Relation Between The Union and The States

Relation Between The Union and The States

The distribution of powers is an essential feature of federalism. The object for which a federal State is formed involves a division of authority between the National Government and the separate States.

The tendency of federalism to limit on every side the action of the Government and to split up the strength of the State among co-ordinate and independent authorities is specially noticeable, because if forms the essential distinction between a federal system and a unitary system of Government.

A Federal Constitution establishes the dual polity with the Union at the Centre and the States at a periphery, each endowed with sovereign powers to be exercised in the field assigned to them respectively by the Constitution.

The one is not subordinate to the other in its own field, the authority of one is co-ordinate with that of the other.

The basic principle of federation is that the legislative, executive and financial authority is divided between the Centre and State not by any law passed by the Centre but by Constitution itself.

Legislative Relations:

The Constitution of India makes two-fold distribution of legislative

  1. with respect to territory
  2. with respect to subject matter

Territorial Jurisdiction:

As regards territory, Article 245 (1) Provides that subject to the provisions of this Constitution, Parliament may make laws for the whole or any part of the territory of India.

According to clause (2) of Article 245 a law made by Parliament shall not be deemed to be invalid on the ground that it has extra-territorial operation.

The legislative powers of Parliament and State Legislatures is subject to the provisions of the Constitution.

  • The Scheme of the distribution of Powers.
  • Fundamental Rights.
  • Other provisions of the Constitution.

Legislative Power is plenary:

The power of the Legislature under Article 245 to enact laws is a plenary power subject only to its legislative competence and other constitutional limitations. The power to make a law includes the power to give effect to it prospectively as well as retrospectively.

The Legislature has power to alter the existing law retrospectively. The power to validate a law retrospectively is, subject to other constitutional limitations, an ancillary power to legislate on the particular subject.

Delegated Legislation:

Delegated or subordinate Legislation may be defined as rules of law made under the authority of an Act of Parliament. Although laws are to be made by the Legislature, but the Legislature may by statute delegate its power to other persons or bodies.

Such a statute is commonly known as “the enabling Act” and lays down the broad principles and leaves the detailed rules to be provided by regulations made by a Minister or other persons.

Delegated legislation exists in the form of rules, regulations, orders and bye-laws.

Factors Responsible For The Growth Of Delegated Legislation:

The practice of delegating power to make subordinate legislation has greatly increased in the modern times due to the following reasons:

  1. Pressure on Parliament time – Parliament being a busy body has insufficient time to deal adequately with the increasing mass of legislation necessary to regulate affairs of a complex modern State.
  2. Technicality of Subject-matter – Technicalities of modern legislation require expertise knowledge of problems which is not expected of the legislators in the Legislature which ate composed of politicians.
  3. Opportunity for experimentation – Delegated legislation is more flexible, easily amendable and revocable than ordinary legislation. There is enough scope for experimentation.
  4. Unforeseen contingencies – Subordinate legislation enables a Government to deal with problems which could not be foreseen when the ‘enabling Act’ was passed and to act quickly in an emergency.
  5. Emergency Powers – During the emergency quick and decisive action is necessary and at the same time it is to be kept confidential. The legislature is not fit to serve this end and therefore the executive is delegated the power to make rules to deal with such situations.


The Limits of delegated legislation have been set out in the various decisions of the courts after the new Constitution came into force. It has been held that the Legislature cannot delegate its essential legislative functions which consist in declaring the legislative policy and laying down the standard which is to be enacted into a rule of law with sufficient clearness, and what can be delegated is the task of subordinate legislation which by very nature is ancillary to the statute which delegates the power to make it effective. The courts cannot interfere in the discretion vested in the Legislature in determining the extent of the delegated power in a particular case.

Need To Control Exercise Of Delegated Legislation:

In 1929 the Lord Chief Justice, Lord Heward in his book ‘The New Despotism’ criticised the growth of delegated legislation and pointed out the dangers of its abuse.

As a result, the Committee on Minister’s Powers was set up which in its report accepted the necessity for delegated legislation but considered that the power delegated might be misused and recommended the following modes of control over the delegated legislation namely:

  1. Nomenclature of various forms of delegated legislation should be supplied and better provision be made for publication.
  2. The Precise limits of law-making power which Parliament intended to confer on a minister should be clearly defined.
  3. The use of “Henry VIII clause” authorising a Minister to amend the enabling Act itself should be an exception and be confined to bringing an Act into operation.
  4. Clauses excluding jurisdiction of the Courts should be abandoned in all but the most exceptional cases.
  5. Consultation with interested bodies should be extended.
  6. Parliament scrutiny and control should be improved.

There are two types of control over delegated legislation:

  • Judicial Control
  • Parliamentary Control

Judicial Control:

The Courts have power to consider whether the delegated or subordinate legislation is consistent with the provisions of the ‘enabling Act’.

Their validity can be challenged on the ground of ultra vires beyond the competence of the Legislature.

Parliamentary Control:

It is the primary duty of the Legislature to supervise and control the exercise of delegated power by the executive authorities.

Parliamentary control over the delegated legislation is exercised at three stages.

The First Stage is the stage when power is delegated to the subordinate authorities by Parliament.

The Second Stage is when the rules made under the statute are laid before the Houses of Parliament through the committees on subordinate legislation.

The Residuary Powers:

Article 248 vests the residuary powers in the Parliament. It provides that subject to Article 246-A, Parliament has exclusive power to make any law with respect to any matter not enumerated in the Concurrent list or the State List.

Entry 97 in the Union List also lay down that Parliament has exclusive power to make laws with respect to any matter not mentioned in the State List or the Concurrent List including any tax not mentioned in either of these Lists.

Parliament’s power to Legislate on State Subjects:

Power of Parliament to legislate in the National Interests:

According to Article 249(1), if the Rajya Sabha passes a resolution supported by 2/3 of the members present and voting that it is necessary or expedient in the national interest that Parliament should make laws with respect to goods and service tax provided under Article 246A or any matter enumerated within State Law, then it shall be lawful for the Parliament to make laws for the whole or any part of the territory of India with respect to that matter so long as the resolution remains in force.

During a Proclamation of Emergency:

According to Article 250 while the Proclamation of Emergency is in operation the Parliament shall have power to make laws for the whole or any part of the territory of India with respect to goods and service tax provided under Article 246A or any of the matters in the State List. Such a law, however, shall cease to have effect on the expiration of six months after the proclamation of emergency has ceased to operate.

Parliament’s Power to Legislate with the Consent of the States:

According to Article 252 of the Legislature of two or more States pass resolution to the effect that it is desirable to have a law passed by Parliament on any matters in the State List, it shall be lawful for Parliament to make laws regulating that matter.

Any other State may adopt such a law by passing a resolution to that effect, Such law can only be amended or repealed by the Act of Parliament.

Parliament’s Power to Legislate for Giving Effect to Treaties and International Agreements:

Article 253 empowers the Parliament to make any law for the whole or any part of the territory of India for implementing treaties

and international agreements and conventions.

Treaties are not required to be ratified by Parliament.

They are, however, not Self-Operative.

Administrative Relations – Arts. 256-263:

“A Federal Scheme involve the setting up of dual Government and division of powers. But the success and strength of the federal policy depends upon the maximum of co-operation and co-ordinate between the Governments”

Control of Union over States: 

Articles 256 to 263 provide for Union control over States even in normal times through following ways:

  • A) Direction by the Union to The State Government:

The Idea of Union giving direction to the States is foreign and repugnant to a rule of federal system. But this idea was taken by the framers of our Constitution from the Government of India Act, 1935, in view of the peculiar conditions of this country and particular circumstances out of which the federation emerged.

  • B) Delegation of Union’s Function to the States:

Under Article 258 the Parliament may, with the consent of the State Government, entrust either conditionally or unconditionally to that Government or to its offices functions relating to any matter falling within the executive powers of the Union.

  • C) All-India Services:

         “All-India Service” common to the Union and the States. According to Article 312 if the Rajya Sabha passes a resolution supported by not less than two-thirds of the members present and voting that it is necessary or expedient in the nation’s interest to do so. Parliament may by law provide for the creation of one or more All-India Services common to the conditions of persons appointed to any service.

  • D) Grants in-aid:

Under the Constitution the financial resources of the State are very limited though they have to do many works of social uplift under directive principles.

In order to cope with their ever-expanding needs, the Central Government makes grants-in-aid to the States.

  • E) Full Faith and Credit Clause:

         Article 261 declares that full faith and credit shall be given throughout the territory of India to public acts, records and judicial proceedings of the Union and every State.

According to clause (3) final judgement or orders delivered or passed by Civil Courts in any part of the territory of India can be executed anywhere in the country according to law.

Co-Ordination between States – Co-Operative Federalism:

Though a Federal Constitution involves the sovereignty of the Units within their respective territorial limits it is not possible for them to remain in complete isolation from each other and the very exercise of internal sovereignty by the units required its recognition by and co-ordination of other units of the federation.

Federal Constitutions therefore generally provide certain rules for co-operation which the units are expected to take into consideration while dealing with each other.

Inter-State Council: 

Article 263 provides for the establishment of an Inter-State Council to effect co-ordination between States. The Inter-Council is appointed by the President if it appears to him that the public interest would be served by its establishment. The Inter-State Council is generally charged with the duty of

  • Inquiring into and advising upon disputes which may arise between States
  • Investigating and discussing subjects in which some or all of the States of the Union and one or more of States have common interest
  • Making recommendation on any subject and for the better co-ordination of the policy and action with respect to that subject.

Duties of the Council:

The Council shall be a recommendatory body and it shall perform the following duties:

  • Investigate and discuss subjects of common interest
  • Make recommendations for the better co-ordination of policy and actions on such subjects
  • Deliberate on such matters of general interest to the States referred by the Chairman to the Council.

Secretariat of the Council: 

The Council shall have a secretariat consisting of such officers and staff as the Chairman thinks fit to appoint.


Financial Relations: (Arts. 264-291)

No System of federation can be successful unless both Union and the States have at their disposal adequate financial resources to enable them to discharge their respective responsibilities under the Constitution.

In India, the scheme of distribution of Sources of revenue between the Centre and the States is based on the scheme laid down in the Government of India Act, 1935.

The framers of the Indian Constitution desired that the scheme of financial relation be flexible and adaptable to varying needs and reviewable periodically in the light of experience, of Central resources, of State’s needs, and available dare.

For this, they recommended for the appointment of Finance Commission to review the whole position from time to time.

Taxation Only By Authority of Law:

Article 265 provides that no tax can be levied or collected except by authority of Law. No tax can be imposed by an executive order.

Distribution of Revenues  between The Union and The States (Art. 268):

Article 268 provides the scheme of the distribution of revenue between the Union and the States. The States possess exclusive jurisdiction over taxes enumerated in the State List. The Union is entitled to the proceeds of the taxes in the Union List.

  1. Duties levied by the Union but collected and appropriated by the States.
  2. Service Tax levied by Union and collected and appropriated by Union and States.
  3. Taxes levied and collected by the Union and assigned to the States.
  4. Taxes levied and collected by the Union but distributed between the Union and States.
  5. Taxes for the purpose of the Union.
  6. Grants-in-aid.
  7. Taxes for the purposes of States.

Finance Commission:

Article 280 provides for the establishment of a Finance Commission. The President shall within two years from the commencement of the Constitution and thereafter at the expiration of every fifth year or at such earlier time as he considers necessary constitute a Finance Commission.

Duties of the Finance Commission: 

  • It shall be the duty of the Commission to make recommendations to the President as to
  • The Distribution between the Union and the States of the net proceeds of taxes which are to be, or may be, divided between them under this Chapter and the allocation between the States of the respective shares of such proceeds.
  • The Principle which should govern the grants-in-aid of the revenues of the State out of the Consolidated Fund of India.
  • The measures needed to augment the Consolidated Fund of State to supplement the resources of the Panchayats in the State on the basis of the recommendations made by the Finance Commission of the State.
  • The measures needed to augment the Consolidated Fund of a State to supplement the resources of the Municipalities in a State on the basis of the recommendation made by the Finance Commission of the State.
  • Any other matter referred to the Commission by the President in the interest of sound finance.

Borrowing Powers:

Article 292 gives the Union unlimited power to borrow money on the security of the Consolidated Fund of Indian either within or outside.

The Union Government can borrow within such limits as may be fixed by Parliament from time to time.

It can also guarantee any debts within such limits.

Article 293 permits a State, subject to any limits fixed by the State Legislature, to borrow money within the territory of Indian on the security of the Consolidated Fund of State.

The borrowing power of State is thus subject to a number of restrictions.


D.D. Basu, Commentary on India Constitution, Justice. S.S. Subramani 

D.C. Jain, Constitution of India by V.N. Shkula (1969)

Dr. J. N. Pandey, Constitutional Law of India (1969)

Sujata.V. Manohar, T.K. Tope’s Constitutional Law of India (2010)



Author: R. Shanmuga Sundaram,
Student - Chettinad School of Law

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