Monday, 7 February 2022

Center-state Relations


Centre- state relation 

There are two forms of government, that is unitary and federal form.

In unitary form there are, maximum power or only source of power lies with state, it classic example of this form of government are France Japan, China. While federal form of government, the powers are divided between both centre & state its example is UNITED states and India.

At the time of emergency India follow unitary form of government

Which means centre has more power than the state government has less powers, otherwise during normal time India has a federal form of government.  The main features of federal form of the government are the division of the power between centre and the states. In our constitution the power between centre & states is divided under 3 heads, 

Legislative relations, in the constitution from Article 245 to Article 255 of the relations of centre and state, have been divided in 2 aspects that is territorial and subject matter jurisdiction. In territorial jurisdiction means who can make law applicable over a over certain and specific territory, while subject matter jurisdiction refers to subject matter of law be it agriculture, electricity, water projects, etc. In territorial jurisdiction it forms here that how is territorial jurisdiction is decided, the most important article is article 245 it has two classes to this article 

Firstly, it says that parliament has the power it means centre and legislature is the main state. It say parliament has power to make laws for the entire territorial of India or for some part of it. 

Secondly it says that state legislative has the power to make laws for the entire territory of that state or part of territory of that state. 

Thirdly it says about extra territorial operations, it means the parliament possesses to make laws, it does not mean that parliament can make laws only fir people residing in India or Their property, it’s not parliament also possesses extra territorial jurisdiction meaning those persons or those properties situated outside India parliament can govern them as well. This extra territorial power is only possessed by the parliament and not by the state, but in case where parliament makes extra territorial for a person residing outside India and their property, in this the question comes as how will it be determined if the law is right or wrong? It can be understood by territorial nexus test Wallace v. ITC, Bombay AIR 1948 PC 118 it is a famous case for of company law it happened that there was a company registered in England, now this company was a partner of an Indian firm. Indian text authority wanted to tax the entire income of this company-it was said that since the major income of this company comes from India that why Indian tax authority has the power to tax that income. So, the territorial nexus test says that of parliament wants to make more law than the subject matter which such a law is to govern there must be a reasonable connection between both. Similarly, state has the power to make law for whole of the state or some part of it.

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