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Federation - Federal Structure

Updated: Jul 15, 2021

Federal Structure :States are classified into federal and unitary. In a Unitary State, the Sovereign power to legislate is vested in one Central Legislature, i.e., the Parliament.

E.g.: The United Kingdom, France etc. In a Federal State, the Federal State and the Federating Units share the Sovereign power of the State. The essential feature of federalism is that there is the distribution of executive legislative and judicial authority among bodies which coordinate with and are independent of each other (Dicey).

Eg. USA, Switzerland, Australia, Canada etc.


(i) Supremacy of the Constitution : A Federation is brought into existence with a 'Compact' among the federating units.This 'Compact' is the sheet-anchor on which the Consti- tution is framed. Hence, the Constitution is supreme and all acts—legislative, executive or judicial—are to be in conformity with the Constitution.

(ii) Division of Powers: The distribution of the Sovereign powers between the Federal State and the federating units is the second feature. Each State has provided for this, in its own way in its Constitution. The residuary powers may be vested in the States as in the U.S., Australia and Swiss Constitutions—or with the centre as in Canada and India.

(iii) Participation in Amendment: In amending the Con- stitution, there is the participation of both the Union and the States. This gives certain amount of rigidity to the Consti- tution. As Prof. Wheare points out, it is not the Constitution but ultimately the people who are rigid or flexible. The essence of participation of the Centre and States is that the amending power is beyond the powers of the Centre alone or States alone.

(iv) Judicial Review : The Supreme Court is the final interpreter of the Constitution and the law. Hence, any question of competency of the Centre or the States is decided by the Courts.

Quasi Federal Structure:

Cases :

(i) In Keshavananda Bharati's Case the Supreme Court held, that inter alia, Federalism is the 'basic structure' of the Constitution.

(ii) In State of West Bengal V Union of India (1977) after the 1977 General Elections, the Janata government wrote to 9 chief ministers to advise the Governors to dissolve the Assemblies. This was challenged as a 'threat'. The suits were dismissed. Held, Indian Constitution is Amphibian (both Unitary and Federal) in nature.

Distribution of Legislative Powers :

(i) One of the essential features of a federal State, is the distribution of the sovereign power to legislate between the Union and the States. The Indian Constitution is modelled on the federal structure, but there are more unitary powers than federal. This has led to hold the Indian federalism as quasi federal or Amphibian (both Unitary and Federal). This is evident from Keshavananda Bharati's Case, State of West Bengal V.Union of India and State of Rajastan V.Union.

(ii) Distribution : Arts. 245 to 253 deal with distribution of legislative powers and the special circumstances when the Union may make law in the State list.

(a) Union List: The Parliament may make law for the whole or any part of the territory of India, and has exclusive power to legislate on any matter enumerated in List 1 of 7th Schedule called the Union List :This has 97 items.

Eg.: Defence, Foreign affairs, Extradition, Railways, Air- ways, Census, currency, foreign exchange, War and Peace, Diplomatic and Consular representation, citizenship, aliens, Reserve Bank of India, Banking, Insurance etc.

(b) State List: Legislatures of State may make law in the State List of the 7th Schedule and the law made by the State is applicable throughout the territory of that State. This has 66 items.

Eg. : Agriculture, Fisheries, Markets and Fairs, Theatres, Sales Tax, Land Revenue, Public Health Sanitation, Hospitals and Dispensaries Taxes on Agricultural Income, Entry Tax, Profession Tax etc.

(c) Concurrent List: Parliament and State Legislatures may make law in the Concurrent List of the 7th Schedule. This has 47 items.

Eg. : Contracts, Trusts, Trade Unions, Charities, Price Control, Factories, etc. But Education was added from State List: 42nd Amendment.

(d) Residuary:After distributing the Sovereign power to legislate between the Union and the State, according to Union List, State List and Concurrent List, the Constitution vests the residuary in the Union [Art. 245(4)]. This is called the Residuary.

In the U.S., Australian and Swiss Constitutions, the resi- duary is with the local States. As Prof. Wheare points out, in his "Federal State" the vesting of the residuary tilts the balance in favour of federalism. But, in Canada and India, the residuary is with the Union and hence, they have more slant towards Unitary Statehood.

The leading case on residuary is Union of India V. Dhillon (1975). It was held that to test the Union Law, we have to find out whether that Law is encroaching any of the items of State List.If it does not, then it is within the power of the Union.

The reason is, the Union List, the Concurrent List and the residuary are with the Union. Hence, Wealth tax imposed on Agricultural Land by the Parliament was upheld by the Supreme Court as this did not encroach State List.

(iii) Powers of the Parliament to Legislate in State List: There are Four circumstances when the Parliament may make law in the State List: and, in such a case, the federal structure gives way to the Unitary State. Of course, all the 4 circumstances are specific and are limited.

(1) Art. 249 : National Interest : If the Rajya Sabha declares with a 2/3 majority that in National Interest Parliament should make law in a particular item in the StateList, then such a law may be made by the Parliament. The life of such a resolution is one year and may be renewed if not so renewed, such a law operates for 6 months after the resolution ceases. Eg.: Essential Commodities Act.

(2) Art. 250 Emergency : When a proclamation of Emer gency is in operation, Parliament shall have the power to make law in the State List. Such a Law will be in operation during emergency and 6 months after the emergency is lifted.Eg.: Defence of India Act and Rules.

(3) Art. 252. States delegation: If Two or more States, in their legislatures pass resolution empowering the Parliament to make law in a specified item in the State list, then Par liament may make law in that item. That law is applicable to those States only. State have no power to amend such law. Eg. : Prize Competitions Act.

(4) Art. 253. Treaties : Parliament is empowered to make law to implement any treaty, agreement or convention with any other Country or with International Organisations.

Doctrine of 'Occupied field':

In the Concurrent list, both the Parliament and the State may make law. If there is any repugnancy or conflict between the State law and the Union law, the Union law prevails.

Parliament may make law in an item in the Concurrent list. State may also make law in the same item. In such a case, if a conflict arises the Courts have applied the doctrine of

'Occupied field'.

The leading case is State of Orissa V. Tolloch & Co. The Orissa Legislature made a law levying taxes on all minerals for the better development of mining areas.Later, the Parlia- ment in 1957, made the Mines and Minerals Act. This was a comprehensive law empowering the Central Government to take measures for developing the entire Indian mineral re- sources. Held, the Parliament had shown its intention to cover the entire item of legislation.

There was no place for Orissa law. Hence, the Orissa law is superseded and Parliament's law prevailed. In Forbes V. Manitoba, (Canada) a Province and the dominion (Centre) had made income tax laws. Question was whether occupied field applied. Held, the two taxes could co-exist, without any conflict. Hence,occupied field would not apply.

Doctrine of 'Pith & Substance':

Parliament has the power to make law in the 'Union List' & the States in the 'State List'. Either Parliament or the States should not trench upon (invade) each other's field of legisla- tion. If Parliament makes law in State list, it would be ultra vires.But, how to test the trenching ? This is done by applying the doctrine of pith and substance (or pith and marrow). The court considers the true nature and character of legislation.

Case : (1) Prafulla Kumar V. Bank of Commerce.Bengal Money lenders Act was passed to protect agricul- turists . It was challenged on the ground that it affected promis- sory note. 'Money Lending' is in State List, 'Promissory Note' is Central Subject.Hence, the question

was whether the State law was invading Central Subject. Applying pith and substance, the court held that the true character was Money- lending,and promissory note was incidentally affected. Hence, the law was valid.

Case : (2) State of Rajastan V. Chawla (1959).The State made a law regulating the use of amplifiers. This created a conflict between State List (public health) and Union list (Communications). Hence, there is an overlap. The Court applied 'pith and substance'. The pith was 'Noise, injurious to public health.' Hence, it came under public health. The encroachment on Union list is incidental.Hence, the Act was held valid.

Case : (3) Gujarat University V. Srikrishna (1963). State List: 'Education'.Union List : 'Standards in institutions for higher education' .The Gujarat State prescribed Gujarati and Hindi as medium of instruction under 'Education'. This was challenged as violative of Union List.The true essence was higher education and hence, the State law was held Ultra Vires.


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