LEGISLATIVE RELATIONS

(Article 245-255)
Article 245. Extent of laws made by Parliament and by the Legislatures of States.—(1)
Subject to the provisions of this Constitution, Parliament may make laws for the whole or any
part of the territory of India, and the Legislature of a State may make laws for the whole or
any part of the State. (2) No law made by Parliament shall be deemed to be invalid on the
ground that it would have extraterritorial operation.
Article 246. Subject-matter of laws made by Parliament and by the Legislatures of States.—
(1) Notwithstanding anything in clauses (2) and (3), Parliament has exclusive power to make
laws with respect to any of the matters enumerated in List I in the Seventh Schedule (in this
Constitution referred to as the “Union List”). (2) Notwithstanding anything in clause (3),
Parliament, and, subject to clause (1), the Legislature of any State 1*** also, have power to
make laws with respect to any of the matters enumerated in List III in the Seventh Schedule
(in this Constitution referred to as the “Concurrent List”). (3) Subject to clauses (1) and (2),
the Legislature of any State has exclusive power to make laws for such State or any part
thereof with respect to any of the matters enumerated in List II in the Seventh Schedule (in
this Constitution referred to as the “State List”). (4) Parliament has power to make laws with
respect to any matter for any part of the territory of India not included 2 [in a State]
notwithstanding that such matter is a matter enumerated in the State List.
Article 248. Residuary powers of legislation.—(1) 4 [Subject to article 246A, Parliament]
has exclusive power to make any law with respect to any matter not enumerated in the
Concurrent List or State List. (2) Such power shall include the power of making any law
imposing a tax not mentioned in either of those Lists.
Article 249. Power of Parliament to legislate with respect to a matter in the State List in the
national interest
Article 250. Power of Parliament to legislate with respect to any matter in the State List if a
Proclamation of Emergency is in operation
Article 251. Inconsistency between laws made by Parliament under articles 249 and 250 and
laws made by the Legislatures of States
Article 252. Power of Parliament to legislate for two or more States by consent and adoption
of such legislation by any other State
Article 253. Legislation for giving effect to international agreements
Article 254. Inconsistency between laws made by Parliament and laws made by the
Legislatures of States.

1) The Doctrine of Territorial nexus can be invoked under the following circumstances-
• Whether a particular state has extra-territorial operation.
• If there is a territorial nexus between the subject- matter of the Act and the state making the
law. It signifies that the object to which the law applies need not be physically located within
the territorial boundaries of the state, but must have a sufficient territorial connection with the
state. A state may levy a tax on a person, property ,object or transaction not only when it is
situated within its territorial limits,but also when it has a sufficient and real territorial
connection with it.
 Wallace v. Income-Tax commissioner, Bombay A.I.R. 1948
Where a member of a company which was incorporated in England carried his business in
India and earned profits, P.C. held that India Could levy tax on the company for the whole
amount of the company as there was a sufficient territorial nexus between the Company and
India for the purpose of taxation . Held that the company could levy an income tax on the
entire income and not only on the portion accruing from India. The sufficient territorial nexus
is present between the Company and India.
 State of Bombay v. RMDC, 1951 ( Most important)
Facts- All the essential activities like filling up of the forms,entry fees etc for the competition
took place in Bombay.The state govt. sought to levy tax the respondent for carrying on
business in the state. The question for decision before the Supreme Court was if the
respondent,the organiser of the competition,who was outside the state of Bombay, could be
validly taxed under the Act.
It was held that there existed a sufficient territorial nexus to enable the Bombay Legislature to
tax the respondent as all the activities which the competitor is ordinarily expected to
undertake took place mostly within Bombay.
Issue- The question for decision before the Supreme Court was if the respondent, the
organizer of the competition, who was outside the state of Bombay, could be validly taxed
under the Act.
Decision-It was held that as all the activities which the competitor is ordinarily expected to
undertake took place most,if not in entirety,within Bombay. These circumstances constituted
a sufficient territorial nexus which the entitled state of Bombay to impose a tax on the
respondent.
 Tata Iron And Steel Company vs. Bihar State
The state of Bihar passed a Sales Tax Act for levy of sales tax
Issue- Tax Act for levy of sales tax whether the sale was concluded within the state or outside
if the goods were produced,found and manufactured in the state .
Decision-The court held there was sufficient territorial nexus and upheld the Act as valid.
Whether there is sufficient nexus between the law and the object sought to be taxed will
depend upon the facts and circumstances of a particular case.

It was pointed out that sufficiency of the territorial connection involved consideration of two
elements- a) the connection must be real and not illusory b) the liability sought to be imposed
must be pertinent to that connection.
  State of Bihar vs Charusila Dasi, 1959 AIR 1002
Bihar legislature enacted the Bihar Hindu Religious Trusts Act,1950, for the
protection and preservation of properties appertaining to the Hindu religious trusts.
The Act applied to all trusts any part of which was situated in the state of Bihar. The
Respondent created a trust deed of her properties of several houses and land in Bihar
and Calcutta. The trust being situated in Bihar.
The main question for decision was whether the Act apply to trust properties which are
situated outside the state of Bihar.
Can the legislature of Bihar make a law with respect to such a trust situated in bihar and other
properties appertaining to such trust which are situated outside Bihar?

Decision- Applying the doctrine of territorial nexus ,the Supreme court held that the Act
could affect the trust property situated outside Bihar, but appertaining to a trust situated in
Bihar where the trustees functioned. The Act aims to provide for the better administration of
Hindu religious trusts in the state of Bihar.The trust being situated in Bihar the state has
legislative power over it and also over its trustees or their servants and agents who must be in
Bihar to administer the trust.
What is necessary is that the connection between the trust and the property appertaining
thereto is real and not illusory and that the religious institution and the property appertaining
thereto form one integrated whole as one cannot be dissociated from the other.

2) Rule of Harmonious Construction

When there is a conflict between two or more statues or two or more parts of a statute then
the rule of harmonious construction needs to be adopted. The rule follows a very simple
premise that every statute has a purpose and intent as per law and should be read as a whole.
The interpretation consistent of all the provisions of the statute should be adopted. In the case
in which it shall be impossible to harmonize both the provisions, the court’s decision
regarding the provision shall prevail.
 The Supreme Court laid down principles of rule of Harmonious Construction in the
landmark case of CIT v Hindustan Bulk Carriers, AIR 2002 SC 3491 :
1. The courts must avoid a head on clash of seemingly contradicting provisions and they must
construe the contradictory provisions so as to harmonize them.
2. The provision of one section cannot be used to defeat the provision contained in another
unless the court, despite all its effort, is unable to find a way to reconcile their differences.
When it is impossible to completely reconcile the differences in contradictory provisions, the
courts must interpret them in such as way so that effect is given to both the provisions as
much as possible.
3. Courts must also keep in mind that interpretation that reduces one provision to a useless
number or dead is not harmonious construction.

 Calcutta Gas Company Pvt. Limited v State of West Bengal, 1962 AIR 1044
The Legislative Assembly of WB passed the Oriental Gas Company Act in 1960. The
respondent sought to take over the management of the Gas Company under this Act. The
appellant challenged the validity of this act by holding that the state Legislative Assembly
had no power to pass such an Act under Entries 24 and 25 of the State List because the
Parliament had already enacted the Industries (Development and Regulation) Act, 1951 under
Entry 52 of the Central List dealing with industries. It was observed by the Supreme Court
that there are so many subjects in three lists in the Constitution that there is bound to be some
overlapping and it is the duty of the courts in such situation is to yet to harmonise them, if
possible, so the effect can be given to each of them. Entry 24 of the State List covers entire
Industries in the State. Entry 25 is only limited to the Gas industry. Therefore Entry 24 covers
every industry barring the Gas Industries because it has been specifically covered under Entry
25. Corresponding to Entry 24 of the State List, there is Entry 52 in the Union List.
Therefore, by harmonious construction it became clear that gas industry was exclusively
covered by Entry 25 of the State List over which the state has full control. Therefore, the state
was fully competent to make laws in this regard.
 Commissioner of Sales Tax, MP v Radha Krishna,1979
Under section 46 (1) c of the Madhya Pradesh General Sales Tax Act, 1958, criminal
prosecution of the respondent partners was sanctioned in this case by the Commissioner when
even after repeated demands the assesse did not pay the sales tax. The respondent challenged
this provision on the ground that there were two separate provisions under the Act, namely,
section 22 (4 – A) and section 46 (1) c under which two different procedures were prescribed
to realize the amount due but there was no provision of law which could tell that which
provision should be applied in which case. According to the Supreme Court, the provision
prescribed u/s 46 (1) c was more drastic. It was held that by harmonious construction of these
two provisions, the conclusion drawn is that the Commissioner had a judicial discretion to
decide as to which procedure to be followed in which case. Whenever the Commissioner will
fail to act judicially, the court will have the right to intervene. However, in this case, the
Commissioner had correctly decided that the more drastic procedure under section 46 (1) c
deserved to be followed because of the failure of the assesse firm in paying sales tax despite
the repeated demands by the sales tax officer.
Venkatarama Iyer, J., “The rule of construction is well settled that when an enactment there
are in an enactment two provisions which cannot be reconciled with each other, they should
be so interpreted that, if possible, effect should be given to both. This is what is known as the
rule of harmonious construction.”– Venkataramana Devaru v. State of Mysore, AIR 1958. In
this case the Supreme Court applied the rule of harmonious construction in resolving a
conflict between Articles 25(2)(b) and 26(b) of the Constitution and it was held that the right
of every religious denomination or any section thereof to manage its own affairs in matters of
 religion [Article 26(b)] is subject to a law made by a State providing for social welfare and
reform or throwing open of Hindu religious institutions of a public character to all classes and
sections of Hindus [Article 25(2)(b)].

3) Doctrine of Colourable Legislation

 It is invoked when the legislature attempts do a thing indirectly which it can not do
directly.
 However, if competence of the legislature is established the motives are irrelevant.
logically if there is no competency, in spite of having best intentions, the law would
be invalid.
 State Of Bihar Vs. Kameshwar Singh,1952: This is the only case where a law has
been declared invalid on the ground of colourable legislation. the Indian Supreme
Court for the first time invoked the doctrine of colurable legislation. In this case the
Bihar Land Reforms Act,1950, was held void on the ground that though apparently it
purported to lay down principle for determining compensation yet in reality it did not
lay down any such principle and thus indirectly sought to deprive the petitioner of any
compensation.
 K. C. Gajapati Narayan Deo v. State of Orissa. AIR 1953: The Orissa Agricultural
Income-Tax (Amendment) Act of 1950 could not be held to be a piece of colourable
legislation - a legislation on "taxing of agricultural income" as described in Entry 46,
List. II of the Seventh Schedule. The State Legislature had undoubted competency to
legislate on agricultural income-tax and the substance of the amended legislation of
1950 is that it purports to increase the existing rates of agricultural income-tax, the
highest rate being fixed at 12 annas 6 pies in the rupee. This may be unjust or
inequitable, but that does not affect the competence of the legislature. It was observed,
the Constitution of a State distributes the legislative powers amongst different bodies,
which have to act within their respective spheres marked out by specific legislative
entries, or if there are limitations on the legislative authority in the shape of
fundamental rights, questions do arise as to whether the legislature in a particular case
has or has not, in respect to the subject-matter of the statute or in the method of
enacting it, transgressed the limits of its constitutional powers. Such transgression
may be patent, manifest or direct, but it may also be disguised, covert and indirect and
it is to this latter class of cases that the expression 'colourable legislation'. The
doctrine of colourable legislation does not involve any question of 'bond fides' or
'mala fides' on the part of the legislature. The whole doctrine resolves itself into the
question of competency of a particular legislature to enact a particular law. If the
legislature is competent to pass a particular law, the motives which impelled it to act
are really irrelevant.
4) Doctrine of Pith and Substance
This doctrine comes into picture when there is a conflict between the different subjects in
different lists. Pith means ‘true nature’ or ‘essence of something’ and Substance means ‘the
most important or essential part of something’.
Doctrine of Pith and Substance says that where the question arises of determining whether a
particular law relates to a particular subject (mentioned in one List or another), the court
looks to the substance of the matter. Thus, if the substance falls within Union List, then the
incidental encroachment by the law on the State List does not make it invalid.
This is essentially a Canadian Doctrine now firmly entrenched in the Indian Constitutional
Jurisprudence.
 Cushing v. Dupey. In this case the Privy Council evolved the doctrine, that for deciding
whether an impugned legislation was intra vires, regard must be had to its pith and
substance.
The doctrine has been applied in India also to provide a degree of flexibility in the otherwise
rigid scheme of distribution of powers. The reason for adoption of this doctrine is that if
every legislation were to be declared invalid on the grounds that it encroached powers, the
powers of the legislature would be drastically circumscribed.
 The case of Prafulla Kumar Mukherjee v. The Bank of Commerce, Khulna,1947
explained the situation in which a State Legislature dealing with any matter may
incidentally affect any Item in the Union List.
If the encroachment by the State Legislature is only incidental in nature, it will not affect the
Competence of the State Legislature to enact the law in question. Also, if the substance of the
enactment falls within the Union List then the incidental encroachment by the enactment on
the State List would not make it invalid.
 State of Bombay And Another v F.N. Balsara, 1951
Under entry 31 of List II, State of Bombay passed Bombay prohibition Act, 1949- prohibited
among other things even ‘import, export, transport’ or ‘possession of liquor by any person –
Entry 19 in list I the central legislature has exclusive power to legislate with respect to
‘import and export’ across the frontiers. The court held, it is well settled that the validity of
an Act is not affected if it incidentally trenches on matters out side the authorised field and
therefore it is necessary to inquire in each case what is the pith and substance of the Act
impugned. If the Act so viewed substantially falls with in the powers expressly conferred
upon the legislature which enacted it, it can not be held to be invalid merely because it
incidentally encroaches on matters which have been assigned to another legislature. – the
Act was held valid.

 Praneeth v University Grants Commission (UGC) August 28, 2020,

5) Doctrine of Repugnancy
Art 254. (1) If any provision of a law made by the Legislature of a State is repugnant to any
provision of a law made by Parliament which Parliament is competent to enact, or to any
provision of an existing law with respect to one of the matters enumerated in the
Concurrent List, then, subject to the provisions of clause (2), the law made by Parliament,
whether passed before or after the law made by the Legislature of such State, or, as the case
may be, the existing law, shall prevail and the law made by the Legislature of the State
shall, to the extent of the repugnancy, be void.

(2) Where a law made by the Legislature of a State with respect to one of the matters
enumerated in the Concurrent List contains any provision repugnant to the provisions of an
earlier law made by Parliament or an existing law with respect to that matter, then, the law
so made by the Legislature of such State shall, if it has been reserved for the consideration
of the President and has received his assent, prevail in that State:
Provided that nothing in this clause shall prevent Parliament from enacting at any time any
law with respect to the same matter including a law adding to, amending, varying or
repealing the law so made by the Legislature of the State.
 The essential condition for application of Art.254(1) is that the existing law must be
with respect to one of the matters enumerated in the concurrent list (Premnath v J&K
1959, 749). The question of repugnancy under Art.254 (1) arises only in the case
legislations occupy the same field in the matters enumerated in the concurrent list and
there is a direct conflict.
 The Supreme Court observed in Zaverbhai Amaidas v. State of Bombay 1954, the
words with respect to that matter are of great importance in the Article 254(2). It
stated that the important thing to consider was whether the legislation was in respect
to the same matter. If the later legislation deals with a matter which is distinct from
the subject of the earlier legislation but is of a cognate and allied character, then
Article 254(2) will have no application.
 Deep Chand Vs. State of U.P. AIR 1959 S.C. 648: The question was whether there
exists repugnancy between Motor Vehicles (Amendment) Act 1956 and U.P.
Transport Services (Development) Act ,1955. Presumably, Parliament with a view to
introduce a uniform law throughout the country avoiding defects found in practice
passed the Amending Act inserting Chapter IV-A in the Motor Vehicles Act, 1939 for
nationalization scheme. This object would be frustrated if the argument that both the
U. P. Act and the Amending Act should co-exist in respect of schemes to be framed
after the Amending Act, is accepted. The Amending Act occupies the same field in
respect of the schemes initiated under the State Act after the Amending Act and
therefore to that extent the State Act must yield its place to the Central Act. But the
same cannot be said of the schemes framed under the U. P. Act before the Amending
Act came into force. What is void under Art. 254 (1) is not the entire Act but only to
the extent of its repugnancy with the law made by Parliament.
 In M. Karunanidhi v. Union of India, 1979, the Supreme Court held that, where the
provisions of a Central Act and a State Act in the Concurrent list are fully inconsistent
and absolutely irreconcilable, the Central Act will prevail and the State Act will
become void in view of the repugnancy. Determination - Test.
1. That in order to decide the question of repugnancy it must be shown that the two
enactments contain inconsistent and irreconcilable provisions, so that they cannot
stand together or operate in the same field.
2. That there can be no repeal by implication unless the inconsistency appears on the
face of the two statutes.
3. That where the two statutes occupy a particular field, but there is room or
possibility of both the statutes operating in the same field without coming into
collision with each other, no repugnancy results.
4. That where there is no inconsistency but a statute occupying the same field seeks to
create distinct and separate offences, no question of repugnancy arises and both the
statutes continue to operate in the same field.
In most federal constitutions and democracies across the world, the doctrine of
repugnancy is embedded to resolve the conflict between a law made by the center and
a conflicting law made by the state. In most case, the decision is in favor of the central
law. In the United States of America, if a federal law conflicts with a state law, then
the federal law pre-empts the state law. In Australia, until 1986, the law for the
territories was considered repugnant to the Commonwealth law, which was the
supreme law.