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JUDICIAL REVIEW OF ADMINISTRATIVE DISCRETION[1] (ACTION)

Table of Contents

QUESTION BANK

Q.1. What is Administrative Discretion? State limitations thereon.

Q.2 What is meant by ‘Administrative Discretion’? Can it be challenged in court?

Q.3. Discretion does not mean whims and fancies but it is judicious prerogative. Discuss.

SHORT NOTES

Doctrine of colourable legislation.
Principal of Estoppel.

SYNOPSIS

INTRODUCTION
ADMINISTRATIVE DISCRETION MEANING

1) The administrative discretion means ‘power of being administratively discrete

2) According to Prof. Frund

III. JUDICIAL REVIEW: IT’S NEED:-

JUDICIAL REVIEW-

MEANING, NATURE AND SCOPE

GROUNDS OF JUDICIAL REVIEW

1) Failure to Exercise Discretion

a) Sub-Delegation
b) Imposing fetters on discretion by self-imposed rules of policy
c) Acting under dictation
d) Non-application of mind
e) Power coupled with duty

2) Excess or abuse of discretion

a) Absence of power
b) Exceeding Jurisdiction
c) Irrelevant Considerations
d) Leaving out relevant considerations
e) Mixed Considerations
f) Mala Fide
g) Improper Object
h) Colourable exercise of power
i) Non-Observance of natural justice
ii) Unreasonableness
INTRODUCTION:-

The State has given up the traditional theory of ‘laissez-fair’, and the old ‘police-State[2]’ has now become a ‘welfare State’. Consequently,[3] its functions have increased enormously, and it touched every aspect of an individual’s life right, from providing nutritious[1] foods to protecting their lives. It caused a heavier workload on administrative functions than the rest of the two organs of the Government, i.e. legislature and judiciary. The administrators administer the laws enacted by the legislatures, enact laws under delegated legislation and interpret[4] laws through administrative tribunals.

Therefore, to perform their functions effectively, vast discretionary powers are conferred upon administrators.

ADMINISTRATIVE DISCRETION MEANING[5]:-

1)Administrative discretion means ‘power of being administratively discrete’.

It implies the authority to do an act or to decide a matter with discretion. In other words, the administrative authority vested with discretion is entrusted with an option and thus is free to act in its discretion.

2) According to Prof. Frund: –

“When we speak of administrative discretion, we mean that a determination (i.e. decision) may be reached, in part at least, upon the basis of consideration (factor) not entirely susceptible (influenced) of proof or disproof—- it may be practicable convenient to say that discretion includes the case in which the ascertainment of fact is legitimately left to administrative determination”.

In other words, the decision is taken by an administrative authority not only on the basis of evidence brought before it but according to the policy or expediency and in the exercise of discretionary power conferred on it.

III. JUDICIAL REVIEW: ITS NEED[6]:-

As discussed earlier, an executive exercises not only administrative (executive) functions but also legislative and judicial functions. Thus, all these three powers are concentrated in one hand of administration to some extent. It is, therefore, against the principle of division of power, which is the backbone of a democratic form of Government.

As stated by Lord Action, “every power tends to corrupt, and absolute power tends to corrupt absolutely”. It is true that power is subject to its abuse (misuse); the wider the discretion, the greater the possibility of its abuse (misuse). Therefore, such power/discretion must be kept within its legal limits to ensure the Government of law. Judicial review is the weapon in the hands of judges to keep administrative powers within legal limits.

Discretionary powers conferred upon the administrators are of different types. They may extend from simple ministerial functions to powers which seriously affect the right of individuals, e.g. acquisition of property for a public purpose, control of trade relations, industry, business, investigation, confiscation and destruction of property, detention of persons etc. Therefore, the need was felt to control discretionary administrative actions.

JUDICIAL REVIEW[7]–

MEANING, NATURE AND SCOPE:-

Judicial Review is a weapon in the hands of judges whereby the court can hold any (a) law, (b) Order based upon such law, or (c) any action of a public authority as unconstitutional and unenforceable[8].

In India, judicial review of (a) legislative, (b) judicial, or (c) administrative action can be taken on the grounds of unconstitutionality etc.

Under this topic, we are specifically concerned with judicial review of administrative action.

Discretionary power is conferred on administrators to perform their functions properly and effectively; therefore, judicial review of every administrative action cannot be taken only in appropriate cases. Therefore, the power of the court to take judicial review is of supervisory nature.

As a general rule, it is accepted that courts have no power to interfere in the actions taken by administrative authorities in the exercise of discretionary powers.

In The State Financial Corporation V/s. J. Oil Mills [9]

Supreme Court observed that it is obligatory on administrative authority even though it is wrong, and courts should not interfere in it unless the action is unfair, unreasonable, or minified.

Judicial review works as a protection rather than a weapon against administrative action.

GROUNDS OF JUDICIAL REVIEW[10]:-

The judicial review of administrative action can be taken on the following grounds –

Failure to Exercise Discretion[11]:-

Discretionary power is conferred on administrative authority with some object. Therefore, that power shall be exercised by the authorities in appropriate cases. Court declares the action of administrative authority bad if it fails to exercise discretionary power conferred on it in the following circumstances.

a) Sub-Delegation[12]:-

‘Delegatous non protest delegar,’ i.e. the delegates can not further delegate, is well-settled law. Therefore, an authority on which discretionary power has been conferred must exercise that power himself and not to further delegate it. Sub-delegation of discretionary power, though to expedite official business, is invalid if not legally permitted. It is deemed as a non-exercise of discretionary power by an authority on which it was originally conferred.

In Sahni Silk Mills V/s. ESI Corporation[13]

Facts: – The Parent Act[14] enabled the corporation to delegate its power of recovering damages to the Director General. Director General, however, Sub-delegated the power to Regional Directors.

Court held: – That since there was no provision permitting the Director General to sub-delegate his power to regional Directors, the action was bad.

b) Imposing fetters on discretion by self-imposed rules of policy[15]:-

An authority entrusted with discretionary power shall exercise it after considering the facts and circumstances of each individual case. However, if the authority imposes fetters on its own discretion by adopting fixed rules of policy to be applied in all cases coming before it (irrespective of their different facts and circumstances), it is a failure to exercise discretion. In each case, application of mind is expected for the exercise of discretionary power by that authority.

In Gell V/s. Faja Noora[16]

Facts: – The Bombay Police Act 1863 had empowered Commissioners of Police discretion to issue licenses to the carriages or to refuse a licence for any carriage ‘which he may consider insufficient or otherwise unfit for the conveyance of the public’. Instead of applying this discretionary power to individual cases, the commissioner issued a general order requiring carriages of a particular pattern for granting a licence.

Bombay High Court Held: – That the order was bad because the commissioner had imposed fetters on his discretion by self-imposed rules of policy and failed to consider the case of each carriage as to whether or not it was fit for the conveyance of the public.

c) Acting under dictation[17]

Administrative authority on which discretionary power is conferred is expected to exercise that power by applying its own mind; therefore, acting under the dictation (instructions of superior authority or delegation of such power) is deemed as a ‘failure to exercise discretion by that authority.

d) Non-application of mind:-[18]

When an authority on which discretionary power has been conferred acts mechanically without applying its mind with due care and caution, the action is bad, on the ground of failure to exercise direction.

e) Power coupled with duty[19]:-

Several statutes confer discretionary powers on administrative authorises to be exercised by them; such discretionary powers given in statutes are in a permissive language such as “may”, “it shall be lawful”, “it may be permissible” etc. The question relating to discretionary power comes as to whether it depends upon the sweet will of administrative authority to use or not to use such discretionary power conferred on them?.

In Julius V/s. Lord Bishop of Oxford[20]

Facts: – the Bishop was empowered to issue a commission of inquiry in case of alleged misconduct by a Clergyman, either on an application by someone or by a Bishop sue motu[21]. The application was made before Bishop, and he refused it. So the question arose whether Bishop had a right to refuse the commission.

Earl Cairns Judge Observed:- that “where a power is deposited with a public officer for the purpose of being used for the benefit of persons, that power ought to be exercised, and the court will require it to be exercised”.

2) Excess or abuse of discretion[22]:-

Administrative authorities shall exercise discretionary power conferred upon them within legal limits, but when the mode of exercising discretionary power is improper or unreasonable, there is an abuse of power.

Mr. Antony X. Fernandes V/s. State of Goa

[2008 (3) All M R 715]

Bombay High Court Held that- administrative actions and decisions should not be contrary to constitutional mandate and must be in the public’s interest. The law places an obligation upon the State to have transparency in its administration.

Court declares the action of administrative authority bad if it has exceeded or abused the discretionary power conferred on it.

Excess or abuse of discretion may be inferred from the following circumstances:-

These various forms of abuse of discretion may overlap sometime.

a) Absence of power[23]:-

Administrative authority cannot exercise power which is not conferred on it or cannot exercise power in excess of what is given to it; in such circumstances, action is bad on the ground of lack of power[24].

b) Exceeding Jurisdiction[25]:-

An administrative authority shall exercise power within the limits of statutes. The court will declare it ultra vires if it exceeds the limits, e.g. an officer empowered to grant a loan of Rs. 10,000/- grants a loan of Rs. 20,000/.

c) Irrelevant Considerations[26]:-

A power conferred on administrative authority by a statute shall be exercised on the considerations relevant to the purpose for which it is conferred. However, if the authority takes into account wholly irrelevant or extraneous considerations, the action will be ultra-vires and bad. Thus, when the red-haired teacher was dismissed because she had red hair, the action was terrible on the ground of taking into account irrelevant considerations.

d) Leaving out relevant considerations [27]:-

As discussed already, an administrative authority cannot take into account irrelevant, extraneous considerations; similarly, if the authority fails to consider relevant considerations, an action taken by the authority is bad.

e) Mixed Considerations[28]:-

In this case, the action of the administrative authority is based partly on relevant and partly on irrelevant or extraneous considerations. Therefore, the court shall be careful in such circumstances while declaring action bad.

In State of Orissa V/s. Bidyabhusan[29]

Facts: – A government servant was dismissed from the service on the ground of certain charges, some charges were proved, and some were not proved.

Supreme Court held:-the order of dismissal proper; it observed that “it was not for the court to consider whether on the proved grounds alone the punishment of dismissal can be sustained”.

f) Mala Fide[30]:-

It is rightly said that “power tends to corrupt, and absolute power tends to corrupt absolutely”. Therefore, courts must see that all authorities shall exercise their powers properly, lawfully, and in good faith (i.e. in bona fide). If power is used mala fidelity, i.e. with ill-will or dishonest intention or with a corrupt motive, the action would be declared bad.

In Rowjer V/s. State of A. P.[31]

Facts: – The State Road Transport Corporation had framed a scheme for the nationalisation of certain transport routes. This was done as per the directions of the Chief Minister. The petitioner alleged that the particular routes were selected to take vengeance against the private transport operations of that area as they were his political opponents.

Held:- Supreme Court upheld the contention and quashed the order.

g) Improper Object[32]:-

A statutory power conferred on the authority shall be exercised for that purpose alone and not for any other purpose. The action is bad if it is used for any other purpose than for which it was conferred.

h) Colourable exercise of power[33]:-

Where power is exercised by the authority ostensibly[34] for the purpose for which it was conferred, but in reality, it is exercised for some other purpose, it is called ‘colourable exercise of power’. In other words, it is the exercise of power for any other purpose under the “colour” or “guise” of legality.

Similarly, suppose the legislature enacts a law on the assumption that it has the power to legislate, and eventually, it turns out that it has no such power or competence. In that case, the enactment is called ‘Colourable legislation’. It happens in cases where either the Central or State Legislature purports to make laws on the subject matter mentioned in its list (i.e. either Union or State List); make law on the subject matter mentioned in another’s list.

In Narayan Deo V/s. State of Orissa[35]

Facts: – The state government of Orissa had passed an Act, “The Orissa Estates Abolition Act”, by which it imposed a tax on agricultural income. The real object of the Act was to lower the valuation of estates and to compensate the agriculturists (on property acquired by the Government) at a very low rate. The validity of the said Act was challenged on the ground of constitutional ultra-vires, and the State Government had no power to impose a tax on agricultural income.

Held: – Supreme Court admitted the petitioner’s contentions and quashed the concerned Act. It further observed that imposing a tax on agricultural income is within the competency of the parliament and is included in the Union list; therefore, the Act was colourable legislation.

i) Non-Observance of natural justice[36]:-

Violating the principles of natural justice makes the exercise of power ultra vires and void.

ii) Unreasonableness[37]:-

A discretionary power conferred on authority shall be exercised reasonably. The term ‘unreasonable’ is ambiguous and may include many things, e.g. irrelevant, extraneous considerations, improper purpose, malafide, the colourable exercise of power by authority etc.

In Roberts V/s. Hopwood[38]

Facts: – The local authority fixed the wages of four Pounds per worker per week during 1921-22. However, it was not quite sufficient to meet the entire family’s expenditure on the worker.

Held: – Court held that the rate fixed by the authority was unreasonable.

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[1] प्रषासकीय कृतीचे न्यायिक पुनर्विलोकन [प्रशासनिक कार्रवाई की न्यायिक समीक्षा]

[2] i.e. the State function of which is merely to maintain internal law and order and to protect its citizens from external aggression.

[3] परिणामस्वरुप [नतीजतन]

[4] अर्थ लावणे [व्याख्या करना]

[5] प्रषासकीय स्वेच्छाधिकाराचा/विषेश अधिकारांचा अर्थ [प्रशासनिक विवेक/विशेष शक्तियों का अर्थ]

[6] न्यायिक पुनर्विलोकनाची गरज [न्यायिक समीक्षा की आवश्यकता]

[7] न्यायिक पुनर्विलोकन [न्यायिक समीक्षा]

[8] घटनाबाहय आणि अंमलबजावणी करता न येणारा [असंवैधानिक और जिस पर अमल न किया जा सके]

[9][AIR 2002 SC 834], In small V/s. Moss (1938) Supreme Court of United States observed that “into the field of administrative discretion, the courts may not enter”.

In Westminster Corp. V/s. London & North Western Railway Co.(1905)

Lord Halsbury observed: – “Where the legislature has conferred the power to a particular administrative body with discretion, how it is to be used. It is beyond the power of any court to contest that discretion.

[10] न्यायिक पुनर्विलोकनाचे आधार न्यायिक समीक्षा के आधार []

[11] स्वेच्छाधिन अधिकार वापरण्यात अपयष विवेकाधीन शक्ति का प्रयोग करने में विफलता []

[12] पुन्हा सुपूर्द करणे/अधिकारांचे हस्तांतरण अधिकारों का पुनर्निर्धारण/हस्तांतरण []

[13] i.e. (1948)1 Aller. 780

[14] The main Act permitting delegation

[15] स्वेच्छा अधिकारावर स्वतः निर्बंध लादणे [विवेकाधीन शक्ति पर स्व-लगाए गए प्रतिबंध]

[16] i.e. ZLR (1907)27 Bom 307

[17] वरिष्ठांच्या हुकूमानुसार काम करणे [उच्चाधिकारियों के आदेशानुसार कार्य करना]i.e. In Commissioner Of Police V/s. Gordhandas, (AIR 1952 SC 16)

Facts:-Under the Act the Commissioner of Police, granted license for the construction of a cinema theatre. But later on, he cancelled it at the direction of the State Government.

Held:- the Supreme Court set aside the order of cancellation of license as the Commissioner had acted merely under dictation of the Government.

[18] स्वतःच्या बुद्धीचा वापर न करणे [अपनी बुद्धि का उपयोग नहीं करनं]

i.e. In Emperor V/s. Sibnath Banerji (AIR 1945 SC 156)

Facts :- An order of preventive detention had been issued in a routine manner by the Home Secretary, on the recommendation of police authorities without applying his mind and without satisfying himself whether preventive detention is necessary or not.

Held: – The Court quashed an order of preventive detention on the ground of non-application of mind by Home Secretary

[19] अधिकार व कर्तव्य एकत्र असणे [अधिकार और कर्तव्य एक साथ ]

[20] i.e. (1880) ‘5 AC 214’

[21] By Bishop on his own

[22] स्वेच्छाधिकाराचा गैरवापर किंवा अतिरेक [स्वेच्छाधिकार का दुरुपयोग या अतिरेक]

[23] अधिकार नसणे [अधिकार का अभाव]

[24] i.e. R. V/s. Minister of Transport (1934)1 K.B. 277

Facts:-The Minister revoked the licence; even through he had no power to do so.

Held: – The action was ultra vires and without jurisdiction.

[25] अधिकाराचा अतिरेकी वापर [सत्ता का दुरुपयोग]

[26] असंबंध वाबींचा विचार करणे [असंबंधित मुद्दों पर विचार करना]

i.e. In Ram Manohar Lohia V/s. State of Bihar (AIR 1966 SC 740)

Facts: – Dr. Ram manohar Lohia was detained under the defence of India rules, 1962, to prevent him from acting in a manner prejudicial to the maintenance of “law and order”, the rules were provided for detention to prevent subversion of “Public Order’.

Supreme Court held that:-the maintenance of “law and order” was wider than subversion of “Public Order” therefore, it was an irrelevant consideration.

[27] संबंधित बाबींचा विचार न करणे [प्रासंगिक मामलों पर विचार नहीं करना]

i.e. In Rampur Distillery V/s. Company Law Board (AIR 1970 SC 1789)

Facts:- The Company Law Board refused to give its approval for renewing the managing agency (i.e. Board of Directors)of the company. The reason given by the board for not giving its approval was that ‘previous dealings’ of the managing Director, i.e. Mr. Dalmiya were not good.

Supreme Court held that: – The Company Law Board should also have taken into consideration the present dealings of the managing director i.e. Mr. Dalmiya, which was good.

[28] संमिश्र बाबी [मिश्रित बातें]

[29] i.e. AIR 1963 Supreme Court 779

[30] वाईट हेतू [बुरे इरादे]

[31] i.e. AIR 1964 AC 962

[32] अयोग्य उद्देष [अनुचित उद्देश्य]

i.e. In Nalini Mohan V/s. District Magistrate (AIR 1951 Cal. 346)

Facts: – The administrative authority was empowered to rehabilitate and help the persons, who came from Pakistan due to partition of India, and to the persons suffered from communal violence occurred at that time but the authority ordered financial help to a person came from Pakistan on medical leave.

Held: – The order was set aside on ground of improper object

[33] दिखाव्या खाली अधिकाराचा गैरवापर [बहाने के तहत सत्ता का दुरुपयोग]

[34] वरकरणी [दिखावा]

[35]I.e. AIR 1953 Supreme Court 37.

[36] निसर्ग न्यायाचं पालन न करणे [नैसर्गिक न्याय का पालन नहीं करना]

[37] अयोग्यपणा [अनुपयुक्तता]

[38] (1925) AC 578

In Rohtas Industries Ltd. V/s. S.D. Agrawal (AIR 1969 SC707)

Facts: – Central Government issued an order of investigation against the petitioner company. The government had not sufficient evidence to order to hold investigation.

Held: – Supreme Court set aside the order on ground of unreasonableness