Rules made by Centre, State cannot exceed powers granted by parent statute: SC

The SC ruling on a Kerala electricity board appeal holds that delegated legislation, such as rules and regulations, must not supplant, exceed or be in non-compliance with the law they derive power from

The apex court reversed the High Court decision while holding that the Regulation was inconsistent with Section 126(6) of the Electricity Act, 2003. File | Photo Credit: PTI

Delegated legislation, including rules and regulations formed by State and Central authorities, should not supplant but supplement the parliamentary statute from which it draws power from, the Supreme Court has held in a judgment.

"If a rule goes beyond the rule-making power conferred by the statute, the same has to be declared invalid. If a rule supplants any provision for which power has not been conferred, it becomes invalid," a Bench of Justices Dinesh Maheshwari and JB Pardiwala observed.

A delegated power to legislate by making rules or regulations cannot be exercised so as to bring into existence substantive rights, obligations or disabilities not contemplated by the provisions of the parent statute, Justice Pardiwala, who authored the judgment, wrote.

As a body making rules or regulations has no inherent power of its own to make rules, but derives such power only from the statute, it has to necessarily function within the purview of the statute. "Delegated legislation should not travel beyond the purview of the parent Act. If it does, it is ultra vires and cannot be given any effect," Justice Pardiwala explained.

Ultra vires (acting beyond one’s legal powers) may arise in cases of simple excess of power, inconsistency with or sheer non-compliance with the procedural requirements of the parent law.

The court has laid down the law in an appeal filed by the Kerala State Electricity Board against a State High Court decision which upheld Regulation 153(15) of the Kerala Electricity Supply Code, 2014. Regulation 153(15) of the Code provided that ‘unauthorised additional load’ in the same premises and under the same tariff shall not be reckoned as ‘unauthorised use of electricity’ except in cases of consumers billed on the basis of the connected load.

The apex court reversed the High Court decision while holding that the Regulation was inconsistent with Section 126(6) of the Electricity Act, 2003. Section 126 of the 2003 Act was enacted with a specific purpose to restrict such unauthorised consumption of electricity.

“The overdrawal of electricity is prejudicial to the public at large, as it is likely to throw out of gear the entire supply system, undermining its efficiency, efficacy and even-increasing voltage fluctuations… Regulation 153(15) deserves to be declared invalid being inconsistent with the provisions of Section 126 of the Act 2003,” the judgment said.