Kasturilal v. State of U.P 1965 (Case Summary)

This case is a landmark decision in Indian tort law that upheld the doctrine of sovereign immunity, ruling that the State is not liable for wrongful acts committed by its employees during the performance of sovereign functions.

Facts of Kasturilal v. State of U.P.

1. Kasturilal, a businessman, was carrying gold and other valuable goods when he was arrested by the police on suspicion of possessing stolen property. 
2. The gold was seized and stored in the police custody in Meerut.
3. When Kasturilal was released, the gold was not returned because a police constable had misappropriated it and fled. 
4. Kasturilal sued the state of Uttar Pradesh, claiming compensation for the loss caused by the negligence of its employees.

Issues framed

1. Whether the State can be held liable for the wrongful acts of its employees performed during the course of sovereign functions?
2. Whether the doctrine of sovereign immunity exempt the State from liability in such cases?

Subordinate Court Judgment

The trial court ruled in favor of Kasturi Lal, holding the State liable for the negligence of its police officer (Employee). The court awarded damages to the plaintiff, considering the negligence of the police officers as actionable under the law.

The Allahabad High Court overturned the Civil Judge’s ruling, holding that the State was not liable for the loss, as the actions of the police officers were performed in the exercise of sovereign functions. Consequently, the suit was dismissed.

The Plaintiff being aggrieved by the High Court order appealed to the Hon’ble Supreme Court of India. 

Judgment of Kasturilal v. State of U.P. 

The Hon’ble Supreme Court analyzed the doctrine of sovereign immunity as derived from English Common Law and its applications in India. 

The Court held that the act of taking property into custody by the police was a sovereign function of the state. The judgment drew a distinction between sovereign and non sovereign functions, holding that sovereign immunity applied only to the former.

The Supreme Court dismissed Kasturilal’s claim upholding the High Court’s decision. The court stated that for the acts done in exercise of sovereign functions, the State is not liable for the negligence or wrongful acts of its employees.  

Refer to the Judgment below.