Delegated rule-making cannot curtail a statutory right to declaration forms; withholding forms from defaulters was held ultra vires.

The Delhi Sales Tax Act created a substantive mechanism allowing sales to registered dealers for resale to be excluded from taxable turnover on furnishing the prescribed declaration form. An amendment to rule 8(4)(c)(ii) authorised withholding those forms from dealers in tax arrears, but the High Court held that section 71 empowered rules only to carry out the Act's purposes and not to impose a new disqualification or defeat a statutory entitlement. Because the rule materially impaired a right created by the parent Act and could shift the tax burden contrary to the legislative scheme, it was held to be beyond delegated power and ultra vires.

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Issues: Whether the amendment to rule 8(4)(c)(ii) of the Delhi Sales Tax Rules, 1975, which enabled withholding of statutory declaration forms from dealers in tax arrears, was within the rule-making power conferred by section 71 of the Delhi Sales Tax Act, 1975.

Analysis: The Act conferred on a dealer a substantive statutory mechanism for excluding sales to registered dealers for resale from taxable turnover, subject to furnishing the prescribed declaration form. Section 71 authorised rules only for carrying out the purposes of the Act, and the enumerated topics in section 71(2) were illustrative of that limited power. The amendment did not merely regulate procedure for obtaining forms; it introduced a disqualification based on tax default and permitted denial of forms in circumstances not contemplated by the Act. Such withholding could defeat the dealer's statutory right and shift the tax burden contrary to the legislative scheme. A rule framed under delegated power cannot curtail or nullify a right created by the parent Act.

Conclusion: The amended rule was held to be beyond the scope of the delegated rule-making power and therefore ultra vires.

Ratio Decidendi: A delegated rule that withdraws or materially impairs a substantive right created by the parent Act, instead of merely carrying out its purposes, is ultra vires.

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