Registrar of Co-Operative Societies,
Trivandrum & ANR Vs. K. Kunhambu & Ors [1979] INSC 250 (27 November
1979)
REDDY, O. CHINNAPPA (J) 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 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 261 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.
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 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 263 despotism uninhibited. So the theory has
been evolved that the legislature cannot delegate its essential legislative
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 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 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 266 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 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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