RAM MANOHAR LOHIYA

NATIONAL LAW UNIVERSITY

2017-2018
Final DRAFT ON: JUDICIAL REVIEW of
ADMINISTRATIVE DISCRETION

SUBMITTED TO: submitted by:

Dr. Aparna singh sriya sonkar
Asst.professor section ‘b’
Rmlnlu roll no.148
Vth semester

Enrollment no. 150101144

ACKNOWLEDGEMENT

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It feels great pleasure in submitting this project to Dr. Aparna Singh, Asst. Professor (Law),
Dr. RMLNLU, without whose guidance this project would not have been completed
successfully.

Next, I would like to sincerely thank my seniors, whose suggestions and guidance
assisted me throughout the entire tenure of making the project.

Last but not the least, I would like to express my heartfelt gratitude towards my
parents and friends who guided me and helped me at every possible step.

Sriya Sonkar

Vth Semester

CONCEPT OF JUDICIAL REVIEW

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The power of judiciary to review and determine the validity of a law or an order may be
described as the powers of Judicial Review’.

It means that the constitution is the supreme law of the land and any law inconsistent
therewith is void through judicial review.

It is the power exerted by the courts of a country to examine the actions of the legislatures,
executive and administrative arms of government and to ensure that such actions conform to
the provisions of the nation’s Constitution. Judicial review has two important functions, like,
of legitimizing government action and the protection of constitution against any undue
encroachment by the government.

Extensive Concept of Judicial Review in India:

The Supreme Court has been vested with the power of judicial review. It means that the
Supreme Court may review its own Judgement order. Judicial review can be defined as the
competence of a court of law to declare the constitutionality or otherwise of a legislative
enactment.

Being the guardian of the Fundamental Rights and arbiter of the constitutional conflicts
between the Union and the States with respect to the division of powers between them, the
Supreme Court enjoys the competence to exercise the power of reviewing legislative
enactments both of Parliament and the State’s legislatures.

The power of the court to declare legislative enactments invalid is expressively provided by
the Constitution under Article 13, which declares that every law in force, or every future law
inconsistent with or in derogation of the Fundamental Rights, shall be void. Other Articles of
the Constitution (131-136) have also expressively vested in the Supreme Court the power of
reviewing legislative enactments of the Union and the States.

Judicial review is the soul of our constitution. It is the exercise of the court’s inherent power
to resolve whether an action is lawful or not. ‘It holds the balance of power between
individuals and the government. It legitimizes the application of administrative sanctions.’

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In India, judicial review has a firm base. The framers of our constitution had not only
believed in limited government was necessary for democracy but also enshrined the
philosophy in the constitution. It is a modus operandi for public accountability of the
administrative process. In this process, it principally manoeuvres as a check upon the
administrative branch of the government and the agencies operating, there under. ‘According
to Schwartz, the basic remedy against illegal administrative actions is the judicial review. A
person aggrieved by an agency decision or other act may challenge its illegality in the
courts.’  Without, judicial review, administrative action and discretion would be limited only
by agency, self-discipline, executive direction, or legislative and public pressure. Thus this
control acts as a limitation on nasty abuses of power.

Courts in India are the guardians of our constitution. From time immemorial, they have
believed that executive and legislative powers which are immune from judicial scrutiny are
in a way repudiation of rule of law. Therefore for the purpose of doing justice and to protect
the Rule of Law, they through their various pronouncements, have build up an assortment of
formulations to control the exercise of administrative discretion. After clubbing these
formulations, we can summarize the judicial control at the stage of exercise of discretion by
the administrative authorities into two things:

1. That the authority is deemed not to have exercised its discretion at all.
2. That the authority has not exercised its discretion properly.

Judicial review in India comprises of three aspects:

(1) Judicial review of legislative action,
(2) Judicial review of administrative action,
(3) Judicial review of judicial decisions.

Thus, judicial review is a highly complex and developing subject. It has its roots long back
and its scope and extent varies from case to case. It is considered to be the basic feature of
the Constitution. The court in its exercise of its power of judicial review would zealously
guard the human rights, fundamental rights and the citizens’ rights of life and liberty as also
many non-statutory powers of governmental bodies as regards their control over property
and assets of various kinds, which could be expended on building, hospitals, roads and the
like, or overseas aid, or compensating victims of crime.

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The limits on the power of judicial review is a recurring theme in the evolution of our
Constitution. In some of its distinguished judgments, the Supreme Court has defined the
outline of sovereign power as distributed amongst the three branches of Government namely,
the legislature, the executive and the judiciary.

There is a compelling case that the power of judicial review delegated to our superior courts
in various provisions of the Constitution itself is as much by the command of the people. But
people who are in favour of this view argues that judicial inquiry of the validity of legislation
is a necessary protection against the oppression of majorities, that the judges do not check the
people, the Constitution does and since the Constitution itself is popularly ratified, there is
nothing undemocratic in the power of judicial review.

The decision of the Honourable Supreme Court of India in Kesavananda Bharti’s

case marked and explained the term which is called ‘basic structure’ to measure whether the
Parliament is seeking to destroy the Constitution, by using its powers under art. 368, which
was so far, understood to be a power, the exercise of which was not subject to judicial
scrutiny. Basic Structure is not contained in one or more provisions of the Constitution of
India, but it is supposed to be the sum total of the core of our Constitution.

Also in the same case the honourable court has interpreted the scope and meaning of judicial
review. “...The power of judicial review is, however, confined not merely to deciding
whether in making the impugned laws the Central or state legislatures have acted within the
four corners of the legislative lists earmarked for them; the courts also deal with the question
as to whether the laws are made in conformity with and not in violation of the other
provisions of the Constitution....

As long as some fundamental rights exist and are a part of the Constitution, the power of
judicial review has also to be exercised with a view to see that the guarantees afforded by
those rights are not contravened.... review has thus become an integral part of our
constitutional system and a power has been vested in the high courts and the Supreme Court
to decide about the constitutional validity of provisions of statutes. If the provisions of the
statute are found to be violative of any Art. Of the Constitution, which is the touchstone for
the validity of all laws, the Supreme Court and the high courts are empowered to strike down

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the said provisions.”

In Minerva Mills vs. Union of India, it was observed by the Supreme Court that the clauses
of art. 31-C as introduced by the Constitution (42nd Amendment) Act, 1976, which required
to take away the power of judicial review were unconstitutional. However, judicial review
was not held to be part of the basic structure of the Constitution by the majority in this
decision, although Bhagwati J in his minority decision traced the power of judicial review to
Arts. 32 and 226 and observed it to be a part of the basic structure of the Constitution, and if
taken away by a constitutional amendment would amount to ‘subversion of the Constitution’.

Failure To Exercise Discretion

‘The courts exercise judicial control if the administrative authority has either resigned from
using its power or has put restrictions on its implementations of the discretion or the
jurisdictional facts are either absent or have been erroneously concluded.’ 

 In Indian Railway Construction Co. Ltd. v. Ajay Kumar the law has been made crystal clear.
In this case the Supreme Court held that in general, discretion must be exercised only be the
authority to which it is committed. The authority must genuinely address itself to the matter
before it; it must not act under the dictates of another body or disable itself from exercising
discretion in each individual case. In the purported exercise of discretion, it must not do what
it has been forbidden to do, nor must it do what it has not been authorized to do. Judiciary
can compel the administrative authority to exercise the discretion but cannot make them
exercise it in a particular way. There would be very few situations which would be discussed
where there is an occurrence of failure to exercise discretion. The following chapter has been
divided into two sections:

• Surrender, abdication or dictation of discretion- In Purtabpore Co. Ltd. V. Cane Commr. Of

Bihar the Cane Commissioner had the discretion to hold back sugarcane quarters for the
individual sugar factories. But instead of using the discretion by own will, he acted upon the
dictates of the Chief Minister. The commissioner excluded 99 villages from the area held in
reserve by him in favour of the appellant-company previously. The two judge bench of the
Supreme Court quashed the exercise of discretion by the Cane Commissioner on the ground
that he abdicated his power by exercising it at the dictation of C.M. Therefore, it was deemed

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that the authority had not exercised its discretion at all. Thus, such so-called exercise of
discretion amounted to a failure to exercise discretion by the authority.

• Fettering of discretion- In Shri Rama Sugar Industries Ltd. v. State of Andhra Pradesh, Sec-
21 of the Andhra Pradesh Sugarcane (Regulation, Supply and Purchase) Act, 1961 gave
discretion to the administrative authority to excuse any new factory from payment of tax.
The government framed a new policy granting exemption only to those factories in the co-
operative sector. The Supreme Court, held that the adoption of this policy has fettered the
exercise of discretion and said that an authority bestowed with such statutory discretion may
justifiably implement general rules or principles to channel itself in the exercise of its
discretion provided such rules are not arbitrary and not opposed to the objectives of the Act.
The court in addition said that by adopting such rules, the agency must not stop itself from
exercising authentic discretion in individual cases.

Authority Has Exercised Discretion Improperly

Indian courts have shown that they are pretty eager to examine the factual basis on which the
administrative authorities have exercised their discretion. Furthermore, whether the
discretion has been exercised in an unreasonable manner or absolutely in defiance of logic
and morality, the court to use the Wednesbury Test of reasonableness and see whether the
discretion has been outrageously used, so much that it paved way for arbitrariness. The test
suggests that the discretion can be nullified if there is a manifested error in the exercise of
such power or the exercise of such power is manifestly arbitrary or mala fide or
unreasonable. The decision could be from numerous choices open to the authority, to
exercise its choice; the court would not surrogate its view. The court would infact strive to
ensure its mala fide use.

Unreasonable exercise of discretion or violation of Wednesbury Principle: In SR

Venkataraman v. Union of India, the appellant, a Central Government Officer was retired
prematurely from his service in ‘public interest’ on attaining 50 years of age. According to
her there was non-application of mind on the part of the government. Her service record was
made bad by giving adverse remarks by the chairman and that in the facts and circumstances
of the case the discretion vested under Rule 56(j) (i) was not exercised for furtherance of
pubic interest but on extraneous circumstances. The government conceded that there was
nothing on record to justify the order. The Supreme Court said that an administrative order

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which is based on reasons of fact which do not exist must therefore be held to be infected
with an abuse of power.

Malafide Exercise of Power: In G. Sadanandan v. State of Kerala, the Supreme Court held
that a mala fide exercise of discretion is nothing but abuse of power. In this case, the
petitioner challenged his detention order by the government on the ground of mala fide
exercise of discretion. The facts presented in court showed that a fake report against the
petitioner who was a wholesaler dealer in kerosene was made by the Deputy Superintendent
of Police (Civil Supplies Cell). He was actually a relative of his competitor therefore in order
to benefit his relatives in the same trade; a plot was hatched to eliminate the petitioner from
the trade. Moreover no counter-affidavit from the side of the government was filed thus, the
court quashed the order declaring improper use of discretion.

Irrelevant Considerations: In Barium Chemicals v. Company Law Board , the court was of
opinion that if it is claimed that the conditions do not exist or that they are such that is not
viable for anyone to form an opinion there from then such opinion is challengeable on the
ground of non-application of mind or perversity or on the ground that it was formed on
collateral grounds and was beyond the scope of the statute. In this case, a board was
instituted under sec-237 of the Companies Act, 1956 which is authorized to investigate only
if in its opinion the company is trying to defraud the creditors or members, etc. but here it
conducted the enquiry on the basis of faulty management of the company which resulted in
heavy downfall of the share prices. Therefore, the court by quashing the order, said that
executive by merely declaring an opinion does not mean that the order would not be
scrutinized.

Relevant Factors disregarded: In Rampur Distillery and Chemical Co. Ltd. v. Company Law
Board, the Supreme Court affirming the decision of the lower Court held that since the board
has based its decision solely on the past conduct without considering subsequent conduct and
activities of the person which are relevant factors, its decision was wrong. Sometimes an
order may be based partly on relevant and partly on irrelevant considerations. In such
situations the Courts would try and find out the true purpose for which the power was
exercised. After due consideration, the Court comes to the conclusion that the purpose of the
exercise was improper, it would be irrelevant that incidentally a genuine purpose is also
served. This would depend on the facts and circumstances of each case. Therefore, ‘where a
matter is to be decided by the authority solely on the basis of its subjective satisfaction, it

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must be properly based on relevant considerations only and not a mix of both as it would be
very difficult for the court to decide as to how much the irrelevant consideration played a
role in deciding on a particular course of action.’

Mixed motives /colourable exercise of discretion: In Jiwani Kumar v. First Land Acquisition
Collector , where the government could acquire property for a public purpose only
temporarily, and the land was acquired permanently, the court held it to be a colourable
exercise of power.

Subjective Satisfaction: ‘The court said that administrative authority’s decision could be one
of many choices but it is for the authority to make choice. Court cannot substitute its choice;
no matter a little play in the joints is certainly possible while dealing with the subjective
satisfaction.’ In Shalini Soni v. Union of India the Supreme Court observed that 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."

Arbitrary exercise of discretion- In R.D. Shetty v. International Airport Authority of India,

the issue was regarding awarding of a contract for running a second-class restaurant and two
snack bars by the International Airport Authority, which is a statutory corporation. The right
of selection and rejection was with the Airport Director who accepted the tender from a non-
hotelier. The petitioner in this case was neither an hotelier nor tenderer. His claim was that
both the tendered were in the same position as if a necessary condition i.e., only registered
hoteliers can send tender, can be forgone then why not petitioner’s. The Supreme Court
upheld the Locus Standi and Jus. Bhagwati said that every action of the Executive
Government must be informed with reason and should be free from arbitrariness. That is the
very essence of the rule of law and its bare minimal requirement.

However, in all these cases the burden of prove lies on the petitioner and whereas the
administrative authorities’ duty would be to show that discretionary power granted was
exercised in advance for the purpose which the power was granted in the first place.

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JUDICIAL REVIEW AND ADMINISTRTAIVE DISRETION IN INDIA
The courts in India have always held the view that judge-proof discretion is a negation of the
rule of law. Therefore, they have developed various formulations to control the exercise of
administrative discretion. These formulations may be conveniently grouped into two broad
generalizations

(i) That the authority is deemed not to have exercised its discretion at all.

(ii) That the authority has not exercised its discretion properly.

(iii) That the authority is deemed not to have exercised its discretion at all : Under this
categorization the courts exercise judicial control over administrative discretion if the
authority has either abdicated it power or has put fetters on its exercise or the jurisdictional
facts are either non- extent or have been wrongly determined.

LEADING CASE STUDIES :

1. Purtabpore Company Ltd. v. Cane Commissioner of Bihar (1969):

In this case the Cane Commissioner who had the power to reserve sugarcane areas for the
sugar factories, at the dictation of the Chief Minister excluded 99 villages from the area
reserved by him in favour of the appellant company. The Court quashed the exercise of
discretion by the Cane Commissioner on the ground that he abdicated his power by
exercising it at the dictation of some other authority; therefore, it was deemed that the
authority had not exercised its discretion at all.

2. In Sri Rama Sagar Industries Ltd. v. State of A.P. (1974), Section 21 of the A.P.
Sugarcane (Regulation, Supply and Purchase) Act, 1961 gave power to the
administrative authority to exempt from payment of tax any new factory which has
substantially expanded.

The government framed a policy granting exemption only to factories in the cooperative
sector. The Supreme Court, negotiating the contention that the adoption of this policy has

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fettered the exercise of discretion, held that a body endowed with a statutory discretion may
legitimately adopt general rules or principles of guide itself in the exercise of its discretion
provided such rules are not arbitrary and not opposed to the aims and objectives of the Act.
The court further remarked that by adopting such scales the agency must not disable itself
from exercising genuine discretion in individual cases. Justice Mathew and Justice Bhagwati
however, gave a dissenting opinion on the ground that the adoption of policy, as has been
done in this case, predetermines the issue.

This is an all embracing formulation development by the courts in India to control the
exercise of discretion by the administrative authority. In proper exercise of discretion
includes everything which English courts include in ‘unreasonable’ exercise of discretion
and American courts include in ‘arbitrary and capricious’ exercise of discretion.

Improper exercise of discretion includes such things as ‘taking irrelevant considerations into
account’, acting for in bad faith, ‘neglecting to take into consideration relevant factors’ or
‘acting unreasonably’.

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 CONCLUSION

If anyone says that can we do away with administrative discretion then the answer is that it is
impossible. It is a price or collateral that we keep for getting governed in a better way. There
are numerous merits of administrative discretion. Firstly, they are very well acquainted with
the ground work of the issue. Therefore with this efficient knowledge comparatively, a better
outcome can be achieved. Secondly, to get the speedy and effective resolution of the dispute,
it is the easiest way to get it. Thirdly, to get effective results, the authority has to be
sanctioned with enough discretion then only this tortuous evil would turn into an instrument
of success in governance. Therefore, the utility of having such discretion is relatively
beneficial for the country.

But what if there is no judicial control at all over this discretionary power? The citizens
would be left without remedy if anything happens. Normally, it is suggested that while
granting discretionary powers to administrative authorities, there should be a broad
framework laid down by the legislature following which the administrative authorities would
disseminate their obligatory duties. But, even after that we would find various gaps being left
by the legislature; it is here that the courts play their most important role. They check that
these gaps don’t allow the administrative authorities to abuse the power.

The court while examining their right use of discretion would have to be very careful as it is
strictly prohibited to go into the merits of each case. It is however, allowed to look into the
manner in which the power was exercised. Practically, it is impossible for the courts to check
the manner of the exercise of powers without going into the merits of the case. A judge in
India has to decide a case "on the merits" when he/she bases the judgment on the elementary
issues and considers technical and procedural defences as either unimportant or overcome.
Moreover, in India the jurisprudence follows that courts are not supposed to substitute their
own decision with administrative discretion. The courts in such cases make sure that the
administrative discretion is exercised, that to properly exercised. No individual’s
fundamental rights can be breached, not by any another individual nor even by the state.
Courts have very sternly believed in this theory and thus has successfully it put into work.

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A worth mentioning example is of the 14th March Nandigram incident where a Division
Bench of the High Court comprising of Honourable Chief Justice S S Nijjar and Honourable
Justice Pinaki Chandra Ghosh, suo moto initiated the case after about 10 PILs were filed in
the same regard. Apart from directing the CBI to submit the investigation report within a
month, a compensation scheme was also created for those who were killed, injured, raped
and molested. Both the revered judges commented:

" it seems as if the Police Department which is under the control of the Home Department is
not even aware of the existence of Article 21 of the Constitution of India…..This Article
specifically guarantees that ‘no person shall be deprived of his life or personal liberty except
according to procedure established by law.’ Oblivious of the aforesaid guarantee, the police
have resorted to gun firing on a large crowd protesting against the proposal to acquire their
land." There was a total absence of rule of law in west Bengal during this period.

To conclude, in reality, Indian courts’ job is hard as they have to be very careful that the
main idea behind the grant of this discretionary power is maintained and put to task on an
account of any failure, with the same time it also has to be cautious that the fact that they
don’t overwork their judicial discretion.

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