(3) Taxation is considered to be a distinct matter for purposes of legislative competence. There is a distinction made between general subjects of legislation and taxation. The general subjects of legislation are dealt with in one group of entries and power of taxation in a separate group. The power to tax cannot be deduced from a general legislative entry as an ancillary power.
(4) The entries in the lists being merely topics or fields of legislation, they must receive a liberal construction inspired by a broad and generous spirit and not in a narrow pedantic sense. The words and expressions employed in drafting the entries must be given the widest- possible interpretation. This is because, to quote V. Ramaswami, J., the allocation of the subjects to the Lists is not by way of scientific or logical definition but by way of a mere simplex enumeratio of broad categories. A power to legislate as to the principal matter specifically mentioned in the entry shall also include within its expanse the legislations touching incidental and ancillary matters. (5) Where the legislative competence of the Legislature of any State is questioned on the ground that it encroaches upon the legislative competence of Parliament to enact a law, the question one has to ask is whether the legislation relates to any of the entries in List I or III. If it does, no further question need be asked and Parliament's legislative competence must be upheld. Where there are three Lists containing a large number of entries, there is bound to be some overlapping among them. In such a situation the doctrine of pith and substance has to be applied to determine as to which entry does a given piece of legislation relate. Once it is so determined, any incidental trenching on the field reserved to the other Legislature is of no consequence. The court has to look at the substance of the matter. The doctrine of pith and substance is sometimes expressed in terms of ascertaining the true character of legislation. The name given by the legislature to the legislation is immaterial. Regard must be had to the enactment as a whole, to its main objects and to the scope and effect of its provisions. Incidental and superficial encroachments are to be disregarded.
173. The doctrine of pith and substance can be applied to examine the validity or otherwise of a legislation for want legislative competence as well as where two legislations are embodied together or achieving the purpose of the principle Act. Keeping in view that we are construing a federal Constitution, distribution of legislative powers between the Centre and the State is of great significance. Serious attempt was made to convince the Court that the doctrine of pith and substance has a very restricted application and it applies only to the cases where 18 the Court is called upon to examine the enactment to be utra vires on account of legislative incompetence.
175. In Union of India v. Shah Goverdhan L. Kabra Teachers' College this Court held that in order to examine the true character of the enactment, the entire Act, its object and scope is required to be gone into. The question of invasion into the territory of another legislation is to be determined not by degree but by substance. The doctrine of pith and substance has to be applied not only in cases of conflict between the powers of two legislatures but also in any case where the question arises whether a legislation is covered by a particular legislative field over which the power is purported to be exercised. In other words, what is of paramount consideration is that the substance of the legislation should be examined to arrive at a correct analysis or in examining the validity of law, where two legislations are in conflict or alleged to be repugnant.
36. The contention of the petitioners that by enacting the Prasar Bharti Act and amending Finance Act, 1994, imposing tax on service, the Union Legislature has occupied the said field, denuding the State Legislature the power to levy tax on the activity of 24 entertainment is without any substance. However, though there could not be overlapping in law in respect of respective legislative fields available to both the Legislature but overlapping or incidental encroachment may result in fact. In order to determine whether the State Legislation has invaded into the territory of another legislation, the Doctrine of Pith and Substance is to be applied. According to the principle laid down in the case referred earlier in the case of M/s Hoechst Pharmaceuticals Ltd &ors.;, Kesoram Industries Ltd. and others asalsointhecaseofGirnar Traders Vrs. The State of Maharashtra(supra), the Doctrine of Pith and Substance has to be applied not only in case of conflict between powers of the two Legislatures but also in any case where the question arises as to whether the legislation is covered by particular legislative field over which the power is purported to be exercised. What is of paramount consideration is substance of the legislation which is to be examined to arrive at a correct analysis.