Swatanter Kumar, J. —Leave granted in SLP (C) No. 9734 of 2005.

2. IA Nos.4 and 5 of 2009 in Civil Appeal No.3703 of 2003 are allowed subject to just exceptions and limited to this reference.

3. Legalistic federalism was introduced as a technique of governance with the people of India adopting, enacting and giving unto themselves the Constitution of India on 26th November, 1949. The legislative competence of the Central and State Legislatures has been demarcated by the Constitution under Article 246, with the fields for exercise of legislative power enumerated in List I (Central List), List II (State List) and List III (Concurrent List) of Schedule VII to the Constitution of India. Power to enact laws, thus, is vested in the Parliament as well as in the State Legislative Assemblies within their respective spheres. This is the paramount source for enactment of law, i.e., direct exercise of legislative power by the respective constituents. On the issue of distribution of powers between the Centre and the State, a Constitution Bench of this Court in Federation of Hotel & Restaurant Association of India v. Union of India 1[(1989) 3 SCC 634], noticed that the constitutionality