ATLAS CYCLE

INDUSTRIES LTD.
VS
STATE OF HARYANA

(AIR 1979 SC 1149)

 INTRODUCTION
• In a democracy like India, the legislature has invariably performed a
considerable part in formation of policy. However, due to excessive
burden, the Parliament resolved to delegation of several powers to
executive for convenient implementation of legislations. This casts an
invariable responsibility on the legislature to control the way how the
executive discharges the tasks delegated to it. It possesses a rightful
duty to supervise the executive and in case of any abuse or misuse of
the said power, censure executive's unauthorized actions. In order to
effectuate this, two measures are employed by legislature:
• Laying of Delegated Legislation on table
• Examination of Delegated Legislation by Scrutiny Committees
 The consequences of non- compliance with the laying provisions
depends on whether the previsions are mandatory or directory.
In the present, the Apex Court has dealt with the first method.

FACTS: On December 1964, the Development Officer, New Delhi

carried spot checking on appellant factory, at Sonipat,on inspection of
its accounting records, discovered the purchase of premium quality iron
and steel plates at a price which was higher than the ceiling price fixed
by the Iron and Steel Controller. He was accordingly held for offence
u/S.120B, IPC r/w S.7, Essential Commodities Act, 1955. Thereon,
the charges were framed against him, which he opposed through an
application u/S.251 A & 288(1), CrPC3 but it was dismissed by the
Special Magistrate. The aggrieved appealed to High Court but gained
nothing and hence, approached the Apex Court for relief.
ARGUMENT OF THE PARTIES :
• Appellant
• The Appellant mainly contended that the impugned notification for
fixing the maximum purchase price of iron and steel plates is void for
non-compliance of the mandate of S.3(6) of Essential Commodities
Act. It specifies that the Central Government has to lay any order
passed by it or by its authorized officer, before the Parliament as and
when it is made.
• Respondent
• The said provision is merely directory and does not require mandatory
compliance. Hence, non-observance of the same won't make the
control order ultra-vires. Furthermore, the impugned notification being
a control order and therefore, a delegated legislation, cannot be made
to be necessarily placed before the Parliament, as it would otherwise
defeat the whole object of delegating the said power to executive.
ISSUES:
• Whether the laying procedure embodied u/S.3(6) of the Essential
Commodities Act, 1955 is obligatory?
• Whether the omission to lay the notification under question before the
Parliament renders it void?
REASONS BEHIND THE JUDGEMENT:
• The Court then went on to define three kinds of laying procedure,
generally employed by the legislature to keep a check on delegated
legislation, which were also reiterated in latter judgements and are as
follows:
• Laying without further procedure: This is the simple laying where
the delegated legislation comes into force immediately after laying
before legislature. It casts a duty upon executive to merely notify the
legislature of the delegated legislation so formulated and therefore, is
simply of directory character.
• Laying subject to negative resolution: In this type of laying, a
delegated legislation comes into effect immediately after it has been
placed before the legislature subject to the condition of it not being
nullified by legislature within forty days. The general parlance for this
most widely utilized laying procedure is "subject to annulment by
either House of Parliament".
• Laying subject to affirmative resolution: This is affirmative laying
where the delegated legislation could be effectuated only after it has
been duly approved by both the Houses of Parliament. It does not
specify any time limit but the legislature is supposed to do the job as
soon as possible. This type of laying procedure comes with the major
pitfall of its mandatory observance and time taking procedure which
eventually flouts the ultimate purpose of delegated legislation. Thus, it
should only be used sparingly where delegated legislation is of such
nature that it itself amounts to writing the Act.
JUDGEMENT
• The Apex Court held that Sec3(6) of ECA, 1955 stated that every order
made by the Central Govt. Or by any officer or authority of the Central
Govt. shall be laid before both the Houses of Parliament as soon as
or may be after it is made.
• Here, the use of shall is not conclusive and decisive of the matter.
The court further added that what is necessary is to determine the
scope of the statute. For assessing real intention of the Legislature,
the court may consider the nature and design of the statute. Thus, the
aforesaid notification eas held valid and constitutional.