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TMI Blog1991 (7) TMI 203X X X X Extracts X X X X X X X X Extracts X X X X ..... decided by us cover all the points at issue in the pending writ petitions. We have allowed Advocates appearing in these other writ petitions also to address us on the various common questions of law which arises in these writ petitions. Accordingly we have had the benefit of listening to the able arguments of Dr. D.V. Chandrachud and Mr. S.A. Divan along with the learned Advocates appearing in these three writ petitions. 2. An affidavit in reply has been filed by the Union of India in Writ Petition No. 1810 of 1990, Learned Advocate-General appearing for the Union of India in all these matters, has stated that the affidavit in reply filed in Writ Petition No. 1810 of 1990 should be treated as a common affidavit in reply in all the writ petitions which are before us challenging these inspection and supervisory fees. None of the petitioners have any objection to this. We have, therefore, acceded to this request. 3. The petitioners in Writ Petition No. 1810 of 1990 and 30 of 1990 have imported timber logs while the petitioner in Writ Petition No. 1483 of 1991 has imported pulses. The first contention which is raised before us by the petitioners is that timber logs and pulses do n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roots, cuttings, all types of grafts and/or vegetatively propogated material utilised for sowing, planting or consumption;". 6. The Oxford English Dictionary defines Pulse as The edible seeds of leguminous plants cultivated for food, as peas, beans, lentils etc., (italics ours). Pulses are clearly seeds of agricultural or horticultural crops within the meaning of Clause 2(1) of the said order. 7. We have therefore to examine whether the Central Government has the authority to levy inspection fees in exercise of its powers delegated to it under Section 3 of the Destructive Insects and Pests Act, 1914. Now, the Destructive Insects and Pests Act, 1914 does not give any express power to the Central Government to levy inspection fees. Under Section 3(1) of the said Act it is provided as follows : 3. Power of Central Government to regulate or prohibit the import of articles likely to infect. - (1) The Central Government may, by notification in the Official Gazette, prohibit or regulate, subject to such restrictions and conditions as it may impose, the import into India or any part thereof, or any specified place therein, of any article or class of articles likely to cause in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Food Controller found that there was disparity in the prices of milk prevailing in different areas. In order to equalise these prices he entered into agreements with the defendant Company by which the latter, inter alia, agreed to pay a surcharge. The House of Lords set aside the levy of this charge on the ground that though it may be a necessary levy to maintain vital supplies essential to the life of the community during the war, the Food Controller had no power to levy such a charge. The power to regulate food supply did not confer on him the power to levy a charge. It observed, The Crown in my opinion cannot here succeed except by maintaining the proposition that where statutory authority has been given to the executive to make regulations controlling acts to be done by His Majesty s subjects, or some of them, the Minister may, without express authority so to do, demand and receive money as the price of exercising his power of control in a particular way, such money to be applied to some public purpose to be determined by the Executive. The House of Lords held that the executive s power to regulate did not give it the power to demand or receive money. Relying upon th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... set out therein. For example, in List I, entry 96 deals with fees in respect of any of the matters in that list. The right to levy fees is thus not considered as a part of, or entailed in the right to legislate in respect of the relevant entry in that list. The same is the position with regard to entry 66 of List II and entry 47 of the List III. In the case of M.P.V. Sundararamier Co. v. State ofAndhra Pradesh and Another, reported in A.I.R. 1958 S.C. 468, the Supreme Court said that entry 42 of List I of the 7th Schedule which deals with inter-state trade and commerce was not to be read as including a right to levy a tax on inter-state sales, especially having regard to the scheme of the Lists of the 7th Schedule. 13. In the case of M/s. Hoechst Pharmaceutical Ltd. v. State of Bihar and Ors. reported in AIR 1983 S.C. 1019 at page 1043, the Supreme Court was again required to consider the provisions of Entry 33 of List III and the States power of taxation under Entry 54 of List II. The Supreme Court observed (Para 74): Taxation is considered to be a distinct matter for purposes of legislative competence. Hence, the power to tax cannot be deduced from a general legislative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts, that the principles enumerated above do not apply to the Destructive Insects and Pests Act, 1914 because it is a pre-constitutional law. Originally, the words Governor-General in Council were to be found in Section 3(1) of the Act in the place of Central Government , and the words Gazette of India , were to be found in the place of Official Gazette . By an amendment of 1937, these alterations have been made in the original section. At the time of its enactment in 1914, therefore, Section 3 gave power to the Governor-General in Council to regulate and prohibit the import of articles likely to infest crops. It is submitted that the Governor-General in Council at that time was a repository of both legislative and executive powers. Hence in the exercise of his powers under Section 3 he could have, by notification imposed a tax or a fee of the kind in question. According to learned Advocate General, by virtue of Article 372 of the Constitution, this power which could have been exercised by the Governor General in Council in 1914 is now vested in the Central Government. Therefore no fetters can be read into the powers of the Central Government to enact delegated legislation. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exercised within the limits of delegation. There is therefore no merit in the argument that the doctrine of ultra vires does not apply to the said Order promulgated in exercise of powers delegated under Section 3(1) of the Act. 18. It is also submitted before us by Dr. Chandrachud that if we interpret Section 3 as delegating by implication to the Central Government, the power to levy taxes and fees, there are no guidelines laid down in that section for the imposition of such taxes or fees. Section 3(1) gives no indication of the nature of taxes or fees to be levied, on what basis these taxes and fees are to be charged, and in what circumstances. In the absence of such guidelines, the delegation of the power to levy taxes and fees must be considered as wholly arbitrary and excessive. Such arbitrary conferment of delegated powers would clearly violate Article 14 of the Constitution which is a protection against arbitrary exercise of powers. On that count, the provisions of Section 3(1) would be rendered unconstitutional. He has pointed out that Article 13 of the Constitution applies even to pre-constitutional laws; much more so to an Order passed in 1989. We should not, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the executive power is a bad regulation as being violative of Article 14. An unguided delegation of power to enact subsidiary legislation would lead to arbitrariness and hence would be violative of Article 14. (See also: Pandit Banarasi Das Bhanot v. State of Madhya Pradesh - AIR 1974 S.C. 1660 at p. 1665, and Mohammad Yasin v. Town Area Committee, Jalalabad and Anr. - AIR 1952 S.C. 115 at p. 117. Section 3(1) cannot therefore be read as conferring arbitrary powers on the Central Government to frame delegated legislation. 20. It is stated by learned Advocate General in all fairness, that if we come to the conclusion that the power to regulate does not include the power to levy a tax or a fee, he has no further submissions to make. In our view, looking to the provisions of Section 3(1) of the Destructive Insects and Pests Act, 1914, the Central Government has no authority to levy inspection fees in respect of timber logs and pukes imported into India. 21. It is pointed out to us that large amounts running into lacs of rupees are being sought to be collected by way of inspection fees as for instance, in the case of the petitioner in Writ Petition No. 3809 of 1990. We need not go ..... X X X X Extracts X X X X X X X X Extracts X X X X
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