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In Municipal Corporation of Delhi v. Birla Cotton, Spinning and, Weaving Mills Delhi & Anr.(3) this Court dealt with the provisions of sections 113 and 150 of the Delhi Municipal Corporation Act in the context of levy of certain taxes, including tax on consumption or sale of electricity. One of the questions which arose for determination in that case was with section- 150, of the above mentioned Act transgressed the limits of permissible delegation. According to that section, the Municipal Corporation may at a meeting pass a resolution for the levy of any of the taxes specified in sub-section (2) of section 113 defining the maximum rate of tax to be levied, the class or classes of persons or the description of articles and properties to be taxed, the system of assessment to be adopted and the exemptions. if any, to ranted. Such a resolution has to be sanctioned by the Central Government and thereafter the Corporation has to pass a second resolutions determining subject to the maximum rate, the actual rate of tax. Wanchoo CJ., Hidayatullah, Sikri, Ramaswami and Shelat JJ. upheld the validity of the above section, while Shah and Vaidialingam JJ.. dissented and held that section 150(1) of the; Act was void because of excessive delegation of legislative authority to the Corporation. Wanchoo CJ. and Shelat J. on a consideration of the various of the Act held that the power conferred by section 150 on provisions ration was not unguided and could not be said to amount to excessive delegation. After referring to the earlier authorities, Wanchoo CJ. speaking for himself and Shelat J. observed :

After referring to the provisions of the Delhi Municipal Corporation Act, Shah and Vaidialingam JJ. held that the delegation could not be upheld merely because of the. special status, character, competence or capacity of the delegate or by reference to the provisions made in the statute to prevent abuse by the delegate of its authority. Shah and Vaidialingam JJ. accordingly came to the conclusion that Section 150(1) was void as it permitted excessive delegation of legislative authority to the Corporation.

As a result of the above, we hold that section 8 (2) (b) of the Central Sales Tax Act does not suffer from the vice of abdication or excessive delegation of legislative power. The appeals fail and are dismissed with costs. One hearing fee.

MATHEW, J.-These appeals are preferred on the basis of certificates granted by the High Court of Madhya Pradesh under article 133 (1) (c) of the Constitution from a common judgment of that Court holding that the provisions of s. 8 (2) (b) of the Central Sales Tax Act, 1956 (hereinafter referred to as the Act) do not suffer from the vice of excessive delegation and are therefore immune from attack on the ground that Parliament has abdicated its essential legislative function in enacting them.

In Municipal Corporation of Delhi v. Birla Cotton and Spinning and Weaving Mills(3), the main question was about the constitutionality of delegation of taxing powers to Municipal Corporations. The Delhi Municipal Corporation Act (66 of 1957), by S. 113(2) had empowered the Corporation to levy certain optional taxes. Under s. 150, (1) [1966] 1 S.C.R. 950. (2) [1967] 3 S.C.R. 557. (3) [1968] 3 S.C.R. 251.

power was given to the Corporation to define the maximum rate of tax to-be levied, the classes of persons and the description of articles and property to be taxed, the system of assessment to be adopted and the exemptions, if any, to be granted. The majority of the Court held the delegation to be valid. Wanchoo C.J. observed that there were sufficient guidance, checks and safeguards in the Act which prevented excessive delegation. The learned Chief Justice observed that state merits in certain cases to the effect that the power to fix rates of taxes is not an essential legislative function were too broad and that "the nature of the body to which delegation is made is also a factor to be taken into consideration in determining whether there is sufficient guidance in the matter of delegation". According to the learned Chief Justice, the fact that delegation was made to an elected. body responsible to the people including those who paid taxes provided a great check on the elected councillors imposing unreasonable rates of tax. He then said :