Delhi High Court – Orders
Vinod J Sharma vs Union Of India & Ors on 16 February, 2026
$~72
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 2129/2026 & CM APPL. 10354/2026
VINOD J SHARMA .....Petitioner
Through: Mr. Bharat Bhushan, Ms. Nidhi
Gupta and Mr. Anunay Mishra,
Advocates.
versus
UNION OF INDIA & ORS. .....Respondents
Through: Mr. Anurag Ojha, SSC with Mr.
Dipak Raj, Advocates
CORAM:
HON'BLE MR. JUSTICE NITIN WASUDEO SAMBRE
HON'BLE MR. JUSTICE AJAY DIGPAUL
ORDER
% 16.02.2026
CM APPL. 10355/2026 (Exemption)
1. Exemption allowed, subject to all just exceptions.
2. The application stands disposed of.
W.P.(C) 2129/2026 & CM APPL. 10354/2026
3. The prayer in the petition reads thus:-
“a. Issue a writ of certiorari or any other appropriate/
order / direction to declare The Health Security Se
National Security Cess Act 2025 (Act No. 35 of 2025 as
unsustainable being passed beyond the legislative
competence of Parliament as well as being violative of
Article 14 and 19(1)(g) of the Constitution.
b. Issue an appropriate writ / order / direction to declare
that the Petitioner is not required to get itself registeredThis is a digitally signed order.
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and pay Cess levied under the Health Security Se
National Security Cess Act 2025 (Act No. 35 of 2025 and
the rules made thereunder;
c. Issue an appropriate writ / order / direction to the
respondents restraining from taking coercive action
against the petitioner for not getting itself registered and
not paying the cess as levied under the Health Security
Se National Security Cess Act 2025 (Act No. 35 of 2025)
and the rules made thereunder;
d. To Grant ad-interim relief with respect to prayer
under Para (a), (b), and (c) above.
e. To issue order(s), direction(s), writ(s) or any other
relief(s) as this Hon’ble Court deems fit and proper in
the facts and circumstances of the case and in the
interest of justice;
f. To issue Rule Nisi in terms of prayers (a) to (c) above;
To award Costs of and incidental to this application be
paid by the Respondents;”
4. The validity of the Statute is questioned on the ground of legislative
competence, so also the Schedule, particularly Schedule II, framed under
Sections 2(o), 4(1), 5 and 6 of the Health Security Se National Security cess
Act 2025, to be arbitrary.
5. According to learned counsel for the petitioner, the case of legislative
incompetence qua the aforesaid Statute can be inferred from a plain reading
of Article 270, which forms in Chapter I, Part XII of the Constitution of
India, which deals with finance. According to him, Article 270 which
provides for taxes levied and distributed between the Union and the States,
does not in itself provide for the power to levy the Cess, as has been done
under the Statute under challenge.
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6. Learned counsel for the petitioner has read Sub-Article (1) of Article
270 to substantiate his contentions. Article 270 of the Constitution of India
reads thus:-
“[270. Taxes levied and distributed between the Union
and the States.–(1) All taxes and duties referred to in
the Union List, except the duties and taxes referred to in
articles [268, 269 and 269A], respectively, surcharge on
taxes and duties referred to in article 271 and any cess
levied for specific purposes under any law made by
Parliament shall be levied and collected by the
Government of India and shall be distributed between
the Union and the States in the manner provided in
clause (2).
[(1A) The tax collected by the Union under clause (1) of
article 246A shall also be distributed between the Union
and the States in the manner provided in clause (2).
(1B) The tax levied and collected by the Union under
clause (2) of article 246A and article 269A, which has
been used for payment of the tax levied by the Union
under clause (1) of article 246A, and the amount
apportioned to the Union under clause (1) of article
269A, shall also be distributed between the Union and
the States in the manner provided in clause (2).]
(2) Such percentage, as may be prescribed, of the net
proceeds of any such tax or duty in any financial year
shall not form part of the Consolidated Fund of India,
but shall be assigned to the States within which that tax
or duty is leviable in that year, and shall be distributed
among those States in such manner and from such time
as may be prescribed in the manner provided in clause
(3).
(3) In this article, “prescribed” means,–
(i) until a Finance Commission has been constituted,
prescribed by the President by order, and
(ii) after a Finance Commission has been constituted,
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prescribed by the President by order after considering
the recommendations of the Finance Commission.]”
7. He would further claim that the said provision if considered in light of
the provisions of Chapter XI which deals with relation between the Union
and the States, Chapter 1 thereunder speaks of legislative relationship. He
would further claim that by virtue of 101st Constitutional Amendment,
Article 246A was introduced, wherein a special provision with respect to
Goods & Services Tax is made. According to him, the said provision fell for
interpretation before the Apex Court in the matter of Union of India Vs.
Mohit Mineral Pvt. Ltd [2018 (17) G.S.T.L. 561 (S.C)]. He would, as such,
claim that the provisions of Part XII Chapter 1 cannot be read to the extent
of inferring that there vests power in the Parliament to frame the Statute in
relation to levy of Cess for the subject of Pan Masala, for which already the
provision is made under the law viz. under Article 246A.
8. In addition, his contentions are the issue is further canvassed before
the Apex Court in the matter of State of Telangana Vs. Tirumala
Constructions, reported in 2023 11 Centex 259 (S.C). Since the power
cannot be drawn from Article 270(1) as the same falls in Part XII and not in
Part XI, wherein the power to levy is provided under Article 246A, there is a
lack of legislative competence.
9. In addition to above, his contentions are the Cess is identified under
the Mohit Minerals case (referred supra) to be a tax. In case of levy of tax,
as in interpreted in Mohit Minerals case (referred supra), there is no
corresponding obligation on the States or Union of India to provide the
services as against the Cess which is levied in the form of ‘Fee’. The
moment Cess takes colour of ‘Fee’, there is a corresponding obligation ofThis is a digitally signed order.
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providing service or facility to such institution or person to whom such Cess
is levied. In these background, the contentions are that the Statute framed
lacks legislative competence.
10. The further contention of learned counsel for the petitioner are that
the Schedule is arbitrary for the reason the Cess levy is made based on the
weight of the pouch. According to him, the approach of the respondent
pursuant to the levy as provided in Schedule II of the Act is arbitrary in
nature for the reason that the duty is varied from less than 1% to more than
40% at places, depending on the price of the pouch. As such, he would claim
that there has to be uniformity in the matter of levy of Cess and that being
so, the very Schedule framed by the Parliament in the matter of levy of Cess
is completely arbitrary as there is no intelligible differentia qua the rate at
which the Cess is levied.
11. At this stage, learned counsel for the petitioner seeks time to place on
record the written submissions.
12. Let the same be placed on record within a period of one week from
today.
13. List on 26th February, 2026.
NITIN WASUDEO SAMBRE, J
AJAY DIGPAUL, J
FEBRUARY 16, 2026/ay/okThis is a digitally signed order.
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