Actual Article
Article 265: Taxes not to be imposed save by authority of law
No tax shall be levied or collected except by authority of law.
UPSC Notes for Article 265
Explanation:
- Authority of Law: Article 265 mandates that taxes can only be levied or collected by the authority of law. This means that any tax must be authorized by a valid law passed by the competent legislative authority.
- Protection Against Arbitrary Taxation: This provision ensures that no arbitrary or unauthorized taxes can be imposed on citizens, providing a safeguard against unjust taxation.
Key Points:
- Legal Basis for Taxation: All taxes must have a legal basis, ensuring transparency and accountability in the taxation process.
- Legislative Competence: The authority to impose taxes is vested in the legislature, which must pass laws specifying the nature, scope, and rate of taxes.
- Constitutional Safeguard: Article 265 serves as a constitutional safeguard against the imposition of taxes without proper legal authorization, protecting the financial rights of citizens.
Important Cases and Commissions Related to Article 265
Cases:
- Govind Saran Ganga Saran vs. Commissioner of Sales Tax (1985): The Supreme Court held that the imposition of taxes without the authority of law is unconstitutional, reinforcing the principle established by Article 265.
- CIT vs. B.C. Srinivasa Setty (1981): The Supreme Court emphasized that tax laws must be clear and precise, ensuring that taxation is conducted according to the law.
Commissions:
- Tax Reforms Committee (Chelliah Committee): Recommended various reforms to simplify the tax structure and ensure compliance with the constitutional provisions regarding taxation.
- Law Commission of India: Reviewed the legal framework for taxation and recommended measures to strengthen the authority of law in tax matters.
Important Reports Related to Article 265:
- Kelkar Committee Report: Suggested measures to enhance transparency and efficiency in tax administration, ensuring that all taxes are levied and collected according to the authority of law.
Previous Year Prelims Questions Related to Article 265
- (UPSC Prelims 2016) According to Article 265 of the Indian Constitution, how can taxes be levied and collected?
- A. By the executive order
- B. By the judiciary
- C. By the authority of law
- D. By the consent of the citizens Correct Answer: C. By the authority of law
- (UPSC Prelims 2018) What does Article 265 ensure in the context of taxation?
- A. Taxes can be imposed without any legal backing
- B. Taxes must be authorized by a valid law
- C. Taxes can be levied by any governmental authority
- D. Taxes can be imposed by executive orders Correct Answer: B. Taxes must be authorized by a valid law
Previous Year Mains Questions Related to Article 265
- Mains 2016: “Discuss the significance of Article 265 in ensuring transparency and accountability in the taxation process in India. How does it protect against arbitrary taxation?”
- Mains 2019: “Evaluate the constitutional safeguards provided by Article 265 against the imposition of unauthorized taxes. What are the implications of this provision for fiscal governance in India?”
Additional Insights:
- Fiscal Governance: Article 265 is crucial for ensuring sound fiscal governance by mandating that all taxes must have legal authorization, promoting transparency and accountability in the taxation system.
- Legal Certainty: The requirement for a legal basis for taxation ensures that citizens are aware of the tax liabilities and that the process of taxation is governed by clear and precise laws.
Understanding Article 265 is crucial for UPSC aspirants as it provides insights into the constitutional provisions that regulate the imposition and collection of taxes, emphasizing the importance of legal authorization and protecting citizens against arbitrary taxation. This knowledge is essential for both preliminary and main examinations, offering a comprehensive understanding of the fiscal governance framework within the Indian Constitution.