General Principle of Judicial Review on Administrative Action in Indian Legal System

GENERAL PRINCIPLE OF JUDICIAL REVIEW ON ADMINISTRATIVE ACTION IN INDIAN LEGAL SYSTEM

The doctrine of judicial review has been originated and developed by the American Supreme Court, although there is no express provision in the American Constitution for the judicial review. In Marbury v. Madison,[1] the Supreme Court made it clear that it had the power of judicial review. Chief Justice George Marshall said,

“Certainly all those who have framed the written Constitution contemplate them as forming the fundamental and paramount law of the nations, and consequently, the theory of every such Government must be that an act of the legislature, repugnant to the Constitution is void”.

There is supremacy of Constitution in U.S.A. and, therefore, in case of conflict between the Constitution and the Acts passed by the legislature, the Courts follow the Constitution and declare the acts to be unconstitutional and, therefore, void. The Courts declare void the acts of the legislature and the executive, if they are found in violation of the provisions of the Constitution.

A. Meaning

Judicial review is a great weapon in the hands of judges. It comprises the power of a court to hold unconstitutional and unenforceable any law or order based upon such law or any other action by a public authority which is inconsistent or in conflict with the basic law of the land.

Kailash Rai defines judicial review as the authority of the Courts to declare void the acts of the legislature and executive, if they are found in the violation of the provisions of the Constitution. Judicial Review is the power of the highest Court of a jurisdiction to invalidate on Constitutional grounds, the acts of other Government agency within that jurisdicition.[2]

Broadly speaking, judicial review in India deals with three aspects: (i) judicial review of legislative action; (ii) judicial review of judicial decision;

http://4.bp.blogspot.com/_69afOHQ42c4/RvLIhHAzP-I/AAAAAAAAAQ4/sCX4XfM-ye4/s1600-h/Judicial+Review.jpg

and (iii) judicial review of administrative action.[3] In this short-paper, we are concerned with the last aspect, namely, judicial review of administrative action.

It is necessary to distinguish between ‘judicial review’ and ‘judicial control’. The term judicial review has a restrictive connotation as compared to the term judicial control. Judicial review is ‘supervisory’, rather than ‘corrective’, in nature. Judicial review is denoted by the writ system which functions in India under Arts. 32 and 226 of the Constitution. Judicial control, on the other hand, is a broader term. It denotes a much broader concept and includes judicial review within itself. Judicial control comprises of all methods through which a person can seek relief against the Administration through the medium of the courts, such as, appeal, writs, declaration, injunction, damages statutory remedies against the Administration.[4]

B. Object

The underlying object of judicial review is to ensure that the authority does not abuse its power and the individual receives just and fair treatment and not to ensure that the authority reaches a conclusion which is correct in the eye of law.

As observed by the Supreme Court in Minerva Mills Ltd. v. Union of India[5], the Constitution has created an independent judiciary which is vested with the power of judicial review to determine the legality of administrative action and the validity of legislation. It is the solemn duty of the judiciary under the Constitution to keep different organs of the State within the limits of the power conferred upon them by the Constitution by exercising power of judicial review as sentinel on the quo vive. Thus, judicial review aims to protect citizens from abuse or misuse of power by any branch of the state.

Judicial quest in administrative matters is to strike the just balance between the administrative discretion to decide matters as per government policy, and the need of fairness. Any unfair action must be set right by administrative review.[6]

C. Judicial Review, Appeal and Revision

It should be remembered that the object and scope of judicial review of administrative action is different from that of appeal. The object of judicial review of administrative action by the ordinary courts is to keep the administrative authorities within the bounds of their powers under the law. Appeal, on the other hand, means that the superior administrative tribunal or court to whom appeal lies under the law, has the power to reconsider the decision of the inferior tribunal on the merits. Appeal, however, is a creature of statue and there is no right of appeal unless there is a specific statutory provision creating that right.[7]

The power of revision is usually placed at the hands of the highest authority, e.g., the State Government, to correct any illegality or irregularity in the proceedings before the inferior authorities. There are: (a) Sometimes the statue expressly states that the power of revision may be exercised suo motu as well as on the application of the party aggrieved; (b) Sometimes the statue only authorizes the superior authority to use his power or revision suo motu or of his own motion, e.g., original s. 33 of the Income-tax Act, 1922. In such a case the party aggrieved has no right to relief and the revisional authority has no duty to perform, on the application of such party; (c) Difficulty of interpretation arises where neither the words ‘suo motu’, nor ‘on application’ are used by the statue.[8]

D. Nature and Scope

Judicial review of administrative action is perhaps the most important development in the field of public law in the second half of this century. In India, the doctrine of judicial review is the basic feature of Indian Constitution. Judicial review is the most potent weapon in the hands of the judiciary for the maintenance of the rule of law. Judicial review is the touchstone of the Constitution. The Supreme Court and High Courts are the ultimate interpreters of the Constitution. It is, therefore, their duty to find out the extent and limits of the power of coordinate branches, viz. executive and legislature and to see that they do not transgress their limits. This is indeed a delicate task assigned to the judiciary by the Constitution. Judicial review is thus the touchstone and essence of the rule of law.

The power of judicial review is an integral part of Indian Constitutional system and without it, there will be no government laws and the rule of law would become a teasing illusion and a promise of unreality. The judicial review, therefore, is a basic and essential feature of the Constitution and it cannot be abrogated without affecting the basic structure of the Constitution.[9]

In judicial review, the court is not concerned with the merits or correctness of the decision, but with the manner in which the decision is taken or order is made. A court of law is not exercising appellate power and it cannot substitute its opinion for the opinion of the authority deciding the matter. The areas where judicial power can operate are limited to keep the executive and legislature within the scheme of division of powers depends upon the facts and circumstances of each case. The dimension of judicial review must remain flexible.

It is a cardinal principle of Indian Constitution that no one howsoever highly placed and no authority lofty can claim to be the sole judge of its power under the Constitution. The rule of law requires that the exercise power by the legislature or buy the judiciary or by the government or by any other authority must be conditioned by the Constitution. Judicial review is thus the touchstone and repository of the supreme law of the land.

In recent times, judicial review of administrative action has become extensive and expansive. The traditional limitations have vanished and the sphere of judicial scrutiny is being expanded. Under the old theory, the courts used to exercise power only in cases of absence or excess or abuse of power. As the State activities have become pervasive and giant public corporations have come in existence, the stake of public exchequer justifies larger public audit and judicial control.[10]

The scope of judicial review in India is not a wide as in USA. The American Supreme Court can declare any law unconstitutional on the ground of its not being in “due process of law”, but the Indian Supreme Court has no such power. In India, outside the limitation imposed on the legislative powers, Parliament and State legislature are supreme in their respective legislative fields and the Court has no authority to question the wisdom or policy of the law duly made by the appropriate legislature. Another reason

is because the Indian Supreme Court has consistently refused to declare legislative enactments invalid on the ground that they violate the natural, social or political rights of citizens, unless it could be shown that such injustice was expressly prohibited by the Constitution.[11]

E. Justiciability

Judicial review must be distinguished from justiciability. The two concepts are nor synonymous. The power of judicial review goes to the authority of the court and can be exercised by the court in appropriate cases.

Justiciability is not a legal concept with fixes contents, nor is it susceptible of scientific verification. There is not and there cannot be a uniform rule regarding scope and reach of judicial review applicable to all cases. It varies from case to case depending upon subject-matter, nature of right and other relevant factors.

The power of judicial review relates to the jurisidcition of the court whereas justiciablity is hedged by self-imposed judicial restraint. A court exercising judicial review may refrain to exercise its power if it finds that the controversy raised before it is not based on judicially discoverable and manageable standards. Moreover, the area of justicibiality can be reduced or curtailed. Even when, exercise of power is bad, the court in its discretion decline to grant relief considering the facts and circumstances of the case.[12]

F. Limitations

Judicial review has certain inherent limitations. It is suited more for adjudication of disputes than for performing administrative functions. It is for the executive to administer the law and the function of the judiciary is to ensure that the Government carries out its duty in accordance with the provision of the Constitution.

The duty of the court is to confine itself to the question of legalist. It has to consider whether a decision-making authority exceeded its power, committed an error of law, violated rules of natural justice, and reached a decision which no reasonable man would have reached or otherwise abused

its powers. Though the court is not expected to act as a court of appeal, nevertheless, it can examine whether the “decision-making process” was reasonable, rational, not arbitrary or not violative of Article 14 of the Constitution. The parameters of judicial review must be clearly defined and never exceeded. If the authority has faultered in its wisdom, the court cannot act as super auditor.

Unless the order passed by an administrative authority is unlawful or unconstitutional, power of judicial review cannot be exercised. An order of administration may be right or wrong. It is the administrator’s right to trial and error and so long as it is bonafide and within the limits of the authority, no interference is called for. In short, power of judicial review is supervisory in nature. Unless this restriction is observed, the court, under the guise of preventing abuse of power by the administrative authority, will itself be guilty of usurping power.

Bernard Schwarts rightly stated:[13]

“If the scope of review is too broad, agencies are turned into little more than media for the transmission of cases to the courts. That would destroy the values of agencies created to secure the benefit of special knowledge acquired through continuous administration in complicated fields. At the same time, the scope of judicial inquiry must not be so restricted that it prevents full inquiry into the question of legality. If that question cannot be properly explored by the judge, the right to review becomes meaningless. It makes judicial review of administrative orders a hopeless formality for the litigant. … It reduces the judicial process in such cases to a mere feint.”

G. Conclusion

It is fundamental principle of law that every power must be exercised within the four corners of law and within the legal limits. Exercise of administrative power is not an exception to that basic rule. The doctrines by which those limits are ascertained and enforced form the very marrow of administrative law. Unfettered discretion cannot exist where the rule of law reigns. Again, all power is capable of abuse, and that the power to prevent the abuse is the acid test of effective judicial review.[14]

Under the traditional theory, courts of law used to control existence and extend of prerogative power but not the manner of exercise thereof. That position was, however, considerably modified after the decision in Council of Civil Service Unions v. Minister for Civil Service[15], wherein it was emphasized that the reviewability of discretionary power must depend upon the subject-matter and not upon its source. The extent and degree of judicial review and justifiable area may vary from case to case.[16]

At the same time, however, the power of judicial review is not unqualified or unlimited. If the courts were to assume jurisdiction to review administrative acts which are ‘unfair’ in their opinion (on merits), the courts would assume jurisdiction to do the very thing which is to be done by administration. If judicial review were to trespass on the merits of the exercise of administrative power, it would put its own legitimacy at risk.

It is submitted that the following observations of Frankfurter, I. in Trop v. Dulles,[17] lay down correct legal position:

“All power is, in Madison’s Phrase ‘of an encroaching nature’. Judicial Power is not immune against this human weakness. It also must be on guard against encroaching beyond its proper bounds, and not the less so since the only restraint upon it is self restraint.”

***

END NOTES:

[1] 1 Cranch 137 (1803).[2] Kailash Rai, Administrative Law, Allahabad Law Agency, Haryana, 2006, p. 395. See also L.P. Berths, Constitution and the Supreme Court, p. 16.[3] C.K. Takwani, Lectures on Administrative Law, Eastern Book Company, Lucknow, 2003, p. 236.[4] M.P. Jain and S.N. Jain, Principles of Administrative Law: An Exhaustive Commentary on the Subject containing case-law reference (Indian & Foreign), 6th Ed., Wadhwa and Company Nagpur, New Delhi, 2007, p. 1779.[5] (1980) 3 SCC 625 (677-78): AIR 1980 SC 1789 (1925-26). See also Fertilizer Corpn. Kamgar Union v. Union of India, (1981) 1 SCC 568 (574-

75): AIR 1981 SC 344 (347).[6] Tata Cellular v. Union of India, (1994) 6 SCC 651: AIR 1996 SC 11, 13.[7] Durga Das Basu, Administrative Law, 5th Ed., Kamal Law House, Calcutta, 1998, p. 413.[8] Ibid, p. 412.[9] C.K. Takwani, Supra note no. 3, p. 237.[10] Ibid., pp. 237-238.[11] M.V. Pylee, Constitutional Government in India, p. 379.[12] Ibid, p. 239.[13] Administrative Law, 2nd Edn., p. 584 cited in Tata Cellular v. Union of India, (1994) 6 SCC 651 (680): AIR 1996 SC 11, 13.[14] Wade, Administrative Law, (1994), pp. 39-41.[15] (1984) 3 All ER 935: (1984) 3 WLR 1174: (1985) AC 374.[16] Craig, Administrative Law, (1993), p. 291.[17] (1985) 35 US 86.

MAIN REFERENCES:

Basu, Durga Das, Administrative Law, 5th Ed., Kamal Law House, Calcutta, 1998.

Jain, M.P. and S.N. Jain, Principles of Administrative Law: An Exhaustive Commentary on the Subject containing case-law reference (Indian & Foreign), 6th Ed., Wadhwa and Company Nagpur, New Delhi, 2007.

Rai, Kailash, Administrative Law, Allahabad Law Agency, Haryana, 2006.

Takwani, C.K., Lectures on Administrative Law, Eastern Book Company, Lucknow, 2003.

Judicial Review of Administrative Action: The law revisited

One of the key chapters taught to law students in an Administrative Law course relates to

'judicial review of administrative action' in as much as judicial review has been declared by the

courts as a part of the basic structure of the constitutional ethos in India and also that in as

much as all administrative bodies are required to act in consonance with the legal regime and

principles of natural justice in dealing in pursuance of their actions.

In a recent decision, called upon the examine the validity of a Circular issued by the Director

General of Foreign Trade (DGFT) in respect of import of marbles in India, Justice S. Muralidhar

is the Delhi High Court culled out the following tests which are required to be observed to test

the validity of administrative action by the judiciary;

37. Two essential legal principles govern the exercise of the power of judicial review by a High

Court in matters such as these. First, the court will not sit in appeal over the ultimate decision of

the administrative body. It is really concerned about the procedure adopted in arriving at such

decision. Was it a fair, reasonable and just procedure? Were relevant materials considered and

irrelevant materials kept out? As far as the final decision is concerned, is it vitiated by malafides

or is it so arbitrary that no reasonable person would, in the circumstances, have arrived at it.

Second, in policy matters, the Court will be slow to interfere. As the case law reveals, where the

question is of reasonableness of restrictions imposed through an import policy, the degree of

deference shown by the judicial wing to the executive is greater. In Dy. Assistant Iron & Steel

Controller v. L. Manichand the Supreme Court explained: (SCC p. 337)

“11…… In granting licences for imports, the authority concerned has to keep in view various

factors which may have impact on imports of other items of relatively greater priority in the

larger interest of the over-all economy of the country which has to be the supreme

consideration; and an applicant has no absolute vested right to an import licence in terms of the

policy in force at the time of his application because from the very nature of things at the time of

granting the licence the authority concerned may often be in a better position to have a clearer

over-all picture of the various factors having an important impact on the final decision on the

allotment of import quota to the various applicants.”

38. It was observed in Liberty Oil Mills v. Union of India (SCC p. 477):

“6….. The import policy of any country, particularly a developing country, has necessarily to be

tuned to its general economic policy founded upon its constitutional goals, the requirements of

its internal and international trade, its agricultural and industrial development plans, its monetary

and financial strategies and last but not the least the international political and diplomatic

overtones depending on 'friendship, neutrality or hostility with other countries' (Glass Chotans

Importers and Users' Association v. Union of India [1962]1SCR862 . There must also be a

considerable number of other factors which go into the making of an import policy. Expertise in

public and political, national and international economy is necessary before one may engage in

the making or in the criticism of an import policy. Obviously courts do not possess the expertise

and are consequently incompetent to pass judgment on the appropriateness or the adequacy of

a particular, import policy. But we may venture to assert with some degree of accuracy that our

present import policy is export oriented. Incentives by way of import licences are given to

promote exports…..”

39. In M.P. Oil Extraction v. State of M.P. it was held (SCC, p.611):

“41…….The executive authority of the State must be held to be within its competence to frame

policy for the administration of the State. Unless the policy framed is absolutely capricious and,

not being informed by any reason whatsoever, can be clearly held to be arbitrary and founded

on mere ipsi dixit of the executive functionaries thereby offending Article 14 of the Constitution

or such policy offends other constitutional provisions or comes in conflict with any statutory

provision, the Court cannot and should not out step its limit and tinker with the policy decision of

the executive functionary of the State. This Court, in no uncertain term, has sounded a note of

caution by indicating that policy decision is in the domain of the executive authority of the State

and the Court should not embark on the unchartered ocean of public policy and should not

question the efficacy or otherwise of such policy so long the same does not offend any provision

of the statute or the Constitution of India. The supremacy of each of three organs of the State

i.e. legislature, executive and judiciary in their respective field of operation needs to be

emphasised. The power of judicial review of the executive and legislative action must be kept

within the bounds of constitutional scheme so that there may not be any occasion to entertain

misgivings about the role of judiciary in out stepping its limit by unwarranted judicial activism

being very often talked of in these days. The democratic set up to which the polity is so deeply

committed cannot function properly unless each of the three organs appreciates the need for

mutual respect and supremacy in their respective field.”

40. In Secretary to Govt. of Madras v. P.R. Sriramulu the Supreme Court observed (SCC p.

358):

“15. As pointed out earlier with reference to the decisions of this Court the State enjoys the

widest latitude where measure of economic regulations are concerned. These measures for

fiscal and economic regulation involve an evaluation of diverse and quite often conflicting

economic criteria, adjustment and balancing of various conflicting social and economic value

and interests. It is for the State to decide what economic and social policy it should pursue. It is

settled law that in view of the inherent complexity of the fiscal adjustments, the Courts give a

large discretion to the legislature in the matter of its references of economic and social policies

and effectuate the chosen system in all possible and reasonable ways. If two or more methods

of adjustment of an economic measure are available, the legislative preference in favour of one

of them cannot be questioned on the ground of lack of legislative wisdom or that the method

adopted is not the best or there are better ways of adjusting the competing interests and the claims as the legislature possesses the greatest freedom in such areas. It is also well settled that lack of perfection in a legislative measure does not necessarily imply its unconstitutionality as no economic measure has so far been discovered which is free from all discriminatory impact and that in such a complex area in which no fool proof

device exists, the Court should be slow in imposing strict and rigorous standard of scrutiny by reason of which all local fiscal schemes may be subjected to criticism under the Equal Protection clause.”

41. In P.T.R. Exports (Madras) P Limited v. Union of India, the Supreme Court observed:

“5. It would, therefore, be clear that grant of licence depends upon the policy prevailing as on

the date of the grant of the licence. The Court, therefore, would not bind the Government with a

policy which was existing on the date of application as per previous policy. A prior decision

would not bind the Government for all times to come. When the Government are satisfied that

change in the policy was necessary in the public interest, it would be entitled to revise the policy

and lay down new policy. The Court, therefore, would prefer to allow free play to the

Government to evolve fiscal policy in the public interest and to act upon the same. Equally, the

Government is left free to determine priorities in the matters of allocations or allotments or

utilisation of its finances in the public interest. It is equally entitled, therefore, to issue or

withdraw or modify the export or import policy in accordance with the scheme evolved. We,

therefore, hold that the petitioners have no vested or accrued right for the issuance of permits

on the MEE or NQE, nor the Government is bound by its previous policy.”

42. In Ugar Sugar Works Limited v. Delhi Administration the Supreme Court observed thus

(SCC p. 643):

“18. ………. It is well settled that the Courts, in exercise of their power of judicial review, do not

ordinarily interfere with the policy decisions of the executive unless the policy can be faulted on

grounds of mala fide, unreasonableness, arbitrariness or unfairness etc. Indeed, arbitrariness,

irrationality, perversity and mala fide will render the policy unconstitutional. However, if the

policy cannot be faulted on any of these grounds, the mere fact that it would hurt business

interests of a party, does not justify invalidating the policy. In tax and economic regulation

cases, there are good reasons for judicial restraint, if not judicial deference, to judgment of the

executive. The Courts are not expected to express their opinion as to whether at a particular

point of time or in a particular situation any such policy should have been adopted or not. It is

best left to the discretion of the State.”

43. As far as the present case is concerned, it is not possible to hold that the transition from the

dual policy to a unified policy was either arbitrary or irrational. The decision-making process

itself appears to be a well deliberated one where matters were considered at different levels.

The Respondents were faced with an unenviable task of accommodating several competing

interests. How these should in fact be resolved should be left to the Respondents. The court

cannot be expected to sit in appeal over the decision of the government to introduce a

requirement for eligibility for grant of an import licence and opine that one criterion is more

appropriate than the other.

Have a look at the decision.

Administrative Law And Judicial Review Of Administrative Action

Administrative Law And Judicial Review Of Administrative Action*

By Justice Markandey Katju**

Cite as : (2005) 8 SCC (J) 25

The topic of "Administrative law and judicial review of administrative action" is a very

important subject in modern times. I

intend to dwell on the aspects of how administrative law came into existence, its objects and its

broad principles.

According to Wade, administrative law is the law relating to the control of powers of the

executive authorities1 To

consider why such a law became necessary, we have to consider its historical background.

Up to the 19th century the functions of the State in England were confined to (i) defence of the

country from foreign

invasion, and (ii) maintenance of law and order within the country.

Feudal, agricultural society, was relatively simple and social relations were uncomplicated.

There were few laws, mainly

customary (not statutory). But with the advent of industrial revolution in the 18th and 19th

centuries, society became

complex. Concentration of people in urban areas called for new regulatory State authorities for

town planning, housing

improvement, public health, education, factory management, street lighting, sewerage, drainage,

sanitation, schemes for

providing water, electricity, etc. Also the early 20th century laid the foundation for a Welfare

State dealing with health

insurance, unemployment allowance, sickness and old age benefits, free and compulsory

education, etc.

This vast expansion in the State functions called for a huge amount of legislation and also for

wide delegation of State

functions by Parliament to executive authorities, so also was there a need to create a body of

legal principles to control

and to check misuse of these new powers conferred on the State authorities in this new situation

in the public interest.

Thus, emerged administrative law. Maitland pointed out in his Constitutional History:

"Year by year the subordinate Government of England is becoming more and more important.

We are becoming a much

governed nation, governed by all manner of councils and boards and officers, central and local,

high and low, exercising

the powers which have been committed to them by modern statutes."

But in the early 20th century following the tradition of Dicey's classic exposition in his The Law

of the Constitution, there

was a spate of attacks on parliamentary delegation culminating in the book New Despotism by

the then Chief Justice of

England, Lord Hewart published in 1929. In response, the British Government in 1932 set up a

committee called the

Committee on Ministerial Powers headed by Lord Donoughmore, to examine these complaints

and criticisms. However,

the Donoughmore Committee rejected the argument of Lord Hewart and accepted the reality that

a modern State cannot

function without delegation of vast powers to the executive authorities, though there must be

some control on them.

Parliament could theoretically exercise this control, but in practice it could not, since it did not

have the time. Hence it

became the duty of the Judges, though unelected, to become representatives of the people and

ensure that executive

authorities do not abuse their powers, but instead use it in the public interest.

But Judges too are not supposed to act arbitrarily. Hence a body of legal principles was created

(largely by Judges

themselves in their judgments and not by Parliament) on the basis of which Judges had to

exercise their powers of

judicial review of administrative action on settled principles but not arbitrarily. It is this body of

rules which is known as

administrative law.

Being largely Judge-made, administrative law is not contained in any Administrative Law Act,

just as the income tax law

is contained in the Income Tax Act or the sales tax law in the Sales Tax Act. Hence some writers

have criticised

administrative law as a "wilderness of single instances, and not a separate, coherent branch of

law". However, the

fundamental principle behind administrative law has always remained the same, namely, that in a

democracy the people

are supreme, and hence all State authority must be exercised in the public interest.

It is a mistake to think that administrative law is necessarily antagonistic to efficient government.

As Wade points out

"intensive administration will be more tolerable to the citizen, and the Government's path will be

smoother, where the law

can enforce high standards of legality, reasonableness and fairness".

As pointed out by Sir John Donaldson, M.R., in R. v. Lancashire CC, ex p Huddleston2 All ER

p. 945c the development

of administrative law

"has created a new relationship between the courts and those who derive their authority from the

public law, one of

partnership based on a common aim, namely, the maintenance of the highest standards of public

administration".

In Tata Cellular v. Union of India3 (para 113) the Supreme Court laid down the following basic

principles relating to

administrative law: (SCC pp. 687-88, para 94)

The Practical Lawyer

http://www.supremecourtcases.com Eastern Book Company Generated: Saturday, August 13,

2011(1) The modern trend points to judicial restraint in administrative action;

(2) the Court does not sit as a court of appeal over administrative decisions, but merely reviews

the manner in which the

decisions were made;

(3) the Court does not have the expertise to correct administrative decisions. If a review of the

administrative decisions is

permitted it will be substituting its own decision without the necessary expertise, which itself

may be fallible;

(4) a fairplay in the joints is a necessary concomitant for the administrative functioning.

(5) however, the administrative decision can be tested by application of the Wednesbury

principle of reasonableness,

and must be free from arbitrariness, bias or mala fides.

There are two kinds of controls on executive powers viz.:

(1) statutory, and

(2) non-statutory.

Statutory controls

Statutory controls are given in the statute (or rules or regulations made under the statute). Any

executive action in

violation of the same will be declared illegal by the courts, by applying the ultra vires doctrine.

Thus, where the London County Council had statutory powers to purchase and operate

tramways, it was held by the

House of Lords that it had no power to run omnibuses, which was not incidental to the running

of tramways4 Similarly a

local authority with the power to acquire land other than "park, garden or pleasure house" acts in

excess of jurisdiction in

acquiring land which is part of a park5

An executive authority may also act unlawfully if it fails to perform a duty imposed upon it by

statute such as maintenance

of civic services (e.g. sewerage, drainage, water supply, etc.) by the Municipalities or other local

bodies whose duty

under the statute is to maintain such services. Here also a mandamus will issue from the courts to

compel such authority

to perform its statutory duty.

Where the statute delegates a power to a particular authority, that authority cannot sub-delegate

that power to another

authority or person unless the statute permits such sub-delegation.

Similarly, discretion exercised by the prescribed authority on the direction of a higher authority

would be illegal6

When the statute prescribes the manner of doing an act, the authority must do it in that manner

alone7

Difficulty, however, arises in the matter of what is called "subjective discretion" conferred by the

statute. An instance of

such subjective discretion is where the statute says that an executive authority can take such

decision "as it deems fit".

Another example is where the statute says that action can be taken or order passed where the

authority has "reasonable

grounds to believe" to take that action or pass such order e.g. Section 132 of the Income Tax Act

which confers power on

the Commissioner of Income Tax to order search and seizure where he has "reason to believe"

that some person is

concealing his income.

In Liversidge v. Anderson8 the Defence (General) Regulations, 1939 provided:

"If the Secretary of State has reasonable cause to believe any person to be of hostile origin or

association he may make

an order against that person directing that he be detained."

The detenu Liversidge challenged the detention order passed against him by the Secretary of

State. The majority of the

House of Lords, except Lord Atkin, held that the Court could not interfere because the Secretary

of State had mentioned

in his order that he had reasonable cause to believe that Liversidge was a person of hostile origin

or association.

Liversidge8 was delivered during the Second World War when the executive authority had

unbridled powers to detain a

person without even disclosing to the Court on what basis the Secretary had reached to his belief.

However,

subsequently, the British courts accepted Lord Atkin's dissenting view that there must be some

relevant material on the

basis of which the satisfaction of the Secretary of State could be formed. Also, the discretion

must be exercised keeping

in view the purpose for which it was conferred and the object sought to be achieved, and must be

exercised within the

four corners of the statute9

Sometimes a power is coupled with a duty10 Thus, a limited judicial review against

administrative action is always



2011available to the courts.

Non-statutory controls

Some of the non-statutory controls are:

(a) The Wednesbury principle

(b) Rules of natural justice

(c) Proportionality (See Teri Oat Estates (P) Ltd. v. Union Territory, Chandigarh11, Union of

India v. Rajesh P.U.12, etc.)

(d) Promissory estoppel13

(e) Legitimate expectation14

We may only consider some of these in detail.

Wednesbury Principle

Up to 1947 the law in England was that the courts could interfere only with judicial or quasi-

judicial decisions and not with

administrative decisions. This legal position changed after the famous decision of Lord Greene in

Associated Provincial

Picture Houses Ltd. v. Wednesbury Corpn.15 in which it was said: (All ER pp. 682 H-683 A)

A person entrusted with discretion must, so to speak, direct himself properly in law. He must call

his attention to matters

which he is bound to consider. He must exclude from his consideration matters which are

irrelevant to what he has to

consider. If he does not obey those rules he may truly be said to be acting unreasonably.

Similarly, there may be

something so absurd that no sensible person could ever dream that it lay within the powers of the

authority.

The above observation incorporates what is frequently called as the Wednesbury principle.

The courts often intervene to quash as illegal the exercise of administrative discretion on the

ground that it suffers from

"Wednesbury unreasonableness".

Thus, in Dy. Director of Consolidation v. Deen Bandhu Rai16, the settlement officer rejected an

application for permission

to effect an exchange of holdings on the grounds (i) that the granting of the permission would

entail considerable work on

the part of officers of the department, and (ii) that the applicants were big landholders. The

Supreme Court held that

these reasons were not germane and pertinent for the rejection of the petitions.

In Barium Chemicals Ltd. v. Company Law Board17 the Secretary of the Company Law Board

issued an order under

Section 237(b) of the Companies Act, 1956 appointing inspectors to investigate the affairs of a

company. Section 237(b)

of the Act authorised such an appointment to investigate the affairs of a company "if, in the

opinion of the Central

Government" there were circumstances suggesting (a) that the business of the company was

being conducted with the

intent to defraud its creditors, members, or any other person; (b) that the persons concerned in

the formation of the

company or the management of its affairs had been guilty of fraud or misconduct towards the

company or towards any of

its members; (c) that the members of the company had not given out all the information with

respect to its affairs. The

Supreme Court held that before the discretion conferred by Section 237(b) of the Companies Act

can be exercised, there

must exist circumstances which in the opinion of the authority suggest the grounds set out in the

statute.

Unfettered discretion would also be inconsistent with Article 19 of the Constitution which

permits only reasonable

restrictions on the rights conferred by that Article. Similarly, it would also be violative of Article

14 which prohibits

arbitrariness18 In Shalini Soni v. Union of India19 the Supreme Court observed: (SCC p. 549,

para 7)

"It is an unwritten rule of the law, constitutional and administrative, that whenever a decision-

making function is entrusted

to the subjective satisfaction of a statutory functionary, there is an implicit obligation to apply his

mind to pertinent and

proximate matters only, eschewing the irrelevant and the remote."

In Rohtas Industries v. S.D. Agarwal20, an investigation into the affairs of a company was

ordered under Section 237 of

the Companies Act, 1956. The Company Law Board took into account the fact that there were

complaints of misconduct

against one of the leading directors of the company in relation to other companies subject to his

control for which he was

being prosecuted. The Court held that this factor was irrelevant in establishing fraud.

The Wednesbury principle is often misunderstood to mean that any administrative decision

which is regarded by the

Court to be unreasonable must be struck down. The correct understanding of the Wednesbury

principle is that a decision

will be said to be unreasonable in the Wednesbury sense if (i) it is based on wholly irrelevant

material or wholly irrelevant



2011consideration, (ii) it has ignored a very relevant material which it should have taken into

consideration, or (iii) it is so

absurd that no sensible person could ever have reached to it.

As observed by Lord Diplock in Council of Civil Service Unions v. Minister for the Civil

Service21, a decision will be said

to suffer from Wednesbury unreasonableness if it is "so outrageous in its defiance of logic or of

accepted moral

standards that no sensible person who had applied his mind to the question to be decided could

have arrived at it" (All

ER p. 951a-b).

An administrative decision cannot be struck down by the Judge merely because he disagrees with

the administrator22

There may be degrees of unreasonableness, and the Wednesbury unreasonableness refers only to

the extreme degree

of unreasonableness which no sensible person could reach after taking into account the relevant

materials or relevant

considerations. Thus, in W., Re,23 Lord Hailsham observed: (All ER p. 56g-h)

"Two reasonable parents can perfectly reasonably come to opposite conclusions on the same set

of facts without

forfeiting their title to be regarded as reasonable. ... Not every reasonable exercise of judgment is

right, and not every

mistaken exercise of judgment is unreasonable."

Hence, the Wednesbury unreasonableness means "unreasonableness verging on absurdity" as

observed by the House

of Lords in Puhlhofer v. Hillingdon L.B.C.24

Rules of Natural Justice

The rules of natural justice were originally only two viz.:

1. Audi alteram partem i.e. the person(s) to be affected by an order of the authority should be

heard before the order is

passed, and

2. The rule against bias.

Subsequently, some more rules of natural justice are in the process of development e.g. that the

administrative authority

should give reasons for its decisions, particularly when the decisions affect the rights and

liabilities of the citizens.

It must, however, be made clear that the rules of natural justice are flexible, and are not a

straitjacket formula25 In

exceptional cases not only can they be modified but even excluded altogether26 Natural justice is

not an unruly horse. If

fairness is shown, there can be no complaint of breach of natural justice27

As regards the rule audi alteram partem, up to 1964 the legal position in England was that in

judicial and quasi-judicial

proceedings opportunity of hearing had to be given, but it was not necessary to do so in

administrative proceedings. This

legal position changed in Ridge v. Baldwin28 in which the House of Lords held that opportunity

of hearing had to be

given even in administrative proceedings if the administrative order would affect the rights and

liabilities of the citizens.

This view of the House of Lords was followed by the Supreme Court in State of Orissa v. Dr.

Binapani Dei29 and State of

Maharashtra v. Jalgaon Municipal Council30 wherein it was held that administrative orders

which involve civil

consequences have to be passed consistently with the rules of natural justice. The expression

"civil consequences"

means where rights and liabilities are affected. Thus, before blacklisting a person he must be

given a hearing31

It may be noted that even if the statute does not expressly require that opportunity of hearing

must be given before

passing an order which affects rights and liabilities, the courts have held that such opportunity of

hearing must be given

unless expressly excluded by the statute32 Thus, natural justice is an implied requirement of

administrative decisions

which affects rights and liabilities.

It may be mentioned that a hearing need not always be an oral hearing. In certain circumstances,

the Administrator can

only issue a show-cause notice to the party likely to be affected and on his/her reply can pass the

decision without giving

a personal hearing to the parties. However, in certain circumstances where the party may be very

seriously affected the

courts have insisted that an oral hearing with opportunity of presenting witnesses and cross-

examining the witnesses on

the other side must be given.

Similarly, the principle that "no man should be a judge in his own cause" disqualifies an

Administrator from giving a

decision which affects the rights and liabilities, if he is biased.

It may, however, be pointed out that in H.C. Narayanappa v. State of Mysore33 the Supreme

Court observed that the

Minister or officer invested with the power to hear objections to a scheme is acting in his official

capacity and unless there

is reliable evidence to show that he is actually biased, his decision will not be liable to be called

in question merely

because the objections to the government scheme are heard by the government itself or by its

officers.

The requirement to give reasons in administrative decisions which affect rights and liabilities has

been held to be



2011mandatory by the Supreme Court in S.N. Mukherjee v. Union of India34 This reduces the

chances of arbitrariness on the

part of the authority, as the reasons recorded by him are subject to judicial scrutiny by the higher

courts or authorities.

Before concluding, it must also be mentioned that there are certain administrative matters which

are inappropriate for

judicial review. One of these is policy decisions of the government or of the executive authority

which ordinarily should

not be interfered with by the courts unless they are clearly violative of the statute or shockingly

arbitrary35, Union of India

v. International Trading Co.14, etc. In the instant case the facts were that the Central

Government had initially decided to

locate the headquarters of South Western Railways at Bangalore. Later it was decided to locate it

at Hubli, and this

decision was challenged. The Supreme Court held that it was a policy decision and hence the

Court cannot interfere,

even if the decision was political36

Similarly, maintenance of law and order is an executive function, and the courts should not

ordinarily interfere with the

same37

Apart from that, practically every legal system recognises certain subjects as inappropriate for

judicial review e.g. foreign

affairs, declaration of wars, etc.

Remedies

Remedies for enforcing administrative law are available before the higher judiciary e.g. the

Supreme Court under Article

32 of the Constitution and the High Courts under Article 226 of the Constitution. The higher

judiciary can issue writs of

certiorari, mandamus, habeas corpus, prohibition and quo warranto and also issue orders or

directions "in the nature of

writs".

The language used in Articles 32 and 226 is thus wide, and it has been held that the Indian courts

have wider powers

than the British courts in issuing writs38 Article 226 confers powers on the High Court not only

to issue prerogative writs,

but also issue order or direction to enforce fundamental and other legal rights39 Hence the High

Courts in India are not

confined to the procedural technicalities of the English rules40 The Court can also mould the

relief to meet the peculiar

and complicated requirements of this country, provided the High Court does not contravene any

provisions of the

Constitution or the law.

A writ can be issued by the High Courts and the Supreme Court not only to the Government, but

also to what are called

instrumentalities of the State. A writ of certiorari will be issued when the court finds that there is

an error of law apparent

on the face of record. A mandamus will be issued to a public authority to compel it to do its

public duty.

In the grants of public contracts the courts usually (though not invariably) insist that such grants

be made by public

auction/public tender after advertising the same in well-known newspapers having wide

circulation so that there is

transparency and compliance with Article 14 of the Constitution. Such grants by private

negotiation are ordinarily

disapproved41

A writ can be issued to enforce the statute or statutory rule or order. However, a question may

arise whether it can be

issued to enforce non-statutory government orders or executive instructions.

The earlier decisions of the Supreme Court were of the view that no mandamus will issue to

enforce mere administrative

instructions which have no statutory force42 However, subsequently, certain exceptions have

been carved out to the

above principle. In certain exceptional circumstances, mandamus can be issued to enforce a non-

statutory administrative

order. Some of such exceptions are:

(i) Where the principle of promissory estoppel applies e.g. in Union of India v. Indo Afghan

Agencies Ltd.43, Motilal

Padampat Sugar Mills Co. Ltd. v. State of U.P.44, etc.

(ii) Where the principle of legitimate expectation applies45

(iii) In service matters, where there are no statutory rules, administrative instructions can fill in

the gap, and are

enforceable46

(iv) In many matters e.g. awards of public contracts, an executive authority must be rigorously

held to the standards by

which it professes its actions to be judged, even if such actions are non-statutory47

I am not going into further details of administrative law or judicial review of administrative

action as I only intended to set

out the broad outlines.



2011* Lecture delivered in the "Nain Singh Memorial Lecture" held on 26-9-2005 at the

Uttaranchal Academy of

Administration, Nainital, Uttaranchal. Return to Text

** Hon'ble Chief Justice of the High Court of Madras. Return to Text

- Administrative Law (9th Edn.) Return to Text

- (1986) 2 All ER 941 (CA) Return to Text

- (1994) 6 SCC 651 Return to Text

- London County Council v. Attorney General, 1902 AC 165 (HL) Return to Text

- White and Collins v. Minister of Health, (1939) 2 KB 838 : (1939) 3 All ER 548 (CA) Return

to Text

- Anirudhsinhji Karansinhji Jadeja v. State of Gujarat, (1995) 5 SCC 302 : 1995 SCC (Cri) 902

Return to Text

- Bhavnagar University v. Palitana Sugar Mill (P) Ltd., (2003) 2 SCC 111; Capt. Sube Singh v.

Lt. Governor of Delhi,

(2004) 6 SCC 440 Return to Text

- 1942 AC 206 : (1941) 3 All ER 338 (HL) Return to Text

- Clariant International Ltd. v. SEBI, (2004) 8 SCC 524 Return to Text

- G.P. Singh: Principles of Statutory Interpretation (9th Edn.) p. 395. Return to Text


- (2003) 7 SCC 285 : 2003 SCC (L&S) 1048 Return to Text

- State of Punjab v. Nestle India Ltd., (2004) 6 SCC 465 Return to Text

- Union of India v. International Trading Co., (2003) 5 SCC 437 Return to Text

- (1947) 2 All ER 680 : (1948) 1 KB 223 (CA) Return to Text

- (1964) 4 SCR 560 : AIR 1965 SC 484 Return to Text

- 1966 Supp SCR 311 : AIR 1967 SC 295 Return to Text

- Maneka Gandhi v. Union of India, (1978) 1 SCC 248 Return to Text

- (1980) 4 SCC 544 : 1981 SCC (Cri) 38 Return to Text



- Gazi Saduddin v. State of Maharashtra, (2003) 7 SCC 330 : 2003 SCC (Cri) 1637 Return to

Text


- (1986) 1 All ER 467 (HL) Return to Text

- Bar Council of India v. High Court of Kerala, (2004) 6 SCC 311 (paras 49 and 50). Return to

Text

- Union of India v. Tulsiram Patel, (1985) 3 SCC 398 : 1985 SCC (L&S) 672 (para 101). Return

to Text

- Chairman, Board of Mining Examination v. Ramjee, (1977) 2 SCC 256 : 1977 SCC (L&S) 226

Return to Text




- Raghunath Thakur v. State of Bihar, (1989) 1 SCC 229 Return to Text

- State Govt. Houseless Harijan Employees' Assn. v. State of Karnataka, (2001) 1 SCC 610

(paras 27 to 30). Return to

Text


- (1990) 4 SCC 594 : 1990 SCC (Cri) 669 Return to Text

- Union of India v. Manu Dev Arya, (2004) 5 SCC 232 : 2004 SCC (L&S) 769 Return to Text

- Union of India v. Kannadapara Sanghatanegala Okkuta, (2002) 10 SCC 226 Return to Text

- State of Karnataka v. Dr. Pravin Bhai Thogadia, (2004) 4 SCC 684 : 2004 SCC (Cri) 1387;

Rama Muthuramalingam v.

Dy. Supdt. of Police, AIR 2005 Mad 1 Return to Text

- Dwarkanath v. ITO, (1965) 3 SCR 536 : AIR 1966 SC 81 Return to Text

- Air India Statutory Corpn. v. United Labour Union, (1997) 9 SCC 377 : 1997 SCC (L&S)

1344; P.J. Irani v. State of

Madras, (1962) 2 SCR 169 : AIR 1961 SC 1731 Return to Text

- T.C. Basappa v. T. Nagappa, (1955) 1 SCR 250 : AIR 1954 SC 440 Return to Text

- S. Selvarani v. Commr., Karaikudi Municipality, (2005) 1 CTC 81 Return to Text

- G.J. Fernandez v. State of Mysore, (1967) 3 SCR 636 : AIR 1967 SC 1753; J.R. Raghupathy v.

State of A.P., (1988) 4

SCC 364 Return to Text



- J.P. Bansal v. State of Rajasthan, (2003) 5 SCC 134 : 2003 SCC (L&S) 605, paras 25 to 30.

Return to Text

- Amarjit Singh Ahluwalia (Dr.) v. State of Punjab, (1975) 3 SCC 503 : 1975 SCC (L&S) 27,

para 8; B.N. Nagarajan v.

State of Mysore, (1966) 3 SCR 682 : AIR 1966 SC 1942; Sant Ram Sharma v. State of

Rajasthan, (1968) 1 SCR 111 :



2011AIR 1967 SC 1910 Return to Text

- Ramana Dayaram Shetty v. International Airport Authority of India, (1979) 3 SCC 489, para

10. Return to Text



2011

General Principle of Judicial Review on Administrative Action in Indian Legal System

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