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PETITIONER: VASANTLAL MAGANBHAI SANJANWALA

       Vs.

RESPONDENT: THE STATE OF BOMBAY AND OTHERS.(AND CONNECTED APPEAL)

DATE OF JUDGMENT: 25/08/1960

BENCH: GAJENDRAGADKAR, P.B. BENCH: GAJENDRAGADKAR, P.B. SINHA, BHUVNESHWAR P.(CJ) KAPUR, J.L. SUBBARAO, K. WANCHOO, K.N.

CITATION:  1961 AIR    4            1961 SCR  (1) 341  CITATOR INFO :  R          1964 SC 980  (8)  R          1965 SC1107  (29,79,80,ETC.)  RF         1967 SC 212  (26)  OPN        1967 SC1048  (20)  R          1967 SC1895  (13)  RF         1968 SC1232  (18,85,95)  RF         1973 SC1374  (11)  RF         1973 SC1461  (227,450,566)  R          1974 SC1660  (20)  O          1978 SC1296  (46)  RF         1978 SC1457  (60)  RF         1979 SC 321  (10)  R          1980 SC 350  (8)  RF         1980 SC2181  (145)  F          1986 SC1172  (7,10)  R          1990 SC 560  (13)

ACT: Agricultural  Tenancy,  Regulation  of-Enactment  empowering Government   to   fix  lower  rate  of   maximum   rent   by notification-If    vitiated   by    excessive    delegation- Notification,  validity of-Bombay Tenancy  and  Agricultural Lands Act, 1948 (Bom.  LXVII of 1948), s. 6(2).

HEADNOTE: Section  6(1) of the Bombay Tenancy and  Agricultural  Lands Act,  1948 (Bom.  LXVII of 1948), provided that the  maximum rent payable by a tenant shall not in the case of  irrigated land  exceed  one-fourth and in the case of any  other  land exceed  one third of the crop of such land or its  value  as determined  by the prescribed manner.  Section 6(2)  of  the Act read as follows,-- "  The  Provincial Government may, by  notification  in  the Official  Gazette,  fix  a lower rate of  the  maximum  rent payable  by the tenants of lands situate in  any  particular area or may fix such rate on any other suitable basis as  it thinks fit." By  a  notification  under that section  the  Government  of Bombay,   in   supersession  of  all   other   notifications

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prescribed a rate of maximum rent which was very much  lower than  the one previously fixed.  The petitioners  challenged the  vires  of  the said section and  the  validity  of  the notification  under  Art. 226 of the Constitution,  but  the High   Court   found  against  them.    The   question   for determination in these appeals was whether s. 6(2) conferred unguided  power on the Government and was void by reason  of excessive delegation of legislative power. 342 Held  (per Sinha, C. J., Kapur, Gajendragadkar and  Wanchoo, jj.) that 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.  It  is  in that  light  that  the  preamble  of  the  statute  and  its provisions relating to delegation should be considered. Harishankay  Bagla v. The State of Madhya Pradesh, [1955]  1 S. C. R. 288 and The Edward Mills Co. Ltd., Beawar v.  State of Ajmer [1955] 1 S.C.R. 735, referred to. The  preamble  and the material provisions of the  Act  show that  it seeks to improve the economic and social  condition of the peasants and with that end in view fixes maximum rent payable  by the tenants and provides a speedy machinery  for fixation  of  reasonable rent.  This being  the  legislative policy and regard being had to the specific provisions  laid down by s. 12(3) of the Act for determining reasonable rent, it  is  impossible to hold that the power delegated  to  the Provincial  Government by s. 6(2) was vitiated by  excessive delegation.  The fact that no minimum was prescribed by  the section could not alter the position. Held,  further,  that  since the Act itself  is  within  the protection of Art. 31-B of the Constitution and there can be no question as to the validity of s. 6(2), the  notification issued  in exercise of the power conferred by  that  section cannot   be  challenged  as  infringing  Art.  31   of   the Constitution. Nor  was  it correct to say that the power delegated  by  s. 6(2) could be used only once and no more. Per Subba Rao, J.-The essential legislative function is  the determination of the legislative policy and its  formulation as  a  rule of conduct.  Obviously  the  legislature  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.  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 343 either in whole or in part is beyond the permissible  limits

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of  delegation.   It  is  for a Court to  hold  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. In  re  The  Delhi  Laws  Act,  1912,  [1951]  S.C.R.   747, Rajnarain,  Singh  v.  The  Chairman,  Patna  Administration Committee,  Patna, [1955] 1 S. C. R. 290, Harishankay  Bagla v.  The State of Madhya Pradesh, [1955] 1 S. C. R. 380,  The Edward Mills Co., Ltd., Beaway v. The State of Ajmer, [1955] 1  S.  C. R. 735 and Hamdard Dawakhana v.  Union  of  India, [1960] 2 S.C.R. 671, referred to. The  whole  scheme of the Bombay  Tenancy  and  Agricultural Lands  Act,  1948 (LXVII of 1948), excluding s. 6(2),  is  a self  contained and integrated one.  The  legislature  fixes the  maximum  rent  linked with crop having  regard  to  the nature  of  the land, and the other  provisions  enable  the appropriate  authorities to fix reasonable rent  subject  to that maximum.  But under s. 6(2) the legislature in clearest terms  abdicated  its essential functions in favour  of  the executive authority without laying down any standard for its guidance.  In effect it permitted the Government to amend s. 6(1)  of the Act.  While s. 6(1) overrides other  provisions of the Act, s. 6(2) derogates from s. 6(1) itself.   Section 6(2)  is capable of being exercised in such a way  that  the object  of  s. 6(1) is itself frustrated.  Section  6(1)  in effect  is  made  subject to s. 6(2).  This  is  clearly  an abdication  by the legislature of its essential  legislative function and the delegation must be held void. It  was not correct to say that the factors specified by  s. 12(3) afforded a standard ’for fixing the maximum rent.   It was not permissible to read them into s. 6(2) of the Act. No legislature can be legally permitted to lay down a  broad policy  in general terms and confer arbitrary powers on  the executive for carrying it out.  Such a law must obviously be contrary to the decisions of this Court and cannot be valid.

JUDGMENT: CIVIL  APPELLATE JURISDICTION: Civil Appeals Nos. 147 &  148 of 1955. Appeals  from  the judgment and order  dated  September  30, 1953,  of  the  former Bombay High Court  in  Special  Civil Applications Nos. 1008 and 1611 of 1953. V.   M.  Limaye, Mrs. E. Udayaratnam and S. S.  Shukla,  for the appellants (in both the appeals). H.   N.  Sanyal, Additional Solicitor-General of  India,  B. Ganapathy  Iyer,  K.  L. Hathi and R.  H.  Dhebar,  for  the respondent. 344 1960.   August  25.  The Judgment of Sinha,  C.  J.,  Kapur, Gajendragadkar   and   Wanchoo,  JJ.,   was   delivered   by Gajendragadkar,  J.  Subba  Rao, J.,  delivered  a  separate judgment. GAJENDRAGADKAR  J.-The appellants in these two  appeals  had filed   two  separate  petitions  under  Art.  226  of   the Constitution  in  the Bombay High Court in  which  they  had challenged  the vires of s. 6(2) of the Bombay  Tenancy  and Agricultural  Lands  Act, 1948 (LXVII  of  1948)  (hereafter called the Act) and the validity of the notification  issued by the Government on     October   17,   1952,   under   the provisions of the said s.     6(2).  It appears that on June

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23, 1949, in exercise of the powers conferred by s. 6(2)  of the  Act, the Government had issued a notification fixing  " in the case of an irrigated land 1/5 and in the case of  any other  land  1/4 of the crops of such land or its  value  as determined  in  the prescribed manner as  the  maximum  rent payable  by  the tenants of the lands situate in  the  areas specified  in the schedule appended thereto ".  Amongst  the areas  thus specified was the area in which the  appellants’ lands  are situated.  Subsequently, on October 17, 1952,  by virtue  of the same powers and in supersession of all  other earlier  notifications issued in that behalf the  Government purported  to prescribe a rate as the lower rate of  maximum rent  at which the rent shall be payable by the  tenants  in respect  of  the  lands situate in the  areas  specified  in Schedule I appended to it. It is unnecessary to set out  the rates thus prescribed ; it would be enough to state that the rate of maximum rent prescribed by this notification is very much lower than the rate which had been fixed by the earlier one.  By their petitions filed in the Bombay High Court  the appellants contended that s. 6(2) was ultra vires, and  that even if s. 6(2) was valid the impugned notification was  in- valid.  Accordingly they prayed for a writ of mandamus or  a writ  in  the nature of mandamus or  any  other  appropriate direction or order against the Government, the Mamlatdar  of the area concerned and their respective tenants  prohibiting them  or  any  one of them from giving effect  to  the  said notification. 345 They  also  claimed a direction or order  to  the  opponents directing   them   to  cancel  or  withdraw   the   impugned notification.   These two petitions were heard by  the  High Court  along with other companion matters in which the  same points  were  raised,  and  in the  result  the  High  Court dismissed  the  petitions.  It held that s. 6(2)  was  intra vires  and the impugned  notification was  legal  and valid. The  appellants then applied for and obtained a  certificate from  the  High Court, and it is with the  said  certificate that they have come to this Court by their two appeals. At  the outset it may be relevant to state that,  subsequent to  the  decision  under appeal, in 1956 the  Act  has  been substantially  amended and now s. 8 of the new Act  provides for  the rent and its maximum and minimum.   Shortly  stated this  section  incorporates the provisions of  the  impugned notification and adds to it the further provision that in no case  shall the rent be less than twice the assessment.   In consequence  the  point raised in the  present  appeals  has ceased to be of any importance ; at best it may affect  just a  few  cases  between landlords and  tenants  that  may  be pending in respect of the rent payable by the latter to  the former  for  a period prior to 1956.  At the time  when  the certificate   was  granted  the  questions  raised  by   the appellants were undoubtedly of general importance. We would first read s. 6 of the Act.  Section 6(1)  provides that  notwithstanding any agreement, usage, decree or  order of  a court or any law the maximum rent payable by a  tenant for  the  lease  of any land shall not in  the  case  of  an irrigated  land  exceed one fourth and in the  case  of  any other land exceed one third of the crop of such land or  its value as determined in the prescribed manner.  Section  6(2) provides that the Provincial Government may by  notification in the official gazette fix a lower rate of the maximum rent payable  by the tenants of lands situate in  any  particular area or may fix such rate on any other suitable basis as  it thinks  fit.   For the appellants Mr. Limaye  has  contended that s. 6(2) suffers from the vice of excessive  delegation.

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His argument is that 346 the   power  delegated  to  the  Provincial  Government   is unfettered and uncanalised and no guidance has been afforded to it for exercising the said power.  He has also relied  on the fact that while giving such wide powers to the  delegate in fixing the lower rate of the maximum rent the Legislature has not prescribed any  minimum as it should have done.  The High Court has held that the delegation involved in s.  6(2) is  within permissible limits and as such the  challenge  to the vires of the said provision cannot succeed. It  is now well-established by the decisions of  this  Court that the power of delegation is a constituent element of the legislative power as a whole, and that in modern times  when the  Legislatures  enact laws to meet the challenge  of  the complex   socioeconomic   problems,  they  often   find   it convenient and necessary to delegate subsidiary or ancillary powers  to  delegates of their choice for carrying  out  the policy  laid down by their Acts.  The extent to  which  such delegation  is  permissible is also now  well-settled.   The Legislature   cannot  delegate  its  essential   legislative function  in  any case.  It must lay  down  the  legislative policy and principle, and must afford guidance for  carrying out  the  said  policy before it  delegates  its  subsidiary powers  in  that behalf.  As has been observed  by  Mahajan, C.J.,  in Harishankar Bagla v. The State of  Madhya  Pradesh (1) "the Legislature cannot delegate its function of  laying down  legislative  policy in respect of a  measure  and  its formulation  as  a rule of conduct.   The  Legislature  must declare the policy of the law and the legal principles which are to control any given cases, and must provide a  standard to  guide the officials or the body in power to execute  the law  ".  In dealing with the challenge to the vires  of  any statute  on  the  ground  of  excessive  delegation  it  is, therefore,   necessary  to  enquire  whether  the   impugned delegation   involves   the  delegation  of   an   essential legislative  function or power and whether  the  Legislature has  enunciated its policy and principle and given  guidance to the delegate or not.  As the decision in Bagla’s  case(1) shows, in applying this test this Court has taken into (1)  [1955] 1 S.C.R. 381, 388.                             347 account  the statements in the preamble to the Act,  and  if the said statements afford a satisfactory basis for  holding that   the  legislative  policy  and  principle   has   been enunciated with sufficient accuracy and clarity the preamble itself  has  been held to satisfy the  requirements  of  the relevant  tests.   In every case it would  be  necessary  to consider  the relevant provisions of the Act in relation  to the  delegation  made  and the question as  to  whether  the delegation is intra vires or not will have to be decided  by the application of the relevant tests. In this connection we may also refer to the decision of this Court in The Edward Mills Co. Ltd., Beawar v. State of Ajmer (1), where the validity of the notification issued under the provisions  of  the  Minimum  Wages  Act  XI  of  1948   was impeached, and the said challenge raised the question  about the validity of the delegation provided for by s. 27 of  the said  Act.   The scheme of the Act was that a  schedule  had been  attached  to it which gave a list of  employments  to. which  the provisions of the Act applied an s. 7 gave  power to  the appropriate Government to add to either part of  the schedule  any  employment  in respect of  which  it  was  of opinion  that the minimum wages shall be fixed and this  the

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appropriate  Government  was  authorised  to  do  by  giving notification  in a broad manner, and thereupon the  schedule shall,  in  its application to the State, be  deemed  to  be amended  accordingly.  The  argument was that  the  Act  had nowhere  formulated a legislative policy according to  which an  employment  should be chosen for being included  in  the schedule; no principles had been prescribed and no standards laid  down  in  that  behalf,  and  so  the  delegation  was unfettered  and uncanalised.  This argument was rejected  by this  Court on the broad consideration that the  legislative policy  was apparent on the face of the Act itself.  "  What the Act aims at ", observed Mukherjea, J., as he then was, " is  the statutory fixation of minimum wages with a  view  to obviate the chance of exploitation of labour. (1)  [1955] 1 S.C.R. 735,750. 45 348 The  Legislature undoubtedly intended to apply this Act  not to  all  industries but to those industries  only  where  by reason of unorganised labour or want of proper  arrangements for  effective regulation of wages or for other  causes  the wages of labourers in a particular industry were very low ". The learned Judge then pointed out that conditions of labour vary under  different circumstances and from State to State, and  the  expediency  of including  a  particular  trade  or industry within the schedule depends upon a variety of facts which  are not uniform and which can best be ascertained  by the  person who is placed in charge of administration  of  a particular  State.   It  is with a view  to  carry  out  the particular purpose of the Act that power is delegated to the appropriate Government by s. 27.  That is how the  challenge to the vires of s. 27 was repelled. The present Act is undoubtedly a beneficent measure.  It has enacted provisions for agrarian reform which the Legislature thought was overdue.  The preamble shows that the object  of the Act, inter alia, was to improve the economic and  social condition of peasants and ensure the full and efficient  use of land for agriculture.  With that object the Act has  made several  provisions  to  safeguard  the  interests  of   the tenants.  Let us consider some of these provisions.  Section 6 which we have already set out prescribes the maximum  rent payable  by a tenant, and provides for the reduction of  the said  maximum by reference to particular areas.   Section  7 lays down that the rent payable by tenants shall, subject to the  maximum  rate  fixed under s. 6,  be  the  rent  agreed between  the parties, or in the absence of any agreement  or usage,   or  where  there  is  a  dispute  as  regards   the reasonableness   of  the  rent  payable  according  to   the agreement  or usage, the reasonable rent.  It is thus  clear that  even  in regard to an agreed rent or a rent  fixed  by usage, if a tenant raises a dispute about its reasonableness that  dispute has to be settled in the manner prescribed  by the  Act  and  the amount  of  reasonable  rent  determined. Section  8 provides for commutation of crop-share rent  into cash.   Section 9 prohibits a landlord from  receiving  from his tenant any rent in terms of service or 349 labour;  and it requires him to apply to the  Mamlatdar  for commuting  such  rent into cash.  Section  10  provides  for refund  of  excess rent recovered by the landlord  from  his tenant.   Section 11 prohibits the recovery by the  landlord of  any  cess,  rate, vero, huk or tax  or  service  of  any description from the tenant other than the rent lawfully due from such land.  Section 12 provides for enquiries in regard to the fixation of reasonable rent.  On an application  made

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by  the tenant or the landlord in that behalf the  Mamlatdar has  to determine the reasonable rent under s. 12(3)  having regard  to  the factors specified in the  said  sub-section. These  factors are (a) the rental values of lands  used  for similar  purposes  in  the  locality,  (b)  the  profits  of agriculture of similar lands in the locality, (c) the prices of   crops  and  commodities  in  the  locality,   (d)   the improvements made in the land by the landlord or the tenant, (e)  the assessment payable in respect of the land, and  (f) such other factors as may be prescribed.  There is no  doubt that  the last clause which refers to other factors must  be construed as referring to factors ejusdem generis with those that  have been previously enumerated.  Section 13  provides for the suspension or remission of rent, and the  conditions under which the said remission or suspension can be granted. It  would thus be seen that the material provisions  of  the Act  aim  at  giving relief to the  tenants  by  fixing  the maximum  rent payable by them and by providing for a  speedy machinery   to   consider   their   complaints   about   the unreasonableness  of  the rent claimed from  them  by  their respective landlords.  It is in the light of this policy  of the Act which is writ large on the face of these  provisions that  we  have to consider the question as  to  whether  the delegation  made  by s. 6(2) suffers from the  infirmity  of excessive delegation. Broadly stated s. 6(2) seeks to provide for the fixation  of a  lower  rate of maximum rent area-wise.  We  have  already seen  that individual tenants are given the right  to  apply for  the fixation of reasonable rent by s. 12, and  specific factors  have  been  specified  which  the  Mamlatdar   must consider  in  fixing  a reasonable  rent.   The  Legislature realised that a large number of 350 tenants  in the State were poor, ignorant and in many  cases helpless,  and it was thought that many of them may  not  be able  to make individual applications for the fixation of  a reasonable  rent  under s. 12.  That is why it  was  thought necessary to confer upon the Provincial Government the power to  fix a lower rate of the maximum rent payable by  tenants in  respect of  particular areas.  In a sense what could  be done by the Mamlatdar in individual cases can be achieved by the  Provincial Government in respect of a large  number  of cases  covered  in a particular area.  If that  be  so,  the legislative  policy  having been clearly  expressed  in  the relevant   provisions  and  the  factors   for   determining reasonable  rent also having been specified in s. 12(3),  it is  difficult  to accept the argument  that  the  Provincial Government  has been given uncanalised or unfettered  powers by  s. 6(2) to do what it likes without any  guidance.   The relevant factors having been specified by s. 12(3) when  the Provincial  Government  considers the question of  fixing  a lower  rate  of the maximum rent payable in  any  particular area  it is expected to adopt a basis which is  suitable  to that   particular   area.   The   relevant   conditions   of agriculture would not be uniform in different areas and  the problem  of  fixing a reduced maximum rent  payable  in  the respective  areas would have to be tackled in the  light  of the  special features and conditions of that area ; that  is why  a  certain  amount of latitude had to be  left  to  the Government  in fixing the lower rate of the maximum rent  in the respective areas, and that is intended to be achieved by giving  it  liberty  to adopt a basis  which  it  thinks  is suitable for the area in question.  The word " suitable " in the context must mean I suitable to the area’ having  regard to  the other provisions of the Act such as s. 6(1)  and  s.

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12.   It  is true that the power to fix  a  reasonable  rent conferred  on  the Mamlatdar under s. 12 is subject  to  the power  of the Provincial Government under s. 6(2).  Even  so we  think  it would be difficult to hold  that  the  factors prescribed  for the guidance of the Mamlatdar would have  no relevance at all when the Provincial Government acts under                             351 s.   6(2).  In our opinion, therefore, having regard to  the legislative policy laid down by the Act in its preamble  and in  the other relevant sections to which we  have  referred, and  having regard to the guidance which has  been  provided for fixing a reasonable rent under s. 12(3), it would not be possible to hold that the power delegated to the  Provincial Government  by  s.  6(2)  suffers  from  the  infirmity   of excessive  delegation  The  fact that no  minimum  has  been prescribed would not materially affect this position. Mr. Limaye has then contended that even if s. 6(2) is  valid the  impugned  notification is invalid  because  it  offends against  Art. 31 of the Constitution.  He concedes that  the Act  itself is saved under Art. 31B since it is one  of  the Acts  enumerated in the Ninth Schedule; but his argument  is that   the  notification  has  in  substance   amended   the provisions  of  s.  6(1)  and thus it  amounts  to  a  fresh legislation  to which Art. 31B cannot apply.  There  is  no, substance  in this argument.  If s. 6(2) is valid  then  the exercise  of the power validly conferred on  the  Provincial Government  cannot  be treated as  fresh  legislation  which offends against Art. 31.  If the Act is saved by Art. 31B s. 6(2) is also saved, and the power must be held to be validly conferred  on the Provincial Government, and a  notification issued by virtue of the said powers cannot be challenged  on the ground that it violates Art. 31. The  next  argument  is that  the  notification  is  invalid because  the power to issue a notification conferred  by  s. 6(2)  was  exhausted as soon as the  Government  issued  the first notification on June 23, 1949.  This argument proceeds on the assumption that the power conferred on the Government by  s.  6(2)  can be exercised only once, and  it  seeks  to derive  support from the fact that the words " from time  to time  " which were used in the corresponding section of  the earlier tenancy legislation in the State have not been  used in  s. 6(2).  Reliance is also placed on the fact  that  the said  words  have  been used in s. 8(1)  of  the  Act.   The omission  of the said words from s. 6(2) as contrasted  with their inclusion in s. 8(1), says Mr. Limaye, indicates  that the power delegated under s. 6(2) was 352 intended to be used only once.  This argument is fallacious. Why  the  Legislature did not use the words " from  time  to time " in s. 6(2) when it used them in s.    8(1)   it    is difficult to understand ; but in Construing s.    6(2) it is obviously necessary to apply the provisions of s. 14 of  the Bombay  General  Clauses Act 1904 (1 of 1904).   Section  14 provides  that  where  by  any Bombay  Act  made  after  the commencement  of  this  Act any power is  conferred  on  any Government  then that power may be exercised from.  time  to time as occasion requires.  Quite clearly if s. 6(2) is read in  the light of s. 14 of the Bombay General Clauses Act  it must  follow that the power to issue a notification  can  be exercised  from  time to time as occasion requires.   It  is true  that  s.  14 of the General Clauses Act,  1897  (X  of 1897),  provides  that where any power is conferred  by  any Central Act or Regulation then, unless a different intention appears,  that power may be exercised from time to  time  as occasion  requires.  Since there is a specific provision  of

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the  Bombay General Clauses Act relevant on the point it  is unnecessary to take recourse to s. 14 of the Central General Clauses  Act ; but even if we were to assume that the  power in  question  can be exercised from time to  time  unless  a different  intention appears we would feel no difficulty  in holding  that no such different intention can be  attributed to  the Legislature when it enacted s. 6(2).  It is  obvious that  having  prescribed  for  a maximum.  by  s.  6(1)  the Legislature has deliberately provided for a modification  of the  said  maximum  rent  and that  itself  shows  that  the fixation  of any maximum rent was not treated as  immutable. If it was necessary to issue one notification under s.  6(2) it   would   follow  by  force  of  the  same   logic   that circumstances   may   require  the  issue   of   a   further notification.   The  fixation of agricultural  rent  depends upon  so many uncertain factors which may vary from time  to time  and  from  place to place that it  would  be  idle  to contend that the Legislature wanted to fix the maximum  only once,  or,  as Mr. Limaye concedes,  twice.   Therefore  the argument  that  the power to issue a notification  has  been exhausted cannot be sustained.                             353 The  last  argument which Mr. Limaye  faintly  attempted  to place  before  us was that the expression "  any  particular area"  would  not be applicable to the areas  in  which  the appellants’  lands are situated because, according  to  him, the expression should be construed in the light of the  same expression  used in s. 298(2)(a) of the Government of  India Act,  1935.   This argument is far fetched and  fatuous  and need not  be considered. In the result the appeals fail and are dismissed with costs. SUBBARAO  J.-I  have  had  the  advantage  of  perusing  the judgment   prepared  by  Gajendragadkar,  J.  I  regret   my inability  to agree with my learned brother on the  question of  the  vires  of  s.  6(2)  of  the  Bombay  Tenancy   and Agricultural  Lands Act, 1948 (LXVII of  1948)  (hereinafter called the Act). The  facts  have  been fully stated in the  judgment  of  my learned brother and I need not restate them here.  It  would be enough if I expressed my opinion on the said question. Learned   counsel  for  the  appellants  attacks  the   con- stitutional validity of s. 6(2) on the ground that the  said subsection  exceeds  the  limits  of  permissible  delegated legislation.  Before considering the validity of s. 6(2), it would  be convenient to notice briefly the relevant  aspects of the law of the doctrine of delegated legislation. The  scope of the doctrine of delegation of legislation  has been so authoritatively laid down by this Court in more than one  decision  that  it  would be  pedantic  to  attempt  to resurvey  the  field  over again.  I  would,  therefore,  be content to collate the relevant passages from the  decisions of  this-Court  to ascertain the  principle  underlying  the doctrine. The leading decision on this subject is In re The Delhi Laws Act, 1912 (1).  There the Central Legislature had  empowered the  executive  authority under its legislative  control  to apply  at its discretion the laws to an area which was  also under  the legislative sway of the Centre.  The validity  of the laws was questioned (1)  [1951] S.C.R. 747. 354 on the ground that the legislature bad no power to  delegate legislative  powers  to executive authorities.  As  many  as seven  Judges  dealt  with  the  question  and  wrote  seven separate  judgments  considering elaborately  the  different

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aspects  of the question raised.  I am relieved of the  duty to ascertain the core of the decision as that has been  done by  Bose,  J.,  with  clarity  in  Rajnarain  Singh  v.  The Chairman, Patna Administration Committee, Patna (1).   Bose, J., after pointing out the seven variations of the authority given  to  the  executive in the Delhi Laws  Act  Case  (2), summarized  the majority view on the relevant aspect of  the question now raised at p. 301 thus: "  In our opinion, the majority view was that  an  executive authority  can  be authorised 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, and there was some divergence of view  about this  in  the former case, but this much is clear  from  the opinions  set  out  above: it cannot  include  a  change  of policy." Rajnarain  Singh’s Case (1) dealt with s. 3(1) of the  Patna Administration  Act, 1915, (Bihar and Orissa Act 1 of  1915) as  amended  by Patna Administration (Amendment)  Act,  1928 (Bihar  and Orissa Act IV of 1928) and with  a  notification issued  by the Governor of Bihar picking out s. 194  out  of the Bihar and Orissa Municipal Act of 1922, modifying it and extending   it   in   its  modified  form   to   the   Patna Administration  and  Patna Village areas.  Bose,  J.,  after pointing  out the difference between Rajnarain Singh’s  Case (1) and the Delhi Laws Act Case (2) observed at p. 303 thus: "  But  even  as the modification of  the  whole  cannot  be permitted  to effect any essential change in the Act  or  an alteration  in its policy, so also a modification of a  part cannot be permitted to do that either." This Court again in Harishankar Bagla v. The State of Madhya Pradesh (3) considered the scope of the Delhi Laws Act  Case (2).  Mahajan, C. J., stated at p. 388 thus. (1) [1955] 1 S.C.R. 290.       (2) [1951] S.C.R. 747. (3)  [1955] 1 S.C.R. 380.                             355 " It was settled by the majority judgment in the Delhi  Laws Act Case (1) that essential powers of legislation cannot  be delegated.  In other words, the legislature cannot  delegate its function of laying down legislative policy in respect of a  measure  and its formulation as a rule of  conduct.   The Legislature must declare the policy of the law and the legal principles  which  are to control any given cases  and  must provide  a  standard to guide the officials or the  body  in power  to  execute  the  law.   The  essential   legislative function  consists  in the determination or  choice  of  the legislative policy and of formally enacting that policy into a binding rule of conduct." In The Edward Mills Co., Ltd., Beawar v. The State of  Ajmer (2),  Mukherjea, J., as he then was, speaking for the  Court stated the principle thus at p. 749: "  A  Legislature  cannot  certainly  strip  itself  of  its essential  functions  and  vest the same  on  an  extraneous authority.   The  primary  duty  of law  making  has  to  be discharged  by the Legislature itself but delegation may  be resorted to as a subsidiary or an ancillary measure." The  latest  decision  on  the  point  is  that  in  Hamdard Dawakhana  v.  Union  of India (3).  One  of  the  questions raised  in that case was whether s. 3(d) of Drugs and  Magic Remedies (Objectionable Advertisements) Act, 1954,  exceeded the  permissible  limits  of  delegated  legislation.    The principle has been restated by Kapur, J., at p. 566 thus: , "This means that the legislature having laid down the  broad principles  of its policy in the legislation can then  leave the details to be supplied by the administrative  authority.

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In  other  words  by  delegated  legislation  the   delegate completes  the legislation by supplying details  within  the limits  prescribed  by  the  statute  and  in  the  case  of conditional   legislation  the  power  of   legislation   is exercised  by the legislature conditionally leaving  to  the discretion of an external (1) [1951] S.C.R. 747. (2) [1955] 1 S.C.R. 735. (3)  [1960] 2 S.C.R. 671. 46 356 authority  the time and manner of carrying  its  legislation into  effect as also the determination of the area to  which it is to extend." Applying  the  principle  to the facts  of  that  case,  the learned Judge observed at p. 568 thus: " In our view the words impugned are vague. ;Parliament  has established no criteria, no standards and has not prescribed any principle on which a particular disease or condition  is to  be  specified in the Schedule.  It is  not  stated  what facts or circumstances are to be taken into consideration to include  a  particular condition or disease.  The  power  of specifying diseases and conditions as given in s. 3(d)  must therefore be held to be going beyond permissible  boundaries of valid delegation. It  is  not  necessary  to multiply  decisions;  nor  is  it necessary  to  point  out  the  subtle  distinction  between delegates legislation and conditional legislation.  The  law on the subject may be briefly stated thus: 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.  Obviously 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 overburdened 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 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 hold on a fair, generous 357 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 this Court  to strike  down  without any’ hesitation  any  arbitrary  power conferred on the executive by the legislature. Bearing  the aforesaid principles in mind, I shall  look  at the provisions of the Act to ascertain whether s. 6(2) is in conformity  with the law laid down by this Court.   I  shall for  the  present  ignore s. 6(2) and  briefly  and  broadly notice  the scheme of the Act.  The preamble shows that  the

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object  of  the Act was mainly to improve the  economic  and social  conditions  of peasants and to ensure the  full  and efficient  use of land for agriculture.  It  also  indicates that the Act was not intended to be a confiscatory one,  but was  enacted to regulate the relationship between  land-lord and  tenant, particularly in respect of rent payable by  the tenant  to  the land-lord.  In s. 6(1)  the  legislature  in clear  terms  fixes the maximum rent payable  by  a  tenant, having  regard  to the nature of the land: in  the  case  of irrigated land it fixes one-fourth and in the case of  other land  one-third  of the crop of such land or  its  value  as determined  in  the prescribed manner as the  maximum  rent. The  rest  of  the Act is to be worked out  subject  to  the maximum  rent  fixed under s. 6(1).  Section 7  enables  the land-lord  and  tenant  to  agree upon  the  rate  of  rent. Section 8 gives power to the Provincial Government to  issue notifications  providing for the commutation of the rent  in kind into cash rent.  It also, if no rate of commutation has been so fixed by the State Government, enables the Mamlatdar to  fix the amount of commutation in the manner  prescribed. Sub-section (3) of s. 6 prohibits a landlord from recovering any  rent by way of crop-share or in excess of the  commuted cash rent.  Section 9 compels the land-lord to apply to  the Mamlatdar,  if  the  land-lord is receiving  rent  from  any tenant  in  terms of service or labour, for  commuting  such rent into 358 cash.    Section  10  makes  the  landlord  liable  to   pay compensation to the tenant if he contravenes the  provisions of ss. 6, 7, 8 or 9. Section 11 prohibits the land-lord from collecting  any cesses other than the rent lawfully  payable in  respect of the land.  Section 12 enables the  tenant  to apply  to the Mamlatdar for the fixation of reasonable  rent in  respect of the land in his possession and s. 12(3)  lays down   the   factors  the  Mamlatdar  has   to   take   into consideration in fixing a reasonable rent.  After fixing the rent,  the Mamlatdar makes an order for Payment of the  rent to the land-lord and the rent so fixed shall hold good for a period  of  five  years.   There is  also  a  provision  for reduction  of rent, if during the said period on account  of deterioration  of the land by floods or other causes  beyond the  control  of  the tenant the land  has  been  wholly  or partially  rendered  unfit  for  cultivation.   Section   13 enjoins  on  the  land-lord to suspend  or  remit  the  rent payable by the tenant to him if the payment of land  revenue by him to the Government is suspended or remitted.  A  right of appeal is provided against the order of the Mamlatdar  to the  Collector.  Shortly stated, this Act provides  for  the fixation  of  maximum rent by the Government,  a  reasonable rent  by Mamlatdar and an agreed rent by the  parties.   But both  the agreed rent and the reasonable rent cannot  exceed the   maximum  rent.   There  are  express  provisions   for reduction or remission of rent in appropriate circumstances. The  Act does not provide for an appeal or revision  to  the Government and the Government has, therefore, no say in  the matter of fixation of reasonable rent.  The whole scheme  of the  Act, therefore, excluding s. 6(2), is a  self-contained and integrated one.  The legislature fixes the maximum  rent linked  with crop having regard to the nature of  the  land, and the other provisions enable the appropriate  authorities to fix reasonable rent subject to that maximum. Now let us see the impact of s. 6(2) on this scheme. Section 6(2) reads : "  The  Provincial Government may, by  notification  in  the Official Gazette, fix a lower rate of the

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359 maximum rent payable by the tenants of lands situate in  any particular  area or may fix such rate on any other  suitable basis as it thinks fit." Under this section the Provincial Government may fix a lower rate  of the maximum in any particular area or to  fix  such rate  on any other suitable basis.  Three elastic words  are used in s. 6(2), namely, (1) lower rate; (2) particular area ;  and (3) on any other suitable basis.  Prima facie  in  s. 6(2)  the  legislature has not laid down any policy  or  any standard  to enable the Provincial Government to reduce  the maximum rent fixed under s. 6(1).  What is the limit of  the lower rate the Government is empowered to fix ? What is  the extent of the area with reference to which that rate can  be fixed?   What are the conditions prevailing in a  particular area which require the reduction of the maximum rent ?  Even if  there  are conditions justifiable for reduction  of  the maximum  rent,  what is the basis for that reduction  ?  The disjunctive  "  or " between " particular area " and  "  may fix"  and  the word ,other" qualifying "  suitable  basis  " indicate  that  the situation of ’the land in  a  particular area  may  also  be a basis for fixing a  lower  rent.   The situation  of a land in a particular area cannot  in  itself afford a basis for fixing a specified rate of maximum  rent. The words " suitable basis " in the alternative clause is so vague that in effect and substance they confer absolute  and arbitrary discretion on the Provincial Government.  What  is the standard of suitability ? The standard of suitability is only  what the Government thinks suitable.  In this  section the  legislature in clearest terms abdicated  its  essential functions  in  favour  of the  executive  authority  without laying  down  any standard for its guidance.  In  effect  it permitted  the Government to amend s. 6(1) of the  Act.   To illustrate,  the legislature fixes the maximum rent  payable by  a  tenant  to his landlord at  X;  the  Mamlatdar  after enquiry fixes Y as reasonable rent which is less than X; the Government in exercise of the power conferred under s.  6(2) can arbitrarily fix Z which is far less than the  reasonable rent; with the result that the entire scheme 360 promulgated by the legislature breaks.  The Government  also may  select  any small area containing a few  landlords  and reduce the maximum rent to the lowest level with the  result the Act can be worked out as an expropriatory measure  which is  contrary to the intention of the  legislature.   Learned counsel for the respondents realising that arbitrariness  is writ  large on the face of s. 6(2) attempted to  evolve  the legislative  formula  from the preamble to s.  6(1)  and  s. 12(3)  of  the  Act.  I cannot find any  indication  of  the legislative  policy in the manner of fixation of  the  lower rate  of maximum rent in the preamble.  Nor can  I  discover any  such  in  s.  6(1).   Section  6(1)  contains  a  clear legislative  policy  in fixing the maximum rent  on  certain identifiable  basis.  The legislature says in effect  in  s. 6(2),  "  I  have  fixed the  maximum  rent  in  respect  of irrigated  lands and other lands on the basis of a  definite share  of  the crop of such lands, but you can  reduce  that maximum  rent  on  any  basis you  like  ".  While  s.  6(1) overrides  other  provisions of the Act, s.  6(2)  derogates from  s.  6(1)  itself  Section 6(2)  is  capable  of  being exercised in such a way that the object of s. 6(1) is itself frustrated.   Section 6(1) in effect is made subject  to  s. 6(2). Now  coming  to s. 12(3), it is contended that  the  factors mentioned  in s. 12(3) afford a standard for the  Government

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for  fixing  the maximum rent.  To put  it  differently  the suitable  basis is one or other of the factors in s.  12(3). The  Act does not say so, either expressly or  by  necessary implication.   The criteria for fixing rent in s. 13 are  to afford  a  guide to Mamlatdar for  fixing  reasonable  rent. Indeed the sub-clause is subject to s. 6 indicating  thereby that  the  maximum rent fixed by the Government is  not  the same as the reasonable rent.  Indeed if the reasonable  rent determined on the basis of all or some of the factors in  s. 12(3) is more than the maximum rent fixed by the  Government on  a suitable basis, the latter prevails over  the  former. As the maximum rent supersedes reasonable rent, the  factors governing  reasonable rent need not necessarily  govern  the fixation of maximum rent.  To attempt to read the factors in s. 12(3) into 361 s.   6(2)  is,  in  my view, not  permissible.   On  a  fair reading of the provisions of the Act, I find it not possible to  discover  any standard laid down by the  legislature  to enable the Provincial Government to fix a lower rate of  the maximum  rent.  The section conferring such arbitrary  power on  the  Provincial  Government  without  laying  down   any legislative standard is in excess of the permissible  limits of delegation. The  learned Additional Solicitor-General broadly  contended that the policy of the legislature is to prevent rackrenting and to fix a reasonable rent and, therefore, any exercise of the  power under s. 6(2) is guided by that policy.  This  is an   extreme  contention  and,  if  accepted,  will   enable Parliament and legislatures to confer absolute and  unguided powers  on the executive.  If a legislature can  legally  be permitted  to lay down a broad policy in general  terms  and confer  arbitrary  powers on the executive for  carrying  it out,  there  will be an end of the doctrine of the  rule  of law.  If the contention be correct., the legislature in  the present  case  could have stated in the preamble  that  they were  making the law for fixing the maximum rent  and  could have  conferred an absolute power on the Government  to  fix suitable  rents having regard to the circumstances  of  each case.   Such  a  law cannot obviously be  valid.   When  the decisions  say  that  the legislature  shall  lay  down  the legislative policy and its formulation as a rule of conduct, they  do not mean vague and general declaration  of  policy, but a definite policy controlling and regulating the  powers conferred on the executive for carrying into effect that policy. I  must,  therefore, hold that s. 6(2) of the  Act  is  void inasmuch   as   it  exceeded  the  permissible   limits   of legislative  delegation.  In  the  result  the  appeals  are allowed with costs. BY COURT: In view of the majority judgment, the appeals  are dismissed with costs.                    _____________________ 362