Administrative-law_afzal.docx

DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW

TOPIC: ADMINISTRATIVE DISCRETION: AN OVERVIEW OF INDIAN CONDITIONS

Project submitted for the partial fulfilment of B.A.LLB (Hons.) 5th semester course in Administrative Law-I.

SUBMITTED TO: Dr. R.K. Yadav Associate Professor (Law)

SUBMITTED BY: Afzal Mohhamad Roll No. 11 Section A

LIST OF CASES 1. Associated Provinial Pictes Ltd v Wednesbury Corpn (1948) 1 KB 223 2. AP Bankers & Pawn Brokers’ Association v Municipal Corporation of Hyderabad (2001) 3 SCC 646. 3. Ashwani Kumar v Bihar (1997) 2 SCC 1 4. Asif Hameed v Jammu and Kashmir AIR 1989 SC1899. 5. Associated Provincial Picture Houses v Wednusbury Corp [1947] 1 All ER 498. 6. Ayya v Uttar Pradesh (1989) 1 SCC 374. 7. AP Agarwal v Delhi (2000) 1 SCC 600 8. AK Roy v India, AIR 1982 SC710. 9. British Machinery Supplies Co v India (1993) Supp 2 SCC 76. 10. Bihar Public Service Commission v Manoj Kumar Pandey (1996) 11 SCC 664. 11. BS Minhas v Indian Statistical Institute (1983) 4 SCC 582. 12. Bansal v Rajasthan AIR 2003 SC405. 13. Barium Chemicals Ltd v Company Law Board AIR 1967 SC295. 14. Balaji Raghawan v India (1996) 1 SCC 361. 15. Chitta Ranjan Mishra v Utkal University AIR 2001 Ori 17 16. Constable Davinder Singh v Haryana (1996) 1 SCC 153. 17. Common Cause of India (1996) 6 SCC 530. 18. Dental College Council of India v Subhari KKB Charitable Trust AIR 2001 SC2151. 19. Gurbachan Singh v Bombay AIR 1952 SC221. 20. Hochtief Gammon v Orissa AIR 1975 SC2226. 21. Haryana v PC Wadhwa (1987) 2 SCC 602. 22. India v Association for Democratic Reforms (2002) 5 SCC 294. 23. India v G Ganayutham (1997) 7 SCC 463. 24. Indian Nut Products v India (1994) 4 SCC 215. 25. India v KV Jankiraman AIR 1991 SC2010. 26. India v Hindustan Development Corpn (1993) 1 SCC 467. 27. India v Shatabdi Training and Investment Pvt Ltd (2001) 2 SCC 604. 28. JP Ravidas v NHUMU Industril Coop Hsg Societ Ltd (1996) 9 SCC 300. 29. Jaisinghavi v India AIR 1967 SC1427. 30. Kuljeet Singh v Lt Governor, Delhi AIR 1981 SC2239. 31. Liversidge v Anderson[1942] AC 206. 32. Minerva Mills v India AIR 1980 SC1789. 33. M/s Chirag Enterprises v State AIR 1981 Raj. 170. 34. Mohd Zafer v India (1994) Supp 2 SCC 1 35. Mansukhlal Vithaldas Chauhan v Gujarat (1997) 7 SC622. 36. M/S Malik Medical Hall v India AIR 1975 Raj. 108. 37. Mohan Wahi v Commissioner, Income Tax, Varanasi (2001) 4 SCC 362. 38. Mela Ram v State AIR 1984 Raj 116. 39. Marathawada University v Seshrao Balwant Rao Chavan (1989) 3 SCC 132 40. M/S Indian Metals and Ferro Alloys Ltd v Orissa AIR 1987 SC1727. 41. Nakhuda Ali v Jayratne[1951] AC 66. 42. Nagendra Rao & Co v Andhra Pradesh AIR 1994 SC2663. 2

DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63.

NT Devin Katti v Karnataka Public Service Commission (1990) 3 SCC 157. Paramijit Singh v Ram Rakha (1979) 3 SCC 478. Punjab Communications Ltd v India (1999) 4 SCC 727. Principal, Cambridge School v Payal Gupta AIR 1996 SC118. Punjab v Gurdial Singh (1980) 2 SCC 471 Pratap Singh v Punjab AIR 196 SC72. PB Samant v Maharashtra LXXXIV Bom LR 427. Punjab v VK Khanna (2001) 2 SCC 330. Probodh Sagar v Punjab State Electity Board (2000) 5 SCC 630. Phoolchand Narendra Kumar v Madhya Pradesh AIR 1970 MP 70. PN Duda v P Shiv Shankar (1988) 3 SCC 131. Puttakamaiah v Karnataka AIR 1990 Kant 79. Ram Javaya v Punjab AIR 1955 SC549. Raj Kumar Karanwal v Commissioner AIR 1997 SC(Supp) 1792 Rohtas Industries v SD Agarwal AIR 1969 SC707 Rajasthan v India AIR 1977 C 1361. Shri Ram Sugar Industries Ltd v Andhra Pradesh(1974) 1 SCC 534. Sandeep Barar v Punjab AIR 1993 SC1313. Sikkim v DorjeeTshering Bhutia (1991) 4 SCC 243. Secretary, Indian Tea Association v Ajit Kumar Barat (2000) 3 SCC 93. Shripatrao v State AIR 1979 Bom 22

TABLE OF CONTENT 3

DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

1. Chapter I: Introduction 2. Chapter II: Needs and Justifications for Administrative Discretion 3. Chapter III: Scope of Administrative discretion 4. Chapter IV: Judicial restraint in interfering with administrative discretion 5. Chapter V: Control of abuse of administrative discretion a. Doctrine of Ultra Vires i. Executive power ii. Governmental Service iii. Preventive Detention, Externment and Regulatory Powers b. Power not exercised by proper authority c. Improper Exercise of Discretion d. Authority had not Applied its Mind e. Relevant considerations not examined f. Mala Fide Exercise of Power g. Arbitrary use of Discretion 6. Conclusion 7. Bibliography

CHAPTER I: INTRODUCTION 4

DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

A significant phenomenon of the present–day administrative process is conferment of discretionary powers on administrative personnel to take decisions from case to case. Since time immemorial civilizations and citizens had always desired and urged for the people who could lead them in various sphere of life which sublimes the importance of administration. At that era the need for administration began which gave birth to administrators, at that point of time state was considered as a “Police State” which now has became welfare state. No modern government however can function without the grant of discretionary power to administrative authorities. This laid the administrators with greater power and enhanced their discretionary limits. Professor Freund defined Administrative Discretion as “When we speak of administrative discretion, we mean that a determination may be reached, in part at least, upon the basis of consideration not entirely susceptible of proof or disproof…. It may be practically convenient to say that discretion includes the case in which the ascertainment of fact is legitimately left to administrative determination.” Coke proclaims “Administrative Discretion” as “it is a science or understanding to discern between falsity and truth, between right and wrong, between shadows and substance, between equity and colourable glosses and pretences, and not to do according to their will and private affection” Thus it can be said that decision taken by the administrative authorities are not only based on the evidence but in accordance to the policy and also in accordance to the discretionary power conferred on the authority. Administrative discretion is not a term provided by statutes, thus to understand it we separate the term, where ‘Administration’ in public law means, the practical management and direction of executive department and its agencies. Whereas ‘Discretion’ in this sense means choosing from amongst the various available alternatives but with reference to the rule of reason and justice and not according to personal whims. Discretionary powers conferred on the administration are of different type. They may range from simple ministerial function like maintenance of birth and death register to powers which seriously affect the rights of an individual, e.g. acquisition of property, regulation of trade,

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

industry or business, investigation, seizer, confiscation and destruction of property, detention of a person on subjective satisfaction of an executive authority and the like.

CHAPTER II: NEEDS AND JUSTIFICATIONS FOR ADMINISTRATIVE DISCRETION For the following reasons administrative discretion is given to the administrators of the country. 

The present day problems which the administration is called upon to deal with are of complex and varying nature and it is difficult to comprehend them all within the



Scope of general rules. Most of the problems are new, practically of the first impression. Lack of any



previous experience to deal with them does not warrant the adoption of general rules. It is not always possible to foresee each and every problem but when a problem arises it must in any case be solved by the administration in spite of the absence of specific rules applicable in the situation. Circumstances differ from case to case so that applying one rule mechanically to all



cases may itself result in injustice. For the following reasons administrative discretion should not be given from an individual’s point of view:

General rules usually avoid retroactivity and operates in future so that one has prior notice of the rules and thus may regulate his conduct accordingly, whereas case to case approach, the individual may be caught by surprise and may not be able to adjust his affairs in the absence of his ability to foresee future administrative action. The case to case approach involves the danger of discrimination amongst various



individuals, there arises a possibility of not getting like treatment under like circumstances. The process is time consuming and involves decision in a multiplicity of cases. Also



there is danger of abuse of discretion by administrative officials. The broader the discretion, the greater the chance of its abuse. In words of Justice Douglas of the U.S. SC: “Where discretion is absolute it is more destructive of freedom than any of man’s other invention.”1 1 United States v Wunderlick, 342 US 98, 101 (1951).

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

The Court of House of Lord in England had laid down the tests to be met for the exercise of administrative discretion in Wednesbury’s case2 and later on proportionality test which came in through doors of European Convention of Human Rights. Courts in India has also travelled the same path with the exception that proportionality test was a part of Indian law. The Court has extended Scopeof Judicial Review by virtually obliterating the distinction between “error of law” and “error apparent on face of law.”

CHAPTER III: SCOPE OF ADMINISTRATIVE DISCRETION The Scope of discretion is determined by construing the statutory provision that contain the grant of discretion. In Liversidge v Anderson3 Lord Atkin in his dissenting opinion said at it was the duty of Court to make sure that the home secretary acted on a reasonable cause. In Nakhuda Ali v Jayratne4 P.C. observed that the above decision would be applicable only in cases of emergency. In AK Gopalan v Madras, SC of India took the view that the detaining authority’s satisfaction that a person needed to be detained preventively not open to judicial review. It has now been established that the subjective satisfaction of the detaining authority must be based on relevant material, which a reasonable person would consider sufficient to lead to such satisfaction.5 In Shri Ram Sugar Industries Ltd v Andhra Pradesh6, Mathew J and Bhagwati J giving the minority opinion held that if government has been given the discretion, it could not fetter its discretion by laying down a general policy. In Nagendra Rao & Co v Andhra Pradesh7 it was held by the Court that while using the discretion purpose of discretion has to be seen by the officer and not the literal sense is to be construed. When the Act provided for confiscation of goods for serious offences of black marketing and adulteration, the same should not be equated to failure in putting up the price list.

CHAPTER IV: JUDICIAL RESTRAINT IN INTERFERING WITH ADMINISTRATIVE DISCRETION 2 Associated Provinial Pictes Ltd v Wednesbury Corpn (1948) 1 KB 223 3 [1942] AC 206. 4 [1951] AC 66. 5 AP Bankers & Pawn Brokers’ Association v Municipal Corporation of Hyderabad (2001) 3 SC 646. 6 (1974) 1 SC 534. 7 AIR 1994 SC2663.

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

A review Court is not supposed to substitute its own decision regarding a matter which has been entrusted to an administrative authority. They are concerned not with whether such decision is right but with whether such decision has been taken in right manner. Courts do not sit over the decision of an academic body like a university regarding revaluation of answer books8or of an expert like Dental Council to establish a dental college9 or of the income tax authority’s assessment that a property was valued at less than 15% the market value so as to attract the provision of compulsory purchase of such property.10 It was held that discretion arrest a person u/s 41 of CrPC 1973 could not be exercised mechanically. In recent years, Courts have made a distinction between the exercise of discretion, which involves policy making and discretion in its application to the individuals. In policy making, Courts tread more cautiously and are hesitant to interfere. In a case where price fixing was challenged, the SC refused to interfere, since the committee for fixation of such price has recommended the enhancement of price.11 Similarly, when the railway authorities adopted a dual pricing policy for charging tariff from bigger and smaller manufacturers, it was held not violative of art 14 of the Constitution. In the absence of allegations of mala fide exercise of power, Courts refused to interfere in that matter.12 The Court should not interfere with the criteria or the methodology unless they clearly violate any provision of Constitution.13

CHAPTER V: CONTROL OF ABUSE OF ADMINISTRATIVE DISCRETION DOCTRINE OF ULTRA VIRES The acts of executive belongs to two categories viz. (i) those performed under the executive power defined under the Constitution; and (ii) those performed under the powers given by statutes. Before considering whether as act of the executive is ultra vires, Courts have to determine the Scope of executive power.

a)

Executive power

8 Chitta Ranjan Mishra v Utkal University AIR 2001 Ori 17 9 Dental College Council of India v Subhari KKB Charitable Trust AIR 2001 SC2151. 10 India v Shatabdi Training and Investment Pvt Ltd (2001) 2 SC 604. 11 British Machinery Supplies Co v India (1993) Supp 2 SC 76. 12 India v Hindustan Development Corpn (1993) 1 SC 467. 13 Sandeep Barar v Punjab AIR 1993 SC1313.

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

The Constitution describes the executive power of the central government and the state government in arts. 73 and 162 respectively. According to art. 73 , the executive power of the Union extends to (i) all matters with respect to which the parliament/ legislature has power to make laws; and (ii) the exercise of such rights, authority and jurisdiction as are exercisable by the Government of India by virtue of any treaty or agreement. Article 162 provides that the executive power of the state extends to all matters with respect to which the legislature of the state has power to make laws. In Ram Javaya v Punjab14, Court clarified that ‘executive power’ included all powers that were neither legislative nor judicial. Unless and act impinges FR or other right created by statute, it can be provided by an executive action. Where the statutory provision becomes unworkable and inoperative for the time being due to some reasons, the executive power becomes operational.15 Where commissioner granted lease by accepting expired bids by efflux of time, the order was held to be ultra vires.16 Under sec. 10 IDA 1947 where government can make referral of the dispute to the adjudicating tribunal, HC can ask it to exercise its power but not the particular manner to exercise the power.17 The government decision is subject to judicial review and can be set aside if based on irrelevant considerations.18 Where the registrar was empowered to appoint administrator and if he appoints one without any necessity or when elected committee should have or could have administered, then order making such appointment is ultra vires the registrar’s powers19. The doctrine of ultra vires applies even to bodies registered under a statute, such as cooperative societies. Where land was allotted to the housing society by the government on concessional rate for the distribution among dalits and non dalits with a ratio of 80:20, allotting land to non dalits over 20% was held to be ultra vires.20 Appointment of persons is excess of sanctioned post was held to be void.21 b) Governmental Service A rule provided a specified period beyond which probation could not be extended, continuation of the probation beyond that period was invalid and the person was deemed to 14 AIR 1955 SC549. 15 Sikkim v DorjeeTshering Bhutia (1991) 4 SC 243. 16 Raj Kumar Karanwal v Commissioner AIR 1997 SC(Supp) 1792 17 Secretary, Indian Tea Association v Ajit Kumar Barat (2000) 3 SC 93. 18 Hochtief Gammon v Orissa AIR 1975 SC2226. 19 Shripatrao v State AIR 1979 Bom 22 20 JP Ravidas v NHUMU Industril Coop Hsg Societ Ltd (1996) 9 SC 300. 21 Ashwani Kumar v Bihar (1997) 2 SC 1

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

be confirmed.22 Denying the employing promotion even after he was exonerated in criminal proceedings was held to be ultra vires.23 Appointments must be made strictly in accordance with the rules of recruitment.24 Where application are invited for posts, specifying qualifications required in accordance with the then prevailing rules, selection must be made according to those rules. Subsequent amendments of such rules cannot govern such selection.25 c) Preventive Detention, Externment and Regulatory Powers The Bombay Police Act authorized two kinds of externments; (i) externment from Greater Bombay; (ii) externment from State of Bombay. Externment order to leave Greater Bombay and go to Amritsar was ultra vires, as state government can only ask externee to go out of the state of Bombay.26

Rule 30(1)(b) of the Defence of India Rules 1962 permits detention of a

person to prevent him from acting in a manner prejudicial to public order. An order issued authorizing detention on grounds of public safety and maintenance of law was held ultra vires as the words ‘law and order’ were of wider amplitude than the words ‘public order’ contained in the rules.27 In M/S Indian Metals and Ferro Alloys Ltd v Orissa 28 it as held that even though government has power to regulate the supply of electricity and to decide as a matter of policy whether the benefit of clubbing power allotted to different units should be allowed to consumers, such an order imposing restrictions on consumption cannot be imposed retrospectively. In medical college, candidates belonging to reserved category secured seats in gnarl category, the reserved quota could not be reduced when it had not resulted in excessive representation of the reserved category.29

POWER NOT EXERCISED BY PROPER AUTHORITY When legislature vests discretionary power in an authority, that authority alone must exercise such power, unless the statute conferring such powers permits its delegation. Where statute gives power to specific authority, the powers must be exercised by the specific authority and 22 Paramijit Singh v Ram Rakha (1979) 3 SC 478. 23 India v KV Jankiraman AIR 1991 SC2010. 24 SS Sodhi v Punjab (1990) 2 SC 694. 25 NT Devin Katti v Karnataka Public Service Commission (1990) 3 SC 157. 26 Gurbachan Singh v Bombay AIR 1952 SC221. 27 Victoria Fernandes v Lalmal Sawna (1992) 2 SC 97. 28 AIR 1987 SC1727. 29 Asif Hameed v Jammu and Kashmir AIR 1989 SC1899.

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

such powers cannot be delegated. Under the All India ES (Confidential Rolls) Rules 1970, head of the department was to write the confidential reports on the subordinate staff. It was held that confidential report of an Inspector General of Police could not be written by the Home Secretary of the state, it must be written by the minister. 30 In Marathawada University v Seshrao Balwant Rao Chavan,31 it was held that the executive committee cannot delegate power to the Vice Chancellor, as his power did not included power to take discipliary action against the employees, which only the executive council could do. An officer duly authorized to certify its orders’ means an officer authorized under the rules of business of the state government framed u/a 166 of the Constitution. Therefore, where the collector had no such authority, he could not make the declaration that a particular land was required to be acquired under the LAA.32 It is held that delegation of power did not amount to denudation of delegator’s own authority.33 Where a decree was sent by a Court to the deputy commissioner for execution u/s 54 of CPC 1988, it was held that the deputy commissioner could delegate that function to assistant commissioner but the assistant commissioner could not further delegate it to the tahsildar. The proceeding by the tahsildar was held to ultra vires.34 But where the body to which the power is delegated can form a committee to discharge the function as the body may be multimember and it is not feasible for every member to be associated with the decision making in respect of every matter.35

IMPROPER EXERCISE OF DISCRETION In Associated Provincial Picture Houses v Wednesbury Corp,36 it was held that the authority exercising direction must exclude from its determination matters that are irrelevant; and include matters that are relevant. Where discretion is given to an administrative authority, it is supposed to exercise it so as to further the public interest. It cannot be exercised unless and until the condition for its exercise are obtained. An authority, which acts on irrelevant considerations, assumes jurisdiction wrongly. 30 Haryana v PC Wadhwa (1987) 2 SC 602. 31 (1989) 3 SC 132 32 Mela Ram v State AIR 1984 Raj 116. 33 M/S Malik Medical Hall v India AIR 1975 Raj. 108. 34 Puttakamaiah v Karnataka AIR 1990 Kant 79. 35 Bihar Public Service Commission v Manoj Kumar Pandey (1996) 11 SC 664. 36 [1947] 1 All ER 498.

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

In Secretary of State for Education and Science v Tameside Metropolitan Borough Council,37 House of Lords held that statutory powers must be exercised in accordance with legal standard of reasonableness and, in spite of the words such as ‘if the Secretary of State is satisfied’, the actions would be valid only if they are such as a reasonable person might take on the basis of the material before him.

AUTHORITY HAD NOT APPLIED ITS MIND An authority, which orders preventive detention, has to be satisfied that the activities of the detenue are such to warrant detention. Satisfaction of the detaining authority must be based on material that has nexus with the activities of the detenue. Where preventive detention orders were made on the ground of disturbance of public order, but on facts the acts alleged did not seem to affect public order, such orders were held invalid on the ground that detaining authority had not applied its mind.38 Where u/s 321 of CrPC gives power to the public prosecutor to decide whether a prosecution deserves to be withdraw in the interest of the administration of justice and then the magistrate, surrendered their discretion, it was held that they had not applied their mind. 39 Where an auction sale was confirmed by the Tax Recovery Officer, where upon a notice u/s 156 of the I.T. Act 1961 was mandatory, setting aside of the auction sale by higher authority without following the statutory procedure was held to have been done without application of mind.40

RELEVANT CONSIDERATIONS NOT EXAMINED Where land sought to be acquired under the Kerala Cashew Factories (Acquisition) Act 197, it was held that the notice of acquisition must clearly indicate that the government was satisfied that all condition mentioned in clause (a), (b) and (c) of Subsection (1) of section 3 had been met. In the absence of such clear indication of the satisfaction regarding the fulfillment of those conditions, the decision to acquire land could not be said to have been taken on relevant considerations.41 In Rohtas Industries v SD Agarwal,42 an investigation ordered u/s 237 of the Companies Act was held to be bad on the ground that circumstances 37 [1977] AC 1014. 38 Ayya v Uttar Pradesh (1989) 1 SC 374. 39 Shrilekha Vidyarthi v Uttar Pradesh (1991) 1 SC 212. 40 Mohan Wahi v Commissioner, Income Tax, Varanasi (2001) 4 SC 362. 41 Indian Nut Products v India (1994) 4 SC 215. 42 AIR 1969 SC707

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

shown by the Company Law Board did not lead to the conclusion of fraud on the part of the company. The sanction issued an authority on the direction of the High Court was held to be vitiated by non-application of mind.43 The discretion vested in attorney general/solicitor general to grant permission to prosecute a person for contempt of Court was held to be justiciable. 44 Where municipal land lay vacant and the appellant applied for permission to use it as playground for children since it was adjacent to the appellant’s School, the dismissal of his application and the allotment of land to a musical concert was held toe based on irrelevant considerations. 45 Where renewal of a license was refused on the ground that could not be issued to two partnership firms having common partners, the decision of the collector was quashed being based on extraneous grounds for the requirements of the order.46

MALA FIDE EXERCISE OF POWER Where the actual purpose is different from that which is authorized by the law, and the discretionary power is used ostensibly for the authorized purpose, but in actuality for the unauthorized purpose, the power is supposedly exercised mala fide. In Westminister Corporation v London & North Western Railway,47 the House of Lords held that while exercising its power for legitimate purpose, if collaterally some other purpose, which is not illegal, could be served, the exercise power was not vitiated. Mala fide exercise of power is required to be proved by the person who alleges it.48 The mere fact that a person was appointed to a higher post superseding ten persons senior to him does not make out a case of mala fide exercise of power.49 Selection of large number of constables could not be held mala fide merely because one of the selected candidates was related to one of the selecting officers or because some of the candidate had worked with some VIPs as gunmen.50 A mere likelihood of bias is not sufficient to establish mala fide intentions on the part of such a person. When acquisition of a particular land was done under emergency powers by the government and it was found that the real intention was to take away the land of a particular person to 43 Mansukhlal Vithaldas Chauhan v Gujarat (1997) 7 SC622. 44 PN Duda v P Shiv Shankar (1988) 3 SC 131. 45 Sri Vidhya Mandir Education Society v Malleshwaran Sangeetha Sabha & Ors (1995) Supp 1 SC 26. 46 Phoolchand Narendra Kumar v Madhya Pradesh AIR 1970 MP 70. 47 [1905] AC 426 48 Probodh Sagar v Punjab State Electity Board (2000) 5 SC 630. 49 Punjab v VK Khanna (2001) 2 SC 330. 50 Constable Davinder Singh v Haryana (1996) 1 SC 153.

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

vent hostility of a local politician and x-minister, the acquisition was held to be mala fide. 51 In Pratap Singh v Punjab52 where leave of the employee was first granted and later revoked and he was suspended and an inquiry was instituted against him was held by the SCas being a method of wreak vengeance by chief minister. In PB Samant v Maharashtra53 where government has distributed cement, not in accordance with the law but in the favour of the builders in return for donations given by them to certain foundations of which the chief minister was a trustee, SC held it to be abuse of power. In another case where Petrol Pump were allotted to friends and relations of politicians or various officials in the Petroleum Ministry or to the sons of retired judges was held arbitrary. 54 In Shivsagar Tiwari v India,55 stalls and shops allotted by the minister to her own relatives, employees and family friends were annulled by the Court, as such allotments were made without following the tender system and entirely on nepotistic considerations.

ARBITRARY USE OF DISCRETION The absence of arbitrary power is first essential of the rule of law upon which our whole Constitutional system is based.56 The rule of law from this point of view means that decisions should be made by the application of known principles and rules and, in general, such decisions should be predictable and the citizen should know where he is. A decision is said to be arbitrary when it is based on mere whim or caprice or on purely subjective likes or dislikes or irrational beliefs. Arbitrariness means lack of objectivity. It also means lack of predictability. An action is arbitrary when no reasonable person could have acted in that manner. When a decision is taken without applying the mind or under somebody’s dictation or on irrelevant considerations or out of malice, it is arbitrary. In AP Agarwal v Delhi,57 the SC observes that where power is conferred with a discretion, ‘it is coupled with duty to shun arbitrariness in its exercise and to promote the object for which the power is conferred, which undoubtedly is public interest and not individual or private gain, whim or caprice of any individual’

51 Punjab v Gurdial Singh (1980) 2 SC 471 52 AIR 196 SC72. 53 LXXXIV Bom LR 427. 54 Common Cause of India (1996) 6 SC 530. 55 (1996) 6 SC 558. 56 Jaisinghavi v India AIR 1967 SC1427. 57 (2000) 1 SC 600

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

In order to avoid arbitrariness, any decision should be taken on pre-determined criteria and the decision-making authority should give reasons. The reasons must be relevant and related to the facts of the case. All the decisions that are vitiated by lack of relevant grounds or which are mala fide are also arbitrary. An action is arbitrary when the consideration on which it is based is not only irrelevant but also has no nexus with the objective for which discretion has been given. Where tenders are invited and conditions are set out in the notice for accepting tenders, acceptance of a tender, which does not fulfill the conditions, is an arbitrary act. Where tenders are invited, rejection of the lowest quotation without assigning any reason is arbitrary.58 In Tata Iron and Steel Co Ltd. V India,59 the SC held that the government was bound to consider the report of an expert committee, which contained recommendations regarding the grant of mining lease for chromite ore. Although government might not follow those recommendations, it must give reason for not doing so. Where a student had passed a public examination and had continued his studies in a higher class in the same School, it was held that the School could not refuse admission by applying a higher cut-off level of marks for such continuance.60 Under the Unlawful Activities (Prevention) Act 1967, the government can impose ban on an association if its activities are found to be objectionable as mentioned in the Act. The SC held in Mohd Zafer v India,61 that such a ban could be imposed only if there were grounds for doing so and those were communicated. The requirement of giving reasons as a concomitant of the right to information of the association concerned. Where the standing orders of Hindustan Steel Ltd nowhere obliged the general manager of the plant to record reasons for dispensing with an inquiry before dismissing an employee, the Court held that such a power to dispense with an inquiry without giving reasons was arbitrary.62 An administrative authority is bound to adhere to procedural standards fixed by the statute under which it has power to act. Non-compliance with procedural standards might make the action arbitrary.63 The requirement of giving reasons would sub-serve two purposes, (i) it would facilitate judicial review; and (ii) it would enable the person concerned to know why a 58 M/s Chirag Enterprises v State AIR 1981 Raj. 170. 59 AIR 1996 SC2462 60 Principal, Cambridge School v Payal Gupta AIR 1996 SC118. 61 (1994) Supp 2 SC 1 62 Workmen, Hindustan Steel Ltd v Hindustan Steel Ltd AIR 985 SC251. 63 BS Minhas v Indian Statistical Institute (1983) 4 SC 582.

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

decision was not taken in his favour. The requirement of giving reasons would minimize the chance of abuse of power.

CONCLUSION In every field, every sphere, each substance has to be in a reasonable format, by which it can serve and without which it can extinct. Wide discretion must be in all administrative activity but it should be discretion define in term which can be measured by legal standards lest cases of manifest injustice go unheeded and unpunished. Thus, there must be control on the discretionary power of administration by which law and justice could be up hold as we need ‘Government Laws and not Government of Men’. This would even be in public interest to; it is not to say that Administrative Discretion must be restrained by any of the organ of Government but a check and balance system must be organized, though this system is found by American courts. Thus, it is the need for Indian courts to develop as they lack activism of American courts. In India as like USA there is no Administrative Procedure Act providing for judicial review on the exercise of Administrative discretion. With the rapid growth of administrative law and the need and necessity to control possible abuse of discretionary power by various administrative authorities, certain principles have been evolved by courts. If an action taken by any authority is contrary to law, improper, unreasonable, or irrational, a court of law can interfere with such action by exercising power of Judicial Review. Thus, the orthodox approach of Indian courts that they have no power to interfere with the order passed by the administrative authority in exercise of discretionary power , must be kept aside and new way of dealing this limitation of Administrative Discretionary to be concentrated for growth and development of a country.

BIBLIOGRAPHY 1. BOOKS a. Administrative Law , S.P. Sathe, 7th Edition,2008, Lexis Nexis Butterworths b. Administrative Law, I.P. Massey, 7th Edition, 2009, Eastern Book Company c. Issues and Crisis Of Public Administration– Codes And Guidelines, Ranjan Kumar Ramani, 1st Edition, 2008, Cybertech Publication. 16

DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions

d. Principles Of Administrative Law, M.P Jain & S.N Jain, 6 th Enlarged Edition, 2007 Lexis Nexis Butterworths Wadhwa

2. ARTICLES a. “Limitations of Administrative Discretion”, Apurv Shah & Paras Parekh b. “Administrative Discretion & Limitation on Administrative Discretion by Article 14 &

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of

the

Indian

Constitution”

Shubham

Manoj

Khare,



3. WEBSITES REFERRED a. Last accessed: April 2nd 2013 b. Last accessed: April 2nd 2013 c. Last accessed: April 2nd 2013 d. last accessed: April 3rd 2013 e. Last accessed: April 3rd 2013 f. Last accessed: April 3rd 2013

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DR. RAM MANOHAR LOHIYA NATIONAL LAW UNIVERSITY, LUCKNOW | Administrative Discretion: An overview of Indian conditions