Delegated Legislation

That silence is the argument. Because the power is vested in a named body, an unlimited right to hand it on cannot be implied: on Gwalior Rayon such a right "is not warranted by the provisions of the Constitution", and delegation is legitimate only "as an ancillary measure which the legislature considers to be necessary for the purpose of exercising its legislative powers effectively and completely".

A rule is also "law" for article 13, whose clause (3)(a) provides that "law" includes any Ordinance, order, bye-law, rule, regulation, notification, custom or usage having in the territory of India the force of law", so one violating a fundamental right is void exactly as a statute would be.

The essential legislative function

Learn this in the words of the report. Mukherjea J. in In re The Delhi Laws Act, 1912: "The essential legislative function consists in the determination or choosing of the legislative policy and of formally enacting that policy into a binding rule of conduct." The legislature may state the policy "as broadly and with as little or as much details as it thinks proper" and delegate the rest. But it "cannot part with its essential legislative function", and "a surrender of this essential function would amount to abdication of legislative powers in the eye of law".

The enquiry has three steps. Find the policy in the parent Act, its preamble and its scheme. Ask whether a standard is discernible: it need not be detailed, so long as "an intelligent guidance is given to the subordinate authority". Ask what is left to the delegate: working out and application is good, the choice of policy itself is void.

The court's restraint is part of the test: it may interfere "if no policy is discernible at all or the delegation is of such an indefinite character as to amount to abdication", but otherwise not.

Two ways of putting the limit

Two rival formulations were argued against each other in Gwalior Rayon, and a good answer names both. On the policy and standard test of Khanna J., for the majority, the question is whether the parent Act declared a policy and laid down a standard. On the abdication test of Ray C.J. and Mathew J., it is whether the legislature effaced itself, a wide delegation being saved by its retained power to repeal.

Khanna J. refused the abdication test with an example: Parliament enacts that the criminal law shall be whatever an officer named in the Act frames. "Can it be said that there has been no excessive delegation of legislative power even though the Parliament omits to lay down in the statute any guideline or legislative policy for the making of such criminal law?" The vice "cannot be ignored or lost sight of on the ground that if the Parliament does not approve the law made by the officer concerned, it can repeal the enactment".

Conditional legislation

The idea most often confused with delegation. In conditional legislation the legislature makes the whole law itself and leaves another authority only the decision whether, when or where it shall come into force. Nothing legislative is handed over, only a finding of fact. The classical statement, quoted in the Delhi Laws reference from the Privy Council in Queen v. Burah, whose own report has not been read here, is that "the proper legislature has exercised its judgment as to place, person, laws, powers and the result of that judgment has been to legislate conditionally as to all these things. The conditions having been fulfilled, the legislation is now absolute."

The first case

Facts. In re The Delhi Laws Act, 1912, (1951) 2 SCR 747, decided 23 May 1951 by seven judges. The President referred three questions under article 143, each on a section letting the executive extend to a territory, "with such restrictions and modifications as it thinks fit", any enactment in force elsewhere: section 7 of the Delhi Laws Act 1912, section 2 of the Ajmer-Merwara (Extension of Laws) Act 1947 and section 2 of the Part C States (Laws) Act 1950. The third also allowed provision "for the repeal or amendment of any corresponding law (other than a Central Act) which is for the time being applicable to that Part C State". The reference followed a Federal Court decision of 1949 holding such a power bad; that report has not been read here, so the case is not cited.

Held. Seven judges wrote seven opinions and their answers differed, so the case is quoted for its reasoning rather than for one order. What emerged, and what Gwalior Rayon later treated as the ratio, is that an unlimited right of delegation is not inherent in legislative power and that the legislature must retain the essential legislative function. The Delhi and Ajmer-Merwara sections were upheld: the policy, that a territory without a legislature should receive laws already tested elsewhere, was discernible, and "modification" was read narrowly, as alterations "which do not involve any radical change of policy". The Part C States extension power was also upheld, but its concluding words permitting repeal or amendment of a corresponding local law were held ultra vires and severable. Mukherjea J. gave the reason: "To repeal or abrogate an existing law is the exercise of an essential legislative power, and the policy behind such acts must be the policy of the legislature itself."

Why it matters. It rejects both extremes, that a legislature may delegate as freely as the British Parliament and that it may not delegate at all, and draws the working line: policy for the legislature, detail for the delegate. Repealing a law falls on the wrong side, because that is deciding policy, not applying it.

The second case

Facts. Gwalior Rayon Silk Mfg. (Wvg.) Co. Ltd v. Assistant Commissioner of Sales Tax, AIR 1974 SC 1660, (1974) 2 SCR 879, decided 21 December 1973 by five judges. Section 8(2)(b) of the Central Sales Tax Act 1956 taxed certain inter-State sales at ten per cent, or at the rate applicable to those goods inside the appropriate State, whichever is higher. The appellant said Parliament had not fixed the rate itself but tied it to whatever a State legislature might choose, had declared no policy, and had abdicated. The High Court upheld the section.

Held. The appeals were dismissed. There is "clear legislative policy" in section 8(2)(b): the central rate shall in no event be less than the local rate, the object being "to deter inter-State sales to unregistered dealers as such inter-State sales would facilitate evasion of tax". A maximum could not be fixed because local rates vary and change, their fixation being "essentially a matter for the State legislatures". On the doctrine the Court restated the Delhi Laws position: the legislature "must retain in its own hands the essential legislative functions which consist in declaring the legislative policy and laying down the standard which is to be enacted into a rule of law", and what may be delegated is only what is ancillary. Ray C.J. and Mathew J. reached the same result by the abdication route: what is prohibited is "the self-effacement of legislative power in favour of another agency either in whole or in part", and Parliament had not effaced itself, since it could repeal section 8(2)(b) at any time.

Why it matters. It is the modern statement of the test, and shows how hard the doctrine is to win on: a tax rate settled by somebody other than Parliament survived, because the Act disclosed why.

A worked example

Section 4 of a State Act provides that "the State Government may by notification make such rules as it deems fit for the regulation of shops and establishments in the State", and says nothing more. Rules made under it fix opening hours, prescribe a minimum wage and create an offence punishable with imprisonment. Farida, a shopkeeper prosecuted under the rules, challenges section 4.

Step one, identify the target. Farida attacks section 4 for excessive delegation, not the rules for being ultra vires. Different challenges, pleaded in the alternative.

Step two, look for the policy and the standard. The section says only "as it deems fit". A preamble stating that the Act is to secure the welfare of shop employees would supply a policy. Nothing here tells the Government whether to prefer trade or employees, or how a wage is to be set.

Step three, apply the test. On In re The Delhi Laws Act, 1912 the legislature has parted with the determination of policy itself, and on Gwalior Rayon no intelligible standard is enunciated. The offence-creating power is worse: a power to create a crime and fix a punishment, given without stating the conduct penalised or the penalty, is the clearest surrender of the essential function. Section 4 is void.

Step four, what if there had been a policy? The challenge shifts. Farida would attack the individual rule for going outside that policy, and that is [Ultra Vires].

What it does NOT mean

It does not mean a wide delegation is a bad one. The policy may be stated "as broadly" as the legislature thinks proper, and width alone proves nothing.

It does not mean the rule-maker is free of the Constitution. A rule is "law" under article 13(3)(a) and must satisfy Part III as well as its parent Act.

It does not mean the power to repeal is an answer. Khanna J. rejected that in Gwalior Rayon: a retained power to undo a delegation does not supply the policy the Act had to declare.

The controls

Courts are one of three. Parliamentary control comes from the parent Act's laying provisions and the Committee on Subordinate Legislation, procedural control from gazette publication and consultation, and judicial control from the two heads above.

Quick revision

• Delegated legislation is law made under a statutory power, and the parent Act is the source of its force. Articles 245 and 246 say nothing about delegating that power, so an unlimited right of delegation cannot be implied.
• The limit is the essential legislative function: determining the policy and enacting it as a binding rule of conduct. Only what is ancillary may be delegated, and only where "an intelligent guidance is given".
• In re The Delhi Laws Act, 1912: seven opinions; extension powers upheld; the power to repeal or amend a corresponding local law held ultra vires, repeal being an essential legislative act.
• Gwalior Rayon: policy and standard test per Khanna J., abdication test per Ray C.J. and Mathew J.; section 8(2)(b) upheld.
• Conditional legislation is not delegation: the law is complete, only its commencement or extension being left to another.
• Controls are parliamentary, procedural and judicial. Excessive delegation attacks the Act; ultra vires attacks the rule.

Test yourself

1. Define the essential legislative function in the words of the report, and say what follows if a legislature parts with it.

2. Articles 245 and 246 say nothing about delegation. How does that silence shape the doctrine?

3. Distinguish delegated from conditional legislation, and say what is challenged in each.

4. Set out the two formulations in Gwalior Rayon, and Khanna J.'s objection to the abdication test.

5. What was held ultra vires in the Delhi Laws reference, and why?

6. A statute lets a board make rules "for carrying out the purposes of this Act" and fine any amount. Advise.