2005 (9) TMI 620 - SC - Indian Laws

Supreme Court Invalidates Section 22-A of Registration Act, Emphasizes Limits on Delegated Powers

STATE OF RAJASTHAN & ORS. Versus BASANT NAHATA

The Supreme Court upheld the High Court's decision, ruling Section 22-A of the Registration Act unconstitutional and invalidating related notifications. ... Whether Section 22-A of the Registration Act (The Act) as amended by the State of Rajasthan as also the notifications issued by it in terms thereof constitutionally valid? Whether Section 22-A of the Act confers arbitrary powers on the State Government to determine as regard declaring a particular document being opposed to public policy? Issues Involved:1. Constitutionality of Section 22-A of the Registration Act as amended by the State of Rajasthan.2. Validity of the notifications issued under Section 22-A of the Registration Act.3. Delegation of legislative power and its limits.4. Interpretation of the term 'public policy' and its application.5. Judicial review of policy decisions.Detailed Analysis:1. Constitutionality of Section 22-A of the Registration Act:The appeal questioned the constitutionality of Section 22-A of the Registration Act as amended by the State of Rajasthan. The High Court declared Section 22-A as unconstitutional, stating that it conferred arbitrary powers on the State Government to determine what constitutes 'opposed to public policy,' a determination that should be made by the courts, not the Sub-Registrar. The legislation was deemed to invade the right of a citizen to deal with property, rendering it arbitrary and unreasonable.2. Validity of the Notifications:The notifications issued under Section 22-A were also challenged. These notifications prohibited the registration of certain documents, such as power of attorney authorizing the transfer of immovable property for a term exceeding six months (later amended to three years) or where the term is not mentioned. The High Court quashed these notifications, finding them unconstitutional and directing the Sub-Registrar to register the power of attorney presented by the respondent.3. Delegation of Legislative Power:The court examined the limits of delegating legislative power to the executive. It was emphasized that while the legislature can delegate procedural powers, it cannot delegate essential legislative functions or confer unguided, uncontrolled power on the executive. The principle that essential legislative functions must be retained by the legislature itself was reiterated, and the delegation of power must be accompanied by clear guidelines and standards.4. Interpretation of 'Public Policy':The term 'public policy' was scrutinized, with the court noting that it is inherently vague and cannot be precisely defined. The judiciary, not the executive, should interpret what constitutes public policy. The court cited various legal precedents to illustrate that public policy is a concept governed by common law and precedents, and it should not be left to the executive's discretion. The court held that the phrase 'opposed to public policy' does not provide sufficient guidelines to render the legislation constitutional.5. Judicial Review of Policy Decisions:The court reaffirmed that policy decisions, even those involving legislative policy, are subject to judicial review. It was held that a legislative policy must conform to constitutional mandates, and the judiciary has the power to review and invalidate policy decisions that violate constitutional principles.Conclusion:The Supreme Court upheld the High Court's judgment, declaring Section 22-A of the Registration Act as unconstitutional and quashing the related notifications. The court emphasized that essential legislative functions cannot be delegated to the executive without clear guidelines and that the concept of public policy should be interpreted by the judiciary. The appeal was dismissed, and no costs were awarded. The court also clarified that any orders passed by Sub-Registrars or Registrars refusing to register documents under similar notifications by other states would not be reopened.