Case Analysis: Atlas Cycle Industries Ltd. v. State of Haryana

This article has been written by Shreyansh Bhansali, pursuing B.A. LL.B (Hons) from Institute of Law Nirma University, Ahmedabad. The present article is a case analysis of Atlas Cycle Industries Ltd. v. State of Haryana.


“Legislation is either supreme or subordinate, the former proceeds from sovereign and the later from any other authority –Salmond”


What is Delegated Legislation?

Delegated legislation (also referred to as secondary legislation or subordinate legislation or subsidiary legislation) is law made by an authority under forces given to them by primary legislation so as to actualize and direct the necessities of that primary legislation.


It is law made by an individual or body other than the legislature however with the assembly's legislative authority. Regularly, a legislature passes resolutions that set out wide blueprints and standards, and representatives power to a delegates authority to issue appointed enactment that tissue out the subtleties (meaningful guidelines and substantive regulations) and give methods to executing the considerable arrangements of the rule and considerable guidelines (procedural guidelines).


Delegated legislation can likewise be changed quicker than primary legislation so governing bodies can assign and delegate issues that may be tweaked through understanding and experience. The Indian Constitution recognises subordinate legislation by delegation. Article 13(3) gives that "law" incorporates any mandate, request, bye-law, rule, guideline, notice, customs, or uses having in the domain and territory of India the power of law.


It is the Legislature's essential obligation to control and screen the activity of appointed authority by the executive authorities. A parliamentary review of the approved legislation happens in three stages. This is otherwise called the Laying Procedure or 'Laying on the Table'.


This serves to advise the assembly regarding what all principles were defined by the authorities during the time process of legislation. Moreover, this gives a stage for legislators to address or challenge the principles that have been made or proposed. A provision as to "laying" might be "directory or mandatory".


It will rely on the plan of the Act, the language utilized, results counted in the pertinent law and different contemplations. In Atlas Cycle Industries Ltd. v. State of Haryana, the Supreme Court thought about this viewpoint in subtleties and saw that the utilization of "shall" isn't convincing or conclusive of the issue and the court needs to find out in the purpose of the legislature which is the assurance factor.


Facts of the case

The Development Officer of the Directorate-General, Technical Development, New Delhi, carried out a spot review of the balance sheet of the appellant on 29th December 1964, it was discovered that from the date 1st January 1964 till 12th January 1965, the company had purchased around 60.03 tons of black plain iron sheets from multiple suppliers at a higher rate than the maximum permissible rate which is set by the Iron and Steel Controller which is an authority conferred by Iron and Steel Control Order, 1956.


The special magistrate charged the appellants under Section 120B of Indian Penal Code read with Section 7 of the Essential Goods Act and Section 7 read with Section 15(3) on the Iron and Steel Control Order. The appellant applied under Section 251 of the Code of Criminal Procedure pleading that the notification from the government which had set the maximum price was not put before the parliament and therefore was not valid, the Iron and Steel Control Order, 1956 was also vied to be a nullity, this application was rejected by the Trial Court.


The appeal in the High court was rejected under the grounds that the said order was valid because the legislature never intended that the order will be invalid if the order is not in accordance with Section 3(6) of Essential Commodities Act which said that non-laying of the notification before the Houses of Parliament will not be the motive for nullification of the notice. Moreover, it was even expressed that Section 3(6) of the Essential Commodities act say that any order issued will be presented in both the houses, here it is critical to comprehend whether the arrangement being referred to is "directory or mandatory" in nature, additionally the utilization of "Shall" isn't indisputable and the legislature interpretation must be deciphered by the court.


The High Court alluded to two grounds on which the provision is a directory in nature: