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PETITIONER: MUNICIPAL CORPORATION OF DELHI

       Vs.

RESPONDENT: BIRLA COTTON, SPINNING AND WEAVING MILLS, DELHIAND ANOTHER

DATE OF JUDGMENT: 23/02/1968

BENCH: WANCHOO, K.N. (CJ) BENCH: WANCHOO, K.N. (CJ) HIDAYATULLAH, M. SHAH, J.C. SIKRI, S.M. RAMASWAMI, V. SHELAT, J.M. VAIDYIALINGAM, C.A.

CITATION:  1968 AIR 1232            1968 SCR  (3) 251  CITATOR INFO :  F          1970 SC1589  (7)  RF         1971 SC2100  (20)  RF         1973 SC1374  (11)  RF         1973 SC1461  (22M,450,464,566)  R          1974 SC1660  (10,16,17,35,49)  R          1975 SC1007  (14)  RF         1978 SC1457  (6)  RF         1979 SC 321  (21,22)  RF         1979 SC1475  (17,21)  RF         1981 SC 951  (3)  RF         1982 SC1126  (9)  R          1986 SC 515  (71)  R          1990 SC 560  (13)

ACT: Delhi  Municipal Corporation Act 66 of 1957 ss. 113 and  150 Power  to  Corporation  under ss. 113(2)  and  150  to  levy optional  taxes subject to Central Government’s  approval-if excessive delegation and therefore ultra vires. Delhi Municipal Corporation (Validation of Electricity  Tax) Act  35  of 1966-Whether effectively validated levy  of  tax between July 1, 1959 and March 31, 1966. Constitution of India, Art. 77-Central Government’s sanction signed  by Deputy Secretary without the words "By  order  of the  President" or similar words-Whether deficiency made  up by subsequent affidavit stating approval given by  minister- If Deputy Minister assigned certain work can give  effective approval-or whether matter must go to Cabinet Minister also.

HEADNOTE: On  February  9, 1959, the appellant  Corporation  passed  a resolution  under  section  150(1) of  the  Delhi  Municipal Corporation  Act  66 of 1957 for the levy of  certain  taxes including  a tax on the consumption or sale of  electricity. Under  s. 150(2) the Central Government sanctioned  the  tax with effect from July 1, 1959 and also modified the rates of tax.   The  Corporation resolved on June 24, 1959  under  s.

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150(3)  to  determine the rates sanctioned  by  the  Central Government  as the rates at which the tax would be  leviable for the year 1959-60.  The respondent challenged the levy of the  tax by a writ petition which was allowed in appeal  and it  was held, inter alia, that the Central Government  could not modify the rate,, but only withhold or grant sanction. Parliament  then passed Act 35 of 1966 to validate the  levy of the electricity tax from July 1, 1959 to March 31,  1966. On  February  17,  1965,  the  Corporation  passed   another resolution  under s. 150(1) providing for the maximum  rates for  the levy of tax on electricity and after obtaining  the Central Government"s sanction, passed a second resolution on December 27, 1965, tinder s. 150(3) fixing the maximum rates as  the  actual  rates.   The  respondents  filed  two  writ petitions challenging the levy of tax by the resolutions  of February  17,  and December 27, 1965, and the vires  of  the Validation  Act.   The  High  Court  allowed  the  petitions holding  that though the Validation Act validated  the  levy and collection of tax from July 1, 1959 to March 31, 1960 it did  not do so for the period from April 11, 1960  to  March 31,  1966. it also held that section 150 suffered  from  the vice  of excessive delegation of legislative power  and  was therefore  ultra  vires.  The respondent  appealed  to  this Court. HELD  : (i) (By the Full Court) : The Validation Act  35  of 1966  validly levies and imposes tax on consumption or  sale of electricity till March 31, 1966. (Per Wanchoo, C. J. and Shelat, J.) : The High Court was  in error in holding that levy and collection of the tax was not validated for the 252 period  from  April 1, 1960 to March 31, 1966 and  that  the Validation Act merely validated the fixation of the rate  of tax  for that period.  When section 2(1) lays down that  the rates  deducible from the resolution of June 24, 1959  shall be  the actual rates of tax for the entire period from  July 1, 1959 to March 31, 1966 it must be understood to  sanction the levy and collection of tax at the rates fixed.  This  is implicit  in  the  word ..actual" which  governs  the  words "rates  of  the tax".  Even if there was some doubt  in  the matter from the words of s. 2(1), that doubt is resolved  by the words of s. 2(2), which lays down that "all taxes on the consumption  or sale of electricity levied or  collected  or purporting to have been levied or collected in pursuance  of the resolution referred to in subsection (1) shall, for  all purposes,  be deemed to be, and to have always been  validly levied or connected." This clearly shows that the validation "as not merely of the rate of tax but of levy and collection also  for the entire period from July 1, 1959 to  March  31, 1966.  A reading of s. 2(1) and s. 2(2) together shows  that Parliament not only validated what was done but also  itself imposed the rates deducible from the resolution of June  24. 1959 and authorised the levy and collection thereof for  the entire   period  from  July  1,  1959  to  March  31,   1966 notwithstanding  anything contained in any judgment,  decree or order of any court to the contrary. 1276 H-278 B] (ii) (Per Wanchoo, C.J. and Shelat, J.) : On a consideration of  the various provisions of the Act, it must be held  that the  power  conferred  by  section 150 of  the  Act  on  the Corporation is not unguided and cannot be said to amount  to excessive  delegation.   Although  the  delegation  made  in relation  to the optional taxes under ss. 113(2) and 150  is wide,  there are sufficient guidelines, limits, controls  or safeguards  provided  by  the legislature  in  view  of  the following : (a) The delegation has been made to an,  elected

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body  responsible to the people including those who pay  the taxes; this is an important check on the elected Councillors acting   unreasonably  and  fixing  unreasonable  rates   of taxation; (b) the limit to which the Corporation can tax  is circumscribed  by  the  need  to  finance  the   functions,’ obligatory or optional, which it has to or may undertake  to perform,  under  the  Act.   It will  not  be  open  to  the Corporation by the use of taxing power to collect more  than it needs for the functions it performs; though the mere fact that  specific purposes and functions are set out in an  im- pugned  Act may not be conclusive it is one of  the  factors which should be taken into account along with other relevant factors;  (c) budget estimates have to be adopted each  year as  laid down in section 109 of the Act; (d)  under  section 150(2),  the maximum rates fixed by the Corporation have  to be  submitted  to the Central Government for  its  sanction; though therefore the legislature may not have provided  that the rates of tax shall be submitted to it for approval,  the fact  that  they  have to be  submitted  to  Government  for approval  and the Government in its turn is  responsible  to the  legislature  is  a factor which has to  be  taken  into account  when considering whether the delegation by  section 150 of the Act is excessive or not. [275 B; 271 D; 272 D; H; 273 E] Furthermore,  should  the Corporation fix  rates  which  are unreasonable it would always be open to the Courts to strike down  such  import.   Kruse Johnson,  [1898]  2  Q.B.D.  91; referred to. [274 E] Under  certain circumstances fixation of rates  of  taxation can also be delegated to subordinate authorities with proper guidance and subject to safeguards and limitations. Pandit  Banarsi Das Bhanot v. The State of  Madhya  Pradesh, [1959] S,C.R. 427; considered. 253 There is a clear distinction between delegation of power  to fix the rate of a tax like sales tax to the State Government and delegation of fixing rates of certain taxes for purposes of local taxation.  The needs of the State are unlimited and the purposes for which the State exists are also  unlimited. On  the other hand, in the case of a  municipality,  however large may be the amount required by it for its purposes,  it cannot  be limited, for the amount that a  municipality  can spend  is limited by the purposes for which it  is  created. [268 D-G] (Per Hidayatullah and Ramaswami, JJ.) : While the provisions which  have  been characterised as safeguards  (where  found necessary)  are desirable, the proper test to apply  is  not the existence of safeguards but whether the legislative will to  impose  the tax is adequately expressed so  as  to  bind those who have to pay the tax.  This requires an examination of  the  policy  and provisions of the Act with  a  view  to determining whether the legislative will is fully  expressed to  invest the Municipal Corporation with the power to  levy the  tax  subject, of course, to a  proper  procedure  being evolved. [280 D, E] The doctrine that Parliament cannot delegate its powers must be  understood  in a limited way.  It only  means  that  the legislature  must  not  efface  itself  but  must  give  the legislative  sanction to the imposition of the tax and  must keep  the  control in its own hands.  There is  no  specific provision in the Constitution which says that the Parliament cannot  delegate to certain specified instrumentalities  the power  to effectuate its own will.  The question  always  is whether  the  legislative will has been  exercised  or  not. Once  it  is  established that the  legislature  itself  has

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willed  that a particular thing be done and has merely  left the  execution of it to a chosen  instrumentality  (provided that  it  has not parted with its control there  can  be  no question  of  excessive delegation.  If  the  delegate  acts contrary  to the wishes of the legislature, the  legislature can undo what the delegate has done.  Even the courts may be asked to intervene when the delegate exceeds its powers  and functions.  The observations and theories in American  cases cannot  be applied in our country without reflection.   Even in America the doctrine is much watered down especially when it  is a question of investing municipalities with power  of such  taxation.   In  the  present  case,  in  addition   to prescribing  the mode, The legislature has kept a  check  by making  Government,  answerable to itself,  the  supervising authority.   This is no,, a safeguard. but is indicative  of the  exercise  of the legislative will  by  the  legislature itself.  The details of the tax are to be considered by  the supervising  authority  and  if  the tax  is  no’  what  the legislature  intended should be imposed, the tax  cannot  be imposed. [287 E-G] As  local  bodies  are  intended to  carry  on  local  self- government, the power of taxation is a necessary adjunct  to their other powers.  They function under the supervision  of the  Government.  This supervision is  considered  necessary because Municipal Councillors as a rule are unwilling to lax in a manner likely to affect themselves.  To insist that the legislature  should provide for every matter connected  with municipal  taxation  would  make  municipalities  mere   tax collecting departments of Government and not  self-governing bodies which they are intended to be. [288 E, F] (Per  Sikri,  J.) :. Parliament has full  power  to  delegat legislative  authority  to subordinate bodies.   This  power flows  from  Act.  246  of  the  Constitution.   The,   word exclusive"  in  that Article means exclusive  of  any  other legislature  and not exclusive of subordinate  body.   There is,  however,  one restriction in this respect and  that  is also  contained in Art. 246.  Parliament must pass a law  in respect  of  an item or items of  the  relevant  legislative list.    Negatively,  this  means  that  Parliament   cannot abdicate  its  functions.  This was the Position  under  the various Government of India 254 Acts,  and the Constitution has made no difference  in  this respect.[ 1309 H-3 I 0 B] In any event however, in the, present case there is adequate guide, or policy, in the expression "purposes of the Act" in s.  113.   The Act has pointed out the  objectives  or  the- results to be achieved, and taxation can be levied only  for the  purpose  of achieving the objectives  or  the  results. This  is sufficient guidance especially to a  self-governing body  like  the  Delhi Municipal  Corporation.   It  is  not necessary   to  rely  on  the  safeguards  to  sustain   the delegation under s. 113(2) and s. 150. [310 G] (Per-  Shah  and  Vaidialingam, JJ.  dissenting)  :  Section 150(1) of the Act 66 of 1957 is void as permitting excessive delegation of legislative authority to the Corporation. Authority to legislate in respect of powers of local  bodies may  encompass  authority  to confer power  upon  the  local bodies  to  tax  within  certain  specific  fields  in   the appropriate   list.    But  the  power  conferred   by   the legislative   entry  cannot  override   the   constitutional limitations  against  abdication of  legislative  authority. The expression "power" therefore does not include  authority to  delegate  the  essential  legislative  function  without disclosing principles, policy, or standard guiding the local

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bodies in the exercise of the Dower. [302 C-D] The  vice of delegation lies not in its capacity for  abuse, but in its delegation beyond permissible limits and contrary to the constitutional scheme.  Undoubtedly delegation of the authority  to legislate is always subject to the  rule  that action  of  the  delegate  which  amounts  to   unreasonable exercise  of the powers wilt be invalid.  But that does  not alter  the  true  character of the  rule  against  excessive delegation of legislative authority.  It cannot be said that this  rule  may  be departed from on  the  ground  that  the delegate is hedged in by controls or restrictions which will prevent  it from abusing its authority.  Safeguards  against abuse do not alter the character of unauthorised  delegation of  legislative power.  They cannot be a substitute for  the guidance  which the constitutional scheme requires that  the Parliament must give to a delegate.  As the validity of  the constitutional  protection cannot be judged in the light  of what the character. capacity or the special aptitude of the, delegate may be, it cannot also be adjudged in the light  of the provisions made against abuse of power. In the present case the Act leaves it to the, Corporation by resolution to define the maximum limits of tax to be levied, the   class  or  classes  of  persons,  or  description   or descriptions  of  articles and properties to be  taxed,  the system  of assessment to be adopted and the  exemptions,  if any, to granted.  The Act discloses by express enactment  no standard,  no  principle  and no policy  laid  down  by  the Parliament   to  guide  the  Corporation  in   levying   and collecting the optional taxes.  By providing in  sub-section (2) of s. 150 that the resolution will come into force on or from  the date as may be specified in the order of  sanction of  the  Central  Government,  an  overriding  authority  is conferred  upon  the  Union  Executive,  but  that  is   not substitute for, guidance. [303 C-E] The  Corporation  is competent to levy tax  only  "for  the, purposes  of  the  Act", and for no other  purpose,  and  by providing  expressly what is implicit in a statute  relating to  municipal  taxation  no guidance  is  furnished  to  the Corporation  in  the exercise of the  power  delegated.   It cannot  be  held  that  because  the  delegate  is  a  local authority which "needs" large funds, depending upon  diverse and  changing  circumstances, the power conferred  upon  the Corporation  to adjust the tax to its varying needs  may  be regarded  as an adequate guide.  The circumstance  that  the affairs of  255 the   Corporation   are   administered   by   the    elected representatives responsible the people is wholly  irrelevant in determining whether the rule against excessive delegation may  be  departed  from.  If that  exception  be  true,  the Parliament may justifiably delegate its power to enact  laws to  other  bodies merely by the  expedient  of  constituting those bodies from among the representatives of the people. Case law  reviewed. (iii)     (Per- Wanchoo C.J. and Shelat, J.) : There wits no force  in  the contention that the sanction of  the  Central Government given under section 150(2) was not in  accordance with the Constitution as it was given by a Deputy  Secretary to  the Government who had no authority to do 8o.   Although the words "by the orders of the Central Government" or "  by ,.he  order  of  the  President" were  not  used  above  the signature  of  the Deputy Secretary and  the  authentication therefore was not quite in accordance With the provisions of Art.  77 of the Constitution, that deficiency had been  made up  by  the  affidavit  filed  on  behalf  of  the   Central

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Government  in which it was stated that the  resolution  was approved  by the then Deputy Home Minister and the  Minister in the Ministry of Home Affairs to whom the work relating to the   Corporation  was  assigned  by  the   Home   Minister. Furthermore,  it  is not necessary where business  has  been assigned  by  a Cabinet Minister to a Minister or  a  Deputy Minister  that the matter should be put before  the  Cabinet Minister also after the Minister or the Deputy Minister  has approved of it in accordance with the assignment made in his favour. [275 E-276 D]

JUDGMENT: CIVIL  APPELLATE JURISDICTION : Civil Appeals Nos. 1857  and 1858 of 1967. Appeals from the judgment and order dated October 9, 1967 of the Delhi High Court in Civil Writ No. 105 of 1967, and Writ Petition No. 564-D of 1966 respectively. C.   K.  Daphtary  Attorney-General, H. R.  Gokhale,  D.  D. Chawla  and  K. Rajendra Chaudhuri, for  the  appellant  (in both .,he appeals). A.   K. Sen, B. Parthasarthy, J. B.Dadachanji and Ravinder for- respondent No. 1 (in both the appeals). R.   N. Sachthey for respondent No. 2 (in both the appeals). M.   K. Nambiyair, D. R. Thadani, Dalip K. Kapur, Bhuvanesh Kumari, J. B. Dadachanji and Ravinder Narain, for intervener No.  1. N. A. Palkhivala, J. B. Dadachanji, and Ravinder Narain, for  interveners Nos. 2, 5 and 6. Purshottam  Trikaindas and I. N. Shroff, for intervener  No. 3. S. T. Desai and 1. N. Shroff, for intervener No. 4. The  Judgment of WANCHOO, C.J. and SHELAT, J. was  delivered by  WANCHOO,  C.J., HIDAYATULLAH, J.  delivered  a  separate Judgment  on behalf of himself and RAMASWAMI, J., SIKRI,  J. delivered  a  separate  Judgment.   SHAH,  J.  delivered   a dissenting opinion on behalf of himself and VAIDIALINGAM, J. 256 Wanchoo,  C.J. These two appeals on certificates granted  by the  High Court of Delhi raise common questions relating  to the  constitutionality  of delegation of ’taxing  powers  to municipal corporations and the effect of the Validation Act, passed  by  Parliament,  in  connection  with  tax  on   the consumption  or sale of electricity levied by the  Municipal Corporation  of  Delhi  (hereinafter  referred  to  as   the Corporation) from July 1, 1959 to March 31, 1966.  The facts are not in dispute and may be briefly narrated.  On February 9,  1959, the Corporation passed a resolution purporting  to be  under sub-section (1) of s. 150 of the  Delhi  Municipal Corporation Act, No. 66 of 1957. (hereinafter referred to as this  Act) for levy of three taxes, including a tax  on  the consumption or sale of electricity.  Section 113 of the  Act which confers powers on the Corporation to impose taxes  has divided them into two kinds, namely, obligatory taxes, which the  Corporation must impose [s. 113(1), and optional  taxes which  the Corporation may impose section 113(2)1Further  s. 150(1)  of the Act provides that maximum rate of tax  to  be levied  in the case of optional taxes will be  specified  by resolution  of the Corporation.  After the maximum rate  has thus  been specified, the resolution has to be submitted  to the Central Government for sanction under s. 150(2), and  if sanctioned  by Government, the rate comes into force on  and from  such  date  as  may be  specified  in  the,  Order  of sanction.   Under subsection (3) of s. 150  the  Corporation

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then passes another resolution determining the actual  rates at  which the tax is levied and the tax comes into force  on the first day of the quarter of the year next following  the date  on  which  such  second  resolution  is  passed.   The Corporation forwarded the resolution dated February 9,  1959 which was somewhat defective inasmuch as it did not  specify the  maximum rates, but merely the rates, which were  to  be enforced  for the ensuing year, to Government for  sanction. On June 20, 1959, the Central Government sanctioned the  tax on consumption or sale of electricity with effect from  July 1,  1959.   In giving the sanction  the  Central  Government modified  the  rates.   On  June  23,  1959,  the   Standing Committee  took the Government sanction  into  consideration and  recommended  to the Corporation that rates  of  tax  as sanctioned  by Government be determined under sub-s. (3)  of s.  150  as  the  actual rates at which  the  tax  would  be leviable  for  the  year 1959-60.  On  June  24,  1959,  the Corporation   resolved  that  the  recommendations  of   the Standing  Committee regarding tax on consumption or sale  of electricity  be  approved.   Then followed  demands  by  the Corporation on the basis of the imposition of tax from  July 1, 1959. When  the tax was demanded from the respondent, it  filed  a writ petition in the High Court challenging the levy of  the tax.   This writ petition was dismissed by a learned  Single Judge.  The  257 respondent then went in appeal, and the appeal court allowed the   appeal  holding  inter  alia  (i)  that  the   Central Government  could  not  modify the rates  specified  in  the resolution  under s. 150 (1) but could only either  withhold sanction  thereto  or  sanction  them,  and  (ii)  that  the liability  to pay tax could not commence earlier than  April 1, 1960 in view of the provisions contained in s. 109(2) read with s. 150(4) of the Act. On  December 3, 1966, Parliament passed the Delhi  Municipal Corporation  (Validation of Electricity Tax) Act, No. 35  of 1966  (hereinafter referred to as the Validation  Act).   By this  Act, it purported to validate the levy of  electricity tax  from  July  1,  1959  to  March  31,  1966  (both  days inclusive).   In view of the Validation Act,  fresh  demands were made by the Corporation on the respondent. On  February 17, 1965, the Corporation passed another  reso- lution  in  pursuance of s. 150(1) and  this  time  provided maximum rates for the levy of tax on consumption or sale  of electricity.   These rates were higher than the rates  fixed by the resolution of February 9, 1959.  This resolution  was submitted  to Government and was sanctioned on  December  8, 1965.    Thereafter  the  Corporation  passed   the   second resolution  under  s. 150(3) of the Act resolving  that  the maximum rates should be adopted as the actual rates for  the levy  of  tax.  This resolution was passed on  December  27, 1965.   Then followed two writ petitions by the  respondent. By the first writ petition it challenged the levy of tax  by resolutions of February 17 and December 27, 1965, and by the second  writ petition the appellant challenged the vires  of the Validation Act. We may now refer to the grounds of the challenge.  So far  s the  Validation Act is concerned, it is contended  that  the Validation  Act has failed in its object inasmuch as it  did not  provide  for the levy of tax and merely  validated  the rates  fixed  by  the resolution of June  24,  1959.   Other grounds  were  also stressed in this connection  but  it  is unnecessary  to refer to them as they have not been  pressed before  us.   As  to the attack  on  the  resolutions  dated

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February 17, 1965 and December 27, 1965, the main contention is  that S. 150 is unconstitutional inasmuch as  it  suffers from  the vice of excessive delegation of legislative  power and  is therefore ultra vires and no tax could be levied  by the  Corporation  thereunder.  There are  some  other  minor points  raised  in this connection to which we  shall  refer later. The  High Court held, so far as the Validation Act  is  con- cerned, that though it validated the levy and collection  of tax  from  July  1, 1959 to March 31,  1960,  it  failed  to validate the levy and collection from April 1, 1960 to March 31, 1966 on 258 the  ground  that there was no levy of tax for  this  latter period,  even  though  the  rates  were  specified  in   the Validation  Act.  On the question of  excessive  delegation, the  High Court held that s. 150 suffered from the  vice  of excessive delegation of legislative power and was  therefore ultra  vires.   In  consequence,  the  two  writ   petitions succeeded except as to the period from July 1, 1959 to March 31,  1960.   The Corporation then applied for  and  obtained certificates  and that is how the matter has come up  before us. Before  we deal with the main question that has been  argued before  ’us, namely, whether s. 150 of the Act suffers  from the  vice of excessive delegation, we may briefly  refer  to certain  provisions  of the Act which are material  for  our purposes.   Section  of the Act creates a  Corporation  from such  date as the Central Government may by notification  in the  official  gazette,  appoint  and  this  Corporation  is charged with the municipal government of Delhi and is to be, known  as the Municipal Corporation of Delhi.  Section 7  of the  Act  provides  that the persons  entitled  to  vote  at elections of councillors shall be the persons registered  by virtue  of  the  provisions  of  the  Constitution  and  the Representation of the People Act, No. 43 of 1950, as  voters at  elections to the House of the People.  It will  be  seen therefore  that  the  Councillors  of  the  Corporation  are elected  by universal adult suffrage.  The total  number  of councillors  is  80 and to these are added 6  eldermen,  and they  together form the Corporation.  Section 42  lays  down certain obligatory functions of the Corporation.  It is  not necessary  to refer to them in detail; it is enough  to  say that  the main obligatory functions of the Corporations  are the  supply  of Water for public and private  purposes,  the construction,  maintenance  and  cleansing  of  drains   and drainage  works  and  of public  latrines,  the  scavenging, removal and disposal of filth, the construction or purchase, maintenance,  extension, management and conduct of  (i)  any undertaking for the generation or supply and distribution of electricity  to  the public, and (ii)  any  undertaking  for providing road transport services by mechanically  propelled vehicles,  the establishment and maintenance  of  hospitals, dispensaries  and  maternity and child welfare  centres  and carrying out of other measures necessary for public  medical relief,  the  construction  and  maintenance  of   municipal markets  and  slaughter houses and regulation  thereof,  the construction,  maintenance,, alteration and improvements  of public  streets, brides, culverts, causeways and  the  like, the  lighting, watering and cleansing of public streets  and other public places, the establishment, maintenance of,  and aid to, schools for primary education and the maintenance of a  fire-brigade and the protection of life and  property  in case of fire.  259

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Section   43   provides  for  optional  functions   of   the Corporation  which  it may in its discretion provide  and  a large number of such functions are enumerated therein.  Some of  these  optional functions are :  the  establishment  and maintenance   of,  and  aid  to,  libraries,  museums,   art galleries,   botanical   of  zoological   collections,   the providing of music or other entertainments in public  places or places of public resort and the establishment of theatres and  cinemas, the construction and maintenance of  (i)  rest houses, (ii) poor houses, (iii) infirmaries, (iv) children’s homes, (v) houses for the deaf and dumb and for disabled and handicapped  children,  (vi)  shelters  for  destitute   and disabled  persons, and (vii) asylums for persons of  unsound mind,   the  Organisation  or  management  of  chemical   or bacteriological laboratories for the examination or analysis of  water, food, and drugs for the detection of diseases  or research connected with public health or medical relief; the provision for relief to destitute and disabled persons;  the establishment  and maintenance of veterinary hospitals;  the Organisation,  construction, maintenance and  management  of swimming pools, public wash houses, bathing places and other institutions designed for the improvement of public  health; the organisation and management of farms and dairies  within or   without   Delhi  for  the  supply,   distribution   and processing, of milk and milk products for the benefit of the residents  of  Delhi;  the Organisation  and  management  of cottage  industries, handicraft centres and  sales  emporia; the  provision for unfiltered water supply; the  improvement of Delhi in accordance with improvement schemes approved  by the Corporation; and the provisions of housing accommodation for  the  inhabitants  of  any area  or  for  any  class  of inhabitants. These duties, both obligatory and optional, which have  been placed  on the Corporation require large funds and for  that purpose  the  Corporation has been given the power  to  levy taxes under S. 113 of the Act.  Section 113 consists of  two subsections; ’the first sub-section provides for  obligatory taxes and they are six in number.  These six taxes have been dealt  with  in detail in sections 114 to 149.   It  is  not necessary  to  refer  to  these,  sections  except  ’lo  say generally  that in most cases the Act has fixed G a  maximum for  the obligatory taxes except in the case of  water  tax, scavenging  tax and fire tax, the rates of which have to  be fixed at a reasonable amount by the Corporation.  Then comes s.  150, which deals with optional taxes and with  which  we are particularly concerned.  If reads thus :               "(1) The Corporation may, at a meeting, pass a               resolution  for the levy of any of  the  taxes               specified  in sub-section (2) of section  113,               defining  the  maximum rate of the tax  to  be               levied, the class or classes of               260               persons or the description or descriptions  of               articles  and  properties  to  be  taxed,  the               system  of assessment to be, adopted  and  the               exemptions, if any, to be granted.               (2)   Any  resolution passed under  subsection               (1)   shall  be  submitted  to   the   Central               Government for its sanction, and if sanctioned               by  that Government, shall come into force  on               and from such date as may be specified in  the               order of sanction.               (3)   After  a resolution has come into  force               under  subsection  (2), the  Corporation  may,               subject  to  the maximum rate, pass  a  second

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             resolution  determining  the actual  rates  at               which  the tax shall be leviable; and the  tax               shall come into force on the first day of  the               quarter of the year next following the date on               which such second resolution is passed._               (4)   After   a   tax  has  been   levied   in               accordance  with the fore going provisions  of               this  section, the provisions  of  sub-section               (2) of section 109, shall apply in relation to               such tax as they apply in relation to any  tax               imposed under sub-section (1) of section 113." It will be, seen that sub-section (1) of s. 150 leaves it to the Corporation, at a meeting, to pass a resolution for  the levy of any of the optional taxes by prescribing the maximum rate.   The Corporation is also given the power to  fix  the class   or  classes  of  persons  or  the   description   or descriptions  of  articles and properties to be  taxed,  for this purpose.  It has also the power to lay down the  system of  assessment and exemptions, if any, to be  granted.   The contention  of the respondent is that s. 150  (1)  delegates completely  unguided power to the Corporation in the  matter of  optional  taxes and suffer from the  vice  of  excessive delegation and is unconstitutional. We may also refer to certain other sections which deal  with revenue  and  expenditure of the  Corporation.   Section  99 deals with the constitution of the municipal fund, in  which all moneys of the Corporation go.  Section 109 provides  for adoption  of  budget  estimates.   It  lays  down  that  the Corporation  shall  on or before the 31st day  of  March  of every year adopt for the ensuing year four budget estimates, namely, (i) budget estimates (general), (ii) budget estimate (electric  supply), (iii) budget estimated  (transport)  and (iv)  budget  estimate (water supply and  sewage  disposal). Section  109(2) lays down that on or before the 15th day  of February  of each year, the Corporation shall determine  the rates  at  which various municipal taxes, rates  and  cesses shall  be  levied in the next following year.   Section  102 inter alia provides that no payment of any sum out of the  261 municipal  fund shall be made unless the expenditure of  the same is covered by a current budget-grant. It  is  in  the light of these provisions that  we  have  to consider  whether the delegation made to the Corporation  by S.  150 in the matter of imposing optional taxes  is  within the  permissible  limits of delegation.  The  contention  on behalf of the appellant is that in view of these  provisions there  is  sufficient  guidance to the  Corporation  in  the matter  of  fixing the rates of optional taxes  and  levying them  on the inhabitants of the area and it cannot  be  said that  Parliament by enacting s. 150 transgressed the  limits of permissible delegation. The question as to the, limits of permissible delegation  of legislative   power  by  a  legislature  to  a   subordinate authority  has come before this Court in a number  of  cases and the law as laid down by this Court is not in doubt  now. Considering  the complexity of modern life it is  recognised on  all hands that legislature cannot possibly have time  to legislate in every minute     detail.   That is why  it  has been  recognised  that  it is open  to  the  legislature  to delegate  to  subordinate  authorities  the  power  to  make ancillary  rules  for  the  purpose  of  carrying  out   the intention  of  the legislature indicated in  the  law  which gives power to frame such ancillary rules.  The matter  came before this Court for the first time In The Delhi Laws  Act, 1912(1),  and it was held in that case that it could not  be

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said  that an unlimited right of delegation was inherent  in the legislative power itself.  This was not warranted by the provisions  of the Constitution, which vested the  power  of legislation either in Parliament  or State legislatures  and the legitimacy of delegation depended upon its being used as an ancillary measure which the legislature considered to  be necessary  for  the purpose of  exercising  its  legislative powers  effectively  and completely.  The  legislature  must retain in its own hands the essential legislative  function. Exactly what  constituted     essential          legislative function", it was held further,    was  difficult to  define in general terms, but this much was clear    that        the essential legislative function must at least consist of  the determination of the legislative policy and its  formulation as a binding rule of conduct.  Thus where the law passed  by the  legislature  declares the legislative policy  and  lays down  the standard which is enacted into a rule of  law,  it can  leave the task of subordinate legislation which by  its very  nature  is  ancillary to the  statute  to  subordinate bodies, i.e., the making of rules, regulations or  bye-laws. The  subordinate authority must do so within the  frame-work of the law which, makes the delegation, and such subordinate legislation  has to be consistent with the  law under  which it is made and cannot go beyond the (1)  [1951] S.C.R. 747. 262 limits  of  the policy and standard laid down  in  the  law. Provided   the   legislative  policy  is   enunciated   with sufficient clearness or I standard is laid down, the  courts should  not interfere with the discretion  that  undoubtedly rests  with  the  legislature itself  in  determination  the extent of delegation necessary in a particular case. In  Raj  Narain Singh v. The Chairman  Patna  Administration Committee(1)  the same question arose and it was  held  that "air  executive authority can be authorised by a statute  to modify  either  existing  or  future laws  but  not  in  any essential  feature.  Exactly what constitutes  an  essential feature  cannot  be enunciated in general terms  but  it  is clear  that modification cannot include a change of  policy. Essential legislative function consist it the  determination of the legislative policy and its formulation as  a  binding rule of conduct." In  Harishankar  Bagla  v.  The  State  of  Madhya   Pradesh 2 s. 3.  of the Essential Supplies (Temporary  Powers)  Act, 1946  was  attacked  as unconstitutional on  the  ground  of excessive  delegation  of legislative power.  In  that  case reliance was placed on the re in Delhi Law Act(1) where  the majority  held  that "the essential  powers  of  legislation cannot  be delegated and that 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 empowered to  execute  the  law. Applying these principles this Court held that the Act there impugned had laid down the principle and that principle  was the   maintenance  or  increase  in  supply   of   essential commodities  and  of  securing  equitable  distribution  and availability at fair prices.  It was further held that  this sufficiently formulated the legislative policy and the ambit and tile character of that Act Was such that the details  of that  policy  could only be worked out  by  delegating  that power  to a subordinate authority within the  frame-work  of that  policy.   The Court therefore held that s.  3  of  the impugned  Act  was not ultra vires the  legislature  on  the ground of excessive delegation of legislative power. In  the Western India Theatres Limited v.  Municipal  Corpo-

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ration  of  the  City of Poonia(4), a  question  arose  with respect  to the Bombay District Municipal Act,  1901,  which gave power to the municipality to levy "any other tax to the nature  and object of which the approval of the Governor  in Council  shall  have been obtained prior  to  the  selection contemplated in sub-cl. (i) of cl. (a) of section 60".  This provision  was  attacked as unconstitutional on  the  ground that  the legislature had completely abdicated its  function and   delegated   essential   legislative   power   to   the municipality  to  determine  the nature of  the  tax  to  be imposed (1)  [1955] 1 S.C.R. 290. (2)  [1951] 1 S.C.R. 380. (3)  [1951] S.C.R. 747. (4)  [1959] Suppl. 2. S.C.R. 71.  263 on the rate payers and that power was unguided,  uncanalised and  vagarant.  The delegation was upheld by this  Court  on the ground that s. 59 authorised the municipality to  impose tax  thereunder for the purposes of the Act.  The Act  there under  consideration defined the obligations  and  functions cast  upon the municipality and it was observed  that  taxes could only be levied for implementing those purposes and not for  any  other purpose.  It was finally observed  that  the impugned  section  did  lay down  the  procedure  which  the municipality  had  to  follow  in imposing  a  tax  and  the legislature  could not in the circumstances be said to  have abdicated its function in favour of the municipality. In  Hamdard Dawakhana (Wakf) Lal Kuan v. Union of  India(1), this Court struck down one provision of the impugned Act  as the legislature had established no criterion or standard and had  not  prescribed any princple on  which  the  particular disease  or condition was to be specified.  It will be  seen that  the  same  principle that the  legislature  could  not delegate unguided, power to a subordinate body was the basis of this decision. In Vasantlal Maganbhai Sanianwal v. The State of  Bombay(1), the question of delegation of legislative power arose.  This Court enunciated the principle thus :               "Although   the  power  of  delegation  is   a               constituent element of the legislative  power,               it  is well-settled that a legislature  cannot               delegate its essential legislative function in               any  case  and  before  it  can  delegate  any               subsidiary  or ancillary powers to a  delegate               of   its   choice,  it  must  lay   down   the               legislative  policy  and principle  so  as  to               afford   the  delegate  proper   guidance   in               implementing  the same.  A statute  challenged               on  the  ground of excessive  delegation  must               therefore  be  subjected  to  two  tests,  (1)               whether  it  delegates  essential  legislative               function   or  power  and  (2)   whether   the               legislature  has  enunciated  its  policy  and               principle for the guidance of the delegate." In  jyoti Pershad v. The Administrator for the Union  Terri- tory  of  Delhi(3),  in  connection  with  the  Slum   Areas (Improvement  and Clearance) Act, 1956 it was observed  that "so  long  as the legislature india cated in  the  operative provisions  of  the staute with certainty,  the  policy  and purpose of the enactment, the mere fact that ’he legislation was skeletal or that very detail of the applicaion of law to a particular case, was not laid down in (1) [1960] 2 S C.R. 671.        (2) [1961] 1 S.C.R. 341. (3) [1962] 2 S.C.R. 125.

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L6Sup.C.I/68-4 264 the enactment itself or the fact that a discretion was  left to  those entrusted with administering the law, afforded  no basis  either  for  the contention that there  had  been  an excessive  delegation of legislative power so as. to  amount to  an abdication of its functions, or that  the  discretion vested  was  uncanalised and unguided so as to amount  to  a carte blanche to discriminate." The  last  case to which reference may be made is  Devi  Das Gopal Krishnan v. State of Punjab(1).  There the law on  the subject of excessive delegation on was summarised thus at p. 1901:               "The Constitution confers a power and  imposes               a  duty on the legislature to make laws.   The               essential   legislative   function   is    the               determination  of the legislative  policy  and               its  formulation  as a rule of  conduct.   Ob-               viously  it cannot abdicate its  functions  in               favour  of  another.   But  in  view  of   the               multifarious activities of a welfare State, it               cannot presumably work out all the details  to               suit  the varying aspects of a complex  situa-               tion.    It  must  necessarily  delegate   the               working out of details to the executive or any               other agency.  But there is danger inherent in               such  a  process  of  delegation.   An   over-               burdened  legislature  one  controlled  by   a               powerful  executive  may unduly  overstep  the               limits of delegation.  It may not lay down any               policy  at all; it may declare its  policy  in               vague  and general terms; it may not set  down               any   standard   for  the  guidance   of   the               executive; it may confer an arbitrary power on               the  executive to change or modify the  policy               laid  down by it without reserving for  itself               any  control  over  subordinate   legislation.               This  self effacement of legislative power  in               favour of another agency either in whole or in               part  is  beyond  the  permissible  limits  of               delegation.   It is for a Court to bold  on  a               fair, generous and liberal construction of  an               impugned   statute  whether  the   legislature               exceeded  such limits.  But the  said  liberal               construction  should  not be  carried  by  the               Courts  to  the  extent of  always  trying  to               discover  a  dormant  or  latent   legislative               policy to sustain an arbitrary power conferred               on  executive authorities.  It is the duty  of               the   Court   to  strike  down   without   any               hesitation  any arbitrary power  conferred  on               the executive by the legislature." It may be added that Devi Das’s(1) case did not differ  from the Liberty Cinema (2 ) case.  What was held there was  that there (1) A.I.R. [1967] S.C. 1895.       (2) [1965] 2 S.C.R. 477.  265 can  be  no general principle that merely the needs  of  the delegate can necessarily and always be a guideline.  It  was further  held that each statute has to be examined  to  find out  whether  there  are guidelines  therein  which  prevent delegation from being excessive. It  is  in the light of these general principles  which  are well-settled that the constitutionality of the delegation in S.   150  has  to  be  considered.   However,  as   we   are

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particularly concerned with the fixation of rates of a  tax, we may refer to certain cases which deal with this aspect of the  matter.  In Pandit Banarsi Das Bhanot v. The  State  of Madhya Pradesh(1), this Court observed as follows :               "Now the authorities are clear that it is  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 like." The  appellant relies on this observation to show  that  the delegation  in  s.  150  of the Act cannot  be  said  to  be excessive  as  the  rates of tax cannot be  said  to  be  an essential  feature of the law relating to taxation.  On  the other hand learned, counsel for the respondent contends that this  observation  is much too wide if it means that  it  is open  to  the legislature to delegate without  any  guidance whatsoever the power to fix the rate of tax.  In particular, it  is  urged on behalf of the respondents  that  the  cases which have been referred to in support of this conclusion in Pt.  Banarsi Das case(1) do not support the proposition laid down  there if it is to be read as giving unqualified  power to fix the rate without any guidance, control or  safeguard. With respect, it seems to us that if this observation  means that it is open to the legislature to delegate the power  to fix  the  rate,  of tax to  another  authority  without  any qualification,  guidance,  control or safeguard, it  is  too widely  stated  and does not appear to be supported  by  the authorities  on which it is based, though those  authorities do  indicate  that  in  certain cases  it  is  open  to  the legislature to give power to another authority to fix  rates under proper guidance, control and safeguard.  Take the case of Powell v. Apollo Candle Company Limited(1).  In that case S.  133 of the Customs Regulation Act of 1879 of  New  South Wales was under attack.  That section ran thus :               "Whenever any article of merchandise then  un-               known to the collector is imported, which,  in               the   opinion   of  the   collector   or   the               commissioners, is apparently a substitute  for               any known dutiable article, or is               (1) [1959] S.C.R. 427.               (2) L.R. [1885] X A.C. 282.               266               apparently   designed  to  evade   duty,   but               possesses  Properties in the whole or in  part               which  can  be  used or were  intended  to  be               applied for a similar purpose as such dutiable               article,  it shall be lawful for the  Governor               to  direct  that  a duty  be  levied  on  such               article at a rate to be fixed in proportion to               the  degree  in  which  such  unknown  article               approximates in its qualities or uses to  such               dutiable  article;  and such rate  thus  fixed               shall be published in a Treasury order in  the               Gazette, and one other newspaper published  in               Sydney,  and  exhibited in the  long  room  or               other public place in the Custom House, and  a               copy  of  all  such  Treasury  orders   shall,               without unnecessary delay, be laid before both               Houses of Parliament." A  bare perusal of the section shows that though  the  power was  delegated to the Governor to levy the duties,  it  gave complete guidance to him in the manner of fixing the rate of

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duty  and  finally  provided that the order  passed  by  the Governor  would  be laid before both  Houses  of  Parliament without  unnecessary delay.  The observations of  the  Privy Council  in that case have in our opinion to be read in  the context  of  the  words of S. 133 where  full  guidance  was provided as to the fixation of the rate. In  J.  W. Hampton v. United States(1),  the  Congress  gave power to the President to make changes in the rates provided in  the  Tariff  Act  of 1922.  That  was  challenged  as  a forbidden  delegation  of  legislative  power  to  executive authority.   But the challenge was negatived by the  Supreme Court  of the United States on the ground that the  Congress had  laid down by legislative act an intelligible  principle to  which the person authorised to fix the rate  of  customs duties on imported merchandise was to conform.  In that case the  President  could  vary the rates with the  aid  of  his advisers  after  proper  investigation  on  the  ground   of differences  of cost of production in the United States  and abroad and to make such increases and decreases in rates  of duty  as  were  found  necessary to  equalise  the  cost  of production.  The limit of such change was also fixed upto 50 per  centum  of the rates specified in the law.   This  case does  not support the proposition that rates of tax  can  be delegated  to a subordinate authority without any  guidance, though it is an authority for the proposition that this  can be   done  if  guidance  s  given  for  the  purpose.    The observation  in Banarsi Das’s case(1) the rates of  tax  are not essential features of legislation therefore seems,  with respect, to be too broadly steed, though it may be  admitted that rates of taxation also can in certain circumstances  be delegated  to a subordinate authority with  proper  guidance and subject to safeguards and limitations in that behalf. (1) 72 Law Ed. 624 : 276 U.S. 624. (2) [1959] S.C.R. 427.  267 The next case to which reference may be made is  Corporation of  Calcutta and Another v. The Liberty Cinema(1) where  the majority upheld the fixation of a tax on cinema shows,  even though  the  Calcutta Municipal Act of  1951  prescribed  no limits to which the tax could go.  In that case the majority referred to the view taken in Pandit Banarasi Das’s  case(1) and  interpreted  the dictum in that case to mean  that  the fixation  of rate can be left to a non-legislative body  but this was qualified by the observation that when the power to fix  the  rate  of  tax  was  Left  to  another  body,   the legislature  must  provide guidance for such  fixation.   In that case the majority found guidance in various  provisions of the statute to which it is not necessary to refer, though the  minority was of the opinion that there was no  guidance therein. The  question  again  arose in  Municipal  Board,  Hapur  v. Raghuvendra  Kripal(3).  There the U.P.  Municipalities  Act No.  2 of 1916, gave power to the municipality to fix  rates of tax and provided an elaborate procedure for doing so  and also provided for sanction of Government.  But one provision of  that  statute raised a conclusive presumption  that  the procedure  prescribed  had been gone through  on  a  certain notification  being  issued by Government and  the  question arose  whether  by reason of such a  conclusive  presumption there   was  not  a  delegation  of  essential   legislative function.  In that case the majority while dealing with  the question of excessive delegation observed that the taxes  in question  were local taxes for local needs for  which  local enquiries  had  to  be made and so they  were  left  to  the representatives of the local population which would bear the

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tax.  It was further observed that such taxes must vary from town  to  town,  from one Board to  another,  and  from  one commodity  to another.  Regard being had to  the  democratic set-up  of  the municipalities which need  the  proceeds  of these taxes for their own administration, (it was  observed) it  as proper to leave to these municipalities the power  to impose  and collect those taxes, which  were  pre-determined along  with  a procedure for consulting the  wishes  of  the people concerned.  Over and above that there was power given to  the  State Government to check their action.   In  those circumstances delegation as to the fixing of rate of tax  to the  Municipal Board was upheld as  permissible  delegation. The  minority judgment also accepted these propositions  and observed that though generally speaking, the rate of tax was one  of  the  essentials  of  taxing  power  given  to  the. legislature,  it  must  be recognised that  there  might  be situations  where  the  legislature  might  delegate  to   a subordinate  authority that power under  proper  safeguards. It  was also observed that in the matter of local  taxation, like  taxation  by  municipal boards,  district  boards  and bodies of that character, (1) [1965] 2 S.C.R. 477. (2) [1959] S.C.R. 427. (3)  [1966] 2 S.C.R. 950. 268 there  was pre-eminently a case for delegating the  fixation of  the rate of tax to the local body, the reason  for  this being  that  problems of different municipalities  might  be different and one municipality might require one kind of tax at  a  particular rate at a particular  time  while  another municipality might need another kind of tax at another  rate at  some  other  time.  It was further  observed  that  "the legislature  can  in the case of taxation  by  local  bodies delegate  even  the authority to fix the rate to  the  local body  provided it has taken care to specify  the  safeguards for  the purpose." The difference between the  majority  and the  minority  only was that the majority thought  that  the conclusive  presumption raised by one of the  provision  was valid  while  the  minority thought that by  reason  of  the conclusive presumption all the safeguards were wiped out  at one  stroke  and  therefore it became a  case  of  excessive delegation. The  last  case to which reference may be made is  Devi  Das Gopal  Krishnan(1).   This  was  not  a  case  of  municipal taxation.   In. this case the legislature gave power to  the State Government to fix sales tax at such rates as the State Government  thought fit.  The case of Liberty Cinema(2)  was distinguished  in this case and it was pointed out that  the needs  of  the Slate and the purposes of the Act  could  not give  sufficient guidance for the purpose of fixing rate  of sales tax by the State Government.  There is in our  opinion a clear distinction between delegation of fixing the rate of tax like sales tax to the State Government and delegation of fixing  rates  of  certain  taxes  for  purposes  of   local taxation.   The  needs of the State are  unlimited  and  the purposes for which the State exists are also unlimited.  The result  of making delegation of a tax like sales tax to  the State  Government means a power to fix the tax  without  any limit even if the needs and purposes of the State are to  be taken  into  account.  On the other hand, in the case  of  a municipality, however large may be the amount required by it for its purposes it cannot be unlimited, for the amount that a  municipality  can spend is limited by  the  purposes  for which  it is created.  A municipality cannot spend  anything for any purposes other than those specified in the Act which

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creates  it.   Therefore in the case of  a  municipal  body, however  large may be its needs, there is a limit  to  those needs in view of the provisions of the Act creating it.   In such  circumstances  there is a  clear  distinction  between delegating a power to fix rates of tax, like the sales  tax, to  the  State  Government and delegating  a  power  to  fix certain local taxes for local needs to a municipal body. A  review  of  these  authorities  therefore  leads  to  the conclusion  that  so  far as this  Court  is  concerned  the principle is well estab- (1) A.I.R. 1967 S.C. 1895. (2) [1965] 2 S.C.R. 477.  269 lished  that essential legislative function consists of  the determination of the legislative policy and its  formulation as a binding rule of conduct and cannot be delegated by  the legislature.  Nor is there any unlimited right of delegation inherent  in  the  legislative power itself.   This  is  not warranted  by  the  provisions  of  the  Constitution.   The legislature must retain in its own hands the essential B    legislative functions and what can be delegated is  the task  of subordinate legislation necessary for  implementing the purposes and objects of the Act.  Where the  legislative policy is enunciated with sufficient clearness or a standard is  laid  down,  the  courts  should  not  interfere.   What guidance  should  be given and to what  extent  and  whether guidance has been given in a particular case at all  depends on  a consideration of the provisions of the particular  Act with  which  the Court has to deal including  its  preamble. Further  it  appears to us that the nature of  the  body  to which  delegation is made is also a factor to be taken  into consideration  in  determining whether there  is  sufficient guidance in the matter of delegation. What  form the guidance should take is again a matter  which cannot be stated in general terms.  It will depend upon  the circumstances  of each statute under consideration; in  some cases  guidance  in broad general terms may  be  enough;  in other cases more detailed guidance may be necessary.  As  we are  concerned  in  the  present  case  with  the  field  of taxation, let us look at the nature of guidance necessary in this  field.   The guidance may take the form  of  providing maximum  rates of tax upto which a local body may  be  given the  discretion to make its choice, or it may take the  form of  providing for consultation with the people of the  local area and then fixing the rates after such consultation.   It may also take the form of subjecting the rate to be fixed by the local body to the approval of Government which acts.   F as  a  watch-dog on the. actions of the local body  in  this matter  on  behalf of the legislature.  There may  be  other ways, in which guidance may be provided.  But the purpose of guidance,  whatsoever may be the manner thereof, is  to  see that the local body fixes a reasonable rate of taxation  for the  local area concerned.  So long as the  legislature  has made provision to achieve that reasonable rates of  taxation are  fixed  by  local bodies, whatever  may  be  the  method employed  for this purpose- provided it is effective it  may be  said that there is guidance for the purpose of  fixation of  rates of taxation.  The reasonableness of rates  may  be ensured  by fixing a maximum beyond which the  local  bodies may  not  go.   It may be ensured  by  providing  safeguards laying  down the procedure for consulting the wishes of  the local  inhabitants.   It may consist in the  supervision  by Government of the rate of taxation by local bodies.  So long as the law has provided a method by which the local body can be controlled and there is

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270 provision to see that reasonable rates are fixed, it can  be said  that there is guidance in the matter of fix  in  rates for  local taxation.  As we have already said there is  pre- eminently a case for delegating the fixation of rates of tax to  the  local  body  and so long  as  the  legislature  has provided   a  me-hod  for  seeing  that  rates   fixed   are reasonable,  be  it in one form or another, it may  be  said that there is guidance for fixing rates of taxation and  the power assigned to the local body for fixing the rates is not uncontrolled  and uncanalised.  It is on the basis of  these principles  that we have to consider the Act with  which  we are concerned. We may, before we consider the provisions of The Act,  refer to the position prevalent in the United States of America so far  as  local  taxation  is  concerned.   Even  though  the doctrine  of separation of Dowers Drevails in that  country, it  is  recognised there that delegation of power  to  local authorities  for  fixing rates of taxes for  local  purposes does not amount to excessive delegation by the  legislature. This  conclusion  has  been reached there on  the  basis  of historical  facts.   Whenever  a  municipal  corporation  is created,  and is charged with carrying on certain  specified functions,  it  is necessary to provide it with  funds,  for otherwise  it cannot carry on the purposes for which it  has been created.  The funds may be provided as grants; but  the general pattern has always been that power of local taxation is vested in a municipal body as an essential attribute  for all  the  purposes  of its existence.  Thus  in  the  United States of America, even though the power of taxation belongs exclusively to the legislative branch of the Government,  it may   be   delegated  by  the   legislature   to   municipal corporations   :   [See  United  States  v.  City   of   New Orleans(1)]. Though  delegation  as to municipal taxation is held  to  be permissible  under the U. S. Constitution, it is so  because of  historical  reasons  peculiar  to  that  country.    The American  example may not be an apt analogy but the  history of municipal Acts in our country indicates that for nearly a century  or  more power of taxation has  been  delegated  to municipal  bodies.  In some Acts all taxes delegated to  the municipal bodies are compulsory; in other Acts all taxes  so delegated  are optional: (see U.P. Municipalities Act).   In some  cases  some taxes are compulsory and  some  taxes  are optional  as is the case in the present Act.  In some  cases maximum  limits  are  provided for some taxes  and  not  for others;  in some cases no maximum is provided, though  there are restrictions and safeguards within which the-  municipal bodies  must  act.  In all cases however, there has  been  a large area of delegation of taxing power for local  purposes to local bodies subject to control by Government or to  such other  procedural  safeguards as the  legislature  considers necessary in the matter of imposition of (1)  25 L. Ed. 225. 271 taxes.   According to our history also there is a wide  area of delegation in the matter of imposition of taxes to  local bodies  subject to controls and safeguards of various  kinds which  partake  of the nature of guidance in the  matter  of fixing  rates for local taxation.  It is in this  historical background  that we have to examine ’the provisions  of  the Act impugned before us. We  have already set out S. 150 of the Act  which  delegates power  to the Corporation to levy any of the optional  taxes at such rates as it thinks fit and further gives power to it

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to specify persons, and articles and properties on which tax will  be levied and the system of assessment to  be  adopted and  exemptions if any to be granted.  The  delegation  thus made is certainly wide and the question is whether there  is any   guidance  in  the  form  already  indicated   to   the Corporation in carrying out the duties imposed upon it under s, 150 of the Act. The  first circumstance which must be taken into account  in this  connection is that the delegation has been made to  an elected  body responsible to the people including those  who pay  taxes.  The councillors have to go for  election  every four   years.   This  means  that  if  they   have   behaved unreasonably and the inhabitants of the area so consider  it they can be thrown out at the ensuing elections.  This is in our opinion a great check on the elected councillors  acting unreasonably  and  fixing unreasonable  rates  of  taxation. This is a democratic method of bringing to book the  elected representatives who act unreasonably in such matters.  It is however urged that S. 490 of the Art provides for the super- session  of the Corporation in case if is not  competent  to perform or persistently makes default in the performance  of the duties imposed upon it by or under the Act or any  other law  or  exceeds ,or abuses its power.  In such a  case  the elected  body  may be superseded and all powers  and  duties conferred   and  imposed  upon  the  Corporation  shall   be exercised and performed by such officer or authority as  the Central Government may provide in this behalf.  It is  urged that  when  this happens the power of taxation goes  in  the hands  of some officer or authority appointed by  Government who  is not accountable to the local electorate and who  may exercise all the powers of taxation conferred on the elected Corporation  by the Act.  This however has not  happened  in the present case and we need not express any opinion on  the question   whether  such  officer  or  authority  would   be competent to increase the rates of taxes already fixed  when the Corporation is superseded or can impose new taxes  which were  not  there  at the time of supersession.   That  is  a matter which may have to be considered when such a situation arises; but so long as the power of taxation conferred by S. 150 is exercised by the elected body there will always be  a check in the form of the members thereof having to face the 272 electorate  after  every four years with  the  liability  of being thrown out if they act unreasonably.  This check which is  inherent in an elected municipal body, must  enter  into the  verdict  whether the delegation to such  a  body,  even though it is wide in extent, can be upheld on the basis that this  is a method of controlling the actions of the  elected body and setting a limit to which it can go in the matter of taxation, even though no maximum as such is provided in  the Act. Another  guide or control on the limit of taxation is to  be found in the purposes of the Act.  The Corporation has  been assigned certain obligatory functions which it must  perform and  for which it must find money by taxation.  It has  also been  assigned  certain  discretionary  functions.   If   it undertakes any of them it must find money.  Even though  the money  that has to be found may be large, it is not,  as  we have  already indicated, unlimited for it must be  only  for the  discharge of functions whether obligatory  or  optional assigned  to  the  Corporation.   The  limit  to  which  the Corporation  can tax is therefore circumscribed by the  need to  finance the functions, obligatory or optional  which  it has to or may undertake to perform.  It will be not open  to the  Corporation by the use of taxing power to collect  more

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than it needs for the functions it performs.  It cannot, for example, raise the rate of taxation to such an extent, as to provide a surplus which is much more than what it needs  for its existence in carrying out the functions assigned to  it, subject  to  its  having the minimum  cash  balance  of  Rs. 4,00,000 as provided in the Act at the end of a year.   This is  in  our  opinion  another check  which  will  guide  the Corporation  in fixing its rates of tax under s.  150  after taking into account the yield from obligatory taxes.  Though the  mere fact that specific purposes and functions are  set out  in an impugned Act may not be conclusive-it is  one  of the  factors which should be taken into account  along  with other  relevant factors.  It cannot therefore be  said  that there  is  no guidance to the Corporation in the  matter  of fixing  rates of optional taxes, though it must be  admitted that a large discretion is left to it in this behalf.   Even so  there  are  limits to which the Corporation  can  go  in fixing  these taxes and those limits like the maximum  fixed for  obligatory  taxes are the guidelines within  which  the taxing  power  of the Corporation with respect  to  optional taxes  must  be exercised.  This power is exercised  by  the Corporation  after debate by the elected representatives  of the  local area which the Corporation administers.  In  such circumstances we think that there is a limit and  guidelines provided by the Act beyond which the Corporation cannot go. Another limit and guideline is provided by the necessity  of adopting  budget estimates each year as laid down in s.  109 of  the  Act.   That section provides for  division  of  the budget of the  273 Corporation  into  four  parts  i.e.,  general,  electricity supply,  transport, water and sewage disposal.   The  budget will show the revenue and expenditure and these must balance so that the limit of taxation cannot exceed the needs of the Corporation as shown in the budget to be prepared under  the provisions  of the Act.  These four budgets are prepared  by four   Standing  Committees  of  the  Corporation  and   are presented  to the Corporation where they are  adopted  after debate  by  the elected representatives of the  local  area. Preparation  of budget estimates and their approval  by  the Corporation is therefore another limit and guideline  within which  the  power  of taxation has to  be  exercised.   Even though  the  needs may be large, we have  already  indicated that   they  cannot  be  unlimited  in  the  case   of   the Corporation, for its functions both obligatory and  optional are well defined under the Act.  Here again there is a limit to  which  the  taxing  power  of  the  Corporation  can  be exercised  in  the matter of optional taxes  as  well,  even though ,there is no maximum fixed as such in the Act. Then there is the provision in s. 150 itself which says that the  maximum  rates fixed by the Corporation at its  meeting by  a resolution have to be submitted to the Government  for its  sanction  and  without such sanction there  can  be  no imposition   of  tax.   As  we  have  already   stated   the legislature has made Government the watch-dog to control the actions of the Corporation in the matter of fixing rates and other incidents of the taxes and that is also a check to see that  reasonable rates are fixed by the Corporation when  it proceeds  to  impose  taxes under s. 150.  We  have  a  par- liamentary  system of government in which the Government  is responsible to the legislature.  That is also a circumstance which  may  be taken into account in considering  the  check imposed by the Act upon the taxing power of the Corporation, namely, that the rates fixed by it have to be sanctioned  by Government which    in   its   turn   is   responsible    to

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Parliament.   Though therefore the legislature may not  have provided that the rates of tax shall be submitted to it  for approval,  the  fact that it has provided  that  such  rates shall  be  submitted  to Government  for  approval  and  the Government in its turn is responsible to the legislature  is a factor which has to be taken into account when considering whether the    delegation by S. 150 of the Act is  excessive or  not.   It  stands to reason  that  Government  which  is responsible  to  the  legislature would act  with  care  and circumspection when exercising its function as the watch-dog on  behalf of the legislature on the taxing power  conferred by   the  legislature  on  the  Corporation.   Under   these circumstances we do not think that it can be said that there are  no guidelines, limits, controls or safeguards  provided by  the  legislature in the matter of the  exercise  of  the power   of  taxation  under  s.  150  of  the  Act  by   the Corporation.  The legislature cannot in the circumstances be said to have abdicated its power for 274 it has indicated the taxes which the Corporation can impose. The Corporation cannot go beyond the taxes the imposition of which  has been entrusted to it by the legislature.  In  the case  of  obligatory  taxes,  the  legislature  itself   has provided  the  maximum  in some cases  or  the  fixation  of reasonable rates in other cases like water, tax,  scavenging tax  or fire tax.  In the case of optional  taxes,  however, greater freedom has been left to the Corporation to  arrange its  budgets and fix rates of taxation; but this freedom  is circumscribed  and guided and controlled under  the  various provisions of the Act which we have already referred to  and which  must  be  taken  to limit the  taxing  power  of  the Corporation  even though no specific maximum has been  fixed in  the  Act for optional taxes.  It seems to  us  therefore that  considering  that  the power is  en.  trusted  to  the elected representatives of the local area who are liable  to go  for  election before the local  electorate  every  four. years,  the nature of guide given by the Act  is  sufficient for  the purpose of kepping the Corporation  within  limits. In such circumstances, considering the constitution and  set up  of  the municipal corporation, its need for  finance  to carry  out  the  functions entrusted  to  it,  its  elective character,  its  responsibility to the electors,  the  safe- guards  and  controls provided in the  Act,  procedural  and otherwise,  it is difficult to hold that the power of  taxa- tion  conferred  on it is either uncanalised,  arbitrary  or without guidance or policy. Finally  there  is  another  check  on  the  power  of   the Corporation  which is inherent in the matter of exercise  of power  by subordinate public representative bodies, such  as municipal boards. In such cases if the act of such a body in the  exercise  of the power conferred on it by  the  law  is unreasonable, the courts can hold that such exercise is void for  unreasonableness. This principle was laid down  as  far back  as  1898 in Kruse v. Johnson(1) in connection  with  a bye-law  made  by a count council. In that case  the  county council  made  a  certain  bye-law  and  its  validity   was challenged on the ground that it was unreasonable. The Court heldthat  a bye-law could be struck down on the  ground  of unreasonableness  but  took  pains  to  point  out  that  in determining  the  validity  of a bye-law made  by  a  public representative  body,  such as a county council,  the  court ought to be slow to hold that the byelaw  was  void   for unreasonableness. The Court further held that"  a  bye- law  so  made  out  ought  to  be  supported  unless  it  is manifestly  partial  and unequal in  its  operation  between

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different  classes,  or  unjust, or made in  bad  faith,  or clearly  involving  an unjustifiable interference  with  the liberty of those subject to it." The same principle would apply to the fixation of rates of taxation and if per chance the Corporation fixes rates which are unreasonable, there (1)  [1898] 2 Q.B.D. 91.  275 is control in the court to strike down such an  unreasonable impost. On   a  careful  consideration  therefore  of  the   various provisions of the Act, we must hold that the power conferred by  s. 150 of the Act on the Corporation is not unguided  in the circumstances and cannot be said to amount to  excessive delegation. This brings us to two minor points raised before us.  It  is urged  that  the  tax  was  imposed  on  the  production  of electricity  and not on consumption as required by  the  Act and as provided in item 53, List II of the Seventh  Schedule to the Constitution.  We cannot accept this contention.  The resolution which was, passed on February 9, 1959, shows that the  tax  was  imposed  inter alia  on  the  consumption  of electricity   by  a  person  generating  it  for   his   own consumption.  The words used in the resolution are  somewhat inapt but the meaning in our opinion is quite clear,  namely that a tax at the rate of 5 n.p. per KWHR is imposed on  the constitution  of electricity on a person generating  it  for his own consumption.  The tax is thus on the consumption  of electricity  where it is generated by a person for  his  own consumption and not on the production of electricity. Then it is urged that the sanction by Government was not  in accordance with the provisions of the Constitution and  that in this case the sanction was given by the Deputy  Secretary to  Government who obviously had no authority to do so.   We are  of opinion that there is no force in  this  contention. The  order  conveying sanction specifically says  that  "the Central Government hereby sanctions the resolution passed by the Municipal Corporation of Delhi under sub-section (1)  of section  150."  It is true that the order is signed  by  the Deputy  Secretary but that does not mean F that it  was  the Deputy Secretary who sanctioned the rates.  It is also  true that  the words "by the order of the Central Government"  or "by  the  order of the President" are not  there  above  the signature  of  the Deputy Secretary and  the  authentication therefore  is no quite in accordance with the provisions  of Art.  77 of the Constitution, but that deficiency  has  been made  up  by the affidavit filed on behalf  of  the  Central Government  in  which it is stated that the  resolution  was approved  by the then Deputy Home Minister and the  Minister in the Ministry of Home Affairs to whom the work relation to the Corporation was assigned by the Home Minister.  Reliance in  this  connection was placed on the Government  of  India (Allocation  of Business) Rules, 1961, passed    on  January 14,  1961  to the effect that "in relation to  the  business allotted to a Minister, another Minister or Deputy  Minister may  be  associated  to perform such  functions  as  may  be assigned  to him." That in our opinion clearly means that  a Cabinet Minister may 276 be assisted in the performance of functions allotted to  him by another Minister or Deputy Minister.  It is not necessary where, business has been assigned by a Cabinet Minister to a Minister or a Deputy Minister that the matter should be  put before  the Cabinet Minister also after the Minister or  the Deputy  Minister has approved of it in accordance  with  the assignment  made  in his favour.  We are  therefore  of  the

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opinion  that  the sanction has been given  by  the  Central Government as required by the Act. That takes us to the question of validation.  The Validation Act  was passed in December 1966 and section 2 thereof  with which we are concerned reads thus:-               "(1)  Notwithstanding  anything  contained  in               section  150  read  with  sub-section  (2)  of               section 109 of the Delhi Municipal Corporation               Act,   1957,  the  resolution  of  the   Delhi               Municipal  Corporation  dated the  24th  June,               1959, passed under sub-section (3) of  section               150 aforesaid, insofar as the said  resolution               relates  to the determination of the rates  at               which tax shall be leviable on the consumption               or sale of electricity shall be deemed to have               been  passed  in accordance with law  and  The               rates  specified  in the  said  resolution  in               respect  of tax on the consumption or sale  of               electricity shall be deemed to be, and to have               been,  the actual rates of the tax  under  the               said  Act with effect on and from 1st  day  of               July 1959 and up to and inclusive of the  31st               day of March, 1966.               (2)   Notwithstanding  anything  contained  in               any judgment, decree or order of any court  to               the contrary, all taxes on the consumption  or               sale  of  electricity levied or  collected  or               purporting  to have been "levied or  collected               in pursuance of the resolution referred to  in               sub- F section (1) shall, for all purposes, be               deemed to be, and to have always been, validly               levied or collected. " The argument which found favour with the High Court was that the words of S. 2 only validated the levy and collection  of tax  for  the  year ending March 31, 1960  and  no  further, though the G section in terms refers to the period from July 1,  1959  to  March 31, 1966.   The  contention,  which  was accepted by the High Court, was that though fixation of rate of  tax was validated up to March 31, 1966, the levy of  the tax  was not validated for the whole period by S. 2  of  the Validation  Act.  The same argument was raised before us  in support of the contention that the Validation Act failed  in its purpose so far as the period from April 1, 1960 to March 31,  1966  is concerned.  We are of opinion  that  the  High Court was in error in holding that the levy and collec- 277 tion was not validated for the period from April 1, 1960  to March 31, 1966 and that the Validation Act merely  validated the  fixation of rate of tax for that period.  Section  2(1) which  is  said to have failed in validating  the  levy  and collection of tax for the period from April 1, 1960 to March 31,  1966 is in two parts.  In the first place it  validates the  resolution  of the Corporation dated June 24,  1959  by which  rates were fixed under s. 150(3) for the year  ending March 31, 1960.  As the High Court says-and rightly so  this means  that  everything that went before the  resolution  of June  24,  1959 was passed was validated.  It  was  on  this ground  that  the High Court held that  ’he  Validation  Act validated the levy and collect-on of tax at the rates  fixed for the period from July 1, 1959 to  March  31, 1960.   The High Court seems to have over-looked the  second part of s. 2(1) which lays down that the rates specified  in the  resolution  of June 24, 1959 in respect of tax  on  the consumption or sale of electricity under the Act with effect on  and  from  the  1st day of July,  1959  and  up  to  and

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inclusive of the 31st day of March, 1966 shall be deemed  to be, and to have been, the actual rates of the tax.  By  this part  of s. 2(1), Parliament has clearly approved the  rates deducible from the resolution of June 24, 1959 as the actual rates  of  tax for the entire period from July  1,  1959  to March 31, 1966.  This could only be to validate the levy and collection  of  tax  at  that  rate  for  that  period,  for otherwise we can see no sense in the Validation Act.  It  is however  said that the words "at which tax shall  be  levied and  collected"  do not appear after the words  "the  actual rates of the tax" in s. 2(1) and therefore the section  must be  taken to have validated the rates only.  It has  neither provided  for levy and collection of tax nor  validated  its levy  and collection for the period mentioned  therein.   It seems  to  us  that when s. 2(1) lays down  that  the  rates deducible from the resolution of June 24, 1959 shall be  the actual rates of tax for the entire period from July 1,  1959 to  March  31, 1966, it must be understood to  sanction  the levy and collection of tax at the rates fixed.  This to  our mind  is  implicit in the word "actual"  which  governs  the words "rates of the tax".  We may add that even if there was some  doubt in the matter from the words of s. 2  (1),  that doubt  is resolved by the words of s. 2(2), which lays  down that  "all taxes on the consumption or sale  of  electricity levied  or  collected or purporting to have been  levied  or collected in pursuance of the resolution referred to in sub- section (1) shall, for all purposes, be deemed to be and  to have always been validly levied or collected." This  clearly shows that the validation was not merely of the rate of  tax but  of levy and collection also for the entire period  from July  1, 1959 to March 31, 1966.  We cannot therefore  agree with  the  High  Court  that only  the  rates  of  tax  were validated and not levy and collection thereof for the 278 period  from April 1, 1960 to March 31, 1966 We may go  fur- ther and say that as we read S. 2(1) and s. 2(2) together it seems to us that Parliament not only validated what was done but  also  itself  imposed  the  rates  deducible  from  the resolution  of  June 24, 1959 and authorised  the  levy  and collection  thereof for the entire period from July 1,  1959 to March 31, 1966 notwithstanding anything contained in  any judgment, decree or order of any court to the contrary. We  therefore allow the appeals, set aside the order of  the High  Court  insofar  as it is  against  the  appellant  and dismiss   the  writ  petitions.   No  order  as   to   costs throughout. Hidayatullah, J.-The Delhi Municipal Corporation in exercise of powers under its constituent Act has levied a tax on  the consumption,  sale or supply of electricity.  This power  is expressly conferred by the Delhi Municipal Corporation  Act, 1957 (66 of 1957).  Section 113(2)(d) and (3) reads :               "(2)  In addition to taxes specified  in  sub-               section  (1)  the  corporation  may,  for  the               purposes   of  this  Act,  levy  any  of   the               following taxes, namely:               (d)   a tax on the consumption, sale or supply               of electricity.               (3)   The  taxes specified in sub-section  (2)               shall  be  levied, assessed and  collected  in               accordance with the provisions of this Act and               the bye-laws made thereunder".               The Act provides further in S. 150:               "150.  Imposition of other taxes.               (1)   The Corporation may, at a meeting,  pass               a resolution for the levy of any of the  taxes

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             specified  in sub-section (2) of section  113,               defining  the  maximum rate of the tax  to  be               levied, the class or classes of persons or the               description  or descriptions of  articles  and               properties   to  be  taxed,  the   system   of               assessment  to be adopted and the  exemptions,               if any, to be granted.               (2)   Any resolution passed under  sub-section               (1)   shall  be  submitted  to   the   Central               Government for its sanction, and if sanctioned               by  that Government, shall come into force  on               and from such date as may be specified in  the               order of sanction.               (3)   After  a resolution has come into  force               under  sub-section (2), the  Corporation  may,               subject to the               279               maximum   rate,  pass  a   second   resolution               determining the actual rates at which the  tax               shall be leviable, and the tax shall come into               force  on the first day of the quarter of  the               year  next  following the date on  which  such               second resolution is passed.               (4)   After   a   lax  has  been   levied   in               accordance  with the foregoing  provisions  of               this  section, the provisions  of  sub-section               (2) of section 109, shall apply in relation to               such tax as they apply in relation to any  tax               imposed under sub-section (1) of section 113". On  February  9,  1959 the Municipal  Corporation  passed  a resolution  stating  the  rate at which  the  tax  would  be levied.   The  resolution  was  submitted  to  the   Central Government   for  its  approval.   The  Central   Government modified  the  rate by enhancing it. On June  23,  1959  the Standing  Committee of the Corporation recommended the  rate sanctioned  by  the  Government as the  actual  rate  to  be imposed.   The  Corporation then resolved on June  24,  1959 that the tax was imposed at that rate. The  respondent  challenged the imposition of the tax  by  a Writ  petition in the Punjab High Court.  A  learned  single Judge dismissed the petition but on appeal in the High Court the  decision  was reversed.  It was held that  the  Central Government  lacked power to alter the rate.  On December  3, 1966,  Parliament  passed the  Delhi  Municipal  Corporation (Validation of Electricity Tax) Act, purporting to  validate the  rate  of  tax.  On February  17,  1965,  the  Municipal Corporation  passed  another  resolution  under  S.   150(1) stating  the  maximum  rate of  tax.   This  resolution  was approved  by  Government and a second  resolution  was  then adopted  under  s.  150(3) naming the maximum  rate  as  the actual  rate.   This  was on December 27,  1965.   Two  writ petitions were filed by the respondent in the High Court  of Delhi.   The first questioned the imposition of the  tax  by the resolutions of February 17 and December 27, 1965 and the second questioned the legality of the Validation Act.  These petitions succeeded and the present appeals followed. The  learned  Chief Justice in his judgment has  upheld  the validity of "lie Validation Act.  As we are of opinion  that the earlier resolutions were also legal, we need say nothing about  the  Validation  Act.  We agree,  however,  that  the Validation  Act  cannot be questioned.   The  learned  Chief Justice has Adequately answered the objections and  although we  might have stated our reasons separately we do not  find it  necessary to do so.  We agree that the  relevant  appeal must be allowed.

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On  the  other point we agree with the  conclusions  of  the learned  Chief  Justice that the other appeal must  also  be allowed. L6Sup.C. I /68-5 280 In our opinion, the Delhi Municipal Corporation was  legally invested with the power to levy the electricity tax.  We are satisfied that there is no flaw in the conferral of power on the  Municipal Corporation by s. 113 and 150 of the Act  and the  resolutions passed thereunder.  The objection  in  this connection  is that the parliamentary Act itself is  invalid inasmuch  as  it  amounts  to  an  excessive  delegation  of essential legislative functions by Parliament to an  outside body.   The  learned  Chief Justice has  upheld  S.  150  by pointing  out certain in built safeguards in the Act  which, in his view, save it from being characterised as a piece  of excessive  delegation.  With all due respects we think  this is not the only approach to the problem.  We do not wish  to be  understood  as saying that the conferral of a  power  of taxation  on Municipalities must always be accompanied by  a detailed  enumeration in the constituent Act of the rate  of the tax, the persons to be taxed, the manner of the levy and collection, before it can be said that there are  sufficient safeguards.   Nor do we think that these matters  cannot  be left  to  the  determination of  the  Municipal  Corporation subject, of course. to such controls as the legislature  may think  necessary  to  effectuate its own  will.   While  the provisions  which  have  been  characterised  as  safeguards (where  found  necessary) are desirable the proper  test  to apply  is  not the existence of safeguards but  whether  the legislative  will to impose the tax is adequately  expressed so as to bind those who have to pay the tax.  This  requires an examination of the policy and provisions of the Act  with a view to determining whether the legislative will is  fully expressed  to invest the Municipal Committee with the  power to  levy the tax subject, of course, to a  proper  procedure being  evolved.   We shall briefly  indicate  reasons  which compel us to give our opinion separately. The charge here is that the power to impose the tax  granted by  ss.  113 and 150 amounts to an excessive  delegation  of essential legislative functions without adequate control  or guidance  of Parliament and, therefore, the grant is  beyond the  competence  of Parliament.  This contention  is  raised because of the gloss put upon the Delhi Laws Act(1) case  in some  subsequent cases which seem to carry the  observations in that case to fields which, perhaps, were not in the minds of  the  Judges  who gave the Advisory  opinion.   In  those fields  other considerations apply which unfortunately  have been  overlooked more particularly when the question  is  of investing a Municipal Corporation with the authority to levy taxes. The  Delhi  Laws  Act(1) case  was  concerned  with  certain legislation which conferred a general power on the Executive Government  to apply any Act in force in British  India,  to certain (1)  [1951] S.C.R. 747.  281 areas  with  such  modifications,  amendments,  restrictions (involving repeal of laws already in force) as the Executive Government  might  consider  expedient  or  necessary.   The Executive Government was not contained in its discretion  by any  direction on the subject.  This made it free to  choose any  law and to modify it as it thought fit before  applying it  and incidentally to repeal such laws as were already  in force in those areas.  The general observations in the  case

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were that the proposed measures there considered in  several respects amounted to the effacing of the legislature and the setting  up of a parallel legislature.  The issue  obviously was  a  narrow  and  a special  one.   It  concerned  direct legislation in an area by imposition of laws at the hands of the Executive.  The legislature gave too free a hand to  the Executive.  The Advisory opinion ought, therefore to be read secumdam  subjectam  materiam and need not  be  extended  to those  cases  in which the legislature outlines  the  entire policy  of  the  municipal administration  and  keeping  the control in its own hands authorises the Municipal  Committee to levy taxes which it itself determines and sanctions.  How deeply  must  the policy of a law be  searched,  of  course, depends  upon  the kind of the law and  its  purpose.   This obvious point has got lost in the application of this  Delhi Laws Act(1) case, particularly in Devidas Gopal Krishnan  v. State of Punjab(1) where it received an extension to  fields to  which the observations could not logically  extend.   In other  cases  many  points  were evolved  to  get  over  the difficulties  of accepting those  observations  simpliciter. The   observations   were,   of   course,   not    statutory prescriptions.   The  result  is that  the  courts  seem  to struggle  to discover what have been variously described  as the  policy  of the law, the guidance, the  safeguards,  the limits, the standards and the restrictions.  These  attempts merely show that what is intended to be found out is whether the  legislature has expressed its own will  in  unequivocal terms so as to make the law a binding rule of conduct.   The several expressions here enumerated do not, of course,  mean the same thing.  Nor can it be said that an aggregate of all of  them  must  clearly, appear from  the  impugned  statute because if they do there will be no need for the agent.  The agent is then only an executing authority and not acting  in aid of the legislature which is the underlying principle  on which  delegated  legislation  is  upheld.   The  result  as noticeable  from case to case has been somewhat strange.   A search has been made in the various Acts from the policy  of law  as stated in the preamble to the operative parts,  from the positive directive enactments to what may be  considered as  mere  policy statement to sustain the  law.   No  search appears  to have been made from the standpoint  whether  the legislature has or has not expressed its (1) [1951] S.C.R. 747. (2) A.I.R. 1967 S.C. 1895. 282 own  will completely leaving the application of the  law  to those  circumstances which the legislature has already  pre- determined. The  learned Chief Justice resolves the present  controversy by highlighting the provisions which indicate that there are "safeguards",  "guidelines"  and "limits" in  the  Municipal Corporation  Act.   In reaching his conclusion  the  learned Chief   Justice  emphasises  that  there   are   ’safeguards sufficient’  to enable the Municipal Corporation to  validly impose  the tax.  If any such " safeguards" (as to which  we do  not  consider it necessary to express an  opinion  here) were  necessary,  it  is sufficient to point  out  that  the scheme  of the Municipal Act as a whole, the  functions  the Municipality  is expected to perform, the resources it  must have,  the gradation of compulsory taxes, their limits,  the control of Government and various other provisions,  furnish a sufficient answer.  They are safeguards enough to  sustain the Act. But,  in our opinion, this matter goes further.   Whether  a legislature can confer on a Municipal Corporation a power to

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levy  a tax and how, is a very different question from  that which  was  resolved  in the Delhi  Laws  Act(1)  case.   It involves a consideration of what our Constitution enables to be done under the relevant legislative entry and the  nature of the Municipal administration.  It must be resolved on the basis  of  sovereignty  which the  legislative  entries  are intended to confer. The entry in question is Entry No. 5 in the State List.   It reads :-               "5.  Local  government, that is  to  say,  the               constitution    and   powers   of    municipal               corporations,  improvement  trusts,   district               boards,  mining  settlement  authorities   and               other  local  authorities for the  purpose  of               local      self-government     or      village               administration." Under this entry power is given to the legislature to create self governing units.  It has always been understood, as  we shall  show presently, that such self-governing  units  must have  resources  for their own  administration  and  duties. There  are  only  two methods by which  money  can  be  made available: one is to give them a grant; and the other is  to allow  them  to raise funds by fees and taxes.   The  second method  is generally followed and the legislaiures in  India on  times  out  of number have invested  these  local  self- governing   units   with  powers  of  taxation.    No   such legislation  has  been  questioned on  the  ground  that  it offends  against the competency of the legislature.   It  is now contended that such exercise of power by the legislature offends  against  the doctrine of separation of  powers  and also is hit by the maxim delegatus non-potest delegare.   We shall now discuss these two questions. (1)  [1951] S.C.R. 747.  283 Our Constitution no doubt divides the functions of the State between three organs of the Government but it does not  make a clean-cut division of the functions of these three  organs as   do   some  other  Constitutions.   For   example,   the Constitution of Massachusetts carries the provision-               "the   legislative  departments  shall   never               exercise the executive and judicial powers, or               either  of  them; the  executive  shall  never               exercise the legislative and judicial  powers,               or  either of them; the judicial  shall  never               exercise the legislative and executive powers,               or either of them." Even  the  Constitution of the United States  in  Article  I section (1) provides :               "Section  1.  AR  legislative  powers   herein               granted  shall be vested in a Congress of  the               United States, which shall consist of a Senate               and House of Representative." The Australian Constitution also makes a much more rigid cut between the three organs.  By reason of such provisions  the theory of separation of powers advanced by Montesquieu  (who regarded the separation of powers as the best feature of the British Constitution) has played a great part.  Montesquieu, of course, was not quite right in imagining that there was a complete separation of powers in England.  The other theory, which has played a part flows from the maxim already quoted. In the Bonus case of Jalan Trading Co. Private Ltd. v.  Mill Mazdoor Union(1) we had the occasion to say that that theory was  wrongly  understood.  We may recall here what  we  then said               "This  doctrine, it has been accepted  on  all

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             hands was originated by the glossators and got               introduced into English Law by a misreading of               Bracton  as  a  doctrine  of  agency  and  was               applied  by Coke in decisions to  prevent  the               exercise  of judicial power by another  agency               and  later  received its present form  in  the               United States." This  theory has been discountenanced even in America  where in spite of a somewhat rigid separation of powers  delegated legislation  is permitted in various fields.  No  doubt  the Donoughmore Committee in England recommended that delegation should be put within bounds.  But the example of the  United States is to the contrary.  The question was examined by the Moreland Commission, the Brownlow Committee and the  Acheson Committee.   They  permitted  the  delegation  of  ancillary powers  to instrumentalities other than  the  legislatures.- The  Donoughmore Committee had before it the opinion of  the First Parliamentary Counsel in these words : (1)  [1967] 1 S.C.R. 15 at 59. 284 .lm15 ". . . it would be impossible to produce the amount and  the kind  of  legislation which Parliament desires to  pass  and which the people of this country are supposed to want, if it became  necessary  to  insert  in  the  Acts  of  Parliament themselves  any considerable portion of what is now left  to delegated legislation." Therefore, in England and America many writers (for example, Lowell)  have  pointed  out  that  previously  English   and American statutes were over-burdened with details and  tried to  provide  in advance for all matters.   Things  have  now changed.  Delegated legislation is now held "inevitable" and the criticism of it is only because of ’nostalgic  yearnings for  an era that had passed’.  The result is  noticeable  in England,  America,  Australia, Canada and  in  our  country. Take  any statute and it will be found that quite a  lot  of things  are left to be done by some  other  instrumentality. The  rule  making power, ’the appointed  day’  clauses,  the provisions  for extending the Act, for  granting  exemptions and  so  on  and so forth are to  be  met  with  everywhere. Otherwise, how can one justify the controls which have  come into existence in India ? The Gold Control Order sprang from the  Defence of India Act without there being any  statement in  the  Defence  of  India  Act  of  any  "guidelines"   or "safeguards".   The  Essential Supplies  (Temporary  Powers) Act,  1946  was sustained by reading  the  preamble  without making  a search for "guidelines", "limits" or  "safeguard"- see Harishankar Bagla v. The State of Madhya Pradesh(1).  In Rai  Narain  Singh  v.  The  Chairman  Patna  Administration Committee  (2),  the power to modify existing  statutes  was recognised  provided no essential feature was  changed.   In Western India Theatres Ltd. v. Municipal Corpn. of the  City of  Poona(3), a general provision that the Municipality  may impose  " any other tax" to the nature and object  of  which the  approval  of the Governor-in-Council was  obtained  was held  valid  only  because  the tax  was  imposed  "for  the purposes of the Municipality." In Hamdard Dawakhana(4)  case the  selection  of diseases or conditions was  left  to  the Executive  but was held not to be an instance  of  excessive delegation.   In  Pandit Banarsidas Bhanot v. The  State  of Madhya Pradesh(5), it was observed :               "Now the authorities are clear that it is  not               unconstitutional for the legislature to  leave               it  to  the  executive  to  determine  details               relating to the working of taxation laws, such

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             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 like." (1)  [1955] 1 S.C.R. 380. (2)  [1955] 1 S.C.R. 293. (3)  [1959] 2 Supp.  S.C.R. 71. (4)  [1960] 2 S.C.R. 671. (5) [1959] S.C.R. 427.  285 This  was  justified on the ground that in  doing  this  the legislature could not be considered to have lost its perfect control  since  it retained the power to interpose  its  own authority.   The principle was accepted on the basis of  the decision  of  the  Judicial Committee in  Powell  v.  Apollo Candle Co. Ltd.(1). The learned Chief Justice has  expressed that the case was wrongly read but with all due respects  it has always been understood in this sense.  Lastly in Liberty Cinema  (  2 ) case the rate of a tax was not  considered  a part of the essential legislative function. These  cases  in themselves cover the present  matter.   The principle  now  advocated that the legislature  must  itself impose  the tax by laying down the rate, the persons  to  be affected  and  the  manner of levy and  collection  when  it concedes  power  to Municipal Corporation appears  to  be  a novel doctrine which has not been accepted even in the  land where  the  doctrine about delegated  legislation  took  its birth.   It is not necessary to clog this judgment  by  many citations but an extract from United States v.   City of New Orleans(1) may usefully be cited :               "The  position  that  the  power  of  taxation               belongs exelusively to the legislative  branch               of  the  government, no one  will  controvert.               Under  our system it is lodged  nowhere  else.               But it is a power that may be delegated by the               Legislature  to municipal corporations,  which               are merely instrumentalities of the State  for               the  ’Better administration of the  government               in  matters  of local concern.   When  such  a               corporation is created, the power of  taxation               is vested in it as an essential attribute, for               all the purposes of its existence, unless  its               exercise be in express terms prohibited.   For               the  accomplishment  of  those  purposes,  its               authorities, however limited the  corporation,               must have the power to raise money and control               its  expenditure.   In a city, even  of  small               extent,   they  have  to  provide   for   ’the               preservation of peace, good order and  health,               and the execution of Such measures as  conduce               to  the general good of its citizens; such  as               the  opening  and repairing  of  streets;  the               construction of sidewalks, sewers and  drains;               the    introduction   of   water,   and    the               establishment of a fire and police department.               In  a  city like New Orleans,  situated  on  a               navigable streami, or on a harbor of a lake or               sea, their powers are usually enlarged, so  as               to embrace the building, of wharves and  docks               or  levees  for the benefit of  commerce,  and               they  may extend also to the  construction  of               roads  leading to it, or the  contributing  of               aid               (1)   [1885] 10 A.C. 282.               (2) [1952] 2 S.C.R. 477.

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             (3) 25 L. Ed. 225 at 226.               286               towards  their construction.  The  number  and               variety  of  works which  may  be  authorized,               having a general regard to the welfare of  the               city  or  its  people,  are  mere  matters  of               legislative  discretion.  All of them  require               for  their execution considerable  expenditure               of   money.    Their   authorization   without               providing the means for such expenditure would               be  an  idle  and  futile  proceeding.   Their               authorization, therefore, implies and  carries               with it the power to adopt the ordinary ’means               employed  by  such bodies to raise  funds  for               their   execution,  unless  such   funds   are               otherwise provided.  And the ordinary means in               such cases is taxation.  A municipality  with-               out  the  power of taxation would  be  a  body               without life, incapable of acting, and serving               no useful purpose." It  is argued that in America this is held to  fall  outside excessive delegation because of the history of the municipal corporations  in  that  country.   There  is  no   essential difference  between  the  United States and  India  in  this respect.   Municipal Corporations have a hoary past  in  our country  also.  The first Municipal Corporation was  created in  India  by a Royal Charter in 1687 at  Madras.   In  1726 three Charters established Municipal Corporations at  Bombay Calcutta  and  Madras.  Since then scores of  statutes  have established municipalities all over India.  The  Conservancy Act   X   of  1842,  which  applied   to   Bengal,   allowed municipalities  to  tax  houses.  The Act  remained  a  dead letter.   But  in 1882 Lord Rippon’s Government  passed  the well-known  Resolution  extending Local  Self-Government  in India  and the municipalities have since been accepted as  a limb of local self-government.  Every Municipal Act (whether for  a single municipality or for a group)  contains  almost identical  provisions regarding taxation.  It is one of  the attributes  of  the  local  self-government.   The   various Constitutions  which have governed us have  always  included the power to set up local self-government and provided  that it  must  be  financed and must have the  power  of  raising funds.  Therefore the constituent Acts have almost in  every instance provided for raising of funds through taxes in  the local  areas  subject to control of Government.   Today  the entry in the Constitution also recognises this power in  the legislature.   The provisions about taxes have followed  the same  method  as  in the Delhi  Municipal  Corporation  Act. Sometimes  the  provision  enables  public  opinion  to   be elicited  before  the  tax is imposed but  this  is  not  an invariable  rule.   The exercise of the power has  not  been questioned as it has been in recent years. We  are  concerned here with Parliament which by  a  concen- tration  of all the powers of legislation derived  from  all the  three Legislative Lists becomes the most competent  and potent legisla-  287 ture  it is possible to erect under our  Constitution.   The doctrine that it is a delegate of the people which  coloured certain American decisions does not arise here.  It has been discarded  also  in America.  The old plea that  the  Indian legislatures  were delegates of the British  Parliament  and therefore could not delegate further, (rejected in a  string of cases by the Judicial Committee), is not open today.  The doctrine   that  Parliament  cannot  delegate  its   powers,

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therefore,  must  be understood in a limited way.   It  only means  that the legislature must not efface itself but  must give  the legislative sanction to the imposition of the  tax and  must  keep the control in its own hands.  There  is  no specific  provision in the Constitution which says that  the Parliament    cannot   delegate   to    certain    specified instrumentalities the power to effectuate its own will.  The question  always  is whether the legislative will  has  been exercised  or not.  Once it is established that  the  legis- lature itself has willed that a particular thing be done and has   merely   left  the  execution  of  it  to   a   chosen instrumentality  (provided that it has not parted  with  its control)  there can be no question of excessive  delegation. If  the  delegate  acts  contrary  to  the  wishes  of   the legislature  the legislature can undo what the delegate  has done.   Even the courts, as we shall show presently, may  be asked to intervene when the delegate exceeds its powers  and functions.  The observations and theories culled from Ameri- can   cases  cannot  be  applied  in  our  country   without reflection.   Even in America the doctrine is  much  watered down   especially  when  it  is  a  question  of   investing municipalities  with  power-of such  taxation.   Parliament, when  it confers such powers, cannot be said to abdicate  or efface  itself  unless it can be said that it has  lost  its control  over  the action of the delegate.  In  the  present case, in addition to prescribing the mode, it keeps a  check by making Government, answerable to itself, the  supervising authority.   This is not a safeguard in the sense  in  which the  matter has been accepted in the opinion of the  learned Chief Justice, but is indicative   of  the exercise  of  the legislative Will by the legislature itself.  The details  of the tax are to be considered by the supervising   authority and  if the tax is not what the legislature intended  should be imposed, the tax cannot be imposed. It is no use comparing compulsory taxes with optional  taxes in  the Municipal Corporation Act.  Even in  the  compulsory taxes  rsee for example s. 114(1) (a) (b) (c)  much of  what may,  otherwise,  be described as essential is left  to  the determination of the Municipal Corporation.  The  percentage in  each  case  is  not  named and  has  been  left  to  the determination  of the Municipal Corporation.   No  standards are prescribed nor are there any restrictions to ensure that the percentage will-not be unduly high.  No doubt in some of the taxes limits are fixed but even below the maximum 288 limit  or  between the maxima and minima there  is  still  a broad  discretion in the Municipal Corporation.   In  making bye-laws  there  is  no direction,  guidance  or  safeguards except the approval of the Government.  If section 150 is to be  questioned the other sections must equally be  bad.   If the  Corporation  cannot  be ,trusted to  do  this  and  the vesting  of the power in it is illegal it must be so in  the other cases.  The respondents, however, do not criticise the compulsory  taxes as bad.  There is nothing to show in  what order  the  optional  taxes are to be  chosen  and  imposed. Further, there is no indication of the proportion which  the compulsory taxes must bear between themselves.  There is  no difference in principle between what is intended to be  done by s. 150 and that which is to be done by s. 114 and several other sections.  In fact, s. 150 is mild when compared  with some  ,of  the  other sections.  We  cannot  agree,  to  the proposition  which has been urged before us that s.  150  is excessive   delegation   when   these   sections   are   not characterised as excessive, delegation. Local bodies are subordinate branches of governmental  acti-

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vity.   They  are  democratic institutions  managed  by  the representatives  of  the people.  They function  for  public purposes  and take away a part of the government affairs  in local areas.  They are political sub-divisions and  agencies which  exercise  a  part 6f State functions.   As  they  are intended  to  carry on local self,government  the  power  of taxation is a necessary adjunct to their Other powers.  They function under the supervision of the Government.      This supervision  is  considered  necessary,  because   Municipal Councillors  as  a  rule are unwilling to tax  in  a  manner likely to affect themselves.  House-holders seek to transfer burdens  to  tradesmen and vice-versa.  To insist  that  the legislature .Should provide for every matter connected  with municipal  taxation  would  make  municipalities  mere   tax collecting departments of Government and not  self-governing bodies  which they are intended to be.  Government might  as well  collect  the  taxes and make  them  available  to  the municipalities.   That  is  not a  correct  reading  of  the history  of Municipal Corporations and  other  selfgoverning institutions in our country. The tax has not been challenged as unreasonable.  If it  had been  it  might  have been necessary  to  consider  it  from another angle.  The delegation to the Municipal  Corporation of  the power to levy taxes and fees is for the  purpose  of its own duties under the Act.  The power must be  reasonably exercised for attainment of those purposes.  These  purposes include  supply  of water, running  of  transport  services, lighting  of  streets and  their  maintenance,  conservancy, establishment of hospitals and so on.  The interrelation  of taxes with expenditure has to be maintained.  This  relation must be reasonable.  Suppose it were  289 to  become unreasonable.  Is there no remedy ? Now the  rule regarding reasonableness of bye laws was laid down in  Kruse v. Johnson(1).  This rule has been universally accepted  and applied in India and elsewhere. The  same rule is applied to fees and taxes imposed  by  the Municipal  bodies.  Since illustrative cases were not  cited at  the Bar it is not necessary to give a full list.  A  few representative  cases, selected by us at random may be  seen in Mewa Ram v. Municipal Board, Mathura (2)  Corporation  of Madras  v.  Spencer  & Co. Ltd ( 3 )   V.  M.  Raghavalu  v. Corporation  of Madras(4), Municipal Corporation of  Rangoon v.  Sooratee  Bara Bazar Col.  Ltd.(5),  Municipal  Council, Kumbakonam v. Balli Bros.(6). Nor is the reasonableness of a tax  open to question in relation to  municipalities  alone. It  was even considered in relation to legislatures  by  the Judicial  Committee  in  Attorney  General  of  Alberta   v. Attorney  General of Canada(7).  An unreasonable tax can  be considered by the courts but it must be a clearly exorbitant tax which goes so high as to be extortionate. We  do  not agree that our view will make it  easy  for  the legislatures to name a tax and leave it to be imposed by the Executive at its sweet will.  These horrible imaginings need not  detain us because neither does this flow from our  view nor  it is possible that such action will  go  unchallenged. The position of self-governing bodies is different from that of the Executive. For  these reasons we agree with the learned  Chief  Justice that the tax was validly imposed and the appeal in  relation to  it  must be allowed.  We agree in  the  order  regarding costs proposed by him. Shah, J. The facts which give rise to the appeals have  been set  out  in the judgments just delivered, and need  not  be repeated.

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Two  principal  questions arise for determination  in  these appeals :               (1)   Whether the Delhi Municipal  Corporation               (Validation of Electricity Tax) Act 35 of 1966               effectively  imposes liability to pay  tax  on               consumption  or  sale of electricity  for  the               period April 1, 1960 to March 31, 1966; and               (2)   Whether  ’by enacting s. 150(1)  of  the               Delhi  Municipal  Corporation Act 66  of  1957               which  confers authority upon the  Corporation               by resolution to levy tax               (1)   [1898] 2 Q.B. 91.               (2)   I.L.R. 1939 Allahabad 770.               (3)   I.L.R. 52 mad. 764.               (4)   I.L.R. 53 Mad. 722.               (5)   I.L.R. 5 Rang. 139.               (6)   A . ].R. 1931 Mad. 497.               (7) A.I.R. 1939 P.C. 53, 57.               290               in respect of the optional taxes specified  in               S.  113(2),  the Parliament has  violated  the               rule    against   excessive   delegation    of               legislative authority. Sub-section  (1)  of s. 113 of Act 66 of 1957  requires  the Corporation  to levy for the purposes of the Act  six  named taxes-(a) property taxes; (b) a tax on vehicles and animals; (c)  a theatre tax; (d) a tax on advertisements  other  than advertisements  published in the newspapers; (e) a  duty  on the transfer of property; and (f) a tax on buildings payable along  with  the application for sanction  of  the  building plan.   By  sub-s.  (2) the Corporation  is  authorised,  in addition  to the taxes specified in sub-s. (1), to levy  for the purposes of the Act any of the following taxes, namely               (a)   an education cess;               (b)   a local rate on land revenues;               (c)   a  tax on professions, trades,  callings               and employments;               (d)   a tax on the consumption, sale or supply               of electricity;               (e)   a  betterment  tax on  the  increase  in               urban land values caused by the ’execution  of               any development or improvement work;               (f)   a tax on boats; and               (g)   tolls. By  sub-s.  (3) it is provided that the taxes  specified  in sub-s.  (1)  and sub-s. (2) shall be  levied,  assessed  and collected  in accordance with the provisions of the Act  and the  bye-laws made thereunder.  The Act proceeds by ss.  114 to  149 to make detailed provisions in respect of the  taxes set out in s. 113(1) about the levy and imposition of taxes, the system of assessment, and maximum rates or the standards to  guide  the  determination  of the  rates  of  taxes  and incidental matters.  In respect of the optional taxes it  is provided in s. 150 of the Act that :               "(1) The Corporation may, at a meeting, pass a               resolution  for the, levy of any of the  taxes               specified  in sub-section (2) of section  113,               defining  the  maximum rate of the tax  to  be               levied, the class or classes of persons or the               description  or descriptions of  articles  and               properties   to  be  taxed,  the   system   of               assessment  to be adopted and the  exemptions,               if any, to be granted.               (2)   Any resolution passed under  sub-section               (1)   shall  be  submitted  to   the   Central

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             Government for its sanction, and if sanctioned               by  that Government, shall come into force  on               and from such date as may be specified in  the               order of sanction.               291               (3)   After  a resolution has come into  force               under  sub-section (2), the  Corporation  may,               subject  to  the maximum rate, pass  a  second               resolution  determining  the actual  rates  at               which ’the tax shall be leviable; and the  tax               shall come into force on the first day of  the               quarter of the year next following the date on               which such second resolution is passed.               (4)   After   a   tax  has  been   levied   in               accordance  with the foregoing  provisions  of               this  section, the provisions  of  sub-section               (2) of section 109, shall apply in relation to               such tax as they apply in relation to any  tax               imposed under sub-section (1) of section 113." There  is, it is manifest, a significant difference  in  the schemes  relating to the levy and imposition  of  compulsory and  optional  taxes,  fixation  of  rates  and  systems  of taxation.  Sections 114 to 149 set out elaborate  provisions relating to the maximum rates of tax to be levied, the class or classes of persons or the description or descriptions  of articles   and  properties  to  be  taxed,  the  system   of assessment  to be adopted and the exemptions, if any, to  be granted.   In  s. 114 the property taxes are  divided  under four heads : water tax, scavenging tax, fire tax and general tax.   The rates of water tax, scavenging tax and  fire  tax are  to be such percentages of the rateable value  of  lands and  buildings  as the Corporation may deem  reasonable  for providing  water supply, for providing  scavenging  services and  for  the  conduct and management of  the  Fire  Service Undertaking.   The  Parliament has, besides  specifying  the persons liable to tax and the system of assessment also  set out  standards  or guidelines for determining the  rates  of tax.  The general tax which is leviable in addition is to be not less than ten per cent and not more than twenty per cent of  the  rateable value of lands and  buildings  within  the urban  areas and such lower rates in the rural areas as  may be determined by the Corporation.  Sections 114 to 135 enact a  complete  code relating to the levy  of  property  taxes. Schedules 3 to 6 to the Act set out the maximum rates  which may  be charged as tax on vehicles and  animals,  theatretax and  taxes on advertisements and buildings, and  by  diverse provisions  in  Ch.  VIII the persons or  properties  to  be charged  are  specified and the mechanism of  assessment  is prescribed.   The  Act also prescribes the maximum  rate  of duty  on  transfer  of property leviable in the  form  of  a surcharge on the duty imposed by the Indian Stamp Act.’  But in  respect  of  optional taxes the  Parliament  has  merely enumerated  the  taxes  in sub-s. (2) of  S.  113,  and  has provided by sub-s. (3) of s. 113 that the taxes specified in sub-s.  (2)  shall  be levied,  assessed  and  collected  in accordance  with the provisions of the Act and the  bye-laws made thereunder. 292 Section  109  deals with the adoption of the  annual  budget estimates  of the Corporation.  It is provided by the  first subs of s. 109 that the Corporation shall, on or before  the 31st day of March of every year, adopt for the ensuing  year the  budget estimates of the income and expenditure  of  the Corporation  to be received and incurred on account  of  the municipal   government  of  Delhi,  Delhi  Electric   Supply

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Undertaking,  Delhi  Transport Undertaking and  Delhi  Water Supply and Sewage Disposal Undertaking.  By sub-s. (2) it is enacted  that on or before the 15th day of February of  each year  the  Corporation shall determine the  rates  at  which various municipal taxes, rates and cesses shall be levied in the  next following year and save as otherwise  provided  in the Act the rates so fixed shall not be subsequently altered for  the  year for which they have been fixed.   By  s.  110 power  is  reserved to the Corporation to alter  the  budget estimates  in  certain  circumstances  and  in  the   manner provided therein. The  scheme of levy and imposition of taxes reading ss.  113 to  150  with  the provisions relating to  the  adoption  of budget estimates, is that the Corporation determines in  the first instance the rates at which the municipal taxes, rates and cesses may be levied in the next following year and then prepares  the budget estimates in the light of the  estimate of income and expenditure.  The compulsory taxes have to  be levied subject to the limits or standards prescribed in that behalf by the Statute : in respect of the optional taxes the Corporation is left free to pass a resolution to levy all or any  of the optional taxes, prescribing the  maximum  rates, system   of  assessment,  the  incidence  of  taxation   and exemptions,  if any.  Having noticed the relevant  statutory provisions we may deal with the effect of the Validating Act 35  of 1966.  The High Court was of the view that by  merely fixing   the  rates  of  tax  on  consumption  or  sale   of electricity, for the period April 1, 1960 to March 31, 1966, the  Parliament had not effectively imposed  liability  upon the tax payers to pay that tax.  The first Subsection of  s. 2 of the Validating Act consists of two parts.  It commences with the non obstante clause and proceeds to enact-(a)  that the  resolution  of  the Corporation dated  June  24,  1959, insofar  as it relates to the determination of the rates  at which  tax shall be leviable on the consumption or  sale  of electricity   shall  be  deemed  to  have  been  passed   in accordance with law; and (b) that the rates specified in the said resolution in respect of tax on the consumption or sale of electricity shall be deemed to be, and to have, been, the actual  rates of tax under the Act "with effect on and  from the 1st day of July, 1959 and upto and inclusive of the 31st day  of  March,  1966".   The  non-obstante  clause  plainly governs  both the parts of s. 2 ( 1 ). It is clear  that  it was  the  intention  of  the  Parliament  to  declare   that notwithstanding anything contained in s.     150(2)  and  s. 109(2) of Act 66 of 1957, the resolution dated 293 June  24, 1959, purporting to be made under s. 150(3)  shall be deemed to be in accordance with law insofar as it relates to  the rates of electricity tax.  The effect of  the  first part of sub-s. (1) of s. 2 is therefore to impose  liability on  the consumption or sale of electricity purported  to  be levied  under  the resolution of the  Corporation  under  s. 150(3).  The High Court has accepted that position. By  the  second  part of sub-s. (1) of  s.  2  liability  is imposed  for payment of tax for the period April 1, 1960  to March 31, 1966, at the same rate, that is the rate which was adopted by the resolution dated June 24, 1959.  The function of  both  the parts is to, impose liability for  tax  levied under resolution of the Corporation under s. 150 (2).  It is true  that the second part does not expressly levy  tax  for the  period to which the rates were extended, but by  sub-s. (2) the Parliament has provided that all taxes on the_- con- sumption  or  sale of electricity "levied  or  collected  or purporting have been levied or collected in pursuance of the

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resolution dated June 24, 1959, shall, for all purposes,  be deemed  to  be, and to have always been, validly  levied  or collected."  The  Corporation  had year  after  year  passed resolutions  in  purported exercise of  authority  under  s. 150(1)  of  the  Corporation  Act for the  levy  of  tax  on consumption or sale of electricity, and by virtue of s. 2(1) of the Validating Act notwithstanding anything contained  in s.  150  and  sub-s.  (2) of s.  109  the  rates  under  the resolution dated June, 24, 1959, were to be deemed the rates for the years 1960-61 to 1965-66. Sub-section (2) of s. 2 of the Validating Act in terms deems the  tax levied or collected in pursuance of the  resolution referred  to in sub-s. (1).  The resolution referred  to  in sub-s. (2) is the resolution dated June 24, 1959; the  rates prescribed by that resolution are by the terms of sub-s. (1) made rates of tax on the consumption or sale of  electricity for  the period July 1, 1959 to March 31, 1966; and the  tax is  deem to be validly levied and collected for  the  entire period.  if the view which found favour with the High  Court be  correct, the taxes collected by or paid to’  the  Corpo- ration   would  not  be  liable  to  be  refunded   by   the Corporation,  suits  filed  for refund of  tax  may  not  be instituted  or continued, for the tax already paid, and  the acts  and proceedings taken in pursuance of  the  resolution will be deemed to be done in accordance with law, but  there being  no levy of tax, liability for payment of tax for  the period  referred to in sub-s. (1) of s. 2 could be  enforced This could not have been the intention of the Parliament. The  Parliament  was faced with the decision of  the  Punjab High  Court  that  the  levy of  the  tax  pursuant  to  the resolution  dated June 24, 1959, passed by  the  Corporation which  undoubtedly  was restricted to the year  1959-60  was invalid, because the Union. 294 Government had modified the rates fixed under the resolution of  the  Corporation under s. 150(1) for the  year  1959-60. Before the High Court decided the dispute, several years had elapsed  and the tax was collected on the footing  that  the resolution   dated  June  24,  1959,  and  the   resolutions subsequently passed were valid.  If the Parliament  intended to  enact an Act only for validating the levy of  tax  under the   resolution  dated  June  24,  1959,  it  was   plainly unnecessary  to  enact the, second part of s. 2  (1  ).  The decision of the High Court which necessitated the  enactment of  the Validating Act was undoubtedly the judgment  of  the Punjab High Court which related only to the. validity of the resolution levying tax for the year 1959-60, but that is not a  round for implying that ,’lie Parliament was  seeking  to validate the levy of tax only for the year 1959-60. We may turn now to the second question on which the argument was mainly advanced.  It was conceded by the AttorneyGeneral that under our Constitutional scheme, the Parliament  cannot abdicate  its  essential legislative functions  and  set  up another  authority or body to perfom  essential  legislative functions  either  generally or in respect of  a  particular head  of  legislation or even in respect of a  part  of  the subject-matter of that particular head.  Again the power  to enact subordinate or ancillary legislation to carry out  the details of parliamentary Acts may undeniably be invested  in other   bodies.    The  increasing  complexity   of   modern administration,   the  difficulty  of  passing   complicated measures  through  the method of  parliamentary  debate  and discussion, and the number of details and technical  matters which  must of necessity be provided for in  statutes,  have led  to an increase in the practice of entrusting  power  to

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executive or other agencies to make subsidiary or  ancillary legislation.  By entrusting that power to another body,  the Parliament  does  not  delegate  its  essential  legislative functions. But  the authority to entrust subsidiary or ancillary  power is  not unrestricted : the power cannot be conferred upon  a delegate  without  setting out some  principle,  policy,  or standard  which is to guide the delegate in discharging  its delegated  functions.   If  the  Parliament  lays  down   by legislative  act adequate guidance, whatever form it  takes, and  the delegate is required to conform to  that  guidance, entrustment of authority to the delegate to make su ordinate legislation  will  be  upheld.   The  power  of   delegating legislative  authority  cannot,  however,  be  extended   to investment  of  authority  in another  body  in  respect  of matters  relating to principle or policy of legislation,  to the  amendment  of Parliamentary Acts so as  to  affect  the substance  thereof or to investment in the  executive  power when no guidance or standard is laid down in that behalf  or to  authorize  the executive to encroach upon  the  judicial power of the State. 295 In  Panama Refining Company v. A. D. Ryan(1), Hughes,  C.J., pronouncing the majority opinion of the Supreme Court of the United States observed:               "The  Congress manifestly is not permitted  to               abdicate,  or  to  transfer  to  others,   the               essential legislative functions with which  it               is thus vested.  Undoubtedly legislation  must               often   be  adapted  to   complex   conditions               involving  a  host of details with  which  the               national  legislature  cannot  deal  directly.               The  Constitution has never been  regarded  as               denying   to   the  Congress   the   necessary               resources  of  flexibility  and  practicality,               which  will enablo it to perform its  function               in  laying  down  policies  and   establishing               standards,  while leaving to selected  instru-               mentalities  the making of  subordinate  rules               within prescribed limits and the determination               of  facts to which the policy as  declared  by               the legislature is to apply.  Without capacity               to give authorizations of that sort we  should               have the anomaly of a legislative power  which               in many circumstances calling for its exertion               would  be  but a futility.  But  the  constant               recognition  of the necessity and validity  of               such   provisions,  and  the  wide  range   of               administrative   authority  which   has   been               developed by Means of them, cannot be  allowed               to obscure the limitations of the authority to               delegate,  if our constitutional system is  to               be maintained."               Again  Chief Justice Hughes observed:  (at  p.               426)               "Applying that principle, authorizations given               by Congress to selected instrumentalities  for               the  purpose of ascertaining the existence  of               facts  to which legislation is directed,  have               constantly  been  sustained.   Moreover,   the               Congress may not only give such authorizations               to determine specific facts but may  establish               primary  standards, devolving upon others  the               duty  to  carry out the  declared  legislative               policy,  that  is, as Chief  Justice  Marshall

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             expressed  it, "to fill up the details"  under               the    general   provisions   made   by    the               Legislature." The  observations  of the Judicial Committee  of  the  Privy Council  made  in  Archibald G. Hodge  v.  The  Queen(1)  in relation  to the nature of delegated powers  exercisable  by the local legislature of the self-governing dominions do not imply a different rule.  In Archibald G. Hodge’s case(1) the Judicial  Committee observed that the local legislature  was competent  under  s. 92 of the British  North  America  Act, 1867,  to  make  Regulations  in the  nature  of  police  or municipal  regulations of a merely local character  for  the good government of taverns.  It was contended that  assuming that (1) 293 U.S. 388 : 79 . d. 446. (2) [1883] 9 A.C. 117. L6Sup.C.1/68-6 296 the  local  legislature  of Ontario Province  had  power  to legislate  to the full extent of the resolutions  passed  by the   License  Commissioners,  and  to  have  enforced   the observance   of   their   enactments   by   penalties    and imprisonment,  the  Imperial  Parliament  had  conferred  no authority  upon  the  local legislature  to  delegate  those powers  to the License Commissioners or any  other  persons, and   therefore  the  power  conferred  upon  the   Imperial Parliament  on the local legislature could be  exercised  in full  by the local legislature alone and no body else.   The Judicial  Committee rejected that contention on  the  ground that  the  maxim  "delegates non  potest  delegare"  had  no application   within  the  limits  of  subjects  and   areas prescribed  by  s.  92 as the  Imperial  Parliament  in  the plenitude  of its power possessed and could bestow.   Within those limits of subjects and areas the local legislature was supreme,  and  had  the  same  authority  as  the   Imperial Parliament,  or the Parliament of the Dominion,  would  have had  under  like  circumstances to confide  to  a  municipal institution  or body of its own creation authority  to  make bye-laws  or  resolution  as to subjects  specified  in  the enactment,  and  with the object of carrying  the  enactment into operation. and effect.  The Judicial Committee regarded the power to make the bye-laws as ancillary to  legislation, that  without it an attempt to provide for  varying  details and  machinery to carry them out might become oppressive  or absolutely fail, that entrustment of a limited discretionary authority to others has many illustrations of its  necessity and  convenience,  and that the legislature  by  "committing important  regulations  to  agents or  delegates"  does  not efface itself. The   Judicial  Committee  in  In  re  The  Initiative   and Referendum Act(1) struck down the Initiative and  Referendum Act (6 Geo. 5, c. 59, Manitoba) on the ground that it  would compel the Lieutenant-Govemor to submit a proposed law to  a body  of  voters totally distinct from  the  legislature  of which  he  is the constitutional head and would  render  him powerless  to  prevent  it from becoming an  actual  law  if approved  by those voters.  The offending provisions of  the Act being so interwoven with its scheme as not to be  sever- able,  the  Colonial Laws Validity Act, 1865, could  not  be applied to validate any part of the Act. Opinion  in this Court has with the passage of  time  become crystalized.   In re The Delhi Laws Act, 1912(2)  two  views were  broadly propounded.  Patanjali Sastri, J., was of  the view  that  the Indian Parliament acting within  the  limits circumscribing  its  legislative powers,  intended  to  have

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plenary  powers  of  legislation as large and  of  the  same nature   as  those  of  the  British  Parliament,   and   no constitutional  limitation on the delegation of  legislative power  to  a  subordinate  unit  was  to  be  found  in  the Constitution (1 )[1919] A.C. 935. (2) [1951] S.C.R. 747. 297 Acts.  The Indian Parliament is therefore competent to  make a law delegating legislative power, both quantitatively  and qualitatively  as  is  the British Parliament,  and  in  the absence  of  any constitutional  inhibition,  delegation  of legislative power, however extensive, could be made so  long as  the delegating body retained its own  legislative  power intact.   But  for the effacement of its  power  a  positive enabling  provision  in  the  constitutional  document   was required.  The learned Judge further observed that the Court cannot strike down an Act of Parliament as  unconstitutional merely  because  the  Parliament  decides  in  a  particular instance  to entrust its legislative power to its  appointed instrumentality,  however repugnant such entrustment may  be to  the  democratic process.  Fazl Ali and S. R.  Das,  JJ., expressed  views though not identical closely  approximating that-opinion. On  the other hand Kania, C.J., was of the opinion that  the essentials of legislative function are the determination  of the  legislative  policy and its formulation as  a  rule  of conduct.  If the legislature having made its laws leaves the details  for working out and for carrying an enactment  into operation to another subordinate agency or to some executive officer, there is no delegation of legislative power.  While the so-called delegation which empowers the making of  rules and   regulations  has  been  recognised  as  ancillary   to legislative  power,  the Constitution Acts in India  do  not recognise  a  general power in the legislature  to  abdicate legislative  authority.   Abdication  of  its  powers  by  a legislature   need  not  necessarily  amount   to   complete effacement of itself : it may be partial.  If full powers to do everything that the legislature can do are conferred on a subordinate authority, although the legislature retains  the power to control the action of the subordinate authority  by recalling such power by or repealing the Acts passed by  the subordinate  authority,  there  is still  an  abdication  or effacement of the legislature conferring such power. Mahajan,  J., agreed with Kania, C.J. According to  him  not only the nature of legislative power, but the very existence of  representative government depends on the  doctrine  that legislative  powers cannot be transferred.  The  legislature cannot substitute the judgment, wisdom and patriotism of any other  body, for those to which alone the people  have  seen fit  to confide this sovereign trust.  Unless the  power  of the  delegation is expressly given by the Constitution,  the Legislature   cannot  delegate  its  essential   legislative function  to any other body, and since the Indian  Constitu- tion does not give such a power to The Legislature it has no power to delegate the essential legislative functions to any other  body and that abdication by a legislative  body  need not  necessarily  amount to complete  effacement.   When  in respect of a subject in the Legislative List the legislative body says in effect that it will 298 not  legislate but will leave it to another to legislate  on that subject, there is abdication of legislative authority. Mukherjea, J., was of the opinion that the legislature  must retain in its own hands the essential legislative  functions

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which consist in declaring the legislative policy and laying down the standard which is to be enacted into a rule of  law and  what  can  be  delegated is  the  task  of  subordinate legislation  which  by its very nature is ancillary  to  the statute  which delegates the power to make it. Provided  the legislative  policy is enunciated with sufficient  clearness or  a  standard is laid down, the Courts may  not  interfere with   the  discretion  that  undoubtedly  rests  with   the legislature  itself in determining the extent of  delegation necessary in a particular case. Bose,  J., without definitely committing himself  to  either view,  observed  that the Indian  Parliament  may  legislate along the lines of the judgment of the Judicial Committee in Queen  v. Burah(1), that is to say, it can leave to  another person or body the introduction or application of laws which are,  or  may be, in existence at that time in any  part  of India  which  is  subject  to  the  legislative  control  of Parliament, whether those laws are enacted by Parliament  or by a State Legislature set up by the Constitution, and  that he  saw  no reason for extending the  scope  of  legislative delegation beyond the confines which have been hallowed  for so long. Since  opinion in that case was delivered, in several  cases brought before this Court, the extent of the power which the Legislature possesses to delegate legislative authority  was discussed.   A brief summary of some of those cases  may  be attempted. In  Rajnarain  Singh v. The Chairman,  Patna  Administration Committee,   Patna  and  Anr.(2)  Bose,  J.,  attempted   to summarise  the effect of the various opinions  expressed  in the  Delhi  Laws Act case(1), and speaking for  a  unanimous Court observed that an executive authority can be authorised by  a statute to modify either existing or future laws,  but not in any essential features.  Exactly what constitutes  an essential feature cannot be enunciated in general terms, but it  is  clear that modification cannot include a  change  of policy.   Essential  legislative function  consists  in  the determination of the legislative policy and its  formulation as  a  binding  rule of conduct.   Modifications  which  are authorised  are limited to local adjustments or  changes  of minor  character  and do not mean or involve any  change  of policy or change in the Act. In  Harishankar Bagla v. The State of Madhya Pradesh (4)  in dealing  with  the validity of cl. 3 of the  Cotton  Textile (Control  of  Movement)  Order,  1948,  promulgated  by  the Central Govern- (1) 5 I.A. 178.         (2) [1955] 1S.C.R. 290. (3) [1951] S C.R. 747.       (4) [1955] IS.C R. 380. 299 ment under S. 3 of the Essential Supplies (Temporary Powers) Act, 1946, it was observed that 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,  and where the Legislature has laid down such a principle in  the Act  and  that principle is the maintenance or  increase  in supply  of essential commodities and of  securing  equitable distribution and availability at given prices, the  exercise of the power was valid. Within the framework of the case law so far developed,  Ven- katarama Aiyar J., in Pandit Banarsi Das Bhanot v. The State of  Madhya  Pradesh  & Ors.(1)  speaking  for  the  majority observed               "......  the authorities are clear that it  is               not  unconstitutional for the  legislature  to

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             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 like." The learned Judge held that the power conferred on the State Government  by  s. 6(2) of the Central Provinces  and  Berar Sales  Tax  Act,  1947, to amend the  Schedule  relating  to exemptions  was in consonance with the accepted  legislative practice relating to the topic and was not unconstitutional. In The Western India Theatres Ltd. v. Municipal  Corporation of  the City of Poona ( 2 ) it was held that by enacting  in S.  59(1) (xi) of the Bombay District Municipal  Act,  1901, that the Municipality may levy "any other tax" to the nature and object of which The approval of the  Governor-in-Council shall  have  been  obtained  prior  to  the  selection   the Legislature  has  not  abdicated  to  the  Municipality  its legislative  authority.   Since the section  authorised  the imposition of taxes alone as were necessary for the  purpose of  the Act, the taxes could, it was held by the  Court,  be levied  only  for  implementing those purposes  and  for  no others, and delegation on that account was not unguided. In Vasantlal Maganbhai Sanjanwala v. The State of Bombay and Ors.(3)  the  validity  of s. 6(2)  of  the  Bombay  Tenancy and .Agricultural Lands Act 67 of 1948 which authorised  the Provincial  Government  by  notification  in  the   Official Gazette  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 other suitable basis as it thought  fit fell  to  be determined.  Speaking for the majority  of  the Court, Gajendragadkar, J., observed that although the  power of delegation was a constituent element of (1) [1959] S.C.R. 427.   (2) [1959] Supp. 2 S.C.R. 71. (3)  [1961] S.C.R. 341. 300 legislative  power,  the  legislature  cannot  delegate  its essential legislative function in any case and before it can delegate any subsidiary or ancillary powers to a delegate of its  choice,  it must lay down the  legislature  policy  and principle  so as to afford the delegate proper  guidance  in implementing the same. In Corporation of Calcutta and Anr. v. Liberty Cinema(1), it was  held that the Calcutta Municipal Corporation had  power to  levy  fee pursuant to a resolution, in exercise  of  the power  under s. 548(2) of the Calcutta Municipal Act,  1951, at  such  rates  as may from time to time be  fixed  by  the Corporation.   It  was  observed by the  majority  that  the fixing  of  the rate of a tax not be in of  the  essence  of legislative  power may ’be left to a  non-legislative  body, but when it is so left to another body the legislature  must provide  guidance  for such fixation, and that in  the  case before  the Court there was sufficient guidance in  the  Act for determining the rate of the levy under S. 548. Two  recent cases may also be noticed : In B. Shama  Rao  v. Union  Territory of Pondicherry (2 ) this Court held that  a statute which extended the Act passed by another Legislature as  it stood immediately before the date on which it was  to be  brought  into  force by a  notification  issued  by  the Government   was   "void  and   still-born",   because   the Legislature  in enacting the Act in that manner had  totally abdicated  its legislative functions and had surrendered  it in favour of another Legislature. In  M/s.   Devi  Das  Gopal  Krishan  v.  State  of   Punjab and OrS.(2), Subba Rao C.J. speaking for the Court  observed

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in  dealino, with a case under the Punjab General Sales  Tax Act, 1948               "The Constitution confers a power and  imposes               a  duty on the legislature to make laws.   The               essential   legislative   function   is    the               determination  of the legislative  policy  and               its  formulation as a rule of conduct.   Obvi-               ously  it  cannot abdicate  its  functions  in               favour  of  another.   But  in  view  of   the               multifarious activities of a welfare State, it               cannot presumably work out all the details  to               suit   the  varying  aspects  of   a   complex               situation.   It must necessarily delegate  the               working out of details to the executive or any               other agency.  But there is a danger  inherent               in  such  a process of delegation.   An  over-               burdened  legislature or one controlled  by  a               powerful  executive  may unduly  overstep  the               limits of delegation.  It may not lay down any               policy  at all; it may declare its  policy  in               vague and general terms; it may not set down               (1)       [1965]      2      S.C.R.       477.               (2) A.I.R. 1967 S.C. 1480               (3)   A.I.R. 1967 S.C. 1895,1901.               301               any   standard   for  the  guidance   of   the               executive; it may confer an arbitrary power on               the  executive to change or modify the  policy               laid  down by it without reserving for  itself               any  control  over  subordinate   legislation.               This  self effacement of legislative power  in               favour of another agency either in whole or in               part  is  beyond  the  permissible  limits  of               delegation." On a review of the cases the following principles appear  to be well-settled : (i) Under the Constitution the Legislature has plenary powers within its allotted field; (ii) Essential legislative function cannot be delegated by the Legislature, that is, there can be no abdication of legislative  function or  authority by complete effacement, or even  partially  in respect  of  a particular topic or matter entrusted  by  the Constitution  to  the  Legislature;  (iii)  Power  to   make subsidiary or ancillary legislation may however be entrusted by  the Legislature to another body of its choice,  provided there  is  enunciation of policy, principles,  or  standards either  expressly or by implication for the guidance of  the delegate  in  that  behalf.  Entrustment  of  power  without guidance  amounts  to excessive  delegation  of  legislative authority;   (iv)  Mere  authority  to  legislative   on   a particular  topic does not confer authority to delegate  its power to legislate on that topic to another body.  The power conferred  upon the Legislature on a topic  is  specifically entrusted to that body, and it is a necessary intendment  of the  constitutional provision which confers that power  that it  shall not be delegated without laying  down  principles, policy,  standard  or guidance to another  body  unless  the Constitution  expressly  permits  delegation;  and  (v)  the taxing provisions are’ not exception to these rules. It was asserted that the doctrine of excessive delegation of legislative  power  is  inapplicable to  the  conferment  of taxing  power  on local authorities.  It was said  that  the power  to  tax is in its essence a sovereign  power  of  the State, and since a Municipal Corporation exercises auxiliary authority   in  the  important  business  of   local   self- government,  in  exercising  the power to  tax  for  limited

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municipal  purposes, it is not acting as a delegate, but  on behalf  of  the State.  We are unable to  accept  the  broad proposition  that when authority is conferred upon  a  local authority  by  the Legislature to tax, the  local  authority exercising power so conferred acts as an agent of the-State. A local authority is undoubtedly an instrument of the  State in the matter of local government restricted to a particular area in which it functions.  By investing a local  authority with  powers  of legislation for administration of  the  Act relating  to local government, sovereign power of the  State is  entrusted  to  the body for limited purpose  :  but  the entrustment of power is as a delegate, and must in our  view be within the 302 limits  of  permissible  entrustment  consistent  with   the constitutional scheme.  The power of the State to  legislate in matters of taxation within the allotted field is plenary, but  in  entrusting  that power to  a  local  authority  the legislature cannot confer unguided authority. In  our judgment, the constitutional power to  legislate  in respect  of a particular topic such as  local  government-in Entry 5 List II of the Seventh Schedule-does not carry  with it  the power to delegate the legislative functions  of  the State.   Entry  5  List  II.  confers  upon  the  State  the authority  to legislate in respect of local government  that is  to  say,  the  constitution  and  powers  of   municipal corporations,  improvement trusts, district  boards,  mining settlement  authorities and other local authorities for  the purpose of local self-government or village  administration. Authority to legislate in respect of powers of local  bodies may  encompass  authority  to confer power  upon  the  local bodies  to  tax  within  certain  specific  fields  in   the appropriate list But the power conferred by the  legislative entry      cannot      override      the      constitutional limitations  .against abdication of  legislative  authority. The expression "power" therefore does not include  authority to  delegate  the  essential  legislative  function  without disclosing principles, policy, or standard guiding the local bodies in the exercise of the power. Again the guidance which saves delegation from the vice of ,excessiveness  may be express or may be implied :  and  the extent  ,of the guidance must be determined by the  subject- matter of legislation and the power entrusted.  But, in  our judgment, the delegation cannot be upheld, merely because of the special status, character, competence or capacity of the delegate  or  by  reference to the provisions  made  in  the statute  to prevent abuse by the delegate of its  authority. The question is one of the restriction upon the power of the legislative  body to delegate the power of  legislation  and that  restriction is not removed because the delegate  is  a high  dignitary  of the State or is especially versed  in  a particular   branch   of  administration  or   has   special information or is in a position to collect that information, or  is not likely to abuse its authority.  The  Constitution entrusts the legislative functions to the legislative branch of  the  State,  and directs that  the  functions  shall  be performed  by  that  body  to  which  the  Constitution  has entrusted  and not by some one else to whom the  Legislature at  a given time thinks it proper to delegate  the  function entrusted to it. A body of experts in a particular branch of undoubted integrity or special competence may probably be in a  better position to exercise the power of  legislation  in that  branch, but the Constitution has chosen to invest  the elected representatives of the people to exercise the  power of  legislation,  and not to such bodies of  ,experts.   Any

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attempt on the part of the experts to usurp, or 303 of  the  representatives  of  the  people  to  abdicate  the functions  vested in the legislative branch is  inconsistent with  the constitutional scheme.  Power to make  subordinate or ancillary legislation may undoubtedly be conferred upon a delegate, but the Legislature must in conferring that  power disclose  the policy, principles or standards which  are  to govern  the delegate in the exercise of that power so as  to set out a guidance.  Any delegation which transgresses  this limit infringes the constitutional scheme. It is necessary then to consider whether in the present case the   Parliament  has  disclosed  any  policy,   principles, standards  or  guidance  in conferring  authority  upon  the Corporation  to  fix  the  rates  of  tax  selected  by  the Corporation  out  of the list contained in s.  113  (2),  to select  persons to be rendered liable to tax, the system  of assessment  to be adopted and the exemptions, if any, to  be granted.  The Act leaves it to the Corporation by resolution to define the maximum limits of tax to be levied, the  class or  classes of persons, or descriptions or  descriptions  of articles   and  properties  to  be  taxed,  the  system   of assessment  to be adopted and the exemptions, if any, to  be granted.    The  Act  discloses  by  express  enactment   no standard,  no  principle  and no policy  laid  down  by  the Parliament   to  guide  the  Corporation  in   levying   and collecting  the optional taxes.  By providing in sub-s.  (2) of  s.  150 that the resolution will come into force  on  or from  the date as may be specified in the order of  sanction of  the  Central  Government,  an  overriding  authority  is conferred  upon  the  Union Executive, but  that  is  not  a substitute  for guidance.  Counsel for the  Corporation  and some  interveners  contended  that the  Act  contained  some indications of policy and principles governing the  exercise of  the  power  to tax.  They relied upon  the  use  of  the expression "for the purposes of this Act" in S. 1 13 (2) and contended   that  this  was  sufficient  guidance   to   the Corporation.   The Corporation is undoubtedly  competent  to levy tax only for the purposes of the Act, and for no  other purpose  and  by providing expressly what is implicit  in  a statute  relating  to  municipal  taxation  no  guidance  is furnished  to the Corporation in the exercise of  the  power delegated.  Even if the expression "for the purposes of this Act"  were not used in s. 113(2), the Corporation could  not levy  or  collect taxes for purposes other  than  those  for which  it  is  set  up by the Act.   The  Corporation  is  a statutory body charged with municipal administration.  It is a body corporate with power to acquire, hold and dispose  of property  in  its  name,  and  is  charged  with   municipal government,  and  can  exercise  its  powers  only  for  the purposes of the Act, and for no other purpose.  Again by the use  of  the expression "for the purposes of  this  Act"  no principle, policy, or standard is disclosed in the matter of the   rates  of  tax,  liability  of  persons,  objects   or transactions  to  be  taxed, and the  scheme  or  system  of taxation to be adopted. 304 It  was then urged that the delegate being  the  Corporation which  is  traditionally  associated with  the  exercise  of functions in the sphere of local government, it has the same powers which the State has within the limited field allotted to  it,  and  therefore when the Legislature  of  the  State confers upon the Corporation the power to tax, it is not  in substance delegating any legislative function, but investing the  Corporation with the State’s power to tax.  As we  have

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already  observed, the power to tax vested in the  State  is because  of  the exigencies of administration  invested  for limited purposes in local bodies, but the investment is as a delegate of, and not as an agency of, the State. It was also said that the standards or guidance furnished by the  Act for exercising the delegated authority are  to  ’be found  in "the needs of the Corporation", and "needs of  the Corporation" are of necessity an adequate guidance.   Strong reliance in that behalf was placed upon the judgment of this Court in the Liberty Cinema’s case(1), which we have already referred.   Sarkar,  J., speaking for the  majority  of  the Court observed at p. 494 :               "It  seems  to  us  that  there  are   various               decisions  of  this Court  which  support  the               proposition that for a statutory provision for               raising  revenue  for  the  purposes  of   the               delegate,    as   the   section   now    under               consideration is, the needs of the taxing body               for  carrying  out  its  functions  under  the               statute  for which alone the taxing power  was               conferred   on  it,  may   afford   sufficient               guidance to make the power to fix the rate  of               tax valid." The  learned Judge proceeded to derive the principle  stated by him from the decisions in The Western India Theatres  Ltd v. Municipal Corporation of the City of Poona(1);  Vasantlal Maganbhai  Sajanwala v. The State of Bombay (3) ;  Union  of India v. Bhana Mal Gulzari Mal(1); Harishankar Bagla v.  The State  of  Madhya Pradesh(2).  But the cases cited  did  not make  the  needs of the taxing body a test  for  determining whether guidance was furnished to the delegate in exercising the power to tax.  While we agree with the view expressed by Sarkar,  J.,  that  in the case of  a  self-governing  local authority  with taxing power, a large amount of  flexibility in  the  guidance to be provided for the  exercise  of  that power  must  exist, we are unable to hold that  because  the delegate  is  a local authority which "needs"  large  funds, depending upon diverse and changing circumstances, the power conferred  upon  the Corporation to adjust the  tax  to  its varying needs may be regarded as in adequate guide. (1)[1965]  2 S.C.R. 477. (2) [1959] Supp. 2 S.C.R.  71.  (3) [1961] S.C.R. 341. (4) [1960] 2 S.C.R. 627. (5)  [1955] 1 S.C.R. 380. 305 If  the needs of a local body be an indication of  guidance, the   rule  against  excessive  delegation  of   legislative authority is reduced to a varnishing paint.  The requirement of a large degree of flexibility in the matter of  municipal taxation can in any event be no guidance in determining  the persons,  properties or transactions, which are to be  taxed and the system of taxation to be adopted.  Failure to give a guidance  in  respect  of  all  these  matters  exposes  the legislation  to the vice ’of excessive delegation.   In  the Liberty  Cinema’s case(1) the Corporation was invested  with the power to fix the rates : the persons who were liable  to pay  the  tax,  and the system  of  assessment  were  easily determinable  by  the scheme of the Act and no  question  of exemption fell to be determined. In  M/s.   Devidas Gopal Krishnan’s case 2 Subba  Rao,  C.J. speaking for the Court observed               "The argument of the learned Counsel (for  the               State)  that such a policy could  be  gathered               from  the constitutional provisions cannot  be               accepted,  for, if accepted, it would  destroy               the  doctrine  of  excessive  delegation.   It

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             would  also  sanction conferment of  power  by               Legislature   on  the   executive   Government               without  laying  down any  guidelines  in  the               Act." The Court was concerned with the delegation of uncontrolled’ power to the executive Government to fix rates of sales tax. In, our judgment, in the case of a statute delegating taxing power  to  a  municipality,  the same  rule  applies  and  a guideline   cannot  be  inferred  from  the   constitutional provision conferring power to tax. It  was  also  said that the action of  the  Corporation  in levying and imposing optional taxes is subject to a two-fold control  :  (1)  the  Act  expressly  prescribes  that   the resolution  of  the Corporation shall be sanctioned  by  the Central Government before it becomes effective; and (2) that the act of levying tax together with all incidental  matters is  entrusted  to a body of elected representatives  of  the people  who  are responsible to the electorate.  We  do  not think  that  the  existence  of  either  of  these  controls warrants  a  departure  from  the  rule  against   excessive delegation.    They  may  probably  operate   as   effective safeguards   against  abuse.   But  the   Constitution   has entrusted the power of legislation to the Parliament and has also  imposed  a  restriction  against  delegation  of   its authority without setting out, guidance to the delegate; the Parliament   cannot  by  providing  against  abuse  of   its functions  by  its delegate reduce the rigour  of  the  rule against  excessive  delegation  of’  authority.   The   rule against  excessive  delegation  of  legislative,power  is  a restriction  upon  the power of Parliament :  whether  in  a given  instance  the  rule is violated must  depend  on  the nature (1) [1965] 2 S.C.R. 477. (2) A.I.R. 1967 S.C. 1895,1901. 306 and  the extent of delegation and not by the application  of the test that delegation of authority to some other body may more ,effectively administer the Act.  If the argument  that by  imposition  of  controls which  ensure  that  the  power delegated will not be abused by the Corporation is  regarded as  determinative  of the policy or  principle  guiding  the Corporation, it may be open to the Legislature in many other cases  e.g. in statutes relating to  Income-tax  Wealth-tax, Sales-tax  and  the  like,  to delegate  the  power  to  tax including  the  fixation  of  rates,  persons,  objects  and transactions  to  be charged, the system of taxation  to  be adopted   and   other   related  matters   to   persons   of unimpeachable  credit  and undoubted  technical  competence, with   avenues  and  means  for  collecting  The   necessary information and for acting upon it.  Whether that scheme  of levying  a  tax may, on practical considerations  be  deemed better suited to effective administration of the taxing Acts than  the vote of the elected representatives of the  people is a matte-,,on which no opinion need be expressed.  It  may suffice to state that such entrustment of legislative  power with-out guidance is in consistent with the basic concept on which   our   constitutional   scheme   is   founded.    Our Constitution-makers have entrusted the power of  legislation to  the  elected representatives of the people so  that  the power is exercised not only in the name of the people but by the  people.   The  rule  against  excessive  delegation  of legislative  authority  is  a  necessary  postulate  of  the sovereignty  of  the people.  It is not claimed  to  be  nor intended to be a panacea against the shortcomings of  public administration.    Governance   of  the  State   in   manner

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determined by the people through their representatives being of  the essence of our form of government, the plea  that  a substitute  scheme for governance through delegate;  may  be more  effective is destructive of our  political  structure. If  it  be remembered that legislation on a given  topic  is intended to be a declaration of the popular will relating to the  administration  of  that topic  in  the  larger  public interest,  the futility of the argument that a  delegate  of the  Legislature  which  is  invested  with  the  power   to determine and announce the popular will, may either  because of its special competence, or because of controls on it will be as good as, or even better than, the legislature, becomes obvious. The  circumstance  that the affairs of the  Corporation  are administered  by the elected representatives responsible  to the  people  is  in  our  judgment,  wholly  irrelevant   in determining  whether the rule against  excessive  delegation may  be  departed  from.  If that  exception  be  true,  the Parliament may justifiably delegate its power to enact  laws to  other  bodies merely by the  expedient  of  constituting those bodies from among the representative of the people. It  may  also  be noticed that under s.  490  of  the  Delhi Municipal  Corporation Act’, 1957, in certain  eventualities the Central 307 Government may supersede the Corporation for such period  as may   be  specified  in  the  order.   When  the  order   of supersession  is passed all councillors and aldermen  vacate their  offices and during the period of supersession of  the Corporation,  all  powers and duties conferred  and  imposed upon the Corporation are exercisable and performable by such officer  or authority as the Central Government may  appoint in  that behalf, and that would include power  of  taxation. Certainly  during  the period that the  Corporation  remains under supersession, the power to tax would be exercised’  by a nominee of the Central Government and not by the represen- tatives of the people. The  Parliament has undoubtedly at any given time power  to, withdraw  the delegated power in favour of the  Corporation. But  by  retaining  authority to  withdraw  power  from  the delegate, no. principles, policy, or standards governing the delegate are set out.  If an express provision which ensures against  abuse is not a substitute for guidance  in  another garb,  the  power of the Parliament to,  withdraw  authority will not for the like reason be a substitute. It  was  then  said  that there has  been  a  long  standing practice. in the Indian Legislatures for conferring upon the Corporations and Municipalities power to tax in the form  in which  it  is conferred by s. 1 1 3 (2).  But the  issue  of constitutional  validity of the provisions  under  challenge cannot  be  permitted  to  be  clouded  by  reference  to  a practice,  assuming that it is of a long duration.  We  have not thought it necessary to, and it would be impossible  for us to examine all the statutes under which the power has, it is   claimed,  been  conferred  upon  the  Corporations   or Municipalities in the form in which it has been conferred by s. 113(2) of the Act. It was also said that it is impossible for the  Legislature, having regard to the varying needs of the Municipalities  to lay  down any guidance, principles or policy to govern  them in the imposition of diverse taxes.  But that argument  has, in  our judgment little substance.  In the  Delhi  Municipal Corporation Act, 1957, the imposition of major taxes set out in sub-s. (1) of s. 113 is made subject to clear and precise provisions  providing for principles. policy and  standards.

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It is only in respect of the optional taxes set out in  sub- s. (2) of s. 113 that no such guidance is disclosed.  It was also  urged that fixing a maximum rate is not any  guidance, because  it would be possible for the Legislature to  fix  a maximum rate which is wholly unrelated to the realities, and the formal requirement of guidance may, by prescribing  that unreal  maximum, be complied with.  But it is not  suggested that in all cases by fixing a maximum rate, a guidance would be  deemed  to be supplied.  Fixing of  maximum  rate  which prevents the Corporation or Municipality from levying a  tax at a rate higher than that 308 rate, to be a guidance, must not be wholly unrelated to  the demands  of the Corporation, the capacity of the  tax-payers to bear the liability and the other relevant matters. Reliance was sought to be placed upon the minority  judgment ,of  this  Court in Municipal Board,  Hapur  v.  Raghuvendra Kripal and Ors. (1).  The primary question which fell to  be determined in that case related to the validity of s. 135(3) of the U.P. Municipalities Act 2 of 1916, which shut out all enquiry  into the regularity of the procedure by  which  tax has  been imposed after the sanction of the Government to  a resolution   of  the  Municipality  selecting  a   tax   for imposition  had been obtained.  It was held by the  majority that  the rule of conclusive evidence in s. 135 (3) did  not shut out all enquiry by courts.  The Court incidentally con- sidered  the  question whether the enactment of s.  135  (3) amounted  to delegation of legislative power to tax  insofar as the rate and incidence were concerned and in the minority judgment it was ,observed that the Legislature may  delegate to  a  subordinate authority the power ’to fix  rates  under proper  safeguards, and ’it is not necessary to specify  all the  situations  under  which this can  be  ,done.   It  was observed at p. 970 :               "But there can be no doubt that in the  matter               of  local taxation like taxation by  municipal               boards,  district  boards and bodies  of  that               character  there is pre-eminertly a  case  for               delegating the fixation of the rate of tax  to               the  local body, be it a municipal board or  a               district  board  or some other board  of  that               kind.  The reason for this is that problems of               different  municipalities or districts may  be               different and one municipality may require one               kind  of  tax  at  a  particular  rate  at   a               particular time while another municipality may               need  another kind of tax at another  rate  at               some  other time.  Therefore, the  legislature               can  in the case of taxation by  local  bodies               delegate even the authority to fix the rate to               the  local body provided it has taken care  to               specify   the  safeguards  in  the   form   of               procedural  provisions or such other forms  as               it considers necessary in the matter of fixing               the rate." If  thereby  it  is meant that the  rule  against  excessive delegation of legislative power may be departed from on  the ground  that  the  delegate  is hedged  in  by  controls  or restrictions   which  will  prevent  it  from  abusing   its authority, we are unable to agree.  Safeguard% against abuse do  not  alter the character of unauthorised  delegation  of legislative  power.   They cannot be a  substitute  for  the guidance  which the Constitutional Scheme requires that  the Parliament must give to a delcgate.  As the validity of  the constitutional protection ,cannot be judged in the light  of

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what the character, capacity or (1)  [1966] 1 S.C.R. 950. 309  special aptitude of the delegate may be, it cannot also  be djudged in the light of the provisions made against abuse of power Turning to the terms of S. 113(2) of the Act, we are of  the pinion that the Parliament has not set out the limits of the tax  which  will  be  levied,  persons  from  whom  or   the transactions  on which the taxes will be levied, the  system of  taxation which will be adopted, and the  exemptions,  if any,  which will be granted.  All these matters are left  to the Corporation.  In possible cases such a power is  capable of  the grossest abuse.  We may, however, hasten to  observe that  the  vice of delegationlies not in  its  capacity  for abuse,  but in its delegation beyond permissible limits  and contrary   to   the  constitutional   scheme.    Undoubtedly delegation of the authority to legislate on those mat ers is always  subject to the rule that the action of the  delegate which  amounts to unreasor able exercise of the powers  will be  invalid.  But that does not alter the true character  of the   rule  against  excessive  delegation  of   legislative authority. In  our  view, the provisions of S. 150(1) insofar  as  they leave to the Corporation to fix the maximum rates of tax  to be  levied, class or classes of persons, or the  description or description of ,Articles and properties to be taxed,  the system of assessment to be adopted and the exemptions if any to be granted are invalid.  We hold that the Validating  Act 35 of 1966 validly levies and imposes tax on consumption  or sale of electricity till March 31, 1966.  It will however be declared  that  S. 150(1) is void  as  permitting  excessive delegation of legislative authority to the Corporation. Sikri, J. I have had the advantage of reading the  judgments prepared by the learned Chief Justice Hidayatuilah, J.,  and Shah,  J.  I agree with the learned Chief Justice  that  the appeals  be allowed and with the order regarding  costs.   I further agree with the reasons given by him for holding  (a) that  the tax was imposed on consumption of electricity  (b) that  the sanction by Government was in accordance with  the provisions of the Constitution, and (c) that the  Validation Act  validated the levy and collection for the period  April 1,  1960, to March, 1966.  But as I hold different views  as to  the  powers of legislatures in India,  I  would  briefly indicate them. Apart from authority in my view Parliament has full power to delegate legislative authority to subordinate bodies.   This power   flows,  in  my  judgment,  from  At.  246   of   the Constitution.   The word "exclusive" means exclusive of  any other legislature and not exclusive of any subordinate body. There  is, however, one resriction in this respect and  that is also contained in Art. 246. 310 Parliament must pass a law in respect of an item or items of the  relevant list.  Negatively this means  that  Parliament cannot abdicate its functions.  It seems to me that this was the position under the various Government of India Acts, and the Constitution ha,, made no difference in this respect.  I read  Hodge v. R.(1) and Power v. Appollo Candle  Co.(1)  as laying  down that legislature like Indian  legislatures  had full power to delegate legislative authority to  subordinate bodies.   In  the judgments in these cases no such  word  as "policy" "standard" or "guidance" is mentioned.  It is  true that in Hodge v. R.(1) the words ’ancillary to  legislation’ are  mentioned but if we examine ss. 4 and 5 of  the  Liquor

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License  Act,  1877, it would be found that no  guidance  is contained in these sections for defining the conditions  and qualifications  requisite  to obtain  tavern  licenses,  for limiting  the  number of tavern and shop licenses,  and  the nature  of  the  penalty to be imposed  for  the  infraction thereof.  Any person drafting these conditions and  qualifi- cations  and other matters will find no guidance in S. 4  or S.  5 of the Liquor License Act.  It is, however, true  that the  objective  to be achieved is given in the Act  and  the words  "ancillary to legislation" in the context  must  mean ancillary to the objective underlined in the legislation. The  case of In re : The Initiative and  Referenidum  Act(3) provides  an  instance  of  abdication  of  functions  by  a legislature.  No inference can be drawn from this case  that delegations  of the type with which we are concerned  amount to abdication of functions. The   question  then  arises  :  Is  the   Delhi   Municipal Corporation  Act,  1957, a law with respect to  any  of  the items in List II ? The answer is plainly in the affirmative. I  can  see  no  sign of  abdication  of  its  functions  by Parliament  in  this Act.  On the  contrary  Parliament  has constituted  the Corporation and prescribed its  duties  and powers in great detail. But assuming I am bound by authorities of this Court to rest the  validity  of s. 113 (2) (d) and s. 150 of  the  Act  by ascertaining whether a guide or policy exists in the Act,  I find adequate guide or policy in the expression "purposes of the Act" in s. 113.  The Act has pointed out the  objectives or  the  results to be achieved and taxation can  be  levied only  for  the purpose of achieving the  objectives  or  the results.    This,  in  my  view,  is   sufficient   guidance especially to a self-governing body like the Delhi Municipal Corporation.  It is not necessary to rely on  the-safeguards mentioned  by  the  learned Chief  Justice  to  sustain  the delegation. There  is no need to think that delegations of  the  present type  will lead to arbitrary taxation or rules.   First,  we must have faith (1) 9 A.C 117. (2) 10 A.C. 282. (3) [1919] A.C. 935. 311 in our representative bodies and secondly, I agree with  the learned Chief Justice and Hidayatullah, J., that in suitable cases  taxation  in  pursuance  of  delegated  powers  by  a Municipal Corporation can be struck down as unreasonable  by Courts.   If Parliament chooses to delegate wide  powers  it runs the risk of the bye-laws or the rules framed under  the delegated power being challenged as, unreasonable.                            ORDER In accordance with the opinion of the majority, the  appeals are allowed, the order of the High Court is set aside in  so far  as it is against the appellant and the  writ  petitions filed  by  the respondent are dismissed.  There will  be  no order as to costs, throughout. R.K.P.S. 6Sup.  Cl/68-7 312