Extension of State laws to a Union Territory remained valid where the later amendment did not conflict with existing law.

Section 87 of the Punjab Reorganisation Act, 1966 was treated as a valid power enabling the Central Government to extend existing State enactments to Chandigarh with limited restrictions or modifications, because it laid down the legislative policy and constituted a recognised method of transplanting laws to a Union Territory without a legislature. On that basis, the later notification extending the 1985 Punjab rent amendment to Chandigarh was regarded as valid, since the earlier parliamentary extension of the principal rent law did not bar subsequent amendments unless the later measure repealed, conflicted with, or was repugnant to the law already operating in Chandigarh. The stated ratio is that such extension remains permissible within the scope of the enabling provision.

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Issues: (i) Whether section 87 of the Punjab Reorganisation Act, 1966 conferred unconstitutional excessive delegated legislative power on the Central Government. (ii) Whether the notification dated 15.12.1986 extending the 1985 Punjab rent amendment to Chandigarh was valid despite the existing parliamentary extension of the principal rent law to Chandigarh.

Issue (i): Whether section 87 of the Punjab Reorganisation Act, 1966 conferred unconstitutional excessive delegated legislative power on the Central Government.

Analysis: Section 87 empowered the Central Government to extend to Chandigarh any enactment in force in a State at the date of the notification with restrictions or modifications. The validity of such delegating provisions was examined against the settled doctrine that the legislature must lay down the legislative policy and cannot abdicate its essential function. The earlier authorities on analogous provisions, especially the line of decisions on extension of laws to special territories, were treated as showing that extension of already enacted laws, with limited adaptations, is a recognised legislative technique and not per se abdication. The provision was read in its historical and constitutional context, namely, the need to provide laws quickly for a newly constituted Union Territory with no separate legislature, and the Court treated the power as a permitted form of transplantation of laws rather than creation of a parallel legislature.

Conclusion: Section 87 was held to be constitutionally valid and not an instance of excessive delegation.

Issue (ii): Whether the notification dated 15.12.1986 extending the 1985 Punjab rent amendment to Chandigarh was valid despite the existing parliamentary extension of the principal rent law to Chandigarh.

Analysis: The Court held that the earlier parliamentary extension of the principal rent law to Chandigarh under section 3 of the East Punjab Urban Rent Restriction (Extension to Chandigarh) Act, 1974 did not create an impermeable legal vacuum preventing later extension of further State amendments. The proper test was whether the later extension conflicted with, repealed, or was repugnant to the existing law in Chandigarh. Since the 1985 amendment only supplemented the existing regime and did not expressly or impliedly repeal or contradict the parliamentary law already operating in Chandigarh, the notification remained within the scope of section 87. The Court also rejected the contention that section 87 was confined to a one-time or vacuum-filling operation only.

Conclusion: The notification extending the 1985 Act to Chandigarh was held valid.

Final Conclusion: The challenge to the Central Government notification failed, and the statutory extension of the Punjab rent amendments to Chandigarh was upheld.

Ratio Decidendi: A provision authorising extension to a Union Territory of existing State enactments with limited modifications is valid where it lays down the broad legislative policy, and such extension remains permissible so long as the later enactment does not repeal, conflict with, or become repugnant to the law already operating in the territory.

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