In applying this test, the court has to take into account the statements in the preamble to the Act and if the statements afford a satisfactory basis for holding that the legislative policy and principle has been enunciated with sufficient accuracy and clarity the preamble itself has been held to satisfy the requirements of the relevant tests. In every case, it is necessary to consider the relevant provisions of the Act in relation to the delegation made, and the question as to whether the delegation is ultra vires or not will have to be decided by the application of the relevant tests.
In Edward Mills Co. Ltd. v.
State of Ajmer, A.I.R. 1955 S.C. 25: (1955) 1 S.C.
R. 735, the validity of the notification issued under the provisions of the Minimum Wages Act, 1948 was impeached. It was contended that the provision of section 27 of the Act is illegal and ultra vires inasmuch as it amounts to an illegal and unconstitutional delegation of legislative powers by the Legislative in favour of the ‘appropriate Government’ as defined in the Act. This contention raised the question about the validity of the delegation provided for by section 27.
The scheme of the Act was that a Schedule had been attached to it which gives a list of employments to which the provisions of the Act apply. Section 27 gives power to the appropriate Government to add to either part of the Schedule any employment in respect of which it is of opinion that the minimum wages shall be fixed and this the appropriate Government is authorised to do by giving notification a broad manner and thereupon the Schedule shall, in its application to the State, be deemed to be amended accordingly. The argument was that the Act has nowhere formulated a legislative policy according to which an employment should be chosen for being included in the Schedule; no principles have been prescribed and no standards laid down in this behalf, so the delegation is unfettered and uncanalised. This argument was rejected by the Supreme Court on the board consideration that the legislative policy is apparent on the face of the Act itself. It was observed by Mukherjee, J.: “What the Act aims at is the statutory fixation of minimum wages with a view to obviate the chance of exploitation of labour.
The legislature undoubtedly intended to apply this Act not to all industries but to those industries only where, by reason of unorganised labour want of proper arrangements for effective regulation of wages or for other causes, the wages of labourers in a particular industry were very low.” The learned Judge then pointed out that conditions of labour vary under different circumstances and from State to State, and the expediency of including a particular trade or industry within the Schedule depends upon a variety of facts which can best be ascertained by the person who is placed in charge of administration of a particular State. It is with a view to carry out the particular purpose of the Act that the power is delegated to the appropriate Government by section 24. This is how the challenge to the vires of section 27 was repelled by the Supreme Court. In Vasantlal’s case (A.I.R.
1961 S.C.4). Subba RAo, J.
observed as follows: “The Constitution confers a power and imposes a duty on the Legislature to make laws. The essential legislative function is the determination of the legislative policy and its formulation as a rule of conduct. Obviously it cannot abdicate its functions in favour of another.
But, in view of the multifarious activities of a welfare State, it (the legislature) cannot presumably work out all the details to sit the varying aspects of a complex situation. It must necessarily delegate the working out of details to the executive or any other agency. But there is a danger inherent in such a process of delegation. An overburdened legislature or one controlled by a powerful executive may unduly overstep the limits of delegation. It may- (a) Not lay down any policy at all; (b) Declare its policy in vague and general terms; (c) Not set down any standard for the guidance of the executive; (d) Confer an arbitrary power to the executive on change or modify the policy laid down by it without reserving for itself any control over subordinate legislation.
The self-effacement of legislative power in favour of another agency either in whole or in part is beyond the permissible limits of delegation. It is for a Court to hold on a fair, generous and liberal construction of on impugned statute whether the Legislature exceeded such limits.”