Administrative Law Project
On
Lachmi Narayan v. Union of India: Case Analysis
Submitted to:
Dr. Kaumudhi Challa
Faculty of Administrative Law
Submitted by:
Tanmay Meshram
Roll no.
Semester VI, Section C
B.A. LLB (Hons.)
Submitted on:
February 15, 2016
HIDAYATULLAH NATIONAL LAW UNIVERSITY
Uparwara Post, Abhanpur, New Raipur (C.G.) 492002
i
Declaration of Originality
I, Tanmay Meshram , have undergone research of the project work titled Lachmi Narayan vs.
Union Of India: Case Analysis, as a student of Administrative Law. I hereby declare that this
Research Project has been prepared by the student for academic purpose only, and is the outcome
of the investigation done by me and also prepared by myself under the supervision of Dr.
Kaumudhi Challa, Faculty of Administrative Law, Hidayatullah National Law University,
Raipur. The views expressed in the report are personal to the student and do not reflect the views
of any authority or any other person, and do not bind the statute in any manner.
I also declare that this Research Paper or any part, thereof has not been or is not being submitted
elsewhere for the award of any degree or Diploma. This report is the intellectual property of the
on the part of student research work, and the same or any part thereof may not be used in any
manner whatsoever in writing.
Tanmay Meshram
Roll. No.
Semester VI, Section C
ii
Certificate of Originality
This is to certify that Mr. Tanmay Meshram , Roll Number , student of Semester VI, Section C
of [Link].B.(Hons.), Hidayatullah National Law University, New Raipur (Chhattisgarh) has
undergone research of the project work titled Lachmi Narayan vs. Union Of India: Case
Analysis , in partial fulfillment of the subject of Administrative Law. His performance in
research work is up to the level.
Place: New Raipur
Date: 15.02.2016 [Link] Challa.
(Faculty- Administrative Law)
Hidayatullah National Law University, New Raipur, Chhattisgarh
iii
Acknowledgement
I feel highly elated to work on the project Lachmi Narayan vs. Union Of India: Case
Analysis . The practical realisation of the project has obligated the assistance of many persons.
Firstly I express my deepest gratitude towards Dr. Kaumudhi Challa, Faculty of Administrative
Law, to provide me with the opportunity to work on this project. Her able guidance and
supervision in terms of her lectures were of extreme help in understanding and carrying out the
nuances of this project.
I would also like to thank The University and the Vice Chancellor for providing extensive
database resources in the library and for the internet facilities provided by the University.
Some typography or printing errors might have crept in, which are deeply regretted. I would be
grateful to receive comments and suggestions to further improve this project.
Tanmay Meshram
Roll. No.
Semester VI, Section C
iv
Table of Cases
Foreign Judgments:
1. Bailey v. Williamson, (1873) 8 QB 118 (LR).
2. R. v. Sheer Metalcraft, (1954) 1 QB 586.
Indian Judgments:
1. Atlas Cycle Industries Ltd. v. State of Haryana, AIR 1979 SC 1149.
2. Avinder Singh v. State of Punjab, AIR 1979 SC 321.
3. Dal-Ichi Karkaria Ltd. v. Union of India, AIR 2000 SC 1741.
4. Express Newspaper (P) Ltd. v. Union of India, AIR 1958 SC 578.
5. Queen v. Burah, 1878) 5 I.A. 178
6. Re: Delhi Laws case, [1951] S.C.R. 747
7. Sikkim v. Surendra Sharma, (1994) 5 SCC 282
v
List of Abbreviations
1. & And
2. Ed. Edition
3. Ltd. Limited
4. No. Number
5. Sec. Section
6. UK United kingdom
7. USA United States of America
8. V. Versus
vi
Table of Contents
1. Declaration i
2. Certificate of Originality ii
3. Acknowledgement iii
4. Table of Cases iv
5. List of Abbreviations v
6. Introduction 1
7. Research Methodology 3
7.1. Problem of the Study 3
7.2. Rationale 3
7.3. Hypothesis 3
7.4. Objectives 4
7.5. Review of Literature 4
7.6. Nature of Study 5
7.7. Limitations 5
7.8. Chapterization 5
8. Delegated Legislation: Control in USA and UK 7
9. Delegated Legislation: Control in India 9
10. Modes of Parliamentary Control 11
10.1. At the time of Delegating 11
10.2. Laying 11
10.3. Scrutiny Committees 14
11. Judicial Approach 19
12. Conclusion 21
13. Suggestions 23
14. Bibliography 25
1
Chapter I: Introduction
Growth of Administrative Process bulk of law comes from the administrators. All law making
which takes place outside the legislature expressed as rules, regulations, bylaws, orders,
schemes, directions or notifications etc. Art. 13 (3) Defines law and it Includes ordinance, order,
byelaw, rule, regulation & notification having the force of law.
In Sikkim v. Surendra Sharma1 - All Laws in force is sub clause (k) of Art. 371 F includes
subordinate legislation
Salmond defined delegated legislation as that which proceeds from any authority other than the
Sovereign power & is therefore, dependent for its continued existence & validity on some
superior or supreme authority
Central law to central or state or both subject to subject matters (appropriate Govt.), e.g.: -
Industrial disputer Act, 1947 center power of rule making on the appropriate Govt.
Difference between rules, regulation & bylaws: Generally, the statutes provide for power to
make rules where the general policy has been specified in the statute but the details have been
left to be specified by the rules. Usually, technical or after matters, which do not affect the policy
of the legislation, are included in regulations. Bylaws are usually matter or local importance, and
the power to make byelaws is generally given to the local or self-governing authority
1
(1994) 5 SCC 282
2
Research Methodology
Problem of the Study
Though Subordinate Legislation is now universally accepted as inevitable and indispensable, it
is generally agreed that the tendency to delegate to the Executive the legislative powers is
dangerous. Political scientists and others interested in the subject have felt that the concerned
departments or the authorities, to whom the ancillary legislative powers have been delegated,
regulate matters of substantive nature which may closely affect the rights and interests of the
citizens. In certain circumstances, the setup is taken for granted and the legislations are modified
and adapted as the authorities wish leading to infringement of limit to the powers the delegate are
provided with. Therefore, it is necessary to have a mechanism to control the acts of
administrative authorities which they perform through delegated legislation.
Rationale
As a result of increase in rule making power by administrative authority, two pertinent questions
crop up. First, how much power should be delegated by the Legislature to the subordinate
authorities? And second, what restraints or safeguards should be imposed upon the authorities
exercising delegated legislative powers? Today, the problem is not about the desirability or
otherwise of delegated legislation but it is with regard to the control and safeguards which can be
introduced to ensure effective parliamentary control over subordinate legislation so that the
powers conferred are not abused or misapplied. This project attempts to answer the second
question.
Hypothesis
Parliament has prima facie, an inherent right to see that the powers delegated by it to make rules,
sub-rules, regulations, bye-laws, etc., have been exercised in harmony with the terms of the
statute delegating such powers and also that they are in accordance with the general principles of
delegation. It has also the duty to supervise that the power to accustomize and adapt the
provisions are properly exercised by the Executive.
3
Objectives
The objectives of this project are:
1. To study in detail the case of Lachmi Narayan Vs. Union of India.
2. To understand the facts of the case.
3. To analyze the main law point that is discussed in the case.
4. To understand the approach of judiciary in the given case and comment on it.
Review of Literature
1. Lachmi Narayan vs. Union of India
1976 AIR 714, 1976 SCR (2) 785
2. Ramesh Narain Mathur, Legislative Control of Delegated Legislation A Survey, The
Indian Journal of Political Science, Vol. 21, No. 1, (JanuaryMarch, 1960):
This Research article written by Ramesh Narain Mathur beautifully summarises the
control of parliament over delegated legislation in India along with the scenarios in other
countries such as Australia, USA, UK and Canada.
3. Rajya Sabha Practice & Procedure Series, Committee on Subordinate Legislation,
[Link] (Accessed on
February 7, 2016):
This report presented by Rajya Sabha includes the role of Rajya Sabha Committee on
Subordinate Legislation in controlling delegated legislation and also provides the
constitution and functions of the Committee.
Nature of Study
The nature of the study in this project is doctrinal and is primarily descriptive and analytical.
This project is largely based on primary sources of data such as cases and reports of committees,
however secondary & electronic sources of data have been referred to a great extent. Books, case
laws, journals & other reference as guided by faculty of Administrative Law are primarily used
for the completion of this project.
4
Limitations of the Study
Due to paucity of time and resources the author has dealt in brief the role of Parliamentary
control over delegated legislation in order that the executive do not misuse the power of
delegated legislation. The author has studied in detail the given case and related cases to
understand the concept of misuse of power to modify and adapt.
Chapterisation
This project has been divided into 5 chapters. Chapter 1 comprises of Introduction and Research
Methodology of the project. Chapter 2 includes the facts in brief of the given case. Chapter 3
comprises of the judgment held by the honble 3 judge bench in the given case. Chapter 4 deals
with the elaborate analysis of the judgment in reference to the power to modify and adapt.. At
last Chapter 6 concludes this project along with suggestions and references
5
Chapter II: BRIEF FACTS
Section 2 of the Part States (Laws) Act, 1950, empowered the Central Government to
extend by notification in the official gazette, to any Part C State, or to any part of it, with
such restrictions and modifications as it thinks fit, any enactment in force in a Part A State.
In 1951, the Central Government, in exercise of this power, extended by a Notification the
Bengal Finance (Sales Tax) Act, 1941, to the then Part State of Delhi with certain
modifications in s. 6. The section, after such extension with modifications, provided:
6(1) No tax shall be payable under this Act on the sale of goods specified in the first
column of the Schedule subject to the conditions etc: and (2) The State Government
[Amended as Central Government in 1956] after giving by notification in the official
gazette not less than 3 months notice of its intention to do so, may by like notification add
to or omit from or otherwise amend the Schedule and thereupon the Schedule shall he
amended accordingly A modified Schedule of goods exempted from tax under s.6 was also
substituted for the original Schedule in the Bengal Act, by the Notification.
After the passing of the States Reorganisation Act, 1956, the Part States (Laws) Act
became Union Territories (Laws) Act, 1950. with necessary adaptations.
In 1957, the Central Government issued a Notification in purported exercise of the powers
under s. 2 of the 1950Act, amending the 1951-Notification. By the 1957 Notification an
additional modification of s. 6 of the Bengal Act was introduced in the 1951-Notification,
namely the words such previous notice as it considers reasonable were substituted for
the words not less than 3 months' notice in s. 6(2).
In 1959, Parliament passed the Bengal (Sales Tax) (Delhi Amendment) Act, 1959, making
some amendments in various sections of the Bengal Act but left s. 6 untouched.
By various notifications, exemption from sales tax was granted to several commodities;
but subsequently, the exemption was withdrawn by other notifications after giving notice
of less than 3 months.
Dealers in those commodities, who were aggrieved by the withdrawal of the exemption,
challenged the validity of' the withdrawal. The High Court dismissed their petitions. On
the main ground that Parliament, while enacting the Amending Act of 1959, had put its
6
seal of approval to the curtailed period of notice in s. 6(2) and as such, it should be taken to
have keen provided by Parliament itself in the Bengal Act.
HELD
The honble three judge bench comprising of A.C. Gupta, R.S. Sarkaria and Y.V.
Chandrachud, JJ. held that the impugned notification dated December 7, 1957, purporting to
substitute the words "such previous notice as it considers reasonable" for the words "not less
than three months' notice" in Section 6(2) of the Bengal Act, is beyond the powers of the
Central Government conferred on it by Section 2 of the Laws Act. In consequence, the
notifications dated April 1, 1958, September 19, 1959, June 29, 1966, and July 31, 1970, in so
far as they withdrew the exemptions from tax in the case of durries, pure silk, country liquor,
kirayana articles, etc., without complying with the mandatory requirement of not less than
three months' notice enjoined by Section 6(2) of the Bengal Act, are also invalid and
ineffective.
ANALYSIS
The main legal issue discussed in the case is the extent of the power the power of the Govt. to
modify and adapt any legislation or statute.
Shri B. Sen, counsel on behalf of the Govt. contended that the power of modification given by
Section 2 of the Laws Act does not exhaust itself on first exercise; it can be exercised even
subsequently if through oversight or otherwise, at the time of extension of the enactment, the
Central Government fails to adapt or modify certain provisions of the extended enactment for
bringing it in accord with local conditions. In this connection support has been sought from the
observations of Fazl Ali, J., in Re: Delhi Laws Act2. He also invited attention to Section 21 of
the General Clauses Act, which, according to counsel, gives power to the Central Government
to add to, amend, vary or rescind any notification, etc., if the power to do so does not run
counter to the policy of the legislature or affect any change in its essential features.
2
[1951] 2 SCR 747 at 850
7
Learned Counsel further tried to support the reasoning of the appellate Bench of the High
Court, that whatever infirmity may have existed in the impugned notification and the
modification made thereby in Section 6(2), it was rectified and cured by Parliament when it
passed the Amendment Act 20 of 1959. It is urged that the Bengal Act together with the
modifications made by notifications dated April 28, 1951, and December 7, 1957, must have
been before Parliament when it considered and passed the Amendment Act of 1959. Our
attention has been invited to its preamble, which is to the effect: "An Act further to amend the
Bengal Finance (Sales Tax) Act, 1941, as in force in the Union Territory of Delhi", and also to
the words "as in force in the Union Territory of Delhi" in Section 2 of the amending Act.
Reference has been made to this Court's decisions in Venkatrao Esajirao's case3 and Gwalior
Rayon Silk Mfg. (Wvg.) Co. Ltd. v. Assistant Commissioner of Sales Tax4.
In Re: Delhi Laws5, this Court inter alia examined the Constitutional validity of Section 2 of
the Laws Act in the light of general principles relating to the nature, scope and limits of
delegated legislation.
The court by a majority held that the first part of this section which empowers the Central
Government to extend to any Part C State or to any part of such State with such modifications
and restrictions as it thinks fit any enactment which is in force in a Part A State, is intra vires,
and that the latter part of this section which empowers the Central Government to make
provision in any enactment extended to a Part C State, for repeal or amendment of any law
(other than a Central Act), which is for the time being applicable to that Part C State, is ultra
vires. Consequent upon this opinion, the latter part of the section was deleted by Section 3 of
the Repealing and Amending Act, 1952 (Act 48 of 1952), with effect from August 2, 1951.
The majority opinion in upholding the validity of the first portion of Section 2 of the Laws Act
drew a good deal from the observations of the Privy Council in Queen v. Burah6.
The bench, in regard to the argument that the power conferred by Section 2 of the Laws Act is
a power of "conditional" legislation and not a power of "delegated" legislation, said that: In
3
[1970] 1 SCR 317
4
[1974] 94 ITR 204 (SC)
5
[1951] S.C.R. 747
6
(1878) 5 I.A. 178
8
our opinion, no useful purpose will be served to pursue this line of argument because the
distinction propounded between the two categories of legislative powers makes no difference
in principle. In either case, the person to whom the power is entrusted can do nothing beyond
the limits which circumscribe the power; he has to act-to use the words of Lord Selborne-
"within the general scope of the affirmative words which give the power" and without
violating any "express conditions or restrictions by which that power is limited". There is no
magic in a name. Whether you call it the power of "conditional legislation" as Privy Council
called it in Burah's case7 or "ancillary legislation" as the Federal Court termed it in Choitram
v. Commissioner of Income-tax, Bihar8, or "subsidiary legislation", as Kania, C. J., styled it, or
whether you camouflage it under the veiling name of "administrative or quasi-legislative
power"-as Professor Cushman and other authorities have done it-necessary for bringing into
operation and effect an enactment, the fact remains that it has a content, howsoever small and
restricted, of the law-making power itself. There is ample authority in support of the
proposition that the power to extend and carry into operation an enactment with necessary
modifications and adaptations is in truth and reality in the nature of a power of delegated
legislation.
The bench then invited attention to the view of Mukherjea, J. in Re: Delhi Laws case9:
The word 'restrictions'...connotes limitation imposed upon a particular provision so as to
restrain its application or limit its scope. It does not by any means involve any change in the
principle. It seems to me that in the context and used along with the word 'restriction' the word
'modification' has been employed also in a cognate sense, and it does not involve any material
or substantial alteration. The dictionary meaning of the expression 'to modify' is to 'tone down'
or to 'soften the rigidity of the thing' or 'to make partial changes without any radical alteration'.
It would be quite reasonable to hold that the word 'modification' in Section 7 of the Delhi
Laws Act (which is almost identical with the present Section 2, Laws Act) means and signifies
changes of such character as are necessary to make the statute which is sought to be extended
suitable to the local conditions of the province. I do not think that the executive Government is
7
(1878) 5 I.A. 178
8
[1947] 15 I.T.R. 302 : [1947] F.C.R. 116
9
[1951] S.C.R. 747
9
entitled to change the whole nature or policy underlying any particular Act or to take different
portions from different statutes and prepare what has been described before us as 'amalgam' of
several laws...these things would be beyond the scope of the section itself.
The bench contended that the power of modification given by Section 2 of the Laws Act, does
not exhaust itself on first exercise; it can be exercised even subsequently if through oversight or
otherwise, at the time of extension of the enactment, the Central Government fails to adapt or
modify certain provisions of the extended enactment for bringing it in accord with local
conditions. the reasoning of the appellate Bench of the High Court, that whatever infirmity may
have existed in the impugned notification and the modification made thereby in Section 6(2), it
was rectified and cured by Parliament when it passed the Amendment Act 20 of 1959.
The bench held in regard to the argument that the power conferred by Section 2 of the Laws Act
is a power of conditional legislation and not a power of 'delegated' legislation. In our opinion, no
useful purpose will be served to pursue this line or argument because the distinction propounded
between the two categories of legislative powers makes no difference, in principle. In either case,
the person to whom the power is entrusted can do nothing beyond the limits which circumscribe
the power; he has to act - to use the words of Lord -"within the general scope of the affirmative
words which give the power" and without violating any "express conditions or restrictions by
which that power is limited". There is no magic in a name. Whether you call it the power of
"conditional legislation" as Privy Council called it in Burah's case10 it also laid down that
modification can be done as-the power does not exhaust itself on 1st exercise. What it central
Govt. fails to adapt or modify at the time of extension.
If at all any defect crops up it can be cured by the amendment.
It will be clear that the primary power bestowed by the section on the Central Government, is
one of extension, that is bringing into operation and effect, in a Union territory, an enactment
already in force in a State. The discretion conferred by the section to make 'restrictions and
modifications; in the enactment sought to be extended, is not a separate and independent power.
It is an integral constituent of the powers of extension. It cannot be exercised apart from the
power of extension. This is indubitably clear from the preposition "with" which immediately
10
Supra note 3
10
precedes the phrase 'such restrictions and modifications' and conjoins it to the principal clause of
the section which gives the power of extension. According to the Shorter Oxford Dictionary, one
meaning of the word "with", (which accords here with the context), is "part of the same whole".
The power given by Section 2 exhausts itself on extension of the enactment; it cannot be
exercised repeatedly or subsequently to such extension. It can be exercised only once,
simultaneously with the extension of the enactment. This is one dimension of the statutory limits
which circumscribe the power. The second is that the power cannot be used for a purpose other
than that of extension. In the exercise of this power, only such restrictions and modifications can
be validly engrafted in the enactment sought to be extended, which are necessary to bring it into
operation and effect in the Union territory. "Modifications" which are not necessary for, or
ancillary and subservient to the purpose of extension, are not permissible. And, only such
"modifications" can be legitimately necessary for such purpose as are required to adjust, adapt
and make the enactment suitable to the peculiar local conditions of the Union territory for
carrying it into operation and effect. In the context of the section, the words "restrictions and
modifications" do not cover such alterations as involve a change in any essential feature, of the
enactment or the legislative policy built into it. This is the third dimension of the limits that
circumscribe the power.
- Limits on power of modification.
i) At the time of extension only.
ii) Modification which is net necessary for extension cannot be done.
iii) Modification should not lead to change in the essential features the policy of the parent Act.
11
Conclusion
Every delegate is subject to the authority and control of the principal and the exercise of
delegated power can always be directed, corrected or cancelled by the principal. Hence
parliamentary control over delegated legislation should be a living continuity as a constitutional
remedy. The fact is that due to the broad delegation of legislative powers and the generalised
standard of control also being broad, judicial control has shrunk, raising the desirability and the
necessity of parliamentary control.
In a parliamentary democracy it is the function of the legislature to legislate. If it seeks to
delegate its legislative power to the executive because of some reasons, it is not only the right of
the Legislature, but also its obligation, as principal, to see how its agent i.e. the Executive carries
out the agency entrusted to it. Since it is the legislature which grants legislative power to the
administration, it is primarily its responsibility to ensure the proper exercise of delegated
legislative power, to supervise and control the actual exercise of this power, and ensure the
danger of its objectionable, abusive and unwarranted use by the administration.
The Parliamentary control over delegated legislation in USA and India is not as effective as in
UK. In UK the laying off procedure is followed effectively because there all administrative rule-
making is subjected to the control of Parliament through the Select Committee on Statutory
instruments. In India the control is not very much effective. There are no statutory provisions
regarding laying of delegated legislation. Though the working of the Scrutiny committees is not
very effective, yet they have proved to be an effective body in examining and improving upon
the legislative control over delegated legislation.
