CONSTITUTIONAL ASPECTS

By K.S.Naveen Kumar, Advocate, Bangalore

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MODULE 1

1. What is law

2. Scholars views about law

3. Significance of law

• Objective : To understand the basic description of law and its significance

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WHAT IS “LAW”?Law is nothing but a bundle of common

sense.

Technical sense:

A set of rules and procedures to be followed in general by the members of public or particular section of the society. Eg. Traffic Rules and criminal law, Advocates Act and CAs Act.

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ABOUT LAW….• “Rules of conduct enforced by the

State to maintain peace and order in the society”

• “The system of rights and obligations which the State enforces”.

Scholar’s views:Austin – Law is a rule of conduct

imposed and enforced by the sovereign.

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SCHOLAR ‘S VIEW ABOUT LAW

• Salmond – Law is the body of principles recognized and applied by the State in the administration of justice.

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SIGNIFICANCE OF LAW• Why law:‘Law is like oxygen in air, people would not realize its

importance unless it is withdrawn’.

Man lives in a society – Social animal. Does not live in isolation. Other individuals also co-exist. Rights and obligations to be defined to maintain peace, law and order.

Every right has a corresponding obligation.Eg. Listening to music (nuisance – noise pollution), Peaceful

enjoyment of property (Trespass), Parking.

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SIGNIFICANCE OF LAWIn life or business – survival of the

fittest. Without law it would be survival of the most ruthless.

Law – makes rights secure.

Rule of man will prevail without law (eg. If discretion of tax collection is vested with an officer without any legal basis – subjects will be exposed to arbitrary, capricious and whimsical exercise of power).

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MODULE 2• Source of Law

• Tax - historical background

• Nature of tax

• Objective: (a) To know from where law emerges.

• (b) To briefly understand history of taxation and its nature 8

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LAW… SOURCES OF LAW…

• Currently:a. Legislation i.e. Acts of Parliament and State Legislatures.b. Rules made by Government authorities.c. Judgments i.e. case laws.d. Customs and usages.

Olden times:a. Scriptures.b. Customs and usages.c. Ruler’s / King’s mandate/ verdict. 9

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• 2000 years ago – Decree from Augustus Caesar that all the world should be taxed.

• Taxes in Greek, Roman and German Empire

• Basis of turnover or occupation

• Manu Smriti and Arthasastra – refers to variety of tax measures

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• Kautilya (Chanakya or Vishnu Gupta) – Arthasastra.

• Major portion devoted to financial matters including financial administration.

• Arthasastra – first authoritative text on public finance, administration and fiscal laws in this country.

• Bhaga, Bali, Kara, Vivita, Hiranya, Rajju, Chora Rajju

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• Manu said: - Taxes should be related to the

income and expenditure of the subject.- Either complete absence of taxes or

Exorbitant taxation should be avoided.

- King should arrange the collection of taxes in such a manner that the subjects do not feel the pinch of paying taxes. 12

Mughal rule – taxes prevailedBritishers levied various taxes

It was only for the good of his subjects that he collected taxes from them, just as the Sun draws moisture from the Earth to give it back a thousand fold – Kalidas

“ The hardest thing in the world to understand is the income-tax” – Albert Einstein

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Essential characteristics of a taxNot a voluntary payment or donationEnforced contribution exacted pursuant to legislative authority, in exercise of taxing power.

Imposed, levied and collected for the purpose of raising revenueUsed for public or governmental purposes and not for payment for some special privilege granted or service rendered

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Module 3

• Constitution• Context and background• Preamble• Fundamental duties• Fundamental rights• Important Articles w.r.t. taxation• Lists – legislative fields w.r.t. taxation

Objective: To examine few basic aspects of constitution, which are relevant to indirect

taxes

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FUNDAMENTAL DUTIES – Article 51A: It shall be the duty of every citizens of India: -

To abide by the Constitution and respect its ideals and institutions, the National Flag and the National Anthem;

• To cherish and follow the noble ideals which inspired our national struggle for freedom;

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To uphold and protect the sovereignty, unity and integrity of India;

To defend the country and render national service when called upon to do so;

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• To promote harmony and the spirit of common brotherhood amongst all the people of India transcending religious, linguistic and regional or sectional diversities; to renounce practices derogatory to the dignity of women;

• To value and preserve the rich heritage of our composite culture;

• To protect and improve the natural environment including forests, lakes, rivers and wild life, and to have compassion for living creatures;

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• To develop the scientific temper, humanism and the spirit of inquiry and reform;

• To safeguard public property and to abjure violence;

• To strive towards excellence in all spheres of individual and collective activity so that the nation constantly rises to higher levels of endeavour and achievement.

• Who is a parent or guardian to provide opportunities for education to his child or, as the case may be, ward between the age of 6 and 14 years.

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Fundamental Rights

• Article 13 – Laws inconsistent with or in derogation of the fundamental rights – void

Right to Equality

Article 14 – Equality before law

Article 15 – Prohibition of discrimination on grounds of religion, race, caste, sex or place of birth

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Fundamental Rights….

• Art.16 – Equality of opportunity in matters of public employment

• Art.17 - Abolition of untouchability

• Art.18 – Abolition of Titles

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Fundamental Rights ….

RIGHT TO FREEDOM

• Art.19 – Protection of certain rights regarding freedom of speech and expression, assemble peaceably and without arms, form associations or unions, movement throughout territory of India, practise profession and carry on occupation, trade or business. etc.

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Fundamental Rights…

• Art.20 – Protection in respect of conviction for offences

‘No person shall be convicted of any offence except for violation of the law in force at time of commission of the act charged as an offence, nor be subjected to a penalty greater than that which might have been inflicted under the law in force at the time of the commission of the offence’ – Art.20(1)

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Fundamental Rights…

• Art.20(2) – “No person shall be prosecuted and punished for the same offence more than once.”

• Art.20(3) – “No person accused of any offence shall be compelled to be a witness against himself.”

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Fundamental Rights…

• Art.21 – Protection of life and personal liberty – No person shall be deprived of his life or personal liberty except according to procedure established by law.

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Fundamental Rights…

• Art.21A – Right to Education

• Art.22 – Protection against arrest and detention in certain cases

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Fundamental Rights…

• RIGHT AGAINST EXPLOITATION

• Art.23 – Prohibition of Traffic in human beings and forced labour

• Art.24 – Prohibition of employment of children in factories etc.

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Fundamental Rights….

• RIGHT TO FREEDOM OF RELIGION

• Art.25 – Freedom of conscience and free profession, practice and propagation of religion

• Art.26 – Freedom to manage religious affairs

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Freedom rights …

• Art.27 – Freedom as to payment of taxes for promotion of any particular religion

• Art.28 – Freedom as to attendance at religious instruction or religious worship in certain educational institutions.

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Fundamental Rights…

• CULTURAL AND EDUCATIONAL RIGHTS

• Art.29 – Protection of interests of minorities

• Art.30 – Right of minorities to establish and administer educational institutions

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Fundamental Rights…

• RIGHT TO CONSTITUTIONAL REMEDIES

• Art.32 – Remedies for enforcement of rights conferred by this part

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India – discovered in new ST law!!

• India – section 65B(27) - (27) "India" means,-• (a) the territory of the Union as referred to in clauses

(2) and (3) of article 1 of the Constitution;• (b) its territorial waters, continental shelf, exclusive

economic zone or any other maritime zone as defined in the Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976; (80 of 1976.)

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India….

• (c) the seabed and the subsoil underlying the territorial waters;

• (d) the air space above its territory and territorial waters; and

• (e) the installations, structures and vessels located in the continental shelf of India and the exclusive economic zone of India, for the purposes of prospecting or extraction or production of mineral oil and natural gas and supply thereof;

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Distribution of Legislative Powers

• Art.245 – Extent of laws made by Parliament and by the Legislatures of States

• Art.246 – Subject matter of laws made by Parliament and by the Legislature of States

• Art.248 – Residuary powers of legislation

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• Art.265 – No tax shall be levied or collected except by authority of law.

• Art.285 – Exemption of property of the Union from State taxation

• Art.289 – Exemption of property and income of a State from Union taxation

• Art.300A – Persons not to be deprived of property save by authority of law

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Three organs of the State

• Parliament/Legislature

• Judiciary

• Executive

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• Art.226/227 – Writ Petition - Types

• Types of writ – mandamus, certiorari, prohibition, quo-warranto, habeas corpus

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Art.366 - Definitions

• Art.366(28) – taxation includes the imposition of any tax or impost, whether general or local or special, and ‘tax’ shall be construed accordingly.

• Art.366(29A) – deeming fiction of sale or purchase of goods – 46th amendment - 1982

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• Union List – few entries• 82 – Taxes income other than

agricultural income

• 83 – Duties of customs including export duties

• 84 – Duties of excise on tobacco and other goods manufactured or produced in India except: 40

• (a) alcoholic liquors for human consumption;

• (b) opium, Indian hemp and other drugs and narcotics,

• but including medicinal and toilet preparations containing alcohol or any substance including in sub-paragraph (b) of this entry

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• 85 – Corporation Tax

• 92A – Taxes on sale or purchase of goods other than newspapers, where such sale or purchase takes place in the course of interstate trade or commerce

• 92B – Taxes on consignment of goods where such consignment takes place during interstate trade or commerce.

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• 92C – Tax on services (not yet effective).

• 97 – any other matter not included in List II, III and any tax not mentioned in list II or III (residual powers)

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• 46 – Taxes on agricultural income

• 51 – Excise duty on alcoholic liquors, opium and narcotics

• 52 – Tax on entry of goods into a local area for consumption, use or sale therein (usually called octroi)

•54 – Tax on sale or purchase of goods other than newspapers except tax on interstate sale or purchase 44

• 35 – Mechanically propelled vehicles including the principles on which taxes on such vehicles are to be levied.

• 44 – Stamp duties other than duties or fees collected by means of judicial stamps, but not including rates of stamp duty

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Importance of constitution – events/persons (N.A.Palkhivala &

Justice M.N.Venkatachaliah)

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About Constitution

• “If the Constitution is to be taken seriously, the interpretation and fulfillment of these general objects of policy will raise great difficulties for legislatures, and these difficulties will bring the Constitution, the Courts and the Legislature into conflict and disrepute. If these declarations are, however, to be treated as ‘words’ they will bring discredit upon the Constitution also – Prof.Wheare

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QUERIES ???

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for your unconditional and committed listening

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