Full Judgment Text
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PETITIONER:
REGISTRAR OF CO-OPERATIVE SOCIETIES, TRIVANDRUM AND ANR.
Vs.
RESPONDENT:
K. KUNHAMBU & ORS
DATE OF JUDGMENT27/11/1979
BENCH:
REDDY, O. CHINNAPPA (J)
BENCH:
REDDY, O. CHINNAPPA (J)
SARKARIA, RANJIT SINGH
CITATION:
1980 AIR 350 1980 SCR (2) 260
1980 SCC (1) 340
CITATOR INFO :
R 1990 SC 560 (13,15)
RF 1991 SC2160 (23)
ACT:
Administrative law-Delegation of legislative power-Act
confers power on Government to exempt co-operative society
from operation of Act-Delegation if excessive-Madras
Cooperative Societies Act 1932, S. 60-Whether void.
HEADNOTE:
Section 60 of the Madras Cooperative Societies Act,
1932, empowers the State Government to exempt a registered
society from any of the provisions of the Act or to direct
that such provision shall apply to such society with
specified modifications.
In the appeal to this Court on the question whether
Section 60 of the Act is void on the ground of
unconstitutional delegation of legislative power.
^
HELD: 1. Section 60 is not void on the ground of
excessive delegation of legislative power. [267 C]
2. The power given to the Government under section 60
of the Act is to be exercised so as to advance the policy
and objects of the Act, according to the guidelines
enunciated in the preamble and the other provisions of the
Act.[267 B]
3. The Act, a welfare legislation, to facilitate the
formation and working of cooperative societies consists of
numerous provisions, dealing with registration of societies,
rights and liabilities of members, duties of registered
societies, privileges of registered societies, property and
funds of registered societies, inquiry and inspection,
supersession of committees of societies, dissolution of
societies, surcharge and attachment, arbitration etc. The
too rigorous application of some of the provisions of the
Act may itself occasionally result in frustrating the very
objects of the Act instead of advancing them. To provide for
such situations, the Government was invested by section 60
with a power to relax the occasional rigour of the
provisions of the Act and to advance the objects of the
Act.[266 D, G; H 277 A]
4. (i) Parliament and the State Legislatures are
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endowed with plenary power to legislate upon any of the
subjects entrusted to them by the Constitution, subject to
the limitations imposed by the Constitution itself. The
power to legislate carries with it the power to delegate.
While excessive delegation may amount to abdication,
delegation unlimited may invite despotism uninhibited. The
theory has therefore been evolved that the legislature
cannot delegate its essential function. [262 H-263 A]
(ii) The Parliament and the State Legislatures are not
bodies of experts or specialists. They are skilled in the
art of discovering the aspirations, the expectations and the
needs, the limits to the patience and the acquiescence and
the articulation of the views of the people whom they
represent. They function best when they concern themselves
with general principles, broad objectives and
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fundamental issues instead of technical and situational
intricacies which are better left to better equipped full
time expert executive bodies and specialist public servants.
Parliament and the State Legislatures have neither the time
nor the expertise to be involved in detail and circumstance.
Nor can Parliament and the State Legislatures visualise and
provide for new, strange, unforeseen and unpredictable
situations arising from the complexity of modern life and
the ingenuity of modern man. That is the raison d’etre for
delegated legislation. [262 E-G]
(iii) The Legislature may guide the delegate by
speaking through the express provision empowering delegation
or the other provisions of the statute, the preamble, the
scheme or even the very subject matter of the statute. If
guidance there is, wherever it may be found the delegation
is valid. A generous degree of latitude must be held
permissible in the case of welfare legislation, particularly
these statutes which are designed to further the Directive
Principles of State Policy. [263 B]
Delhi Laws Act 1912, [1951] SCR 747: M. K. Papiah &
Sons v. Excise Commissioner [1975] 3 SCR 607: Harishankar
Bagla and Anr. v. The State of Madhya Pradesh [1955] 1
S.C.R., p. 380 @ 388: The Edward Mills Co. Ltd., Beawar v.
The State of Ajmer [1955] 1 S.C.R. 735: Pandit Banarsi Das
Bhanot v. The State of Madhya Pradesh [1959] S.C.R. 427:
Sardar Inder Singh v. The State of Rajasthan, [1959] S.C.R
605: Vasantlal Maganbhai Sanjanwala v. The State of Bombay,
[1961] 1 S.C.R. 341: Jyoti Prasad v. The Administrator for
the Union Territory of Delhi [1962] 2 S.C.R. 125: Mohammad
Hussain Gulam Mohammad v. The State of Bombay, [1962] 2
S.C.R. 659, referred to.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1258 of
1969.
From the Judgment and Decree dated 17-2-1969 of the
Kerala High Court in Writ Appeal No. 45 of 1968.
V. A. Seyid Mohammed and K. M. K. Nair for the
Appellant.
Ex-Parte for the Respondent.
The Judgment of the Court was delivered by
CHINNAPPA REDDY, J.-The perennial, nagging problem of
delegated legislation and the so-called Henry VIII clause
have again come up for decision in this appeal by the State
of Kerala. Section 60 of the Madras Cooperative Societies
Act 1932 and a notification issued under that provision were
struck down by the High Court of Kerala on the ground of
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unconstitutional delegation of legislative power. Certain
consequential directions were issued by the High Court.
Those directions have long since worked themselves out and
so the party who invoked the jurisdiction of the High Court
under Article 226 of the Constitution has no longer any
surviving interest. The State of Kerala is, however,
interested in sustaining the validity of Section 60 and has
filed this appeal.
Lawyers and judges have never ceased to be interested
in the question of delegated legislation and since the Delhi
Laws Act case, we
262
have been blessed(?) by an abundance of authority, the
blessing not necessarily unmixed. We do not wish, in this
case, to search for the precise principles decided in the
Delhi Laws Act case, nor to consider whether N. K. Papiah &
Sons v. Excise Commissioner(1) beats the final retreat from
the earlier position. For the purposes of this case we are
content to accept the "policy" and "guidelines" theory and
seek such assistance as we may derive from cases where near
identical provisions have been considered.
It is trite to say that the function of the State has
long since ceased to be confined to the preservation of the
public peace, the exaction of taxes and the defence of its
frontiers. It is now the function of the State to secure to
its citizens ’Social, economic and political justice’, to
preserve ’liberty of thought, expression, belief, faith and
worship,’ and to ensure ’equity of status and of
opportunity’ and ’the dignity of the individual’ and the
’unity of the nation. That is what the Preamble to our
Constitution says and that is what is elaborated in the two
vital chapters of the Constitution on Fundamental Rights and
Directive Principles of State Policy. The desire to attain
these objectives has necessarily resulted in intense
legislative activity touching every aspect of the life of
the citizen and the nation. Executive activity in the field
of delegated or subordinate legislation has increased in
direct, geometric progression. It has to be and it is as it
should be. The Parliament and the State Legislatures are not
bodies of experts or specialists. They are skilled in the
art of discovering the aspirations, the expectations and the
needs, the limits to the patience and the acquiescence and
the articulation of the views of the people whom they
represent. They function best when they concern themselves
with general principles, broad objectives and fundamental
issues instead of technical and situational intricacies
which are better left to better equipped full time expert
executive bodies and specialist public servants. Parliament
and the State Legislatures have neither the time nor the
expertise to be involved in detail and circumstance. Nor can
Parliament and the State Legislatures visualise and provide
for new, strange, unforeseen and unpredictable situations
arising from the complexity of modern life and the ingenuity
of modern man. That is the raison d’etre for delegated
legislation. That is what makes delegated legislation
inevitable and indispensable. The Indian Parliament and the
State Legislatures are endowed with plenary power to
legislate upon any of the subjects entrusted to them by the
Constitution, subject to the limitations imposed by the
Constitution itself. The power to legislate carries with it
the power to delegate. But excessive delegation may amount
to abdication. Delegation unlimited may invite
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despotism uninhibited. So the theory has been evolved that
the legislature cannot delegate its essential legislative
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function. Legislate it must by laying down policy and
principle and delegate it may to fill in detail and carry
out policy. The legislature may guide the delegate by
speaking through the express provision empowering delegation
or the other provisions of the statute, the preamble, the
scheme or even the very subject matter of the statute. If
guidance there is, wherever it may be found, the delegation
is valid. A good deal of latitude has been held to be
permissible in the case of taxing statutes and on the same
principle a generous degree of latitude must be permissible
in the case of welfare legislation, particularly those
statutes which are designed to further the Directive
Principles of State Policy.
In Harishankar Bagla and Anr. v. The State of Madhya
Pradesh,(1) the question arose whether Section 3 of the
Essential Supplies (Temporary Powers) Act, 1946, which
empowered the Central Government to make orders providing
for the regulation or prohibition of the production, supply
and distribution of essential commodities and trade and
commerce therein was void for excessive delegation. The
Court said it was not and observed:
"....the legislature cannot delegate its function
of laying down legislative policy in respect of a
measure and its formulation as a rule of conduct. The
Legislature must declare the policy of the law and the
legal principles which are to control any given cases
and must provide a standard to guide the officials or
the body in power to execute the law. The essential
legislative function consists in the determination or
choice of the legislative policy and of formally
enacting that policy into a binding rule of conduct. In
the present case the legislature has laid down such a
principle and that principle is the maintenance or
increase in supply of essential commodities and of
securing equitable distribution and availability at
fair prices. The principle is clear and offers
sufficient guidance to the Central Government in
exercising its powers under section 3".
In The Edward Mills Co. Ltd., Beawar v. The State of
Ajmer(2), this Court considered the question whether s. 27
of the Minimum Wages Act under which power was given to the
Government to add to either part of the schedule any
employment in respect of which it was in its opinion that
minimum wages should be fixed exceeded the
264
limits of permissible delegation and was, therefore,
unconstitutional. The Court held that the legislative policy
was apparent on the face of the enactment which aimed at the
statutory fixation of minimum wages with a view to obviate
the chance of exploitation of labour. The intention of the
Legislature was not to apply the Act to all industries but
only to those industries where by reason of unorganised
labour or want of proper arrangements for effective
regulation of wages or for other causes the wages of
labourers in a particular industry were very low. In
enacting s. 27 there was, therefore, no delegation of
essential legislative power.
In Pandit Banarsi Das Bhanot v. The State of Madhya
Pradesh(1), this Court held that it was not unconstitutional
for the Legislature to leave it to the Executive to
determine details relating to the working of taxation laws
such as the selection of persons on whom the tax is to be
laid, the rates at which it is to be charged in respect of
different classes of goods and the selection of goods in
respect of which exemption from taxation might be granted
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etc. etc.
In Sardar Inder Singh v. The State of Rajasthan(2), the
validity of s.15 of the Rajasthan (Protection of Tenants)
Ordinance which authorised the Government to exempt any
person or class of persons from the operation of the Act was
upheld and the argument that there was impermissible
delegation of legislative power was repelled on the ground
that the Preamble to the Ordinance set out with sufficient
clarity the policy of the Legislature.
In Vasantal Maganbhai Sanjanwala v. The State of
Bombay(3), s. 6 (2) of the Bombay Tenancy & Agricultural
Lands Act was challenged as permitting excessive delegation
of legislative power as it enabled the Government to fix a
lower rate of the maximum rent payable by the tenants of
lands situate in any particular area or to fix such rate on
any suitable cases as it thought fit. This Court noticed
that the Act was undoubtedly a beneficent measure, as shown
by the Preamble which stated that the object of the Act was
to improve the economic and social conditions of peasants
and ensure the full and efficient use of land for
agricultural. Bearing in mind the Preamble and the material
provisions of the Act, it was held that the power delegated
was within permissible limits.
265
In Jyoti Pershad v. The Administrator for the Union
Territories of Delhi,(1) Rajagopala Ayyangar, J. made some
useful observations which may be extracted here:
"In regard to this matter we desire to make two
observations. In the context of modern conditions and
the variety and complexity of the situations which
present themselves for solution, it is not possible for
the Legislature to envisage in detail every possibility
and make provisions for them. The Legislature therefore
is forced to leave the authorities created by it an
ample discretion limited, however, by the guidance
afforded by the Act. This is the ratio of delegated
legislation, and is a process which has come to stay,
and which one may be permitted to observe is not
without its advantages. So long therefore as the
Legislature indicates, in the operative provisions of
the statute with certainty, the policy and purpose of
the enactment, the mere fact that the legislation is
skeletal, or the fact that a discretion is left to
those entrusted with administering the law, affords no
basis either for the contention that there has been an
excessive delegation of legislative power as to amount
to an abdication of its functions, or that the
discretion vested is uncanalised and unguided as to
amount to a carte blanche to discriminate. The second
is that if the power or discretion has been conferred
in a manner which is legal and constitutional, the fact
that Parliament could possibly have made more detailed
provisions, could obviously not be a ground for
invalidating the law."
In Mohammad Hussain Gulam Mohammad v. The State of
Bombay,(2) the question was about the vires of s. 29 of the
Bombay Agricultural Produce Markets Act. It gave power to
the State Government to add to, or amend, or cancel any of
the items of agricultural produce specified in the schedule
in accordance with prevailing local conditions. The attack
was on the ground that legislative power had been delegated
to an extent not permissible. The Court while noticing that
s. 29 itself did not provide for any criterion for
determining which item of agricultural produce should be put
into the schedule, nevertheless upheld its vires on the
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ground that guidance was writ large in the various
provisions and the scheme of the Act. It was observed that
in each case the State Government had to consider whether
the
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volume of trade in the produce was of such a nature as to
give rise to wholesale trade so as to merit inclusion in the
schedule.
Let us now turn to s. 60 of the Madras Cooperative
Societies Act, 1932 whose vires is in question and which is
as follows:-
"S. 60: The State Government may, by general or
special order, exempt any registered society from any
of the provisions of this Act or may direct that such
provisions shall apply to such society with such
modifications as may be specified in the order."
The provision is a near Henry VIII clause. But to give it a
name is not to hang it. We must examine the preamble, the
scheme and other available material to see if there are any
discernible guidelines. Sure the Cooperative Societies Act
is a welfare legislation. Its preamble proclaims:
"Whereas it is expedient further to facilitate the
formation and working of co-operative societies for the
promotion of thrift, self-help and mutual aid among
agriculturists and other persons with common economic
needs so as to bring about better living, better
business and better methods of production and for that
purpose to consolidate and amend the law relating to
co-operative societies in the State of Madras."
The policy of the Act is there and so are the
guidelines. Why the legislation ? "To facilitate the
formation and working of Cooperative Societies". Cooperative
Societies, for what purpose ? "For the promotion of thrift,
self-help and mutual aid". Amongst whom ? "Among
agriculturists and other persons with common economic
needs". To what end ? "To bring about better living, better
business and better methods of production". The objectives
are clear; the guidelines are there. There are numerous
provisions of the Act dealing with registration of
societies, rights and liabilities of members, duties of
registered societies, privileges of registered societies,
property and funds of registered societies, inquiry and
inspection, supersession of committees of societies,
dissolution of societies, surcharge and attachment,
arbitration etc. We refrain from referring to the details of
the provisions except to say that they are generally
designed to further the objectives set out in the preamble.
But, numerous as the provisions are, they are not capable of
meeting the extensive demands of the complex situations
which may arise in the course of the working of the Act and
the formation and the functioning of the societies. In fact,
the too rigorous application of some of the provisions of
the Act may itself occasionally result
267
in frustrating the very objects of the Act instead of
advancing them. It is to provide for such situations that
the Government is invested by s. 60 with a power to relax
the occasional rigour of the provisions of the Act and to
advance the objects of the Act. Section 60 empowers the
State Government to exempt a registered society from any of
the provisions of the Act or to direct that such provision
shall apply to such society with specified modifications.
The power given to the Government under s. 60 of the Act is
to be exercised so as to advance the policy and objects of
the Act, according to the guidelines as may be gleaned from
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the preamble and other provisions which we have already
pointed out, are clear.
We are therefore of the view that s. 60 is not void on
the ground of excessive delegation of legislative power. We
so declare and otherwise dismiss the appeal.
N.V.K. Appeal dismissed.
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