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Microlesson · 5-min read

Power to Levy Taxes (Constitutional Authority)

## Power to Levy Taxes

Taxes in India can be levied only through the authority of the Constitution — not at the discretion of any officer or department.

### Article 265 — No Tax Without Law

> No tax can be levied or collected except by authority of law.

This is the foundational safeguard: every tax must be backed by a validly enacted law.

### Article 246 + Seventh Schedule — Who Can Make Tax Laws

Article 246 read with the Seventh Schedule divides legislative powers into three lists:

ListWho can legislate
Union ListOnly Parliament
State ListOnly State Legislatures
Concurrent ListBoth Parliament and State Legislatures

### Source of the Income Tax Power

Entry 82 of the Union List (in the Seventh Schedule, under Article 246) empowers Parliament to make laws on:

> Taxes on income other than agricultural income.

This is exactly why:

  • Income tax is a Central (Union) levy made by Parliament.
  • Agricultural income is outside Entry 82 → it is exempt from central income tax (it falls to the States).

Worked example

### Example 1

Q: Under which constitutional entry does Parliament derive power to tax income, and what income is excluded?

A: Entry 82 of the Union List empowers Parliament to tax income other than agricultural income. Agricultural income is therefore excluded from the central charge.

### Example 2

Q: A government department demands a new tax that has not been enacted by any legislature. Is it valid?

A: No. Under Article 265, no tax can be levied or collected except by authority of law. Without an enabling statute, the demand is unconstitutional.

⚠️ Common exam mistakes

  • Confusing Article 265 (no tax without law) with Article 246 (distribution of legislative powers).
  • Forgetting that income tax power flows from Entry 82 of the Union List specifically.
  • Thinking agricultural income is taxed centrally — it is excluded from Entry 82 and falls under State jurisdiction.
Bare-Act text Article 265 · Constitution of India · click to expand
No tax shall be levied or collected except by authority of law.
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