1. This is an application by Meer Singh, who has been sentenced to rigorous imprisonment for a period of three months and to a fine of Rupees 100 under Rule 38(1)(a) read with Rule 34(6)(j), Defence of India Act. The facts found are that one Earn Narain went to the applicant's shop on 17th June 1940 and bought some flour and gram for five annas and three pies ; he presented a currency note for Rs. 10 and asked for change; the applicant refused to accept the note. The learned Judge of the lower appellate Court has believed the evidence of the witnesses for the prosecution. They say that the applicant made some excuses, but eventually said that he would not accept a currency note. One of them has said that the accused stated that currency notes were no longer legal tender and that Government themselves refused to accept them in their treasuries. The trial Court was of the same opinion as the Judge. Both Courts have found that by refusing to take the currency note in the circumstances related the applicant was undermining public confidence in the paper currency of the Government of India. The learned Judge has referred to the fact that at that time there was an indication of financial panic. Learned Counsel has suggested to us, in the first place, that this currency note was not legal tender for a sum of less than one rupee, but I see no reason to differ from the finding on the facts reached by the Courts below and I must observe that the note was not rejected on the ground that it was not legal tender but on the ground that it was of no value Rule 34 of the rules made under the Defence of India Act contains a number of definitions. It defines a 'prejudicial act' as an act which is intended or is likely to produce certain results including an act to undermine public confidence in the national credit or in any Government loan or security or in any notes, coins or tokens which are legal tender in India. Rule 38 of the rules made under the Defence of India Act states that no person shall without lawful authority or excuse do any prejudicial act and further that any person who does such an act shall be punishable with imprisonment for a term which may extend to five years and shall also be liable to fine. It seems to me that any person who refuses to accept a currency note upon the ground that it is worth nothing, is certainly doing an act which tends to undermine public confidence in the note and that his action comes within the provisions of Rules 34 and 38.
2. The second argument addressed to us is that Section 34 or at least that part of Rule 34 with which we are dealing is a rule which the Government was not competent to make under the provisions of the Defence of India Act. Section 2 of this Act says in Sub-section (1) that the Central Government may by notification in the Official Gazette make such rules as appear to it to be necessary or expedient for securing the defence of British India, the public safety, the maintenance of public order or the efficient prosecution of war, or for maintaining supplies and services essential to the life of the community. It then goes on to say in Sub-section (2) that the rules may provide, without prejudice to the generality of the powers conferred by Sub-section (1), for certain matters set forth thereafter in detail. Learned Counsel has said that there is no matter in Sub-section (2) which covers a rule for the purpose of maintaining the credit of the Government of India or for safeguarding the confidence of the public in currency notes. Sub-section (2) of Section 2 of the Act clearly says that the provisions of that sub-section are without prejudice to the generality of the powers conferred by Sub-section (1) and it seems to me that there can be no doubt that it is necessary for the public safety and the maintenance of public order and the efficient prosecution of war to maintain the public confidence in the currency of the Government established by law in British India. I am satisfied, therefore, that the rule which concerns us was within the competence of the Central Government in accordance with the provisions of Section 2, Defence of India Act.
3. The third argument is that the Defence of India Act is itself ultra vires the Central Legislature which passed it into law. The suggestion is that the Legislature had no power to divest itself of its legislative authority and that by passing this Act it in effect did so. Learned Counsel referred us to the case in Empress v. Burah ('77) 3 Cal 63, but the decision in that case was the subject of an appeal and we are concerned more with the decision of their Lordships of the Privy Council. The report of their Lordships' decision is to be found in Empress v. Burah ('79) 4 Cal 172. Their Lordships confined themselves to the question which was involved in the case before them. It was a case where the Legislature had passed as Act and had conferred on the Lieutenant-Governor of Bengal the power to apply the Act from a date selected by him and to ex-tend it to certain areas other than those originally included in it. Their Lordships decided that there was nothing illegal in the action of the Legislature. An argument addressed to their Lordships was that the act of the Legislature was not legislation but was a delegation of legislative power. Their Lordships held that the argument was based on a mistaken view of the powers of the Indian Legislature and indeed of the nature and principles of legislation. They agreed that the Indian Legislature had powers expressly limited by the Act of the Imperial Parliament which created it but said that when the Legislature was acting within these limits it was not in any sense an agent or delegate of Imperial Parliament but was intended to have plenary powers of legislation, as large, and of the same nature, as those of Parliament itself. They said:
If what has been done is legislation within the general scope of the affirmative words which give the power, and if it violates no express condition, or restriction by which that power is limited.... it is not for any Court of justice to enquire further, or to enlarge constructively those conditions and restrictions.
4. Their Lordships agreed that the Governor-General in Council could not, by any form of enactment, create in India, and armed with general legislative authority, a new legislative power, not created or authorised by the Councils Act of the time but that nothing of that kind had in their Lordships' opinion been done or attempted in the ease before them. Learned Counsel for the applicant has argued that the Defence of India Act does in effect create a new legislative power not created or authorised by the Government of India Act. It seems to me, however, that the mere conferring of authority on some body to make rules does not amount to the creation of a new legislative authority. Learned Counsel has referred us to the case in In re Initiative and Referendum Act ('19) 6 A.I.R. 1919 P.C. 145 but that was a case in which the Legislature of Manitoba passed a statute providing that law for the province might be made and repealed by the direct vote of the electors instead of only by the Legislative Assembly whose members they had elected. It was held that the statute was ultra vires the Legislative Assembly because it compelled the Lieutenant-Governor to submit a proposed law to a body of voters totally distinct from the Legislature of which he was the constitutional head and would render himself powerless to prevent it from becoming an actual law if approved by those voters. The circumstances of that case were entirely different from the circumstances of the case before us. It seems to me that the question at issue is concluded by the decision of their Lordships of the Privy Council in Archibald G. Hodge v. The Queen (1884) 9 A.C. 117. That was a case in which a Legislature in Canada gave authority to a Board of Licensing Commissioners to make certain regulations in respect of the sale of liquor and to impose penalties for the breach of these regulations. Their Lordships in that case again pointed out that Provincial Legislatures were in no sense delegates of or acting under any mandate from the Imperial Parliament. They said that the Local Legislature was supreme within the limits of the subjects and areas in which it had authority and that its authority was the same as the Imperial Parliament would have under like circumstances to confide to a municipal institution or a body of its own creation authority to make bye-laws or resolutions as to subjects specified in an enactment with the object of carrying the enactment into operation and effect. They said that it was argued at the bar that a Legislature committing important regulations to agents or delegates effaced itself but that was not so. The Legislature retains its power intact and can, whenever it pleases, destroy the agency which it has created and set up another, or take the matter directly into its own hands. Their Lordships said:
How far it shall seek the aid of subordinate agencies, and how long it shall continue them, are matters for each Legislature and not for the Courts of law to decide.
5. Learned Counsel for the applicant has argued before us that the powers conferred by the Defence of India Act upon the Central Legislature are so wide that the Legislature has in effect created a new legislative authority. In my judgment, that is not so. It seems to me that the objection which learned Counsel urges to the Defence of India Act is psychological rather than logical. He is affected by the fact that the Central Government has been given authority to make rules about a wide range of subjects. If the power had been given in various statutes to make rules about these various subjects, it would probably not have suggested itself to anybody that the provisions were outside the power of the Legislature. Section 2 of the Act says that the power to make rules has been granted for certain specified purposes and I can see no reason why the Act should be ultra vires if any power to make rules can be entrusted by the Legislature to any body of persons. My conclusion is that there is no force in this application and I would reject it.
6. I agree. This is a matter which comes before us in revision from an order of the Sessions Judge of Saharanpur dismissing an appeal from the conviction by the first class Magistrate of Dehra Dun of one Meer Singh under Rule 38(1)(a), in respect of the breach by him of Rule 34 (6)(j) of the Defence of India Rules.
7. The facts are very simple. Meer Singh, a shopkeeper of Ferozepur, sold grain to a certain Earn Narain at his shop in the bazar for five annas and some odd pies. On being offered payment by a ten rupee currency note, Meer Singh refused to accept the note. I do not think it necessary to examine the facts at any great length because it is not the practice of this Court in revision to disturb a clear finding of fact by the lower Court in a ease in which, as in this one, there was prima facie evidence to support the finding. The learned Sessions Judge has found as a fact that the refusal by the accused to accept the ten rupee note was deliberate and was 'part of the financial panic' prevailing at the time. Mr. G. N. Kunzru, who has argued the case on behalf of Meer Singh, has pointed out that under Section 14, Paper Currency Act, (Act 10 of 1923), a ten rupee note is not legal tender for a sum of less than one rupee. That, however, is not in my judgment, a consideration which is decisive in relation to an alleged offence under the Defence of India Rules. The 'prejudicial acts' the doing of which are prohibited by B. 34 of the Rules are acts which are 'intended' or 'likely' to produce certain specified effects harmful (inter alia) to the prosecution of the war. Even an act which is a lawful act may infringe the rules, if the doing of it is 'intended' or is 'likely' to cause one of the effects mentioned in R. 34. The intrinsic 'lawfulness' of the Act is not the material consideration. The material consideration is whether the act, be it lawful or not, was 'intended' or 'likely' to have any of the effects which the Defence of India Rules have by R. 3i set out to guard against. It may possibly be that a man who does a lawful act may do it from a motive quite unconnected with any desire to hamper the prosecution of the war and in that way the lawfulness or otherwise of his act may have some relevance to the fact of his intention. But 'intention' is not the sole criterion. If the act is 'likely' to produce the prohibited result, it constitutes an offence whatever the intention may have been. I think, therefore, that the fact that Meer Singh may, under the Paper Currency Act, have been strictly entitled to refuse to receive the ten rupee note as legal tender, has no bearing on the 'likely' consequences of his act. As the learned Sessions Judge has found, his act was a deliberate one, inspired by a mistaken lack of confidence in the credit of the Government and in those circumstances, I find it impossible to disagree with his view that it was likely 'to undermine public confidence in the national credit.. or any notes, coins or tokens which are legal tender in India .' and that it was done without any lawful excuse or authority.
8. The applicant, has therefore, been driven to attack the Defence of India Act, and the Rules made under it, on other grounds. He says first that the rule in question is unnecessary and is not expedient for the defence of India or for any of the other purposes set out in Section 2, Defence of India Act. But the answer to that is that whether it is in fact necessary or expedient or not it has 'appeared' to the Central Government to be 'necessary or expedient' for the purposes specified, and that is all that is required by Section 2 itself. The next, and more substantial point taken is that the Act itself is ultra vires the Central Legislature, first because there is nothing in the Government of India Act, 1935 which vests in the Central Legislature power to legislate for the defence of India at all and secondly that even if there was, the manner of this particular legislation amounted to so complete an abandonment by the Legislature of its own law making function as in effect not to amount to the making by it of a law at all.
9. The former of these two contentions is, I think, founded on a fallacy. Statutes cannot be just classified, without examining them, by putting labels on them as a whole and calling one a 'defence' statute, another a 'fiscal' statute, a third a 'preservation of law and order' statute and so forth, and we cannot examine them, so to speak, 'in bulk.' What the Court has to do is to take the statute as it stands, with the rules made under it, and to see what is the particular provision (if any) of it, or of the rules, which, in reference to the actual circumstances of the case, can be said to be beyond the powers of the legislative body that created it. The Defence of India Act, and the rules made under it, must, for this purpose, be read as one piece of legislation. But they deal with many things and many kinds of acts. Indeed, Section 2, Defence of India Act itself enumerates the purposes for which the rules may be made and they include much more than the defence of British India and the prosecution of the war. They include the maintenance of public safety and of public order. The rules themselves deal with Acts immediately affecting the duties of soldiers and sailors and public servants, recruiting for His Majesty's forces, the police force and the fire brigades seditious acts, transport and locomotion, explosives, coinage and the ordinary criminal law. The Act and the rules create offences affecting many different heads of legislation, each one of which might, but for the inconvenience of such a course have been the subject of a separate Act under its appropriate subject. In dealing with a question of 'ultra vires' it is wise to bear in mind the recommendation of the Judicial Committee of the Privy Council in Citizens Insurance Company of Canada v. Parsons (1882) 7 A.C. 96 that in performing the difficult duty of determining such questions, it will be a wise course for those on whom it is thrown to decide each case which, arises as best they can, without entering more largely upon the interpretation of the statute than is necessary for the decision of the particular question in hand.
10. I think that if we do that in this case too, we shall be wise. I think that the right way to approach the question, therefore, is to address oneself to the question, not whether the Defence of India Act and Rules are, in the abstract, ultra vires, but whether the Central Legislature in passing an Act which, in the circumstances of this case, makes it an offence (among other things) to refuse the currency note in question has done something which, in the particular respect in which it is before us, it had no power to do. I do not think that it has. It has said that a currency note cannot be refused, if that refusal is intended or likely to have a certain consequence. That seems to me to be legislation relating to 'currency, coinage and legal tender,' notwithstanding that it may also tend towards the defence of India. The whole legislative field contained in Schedule 7, Government of India Act, 1935, was in the circumstances open to the Federal Legislature and, even if the general motive of the Defence of India Act and Rules as a whole was to defend India from His Majesty's enemies, I cannot see why the Central Legislature should on that account be precluded from exercising the power which it undoubtedly had of passing legislation relating to currency notes in India. The whole argument appears to me to be founded on a confusion of thought between the purpose or motive of the Legislature and the law itself which the Legislature has actually produced. If it were possible to say that, merely because an Act contains the word 'defence' in its title, it is, therefore, a 'defence' Act and, as such, 'ultra vires,' it seems to me that it would be possible to avoid many other domestic Acts as well upon the ground that they tended to strengthen India against her enemies. From nothing that I have said must it be assumed that, even had I been disposed to think that the particular prohibition referred to in Rule 34(6)(j) of the Defence of India Rules was a matter exclusively of 'defence,' I should have held that it was for that reason beyond the powers of the Central Legislature to pass it. On the view I have taken that question does not arise.
11. The second of Mr. Kunzru's two points is, at first sight, more attractive. It is, in short, that the Central Legislature derived its power to 'make laws' from the Government of India Act, 1935 (s. 99). It is then said that the manner in which the Defence of India Rules have been created does nofc amount to the making of a law by the Central Legislature at all, but rather to the making of a law by the 'Central Govenmenfc under a purported delegation by the Central Legislature of its own law making power, in short that the Central Legislature itself purported to constitute the Central Government as a fresh legislative body. The authority under which the Defence of India Rules have actually been made is that which is contained in Section 2(1), Defence of India Act:
2. (1) The Central Government may, by notification in the Official Gazette, make such rules as appear to it to be necessary or expedient for securing the defence of British India, the public safety, the maintenance of public order or the efficient prosecution of war, or for maintaining supplies and sorvices essential to the life of the community.
12. There then follows a long list of some thirty-five subjects for which, without prejudice to the generality of the power conferred by the section, the Central Government can make rules. Again, it has to be noticed that this list comprises many matters which are not in themselves necessarily matters of defence at all. We have, I think, in dealing with a question involving a consideration of the particular method to which the Legislature has thought fit to have resort in exercising its legislative function, to be careful not to 'be led into a criticism of the constitutional propriety of that method, instead of confining our attention to its strictly legal aspect. The question of constitutional propriety of legislative activity by an executive body under delegated powers is one which has been much debated in England in recent years, but is, I think, beside the point in this case.
13. All we have to consider here is whether the Legislature legally had power to bring about the creation of the Defence of the Realm Rules in the way it did, whether or not it might have been better done in some other way. The question, therefore, is whether, legally speaking, it was within the power of the Central Legislature, in a case in which, as I have already held, the subject-matter of the legislation was within its power, to effect its purpose by placing it in the hands of the Central Government to declare and create offences. In my view, the whole difficulty arises from a misuse of the term 'delegation'. This is not a case in which it can be said that anything had been done which is repugnant to the Constitution Act (the Government of India Act, 1935) itself, as, for instance in (1919) A.C 935, in which it was held that an Act of a State Legislature in Canada was invalid since it sought to restrict powers conferred by the Constitution Act itself. That is quitera different kind of case. The case before us is not one in which the Legislature is said to have exercised its legislative powers invalidly, in the sense that what it has done is repugnant to the substantive provisions of the Government of India Act, but is one in which it is suggested, as it seems to me, that in reality it has not exercised its own legislative power at all. But that must necessarily depend on whether, when a legislative body has been given an unfettered power to make laws on certain matters, that power includes the right to create the laws in question by any means which in its wisdom as a Legislature, it thinks proper, provided that it doss not efface itself altogether. I am inclined to think it can, though in the present case it has gone to the extreme limit of its powers. And, if that is so, then, as I see it, no question of 'delegation' really arises, because the Legislature has, in fact delegated nothing, but has itself exercised its own right to achieve its end by a means which was all the time within its power. It is the method alone which is in question.
14. I think that, on the whole, this view finds support, from the well known case in Archibald G. Hodge v. The Queen (1884) 9 A.C. 117 in which the Judicial Committee of the Privy Council considered a somewhat similar, though possibly less extreme case in which a State Legislature in Canada created laws and declared penalties through a licensing Board. In that case by the Liquor License Act of 1877 the State Legislature provided for a Board of Licensing Commissioners to whom it gave power by resolution to regulate and determine matters relating to tavern licenses and in particular to create offences in relation to its regulations. This the Commissioners purported to do and one of the questions before the Judicial Committee was whether the State Legislature could 'devolve or delegate these powers to the discretion of a Local Board of Commissioners.' In that case, their Lordships of the Privy Council expressed the view that the powers intended to be conferred by the Act in question, when properly understood, were to make regulations in the nature of police or municipal regulations of a merely local character. But their actual decision was, I think, placed on a broader basis than that. Their Lordships say:
It appears to their Lordships, however, that the objection thus raised by the appellants is founded on an entire misconception of the true character and position of the provincial legislatures. When the British North America Act enacted that there should be a Legislature for Ontario, and that its legislative assembly should have exclusive authority to make laws for the Province and for provincial purposes in relation to matters enumerated in Section 92, it conferred powers not in any sense to be exercised by delegation from or as agents of the Imperial Parliament, but authority as plenary and as ample within the limits prescribed by S, 92 as the Imperial Parliament in the plenitude of its power possessed and could bestow. Within these limits of subjects and area the local Legislature is supreme, and has the same authority as the Imperial Parliament or the Parliament of the Dominion would have had under like circumstances to confide to a municipal institution or body of its own creation authority to make by-laws or resolutions as to subjects specified in the enactment, and with the object of carrying the enactment into operation and effect.
15. I think that that applies with as much force to the legislative position of the Central Legislature in India created by the Government of India Act, 1935 as it does to the Legislature of Ontario created by the British North America Act of 1867. Once it is conceded that the legislative authority exists, it is a 'plenary' authority as 'ample' within the sphere entrusted to it as that of the Imperial Parliament itself. And if that is so and the subject-matter is within the ambit of that authority, then, provided it is legislation at all, it is difficult to see what limits can be put upon it. If the Legislature abrogates its own powers of legislation altogether and surrenders them to another, then the product ceases to be legislation of the power in any sense. Their Lordships say:
It was argued at the bar that a Legislature committing important regulations to agents or dele-gates effaces itself. That is not so. It retains its powers intact, and can, whenever it pleases, destroy the agency it has created and set up another, or take the matter directly into its own hands....
16. While I find it difficult to say that the present instance of 'committing important regulations to agents or delegates' is not an extreme one, I am inclined to think that, upon the principles by which the Judicial Committee has guided itself in Archibald G. Hodge v. The Queen (1884) 9 A.C. 117, it cannot be said that the Central Legislature has 'effaced' itself or attempted to transfer its own power of legislation to the Central Government. As their Lordships have pointed out, the control of the Legislature remains. I think that it is perhaps accurate to put it in this way that the Central Legislature, being a legislative body to which the Imperial Parliament has committed a plenary power of legislation in the' matter in question has, as a Legislature, exercised that power by a familiar method of its own choice and that in so doing has itself 'made the laws' in question within the meaning of Section 99(1), Government of India Act, 1935. I do not think it possible to draw any line in the case with which we are dealing between rules which are designed merely 'with the object of carrying the enactment into operation and effect' and those which themselves contain the substantive law. For these reasons, I agree in thinking that this revision should be dismissed.
17. By the Court. - The application in revision is dismissed. The applicant will surrender to his hail and serve out his sentence. We certify in accordance with Section 205(1), Government of India Act, 1935, that this ease involves a substantial question of law as to the interpretation of the Government of India Act, 1935, inasmuch as the question at issue is whether the powers of the Central Legislature derived from the Act extend to the making of the Defence of India Act and the Rules in the form in which they have been passed into law.