The battle for Indian Federalism: Government of NCT of Delhi vs. Union of India

In a prolonged legal battle, so far leaning towards the fundamental principles of federal accountability, the Union government under Modi 2.0 digs its heels in, tries to upset a constitutional bench hearing of the Supreme Court; now in this penultimate stage as the case, again comes before the apex court, challenging the May 2023 Ordinance hastily passed through Parliament, we witness one more battle for democratic accountability being fought in the Indian courts.

The Supreme Court’s five judge constitution bench delivered a judgement on May 11, 2023 regarding the demarcation of powers between the National Capital Territory (NCT) of Delhi and the Union Government, with respect to Services, as mentioned in Entry 41 of the Seventh Schedule.

This article provides an overview of what has occurred until now in this case including the judgement. Before we delve into the proceedings and the judgement, there are some provisions of the Constitution that should be discussed.

Provisions to understand:-

First among such provisions is the Seventh Schedule (VIIth) of the Constitution. The Seventh Schedule has three lists. List I-also known as Union List. List II- also known as State List. List III- Also known as Concurrent List.

Article 246 of the Constitution states that Parliament has exclusive power to make laws on subject enumerated in List I of the Seventh Schedule; States have the exclusive power to make laws on subjects enumerated in List II and finally, both centre and states can makes laws on subjects enumerated in List III with centre’s laws superseding state’s laws if there is a conflict, as a general rule. In essence, there are three lists and in State and Centre has exclusive control over one list each and over concurrent list, Centre has more control.

The second provision is Article 239AA of the Constitution which gives the name National Capital Territory of Delhi (NCT) to the Union of Territory of Delhi while mandating that a legislative assembly elected directly by council of ministers be there in NCT. Article 239AA (3)(a) states that the legislative assembly shall have power to make laws for the whole or any part of the National Capital Territory with respect to any of the matters enumerated in the State List or in the Concurrent List in so far as any such matter is applicable to Union territories except matters with respect to Entries 1, 2 and 18 of the State List and Entries 64, 65 and 66 of that List in so far as they relate to the said Entries 1, 2 and 18.

In essence. Delhi should have a legislative assembly directly elected by its people even though it is a Union Territory. The state government of Delhi can make laws on State and Concurrent lists but cannot make laws on some subjects even though they are under State List. Those subjects are Police, Public Order and Land.

The third set of provisions is Article 73 and Article 162 of the Constitution. Article 73 states that the Union’s executive power extends to all those subjects on which the Parliament can make a law under List I. For example, Citizenship is a Central Subject. Only Parliament can make a law on it. Therefore, co-extensively, the Union can bring out a notification-exercising its executive power-on the issue of citizenship. Article 162 does the same with respect to states i.e., the extent of state’s executive power is the extent of power of legislature of the state.

And finally, Part XIV of the Constitution deals with services under Union and States. This part has all the provisions related to All India Services etc. however it does not mention Union Territories.

Facts

In 2015, the Union Home Ministry issued a notification which provided that the Lieutenant Governor of NCTD (An agent of the President according to the Constitution) shall exercise control “to the extent delegated to him from time to time by the President” over “services”, in addition to “public order”, “police”, and “land.” The Lieutenant Governor may seek the views of the Chief Minister of NCTD at his “discretion”.

Now the issue that arose in the case decided in May 2023 is that ‘services’ is an entry under List II [Entry 41]. The government’s rationale is as follows, for this exclusion:

The 1st line of reasoning is that- Part XIV- which deals with services- does not mention Union Territories. This means that Union Territories do not have special powers with respect to services since they will be exercised directly by the Centre.

Building on this, the second line of reasoning is that, under Article 239AA (3)(a)- the Delhi Legislative Assembly can only legislate on matters that are exclusively given to Union Territories. The government relied on the phrase “in so far as any such matter is applicable to Union territories” in the provision that says “legislative assembly shall have power to make laws for the whole or any part of the National Capital Territory with respect to any of the matters enumerated in the State List or in the Concurrent List in so far as any such matter is applicable to Union territories.”

Since the state government cannot have executive power over matters it cannot legislate on, the Union argued that the exclusion of services from state government’s prerogative was justified. This has been the broad argument of the Union government since 2015.

What happened after the notification in 2015?

When the government of Delhi approached the Delhi HC, The Delhi High Court ruled that the Legislative Assembly of the National Capital Territory of Delhi (NCTD) does not have the power to make laws on services. The court held that the phrase “insofar as any such matter is applicable to Union Territories” in Article 239 AA (3) (a) of the Constitution of India excludes services from the legislative and executive domain of the NCTD.

On appeal, the Supreme Court referred the issue of interpretation of Article 239AA to a Constitution Bench.

The Constitution Bench held in 2018 that the NCTD is not similar to other Union Territories and the constituent power of Parliament was exercised to treat the Government of NCTD as a representative form of Government. The Constitution Bench further held that the executive power of NCTD is co-extensive with its legislative power, that is, it shall extend to all matters with respect to which it has the power to legislate. The Constitution Bench also held that Parliament has the power to make laws with respect to all subjects in List II and III for the NCTD. The Constitution Bench held that the phrase “insofar as any such matter is applicable to Union Territories” is an inclusive term, and “not one of exclusion”. After solving the constitutional question, the appeals were placed before a two-judge bench.

In 2019, a two-Judge bench delivered two separate judgments. The judges differed on whether “services” are excluded in view of Article 239-AA (3)(a) from the legislative and executive domain of GNCTD.

Justice Ashok Bhushan held that the majority opinion in the 2018 Constitution bench judgment did not interpret the phrase “insofar as any such matter is applicable to Union Territories” correctly. He held that the phrase should be interpreted as excluding services from the legislative and executive domain of the NCTD.

The matter fell for consideration before a Bench of three Judges. The three-judge bench referred the specific issue relating to scope of legislative and executive powers of the Centre and NCT Delhi with respect to the term “services” to this constitution bench.

Arguments of the Petitioner- Delhi Government

The petitioners argued that:

• The Part XIV of the Constitution applies to Union Territories too, as recognised by the Supreme Court in the case of Union of India vs. Prem Kumar Jain.
• The phrase “in so far as any such matter is applicable to Union territories” is facilitative in nature which permits such entries being made available to the Union Territory of NCTD without an amendment of the Lists in the Seventh Schedule.
• NCTD is not like all other union territories; it has a special status.

Arguments of the Respondent- Union Government

• Entry 41 of List II is not available to Union Territories, as it cannot have either a State Public Service or a State Public Service Commission.
• The expression “in so far as any such matter is applicable to Union Territories” in Article 239AA means that the entries contained in List II are available to NCTD to the limited extent to which they are applicable to Union Territories. The legislative powers of NCTD shall extend to only those matters which are ‘applicable’ to Union Territories.

Judgement

Firstly, the May 2023 judgement stated that the National Capital Territory of Delhi (NCTD) cannot be treated as any other Union Territory. When we compare Article 239AA-which deals with Delhi and Article 239A which deals with Union Territory of Puducherry-Article 239AA mandates that Delhi shall have a directly elected government and legislature. This gives a special status to Delhi in the framework of representative democracy.

Secondly, the judgement stated that the NCTD has legislative powers over all of State List and Concurrent List except Police, Public Order and Land whereas the Parliament has legislative powers over State List including Police, Public Order & Land, and the Concurrent List. However, the executive power of the Union only extends to the three exceptions. Since the state has power to legislate over List II except the three entries-the state will also have executive power with respect to the List II except those three entries. List II includes services and therefore, the NCTD will have the executive and legislative power over services that do not pertain to Police, Public Order and land, according to the judgement.

The judgement, essentially stated:

On different arguments advanced by the Union government proposing a “balance”, the Supreme Court stated that there exists ample balance between the powers of the state and the powers of the Union since the Parliament can override any provision of the state legislature, as provided by the Constitution, keeping in mind the national capital status of Delhi.

The court also stated that in a federal polity, accountability is a must, and, in this scheme, the Civil Service Officers will be accountable to the Minister, the Ministers will be accountable to the Legislature and the Legislature is accountable to the Electorate. If the exclusion of Services is allowed, in this context, the NCTD will not have an accountable bureaucracy while being accountable to the electorate.

Conclusion

This judgement reaffirms the federal character as part of basic structure of the Constitution and provides a balance between the NCTD’s democratic character and the national interest of having National Capital under the Union with respect to important areas of legislation.

However, in a brazen act, within one week of Supreme Court’s judgement, the Union government issued a notification giving primacy to the Lieutenant Governor (an appointee of the Union Government) in transfer and postings of civil servants serving the Delhi Government, contrary to the Supreme Court’s judgement saying that the services will be under the Delhi Government unless they are regarding Police, Public and Land.

Delhi Chief Minister Arvind Kejriwal has been touring opposition ruled states and has been meeting with opposition leaders to garner support to defeat the bill when it is tabled in the Parliament.

(The author is a legal researcher with the organisation)

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