ICDS - A delegated legislation gone too far? Legal Eagle Harish Salve's take
Our popular series ' Tax Nostalgia ' has, over the last 41 weeks, seen tax stalwarts mesmerizing us with their take on yesteryear judgments, many of them that still hold fort. The most recent one, by tax expert Mr. Yogesh Thar, made a forceful argument on how ICDS, which has come in via 'delegated' legislation, may be susceptible to a legal challenge. Mr. Thar, examines the constitutional validity of ICDS, a "delegated legislation". Taking the readers through the concept, scope and limitation of “delegated legislation”, he beautifully summarizes the same in the following words - “..Delegated legislation results in transfer of legislative power to executive wing, hence whether there has been excessive delegation of powers or not has been subject matter of judicial interpretation for decades.” Analyzing several judgments of the apex court in this regard, he finally opines - " However, what is the underlying principle to be followed by the Central Government in framing the Standards is nowhere stated in section 145(2)..... Is this not a clear case where the Court can interfere to strike down the powers conferred under section 145(2) since no policy is discernible at all and the delegation is of such an indefinite character as to amount to abdication? "
When Taxsutra contacted legal eagle and Sr. Advocate Harish Salve for his take, we got this view from the most sought after lawyer in India - " His ( Mr. Thar ) arguments against the standard may be compelling – but the understanding of powers of delegated legislation are not correct. The later judgments of the Supreme court – if I remember correctly – in the Birla mills [7 judges] and the judgments that followed have hugely expanded the power of delegation. Unfortunately the judiciary has let go of control over delegated legislation in the field of taxation. Interesting reading – keep up the good work. "
The jury is still out and it might be just a matter of time before Courts are called to step in and set the doubts at rest.