CMA Foundation Study Material Business Laws Paper 1 Lesson 1.4

Prepare for your CMA Foundation Paper 1 Business Laws and Business Communication. using our CMA Foundation Study Materials. Here is Lesson Lesson 1.4: Primary and Subordinate Legislation.

In Lesson 1.4 of the CMA Foundation Paper 1, you will learn about how law making is categorized for easy regulation.

The activities of the government extend into almost every sphere of human life. This naturally creates the need for laws to regulate these activities. However, it is not possible for the Union Legislature or the State Legislature to handle every single detail of law-making. Therefore, law-making has been divided into two categories—Primary Legislation and Subordinate (or Secondary) Legislation.

Primary Legislation

Primary legislation refers to the laws passed directly by Parliament or the State Legislatures. These bodies are given law-making power by the Constitution of India, 1950.

Examples include the Indian Penal Code, the Companies Act, and the Goods and Services Tax Act. In addition to these, the President of India and the Governor of a State also have limited powers to issue ordinances when the legislature is not in session.

The key feature of primary legislation is that it provides the broad framework of law. It has the highest authority, and subordinate legislation must always work within its boundaries.

For example, the Parliament may pass a law on environmental protection, but the specific rules regarding pollution control will be framed by delegated authorities under that law.

Subordinate Legislation

Subordinate or secondary legislation arises from the need to empower authorities to handle details at a more practical and local level. The legislature delegates power to subordinate bodies or officials to make rules, regulations, notifications, or bye-laws. This is why it is also called delegated legislation.

For example, the Reserve Bank of India issues regulations for banking operations under the Banking Regulation Act, and municipalities make by-laws for sanitation and public health under state laws. These regulations and by-laws are valid because the legislature has authorized such authorities to create them.

The importance of subordinate legislation lies in its flexibility. Unlike Parliament or State Legislatures, which take time to pass laws, subordinate authorities can issue rules quickly and revise them whenever needed. This was clearly seen during the Covid-19 pandemic, when frequent changes in guidelines and regulations were required. Subordinate legislation makes it possible to issue localized instructions rapidly without waiting for Parliament or State Legislatures to meet.

However, subordinate legislation has limits. It must always remain within the scope of the parent Act and the Constitution. If it goes beyond this or contradicts the basic law, the courts can strike it down as ultra vires (beyond powers).

Constitutional Provisions

The Constitution of India itself recognizes subordinate legislation.

• Article 13(3)(a) – The word law includes ordinances, orders, bye-laws, rules, regulations, notifications, customs or usages that have the force of law in India. This means even rules and regulations made by authorities (not just Acts of Parliament) are considered law.
• Article 312 – Parliament can create All India Services (like IAS and IPS) if the Rajya Sabha passes a resolution with at least a two-thirds majority.
  This shows how power can be delegated for administrative efficiency across both Union and States.
• Part IX and Part IXA – These deal with Panchayats and Municipalities. They are given powers to make rules and regulations for local governance. They are among the biggest sources of subordinate legislation because local rules need frequent updating.

Conclusion

In this lesson, we learned that primary legislation gives the basic framework of law, while subordinate legislation fills in the details and provides flexibility. Both are essential for smooth governance in a large and diverse country like India.

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In the next section, you can move on to Chapter 2, which deals with the Indian Contract Act, 1872.

Make sure to test your knowledge and understanding of this lesson by taking advantage of our MCQ Practice Questions (MCQs).

Let us know if you have any questions or doubts in the comments section.