LexUNION OF INDIA versus ANNAM RAMALINGAM ETC. ETC.
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• .... , • UNION OF INDIA v. ANNAM RAMALINGAM ETC. ETC. !list February, 1985 (V.D. TULZAPURK:AR, RANGANATH MISRA AND V. KI!ALID, JJ.) Gold Control Act, 1968, section 28, constitutional validity-Whether ·8ection 28 suffers from the vice of excessive delegation of legislative power- Doctrine of Parity of Reasoning. Section 28 of the Gold Control Act, 1968 bars money lending busi- ness to be carried on in licensed premises, ei1her by the liQeosed dealer or by any other person unless authorised by the Administrator to do so. Drawing analogy from the reasoning adopted by the Supreme Court in its decision reported in Harakchand Ratanchand Banthla v. Assistant Collector of Central Excise, Poona, II Division, [1970] I SCR 479=AIR J971 SC 1170, the High Court of Andhra Pradesh struck down the said provision on the ground that it suffers from the vice of excessive delegation of legislative power in as much as no criteria or guidelines have been provided by reference to which the power conferred on the Administrator to refuse permission or grant permission should be exercised and that the section confers an arbitrary, uocaaalised and unfettered power upon the Administrator with the result that the licensed dealer is at his mercy while seeking permission to carry on moneyalending or banking business on the security of any article, ornament or both in the same premises in which he carried on business as such dealer. Hence the appeal 'by special leave. Allowing the appeal, the Court HELD : I. I Section 28 of the Gold Control Act, 1968 cannot be struck down on the ground of excessive delegation of legislative power and its validity must be upheld. [9S7C] 1.2 It is true that no express rule prescribing the conditions or circumstances under which the permission can be granted or refused has been framed nor any particular guide~line has been expressly indicated in section 28 by reference to which the power conferred upon him thereunder could be exercised by tho Administrator, but that is not decisive of the matter. [954H; 955 A] A B c D E F H B c D E F n 952 SUPREME COURT REPORTS (1985) 2 S.C.R l.3 Section 28 of the Gold Control Act, 1968 is part and parcel of the entire scheme of the Gold Control Act The objective, the policy and the scheme of the Act together with the necesssity to ensure prevention of circumvention of tl:le other provisions of the Act afford more than suffi- cient guidance to the Administrator in the n1atter of t:xcrcising the power or discretion conferred on him under sec ti on 28. The several restrictions that have been put on the activities of the t.raders doing business in gold will have to be viewed, in the light of th~ purpose for which the Gold Control Act was passed viz., that even lhough import of gold into India had been banned considerable quantities of contraband gold were finding their way into the country through illegal channels affecting the national economy and hampering the country's economic stability and progress, that the Customs Department wa!I not in a position to effectively combat the smuggling over the long borders and coast-line, that therefore anti-smugg- ling mea~ures bad to be supplemented by a detailed system of control over internal transactions. Io fact section S ~1) of the Act requires that the Administrator should have regard to the policy and purposes of the Act in making bis orders. Moreover against his order under that section a revi- sion lies to Central Govarnment which implies that he will have to make judicious use of bis power or discretion arid iiny improper exercise is liable to be corrected by a higher authority. Therefore, it cannot be said that unfettered or uncanalised or arbitrary power ha~ been conferred upon the Administrator under section 28. [955B; E-G] 1.4 Further section 28 does not impose any blanket or absolute prohibition upon a dealer from carrying on money.lending, banking or any other business in the same premises in which he carries on business as a dealer bot he is prevented only from c.trrylng on business as money~lender or banker on the security of any artic:e, ornament or both unless authorised by the Administrator. Even the restri-.:tion i11 the case of a third person in carrying on buo;iness as a money-lendor, banker or any other business in the same premises is not absolute in as much 'lS the Administrator can authorise the third person to carry on the
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