger. Since the capacity to bear the duty is an .essential element in determin-
ing the reasonableness of the levy, the continuance of the levy i• violative of
Article 19(1)(a) and Article 19(l)(g) of th• Constitution. The imposition of the
levy on large ne,..papers by the Executiv<>'is done with a view to stiflina circula-
tion of newspapers which are highly critical of the perfonnance of the admlnis-
ff

,
' ___ ~
290 Sl/PIU!Mll COURT llEPOl!.TS [1985]' 2 s.c . 11..
trat!~n. .The classification of newspapers into small, medium and big for
puriioses of levy of import duty iB violative of Article 14 of the Constitution ;
and (6) that the power of' the Government to levy taxes of any kind on the
ne\VSpaper establishment rings the death.knell of the freedom of press and
would be .totally against the spirit of the Constitution.

The Union of India contested the writ petitions alleging (I) that the Govern-
ment bad levied the duty in the public interest to augment the rcveoue of the
o·ovcrnmcnt. When exemption is given from the customs duty, the Executive
has to satisfy itself fhat there is some other corresponding pubJic interest justify-
ing such exemption and that in the absence of any such public interest, there is
no power to exempt but to carry out the mandate of Parliament which has
fixed the rate of duty by the Customs Tariff Act, 1975 ; (2) that the classifica- •
tion of'neWspapers for purposes of granting exemptiOn is done in the public
c irtterest having regard to relevant considerations, and that the levy was not ma/a
fide. Since every section of the society.has to bear its due share of the "economic
burden of the state;·1evy of custdms duty on newsprint cannot be considered to
be violative of Article 19(1) (a). The plea that the burden of taxation is e<ces-
sive is an.irrelevant factor to the levy of import duty on newsprint ; (3) that
the fact that the foreign exchange position was comfortable was no bar to the
imposjtion of import cjuty ; and (4) since the duty imposed is an indirect tax
which would be borne by the purcbaS<r of newspaper, the petitioner could
not feel aggrieved by it. ·

Allowing theWrit Petitions,

HELD : I. The expre11ion 'freedom of press' has not been used in
Article 19 of the Constitution but, as declared by this Court, it is included in
E, Article 19 {I) (a) Which guarantees freedom of speech and expression. Free-
dom of Press means freedom from interference from authority which would
have the etfect of interference with the content and circulation of news:.
papers. [310C; 351]

2. :'There could not be any kind of restriction on the freedom of speech
and expression other than those mentioned in Article 19 (2) and it is clear that
F thete could not be any interference with that freedom in the name of public
interest. Even when clause (2) of Article 19 was <ubsequently substituted
under the Constitution (First Amendment) Act, 1951 by a new clause which
permitted the imposition of reasonable reStrictions on the freedom of speech and
expresSion in the interests of sovereiloty and integrity of India, these urity
of the State, friendly relations with foreign States, public order, decency- -or
G morality in relation to contempt of cout:t, defamation or incitement to an offence.
Parliament did. not _choose to inclpde a clause enabliog the imposition
of reasonable restrictions in the public in.terest. (3J2B-CJ
•
-~j
3. Fr~dom of press js thelleart of social and political intercourse. The
press has now • .,.urned the role of the public educator making formal and
non-for111al education possible in a large scale particularly in the developing
world, wh~re television. and o\h\lr kinds of modern comlllQnication are 11ot
fl '.
INDiAN EXPRESS v.· lJNlON ' ~91

still available for all sections of societ'y. The purp0se of the piess· is to 3.dvance
the pubJic interest by pub!hhing facts and opiniOns withOut which. a demo- A
cratic electorate cannot make responsible judgments. Newspapers being
purveyors of news and views- having a bearing on public administi'ation very
often carry material which Would not be palatable to governments and other
authorities. With a view to thecking malpractices which inierfere with free
flow of informatioO., democratic constitutions all over the world have made
Provisions guaranteeing the fri!cdom of speech and expression laying 'down the
limits of interference with it. [316B-D; HJ B
It is the primary duty of all the national courts to uphold the said free-. ·
dom and invalidate all laws or administrative actions which interfere
• with it, contrary to the constitu~ionaCmandate. [3l7A] .
· Brij Bhushan & Ani-. v, The State of Delhi,' [1950} ·~;.C.R.' ·605, Bennett
Coleman & Co. & OTs. v. Union of India & Ors·. [1973J 2 S.C.R. 757, Romesh
Thappar v. The State of Madras; 1950 S.C.R. 594, Express Ne.wspapers (Privtite) c
Ltd. &: Anr. v. Tile Union of India & Ors., [1959] S.C.R. 12 and Sakal Papers
(P; Ltd. & Ors v. T7ze Unfon of India, (1962] 3 S.C.R. 842,fo//owed•.
·'
- 1 Annals of Congress (1789-96) p. 141 ; D.R. Mankekar: The Press under
~Pressure (1973) p. 25 ; Article j9 ·of the Universal Declaration of Human Rights,
[1948 : Article 19 of the International Covenant on Civil and Political Rights,
1966 ~·Article JO of the Europe~n Con11elztion on Human Rights: First Amend- D
ment 'to the Constitution of the United States of America ; 'Article by Frank C.
Newman and Karel Vasak on "Civil and political Rights' in the International
Dimensions of Human Rights (Edited by Karel Vasak) Vo. l,pp.155·156; "Many
VoiceS, One Worldn a publication of UNESCO containing the Final Report of -
the International Commission for the Study of Communication Problems, Part V
dealing with 'Communication Tomorrow' p. 265; Article entitled "Toward a
G_eneral Theory of the First Amendment' by Thomas I. Emerson (The Yale Law E
Journal, Vol. 72, 877 at p. 905: Second Press Commission Report (Vol.I.
pp. 34.35). referred to.
S. (i) Excluding sm1ll newspaper establishm1:nts · having circulation
of less than about 10,000 ~opies a day, all other bigger ·newspaper establish~
meats have ·the characteristics of a large industry. The Governinent has to
provide_ many services to them resulting in a big drain on the financial
resources of the State as many of these services are heavily subsidized. F
Naturally such big newspaper organisations have to contribute their due share
to the public exchequer and have to bear the common fiscal burden like' au
others. [324C ; EJ ·'
(ii) While ex.amining the constitut"ionality of a law said tO be contra·
veniag Article 19 (l) (a) Or the Constitutiori, the.decisions of ·the Supreme
Court of the United States of America cannot be solely relied upon for
guidance but _couid be taken into consideratiori fof understanding the basic G
• .principles of freedom of speech and expressiyn and the need for that freedom
in a democratic country.· [324F·G]
(iii) The pattern of Article 19 (I) (a) and of Article.19(1)(g)ofth~:
Indian Constitution is different from the pattern of the fitst AmCDdment to the
American Constitution which is almost absolute in its terms. The rights
guaranteed under Aniele 19 (I) (a) and Article 19 (I) (g) of the Constitution .ff

'
292 SUPREME COURT REPORTS [1985) 2 S.C.R.
arc to bC read alongwith clauses (2) and (6) of Article 19 which carve out areas
A in respect or which valid legislation can be made. (324H ; 325AJ
6. Newspaper industr)' has not been granted exemption from taxation
in express terins. Entry 92 of List I of the Seventh· Schedule in the ·consti-
tution empowers Parliament to make laws levying taxes on saJe or Purchase
or newspapers and on advertisements . published therein. The power to levy
customs duties on goods imported into the country is also entrusted to Parlia-
B ment by Entry 83 in List I of the Seventh Schedu1e' to the ConStitution.
[325B ; 326G]
.. 7.- The First Amendment, to the Constitution of the United States of
America is almost in absoJute terms and, therefore, r.o Jaw abridging the
freedom of the press can be made by" the Congress. ·Yet the American Courts
have recognised the power of the State to_ levy taxes on newspapers establish·
ments.subjecttOjudicialreview.bycourts by the application of the due pro.
c ccss of law principle. [328E-FJ

8. The police'Power•. taxation and eminent domain are all forms of
social control which ai.-e essential for peace and good government. In India the
power to levy tax on persons carrying on the business of publishing n:!wspapers
has got to be rCcoitlised as it is inherent in the vefy Concept of government:
But the exercise of 5UCh power should. however. be subject to scrutiny by
D courts. Entry 92 · of List I of the Seventh Schedule to the Constitution
expressly suggests th~ e~iste~ce of such power. [328G ; 329C]
..
' 9. It is not necessary for the press to be subservient to the Government.
As tong as 'this Court sits• newspapermen need not- have the fear of their
freedom being curtailed hy unconstitutional mean5. It is not acceptable 'that
E merely beCause the Government has the power to levy taxes. the freedom of
press would be totally lost. The Court is always there to hold the balance even.
and to strike down any uncons~itutional invasion. of.that freedom. [338G ; 339Fl

10•. Newspaper industry enjoys two or the fundamental rights, namely,
the freedom of speech and expression guaranteed under Article 19 (1) (a) _and
the freedom to engage in any profession, occupation, trade, industry or busi-
. F ness iuarantced under Article 19 (I) (g). While there can be no tax on the
right to exercise freedom of ei:pression. , tax is Jeviable on profession, occu·
pation. trade, business and industry. Hence tax is leviable · on newspaper
industrY. But when such .tax transgresses into the field of freedom of ex·
pression and stifles that freedom. it becomes unconstitutional. As long as
it is within reasonable limits and does not impede freedom of expression it '
will not be contravening the limitations Or Article 19 (2). The delicatC . task
G of determining when it crosses from the area or p[ofession, occupation,.
trade. business or industry into th'e area of freedom of expression and_ inter·
Ceres with that freedom is eiltrusted to tb-e Courts. [339G·H; 340A-B] •
_ . 11. White ~levying a tax on newspaper industry it must. be kept in mind
that it should not be an over-burden on newspapers which constitute the Fourth
Estate or the· country. Nor should it singtC out newspaper industrY for harsh
treatment. Imposition ofa tax Jike the customs-duty- on _ r.ewsprint is an
e imposition·. on knOwtedgC 3.nd 'wou!d virtually amOUnt to'a burderl imposed on
, .
INDIAN EXPRESS P. UNION 293
a man for being literate and for being conscious of his duty as a citizen to
inform himse1f about the world around him. 'The public- interest in frredom A
of discussion (of which the freedom of the press is one aspect) stems from
the requirement that members of a democratic society should be sufficiently
informed that they m1y influence inteUigentJy the decisions which may affect
'themselves'. [34JH ; 342A·Bl

J2. FreeJom of expression has four broad social pfilposes to ~erve: (i)
it helps an individual to attain sdf fulfitIDeat. (ii) it assist.io in the di~overy of B
truth, (iii) it strengthens_ the capacity of an individual in p:irticipating in dl!cisiori.
making, and (iv) it provides a mechanism . by which it would be possible to
• eStablish a reasonable balance between stabifity and social change. All members
of society shou!d be able to form their own beJiefs and communicate them
freely to others. In su!:n. the fundJ.mental principle is the people's fight to
know. Freedom of speech and expression should, therefore~ receive a generous
support from all those who believe in the participation or people in the
administration. It is on account ·of this special interest' which Society has in
c
the freedom of speech and expression that the approach of the Government
should be more cautious while levying taxe.S on matters concerning newspaper
industry than while levying taxes on other matters. (342C~E]

13. In view of the intimate connection of newsprint with the freedom
of the press. the tests for determining_ the vices of a statute taxing newsprint D
have, therefore. to be different from the tests usua!Jy adopted for testing the
vires of other taxing statutes .. In the case" of ordinary taxing statutes, the Jaws
may bC questioned oaly if they are either openly confiscatory or a colourable
device to confiscate. qn the other band, in the case of a tax on newsprint, it may·
be sufficient to show a distnct and noticeable burdensomeness, clearly and
directly attributable to the tax. [3420-H)
E
' Constituent A.<semh/j./Jebates. Vol. IX pp. 1175-1180 dt. September 9,1949:
Corpus Juris Secundum (VoJ. -16) p. 1132; American Jurisprudence 2d (Vol. 16)
p. 662; Article on the First Amendment by Thomas I. Emerson (The Yale Law
Journal, Vol. 72 at p. 941); Second Press Commission Report (Vol.J) p. 35;
Essay No. 84 by Alexander Hamilton in 'The Federal!st,; Alice Lee Grosjean,
Supervisor of Public Accounts for. the State of Louisiana y. American Press
Company. 291 U.S. 233 : 80 L. ed. 660; Robert Murdock Jr. v. Commonwealth
of Pennsylvania (City of Jeannette). 319. U.S. IOS: 87 Law. ed. 1292 and F
Attorney General&: Anr. v. Antigua Times' Ltd.• [1975] 3 AJI ~· R. 81. referred
• to

Bennett Coleman d: ·Co. &: Ors. v. Uni~n of India & Ors.• [1973] 2 S.C.R.
157 and Sakal Papers (P) Ltd. & Ou. v. The Union of· India, [1962) 3 S.C.R.
842, distinguished. G

Attorney General v. Times Newspapers, [1973] 3 All. E.R. S4, followed.

14, In the instant cases, assum;ng that the power to gr~nt exemption
under. section 25 of the Customs Act, 1962 is a JegisJative power and a
notification issued by the Government thereunder amounts to a piece of H
294 SUPREME COURT REPORTS [1985] 2 s.C.R.

subordinate legislatio~ even then the notification_'.is liable to be questioned on
A
the ground that it is an unreasonable one. [345C-D]
15. A piece of subordinate legislation does not carry the sfme degree of
immunity which is enjoyed by a stattite passed by a competent legislature.
Subordinate legislatiOn may be questioned on any of grounds on which plenary
legislation is questioned. In addition it may also be questioned on the ground
that it does not conform to the statute under which it is made. It may further
B be questioned on the ground that it is contrary to some other statute. That is
because subordinate legislation must yield to plenary legislation. It may also
be questioned on the ground ~hat it is unreasonable, unreasonable not in the
sense of not being reasonable, but in the sen:;e that it is manifestly arbitrar'y.
, , (345H ; 346A-B] •
16. In India arbitrariness is not a separate ground since it will come ·
· within the embargo or Article 14 of the Constitution. In India any enquiry
c into the vires of dele.gated legislation must be confined to the ground on which
pl~nary legislation may be questioned to the ground that it is contrary to other
statutory provisi6ns or .that it is so arbitrary that it could not be said to be iri
conformity with the statute or that it offends Article 14 of the Constitution.
Subordinate legislation cannot be questioned on the ground of violation of
principles of natural justice on which administrative action may be questioned.
, (347E·G]
D
17. A distinction must ·be made between delegation of a legislative
function in the case of which the _question of reasonableness cannot be enquired
into and the investment by statute to exercise particular discretionary power.
In thC latter case the question may be considered on aU grounds on which
administrative action may be questioned, such as, non-application of mind,
taking irrelevant matters into consideratioa, failure to take relevant· matters
E blto consideration, etc. etc. On the facts and circumstances of a case, a
subordinate legislation m3.y be struck. down as arbitr(!ry or contrary to statute
if it fails to take into account very vital facts lYhiCb-' either expressly or by
necessary implication are required to be taken into consideration by the statute
or. Say, the Constitution. This can only be done on the ground that it does
not conform to the statutory or constitutional requirements or that it offends
F Article. 14 or Article 19 (1) (a) of the Constitution. It cannot. no doubt, be
done merely on the ground that it is not reasonable or that it bas not taken
into account relevant circumstances which the Court considers relevant. [348A-D]
18. In cases Where the power vested in the Government is ~ power which
has got to be exercised in tLe public interest. as· it harpens to be here. the
Court may require the Government to exercise that power in a reasonable way
•
in accordance with. the spirit of the Constitution.. The fact that a notification
G issued under section 25 (I) of the Customs Act, 1962 is required to be laid before
Parliament under section 159 thereof does not make any substantial difference
as regards the jurisdiction of the court to pronounce on its validity. [3.48E-FJ
19. Section 25 of the Customs Act, 1962 under which the notifications
are issued confers a power on the Central Government coupled with a duty to
examine the whole is~uo in· the light of public interest. It provides that if the
Central Government is satisfied that it is necessary in .the public interest so to
lJ
INDIAN EXPRESS v. UNION 295

do it may exempt generally either absolutely or subj~ct to such conditions, A
goods of any description, from the whole or any part of the customs duty levi-
able thereon. The Central Government may if it is satisfied that in the pubHc
interest so to do exempt from the payment of duty by a special order in each
case under circum:;tances of an exceptional nature to be stated in such order
any goods on which duty is lev!able. The power e11:ercisable under section 25
of the Customs Act, 1962 is no doubt discretionary but it is not unrestricted.
l350C-EJ ·B

20. Any notification issued under a statute also being a 'law' as defined
under Article 13(3)(•) of the Constitution is liable to be struck down if it is
contrary of any of the fundamental rights guaranteed under Part III of the
Constitution. [350H ; 35 lA]

.frticle entitled 1ludicial Control of Delegated Legislation : The Test of C
Reasonableness' by Prof. Alan Wharam, 36 Modern La~ Review 61 l at pp. 622
23 ; H.W.R. Wade: Administrative Law (5th Edn.) pp. 747-748; Municipal
Corporation of Delhi v. Bir/a Cotton, Spihning and Weaving Mills, Delhi & .Anr.,
[1968] 3 S.C.R. 251 ; Kruse v. Johnson, [1898] 2 Q.B.D. 91 ; Mixnom Properties
Ltd. v. Chertsey U.D.C. {1964] I Q.11. 214; The Tu/sipur Sugar Co. Ltd. v.
The Notified Area Committee, Tu/sipur, [1980] 2 S.C.R. 1111 ; Ramesh Chandra D
Kachardas Porwal & Ors. v. State qf Maharashtra & Ors. etc., [1981] 2 S.C.R.
866; Bates v. Lmd Hai/sham of St. Marylebone & Ors. (1972] I W.L.R.
1373 and Associated -Provincial Picture Houses Ltd. v. Wednesbury Corporation,
(1948] I K.B. 223, referred to.

Narinder Chand Hem Raj&: Ors. v. Lt. Governor, Administrator, Union
Territory, Himachal Pradesh & Ors., [1972] 1 S.c.R. 940, distinguished. E

State of Madras v. V.G. Rao, [1952] S.C.R. 597 and Breen v. Amalga-
mated Engineering Union, [1971] 2 Q.B. 175, relied upon.

21. If any duty is levied on newsprint by Government it necessarily
• has to be passed on to the purchasers of new<:papers, unless the industry is
able to absorb it. In order to pass on the duty to the consumer the price of F
newspapers has to be increased. Such increase naturally affects the circulation
of newspapers adversely. [352G]

22. The pattern of the law imposing customs-duties and the manner in
which it is opereted, to a certain extent exposes the citizens who are liable to
pay customs duties to the vagaries of executive discretion. While Parliament
has imposed Juties by enacting the Customs Act, 1962 and the Customs Tariff
Act, 1975, the Executive Government is given wide power by section 25 of the
Customs Act, 1962 to grant exemption from the'1evy of Customs Duty, It is
ordinc.rily assumed that while such power to granfexemptions is given to the
Government it will consider all relevant asixcts governing.the-question whether
exemption should be granted or not. In the instant case, in 1975 when the
Customs Tariff Act, 1975 was enacted, 40% ad valorem was levied on news..
print even though it had been exempted from payment of such c:luty. Jf the
exemption had not been continued, newspaper publishers had to pay 40% ad
valortm customs duty on the coming into force of the Customs Tariff Act, H
296 SUPRl!Mll COUllT RBPORts [1985] 2 s.c.R.
1975. ·Tben agaia in 1~82 by the Finance Act, 19g2 an extra levy of Rs. 1000
per tonne was imposed in addition to the original 40% ad valorem duty even'.
though under the exemption notification the basic duty had been fixed at 10%
of the value of the imported newsprint. Neither any material justif}riog the
said additional levy was produced by the Government nor was it made
clear why this futile exercise 'of levying an additional duty of Rs. 1000 per
tonne was done when under -the notification issued· unde~ section 25 of the
B Customs Act, 1962 on March 1, 1981, which was in force then, customs duty
on newsprint above 10% ad valorem had been exempted. While levying tax
on an activity which is protected also by Article 19(1)(a) a greater degree of care
should· be e:ichibJted. While it is indisputable that the newspaper industry
should also bear its due share of the total burden of taxation alongwith the
rest of the community when any tax: is specially imposed on newspaper industry.
it should be capable of being justified as a reasonable levy ia court when its
0 validity is challenged. In the'..absence of sufficient material, the levy of 40%
plus Rs. 1000 per tonne would become vulnerable to attack. [355E-H; 356A-C]

23 .. The reasons given by the Government to justify the total customs
duty of 15% levied from March l, 1981 or total Rs. 825 per tonne as It is
currently being levied appear to be inadequate. In the Finance Minister~s
speech delivered on the floor Of the Lek 'Sabha in 1981, the first reason given
D for the 1evy of 15% duty was th3.t it was intended '·to promote a measure of
restraint in the consumption of imported newsprint and thus help in conserving
foreign exchange." This ground appears to be not tenable for two reasons. Nobody
in Government had~ ever taken into consideration the effect of the import of
newsprint on the foreign exchange reserve. before issuidg the notification levying
15% duty. Secondly, no nawspaper owner can i1nport newsprint directly. News-
print import is Canalised through the State Trading Corporation. If excessive
E import of newsprint adversely affects foteign exchan-ge reserve,~ State Trad·
ing Corporation may reduce the import of newsprint and allocate lesaer quantity
of imported newsprint to newspaper establishmen~s. There is, however, no
need to· impose import duty with a"view to curbing excessive import of news.
print. It is clear that the Govem·mcnt had not considered vitaJ aspects before
•
withdrawing the total exemption which was beiug enjoyed by newspaper industry
F. till March I, 1981 aad imposing 15% duty on.newsprint. (356D-H; 357A·B]

~4. A~tention was particularly drawn to the statement of the Finance
Minister that one of the considerations which prevailed Upon the Government
io levy the.cUstolns dUty was that'', t~e newspapers contained 'piftles'. A 'piffie'
-!',
means foolish -nonsense. It appears that one of the reasons for levying the
duty Was that Ce~tain writings in newspapers appeared. to tlie Mihistcr as 'piffles'.
Such action is not pi;rmissibk Lirider the Constitution. [361H ; 362Al
G
zs. Matters concern-ing the intellect and ethics do undergo fluctuations
from era to era. The wotld of mind is a ·changing one. It is not static. The.
streams of literature aD.d of taste ind judgment in that sphere arc not stagnant.
They have a quality of freshness and vigour. They keep oa changing from time
to time, fr?rri place to plilce and from community to community. [868A)
lND!AN BicPiulss v. UNION

26. It is one thing to say that in view of considerations relevant to
public finance which require every citizen to- contribte a reas6nable amouD.t
A
to public exchequer customs duty is leviabte even on newsprint used by news-
paper industry and an entirely different thing to say that the leVy is imposed
because the newspapers genera11y contain 'piffles·. While the former may be
valid if the circulation of newspapers is not affected prejudicially, the latter
is impermissible under the Constitution as the levy is being made on a consi-
deration which is wholly outside the constitutional limitations. The Govern-
ment c3.nnot arrogate to itself the power to prejudge the nature of cont_ents of
newspapers even before they are printed. Imposition of a restriction of the
above kind virtually amounts to conferring on the Government ·the power to
precensor a newspaper. The above reason given by the Minister to levy the
customs duty is wholly irrelevant. [363B-DJ

27 The argument on behalf of the Government that the effect of the c
impugned levy i ~minimal cannot be accepted. [36SCJ

28. There are factors indicating that the present 1evy is heavy and is
perhaps heavy enough to affect .circulation. There appears to be a good
ground to direct the Central Government to reconsider the matter
afresh. [366C ; DJ
D
Final Report of the International Commssion for the Study of CommuniM
cation Problems, pp. JOO add 141 ; Encyclopaedia Britannica [1962] Vol. 16; p.
339; Second Press Commission Report (Vol. II) pp. 182-183; Bennett Coleman
& Ca. and Ors. v. Union of India and Ors., [1973] 2 S.C.R. 757; Sakal Papers(P)
Ltd. & Or.. v. The Union of India, [1962] 3 S.C.R. 842; William B. Cammarane
v. United Stater of.America, 358 US 498 ; 3 Led 2d 462 ; Jeffery Sole Bigelow
Commonwealth of Virgina, 421 US 809 : L ed 2d600 at 610 and Robert E.
Hannegan v. Esquire, Inc. 327 U.S. 147 : 90 Led. 586, reffered to.

Hamdard Dawakhana (Wakf) Lal Kuan, Delhi & Anr. v. Union of India
& Ors., [1960] 2 S.C.R. 671 ; Lews J. Velentine v.
f.J. Chrestensen, 86 Law
ed. !292 and in re Sea Customs Act, [1964] 3 S.C.R 787, distinguished.

F
Romeah Thapper v. The State of Madras, [1950] S.C.R. 564 ; Hono-
u.able Dr. Paul Borg Olivier & Anr. v. Houourable Dr. Anton Buttigieg, [1%7)
A.C. 115 (P.C.) ; Thomas v. Collins, [1944] 323 U.S. 516 Martin v. City of Stru·
, thers, (1943]319 U.S. 141, followed.

29. The classification of the newspapers into small, medium and big
newspapers for purposes of levying customs duty is not violative of ·Article 14 G'
of the Constitution. The object of exempting small newspapers from the
paymont of cu.ioms duty· and levying 5% ad 'alorem (now Rs. 275 per
MT) on medium newspapers while levyiny full customs duty on big news·
papers is to assist the small and ·medium newspapers, in bringing down their
cost of production. Such papers do not command · large advertisement 're~
venue. Their area.of circulation is limited and majority of them are in
Indian languages catering to rural seclor. There is notbin1 sinister in the Q'

. '!
".') l- ~ " 1-:

298 SUPREMli COURT REPORTS (1985] 2 s.c.a.
object nor can it. be said that the classification has no nexus with the object to
be achieved. [366F-G] ..
Benn£tt Coleman & Co. & Ors. v. Union of India & Ors., [1973]
2 S.C.R. 757, referred to.
30. Quashing of the impugned notification dated March I, 1981, which
had repealed the notification dated July 15, 1977 under which total exemption
B had been granted would not revive the notification dated July 15, 1977.
Once an old rule has been substituted by a new rule, it ceases to exist and
it does" not get revived w.\len the new rule is held invalid. Since the com-
petence of the Central Government to repealer annul or supersede the
notification dated July 15, T977 is not questioned, its revival on the im-
pugned notifications being held to be void would not ari_se and, therefore,
on tho quashing of the impugned notifications the petitioners would have
.c to pay customs duty of 40% ad va/orem'from March l, !981 to February
28, ·1982 and 40% ad va/orem plus Rs. 1,000 per MT from March I,
1982 onwards. In addition to it they would also be liable to pay auxiliary
duty of 30% ad valorem during the fiscal year 1982·83 and auxiliary duty of
50% ad va/orem during the fiscal year 1983·84. They would straightaway be
liable to.pay the whole of customs duty and any other duty levied during the
current fiscal year also. Such a resul_t cannot be a!lowed to ensUe. The
challenge to the validity of the levy prescribeu by the Customs Tariffs Act,
1975 itself cannot be allowed to succeed. [370F-HJ
31. The Government has failed 10 discharge its statutory obligations
While issuing the impugned notifications. The Government is directed to re-
'examine the wbo)e issue after taking into account au relevant considerations
fOr_the period subsequent to March 1, 1981. The Government cannot be
E doprivod of the legitimate dut~ payable on imported newsprint. [37JD.EJ
32. Having regard to the peculiar features of these cases and ArticJe
32 of the Constitution which imposes an obligation on this Court to enforce
the fundamental rights and Article 142 of the Constitution which enables this
Court in the exercise of its jurisdiction· to make such order as is necessary
for doin& complete justice in any cause or matter the followiiig order was
F made : [371F)
I. The Government of India shall reconsider within six months the
entire question of levy of import duty or auxiliary duty payable by the petitioners
and others on newsprint used for printing newspapers, periodicals etc. with effect
from March 1,1981. The petitioners and others who are engaged in newspapers
business shall make available to the Government all information necessary to
G decide the question. [371G-HJ
2. If on such reconsid.:ration the Government decides that th!!re should
be any ·modification in the levy of customs duty_ or auxiliary duty with effect
from March 1,1981, it shall take necessary steps to implement its decision. 372A]
3. Until such redetermination of the liability of the petitioners and
others is made, the Government shall recover only Rs. 550 per MT on
ft. . imported newsprint towar_ds customs duty and auxiliary duty and shall n~t
INDIAN EXPRl's'S v. UNION 299
insist upon payment of duty in accordance with the impugned notificatioos.
The concessions extended to medium aa:d small newspapers may, however, A
remain in force. [372C)
4. If, after such redetermination, it is foun4 that any of the petitioners
is liable to pay any deficit amount by way of duty, such deficit amount shaH be
paid by such petitioner within four months from the date on which a notice of
demand is served on. such petitioner by the concerned authority. Any bank
guarantee or security given by the petitioners shall be available for recovery of B
snch deficit amounts. [3720]
5. If, after such redetermination, it is found that any of the petitioneis
is entitltd to any refund, such refund ·sha11 be made by the Government within
.. four months from the date of such redetetmination.
6. A writ shall issue to the respon<lents. f372F]
c
B.N. Tiwari v. Union of India & Ors., [1965] 2 S.c.R: 421, T. Devadasan
v. Union of India & Anr., [1964] 4 S.C.R, 680 and Firm A.TB. Mehtab
Majid & Co. v. State of Madras & Anr. [1963] Supp. 2 S.C.R, 435 at 446. relied
on.
Mohd.. Shaukat Hussain Khan v. State of Andhra Pradesh, [1975) 1 S.C.R.
4~9, Shri Mulchand Odharji v. Rajkot Borough Municipality, A.I.R. 1970 S.C. D
685, Kote11Mr Vittal Karnath v. K. Rangappa Baliga & Co., (1969] 3 S.C.R. 40
and The case of State of Maharashtra etc. v. The Central Provinces Mangan~
Ore Co. Ltd., [1977] I S.C.R. 1002, distinguis)led.

ORIGINAL JURISDICTION : Writ Petition Nos. 2656-60. 2935·40,
2941-46, '2947-52, 3402, 3467, 3595, 3600-03, 3608, 3632, 3653, 3661,
3821, 3890-93, 4590-93, 4613-15, 5222, 5576, 5600-02, 5726-27, E
7410, 8459-62, 8825, 8944 of 1981, 1325 of 1982, 470·72 of 1984.
T.C. Nos. 23of1983 and 23of1984.
AND
Writ Petitions Nos. 3114·17 of 1981
WITH F
Wrii Petitions Nos. 3393.93 of 1981
WITH
Writ Petitions No. 3853 of 1981
WITH
Writ Petitions Nos. 6446·47 of 1181 G·

(Under Article 32 of the Constitution of India)
A.K. Sen, A.B. Divan, F.S. Nariman, K.K. Venugopal, B.R.
Agarwa/a, Miss Vijay Lakshmi Menon, A.K. Ganguli P.H. Parekh,
C.S. Vaidyanathan, D.N. Mishra, Pravin Kumar, K.R. Nambiar, M.C.
Dhingra, Miss $ieta Vaidya/ingam, P,C. Kapur, Pramod Dayal, CM ff
300 SUPREME COURT REP<JR'l'S (1985] 2 s.C.R.
Nayar, S.S, Munjral, KK. Jain, S.K. Gupta, A.D. Sangar,. Iliinja11
A Mflkherjee, Sudip Sarkar, PX. Ganguli, Miss Indu Malhotra, PR.
Seetharaman and V. Shekhar for the petitioners.
"' K. Parasaran, Attorney General oflndia, Krishna1yer; P.A.
Francis, A. Subba Rao, Da!veer Bhandari and R.N. Poddar for the
respondents .
.B F.S. Nariman, S. K. Dholakia, So/i J. Sorabjee, Anil B.
Divan J.B. Dadachandji S. Sukumaran, D.N. Mishra, K.P. Dhanda-
panf, R.C. Bhatia, P.C, Kapur, A.N. Haksar, O.C. Mathur, Miss
Meera Mathur, Dr. Roxna Swamy, Aruti Jetley, P.H. Parekh, Miss '
Divya Bhalla and Pinaki Misra for the intervener.
c The Judgment of the Court was delivered by
VENKATARAMIAH, J.
I
Pleadings
Tb,e majority . of Petitioners in the.se petitions filed under .
D
Article 32 of the' Constitution are certain companies, their share-·
holders and their employees engaged in the business of editing,
printing and publishing newspapers, periodicals, magazines etc ..
· Some of them are trusts or other kinds of establishments carrying
on the same kind of business. They · consu.me in the. course of their
activity large quantities of newsprint arid it is stated that 60% of .
the' expenditure .involved in the production of a newspaper is
utilised for.buying newsprint, a supstantial 'part of.which is import- .
ed from abroad. They challenge in these petitions the validity of
the imposition of import duty on newsprint imported from abroad
under section 12 of the Customs Act, 1962 (Act 52 of 1962) read
F , with section 2 and Heading· No. 48.01/21 Sub,heading No. (2) in
the First Schedule to the Customs Tariff Act, 1975 (Act 51 of
1975) and the levy of auxiliary duty under the Finance Act, 1981 .
on newsprint as modified by notifications issued under section 25
of the Customs Act, 1962 with effect from March 1, 1981.
G The first set of writ petitions challenjing the above levy was
filed in May, 1981. At that time under the Customs Act, 1962
read with the Customs Tariff Act, 1975, customs duty of 40% ad
valorem was payable on newsprint. Under the Finance Act, 1981
an .auxiliary duty of 30% ad valorem was payable'ill addition to
the customs duty. But by notifications.issued under section 25 of
IJ the attstoms Act, 1962, the customs duty had been reduced to 10%

~ ·' -
iNDiAN EXPRESS v. UNiON (Venkataramiah, J.) 301
ad valorem and auxiliary duty had been reduced to 5% ad valorem
in .the case of newsprint used for printing newspapers, books and A
periodicals.
During the pendency of these petitions while the Customs
Tariff Act, 1975 was amended levying 40% ad va/ortm plus Rs.
1,000 per MT as customs duty on newsprint, the auxiliary duty
payable on all goods subject to customs duty was increased to 50% B
ad Pa!ortm. But by reason of notifications issued under section 25
of the Customs Act, 1962 customs duty at a flat rate of Rs. 550
per MT and auxiliary duty of Rs. 275 per MT are now being levied·
on newsprint i.e. in all Rs. 825 per MT is now being levied.
The petitioners inter a/ia contend that the imposition of the .
import duty has the direct effect of crippling the freedom of speech
and expression guaranteed by the Constitution as it has led to the
increase in the price of.newspapers and the inevitable consequence

- of reduction of their circulation. It is urged by them that with the
growth of population and literacy in the country every newspaper .
is expected to register an automatic growth of at least 5% in its
circulation every year but this growth is directly impeded by the
D,,
increase in the price of newspapers. It is further urged that the
method adopted by the Customs Act, 1962 and the Customs Tariff
Act, 1975 in determining the rate of import duty has exposed the
newspaper publishers to the Executive interference. The petitioners
contend that there was no need to impose customs duty on news· E
print which had enjoyed total exemption from its payment till
March l, 1981, as the foreign exchange position was quite comfor·
table. Under the scheme in force, the State Trading Corporation
of India sells newsprint to small newspapers with a circulation of
iess than 15,000 at a price which does not include any import
duty,to medium newspapers with a circulation between 15,000 and F
50,000 at a price which includes 5% ad valorem duty (now Rs. 27$
per MT) and to big newspapers having a circulation of over 50,000,
at a price which includes the levy of 15% ad valorem duty (now
Rs. 825 per MT). It is stated that the classification of newspapers into
big, medium and small newspapers is irrational as the purchases
G
on high seas are sometimes effected by a publisher owning many
newspapers which may belong to different classes. The petitioners
state that the enormous increase in the price of newsprint subsequent
to March I, 1981 and the inflationary economic conditions which
have led to higher cost of production have made it impossible for
the industry to bear the duty aliy longer. Since the capacity to bear
the duty is an essential element in determining the reasonableness
302 SUPREME COURT REroll'Il! [198!] 2 S.C.R,
o( the levy, it is urged, that th.e continuance. of the levy is violative
A of Article 19{1)(a) and Article 19(J)(g) of the Constitution. It
is suggested that the imposition of the levy on large newspapers by
the Executive is done with a view to stifling circulation ofnews-
papers which are highly critical of the performance of the adminis-
tration. lncideutally the petitioners have contended that the
classification of newspapers into small, medium and big for purposes
B of levy of import duty is violative of. Article 14 of the Constitution.
The petitioners have 'appended to their petitions a number of an-
nexures in support of their pleas.
On behalf of the Union Government a counter-affidavit is •
filed. The deponent of the counter-affidavit is R. S. Sidhu, Under
c Secretary to the Government of India, Ministry of Finance, Depart-
.inent of Revenue, In paragraph S of the counter-affidavit it is
claimed that the Government .had levied the duty in the public • "j'..;.

interest to augment the revenue of the Government. It is stated
that when exemption is given from the customs duty, the Executive \.- f,,,.
has to satisfy itself that there is some other corresponding publfc
.. D j
interest justifying such exemption and that in the absence of any
such public interest, the Executive has no power to exempt and that •
it bas to carry out the mandate of Parliament which has fixed the J;.
rate of duty by the Customs Tariff Act, 1975. It is also claimed
that the classification of newspapers for purposes of granting exemp·
tion is done in the public interest having regard to the relevant
considerations. It is denied that the levy suffers from any mala
..- '• ~
fides. It is pleaded that since every section of the society has to
bear' its due share of the economic burden of the State, levy of ·~
customs duty on newsprint cannot be considered to be violative of '
•
Article 19 (I) (a) of the Constitution. But regarding the pica of '~
the petitioners that the burden of taxation is excessive, the counter-
affidavit states that the said fact is irrelevant to the levy of import !-
dirty on newsprint, In reply to the allegation .of the petitioners ..,..,
that there was.no valid reason for imposing the duty as the foreign
exchange position was quite comfortable, the Union Government '
has stated that the fact that the foreign exchange position was com·
G fortable was no bar to the imposition of import duty. It is further
pleaded that since the duty imposed is an indirect tax which would
be borne by the' purchaser of newspaper, the petitioners cannot feel ' .
·'' aggrieved by it.
II
A Brief History of the levy ·of Customs Duty on Newsprint
ff In order to appreciat~ the various contentions of the parties
·~
"
'
INDiAN EXPRESS v. UNION (Venkataramiah, }.) 303

it is necessary to set out briefly the history of the levy of cumtoms A
duty on newsprint in India.
Even though originally under the Indian Tariff Act, 1934, there
was a levy of customs duty on imported paper, exemption had been
granted for import of white, grey or unglazed newsprint from 'the
levy of any kind of customs duty in qcess of 1.57 per cent ad
B
valorem but subsequently a specific import duty of Rs. 50 per
MT used to be levied on newsprint imports upto 1966. The question
of levy of customs duty on newsprint was examined by the Inquiry
Committee on Small Newspapers. In its Report submitted in
1965 that Committee recommended total exemption of newsprint
from customs duty because in 90% of the countries in the world c
no such levy was being imposed because newspapers played a vital
role in a democracy. On the basis of the· said recommendation,
the Government of l~ia abolished customs duty on newsprint
altogether in the year 1966 in exercise of its power under .section
25 of the Customs Act, 1962. The price of newsprint was
Rs. 725 per MT during the year 1965-66 but there was a Sl.ldden D
spurt in its price in 1966-67 when it rose to Rs. 1155 per MT.
During the period 1966-71 although almost all imported goods
suffered basic regulatory and auxiliary customs duty, there was no
such levy on newsprint in spite of severe foreign exchange crisis
-.'-,_t_
which arose on the devaluation of the Indian Rupee in 1966. But
on account of the financial difficulties which the country bad to face
as a consequence of the Bangladesh war in 1971, a regulatory duty
of 2 1.23 was levied on newsprint imports to meet the difficult
situation by the Finance Act of 19.72. The price of newsprint in
the year 1971-72 was Rs. 1134 per MT. The above 2 1/23 ad
valorem regulatory duty was abolished by the Finance Act o'r 1973, r
and was converted into 5% auxiliary duty by the said Act. This 1
levy of 5% was on all goods including newsprint imported into
India. ·On April 1, i974 under the'~Import Control Order issned
under section 3 of the Imports" and Exports Control Act, 1947,
import of newsprint by private parties~'.was banned and its import
was canalised through the State Trading Corporation of India. In G
1975, the Customs Tariff Act, 1975 came into force. By this Act
the Indian Tariff Act, 1934 was repealed. Under section 2 read
with Heading No. 48.0ll 2lrof the First Schedule to the Customs
Tariff Act, 1975, a levy of basic customs-~duty of 40% ad valorem
was imposed on newsprint._ But in view of the exemption granted
in the year 1966 which remained in force, the imposition made by H
SUPRBMJl COURT Rlll'ORTS [1985] 2 S.C.R.

tlie Customs Tariff Act, 1975 did not come into force. Onfy 5%
A
auxiliary duty which was levied from April I, 1973 continued to be
in operation. In the budget proposals of July, 1977, the 5%
auxiliary duty was reduced to 2 1/2% but it was totally abolished
by a notification issued under section 25 of the Customs Act on
July 15, 1977. The nptification dated July 15, 1977 read as follows :
·o . "NOTIFICATION
CUSTOMS

GSR No. In exercise of the powers conferred by sub-
section (1) of section 25 of the Customs Act, 1962 (52 of 1962)
c and fa. supersession of the notification of the Government
oflndia in the Department of Revenue and Banking No.
'2--Customs dated the 18th June 1977, the Central Govern-
. ment, being satisfied that it is necessary fa the public interest
so to do, hereby exempts newsprint, falling under sub-
heading (2) of Heading No. 48.0l' 21 of the First Schedule
D fo the Customs Tariff Act, 1975 (51 of 19'75), when import-
ed into India, from the whole of that portion of the duty
of customs Ieviable thereon, which is specified in the
said First Schedule.
sd/-
(Joseph Dominic) '··
Under Secretary to the Government of India."
The price ofi newsprint ~during; the year 1975-76 was
Rs. 36\6 per MT .. The total exemption from customs duty imposed
on newsprint was in force till Match I, 1981. In the meanwhile
F
..
the Central Government notified increas·ed salaries and wages to
e'inployees of newspaper establishments, in December, 1980 on the
~ommedations contained in , the Palekar Award. On March I,
l981, the notification dated July 15, 1977 issued under section 25 (1)
of the Customs Act, 1962 granting total exemption from customs
duty was superseded by the issue of a fresh notification which stated
that the Central Government had in the public interest exempted
newsprint imported into India Jor printing of newspapers, books
11nd periodicals from so much of that portion of the duty of customs
leviable thereon as was in excess of 10, per cent ad valorem. The
effect of the said notification was that publishers of newspapers had
. tO pay ten per cent ad valorem customs' duty on imported newsprint.
By another notification issued at about the same· time auxiliary
INDIAN EXPRESS v. UNION (Venkataramiah, J.) 305
.,,,
' duty imposed by the Fiuance Act of 1981 above S per cent A
ad va/orem was exempted in the case of newsprint. The net . result
was that a total duty of 15 per cent ad valorem7came to belimposed
on newsprint for the year 1981-82.
The explanation given by the Government in support of the
above notification was as follows : ·B

"Customs duty on newsprint :

Originally, import of newsprint did not attract any
customs duty. The Government of India abolished the
customs duty on newsprint after the .devaluation of the
rupee on the recommendation of the Inquiry Committee
c
on Small Newspapers (1965). The Committee had men-
tioned in its report that 80% of the newsprint in interna-
tional trade was free from customs duty and had recom-
mended complete abolition of customs duty on newsprint.
However, during the Bangladesh crisis in 1971, a2.l/2% ad D
valorem regulatory duty was imposed on newsprint imports.
Subsequently, this was abolished on April 1,1973 and in its
place a 5% auxiliary customs duty on newsprint imports
,.,_ was proposed in the Union Budget Proposals for 1973-74.
While no customs duty was levied on newsprint because
of the exemption granted by Customs Notification No.
235/F.No.527/1/76-CUS (TU) dated August 2,1976 of the
Department of Revenue and Banking, 5% a~\iary duty
was continued to be levied on imported newsprint till July
15,1977 when the Ministry of Finance, Department of
... Revenue by its Notification No. 148/F.No. Bud (2) Cus/77
dated July 15,1977 exempted newsprint from the whole of F
duty of customs. Prior to this the Ministry of Finance,
Department of Revenue vide its Customs Notification No.
72/F. No. Bud. (2) Cus/77 dated June 18,1977 had reduced
the auxiliary duty to 2.1/2%.
G
In the Budget proposals for the current year, the
Minister of Finance has proposed a customs duty ofl5% on
newsprint imports which has become effective from March
1,1981 because of the Customs Notification No. 24/F. No.
Bud (Cus)/81 dated March 1,1981. This 15% ~toms
(luty co11stitutes 10% basic duty aQd 5% auxiliary duty." H
306 SUPREME COURT REPORTS [1985] 2 S.C.R.
The price of imported newsprint in March 1,1981 was
Rs. 4,560 per MT. The extract from the speech of the
Finance Minister in support of the imposition of a total
15% of dilly (10% basic duty and 53 auxiliary duty) on
newsprint is given below ;

"The levy of 15 per cent customs duty on newsprint
,B
has understandably attracted a good deal of comment
both within the House and outside. As it has been
explained in the Budget speech, this levy is intended to
promote a measure of restraint in the consumption of
. imported newsprint and thus help in conserving foreign
c exchange. In the light of the bbservations made by the
Hon. Members in the course of the General Debate on •
the Budget I had assured the Ho11se that I would try to
work out ar scheme of providing relief to small and medium
newspapers about which Members had voiced their special
concern. We have now worked out the modalities of a
scheme for affording relief to small and medium newspa-
pers •.. Under this Scheme, the. State Trading Corporation
would •sell imported newsprint to small newspapers
at a price which would not I include any amount
. · relatable to imporfduty. Medium newspapers will get .
their newsprint at a price which ;would include an amount
relatable to import duty 'of 5 per·'cent ad va/orem. Big
newspapers would, however, pay a price which will rellect
·the full' duty burden of 15 per ·cent ad valorem. · There is a •
·.definition of small, medium and big newspapers in .the
Press Council. At the moment the present definition is .
F that' these which have a circulation of 15,000 or less are
classilied'as small, those with a circulation of more than
15,000 but less than 50,000 are classified as medium and
those with ''a circulation of over 50,000 are called big
newspapers. Therefore, the small newspapers with a
circulation of 15,000 and less will not pay any customs duty
G those with a circulation between 15,000 and 50,000 will pay
· customs duty of 5 per cent and with a circulation of over >

50,000 will pay 15 per cent. Suitable financial arrange-
·' ments will be worked -0ut as between~ Government and the
State Trading Corporation to enable the STC to give effect
· tb these c6ncessions. 'As Hon. Members are aware, the
If. cat~brisation of newspapers as small, medium and big in
INDiAN EXPRESS v. UNiON (Venkataramiah, J.) 307

terms of circulation is already well understood in the
industry and is being followed by the Ministry of Informa·
tion and Broadcasting for purposes of determining initial
allocation of newsprint and for setting the rates of growth
of consumption of newsprint by various newspapers from
B
year to year. The State Trading Corporation will, for
purposes of the present scheme, follow'.the same categorisa-
tion of newspapers into small, medium and big: These
arrangements will, in effect, provide a relief of about
Rs. 5.86 crores to small and medium newspapers."
•
The relevant provisions of the laws imposing 'customs duty c
and auxiliary duty on newsprint which arise for consideration are
these :

Section 12 of the Customs Act, 1962 reads :

"12. Dutiable goods.-(lj Except as otherwise provided
D
in this Act, or any other law for the time being in force,
duties of customs shall be levied at such rates as may be
specified under the Customs Tariff Act, 1975 (51 of 1975),
or any other law for the time being in force, on ·goods
imported into or exported from India.

•,. (2) ........................................................................ ..

Section 2 of the Customs Tariff Act, 1975 reads :

"2. Duties specified in the Schedules to levied.-The
• rates at which duties of customs shall be levied under the
F
Customs Act, 1962, are specified in the First and Second
Schedules."

The relevant part of Chapter 48 of the First Schedule
'" to the Customs Tariff Act, 1975 which deals with import tariff read
' in 1981 thus : G

"Heading Sub-heading No. Rate of duty Duration .
No. and description Standard Preferenti'al when
of article Areas rates of
..
..;. duty are
protective H
(19$5) 2 S.C.lt;

A
(1) (2) (3) (4) (5)

48.01/21 ...... ................................ ······ ............................. .

B (2) Newsprint containing
mechanical wood pulp
amounting to not Jess
than 70 per cent of
the fibre content 40%
(excluding chrome,
c marble,• flint, poster,
stereo and art paper)
,. ............................................................................"
Newsprint used by the petitioners falls under Sub·heading (2)
of Heading No. 48.01/21 by which 403 ad valorem customs duty
D is levied on it. By ,the Finance Act of 1982 in sub-heading No. (2)
of Heading No. 48.01/21, for the entry in column (3), the entry
"40% plus Rs. 1,000'.per tonne was substituted.

The relevant part of section 44 of the Finance Act, 1982 which
levied an auxiliary duty·of customs read thus:
.E
"44. (1) In the case of goods mentioned in the First
Schedule to the Customs Tariff Act, or in that Schedule, as
· amended from ·time to time, there shall be levied and
collected as an auxiliary'duty of custom~. an amount equal
to thirty per cent of the!value of the goods as determined
F in accordance with the provisions of section 14 of the
Customs Act, 1962 (hereinafter referred to as the Customs
Act).
.......................................................................·······"
The above· rate of auxiliary duty was to be in force during the
G
financial year 1982-83 and ;it was open to the Government to grant
exemption from the ;whole or any part of it under section 25 of the
Customs Act, 1962.

Section 45 of the Finance Act, 1983 imposed fifty per cent of
the value of the goods as auxiliary duty in the place of thirty per
H cent imposed by the Finance Act, 1982.
INDIAN l!KPRms v. UNION (Venkataramiah, J.) 309

But by notifications issued on February 28, 1982 under section A
25 (2) of the Customs Act, 1962, which were issued in supersession
of the notification dated March 1, 1981, Rs. 550 per tonne was
imposed as customs duty on newsprint and auxiliary duty was fixed
at Rs. 275 per \onne. In all Rs. 825 per tonne of newspaper
has to. be paid as duty.. The high sale price of newsprint had by B
that time gone up above Rs. 5,600 per tonne.

What is of significance is that when the Government was of
the view that the total customs duty on newsprint in the public
interest should be not more than 15 per cent and when these writ
petitions questioning even that 15 per cent levy were pending in G
this Court, Parliament was moved by the Government specifically
to increase the basic customs· duty on newsprint by Rs. 1,000
per tonne by the Finance Act, 1982. Hence today if the Executive
Government withdraws the notifications issued under section 25 of
the Customs Act, a total duty of 90 per cent plus Rs. 1000 per
tonne would get clamped on imported newsprint. D

· The effect of the imposition of 15 per cent duty may to some
. extent have l~d to the increase in the price of newspapers in 1981
and it resulted in the fall in circulation of newspapers. On this
point the Second Press Commission has made the following
observations in its Report (Vol. 1 page 18): E

"Fall in circulation duringjl981.

• 94. To examine recent trends in ;circulation and their
relationship to recent trends in the economic environment,
the Commission's office undertook an analysis of the Audit F
Bureau of CircuJations (ABC) certificates !for the period
July 1980 to June 1981. It was found that there was a
decline in circulation in the period January-June 1981
compared to the previous six-month ,period in the case of
dailies and periodicals."
G
The two important events which had taken place during the
' period between July, 1980 to June, 1981 were the enforcement of
the Palekar Award regarding the wages and salaries payable in the
newspaper industry and the imposition of the customs duty of 15%
-',, on the imported newsprint. Under the newsprint policy of \:he
Government there are three sources of supply of newsprint-(i) high 8
1·' ·.: ...

'.l!O [1985] 2 s..c.tt.
seas sales, (iiY sales from the buffer stock built up. by the State
A
Trading Corporation which includes imported newsprint and (iii) •+
newsprint manufactured in India. Imported newsprint is an
important component of the total quantity of newsprint utilised
by any newspaper establishment.
B III

The Importance of Freedom of Press in a Democratic society
and the Role of Courts.
c Out Constitution does not use the expression 'freedom of '
press' in Article 19 but it is declared by .this Court that it is included
in Article 19(l)(a) which guarantees freedom of speech and expres-
sion. (See Brij Bhushan & .for. v. The State of Delhi(') and Bennett
Coleman & Co. & Ors. v. Union of India & Ors.(')
D
The material patt of Article 19 of the Constitution reads :

"19. (1) All citizens shall have the right-
(a) to freedom of speech and expression ;
..•......................................................
I
(g) ·to practise any profession, or to carry on any
• occupation, trade or business,

(2) Nothing in sub-clause (a}ofclause (!)shall alrect
the operation of any existing law, or prevent the State from
F making any Jaw, in so far as such Jaw imposes reasonable
restrictions on the exercise of the right conferred by the
said sub-clause in the interests of the sovereignty and
integrity of India, the security of the State, friendly rela-
tions with foreign States, public order, decency or morality,
or in relation to contempt of court, defamation or incite-
G ment to an offence.
...........................................................................
(6) Nothing in sub-clause (g) of the said clause shall
affect the operation of any existing Jaw in so far as it •
imposes, or prevent the State from making any Jaw impos-

{I) (1950) S.C.R. 605.
(2) [1973] 2 S.C.R. 757

•
lNDiAN llXPl\ESS v. UNION (Penkataramlah, J.) 31 l

ing, in the interests of the general public, reasonabl~ A
restrictions on the exercise of the right conferred by the
said sub-clause ................................................ "

The freedom of press, as one of the members of the Consti-
tuent Assembly said, is one of the items around which the greatest
E
and the bitterest of constitutional struggles have been waged in all
countries where liberal constitutions prevail. The said freedom is
attained at considerable sacrifice and suffering and ultimately it has
come to be incorporated in the various written constitutions. James
Madison when he offered the Bill of Rights to the Congress in
1789 is reported as having said : 'The right of freedom of speech c
is secured, the liberty of the press is expressly declared to be beyond
the reach of this Government'. '(See 1 Annals of Congress ( 1789-
96) p. 141). Even where there are no written constitutions, there are
well established constitutional conventions or judicial pronounce-
ments securing the said freedom for the people. The basic docu-
ments of the United Nations and of some 9ther international bodies
to which reference will be inade hereafter give prominence to the
said right. The leaders of the Indian independence movement
attached special significance to the freedom of speech and expres-
sion which included freedom of press apart from other freedoms.
During their struggle for freedom they were moved by the American
Bill of Rights containing the First Amendment to the Constitution E
of the United States of America which guarnteed the freedom of
the press. Pandit Jawaharlal Nehru in his historic resolution con-
taining the aims and objects of the Constitution to be enacted by
the Constituent Assembly said that the Constitutions. should
guarantee and secure to all the people of India among others F
freedom of thought and expression. He also stated elsewhere that
"I would rather have a completely free press with all the dangers
involved in the wrong use of that freedom than a suppressed or
regnlated press" (See D.R. Mankekar: The Press under Pressure
(1973) p. 25). The Constituent Assembly and its various commit-
tees and sub-committees considered freedom of speech and expres- G
sion which included freedom of press also as a precious right. The
Preamble to the Constitution say(that it is intended to secure to
aU citizens among others liberty of thought, expression, and belief.
It is significant that in the kinds of restrictions that may be imposed
on the freedom of speech and expression any reasonable restriction .
impossible in the public interest is not one enumerated in clause (2)
. ~·

· ·a12 . &UPIUIMll COURT REPQRTS 1· [1985) 2 S.C;R.

of Article 19. ln Romesh Thappar v. The State. of Madras and
4
Brij Bhushan's case (supra) this Court firmly expressed its view <.~
that there could not be any kind of restriction on the freedom of
speech and expression other than those mentioned in Article 19(2)
and thereby made it clear that there could not be any interference
with that freedom in the name of public interest. Even when clause
B (2) of Article 19 was subsequently substituted under the Constitution
(First Amendment) Act, 1951 by a new clause which permitted the
imposition of reasonable restrictions on the freedom of speech and
expression in the interests of sovereignty ·and integrity of India, the
security of the s·tate, friendly relations . with foreign states, public
order, decency or morality in relation to contempt of court, defa·
C.- · mation or incitement to an offence, Parliament did not choose to.
include a clause enabling the imposition of reasonable restrictions
in the public interest.

Article 19 of the Universal Declaration of Human Rights,
1948 declares : "Every one bas the right to freedom of opinion and
D
expression ; this right includes freedom to hold opinions without
interference and to seek, receive and impart information · and ideas
through'·any media and regardless of frontiers".

Article 19 of the International Covenant on Civil and Political
E- Rights, 1966 reads :

"Article 19

1. Everyone shall have the right to hold opininos without
interference.
F
2. Everyone shall have the right ta freedom of expression; .
this right shall include freedom to seek, receive and
impart information and ideas of all kinds, regardless
of frontiers, either orally, in writing or in print, in
the form of art, through any other media of his choice.

3. The exercise of the rights provided for in Paragraph
2 of this Article carries with it special duties and
responsibilities. It may therefore be subject to certain
restrictions, but these shall only be such as are provid·
ed by faw and are necessary :.
tNDiAN EXPRESS v. UNION (flenkalaramiah, I.) 313

(a) Fot respect of the rights or reputations of others;

(b) For the protection of national security or of
public order (order public), or of public health or
morals."
Article 10 of the European Convention on Human Rights
reads :

"Article 10
, 1. Everyone has the right to freedom of expression. This
right shall include freedom to hold opinions and to
receive and impart information and ideas without
c
interference by public authority :md regardless of
frontiers. This Article shall not prevent States from
requiring the licensing of broadcasting, television or
cinema enterprises.
D
2. The exercise of these freedoms, since it carries with
it duties and responsibilities, may be .subject to such
formalities, conditions, restrictions or penalities as are
prescribed by law and are necessary in a democratic ·
society, in the interests of national security, territorial
integrity or public safety, for the prevention of disorder E
or crime, for the protection of health or morals, for
the protection of the reputation or rights of others,
for preventing the disclosure of information received
in confidence, or for maintaining the authority and
· impartiality of the judiciary." F
The First Amendment to the Constitution of the United
States of America declares :

"Amendment I

Congress shall make no law respecting an establishment of G
religion, or prohibiting the free exercise thereof; or abridg-
• ing the freedom of speech or of the press ; or the right of
the people peaceably to assemble, and to petition the
government for a redress of grievances."

Frank C. Newman and Karel Vasak in their article on 'Civil B
314 . SUPkll¥ll COURT Rl!P{)RTS [1985] 2 s.c.R.

A and Political Rights' in the International Dimensions of Human
Rights (Edited by Karel Vasak) Vol. I state at pages 155-156 thus:

"(ii). Freedom of opinion, expression, information and
communication.

B· A pre-eminent human right, insofar as it allows everyone
to have both an intellectual and political activity, freedom
of expression in the broad sense actually includes several
specific rights, all linked together in a "continuum"· maoe
increasingly perceptible by modern technological advance.
What is primarily involved is the classic notion of freedom
c of opinion, that is to say, the right to say what one thinks
and not to be harassed for one's opinions. This is follow-
ed by freedom of expression, in the limited sense of the
term, which includes the right to seek, receive and impart
information and ideas, regardless' of frontiers, either orally,
in writing or in print, in the form of art, or through any
D other media of one's choice. When freedom of expression
is putto use by the mass media, it acquires an additional
dimension and becomes freedom of information. A new
freedom is being recognised which is such as to encompass
the multiform requirements of these various elements,
while incorporating their at once individual and collective
E character, their implications in terms of both "rights" and
"responsibilities" : this is the right to communication, in
connection with which Unesco has. recently undertaken
con!\id.erable work with a view to its further elaboration
and implementation." ...
F.
"Many,Voices, One World" a publication of UNESCO which
contains the Final Report of the International Commission for the
study of Communication · Problems, presided over by Sean Mac
Bride, in part V thereof dealing with 'Communication Tomorrow'
at page 265 emphasizes the importance of freedom of speech and
G pr~ss in the preservation of human rights in the following terms :

"IV. Democratization of Communication.
Human Rights
Freedom of speech, of the press, of information and of
B assembly are vital for the realization of human righ :i
INDIAN EXPRESS v. UNION (Venkataramiah, /.) 315
~ Extension of these communication freedoms to a broader
' >
A
individual and collective right to communicate is an evolv·
ing principle in the democratization process. Among the
human rights to be emphasized are those of equality for
women and between races, Defence of all human rights is
one of the media's most vital tasks, We recommend :
52. All those working in the mass media should contribute 8
to the fulfilment of human rights, both individual and
collective, in the spirit of the Uhesco Declaration on the
'
mass. media and the Helsinki Final Act, and the·Inter·
national Bill of Human Rights. The contribution of the
media in this regard is not only to foster these principles c
but also to expose all infringements, wherever they occur,
and to suppport those whose rights have been neglected
or violated, Professional associations and public opinion
should support journalists subjected to pressure or who
suffer adverse consequences from their dedication to the
defence of human right!;. 0

53. The media should contribute to promoting the just
cause of peoples struggling for freedom and independence
and their right to live in peace i'nd equality without foreign
interference. This is especially important for all oppressed
peoples who, while struggling against colonialism, religious E
and racial discrimination, are deprived of opportunity to
make their voices heard within their own countries.

54. Communication needs in a democratic society should
be met by the extension of specific rights such as the right
to be informed, the right to infrom, the right to privacy,
the right to practicipate in public communication~an
elements of a new concept, the right to communicate. In
developing what might be called a new era of social rights,
we suggest all the implications of the right to communicate
to further explored. G
Removal of Obstacles

Communication, with its immense possibilities for influen-
ajng the minds and behaviour of people, can be a powerful
means of promoting democratization of society and of
widening public participation in the decision•making H
-- ·~·

316 SUPREME COURT REPORTS [1985] 1 s.c.R.

process. This depends on the structures and practices of
the media and their management and to what extent they
facilitate broader access and open the communication
process to a free interchange of .ideas, information and
experience among equals, without dominance of discrimi·
nation."
B
In today's free world freedom of press is the heart of social
and p.olitical intercourse .. The press has now assumed the role of
the public educator making formal and non-formal education •
possible in a large scale particularly in the developing world, where
television' and other kinds of modern communication are not still
G available for all sections of society. The purpose of the press is
to advance the public interest by publishing facts and opinions
witho.ut which a democratic electorate cannot make responsible
judgments. N~wspaper being surveyors of news and views having
a bearing on public administration very often carry material which
would not be palatable to governments and other authoritieli. The
D authors of the articles which are published in newspapers have to
be critical of the action of government in order to expose its weak·
nesses. Such articles tend to · become an irritant or even a threat
to power. Governments naturally take recourse to suppress news-
papers publishing such articles in different ways. Over the years,
E governments in different part& of the world have used diverse
methods to keep press under control. They have followed carrot-
stick methods. Secret payments of money, open monetary grants
and subventions, grants of lands, postal concessions, Government •
advertisements, conferment of titles on editors and proprietors
of newspapers, inclusion of press barons in cabinet and inner
F political councils etc.· constitute one. method of influencing the
press. The other kind of pressure is one of using force against the
press: Enactment of laws providing for precensorship, seizures,
interference with the transit of newspapers and demanding security •
deposit, imposition of restriction on the price of newspapers, on
the number of pages of newspapers and the area that can be devoted
G for advertisements, withholding of Government advertisements,
increase of postal rates, imposition of taxes on newsprint, .canalisa- '
tion of import of newsprint with the ·-object of making it unjustly
costlier etc. are some of the ways in which Governments have tried
to interfere with freedom of press. It .is with a view to checking such
malpractices which interfere with free flow of information, demo·
c;ratic c 0 nstit11tion~ all over the worl\i have made provisions $uara11-
INDIAN EXPRESS v. UNI0;-1 (Venkataramiah, J.) 317

teeing the freedom of speech and expression laying down the limits
of interference with it. It is, therefore, the primary duty of all the A
national courts to uphold the said freedom and invalidate all laws
or administrative actions which interfere with it, contrary to the
constitutional mandate.
Thomas I. Emerson in his article entitled 'Toward a General
B
Theory of the First Amendment' (The Yale Law Journal, Vol.
72,877at p. 906) while dealing with the role of the Judicial institu·
• tions in a democratic society and in particular of the apex court of
U.S.A. in upholding the freedom of speech and expression writes :

"The objection that our judicial institutions lack the
political power and. prestige to perform an active role in
c
protecting freedom of expression against the will of the
majority raises more difficult questions. Certainly judicial
institutions must reflect the traditions, ideals and assump-
tions, and in the end must respond to the needs, claims and
expectiations, of the social order in which they operate. D
They must not, and ultimately can 'not, move too far ahead
or lag too far behind. The problem for. the Supreme
Court is one of finding the proper degree of responsiveness
and leadership, or perhaps better, of short-term and long-
term responsiveness. Yet in seeking out this position the
Court should not under estimate the authority and prestige E
it has achieved over the years. Representing the "con-
science of the community" it has come to possess a very
real power to keep alive and vital the higher· values and
goals towarils which our society imperfectly strives ..........
Given its prestige, it would appear that the power of the F
Court to protect freedom of expression is unlikely to be
• • substantially curtailed unless the whole structure of our
democratic institutions is threatened."
•
What is stated above applies to the Indian courts with equal
G
force. In Ramesh Thappar's case (supra) Brij Bhushan's case (supra),
Express Newspapers (Private) Ltd. & Anr. v. The Union of India &
Ors.,(!) Sakal Papers (P) Ltd. &. Ors. v. The Union of India(') and
Bennett Coleman's case (supra) this Court has very strongly pronoun-

(I) (1959] S C.R. 12.
(2) (1962] 3 S.C.R. 842. H
.., < :-

·-
' .

31S SUPREME COURT REPORTS [1985] 2 s.c.a.

ced in favour of the freedom of press. Of these, we shall refer
A
to some observations made by this Court in some of them.

In Ramesh Thappar's case (supra) this Court said at page 602:
"(The.freedom) ...... lay at the foundation of all demo-
·. cratic organisations, for without free political discussion on
B no public education, .so essential for the proper functioning
of the 11rocesses of popular government, i,s possible. A
freedom <;>f such amplitude might involve risks of abuse
..............,.... "(But) it is better to leave a few of its •
noxious branches to their luxuriant growth, than, by prun-
ing them away, to injure the vigour of those yielding the
c proper fruits"."
In Bennett Coleman's case (supra) A.N.'Ray, C.J. on behalf
of the majority said at page 796 thus :
"The faith of citizen is that political wisdom and virtue
D will sustain themselves in the free market of ideas, so long
as the channels of communication are left open. The
faith in the popular government r~sts on .the old dictum
'let the people have the truth and the freedom to discuss it
and all will go well'. The liberty of the press remains an
'Ask ot the Covenant' in every democracy ....... The
E newspapers give ideas. The .newspaper 1 give the people
the freedom to find out what ideas are correct."
In the very same case, Methew, J, observed at page 818 : •
· "The constitutional guarantee of the ·freedom of speech is
not so much for the benefit of the prejs as it is for the
benefit of the public. The freedom or" speech includes
within its compass the right of all citizens to read and be
informed. In Time v. Hill (385 U.S. 374) the U.S. Supreme
Court said:

G "The constitutional guarantee of freedom of speech
and press are not for the benefit Of the press so much
.as for the benefit of all the people."
In Griswold v. Connecticut (381 U.S. 479, 482) the U.S.
Supreme Court was of the opinion that the right of
freedom of speech and press includes not only the right to
B utter or to print, but the right to reacl."
INDIAN EXPRESS v. UNION (Venkataramiah, !.) 319
Justice Mathew proceeded to observe (at pp. 819·820) :
"Under Art. 41. of the Constitution the State has a duty to
take effective steps to educate the people within limits of
its available economic resources. That includes political
education also.
Public discussion of public issues together with the
• spreading of information and·any opinion. on these issues .
~;

is supposed to be the main function of newspaper. The
highest and lowest in the scale of intelligence resort to its
columns for information. Newspapers is the most potent
means for educating the people as it is read by those who
read nothing else and, in politics, the common ma.n gets c
his education mostly from newspaper.

The affirmative obligation of the Government to
..,, - permit the import of newsprint by expandirtg foreign ex-
change in that behalf is not only because press II.as a
fundamental' right to express itself, but also because the D
community has a right to be supplied with information
and the Government a duty to educate the people within
the limits of its resources. The Government may, under
cl. 3 of the Imports (ControJ) Order, 1955 totally prohibit
the import of newsprint and thus disable any person from
carrying on a business in newsprint, if itis fn the general I
interest of the public not to expend any foreign exchl\]lge •
on .that score. If the affirmative obligation ·to expend
foreign exchange and permit the import of newsprint stems
from the need of the community for information and the
fundamental duty of Government of educate the people f
as also to satisfy the individual need for self exression, it is
not for the proprietor of a. newspaper alone to say that he
will reduce the circulation of the newspaper and increase
' its page level, as the community has an interest in main·
taining or (ncreasing circulation of the newspapers. It is
. said that a propnetor of a newspaper has the fre4)ifom to
cator to the needs of intellectual highbrows who may
' choose to browse.in rich pastures and for that he.would
require more pages for a newspaper and that it would be a
denial of his fundamental right if he were told that he can-
not curtail the circulation and increase the pages. A claim to
enlarge the volume of speech by diminishing the circulation. II:,.

' .
'i~i'
l ' sUPREME COURT llEFoRTS [1985] 2 s.c.11.
' Ji: ' ' -~ : ' ~ - ' - '
raises the pro6Ie\n of reconciling the citizens' right to un-
,,-,, ·, . feti~r~d' exercise of sp'eech in volume' with the community's
ritht to undiminished circulation. Both rights fall within
the ambit of the concept of freedom of speech 8,S explained
.aboVe.''

. . ·The Second .Press Commission has exp!ained the concept j '
.of freedom ot press in its Report !Vol. I pp. 34-35) thus : . 't
..
'--·:-

i"The expression 'freedom of the press' carries different
meanings to different people. Individuals, whether profes-
. sjo11al,J!Jurn~lists o~ not, ·assert their right to address the
public through the medium of the press: Some people
stress . the freedom of the editor to decide what shall be
publis,hed iµ .his paper. Some ?thers emphasizethe riaht
'- r
-··-·
o( t~J'. ,l>Wnqt'S. t() .marJi:et th~ir publjcation. To Justice ..*
Hofmes, ,the l)lain purpose of the freedom was to proy1nt
. all prjor
- ' '
'restraint on' publication.
' ' -
~
.. 16. The theory is that jn a democracy freedom of
· expre~lon.. is indispensable as ,all men are entitled to
partidi.pate' in the proceas of formulation of common i.'
decision!!.· Indeed, freedom of expression is the first condi-
,, tion': of· liberty. It occupies a preferred position in the
hierarchy of liberties gfviiig succour ~and protection to
ofuer Iillerties. 'It has been: truly said that it is the mother
of' all other liberties. The press as a medium of communi-
_cafioil is a modern phenomenon. It has immense power
to advance or thwart the progress of civilization. Its
. freedom can be used to· creaie a brave new world or to
J'.
bring about universal catastrophe.

17. · Freedom of speech presupposes that right con"
clusions are more likely to be pthered · out of a multitude '
of
.··of.tongues than through any kind authoritative. selection.
It rests on the assumption that the widest possible dissemi-
. nation of information: from as many tliverse and antago·
nistic sources as possible is essential to the welfare of the
public. It is the function of the, Press to disseminate
news from as many different sources and with as many .
"·olft'erent facts and colours as possible. A citizen is entirely .,,_
, dependent on the Press for the quality, proportion and
H
''
;~ - ' . ., ~-, ~
.f :': _~. < :~;;~~t1E:~:~
iNDiAN EXPRESS v. UNION (Venkataramiah, J.) 321
extent of his news supply. In such a situation, the exclu·
A
sive and continuous advocacy of one point of view through
the medium of a newspaper which holds a monopolistic
position is . not conducive to the formation of healthy .
public opinion. If the newsp.aper ~i~dustry is co~c~ntrated
·in a few hands, the chance ,.of an idea antagomsttc to the
idea of the ownersJ'getting)ccess to the market becomes B
very remote. .But our constitutional law has been in·
different to the reality and implication~of non-governmental
restraint on· exercise of freedom of speech by citizens. The
indifference becomes critical when comparatively a few
persons are in a position to determine not only the content
of information but also its very availability; The assump- c
tion in a democratic set-up is that the freedom of the press
will produce a sufficiently diverse Press not only to satisfy
"- the public interest by throwing up a broad spectrum of
views but also to fulfil the individual interest by enabling
virtually everyone with a distinctive opinion to find some
place to express it." D

The petitioners have heavily relied upon the decision of this
Court.in Sakai's case (supra) in which the constitutionality of the
--'>. Jilewspaper (Price and Page) Act, 1956 and the Daily Newspaper
(Pdce and Page) Order, 1960 arose for· consideration. The peti·
E
tioner in that petition was a private limited company engaged in
the business inter alia of publishing daily and weekly newspapers
·in Marathi named 'Sakal' from Poona. The nawspaper 'Sakal"
had a net circulation of 52,000 copies on week days and 56,000
copies on Sundays. The daily edition contained six pages a day
.., for five days in a week and four pages on one day. This edition F
was priced at 7 paise. The Sunday edition consisted of teq pages
• and was priced at 12 paise. About 40% of the space in the news·
' paper was taken up by the advertisements and the rest by news,
views and other usual features. The newspaper (price and page)
Act, 1956 regulated the number of pages accordin,g to the price
charged, prescribed the number of supplements to be published G
and prohibited the publication and sale of newspapers in contra-
vention of the Act. It also provided for the regulation of the size
-':-, and area of advertising maUer contained in a newspaper. Penal-
ties were prescribed for contravention of that Act or the Order
made thereunder. As a result of the enforcement of that Act
in order to publish 34 pages on six' days in a week as it was doin~
H
-'i' - :; '

'f

322 SUPRllMB COURT Rl!l'Oll'fS [1985] 2 s.c.11.
then; the petitioner had to raise the price from 7 paise • to · S paise~ •.
per day and· if it did not wish to increase the price, it had to
reduce the total number of pages to 24, The petitioner which
could, publish any number of supplements as and when it desired
to do so before the Order impugned in that case was passed could
do so thereafter only with permission of the Government. The )j ·
B contention of the petitioner in that case was that the impugne<t'
Act and the impugned Order were pieces of legislation designed
to curtail the circulation of the newspaper as the increase in the "
price of the paper would adversely affect its circulation . and they
directly interfered with the freedom of the press. The validity-
of these pieces of 1egislation was challenged on the ground that
c they violated Article 19 (1) (a) of the Constitution. The Union · ,,.
Government contested the petition. It pleaded that the impug- .. '!"
ned Act 'and the Order had been passed with a view to preventing.,} ·I
unfair competition among newspapers and also · with a view to"
preventing 'the rise of monop'o!istic combines so that newspapers
D might have fair opportunities of free'discussion. It was also con-
tended that the illl,Pugned Act and the impugned Order had bceri
passed in the public interest and the petitioner's business being a ·"· -~
trading activity falling under Article 19 (1) (g) of the Consti-
tution ariy restri~tion imposed by the said :Ac~ and th~ Order "'a.f )-
protected by Article 19 (6). of the Constitution. This Court ne- · . ~'<
E gativing the contention of the Union Government ob$erved at \1
page 866 thus : . ••,.
f
"Its object thus is to regulate something which, as •. \)

already stated, is directly related to the circulation of a
newspaper. Since circulation of a newspaper is :a part of
F the right. of freedom 9f speech the Act must be regarded as
one directed against the freedom of speech,: It has
selected the fact or thing which is an essential and basic \.. ,'
attribute of the conc~ption of the freedom of speech viz.
the right to circulate one's views to all whom one can·
G reach or ca_re to reach for the imposition of a restriction.
It seeks to achieve its object of enabling what are termed ' ' '

the smaller newsP,apers to secure larger circulation by pro-
visions which without disguise are aimed at restricting
th~ circulation of what are termed the larger papers with-
better financial strength. The impugrled. law for fro'm
being one, Which merely interferes- with the riaht of fr~
dom of speech incid~ntally, does so directly ·though it
/·
"" .·
~~~··i~
..
..,,,

INDIAN EXPRESS v. UNION (Venkataramiah,J.) 323
seeks to achieve the end by purporting to regulate the A
business aspect of . a newspaper. Such a course is not
permissible and the courts must be ever vigilant in guard-
ing perhaps the most precious of all the freedoms
guaranteed by our Constitution. The reason for this is
obvious. The freedom of speech and expression of
opinion is of paramount importance under· a democratic B
Constitutio.n which .envisages changes in the composition
of legislatures and governments and must be preserved.
No doubt, the · law in question was made upon the
' . recommendation of the Press Commission but since its
•
object is to affect directly the right of circulation of news-
papers which would necessarily undermine their power c
to. influence public opinion ·it cannot stat be regarded as
a dangerous weapon which is capable of being used against
democracy itself." •

Continuing further the Court observed at pages 867 and D
868 thus:

"It was argued that the object of the Act was· to pre-
vent monopolies and that monopolies are obnoxious. We
will assume that monopolies are always against public
interest and deserve to be suppressed. Even so, upon E
the view we have taken that the intendment. of the Act
'• , and the direct and immediate effect of the Act taken
along with the impugned order was to interfere with the
freedom of circulation of newspapers the circumstance
that its object was to suppress monopolies. and prevent
unfair practices is of no assistance. F

The legitimacy of the result intended to be achieved
l
.• does not necessarily imply that every means to achieve it
• is permissible for even if the end is desirable and per-
missible, the means employed must not transgres& the
G
limits laid down by the Constitution, if they directly
i~pinge on any of the fundamental rights guaranteed
' by the Constitution it is no answer when the constitu-
tionality of the measure is challenged that apart from
the fundamental right infringdd the provision is otherwise
legat.''
H
,.,
324 sul'J.EMB COIJR'l' !UlPOllTS [198S] 2 S.C.ll.
: ~,
We have so far seen the importance of the freedom of speech
· ,' ' and expression which includes the freedom of press. We shaU..-k
A· now proceed to consider whether it is open· to the Government to
levy any tax on any of the aspects of the press industry.

IV
Do newspapers have immunity from taxation ? "
'I' '
B
Leaving aside small newspaper establishments whose circu·
lation may .be less than about 10,000 copies a day, all other •
.bigger. newspaper establishments have the characteristics of a·
large industry. Such bigger newspaper concerns are mostly sitna·
ted in urban areas occupying large buildings which · have to be
c provided with all the services rendered by municipal authorities; • , !~
They employ hundreds of employe91. Capital investment in
many of them is in the order of millions of rupees. Large· quan· :.,i.
tities of printing machinery are utilised by them, a la~ge part of
which is imported from abroad. They have to be provided .with
telephones, ·teleprinters, postal and telegraphic se,rvices, wireless
D communication systems etc. Their newspapers have to, be trans··
ported,- by roads, railways and .. air "services. Arrangements for
security of their property have to be made. The Government has
to provide many other services to them. All these result in a big,
drain on the financial resources of the State as many of these ~
services are heavily subsidized. Naturally such big newspaper
E
organisations have to contribute their due share to the public ·\·{I
exchequer. They have to bear the common fiscal burden like
•
all others. '

While exammmg the constitutionality of a ·Jaw which is
F aileged to contravene Article 19 (I) (a) of the Constitution, we 4' · ~·
cannot, no doubt, be solely guided· by the decision& of the Supreme ~ .!
Court of the United States of, America. But iq order to
understand the basic principles of freedom of speech and ex·
pression and the need for that freedom in a democratic country,
we may, take ·them into consideration. The pattern of Arti.cle
19 (I) (a) and of Article 19 {l}(g) of our constitution is different •
from the pattern of the First Amendment to the American Consti·
tution which is almost absolute in. its terms. The rights guaran·
teed under Article 19 (1) (a) and Articie 19 {l) (g) of the Consti-
ff tution are to be read along with clauses (2) and (6) of Article 19
INDIAN EXPRESS v. UNION (V~kataramiah, J.) 325
which carve out areas in respeci of which valid legislation can be
made. It may be noticed that the newspaper industry iias not been A
granted exemption from taxation in express terms. On the other
band Entry 92 of List I of the Seventh Schedule to the Consti-
tution empowers Parliament to make laws levying taxes on sale or
purchase of newspapers , and on advertisements published
therein. B
It is relevant to refer here to a few extracts from the speech "
of Sbri Desbbandbu Gupta on the floor of the ,Constituent
Assembly opposing the provisions in the Draft Constitution which
auth~rised the State Legislatures to levy sales, tax on sale of news-
papers and tax on advertisements in newspapers. He uid : c
" ............... No one would be happier than myself
and my friends belonging to the press, if the House were, to
decide today that newspapers will be free from all such
taxes. Of course that is what it should be because in no
free country with a democratic Government ,we have any D
such taxes as the sales tax or the advertisement tax .........
... ........ , ................. ,1 claim that newspapers do deserve
a distinctive treatment. They are not an industry in the
sense that other industries are. This has been recogni-
sed all over the world. They have a mission to perform.
And I am glad to say that the newspapers in India have E
performed that mission of public service very 'Creditably
and we have reason to feel proud of it. I would1 there·
, I fore, expect this House and my friend Mr. Sidhva to bear
it in mind at the time when God forbid any proposal
comes before the Parliament for taxation. That would
F
be the time for them to oppose it.

Sit, after, all, this is an enabling clause. It does not
say that there shall be sales and advert!sement tax imposed
on newspapers. It does not commit the House tpday to
the impositon of a tax on the sales of or a, tax 011 adver- G
tisements published in newspapers, All that we have
emphasised is that newspapers as such should be taken away
from the purview of the,, provincial Governments and
brought to the Central List so that if at all ,at, any time
a tax is to be imposed on newspapers it shquld be done
by the representatives of whole country realising the full ,,,
'. ,-•.

(1985] :h.c,ll'~
implications of their action. It saould not be an .isolated ·
act on the part of some Ministry of some province. That
wa~ the fundamental basis of our amendment ............. ..
.................. ; ...................................If today all news-
\ ,J,,·
papers including those published from Delhi are opposing '• t
> ;'-\
the imposition of these taxes with one voice and deman-
i" ·.·1'
.
ding their inclusion in the Central· List, they do so, not
because it is a question of saving some money, bnt be-
cause the fundamental question of the liberty of the press
is involved. By advocating their transfer to the Central
Liilt we are prepared to run the risk of having these taxes
,,
imposed in Delhi, and in other provinces which have not
sought to imposi such taxes ·so far. But we do not want
to leave it to the Provinces so that the liberty of the press
remains unimpaired. We have faith in the Parliament :
.we have faith in. the collective wisdom of the country
·and we have no doubt. that when this matter is viewed in
the correct perspective, there will be no such taxes im-
D posed on the newspapers, but we have not got that much
faith in.the Provincial Miniskies. It is in that hope and
having a full realisation of the situation that we have
agr~d, as a matter of compromise, or should I say as a
lesser evil, to have these two taxes transferred from the
Pro'l!incial to the Central . List,'" (Vide Constituent
. AS1embly Debates Vol. IX, pp. 1175-1180 'dated
· Se'ptember 9, 1949).

Ultimately the power to levy taxes on the sale or purchase •i
I
of newspapers and on advertisement published , therein was I
conferred oil Parliament by Entry 92 of List I of the Seventh
Schedule to the Constitution. .This' shows the anxiety on the part
of the framers of our Constitution to protect the newspapers
against local pressures. But they; however, did not agree to
provide any i::onstifutimial immunity against such taxation. The
power to levy customs duties on goods imported into the country
is also entrusted to , Parliament by Entry 83 in List I of, the
Seventh Sched.ule to the Constitution.
•
On the power of t e Government ill the United States of
America to levy taxes on and to prov.ide for the licensing of news-
papers, Corpus Juris Sequndum (Vol. 16) says at page 113~ as
follows: ·
iNDiAN JiXP1ll!SS v.•tJNiON (Venkataramiah, J.) 327 ·
"213. (13), Taxing and Licensing
A
"The Constitutional guaranties of freedom of speech
and of the press are subject to the proper exercise of
the government's power of taxation, and reasonable license
fees may b• imposed on trades or occupations concerned
with the dissemination of literature or ideas . B -
. " • As a general rule, the constitutional guaranties of
freedom of speech and of the· press are subject to the
proper exercise of the government's power of taxation, so
• that the imposition of uniform and non-discriminatory
taxes is not invalid as applied to persons or organisations c
engaged in the dissemination of ideas through the J'Ublica-
tion or distribution of writing. The guaranty of freedom
of the press does not forbid the taxation of money or
property employed in the publishing business, or the
imposition of reasonable licenses and license fees on trades
or occupations concerned with the dissemination of litera- D
ture or ideas.

A license or license tax to permit the enjoyment of
freedom of speech and freedom of press may not, however,
be required as a form of censorship, and where the purpose
of the tax or license is not for revenue, or for reasonable E
regulation, but is a deliberate and calculated device to
prevent, or to curtail the opportunity for, the· acquisition
of knowledge by the people in respect of their governmental
affairs, the statute or .ordinance violates the constitutional
guaranties, and particularly the Fourteenth Amendment
to the federal Constitution. While an ordinance imposing
a tax on, and requiring a license for, the privilege of adver-
tising by distributing books, circnlars, or pamphlets has
been held valid_, an ordinance requiring the payment
of a license tax by street vendors or p:dd]ers is invalid
as applied to members of a. religious group distributing
G
religious literature as part of their activities, at least where
the fee is not merely a nominal one imposed to defray
the cost of regulation, notwithstanding the ordinance is
non.discriminatory. A governmental regulation requiring
a license ito solicit, for ~ompensation, memberships in
organizations requiring the payment of dues is invalid,
H

··-'·
. '','

328 SUPREMB'COURT·ll!PORTS (1985] l s.c.ll
., where it fixes indefinite standa_rds for the granting of a
A license to an applicant. A provision of a retail sales tax
act providing that· a retailer shall not advertise as to the
non-collection of sales tax from purchasers does not deprive
retailers of the constitutional right of free speech."
The above subject is summarised in American Jurispl'.lldence
B 2d (Vol. 16) at page 662 thus :

"Speech can be effectively limited by the exercise of
• that taxing power. Where the constitiltionalright to speak is
sought to be deterred by a state's general taxing program; •
due ·process demands that the speech be unencumber.ed
c : until the state comes forward with sufficient proof to justify
·.. its inhibition. But constitutional guaranties are not
violated by a statute the contr,Ollihg purpose of which is to
raise revenue to help defray the current expenses· of state
government and state obligations,· and which· shows no
hostility to the press nor exhibits any purpose or design to
-D restrain the press."

It may be mentioned here that the First Amendment to the
·Constitution of the United States of America is almost in absolute
terms. ·It says that the Congress ·sl'iall make no I:iw abridging the
freedom of the press. Yet the American Courts have recognised
E the power of the State to levy taxes on newspaper establish-
ments, of course, subject to judicial review by courts by the applica-
tion of the due process of law principle. ''Due process of law
does not forbid all social control; but it protects personal liberty •
against social control, unless such social contr61 is reasonable
either because of a constitutional exercise of the police power, or of
F the powet offaxation or of the power of eminent domain". If any
legislation delimiting personal liberty is held to be outside of all
three of these categories, it is taking away of personal liberty without
due process of law and is unconstitutionai. The police power,
taxation and eminent domain are all forms of social control which
.G are essential for peace, and good government. 'The police power
is the legal capacity of the severeignty or one of its governmental •
. agents; to· delimit i_the personal liberty of persons by means which
bear a substantial relation to the end to be accomplished for the
protection of social interests which ~easonably need protection.
81 Taxation is the legal capacity 6f sovereignty or one of its govern·
• -','> •

.-. ..
'.,._,. · -~~:-_;-~i :'.- ~~--L ,,
"iNDiAN ExPRllSS v. UNION (Venkataramiah, !.) 329
mental agents to exact or· impose a charge upon persons or their
prope~ty for the support of the government and for the payment
for any other Public purposes which it may constitutionally carry out.
Eminent domain is the legal capacity of sovereignty or one of its ·
governmental agents, to take private property for public use upon
the payment of just compensation.' It is under the above said
sovereign power of taxation the government is able to levy taxes on
the publishers of newspapers too, subject to judicial review by courts ·1,,
notwithstanding the language of the First Amendment which is
absolute in terms. In India too the power to levy tax even on
persons carrying on the business· of publishing newspapers has got
to be recongnised as it i~ inherent in the very concept of gove~nment.
But the exercise of such power should, however, be subject to · ;
scrutiny by courts. Entry 92 of List I of the Seventh Schedule to
the Constitution expressly suggests the existence of such power. ·

Thomas I. Emerson in his article on the First Amendment
(The Yale Law Journal, Vol. 72 at p. 941, has made certain relevaD,t
observations on the power of the State to impose taxes an.d economic
regulations on newspaper industry. He says ; ·

"(a) Taxation and Economic·Regulation.

Regular tax measures, economic Tegulations, social
welfare legislation and similar provisions may, of course,
have some effect upon freedom of expression when applied
to persons or organizations engaged in various forms of
communication. But where the burden is the same as that
borne by others engaged in different forms of activity, the
similar impact on expression seems clearly insufficient to
constitute an · "abridging" of freedom of experession.
Hence a general corporate tax, wage and hour or collective
bargaining legislation, factory laws and the like are as .
applicable to a corporation engaged in newspaper publishing '
as to other business organisations. On the other hand, the
use of such measures as a sanction to diminish the volume of
expression or control its content would Clearly be aY imper-
missible an "abridgment" as direct criminal prohibitions.·
The line may sometimes 1'e difficult to draw, the more so
as the scope af the regulation is narrowed.

Two principles for delineating the bounds of "abridg·
·.\.'
\'

BUPll.EME COURT REPORTS. , · .[1985J 2 s.c.R,
• ing'.' may b.e statQCI. ,First, as a general proposition the'vali-
dity of the measure lll'Y be tested bY .the ru)e that it must
· be equally applicable to a substantially larger .. group than
that engaged in expression. Thus a special tax on the press
alone, or a tax exemption available only to those with
...
'
particular · political views or associations, would not be
'

. permitted. Second, neither' the substantiPe nor procedural
... ·... provisions of the measure, even though framed in gene/fa/
t terms, may place any substantial burden on expression because
of their peculiar impact in that .area. Thus the enforcement
. of a tax or corporate registration statute by requiring
'
disclosure of membership in an association.. where such
<!isclosure would substantially impair freedom of expression, '
sl;tould be found to violate first amendment protection."
(Underlining by us).

" . This view appears to ·have been accepted by our Secon<I Press
C<lmmission in its Report (Vol. I) at page 35. The Commission
, ! , ' \
.. oJ1roi:ves :
·~ - ~''·'
•,

;• . "21. Economib and tax measures, legislation. relating
to social welfare and wages, factory laws, etc., may have
some effect 'upon freedom' of the Press when applied to
persons or institutions engaged in various forms . of
communication. But where th! burden placed on them is
the same as that .borne by other engaged in different forms
of activity, it does not constitute abridgment of freedom
' of the Press. The use of such measures, however, to oontrol '
the 'content' of expression would be clearly impermissible." •
. I~ Alice Lee Grosjean, Supervisor of Public Accounts for the !I
1
,C .-State of. Louiiiana v. American Press CompanY( ) in which the .,. ,.
·'.-
' ;iippellants had questioned the constitutiqnal validity of an Act of
i
' J;oi!i.$iana' which required every person engaged in the business of ~

' selling or making, any charge for, advertising or for advertisements, •
' printed or published in any newspaper, periodical etc.· having a
. mrculatio.n of more than 20,000 copies per week to pay, in addition
' 'to at.I other ·taxes, a· Iicen.se tax for privilege of engaging in such
I .busin~lis ln the Sta~e of Louisiana of two per cent (2%) of the gross
:.;r~ts of81lch business, the Supreme Coui:t of the. United States
; oblerved at pages 668-669 :
:, . (l) 297 U.S. 233 : 80 L. ed. 660.

.:-~. ·'
INDIAN EXPRliSS v. UNION (Venktitaramiah, J.) 331
"In the light of all that has now been said, it is evident
that the restricted rules of the English law in respect of the
freedom of tbe press in force when the Constitution was
adopted werenever accepted by the American colonists; and
that by the First Amendment it was meant to preclude the
national government, an!l by the Fourteenth Amendment
to preclude the states, from adopting any form of previous
restraint upon printed publications, or their circulation,
including that which hacl theretofore been effected by
• these two well known and odious methods ..................... .

· It is not intended by anything we have said to suggest
that the owners of newspapers are immune from any of the
ordinary forms Qf taxation for suppprt of the government.
--( .. But this is not an ordinary form of tax, but one single in
kind, with a long history of hostile misuse against the
freedom of the press.

The predominant .purpose of the grant of immunity
here invoked was to preserve an untrammelled press as a
vital source of public information. The newspapers,
.-'\.. ' ina&azines and other journals of the country, it is safe to
say,. have shed and continue to shed, more light on the
public and business affairs of the nation than any other J
instrumentality of publicity; and since informed public
opinion is the most potent of all restraints upon misgovern-
. ment, the suppression or abridgment of the publicity
afforded by a free press cannot be regarded otherwise than
with grave concern. The tax here involved is bad not
because it takes money from the pockets of the appeilees. I
If that were all, a wholly different question would be
• presented. It is bad because, in the light of its history and
of its present setting, u is seen to be a deliberate and calcula-
ted device in the guise of a tax to limit the circulation of .·
information to which the public is entitled in virtue of the
constitutional guaranties. A free press ··stands as one· of
the great interpreters between the government and the
people. To allow it to be fettered is to fetter ourselves."
(Underlining by us)
'
The ·levy imposed by Louisiana was quashed by the. Sap;eme f,

:- ~
,,-: --~}i.~~·i::
;:(:

'~-

'3,32 SUPREME COURT llBPORTS (1985] 2 s.c.il.
\
· Con.rt· of the United States of America in the above case on the
gt'Qund that it violated the First Amendment to the Constitution of
,tho' United States of America sine~ it was of the view that the tax
. ' 'tevied in this ease was a device :to limit the circulation of informa-
tion. tile eo'urt, however, did n~t say that no tax could be levied
'' on.the press in any event.
' 'f'~·.··
·In Robert Murdock, Jr. v. Commonwealth of Pennsylvania
····'(City of Jeannette)(1l the Supreme Court of the United States of
.,,:, ' America declared, as unconstitutional and violative of the First •
··.Amendment to the Constitution of the United States of America
·\which guaranteed freedom of spe,ech and expression, an ordinance
"- which imposed. a licence tax on persons canvassing for and soliciting
within the city of Jeannette orders for goods, paintings, pictures,
wares or merchandise of any kind or persons delivering such articles
. under .orders so obtained or solicited. The .·petitioners in that case ,
were 'Jehovah's witnesses' who went about from door to door in
the city of Jeannette distributing literature and soliciting people to
' . pµrchase certain religious books and pamphlets. None of them
obtained a licence· by paying the prescribed fee and they were
'' . convicted for violating the Ordinance by the Superior Court of - ';•,

·Pennsylvania. The Supreme Court of the United States of America
quashed the conviction holding that the Ordinance violated the
,f· First Amendment Douglas, J. who wrote the majority opinion
· ol)served at pages 1299 and 1300 thus:
"In 111l of these cases the issuance of the permit or
· license is dependent on the payment of a license tax. And
the license t(lx isfi)Ced in amount and unrelated to the scope
of the activities ofpetitioners or to their realized revenues.
It is not a nominal fee imposed as a r~gulatory measure ,to
defray the expenses of policing the activities in question'.
It is in no way apportioned. It i.s a flal'license tax levied
and collected as a condition to the pursuit of activities
whose enjoyment is guaranteed by the First Amendment.
Accordingly, it restrains in advance those constitutional
liberties of press and religion and inevitably tends to
suppress their exercise. That is almost uniformly recog-
nised as the inherent vice and evil of this flat license
tax ............ . ...... •'.
f . • ,i
'(1} 319'u.s. 105 : 87 Law. ed. 1292.
,--;:-· .. •
'

INDIAN EXPRESS v. UNION (Venkataramiah, J.) 333

The fact that the ordinance is "nondiscriminatory" A
is immaterial. The protection afforded by the First
Amendment is not so restricted. A license tax certainly
does not acquire constitutional validity because it classifies
the privileges protected by the First Amendment along
with the wares and merchandise of hucksters and peddlers
and treats them all alike. Such equality in treatment does B
not save the ordinance. Freedom of press, freedom Qf
speech, freedom of religion are in a preferred position,"
(Underlining by us).

Justice Reed who dissented from the majority observed at page
1306 thus:
c
"It will be observed that there is no suggestion offreedom
from taxation, and this statement is equally true of the other
State constitutional provisions. It may be concluded that
neither in the state or the federal constitutions was general
D
taxation of church or press interdicted.

Is there anythiag in the dt1i1iens of this Court which
indicates that church or press is free from the financial
burdens of government ? We find nothing.. Religious
societies depend for their exemptions from taxation upon E
state constitutions or general statutes, not upon the Federal
Constitution. Gibbons v. District of Columbia, 116 US
404, 29 L ed 680, 6 S. Ct 427. This Court has held that the
chief purpose of the free press guarantee was to prevent
previous restraints upon publication. Near v. Minuesota
283 US 697, 713, 75 L ed 1357, 1366, 51 S Ct 625. F
In Grosjean v. American Press Co., 297 US 233, 250, 80
L ed 660, 668, 56 S Ct 444; it was said ·that the predo-
minant purpose was to preserve "an untrammelled press
as a vital source of public information." In that case, a
gross receipts tax on advertisements in papers with a
.. circulation of more than twenty thousand copies per week
was held invalid because a deliberate and calculated device
G

m . of a t ax to 1·1m1t
. th e guise ..the circulat1on
. . ................... "

There was this further ~omment :
I •

"It is not intended by anything we have said to suggest
u
.\-f' -_\ :~:~ ·w~x;:=~~:"r~*·~i.~~~i~~ >,~~~
....
( '.~

334 SUPREME CO!IR'I: REPORTS [19S5J 2 s.c,1.

'A that the owners of newspapers are immune from any of the
ordinary forms of taxation for support of the government.
But this is not an · ordinary form of tax, but one single in
kind, with a long history of hostile misuse against the
freedom of the press." Id, 297 US 250, 80 L ed 668. 56
S Ct.444.
It may be said, however, that ours is a too narrow,
technical and legalistic approach to the problem of state
·taxation of the activities of church and press; that we
should look not to the expressed or historical meaning of • '·
· the First Amendment but to the broad principles of free
speech and free exercise of religion· which pervade our.
national way of life. It may be that the Fourteenth
Amendment guarantees these principles rather than the ..
, more definite concept expressed in the First Amendment
This would mean that as a Court, we should determine
what sort ofliberty it is that the due process.clause of the
Fourteenth Amendment guarantees against state restrictions
D
on speech and church ......... ,

Nor do we understand that the Court now main·
tains that t):te ·Federal Conatitution frees press or religion
of any tax except such occupational taxes as tl:uise here
E levied. Income taxes, ad valorem taxes, even occupational
taxes are presumably valid, save only a license tax on sales
of religious books, Can it be that the Constitution permits
a tax on the pfinting presses and the gross income Of a •
metropolitan newspaper but denies the right to lay an
occupational tax on the distributors of the same papers 7
f Does the exemption apply to book sellers or distributors
of magazines or only to religious publications ? And, if , .
th.e Jatter, to what distribµtors 7 Or to. what books?
Or is this Court saying that a religious practice of book
distribution is free from taxation because a state cannot
G
a
prohibit the "freee exercise thereof" and newspaper is
subject to the same tax even though the'\ame Constitu·
tional Amendment says the state cannot abridge the
freedom of the press ? It. has never been thought before
that .freedom from taxation was a perquisite attaching to
the privileges of the First Amendment,"

/.1 8 Justi<;e Reed all\!ed at pa$es B07 an\! 13(>8 th11s :
INDIAN EXPPRESS v. UNION (Venkataramiah, J.) 335

"It is urged that such a tax as this may be used A
readily to restrict the dissemination of ideas, This must be
conceded but the possibility of misuse does not make a tax
unconstitutional. No abuse is claimed here. The ordina-
nces in some of these cases are the general occupation
license type covering many businesses. In the Jeannette
prosecutions, the ordinance involved lays the usual tax on B
canvassing or soliciting sales of goods, wares and merchan-
dise. It was passed in 1898. Every power of taxation
• or regulation is capable of abuse. Each one, to some
extent, prohibits the free exercise of religion and abridges
the freedom of the press, but that is hardly a reason for
denying the power. I/ the tax is used oppressively the law c
• will protect the victims of such action." (Underlining
by us.)
Justice Frankfurter who also dissented from the majority
observed at pages 1310 and 1311 thus :
D
"It cannot be said that the petitioners are constitu-
tionally exempt from taxation merely , because they may
be engaged in religious activities ot because such activi-
ties may constitute an exercise of a constitutional
right, .........
E
Nor can a tax be invalidated merely because it falls
upon activities which constitute an exercise of a_ consti-
tutional right. The First Amendment of course protects
the right to publish ~ newspaper or a magazine or a
book. But the crucial question is-how much protection
does the Amendment give, and against what is the right F
protected ? It is certainly true that the protection
afforded the freedom of the press by the First Amend-
ment does not include exemption from all taxation. A
tax upon newspaper publishing is not invalid simply
because it falls upon the exeacise of a c9nstitutional
right. Such a tax might be invalid if it invidiously singled G
out newspapers publishing for bearing the burdens of taxation
or imposed upon them in such ways as to enc~oach on the
essential scop~ of a free press. Tf the Court could justi-
fiably hold that the tax measures in these cases were Vulner-
able on that ground, I would unreservedly agree, But the
H
336 SUPRBME COUllT REPORTS [1985] 2 s.c.R.

Court lias not done so, and indeed could not," (Under-
lining by us)

In the above case it may be noticed that Douglas, J. who
"i
gave the majority opinion did not say that no tax could be levied
at all on a press, but he did not approve of a uniform license
B tax unrelated to the scope of the activities of the persons
who had to beat it. The dissenting opinions have- clearly &lated
that the press does not enjoy any immunity from taxation. They,
however,-say that the taxation. should not encroach upon the •
essential scope of a free press.

c We may usefully refer here to a passage in the foot note
given below the Essay No 84 by Alexacder Hemilton in 'The •
Federalist'. it reads :

"It cannot certainly be pretended that any degree
of duties, however low, would be an abridgment of the
liberty of the press. We know that newspapers are taxed
in Great Britain, and yet it is notorious that the press
nowhere enjoys greater liberty than in that country. And if
duties of any kind may be laid without a violation of
of that liberty, it is evident that the extent must depend ' )-
on legislative discretion, regulated by public opinion ;"
E )'.

At this stage we find it useful to refer to a decision of the
Privy Council in Attorney General & Anr. v. Antigua Times Ltd.(1)
Where the Judicial Committee of the Privy Council was called upon
to decide about the validity of the imposition of a licence fee of
$ 600 annually on the publisher of a newspaper under the News·
' papers Registration (Amendment) Act, 1971. Section 10 of the
Constitution of Antigua read as follows :

"10. (1) Except with his ·own consent, no person
shallbe hindered in the enjoyment of bis freedom of ex-
pression, and for tho purposes of this section the said
freedom includes the freedom to hold opinions and to •
receive and impatt ideas and information without inter-
ference, and freedom from interference ·with his corres-
pondence and other means of communication.

l-J (J). [1975) 3 All B.R. 81
INDiAN BXPRESS v. UNION (Venkataramlah, J.) 337
(2) Nothing contained in or done under the autho·
rity of any law shall be held to be inconsistent with or in
contravention of this section to the extent that the law in
question makes provision-·-(a) that is reasonably' requi-
red - (i) in the interests of defence, public safety; public
order, public morality or public health ; or (ii) for the
purpose of protecting the reputations, rights and freedoms B
of other persons, or the private lives of persons concerned
in legal proceedings, preventing the disclosure of infor-
• mation received in confidence, maintaining the authority
and independence of the courts, or regulating telephony,
telegraphy, posts, wireless, broadcasting, television or
' c
.. other' means of commu11ication, public exhibitions or
public entertainments ; or (b) that imposes restrictions
upon public officers."

Lord Fraser who delivered the judgment of the Privy
Council upheld the levy of the licence fee as being reasonably
required in the interests of defence and for securing public safety D.
etc. referred to· in section 10 (2) (a) (i) of the Constitution of
Antigua, The learned Lord observed in that connection ' thns :

"'Revenue requires to be raised in the interests .of
-'\. '
defence and for securing public ,safety, public order, public
El
morality and public health and if this tax was reasonably
required to 'raise revenue for these purposes or for any· of
them, then S. IB is not to be treated as contr1ivening the
Constitution.

In some cases it may be possible for a court to decide
from a mere perusal of an Act whether it was or was not F
/' :. reasonably required. In other cases· the Act will not
provide the answer to that question. In such.· cases has
evidence to be brought before the court of the reasons
for the Act and to show that it was reasonably required ?
Their Lordships think that the proper approach to the
G
question is to presume, until the contrary appears or is
shown, that all Acts passed by the Parliament of Antigua
were reasonably required. This presumption will be
rebutted if the statutory provisions in question are; to. use
· the- words of Louisy J, 'so arbitrary as to compel the
concJuSion t!Jat it·· does not involve a:n exertion of th
H

' '
'•*4:• {;:

.·~ .
338 SuPRBMll COURT REPORTS (1985] 2 S.0.R,
'lt..
taxing power but constit,utes in substance arid effect the 'r' '
·direst execution of a different· and forbiddden. power.'
If the , amount of the licence fee, was so mamfestly
excessive as to lead to the conclusion that the real reason
'for ii~ imposition was· not 'the raising of revenue but the
preventing of the publication of newspapers, then that. would
.just/fy the conclusion that ,the law was not reasonably
~equired for the raising qf revenue.

;·
In there Lordships' opinion the presumption. that
' .. '·
. the newspapers Registration (Amendment) Act, 197l' was
reasonably required has not been reputted am:t they do
c not regard the amount of the licence fee as nian.ifestly
a
excessive and of such character as to lead to the con-
clusion that S. IB was not enacted ·to raise revenue but
fo.r some other purpose.'' (Underlining by us)
Here again it is seen that the Privy council was of the
vjew that th~ Jaw did .not forbid. the l~vy of fee on the publisher.
or' a 11ewspaper but it would be qpen to challenge if the real
reason for its imposition was not the raising of revenue but the
preventing of the publication of newspaper.
At this .stage it is necessary to refer to a forceful . argUment
addresse!l: before us. It was urged on behalf of _the pefitiOners
that the £~cognition of the power of the Government to levy taxes
of any kind on die newspap~r establishments would ring in the •
death-knell of the freedom of press and would be totally against .,._. .
the spirit pf the .Constituti9.I\. It is, contended that the Govern:
F
ment Is likely to use it to make the press subservient to the 1'"
Government, It is argued that wben once this power is. conceded,
newspapermen will have to run a~er the Government an<! hence
it ought not to be done. This raisi:s a philosophical question-
Press versus Government. We do not think it is necessary for
~

..
·i
the press to be subservieµt to the Qovernment. As long as 'this I

Court sits' newspapermen need not have the fear of their freedom
G being curtailed by unconstitutionlll means. It is, however, good • !'
to remember some statements made in the past by some . wise.. men
connected with newspapers in order to develop the culture of an
independen1 press. Hazlitt advised editors to stay in their garrets
and avoid exposing themselves to the sub-Jeties of .power, Walter
H Lippman in his address to the International Press Instiute some
·' '•

' ') .... '
INDIAN EXPRESS. v. U~ION (Venkatar,amiah, J.) 339
years ago said that the danger to the independence and
integrity of journalists did not come from the pressures that might A
. .J.
be put on them ; it was that they might be captured and capiti-
' vated by the company they keep. Arthur Krock after 60 yeats
of experience said that it 'is true that in most cases, the price of
friendship with a politician is so great for any newspaperman to
pay'. A. P. Wadsworth of the Manchester Guardian said "that B
no editor should ever be on personal terms with our leaders for
+.. fear of creating· a false sense of relation of confidence." James
Margach says that 'when leading media figures see too much
rather than too little of Prime Minister that the freedom of press
is endangered.' Lord Salisbury told Buckle a famous editor in
England "you are the first person who has not come to see me in c
the last few days who is not wanting something at my ,hands-
place or decoration or peerage. You only want information."
Charles Mitchell wrote in 'Newspaper Directory'. The Press has
row so great and so extensive an influence on public opinion .......
that ....... .'.... its conductors should be GENTLEMAN in the true
sense of the word. They should be equally above corruption and 0
intimidation incapable of.being warped by personal consideratiohs
from the broad path 0£ truth and honour ; superior to all attempts
at mis'representing or mystifying public events'. If the press
ceases to be independent the healthy influence of the press and
public opinion will soon be substituted by the traditional influ-
ences of landlordism and feudalism. The press lords should E
endeavour to see that their intere~t do not come into conflict with
their duties. All this is said only to show that Government
alone may not always be the culprit in destroying the indepen-
dence Qf the press. Be that as it may, it is difficult to grant
that merely because the Government has the power to levy taxes F
the freedom of press would be totally lost. As stated earlier, the
court is always there to hold the balance even and to strike down
any unconstitutional invasion of that freedom.

• Newspaper industry enjoys two of the fundamental rights,
nathely'the freedom of speech and expression guara'nteed under
Article 19 (I) (a) and the freedom to engage in any pr<ifession,
' ' ~ .
occupation; trade, industry or busin'ess guaranteed under Article
19 (I) (g) of the Constitution, the first because it is concerned
with the field of expression and communication and the second
because communication has become an occupation or profession
and because there is on invasion of trade,' business an.d industry

'<::
''j, ._

-'
340 SuPlutME COtlRdUJPQll.tS tl985) 2 s.c.11. .
:futo that°' field where freedom--.of expression., is being· exercised.
While there,can be _no tax on the rignt to exerzise freedom of .;. .·
. .expression, tax is leviable on pro{ession, occupatioµs trade, busi-
ness and industry. Hence tax is. leviable on newspaper industry.
llut when_ such tax transgresses into the field of freedom of·
.expression and stifles that freedom, it becomes unconstitutional.
As long as it is within reasonable limits and does not impede
B freedom of expression it will not·be contrve1;1ing the limitations
of ~rticle 19 (2). The delicate task of determining 'w)len it
crosses from the area of professiqn, occ:1pation, trade, business or
industry into the area of freedom of_ expression and interferes with •
that freedom is.imtrusted to the courts.
'The petitioners, however, have placed strong reliance on
the Sakai's case (supra) and the Bennett Coleman's case (supra) ·
in support of their case that any tax on newsprint which is the
most important component of a newspaper is unconstitutional.
They have drawn our attenti9n to the following passage in the
D _decision in Sakai's case (supra) which is at page 863 :

" It ·may well be within the power of the sfate to
place, in the interest of the ·general public, restrictions
upcm the right of a cit/zen to carry on business but it is
. not open to the Stale to achieve this object by directly
E ·and immediately curtailing any other freedom of that
citizen guaranteed by the Cimstitution and which is not
susceptible of abridgement on the same grounds as are
set out in cl. (6) of Art. 19. Therefore, the right of •
fteedom of speech cannot be taken away with the obj~ct
'
'',' of placing restrictions on· the business activities of a
F citizen. l<'reedom of speech can be restricted only. in the.
interestsof the security 1of the State, friendly relations
with foreign State, pubTfo order, decency or morality
or in ,relation to contempt of court, defamation or in-
'citemeht to an offence_. It ·cannot, like the freedom to
carry on business, be curtailedin the interest of the general
G
public•.. If a law directly affecting it is challenged it is
no answer that the.restrictions enacted _by it are justifiable
und~r els, (3) to (6): Fof, the scheme of Art. -19 is to enu-
merate different freed~ms. seearately apd then to spe'lify
the e~tent of restrictions to wl;tich they 1nay ,be subjects and·
the object for seciirina which this could be done. A citizen

. :, .

\ -
INDIAN EXPRESS v. :UNION (Venkalaramiah, J.) 341
is entitled to enjoy each and every one of the ft'e~doms
A
together and cl. (I) does not prefer one freedom to
another. That is the plain meaning of this clause. It
follows from this that the State cannot make a law which
directly restricts one freedom even for securing the better
enjoyment of another freedom. All the greater reason,
therefore, for holding that the State cannot directly B
restrict one freedom by placing an otherwise permissible
restriction another freedom."

In Bennett Coleman's case (supra) the question which arose
for consideration related to the validity of a restriction imposed under
the newsprint policy which had certain objectionable features such c
as '(i) tbat no newspaper or new edition could be started. by a
common owner-ship unit even within the authorised quota of news-
• print (ii) that there was a limitation on the maximum number of
pages, no adjustment being permitted between circulation and
·pages so as to increase pages, (lii) that a big newspaper was prohi-
bited and prevented from increasing the number of pages, page D
area, and periodicity by reducing circulation to meet the require-
ment even within its admissible quota etc.. The majority held
that the fixation of page limit had not only deprived the petitioners
of their economic vitality but also restricted their freedom of ex-
pression. It also held that such restriction of pages resulted in
E
reduction of advertisement revenue and thus adversely affected the
capacity of a newspaper to carry on its activity which is protected
by Article 19(1)(a) of the Constitution. '

We have carefully considered the above two decisions. In the first
case the Court was concerned with the newspaper.price-page policy Jj'
and in the second the newsprint policy imposed by the Government
had been challenged. Neither of them was concerned with the power of
P-arliament to levy tax on any goeds used by the newspaper industry.
As we have observed earlier taxes have to be levied for the support of
' the Government and newspapers which derive benefit from the public
expenditure cannot disclaim their liability to con tribute a fair and G
reasonable amount to the public exchequer. What may, however,
have to be observed in levying a tax on newspaper industry is that
it should not be a over-burden on newspapers which constitute the
Fourth Estate of the country. Nor should it single out news-
paper industry for harsh treatment. A wise administrator should
realise that the imposition of a tax like the customs duty on IJ
_, -·
1)~f+-::~yo:c~-··if
,/"

', ,342 SUPIEME ,COt)R'J' il;PORTS '\ [1985] 2 s.c.R.
newsprint is an imposition on knowle9ge and would virtually
A
amount to a burden imposed on a man for being literate and for
being conscious of his duty as a citizen to .inform himself about the
world around him. 'The public interest in freedom of discussion
(of which the freedom of the press is one aspect) stems from the
requirement that members of a democratic society should be
sufficiel).tly informed that they may . influence intelligently the
B decisions wjlich may affect .themselves'. (Per Lord Simon of
Glaisdale in Attorney General v. Times, Newspapas('). Freedom of
expression, as learned writers have ·observed, has four broad
' social purposes to serve : (i) it helps an individual to attain self
fulfilment, (ii) it assists in the discovery of truth, (iii) it strengthens •
· the capacity of an ipdividual in participating in decision-making
0 · and (iv) it provides a mechanism by which it would be possible to
. establish a reasonable balance between stability and social change.
I All members of society should be able to form their own beliefs
• and communicate them freely to others. In sum, the fundamental
principle involved here is the people's right to know. Freedom of
· speech and expression should, therefore, receive a generous support
D
from all those who believe in the participation of people in the
, administration. It 'is on account of this special interest which
.-_._
·society has in the freedom of speech and expression that the approach
of the Government should be IllOre cautious while levying taxes on
other matters concerning newspapers industry than while levying taxes
on matters. It is true that this Court has adopted a liberal appr,oach
E
while dealing with fiscal measures and has upheld different kinds of
' taxes levied on property, business, trade and industry as they were
found to be in the public interest. But in the cases before us the
•
Court is called upon to reconcile the social interest involved in the
F freedom of speech' abd expression 'With the public interest involved
in the fiscal levies imposed by the Government specially because
.f
newsprint constitutes the body, if expression happens to be the soul.
' . ..
·In view of the intimate connection of newsprint with the
freedom of the press, the tests for determining the vires of a statute •
• G taxing newsprint ·have, therefore, to be different from the tests
usually adopted for testing the'Vires of other taxing statutes. fa the
case ·of ordinary taxing statutes, the laws may be questioned only
if they are either openly confiscatory or a colourable device to
confiscate. On the other hand, in the case of a tax on newsprint,

11 . (I) (1973) 3 AU. E.R. 54

?-"
INDIAN EXPRESS v. UNION (Venkataramiah, J.) 343
it may be.sufficient to show a distinct and noticeable burdensome-
ness, clearly and directly attributable to the tax. A
,.\__,
While we; therefore, cannot agree with the contention that no
tax can be levied on newspaper industry, we hold that any such levy
is subject to review by courts in the I igb t of the provisions of the
Constitution.
v ..8
Are the impugned notifications issued undes section 25
of the Customs Act, 1962 beyond the reach of the Adminis·
trative Law.
It is argued on behalf of the Government that a notification
issued under section 25(1) of the Customs Act granting, modifying
or withdrawing an exemption from duty being in the nature of a c
piece of subordinate legislation, its validity cannot be tested by
• the Court by applying the standards applicable to an administra-
tive action. Reliance is placed on the decision of this Court in
Narinder Chand Hem Raj & Ors. v. Lt. Governor, AdminMrator.
Union Territory, Himachal Pradesh & Ors. 11) in support of the above
D;
contention. In that case the appellants were wine marchants carry-
ing on business in Simla. At the auction held for the purpose of
granting the privilege to sell the Indian made foreign liquor the
appellants were the highest bidders. It appears that before the
auction was held the Collector of Excise and Taxation had announ-
ced that no sales tax would be liable to be paid on the sale of liquor
and despite this assurance the Government had levied and collected
from the appellants a certain amount by way of sales tax. The
appellants prayed for the issne ofa writ to the Governments restrain-
ing them from levying any sales tax and to refund what had been
recovered from them by way of sales tax already. It was contended on
behalf of the Government of Himachal Pradesh that non-collection
of sales Tax possible only on the' issue of a notification by the Govern-
ment pursuant to its statutory power under the Plflljab General
Sales Tax Act, which was in force in the area in question shifting
.• 'liquor' which was in Schedule 'A' to Schedule 'B' to the Punjab
General Sales Tax Act, and that such a notification could not be issued
G
because the Central Government had not given its requisite approval.
Hence it was urged by the Government that since sales tax had
been imposed by law on all items in Schedule 'A' it could not
' disobey the mandate of law. It further contended that the Court
could not issue a mandamus to the Government to issue a notifica-
tion to amend the Schedules to the statute as the act of issuing, such
a notification was a legislative act and no writ could be issued to a

' .
344 . SuPUMI! COURT RSPORTS [1985] 2 s.c.R.
legislative body or a subordinate Legi,slative body to a· make a law
'"'A or to issue a notification, as the case may be; which would have the
effect of amending a law in force. This Court upheld the contention
of the Government. The Court said:

"Our attention has not been drawn to any' provision in
that Act empowering the Government to exempt any assessee
from payment of tax. Therefore it is clear that appellant
was liable to pay the tax imposed under the law, What the
appellant really wants is a mandate from the court to the
competent authority to dele.te the concerned entry from
Schedule A and include the same in Schedule B. We shall
not go into the question whether the Government of
Himachal Pradesh on its own authority was competent to
make the alteration in question or not. We shall assume
I·
for our present purpose that .it had such a power. The.
power to impose a tax is undoubtedly a legislative power.
That power can .be exercised by the legislature directly or .
subject to certain conditions, the legislature may delegate
the power to some other authority. But the exercise of
that po:.ver whether by the legislature or by its delegate is
an exercise of a legislative .p9wer. The fact that the p.ower
was delegated to the executive does not convert that power
into an executive or administrative power. No Court can
issue. a mandate to a legislature to enact a particular law.
Similarly no court can direct a subordinate legislative body
·to enact or not to enact a law which it may be competent
to enact. , The relief as framed by the appellant in his writ
petition does not bring out the real issue calling for deter-
' .
mination. In reality he wants this Court to direct the
Government to delete the entry in ques.t,ion from Schedule
A and include the same in s'chedule B. . Art. .265 of the
Constitution lays down that no tax can be levied' and
collected except by authority oflaw. Hence the levy of
a tax can only be done by the authority of .law and not by '
any executive order. Unless the executive is specifically
empowered by law to five any exemption it cannot say
that it will not enforce tfle /aw as against a particular person.
No court can· give a direction to a Government to refrain
from enforcing a provision oflaw. Under these circum-
. ·stances, we-,must held that the relief asked for by the appel·
latn cannot be granted." (Underlining by us)
INDIAN EXPRESS v. uNiON (Venkataramiah, J.) 345
The above decision does not in fact support the contention of
the Government in the cases before us. It is noteworthy that the A
Court in the passage extracted above bas made a distinction between
the amendment of the Sch'edule to the PunjabGeneral Sales Tax Act
by the issue of a notification by the Government of Himachal Pradesh
in exercise of its power delegation by the legislature and the power
of that Government to grant exemption under a power to grant
exemption. In the present cases we are concerned with a power to
grant exemption conferred on Government by section 25 of the
Customs Act, 1962 and not with a power to amend the Act by
means of a notification. Moreover this was just a case relating to
business in liquor..

We shall assume for purposes of these cases that the power
.. to grant exemption under section 25 of the Customs A<:t, 1962 is a
legislative power and a notification issued by the Government there-
under amounts to a piece of subordinate legislation. Even then the
notification is liable to be questioned on the ground that it is an
unreasonable one. The decision of this Court in MuniCipa/ Corpora- D
tion of Delhi v. Bir/a Cotton, Spinning and Weaving Mills, Delhi &
Anr.(1 ) has laid down the above principle. In that case Wanchoo,
C.J. while upholding certain taxes levied by the Corporation of
Delhi under section 150 of the Delhi Municipal Corporation Act,
1957 observed thus :

"Finally there is another check on the power of the
Corporation which is inherent in the matter of exercise of
power by subordinate public representative bodies such as
municipal boards. In such cases if the act of such a
body in the exbrcise of the power conferred on it by the
law is unreasonable, the courts can hold that such exercise F
is void for the unreasonableness. This principle .was laid

.
."
'
down as far back as 1898 in Kruse v. Johnson [1898] 2.
Q.B.D. 91"

But it appears that the principle enunciated in Kruse v.
Johnson (2) is not being applied ~o stringently in England now.
G

A piece of subordinate legislation does not carry the same
degree of immunity which is enjoyed by a statute passed by a com·

(I) [196813 s.c.R. 251.
(2) [1898) 2 Q.B.D. 91.
~46 BtlPRl!MJ!.,COURT' REPORTS
,, j [1985] 2 S.C.R.
. petept legislature. Subordinate legislation may be questioned
A
on any of the grounds on which plenary legislation is questioned.
In addition it may also be questipned on the ground that it does not
conform to the statute und~r which it is .made. It may further be
,,gll!!stioned on the ground that it is contrary, to some other· statute.
th~t is because subordinate legislation must yield to plenary
legislation. It may also be questioned on the ground that it is
unreasonable, unreasonable not in the sense of not beiug reasonable,
but in the sense that it is manifestly arbitrary. In England, the
judges would say "Parliament never inten.ded authority to make
such rules. They are unreasonable arid ultra vi res". The present
position of law bearing on the above point is stated by Diplock,
c L.J. in Mixnam Properties Ltd. v. Chertsey U. D.C.(l) thus:
''The various grounds upon which subordinate legisla-
tion has sometimes been said tc{be void ......... can, I think,
today be properly regarded as being particular applications
of the general rule that subordinate legislation, to be valid
D must be shown to be within the powers conferred by the
statute. ,Thus the kind of unreasonableness which invali·
· dates a by-law is not the antonym of 'reasonableness' in
is
the sense of which tlrnt expression used in the common
law, but such mainfest arbitrariness; injustice or partiality
that a court would say : 'Parliament never intended to·
give authority to make.such rules : they are unreasonable
and · ultra vires .... ' lf the courts, can declare subordinate
legislation to be invalid for 'uncertainty,' as distinct from
unenforceable ... this must be beca\)Se Par!iment is to be
presumed not to have intended Jo a,uthorise the subordinate
F. legislative authority to ma~e changes in the existing law
· which are uncertain ....."

Prof,, Alan Wharam in his Article entitled 'Judicial Control
of Delegated Legislation : The Test of Resonabfeness' in 36
modern Law Review till at pages 622-23 has summarised the ' ' '
G present position in Eng)and 81 follows :
"(i) It is possible ijuit lhe courts might invalidate a
statutory instrument on the grounds of unreasonab~eness
, . or uncertainty, vagueness or aribitrariness; but the writer's . "

(1) (1964] I Q.B. 214.

··~"';·.
INDIAN EXPRESS v. UNION (Venkataramiah, J.) 347
view is that for all practical purposes such instruments
must be read as forming part of the parent statute, subject A
only to the ultra vires test.

(ii) The courts are prepared to invalidate by-laws, or·
any other form of legislation, emanating from an elected,
representative authority, on the grounds of unreasonable· B
ness uncertainty or repugnance to the ordinary law ;. but
they are reluctant to do so and will exercise their power
only in clear cases.

(iii) The court,s may be readier to invalidate by-laws
0
passed by commercial undertakings under statutory '
power, although cases reported during the present century
'suggest that the distinction between elected·' authorities
'and commercial undertakings, as explained in Kruse v.
Johnson, might not now be applied so stringently.

(iv) As far as subordinate legislation of non-statutory
D
origin is concerned, this is virtually obsolete, but it is
clear from In re French Protestant Hospital (1951] ch.
567 thadt wollld be subject to strict control."
(See also H.W.R. Wade: Administrative Law (5th
Edn.) pp. 747-748)..
E

In.India arbitrariness is noJ a separate ground since it will
come within the embargo of Article 14 of the Constitution. In
India any enquiry into the vires of delegated legislation must be
confined to the grounds on which plenary legislation may be
questioned, to the ground that it is contrary to the statute under F
which it is made, to. the ground that it is contrary to other
statutory provisions or that it is so arbitrary that it could .not
• be said to be in conformity with the statute or that it offends
Article 14 of the Consttiution.

That subordinate legislation cannot be questioned on the G
ground of violation of principles of natural justice on which ad-
ministrative action may b.e questiorred has been held by this Court
in The Tulsipur Sugar Co. Ltd. v. The Notifi_ea' Area .Committee,
Tulsipur(1l,' Rame<hchandra Kachardas Porwal & Ors; v, State of

(I) (1980] 2 S,C.R. till. H
'
. ,,
• 34g SUPREME COURT REPORTS · (1985] 2 s.c.a.
'
.Maharashtra & Ors. etc( and in Bates v. Lord Hai/sham. of St'
1).

Marylebo11e & Ors(').· A distinction must be made between
· •'de1egation of a legislative function in the case of which the ques·
tion of reasonableness cannot be enquired into and the investment
by statute to exercise particular d.iscretionary po)Vers. In the
.latter case the question may be consid.ercd on all grounds on
.,. B wl1ich administrative 'action may be . quest.ioned, such as, non·
application of mind,. taking irrelvant matters into consideration,
failure to tlllce relevant matters into considel'a.tion, etc. etc. On
the facts and' circumstances of a case, a sub~rdinate legislation
be may struck down as arbitrary or contrary to statute if it fails to
.'
take into account very vital facts which either expressly or by
. c' necessary implication are required to be taken into consideration
by the statute or, say~. the Constitution.. This can only be done ...
on the ground that it does not conform to the statutory or·.· consti-
tutional requirements or that it .,offends Article 14 or Article 19
(\) (a) of the Constitution. It cannot, no doubt, be done merely
on the ground that it is not reasonable or that it has not taken
into account relevant circumstances which ·the Court considers
relevant.;

W• do not, therefore,'find much substance, in the contention
that the coµrts cannot . ai all exercise judicial control over the
impugned notifications. In cases where the power vested in' the
IL
Goyerriment is a power which has got to be exercised iri the
public interest, as it happens to be here, the Court may require
the· Government to exercise that power in a reasonable way in
,accordance with the spirit of the Constitution. The fact that a
•
notification issued under sectidn 25 (1) of the Cnstoms Act, 1962
F is .required to be laid before Parliament under. section 159 there-
of does· not make any svbstantial difference as regards the juris-
diction of the court to pronounce on its validity.
l'he power to grant exemption should, however, be exercised
in a reasonable way. Lord Greene M.R. has explained in
Associated Provincial Picture Houses Ltd. v. Wednesbury Corpo-
G
ration(•) what a 'reasonable way' means as follows :
•
"It is true that discretion must be exercised reason·
ably. Now what does that mean 1 Lawyers familiar with
(l),Il981) 2S.C.R.-866·
(2).[1972) I WLR 1373•
.. ·. (3) (19-48l l K.JI. µ~.
INDIAN EXPRESS v. UNION (Venkataramiah, J.) 349
the phraseology used in relation to exercise of statutory A
discretions often use the word 'unreasonable' in a
rather comprehensive sense. Ithas frequently been used
and is frequently used as a general description of the
things that must not be done, For instance, a person
entrusted with a discretion must, so to speak, direct
himself properly in law. He must call his own attention 8.
to the matters which he is b'ound to consider. He must
exclude from his consideration matters which are icrele·
vant to what he has to consider. If he does not obey
those rules, he may truly be said, and often is said to
be acting'unreasonably'. Similarly, there may be some-
thing so absurd that no sensible person could ever dream
c
that it lay within the powers of the authority. Warrington
L..f. in short v. Poole Corporation [1926] Ch. 66 gave
the example of the red-haired teacher, dismisse~ because
she had red hair. This is unreasonable in one sense.
In, another it is so unreasonable that it might almost D
be described as being done in bad faith ; and, in
fiict, all these things run into one another."

Hence the claim made on behalf of the Government that
the impugned notifications are beyond the reach of the adminis-
trative law cannot be accepted without qulification even though E
all tlie grounds that may be urged against an administrative
order may not be available against them.

Now, the notifications issued on March 1, 1981 and Feb-
ruary 28, 1982 under section 25 of the ~ustoms Act, 1962 which
grant exemptions from payment of certain duty beyond what F
is mentioned in them are issued by the executive Government.
They were issued in substitution of earlier notifications which had
granted total exemption. Such notifications have to be issued
by the Government after taking into consideration all relevant
factors which bear on the reasonableness of the levy on the news-
G
print. The Government should strike a just and reasonable
, balance between the need for ensuring the right of people to free-
dom of speech and expression on the one hand and the need to
impose social control on the business of publication of a news-
paper on the other. In other words, the, Government must at
all material times be conscious of the fact that it is dealing with
an activity protected by Article 19 (1) (a) of the Constit11tion ff
350. SUPREME COURT REPORTS [1985] 2 s C.R.

which is ·vital to our democratic existence, In deciding the
A
reasonableness of restrictions imposed on any fundamental right
the court should take into consideration, the nature of the right.
alleged to have been infringed, the underlying purpose of the
restrictiOns imposed, the disproportion of the imposition' aad
the prevailing conditions at the relevant time including the social
values ·whose needs are sought to bo satisfied by means of the
restrictions. (See the State of Madras v. V.G. Rao(1)). The restriction
in question is the burden of import duty imposed on newsprint.
Section 25 of the Customs Act, 1962 under which the notifications
are issued confers a power on the Central Government coupled
with a duty to examine the whole issue in the light of the public
interest. It provides that if the Central Governmel)t is ·satisfied
C' that it is necessary in the public interest so to do it may exempt
generally either absolutely or subject to such conditions goods of
any description from the whole or any part of. the customs duty
leviable thereon. The Central Government may if it is satisfied
that in the public interest so to do exempt from the payment of
D duty by a special order in each, case under circumstances of an
exceptional nature to be stated in such order any goods on which
duty is leviable. The power exercisable under section 25 of the
· . Customs Act, 1962 is no. doubt discretionary but it is not. un-
restricted, . It is useful to refer here to the observations of Lord '
Denning M.R, in Breen v. Amalgamated Engineering Union(') at
.E page 190 read thus :
. "The discretion of a statutory body is never unfet-
tered. It is a discretion which is to be exercised according
to law. That means at least this : the statutory: body
must be guided by relevant considerations and noi by
F irrelevant. , If its decision is. influenced by exiraneous
considerations which it ought not: to have taken into.
: account then the decision cannot stand. No matter that ·
the statutory body may have acted in good faith never- ·
theless the.decision will be set aside; ·That· is established
by Pad-field v. Minister of Agriculture Fisheries and Food
[1968] A.C. 997 which is a landmark in modern adminis-
trative law."

. In any event. any notification issued under a statute also

(I) [1952] S.C.R•. S97.
H (2) (1971] 2 Q.B. 175.
INDIAN ll)(pJlESS v. UNION (Venkatar11111iah, J.) 351

being a 'law' as defined under Article 13 (3) (a) 9f th~ Consti , /A
tution is liable to be struck down if it is contrary to any of the
fundamental rights guaranteed under Part III of the Consti·
tution .
• VI
•
Has there been proper exercise of power under &Bl;/.,(()fl
25 (/) of the, Customs Act 1962?

Freedom of press as the petitioners rightly assert means
• freedom from interference from authority which would have the
effect of interference with the content and circulation of news-
papers. The most important raw material in the - production c
ofa newspaper is the newsprint. The cost and availability of
• newsprint determine the price, size and volume of the- pablication
and also the quantum of news; views and advertieements apppear·
ing therein. It is not disputed that the cost of newsprint works
out to nearly 603 ofthe cost of production of newspaper. In
the case of a big newspaper the realisation by the sale of news- D
paper is just alfout 40 % of' its total cost of production. The
remaining cost 'is met by advertisements revenue which is about
403 , by revenue from waste sales and job work ,which comes to
about 5% and revenue from other sources such as the income from
properties and other investments of the newspaper establishment. I
These figures have been derived from the statement furnished by
one of the big newspapers, The case of an other big newspapers
may be more or less the same. The financial and other _difficul-
ties felt 'by the newspaper presss in securing newsprint i~ recent
years which- have become an international phenomenon are set
out in the Final Report of the International Commission for the
Study of Communication Problems referred to above at page
,
141 thus:
l' ..
"Extremely serious on an international scale has
been the effect of high costs of important materials or
facilities .................................... Paper is a material G
consumed in vast quan,tities whose price in recent years
has spiralled out of proportion to the general wodd·wide '
inflation .........• , ................... As for newsprint, its price -
on world markets rose from a datum figure of 100 in. 1970'
to 329 in May 1977, and has continued to rise since.
A sad , l>y·product of this situation has been ,the intro· _R
·352 • ' ' ' SUPREME COURT REPORTS [1985] 2 s.c.R.

•. · duction of a covert form of censorship, as some Govern- .
men ts limit the import , of newsprint, dist~ibute it by·
· .. • · ·official , allocation scJ:iemes, and use these schemes to
discriminate against the opposition newspapers." ·
'
In Chapter 4 of the same Report at page 100 the Inter- _J.

·B national Commission has observed thus :

"While · newspapers which are commercial enterprises
, -.. . expect to .. sustain themselves by_ sales and advertising,
"''
, they. are not always viable 'on Ibis traditional basis
Capit~l . and' p~ofits from other media a~d from busines~ ··
., in, general · are. often inje~ted into the newspaper indus-
. . · .. try, .In many cases, the financing~ . or at least the deficits •
are covered by governments or ,;olitical bodies. Assis~ ·
, tance from the 'State has taken various ·forms,' including'•
·' '.· .• •tax concessions not enjoyed by. other industries, . reduced .
• , . postal . and 'telephone · rates, guaranteed Government
·D " ., advertising,. and subsidies . tc:i ~he price of .newsprint..
. , · Although the press is suspicious of .Government involve"'.
ment iri its affairs, a desir~ to preserve variety hy keeping
.,.:the weaker,papers alive has led to consideration' of various
schemes. Direct grants to P~l'ers in need are made ·in·
·E ; . · c. · seven European nations-,

Smaller newspapers and some. parts of the "quality"·
,, . · or "specialized'.' press have experienced difficulties from
, • 1. a contraction of op.erations and size,· 'which has led to .
~ )imitations on the variety .of information sources. ·This
F .: • has induced many governments to examine the possibi- '
. , · Jity of subsidies _to help. keep newspapers· alive ·or . to
establish new ones, in monopoly circulation areas· and. to
promote plurality and _variety. in general.
, .. ;
if any duty is levied on newsprint by Government, it
.. :G
neces..'1i:ily has to be passed on to the purchasers pf newspapers,,
unlesi·tb·e industry is able to absorb it. In order to pass ·on the
duty t~'the consumer the price of newspapers has to be increased,
Such i increase naturally affects the circulation of ,newspapers
adversely .. · · ·
..''H I:

" · Jn Sakai's case (supra), this Court has observed .thus :
INDIAN EXPRESS v. tlN!O'.N (Venkalfltlitniah, J.) ~53

"The effect of raising the selling price of newspaper
has been considered by the Press Commission. ln Para·
•A
graph 164 of the Report it is observed :

"The selling price of a paper would naturally
h'ave an important effect on its circulation, In B
!!
this connection we have examln'ed the effect of price~
cuts adopted by two English papers at Bombay on
t1fe circulation of those two papers as well as o~'lhe
leading paper which did not reduce its price. ·Prior
to ·27th October 1952, Times of India which had
th.e highest circulation a,t Bombay was being .sold at
Re, 0·2·6 while Free Press Journa1 and National
. Standard which rank next . i.n circulation were' being
sold for Re. 0·2·0. On 27th October, 1952, Free Press
Journal reduced its price to Rs. 0· 1.0 and within a
year had claimed to have doub\ed its circulation.
On .1st July, 1953, the NMional Standard wascon· D
vert.ed into a Bombay edition ot' Indian Express with
, a selling price of Rs. 0.1:6. Within six months it
" ,, too claimed to have doubled its cir.culation .......... ..
Duriµg this period the Times of India which .<!}d not
reduce its selling price continued to ~~tain its rea·
dership. Thus it would appear that Free fress E
Journal and Indian Express by reducing their price
have been able to tap new readership which was la·
tent in the market but which could not pay the higher
prices prevailing earlier."
F
Though the prices of newspapers appear to be on 'the
low side it is a fact that even so many people find it
difficult to pay that small price. This is what has •been
• pointed out b'y the Press Commission in Paragraph · 52 of
its report. According to it the most common reason
for people in not purchasing newspapers is the cost of
the newspaper and the inability of the household to spare
G
the necessary amount. This conclusion is based upon the
evidence of a very large number. uf individuals and 're·
___ )... prescntatives of Associations. We would, therefore, be
justified in relying upon Wand holding that raising ,the
price of newspaper even by a small amount such •as one
-~-,

354 SUPjUiWB COURT REPORTS [1985] 2 s.c.R.

A nP. in ·order that its present size be maintained would
adversely affect its circulation."

This is not a novel 11henomenon. A stamp tax on newspapers
came to be' levied in England in 1712, It virtually crippled the
growth of the English press and thus became unpopular. There was
B a lot of agitation against the said tax. But on its abolition in 1861,
the circulation of newspapers increased enormnously. The following
aceount found in the Encyclopaedia Britannica (1Q6,2) Vol. 16 at
page 339 is quite instructive :
"Abolition of ''Taxes on knowledge".-The develop-
• ment of the press ·was enormously assisted by the gradual
abolition of the "taxes on knowledge," and also by the
introduction of a cheap postal system .......................... .

To Lord Lytton, the novelist and politician, and sub-
sequently ti:> Milner Gibson and Rfohard Cobden, is chiefly
0 due the credit of grappling with this question in l'arliament
to secur~ first the reduction of the tax to a penny in 1836,
and then its total abolition in 1855. The number of news-
papers established from the early part of 1855, when the
·repeal of the duty had become a certainty, and continuing
E in existence at the beginning of 1857, amounted to 107; 26
were metropolitan and 81 provincial. The duties on paper
itself were finally abolished in 1861.

The abolitioll of the stamp .. taxes brought about such •
reductions in the prices of newspapers that they speedily
began to reach the many instead of the few. Some idea of
the extent of the tax on knowledge imposed in the early
19th century may be gathered from the fact that the
number of stamps issued in 1820 was nearly 29,400,000,
and the incidence of the advertisement tax, fixed ;it 3s. 6d. ,
in i 804, made it impossible for the newspaper owner to
G pass on the stamp tax to the advertiser. Jn 1828 the
proprietors of the Times had to pay the state more than £
68,000 in stamp and advertise.meat taxes and pa~r duty.
But after the reduction of the stamp tax in 1836 from
four pence to -0ne penny, the circulation of English .news-
papers, based on the stamp returns, rose from 39,000,000
ff to t22,ooo,ooo iti 18S4,"
INDIAN EXPRBSS v. UN(ON (Venkataramlah, I.) 355
The Second Press Commission in its Report (Vol. II) at pages
182-183 has stated that the figures of circulation of newspaper
compiled by the Audit Bereau of Circulation (ABC) for the period
January to June ]981 indicated that the circulation of newspapers
·in the period January to June 1981 was 1.9% lower than in the
previous six months period. The decline in the circulation of dailies
w asmore in the case of very big newspapers with circulation of one B
lakh and above than in the case of smaller papers. The Commis-
sion said that the decline in circulation would appear to be aitribnt-
able mainly to two factors-increase in the retail price of news-
papers in September-October, 1980 and again in April-May, 1981
and that the increase in retail prices appeared to have become .
necessary following continuing increase in newsprint prices in the c
lvst few years including levy of import duty in 1981 and increase in
v wages and salaries cost on account of Palekar Award. Of these
factors which were responsible for increase in prices, the imposition
of import duty on newsprint was on account of State action. This
aspect of the matter is not seriously disputed by the Government.
D
The pattern of the law imposing customs duties and .the
manner in which it is operated to a certain extent exposes the
citizens who are liable to pay customs duties to the vagaries of
executive discretion; While parliament has imposed duties by
enacting the Customs Act, 1962 and the Customs Tariff Act, 1975,
the Executive Government is given wide power by section 25 of E
the Customs Act, 1962 to grant exemptions from the levy of
Customs duty. It is ordinarily a~sumed that while such power to
grant exemptions is given to the Government it will consider all
relevant' aspects governing the question whether exemption should
be granted or not. In the instant case in 1975 when the Customs F
Tariff Act, 1975 was enacted, 403 ad valorem was levied on news-
print eveµ though it had been exempted from payment of such
duty. If the exemption had not been continued, newspaper
publishers had to pay 40% ad valorem customs duty on the coming
into force of the Customs Tariff Act, 1975. Then again in 1982 by
the Finance Act, 1982 an extra levy of Rs. 1,000 per tonne was G
imposed in addition' to the original 40% ad valorem duty even
though under the exemption notification the basic duty had been
fixed at 10% of the value of the imported newsprint. No informa-
tion is forthcoming from the Government as to whether there was
any material which justified the said additional levy. It is also not
clear why this futile exercise of levying an additional duty of
H
sun.oo com ilei>oll'l'S [,19851 ~ s.c.ll.

A/
Rs. 1,000 per tonne was done when under the notification issued
under section 25 of the Customs Att, 1962 on March 1, 1981 which
was.in force then, ~stoms duty on newsprint above 10% ad v~lorem
had been exempted. As mentioned elsewhere in the course of
this judgment while levying ·fax on an activity which·is protected
B also by Article 19(1)(a) a greater degree of care should be exhibited.
While it.is indsiputable that the newspaper industry should also·bear
its ilue share of the total burden ohaxation alongwith the rest of the
community when any tax is specially ·imposed on newspaper industry,
it should be' capable of beinJ! justified as a reasonable levy in court
when its validity is challenged. In the absence of sufficient material,
(h the levy of 40% plus Rs. 1,000 per tonne would become vulnerable
to attack.' If the lery imposed by the statute itself fails, there would
be no need to question the notifications issued :under section 25 of
the· Customs Act, 1962. But having regard to the 'Prevailing legisla-
. tive practice 1et Ifs assum'e that in order to determine the actual
D ,, levy we should take· into consideration not merely the rate of duty
mentioned in the Customs Tariff Act, 1975 but also any notification
issued Jnder section 25 of the customs Act, 1962 which isln fotce.
Eveli then the i'e~ns given by the isovernment to justify the total
customs di?fy of' 15% levied from March 1, 1981 or Rs. 'lf25 per
tonne as'.it is currently being leVflid'appear to be inadequate. Iri the
E , Finance Minister's speech delivered on the floor of the Lok Sabha
in 19Si;t)le:firstreason'giveil.
' '.,.\ '' .
for the levy of 15% duty was thatitwas
intc!nded"'to prolliote a measui'b of restraint in the consumption of
imported newsprint ancl thus heJ,P1il conserving foreign exc'hange".
This grountt appears to be not tenable for two rel!sons. . In the •
counter-affidavit fifed on behall' of the' Gbvernment, it is stated that
11 ·' the ·'allegation that the position of 'f6reign exchange reserve is com·
fortabfe · is itreleva~t. Tliis · shows that ndbody in Government had ~
over laken rnto co~side~ation the effect of the import. of new~print
on 'the foreign exchange reserve before issuing the notifications • •'
Ievyil\g 1.5% dlity. Secondly no newspaper owner can import
. . newsprint ditectly; ''Newsprint import is canalised through the State · ..
G '' Trading Coiporatiori. If excessi;/e import of newsprint adversely
affecis foreign exchahge reserve, the State Trading Corporation may
reduce' the import of newsprin!aild allocate lesser quantity of impor·
ted newsprint to newspaper establishments. There.is howeyer, no
• >i[
need to impose import cluty with a view to curbing execssive iri:iji6rt ,-'-.
of newsprint; 'fa the Finance Millisiet1s speech tliere is no reference
ff >to the capa6ity ofthe newspaper fod\istry to llear the levy 15% of
lNDIAN EXPRESS v. UNlON (Venkataramiah, J.) .. '357
duty. In the counter:affidavit it is asserted that the· extent o( .A I
burden faced by the newspaper industry in India is irrelevant to the
levy of import duty on newsprint. This clearly shows · again· that
the Government had not also considered avital aspect of th'e ques-
tion before withdrawing the total exemption which was 'being enjoy-
ed by newspaper industry till March 1,1981 ·and imposing 15%
duty on newsprint. E.
The petitioners have alleged that the imposition of customs
duty has compelled them 'to. reduce the extent of the ·area of the
newspapers for advertisements .which supply a major part of the
sinews of a newspaper and consequently has adversely affected
their. revenue from advertisements ... It is argued.· by them relying c '. l
upon the.ruling in Bennett. ·Coleman's case {supra) thatArticle 19(1)
(a) is infringed thereby. Our attention is.drawn to the following'
passages in Bennett Coleman's case (supra) which are at pages 777- .·
778 and at page 782 : · '
,,, . :; •,,,'1
"Publications means dissemination and circulation." D"
The press has to carry on its activity by keeping' ill. view : : ·
the class of readers, the· conditions of labour; price of · ,,
· material,· availability of adverisements, size of paper. and'
the different kinds of news · comments and·; views and
advertisements which are to be published and cfrculated.·'
The law which lays excessive and prohibitive burden which . '. E
. would restrict the cfrculation of' a newspaper will not be
saved by Article 19(2). · If the area of· advertisement is ··'
restricted. price of paper goes' up.· Ii the price goes up ".·'
circulation will go down. This was held· in Sakal Papers '
Case (supra) to be the direct consequence of curtailment' of ·' : · ·
F •
advertisement. The freedom of a newspaper to publish 0

any number of pages or to circulate 'it to any D.umb er of
persons has been held by this Court to be an integral p~t
of the freedom of speech and expression. This freedom is
violated by placing restraints upon something which is an
essential 'part of that freedom. · A restraint 'on the .number G
of pages, a restraint on circulation ' and restraint on a
advertisements would affect the fundemantal ' rights under"
Article 19{l)(a) on the aspects of propagation, ·publication .
and circulatioJ.: •..•..•....••..•. ~ ... ; ..•..•. ;•..•.••.••.. .'. "· '''"
--
- - -- --- -- --
'

The various provisions of the newsprint import policy · ' '
have been examined to indicate as to how the 'petitioners' '' II
358 U9SSJ 2 S.C.lt.
fundamental rights have been infringed by the restrictions
QI! pa&f· limit, prohibiton against new·new!papers and new
ellitions. The effect and consequences of the impugned
, policy upon the newepapers is directly controlling the
growth and circulation of newspapers. The direct effect
is the restriction upon circulation of newspapers. The direct
• effect is upon growth of newspapers through pages. The
direct effect is that newspapers are deprived of their area
.·,' of advertisement. The direct effect is that they are expos·
ed.to financial loss. The direct effect is that freedom of
·' speech and expression is infringed."'

c ··,I. '[' ,

In meeting the above contention the Government relying on
the . dec;ifiOn in Hamdard Dawakhana ( Wakf) Lal Kuan, Delhi & Anr.
v. Union of India & Ors.Pl has pleaded in defence of its 11ction that
the right to publish commercial advertisement is not part of
freedom of speech and expression. We have carefully considered
D the decision .in Hamdard Dawakhana's case (supra). The main plank
of that decision was that the type of advertisement dealt with there
did not carry with it the protection.of Article 19(1)(a). On examin·
ing the history of the legislation, the surrounding circum6tances
and ~e scheme of the Act which had been challenged there namely
the Drup and Magic Remedies (Objectionable Advertisements) Act
I: · · .1954 (21 of I954)the Court held that the object of that Act was
the· prevention of self-medication· and self-treatment by prohibiting
instruments which· may be. used to advocate. the same or which
tended to ·spread the evil. The· Court relying on the decition of
the America~Snpreme Court in Lewis J. Valentine'!. F.J. Chresten-
f sen <•> observed at pages 687~689 thus :

, "lt ~'11not be said that the right to.publish and distri-
b\\t~ commercial advertisements advertising µn individual's
personal business is a .part of fr~edom of speech guaranteed
by the ,Constitution. In Lewis Valentine v, F.J. Chreste:z ·
8 sen,ii was.held that tJle constitutional right of free speech
iR not infringed by pro))iW~ing the distribution iq city
atroe!• .of handbills .qe,a;:ing on one side a protest against.
action ta~llll by public officials and on the. other advertising
matter. The object of affixing of the protest to the
co c~Ja s.c,J;l..
611.
(2) 86>•taw Ed... 1262.. k ·
INPIAN EXPRESS v. UNION (Venkataramiah, J.) 359.

advertising circular was the evasion of the prohibition of a
A. ;
city ordinance forbidding the distribution in the city streets
of.commercial and business advertising matter. Mr. Justice
Roberts, delivering the opinion of the court said :

"This Court has unequivocally held that the streets
are proper places for the exercise of the freedom of com-
B
municating information and disseminating opinion and
that, though the states and municipalities may appropria-
tely regula,te the privilege in the public interest, they may
not unduly burden or prescribe its employment in these
public thoroughfares. We are equally clear that the Con-
stitution imposed no such restraint on government as
respects purely commercial advertising ......... If the
respondent was attempting to use the streets of New York
by distributing commercial advertising the prohibition of
the Code provisions was lawfully invoked against such
conduct.''
D
It cannot be said, therefor.0, that every advertisement.
is a matter dealing with freedom of speech nor can it be
said that it is an expression of ideas. In every case one
has to see what is the nature of the advertisement and what
activity falling under Art. l~(I) it seeks to further. The
advertisements in the instant case relate to commerce or
trade and not to propagating of ideas ; and advertising of
prohibited drugs or commodities of which the .sale is not
in the interest of the general public cannot be speech within
the meaning of freedom of speech.and would not fall within
Art. 19(l)(a). The main purpose an!! true intent and aim, F
object and scope of the Act is to prevent self-medication or
self-treatment and for that purpose advertisement com-
•
mending certain drugs and medicines have been prohibited.
• Can it be said that this is an abridgement of the petitioners
right of free speech ? In our opinion it is not. Just as in
G
Chamarbaugwa//a'a tase !957·S.C.R. 930 it was said that
activities undertaken and carried on with a view to earning
profits e.g. the business of betting and gambling will not
be protected as falling within the guaranteed right of carry-
ing on business or trade, so it cannot be said that an
-.~
advertisement commending drugs and substances an H
SUPREME COURT REPORTS [1985] 2 S.C.R.

A ap.propriate cure for certsin diseases is an exercise of the
right of freedo_m of speech."

In the above said case the Court was principally dealing with
the right to advertise prohibited drugs, to prevent self-medication
B and self-treatment.. That was the main· issue in the case. It is no
doubt true that .some of the observations referred to above go
beyond the needs of the case and tend to affect the right to publish
all cornrnercialadvertisernents. Such broad observations appear to
have been.made in the light or the decision of the. American Court
in Lewis J. Valentine v: F. J. Chrestensen (supra); But it is worthy
c of notice that the view expressed in this American case has not been
fully approved by the American .. Supreme Court itself in its ·
subsequent decisions. We shall refer only to· two of them. In his
concurring judgment in wi/liam B. Cammarano v, United States of
Amerka<'I Justice Douglas said "Valentine v. Chrestensen ... .....•
held that business of advertisements and commercial matters did
D not enjoy the protection of the First . Amendment, made applicable
to the States by the Fourteenth. The ruling was casual, almost
off hand. Arid it has not survived , reflection". In Jeffrey Gole
Bigelow v. Commonwealth of Virginia<•> the American Supreme
Court held th.at the holding.in Lewis J. Valentine v. F.J. _Chrestensen
E (supra) was distinctly a limited one. In view or the foregoing, we
feel that the observations made in the H.imdard Dawakhana's case
(supra) are too broadly stated and the Government cannot draw
much support from it. We are of the view that all.commercial.
advertisements cannot be denied the protection of Article 19 (I) (a)
of the Constitution merely because they are issued by businessmen.
F In any event ·the Government cannot derive any assistance from this
case to sustain the impugned notifications~ ·
~. - ..
It was next urged on behalf of the , Government that the levy
of customs duty on newsprint was not strictly. a levy on newsprint
G as such since though customs duties were levied with reference to
goods, the taxable event was th• import of goods within the customs
··barrier and hence there could be no direct effect on the freedom
of speech end expression by virtue of the levy of customs duty on
newsprint.· Reliance was placed in support of the above contention

(I) 3S8 US 498: 3 Led 2d 462
H (2) 421US809: 44 Led 2d 600 at 610
INDiAN EXPRESS v. UNION (Venkatarami(J/f; J.) 36In1.

on the decision in In re &a ·customs Act.(1) Thaf decision was· • A A
rendered on a reference made by the President under Article 143 of
the Constitution requesting this Court to record its opinion on the ·•
question whether the Central Government could i'evy d1stoms duty"'
on goods imported by a State. The contention of the hrajority of the
States in that case was that the goods imported 'by· thern being .B
their property no tax by way of customs could be levied fly reasonit>f·
Article 289 (1) of the Constitution which exempted' the property '
•
of a State from t~xation by the Union. This Court (majorify !r,''
minority 4) beta that in view of'clause (1) of Article 289 which was·
distinct from clause (2) thereof which provided tliat nothing in
clause (l) of Article 289 would prevent the Union from imposing:
c
or authorising the ihlpostition of'any tax to such extent', if any/a~' ·•
Parliament mikbt by law provitle in respect of a tralle or businelllP•
Qf any kind carried on by or on behalf of a State or any operatiollil I!
connec\F'1 .therewith or any property used or occupied for the
purposes of .such trade or business or' any incon\.e accruing or
' ' lt, ,-
arising in conntietion therewitli and the other proviSions of the
' D .
a
Constitution which enabled t!J,e ·union to levy 4iffer~nt kind~ of
taxes, customs duty levied OI) ..the importation of goocfs 'was only a
tax levied on ·international tr~de and not on property. The Court
further held that 't:he imiliunity granted under Article 289 (1) in
favour of States had to be restricted to taxes levied directly on
property and even though custo!11S duties ha.ct · referehce to gbods
and commoditie~ they were not taxes on propertr an'd hence not
within the 'exemption iii Article 289 (1). .Tl)e· above decision is
again of very little
-,•
assistailce
I
td the. Government
_ l ·'
since,._ it cannot' be
denied that the levy of custi>ms duty on ri-ewsprint·used in the
a
production of newspapers is restriction on the activity of publish- F
ing a newspaper and the levy of customs duties had a' direct elfect
on that activity. There exists no analogy beiwee~ . Article 289' (I)
and Article 19 (l) (a) and (2) ofthe Constitution. Hence the levy
1
cannot bejustified merely on the ground that it was not on any
• property of the publishers of newspapers. ''
G ,,.
Our att~ntion has been particularly drawn to the statement of
the Fiqanc~ Mi~ister that one of the considerationl\'.whJCh pxev11iled
upon the Goyenuqent to levy llte customs duty was that tjle newspa-
pers contained 'piffies'. A 'piffie' means foolish nonse11se. It ap;iears

(I) [1964] 3 S.C.R. 787. .• . H .('
' :i ~ "'
,-,- t

362 SUP.IU!MB COURT REPO!nS [1985] 2 S.C.R.

A' that one qf.. the reasons for levying the duty was that certain writings
in newspapers appeared to the Minister as 'piffies'. Such action is
not p'ermissible under our Constitution for two reasons-(i) that
the judgment of the Minister about the nature of writings cannot be
a true description of the writings and (ii) that even if the writlngs are
.. piffies it qannot be a ground for imposing a duty will whiohhinder
I · citc1Jlation of newspapers. In . this connection it is useful to refei
to the decision 9f the American SupreJlle ·, Court .in Robert £;.
Hannegaµ v. Esquire, ll'!c·<'> in which it was held that a publication
could not be deprived of the benefit of second class mailing rates
accorded to publications disseminating "information of a public
.character, or devqted literature, the sciences;. arts, or some special
c industry" because its contents might seem to the Postmaster
Geperal by. reason of vulgarity or poor taste, ·not to. co.iitr)bute to
the public good. Justice Douglas observed in that decision thus :

"It is plain, as we ·liave said,' that the favourable
second class rates were granted to periodicals meeting the
requirements of th~ Fourth condition, so that the public
good ni.ight be served through a dissemination of the class
'
of periodicals,, described. But that is
' ' - a far cry from
assuming that Congress had any idea that each applicant
.•. for the second-class rate must convin~e the Posim,aster
0

I . ~eneral that,his publication positively contributes to the
. public good or public welfare. Under our system of
11overnment there. is an accommod!ltion for ilie widest
yatietiea of tastes a,t;td ideas. What is good literature, what
has educational value, what is refined publip information, .'
what is good art, varies with individuals. as it does fro!ll
f one generation to another. There do~btless would.be a
contrariety of views concerning Cervantes' Don Quixote,
Shakespeare's VeQus & Adonis, or Zola's Nana. But a
requirement that literature or art conform to some norm
prescribed by an official S!llacks of an ideology foreign to
our system. The basic Values implicit in the requirements
G of the Fourth condition can be served only by uncensored
distrlliiltion of literature. "From the multitude of
~ompeting offerings the public will pick and choose. What •
seems to one to be trash may have for others fleeting or
. even enduring:values." '

(I) 327 U.S. 146 : 90 L. Ed. 586

,-': _.. '
I.
INDIAN EXPRESS v•. UNION (Venkataramiah, ).) 363
Matters concerning the intellect .and .. ethics do undergo
.. fluctuations from era to era. ·The world .of mind is a changing one. A
It is not static. The streams of literature and of taste and judgment
in that sphere are not stagnant. They have ·a qualiiy of freshness
and vigour. · They keep on changing from time to time, froni place
to place and from community ..to community.
It · is one thing to say that in view of considerations . relevant
to public finance which require every citizen to contribute· a
reasonable amount to public exchequer customs· duty is leviablc
even on newsprint used . by newspaper industry and an entirely
different thing to say that the levy is imposed because the newspa-
pers· generally contain 'piflles'. While the former may·· be valid if
'the circulation of newspapers is not affected prejudicially, the latter c
is · impermissible under the Constitution as the levy is being made .
on a consideration which is wholly .outside the constitutional
liwiations. The Government cannot arrogate to itself the power
to prejudge ·the nature of ·contents· of ·newspapers· even before they :
are printed. Imposition of a restriction of the above kind virtually D
amounts to conferring on the ·Government the power to precensor
· a newspaper. · The above-reason given by the Minister to levy the

'
'
customs duty' is wholly irrelevant. .
l , .

To sum up, the counter-affidavit filed on behalf of the
· Government in these cases does· not show· whether the Government
. ever considered the relevant matters: It says tha't the extent of
.

E

burden on the newspaper industry · imposed by ·the impugned levy is
irrelevant. It says that the position that foreign exchange reserve
is comfortable is not relevant. It does not say that the increasing
cost of imported newsprint was taken . into consideration. · The
Finance Minister says that the levy was imposed because he found
piflles' in some newspapers. There is no reference to the effect of
• the implementation of the Palekar Award. on the newspaper
industry. It does not. also state what effect it will have on the
•
members of the public who read newspapers and how far it will
reduce the circulation of newspapers. G
It is argued on behalf of the Government that the effect of
the impugned levy being minimal; there is no need to consider the .
contentions urged by the petitioners. As obserVed by Lord M~rris ·
of Borth·Y-Gest in Honourable Dr.· Paul Borg Olivier & Anr v. ·
H•nourab/e Dr. Anton· Buttigieg(') a case from Malta, that where
(I) U?67] A.C. I 1' (P.C.)
JI
;• 364 . SUPREME COURT REPORTS • [1985] 2 s.c.R •

'A fundamentar rights 'ancl freedom of the' individual ~re being cons.i-
" dered,ca 'court should be cautious before accepting 'the view• that
' :some' particular disregard of them is of minimal account. The learned _
'Lord' observed in the above case that there was always the likelihood
. of the violation being 'vastly widened. and extended with impunity.
He also referred to the words of Portia~'Twill be recorded for a
B _ precedent, and many an error by the same example will. ru<h into ·
~ the state', and the following passage. from the American case i.e
Thomas v. Collins :(1) : • ., •

. '' . , .. "The r;straint is not small.when it is considered what ..
' .. ' . ' . ,. . '

a
- . . . . was · restrained... The right is national right; federally'·
'

'.C .~ • '. guaranteed. ,There is son:e modicum of freedom of
thought, -speech and assembly which all citizens of. the
. , . ; republic· may.: exercise throughout its length. and breadth,"
, .. ·. which no state, nor all together,, not the nation itself,. can .
. .. ! . prohibit, restrain.or impe~~' .Jf. the restraint were smaller:.
D ; · , than it is; it is from petty. tyrannies that large ones take
,'" ..•. root and grow .. This fact· can be more plain than when··
-. .. ; ... they are impos~d on the most basic right of.all. Seedlings
planted.in that soil grow great and, growing, break down
the foundations of liberty." ··

. ·: , .fo. th~ab~ve decision the Prl~y _Council cited with approval
. the view expressed by this Court i.n Romesh Thappar's case (supra)
.and in Martin v. City of Struthers.('); The Privy Council observed
· thus : · ·· · · · · ·
'' :t ~. ,I

"A measure of interference with the free handling of
the newspa.per rand its free circulation was involved in the
F
prohibition which the circular imposed. It was said in an
. ·Indian case-Romesh"Thappey v. State of Madras):
,, ..
.' . "There can be no doubt that freedom of speech and
, ei::pression includes freedom of prepagation of ideas and •
G tliat freedom is secured by , freedom of circulation,
.. 'Liberty: of circulation is as· essential to that freedom as
<' the liberty of publication. Indeed· without circulation
the publication would be of little value." , •
...
(2) [1944)323 U.S. Sl6
.. JI . (3) (19431319 u,s. 141 '.
INDiAN EXPRESS v. UNION (Venkfltaramiah, J.) 365
Similar thoughts were• expressed by Black J. in his
. judgment in Martain v. City of Struthers when he said: A

"Freedom to distribute information to every citizen·
wherever he desires to receive· it is so.. clearly· vitaf to the
preservation of a free society that, putting aside
reasonable police and health regulations of time and '
manner of distribution, it must be fully preserved". · .,B

We respectfully endorse the high principle expounded by the
Privy Council in the above ·case. Moreover in the absence of a
. proper e.xamination of all relevant matters, it is not possible to hold
· that the ·effect of the levy is minimal. In fact the· impact. of the
.C
impugned levy in these cases i~ not minimal at all: For. example,
The Tribune Trust has to pay Rs. 18.7 lacs and The Statesman Ltd.
·has to pay Rs. 35.9 lacs by way of customs· duty -on newspfint
imported during 1983-84. Other big newspapers have also to pay
farge sums by way of customs duty annually. ·· ..
! D
The question in the present cases is whether· ihe tax ha~ been
shown to be so burdensome as to warrant its being struck down 1
The petitioners have succeeded in showing a fall in circulation but
whether it is a direct comeque;:;ce o( the customs levy and the in-
crease in price has not b~en duly established. It may be due to varioi;s
circumstances. The fall in circulation may be due to the general rise .F
in cost ofJiving and the reluctance of people to buy as many news-.
papers as they used to buy before. It may be due to ba(I management.
It may be due to change of editorial policy. It· may be due to_ the
absence of certain feature writers. It may be due to other cfrciim-
. stances which it is not possible to .enumerate. Except the synchronising F
of time, there is nothing to indicate that the slight fall in· circulation
is directly due to the levy of customs duty. One curious feature of
the case is that the petitioners have made no efforts to produce
their balance sheets or profit. and loss statements to. give us a true
idea of how burdensome the customs levy really is. On the other·
hand, the Government also has made no efforts to show the effect G
of the impact of the levy on the newspaper jndustry as a whole .
. All these years,. the very exemption which they; granted was an
. indication that the levy was likely to have a serious impact on the
. newspaper industry. Even now the exemption given to the small
and medium newspapers shows that there is bound to be an impact.
No effort has been made on the part of the .Government to .show
366 8U'.PREMI! COURT REPORTS · [1985] 2 s.c.a.

the 'precise nature of the impact. On the other band, the case of
, .the Government appears to be that such considerations. are entirely
irrelevant, though the outstan<ling fact remains that for several
years, the Government itself thought that the newsprint deserved
total exemption. · On the material now available to us, while it
is not possible to come to the conclusion that the effect of the levy
B is indeed so burdensome llS'to affect the freedom of the press, we
are also not ·able to come to the conclusion that it will not be
l>nr,?ensome. This a matter which touches the freedom of the press
which is, as we said, thjlvery soul of democracy. This is certainly
not a question which should be decided on the mere questioji of •
burden. of proof. There are factors indicating that the present levy
c is heavy and is perhaps heavy enough to affect circulation. On stlch
,a yital issµe,. we cannot merely say that the petitioners .have not
..P~~ed sUllicient material to establish the drop in circulation ii
·directly linked to incre!lse of the levy when, on the side of the
Government the entire exercise is thought to be irrelevant. Hence
there appears to be a good ground to· direct the Central Government
to reconsider the matter afresh in the light of what has been said here.
. . r

· VII

ls ·the classification of newspapers made for the purpose
of exemption Yiolaiive of Article 14 ?

1 We do not, however, see much substance in the contention. of

some of the petitioners that the. classification of the newspapers into
iimall, medium and big newspapers for purposes of levying custo.ms •
duty is violative of Article 14 of the Constitution, The oject of
exempting small newspapers from the payment of customs duty and
f
levying 5% ad valorem (now Rs; 275 per MT) on roedium newspa-
4...
pers while-levying full customs duty on big newspapers is to assist , ~
the small and medium newspapers in bringing down their cost .of ~

.production. 'Such papers do· not command large advertisement >
,revenue. Their area of circulation is limited and majority of them
G iuein Indian languap cateri11g to rural sector. We do not find h
· anything sinister in the object nor can it be said that the classifica- . '
tion ·has ho nexus with the object to be achieved. As observed by < .~
Mathew, J. in the Bennett Coleman's case (supra) it is the duty of the
State to encourage education of the·masses through the medium of
the press under Article 41 of the Constitution. We, therefore,
·Hject this coute11tion •

... ,-
.:,o·'·~ ... ·-~:
JNDIAN EXPRESS v. UNiON (Venkataramiah, J.) 367
VIII
Relief
Now arises the question relating to the nature of relief that
may be granted in these petitions. These cases present a peculiar
difficulty which arises out of the pattern of legislation under
consideration. If the impugned notifications are merely quashed,
they being notifications granting exemptions, the exemptions granted B
under them will cease. Will such quashing revive the notification
dated July 15,1977 which was in force prior to March 1,1981 under
• which total exemption had been granted? We do not think so .
The impugned notification dated March l, 1981 was issued in
supersession of the notification dated July 15,1977 and thereby it
achieved two objects-the notification dated July lS,1977 came to 0
• be repealed· and 103 ad valorem customs duty was imposed on
newsprint. Since the notification dated July 15,1977 had been
repealed by the Government of India itself, it cannot be revived on
the quashing of the notification of March l,1!181. The effect of
such quashing of a sub1equent notification on an earlier notification D
in whose place the subsequent notification was issued has been
considered by this Court in B.N. Tiwari v. Union of India & Ors.f!.)
In that case the facts were these : In 1952, a 'carry forward' rule
governing the Central Services was introduced whereby the unfilled
reserved vacancies. of a particular year would be carried forward for
one year only. In 1955 the above rule was substituted by another E
providing that the unfilled reserved vacancies of a particular year
would be carried forward for two years. In T. Devadasrm v. The
Union of India & Anr.(•) the 1955 rule was declared unconstitutional.
One of the questions which arose for consideration in this case
Tiwari's 'case (supra) was whether the 1952 rule had revived after
the 1955 rule was struck down. This Court held that it could not
revive. The following arc the observations of this Court on the
above question :
•
"We shall first consider the question whether the
carry forward rule of 1952 still exists. It is true that in
Devadasan's case, the final order of this Court was in these G
terms:-

"In the result the petition succeeds partially and
-(:'.':l):""'.["°t9:-:6c-:5]_2_S-.C-.R-.-4-21--
(2) [1964] 4 S.C.R, 680
ff
..
I( ..
368 SUPREME COURT REPORTS [1985] 2 s.c.R.

the carry forward rule as modified in 1955 is declared ('--
invalid."

That however does not mean that this Court held that
the 1952-rule must be deemed to exist because this Court said
that the·carry forward rule as modified in 1955 was declared
B invalid. The carry forward rule of 1952 was substituted
the carry forward by rule of 1955. On this substitution the
carry forward rule of 1952 clearly ceased to exist because
its place was taken by the carry forward rule of 1955.
Thus by promulgating the new carry forward rule in
1955, the Government of Jndia itself cancelled the carry
c forward rule of 1952. When· therefore this Court struck
down the carry forward rule as modified in 19S5 that did •
not mean that the carry forward rule of 1952 which had
alreadyiceased to exist, because the Government of India
itself cancelled it and had substitued a modified rule in
D 1955 in• its place, could revive. We are therefore 'or
opfoionthat after the judgment of this Court in Devadasan's
case there is no carry forward rule at all, for the carry
forward rule of 1955 was struck down by this Court while
the carry forword.rule of 1952 had ceased to exist when

E
the.Government of India substituted the carry forward rule +
of 1955 in its place."

In Firm A.T.B. Mehtab Majid & Co. v. State of Madras & Anr.(')
also this Court has taken the view that once an old rule has been
substituted by a new rule, it ceases to exist and it does not get
F revived when the new rule is held invalid.

The rule in Mohd. Shaukat Hussain Khan v. State of Andhra
Pradesh(') is inapplicable to these cases. In that case the subsequent
Jaw which modified the earlier one and which was held to be void '
was one which according to the Court could not have been passed
G at all by the State Legislature. In such a case the earlier law could
be deemed to have never been modified '.or repealed and would,
therefore, continue to be in force. It was strictly not a case of
revival of an earlier law which had been repealed or modified on

(I) [19631 Supp. 2 S.C.R. 435 at 446.
ft (2) (197S] I s,c.R. 4~·
INDIAN EXPRESS v. UNION (Venkataramiah, J.) 369

the striking down of a later Jaw which purported to modify or repeal
A
the earlier one. It was a case where the earlier law had not been
either modified or repealed effectively. The decision of this Court
in Shri Mufchmzd Odhai:ji v. Rojkot Borough Municipality is also
distinguishable. In that case the State Government had been
empowered by section 3 of the Saurashtra Terminal Tax and Octroi
Ordinance (47 of 1949) to impose octroi duty in towns and cities B
specified in Schedule I thereof and section 4 authorised the
Government to make rules for the imposition ,and collection of
octroi duty. These rules were to be in force until the City
Municipalities made their own rules. The rules framed by the
Municipality concerned were held to be inoperative. Then the
question arose whether the rules of the Government continued 'to
be in force. The Court held : 0

"The Government rules, however, were to cease to
operate as the notification provided "from the date the
said Municipality put into force their independent by laws."
It is clear beyond doubt that the '.Government rules would
cease to apply from the time the respondent-Municipality
brought into force its own bye-laws and rules under which
h could validly irnpose, levy and recover the octroi duty.
The said notification did not intend any hiatus when neiiher
the Government rules nor the municipal rules would be in
the field. Therefore, it is clear that if the bye-laws made
by the respondent-Municipality could not be legally in
force •ome reason or the other, for instan~o. for not having
been validly made, the Government rules would continue
to operate as it cannot be said that the Municipality had
"put into force their independent ,bye-Jaws". The Trial F
Court, as also the District Court, were therefore, perfectly
right in holding that the respondent-Municipality could
• levy and collect octroi duty from the appellant-firm under
the Government rules; There was no question of the.
Government rules being revived, as. in the alifience of
valid rules of the respondent-Municipality they continued
to operate. The submission of counsel in this behalf,
therefore, cannot be &ustained."

In the cases before us we do not have rules made by two

(1) A.I.R. 1970 S,C. 68~ ff
370 SUPREME COURT REPORTS (1985] 2 s.c.R

A different authorities as in Mu/chand's case (supra) and no intention
on the part of the Central Government to keep alive the exemption
in the event of the subsequent notification being struck down is also
established. The decision of this court in Koteswar Vittal Karnath v.
K. Jf.angappa Baliga & Co.(l) does :not also support the petitioners.
In that case again the question was whether a subsequent legislation
which was passed by a legislature without competence would have
the ~!feet of reviving an earlier rule which it professed to supersede.
This case again belongs to the category of Mohd. Shaukat Hussain
·Khan's case (supra). It may also be noticed that in Koteswar Vittal
Kamath's case (supra) tlie ruling in the case of Firm A.T.B. Mehtab

• Majid & Co. (supra) has been distinguished. The case of State of
Maharashtra etc. v. The Central Provinces Manganese Ore Co. Ltd.(')
is again distinguishable. In this case the whole legislative process.
termed substitution was abortive, because, it did not take effect
for want of· the 'assent to the Governor-General and the Court
distinguished that case from Tiwari's case (supra). We may also
,D state that the legal .effect on an earlier law when the later law
enacted in its place is declared invalid does not depend merely upon
the use of words like, 'substitution', or 'supersession'. It depends
upon the totality of circumstances and the context in which they
are used.
In the cases before us the competence of the Central' Govern-
E
ment to repeal or annul or supersede the notification dated July
15, 1977 is not questioned- Hence its revival on the impugned
notifications being held to be void would not arise. The present
cases are governed by the rule laid down in Tiwari's case (supra)
Hence if the notification dated July 15, 1977 cannot revive on
F the quashing of the impugned notifications, the result would be
disastrous to the petitioners as they ·wollld have to pay customs
duty of 40%ad va/orem from March 1, 1981 to February 28, 1982
and 403 ad va/orem plus Rs.1,000 per MT from March 1, 1982 •
onwards. In addition to it they would also be liable to t pay
G auxiliary duty of 30%ad valorem durini;i the fiscal year 1983-84
and auxiliary duty of 50% ad va/orem during the fiscal year 1982-83.
They would straigtaway be liable to pay the whole of customs duty •
and any other duty levied during the current fiscal year also. Such
a result cannot be allowed to 'ensue.

(I) [1969] 3 S.C.R. 40.
B. (2) (1977] I S,C.R. 1002.
iNDiAN EXPRESS v. UNION (Tlenkataramiah, J.) 371

,... It is no doubt true that so me of the petitioners have also
' questioned the validity of the levy prescribed by the Customs Tariff
Act, 1975 itself. But we are of the view the it is unaecessary to qua·
sh it because of the pattern of the legislative provisions levying cus-
toms duty which authorise the Government in appropriate' cases
either to reduce the duty or to grant total exemption under section
~ 25 of the Customs Act, 1962 having regard to the prevalling B
• circumstances and to very such concessions from time to time. The
Governmental prectice in the matter of customs <lutes has· made the
law imposing customs virtually a hovering legislation. Parliament
expects the Government to review the situation in each case
periodically and to decide what duty should be levied within the limit
prescribed by the Customs Tariff Act, 1975. Hence the validity of
the provision in the Customs Tariff Act, 1975 need not be examined
c
• now. Since it is established that the Government has failed to dis-
·~ charge its statutory obligations in accordance with law while issuing
the impugned notifications issued uuder section 25 of the Custom
Act, 1961 on and after March 1, 1981; the Government should be
directed to re-examine the whole Lsue relating to the extant of D
exeruption that should be granted in respect of imports of newsprint
after taking into account all relevant considerations for the period

"°' subsequen tto March 1, 1981. We adopt this course sinse we do not
also wish that the Government should be deprived of the legitimate
duty which the petitioners would have to pay on the imported news-
print during the relevant period. E

In the result, in view of the peculiar features of these cases and
having regard to Article 32 of the Constitution which imposes an
obligation. on this Court to enforce the fundamental rights and
Article 142 of the Constitution which enables this Court in the
exercise of its jurisdiction to make such order as is necessary for F
doing complete justice in any cause or matter pending before it, we
make the following order is these cases:
•
The Government of India shall reconsider within six months
the entire question of levy of import duty or auxiliary duty payable
by the petitioners and others on newsprint used for printing news- G
• papers, periodicals etc. with effect from March 1, I 981. The
petitioners and others who are engaged in newspaper business shall
make available to the Government all information necessary to
decide the question.

2. If on such reconsideration the Government decides that
H
'.i

372 (1985) 2 s.c.R.
there should be.aµy modification in. the levy of custo111s duty or
A
auxiliary duty wi1h effect from March 1, 1981, it shall take necessary
.steps to implement its decision. ·

3. Until such redetermination of the liability of the petitioners
B and others is made, the Government shall recover only Rs. 550 per
MT on· imported newsprint towards customs duty a11d auuiliary
duty and shall not ·insist upon payment of duty in accordance with
the impbnged notifications. The concessions extended to medium
and small newspaers. may, however, remain in force.
0 •
4 .. If, after such redetermination, it is found that any of the
petitioners is· liable to pay any deficit amount by way of duty, such
deficit amount shall be paid by .such petitioner within four months
•
from the date on which a notice of demand is served qn such .
petitioner by the concerned authority, Any bank guarantee or
D security given by the petitioners shall be av.ailabe for recovery of
such deficit amounts.

5. If, after such redetermination, it is found that any of the
petitioners is entitled to any refund-such refund _shall be made by
the Government within four months from the date of such redeter-
I
mination.
6. A writ shall issue to the respondents accordingly in these

.:•. cases. Parties shall, however, bear their own costs.

I' The petitions are accordingly allowed .

A.P.J. Petitions allowed.
•

•