Civil Appeals Nos
255769 2070 1423 1434 1733 2474 2575 257872 95 105 1318 1371 74 204073 2100 210274 and 120 121  536 of 1975
From the Judgment and Order dated 24 9 69 16 8 71 25 1 72 16 2 72 11 2 72 10 2 72 22 11 72 21 7 72 8 2 72 25 7 72 31 5 72 and 4 3 75 of the Kerala High Court in WA Nos80969 846 47 855 867 894 and 940 of 1969 26171 and 957 58983988 and 10216994269 42771 458 415 407 408  68 of 1971 and 211 24170 3 and 771 34272 36 42 and 43 of 1971 and 559 Civil Appeal No 2117 of 1972
Appeal by Special Leave from the Judgment and Order dated 17 8 71 of the Kerala High Court in WA No 1021 of 1969
Lal Narain Sinha Solicitor General of India A G Puddissery for the Appellant in CA No 255769
V A Seyid Mohammed and K M K Nair for the Appellant in CA No 2070
A K Sen In CA Nos 142372 M P Jha In CA 142372 A G Puddissery In all the petitions for the appellants in CAs
1423 1434 1735 2474 2575 2576 7872 1318 1371 1374 204073 2100 210274 120 121 53675
P C Chandi K M K Nair and K R Nambiar for the Appellants in CAs
211772 and 95 10573
section V Gupte Ajay Ray and P Mathai O C Mathur K J John and J B Dadachanji for the Appellants in CA
No 145771
G Rathi Advocate General for the State of Orissa and B Parathasarthy for the Appellant in CA Nos
165274
Vinoo Bhagat for the Appellants In CAs
1653 54774
section V Gupte In CA
No 255769 P Mathai Ajay Ray O C Mathur K John J B Dadachanji and Mrs section Bhandare In CA No 2070 for Respondent Nos 1 In CA
No 255769  In CAs
Nos2070 1423 2472
G B Pai K J John O C Mathur J B Dadachanji and P K Kurian In CAs
173372 for Respondent No 1 In CAs
1426 1429 1431 1434 173372 2577 78 95 96 99 100 and 102 10573
N Sudharkaran P Mathai and P K Pillai for Respondent Nos 1 In CA
No 257572 and CA No 142572
K R Nambiar for Respondent No 2 In CA
No 257572 2576 7872 and 204073
Miss Lily Thomas for Respondent No 1 In CA
No 257672
A section Nambiar for Respondent No 1 In CA
No 257872
N Sudharkaran for Respondent No 1 In CA
No 97773
G B Pai In CA Nos
2100 210274 12175 P Mathai In CA
131875 Ranjit Mahanty Ajay Ray In CAs
No 165274 and O C Mathur K J John and J B Dadachanji In all matters for Respondent No1 In CA No 131873 2100 210274 12175 for the Respondents In CAs
165274
Lal Narain Sinha Solicitor General of India In CA No 145771 A G Puddissery for the Respondent In CA
No 1457 and 164171
560 T section Krishnamoorthy Iyer P Mathai N Sudharkaran and P K Pillai for Respondent No 1 In CA
No 1371 and 137473 and In CA No 137373 K M K Nair for Respondent No 2 In CAs
1371 137473
G L Sanghi P Mathai K J John O C Mathur and J B Dadachanji for Respondent No 1 In CA
No 137273
GRathi Advocate General for the State of Orissa and B Parthasarthy for Respondents In CAs
1653 1654774
P K Pillai for the Intervener In CA
No 2070
G LSanghi P V Kapur U K Khaitan for Ferro Alloys Corpn K R Choudhry K Raj Choudhry for AP Electricity Board for the Intervener In CA No 165274
section Balakrishnan for Respondent No 1 in CA
No 204073
Note Mrs Sunanda Bhandare Advocate appeared for the applicant intervener in CA
1457 and 164271 and CA
1652 165474 and Mr B Sen Senior Advocate appeared for Respondent No 1 In CA
2070 and applicant intervener in CA
No 165274
The Judgment of the Court was delivered by Alagiriswami J
A C Gupta J gave a dissenting Opinion
ALAGIRISWAMI J
The validity of the Kerala State Electricity Supply Kerala State Electricity Board and Licensees Areas Surcharge Order 1968 is in question in these appeals
That Order was passed in exercise of the powers conferred by section 3 of the Kerala Essential Articles Control Temporary Powers Act 1961
It obliges the Board to collect surcharges from non licensee consumers of electricity even though the Board may have entered into long term contracts with them with regard to the rate at which electricity is to be supplied to them
The Act is one to provide in the interest of the general public for the control of the production supply and distribution of and trade and commerce in certain articles
Section 2a of the Act defines essential articles as meaning any article not being an essential commodity as defined in the Essential Commidities Act 1955 which may be declared by the Government by notified order to be an essential article
Section 3 enables the Government if of opinion that it is necessary or expedient so to do for maintaining or increasing the supplies of any essential article or for securing their equitable distribution and availability at fair prices to make notified orders providing for a regulating by licences permits or otherwise the production or manufacture of any esential article b controlling the price at which any essential article may be bought or sold 561 c regulating by licences permits or otherwise the storage distribution transport disposal acquisition use or consumption of any essential article d prohibiting the withholding from sale of any essential article ordinarily kept for sale e requiring any person holding in stock any essential article to sell the whole or a specified part of the stock to the Government or to an officer or agent of the Government or to such other person or class of persons and in such circumstances as may be specified in the order f regulating or prohibiting any class of commercial or financial transactions relating to any essential article which in the opinion of the authority making the order are or if unregulated are likely to be detrimental to the public interest g collecting any information or statistics with a view to regulating or prohibiting any of the aforesaid matters h requiring persons engaged in the production supply or distribution of or trade or commerce in any essential article to maintain and produce for inspection such books accounts and records relating to their business and to furnish such information relating thereto as may be specified in the order i regulating the processing of any essential article j exercising over the whole or any part of an existing undertaking such functions of control and subject to such conditions as may be specified in the order k any incidental and supplementary matters including in particular the entering and search of premises vehicles vessels and aircraft the seizure by a person authorised to make such search of any article in respect of which such person has reason to believe that a contravention of the order has been is being or is about to be committed the grant or issue of licences permits or other documents and the charging of fees therefor
In exercise of the powers under section 2a electricity was declared as an essential article in 1965
Electricity is the only article declared as an essential article under the Act so far and in spite of the wide powers with regard to making of notified orders under section 3 the impugned Surcharge Order is the only order so far made
It provides as already stated for levying of a surcharge on supplies of electricity made to bulk consumers many of whom are respondents in these appeals
The validity of the Act itself is not seriously questioned except in one respect which we shall deal with later but it is contended that by the declaration of electricity as an essential article under the Act the 562 Act impinges upon various matters either in List I or List III of the Seventh Schedule to the Constitution
According to Mr Gupte who appeared for the respondent in Civil Appeal No 2557 of 1969 the legislation is repugnant to the Electricity Act 1910 and the  in particular the latter which falls within Entries 43 and 44 of List I
According to Mr B Sen who appeared for the respondents in Civil Appeal No 20 of 1970 the Act trenches upon the field occupied by the which falls partly under Entry 43 of List I and partly under Entry 38 of List III
According to Mr G B Pai who appeared for the 1st respondent in Civil No 1733 of 1972 the 1948 Act falls within Entry 44 of List I and the Kerala Act impinges upon that field
On the contrary the Solicitor General appearing on behalf of the Kerala State Electricity Board contends that the Kerala Act falls under Entries 26 and 27 of List II of the Seventh Schedule to the Constitution
There is in the arguments on behalf of the respondents a certain amount of confusion
The question of repugnance arises only in case both the legislations fall within the same List III
There can therefore be no question of repugnance between the Electricity Act and the on the one hand and the Kerala Act on the other if the former fall in List I or List III and the latter in List II
If any legislation is enacted by a State Legislature in respect of a matter falling within List I that will be without jurisdiction and therefore void
The scope of the legislative powers of the Parliament and the State Legislatures is now well settled
They are found in Article 246 of the Constitution which reads  246
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 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 a 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 the 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 in a State notwithstanding that such matter is a matter enumerated in the State List
 563 In view of the provisions of Article 254 the power of Parliament to legislate in regard to matters in List III which are dealt with by clause 2 is supreme
The Parliament has exclusive power to legislate with respect to matters in List I The State Legislature has exclusive power to legislate with respect to matters in List II
But this is subject to the provisions of clause 1 leaving out for the moment the reference to clause 2
The power of Parliament to legislate with respect to matters included in List I is supreme notwithstanding any thing contained in clause 3 again leaving out of consideration the provisions of clause 2
Now what is the meaning of the words notwithstanding in clause 1 and subject to in clause 3  They mean that where an entry is in general terms in List II and part of that entry is in specific terms in List I the entry in List I takes effect notwithstanding the entry in List II
This is also on the principle that the special  excludes the general  and the general entry in List II is subject to the special entry in List I
For instance though house accommodation and rent control might fall within either the State List or the Concurrent List Entry 3 in List I of Seventh Schedule carves out the subject of rent control and house accommodation in cantonments from the general subject of house accommodation and rent control see Indu Bhusan vs Sundari Devi1
Furthermore the word notwithstanding  in clause 1 also means that if it is not possible to reconcile the two entries the entry in List I will prevail
But before that happens attempt should be made to decide in which list a particular legislation falls
For deciding under which entry a particular legislation falls the theory of pith and substance has been evolved by the Courts
If in pith and substance a legislation falls within one List or the other but some portion of the subject matter of that legislation incidentally trenches upon and might come to fall under another List the Act as a whole would be valid notwithstanding such incidental trenching
These principles have been laid down in a number of decisions
In re The Central Provinces and Berar Act No XIV of 19382 Sir Maurice Gwyer observed with reference to the corresponding provisions of the Government of India Act as follows  It will be observed that by s1001 the Federal Legislature is given exclusive powers enumerated in the Federal Legislative List notwithstanding anything in the two next succeeding sub sections of that section
Sub section 2 is not relevant to the present case but ss3 is as I have stated the enactment which gives to the Provincial Legislatures the exclusive powers enumerated in the Provincial Legislative List
Similarly Provincial Legislatures are given by s1003 the exclusive powers in the Provincil Legislative List subject to the two preceding sub sections that is sss
1 and 2
Accordingly the Government of India further contend that even if the impugned Act were otherwise within the competence of the Provincial Legislature it is nevertheless invalid because the effect of the 564 non obstante clause in s1001 and a fortiori of that clause read with the opening words of s1003 is to make the federal power prevail if federal and provincial legislative powers overlap He observed further  Only in the Indian Constitution Act can the particular problem arise which is now under consideration and an endeavour must be made to solve it as the Judicial Committee have said by having recourse to the context and scheme of the Act and a reconciliation attempted between two apparently conflicting jurisdictions by reading the two entries together and by interpreting and where necessary modifying the language of the one by that of the other
If indeed such a reconciliation should prove impossible then and only then will the non obstante clause operate and the federal power prevail for the clause ought to be regarded as a last resource a witness to the imperfections of human expression and the fallibility of legal draftsmanship
 In Subrahmanyan Chettiar vs Mutuswami Goundan1 the same learned CJ observed  Section 1003 of the Constitution Act provides that a Provincial Legislature has the exclusive power of legislating with respect to the matters enumerated in List II the Provincial Legislative List
But this power is expressly stated to be subject to the provisions of s1001 which give an exclusive power to the Federal Legislature to legislate with respect to the matters enumerated in List I the Federal Legislative List
Hence though Parliament has no doubt done its best to enact two lists of mutually exclusive powers it has also provided ex majori cautela that if the two sets of legislative powers should be found to overlap then the federal legislation is to prevail
And the reason for this is clear
However carefully and precisely lists of legislative subjects are defined it is practically impossible to ensure that they never overlap and an absurd situation would result if two inconsistent laws each of equal validity could exist side by side within the same territory
 In the same case Sulaiman J observed  On a very strict interpretation of s100 it would necessarily follow that from all matters in List II which are exclusively assigned to Provinicial Legislatures all portions which fall in List I or List III must be excluded
Similarly from all matters falling in List III all portions which fall in List I must be excluded
The section would then mean that the Federal Legislature has full and exclusive power to legislate with respect to matters in List I and has 565 also power to legislate with respect to matters in List III
A Provincial Legislature has exclusive power to legislate with respect to List II minus matters falling in List I or List III has concurrent power to legislate with respect to matters in List III minus matters falling in List I
In its fullest scope section 100 would then mean that if it happens that there is any subject in List II which also falls in List I or List III it must be taken as cut out from List II
On this strict interpretation there would be no question of any real overlapping at all
If a subject falls exclusively in List II and no other List then the power of the Provincial Legislatures is supreme
But if it does also fall within List I then it must be deemed as if it is not included in List II at all
Similarly if it also falls in List III it must be deemed to have been excluded from List II
The dominant position of the Central Legislature with regard to matters in List I and List III is thus established
But the rigour of the literal interpretation is relaxed by the use of the words with respect to which as already pointed out only signify pith and substance and do not forbid a mere incidental encroachment
 In Governor General in Council vs Province of Madras1 the Judicial Committee of the Privy Council observed  For in a Federal Constitution in which there is a division of legislative powers between Central and Provincial legislatures it appears to be inevitable that controversy should arise whether one or other legislature is not exceeding its own and encroaching on the other s constitutional legislative power and in such a controversy it is a principle which their Lordships do not hesitate to apply in the present case that it is not the name of the tax but its real nature its pith and substance as it has sometimes been said which must determine into what category it falls In Prafulla Kumar Mukherjee and Others vs Bank of Commerce Limited Khulna2 the Judicial Committee of the Privy Council quoted with approval the observations of Sir Maurice Gwyer CJ in Subrahmanyan Chettiar s case supra to the effect  It must inevitably happen from time to time that legislation though purporting to deal with a subject in one list touches also on a subject in another list and the different provisions of the enactment may be so closely intertwined that blind observance to a strictly verbal interpretation would result in a large number of statutes being declared invalid because the legislature enacting them may appear to have legislated in a forbidden sphere
Hence the rule which has been evolved by the Judicial Committee whereby the impugned statute is examined to ascertain its pith and substance  or 566 its true nature and character  for the purpose of determining whether it is legislation with respect to matters in this list or in that
 They also held  Thirdly the extent of the invasion by the Provinces into subjects enumerated in the Federal List has to be considered
No doubt it is an important matter not as their Lordships think because the validity of an Act can be determined by discriminating between degrees of invasion but for the purpose of determining what is the pith and substance of the impugned Act
Its provisions may advance so far into Federal territory as to show that its true nature is not concerned with Provincial matters but the question is not has it trespassed more or less but is the trespass whatever it be such as to show that the pith and substance of the impugned Act is not money lending but promissory notes or banking  Once that question is determined the Act falls on one or the other side of the line and can be seen as valid or invalid according to its true content
This view places the precedence accorded to the three lists in its proper perspective
 The matter has been elaborately discussed in Union vs H section Dhillon1
All the relevant earlier decisions have been considered there and for the purpose of these cases it is not necessary to enter into any further discussion on this aspect
Having discussed the question of the legislative field it might be necessary to discuss the question as to what happens if it should be held that the matter under consideration in these cases falls within the Concurrent List that is Entry 38 in List III as contended in the alternative by some of the respondents
As already mentioned the question will arise only if it should be held that the Kerala State Act falls under Entry 38 as contended by Mr B Sen
If the impugned legislation falls under List III then the question of repugnancy of that legislation with the existing law or the law made by Parliament as the case may be will have to be considered
Both the 1910 Act as well as the 1948 Act are existing law as contemplated under Article 372 of the Constitution
An existing law continues to be valid even though the legislative power with respect to the subject matter of the existing law might be in a different list under the Constitution from the list under which it would have fallen under the Government of India Act 1935
But after the Constitution came into force an existing law could be amended or repealed only by the legislature which would be competent to enact that law if it were to be newly enacted
In that sense both the 1910 Act and the 1948 Act could be amended or repealed by the Parliament and also by the State Legislature if it obtains the Presitential assent to an Act amending or repealing the 1910 Act or 1948 Act leaving aside for the moment the question whether they 567 fall wholly or partly under Entries 43 and 44 of List I of the Seventh Schedule to the Constitution
That the question of repugnancy can arise only with reference to a legislation falling under the Concurrent List is now well settled
In A section Krishna vs State of Madras1 after referring to section 107 of the Government of India Act 1935 which is in terms similar to clause 1 of Article 254 this Court observed For this section to apply two conditions must be fulfilled  1 The provisions of the Provincial law and those of the Central legislation must both be in respect of a matter which is enumerated in the Concurrent List and 2 they must be repugnant to each other
It is only when both these requirements are satisfied that the provincial law will to the extent of the repugnancy become void
 To the similar effect is the decision in P N Kaul vs The State of JK2
The whole question of repugnancy is elaborately discussed in J  K State vs M section Farooqi3
Let us now therefore consider what in its pith and substance is the subject matter of the Kerala Act
Is it an Act dealing with incorporation regulation and winding up of trading corporations including banking insurance and any financial corporations but not including cooperative societies Entry 43 or incorporation regulation and winding up of corporations whether trading or not with objects not confined to one State but not including universities Entry 44 Clearly the Act itself does not deal with any of these subjects
It is true that the notification issued under section 2a declaring electricity as an essential article enable orders to be made under section 3 of the Act
But the only question we are concerned with in this case is the validity of the surcharge order
No notified order has been made under any of the powers conferred on the State by section 3 except the impugned Surcharge Order
If the Act had stood as it is or even if the notification had stood as it is nobody would have any cause for complaint
It is only by the issue of the Surcharge Order that the respondents have been affected
It is for the purpose of deciding the question of the validity of the Surcharge Order that we have to decide the validity of the declaration under section 2a of electricity as an essential article
Does the notification make the legislation one relating to electricity under Entry 38 of List III  Was it necessary to get the President s assent for this notification as contended of the respondents  Quite clearly no Presidential assent to the notification
Article 2542 does not contemplate assent to notifications issued under the Act
The Article contemplates Presidential assent only to laws made by the Legislature of a State
We shall later deal with the question whether the assent of the President to the Act after the 1965 notification declaring electricity as an essential article validates that notification
The Electricity Act 1910 and the can be said to cover the whole field relating to electricity under Entry 568 38 of List III of the Seventh Schedule
We are clearly of the opinion that the argument of Mr Pai that the 1948 Act falls under Entry 44 of List I has no substance
It does not deal with the incorporation regulation and winding up of a corporation with objects not confined to one State
The Central Electricity Authority created by that Act is not an incorporated body whereas the various State Electricity Boards are incorporated
The Act deals with the incorporation and regulation of the State Electricity Boards
Where a State Electricity Board is to operate beyond the limits of the State for which it is constituted it is done only by means of an agreement with the other State in which it is to operate
The Statement of Objects and Reasons of that Act does not help his contention
The coordinated development of electricity in India on a regional basis for which the Government felt it necessary to bring in legislation which resulted in the cannot show that it deals with the incorporation and regulation of an inter State corporation
The statement itself proceeds on the basis that the executive power will vest in the Provinces which means that the legislation falls in the Concurrent List
The Statement of Objects and Reasons also mentions the necessity for the constitution of semi autonomous bodies like Electricity Boards to administer the grid systems
The Electricity Boards as already mentioned are confined to the jurisdiction of States
The Statement of Objects and Reasons itself shows that what was contemplated was a legislation under the Entry in the Concurrent List
The Statement of Objects and Reasons however mentions Entry 33 of the Federal List of the Government of India Act 1935 as the Entry under which the legislation was undertaken
That Entry corresponds to Entries 43 and 44 of List I of Seventh Schedule to the Constitution
Therefore the Statement of Objects and Reasons does not show that the falls under Entry 44
The question then is whether it falls within Entry 43
The fact that the Statement of Objects and Reasons mentions Entry 33 of List I of the Government of India Act as the legislative head under which the legislation was being undertaken is not conclusive
We have therefore to consider whether the falls under Entry 43 as contended by some of the respondents
There is no doubt that the Act does deal with the incorporation and regulation of the Electricity Boards but the question is whether in pith and substance it is a legislation regarding the constitution and regulation of the Electricity Boards falling under Entry 43 of List I or on electricity falling under Entry 38 of List III
The object of the as seen from the preamble is to rationalise the production and supply of electricity and to take measures conducive to electrical development
In the Statement of Objects and Reasons it is stated that there is necessity for the constitution of semi autonomous bodies like Electricity Boards to administer the grid system on quasi commercial lines and that such Boards cannot however be set up by Provincial Governments under the existing Constitutional Act as they would be in the nature of trading corporations within the meaning of Entry 33 of the Federal Legislative List
 The Statement of Objects and 569 Reasons though not relevant for the purpose of interpreting the sections of the Act will throw light upon the object of the legislature from the historical viewpoint
Let us now look at the Act itself
Section 3 provides for the constitution of a Central Electricity Authority
It says that the Central Government shall constitute a body called the Central Electricity Authority to exerise such functions and perform such duties and in such manner as the Central Government may prescribe or direct
Section 5 provides for the constitution and composition of State Electricity Boards
Section 6 says that the Government of any State may in lieu of constituting a Board under section 5 enter into an agreement with the Government of a contiguous State to provide that the Board constituted for the latter State shall exercise the functions of a Board under the Act in the former State
Section 7 deals with the effect of inter State agreement as contemplated in section 6
Section 8 provides for terms and conditions of appointment of the members of the Board
Section 9 relates to the qualifications of the members of the Board
Section 10 deals with removal or suspension of the members of the Board
Section 10A gives power to the State Government to declare void certain transactions in connection with which a member has been removed under the provisions of section 10 on 12 provides that the Board shall be a body corporate
Section 14 provides for the meetings of the Board
Section 15 deals with the appointment of the staff by the Board
Section 16 states that the State Government shall constitute a State Electricity Consultative Council for the State and provides for constitution of that body
Section 17 provides for the constitution of a Local Advisory Committee
Section 18 describes the general duties of the Board
Section 19 says that the Board may supply electricity to any licensee or person requring such supply in any area in which a schme sanctioned under Chapter V is in force
Section 20 provides for power of the Board to engage in certain undertakings
Section 21 concerns the power of the Board in relation to water power
By section 22 the Board is invested with power to conduct investigations experiments and trials for the improvement of the methods of transmission distribution and supply etc
of electricity
Section 24 deals with the power of the Board to contribute to contribute to certain associations engaged in generation distribution and supply of electricity
Section 25 says that the Board may from time to time appoint qualified persons to be Consulting Engineers to the Board
Section 26 says that the Board shall have all the powers and obligations of a licensee under the 
Section 28 concerns the preparation of scheme for establishement of generating stations etc
Section 29 provides for publication and sanctioning of schemes prepared under section 28
Section 30 deals with the matters to be considered by the authority in recommending a scheme
Sections 31 and 32 also relate to sechemes
Section 34 deals with controlled stations
Section 35 provides for the supply by the Board to licensees owning generating stations while section 36 gives power to the Board to close down generating stations
Section 37 provides for Purchase of generating stations of undertaking or main transmission lines by the Board
Section 38 makes provision for establishing new generating stations by 570 the Board
Section 39 deals with the arrangements to be made with the licensee for operation of the Board s generating stations
Section 40 makes provision regarding the connections with main transmission lines purchased by the Board
Section 41 relates to the use by the Board of transmission lines
Section 42 provides for power of the Board for placing wires poles etc
Section 43 describes the powers of the Board to enter into arrangements for purchase or sale of electricity  under certain conditions
Section 44 places certain restrictions on establishment of new generating stations or major additions or replacement of plant in generating statons
Section 45 says that if any licensee fails to close down his generating station pursuant to a declaration of the Board under section 36 or if any person establishes or acquires a new
generating station the Board may authorise any of its officers to enter upon the premisess of such station and shut down the station
Section 46 provides for Grid Tariff
It says that a tariff to be known as the Grid Tariff shall in accordance with any regulations made in this behalf be fixed from time to time by the Board in respect of each area for which a scheme is in force and tafiffs fixed under the section may if the Board thinks fit differ for different areas and subsection 2 of that section provides that the Grid Tariff shall apply to sales of electricity by the Board to licensees in other so required under any of the first second and third schedules and shall also be applicable to sales of electricity by the Board to licensees in other cases
Section 47 vests power in the Board to make alternative arrannements with licensees
Section 49 makes provision for sale of electricity by the Board to persons other than licensees
Section 50 says that the Board should not supply electricity in certain circumstances
Section 55 provides that licensees should comply with the directions of the Board
Section 63 says that the State Government may make subventions to the Board for the purpose of the Act
Section 64 provides for loans by the State Government to the Board
Section 65 gives power to the Board to borrow
Section 66 provides for guaranteeing of loans raised by the Board by the State Government
Section 67 provides for priority of the liabilies of the Board
Section 68 makes provision for depreciation reserve
Secton 69 deals with the accounts of the Board and their audit
Section 76 provides for arbitration of all disputes arising between the State Government or the Board and licensee or other person
Section 78 vests power in the State Government to make rules
Section 78A says that in the discharge of its functions the Board shall be guided by such directions on question of policy as may be given to it by the Government
Section 79 vests power in the Board to make regulations
Section 81 says that all members officers and servants of the Board shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code
It would be obvious that one part of the Act does deal with the constitution of the Board the incorporation of the Board and the regulation of its activities
But the main purpose of the Act is for rationalising the production and supply of electicity
The regulation contemplated in Entries 43 and 44 is not regulation of the business of production distribution and supply of electricity of the corporation
As the 1910 and 1948 Acts together form a complete code with res 571 pect to Entry 38 in List III the Board is only an instrument fashioned or carrying out this object
The provision regarding the incorporation and regulation of the Electricity Board should be taken to be only incidental to the provision regarding production supply and distribution of electricity
It was observed by this Court in R C Cooper vs union1 The argument raised by Mr Setalvad intervening on behalf of the State of Maharashtra and the State of Jammu and Kashmir that the Parliament is competent to enact Act 22 of 1969 because the subject matter of the Act is with respect to regulation of trading corporations and matters subsidiary and incidental thereto and on that account is covered in its entirety by Entries 43 and 44 of List I of the Seventh Schedule cannot be upheld
Entry 43 deals with incorporation regulation and winding up of trading corporations including banking companies
Law regulating the business of a corporation is not a law with respect to regulation of a corporation
In List I entries expressly relating to trade and commerce are Entries 41  42
Again several entries in List I relate to activities commercial in character
Entry 45 Banking Entry 46 Bills of exchange cheques promissory notes and other like instruments Entry 47 Insurance Entry 48 Stock exchanges and future markets Entry 49 Patents inventions and designs
 There are several entries relating to activities commercial as well as non commercial in List II Entry 21 Fisheries Entry 24 Industries   Entry 25 Gas and Gas works Entry 26 Trade and commerce Entry 30 Money lending and money lenders Entry 31 Inns and Inn keeping Entry 33 Theaters and dramatic performances cinemas etc
We are unable to accede to the argument that the State Legislatures are competent to legislate in respect of the subject matter of those entries only when the commercial activities are carried on by individuals and not when they are carried on by corporations
Therefore the provisions in the 1948 Act regarding the Board s functions do not make it one falling under Entry 43 of List I
In Ramtanu Housing Society vs Maharashtra2 this Court had dealt with the Maharashtra Industrial Development Act 1961 and the question whether the Maharashtra Development Corporation formed under the Act was a trading corporation
In holding that the legislation fell under Entry 24 of the State List and not under Entry 43 of the Union List this Court observed 
11970 3 SCR530
21971 1 SCR719
572 The Act is one to make a special provision for securing the orderly establishment in industrial areas and industrial estates of industries in the State of Maharashtra and to assist generally in the organisation thereof and for that purpose to establish an Industrial Development Corporation and for purposes connected with the matters aforesaid
The Corporation is established for the purpose of securing and assisting the rapid and orderly establishment and organisation of industries in industrial areas and industrial estates in the State of Maharashtra
Broadly stated the functions and powers of the Corporation are to develop industrial areas and industrial estates by providing amenities of road supply of water or electricity street lighting drainage 
Or otherwise transfer any property held by the Corporation on such conditions as may be deemed proper by the Corporation
The principal functions of the Corporation in regard to  the establishment growth and development of industries in the State are first to establish and manage industrial estates at selected places and secondly to develop industrial areas selected by the State Government
When industrial areas are selected the necessity of acquisition of land in those areas is apparent
The Act therefore contemplates that the State Government may acquire land by publishing a notice specifying the particular purpose for which such land is required 
Where the land has been acquired for the Corporation or any local authority the State Government shall after it has taken possession of the land transfer the land to the Corporation or that local authority It is in the background of the purposes of the Act and powers and functions of the Corporation that the real and true character of the legislation will be determined  
Industries come within Entry 24 of the State List
The establishment growth and development of industries in the State of Maharashtra does not fall within Entry 7 and Entry 52 of the Union List
Establishment growth and development of industries in the State is within the State List of industries Acquisition or requisition of land falls under Entry 42 of the Concurrent List
In order to achieve growth of industries it is necessary not only to acquire land but also to implement the purposes of the Act
The Corporation is therefore established for carrying out the purposes of the Act
The pith and substance of the Act is establishment growth and organisation of industries acquisition of land in that behalf and carrying out the purposes of the Act by setting up the Corporation as one of the limbs or agencies of the Government
The powers and functions of the Corporation show in no uncertain terms that these are all in 573 aid of the principal and predominant purpose of establishment growth and establishment of industries
The Corporation is established for that purpose
We therefore hold that the Act is a valid piece of legislation
 In the present case the incorporation of the State Electricity Boards is merely for the rationalisation of the production and supply of electricity
for taking measures conducive to Electrical development and for all matters incidental thereto
The incorporation of the Electricity Boards being incidental to the rationalisation of the production and supply of electricity and for being conducive to electrical development the 1948 Act in pith and substance should be deemed to be one falling under Entry 38 of List III
Furthermore Electricity Boards are not trading corporations
They are public service corporations
They have to function without any profit motive
Their duty is to promote co ordinated development of the generation supply and distribution of electricity in the most efficient and economical manner with particular reference to such development in areas not for the time being served or adequately served by any licensee Section 18
The only injunction is that as far as practicable they shall not carry on their operations at a loss Section 59
They get subventions from the State Governments Section 63
In the discharge of their functions they are guided by directions on questions of policy given by State Governments Section 78A
There are no shareholders and there is no distribution of profits
This is another reason why the 1948 Act cannot be said to fall under Entry 43 of List I The question therefore is whether the impugned legislation falls under Entry 38 of List III or Entries 26 and 27 of List II and if the former whether it is repugnant to the existing law on the subject
that is the 1910 and 1948 Acts and if that were so whether that repugnancy has been cured by Presidential assent  Even assuming that part of the 1948 Act is legislation with respect to incorporation and regulation of a trading corporation falling under Entry 43 of List I of Schedule Seven the rest of it will fall under Entry 38 of List III
That part of the Act relating to the regulation of the activities regarding production and distribution of electricity would as we have shown fall under the Entry Electricity 
The Kerala Act has nothing to do with the incorporation and regulation of the Electricity Board and therefore it can only relate to Entry 38 of List III if at all
The argument of the learned Solicitor General appearing on behalf of the Kerala Electricity Board in support of his submission that the legislation falls under Entries 26 and 27 of List II may be summarised as follows Those entries do not enable the State Legislatures to legislate with regard to all conceivable goods like arms ammunition atomic minerals etc
as was argued by Mr Sen A legislature while legislating with respect to matters within its competence should be deemed to know its limits and its legislative authority and should not be deemed to be legislating beyond its jurisdiction
One thing that has always 574 got to be kept clear in one s mind is that there may be more than one aspect with regard to a particular subject matter
Essential articles  is a term which has acquired a definite connotation in Indian legislative practice and is not a vague or a general term
In the Government of India Act 1935 Entries 27 and 29 in List I correspond to Entries 26 and 27 of List II in the Constitution
There was no entry in that Act corresponding to Entry 33 of List III of the Constitution
Section 102 of that Act enabled the Federal Legislature to legislate in the State List during the emergency
During the World War the Defence of India Act 1939 enabled the Central Government to make such rules as appeared to it necessary or expedient for maintaining supplies and services essential to the life of the community
Rule 81 of the Defence of India Rules dealt with maintaining supplies and services essential for the life of the community and electricity was specifically referred to as an article within the scope of that rule Many orders regarding electricity were made during the course of that war like Electricity Control order 1942 of Bihar
When the proclamation of emergency was revoked on 141946 the laws made by the Federal Legislature with respect to matters included in the Provincial Legislative List would have ceased to have effect and therefore the British Parliament enacted India Central Government and Legislative Act 1946 enabling the Federal Legislature to make laws with respect to trade and commerce whether or not within the Province  in and production supply and distribution of cotton woollen textiles papers foodstuffs etc
and in exercise of that power the Central Legislature enacted Essential Supplies Temporary Powers Act 1946 for continuance of powers to control production supply and distribution etc
In respect of articles not covered by the Central Act the Provinces passed similar laws regarding other essential commodities for instance Madras Essential Articles Control and Requisitioning Act 1949 in respect of ten articles including electricity
At present electricity is the only article included within the scope of that Act
The was passed by Parliament on 1455
Essential commodity was defined in that Act
It practically included every matter regarding industry within the legislative competence of Parliament
Thus the word essential commodity  is an expression corresponding to a commodity essential to the life of the community
It is not therefore open to the authority exercising powers under section 2a of the Kerala Act to declare any and every commodity as an essential commodity
That Act deals with essential articles not being essential articles dealt with by the Central Act of 1955
It is not an Act with respect to the incorporation or regulation of trading corporations and therefore does not all under Entry 43 or 44 of List I
It is not a legislation with respect to electricity and therefore does not fall under Entry 38 of List III
Electricity being beyond doubt an essential article may be declared to be an essential article under the Act
In that case the power exercised is not in relation to electricity qua electricity but electricity as an essential article
The Act therefore in pith and substance is with respect to trade and commerce and production supply and distribution
We agree that this is the correct view
It is not a permanent legislation with respect to electricity but a temporary one dealing with a temporary situation
There can be no 575 doubt about the argument on behalf of the Board that the Surcharge order is necessary for its survival and existence without which there can be no production or supply of electricity
That is why it is a matter falling under Entries 26 and 27 of List II
It is no valid criticism of this view to say that the powers of the Board under the 1948 Act are overridden by the Surcharge order and the order is therefore repugnant to the 1948 Act
Indeed the Board is more than willing it is anxious for the Surcharge order to be made
It is not necessary to resort to section 59 for this purpose
This is a simple case of a contract being overridden in exercise of statutory powers
In the alternative it is argued as follows The Kerala Act insofar as it deals with electricity can be deemed to be legislation under Entry 38 in List III
Though the Act itself has not declared any article as an essential article when a declaration was made under section 2a in 1965 declaring electricity as an essential article for the purposes of the Act it became part of the Act
When the President assented to the Kerala Act in 1962 it may be that it cannot be deemed that he had assented to it on the basis that the provisions of that Act were repugnant to some Act made by Parliament or some existing law in the concurrent field because there was nothing in the Act itself which made it repugnant to any Act passed by Parliament or any existing law
But when he assented in 1967 to the Act extending the life of the Kerala Act by another two years the declaration of electricity as an essential article had been made and should be deemed to have become part of the Act
So far we are in agreement with the argument of the learned Solicitor General
But when he goes further and argues that insofar as the consequence of such declaration was that the State Government was enabled to make orders regarding production supply and distribution of electricity there was a possibility of such orders being repugnant to the provisions of the Electricity Act 1910 and the and therefore any such repugnance was cured by the assent given by the President we cannot agree
We agree that the assent should be Deemed not merely to the substitution of the words five years by the words seven years in the Kerala Act but to the Act as a whole that is as amended by the 1967 Act and any repugnance between the Kerala Act and the Electricity Act 1910 and the should be deemed to have been cured by such assent
When assenting to the 1967 Act the President should naturally have looked into the
whole Act that is the 1961 Act as amended by the 1967 Act
But the declaration itself did not create any repugnancy with the 1948 Act
It was in 1968 that the Surcharge order was made in pursuance of which the bills were served on the various respondents in these appeals and demands made for enhancing charges for electricity
And it was the Surcharge order that can be said to create the repugnancy if at all
It is only actual repugnancy that can be cured by Presidential assent and not the possibility of repugnancy
Mr Krishnamoorthy Iyer appearing for the respondents in Civil Appeals Nos 1371 and 1373 74 of 1973 is therefore right when he argues that the declaration of electricity as an essential article in 1965 did not in any way affect the rights of the respondents but only the 576 Surcharge order of 1968 and that as the bills for enhanced charges for electricity were served on the respondents in 1968 before the 1969 amendment of the Act the Surcharge order and the demands made were not cured of their repugnancy till the 1969 Amendment Act was assented to by the President assuming that there is such repugnancy
It there is such repugnancy by virtue of the Surcharge order the assent of the President can cure the repugnancy between the Kerala Act and the 1910 and 1948 Acts only if it is subsequent to the Surcharge order
It is the exercise of the power under section 3 of the Kerala Act that is alleged to have created the repugnancy
We do not pause to consider whether there is in fact any repugnancy between the Surcharge order and the 1948 Act
The question still remains whether when a declaration is made under section 2a of the Act declaring an article as an essential article or an order is made under section 3 such a declaration or order becomes part of the Act  In England even where an Act declares that subsidiary legislation shall have effect as if enacted in the Act it does not preclude the Court from calling in question the subsidiary legislation where it is inconsistent with the provisions of the Act Minister of Health vs The King1
But it would appear that where the statute provides for the laying of the rules before Parliament and the Parliament could have annulled them such a provision would make the subordinate legislation beyond challenge Institute of Patent Agents vs Lockwood 2
In India many statutes both of Parliament and of State Legislatures provide for subordinate legislation made under the provisions of those statutes to be placed on the table of either the Parliament or the State Legislature and to be subject to such modification amendment or annulment as the case may be as may be made by the Parliament or the State Legislature
r Even so we do not think that where an executive authority is given power to frame subordinate legislation within stated limits rules made by such authority if outside the scope of the rule making power should be deemed to be valid merely because such rules have been placed before the legislature and are subject to such modification amendment or annulment as the case may be as the legislature may think fit
The process of such amendment modification or annulment is not the same as the process of legislation and in particular it lacks the assent either of the President or the Governor of the State as the case may be
We are therefore of opinion that the correct view is that notwithstanding the subordinate legislation being laid on the table of the House of Parliament or the State Legislature and being subject to such modification annulment or amendment as they may make the subordinate legislation cannot be said to be said unless it is within the scope of the rule making power provided in the statute
What happens then to a declaration made under section 2a or an order made under section 3 If such a declaration or order is not within the scope of the Act it should be held to be not valid
Does the subsequent assent of the President to an Amending Act which as 1 1931 AC494
21894 AC347
577 we have shown earlier in effect amounts to an assent to the whole Act cure this defect  We consider that the declaration itself can still be attacked if the power to make such a declaration is beyond the scope of the power delegated
Whether the power delegated can be attacked on the ground of excessive delegation of the legislative powers or on the ground that in so conferring the legislative power on the executive authority the legislature has abdicated its function or the legislature itself could not have me such a law is  a different question
There is a slight difference between such a situation and the one where it is held that the declaration is beyond the scope of the Act
That electricity is an essential article and therefore the 1965 declaration under section 2a declaring electricity as an essential article is valid cannot be disputed
It is not disputed that an article which is not in fact an essential article cannot be declared to be an essential article
The next question to be considered therefore is whether the declaration or the order can be said to be bad on the ground either that there was excessive delegation or that the legislature can be said to have abdicated its powers  In The Queen vs Burah1 it was observed Their Lordships agree that the Governor General in Council could not by any form of enactment create in India and arm with general legislative authority a new legislative powers
not created or authorized by the Council s Act
Nothing of that kind has in their Lordships  opinion been done or attempted in the present case
What has been done is this
The Governor General in Council has determined in the due and ordinary course of legislation to remove a particular district from the jurisdiction of the ordinary Courts and offices and to place it under new Courts and offices to be appointed by and responsible to the Lieutenant Governor of Bengal leaving it to the Lieutenant Governor to say at what time that change shall take place and also enabling him not to make what laws he pleases for that or any other district but to apply by public notification to that district any law or part of a law which either already was or from time to time might be in force by proper legislative authority in the other territories subject to his government The Legislature determined that So far a certain change should take place but that it was expedient to leave the time and the manner of carrying it into effect to the discretion of the Lieutenant Governor
and also that the laws which were or might be in force in the other territories subject to the same Government were such as it might be fit and proper to apply to this district also but that as it was not certain that all those laws and every part of them could with equal convenience be so applied it was expedient on that point also to entrust a discretion to the Lieutenant Governor This having been 1 5LR178194 578 done as to the Garo Hills what was done as to the Khasi and Jaintia Hills  The Legislature decided that it was fit and proper that the adjoining district of the Khasi and Jaintia Hills should also be removed from the jurisdiction of the existing Courts and brought under the same pro visions with the Garo Hills not necessarily and at all events but if and when the Lieutenant Governor should think it desirable to do so and that it was also possible that it might be expedient that not all but some only of those provisions should be applied to that adjoining district
And accordingly the Legislature entrusted for these purposes also a discretionary power to the Lieutenant Governor
Their Lordships think that it is a fallacy to speak of the powers thus conferred upon the Lieutenant Governor large as they undoubtedly are as if when they were exercised the efficacy of the acts done under them would be due to any other legislative authority than that of the Governor General in Council
Their whole operation is directly and immediately under and by virtue of this Act XXII of 1869 itself
The proper Legislature has exercised its judgment as to place person laws powers and the result of that judgment has been to legislate conditionally as to all these things
The conditions having been fulfilled the legislation is now absolute
Where plenary powers of legislation exist as to particular subjects whether in an imperial or in a provincial Legislature they may in their Lordships  judgment be well exercised either absolutely or Conditionally
Legislation conditional on the use of particular powers or on the exercise of a limited discretion entrusted by the Legislature to persons in whom it places confidence is no uncommon thing and in many circumstances it may be highly convenient
The British Statute Book abounds with examples of it and it cannot be sup posed that the Imperial Parliament did not when constituting the Indian Legislature contemplate this kind of conditional legislation as within the scope of the legislative powers which it from time to time conferred
 We are of opinion that the power conferred by the Kerala Act is a case of conditional legislation as contemplated in the above decision
The various types of powers that can be exercised under that Act are enumerated in it
Only the article with reference to which those powers are to he exercised is left to be determined by the executive
That will vary from time to time at one time salt may be an essential article at another time rice may be an essential article and on a third occasion match boxes
It is the executive that would be in a position to judge when and under what circumstances an article becomes an essential article and therefore it is necessary to 579 control the production supply and distribution or trade and commerce in a particular article
The corresponding Madras Act the Madras Essential Articles Control and Requisitioning Temporary Powers Act 1949 originally had ten articles included in the schedule as essential articles with powers to add others to the schedule
It now contains only one article in the schedule electricity
It cannot therefore be said to suffer from the vice of excessive delegation either
Subsequent decisions of this Court only emphasize this point
We may however refer to two recent decisions of this Court
In State of Punjab vs Khan Chand1 dealing with East Punjab Movable Property Requisitioning Act 1947 this Court held as follows The Act confers uncontrolled power on the State Government or the officers authorised by it to requisition any movable property
No guidelines have been laid down regarding the object or the purpose for which it becomes necessary or expedient to requisition a movable property
Even the authority requisitioning movable property is not required to specify the purpose for which it has become necessary or expedient to requisition that property
There is no provision in the Act that the power of requisitioning movable property can be exercised under the Act only for a public purpose nor is there any provision that powers under the Act can be exercised only in an emergency or in some special contingency
Hence the provisions of the Act violate Articles 14 and 19 of Constitution The Act did not even
provide for suitable machinery for determining the compensation payable to the owner of the movable property nor did it contain any guiding principles for determining the amount of compensation
But in the very same decision it was observed Considering the complex nature of problems which have to be faced by a modern State it is but inevitable that the matter of details should be left to the authorities acting under an enactment
Discretion has therefore to be given to the authorities concerned for the exercise of the powers vested in them under an enactment
 This decision considered the relevant decisions on the subject and is not against the view which we have taken We must however refer to the decision of this Court in Gwalior Rayon Mills vs Asst
Commr
T2 relied upon by the respondents
In that case it was found that the Parliament had laid down legislative policy and had not abdicated its legislative function
It is necessary to refer to the view taken in that case by the majority judgment that it is not correct to say that if the legislature can repeal an enactment it retains enough control over the authority making the subor 1 AIR1974 SC543
2 AIR l974 SC1660
580 dinate legislation and as such it is not necessary for the legislature to lay down legislative policy standard or guidelines in the statute
That was of course not the argument on behalf of the appellants in this case
But having regard to the fact that reference was made to the decision in Cobb  Co Ltd vs Kropp1 which is very often relied upon for contending that if the legislature conferred certain powers on an executive authority it could be upheld because the legislature could any time repeal the legislation and withdraw such authority and discretion as it had vested in that authority it is necessary to look a little more closely into that judgment
The main dispute there was about the State Transport Act 1960 passed by the legislature of Queensland
It was attacked on the ground that it unlawfully and unconstitutionally delegated to the Commissioner for Transport sovereign plowers of the legislature of Queensland to impose and levy taxes and would constitute an unlawful and unconstitutional transfer of sovereign power of legislature to the Commissioner or an abdication of such power in his favour
There were various other contentions to which it is not necessary to refer
In the same case the validity of the State Transport Facilities Act 1946 was also in question
Under the 1946 Act however a determination or a decision of the Commissioner was to be submitted to the Minister for his confirmation
Stable J described this provision as one under which the commissioner had a Parliamentary hand on his shoulder 
After referring to the various provisions of the Acts as well as the powers of the Queensland Legislature the Privy Council rejected the argument that the effect of the Acts was to create a new legislative authority
The Privy Council pointed out that it cannot rationally be said that there was any abandonment or abdication of power in favour of a newly created legislative authority and referred to the observations of the Privy Council in the Queen vs Burah supra
The Privy Council then went on to point out that  nothing comparable with a new legislative power armed with General authority has been created by the passing by the Queensland Legislature of the various Transport Acts
Reference was then made to the decisions in Hodge vs The Queen2 and Powel vs Apollo Candle Company Ltd3 and it was pointed out that the Queensland Legislature preserved its own capacity insect and retained perfect control over the Commissioner for Transport
It was in that context that they added inasmuch as it could at any time repeal the legislation and withdraw such authority and discretion as it had vested in him
This portion of the observations cannot be relied upon in every case where the question of excessive delegation arises to justify it merely on the ground that it is open to the legislature to repeal the legislation and withdraw the authority
This would be apparent from the extract from the judgment of Stable J which immediately follows thereafter obviously Parliament cannot directly concern itself with all the multitudinous matters and considerations which necessarily arise for daily and hourly determination within 11967 1 AC141
218839 App
Cas117 PC 3188510App
Cas282 PC 581 the ramifications of a vast transport system in a great area in the fixing of and collection of licensing fees
So as I see it on the face of the legislation Parliament has lengthened its own arm by appointing a commissioner to attend to all these matters including the fixing and gathering of the taxes which Parliament itself has seen fit to impose
The commissioner has not been given any power to act outside the law as laid down by Parliament
Parliament has not abdicated from any of its own power
It has laid down a framework a set of bounds within which the person holding the office created by Parliament may grant or refrain from granting licenses and fix assess collect or refrain from collecting fees which are taxes and the succeeding observations to the following effect The legislature were entitled to use any agent or any subordinate agency or any machinery that they considered appropriate for carrying out the objects and purposes that they had in mind and which they designated
They were entitled to use the Commissioner for Transport as their instrument to fix and recover the licences and permit fees
They were not abrogating their power to levy taxes and were not transferring that power to the commissioner
What they created by the passing of the Transport Acts could not reasonably be described as a new legislative power or separate legislative body armed with general legislative authority see R vs Burah 3 App
Nor did the Queensland legislature create and endow with its capacity a new legislative power not created by the Act to which it owes its own existence see In re The Initiative and Referendum Act
 PC
In no sense did the Queensland Legislature assign or transfer or abrogate their powers or renounce or abdicate their responsibilities
They did not give away or relinquish their taxing powers
All that was done was done under and by reason of their authority
It was by virtue of their will that licence and permit fees became payable  We agree with the view taken by the majority of this Court in Gwalior Rayon Mills  case
In the result we hold that the Kerala Act the 1965 declaration under section 2a and the 1968 Surcharge order under section 3 are all valid The result is that the appeals will have to be allowed but in Civil Appeals Nos 1425 2575 2576 of 1972 and 97 1373 and 1374 of 1973 a question regarding Article 14 has been raised which has not been considered by the High Court
In these cases the High Court will deal with that question alone and dispose of the matter afresh
In Civil Appeal No 1372 of 1973 the respondent is what is called a sanction holder under section 28 of the  191 582 and as such a licensee within the meaning of that term n clause 6 of section 2 of the 
The respondent has no objection to collecting the surcharge from those to whom it supplies electricity
The respondent s contention is a limited one that it need not pay surcharge on the electricity which it consumes
We consider this contention well founded and it is supported by the provisions of clause 3 and 8 of the Surcharge order which read together leave no room for doubt on that point
Clause 3 reads as follows 3
Notwithstanding anything to the contrary contained in any agreement entered into with any consumer or the conditions of service agreed upon by the Kerala State Electricity Board the Kerala State Electricity Board shall levy a surcharge in accordance with clause 5 on all supplies of electrical energy made by it either directly or through licensees Provided that no surcharge under this order shall be levied on a Bulk supplies of energy to the licensees b Low Tension supplies of energy for domestic residential purposes c Low Tension supplies of energy for agricultural purposes
 The respondent is a licensee and bulk supplies have been made to the licensee
It is not a consumer to whom the Board supplies electrical energy directly or through a licensee
It cannot be said that in consuming electricity itself the respondent is supplying electricity to itself
The Surcharge order clearly makes a distinction between the consumer on the one hand and the licensee on the other and makes no provision for surcharge in the case of consumption of electricity by a licensee
It would be therefore declared that the respondent in this appeal need not pay the surcharge on the electricity consumed by it
There will be no order as to costs
GUPTA J
I regret I am unable to agree that the Kerala Essential Articles Control Temporary Powers Act 1961 and the declaration and the surcharge order made respectively under sections 2a and 3 of that Act are valid
In my opinion the Kerala act is an invalid piece of legislation and as such the declaration and the surcharge orders are of no consequence
It is not necessary to restate the facts which have been set out fully in the Judgment of brother Alagiriswami J I shall briefly state the reasons for the view I have takenn The State Lagislature has power to make laws only with regard to matters specified in List II and List III in the Seventh Schedule of the Constitution subject to the provisions of article 2542
The Kerala Act as its long title shows is in Act to provide for the control of the produc 583 tion supply and distribution of and trade and commerce in certain articles
The Preamble of the Act also states that it was passed as it was considered expedient to provide for the control of the production supply and distribution of and trade and commerce in certain articles Sec
13 of the Act provides that the Act would remain in force for five years from the date of its commencement which was in January 1962
Sec31 empowers the State Government to make provisions by a notified order for regulating or prohibiting the production supply and distribution of any essential article  and trade and commerce therein if the Government thought it was expedient so to do for maintaining or increasing the supplies or for securing the equitable distribution of such essentiai articles
Sec 2a defines essential article as any article not being an essential commodity as defined in the which the Government by notified order might declare to be an essential article
The definition leaves it to State Government to decide what should be an essential article for the purpose of the Act
The Legislature is of course presumed to know the limits of its competence and assuming it is permissible to attribute similar knowledge to the Government as to the bounds of its authority under sec 2a an essential article may be any article covered by any of the entries in List 11 or List III except the classes of commodities mentioned as essential commodity in the 
Until therefore the Government issued a notification on December 10 1965 under sec 2a declaring electrical energy to be an essential article almost four years after the act came into force it was not possible even to guess what the Act was about
Thus the Act as passed had no positive content it was an empty husk and its insubstantiality if by itself not an ill validating factor exposes the want of a declared legislative policy in the Act
The Act does not give any indication as to the nature of the articles in respect of which it sought to control the production supply and distribution and trade and commerce
It confer on the Government the authority to declare any article an essential article and to exercise the aforesaid powers in respect of that article
The Act does not provide any guidance or lay down any test to ascertain what makes an article essential for the purpose of the Act
The reference to the in sec
2a which defines essential article  is merely to exclude from its purview the commodities covered by the  and only serves to emphasize its indefiniteness and makes it more difficult to find any clue to the nature of the articles the Legislature had in mind in enacting the Kerala Essential Articles Control Temporary Powers Act 1961
Almost the entire legislative field was left open to the Government to choose from and decide according to their own lights what should be an essential article
It hardly needs repetition that the Legislature cannot delegate the essential legislative function which means that the Legislature must declare the policy of the law and provide a standard for the guidance of the subordinate law making authority
The Kerala Act authorises the Government to declare any article as essential except those mentioned in the  without laying down any define criteria or standards
This I think is surrendering unguided and un 584 canalised power to the executive
I do not see how the Act can be called an instance of conditional legislation this is not a case where the Legislature having determined the policy has left the details to be supplied by the executive authority
I cannot think of a case where the Legislature s self effacement could be more complete
In my opinion the power conferred on the Government by the Kerala Act exceeds the limits of permissible delegation
I may now refer to another aspect of the case
As stated earlier the Kerala Essential Articles Control Temporary Powers Act 1961 came into operation in January 1962 and was to remain in force for five years from the date of its commencement
However the life of the Act was extended by successive amending Acts passed in 1967 1969 and 1970
article 2542 of the Constitution provides 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 It appears that the President had given his assent to the principal Act of 1961 and also to the successive amending Acts extending the life of the principal Act
The Act as it was passed in 1961 does not appear to contain any provision which was repugnant to any Central Act or existing law that being so the assent given to it seems redundant and of no consequence
obviously article 2542 contemplates an existing repugnancy and not possible future inconsistencies
in December 10 1965 the State Government issued a notification declaring electrical energy to be an essential article under sec
2a of the Act and on June 1 1968 the State Government made the Kerala State Electricity Supply Surcharge order in exercise of the powers conferred by sec
The surcharge order made in 1968 following the declaration of electrical energy as an essential article in 1965 is said to be in conflict with the provisions of the and the Electricity Supply Act1948
Both these Acts are existing laws
It was argued that assent of the President received for the amending Acts of 1967 1969 and 1970 cured the repugnancy introduced by the surcharge order
Assuming that assent given to the amending Acts would have the effect of curing the repugnancy if any in the principal Act the question remains where the declaration and the surcharge order part of the Act under which they were made  If they were not if the order declaring electrical energy as an essential article and the surcharge order were outside the Act then the assent given to the Act could not cure 585 the repugnancy arising from these two orders
article 2542 requires the State legislation containing the repugnant provision to be reserved for the consideration of the President before he gives his assent to it
Could it be said that the declaration and the surcharge order were provisions in the Kerala Essential Articles Control Temporary Powers Act 1961  this Court considered a similar question though in a different context in Chief Inspector of Mines vs Lala Karam chand Thappar1 In that case this Court was examining the effect of the repeal of the Mines Act 1923 on the regulations framed under that Act
Mines Act 1923 was repealed and was re enacted with certain modifications as the 
Sec 29 of the 1923 Act empowering the Central Government to make regulations consistent with the Act for specified purposes was reenacted in the 1952 Act as Sec
Regulations were made in 1926 under sec
29 of the 1923 Act but no regulations had been made under sec
57 of the 1952 Act at the relevant date in 1955
The question was whether in view of sec
24 of the General Clauses Act the Mines Regulations of 1926 could be said to have been in force at the relevant date as there was nothing in the later providing otherwise and the regulations were not inconsistent with the re enacted provisions
Sub sec
4 of sec
31 of the 1923 Act laid down inter alia that regulations and rules made under the Act would have the effect as if enacted in this Act overruling the contention that the regulations became part of the Act in view of sub sec
4 of sec
31 and that with the repeal of the Act the regulations also stood repealed as part of that Act this Court observed at page 23 of the report The true position appears to be that the rules and regulations do not lose their character as rules and regulations even though they are to be of the same effect as it contained in the Act
They continue to be rules subordinate to the Act and though for certain purposes including the purpose of construction they are to be treated as if contained in the Act their true nature as subordinate rule is not lost
There is thus at least one decision of this Court which seems to support the view that the orders made by the State Government under sec 2a and sec
31 of the impugned Act could not be called part of the Act this Act does not even say that such orders are to be treated as if enacted in the Act
This is an important aspect of the case and I do not think it can be assumed or taken for granted without further consideration that these orders formed part of the Act and the President s assent 11962 7 L925SlupCI75 586 to the Act cured the repugnancy created by the surcharge order
However as I have already held the Act to be invalid on the other ground
I prefer not to express any concluded opinion on this point
In may judgment the Kerala Essential Articles Control Temporary Powers Act 1961 is invalid on the ground of excessive delegation
I would therefore dismiss the appeals but without any order as to costs
ORDER In view of the decision of the majority
the appeals are allowed and Civil Appeals Nos
1425 2575 2576 of 1972 and 97 1373 and 1374 of 1973 are remanded to the High Court
There will be no order as to costs
P B R 


Summary:
In exercise of powers conferred by s2a of the Kerala Act the State Government declared electricity  as an essential article in 1965
In 1968 the State Government passed an Order called the Kerala State Electricity Supply Kerala State Electricity Board and Licensees Areas Surcharge Order 1968 under s3 of the Kerala Act by which the State Electricity Board was required to collect surcharge from non licensee consumers of electricity even though the Board may have entered into long term contracts with them with regard to the rate at which electricity was to be supplied to them
The respondents who were bulk consumers of electricity questioned before the High Court the validity of the order
The order having been struck down by the High Court in appeal to this Court the respondents supported the judgment of the High Court on the grounds i The Kerala Act is repugnant to the Electricity Act 1910 and the both of which are Central Acts and in particular the latter which falls within Entries 43 and 44 of List I and that the State Act trenches upon the field occupied by the 1948 Act which falls partly under Entry 43 of List I and partly under Entry 38 of List III
On behalf of the appellants it was contended that the Kerala Act falls under Entries 26 and 27 of List II and in any event the Presidential assent to the Kerala Act has cured the repugnancy
Allowing the appeal per majority Alagiriswami Bhagwati Goswami and Sarkaria JJ  HELD The Kerala Act the declaration of electricity  as an essential article under section 2a and the Surcharge Order made under section 3 are valid
581 G 1
The question of repugnance arises only in case both the legislations fall within the same List namely List III
If any legislation is enacted by a State Legislature in respect of a matter falling within List I that will be void
There can therefore be no question of repugnance between the Electricity Act 1910 and the  1948 on the one hand and the Kerala Act on the other if the first two Acts fall in List I or List III and the State Act in List II
562 D Indu Bhushan vs Sundari Devi  referred to
553 2
a The words notwithstanding in clause 1 and subject to in clause 3 of article 246 of the Constitution mean that where an entry is in general terms in List II and part of that entry is in specific terms in List I the entry in List I takes effect notwithstanding the entry in List II
This is also on the principle that the special excludes the general and the general entry in List II is subject to the special entry in List I 563 C b The word notwithstanding also means that if it is not possible to reconcile the two entries the entry in List I will prevail
But before that happens attempt should be made to decide in which List a particular legislation falls
For deciding under which entry a particular legislation falls the theory of pith and substance has been evolved by Courts
If in pith and substance a legislation falls within one list or the other but some portion of the subject matter of that legislation incidentally trenches upon and might come to fall under another List the Act as a whole would be valid notwithstanding such incidental trenching
563 D E c Both the 1910 Act as well as the 1948 Act are existing law as contemplated under article 372 of the Constitution
An existing law continues to be valid even though the legislative power with respect to the subject matter of the existing law might be in a different List under the Constitution from the List under which it would have fallen under the Government of India Act 1935
But after the Constitution came into force an existing law could be amended or repealed only by the Legislature which would be competent to enact that law if  it were to be newly enacted
566 G 3a The Statement of Objects and Reasons though not relevant for the purpose of interpreting the sections of an Act will throw light upon the object of the Legislature from the historical point of view 569 A b The 1948 Act was enacted for the purpose of co ordinated development of electricity in India on a regional basis
The Statement of objects and Reasons states that there was necessity for the constitution of semi autonomous bodies like Electricity Boards to administer grid system on quasi commercial lines
The Act deals with the incorporation and regulation of Electricity Boards
It created a central authority which is not an incorporated body as well as various provincial Electricity Boards which are incorporated bodies
A Provincial Electricity Board located in one Province and operating in a neighbouring Province could carry on its operations by agreement with the other Province or Provinces
The jurisdiction of an Electricity Board however was confined mainly to the jurisdiction of an Province under the Act the executive power vested in the Provinces
The Statement of objects and Reasons further says that the semi autonomous Electricity Boards contemplated under the Act could not be set up by provincial Governments under the then existing constitutional Act as they would be in the nature of trading corporation within the meaning of entry 33 of the Federal Legislative List of the Government of India Act 1935
568A H 4
The argument that the 1948_Act falls under entries 43 and 44 of List I has no substance
568 A a A reading of the Statement of Objects and Reasons shows that the 1948 Act was a legislation under an entry in the Concurrent List
Although the Statement of objectcs and Reasons mentions entry 33 of the Federal List of the Government of India Act 1935 corresponding to entries 43 and 44 of List I of the Seventh Schedule to the Constitution it does not show that the 1948 Act falls under entry 44
Nor is the fact that entry 33 of List I of the Government of India Act 1935 was mentioned in the Statement of objects and Reasons a conclusive test
568 E b From an examination of the provisions of the 1948 Act it would be obvious that one part of the Act deals with the constitution of the Boardthe incorporation of the Board and the regulation of its activities
But the main purpose of the Act is for rationalising the production and supply of electricity
The regulation contemplated in entries 43 and 44 of List I is not regulation of the business of production distribution and supply of electri 554 city of the Corporation
The provision regarding the incorporation and regulation of Electricity Boards should be taken to be only incidental to the provisions regarding production supply and distribution of electricity
Therefore the provisions of the 1948 Act regarding the Board s functions do not make it one falling under entry 43 of List I 570 H 571A R C Cooper vs Union and Ramtanu Housing society vs Maharashtra  followed
c The 1948 Act in pith and substance should be deemed to be one falling under entry 38 of List III
In the Present case the incorporation of the Stage Electricity Boards is merely for the rationalisation of the production and supply of electricity for taking measures conducive to electrical development and for all matters incidental thereto
Furthermore Electricity Boards are not trading corporations they are established to promote co ordinated development of the generation supply and distribution of electricity on a no profit no loss basis
In the discharge of their functions they are guided by directions on questions of policy given by the State Governments
There are no shareholders and there is no distribution of profits
This is another reason why the 1948 Act cannot be said to fall under entry 43 of List I 573 B D d Even assuming that part of the 1948 Act is a legislation with respect to incorporation and regulation of a trading corporation falling under entry 48 of List I of Schedule Seven the rest of it will fall under entry 38 of List III
The Kerala Act has nothing to do with the incorporation and regulation of the Electricity Boards and therefore it can only relate to entry 38 List III if at all
573 F G e The 1910 and 1948 Acts together form a complete code with respect to entry 38 in List III and the Board is only an instrument fashioned for carrying out this object
571 A f Therefore both the 1910 Act and 1948 Act could be amended or repealed by the Parliament and also by the State Legislature if it obtains Presidential assent to an Act amending or repealing the 1910 Act or 1948 Act
566 H A K Krishna vs State of Madras   P N Kaul vs The State of J  K 1959 Supp2 SCR 270 and J  K State vs M section Farooqi   referred to
g The assent of the President should be deemed not merely to the substitution of the words five years by the words seven years in the Kerala Act but to the Act as a whole and any repugnance between the Kerala Act on the one hand and the 1910 Act and 1948 Act on the other should be doemed to have been cured by such assent
The Kerala Act in so far as it deals with electrieity can be deemed to be legislation under entry 38 of List III Though the Act itself has not declared any article as an essential article when the declaration was made under s2a in 1965 it became part of the Act
When the President assented to the Amendment Act of 1967 the declaration of electricity as and essential article had been made and should be deemed to have become a part of the Act
575 F C 5 But the Kerala Act is a matter falling under entries 26 and 27 of List II
575 A a Essential article is a term which has acquired a defining connotation in Indian legislative practice and is not a vague or a general term
Essential commodity defined in the includes practically every matter regarding industry within the legislative competence of Parliament
The term essential commodity is an expression corresponding to a commodity essential to the life of the community
It is not open to the authority exercising powers under s2a of the Kerala Act to declare and any every commodity as an essential commodity
That Act deals with esential articles not being essential article dealth with the by Central Act of 1955
It is not a legislation with respect to electricity and therefore does not fall under entry 38 of List III
Electricity being beyond doubt an essential article may be declared to be an essential article under the Act
In that case the power 555 exercised is not in relation to electricity qua electricity but electricity as an essential article
The Act therefore in pith and substance is with respect to trade and commerce and production supply and distribution of electricity
It is not a permanent legislation with respect to electricity but a temporary one dealing with a temporary situation
574 A F H b The Surcharge order was necessary for the survival and existence of the Board without which there can be no production or supply of electricity
It is no valid criticism of this view to say that the powers of the Board under the 1948 Act are over ridden by the Surcharge order and the order is therefore repugnant to the 1948 Act
The Board was anxious to make no Surcharge order
This is a simple case of a contract being over ridden in exercise of statutory powers
575 B 6a It is not correct to say that in so far as the consequence of a declaration under s2a of the Kerala Act was that the State Government was enabled to make orders regarding production supply and distribution of electricity there was a possibility of such orders being repugnant to the provisions of the 1910 Act and the 1948 Act and therefore any such repugnancy was cured by the assent given by the President
It is only the actual repugnancy that can be cured by Presidential assent and not the possibility of repugnancy
575 G b No Presidential assent was possible to the notification article 2542 does not contemplate Presidential assent to notifications issued under the Act
The Article contemplates Presidential assent only to laws made by the Legislature of a State
567 G 7a Notwithstanding the fact that subordinate legislation is laid on the table of House of Parliament or State Legislature and being subject to such modification annulment or amendment as they may make the subordinate legislation cannot be said to be valid unless it is within the scope of the rule making power provided in the statute
Where an executive authority is given power to frame subordinate legislation within stated limits rules made by such authority if outside the scope of the rule making power should not be deemed to be valid merely because such rules have been placed before the Legislature and are subject to such modification annulment or amendment as the Legislature may think fit
The process of such amendment modification or annulment is not the same as the process of legislation and in particular it lacks the assent either of the President or the Governor of the State
576 E G Minister of Health vs The King and Institute of Patent Agents vs Lockwood referred to
b If a declaration made under section 2a or an order made under s3a is not within the scope of the Act it should be held to be not valid
576 H c A declaration can still be attack if the power to make such a declaration was beyond the scope of the power delegated
even if subsequent to the declaration the Act was amended and the President had given his assent to the to Amending Act577 A d But the power conferred by the Kerala Act is a case of conditional legislation
The various types of powers that can be exercised under that Act are enumerated in it
Only an article with reference to which those powers are to be exercised is left to be determined by the Executive
That will vary from time to time
It is the Exceutive that would be in a position to judge when and under what circumstances an article becomes an essential article and therefore it is necessary
to control the production supply and distribution of trade
and commerce in that article578 H The Queen vs Burah 5 LR178 194 State of Punjab vs Khan Chand  and Gwalior Rayon Mills vs Asst
Commr
ST  followed
556 The Kerala Essential Articles Control Temporary Powers Act 1961 is an invalid piece of legislation on the ground of excessive delegation and the declaration and Surcharge order made respectively under s2a and s3 of that Act are of no consequence582 G 1a The definition of essential article leaves it to the State Government to decide what should be an essential article for the purpose of the Act
The legislature is of course presumed to know the limits of its competence and assuming it is permissible to attribute similar knowledge to the Government as to the bounds of its authority under s2a an essential article may be any article covered by any of the entries in List II or List III except the classes of commodities mentioned as an essential commodity in the 
Until therefore the Government issued a notification under s2a declaring electrical energy to be an essential article almost four years after the Act came into force it was not possible even to guess what the Act was about
Thus the Act as passed had no positive content it was and empty husk and its insubstantiality if by itself not an invalidating factor exposes the want of a declared legislative policy in the Act
The Act does not provide any guidance or lay down any test to ascertain what makes an article essential for the purpose of the Act
The reference to the in s2a which defines essential article is merely to exclude from its purview the commodities covered by the and only serves to emphasise its indefiniteness and makes it more difficult to find any clue to the nature of the articles the Legislature had in mind in enacting the Kerala Act
Almost the entire legislative field was left open to the Government to choose from and decide according to their own lights what should be an essential article
583 C G b The Legislature cannot delegate the essential legislative function which means that the Legislature must declare the policy of the law and provide a standard for the guidance of the subordinate law making authority
The Kerala Act authorises the Government to declare any article as essential except those mentioned in the without laying down any definite criteria or standards
This is surrendering unguided and uncanalised power to the executive
The Act cannot be called an instance of conditional legislation
The powers conferred on the Government by the Kerala Act exceed the limits of permissible delegation
583 H c The Kerala Act of 1961 was to remain in force for a period of five years from January 1962
The Principal Act as well as the Amending Acts of 1967 1969 and 1970 received the assent of the President
But the Act as passed in 1961 did not appear to contain any provision which was repugnant to any Central Act or existing law that being so the assent given to it seems redundant and of no consequence
Article 2542 contemplates an existing repugnancy and not possible future inconsistencies
Obiter Assuming that assent given by the President to the amending Acts would have the effect of curing the repugnancy between the declaration under s2a and the Surcharge Order under s3 of the principal Act on the one hand and the Central Acts of 1910 and 1948 on the other If the declaration and the Surcharge Order were outside the Actcould not cure the repugnancy arising from these two orders584 H The orders made by the State Government under s2a and s31 of the impugned Act could not be called part of the Act
The Act did not even say that such orders were to be treated as if enacted in the Act
The President s assent could not be said to have cured the repugnancy created by the Surcharge order
585 G Arguments for the appellant The impugned Kerala Act is a legislation under Entry 26 of List II Trade and Commerce
It may also fall under Entry 27 List II Production Distribution and Supply of Goods
Assuming that the Electricity Supply Act falls under Entries 43 andor 44 of List I the State Legislature is competent 557 to pass legislation relating to the trading and commercial activities of the Corporation set up under the Central Act passed under Entry 43 andor 44 of List I Assuming that the Kerala Act encroaches on the powers of the Electricity Board under s49 such encroachment is incidental and is justified under the doctrine of pith and substance
Assuming that the Central legislation as well as the State legislation falls under Entry 38 of List III there is no repugnancy or conflict between the powers of the Board under s49 and the impugned Act and the orders because they are made within the provisions of the Act and to aid and support the powers of the Board
If the surcharge had not been introduced the Electricity Board would not have been able to carry on the business and would have been compelled to close down its business
Arguments on behalf of Electricity Board The Act applies to essential commodities ie all essential commodities as understood at the time of legislation in 1962
In view of the programme of industrialisation and the limited scope of the Central  the present Act was conceived
The background of the Act strongly indicates the content of the expression essential commodities  as meaning the same thing as essential to the life of the community
Under the impugned Act by s2a the power to select the articles for control is delegated to the State Government
The power to take orders for control is delegated both to the State Government and authorised officers
The articles falling within the Central are excluded from the purview of the Act not because control of those articles is not desired but because the State Government have the necessary powers under the Central Act itself
The definition in s2a should be understood to mean essential articles notified by the State Government and essential articles should be understood as those which are essential to the life of the community
The word control  in the preamble is indicative of the limited scope of the Act
This interpretation saves the Act from the vice of abdication of essential legislative function by the Legistature
The preamble to the Act is a key note to the understanding of an Act as well as the Statement of Objects and Reasons clearly indicates the scope and purpose of the Act
Trade and Commerce as well as supply and distribution must be in respect of articles or goods but on that account it will not be permissible to dissect the Act and make it relatable to each commodity over which control is imposed
The pith and substance of the Act makes them fall within List II Entries 26 and 27
The law is not a law relating to electricity as such nor relating to the incorporation or power of the Electricity Board established under the Electricity Supply Act 1948
The Supply Act 1948 as clearly expressed in the preamble and worked out in the Act through several agencies including the Board shows that the pith and substance of the Act is development of electricity and falls within List III Entry 31 of the Government of India Act
The incorporation of State Electricity Board for each State is only one of the means of achieving the objective
Moreover the Board is not a trading Corporation since it is not created to earn profits but to carry out development and supply energy at the most economical rate
Each Board is established by a State
The whole law falls in the Concurrent List and in any event not under List I Entry 43 because the Board is not a trading corporation nor does it fall under Entry 44 because the Board is a State Board for the State
The Supply Act was passed under the Government of India Act 1935 and was an existing law and not an impediment to the State passing a law within its competence
There is no conflict between the impugned notification and the exercise of powers of the Board under s40 of the supply Act
Assuming that both the legislations fall under List III the President s assent to the impugned Act was operative the conflict was immaterial
558 Arguments for the respondent The Electricity Supply Act of 1948 is relatable partly to List I entry 43 and 44 Government of India Act List I Entry 33 and partly to List III Entry 38 Government of India Act List III Entry 31
Part of the Act is concerned with the constitution and powers of the Electricity Board which is something like the memorandum and Article of a Limited Company and another part of the Act may be said to be concerned with electricity
The Kerala Act is a vague piece of legislation
The Articles to which this Act may apply are not mentioned
It is only after the power under the Act is exercised that it is possible to say whether it would conflict with any other legislation
The impugned Act may be applicable to Articles relatable to as many as 20 legislative entires from List I II and III at the discretion of the Government
Regulation and Control with regard to many of the matters are covered by existing Central Acts such as Industries Regulation and Development Act Factories Act Central Excise and Salt Act Defence of India Act  Electricity Supply Act 1948
Every aspect of electricity in respect of generation control price fixation must be relatable to entry 38 of List I and not Entry 26 or 27 of List II
The Central Legislature has already legislated on all these aspects in the of 1910 and Supply Act 1948
If these were the subject matter of Entries 26 and 27 of List II the Central Legislature could not have legislated
Any argument on the basis that the Electricity Supply Act 1948 is existing law is not relevant because the 1948 Act has been extensively amended in 1956 and 1966 and these amendments relate to the field of control under the Kerala Act if the same is applied in respect of electricity
The Presidential assent given to the Kerala Act could be said to be an assent within the meaning of Article 254 since at the time when the assent was given the Act did not disclose any inconsistency with any Central Act since the items to which the Kerala Act was applicable did not appear in the statute
The conflict arose only when an order was made by the State Government applying the Act to electricity
No steps were even taken to incorporate in the Act the commodities to which the Act could apply and to take President s assent thereon
The Kerala Act suffers from excessive delegation because at the will of the State Government the Act could be made applicable to any article except those covered by the 
The State Government could apply the Act even to items falling in List I since there is no guideline