Delegated Legislation

While determining vires of delegated legislation, it must be examined whether it exceeds the authority granted by the parent statute, whether the prescribed procedure for its formulation was followed, and whether it aligns with the object of the enabling law

Rules and regulations, being forms of subordinate legislation, cannot override or contradict the principal statute

Their purpose is to elaborate on procedural details, not to alter the core provisions of the parent law

While such rules may be treated as part of the statute for practical application, they retain their subordinate character and may only be struck down if found repugnant to the purpose or established principles of the parent legislation.

Where the statute provides a detailed framework, the scope for delegated legislation is narrow; conversely, where the statute lays down general principles, broader delegation is permissible to fill in administrative and procedural details

Delegated legislation serves to ease legislative burden and respond flexibly to evolving circumstances

Underlying assumption is that while the legislature sets the policy, the Executive is empowered to work out the operational specifics.

Delegated legislation is intended to advance the purpose of primary legislation and if a rule goes beyond the rule-making power conferred by the statute or if a rule supplants any provision for which power has not been conferred it becomes invalid

So the rule is that a charge must be imposed by clear and unambiguous language in the statute itself

If there is none, then no power vests in the delegatee to do so by implication through Rules

Delegated power to make rules is circumscribed by the strict periphery of powers defined in the statute itself which cannot be exceeded to assume more powers than granted by the delegator.

Delegated legislation is secondary legislation; it is a law made by a person or body other than the legislature but with legislature's authority.

No rule can militate or render the provisions of an Act ineffective.

To strike down such legislative instrument the movant has to demonstrate that (i) the same is against the rights guaranteed by the Constitution or it is in conflict with constitutional provisions, (ii) it is beyond the competence of the delegatee or (iii) it is violative of the scope of the statute itself.

Petitioners / taxpayers assailed show cause notices issued to them for recovery of 2% extra tax levied on goods so notified in addition to tax already levied

Validity

Certain functions have been delegated by Sales Tax Act, 1990 itself which otherwise are more of procedural in nature as to the effective date and its paraphernalia regarding input adjustment and payment in lieu thereof

Levy of extra tax was not a case of excessive delegation or for that matter, delegation of any legislative functions

By way of SRO 896(I)/2013 dated 4-10-2013, an extra tax of 2% was being collected in terms of S. 3(5) of Sales Tax Act, 1990

Provision of R. 58-T (5) of Sales Tax Special Procedure Rule, 2007 also provided that the specified goods on which extra sales tax was paid in the manner so provided, would be exempted from payment of sales tax on subsequent supplies including those as made by a retailer

This was in fact never an extra tax in essence, rather a mode to facilitate trade merely by making collection of a tax which was to be paid subsequently on supplies or at retail stage

Petitioners / tax-payers were estopped by their conduct as they had been availing such facility

This was never a direct tax upon petitioners / taxpayers but was on the end consumer and was to be made part of cost of goods and value of supply for the purposes of paying sales tax under Sales Tax Act, 1990

Such levy was neither discriminatory being confiscatory in nature and did not imping upon any fundamental rights

Division Bench of High Court declined to interfere in the competence and validity of legislation in question i.e. S. 3(5) of Sales Tax Act, 1990 as well as Rr. 58-S and 58-T of Sales Tax Special Procedure Rule, 2007 introduced by way of an amending SRO 896(I)/2013 dated 4-10-2013

Division Bench of High Court declared the provision of Sales Tax Act, 1990 and SRO 896(I)/2013 dated 4-10-2013 to be validly and competently enacted / issued and were not ultra vires

Constitutional petition was dismissed in circumstances.

If a rule goes beyond the rule-making power conferred by the statute or if a rule supplants any provision for which power has not been conferred, it becomes invalid

Delegated power to legislate by making rules cannot be exercised to bring into existence substantive rights, obligations or disabilities not contemplated by the provisions of the statute.

Rules have to be consistent with the statute under which they are framed and with all that is deemed to be incorporated in the statute

Rule making authority cannot clothe itself with power which the statute itself does not give

Since the Rules are the wheels on which the hypothetical vehicle of the Act runs, it is tantamount that both work in harmony; otherwise, the Act would not be able to serve the purpose for which it was passed by the legislature.

Rules are progeny of a statute, which are made by competent authority in exercise of its delegated legislative power under such Act and application thereof is empowered, confined and limited to the law under which those are framed.

Petitioner being mother of her deceased unmarried son, who was a Government servant, invoked constitutional jurisdiction of the High Court challenging vires of R.19(3)(b) of the Punjab Government Servants Housing Foundation Rules, 2013 ('the Rules, 2013')

Plea of the petitioner was that R.19(3)(b) of the Rules, 2013 is inconsistent with the provisions of the Act of 2004, the Rules of 2005 and the Regulations of 2013

Validity

Undeniably, Rules framed under a statute are to remain within the precinct of the statute itself and cannot transgress the limits and parameters of the parent statute

It is equally well-settled that rule-making power is an incidental power that must follow and not run parallel to the parent statute

Such legislation has to be interpreted in a way which conformed to and stayed within the parameters of the parent statute

No doubt, all efforts are to be made to interpret the rules so as to bring them in conformity and without injuring the intent and spirit of the statute, however where it was not possible, then the rules inasmuch as they injured the very intent and spirit must yield to the statute

Courts, therefore, will require due proof that the rules / regulations have been made and promulgated in accordance with the statutory authority and if those fail to comply with statutory essentials, the Courts may declare the same as invalid and ultra vires

To determine the vires of delegated legislation, High Court has to examine whether such delegated legislation was beyond the power granted by the enabling legislation and whether such delegated legislation was consistent with the parent statute

High Court declared the provision of R.19(3)(b) of the Punjab Government Servants Housing Foundation Rules, 2013 to be inconsistent and ultra vires to the Punjab Government Servants Housing Foundation Act, 2004

Constitutional petition, filed by mother of deceased unmarried son (Government Servants), was allowed, in circumstances.

Rules are considered subordinate and delegated legislation deriving authority and legal cover from the provisions of main statute and cannot override the provisions of statute

To determine vires of delegated legislation, Court has to examine as to whether, such delegated legislation is beyond the power granted by enabling legislation and whether such delegated legislation is consistent with and in furtherance of parent statute

Delegated legislation can be struck down if it is repugnant to general purpose of the statute which authorized it or is in conflict with the main statute.

Rules are considered subordinate and delegated legislation deriving authority and legal cover from the provisions of main statute and cannot override the provisions of statute

To determine vires of delegated legislation, Court has to examine as to whether, such delegated legislation is beyond the power granted by enabling legislation and whether such delegated legislation is consistent with and in furtherance of parent statute

Delegated legislation can be struck down if it is repugnant to general purpose of the statute which authorized it or is in conflict with the main statute.

Rules are considered subordinate and delegated legislation deriving authority and legal cover from the provisions of main statute and cannot override the provisions of statute

To determine vires of delegated legislation, Court has to examine as to whether, such delegated legislation is beyond the power granted by enabling legislation and whether such delegated legislation is consistent with and in furtherance of parent statute

Delegated legislation can be struck down if it is repugnant to general purpose of the statute which authorized it or is in conflict with the main statute.

(i) Delegated legislation must be within the permissible limits of parent statute; (ii) It must not travel beyond the mandate of parent statute; (iii) It must not be in excess of jurisdiction conferred by the parent statute; (iv) It must not be in conflict with parent statute or the Constitution; and (v) while framing rules / regulations in exercise of authority conferred by parent statute, the rules / regulations framing authority should not assume role of Parliament and attempt to amend provisions of parent statute through delegated legislation.

Delegated legislation is intended to enforce the law and advance the purpose of the underlying legislature, without overriding it and while minutiae could be filled in, the parent statute could neither be added to nor subtracted from.

Delegated legislation is intended to enforce the law and advance the purpose of the underlying legislature, without overriding it and while minutiae could be filled in, the parent statute could neither be added to nor subtracted from.

Delegated legislation can be declared as illegal only where it is established that it is repugnant to any settled and well-established principle of statute or result of excessive delegation

Such legislation cannot be struck down mainly on the ground that it is mala fide or unreasonable and there are strong presumptions that it can be misused.

Rules are subordinate and delegated legislation deriving authority and legal cover from the provisions of main statute and cannot override provisions of the statute

To determine vires of delegated legislation, High Court has to examine whether such delegated legislation was beyond the power granted by enabling legislation and whether such delegated legislation was consistent with the parent statute

Rule of interpretation is that delegated legislation can only be struck down if it was directly repugnant to general purpose of the statute which authorized it or was repugnant to well established principle of statute

Provisions of R. 267(1) of Punjab Motor Vehicle Rules, 1969, were framed granting right of appeal in respect of matters enumerated in Chapter VIII of Punjab Motor Vehicle Rules, 1969, which had been framed by deriving authority from S. 96 of Provincial Motor Vehicle Ordinance, 1965, the parent statute

Power of delegated legislation bestowed by Provincial Motor Vehicle Ordinance, 1965, was rightly exercised while framing Punjab Motor Vehicle Rules, 1969, especially the rules assailed by petitioner

High Court declared the rules intra vires the parent statute as there was nothing on record to suggest that Rr. 96 & 267 (1) of Punjab Motor Vehicle Rules, 1969, were framed without any sanction of law rather they were validly framed by exercising authority of delegated legislation conferred by parent statute.

When Court is required to determine legality of delegated legislation, the same can only be declared ultra vires or illegal if they are found repugnant to Act, violative of the object and reasons of the enactment or lack of sanction etc.

Similarly, through a policy, a valid subordinate legislation can neither be made redundant nor superseded and no policy can be made in conflict therewith.

Principles of delegated legislation entitle the delegatee to carry out the mandate of the legislature, either by framing rules, or regulations, which translate and apply the substantive principles of law set out in the parent legislation

They can fill in details but not vary the underlying statutory principles.

Criteria to consider the subordinate/delegated legislation to be given protection or to declare it otherwise is to be settled by way of a test, whether the same surpasses the parent statute, per se.

Delegated legislation cannot override the statute either by exceeding authority or by making provision inconsistent with parent statute

General power to make rules or legislation for carrying out or giving effect to statute is strictly ancillary to its nature and cannot enable the authority on which the power is conferred to extend the scope of general operation of the statute

Similarly, the authority cannot extend the purpose of statute or add new or different meaning of carrying it out or depart from or vary its terms

Any rule/regulation which the authority has power to make is liable to be declared invalid if powers entrusted for one purpose are deliberately used with design of achieving another or if it shows on its face misconstruction of law or failure to comply with conditions prescribed under the parent statute for the exercise of the powers or if it is not capable of being related to any purpose mentioned in the parent statute.

Criteria to consider the subordinate/delegated legislation to be given protection or to declare it otherwise is to be settled by way of a test, whether the same surpasses the parent statute, per se.

Delegated legislation cannot override the statute either by exceeding authority or by making provision inconsistent with parent statute

General power to make rules or legislation for carrying out or giving effect to statute is strictly ancillary to its nature and cannot enable the authority on which the power is conferred to extend the scope of general operation of the statute

Similarly, the authority cannot extend the purpose of statute or add new or different meaning of carrying it out or depart from or vary its terms

Any rule/regulation which the authority has power to make is liable to be declared invalid if powers entrusted for one purpose are deliberately used with design of achieving another or if it shows on its face misconstruction of law or failure to comply with conditions prescribed under the parent statute for the exercise of the powers or if it is not capable of being related to any purpose mentioned in the parent statute.

Legislature cannot delegate un-canalized and uncontrolled power, as the power to delegate must not be unconfined and vagrant but must be canalized within banks that keep it from overflowing

Banks that set the limits of power delegated are to be constructed by the legislature by declaring the policy of a law and-by laying down standards for guidance of those on whom the power to execute the law is conferred.

Explained.

Delegated legislation forms an important part of the statutory law, which expounds and explains the skeleton principles of the parent statute in order to achieve the purpose of the said legislation.

Question before High Court was as to under what circumstances a delegated legislation or any part thereof can be put under judicial scrutiny to be followed by declaratory dictum of its being illegal and ultra vires

Held; if delegated legislation is directly repugnant to the general purpose and object of the very Act, under which such powers were created and passed on, or if it is repugnant to any settled and well established principle of statute or result of excessive delegated legislation then it can be declared ultra vires

Delegated legislation cannot be questioned on the ground of mala fide or unreasonableness because there is a strong general presumption attached to its legality and the onus to prove otherwise will be on the person who asserts it to be against the statute.

Delegated legislation can be ultra vires parent legislation when it is in conflict with provisions of parent statute, when enacted without following procedures prescribed in parent statute, if it has been enacted in excess of powers conferred by parent statute, if it has been enacted for mala fide or collateral purposes not envisaged by parent statute or when exercise of authority is found to be arbitrary or capricious.

Regulation No. 7(3) of the Punjab Healthcare Commission Regulations for Banning Quackery, 2016 had empowered the Committee to impose fine upon person found to be practicing quackery, which was against the express provisions of the Punjab Healthcare Commission Act, 2010

Under S.4(g) of the Act, 2010 such power was the sole prerogative of the Punjab Health Care Commission and the same could not have been delegated to a Committee nominated by the said Commission under Regln. 2(c).

Rules framed under parent statute were to remain within precinct of statute itself and could not transgress limits and parameters of parent statute.

Such legislation entitles delegatee to carry out mandate of legislation, either by framing rules or regulations, which translates and applies substantive principles of law set out in parent legislation or by recourse to detailed administrative direction and instructions for implementation of law

Rules which are merely subordinate legislation, cannot override or prevail upon the provisions of parent statute

If there is any conflict between a statute and subordinate legislation, it does not require elaborate reasoning to firmly state that the statute prevails over subordinate legislation and bye-law, if not in conformity with the statute in order to give effect to the statutory provision the Rule or bye-law has to be ignored

Statutory provision has precedence and must be complied with

Rule which comes in conflict with main enactment has to give way to the provisions of the Act

Rules are meant only for the purpose of carrying out the provisions of the Act and they cannot take away what was confirmed by the Act or whittle down its effect.

Petitioners were importers who were aggrieved of imposing and collection of Regulatory Duty through Notification SRO No.1035(I)/2017 dated 16-10-2017

Division Bench of High Court had earlier declared the amendment made in S.18(3) of Customs Act, 1969, ultra vires the Constitution

Appeal filed before Supreme Court was withdrawn by the authorities on the basis of new amendment inserted in S.221-A(2) of Customs Act 1969, vide Finance Act, 2018

Plea raised by petitioners was that regulatory duty imposed pursuant to notification SRO No.1035(I)/2017, dated 16-10-2017 could not be validated through subsequent amendment

Validity

Through amendment in question while inserting subsection (2) of S.221-A of Customs Act, 1969, an attempt was made to render judgment of Division Bench of High Court in earlier case as well as earlier judgment passed of Supreme Court as redundant and of no legal effect

Amendment in question also intended to validate amendment in S.18 (3) of Customs Act, 1969, vide Finance Act, 2017 and imposing of Regulatory Duty through notification SRO No.1035(I)/2017, dated 16-10-2017, by giving retrospective effect i.e. from the date of commencement of Finance Act, 2017 till the date of commencement of Finance Act, 2018

Unfettered powers were not delegated under Art.98 of the Constitution to Parliament to delegate taxing powers to any person or authority other than Federal Government, however only to the extent of permissible delegated legislation

Imposing of Regulatory Duty was a species of delegated legislation, therefore, it could only be a function of Federal Government i.e. Federal Cabinet comprising of Prime Minister and other Federal Ministers

High Court declared that S.221-A(2) of Customs Act, 1969, as added vide Finance Act, 2018 was ultra vires the Constitution, as through amendment in question Legislature attempted to validate Constitutional defect while making amendment in S.18(3) of Customs Act, 1969 and issuance of notification SRO No.1035(I)/2017, dated 16-10-2017, through Finance Act, 2017, without making required Constitutional amendment

High Court directed that Regulatory Duty charged and collected pursuant to amendment in S.18(3) of Customs Act, 1969, and issuance of notification SRO No.1035(I)/2017, dated 16-10-2017, through Finance Act, 2017 had already been declared by Division Bench of High Court in an earlier judgment as illegal and unconstitutional in the light of judgment of Supreme Court, therefore, in absence of any Constitutional amendment, the same could not be validated through subsequent amendment in law, while giving retrospective effect in respect of past and closed transaction, therefore, no Regulatory Duty could be charged, collected or recovered for the period starting from the date of commencement of Finance Act, 2017 till the date of commencement of Finance Act, 2018

Constitutional petition was allowed accordingly.

Rules and Regulations if framed could not travel beyond the scope of parent Act and such type of addition under the law could not be achieved under the garb or semblance of removal of difficulties clause.

Delegatee must have legislative guidelines to formulate Rules and Regulations, and such guidelines, contours or boundaries must come from the Legislature (Parliament) itself

Legislature could confer upon any person or body the power to make subordinate/delegated legislation (Rules, Regulations or byelaws, etc.) in order to give effect to the law enacted by it yet it must perform itself the essential legislative function, i.e. to exercise its own judgment on vital matters of policy and enact the general principles providing guidance for making the delegated legislation.

Provisions of a statute, if they dealt with a subject matter in considerable detail, then scope of delegated legislation correspondingly became limited and if a statute generally dealt with the subject matter, then scope of delegated legislation made under it shall become greater and it was assumed that legislature consciously decided to leave details to be filled out by delegated legislation

Theory underlying principle of delegated legislation was that legislature was only concerned with general principles whereas executive and other authorities authorized to make delegated legislation, addressed matters of administration

Grant of power of legislation included power to enact incidental or ancillary legislation, which power was inherent in Constitution

Presumption of validity existed with regard to delegated legislation and Rules made under statutory mandate ought to be read and interpreted in broad manner which made them consistent with parent statute

Court holding inquiry did not indulge in assessing Policy merits of such Rules or made assessment as to whether Rules would meet objectives set out by parent statute and powers delegated to a Authority for framing Rules generally signified broad discretion reserved for it to make assessment as to what would advance purposes of parent statute and also measures as required to advance such purposes.

Determination as to whether Rules or Regulations were statutory or otherwise, was not solely to be based on whether their framing required approval of Federal Government but rather it was nature and area of efficacy of such Rules / Regulations which determined their status

Rules dealing with instructions for internal control or management were to be treated as non-statutory Rules while those whose area of efficacy was broader and / or complimentary to parent statute in matters of crucial importance were to be treated as statutory.

Generous degree of latitude in matter of delegation was permissible to the Legislature in socially benefit socially beneficial legislation.

Parliament delegated its Legislative function to regulators where it may not have the required expertise on technical matters or it may be unable to respond to change in a timely manner or to a specific need and therefore it gave flexibility in the application of the law by delegating its power to legislate

Statutory Rules and Regulations could enlarge the scope of the section of the statute under which they had been framed and a statutory authority must make Regulations/Rules in order to effectuate intention of the Legislature within the limits of the mandate given to such an authority

Rules framed, if inconsistent with the provisions of the statute and if the same defeated intention of the Legislature, would become invalid.

Tax could not be levied automatically through a delegated legislation until and unless it was leviable under the charging provision of the fiscal statute.

Rule-making body/authority could not frame rules which were in conflict with or in derogation of the substantive provisions of the statute under which said Rules were framed and in case of any inconsistency with the parent statute; the excessive rule would be considered illegal if it went beyond its delegated authority

When the Legislature conferred powers on a regulatory authority to frame rules, it was expected that such rules would advance the purpose of the Legislature and not run contrary to it.

When a parent statute (the governing law) does not empower levy of fee, then levy of such fee through delegated legislation in shape of by-laws is not permissible.

Levy of tax plays pivotal role in the society, but since it puts pecuniary burden on person, its imposition is not permissible unless warranted by law

Levying tax is essentially the domain of Parliament as mandated by Art. 77 of the Constitution

Article 77 of the Constitution provides in clear terms that tax can be imposed and collected either by or under authority of the Act of Parliament, and nowhere it is provided that Executive, on its own, can introduce some new tax on basis of rules in derogation to what the main statute prescribes

Purpose of delegating powers to Executive to frame rules, devise regulations and issue notifications and guidelines is only to facilitate implementation of laws to the best of their object and mandate

Executive, assuming such powers, is not permitted to frame rules or issue notification that are independent of the scheme of parent law

Any such attempt would render the rules, regulations, etc. nullity in eyes of law.

When a parent statute (the governing law) does not empower levy of fee, then levy of such fee through delegated legislation in shape of by-laws is not permissible.

Delegated legislation was that which proceeded from any authority other than sovereign power and was therefore dependent for its continued existence and validity on some superior or supreme authority

Delegated legislation was also referred to as secondary legislation or subordinate legislation or subsidiary legislation and was a law made by an executive authority under powers given to them by primary legislation in order to implement and administer the requirements of such primary legislation

Delegated legislation was thus law made by a person or body other than the Legislature but with Legislature's authority

Difference existed between administrative direction and delegated legislation and delegated legislation was binding on both administration and the individual and was enforceable through a court of law but a direction was not so binding and enforceable on an individual or third party

Foundational feature of subordinate legislation was that its source of power was the Legislature itself, while the source of any administrative direction was the statutory authority or agency, established by the same Legislature

Parent statute must clearly delegate such power of legislation to the authority in order to carry out the purposes of an Act.

Scope and object.

Delegated legislation entitled the delegate to carry out the mandate of the legislature, either by framing rules, or regulations, which translated and applied the substantive principles of law set out in the parent legislation or by recourse to detailed administrative directions and instructions for the implementation of the law

Delegated legislation was intended to enforce the law, not override it, and it could be used to fill in details but not vary the underlying statutory principles

In case of conflict delegated legislation must yield to the legislative will, as it was below and not above the law

Minutiae could be filled in but the basic law could neither be added to nor subtracted from.

Delegated legislation entitled the delegate to carry out the mandate of the legislature, either by framing rules, or regulations, which translated and applied the substantive principles of law set out in the parent legislation or by recourse to detailed administrative directions and instructions for the implementation of the law

Delegated legislation was intended to enforce the law, not override it, and it could be used to fill in details but not vary the underlying statutory principles

In case of conflict delegated legislation must yield to the legislative will, as it was below and not above the law

Minutiae could be filled in but the basic law could neither be added to nor subtracted from.