[1]

Introduction
Fundamental rights are a group of rights which are guaranteed to all the
citizens of the nation by the Constitution of India under Part III. These rights
apply universally to all citizens residing in the nation, irrespective of their race,
place of birth, religion, caste or gender. They are recognized by law as rights
requiring a high degree of protection from the government and they cannot be
violated by the Government. Fundamental rights cannot be enforceable against
individuals and private entities.  The obligation of protecting these rights lies on
the government or the state or its authorities.

Most of the Fundamental rights provided to the citizens are claimed

against the State and its instrumentalities and not against the private bodies.
Article 12 gives an extended significance to the term ‘state’. It is very important
to determine what bodies fall under the definition of a state so as to determine
on whom the responsibility has to be placed.

The framers of the Constitution used the words ‘the State’ in a wider sense than
what is understood in the ordinary or narrower sense. It does not merely mean
the states in the Union. The word ‘includes’ in the article shows that the
definition is not exhaustive and through judicial interpretations, the court has
widened the scope of the Article way beyond what even the framers of Article
12 may have had in mind during the framing of the constitution.
 [2]

Meaning of State under Article 12 of the Constitution of India

Since India is a modern Welfare State, its functions have been increased
over the period of time. The Indian State has to draft and implement welfare
policies and schemes. Furthermore, the Government needs the assistance of
different departments, agents, and private bodies or individuals, for performing
essential public functions. However, the State cannot escape from their
responsibility to protect individuals’ fundamental rights.

Currently, many private bodies and individuals engage in various

commercial & non-commercial activities and perform numerous functions of
public importance affecting individuals’ fundamental rights. But due to lack of
broadest meaning of State, an individual could not enforce his or her
fundamental rights against these private or non-state actors.

In the Indian Constitutional Scheme almost all of the fundamental rights

are available against the State. Article 12 of the Constitution of India defines
State to include the Government & Parliament of India, the Government & the
Legislature of each of the States, all local authorities, and other authorities
within the territory of India or under the control of the Government of India.
The most problematic expression under Article 12 of Constitution of India
is other authorities as this expression is not defined in the Constitution of India.
Thus, it is for the Courts to interpret this term, and it is clear that the wider this
term is interpreted, the wider the ambit of fundamental rights would be.
Executive and legislature of Union and states include union and state
governments along with Parliament and State legislatures. The President of
India and Governors of states can also be referred as ‘State’ as they are a part of
the executive. The term ‘government’ also includes any department of
government or any institution under its control. The Income Tax Department
and the International Institute for Population Sciences could be cited as
examples. ‘Local authorities’, as used in the definition, refers to municipalities,
Panchayats or similar authorities that have the power to make laws &
regulations and also enforce them. The expression ‘Other authorities could refer
to any entity that exercises governmental or sovereign functions.
 [3]

State Under Indian Constitution

Part III of the Constitution deals with Fundamental Rights which are the
restriction on the power of the legislature, executive and judiciary, that, no one
can encroach upon this part. In order to define the scope of these rights and the
scope of remedy under Article 32 constitution makers have defined “State” in
the beginning as under:
“the Government and the Parliament of India and the Government and the
Legislature of each of the State and all local or other authority within the
territory of India or under the control of the Government of India”
Therefore, to understand the expanded meaning of the term “other authorities”
in Article 12, it is necessary to trace the origin and scope of Article 12 in the
Indian Constitution. Present Article 12 was introduced in the Draft Constitution
as Article 7. While initiating a debate on this Article in the Draft Constitution in
the Constituent Assembly, Dr. Ambedkar described the scope of this Article and
the reasons why this Article was placed in the Chapter on fundamental rights as
followed:
The object of fundamental rights is twofold. First, that every citizen must be in a
position to claim those rights. Secondly, they must be binding upon every
authority – I shall presently explain what the word ‘authority’ means – upon
every authority which has got either the power to make laws or the power to
have discretion vested in it. Therefore, it is quite clear that if the fundamental
rights are to be clear, then they must be binding not only upon the Central
Government they must not only be binding upon the Provincial Government,
they must not only be binding upon the Governments established in the Indian
States, they must also be binding upon District Local Boards, Municipalities,
even village Panchayats and taluk boards, in fact every authority which has
been created by law and which has got certain power to make laws, to make
rules, or make bye-laws.

If that proposition is accepted – and I do not see anyone who cares for
Fundamental Rights can object to such a universal obligation being imposed
upon every authority created by laws then, what are we to do to make our
intention clear? There are two ways of doing it one way is to use a composite
phrase such as ‘the State’, it’s we have done in Article 7; or, to keep on
repeating every time, the Central Government the Provincial Government the
State Government the Municipality, the Local Board, the Port Trust or any other
authority’. It seems to me not only most cumbersome but stupid to keep on
 [4]

repeating this phraseology every time we have to make a reference to some

authority. The wisest course is to have this comprehensive phrase and to
economies in words.”
From the above, it is seen that the intention of the Constitution framers in
incorporating this Article was to treat such authority which has been created by
law and which has got certain powers to make laws to make rules and
regulations to be included in the term “other authority” as found presently in
Article 12. This definition has given birth to series of judgments and cases
primarily due to inclusion of words “authority” in the last part of the definition.
Attempts have been made to determine the scope this word initially the
definition of State was treated as exhaustive and confined to the authorities or
those which could be read with the authorities mentioned in the definition of
Article 12 itself.
The next stage was reached when the definition of ‘State’ came to be
understood with reference to the remedies available against it. For example,
historically, a writ of mandamus was available for enforcement of statutory
duties or duties of a public nature. Thus a statutory corporation, with regulations
farmed by such Corporation pursuant to statutory powers was considered a
State, and the public duty was limited to those which were created by statute.
The decision of the Constitution Bench of this Court in Rajasthan
Electricity Board v. Mohan Lal and Ors, is illustrative of this. The question
there was whether the Electricity Board – which was a corporation constituted
under a statute primarily for the purpose of carrying on commercial activities
could come within the definition of ‘State’ in article 12.
 [5]

Definition of State U/A 12

Article 12 defines State by consisting of the following parts of the Constitution-

• The Government and the Parliament of India

• The Government and the Legislature of each State.
• Local Authorities and Other Authorities.
And the essential bodies embodied under Article 12-
• The President of India and Governors of states with executive powers
• Any department of the government like the Income Tax Department.
• Any institution controlled by the government like the International Institute for
Population Sciences
• LIC and ONGC which perform tasks similar to governmental or sovereign
functions.
• Municipalities, Panchayats, and other similar local authorities with the power
to
make and enforce rules, regulations, and laws.
• Any other organization which exercises sovereign functions.

Article 12 does not clear about the definition of

Jurisdiction. However, the school of thought is that
since the judiciary has the power to make and
enforce laws, it should be considered to be a State.
However, whereas a false judgment may cause a
violation of the fundamental rights of a citizen,
obstructive decisions of the Courts are subjected to the
tests of Article 14 of the Constitution. Thus, the
simple regulatory power of the government over any
statutory or non-statutory body is not enough for it to
be deemed as a State. The concerned administrative body
 [6]

has to be financially, functionally and administratively and pervasively

controlled by the government.

Government (Union and state), Parliament and State Legislature

The term ‘State’ thus includes executives as well as the legislative organs of the
Union and States. It is, therefore, the actions of these bodies that can be
challenged before the courts as violating fundamental rights.

 Parliament: The parliament comprises of the President of India, the

lower house of the parliament that is the Lok Sabha as well as the
upper house of the Parliament, that is the Rajya Sabha.
 Executive: It is that organ which implements the laws passed by the
legislature and the policies of the government. The rise of the welfare
state has tremendously increased the functions of the state, and in
reality, of the executive. In common usage, people tend to identify the
executive with the government. In contemporary times, there has taken
place. A big increase in the power and role of the executive in every
state. The executive includes the President, Governor, Cabinet
Ministers, Police, bureaucrats, etc.

 Legislature: The legislature is that organ of the government which

enacts the laws of the government. It is the agency which has the
responsibility to formulate the will of the state and vest it with legal
authority and force. In simple words, the legislature is that organ of the
government which formulates laws. Legislature enjoys a very special
and important in every democratic state. It is the assembly of the
elected representatives of the people and represents national public
opinion and power of the people.

 Government: The law-making or legislative branch and

administrative or executive branch and law enforcement or judicial
branch and organizations of society. Lok Sabha (the lower house) and
Rajya Sabha (the upper house) form the legislative branch. Indian
President is the head of the state and exercises his or her power
directly or through officers subordinate to him. The Supreme Court,
High Courts, and many civil, criminal and family courts at the district
level form the Judiciary.
 [7]

 State Legislature: The legislative body at the state level is the State

Legislature. It comprises of the state legislative assembly and the state
legislative council.

Local Authorities
Before understanding what, a local authority is, it is important to define
Authorities. According to Webster’s Dictionary; “Authority” means a person or
body exercising power to command. When read under Article 12, the word
authority means the power to make laws (or orders, regulations, bye-laws,
notification etc.) which have the force of law. It also includes the power to
enforce those laws

“Local Authority shall mean a municipal committee, district board, body of

commissioner or other authority legally entitled to or entrusted by the
Government within the control or management of a municipal or local fund.”

The term Local authority includes the following:

1. Local government: According to Entry 5 of the List II of VII Schedule

‘local government’ includes a municipal corporation, improvement
trust, district boards, mining settlement authorities and other local
authorities for the purpose of local self-government or village
administration.
2. Village Panchayat: In the case of Ajit Singh v. State of Punjab, it was
held that within the meaning of the term local authority, village
panchayat is also included.

In Mohammad Yasin v. Town Area Committee, the Supreme Court held that to
be characterized as a ‘local authority’ the authority concerned must;

1. Have a separate legal existence as a corporate body

2. Not be a mere government agency but must be legally an independent
entity
3. Function in a defined area
4. Be wholly or partly, directly or indirectly, elected by the inhabitants of
the area
 [8]

5. Enjoy a certain degree of autonomy (complete or partial)

6. Be entrusted by statute with such governmental functions and duties as
are usually entrusted to locally (like health, education, water, town
planning, markets, transportation, etc.)

Other Authorities
The term ‘other authorities’ in Article 12 has nowhere been defined. Neither in
the Constitution nor in the general clauses Act, 1897 nor in any other statute of
India. Therefore, its interpretation has caused a good deal of difficulty, and
judicial opinion has undergone changes over time.

The functions of a government can be performed either the governmental

departments and officials or through autonomous bodies which exist outside the
departmental structure. Such autonomous bodies may include companies,
corporations etc.

So, for the purpose of determining what ‘other authorities’ fall under the scope
of State, the judiciary has given several judgements as per the facts and
circumstances of different cases.

Cases related to State and article 12 of Indian Constitution.

In University of Madras Vs Shanta Bai & Anr, AIR 1954 Mad. 67
The Madras High Court evolved the principle of ejusdem generis which meant
only authorities that perform Governmental or sovereign functions can be
included under Article 12 of Constitution of India. The Supreme Court of India
interpreted the definition of State in a very restricted sense. The Supreme Court
treated the definition as exhaustive one, and confined to the authorities or those
which are of like nature.
In Rajasthan Electricity Board Vs Mohan Lal & Ors, AIR 1967 SC 1857
The Supreme Court held that other authorities included those authorities which
had been created by the Constitution or under any statute and, on whom powers
had been conferred upon by law. And it is immaterial that some of the powers
conferred on the authority may be for the purpose of carrying on commercial
activities while deciding the status of the authority under Article 12 of the
Constitution.
In Sukdev Singh & Ors. Vs Bhagat Ram & Anr., AIR 1975 SC 1331
 [9]

The Supreme Court discussed the status of statutory corporations like ONGC,
IFC and LIC. The Supreme Court held that all of these Corporations were the
State under Article 12 of the Constitution of India because these corporations
were created by statutes, had the statutory power to make binding rules and
regulations, and were subject to pervasive Government control

In R. D. Shetty Vs International Airport Authority & Ors., 1979 SCR (3)

1014
The Supreme Court laid down five tests to be considered other authority, which
are as follows:
 Entire share capital is owned or managed by State
 Enjoys monopoly status.
 Department of Government is transferred to Corporation.
 Functional character governmental in essence.
 Deep and pervasive State control.
 Object of Authority.

In Ajay Hasia Vs Khalid Mujib & Ors., AIR 1981 SC 487 a Regional
Engineering College was under the Governments financial & administrative
control. The Supreme Court held that the College was an authority for the
purposes of Article 12 of Constitution of India.

The Supreme Court laid down the following tests to determine whether a body
is an instrumentality of the Government or not:

 If the entire share capital of the Corporation is held by the Government

 Where the financial assistance of the State is so much as to meet almost
entire expenditure of the Corporation.
 Whether the Corporation enjoys monopoly status, which is State
conferred or State protected?
 Existence of deep and pervasive State control
 If the functions of the Corporation are of public importance?
 If a department of Government is transferred to Corporation?
 [10]

Issues in News Related with Article 12 of the Indian Constitution

 The debate whether BCCI should be included under the ambit of Article
12 of the Indian Constitution and shall be termed as the ‘State.’
In its 275th report, the Law Commission of India (Advisory Body to the
Ministry of Law and Justice) has asked the Government to treat BCCI as
an agency of the state under Article 12.
 In a recent petition to the Supreme Court demanding an introduction of a
uniform financial assistance policy for the lawyers in the emergencies,
names of agencies like the Bar Council of India and the State Bar
Councils came to surface. Aspirants should know that these agencies are
the creation of the statute and fall under the categories of “other
authorities” within the meaning of Article 12 of the Indian Constitution.
 Sanjaya Bahel v. Union of India & Others case – The case dealt with the
issue of the immunity enjoyed by United Nations Organizations (UNO)
under the United Nations (Privileges and Immunities) Act, 1947. Delhi
High Court, in May 2019, declared that UNO is not a ‘State’ defined
under Article 12 of the Indian Constitution.

https://lexpeeps.in/definition-of-state-under-article-12/
https://blog.ipleaders.in/state-article-12-constitution-india/
http://www.legalservicesindia.com/article/1914/State-Under-Indian-
Constitution.html
https://legalserviceindia.com/legal/article-5777-concept-of-state-for-the-
purposes-of-article-12-of-constitution-of-india.html
https://lawtimesjournal.in/concept-of-state-under-article-12-of-the-indian-
constitution/
https://theindianconstitution.com/article-12-state-definition/
https://www.drishtiias.com/daily-updates/daily-news-analysis/state-under-
article-12-of-the-constitution
 [11]

Introduction
The term federalism means the division of powers between the centre and
state. It is a very complex mechanism though it is the very purpose for which a
federal state is formed includes the distribution of powers between the union
and the centre. Their power is partitioned by the constitution so that they should
their independence over the executive and legislative authority. As our
constitution is of federal structure it establishes dual polity between the union
and state. They are conferred with the sovereign powers which are to be used in
a manner directed by the Constitution. Our constitution is of is the supreme
law of the land provides the basic meaning of federalism that is the division of
powers.
 [12]

Under article 245 of the Indian constitution, it has been stated that:

 Parliament has jurisdiction to make laws for extraterritorial operations or

laws for the whole or any part of the country.
 The state legislature has the jurisdiction to make laws for the whole or
any part of the state.
Thus, it can be said that both the union and the state have their own
territorial jurisdiction to make laws.

Under article 246 it has been stated,

 Parliament has the explicit power to make laws for the subject matters
enumerated in the union list (list I of the 7th schedule)
 The state has the power to make laws for the subject matter enumerated
in the state list (list II of the 7th schedule)
 Both the state and the union have the power to make laws for the subject
matter enumerated in the concurrent list (list III of the 7th schedule)
Under article 245(2) of the Indian constitution, if any law is made by the
parliament regarding the extraterritorial operations, no questions can be raised
on its validity. Thus, the validity of a legislation can’t be questioned. In this
case, a court is bound to enforce the laws made with regards to extra-territorial
operations. This legislation can’t be invalidated.

Legislative relation between the centre and state

The legislative powers are distributed in two ways which are provisioned by the
constitution.
 Distribution of legislative powers in respect of the territory
 With respect to the subject matters of the list under 7th schedule
 [13]

Distribution of the legislative powers with respect to the territory

As enshrined under article 245(1) of the Indian constitution parliament
can make laws for the whole or any part of the territory of India. Parliament also
has extra-territorial jurisdiction for which it can make laws and these laws can’t
be invalidated on the grounds that they have no effect outside India.
In the case of A.H. Wadia v. Income Tax Commissioner, it was held that
a question of extraterritoriality of enactment can never be raised against a
supreme legislative authority on the grounds of questioning its validity. It may
not comply with the rules of international law or while enforcing it practical
difficulties may arise but they are subjected to questions of policy which is the
concern of the national or domestic tribunal.

Theory of territorial nexus

In order to give effect to the laws made by a state for extraterritorial purpose, a
nexus between the object and state must be shown. The state legislature has the
jurisdiction to make laws within its territorial jurisdiction. Territorial nexus is
one such exception which allows the state to make laws for extraterritorial
operations if it shows that there exists a nexus between the object and the state.

Wallace Bros. And Co. Ltd. vs The Commissioner Of Income

In the instant case, a company which was registered and incorporated in also
which also carried out its business in India through a sleeping partner. The firm
made a staggering profit in that accounting year. The income tax authorities
sought to levy a tax upon the company of the respondent. The income tax
authority was challenged by the respondent, but it was held by the privy council
that there existed the doctrine of territorial nexus and held the tax valid. It is
said that the major part of that income was extracted from British India was the
sufficient ground to establish a territorial nexus.

Territorial Nexus and the State Legislature

Our Constitution confers the power upon the state to make laws within its
territorial jurisdiction
 [14]

Now a question on whether a law falls under the ambit of the state legislature
enacting it.
The state legislature is empowered to make laws for its own purpose. The
doctrine of territorial nexus is only applicable when the following conditions are
fulfilled. Those conditions are as follows;
1. The nexus must be legitimate.
2. The liability shall be related to the territorial connection.
These conditions are sufficient enough to show that the nexus was legitimate
and the court would not question its validity. In several cases of the taxation law
it has been held that the territorial limits of a state would not hamper the sale
and purchase of the goods. Buying and selling of goods would be a reasonable
ground to sustain the taxing power of the state.

Centre-State Relations
“The basic principle of federations is that the legislative and executive authority
is partitioned between the centre and the states not by any law to be made by the
centre, but by the constitution itself.... The states are in no way dependent upon
the centre for their legislature or executive authority. The states and the centre
are coequal in this matter”. - Dr. B.R. Ambedkar
The above statement makes it quite clear that the Indian Constitution introduces
a federal system as the basic structure of government of the country. The union
and the states derive their authority from the constitution which divided all
powers - legislative, executive and financial as between them.
The result is that the states are not delegates of the union, but they are
autonomous within their own spheres as allotted by the constitution. “The union
and the states are also equally subjected to the limitations imposed by the
constitution”, for instance, the exercise of legislative powers being limited by
fundamental rights, if any of these constitutional limitations are violated, the
law of the legislature concerned is liable to be declared invalid by the courts.
As mentioned above, neither the Union Legislature nor a State Legislature can
be said to be sovereign in the legalistic sense each being limited by the
provisions of the constitution, the scheme of the distribution of powers and
fundamental rights.
 [15]

Legislative Relations Chapter I of Part XI (Article 245-254) of the Indian

Constitution specified two-fold division of Legislative powers between the
Union and the States.
1. with respect of territory
2. with respect of subject matter

Territorial Jurisdiction
As regards territory, Article 245 (1) provides that subject to the
provisions of this constitution, a State Legislature may make laws for the whole
or any part of the state to which it belongs. It is not possible for a State
Legislature to enlarge its territorial jurisdiction under any circumstances except
when the boundaries of the state itself are widened by an act of Parliament.
Parliament has, on the other hand, the power to legislate for ‘the whole or
any part of the territory of India, which includes not only the states but also the
union territory of India [Art. 246 (1). It also possess the power of ‘extra-
territorial legislation [Art. 245 (2), which no state legislature possesses. This
means that laws made by parliament will govern not only persons and property
within the territory of India but also Indian subjects resident and this property
situated anywhere in the world.
Limitations to the territorial jurisdiction of Parliament
The plenary territorial jurisdiction of Parliament is, however, subject to some
special provisions of the constitution. They are,
a) As regards some of the Union Territories, such as the Andaman and
Lakshadweep group of Islands, regulations may be made by the President to
have the same force as Acts of Parliament and such regulations may repeal or
amend a law made by Parliament in relation to such territory (Art. 240).
b) The application of Acts of Parliament to any scheduled area may be barred or
modified by notifications made by the Governor (Para 5 of the V Schedule (3)
of the Indian Constitution).
c) Para 12 (1) (6) of the VI Schedule says that the Governor of Assam may, by
public notification, direct that any other act of Parliament shall not apply to an
autonomous district or an autonomous region in the state of Assam or shall
apply to such district or region or part thereof subject to such exceptions or
modifications as he may specify in the notification.
 [16]

Distribution of Legislative Powers (subject matter)

As has been pointed out at outset, a federal system postulates a distribution of
powers between the centre and the states. The nature of distribution varies
according to the local and political background in each country. In America, the
sovereign states did not like complete subordination to the central government.
Hence, they believed in entrusting subjects of common interest to the central
government, while retaining the rest with them. Australia followed the
American pattern of only one enumeration of powers. In Canada, there is double
enumeration, federal and provincial leaving the residue for the centre. The
Canadians were conscious of the unfortunate happenings in the United States of
America, culminating Civil War of 1891. They were aware of the shortcomings
of the weak centre. Hence they opted a strong centre. Indian Constitution-
Makers followed the Canadian scheme obviously opting for a strong centre.
However, they added one more list - concurrent list.
As regards the subjects of legislation, the constitution adopts from the
Government of India Act, 1935 and divides the powers between the Union and
the States under three lists. They are as follows:
i. The Union list (ii)
ii. The State List and (iii)
iii. The Concurrent List.
 [17]

The Union List

At present the Union List consists of 99 Subjects over which the Union shall
have exclusive power of legislation. The Subjects mentioned in the Union List
are of national importance, for example, defence and foreign affairs etc.
The State List
The State List comprises of 61 Subjects over which the states have exclusive
power to make laws. The Subjects mentioned in the State List are of local or
regional importance, such as public order, police and public health etc.
Concurrent List
The Concurrent List includes 52 subjects and both the union and the states can
make laws on this list but in case of conflict between the Central Law and the
State Law, the Central Law will prevail over the State law. The purpose of
adding the List to the constitution was to secure uniformity in the main
principles of law throughout the country.
 [18]

Residuary Powers
It is quite interesting to note that the residuary powers are vested in the union,
while in the United States of America and Australia, these powers are given to
the states. Article 248 says that, Parliament has exclusive power to make any
law with respect to any matter not enumerated in any one of the three lists. This
reflects the leanings of the Constitution-makers towards a strong centre.
Another notable thing regarding to residuary powers is that “the final
determination as to whether a particular matter falls under the residuary power
or not is that of the courts.

What do you mean by Extra-Territorial Operations?

Parliament is conferred with the power to make laws within its territorial
jurisdiction and also for extra-territorial purpose that has a legitimate nexus with
India. Legislation or laws regarding this matter come under the ambit of the
parliament as it has the power to do so. These laws can’t be questioned on its
validity. If the parliament enacts any law which doesn’t establish any nexus
with India will turn out to be ultra vires and would be considered as the laws
made for a foreign land. This can be concluded that if any law passed by the
parliament has a real connection with India can’t be deemed to held as invalid
or unconstitutional. If such laws enacted by parliament establishes no nexus
with India would be ultra vires.
Our constitution states that the legislative powers conferred upon the parliament
in order to enact laws within the territorial jurisdiction as well as for the
purpose may take the cognizance of the extraterritorial purpose and exercise the
state powers or the collective powers Doctrine of public trust states that all the
laws enacted by parliament with respect to extraterritorial operations shall be
enacted for the purpose of safeguarding the welfare and security of India, which
directly concludes that no laws shall be made for the extraterritorial operations
if there is no nexus of such law or legislation with India.
 [19]

The role of territorial jurisdiction in Indian Legislation

As it has been stated before in this article that Article 245 of the Indian
constitution states the extent to which the legislative powers are conferred in
parliament and the state legislature in order to make laws with respect to the
territory. Parliament has the power to make laws for the for which it has the
jurisdiction. The jurisdiction of parliament extends to the whole or any part of
India. They can also be enacted by the parliament for extraterritorial operations
if there is sufficient nexus of the law with India. These laws cannot be
questioned or held invalidated. However, all the laws must comply with the
provisions of the Indian constitution.
The powers conferred in parliament are not absolute. Laws made by the
parliament for Extraterritorial operations are for the purpose of operating
outside the geographical limits of India. The state legislature doesn’t have the
power to make laws for extraterritorial operations. However, this limitation of
the state legislature is subjected to one exception and that is territorial nexus. If
it is established that there is sufficient connection with the object and the laws
enacted by the state legislature will have an effect outside the territorial limits of
the state.

The following circumstances are required in order to invoke the jurisdiction of

territorial nexus-

 If there exist extraterritorial operations in a state

 If there is legitimate nexus between the object and the state.
It should be clear that the object shall be situated outside the
territorial limits of the state but it must have a territorial
connection with the state.
 [20]

State of Bombay vs R.M.D. Chamarbaugwala

In the instant case, the respondent who was not a resident of Bombay
conducted a prize competition of a crossword puzzle through a newspaper
which was printed and published in the Bangalore. This paper was widely
published in Bombay to. For this competition depots were established so that
the forms and fees can be collected. It attracted a lot of buyers for the ticket of
that competition.
The state government then levy take over the respondent’s company for
contesting a prize competition in the state. The respondent challenged the
supreme court and a question was raised whether the tax can be levied upon a
person who resides outside the territorial limits of the state. It was held by the
supreme court that there was a sufficient territorial nexus and the legislature
has the authority to tax the respondent for the revenue earned by his company
through the prize competition.
Tata Iron and Steel Company vs. Bihar State Tax Act
The state of Bihar passed sales tax act for levying a tax in on the sales
whether it took place within the territorial limits of the state or outside of that
limit, it was also stated that the goods should be manufactured in the state. In
the instant case, it was held that there was an established nexus between the
object which was to be taxed and the law. These are the two essential elements
that constitute the doctrine of territorial nexus.
State of Bihar v. Charusila Dasi
In the instant case, the state of Bihar passed a legislation which dealt with
the motive to safeguard the properties relating to the Hindu religious trusts. This
act consists of all the trusts within the territorial limits of Bihar. So the
respondent Madea trust deed several of her properties in situated in Bihar and
Calcutta, and the trust was inside the territorial limits of Bihar. Several
questions were raised about the scope of this act. It was held that the act passed
by the state of Bihar could have the effect over the property situated outside the
territorial limits of Bihar keeping in mind that the trust must be situated with the
limits of the state and there exist the sufficient nexus.
 [21]

Shrikant Bhalchandra Karulkar v. State of Gujarat

The hon’ble supreme court in this instant case of Shrikant Bhalchandra
Karulkar v. State of Gujarat held that the state legislature is conferred with the
power to enact legislation for extra-territorial operations complying with the
provisions enshrined under article 245 and 246.The laws made by the state
legislature is applicable to a person and his acts within the territorial limits of a
state is not considered as extra territorial.

Conclusion
It can be concluded that the legislative powers has been distributed in two
folds between the centre and state. Federalism is a very complex mechanism
though it is the very purpose for which a federal state is formed includes the
distribution of powers between the union and the centre. Their power is
partitioned by the constitution so that they should their independence over the
executive and legislative authority.
As our constitution is of federal structure it establishes dual polity
between the union and state. Parliament has the power to make laws for any or
whole part of India as well is conferred with the power to make laws for extra
territorial operations.however, a state legislature is not competent enough to
make laws for the extraterritorial operations. However there is one exception
which enables the state legislature to make laws for the extra territorial purposes
if there exists a sufficient connection between the object and the state. It means
that the object shall be located outside the territorial limits of the state and has a
territorial connection with the state. The scope of territorial nexus is wide and
can be applied outside the territorial limits of India. The doctrine of territorial
nexus allows the effect of law out the territorial limits of a nation.
https://main.sci.gov.in/jurisdiction
https://lexforti.com/legal-news/a-critique-on-the-territorial-jurisdiction-
of-courts-in-india/
http://www.bsklegal.org/blogs/territorial-nexus/
https://blog.ipleaders.in/doctrine-of-territorial-nexus/
https://blog.ipleaders.in/doctrine-of-territorial-nexus/
[22]