Chagla, C.J.
1. Four issues relating to jurisdiction have been raised on the summons for judgment taken out by the plaintiff, and they have now come before us for decision.
2. The suit in which these issues arise was filed for recovering a sum of Rs. 11,704-5-4, and the main question that we have to consider is whether in view of the notification issued by the Government on 20th January 1950, this Court has jurisdiction to try this suit.
3. In order to understand and appreciate the contentions raised before us it is necessary to look at the Bombay City Civil Court Act (Bom. Act XL [40] of 1948). That Act was passed by the Bombay Legislature in order to establish an additional Civil Court for Greater Bombay, Section 3 of that Act deals with the constitution of the new Court and provides that:
'The Provincial Government may, by Notification in the Official Gazette, establish for the Greater Bombay a Court, to be called the Bombay City Civil Court. Notwithstanding anything contained in any law, such Court shall have jurisdiction to receive, try and dispose of all suits and other proceedings of a civil nature not exceeding ten thousand rupees in value, and arising within the Greater Bombay, except suits or proceedings which are cognizable...'
Then follow the four sub-clauses which exempt from the jurisdiction of the City Civil Court suits mentioned in these four sub-clauses. Then there is a proviso enabling the Provincial Government, from time to time, after consultation with the High Court, by a like notification to extend the jurisdiction of the City Court to any suits or proceedings of the nature specified in Clauses (a) and (b) of that section. Then we come to Section 4 which provides that :
'Subject to the exceptions specified in Section 3, the Provincial Government may, by notification in the Official Gazette, invest the City Civil Court with jurisdiction to receive, try and dispose of all suits and other proceedings of a civil nature arising within the Greater Bombay and of such value not exceeding twenty-five thousand rupees as may be specified in the Notification.'
Pursuant to the powers which the Provincial Government thought it had under Section 4 of the Act, the Provincial Government issued a notification on 20th January 1950, and the notification was to this effect : The notification sets out the power conferred upon the Government under Section 4 of the Act and then proceeds to invest, with effect from and on the date of the notification, the City Civil Court with jurisdiction to receive, try and dispose of all suits and other proceedings of a civil nature not exceeding twenty-five thousand rupees in value, and arising within the Greater Bombay subject, however, to the exceptions specified in Section 3 of the said Act.
4. Sir Jamshedji contends in the first instance that Bombay Act XL [40] of 1948 is ultra vires the Provincial Legislature. The same contention came up before this Court in another proceeding Mulchand Jagtiani v. Raman Shah 51 Bom. L. R. 86 : A. I. R. 1949 Bom. 197 and it was held by this Court in that case that the Act was intra vires the Bombay Legislature.
5. The further contention that has been raised is that Section 4 of the Act is ultra vires the Provincial Legislature. Sir Jamashedji's contention is that by Section 4 the Legislature has delegated its legislative powers to another authority and has given the right to the Provincial Government to invest the City Court with jurisdiction from ten thousand to twenty-five thousand rupees, a power which the legislature alone can exercise, and in conferring such power under Section 4 it has acted outside its powers. Now there can be no doubt that a Legislature can appoint a subordinate agency to carry out certain kinds of work which it would be impossible for the Legislature itself to attend to. As the affairs of the State get more and more complicated and complex it would be quite impossible for the Legislature to attend to every detail which may arise in the coarse of its legislative functions. It would be impossible for it to visualise various circumstances that may also arise in the course of the working out of its policy. Therefore, it would be open to the Legislature to appoint a subordinate agency and confer upon it certain powers. These powers need not be wholly administrative. They may be even legislative in character. The narrow question that we have to decide is, what is the limit which must be set upon the legislative powers which a Lagislature can confer upon a subordinate agency which it sets up. It is clear, and I shall presently refer to the authorities, that the Legislature cannot abrogate its legislative functions. It cannot efface itself and set up a parallel legislative authority. It cannot delegate, its legislative functions; it must be the sole authority to lay down the policy of the law and to enact the general principles which should be embodied in the legislation which is placed on the statute book. But to the extent that its policy had to be carried out in details and in particulars, is may leave to a subordinate authority or agency the task and function of doing so. It can never be open to such subordinate authority or agency to lay down any legislative policy; that would be for the Legislature to abrogate its functions. Now this delegation of power which may be exercised by a subordinate agency or authority at the instance of the Legislature hag been characterised by different names; it has been called conditional legislation; it has been called subsidiary legislation; it has been called subordinate legislation. On the other hand, the main legislative function if left to a subordinate agency has been characteriaed as delegated legislation; and the authorities lay down that whereas a Legislature may permit another authority to legislate to the extent the legislation is conditional, or subsidiary, or subordinate, it cannot permit any other authority to legislate what is delegated legislation. Now, in this case under the Government of India Act, 1935, we have legislative lists in Schedule 7 to that Act and these lists contain the subjects which can be legislated upon by the Central Legislature, and the Provincial Legislature and there is a concurrent list where both the Central and the Provincial Legislatures can legislate upon the subjects mentioned in that list. Turning to List II, the Provincial Legislative List, Item 2 relates to the jurisdiction and powers of all Courts except the Federal Court, with respect to any of the matters mentioned in that list. Therefore, it is for the Provincial Legislature to legislate with regard to the jurisdiction and powers of the Courts in respect of any matters which fall in that list. We also find that in List III, Item 15, power has been conferred upon both the Legislatures to pass legislation with regard to jurisdiction and powers of all Courts except the Federal Court with respect to any of the matters in that list. Therefore, it is clear that to the extent that jurisdiction and power has to be conferred upon any Court the Provincial Legislature in passing legislation is exercising legislative power which is conferred upon it by Lists II and III, Government of India Act, 1935, and it is clear that that legislative power cannot be transferred by the Provincial Legislature to any other authority. After the Legislature invests a particular Court with a particular jurisdiction, it would be open to the Legislature to leave to any authority or agency to determine the time and the manner in which that jurisdiction should be exercised by that Court; but the power to invest the Court with the particular jurisdiction can only be exercised by the Legislature, and that power cannot under any circumstances be delegated to any other authority or agency. The question that we have to consider on the construction of the Bombay City Civil Court Act is whether the Legislature has conferred jurisdiction up to twenty-five thousand rupees upon the City Civil Court or whether it has left it to the Provincial Government to confer such jurisdiction on the City Court. Now, looking at the Act from this point of view Section 3 is the section which confers jurisdiction upon the City Court and that jurisdiction, to the extent it is a pecuniary jurisdiction, is not to exceed ten thousand rupees. It is true that the Provincial Government has been given the authority to set up the Court by a notification, but that is merely leaving to the Provincial Government to determine the time when the Court should be set up. The Legislature has exercised its judgment and volition in bringing the Court with a certain jurisdiction into existence and it leaves it to the Provincial Government to carry out its policy at a time to be determined by the Provincial Government. When we turn to Section 4 we find that in clear and unmistakable terms the Legislature has transferred the power to the Provincial Government to invest this very Court with a jurisdiction which may extend up to twenty-five thousand rupees. As far as this additional or increased jurisdiction is concerned, the Legislature has not applied its mind or judgment to the question at all. It has left the legislative function and power to the Provincial Government. The expression used in Section 4 viz., 'invest' is very significant. It can only mean, and does mean, than the power of conferring of jurisdiction upon the City Court between ten thousand rupees and twenty-five thousand rupees has been expressly transferred to the Provincial Government. Now, this is the very legislative function which the Legislature alone can discharge and the Legislature instead of discharging that function leaves it to the Provincial Government to discharge it at such time and in such manner as it thinks proper. The difference between Section 3 and Section 4 is marked and striking. Under Section 3 the Legislature itself sets up a Court with a particular pecuniary jurisdiction. Under Section 4 the Legislature does not invest the Court with any higher jurisdiction but leaves it to the Provincial Government to exercise the function which the Government of India Act lays down should be exercised by the Provincial Legislature. The Advocate-General wants us to read Sections 3 and 4 together. According to him when we read these two sections together the effect is that the Legislature has set up the City Civil Court whose jurisdiction is to be twenty-five thousand rupees; in the first instance its jurisdiction is to be ten thousand rupees as provided by Section 3 and that jurisdiction is capable of being increased to twenty five thousand rupees under Section 4 when the Provincial Government issues a notification under that section. Therefore according to the Advocate-General it is the Legislature which has conferred the jurisdiction up to twenty-five thousand rupees upon the City Civil Court and that increased jurisdiction is not being conferred by the Provincial Government. In my opinion, looking at the plain grammatical meaning of both the sections, it is impossible to accept that contention. I am conscious of the fact that it is the duty of the Court to lean towards holding a piece of legislation passed by the Legislature as a valid piece of legislation rather than the contrary. I am also conscious of the fact that an Act must be construed in a manner which would reconcile its different sections, but with the best of intentions in the world I do not see how it is possible to read Sections 3 and 4 together so as to come to the conclusion for which the Advocate General contends. To my mind it is patent that the Legislature never applied its mind to the question as to whether the new Court which it was setting up should have jurisdiction higher than that of Rs. 10,000. It never passed any judgment on that question. It never laid down any policy with regard to that question and Section 4 is not a section which merely directs the Provincial Government to carry out the policy laid down by the Legislature, and to work out the details with regard to a policy which the Legislature has laid down; but it is a section which confers upon the Provincial Government the power to confer jurisdiction upon the Court, or in other words, it is a section which entitles the Provincial Government to lay down its policy as to whether the new Court should have the increased jurisdiction up to twenty-five thousand rupees. I do not think it is possible to argue that the Provincial Legislature had the authority to divest itself of its rights and powers under the Government of India Act, 1935, to lay down the policy with regard to the jurisdiction of the Court and delegate that power to the Provincial Government or to any other authority or agency.
6. The principle of law with regard to delegated legislation was first enunciated by their Lordships of the Privy Council in The Queen v. Burah 6 I. A. 178 : 4 Cal. 172 . In that well-known case their Lordships first enunciated the principle that a Legislature was sovereign within the ambit of its own powers. They went on to consider the question of delegation of legislative power, and the question that they had to consider was whether Section 9 of Act XXII of 1869, which conferred upon the Lieut.-Governor of Bengal the power to determine whether the Act or any part of it shall be applied to certain districts was ultra vires the Legislature, and in order to decide it they had to consider whether that section was a conditional legislation or a delegation of legislative power. Their Lordships agreed that the Legislature could not, by any form of enactment, create and arm with legislative authority, a new legislative power not created or authorised by the authority under which the Legislature itself was functioning. In their Lordships' opinion the Legislature had determined that it was expedient to leave the time, and the manner, of carrying out into effect the policy of Legislature to the Lieut.-Governor. Further, the territorial extension of the Act was also left to the Lieut. Governor looking to the circumstances and conditions which prevailed in the different parts of the Province. Their Lordships were at pains to point out at p. 195 that the proper Legislature had exercised its judgment as to place, person, laws and powers; and the result of that judgment had been to legislate conditionally as to all those things; and the conditions having been fulfilled, the legislation was then absolute. They further point out that when a Legislature has plenary powers it may legislate either absolutely or conditionally and the legislation conditional on the use of particular powers, or on the exercise of a limited discretion entrusted by the Lagislature to persons in whom it places confidence is no uncommon thing; and in many circumstances it may be highly convenient.
7. 29th March 1950--It must be noticed that their Lordships emphasize the fact that only a limited discretion can be entrusted by the Legislature and not an absolute discretion. When we turn to the impugned legislation before us, whereas in Section 3, only a limited discretion is given to the Provincial Government to bring the new Court into existence the jurisdiction of which has already been decided up on by the Legislature, under Section 4, it seems to me that an absolute discretion is given to the Provincial Government whether or not to increase the jurisdiction of the Court from ten thousand rupees to twenty-five thousand rupees.
8. There is also a decision of the Federal Court which had to consider the same question as we are considering. That is the case of Jatindra Nath v. Province of Bihar . In that case Section 1(3), Bihar Maintenance of Public Order Act (V [5] of 1947) provided that the Act was to remain in force for a period of one year from the date of its commencement, with a proviso laying down that the Provincial Government may, by notification, on a resolution passed by the Bihar Legislative Assembly and agreed to by the Bihar Legislative Council, direct that the Act shall remain in force for a further period of one year with such modifications, if any, as may be specified in the notification. The question was whether the Bihar Legislature could enact the proviso in question, thereby leaving it to the Provincial Government to extend the life of the legislation and also to introduce modifications in the legislation. The Federal Court came to the conclusion that the proviso was ultra vires the Bihar Legislature and the Act came to an end at the end of one year which was the period laid down by the Legislature. Kama C. J. in his judgment points out that (p 178) :
'The power to extend the operation of the Act beyond the period mentioned in the Act prima facie is a legislative power. It is for the Legislature to state how long a particular legislation will be in operation. That cannot be left to the discretion of some other body. The power to modify an Act of a Legislature, without any limitation on the extent of the power of modification, is undoubtedly a legislative power.'
Mahajan J. in a concurring judgment stated that the proviso which had been attacked came within the ambit of delegated legislation and was thus an improper piece of legislation and void. According to the learned Judge it not only amounted to abdication of legislative authority by the Provincial Legislature, but also it went further and amounted to setting up a parallel Legislature. Mukherjea J., also in a concurrent judgment drew attention to the settled maxima of constitutional law that the power conferred on legislative authority to make laws could not be delegated by it to any other body or department, and the authority must remain where it it was located, and the power, to which the prerogative had been entrusted, could not relieve itself from the responsibility by choosing other organs, upon which it should be devolved. Then he pointed out certain well recognised exceptions, more apparent than real, which had been engrafted upon that maxim, and he referred to one exception, that the legislation itself may be conditional and not absolute and its taking effect may be made to depend upon determination of facts and conditions by an outside authority. He further pointed out that the Legislature could not delegate its power to make law, but it could make a law to delegate a power to determine some fact or state of things upon which the law made or intended to make its own action depend. He further pointed out that the inhibition against delegation did not also preclude the Legislature from delegating any power not legislative which is could itself rightly exercise. Thus the Legislature might authorise another to do something which did not involve law-making as a matter of advantage or convenience although if it so liked it could do that thing itself.
9. The Advocate-General has urged that the Federal Court was largely swayed by the fact that the proviso to Section 1 (3) of the Bihar Act permitted the Provincial Government to modify the Act passed by the Legislature and that in effect amounted to re-enacting the piece of legislation. But the learned Chief Justice in his judgment clearly points out that even if the proviso was restricted to extending the life of the legislation, it would still have been ultra vires the Legislature.
10. Then I should like to refer to a judgment of the Madras High Court which is a considered judgment and where most of the authorities bearing on the point have been carefully marshalled and reviewed. That is the decision in In re Veerabhadrayya, : AIR1950Mad243 . There also the question was whether a power conferred upon a Provincial Government to extend the duration of the Madras Maintenance of Public Order Act I [1] of 1947 was intra vires the Legislature, and the Madras High Court held that it was not. In doing so they applied two tests which they set out at p. 248 of the judgment. The first test is taken from Crawford on Statutory Construction, at p. 25, and that test is :
'As a general rule, it would seem to be the nature of the power rather than the manner in which it is exercised by the administrative officer which determines whether the delegation is lawful.'
The other test is taken from an American decision and that is :
'The true distinction, therefore, is between the delegation of power to make the law which necessarily involves a discretion as to what it shall be and conferring authority or discretion as to its execution to be exercised under and in pursuance of the law. The first cannot be done. To the latter no valid objection can be made.'
11. Reference may also be made to a recent Privy Council decision, Emperor v. Benoari Lal Sarma , where the question that the Privy Council had to consider was whether an Ordinance made and promulgated by the Governor General for the purposes of setting up Special Criminal Courts was a valid Ordinance. Provision was made in the Ordinance for setting up of Special Courts when necessary, with special Judges and Special Magistrates, and for the respective limits of jurisdiction and procedure, together with restrictions on appeal. There was also provision in the Ordinance by which it was left to the Local Government, or to some officer of the Local Government empowered by it in that behalf, to direct what offences or classes of offences and what cases or classes of cases should be tried by the Special Courts. Challenge was made to this part of the Ordinance on the ground that the Governor-General could not delegate to the Local Government the choice of Courts. Dealing with the point Viscount Simon, who delivered the judgment of the Judicial Committee, emphasized the fact that what was done by the Ordinance was not delegated legislation at all. It was merely an example of the not uncommon legislative arrangement by which the local application of the provision of a statute was determined by the judgment of a local administrative body as to its necessity. Therefore, it is clear that if the Legislature passes law and lays down its policy, the application of that law to a particular territory may be left to the discretion of the executive; and what is more even the time at which that Act should come into force may also be left to the discretion of the executive. The policy is already determined and because of convenience and of administrative experience which the executive has the Legislature may well think fit to leave it to the executive to determine the time when a particular enactment should come into force.
12. I should like to refer briefly to some English cases which were cited at the bar. The first is the case of Russell v. The Queen 1882 A. C. 829 : 61 L. J. P. C. 77. This was a judgment of the Privy Council in an appeal from Canada and the impugned legislation was the Canada Temperance Act, 1878, and what was contended was that the Canadian Parliament could not delegate the power to bring into force the prohibitory and penal provisions of the Act to a majority of the electors of counties and cities. This contention was rejected by the Privy Council and the answer that their Lordships gave was that the Act did not delegate any legislative powers whatever. They further pointed out that the Act contained within itself the whole legislation on matters with which it dealt, and the provision that certain parts of the Act should come into operation only on the petition of a majority of electors did not confer on those persons power to legislate. Parliament itself enacted the condition and everything which was to follow on the condition being fulfilled. Conditional legislation of that kind was in many cases convenient and was certainly not unusual, and the power so to legislate could not be denied to the Parliament of Canada, when the subject of legislation was within its competency.
13. The next case was Hedge v. The Queen (1883) 9 A C. 117 : 53 L. J. P. C. 1. The Act which the Privy Council was considering in this case was the Liquor License Act, 1877, passed by a Legislature in Canada. Power was given under that Act to a Board of Commissioners to enact regulations relating to the good government of tavarns, etc. and also to create offences and annex penalties for breach of regulations to be made by the Boards. This provision was attacked as being in the nature of delegated legislation. In dealing with the argument, at p. 132, their Lordships point out the true character and position of the Provincial Legislature. They then go on to say (p. 132);
'Within these limits of subjects and area the local Legislature is supreme, and has the same authority as the Imperial Parliament, or the Parliament of the Dominion, would have had under like circumstances to confide to a municipal institution or body of its own creation authority to make by-laws or resolutions as to subjects specified in the enactment, and with the object of carrying the enactment into operation and effect.'
They further point out that such authority was ancillary to legislation and that without its assistance it would be impossible to deal with varying details, and the machinery to carry them out might become oppressive, or absolutely fail. Then their Lordships deal with the argument at the bar that a Legislature committing important regulations to agents or delegates effaces itself. Their Lordships stated that that was not so and it retained its powers intact, and could, whenever it pleased, destory the agency it had created, and set up another, or take the matter directly into its own hands. How far it should seek the aid of subordinate agencies, and how long it should continue them, were matters for each Legislature, and not for Courts of law to decide. Therefore, it is clear from this judgment that it is open to a sovereign Legislature, as our Legislature undoubtedly is, to create an agency for the object of carrying the enactments which it has passed into effect. It may also create agencies which are ancillary to legislation and which may also help it to deal with the various details and machinery which may be necessary to set up in order to carry out legislation; but it is not open to the Legislature to efface itself and to substitute in its place another authority with co-ordinate power.
14. The last case to which I would like to refer is The Initiative and Referendum Act, In re (1919) A. C. 935 : A. I. R. 1919 P. C. 145. That was again a case from Canada, and the Privy Council was considering the Initiative and Referendum Act, and they held the Act invalid because it would compel the Lieut. Governor to submit a proposed law to a body of voters totally distinct from the Legislature of which he was the constitutional head, and would render him powerless to prevent it from becoming an actual law if approved by those voters. At p. 945 their Lordships say :
'No doubt, a body, with a power of legislation of the subjects entrusted to it so ample as that enjoyed by a Provincial Legislature in Canada, could, while preserving its own capacity intact, seek the assistance of subordinate agencies, as had been done in Hodge v. The Queen (1883) 9 A. C. 117 : 53 L. J. P. C. 1, the Legislature of Ontario was held entitled to entrust to a Board of Commissioners authority to enact regulations relating to taverns; but it does not follow that it can create and endow with its own capacity a new legislative power not created by the Act to which it owes its existence.'
These decisions make it perfectly clear to my mind that it is not open to a Legislature supreme and sovereign as it may be within its own province, to delegate to any authority the power of legislation which has been entrusted to it under the Constitution. It is solely the privilege of the Legislature to make laws. In exercising that privilege it may entrust subordinates and agents with the power to carry out its policy and to give effect to the legislation, but the subordinates and agents must act within the policy laid down by the Legislature. It cannot create a parallel or alternative law-making authority.
15. Now, applying once more these tests to the City Civil Court Act we find that the Legislature in the exercise of its legislative power has set up a civil Court with a limited jurisdiction under Section 3 of the Act. It has not set up a Court with a jurisdiction higher than ten thousand rupees. Having set up a Court of limited jurisdiction it has given to the Provincial Government under Section 4 the power to confer upon that Court a higher jurisdiction up to twenty-five thousand rupees. Now, this power which is conferred upon the Provincial Government is a power which could only have been exercised by the Legislature itself. What is left to the Provincial Government is not the carrying out of any details in deciding upon the territorial application of the Act nor fixing the time when the Act should come into force; but the power itself of legislation, which, under the Government of India Act, the Provincial Legislature alone could exercise, viz., conferring jurisdiction upon the Courts.
16. I should also like to point out the very great distinction that exists in constitutional law between the powers of Imperial Parliament and the powers of Provincial Legislature under the Government of India Act. The Imperial Parliament is supreme and sovereign in a sense higher than the Provincial Legislature. It possesses wider powers than the Provincial Legislature, and one of its attributes is that it can create law making bodies which can pass laws which the Parliament itself can make. That attribute is not possessed by the Provincial Legislature. Therefore, supreme and sovereign within its own province though the Provincial Legislature may be, it is still a creature of the Government of India Act and under that Act its jurisdiction is confined to making of laws with regard to subjects contained in Schedule 7. It has no power to permit any other authority to pass those laws, or, in other words, it cannot delegate its own function of law making to any other agency or authority. Under the circumstances, in my opinion, Section 4 is ultra vires the Provincial Legislature inasmuch as it has purported to delegate to the Provincial Government the power to invest the City Court with a jurisdiction exceeding ten thousand rupees already conferred upon it by Section 3 of the Act. If that be so, the notification issued by the Government in pursuance of that section on 20th January 1950, is invalid and can be of no effect. The result is that the City Civil Court has not been validly invested with jurisdiction beyond the pecuniary jurisdiction of ten thousand rupees, and, therefore, the jurisdiction to receive, try and dispose of suits and other proceedings of the value of over ten thousand rupees continues to remain vested in this High Court.
17. Per Curiam.--As we had given leave to the defendant limited to the question of jurisdiction and as we have now held that this Court has jurisdiction to try the suit, the summons for judgment will go back to the learned Judge taking miscellaneous matters to dispose it of on merits. No order as to costs.
18. Certified that this decision involves a substantial question of interpretation of the Government of India Act, 1935.