Generally, a Central Law becomes operative on the day the President signs it. In
a similar vein, a State Law takes effect the day the Governor signs it. The
commencement of a statute designates the day the law officially goes into force,
while the operation of a statute is the process by which a law is put into
action. Statutes can operate in two ways: prospectively, to regulate events and
activities that are occurring right now, or retrospectively, to regulate
previous deeds and events that may affect an obligation or right that already
exists.
"Retrospective operation of law" refers to the application of a legal provision
to events or situations that occurred before the relevant statute was enacted.
The legal ramifications of acts taken prior to the passage of these laws are
modified or changed. A retroactive law creates or imposes a new liability for an
act done before the law's introduction, which eliminates or diminishes an
existing entitlement. Nevertheless, the law does not apply retroactively to
punitive provisions. The broad norm of prospective operation of law, which
governs future activities without changing the nature of past transactions
carried out in reliance on the then-applicable law, is broken by retrospective
laws.
The Indian Constitution forbids the retrospective implementation of an Act or a
law, unless the statute expressly states that it is retrospective in character.
If a law is implemented retroactively and isn't mentioned by the Act explicitly,
it will be considered unlawful or unconstitutional. The Indian constitution's
Article 20 (1) shields citizens against ex post facto law, sometimes referred to
as retrospective operation of the law, which modifies the legal ramifications of
decisions made before the law's passage. The question that arises during the
application of retrospectivity is whether a statute or law that creates a new
responsibility or eliminates or degrades an existing entitlement should be given
a retrospective impact.
Research Questions:
-
Constitutional Constraints on Retrospective Legislation in India:
Investigate the boundaries set by the Indian Constitution regarding retrospective laws, particularly focusing on Articles 20(1) and 21.
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Impact on Legal Certainty:
Assess how retrospective statutes impact legal certainty and the rule of law in India, considering the implications for businesses and individual rights.
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Judicial Responses to Retrospective Application:
Examine key judgments by the Supreme Court of India dealing with retrospective laws, such as in the cases of taxation, criminal law, and administrative decisions.
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Comparative Study of Retrospective Laws in India vs. Other Democracies:
Contrast how retrospective legislation is handled in India with practices in other democratic countries, identifying lessons and best practices.
Objective of the Study:
Analyze constitutional restrictions on retrospective legislation in India and their implications for fundamental rights.
Statement of Research Problem:
The retrospective application of statutes in India presents complex legal and ethical issues, particularly concerning fundamental rights and legal predictability. This research seeks to address the gap in understanding the constitutional constraints, judicial responses, and the broader implications of such laws on individuals and businesses. By examining the practical outcomes and judicial interpretations, the study aims to evaluate the fairness and impact of retrospective legislation, contributing to informed debates and guiding potential legislative reforms in India.
Hypothesis:
- The retrospective application of statutes in India adversely affects legal certainty and undermines public confidence in the legal system.
- Judicial scrutiny moderates the impact of retrospective laws, ensuring they align with constitutional provisions and fundamental rights.
Research Methodology:
A mixed research approach is applied to study the subject at hand and develop a deeper and more thorough understanding of this topic. This study combines descriptive and analytical research.
Scope and Limitation of the Study:
The scope of this study on the "Retrospective Application of Statutes" focuses on analyzing constitutional provisions, judicial interpretations, and their practical implications in India, alongside a comparative international perspective. The research aims to explore the impact on legal certainty and individual and business rights. However, the study faces limitations such as the availability of comprehensive legal judgments, regional variability in legal applications, and potential biases in judicial interpretation. Additionally, the evolving nature of legal frameworks may affect the study's long-term relevance and findings.
Chapterisation:
The research paper is organized into nine chapters. Chapter I, labelled
Introduction, offers a summary of the issue and the complete study technique,
hypothesis, research question, and so on. Chapter II discusses the meaning and
definition of retrospectives. Chapter III discussed the Constitutional
Framework. Chapter IV discussed the General Application of Retrospective
Operation of Statutes. Chapter V discussed the Principles Derived from Judicial
Interpretations. Chapter VI discussed the Examples of retrospective Laws in
India. Chapter VII discussed the Landmark Case Laws. Chapter VIII discusses the
Applicability of the retrospective operation of statutes in different
Democracies. Chapter IX gives the Conclusion and Suggestions.
Meaning And Definition Of The Word "Retrospective"
As stated in the introductory part, the law applies in two ways: retrospective
and prospective. The literal meaning of the word "retrospective" is "directed to
the past; contemplative of past situations, events, etc. looking or directed
backward, retroactive, as a statute." [1] Retrospective Laws are laws passed
today, that change what was legal or illegal yesterday. In other words, they are
made ex post facto � after the fact � to change what people's rights and
responsibilities were in the past.[2]
The literal meaning of the word
"retrospective legislation" is "Legislation that operates on matters taking
place before its enactment, e.g. by penalizing conduct that was lawful when it
occurred."[3] The meaning of retrospective law was elaborated in the case of
State Bank's Staff Union (Madras Circle) v. Union of India.[4]
While referring
to enactment, it was noted that the word "retrospective" could refer to several
different things, including altering an existing contract, reopening a
previously closed transaction, altering accrued rights and remedies, or altering
a procedure. A retrospective law takes away or otherwise affects vested rights
that have been acquired under existing laws, or it creates new obligations,
imposes new duties, or attaches new disabilities to past transactions or
considerations.[5]
In
Zile Singh v. State of Haryana,[6] it was observed that it is a fundamental
rule of construction that every statute is prima facie prospective unless it is
made to have retrospective application expressly or by necessary implication.
However, the general rule is applicable whenever the main objective of a statute
is to affect vested rights, impose new burdens, or undermine existing
obligations. Unless the statute expressly states that the legislature intended
for it to affect pre-existing rights, it is assumed to be prospective only.
So, the word "retrospective" has considerable importance in legal language, that
is why it was discussed by higher in many cases.
Constitutional Framework
Article 20 (1) "No person shall be convicted of any offense except for violation
of a law in force at the time of the commission of the Act charged as an
offense, nor be subjected to a penalty greater than that which might have been
inflicted under the law in force at the time of the commission of the
offense."[7]
While retrospective legislation operates retroactively, a prospective law
establishes rights and duties for the parties ensuing in the future. It is
referred to as ex post facto law in the constitution. Generally speaking, unless
the laws specifically state otherwise, any new legislation or amendment is
always regarded as prospective. The Indian constitution's Article 20(1)
restricts the creation of retroactive criminal laws.
According to the article, a person cannot be tried or found guilty twice for the
same crime; rather, a person can only be found guilty if they have broken an
existing law. A new statute that criminalizes certain behaviors does not mean
that an act done by someone in the past is an offense. Additionally, the clause
prohibits an accused party accused of any offense from subsequently facing a
harsher punishment. Nonetheless, the appropriate inference in the legal system
is the beneficial construction of a statute. The following law will be applied
retroactively for the benefit of individuals if the goal of the retrospective
law is to lessen the studious penalty for an infraction. Nonetheless, our legal
system permits and recognizes retroactive legislation that creates civil
liability for actions taken in the past.[8]
General Application of Retrospective Application of Statutes
Substantive laws: Retrospective laws are typically used in a nation to change
the severity of a given crime's punishment. They might be sentenced to a shorter
term by being put into a more serious category or having the crime's punishment
reduced. However, how different laws are treated about retroactive laws also
differs. Only laws that impact people's substantive rights are eligible for a
retrospective operation, which allows them to be applied to previous
occurrences. For instance, an act considered punished two years ago by the court
is no longer considered a crime with retroactive effect. The individual would be
released and it would apply to him.[9]
Procedural laws: The aforementioned, however, does not apply to procedural
legislation. Generally speaking, procedural laws function in prospective rather
than retrospectively. The Act substantially diminishes certain vested rights
while introducing a new duty or transaction due to its retroactive
implementation. Therefore, only substantive laws are subject to the
retrospective operation of laws; procedural laws are not.
Principles Derived from Judicial Interpretations
Retrospective application of statutes, a concept deeply rooted in legal systems
worldwide, holds significant implications for justice, fairness, and legal
certainty. In India, the principles governing retrospective application have
been subject to extensive judicial scrutiny and legislative deliberation.
- Presumption against Retroactivity:
In Indian jurisprudence, there exists a strong presumption against retroactive application of statutes. This presumption is rooted in principles of fairness, legal certainty, and the protection of vested rights. Courts have consistently upheld this presumption, emphasizing the need for clear legislative intent to justify retroactive application.[10]
In State of Punjab v. Amar Nath Chawla (1980), the Supreme Court of India
reiterated the principle that statutes should be prospective unless there is
clear and express language indicating retrospective application. The court held
that retroactive legislation should be the exception rather than the rule, and
any ambiguity in legislative intent should be resolved in favor of prospective
operation.
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- Exceptions to the Presumption:
While the presumption against retroactivity is strong, Indian courts recognize certain exceptions where statutes may be applied retrospectively. These exceptions are typically based on legislative intent, necessity, or considerations of justice.
In Union of India v. V.K. Sharma (1990),[11] the Supreme Court considered the
retrospective application of a statute aimed at providing relief to victims of
wrongful detention. Despite the absence of explicit retroactive language in the
statute, the court held that the legislative intent to provide relief to the
aggrieved parties justified its retrospective application.
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- Legislative Intent and Equitable Consideration:
Determining the retroactive effect of statutes often involves an examination of legislative intent and equitable considerations. Indian courts interpret statutes in light of their purpose, context, and effect on rights and obligations. Equitable considerations, such as fairness and justice, play a crucial role in assessing the retroactive application of laws.
In Commissioner of Income Tax v. Vatika Township Pvt. Ltd. (2015),[12] the
Supreme Court analyzed the retrospective amendment of tax laws affecting real
estate transactions. The court emphasized that while legislative intent was
crucial, equitable considerations, such as protecting legitimate expectations
and avoiding undue hardship, must also be taken into account when applying
statutes retroactively.
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- Constitutional Constraint:
The retrospective application of statutes in India is subject to constitutional constraints, particularly regarding fundamental rights and principles of justice. Any retroactive law that impairs vested rights or violates constitutional guarantees may be struck down by the courts as unconstitutional.
In Indira Nehru Gandhi v. Raj Narain (1975),[13] the Supreme Court examined the
constitutional validity of retrospective amendments to election laws. The court
emphasized that retroactive legislation must not infringe upon the fundamental
rights enshrined in the Constitution, including the right to equality and the
right to a fair trial.
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- Clarity of Constitutional constraints:
In determining the retroactive effect of statutes, Indian courts closely scrutinize the clarity of legislative intent. Unambiguous language indicating retrospective application is crucial to overcome the presumption against retroactivity.
P. Kasilingam v. PSG College of Technology (1980) [14] The Supreme Court held
that where the language of a statute is explicit and unequivocal in expressing
retroactive intent, courts must give effect to such intent, even if it results
in retrospective application. However, in the absence of clear legislative
language, the presumption against retroactivity prevails.
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- Impact on Substantive Rights:
The retroactive application of statutes may significantly impact substantive rights, including contractual rights, property rights, and civil liberties. Indian courts assess the retroactive effect of statutes by considering their impact on vested rights and legitimate expectations.
K.S. Paripoornan v. State of Kerala (2007)[15] - The Kerala High Court examined
the retrospective application of a statute affecting property rights. The court
emphasized that retroactive laws must not unfairly deprive individuals of their
vested rights or disturb settled legal expectations, particularly in matters
involving property.
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- Avoidance of Arbitrary and Discriminatory Application:
Retroactive statutes should be applied consistently and without arbitrariness or discrimination. Indian courts ensure that retroactive laws do not unfairly target specific individuals or groups, but instead serve legitimate public purposes.
Manohar Lal Sharma v. Principal Secretary (2014)[16] - The Delhi High Court
reviewed the retrospective application of a law imposing restrictions on the
sale of fireworks. The court emphasized the importance of ensuring that
retroactive measures serve a valid public interest and are not arbitrarily
applied to disadvantage-specific stakeholders.
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- Balancing Retroactive Justice with Legal Certainty:
While retroactive laws may serve the interests of justice in certain cases,
Indian courts strive to balance retroactive justice with the need for legal
certainty and stability in the legal system. Courts consider the potential
disruptive effects of retroactive application on settled legal expectations and
commercial transactions.
Raval & Co. v. K.G. Ramachandran (1974)[17]:
The Supreme Court emphasized that
while courts may uphold retroactive laws in the interest of justice, they must
also consider the need for legal certainty and predictability in commercial
transactions. Retroactive measures should not unduly disrupt established
contractual rights or business practices.
Examples of retrospective Laws in India
In India, there are several instances of retroactive statutes. Several more laws
have been introduced in India, even though the majority of these laws deal with
taxes.
The Karnataka Scheduled Caste and Scheduled Tribe (Prohibition of Transfer of
Certain Lands) Act, 1978,[18] this act had a retroactive character. The purpose
of this Act was to make it illegal for members of the Scheduled Castes and
Scheduled Tribes to receive land grants from the government. Before the
legislation's adoption, this regulation also applied to land owned by Scheduled
Tribes and Scheduled Castes. Not even the members of the SC and ST groups were
permitted to buy the property they owned.
The Tamil Nadu Land Acquisition (Revival of Operation, Amendment, and
Validation) Act, 2019,[19] the constitutionality of this act was recently
affirmed by the Supreme Court and would be implemented retroactively until 2013.
The Supreme Court rationalized its ruling by stating that safeguarding the
general public interest is the legislature's fundamental duty. The legislature
is in charge of defending citizens' rights and making sure there is a democratic
political system in place. Therefore, any action taken to accomplish this goal
is regarded as constitutional, and the petitioner's argument that it did not
adhere to the separation of powers principle is wholly unfounded. Any
legislation that does not explicitly forbid something can be applied
retroactively for the benefit of the public without experiencing any
repercussions.
Landmark Case Laws:
In many cases, the Courts of law dealt with the matter regarding the
retrospective application of statutes, not only in India but outside of India
too.
Calder v. Bull (1798)[20]:
In this landmark case, the Supreme Court of the United States grappled with the
question of whether the Connecticut legislature's decision to revive an already
adjudicated claim violated the ex post facto clause of the U.S. Constitution.
The Court held that retroactive laws could not be applied to impair vested
rights or disturb final judgments. This case laid the foundation for the
principle that retroactive laws should not infringe upon fundamental rights or
upset settled expectations.
Landgraf v. USI Film Products (1994)[21]:
The U.S. Supreme Court in this case outlined a two-step test for determining
whether a statute should apply retrospectively. First, courts must ascertain
whether Congress expressly stated the statute's temporal reach. Second, absent
clear congressional intent, courts must consider whether the retroactive
application would have a substantive impact on rights, liabilities, or duties.
This case underscores the importance of legislative intent and the need to
balance fairness and predictability in applying laws retroactively.
Golaknath v. State of Punjab (1967)[22]:
In this landmark case, the Supreme Court of India ruled on the Parliament's
power to amend fundamental rights guaranteed by the Constitution retroactively.
The Court held that fundamental rights could not be abridged or taken away by
constitutional amendments, whether prospective or retrospective. This case led
to the 24th Amendment Act of 1971, which explicitly granted Parliament the power
to amend any part of the Constitution, including fundamental rights, without any
limitations regarding retroactive effect.
Keshavananda Bharati v. State of Kerala (1973)[23]:
While not directly addressing the retrospective application of statutes, this
case is significant for establishing the doctrine of the basic structure of the
Constitution. The Supreme Court held that Parliament's power to amend the
Constitution was not unlimited and could not alter its basic structure. This
decision indirectly influenced future cases involving retrospective application
of statutes by affirming the supremacy of the Constitution and its core
principles.
Baijnath Kedia v. CIT (1971)[24]:
In this case, the Supreme Court laid down the principle that a statute could be
applied retrospectively if it merely clarifies the existing law without altering
its substance. The Court held that if a statute is declaratory of the previous
law, it can have retrospective operation, but if it changes the previous law, it
will operate prospectively unless there is a clear intention to give it
retrospective effect.
G.V. Venkataswami Naidu & Co. v. CIT (1959)[25]:
This case established the principle that a statute cannot be given retrospective
operation to impose a new liability or take away an existing one unless such
intention is clearly expressed or necessarily implied. The Court emphasized the
importance of legislative intent in determining the retrospective application of
statutes.
R.C. Jall v. Union of India (1994)[26]:
In this case, the Supreme Court held that retrospective amendments to tax laws
must be interpreted strictly. The Court stated that when a statute is
unambiguous, there is no room for interpretation, and the intention of the
legislature must be gathered from the language of the statute. This case
underscores the principle that retrospective taxation should be subject to
strict scrutiny to avoid arbitrariness.
M.P. Varghese v. ITO (1981)[27]:
Here, the Supreme Court clarified that a statute cannot be construed
retrospectively if it takes away or abridges vested rights acquired under
existing laws. The Court emphasized that the legislature cannot be presumed to
have intended to take away vested rights except by express enactment or
necessary implication.
M.P. Sugar Mills v. State of U.P. (1980)[28]:
This case dealt with the retrospective application of a sales tax amendment. The
Supreme Court held that retrospective operation of a statute is not favored,
especially when it affects substantive rights. The Court stated that unless
there is express provision or necessary intendment, a statute should not be
given retrospective effect to the prejudice of a substantive right.
These cases guide the principles governing the retrospective application of
statutes in India, emphasizing the importance of legislative intent, clarity of
language, and protection of vested rights. They underscore the need for caution
and scrutiny when considering retrospective legislation to ensure fairness and
legal certainty.
Applicability of retrospective operation of statutes in different Democracies
- United Kingdom (UK): In English law, there is an assumption that statutes do not have a retroactive effect unless expressly specified. However, there is no reason to prevent the implementation of legislation if it has a clear intention to be applied retroactively. The Wireless Telegraph (Validation of Charges) Act of 1954 serves as an illustration of this, as it established the legal framework for the wireless licensing payments that have been collected throughout the past fifty years. The Supreme Court made it quite evident in the Walker v. Innospec Ltd. and Ors., 2017 ruling that any statute will be prospective in nature unless the express purpose of the Court is otherwise indicated.
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- Australia: In Australia, rules that relate to previous events can be made retroactively by both state and federal governments. But in Australia, this has consistently been challenged for being against the law. This is the case because everyone must be aware of the law for them to be able to abide by it, according to the Australian concept of the rule of law. The first challenge to the retrospective operation was made in the case of R v Kidman (1915). Nonetheless, the High Court held in this case that while the Constitution restricts the authority of the Australian Parliament, neither the State Legislatures nor the Parliament are restricted in their ability to enact retroactive laws.
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- France: Article 2 of the Napoleonic Code, often known as the Code Civil, outlawed the creation of ex post facto laws in France. The fundamental argument made in this article is that legislation shouldn't be retrospective; rather, it should only consider the future. One of France's highest authorities, the Constitutional Council, eventually decided that retroactive laws can be implemented as long as they didn't go beyond a certain point. Like in India, the council usually also introduces retroactive tax regulations. The penalties outlined in ex-post facto laws are still forbidden in criminal law, except in situations in which the offender stands to gain from the legislation.
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- United States of America (USA): It is forbidden for Congress in the United States to enact any legislation after the fact. This is one of the relatively few limitations placed on the federal and state governments by the United States of America Constitution. The Court considered the four types of invalid ex-post facto statutes in the Calder v. Bull (1798) ruling, which it used while making its decisions about ex-post facto cases. That being said, the prohibition against ex post facto laws has not always held true. The Adam Walsh Child Protection and Safety Act, which was introduced in 2006, established new registration requirements for sex offenders who had been found guilty of such crimes as well as those who had committed them in the past.
Conclusion and Suggestions
This research paper on the "Retrospective Application of Statutes" in India
concludes that while retrospective laws can sometimes be necessary for justice
or administrative convenience, they often pose significant challenges to the
principles of legal certainty and predictability. The analysis reveals that such
statutes can undermine public trust in the legal system and adversely affect
individual and business planning. Judicial review has proven to be a crucial
mechanism in safeguarding constitutional guarantees against arbitrary
retrospective legislation. However, inconsistencies in judicial decisions and
the broad discretionary powers sometimes exercised by the legislature highlight
the need for more stringent safeguards.
- Clear Legislative Guidelines: The Indian legislature should establish clearer guidelines for when and how retrospective laws can be enacted, possibly including a requirement for a supermajority in Parliament for their passage to ensure broader consensus.
- Enhanced Judicial Scrutiny: The judiciary should maintain rigorous scrutiny of retrospective laws to ensure they meet strict criteria of public interest and necessity while adhering closely to constitutional principles.
- Public Consultation: Before passing any retrospective legislation, a mandatory public consultation process should be implemented to gather input from potentially affected parties and to enhance transparency.
- Legal Certainty Principle: Introduce a principle of legal certainty in the legislative process, wherein laws that significantly alter previous understandings or agreements are avoided unless necessary.
- Periodic Review Mechanism: Establish a mechanism for the periodic review of the impact of retrospective laws, allowing for adjustments or repeals based on real-world impacts and feedback.
By implementing these suggestions, the Indian legal system could better balance the need for legislative flexibility with the principles of fairness, certainty, and trust in the rule of law.
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End-Notes:
- Retrospective, available at: https://www.dictionary.com/browse/retrospective (last visited on April 20, 2024).
- Retrospective Laws, available at: https://www.ruleoflaw.org.au/principles/retrospective-laws (last visited on April 20, 2024).
- Retrospective Legislation, available at: https://www.oxfordreference.com/display/10.1093/oi/authority.20110803100417142 (last visited on April 21, 2024).
- AIR 2005 SC 3446.
- Principles Relating To Retrospective Operation Of Statutes, available at: https://www.brillopedia.net/post/principles-relating-to-retrospective-operation-of-statutes (last visited on April 22, 2024).
- AIR 2004 SC 5100.
- The Constitution of India, art. 20(1).
- Applicability Of Retrospective Laws In India, available at: https://www.brainboosterarticles.com/post/applicability-of-retrospective-laws-in-india (last visited on April 23, 2024).
- Retrospective operation of statutes, available at: https://blog.ipleaders.in/retrospective-operation-of-statutes/#General_application_of_retrospective_operation_of_statutes (last visited on April 24, 2024).
- Principles Relating To Retrospective Operation Of Statutes, available at: https://www.brillopedia.net/post/principles-relating-to-retrospective-operation-of-statutes (last visited on May 1, 2024).
- AIR 1990 SC 32.
- AIR 2015 SC 1.
- AIR 1975 SC 2299.
- 1995 AIR SC 1395.
- AIR 1995 SC 1012.
- AIR 2014 SC 514.
- AIR 1974 SC 818.
- The Karnataka Scheduled Castes And Scheduled Tribes (Prohibition Of Transfer Of Certain Lands) ACT, 1978, available at: https://www.indiacode.nic.in/bitstream/123456789/7812/1/2_of_1979_%28e%29.pdf (last visited on April 24, 2024).
- Tamil Nadu Government Gazette Extraordinary, available at: http://www.stationeryprinting.tn.gov.in/extraordinary/2019/451_Ex_IV_2.pdf (last visited on April 25, 2024).
- Calder v. Bull, 3 U.S. (3 Dall.) 386 (1798).
- United States v. Detroit Lumber Co., 200 U.S. 321, 337.
- AIR 1967 SC 1643.
- AIR 1973 SC 1461.
- AIR 1970 SC 1436.
- AIR 1959 SC 359.
- AIR 1962 SC 1281.
- AIR 1981 SC 1922.
- AIR 1979 SC 621.
Written By:
- Abubakar Shamsi (B.A. LL.B (Hons.), 5th Semester - Jamia Millia
Islamia, New Delhi, 110025
- Rushed Ali (B.A. LL.B (HONS.), 5th Semester - Jamia Millia
Islamia, New Delhi, 110025
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