Judicial Dictionary

Ultra vires rules

The Rules are ultra vires may thus be stated:

Under the common law of England, a person has the right to do through an agent whatever he can do himself, and that right has also been conferred on him in this country by S. 2. Powers-of-Attorney Act 7 of 1882, which runs as follows:

“The done of a power-of-attorney may, if he thinks fit, execute or do any assurance, instrument or thing in and with his own name and signature, and his own seal, where sealing is required, by the authority of the donor of the power and every assurance, instrument and thing so executed and done, shall be as effectual in law as if it had been executed or donee by the done of the power in the name, and with the signature and seal, of the donor thereof.

“This section applies to powers-of-attorney created by instruments executed either before or after this Act comes into force”.

Section 26-A of the Act confers on a partner the right to apply for registration of the firm, and that right could be exercised both under the common law and under S. 2, Powers -of-Attorney Act through an authorised agent. The sovereign legislature might, if it so chooses, abrogate the rule of common law, and repeal S. 2, Powers-of-Attorney Act, and enact that the application to be presented under S. 26-A should be signed by the partner himself and not by any other person; but it has not done so either expressly or by necessary implication, and, therefore, the application which was signed by Hariprasada Rao is as good as if it had been signed by Subba Rao. The Rules no doubt require that the signature should be that of the partner and not that of his agent. But in prohibiting what would be lawful under the section, the rules go beyond the ambit of the authority conferred by S. 26-A on the rule-making authority, which is limited to framing rules for giving effect to the principles laid down in the statute. They are therefore ultra vires.

In the alternative, assuming that the mandate given to the rule making authority under S. 26-A is of sufficient amplitude to authorise the making of the Rules in question, even then, they must be held to be ultra vires, as they have the effect of abrogating the common law and repealing S. 2, Powers-of-Attorney Act, which confer on a person the right to act through an agent, and that being a legislative function cannot be delegated to a rule-making authority, and S. 26-A, if it is to be construed as conferring such power on an outside authority, must be struck down as constituting an unconstitutional delegation by the legislature of its legislative function.

According to the law of England – and that is also the law under the Indian Contract Act, 1872 –

“every person who is sui juris has a right to appoint an agent for any purpose whatever, and that he can do so when he is exercising a statutory right no less than when he is exercising any other right. “ Per Stirling J. in Jackson and Co. V. Napper:In re schmidts ‘ Trade-Mark, (1886) 35 Ch D 162,.”

This rule is subject to certain well-known exceptions as when the act to be performed is personal in character, or is annexed to a public office, or to an office involving fiduciary obligations. But apart from such exceptions, the law is well-settled that whatever a person can do himself, he can do through an agent. It has accordingly been held that “at common law, when a person authorizes another to sign for him, the signature of the person so signing is the signature of the person authorizing it. Per Blackburn J. in The Queen vs. Justices of Kent, (1873) 8 Q B 305,.

“The appellant is therefore right in his contention that unless the statute itself enacts otherwise, an application which a partner has to sign would be in order and valid, if it is signed by his authorised agent. The question then is whether there is anything in the Act, which requires that an application under S. 26-A should be signed by the party personally”.

S. Section 26-A is as follows:

“(1) Application may be made to the Income-tax Officer on behalf of any firm, constituted under an instrument of partnership specifying the individual shares of the partners, for registration for the purposes of this Act and of any other enaciment for the time being in force relating to income-tax or super-tax.

(2) The application shall be made by such person or person, and at such times and shall contain such particulars and shall be in such from, and be verified in such manner, as may be prescribed; and it shall be dealt with by the Income-tax Officer in such manner as may be prescribed.”

The Section does not, it should be noted, provide that the application for registration should be signed by the partner personally, and it is this that forms the foundation of the contention of the appellant that the right which a person has under the general law and under S. 2, Powers-of -Attorney Act; to act through an agent has not been taken away or abridged by the section. He relies in support of his contention on the following rules of construction:

1- Statutes which encroach on the rights of a subject would be interpreted if possible so as to respect such rights. (Vide Maxwell on Interpretation of Statutes, Edn. 10, p. 285, Craies on Statute Law, Edn. 5, pp. 111 to 114). The Law is thus stated by Bowen L. J. in In re Cuno:Mansfield V. Mansfield, (1889) 43 Ch D 12,:

“In the construction of statutes, you must not construe the words so as to take away rights which already existed before the statute was passed, unless you have plain words indicate that such was the intention of the legislature”.

(2) In the absence of clear and unambiguous language, an intention to alter the existing law should not be imputed to the legislature. (Vide Craies on Statute Law, Edn. 5,).

(3) The law does not favour repeal of a statute by implication, and therefore a later statute should not be construed as repealing an earlier one without express words or by necessary implication. (Vide Maxwell on Interpretation of Statutes, Edn. 10, p. 170; Craies on Statute Law, Edn. 5, p. 337).

“If it possible”, observed Farwell J., it is my duty so to read the section as not to effect an implied repeal of the earlier Act”:Re Chance 1936-1 Ch 266.

“Unless two Acts are so plainly repugnant to each other that effect cannot be given to both at the same time, a repeal will not implied”. Per A. L. Smith J. in Kutner vs. Phillips, 1891-2, Q B 267,.


Quoted from: AIR 1956 SC 604 : (1956) SCR 577

Categories: Judicial Dictionary

Tagged as: