The Puzzles in our Preambles: A Backdoor to Common Law or a Self-Contained Code?

Anirud Raghav & Prem Vinod Parwani |

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I. Introduction

While reading a case on the law of contracts or evidence, one will often find an Indian Court applying a principle sourced from the common law. One often hears that this is because India is a ‘common law nation’, and so developments in English common law continue to be of (limited) interpretative relevance. But what principles of law must apply to a field of law occupied by statutes - such as the Indian Contract Act 1872 (‘ICA’) or the Indian Evidence Act 1872 (‘IEA’)? Do common law principles continue to play a role in such cases? More pointedly, did these statutes intend to exclude common law principles? This piece suggests that the answer lies in the preambles read in the context of legislative history. To make this point, the article focuses on two colonial-era legislations - the ICA and the IEA.

It is surprising to find that there is scant scholarship on the critical question of the relationship between Indian statutory law and common law principles. V. Niranjan neatly summarises the thrust of our examination in one paragraph:

“If India was perhaps the first jurisdiction in which private law was organized around (largely) a ‘code of English law’, it is surprising that there is little analysis in the literature, or indeed in the recent Indian cases, of the interaction between the common law and the Indian statutory provisions. Its importance cannot be overstated; in many areas of Indian private law, the answers to contentious questions in the modern law lie in this neglected legislative history.”

In this context, we undertake an extensive historical analysis of the legislative history of the ICA and the IEA, and how the legislative intent to include or exclude the applicability of common law principles manifested in these preambles of these Acts. Read closely, the preambles in the context of legislative history yields an answer to the question—is there a place for common law where statutes like the ICA and the IEA already exist?

To this end, the piece intends to do three things – Part II broadly introduces how preambles can act as a window to understanding the exhaustiveness (or non-exhaustiveness) of the Acts in question. It answers questions like when an Act must be construed as a ‘complete code’, and what does it mean to call it so? In what circumstances can one peer beyond the statute and apply written principles of common law? Part III takes a deep dive into the ICA, and firstly traces the judicial interpretations on ICA’s preamble and how it provides a clue regarding the non-exhaustiveness of the Act. It secondly excavates the drafting history of the ICA preamble, which further indicates the non-exhaustiveness of the Act. We find that by and large, Courts have interpreted the preamble in line with the drafting intent, but also caution against an overly broad interpretation of the preamble so as to enable indiscriminate recourse to common law. Part IV compares this with another noteworthy legislation, the IEA, finalized also by Stephen.

It first considers the strong drafting intent behind the IEA to depart from the murky waters of English law by engaging with both legislative history as well as a few judicial decisions which affirm the exhaustive nature of the Code. They notice that the addition of the word ‘consolidate’ hints towards the idea of a ‘complete code’ excluding resort to common law. However, in what follows, the piece secondly, notes a discomfiting trend where Courts have tended to resort to common law more frequently than not. This is in loggerheads with the unambiguous drafting intent and previous judicial decisions. The doctrinal nuance that was recognized by Courts in interpreting the ICA is absent in interpretation of the IEA.

To caveat our conclusion – we do not argue that preambular language in general is determinative of whether common law principles continue to apply;[1] instead, we make the modest claim that the preambles of the ICA and IEA provide a clue as to whether the legislations were intended to be complete codes. The implications of this question are important, for it answers the doctrinal question of which law operates in a given field – and for fields such as evidence and contract, the ramifications are far-reaching.

II. How the Preamble Can be a Window to the Drafters’ Intent

The preambles of the two legislations are as follows:

1. Indian Contract Act, 1872: WHEREAS it is expedient to define and amend certain parts of the law relating to contracts.

2. Indian Evidence Act, 1872: WHEREAS it is expedient to consolidate, define and amend the law of Evidence; It is hereby enacted as follows.

The primary difference between the two enactments lies in IEA’s addition of the word “consolidate.” Since both these statutes were enacted at the same time and finalised[1] by the same drafter, JF Stephen—we suggest that the differing language is a conscious legislative choice. Specifically, we suggest that the usage of the word “consolidate” suggests that the statute was intended to be a self-contained code, while the use of the words “define and amend” suggests that the statute was intended to allow a backdoor entry of common law principles.

We may briefly survey the scholarly expositions on the scope of these statutes. Starting with the Indian Contract Act, we may first refer to one of the foremost luminaries, Prof. Mullah. In the second edition of his commentary on the Indian Contract Act, he notes the following on the scope of the Act:

The Contract Act does not profess to be a complete code dealing with the law relating to contracts. As appears from the preamble, the Act purports to do no more than define and amend certain parts of that law. No doubt it treats of particular contracts in separate chapters, but there is nothing to show that the Legislature intended to deal exhaustively with any particular chapter or subdivision of the law relating to contracts.

Interestingly, however, his commentary on the scope of the Act is immediately succeeded by a discussion of the savings clause (s.1). This clause effectively permits the application of principles, customs and usages of native law (prominently, Hindu and Mahomedan law) as well as other statutes and regulations insofar as they are not inconsistent with the ICA. In noting this, Mullah starts his discussion on the savings clause (particularly, regarding the saving of native law) by referring to the preamble and how it suggests that the ICA is not a complete code:

As stated above, the Contract Act does not cover the whole field of contract law. In cases, therefore, not provided for by the Contract Act or other legislative enactments relating to particular contracts, it is incumbent upon the High Courts, in the exercise of their original jurisdiction, to apply the Hindu law of contract to Hindus and the Mahomedan law of contract to Mahomedans…

This gives us a clue as to what the scope of the sentence “ICA is not a complete code” is: all this means is that it also includes the various types of rules saved by the savings clause. It is not intended to provide a backdoor to invoke English law.

A similar suggestion is put forth by Setalvad:

“Yet, its preamble states that it is an attempt only to define and amend certain parts of the law relating to contracts. The courts have held that the Act is not a complete code dealing with the law of contracts (citing Irrawaddy) and have, in the absence of specific provisions in the Act, frequently applied principles of English common and statute law and the decisions of English courts. In cases for which no relevant provision is found in the Contract Act or other enactments relating to contracts, the courts have even applied rules of Hindu and Muslim law of contracts to Hindus and Muslims…Well recognized customs and usages of trade have also been saved by the provisions of the Act and have in the absence of any inconsistent provisions in the Act been applied by Indian Contracts (sic).”

He too notes how Indian Courts have interpreted “define and amend” to mean that the ICA is not exhaustive, and where the ICA lacked a relevant provision, Courts would invoke either principles of English law or local customs and usages.

In this light, a recent Delhi HC decision on the ICA referring to the effects of these permutations in preambular language appears helpful. In ONGC v. Schlumberger Asia Services, the Court held, in interpreting the ICA, that its scope was only to define and amend; it was not a consolidating code (language that appears in the IEA). In doing so, the Delhi HC brings the distinctions in the preambulatory language to the fore:

44. The legislature has clearly spoken that wherever the legislature thought it expedient to define and amend certain parts of the law relating to contracts, the Indian Contract Act 1872 has been enacted. It is thus not an enacting code. It is also not a consolidating code. The Act does not profess to be a complete code. To the extent the legislature has enacted, law of contract would be governed by the Indian Contract Act 1872, and wherever not the courts would be free to cull out common law principles and apply the same. Of course the said principles should not be in conflict with the statutory provisions of the Indian Contract Act 1872.

In sum, it emerges from these judicial interpretations that the differing use of preambular language is not mere surplusage – it could be a window into the minds of the drafters as to the completeness of these legislations. In subsequent sections, we will test this hypothesis against the legislative history and judicial treatment of both, the IEA and the ICA.

III. Is the ICA a Complete Code?

In this section, our endeavour is twofold. First, to assess the drafting history of the ICA to decipher which way the legislative intent swayed, as far as the exclusion of common law principles went. We find that there was ample legislative indication, both by way of law commission reports Second, to analyse how far Indian judicial decisions have noted this.

1. Judicial Treatment of the ICA

   
   

   1. Irrawaddy & Post-Irrawaddy Interpretations of the ICA-common law debate

      
      

While we agree that the ICA is, by design an incomplete code and that common law principles are of utility, the judicial treatment of the preamble suggests that English common law must be resorted to where the ICA is deficient. We survey this landscape and suggest that the root of this thinking is rooted in an overly broad reading of the locus classicus on the subject.

The locus classicus on this point is the case of Irrawaddy v. Bugwandass, decided by the Privy Council in 1891. Here, the question was whether common carriers were liable for any damage to goods caused. In answering this, the Privy Council had to consider two conflicting potential sources of liability: the first being the statutory principles in the Carriers Act, 1865, along with common law principles on the liability of common carriers; while the other was the liability as bailees under the Indian Contract Act, 1872. In case the former source of liabilities prevailed, the common carriers would be held liable. However, they would not be held liable if only the bailees’ general duty of care in s.152 prevailed.

The Court (speaking through Lord Macnaghten) held that the ICA only purports to define and amend the law and is by no means exhaustive. While considering the purport of the statute, it held that the ICA did not do anything to repeal the 1865 Act and re-enact its provisions with necessary alterations in the 1872 Act. It was, to the Privy Council, “scarcely conceivable that [the ICA] could have intended to sweep away the common law by a side wind, and by way of codifying the law to leave the law to be gathered from two Acts, which proceed on different principles, and approach the subject…from different points of view.” This harmonious interpretation of the statutes is not a matter of much controversy.

In what follows, however, lies the source of controversy. The Privy Council produced two sets of statutorily rooted reasons to go beyond the ICA and validate the application of unwritten common law principles. First, it observed the relevant provision in the ICA applicable to that case; this was s.152 on the liability of bailees. It specifically noted the implicit savings provision in s.152—namely—“The bailee, in the absence of any special contract, is not responsible for the loss…”. The Privy Council effectively held that a contract for common carriage would qualify as a special contract, and this allowed them to traverse beyond s.152 to affix liability. Secondly, it held that the ‘unwritten law’ on common carriers (which is primarily of interest to us, as being common law), would continue to apply despite the existence of a codified law on contracts. This is because unwritten rules relating to carriage were outside of ICA’s scope, which only dealt with incidents of contract. As such, the unwritten law on common carriers continued to apply as a “duty cast upon common carriers by reason of their exercising a public employment for reward.” The notion of incidents of contract is rather significant. The savings provision saves, as it were, the applicability of incidents of contract to the extent that these are not inconsistent with the ICA. Yet, neither the Privy Council nor any subsequent decision has spent much energy interpreting ‘incidents of contract’.[1] 

The question that arises is this: does Irrawaddy allow us to conclude that the ICA is not a self-contained code, thereby allowing a backdoor to common law principles of contract? We do not think so. While considering the applicability of ‘unwritten principles’, the Court was not considering the applicability of general contractual principles which were already codified in the ICA. Rather, the Court was confronted with distinct regimes of law - the ICA’s provisions on bailment and the unwritten law on common carriers. This is evident from the Court’s reasoning that the unwritten law on common carriers was outside the ICA’s scope. At best, one may say that Irrawady is the authority to say that common law principles may continue to apply generally, as long as they are not inconsistent with the ICA. In C. Boggiano And Co. vs The Arab Steamers (1915), the Bombay High Court correctly appreciated the pointed scope of Irrawady’s dictum, holding:

14.⁠ ⁠I do not think that, when their Lordships said that there was in India before the Indian Contract Act a complete code for common carriers, they intended to decide that the general provisions of the Common Law relating to the formation and performance of contracts should still be applicable to contracts entered into by the public with common carriers.

Interestingly, several subsequent Indian judgments interpret Irrawaddy to have laid down the broad proposition that where Indian law falls short, English principles of contract can (and even must) be resorted to. In Firm Kanhaiyalal vs Dineshchandra (1959), the Madhya Pradesh High Court was faced with a question of jurisdiction — for which it had to determine where the telephonic contract was concluded. It applied the English rule of contract that a telephonic offer is concluded when the contract is accepted. To justify its application of this rule, it holds:

9. It has been held in numerous decisions that as the Act is not exhaustive, in cases where the terms of the Act do not apply the principles of English law, if applicable to Indian conditions, are applicable as rules of justice, equity and good conscience (see The Irrawaddy Flotilla Co. v. Bugwandas, 18 Ind App 121 and Jwaladutt v. Bansilal, Therefore, when any matter cannot be brought within particular provisions of the Contract Act, then consistent with the provisions of the Act, it would be permissible to apply English principles in dealing with the matter.

In Punjab National Bank Ltd. vs Arura Mal Durga Das (1960), the Punjab HC used a similar line of reasoning to incorporate the “rule of English law that the Bank has a lien or more appropriately, a right to set off against all monies of his customers”. In doing so, it once again cites Irrawady, noting:

Where the statutory provisions do not cover a particular matter the principles of English law, in so far as they embody the rules of justice, equity and good conscience may be applied vide Irrawaddy Flotilla Co., v. Bugwandas, ILR 18 Cal. 620 (628) (PC) and Jwaladutt R. Pillani v. Bansilal Motilal, ILR 3 Bom. 414 (418): 9 AIR 1929 PC 132 (133)).

b.     The Proper Way to Read Irrawaddy: Statutory Hook and Savings?

As seen above, both the foregoing judgements frame Irrawaddy as positing a ‘fallback’ to English law in the interests of “justice, equity and good conscience” - a phrase that Irrawady does not use even once! Even scholarly treatment of Irrawady has suggested that it has been read as enabling a natural fallback to English law where the code seemed incomplete. We think this is not the full story, and that Courts and scholars have subsequently read Irrawaddy far too expansively. We argue instead that Irrawaddy should be understood to be laying down a more limited rule. The most noteworthy quality of the Irrawaddy decision is that it grounds the application of common law principles in the ICA, through savings clauses under s.1 (incidents of contract) and s.152 (special contracts, being common carrier contracts). The narrower rule thus emerging is this—English law must only be resorted to where the ICA itself permits such recourse. Usually, this is in the form of savings provisions.

Prof. Mullah also interprets Irrawaddy to have laid down a more limited proposition, rooting its reasoning in the ICA:

“the Judicial Committee (in Irrawaddy) were inclined to the opinion that the liability of a common carrier under the English common law as an insurer of goods was not a usage of trade, but that it was an “incident” of the contract quite consistent with the provisions of the Act. Such an incident is not inconsistent with the provisions of ss. 151 and 152 of the Act, having regard to the words “in the absence of any special contract” occurring in s. 152.”

He suggests, in other words, that the judgment makes a much sharper, limited point. It held that the purported custom in question was an incident of contract which is explicitly saved by s.152. It did not suggest simpliciter that common law can be applied where the ICA falls short; it held that the usage in question might qualify as an incident of contract. Thus, there is a case to be made that the Privy Council’s judgment in Irrawady cannot be framed as an authority countenancing the application of English common law. 

Irrawaddy roots the application of common law principles to the ICA itself. In that case, the Court noted that the liability of the carrier was established as a matter of first, an incident of contract in the savings clause, and second, saved by s.152 which exempts the provision’s applicability to “special contracts”. Thus, there was a clear textual hook undergirding the application of principles extraneous to the ICA. However, later judgments have not captured this aspect of Irrawaddy—they use Irrawaddy to say that common law can apply where Indian law falls short (or does not cover adequate ground), as long as it is not inconsistent with the ICA. However, they do this in a manner unmoored from the text and scheme of the Act, omitting Irrawaddy’s consideration of the savings clause.[2] At best, we think that the broadest possible ratio that could be abstracted from Irrawady is this – that common law principles may be applied where the scheme of the ICA allows for it.

It is not our argument that common law principles can find no place in the Indian scheme. In fact, the savings clause in s.1 specifically saves the applicability of “incidents of contract” which are not inconsistent with the Act.  Furthermore, special savings clauses (such as the one in s.152, or s.219[3]) may also provide this textual or schematic support. Common law certainly has a place – as we will see later in the piece, the legislative history of the ICA supports the proposition that it was by no means a complete code. Our issue with the reception of Irrawaddy is that this narrow place it has is unappreciated. Rooting the applicability of common law in the narrow scheme of the ICA would ensure conformity with the text of the ICA, and circumscribe the unfettered importation of English law. After all, the ICA not only defines but also amends — after thorough deliberation, rules of English law.

A good appreciation of the narrow place of common law principles (where the ICA already holds the field) is seen in the minority judgement of the Madras HC in Natesa Aiyar vs Appavu Padayachi (1913). The Court was tasked with determining the law around the forfeiture of a deposit on failure to carry out the contract. Justice White for the majority examined Sections 64 and 74 of the Act, holding that since the texts of these provisions were not facially applicable to forfeiture clauses, the English rule in Howe v Smith (1884) must be applied. This line of reasoning follows the mainstream interpretation of Irrawady – fall back on common law where the statute is not immediately clear. However, J. Sadasiva Aiyar dissented, holding that a careful appreciation of the scheme of the ICA would show that it could be applied to such forfeiture clauses:

30. ….Though there might be some portions of the law of contracts not covered by the Act, I do not think that, so far as the general principles are concerned, the learned Legislator would have failed to indicate them with sufficient clearness and fullness for the guidance of Indian Courts….as regards the enunciation of the general and universal principles of the Law of Contracts, I think that the Contract Act was intended to be as exhaustive as possible.[4]

39. Having read Sections 39, 64, 65 and 75 of the Contract Act together my mind is clear that the framers of the Contract Act intended that money received by a vendor under a rescinded contract of sale (rescinded property by the vendor) should be returned to the purchaser, leaving full liberty to the rescinding vendor to recover damages from the purchaser for the latter's breach of contract. We have got the authority of Mr. Stokes for saying that the illustrations (b) and (c) to Section 65 of the Contract Act properly belong to Section 64 of that Act.

Justice Aiyar abstracts the principles from these ICA provisions to show that situations such as forfeiture clauses were contemplated in the scheme of the ICA. In fact, he even cites Whiley Stoke’s historical treatise on the Anglo-Indian codes – showing a keen doctrinal appreciation that is rare in the judicial treatment of the code. We further draw support for this reading of Irrawady from the historical material showing that the codification project was not merely one of codifying principles into provisions, but also one of doctrinal reform.

2. The Drafting History of the ICA

The ICA was drafted between 1863 and 1866 by three members of the Third English Law Commission: Romilly M.R., Erle C.J. and Willes J.[5] These drafters substantially attempted to codify the English law of contracts –  the ICA was intended to be ‘an original and expert attempt to present a simplified statement of the English Law of Contract with some modifications— though not a great number’ (p.94). Pollock also notes in the very first edition of Pollock and Mulla (now India’s household referencer on the law of contracts) that “The Indian Contract Act is in effect…a code of English law with some modifications therein.” 

In 1925, the Civil Justice Committee said:

“The Indian Contract Act was in some respects a far-sighted statute but it was never among the best of our codes dealing with the law of contracts, and in the absence of provisions covering specific situations, the courts have frequently applied principles of English law.”

JF Stephen, who joined the legislative council in 1870 and then made modifications to the Law Commission’s draft himself, expressed the incompleteness of the code. While making certain changes to the draft (to the now infamous provisions on consideration and force majeure), he expressed hopes that ‘supplementary chapters’ would be enacted in the future. Thus, while the ICA was not comprehensive or complete, it did however, provide a basic framework within which contractual issues could be grappled with. Stephen, a staunch advocate of codification – wished for more codes to supplement it. While these supplementary chapters were never enacted, we saw Irrawady being used to indiscriminately import English law principles.

The 13th Law Commission caught on to this need for supplementing the Act, noting that it was “preferable to add to the Act the English common law principles…so that it may not be necessary to refer to English law in many cases.” (para 3) While attempts have been made at reform – identifying such areas of reform requires a degree of sophistication in the law of contract that the Indian legislature has not demonstrated. Even more, having the legislature implement such reform is easier said than done. For instance, the 13th Law Commission recommended substantial additions to the law on indemnities, given the bare-bones provisions in the Act. In another post on this blog, we have argued that the provisions on indemnity in the Act are essentially defunct; a drafting anomaly that is of almost no utility in application. While the Law Commission’s amendments would have addressed this issue, the suggestion has not seen the light of day in nearly 70 years. The inexhaustiveness of the ICA is thus clear – and there are certainly gaps to be filled. It is, however,  questionable to suggest that blindly resorting to common law is our answer to this problem.

Our gripe with the mainstream Irrawaddy construction of indiscriminately resorting to common law is that it tends to undermine what the Indian drafters sought to do—to do away with certain rules of English law. However, oftentimes, this intention to depart from common law might not be immediately apparent from the provision itself. This leads to problems. A paradigmatic example is s.74 of the Contract Act, which sought to do away with the LD-penalty distinction. However, judicial decisions, by resorting to common law, brought this dichotomy back in. The LD-penalty distinction, at face value, does not seem to be completely inconsistent with the text of Indian law in that it does not expressly contradict any provision of the ICA; thus, it might be thought that taking recourse to the LD-penalty distinction is unproblematic. But this is clearly not so—the complexity of the LD-penalty jurisprudence, which was sought to be circumvented, now stands strongly entrenched in Indian law. This practice of importing English law contrary to drafting intent is visible in other contract law doctrines as well – on privity, consideration, novation and frustration. Dr. Shivprasad Swaminathan suggests that this practice continued because colonial-era judges were wedded to their English common law paradigms. The mere enactment of a code would not cleanly break English law from Indian law, and the English law hangover thus stuck around in the judiciary.

There are, however, offhand examples of doctrinal clarity. Justice Sadasiva Aiyar in Natesa Aiyar  – (the case we brought out as an example of a careful appreciation of the scheme of the ICA) took extensive pains to distinguish between the English and Indian rule on LD:

“We know how Courts in India followed too closely the English decisions which made refined distinctions between penalty and liquidated damages and which treated a provision for enhanced interest from date of bond as a penalty but not a provision for enhanced interest from the date of default. The amendment of Section 74 and the new illustrations added to it did away with all these distinctions imported into India from England and treated all stipulations in a contract.”

The incorrectness of the import of the common law rules of the ‘LD-penalty distinction’ and the ‘genuine pre-estimate test’ into s.74 are only now gaining currency in mainstream scholarship. In this light, we submit that Irrawady must be read more narrowly than it has; if carefully done (as by J. Aiyar), it can respect the amending nature of the Act, and thus, appreciate its doctrinal scheme. If this was done so, perhaps we would not be grappling with the faulty import of English law into s.74.

IV. The Murkier Story of the Indian Evidence Act

1. The (Differing) Drafting History of the IEA

Having noted how Irrawaddy cannot be held to say that common law applies simpliciter, there are some other decisions dealing with the Evidence Act which might help us understand the relationship between the preambular phrasing and the window to apply common law more clearly. Notably, the IEA uses ‘consolidated, define and amend’. We suggest – textually, and based on historical material, that the use of the word ‘consolidate’ suggests that it was intended to be a complete code. This is unlike the ICA, as we have seen above, where define and amend have been held to mean that the Act is not exhaustive, and potentially leaves room to take recourse to common law. In other words, the IEA, unlike the ICA – leaves no room for common law. However, as we will see, most judicial interpretations of the IEA have been sharply off-track by importing English law, while very few pay attention to its consolidating nature. Thus, it is all the more important to pay heed to the preambulatory language in the statutes.

The true consolidating nature of the IEA is supported by the history of India’s codification project. While JF Stephen’s eventually tinkered with the draft before 1872, the mould of the ICA was already in place. Thus, the ICA as we know it today is a product largely of the Law Commission’s work, and Stephen’s subsequent tinkering. This is not the case for the IEA, which was entirely Stephen’s work. The Third Law commission did submit a draft on the law of evidence – however, it consisted only of 39 clauses and was referred to a ‘Select Committee’ in 1868, who called it ‘ill-arranged and ‘elementary’. As such, the draft was eventually rejected (p.481). This is when Stephen swooped in with the IEA – it was entirely his brainchild. He introduced it to the Legislative Department in 1870 (after the Law Commission had already resigned), and it was enacted in 1872.

Unlike the Law Commission’s ICA, Stephen’s IEA was not a substantial restatement of the basic principles of the law of evidence. Instead, Stephen saw the codification project as an opportunity to overhaul the law of evidence. He did this by overturning the common law confusions of ‘admissibility’ into questions of ‘relevance’. While Stephen retained several universal, foundational principles of the law of evidence (such as the rules on hearsay, dying declaration and the exclusion of confessions to police officers), the scheme of the Act was turned on its head. Questions concerning ‘admissibility’ (i.e., whether evidence pursuant to a fact is allowed to be given) in common law were turned into questions of relevance (i.e., whether the fact being sought to be proved is probative) in the IEA.

Another example lies in how Stephen intended to depart from certain common law rules of evidence. On the rule of hearsay, Stephen noted that it was “vague to the last degree (p.51).” He resolved to address this ambiguity by making hearsay a rule of ‘relevance’ instead of ‘admissibility’. As such, the provision commonly associated with hearsay appears under Part I of the IEA on the ‘Relevancy of Facts’. Professor Ambasta closely documents how Stephen intended to untie the common law’s hearsay knot by doing this.

While scholars such as Stokes and Thayer have extensively lambasted Stephen’s drafting for these changes, others have sought to defend it as Stephen’s novel, inventive solution to the twisted knots in the common law rules of evidence. For our purposes, it suffices to say that the IEA was clearly doing something radically different from the common law, the credit for which did not belong to the Law Commission.

Even the IEA’s text supports this. Section 2 of the original Act (now curiously repealed) expressly repealed all rules of evidence not contained in any Act – a provision that one common law historian attributes to Stephen’s intention to abolish all rules pre-1872 confusions in the English law of evidence (p.25). Not coincidentally, the ICA does not contain any similar repeals provision. Rather, it has what is possibly the opposite – a savings clause which potentially kept the gateway (albeit limited) to common law open. It saves “any usage or custom of trade, nor any incident of any contract.” It is not our intention to go into much detail about whether the savings clause of the ICA does in fact keep the gateway open. Broadly, it is enough to conclude for now that there were significant historical and schematic differences in the ICA and the IEA, owing to which their nature as ‘self-contained codes’ differs.

2. The Off-Track Judicial Treatment of the IEA

   
   

Following trends similar to those seen in the ICA, most Indian Courts have simply applied English law of evidence without heed to the consolidating nature of the Act. In fact, the use of English principles and tests is taken for granted.

To begin with, the schematic difference that Stephen contemplated is nearly entirely obliterated. Rules of relevance are routinely conflated with those of admissibility – in Ratan Singh, the Supreme Court effortlessly calls s.6 of the IEA (located in Part I of the IEA, titled the ‘Relevancy of Facts’) a rule of admissibility of evidence, despite the provision containing nothing of that sort. The rules on the admissibility of evidence are located elsewhere in the IEA (in ss. 65, 65B, 136 and so on). Such examples of this judicial treatment are rife (see here, here and here). Even for provisions on ‘similar fact evidence’, the tests are imported directly from English law. In interpreting s.11 of the IEA on similar fact evidence, the Supreme Court in Chandrakant Jha borrowed the ‘striking similarity’ test directly from the UK House of Lords judgement in DPP v Boardman (1975).

Even for the rule of hearsay, which Stephen intended to alter as a rule of relevance – Indian courts have treated it as a rule of admissibility. This is evident from the landmark exposition of hearsay under the IEA regime by the Privy Council in Subramaniam v Public Prosecutor (1956), where it held that a statement would be “hearsay and inadmissible when the object of the evidence is to establish the truth of what is contained in the statement.” This phenomenon continues even today, in a Supreme Court judgement as recent as 2022. Despite noting the absence of a ‘hearsay rule’ resembling English law in the IEA, the Supreme Court goes on to say:

“40. Although the expression “hearsay evidence” is not defined under the Evidence Act, it is, nevertheless, in constant use in the courts. However, hearsay evidence is inadmissible to prove a fact which is deposed to on hearsay, but it does not necessarily preclude evidence as to a statement having been made upon which certain action was taken or certain results followed such as evidence of an informant of the crime…”

Thus, the fallback to English law is an old habit that seems to die hard. In Parbhoo v. Emperor the Allahabad High Court even went on to clearly enunciate this attitude:

“It follows that, even though a matter has been expressly provided for by the Evidence Act, recourse may be had to English decisions in order to interpret particular provisions of the Act when they are of doubtful import owing to the obscurity of the language in which they have been enacted.”

However, there are decisions which recognise the complete and consolidating nature of the ICA. Note however, that these are minority voices in judicial discourse.[6] In Musheer Khan v Badshah, J. Ganguly holds:

“39. It will be noticed that under the Indian Evidence Act, the word `admissibility' has very rarely been used. The emphasis is on relevant facts. In a way relevancy and admissibility have been virtually equated under the Indian Evidence Act.”

Few cases catch on to this schematic difference. Another such example is the Allahabad HC in Rishi Kesh Singh v. State, recognising the consolidating nature of the Code:

“The Evidence Act is a complete Code and its purpose is to consolidate, define and amend the law of Evidence. Consequently, the provisions of this Act shall govern all the judicial proceedings in or before any Court. We cannot look into the English practice or the law prevalent in our country in the past on the ground of public policy or the interest of justice.

The word ‘consequently’ is important here, since it moors its reasoning in the language of the preamble. This would later be reaffirmed by the Supreme Court in Hira H. Advani v. State of Maharashtra, where the Court, mincing no words, held:

“Our law of evidence which is a complete Code does not permit the importation of any principle of English Common Law relating to evidence in criminal cases to the contrary”.

However, the Supreme Court’s reasoning rested on a Privy Council judgment, which held that the original s.2 of the Evidence Act repealed all English law rules on Evidence. Unlike the Allahabad HC in Rishi Kesh, the Supreme court in Advani did not refer to the consolidating nature of the Evidence Act to reach its conclusion. Regardless, both these paths lead us to the same conclusion – of the completeness of the IEA.

Thus, while not the dominant strand of judicial discourse in the IEA, there are several judgements which recognise the self-contained nature of the IEA, as opposed to the relatively more open-ended nature of the ICA. In sum, two things emerge. First, the word ‘consolidating’ is indeed significant. It facially implies the completeness of a code. Second, common law principles can be used, where the Code is not a consolidating or enacting one. But one must be careful to ensure that it does not conflict with the scheme of the Act. The dominant reading of Irrawady’s dicta risks the importation of English law with broad brush strokes, without the necessary granular attention to the scheme of the Act. This appears to be the only limitation on applying English principles in interpreting the Indian Contract Act.

V. Conclusion

This paper has endeavoured to show two things. First, the preambular phrases used in the ICA and the IEA are significant in determining whether the drafters intended for recourse to be taken to common law. The ICA’s preamble employs the phrase ‘define and amend’ which has been interpreted by Courts (and admitted by Stephen himself) to mean that the Act is not exhaustive, and that common law may be applied so long as it is not inconsistent with the ICA. Similarly, the IEA uses the phrase ‘consolidate, define and amend’. This, read alongside the drafting history of the IEA, suggests that the Act was meant to be exhaustive and exclude common law (and its myriad difficulties) altogether. However, we also show, secondly, that Indian Courts have disregarded the drafting intent to move away from common law, and have routinely re-imported the very principles that the Code sought to remedy. While our argument is limited to the preambular language and the historical and legislative context of the IEA and the ICA, it may be useful to excavate similar doctrinal trends within other legislations. For some context on such further research, below is a table of all legislations and their respective preambular usage. While this paper does not venture to comment on this broader trend, a pattern seems to emerge – the legislations using the words ‘consolidate’ are to do with the subject matter of India’s local peculiarities, with little to no doctrinal roots in the common law; for instance, the law of succession, stamps and registration. On the other hand, legislations with ‘define and amend’ in the preamble had established bodies of English law at the time of their codification; for instance, the law of trusts, property and sale of goods – suggesting that such bodies of law could be resorted to where the Act was felt deficient. Who knows – perhaps the answers to our puzzles lie in our preambles!

Sl. No	Act	'Consolidate'	'Define and Amend'	'Amend'
1	Indian Contract Act, 1872		Yes
2	Indian Trusts Act, 1882		Yes
3	Transfer of Property Act, 1882		Yes
4	Indian Easements Act, 1882		Yes
5	Negotiable Instruments Act, 1881		Yes
6	Indian Succession Act, 1925	Yes
7	Sale of Goods Act, 1930		Yes
8	Indian Partnership Act, 1932		Yes
9	Married Women's Property Act, 1874			Yes
10	Majority Act, 1875			Yes
11	Powers-of-Attorney Act, 1882			Yes
12	Suits Valuation Act, 1887			Yes
13	Partition Act, 1893			Yes
14	Indian Stamp Act, 1899	Yes		Yes
15	Registration Act, 1908	Yes
16	Presidency Towns Insolvency Act, 1909			Yes
17	Provincial Insolvency Act, 1920	Yes		Yes
18	Parsi Marriage and Divorce Act, 1936			Yes
19	Indian Carriage of Goods by Sea Act, 1925			Yes
20	Commercial Documents Evidence Act, 1939			Yes
21	Indian Evidence Act, 1872	Yes	Yes

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[1] There are for instance, several legislations mimicking the preambulatory language found in the ICA and IEA respectively. See the Indian Trusts Act, 1882 and the Indian Stamp Act, 1899 for instance. While it is out of the scope of this piece, there is an argument to be made (depending on the legislative history of some of these legislations) that the preambulatory language provided a similar clue about their operation as complete codes. Attached in the annexure is a table classifying all colonial legislations by the preambular phrase used.

[2] As the piece will subsequently show, it is of historical significance that JF Stephens was not responsible for drafting the ICA from scratch. He was however, the sole drafter of the IEA. We suggest that this divergence played a significant role in the manner in which these legislations were intended to operate.

[3] See Footnote 4 for an important caveat regarding the savings clause.

[4] We issue an important caveat about the savings clause. We do not think that the phrase ‘incident of contract’ in s.1 (savings) broadly allows importing all common law principles dealing with contractual principles. The Privy Council in Irrawaddy thought that the common carrier’s duty under common law was ‘undoubtedly’ an incident of contract, without further elaboration. There is scant literature or judicial interpretation of this phrase, which could make it an unruly horse unless tightly restrained. One may potentially argue that ‘incident of contract’ should be read in the context of the preceding words in the provision—local usages and customs—using the doctrine of ‘noscitus a sociis’, meaning that a word is known by the company it keeps. In any case, the overarching point is that incident of contract should not be interpreted so that the ICA’s rules become redundant or get thrown into disarray by introducing common law principles, as was the case with s.74.

[5] The Indian Contract Act 1872, s.219. “219.When agent’s remuneration becomes due.—In the absence of any special contract, payment for the performance of any act is not due to the agent until the completion of such act…”

[6] Interestingly, he also uses the IEA as an example to show how exhaustive these legislations were. “The Indian Evidence Act which also we owe to the same eminent jurist has been universally praised for its thorough grasp of the principles of the Law relating to Evidence and for the exhaustive and clear manner in which such principles have been applied in the enactment of the rules of evidence embodied in the Act.” While we agree with him in principle – we show that the IEA was in a sense, far more exhaustive than the ICA.

[7] The Third Law Commission consisted of six members, of whom a few had resigned for reasons which are not immediately relevant to this post. For more, see MP Jain, Outlines of Indian Legal History (1972).

[8] See Kunal Ambasta, ‘One Hundred (and Fifty) Years of Solitude: The Indian Evidence Act 1872 as a Lost Project of Law Reform’ (2023) Indian Law Review 1,13. Professor Ambasta recognises two other such instances : Queen Empress v Abdullah (1885) ILR 7 All 385 (High Court of Allahabad) and Maharashtra v Kamal Ahmed Mohammed Vakil Ansari (2013) 12 SCC 17 (Supreme Court of India). Besides Musheer Khan (cited in the piece), we identify another: Emperor vs Manchankhan (1923) 09 Bom CK 0010, holding: The Indian Evidence Act follows a different method, as is pointed out by Mahmood J. in Queen-Empress v. Abdullah (1885) I.L.R. 7 All 385, 408, F. B.; and Sections 13 and 18 to 21 may be cited as other cases where statements by deceased persons are admissible, apart from Section 82.