Article 265 of the Constitution

No tax without a law. That is Article 265 in five words. The State cannot take your money unless a valid law allows it. It is one short line. Yet it is the base of the whole tax system, and the first clause lawyers check in any dispute over a levy.

1Chapter 1: The One-Line Guarantee

Must Know

The text

• Article 265 reads: “No tax shall be levied or collected except by authority of law.”
• It sits in Part XII, the chapter on Finance, Property, Contracts and Suits.
• If no law backs a tax, the tax is illegal.
• The government must first pass a law. Only then can it tax you.

Two steps, both need law

• Levy means creating the charge.
• Collection means taking the money.
• Article 265 covers both.
• You cannot collect a tax that was never lawfully levied.
• A void levy cannot be saved at the collection stage.
• Every rupee collected under a void levy is unlawful.

What counts as “authority of law”

• First, the right legislature must make the law.
• A tax on a Union List subject needs a Union law.
• A State List tax needs a State law.
• If the wrong body taxes you, the tax is illegal.
• Second, the law itself must be constitutional.
• A law that breaks the Constitution cannot support a tax.
• Third, a government order or notice alone is not enough.
• Rules made under a valid Act can work, but the Act itself must authorise them.

2Chapter 2: What a Tax Law Must Contain

Good to Know

Govind Saran (1985)

• In Govind Saran Ganga Saran v. Commissioner of Sales Tax (1985), the Supreme Court listed the parts of a tax.
• There are four: the taxable event, the person liable, the rate, and the measure of value.
• If these are unclear, it is hard to say a levy exists in law.
• The rank of the collecting officer is not one of the four parts.

Links to Articles 266 and 267

• Article 266 creates the Consolidated Fund of India and of each State.
• Tax money collected under a valid law goes into this fund.
• Money can leave the fund only with Parliament’s approval, except for charged expenditure.
• Article 267 creates the Contingency Fund, for urgent and unforeseen spending.

Where Article 265 fits in the tax system

• The Seventh Schedule divides subjects between the Union, State and Concurrent lists.
• Article 265 makes sure a matching valid law exists.
• GST works through Articles 246A, 269A and 279A.
• Even so, each GST levy still needs a valid law behind it.
• Entry taxes, cesses and surcharges keep getting challenged in court.
• The usual question is simple: is there a valid law behind this levy?
• Read more: Article 246A: Special Provision for GST Law-Making Power and Article 269A: IGST Levy and Apportionment.

3Chapter 3: The Story Behind the Shield

Great to Know

From Magna Carta to the Constitution

• The idea is very old.
• Magna Carta (1215) limited the king’s power to tax without consent.
• In 1950, the framers turned the principle into a written rule.
• “No taxation without law” became a constitutional command, not just a slogan.
• It is why governments pass tax Acts instead of collecting on their own.

In practice today

• Every Union Budget is a list of proposed taxes.
• Each one must point to the law that authorises it.
• If the law is missing or void, the tax falls under Article 265.
• When a tax is challenged as illegal, Article 265 is the first clause in the petition.
• New cesses and levies are routinely challenged as lacking authority of law.
• Related: Article 285: Exemption of Union Property from State Taxation and Article 286: Restrictions on State Taxation of Interstate Trade.

4Chapter 4: Exam Traps

Great to Know

How it is asked

• Exams rarely test the clause alone.
• They fold it into questions on GST, cesses and State taxes.
• If an option says a tax can be collected without a law, it is wrong.
• If an option says a government order alone is enough, it is wrong.
• Taxes on agricultural income are a State subject, so the matching law must be a State law.

5Previous Year Questions

Exam angle: real questions on this topic.

Quick Q&A

• Article 265 says? No tax without authority of law.
• Which Part? Part XII.
• Magna Carta year? 1215.
• Govind Saran year? 1985.
• Article 267? Contingency Fund.