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ADMINISTRATIVE LAW & THE REGULATORY STATE
9. Gwalior Rayon Silk Manufacturing (Weaving) v. Assistant Commissioner of Sales Tax and Others
- MODULE 1 – INTRODUCTION TO ADMINISTRATIVE LAW - 1. Additional District Magistrate, Jabalpur v. Shivkant Shukla & Others - 2. Rai Sahib Ram Jawaya Kapur & Others v. State of Punjab
- MODULE 2: EXECUTIVE LAW MAKING................................................................................................
- AMERICAN POSITION
- Field v. Clark
- Panama Refining Co. v Ryan
- National Broadcasting Co., Inc. v United States
- INDIAN POSITION
- R. v. Burrah – Pre Independence
- Jatindra Nath Gupta v. Province of Bihar – Post Independence
- In Re : The Delhi Laws Act, 1912 Case – Post Constitution
- B. Shama Rao v. Union Territory of Pondicherry
- Rajnarain Singh v. Chairman, Patna Administration Committee, Patna, and Another
- Harishankar Bagla and Another v. State of Madhya Pradesh
- Hamdard Dawakhana (Wakf) Lal Kuan, Delhi and Another v. Union of India and Others
- Lachmi Narain Etc. v. Union of India & Ors
- REMOVAL OF DIFFICULTIES CLAUSE
- Ramesh Birch & Ors. Etc vs Union Of India & Ors.
- Jalan Trading Company (Private Limited ) v. Mill Mazdoor Union
- Gammon India Limited and Others v. Union of India & Ors. etc.
- JUDICIAL CONTROL) MODULE 3: CONTROL ON EXECUTIVE LAW MAKING (LEGISLATIVE CONTROL AND
- DOCTRINE OF ULTRA VIRES
- PUBLICATION – DIRECTORY VS. MANDATORY
- Harla v. State of Rajasthan
- M/s. Pankaj Jain Agencies v. Union Of India And Other
- Collectors of Central Excise v. Tobacco Company Etc
- MODE OF PUBLICATION
- Raza Buland Sugar Co. Ltd. v. Municipal Board, Rampur
- Govindlal C. Patel vs. Agricultural Produce Market Committee
- CONSULTATION.............................................................................................................................................
- Banwarilal Agarwalla v. State of Bihar and Others
- PRE-NATAL CONTROL
- Atlas Cycles v. State of Haryana..................................................................................................
- CONSTITUTIONALITY – WHEN THERE IS EXCESS OF POWER CONFERRED BY THE ENABLING
- Dwarka Nath v. Municipal Corporation of Delhi
- RETROSPECTIVE APPLICATION
- State of Madhya Pradesh v. Tikamdas
- B. S. Yadav v. State of Haryana
- A. V. Nachane v. Union of India
- Miss Raj Soni v. Air Officer In-Charge
- V. Sudeer v. Bar Council of India
- ADMINISTRATIVE DIRECTIONS
- Kumari Regina v. St. Aloysius Higher Elementary School and Another
- K. M. Shanmugam v. S. R. V. S. Private Limited and Others
- Union of India v. K. P. Joseph and Others
- B.S. Minhas v. Indian Statistical Institute & Ors.
- DISCRETION MODULE 4: JUDICIAL REVIEW OF ADMINISTRATIVE ACTION & ADMINISTRATIVE - 35. Commissioner of Police, Bombay v. Gordhandas Bhanji............................................................ - 36. Kesavan Bhaskaran v. State of Kerala
- IRRELEVANT CONSIDERATION
- Dr. Ram Manohar Lohia v. State of Bihar and Others
- LEAVING OUT RELEVANT CONSIDERATION
- Government of Gujarat 38. Ashadevi, Wife of Gopal Ghermal Mehta (Detenu) v. K. Shiveraj, Addl. Chief Secretary to the
- COLOURABLE EXERCISE OF POWER
- Hukam Chand Shyam Lal v. Union Of India And Ors
- STANDARD OF REVIEW
- Associated Provincial Picture Houses Ltd v. Wednesbury Corporation
- Om Kumar v. UOI
- MODULE 5: PRINCIPLES OF NATURAL JUSTICE
- CLASSIFICATION OF EXECUTIVE ACTIONS
- Indian National Congress v. Institute of Social Workers
- FAIR HEARING & EXCEPTIONS
- VALID NOTICE
- State of Orissa v. Dr. Binapani
- G. Kondala Rao v. Registrar, Shri Venkateswara University......................................................
- Suresh Koshy v. University of Kerala
- Managing Director, ECL v. B. Karunakar
- SUFFICIENT TIME FOR NOTICE
- Ravi S. Naik v. Union of India
- RIGHT TO EXAMINATION
- State of Jammu and Kashmir v. Bakshi Gulam Muhammad
- Hira Nath Mishra v. The Principal, Rajendra Medical College
- RIGHT TO COUNSEL
- J. K. Agarwal v. Haryana Seeds Development Corporation
- REASONED ORDER
- S. N. Mukherjee v. Union of India
- PRE OR POST-DECISIONAL HEARINGS
- Maneka Gandhi v. Union of India
- Swadeshi Cotton Mills v. Union of India
- K. I. Shepherd v. Union of India
- Canara Bank v. V. K. Awasthy
- Charanlal Sahu v. Union of India
- NOT IN COURSE MANUAL
- Bihar School Education Board v. Subash Chandra.....................................................................
- RULE AGAINST BIAS
- A.K. Kraipak v. Union of India
- PECUNIARY BIAS
- J. Mohapatra and Co v. State of Orissa.......................................................................................
- PERSONAL BIAS
- D. K. Khanna v. Union of India
- Mineral Development Limited v. State of Bihar
- State of Uttar Pradesh v. Mohammad Nooh
- WAIVER
- Manak Lal v. Dr. Prem Chand.....................................................................................................
- SUBJECT-MATTER BIAS
- Gullapalli Nageswara Rao v. APSRTC Case I
- Gullapalli Nageswara Rao v. APSRTC Case II
- DOCTRINE OF NECESSITY - 66. Election Commission v. Dr. Subramanian Swamy - 67. Ashok Kumar Yadav v. State of Haryana..................................................................................... - 68. Tata Cellular v. Union of India....................................................................................................
- NO APPARENT BIAS
- G.N. Nayak v. Goa University
- MODULE 6: LEGITIMATE EXPECTATIONS AND PROMISSORY ESTOPPEL
- PROMISSORY ESTOPPEL
- M/S Motilal Padampat Sugar Mills v. State of U. P.
- LEGITIMATE EXPECTATIONS
- M. R. F. Ltd., Kottayam Ltd. Assistant Commissioner Sales Tax
- Navjyoti Co-Operative Housing Society v. Union of India
- Punjab Communications Ltd. v. Union of India
MODULE 1 – INTRODUCTION TO ADMINISTRATIVE LAW
1. Additional District Magistrate, Jabalpur v. Shivkant Shukla & Others o Majority Opinion: ▪ The Constitution itself embodies the Rule of Law, with no recognition of natural rights beyond Article 21. Article 21 is deemed as the sole repository of personal liberty, with any other rights seen as subsidiary to it. ▪ The intention of Parliament during an emergency was to suspend the jurisdiction of the courts under Article 226, including cases like the one at hand. ▪ Part III rights, including fundamental rights, are suspended during emergencies. o Dissenting Opinion (Justice H.R. Khanna): ▪ Article 359(1) invocation doesn't strip individuals of their right to approach the Court for enforcement of statutory rights. ▪ Article 21 doesn't exclusively hold the right to life and personal liberty; they exist as natural rights beyond constitutional provisions. Without Article 21, the State wouldn't have the authority to deprive individuals of life or liberty, affirming their natural right. ▪ Life and personal liberty are inherent to human existence and aren't contingent upon constitutional recognition. ▪ Justice Khanna upholds the power of the Court to issue writs of habeas corpus as a fundamental aspect of the rule of law. 2. Rai Sahib Ram Jawaya Kapur & Others v. State of Punjab o Facts: Uttar Chand & Sons, a group of publishers and printers, challenged the actions of the Punjab Education Department. In 1950, the Department nationalized textbooks, limiting the number of books that could be bid for, and in 1952, it imposed restrictions on publishers' royalties and took full control over the textbook publication process. o Issue: Whether the executive, without legislative authorization, can engage in trade or business activities, and whether such actions violate fundamental rights necessitating compensation. o Rule: The executive power extends to matters within the competence of the state legislature, not confined to already legislated areas. ▪ Executive power includes inherent powers needed to achieve constitutional objectives. ▪ Legislative sanction is not always required for executive actions if a safeguard exists within the law. o Petitioner’s Contentions: The executive lacks authority to engage in trade or business without legislative sanction, and its actions violate fundamental rights, requiring compensation. They argue that monopoly over trade or business requires legislative backing and compensation under Art.31.
MODULE 2: EXECUTIVE LAW MAKING
American position
3. Field v. Clark o Facts: The case concerns the constitutionality of the Tariff Act of 1890, specifically Section 3, which granted the President the power to suspend tariff rates if certain conditions were met. The act allowed the President to suspend the free introduction of specific goods, such as sugar, molasses, coffee, tea, and hides, if he deemed that a country exporting these goods to the United States imposed duties or exactions on American products that he considered reciprocally unequal or unreasonable. The case was brought by importers (Field) who challenged the constitutionality of this delegation of power to the President. o Issue: Whether Section 3 of the Tariff Act of 1890, which granted the President the authority to suspend tariff rates based on his judgment of reciprocity in trade, constituted an unconstitutional delegation of legislative power by Congress to the President. o Rule: The principle of separation of powers, vital to the integrity of the constitutional system, prohibits Congress from delegating legislative power to the President. However, a delegation of power to the executive does not violate this principle if it does not grant the President the authority to make laws, but rather assigns to him a discretionary role in executing laws passed by Congress. o Holding: The Court held that the delegation of authority to the President under Section 3 of the Tariff Act of 1890 did not constitute an unconstitutional delegation of legislative power. ▪ The Court reasoned that Congress had already determined the duties to be levied, collected, and paid, and the President's power was limited to the enforcement of the act. ▪ The President acted as an agent of the law-making department, merely ascertaining, and declaring the event upon which Congress's expressed will was to take effect. ▪ The Court emphasized that the President's role was limited to carrying out Congress's directives, and his actions did not constitute the exercise of legislative power. ▪ Therefore, the President's actions were not legislative in nature but rather in execution of Congress's directives. 4. Panama Refining Co. v Ryan o Facts: On January 7, 1935, the United States Supreme Court ruled on the constitutionality of Section 9(c) of Title I of the National Industrial Recovery Act (NIRA) of 1933. This section granted the President the authority to prohibit the transportation of petroleum in excess of state quotas in interstate and foreign commerce. o The President, in turn, delegated this power to the Secretary of the Interior through a series of executive orders. Two Texas oil companies, Panama Refining Co. and Amazon Petroleum Corp.
separately challenged the regulations imposed by the Secretary of the Interior and the constitutionality of Section 9(c) of the NIRA. o Issue: Whether Section 9(c) of the National Industrial Recovery Act unconstitutionally delegated legislative power to the President, which was further delegated to the Secretary of the Interior, thereby violating the separation of powers doctrine. o Rule: Congress cannot delegate legislative powers to other branches of government without providing clear policies and standards for formulating regulations. While administrative agencies can make rules within prescribed limits, Congress must provide guidelines to ensure that the delegated authority is not exercised arbitrarily or excessively. o Holding: The Supreme Court held that Section 9(c) of the NIRA, along with the executive orders issued pursuant to it, constituted an unconstitutional delegation of legislative power. ▪ The Court reasoned that the allowance or prohibition of transportation of goods, such as petroleum, was inherently a matter of legislative policy. ▪ While administrative agencies can make rules within prescribed limits, Congress must establish policies and standards for their formulation. ▪ In this case, the lack of clear limits on executive discretion concerned the Court, as Congress had not provided adequate guidelines for the exercise of delegated authority. ▪ In the absence of such guidelines, delegations of power may be deemed unconstitutional. Therefore, the Court invalidated Section 9(c) of the NIRA and the executive orders issued under it.
5. National Broadcasting Co., Inc. v United States o Facts: On October 30, 1941, National Broadcasting Co. (NBC) brought a suit challenging the enforcement of the Chain Broadcasting Regulations issued by the Federal Communications Commission (FCC) on May 2, 1941. These regulations were designed to regulate "chain broadcasting" practices in the radio industry. The regulations targeted the licensing of individual radio stations participating in activities deemed contrary to the public interest, rather than directly regulating radio networks. o Issue: Whether the FCC's regulations, aimed at regulating chain broadcasting practices through licensing restrictions on individual stations, were within the Commission's statutory authority and whether the delegation of legislative power to the FCC violated the Constitution. o Rule: Congress can delegate authority to administrative agencies to make rules and regulations as long as there are clear policies and standards provided by Congress. The delegated authority must serve the public interest, convenience, or necessity, and the agency's actions must be within the scope of its statutory authority.
o The dissenting opinion argued that the extension of the Act for another year did not constitute re- enactment but merely a continuation of the Act within the maximum period contemplated by the legislature. Upholding the provision, the dissenting opinion viewed the extension as maintaining the Act's continuity rather than enacting new legislation.
8. In Re : The Delhi Laws Act, 1912 Case – Post Constitution o Facts: The case involved the challenge of three Acts: Delhi Laws Act, Ajmer-Merwara Act, and Part C States Act. These Acts conferred powers on the provincial and central governments to extend, with restrictions and modifications, enactments from other provinces or territories to Delhi, Ajmer-Merwara, and Part C States, respectively. The Acts were challenged on the grounds of excessive delegation of legislative power. o Issue: Whether the provisions of the three Acts, allowing for the extension of laws with restrictions, modifications, repeal, and amendment, were ultra vires the Legislature or Parliament. o Tests Established: ▪ Delegation of legislative power is permissible but subject to limitations. ▪ Justice Kania proposed three tests: 1. The subject of delegation must be within the legislative power. 2. The power of delegation must not be negated by the constitutional instrument. 3. Delegation must not create a parallel legislative body. ▪ Justice Fazl Ali emphasized: 1. Primary legislative functions must be discharged by the legislature itself. 2. Delegation is ancillary to legislative power but cannot involve essential functions. ▪ Justice Mukherjee stated that the legitimacy of delegation depends on its necessity for effective legislative exercise, but essential functions must remain with the legislature. ▪ Essential legislative functions, including laying down policy and enacting binding rules, cannot be delegated. o Holding: The Court held that while delegation of certain functions is permissible, essential legislative functions cannot be delegated. ▪ Delegation of power to make modifications and alterations to laws was deemed acceptable as incidental to the application of law. ▪ However, the power to repeal laws was considered a legislative act, and delegating it to the executive was deemed excessive. ▪ Therefore, while restrictions and modifications were valid, provisions allowing for repeal and amendment were ultra vires. ▪ The case established that while delegation of ancillary functions is permissible, essential legislative functions must remain with the legislature.
▪ The Court provided tests to determine the validity of delegation, emphasizing the importance of retaining legislative authority within constitutional limits.
9. Gwalior Rayon Silk Manufacturing (Weaving) v. Assistant Commissioner of Sales Tax and Others o Facts: The case concerned Section 8(2)(b) of the Central Sales Tax Act, 1956, which determined the rate of Central Sales Tax. The provision stated that for goods other than declared goods, the tax rate shall be either ten percent or the rate applicable to the sale or purchase of such goods within the appropriate State, whichever is higher. The provision was challenged on the grounds of excessive delegation, as Parliament did not fix the tax rate itself but adopted the rate applicable within the appropriate State. o Holding: The Supreme Court upheld Section 8(2)(b) of the Central Sales Tax Act. ▪ The Court held that the Act provided sufficient guidelines for the executive to fix the rate of the tax. The legislative policy underlying the provision was to fix the sales tax at a minimum of ten percent to prevent evasion and discourage interstate sale of goods to unregistered dealers. ▪ While the legislature cannot delegate its essential functions, it can delegate subordinate legislation to fulfill the purposes of the Act, provided that clear policy or standards are laid down for the exercise of such delegated authority. ▪ The essential legislative functions, including laying down policy, cannot be delegated. ▪ J. Khanna – Legislature must lay down a principle or standard for the guidance of the delegate. ▪ J. Matthew – Delegation involves the granting of discretionary powers to another, but ultimate power always remains with the legislature. The legislature cannot be said to abdicate its legislative functions if it could at any time repeal the legislation and withdraw its authority and discretion it has vested on the delegate. 10. B. Shama Rao v. Union Territory of Pondicherry o Facts: After the administration in Pondicherry was transferred to the Indian Government, the Indian Parliament passed a law in 1963 establishing a legislature for Pondicherry. Subsequently, the Pondicherry legislature enacted the General Sales Tax Act, 1965. Meanwhile, the Madras General Sales Tax Act was amended by the Legislative Assembly of Madras. In March 1966, the central executive issued a notification stating that from April 1966, the provisions of the amended Madras General Sales Tax Act would be applicable in Pondicherry. The petitioner, a liquor dealer, received a notice under the new Act requiring registration. He challenged the notification on the grounds of excessive delegation. o Holding: The Supreme Court held that the notification of the government declaring the operation of the Madras General Sales Tax Act in Pondicherry was void due to excessive delegation.
▪ The legislative policy was defined as the maintenance or increase in the supply of essential commodities and securing their equitable distribution and availability at fair prices. ▪ The Court emphasized that the legislature must declare the policy of the law and provide guiding principles for its execution, which Section 3 accomplished. ▪ Therefore, the exercise of power under Section 3 was deemed valid due to the clarity of the legislative policy and the guiding principles provided.
13. Hamdard Dawakhana (Wakf) Lal Kuan, Delhi and Another v. Union of India and Others o Facts: The case involved a challenge to the Drugs and Magic Remedies Act, 1954. Section 3 of the Act prohibited the publication of advertisements referring to drugs for the diagnosis, cure, mitigation, treatment, or prevention of any venereal disease or any other disease or condition specified in rules made under the Act. Section 16 empowered the Central Government to make rules for carrying out the purposes of the Act, including specifying diseases or conditions to which the provisions of Section 3 shall apply. o Holding: The Supreme Court held that the provision empowering the government to include diseases for which the advertisement of medicines would be banned was unconstitutional. ▪ It was observed that Parliament had not established any criteria, standard, or principle on which a particular disease could be specified. The Court deemed the provision as vague and held that it went beyond the permissible boundaries of valid delegation. ▪ Therefore, the provision was struck down as it amounted to excessive delegation of legislative power. 14. Lachmi Narain Etc. v. Union of India & Ors o Facts: The Central Government extended the Bengal Finance (Sales Tax) Act, 1941, to the then State of Delhi in 1951 with certain modifications. In 1957, the Central Government made additional modifications to Section 6 of the Bengal Act through a notification. The modifications were related to the requirement of giving notice for amendments to the Schedule of exempted goods under the Act. o Holding: The Supreme Court held that the 1957 notification, purporting to substitute the words "such previous notice as it considers reasonable" for "not less than 3 months' notice" in Section 6(2) of the Bengal Act, was ultra vires the statute. ▪ The power conferred by Section 2 of the Part C States (Laws) Act, 1950, which allowed for the extension of enactments with restrictions and modifications, was one of extension and could only be exercised once, simultaneously with the extension of the enactment. ▪ The power could not be used for a purpose other than extension, and modifications could only be made to bring the enactment into operation in the Union Territory. The 1957 modification
was made more than 6 years after the initial extension of the Act, thereby exceeding the limits of the power conferred by Section 2. ▪ Additionally, the modification altered an essential feature of the legislative policy embodied in the Bengal Act, which required not less than 3 months' notice for amendments to the Schedule. ▪ Therefore, the modification was declared invalid as it went against the essential legislative features and the scope of the power conferred by Section 2. Removal of Difficulties Clause a provision commonly found in statutes that grants the government or relevant authority the power to address any challenges or obstacles encountered during the implementation of the law. This clause allows for the resolution of issues that may arise during the execution of the statute, ensuring its smooth application and effectiveness. a. Narrow Power to Remove Difficulties: empowers the government or authority to address specific challenges within the confines of the Parent Act's provisions, ensuring that modifications are limited to resolving particular issues without fundamentally altering the legislation's substance. b. Broader Version with Modification Authority: grants the government or authority broader discretion to amend the Parent Act itself within specified parameters, allowing for more comprehensive adjustments to tackle difficulties encountered during implementation. However, these modifications are typically subject to restrictions, such as temporal limitations or requiring approval from relevant legislative bodies, to prevent potential misuse and divergence from the original legislative intent.
15. Ramesh Birch & Ors. Etc vs Union Of India & Ors. o Facts: Under Section 87 of the Punjab Reorganisation Act, 1966, the Central Government was empowered to extend, with restrictions and modifications, any enactment in force in a State to the Union Territory of Chandigarh. The East Punjab Urban Rent Restriction Act, 1949, was extended to Chandigarh in 1974 with modifications. In 1985, the State of Punjab enacted the East Punjab Urban Rent Restriction (Amendment) Act, 1985, to enhance the effectiveness of the 1949 Act. In 1986, the Central Government extended the provisions of the 1985 Act to Chandigarh, with modifications, under Section 87 of the Reorganisation Act. Court o Holding: The notification and extension by the Central Government were deemed valid. ▪ Delegating such powers to the executive was essential due to the complex nature of modern governance. While legislatures must establish legislative policy clearly, they need not provide exhaustive details; a broad indication suffices. ▪ Section 87 did not represent an excessive delegation as it did not amount to abdication or self- effacement of legislative authority. Delegation under Section 87 allowed the executive to
MODULE 3: CONTROL ON EXECUTIVE LAW MAKING (LEGISLATIVE CONTROL AND
JUDICIAL CONTROL)
Doctrine of Ultra Vires Publication – Directory vs. Mandatory Is the requirement of prior publication of delegated legislation mandatory?
18. Harla v. State of Rajasthan o The appellant was convicted under the Jaipur Opium Act for an offense that occurred in 1948. o The issue revolved around whether a mere resolution passed by the Council of Ministers in Jaipur without further publication or promulgation was sufficient to make the law operative. o The timeline revealed that the Council of Ministers was not a sovereign body and its powers were defined and limited by the Crown Representative. o The court held that without specific publication or promulgation, a mere resolution of the Council of Ministers was insufficient to enact law, emphasizing the principles of natural justice. o The Jaipur Laws Act of 1923 saved only laws valid at the time, not resolutions that had not acquired the force of law. o Thus, the court ruled that the Jaipur Opium Act was not enforceable due to lack of proper publication or promulgation. 19. M/s. Pankaj Jain Agencies v. Union Of India And Other o Facts: Challenged the validity of a notification issued under the Customs Act, 1962, related to customs duty on imports of parts of ball bearings and roller bearings. ▪ Contention was that the notification was not effectively promulgated as it was not known to the public at the time of import. ▪ The notification was published in the Official Gazette on 13- 2 - 1986, but not available in Bombay until 19- 2 - 1986. o Holding: Publication through official channels like the Official Gazette is essential for the notification to take effect. Mere printing in the Gazette is not sufficient; the notification must be made available to the public. Once published as per the Act's requirements, further dissemination for enforceability is not necessary. 20. Collectors of Central Excise v. Tobacco Company Etc o Facts: Notification enhancing the duty on cigarettes was published in the Official Gazette on 30th November 1982 but made available for sale to the public on 8th December 1982.
▪ Under the Central Excise and Salt Act, 1944, all rules and notifications must be published in the official Gazette. o Holding: Natural justice necessitates promulgation or publication of laws for them to be operative. ▪ Mere publication in the Gazette is not enough; the law must be known to the public. ▪ The earlier interpretation of Pankaj Jain case, requiring public awareness for publication, was overruled by Gulf Goan Hotels vs. Union of India. The principle of publication ensures that laws must be made known to the public for enforcement, typically through publication in an official gazette or accessible platform. Mode of Publication refers to the method and manner in which laws are made public, with the distinction that while publication is mandatory, strict compliance with the mode of publication may not always be insisted upon.
21. Raza Buland Sugar Co. Ltd. v. Municipal Board, Rampur o Facts: Rampur Municipality proposed to levy property tax as per the U.P. Municipalities Act. Section 131(3) mandated the publication of proposals and draft rules along with a notice inviting objections, in accordance with Section 94(3), which required publication in a local Hindi newspaper or as directed by the State Government. The resolution was published in an Urdu local newspaper instead of a local Hindi newspaper. o Holding - Publication: The court held that the publication of proposals was mandatory, considering its purpose to invite objections from taxpayers. ▪ Section 131(3) was deemed mandatory, requiring strict compliance. ▪ However, the mode of publication under Section 94(3) was held to be directory, requiring substantial compliance. ▪ Despite the technical defect of publication in an Urdu newspaper, substantial compliance was achieved since the resolution was published in Hindi, serving the purpose of the mandatory provision. 22. Govindlal C. Patel vs. Agricultural Produce Market Committee o Facts: The Gujarat Agricultural Produce Markets Act mandated the publication of notifications in Gujarati in a newspaper for market area declarations. The appellant argued that the requirement was limited to Section 6(1) and should be discretionary. o Holding: The court ruled that the distinction between "section" and "sub-section" must be recognized. The word "shall" in Section 6(1) indicated a mandatory requirement.
The directory test determines whether a statutory provision outlining legislative procedures is mandatory or merely advisory, based on the legislative scheme, language & consequences specified in the relevant law.
24. Atlas Cycles v. State of Haryana o Facts: The Development Officer of the Directorate-General conducted a review of Atlas Cycle's balance sheet and found purchases of iron sheets at a higher rate than the maximum permissible price. Charges were imposed on Atlas Cycle under various sections of the Indian Penal Code and the Control Order. Atlas Cycle contested the validity of the notification setting maximum selling prices for iron and steel, arguing that it was not laid before Parliament as required by the Essential Commodities Act. o Provisions: Section 3(6) of the Essential Commodities Act mandates that any order made under the Act must be laid before both Houses of Parliament. However, the Act does not specify the consequences of non-compliance or the timeframe for laying down the order. o Holding: The court held that failure to lay down the order before Parliament did not automatically invalidate the notification. ▪ The provision in Section 3(6) was deemed directory rather than mandatory because it did not specify any penalties for non-compliance. ▪ The intention of the legislature was not to nullify orders due to non-laying, especially considering the absence of provisions for alternative actions or penalties. ▪ Non-compliance did not result in the nullification of the notification, as there was no provision for such consequences in the Act. ▪ Reasoning for Directory Interpretation: The Act did not provide for contingencies in case of non-compliance. Invalidating the order would cause serious inconvenience to the public. Section 3(6) did not specify any type of laying procedure or empower Parliament to annul the order, indicating a directory nature. Post-Natal Safeguard – Substantive Substantive Ultra Vires: Occurs when subordinate legislation exceeds the authority granted by the parent act. Grounds for substantive ultra vires include inconsistency with general law, arbitrariness, unconstitutionality, and retroactivity. ▪ Grounds: Delegated legislation may be invalidated if it breaches fundamental rights, exceeds essential legislative functions, or operates retrospectively. Other grounds include inconsistency with general law, arbitrariness, unreasonableness, and mala fide intentions.
Constitutionality of the Parent Act The validity of delegated legislation hinges on the constitutionality of the parent act. If the enabling statute is invalid, the delegated legislation may also be deemed invalid. Constitutional validity depends on whether the delegation adheres to the scope of power conferred on the legislature and does not violate any constitutional restrictions or fundamental rights. Constitutionality – When there is excess of power conferred by the enabling
25. Dwarka Nath v. Municipal Corporation of Delhi o Facts: M/s. Mohan Ghee Laboratories sold pure Desi Ghee in New Delhi. Food inspectors purchased ghee samples from the laboratory, which were later tested and found to conform to standards. However, the labeled tins from which samples were taken did not comply with labeling rules. o Rule: Rule mandated the inclusion of batch or code numbers on food labels to prevent public deception about the product's character, quality, or quantity. o Holding - Rule 32(e): The requirement of batch or code numbers alone, without additional details like manufacturing and expiry dates, did not prevent consumer deception as intended by the Act. No rational connection established between the rule and prevention of consumer deception. Rule deemed beyond the rule-making power conferred by the Act. o Holding - Rule 32(b): Mandate to include the manufacturer's name and business address deemed valid as it is commonly associated with product quality. Technical breach acknowledged due to incomplete particulars, but conviction for non-compliance with Rule 32(e) overturned. o Rule was substantively ultra vires the parent act, as it had no connection with the purpose of the act. The act envisaged that consumers must not be deceived or misled. o Providing batch or code number, w/o additional details such as manufacturing date and expiry date would not prevent the consumer from being misled. o There was no rational or remote connection between the requirement of batch or code numbers alone and the act's objective of preventing consumer deception. o Therefore, the rule was considered to exceed the scope of the rule-making power conferred by the parent act. Retrospective Application While legislatures may enact laws retrospectively, delegates can do so only if expressly authorized by the parent statute, as retrospective rules may affect vested rights and should therefore primarily be within the purview of the legislature.
