The Preamble

The Constitution of India sets out in its introductory statement called the Preamble, the aims and aspirations of the people of India. The objectives given by the people unto themselves in 1949 were to establish a Sovereign Democratic Republic and to secure to its citizens, justice, liberty, equality and fraternity. The Supreme Court of India in one of its landmark judgments has affirmed that the Preamble is also a part of the Constitution in the affirmative.

Fundamental Rights

The Constitution assures every citizen, and in some cases all persons, certain basic rights that cannot ordinarily be abrogated by the State. To make these rights effective, the Constitution provides 'Writ' remedies whereby the superior courts (i.e., the Supreme Court and the High Courts) are vested with the power to enforce these rights by issuing mandatory directions to the authorities. No law made by the State Legislatures or Parliament can effect these fundamental rights.

The Constitution confers upon all citizens the right to certain fundamental freedoms. They are:

1. Freedom of speech and expression
2. Peaceful assembly without arms
3. Formations of associations and unions
4. Free movement throughout the territory of India
5. Residence and settlement in any part of the territory of India
6. Practice of any profession or carrying on of any occupation, trade or business

The rights conferred by the Constitution are confined to natural persons who are citizens and that a corporation not being a citizen cannot claim any of these rights.

Directive Principles of State Policy

These are statements of certain ideals that the Indian Nation State must strive for. Unlike the fundamental rights, these provisions are not enforceable by Courts. Nevertheless, these principles are fundamental for the governance of the country. Some of the directive principles are:

1. The state shall strive for the promotion of the welfare of the people
2. Economic principles aimed at an egalitarian economic order
3. Organisation of village administration
4. Protection of environment.
5. Education.

The Constitution deals with the form of government that India must have. The government comprises three heads, the Executive, the Legislature and the Judiciary. Being a Federal Constitution, the Indian model has two spheres of authority, the Union or Central Government and the State Governments. However, no dual citizenship is permitted. Taxing power is circumscribed by the Constitution with the condition that to levy a tax there must be a specific law made under a legislative head. The provisions also exempt the State and Central Governments from mutual taxation besides making appropriate provisions for allocation of revenues between the Union and the State. The Constitution proclaims that trade and commerce shall take place unhindered throughout the length and breadth of the country.

Centre-State Relations

The Constitution of India, unlike many other Constitutions is both a political and a financial document. Constitution deals in detail in issues like the finances of the Union and State. The Constitution also provides an elaborate framework through which legislation is possible for laws to regulate various types of business. The public law in India clearly contemplates and in many cases sets out in elaborate terms the legal strategy in relation to various aspects of finance, trade, commerce and business. It is important to study the division of powers between the Centre and State to understand the true nature of business laws.

Trade and Commerce throughout India

Freedom of Trade and Commerce

The economic unity of India is not broken up by internal barriers. In doing so, the Article imposes a limit on the exercise of legislative power of the Union/State. If freedom of trade and commerce is restricted directly and immediately by taxes, it would then be violation of the Constitution. The validity of the claim of such an offence will depend on the movement of goods. If the tax which is imposed solely on the basis that the goods are transported or carried, it would directly affect the freedom of trade, commerce and intercourse. Trade, commerce and intercourse must pay for the facilities provided by the State by way of constructing, maintaining and regulating roads, bridges and other means of transportation necessary for such trade, commerce on intercourse. As long as there is correlation between the tax recovered and the cost incurred by the State, the tax cannot be challenged as expropriatory though there may be a marginal excess over the cost.

Parliamentary Restrictions

A law restricting freedom of trade and commerce can be made only by Parliament strictly in public interest. However such law made by the Union should not be discriminatory between different states unless the situation warrants. The Parliament or any of the State Legislatures does not have the right to give preference to one state over another in respect of trade and commerce.

Freedom of State

State Legislatures have powers,

1. to impose taxes on goods from other states provided similar goods produced within the state are also subjected to the same taxes.
2. to impose reasonable restrictions on the freedom of trade, commerce or intercourse with another or within that state as may be required in public interest.