NATIONAL LAW INSTITUTE UNIVERSITY, BHOPAL

SYLLABUS

ADMINISTRATIVE LAW

AUGUST-NOV 2020
B.A.LL.B. ( Hons.)
Vii SEMester

COURSE teacher-
Dr. Sushma Sharma,
Associate Professor,
N.L.I.U, Bhopal

1. Objectives of the Course-

This course has the following objectives-
The students will learn about the key concepts and principles of administrative Law. The
students will be encouraged to think about how the administrative law can and should
address the governance issues.The students will read and analyse the meaning, nature and
scope of Administrative law and to understand difference between constitutional law and
administrative law and public administration.
The students will study about the growth and evolution of Administrative law. The
students will study about different definitions of Administrative law and red light and
green light and Amber light theory. To understand the concept of rule of law separation of
powers and droit administratif.
The students will study the technique of delegated legislation and to learn the various
methods of control over delegated legislation. The students will study about the
administrative adjudicatory functions and the procedure which is applied for
administrative decision making which are the principles of natural justice. The students
will learn about administrative law and its relation to different substantive legal fields like
constitutional law and public administration.
The students will study about administrative discretion, definitions and the kinds of it, to
describe various grounds to challenge the conferment and exercise of administrative
discretion. The students shall gain the knowledge of control mechanisms over
administrative actions. The course is also framed with the objective to explain the scope
and application of the three writ remedies; mandamus, prohibition and certiorari. The
students will learn the justification and advantages of mechanisms of administrative
justice, including tribunals.
2. Outcome of the Course
At the end of the course the students must be in a position to give the following outcome :-
The student will be able to identify the characteristics of Administrative law. The student will
be able to identify the reasons for the growth of Administrative law. The student will be in a
position to explain the different sources of Administrative law. The student will be able to
explain the relationship between constitutional law and administrative law. Students should
be in the position to write important definitions of Administrative law and to identify that that
definition is supporting the red light theory or green light theory.
The students should be in a position to explain the theory of separation of powers and rule of
law. The students will be able to explain the different kind of functions performed by
administrative bodies. Students will be in a position to differentiate between different kinds
of functions performed by administrative bodies. Students will be able to decide whether a
rule or regulation is constitutional law unconstitutional and otherwise is valid or not.
The students will be able to explain the different kinds of controls over delegated legislation.
The students will be able to explain the different kinds and classification of Administrative
tribunals. Students will be able to explain the concept of droit administratif of France. The
students will be able to explain the concept of ombudsman and the Lokpal and Lokayukt in
India. The students will be able to decide whether the violation of natural justice has
happened in a particular functioning of Administrative authorities or not.
The students will be able of explain the working of Public Corporation in India and the
Controls over them. Students will be able to understand and explain the law relating to
liability of government and the doctrines developed by the court to fix the accountability. The
students will be able to apply the principles of Administrative law the real life situations in
the administrative functioning.

3. Course Outline
UNIT-I
Introduction
1.1 Nature and Scope
1.2 Definitions of Administrative Law
1.3 Reasons for Growth
1.4 Sources
1.5 Comparison with Constitutional Law and Public Administration
1.6 Rule of law
1.7 Droit Administratif
1.8 Global Administrative Law

Unit –II
Classification of Functions
2.1 Separation of Powers
 2.2 Difficulty in Characterization of functions
2.3 Subordinate legislation( Rule Making Functions)
2.4 Quasi-Judicial Functions
2.5 Purely Administrative Functions
2.6 Difference between the different kind of functions

Unit-III
Subordinate Legislation and its Controls
3.1 Concept and Reasons for Growth
3.2. Advantages and disadvantages
3.3. Classification-Nomenclature based classification, authority based classification
(delegated legislation and sub delegation), purpose based classification, authority based
classification- ( subordinate legislation and conditional legislation)
3.4. Essential legislative functions, Constitutionality
3.5. Legislative controls
3.6 Executive Controls
3.7 Judicial control
Unit- IV

Administrative Discretion

4.1 Introduction, definition, meaning

4.2 Difference between different kinds of functions of administrative process
4.3 Ministerial and discretionary powers
4.4Legislative Control
4.5 Executive Control
4.6 Judicial Control

Unit-V

Administrative Tribunals

5.1. Need of Administrative Justice

5.2 Adoption of Droit Administratif, Franks Committee
5.3 Distinction between administrative tribunal, court and administrative authority.
5.4 Tribunals in India-Classification.
5.5 Tribunals under Indian Constitution, Central Administrative Tribunal
5.6 Inquiry Commissions

UNIT –VI
Principles of Natural Justice
6.1. Introduction
6.2 Right of hearing
6.3 Rule against bias
6.4 Speaking order
6.5 Exclusion of Natural Justice
6.6 Breach of Natural Justice -Effect

Unit –VII

Judicial Control of Administrative Actions

7.1Development of Judicial Review

7.2 Habeas Corpus
7.3Writ of Mandamus
7.4 Writ of Prohibition
7.5 Writ of Certiorari
7.6 Quo Warranto

Unit –VIII

Ombudsman

8.1.Concept of Ombudsman
8.2. Ombudsman in Scandinavian Countries
8.3.Ombudsman in Common Law Countries
8.4.Lokpal and Lokayukta Act 2013
8.5.Working of Lokpal
8.6 Ombudsman under other legislations, Banking Ombudsman, Insurance
Ombudsman

Unit IX

Public Corporations

9.1 Definitions, Object, Characteristics

9.2 Classification
9.3 Rights and Duties
9.4 Legislative Control
9.5 Executive Control
9.7Judicial Control

Unit X

Regulatory Authorities

10.1 Need and Origin

10.2 Nature and Functions
10.3 Growth of Regulatory Authorities in India
10.4 TRAI, IRDA, UGC, CCI, SEBI, FASSAI

 Book recommended for reading-

PRINCIPLES OF ADMINISTRATIVE LAW,

Authors-M.P. Jain and S.N. Jain
7th Edition ,2017
Nagpur: Lexis Nexis, Butterworth’s Wadhwa

UNIT-I
Introduction
1.1 Nature and Scope
1.2 Definitions of Administrative Law
1.3 Reasons for Growth
1.4 Sources
1.5 Comparison with Constitutional Law and Public Administration
1.6 Rule of law
1.7 Droit Administratif
1.8 Global Administrative Law

DEFINITION OF ADMINISTRATIVE LAW

We would begin by examining the nature of the words that comprise Administrative Law.
‘Administration’ as a concept is an adjective qualifying law. It suggests the act of managing
or executing the principles and practices of state functions governed by law. ‘Law’ in the
tripartite phrase ‘Public Administrative Law’ would refer to Rules and Regulations that are
stable, made by the Legislative, executed by the Executive arm or government, enforced by
the Judiciary in the regulation and conduct of public agents or government. It is a truism that
every society whether developing or developed, governs itself within the framework of
established rules and regulations. In managing government affairs, rules and regulations exist
which the term Administrative Law covers in the subject matter. Administrative law is in
itself in public domain. Like most concepts in the Humanities or social sciences, there is no
one universally acclaimed definition of Administrative Law. However, this course will
outline some well researched definitions espoused by informed writers on the subject.
Sir Ivor Jennings (1959) defines Administrative Law as: “the law relating to administration.
It determines the Organizations, powers and duties of administrative Authorities.”
According to Wade and Bradley (1985),“Administrative law is a branch of the public law
which is concerned with the composition, powers, duties, rights and liabilities of the various
organs of government which are encouraged in administration. Or more concisely, the law
relating to public administration”.

RULE OF LAW
 One Ideal among Others

The Rule of Law is one ideal in an array of values that dominates liberal political morality:
others include democracy, human rights, social justice, and economic freedom. The plurality
of these values seems to indicate that there are multiple ways in which social and political
systems can be evaluated, and these do not necessarily fit tidily together. Some legal
philosophers (e.g., Raz 1977) insist, as a matter of analytic clarity, that the Rule of Law in
particular must be distinguished from democracy, human rights, and social justice. They
confine the focus of the Rule of Law to formal and procedural aspects of governmental
institutions, without regard to the content of the policies they implement. But the point is
controversial. As we shall see, some substantive accounts have been developed, which
amount in effect to the integration of the Rule of Law with some of these other ideals.

2. The Concept the Rule of Law

The most important demand of the Rule of Law is that people in positions of authority should
exercise their power within a constraining framework of well-established public norms rather
than in an arbitrary, ad hoc, or purely discretionary manner on the basis of their own
preferences or ideology. It insists that the government should operate within a framework of
law in everything it does, and that it should be accountable through law when there is a
suggestion of unauthorized action by those in power.

But the Rule of Law is not just about government. It requires also that citizens should respect
and comply with legal norms, even when they disagree with them. When their interests
conflict with others’ they should accept legal determinations of what their rights and duties
are. Also, the law should be the same for everyone, so that no one is above the law, and
everyone has access to the law’s protection. The requirement of access is particularly
important, in two senses. First, law should be epistemically accessible: it should be a body of
norms promulgated as public knowledge so that people can study it, internalize it, figure out
what it requires of them, and use it as a framework for their plans and expectations and for
settling their disputes with others. Secondly, legal institutions and their procedures should be
available to ordinary people to uphold their rights, settle their disputes, and protect them
against abuses of public and private power. All of this in turn requires the independence of
the judiciary, the accountability of government officials, the transparency of public business,
and the integrity of legal procedures.

Beyond these generalities, it is controversial what the Rule of Law requires. This is partly
because the Rule of Law is a working political idea, as much the property of ordinary
citizens, lawyers, activists and politicians as of the jurists and philosophers who study it. The
features that ordinary people call attention to are not necessarily the features that legal
philosophers have emphasized in their academic conceptions. Legal philosophers tend to
emphasize formal elements of the Rule of Law such as rule by general norms (rather than
particular decrees); rule by norms laid down in advance (rather than by retrospective
enactments); rule by norms that are made public (not hidden away in the closets of the
administration); and rule by clear and determinate legal norms (norms whose meaning is not
so vague or contestable as to leave those who are subject to them at the mercy of official
discretion). But these are not necessarily what ordinary people have in mind when they call
for the Rule of Law; they often have in mind the absence of corruption, the independence of
the judiciary, and a presumption in favor of liberty.
Contestation about what the Rule of Law requires is partly a product of the fact that law itself
comprises many things, and people privilege different aspects of a legal system. For some the
common law is the epitome of legality; for others, the Rule of Law connotes the impartial
application of a clearly drafted statute; for others still the Rule of Law is epitomized by a
stable constitution that has been embedded for centuries in the politics of a country. When
Aristotle (Politics 1287b), contrasted the Rule of Law with the rule of men, he ventured the
opinion that “a man may be a safer ruler than the written law, but not safer than the
customary law”. In our own era, F.A. Hayek (1973: 72 ff.) has been at pains to distinguish the
rule of law from the rule of legislation, identifying the former with something more like the
evolutionary development of the common law, less constructive and less susceptible to
deliberate control than the enactment of a statute. There is also continual debate about the
relation between law and the mechanisms of government. For some, official discretion is
incompatible with the Rule of Law; for others it depends on how the discretion is framed and
authorized. For some the final determination of a court amounts to the Rule of Law; for
others, aware of the politics of the judiciary, rule by courts (particularly a politically divided
court) is as much an instance of the rule of men as the decision of any other junta or
committee (see Waldron 2002 for a full account of these controversies).

3. History of the Rule of Law

The Rule of Law has been an important ideal in our political tradition for millennia, and it is
impossible to grasp and evaluate modern understandings of it without fathoming that
historical heritage. The heritage of argument about the Rule of Law begins with Aristotle (c.
350 BC); it proceeds with medieval theorists like Sir John Fortescue (1471), who sought to
distinguish lawful from despotic forms of kingship; it goes on through the early modern
period in the work of John Locke (1689), James Harrington (1656), and (oddly enough)
Niccolò Machiavelli (1517); in the European Enlightenment in the writings of Montesquieu
(1748) and others; in American constitutionalism in The Federalist Papers and (and even
more forcefully) in the writings of the Federalists’ opponents; and, in the modern era, in
Britain in the writings of A. V. Dicey (1885), F.A. Hayek (1944, 1960, and 1973), Michael
Oakeshott (1983), Joseph Raz (1977), and John Finnis (1980), and in America in the writings
of Lon Fuller (1964), Ronald Dworkin (1985), and John Rawls (1971). Because the heritage
of this idea is so much a part of its modern application, a few highlights need to be
mentioned.

3.1 Aristotle

The work of Aristotle on the Rule of Law is still influential. Though he formulated the
question of whether it was better to be ruled by the best man or the best laws, he approached
that question realistically, noting that it depended not only on the type of law one was
considering but also on the type of regime that enacted and administered the law in question
(Politics 1282b)

But Aristotle did maintain that law as such had certain advantages as a mode of governance.
Laws are laid down in general terms, well in advance of the particular cases to which they
may be applied. Moreover,
laws are made after long consideration, whereas decisions in the courts are given at short
notice, which makes it hard for those who try the case to satisfy the claims of justice.
(Rhetoric 1354b)

There were, he conceded, some cases so fraught with difficulty that they could not be handled
by general rules—cases that required the focused insight of particular judges; he used the
term epieikeia (sometimes translated as equity). But these cases should be kept to a minimum
and legal training and legal institutions should continue to play a role in the way they are
disposed of. Aristotle’s discussion of the general desirability of rules and his treatment
of epieikeia continue to influence modern jurisprudence (see Scalia 1989 and Solum 1994).

3.2 John Locke

John Locke in the second of his Two Treatises of Government (1689) emphasized the

importance of governance through “established standing Laws, promulgated and known to
the People”. He contrasted this with rule by “extemporary Arbitrary Decrees” (Locke 1689:
§§135–7). Now the term “arbitrary” can mean many different things. Sometimes it means
“oppressive”. But when Locke distinguished the rule of settled standing laws from arbitrary
decrees, it was not the oppressive sense of “arbitrary” that he had in mind. In this context,
something is arbitrary because it is extemporary: there is no notice of it; the ruler just figures
it out as he goes along. It is the arbitrariness of unpredictability, not knowing what you can
rely on, being subject, as Locke put it (1689: §137), to someone’s

sudden thoughts, or unrestrain’d, and till that moment unknown Wills without having any
measures set down which may guide and justifie their actions.

In Locke’s story, one of the things that people wanted to get away from in the state of nature
was being subject to others’ incalculable opinions—even when those others were thinking as
hard and rigorously as they could about natural law. Your thinking might be different from
my thinking, and it might turn out that your view of the relation between your interests and
my interests and your property and my interests might be quite different from my view of the
matter and quite different again from the view of the next person I came across. The whole
point of moving from a state of nature to a situation of positive law was to introduce some
predictability into this picture.

Unfortunately, having laid down this requirement, Locke complicated matters by adding a
substantive principle of respect for private property: “The Supream Power cannot take from
any Man any part of his Property without his own consent”, and any law that purports to do
so is of no validity (Locke 1689: §138). But then there is a difficulty. Though Locke gave us
his own theory of prepolitical property rights—the so-called “Labor Theory” in Chapter Five
of the Second Treatise—it was itself far from uncontroversial. People in our day, as in his,
disagree about the rival claims of labor and occupancy; they disagree about the background
of common ownership; and they disagree about how much anyone may appropriate and how
sensitive his appropriation must be to the needs of others. We disagree about all that—in
ways that were made evident, for example, in the debates about the Lockean theory of Robert
Nozick (1974). And Locke and his contemporaries disagreed too; Locke knew, and signaled
in a number of places that he knew just how controversial all this was (Tully 1980: 64 ff; for
Locke’s awareness of the controversies, see Waldron 1999: 74–5).
By insisting therefore that positive law is subject to this substantive constraint, Locke
subjected the legislature to a discipline of uncertainty. Because the natural right of property
was controversial, so the administration of any substantive constraint along these lines was
bound to be controversial. And because the substantive constraint was supposed to affect the
validity of positive law (Locke 1689: §135), the effect would be that some people—let’s say
those who disagreed with Locke about the claims of labor over occupancy—would disagree
with him about which positive rules of property are valid and which are not.

3.3 Montesquieu

Montesquieu’s work on the Rule of Law is best known in connection with his insistence on
the separation of powers—particularly the separation of judicial power from executive and
legislative authority (see Montesquieu 1748: Bk. 11, Ch. 6). The judiciary has to be able to do
its work as the mouthpiece of the laws without being distracted from fresh decisions made in
the course of its considerations by legislators and policy-makers. Montesquieu’s views on the
separation of powers had a profound effect on the American founding, particularly in the
work of James Madison (Federalist Papers, §47).

Elsewhere in The Spirit of the Laws, Montesquieu developed a theory of the value of
legalism. Noting that despotic governments tend to have very simple laws which they
administered peremptorily with little respect for procedural delicacy, Montesquieu argued
that legal and procedural complexity tended to be associated with respect for people’s
dignity. He associated this sort of respect with a monarchy ruling by law, as opposed to
despotism:

In monarchies, the administering of a justice that hands down decisions not only about life
and goods, but also about honor, requires scrupulous inquiries. The fastidiousness of the
judge grows as more issues are deposited with him, and as he pronounces upon greater
interests. (Montesquieu 1748: Bk. VI, ch. 1, p. 72)

This emphasis on the value of complexity—the way in which complicated laws, particularly
laws of property, provide hedges beneath which people can find shelter from the intrusive
demands of power—has continued to fascinate modern theorists of the rule of law (e.g.,
Thompson 1975: 258–69).

In the modern debate we also hear echoes of the doctrine propounded in The Spirit of the
Laws (1748: Bk. 26, ch. 15, p.510) that “things that depend on principles of civil right must
not be ruled by principles of political right”. “Civil right”—Montesquieu’s word for what we
call private law—is, he said, “the palladium of property”, and it should be allowed to operate
according to its own logic, not burdened with the principles of public or political regulation.
A failure of the Rule of Law in this regard is likely to lead to the impoverishment of an
economy, as expectations collapse, and owners’ incentives for production and enterprise are
undermined (Montesquieu 1748: Bk. V, ch. 14, p. 61).

3.4 Dicey

Writing in the second half of the 19 th century, Albert Venn Dicey bemoaned what he saw as a
decline in respect for the Rule of Law in England. The Rule of Law used to be a proud
tradition that distinguished governance in England both from the executive domination
of droit administratif in France and also from the fatuous and abstract certainties of paper
constitutions in countries like Belgium etc. For Dicey, the key to the Rule of Law was legal
equality:

[W]ith us no man is above the law [and] every man, whatever be his rank or condition, is
subject to the ordinary law of the realm and amenable to the jurisdiction of the ordinary
tribunals. (1992 [1885]: 114)

Attractive as this is in the abstract, it exhibited a certain naivety so far as the legal position of
state officials was concerned. Officials are and often need to be treated differently in law than
the ordinary citizen: they need certain extra powers and they need to be hemmed in by extra
restrictions, so that they can be held accountable for the actions they perform in the name of
the community. For the ordinary person, the Rule of Law generates a presumption in favor of
liberty: everything which is not expressly prohibited is permitted. But for the state and its
officials, we may want to work with the contrary presumption: the state may act only under
express legal authorization.

Dicey had a knack of expressing the Rule of Law in terms of principles whose eloquent
formulations belied their deeper difficulties. His first principle of the Rule of Law was:

[N]o man is punishable or can be lawfully made to suffer in body or goods except for a
distinct breach of law established in the ordinary legal manner before the ordinary Courts of
the land. (Dicey 1992 [1885]: 110)

This seems fine if we are talking about the imposition of criminal sanctions. But “made to
suffer in … goods” can also be read to connote the imposition of restrictions on the use of
personal or corporate property, or the giving or withholding of licenses, grants, and subsidies.
It can be read as precluding any form of discretionary regulation. Dicey was indeed inclined
to disparage all administrative discretion, particularly where it seemed to be superseding what
had traditionally been regarded as judicial functions. But can we really do without discretion
in modern governance? Some modern scholars of administrative law have denounced Dicey’s
account as an “extravagant”, “absurd”, and pernicious version of the Rule of Law (Davis
1969: 27–32).

3.5 Hayek

F.A. Hayek was by training an economist, but he also nurtured an interest in the relation
between legal structures and forms of national economy. Hayek’s work on the Rule of Law
proceeded in two phases: (1) from his wartime book The Road to Serfdom (1944) through
to The Constitution of Liberty (Hayek 1960); and (2) the somewhat different account
presented in his trilogy, Law, Legislation and Liberty (1973), an account which is more
congenial to the spirit of common law and hostile to the role of legislation.

(1) Governance during wartime necessarily required total mobilization and management of
all of the society’s manpower and resources. Hayek warned in 1944 against the retention of
anything like this mode of administration in peacetime. He made an eloquent argument that
in normal times a society need not be managed but should be governed—and its people
largely left to their own devices—within a framework of general rules laid down in advance.
These rules would operate impersonally to protect people from one another, not being aimed
at any person or situation in particular and not being dependent for their operation on any
expectation on the part of government as to what the particular effects of their application
would be. But this lack of particular knowledge on the part of the government would be
offset by the fact that rules would provide a framework of predictability for ordinary people
and businesses. They would know that they would not be molested by the state, provided they
operated within the parameters of the general and impersonal rules. Human freedom, on
Hayek’s account, did not preclude all state action; but it does require that state action be
calculable.

(2) In the 1970s, Hayek began to rethink all this. The attention was still on the implications of
Rule of Law for liberty. But now Hayek began to wonder whether the texts of clear general
legislated rules would really provide an appropriate framework for freedom. It was, he said, a
mistake to think that “by confining the judge to the application of already articulated rules we
will increase the predictability of his decisions”. Articulated rules are “often a very imperfect
formulation of principles which people can better honour in action than express in words”
(Hayek 1973: 118). He favored something more like a common law model of predictability,
with principles and solutions emerging from a series of judicial decisions in an almost
evolutionary way.[1] The evolution of principles that distinguished themselves by their
reasonableness was superior, Hayek thought, to the deliberate imposition of rules by a
legislator. According to Hayek, the legislative mentality is inherently managerial; it is
oriented in the first instance to the organization of the state’s own administrative apparatus;
and its extension into the realm of public policy generally means an outward projection of
that sort of managerial mentality with frightful consequences for liberty and markets.

3.6 Fuller

Lon Fuller believed that government in accordance with the forms and procedures of law had
a distinctive value that could help close the gap of separation between positive law, on the
one hand, and morality and justice on the other. The conventional wisdom of the legal
positivists held that laws could be impeccably drafted and even-handedly administered and
still be hideously unjust: antebellum slave law in the United States and apartheid law in South
Africa were often cited as examples. But Fuller believed, as a matter of political psychology,
that there would be reluctance to use the forms of law—general and public norms—to
embody and inscribe injustice. He believed that “coherence and goodness [had] more affinity
than coherence and evil”, he thought bad things happened in the dark as opposed to the
sunlight of legality, and he maintained that “even in the most perverted regimes there is a
certain hesitancy about writing cruelties, intolerances, and inhumanities into law” (Fuller
1958: 636–7).

Fuller acknowledged that this link between legality and justice was tentative. It was certainly
controversial. But whether this connection held or not, he also wanted to insist that the
complete absence of respect for formal criteria of legality might deprive a system of power of
its status as law:

When a system calling itself law is predicated upon a general disregard by judges of the terms
of the laws they purport to enforce, when this system habitually cures its legal irregularities,
even the grossest, by retroactive statutes, when it has only to resort to forays of terror in the
streets, which no one dares challenge, in order to escape even those scant restraints imposed
by the pretense of legality—when all these things have become true of a dictatorship, it is not
hard for me, at least, to deny to it the name of law. (Fuller 1958: 660)
In his 1964 book The Morality of Law, Fuller formulated principles of what he called “the
inner morality of law”—principles requiring that laws be general, public, prospective,
coherent, clear, stable, and practicable—and he argued that these were indispensable to law-
making. Reviewing Fuller’s book, H.L.A. Hart (1965) asked in what sense these principles
could be called a “morality”. They seemed to be more like instrumental principles for
effective legislation, and on Hart’s view, they were only as moral as the enterprise they made
possible.

Fuller responded by denying that the significance of his eight principles was purely
instrumental. They also constituted a morality of respect for the freedom and dignity of the
agents addressed by the law: what they made possible was a mode of governance that worked
through ordinary human agency rather than short-circuiting it through manipulation or terror.
This thesis was separate from the connection between law and morality intimated in Fuller
1958. But the two accounts of the moral significance of law were connected in a way that
John Finnis explained:

A tyranny devoted to pernicious ends has no self-sufficient reason to submit itself to the
discipline of operating consistently through the demanding processes of law, granted that the
rational point of such self-discipline is the very value of reciprocity, fairness, and respect for
persons which the tyrant, ex hypothesis, holds in contempt. (1980: 273)

Fuller’s work on the Rule of Law had one last nuance. He understood that law constituted a
distinct kind of governance that might not be relevant for every task of the state. He
contrasted it not just with a Nazi-style reign of terror, but with the sort of managerial
administration that might be necessary for allocative decision-making in a mixed economy
like the United States in the 1960s. In modern political economy, said Fuller, we face
problems of institutional design “unprecedented in scope and importance”. Focusing more on
the procedural side of the Rule of Law, Fuller insisted that we lawyers acknowledge that
although “[a]djudication is a process with which we are familiar and which enables us to
show to advantage our special talents”, still it may be “an ineffective instrument for economic
management” (Fuller 1964: 176).

4. Rule of Law and Rule by Law

Some theorists draw a distinction between the Rule of Law and what they call rule by law
(see e.g., Tamanaha 2004: 3). They celebrate the one and disparage the other. The Rule of
Law is supposed to lift law above politics. The idea is that the law should stand above every
powerful person and agency in the land. Rule by law, in contrast, connotes the instrumental
use of law as a tool of political power. It means that the state uses law to control its citizens
but tries never to allow law to be used to control the state. Rule by law is associated with the
debasement of legality by authoritarian regimes, in modern China for example.

Thomas Hobbes may be seen as a theorist of rule by law. In a society whose members
disagree about property, he thought it conducive to peace for the sovereign of a society “to
make some common Rules for all men, and to declare them publiquely, by which every man
may know what may be called his, what anothers” (Hobbes 1647: Bk. II, ch. 6, sect. ix). But
Hobbes also thought that it would undermine peace—indeed it would undermine the very
logic of sovereignty—for the ultimate law-maker to be bound by the laws he applied to his
subjects (Hobbes 1991 [1651]: 184).
However, the distinction may not be so clear-cut. Even rule by law seems to imply that rulers
accept something like the formal discipline of legality. Unless the orders issued by the state
are general, clear, prospective, public, and relatively stable, the state is not ruling by law. So
this thin version of legality does still have moral significance in the respect it pays to the
human need for clarity and predictability. Rule by law “can be a way a government …
stabilizes and secures expectations” (Goodpaster 2003: 686). Even if its use remains
instrumental to the purposes of the state, it involves what Fuller called a bond of reciprocity
with the purposes of those who are governed: the latter are assured that the promulgated rules
are the ones that will be used to evaluate their actions (see also Winston 2005: 316).

Some jurists who maintain the contrast between the Rule of Law and rule by law have a more
ambitious agenda. They take seriously the ancient idea that we might be ruled by laws and
not by men. One may ask: how is that supposed to happen? After all, all law is made by
people and interpreted by people and applied by people. It can no more rule us by itself,
without human assistance, than a cannon can dominate us without an iron-monger to cast it
and an artilleryman to load and fire it. The jurists who contrast the Rule of Law with rule by
law believe they can make this work by focusing on laws whose human origins are in some
way diffuse or immemorial. We are not necessarily talking here about natural law, but
perhaps about something like customary law or common law—law that is not so evidently a
top-down product of powerful human law-makers (Epstein 2011). Common law grows and
develops under its own steam, and need not be conceived as a device by which some
identifiable humans rule over others. No doubt there is a lot of mythology in this. A more
realistic view of common law identifies it with the deliberate and arbitrary rule of an entity
that Bentham (1792) called “Judge & Co”. But it remains true that the human element is
diffuse in this sort of system, and at any given time the law that emerges is a resultant of the
work of many people rather than the intentional product of a domineering majority ruling us
from the legislative center of a state.

As we saw in the discussion of Hayek (1973), the other side of this coin is a disparagement of
legislation, precisely because its enactment seems patently and undeniably to represent the
rule of powerful officials. Legislation is a matter of will. The legislative process produces law
simply by virtue of a bunch of people in an assembly deciding that a given law is to be
produced. And this is done by the very men—powerful politicians—to whose power the Rule
of Law is supposed to be an alternative.

However, most people who value the Rule of Law do not accept this approach. If a statute is
properly drafted (if it is clear, intelligible and expressed in general terms) and prospectively
enacted and promulgated, and if it is administered impartially and with due process—they
will call this an entirely appropriate exercise under the Rule of Law. Indeed that is what many
scholars mean by the Rule of Law: people being governed by measures laid down in advance
in general terms and enforced equally according to the terms in which they have been
publicly promulgated. The argument that it should be put aside because it does not contrast
sufficiently with the rule of men seems perverse.

No one doubts that legislation can sometimes undermine the Rule of Law, by purporting for
example to remove legal accountability from a range of official actions or to preclude the
possibility of judicial review of executive action. But this is not a problem with legislation as
such; this is a concern about the content of particular enactments. Rule by judges, too, can
sometimes be seen as the very sort of rule by men that the Rule of Law is supposed to
supersede (see Waldron 2002: 142–3 and 147–8).
5. Formal, Procedural and Substantive Requirements

Theorists of the Rule of Law are fond of producing laundry lists of the principles it
comprises. These principles are of disparate kinds, which may loosely be divided into
principles that address the formal aspects of governance by law; principles that address its
procedural aspects ; and principles that embrace certain substantive values.

5.1 Formal Aspects

The best known are the eight formal principles of Lon Fuller’s “inner morality of law”:
(1964; see also the lists in Finnis 1980: 270–1; Rawls 1999: 208–10; and Raz 1979 [1977]:
214–18) generality; publicity; prospectivity; intelligibility; consistency; practicability;
stability; and congruence. These principles are formal, because they concern the form of the
norms that are applied to our conduct.

So for example, the requirement that laws be general in character, rather than aimed at
particular individuals, is purely a matter of form. It is compatible with invidious
discrimination so far as its substance is concerned, since even a norm like “A person who is
of African descent must sit in the back of any public bus that they ride on” applies,
universalizably, to everyone. A formal requirement of generality does not guarantee justice;
but that partly reflects the fact that justice and the Rule of Law work as separate criteria for
evaluating a political system.

Generality is an important feature of legality, reflected in the longstanding constitutional

antipathy to Bills of Attainder. Of course law cannot work without particular orders, but as
Raz points out (1979 [1977]: 213) the generality requirement is usually taken to mean that
“the making of particular laws should be guided by open and relatively stable general rules”.
These rules themselves should operate impersonally and impartially.

Besides the form of the rules themselves there is also the nature of their presence in society.
The Rule of Law envisages law operating as a relatively stable set of norms available as
public knowledge. It requires that laws be public and that they be promulgated well in
advance of individuals’ being held responsible for complying with them. These are features
that flow partly from the fact that laws are supposed to guide conduct, which they cannot do
if they are secret or retroactive. But it is not just a matter of the pragmatics of governance.
Laws face in two directions: (i) they impose requirements for ordinary citizens to comply
with; and (ii) they issue instructions to officials about what to do in the event of non-
compliance by the citizens. Laws that are secret and retroactive so far as (i) is concerned may
still operate effectively in respect of (ii). So the Rule-of-Law requirements of publicity and
prospectivity have an additional significance: they require that citizens be put on notice of
what is required of them and of any basis on which they are liable be held to account.

The requirement of clarity is also important in this regard. Laws must be public not only in
the sense of actual promulgation but also in the sense of accessibility and intelligibly. True,
much modern law is necessarily technical (Weber 1968 [1922]: 882–95) and the lay-person
will often require professional advice as to what the law requires of him. It is also an
important part of the Rule of Law that there be a competent profession available to offer such
advice and that the law must be such as to make it possible for professionals at least to get a
reliable picture of what the law at any given time requires. In the nineteenth century, Jeremy
Bentham (1782: ch. 15 and 1792) criticized customary law in general, and common law in
particular, for failing to satisfy this requirement: the sources of law were hidden in obscurity
and though there were spurious appeals to precedent, much of the law was just made up by
the judges as they went along.

5.2 Procedural Aspects

We should complement this list of formal characteristics with a list of procedural principles
as well, which are equally indispensable to the Rule of Law. We might say that no one should
have any penalty, stigma or serious loss imposed upon them by government except as the
upshot of procedures that involve (I have adapted this list from Tashima 2008: 264):

a. a hearing by an impartial and independent tribunal that is required to administer

existing legal norms on the basis of the formal presentation of evidence and argument;
b. a right to representation by counsel at such a hearing
c. a right to be present, to confront and question witnesses, and to make legal argument
about the bearing of the evidence and the various legal norms relevant to the case; and
d. a right to hear reasons from the tribunal when it reaches its decision, which are
responsive to the evidence and arguments presented before it.

Arguably, such procedural principles matter more in the ordinary person’s conception of the
Rule of Law than the formal criteria mentioned in the previous section. When people worried
that the American detention facility in Guantanamo Bay from 2003 to the present was a
“black hole” so far as legality was concerned, it was precisely the lack of these procedural
rights that they were concerned about. What the detainees demanded, in the name of the Rule
of Law, was an opportunity to appear before a proper legal tribunal, to confront and answer
the evidence against them (such as it was), and to be represented so that their own side of the
story could be explained. No doubt the integrity of these proceedings would depend in part on
the formal characteristics of the legal norms that were supposed to govern their detention,
whose application in their case they could call in question at the hearings that they demanded.
It is difficult to make a case at a hearing if the laws governing detention are kept secret or are
indeterminate or are constantly changing. Even so, we still miss out on a whole important
dimension of the Rule of Law ideal if we do not also focus on the procedural demands
themselves which, as it were, give the formal side of the Rule of Law this purchase.

Some procedural requirements are also institutional in character: there must be courts and
there must be judges whose independence of the other branches of government is guaranteed.
This side of the Rule of Law is connected with the constitutional principle of the separation
of powers. That principle is sometimes justified simply on the ground that it is unhealthy for
power to be institutionally concentrated in society. But it also has a Rule of Law justification
inasmuch as it assigns distinct significance to distinct stages in the making and application of
laws (Waldron 2013).

5.3 Substantive Theories

Though many jurists follow Raz 1977 in thinking that the Rule of Law is a purely
formal/procedural ideal, others believe in adding a more substantive dimension. They do not
think it is possible to sharply separate our political ideals in the way Raz seems to suppose.
At the very least, the formal/procedural aspects generate a certain momentum in a substantive
direction. Generality—proceeding according to a rule—is often said to contain the germ of
justice (Hart 1961: ch. 8). And, stability, publicity, clarity, and prospectivity indicate a pretty
fundamental connection between the Rule of Law and the conditions of liberty. We have to
be careful, however, to distinguish between allegedly substantive requirements of the Rule of
Law and specification of the deeper values that underlie and motivate the ideal even in its
formal and procedural requirements.

Some jurists believe that there is a special affinity between the Rule of Law and the
vindication and support of private property. Ronald Cass (2004: 131) says that “[a] critical
aspect of the commitment to the rule of law is the definition and protection of property
rights”.

[T]he degree to which the society is bound by law, is committed to processes that allow
property rights to be secure under legal rules that will be applied predictably and not subject
to the whims of particular individuals, matters. The commitment to such processes is the
essence of the rule of law. Cass (2004: 131)

Others, like Richard Epstein (2011: 10), accept that “[a]nalytically, the rule of law is … a
separate conception from private property”. But they think nevertheless that a contingent
connection between the Rule of Law and private property can be established by showing that
the forms of regulation defenders of private property are concerned about tend to be forms of
regulation that the Rule of Law, even on a more austere conception, prohibits.

It is also widely believed—though not necessarily by the same people who associate legality
with property—that a system of positive law that fails to respect fundamental human rights
should not be dignified with the term “the Rule of Law”. The World Justice Project in 2011
quoted Arthur Chaskalson, former Chief Justice of South Africa, to this effect:

[T]he apartheid government, its officers and agents were accountable in accordance with the
laws; the laws were clear; publicized, and stable, and were upheld by law enforcement
officials and judges. What was missing was the substantive component of the rule of law. The
process by which the laws were made was not fair (only whites, a minority of the population,
had the vote). And the laws themselves were not fair. They institutionalized discrimination,
vested broad discretionary powers in the executive, and failed to protect fundamental rights.
Without a substantive content there would be no answer to the criticism, sometimes voiced,
that the rule of law is “an empty vessel into which any law could be poured”. (World Justice
Project 2011: 9)

On the other hand, as we have seen, Joseph Raz (1979 [1977]: 211) is famous for insisting
that “the rule of law is just one of the virtues which a legal system may possess and by which
it is to be judged”, and that we should not try to read into it other considerations about
democracy, human rights, and social justice. Those considerations, he said, are better
understood as independent dimensions of assessment. Tom Bingham, in his book on The
Rule of Law, said this in response to Raz:

While … one can recognize the logical force of Professor Raz’s contention, I would roundly
reject it in favor of a “thick” definition, embracing the protection of human rights within its
scope. A state which savagely represses or persecutes sections of its people cannot in my
view be regarded as observing the rule of law, even if the transport of the persecuted minority
to the concentration camp or the compulsory exposure of female children on the
mountainside is the subject of detailed laws duly enacted and scrupulously observed.
(Bingham 2010: 67)
Lord Bingham’s position has an intuitive appeal in the eyes of many commentators, even if it
irritates in its casual rejection of a point whose logic it claims to recognize.

Both Chaskalson and Bingham seem to want to fill out the formal/ procedural conception of
the Rule of Law with some human rights component. And many liberals are inclined to
follow them in that. But this is not the only possibility. Many associate the Rule of Law with
a presumption of liberty or the principle of human dignity. Others—Arthur Chaskalson hinted
at this—associate the Rule of Law with a substantive dimension of democracy.

All this sounds an analytic danger signal. Once we open up the possibility of the Rule of
Law’s having a substantive dimension, we inaugurate a sort of competition in which
everyone clamors to have their favorite political ideal incorporated as a substantive
dimension of the Rule of Law. Those who favor property rights and market economy will
scramble to privilege their favorite values in this regard. But so will those who favor human
rights, or those who favor democratic participation, or those who favor civil liberties or social
justice. The result is likely to be a general decline in political articulacy, as people struggle to
use the same term to express disparate ideals.

6. The Values Underlying the Rule of Law

Even if the principles of the Rule of Law are purely formal in their application, we don’t just
value them for formalistic reasons. Most fundamentally, people value the Rule of Law
because it takes some of the edge off the power that is necessarily exercised over them in a
political community. In various ways, being ruled through law, means that power is less
arbitrary, more predictable, more impersonal, less peremptory, less coercive even. It
establishes what Fuller (1964: 39–40) called a bond of reciprocity—a mutuality of constraint
—between the ruler and the ruled, and in that sense it mitigates the asymmetry that political
power otherwise involves.

Connected with this, the Rule of Law is valuable and important because it establishes an
environment that is conducive to liberty. According to Hayek’s theory of the Rule of Law—
particularly in the early phase of his work (see section 3.5 above)—we value requirements
like generality and impersonality because they free us from dependence upon others’ wills:

My action can hardly be regarded as subject to the will of another person if I use his rules for
my own purposes as I might use my knowledge of a law of nature, and if that person does not
know of my existence or of the particular circumstances in which the rules will apply to me
or of the effects they will have on my plans. (Hayek 1960: 152)

Hayek also maintained that requirements of clarity, prospectivity and so on make an

important contribution to predictability, which he thought was indispensable for individual
freedom. Predictability is often cited as a Rule-of-Law virtue. In his well-known recent book
on the subject, Tom Bingham indicated that one of the most important things people needed
from the law that governed them was predictability in the conduct of their lives and
businesses. He quoted Lord Mansfield to the effect that

[i]n all mercantile transactions the great object should be certainty: … it is of more
consequence that a rule should be certain, than whether the rule is established one way rather
than the other. (Lord Mansfield in Vallejo v. Wheeler (1774) 1 Cowp. 143, p. 153 (cited by
Bingham 2010: 38))
Bingham went on to observe in his own voice that

[n]o one would choose to do business … involving large sums of money, in a country where
parties’ rights and obligations were undecided. (Bingham 2010: 38)

These conceptions claim to bring a certain air of reality to our discussions of freedom. There
may be no getting away from legal constraint in the circumstances of modern life, but
freedom is possible nevertheless if people know in advance how the law will operate and how
they have to act to avoid its application. Knowing in advance how the law will operate
enables one to make plans and work around its requirements (see Hayek 1960: 153 and 156–
7). And knowing that one can count on the law’s protecting property and personal rights
gives each citizen some certainty about what he can rely on in his dealings with other people.
The Rule of Law is violated, on this account, when the norms that are applied by officials do
not correspond to the norms that have been made public to the citizens or when officials act
on the basis of their own discretion rather than norms laid down in advance. If action of this
sort becomes endemic, then not only are people’s expectations disappointed, but increasingly
they will find themselves unable to form expectations on which to rely, and the horizons of
their planning and their economic activity will shrink accordingly.

So we need a basis for expectation. The best account of the importance of legal expectations
was given by the utilitarian philosopher Jeremy Bentham, in a work called “Principles of the
Civil Code”. Expectation, said Bentham, is “a chain which unites our present existence to our
future existence”.

It is hence that we have the power of forming a general plan of conduct; it is hence that the
successive instants which compose the duration of life are not isolated and independent
points, but become continuous parts of a whole. (Bentham 1931 [1802, 1864]: 111)

The establishment of expectations, said Bentham, is largely the work of law, and the security
of expectations is a vital constraint on the action of law: “The principle of security …
requires that events, so far as they depend upon laws, should conform to the expectations
which law itself has created…”.

Joseph Raz and Lon Fuller took the point about freedom even further. Raz (1979 [1977]: 221)
suggested that securing an atmosphere conducive to freedom was a matter of dignity:
“Respecting human dignity entails treating humans as persons capable of planning and
plotting their future” (Raz 1979 [1977]: 221). In Lon Fuller’s theory, too, the principles of the
inner morality of law were valued for the way they respected dignity:

To embark on the enterprise of subjecting human conduct to rules involves … a commitment

to the view that man is … a responsible agent, capable of understanding and following
rules…. Every departure from the principles of law’s inner morality is an affront to man’s
dignity as a responsible agent. To judge his actions by unpublished or retrospective laws, or
to order him to do an act that is impossible, is to convey … your indifference to his powers of
self-determination. (Fuller 1964: 162)

What is said here about the connection between dignity and Fuller’s formal principles can be
said even more about the connection between procedure and dignity. Procedural principles
capture a deep and important sense that law is a mode of governing people that treats them as
though they had a perspective of their own to present on the application of norms to their
conduct and situation. Applying a norm to a human individual is not like deciding what to do
about a rabid animal or a dilapidated house. It involves paying attention to a point of view.
As such it embodies a crucial dignitarian idea—respecting the dignity of those to whom the
norms are applied as beings capable of explaining themselves.

7. Opposition to the Rule of Law

No account of the Rule of Law is complete if it does not mention the ways in which this ideal
is deprecated. The laudatory history of the Rule of Law in the work of thinkers like Aristotle,
Locke, Dicey, Hayek and Fuller has been matched by opponents of legality such as Plato
(in The Statesman), Thomas Hobbes (at least if the Rule of Law is supposed to take us
beyond rule by law), and Carl Schmitt 1923 (in his attack on parliamentarism and on the
liberal assumption that rules can prevail even under conditions of endemic crisis).

The criticism by Plato (c. 370 BC) has been the most enduring. From his perspective, which
extolled the application of focused intelligence and insight by those in power, insistence upon
the use of law in government was

like a stubborn, stupid person who refuses to allow the slightest deviation from or questioning
of his own rules, even if the situation has in fact changed and it turns out to be better for
someone to contravene these rules. (Statesman 294b–c)

Rules themselves were part of the problem: “People and situations differ, and human affairs
are characterized by an almost permanent state of instability” (Statesman 294b). One would
use them, only as a (distant) second-best, if one felt one couldn’t discern or trust the
appearance of expertise in political life. These concerns are echoed in the work of modern
legal pragmatists (like Posner 1995) who place much more faith in insight of judges into new
situations than in the application of established rules or strained analogies with ancient
precedents.

Echoes of the Platonic critique are also heard in those who privilege decisive executive
decision-making in times of crisis, especially if the crises seem to be successive and unending
(Schmitt 1923; Posner and Vermeule 2010). Someone’s will has to prevail and, it is said, the
Rule of Law does us no service by pretending that the element of will can be eliminated from
politics or that decisiveness matters less than the “long deliberation” that was extolled in
Aristotle's Rhetoric.

The sense of what good law-making and ordinary legal administration require conveyed by
the principles of the Rule of Law is sometimes criticized as archaic. Partisans of the Rule of
Law often think in terms of clearly drafted and prospective measures promulgated as norms
that can stand in the name of the whole community and form a publicly acknowledged
framework for their actions and transactions. But this is not really how law operates in the
modern world. As Rubin 1989 points out, a great deal of modern legislation consists simply
of a frame-working statute authoring agencies to develop much more detailed rules which are
conveyed to the public—to the extent that is necessary—by modes of communication much
more complex and nuanced than those envisaged in traditional models of the Rule of Law.
For example, the principles comprised in Fuller 1964’s inner morality of law—see section
3.6 above—are recipes perhaps for the production of legislation that looks congenial to
legalistic concerns about clarity and predictability. But it has little or nothing to do with the
way law actually operates or the way legislatures communicate with agencies and agencies in
turn communicate with those whose actions and businesses they supervise (Rubin 1989: 397–
408).

At the same time, there are concerns about the mentality that is fostered by an excessive
emphasis on the Rule of Law. In its most extreme form, the Rule of Law can have the effect
of closing down the faculty of independent moral thought in the officials (the judges, for
example: see Cover 1975) or in the ordinary members of a community, making them anxious
in the face of uncertainty and distrustful of their own or others’ individual judgments (see
Henderson 1990). Sometimes it is important, for the sake of clear and courageous moral
judgment, not to exaggerate the importance of something being required by law. Other
concerns about the mentality fostered by the Rule of Law include concerns about legalism
and the tendency to over-formalize or over-bureaucratize relationships that are more healthily
conceived in terms that are more informal. This is not just a matter of legalizing the personal
realm; it is also a matter of understanding, for example, the damage that can be done to
relations between officials (like social workers) and vulnerable clients by replacing bringing
in rigid rules to replace relatively informal professional norms (Simon 1983).

8. Controversies about Application

As well as these debates about the value of the Rule of Law there is, within the camp of those
who stand for legality, incessant controversy about what the Rule of Law requires. I have
mentioned the general debates between defenders of formal, procedural, and substantive
conceptions. There are also a number of particular debates.

8.1 Discretion

How far should it be the mission of the Rule of Law to eliminate or reduce the amount of
discretion in the way a society is governed? Some jurists, like Dicey (1885) and to a lesser
extent Hayek (1944) insist that official discretion is inherently antithetical to the Rule of Law.
Others, like Davis (1969), condemn this as an extravagant position, arguing that discretion is
ineliminable in the modern administrative state. The rule of the Rule of Law is not to
eliminate discretion, but to ensure that it is properly framed and authorized, and that the
application of rules and judicial procedures is preserved for those cases where liberty and
well-being are most seriously at stake.

8.2 Rules and Standards

A similar question arises with regard to the use of norms that have the character of standards
rather than rules. (A rule is like a numerical speed limit, whereas a standard is like a norm
that requires people to drive at a “reasonable” speed.) Legal systems use both types of norm
(Sunstein 1994); they use standards for cases where the appropriate decision may vary with
ambient circumstances and it seems better to trust the judgment of those who face a particular
situation, rather than laying it down in advance. There is an element of respect for
individuals’ powers of discernment conveyed in the use of a standard. At the same time
standards allow for less certainty in the law, especially when it is difficult for the person
attempting to comply with the norm to predict how his judgment will be viewed by an official
or by a court. Hayek suggests that

[o]ne could write a history of the decline of the Rule of Law … in terms of the progressive
introduction of these vague formulas into legislation and jurisdiction. (1972 [1944]: 78)
Whether he is right depends partly on how far we take the Rule of Law to be wedded to
predictability: is predictability the be-all and end-all, or does the Rule of Law also promise a
kind of legal system that frames and facilitates reason and thoughtfulness in human affairs?

8.3 Law and Social Norms

Sometimes situations can be governed and disputes settled by informal social norms rather
than by positive law, formally enacted and enforced (Ellickson 1994). Opinions differ as to
whether this should be regarded as something altogether different from the Rule of Law. On
the one hand, it looks like a genuine alternative, and little is gained by assimilating its
desirable features, such as they are, to Rule-of-Law requirements. On the other hand, it does
have something in common with understandings of customary law and conceptions of the
Rule of Law (like that of Hayek 1973) that try to separate themselves from enactment and
legislation. Also it is sometimes said that the Rule of Law works best when what is enforced
in a society can be mapped on to its members’ norms of fairness and common-sense. This
makes social participation in the integrity and upholding of law more likely (Cooter 1997).
The closer this mapping, the less of an investment there has to be in formal legal
promulgation: ordinary know-how can become a reliable guide to legal knowledge. However,
one has to be very cautious with this. Modern law is inevitably technical in ways that far
outstrip the possibilities of intuitive understanding (Weber 1968 [1922]: 882–95). The best
that can be hoped for is some sort of occasional consonance between enacted law and
informal understandings, and the sporadic character of that may well heighten rather than
reduce unpredictability.

8.4 Emergencies

Is it reasonable to use the Rule of Law to evaluate the way a society responds to
emergencies? It is often thought that emergencies require forms of state action that are more
peremptory and less procedurally laborious than those required in normal times. As a matter
of fact, a number of possibilities have been discussed (Scheuerman 2006). One is to insist, in
the name of the Rule of Law, that existing constitutional safeguards should remain in force;
that, after all, is what they were designed for and these situations are where they are most
urgently needed. Alternatively, in emergencies, one might rely on a general spirit of
flexibility and circumstantial sensitivity in state action that is encouraged even in normal
times. On this second option, the Rule of Law does not present itself as a major constraint on
the flexibility of state action in face of danger. As a third option, one might seek to preserve
something like the Rule of Law by laying down in advance specific legal rules to govern
emergencies—rules that suspend ordinary civil liberties guarantees for example or authorize
widespread discretion on the part of officials to undertake action that would normally be
governed by general rules of law. (Machiavelli proposed a version of this in
his Discourses (1517), extolling the institution of dictator in the Roman republic.) This option
has the advantage of predictability; but its disadvantage is that it endorses a sort of Rule-of-
Law-lite, which may eventually infect or supersede the conception of the Rule of Law that is
supposed to be normally applicable.

8.5 International Law

The Rule of Law applies not only within national polities but also increasingly between them,
but in this arena its use remains under-theorized (for a helpful discussion, see Crawford
2003). Much of the work that has been done on the international Rule of Law simply adopts
uncritically the perspective of those who say, at the national level, that the Rule of Law
requires determinacy, clarity, and predictability (see Chesterman 2008). But this may be
misconceived when we are talking about states rather than individuals as the subjects of law
(Waldron 2011b). States are in a much better position to be informed of what their legal
requirements are than individual men and women in society, since they are parties to the
treaties and practices that establish international law. (Maybe, though, this point does not
hold to the same extent when we consider the murky depths of customary international law.)

Anyway, the liberty of an individual state is not such an important value as the liberty of an
individual person. It is not clear that national states need protection from international law
and the power that it represents in the way that ordinary men and women need protection
from the exercise of political power in society. Moreover, in areas like international human
rights law, any presumption based on the Rule of Law in favor of the liberty of national states
will tend to have detrimental effects on the liberty or well-being of individual men and
women. We have to be careful therefore that invocation of the Rule of Law in the
international realm does not undermine the values that are supposed to be secured by this
ideal within national polities.

One additional point. It remains controversial whether international institutions themselves—

like the United Nations and its agencies—should be bound by the Rule of Law. This odd
because these agencies are among the most vociferous advocates of the Rule of Law so far as
its application to national states is concerned. The reluctance here stems in large part from an
estimation of the importance of diplomatic immunity. UN officials worry that if they and
their agencies are held legally liable for malfeasances of various kinds associated with peace-
keeping activities, there is a danger that the whole basis of international action might unravel.
The danger is probably exaggerated, however, and those who make this argument would not
for a moment countenance a similar argument in the sphere of national states.

8.6 Development and Nation-Building

The Rule of Law is often cited as the key to nation-building and to the establishment of new
democracies. Indeed it is often argued (e.g., Barro 2000) that a new state needs Rule-of-Law
institutions—effective courts and commercial codes that can secure property rights and the
enforcement of contracts—more than or even before it needs democratic institutions such as
an elected legislature. It is said that a legal system in a developing country dominated by
legislative action will neither inspire the confidence nor establish the stability that modern
governance and investment require. (For discussion of these arguments, see Carothers 1998
and—more critically—Carothers 2009.) This raises once more the question of relation
between the Rule of Law and legislation—only now it takes us also in the direction of
considering an rather uncomfortably direct trade-off between Rule of Law values and
democracy.

9. The Rule of Law and the Concept of Law

Finally, an analytic question. What is the relation between the Rule of Law and the concept of
law? A case can be made—controversial, no doubt—for bringing the two of them together
(see Waldron 2008 and also Simmonds 2008). The concept of law could be understood to
embrace the fundamental elements of legality, though this identification looks less plausible
the more substantive the conception of the Rule of Law is held to be. On this account, a
system of governance doesn’t count as law unless it exhibits the characteristic forms and
processes that we associate with legality. Otherwise we lose our sense of the institutional
distinctiveness of law as a way of ruling a society. We saw earlier that Lon Fuller (1958 and
1964) envisaged a connection along these lines. So, in his later work did Ronald Dworkin.
Dworkin (2004) asked us to consider a situation in which judges and lawyers were grappling
with hard issues of interpretation or with difficult dilemmas posed by multiple sources of law.
He said that in such cases, we might say that what was required as a matter of law might be
different from what was required as a matter of justice. That is a familiar separation (even if
Dworkin thought it was narrower and more blurred than most legal positivists believed). But
he said, it would make no sense to say that what was required as a matter of legality or
respect for the Rule of Law was different from what the legal solution was to this case. To
figure out the legal solution we have to address the various legal and political materials
precisely in light of our commitment to legality.

A conception of legality is … a general account of how to decide which particular claims are
true…. We could make little sense of either legality or law is we denied this intimate
connection. (Dworkin 2004: 24–5)

However this is not the received position. According to Joseph Raz (1977) and others you
cannot understand what the Rule of Law is unless you already and independently understand
what law is and the characteristic evils that law is likely to give rise to (which the Rule of
Law tries to prevent). On this account, legality represents a particular set of concerns about
law that have emerged in our civilization. The fact that these concerns are undoubtedly moral
in character (even though they are not comprehensive moral concerns) means that—in Raz’s
view—it is better to keep them separate from the concept of law itself, for fear of introducing
a moral element into that concept.

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Unit –II
Classification of Functions
2.1 Separation of Powers
2.2 Difficulty in Characterization of functions
2.3 Subordinate legislation( Rule Making Functions)
2.4 Quasi-Judicial Functions
2.5 Purely Administrative Functions
2.6 Difference between the different kind of functions

CLASSIFICATION OF ADMINISTRATIVE FUNCTION

INTRODUCTORY ’Tfhere is a great variety of administrative powers, such as to investigate, to

prosecute, to make rules and regulations, to adopt schemes, to fix prices, to issue and cancel
licences, to adjudicate on disputes etc. W hen an administrative action partakes of some judicial
characteristics, it is characterised as ‘quasi-judicial’. Decisions of a court of law are judicial in nature,
though in certain matters the judges may act administratively. Administrative authorities act either
in an administrative or a quasi-judicial manner but never in judicial manner for, by and large, they
lack the impartiality and objectivity of a judge and it is therefore best, in order to avoid confusion, to
apply the expression judicial to a court and not to an administrative authority. A question which
often arises in administrative law is whether the function performed by a body is administrative,
quasi-judicial or legislative in character. The answer to this question bristles with difficulties as there
is no precise test to distinguish the three functions* A further difficulty in such classification is
created by the fact that a single proceeding may at times combine some aspects of all tfee thre^
functions. “ It is indeed difficult in theory and impossible in ;|>ra^Ce to draw a precise dividing line
between the legislative on the dHe.fiini and the purely administrative on the other; administrative
action so often partakes o f both legislative and executive chatactf*ristics. The true nature of
statutory pr^isions aiiil o f regulations made thereunder is not infrequently still further complicated
by the addition of a quasi-judicial aspect. Though there exists no clear formula for making the
distinction between legislative, administrative and quasi-judicial functions, the distinction is,
nevertheless, sought to be made as several legal consequences flow from it, e-g-i a body exercising
quasi-judicial function is bound to follov? principles of natural justice and is amenable to the writ of
certiorari or prohibition and also to the special leave jurisdiction of the Supreme Court under article
136. On the other hand., it is act so in the case of a body exercising an administrative or legislative
function involving quasi-judicial aspect at any stage; it is subject only to a relatively restricted judicial
review. Problems of sub-delegation have a somewhat different connotation depending on the
nature of the function. For instance, the legal rights of a person may depend upon the
characterisation of rules or principles issued by the administration for the guidance of an authority
as legislative or administrative; if regarded as merely administrative instructions, and not legislative
in character or having a statutory force, they may not be enforceable by the aggrieved party. There
is no precise formula to describe the nature of the administrative action, and the case-law is neither
consistent nor coherent. Legislation is also distinguished from administration on the ground that the
former has an element of generality about it, as it applies to a group of persons, whereas the latter is
particular in its application. But this does not provide an articulate test, for it is not always possible
to separate particular from general. ‘V ^ u c h more difficult it is to distinguish administrative from
quasijudicial function- W hether an authority acts in a quasi-judicial or administrative capacity
depends on the scope and effect of the power conferred by the statute and/or the rules. Ordinarily it
is said that if the statute imposes either expressly or by necessary implication an 92 INDIAN a d m in
is t r a t iv e LAW [ CHAPTER 3 obligation to act judicially, the authority acts in a guasi-iudicial
manner. But this proposition, it would seem, is hardly illuminating. It is, to some extent, tautologous
to say that the function is quasijudicial if it is to be done judicially. Furthermore, it is not common in
the statute to find any specific or express statement that the body ^functioning under it should act
in a quasi-judicial manner. In most icases, such a duty has to be inferred from the statute. If a body I.
Repart o f the Committee on Minister’s Powers 19 (1932). decides a dispute iHs) between two
opposing parties, then prima lacic, in the absence of anything to the contrary in the stature, the
(body may be treated as quasi-judicial. But the absence of two parties j is not, however, decisive of
the character of the body’s function. It ' tile act prejudicially affects a person, the body may still be
regarded as acting in a quasi-judicial manner if the relevant statute implies so. Thus, when a body
decides a controversy between itself and another 3erson, it may be regarded as acting in a 'quasi-
judicial' or administrative' manner. Ultimately, whether a body acts in a quasi-judicial or
administrative capacity is a question to be determined in each case, by an examination of relevant
facts, circumstances, statute, and rules framed thereunder, if any. As W anchoo, J. has observed in
Board of High School V. Ghanshyam:^ “ The inference whether the authority acting under a statute
where it is silent has the duty to act judicially will depend o n the express provisions of the statute
read along with the nature of the rights affected, the manner of the disposal provided, the objective
criterion, if any, to be adopted, the effect of the decision on the person affected and other indicia
afforded by the statute. A duty to act judicially may arise in widely different circumstances which it
will be impossible and indeed inadvisable to attempt to define exhaustively,”^ SECTION I 1
AmUNISTRATlVE FCNCTIONS 93 SECTION 2. LEGISLATIVE OR JUDICIAL FUNCTION SCHWARTZ, AN
INTRODUCTION TO AMERICAN ADMINISTRATIVE LAW 106-7 (1958) Probably the most famous
attempt to explain the difference between legislative and judicial functions is that made biy Justice
Holmes in P rentis v. A tlantic C oast Line C om pany, “ A jiidicial inauiry,” said he, “ investigates,
declares, and enforces liabilities as they stand on present or past facts and under ;I|iws supposed
already t o exist Thar is its purpose and end. Legislati#^’^ the other hand looks to the 2. AXR.
t962S.C.IU0. 3, Z i/,a tlll3 -r future and changes existing conditions by making a new rule to be
applied thereafter to all or some part of those subject to its power.” The key factor in Justice Holm
es’s analysis is the element of time; a rule prescribes future patterns of conduct; a decision
determines liabilities upon the basis of present and past facts. The element of applicability has been
emphasized by other commentators as the key in differentiating legislative from judicial functions.
According to them, a rule is a determination of general applicability, “ addressed to indicated but
unnamed and unspecified persons or situations;” a decision on the other hand, applies to specific
individuals or situations. A s expressed by Professor Dickinson, "what distinguishes legislation from
adjudication is that the former affects the rights of individuals in the abstract and must be applied in
a further proceeding before the legal position of any particular individual will be definitely touched
by it; while adjudication operates concretely upon individuals in their individual capacity.” Both the
approach of Justice Holmes and that of Professor Dickinson will enable one to distinguish between
rule making and adjudication in the great majority of cases. There are, however, certain situations
which cause difficulty. Thus, under Justice H olm es’s test, an administrative determination which is
future in effect is a rule. This w^ould lead to the conclusion that licensing or issuance of injunctive
orders, such as a cease and desist order of the Federal Trade Commission, are instances of rule-
making; which would be undesirable from the point of view of the procedural requirements which
should be necessary in such cases* On the other hand, if the test of applicability be adopted, a
function such as rate-making would be classified as judicial, although most of the authority on the
point indicates that it is legislative in character. 94 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3
EXPRESS NEWSPAPER LTD. v. UNION OF INDIA A. I. R. 1958 S. a 578, 610 Bhagwati, J. The distinction
between a legislative and a judicial function is brought out in Cooley's Constitutional Limitations, 8th
Edn...VoI. I at p. 185 under the caption of “ The powers which the legislative department may
exercise" ;— ‘’Oil general principles, these inquiries, deliberations, orders, and dccrccs, which are
peculiar to such a department, must in d’ eir nature .be judicial acts. N or can they be both judicial
and legislative; because a marked difference exists between employment of judicial and legislative
tribunals. The formcr decide upon the legality of claims and conduct, and the latter make rules upon
which, in connection with the constitution, those decisions should be founded. It is the province of
judges to determine what is the law upon, existing eases. In fine, the law is applied by one, and
made by the other. T o do the first, therefore,— to compare, the claims of parties with the law of the
land before established— is in its nature iudicial act. But to do the last— to pass new rules for the
regulation of new controversies— is in its nature a legislative act; and if these rules interfere with
the past, or the present and do not look wholly to the future, they violate the definition of a law as “
a rule of civil conduct,’' because no rule of conduct can with consistency operate upon what
occurred before the rule itself was promulgated. “ It is the province of judicial power, also to decide
private disputes between or concerning persons; but of legislative power to regulate public cocerns,
and to make laws for the benefit and welfare of the State. N or does the passage of private statutes,
when lawful, are enacted on petition, or by the consent of all concerned; or else they forbear to
interfere with past transactions and vested rights....” A practical difficulty, however, arises in thus
characterising the functions legislative or judicial because the functions performed by administrative
agencies do not fall within water-tight compartments. Stason and Cooper in their treatise on “ Cases
and other materials on Administrative Tribunals” point out at page 150 ; “ One o f the great
difficulties of properly classifying a pairticular function of an administrative agency is that frequently
—and, indeed, typically— a single function has three aspects- It is partly legislative, partly judicial
and partly administrative. Consider, for example, the function o f rate-making. It has sometimes
been characterised as legislative, sometimes as judicial In some aspects, actually, it involves merely
executive or administrative powers. For example, where the Interstate Commefce Commission fixes
a tariff of charges for any railroad^ its fucttan is viewed as legislative. But where the g^eation io r
decision is whether a SCCTIOX 2 J ADMINISTRATIVE FUNCTIONS g5 shipment of a m kture of coffee
and chicory should be charged the lower rate established for chicory, the question is more nearly
judicial. On the other hand, where the problem is merely the calculation of the total freight charges
due for a particular shipment, the determination can fairly be described as an administrative act.”
This difficulty is solved by the Court considering in a proper case whether the administrative agency
performs a predominantly legislative or judicial or administrative function and determining its
character accordingly. 96 INDIAN ADMINISTRATIVE LAW [CHAPTERS SECTION 3. LEGISLATIVE OR
EXECUTIVE FUNCTION GRIFFITH AND STREET, PRINCIPLES OF ADMINISTRATIVE LAW 51 (3d ed. 1963)
The distinction between “ legislative” and “executive” is very difficult to draw. There are two tests
which have been suggested. The first is institutional: that which the Legislature enacts is legislation.
Since no subordinate legislation is strictly enacted by Parliament, this is of no value. If the meaning
of the word “ enacts” is extended to include that which is done by Parliamentary authority, all kinds
of actions are let in and solution is no nearer. Secondly, the meaning of “legislative” and “ executive”
may be determined by reference to the nature of the action. By this test, a power to make rules of
general application is a legislative power and the rule is a legislative rale. A power to give orders in
specific “ cases” is, by the same test, an executive power and the order is an executive action. The
difficulty here is that of distinguishing between what is “ general” and what is “ specific.” These
words, although they have some extreme and easily recognisable forms, do not help to solve the
doubtful cases. The matter is finally one for arbitrary decision. FRIEDMAN AND BENJAFIELD,
PRINCIPLES OF AUSTRALIAN ADMINISTRATIVE LAW 41 (1962) In 1932, the Committee on Minister’s
Powers attempted a distinction between the functions of legislation and administration on the
following lines: (a) Legislation is the process of formulating a general rule of conduct, without
reference to particular eases, and usually operadiig in futuro. (b ) Execution is the process of
performing particular acts, of issuing particular orders, or (as usually) of making decisions which
apply general rules to particular cases. The Committee was fully aware of the great difficulty in using
such a definition. Thus a power vested in a Board o£ Education to make grants to secondary schools
if they satisfied the Board that they were being efficiently maintained might appear, on the face o f
it, to be plainly executive or administrative but, if the B M M were to elaborate in detail the
conditions under which it would regard a school as qualifying for a grant, and issue circulars setting
out such conditions for the information of schools, this would seem to be in substance the
formulation of a general rule. Thus the function of the Board may be regarded as legislative from
one point of view and as administrative from another. Indeed the distinction between that which is
general and that which is particular in its application is itself only a matter of degree and it has been
suggested that the classification of a discretion as legislative or administrative will often “ depend
rather upon the nature of the authority in whom the power is reposed and upon the measure and
extent of the power, its subject matter and its limitations and the conditions in and upon which it is
exercisable.” SECTION 3 ] ADMINISTRATIVE FUXCriONS 97 WADE, ADMINISTRATIVE LAW 249-50, 264
(1961) Administrative Legislation One of the principal administrative activities is legislation.... This
administrative legislation is traditionally looked upon as a necessary evil, an unfortunate but
inevitable infringement of the separation o f powers. But this is an old-fashioned view .... There is
oftly a hazy border-line between legislation and administration, and the assumption that they are
two fundamentally difFeSant forms o f power is misleading. There are some obvious general
differences. But the idea that a clean division can be made (as it can, m oie probably, in, the case of
the judicial pow er) is a legacy from an older era: o f political theory. It is easy to see that legislative
power is the power to jay dowfi the law fpr people in general whi^jeas adpoinistrative the power to
lay down the law for them individually, or in some particular case.... In fact it is largely a question of
taste where the line is drawn. Nor does it much matter for our purposes. For legal purposes—judicial
control, statutory interpretation, and the doctrine of ylfra vires—there is common ground
throughout both subjects. W hat does matter is that both involve the grant of wide discretionary
powers to the government,... Although most people assume that they can tell legislation’ when they
see it, it easily merges into ‘administration’.... M uch of the work o£ the administration consists of
legislation. W hy, then should they be distinguished? Apart from theoretical analysis, are there any
legal or political results of the distinction? In fact, there are. For one thing, it is a general principle
that legislative acts should be public, so that all may know the law. For another, people’s legal rights
may depend on the distinction. 98 INDIAN ADMINISTRATIVE LAW [CHAPTERS SECTION 4.
ADMINISTRATIVE OR QUASI-JUDICIAL FUNCTION COMMITTEE ON MINISTER’S POWERS 73-75, 81-82.
9 (1929) Judicial or Quasi-Judicial Decision A “ quasi-judicial” decision is thus one which has some of
the attributes of a judicial decision, but not alL.., A true judicial decision presupposes an existing
dispute between two more parties, and then involves requisites (1) the presentation (not necessarily
orally) of their case by the parties to the dispute: (2) if the dispute between them is a question of
fact, the ascertainment of fact by means of evidence adduced by the parties to the dispute and often
with the assistance of argument by or on behalf of the parties on the evidence; (3) if the dispute
between them is a question of law, the submission of legal argument by the parties; and (4) a
decision which disposes of the whole matter by finding upon the facts in dispute and an application
of the law of the land to the facts so found, including, where required, a ruling upon any disputed
question of Jaw. A quasi-judicial decision equally presupposes an existing dispute between two or
more parties and involves (1) and (2) but does not necessarily involve (3) and never involves (4). The
place of (5) is in fact taken by administrative action, the character of wliicli is determined by the
Minister's free-choice. For example, suppose a statute empowers a Minister to take action if certain
facts are provided, and in that event gives him an absolute discretion v^hether or not to take action.
In such a case he must consider the representations of the parties and ascertain the facts— to that
extent the decision contains a judicial element. But, the facts once ascertained, his decision does not
depend on any legal or statutory direction, for hypothesi he is left free within his statutory powers to
take such ad'^feistrative action as he may think fit; that is to say that the matter is not finally
disposed of by the process of (4). W hereas it is of the essence of a judicial decision that the matter is
finally disposed of by that process and nothing remains to be done except the execution of the
judgment, a step which the law of the land compels automatically, in the case of the quasi-judicial
decision the finality of (4) is absent; another and a different kind of step has to be taken; the
Minister— who for this purpose personified the whole administrative Department of State—has to
make up his mind whether he will or will not take administrative action and if so what action. His
ultimate decision is “ quasi-judicial", and not judicial, because it is governed, not by a statutory
direction to him to apply the law of the land to the facts and act accordingly, but by a statutory
permission to use his discretwn after he has ascertained the facts and to be guided by considerations
of public policy. This option would not be open to him if he were exercising a purely judicial function.
It is obvious that if all four of the above named requisites to a decision are present, if, for instance, a
Minister, having Ascertained the facts, is obliged by the statute to decide solely in accordance with
the law, the decision is judicial. The fact that it is not reached by a court so-called, but by a Minister
acting under statutory powers and under specialised procedure, will not make the decision any the
less judicial.^ In the above analysis we have tried to explain the essential characteristics of a judicial
decision in the full sense of the pi^0s0';: and we have expressed the view that quasi-judicial decision
imports only some, and not all, of those characteristics; or, putting the same point in another form,
that the Minister at some stage in his mental 1. The validity of distinction made by the Committee
between law and discretion is considemi in Chapter VI on AdmMstte^he SECTION 4 ]
ADMINISTRATIVE FUNCTIONS 99 operations before his action takes final shape passes from the
judge into the administrator. But whether the function be judicial or quasijudicial, its exercise
presupposes the existence of a dispute and parties to the dispute, and it is this feature which
separates the judicial and quasi-judicial function on the one hand from the administrative on the
other.... Administrative decisions to be distinguished Decisions which are purely administrative stand
on a wholly different footing from ciuasi-judicial as "well as from judicial decisions and must be
distinguished accordingly.... In the case of the administrative decision, there is no legal obligation
upon the person charged with the\'AM A. I. R. 1950 S, C. 222 [ The petitioner was a tenant of a flat
On February 26, 1946, the Bombay Government requisitioned the flat under section 3 of the Bombay
Land Requisition Ordinance, 1947, and allotted it to another refugee from Sind. On March 4, 1946,
the petitioner filed a petition for a writ of certiorari, which having been granted by the Bombay High
Court, the Government came on appeal to the Supreme Court. Section 3 of the Ordinance ran as
follows ; Requisition o f land—If in the opinion of the Provincial Government it is necessary or
expedient to do so, the Provincial Government may by order in writing requisition any land for any
public purpose: Provided that no land used for the purpose of public religious worship or for any
purpose which the Provincial Government may specify by notification in the Official Gazette shall be
requisitioned under this section.] Kania, C. J. (with whom Sastri, J. joined) [I]t "was pointed out that
under S. 3 of the Ordinance the decision of the Provincial Government to requisition certain
premises is clearly a matter of its opinion and therefore not liable to be tested by any objective
standard. It was urged that the decision as to whether the premises were required for a public
purpose was also a matter for the opinion of the Provincial Government, and not a matter for judicial
investigation, and therefore the making of the order was in no sense a quasi-judicial decision, but an
administrative or ministerial order. In this connection it was pointed out that unlike the Land
Acquisition A ct there was no provision in the Ordinance for issuing a notice, or for inquiries to be
made, or for rival contentions to be examined and evidence to be weighed before a decision is
arrived at. It was pointed out that if public purpose was outside the scope of the opinion of the
Provincial Government, the section would have run: “ If for any public purpose in the opinion of
Government..4." In Regina (John M'Evoy) v. Dublin Corporation (1872) 2 L . R. Ir, 371 at p. 376, M ay
C J. in dealing with this point observed as ip|low§ ; ,: “ It is established that the writ of certiorari
does not lie tu remove an order merely ministerial, such as a warrant but it lies to remove and
ajudicate upon the validity o f acts judicial In this connection, the term ‘judiciar does not necessarily
mean acts of . a judge or legal tribuna! sitting for the or mattefs ^ SECTION 4 j ADMlNiSTRATiVE
FUNCTIONS lOi of law, but for the purpose of this question a judicial act seems to be an act done by
competent authority, upon consideration of facts and citcurastances, and imposing liability or
affecting the rights of others.” On behalf of the respondent it was contended that, as stated by May
C. J., whenever there is the determination of a fact which affects the rights of parties, that
determination is a quasi-judicial dicision and, if so, a writ of certiorari will lie against the body
entrusted with the work of making such decision. A s against this, it was pointed out that in several
English cases emphasis is laid on the fact that the decision should be a judicial decision and the
obligation to act judicially is to be found in the A ct estabHshing the body which makes the decision.
This point appears to have been brought out clearly in The King v. The Electricity Commissioners
(1924) K.B. 171'. L. J. K. B. 390, where A tkin L. J. (as he then was) laid down the following test: “ W
herever any body of persons having legal authority to determine questions affecting the rights of
subjects, and having the duty to act judicially, act in excess of their legal authority they are subject to
the controlling jurisdiction of the King’s Bench Division exercised in these writs.” This passage has
been cited with approval in numerous subsequent decisions and accepted as laying down the correct
test. A slightly more detailed examination of the distinction is found in The King V. London County
Council (1931) 2 K.B. 215 at p. 233: (100 L.J.K.B. 760), where Scrutton L. J. observed as follow s: It is
not necessary that it should be Court in the sense in which this Court is a Court; it is enough if it is
exercising, after hearing evidence, judicial functions in the sense that it has to decide on evidence
between a proposal and an opposition; and it is not necessary to be strictly a Court; if it is a tribunal
which has to decide the rights after hearing evidence and opposition, it is amenable to the writ of
certiorari, ” Slesser L.J. in his judgment at p. 243 separated the four conditions laid down by Atkin L.
J. under which a rule for certiorari may issue. They are: wherever any body of persons (1) having
legal authority (2) to determine questions affecting rights of subjects and (3) having the duty to act
judicially (4) act in excess of their legal authority— a writ of certiorari may issue. He examined each
of these conditions 102 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3 separately and came to the
conclusion that the csistcncc of cacb was nccessary to determine the nature of the act in auesticn....
In Frenklin v. Minister o f Town a n d Cotmtiy Planning, A.C, 87; (1947-2 A il E. R. 2S9j,....The question
arose in respect or tlic town and country planning undertaken under the relevant Statute on the
Oder of the Minister following a public local inquiry under the provisions of the A ct. The question
was whether the order of the Minister was a quasi-judicial act or a purely administrative one. Lord
Thankerton pointed out that the duty was purely administrative but the A ct prescribed certain
methods or steps in the discharge of that duty. Before making the draft order, the Minister must
have made elaborate inquiry into the matter and have consulted any local authorities who appear to
him to be concerned and other Departments of the Government. The Minister was required to
satisfy himself that it was a sound scheme before he took the serious step of issuing a draft order.
For, the purpose o f inviting obiections and where they were not withdrawn, of having public inquiry
to be held by someone other than the respondent to whom that person reports, was for the further
information o f the respondent for the final consideration of the soundness of the scheme... Learned
counsel for the respondent referred to several cases but in none of them the dicta of Atkin L.J. or the
four conditions analysed by Slesser L.J. have been suggested, much less stated, to be not the correct
tests. The respondent's argument that whenever there is a determination of a fact which affects the
rights of parties, the decision is quasi-judicial, does not appear to be sound. T he observations of
May C.J., when properly read, included the judicial aspect o£ the determination in the words used by
him. I am led to that conclusion because after the test of judicial duty of the body making the
decision was expressly stated and emphasized by Atkin and Slesser LJJ, in no subsequent decision it
is even suggested that the dictum of May C J. was different from the statement of law of the two
Lord Justices or that the latter, in any way, required to be modified. The word “ quasi-judicial” itself
necessarily implies the existence o f judicial element in the process leading to the decision....
Because .in executive authority has to determine certain objective facts as a preliminary step to the
discharge of an executive function, it does not follow that it must determine those facts judicially. W
hen the executive authority has to form an opinion about an objective patter as a preliminary step to
the exercise of a certainv;B|^!#er conferred:On, it, the determination of th e' objective, exercise" o
f'th e SLCTIOX 4 ] ADMiNiSTRATlVE FUNCTIONS ili3 power based thereon are alike matters of an
admiaistrative character and are not amenable to the writ of certiorari,,.. It seems to me that the
true position is that when the law under which the authority is making a decision, itself requires a
judicial approach, the decision will be quasi-judicial. Prescribed forms of procedure are not
necessary to make an enquiry judicial, provided in coming to the decision the wellrecognised
principles of approach are required to be follow ed.... On behalf of the respondent it was strongly
urged that even applying these tests the decision of the Provincial Government under S.3 is quasi-
judicial. The decision whether the premises were required for a public purpose was contended not
to be a matter of opinion. The power to make inquires under Ss. 10 & 12 were strongly relied upon
in this connection.... Bearing in mind the important factor which distinguishes a quasijudicial
decision from an administrative act, it is next necessary to find out whether the action of the
Provincial Government permitted under S. 2 of the Ordinance, read along with the scheme of the
Ordinance is a quasi-judicial decision or an administrative act.... [I]t is not seriously disputed that the
subjective opinion of the Provincial Government in respect of the order of requisition is not open to
challenge by a writ of certiorari. The Ordinance has left that decision to the discretion of the
Provincial Government and that opinion cannot be revised by another authority. It appears
therefore that except when mala fides are clearly proved, that opinion cannot be questioned. The
next question is whether requirement "for any public purpose” stands on the same footing. On
behalf of the appellant, it was argued that opinion of the Government, that it is necessary ox
expedient to pass an order of requisition, stands on the same footing as its decision on the public
purpose. In the alternative it was urged that the two factors, viz., necessity to requisition and
decision about public purpose, form one composite opinion and the composite decision is the
subjective opinion of the Provincial Government. The third alternative contention was that the
decision of the Government about a public purpose is a fact which it has to ascertain or decide, and
thereafter the order of requisition has to follow. The decision of the Provincial Government as to the
public purpose contains no judicial element in it. Just as the Government has to see that its order of
requisition is not made in respect of land which is used for public religious worship or is not in
respect of land used for a purpose specified by the Provincial Government in the Official Gazette, (as
mentioned in the proviso to S. 3) or that the 104 INDIAN ADMINISTRATIVE LA W [ CHAPTEk 3
premises are vacant on the date when the notification is issued mentioned in S. 4 of the Ordinance),
the Government has to deddc whether a particular object, for which it is suggested that land should
be requisitioned, was a public purpose. In my opinion, third alternative contention is clearly corrcct
and it is unnecessary therefore to deal with the first two arguments. There appears nothing in the
Ordinance to show that in arriving at its decision on this point the Provincial Government has to act
judicially. Sections 10 and 12, which were relied upon to show that the decision was quasi-judicial, in
my opinion, do not support the plea. The inquiries mentioned in those sections are only permissive
and the Government is not obliged to make them. Moreover, they do not relate to the purpose for
which the land may be required, They are in respect of the condition of the land and such other
matters affecting land. Every decision of the Government, followed by the exercise of certain power
given to it by any law is not necessarily judicial or quasi-judicial. The words of S. 3 read with the
proviso, and the words of S. 4 taken along with the scheme of the whole Ordinance, in my opinion,
do not import into the decision of the public purpose the judicial element required to make the
decision judicial or quasijudicial. The decision o f the Provincial Government about public purpose is
therefore an administrative act,... MtikherjeaJ. (dissenting) ....Every judicial act presupposes the
application of judicial process. There is a well-marked distinction between forming a personal or
private opinion about a matter, and determining it judicially. In the performance of an executive act,
the authority has certainly to apply his mind to the materials before him; but the opinion he forms is
a purely subjective matter which depends entirely upon his state of mind. It is of course necessary
that he must act in good faith, and if it is established that he was not influenced by any extraneous
consideration, there is nothing further to be said about it. In a judicial proceeding, on the other
hand, the process or method of application is different. “ The judicial process involves the
application of a body of rules or principles by the technique of a particular psychological method,
Robion’s Justice and Administr^fitfe Law p. 33." It involves a proposal and an opposition, and arriving
at a decision upon the same on consideration of facts and, OBS^Itaastaixces according to the rules of
reason and justice,... It mmt be somelliing which conforms to an objective standard or laid down or
recognised by law, and the soundness ;^r;?:&therwise of the SECTION 4 J ADMINISTRATIVE
FUNCTIONS 105 determination must be capable of being tested by the same external standard. ,..
[T]he general rule...is that if the foundation o f the exercise of powers by an authority is his personal
satisfaction or subjective opinion about certain facts, the function is to be regarded as executive and
not judicial. The facts may undoubtedly be and often are objective facts about which the authority
has got to form his opinion. W hen a statute says that a Minister can requisition property or order
compulsory purchase if he deems it expedient to do so in the interest of public safety or the defence
of the realm, the condition precedent to the exercise of the powers is not the actual existence of
national interest, but his own opinion or belief that it exists.... On the other hand, if the statute
imposes an objective condition precedent of fact to the exercise of powers by an authotity, and not
merely his subjective opinion about it, the function would be prima facie judicial-... The language of
the Section [3 of the Bombay Land Requisitioning Ordinance, 1947]...indicates in my opinion, that
whereas the act of requisitioning land is left to the executive discretion of the Provincial Government
and the latter can requisition land whenever it considers necessary or expedient to do so, certain
conditions have been laid down which are conditions precedent to the exercise of the powers. The
first condition is specified in the section itself and it postulates the existence of a public purpose as
an essential prerequisite to the taking of steps by the Provincial Government in the matter of
requisitioning any property. Even where this condition is satisfied, there is another condition
imposed by the proviso which is in the nature of an exception engrafted upon the entire section and
which prevents the Provincial Government from exercising its powers at all if the land sought to be
requisitioned is used for public religious worship or for any other purpose which the Provincial
Government has specified in the official gazette. Ill my opinion the existence of a public purpose as
an objective fact, and not the subjective opinion of the Provincial Government that such fact exists,
has been made the essential preliminary which founds the jurisdiction of the Provincial Government
to proceed with any act of requisition. Provincial Government has to satisfy itself that there is a
public purpose before it proceeds to requisition any property. As this is an objective condition which
has not been made dependent on the 106 INDIAN ADMINISTRATIVE LA W [ CHAPTER 3 personal
opinion of tlic Executive it has got tc be deterniiiied ju dicially and whether a public purpose exists or
not is itself a n!i;:ed question of facts and law which could be determined by application of well
established principles of law’ to the circumstances or a particular case. There is undoubtedly a & or
point in controversy— or what is called a proposal and an opposition. On the one hand there is the
interest of the public and on the other, the interest of the individual whose property is being
requisitioned. N o formal array of parties is necessary. It is enough that there is a point in issue which
has got to be decided between parties having conflicting interests in respect to the same. The fact
that the Provincial Government represents the interests of the public also is to my mind immaterial.
If there is a duty to decide judicially, it would be a judicial act and it is not necessary that there must
be two opposing parties other than the deciding authority appearing in a regular or formal manner.
Das, J. (Concurring) ...Thus a person entrusted to do an administrative act has often to determine
questions of fact to enable him to exercise his power. H e has to consider facts and circumstances
and to weigh pros and co n s in his mind before he makes up his mind to exercise his power just as a
person exercising a judicial or quasi-judicial function has to do. Both have to act in good faith. A good
and valid administrative or executive act binds the subject and affects his rights or imposes liability
on him just as effectively as a quasi-judicial act does. The exercise of an administrative or executive
act may well be and is frequently made dependent by the Legislature upon a condition or
contingency which may involve a question of fact, but the question of fulfilment of which may,
nevertheless, be left to the subjective opinion or satisfaction of the executive authority.... The first
two items of the definition given by AtMn L.J., may be equally applicable to an administrative act.
The real test which distinguishes a quasijudicial act from an administrative act is the third item in
Atkin L.J.’s definition, namely, the duty to act, judicially..,. Therefore, in considering whether a
particular statutory authority is quasi-judie|^J body or a mere administrative body it has to be
ascertained wbetmr, the statutory authority has the duty to act judicially. A n examination o f the
decided cases shows that in many of them where the statutory bodies were held to be quasi-judicial
bodies and their decisions were regarded as quasi-judicial ac]^^ there were parties opposing such
claim and the statutory authority SECTION 4 ] ADMlSiSTRATfVE FUNCTIONS 107 empowered to
adjudicate upon the matters in issue between the parties and to grant or refuse the claim.... This
definition of quasi-judicial decision clearly suggests that there must be two or more contesting
parties and an outside authority to decide those disputes.... On the other hand there are many cases
where the act of a statutory authority has been accepted as a quasi-judicial act, although there were
not two opposing parties over whose disputes the authority was to sit in judgement, In those cases it
was the authority who made a proposal and another person objected to it and the authority itself
was entrusted to hear the objection and give a decision on it. In short the authority which was the
proposer was the judge in its own cause. The only ground on which the decision of such an
authority, placed in such situation as I have just mentioned, was regarded as quasi-judicial act was
that the authority was empowered to affect the rights of or impose a liability on others and was
required by the very law which constituted it to act judicially.... ...The principles, as I apprehend
them are: (i) that if a statute empowers an authority, not being a Court in the Ordinary sense, to
decide disputes arising out of a claim made by one party under the statute which claim is opposed
by another party and to determine the respective rights of the contesting parties who are opposed
to each other there is lis and prima facie, and in the absence of anything in the statute to the
contrary it is the duty of the authority to act judicially and the decision of the authority is a quasi-
judicial act; and (ii) that if a statutory authority has power to do any act which will prejudicially affect
the subject, then, although there are not two parties apart from the authority and the contest is
between the authority proposing to do the act and the subject opposing it, the final determination
of the authority will yet be a quasi-judicial act provided the authority is required by the statute to act
judicially. In other words, while the presence of two parties besides the deciding authority will prima
facie and in the absence of any other factor impose upon the authority the duty to act judicially, the
absence of two such parties is not decisive in taking the act o f the authority out of the category o f
qua si-judicial act if the authority is nevertheless required by the statute to act judicially.... [The
concurring opinion of Fazal Ali, J. and dissenting opinion of Mahajan, J. have been omitted.]' 108 In d
ia n ADMINISTRATIVE LAW [CHAPTERS NAGENDRA NATH BORA t, COMME,, HILLS DIVISION A J.R.
I95S S. C. 398 [The Eastern Bengal and Assam Excise A ct regulates the sale of countrj" spirit in non-
prohibited areas in the State of Assam by licences issued by authorities under the A ct. Shops are
settled for sale of liquor for one year. In accordance with the rules framed under the A ct, tenders
were invited by the Deputy Commissioner o f Sibsagar in 1956, for the settlement of Jorhat country
spirit shop for the year 1957-58. The appellant Nagendranath and the respondent Dharmeshwar
submitted tenders. The Deputy Commissioner, in consultation with the local Advisory Committee,
settled the shop with Dharmeshwar. Nagendra's tender was not even considered by him.
Thereupon, Nagendra preferred an appeal to the Excise Commissioner, who, setting aside the
settlement in favour of Dharmeshwar, ordered settlement of the shop in favour of the Appellant.
The Commissioner of Hills Division and Appeals, Assam, acting as the Excise Appellate Authority, to
whom Dharmeshwar had appealed against the order of the Excise Commissioner, dismissed the
appeal and confirmed the order setting the shop with the Appellant. Dharmeshwar then moved the
Assam High Court under Articles 226 and 227 o f the Constitution for an appropriate writ for
quashing the order of the Commissioner of Hills Division and Appeals, The High Court quashed the
order holding that the Commissioner had acted in excess of his jurisdiction, that his order was
vitiated by errors apparent on the face of record, and directed that all the tenders be reconsidered
in the light of the observations made by it. Against the order of the High Court the Appellant filed an
appeal to the Supreme Court by special leave. Section 9 of the Act'^ runs as follows : “9. (1) Orders
passed under this A ct or under any rule made hereunder shall be appealable as follows in the
manner prescribed by such rules as the State Government m ay; make in this behalf: (a) to the Excise
Commissioner, any order passed by the District Collector or a Collector Other than the District
Collector. 2, As amended in 1955. SECTION 4 ] a d m in is t r a t iv e ruxcnoss 109 (b) to the Appellate
Authority appointed by the State Government for the purpose, any order passed by the Excise
Commissioner, (2) In cases not provided for by clauses (a) and (b ) of subsection (1) orders passed
under this A ct or under any rules made thereunder shall be appealable to such authorities as the
State Government may prescribe. (3) The Appellate Authority, the Excise Commissioner or the
District Collector may call for the proceedings held by any officer or persons subordinate to it or him
or subject to its or his control and pass such orders thereon as it or he may think fit.” ] Sinha J. (as he
then was) ; According to the present practice contained in Executive Instructions, intending
candidates for licences, have to submit tenders to the Deputy Commissioner for the Sadar Division
and to the SubDivisional Officers for Sub-Divisions in accordance with the terms of notices published
for the purpose. Such tenders are treated as strictly confidential. Settlement is made by the Deputy
Commissioner or the Sub-Divisional Officer concerned, as the case may be, in consultation with an
Advisory Committee consisting of 5 local members or less. The selection of a particular tender is
more or less a matter of administrative discretion with the officer making the settlement..., ...A t the
forefront of the arguments advanced on behalf of the Appellate Authority, was the plea that the
several authorities already indicated concerned with the settlement o f excise shops like those in
question in these appeals, are merely administrative bodies, and, therefore, their orders whether
passed in the first instance or on appeal, should not be amenable to the writ jurisdiction or
supervisory jurisdiction of the High Court under Arts. 226 and 227 of the Constitution.... It is true
that no one has an inherent right to settlement of liquor shops,® but when the State, by public
notice, invites candidates for settlement to make their tenders, and in pursuance of which notice, a
number of persons make such tenders each one makes a claim for himself in opposition to the
claims of the others, and public authorities concerned with the settlement have to choose from
amongst them. 3. Cooverji B. Bharucha v. Excise Commissioner and the Chief Commissioner, Ajmer.
A.I.R. f954 S. C. 220; State o f Assam v. A, N. Kidwai, A.l.R. 1957 S. C. 414. 110 INDIAN
ADMINISTRATIVE LAW [CHAPTERS If the choice has rested in the hands of only one authority like the
District Collector on his satisfaction as to the fitness of a particular candidate without his orders
being amenable to an appeal or appeals or rtn^ision, the position may have been different. But S- 9
of the A ct has laid down a regukr hierarchy of authorities, one above the other, with the right of
hearing appeals or revisions. Though the Act and the rules do not, in express terms, require
reasoned orders to be recorded, yet, in the context of the subject matter of the rules, it becomes
necessary for the several authorities to pass what are called ‘speaking orders'. W here there is a right
vested in an authority created by statute, be it administrative or quasi-judicial, to hear appeals and
revisions, it becomes its duty to hear judicially, that is to say, in an objective manner, impartially and
after giving reasonable opportunity to the parties concerned in the dispute, to place their respective
cases before it. In this connection the observations of Lord Haldane at p. 132, and of Lord M oulton
at p. 150, in Local Government Board v. Arlidge, 1915 A.C. 120 to the following effect are very
apposite : LO RD H A L D A N E : “ M y Lords, when the duty of deciding an appeal is imposed, those
whose duty it is to decide it must act judicially. They must deal with the question referred to them
without bias, and they must give each of the parties the opportunity of adequately presenting the
case made. The decision must be come to in the spirit and with the sense of responsibility o f a
tribunal whose duty it is to mete out justice. But it does not follow that the procedure of every such
tribunal must be same.” LO RD M O U L T O N • “ In the present case, however, the Legislature has
provided an appeal, but it is an appeal to an administrative department of State and not to judicial
body. It is said, truthfully, that on such an appeal the Local Government Board must act judicially,
but this, in my opinion, only means that it must preserve a judicial temper and perform its duties
conscientiously with a proper feeling of responsibility in view of the fact that its acts affect the
property and right of individuals. Parliament has wisely laid down certain rules to be observed in the
performance o f its fuctions in these matters, and those rules must be observed because they are
imposed by statute, and for no other reason, and whether they give much or little opportunity for
what I may call quasi-Htigious procedure depends solely on what Parliament has thought right.
These rales are beyond the criticism of the Courts, and it is not their business to add or to take away
from them, or even to discuss whether in the opinion of the individual members of the Court they
are adeqm te or n o t/' SrCTIOX 4 ] A DMIMSTRATIVE FUNCTIONS 111 The legal position has been
very succinctly put in Halsbury’s Laws of England V ol. II 3rd Edn. pp 56-57 as follow s; “ M oreover,
an administrative body whose decision is actuated in whole or in part by questions of policy, may be
under a duty to act judicially in the course of arriving at that decision. Thus, if in order to arrive at
the decision, the body concerned had to consider proposals and obiections and consider evidence, if
at some stage of the proceedings leading up to the decision there was something in the nature of lis
before it, then in the course of such consideration and at that stage the body would be under a duty
to act judicially. If, on the other hand, an administrative body in arriving at its decision has before it
at no stage any form of lis and throughout has to consider the question from the point of view of
policy and expediency it cannot be said that it is under a duty at any time to act judicially. Even
where the body is at some stage of the proceedings leading up to the decision under a duty to act
judicially, the supervisory jurisdiction of the Court does not extend to considering the sufficiency of
the grounds forj or otherwise challenging, the decision itself." The provisions of the A ct are intended
to safeguard the interest ' of the State on the one hand, by stopping, or at any rate, checking illicit
distillation, and on the other hand, by raising the maximum . revenue consistently with the
observance of the rules o f temperance. The authorities under the A ct, with Sub-Divisional Officers
at the bottom and the Appellate Authority at the apex of the hierarchy, are charged with those
duties. The rules under the A ct, and the executive instructions which have no statutory force but
which are meant for the guidance of the officers concerned, enjoin upon those officers, the duty of
seeing to it that shops are settled with persons of character and experience in the line, subject to
certain reservations in favour of tribal population. Except those general considerations, there are no
specific rules governing the grant of leases or licences in respect of liquor shops, and in a certain
contingency, even drawing of lots is provided for^..-. The words of sub-s. (3) of S. 9. set out above,
vest complete discretion in the Appellate Authority, the Excise Commissioner or the District
Collector, to pass such orders thereon '• 3S it or he may think fit . The sections of the A ct do not
make any ' reference to the recording of evidence or of hearing of parties or even .'recording
reasons for orders passed by the authorities aforesaid. But we have been informed at the bar that as
a matter of practice, the 4- Vide Executive Instruction 110 at p. 174 of the Manual, 112 INDIAN
ADMINISTRATIVE LA W [ CHAPTER 3 authorities under the A ct, hear counsel for the parties, and give
reasoned judgements, so as to enable the higher authorities to know why a particular choice has
been made. That is also apparent from the several orders passed by them in course of these few
cases that are before us. But when w e come to the rules relating to appeals and revisions, we find
that the widest scope for going up in appeal or revision, has been given to persons interested,
because R. 344 only lays down that no appeal shall lie against the orders of composition, thus,
leaving all other kinds of orders open to appeal or revision. Rule 343 provides that every
memorandum of appeal shall be presented within one month from the date of the order appealed
against, subject to the requisite time for obtaining a certified copy of the order being excluded.®
Rule 344 requires the memorandum of appeal to be accompanied by a certified copy of the order
appealed against. The memorandum of appeal has to be stamped with a requisite court fee stamp....
These rules...set out above, approximate the procedure to be followed by the Appellate Authorities,
to the regular procedure observed by courts of justice in entertaining appeals... the ultimate
jurisdiction to hear appeals and revisions was divided between the Assam High Court and the A
uthority.... Appeals and revisions arising out of cases covered by provisions of the enactments®
specified in Schedyle ‘A ' to that A ct, were to lie in and to be heard by the Assam High Court, and the
jurisdiction to entertain appeals and revisions in matters arising under the provisions of the
enactments specified in Schedule ‘B ’ to that A ct, was vested in the Authority to be set up under S.
3(3), that is to say, for the purposes of the present appeals before us, the Excise Appellate Authority.
Thus, the Excise Appellate Authority, for the purposes of the cases arising under the A ct, was vested
with the pow er of the highest appellate Tribunal, even as the H igh Court was, in respect of the
other group of cases. That does not necessarily mean that the Excise Appellate Authority was a
Tribunal of co-ordinate jurisdiction with the High Court, or that authority was not amenable to the
supervisory jurisdictipn o t High Court under Arts. 226 and 227 of the Constitution. But t f e 5. The
Appellate Authority was, however, empowered to admit the appeal after the prescribed period of
limitation when appellant satisfied it that he had stiflBcient cause for not preferring the appeal
within such period, (EdO. : , 6. Assam Revenue Tribunal (Transfer of Powers) Act, 1948; o f Assam A,
N 1957 S, C, R. 295, 304, SECTION 4 ] ADMimSTRATIVE FUNCTIONS 113 juxtaposition of the two
parallel highest Tribunals, one in respect of predominantly civil cases, and the other, in respect of
predominantly revenue cases, (without attempting any clear outline of demarcation), would show
that the Excise Appellate Authority was not altogether an administrative body which had no judicial
or quasi-judicial functions. Neither the A ct nor the rule made thereunder, indicates the grounds on
which the first Appellate Authority, namely, the Excise Commissioner, or the Second Appellate
Authority (The Excise Appellate Authority), has to exercise his or its appellate or revisional powers.
There is no indication that they make any distinction between the grounds of interference on appeal
and in revision. That being so, the powers of the Appellate Authorities, in the matter of settlement,
would be co-extensive with the powers of the primary authority, namely, the District C ollector or
the Sub-Divisional Officer. See in this connection the observations of the Federal Court in
Lachmeshwar Prasad Shukul y. Keshwar Lai Chaudhari, 1940 F .p.R . 84 at p. 102: (A.I.R. 1941 F.C. 5
at p. 13) and of this Court in Ebrahim Aboobakar v. Custodian-General o f Evacuee Property, 1952
S.C.R. 626 at p. 704: (A.I.R. 1952 S.C. 319 at p. 322). In the latter case, this court, dealing with the
powers of the Tribunal (Custodian-General of the Evacuee Property) under S. 24 of Ordinance N o.
27 of 1946, observed : “ Like all courts of appeal exercising general jurisdiction in civil cases, the
respondent has been constituted an appellate court in words of the widest amplitude and the
legislature has not limited his jurisdiction by providing that such exercise will depend on the
existence of any particular state of facts.” Thus, on a review of the provisions of the A ct and the
rules framed thereunder, it cannot be said that the authorities mentioned in S. 9 of the A ct pass
purely administrative order which are beyond the ambit of the High Court’s power of supervision
and control.... 114 INDIAN ADMINISTRATIVE LAW [CHAPTERS SHIVAJI NATHUBHAI v. UNION OF
INDIA A.I.R, 1960 S.C. 605, [The State of Orissa granted the mining leases of five areas to the
appellant. The third respondent, who had also appHed for mining leases of some of those areas and
was not given any, appHed for reyiew tg tlie Central Gpvernm^nt upder Rule 52 qf the Mineral
Concession Rules, 1949, framed under section 6 of the Mines and Minerals (Regulation and
Developm ent) A ct, 1948. The Central Government allowed the review application and directed
Orissa Government to grant a mining lease to the third respondent with respect to two out of the
five areas given to the appellant. The appellant complained that the Central Government decided
the matter without giving him a hearing. The rules relevant for the purpose are Rules 52 to 55. Rule
52, inter alia^ provided that any person aggrieved by an order of the State Government refusing to
grant a mining lease may within tw o months of the date of such order apply to the Central
Government for reviewing the same. Rule 53 prescribed a fee. Rule 54 ran : “ Upon receipt of such
application, the Central Government may, if it thinks fit, call for the relevant records and other
information from the State Government and after considering any explanation that may be offered
by the State Government, cancel the order of the State Government or revise it in such manner as
the Central Government may deem just and proper.” Rule 55 made the order of the Central
Government under Rule 54, and subject only to such order, any order of the State Government
under these rules, final. The basic question which arose for consideration was whether an order of
the Central Government under Rule 54 was quasi-judicial or administrative.] Wanchoo, J. ; This Court
had occasion to consider the nature of the two kinds o f acts, namely judicial which includes quasi-
judicial and adm inis-. trative, a number of times. In Province o f Bombay v. Khusaldas S. Admni,
1950 S.C.R. 621 (A.I.R.1950 S.C.222) it adopted the celebrated definirion of a quasi-judicial body
given by Atkin L. J. in R- vElectricity Commissioners, 1942-1 K. B. 171.... A fter analysing the various
cases, Das, J. (as he then was) laid down the following principles as deducible therefrom in Khusaldas
S. Advani’s Case (supra) at p. 725 of S .C .R .; (at p. 260 of A .I.R ...) It is on these principles that we
have to see whether the Central Government when acting under Rule 54 is acting in a quasijudicial
capacity or otherwise.... Mr. Pathak contends that there is no right in favour o£ the person to whom
the lease has been granted by the State Gov^rjiinerit till the Central Government has passed an
prder pn a application^ if SECTION 4 ] ADMINISTRATIVE FUNCTIONS 115 any. Rule 55, however,
makes it clear that the order of State Government is final subject to any order on review by the
Central Government under Rule 54, N ow when a lease is granted by the State Government, it is
quite possible that there may be no application for review by those whose applications have been
refused. In such a case the order of the State Government would be final. It would not therefore be
in our opinion right to say that no right of any kind is created in favour of a person to whom the
lease is granted by the State Government. The matter would be different if the orders of the State
Government were not to be effective until confirmation by the Central Government. But Rule 54
does not provide for confirmation by the Central Government. It gives power to the Central
Government to act only when there is an application for review before it under Rule 54. That is why
we have not accepted Mr. Pathak’s argument that in substance the State Government's order
becomes effective only after it is confirmed; Rule 54 does not support this. W e have not found any
provision in the Rules or in the A ct which gives any power to the Central Government to review suo
motu the order of the State Government granting a lease. That some kind of right is created on the
passing of an order granting a lease is clear from the facts of this case also,... A t any rate, when the
statutory rule grants a right to any party aggrieved to make a review application to the Central
Government it certainly follows that the person in whose favour the order is made has also a right to
represent his case before the authority to whom the review application is made. It is in the
circumstances apparent that as soon as Rule 52 gives a right to an aggrieved party to apply for
review a Us is created between him and the party in whose favour the grant has been made. Unless
therefore there is anything in the statute to the contrary it will be the duty of the authority to act
judicially and its decision would be a quasi-judicial act. The next question is whether there is
anything in the Rules which negatives the duty to act judicially by the reviewing authority. Mr.
Pathak urges that Rule 54 gives full power to the Central Government to act as it may deem “ just
and proper” and that it is not bound even to call for the relevant records and other information from
the State Government before deciding an application for review. That is undoubtedly so. But that in
our opinion does not show that the statutory rules negative the duty to act judicially. W hat the
Rules require is that the Central Government should act justly and properly: and that is what an
authority which is required 116 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3 to act judicially must do.
The fact that the Central Government is not bound even to call for records again does not negative
the duty cast upon it to act judicially, for even courts have the power to dismiss appeals without
calling for records. Thus Rule 54 lays down nothing to the contrary. W e are therefore o f opinion
that there is prima facie a Us in tjiis case as between the person to whom the lease has been granted
and the person who is aggrieved by the refusal and therefore prima facie it is the duty of the
authority which has to review the matter to act judicially and there is nothing in Rule 54 to the
contrary. It must therefore be held that on the Rules and the A ct, as they stood at the relevant time,
the Central Government was acting in a quasi-judicial capacity while deciding an application under
Rule 54, A s such it was incumbent upon it before coming to a decision to give a reasonable
opportunity to the appellant, who was the other party in the review application whose rights were
being affected, to represent his case. Inasmuch as this was not done, the appellant is entitled to ask
us to issue a writ in the nature of certiorari quashing the order... passed by the Central Governm
ent... ...It will, however, be open to the Central Government to proceed to decide the review
application afresh after giving a reasonable opportunity to the appellant to represent his case....
SECTION 4 ] ADMINISTRATIVE FUNCTION 117 SHANKERLAL v. SHANKERLAL A.l.R. 1965 S.C. 507. [A
company incorporated under the Indian Companies Act, 1913, was carrying on business at Calcutta.
On a petition of the first Respondent, the High Court of Calcutta ordered the company to be wound
up compulsorily. In the course of winding up, the official Hquidators sought the confirmation by the
company Judge of the High Court, of the auction sale of certain assets of the company to the
appellant. The sale was confirmed. On appeal, the Division Bench of the High Court set aside the
order confirming the sale. It was from that order that the appeal was preferred by special leave. The
principal question that was raised in the appeal was whether the order of the company Judge
confirming the sale under Section 179 o f the Indian Companies A ct, 1913 was administrative or
quasi-judicial. Section 179 of the Indian Companies A ct, 1913 provides: “ Powers of official liquidator
— The official liquidator shall have power, with the sanction of the Court, to do the;following thing:
(c) to sell the immoveable and moveable property of the company by public auction or private
contract, with power to transfer the whole thereof to any person or company or to sell the same in
parcels.” Section 183 of the A ct makes provision for the exercise of control by the court over the
liquidator and sub-section ( 3 ) enables the liquidator to apply to the court for directions in relation
to any particular matter arising in winding up. Section 184 requires the court to cause the assets of
the company to be collected and appHed in the discharge of its liabilities.] Ayyangar, J. On the basis
of these provisions, we shall proceed to consider whether the confirmation of the sale was merely
an order in the course of administration and not a judicial order. The sale by the liquidator was, of
course, effected in the course of the realisation of the assets of the company and for the purpose of
the amount realised being apphed towards the discharge of the liabilities and the surplus to be
distributed in the manner provided by the A ct. It would also be correct to say that when a liquidator
effects a sale he is not discharging any judicial function. Still it does not follow that every order of the
Court merely for the reason that it is passed in the course of the realisation of the assets of the
company must always be treated as merely an administrative one. The question ultimately depends
upon the nature of the order that is passed. A n order according sanction to a sale undoubtedly
involves a discretion and cannot be termed merely a ministerial order, for before confirming the sale
the Court has to be satisfied, particularly where the confirmation is opposed, that the sale has been
held in accordance with the conditions subject to which alone the Hquidator has been permitted to
effect it, and that even otherwise the sale has been fair and has not resulted in any loss to the
parties who would ultimately have to share the realisation. The next question, is whether such an
order could be classified as an administrative order. One thing is clear, that the mere fact that the
order is passed in the course of the administration of the assets of the company and for realising
those assets is not by itself sufficient to make it an administrative, as distinguished from a judicial
order. For instance, the determination of amounts due to the company from its debtors which is also
part of the process of the realisation of the assets of the company is a matter which arises in the
course of the administration. It does not on that account follow that the 118 INDIAN a d m in is t r a t
iv e LA W [ CHAPTER J determination of the particular amount due from a debtor who is brought
before the Court is an administrative order. It is perhaps not possible to formulate a definition which
would satisfactorily distinguish, in this context, between an administrative and a judicial order. That
the power is entrusted to or wielded by a person who functions as a Court is not decisive of the
cjuestion whether the act or decision is administrative or judicial. But we conceive that an
administrative order would be one which is directed to the regulation or supervision of matters as
distinguished from an order which decides the rights o f parties or confers or refuses to confer rights
to property which are the subject of adjudication before the Court. One of the tests would be
whether a matter which involves the exercise of discretion is left for the decision of the authority,
particularly if that authority were a Court, and if the discretion has to be exercised on objective, as
distinguished from a purely subjective, consideration, it would be a judicial decision. It has
sometimes been said that the essence of a judicial proceeding or of a judicial order is that there
should be tw o parties and a lis between them which is the subject of adjudication, as a result of that
order or a decision on an issue between a proposal and an opposition... N o doubt, it would not be
possible to describe an order passed deciding a lis before the authority, that it is not a judicial order
but it does not follow that the absence of a lis necessarily negatives the order being judical. Even
viewed from this narrow stand point it is possible to hold there was a lis before the Company Judge
which he decided b y passing the order. On the one hand were the claims of the highest bidder who
put forward the contention that he had satisfied the requirements laid down for the acceptance of
his bid and was consequently entitled to have the sale in his favour confirmed, particularly so as he
was supported in this behalf by the official liquidators. On the other hand there was the 1st
respondent and not to speak of him the large body of unsecured creditors whose interests, even if
they were not represented by the 1st respondent, the Court was bound to protect. If the sale of
which confirmation was sought was characterised by any deviation from the conditions subject to
which the sale was directed to he held or even otherwise was for a gross undervalue in the sense
that very much more could reasonably be expected to be obtained if the sale were properly held... it
would be the duty of the Court to refuse the confirmation in the interests of the general body o f
CLeditors and this was the submission made by the 1st respondent. There were thus SECTION 4 ]
AbMINISfRATIVE FUNCTIONS 119 tw o points of view presented to the Court by tw o contending
parties or interests and the Court was called upon to decide betw een them. A nd the decision vitally
affected the rights of the parties to property. In this view we are clearly of the opinion that the order
of the Court was, in the circumstances, a judicial order and not an administrative one and was
therefore not inherently incapable of being brought up in appeal. 120 INDIAN ADMINISTRATIVE LAW
[ CHAPTER 3 GULLA.PALLI NAGESHWARA RAO v. A.P.S.R.T. CORPN. A.I.R. 1959 S.C. 308. [In exercise
of the powers conferred by Section 68 (c ) of the M otor Vehicles A ct, 1939 (as amended by A ct 100
of 1956) General Manager of the State Transport Undertaking of the Andhra Pradesh Road
Transport, published a scheme for the purpose of providing an efBcient, adequate, economical and
properly coordinated transport service mentioned therein with effect from the date notified by the
State Government. Thereafter, the petitioners filed objections before Secretary to Government,
Transport Department. Individual notices were issued by the Government fixing the date of the
hearing. The Secretary to the Government, Hom e Department, incharge of Transport, heard the
representations made by the objectors, and also the representation made by the General Manager
of the Road Transport Undertaking. The Secretary, after hearing the objections, ■prepared notes
and placed the entire matter with his notes before the Chief Minister, who considered the matter
and passed orders rejecting the objections and approving the Scheme. The approved scheme was
issued in the name of the Governor. The petitioners, who had been carrying on motor transport
business in Krishna District for several years, approached the Supreme Court under article 32 of the
Constitution for the enforcem ent of their fundamental right to carry on the business of M otor
transport. The decision of the Government was challenged on several grounds. The basic question
involved was whether the State Government in approving the scheme was discharging a quasi-
judicial or an administrative act. The relevant sections of the M otor Vehicles A ct, and rules
thereunder are as follows: Definitions: In this Chapter, unless the context otherwise requires,— (a)
“road transport service” means a service of motor vehicles carrying passengers or goods or both by
road for hire or reward; (b) ‘‘State transport undertaking” means any undertaking providing road
transport service, where such undertaking is carried on by,— (i) the Central Government or a State
Government; (ii) any Road Transport Corporation established under section 3 of the Road Transport
Corporations A ct, 1950; (iii) the Delhi Road Transport A uthority established under section 3 of the
Delhi Road Transport Authority A ct, 1950; (iv) any municipality or any corporation or company
owned or controlled by the State Government. Section 68-C :— Preparation and publication of
scheme of road transport service of a State transport undertaking. W here any State transport
undertaking is of opinion that for the purpose of providing an efficient, adequate, economical and
properly co-ordinated road transport service, it is necessary in the public interest that road transport
services in general or any particular class o f such service in relation to any area or route or portion
thereof should be run and operated by the State transport undertaking whether to the exclusion,
complete or partial, of other persons or otherwise, the State transport undertaking may prepare a
scheme giving particulars of the nature of the services proposed to be rendered, the area or route
proposed to be covered and such other particulars respecting thereto as may be prescribed; and
shall cause every such scheme to be published in the Official Gazettee and also in such other manner
as the State Government may direct. Section (55-i).*— O bjection to the scheme. (1) A ny person
alEfected by the schem e published under section 68~C may, within thirty days from the date of the
publication of the scheme in t|ip^Official Gazette, file objections thereto before the State
Government. (2) The State Government may, after considering the objectfons and after giving an
opportunity to the objector or his representatiyes and the representatives of the State transport
undertaking to be heard in the matter, if they so desire, approve or modify the scheme., (3) The
scheme as approved or modified under . sut>;csectioii (2) shall then be published in the Official
Gazette by the State Government and same shall thereupon becom e final and shall be SECTION 4 J
ADMINISTRATIVE FUNCTIONS 111 called the approved scheme and the area of route to which it
relates shall be called the notified area or notified route : Provided that no such scheme which
relates to any inter-State route shall be deemed to be an approved scheme unless it has been
published in the Official Gazette with the previous approval of the Central Government. Rule 8 :
Filing of objections (procedure);— Any person concerned or authority aggrieved by the scheme
published under S. 68-C may, within the specified period, file before the Secretary to Government in
charge of Transport Department, objections and representations in writing setting forth concisely
the reasons in support thereof. Rule 9 : Conditions for submission of objections:— No representation
or objection in respect of any scheme published in the Official Gazette shall be considered by the
Government unless it is made in accordance with rule 8. Rule 10 : Consideration of scheme
(Procedure regarding) : ‘ After the receipt of the objections referred to above, the Government may,
after fixing the date, time and place for holding an enquiry and after giving, if they so desire, at least
seven clear days’ notice of such time and place to the persons who filed objections under rule 8,
proceed to consider the objections and pass such orders as they may deem fit after giving an
opportunity to the person of being heard in person or through authorised representatives.] . Suhba
Rao^ J. The aforesaid three decisions'^ lay down that whether an administrative tribunal has a duty
to act judicially should be gathered from the provisions o f the particular statute and the rules made
thereunder, and they clearly express the view that if an authority is called upon to decide respective
rights of contesting parties or, to put it in other words, if there is a lis, ordinarily there will be a duty
on the part of the said authority to act judicially. Applying the aforesaid test, let us scrutinize the
provisions of Ss. 68~C and 68-D and the relevant rules made under the A ct to ascertain whether
under the said provisions the State Government performs a judicial act or an administrative one.
Section 68-C may be divided into three parts: (i) The State 7. Province of Bombay v. Khushaldas
Advani, A.I.R. 1950 S, C. 222; Nagendra Nath Bora v. Commr. o f Bills Division, A.I.R. 1958 S.C. 398;
Express Newspapers Lid. V . Union o f India, A.I.R. 1958 S.C. 875. (Ed.). m INDIAN ADMINISTRATIVE
LAW [ CftAPTER i Transport Undertaking should come to an opinion that it is necessary in public
interest that the road transport service in general or any particular class of such service in relation to
any area or route or portion thereof should be run or operated by the State Transport Undertaking,
whether to the exclusion, complete or partial, of other persons or otherwise; (ii) it forms that
opinion for the purpose of providing an efficient, adequate, economical and properly co-ordinated
road transport service; and (iii) after it conies to that opinion, it prepares a scheme giving particulars
of the nature of the services proposed to be rendered, area or route proposed to be covered and
such other particulars respecting thereto as may be prescribed and cause it to be published in the
Official Gazette. The section, therefore, makes a clear distinction between the purposes for which a
scheme is framed and the particulars of the schemes. To state it differently, though the purpose is to
provide an efficient, adequate, economical and co-ordinated road transport service in public
interest, the scheme proposed may affect individual rights such as the exclusion, complete or partial,
of other persons or otherwise, from the business in any particular route or routes. Under S.68-C,
therefore, the State Transport Undertaking may propose a scheme affecting the proprietary rights of
individual permit-holders doing transport business in a particular route or routes. The said proposal
threatens the proprietary rights of that individual or individuals. Under S. 68-D read with Rules 8 and
10 made under the A ct, any person affected by the aforesaid proposed scheme may file objections
within the prescribed time before the Secretary of the Transport Department. Under the said
pccovisions, State Government is enjoined to approve or modify the scheme after holding an enquiry
and after giving an opportunity to the objectors or their representatives and the representatives of
the State Transport Undertaking, to be heard in the matter in person or through authorised
representatives. Therefore, the proceeding prescribed is closely approximated to that obtaining in
courts of justice. There are two parties to the dispute. The State Transport Undertaking, which is a
statutory authority under the A ct, theatens to infringe the rights of a citizen. The citizen may object
to the scheme on public grounds or on personal grounds. H e may oppose the scheme on the ground
that it is npt in the interest of the public or on the ground that the route which he is exploiting
should be excluded from the scheme for various reasons. There is, therefore, a proposal and an
opposition and the third party, the State Government is to decide that lis and prima facie jt must do
so judicially. The position is put beyond any doubt by SECTION 4 J ADMINISTRATIVE FUNCTIONS 123
the provision in the A ct and the Rules which expressly require that the State Government must
decide the dispute according to the procedure prescribed by the A ct and the Rules framed
thereunder, after considering the objections and after hearing both the parties. It therefore appears
to us that this is an obvious case where the A ct imposes a duty on the State Government to decide
the act judicially in approving or modifying the scheme proposed by the Transport Undertaking. The
learned Attorney-General argues that Ss. 68-C and 68-D do not contemplate the enquiry in regard to
the rights of any parties, that the schcme proposed is only for the propose of an efficient, adequate,
economical and properly co-ordinated bus transport service and should relate only to that purpose
and that therefore, the enquiry contemplated under S.68-D, though assimilated to a judicial
procedure, does not make the approval of the scheme any the less an administrative act. To put it
shortly, his contention is that the Government is discharging only an administrative duty in
approving the scheme in public interest and no rights of the parties are involved in the process.
There is some plausibility and attraction in the argument, but we cannot accept either the premises
or the conclusions. The scheme proposed may exclude persons, who have proprietary rights in a
route or routes. As we have pointed out, the purpose must be distinguished from the particulars in
the scheme. The scheme propounded may exclude persons from a route or routes and the ajffected
party is given a remedy to apply to the Government and the Government is enjoined to decide the
dispute between the contesting parties. The statute clearly, therefore, imposes a duty upon the
Government to act judicially. Even if the grounds of attack against the scheme are confined only to
the purpose mentioned in S. 68-C wc cannot agree with this contention—the position will not be
different for even in that case there is a dispute between the State Transport undertaking and
persons excluded in respect of the scheme, though the objections are limited to the purpose of the
scheme,... Support is sought to be drawn for this contention from the decision of the House of the
Lords in Franklin v. Minister o f Town and Country Planning, 1948 A.C. 87. A comparison of the
procedural steps under both the Acts^ brings out in bold relief the nature of the enquiries
contemplated under the S. The Motor Vehicles Act, 1939 (as amended by Act 100 of 1956), and the
New Towns Act, 1946 (England). (Ed.). 124 INDIAN ADMINISTRATIVE LA W [ CHAPTER 5 two statutes.
There, there is no lis, no personal hearing and even the public enquiry contemplated by a third party
is presumably confined to the question of statutory requirements or at any rate was for eliciting
further information for the Minister. Here, there is a clear dispute between the two parties. The
dispute comprehends not only objections raised on public grounds but also in vindication of private
rights and it is required to be decided by the State Government after giving a personal hearing and
following the rules of judicial procedure. Though there may be some justification for holding, on the
facts o f the case before the House of Lords that that A ct did not contemplate a judicial act—on that
question we do not propose to express our opinion—there is absolutely none for holding in the
present case that Government is not performing a judicial act. Robson in ‘Justice and Administrative
Law ’, commenting upon the aforesaid decision, makes the following observation at page 533: “ It
should have been obvious from a cursory glance at the N ew Towns A ct that the rules of natural
justice could not apply to the Minister’s action in making an order, for the simple reason that the
initiative’ lies wholly with him. His role is not to consider whether an order made by a local authority
should be confirmed, nor does he have to determine a controversy |)etween a public authority and
private intrerests. The responsibility of seeing that the intention of Parliament is carried out is placed
on him.” The aforesaid observations explain the principle underlying that decision and that principle
cannot have any application to the facts of this case. In ‘Principles of Administrative Law ’, by Griffith
and Street, the following comment is found on the aforesaid decision: After considering the
provisions of S. 1 of the New Towns A ct, 1946, the Authors say— “ Like the town-planning
legislation, this differs from the Housing Acts in that Minister is a party throughout. Further, the
Minister, is not statutorily required to consider the objections. It is obvious, as the statute itself
states, that the creation of new towns is of national interest.” A t page 176, the authors proceed to
state: "Lord Thankerton did not analyse the meanings of ‘judidal* and ‘administrative’ nor did he
specify the particular factors w;hich motived his classification. It is permissible to conclude that he
looked at the A ct as a whole, applying a thee^y of interpretatiori similar to the rvile in Heydori’s
case, 1 5 8 ^ ^ 7b." SECTION 4 J ADMINISTRATIVE FUNCTIONS 125 It is therefore clear that Franklin’s
case., is based upon the interpretation of the provisions of that A ct and particularly on the ground
that object of the enquiry is to further inform the mind of the Minister and not to consider any issue
between the Minister and the objectors. The decision in that case is not of any help to decide the
present case, which turns upon the construction of the provisions of the Act. For the aforesaid
reasons, we hold that the State Government’s order under S. 68-D is a judicial act. Wanchoo, J.
(Dissenting). In the present case, it is urged by...the petitioners that there were two parties before
the State Government, which was the deciding authority under S, 68 D (12), namely, the objectors
and the representative of the State Transport Undertaking. Therefore, according to him, prima facie,
there would be a duty to act judicially and there is no other factor which would take away the
inference to be deduced from the presence of two parties before the State Government, which has
to decide the matter. W hether there is any other factor will, however, depend upon the
circumstances of each case, and the nature of the matter under hearing and the scope of the
hearing. The learned Attorney-General contends that if one looks at the nature of the matter to be
heard and considers the scope of the hearing before the State Government in this case only
conclusion possible is that the State Government acts administratively when it gives a hearing under
section 68(2). W hat then is the nature of the hearing before the State Government? .. .The scheme
which has been published provides that there will be a complete exclusion of citizens when the
scheme is enforced in the area to which it relates. Now, the question is whether the exclusion of
citizens as a whole is also an issue to be decided by the State government when it hears objections.
Mr. Nambiar submits that the most important thing for the State Government to decide is whether
there should be a complete exclusion of citizens on the enforcement of the scheme. The learned
Attorney-General on the other hand contends that all that the State Government has to do is to see
whether the scheme published is in the interest of the public and also whether it will provide an
efficient, adequate, economical and properly co-ordinated road transport service. The argument
continues that if the State Government comes to that conclusion, the complete exclusion which the
scheme provides ipso facto follows, and the State Government has not to decide the matter of
exclusion a separate issue. In other words, the argument is that the State 126 INDIAN A
DMINISTRATIVE LAW [ CHAPTER 3 Government is not to decide between the competing claims of
citizens providing transport privately and the State Transport Undertaking providing transport to the
exclusion of citizens, and there is, therefore, no real lis in this case. It is also pointed out that
objection cannot only be filed by the bus operators of that area who are to be excluded but also by
anybody who is affected by the scheme, including the members of the travelling public. Giving my
best consideration to the arguments on either side on this aspect of the matter, I have come to the
conclusion that the scope of the hearing before the State Government is of a limited character,
though the decision may affect citizens providing transport, the question whether private citizens
should or should not be allowed to provide transport is really not a matter in issue before the State
Government. W hat is in dispute before the State Government, is only whether the scheme that is
proposed by the State Transport Undertaking is an efficient, adequate, economical and properly co-
ordinated scheme for road transport service and whether it is in the interest of the public. If the
State Government comes to the conclusion that it is so, the complete exclusion proposed
automatically follows and the question of exclusion is not to be determined as a separate issue as
between the objectors and the State Transport Undertaking. It is true that the State Government has
the right to modify the scheme and in so doing it may drop a part of the scheme; but here again it is
not modifying the scheme because of any right of a private citizen to carry on road transport service
in a particular area but because it considers that the scheme so far as that particular area is
concerned is not e6ficient, adequate, economical or properly co-ordinated or in the public interest.
Unless it comes to that conclusion with respect to any part of the area comprised in the scheme and
modifies it, the consequence of complete exclusion ipso facto follows. W hat I wish to emphasize is
that the State Government is not determining whether there should be State monopoly or private
enterprise when it is considering objections under S. 69 D (2); it is only deciding whether the scheme
put forward before it is such, as can be approved with or without modifications within four corners
of the law laid down under S. 68 C. If it comes to that conclusion, the complete or partial exclusion
follows. If on the other hand it modifies any part of the scheme, exclusion fails to that extent.
Considering, therefore, the nature and the scope of the hearing under S. 68 D (2) it seems to me that
there is really no lis. Even though there may be two parties before the State; Government the
hearing, there is no detetpwhation ol theright§ SECTION 4 J ADMINISTRATIVE FUNCTIONS 127
before it. The determination is only of the efficiency etc., of the scheme proposed and whether it is
in the public interest. Therefore, it cannot be said that the nature of the hearing in this case makes
the State Government a quasi-judicial tribunal and the decision a quasijudicial act within the
meaning of the principles laid down in Advani s case.... Sifi/ia, J. (Dissenting). The question now
arises whether, in view of the provisions of Chapter IV A ... the determination by the State
Government is judicial or quasi-judicial in character, as contended for the petitioners, or only of an
administrative character, as contended on behalf of the respondents. In order that a determination
may be characterized as judicial or quasi-judicial, it is essential that it should be objective, based on
evidence pro and con (not necessarily given in accordance with the strict rules of evidence) by a
determinate authority who should not have the right to delegate such a function of a judicial
character. Section 68D (2) authorizes the State Government to decide whether or not the proposed
scheme should be approved or modified. The “ State Government” may mean the Governor himself
or any of his Ministers or Deputy-Ministers or any officers in the Secretariat, according to the rules of
business promulgated under Art. 166 of the Constitution. Section 68D (2) could not have meant that
the Governor himself or any of his Minister should personally hear the objections—that would be
throwing too great a burden on them. The objections may be heard by any one who has been
delegated that power. If that is correct, the function to be performed under S. 68D (2), does not
satisfy the test of a Judicial hearing. Under that section, the objections may be heard by ‘A ’ and the
decision arrived at by ‘B'. If that is a regular procedure under that section, that is not an index of a
judicial process. Another very important consideration pointing to the conclusion that the
determination under S. 68D (2) is not of a judicial character (using it in the comprehensive sense,
including ‘quasi-judicial’, which expression has not been approved by high judicial authorities), is
that no objective tests have been laid down in Chapter IV -A with reference to which, the
determination has to be arrived at. The expressions “efficient” , “ adequate” , “ economical” ,
properly coordinated ’ and “public interest’’ are matters of opinion and policy, as S, 68 C itself
indicates, and do not lay down any objective tests. If I am right in that conclusion, there cannot be
any question of evidence 128 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3 forthcoming in proof of
something which is subjective to the authority determining that matter. A very fundamental
consideration in this connection is whether Ss. 68C and 68D contemplate any Us. In other words,
what is the proper scope and ambit of the inquiry envisaged by those sections ? The scheme
prepared and published in accordance with S. 68C by a State Transport Undertaking, is placed before
the pubHc only after the Undertaking has reached the conclusion that it is necessary in the public
interest. A fter the scheme has been prepared and published as aforesaid, the objections to be filed
under S, 68D have reference to the basic question whether or not the scheme as published, was in
pubhc interest. Such objections are open to any person or organization, e.g. an Automobile
Association, and are not limited only to persons who are providing road transport services. In my
opinion, it is a mistake to suppose that the objections contemplated by S, 68D (1), could be on
grounds personal to the objectors who are engaged in the business of providing road transport
services. It is not open to any particular individual carrying on the business of providing road
transport services, to claim that his route should be excluded from the operation of the effective
words of S. 68D (I), namely, “ file objections thereto” , that is, to the scheme published under S. 68 C.
The objections have to be limited to the merits of the scheme as propounded by the State Transport
Undertaking. It will, therefore, be opening the gates too wide to hold that the objections have
reference to particular routes or portions of routes covered by private transport services. The
underlying purpose of inviting objections, is not to invite “ claims” by individual businessmen
engaged in providing road transport services, but to bring out useful information bearing on the
feasibility and soundness of the schcme, as propounded by the Undertaking. Once, the Government
has decided upon a policy of nationaHzation of road transport facilities, the question of safeguarding
the interest of individual businessmen in that line, is no more relevant. W hat is relevant for the
purpose of the inquiry by the Government, on receipt of objections, is whether the published
schcme is in the interest of the public. In my opinion, therefore, it is errgnepiis to suppose that the
object of S, 68D (1) is to afford any rer^iedy ;tb a private individual in his personal intetest.
Particulars of tlie scfetae required to be published under 8. 68 C, are meant for t^e information of
the public, so that persons feeling iht^irested in a public ’s^entute like that, may offer intelligent and
constructive criticism with reference to the merits of the If is equally etroheous to suppose that
SECTION 4 ] ADMINISTRATIVE FUNCTIONS 129 there are two parties, one, represented by the
Undertaking, and the other, represented hy persons who are engaged in the business of providing
road transport services— and that the Government is the third party, which is the arbitrator
between the two contesting parties. That, in my opininion, is not a correct reading of the provisions
of Chapter IV A of the A ct. The whole aim and object of that Chapter is to replace individual
businessmen engaged in that trade, by nationaUsed road transport services which are meant to be
run in the interest of the community as a whole, and thus to serve the best public interest. The
Government is as much interested in the scheme as the Road Transport Undertaking which is a
creature and a limb of the Government, brought into existence with a view to implementing the
policy of the Government to provide nationalised road transport services. That being the whole
scheme of the policy of nationalisation, it is not correct to represent the State Transport Undertaking
as entering into competition with other individual or incorporated bodies whose business it is to
provide the same kind of transport facilities. That is made clear by the provisions of S. 68F, which, as
indicated above, make it obligatory on the Regional Transport Authority to issue permits as applied
for by the State Transport Undertaking. It follows from the foregoing observations that there is no
question of the Government functioning as an adjudicating authority as between the rival claims of
the Undertaking and private persons engaged in the same kind of activity, or that the Secretary to
Goverment in the Department of Road Transport, when he personally heard the objections, was
functioning as a judge.... The scheme as prepared and published, may have proposed, as it did in
instant case, completely to exclude other persons from providing road transport service in the
notified area by the notified routes. But the State Government is not concerned with determining
whether any or some or all of the objectors could be permitted to provide or continue to provide
their own road transport service. The State Government under S. 68D (2) has only to decide whether
or not the proposed scheme should be approved or modified in any way. The decision to be arrived
at by State Government, is confined to the scheme, and is not concerned with rival claims by persons
providing road transport service in the same area or by the same routes.... It has been held and it
may be taken as well settled that when there is a competition between a number of applicants for a
particular route for supplying road transport service, the Regional Transport Authority or any oth§r
Authority deciding between thpse cpriflicting claims, h^§ 130 INDIAN ADMINISTRATIVE LAW
[ CHAPTER 3 to' determine the matter in a quasi-judicial way, because they are determining
questions affecting the rights of individuals. But in the proceeding before the State Government, no
such rival claims have to be decided upon. W hat has to be determined is whether the proposed
scheme will serve public interest. Thus, in proceedings under Chapter IV of the Act,® individual
claims have to be decided upon, whereas under Chapter IV A , it is the collective interest of the
community as a whole, which is the subject-matter of determination by the State Government. In
other words, the proposed scheme is the outcome of the decision by a limb of the State Government
(State Transport Undertaking), which has come to the conclusion that it is in the public interest that
road transport service should be run and operated by the State. The calling of objections by persons
affected by the scheme, is not with a view to deciding between the rival claims of the State
Undertaking and individuals providing road transport services in the area or routes proposed to be
covered. The State Transport Undertaking has not made any claim at this stage. Such a claim arises
after the determination by the State Government imder S. 68D (2). That stage is reached when the
State Transport Undertaking applies for permits under S.68F. Such a claim for a permit, once made
by the Undertaking, is no more a rival claim to be treated along with claims of other individuals
providing such road transport services, but an absolute claim which under that section shall be
granted by the Regional Transport Authority which is authorised even to cancel an existing permit or
modify the terms of an existing permit, or to refuse renewal of permits, with a view to implementing
the approved scheme. In my opinion, therefore, it is not correct to view the proceedings under
Chapter IV A before the State Government as a lis between any rival claims, unlike proceedings
under Chapter IV of the A ct. In view of these considerations, I would hold that there is no lis
between rival claims, no determinate tribunal to determine any lis, and no procedure prescribed in
Chapter IV A approximating or even simulating judicial procedure.... N ote: [The majority in the case
hel^l’that there was a ‘lis’ between the Department, on the one hand ar^^ th^ objectors, on the
other and the Chief Minister was to decide the:jrhatt6r. W ill it not be correct to say that Transport
Department, and the Chifsf Minister being limbs of the Government, the case w^;?: more in the!
nature of the Government 9. Chapter IV deals with the contrpl of motor vehicles by the state
goverjijiXientsV viz., grant of stage carriages permits, etc^ only carry out its duties under R .l (1) by
judging the materials placed before it. It is true that there is no lis in the present case, in the sense
that there are not two contesting parties before the Committee and the matter: rests between the
Committee and the exammee, at the same; time SECTION 4 ] ADMINISTRATIVE FUNCTIONS 139
considering that materials will have to be placed before the Committee to enable it to decide
whether action should be taken under R .l (1), it seems to us only fair that the examinee against
whom the Committee is proceeding should also be heard. The effect of the decision of the
Committee may in an extreme case blast the career of a young student for life and in any case will
put a serious stigma on the examinee concerned which may damage him in later life. The nature of
misconduct which the Committee has to find under R. 1 (1) in some cases is of a serious nature, for
example, impersonation, commission of fraud, and perjury; and the Committee's decision in matters
of such seriousness may even lead in some cases to the prosecution of the examinee in courts.
Considering therefore the serious effects following the decision of the Committee and the serious
nature of the misconduct which may be found in some cases under R .l (1), it seems to us that the
Committee must be held to act judicially in circumstances as those. Though therefore there is
notHng express one way or the other in the A ct or the Regulations casting a duty on the Committee
to act judicially, the manner of the disposal, based as it must be on materials placed before it, and
the serious effects of the decision of the Committee on the examinee concerned, must lead to the
conclusion that a duty is cast on the Committee to act judicially in this matter particularly as it has to
decide objectively certain facts which may seriously affect the rights and careers of examinees,
before it can take any action in the exercise of its power under R .l (1). W e are therefore of opinion
that the Committee when it exercises its powers under R .l (1) is acting quasi-judicially and the
principles of natural justice which require that the other party, (namely, the examinee in this case)
must be heatd, will apply to the proceedings before the Committee.. ; It is urged on behalf of the
appellant that there are a large number of cases which come up before the Committee under R. 1
(1), and if the Committee is held to act judicially as a quasi-judicial tribunal in the matter it will find it
impossible to carry on its task. This in our opinion is no criterion for deciding whether a duty is cast
to act judicially in view of all the circumstances of the case. There is no doubt in our mind that
considering the totality of circumstances the Committee has to act judicially when taking action
under R. 1 (1). As to the manner in which it should give an opportunity to the examinee concerned
to be heard, that is a matter which can be 14. Dipa Pal University o f Calcutta, A.T R. 1952 Cal. 594;
B .C . Das Qupta V . Bijoyranjan Rakshit, A.I.R. 1953 Cal. 212. 140 INDIAN ADMINISTRATIVE LAW
[ CHAPTER 3 provided by Regulations or Bye-laws if necessary. As was pointed out in Local
Government Board v. Arlidge, 1915 A .C . 120 all that is required is that the other party should have
an opportunity of adequately presenting his case. But what the procedure should be in detail will
depend on the nature of the tribunaL There is no doubt that many of the powers of the Committee
under Chapter V I are of administrative nature; but where quasi-judicial duties are entrusted to an
administrative body like this it becomes a quasijudicial body for performing these duties and it can
prescribe its own procedure so long as the principles of natural justice are followed and adequate
opportunity of presenting his case is given to the examinee.... SECTION 4 J ADMINISTRATIVE
FUNCTIONS 141 RADESHYAM v. STATE OF MADHYA PRADESH A. I. R. 1959 S. C. 107. [Two factions
existed in the Municipal Committee of Dhamtari which made charges against each other. Finally, the
State Government, under section 53A of the C.P. and Berar Municipalities A ct, 1922 notified that
the Municipal Committee was incompetent to do its work and, therefore, appointed an Executive
Secretary for a period of eighteen months to perform the various duties to the exclusion of the
committee, President, V icePresident, or Secretary. The case was brought to the Supreme Court by
special leave to appeal. The main contention of the appellants (the President and the Committee)
was that the notification was ultra vires the State Government as it was made in breach of the rules
of natural justice in so far as no opportunity was given to the appellants to defend, themselves.
Sections 53 A and 57 of the A ct ran as follows :— “53 A (1) If a committee is not com petent to
perform the duties imposed on it or undertaken by it fet; Or under this A ct or any other enactment
for the time beinig in force and the State Government considers that a getieiral improvement m thp
administration of the*‘municipality is likely to be secured by the appointment of a servant of the
Government as the execijtive officer o f the committee, the State Government may, by an §tating
the reasons therefor published in jthe Gazette, appoint -suc.h servant as the executive officer of the
committee for such -period not exceeding eighteen months as may be specified in such o rd er/’ - “
57 (1) If a committee is not competent to perform, or persistently makes default in the performance
of the duties imposed on it or undertaken by it under this A ct or any other enactment for the time
being in force, or exceeds or abuses its powers to a grave extent, the State Government may, by an
order stating the reasons therefor published in the Official Gazettej dissolve such committee and
may order a fresh election to take place. “ (5) No order under sub-s. (1)... shall be passed until
reasonable opportunity has been given to the committee to furnish an explanation.” According to S.
57 (5), no order under S. 57 (1) could be passed until reasonable opportunity had been given to the
committee to furnish an explanation.] S. R. Das, C. J. It is pointed out that in case of incompetency,
action can be taken either under S. 53-A or S. 57 but in case of abuse of power action can be taken
only under S. 57. Reference is then made to the grounds enumerated in the notification itself and it
is argued that except perhaps grounds a, b, c, and g which may be indicative of incompetency, the
other grounds, which are, by far, greater in number, obviously constitute abuse of powers and from
this circumstance the conclusion is sought to be drawn that in substance and in reality the impugned
notification must have been made under S. 57 and'that being so the notification cannot be sustained
because of t^e non-compliance with the provisions of sub-sec. (5) of S. 57 which expressly lay down
that no order under sub-sec. (1) or (2) shall be passed until reasonable opportunity has been given to
the committee to furnish an explanation. I am not persuaded to uphold this argument. ...The effect
of an order made under S. 57 is, therefore, extremely drastic and puts an end to the very existence
of the committee itself and, in view of the grave nature of the consequence that will ensue, the
legislature presumably thought that some protection should be given to the committee before such
a drastic action was taken and accordingly it provided, by sub-sec. (5) of that section, that no order
should be passed until reasonable opportunity had been given to the committee to furni$b an
explanatiori—a provision which clearly 142 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3 indicates
that action under S.,57 can only be taken after hearing and considering all the explanations
furnished by or on behalf of the committee. The legislature did not think fit to provide a similar
safeguard in S, 53-A presumably because the order under the last mentioned section was of a
temporary duration, was not very drastic and did not threaten the very existence of the
committee,... W hat, then, is the position here? Certain charges had been made in writing against
the Committee and its president which were forwarded to the president with a request to submit
explanations in detail. The President, acting in his official capacity, gave detailed explanations in
writing and sent the same officially from the office of the municipal committee to the Additional
Deputy Collector who was deputed by the Collector to hold the enquiry. The Additional Deputy
Collector held the enquiry during which the president appeared in person on several days and came
to certain findings and presumably made his report which in due course must have reached the
State Government. The State Government apparently accepted such of those findings as have been
set out in the notification itself. Even according to learned counsel for the appellants some of those
findings amount only to incompetency and the rest, he contends, amount to abuse of power....
Taking the position to be as contended by learned counsel for the appellants the position was that,
as a result of the enquiry, the State Government found two things against the appellant committee,
namely (i) that it was guilty of incompetency and (ii) that it was also guilty of certain abuses.of
power. I have already stated that the State Government was not obliged to take any action at all
either under S. 53-A or under S. 57. If the State Government considered that it was necessary to
i:ake action, it was entirely for the State Government to consider whether it would take action for
incompetency or for abuse of power.... . ..,lL]earned counsel for the appellants contends that where
a statute requires a decision to be arrived at purely from the point o£ view of policy or expediency
the authority is under no duty to act judicially. H e urges that where, on the other hand, the order
has to be passed on evidence either under an express provision of the statute or by impHcation and
determination of particular facts on which its jurisdiction to exercise its power depends or if there is
a proposal and an opposition the authority is under a duty to act judicially.... He concedes that the
ultimate order under that section (S. 53-A) is purely discngtipnary,; that k tp^^ay/the ^ j
ADMINISTRATIVE FUNCTIONS 143 obliged to take any action under the section. It may make an
order under the section or it may not according as it thinks fit. But in case the State Government
chooses to act under the section, it can only do so if the conditions therein laid down are fulfilled....
[T]here are two prerequisites to be satisfied before the State Government can take action under S.
53-A, namely, (1) that the municipal committee is not competent to perform the duties imposed on
it and (2) that the State Government considers that a general improvement in the administration of
the municipality is likely to be secured by the appointment of a servant of the Government as the
Executive Officer of the Committee.... O f the two conditions the second one, by the very language in
which it is expressed, is left entirely a matter for the State Government to consider, for it depends
entirely on the view of its own duty and responsibility that the State Government may take on a
consideration of the situation arising before it. In other words, the statute has left that matter to the
subjective determination of the State Government. The first requisite, however, is an objective fact,
namely, whether the committee is or is not competent to perform the duties imposed on it. The
determination of that fact, it is pointed out, has not been left to the subjective determination by the
State Government. Learned counsel for the appellants urges that if it were intended to leave the
determination of this fact of incompetency also to the subjective opinion of the State Government,
the section would have been framed otherwise. It would have said something like this: ‘If the State
Government consider that a committee is not competent to perform the duties... and that the
general improvement in the administration of the municipalities is likely to be secured by,...’ This the
Legislature has not done and has, thus, clearly evinced an intention not to leave it to the ipse dixit of
State Government. Section 53-A, it is pointed out, differs materially in this respect from S-3 of the
Bombay Land Requisition Ordinance (V of 1947) which was considered by this Court in Khushaldas
AdvanVs case. (A . I. R. 1950 S. C. 222). That section of the Bombay Ordinance opened with the
words: ‘If in the opinion of the Provincial Government....’ which were taken as indicative of the
Legislature’s intention to leave the determination of the existence of all the conditions precedent
entirely to the subjective opinion of the Provincial Government so as to make the action a purely
administrative one. The argument is that the first requirement is the finding of a fact which may be
called a jurisdictipnal fact, so that the power under S, 53-A can only be 144 INDIAN ADMINISTRATIVE
LAW [ C l exercised when that jurisdictional fact is established to exist. The determination of the
existence of that jurisdictional fact, it is contended, is not left to the subjective opinion of the State
Government and that although the ultimate act is an administrative one the State Government must
at thepreliminary stage of determining the jurisdictional fact act judicially and determine it
objectively, that is to say, in a quasi-judicial way. It is assumed that whenever there has to be a
determination of a fact which affects the rights of the parties, the decision must be a quasi-judicial
decision.... The simple fact that the incompetency of the cominittee goes to the root of the
jurisdiction of the State Government to exercise its power under S.53-A does not require that that
fact must be determined judicially. The sole question is, does the statute require the State
Government to act judicially. There need not be any express provision that the State Government
must act judicially. It will be sufficient if this duty may be imphed from the provisions of the statute.
The mere fact that a question of fact has to be determined as a preliminary condition before action
can be taken under the statute by itself does not carry that implication. There must: be some
indication in the statute as to the manner or mode in which the preliminary fact is to be determined.
I find nothing in S. 53-A which in terms imposes any duty on the State Government to act judicially.
No form of procedure is laid down or even referred to from which such a duty could be inferred. On
the contrary one finds a significant omission of any provision like that embodied in sub-sec. (5) of S.
57 which requires that no order under that section shall be passed until reasonable opportunity has
been given to the committee to furnish an explanation.... Further, S. 53-A contemplates swift action
and a judicial hearing may easily frustrate the very purpose contemplated by S. 53-A, for a judicial
act will be subject to the powers of superintendence of the superior Courts and the operation of the
order under S. 53-A may be postponed.... The requirement that the State Government must give
reasons for the order it makes, does not necessarily require it to record a judgment judicially arrived
at.... To say that action to be taken under S. 53-A is an administrative action is not to say that the
State Government has not to observe the ordinary rules of fair play.... But that is quite different from
the well ordered procedure involving notice and opportunity of hearing, necessary to be followed
before a quasi-judicial action, opeii to correction by a superior court by means of a writ of certiorari,
can be taken. The difference lies in the manner mode of the two SECTION 4 ] ADMINISTRATIVE
FUNCTIONS 145 procedures. For the breach of the rules of fair play in taking administrative action a
writ of certiorari will not lie. S. K. Das, J. To get to the bottom of the distinction, we must go a little
deeper into the content of the expression ‘duty to act judicially . As has been repeated so often, the
question may arise in widely differing circumstances and a precise, clear-cut or exhaustive definition
of the expression is not possible. But in decisions dealing with the question several tests have been
laid down for example (i) W hecher there is a lis inter parties; (ii) W hether there is a claim (or
proposition) and an opposition; (iii) W hether the decision to be founded on the taking of evidence
or on affidavits; (iv) W hether the decision is actuated in whole or in part by questions of poHcy or
expediency, and if so, whether in arriving at the decision, the statutory body has to consider
proposals and objections and evidence; and (v ) W hether in arriving at its decision, the statutory
body has only to consider policy and expediency and at no stage has before it any form of h's. The
last two tests were discussed and considered in (1952)2 Q.B. 413^’’. It is fairly clear to me that tests
(i) to (iv) are inappropriate in the present case by reason of the provisions in S. 53-A as contrasted
with S. 57 and other sections of the Act. The test which is fulfilled in the present case is test (v) and
that makes the function under S. 53-A a purely administrative function in spite of the requirement of
an initial determination of a jurisdictional fact and the recording of reasons for the decision, I am
content to rest my decision on the aforesaid ground, as I am not satisfied that the enquiry held by
the Deputy Collector was a proper enquiry if it be held that S53-A entrusts a quasi-judicial function
to the State Government and therefore requires compliance with the principles of natural justice.
That enquiry was for a different purpose altogether, the charges were not the same, and in my view
the Municipal Committee had no real opportunity of meeting the charges on which the State
Government ultimately took action. I prefer, therefore, to base my decision on the third question on
the 1 5 . i?. V . Munchester Legal Aid Committee^ (Ed.). 146 INDIAN ADMINISTRATIVE LAW
[ CHAPTER 3 short ground that the function which the State Government exercised under S. 53-A
was administrative in nature.... Siibba Rao, J'. Before considering the vaUdity of the arguments based
upon the provisions of tiie section, it would be cciivenient at this stage to notice briefly the
distinction between a judicial and an administrative act and the criteria laid down by decisions for
ascertaining whether a particular act is a judicial act or an administrative one. The said criteria have
been laid down with clarity by Lord Justice Atkin in (1924) 1 K.B, 171,^° elaborated by Lord Justice
Scrutton in (1931) 2 K.B. 215^’ and authoritatively restated in 1950 S. C. R. 621 (A . L R. 1950 S.C.
222).^^ The aforesaid decisions lay down the following conditions to be complied with: (1) the body
of persons must have, legal authority; (2) the authority should be given to determine Questions
affecting the rights of subjects; and (3) they should have a duty to act judicially. So far there is no
dispute. The question raised in this case is what do the words “ a duty to act judicially" mean. If the
statute in express terms says that the decision should be arrived at judicially, then it is an obvious
case. If it does not expressly say so, can the intention of the Legislature be gathered or imphed from
the terms of the statute? If it can be so gathered, what are the guiding factors for implying such a
duty on the part of a tribunal or authority?... In the present case, S. 53-A of the A ct itself provides
the necessary criteria to answer the question. Before the Government can take action under the
section, three preliminary conditions for the exercise of the power are laid down: (1) the Committee
is not com petent to perform the duties imposed on it; (2) the State Government considers that a
general improvement in the administration of the municipality is likely to be secured by the
appointment of a servant of the Government; (3) an order stating the reasons therefor. The first
condition depends upon the determination of an objective fact, namely, whether the committee is
competent to perform the duties imposed upon it. It is a jurisdictional fact, that confers jurisdiction
on the Government to take further action. The determination o f this fact is not left to the subjective
satisfaction of the Government. Indeed, the different phraseology used in regard to 16. R. V,
Electricity Commissioners. (Ed.). 17. R. V . The London Council ex parte The Entertainment Protection
As.sociation Ltd., (Ed.). 18. Province of Borribayv. Khnshaldas h SECTION 4 ] ADMINISTRATIVE
FUNCTIONS 147 the second condition, namely, “ the State Government considers”, brings out in
bold relief the distinction between the two; while in the former an objective fact has to be
determined, in the latter the fact is left to the subjective satisfaction of the Government,... The
Government has to arrive at the finding of their incompetency on the basis of objective facts to be
ascertained and to give reasons for its finding. It is against all cannons of natural justice that a
tribunal should arrive at a finding of far-reaching consequence without giving an opportunity to
explain to the persons who would be affected by such a finding. For the aforesaid reasons, I have no
doubt that the section imposes a duty on the Government to act judicially in ascertaining the
objective and jurisdictional fact, namely, whether the committee is incompetent. It is a necessary
condition of such a duty to give an opportunity to the committee to explain the grave charges
levelled against it. Admittedly, no such opportunity was given to the committee and I cannot agree
with the learned Advocate-General that the inquiry by the Deputy Collector at an earlier stage for a
different purpose had in effect given an opportunity to the committee. It is not known what were
the charges for which that inquiry was held. The record discloses that the inquiry v/as held by a
subordinate officer—there is nothing on record to show that the Government authorised either the
Collector or the Deputy Collector to make the inquiry.... In my view, the inquiry cannot presumably
take the place of reasonable opportunity to be given by the Government for the proposed action
under S. 53-A of the A ct.... 148 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3 BHARAT BANK v.
EMPLOYEES OF BHARAT BANK A. I. R. 1950 S. C, 188 [One of the questions that was considered in
the case was whether the industrial tribunal was quasi-judicial or administrative in nature.] Fazl AH, J
.: [TJhere can be no doubt that the industrial tribunal has to use a well-known expression, “ all the
trappings of a court” and performs functions which cannot but be regarded as judicial. This is
evident from the rules by which the proceedings before the tribunal are regulated. It appears that
the proceedmg before it commences on an application which in many respects is in the nature of a
plaint. It has the same powers as are vested in a civil court under the Code of Civil Procedure when
trying a suit, in respect of discovery, inspection, granting adjournment, reception of evidence taken
on ajffidavit, enforcing the attendance of witnesses; compelHng the production of documents,
issuing commissions, etc. It is to be deemed to he a civil court within the meaning of Ss. 480 and 412,
Criminal P. C., 1898. It may admit and call for evidence at any stage of the proceeding and has the
power to administer oathsi' The parties appearing before it have the right of examination, cross-
examination and re-examination and of addressing it after all evidence has been called. A party may
also be represented, by a legal practitioner with its permission. The matter does not rest there. The
main function of this tribunal is to adjudicate on industrial disputes which implies that there must be
two or more parties before it with conflicting cases, and that it has also to arrive at a conclusion as to
how the dispute is to be ended. Prima facie, therefore, a tribunal like this cannot be excluded from
the scope of Art. 136, but before any final conclusion can be expressed on the subject certain
contentions which have been put forward on behalf of the respondents have to be disposed of. The
first contention is that the industrial tribunal cannot be said to perform a judicial or quasi-judicial
function, since it is not required to be guided by any recognized substantive law in deciding disputes
which come before it. On the other hand, in deciding industrial disputes, it has to override contracts
and create rights which are opposed to contractual rights.... ....The tribunal has to adjudicate in
accordance with the provisions of the Industrial Disputes A ct. It may sometimes override contracts,
but so can a court which has to administer law according to the Bengal or Bihar Money lenders Act,
Encumbered Estates A ct and other similar Acts. The tribunal has to observe the provisions of the
special law which it has to administer though that law may be different from the law which an
ordinary Court of Justice administers. The appellate Court, therefore, can at least see that the rules
according to which it has to act and the provisions which are binding upon it are observed, and its
powers are not exercised in an arbitrary or capricious manner, SECTION 4 J a d m in is t r a t iv e
FUNCTIONS 149 The second contention which is a more serious one, is that the adiudication of the
tribunal has not all the attributes of a judicial decision, because the adjudication cannot bind the
parties until it is declared to be binding by the Government under S. 15, Industrial Disputes Act. It is
said that the adjudication is really in the nature of an advice or report which is not effective until
made so by the Government.... It is to be noted that under S. 15, Industrial Disputes A ct, 1947, in
cases where the appropriate Government is not a party to the dispute all that the Government has
to do on receiving the award of the tribunal is to declare it to be binding and to state from what date
and for what period it will be binding.... ..,[T]he Government cannot alter, or cancel, or add to the
award, but the award must be declared to be binding as it is. In substance, therefore, the
adjudication of the tribunal amounts to a final determination of the dispute which binds the parties
as well as the Government. Mahajan^ /. : It is now convenient to consider whether a tribunal
constituted under the Industrial Disputes A ct, 1947, exercises all or any of the functions of a Court
of Justice and whether it discharges them according to law or whether it can act as it likes in its
deliberations and is guided by its own notions of right and wrong. The phrase “industrial dispute”
has been defined in S. 2. cl. (k) of the A ct as follows : “ any dispute or difference between employers
and employees, or between employers and workmen, or between workmen and workmen, which is
connected with the employment or nonemployment on the terms of employment or with the
condition of labour, of any person.” Such a dispute concerns the rights of employers and employees.
Its decision affects the terms of contract of service or the conditions of employment. Not only may
the pecuniary Hability of an employer be considerably affected by the adjudication of such dispute
but it may even result in the imposition of punishments on him. It may adversely affect the
employees as well. Adjudication of such a dispute affects valuable rights. The dispute and its result
can always be translated in terms of money. The point for decision in. the dispute usually is how
much money has to pass out of the pocket of 150 INDIAN ADMINISTRATIVE LA W [ CHAPTER 3 the
employer to the pocket of the employee in one form or another and as to what extent the right of
freedom of contract stands modified to bring about industrial peace. Power to adjudicate on such a
dispute is given by S. 7 of the statute to an Industrial Tribunal and a duty is cast on it to adjudicate it
in accordance with the provisions o f the Act, The words underlined (italicised) clearly imply that the
dispute has to be adjudicated according to law and not in any other manner. W hen the dispute has
to be adjudicated in accordance with the provisions of the A ct, it follows that the tribunal has to
adhere to law, though that law may be different from the law that an ordinary Court of justice
administers. It is noteworthy that the tribunal is to consist of experienced judicial ofikers and its
award is defined as a determination of the dispute. The expression “adjudication” implies that the
tribunal is to act as a Judge of the dispute; in other words, it sits as a Court of justice and does not
occupy the chair of an administrator. It is pertinent to point out that the tribunal is not given any
executive or administrative powers In S. 38 of the A ct power is given to make rules for the purpose
of giving effect to the provisions of the A ct. Such rules can provide in respect of matters which
concern the powers and procedure of tribunals including rules as to the summoning of witnesses,
the production of documents relevant to the subject-matter and as to appearance of legal
practitioners in proceedings under this Act. Rule 3 of these rules provides that any application for
the reference of an industrial dispute to a tribunal shall be made in Form (A ) and shall be
accompanied by a statement setting forth, iriter alia, the names of the parties to, the dispute and
the specific matters of dispute. It is in a sense in the nature of a plaint in a suit. In Rule 13 power is
given to administer oaths. Rule 14 provides as follows “ A tribunal may accept, admit or call for
evidence at any stage of the proceeding before it and in such manner as it may think fit.” Rule 17
provides that at its first sitting the tribunal is to call upon the parties to state their case. In Rule 19
provision has been made for proceeding ex parte. Rule 21 provides that in addition to the powers
conferred by Sub-s. 3 of S. 11 of the A ct, a tribunal shall have the same powers as are vested in a
civil court under the Code of Civil Procedure when trying a suit, in respect of the following matters,
namely, (a) discovery and inspection: (b) granting of adjo urnmenf, (c) reception of evidence taken
on affidavit; and that the tribunal may summon and examine siio niotu ariy person whose SECTION 4
] ADMINISTRATIVE FUNCTIONS 151 evidence appears to it to be material. It further says that the
tribunal shall be deemed to be a civil court within the meaning of Ss, 480 and 482, Criminal
Procedure Code, 1898. Rule 21 says that the representatives of the parties, appearing before a
tribunal, shall havethe right of examination, cross-examination and re-examination and of
addressing the court or tribunal when all evidence has been called. In Rule 30 it is provided that a
party to a reference may be represented by a legal practitioner with the permission of the tribunal
and subject to such conditions as the tribunal may impose. In S. 11 (3) it is laid down that a tribunal
shall have the same powers as are vested in a civil Court under the Code of Civil Procedure when
trying a suit, in respect of the following matters, namely, (a) enforcing the attendance of any person
and examining him on oath; (b ) compelling the production of documents and material objects; (c)
issuing commissions for the examination of witnesses; (d) in respect of such other matters as may be
prescribed, and every inquiry or investigation by a tribunal shall be deemed to be a judicial
proceeding within the meaning of Ss. 193 and 228, Penal Code. It was---strenuously urged that the
award of the tribunal had no binding force by itself and unless the appropriate Government made a
declaration in writing under cl. (2) of S. 15 this award was a jifeless document and had no sanction
behind it and therefore it could not have been contemplated that it would be appealable even by
special leave. In my opinion, this contention is unsound. The provisions of : Cl. (2) of S. 15 leave no
discretion in the Government either to affirm, modify or reject the award. It is bound to declare it
binding. It has no option in the matter. In such a situation it is the determination by the tribunal that
matters, without that determination Government cannot function. It does not possess the power
either to adjudicate the dispute or alter it in any manner whatsoever. That power vests in tribunal
alone... 152 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3 RIDGE V. BALDWIN (1963)2 W.L.R. 935
[Under Section 191 (4) of the Municipal Corporation A ct, 1882, a watch committee has power to
dismisss any constable whom it thinks negligent in the discharge of his duty, or otherwise unfit for
the same.” The respondent watch committee, the police autiiority of the county borough of Brighton
summarily dismissed the appellant, who was Chief Constable, in cons^equence of the evidence given
during a trial at which he had been acquitted and of observations made by the trial judge on
appellant’s fitness for his duties, The appellant was given no notice of the charges against him nor
any opportunities to be heard before the Committee. His appeal to the Home Secretary also failed in
that the Home Secretary decided not to set aside the watch committee s decision. Therefore, the
appellant instituted proceedings against the m.embers of the Committee, claiming a declaration that
its decision was void. The Court o f Appeal, in refusing to set aside the Committee’s decision held,
alia that the watch committee, exercising their power under Section 191 (4) of the A ct of 1882 were
acting in an administrative or executive capacity, notin a judicial or quasi-judicial nature with the
result that the rules of natural justice did not apply to their proceedings for dismissal. The case came
in appeal before the House of Lords which allowed the appeal by a majority of four to one (Lords
Reid; Morris of Borth-y-Gest, Hodson and Devlin : Lord Evershed dissenting.)] Lord Reid The power of
dismissal is contained in section 191 (4) of the Municipal Corporations A ct, 1882. So far as I am
aware, that subsection is the only statutory provision regarding dismissal, and the respondents
purported to act under it. It is in these terms: "The "w atch committee, or any two justices having
jurisdiction in the "borough, may at any time suspend, and the watch committee may "at any time
dismiss, any borough constable whom they think negligent "in the discharge of his duty, or
otherwise unfit for the same” ... The appellant’s case is that in proceeding under the A ct of 1882 the
watch committee were bound to observe what are commonly called the principles of natural justice.
Before attempting to reach any decision they were bound to inform him of the grounds on which
they proposed to act and give him a fair opportunity of being heard in his own defence___It appears
to me that one reason why the authorities on natural justice have been found difficult to reconcile is
that insufficient attention has been paid 'to the great difference between various kinds of cases in
which it has been sought to apply the principle. W hat a minister ought to do in considering
objectioCis' to a scheme may be very different from what,, a, watch committee SECTION 4 ]
ADMINISTRATIVE FUNCTIONS 153 ought to do in considering whether to dismiss a chief constable.
So I shall deal first with cases of dismissal. These appear to fall into three clauses: dismissal of a
servant by his master, dismissal from an office held during pleasure, and dismissal from an office
where there must be something against a man to warrant his dismissal. [After holding that in the
first two classes the principle of natural justice is not applicable, His Lordship continued.] So I come
to the third class which includes the present case. There I find an unbroken line of authority to the
effect that an officer cannot lawfully be dismissed without first telling him what is alleged against
him and hearing his defence or explanation ... [Then follows a discussion of the case-law] Stopping
there, I would think that authority was wholly in favour of the appellant but the respondent’s
argument was mainly based on what has been said in a number of fairly recent cases dealing with
different subject-matter. Those cases deal with decisions by ministers, officials and bodies of various
kinds Vv4iich adversely affected property or no proper opportunity of presenting their cases before
the decisions were given. And it is necessary to examine those cases for another reason. The
question which was or ought to have been considered by the watch committee on March 7, 1958,
was not a simple question whether or not the appellant should be dismissed. There were three
possible courses open to watch committee—-reinstating the appellant as chief constable, dismissing
him, or requiring him to resign. The difference between the latter two is that dismissal involved
forfeiture of pension rights whereas requiring him to resign did not .. I would start an examination of
the authorities dealing with property rights and privileges with Copper v- Wandsworth Board of W
orksP W here an owner had failed to give proper notice to the Board they had under an A ct of 1855
authority to demolish any building he had erected and recover the cost from him. This action was
brought against the board because they had used that power without giving the owner an
opportunity of being heard. The board maintained that their discretion to order demolition was not
a judicial discretion and that any appeal should have been to the Metropolitan Board of works. But
the court dccided unanimously in favour of the owner. Erie C. J. held that the power was subject to a
qualification repeatedly recognised that no man is to be deprived of his property without his having
an opportunity of being heard and 19. (1863) 14 C.B.N.S. 180. ” 154 INDIAN ADMINISTRATIVE LAW
[CHAPTERS that this had been applied to “many exercises of power which in “ common
understanding would not be at all a more judicial proceeding "than would be the act of the district
board in ordering a house “ to be pulled down. W illcs J. said that the rule was of universal “
application, and founded upon the plainest principles of justice, “ and Byles J. said that although
there are no positive words in a “ statute requiring that the party shall be heard, yet the justice of “
the common law will supply the omission of the legislature," This was followed mBopkins v.
Smethwic Local Board o f Health}'^ Wills J. said: “ In condemning a man to have his house pulled
down, “ a judicial act is as much implied as in fining him £5; and as the local “board is the only
tribunal that can make such an order its act must “ be a judicial act, and the party to be affected
should have a notice “ given him;,., the iudgement of W illes }. [in Cooper's case] does for “more
upon the nature of the thing done by the board than on the “ phraseology of the A ct itself. It deals
with the case on principles: “from the nature of the thing done it must be a judicial act, and “ justice
requires that the man should be heard.” In the Court of Appeal, Lord Esher M.R., in dismissing an
appeal expressly approved the principles laid down in Cooper’s co.se. The principle was applied in
different circumstances in Smithy, The Queen!"^^ That was an action of ejectment on the alleged
forfeiture of a Crown lease in Queensland. The Governor was entitled to forfeit the lease if it has
been proved to the satisfaction of a commissioner that the lessee had abandoned or ceased to
reside on the land. The commissioner did not disclose to the lessee the case against him so that he
had no opportunity to meet it, and therefore his decision could not stand, The Commissioner was
not bound by any rules as to procedure or evidence but he had to conduct his inquiry, “ according to
the requirements of substantial justice.” In De Verteuil v. Knaggs^-^ the Governor of Trinidad was
entitled to remove immigrants from an estate “ on sufficient ground shown to his satisfaction.” Lord
Parmoor said that; “ The acting Governor was “ not called upon to give a decision on an appeal
between parties, “and it is not suggested that he holds the position of a judge or that “the appellant
is entitled to insist on the forms used in ordinaty “judicial procedure, but he had a duty ©f giving to
any persoin “ against whom the complaint is made a fair opportunity to rQafee any “ relevant
statement which he may desire to bring forward and a fair 20. (1890) 24’ q .B.D, 712, 714-15. ~ ~ 21.
(1878) L.R. 3 App. Cas. 614, P.C. 22. (1918) A.C. 557, 34 T.L.R. 323, P.C SECTION 4 ] ADMINISTRATIVE
FUNCTIONS 155 “ opportunity to correct or controvert any relevant statement brought “forward to
“his prejudice.” The duty of an official architect in fixing a building line was stated in somewhat
similar terms in Spackman v. Plumstead District Board o f WorksP I "shall now turn to a different
class of case— deprivation of a professional or social body. In Wood v. Wood-^ the committee
purported to expel a member of a mutual insurance society without hearing him, and it was held
that their action was void, and so he was still a member. Kellay C.B. said of audi alteram partem: “
This rule “ is not confined to the conduct of strictly legal tribunals, but is “ applicable to every
tribunal or body of persons invested with “ authority to adjudicate upon matters involving civil
consequences "to individuals ” This was expressly approved by Lord Macnaghten giving the
judgment of the Board in Lapointe v V Association de Bienfalsance et de Retrate de la Police de
Montrealr' In that case the board of directors of the association had to decide whether to give a
pension to a dismissed constable—the very point the watch committee had to decide in this case—
and it was held that they had to observe “ the elementary principles of justice.” Then there are the
club cases Fisher v. Keane^^ and Dawktns v, Antrohus.^’^ In the former, Jessel M. R, said of the
committee, “ They “ought not, as I understand it, according to the ordinary rules by “ which justice
should be administered by committees of clubs or by “ any other body of persons who decide upon
the conduct of others, to “ blast a man’s reputation for ever— perhaps to ruin his prospects for “life,
without giving him an opportunity of either defending or “ palliating his conduct.*' In the latter case
it was held that nothing had been done contrary to natural justice. In Weinberger v. Inglis^^ a
member of enemy birth was excluded from the Stock Exchange and it was held that the committee
had heard him before acting, Lord Birkenhead L.C. said: “ ...if I took the view that the appellant was “
condemned upon grounds never brought to his notice, I should not “ assent to the legality of that
course, unless compelled by authority.’' He said this although the rule under which the committee
acted was in the widest possible terms—that the committee should each year 23. (1885) 10 A.C.
229; I.T.L.R. 313. H.L. 24. (1874) L.R. 9 Ex. 190. 25. (1906) A.C. 535; 22 T.L.R. 768, P.C. 26. (1878) 11
Ch.D. 353. 27. (1879) 17 Ch.D. 615, CA. 28. (1919) A.C. 606; 35 T.L.R. 399, H.L. 156 iNDtAH a d m in is
t r a t iv e LAW [CHAPTERS re-elect such members as they should deem eligible as members of the
Stock Exchange. I shall not at present advert to the various trade union cases because I am
deliberately considering the state o£ the law before difficulties "were introduced by statements in
various fairly recent cases. It appears to me that if the present case had arisen thirty or forty years
ago the courts would have had no difficulty in deciding this issue in favour of the appellant on the
authorities which I have cited. So far as I am aware none of these authorities has ever been
disapproved or even doubted. Yet the Court of Appeal has decided this issue against the appellant
on more recent authorities which apparently justify that result. How has this come about ? A t least
three things appear to me to have contributed. In the first place, there have been many cases where
it has been sought to apply the principles of natural justice to the wider duties imposed on ministers'
and other organs of government by modern legislation. For reasons which I shall attempt to state in
a moment, it has been held that those principles have a limited application in such cases and those
limitations have tended to be reflected in other decisions on matters to which in principle they do
not appear to me to apply. Secondly, again for reasons which I shall attempt to state, those
principles have been held to have a limited application in cases arising out of wartime legislation;
and agains such limitations have tended to be reflected in other cases. And, thirdly, there has, I
think, been a misunderstanding of the judgement of Atkin L. J. in Rex v. EiectricUy Commissioners, Ex
parte London Electricity Joint Committee Co}^ In cases of the kind I have been dealing with, the
Board of W orks or the Governor or the club committee was dealing with a single isolated case. It w-
as not deciding, like a judge in a law-suit, what were the rights of the person before it. But it was
deciding how he should be treated— something analogous to a judge’s duty in imposing a penalty. N
o doubt policy would play some part in the decision— but so it might when a judge is imposing a
sentence. So it was easy to say that such a body is performing a qua si-judicial task in considering
and deciding such a matter, and to require it to observe the essentials of all proceedings of a judicial
character—the principles of natural justice. ' Sometimes the functions of a minister or department
may also be of that character and then the rules of natural justice can apply 29. (1924) K.B. 171. This
case has also been use4 in fodia as a starting-point of the discnssion on quasi-judicial SECTION 4 J
ADMINISTRATIVE FUNCTIONS 157 in much the same way. But more often their functions are of a
very different character. If a minister is considering whether to make a scheme for, say, an important
new road, bis primary concern will not be with the damage which its construction will do to the
rights of individual owners of land. He will have to consider all manner of questions of public interest
and, it may be, a number of alternative schemes. He cannot be prevented from attaching more
importance to the fulfilment of his policy than to the fate of individual objectors and it would be
quite wrong for the courts to say that the minister should or could act in the same kind of way as a
board of works deciding whether a house should be pulled down. And there is another important
difference. As explained in' Local Government Board v. Arlidge^^ a minister cannot do everything
himself. His officers will have to gather and sift all the facts including objections by individuals and no
individual can complain if the ordinary accepted methods of carrying on public business do not give
him as good protection as would be given by the principles of natural justice in a different kind of
case. And now I must say something regarding war-time legislation. The older authorities clearly
show how the courts engrafted the principles of natural’justice on to a host of provisions authorising
administrative interference with private rights. Parliament knew quite well that the courts had an
inveterate habit of doing that and must therefore be held to have authorised them to do it unless a
particular A ct showed a contrary intention. And such an intention could appear as a reasonable
inference as well as from express words. It seems to me to be a reasonable and almost an inevitable
inference from the circumtances in which Defence Regulations were made and from their subject-
matter that, at least in many cases, the intention must have been to exclude the principles of natural
justice. W ar-tim e secrecy alone would often require that, and the need for speed and general
pressure of work were other factors. But it was not to be expected that anyone would state in so
many words that a temporary abandonment of the rules of natural justice was one of the sacrifices
which war conditions required—that would have been almost calculated to create the alarm and
despondency against which one of the regulations was specifically directed. And I would draw the
same conclusion from another fact. In many regulations there was set out an alternative safeguard
more practicable in war time— the objective test that the officer must have reasonable cause to
believe 30. (1915) A,C. 120; 30 T.L.R. 672. H.L. 158 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3
whatever was the crucial matter. (I leave out of account the very pecahar decision of this House in
Liversicige v. Anderson}'^) So I would not think that any decision that the rules of natural justice
were excluded from war-time legislation should be regarded as of any great weight in dealing wnth a
case such as this case, which is of the older type and which involves the interpretation of an A ct
passed long before modern modification of the principles of natural justice became necessary, and
at a time when, as Parliament was well aware, the courts habitually applied the principles of natural
justice to provisions like section 191 (4) of the A ct of 1882. The matter has been further complicated
by what I believe to be a misunderstanding of a much-quoted passage in the judgment of Atkin L. J.
in Rsx. v. Electricity Commissioners Ex parte London Electricity Joint Committee Co. He said “ ...the
operation of the “ writs [of prohibition and certiorari] has extended to control the “ proceedings of
bodies w'hich do not claim to be, and would not be “ recognised as, Courts of Justice- W herever any
body of persons “ having legal authority to determine questions affecting the rights “ of subjects,
and having the duty to act judicially, act in excess of “ their legal authority, they are subject to the
controlling jurisdiction “ of the King’s Bench Division exercised in these writs.” A gloss was pat on this
by Lord Hewart C.J. in Rex v. Legislative Committee o f the Church Assembly, Ex parte Haynes-
Smith.,.. Lord Hewart said, having quoted the passage from Lord A tkin’s judgment: “ The question
therefore which we have to ask ourselves in this case “ is whether it is true to say in this matter
either of thg Church “ Assembly as a whole, or of the Legislative Committee of the Church ‘Assembly,
that it is a body of persons having legal authority to determine questions affecting the rights of
subjects and having the duty to act jadicially. It is to be observed that in the last sentence which I
have quoted from the judgment of Atkin L. J. the word is not ‘or’, but ‘and’. In order that a body may
satisfy the required test itis not enough that it should have legal authority to determine questions
affecting the rights of subjects; there must be super-added to that characteristic the further
characteristic that the body has the'dtity to act judicially. The duty to act judicially is an ingredient
which, if the test is to be satisfied, must be present. A s these wrjt§ ia the earlier days were issued
only to bodies which without any harshness ‘of construction could be called, and naturally would he
calledi courts 31. (1942) A.C. 206; 58 T.L.R. 35. 32. (1928) 1 K.B. 411; 44 T.L.F.. 68. SECTION 4 ]
ADMINISTRATIVE FUNCTIONS 159 “ so also today these writs do not issue except to bodies which act
ot “are under the duty to act in a judicial capacity.” ..•If Lord Hewart meant that it is never enough
that a body simply has a duty to determine what the rights of an individual should be, but that there
must always be something more to impose on it a duty to act judicially before it can be found to
observe the principles of natural justice, then that appears to me impossible to reconcile with the
earlier authorities... There is not a word in Lord Atkin’s judgement to suggest disapproval of the
earlier line of authority which I have cited... 1 have already stated my view that it is more difficult for
the courts to control an exercise of power on a large scale where the treatment to be meted out to a
particular individual is only one of many matters to be considered. This was a case of that kind, and,
if Lord Atkin was prepared to infer a judicial element from the nature of the power in this case, he
could hardly disapprove such an inference when the power relates solely to the treatment of a
particular individual. The authority chiefly relied on by the Court of Appeal in holding that the watch
committee were not bound to observe the principles of natural justice was Nakkuda AU v, M.F. de S.
Jayralne.^'^ In that case the Controller of Textiles in Ceylon made an order cancelling the appellant's
licence to act as a dealer, and the appellant sought to have that order quashed. The controller acted
under a Defence Regulation which empowered him to cancel a licence, “ where the “ controller has
reasonable grounds to believe that any dealer is unfit “ to be allowed to continue as a dealer.” The
Privy Council regarded that as ‘'imposing a condition that "there must in fact exist such reasonable
grounds, known to the “ controller, before he can validly exercise the power of cancellation/’ But
according to their judgement certiorari did not lie and no other means were suggested whereby the
appellant or anyone else in his position could obtain redress even if the controller acted without a
shred of evidence. It is quite true that the judgement went on, admittedly unnecessarily, to find that
the controller has reasonable groimds and did observe the principles of i^atural justice, but the
result would have been just the same if he had not. This House is not bound by decisions of the Privy
Council and for my own part nothing short of a decision of this House directly in point would induce
me to accept the position that, although an enactment 33. (1951) A,C. 66; TX.R. (Pt. 2) 214, P.C. — —
160 INDIAN ADMINISTRATIVE LAW [ CHAPTER 3 expressly requires an official to have reasonable
grounds for his decision, our law is so defective that a subject cannot bring up such a decision for
review however seriously he may be affected and however obvious it may be that the official acted
in breach of his statutory obligation. I would sum up my opinion in this way. Between 1882 and the
making of police regulations in 1920, section 191 (4) has to be appHed to every kind of case. The
respondents’ contention is that, even where there was a doubtful question whether a constable was
guilty of a particular act of misconduct, the watch committee were under no obligation to hear his
defence before dismissing- In my judgement it is abundantly clear from the authorities I have quoted
that at that time the courts would have rejected any such contention. In later cases dealing with
different subject-matter, opinions have been expressed in wide terms so as to appear to conflict
with those earlier authorities. But learned judges who expressed those opinions generally had no
power to overrule those authorities, and in any event it is a salutary rule that a judge is not to be
assumed to have intended to overrule or disapprove of an authority which has not been cited to him
and which he does not even mention. So, I would hold that the power of dismissal in the A ct of 1882
could not then have been exercised and cannot now be exercised until the watch committee have
informed the constable of the grounds on which they propose to proceed and have given him a
proper opportunity to present his case in defence..,. Lord Morris o f Borth-y-Gest In view of the
opinions which I have expressed as to the applicability of the regulations and as to the consequences
of disregarding them, I propose only to deal briefly with the question whether, had there been no
regulations, the police authority w o u l^ have been bound to have regard to the principles of natural
ju^*'“ In my view the regulations incorporate those principles but not been any and had the police
authority in the exercise ogiven them by section 191 (4) contemplated dismissing th e/ on the
ground o f neglect of duty they would in my view under obligation to give him an opportunity to be
heard a. have had to consider anything that he might say. I cannot thz. the dismiss^ of the appellant
should be regarded as an execut. administrative act if based upon a suggestion of neglect of a before
it could be decided that tbete had beeh neglect of duty, it wovix SECTION 4 ] a d m in is t r a t iv e
FUNCTIONS 161 be pre-requisite that the question should be considered in a judicial spirit. In order
to give the appellant an opportunity to defend himself against a charge of neglect of duty, he would
have to be told what the alleged neglect of duty was. The relationship between the watch
committee and the appellant was not that of master and servant. Nor was the appellant one who
held an office at pleasure with the consequence that he could be required at pleasure to relinquish
it. He was in a different position from someone possessing a licence to do various acts. The appellant
held an office from which the watch committee should at any time dismiss him if they thought he
had been negligent in the discharge of his duty. The watch committee did not however have an
unfettered or unrestricted discretion. If it be assumed that no regulations had been made then the
fact that section 191 (4) is silent as to any procedure for a hearing does not involve that there could
be a dismissal without a hearing.... Lord Hodson My Lords, I have reached the conclusion apart from
the application of the Police A ct of 1919 and the regulations which followed, that this appeal should
succeed upon the ground that the appellant was entitled to and did not receive natural justice at the
hands of the watch committee of Brighton when he was dismissed on March 7, 1958. (His Lordship
enumerated the reasons underlying the principle of natural justice, thus:) One is that the absence of
a lis or dispute between opposing parties is not a decisive feature although, no doubt, the presence
of a lis would involve the necessity for the applications of the principles "■^•f-natural justice.
Secondly, the answer in a given case is not '^ed by the statement that the giver of the decision is
acting in ■ tive or administrative capacity as if that was the antithesis of capacity. The cases seem to
me to show that persons acting 'city which is not on the face of it judicial but rather or
administrative have been held by the courts to be subject -nciples of natural justice.... xie matter
which, to ray mind, is relevant in this case is that .e the power to be exercised involves a charge
made against the .vsou whg is dismissed, by that I ipe^n a charge of misconduct, th? 162 INDIAN
ADMINISTRATIVE LAW [ CHAPTER 3 principles of natural justice have to he observed before the
power is exercised.^^ SECTION 4 ] ADMINISTRATIVE FUNCTIONS 163 BENJAFIELD AND WHITMORE.
THE HOUSE OF LORDS AND “NATURAL JUSTICE” 37 Aust. L.J. 140(1963) The decision in Ridge v.
Baldwin at least involves the proposition that, in case similar to those considered and approved by
the House, an obligation to give a fair hearing will be implied notwithstanding statutory silence as to
the matter. It may be doubtful whether one can go beyond this and say, to paraphrase Atkin L.J.,
that such an obligation will be implied wherever there is a power to affect rights or impose
obligations. The limits to the implication of the duty to give a fair hearing will probably have to be
worked out from case to case but it is at least worth pointing out that in the very great majority, if
not all, of the cases considered by the House, the administrative authority or body in question was
obliged by its statutory authority to ascertain whether or not a particular state of facts existed
before it took action, and were not given a bare power to do an act no matter what the
circumstances might be. W hatever may be the ultimate solution of this problem, the decision of the
House of Lords leaves two areas still clouded with doubt. First, there are several cases in whicli it has
been held that the audi alteram partem rule does not apply because no “right” of a citizen has been
affected but merely a “licence” or “ privilege” withdrawn or refused. Typical cases are -R* v.
Metropolitan Police Commissioner; Ex parte Parker^^ (withdrawal of a cab driver's licence), Nakkuda
AH v. Jayratne^^ (cancellation of a textile dealer’s licence) and, in Australia, Ex parte McCarthy; Re
Milk Bodrd^’^ (refusal of a milk dealer’s licence). Despite continued criticism of the application o f
such a Hohfeldian distinction in an area of the law where it is singularly inappropriate, Lord Hodson
[in Ridge v. Baldwin'] appears to concede its validity and 34. For comments on this case see Public
Law 269 (1963); Modern L. Rev. 543-547(1963). 35. (1953) 1 W.L.R. 1150. 36. (1951) A.C. 66, 37.
(1934) 35 S.R.(N.S.W.)47, comments that he must in a given case retreat to the last refuge of one
confronted with as difficult a problem as this, namely that each case depends on its own facts.” Lord
Evershed (dissenting) also conceds that the distinction has force, while Lord Reid adverts to it
without comment. W hile, perhaps it is not enough to embed the distinction in the law. it is strong
support for the continued existence of a serious gap in the remedial law. As Lord Evershed points
out, the withdrawal of a licence may involve the destruction of a person’s livelihood. Secondly, Lord
Reid takes up the point that the status of an authority and the degree to which it is free to apply the
dictates of a policy which may be determined independently of the facts of the particular case
presented are relevant in determining what is required to constitute a fair hearing. It is vital to
realise that these same considerations must be relevant in determining whether there is any
obligation to give a hearing at all. W hat is involved in “ a fair hearing” is considered later but at the
present juncture it is necessary to point out that the higher the status of the officer concerned in the
governmental structure, and the more closely allied with the policy of government are the
considerations which he must take into account, the concept of 'a fair hearing” approaches to
vanishing point. If vanishing point is substantially reached, then one must say that there is in truth
no obligation to give a fair hearing at all. This may well be the explanation of numbers of the
decisions suggesting, for example, that the prerogative writs will not run against Ministers of the
Crown in certain circumstances and, in Austraha, against the Governor-General and State Governors.
Such cases are often put on the ground that the ultimate sanction of imprisonment cannot be put
into force against the Crown itself yet even in regard to the “persona designata'^ the remedies are
available, though none of the decisions is clear as to what is meant by “persona designata” . Clearly a
more satisfactory approach would be to judge the availability of remedies by reference to status of
the officer and the nature of the policy considerations which he must bear in mind and support for
such an approach can. be found in Lord Reid’s judgment: perhaps it is this sort of clarification which
he had in mind when he rather ambiguously said that it is incorrect to say “ that it is never enough
(to attract certiorari) that a body simply has right to determine what the rights of individuals should
be.” It would be but a short step for the courts to base their approach Qn some more predictably
b^si§ such a? that suggested by Professor 164 INDIAN a d m in is t r a t iv e LAW [ CHAPTER 3 K.C.
Davis.^*^ In his opinion, the governing distinction in situations of this nature should be one between
“ adjudicative” and “ legislative" facts. The essence of this distinction is that a hearing should always
be given as to matters pertaining directly to the parties but that, in relation to poHcy matters, the
most that could be required would be the opportunity to submit argument. The adoption of some
such distinction might well be critical for administrative law in Australia, because of the practice here
of conferring so many powers, of widely differing content, directly on the Governor-General,
Governor or senior Minister of the Crown. SECTION 4 ] ADMINISTRATIVE FUNCTION 165 PROBLEMS
1. The W orking JournaHsts, scattered all over the country, agitated for a considerable period that
their wages and salaries, dearness and other allowances, retirement benefits, rules of leave and.
conditions of service, be enquired into by some impartial authority, who would be empowered to fix
just and reasonable terms and conditions of service for them. As a result, Parliament enacted the W
orking Journalists (Conditions of Service) and Miscellaneous Provisions A ct, 1955. Sections 8 to 11 of
the A ct provided for fixation of the rates of wages for working journalists. The Central Government
was authorised to constitute a W age Board for the purpose. The circumstances which the W age
Board were to have regard to in fixing rates of wages were laid down. The decision of the W age
Board was to be published by the Central Government and it was to come into operation from a
specified date. The powers and procedure of the Board were laid down in the A ct. The decision of
the Board was to be binding on all employers in relation to newspaper establishments and every
working journalist was entitled to be paid wages at a rate in no case less than the rate of wages fixed
by the Board. The Board drew up a questionnaire and sent it to Universities, Governments, several
other organisations and individuals inter^ted in the inquiry, and to all newspapers individually., The
Baard also took evidence. Witnesses were asked to produce books ofaccounts, incom-tax
assessment orders or any other documents, which in the Board’s opinion were essential. 38. 1 Davis,
Administrative Law Treatise^ (1958) 50i5. Is the character of the Wage Board administrative,
legislative or qnasi-judicial?^® 2. Section 14 of the Punjab Municipal Act, 1911, runs as follow s; “
Notwithstanding anything in the foregoing sections of this Chapter, the State Government may, at
any time, for any reason which it may deem to affect the public interests or at the request of a
majority of the electors, by notification, direct— (e)..,[T]hat the seat of any specified member [of a
Municipal Committee] whether elected or appointed, shall be vacated on a given date, and in such
case, such seat shall be vacated accordingly, notwithstanding anything in this Act or in the rules
made thereunder.” Sec. 16 (3) lays down that a person whose seat has been vacated under Sec. 14
(e) may be disqualified for election for a period not exceeding five years. J’s seat was declared vacant
and he was also disqualified for three years, without giving him any notice or hearing. Can the
Government’s decision be challenged in a Court?^“ 3. Section 36 of the U.P. Town Area Act runs as
follows; “ If, in the opinion of the State Government, a committee persistently makes default in the
performance of the duties imposed on it by or under this or any other Act for the time being in force,
or exceeds or abuses its powers, the State Government may, by any order published, with the
reasons for making it, in the official Gazettee, declare that Committee to be in default or to have
exceeded or abused its powers; and supersede it for a period not exceeding two years as specified in
the order." The Government superseded the Town Area Committee, Sikandarpur. A member filed a
petition for certiorari in the High Court challenging the order of supersession. How would you
decide?*^ 4. Section 7 of the Punjab Small Towns A ct runs as follows : “ The State Government may
remove any member of a Committee who is in its opinion unfit to act or persistently remiss in the
discharge of his duties as a member and any person so removed shall not be eligible for election or
appointment as a member of a Committee for a period of 5 years from the date of his removal.” 166
INDIAN ADMINISTRATIVE LAW [ CHAPTER 3 39. See Express Newspapers Ltd. v. Union of India, supra
note 7. 40. See Jogindar Singh v. State of Punjab, A.I.R. 1963 Punj. 280, 41. See Iqbal Ahmed v. State
of U. P., A.I.R, 1962 All. 264. Is the function of the Government administrative?^^ 5. Under section 8
( 3 ) ( d ) of the Rice Milling Industry (Regulation) A ct, 1958, no owner of a rice mill would effect any
expansion of the rice mill except with the previous permission of the Central Government. The
statute did not lay down any factors for the guidance of the government in according sanction and
there was also no provision for appeal. W hat is the nature of the government’s function when it
sanctions the conversion of huller rice-mill into a combined shelter-huller mill under the Act?^^ 6. W
hat is the function of granting of sanction under section 197 (1) Criminal Procedure Code which
provides that when any person who is a Judge within the meaning of section 19 of the Indian Penal
Code, or when any Magistrate or public servant who is not removable from his office save by or with
the sanction of a State Government or the Central Government, is accused of any offence alleged to
have been committed by him while acting or purporting to act in the discharge of his official duty, no
Court shall take cognizance of such offence except with the previous sanction of the government
concerned?"^^ 7. Section 92 of the Civil Procedure Code runs as: (1) In the case of any alleged
breach of any express or constructive trust creative for public purposes of a charitable or religious
nature, or where the direction of the Court is deemed necessary for the administration of any such
trust, the Advocate General, or two or more persons having an interest in the trust and having
obtained the consent in writing of the Advocate General, may institute a suit, whether contentious
or not, in the principal Civil Court of original jurisdiction...within the local limits of whose jurisdiction
the whole or any part of the subjectmatter of the trust is situate, to obtain a decree— (a) removing
any trustee; (b) appointing a new trustee; (c) vesting any property in a trustee; (d) directing a trustee
who has been removed or a person who has ceased to be a trustee, to deliver possession of any
trust property in his possession to the person entitled to the possession of such property; 42. See
Negc Bal Bahadur Singh v. Lt, Governor, Him. Pr,, A.I.R. 1962 H P. 68. See Prithi Chandv. Lieutenant
Governor, Him. Pr., A.I.R. 1962 H.P, 59. 43. See /. Venugopala v. Venkata Narasimhuh, A.I.R. 1962
A.P. 363. 44. (1904) See In re. Kalagava Bapiah, I.L.R. 27 Mad. (1903) 54. SECTION 4 i a d m in is t r a t
iv e FUNCTIONS (d) directing accounts and inquiries; (e) directing what proportion of the trust
property or of the interest therein shall be allocated to any particular object of the trust; (f)
authorising the whole or any part of the trust-property to be let, sold, mortgaged or exchanged; (g)
settling a scheme; or (h) granting such further or other relief as the nature of the case may require.
Does the Advocate General in according the saction under the above provision act in an
administrative or quasi-judicial capacity?^® 8. Under Section 10 of the Industrial Disputes Act, 1947,
the government can, where it is of opinion that any industrial dispute exists or is apprehended, refer
an industrial dispute to; (a) a Board for promoting settlement; (b) to a court for inquiry; (c) to a
labour court or tribunal for adjudication. Is the function of reference quasi-judicial 9. Section 47 of
the Motor Vehicles Act, 1939 provides that a Regional Transport Authority in considering an
application for a stage carriage permit shall have regard to the following matters; (a) the interests of
the pubHc generally; (b) the advantages to the public of the service to be provided; (c) the adequacy
of other passenger transport services; (d) the benefit likely to be afforded by the service; (e) the
operation by the applicant of other transport services; (f) the condition of the roads. It shall also take
into consideration any representations made by persons already providing passenger transport
faciHties, any local or police authority. There exist provisions for appeal to a prescribed authority
and for revision by the State Transport Authority under Sections 64 and 64-A of the Act which
expressly provide for hearing to be given to the affected persons. Is the Regional Transport Authority
discharging quasi-judicial functions under Section 47 of the Act?'^^______________ _ 45. See Desraj
v, Dy. Commissioiiei\ A.LR. 1962 J, & K. 86. 46. See State of Madras v. C. P. Sarthy, A.I,R. 1953 S.C. 53.
47. See B. Rajagopala Naidn v. A.LR. 1964 S. C. 1573; New Prakash Transport Co. v. New Suwamna
Transport Co., A.I.R. 1957 S.C. 232. 168 INDIAN ad m in istrative LA W [ CHAPTER 3 10. Under Section
4 of the Indian Electricity A ct, 1910, the State Government is empowered, after consulting the State
Electricity Board, to revoke a licence, if in its opinion public interest so requires, in any of the
following cases: (a) where the licensee, in the opinion of the State Government, makes wilful and
unreasonably prolonged default in doing anything required of him by or under the Act; (b) where the
licensee breaks any of the terms or conditions of his licence the breach of which is expressly
declared by such licence to render it hable to revocation; (c) where in the opinion of the State
Government the financial position of licensee is such that he is unable fully and efhciently to
discharge the duties and obligations imposed on him by his licence. N o licence is to be revoked
unless the State Government has given to the licensee three months notice in writing stating the
grounds on which it is proposed to revoke the licence and has considered any cause shown by the
licensee against the proposed revocation. Is the function of the State Government in revoking the
licence administrative?^® 11. Consider the judgment of the Supreme Court in Pradyat K. Bose V C. J.
O f Calcutta}^ The Registrar of the High Court was dismissed by the order of the Chief Justice for
misconduct. The Registrar was given a hearing by another judge of the High Court,, who was
authorised by the Chief Justice to make an enquiry and submit a report. He then made a report
finding the Registrar guilty on some of the charges. The Chief Justice then himself held a hearing in
which the Registrar was given an opportunity to show cause why he should not be dismissed. The
Court said: “ But the exercise of the power to appoint or dismiss an officer is the exercise not of a
judicial power but of an administrative power. It is nonetheless so, by reason of the fact that an
opportuniry to show cause and an enquiry simulating judicial standards have to precede the exercise
thereof.” D o you agree? 12. According to Section 167 (8) of the Sea Customs Act, 1878, if any goods,
the importation or exportation of which is prohibited or restricted, be imported into or exported
from India contrary to such prohibition or restriction, or if any attempt be made to import or 48, See
Baranagar E, S. & I. Co. v. State of Madhya Pradesh, A.I.R. 1963 M.P.41. 49. A.I.R. 1956 S,C. 285,
SECTION 4 ] ADMINISTRATIVE FUNCTIONS 169 export any such goods, such goods are liable to
confiscation and the person concerned in any such ojffence is liable to a penalty. Discuss the nature
of the order o f a Customs authority imposing confiscation and other penalties under the above
provision 13. Do you agree with the Bombay High Court's view in GJaxo Laboratories v,
Venkateswaran^'^ that the function of the authorities in. assessing customs duties on goods under
section 87 of the Sea Customs A ct, 1878, is administrative?®^ Compare this decision with the
statement of the Supreme Court in K. T. Moopil Nair v. State of Kerala^^ that “ the assessment of a
tax on person or property is at least of a quasi-judicial character." 14. Under rule 41 of the Indian
Arms Rules, 1951, made under the Indian Arms Act, 1878, the competent authority has discretion to
renew a licence. Under the rule, however, an appeal against the refusal of the authority lies to a
higher administrative authority, and under rule 41-B the authority refusing to renew a licence is
required to record in writing its reasons for such refusal. W hat is the nature of function exercised by
the authority in refusing to renew a licence?®^ 15. Under section 3 of the Commissions of Inquiry A
ct, 1952, the appropriate Government may appoint a Commission of Inquiry for the purpose of
making an inquiry into any matter of public importance and perform such functions as may be
specified. Under section 4 of the A ct the Commission shall have the powers of a civil court, while
trying a suit under the Code of Civil Procedure, 1908, in respect of certain matters, summoning of
witnesses, production of documents, etc. By a notification the Central Government appointed a
Commission to inquire into the affairs of certain persons and companies. W hat is the nature of the
function discharged by the Commission?^® 50. East India Commrl. C o .y. Collector o f Customs, A.I.R.
1962 S. C. 1893. F. N. Roy V . Collector o f Customs, A.I.R. 1957 S.C. 648; Leo Roy v. Supdt. Dist. Jail,
Amritsar, A.I.R . 1958 S. C. 119; Pioneer Traders v. Chief Controller, Imp. & Exp., A.I.R. 1963 S. C. 734.
The Sea Customs Act of 1878 has now been re-enacted as the Customs Act, 1962. In the new Act
sections 111, 112, 113 and 114 stand for the section 167(8) of the old Act. 51. A.I.R. 1959 Bom. 372.
52. See also Gopikishen v. Collector o f Customs, A.I.R. 1961 A.P. 170. 53. AXR. 1961 S.C. 552, 559.
54. See Moti Miyan v. Commissioner, Indore Division, A.I R. 1960 M.P. 157. 55. See Allen Berry & Co.
v. Vivian Bose, A.I.R. 1960 Punj, 86. 170 INDIAN ADMINISTRATIVE LAW [ CHAPTER j 16. Section 51 of
the Madras Shops and Establishu* provides, inter alia, that if any question arises whether any
proviso, the A ct apphes to an estabhshment or to a person employed therein, it shall be decided by
the Commissioner of Labour and his decision thereon shall be final and shall not be liable to be
questioned in any court of law. Since the decision of the Commissioner has been made final, can it
be argued that he acts in an administrative capacity?®® 17. Is the obligation to hear inconsistent
with a purely discretionary function of the Administration? 18. W hat other tests have the courts
used to characterise administrative action as “ quasi-judicial ?” Can you develop some better
approach to differentiate between the three types of administrative action—legislative,
administrative and quasi-judicial ? 19. In most of the cases noted in this chapter it is suggested that
the words like "necessary and expedient” , “ public purpose” , “ opinion” , “ grounds to believe” , “
considers” show that the function is nonadjudicative. (e.g., Advani^'^ and Radeshyam^^}. But
compare the GuUapalli^^ and the Nagendra Nath^'^ cases. 20. Is it possible to separate into parts a
single process of administration and say one part is adjudicative and the other not ? In the
Radeshyam^^ case, the court said : “ Both the decisions as to the fact and as to the action to be
taken are really one and not two decisions, the determination being for the purpose of taking an
appropriate administrative decision two decisions...cannot be separated into parts with different
legal qualities.” However, in Inayat Ullah y Custodian^ Evacuee Property^^ the Supreme Court held
that, when the Custodian of Evacuee property issued a notice and then conducted an enquiry as to
whether the property was evacuee, the two parts were separate. Only the Custodian could pass
judgement on the sufficiency of information to issue a notice; the court could not. But the enquiry
could be examined by the court with a view to see whether there was sufficient material for the
authority’s decisionse c t io n 4 j a d m in is t r a t iv e f u n c t io n s 56. See Prem Sagar v, S. V. Oil
Company, A.I.R. 1965 S. C. Ill, 57. A.I.R. 1950 S. C. 222. 58. A.I.R. 1959 S. C. 107. 59. A.I.R. 1959 S. C.
308. 60. A.I.R. 1958 S. C. 398. 61. A.I.R. 1959 S. C. 107, 128. 62. AJ.R. 1958 S. C 160.

The Concept:-
Administrative actions and delegated legislations:-

Delegation of powers means those powers, which are given by the higher authorities to the
lower authorities to make certain laws, i.e., powers given by the legislature to administration
to enact laws to perform administration functions. The law legislated by the administration
with the powers given by the legislature is called delegated legislation. Or we can say that
when an instrument of a legislative nature is made by an authority in exercise of power
delegated or conferred by the legislature is called subordinate legislation or delegated
legislation.

Today in no democratic society committed to the establishment of a welfare state, the

legislature monopolizes the legislative power. It shares the same with the Executive and other
administrative organs of the state. If we look at U.K. or U.S.A. the scene is similar. In
England theoretically it is only parliament, which can make laws. Even in the United States
of America where the doctrine of the delegated legislation has not been accepted in principal,
in practice the legislature has entrusted legislative powers to the executive. As a result the
bulk of law which governs people comes from the chambers of administrators rather than
from the legislators

In order to understand the topic in a lucid manner, it is essential that we first understand what
is meant by the phrase ‘administrative action’. Is the phrase wide enough to encompass
delegated legislation? This section shall ponder over this question.

Administrative acts have been defined as under:

Those acts which are necessary to be done to carry out legislative policies and
purposes already declared by the legislative body or such as are devolved upon it by
the organic law of its existence1

1
Ex parte McDonough, 27 Cal.App.2d 155
Therefore, administrative action has to be performed by the administration by virtue of its
functions identified by the legislature, or to carry out the policies of the legislature declared
by it, or such functions which it has to perform by virtue of its existence.
Generally speaking, an administrative action can be classified into four categories:
1) Rule-making action or quasi-legislative action : It happens, and it is a
necessity, that the legislature enacts a skeletal law and leaves it to the administration
to make rules on the intricate issues involved. This power granted by the legislature is
exercised by way of delegated legislation.
2) Rule-decision action or quasi-judicial action: This is exercised by way of
administrative adjudication, where the administration is vested with authority to
determine private rights and obligations by rendering decisions involving individual
citizens.2
3) Rule-application action or administrative action: This is done by the exercise
of discretionary power vested in the administration. Thus, by the very name we may
understand that it comes into play only when the statute is not specific on the point.
4) Ministerial action: This is nothing but exercise of power in the way that is
prescribed by the enabling legislation. There is no room for discretion in this case.
This shows that administrative action as a wide phrase, which encompasses
functions resembling those of the legislature, judiciary and executive.

Unit-III
Subordinate Legislation and its Controls
3.1 Concept and Reasons for Growth
3.2. Advantages and disadvantages
3.3. Classification-Nomenclature based classification, authority based classification
(delegated legislation and sub delegation), purpose based classification, authority based
classification- ( subordinate legislation and conditional legislation)
3.4. Essential legislative functions, Constitutionality
3.5. Legislative controls
3.6 Executive Controls
3.7 Judicial control

Delegation of powers – meaning:

Delegation of powers means those powers, which are given by the higher
authorities to the lower authorities to make certain laws, i.e., powers given by the
2
NOOR Mohammed BILAL, DYNAMISM OF JUDICIAL CONTROL AND ADMINISTRATIVE ADJUDICATION, 25 (New
Delhi: Deep and Deep Publications, 2004)
 legislature to administration to enact laws to perform administration functions.
The law legislated by the administration with the powers given by the legislature
is called delegated legislation. Or we can say that when an instrument of a
legislative nature is made by an authority in exercise of power delegated or
conferred by the legislature is called subordinate legislation or delegated
legislation.

Delegated legislation is defined thus:

Legislation made by a person or a body other than the Parliament, by virtue of
powers conferred either by statute or by legislation which is itself made under
statutory powers 3.
According to one explanation Administrative Rule Making or delegated legislation (also
referred to as secondary legislation or subordinate legislation) is law made by an executive
authority under powers given to them by primary legislation in order to implement and
administer the requirements of that primary legislation (the Act under which the rules etc. are
made is also called the Parent Act).Delegated legislation is, at times, referred to as
“Ancillary”, “Subordinate”, Administrative Legislation or as Quasi-Legislation”. Several
thousand pieces of delegated legislation are made each year, compared with only a few dozen
Acts of Parliament.
It can be said to be a law made by a person or body other than the legislature but with the
legislature's authority.4
Delegated legislation Delegated (or secondary) legislation is law made by ministers under
powers given to them by parliamentary acts (primary legislation) in order to implement
and administer the requirements of the acts. It has equal effect in law although ministers
can be challenged in the courts on the grounds that specific pieces of delegated legislation
are not properly based on powers given by acts5
By this attempt to define delegated legislation it can be realized that it is a daunting task to
define delegated legislation and even tougher to delineate its
scope. Mukherjea, J. rightly says:,”Delegated legislation is an expression which covers a
multitude of confusion. It is an excuse for the legislators, a shield for the administrators and
a provocation to the constitutional jurists...”6

According to Salmond, ”legislation is either supreme or subordinate. Whereas the former

proceeds from sovereign or supreme power, the latter flows from any authority other than the

3
Y.V. Chandrachud and P.Ramanatha Aiyar, Concise Law Dictionary, 315 ( Nagpur : Wadhwa & Co., Nagpur,
2008)

4
http://en./wikipedia.org
5
The concise Oxford dictionary of politics.
6
Avinder Singh v State of Punjab (1979) 1 SCC 137
sovereign power, and is, therefore, dependent for its existence and continuance on superior or
supreme authority.”7
Delegated legislation thus is a legislation made by a body or person other than the Sovereign
in Parliament by virtue of powers conferred by such sovereign under the statute.
According to Jain and Jain8,” the term ‘delegated legislation’ is used in two senses:
(i) exercise by a subordinate agency of the legislative power delegated to it by the
legislature, or
(ii) Subsidiary rules themselves which are made by the subordinate authority in
pursuance of the power conferred on it by the legislature.
In its first application, it means that the authority making the legislation is subordinate to the
legislature. The legislative powers are exercised by an authority other than the legislature in
exercise of the powers delegated or conferred on them by the legislature itself.
This is also known as ‘subordinate legislation’, because the powers of the authority which
makes it are limited by the statute which conferred the power and consequently, it is valid
only insofar as it keeps within those limits.9
In its second condition, ‘delegated legislation’ means and includes all rules,
regulations, bye-laws, orders etc. The statute enacted by the legislature conferring the
legislative power upon the executive is known as the ‘parent Act’ or ‘primary law’, and the
rules, regulations, bye-laws, orders, etc. made by the executive in pursuance of the legislative
powers conferred by the legislature are known as subordinate laws or subsidiary laws or the
‘child legislation’.

Delegated legislation is defined with a different dimension by the Russian author Mishin 10.
He elaborates that the promulgation by governments of bourgeois countries of regulative acts
having the force of law, after these governments have been empowered to do so by
parliament.

Instead of following its normal regulative legislative procedures, parliament in cases of

delegated legislation renounces its legislative powers in favor of the government. Such an act
of delegated legislation is issued in the case of questions exclusively within the competence
of parliament. In cases of delegation of legislation, regulations may be issued not only by
governments but by any executive authorities subordinate to them, such as ministries,
departments, administrations, and bureaus. The delegation of legislative powers by
parliament to a government may be carried out directly (parliament adopts a law indicating
which body has the right to issue acts under the delegation of powers, on what questions, and
for what period) or indirectly (the parliamentary law is stated in very general terms and
cannot be implemented without the appropriate regulative activities of the executive bodies).

Delegated legislation need not be confused with administrative instructions. Government can
issue instructions in exercise of its executive power. These instructions may look very much
like rules which the government makes in the exercise of its statutory rulemaking power
which constitutes delegated legislation The instructions issued by the government under its

7
Salmond on Jurisprudence (12th Edn.)
8
JAIN AND JAIN, PRINCIPLES OF ADMINISTRATIVE LAW, (Bombay:
N.M. Tripathi , 2007)
9
D.D.BASU, ADMINISTRATIVE LAW, PAGE( place: company,1996)
10
A.A.Mishin, The Great Soviet Encyclopedia, 3rd Edition (1970-1979),(place:
The Gale Group, Inc.,2010)
executive power can supplement, but can not supplant, the statutory rules made by the
government. The executive instructions stand on a lower footing than statutory rules as they
do not have the force of Law.11

Wade in his well-known work12 stated:

“Administrative legislation is traditionally looked upon as a necessary evil, an unfortunate
but inevitable infringement of the separation of powers. But in reality it is no more difficult to
justify it in theory than it is possible to do without it in practice. There is only a hazy
borderline between legislation and administration, and the assumption that they are two
fundamentally different forms of power is misleading. There are some obvious general
differences. But the idea that a clean division can be made (as it can be more readily in the
case of the judicial powers) is a legacy from an older era of political theory. It is easy to see
that legislative power is the power to lay down the law for people in general, whereas
administrative power is the power to lay down the law for them, or apply the law to them, in
some particular situation.” There was tremendous increase in delegated legislation for various
reasons. Today, it is neither possible nor advisable to revive the old theory that it is only the
legislature that can perform legislative functions. The fact that delegated legislation has come
to stay is very evident, and no study of administrative law can be said to be complete without
accepting this ground reality. It is best to accept the doctrine of delegation of power not only
as a ‘necessary evil’ (Red Light Theory) but as a ‘requirement of the day’ (Green Light
Theory).”
In administrative law, rulemaking refers to the process that executive and independent
agencies use to create, or promulgate, regulations. In general, legislatures first set broad
policy mandates by passing statutes, and then agencies create more detailed regulations
through rulemaking. Legislatures rely on rulemaking to add more detailed scientific,
economic, or industry expertise to a policy, fleshing out the broader mandates of authorizing
legislation. For example, typically a legislature would pass a law mandating the establishment
of safe drinking water standards, and then assign an agency to develop the list of
contaminants and safe levels through rulemaking. The rise of the rulemaking process itself is
a matter of political controversy.13 Many find that obscure and complex rulemaking tends to
undercut the democratic ideal of a government that is closely watched by and accountable to
its citizens.

The Status of Delegated legislation as Law:-

The discussion on Article 13(1), (2) and (3) of the Constitution of India clarifies the
position of delegated legislation as Law. For this purpose, it is necessary to consider the
meaning of “law” and “law in force”. Art. 13(3) (a) and (b) provide:
“13. (3) (a) ‘law’ includes any Ordinance, order, bye-law, rule, regulation,
notification, custom or usage having in the territory of India the force of law; (b)
‘laws in force’ includes laws passed or made by a Legislature or other competent
11
Union of India v. Tulsiram Patel, AIR 1985 SC 1416, State of Maharashtra v.
Jagannath AIR(89 SC 1133.
12
SIR WILLIAM WADE AND C.F. FORSYTH,ADMINISTRATIVE LAW ( Oxford:
Clarendon Press,1994)
13
Ernest Gellhorn, Public Participation in Administrative Proceedings, 81 Yale L.J. 359, 371 (1972)
 authority in the territory of India before the commencement of this Constitution and
not previously repealed, notwithstanding that any such law or any part thereof may
not be then in operation either at all or in particular areas”.

Art. 13(3) (a) defines “law” very widely by an inclusive definition. It does not
expressly include a law enacted by the legislature, for such an enactment is obviously
law. The definition of law includes: (i) an Ordinance, because it is made in the
exercise of the legislative powers of the executive; (ii) an order, bye-law, rule,
regulation and notification having the force of law because ordinarily they fall in the
category of subordinate delegated legislation and are not enacted by the legislature;
(iii) custom or usage having the force of law because they are not enacted law at all.
This extended definition appears to have been given to “law” in order to forestall a
possible contention that law can only mean law enacted by the legislature.
Need and advantages:-
Delegated legislation using the expression in the popular sense has become a present-day
necessity, and it has come to stay - it is both inevitable and indispensable. The legislature has
now to make so many laws that it has no time to devote to all the legislative details, and
sometimes the subject on which it has to legislate is of such a technical nature that all it can
do is to state the broad principles and leave the details to be worked out by those who are
more familiar with the subject. Again, when complex schemes of reform are to be the subject
of legislation, it is difficult to bring out a self-contained and complete Act straightway, since
it is not possible to foresee all the contingencies and envisage all the local requirements for
which provision is to be made. Thus, some degree of flexibility becomes necessary, so as to
permit constant adaptation to unknown future conditions without the necessity of having to
amend the law again and again. The advantage of such a course is that it enables the
delegated authority to consult interests likely to be affected by a particular law, make actual
experiments when necessary, and utilize the results of its investigations and experiments in
the best way possible. There may also arise emergencies and urgent situations requiring
prompt action and the entrustment of large powers to authorities who have to deal with the
various situations as they arise.14
As Nicola Lacy has argued,
“Problems are typically seen as arising from ambiguities or ‘gaps’ in the rules, calling for
clearer interpretation or further legislative or quasi-legislative action…”15
The problems like this are dealt with through the technique of delegated legislation.
Delegated legislation is not is not a new phenomenon. Ever since the status came to be made
by Parliament, delegated legislation also came to be made by an authority to which the power
14
AIR 1951 SUPREME COURT 332 "In re Art. 143, Constitution of India and Delhi Laws Act (1912)"

A. I. R. (38) 1951 SUPREME COURT 332 (C. N. 56.),Para 90.

15
NICOLA LACY, THE JURISPRUDENCE OF DISCRETION: ESCAPING THE LEGAL PARADIGM ,(Florida: University
Press of Florida,)
was delegated by the Parliament. Going back into History one can find the Statute of
Proclamation,1539 under which Henry VIII was given extensive powers to legislate by
Proclamation. This proves the fact that there was and will always be the need for delegated
legislation. The exigencies of the modern State, especially Social and Economic reforms,
have given rise to delegated legislation on a large scale, so much so that a responsible fear
arises among the people that they are being ruled by the bureaucracy16.
The Indian Parliament enacted from the period 1973 to 1977 a total of 302 laws; as against
this the total number of statutory orders and rules passed in the same period was
approximately 25,414. Corresponding figures for States and Union Territories are not
available, but the number of rules issued under the delegated powers may well be
astronomical17.
The modern trend is that Parliament passes only a skeletal legislation. A classical example
may be the Imports and Exports (Control) Act, 1947 which contain only eight sections to
provide through the rule-making power delegated to them under legislation and leaves
everything to the administrative agencies and delegates the whole power to the administrative
agency to regulate the whole complex mechanism of imports and export. The examples may
be multiplied. This trends brings us to the need matrix of the phenomenon of delegated
legislation or administrative rule-making.
The basis of need matrix of administrative rule-making lies in the fact that the complexities
of modern administration are so baffling and intricate, and bristle with details, urgencies,
difficulties and need for flexibility that our massive legislatures may not get off to a start if
they must directly and comprehensively handle legislative business in all their plenitude,
proliferation and particularisation. Therefore, the delegation of start some part of legislative
power becomes a compulsive necessity for viability. If the 525-odd parliamentarians are to
focus on every minuscule of legislative details leaving nothing to subordinate agencies the
annual output may be both unsatisfactory and negligible. Law-making is not a turnkey
project, readymade in all detail and once this situation is grasped the dynamics of delegation
of easily follows18. From the above generalization, the factors leading to the growth of
administrative rule-making may be particularized as follows:
1. Legislation on ever-widening fronts of a modern Welfare and Service State is not
possible without the technique of delegation. It is trite but correct to say that even if
today Parliament sits all the 365 days in a year and all the 24 hours, it may not give
that quantity and quality of law which is required for the proper functioning of a
modern government. Therefore, delegation of rule-making power is compulsive
necessity. It also gives an advantage to the Executive, in the sense that a Parliament

16
Agriculture Market Committee v. Shalimar Chemicals Works, (1997) 5 SSC
516.
17
Statement for the Working paper presented by Prof. Upendra Baxi, quoted
in Avinder Singh v. State of Punjab, (1979)1 SCC 137, 160: AIR 1979 SC 321.
18
From the judgment of Krishna Iyer, J. in Arvinder Singh v. State of Punjab,
(1979) SSC 137, 147: AIR 1979 SC 321.
 with an onerous legislative time scheduled may feel tempted to pass skeleton
legislation with the details to be provided by the making of rules and regulations19.
2. Today legislation has become highly technical because of the complexities of a
modern government. Therefore, it is convenient for the legislature to confine itself to
policy statements only, as the legislators are sometimes innocent of legal and
technical skills, and leave the law-making sequence to the administrative agencies.
3. Ordinary legislative process suffers from the limitation of lack of viability and
experimentation. A law passed by Parliament has to be in force till the next session of
Parliament when it can be repealed. Therefore, in situation which require adjustment
frequently and experimentation, administrative rule-making is the only answer.
4. In situations where crises legislation is needed to meet emergent situation,
administrative rule-making is the necessity because the ordinary law-making process
is overburdened with constitutional and administrative technicalities and involves
delay.
5. In some situation it is necessary that the law must not be known to anybody till it
comes into operations. For example, in case of imposition of restriction on private
ownership, it is necessary that the law must be kept secret till it comes into immediate
operation, otherwise people could arrange their property rights in such a manner as to
defeat the purpose of the law. This secrecy can be achieved only through
administrative action because the ordinary legislative process is always very open.
6. Where government action involves discretion, i.e. expansion of public utility service,
administrative rule-making is the only valid preposition.
7. Today there is a growing emergence of the idea of direct participation in the
structurisation of law by those who are supposed to be governed by it because indirect
participation through their elected representatives more often proves a myth.
Therefore, administrative rule-making is a more convenient and effective way and
provides for this participation.
One may go on multiplying the factors responsible for the growth of administrative rule-
making, yet the list may not be exhaustive. It will suffice to say that the technique of
administrative rule-making is now regarded as useful, inevitable and indispensible20.
The Committee on Minister's Powers said, delegation is valuable because it provides
for a power of constant adaptation to unknown future conditions without the necessary of
amending legislation. Flexibility is essential. The method of delegated legislation permits of
the rapid utilization of experience... The practice, again, permits of experiment being made
and thus affords an opportunity, otherwise difficult to ensure, of utilizing the lessons of
experience
Classifications:-

19
Agriculture Market Committee v. Shalimar Chemical Works Ltd., (1997) 5
SCC 516.
20
“COMMITTEE ON MINISTERS” POWERS REPORT 45, 23, 51, 52( 1932).
 Administrative rule-making or delegated legislation in India is commonly expressed
by the term ‘statutory rules and orders’. However this classification is not
exhaustive as it appears in other forms also, i.e. regulation, notification, by-law,
scheme and direction. These terminologies are confusing because different words
are used for the same thing and same words are used for different things.
(1) Title-based classification
1. Rule: The term “rule” is defined in the General Clauses Act, 1897 as a rule made
in exercise of power conferred by any enactment and shall include a regulation
made as a “rule” under any enactment. These rules may be made applicable to a
particular individual or to the general public. It may include rules of procedure as
under the Atomic Energy Act, 1948 and also the rules of substantive law as in the
Defence of India Rules (now repealed).
2. Regulations: This term is not confined to delegated legislation. It means an
instrument by which decisions, orders and act of the government are made known
to the public. But in the sphere of administrative rule-making, the term relates to a
situation where power is given to fix the date for the enforcement of an Act or to
grant exemptions from the Act or to fix prices, etc.
3. Order: This term is used to cover various forms of legislative and quasi-judicial
decisions. Orders may be specific or genera. The former refers to administrative
action while the letters refers to administrative rule-making.
4. Bye-laws: The term has been confined to rules semi-governmental authorities
established under the acts of legislatures.
5. Directions: The terms is used in two senses. The Constitution gives powers to the
Central Government to give directions to State Government for the execution of its
laws. In this sense it has no application to delegated legislation. In the second
sense, the term “direction’ is an expression of administrative rule-making under
the authority of law or rules or orders made thereunder. These may be
recommendatory or mandatory. If mandatory, these have the force of law.
6. Scheme: The term refers to a situation where the law authorizes the administrative
agency to lay down a framework within which the detailed administrative action is
to proceed.
The “Committee on Ministers Power” has recommended for the simplification of the
nomenclature and confining the term “rule” to the statutory instrument regulating
procedure, the term “regulation” to describe the substantive administrative rule-
making and the term “order” to be confined to instruments exercising executive and
quasi-judicial decisions.
(2) Discretion-based classification (conditional legislation)
Another classification of administrative rule-making may be based on discretion
vested in the rule-making authority. On the basis of “discretion” administrative rule-
making may be classified into subordinate and contingent or conditional legislation.
This classification is linked with the leading case of Field v. Clark21. The impugned
Act authorised the President by proclamation to suspend the operation of an Act
21
143 US 649 (1892).
 permitting free introduction into the USA of certain products upon his finding that the
duties imposed upon the products of the US were reciprocally unequal and
unreasonable. The US Supreme Court upheld the validity of the Act on the ground
that the President is a mere agent of the congress to ascertain and declare the
contingency upon which the will of the Congress will prevail. The Court further held
that the Congress cannot delegate its power to make a law, but it can make a law to
delegate the power to determine some factors or state of things upon which the law
intends to make its own action depend. Therefore, contingent or conditional
legislation may be defined as a statute that provides control but specifies that they are
to go into effect only when a given administrative authority finds the existence of
conditions defined in the statute itself in subordinate legislation the process consist of
the discretionary elaboration of rules and regulations. The distinction between the two
is of ‘discretion’. Contingent or conditional legislation is fact-finding and subordinate
legislation is discretionary. In conditional legislation the gun and the gunpowder is
provided by the legislature and the administrative authority is only required to pull the
trigger but in subordinate legislation the administrative authority is to manufacture the
gunpowder also. It may be noted that this distinction is hardly real. In contingent or
conditional legislation also, a certain amount of discretion is always present. The
contingent legislation formula is a fiction developed by the U.S Court to get away
from the operation of the of the doctrine of separation of powers. It is thus obvious
that in the case of conditional legislation the legislation is complete in itself but its
operation is made to depend on fulfillment of certain conditions and what is delegated
to an outside authority is the power to determine according to its own judgment
whether or not those conditions are fulfilled. In case of delegated legislation , some
portion of the legislative power is delegated to the outside authority, in that the
legislature, though competent to perform both the essential and ancillary legislative
function, perform only the former and parts with the letter, i.e. the ancillary function
of the laying down details in favour of another authority for executing the policy of
the statute enacted. The distinction between conditional legislation contains no
element of delegation of legislative power and is, therefore, not open to attack on the
ground of excessive delegation , delegated legislation does confer some legislative
power on some outside authority and is, therefore, open to attack on the ground of
excessive delegation22.
In Emperor v. Benoari Lal23the Privy Council for the first time upheld the validity of
the Governor-General’s ordinance of special courts, which had delegated to power to
extend the duration of the ordinance on provincial governments in case of emergency,
on the ground of conditional legislation. The Privy Council observed that it was a
piece of conditional legislation as the legislation was complete and what had been
delegated was the power to apply the Act on the fulfillment of certain conditions. The
Supreme Court also in Inder Singh v. State of Rajasthan 24 upheld the validity of
Rajasthan Tenants Protection Ordinance on the ground that it is conditional
legislation. The Ordinance was promulgated for two years but Section 3 had
authorized the Governor to extend its life by issuing notification if required. In the
22
State of T.N. v. K. Sabanayagam, (1998) 1 SCC 318. See also Vasu Dev singh
v. Union of India, 89,12( SCC)753
23
AIR 1945 PC 48.
24
AIR 1957 SC 510.
 same manner in Tulsipur Sugar Co. Ltd. v. Notified Area Committee 25the Supreme
court upheld the validity of a notification issued under Section 3 of the U.P. Town
Areas Act, 1914 on the ground that is not a case of ‘subordinate legislation’ but of
‘conditional legislation’. In this case by a notification under the Act the limits of
Tulsipur town had been extended to the village Shitalpur where the sugar factory of
the plaintiff was situated. In I.T.C. Bhadrachalam Paperboards v. Mandal Revenue
Office26 the Court held that power conferred on government to bring an Act into
existence to grant exemption under it is a conditional legislation and not delegated
legislation. In Union of India v. Shree Gajanan Maharaj Sansthan27, the court was of
the view that statute providing that a certain provision thereof would come into force
on a date to be notified by the government is a conditional legislation and such a
power did not enable the government to decide whether to bring or not to bring that
provision into force. However, no mandamus can be issued against the government to
consider whether the provision should be enforced and when the government would
be able to do it.
Conditional legislation is classified into three categories: (i) Statute enacted by
legislature, future applicability to a given area left to the subjective satisfaction of the
delegate as to the conditions indicating the proper time for that purpose; (ii) Act
enforced but power to withdraw the same from operation in a given area or in given
cases delegated to be exercised on subjective satisfaction or objective satisfaction of
the delegate as to the existence of requisite condition precedent;(iii) power exercisable
upon the delegate’s satisfaction on objective facts by a class of persons seeking
benefit of the exercise of such power to deprive the rival class of persons of statutory
benefits. Last category of conditional legislation attracts principles of natural justice 28.
Thus, though delegated legislation as such did not attract the principle of natural
justice but it applies in the case of conditional legislation where a person is deprived
of his statutory rights.
(3) Purpose-based classification
Another classification of administrative rule-making would involve the consideration
of delegated legislation in accordance with the difference which it is made to serve.
On this basis the classification may be as follows:
1. Enabling Act: Such Acts contain an “appointed day” clause under which the
power is delegated to the executive to appoint a day for the Act to come into
operation. In this category, the legislature prescribes the gun and the target and
leaves it to the executive to press the trigger. It is aimed at giving the executive the
time to equip itself for the administration of the law. In this class of legislation,
rule-making exercise is valid only to the extent it is preparatory to the Act coming
into force29.

25
(1980) 2 SCC 295.
26
(1996) 6 SCC 44.
27
(2002) 5 SCC 44.
28
State of T.N.v. K. Sabayagam (1998) 1 SCC 318.
29
Venkataswaraloo v. Supdt. Of Central jail, AIR 1953 SC 49.
2. Extension and Application of Act: The technique of administrative rule-making
may sometimes be used for extension and application of an Act in respect of a
territory or for a duration of time or for any other such object. Power may be
delegated to extend the operation of the Act to other territories. For example,
Section7 of part ‘c’ States Laws Act delegates power to the Central Government to
extend to any part ‘c’ State, with such restrictions and modification as thinks fit,
any enactment which is in force in any part ‘a’ State. The extension procedure has
been extensively employed in ‘reciprocal legislation’. The power may also be
delegated to extend the duration of a temporary Act which is to come to an end at
a fixed period. Sometimes power may be given to extend the operation of the Act
to object or persons other than those for which it was originally made. The Tea
District Emigrant Labour Ac, 1932 authorised the Central Government to extend
the provision of this Act to any other land and premises in Assam.
3. Dispending and Suspending Act: Sometimes the power may be delegated to the
administrative authority to make exemptions form all or any provision of the Act
in a particular case or class of cases of territory, when, at the discretion of the
authority, circumstances warrant it. Section 8 of the Stage-Carriages Act, 1861
delegated power to provincial government to exempt any carriage or class of
carriages from all or any provision of the Act. In the same manner, the Indian
Registration Act,1908 delegate power to the State Government to exempt any
district or tract of land from the operation of this Act. These exemption clauses are
meant to enable the administration to relieve hardship which may be occasioned as
a result of uniform enforcement of the law. However, delegation of such power in
order to be valid, must satisfy the test of Article 14 of the constitution. Power may
also be delegated to suspend the operation of any Act.
4. Alteration Acts: Though technically speaking any alteration amounts to
amendment, yet alteration is a wide term and includes both modification and
amendment. In Indian legislative practice the power to modify Acts has mostly
been delegated as a sequel to the power to extension and application of laws.
Power to modify has also been given to administrative authorities in cases which
may be described as ’legislation by reference’. It is a device by which the power of
modification is delegated to make the adopted Act fit into the adoptive Act.
Section 21 of the Excess Profits Act, 1940enacts that the provisions of the sections
of the Income Tax Act, 1922 named therein shall apply with such modifications as
may be prescribed by rules. The power of modification is limited to consequential
changes, but if overstepped it suffers challenge on the ground that is not within the
legislative intent of modification. Another type of alteration may be classified as
‘amendment’. The most common example is the power to change the Scheduled of
an Act. Courts have held the exercise of such provide as valid provided that the
changed items are ejusdem generis with the other items mentioned in the
Scheduled to which the law clearly applies. Power to make alteration may
sometimes include the power to ‘remove difficulty’ so that the various statutes
may coexist. This power may include the power to amend to repeal the enabling
Act as well as Acts. This type of delegation may be classed as an exceptional type
of delegation and, therefore, must not be used except for the purpose of bringing
the Act into operation. A classical example of this type of delegation is the
Merged States Laws Act, 1949 which delegates power to any court or any
authority to make such alteration in the specified Act, not effecting the substance,
as may be necessary and proper to adapt it to any matter at hand. Such a wide
 power cannot be defended because the dividing line between ‘matter’ and
‘substance’ is very thin.
5. Taxing Acts: Normally the purpose, incidence and rate of tax must be determined
by the legislature. However, the courts have upheld the delegation of taxing
powers to the administrative authorities provided the policy of the taxing statute
has been clearly laid down.
6. Supplementary Acts: Under the classification power is given to administrative
agencies to make rulers to elaborate, supplement or help to work out some
principles laid down in the Act. In other words the power is delegated to the
authority to make rules ‘to carry out the purpose of the Act’. The Defence of India
Act, 1939 empowered government ’to make such rules as appear to be necessary
or expedient for securing the defence of British India, public safety, maintaining
public order, efficient prosecution of war, maintaining supplies and services
essential to the life of the community’. Such wide powers were also delegated to
the government under the Essential Commodities Supplies Act,1946.
7. Approving And Sanctioning Acts: Under this try of legislation power is delegated
not to make rules but to approve the rules framed by other specified authority.
8. Classifying And Fixing Standard Acts: Under this type of delegation, power is
given to the administrative authority to fix standard of purity , quality or fitness for
human consumption. Courts hade upheld the validity of this type of delegation on
the ground of necessity.
9. Penalty For Violation Acts: sometimes power may be delegated to an
administrative agency to prescribe punishment for the violation of rules. In the
USA, the penalty for violation of administrative rules can be fixed by congress.
Making an Act penal is a Congress function and cannot be delegated to the
administrative agency. However, in England there are some instances where
power to impose penalty has been delegated. The London Traffic Act, 1924
provides that the administrative authority may provide, by regulation, the fines
recoverable summarily for breaches thereof.
10. Clarify the Provisions of the Statute Acts: in this case power is delegated to the
administrative authority to issue interpretations on various provision of enabling
Act. The United State Treasury Department has been delegated the power to issue
interpretations on various phases of taxation. However, these regulations are not
binding on anyone. They are in the form of opinions of departmental guidance.
But in some there cases they are final and binding.
(4) Authority-based classification (sub-delegation)
Another classification of administrative rule-making is based on the position of the
authority making the rules. Sometimes the rule-making authority delegates to itself
or to some other sub-authority a further power to issues rules; such exercise of
rule-making power in known as sub-delegated legislation. Rule-making authority
cannot delegates its power unless the power of delegation is contained in the
enabling Act. Such authorization may be either express or by necessary
implication. If the authority further delegates its law-making power to some other
authority and retains a general control of a substantial nature over it, there is no
 delegation as to attract the doctrine of ‘ delegatus non potest delegare’. The
maxim ‘ delegatus non potest delegare’ indicates that sub-delegation of power is
normally not allowable though the legislature can always provide for it. Courts
have always taken the position that sub-delegation invalid unless authorised by the
parent Act. A classical illustration is A.K.Roy v. State of Punjab30. In this case the
power to initiate prosecution for offences under section 20(i) of the Prevention of
Food Adulteration Act,1954 had been given to the State Government. The Act had
not authorized sub-delegation of power. Nevertheless under Rule 3 of the
Prevention of Food Adulteration (Punjab) Rules, 1958, the power of prosecution
was delegated to the Food Inspector. The court held sub-delegation as ultravires
the parent Act. In State v. Amir Chand 31 the court further held that authorization of
sub-delegation must be express, it cannot be inferred. Under the Employees State
Insurance (Central) Rules,1950, Rule 16(2) had provided for two types of sub-
delegations: (i) Director- General was empowered to delegate the powers
conferred on him by the said rules; (ii) Director- General was further empowered
to delegate his powers and duties under any resolution of the corporation or the
standing committee. The court held sub-delegation in the second case as invalid on
the ground that conferment of powers of duties under a resolution of the
corporation could be by way of delegation to the corporation and empowering the
Director- General to further delegate such powers is impermissible32 .
The Essential Commodities Act,1955 provides a unique example of
sub-delegation at where sub-delegation is authorized at two stages. Section 3 of
the Act empowers the Central Government to make rules but Section 5 authorizes
sub-delegation of powers to the State Governments who have been further
empowered to sub-delegate powers to their officers.
It is now almost settled the legislature can delegates its powers of
law-making after indicating the policy. Therefore, the maxim delegatus non potest
delegare which means that a delegate cannot further delegate is not attracted in
case of delegation by the legislature but certainly applies in case of sub-delegation.
The maxim was originally invoked in the context of delegation of judicial powers
and implied that in the entire process of adjudication a judge must act personally
except in so far as he is expressly absolved from his duty by statute. Therefore,
basic principle behind the maxim is that a discretion conferred by the statute on an
authority must be exercised by that authority alone unless a contrary intention
appears from the language, scope or object of the statute. However, keeping in
view the imperatives of modern administration courts are slow in applying the
maxim when there is question of exercise of administrative discretionary powers33.

30
(1986) 4 SCC 326. See also Ganpatiji v. State of Ajmer, AIR 1955 SCC188;
Ajaib Singh v. Gurbachan Singh, AIR 1965 SC 1619; Naraindas v. State of M.P.
(1974) 4 SCC 788; Barium Chemical Ltd. v. Company Law Board, AIR 1967 SC
295; Sahini Silk Mills (P) Ltd. v. ESI Corpn., (1994) 5 SCC 346.
31
AIR 1953 Punj. 1.
32
ESI v. T. Abdul Razak, (1996) 4 SCC 708.
33
Sahini Silk Mills (P) Ltd. v. Corpn. , (1994) 5 SCC 346.
 The mechanism of sub-delegation makes parliamentary control illusory,
postpones the rule-making process and makes publication of rules difficult,
therefore it must be resorted to only in unavoidable circumstances. It is again this
backdrop that the committee on Subordinate Legislation in India suggested that
sub-delegation in very wide language is improper and some safeguard must be
provided before the delegate is allowed to sub-delegate his authority.
(4) Nature –based classification (exceptional delegation)
Classification of administrative rule-making may also be based on the nature and
extent of delegation. The Committee of Minister Power distinguished two type of
parliamentary delegation:
1. Normal Delegation:
A. Positive:- Where the limits of delegation are clearly defined in the enabling
Act.
B. Negative:- Where power delegated does not include power to do certain things,
i.e. legislate on matters of policy.
2. Exceptional delegation: Instances of exceptional delegation may be:
(i) Power to legislate on matters of principle.
(ii) Power to amend Acts of Parliamentary.
(iii) Power conferring such a wide discretion that it is almost impossible to
know the limits.
(iv) Power to make rules without being challenged in a court of law.
Such exceptional delegation is also known as Henry VIII clause to
indicate executive autocracy. Henry VIII was the King of England in the
16th Century. He imposed his autocratic will through the instrumentality of
Parliament, so he described as a “despot under the forms of law”. Under
this clause very wide powers are given to administrative agencies to make
rules, including the power to amend and repeal. Instances of exceptional
delegation may be found in Section 20 of the States Reorganisation Act,
1956 (now repealed) where power was given to the executive to make
changes in the existing law. This type of delegation is delegation running
riot. Even extraordinary conditions do not justify delegation outside the
sphere of constitutional authority.
A classical illustration of Henry VIII clause is found in the
Constitutional itself. Under article 372(2) the President has been delegated
the power to adapt, amend and repeal any law in force to bring it in line
with provision of the Constitution and the exercise of such power has been
made immune from the scrutiny of courts. The court also found Henry VIII
clause in regulation 34 of the West Bengal State Electricity Regulation
which had authorised the Board to terminate the services of any permanent
employee on three months notice or pay in lieu thereof. The Supreme
Court observed that the naked “hire and fire” rule of Regulation 34 is
 parallel to Henry VIII clause so familiar to administrative lawyers34.
Exceptional delegation has always been held to be ultra virus the
Constitution.

The shift from acceptance of administrative legislation to evolution and

development of controls:-
With the independence of India, the philosophy of Welfare state was made the
creed of the Indian Constitution. It has been laid down in the preamble of the constitution that
it aims at establishing a sovereign socialist, secular, democratic republic, so as to secure to all
its citizens, social, economic and political justice, liberty of thought, expression, belief faith
and worship, equality of status and opportunity and to promote among them fraternity,
assuring dignity of the individual and the unity of the nation.
All legislative actions of the administrative have been expressly brought by the
Constitution within the purview of Article 13 by defining 'law' as including 'order', Therefore
the rule making action of the administration can be challenged not only on the ground that it
is ultra vires the delegating statute but also on the ground that it violates the fundamental
rights guaranteed under the Constitution.15 Thus, within the fabric of tremendous growth in
the administrative process in almost every field an effective control mechanism has been
woven.
Besides the growth of administrative process, which is possible through legislation
and executive actions, the Constitution itself provides for the establishment of some
administrative agencies to regulate a particular field i.e. Article 263, Inter State Water
Dispute Authority, Article 315, Public service Commissions of India; and Article 324,
Election Commission.
Today in India, the administrative process has grown so much that it will not be out of
place to say that today we are not governed but administered. In this context the Law
Commission of India rightly observed.
"The rule of law and judicial review require greater significance in a Welfare State...
the vast amount of legislation which has been enacted during the last three years by the Union
and the States, a great deal of which impinges in a variety of ways on our lives and
occupations. Much of it is also confers large powers on the executive. The greater therefore is
the need for ceaseless enforcement of the rule of law, so that the executive may not, in a
belief in its monopoly of wisdom and in its zeal for administrative efficiency, overstep the
bounds of its power and spread its tentacles into the domains where the citizen should be free
to enjoy the liberty guaranteed to him by the Constitution.18

34
W.B. State Electricity Board v. Desh Bandhu Ghosh, (1985) 3 SCC 116;
Central Inland Water Transport Corp. v. B.N. Ganguly, (1986) 3 SCC 156.
1515
Dwarka Prasad Laxmi Narain v. State of U.P, AIR 1954 SC 224; Zafar Ali Shah (Dr.) v. Asstt. Custodian of
Evacuee Property, AIR 1967 SC 106; Bidi Supply Co.v. Union of India, AIR 1956 SC 479, State of Bombay v.
Bombay Education Society AIR 1954 SC 561; Kameshwar Prasad v. State of Bihar, AIR 1962 SC 1166; Mervyn v.
Collector of Customs, AIR 1967 SC 52; Kharak Singh v. State of U.P., AIR 1963 SC 1295; Maneka Gandhi v. Union
of India,(1978) (SCC 248: AIR 1978 SC 597.

1818
FOURTEENTH LAW COMMISSION REPORT, Vol. II, p 672
 Observations of Law Commission are no less relevant today when India has adopted
the policy of liberalization, privatization and globalisation in which administrative law has
developed international dimensions. Though State is now withdrawing from business, yet its
functions as a facilitator enablor and regulator are bound to increase. Growth of new centers
of economic power which often exercise power in total disregard of the fundamental rights of
the people especially of the disadvantaged sections of the society will put emphasis on the
development of new norms of Rule of Law and judicial review for reconciling economic
growth with social justice.
On the one hand the judiciary has taken up the task to conform the administrative law making
to the Constitutional parameters on the other hand the Legislature which is the conferring
body has also developed an independent machinery to pave way for a just delegation of
power and to ensure that the delegated legislation which will be evolves by the executive as
the end product of the process should not ne excessive. Legislature is coming up with
providing appropriate system of consultation and publication to ensure participation of people
in the framing of executive laws. Apart from these many other newly devised ways of
controls over the administrative law making are also functional.

Unit- IV

Administrative Discretion

4.1 Introduction, definition, meaning

4.2 Difference between different kinds of functions of administrative process
4.3 Ministerial and discretionary powers
4.4 Legislative Control
4.5 Executive Control
4.6 Judicial Control

ADMINISTRATIVE DISCRETION ; ITS EXPANDING HORIZON

A. Introduction
Discretion is a science or understanding to discern between falsity and truth, between
rightand wrong, between shadows and substance,between equity and colourable glosses
andpretences, and not to do according to their wills
and private affections.It has already been emphasised in the previous pages that
with the abandonment of laissez faire and advent of the modern philosophy of a “welfare”
and “social service” state, theadministrative organ, in practically every democratic country, is
more and more functions, and is thus increasingly
impinging on the citizen. The administration has acquired large powers and the trend cannot
be said to have abated as yet. The main tasks of the administrative organ are no longer merely
police or political; it performs vast regulatory and managerial functions.
Formerly the various power of administration were broadly classified
as legislative, quasi-judicial and administrative. No scheme of
classification of powers is really satisfactory.
The administrative powers are of varied types. They range
from such simple matters as registration of births and deaths, to
regulate of a business activity, acquiring property for a public
purpose and detaining a person on the subjective satisfaction of the
executive. The administrative powers are also include such
important powers as of investigation, seizing or destroying the
property of an individual without hearing in the interest of public
health, safety and morality. The types of administrative powers are
too numerous to be mentioned here. Broadly speaking
administrative powers of the administration are : evolving and
79
implementing policies; execution of laws, applying vague standards
laid down in statutes or delegated legislation from case to case
A significant phenomenon of the present-day administrative
process, is conferment of discretionary powers on administrative
personnel to take decisions from case to case. There is a tendency
in all democratic countries that legislation, conferring powers on the
executive is usually drafted in broad and general terms; it leaves
large area of choice to the administrator to apply the law to actual,
specific and factual situations, that is, from case to case, and does
not specify clearly the conditions and circumstances subject to
which, and the norms with reference to which the executive must
use the powers conferred on it.
Because of the complexity of socio-economic conditions which
the administration in modern times has to contend with, the range of
ministerial functions is very small and that of discretionary functions
"j
much larger. It is realised that a government having only ministerial
duties with no discretionary functions will be extremely rigid and
unworkable and that to some extent, officials must be allowed a
choice as to when, how and whether they will act. The reason for
this attitude is that more often than not, the administration is required
to handle intricate problems which involve investigation of facts,
making of choices and exercise of discretion before deciding upon
what action to take. Thus, the modern tendency is to leave a large
amount of discretion with various authorities.
Discretion is the all-pervading phenomenon of modern age.
Discretion is conferred in the area of rule-making or delegated
legislation, e.g. when the statutory formula says that the government
may make rules which it thinks expedient to carry out the purposes
of the Act, in effect, abroad discretion and choice are being
conferred on the government to make rules. The legislature hardly
gives any guidance as to what rules are to be made. Similarly,
discretion is conferred on adjudicatory, and administrative authorities
on, a liberal basis, that is, the power is given to apply a vague
statutory standard from case to case. But this development is
disquieting because, according to a well known adage, “absolute
power corrupts absolutely”, and therefore, broad powers present
possibilities of being misused and exercised in an arbitrary manner.
The broader the discretion, the greater the chance of its abuse. In
the words of Justice Douglas of the U.S. Supreme Court. “Where
discretion is absolute, man has always suffered... Absolute
discretion... is more destructive of freedom than any of man’s other
inventions”.1 And also : Absolute discretion like corruption, marks
the beginning of the end of liberty.”2 It thus becomes necessary to
devise ways and means to minimise the danger of absolute
discretion, so that injustice is not done to any single individual. It is
not possible for this purpose to depend merely on the good sense of
administration itself to use its power properly, for broad power
always breeds the danger that will wielder will get power drink.
Courts have to play a major role in the process of controlling the
functioning of the administration. In this connection the fundamental
rights guaranteed by the Indian Constitution play a significant role.
The judicial control mechanism of administrative discretion is
exercised at two stages. First at the stage of delegation of
discretion. At this stage, the court may compel the legislature to
desist from conferring too broad or uncabined discretionary powers.
In India, the courts have sought to spell out some limits on
conferment of broad discretionary powers by invoking the
Fundamental Rights guaranteed by the constitution. The courts may
1 United State v. Wander Lick, (1951) 342 US 58 at 101.
2 New York v. United State (1951) 342 US 882 at 884.
declare a statute unconstitutional if it seeks to confer too large a
discretion on the administration. Fundamental Rights in India thus
afford a basis to the courts to control the bestowal of discretion to
some extent, by testing the validity of the law in question on the
touchstone of Fundamental Rights. This may involve some
substantive and procedural safeguards in the exercise of the
powers. The courts may imply some substantive limits on the
power. They may imply some procedural safeguards i.e. an
adjudicatory body being required to follow natural justice. In other
cases the relevant law may lay down some procedural norms.
Second at the stage of the exercise of discretion. There is the need
to have some post-decisional review mechanism to ensure that
administrative authorities discharge their functions according to law
and within legal limits express or implied. To some extent, this
important role is discharged by the courts. The courts control the
exercise of discretion by the administration and for this purpose have
evolved several norms. This aspect is discussed in another chapter
in this study under judicial control of Administrative Discretion.3
Today, the question of control of discretionary power is perhaps
most crucial and Critical problem of the modern administrative law.
Functions dischargeable by the administration may either be
“ministerial” or “discretionary".
B. Ministerial Functions
In politics “ministerial’ is commonly used as - an epithet
appertaining to ministers or, more broadly, to the party in office. We
speak of ministerial responsibility, ministerial cheers. As a technical
legal term it has no single fixed meaning.
It may describe any duty, the discharge of which involves no
element of discretion or independent judgement. Thus, a ministerial
function is one where the law prescribes the duty to be performed by
the administrative authority in certain and specific terms leaving
nothing to the discretion or judgment of the authority, it does not
involve investigation into disputed facts or making of choices. The
authority concerned acts in strict obedience to the law which
imposes on it a single and definite duty in respect of which it has no
choice.According to Kair and Lawson4:“Many of the acts performed by public
authorities or public officers are done in strictobedience to rules of statute or common law
which imposes on them a simple and definite
duty in respect of which they have no choice.”Gordon classifies the functions of
administrative authoritiesinto judicial and non-judicial. Judicial functions involve the
decisionof rights and liabilities so that an investigation and application of fixed legal
standards was a material part of the functions. Nonjudicial functions are further divided into
administrative and
ministerial functions. Ministerial functions are exercised by taking
active, often coercive measures, and administrative functions by
meeting out policy and expediency with unfettered discretion. When
an administrative agency is acting ministerially it has no power to
consult its own wishes but when it is acting administratively its
standards are subjective and it follows its own wishes.5
Since an order of mandamus may be issued to compel the
performance of a ministerial act and since, moreover, wrongful
refusal to carry out a ministerial duty may give rise to liability in tort, it
is often of practical importance to determine whether discretion is
present in the performance of a statutory function. An example of
non-discretionary function is furnished by section 35 of the Income Tax Act.
Keirs Lawson, case in constitutional Law (1967) p. 4 20.
Gordon D.M., Administrative Tribunals and the Courts, (1933)49 LQR 94, 419.
Tax Act, 1922. This provision stated that the Income tax officer
could rectify any mistake apparent from the record. The Supreme
Court in Hirday Narain v. Income Tax Officer6 rules that this
provision did not give any discretion to the Income tax officer to
exercise or not to exercise the power to rectify. It was implicit in the
nature of the power that it would be exercised by the Income Tax
Officer when a mistake apparent from the record was brought to his
notice by the concerned person. Even if the words used in the
statute are prima facie enabling, the courts will readily infer a duty to
exercise power which is invested in aid of enforcement of a right of a
citizen.
In Kavita v. State of Maharashtra7 it was held that the task of
referring the question of detention of a person to an advisory board
under the COFEPOSA was a mechanical or ministerial act, involving
no exercise of discretion, though the government had the full liberty
to revoke the order of detention at that stage (as at all other stages).
However, the presence of a minor discretionary element is not
enough to deter the courts from characterizing a function as
ministerial. Thus, the issue of a warrant for the non-payment of
taxes has been held to be a ministerial act (and therefore not
reviewable by certiorari) although the officer issuing the warrant had
discretionary power to take proceedings in the courts for recovery of
the taxes.8 The Supreme Court in Sharif Ahmad v. Regional
Transport Authority, Meerut9, regarded the function ministerial where
the appellate tribunal ordered the R.T.A. to grant a permit to each of
the applicants on the production of a roadworthy vehicle and an
affidavit to the effect that he had not been convicted for an offence
6 AIR 1971 SC 33.
7 AIR 1981 SC 1641.
8 Metherington V. Security Export Co. (1924) A.C. 988.
9 AIR 1978 SC 209.
under the Indian Penal Code during the last five years. The courts
stated that "the minor discretionary element given to it (R.T.A.) for
finding out whether the terms of the Appellate Order had been
complied with or not is not enough to deter the courts from
characterizing the function as ministerial.”10 Such application after
the orders of the Appellate Tribunal cannot be said to remain,
‘pending” within the meaning of the statute; what remained pending
was merely a ministerial act to be performed by the R.T.A. Again,
where an authority has erroneously declined ‘jurisdiction over a
matter or has failed to exercise a discretion according to proper legal
principles, the issue of mandamus to it has sometimes been
represented as a remedy for breach of a ministerial duty, although
the determination of such questions may be far from a mechanical
operation.
The term ministerial is often used more narrowly, to describe
the issue of a formal instructions, in consequence of a prior
determination which may or may not be of a judicial character, that
direct action be taken in relation to another’s person or property.11 It
may describe the execution of such an instruction by an inferior
officer (who is sometimes called a ministerial officer).
It is sometimes used loosely to describe any act that is neither
judicial nor legislative In this sense the term is used interchangeably
with “executive" or “administrative”12. So, the functions of an
assessment committee, the making of slum, clearance and
compulsory orders under housing legislature and the assessment of
charges to be imposed on the inhabitants of a district in a country
have all been called ministerial, although their most obvious
See Gordon D.M., Administrative Tribunals and the Courts, (1933) 49 LQR at 9
See Haridas v. Khan (1971)1 W.L.R. 507, 512.
characteristics is that they involve the exercise of discretionary
powers. This use of the term is misleading. However, here, the
term has been used to refer to the making of decisions, the issue of
orders or the execution of acts in which the element of judgement or
discretion is either absent or relatively very small.
C. Administrative Discretion.
Discretion in layman’s language means choosing from
amongst the various available alternatives without reference to any
predetermined criterion, no matter how fanciful that choice may be.
A person writing his will has such discretion to dispose of his
property in any manner, no matter how arbitrary or fanciful it may be.
But the term “discretion” when qualified by the word "administrative”
has somewhat different overtones. ‘Discretion’ in this sense means
choosing from amongst the various available alternatives, but with
reference to the rules of reason and justice and not according to
personal whims. Such exercise is not to be arbitrary, vague and
fanciful but legal and regular. Lords Halsbury in sharp v. Wakefield13
rightly observed :
“Discretion means when it is said that something
is to be done within the discretion of the
authorities that something is to be done
according to the rules of reason and justice, not
according to private opinion ...according to law
and not humour. It is to be, not arbitrary, vague
and fanciful, but legal and regular. And it mqst
be exercised within the limit, to which an honest
man competent to the discharge of his office
ought to confine himself’...14.
Professor Freund15 has defined “administrative discretion” in the
following words:
(1891) AC 173.
Administrative Powers over Persons and Property, (1928) p. 71.
“When we speak of administrative discretions
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.”
Thus, in short, here the decision is taken by the authority not
only on the basis of the evidence but in accordance with policy or
expediency and in exercise of discretionary powers conferred on that
authority. For Coke once said that discretion is a science or
understanding to discern between falsity and truth, between right
and wrong, and not to do according to will and private affection.
The legal'concept of discretion implies power to make a
choice between alternative courses of action.16 If only one course
can lawfully be adopted, the decision taken is not the exercise of a
discretion but the performance of a duty.
(i) Conferment of discretion
Discretion is conferred in the area of rule-making or delegated
legislation, e.g. when the statutory formula says that the government
may makes rules which it thinks expedient to carry out the purposes
of the Act. In effect, a broad discretion and choice are being
conferred on the government to make rules. Similarly, discretion is
conferred on adjudicatory and administrative authorities on a liberal
basis, that is, the power is given to apply a vague statutory
standards from case to case.
Rarely does the legislature enact a comprehensive legislation
complete in all details. More often the legislation is sketchy or
skelton, leaving many gaps and conferring powers on the
administration to act in a way it deems "necessary" or “reasonable"
16 Davis, Discretionary Justice (1969) p. 4.
or if it “is satisfied” or “is of opinion”. Rarely does the legislature
clearly enunciate a policy or a principle subject to which the
executive may have to exercise its discretionary powers. Quite often,
the legislature bestows more or less an unqualified or uncontrolled
discretion on the executive. Administrative discretion may be
denoted by such words or phrases as “public interest”, “public
purpose”, “prejudicial to public safety or security”, “satisfaction,"
“belief, “efficient”, “reasonable” etc.
Thus, there is no set pattern of conferring discretion on an
administrative officers. Freund an American Scholar says in this
regard'.
A statute confers discretion when it refers an official for the use of
his power to beliefs, expectations or tendencies instead of facts, or
to such terms as ‘adequate’, ‘advisable,’ ‘appropriate’, ‘beneficial’,
‘competent’, ‘conversant’, 'detrimental', ‘expedient’, ‘equitable’, ‘fair’,
‘fit’, ‘necessary’, ‘practicable’, ‘proper’, ‘reasonable’, ‘reputable’,
‘safe’, ‘sufficient’, ‘wholesome’, or their opposite. These lack the
degree of certainty... They involve matter of degree or an appeal to
judgment. The discretion enlarges as the element of -future
probability preponderates over that of present conditions; it contracts
where in certain types of case quality trends to became
standardized, as in matters of safety; on the other hand, certain
applications of the concepts of immorality, fraud, restraint of trade,
discrimination or monopoly are so controversial as to operate
practically like matter of discretion.17
It is true that with the exercise of discretion on a case to case
basis, these vague generalizations are reduced into more specific
moulds, yet the margin of oscillation is never eliminated. Therefore,
17 Freund, Administrative Powers over Person and Property. (1923) p. 71. List
given above has been further added to.
the need for judicial correction of unreasonable exercise of
administrative discretion cannot be over emphasised.

(ii) Need of discretion

Because of the complexity of socio-economic conditions which
the administration in modern times has to contend with, it is realised
that a government having only ministerial duties with no
discretionary functions will be extremely rigid and unworkable and
that, too some extent, officials must be allowed a choice as to when,
how, and whether they will act. The reason for this attitude is that,
more often than not, the administration is required to handle intricate
problems which involve investigation of facts, making of choices and
exercise of discretion before deciding upon what action to take.
Thus, the modern tendency is to leave a large amount of discretion
with various authorities. Statute book is now full of provisions giving
discretion of one kind or the other to the government or officials for
various purposes.
The need for ‘discretion’ arises because of the necessity to
individualize the exercise of power by the administration, i.e. the
administration has to apply a vague or indefinite statutory provision
from case to case. There are following good reasons for conferring
discretion on administrative authorities :
(a) 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;
(b) 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.
(c) 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
to the situation’,
(d) Circumstances differ from case to case so that applying one rule
mechanically to all cases may itself result in injustice.
However, from the point of view of the individual, there are
several disadvantages in the administration following the case to
case approach as compared to with the adoption of a general rule
applicable to all similar cases. First, whereas case to case decisions
operate on the past facts, a general rule usually avoids retroactivity
and operates in future so that one has prior notice of the rules and
thus may regulate his conduct accordingly. In 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. Second, 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. Third, the process is time consuming and involves
decision in a multiplicity of cases. Also, there is a danger of abuse
of discretion by administrative officials.
In view of these manifold disadvantages, a general rule is to
be preferred to the case to case approach and ought to be adopted
wherever possible. It is desirable to have administrative uniformity
to the extent possible, because, as a matter of general principle,
substantial lack of uniformity would lead not only to administrative
chaos but also to collapse of public confidence in administrative
fairness. In any individual case, it is highly relevant to take into
account what has been done in other cases of a similar nature,
otherwise a decision may result which could be regarded as being
improper or discriminatory. This objective can be advised by several
ways viz.
First, law conferring discretion may itself seek to lay down the
elements and standards which the authority has to apply in
exercising its discretion and selecting a course of action. This
means that the degree of discretion should be restricted by law itself
as far as possible, or, in other words discretion should be properly
“confined and structured”.19
Two, if a statute leaves a large amount of discretion in the
hands of administration, the administration itself lay down criteria
with respect to which the discretion is to be exercised. !t would help
in predicting administrative decision in individual cases, thus, making
individual’s rights somewhat certain and reducing chances of abuse
of administrative discretion. It would also help in uniform application
of the law in a large number of cases which may have to be handled,
especially when a number of parallel and co-equal administrative
authorities have to cope with cases arising under a particular
scheme.
Three, on a lower plane, to some extent administrative
discretions and norms of practice can be used, instead of the rules,
for the purpose of achieving uniformity in discretionary decisions, but
these should be resorted to only when the scheme is too much in an
experimental stage and constant adjustment may have to be made
for sometime to come otherwise rules are preferable to directions as
they can be enforced judicially.20 But it needs to be emphasized that
while laying down standards make the discretion somewhat less
than absolute, no amount of rules or directions can really eliminate
the need for discretion because administration functions in a very
broad area and individual cases and situations are bound to arise
which may fall outside the guiding norms and the administration will
have to take some decision therein. Not all acts of the
administration can be bound by fixed rules. Many a time, it may not
be possible to prescribe it intelligible standards for the administration
to follow. All these considerations makes it inevitable that discretion
be vested in the administration to take care of individual cases. But
it also brings in the question of judicial and other dontrol over
discretionary powers.
(iii) No Unfettered discretion
It is true that in any intensive form of government, the
government cannot function without the exercise of some discretion
by the officials. It is necessary not only for the individualization of
the administrative power but also because it is humanly impossible
to lay down a rule for every conceivable eventuality in the complex
art of modern government. Thus, a trend very much in vogue to-day
in all democratic countries is that only a relatively small part of the
total legislative output emanates directly from the legislature. Rarely
does the legislature enact a comprehensive legislation complete in
all details. More often, the legislation is sketchy or skelton, leaving
many gaps and conferring powers on the administration to act in a
way it deems, necessary. This technique of conferring discretionary
powers on administration is so extensively resorted to in modern
times as a process of government that there is hardly any statute
passed by the legislature to-day which does not confer some
discretionary powers on administration. The statute book is now full
of provisions giving discretion of one kind or the other to the
government officials for various purposes. Rarely* does the
legislature clearly enunciate a policy or a principle subject to which
the executive may have to exercise its discretionary powers. Quite
often, the legislature bestows more or less an unqualified or
uncontrolled discretion on the executive.
But it is equally true that absolute discretion is a ruthless
master. It is more destructive of freedom than any of main’s other
inventions.21 Therefore, there has been a constant conflict between
the claims of the administration to an absolute discretion and the
claims of subjects to a reasonable exercise of it. Discretionary
power by itself is not pure evil but gives much room for misuse.
Therefore, remedy lies in tightening the procedure and not in
abolishing the power itself.
Thus, today question is not whether discretionary powers to
administrative authorities is desirable or not but what controls and
safeguards can be introduced so that unfettered or unqualified
discretion could not be conferred and discretionary powers could not
be misused by government officials. It thus, becomes necessary to
devise ways and means to minimise the danger of absolute
discretion. To achieve such an objective, a multi-pronged strategy
has to be adopted. Courts have to play a major role in this process.
While the notion of “unfettered discretion" is acceptable to the
English Courts due to the operation of the doctrine of sovereignty of
Parliament, it would be inconsistent with the constitutional framework
of judicial control in India. The Indian Constitution guarantees
certain Fundamental Rights to the people which constitute a
limitation on the legislative and executive powers of the government
and consequently, these rights provide an additional dimension of
control over administrative discretion. The courts in India, in addition
to controlling the exercise of administrative discretion on the same
ground as the courts in England, also use Fundamental Rights to
Dougies in United States v. Wanderlich (1951) 342 45.98 at 101
control discretionary powers of administrative authorities in two
ways; (i) The courts may declare a statute unconstitutional if it seeks
to confer too large a discretion on the administration. Fundamental
Rights in India thus afford a basis to the courts to control the
bestowal of discretion to some extent, by testing the validity of the
law in question on the touchstone of Fundamental Rights. For this
purpose, the courts can take into account both procedural and
substantive aspects of the law in question. At times, the courts may
imply certain safeguards into the law to hold it constitutionally valid;
(ii) The courts may control the actual exercise of discretion under a
statute by invoking certain fundamental Rights, especially Article 14.
This aspect is considered in another chapter under Judicial Control
of Administrative Discretion.22
The courts have generally attempted to control the bestowal of
discretion to promulgate legislation through the doctrine of
“excessive delegation”.23 Correspondingly, the courts have also
developed the doctrine of "excessive delegation of discretionary
power” by "invoking certain" Fundamental Rights. However, the
judiciary has shown much greater difference to legislation involving
conferment of power of delegated legislation than of administrative
discretion. In the former case, courts have often been satisfied with
vague or broad statements of policy and have even upheld statutes
where policy was not apparent. But the courts have adopted a more
critical attitude in the matter of scrutinizing statutes conferring
administrative discretion with reference to Fundamental Rights. The
reason is that delegated legislation being a power to make an order
of general applicability presents less chance of administrative
arbitrariness than administrative discretion which is applied from
(See In re Delhi Laws Act case, AIR 1951 SC 332.)
case to case. The courts have shown tolerance to conferment of
large discretionary powers when there are some procedural
safeguards available to regulate the exercise of the power, e.g., the
right of hearing
(a) Article 14 of the Constitution and Administrative Discretion :
one of the constitutional bulwark against unfettered or uncontrolled
discretion in Indian law is article 14 of the constitution which provides
for the principles of ‘equality before the law’ and ‘the equal protection
of laws’. This constitutional provision condemns discrimination; it
forbids class legislation, but permits classification founded on
intelligible differential and having a rational relationship with the
object sought to be achieved by the Act in question. Article 14 is
buttressed by Article 15 expressly prohibiting discrimination on
grounds of religion, race, caste, sex or place of birth, Article 16
states positively that there shall be equality of opportunity in matters
of public employment. ‘Unfettered discretion’ is liable to be used in a
discriminatory manner and this is offensive to Article 14.
The general principle is that conferment of an arbitrary,
sweeping, uncontrolled or unfettered discretion on an administrative
authority violates Article 14 as it creates the danger of discrimination
among those similarly situated which is subversive of the equality
doctrine enshrined in Article 14. Mr. Justice Fazl Ali24 said in state of
West Bengal v. Anwar Ali. 1
“An Act which gives uncontrolled authority to
discriminate cannot but be hit by Article 14”.
Similarly, in Satwant Singh v. Assistant Passport officer,25
where refusal of passport was hold violative of Article 14, the issue
of passports being governed entirely by discretion, the Supreme
court observed :
in the case of unchannelled arbitrary discretion,
discrimination is writ large on the face of it.
Such a discretion patently violates the doctrine
of equality, for the difference in the treatment of
persons sets solely on the arbitrary selection of
the executive”26
In state of West Bengal v. Anwar Ali,27 in order to speed the
trial for certain offences, Section 5(1) of the West Bengal Special
Courts Act, 1950 conferred discretion on the State Govt, to refer any
offence for trial by the special court. Since, the procedure before the
special court was stringent in comparison with that for normal trials,
the respondents asserted its unconstitutionality on the ground that it
violates the equality clause in Article 14. The court held the law
invalid on the ground that the use of vague expressions like
“speedier trial", confers a wide discretion on the Government and
can be a basis of unreasonable classification. The Act was held
violative of Article 14 because it had empowered the government to
select any case or a class of cases or offences to be tried by the
special courts. This unfettered discretion is likely to be branded
discriminatory and therefore, contrary to Article 14.
Section 65 A of the Bihar and Orissa Co-operative Societies
Act, 1935 which conferred blanket powers on the State Government
to decide matters contemplated under the Act, even including quasi
judicial matters was held to be violative of Article 14.28
In S. Kandaswamy Chettiar v. State of Tamil Nadu29 the
Maharashtra vacant Lands (Prohibition of unauthorized occupation
and Summary Eviction) Act, 1955, which was passed for prohibiting
26 Id. at 1967.
27 AIR 1952 SC 75.
28 State of Meharashtra v. Kawal S. Durgule, AIR 1985 SC 119.
29 (1985)1 See 290.
96
unauthorised occupation of vacant lands and for providing summary
eviction of unauthorised occupants, conferred upon the competent
authority the discretion to declare a land as vacant land without
laying down any policy as a guidance for the exercise of such
discretion. The Act was therefore held to be violative of Article 14.
Discretion was conferred on the State Government by the Tamil
Nadu Building Lease and Rent Control Act 1960 to exempt buildings
from the Act. This provision was uphold in Kesoram & Co. v. Union
of India.30
Similarly, in state of Kerala v. M/s Travencore Chemicals
Manufacturing Co.,31 Section 59A of Kerala General sales Tax Act,
1963 conferring wide and unbridled power was held to be violative of
Article 14. It is a well established principle of Indian administrative
Law that too broad, uncontrolled discretionary power ought not to be
conferred on administrative authorities, for uncontrolled or unguided
power falls foul of Article 14. This principle finds reiteration in
several cases. In Sheo Nandan Paswan v. State of Bihar,32
Bhagwati C.J. observed :
"It is significant to note that the entire
development of administrative law is
characterised by a consistent series of decisions
controlling and structuring the discretion
conferred on the state and its officers. The law
always frowns on uncanalised and unfettered
discretion conferred on any instrumentality of the
state and it is the glory of administrative law that
such discretion has been through judicial
decisions structured and regulated.”33
The preceding discussion shows that the court would enquire
whether the statute contains the policy or principles for guiding the
(1989) 3 SCC 151.
AIR 1999 SC 230.
AIR 1987 SC 877.
Id. at 895.
97
exercise of discretion by the executive in the matter of classification
and if it does not the statute is liable to be invalidated as having
conferred “unfettered” discretion to discriminate between persons or
things similarly situated.34 If a statute does not disclose a definite
policy or objective, subject to which the discretion conferred by it is
to be exercised, then the statute is bad as being discriminatory.35
However, the wisdom of legislative policy is not open to judicial
review but when the wisdom takes the concrete form of law it must
be in tune with the fundamental rights of the constitution.
So long as the policy itself is not discriminatory36 legislation
would be upheld if its purpose or policy to guide the exercise of
discretion is manifest. On that basis Preventive Detention Act,37
Minimum wages Act,38 Industrial Dispute Act,39 Suppression of
Immoral Traffic Jin women and Girls Act40 etc. have been upheld.
However, even if the legislation is valid an administrative action
purportedly authorised by the legislation could be discriminatory and
invalid.41
Though, the principle is clear and well established that
unguided or arbitrary power cannot be conferred on the
administration, yet its application by the courts to various factual
situations bristles with difficulties. In order not to hamper
administrative action too much, the courts show flexibility in their
approach and difference to the legislative will; at times, they uphold
legislation even when the policy to guide the discretion is not definite
Sathe S.P., Administrative Law (1984) p. 271.
B.N. Chettiar v. Central Govt. AIR 1976 Mad. 224.
A. L. Kalra v. P & E Corpn. Of India Ltd., AIR 1984 SC 1361.
Kedarnath v. State of W. B„ AIR 1953 SC 404.
Bhikusa Yamasa v. Sanagammar Kamgar Union, AIR 1963 SE 404.
Bhiksa Yamasa v. Union of India, AIR 1963 SC 1591.
State of U.P. v. Kaushaliya, AIR 1964 SC 416.
Ram Krishan Dalmia v. Tendulkar, AIR 1958 SC 538.
or clear but somewhat vague and inarticulate.42 The courts have
also held that it is not necessary that the policy be stated in the
specific statutory provision which confers discretion on the
administration, and that it would meet the needs of the situation if
the same is ascertainable from the preamble and the long title of the
Act in question. These few propositions lead to the result that it is
only in a rare case that a court would be persuaded to hold a law to
be discriminatory. This can be illustrated by following few cases.
In State of Punjab v. Khan Chand43, the truck of Sh. Khan Chand
was requisitioned by the District Magistrate, Rohtak for famine relief
work. He challenged the constitutionality of the East Punjab
Requisition of Movable Property Act, 1947 on the ground that it
violates the provisions of Article 14 of the constitution. The supreme
Court struck down the law empowering the executive to requisition
movable property. The court held that the Act confers wide
discretionary powers upon authorities by not layirig down the
guidelines for requisitioning movable property. Even the words
“public purpose” are not used. Therefore arbitrariness and power to
discriminate are writ large on the face of the Act and fall within the
mischief which Article 14 seeks to prevent. It would be wrong to
assume an element of judicial arrogance in the judicial behaviour
striking down the statute.
In Manohar Lai v. State of Maharashtra,44 Section 187. A of
the Sea Customs Act gave wide discretionary power to the
authorities to either refer a case of smuggled goods to a magistrate
or to look into the matter themselves. The court upheld the validity
of the statute on ground that as this discretion is to be exercised by
AIR 1974 SC 543.
AIR 1971 SC 1511.
senior officers that will stand as a guarantee against its misuse. This
kind of judicial behaviour aimed at preserving wide discretionary
powers may ultimately end up in destroying it.
In Summan Gupta v. State of J & K45 with.a view to encourage
national integration certain state governments agreed as a matter of
policy to reserve certain seats in medical colleges for outside
candidates nominated by the respective state government on a
reciprocal basis. The Supreme Court struck down the vesting of
power of nomination in the state governments as the nomination
was left to their unlimited discretion and uncontrolled choice.
In Monarch Infrastructures v. Commr. Ulhasnagar Municipal
Corporation,46 the Municipal Corporation had invited tenders for
appointment of agents for the collection of Octroi. However one of
the eligibility condition was deleted after the expiry of the time for
submission of tenders but before opening thereof. ; Thereafter,
tender was awarded to one who did not fulfil the deleted condition.
The Supreme Court held award of tender arbitrary and
discriminatory.
However, if a statute confers wide powers but contains
procedural safeguards, then it can be upheld as valid. Thus, in Tika
Ramji v. State of U.P.47 section 15 of the U.P, sugarcane Act, 1953
gave to the cane commissioner, after consulting the factory and
cane growers co-operative society, power to reserve any area and
assign any area for the purpose of supply of cane to a factory. An
appeal against such an order lay to the government. The power
given to the commissioner was held not bad under Article 14 as it
AIR 1983 SC 1235.
(2000)5 SCC 287; See also Mohd. Riazul Usman Gans v. Distt. And Session
Judge, (2000)2 SCC 606.
AIR 1956 SC 676. 47
was well defined and contained safeguards against its exercise in a
discriminatory manner.
Organo Chemicals Industries v. Union of India,48 is an
important case on this area. Section 14-B of the1 employees
‘Provident Funds Act’, 1952 provides that where an employer makes
default in the payment of any contribution to the fund, the Central
Provident Fund Commissioner may recover from the employer such
damages, not exceeding the amount of arrears, as he may think fit to
impose. Before imposing damages, the employer is to be given a
reasonable opportunity of being heard. The broad power given to
the commissioner was upheld by the Supreme Court mainly because
the law in question was social in nature and beneficial to the labour.
However, the court adopted the following formal arguments to
uphold the commissioner’s vast power to impose damages. The
power is to be exercised according to natural justice and, as such,
he has to make a speaking orders; such an order is subject to Art.
226, so that perversity, illiteracy, extraneous influence, mala fides
and blatant infirmities straight away get caught and correct”. In,
awarding damages he usually takes, into consideration, as he has
done here, various factors viz. the number of defaults, the period of
delay, the frequency of defaults and the amounts involved.” Again in
Gopikishan v. Assistant Collector of Customs,49 the power of
assistant Collector of Customs to order search of the premises of a
person if had reason to believe that the person had in his
possession goods liable to be confiscated was upheld as he was
required to send forthwith a copy of any record made by him to the
collector, and he could be prosecuted if he took action without
“having reason to believe”
49 AIR 1979 SC 1803.
AIR 1967 SC 1298.
The Supreme Court may read the procedural requirement of
hearing into a statute to save it from unconstitutionality under Article
14. Thus, in State of Mysore v. Bhat,50 where a law authorised the
competent authority to declare an area a slum area, to declare
houses unfit for human habitation and declare a slum area as a
clearance area the court read natural justice into the law to uphold it
under Article 14.
In Maneka Gandhi v. Union of India51, section 10(3) of the
passport Act, 1967 empowered the Central Government to impound
a passport of a person in public interest. There was no appeal
against the order of the government and the words “in the interests
of the general public" were appeared to be vague and undefined.
But the court upheld the provision by reading the requirement of
natural justice and because the words in question could not be
characterised as vague and undefined as these very words are to be
found in Article 19(5). These words provide sufficient guidelines to
the government and its power cannot be regarded as unguided and
unfettered, the reasons for impounding the passportlf;are to be
recorded in writing and copy thereof is to be given to the affected
person save in certain exceptional circumstances; the power is
vested in a high authority, and according to the court when power is
vested in a high authority like the Central Government, abuse of
power cannot be legally assumed.”
Although Article 14 has established itself as the constitutional
basis for demanding judicial review in a way that is familiar to
American lawyers i.e. that discretion be structured by rules
standards and policies, the degree of judicial review exercised on
this basis has swung between two extremes of a pendulum. In
50.AIR 1975 SC 596.
51.AIR 1978 SC 597.
some cases the courts have rejected the standards provided by the
statute as “vague and uncertain” and condemned the enabling Act
as having conferred unguided discretion while in other cases they
have handed the executive a free hand by saying that a discretion
vested in a high ranking officials is presumed to be exercised bona
fide.52 Sometime they have accepted even a vague policy as
i
sufficient for the purpose when the same has been given in the
preamble of the statute concerned or in general objective of the
statute.53 Thus, in state of W.B. v. Anwar Ali,54 the West Bengal
Special Courts Act, 1950 which authorised the state government to
direct a special court to try “any offence or cause” under a’;procedure
substantially different from the ordinary criminal procedure to
determent of the accused declared in its preamble that th,e object of
the Act was” to provide for the speedier trial of certain offences”. It
was held that the necessity for a “speedier trial” was too vague and
uncertain to form a rational basis of classification. By contrast
speedier trial related to the object of the statue such as . “public
safety" and ‘maintenance of public order in a dangerously disturbed
area’ has been accepted a sufficiently certain.55 Similarly in Kathi
Ranning v. State of Saurashtra56 a provision practically similar and
parallel to the one involved in the Anwar Ali case was held valid
because the court found that the policy was stated in the preamble
to the Act.
In union of India v. Annan Ramalingam,57 the courts upheld
the validity of Section 28 of the Gold Control Act, 1968 against
attack on the ground that it provided no criteria or guidelines for the
52 V. C. Shukla v. State, AIR 1980 SC 962.
53 Pannalal v. Union of India, AIR 1957 SC 397.
54 AIR 1952 SC 75.
55 Gopichand v. Delhi Administrative, AIR 1959 SC 609.
56 AIR 1952 SC 123.
57 AIR 1985 SC 1014.
exercise of his power by the administrator. Section 28 barred a
licensed dealer, unless authorised by the administrator, to carry on
business as a moneylender or banker on the security of ornaments
or any other article. Although no express rule prescribing the
conditions or circumstance for grant of power had beemprescribed,
that was not decisive of the matter. Section 28 being a part and
parcel of the entire scheme of gold control as envisaged by the Act
"the object of the enactment and the scheme affords sufficient
guidance to the Administrator in the matter of exercising his
discretion under that section”. Section 28 is designed to prevent
circumvention of other provisions of the Act. Against the
administrator’s order a revision lies to the central government ‘which
implies that he will have to make judicious use of his power or
discretion and any improper exercise of power or discretion is liable
to be corrected by a higher authority.”
But in B.B. Rajwanshi v. State of Uttar Pradesh,58 the
Supreme Court adopted a stricter attitude. In that case section 6(4)
of the U.P. Industrial Disputes Act, 1947 authorised the State
Government to remit an award of a Labour Court or Tribunal for
reconsideration of the adjudicating authority and that authority was
to submit the avtfard to the government after reconsideration. The
Supreme Court noted that Section 6(4) did not require the
government to hear the parties before remitting the award to the
concerned adjudicating authority; the government was not required
to give reasons for remitting the award; the government was not
required to inform the authority the specific points on which it was to
reconsider the award. The Supreme Court declared the provision
unconstitutional under Article 14. The court observed : “The
58 AIR 1988 SC 1089.
provision cannot be upheld in the absence of necessary statutory
guidelines for the exercise of the power conferred by it haying regard
to the fact that the proceeding before the Labour Court or the
Industrial Tribunal is in the nature of quasi-judicial proceeding where
parties have adequate opportunity to state their respective cases, to
lead evidence and make all their submission”. Section 6(4) was so
widely worded that it was likely to result in grave injustice to a party
in whose favour an award was made as Sec. 6(4) could be used to
re-open the whole case. Sec. 6(4) conferred “unguided and
uncontrolled powers” on the State Government. The power could be
used arbitrarily to favour one party over the other; the power was
capable of serious mischief.59 The court refused to accept the
argument that the government could seek necessary guidance from
the object and content of the Act.
In some cases, the Supreme Court has justified the
conferment of large discretionary power on the executive on the
ground that power had been conferred on a high ranking official or
body which was not likely to abuse the power. Thus, in
Commissioner of Sales Tax v. Radhakrishan,60 the court stated :
Where power is conferred on high and
responsible officers they are expected to act
with caution and impartiality while discharging
their duties... The vesting of discretionary power
in the State or public authorities or an officer of
high standing is treated as a guarantee that the
power will be used fairly and with a sense of
responsibility.”61
Thus in Manoharlal v. State of Maharashtra62 Section 187-A of
the sea Customs Act giving powers to the custom authorities either
Id. at 1096.
AIR 1979 SC 1588
AIR 1971 SC 1511.
to refer a case of import of prohibited goods to a magistrate or
themselves to confiscate the same and impose fine has been upheld
on the ground that the power has been conferred on the chief
Customs Officer or other senior officer and there is sufficient
guidance in the object and purpose of the Act to exercise the power.
Again in Accountant-General v. Doraiswamy.63 The Supreme
Court would trust the comptroller and Auditor General with discretion
because of his ranking constitutional status.
It is a myth to say that the power vested in high officials is not
apt to be misused as there are many cases on record where the
court itself has found some fault with the exercise of power by high
officials or even central or state government. This appears to be a
very tenuous basis to support conferment of broad powers, in
Mohinder Singh Gill v. Chief Election Commissioner64 the Supreme
Court has itself warned that “...wide discretion is fraught with
tyrannical potential even in high personages, absent legal norms
and institutional checks". Thus, the sooner the court discards the
argument of validating broad discretion because of the high rank of
the donee of the power the better it is for the growth of
Administrative Law in India.
In Niemla Mills Ltd. v. Second Punjab Tribunal65 Section 10(1)
of the Industrial Disputes Act, 1947 which empowers the government
to refer an industrial dispute to a board for settlement, or a court of
enquiry or a tribunal for adjudication has been upheld. The court
took the view that ‘No two cases are alike in nature and the industrial
disputes which arise or are apprehended to arise in particular
establishment or undertakings require to be treated having regard to
AIR 1981 SC 783.
AIR 1978 SC 851.
AIR 1957 SC 329.
the situation prevailing in the same. There cannot be any
classification and the reference to one or the other authorities has
necessarily got to be determined in the exercise of its best
discretion’’66 The general objectives of the statute have been held to
be sufficient in controlling the power of the government.
In re Kerala Education Bill case,67 the Kerala Education Bill
gave broad powers of control to the Kerala Government over private
schools in the state, as for example, power to recognise newly
established schools, power to take over any category of schools in
any specified area through a notification. These provisions were
challenged as being discriminatory on the ground that they were
capable of being exercised “with an evil eye and unequal hand".
The Supreme Court held that the clauses of the bill had to be
interpreted and read in the light of the general policy laid down in the
preamble namely to provide for better development of education in
the State.
Article 14 has thus proved to be a valuable tool in restraining
what has been termed in English law “unfettered discretion”. Thus,
the courts have demanded that discretion must not be arbitrary.
Absence, of standards, policies and principles to guide the exercise
of “absolute discretion” is liable to render the resultant administrative
action open to challenge.
(b) Reasonable Restrictions under Article 19 of the Constitution
and Administrative Discretion :
Another constitutional bulwark against uncontrolled or
unfettered discretion is Article 19. Article 19(1) of the constitution
guarantees the following rights to citizens : (a) freedom of speech
and expression; (b) freedom to assemble peacefully and without
66
67
AIR 1958 SC 956
arms; (c) freedom of association; (d) freedom to move freely
throughout the territory of India; (e) freedom to reside and settle in
any part of the country; and (f) freedom to practice or carry on trade
or business.68 These are not, however, absolute freedom. These
rights are subject to reasonable restrictions69 which the state may
impose for the purposes specified in clauses (2) to (6) of article i.e.
national security, foreign affairs, public order, decency, public
interest etc. The "reasonableness” of the restrictions envisaged in
article 19 is determined by the courts.70 In other words a wide range
of civil liberties is taken out of the reach of “unfettered discretion” of
the executive. While determining the reasonableness of restrictions
under Article 19, the Supreme Court has insisted that the power
conferred on the executive should not be arbitrary, or discriminatory
and that an “unfettered discretion” left to the executive would be
inconsistent with Article 19. Thus, in State of Madras v. V.E. Row,71
section 15(2) (b) Criminal Law Amendment Act, 1908 as amended
by Madras Act, 1950 gave wide discretionary power to the State
Government to declare any association as unlawful. The court struck
down section 15(2) (b) as being unconstitutional because it allows
the administrative authority to exercise this discretion on subjective
satisfaction without permitting the grounds to be judicially tested.
In State of Bihar v. K.K. Mishra72, clause (6) of Section 144
Criminal Procedure Code gave discretionary power to state
Government to extend the life of an order passed by the magistrate
beyond the period of two months if it considered it necessary for
preventing danger to human life, health and safety or for preventing
68 The Constitution (Forty fourth) Amendment Act, 1978 amended Article 19
deleting the freedom to acquire, hold and dispose of property.
69 Krishan Kakanath v. Govt, of Keral, AIR 1997 SC 128 at 135.
70 Chintaman Rao v. State of MP, AIR 1951 SC 118.
71 AIR 1952 SC 196.
72 AIR 1971 SC 1667.
riot or an affray. The Supreme Court held clause (6) of Section 144
unconstitutional as it invests the administration with blanket
discretionary power which is capable of being exercised arbitrarily,
and hence would amount to unreasonable restriction on the exercise
of freedom.
However, discretion is not open to constitutional objection if -
(a) the circumstances or the grounds on which it can be exercised
are state; or (b) if the law lays down the policy of the discretion; or
(c) if there are adequate procedural safeguards in law against the
possible abuse of discretion.73 Thus in Virendra v. State of Punjab74
a law which empowered the executive to impose restrictions on
freedom of the press if the executive were ‘satisfied that such
restrictions were necessary to combat any activity prejudicial to
maintenance of communal harmony was upheld as valid because
under it an aggrieved person could make a representation to the
court. For similar reasons in commissioner Hindu Religious
Endowment v. Lakshmindra,75 a scheme framed by an executive
officer for administration of endowed property was held valid
because an aggrieved could bring an action in the ordinary court
with a further appeal to the High court.
However, uncontrolled discretion, i.e. discretion not guided by
rules, principles or policy, is liable to be struck down as infringing
Article 19 rights. Thus a rule requiring an exhibitor of films to show
at each performance approval films of such length and for such
length of time as the government might direct was held
unreasonable as the government had been vested with 'unregulated
discretion’ as regards length and time of exhibition and length of the
Sathe, S.P. Administrative Law (1991) p. 314.
AIR 1957 SC 896.
AIR 1954 SC 282.
film.76 Statutory Power to determine from time to time the maximum
sale price of a certain type of rice in the discretion of the Director of
Food was held invalid for the same reason.7'
H.R. Banthia v. Union of India.78 The Gold Control Act, 1968
invested administrative authority with blanket discretionary to grant
or refuse licence to any dealer in gold ornaments. Though the Act
had provided that such power was to be exercised with reference to
the number of existing dealers, anticipated demand, suitability of the
applicant and public interest, the court struck down the law on the
ground that such vague expressions may result in the arbitrary
exercise of power.,
In Himat Lai K. Shah v. Police Commissioner,79 Rule 7 under
Section 44 of the Bombay Police Act, 1951 gave unguided
discretionary power to the police commissioner to grant or refuse
permission for any public meeting to be held on public street. The
Supreme Court struck down Rule 7 as being an unreasonable
restriction on the exercise of a fundamental right.
The Court would have regard to the safeguards in the relevant
statute and the nature of the administrative act in question in order
to determine the reasonableness of restrictions under Article 19. In
M/S Diwan Sugar Mills C. Ltd. v. Union of India,80 a price-fixing order
was upheld because the prices fixed were neither below the cost of
production, nor arbitrary. The Central Government was required to
give consideration to the factors specified in the enabling Act. This
was accepted by the court as sufficient safeguards against abuse of
power.

Seshadri v. District Magistrate, AIR 1954 SC 747.

Hari Ram Paras Ram v. State of Haryana, AIR 1982 P & H 108.
AIR 1970 SC 237.
AIR 1973 SC 87.
AIR 1959 SC 626.
The Supreme Court has been prepared to concede a great
deal of latitude to administrative actions that are called for in the
interest of general public. Thus in Cooverji v. Excise
Commissioner,81 the Excise Commissioner was empowered to grant
licences on payment of such fees, for such period, subject to such
restrictions, on such conditions, in such form and containing such
particulars as he might direct either generally or in particular. In
State of M.P. v. Bharat Singh82, the M.P. Public Security Act, 1959
invested the District Magistrate or the State Government, with wide
discretion, uncircumscribed by procedural safeguards, to extern a
person from any area and to interm him in any specified place if his
activities were prejudicial to the security of state or maintenance of
public order. The Supreme Court held the relevant provision
unconstitutional on the ground that it invests the government with
such wide discretion without procedural safeguards that a person
could even be interned in a place which could render him a destitute
without any means of livelihood.
In State of Maharashtra v. Kamal S. Durgule83, the legislature
had given the power to the competent authority to declare a land
vacant and then to acquire it. The power had given without laying
down any guidelines for the exercise of this discretion and no
provision had been made of any notice and hearing to the owner.
Quashing Sections 3(1) and 4(1) of the Land Acquisition Act, the
Supreme Court held that because law confers arbitrary powers on
the government, hence it violates Article 14 of the constitution. The
court further observed that the fact that the exercise of this power
has been given to officers of high echelon makes no difference to
81
82
83
AIR 1954 SC 220.
AIR 1967 SC 1170; See also State of M.P. v. Baldeo Pol., AIR 1961. SC 293.
AIR 1985 SC 119
the position and is hot a palliative to the prejudice which is inherent
in the situation. When discretionary power is conferred on an
authority, there must be a provision for a corrective machinery by
way of appeal or revision to superior authority to rectify an adverse
order passed by the lower authority. By an amendment in 1976 of
the Industrial Disputes Act, 1947 it was provided that if an employer
was intending to close down his factory, he had to obtain the
previous approval of the government which could refuse to give
permission if it was of the opinion that the reasons for the closure
were not sufficient or the closure was prejudicial to public interest. In
Excel Wear v. Union of India,84 the amendment was struck down,
inter-alia, on the ground that the authority could whimsically and
capriciously refuse permission to close down the factory and the
order was not subject to any scrutiny by any authority or tribunal
either in appeal or revision.
But in Babuhai & Co. v. State of Gujarat85 it was held by the
court that if certain other ways are available to check or control the
discretionary power then mere absence of a corrective machinery by
way of appeal or revision would not render the provision invalid. The
court observed that absence of such a machinery may indicate that
the power so conferred is unreasonable or arbitrary but that
providing such a machinery is only one of the several ways in which
the power could be checked or controlled and its absence is one of
the factors to be considered alongwith several others before coming
to the conclusion that the power so conferred is unreasonable or
arbitrary; mere absence of a corrective machinery by itself would not
make the power unreasonable or arbitrary. Some of the factors to
be considered in this connection are mentioned by the court as
84
85
AIR 1979 SC 25,
AIR 1985 SC. 613.
follows; on whom the power is conferred. Whether on a high official
or petty officer; what is the nature of power whether its exercise
depends on subjective satisfaction of the authority or is to be
exercised objectively by reference to some existing facts or test;
whether or not it is a quasi-judicial power requiring the authority to
observe principles of natural justice and make a speaking order?
The last factor ensures application of mind by the authority only to
pertinent or germane material on the record excluding extraneous or
irrelevant material and also subjects the order of the authority to
judicial review under writ jurisdiction on such grounds as perversity,
extraneous influence, mala fides and other infirmities. The court has
observed in this connection.
“Moreover all these factors will have to be
considered in the light of the scheme of the
enactment and the purpose intended to be
achieved by the concerned provision. If on an
examination of the scheme of the enactment as
also the purpose of the concerned provision it is
also found that the power to decide or to do a
particular thing is conferred on a very minor or
petty officer, that the exercise thereof by him
depends on his subjective satisfaction, that he is
expected to exercise the power administratively
without any obligation to make a speaking order
than, of course the absence of a corrective
machinery will render the provision conferring
such absolute and unfettered power invalid. But
if the commutative effect of all these factors that
will render the provision unreasonable or
arbitrary and liable to be struck down”86
Thus, in the instant case, Section 54 of the Bombay Town
Planning Act, 1954 vesting power in the Municipal Corporation to
summarily evict persons in occupation of lands required for
implementing the final town planning scheme was held valid on the
86 The Court made the reference in' this connection to Oranges Chemicals
Industries v. Union of India, AIR 1979 SC 1803.
J
following grounds : (i) the power is vested in the local authority which
is a highly responsible body; (ii) the power is required to be
exercised in an objective manner; (iii) power conferred is quasijudicial
and so the eviction orders are to be passed after hearing the
parties and through a speaking order which implies giving of reasons
and which also ensures application of mind to only germane or
relevant material on record eschewing extraneous or irrelevant
material; (iv) any order of summary eviction based on any extremes,
non-germane irrelevant or malafide considerations would be subject
to the writ jurisdiction. Having regard to these aspects mere
absence of a corrective machinery by way of appeal or review would
not render the provision invalid.
On the whole, it appears that the administration enjoys a good
deal of flexibility and it is difficult to challenge successfully in a court.
Wide and vague factors laid down in the statutory provisions for the
guidance of the administrative authority have been upheld. Even a
general statement of policy in the parent Act has been accepted.
In certain situations, the statute though it does not give
discretionary power to the administrative authority to take action,
may give discretionary power to frame rules and regulations
affecting the rights of citizens. The bestowal of such a discretion can
be controlled by the court on the ground of “excessive delegation.”87
(C) Procedure Established by Law under Article 21 and 22 of the
Constitution and Administrative Discretion
Article 21 says, "No person shall be deprived of his life or
personal liberty except according to procedure established by law”.
According to the Supreme Court ruling in Maneka Gandhi v. Union of
Hamdard Dawakhana v. Union of India, AIR 1960 SC 534; Jalan Trading Co. v.
Mill Mazdoor Sa'bha, AIR 1967 SC 691.
India,88 Article 21 envisages “reasonable, fair and just procedure”.
Strange though it may seem, the Indian constitution visualizes the
possibility of a law of preventive detection as a peace time measure.
Preventive detention here means detention of a person by an
executive authority merely on suspicion without any trial and
conviction by a court of law.
Clause (1) to (7) of article 22 provide some protection to the
individual in preventive detention to contain a few procedural
safeguards mentioned therein. It is judicially established that the
making of an order of preventive detention can be left entirely to the
subjective satisfaction of the executive without the legislature setting
up an objective standard or test for the purpose.89 A law of
preventive detention cannot be faulted on this ground so long as it
provides safeguards laid down in Article 22(4) and (5). The control
of judiciary on preventive detention is only marginal. Courts are
confined to reviewing an order of detention like any other
discretionary order on such grounds as mala-fides irrelevant or
extremeous considerations, non-application of mind by the detaining .
authority. The courts can also scrutinise the order to see whether
the authority has complied with the prescribed procedure90 or kept
himself strictly within the confines of the law.91 They can also
examine the grounds from the point of view of their adequacy to
make a representation” whether the grounds are vague or indefinite
so as to make it difficult for the detenue to make' adequate
representation,92 or whether the particular furnished to him are
AIR 1978 SC 597.
A. K. Gopalan v. State of Madras, AIR 1950 SC 27;
Makhan Singh v. State of Punjab, AIR 1952 SC 27.
Pankaj Kumar v. State of W.B., AIR 1970 SC 97.
Dhananjay v. Distt. Megisatrate, AIR 1982 SC 1315.
sufficient to enable him to do so93 and further, whether more than
reasonable time taken in furnishing the grounds to the detenue.94
Thus, Article 22 permits the bestowal of a large amount of
f.
discretion on the administration to order preventive detention. But it
is also now judicially accepted that a law of preventive detention
must not only fall within Article 22 but must also fulfil the
requirements of Article 21, 19 and 14.95
In A.K. Roy v. Union of India,96 it was contended that various
phrases which occur in Section 3(1) and (2) of the National Security
Act, such as prejudice to the defence of India, ‘security of the state’,
'maintenance of public order’ or ‘maintenance of supplies and
service essential to the community’ are so vague, general and
elastic that even conduct which is otherwise lawful can be
comprehended therein depending upon the whim and caprice of the
detaining authority. Though the Supreme Court accepted the
proposition that” the vagueness and the consequent uncertainty of a
law of preventive detention bears upon the reasonableness of that
law “for a person “cannot be deprived of his liberty by a law which is
nebulous and uncertain", yet the court refused to hold the Act invalid
i on that ground. The various expressions used in the Act relate to
concepts “which are difficult to encase within the strait jacket of a
definition”. These concepts are not capable of a precise definition
but they “do not elude a just application to practical situations” and
the courts must strive to give to these concepts a “narrower
construction” than what the literal words suggest. The act must be
restricted in its application to as few situations as possible and it is
on this unstated premise that the constitutionality of sec. 3 may be
Ujagar Singh v. State of Punjab., AIR 1952 SC 350.
Hardhan Saha v. West Bengal, AIR 1974 SC 2154.
AIR 1982 SC 710.

upheld, Otherwise, a law of preventive detention, if construed

liberally, is fraught with grave consequences to personal liberty.
However, the expression concerning “maintenance of
supplies” was found to be vague in so far” as it was not made clear
as to which supplies or services were regarded essential to the
community. In the absence of a definition of “supplies and services
essential to community” the detaining authority can extend the
application of this clause to any commodities or services which it
regards essential to the community. The court thus ruled that no
person would be detained under the clause unless “by a law, order
or notification made or published fairly in advance, the supplies and
services, the maintenance of which is regarded as essential to the
community, and is respect of which the order of detention is
proposed to be passed are made known appropriately, to the
public”.97
The court also did not accept the challenge saying that the law
contains certain safeguard subject to which the officers could
exercise the said power, hence the power conferred on district
Magistrate or commissioner of police to pass orders of preventive
detention could not be excessive or unreasonable in view of in built
safeguards.
Thus, article 22 deals with aspect of protection against arrest
and detention in certain cases. It prescribes the minimum procedure
that must be included in any law permitting preventive detention and
if such requirements are not observed the detention infringes the
fundamental right of the detenue guaranteed under Article 21 and
22.98 Article 22 lays down the procedure to be followed in cases of
preventive detention and the said procedure must be strictly
97
98
Ibid.
Abdul Karim v. State of W.B., AIR 1969 SC 1028.
observed as the only prospect of release by a court must be on the
basis of technical or formal defects, a long line of decisions having
held that the scope of judicial review in matters of preventive
detention is practically limited to an enquiry as to whether there has
been strict compliance with the requirements of the law."
Article 22(1) embodies a rule which has always been regarded
as vital and fundamental for safeguarding personal liberty in all legal
system where the rule of law prevails.100 The protection under this
article is not restricted to cases of arrest made by executive or other
non-judicial authorities.101 In case of preventive detention an action
must satisfy the requirements of both Article 19 and 22.102
Preventive detention is hard law and must be applied with
circumspection rationally, reasonably and on relevant materials.103
While passing ah order of detention it is the duty of detaining
authority to strictly comply with the provisions of the constitution.104
Where the documents concerned are referred to relied upon or
taken into consideration by the detaining authority they have to be
supplied to the detenue as part of the grounds so as to enable the
detenue to make an effective representation immediately on
receiving the grounds of detention and if it is not done the detention
would be void.105 The Government should consider the
representation made by the detenue as expeditiously as possible
and such consideration must be independent of any opinion which
may be expressed by the Advisory Board.106
Niranjan Singh v. State of W.B., AIR 1952 SC 106; Makhan Singh v. State of
Punjab, AIR 1952 SC 27.
AIR 1969 Se 1014.
State of M.P. v. Shobharam (Per Hidayatullah J) AIR 1966 SC 1910.
Mohd. Yousuf Rather v. State of J & K., AIR 1979 SC 1925 at 1930.
Raj Kumar Siggh v. State of Bihar, AIR 1986 SC 2173.
State of Punjab v. Jagdev Singh, AIR 1984 SC 444.
Kurit Kumar v; Union of India, AIR 1981 SC-1621.
Khairul Hague v. State of W.B., (1969) 2 SCWR 529.
118
The detaining authority must before passing the order of
detention necessarily have sufficient reasons which are of subjective
satisfaction to him and apply his mind on the facets of the
allegations and pass the order of detention.107 The procedural
provisions specified in Article 22 are mandatory.108
Thus, Article 22 permits the bestowal of a large amount of
discretion on the administrative authority to order preventive
detention and the control of judiciary is marginal. It can review an
order of detention like any other discretionary orders in practical
manner. However preventive detention law must fall within Article
22 and also completes requirement of Article 21, 19 and 14.
(iv) Unregulated Discretion
An American administrative law, the prevalent trend is towards
structuring discretion by formulating standards, policies and rules.
By contrast in English law the approach is for the administrative
bodies to judge each case on its merits. While it is permissible to
adopt a policy it is not permissible to act under a rule to dictate the
outcome of a discretion. As regards the Indian law a series of
proposition may be set out. First, generally speaking the Indian
courts will demand that in exercising discretion, particularly
subjective discretion the executive must address itself to the merits
of the case. Thus, in Barium Chemicals Ltd. v. Rana109 the Supreme
Court construed the words 'necessary or expedient’ appearing in
Section 19(2) of the Foreign Exchange Regulation Act, 1947 to
mean that ‘the authority concerned has thought over the matter
deliberately and with care and it has been necessary as a result of
Smt. Manjula v. Chief Secretary to Govt. ofA.P., 1998(1) ALT 170.
S. K. Abdul Karim v. State of W.B., AIR 1969 SC 1028, at 1032.
AIR 1972 SC 591.
such thinking to issue the impugned order’. Similarly, in Shalini Soni
v. Union of India,110; the Supreme Court stated.
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 the mind to pertinent
and proximate matters only eschewing the
irrelevant and the remote.”
Consequently, in preventive detention cases the detaining
authority must exercise its judgement and decide whether detention
was necessary. He cannot mechanically sign the detention,
order.111 In Ajantha Transport v. T.V.K. Transport,112 the Supreme
Court stated in general terms the proposition that the authority
should not act mechanically in exercising their discretion. For the
same reason, they should not receive dictation from another body.
Thus a Public Prosecutor in deciding whether to commence
prosecution or to discontinue criminal proceedings cannot be
compelled to act by instructions from the governments.113 The same
goes for the detaining authority deciding on preventive detention.114
Secondly, an administrative authority is entitled to adopt a
policy providing that it is prepared to consider individual cases on
their merits. The leading case on this point is Shri Rama Sugar
Industries Ltd. v. State of A.P.115 In that case the appellant applied
for exemption from tax payable under section 21(3) of the A.P.
Sugarcane (Regulation of Supply and Purchase) Act, 1961. Section
21(3) empowered the government to exempt from paying tax “any
new factory” for a period of three years or “any factory Which in the

AIR 1981 SC 431.

Empror v. Sibanath Banerjee. AIR 1943 FC 73; Teka Bahadur v. State of W.B.
AIR 1975 SC-1000
Balwant Singh v. State of Bihar, AIR 1977 SC 2265.
Vijay Kumar v. State of J & K., (1982)2 SCC 43.
(1974)1 SCC 534.
opinion of the government” had “substantially expanded... for a
period not exceeding 2 years”. The government granted exemption
only to factories run by the co-operative societies. The appellant
argued that the government should have considered the application
of each factory on its merits and that the government had fettered its
discretion by adopting a policy of granting such exemption only to
factories run by co-operative societies. The court upheld the policy
of granting the exemption to co-operative sugar societies.
This ruling indicates that while it is lawful to adopt a policy it is
not permissible to adopt a rule that precludes consideration of each
individual application on its merits.
Thirdly, wide discretionary powers, unstructured and
unregulated by ‘principles’, 'standards’ or 'guidelines’, are likely to be
declared unconstitutional being inconsistent with a number of
constitutional provisions in particular Article 14 and 19. Legislatures
while enacting legislation are expected to structure discretion by
formulation of standards. Thus, in Bachan Singh v. State of
Punjab116, legislation providing for death penalty without any
guidelines as regards the sentencing policies was condemned as
unreasonable and arbitrary as being contrary to Article 14 and 21 of
the constitution. In this respect Indian law has moved closer to
American law rather than English law. This is due to the proximity of
the "equal protection clause” of the Indian constitution to the
Fourteenth Amendment of the U.S. Constitution. The position
reached in the Indian Law echoes the words of the American court in
Gulf Colorado Co. v. Ellis117 where it said :
“To carry the presumption to the extent of
holding that there must be some undisclosed
and unknown reason for subjecting certain
AIR 1982 SC 1325.
(1897)165 US 150.
individuals or corporations to hostile
discrimination, legislation is to make the
protection a mere rope of sand.”
The Indian Supreme Court expressed a similar sentiment
when it rejected the claim of the ‘absolute’ right to nominate 5 per
cent of candidates for state financed medical college by a state
Government. The court observed that such a power must be
exercised in accordance with criteria laid down in advance.118
D. REVIEW
There is a tendency at present in all democratic countries to
leave a large amount of discretion in the hands of administrative
authorities. Thus, today the question of control of discretionary
powers is perhaps the most crucial and critical problem of the
modern administrative law. In India, courts have to play a major role
in controlling the discretionary powers. They control discretion at
two levels viz, at the level of delegation of discretionary power; and
at the level of actual exercise of discretionary powers.
At the stage of bestowal of discretionary powers by legislature
to the administrative authorities, the judiciary, is quite a large number
of situations, has rejected legislative attempts to confer unregulated
and unguided discretion in area covered by some of the
Fundamental Rights, such as Article 14 and 19 (and now Article 21)
and that it has insisted that the legislature should set up a standard
or lay down a policy or principle, subject to which administrative
discretion may be exercised. The efficacy of this approach, has,
however, been somewhat mitigated and diluted by the judiciary
accepting at times vague and general statements of policy in the
statute as adequate for holding the discretion conferred in
administrative authorities as not “unregulated". The Standard
Suman Gupta v. State of J & K., AIR 1983 SC 1235,
accepted as sufficient for this purpose has been so general and
vague that it is doubtful whether it serves any useful purpose by way
of controlling administrative discretion. Further, quite often the so
called standard is stated not in the substantive clause which confers
discretion on the authority but in the preamble to the statute and so
a doubt remains whether the judiciary can ever enforce such a
?v
standard to control executive action. It is submitted that an
advantage of having a statement of a standard or policy in the
relevant statute is to enable the judiciary to ascertain whether the
administrative action is in conformity with the standard. This
purpose can be effectively achieved only if the courts insist that the
legislature expresses its policy or standard or principle clearly, and in
such a way as would help the judiciary to keep the exercise of
discretion within the four corners of the legislative policy.
Further there is no uniformity yet on what procedural
safeguards ought to be there in legislation under different
Fundamental Rights. In the case of some like freedom of “trade"
and “speech” and “association”, the judiciary has insisted on more
substantial safeguards than in the case of other fundamental rights,
like those of “movement” or “residence’, though even amongst the
former category there is a lack of consistency in the judicial attitude.
Thus, between “freedom of speech” and "freedom of association”,
the latter is a better protected right. In the case of “association," the
courts have shown a disinclination to leave matters finally in
executive hands without judicial control. The weakest link in the
chain is the right of movement where the judiciary has not found it
possible or necessary to insist on even such a. weak safeguard as
that of an advisory board for externment of a person from a local
area. If the judiciary has found it necessary to insist on more than
an advisory board in the case of the right of association, there does
not appear to be any convincing reason why at least an advisory
board be not required in cases of externment. Thus, it appears, is a
minimum safeguard which the judiciary should impose under the
term “reasonable” in the relevant Fundamental Right.
The minimum safeguards in cases of grant and cancellation of
licences have not yet been clearly established. What can be said
definitely in this connection is that absolute discretion cannot be
conferred on an administrative authority and that a safeguard that
the authority should record its reasons for taking action is not
sufficient by itself, and that something more than that is necessary.
As regards cancellation of a licence, the courts now invariably insist
on a fair hearing as a procedural safeguard.
From the foregoing discussion, it also reveals that except now
and than, the court has been easily satisfied by broad or even vague
statements of policy in upholding legislation under Article 14. It has
shown a great deal of deference to legislation conferring discretion
on the administration. Article 14 constitutes a great potential
reservoir of judicial power and can serve as a great bulwark against
excessive executive discretion. If courts handle Article 14 carefully
and insist on a more definite, and precise statement of policy, the
courts could effectively control the administration.
It may not be out of place to mention here that in the
Fundamental Rights there is a source of judicial power which, if fully
exploited, can go a long way in mitigating the dangers of too much
administrative discretion-a development which is causing a good
deai of anxiety to thinking people in other democratic countries.
These rights are real and not notional, they are substantial and not
fictional, and they should be treated as such. Fortunately, the Indian
Constitution has within itself several checks and balances and it
depends upon us how we use them. It will lead to better democratic
ideals and traditions if we exploit fully the expedients which the
constitution has placed at our disposal for controlling administrative
action and keeping it within proper bounds. In a welfare state, a
balance has to be drawn between government control and individual
freedom, and it is for the courts to see that this balance is not titled
too much in favour of the government as against the individual.
 Unit-V

Administrative Tribunals

5.1. Need of Administrative Justice

5.2 Adoption of Droit Administratif, Franks Committee
5.3 Distinction between administrative tribunal, court and administrative
authority.
5.4 Tribunals in India-Classification.
5.5 Tribunals under Indian Constitution, Central Administrative Tribunal
5.6 Inquiry Commissions

1
INTRODUCTION
Administrative justice is part and parcel of the common,
though frequently unarticulated understandings and
expectations inherent in the constitutional fabric woven from
the weft and warp of our political and legal systems. Put quite
simply, it is a fundamental principle that the government- at all
the levels and in all its manifestations-should act justly in its
dealings with the public. Not only are the means to attain
administrative justice problematic, but the concept of justice
itself is the ambiguous and often contested.1 In this background
the introductory part seeks to provide a contextual overview of
the current provision of administrative justice in India.
The road to administrative justice is a challenging one,
the challenge being how to ensure, in the modern and complex
society that the actions and decisions of our public bodies
and institutions are just? How can administrative justice be
achieved? Through what mechanisms? What is required to a
system able to deal justly with the heard policy choices that
inevitably have to be made in the selection of priorities, the
allocation of resources and the availability of public services?
Consequently whether from a conceptual, procedural or
substantive perspective, administrative justice presents one
of the most central and vexed issues in the field of public law.2
Traditional democratic processes for delivering
administrative justice fall short of meeting demands for
machinery that can respond effectively to the complexity of
modern government. The traditional mechanism of seeking
justice through courts has been widely supplemented in the
1 ADMINISTRATIVE JUSTICE-Central Issues in UK and European Administrative
law,Diane
Longley and Roda James-Cavendish, p. 3.
2 Ibid.
2
past years by the recognition and functioning of new
mechanisms like the Tribunals, Inquiries, Commissions,
Regulatory authorities etc. The evolution of these methods ate
aimed to overcome the crises of accountability and legitimacy
in the administrative functioning which the conventional courts
failed to meet.
Although this book is about the administrative justice
system in India special emphases has been given to the
Administrative Tribunals only as these are considered as the
most established and successful contributors of the
administrative justice.
In Indian perspective the courts acted as the guardian of
the rights and interests of people. They also are involved in
providing adequate remedies for the administrative wrongs
and have also proved to be the authorities which established
the fundamental principles of administrative law along with the
equity jurisprudence. The courts have the constitutional
obligation for maintaining the rule of law in the society. But
because of the overburden, complicated procedures, time
consuming methods and all the other reasons discussed later,
the courts alone as the traditional institutions for securing the
administrative justice have proved inadequate. It was natural
to expect new alternatives or innovative ways and to make the
alternative arrangements to look at the emergent needs in the
areas of more effective scrutiny of administrative process.
Inspiration from the global developments had been taken
and as a result a lot of experimentation was done. This resulted
in establishing of new mechanisms. These systems are known
as Tribunals Inquiries, Commissions etc. Before coming to the
details about administrative justice through Tribunals it
necessary to first consider the several other ways which have
developed or have been developing as systems to meet
expectations of administrative justice in India.
3

TRIBUNALS
Administrative tribunals are quasi-judicial organizations,
located outside of the judicial branch. They play a central role
in the administration of government policies. It is difficult to
make generalizations about administrative tribunals because
their forms and functions are so variable. However, tribunals
typically resemble courts in form and, in function; they decide
how to apply government policies to particular cases. Perhaps
25
the most familiar areas in which administrative tribunals
operate are in service matters, environment and social security
policy, but tribunals are in fact quite common features of
bureaucracies.
Tribunals are known as a seat or court of justice. Meaning
of tribunals denotes the bench on which a judge or other
presiding officer sits in court. Tribunals are also referred a
committee or board appointed to adjudicate in a particular
matter.
According to Curzon, Tribunals have been defined as
“Bodies outside the hierarchy of the courts with administrative
or judicial functions”16
Administrative tribunals resolve disputes between, for
example, the citizen and an officer of a government agency or
between individuals in an area of law in which the government
has legislated the conduct of their relations.
H.W.R.Wade and Phillips once opined that ‘A prominent
feature of the governmental scene is the multitude of special
tribunals created by Act of Parliament. Each of these is
designated to be part of some scheme of administration, and
collectively they are sometimes called the administrative
tribunals.’17
Schwartz and Wade have written in their book; legal
Control of Government. ‘The welfare state could not function
without an elaborate judicial system of its own. Claims for
benefit, application for licenses, disputes about controlled rents,
planning appeals, compulsory purchase of land- there are host
of matters which have to be adjudicated upon from day to day
and which are, for the most part unsuitable for the regular
courts. In the background are the courts of law with supervisory
16 Curzon, Dictionary of Law, 1994, p387.
17 Page 904
26
and often, also, appellate functions. But the front line judicial
authorities for the administrative purposes are bodies created
ad hoc.’
It is generally understood that for creation of new standards
in such diverse matters such as housing, social services, town
and country planning, capacity for work, control of transport,
professional and Trade discipline, and the like, greater
technical experience, greater flexibility and a greater emphasis
on social welfare are required than the ordinary judicial process
and tradition allow.18
Tribunals are the outcome of this requirement which has
ever been a very effective tool for administrative justice today.
18 Principles of Australian Administrative law by Benjafield, D.G. and Whitemore, H., p.
332 (4ht Edn.)
27
DIFFERENCE BETWEEN ADMINISTRATIVE
TRIBUNALS AND THE REGULAR
COURTS
Just as any regular court the administrative tribunals also
hear both parties to the dispute, examine the evidence, and
pronounce decisions. However, administrative tribunals or
courts are not considered to be part of the ‘judiciary.’
Administrative tribunals decides different kinds of
disputes depending upon the law which constitute them, the
different range of disputes covers:-
• disputes between a private citizen and a central /State
government departments, such as claims to social security
benefits; failure of natural justice.
• disputes which require the application of specialized
knowledge or expertise, such as the assessment of
compensation following the compulsory purchase of land;
and
• other disputes which by their nature or quantity are
considered unsuitable for the ordinary courts, such as fixing
a fair rent for premises or immigration appeals.
Special features of tribunals in comparison to courts :
Encouraging Applicants: SPEED, ECONOMY,
FORMALITY, and REPRESENTATION;
FLEXIBILITY OF APPROACH
INQUISITORIAL RATHER THAN ADVERSARIAL
APPROACH.
SPECIALIZED JURISDICTIONS.
The main reasons for the creation of administrative
tribunals may be identified as:
28
• Burden on Judiciary-the relief of congestion in the ordinary
courts of law (the courts could not cope with the caseload
that is now borne by social security tribunals,
employment tribunals and the like);
• Delay-the provision of a speedier and cheaper procedure
than that afforded by the ordinary courts (tribunals avoid
the formality of the ordinary courts); and
• Need for Expertise:-the desire to have specific issues dealt
with by persons with an intimate knowledge and
experience of the problems involved (which a court with a
wide general jurisdiction might not acquire).
A slight difference in the approach of administrative
tribunals is that they do not follow the principles of law and
evidence but they follow the principles of natural justice. Further,
administrative courts in India are manned by officers from the
executive organ of the government, and not from the judiciary.
Other notable points that make administrative courts
different from regular courts are as follows:
• It is not compulsory to have a lawyer to represent your
case, if there is scope for adjustment on the dispute.
• The decision can be determined by experts on a subject
and they don’t have to be judges.
• Formal rules pertaining to evidence and witnesses are
not necessary.
• There are no complex court procedures.
• Administrative courts are not bound by precedents as they
can formulate policy and exercise considerable flexibility
to improve standards and procedures.
29
DIFFERENCE BETWEEN
TRIBUNALS AND INQUIRIES
Tribunals and inquiries somewhat have different functions
within the administrative process. Tribunals are mainly
adjudicative and act as court substitutes by hearing appeals
against decisions. Tribunals generally have an important role
in finding facts and applying legal rules derived from statutes
and regulations. However unlike the ordinary courts the doctrine
of binding precedents does not apply to them.
On the other hand inquiries are the part of original decision
making process, they are frequently activated only after an
appeal has been lodged against the initial government
decision. There is different kind of inquiries under
administrative law. For example planning inquiry, it results in
the recommendations to the particular departmental head,
which may well have wider policy considerations to take into
account before arriving at final decision.
Tribunal is a permanent body which sits periodically.
An inquiry is established on ad hoc basis.
Inquiries are set up in response of a particular event. They
may sit for months and years but they are not permanent
bodies.
Tribunals are empowered to make decisions which are
binding on the bodies subject to their jurisdiction.
Inquiries generally do not have formal decision-making
power. Inquiry ends with publication of report containing its
recommendations. It will generally be the matter of the authority
which ordered for the inquiry to act or not to act on these
recommendations.
Tribunals are concerned with matters of fact and law,
whereas inquiries are concerned with wider policy issues.
30
DEVELOPMENT
FRANCE
When we have to look into the historical development of
tribunals it is best to begin with the development of tribunals in
France, from where the concept of administrative courts has
originated.
In academic terms, French law can be divided into two
main categories: private or judicial law (“droit privé”) and public
law (“droit public”).
There are two spheres of judicial law includes, these are,
civil law (“droit civil”); and criminal law (“droit pénal”).
Public law includes, two spheres which includes
administrative law (“droit administratif”); and constitutional law
(“droit constitutionnel”).
Taken together, these four areas of law (civil, criminal,
administrative and constitutional) constitute the major part of
French law.
This is appropriate to say that the French judicial system
is divided in two parallel hierarchies of courts, the courts of the
judiciary and the administrative courts. The reason for this
double hierarchy lies in the French interpretation of the
separation of powers. It was thought that if the regular courts
had to decide on cases to which the administration was a party,
this would give the judiciary a means of intervening in the
administrative process, which would violate the principle of
the separation of powers. This is also the most striking
distinction between the common law and civil law legal systems
on the continent, of which the French is a prime example
(having the Conseil d’Etat, and a system of tribuneaux
administratifs) is the absence within the common law systems
31
of any separate court applying a universally applicable body
of concepts and rules, quite distinct from the general law of
the land, regulating justiciable administrative activity.
However this concept of administrative courts was not
accepted easily. New prejudices were added to the old
by Dicey’s critique of the exclusive administrative
jurisdiction vested in the French Conseil d’Etat, which he
stigmatised as being opposed to the fundamental
principles of the rule of law that pervaded the British
Constitution.19 To him the rule of law involved the
proposition that every person, including Ministers and
officials, was subject to the ordinary law of the realm and
amenable to the jurisdiction of the ordinary courts; droit
administratif, on the other hand, implied the exemption of
the Government and its servants from personal legal
responsibility for official acts before the ordinary courts;
instead, they were subject to “official” law applied by
special and more or less official bodies.20 Since the rule
of law was a good thing, what was incompatible with the
rule of law was obviously a bad thing.
19 Introduction to the Study of the Law of the Constitution (10th ed., 1959), pp. 328-405.
20 E.H. Lawson, “Dicey Revisited” (1959) 7 Political Studies 109, 207. Cf. Trowbridge H.
Ford, “Dicey as a Political Journalist” (1970) 18 Political Studies 220. See also M.
Loughlin, Public Law and Political Theory (1992) Chap. 7; P. Craig, Public Law and
Democracy in the United Kingdom and The United States of America (1990), Chap. 2.
32

37
ENGLAND
English lawyers were readily persuaded to regard
administrative law, or droit administratif, as a misfortune
inflicted upon the benighted folk across the Channel. In 1932
the Committee on Ministers’ Powers thought it sufficient to
condemn as “inconsistent with ... the supremacy of the Law” a
proposal to take away the existing supervisory and appellate
jurisdiction of the High Court and to vest it in new and distinct
administrative courts. As recently as 1935 the then Lord Chief
Justice of England could still dismiss the term “administrative
law” as “Continental jargon”.22 In so far as it was being brought
into existence by Parliament (by confiding justiciable issues
to special statutory tribunals and delegating unreviewable
powers to Ministers) it was to be resisted as un-English. A
climate of opinion in which administrative law was treated as
an alien intrusion that was not (or at least ought not to be) part
of the law of England was inimical to objective research into
the problems posed by the developing law of public
administration.23 The inter-war years in particular was largely
dominated by impassioned but often sterile controversies
concerning the constitutional propriety of administrative
tribunals and delegated legislation.
Another ideological rider in the growth of administrative
law was the concept of separation of powers. Every
government has three vital organs to ensure its smooth
functioning, namely:
22 Lord Hewart of Bury, Not Without Prejudice, p. 96.
23 For a critical account of the baleful influence of Dicey’s insistence that the legality of
governmental action was to be determined by the ordinary courts applying the
general law of the land, refer H.W. Arthurs, “Rethinking Administrative Law: a Slightly
Dicey Business” (1979) 170 O.H.L.J. 1 and Without the Law: Administrative Justice
and Legal Pluralism in Nineteenth Century England (1985); and M. Loughlin, “Courts
and Governance”, Chap. 9 in P. Birks (ed.), The Frontiers of Liability vol. 1 (1994).
38
• The legislature
• The executive
• The judiciary
This structure is based on the understanding that just as
the human body depends on the smooth functioning of its vital
organs to stay fit and healthy, every government requires these
three vital organs (listed above) to work perfectly. We know
that the legislature enacts laws to regulate activities in the
society while the executive implements these so as to maintain
the law and order in the state. The relevance of the judiciary is
that when there are any crimes that are committed or if there
are any disputes about rights, duties, responsibilities or a
question of law that arises, the judiciary interprets the law and
delivers a judgment to settle the dispute.
The separation of powers embodies an ideological
philosophy, that of balancing power between different bodies
so that no power centre can act without the co-operation of the
others, and each checks the others – the checks and balances
doctrine. No legal machinery can deal with the extreme case
of overwhelming political power, and however much we may
split up our governments, the separate parts could be taken
over by a like-minded tyrannical group. Nevertheless, the
separation of powers is intended to make this possibility
unlikely.
A theory of separation of powers has been recognized
since at least the time of Aristotle. There are several different
meanings of the separation of powers (Marshall, 1971). For
example, the classical doctrine favoured by Aristotle would
divide power according to class interests, these comprising
monarchy, aristocracy and democracy. This version of the
separation of powers is partly reflected in the British institutions
39
of monarch, House of Lords and House of Commons, and was
a powerful influence upon the 1688 Revolution. However, the
most influential version of the separation of powers is that
proposed by Montesquiue (De L’Esprit de Lois, 1748).
According to Montesquiue, government powers can be
divided into three kinds: (i) the legislative power of enacting
general laws; (ii) the executive power concerned with policy
making, foreign affairs and enforcement; (iii) the judicial power
concerned with the settlement of disputes about the law. If any
two of these three fall into the same hands there is a risk of
tyranny. Moreover, no branch must trespass on the territory of
another branch and each can check the powers of the others,
for example, the legislative can dismiss the executive. In its
pure form, the reparation of powers leads to weak and
cumbersome government. In practice a pragmatic
compromise is usually adopted.
In England the early Stuarts had endeavoured to withdraw
matters of State from the courts of common law,24 and had
enforced their will primarily through the medium of their
prerogative courts, in which substantive and procedural rules
unknown to the common law were applied. The common
lawyers joined in alliance with the parliamentarians to bring
about the downfall of the Court of Star Chamber and other
prerogative courts in 1641, and their alliance was renewed in
1655 to thwart the arbitrary pretensions of James II. The
traditions handed down from the constitutional struggles of the
seventeenth century created an all but invincible prejudice
against encroachments upon the province annexed by the
common-law courts in the field of public laws. Public law and
private law were in the future to be undivided and indivisible.
These traditions were reinforced by the exceptional degree of
24 In particular by the writ de non procedendo rege inconsulto.
40
public esteem earned by the superior judges after the Act of
Settlement 1701 had ensured their independence of the
Executive, and they led naturally to a general tendency to
exaggerate the practical efficacy of the functions exercised by
the ordinary courts in controlling the activities of government
bodies and office holders.25
The landmark events facilitating the growth of
administrative tribunals in England:-
1. The Crichel Down affair-a political scam of 1954.
2. A committee of inquiry appointed by lord Chancellor, was
chaired by Sir Oliver Franks- Frank’s Report.1957-study
of administrative tribunals and such public inquiries.
3. Recommendations of the Franks committee were largely
accepted and resulted in the Tribunals and Enquiries Act
of 1958.
4. Basic assumptions of Franks report:-
• Tribunals are an adjudicating rather than an
administrative body.
• They should be fair, open and impartial.-publicity of
proceedings, reasoned decision.
• Impartiality
Lowering down of the standards of public administration
and particularly rampant corruption paved way for some
important developments in the English administrative field.
In the year 1954, The Crichel Down affair happened in
England, this was was a British political scandal, with a
disproportionate subsequent effect and notoriety. The
resignation of the government minister Sir Thomas
25 Echoed even today in the argument that it is unnecessary and indeed undesirable, to
have a specialised Administrative Division of the High Court because the Crown
Office and the nominated judges of the Queen’s Bench Division do the job so
excellently.
41
Dugdale has been taken as setting a precedent on
ministerial responsibility, even though the doctrine
supposed to arise from the affair is only partially supported
by the details. Lord Carrington, Dugdale’s junior minister,
offered his resignation but was told to stay on.
The case is related to 725 acres (2.93 km2) of agricultural
land at Crichel Down, near Long Crichel, owned by a
Commander Marten and purchased in 1938 by the Air Ministry.
This was given for bombing practice for the Royal Air Force.
The purchase price when it was requisitioned was £12,006. In
1941 Winston Churchill gave a promise in Parliament that the
land would be returned to its owners, after World War II. This
promise was not honoured. Instead the land (then valued at
£21,000) was handed over to the Ministry of Agriculture who
vastly increased the cost of the land beyond the amount the
original owners could afford (£32,000), and leased it out.
In the year 1949 the original owners began a campaign
for a return sale of the land, and gained an inquiry.
The inquiry was chaired by Sir Oliver Shewell Franks.
Baron Franks, was an English public servant and philosopher
. In 1957 the Franks Committee was appointed by the British
lord chancellor to study administrative tribunals and such
procedures as the holding of a public inquiry. The committee
declared that the work of administrative tribunals and of public
inquiries should be characterized by openness, fairness, and
impartiality, and their report applied these aims in great detail.
The recommendations of the committee were largely accepted
and resulted in the Tribunals and Enquiries Act of 1958.
Basic assumptions of the report could be divided into three
segments:-
Tribunals are an adjudicating, rather than administrative,
body and they should be fair, open and impartial.
42
Openness is for publicity of proceedings and the reasoning
behind the decision.
Fairness of a clear procedure, present the case fully and
knowledge of requirements to meet for parties. Impartiality
established from independence from real or apparent influence
of administration.
Citizen should have prior knowledge of right to apply,
public knowledge of the proceedings unless the content is of
sensitive nature, legal representation normally allowed.
Tribunals empowered to take evidence under oath
subpoena witness and award remedy. Decisions with full
reasoning and copy sent to all parties. Final appellate tribunal
to publish its decision for lower tribunals.
Appeal from first instance to an appellate tribunal, but
never to a minister, unless First Instance tribunal is highly
competent. Common law remedies of Certiorari (direction to
send records), mandamus (mandatory order) and writ of
prohibition (abstain a court where it lacks competance) should
never be restricted. Also the report recommended the Councils
of Tribunals to be formed to perform their respective role as
envisaged in report.
Tribunal procedures
The report of Franks committee had far reaching
consequences as it affected and influenced the administrative
scene in all the common law jurisdictions including India.
Since tribunals are established to provide a form of
redress, mostly in disputes between citizen and State, the
principal hallmark of any tribunal is that it must be independent,
and perceived as such.
The tribunal should be able to reach decisions according
to law without pressure either from the body or person whose
43
decision is being appealed, from any party to a dispute or
from anyone else.
Judicial decisions should be uninfluenced by other external
considerations.
Procedures should be open to scrutiny if they are to retain
public confidence; they should provide a fair hearing at which
citizens can state their case and be informed of all the evidence;
tribunals should reach their decisions demonstrably free from
all personal interest and bias.
Tribunal hearings should be open and fair, which must be
available to all sections of the community in our society.
Tribunals should be independent and provide open, fair
and impartial hearings
Tribunals should be free to reach decisions according to
law without influence (actual or perceived) from the body or
person whose decision is being challenged or appealed, or
from anyone else.
Judicial officers should be independent
Procedures of selection and appointment of Tribunal
members should be fair and independent of related
departments of government and other interested parties.
Procedures should ensure conflicts of interest are
identified and avoided and
Hearings should normally take place in public, although a
private hearing should be provided in appropriate
circumstances.
At the hearing, the identity of tribunal members to be
communicated to the parties.
Hearings should be conducted with an appropriate degree
of informality, and the necessary steps taken to ensure all
relevant issues are explored.
44
Appropriate guidance about evidence and procedures
should be given at hearings especially where individuals have
no legal representation.
Special procedures should be provided for hearings involving
vulnerable groups.
The parties should be accorded equal status.
If the hearing proceeds in the absence of a party, or his
representative, the tribunal should nevertheless seek to ensure
that that party’s case is fully considered.
Decisions should be soundly based on the evidence and
relevant law;
They must be supported by reasons, explained clearly to
the parties, and if given orally confirmed in writing.
Reasons should identify findings of fact, apply relevant law
and explain the decision.
Tribunals should be accessible to users and focus on the
needs of users.
Potential users of the tribunal should be given access to
information about its services, and where previous decisions
of the tribunal are recorded.
Makers of decisions from which there is a right of appeal
to a tribunal, should be obliged to inform those affected by
decisions of the right of appeal, and how a guide to such rights
and procedures can be obtained.
Papers required by tribunals to be proportionate, and
appropriate to issues at stake.
SPECIAL ATTRIBUTES OF TRIBUNAL JUSTICE :
ACCESSIBILITY
IMPARTIALITY
OPENNESS
45
TRANSPARENCY
PROCEDURAL FAIRNESS-HEARING
PROPORTIONALITY
REASONED DECISIONS
Users should be able to understand: what papers they
have to provide; what papers the other party will provide; what
additional papers the other party can be required to provide.
Provision should be made for users with special needs,
e.g. audio tape.
There should be a clear time limit for lodging of all papers.
Tribunals to provide clear information about how their case
will be handled.
Users should be clearly informed about what is expected
of them, what they have to provide, what will happen at a
hearing, and the circumstances in which how to make a claim.
Users should be able to find out about the progress of
their case, and how long they are likely to have to wait for a
hearing or decision.
The tribunal’s decision should be accompanied by
information about appeal rights.
A complaints policy and procedure; should be in place in
relation to the performance of both judiciary, and administration,
and be publicized to users.
Tribunals should establish and publish a clear policy on
equal treatment, and continuously monitor compliance.
Tribunals should offer cost effective procedures and be
properly resourced and organized.
Judicial resources should be managed to provide a good
service, and to ensure that individuals sit often enough to
maintain knowledge and skills.
46
Standards for judicial behaviour and performance should
be set and monitored.
Outstanding cases should be collected and monitored.
Standards for hearing venues, and for service, and
performance should be set and monitored, in consultation with
users.
Appropriate planning and monitoring procedures should
be in place.
Data about patterns in the caseload (errors in first tier
decision making, cost of cases going to judicial review etc.)
should be collected and monitored.
Administrative processes should be responsive to the
needs of those who wish to use them.
The reference to “judicial office” is intended to include all
tribunal Chairs and members who exercise judicial powers.
All hearings should be in public; except that the press or
public may be excluded from all or part of the hearing in the
interests of morals, public order, national security, or where
the interests of the protection of the private life of the parties
so require, or to the extent strictly necessary in the opinion of
the tribunal in special circumstances where publicity would
prejudice the interests of justice (Article 6, European
Convention on Human Rights).
The Tribunal chairman may ask anyone giving evidence
to give evidence on oath.
Franks committee report resulted in many achievements
as most of the recommendations were implemented by
Tribunals and Inquiries act 1958 and Tribunals &Inquiries Act
1992; others were implemented by administrative practice.
Working and number of Council of tribunal was mentioned
in the schedules, with their function being advisory, but they
47
could make recommendations on any matter and had to be
consulted before any rule was enacted.
Right to give reasons was added, but it had to be asked
before or during the decision and judicial review restricted in
few instances. List of tribunals could be stopped by ministerial
power.
Where report’s recommendations weren’t followed are
appeals to High Court (Session Court in Scotland) only based
on law and procedure to appoint chairman and member is
different from what report proposed.
The UK tribunal system can be seen as beginning with
the coming into force of the National Insurance Act 1911 which
provided for adjudication of disputes by administrative
agencies. During the twentieth century, UK government
ministers acquired more and more power and were vested
with decisions that affected the day to day life of citizens.[[4]
Tribunals had long been criticised. Lord Scarman had seen
them as a danger to the prestige of the judiciary and the
authority of the ordinary law. In 1988 there were calls for an
Administrative Review Council to provide independent scrutiny
on the Australian model but such ideas were rejected.
The tribunal system of the United Kingdom is part of the
national system of administrative justice with tribunals classed
as non-departmental public bodies (NDPBs).Though it has
grown up on an ad hoc basis since the beginning of the
twentieth century, from 2007 reforms were put in place to build
a unified system with recognised judicial authority, routes of
appeal and regulatory supervision.
The system was little altered by the Tribunals and Inquiries
Act 1992.At the start of the twenty first century there were further
calls for reform in the system there. In 2000 the Legatt Review
48
was set up to look into the operation of administrative tribunals.
The Review found that each tribunal had its own processes
and standards and were not accessible to users. It also raised
concerns about the level of independence of tribunals and the
long delays which users faced in having their dispute resolved
by the tribunals.
The Legatt Review recommended that a new independent
tribunal service be set up so that the relevant sponsoring
government departments could no longer be seen as
influencing the individual tribunals and that a composite twotier
tribunal structure should be adopted.
That led to the creation of the Tribunals Service in 2006,
as an executive agency to manage and administer tribunals,
and to the Tribunals, Courts and Enforcement Act 2007.
The Tribunals, Courts and Enforcement Act 2007 created
a new unified structure for tribunals and recognises legally
qualified members of tribunals as members of the judiciary of
the United Kingdom who are guaranteed continued judicial
independence.
49
ADVANTAGES OF ADMINISTRATIVE
TRIBUNALS
The advantages of administrative tribunals are numerous.
You don’t have to worry about paying for court fees, legal
representation or pleadings. None of this is essential in
administrative courts or tribunals. Further, as there are no
complex procedures, there will be speedy justice. This system
also reduces the burden of pending cases in regular courts.
The weight of expert opinion endows the administrative
tribunals with a higher level of professional expertise and
transparency.
The tribunals are preferred because the courts’ functions
under archaic and elaborate procedural laws and highly
technical evidence law. To ensure fair play and avoidance of
judicial error, the procedural laws provide for appeals, revisions
and reviews and allow parties to file innumerable applications
and raise vexatious objections as a result of which the main
matters get pushed to the back ground. All litigation in courts
get inevitably delayed which leads to frustration and
dissatisfaction among litigants. In view of huge pendency, courts
are not able to bestow attention and give priority to cases
arising under special legislations. Therefore, there is a need
to transfer some selected arrears of litigation dealt with by
traditional courts to special tribunals.
Only if continued judicial independence is assured,
Tribunals can discharge judicial functions. In order to make
such independence a reality, it is fundamental that the members
of the Tribunal shall be independent persons, not civil servants.
They should resemble courts and not bureaucratic boards.
Even the dependence of Tribunals on the sponsoring or parent
50
department for infrastructural facilities or personnel may
undermine the independence of the Tribunal.
Disadvantages of Administrative Tribunals :
Administrative tribunals and courts have come under
considerable criticism. It has limited or non-existent right to
appeal. It has separate laws and procedures that circumvent
the celebrated judicial principles followed by regular courts in
the country. Further, the decisions of administrative tribunals/
courts are not documented, preserved or known to the general
public.
The advantage of a tribunal is that it is:
(a) Quick with no long waits for the case to be heard and
it is dealt with speedily;
(b) Cheap, as no fees are charged;
(c) Staffed by experts who specialise in particular areas;
(d) Characterised by an informal atmosphere and
procedure;
(e) Allowed not to follow its own precedents, although
tribunals do have to follow court precedents Insert.
The disadvantages of tribunals are that:
(a) Some have become more formal;
(b) They are not always independent of the Government,
although the Independent Tribunal Service now
recommends possible chairmen to the Lord
Chancellor;
(c) Some tribunals act in private;
(d) They do not always give reasons, although they are
supposed to give reasons.
(e) Legal aid is not generally available, except for the
Lands Tribunal, the Employment Appeal Tribunal and
the Mental Health Review Tribunal;
51
(f) There is no general right of appeal to the courts: it all
depends on the particular statute creating the tribunal.
Present day evaluation of tribunals in England make it
clear that there is a tribunal in England to after almost every
sphere of life. They do a useful job in taking some types of
work away from the courts and dealing with specialised
matters, less valuable claims and matters involving the exercise
of a discretion.26
There are grey areas and problems remain over lack of
standard rights, like the right of appeal, and procedures. In
many instances they make important decisions affecting
people’s livelihoods and quality of life. To compete this
challenge some special kind of training for tribunal members
is necessary.
26 T. Blakemore and B. Greene, Law for Legal Executives, 1996, p.95:
52
Tribunals in India
Meaning of Tribunal?
Working of Tribunals.
Tribunals and Judicial review.
Doctrine of Precedent
Administrative Tribunals, Article 141 and the Doctrine of
Precedent.
Contempt of Administrative tribunals.
Tribunals at work.
53
Meaning of Tribunal?
A tribunal is a generic term for any body acting judicially,
whether or not it is called a tribunal in its title. For example, an
advocate appearing before a Court on whom a single Judge
was sitting could describe that judge as ‘their tribunal’
The term tribunal is more popularly used today to denote
the administrative courts in India which in the new administrative
law regime which embraces a variety of tribunals for providing
specialized justice.
The Constitution does not define the term “tribunal”.
Etymologically ‘tribunal’ means the seat of justice. In Article
136 the word ‘tribunal’ is used in contradistinction to courts.
Article 136:-
Article 136 - Special leave to appeal by the Supreme
Court
1. Not with standing anything in this Chapter, the Supreme
Court may, in its discretion, grant special leave to appeal
from any judgment, decree, determination, sentence or
order in any cause or matter passed or made by any court
or tribunal in the territory of India.
2. Nothing in clause (1) shall apply to any judgment,
determination, sentence or order passed or made by any
court or tribunal constituted by or under any law relating to
the Armed Forces.
Thus under Article 136 Supreme Court can hear appeals
not only from a court but also from other decision making body
which though not a court as such may yet be characterized as
a ‘tribunal’.27
Supreme Court articulated the meaning of the word
tribunals through different case laws.
27 Principles of Administrative Law,M.P. Jain and S.N. Jain , p.667
54
In Union of India V. R. Gandhi,28 the Supreme Court
elaborately discussed the role of Courts, establishment and
functioning of tribunals and the difference between courts and
tribunals.
The term ‘courts’ refers to places where justice is
administered or refers to Judges who exercise judicial
functions. Courts are established by the State for administration
of justice that is for exercise of the judicial power of the state
to maintain and uphold the rights, to punish wrongs and to
adjudicate up on disputes. Courts refer to the Civil Courts,
Criminal Courts and High Courts. Tribunals on the other hand
are special alternative institutional mechanisms, usually
brought into existence by or under a statute to decide disputes
arising with reference to that particular statute, or to determine
controversies arising out of any administrative law. Tribunals
can be either private tribunals such as arbitral tribunals or
Tribunals constituted under the Constitution or Tribunals
authorized by the Constitution or Statutory Tribunals which are
created under a statute.
Some Tribunals are manned exclusively by Judicial
Officers. Example for that type of Tribunals are Rent Tribunals,
Motor Accidents Claims Tribunal, Labor Courts, Industrial
Tribunals etc., Other Statutory Tribunals are having both judicial
and technical members. Example for that type of Tribunals are
Central Administrative Tribunals, Telecom Disputes Settlement
Appellate Tribunal Competition Appellate Tribunals, Consumer
Forum, Cyber Appellate Tribunal etc.,
Durga Shankar Meha v. Raghuraj Singh,29 defined
‘Tribunal’:-
28 (2010) 96 CLA 222 (SC)
29 AIR 1954 SC 520, S.C.
55
“The expression ‘Tribunal’ as used in Article 136 does not
mean the same thing as ‘Court’ but includes, within its ambit,
all adjudicating bodies, provided they are constituted by the
State and are invested with judicial as distinguished from
administrative or executive functions.”
Bharat Bank v. Employees30, the Supreme Court
observed that though tribunals are clad in many of the trappings
of a court and though they exercise quasi-judicial functions,
they are not full-fledged courts. Thus, a tribunal is an
adjudicating body which decides controversies between the
parties and exercises judicial powers as distinguished from
purely administrative functions and thus possess some of the
trappings of a court, but not all.
• In ‘Harinagar Sugar Mills Ltd., V. Shyam Sundar
Jhunjhunwala’ 31 under section 111(3) of the Companies
Act, 1956, while deciding a dispute regarding the
registration of shares, between a company and a person
who has purchased its share, the Central govt. has to act
judicially, and it has been held that it is a tribunal and so
the court can hear an appeal from its decision.
The Supreme Court succinctly explained the difference
between courts and Tribunals - ‘All Tribunals are not courts,
though are courts are Tribunals. The word ‘Courts’ is used to
designate those Tribunals which are set up in an organized
state for the administration of justice. By administration of justice
is meant the exercise of juridical power of the State to maintain
and uphold rights and to punish ‘wrongs’. Whenever there is
an infringement of a right or an injury, the courts are there to
restore the vinculum juris, which is disturbed.’
30 AIR 1950 SC 188
31 (1962) 2 SCR 339
56
When rights are infringed or invaded, the aggrieved party
can go and commence a quarrel before the ordinary civil courts.
These courts which are instrumentalities of Government are
invested with the judicial power of the State and their authority
is derived from the Constitution or some Act of Legislature
constituting them. Their number is ordinarily fixed but they
ordinarily permanent and can try any suit or cause with their
jurisdiction. Their numbers may be increased or decreased,
but they are almost always permanent and go under the
compendious name of ‘Courts of Civil Judicature’. There can
be thus be doubt that the Central Government does not come
within this clause.
With the growth of civilization and the problems of modern
life, a large number of administrative Tribunals have come into
existence. These Tribunals have the authority of law to
pronounce upon valuable rights; they act in a judicial manner
and even on evidence on oath, but they are not part of the
ordinary Courts of Civil Judicature. They share the exercise of
the judicial power of the State, but they are brought into
existence to implement some administrative policy or to
determine controversies arising out of some administrative
law. They are very similar to courts, but are not courts. When
the Constitution speaks of ‘Courts’ in article 136, 227 or 228
or in article 233 to 237 or in the Lists, it contemplates Courts
of Civil Judicature but not Tribunals other than such courts.
By ‘Courts’ is meant Courts of Civil Judicature and by
‘Tribunals’ those bodies of men who are appointed to decide
controversies arising under certain special laws. Among the
powers of the State is included the power to decide such
controversies. This is undoubtedly one of the attributes of the
State, and is aptly called the judicial power of the State. In the
exercise of this power, a clear division is, thus, noticeable.
57
Broadly speaking, certain special matters go before Tribunals,
and the residue goes before the ordinary Courts of Civil
Judicature. Their procedures may differ, but the functions are
not essentially different. What distinguishes them has never
been successfully established.
The term ‘judicial’. This term is capable of two
meanings. In ‘Royal Aquarium & Summer & Winter
Garden Society V. Parkinson’ 32 it was held that the word
‘judicial’ has two meanings. It may refer to the discharge
of duties exercisable by a judge or by justices in court, or
to administrative duties which need not be performed in
court, but in respect of which it is necessary to being to
bear a judicial mind - that is, a mind to determine what is
fair and just in respect of the matters under consideration.
If an officer is required to decide matters before him
‘judicially’ in the second sense does not make him a court
or even a Tribunal, because that only establishes that he
is following a standard of conduct, and is free from bias
or interest. Courts and Tribunals act ‘judicially’ in both
senses, and in the term ‘court’ are included the ordinary
and permanent Tribunals and in the term ‘Tribunal’ are
included all others, which are not so included. In Jaswant
Sugar Mills V. Laxmi Chand ,33 A Conciliation officer
acting under the Industrial Disputes Act,1947, while
granting or refusing permission to Alter terms of
employment of the workmen at the instance of the
employer, was not a tribunal, although he acts under quasijudicial
capacity under the matter. The Supreme Court
observed that in order to be a Tribunal a body or authority
must, besides being under a duty to act judicially, should
be invested with the judicial powers of the State.
32 (1892) 1 QB 432
33 (1963) Supp (1) SCR 242
58
Engineering Mazdor Sabha v.Hind Cycles,34
Arbitrator appointed under section.10-A, IDA, was held
not to be a Tribunal. The Supreme Court refused to hear
appeal from it on the ground that his appointment was
based on an agreement of the parties and not the state,
and that to be a tribunal, the power of adjudication must
be derived from a statute or a statutory rule and not from
an agreement of the parties.
In the case of Indo-China Steam Navigation v Jasjit
Singh,35 The Central Board of Revenue exercising powers
under s. 191 of the Sea Customs Act, 1872, have been held to
be tribunals but not customs officers even though they do
exercise some judicial powers.
The Constitution Bench of Supreme Court in Associated
Cement Co., Ltd., V. P.N. Sharma,36 explained the position of
Tribunals as - ‘The expression ‘court’ denotes a Tribunal
constituted by the State as a part of the ordinary hierarchy of
courts which are invested with State’s inherent judicial powers.
A sovereign State discharges legislative, executive and judicial
functions and can legitimately claim corresponding powers
which are described as legislative, executive and judicial
powers. Under our Constitution, the judicial functions and
powers of the state are primarily conferred on the ordinary
courts which have been constituted under its relevant
provisions. The Constitution recognized a hierarchy of courts
and their adjudication are normally entrusted all disputes
between citizens and citizens as well as the disputes between
the citizens and the State. These Courts can be described
rules of procedure and they deal with questions of fact and law
raised before them by adopting a process which is described
34 AIR 1963 SC 874
35 AIR 1964 SC 1140
36 (1965) 2 SCR 366
59
as judicial process. The powers which these courts exercise
are judicial powers, the functions they discharge are judicial
functions and the decisions they reach and pronounce are
judicial decisions.
In every State there are administrative bodies or authorities
which are required to deal with matters within their jurisdiction
in an administrative manner and their decisions are described
as administrative decisions. In reaching their administrative
decisions, administrative bodies can often to take into
consideration questions of policy. It is not unlikely that even in
this process of reaching administrative divisions, the
administrative bodies or authorities are required to act fairly
and objectively and would in many cases have to follow the
principles of natural justice; but the authority to reach decision
conferred on such administrative bodies is clearly distinct and
separate from the judicial power conferred on courts, and the
decisions pronounced by administrative bodies are similarly
distinct and separate in character from judicial decision
pronounced by courts.
Tribunals which fall under the purview of Article 136(1)
occupy a special position of their own under the scheme of
our Constitution. Special matters and questions are entrusted
to them for their decision and in that sense, they share with the
court one common characteristic; both the courts and the
Tribunals are constituted by the State and are invested with
judicial as distinguished from purely administrative or executive
functions.
In Gujrat Steel Tubes Ltd. V. Its Mazdoor Union,37 Court
has accepted the Arbitrator appointed under s.10-A, IDA as
tribunal. He deriver his power in essence from a state made
37 AIR1980, SC 1896
60
statute. His award derives force from the statute and therefore
he can legitimately be regarded as a part of the infrastructure
of the sovereign’s dispensation of justice.
All Party Hill Leaders’ Conference v. Capt. W.A.
Sangma,38 Election Commission while exercising power
under Art. 324 read with relevant provisions of the Election
Law to adjudicate upon the disputes regarding recognition
of political parties or rival claims to a particular election
symbol is a tribunal for purpose of Art.136.When the
Commission exercises judicial function it has a duty to
act judicially. The court has also clarified that to be a
“tribunal”, it does not mean that the body must exercise
only the states’ judicial power or that it must exclusively
exercise an adjudicatory function. A body may have
multiple functions administrative, legislative or judicial; it
can be regarded as a tribunal in respect of its judicial
functions however fractional the same may be. A body may
be deemed to be tribunal for some purposes and not for
other purposes. It is not necessary that only function of the
authority must be adjudicatory before it can be
characterized as tribunal.
In the case of Income Tax Commissioner , Calcutta v.
B.N. Bhattacharya,39 "Settlement Commission “ established
under the Income Tax Act was a tribunal .The commission has
been given considerable powers and its determinations affect
the right of the parties.
Kihoto Hollohon v Zachillhu,40 All Tribunals are not Courts
though all Courts are Tribunals. The word ‘courts’ is used to
designate those tribunals which are set up in an organized
38 AIR 1977 SC 2155
39 AIR 1979 SC 1724
40 AIR 1993 SC 414
61
State for the administration of justice. By administration of
justice is meant the exercise of judicial power of the State is
to maintain and uphold rights and to punish wrongs. Whenever
there is a lis-an affirmation by one party and denial by anotherand
the dispute necessarily involves a decision on the right
and obligations of the parties to it, and the authority is called
upon to decide it, there is an exercise of judicial power. The
authority is called a tribunal , if it does not have all the trappings
of the court.
In Durga Shankar Mehta V. Raghuraj Singh,41 it was held
that the Courts and Tribunals are both adjudicating bodies and
they deal with and finally determine disputes between parties
which are entrusted to their jurisdiction. The procedure followed
by the courts is regularly prescribed and in discharging their
functions and exercising their powers, the courts have to
conform to that procedure. The procedure which the Tribunals
have to follow may not always be so strictly prescribed, but the
approach adopted by both the courts and the Tribunals is
substantially the same and there is no essential difference
between the functions that they discharge. As in the case of
courts, so in the case of Tribunals, it is the State’s inherent
powers which has been transferred and by virtue of the said
power it is the State’s inherent judicial function which they
discharge.
Thus, the basic test of a tribunal within the meaning of
Art.136 of the Constitution is that,” it is an adjudicating
authority (other than a court) vested with the judicial power
of the State under a statute or a statutory rule.”
Tribunals under the Constitution of India.
Part XIV A comprising Articles 323-A and 323-B was also
inserted in the
41 (1995) 1 SCR 267
62
Constitution of India by the 42nd Constitutional Amendment
Bill, 1976 which came into effect from 3rd January 1977.
A radical change was brought about in the constitutional
law through this amendment. Article 323A empowers
Parliament to provide, by law, for the adjudication or trial by
administrative tribunals of disputes and complaints with
respect to recruitment and conditions of service of persons
appointed to public services and posts in connection with the
affairs of the Union or of any State. The law may provide for
the establishment of an administrative tribunal for the Union
and a separate administrative tribunal for each State or for
two or more States. Under Article 323-B, the appropriate
Legislature is authorized to provide for the adjudication or trial
by tribunals of any disputes, complaints, or offences with
respect to all or any of the matters specified in clause (2) with
respect to which such Legislature has power to make laws.
Clause two included many subjects including, levy, assessment,
collection and enforcement of any tax; foreign exchange, import
and export across customs frontiers; industrial and labour
disputes; etc. The law may take out adjudication of disputes
relating to the matters as provided from the hands of the civil
courts and the High Courts.
Dr Rajeev Dhavan, said something positive about the new
tribunal system, envisaged under Article 323-A. He observed:
“The Forty-second Amendment envisaged a tribunal
structure and limited review powers by the High Courts. In the
long run, this could mean a streamlined system of tribunal
justice under the superintendence of the Supreme Court.
Properly worked out such a system is not a bad one. It would
be both an Indian and a Common law adaptation of the
French system of droit administratif.” 42
42 Rajeev Dhavan, ‘Amending the Amendment : The Constitution (Forty-fifth Amendment)
Bill, 1978’, 20 J.I.L.I. (1978) 249-272 at p. 267.
63
Article 323A {Administrative tribunals}
1. Parliament may, by law, provide for the adjudication or
trial by administrative tribunals of disputes and complaints
with respect to recruitment and conditions of service of
persons appointed to public services and posts in
connection with the affairs of the Union or of any State or
of any local or other authority within the territory of India or
under the control of the Government of India or of any
corporation owned or controlled by the Government.
2. A law made under clause (1) may -
a. provide for the establishment of an administrative
tribunal for the Union and a separate administrative
tribunal for each State or for two or more States;
b. specify the jurisdiction, powers (including the power
to punish for contempt) and authority which may be
exercised by each of the said tribunals;
c. provide for the procedure (including provisions as to
limitation and rules of evidence) to be followed by
the said tribunals;
d. exclude the jurisdiction of all courts, except the
jurisdiction of the Supreme Court under article 136,
with respect to the disputes or complaints referred
to in clause (1);
e. provide for the transfer to each such administrative
tribunal of any cases pending before any court or other
authority immediately before the establishment of
such tribunal as would have been within the
jurisdiction of such tribunal if the causes of action on
which such suits or proceedings are based had
arisen after such establishment;
64
f. repeal or amend any order made by the President
under clause (3) of article 371D;
g. contain such supplemental, incidental and
consequential provisions (including provisions as to
fees) as Parliament may deem necessary for the
effective functioning of, and for the speedy disposal
of cases by, and the enforcement of the orders of,
such tribunals.
3. The provisions of this article shall have effect
notwithstanding anything in any other provision of this
Constitution or in any other law for the time being in force.
Article 323B {Tribunals for other matters}
1. The appropriate Legislature may, by law, provide for the
adjudication or trial by tribunals of any disputes,
complaints, or offences with respect to all or any of the
matters specified in clause (2) with respect to which such
Legislature has power to make laws.
2. The matters referred to in clause (1) are the following,
namely: -
a. levy, assessment, collection and enforcement of any
tax;
b. foreign exchange, import and export across customs
frontiers;
c. industrial and labour disputes;
d. land reforms by way of acquisition by the State of
any estate as defined in article 31A or of any rights
therein or the extinguishment or modification of any
such rights or by way of ceiling on agricultural land or
in any other way;
e. ceiling on urban property;
65
f. elections to either House of Parliament or the House
or either House of the Legislature of a State, but
excluding the matters referred to in article 329 and
article 329A;
g. production, procurement, supply and distribution of
food-stuffs (including edible oilseeds and oils) and
such other goods as the President may, by public
notification, declare to be essential goods for the
purpose of this article and control of prices of such
goods;
h. rent, its regulation and control and tenancy issues
including the right, title and interest of landlords and
tenants;
i. offences against laws with respect to any of the
matters specified in sub-clauses (a) to (h) and fees
in respect of any of those matters;
j. any matter incidental to any of the matters specified
in sub-clauses (a) to (i).
3. A law made under clause (1) may -
a. provide for the establishment of a hierarchy of
tribunals;
b. specify the jurisdiction, powers (including the power
to punish for contempt) and authority which may be
exercised by each of the said tribunals;
c. provide for the procedure (including provisions as to
limitation and rules of evidence) to be followed by
the said tribunals;
d. exclude the jurisdiction of all courts, except the
jurisdiction of the Supreme Court under article 136,
with respect to all or any of the matters falling within
the jurisdiction of the said tribunals;
66
e. provide for the transfer to each such tribunal of any
cases pending before any court or any other authority
immediately before the establishment of such tribunal
as would have been within the jurisdiction of such
tribunal if the causes of action on which such suits or
proceedings are based had arisen after such
establishment;
f. contain such supplemental, incidental and
consequential provisions (including provisions as to
fees) as the appropriate Legislature may deem
necessary for a effective functioning of, and for the
speedy disposal of cases by, and the enforcement
of the orders of, such tribunals.
4. The provisions of this article shall have effect
notwithstanding anything in any other provision of this
Constitution or in any other law for the time being in force.
67
ADMINISTRATIVE TRIBUNALS ACT 1985
Pursuant to the provisions of article 323A, Parliament
enacted the Administrative Tribunals Act, 1985 (Act) to
establish an Administrative Tribunal for the Union, viz., the
Central Administrative Tribunal and a separate Administrative
Tribunal for a State or a Joint Administrative Tribunal for two or
more States. The establishment of Administrative Tribunals
became necessary since a large number of cases relating to
service matters were pending before various courts. It was
expected that the setting up of the Administrative Tribunals
would not only reduce the burden of courts, but would also
provide speedy relief to the aggrieved public servants. The
Central Administrative Tribunal, came into force on 1st July
1985. The Central Administrative Tribunal was established with
effect from 2nd October 1985. The provisions of the
Administrative Tribunals Act 1985 do not apply to members of
the military or any paramilitary force, officers or employees of
the Supreme Court or any High Court or courts subordinate
thereto, persons appointed to the secretarial staff of either
House of Parliament or any State Legislature. A person who
is, or has been, a Judge of a High Court heads an Administrative
Tribunal as its Chairman.
It has 17 regular benches, 15 of which operate at the
principal seats of High Courts and the remaining two at
Jaipur and Lucknow. These Benches also hold circuit
sittings at other seats of High Courts. In brief, the tribunal
consists of a Chairman, Vice-Chairman and Members.
The Members are drawn, both from judicial as well as
administrative streams so as to give the Tribunal the
benefit of expertise both in legal and administrative
spheres.
68
After the constitution of the Central Administrative Tribunal
in 1985, in the beginning, under section 29 of the
Administrative Tribunals Act 1985, the Tribunal received
on transfer from the High Courts and subordinate courts
13,350 cases, which were pending there.
In Kamal Kanti Dutta v. UOI43, the then Chief Justice of
India,
Hon’ble Mr. Justice Y. V. Chandrachud, speaking for the
majority, observed:
“The constitution of Service Tribunals by State
Governments with an apex Tribunal at the Centre, which, in the
generality of cases, should be the final arbiter of controversies
relating to conditions of service, including the vexed question
of seniority, may save the courts from the avalanche of writ
petitions and appeals in service matters. The proceedings of
such tribunals can have the merit of informality and if they will
not be tied down to strict rules of evidence, they might be able
to produce solutions which will satisfy many and displease only
a few.”
The enactment of the Administrative Tribunals Act 1985
opened a new chapter in the sphere of administering justice
to the aggrieved Government servants in service matters. The
setting up of the Administrative Tribunals is founded on the
premise that specialist bodies comprising both trained
administrators and those with judicial experience would, by
virtue of their specialized knowledge, be better equipped to
dispense speedy and efficient justice. It was expected that a
judicious mix of judicial members and those with grass-root
experience would best serve this purpose.44
43 (1980) 4 SCC 38
44 Department-related Parliamentary Standing Committee on Personnel, Public
Grievances, Law and Justice, Seventeenth Report on the Administrative Tribunals
(Amendment) Bill, 2006, December 2006, paragraph 6
69
The Administrative Tribunals are distinguishable from the
ordinary courts with regard to their jurisdiction and procedure.
They exercise jurisdiction only in relation to the service matters
of the litigants covered by the Act. They are also free from the
shackles of many of the technicalities of the ordinary courts.
The procedural simplicity of the Act can be appreciated from
the fact that the aggrieved person can also appear before it
personally. The Government can also present its case through
its Departmental officers or legal practitioners.
Administrative adjudication, which is quasi-judicial in
nature, is the main function of the Administrative Tribunals. The
basic objective of enacting the Administrative Tribunals Act
1985 was:
i) to relieve congestion in the ordinary courts; and
ii) to provide for speedy disposal of disputes relating
to service matters.45
The establishment of the Administrative Tribunals was a
right step in the direction of providing an effective alternative
authority to Government employees who feel aggrieved by the
decisions of the Government, in spite of the elaborate system
of rules and regulations which govern personnel management,
for judicial review over service matters to the exclusion of all
courts including High Courts other than the Supreme Court,
with the end in view of reducing the burden of such Courts and
of securing expeditious disposal of such matters.46
Section 22(1) of the Administrative Tribunals Act 1985
provides that the Tribunal shall not be bound by the procedure
laid down in the Code of Civil Procedure, 1908 but shall be
guided by the principles of natural justice and subject to the
other provisions of the Act and of any rules made by the Central
45 Department-related Parliamentary Standing Committee on Personnel, Publi Grievances,
Law and Justice, First Report on Demands for Grants (2004-2005) of the Ministry of
Personnel, Public Grievances and Pensions, August 2004, paragraph 28.1
46 Report of the 18th Law Commission, Report No.214
70
Government, the Tribunal shall have power to regulate its own
procedure including the fixing of places and times of its inquiry
and deciding whether to sit in public or in private.
Section 28 of the Administrative Tribunals Act excludes
jurisdiction of all courts except the jurisdiction of the Supreme
Court, as envisaged under sub-clause (d) of clause (2) of the
Article 323A of the Constitution. Accordingly, the jurisdiction
of High Courts under articles 226/227 as regards service
matters is excluded by the Act.
Lord Denning had once commented,” If tribunals were to
be at liberty to exceed their jurisdiction without any check by
the courts, the rule of law would be at an end.”
Consequent upon the establishment of service Tribunals
in the country ‘under the Administrative Tribunals Act, 1985’, a
string of litigation had erupted before the High Courts of several
States and also in Supreme Court, questioning the validity of
certain provisions of the Act and also the vires of Articles 323-
A and 323-B.47
47 Firstly, the ‘Apex Court’ by a Five Judge Constitution Bench, headed by the then
Hon’ble Chief Justice, Justice P.N. Baghavathi, examined the constitutional validity of
Article 323-A and its provisions in S.P. Sampath Kumar Vs. Union of India and others
A.I.R 1987 Supreme Court page 386). The said Bench while upholding the validity of
Article 323-A, held that the Service Tribunals created under Article 323-A are
substitutes to the High Courts and the exclusion of the jurisdiction of High Courts is
legal.
Thereafter, a seven Judge Constitution Bench of the Supreme Court in ‘L. Chandra
Kumar Vs. Union of India and others case (Reported in AIR 1997 Supreme Court ?
page 1125) while dealing with power of judicial review vested in High Courts and
Supreme Court under Articles 226,227 and 32 respectively vis-a-vis Articles 323-A
and 323-B not only deviated from the earlier discussion of the Supreme Court in ‘S.P.
Sampath Kumar’s case’, but also held that, the Tribunals are supplementary in their
role and the power of ‘Judicial Review’ vested in High Courts and Supreme Court
under Articles 226, 227 and 32 is an inviolable basic structure of the Constitution and
struck down clause 2(d) of Article 323-A and clause 3(d) of Article 323-B of the
Constitution of India to the extent they exclude the jurisdiction of High Courts and
Supreme Court under Articles 226/227 and 32 as unconstitutional and also Section
28 of the ‘Administrative Tribunals Act, 1985’ which excludes the jurisdiction of High
Courts.
71
TRIBUNALS AND JUDICIAL REVIEW
Judicial Review is a salient feature of our Constitutional
system. Whenever new legislations or enactments are passed,
either by Parliament or Legislative Assemblies, it is generally
found that, they, being tested in courts of law, either on their
validity as a whole or certain provisions of such acts if they are
offending any provisions of Constitution, any public policy or
established legal principles.
Jurisdiction of the Supreme Court under article 32 was
restored. Constitutional validity of the Act was finally upheld in
S. P. Sampath Kumar 48 subject, of course, to certain
amendments relating to the form and content of the
Administrative Tribunals. The suggested amendments were
carried out by another amending Act (Act 51 of 1987).Thus
became the Administrative Tribunals an effective and real
substitute for the High Courts.
In 1997, a seven-Judge Bench of the Supreme Court in L.
Chandra Kumar [JT 1997 (3) SC 589] held that clause 2 (d)
of article 323A and clause 3(d) of article 323B, to the extent
they empower Parliament to exclude the jurisdiction of the High
Courts and the Supreme Court under articles 226/227 and 32
of the Constitution, are unconstitutional. Section 28 of the Act
and the “exclusion of jurisdiction” clauses in all other legislations
enacted under the aegis of articles 323A and 323B would, to
the same extent, be unconstitutional. The Court held that the
jurisdiction conferred upon the High Courts under articles 226/
227 and upon the Supreme Court under article 32 of the
Constitution is part of the inviolable basic structure of our
Constitution. All decisions of the Administrative Tribunals are
subject to scrutiny before a Division Bench of the High Court
within whose jurisdiction the Tribunal concerned falls.
48 (1987) 1 SCC124
72
As a result, orders of the Administrative Tribunals are
being routinely appealed against in High Courts, whereas this
was not the position prior to the L. Chandra Kumar’s case.
On 18th March 2006, the Administrative Tribunals
(Amendment) Bill, 2006 (Bill No. XXVIII of 2006) was
introduced in Rajya Sabha to amend the Act by incorporating
therein, inter alia, provisions empowering the Central
Government to abolish Administrative Tribunals, and for appeal
to High Court to bring the Act in line with L. Chandra Kumar.
The Department-related Parliamentary Standing Committee
on Personnel, Public Grievances, Law and Justice in its 17th
Report on the said Bill did not subscribe to the same and as
for the provision for appeal to High Court expressed the view
that the original conception of the Administrative Tribunals be
restored and appeal to High Court is unnecessary, and that if
a statutory appeal is to be provided it should lie to the Supreme
Court only.
In the above backdrop, the Law Commission took up the
study on the subject suo motu. The Administrative Tribunals
were conceived as and constitute an effective and real
substitute for the High Courts as regards service matters.
Moreover, the power of judicial review of the High Courts cannot
be called as inviolable as that of the Supreme Court. The very
objective behind the establishment of the Administrative
Tribunals is defeated if all the cases adjudicated by them have
to go before the concerned High Courts. If one appeal is
considered to be a must, an intra-tribunal appeal would be the
best option, and then the matter can be taken to the Supreme
Court by way of special leave petition under article 136. The
Law Commission is of the view that L. Chandra Kumar’s case
needs to be revisited by a Larger Bench of the Supreme Court
or necessary and appropriate amendments may be effected
73
in the Act in accordance with law and 18th Law Commission
have recommended accordingly.
CONSTITUTION OF INDIA
Article 32 - Remedies for enforcement of rights conferred
by this Part (III)
1. The right to move the Supreme Com by appropriate
proceedings for the enforcement of the rights conferred
by this Part is guaranteed.
2. The Supreme Court shall have power to issue directions
or orders or writs, including writs in the nature of habeas
corpus, mandamus, prohibition, quo warranto and
certiorari, whichever may be appropriate, for the
enforcement of any of the rights conferred by this Part.
3. Without prejudice to the powers conferred on the Supreme
Court by clauses (1) and (2), Parliament may by law
empower any other court to exercise within the local limits
of its jurisdiction ill or any of the powers exercisable by
the Supreme Court under clause (2).
4. The right guaranteed by this article shall not be suspended
except as otherwise provided for by this Constitution.
CONSTITUTION OF INDIA
226. Power of High Courts to issue certain writs
1. Notwithstanding anything in article 32 2 [***] every High
Court shall have powers, throughout the territories in
relation to which it exercise jurisdiction, to issue to any
person or authority, including in appropriate cases, any
Government, within those territories directions, orders or
writs, including 3 [writs in the nature of habeas corpus,
mandamus, prohibition, quo warranto and certiorari], or
any of them, for the enforcement of any of the rights
conferred by Part III and for any other purpose].
74
2. The power conferred by clause (1) to issue directions,
orders or writs to any Government, authority or person may
also be exercised by any High Court exercising jurisdiction
in relation to the territories within which the cause of action,
wholly or in part, arises for the exercise of such power,
notwithstanding that the act of such Government or
authority or the residence of such person is not within those
territories.]
3. Where any party against whom an interim order, whether
by way of injunction or stay or in any other manner, is made
on, or in any proceedings relating to, a petition under clause
(1), without—
(a) furnishing to such party copies of such petition and
all documents in support of the plea for such interim
order; and
(b) giving such party an opportunity of being heard,
makes an application to the High Court for the vacation of
such order and furnishes a copy of such application to the
party in whose favour such order has been made or the
counsel of such party, the High Court shall dispose of the
application within a period of two weeks from the date on
which it is received or from the date on which the copy of
such application is so furnished, whichever is later, or
where the High Court is closed on the last day of that
period, before the expiry of the next day afterwards on
which the High Court is open; and if the application is not
so disposed of, the interim order shall, on the expiry of
that period, or, as the case may be, the expiry of the said
next day, stand vacated.]
4. The power conferred on a High Court by this article shall
not be in derogation of the power conferred on the
Supreme Court by clause (2) of article 32.]
75
Article 227 - Power of superintendence over all courts by
the High Court
1. Every High Court shall have superintendence over all
courts and tribunals throughout the territories in relation to
which it exercises jurisdiction.]
2. Without prejudice to the generality of the foregoing
provisions, the High Court may—
(a) call for returns from such courts;
(b) make and issue general rules and prescribe forms
for regulating the practice and proceedings of such
courts; and
(c) prescribe forms in which books, entries and accounts
shall be kept by the officers of any such courts.
3. The High Court may also settle tables of fees to be allowed
to the sheriff and all clerks and officers of such courts and
to attorneys, advocates and pleaders practicing therein:
Provided that any rules made, forms prescribed or
tables settled under clause (2) or clause (3) shall not be
inconsistent with the provision or any law for the time being
in force, and shall require the previous approval of the
Governor.
4. Nothing in this article shall be deemed to confer on a High
Court powers of superintendence over any court or tribunal
constituted by or under any law relating to the Armed
Forces.
S. P. SAMPATH KUMAR TO L. CHANDRA KUMAR AND
THE IMPACT :
In S. P. Sampath Kumar v. UOI, the constitutional validity
of the Administrative Tribunals Act 1985 was challenged on
the ground of exclusion of power of judicial review both of the
Supreme Court under article 32 and of the High Courts under
76
articles 226 and 227 of the Constitution. During the hearing of
the case, the Act was amended and the jurisdiction of the apex
Court under article 32 was restored. The Supreme Court in
final decision held that section 28 of the Administrative
Tribunals Act 1985 which excludes jurisdiction of the High Courts
under articles 226/227 is not unconstitutional.The Court ruled
that this section does not totally bar judicial review. It also said
that Administrative Tribunals under the 1985 Act are substitute
of High Courts and will deal with all service matters even
involving articles 14, 15 and 16. It also advised for changing
the qualifications of Chairman of the Tribunal. As a result, the
Act was further amended in 1987.49
In Union of India v. Parma Nanda50 a three-Judge Bench
of the Supreme Court upheld the authority of the Administrative
Tribunals to decide the constitutionality of service rules. In
Sampath Kumar’s case, the issue of constitutionality of article
323A (2) (d) was neither challenged nor upheld and it could
not be said to be an authority on that aspect. Subsequently, a
Full Bench of the Andhra Pradesh High Court in Sakinala
Harinath v. State of AP51 declared sub-clause (d) of clause (2)
of Article 323A unconstitutional. It held that this provision is
repugnant to the ruling of the Supreme Court in Kesavananda
Bharati v. State of Kerala.52
Meanwhile, the two three-Judge Benches of the apex Court
in R.K. Jain v. UOI53 and L. Chandra Kumar v. UOI54 also
recommended that the Sampath Kumar ruling be
reconsidered. Therefore, a Bench of seven Judges of the
49 K. C. Joshi, Constitutional Status of Tribunals, 41 JILI 116 (1999)
50 AIR 1989 SC 1185
51 (1994) 1 APLJ (HC) 1
52 (1973) 4 SCC 225
53 (1993) 4 SCC 119
54 (1995) 1 SCC 400
77
Supreme Court examined the issues in a wider perspective
including the constitutionality of article 323A (2) (d). It also
considered the power of the Administrative Tribunals to
exercise the powers and jurisdiction of the High Courts under
articles 226 and 227 of the Constitution.
In L. Chandra Kumar’s case, the Supreme Court, contrary
to Sampath Kumar, held that these tribunals are not equal to
the High Courts. It further declared that the decisions of such
tribunals shall be appealable before a Bench of two Judges in
the High Court under whose jurisdiction the tribunal falls.
However, most importantly, these tribunals have been given
the quasi-equal status of High Courts in restricted areas. Thus,
the tribunals established under article 323A can still examine
the constitutionality of an enactment or rule concerning matters
on the anvil of articles 14, 15 and 16 of the Constitution. A
similar power will vest in the tribunals created under the authority
of article 323B.
The justification for inserting articles 323A and 323B in
the Constitution remains valid today. The pendency of cases
in the High Courts and the Supreme Court has posed an
imminent danger to the administration of justice. Therefore,
there is ample scope for the administrative tribunals. The short
experience of working of these tribunals has not been bad
although there is need for further improvement. In view of the
common law prejudice, the constitutionality of these tribunals
created under articles 323A and 323B has been frequently
impugned. Fortunately, the Supreme Court has upheld the
objective for which these tribunals have come into existence.
Their journey from Sampath Kumar to L. Chandra Kumar has
not been sterile. L. Chandra Kumar has not overruled
Sampath Kumar. It has firmly accepted the role of the
78
administrative tribunals in the administration of justice system.
The Supreme Court in Sampath Kumar further elaborated this
point:
“The basic and essential feature of judicial review cannot
be dispensed with but it would be within the competence of
Parliament to amend the Constitution so as to substitute in
place of the High Court, another alternative institutional
mechanism or arrangement for judicial review, provided it is
not less efficacious than the High Court.”55
Hon’ble Mr. justice Ranganath Misra, who wrote the
majority judgment in Sampath Kumar, after mentioning that
judicial review by the Supreme Court is left wholly unaffected
held:
‘Thus exclusion of the jurisdiction of the High Court does
not totally bar judicial review. This court in Minerva Mills’ case56
did point out that “effective alternative institutional mechanisms
or arrangements for judicial review” can be made by
Parliament. Thus it is possible to set up an alternative institution
in place of the High Court for providing judicial review. … The
Tribunal has been contemplated as a substitute and not as
supplemental to the High Court in the scheme of administration
of justice. … Thus barring of the jurisdiction of the High Court
can indeed not be a valid ground of attack.'
In L. Chandra Kumar, the seven-Judge Constitution
Bench of the Supreme Court considered the following broad
issues:
1. Whether the power conferred upon Parliament or the State
Legislatures, as the case may be, by sub-clause (d) of
clause
55 Supra note 17, Para 130
56 AIR 1980 SC 1789
79
2. of Article 323A or by sub-clause (d) of clause (3) of Article
323B of the Constitution, to totally exclude the jurisdiction
of ‘all courts’, except that of the Supreme Court under
Article 136, in respect of disputes and complaints referred
to in clause (1) of Article 323A or with regard to all or any
of the matters specified in clause (2) of Article 323B, runs
counter to the power of judicial review conferred on the
High Courts under Articles 226/227 and on the Supreme
Court under Article 32 of the Constitution?
2. Whether the Tribunals, constituted either under Article
323A or under Article 323B of the Constitution, possess
the competence to test the constitutional validity of a
statutory provision/rule?
3. Whether these Tribunals, as they are functioning at
present, can be said to be effective substitutes for the High
Courts in discharging the power of judicial review? If not,
what are the changes required to make them conform to
their founding objectives?
The Supreme Court, on 18.03.1997, held as under:
‘… clause 2(d) of Article 323A and clause 3(d) of Article
323B, to the extent they exclude the jurisdiction of the High
Courts and the Supreme Court under Articles 226/227 and 32
of the Constitution, are unconstitutional. Section 28 of the Act
and the “exclusion of jurisdiction” clauses in all other legislations
enacted under the aegis of Articles 323A and 323B would, to
the same extent, be unconstitutional. The jurisdiction conferred
upon the High Courts under Articles 226/227 and upon the
Supreme Court under Article 32 of the Constitution is part of
the inviolable basic structure of our Constitution. While this
jurisdiction cannot be ousted, other courts and Tribunals may
perform a supplemental role in discharging the powers
conferred by Articles 226/227 and 32 of the Constitution.’
80
It was further held:
“The Tribunals are competent to hear matters where the
vires of statutory provisions are questioned. However, in
discharging this duty, they cannot act as substitutes for the High
Courts and the Supreme Court which have, under our
constitutional set-up, been specifically entrusted with such an
obligation. Their function in this respect is only supplementary
and all such decisions of the Tribunals will be subject to scrutiny
before a Division Bench of the respective High Courts. The
Tribunals will consequently also have the power to test the vires
of subordinate legislations and rules. However, this power of
the Tribunals will be subject to one important exception. The
Tribunals shall not entertain any question regarding the vires
of their parent statutes following the settled principle that a
Tribunal which is a creature of an Act cannot declare that very
Act to be unconstitutional. In such cases alone, the concerned
High Court may be approached directly. All other decisions of
these Tribunals, rendered in cases that they are specifically
empowered to adjudicate upon by virtue of their parent statutes,
will also be subject to scrutiny before a Division Bench of their
respective High Courts.”57
The Tribunals , however continued to act as the only courts
of first instance in respect of the areas of law for which they
have been constituted. By this, we mean that it will not be open
for litigants to directly approach the High Courts even in cases
where they question the vires of statutory legislations (except,
as mentioned, where the legislation which creates the particular
Tribunal is challenged) by overlooking the jurisdiction of the
concerned Tribunal.
It was also held that So long as the jurisdiction of the High
Courts under Articles 226/227 and that of this Court under
57 Ibid, paragraph 95
81
Article 32 is retained, there is no reason why the power to test
the validity of legislations against the provisions of the
Constitution cannot be conferred upon Administrative
Tribunals created under the Act or upon Tribunals created under
Article 323B of the Constitution. It is to be remembered that
apart from the authorisation that flows from Articles 323A and
323B, both Parliament and the State Legislatures possess
legislative competence to effect changes in the original
jurisdiction of the Supreme Court and the High Court. This
power is available to Parliament under Entries 77, 78, 79 and
95 of List I and to the State Legislatures under Entry 65 of List
II; Entry 46 of List III can also be availed of both by Parliament
and the State Legislatures for this purpose.”58
The Supreme Court has also held that no individual may
directly approach the Supreme Court in any matter decided
by the Administrative Tribunal. He must first approach the High
Court (Division Bench) and only thereafter he may approach
the Supreme Court under Article 136 of the Constitution.
The Supreme Court recommended that the Union
Government may initiate action in respect of appointments/
issue of the competence of those who man the tribunals, funds
and the question as to who is to exercise administrative
supervision over them and place all the tribunals under one
single nodal department, preferably, the Legal Department
(Ministry of Law).
As a result of this judgment, orders of the Central
Administrative Tribunal have now routinely been appealed
against in High Courts whereas this was not the position earlier.
Implications of L. Chandra Kumar:
58 Ibid, paragraph 85.
82
Professor K. C. Joshi, formerly Head of Law Department
and Dean, Faculty of Law, Kumaon University, has in his article
‘Constitutional Status of Tribunals’59 stated:
“Administrative Tribunals provide simple, cheap and
speedy justice. Dicey apprehended danger from such tribunals
to the liberty of subjects, but they have become a regular part
of the system of judicial administration. The British Parliament
enacted the Tribunals and the Inquiries Act in 1958 which has
not been consolidated in the 1971 Act. Prior to the Constitution
of India 1950, administrative adjudication was in vogue. The
Constitution prior to 1973 used the word tribunal in articles
136 and 227. In 1973, provision for the administrative tribunals
was specifically made by the Constitution (Thirty Second
Amendment) Act.
With the acceptance of welfare ideology, there was
mushroom growth of public services and pubic servants. The
courts, particularly, the High Courts were inundated with cases
concerning service matters. The Swaran Singh Committee,
therefore, inter alia, recommended the establishment of
administrative tribunals as a part of constitutional adjudicative
system. Resultantly, the Constitution (Forty-second
Amendment) Act, 1976 inserted Part XIVA in the Constitution
consisting of articles 323A and 323B. Article 323A provides
for the establishment of administrative tribunals for adjudication
or trial of disputes and complaints with respect to recruitment
and condition of service of persons appointed to public
services. Article 323B makes provision for the creation of
tribunals for adjudication or trial of disputes, complaints or
offences connected with tax, foreign exchange, industrial and
labour disputes, land reforms, ceiling on urban property,
elections to Parliament and State Legislatures, etc. None of
59 Supra note 17.
83
these two articles is self-executory. Parliament has exclusive
power to enact a law under article 323A, while both Parliament
and State Legislatures can make laws on matters of article
323B subject to their legislative competence.’
5. 15 The opinion expressed by the Supreme Court about
the retired Judges presiding the tribunals is not quite correct.
These retired Judges are experienced people, having spent
a major part of their life in adjudication work. They have decided
causes and controversies coming before them. They have
collected a rich experience and decision-making process.
They are well versed in the art of adjudication. They are fully
conversant with court processes. They have acquired a certain
expertise in dealing with matters, civil, criminal, tax, labour and
constitutional coming before them. In short, they represent a
rich pool of talent.
As stated earlier, in order to annihilate the monster of
backlog, a multi-pronged attack is indispensable. Constitutionmakers
had the vision to foresee that a situation may develop
where the talent of retired Judges will have to be enlisted and,
therefore, they had made ample provision in this behalf. Article
224A of the Constitution provides that notwithstanding anything
in Chapter IV in Part V of the Constitution, the Chief Justice of
a High Court for any State may at any time, with the previous
consent of the President, request any person who has held
the office of a Judge of any High Court, to sit and act as a
Judge of the High Court for that State, and every such person
so requested shall, while so sitting and acting, be entitled to
such allowances as the President may by order determine and
have all the jurisdiction, powers and privileges of, but shall not
otherwise be deemed to be, a Judge of that High Court.
There is a proviso which says that this power could only
be exercised with the consent of the person concerned. Rarely,
if ever, this power is invoked.
84
The judgment of the Supreme Court in L. Chandra Kumar
is also likely to lead to consequences, which are undesirable.
The Supreme Court is not correct in its assumption that the
reach and range of the power of judicial review of the Supreme
Court and that of the High Courts are identical. It has already
been pointed out above that the power of judicial review in
India, after Kesavananda’s case, covers the following three
cases. The courts have the power to strike down the following:
i) subordinate legislation which is ultra vires the parent
Act;
ii) legislations of Parliament and the State Legislatures
if they contravene the provisions of the Constitution;
and
iii) the constitutional amendments which violate the basic
structure of the Constitution.60
The Supreme Court in Kesavananda for the first time in
the history of democratic Constitutions of the world, assumed
to itself the third power mentioned above, i.e., the power to
declare constitutional amendments as unconstitutional if they
violate the basic structure of the Constitution. Some might feel
that the assumption of this power by the Supreme Court is
bad enough in the context of representative democracy. But
what is worse would be to extend the exercise of this enormous
power to the High Courts also and after Chandra Kumar to all
manner of tribunals. One bizarre consequence would be that
different High Courts are likely to strike down different
provisions of constitutional amendments in different States and
the Constitution of India which is the fundamental law of the
country would be in operation in a fractured and fragmented
manner. In fact, a Division Bench of the Andhra Pradesh High
60 V. Nageswara Rao and G. B. Reddy, Doctrine of Judicial Review and Tribunals:
Speed Breakers Ahead, 39 JILI 411 (1997)
85
Court in Sakinala Harinath v. Andhra Pradesh has struck down
Article 323A (2) (d) which ousted the jurisdiction of the High
Courts in service matters. Given the vagaries of unstable
coalition governments which depend on survival politics at any
cost, the possibility cannot be ruled out of collusive writ petitions
in the High Courts seeking the striking down of inconvenient
provisions of constitutional amendments, past, present or
future, without any party seeking a further appeal to the
Supreme Court conveniently. Now, thanks to the Chandra
Kumar judgment, these disastrous results can be extended to
different tribunals within the same State striking down different
provisions of the constitutional amendments on the ground of
violation of the so-called basic structure of the Constitution.61
Thus, as stated above, the Supreme Court ought not to
assimilate the judicial review of the High Courts to that of the
Supreme Court of India with regard to the basic structure
doctrine as propounded in Kesavananda. The Supreme Court
should exclusively reserve to itself the power to strike down
constitutional amendments for violating the basic structure of
the Constitution. Bestowing this power on the High Courts
would create terrible constitutional confusion and this confusion
would be worse confounded if it is further extended to all manner
of tribunals. While the Supreme Court on one hand expressed
its serious reservations about the quality of justice dispensed
by these service tribunals, the court on the other hand was
willing to distribute the power of judicial review under the
Kesavananda doctrine to all sorts of tribunals throughout the
country.62
It should be remembered that though Parliament has the
power under Article 32(3) to confer the power of judicial review
61 Ibid.
62 Ibid.
86
on “other courts” without prejudice to the power of the Supreme
Court under Article 32(1), it has not done that so far even when
it has established different tribunals under different enactments.
But in an extraordinary gratuitous gesture the Supreme Court
has done that in Chandra Kumar’s case while professing to
uphold the supremacy of judicial review in the name of
upholding the supremacy of the Constitution.63
The power of judicial review of the High Courts under article
226 is not as inviolable as that of the Supreme Court under
article 32. While article 32(4) preserves the supremacy of
judicial review of the Supreme Court there is no saving
provision under Article 226. Establishment of tribunals as
substitutes and not supplements to the High Courts as held by
the Supreme Court in Sampath Kumar’s case is perfectly in
tune with the letter and spirit of the Constitution.64
As the Supreme Court itself observed in Chandra
Kumar’s case, the establishment of tribunals system was
necessitated by certain compelling circumstances like the need
for expert bodies to deal with specialized categories of dispute
settlement, the need for cutting down delays in the justice
delivery modalities, and docket explosion in the ordinary courts
of the land. The very purpose and Srationale of those tribunals
would be defeated if all those cases have to go before the
concerned High Courts again. It is too late in the day to go
back to Dicey’s puritanical view of Rule of Law vis-à-vis Droit
Administratif. Establishment of Alternative Dispute Resolution
mechanism is now universally accepted in common law as
well as continental legal systems and also in other jurisdictions.
In L. Chandra Kumar, the Supreme Court was justifiably
perturbed over the functioning and quality of justice dispensed
63 Ibid.
64 Ibid.
87
by the tribunals. The composition of the tribunals also needs
particular attention. There is no doubt, that many remedial
measures have to be taken regarding the composition,
qualifications and mode of appointment of members of the
tribunals as well as the judges of different High Courts and of
the Supreme Court.
The Law Commission in the aforesaid Report, as regards
the position of the Administrative Tribunal after L. Chandra
Kumar, also observed:
“It is no longer an alternative mechanism to the High Court,
but a tribunal whose decisions are subject to scrutiny by the
High Court, albeit by a Division Bench. (As a matter of fact,
Shri Justice Shiva Shankar Bhat, a retired Judge of the
Karnataka High Court, who was appointed as Chairman of
the Karnataka State Administrative Tribunal, tendered his
resignation soon after the decision in L. Chandra Kumar was
rendered, complaining that inasmuch as the position and status
of the Tribunal has been downgraded by the said decision, he
cannot continue as the Chairman of the State Administrative
Tribunal). While striking down certain clauses of Articles 323-
A and 323-B of the Constitution …, the Supreme Court has at
the same time affirmed the soundness of the principle on which
these administrative tribunals are created. It did not agree with
the contention that these tribunals should be abolished
inasmuch as they have not proved effective in discharge of
their duties and have failed to achieve the object with which
they were created. The Supreme Court has also held that
though these tribunals are subject to the writ jurisdiction of the
High Courts, they are yet competent to decide questions
relating to the constitutional validity of the statutory provisions
and rules except, of course, the provisions of the Administrative
88
Tribunals Act 1985 under which they have been constituted.
The Supreme Court has also rejected that there ought to be
no technical/administrative members in these tribunals. They
said that these non-judicial members provide an input which
may not be available with the judicial members.
In the light of the above dicta of the Supreme Court, not
much room is left for the Law Commission of India to suggest
any substantial measures or recommendations with respect
to the functioning of these tribunals.”65
Statutory finality of tribunals will not affect the jurisdiction
of H.C. and SC. If the Tribunal ceases to have control over the
matter, forums are:-
(a) The appellate authorities/Court ( if provided under
the Statute constituting the tribunal)
(b) S.C. :- Under Art. 32 ( writs) and 136(Special leave
to Appeal By S.C.
(c) H.C. :-Under Art 226(writ jurisdiction) and 227(power
of Superintendence)
The power of H.C. and S.C. is recognized by the
Constitution so it can not be taken away by the statute. Review
of decisions of tribunals can be done on many grounds, e.g. If
the order is arbitrary, perverse, or malafide, not observed
natural justice, error apparent on the face of record or is based
on irrelevant considerations etc.
Powers of HC and SC under the constitution are very
limited and these courts are often very reluctant to interfere
with the decisions of specially constituted authorities.
65 162nd Report of the Law Commission of India vide para 4.5.
89
Doctrine of Res Judicata and
Administrative Tribunals
Section 1166 of the Code of Civil Procedure, 1908 covers
the doctrine of res judicata. Res judicata is a Latin term, it
means a thing adjudged. It is a rule that a final judgment on
the merits by a court having jurisdiction is conclusive between
the parties to a suit as to all matters that were litigated or that
could have been litigated in that suit.
The Indian legal system places a high importance on this
rule and courts employ the rule of res judicata to prevent
dissatisfied party from trying to litigate the issue a second time.
Res judicata will be applied to a pending lawsuit if several
facts can be established by the party asserting the res judicata
defense. First, the party must show that a final judgment on the
merits of the case had been entered by a court having
jurisdiction over the matter. This means that a final decision in
the first lawsuit was based on the factual and legal disputes
between the parties rather than a procedural defect, such as
the failure to serve the defendant with legal process.
The general principle of res judicata also applies to
administrative adjudication although section 11 of the C.P.C.
speaks of the civil suits only.
When, and to what extent an administrative decision is to
be given the effect of a judgment binding on the parties in
66 11.Res judicata
.- No Court shall try any suit or issue in which the matter directly and substantially in
issue has been directly and substantially in issue in a former suit between the same
parties, or between parties under whom they or any of them claim, litigating under
the same title, in a Court competent to try such subsequent suit or the suit in which
such issue has been subsequently raised’ and has been heard and finally decided
by such Court.
90
collateral proceedings has been said not to be governed by
logical rules. Commentators have treated the matter
functionally67, with rejection of any attempt , ”to lay down logical
rules to which numerous exceptions would have to be taken to
make them fit the law…”68 On the other hand judicial approach
has tended to be conceptual rather than pragmatic and
functional.
In the case of Bombay Gas Company v. Shridhar,69 it
was held that an award pronounced by Industrial Tribunal have
effect of res judicata between the same parties and thus it
was held that the Payment of Wages authority has no jurisdiction
to entertain the said question again.
In Bhopal Sugar Industries v. I.T.O.,70 the Income Tax
Officer refused to carry out clear and unambiguous directions
issued by income tax Tribunal. Observing that such refusal
would be against the fundamental principle of hierarchy of
courts, the Supreme Court stated, “Such a view is destructive
of the basic principles of the administration of justice.”
In the case of Bombay Gas Company v. Jagannath
Pandurang71 the Supreme court gave the observation that the
doctrine of res judicata is a wholesome one which is applicable
to not merely the matters governed by the provisions of the
Code of Civil Procedure but to all Litigations.
In case of Jain Exports v. Union of India,72 Supreme Court
stated “In a tier system undoubtedly the decisions of higher
authorities are binding on lower authorities and quasi-judicial
tribunals are also bound by this principle.”
It proceeds on the principle that there should be no
unnecessary litigations.
67 Hart, Ann Introduction to Administrative Law, 1940 , C. XV.
68 Note 1929, MICH. Law Review, 677, 679
69 AIR 1961 SC 1196
70 AIR 1961 S.C.182(185)
71 (1975) 4 SCC 690
72 (1988) 3 SCC 579 (585)
91
UNIT –VI
Principles of Natural Justice
6.1. Introduction
6.2 Right of hearing
6.3 Rule against bias
6.4 Speaking order
6.5 Exclusion of Natural Justice
6.6 Breach of Natural Justice -Effect

THE PRINCIPLE AND ESSENTIAL ELEMENTS OF NATURAL JUSTICE –

ITS HISTORICAL PERSPECTIVE AND ROLE OF Judiciary:
1. INTRODUCTION In a famous English decision in Abbott vs. Sullivan1 it is stated that
“The Principles of Natural Justice are easy to proclaim, but their precise extent is far less easy
of define”. It has been stated that there is no single definition of Natural Justice and it is only
possible to enumerate with some certainly the main principles. During the earlier days the
expression natural justice was often used interchangeably with the expression natural Law,
but in the recent times a restricted meaning has been given to describe certain rules of
Judicial Procedure. There are several decision of the Hon‟ble Supreme Court which are
sufficient to summarize and explain the two essential elements of Natural Justice namely a.
No man shall be Judge in his own cause b. Both sides shall be heard, or audi alteram partem
The other principles which have been stated to constitute elements of Natural Justice are
-------------------------------------------------------------------------------------- 1. (1952) 1 K.B.189
at 195 2 i. The parties to a proceedings must have due notice to when the Court/ Tribunal will
proceed. ii. The Court/Tribunal must act honestly and impartially and not under the dictation
of other persons to whom authority is not given by Law These two elements are extensions or
refinements of the two main principles stated above. How the expression Natural Justice
came? We have seen the essential elements of Natural Justice and its extensions or
refinements. In Maclean vs. The Workers Union2 it has bee stated as follows. „The phrase is,
of course, used only in a popular sense and must not be taken to mean that there is any justice
natural among men. Among most savages there is no such thing as Justice in the modern
sense. In ancient days a person wronged executed his own justice. Amongst our own
ancestors, down to the thirteenth century, manifest felony, such as that of a manslayer taken
with his weapon, or a thief with the stolen goods, might be punished by summary execution
without any form of trial. Again, every student has heard of compurgation and of ordeal; and
it is hardly necessary to observe that (for example) a system of ordeal by water in which
sinking was the sign of innocence and floating the sign of guilt, a system which lasted in this
country for hundreds of years, has little to do with modern ideas of justice. It is unnecessary
to give further illustrations. The truth is that justice is a very elaborate conception, the growth
of many centuries of civilization; and even now the conception differs widely in countries
usually described as civilized”.
-------------------------------------------------------------------------------------- 2. (1929) 1 Ch. 602,
624 3 How the Principles of Natural Justice developed over the years? The two essential
elements had been stated of which the first being that no man shall be Judge in his own cause.
Judges, like Caesar‟s wife, should be above suspicion. The Principle is not confined merely
to the case where the Judge is an actual party to a cause, but applies to a cause in which he
has an interest. An “Interest”, has been defined as a legal interest or a pecuniary interest and
is to be distinguished from “favour”. Such an interest will disqualify a Judge. The interest (or
bias) which disqualifies must be one in the matter to be litigated. A mere general interest in
the general object to the pursued will not disqualify a magistrate. The Interest or bias which
disqualifies is an interest in the particular case, something reasonable likely to bias or
influence the minds of the magistrates in the particular case. The Law in laying down this
strict rule has regard, not to the motive which might bias the Judge but it is to promote the
feeling of confidence in the administration of Justice. As the famous saying goes – Justice
should not only be done but should manifestly and undoubtedly be seem to be done. The
second principle – Audi Alteram Partem – as the maxim denotes that no one should be
condemned unheard. This principle could be broadly classified as under: i. party to an action
is prima facie entitled to be heard in his presence 4 ii. he is entitled to dispute his opponent‟s
case, cross examine his opponents witnesses and entitled to call his own witnesses and give
his own evidence before Court. iii. He is entitled to know the reasons for the decision
rendered by a Court/Tribunal. You are all aware about the famous decision of the Hon‟ble
Supreme Court in Union of India vs. Tulsiram Patel 3 . The issue before the Supreme Court
was relating to the interpretation of Articles 309, 310 and 311 of the Constitution of India and
in particular after the amendment of Clause 2 of Article 311 by the Constitution (forty second
amendment) Act, 1976, the second proviso to that clause. Thought the subject matter of the
decision related to a service matter and the safe guards conferred in Article 311 to persons
employed in Civil capacities under the Union of India or the State, the Supreme Court
analysed in depth the principles of natural justice. It was stated that the principles of natural
justice are not the creation of Article 14 of the Constitution of India and that Article 14 is not
their begetter but their Constitutional Guardian. The Supreme Court traced the ancestry of the
principle. ----------------------------------------------------------------------------- 3. AIR 1985
Supreme Court page 1416 5 In the case of Tulsirram Patel4 the Supreme Court considered
the issue as to how the principles of natural justice had been interpreted by Courts and within
what limits are they to be confined. It was stated that by a process of judicial interpretation
two rules have been evolved has representing the principles of natural justice in judicial
process, including therein quasi judicial and administrative process. They being a. no man
shall be a Judge in his own cause b. hear the other side – Audi Alteram Partem From the
above two rules a corollary has been deduced namely that he who shall decide anything
without the other side having been heard, although he may have said what is right, will not
have done what is right, in other words has it is how expressed, Justice should not only be
done but should manifestly be seem to be done. While considering the Audi Alteram Partem
rule it was observed that  a person against whom an order to his prejudice may be passed
should be informed of the charges against him.  Such person should be given an opportunity
of submitting his explanation which also include the right to no the oral and documentary
evidence which are to be used against him.  Witnesses who are to give evidence against him
be examined in his persons with right to cross examination them.  To lead his own evidence
both oral and documentary, in his defence.
----------------------------------------------------------------------------------- 4. Ibid 6 The Hon‟ble
Supreme Court in Viswanathan v. Abdul Wajid5 while adjudicating a civil dispute inrespect
of the Estate of one Ramalinge Mudaliar considered the scope of Section 13 of the Code of
Civil Procedure which deals with the effect of Foreign Judgments. For the purpose of the
natural justice it would be useful to refer to paragraph 40 and 41 of the Judgment which is as
follow: The plea that a foreign Judgment is contrary to natural justice has to be considered in
the light of the statute law of India and there is nothing in S.13 which warrants the
interpretation that a plea that a foreign judgment is contrary to natural justice is admissible
only of the party setting up the plea is not duly served, or has not been given an opportunity
of being heard. It is the essence of a judgment of a Court that it must be obtained after due
observance of the judicial process, i.e. the Court rendering the judgment must observe the
minimum requirements of natural justice – it must be composed of impartial persons, acting
fairly, without bias, and in good faith; it must give reasonable notice to the parties to the
dispute and afford each party adequate opportunity of presenting the case. A foreign
judgment of a competent court is conclusive even if it proceeds on an erroneous view of he
evidence or the law, if the minimum requirement of the judicial process are assured:
correctness of the judgment in law or on evidence is not predicated as a condition nfor
recognition of its conclusiveness by the municipal Court. Neither the foreign substantive law,
nor even the procedural law of the trial be the same or similar as in the municipal court. A
judgment will not be conclusive, however, if the proceeding in which it was obtained is
opposed to natural justice. The words of the statute make it clear that to exclude a judgment
under Cl. (d) from the rule of conclusiveness the procedure must be opposed to natural
justice. A judgment which is the result of bias or want of impartially on the part of a Judge
will be regarded as a nullity and the trial coram non judice.
-------------------------------------------------------------------------------------- 5. AIR 1963 SC page
1 7 The Hon‟ble Supreme Court in Canara Bank and others vs. Sri Debasis Das6 and others
reported in while considering the scope and ambit of the Canara Bank Officers Employees
(conduct) Regulations 1976 had analyzed in depth “Natural Justice” and “Audi Alteram
Partem”. The observation in the said Judgment could be summarized as follow:  Natural
Justice is another name of commonsense Justice.  Rules of Natural Justice are not codified
canons.  But they are principles ingrained into the conscience of man.  Natural Justice is
the administration of Justice in a commonsense liberal way.  Justice is based substantially
on natural Justice is based substantially on natural ideals and human values.  The
administration of Justice is to be freed from the narrow and restricted considerations which
are usually associated with a formulated law involving linguistic technicalities and
grammatical niceties.  It is the substance of Justice which has to determine its form.  The
expressions “Natural Justice” and “Legal Justice” do not present a water tight classification.
------------------------------------------------------------------------------------ 6. AIR 2003 Supreme
Court 2041 8  It is the substance of Justice which is to be secured by both ad when ever
legal Justice fails to achieve this solemn purpose, natural Justice is called in aid of legal
Justice.  Natural Justice relieves legal Justice from unnecessary technicality, grammatical
pedantry or logical prevarication.  It supplies the omissions of a formulated law.  As Lord
Buckmaster said, no form or procedure should ever be permitted to exclude the presentation
of a litigants defence.  The adherence to principles of Natural Justice as recognized by all
civilized States is of Supreme importance when a quasi – judicial body embarks on
determining disputes between the parties, or any administrative action involving civil
consequences is in issue.  Notice it is the first limb of the principle of Audit Alteram
Partem.  Adequate time should be given to make his representation. In recent time the
concept of Natural Justice has undergone a great deal of change. In the sense that what
particular rule of Natural Justice to be applied depends upon the facts of that case, the statute
governing the issue etc. The old distinction between an Administrative Act and Judicial Act
does not survive any longer. Every Administrative order which involves civil consequences
must follow the rules of Natural Justice. 9 The Hon‟ble Supreme Court has held that in the
absence of a notice and reasonable opportunity to a person to meet the case against him, the
order passed becomes wholly vitiated. Having held so the Principles of Natural Justice have
been interpreted by the Hon‟ble Supreme Court prescribing the limits to which they are to be
confined. What is known as “useless formality theory” was considered by the Hon‟ble
Supreme Court in M.C. Mehta vs. Union of India7 . In the said Judgment it was held “Before
we go into the final aspect of this contention, we would like to state that case relating to
breach of natural justice do also occur where all facts are not admitted or are not all beyond
dispute. In the context of those cases there is a considerable case law and literature as to
whether relief can be refused even if the Court thins that the case of the applicant is not one
of “real substance” or that there is no substantial possibility of his success or that the result
will not be different, even if natural justice is followed” The Hon‟ble Supreme Court in Bar
Council of India vs. High Court, Kerala8 , held that principles of Natural Justice cannot to be
put in a strait jacket formula, it must be viewed with flexibility and when there is complaint
of violation of Principles of Natural Justice the Court may insists on proof of prejudice before
interfering or setting aside an order.
------------------------------------------------------------------------------------ 7. AIR 1999 Supreme
Court page 2583 8. (2004) 6 SCC 311 10 In the earlier part this decision we had seen that
recording of reasons in an order passed by a Court or a Tribunal is also one of the principles
of the Audi Alteram Partem Rule. The Hon‟ble Supreme Court in Sri Jain Swetambar
Terapanthi VId (s) vs. Phundan Singh9 reported in was considering the validity of an
Appellate Court against and grant of injunction. In the said case the Trial Court granted an
order of injunction and the Appellate Court upset the order of injunction granted by the Trial
Court on the ground that the Trial Court has gone wrong in recording prima-facie
satisfaction. The Hon‟ble Supreme Court set aside the order of the Appellate Court on the
ground that the Appellate Court did not discuss the materials on record nor recorded contrary
finding. It would be useful to refer to the findings recorded by the Trial Court. “Petitioner has
been successful, in my opinion, to establish the prima facie cases in its favour. I am of the
opinion that if the order of temporary injunction, as prayed for, is not passed the interest of
Petitioner as well as students, staff and guardian will be adversely affected in view of the fact
that the allegations against O.P. Nos. 1 to 5 which have been established prima facie are very
serious. In view of that I am inclined to allow the instant Petition for temporary injunction.
------------------------------------------------------------------------------------ 9. AIR 1999 SC 2322
11 This finding of the Trial Court was reversed by the Appellate Court which came up for
consideration before the Hon‟ble Supreme Court in the said case. The Supreme Court while
analyzing the aspects regarding prima-facie satisfaction and the need to record reasons
observed as follows: It may be pointed out that it is one thing to conclude that the Trial Court
has not recorded its prima facie satisfaction on merits but granted the temporary injunction
and it is another thing to hold that Trial Court has gone wrong in recording the prima facie
satisfaction and setting aside that finding on the basis of the material on record because it has
not considered the relevant material or because it has erroneously reached the finding or
conclusions on the facts established. In the first situation, the appellate Court will be justified
in upsetting the order under appeal even without going into the merits of the case but in the
second eventuality, it cannot set aside the impugned order without discussing the material on
record and recording a contrary finding. The High Court proceeded to set aside the order of
the Trial Court on the first ground ignoring the aforementioned findings of the Trial Court,
the order under appeal is, therefore, unsustainable. In yet another case the Supreme Court
while considering a proceedings arising out of a general Court martial confirmed by Chief of
Army Staff reported in S.N. Mukherjee vs. Union of India10 observed that in view of the
expanding horizon of the principles natural justice, the requirement to record reason can be
regarded as one of the principles of natural justice which govern exercise of power by
administrative authorities. The rules of natural justice are not embodied rules.
------------------------------------------------------------------------------------- 10. AIR 1990
Supreme Court 1984 12 The extent of their application depends upon the particular statutory
framework where under jurisdiction has been conferred on the administrative authority. With
regard to the exercise of a particular power by an administrative authority including exercise
of judicial or quasi judicial functions the legislature, while conferring the said power, may
feel that it would not be in the larger public interest that the reasons for the order passed by
the administrative authority be recorded in the order and be communicated to the aggrieved
party and it may dispense with such a requirement. It may do so by making an express
provision to that effect. Such an exclusion can also arise by necessary implication from the
nature of the subject matter, the scheme and the provisions of the enactment. The public
interest underlying such a provision would outweigh the salutary purpose served by the
requirements cannot, therefore, the insisted upon in such a case. Therefore except in cases
where the requirements has been dispensed with expressly or by necessary implication, an
administrative authority exercising judicial or quasi judicial functions is required to record
the reasons for its decision. In the famous Maneka Gandhi vs. Union of India11 in the
Hon‟ble Supreme Court discussed the increasing importance of Natural Justice and observed
that Natural Justice is a great humanizing principle
--------------------------------------------------------------------------------------- 11. AIR 1978
Supreme Court 597 13 intended to invest law with fairness and to secure Justice and over the
years it has grown in to a widely pervasive rule. The Supreme Court extracted a speech of
Lord Morris in the House of Lords which is an very interesting speech (I quote). That the
conception of natural justice should at all stages guide those who discharge judicial functions
is not merely an acceptable but is an essential part if the philosophy of the law. We often
speak of the rules of natural justice. But there is nothing rigid or mechanical about them.
What they comprehend has been analysed and described in many authorities. But any
analysis must bring into relief rather their spirit and their inspiration than any precision of
definition nor precision as to application. We do not search for prescriptions which will lay
down exactly what must, in various divergent situations, be done. The principle and
procedures are to be applied which, in any particular situation or set of circumstances, are
right and just and fair. Natural justice, it has been said, is only “fair plat in action”. Nor do we
wait for directions from Paliament. The common law has abundant riches; there may we find
what Byles, J., called “the justice of the common law”. Thus, the soul of natural justice is fair
play in action and that is why it has received the widest recognition throughout the
democratic world. In the United States, the right to an administrative hearing is regarded as
essential requirement of fundamental fairness. And in England too it has been held that “fair
play in action” demands that before any prejudicial or adverse action is taken against a
person, he must be given an opportunity to be heard. The rule was stated by Lord Denning,
M.R. in these terms in Schmidt v. Secy. of State for Home Affairs13 : - “Where a public
officer has power to deprive a person of his liberty or his property, the general principle is
that it has not to be done without his being given an opportunity of being heard and of
making representations on his own behalf”.
--------------------------------------------------------------------------------- 13. (1969) 2 Ch. D 149
14 Natural Justice is a term of art that denotes specific procedural rights in the English legal
system and the systems of other nations based on it. Whilst the term natural justice is often
retained as a general concept, it has largely been replaced and extended by the more general
“duty to act fairly”. What is required to fulfill this duty depends on the context in which the
matter arises. There are two rules that natural justice is concerned with. These are the rule
against bias (nemo index in causa sua) and the right to a fair hearing (audi alteram partem).
The basis for the rule against bias is the need to maintain public confidence in the legal
system. Bias can take the form of actual bias, imputed bias or apparent bias. Actual Bias is
very difficult to prove in practice while imputed bias, once shown, will result in a decision
being void without the need for any investigation into the likelihood or suspicion of bias.
Cases from different jurisdictions currently apply two tests for apparent bias: the “reasonable
suspicion of bias” test and the “real likelihood of bias” test. One view that has been taken is
that the differences between these two tests are largely semantic and that they operate
similarly. The right to a fair hearing requires that individuals should not be penalized by
decisions affecting their rights or legitimate expectations unless they have been given prior
notice of the case, a fair opportunity to answer it, and the opportunity to present their own
case. The mere fact that a decision affects rights or interests is sufficient to 15 subject the
decision to the procedures required by natural justice. In Europe, the right to a fair hearing is
guaranteed by Article 6(1) of the European Convention on Human Rights, which is said to
complement the common law rather than replace it. The rules of natural justice are the
minimum standards of fair decision-making imposed on persons or bodies acting in a judicial
capacity. Where the relevant person or body is required to determine questions of law or fact
in circumstances where its decisions will have a direct impact on the rights or legitimate
expectations of the individuals concerned, an implied obligation to observe the principles of
natural justice arises. However, in the Code of Conduct there is an express requirement on the
Adjudicator to conduct any hearing in accordance with the principles of natural justice. In the
event of a hearing taking place or a decision being reached which breaches the principles of
natural justice, the person charged may seek a review of the hearing and/or decision in the
courts. The following are guidelines of natural justice. If an Adjudicator is in any doubt as to
the procedure he is proposing to adopt he should take legal advice. The rules of natural
justice consist of the right to a fair hearing; and the rule against bias. 16 THE RIGHT TO A
FAIR HEARING Rule of Fair Hearing:- Meaning:, Object & Ambit The second principle of
natural justice is audi alteram partem (hear the other side) i.e. no one should be condemned
unheard. It requires that both sides should be heard before passing the order. This rule insists
that before passing an order against any person reasonable opportunity of hearing must be
given to him. This rule implies that a person against whom an order to his prejudice is passed
should be given information as to the charges against him and should be given an opportunity
to submit his explanation thereto as in case of National Central Cooperative Bank v. Ajay
Kumar13 . Audi alteram partem is a fundamental to a fair procedure of fair hearing. This is
more far-reaching of the principles of natural justice as includes every question of a fair
procedure or due process. Even rule against bias could be considered a part of fair procedure,
since a fair hearing must be an unbiased hearing. According to De Smith14 no proposition
can be more clearly established that a man cannot incur the loss of liberty or property for an
offence by a judicial proceeding until he has had a fair opportunity of answering the case
against him. ---------------------------------------------------------------------------------------- 13.
A.I.R. 1994 S.C. 39. 14. Judicial Review of Administrative Action, 4th Edition p. (36). 17
According to H.W.R. Wade "this is the more far-reaching of the principle of natural justice,
since it can embrace almost every question of fair procedure or due process and its
implications can be worked out in general detail. He has further observed that the right to a
fair hearing has, thus, been used by the courts as a base on which to build a kind of code of
fair administrative procedure comparable to due process of law under the constitution of
United States." 15 In England the right to fair hearing has been used by the Courts as a base
on which to build a kind of code of fair administrative procedure, comparable to 'due process
of law' under the Constitution of the United States. In India, right to fair hearing has been
implied in Articles 14, 19 & 21 of the Constitution of India. A right to equality under Article
14 of Indian Constitution has given a new and dynamic meaning in the case of Maneka
Gandhi v. Union of India16 , any action which is arbitrary is a violation of equality clause.
An action is arbitrary if it is given without hearing. Reasonableness under Article 19 means
both substantive and Procedural. Procedural reasonableness means right to fair hearing.
---------------------------------------------------------------------------------------- 15. HWR Wade,
Administrative Law, 4th Edition p 421) 16. A.I.R. 1978 SC 597 18 „Procedure established by
law' under Article-21 means fair, just or right procedure. A procedure cannot be called a fair
procedure which denies a right to fair hearing. Article 311(2) of the Indian Constitution
expressly provides for a right to notice and reasonable opportunity as a safeguard against
arbitrary dismissal or removal from service. The right to fair hearing has international
dimensions. It is provided in the European Convention on Human Rights and Fundamental
Freedoms of 1950. Article 16(1) says that, "In the determination of his civil right and
obligations or any criminal charge against him, everyone is entitled to a fair and public
hearing within a reasonable time by independent and impartial tribunal established by law."
Similar provisions are there in the Universal Declaration of Human Rights (United Nation's,
1948) Articlel0. The right to fair hearing is a rule of ancient origin. In case of Bagg's17 , a
freeman of the borough of Plymouth had threatened and scandalised the mayor (in that he
turning the hinder part of his body in an inhuman and uncivil manner towards the aforesaid
Thomas Fowens, scoffingly, contemptuously, and uncivilly, with a loud voice,
------------------------------------------------------------------------------------- 17. (1615) 11 Co.
Rep.93 b 19 said to the mayor Come and kiss, Wade p-500). So he was disfranchised i.e.
removed from the office. It was held that penalty was unjustified in the absence of any
special power of disfranchisement; and that even if there had been such a power, the removal
would be void because it was not shown that a hearing had first been given. A century later
same rule was applied in the famous Bentley's case R. v. University of Cambridge18 , in
which the University had deprived that recalcitrant scholar of his degrees on account of his
misconduct in insulting the ViceChancellor's Court; but he was reinstated by a mandamus
from the Court of the king's Bench, on the ground that deprivation was unjustifiable and that,
in any case, he should have received notice so that he could make his defence, as required by
'the laws of God and man‟. According to Wade, this is a nice example of the old conception
of natural justice as divine and eternal law. However, the problem of modern administrative
law is: How for can this obvious principle of justice; be transplanted from its native judicial
soil into the territory of administration? Can the Courts impose an administrative technique of
their own devising by laying down standards, and are there any standards of universal
validity? The answer according to Wade,
--------------------------------------------------------------------------------------- 18. (1723) I Str. 557
Fortescue J), 20 "is that the Court have succeeded in enforcing the principle very widely,
broadly speaking in all cases where legal rights or status are affected by the exercise of
administrative power, „saving only cases where the difficulty is insuperable; and that
accordingly, natural justice has become a doctrine with a high decree of universally. It does
not follow that it need to be modeled strictly on court procedure, hearings need not always be
oral hearings, nor needed sources of evidence always be disclosed. But in general the notion
of a fair hearing extends to the right to have notice of the other side's case, the right to bring
evidence and the right to argue."19 This rule of natural justice intents to prevent the authority
from acting arbitrarily affecting the rights of the concerned person. Duty to give reasonable
opportunity to be heard will be implied from the nature of the functions to be performed by
the authorities which has the power to take punitive or damaging action. Even exective
authorities which take administrative action involving any deprivation or restriction on
inherent fundamental rights of citizen, must take care that justice is not only done but
manifestly appears to be done.
---------------------------------------------------------------------------------------- 19. HWR Wade,
Administrative Law, 4th Edition, p496. 21 In National Textile Workers Union v. P.R.
Ramakrishna20. The Hon'ble Supreme Court observed there is a peculiar and surprising
misconception of natural justice, in same quarters, that it is exclusively a principle of
administrative law. It is not. It is a first universal principle and, therefore, a rule of
administrative law. It is a part of the judicial procedure which is imported into the
administrative pressure because of its universality. The rule of audi alteram partem is one of
the basic principles of natural justice. It was held that in a winding up proceedings of a
company, its workers are entitled to appear at the hearing of the winding up petition whether
to support or to oppose it. They have a right to be heard if they so wish both before the
winding up petition is admitted and order for advertisement is made, as also after the
admission and advertisement of the winding up petition until and order is made for winding
up the company. Mr. Justice Bhagwati observed: "The audi alteram partem rule which
mandates that no one shall be condemned unheard is one of the basic principles of natural
justice and if this rule has been held to be applicable is a quasijudicial or even in an
administrative proceeding involving adverse civil consequences, it would a fortiori apply in a
judicial proceeding ---------------------------------------------------------------------------------------
20. A.I.R. 1983 S.C. 75 22 such as a petition for winding up of a company. It is difficult to
imagine how any system of law which is designed to promote justice through fair play in
action can permit the court to make a winding up order which has the effect of bringing about
termination of services of the workers without giving them an opportunity of being heard
against the making of such order. It would be violative of the basis principles of fair
procedure and unless there is express provisions in the Companies Act, 1956, which forbids
the workers from appearing at the hearing of the winding up petition and participating in it,
the workers must be held entitled to appear and be heard in the winding up petition." Mr.
Justice O. Chinnappa Reddy observed, "It is of the essence of most systems of justice
certainly of the Anglo-saxon system--that in litigation both side of a dispute must be heard
before decision. 'Audi Alteram Partem' was the aphorism of Augusrine which was adopted by
the court at that time when Latin maxims were fashionable." "Audi Alteram Partem' is as
much a principle of African as it is of English legal procedure: Courts even more than
administrator must observed natural justice." 23 Judicial and Quasi-Judicial Acts Until the
decision of House of Lord's in case of Ridge v. Baldwin21 , the right to fair hearing was
available to judicial or quasijudicial acts. Their Lordship's held that "every judicial act is
subject to the procedure required by natural justice and they then dominated the great
majority of administrative acts as judicial for this purpose. Instead of saying, as was in fact
the truth, that natural justice must be observed in both judicial and administrative act; the
courts stretched the meaning of judicial in an unnatural way. There seem to be nothing but a
circular argument; natural justice must be observed when the function is judicial; and the
function is called judicial when natural judicial ought to be observed. If every power
affecting some persons rights is called judicial, there is virtually no meaning left for
administrative. The term 'quasi-judicial' accordingly came into vogue, as an epithet for
powers which though administrative, were required to be exercised as if they were judicial
i.e. in accordance with natural justice. This at least was less of a misnomer than judicial, and
made it easier for the Court to continue the work of developing their system of fair
administrative procedure."
--------------------------------------------------------------------------------------- 21. (1964) A.C. 49
24 The common misconception is to regard a quasi-judicial function as inferior form of
judicial function rather than as superior form of administrative function. Judges are prone to
judicial and quasi-judicial together and contrast them with administrative, without
appreciating the quasi-judicial means administrative22 . This confusion which arose above,
was clear by Lord Reid in the case of Ridge v. Baldwin23 . Since than the principles of
natural justice are applied to administrative acts. In India the Courts were hesitant in the
immediate post Ridge v. Baldwin period and sometimes they still resort to this dischotomi of
classification; otherwise these principles are made applicable to administrative act. The true
should to be, 'the character of the authority was not what mattered was the character of the
power exercised. . If it adversely affected legal rights or interests, it must be exercised fair24 .
Statutory Inquiries and Hearings The House of Lords took an important stand in 1914 in case
of Local Board v. Arlidge25 , where a public inquiry had been held on appeal to the Local
Government Board by the owner of a house against the Hampstead Borough.
----------------------------------------------------------------------------------- 22. HWR Wade,
Administrative Law, pp. (504-5). 23. (1964) A.C. 40 24. Wade, Administrative Law, p.502
25. (I915)A.C.120 25 Council had made a closing order on the ground that Board had
dismissed his appeal without a fair hearing because he was not allowed to appear before the
officer to made the decision or to see the report of the Inspector who held the inquiry. The
report was, of course, the main document in the proceedings. These complaints succeeded in
the Court of Appeal but failed in the House of Lords. The judges all agreed that the general
importance of the case can scarcely be over estimated, where they differed was in their
willingness to compromise between the procedure of courts of law and the need of practical
administration. However, later on case of Errington v. Minister of Health26 , known Jarrow
clearance, the Court of Appeal enunciated the doctrine of Lis for the purpose of application of
the principle of natural justice. A public inquiry had been held but after receiving the report
the ministry made efforts persuade the Jarrow Corporation to accept less expensive scheme.
The Corporation registered and asked the minister to receive a deputation. The minister
replied that in view of his quasijudicial function he did not think he ought to receive a
deputation representing one side only. However, with the arrangement of a meeting
Corporation was to submit further evidence and argument to the ministry. The minister‟s
order was set aside by the Court.
------------------------------------------------------------------------------------- 26. (1935) 1 KB 249
26 According to Wade, "although by inventing the principle of the lis the courts contrived to
infuse a measure of natural justice into the statutory procedure at the point where it was most
needed, one must admit that mixture of administrative and judicial responsibilities makes it
difficult for the ministry to fulfil their function. When an objection is lodged, they must either
give up normal dealings with the local authority or else they must allow the objectors to
intrude into the daily work of the department. This state of semi-paralysis may last for many
months, from the first objector to the final decision……The notion of the lis, therefore, was
not the true key to the problem. It operated merely by reference to time, whereas the need
was for a distinction based on substance. Ultimately this was found in the distinction between
evidence of a general character used by the minister to guide him on policy, and evidence of
facts of the local situation investigated at the inquiry. The former may be obtained and used
by the minister as he likes. The latter should be handled only quasi-judicially and in
accordance with natural justice27 ." However, there is nothing like public inquiries system in
India as in England. Vast discretionary and arbitrary powers are vested in the authorities
which are exercised without regard to the principles of the
-------------------------------------------------------------------------------------- 27. HWR Wade,
Administrative Law, pp.511-12 27 natural justice, progress to arts tribunalisation and inquiry
system is painfully slow in India. Legitimate Expectation The doctrine of legitimate
exprectation is a new emerging concept in administrative law. Generally, the principles of
natural justice apply where some legal right, liberty or interest is affected. But good
administration demands their observance in other situation also where the citizen may
legitimately expect to be treated fairly. In a recent decision in case of Re estminister28 . Lord
Bridge has explained the court have developed a novel doctrine in public law that a duty of
consultation may arise from a legitimate expectation of the consultation aroused by a promise
or by an established practice of consultation. However, the above analysis is classical.
According to Wade29 "Legitimate expectation which means reasonable expectation can
equally well be invoked in any of many situation's where fairness and good administration
justify the right to be heard" The Supreme Court of India for the first time recognized the
doctrine of 'legitimate expectation' in the case of Union of India v. Hindustan Development
Corporation30 and has dealt with the English
-------------------------------------------------------------------------- 28. (1986) A.C. 668 29.
Administrative Law, p.522 30. A.I.R. 1994 S.C. 938 28 Law at length. The case is popularly
known as Railway Bogi case. However, Byles J's observations have become classical when
he said, "although there are no positive words in a statute, requiring that the party shall be
heard, yet the justice of common law will supply the omission of the legislature31." This was
approved by the House of Lords in case of Ridge v. Baldwin32 . In India, it has been
followed in case of Maneka Gandhi v. Union of India33 and Olga Tellis v. Bombay
Municipal Corporation34 . In case of Co-oper v. Wanderworth Board of Works35 observed:
"The law of God and man both give the party an opportunity to make his defence if he has
any. I remember to have heard it observed by a very learned man, upon such an occasion, that
even God himself did not pass sentence upon "Adam", before he was called upon to make his
defence. "Adam", says God, "Where aloe thou? Has thou not eaten 'an apple' of the tree
whereof I commanded thee that thou shouldest not eat?" "And the same question was put to
"Eve" also." ---------------------------------------------------------------------------------------- 31.
Wade A.L., Administrative Law, pp.502-3. 32. (1964) A.C. 40 33. A.I.R. 1978 S.C. 597 34.
A.I.R. 1986 S.C. 180 35. (1881) 73 All. E.R. 1554 Byles, J 29 It should be noted that this
principle of natural justice provides procedural safeguard against arbitrary administrative
adjudication. Justice will deemed to be denied. If a person against whom justice has been
invoked, has no opportunity to put his defence forward. In the words of Prof. Robson, "of all
the characteristics of judicial function, none is more essential than the right to hearing. The
safeguard of civil liberty finds expression in few principles of greater importance according
to English notions than that embodied in the maxim that every man is entitled to his way in
his court36." Ingredients of Fair Hearing: "Fair Hearing" involves a number of stages or
ingredients which are follows:-- (a) Notice Hearing starts with the notice by the authority
concerned to the affected person. Consequently, notice may be taken as the starting point of
hearing. Unless a person knows the case against him, he cannot defend himself. Therefore,
before the proceedings start, the authority concerned is
--------------------------------------------------------------------------------------- 36. Robson, Justice
of Administrative Law, Ch.11, p.74 30 required to give to the affected person the notice of
the case against him. The proceedings started without giving notice to the affected party,
would violate the principles of natural justice. The notice is required to be served on the
concerned person properly as in case of Laxmi Narain Anand C.S.T.37 and in another case of
Cooperative Society v. A.P. Govt.38 However, the omission to serve notice would not be
fatal if the notice has been served his own fault. For example, in a case of L.P. Singh v. Board
of Governors, M.A.C.T.39 , some students were guilty of gross violence against other
students. The notice could not be served on them because they had absconded. The action of
the authority was held to be valid as a notice could not served on the students on account of
their own fault. The notice must give sufficient time to the person concerned to his case as in
case of Public Prosecutor v. K.P. Chandrashekharan40. Whether the person concerned has
been allowed time or not, depends upon the facts of each case as in case of Satish Chandra v.
Union of India41 . ----------------------------------------------------------------------------------------
37. (1980) 46 S.T.C. 41 38. A.I.R. 1977 SC 313 39. A.I.R. 1982 M.P.59 40. (1957) 8 S.T,C.
6 (Mad) 41. A.I.R. 1983 Delhi, 1 31 The notice must be adequate and reasonable. In U.S.A.
the Administrative Procedure Act provides with request to the requirements of the notice. It
provides that the notice must contain time, place and nature of hearing, legal authority under
which the hearing is to be held, statement of specific charges to be met by the person
concerned and the matters of fact and law asserted. In India there is no statutory requirements
of notice but the courts insist the compliance with the above requirements in order to treat the
notice as reasonable and adequate. In order to be treated as adequate and reasonable the
notice must give sufficient information so as to enable the person concerned to prepare his
defence effectively. For this purpose, the contents of the notice, time of giving notice etc. are
taken into account. In a case of Punjab National Bank v. All India Bank Employees
Federation42 , the notice contained certain charges but the penalty was imposed on the
charges other than those mentioned in the notice. Thus, the charges on which the penalty was
imposed were not contained in the notice served on the person concerned. The notice was not
proper and, therefore, imposition of penalty was invalid. It is to be noted if the person
concerned is aware of the case against him and not prejudiced in preparing his defence
effectively -------------------------------------------------------------------------------------------- 42.
A.I.R. 1960 S.C. 16 32 the requirement of notice will not be insisted upon as a mere technical
formalities and proceeding will not be vitiated merely on the technical ground. That the
person concerned was not served notice before taking the action as in case of Keshav Mills
Co. Ltd. V. Union of India43 The notice is required to be clear and unambiguous. If it is
ambiguous or vague, it will not be treated as reasonable and proper notice. If the notice does
not specify the action proposed to be taken, it is taken as vague and, therefore, no proper as in
case of Abdul Latif v. Commr44 . The notice will also be vague if it does not specify the
property proposed to be acquired as in case of Tulsa Singh v. State of Haryana45 . As regards
the detention under any law providing for preventive, Clause (5) of Article 22 provides that in
such condition the making the order for such detention must, as soon as may be,
communicate to the detenu the grounds on which the order has been made and must give him
the earliest opportunity of making a representation against the order. The grounds
communicated to the detenu must not be vague or insufficient or irrelevant. If the grounds
furnished to the detenu are
------------------------------------------------------------------------------------ 43. A.I.R. 1971 S.C.
389 44. A.I.R. 1978 All. 44 45. A.I.R. 1973 Punj. 263 33 vague or inadequate, the detenu is
entitled to be released as in case of Dhananjoy Das v. D.M.46 . A ground is regarded vague if
it is not capable of being intelligibly understood and is not sufficiently definite to enable the
detenu to make effective representation. In the case of State of Bombay v. Atma Ram47 , the
Supreme Court has held that if the ground which is supplied is incapable of being understood
or is incapable of being defined with sufficiently certainty, it will be called vague, but if it is
capable of being intelligibly understood and is sufficiently definite to furnish materials to
enable the detenu to make a representation against the order of detention, it cannot be called
vague. If the ground supplied is vague, the detention will become invalid as in case of
Lawrence v. State of Bombay48 . Hence the notice should be served properly on the
concerned person. The notice should be legal giving sufficient time to the concerned person
to prepare his case. The notice must be proper, adequate and reasonable. The notice be vague
or ambiguous i.e. the notice should be clear and ambiguous
------------------------------------------------------------------------------------------ 46. A.I.R. 1982
S.C. 1315 47. A.I.R. 1951 S.C. 175 48. A.I.R. 1856 S.C. 531 34 (b) Hearing: - Oral or
Personal Hearing-- how far necessary The second ingredient of audi alteram partam (hear the
other side) rule is the rule of hearing. If the order is passed by the authority without providing
the reasonable opportunity of being heard to the person affected by it adversely will be
invalid and must be set aside as in the cases of Harbans Lal v. Commissioner49 , National
Central Co-operative Bank v. Ajay Kumar50 and Fateh Singh v. State of Rajasthan51. The
reasonable opportunity of hearing which is also well known as 'fair hearing' is an important
ingredient of the audi alteram partem rule. This condition may be complied by the authority
by providing written or oral hearing which is the discretion of the authority, unless the statue
under which the action being taken by the authority provides otherwise. Thus like U.S.A. and
England, the Courts in India do not consider the right to oral or personal hearing as part of the
principle of Audi Alteram Partem unless the statue under which the action is taken by the
authority provides for the oral or personal hearing
--------------------------------------------------------------------------------------- 49. (1970) Lab I.C.
1448 50. A.I.R. 1994 S.C. 39 51. A.I.R. 1995 Raj. 15 35 unless it is not indicated at without
oral or personal hearing the person cannot adequately present. Personal or oral hearing is
important when the context requires it was required in the case of A.K. Gopalan v. State of
Madras52 . It is the duty of the authority who will ensure that the affected party may be given
an opportunity of oral or personal hearing if the context requires otherwise. However, the
above rule of fair hearing requires that the affected party should be given an opportunity to
meet the case against him effectively and this may also be achieved by providing opportunity
to the affected person by making 'written representation' instead of oral or personal hearing as
was provided in the case of Union of India v. J.P. Mitter53 Whether the reasonable
opportunity of fair hearing should be given by a written representation or by personal hearing
or by oral hearing depends upon the facts of each case and ordinarily it is in the discretion of
the Tribunal instead of Courts as is the observation of Mr. Suba Rao in case of M.P.
Industries v. Union of India54 . If the technical or complex question are involved in the case
then the personal or oral hearing may be considered
------------------------------------------------------------------------------------ 52. A.l.R. 1950 S.C.
27 53. A.I.R. 1971 S.C. 1093 54. A.I.R. 1966 S.S. 671 36 necessary as in case of Travancore
Rayons v. Union of India55 . If otherwise all the circumstances of the case have been taken
into account before taking any action, it is very important to see that the action cannot be set
aside merely on the ground that the opportunity of oral or personal hearing has been denied as
in case of State of Maharashtra v. Lol" Sikshan Sansthan56 and Union of India v.
Prabhakar57 in a case of Bishan Lal v. State of Haryana58 , a probational was given an
adequate opportunity to answer in writing whatever was alleged against him in the show
cause notice served upon him and it is pertinent to mention as held by the court that it was not
necessary to give him personal or oral hearing before passing the order of termination of his
service. It is otherwise expressed as the principle that no man should be condemned unheard
as in case of R v. Archbishop of Canterbury59 and further in an early case of Capel v.
Child60, the principle was formulated as under: -
-------------------------------------------------------------------------------------- 55. A.I.R. 1971 S.C.
862 56. (1971) 2 S.C.C. 410 57. (1973) 4 S.C.C. 183 58. A.I.R.1978 S.C. 363 59. (1859) 1 E
& E 545 60. (1832) 2 C & J 558 (579) 37 "Is it not a common principle in every case which
has in itself the character of a judicial proceeding and that the party against whom the
judgment is to operate shall have an opportunity is being heard?" More explicit is the
pronouncement in a later case of Bonaker v. Evans61 that no proposition can be more clearly
established than that a man cannot incur the loss of liberty or property for an offence by a
judicial proceeding until he has had a fair opportunity of answering the charge against him
unless indeed the legisluture has expressly or impliedly given an authority to act without that
necessary prelimitarty‟ It has been pointed out earlier that it is agreed in England, in India
and U.S.A. that there is no universal rules as to the kind of hearing required by natural
justice. There is minimum which would be enforced even where the statute is silent,
providing the function is held to be quasijudicial. But above that, the nature of hearing
required is to be determined upon a construction of the governing statute as in case of Local
Govt. Board v. Arlidge62 , the nature of the function to be discharged by the authority in
question as in case of Gopalan v. The State63 and furthermore the facts and
------------------------------------------------------------------------------------ 61. (1850) 16 Q.B. 162
(171) 62. (1915) A.C. 120 (H.L.) 63. (1950) S.C.R. 88 (123, 163) 38 circumstances of the
case in point as in case of Local Govt. Board v. Arlidge where Lord Parmoor observed:-
"Where, however, the question of propriety of procedure is raised in a hearing before some
tribunal other than a court of law, there is no obligation to adopt the regular forms of judicial
procedure. It is sufficient that the case has been heard in a judicial spirit and in accordance
with the principles of substantial justice. In determining whether the principles of substantial
justice have been complied with in matters of procedure regard must necessarily be had to the
nature of the issue to be determined and the constitution of the tribunal". (c) Evidence
Evidence is an important part which is to be brought properly before the Court in the
presence of both the parties and a judicial or quasijudicial authority must have to act on the
evidence produced as in the case of R v. Bodmin JJ64 and not merely on any information
which the authority may receive otherwise as in the case of Collector of Central Excise v.
Sanwarmal65 --------------------------------------------------------------------------------------------
64. (1947) 1 All E.R. 109 65. (1968) S.C. [C.A. 1362/67 dt. 16.(J2.1968] 39 Ordinarily, no
evidence personal or oral should be received at the back of other party and if any such
evidence is recorded, it is duty of the authority that such evidence must be made available to
the other party as in the case of Stafford v. Minister of Health66 and in another case of Hira
Nath v. Principal67 . The principle is not confined to formal evidence but extends to any
material including information regarding previous conviction, upon which the Tribunal may
act, without giving opportunity to the affected party to rebut it. Thus, a conviction has been
quashed on the ground that the Justices received a note from their clerk in their chamber,
containing points for conviction before convicting the accused as in the case of Ross ex
parte68 . It is general principle that all the evidence which the authority wishes to use against
the party, should be placed before the party for his comment and rebuttal. If the evidence is
used without disclosing to the affected party, it will be against the rule of fair hearing as in
the case of State of Orissa v. Binapani69 and the extent and content of the information to
----------------------------------------------------------------------------------------- 66. (1946) K.B.
621 67. (1973) 1 S.C.C. 805 68. (1962) 1 All E.R. 540 69. A.I.R. 1967 S.C. 1269 40 be
disclosed depends upon the facts of each case as in Prem Prakash v. Punjab University70
Ordinarily the evidence is required to be taken in the presence of the party concerned but in
some situations this rule is relaxed. For example, where it is found that it would be
embarrassing to the witness to testify in the presence of the party concerned, the evidence of
the witness may be taken in the absence of the party. Thus the circumstances may exist in
which it may not be expedient to examine the witnesses before the affected party and in such
circumstances the evidence may be collected behind the back of the party concerned.
However, even in such condition the gist of the evidence so collected against the party
concerned must be brought to his notice and the party concerned should be given an
opportunity to rebut the evidence so collected. The party concerned should be given fair
opportunity for correcting or contradicting and relevant statement prejudicial to him as in of
Hira Natha Masra v. Rajendra Medical College71, some male students were charged of some
indecent behaviour towards some girl students. An enquiry committee was appointed and the
complainant girls testified
------------------------------------------------------------------------------------------- 70. A.I.R. 1972
S.C. 1408 71. A.I.R. 1973 S.C. 1260 41 before it in the absence of the accused male students
were given to the accused male students for their rebuttal. The supply of gist of evidence was
taken as sufficient compliance with the requirements of fair hearing. The court held that the
circumstances show at if the evidence of the girl students had been taken in the presence of
the accused male students, the girl students would have been exposed themselves to
retaliation and harassment. In case of Suresh Koshy v. University of Kerala72 a committee
was appointed to enquire into the alleged malpractice by a student during the examination.
After the enquiry a show cause notice was given to the student but the report of the enquiry
was not given to him. Nonfurnishing of a copy of the report on the basis of which the show
cause notice was issued was not taken as violation of the principle of natural justice. The
court made it clear that where the law provides for a show cause notice, it should not be taken
to mean that a copy of the report on the basis of which the notice has been issued should be
made available to the affected person. In case of Keshav Mill Co. v. Union of India73 the
Supreme Court was not ready to lay down an inflexible rule that it was not necessary
------------------------------------------------------------------------------------------- 72. A.I.R. 1969
S.C. 198 73. A.I.R. 1973 S.C. 389 42 to show the report of enquiry committee to the affected
person. The court made it clear that whether the report of the enquiry committee should be
furnished or not depends in every individual case on merits of the case. However, again in
case of Shadilal Gupta v. State of Punjab74 the Supreme Court has held that it is not
necessary to show the report of the enquiry-officer to the person affected. Recently the
Supreme Court has held that when an enquiry-officer is not the disciplinary authority, the
delinquent employee has a right to receive a copy of the enquiry-officers report before the
disciplinary authority arrives at its conclusion with regard to the guilt or innocence of the
employee with regard to the charges leveled against him. A denial of the enquiry-officers
report before the disciplinary authority takes its decision on the charges, is a denial of
reasonable opportunity to the employee to prove the innocence and is a and is a breach of the
principles of natural justice as in case of Managing Director, ECIL v. B. Karunakar75 and in
another case of Union of India v. Mohd. Ramzan Khan76
------------------------------------------------------------------------------------------- 74. A.I.R. 1973
S.C. 1124 75. (1993) 4 S.C.C. 727 76. (1991) 1 S.C.C. 588 43 (d) Cross Examination The
adjudicating authority in a fair hearing is not required only to disclose the person concerned
the evidence or material to be taken against him, but he should be provided an opportunity to
rebut the evidence or material. The important question before the authority is that the witness
should be cross-examined or not. It depends upon the provisions of the statute under which
the hearing is being held and facts and circumstances of each and every case whether it
includes the right of cross examination or not as reported in Jain & Jain, Principles of
Administrative law, p. 254. In some cases of domestic inquiries or departmental disciplinary
inquiries, the right of cross examination of witnesses or deliquent officials is regarded as
essential part of natural justice as in case of Phulbari Tea Estate v. Worlsmen77 and in case
of Meenglass Tea Estate v. Workmen78 . Where it was utmost necessary to cross examine
the workmen of both the estates to know the truth and find the facts of the case. In the case of
Central Bank of India v. Karunamoy79 where disciplinary proceedings are initiated by the
Govt. against the civil servants, the right to cross examination is included in the rule of
hearing. ------------------------------------------------------------------------------------------ 77.
A.I.R. 1959 S.C. 1111 78. A.I.R. 1963 S.C. 1719 79. A.I.R. 1968 S.C. 266 44 The right to
cross examination is not taken orally and inquiry is only a fact finding one as in case of State
of J & K v. Bakshi Gulan Mohd.80 where a commission of enquiry was appointed to enquire
into charges of corruption and real administration against the Ex.-Chief Minister of the State
of J & K. Several persons filed affidavits supporting the allegations. The Ex-Chief Minister
claimed the right to cross examination all the persons who had filed affidavits leveling the
charges of corruption against him who had filed the affidavits. His claim was disallowed by
the Court on the ground that the evidence was not given orally but only affidavits were filed
and the enquiry was only a fact finding one. In such cases where no oral hearing is held and
only written statements are called for from the affected party, there is no right of cross
examining of the witnesses as reported in Jain & Jain, Principle of Administrative Law, 4th
Edition, p256. If the witnesses give oral evidence, the person against whom the oral evidence
has been given has right to cross examine the witnesses and if he demand such a right and it
is refused and he is not allowed this right, the refusal to allow him to cross examine the
witnesses would amount to valuation of fair hearing as in case of Meenglass Tea Estate v.
Their Workmen81 .
------------------------------------------------------------------------------------------ 80. A.I.R. 1967
S.C. 122 81. A.I.R. 1967 S.C. 1719 45 However, there are certain exceptions to this rules. In
certain situations the cross examination may be embarrassing for the witnesses as in case of
Hira Nath Mishra v. Rajendra Medical College82. In such situation the right to cross
examination may be denied and denial in such situations would not amount to violation of
natural justice. In the above case some male students were charged off some indecent
behaviour towards some girl students. The accused male students were not allowed to
crossexamine the girl students. The refusal to allow the accused male students to cross
examine the girl students was upheld and was not treated as a violation of natural justice
because allowing the boys the right of cross examination would have been further more
embarrassing for the girl students and the refusal was necessary for protecting the girl
students for any harassment later on. Sometimes there is a danger of life or persons or
property of the witness if his identity is not kept confidential as in case of Gurubachan Singh
v. State of Bombay83 where the Deputy Commissioner under Police Act passed an
externment order which was served on a person of bad character who was not allowed to
cross examine the witnesses in order to
-------------------------------------------------------------------------------------------- 82. A.I.R. 1973
S.C. 1260 83. A.I.R. 1952 S.C. 221 46 keep the identity of the witnesses confidential and the
said persons of bad character was not allowed to cross-examine the witnesses. The refusal
was not taken as violation of the natural justice because the witnesses would not to give
evidence openly against the persons of bad character due to fear of violation to their persons
or property. In another case of Kanungo & Co. v. Collector of Customs84 the business
premises of a person were searched and certain watches were confiscated by the authority
under Sea Customs Act. The said person was not allowed to cross-examine the persons who
gave information to the authority. There was no violation of the natural justice and the Court
held that the principles of natural justice do not require the authority to allow the person
concerned the right to cross examine the witnesses in the matters of seizure of goods under
the Sea Customs Act. If the person concerned is allowed the right to cross-examine, it is not
necessary to follow the procedure laid down in the Indian Evidence Act. In U.S.A. the right
to cross examination has been included in the due process of law and the Administrative
Procedure Act, 1946.
-------------------------------------------------------------------------------------------- 84. A.I.R. 1972
S.C. 2136 47 (e) Legal Representation An important question is whether right to be heard
includes right to legal representation? Fairly speaking, the representation through a lawyer in
the administrative adjudication is not considered as an indispensable part of the fair hearing.
But, in certain situations if the right to legal representation is denied, then it amounts to
violation of natural justice. Thus where the case involves question of law as in case of J.J.
Mody v. State of Bombay85 and in another case of Krishna Chandra v. Union of India86, the
denial of legal representation will amount of violation of natural justice because in such
conditions the party may not be able to understand the question of law effectively and,
therefore, he should be given an opportunity of being heard fairly. Similarly there is violation
of natural justice if in cases where the subject matter is complicated and technical and the
party is denied the right of legal representation as in case of Natya Raiyan v. State87 where
the party may not be able to understand the complication and technicality of the matter
whereas a legal representative may plead the case properly and further defend the interest of
the party not to be harmed. In such cases,
---------------------------------------------------------------------------------------- 85. A.I.R. 1962
Guj. 197 86. (1947) 4 S.C.C. 374 87. A.I.R. 1962 Ori. 78 48 where the person or party is
illiterate as in case of James Bukshi v. Collector of Ganjam88 or in such cases where the
expert evidence is on record as in case of Harish Chandra v. Registrar, Co-op. Societies89 or
the prosecution is conducted by legally trained persons as in case of C.L. Subramaniam v.
Collector of Custom90 and the case of The Board of Trustees, Port of Bombay v. Dalip
Kumar91, the denial of right to legal representation in the above mentioned circumstances
would certainly be the violation of natural justice because the illiterate persons will not be
able to plead his case as effectively as a legal representative or counsel may represent fairly
watching the interest of the affected party. Article 21 provides that no person shall be
deprived of his life or personal liberty except according to procedure established by law and
the right to life and personal liberty guaranteed by Article 21 of the Constitution of India may
be curtailed or taken away by following the procedure established a law. The procedure
prescribed for deprivation of personal liberty must be reasonable, fair, just and a procedure to
be reasonable fair and just, must embody the principles of natural justice as
-------------------------------------------------------------------------------------- 88. A.I.R. 1959 Ori.
152 89. (1966) 12 F.L.R. 141 90. A.I.R. 1972 S.C. 2178 91. A.I.R. 1983 S.C. 100 49 in case
of Maneka Gandhi v. Union of India92 . Free legal aid to the poor is an essential element of
reasonable, fair and just procedure and a procedure which failed to provide for free legal
service to the poor and needy persons cannot be referred as reasonable, fair and just and
thereby it would be voilative of Article 21 as in case of Hussainara v. Home Secretary93 and
in the case of M.H. Hoskot v. State of Maha94. In short, this is the Constitutal right of every
accused person who is unable to engage a lawyer and secure legal services on account of
reason such as poverty, indigace etc. and the state is under a mandate to provide a lawyer to
an accused person. If the circumstances of the case and the need of justice so required,
provided of course, the accused person does not object to the provision of such lawyer. In
case of Khatri v. State of Bihar95 the Court has held that the state is bound to provide legal
aid to the poor or indigent accused and the right cannot be denied on the ground that the
accused did not ask for it and it is further the duty of the Presiding Officer to inform the
accused of such rights. ---------------------------------------------------------------------------- 92.
A.I.R. 1978 S.C. 598 93. A.I.R. 1979 S.C. 1360 94. A.I.R, 1978 S.C. 1548 95. A.I.R. 1981
S.C. 928 50 In U.S.A. the right to legal representation has been granted by the process clause
of the U.S. constitution and the Administrative Procedure Act of 1946. The right to a fair
hearing requires that an individual shall not be penalised by a decision affecting his rights or
legitimate expectations unless he has been given prior notice of the case against him, a fair
opportunity to answer it and the opportunity to present his own case. Each individual must
have the opportunity to present his version of the facts and to make submissions on the
relevant principles of the Code of Conduct and the allegations against him. The right to a fair
hearing involves Prior notice of the hearing, opportunity to be heard, conduct of the hearing,
right to legal representation and the decision and the reasons for it. THE RULE AGAINST
BIAS The two main aspects of this rule are that a person adjudicating on a dispute must have
no pecuniary or proprietary interest in the outcome of the proceedings and must not
reasonably be suspected, or show a real likelihood, of bias. The Adjudicator must be able to
show that he has conducted a full enquiry into the circumstances involved before making his
decision as to whether a breach of the Rules of Conduct has occurred and, if so, what
sanction should be imposed. There 51 should be no suggestion in his conduct of the hearing
that prior to its commencement he has irrevocably decided the outcome. In this century, as in
the past, Judges and others have used the phrase „natural justice‟ in a way which implies the
existence of moral principles of self-evident and unarguable truth. To justify the adoption or
continued existence of a rule of law on the ground of its conformity to natural justice in this
sense conceals the extent to which a judge is making a subjective moral judgment and
suggests, on the contrary, an objective inevitability. Natural justice used in this way is
another name for „natural law‟ although devoid of some at least of the theological and
philosophical overtones and implications of that concept. But before entering into
implications of the doctrine of natural justice, it is necessary to explain the historical basis of
importing this doctrine to test the validity of the decisions of administrative tribunals. It
should be pointed out that the initial application of the doctrine of natural justice was to
“Courts” i.e. to say, in respect of judicial functions and it is from that sphere that the doctrine
has been extended to statutory authorities or tribunals exercising “quasi-judicial” functions
and later, to any administrative authority who has the function of determining civil rights or
obligations. In England where there are no written guarantees of rights as in India or the
U.S.A., it is controlled by common law principles of natural justice. 52 2. History of Natural
Justice in England ENGLAND: Natural justice is an expression of English common law and
involves a procedural requirement of fairness. Without going into the ramifications of the
doctrine of the natural justice at this stage, it may be said that the doctrine as understood in
England, rests on two broad principles resting on Latin maxims which were drawn by
common law from “justice naturale”, as in case of Local Govt. v. Arlidge. In the 19th
Century, the phrase came to be applied by the superior courts in controlling the decisions of
courts of summary jurisdiction and it was asserted that any court of justice or judicial tribunal
must observe these minimum safe guard of natural justice for justice to be done i.e. being
impartial and without bias and further no man should be condemned unheard, otherwise
failing which the decisions would lose their judicial character. That these are the essential
requirements of a judicial decision would appear from the notable words of Viscount Haldane
as in case of Local Govt. v. Arlidge96 : “…………..those whose duty it is to decide must act
judicially. They must deal with the question referred to them without bias and they must give
to each of the parties the opportunity of adequately presenting the case made. The decision
must come to the spirit and with the sense of responsibility of a tribunal whose duty it is to
mete out justice.” ---------------------------------------------------------------------------- 96. (1915)
A.C. 120(138) H.L. 53 This essential similarity is clearly demonstrated by Lord Esher M.R‟s
definition of natural justice as “the natural sense of what is right and wrong”, as in case of
Voinet v. Barrett97. Lord Mansfield founded liability to repay money had and received on
“natural justice and equity”, as in case of Moses v. Macferlan98 . Some years later Lord
Kenyon declared that “it is a principle of natural justice and our laws that actus non facit
reum nisi mens sit rea,” as mentioned in case of Fowler v. Padget99 . In the 19th Century
Kindersley V.C. invoked natural justice in case of Rice v. Rice100 to help to determine the
conflicting priorities of two equitable interests. Lord Watson, in discussing the right of a
mortgage to tack (i.e. to claim for subsequent advances to the mortgagor the same priority, as
against other mortgages, as his original loan enjoyed) said often earlier English decision as in
case of Hopkinson v. Rolt101 , which, it was argued, was inapplicable to Skotland, “the
principle of that decision does not rest upon any rule or practice of English conveyancing but
upon principles of natural justice,”
----------------------------------------------------------------------------------------- 97. (1885) 55
L.J.Q.B. 39(41) 98. (1760) 2 Burr, 1005(1012) 99. (1798) 7 T.R. 509(514) 100. (1853) 2
Drew 73(79) 101. (1861) 9 H.L.C. 514 54 as in case of Union Bank of Scotland Ltd. v.
National Bank of Scotland102. Examining the origin of the right of a cargo owner to general
average contribution Brett M.R. said in case of Burton & Co. v. English & Co.103 ,
“……………it seems to me that the right arose at the time of the making of the Rhodian
laws, it is consequence of the peculiarity of sea danger and has become incorporated into the
municipal law of England as a law of the ocean and of marine risk, because when two parties
were jointly in danger of the same misfortune, natural justice required that any loss falling
upon one party for the safety of the whole adventure should be recouped by the other party in
proportion ,” The two principles which, pre-eminently, are generally thought to be necessary
to guarantee that the law or any body or rules, is applied impartially and objectively---and
hence justly --- are that no man should be judged without a hearing and that every judge must
be free from bias or as they are often cited in the form of latin tags, audi alteram partem and
nemo judex in re sua. It is not possible to produce an exhaustive list of the rules of natural
justice in this formal sense or of the requirements of the rules, because the rules of natural
justice are means to an end and not an end themselves, as in case of Official Solocitor
V.K.104 In the words of Tucker L.J.,
----------------------------------------------------------------------------------------- 102. (1886) 14 R.
(H.L.), 1(5) 103. (1883) 49 L.T. 768(769) 104. (1965) A.C. 201 55 “the requirements of
natural justice must depend on the circumstances of the case, the nature of the inquiry, the
rules under which the tribunal is acting, the subject matter i.e. being dealt with and so forth”,
as in case of Russell v. Duke of Norfolk105 . Whatever the uncertainly inherent in the phrase
„natural justice, it connotes, above all, the maxims audi alteram partem (i.e. hear the other
side) and nemo judex re sua (i.e. a judge should be impartial and without bias) because they
are “ so vital and essential to the due performance of the office of the judge that without them
the judge is no judge at all”. Green L.J. put it more tersely in Errington‟s case i.e. Errington
v. Minister of Health106 . “a judge must hear both sides and must not hear one side in the
absence of the other”. It is logical, therefore, with the growth of the administrative tribunals
and other statutory bodies, the duty to decide the rights of the parties judicially came to be
vested by law in bodies other than courts; as in case of R. v. London Country Council107 .
The application of the principles of natural justice came to be extended to these „quasi-
judicial‟ authorities as well. In the case of Lapointe v. L‟ Association108 , the Judicial
Committee thus observed:-
-------------------------------------------------------------------------------------- 105. (1949) All E.R.
109(113) 106. (1935) 1 K.B. 249 (268) 107. (1931) 2 K.B. 215(233) 108. (1906) K.C. 535
(539) 56 “The rule (audi alteram partem) is not confined to be conduct of strictly legal
tribunals, but is applicable to every tribunal or body of persons invested with authority to
adjudicate upon matters involving civil consequences to individuals”. In an appeal from
Malaya, the Judicial Committee in the case of Kanda v. Fed. of Malaya109, Lord Denning
has summarized the principle thus; “If the right to be heard is to be a real right which is worth
anything, it must carry with it a right in the accused man to know the case which is made
against him. He must know what evidence has been given and what statements have been
made effecting him and then he must be given a fair opportunity to correct of contradict
them.. It follows, of course, that the judge or whoever had to adjudicate must not hear
evidence or receive representation from one side behind the back of the other. The court will
not inquire whether the evidence or representations did work to his prejudice. Sufficient that
they might do so. The court will not go into the likelihood of prejudice. The risk of it is
enough”. -------------------------------------------------------------------------------------- 109. (1962)
2 W.L.R. 1153 (P.C.) 57 3. History of Natural Justice in U.S.A. U.S.A. :- In the United
States, the expression, „natural justice‟, as such is not so frequently heard of, it appears to
have been used in the early case of Calder v. Bull110 and in case of Ex parte Robinson111,
because it is not necessary to rely on common law when „due process‟ is to be affected by
State action (5th and 14th Amendments.) „Due process‟ is a vague and undefined expression,
the implications of which are not finally settled even today. But, thanks to the genius of the
American judiciary, it has secured the observance of the minimum requirement of justice
embodied in the principle of natural justice, by taking advantage of the very vagueness of the
phrase „due process‟ as in case of Caritativo v. California112 In the hands of Supreme Court,
the phrase early came to evolve two-fold meaning-substantive and procedural and the
principle of natural justice were considered to be implied in the procedural aspect of due
process. The American Supreme Court in case of Brown v. Walker113 described the first
eight amendments to the constitution as incorporating into “the fundamental law of the land
certain principles of natural justice which has become permanently fixed in the jurisprudence
of the mother country”.
----------------------------------------------------------------------------------------- 110. (1798) 3 Dall
396(398 f) 111. (1896) 86 U.S. 505 112. (1957) 357 U.S. 549 (558) 113. (1896) 161 U.S.
591, (600) 58 Thus the court included within the phrase such various provisions as those
recognizing the right to free speech and right to speedy and public trail of criminal charges;
those prohibiting double jeopardy, excessive bail, cruel and unusual punishments; and those
protecting the security of homes from searches or billeting of troops, the right of citizen to
bear arms and the right to trial by jury. Thus, in case of Synder v. Massachussets114, the
Supreme Court observed that there was a violation of due process whenever there was a
breach of a “principle of justice so rooted in the traditions and conscience of our people as to
be ranked as fundamental” and in the early case of Hagar v. Reclamation District115 , the
Court had formulated the view that „hearing‟ before decision was one of such fundamental
principle and that accordingly, „due process‟ required inter alia that….. “whenever it is
necessary for the protection of the parties, it must give them „an opportunity to be heard‟
respecting the justness of the judgment sought.” It is thus to be seen that three ingredients of
procedural due process as summarized by Prof. Willis in his “Willis, Constitutional Law, pp
642- 43”, basically correspond to the English common law principle of natural justice.
---------------------------------------------------------------------------------------- 114. (1934) 291
U.S. 97, (105) 115. (1884) 111 U.S. 701 59 4. History of Natural Justice in India INDIA:-
Our constitution has conferred upon the superior Courts the same supervisory jurisdiction
over inferior courts and tribunals as gave rise to the doctrine of natural justice in England and
once it is conceded that there are certain fundamental requirements the absence of which
vitiates any judicial or quasi-judicial decision effecting the right of individuals, a proposition
for which no specific constitutional authority is required as in the case of Manak Lal v. Prem
Chand116. Our superior Courts cannot help applying these requirements while exercising
their jurisdiction under Arts. 32 & 226 to issue writ certiorari as in case of N.P.T. Co. v.
N.S.T. Co.117 or the supervisory jurisdiction of the High Court under Art. 227 as in case of
Waryam v. Amarnath118 or the extraordinary power of appeal vested by Art. 136 in the
Supreme Court as in the case of D.C. Mills v. Commr. of I.T.119 On the other hand, a
constitutional requirements of the compliance with the principle of natural justice is derived
from the expression „reasonable restriction‟ in cls. (2-6) of Art.19 as in case of Hari v. D.C.
of Police120 & Fedco v. Bilgrami121 . The difference in the application of doctrine of
natural justice in England on the one hand and U.S.A. and in India, on the other hand is that
where ----------------------------------------------------------------------------------------- 116. (1957)
S.C.R. 575 (580-581) 117. (1957) S.C.R. 98(100) 118. (1954) S.C.R. 565 119. (1955) S.C.R.
941 (950) 120. (1956) S.C. 559 121. (1960) S.C.J. 235(249). 60 „due process‟ or
reasonableness is a constitutional safeguard and it cannot be taken away or abridged as in
England by ordinary legislation. Principle of Natural Justice occupied the very important
place in the study of the administrative law. These rules are not embodied rules which are not
fixed in any Code. They are the judgemade principle and are regarded counter part of the
American procedural „due process‟. Any judicial or quasi-judicial tribunal determining the
rights of individuals must confirm to the principle of natural justice in order to maintain „the
rule of law‟ as in Representation of the Committee on Minister‟s Powers (1932) C.md. 4060
p.75. The reason is that these principles constitute the „essence of justice‟ and must,
therefore, be observed by any person or body charged with the duty of deciding the rights of
the parts of the party which involves the duty to act judicially as in case of Spackman v.
Plumstead Board of Works122 & in another case of General Medical Council v.
Spackman123 . Though both in England and India it has been held that there is no universal
or uniform standard of natural justice applicable to all cases coming within the purview of the
doctrine and that the contents or requirements of natural justice vary with the varying
constitution of different quasi-judicial bodies and their functions, the subject matter of
inquiry, the relevant statutory provisions as in case of Local Govt. Board v. Arlidge124 & in
another case of Board of Education v. Rice125 and the other circumstances of the case,
nevertheless, it is agreed on all hands that there are certain
---------------------------------------------------------------------------------- 122. (1885) 10 App.
Cas. 229(240) 123. (1943) A.C. 627(641) 124. (1915) A.C. 120 125. (1911) A.C. 179(182)
61 broad principles deducible from the two Latin maxims which form the foundation or basis
of the doctrine of natural justice and extend to all cases where the doctrine is attracted. These
principles have been developed to secure justice and to prevent miscarriage of justice as in
case of A.K. Kraipak v. Union of India126. They require fair play in action. Earlier these
principles were applied only to the judicial functions but later on their ambit was extended to
the quasi-judicial function and at present these principles apply not only to the judicial and
quasi-judicial functions, but also to the administrative functions as in case of Ridge v.
Baldwin127. It has now been established that the distinction between the quasi-judicial and
administrative functions is not relevant as duty to hear is attracted wherever an action is
likely to have civil consequences to a person as in case of Mohinder Singh v. Chief Election
Commissioner128. As mentioned on page 32 in book of Administrative Law by K.J. Edeey,
the basic principle is that where a person or public body has the power in reaching a decision
to affect the rights of subjects, then that person must comply with what have become known
as the rules of natural justice and the real test is the effect of the decision on the right of the
----------------------------------------------------------------------------------------- 126. A.I.R. (1970)
S.C. 150 127. (1964) A.C. 49 128. A.I.R. 1978 S.C. 851 62 person affected. The dividing line
between administrative power and quasi-judicial power is quite thin and is being gradually
obliterated and the horizon of the natural justice is gradually expanding and now the
principles of natural justice has been extended even to pure administrative function as in
cases of A.K. Kraipak v. Union of India129, Ridge v. Baldwin130 & Maneka Gandhi v.
Union of India131 . These principles of natural justice are treated as a part of the
Constitutional guarantee contained in Art. 14 and the violation of these principles by the
administrative authorities is taken as violation of Art 14. Actually the concept of quasi-
judicial, natural justice and fairness all have been developed to control the administrative
action. The object has been to secure justice and prevent miscarriage of justice. The concept
of rule of law would have its importance if the administrative authorities are not charged with
the duty of discharging their functions in fair and just manner. Art 14 & 21 have strengthened
the concept of natural justice. Art. 14 applies not only to discriminatory class legislation but
also to discriminatory or arbitratory state action. Violation of the principle of natural justice
results in arbitrariness and, therefore, its results in the violation of Art. 14. Art. 21 requires
substantive and procedural due process and it provides that no person shall be deprived of his
life or person liberty except according to the procedure
----------------------------------------------------------------------------------------- 129. A.I.R. (1970)
S.C. 150 130. (1964) A.C. 49 131. A.I.R. 1978 S.C. 579 63 established by law. The
procedure prescribed for deprivation of person liberty must be reasonable, fair, just and a
procedure to be reasonable, fair and just must embody the principle of natural justice. A
procedure which does not embody the principles of natural justice cannot be treated as
reasonable, just and fair as in case of Vionet v. Barrett132 . The concept of natural justice has
been defined by many judges, lawyers and scholars. In Drew v. Drew and Lebum, it has been
defined by Lord Granworth as „universal justice‟. Sir Robert P. Collier viewed natural justice
as „requirements of substantial justice‟ in case of James Dunber Smit v. Her Majesty The
Queen133. In Voinet v. Barreet134, Lord Esher M.R. has defined as „the natural sense of
what is right and wrong‟. Subsequently in Hopkins v. Smethwick Local Board of Health135,
Lord Esher M.R. instead of taking the definition of the natural justice given by him earlier
choose to define it as „fundamental justice‟. The rule of natural justice are not embodied
rules and, therefore, it is not possible and practicable to precisely define the parameters of
natural justice. Tucker L.J. in case of Russell v. Duke of Norfolk136 has observed
----------------------------------------------------------------------------------- 132. (1885) 55 LJ RB,
29 133. (1877-78) 3 app.Cas. 614 134. (1885) 55 LJ B.R. 135. (1863) 14 C.B. (N.S.), 214
136. (1949) 1 All E.R. 109 (C.A.) 64 “there are, in my view, no words which are of universal
application to every kind of inquiry and very kind of domestic tribunal. The requirements of
natural justice must depend on the circumstances of the case, the nature of inquiry, the rules
under which the tribunal is acting, the subject matter i.e. being dealt with and so forth”. The
Supreme Courts has observed in case of Union of India v. P.K. Roy137 that the extent and
application of the doctrine of natural justice depends upon the nature of the jurisdiction
conferred on the administrative authority, upon the character of the rights of the persons
affected, the scheme and policy of the statute and other relevant circumstances disclosed in
the particular case. In A.K. Kraipak v. Union of India138 the Supreme Court has observed
“What particular rule of natural justice should apply to a given case must depend to a great
extent on the facts and circumstances of that case, the framework of the law under which the
inquiry is held and the constitution of the Tribunal or body of persons appointed for that
purpose. Whenever a complaint is made before a court that some principle of natural justice
has been contravened, the court has to decide whether the observance of that rule was
necessary for a just decision on the facts of that case.” Rule of natural justice are foundational
and fundamental concepts. They are regarded part of the legal and judicial procedures and
--------------------------------------------------------------------------------------- 137. A.I.R. (1968)
S.C. 850 138. A.I.R. (1970) S.C. 150 65 they are further applicable not only to judicial or
quasi-judicial bodies but also the administrative bodies in its decision-making process having
civil consequences. The earlier view as in case of Franklin v. Ministry of Town & Country
Planning139, that the principles of natural justice were applicable to the judicial and quasi-
judicial orders only and not to the administrative orders has been changed now. Both in
English Law and in India the courts have made it clear that the principle of natural justice in
applicable in administrative proceedings as in case of A.K, Kraipak v. Union of India140. In
Sate of Orisa v. Birapani Dei141 the Supreme Court has specifically held that even an
administrative order which involve civil consequences must by made consistently with the
rules of natural justice. The important question is what is the meaning of the „civil
consequences‟ has been made clear in case of Mohinder Singh Gill v. Chief Election
Commissioner142 where the Supreme Court has held that „civil consequences covers‟ covers
infraction of not merely property or personal right but of civil liberties, material deprivations
and nonpecuniary damages. In its comprehensive connotation everything that affects a citizen
in his civil life inflicts a civil consequences.‟
----------------------------------------------------------------------------------------- 139. (1947) 2 All
E.R. 289 (H.L.) 140. A.I.R. (1970) S.C. 150 141. A.I.R. (1967) S.C. 1269 142. (1978) 1
S.C.C. 405 66 As regards the application of the principles of natural justice the distinction
between quasi-judicial and administrative order has gradually become thin and now it is
totally eclipsed and obliterated. The aim of the rules of natural justice is to secure justice or
put it negatively to prevent miscarriage of justice and these rules operate in are not covered
by law validly made or expressly excluded. The rules of natural justice would apply unless
excluded expressly or by implication. EXCEPTIONS TO THE RULE OF NATURAL
JUSTICE It is a general rule that every person whose rights are affected by the administrative
actions is entitled to claim natural justice. The Courts have generally read into the provisions
of the relevant sections a requirement of giving a reasonable opportunity of being heard
before an order is made which would have adverse civil consequences for the parties affected
as in case of C.B. Gautam v. Union of India143 . However, there are certain exceptions to
this general rule where the requirement of 'natural justice' is exc1uded. Such exceptional
circumstances are as follows: - Exclusion by Statutory Provisions The principle of natural
justice may be excluded by the statutory provisions where the statute expressly provides for
the -------------------------------------------------------------------------------------- 143. (1993) 1
S.C.C. 78 67 observance of the principles of natural justice, the provision is treated as
mandatory and the authority is bound by it. Thus, where the statute is silence as to the
observance of the principles of natural justice, such silence is taken to imply the observance
thereto and the Courts read into the provisions of the statute the observance of principles of
natural justice. However, the principles of natural justice are not incapable of exclusion.
These principles supplement law and they do not supplant the law and they may be excluded
by the statute. When the statute expressly or by necessary implication excludes the
application of the principles of natural justice, the Courts do not ignore the mandate of the
legislature or the statutory authority and cannot read into the concerned provisions of the
principles of natural justice as in case of A.K. Kraipak v. Union of India144. Whether the
exercise of a power conferred should be made in accordance with any of the principles of
natural justice or not depends upon the express words of the provisions conferring the power,
the nature of power conferred, the purpose for which it is conferred and the effect of the
exercise of that power as in case of Rash Lal Yadav v. State of Bihar145 and Umrao Singh
Chaudhary v. State of M.P.146
---------------------------------------------------------------------------------------- 144. A.I.R. 1970
S.C. 150 145. (1994) 5 S.C.C. 267 146. (1994) 4 S.C.C. 328 68 It is also be noted that
statutory provisions excluding the application of the principle of natural justice must not be
violative of the Constitutional provisions as in case of Gullapalli Nageshwar Rao v. A.P.
State Road Transport Corporation147 . The exclusion should be based on reasonable ground
and should not be arbitrary. If the exclusion is without any reasonable ground, it would be
certainly arbitrary and violative of Article 14 of Constituion of India as in the case of Delhi
Transport Corporation v. D.T.C. Majdoor Congress148 where the validity of Regulation 9(b)
of the Delhi Road Transport Authority (conditions of Appointment and Service) regulations
were challenged on the ground that this Regulation empowered the authority to terminate the
services of the permanent and confirmed employee by issuing a notice without assigning any
reason in the order and without giving any opportunity of hearing to the employee before
passing the order for termination of services. This regulation was held to be wholly arbitrary,
uncanalised and unrestricted violating the principles of natural justice as well as Article 14 of
the Constitution. Public Corporation or Govt. Company being state instrumentation are state
within the meaning of Article 12 of
--------------------------------------------------------------------------------------- 147. A.I.R. 1959
S.C. 1376 148. A.I.R.1991 S.C. 101 69 the Constitution and as such they are subject to the
observance of the fundamental rights embodied in Part-III of the Constitution as well as to
confirm to the Directive Principle in Part-IV of the Constitution. The Service Regulations or
rules framed by them are to be tested by the touchstone of Article 14 of the Constitution but
the procedure prescribed by their Rules or Regulations must be reasonable, fair and just and
not arbitrary, fanciful and unjust. In this case Justice Ray has observed that it is now well
settled that audi alteram partem which in essence enforces the equality clause in Article 14 is
applicable not only to the judicial and quasi judicial orders but also to the administrative
order affecting prejudicially the party in question, when the application of the rules has been
expressly excluded by the Act or Regulation or Rule. Exclusion by the Constitutional
Provisions The principles of natural justice may be excluded by the express provision of the
Constitution which are implicit in Article 14 & 21 and they are impliedly included therein.
Consequently, express Constitutional provisions excluding the application of the principles of
natural justice will prevail and here Article 311 (2) is notable. Article 311 provides protection
to the civil servants and Article 310 incorporates the doctrine of pleasure developed and
applied in England and the rule is that a civil servant of the Crown holds office during the
pleasure of the Crown and his services can be terminated by the Crown without assigning any
70 reason at any time and without giving any compensation except where it is otherwise
provided by a statute. The Crown is not bound by the contract of employment between it and
a civil servant. The doctrine of pleasure is based on public policy and its operation can be
modified by an Act of Parliament. Article 310 of the Constitution of India which incorporates
the doctrine of pleasure is subject to Article 311 and the protection of Article 311 is available
to all persons holding a civil post under the Union or a State Govt. including the members an
All India Services. However, the protection of Article 311 is not available to the members of
the Defence services or persons holding a civil post connected with defence outside the
regular civil services. Article 311 (1) According to Article 311 (1) no person who is a
member of a civil service of the Union or an All India Service or a Civil Service of a State
hold a civil post under the Union or a State shall be dismissed or removed by an authority
subordinate to that by which he has been appointed. Article 311 (2) According to Article 311
(2) no person holding a civil post under the Union or a State including the members of an All
India Service shall be dismissed or removed or reduced in rank except after an inquiry in
which he has been informed of the charges against him and given a 71 reasonable opportunity
of being heard in respect of these charges. The dismissal or removal or reduction in rank must
be by way of punishment which is determined by applying the test - (a) whether the
government servant has right to the post or rank -(b) Whether he has been visited with civil
consequences as in the case of Moti Ram Dcka v. N.E. Frontier Railway149 . If either of
these two tests is satisfied, the dismissal or removal or reduction in rank will be by way of
punishment so as to attract Article 311 (2) and the dismissal or removal or reduction in rank
without giving the reasonable opportunity of being heard will be unconstitutional and
arbitrary. The permanent servant has a right to hold the post and, therefore, his removal or
dismissal or reduction in rank without giving him reasonable opportunity to defend will be
unconstitutional as in the above case of Moti Ram Deka v. N.E. Frontier Railway149 .
However, a temporary govt. servant has no right to hold the post and, therefore, he may be
dismissed or removed from service at any time by giving a reasonable notice. If the order of
termination or reversion or reduction in rank costs stigma on the character or integrity of the
govt. servant, it will be constitute a penal consequence so as to attract
-------------------------------------------------------------------------------------- 149. A.I.R. 1964
S.C. 600 72 Article 311 (2) and hence, search order is required to be passed after inquiry and
giving him reasonable opportunity to defend. Second Proviso to Article 311 (2) Second
Proviso to Article 311 (2) create some exceptions to the rule of audi aIteram partem.
According to the proviso the aforesaid provisions of Article 311 (2) are not applicable in the
following conditions- (a) Where a person is dismissed or removed or reduced in rank on the
ground of conduct which has led his conviction on a criminal charge or (b) Where an
authority empowered to dismiss or remove a person or to reduce him in rank is satisfied that
for some reason to be recorded by that authority in writing, it is not reasonably practicable to
hold such inquiry or (c) Where the President or Governor as the case may be, satisfied that in
the interest of the security of the State, it is not expedient to hold such inquiry. In none of
these conditions there is any need to hold any inquiry or to provide the servant reasonable
opportunity of being heard. In the case of Tulsi Ram Patel v. Union of India150 the Supreme
Court has held that in these three conditions there is no need to hold an inquiry or to give
reasonable opportunity of being heard or even
----------------------------------------------------------------------------------- 150. A.I.R. 1985 S.C.
1416 73 the service rule cannot confer on the servant the right of hearing in the aforesaid
three conditions because the rule making power under Article 309 is subject to Article 311
and hence any rule contravening Article 311 would be invalid. In this case the Supreme Court
has made it clear that Article 14 cannot be invoked to imply natural justice in the three
clauses stated above and any action taken against the servant would be taken as malafide and
invalid. In the case of D.T.C. v. D.T.C. Mazdoor Congress151 the Supreme Court has held
that absence of arbitrariness is the first essential of the rule of law which means that decision
should be made by the application of known principles and rules and such decision should be
predictable and the citizen should know where he is. If a decision is taken without any rule, it
is unpredictable and such a decision is the anti-thesis of a decision taken in accordance with
the rule of law. However, the rule of natural justice i.e. audi alteram partem rule while in
essence and enforces the equality clause in Article 14 is applicable not only to the quasi-
judicial orders but also to the administrative orders affecting prejudicially the party in
question, unless the application of the rule has been expressly excluded by the Act or
Regulation or Rule. The rule of law demands that it has to be observed both substantially and
procedurally. ----------------------------------------------------------------------------------- 151.
A.I.R. 1991 S.C. 101 74 In an another case of State of Haryana v. Piara Singh152 , the
Supreme has held that in service matter the Rule of Court is to ensure rule of and to see that
the executive acts fairly and gives fair deals to employee as required under Articles 14 & 16.
For example, if a Municipal corporation is established, the Govt. is not required to hear the
residents of the Municipal area before taking decision for its establishment because the
establishment of a Municipal Corporation is a legislative Act and the rule of natural justice
are not applicable to the legislative Act as in the case of Sundarjas Kanegala Bhatiyja v.
Collector, Thane153 According to De Smith154 , the legislative act is the creation and
promulgation of a general rule of conduct without reference to the particular case. In making
the subordinate or delegated legislation also no hearing is required to be given unless the
Enabling Act expressly provides for such hearing. Exclusion in case of Legislative Act The
legislative act or function includes making of rules and regulations i.e. the delegated or
subordinate legislation and it is well
------------------------------------------------------------------------------- 152. A.I.R. 1992 S.C. 2130
153. A.I.R. 1990 S.C. 261 154. De Smith, Judicial Review of Administrative Action, 4th
Edition, p.71 75 established that legislative function or legislative act is not subject to the
principles of natural justice. According to Paul Jackson155 a Minister or any other body in
making legislation is not subject to the rule of natural justice. For example, in the case of
powers derived from the Royal Prerogative, the courts may refuse to interfere on the ground
that the applicant has not been deprived of any legal right as in case of De Freitas v.
Benny156 the Privy Council held that a Minister could not be required to disclose the
evidence on which he based his advice on the exercise of the Royal Prerogative of Mercy
because "Mercy is not the subject of legal rights. It begins where legal rights end." Lord
Denning M.R. succinctly expressed this judicial attitude in R v. Secretary of State for the
Home Department, ex.p. Hosendall157, "The rules of natural justice have to be modified in
regard to foreigners here who themselves unwelcome and ought to be deported." H.W.R.
Wade in his book Administrative Law at page 482 has also stated that there is no to be heard
before the making of legislation, whether primary or deregative unless it is provided by the
statute. ----------------------------------------------------------------------------------------- 155. Paul
Jackson, Natural Justice, p.161 156. (1976) A.C. 238 157. (1977) W.L.R. 766, 778 76 In
MRF Ltd. v. Inspector, Kerala Gove158 the court has made it clear that the principle of
natural justice cannot be imported in matter of legislative action. If the legislative, in exercise
of its plenary power under Article 245 of the Constitution, proceeds to act in a law, those who
would be affected by that law cannot legally raise a grievance that before the law was made,
they should have given an opportunity of hearing. Union of India v. Cynamide India
Ltd.159 , Prag Ice & Oil Mills v. Union of India160 , C.L. Sahu v. Union of India161 and
J.K. Synthetic Ltd. v. Municipal Board of Nimbehe162 are the recent Indian cases where it
has been held that legislative function or act is not subject to the principle of natural justice
but if there is a provision in the statute requiring the observance of the rules of natural justice,
the provision must be complied with and thus in such condition the rules of natural justice
would be required to be observed. Exclusion in case of Public Interest The observance of the
principles of natural justice may be excluded in case such observance would cause injury to
the public ----------------------------------------------------------------------------------------- 158.
A.I.R. 1999 S.C. 188 159. A.I.R. 1987 S.C. 1802 160. A.I.R. 1987 S.C. 1768 161. A.I.R.
1990 S.C. 1490 162. A.I.R. 1991 Raj. 1 77 interest as in the case of Union of India v. Tulsi
Ram Patel163 the Supreme Court made it clear that "the rules of natural justice can be
avoided if its observance will paralyse the administrative process. The cases of public interest
include the defence of the country and maintenance of state secret and here the rule of natural
justice may be excluded or avoided keeping in view both of these interests. Thus the
authorities are not required to disclose the informations relating to the defence policy or
defence matter because such disclosure may seriously jeopardize the defence planning of the
Govt." In the case of Union of India v. Tulsi Ram Patel163 , a permanent auditor in the
Regional Audit Office, was convicted u/s 332 of the Indian Penal Code for causing head
injury by iron rod to his superior officer, R.A.O. He was compulsory retired by the
Disciplinary Authority under Rule 19(1) of the Central Civil Service (Classification, Control
and Appeal) Rules, 1965 without holding enquiry and giving opportunity of being heard
under Article 311 (2). The Supreme Court has held the order of compulsory retirement from
service was valid under clause (a) of second proviso to Article 311 (2).
----------------------------------------------------------------------------------------- 163. A.I.R.1985
S.C. 141 78 In one group of cases decided along with the case of Tulsi Ram Patel, some
members of C.I.S.F broke down the discipline in the Force and delebrately destroyed the
orders of the Superior. Military was called and there had been exchange of fire between
Military and member of C.I.S.F. for a few hours. Situation was very violent and there was
mass terror and threat to the loyal staff. The respondents who were members of the said
C.I.S.F. were dismissed from service without holding inquiry under clause (b) of the proviso
to Article 311(2) and Rule 37(b) of the C.I.S.F. Rules on the ground that it was reasonably
practicable to hold inquiry. The Supreme Court held the order of dismissal of the members of
the C.I.S.F. was valid under clause (b) to the second proviso to Article 311(2). Similarly in
another group of cases decided by the Supreme Court on the same grounds of Tulsi Ram
Patel case, the Railway Employees were dismissed from services under clause (b) of second
proviso to Article 311(2) and Rule 14 of the Railway Servant Rules for participating in the
illegal all India strike of the Railway Employees. The Railway service was paralysed, loyal
workers and superior officers were assaulted and intimated, public interest and public good
were prejudicially affected. There was a. great need for prompt and immediate action to bring
the situation to normal and in these circumstances the 79 inquiry was not reasonably
practicable. Hence the order of dismissal was held valid. In another group of cases decided
along with the case of Tulsi Ram Patel, the members of the M.P. Distt. Police and M.P.
Special Arm Forces stationed at annual Mela at Gwalior induldge in violent demonstration
and rioting, were dismissed from service by the order of Governor without making inquiry
and giving the petitioners a reasonable opportunity of being heard. The Supreme Court held
the order of dismissal was valid on the ground that in these circumstances prompt and urgent
action was required and, therefore, holding of the inquiry would not have been in the interest
of the security of the State. It is to be noted that public interest is a justiable issue as in case of
Maneka Gandhi v. Union of India164. The determination of the authority that the exclusion
of the rule of natural justice is in public interest and is not final, the Court may examine
whether the exclusion is necessary for the protection of the public interest. The Court can
very well determine whether the exclusion of the principle of natural justice is in public
interest or not. In this case, the Court has also held that in situation where prior hearing is
dispensed with on the ground of public interest, opportunity of personal hearing must be
given to the person ----------------------------------------------------------------------------------------
164. A.I.R. 1978 S.C. 597 80 concerned. If the public interest demands post decisional
hearing, then it must be brought in action and post-decisional hearing means hearing after the
decision or order. Exclusion in case of Emergency or Necessity The rule of natural justice
may be excluded where prompt action is required to be taken in the interest of public safety
or public morality or public health and in case of prompt action is required to be taken the
pre-decisional hearing may also be excluded. For example where a person who is dangerous
to peace in the society is required to be detained or externed as in case of Babu Lal v. State of
Maharashtra165 or where a building which is dangerous to the human lives is required to be
demolished as in case of Nathu Bhai v. Municipal Corporation Bombay166. A trade which is
dangerous to the society is required to be prohibited and a prompt action is required to be
taken in the interest of public and hearing before the action may delay the administrative
action and thereby cause injury to the public interest and public safety as in the case of
Cooverji v. Excise Commissioner167 . The administrative determination is thus subject to the
judicial review as in case of Swadeshi Cotton Mill v. Union of India168 where the Supreme
Court has held -----------------------------------------------------------------------------------------
165. A.I.R. 1961 S.C. 484 166. A.I.R. 1959 Bombay 333 167. 1954 S.C.R. 873 168. A.I.R.
1981 S.C. 818 81 that the word „immediate‟ in Section 18AA of the Industries Development
and Regulation Act does not imply that the rule of natural justice can be excluded. The audi
alteram rule is very flexible and adoptable concept of natural justice which can be modified
to adjust and harmonize to need for special and obligation to act fairly and thereby the
measure of its application may be cut short in reasonable proportion to the exigencies of the
situation. The doctrine of necessity has been well explained in Halsbury‟s Laws of England
where it has been stated that even if all the members of the Tribunal competent to determine a
matter were subject to disqualification, they might be authorized and obliged to hear that
matter by virtue of the operation of the common law doctrine of necessity which has been
recognized and applied by the Supreme Court of India in Charan Lal Sahu v. Union of
India169 and in case of Tata Cellular v. Union of India170 where the Supreme Court held
that the acceptance of the tender of the company in which his son was employee could not be
initiated merely because the said officer was a member of the Tender Evaluation Committee
who was not a decision-maker at all and his involvement was necessary in view of Sec. 3(6)
of the Telegraph Act.
---------------------------------------------------------------------------------------- 169. A.I.R. 1990
S.C. 1480. 170. A.I.R. 1996 S.C. 11 82 Thus, the Court held that the acceptance of the tender
could not be declared invalid on the ground of bias. Exclusion on the ground of impractibility
Where the authority deals with a large number of persons it is not practicable to give all of
them opportunity of being heard and, therefore, in such condition the Court does not insist on
the observance of the rules of justice as in case of R.Radhakrishnan v. Osmania
University171 where the entire M.B.A. Entrance Examination was cancelled on the ground of
mass copying and the Court held that it was not possible to give all the examinees the
opportunity of being heard before the cancellation of the examination. Similarly in another
case of Bihar School Examination Board v. Subhash Chandra172 the examination of all
subject at one centre was cancelled on the ground of mass copying and the examinees were
allowed to reappear at a supplementary examination. The Supreme Court held that the
number of examinees was very large and it was impracticable to give all of them opportunity
of being heard before passing the order. Exclusion in case of Confidentiality Some times the
rule of natural justice is excluded in case of
---------------------------------------------------------------------------------------- 171. A.I.R. 1974
A.P. 283 172. A.I.R. 1970 S.C. 1269 83 confidentiality as in case of Malak Singh v. State of
Punjab173 where the Surveillance Register maintain by the police is a secret and confidential
document and no one can claim access to it despite his name has been entered in the registrar.
The observance of the rule of natural justice in such a case would defeat the purpose of
surveillance and there is every possibility of the end of justice being defeated instead of being
served. Exclusion in case of Academic Adjudication In the case of Jawahar Lal Nehru
University v. B.S. Narwal174 the Supreme Court has held that the very nature of academic
adjudication appears to negative any right of hearing where a student of the university was
removed from the Roll on the ground of unsatisfactory academic performance without giving
him any opportunity of hearing. The Supreme Court has made it clear that if the competent
academic authority assess the work of a student over a period of time and thereafter declare
his work unsatisfactory the rule of natural justice may be excluded and it is to be noted here
that this exclusion does not apply in case of disciplinary matters.
----------------------------------------------------------------------------------------- 173. A.I.R. 1981
S.C. 760 174. A.I.R. 1980 S.C. 1666 84 Exclusion when no right of the person is infringed In
case where the right of a person is not prejudicially affected, the application of the rules of
natural justice is not attractive as in case of J.R. Vohra v. Indian Export House Ltd. 175
where under the Delhi Rent Control Act limited tenancy can be created and it can be
terminated on the expiry of its term. If the term of the limited tenancy is expired and warrant
of position is issued to the tenant without any notice of hearing to him, the warrant of position
cannot be held to be invalid on the ground that no hearing has been given to the tenant before
the issue of the said warrant and by the issue of the said warrant no right has been violated
and as a result the application of the rules of natural justice is not attracted. Exclusion in the
case of interim preventive action The rules of natural justice is not attracted in the case of
interim preventive order. For example in a case of Abhay Kumar v. K.Srinivasan176 an order
was passed by the College Authority debarring the student from entering the premises of the
college and attending the classes till the pendency of a criminal case against him for stabbing
a student and the Court held that the order was interim and not final and
----------------------------------------------------------------------------------------- 175. A.I.R. 1985
S.C. 475 176. A.I.R. 1981 Delhi 381 85 it was passed with the object of maintaining peace in
the campus being preventive in nature and the rules of natural justice were not applicable in
the case of such order. Exclusion in case of fraud The rules of natural justice are not
applicable and excluded in case of fraud as in case of U.P. Junior Doctors Action Committee
v. Dr. B.Sheetal Nandwani177 where the admission obtained by fraud was cancelled without
providing opportunity of hearing to the affecting candidates and the Supreme Court held that
the circumstances in which such benefit has been taken by the candidates concerned do not
justify the attraction of the application of the rule of natural justice and, therefore, the
cancellation of the admission could not be challenged on the ground of not providing the
opportunity of hearing to the affected candidates before passing the order of cancellation of
admission. The Supreme Court in this case made it quite clear that opportunity of hearing is
not necessary before passing the order of canceling the admission of the candidates when
such admission has been secured by fraud. Effect of Breach of Natural .Justice When the
Authority is required to observe the principle of natural justice in passing an order but fails to
do so, the general judicial
----------------------------------------------------------------------------------------- 177. A.I.R. 1991
S.C. 909 86 opinion is that the order is void. For example in case of Ridge v. Baldwin178 in
England the Court held the decision of the authority void on the ground of the breach of rule
of fair hearing. However, in case of Durayappah v. Fernando179, the order passed without
observing the principle of natural justice was held to be voidable and not void and the
decision in this case has been much criticised. Griffith and Street have expressed the view
that the failure to give a hearing renders a decision void and not merely voidable and the
contrary decision in Durayappah case cannot be regarded as a good English Law180 In India,
the position is well settled and the order passed in violation of the principles of natural justice
is void as in the cases of Nawab Khan v. State of Gujrat181, State of U.P. v. Mohd.
Noor182 , A.K. Kraipaipak v. Union of India183 and Collector of Monghyr v. Keshav Pd.184
When the reasons for the decision are not given to the person concerned or reasons are not
given to the Court, the order is quashed and
----------------------------------------------------------------------------------------- 178. (1964) A.C.
40 179. (1967) 2 A.C. 337 180. Griffith & Street, Principle of Administrative Law, p. 115,
231 (1973) 181. A.I.R. 1974 S.C. 147 182. A.I.R. 1958 S.C. 87 183. A.I.R. 1970 S.C. 150
184. A.I.R. 1962 S.C. 1674 87 the authority is directed by the Court to examine the matter
afresh as in case of Bhagat Raja v. Union of India185 and in case of Travancore Rayons v.
Union of India186. When the reasons are not communicated to the person concerned that
they are on record and in some cases as in Ahmedabad Municipality v. Raman Lal187 and in
I.M.A. Industries v. Union of India188, the court has upheld the action but in some other
cases as in Ajantha Industries v. Central Board of Direct Taxes189 the court has not upheld it
because the court has held that recording of reasons on the file is not sufficient and it is
necessary to give reasons to the affected person and in this case the order was quashed on the
ground that the reasons were not communicated to the person concerned. The view expressed
in this case appears to be the better view and reasons are always to the benefit of the party
concerned and they should be communicated to the person concerned and they should not be
confined to the record or file. 5. RECENT DECIDED CASES IN APEX COURTS OF
INDIA Following are the recent decided cases of Hon‟ble High Court as well as Supreme
Court in which Principle of Natural Justice is involved:-
----------------------------------------------------------------------------------------- 185. A.I.R. 1967
S.C. 1606 186. A.I.R. 1971 S.C. 862 187. A.I.R. 1975 S.C. 1287 188. A.I.R. 1980 Delhi 200
189. A.I.R. 1976 S.C. 437 88 Lachhman Singh Chopra v. State Bank of India190 .
Departmental Inquiry was conducted and the petitioner was dismissed from service.
Wednesbury principle that Punishment whether disproportionate and Petitioner appellant
found guilty by Inquiry Officer of the misconduct for accepting bribe for sanctioning loan to
farmers. Disciplinary Authority the basis of Inquiry Report dismissed the petitioner /
appellant from service. Appeals before appellate and revisional authorities, failed that Writ
petition filed by petitioner / appellant before High Court also dismissed by Single Judge.
Appeal against the above order held that, principle of natural justice have religiously been
complied with by the punishing, appellate and revisional authorities. Wednesbury principle
would not be attracted. It is for the Disciplinary Authority to decide the quantum of
punishment. Charges leveled against the petitioner / appellant were serious in nature and
stood proved. No interference of Courts, warranted. Order and judgment passed by Single
Judge, upheld. 2007 (1) RSJ 45, 2001 (1) S.C.T. 214 and 2006 (2) S.C.T. 219, relied. 2011
(1) S.C.T. 249, Distinguished. Panchmahal Vadodara Gramin Bank v. D.M. Parmar191
Disciplinary proceedings. Dismissal from service. The Petitioner was
------------------------------------------------------------------------------------- 190. 2011(4) SCT 353
(P&H)(D.B.) 191. 2011(4) SCT 725(SC) 89 dismissed from Service. Proportionality and
validity of Reasonable opportunity of hearing, whether not given to delinquent in the Enquiry
Proceedings held that documents called by delinquent during enquiry has been found by
Enquiry Officer as not relevant for the charges against delinquent. If the said documents were
not allowed to be inspected by delinquent Officer, there has been no violation of principles of
natural justice. Charges against him were of serious nature which were largely proved.
Findings of Enquiry Officer include not only serious acts of negligence by delinquent but also
acts of dishonesty and lack of probity. Punishment of dismissal from service was not
shockingly or strikingly disproportionate to gravity of charges, 1996 (2) SCT 760, (2005)4
SCC 364 and 2010(4) SCT 120, relied upon 2006(2) SCT 446, 2009(1) SCT 563 and (2003)9
SCC 480, distinguished. State of Tripura v. Puranjoy Nath192 Cancellation of Appointment
after 17 years. Petition filed against the above order in the double bench of Gauhati / Agartala
bench and held that Petitioners duly participated in selection process and a merit list was also
prepared. Appointments cancelled after 17 years. Petitioners were not even informed, by
issuing any appropriate notice, regarding
---------------------------------------------------------------------------------- 192. 2012(1) SCT 41
(Gauhati) (Agratala Bench)(D.B.) 90 remiss committed by them or illegality that occurred in
their appointments, warranting termination of their services. Apart from an omnibus
statement of vague allegation of selection process itself being void, there was no material or
particulars mentioned in impugned memorandum justifying cancellation of appointments.
Principles of natural justice violated. Order directing reinstatement without any backwages
upheld and appeals dismissed. Gupta and Gupta Chartered Accountants v. Reserve Bank of
India193 . This case Writ Petition No. 10672 of 2009 decided on 10.10.2011 in Delhi High
Court where Gupta & Gupta Chartered Accountants were petitioners and Reserve Bank of
India and others were respondents. Mr. H.S. Parihar, Advocate appeared for respondent No. 1
and Sh. Jagdeep Kishore, Advocate appeared for respondent No. 2 and 3. Banking companies
(Acquisition of Transfer of undertakings) Act, 1970. Appointment and Removal of SCA.
Petitioner a firm of charted accountants excluded from panel of Statutory Central Auditors
for a public sector Bank. Discontinuance on account of complaint made to RBI against
petitioner by PNB which was accepted and acted upon by RBI. RBI accepted complaint by
PNB without seeking explanation
---------------------------------------------------------------------------------- 193. 2012(1) SCT 571
(Delhi). 91 from petitioner on PNB's specific allegations. RBI as a holder of power to appoint
and remove an SCA has to exercise such power in a fair and reasonable manner after
following a just procedure which comports with principles of natural justice. Allegations
concerning competence and integrity of an SCA selected by RBI through a fairly rigorous
process cannot be permitted to be made lightly and equally accepted on face value without
some probe by RBI. Decision of RBI held to be violative of principles of natural justice and
was therefore, illegal. Said decision of RBI will not come in way of Petitioner being hereafter
appointed SCA in accordance with norms devised by RBI. Sanjay Kumar Singh v. Union of
India194 . Central Reserve Police Force Rules, 1955. Rule 27 (c). The above case was heard
in Hon‟ble Supreme Court of India before Justice Mukundakam Sharma and Anil R. Dave in
Civil Appeal No. 4888, 4885, 4886 and 4887 of 2005 and the case was decided on
06.09.2011. Appellants were detailed to go in two vehicles one as escort and other a water
tanker for bringing water. While both the vehicles were on their way to the water point
Militants ambushed the vehicles and started firing indiscriminately. Five CRPF Personnel in
the escort vehicle were killed. Appellants were the four who survived the ambush. Appellants
suspended from service for committing
------------------------------------------------------------------------------------- 194. 2012(1) SCT
184(SC). 92 disobedience of orders, gross misconduct and dis- playing cowardice in
execution of their duties and in their capacity as members of CRPF. No violation of
principles of natural justice as alleged by counsel of appellants. Reasonable opportunity
granted to appellants at every stage. Drivers of both the vehicles did not carry arms as per
hand book of CRPF. Charge sheet issued to appellants much before seven days as required to
be done prior to holding of the trial. Therefore no prejudice caused to the appellants because
one of the witness was examined in trial before expiry of 48 hours after reading out the
charges to them, in view of the fact that they were made aware of contents of charges much
prior. List of witnesses making it clear that there could be any other witness other than those
cited specifically in the list. Appellants specifically did not opt for Defence Assistant and in
fact cross examined the witnesses themselves. No violation of principles of natural justice.
Punishment awarded not disproportionate to the offences alleged. Therefore findings by
Benches of High Court cannot be interfered with lightly. In the present case two benches of
the High Court after looking into the records have found that there is no violation of the
principles of natural justice and that the charges have been established against all the
appellants and that the punishment awarded is not disproportionate to the offences alleged.
After the said findings have been recorded by the learned Single Judge and the 93 Division
Bench, there is hardly any scope for this Court to substitute its findings and come to a
different conclusion, by reappreciating the evidence. The findings recorded by the Benches of
the High Court are concurrent findings and the same cannot be interfered with lightly. In our
considered opinion, to re-appreciate the evidence and to come to a different finding would be
beyond the scope of Article 136 of the Constitution of India. Therefore, we hold that the
judgment and order passed by the High Court suffers from no infirmity. Accordingly, the
appeals have no merit and are dismissed but without any order as to costs. Appeal dismissed.
1994(1) S. C. T. 319: 2010(2) S.C.T. 628, relied on. S.C. Sharma v. Central Administrative
Tribunal, Chandigarh Bench, Chandigarh195 . The above case CWP No. 8197-CAT of 2011
decided on 16.05.2011 was heard in the Hon‟ble Punjab and Haryana High Court D.B. of
Justice M.M. Kumar and Justice Jitender Chauhan. Article 311 and 226- Dismissal from
service.Proportionality of punishment challenged and held that Courts are not a Court of
Appeal over and above the Enquiry Officer, Disciplinary Authority or the Appellate /
Revisional Authority. If the Enquiry Officer, Punishing Authority or the Appellate Authority
has proceeded on the basis of wholly irrelevant
------------------------------------------------------------------------------------ 195. 2012(1) SCT
683(P&H)(D.B.). 94 consideration or in violation of principles of natural justice only then the
Courts are empowered to interfere with the quantum of punishment imposed. When the
principles laid down in the aforementioned judgments are applied to the facts of the present
case, we find that the Wednesbury principles, as per the guidelines given in Rameshwar
Prasads case (supra) would not be attracted because principles of natural justice have been
religiously complied with. Therefore, the impugned orders passed by the punishing, appellate
and revisional authorities would not require any intervention. For the reasons
aforementioned, we find no merit in the instant petition. Accordingly, the same is dismissed.
Harbans Lal v. Bank of India196 This case was heard before Justice M.M. Kumar and Justice
Arvind Kumar in L.P.A. No. 1663 of 2010 (O&M) decided on 04.08.2011 in which Shri H.C.
Arora, Advocate appeared on behalf of Sh. Harbans Lal, Appellant and Sh. K.P.S. Dhillon,
Advocate appeared on behalf of respondents. The petitioner was dismissed from service on
the basis of embezzlement and misappropriation. Copy of inquiry report not served on the
appellant and categorical Confession alongwith admission of guilt by dismissed employee
who is appellant. Finding of
------------------------------------------------------------------------------------- 196. 2012(1) SCT 216
(P&H)(D.B.). 95 Departmental enquiry well based and supported by evidence in addition to
confessional statement. Appellant found guilty of embezzlement after holding an inquiry in
accordance with procedure laid down in the Rules. Principles of Natural Justice followed at
the stage of holding of enquiry. Appellant was also granted personal hearing. Merely because
a copy of inquiry report not sent to the appellant would not vitiate the proceedings. No
prejudice for nonsupply of inquiry report has been suffered by appellant particularly when he
himself has confessed the acts of issuance of bogus receipts and misappropriation. Appeal
dismissed. 1991(1) SCT 111 : 1994(1) SCT 319, relied on. A and N Islands Integrated Devp.
Corp. Ltd. v. Regional Provident Fund Commissioner197 Employees Provident Funds and
Miscellaneous Provisions Act, 1952, Section 7-1. The above case was heard in the Hon‟ble
Calcutta High Court in Writ Petition No. 1160 of 2010 decided on 25.01.2011 before Justice
Sanib Banerjee in which A and N Islands Integrated Devp. Corp. Ltd. was petitioners and
Ms. Anjili Nag, Advocate appeared for petitioners and S.Karmakar, Advocate appeared for
the respondents. Alternative remedy. Provident Fund authorities applied the provisions of
CPWD Manual in relation to the first writ petitioner
------------------------------------------------------------------------------------- 197. 2012(1) SCT
124(Calcutta). 96 without making him aware thereof and Principles of natural justice
apparently violated. Existence of alternative remedy held, was no bar in such case. Matter
directed to be reconsidered by authority after giving hearing to the petitioner. However, it is
made clear that the merits of the order have not been gone into and it will be open to the
appropriate authority to pass the same order, if found suitable, after hearing the petitioners on
the applicability of the CPWD Manual to the first petitioner. W.P. No. 1160 of 2010 is
allowed accordingly without any order as to costs. Petition was allowed by the Hon‟ble
Court. Madhukar Tulsiram Tayade v. Chairman Board of Directors, Vidarbha Kshetriya
Gramin Bank, Akola198 The above Writ Petition No. 341 of 2011 was decided on
15.03.2011 was heard in the Bombay High Court (D.B.) before Justice D.D. Sinha and
Justice A.P. Bhangale in which petitioner was represented by M.M. Sudame, Advocate and
the respondents were represented by N.W. Almelkar, Advocate. Removal from Service – No
opportunity of hearing afforded to petitioner by appellate authority by appellate authority and
also no reasons given for confirming punishment awarded by disciplinary authority. It was
held that the order suffers from non-application of mind and is violative of principles of
natural ------------------------------------------------------------------------------------ 198. 2012(1)
SCT 79 (Bombay)(D.B.). 97 justice. Hence, we have no hesitation in holding that the
impugned order suffers from non-application of mind and is violative of principles of natural
justice and, therefore, cannot be sustained in law. For the reasons stated hereinabove, the
impugned order dated November, 29, 2010 passed by the Board of Directors is hereby
quashed and set aside. It is open for the respondents to reconsider the appeal and to take a
decision by following the principles of natural justice, within a period of three months, by
passing a reasoned order. Rule is made absolute in above terms and no order as to cost.
Chhayaben Sureshchandra Arya v. State of Gujarat199 This case of Special Civil Application
No. 504 of 2011 decided on 31.01.2011 before Justice Abhilasha Kumari in which Sh. P.H.
Pathak, Advocate appeared for the petitioner and Sh. K.P. Rawal, Advocate and Govt.
pleader appeared for the respondents State of Gujarat & others. Constitution of India Article
16 Transfer of service and repeated transfers challenged on the allegation of malafides. The
Hon‟ble High Court had directed Secretary, Health and Medical Services to decide
representation of petitioner against order of transfer taking into consideration allegations of
malafides and pass reasoned order.Representation of petitioner however rejected by
Commissioner, ------------------------------------------------------------------------------------ 199.
2012(1) SCT 58 (Gujarat). 98 Commissionerate of Medical Services and not by Secretary,
Health and Medical Services who was so directed did not decide allegations of malafides. No
reasoned order passed. Hence, order rejecting representation liable to be set aside. Balbir
Singh Analyst v. State of Haryana200 Articles 14 and 16 – Retrospective Promotion and
Petitioner joined on the post of Analyst on 6.5.1986 by direct recruitment. While respondent
No. 3 who was working on the junior post as Senior Analytical Assistant was subsequently
promoted to post of Analyst on 17.12.1986. He remained junior to petitioner and official
respondents suddenly gave retrospective promotion to Respondent No. 3 with effect from
30.10.1984 thus rendering the petitioner junior to him without issuing any notice or providing
opportunity of being heard to petitioner. Doctrine of audi alteram partem and rules of natural
justice completely violated by Respondents. No other cogent evidence on record even to
suggest remotely that any post of promotional quota in the cadre of Analyst was vacant in the
year 1982 as pleaded by respondents. No cogent explanation for the coming that why
respondent No. 3 was not promoted with effect from 1982 and why he was subsequently
promoted with effect from 30.10.1984. Thus,
------------------------------------------------------------------------------------- 200. 2011(3) SCT
336(P&H). 99 Respondent No. 3 cannot legally be granted retrospective promotion over and
above the petitioner who had joined by direct recruitment when respondent No. 3 was not
even born in the indicated cadre. Promotional order being illegal, arbitrary and against the
principles of natural justice cannot legally be maintained thus set aside. 2010(3) SCT 343 :
1991 SCC (L&S) 1070, relied on. Justice P.D. Dinakaran v. Hon‟ble Judges Inquiry
Committee201 Articles 14, 121 and 124 – Judges (Inquiry) Act, 1968, Sections 3(2)(c) –
Natural Justice and an enquiry committee was constituted. Apprehension of bias in the mind
of delinquent because of inclusion of a person as a member of the committee with a
prejudiced mind. The member alleged to be biased had participated in the seminar organized
by the Bar Association of India and made speech opposing elevation of the petitioner as
Judge of Supreme Court and drafted the resolution against him. It was held that the natural
justice is a branch of public law and Principles of natural justice control all actions of public
authorities by applying rules relating to reasonableness, good faith and justice, equity and
good conscience. Natural justice is a part of law which relates to administration of justice. It
requires that justice should not only be done, but must be seen to be done.
------------------------------------------------------------------------------------- 201. 2011(3) SCT 704
(SC). 100 Apprehension of bias has to be seen from the view point of the delinquent not from
the angle of the court. Therefore, fairness and interest of justice requires that such a member
should be replaced from the enquiry committee. Competent authority from quested to replace
the said member of the committee without interfering with the proceedings already taken up
by the committee. Ombir Singh v. Union of India202 Articles 14, 16 and 311 – Punjab
Prisons State Service (Class-III) Executive Rules, 1963, Rule 15 – Punjab Civil Services
(Punishment and Appeal) Rules, 1970, Rule 8 – Punjab Jails Department Executive
(Punishment and Appeal) Rules, 1948, Rule 10. Public Servant found guilty of Misconduct
and Departmental Inquiry was held where the petitioner was removal from service.
Justification of Petitioner served with a charge sheet on basis of misconduct committed by
him. Inquiry Officer submitted his report to the Disciplinary Authority and Dissatisfied with
the reply given by the petitioner, the Disciplinary Authority removed him from service.
Appeal and revision filed by petitioner were dismissed. Original application filed by
petitioner before Central Administrative Tribunal, also failed. Writ against – Held, that once
no procedural lapse has been pointed out, the findings
------------------------------------------------------------------------------------ 202. 2011(3) SCT
777(P&H)(D.B.). 101 of Enquiry Officer are based on evidence and charges have been
established. Tribunals and Courts are not a Court of Appeal over and above the Inquiry
Officer, Disciplinary Authority or Appellate / Revisional Authority. Plea of petitioner that he
had been acquitted in the criminal case and there was no legal warrant to hold departmental
inquiry, is not acceptable. Inquiry proceedings and criminal proceedings could be conducted
even simultaneously. Acquittal in criminal proceedings does not bar the departmental
proceedings. No violation of principles of natural justice or the petitioner has been treated
unfairly. Once the findings of Inquiry Officer are well based and procedural requirements as
contemplated by Rules, have been complied with, quantum of punishment cannot be
interfered with order of removal of service of petitioner, upheld. (2004) 7 SCC 442; (2005)
10 SCC 471; (1991) 4 SCC 385; (1999) 2 SCT 660 and 2007 (1) RSJ 45, relied upon.

_ __
1
PRINCIPLES OF NATURAL JUSTICE
Lecture delivered by Justice T.S.Sivagnanam
at Tamil Nadu State Judicial Academy on 01.06.2009
to the newly recruited Civil Judges (JR Division) during Induction Programme 2009
All of you who have assembled here have been newly Inducted in to the Judicial
Family. There lies an onerous responsibility on each one of you to carry forward your
office with dignity and decorum. The post of Civil Judge Junior Division is the foundationof
our Judicial Structure. It is common knowledge that unless the foundation is strongand firm,
one cannot raise a tall edifice on it. The Subordinate Judiciary is the root of our Judicial
system and each one of you should strive hard to inspire confidence in the society that they
would get Justice. With these words let me proceed to the topic for the
day. The Judicial Academy has classified the subject allotted under the head – General
Topics. Though I may not strictly agree with such classification, it is to be noted that though
the topic would appear to be general in nature, its roots are deeply embedded and its forms
the basis for administration of Justice which is so essential to preserve social order and
security.
I am aware of the nature of litigation which would be assigned to a Civil Judge Junior
Division and it is all the more essential that all of you observe the principle in both your
Judicial as well as your Administrative work.
For the sake of convenience I propose to analyze the topic – Principle of Natural Justice
under the following heads.
1. The Principle and its essential elements
2. How the name came ?
3. How it developed over the years ?
4. How and where it has to be applied ?
1. The Principle and essential elements of Natural Justice:
In a famous English decision in Abbott vs. Sullivan reported in (1952) 1 K.B.189
at 195 it is stated that “the Principles of Natural Justice are easy to proclaim, but their precise
extent is far less easy to define”. It has been stated that there is no single definition of Natural
Justice and it is only possible to enumerate with some certainty the main principles. During
the earlier days the expression natural Justice was often used with the expression natural
Law, but in the recent times a restricted meaning has been given to describe certain rules of
Judicial Procedure. There are several decision of the Hon’ble Supreme Court which I shall
refer at the appropriate place and these Judgments are sufficient to summarize and explain the
two essential elements of Natural Justice namely
a. No man shall be Judge in his own cause
b. Both sides shall be heard, or audi alteram partem
The other principles which have been stated to constitute elements of Natural Justice are
i. The parties to a proceedings must have due notice of when the Court / Tribunal will
proceed
ii. The Court / Tribunal must act honestly and impartially and not under the dictation of other
persons to whom authority is not given by Law
These two elements are extensions or refinements of the two main principles stated above.
2. How the expression Natural Justice came ?
We have seen the essential elements of Natural Justice and its extensions or
refinements. In Maclean vs. The Workers Union (1929) 1 Ch. 602, 624 it has been
stated as follows.
3
“The phrase is, of course, used only in a popular sense and must not be taken to mean that
there is any justice natural among men. Among most savages there is no such
thing as Justice in the modern sense. In ancient days a person wronged executed his
own justice. Amongst our own ancestors, down to the thirteenth century, manifest
felony, such as that of a manslayer taken with his weapon, or a thief with the stolen
goods, might be punished by summary execution without any form of trial. Again, every
student has heard of compurgation and of ordeal; and it is hardly necessary to observe
that (for example) a system of ordeal by water in which sinking was the sign of
innocence and floating the sign of guilt, a system which lasted in this country for
hundreds of years, has little to do with modern ideas of justice. It is unnecessary to give
further illustrations. The truth is that justice is a very elaborate conception, the
growth of many centuries of civilization; and even now the conception differs
widely in countries usually described as civilized”.
Natural Justice has been defined in various cases and a few instances are given
below.In Drew V. Drew and Lebura (1855 (2) Macg. 1.8, Lord Cranworth defined it as
“universal Justice”.
In James Dunber Smith v. Her Majesty the Queen (1877-78 (3) App Case 614,
623 JC) Sir Robort P.Collier, Speaking for the Judicial Committee of Privy
Council, used the phrase ‘the requirements of substantial justice’.
In Arthur John Specman v. Plumstead District Board of Works (1884-85 (10) App
Case 229, 240), Earl of Selbourne, S.C. preferred the phrase ‘the substantial
requirement of justice’.
In Vionet v. Barrett (1885 (55) LJRD 39, 41), Lord Esher, MR defined natural
justice as ‘the natural sense of what is right and wrong’.
While however, deciding Hookings vs. Smethwick Local Board of Health (1890
(24) QBD 712), Lord Fasher, M.R. instead of using the definition given earlier by
him in Vionet’s case (supra) chose to define natural justice as ‘fundamental
justice’.
4
In Ridge v. Baldwin (1963 (1) WB 569, 578), Harman LJ, in the Court of appeal
countered natural justice with ‘fair play in action’ a phrase favoured by
Bhagawati, J. in Meneka Gandhi vs. Union of India (1978 92) SCR 621).
In Re R.N. (An Infaot) (1967 (2) B. 617, 530P, Lord Parker, C.J., preferred to
describe natural justice as ‘a duty to act fairly’.
In Fairmount Investments Ltd., vs. Secretary to State for Environment (1976
WLR 1255) Lord Russell of Willowan somewhat picturesquely, described natural
justice as ‘a fair crack of the whip’
Geoffrey Lane, LJ in Regina vs. Secretary of State for Home Affairs Ex Parte
Hosenball (1977 (1) WLR 766) preferred the homely phrase ‘common fairness’.
3. How the Principles of Natural Justice developed over the years ?
The two essential elements had been stated of which the first being that no man shall
be Judge in his own cause.
Judges, like Caesar’s wife, should be above suspicion. The Principle is not confined
merely to the case where the Judge is an actual party to a cause, but applies to a cause
in which he has an interest. An “Interest”, has been defined as a legal interest or a
pecuniary interest and is to be distinguished from “favour”. Such an interest will
disqualify a Judge. The interest (or bias) which disqualifies must be one in the matter to
be litigated. A mere general interest in the general object to be pursued will not
disqualify a magistrate. The interest or bias which disqualifies is an interest in the
particular case, something reasonably likely to bias or influence the minds of the
magistrates in the particular case. The Law in laying down this strict rule has regard, not
to the motive which might bias the Judge but it is to promote the feeling of confidence in
the administration of Justice. As the famous saying goes – Justice should not only be
done but should manifestly and undoubtedly be seem to be done.
The second principle - Audi Alteram Partem – as the maxim denotes that no one should
be condemned unheard. This principle could be broadly classified as under.
i. party to an action is prima facie entitled to be heard in his presence
ii. he is entitled to dispute his opponent’s case, cross examine his opponents
5
witnesses and entitled to call his own witnesses and give his own evidence
before Court.
iii. He is entitled to know the reasons for the decision rendered by a Court /
Tribunal.
You are all aware about the famous decision of the Hon’ble Supreme Court in Union of
India vs. Tulsiram Patel reported in AIR 1985 Supreme Court page 1416. The issue
before the Supreme Court was relating to the interpretation of Articles 309, 310 and 311
of the Constitution of India and in particular after the amendment of Clause 2 of Article
311 by the Constitution (forty second amendment) Act, 1976, the second proviso to that
clause. Though the subject matter of the decision related to a service matter and the
safe guards conferred in Article 311 to persons employed in Civil capacities under the
Union of India or the State, the Supreme Court analysed in depth the principles of
natural justice. It was stated that the principles of natural justice are not the creation of
Article 14 of the Constitution of India and that Article 14 is not their begetter but their
Constitutional Guardian. The Supreme Court traced the ancestry of the principle which
we had seen at some length in the previous part of this lecture.
In the case of Tulsiram Patel the Supreme Court considered the issue as to how the
principles of natural justice had been interpreted by Courts and within what limits are
they to be confined. It was stated that by a process of judicial interpretation two rules
have been evolved has representing the principles of natural justice in judicial process,
including therein quasi judicial and administrative process. They being
a. no man shall be a Judge in his own cause
b. hear the other side – Audi Alteram Partem
From the above two rules a corollary has been deduced namely that he who shall
decide anything without the other side having been heard, although he may have said
what is right, will not have done what is right, in other words has it is now expressed,
Justice should not only be done but should manifestly be seem to be done.
6
While considering the Audi Alteram Partem rule it was observed that
 a person against whom an order to his prejudice may be passed should be
informed of the charges against him.
 Such person should be given an opportunity of submitting his explanation which
also include the right to no the oral and documentary evidence which are to be
used against him.
 Witnesses who are to give evidence against him be examined in his persons with
right to cross examine them.
 To lead his own evidence both oral and documentary, in his defence.
The Hon’ble Supreme Court in AIR 1963 SC page 1, Viswanathan vs. Abdul Wajid while
adjudicating a civil dispute inrespect of the Estate of one Ramalinga Mudaliar
considered the scope of Section 13 of the code of Civil Procedure which deals with the
effect of Foreign Judgments. For the purpose of the todays topic it would be useful to
refer to paragraph 40 and 41 of the Judgment which is as follows.
The plea that a foreign Judgment is contrary to natural justice has to be considered in
the light of the statute law of India and there is nothing in S.13 which warrants the
interpretation that a plea that a foreign judgment is contrary to natural justice is
admissible only if the party setting up the plea is not duly served, or has not been given
an opportunity of being heard.
It is the essence of a judgment of a Court that it must be obtained after due observance
of the judicial process, i.e., the Court rendering the judgment must observe the
minimum requirements of natural justice – it must be composed of impartial persons,
acting fairly, without bias, and in good faith; it must give reasonable notice to the parties
to the dispute and afford each party adequate opportunity of presenting his case. A
foreign judgment of a competent court is conclusive even if it proceeds on an erroneous
view of he evidence or the law, if the minimum requirements of the judicial process are
assured: correctness of the judgment in law or on evidence is not predicated as a
condition nfor recognition of its conclusiveness by the municipal Court. Neither the
7
foreign substantive law, nor even the procedural law of the trial be the same or similar
as in the municipal court. A judgment will not be conclusive, however, if the proceeding
in which it was obtained is opposed to natural justice. The words of the statute make it
clear that to exclude a judgment under CI. (d) from the rule of conclusiveness the
procedure must be opposed to natural justice. A judgment which is the result of bias or
want of impartiality on the part of a Judge will be regarded as a nullity and the trial
coram non judice.
The Hon’ble Supreme Court in Canara Bank and others vs. Sri Debasis Das and others
reported in AIR 2003 Supreme Court 2041 while considering the scope and ambit of the
Canara Bank Officers Employees (conduct) Regulations 1976 had analyzed in depth
“Natural Justice” and “Audi Alteram Partem”. The observation in the said Judgment
could be summarized as follows:
 Natural Justice is another name of commonsense Justice.
 Rules of Natural Justice are not codified canons.
 But they are principles ingrained into the conscience of man.
 Natural Justice is the administration of Justice in a commonsense liberal way.
 Justice is based substantially on natural Justice is based substantially on natural
ideals and human values.
 The administration of Justice is to be freed from the narrow and restricted
considerations which are usually associated with a formulated law involving linguistic
technicalities and grammatical niceties.
 It is the substance of Justice which has to determine its form.
 The expressions “Natural Justice” and “Legal Justice” do not present a water tight
classification.
 It is the substance of Justice which is to be secured by both and when ever legal
Justice fails to achieve this solemn purpose, natural Justice is called in aid of legal
Justice.
 Natural Justice relieves legal Justice from unnecessary technicality, grammatical
pedantry or logical prevarication.
8
 It supplies the omissions of a formulated law.
 As Lord Buckmaster said, no form or procedure should ever be permitted to exclude
the presentation of a litigants’ defence.
 The adherence to principles of Natural Justice as recognized by all civilized States is
of Supreme importance when a quasi – judicial body embarks on determining
disputes between the parties, or any administrative action involving civil
consequences is in issue.
 Notice it is the first limb of the principle of Audi Alteram Partem.
 Notice should apprise the party the case he has to meet.
 Adequate time should be given to make his representation.
In reason time the concept of Natural Justice has undergone a great deal of change. In
the sense that what particular rule of Natural Justice to be applied depends upon the
facts of that case, the statute governing the issue etc. The old distinction between an
Administrative Act and Judicial Act does not survive any longer. Every Administrative
order which involves civil consequences must follow the rules of Natural Justice.
The Hon’ble Supreme Court has held that in the absence of a notice and reasonable
opportunity to a person to meet the case against him, the order passed becomes wholly
vitiated. Having held so the Principles of Natural Justice have been interpreted by the
Hon’ble Supreme Court prescribing the limits to which they are to be confined.
What is known as “useless formality theory” was considered by the Hon’ble Supreme
Court in M.C.Mehta vs. Union of India (AIR 1999 Supreme Court page 2583). In the
said Judgment it was held
“Before we go into the final aspect of this contention, we would like to state that case
relating to breach of natural justice do also occur where all facts are not admitted or are
not all beyond dispute. In the context of those cases there is a considerable case law
and literature as to whether relief can be refused even if the Court thinks that the case
of the applicant is not one of “real substance” or that there is no substantial possibility of
9
his success or that the result will not be different, even if natural justice is followed”
The Hon’ble Supreme Court in Bar Council of India vs. High Court, Kerala reported
(2004) 6 SCC 311, held that principles of Natural Justice cannot to be put in a strait
jacket formula, it must be viewed with flexibility and when there is compliant of violation
of Principles of Natural Justice the Court may insists on proof of prejudice before
interfering or setting aside an order.
In the earlier part this decision we had seen that recording of reasons in an order
passed by a Court or a Tribunal is also one of the principles of the Audi Alteram Partem
Rule. The Hon’ble Supreme Court in Sri Jain Swetambar Terapanthi Vid (s) vs.
Phundan Singh reported in AIR 1999 SC 2322 was considering the validity of an
Appellate Court against and grant of injunction. In the said case the Trial Court granted
an order of injunction and the Appellate Court upset the order of injunction granted by
the Trial Court on the ground that the Trial Court has gone wrong in recording primafacie
satisfaction. The Hon’ble Supreme Court set aside the order of the Appellate Court
on the ground that the Appellate Court did not discuss the materials on record nor
recorded contrary finding. It would be useful to refer to the findings recorded by the Trial
Court.
“Petitioner has been successful, in my opinion, to establish the prima facie cases in its
favour. I am of the opinion that if the order of temporary injunction, as prayed for, is not
passed the interest of Petitioner as well as students, staff and guardian wil be adversely
affected in view of the fact that the allegations against O.P. Nos. 1 to 5 which have
been established prima facie are very serious. In view of that I am inclined to allow the
instant Petition for temporary injunction.
This finding of the Trial Court was reversed by the Appellate Court which came up for
consideration before the Hon’ble Supreme Court in the said case. The Supreme Court
while analyzing the aspects regarding prima-facie satisfaction and the need to record
reasons observed as follows.
10
It may be pointed out that it is one thing to conclude that the Trial Court has not
recorded its prima facie satisfaction on merits but granted the temporary injunction and
it is another thing to hold that Trial Court has gone wrong in recording the prima facie
satisfaction and setting aside that finding on the basis of the material on record because
it has not considered the relevant material or because it has erroneously reached the
finding or conclusions on the facts established. In the first situation, the appellate Court
will be justified in upsetting the order under appeal even without going into the merits of
the case but in the second eventuality, it cannot set aside the impugned order without
discussing the material on record and recording a contrary finding. The High Court
proceeded to set aside the order of the Trial Court on the first ground ignoring the
aforementioned findings of the Trial Court, the order under appeal is, therefore,
unsustainable.
In yet another case the Supreme Court while considering a proceedings arising out of a
general Court martial confirmed by Chief of Army Staff reported in AIR 1990 Supreme
Court 1984 in S.N.Mukherjee vs. Union of India observed that in view of the expanding
horizon of the principles natural justice, the requirement to record reason can be
regarded as one of the principles of natural justice which govern exercise of power by
administrative authorities. The rules of natural justice are not embodied rules. The
extent of their application depends upon the particular statutory framework where under
jurisdiction has been conferred on the administrative authority. With regard to the
exercise of a particular power by an administrative authority including exercise of
judicial or quasi judicial functions the legislature, while conferring the said power, may
feel that it would not be in the larger public interest that the reasons for the order passed
by the administrative authority be recorded in the order and be communicated to the
aggrieved party and it may dispense with such a requirement. It may do so by making
an express provision to that effect. Such an exclusion can also arise by necessary
implication from the nature of the subject matter, the scheme and the provisions of the
enactment. The public interest underlying such a provision would outweigh the salutary
purpose served by the requirements cannot, therefore, the insisted upon in such a case.
Therefore except in cases where the requirement has been dispensed with expressly or
by necessary implication, an administrative authority exercising judicial or quasi judicial
11
functions is required to record the reasons for its decision.
In the famous Meneka Gandhi vs. Union of India reported in AIR 1978 Supreme Court
597 the Hon’ble Supreme Court discussed the increasing importance of Natural Justice
and observed that Natural Justice is a great humanizing principle intended to invest law
with fairness and to secure Justice and over the years it has grown in to a widely
pervasive rule. The Supreme Court extracted a speech of Lord Morris in the House of
Lords which is an very interesting speech (I quote)
That the conception of natural justice should at all stages guide those who discharge
judicial functions is not merely an acceptable but is an essential part f the philosophy of
the law. We often speak of the rules of natural justice. But there is nothing rigid or
mechanical about them. What they comprehend has been analysed and described in
many authorities. But any analysis must bring into relief rather their spirit and their
inspiration than any precision of definition nor precision as to application. We do not
search for prescriptions which will lay down exactly what must, in various divergent
situations, be done. The principle and procedures are to be applied which, in any
particular situation or set of circumstances, are right and just and fair. Natural justice, it
has been said, is only “fair play in action”. Nor do we wait for directions from Paliament.
The common law has abundant riches; there may we find what Byles, J., called “the
justice of the common law”,. Thus, the soul of natural justice is fair play in action and
that is why it has received the widest recognition throughout the democratic world. In
the United States, the right to an administrative hearing is regarded as essential
requirement of fundamental fairness. And in England too it has been held that “fair play
in action” demands that before any prejudicial or adverse action is taken against a
person, he must be given an opportunity to be heard. The rule was stated by Lord
Denning, M.R. in these terms in Schmidt v.Secy. of State for Home Affairs: - (1969) 2
Ch. D 149 “Where a public officer has power to deprive a person of his liberty or his
property, the general principle is that it has not to be done without his being given an
opportunity of being heard and of making representations on his own behalf”.

Unit –VII
Judicial Control of Administrative Actions
7.1. Development of Judicial Review
7.2. Habeas Corpus
7.3. Writ of Mandamus
7.4.Writ of Prohibition
7.5.Writ of Certiorari
7.6.Quo Warranto

Remedies through writ Petition

While dealing with state liability, it is necessary to understand the remedy available under
Art~cle 32 and 226 of the Constitution in writ petition to the aggrieved in cases of human
rights violation by the state agencies. When the fimdamental rights are violated by the state,
the aggrieved can approach the writ court under Article 32 and 226 of the Constitution by
filing writ petition before the Supreme Court and the High Court. Writ is an order of the court
issued to a person or authority to do some act or forbear from doing some act. Writs are
expeditious and are an effective judicial tool to hold the government and its functionaries to
the performance of their official duties in the right spirit'34. 1. Origin, purpose and
proceedings of the Writ The Writ was developed in the sixqeenth century in the English law
which clung to the principle that " king can do no wrong" by which the king was subject to
law and could not break the law. According to English law, writ was an order of the king, it
was issued to the defendant to appeu before the court and to show cause against the plaintiffs
claim. In the beginning, the l~rit was the monopoly of the crown's concern. This was used by
th~: king as his prerogative to superintend over his officers and subordinate courts to protect
or safeguard the liberty of the citizen. In shon, the purpose of a writ was to see that the
crown's machinery of public administration works properly as well as to see justice is done to
the individuals. There was no human sgency to enforce law against the king. The courts were
the king's courts like other feudal lords, the king could not be sued in his own court, he could
be a plaintiff but he could not be a defendant. In tlie prerogative remedies available to the
aggrieved, the crown was the nominal plaintiff. No form of writ or execution would be issued
against the Crown. The Defendant might have infringed the legal right vested in the plaintiff.
This writ was issued to the defendant only if the claim made by the plaintiff came within the
recognized form of action. If the Plaintiff failed to get the writ and if his claim would not fall
within any one of the categories of recognized forms of right. he will go without remedy. No
one could bring an action without obtaining writ from the officer of the king. 2. Different
types of writs There were different kbufs of writs known in the family of prerogative
remedies like Habeas corpus, Certiorari, Mandanlus and Quo warranto. They all belonged to
the same ancestry. The writ of hahens corjws means that you have the body to submit or
answer. It is a prerogative writ for securing the liberty or subject from the wrongful
dqxivation of liberty of the subject or unlawful detention of the subject against his The main
object of the writ of Habeas Corpus is to give quick and immediate remedy to the person who
is unlawfully detained by another. If the court is satisfied that such a detention is illegal or
improper, it can direct the person to be set at liberty. And they are under legal obligation
towards such subjects and the writ of habeas corpus will lie for the enforcement of duties.
The writ of Mandamus is the order of the superior court commanding a person or public
authority to do or forbear from doing something in the nature of public duty or statutory duty.
The Writ of certiorari is an order, quashing the decision of the inkrior courts, if it is issued
due to the excess of jurisdiction, or disregarding the principles of natural justice .The purpose
of issuing this order is to cure the defects or, for correcting the error apparent 13' G.C
.Venkata Subb Rso Prerogativ~? Writs andFundmenrulRighfs (.1953) .p 53 on the face of
record, or to comply with the principles of natural justice. The Writ of Prohibition is an order
issued to prevent an inferior court or tribunal from exceeding its jurisdiction, preventing the
inferior courts from usurping the jurisdiction. It is designed to keep the inferior courts within
their appropriate jurisdiction. The Writ of Quo Warra~lto is issued calling upon a person or
authority to show what is the authority of such person is to hold the office. By this writ, a
holder of a public office is called upon to show the court, under what authority he holds the
office and to prevent a person from holding office without authority or to prevent him from
continuing to hold wlich he is not legally entitled to. These remedies have a special public
aspect which is one of the valuable features. An applicant of certiorari and prohibition need
not have to show his locus statrdi .If the action is excesses or abuse of power, the court will
quash it even at the instance of a stranger. So it gives priority to public right than personal
right. Evidence is given in writing rather than omlly. This prerogative writ is an extn ordinary
remedy issued only when suff~cient cause shown like imminent danger to the health of the
person who is under the custody of another. This writ is issued in the form of command to the
inferior courts to correct irresponsible officials. The Writ was also issued to secure the
appearance of the parties in particular where he was in detention by some inferior courts. And
it was later challenged when there was detention by the king and the council. Finally it
became the standard of procedure by which legality of any imprisonment could be tested.
Efficient remedies are most important in case of violation of gumanteed right. 3. Origin and
development of the Writs in India The power of judicial review guaranteed under Article 32
and 226 of the Indian Constitution has been inherited from Britain. Traditionally this Article
was used only by persons whose fUndarnental rights were infringed. Before the
commencement of the Constitution, the High courts other than those of Madras, Bombay and
Calcutta had the power to issue prerogative writs in the nature of writ of Habeas Corpus
under section 491 o F the Criminal Procedure Code 1898. Later this position was altered with
ample power of issuing writ to the High Courts under Article 226136. After the
commencement of Constitution, the High courts and the Supreme Court were empowered to
protect the precious rights of the citizen under Article 226 and Article 32 of the Constitution
to give immediate remedy or 13'
--------------------
The Writ of Certiorari
Author(s): Frank J. Goodnow Source: Political Science Quarterly, Vol. 6, No. 3 (Sep., 1891),
pp. 493-536 Published by: The Academy of Political Science Stable URL:
https://www.jstor.org/stable/2139490 Accessed: 21-07-2020 06:41 UTC JSTOR is a not-for-
profit service that helps scholars, researchers, and students discover, use, and build upon a
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JSTOR, please contact support@jstor.org. Your use of the JSTOR archive indicates your
acceptance of the Terms & Conditions of Use, available at https://about.jstor.org/terms The
Academy of Political Science is collaborating with JSTOR to digitize, preserve and extend
access to Political Science Quarterly This content downloaded from 49.36.62.118 on Tue, 21
Jul 2020 06:41:25 UTC All use subject to https://about.jstor.org/terms THE WRIT OF
CERTIORARI. I. History of the Writ in England. M ANY of the present features of the writ
of certiorari which is to-day, in our country, the chief means by which the courts review
administrative action - can be understood only by a study of its early history. Like most of the
English writs, it was originally a prerogative writ; i.e. it was issued by the King by virtue of
his position as fountain of justice and supreme head of the whole judicial administration. But
unlike most of its fellows, which have become what are known as writs ex debito /ustitiae, or
writs of right, the certiorari has preserved to a great extent - perhaps to a greater extent than
any other writ - its original characteristics as a prerogative writ. What now is meant, more
precisely, by a prerogative writ ? To answer this question requires an acquaintance with the
posi- tion of the Crown in the administration of justice at the time that this writ was
developed. One of the most important powers which accrued to the Anglo-Saxon chieftains in
the transition from the ducal to the royal dignity was judicial supremacy. The King was the
supreme head of the nation with power over life, limb and prop- erty. The judicial supremacy
did not, however, give him the right of pronouncing judgment; for this, in accordance with
the Teutonic institution of popular courts, belonged to the members of the community. What
it gave him was power to appoint the persons, viz. the sheriffs, who as royal representa- tives
called the popular courts together; to see that justice was rendered in case of its denial;
personally to judge those power- ful litigants who could not be controlled by the popular
courts; and to execute or have executed the sentences of the courts.1 1 Gneist, Constitutional
History of England (English translation, G. P. Putnam's Sons), vol. i, p. 23. 493 This content
downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All use subject to
https://about.jstor.org/terms 494 POLITICAL SCIENCE QUARTERLY. [VOL. VI. In the
Anglo-Saxon system of administering justice the Norman conquest at first introduced less
change than in the other branches of government. While in other matters the early Norman
Kings were absolute, in matters pertaining to the administration of justice the system was
much the same as before the conquest. William the Conqueror bound himself solemnly to "
maintain the good and well-tried laws of Edward the Confessor." This promise meant that the
law should be administered " by the same persons, and for the same persons, and according to
the same principles as in the Anglo-Saxon days." ' It is to be noted, however, that the Norman
Kings reserved to themselves from the beginning the decision of all cases affecting the
Crown, - including the more important criminal offences, which were regarded as violations
of the King's peace, - and also all cases affecting the revenue.2 The judicial pro- ceedings
which these cases necessitated were had before the King and the advisers whom the
transaction of public business had forced him to summon to his side, and who, when united,
formed what was known as the Curia Regis or Aula Regis, the court or household of the
King.3 Here the barons acted as judges, the King on their advice giving sentence. Soon this
essentially judicial business, which was continually increasing, was attended to always by the
same persons, and these persons got the name of justices, one of them being called the chief
justice or justitiar. This Curia Regis soon increased its jurisdiction. The ancient customary
process of the local courts, with that strict maintenance of formalities and that incapacity for
regarding equitable considerations which seems inseparable from the ideas of compurgation
and ordeal, was becoming antiquated. As a special favor, suits that belonged before the
popular courts were allowed to be brought before the Curia Regis, to be decided by such new
methods as the wisdom of the King and his counsellors might invent; and from the Curia
Regis began soon to issue a series of writs which directed 1 Gneist, op. ci. p. 165. 2 ibid. pp.
I68, 171- 8 Stubbs, Constitutional History of England, vol. i, PP. 387-390. This content
downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All use subject to
https://about.jstor.org/terms No. 3.] THE WRIT OF CERTIORARI. 495 inquiry and
recognition of rights as to land, the obligations of tenure, the legitimacy of heirs and the
enforcement of local jus- tice. These writs were undoubtedly derived from the process of the
Carolingian lawyers. They were the expedients by which the jus honorarium of the King as
fountain of justice was enabled to remedy the defects of the jus civile or commune as applied
in the local popular courts.' The extension of the jurisdiction of the Curia Regis was
accelerated by the partiality of the sheriffs who held the popular courts, and by the fact that in
these courts race prejudices were found to influence the decisions.2 Soon the officers of the
Curia Regis were sent about the coun- try; at first, in the time of Henry I, with no great
regularity; but later, periodically.3 These officers were known as the itine- rant justices or the
justices in eyre. They sat in the local courts, often taking the place of the sheriff.4 In II78
Henry II made great changes in this system. He found that there were too many justices in the
Curia Regis to do the work effectively. He therefore chose five of his own immediate
servants, two clerks and three laymen, before whom he ordered the complaints of the people
to be brought, but re- served the most difficult cases for his own hearing, to be decided as
before, i.e. in the Curia Regis. This delegation of certain of the justices " to hear all
complaints and do right " is regarded as the origin of the court of King's Bench, because the
five judges chosen were to sit in banco. All financial suits, i.e. suits relating to the royal
revenue, were still to be decided by the old Curia Regis, which, when organized for this
purpose, was known as the Exchequer. As a result of Magna Charta, which pro- vided that
free persons and free property were to be judged ac- cording to the law of the land, a special
court split off from the Exchequer. The Exchequer proper henceforth exercised admin-
istrative functions only. The new special court came to be known as the court of the
Exchequer. It was organized simi- larly to the court of King's Bench. The adoption of Magna
Charta resulted also in the formation of another court, viz. the Stubbs, op. cit. I, pp. 387-39I.
2 Gneist, op. cit. I, I68. 8 22 Henry II, Statute of Northampton. 4 Gneist, op. cit. I, 392. This
content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All use subject to
https://about.jstor.org/terms 496 POLITICAL SCIENCE QUARTERLY. [VOL. VI. court of
Common Pleas. Magna Charta provided that the comn munia placita, common pleas or civil
suits, were to be held at some fixed place and were not to follow the King about on his
journeys throughout the country; accordingly, the seat of this court was fixed at Westminster.'
The itinerant justices of the Curia Regis were soon replaced by the justices of nisiprius and
assize, who were members of the royal courts.2 In this way the entire administration of
justice fell into the hands of the judges of the royal courts. But notwithstanding the formation
of these common law courts, the King remained as before the fountain of justice; for, as we
have seen, at the time of the formation of the court of King's Bench the King reserved to
himself the decision of the most difficult cases. This reserved justice re- sulted later in the
formation of other courts which have played a most important part in the development of
English law.3 Further, the development of these royal law courts did not shut the people out
of all participation in the administration of justice. The judges appointed by the King were for
the most part officers of a professional character; that is, they were edu- cated in the law; but
it was only the decision of the question of law that was taken out of the hands of the people
and given into the hands of these judges. The decision of the question of fact was still
rendered by the people, or by committees of the people which developed into the English
jury. By the end of the thirteenth century, as a result of this devel- opment, the judicial
supremacy of the King was something quite different from what it had been at the beginning
of the Norman period. The King was now the supreme head of the judicial system, the
fountain of justice, in a sense until then unknown to the middle ages. He was in judicial
matters what he was in other matters- practically absolute. All the judges, both at the centre
and in the localities, were paid servants of the King and subject to his disciplinary power.4
While actually I Stubbs, op. cit. I, 486, 6oI; Gneist, Op. cit. I, 386. 2 I3 Edw. I, c. 30. 8
Stubbs, op. cit. I, 603; Palgrave, Essay on the Authority of the King's Council. 4 For example,
we find Edward I removing his chief justice and fining others for extortion and corruption.
Gneist, op. cit. I, 391. This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020
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CERTIORARI. 497 working on separate lines, the three central courts remained formally
connected with the King's personal representative, the Chancellor. From his office proceeded
all the writs which were formulated by the King and his advisers, and by which actions were
commenced.' By the time the royal courts were fully developed most of these writs were no
longer writs of grace, granted by the King in his good pleasure, but were issued to litigants
upon proper demand de cursu and became known fin- ally as writs ex debito justitiae. Before
long the court to which the application was made issued the necessary writ directly, without
the intervention of the Chancellor.2 It was thus that the court of King's Bench received the
power to issue a series of writs -viz. mandamus, certiorari, prohibi- tion and quo warranto-
through which it controlled the action of the other courts. The King's Bench was regarded as
the highest court in the land, with a superintendence over all other courts; and, as there was
no conscious distinction between jus- tice and administration in these early days, over all
lower author- ities, whatever their nature. This position of superiority over the other
authorities was due to the fact that the King was sup- posed always to sit in the King's
Bench.3 But although the writs just mentioned were issued without the intervention of the
Chancellor, they never became writs ex debitojustitiae or de cursu, since it was only in
extraordinary cases that they were issued and only when some gross injustice was being done
by other authorities. It remained the function of the King, through his 1 "The defendant in the
cases in the royal courts was summoned into court by writ original under the King's seal,"
which was kept in the office of the Chancellor. Palgrave, op. cit. p. 8. 2 Thus King John gave
to the Chief Justitiar authority to issue five writs; among them the important real-property
writs of mort d'ancestor, novel disseizin and de recto. In the time of Edward I the clerks of
the Chancellor were also allowed to issue in plain cases new writs in consimili casu, from
which came the action on the case. - Gneist, op. cit. I, 394; Palgrave, op. cit. pp. i6, 17;
Reeves, History of the English Law, II, 394, 507, 605. 8 The King's Bench was the "curia
ubiquefuerimus in Anglia." Bracton speaks of its judges as " chief, general, perpetual and
superior, residing by the side of the King, who are to correct the injustice and errors of a11
others." See Gneist, op. cit. I, 384 This content downloaded from 49.36.62.118 on Tue, 21 Jul
2020 06:41:25 UTC All use subject to https://about.jstor.org/terms 498 POLITICAL
SCIENCE QUARTERLY. [VOL. VI. court of King's Bench,' to judge of the necessity for
their issue, and they accordingly came to be known as prerogative writs. And they came to be
regarded as among the most important judicial remedies. It must, however, be remembered,
when we speak of judicial remedies or of judicial bodies in these early times, that we do not
mean what would be meant at the present time by such expressions. As has been shown, the
judges of these tribunals had no fixed tenure. Like other royal officers, they were subject to
the disciplinary power of the King; and the King not unfrequently made use of his power to
influence their decisions.2 Not only was the tenure of the judges the same as the tenure of
royal officers in general, but there was no distinction made between judicial and
administrative business. The justices of the peace, who had become the most important
administrative officers in the localities (taking the place origi- nally occupied by the sheriffs),
had many important judicial duties to perform, and were regarded as judges - just as much so
as the members of the royal courts. The court of King's Bench had powers of control over the
justices of the peace, just as it had over all other authorities. It controlled the adminis- tration
of government as well as that of justice. The reason why the King permitted the court of
King's Bench to exercise such a control over administrative matters is to be found in the
tenure of its judges, and in the fact that the King had still powers of reserved justice. He could
exercise the strongest personal influence over the judges of the royal courts; and, if he found
that the administration of the law was becoming too formal and technical to permit of
efficient administration, he might exercise his reserved powers and transfer any matter to 1
Some of these writs were issued by the Council, i.e. the Curia Regis, even after the
development of the court of King's Bench. Thus the first.case of mandamus on record, in the
time of Edward II, was returnable to the Council. I Ryley's Plead- ings, 534. But a case is
referred to in Burrow's Reports, p. 2190, where this writ issued from the King's Bench. The
first recorded case of quo warranto is found on the roll of the Curia Regis. Abbreviatio
Placitorum, p. 21. Later, however, the King's Bench obtained the practically exclusive power
to issue these prerogative writs. 2 Witness the famous Hampden case in the court of the
Exchequer. The judges were for the first time made independent of the King by the Act of
Settlement, 1701. This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25
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499 a newly created jurisdiction.' Thus was formed in the time of Henry VII the court of the
Star Chamber, in order to control the nobility who had grown turbulent during the Wars of
the Roses.2 To this court was given a control over the actions of the justices of the peace
which aimed at correcting not merely their decisions upon questions of law, -these were
practically the only questions that came up before the King's Bench, -but also their decisions
on questions of fact ,and of expediency.3 Established originally to protect the weaker classes
from the tyranny of the nobility, this court was used by the Stuarts in a fashion that led to its
abolition in I640. The result of its aboli- tion was to remove the justices of the peace from all
central control except that which was exercised by the court of the King's Bench over their
decisions on questions of law. To pro- vide some sort of control over the justices acting
separately, which should extend to their decisions on questions of fact and expediency, a
series of acts of Parliament permitted the indi- vidual, when injured by the act of a justice, in
specified cases to appeal to the court of Quarter Sessions of the county.4 This court consisted
of all the justices of the county sitting together. As a result of these statutes, appeals might be
taken to the Quarter Sessions from almost all acts of the justices affecting property rights or
personal liberty.5 There was thus formed in each county, for the decision of administrative
questions, a court whose jurisdiction embraced both questions of law and questions of fact or
expediency. Further, the commission of the justices of the peace enjoined upon them in
difficult cases to take the I Cf. Palgrave, O01. cit. pp. 57-6I. 2 Other instances of the exercise
of the reserved justice of the King are to be found in the establishment of the court of
Chancery and of the Council of the North and the Council of the West. To deal with the
religious questions resulting from the Reformation was established the court of High
Commission. Later exam- ples may be found in the establishment of the Probate and Divorce
courts, after this jurisdiction had been taken away from the ecclesiastical courts, and finally in
the Judi- cial Committee of the Privy Council for ecclesiastical and colonial appeals. Cf
Stubbs, op. cit. I, 603. 8 Cf Palgrave, op. cit. pp. ioi-io8. 4 See Smith, Practice at Quarter
Sessions (London, I882), title Appeals. 6 Gneist, Das Englische Verwaltungsrecht (I884), p.
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VI. advice of the royal courts. This came to be done finally by stating a case which was
agreed upon by the justices and the parties before them, and which was then submitted to the
royal courts and was finally decided by them.' In consequence of these facts the certiorari lost
much of its earlier importance in England, and its employment there became less frequent.2 It
had served the purpose of bringing proceedings of the justices, and of subordinate tribunals
generally, before the King's Bench for review.3 It was often used as a sort of an appellate
proceeding, e.g. against the convictions and orders of justices of the peace;" but it was more
often used for the pur- pose of removing a case before final judgment, where for some reason
it was believed that a fair and impartial trial could not be had. Indeed the most common use
of the writ in early times seems to have been to remove indictments before the justices. The
reason why it was less often employed in appel- late proceedings is to be found in the
existence of the other methods of appeal from the final judgments of the justices which have
been pointed out. Finally, the certiorari was also used in the course of ordinary appellate
proceedings to bring up the record of the lower court from whose decision appeal had been
taken, on the ground that the record as sent up was incomplete. This was called technically
"certiorari for diminution of the record." 5 The writ of certiorari was therefore used from the
beginning for three distinct purposes; first, as a means of removing a cause; second, to review
a determination; and third, as means of correcting diminution in another proceeding -i.e. as an
auxiliary remedy. It is to a consideration of the certiorari as an independent appel- late
proceeding that this article will be devoted. In our country this is by far its most important
use; because, for a number of reasons, we have been unable to develop generally any such I
Smith, op. cit. p. 518. 2 Gneist, Verwaltungsrecht, p. 406. S The certiorari " lieth where the
King would be certified of any record." Fitz- herbert, Natura Brevium, p. 554. "The end of
the writ is that more sure or speedy justice be done." Bacon's Abridgement, I, 559. 4
Hawkins, Pleas of the Crown, vol. iv, p. 145, ?? 3, 4, p. i56. 5 Tidds' Practice, II67, citing
Cro. Eliz. I55. This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25
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501 methods of appeal from administrative decisions as have been created in England-any
such methods as the appeal to the Quarter Sessions or the "statement of the case." There are,
indeed, throughout our Southern commonwealths instances of appeals from the decisions of
administrative officers to the county courts (which have largely taken the place in this coun-
try of the English courts of Quarter Sessions); and there are a very few instances of such
appeals in other commonwealths. But in general our only method of appeal from
administrative decisions has been by certiorari, and we have therefore been obliged to give to
this writ a development which has greatly enlarged its scope and usefulness. Before I attempt
to trace this development, it will be well to indicate how far the certiorari has retained its
original prerogative characteristics, and what courts may issue the writ in the United States.
II. Character of the Wrt in the United States. In this country the general tendency has been to
strip the cer- tiorari of its prerogative character, and to reduce it to the posi- tion of an
ordinary action. Nevertheless, even at the present time, the writ bears very plainly the stamp
that was impressed upon it at its origin. Thus, for example, certiorari does not issue of course,
as does the ordinary summons in an action; application has to be made to the proper court,
and this may refuse or grant the application for the issue of the writ in its own discretion.' In
the exercise of this discretion the courts have laid down several rules by which they will be
guided. (I) They will not issue the writ if there is any other adequate remedy; i.e. certiorari is
an extraordinary remedy. Adequate remedies have been held to exist where it is possible to
obtain a writ of error,2 or to appeal, even to an administrative 1 Duggen vs. McGruder, i
Miss. 112; People vs. Mayor, 2 Hill (N. Y.) 9; Matter of Mount Morris Square, Ibid. 14. See
also section 2127 of the New York Code of Civil Procedure. This section of the code has
been construed by the New York Court of Appeals as providing that the decision of the court
withholding or granting the issue of the writ cannot be reviewed in the Court of Appeals.
People vs. Stillwell, I9 N. Y. 531; People vs. Hill, 53 N. Y. 547; People vs. Commissioners,
82 N. Y. 5o6. 2 Petty vs. Jones, i Iredell L. (N. C.) 408. This content downloaded from
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authority,l or to apply for any statutory remedy.2 The only important exceptions to this rule
are to be found in some cases where an appeal lay on the merits, and where nevertheless cer-
tiorari was issued to test the question whether the tribunal whose record was to be brought up
had exceeded its jurisdic- tion ;3 and in certain other cases, especially in North Carolina and
Tennessee, where it is held that if one without fault has lost the right to appeal, he may get a
certiorari if the time for appeal has gone by.4 (2) The courts have held that they will not issue
a certiorari where the party applying for it is guilty of laches and has slept upon his rights.5
(3) The courts will not issue a certiorari where substantial justice has been already done, or
where very mischievous con- sequences will result from its issue, or where the parties cannot
be placed in statu quo by its issue,6 or for a mere defect in form 7 or of jurisdiction.8 (4)
Finally the courts have held that the certiorari may not be used simply for the purpose of the
maintenance of the law. That is, persons applying to the courts for the issue of the writ 1
Beck vs. Knabb, I Overt. 55, 59, 60; Storm vs. Odell, 2 Wendell (N. Y.) 287; O'Hare vs.
Hempstead, 21 Iowa, 33; N. Y. Code, sec. 2122, paragraph 2. 2 Tucker's Petition, 27 N. H.
405; Baldwin vs. Goodyear, 4 Cowen, 536. See also Harwood vs. French, 4 Cowen, 501. 3
Kingsland vs. Gould, 3 N. J. L. i6i; Krummick vs. Krummick, I4 N. J. L. 39; Burrows vs.
Vandervier, 3 Ohio, 383. 4 Trice vs. Varborough, 4 Iredell L. (N. C.) i I; Kearney vs.
Jackson, i Verg. (Tenn.) 294; Skinner vs. Maxwell, 67 N. C. 257; King vs. Williams, 7
Heiskell (Tenn.) 303. 6 Ex fiarte Hagaman, 2 Hill (N. Y.) 415; Bannister vs. Allen, I
Blackford (Ind.) 415; Holden vs. Commissioners, 7 Metcalf (Mass.) 561; Elmendorf vs.
Mayor, 25 Wendell, 693; Bentz vs. Detroit, 48 Mich. 544; Carpenter vs. Commis- sioners, 64
Mich. 474. The time within which the writ may be applied for is some- times fixed by statute.
Thus the N. Y. Code, section 2125, allows four months after the determination in which to
issue and serve a certiorari reviewing the determination. G Hancock vs. Boston, i Metc.
(Mass.) 122; Rutland vs. Worcester, 20 Pick. (Mass.) 71; Gleason vs. Sloper, 24 Pick. i8i;
People vs. Supervisors, 15 Wendell, I98; People vs. Rochester, 2I Barb. 656. 7 Elmendorf vs.
Mayor, 25 Wendell, 693; Monterey vs. Berkshire, 7 Cushing (Mass.) 394; Smith vs.
Commissioners, 42 Me. 395, 402; Criswell vs. Richter, 12 Texas, I8. 8 Fowler vs. Lindsey, 3
Dallas (U. S.) 411, 413. This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020
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CERTIORARI. 503 must show to the satisfaction of the court that they have some special
interest involved which is peculiar to themselves and that the issue of the writ will result to
their advantage.' Thus the courts have refused the issue of a certiorari to declare a muni- cipal
ordinance void, where the applicant for the writ had been convicted of its violation and had
paid the fine imposed; 2 or to reverse the action of an authority in laying out a drain, where
the applicant for the writ could show no personal injury from the action complained of. The
simple allegation also that the applicant was a resident and a taxpayer has been held to be
insufficient to justify the issue of the writ in the absence of any further special interest.3 Such
are the prerogative charac- teristics of the writ of certiorari at the present time. III. What
Courts may Issue the Writ. As the certiorari is a writ of an extraordinary character, it is not
every court that is permitted to issue it. It has already been shown that in England, after the
disintegration of the King's Council and the development of special royal courts, it was the
court of King's Bench that possessed the power to issue the extraordinary legal remedies or
prerogative writs of which the certio>ari was one. As a result of this fact, the rule in the
United States seems to be that certiorari as a means of appeal issues only from these courts
which have inherited the jurisdic- tion of the English court of King's Bench. What courts
have inherited this jurisdiction is usually determined by the constitu- tions or statutes of the
separate commonwealths. In New York the code of civil procedure, section 2123, provides
that where no special exception is made by law, certiorari to review a determi- nation can
issue only out of the Supreme Court or a superior city court. But while the matter is thus
governed largely by special statute, still two general principles may be laid down: 1 People
vs. Leavitt, 41 Mich. 470; People vs. Walter, 68 N. Y. 403; People vs. Phillipps, 67 N. Y.
582. 2 People vs. Leavitt, 41 Mich. 470. 8 State vs. Lamberton, 37 Minn. 362. See also
Granville vs. County Commis- sioners, 97 Mass. 193; Waston vs. May, 6 Ala. 133; Davis Co.
vs. Horn, 4 Greene (Iowa) 94. This content downloaded from 49.36.62.118 on Tue, 21 Jul
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SCIENCE QUARTERLY. [VOL. VI. (i) Certiorari may not ordinarily be issued by courts of
limited jurisdiction, but only by courts of general common-law jurisdic- tion, since it is only
the latter class of courts that have inherited the jurisdiction of the court of King's Bench. (2)
The issue of the writ is an exercise of an original j urisdic- tion; and therefore courts whose
jurisdiction is appellate only cannot, in the absence of statutory provisions, issue the writ to
review a determination. Of course appellate courts do issue the writ when it is used for the
purpose of correcting diminution. As far as the United States courts are concerned, it may
further be laid down, as a general principle, that they have not the power to issue certiorari to
review a determination. Several cases have decided that certiorari will not issue from the
Supreme Court except in case of diminution,' or from the circuit courts except as an auxiliary
remedy ;2 while the same reasons which forbid the higher courts to issue the writ - viz. the
absence of the grant of such jurisdiction in the constitution or in the judiciary act -would
seem to preclude its issue by the district courts. There seems, however, to be no reason why
the Supreme Court of the District of Columbia should not have the power to issue the writ of
certiorari; for it is well settled that it has the power to issue the mandamus, and this latter
power is derived from the fact that it has inherited for the territory of the District of Columbia
the jurisdiction of the King's Bench.3 It should be noted that the McKinley administrative act
gives the circuit courts of the United States power to issue certiorari to review the
determination of the general appraisers as to rates of duties and classification of articles. The
effect of this will at once be seen, when it is remembered that by this act suits against the
collector of the customs may no longer be entertained by the United States courts. Where
there was 1 In re Kaine, 14 Howard, 103, 131; Exparte Metzger, 5 Howard, 176; U. S. vs.
Young, 94 U. S. 258, 259; Exparte Vallandigham, I Wallace, 243. 2 Ex park Van Orden, 3
Blatchford, I67. See also Patterson vs. U. S. 2 Wheaton, 221. 8 See Kendal vs. U. S. 12
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previously a remedy of right, a writ ex debito justitiae, there is now only a prerogative
remedy which the court may grant or refuse in its discretion. IV. Authorities Subject to the
Writ. Certiorari to review a determination was employed from the outset as a method of
appeal from the decisions of authorities or tribunals not acting in accordance with the
common law, - i.e. created by statute and possessing only a limited jurisdiction.' The regular
method of appealing from the decisions of author- ities possessed of general common-law
jurisdiction was by writ of error. Among the authorities subject to certiorari were in- cluded
all quasi-public bodies, - e.g. the disciplinary authority in a profession or the visitors of a
foundation, - as this was the only way by which their proceedings could be kept within the
law.2 Originally the justices of the peace were the officers to whom certiorari was most
frequently issued. They formed the most important class of authorities not acting in
accordance with the common law. Now the justices of the peace had both judicial and
administrative functions to discharge; but these two classes of functions were not clearly
distinguished. Their administrative functions were treated as judicial, largely because they
were discharged by officers who had come to be recoginized as judges. In this country,
however, justice has been separated from administration. This separation began in New York
with the establishment of the office of supervisor in I683; and it has 1 Rex vs. Inhabitants in
Glamorganshire, i Ld. Raymond, 580; Bacon's Abridg- ment, art. Certiorari, B. This rule has
been very generally adopted in the United States. Commonwealth vs. Ellis, i Mass. 464; Ex
pare Tarleton, 2 Ala. 35, citing cases; Commonwealth vs. Low, R. M. Charleton (Ga.) 298;
Ruhlman vs. Commissioner, 5 Binney (Pa.) 24; Phillips vs. Phillips, 8 N. J. L. 122; Trigg vs.
Boyce, 4 Hayward (Tenn.) Ioo; Wil- liams vs. Carman, i Gill & J. i84, 196; Matthews vs.
Matthews, 4 Iredell (N. C.) 155; Bridge Co. vs. Magoun, 8 Greenleaf (Me.) 292, 293; Appeal
of Commissioners, 57 Pa. St. 452. 2 See a very interesting case, Groenvelt vs. Burwell, I
Salkeld, 263, I Ld. Raymond, 580, in which it was held that certiorari lay to review a
judgment given by the censors of the College of Physicians and Surgeons. For a similar case
in the United States, see State vs, Swift, 2 Hill (S. C.) 367. This content downloaded from
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so general that almost all administrative work is attended to, at any rate in first instance, by
officers unconnected with the administration of justice, such as supervisors, assessors, high-
way commissioners, overseers of the poor, selectmen, etc. When this separation of
administration from justice was accomplished, it was questioned whether the courts could
make use of cer- tiorari to review the acts of the new administrative authorities. They had
indeed always used the writ to review the acts of persons discharging similar functions; but
these persons had been regarded as judicial officers, while the new authorities were purely
administrative. The question was not ordinarily stated in the form here indi- cated. It was
generally stated thus: May the courts issue certiorari to review other than judicial acts? And,
following old traditions, some of our courts early laid down the rule that they would not issue
certiorari to review a ministerial or legis- lative act, but would confine its use to the review of
judicial acts. This rule seems clear and simple; but it has proved to be difficult of application.
In determining what is and what is not a "judicial act" it was obviously possible for the courts
to consider either the nature of the act itself or the character of the authority performing the
act. But if they sought to apply the first of these tests, they were confronted by an ambiguity
in the use of the term "judicial act." This was often employed as equivalent to "discretionary
act "; and, as we shall see later, it was a rule of the common law that dis- cretionary acts were
sot reviewable on certiorari; so that this line of distinction seemed wholly unavailable.
Accordingly the courts sometimes fell back on the second test; and refused to recognize any
act as judicial unless it was performed by a court. But there was still a third possible
construction. Starting from the principle of the separation of governmental powers, the courts
might hold that an act performed by a body not strictly judicial in character was nevertheless
an exercise of judicial power as distinguished from executive or legislative power, and
therefore a judicial act. It is in fact in this last sense that the courts seem generally to have
used the term "judicial act" in This content downloaded from 49.36.62.118 on Tue, 21 Jul
2020 06:41:25 UTC All use subject to https://about.jstor.org/terms No. 3.] THE WRIT OF
CERTIORARI. 507 laying down the above rule.' Here it is obvious that the courts revert to
the attempt to determine the nature of the act itself, although they seek to do this by an appeal
to a new standard, viz,. the nature of the power exercised. But this attempt brings new
difficulties. It is a simple matter to say whether or not an act has been performed by an
authority which constitutes part of the judicial branch of the government as actually
organized; but to determine whether the power exercised by a particular authority in a given
case is or is not judicial in its natutre is anything but a simple matter. It is far from easy to
apply the principle of the separation of powers to existing governmental institutions. It is very
difficult to discover by its aid any clear line of demarcation between administrative or
legislative acts on the one hand and judicial acts on the other. And it is even more difficult to
obtain any general agreement upon such ques- tions, for the simple reason that the standard
applied is purely subjective. The separation of governmental powers is not a statement of
what is, but a theory of what ought to be. The difficulties here indicated have manifested
themselves in almost every concrete case in which the courts have attempted to apply the
rule. The difficulty of reaching a decision and the confusion of decisions reached have been
especially marked in the matter of the laying out of highways and streets and the building of
sewers. The courts of Alabama, Massachusetts and Michigan hold that the action of
commissioners of highways or of a com- mon council of a city in laying out highways and
streets is judi- cial in character and may be reviewed on certiorari.2 The courts of Maine and
New Hampshire hold that the same duty, when performed by selectmen of a town, is not
judicial and that their act may not be quashed on certiorari.3 But the courts of the latter state
further hold that when this act is performed by a court, e.g. the court of sessions or the county
court, it is judi- 1 See Commissioners vs. Kane, 2 Jones L. (N. C.) 288. 2 Commissioners vs.
Thompson, I5 Ala. 558; Commonwealth vs. West Boston Bridge, 13 Pickering, I95; Parks vs.
Boston, 8 Pickering, 2I7, 225; Stone vs. Bos- ton, 2 Metc. 220; People vs. Brighton, 20 Mich.
57. 3 Harlow vs. Pike, 3 Greenleaf (Me.) 438; Robbins vs. Bridgewater, 6 N. H. 524. This
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character and therefore may be reviewed.' In New York the power of the courts to issue the
certiorari to highway com- missioners is doubtful; 2 and the power of the courts to issue the
writ to the common councils of cities to review their acts in the matters of streets and sewers
is denied.3 The New York rule is thus opposed to that adopted in Massachusetts, and this
opposition is due to the fact that the New York courts could not bring themselves to regard
acts which were plainly of an admin- istrative character (or, as the courts say, of a quasi-
legislative or ministerial character), as judicial acts. In the case of People vs. Mayor,4 the
judge carries the distinction to quite a length in saying that while " an ordinance of the
common council for the construction of the sewer . . . was a simple exercise of their minis-
terial, or, if I may use the expression, legislative power," and while the decision of the
council on the question of expediency could not be reviewed; still " it is competent for us in a
proper case to vacate the estimate and assessment of the common council in affirming those
proceedings, as they then acted in a judicial capacity." That is, if sewers were built from the
proceeds of bonds or taxation, no matter how illegal or irregular the ordi- nance ordering the
construction was originally, certiorari would not issue, because the ordinance was not a
judicial act; but if the sewers were to be built from the proceeds of assessments for local
improvements, certiorari would issue to quash the decision 1 Robbins vs. Bridgewater, 6 N.
H. 524; Dorchester vs. Wentworth, 31 N. H. 45i. This latter rule, that the action of bodies
recognized as courts in laying out highways is judicial and subject to the writ of certiorari,
seems to be the general one. See Nichols vs. Sutton, 22 Ga. 309; French vs. Barre, 50 Vt.
567; Prigden vs. Ban- nerman, 8 Jones L. (N. C.) 26; Ex parle District of Pittsburgh, 2 Watts
& Sergeant (Pa.) 320; Thompson vs. Multonomah Co., 2 Oregon, 34. 2 See Lawton vs.
Commissioners, 2 Caines Rep. I79; People vs. Covert, I Hill, 674; Fitch vs. Commissioners,
22 Wendell, I32. 8 Thus the New York courts have held that a city ordinance directing the
building of a sewer or the opening or widening of streets is not a judicial act and is therefore
not reviewable on certiorari. People vs. Mayor, 2 Hill, 9; People vs. Mayor, 5 Barb. 43;
Matter of Mount Morris Square, 2 Hill, I4. Two of the cases holding this view (viz. 2 Hill, 9
and 5 Barb.) are not very strong, inasmuch as the certiorari was refused partly, at any rate, on
the ground that the issue of the writ was discretionary with the court. But in both cases the
distinction between judicial and other acts seems to have influenced the decision. 4 5 Barb.
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assessment if it was based upon an illegal ordinance, since the act of assessment was a
judicial act.' In the Matter of Mount Morris Square,2 which is a particularly interesting case,
Judge Cowen takes somewhat the same position. He criticises the attempts (particularly in the
case of Parks vs. Boston),3 to classify acts purely legislative or admninistrative in character
under the head of judicial acts, and explains these attempts as due to the fact that municipal
authorities have been assimilated with the English commissioners of sewers, who (he says)
were regarded as courts.4 He thus seems to adopt the rule that the character of the act is
determined by the character of the body which performs it. He soon, however, departs from
this standard and adopts the rule that the character of the act is determined by the character of
the power exercised: for he proceeds to analyze the acts of municipal corporations and their
officers and finds that they consist, in the first place, of what he calls corporate acts, e.g. the
making of by- laws, voting taxes, appointing officers; in the second place, of governmental
powers, e.g. the power of eminent domain for streets; in the third place, of really judicial
powers, e.g. the power to assess property. In this last class of cases alone he believes that
certiorari may issue, though he admits, citing Ex parte Mayor of Albany,5 that it had become
the fashion to ask for certiorari in the other cases as well. He cites the case of Leroy vs.
Mayor 6 as the cause of all the trouble in New York, since it allowed the writ to issue to the
corporation instead of to the commissioners of assessments. The result of this opinion and of
the determined attempt on the part of Judge Cowen to prevent any confusion as to what was a
judicial act7 was to keep the law of New York, for a time at least, in line with his 1 See as to
this point People vs. Mayor, 9 Barb. 535, 542. 2 2 Hill, 14. 8 8 Pickering, 217. 4 This point
has really very little force; for in England, as has been pointed out, no distinction was
originally made between administrative and judicial bodies. 6 23 Wendell, 277. 6 20 Johnson,
430. 7 But even after his explanation, the distinction between judicial and other acts was not
very clear, See Rochester White Lead Co. vs. the City of Rochester, 3 N. Y. 463, 467. This
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and to give less protection to private rights than the Massachusetts rule afforded.1 Thus in the
case of People vs. The Board of Health,2 the judge bases his decision upon this general rule,
that the act must be judicial in character, saying: I cannot adopt the conclusion that it is in any
sense proper to review the legislation of any body having authority so to do, even where in
the course of such legislation they might exceed the powers vested in them. This New York
rule seems to have gained a foothold in Ohio.3 Such is the result of the attempt to apply to
actual practice the rule that certiorari will issue only in case the act to be reviewed is a
judicial act. In the concrete case of highways and the like, the Massachusetts rule differs from
the New York rule and, while it affords fuller protection to private rights, is less logical; and
in New Hampshire the whole question is made to turn on the character of the body
performing the act. If per- formed by the selectmen, the act is not judicial and may not be
reviewed; if performed by a court of sessions, a well-recognized judicial body, the same act is
metamorphosed into a judicial act and may be reViewed on certiorari. The rule is therefore
practically unsatisfactory, - a fact which ha.s been recognized by the courts of several
common- wealths, but first and most clearly by those of New Jersey. The New Jersey courts
have wholly rejected it, and have taken the ground that ordinances passed by a city council
may be reviewed on certiorari, not because they are judicial acts, but because of the general
principle that the courts have power on certiorari to remedy wrongs inflicted upon individuals
whether by corporate acts or by the acts of special jurisdictions created by statute.4 In the
case of Camden vs. Mulford the judge who delivers the opinion of the court says that, before
the attack of Judge Cowen already spoken of, evidence of the belief in the existence of this
general principle is to be found in some of the New York cases. And it is to be noted that in
some of the earlier cases cited later in this article -particularly in the 1 Cf Dillon, Municipal
Corporations (4th ed.), II, 1126, notes. 2 20 How. Pr. 458, 460. 3 Dixon vs. Cincinnati, 14
Ohio, 240. 4 State vs. New Brunswick, Coxe (N. J.) 393; Camden vs. Mulford, 26 N. J. L. 49.
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subject to https://about.jstor.org/terms No. 3.] THE WRIT OF CERTIORARI. 511 Cardiff
Bridge case -the English judges seem to have been of the same opinion. The only objection to
the New Jersey rule would seem to be found in the old distinction between void and voidable
acts. It is claimed that certiorari is unnecessary in the case of a void act, because such an act
may be impeached collaterally; that all acts not judicial, when done in excess of jurisdiction,
are void; and therefore that certiorari should not issue to declare them so. From the standpoint
of legal logic it may be answered that a judicial declaration of the original nullity of an act is
not the same thing as the impeachment of a void- able act, and that certiorari may be used for
the former purpose without transforming the act reviewed into a voidable act. As far as
historical precedent is concerned, this distinction, as I shall point out later, really never had
any great influence upon the issue of the writ in England nor, it may be added, in this
country, notwithstanding several dicta to the contrary. As a matter of policy, this distinction
is objectionable, because its application would deprive individual rights of a most precious
means of protection in a class of cases which is increasing in number with the more complete
separation of administration from justice. The New Jersey rule has been practically adopted
in several other commonwealths - though sometimes, apparently, without full consciousness
of the fact on the part of the courts. Thus in Maryland it has been held that certiorari will
issue to review the action of the mayor and common council of a city in improving the
streets; but no reason is given for the decision except the general power of the courts to quash
illegal action on certiorari.1 In Illinois a certiorari issued to review the action of highway
commissioners on the broad principle again that " certiorari may issue for the purpose of
reviewing the pro- ceedings of all inferior tribunals and jurisdictions where they exceed their
power or proceed without authority of law." 2 The same doctrine seems to be held in
Missouri 3 and in a late case I Swann vs. Mayor, 8 Gill, I50. 2 Detrick vs. Highway
Commissioners, 6 Bradwell, Ill. Appeals, 70. 3 St. Charles vs. Rogers, 49 MO. 530. This
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Maine.' The United States Supreme Court has either held or intimated that certiorari is the
proper remedy in these cases, though here again no reasons are given.2 In Wisconsin
certiorari has issued to test the validity of the proceedings of a common council in laying out
streets,3 and was said to be the proper remedy to review the revocation of a license by a
council.4 In one Wisconsin case the court was confronted with an awkward alternative. It was
called upon to determine whether the deci- sion of the superintendent of public instruction
concerning the division of a school district could be reviewed upon certiorari. If the court
held that the act of the superintendent was not judicial, it felt obliged to decide that certiorari
could not issue. If on the other hand it held that his act was judicial, it would strip him of a
series of most valuable powers; since the ccnsti- tution declared that none but judicial officers
should exercise judicial powers, and the superintendent was evidently not a judicial officer in
the sense of the constitution. The court, however, was equal to the occasion and succeeded in
avoiding both horns of the dilemma. It declared that the act in ques- tion, while not absolutely
and purely judicial in the sense of the constitution, was yet quasi-judicial -judicial enough to
permit the issue of the writ to the superintendent in a proper case. What was really meant by
the opinion was that the act of the superintendent, from the point of view of the principle of
the separation of governmental powers, was an administrative act of a discretionary
character.5 A very late case6 in New York, finally, has accepted the Wisconsin point of view,
practically reversing the case of People vs. Board of Health,7 cited above. The court holds,
though without citation of authorities, that an order of a board of health may be quashed on
certiorari, because the duties discharged by boards of health are quasi-judicial. 1 Preble vs.
Portland, 45 Maine, 24I. 2 Ewing vs. City of St. Louis, 5 Wallace, 413. 8 Flint vs. Fond du
Lac, 42 Wis. 287. 4 Gaertner vs. Fond du Lac, 34 Wis. 496. 5 State vs. Whitford, 54 Wis.
I50. Same principle: State vs. Dodge Co., 56 Wis. 79. 6 People vs. Board of Health, I2 N. Y.,
Supplement, 56i. 7-20 How. Pr. 458. This content downloaded from 49.36.62.118 on Tue, 21
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OF CERTIORARL. 513 In view of the above decisions we may safely say, notwith- standing
the difficulty experienced by the courts of some of our commonwealths in reaching a
satisfactory solution of the question, that the use of the certiorari is not confined to the review
of judicial acts; that the writ is applicable in numerous cases where private rights are
prejudiced by administrative decisions; and that it furnishes the chief means of subjecting the
acts of a host of administrative authorities to the control of the courts. In detail it has been
held that certiorari lies to justices of the peace,' supervisors,2 county commissioners,3
commissioners to assess damages,4 assessors," commissioners of highways in many cases,6
and municipal councils and depart- ments.7 Not only may certiorari be employed to review
administrative decisions, but there is a tendency to limit its use to such cases. At common law
certiorari was used to review the decisions of bodies exercising real judicial powers, i.e.
bodies which decide controversies ; 8 but at the present time in the United States the tendency
is to provide some other means of appeal against the action of purely judicial bodies and to
confine certiorari - i.e. certiorari to review a determination - to the action of bodies mainly
administrative in character. Thus the New York codes of civil and criminal procedure abolish
certiorari to review a de- termination in a civil or criminal action by a judge or a court of 1
Rex vs. Inhabitants of Glamorganshire, I Ld. Raymond, 580; Little vs. Cochran, 24 Me. 509.
2 People vs. Supervisors, 5i N. Y. 442. 8 Bangor vs. County Commissioners, 30 Me. 270;
Gibbs vs. Hampden, I9 Pick- ering, 298. i Ex Eparte N. J. R.R. Co., i6 N. J. L. 393. r People
vs. Assessors of Albany, 40 N. Y. 154. 6 Commonwealth vs. Coombs, 2 Mass. 489; Lawton
vs. Commissioners, 2 Caines (N. Y.) 179. 7 Stone vs. Boston, 2 Metc. 220; Camden vs.
Mulford, 26 N. J. L. 49; People vs. Mayor, &c., 9 Barb. 535; People vs. Rochester, 2I Barb.
656 (this case shows a tendency to depart from the original New York rule); Whitney vs.
Board of Dele- gates, I4 Cal. 479. 8 E.g. see Bacon's Abridgment, title Certiorari, B. Reardon
vs. Guy, 2 Hayward (N. C.) 433; John, a Slave vs. The State, I Ala. 95; Ex parte Couch, 14
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[VOL. VI. record, and provide for an appeal.' In New York, accordingly, certiorari to review
a determination has been specialized into a means of appeal against the action of
administrative officers- the very purpose for which the courts at first refused to em- ploy it.
Nevertheless, the writ cannot be used against all officers of the administration. It may not be
employed to review the decision of a mere ministerial officer 2 nor the acts of the chief
executive of the nation or of a commonwealth.3 V. Province of the WYrit. The change above
outlined in the use of the writ has carried with it a change in its purpose or province. In order
to under- stand the province of the certiorari to review a determination, it is necessary to bear
in mind the rules of the English law regard- ing appellate proceedings in general; and first of
all the distinc- tion between appellate proceedings at law and in equity. Equita- ble appellate
proceedings, such as "appeals " technically so called and " review," brought up before the
appellate court the whole matter in controversy, including questions both of law and of fact,
to be tried anew as if the case had never been tried before. Appellate proceedings in law, as
distinguished from equity, con- sisted of the writs of error and certiorari, and brought up for
review only questions of law. Among the questions of law upon which appeal might be taken
was the question as to the existence in the proceedings of those facts which the law requires
to exist in every case in order that there may be no error in law; such, for example, as the fact
that the defendant in the suit had been served with process.4 The historic basis of this
distinction between appellate proceedings at law and in equity is probably to be founid in the
fact that, at the time when the jurisdiction of the royal law courts was developed, the influ- 1
N. Y. Code of Civil Procedure, sec. 2121; N. Y. Code of Criminal Procedlure, sec. 5I5. See
also, on the general principle, Baylies' New Trials and Appeals, p. 17. 2 People vs. Walter, 68
N. Y. 403, 410. 3 People vs. Hill, I3 N. Y. Supplement, I86; Law _7ournal, April I3, I89I;
affirmed by the Court of Appeals but not yet reportel. 4 Powell, Appellate Proceedings, pp.
44 seq. This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All
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of the popular courts was stronger than at the time of the development of the court of
Chancery. In the popular courts questions of law and of fact were both decided by the people.
With the development of the royal law courts, the decision of questions of law fell into the
hands of the judges, but the decision of questions of fact was left with the representatives of
the people, or, later, the jurors. But when the court of Chan- cery was formed, the balance of
influence had so far shifted from people to King that the King was able to invest the
Chancery judges with power to decide all questions, whether of law or of fact. Appeals in
both cases naturally brought up only those questions which had been decided by the judges
from whose decision the appeal was taken: in the one case, only questions of law; in the
other, questions both of law and of fact. Certi- orari and error were therefore from the
beginning means of appealing upon questions of law alone. The great difference between the
writ of certiorari and the writ of error was that the writ of error was issued to tribunals having
full common-law jurisdiction, courts which decided con- troversies; while certiorari was
issued to tribunals not acting in accordance with the common law, i.e. tribunals of limited
jurisdiction - jurisdiction granted by statute and largely admin- istrative in character.' This
fact had great influence on the original province of the writ of certiorari to review a
determina- tion. The most important authorities to whom the writ was originally issued (viz.
the justices of the peace) did not so much decide controversies as administer government.
Their most important duties, the exercise of which the court of King's Bench was most
frequently called upon to review on certiorari, consisted in deciding questions of fact and
expediency. Unlike the courts of general common-law jurisdiction, they had not to establish
and develop the rules of the substantive law; they had simply to apply the established rules to
what they found to be the facts of each case. Of course the application of legal rules involves
their interpretation, and, equally of course, it was possible for these courts to misinterpret the
substantive law; 1 See supra, P. 505. This content downloaded from 49.36.62.118 on Tue, 21
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SCIENCE QUARTERLY [VOL. VI. but the main questions of law which they determined
(and had to determine in order to act at all) concerned their competence, and their most
frequent errors on points of law consisted in overstepping their competence, i.e. in excess of
jurisdiction. Now in the theory of the English law the decision of a court of limited
jurisdiction in excess of jurisdiction is absolutely void. In pure theory, therefore, there was no
need of providing any means of appeal from such decisions in excess of jurisdiction; since
they were void, they could always be impugned collater- ally. In practice, however, it was
clearly inconvenient to have the validity of a decision tested in this way. Not only would it be
unfair to give to the individual no remedy except the right to refuse to obey the void order or
decision and, on prosecution, to allege collaterally its illegality and invalidity,' but it would
take up altogether too much of the time of the ordinary courts to oblige them to examine,
whenever the claim of invalidity might be raised collaterally, whether all the provisions of the
law giving jurisdiction had been complied with. Accordingly we find that from an early
period the acts of the most important of these authorities of limited jurisdiction, not
proceeding in accordance with the common law (viz. the justices of the peace), were treated
collaterally in much the same way as the acts of the ordinary courts of common law and
general jurisdiction. Thus, in the case of Rex vs. Venable 2 the court said: " We will not
presume that they acted unlawfully." But if the collateral attack was refused, a means of
direct attack must be furnished. Therefore from an early time the certiorari was made use of
to quash an act that was admittedly void. The most instructive of the early cases on this point
are those of Rex vs. Inhabitants of Glamorganshire,3 known as the Cardiff Bridge case, and
Groen- welt vs. Burwell.4 In the first the question was as to the pro- priety of the issue of the
certiorari to justices of the peace to 1 Cf Justinian's Codex, 2, 40, 5, I: Melius . . . est intacta
jura . . . servari quam post causam vulneratam remedium quaerere. 2 I Strange, 630. See also
Rex vs. Cleg, I Strange, 475, and note to 7 T. R. 633, where it was held that a conviction by a
justice could not be impeached collaterally any more than the judgment of a court of general
jurisdiction. Cf Freeman, Judg- ments (3d ed.), secs. I22, 520. 3 I Ld. Raymond, 580. 4 Ibid.
454, 46 This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All
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for excess of jurisdiction, their action in ordering money to be levied for the repair of Cardiff
bridge. Objection was made to the issue of the writ on the ground that it was not necessary;
since if the justices had proceeded according to the statute there was no reason to remove
their order into the royal court, but if not, then what they did was coram non judice and void
and parties might examine the legality of the proceedings collater- ally in an action. But the
court held that it would examine the proceedings of all jurisdictions erected by act of
Parliament; and if under pretence of such an act they proceeded to encroach jurisdiction to
themselves greater than the act warranted, the court would send a certiorari to them to have
their proceedings returned there, to the end that the court might see that they kept themselves
within their jurisdiction and if they exceeded it to restrain them. In Groenwelt vs. Burwell it
was said that by common law the court would examine by certiorari if other courts
proceeding not in accordance with the common law exceeded their jurisdiction.1 Thus,
notwithstanding the general theory concerning void acts, the decision of the question of
jurisdiction was originally the province of the writ of certiorari to review a determination; and
the fact that the act to be reviewed was void was no bar to the issue of the writ. This rule
seems to have been adopted in this country. Judge Savage of New York said: "There are
many cases in our reports of justices' judgments reversed where they were utterly void." 2
Again, in Fitch vs. Commissioners,3 the court said that the fact that an order is void does not
preclude the party from treating it as voidable4 and bringing certiorari to quash it.r 1 See also
Rex vs. Morley, 2 Burrows, I040, where it is said that " a certiorari goes to see whether a
limited jurisdiction have exceeded their bounds." 2 Starr vs. Rochester, 6 Wendell, 564, 567.
8 22 Wendell, 132, 135. 4 The reasoning here is confused. The law may, and in fact every
system of law does, provide in certain cases for a judicial declaration that a void act is void.
This is the purpose of the French action en nulliti and of the German Nichtigkeitsklage. The
English law has inherited from the canon law a similar procedure in the case of a marriage
void ab initio. The fact that a distinct form of procedure is provided to test the question of
nullity does not turn the void act into a voidable act; and in such cases it is inexact and
confusing to say even that the void act is " treated as voidable." 6 See Stone vs. Mayor, etc.,
25 Wendell, 157, I68, with cases cited; Swann vs. This content downloaded from
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Jurisdiction depends, however, according to the courts, upon the existence of two classes of
facts. In the first place the law must have given the power to act in the case. In the second
place the formalities laid down by the law must have been fol- lowed by the authority doing
the act; and even if the law does not expressly indicate the formalities to be complied with,
still the courts have always insisted upon the doing of certain things in order that the legal
proceedings may be regarded as valid. In other words the proceedings must be regular, in
order that an authority may be said to have acted within its jurisdiction. The question of
regularity of proceedings is thus made a part of the general question of jurisdiction. Still,
many of the decis- ions, among which may be mentioned not a few of those above cited,' treat
this latter question as a distinct one, and state that certiorari brings up not only the question of
jurisdiction, but also that of the regularity of the proceedings.2 But this was all that the
certiorari originally brought up for review. Case after case may be cited to indicate how
unwilling the courts were to allow any other questions than those pertaining to the matter of
jurisdiction to come up before them on certiorari. They refused for a long time to consider
errors upon points of law except where these affected the question of jurisdiction.3 They have
time and time again refused to look beyond the record; 4 they have decided that, when the
case brought up turned upon the decision of a question of fact, they would not interfere,5 -
would Mayor, 8 Gill (Md.) 150; Doolittle vs. R. R. Co. I4 Ill. 38I; People vs. Williamson, I3
Ill. 660; R. R. Co. vs. Whipple, 22 Ill. I05; Jeffers vs. Brookfield, i N. J. L. 38, and Ex parte
Buckner et al., 9 Ark. 73. In both these last cases the court speaks expressly of quashing void
acts. 1 See particularly Brooklyn vs. Patchen, 8 Wendell, 47; Swan vs. Mayor, 8 Gill (Md.)
150. 2 The most common irregularity seems to be failure to give proper notice. This, the
courts hold, is sufficient cause to quash the action of administrative authorities on the ground
of common right. Fonda vs. Canal Appraisers, i Wendell, 288; 15 John- son, 537;
Commissioners vs. Chase, 2 Mass. 270; Commissioners vs. Peters, 3 Mass. 229; State vs.
Barnes, 8 Me. 135, 137; Ottawa vs. R. R. Co., 25 111. 43. 3 King vs. Whitbread, 2 Douglas,
549,553, 555; Birdsall vs. Phillips, I17 Wendell, 464. 4 Wood vs. Tallmann, I N. J. L. I53;
Starr vs. Rochester, 6 Wendell, 564, 566; Farley vs. McIntire, I3 N. J. L. I90; Andrews vs.
Andrews, I4 N. J. L. I41. 5 State vs. Senft, 2 Hill (S. C.) 367, 369. This content downloaded
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verdict or decision was against evidence,' nor consider the credibility of witnesses.2 On this
account the return to the writ when issued did not bring up the evidence as a part of the
record.3 The only clear exception to this limita- tion of the province of the writ was to be
found in the case of summary convictions before justices, where the courts held that errors of
law other than those on the question of jurisdiction were reviewable; that the question of fact,
whether the convic- tion was supported by the evidence, might be examined; and that, in case
the courts of review found that the conviction was totally unsupported by the evidence, they
might quash it.4 The reason of this exception is to be found in the necessity of estab- lishing
an effective control by officers of a really judicial charac- ter in cases involving individual
liberty. The justices, as we have seen, were administrative rather than judicial officers; and in
these cases of summary convictions the justices acted without a jury and in a manner which
was at variance with the usual rules of the English criminal law relative to convictions. In
these cases of summary conviction, where the province of certiorari was wider than in other
cases, - where it served to review both the law applied and the evidence adduced, - the usual
rule was to send up to the court of review the evi- dence as well as the record. Further, there
are a few English cases which apply the same rule to facts affecting the jurisdiction. A series
of cases have held that the action of justices who were in the slightest degree interested might
be quashed on certiorari. In fact one of the fundamental rules in regard to jurisdiction has
always been that aliqitis non debet esse judex in propria sua causa.5 In some of these cases
the interest which forfeited jurisdiction had to be 1 Nightingale, petitioner, xi Pickering, i68;
Baldwin vs. Simmons, 9 N. J. L. I96. 2 Independence vs. Bompton, 9 N. J. L. 209. 3 Canal
Co. vs. Keiser, I9 Pa. St. I34. 4 King vs. Smith, 8 T. R. 588; Rex vs. Killett, 4 Burrows, 2063;
Rex vs. Vipont, 2 Burrows, II65; Rex vs. Theed, 2 Strange, 9g9; People vs. Miller, 14 Johns.
371. 5 See, e.g., In re Hopkins, E. B. & E. xoo; Regina vs. Allen, L. R. I Q. B. 120. This
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delhors the record. Thus a conviction for violation of the by-law of a railway company was
quashed because some of the justices were shareholders in the company.' The tendency in this
country to separate the administration of justice from the administration of government has
resulted in making the justices of the peace almost exclusively judicial officers. Their original
judicial powers, which were mainly of a criminal character, have been increased by statutes
which have given them quite an extensive jurisdiction in minor civil cases. But as they
retained the character of courts of limited jurisdiction, not proceeding according to the
common law, their acts were reviewed not by writ of error but by certiorari; and as the
questions which could be reviewed on certiorari were, as has been shown, simply the
questions of jurisdiction and regu- larity of proceedings, their mistakes of law in civil suits
could not be corrected without extending the province of the certiorari and making it as
liberal as the writ of error.2 Such an exten- sion of the province of the writ accordingly
appeared in these civil cases. It seems to have gone hand in hand with the extension of the
civil jurisdiction of the justices, and to have been accomplished by the courts almost
unconsciously. Thus a judgment of justices of the peace in a civil case in Maine was quashed
on certiorari because the justices had not required the debtor to make a full discharge of his
property as required by law.3 Here the ground of the quashing of the judgment, as stated by
the court, was that after refusing the just demand of the creditor the justices' subsequent
action was not warranted by law and they therefore had not jurisdiction. In another case the
judgment of the justices was quashed on certiorari because they had refused to allow the
creditor to make an examination of a debtor which the law permitted.4 In- spite of some
conflict 1 Regina vs. Allen, L. R. I Q. B. 120. See also People vs. Goodwin, 9 N. Y. 568;
People vs. Wheeler, 2 N. Y. 82. 2 The province of the writ of error was enlarged in the time
of Edward I. 8 Dow et al. vs. True et al., I9 Me. 46. 4 Little vs. Cochran, 24 Me. 509. See
also on this point State vs. Stuart, 6 Stroh- bart L. (S. C.) 29; Hayward, petitioner, io
Pickering, 358; Buckmesser vs. Dubs, 5 Binney (Pa.) 29. This content downloaded from
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same rule has been established in New York. It has been decided that, in purely civil cases-
i.e. in controversies between individuals in regard to purely private rights - the court of
review may on certiorari quash the action of the lower tribunal, not only where it has
exceeded its juris- diction or where its proceedings have been irregular, but also where it has
made a mistake in the application of principles of law to the particular case; and that, in order
to enable the court of review to do this, the lower court must on the return to the writ send up
whatever evidence is necessary to enable the higher court to reach its decision. These
principles may be regarded as settled by the case of Morewood vs. Hollister,2 decided in
1852, in which all the other cases were reviewed and the doctrine as stated -viz. that the court
of review may quash the act of the lower court for error in law - was fully and unqualifiedly
adopted. But the case of Morewood vs. Hollister went a step farther. It decided to apply in
these cases the rule which had from time immemorial been applied to cases of sum- mary
convictions; viz. that the court of review might quash the decision of the lower tribunal if this
decision appeared to be absolutely unsupported by the evidence. In the case at bar it decided,
on the evidence which it permitted to be sent up, that the lower court had erred in deciding "
that the insolvent had in all things conformed to the matters required of him by stat- ute and
that he should be discharged from his debts." Up to the time when this case was decided
(1852) we find few if any decisions enlarging the province of the writ when applied to the
decisions of administrative as distinguished from judicial authorities. One case, indeed, had
claimed for the court of review the right of quashing the decisions of administrative
authorities for errors of law. This was the case of Baldwin vs. Calkins,3 in which the court
quashed the act of assessment com- 1 Matter of Wrigley, 4 Wendell, 602, and 8 Wendell, I34;
Anderson vs. Prindle, 23 Wendell, 6I6. See also Roach vs. Cosine, 9 Wendell, 227; Brown
vs. Betts, I3 Wendell, 29 (which permitted the introduction of evidence and discussed its
weight); Brooklyn vs. Patchen, 8 Wendell, 47. But see Simpson vs. Rhinelander, 20 Wen-
dell, 103 which held to the old view. 2 6 N. Y. 309. 3 io Wendell, I67. This content
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missioners on the ground that in assessing damages they had made use of a wrong principle
of law. But in People vs. Good- win,' the contrary view was taken. It was said that where the
authority and jurisdiction depends upon a fact to be proved and such fact is disputed, the
magistrate must certify the proofs given in relation to it for the purpose of enabling the higher
court to determine whether the fact be established. The decision of the magistrate in relation
to all other facts is final and conclusive and will not be reviewed on a common law certiorari.
But the main object of this writ being to confine the action of inferior officers witlhin the lim-
its of these delegated powers, the reviewing court mnust necessarily re- examine, if required,
the decision of the magistrate on all questions on which his jurisdiction depends, whether of
law or of fact. The disputed jurisdictional fact in this case was whether the owner of a
building situated on land through which a road was to run had given his consent to the laying
out of the road as fixed by the commissioners, the consent being necessary to the jurisdiction
of the commissioners. While the statement of the principle in this case is quite narrow, it will
be noticed that the decision itself is quite in line with the decisions discussed in the preceding
paragraph. A similar case is People vs. Van Al- styne,2 where facts in regard to jurisdiction
were permitted to be brought up on certiorari. The more liberal principle, how- ever, was not
yet established, as may be seen from the next case in point, viz. People vs. Wheeler.3 This
held that the main inquiry on certiorari relates to the power and jurisdiction of the inferior
tribunal, and the question can only be determined by matters appearing in the record. When
an examination into collateral facts, not properly appearing in the record, is desired, to shiow
want of power or jurisdiction, the appropriate remedy is not by certiorari. In this case the
attempt was made to show dehtors the record that the officer whose decision was attacked
was the brother of one of the parties concerned in the proceeding. This the court refused to
allow, notwithstanding that it was claimed that proof of the relationship, if admissible, would
have an important bearing on the question of jurisdiction. This claim was not 1 5 N. Y. 568. 2
32 Barb I3T. 3 2I N. Y. 82. This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020
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CERTIORARI. 523 fully admitted by the court. The next case is still stronger in favor of the
narrow rule. This is the case of People vs. High- way Commissioners,' in which the court says
distinctly that the office of certiorari is merely to bring up the record of the proceeding to
enable the Su- preme Court to determine whether the inferior tribunal has proceeded within
its jurisdiction and not to correct mere errors in the course of the proceeding. Here the object
seems to bring into review the alleged erroneous rulings of the jury in receiving or rejecting
evidence offered on the hearing before them, as though it were a bill of exceptions. Such
questions do not arise and cannot be reviewed on certiorari. The opinion is based on the case
of Birdsall vs. Phillips 2 which was one of the narrowest of the old cases and had been
reversed so far as the purely civil cases were concerned. But the application of the broader
rule to the decisions of judicial bodies could not fail to have an influence upon the courts in
their review of the decisions of administrative author- ities. The first case, however, which
comes out definitely for the application of the same rule to administrative decisions is Swift
vs. Poughkeepsie,3 which contains, in a dictum, a dis- tinctly liberal statement of the
province of the writ. This was an action against a city to recover taxes paid, on the ground
that the assessment was erroneous. The court held that the action did not lie. The acts of the
assessors could not thus be impeached collaterally. The plaintiff, it was said, should have
availed himself of his remedy by certiorari to declare the assess- ment void. The judge says:
The plaintiff denies the efficiency of this remedy upon the ground that upon a certiorari the
court will only consider the question of juris- diction, and that in this case if the court found,
as it would upon the doctrine now proclaimed, that the assessors had jurisdiction, their
determination as to the legality of the taxes could not have been reviewed. It is true that this
has been the doctrine of the courts to a considerable extent, upon what ground, either of
principle or of neces- sity, I never could very clearly comprehend. But I think, at this time a
more liberal rule would and should be applied; and that a certiorari 1 3o N. Y. 72. 2 I7
Wendell, 464. 3 37 N. Y. 5i Y. This content downloaded from 49.36.62.118 on Tue, 21 Jul
2020 06:41:25 UTC All use subject to https://about.jstor.org/terms 524 POLITICAL
SCIENCE QUARTERLY. [VOL. VI. would not bring the naked question of jurisdiction, but
the evidence on which the body acted to which the writ was directed as well as the ground or
principle of their action, and thus present the whole case for review and if necessary for
correction.' While such expressions of opinion as this have not the author- ity of decided
cases, still they show the leaning of the courts; and shortly afterwards we find a case which
definitely applies to the decisions of administrative bodies the same rule which had been
worked out previously with so great trouble and through so much conflict for the decisions of
purely judicial bodies. This was the case of People vs. Board of Police,2 which decided that
the court might review the decision of a board of police dismissing a policeman from office,
and might reverse the decision if it was, in the opinion of the court, absolutely unsupported
by the evidence. Judge Woodruff says: I cannot resist the belief that a disposition has been
manifested to limit the office of this most useful writ within too narrow limits. Let it once be
established that where an officer or board of officers have jurisdiction of the subject or of the
persons to be affected and proceed in its exercise according to the prescribed mode or forms,
their deter- mination is final and beyond the reach of any review, whatever errors in law they
may commit and however clear it may be upon undisputed facts that their judgment, decision
or order is not warranted - and there is danger that much injustice and wrong may happen
without possibility of redress. . . . It may be desirable not to multiply cases in which appellate
courts can be called upon to interfere in matters of small importance, but that furnishes no
reason for denying the power to see that the rules of law are not violated, when wrong is
done, and no great public inconvenience will result from its exercise. I conclude . . .that on
this appeal this court have power to examine the case upon the whole of the evidence to see
whether, as a matter of law, there was any proof which would warrant a conviction. . . . If
there was no evidence . . . if the case were such at the close of the trial that it would have
been erroneous to submit the question to a jury, were a like ques- tion before a jury in an
ordinary action - then the error is an error of 1 See also, to the same effect, Baldwin vs.
Buffalo, 35 N. Y. 380, which makes the same intimation and which is approved in the case
just cited. The case of Baldwin vs. Buffalo also intimated that if the evidence returned
showed that the decision of the lower tribunal was incorrect, i.e. was absolutely unsupported
by the evidence, that the higher court could correct it. 2 39 N. Y. 5o6. This content
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conviction is illegal; it rests upon no finding of facts upon evidence tending to sustain such
finding; but as matter of law the relator was entitled to be acquitted of the charge [page 517].
This liberal rule was followed in the case of People vs. Asses- sors,1 and in People vs.
Smith,2 decided in i871. In this last case Judge Grover says: Whatever may have been the
conflict of authority upon the question whether, upon a common-law certiorari, the court can
inquire into any- thing beyond the jurisdiction of the tribunal over the parties and subject
matter, it must now be regarded as settled in this state, that it is the duty of the court in
addition thereto to examine the evidence and deter- mine whether there was competent proof
of facts necessary to authorize the adjudication made, and whether in making it any rule of
law affecting the rights of the parties has been violated [page 776]. Such is the history of the
development of the office of the writ of certiorari, as taken particularly from the cases
decided by the courts of New York. It may well be asked why the courts so long
distinguished between the province of the writ as a means of reviewing the decisions of
purely judicial bodies and its province as a means of reviewing the decisions of admin-
istrative bodies, and why the courts enlarged the province of the writ in the one case without
enlarging it in the other. The answer is that the ordinary civil jurisdiction given to tribunals
not acting in accordance with the common law, i.e. to courts of limited jurisdiction, was
given as a result of the separation of judicial from administrative functions; that the writ of
certio- rari had always been chiefly used in administrative cases, since administrative cases
formed the majority of the cases which were decided by these courts of limited jurisdiction;
that with the transfer to them of more purely judicial duties the need was felt of reviewing
their decisions on such matters, and a method of appeal had to be provided which should
accomplish the same results as the writ of error in judicial cases, and the certiorari in the case
of summary convictions. Finally, in most of the cases in which judicial duties were conferred
upon these courts I40N. Y. 154. 245 N. Y. 772. This content downloaded from 49.36.62.118
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POLITICAL SCIENCE QUARTERLY. [VOL. VI. of limited jurisdiction, the statutes
granting the jurisdiction provided expressly for an appeal from their decisions by certio- rari;
and the wording of the statutes was such that the courts felt justified in applying to this "
statutory certiorari," as they called it, rules more liberal than those which had been estab-
lished touching the common-law certiorari. This comes out quite clearly in the case of
Morewood vs. Hollister.' The stat- ute granting the certiorari in this instance provided for a
review of the " proceedings." This word the court interpreted to mean "all matters connected
with or attending the exercise of the power which are necessary to enable the court of review
to de- termine its validity or correctness." The more liberal rule once established with regard
to this statutory certiorari, it was an easy matter to liberalize the office of the common-law
certio- rari. And fortunate it was for individual rights that this means of development was
offered to the courts before the certiorari was confined, as it is now coming to be, to the
review of the decisions of purely administrative tribunals. For we are justi- fied in
concluding, from the difficulty which the courts found in enlarging the province of the
common-law certiorari even with the aid of the statutory certiorari, that without it the cer-
tiorari would have remained, in New York at any rate, as nar- row a remedy as it was under
the common law. While New York had thus the greatest difficulty in enlarging the province
of the writ, New Jersey, it would seem, took a much more liberal view of its use from the
beginning. As early as 1839 we find the New Jersey courts holding that the proceedings of
administrative bodies might be quashed on cer- tiorari for an erroneous application of
principles of law.2 The broader rule as to the province of the certiorari, which had been so
laboriously evolved by the New York courts and which offered to individual rights so
important protection against the arbitrary action of the administration, the people of New
York decided to sanction by statute; in order, in the words of Mr. Throop,3 " to prevent the
possibility of re-opening the ques- 1 6 N. Y. 309. 2 N. J. R. R. Co. vs. Suydam, 2 Harrison,
25. 3 In his note to sec. 2140 of the New York Code of Civil Procedure. This content
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https://about.jstor.org/terms No. 3.] THE WRIT OF CERTIORARI. 527 tions thus decided,1
and to declare definitely that the cases hold- ing the other way were obsolete." Section 2140
of the code, which is simply declaratory of the New York common law as then understood,
provides that in addition to the questions of jurisdiction, regularity of proceedings and errors
of law, the court may decide whether there was any competent proof of all facts necessary to
be proved in order to authorize the making of the determination; and, if there was such proof,
whether there is upon all the evidence such a preponderance of proof against the existence of
any of the facts that the verdict of a jury in affirmation thereof, rendered in an action in the
Supreme Court triable by jury, would be set aside by the court as against the weight of
evidence. The meaning of this section is shown to be identical with the common-law rule
adopted before the passage of this section, by the cases of People ex ref. Hogan vs. French,2
and People ex rel. McAleer vs. French,3 which hold that the Supreme Court may reverse the
decision of the subordinate tribunal only where it is absolutely unsupported by proof. If there
is any proof at all to support the decision it will be upheld, as the court will not determine the
preponderance of proof. The New York rule as to the province of certiorari has been adopted
in Michigan in People vs. Jackson.4 Judge Cooley, who rendered the opinion of the court,
seems to think that in permitting errors of law outside of jurisdictional ques- tions to be
reviewed on certiorari the court is not extending at all the province of the writ of certiorari at
common law. He regards the early rule in New York, in accordance with which only the
record was returned and only jurisdictional questions considered, as not supported by the
early English cases; and in order to show that evidence dehors the record might originally be
returned he cites a series of cases. Most of these on exami- nation turn out to be cases in
which summary convictions were being examined; and it will be remembered that in these
cases 1 I.e. by People vs. Smith, 45 N. Y. 772, the last case on the point before the pas- sage
of this section. 2 II9 N. Y. 493. 8 II9 N. Y. 502. 4 9 Mich. III, followed in Hyde vs. Nelson, II
Mich. 353, 357. This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25
UTC All use subject to https://about.jstor.org/terms 528 POLITICAL SCIENCE
QUARTERLY. [VOL. VI. the New York practice was to require the return of the evi- dence
and to quash the conviction if not supported by the evidence. The only cases cited by Judge
Cooley which do not relate to summary convictions and which are in point simply prove that
on certiorari jurisdictional facts should be returned and considered - which was the rule in
New York, as is shown by the case of People vs. Goodwin.' That in England the pur- pose of
the certiorari was not to correct mistakes of law may be seen from the decision in the case of
King vs. Justices,2 where the court held the contrary view and where Lord Tenterden said:
The late decisions establish, however, that we cannot assume to our- selves the jurisdiction of
a court of error and revise the judgments of the court of Quarter Sessions. . . . Assuming the
judgment to be erroneous, I think we have not jurisdiction as a court of error to review it.
Judge Cooley further argues that the old English rule must have been the liberal one from the
fact that in those cases where the statute has shut out the certiorari, which of late years are
very common, the court may still issue it to review the question of jurisdiction. This is
undoubtedly true. But it must be remembered that from the beginning the purpose of the writ
of certiorari was to review the regularity or irregularity of proceed- ings as well as the naked
fact of jurisdiction; and this question of regularity of proceedings is really what the various
statutes forbidding certiorari have shut out from review. This may be seen from the case of
Exparte Hopwood,3 in which the judge says: The certiorari is taken away, so we cannot
interfere unless they [the justices] have acted altogether without jurisdiction. . . " But the
ques- tion now is whether we can review the mode in wlhich they have exer- cised their
jurisdiction. The point decided in the case was that the mode in which the subordinate
tribunal had exercised its jurisdiction could not be reviewed. 1 5 N. Y. 568. 2 8 Barn. &
Cress. I37. 83I5 Ad. & El. N. S. 121. This content downloaded from 49.36.62.118 on Tue, 21
Jul 2020 06:41:25 UTC All use subject to https://about.jstor.org/terms No. 3.] THE WRIT
OF CERTIORARI. 529 The liberal New York rule has been adopted also in Wiscon- sin.
This has been done partly by statute, providing for a statutory certiorari or an appeal from the
judicial acts of the justices; and partly by judicial decision, as regards proceedings of a
summary character and out of the course of the common law, i.e. administrative decisions.
The case of Iron Co. vs. Schubel, Town Clerk,' decided in I872, holds that mistakes and
errors of law may be corrected on certiorari.2 The better rule at the present time, as derived
from these decisions, is that the province of the writ of certiorari is to quash the decision of a
subordinate administrative tribunal: first, because it has exceeded its jurisdiction; second,
because it has not followed the formalities required by law; and third, because it has made an
error in the application of a principle of law to the case at bar -among which errors of law is
to be included the finding of a fact unsupported by evidence. And to the end that the court of
review may decide these points, it is necessary that the lower court send up in addition to the
mere record all facts which are material, especially the evidence. But this liberalizing of the
old rule does not mean that the courts will control by means of certiorari the discretion of the
subordinate tribunal whose acts are reviewed. The courts do not allow the subordinate
tribunal so to make use of its dis- cretion as to come to a decision which is absolutely
unsupported by evidence; but so long as its discretion is not thus abused, the courts as a
general rule will refuse to control it in any way. One of the first cases in New York which
attempted to enlarge the province of the writ 3 held that, while the decision of the lower
authority might be quashed on the ground that it had ap- plied a wrong principle of law, -in
this case it had assessed damages on a wrong principle, - still the assessment of dama- ges as
to amount by the lower authority was absolutely conclu- sive and could not be changed by the
court on certiorari. A 1 29 Wisc. 444. 2 See also State vs. Supervisors, 24 Wisc. 286; State
vs. Whitford, 54 Wisc. I50. 3 Baldwin vs. Calkins, I0 Wendell, I67. This content downloaded
from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All use subject to
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principle was laid down in a considerably later case,' where it was said that the justice or
injustice of an assessment for local improvements could not be examined on certiorari. The
same principle, viz. that the discretion of lower authorities may not be controlled by the
courts on certiorari, has been established in other commonwealths. In the case of Hayward,
Petitioner,2 the court, although it permitted the evidence to come before it in order that it
might ascertain whether a correct principle of law had been applied, said that it would not
reverse the decision of the justices on the ground that the evidence did not warrant such a
decision; since "that was a matter submitted by the statute to their judgment, and we cannot
revise their decision upon it." In the case of Borough of Sewickly,3 the court held that the
soundness of the discretion of an authority in incorporat- ing a borough is not subject to
review on certiorari. In Com- missioners' Court vs. Banne,4 it was declared that "upon the
question of the expediency of opening or altering a public road the commissioners' court
exercises a quasi-legislative power and its decision is not reviewable." The same principle
has been applied by the courts of New York to the question of the assess- ment of property
for purposes of taxation.5 In the case of People vs. Trustees 6 Judge Earle said: The statute
makes them [the assessors] the judges of the value of the property for the purposes of
taxation. They are required to exercise their judgment as to its value, notwithstanding any
proof that may be produced before them, and the case would be a very extraordinary one
which would authorize the Supreme Court upon certiorari to review their judgment. Indeed, it
would be quite impracticable in most cases for the Supreme Court upon certiorari to correct
the judgment of the asses- sors as to value, and my attention has been called to no such case.
It is pretty clearly the rule, therefore, that the courts will not on certiorari control the
discretion of subordinate authorities. But for various reasons this rule has become
unsatisfactory to 1 People vs. Brooklyn, 4 N. Y. 419 (185I). See also Le Roy vs. Mayor, 20
Johns. 430. 2 I0 Pickering, 358. 8 2 Grant's Cases (Pa.) 135. 4 34 Ala. 464. 5 For the general
principle as to assessments see Cooley, Taxation (2d ed.), p. 757. 6 48 N. Y. 390. This
content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All use subject to
https://about.jstor.org/terms No. 3-] THE WRIT OF CERTIORARI. 531 the individuals
whose interests are affected by these discretion- ary administrative decisionis. The chief
cause of dissatisfaction is to be found in the great number and relative irresponsibility of the
administrative authorities that have sprung up in this country as a result of the separation of
the administration of gov- ernment from the admilnistration of justice. Under the old Eng-
lish system most of the really important administrative duties were discharged either directly
by, or under the supervision of, the justices of the peace, who had obtained a well-recognized
position as judges and who, from the manner of their choice and from the high social position
they occupied, commanded the re- spect of the people and offered guarantees for impartial
and wise administration. Under the new system, which has established a host of smaller and
less important offices with no permanence of tenure, the same confidence has not been felt in
their wisdom and impartiality. Under the old system no special need was felt for the
extension of the province of the writ so that it might control the discretion of the justices.
Under the new system, however, there has been felt a need of controlling the less wise and
more arbitrary action of subordinate administrative officers. For individual rights may be
violated as well by misconception of facts and indiscretion in action as by an excess of
jurisdiction or a wrongful application of the law. A further reason for dissatisfaction is found
in the fact that there has never been in tllis country any tribunal to which appeals might be
taken from the decisions of administrative authorities as to questions of discretion and
expediency. In England the Star Chamber of the Privy Council and, after its abolition, the
court of Quarter Sessions in each county con- stituted a sort of administrative court, with
power to review the discretionary decisions of administrative authorities. In this country we
have never been able, except in rare cases, to develop any administrative jurisdiction - ie. any
judicial control over the acts of administrative authorities -except that which is to be found in
the power of the courts to issue certi- orari and other writs of a similar character, eg.
mandamus, quo warranto, prohibition and injunction, This is the only This content
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https://about.jstor.org/terms 532 POLITICAL SCIENCE QUARTERLY. [VOL. VI. relief
which our system of administration offers to the individ- ual whose rights have been injured
by administrative decisions. We find, accordingly, some indications of a tendency to ex- tend
the province of certiorari over discretionary decisions. In some cases the courts themselves,
notwithstanding their usual conservatism, have felt obliged to relax the strictness of their rule;
and in other cases the legislatures, finding that the courts were unwilling to give to the
individual the relief demanded, have come to the rescue and have by statute enlarged the
prov- ince of the writ so that the courts might on certiorari control the discretion of
administrative authorities. This movement has just begun and has not as yet attained such
dimensions as seriously to undermine the general rule. It is nevertheless worthy of careful
examination. In the first place, as I have said, the domain of administrative discretion has
been invaded by the courts themselves. The courts have held in a series of cases that, where a
statute pro- vides that an officer may be removed from office for cause only, the courts have
the right to control the discretion of the remov- ing officer in deciding what is cause.' The
courts, it is true, have not grounded their decisions on any desire to control the discretion of
administrative officers, but on the proposition that the question, what is cause, is not a
question of discretion but a question of law. But this does not alter the fact that, as a result of
these decisions, the courts do exercise a control over the discretion of administrative officers
- and that too upon a point where many think it necessary that the administration should
possess full and unlimited discretion. There are besides a few other cases in which the courts
-particularly those of New Jersey, which have taken in almost every respect a more liberal
view of the province of the writ than the courts of other commonwealths - have exercised a
direct control over the dis- cretion of administrative authorities. Thus in the case of Exparte I
Cases on this point are People vs. Board of Police, 72 N. Y. 415; People vs. Board of Fire
Commissioners, 72 N. Y. 445; State vs. St. Louis, go Missouri, 19; Stockwell vs. Township
Board, 22 Mich. 34I. See also Kennard vs. Louisiana, 92 U. S. 480. This content downloaded
from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All use subject to
https://about.jstor.org/terms No. 3.] THE WRIT OF CERTIORARI. 533 New Jersey Railroad
Co.,' it was held that the court might issue the writ to certain commissioners on the ground
that the dam- ages which they had assessed were excessive; while in Bellis vs. Phillips 2 the
court intimated that it would interfere with the judgment of the lower court on the verdict of a
jury if it were made plainly to appear that gross injustice had been done. In the second place
the legislatures have taken up the cause of the individual and have in several cases so
enlarged the prov- ince of the certiorari as to force the courts through it to control the
discretion of administrative authorities. The point in the administrative system of the United
States where the need of some control over administrative discretion is most keenly felt is in
the matter of assessments for purposes of taxation. There is no other place in the whole realm
of administrative action where the interests of the individual come into so direct conflict with
the administration, and there is no place where some remedy against unjust administrative
decisions is more needed. But, as has been shown, the almost universal rule in this country is
that administrative discretion in the assessment of property for taxes cannot be controlled on
certiorari. To meet the desire for a remedy, some of our commonwealths have created a
special statutory appeal to some court which com- mands the confidence of the people in a
higher decree than do the assessors. In New York, however, the legislature has met this
demand by enlarging the province of certiorari. By the laws of i8 9, chapter 302, section 20, it
was provided that a certiorari to review or correct on the merits any decision or action of the
tax commissioners of New York city should be allowed by the Supreme Court on the petition
of the party aggrieved. It is a significant fact that the granting of this remedy was coincident
with the introduction of paid professional assessors in place of assessors elected by the
people. In the year i 88o a similar provision was made for the entire state.3 By the statute
then passed a certiorari may issue from the Supreme Court on the petition of any person
aggrieved by the assessment, and the court may examine the questions of the illegality of the
assess- 1 i6 N. J. L. 393- 2 28 N. J. L. 125. 3 Laws of i88o, chap. 269. This content
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https://about.jstor.org/terms 534 POLITICAL SCIENCE QUARTERLY [VOL. VI. ment, its
incorrectness by reason of overvaluation, and its unfairness by reason of inequality (i.e.
because the assessment complained of is at a higher rate than assessments of other prop- erty
on the same assessment roll). If the allegations shall on the return appear to be proven, the
court may order such assess- ment, if illegal, to be stricken from the roll; if erroneous or
unequal, it may correct it so as to make it fair and equal, or it may order a re-assessment. A
somewhat similar provision has been made for the assessment of corporation taxes in New
York.' Similar provision for judicial control of the discretion of administrative officers is
frequently made in the excise laws. Such was the case with the " substitute " excise bill lately
before the New York legislature. But in these cases it is usually the discretion in refusing a
license, not the discretion in granting one, that is subjected to judicial control. As the purpose
of certiorari was originally simply to quash the action of the subordinate tribunal, the effect of
the decision of the court was usually to quash or to affirm the action ap- pealed from. Several
decisions, however, attempted to go further and in proper cases to modify or amend the
determina- tion.2 Here again, in New York, the legislature has stepped in to aid the individual
and has provided3 that the court upon hearing may make a final order, annulling or
confirming wholly or in part or modifying the determination reviewed as to any or all of the
parties. The Court of Appeals has somewhat limited the application of this section by
holding4 that this section does not give the court the right to modify the discre- tionary
decision within the jurisdiction of the lower authority. The facts in this case were that the
Supreme Court amended an order of dismissal of the board of fire commissioners by
substituting for dismissal suspension for six months. This, the Court of Appeals held, the
Supreme Court was not justi- fied by this section in doing. I See Laws of s885, chap. 501;
Laws of I889, chap. 463. 2 See People vs. Ferris, 36 N. Y. 218. 8 Code of Civil Procedure,
sec. 2141. 4 People vs. Commissioners, Ioo N. Y. 82. This content downloaded from
49.36.62.118 on Tue, 21 Jul 2020 06:41:25 UTC All use subject to
https://about.jstor.org/terms No. 3.] THE WRIT OF CERTIORARI. 535 VI. Conclusions.
The most important results obtained from this study of the development of the writ, of
certiorari in this country may be summarized as follows: (i) In order to meet the demands of a
changed administrative system, the number of authorities to which the writ may issue has
been greatly increased. In consequence, the writ has largely lost its character of an ordinary
judicial appeal and is becoming rather a means of judicial control over administrative action.
(2) The province of the writ has been greatly enlarged, so that by its means errors of law may
be corrected and decisions unsupported by the evidence may be quashed. (3) The decisions of
some of the courts and the statutes of several commonwealths show a tendency to subject the
discre- tion of administrative authorities to the control of the courts. That this development
answers modern needs and is in accord with modern tendencies is shown by even a cursory
glance at the means of judicial control over administrative action in for- eign countries. The
same impulse - namely, the desire to protect private rights against executive arbitrariness -
which has occasioned this development of the certiorari in the United States, has brought
about a considerable enlargement of the jurisdiction of the administrative courts of France
and has led to the establishment of similar tribunals in Germany-tribu- nals all of which have
sprung into existence since the middle of this century, and of which the most comprehensive
date from the foundation of the German Empire. The problem is everywhere the same; but
our solution differs in one important respect from that which has been adopted on the
continent of Europe. There the more complete realization of the principle of the separation of
governmental powers, -with its corollary, the independence of the administration over against
the judiciary, - forced the publicists to find the means of judicial control over administrative
actions in bodies not connected with the ordi- nary judiciary, and to construct, side by side
with the ordinary This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:41:25
UTC All use subject to https://about.jstor.org/terms 536 POLITICAL SCIENCE
QUARTERLY courts, a second system of administrative courts. Here we have vested the
control over the administration in the ordinary courts. Our solution of the problem differs
again from that which has been reached in England. There an ample means of control has
been found in the courts of Quarter Sessions and in the device of " stating a case " to the
ordinary law courts. We, on the other hand, have gradually remodelled one of the old
common-law writs and greatly widened its province. If the same liberal ideas which have
obtained in the imme- diate past continue to obtain in the future, it seems safe to predict that
our present writs will prove amply sufficient to protect private rights from the abuse of
administrative discre- tion, and that we shall find in our ordinary courts a more simple system
of judicial control over administrative action than that which has been adopted on the
continent of Europe. FRANK J. GOODNOW. This content downloaded from 49.36.62.118
on Tue, 21 Jul 2020 06:41:25 UTC All use subject to https://about.jstor.org/terms
--------------
The Writ of Prohibition
Source: Columbia Law Review , Apr., 1916, Vol. 16, No. 4 (Apr., 1916), pp. 338-340
Published by: Columbia Law Review Association, Inc. Stable URL:
http://www.jstor.com/stable/1110294 JSTOR is a not-for-profit service that helps scholars,
researchers, and students discover, use, and build upon a wide range of content in a trusted
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support@jstor.org. Your use of the JSTOR archive indicates your acceptance of the Terms &
Conditions of Use, available at https://about.jstor.org/terms Columbia Law Review
Association, Inc. is collaborating with JSTOR to digitize, preserve and extend access to
Columbia Law Review This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020
06:39:01 UTC All use subject to ht COLUMBIA LAW REVIEW. to regard this distinction
has resulted in treating the fees due to officers and witnesses as the debt of the contingent
loser of the suit, and not as due immediately from the party for whom the services were
rendered. The cost of litigation in this respect has consequently become needlessly expensive,
inasmuch as the expense of credit officers or witnesses naturally are more readily incurred by
a litigant than that of cash ones.15 In this country, however, while in certain instances a court
may make extra allowances of costs,16 the amount of costs recovered is generally so small
that it by no means covers the expenses of a suit.'L Still, although in their origin costs were
given as a punishment to a defeated party for causing the litigation,18 most jurisdictions to-
day consider costs, in theory at least, as compensation to a successful litigant for his expenses
incurred in the litigation.'9 In England, the costs allowed to a successful litigant are the
reasonable costs of the proceeding of such party in an action, including expenses incurred in
obtaining the assistance of solicitors and counsel, and the expenses of the various steps in the
action up to the signing of judgment.20 The taxing officer, subject to the court's direction, is
also given a very large discretion as to the amount which he may allow.21 It may therefore be
said that costs in England, unlike those in the United States, do in fact amount to a substantial
indemnity for the expenses of the suit. THE WRIT OF PROHIBITION.-The writ of
prohibition is a preroga- tive writ which at first issued only from the Court of King's Bench,
but later in some cases from the Chancery, the Court of Common Pleas, or the Court of
Rxchequer.l The injury which it remedied was that of encroachment of jurisdiction, or calling
one coram non judice. By means of this weapon the common law courts were able to assert
their supremacy over the admiralty and ecclesiastical courts, "See O'Neil v. Kansas City etc.
R. R. (C. C. 1887) 31 Fed. 663. "See N. Y. Code Civ. Proc., ? 3253; Sentenis v. Ladew
(1893) 140 N. Y. 463, 35 N. E. 650. "Henry Ex'r. v. Murphy & Co. (1875) 54 Ala. 246; see
Day v. Wood- worth, supra. Costs do not include expenses incurred preparatory to the
commencement of an action. Studwell v. Cook (1871) 38 Conn. 549. Counsel fees are not
generally included in costs. Sedgwick, Damages (9th ed.) ?229; see Jacobson v. Poindexter
(1883) 42 Ark. 97. '"Dibbin v. Cook (1735) 2 Str. *1005; see Musser v. Good, supra. This
view still prevails in a few jurisdictions. See Tillman v. Wood, supra. In Alabama the statute
declares that costs are penal. See Lee v. Smyley (1849) 16 Ala. 773. Being deemed penal,
statutes awarding costs were strictly construed, Dibbin v. Cook, supra, and this construction
is generally followed today. Veidt v. Mo. K. & T. Ry., supra; State v. Baker (1912) 35 Nev.
300, 129 Pac. 452. "Milliman, Law of Costs, ? 1; see Stevens v. Central Nat. Bank (1901)
168 N. Y. 560, 61 N. E. 904; Sommer v. Compton (1909) 53 Ore. 341, 100 Pac. 289. '23
Halsbury Laws of England 184; see Glamorgan County Council v. Gt. Western Ry. (1894) 1
Q. B. D. 21. '26 Halsbury Laws of England 797. '3 BI., Comm., *112. to regard this
distinction has resulted in treating the fees due to officers and witnesses as the debt of the
contingent loser of the suit, and not as due immediately from the party for whom the services
were rendered. The cost of litigation in this respect has consequently become needlessly
expensive, inasmuch as the expense of credit officers or witnesses naturally are more readily
incurred by a litigant than that of cash ones.15 In this country, however, while in certain
instances a court may make extra allowances of costs,16 the amount of costs recovered is
generally so small that it by no means covers the expenses of a suit.'L Still, although in their
origin costs were given as a punishment to a defeated party for causing the litigation,18 most
jurisdictions to-day consider costs, in theory at least, as compensation to a successful litigant
for his expenses incurred in the litigation.'9 In England, the costs allowed to a successful
litigant are the reasonable costs of the proceeding of such party in an action, including
expenses incurred in obtaining the assistance of solicitors and counsel, and the expenses of
the various steps in the action up to the signing of judgment.20 The taxing officer, subject to
the court's direction, is also given a very large discretion as to the amount which he may
allow.21 It may therefore be said that costs in England, unlike those in the United States, do
in fact amount to a substantial indemnity for the expenses of the suit. THE WRIT OF
PROHIBITION.-The writ of prohibition is a preroga- tive writ which at first issued only from
the Court of King's Bench, but later in some cases from the Chancery, the Court of Common
Pleas, or the Court of Rxchequer.l The injury which it remedied was that of encroachment of
jurisdiction, or calling one coram non judice. By means of this weapon the common law
courts were able to assert their supremacy over the admiralty and ecclesiastical courts, "See
O'Neil v. Kansas City etc. R. R. (C. C. 1887) 31 Fed. 663. "See N. Y. Code Civ. Proc., ?
3253; Sentenis v. Ladew (1893) 140 N. Y. 463, 35 N. E. 650. "Henry Ex'r. v. Murphy & Co.
(1875) 54 Ala. 246; see Day v. Wood- worth, supra. Costs do not include expenses incurred
preparatory to the commencement of an action. Studwell v. Cook (1871) 38 Conn. 549.
Counsel fees are not generally included in costs. Sedgwick, Damages (9th ed.) ?229; see
Jacobson v. Poindexter (1883) 42 Ark. 97. '"Dibbin v. Cook (1735) 2 Str. *1005; see Musser
v. Good, supra. This view still prevails in a few jurisdictions. See Tillman v. Wood, supra. In
Alabama the statute declares that costs are penal. See Lee v. Smyley (1849) 16 Ala. 773.
Being deemed penal, statutes awarding costs were strictly construed, Dibbin v. Cook, supra,
and this construction is generally followed today. Veidt v. Mo. K. & T. Ry., supra; State v.
Baker (1912) 35 Nev. 300, 129 Pac. 452. "Milliman, Law of Costs, ? 1; see Stevens v.
Central Nat. Bank (1901) 168 N. Y. 560, 61 N. E. 904; Sommer v. Compton (1909) 53 Ore.
341, 100 Pac. 289. '23 Halsbury Laws of England 184; see Glamorgan County Council v. Gt.
Western Ry. (1894) 1 Q. B. D. 21. '26 Halsbury Laws of England 797. '3 BI., Comm., *112.
338 This content downloaded from 49.36.62.118 on Tue, 21 Jul 2020 06:39:01 UTC All use
subject to ht NOTES. though a statute passed in 1296 provided an appeal to the Chancellor or
the Chief Justice against the issuance of a prohibition to the ecclesiastical courts.2 Later, the
common lawyers tried to use this writ to curb the glowing power of the chancery, but they
failed.3 With the end of the struggle between the common law courts and their various rivals,
the use of the writ of prohibition declined, but it still may be had to fulfill its original purpose
of prevelting an inferior court from usurping jurisdiction. The practice in issuing and
enforcing the writ is regulated by statute, but its nature, object, and functions, as well as the
facts governing its issue, are regulated by the common law." It is an extraordinary judicial
writ from a superior to an inferior court,5 having as its object to restrain the inferior courts
from exercising jurisdiction where they do not properly possess it at all, or else to prevent
their exceeding their limits in matters of which they have cognizance.6 The excess, as
distinguished from the want, of jurisdiction, does not relate to the prevention of errors of law
or procedure in an action over which the court has jurisdiction, but to a threat to make a
decision which the court has not acquired jurisdiction to make, although it has general
jurisdic- tion of the action.7 It is often said that the issuance of the writ is purely a matter of
discretion,8 but it seems that it should issue as a matter of right whera the inferior court
clearly has no jurisdiction.9 However, it is held to be discretionary when there is another
legal remedy,20 or when the one asking for the writ is a stranger"l to the original action
sought to be prohibited.12 Some courts refuse to grant the writ until a plea to the jurisdiction
has been made in the lower court without success,l3 but in England and in many of the states
such a plea is not an absolute prerequisite.> It is an original remedial writ, negative in its
nature, and preventive rather than cor- rective, and so will not issue after the act has been
done.'6 21 Holdsworth, History of English Law, 94. Ilbid., 250. 'People v. Wyatt (1906) 186
N. Y. 383, 394, 79 N. E. 330, 334. 'High, Extraordinary Legal Remedies, ? 762. ?Ex* parte
Roundtree (1874) 51 Ala. 42; Quimbo Appo v. People (1860) 20 N. Y. 531; Olden v. Paxton
(1915) 27 Idaho 597, 150 Pac. 40. 'People v. Hendrick (N. Y. 1915) 168 App. Div. 553, 153
N. Y. Supp. 188, aff'd. in 215 N. Y. 339, 109 N. E. 486; Roswell v. Richardson (N. Mex.
1915) 152 Pac. 1137. 8People v. Westbrook (1882) 89 N. Y. 152. 'See Mayor, etc., of
London v. Cox (1867) L. R. 2 H. L. 239, 278; In re New York & P. R. S. S. Co. (1895) 155
U. S. 523, 15 Sup. Ct. 183. :Ih re New York & P. R. S. S. Co., supra. 'The party seeking relief
by a writ of prohibition need not be named as a party in the original action, but may show that
he has an interest in the controversy. Cronan v. Dist. Ct. (1908) 15 Idaho 184, 96 Pac. 768.
"Kilty v. Jackson (1903) 184 Mass. 310, 68 N. E. 236. "Southern Pac. Ry. v. Superior Ct.
(1881) 59 Cal. 471; State v. Judge of Dist. Ct. (1877) 29 La. Ann. 806. "Mayor, etc., of
London v. Cox, supra; State v. Eby (1902) 170 Mo. 497, 71 S. W. 52; see Weil v. Black (W.
Va. 1915) 86 S. E. 666. "See State v. St. Paul (1900) 104 La. 280, 283, 29 So. 112; but see
Crit- tenden v. Booneville (1908) 92 Miss. 277, 45 So. 723. 339 This content downloaded
from 49.36.62.118 on Tue, 21 Jul 2020 06:39:01 UTC All use subject to ht COLUMBIA
LAW REVIEW. The weight of authority is that a superior court will grant the writ of
prohibition either in a case of abuse or usurpation of authority, where the inferior court has
not jurisdiction of the person through faulty service,16 or of the subject matter because it is
outside of the territorial jurisdiction,"' or because the amount is above or below the legal limit
for the court's cognizance,18 or where the inferior court is attempting to proceed under an
unconstitutional statute or ordinance when property would be destroyed or the parties
subjected to persecuting prosecution.9 Another ground for issuance is the disqualification of
a judge by interest20 or prejudice.21 The writ will not lie where there is another adequate
remedy at law or in equity.22 Other remedies are not adequate if they are so slow as to
produce mischief or immediate injury to property, and in such cases prohibi- tion should be
granted.23 Though prohibition originally issued only to inferior courts, its use has been
gradually extended, so that it now often issues also to quasi-judicial officers and boards.4
However, it will not issue to restrain wholly ministerial acts.25 Consequently, when a state
con- stitution includes prohibition within the limits of the original juris- diction of the
supreme court, the legislature has no power to authorize the issuance of the writ to ministerial
officers, since it cannot extend the functions of prohibition beyond those of the common law
writ, to which the constitution presumably refers.26 Even when there are no constitutional
difficulties, the court gives a strict construction to statutes that enlarge the scope of the writ,
as is shown by the recent case of State v. Ewert (S. D. 1916) 156 N. W. 90. There a statute
defined prohibition as' the counterpart of mandamus, and provided that it should issue to
restrain any officer from exceeding his juris- diction. Several previous decisions in South
Dakota had taken it for granted that this statute authorized a prohibition againat all minis-
terial acts. But the court over-ruled these cases, and held that the word "counterpart" must
have been used in a general sense, since jurisdiction can only be predicated of an officer
acting in a judicial or quasi-judicial capacity. "People v. Inman (N. Y. 1893) 74 Hun 130, 26
N. Y. Supp. 329. "Pennsylvania R. R. v. Rogers (1903) 52 W. Va. 450, 44 S. E. 300. "State v.
Judges of Ct. of App. (1888) 40 La. Ann. 771, 5 So. 114; Bul- lard v. Thorpe (1894) 66 Vt.
599, 30 Atl. 36. "State v. Eby, supra. *"Forest Coal Co. v. Doolittle (1903) 54 W. Va. 210, 46
S. E. 238. "People v. Dist. Ct (Colo. 1915) 152 Pac. 149. 'People v. Wyatts, supra; San Bruno
v. Superior Ct. (Cal. 1915) 152 Pac. 731. 'See State v. Denton (1908) 128 Mo. App. 304, 107
S. W. 446; State v. Dist. Ct. (Mont. 1915) 146 Pac. 743. "The adequacy of the appeal is the
test to be applied to applications for prohibition, and not the mere question of jurisdiction or
lack of jurisdiction." State v. Wright (1913) 76 Wash. 383, 136 Pac. 482. oConnecticut River
R. R. v. County Com'rs (1879) 127 Mass. 50; see State v. Stackhouse (1880) 14 S. C. 417,
427. 'Board of Education v. Holt (1903) 54 W. Va. 167, 46 S. E. 134. "Camron v. Kenfield
(1881) 57 Cal. 550; State v. Hogan (1900) 24 Mont. 379, 62 Pac. 493; Winsor v. Bridges
(1901) 24 Wash. 540, 64 Pac. 780. 340 This content downloaded from 49.36.62.118 on Tue,
21 Jul 2020 06:39:01

Unit –VIII

Ombudsman

8.1.Concept of Ombudsman
8.2. Ombudsman in Scandinavian Countries
8.3.Ombudsman in Common Law Countries
8.4.Lokpal and Lokayukta Act 2013
8.5.Working of Lokpal

OMBUDSMAN
The meaning of the term Ombudsman is ,”the man of
legislature”. Ombudsman is also known as the watchdog of
administration, protector of little man or advocate of little man.
It leads to open government by providing speedy redressal of
grievances. It offers democratic control over powers of State. It
is effective , in spite of minimal coercive capabilities and it
also serves as a channel between citizen and the Government
as it is the link between legislature and public. Ombudsman
has a correctional approach, it is an adjudicator in matters of
specific complaints from public against administrative injustice
& malafides.
Prof.Gerald E.Caden3 had commented in the 3rd
international conference on ombudsman,” institution of
ombudsman is an institutionalized public conscience- the
essence of what govt. ought to do; i.e. to cultivate the well being
of the citizens, preservation of individuals liberty and equitable
treatment of all citizens.”
Ombudsman is answerable to legislature as it reports to
it, is Accessible / user friendly and act as advocate of
citizens. It is also able to suggest reforms.
Difference between Ombudsman & Courts:-
Ombudsman follows simple Procedure; Principles of
Natural Justice are followed and its jurisdiction is also
wider to cover maladministration, dissatisfaction, rudeness
etc.
The Apex court had ruled that, “ effective policing of the
corridors of power is carried out by the courts until other ‘
ombudsman ‘ arrangements are made.”4
3 Author of Administraive law and public adm, books.
4 FCI Kamgar Union v. UOI , AIR 1981 SC 344
4
K.C.Wheare observes,” It is not eccentric to conclude that
if there is more administration, there will be more
maladministration.”5
Development :
Scandinavian countries
Sweeden-1809
Finland- 1919
Denmark 1953-54
Norway 1963
Common Law Countries :
New Zeeland-1962
England- 1966-67- 3 local, 11 sectorial
Canada-1967
Australia-1976
Historical background : The institution of ombudsman,
developed in the Scandinavian countries primary to redress
individual grievances against the administration1. The idea was
then adopted by common law countries. For instance, New
Zealand was the first common low country to institute an
ombudsman in 1962 followed by Britain2 and then Australia3.
OMBUDSMAN IN NEW ZEALAND : Adopted in 1962
under the Parliamentary Commissioner(Ombudsman) Act,
1962. Later Ombudsman Act, 1975 was framed which has a
provision for one Chief Ombudsman and other Ombudsmen.
Ombudsman is appointed by Governor General on the
5 WHEARE , MALADMINISTRATION AND ITS REMEDIES,1973
1 The institution of ombudsman was established in Sweden in 1809; Finland followed
in 1919, Denmark in 1953 and Norway in 1962
2 In Britain ombusman is officially called as the Parliamentary Commissioner and was
established in 1967.
3 In Australia, the system was established in 1967.
5
recommendation of House of Representatives. He has the
Security of tenure which is 5 Years. He can be Removed by
Gov. Gen. upon an address from the house of representatives.
He also has Powers under the Official Information Act, 1982
OMBUDSMAN IN ENGLAND
“ The ombudsman concept is based on the idea that
citizens should be entitled to complain against specific acts of
their rulers, and that their complaints should be independently
investigated.”6
Ombudsman in England is Officially known as
Parliamentary Commissioner. It is Created by the
Parliamentary Commissioner Act, 1967. He is appointed by
the Crown and removed by address in both the houses.
Jurisdiction covers the departments placed under Schedule-
II-all local authorities, education appeal panels, local services.
Excluded matters are given under Schedule-III. Parliamentary
Commissioner does not investigate into matter in which
remedy is available through courts or where aggrieved person
has right to appeal. He does not investigate into matter more
than 12 months old.
There is a peculiar restrictive feature in England called as
the parliamentary filter. Complaints are filed only through a
member of parliament. Reasons for continuing this feature are
that it affords a kind of screening of complaints and it is also
their tradition.
AUSTRALIAN OMBUDSMAN :
Framing of the office of Ombudsman is in accordance
with Federal System. Two tier Ombudsman exists in Australia.
The Commonwealth Ombudsman system was established by
6 Seneviratne,”joining up” the Ombudsman-the review of the public sector ombudsman
in England.(2002),p.2.
6
the Ombudsman Act, 1976.It has been amended several times.
Last amended in 1983, similar to New- Zealand Act.
Ombudsman System : A Commonwealth Ombudsman
is appointed for the term of 7 years, eligible for reappointment,
appointed by the Governor Gen. (Executive appointee), retires
at the age of 65. Years. He can delegate its powers to deputies
and also has functions under the Complaints(Australian
Federal Police) Act, 1981 and Freedom of Information
ACT(FOIA)
Removal is possible on address in the two houses of
parliament on the grounds of proved misbehavior or physical
or mental incapacity;
Composition :
• 3 Deputy Commonwealth Ombudsman;-
• A Defence Force Ombudsman;
• Jurisdiction-Complaints against -
• Action
• inaction
• decision
• recommendation
• formulation of proposal Done by govt. departments.
Action on complaint/ suo motu
The term “matter of administration” is undefined, flexible,
matter of power and function and is decided by the Federal
Court. Ombudsman does not investigates frivolous / vexatious
complaints. The limitation period is 12 months.
Section 15 of the Ombudsman Act, 1976 lays down a
catalogue of circumstances in which the Ombudsman may
consider the administrative action defective. The catalogue
includes the circumstances7
When administrative action —Appears to be contrary to
law, based on mistake of facts/law, otherwise wrong. Or is-
• Unreasonable
• Unjust
• Oppressive
• Improperly discriminatory
In all these countries, ombudsman functions primarily to
redress individual grievances against the administration. For
instance, in Australia, the ombudsman has jurisdiction to
investigate into complaints against action taken by major
government departments and prescribed authorities. The
ombudsman’s primary function is to investigate either on a
complaint or suo motu, into a matter of administration taken
by a department or a prescribed authority. ‘Taking of action’
includes a reference to:
1. the making of a decision or recommendation or the
formulation of a proposal; and
2. failure or refusal to take any action.
In Britain, the ombudsman is charged with the function of
investigation into complaints from people against
maladministration4
The primary reason underlying the establishment of the
institution of ombudsman is to provide a forum, in addition to
the courts, to redress the grievances of an individual against
the administration. Although over a period of time, the range
and scope of judicial review of administrative action has
expanded, there still remain a few areas where judicial review
does not reach. For instance, courts refrain from scrutinising
4 The term ‘maladministration’ is defined broadly. The British ombudsman is concerned
with injustice in consequence of maladministration in administrative action that includes
failure to act. The term maladministration includes corruption, bias, unfair
discrimination faulty procedure and harshness.
8
the merits of an administrative decision and play only a marginal
role .
OMBUDSMAN IN INDIA :
Mahatma Gandhi had once opined, “Corruption will be
out one day, however much one may try to conceal it: and
the public can as its right and duty, in every case of justifiable
suspicion, call its servants to strict account, dismiss them,
sue them in a law court, or appoint an arbitrator or inspector
to scrutinize their conduct, as it likes.”
This is the inspiration for establishment of the institution
of Ombudsman in India. The Apex Court had commented on
the need of such institution in these cases-
Chandra Bansi Singh v. State of Bihar,7 “ The greater
the power given to the executive, the greater the need to
safeguard the citizen against its arbitrary or unfair exercise.
Therefore an urgent problem of the day is to evolve an
adequate and effective mechanism to contain these
dangers by controlling the administration in exercise of
its powers, safeguarding individual rights and creating
procedures for redressal of individual grievances against
administration.”
G. Sadanandan v. State of Kerala,8 " …continuous
exercise of the very wide powers conferred by the rules
on the several authorities is likely to make the conscience
of the said authorities insensitive, if not blunt, to the
paramount requirement of the
Constitution that even during emergency the freedom of
Indian citizens can not be taken away…"
7 AIR 1984, SC 1767,
8 AIR 1966 SC 1966 SC 1925.
9
The genesis of Indian Ombudsman goes back to 3 April
1963, when Dr. L.M. Singhvi, (a former member of Rajya Sabha
and a member of the Standing Committee headed by
Mukherjee) participating in the discussion on Demands for
Grants of the Ministry of Law and Justice, stressed the need
for setting up of some sort of a Parliamentary Commission on
the pattern of Ombudsman in Scandinavian countries. India,
Ombudsman is called as Lokpal or Lokayukta. An
Administrative Reforms Commission (ARC) was set up on 5
January 1966 under the Chairmanship of Shri Morarji Desai.
It recommended a two-tier machinery: Lokpal at the Centre
(Parliamentary commissioner as in New Zealand) and one
Lokayukta each at the State level for redressal of people’s
grievances. However, the jurisdiction of the Lokpal is not
extended for judiciary like in New Zealand.
In the Report dated Oct.20, 1966 of the Administrative
Reforms Commission main issue before Commission
was to find out that how to provide the citizen with an
institution to which he can have easy access for the
redress of his grievances which he is unable to see
elsewhere. The Indian Lokpal is synonymous to the
institution of Ombudsman existing in the Scandinavian
countries. Government of India accepted the
recommendations of the Commission. In 1969, the Lok
Sabha passed the lokpal and lokayukta Bill,1968.This Bill
could not be passed in Rajya sabha, Lok sabha got
dissolved. Again in 1971 Bill was passed by Lok Sabha
but before efore it could be passed by Rajya Sabha, Lok
Sabha was dissolved.-Bill Lapsed.
The bill was revived in 1985, 1989, 1996, 1998, 2001 and
most recently in 2005. Each time, after the bill was introduced
to the house, it was referred to some committee for
10
improvements - a joint committee of parliament, or a
departmental standing committee of the Home Ministry -and
before the government could take a final stand on the issue
the house was dissolved.
In 2001 Bill presented in Lok sabha,13th Lok Sabha
dissolved and the Bill Lapsed. The Central Government
introduced the first Lokpal and Lokayuktas Bill in 1968 and
then in 2005, which has so far not been enacted. In 2003 ( In
fact that time it also had the recommendations from the Cabinet
to bring in Prime minister also in to the Lok pal bill) and due to
non co-operations from Congress and other parties, the bill
could not be passed. Even during UPA period in 2004 it
promised to take up the issue, yet the unwillingness from all
the political parties sounded a death knell to this proposal.
One of the major points of dispute was that P.M. should be
included or not. The Rajya Sabha Standing Committee on the
Lok Pal Bill 2001produced a comprehensive report. The report
had suggested the inclusion of the judiciary. Regarding the
inclusion of P.M. though it has been the pious intention of the
Bill to bring the office of the Prime Minister under its ambit, it
is doubtful if the proposal would receive all round political
support. Some parties are opposed to this inclusion. This
disagreement has been a major factor in the Bill not being
able to find a place in the Statute Book for decades. Ex.
President Dr. Abdul Kalam and its career-economist-turned
Prime Minister Dr. Manmohan Singh brought the issue of Lok
Pal back to center-stage. In the process, the two, with similar
non-political background, bestirred the political class, still
remaining dormant to the need of an Ombudsman to scrutinize
the doings of people in the higher echelons of governance. It
is a legislation that can be passed by a simple majority. Only,
it has fallen victim to political and official dalliance, dither and
11
double-speak. Every government in the past four decades has
failed to muster enough political will needed to pass the Bill.
The Lokpal and Lokayukta Bill, 2011 :
In the year 2011, the anti corruption movement run under
the leadership of Anna Hazare, the social reformist and thinker
had created a wave against corruption. The strong public
support to his proposed, “Jan Lokpal Bill” and the ‘fast’ kept
by him had built a pressure for the passing of Lokpal Bill at the
Centre.
After almost 12 hours the spirited debate continued in the
Lok Sabha on 27th of December 2011. In this debate the entire
political opinions for and against the Lokpal Bill were heard
loud and clear, the UPA accepted some important
amendments which were proposed by rival parties to get The
Lokpal and Lokayukta Bill, 2011, passed through a voice vote.
Finally the 2011Bill was approved after the government moved
some key amendments, including keeping the defence forces
and coast guard personnel out of the purview of the anti-graft
ombudsman and increasing the exemption time of former MPs
from five to seven years. A number of amendments moved by
Opposition, including corporates, media and NGOs receiving
donations, were defeated. Now it is not certain that this Bill will
be passed in the Rajya Sabha tomorrow where the UPA has
less than 100 members in the 245 member House.
The government is learnt to be exploring an option of
convening a joint sitting of Parliament9 if the Lokpal and
Lokayukta Bill, 2011 fails to get passed through the Rajya
Sabha where it will be taken up for consideration and passing
on the last day of the extended winter session on Thursday.
9 The Constitution has the provision of convening joint sitting of Parliament under
Article 118 for passing any bill - other than a money bill or a constitution amendment
bill - if it fails to get the Rajya Sabha’s approval.
12
LOKAYUKTA :
Lokayukta institution has come into existence in different
years, in different States in India. Orissa is the first state to
present a bill on establishment of Lokayukta in 1970, however,
Maharashtra is the first state to have established the institution
in 1972.
There after, this institution was established in different
States in different years namely:
1. Maharashtra (1972),
2. Bihar (1974),
3. Uttar Pradesh (1977),
4. Madhya Pradesh (1981),
5. Andhra Pradesh (1983),
6. Himachal Pradesh (1983),
7. Karnataka (1984),
8. Assam (1986),
9. Gujarat (1988),
10. Delhi (1995),
11. Punjab (1996),
12. Kerala (1998),
13. Chhattishgarh (2002),
14. Uttaranchal (2002) .
15. West Bengal (2003)’
16. Haryana (2004).
The structure of the Lokayukta is not uniform across all
the states. Some states have UpaLokayukta under Lokayukta
and in some states, the Lokayukta doesn’t have sou moto
powers of investigating an enquiry.

Unit IX

Public Corporations

9.1 Definitions, Object, Characteristics

9.2 Classification
9.3 Rights and Duties
9.4 Legislative Control
9.5 Executive Control
9.7Judicial Control

. PUBLIC SECTOR IN INDIA …..LN Welingkar Institute Of Management Development &

Research , Bangalore
2. • Refers to part of the economy concerned with providing various government services • 51%
or more of the paid up share capital is help by central government or by any state government.
WHAT IS A PUBLIC SECTOR
3. • At the time of independence, India was backward and underdeveloped – basically an
agrarian economy with weak industrial base, high rate of unemployment, low level of savings
and investment and near absence of infrastructural facilities. • Indian economy needed a big
push. This push could not come from the private sector because of the lack of funds and their
inability to take risk with large long- gestation investments. • As such, government intervention
through public sector was necessary for self-reliant economic growth. PUBLIC
SECTOR:BACKGROUND
4. • Hence, the roadmap for Public Sector was developed as an instrument for self-reliant
economic growth. The country adopted the planned economic development polices, which
envisaged the development of PSUs. • Initially, the public sector was confined to core and
strategic industries. The second phase witnessed nationalization of industries, takeover of sick
units from the private sector, and entry of the public sector into new fields like manufacturing
consumer goods, consultancy, contracting and transportation etc. PUBLIC
SECTOR:BACKGROUND
5. • To promote rapid economic development through creation and expansion of infrastructure •
To generate financial resources for development • To promote redistribution of income and
wealth • To create employment opportunities • To promote balanced regional growth • To
encourage the development of small-scale and ancillary industries, and • To promote exports
on the one side and import substitution, on the other. OBJECTIVES
6. • 1. Fillings of Gaps: At the time of independence, there existed serious gaps in the industrial
structure of the country, particularly in the fields of heavy industries such as steel heavy,
machine tools, exploration an refining of oil, heavy electrical and equipment, chemicals and
fertilizers, defense equipment, etc. • 2. Employment: Public sector has created millions of jobs
to tackle the unemployment problem in the country. Public sector accounts for about two-thirds
of the total employment in the organised industrial sector in India. Contribution of PSUs
7. • 3. Social Justice : Public enterprises have contributed towards the achievement of
constitutional objectives. They have been helpful in reducing the concentration of economic
power in private hands, in curbing anti-social monopolies, in accelerating public control over the
national economy. • 4. Development of Ancillary industries: In order to encourage the
development of small scale and medium-sized industries in the country, the Government of
India has launched a national programme. Public sector ha contributed to this programme by
fostering the growth of ancillary industries and satellite planets.
8. • The Central Public Sector Enterprises (CPSEs) are also classified into 'strategic' and 'non-
strategic'. Areas of strategic CPSEs are: • Arms & Ammunition and the allied items of defense
equipment's, defense air-crafts and warships • Atomic Energy. • Railways transport. • All other
CPSEs are considered as non-strategic. Categories of PSUs
9. • Public Sector Enterprises having objects to promote commerce, art, science, religion,
charity or any other useful purpose and not having any profit motive can be registered as non-
profit company under section 25 of the Companies Act, 1956. • Such companies are also called
as the Non-profit or 'No Profit - No Loss' companies.
10. • Public Sector Banks (PSBs) are banks where a majority stake (i.e. more than 50%) is held
by a government. The shares of these banks are listed on stock exchanges. There are a total of
21 PSBs in India. • The objectives behind nationalisation where: 1. To break the ownership and
control of banks by a few business families, 2. To prevent the concentration of wealth and
economic power, 3. To mobilize savings from masses from all parts of the country, 4. To cater
to the needs of the priority sectors.....
11. “GDP” IMPACT & PERFORMANCE Economic development and industrialisation
Employment Workforce: productivity challenges Foreign exchange earnings Investments in
modern forms of IT Turnover of more than USD 1 Trillion by 2020
12. GOVERNMENT-OWNED GOVERNMENT INTERFERENCE LACK OF TRANSPARENCY
AND ORDERLY FUNCTIONING CORPORATE GOVERNANCE ACCOUNTABILITY OF “PSU”
13. STATICALSTATISTICAL TALKS GROWTH OF “CPSE’s”
14. STATISTICAL TALKS SHARE OF ‘CPSE’s” IN INDIAN GDP • As reflected in the figure
alongside, the turnover of CPSEs have increased from Rs. 7.4 lakh crores in FY 2005 to an
estimated Rs.12.6 lakh crores in FY 2009 registering a CAGR of 14.1% during the FY 2005-09
period. Further, the growth in CPSEs has been in line with the overall GDP3 growth of the
country, recording a CAGR of 14.5% during the same period  Consequently, in terms of
turnover, the contribution of CPSEs to the GDP has ranged between 22%- 23% during the
period
15. STATISTICAL TALKS Over the years, CPSEs have contributed significantly to the Central
exchequer by way of payment of taxes (direct and indirect), duties, dividend payment and
interest on Government loans. As evident from the chart alongside, the total contribution by the
CPSEs has increased from Rs. 1.1 lakh crores in FY 2005 to an estimated Rs. 1.5 lakh crores
in FY 2009 registering a CAGR of 8% during the FY 2005-09 period. However, there has been
a YoY decline in contribution by 8.5% in FY 2009 primarily on account of reduction in
contribution towards customs and excise duty
16. During the initial years and even during the nineties, a large number of CPSEs were
dependent on budgetary support extended by the Central Government. However, the number
of CPSEs in this category has gradually decreased over the years. The chart alongside shows
Government budgetary support to CPSEs during the FY 2005- 09 period. STATISTICAL
TALKS
17. DOMINANT “PSU”
18. India Top 10 Revenue Generation Wise
19. PSE CPSE PSB PUBLIC SECTOR UNDERTAKING CLASSIFICATION STATUS OF
PUBLIC SECTOR UNDERTAKING MINIRATNA NAVRATNA MAHARATRNA
20. Framework
21. Example Maharatna • Indian Oil Corporation Limited • NTPC Limited Navratna • Hindustan
Petroleum Corporation Limited • Mahanagar Telephone Nigam Limited Miniratna Category •
Airports Authority of India • Antrix Corporation Limited
22. Benefits 1. Balanced growth: By establishing public sector enterprises, a country can
develop its economy in all regions. Thus there is a balanced growth. These enterprises can be
developed on economic, social and regional basis. 2.Facilities for economic development:
Profits of public enterprises can be used by the state for financing the schemes of economic
development. 3.Greater public welfare: Private enterprises are for increasing profit but public
enterprises do not work for making profit for the owner but they work to help the national
economy as a whole. 4.Equal distribution of wealth: With the help of public sector there is
possibility for the Government to reduce inequalities of income and wealth among the people
23. Political interference: Due to undue influence of politicians, the public sectors cannot
function smoothly and effectively. It hampers the efficient conduct of operations. Slow growth:
Public enterprises have little scope for expansion and modernisation as they take a long period
to establish and the return on investment is also less. Poor management: Due to excess
interference by the Government and political parties, the public enterprises cannot be managed
on sound lines or as per the plans laid out. Further the financing of public sector is fully in the
hands of the Government, which restricts the scope for development. Lack of flexibility: There is
a lack of flexibility in public enterprises. This is due to slow decision making habit of the state.
Implementation of the decision also takes a long time in public enterprises. Lack of initiation
and efficiency: Lack of profit motive leads to inefficiency and slow working. Therefore decision
making is not so quick in public sector like in private enterprises. Public Enterprises are
managed like Government offices, thus efficiency cannot be seen in public enterprises.
Limitation
24. Disinvestment Disinvestment can be defined as the action of an organization (or
government) selling or liquidating an asset or subsidiary. It is also referred to as ‘divestment”.
Example:- 1. Maruti Udyog 2. SAIL 3. Indian Airlines 4. Indian Oil 5. BALCO
25. Objectives of Disinvestment Reduce financial burden on government. Improve public
finance. To maintain competition and market discipline. To encourage wider share of
ownership.
26. Disinvestment Types Minority Disinvestment • Andrew Yule & Co. Ltd. Majority
Disinvestment • NTPC Ltd Completely Disinvestment • 18 hotel properties of ITDC Example
Example Example
27. • Improves corporate governance & CSR • Enhanced corporate governance with the
induction of independent directors • Infrastructure, education, healthcare, and law and order
development. Benefits of Disinvestment…
28. • Privatization implies a change in ownership, resulting in a change in management. The
privatization of public sector enterprises will occur only when govt. sells more than 51% of its
ownership to private entrepreneurs. • Disinvestment on the other hand, has a much wider
connotation as it could either involve dilution of govt. stake to a level that result in a transfer of
management or could also be limited to such a level as would permit govt. to retain control over
the organization. • Disinvestment beyond 50% involves transfer of management, where as
disinvestment below 50% would result in the govt. continuing to have a major say in the
undertaking . Privatization and Disinvestment
29. The decision regarding disinvestment or liquidation viewed in the light of following criteria:
Whether the objectives of the company are achieved. whether there is decrease in number
of beneficiaries .  Whether serving the national interest will be affected because of
disinvestment  Whether private sector can efficiently operate and manage the undertaking. 
Whether the original rate of return targeted could not be possible to achieve. Criteria for
Disinvestment
30. • In Private Sector, the decision making process is quick and decisions are linked with the
competitive market changes. • The disinvestment process would bring in better corporate
governance, exposure to competitive, corporate responsibility, improvement in work
environment etc. • The market participation in capital of PSUs through stock exchanges would
enable the market to discover the latent worth of PSUs. • The Loss making PSUs can be
successfully revived by asking the strategic partner to infuse fresh capital and exercising
excellent management control over sick PSUs Merits of Disinvestment
31. • Selling of profit-making and dividend paying PSU would result in loss of regular source of
income to the government. • There would be chances of ‘asset stripping’ by the strategic
partner. Most of the PSUs have valuable assets in the shape of plant and machinery, land and
buildings etc. • The Government’s Policy or disinvestment includes the disposal of both profit
making, as well potentially viable PSUs. Demerits of Disinvestment
32. • Citizens have every right to own part of the shares of Central Public Sector Enterprises. •
Central Public Sector Enterprises are the wealth of the Nation and this wealth should rest in the
hands of the people. • While pursuing disinvestment, the majority shareholding of at least 51%
 and management control of the Central Public Sector Enterprises to be retained by the
Government. Policy on Disinvestment
33. • Government's stakes in CPSEs would squeeze this important source of revenue for the
Government. • Thus essentially implying that the real beneficiaries would not be the ordinary
retail investor but institutional investors. • in the case of disinvestment, future streams of income
from dividends are forgone against a one-time receipt from the sale of stakes • Employees of
PSUs would lose jobs Arguments against Disinvestment
34. • Unfavorable market conditions • Offers made by the government were not attractive for
private sector investors • Lot of opposition on the valuation process • No clear-cut policy on
disinvestment • Strong opposition from employee and trade unions • Lack of transparency in
the process • Lack of political will Why Low Disinvestment???
35. Coal India Ltd. (CIL), a CPSE, is a Navratna Company engaged in production and
marketing of coal and coal products. At present, the paid-up equity capital of the company is
Rs. 6,316.36 crore and the Government of India holds 100% of the equity in the company. CIL
is planning to disinvestment 10% Disinvestment of 5% paid up equity of Bharat Heavy
Electrical Ltd. Privatization of 6 airports including Delhi , Kolkata & Chennai Some Recent
Divestments & Privatization
36. Statistical talks
37. Public sector banks in India • PSBs majority stake held by a government • listed on stock •
21 Emergence of public sector banks Public sector banks before the economic liberalisation
Public sector banks in India
38. SOURCE: http://www.moneycontrol.com/stocks/top-companies-in-india/net-profit-
bse/banks-public-sector.html
39. FINANCIAL PLANNING: Strategy for PSB Identification of Customer Mapping the
requirements of customers Organizations of products and offerings Competent services and IT
architecture Integrated Marketing Communications FINANCIAL PLANNING: Strategy for PSB
40. FINANCIAL PLANNING: Strategy for PSB Identification of Customer Mapping the
requirements of customers Organizations of products and offerings Competent services and IT
architecture Integrated Marketing Communications FINANCIAL PLANNING: Strategy for PSB
41. FINANCIAL PLANNING: Strategy for PSB Identification of Customer Mapping the
requirements of customers Organizations of products and offerings Competent services and IT
architecture Integrated Marketing Communications FINANCIAL PLANNING: Strategy for PSB
42. FINANCIAL PLANNING: Strategy for PSB Identification of Customer Mapping the
requirements of customers Organizations of products and offerings Competent services and IT
architecture Integrated Marketing Communications FINANCIAL PLANNING: Strategy for PSB
43. FINANCIAL PLANNING: Strategy for PSB Identification of Customer Mapping the
requirements of customers Organizations of products and offerings Competent services and IT
architecture Integrated Marketing Communications FINANCIAL PLANNING: Strategy for PSB
44. NPA (NON PERFORMING ASSET) • Non Performing Asset means a loan or an account of
borrower, which has been classified by a bank as sub- standard, doubtful or loss asset, in
accordance with the directions or guidelines relating to asset classification issued by RBI. •
Earlier assets were declared as NPA after completion of the period for the payment of total
amount of loan and 30 days grace. • In present scenario assets are declared as NPA if none of
the installment is paid till 180 days i.e. six months in respect of a term loan. NPA (NON
PERFORMING ASSET)
45. NPANPA (NON PERFORMING ASSET)
46. What is an ETF? Two great investment ideas brought together ETFs DiversifiedTradable
during the day Diversified funds that trade like stocks Mutual FundStock They are listed and
traded like a stock on major stock exchanges globally What is an ETF? Two great investment
ideas brought together

Public Sector Undertakings are of' recent origin but are deep-rooted and are today playing a
vital role in our economy . With the increase in the volume of' work and tendency for
nationalization, need and necessity of public sector enterprises has considerably increased. It
is felt that through those public sector undertakings, effective government control can be run
and managed for the welfare of the community as a whole. There cannot be two opinions
about the need for establishment of' public sector enterprises in the developing countries like
India. The private enterprises are always in search of profit and this motive leads them to
fields \\here the returns are high and certain. In the developing countries, this tendency has
many drawbacks (http:' w w .\vikistreets.corn). The government-owned corporations play a
pivotal role in the economic development of emerging economies because their participation
is higher in the industrial and commercial activities of these economies. Resource constraints
and limited scope of the private sector in the early stages of development and planning have
set the stage fir predominance of the public enterprises in these economies. Page 1 83 Thus.
public sectors in the leading developing countries of the world play a very iin portant role.
Investments in public sector enterprises have also been greater and have continued to
accelerate growth in core sectors of a developing economy. Many times, public enterprises
were created to operate in areas of national and international trade, consultancy, inland, and
overseas communication and construction services. As a result, overall profits of the public
sector have not been restricted to certain sectors. In other words. the public sector is a
heterogeneous combination of basic infrastructure industries, industries engaged in providing
trade services, consumer goods industries. Rapid industrialization and infrastructure creation
for economic development 'sere the basic rationale behind setting up public enterprises.
Governed by this rationale. the public enterprises were set up by the government to ensure
easy availability of' important articles of mass consumption, and to promote even distribution
of income while keeping tabs on prices of vital products. Protection of workers interests was
also one of' the objectives as large number of enterprises was created from sick private sector
enterprises that were taken over. Promoting, and ensuring that regions \\ere developed in a
balanced manner and earning foreign exchange by promoting import substitutions were some
additional reasons for encouraging public enterprises. In India and China. PSl'.s \\ere the key
catal\ tits in capital formation in the early stages of industrial development. PSEs hold
sizeable share in economic activity of a number of developed and developing economies -
France. Japan, German,.-. Italy. Australia. South Korea. China. Malaysia. Philippines.
Indonesia. Sri Lanka. and India (http:', \\\\\%.dnb.coJn). Depending on their performance.
investment capability. etc. PSU's are divided into 3 categories: a) \linlratna . h) Navratna and
c) Ntaharatna (http:// w ww ww .todpoint.com ). Page 1 84 Miniratna \liniratnas have the
authorit% to enter into joint ventures, set subsidiary companies and overseas office with
certain conditions. They have been divided into categories on the basis of their capital
expenditure allowance. Navratna In 1997. the government introduced the Navratna scheme
for the 9 identified Central Public Sector Enterprises (CPSEs) that had comparative
advantages and to support them in becoming global giants. The board decided to give them
additional powers in areas of. capital expenditure, investment in Joint Ventures or
subsidiaries, mergers and acquisitions and Iluman Resource Management. These Navratnas
were given the authority to invest to a maximum of Rs. 1000cr without government
approvals. I.ater on the number kept on adding every year and now there are 16 Navratnas.
Criteria for Navratna Status Maharatna In 2009. the cabinet established a Maharatna status
for Central Public Sector Enterprises. hich raised the company's investment ceiling from
Rs.1000cr to Rs.S000cr. As on April 2011. there are a total of 5 companies which have been
awarded the N'laharatna status (http: \v«w.todpoint.com). Different Types of Public
Enterprises ❖ C'['Sl s (Central Public Sector Enterprises) — Companies \\- here the direct
holding of the Central Government or of other CPSFs is 51 % or more ❖ PSBs (Public
Sector Banks) Banks \\-here the direct holding of the Central "State Government or other
PSBs is 51 % or more Page 185 ❖ SLPEs (State Level Public Enterprises) — Companies
where the direct holdilu1 of the State Government or other SLPEs is 51% or more (http:
'\V \V W . hsepsu.cortl ). Product Profile Public sector enterprises offer a wide range of
products and services which include: ❖ ./1anofaetwrm .t ❖ Steel ❖ k lea\ \ machinery ❖
Machine tools •.• Ir1stl'lrI1lCnts ❖ 1-leavv machine huildinq equipment •:• I leave electrical
equipment for thermal and hydel stations •:• l ransportation equipment •••
Telecommunication equipment •:• Ships and sub-marines ••• Fertilizers ❖ Drugs and
pharmaceuticals ••• Petrochemicals ••• Cement . ❖ Textile :• \linin<" of coal and minerals ❖
Extraction and retining of crude oil ❖ Operation of air, sea. river and road transport ❖
National and international trade ❖ Consultancy Page 1 86 •: Contract and construction
services •:• Inland and overseas telecommunication services •: 1= inancial services •: ('onsu
mer items such as newsprint, paper and contraceptives :• 1 lotel and tourism services As on
31st Nlay 2012. there were as man \- as 249 CPSEs (excluding 7 insurance companies). The
number of profit making CPSI:s increased steadily from 143 CPSEs in 2004-05 to 160
CPSEs in 2007-08. The number of profit making ('PSl s. as on 2010-11 stands at 158 \ti ith a
total profit oIRs. 113770 crores. Different profiles have been shown in Annexure I (Public
Enterprise Survey 2010-1 1). Department of Public Enterprises In 52nd Report. the Estimate
Committee of 3rd Lot: Sabha (1962-67) stressed the need for setting up a centralized
coordinating twit, which could also make continuous appraisal of the performance of public
enterprises. This led to the setting up of the Bureau of Public Enterprises (BPE) in 1965.
Resulting in the reorganization of the ministries or department of the Union The Government
in September. 1985 BPE. a part of the Ministry of Industry. In NIa\ 1990. the BPL as made a
full-fledged Department and is now known as the Department of Public Enterprises.
Presently. it is part of' the Ministry of Heavy Industries & Public Enterprises. \s per
Allocation of Business Rules of the Government. the following subjects have been allocated
to the Department of Public Enterprises:- •:• Bureau of Public Enterprises including Industrial
Management pool. •.• Coordination of matters of general policy of non-financial nature
affecting all public sector industrial and commercial undertakings. •:• Matters relating to
Memorandum of Understanding mechanism of improving the performance of Public Sector
Undertakings. Page ' 87 •:• Matters relating to Permanent Machinery of Arbitration for the
Public Sector Enterprises. •:• Counseling. Retraining and Redeployment of rationalized
employees of ('PSI-:s. The Department of Public Enterprises accordingly plays an important
role in formulating policies relating to CPSEs and in Framing different guidelines on matters
relating to CPSEs. In fulfilling its role, the Department coordinates with other Ministries.
CPSEs and concerned organizations. Some of the important tasks of the Department are listed
below:- •:• Co-ordination of matters of general policy of non-financial nature relating to
public sector enterprises. •:• Issue of Presidential directives and guidelines to public sector
enterprises. •:• Formulation of policies, pertaining to public sector enterprises, in areas like
hoard structures. personnel management. improvement, financial management. wage
settlement and vigilance management etc. •:• Investiture and review of Navratna or Miniratna
or Maharatna status to CPSI-s. •:• Policy matters relating to composition of Board of
Directors of CPSEs, categorization of top posts and scheduling of CPSFs. •:• Notification of
pay scales to Board level executives, below Board level personnel, unionized \\orkers and the
DA admissible thereon at periodic intervals. :• Publication of' the annual survey of CPSEs
known as Public Enterprises Survev. •:• Memorandum of t'nderstanding (MoU) between the
public sector enterprises and the administrative Ministries or Departments. :• Policy relating
to Voluntary Retirement Scheme in CPSEs. Page 1 88 ❖ Matters relating, to Counseling.
Retraining and Redeployment Scheme (CRR) for rationalized employees of CPSEs. ❖
Matters relating to Board for Reconstruction of Public Sector Enterprises (13RPSE). •:•
\latters relating to reservation of posts in the public sector enterprises for certain classes of
citizens. •:• Settlement of disputes through Permanent Machinery of Arbitration (PNIA)
among Public Sector Enterprises and het~teen Public Sector Enterprises and government
departments except disputes relating to tax matters. •:• Matters relating to International
Centre for Promotion of Enterprises (ICPE). ❖ Matters relating to Standing Conference of
Public Enterprises (SCOPE). •:• Matters relating to delegation of powers to Board of
Directors of C PSEs. Department of Public Enterprises is headed by a Secretary who is
assisted by an establishment with an overall sanctioned strength of 1 )1 officers or
personnels. The Department of Public Enterprises is implementing two Plan Schemes viz. the
Scheme o1' Counseling. Retraining and Redeployment (CRR) for the separated netple\ees of
CPSEs and the Scheme of Research. Development and Consultancies on Generic Issues of
CPSE:. ('RR Scheme was implemented from 2001-02 while Scheme of Research.
Development and Consultancies on Generic Issues of CPSE was introduced in 2008-09
(http:.''dhi.nic.in). Overview of State Public Sector Undertakings the State Public Sector t
ndertakings (PSIJs) consist of State Government Companies and Statutory Corporations. The
State PSUs are established to carry out activities of commercial nature While keeping in view
the %\ellitre of people. In Andhra Pradesh, the State PSUs occupies an important place in the
state economy. The working State PSL's registered a turnover of Rs 44.180 crore for 2008-09
as per Pace 1 89 their latest finalized accounts as on September 2009. This turnover was
equal to 14.13 per cent of State Gross Domestic Product (GDP) for 2008-09. Major activities
of Andhra Pradesh State PSUs are concentrated in power sector. The working State PSUs
including working statutory corporations earned a profit of Rs 701.56 crore in the aggregate
for 2008-09 as per their latest finalized accounts. They had emplo\ ed 2.60 lakh employees as
on 31 March 2009. The State PSL s do not include nine Departmental Undertakings (DIJs).
which carry out commercial operations but are a part of Government departments. Audit
findings of these are incorporated in the Civil Audit Report for the state (http;
aghr.cag.gov.in/commercial 10 (E) 'ch I .Pdf ). Role of Public Sector Enterprise in Indian
Economy: The public sector has been assigned the important role of achieving one national
objective of economic growth %\ ith social justice, generating larger social gains and
strengthening country's economy by removing regional disparities and promoting balanced
development in different parts of the country. The impact of public sector undertakings on the
regional development may be assessed in terms of two different components. \ it. (A) Direct
Impact and (B) Indirect Impact. Public sector enterprises have rendered useful help and
service in the development of' human resource in backward areas for changing the traditional
character of village life. In tstment in human capital is considered an essential ingredient of
development planning. Such development is only possible if rural talents are identified
properly fed with modern knowledge of relevant science and technology. A large number of
public sector undertakings have been set up in the backyard areas or regions or districts in
order to capitalize the rural labour by equipping them with vocational education, technical
training and managerial skills. The strategy behind this is to transform the unemployed rural
people to get selfmotivated and self-inspired employment avenues in local economic
activities. Page 1 90 Public sector undertakings working as a vehicle of communication have
taken the ne\\ kno ledge to villages and acted as change agents li)r introducing changes in
existing practices. initiating commercial use of appropriate village technologies in agriculture
and allied activities, village artisan and handicrafts and local village industry by inducing use
of productivity enhancing equipment and light machinery. Apart from the above, a
I111I11ber of public sector undertakings have been taking special interest in setting up
community development centers to discharge their social responsibility. Improvement in
economic infrastructure in the backward areas can be provided through the help and active
participation of the public sector undertakings. This should broadly cover constructing or
improving existing link roads and inside roads in villages to make these accessible by modern
means of transport, ensuring that each village is equipped with electricity and power for
domestic as well as commercial and industrial use. Indian public sector constitutes the core of
the economy's social and economic development history, since the dawn of Independence in
1947. Rightly, this sector is described as an engine of rural development and social welfare.
The enterprises of public sector are unique. when compared to their counterpart in private
sector in the sense that the former have to bear greater social obligation apart from displaying
good performance to secure reasonable profits, which being on important concern of the
private enterprises. The public sector undertakings emerge very significant in the Indian
context by fulfilling various social obligations such as ;generation of employment for mass,
provision of basic infrastructure and public utilities, protecting the consumers from being
exploited, promoting backward regions of the country and achieving balanced regional
development. The public sector had received the best attention from the national, planner and
Government during the I960s and I970s. However, from the late 80s. the public sector
enterprises have become objects of controversy and criticism. The great push given to the
public sector in the initial Live Year Plans did start to recede. This paradigm shift can be
attributed to the overwhelming public orientation, namely to Page 1 91 serve the social
purpose than to run them as profit making apparatus as in the private sector (Vaidvanathan &
Sundar, 201 I). The public sector in India is composed of a number of segments. The first is
government itself i.e. the central, slate and local governments; the second category is that of
departmental enterprises which are run directly by government departments and are not
separately incorporated. This category includes enterprises such as the railways, the post
office and the telecommunication system. The third category is of "non-departmental
enterprises' which are separately incorporated and run as independent companies. This
category includes both manufacturing and non-manulaclLn'ing enterprises
(bttpa/vwco.rakeshmuhan.com). 1. Maximizing the Rate of Economic Growth Originally, the
activity of the public sector enterprises was to be limited to a definite field of basic and key
industries of strategic importance. there were certain fields where the private enterprise was
shy to operate as they involved huge investment or risk. It was the public sector alone which
could build the economic overheads such as power. transport, etc. Since then, the ideological
objective of capturing the 'comrnanding heights" by the public-sector has been duly fulfilled,
it has succeeded in creating the necessary initastruetural base to sustain industrial growth. It
has tremendously boosted the technologica[ capabilities. The public enterprises have firmly
established the foundation for construction of a self-generating industrial economy. During a
planned era, the public sector hasdiversified its activities to cover a wide spectrum of
industries. 'tic public sector today has entered into the production of consumer goods such as
bread, paper, watches. scooters. T.V. and transistor parts, cement, drugs, etc. 2. Development
of Capital-Intensive Sector Industrial development of a country necessitates the foundation of
an infrastructure base. This foundation is provided by the development of capitalintensive
industries and the basic infrastructure. The private sector neither has the zeal Page, 92 nor the
capacity to in est in such infrastructural programmes. From this point of view, the public
sector has a magnificent record. The State has successfully implemented various schemes of
multi-purpose river projects. hydroelectric projects, transport and communication. atomic
power. steel. etc. It has vastly contributed in the fields such as nuclear or steel technology.
aeronautics, and defence materials, ship-building and so on. It has laid down a good network
ot'transport and communications. 3. Development of Agriculture The public sector has an
important role in the field of agriculture as «ell. The public sector assists in the manufacture
of fertilizers, pesticides. insecticides and mechanical implements used in agriculture. Through
the various research institutes the public sector has augmented agricultural productivity by
introducing new highyielding variety of seeds. preventing crop diseases and innovating new
agricultural practices. 4. Balanced Regional Development During pre-independence period a
major problem as regional economic disparities. There were certain areas \\-here there was a
heavy concentration of industrial activity. On the other hand, there were certain backward
areas which went without industries. Industrial development was highly lopsided, but
Maharashtra. W 'est Bengal. Gujarat and Tamil Nadu. etc. were highly developed
industrially. States like Orissa. Assam, Bihar. Madhva Pradesh etc. vvere highly backward.
Besides, industries used to be gravitated to\\ards the metropolitan areas, rather than the
smaller towns. But imbalanced economic development is as bad as underdevelopment.
Through the extension of' public sector enterprises the Government desired to remove such
regional imbalances. The State. consequently, participated in the industrial growth of the less
developed areas by setting up public enterprises. Normally the private sector cannot be
induced to start industries in the backward areas. While locating new public enterprises
claims of the relatively backward areas are given due consideration. The policy of dispersal
of Industries aims at removing Page 1 93 regional disparities. A conscious attempt has been
made-in the successive five-year plans to accelerate the development of relatively backward
areas. 5. Development of Ancillary Industries I'stahlishment of' a few big public enterprises is
not enough to unleash forces of industrial development in an area. There are states like
Bihar \\-here in spite of la\ ish public sector investment: industrial development has not been
satisfactory. On the other hand, states like Punjab have made a vast progress because of the
development of small and ancillary units. This realization made the public sector to take a
close interest in the development of small and ancillary units. It is expected that the
development of ancillaries Would make the way for rapid industrial growth of a region and
lead to balanced economic development. The number of such ancillary units was 432 in
1974-75 and the number rose to 888 in 1979-80 with purchases from them increasing from
Rs. 29 crores to Rs. 120 crores. It is expected that in future, ancillary development would
receive more attention from the Government. 6. Increasing Employment Opportunities The
growth of the public sector has led to the expression of gainful employment opportunities. In
addition to the primary effect of the public sector in creating employ nient opportunities,
public sector investments also have a multiplier effect on other sectors of the economy. This
has a beneficial effect on the total employment position. 7. Model Employer R.K. Gupta has
observed that in India "the State has inaugurated the era of the model employer in contrast to
the employer with a feudal outlook. It has laid down guidelines for employer-employee
relations and for developing good and efficient personnel." the public sector has been the
pacesetter in the field of labour welfare and social security. The State aims at establishing an
industrial democracy which will provide a fair deal to the workers. The public enterprises
have been investing liberally Page 194 on matters pertaining to labour welfare and social
security. Not only the wages have been substantially increased, conditions of service have
vastly improved. For instance, ~vages in the coal industry have nearly trebled since
nationalization and many other amenities are also being provided. 8. Preventing
Concentration of Economic Power Preventing private monopolies and concentration of
economic power is the avowed objective of our economic policy. Nationalization is
considered as an antidote for the concentration of economic power in private hands. In India,
the public sector enterprises have grown. both, in number and in strength. Today, the public
sector not only occupies the commanding heights in the economy, it has also penetrated into
the production of essential consumer goods. The share of the public sector in the overall
industrial production. has substantially gone up. This has effectively curbed the concentration
of economic power. It has created a countervailing force against the growth of larger
industrial houses. 9. Export Promotion The public sector enterprises are substantially
contributing to the country's export earnings. ihe public sector has-built up a reputation
abroad in selling plants. heavy equipment. machine tools and other industrial products. It has
created goodwill in the third world countries for its consultancy, services and technical
knowledge. Public sector exports also include consumer goods. The role of the State Trading
Corporation and the Minerals and Metals Trading Corporation has been quite creditable in
promoting exports. 10. Import Substitution 'I he public sector enterprises have succeeded in
their efforts in import substitution. Today mall\- commodities starting from basic drugs to
highly advanced equipments are manufactured in the public sector, which previously used to
be imported from abroad. In certain tields public enterprises were specially started to Page !
95 reduce imports from abroad and achieve self-sufficiency. Public enterprises like llindustan
Antibiotics Ltd. or Bharat Electronics Ltd. or llindustan Machine Tools etc., have done a
remarkable job in import substitution. This has resulted in saving of precious foreign
exchange. Today. there is a special drive in the public enterprises to utilize indi tenous
materials and domestic skill. 11. Production and Sales While taking up the production Of any
goods or services, the private entrepreneur is guided solely b\ the profit motive. To maximize
profit, he even does not hesitate to exploit the consumers. Very often maximization of profit
is achieved at the cost of public welfare. It is only the public sector which can produce
according to special needs. Sometimes it may even sell at a price lower than its cost. The total
turnover of the State-o\\ ned manufacturing enterprises and service enterprises amounted to
Rs. 2.650 crores in 1969-70. Total turnover of these enterprises increased to Rs. 3644.3 crore
in 1981-82. This indicates that the contribution of the public sector to the flow of goods and
services in the economy was quite considerable. 12. Mobilization of resources The public
sector undertakings have played an important role in financing the planned development of
the country. lhev have significantly contributed to the Central Exchequer in the form of'
interest and various taxes. etc. Besides, public enterprises shows an increasing trend in the
generation of internal resources. From Rs. 194 crores in 1969-70. it increased to Rs. 5.068
crores in 1986-87. In the total capital formation of the country, more than 50 percent is
contributed h' the public sector. 13. Research and Development Toda\ . no country Can
industriall\ prosper ithout research and de\ elopnient. Such research is highl essential for the
introduction of new goods and new technologies of production. lowering the cost of
production and improving the quality of' the product. In this respect, the public sector is
playing a crucial role. A lot of Page ' 96 research activities are being carried on in the
laboratories of the public sector undertakings. 1.1. Establishment of a Socialist Pattern In
India. the public sector was desired to he extended rapidly so as to establish a socialist pattern
of economy. 'There was abject misery and poverty all around prior to the adoption of
planning. Through planned efforts it not only wanted rapid economic growth but also social
justice. The public enterprises aims at achieving equality of opportunity and reduction of
economic inequalities. (http: \v .publishyourarticles.net). Role Public Sector Undertakings-
General Perspective Gov ernment of India. as part of its national agenda. i.e. to promote
growth. increase in efficiency and international competitiveness, has been continuously
framing policies for industrial growth. fiscal, trade and foreign investment to achieve overall
socio-economic development of the country. As a result of exceptionally severe balance of
payments and fiscal crisis in the year 1991. the government decided to shift to a liberalized
economy with greater reliance upon market forces and a larger role for the private sector
including, foreign direct investment. The Government realized that a strongly developed and
growth oriented nation Could be built it' India _rows as part of the world economy and not in
isolation. Thus, liberalizing and deregulatory steps were initiated from the year 1991
onwards, which aimed at supporting growth and integration with the global economy. Since
then, the thrust of New Economic Policy has been on progressive reforms such as reduction
in the scope of industrial licensing, reforms in the Monopolies and Restrictive Trade Practices
Act, reduction of areas reserved exclusively for public sector, disinvestment of equity of
selected public sector enterprises . enhancing limits of foreign equity participation in
domestic industrial undertakings. liberalization of trade and exchange rate policies,
rationalization and reduction of customs and excise duties and personal and corporate income
taxes, promoting FIJI, investments from Page 1 97 NRIs ('\on-Resident Indians), extension of
the scope of CENVAT, implementing the \'AT regime in States, taking steps to switch over to
goods and services tax system w.e.f. 01.04.2010. e-governance and simplification of various
procedures, rules and regulations etc. Since the setting up of \World Trade Organization
(W'I'O) as an apex hod' at the international level, to which India is a signatory, the world
trade has detlnitel grown. thereby giving indications that international trade reforms do play
an important role in boosting economic development of various countries. Industrial policy
has seen a great change with most of' the Central Government industrial Controls being
liquidated. The Central Public Sector Enterprises (CPSEs) were classified into 'strategic' and
'non-strategic'. Strategic CPSl:s were identified in the areas or (a) Arms and Ammunition and
the allied items of defense equipments, defence air-crafts and warships: (h) Atomic Energy
(except in the areas related to the operation of nuclear power and applications of radiation
and radio-isotopes to agriculture, medicine and non-strategic industries): and (c) Railway
transport. All other CPSEs were considered as non-strategic. Further. Industrial licensing by
the Central Government has been almost abolished except for a fv hazardous and
environmentally sensitive industries. (http: dpe.nic.in). Objectives of Public Sector
Enterprises in India Although no specific objective is laid down on a 'White paper' or on a
national document. One can gather together a set of objectives of the Public Sector from
official documents from time to time. The Principal Objectives of Public enterprises are as
follows: ❖ Help in the rapid economic growth. and industrialisation of the country and
creation of the necessary infrastructure for economic development ❖ Earn return on
investment and thus, generate resources for development ❖ Promote redistribution of income
and wealth ••• Create employment opportunities Page 98 •• Promote balanced regional
development ❖ Assist in the development of small scale and ancillary industries o• Promote
import substitutions, save and earn foreign exchange forthe economy. (http:
%ishodhganga.inflibnet.ac.in). Memorandum of Understanding (Mott) A `IOL was signed by
the followintz 21 CPSLs under Dill with the Government of India for the year 2010-1 1 : 1. I
lindustan Paper Corporation Limited (IIPC) 2. Nepa Limited (N EPA) 3. Bharat I3hari Udyog
Nigam Limited (I313LUNI.) Ilolding Company 4. 1 lindustan Photo Films Manufacturing
Co. Limited (E-1PI ) 5. Rajasthan Electronics & Instruments Limited (IZI;IL) 6.
Instrumentation Limited. Kota (ILK) 7. E-I M M r I .td. 8. l h re Corporation of India Ltd.
(ICIL) 9. Scooters India Limited (SII.) 10. 1 lindustan Salts Limited (IISL) 11. C ement
Corporation of India Limited (CCI) 12. 1-lindustan Cables Limited (E-ICL) 13. Engineering
Projects (India) Ltd. (EPI) 14. 1 leavy Engineering Corporation (1-IEC) Page 1 99 15. Bharat
pumps & Compressor Limited (BPCL) 16. Richardson and Cruddas Limited (R&C) 17.
Bridge &: Root Co. (1) Limited (BKR ) 18. 1'ungahhadra Steel Products Limited (TSPI.) 19.
Andrew Yule & Co. Ltd. (,AYCI.) 20. I3harat Ileav\ Iiectricals Limited (BI IEL) 21. 1 riveni
Structurals Limited (I SL) 1O) documents bring out quantifiable targets in respect of various
parameters of performance measures to be taken by the enterprises to achieve these targets
and the assistance to be provided by the Government. A High Level Committee under the
chairmanship of Cabinet Secretary also evaluates the performance of the \lot: signing CPSEs
(http:''dlli.nic.ini). Sick Public Sector Enterprises As documented earlier, a relative and
orderly process for dealing with sick PSLs has been put in motion and the National Renewal
Fund is being set up. However, this is a very complex issue which requires more organized
thinking. The quick exit route propagated by many analysts and commentators is not a
realistic option. In the case of Germany. for example. the quick privatization and closure
route followed by the Freehand is reported to have cost about US S 170 billion and the loss
of' almost half of the existing employment in East German PSF.s. Such large fiscal and social
costs have been feasible to sustain only the kind of resources available with the Federal
Republic of Germany. The strong social security system o1 \Vest Germany' was extended
fully to East Germany. Similarly. China is also facing great difficulty in restructuring of its
own loss making: PSLs. Recent reports suggest that as open unemployment is making its felt
in the urban areas ol'China. the Government is increasingly reluctant to Page ' 100 add to
such unemployment by a wholesale retrenchment of the surplus work force in the PSEs. The
rise in inflation is being attributed in increasing fiscal deficit suffered by the Cio\ ernment as
it pumps in resources to keep up employment in loss making overmanned PSEs. The problem
in India is. on the one hand, not as serious as in these countries because PSEs form only a
small part of the total industrial economy. On the other hand. the low income level of the
country and the lack of a social security system, dealing with large layoffs in the organized
sector is not politically or socially sustainable. The problems are somewhat exacerbated with
the relative concentration of' sick PSLs in the Eastern region of India. About half of the
employees in sick PSFs are in the Eastern region of the country. This proportion increases to
almost two thirds if the loss making non sick PSEs are added. The response to this complex
issue. therefore. has to he carefully engineered and sensitively implemented. As the I31FR
process unfolds concentrated attention on the areas where industrial distress is likely to take
place is required. The National Renewal Fund mechanism could be strengthened either in its
existing, form or if it is found to be in adequate. new mechanisms could be organized. This
would need a combination of reasonably generous compensation payments to workers.
counseling, retraining and redeployment, along with focused programmes of employment
generation through industrial regeneration. The skills embodied in these industrial workers
must be seen as assets which need better utilization. With the rising trend of industrial
investment and production overall, it should also be feasible to encourage new industrial
investment in the areas that are most affected by industrial distress. If there is clear
recognition of the desirability of eventual closure of essentially bankrupt enterprises, it would
be feasible to organize a time bound realistic programme of' restructuring which would take
care of' the industrial issues arising from such closures as well as the welfare issues With
regard to labour. For the future, a self financing unemployment insurance fund is a necessity
for continuous labor restructure. (http: ; \vww.rakeshnlohan.com). Page 101 History of Public
Sector Undertakings Navratna as the title given originally to nine Public Sector Enterprises
identified by the Government ol India in 1997 as public sector companies that have
comparative advantages, giving them greater autonomy to compete in the global market so as
to "support them in their drive to become global giants". The number of PSEs having
Navratna status has been raised to 16. the most recent addition being Oil India Limited. PSL
companies are divided into thrcc categories: :• Navratna •:• IVliniratna CPSEs ❖ Category I
•:• Category II •:• Maharatna status In 2009, the government established the Maharatna
status. hich raises a company's investment ceiling from Rs. 1,000 crore to Rs. 5,000 crore.
The Maharatna firms can decide on investments Of up to I - per cent of their net worth in a
project and the \avaratna companies could invest up to Rs 1.000 crore without explicit
government approval. Criteria l he six criteria for eligibility as Maharatna are: •:• Ilaying
Navratna status. •:• Listed on Indian stock exchange with minimum prescribed public
shareholding under SERI regulations. ❖ An average annual turnover of more than Rs. 20.000
crore during: the ❖ Maharatna last 3 ,ears. Earlier it was Rs 25.000 Crore. •:• An average
annual net \corth of more than Rs. 10.000 crore during the last 3 years. Earlier, it was Rs.
15,000 crore. °• An average annual net profit after tax of more than Rs. 2500 crore during the
last 3 \-ears. Earlier, it was Rs. 5000 crore. •:• Should have significant global presence or
international operations. Page 1 102 List of \laharatna ❖ Coal India limited •:• Indian Oil
Corporation Limited •:• N I PC Limited •:• Oil and Natural Gas Corporation Limited •:• Steel
Authority of India Limited Navratna status Navratna was the title given originally to nine
Public Sector Enterprises (PSEs). identified b the Government of India in 1997 as having
comparative advantages, which allowed them greater autonomy to compete in the global
market. The number of I'Sl:s having Navratna status has been raised to 16. The government is
likely to accord the coveted status to mishra dhati nigam limited, which is under
consideration. list of N.. VRA"TNAs ❖ Bharat Heavy Electricals Limited + Bharat
Electronics Limited ❖ Bharat Petroleum Corporation Limited ❖ I Iindustan Aeronautics
Limited :• Hindustan Petroleum Corporation Limited ❖ Mahanagar Telephone Nigam
Limited ❖ National Aluminium Company Limited •:• National Mineral Development
Corporation Limited •:• Nev veli Lignite Corporation Limited ❖ Oil India Limited •:• I'o ver
Finance Corporation Limited •:• Power Grid Corporation of India Limited •:• Rashtriya Ispat
Nigam Limited ❖ Rural Electrification Corporation Limited •:• Shipping Corporation of
India Limited ❖ Gas Authority of India Limited Page ' 103 Miniratna Status In addition.
the ,_,ov crnment created another category called Nliniratna. Miniratnas can also enter into
joint ventures, set subsidiary companies and overseas offices but with certain conditions. In
2002. there were 61 government enterprises that were awarded Nliniratna status. Howe\er. at
present. there are 68 `(government enterprises that were awarded Miniratna status. CategorNI
This designation applies to PSI:s that have made profits continuously for the last three years
or earned a net profit of Rs. 30 crore or more in one of the three years. l hese miniratnas
granted certain autonomy like incurring capital expenditure without government approval up
to Rs. 500 crore or equal to their net worth, whichever is lower. ❖ Projects & Development
India limited :• Airports :Authority of India ❖ :\ntrix Corporation Limited •:• Balmer Lawrie
& Co. Limited ❖ Bharat Dynamics Limited •:• BFAII. Limited •:• I3harat Sanchar Nigam
Limited •:• Bridge & Roof Company (India) Limited •:• Central \V arehouslng Corporation
❖ Central Coalfields Limited ❖ Chennai Petroleum Corporation Limited ❖ Cochin
Shipyard limited •: Container Corporation of India Limited •:• Dredging Corporation of India
Limited •'• Fngineers India Limited :• Ennore Port Limited •:• Garden Reach Shipbuilders &
Engineers Limited •:• (ioa Shipyard Limited Page 1 104 •:• I lindustan Copper Limited •:•
HLI. Life care Limited ❖ I lindustan Newsprint Limited •:• I-lindustan Paper Corporation
Limited •:• I lousing and t 'rhan Development Corporation •:• India "tourism Development
Corporation :• Indian Railh\av Catering and Tourism Corporation ❖ IRCON International
Limited •• Kudremmkh Iron Ore Company Limited. ❖ Mazagaon Dock Limited •:• \lahanadi
Coalfields Limited ❖ Manganese Ore (India) Limited •:• Mangalore Refinery and
Petrochemicals Limited •:• Mishra Dhatu Nigam Limited ❖ Minerals and Metals Trading
Corporation of India ❖ \1S"I C Limited •:• National Fertilizers Limited ❖ National Seeds
Corporation Limited •:• NIIPC Limited •:• Northern Coalfields Limited •:• Numaligarh
Refinery Limited •:• ONGC Videsh Limited •:• Paean Hans I-Idlicopters •:• Rashtriva
Chemicals & Fertilizers Limited •:• RITES Limited •:• Satluj Jal Vidyut Nigam •:• Security
Printing and Minting Corporation o(' India Limited •:• South Eastern Coalfields Limited •.•
State Trading Corporation of India Limiter. ❖ l'ehri Hv dro Development Corporation
Limited ❖ l elecommunications Consultants (India) Limited •:• \Vcstcrn Coalfields Limited
Page 1 105 ❖ \Vater & Po%ver Consultancy ( India) Limited :• RailTel Corporation of India
Ltd. ❖ Broadcast Engineering Consultants (1) Limited •:• Central Mine Plannine & Design
Institute Limited •:• Ld.CIL (India) Limited + Engineering Projects (India) Limited •:• FCI
Aravali C;vpsum & Minerals India Limited •:• l erro Scrap Nigam Limited ❖ I INI I
(International) Limited ❖ HSCC (India) Limited •:• India Trade Promotion Organisation •:•
Indian Medicines & Pharmaceuticals Corporation Limited •:• M F C 0 N Limited •:• National
I ilm Uevelopment Corporation Limited •:• National Small Industries Corporation Limited •:
P 1: C Limited 67. Rajasthan Electronics & Instruments Limited (www.w ikipidia.com ).
Growth of Public Sector in India At the time of Independence. India was basically an
agricultural economy with weak industrial base, low level of savings and Investment and
lacks infrastructure. A vast majority of population was extremely poor. There were
considerable inequalities in income. employment opportunities were low and serious regional
imbalances were noticeable in economic attainments. It was felt obvious that if the Country
as to speed up its economic grey\\th and maintain it in the long run at steady level, a big
'push' With State Initiative is an essential pre-requisite. Besides, the Industrial Policy
Resolution. 1948 laid down that the manufacture of arms and ammunition, the production and
control of Atomic energy, ownership and management of Railway Transport should be in
exclusive monopoly of the Central Government. By doing so. it has sown the seeds for the
growth of Public sector. The ('onstitution of India. adopted on 26th' January 1950. directs the
State under Article 39(b) and (c) to secure that the ownership and control of' the material
Page 1 106 resources of the community are so distributed as best to sub serve the common
good and that system does not result in the concentration of wealth and means of production
to the common detriment. (http:/'%shodhganga.In111bnet.ac.ln). Problems Faced Iii Public
Sector Enterprises in India The most important criticism levied against the Public Sector has
been that. in relation to the capital employed, the level of profits has been too low. Even the
Government of India has criticized the performance of the Public Sector Enterprises. For
Instance. the Eighth Five Year Plan notes that the Public Sector has been unable to generate
adequate resources for sustaining the growth process. Moreover, the poor performance in
Public Sector Enterprises is due to a host of problems which may be classified into financial
and non-financial problems based on various studies. Some of the problems can he enlisted as
follows: 1. Under utilization of installed capacity is a major reason for the low level of
profitability and poor performance in Public Sector Enterprises particularly in case of capital
intensive units. A large number of these enterprises have operated less than 50 per cent of
their capacity for a number of years. It affected the operational efficiency of' the enterprises.
II. Generally, prices are determined at a level that Would cover total cost and provide a
sufficient net return over and above this. As against this, the pricing policy is determined by
the political and social objectives rather than financial objectives Lack of rational pricing
policy has resulted in poor profitability and has left little profits for financing the expansion
programme. III. Most Public Sector Enterprises are over-capitalized and hence, productivity
of capital is low due to poor planning heavy expenditure during construction and wrong
selection of project sites and allocation of funds on non-productive heads. IV. Excessive
dependence on external sources of fund and consequent Interest payment obligations affected
the commercial viability of most Public Sector Page 1 107 enterprises. The poor generation
of internal source is attributed to the poor financial pertiormance of these Enterprise. V. l oor
planning and delay in implementation of projects resulted in raise in the cost of the project.
Cost escalation was due to changes in project sites. Sometimes. due to a belated recognition
of product mix that IS unsuitable to Indian market conditions. The projects behind the
schedule is leading to the makin of most project nonviable. VI. I he Failure to get adequate
return on the huge Public Sector Investment has been a major contributing factor towards the
recent fiscal and foreign exchange crisis which has put severe strains on the Indian economy.
VII. Lack of autonomy and political considerations tilling top management position and
frequent interference in to the affairs of day to day administration by respective ministries
reduced the flexibility in taking up commercially viable decisions and thereby include large
amount of' opportunity losses. l bus. it is e' ident that Public Sector Enterprises were incurring
losses continuously due to the presence of numerous financial and non-financial problems.
Besides, one essential cause tier the losses incurred by these enterprises is the poor operating
and financial performance: of these enterprises at the same time. Policy makers, bureaucrats.
managers and also researchers have not given due weightage and importance on this problem.
Hence, this present study is planned to explore in to this dimension. (http:': shodh an
a.inilihnet.ac.in). Challenges and Solutions in the Public Sector the public sector industry is
rapidl\ transforming. Many reforms take place to anticipate on several challenges. At the
moment, several trends can be detected within the public sector. "Ihe origin of these trends
can be found in the ongoing introduction of' public management methods and tools within the
public sector. "I'he government of' the future will he an cffecti\e. cost efficient and
accountable government that delivers high quality services. Page 108 Deloitte offers and
solutions for all government levels have faced the same set of challenges. The Deloitte
experts ha\e build up a specific kno\\ledge and expertise on the public sector industry which
is an essential kcv driver fbr a successful implementation. 1. \lore Attention towards Policy
Preparation and Evaluation II erIllnents \\ant to have major impact. tile\- need to take
decisions based on well thoucht visions. They have to understand the current day situation,
the potential needs evolutions and the agendas of all relevant stakeholders. Based on scenario
building. they have to take decisions on pursued strategy to build the p1att'0rmMs to execute
and monitor the outcomes and the impact of the government role. Solution: Policy
Preparation and Evaluation Deloitte has a team of policy advisors experienced in the
preparation as \\ell as the evaluation of policies. The team specialized in evaluation
methodologies on one hand and in specific domains such as health care, home land security,
food safety and innovation on the other hand. 2. More Regulatory Impact in a Complex
Society All kATective `11oveI'llIIIent is a good instrument that safeguard the wellbeing III
our society . The complex society needs an intelligent government that supports opportunities
for further growth towards a harmonious organization and an effective and safe society.
Regulator \ issues should ha \ e a positive impact on these ambitions. Solution: Regulation
Impact Strategies Deloitte has a team of high profiles capable to elaborate effective and
efficient solutions With impact and adapted for a complex. flexible and ever changing
society. 3. New Delivery via Partnerships \ohialien of acti\ ities. industrial production
methods and the complexity of the industrial society has a consequence that governments can
no longer have the monopoly in safeguarding security on products and services and
protection of the rights of the citizens. Page 1109 Government can no longer have the
ambition to accumulate all needed knowledge and budgets. To sale:guard the positive impact.
the governments have to elaborate new collaboration models with different stakeholders and
private partners. Controlled trust and respect instead of distrust should be the main driver in
the relation between `go\ ernment. citizens and companies. Solutions: PPP and other
collaboration models PPP is toda\ established as a means for public service delivery. Deloitte
is involved in the organization and advisory of important PPP structures. In case of inspection
activities, government has to create partnerships with loyal enterprises. 4. Be a Role Model in
Compliance Not only citizens and companies, but also governments have to be compliance
with all rules and regulations set out by the Europeon Union. National. Regional and local
political bodies. All administrations should comply with all stipulations in domains as tax.
financial reporting. pri\acy regulations, specific administrative laws and regulations.
Solutions: Statuary audit and compliance audit in tax, legal and administrative regulated
domains. Deloitte has a multi disciplinary team with deep expertise in complex statuary
audits for large public and private organizations, hospitals and non for profit organizations.
With the legal, tax and financial government experts Deloitte can build a standardized
approach in compliance testing and advisory in the all strategic domains With compliance
issues, he it social and financial reporting, tax, privacy regulations. ser\ ices directives and
other administrative regulations and reporting needs. 5. Attention on Good Government
Governance Reliability. transparency and accountability are key words for a government with
visible impact in very skeptical and media oriented society. Identification of clear objectives,
development of transparent processes. adapted checks and balances. accountability and
communication should he close at heart for all administrations. Page 1110 Solutions:
Evaluation and Advisor-on Governance and Internal Audit Based on the global expertise, the
team developed a multi disciplinary methodology to scan the level o1 good governance of
government bodies. Based on the best practice models. they can elaborate adapted
governance models, on the strategic level as well as on the operational level. Deloitte has a
team of expertise implementing internal audits within the public sector environment. 6.
Integration of Risk Management and Business Continuity Planning Relevant governments
should manage in a professional way. A good and formalized view on the different risks and
risk levels is important. These insights should steer the strategic planning and management
cycles within the administrations. Also relevant government bodies should make a business
continuity plan to "stay in business" in all circumstances Solutions: Risk Management and
Business Continuity Planning For many \ears. l)eloitte plays a prominent role in the
development of the concepts of' risk management and business Continuity planning. I he
private sector expertise has been translated towards the public sector. 7. Building the Public
Sector Landscape of the Future Io increase impact in society. to perform in an efficient %\a\
and to cope with the complexity of products and services, administrators are developing new
concepts of open organization, new collaboration models between administrations of similar
level. between administrations of different governance levels and between public and private
organizations will have an impact on the organizations design of the overall public sector.
The refer concepts as PPP. auto control systems. contracting with industries. They refer as
well to new Iunctionalities in domains as CRM and inspection of data mining activities
overlapping different administrations and aiming at more accurate risk approach. They all
have to be positioned within the government structures. Solutions: Strategic Organization
Design and shared Services Due to depth vie of the public sector based on good practice
models in other countries. They can assist the governments in the strategic organization
design of the Page 1111 public sector and the creation of shared services in domains as HR
and Finance Procurement. In domains as health care, home land security and financial
industry, they have experience on how to organize the related government bodies and how to
create added value communities integrating the related government bodies and external
stakeholders. 8. Design of Efficient Processes All administrations do have a continued need
for optimizing the processes adapting to the specific strategy. legal changes. innovation, new
services and delivery nl0Jels. Solution: RPM and Process Engineering Deloitte has a long
standing reputation in process engineering within all levels of government. They integrate the
deep insights in all functional processes in public sector HR. IC'I'. Finance. CRM.
Procurement, internal communication and inspections services. Based on our important
Involvement in different engineering exercises we have good views on all process flows
within the local sector. During the design of the processes. they integrate the insights in legal
aspects (eg privacy), best practices and risk management. They document the processes in
adapted BPM1 tools. 9. Manage the Conlplexit A relevant government is launching new
ideas and projects. Within the concept of the networking government, these projects are
becoming more and more complex. More stakeholders and complex ICT solutions have
attention on internal and externals cOt1lnMLinIeatl0tl. Solution: Project Management
Deloitte Belgium had the opportunity to build an important experience in the management of
complex projects for the private sector and the European 1- pion. They combine this
knowledge with the experience .Deloitte has built in the management of large scale
government programs in different countries. Page 1 112 10. Implement Efficiency .1n
efficient government should look for standardized solutions in domains as finance, human
resources. ('RM and procurement adapted to the specific public sector en% Ironment.
Solution: I:RP solutions l)cloittc Belgium has been involved in the implementation of FRP
systems for the public sector on ditYerent levels of administration. They are building further
on the standardized solutions. integrating the latest technologies and the multi disciplinary
competencies (risk management. tax and legal). Solution: Accounting and Administrative
Support The integrated scry ice offering is supporting governments in running their
administrative. (http: '\v1vww .deloitte.conl ) Causes for the Expansion of Public Enterprise
At the time of independence. India was backward and underdeveloped basically an agrarian
eeononl\ with weak industrial base, high rate of unemployment, low level of savings and
investment and near absence of infrastructural facilities. Indian economy needed a big push.
This push could not come from the private sector because of the lack of funds and their
inability to take risk with large long-gestation investments. As such. government intervention
through public sector was necessary for self-reliant economic growth. to diversify the
economy and to overcome economic and social backwardness. The rationale or causes for the
expansion of public sector enterprises in India are discussed below: 1. Rate of Economic
Development and Public Enterprises: 'l'he justification for public enterprises in India as based
on the tact that the targeted rate of economic growth planned by the government was much
higher than could be achieved by the private sector alone. In other words, the public sector
was Pages 113 essential to realize the target of high growth rate deliberately fixed by the
government. 2. Pattern of Resource Allocation and Public Enterprises: Another reason for the
expansion of the public sector lies in the pattern of resources allocation decided upon tender
the plans. In the Second Plan, the emphasis was shifted to industries mining, and mainly basic
capital goods industries to be developed under the aegis of the public sector. Thus. more
resources for industrialization \\ere funneled through the public sector. 3. Removal of
Regional Disparities through Public Enterprises: Another important reason for the expansion
of the public sector was the need for balanced development in different parts of the country
and to see that there were no serious regional disparities. Public enterprises were set up in
those regions which %sere underdeveloped and \\, here local resources ere not adequate.
Good examples are the setting up of the three steel plants of Bhillai, Rourkela and 1)urgapur
and the Nevveli Project in Madras which were meant to help industrialize the regions
surrounding the projects. 4. Sources of Funds for Economic Development: Initially. state was
an important source of funds for development. Tile surplus of government enterprises could
be re-invested in the same industries or used for the establishment and expansion of other
industries. Profits of public sector industries can be directly used for capital formation which
is necessary for the rapid development of the countr\ . 5. Socialistic Pattern of' Society: The
socialistic pattern of' society envisaged in the Constitution calls for expansion of public
sector. The production will have to be centrally planned as regards the type of goods to be
produced. the volume of output and the timing of' their production. Besides, one of the
objectives of the directive principles of' the Indian Constitution is to bring about reduction of
the inequalities of income and wealth and to establish an egalitarian society. The Five Year
Plans have taken this up as a major objective of planning. The public enterprises were used as
major instruments for the reduction of inequalities of income and to bring about a more
equitable distribution of income in several ways. Pagel 114 6. Limitations and Abuses of the
Private Sector: The behavior and attitude of the private sector itself was an important factor
responsible for the expansion of the public sector in the country. In many cases. the private
sector could not take initiatives because of the lack of funds and their inability to take risk
with large long-gestation investments. In a number of cases, the government was forced to
take over a private sector industry or industrial units either in the interest of workers or to
prevent excessive exploitation of consumers. Very often. the private sector did not function
as it should and did not carry out its social responsibilities. Aceorctinglv, the government was
forced to take over or nationalize the private sector units. 7. To sum up. the expansion Of the
public sector as aimed at the fulfillment of the national goals. viz.. the removal of poverty, the
attainment of sell-reliance, reduction in inequalities of Income, expansion of employment
opportunities, removal of regional imbalances, acceleration of the pace of agricultural and
industrial develop mcnt, to reduce concentration of ownership . prevent growth of
monopolistic tendencies by acting; as effective countervailing power to the private sector, to
make the country self-reliant in modern technology and create professional. technological and
managerial cadres so as to ultimately rid the country from dependence on foreign aid.
(http:l/www.trcollege.net). This Chapter deals \\ ith the development of Public Sector
Undertakings. The succeeding chapter deals \p ith a profile of' Public Sector Undertakings- A
case study of BHE1.. Page j 115 References Department of Public Enterprises. (2007). 2nd
Pay Revision Committee Report. Retrieved from
http://dpe.nic.inipublications/2nd_pay_revision_committee_ report Khanna R.. "What is the
role of Public Sector Enterprises in India?" Retrieved from http:l/www.publ ish yo urartic les.
net/knowledge-lm b/company-account s Mohan, R., "Public Sector Reform And Issues In
Privatization" Retrieved from http:www.rakestunohau.cotnidoes/ 123-CD2.doc Public Sector
in India. Retrieved from: http:/Jwww.lmollege.net/study-material/34- e c on o m i csi ind u st
ri a l-e c onom i s s/ 61-public-sector-in -i nd i s Public Sector, Challenges and solutions in
the public sector. Retrieved from htlp!/www.bsepsu.coin/2-I_Historyasp. Govt of India
outcome budget 2011-2012 Ministry of Heavy Industries & Public Enterprises. Retrieved
from http://dhi.nic.in/dhi outcome budget 11 12.pdf Navratna, Retrieved from
www.wikipidia.com Parm (28 may, 2012). "The role of Public Sector Undertaking in our
National Economy". Retrieved from httpilwww.wikistreets.eomicoflegeessays Seetharaman,
V. P. (2000). Financial perfornianace of public sector enterprises in India: a study on select
heavy and medium engineering entcrprises.(1hesis, Pondicherry University). Retrieved from
http://shodhganga.infli6net.nc.im handle! 10603il208/8/08_chapter°/v201_pdf Vaidyanathan,
S. & Sundar, V. (2011), The Role of Public Sector Enterprises in Rural Development and
social welfare". Internaeionii Journal of Managing Public Sector Information and
Communicarion Technologies (LIMLIPICT) Vol 2.1/v. I. PageII16

Philosophy:
Before entering into various aspects of public sector undertaking it is required, for the sake of
clarity, that why the role of government in economic affairs is so much emphasised. To put it
into other words it is not proper for a government to be busy only with the political and
administrative affairs of the state. A modern government must also see that economic affairs
are properly managed.

We quote here few lines from an essay by Richard C. Box “Many citizens are so alienated
from the concept of self-government that they think of government as something separate, not
a reflection of their own will, though some others like to participate directly in re-creating the
machinery of government to allow for genuine self-governance. As a potential remedy, many
politicians and citizens believe that government should be run more like business becoming
thin and lean, exhibiting competitive behaviour and giving the greater attention to the needs
of customers… New public administration (or management) seeks to separate politics (in the
sense of decision-making by the people or their representatives) from administration allowing
(or making) managers to manage according to cost-benefit economic rationality largely, free
from day-to-day democratic oversight.”:

The central idea of the above statement is that the government should be run like a business
organisation. It is because the government is simply a type of business management. It should
be cost efficient. A business cannot run incurring huge loss day after day.

In the same way the manager of state or public administrators must see that the benefit of
administration or the policies of the government must reach the target areas—that is, the
people —for whom the policies are framed. It is also believed that a government of a modern
state need not be preoccupied only with the administrative affairs of the state. It must see also
the economic progress of society Gone are those days when it was thought that the state is
like a night watchmen.
Today’s people say that it is the duty of the state to ensure overall progress of citizens or
society. The pressure of democratic progress has forced the state authority to expand its area
of business which means that the government must do something in the field of growth of
economy.

Needless to say that this new approach to the functioning of the state is diametrically opposite
to neo-liberalism. The government must perform its administrative and policy-making duties.
But simultaneously it should focus its attention on the progress of economy. This is the cost-
benefit approach of new public administration.

The new public administration has also highlighted that the absolute management of
economy by the prime sector has failed to meet the growing and variegated demands of
people in a changing society. Even in mature capitalism economy is faced with repeated
crises which have crippled the economy. This situation compels the state to interfere with the
working of the private sector. It is reasonably believed that the monoply of any one sector is
always unhealthy for the welfare of the people and economic progress.

The Great Depression of 1930s and repeated depressions of 1980s and 1990s have
established the belief that at the time of crisis or necessity the government must interfere with
the free-market functioning. Moreover, a government worthy of its name cannot leave every
aspect of economic activities to the free-market operation concept. It is now believed that
both the private and the government sectors work hand in glove.

This new tendency is widespread today. After the Second World War (1939-1945) the
Labour Party government of Britain nationalised a large number of key industries and
transferred their management to the hands of government officers. That was perhaps the first
instance of transferring the management of big industries from private management to
government control. John Maynerd Keynes, a great British economist, strongly advocated for
expanded role of government in the economic affairs.

From the 1950s large number of countries of Asia and Africa began to earn freedom and to
achieve rapid economic progress they stepped in the method of expanding the role of
government in the field of economic activities. But the role of the private entrepreneurs was
not banned.

The state and non-state organisations must have equal responsibilities in ushering in a new
era of rapid progress. From this basic idea must emerged a new concept. It is called public
sector undertaking. That is, both public and private sectors will work and exist side by side
and the objective of both will be identical. Today we have another concept-public- private
partnership.

Forms of Public Sector Undertakings:

It is the demand of citizens as well as the demand of time that the state should play an active
role in the industrialisation and economic development. Naturally the role of the state has
become an inevitability The natural consequence is that the business enterprises are set-up
under the direct authority of state and these are managed by the rules and procedures made by
the state authority that is legislature.

A critic has observed: “Public sector in India has acquired a prominent place and has
witnessed phenomenal growth during the last fifty years. It accounts for approximately two-
fifth of the total gross investment and contributes approximately a quarter of the GDP”. The
public sector undertaking (PSU), we therefore see, play a very crucial role in the economic
development and industrialisation of India. In 1951 the number of public sector undertakings
was just five. In the middle of the 1990s the number rose to about 250. There was also a
phenomenal rise in the quantum of total investment. A major part of job holders is to be
found in the public sector undertakings.

There are generally four types of public sector undertakings in India.

These are roughly:

(1) Joint Stock companies.

(2) Holding companies.

(3) Departmental form of company and, finally, statutory corporations.

The Joint Stock Company is a general form of public sector undertaking in India. This type of
undertaking is abundantly found in India. The business activities are so common that
administrators and ordinary people are acquainted with this form of business organisation.
There is a lot of .flexibility in the management of this form of undertaking. The flexibility
helps the organisation to cope or adjust with the changed situation.

There are some departmental organisations and it is said that of all forms of undertaking in
public sector these are very old. But these forms of enterprise are not very popular. One
reason is departmental forms of organisations cannot adjust themselves with the changed
situation or are very slow in adjusting themselves.

Another type of public sector undertaking is statutory organisation or corporation. Damodar

Valley Corporation is a statutory corporation and was set up immediately after independence.
It was inaugurated by Jawaharlal Nehru with the help of Budhni Majhi, an adivasi worker, of
the Damodar Valley Corporation. Industrial Finance Corporation is also a corporate type of
public sector undertaking.

Though Railways and Post and Telegraph departments fall under the category of statutory
corporations these are not in the class of Damodar Valley Corporation or Industrial Finance
Corporation. The Railways, Post and Telegraph and The Indian Broadcasting Corporation
claim separate identity in recruitment and management. Today Railways has its own system
of recruitment and management. It is known as Indian Railways Service and it is an All-India
Service.

There is another type of public sector undertaking and it is popularly known as Holding
Company. According to S. R. Maheshwari: “In 1967, the Administrative Reforms
Commission recommended the setting up of “sector corporations” which apparently did not
differ very much from the holding companies. It recommended that all the industrial and
manufacturing concerns in the following areas should be grouped into a sector corporation.”
The manufacturing concerns are: Chemical and drugs, fertilisers, iron and steel, electricals
engineering, petroleum and petrochemicals, iron and steel.

All these different industries or concerns were put under the umbrella of a single management
or organisation. The chief aim was to run or administer all these concerns by certain definite
principles and broad administrative techniques. A little thought will reveal that all the above
noted concerns are key to industrial progress and building up a developed economy of India.
If so, all these concerns must be managed or ought to be administered by a single principle.

The highest advantage of the holding process is the key industries are managed by single or
common laws. A central authority can supervise the functions or management of the concern.
For this purpose the central government formed the Steel Authority of India (SAIL) and Coal
Authority of India (CAIL). In recent years TRAI (Telephone Regulatory Authority of India)
has been formed.

There is another reason. Since all these concerns play very important role in the field of
economic progress there must exist co-ordination, and co-operation. Holding of companies
under single authority will help. In the field of management the principle of co-ordination
plays a very important role.

Problems of PSUs:
Immediately after independence the stalwarts of Indian politics were faced with a dilemma-
whether to adopt the capitalist model of economic growth where the private enterprises will
be controlled by capitalists or to follow the then Soviet model where the State is all-in-all in
the field of economic growth.

Since Nehru was the main determiner of Indian economic system and since he had strong
sympathy for Soviet model the dominant role of the state in the field of economic progress
was finally accepted and was implemented through the introduction of the First Five Year
Plan. Nehru received support from another person —P. C. Mahalanobis —the real architect
of India’s First Five Year Plan.

The first three Five Years Plans progressed smoothly and considerable progress of economy
was witnessed. The whole economy was dominated by public sector. This progress created a
lot of enthusiasm about the success of public sector undertakings. But from the mid-1960s
crisis in economic growth began to surface. Let no put it in the words of Paul Brass: “A
major crisis for the public sector, capital intensive, heavy industrialisation strategy arose
during the discussion surrounding the formulation of the Fourth Five Year Plan (1969-1974)
……………. A further consequence of the loss of momentum in the mid-1960s was an
increasingly evident deceleration in the rate of growth of the economy, traceable primarily to
a decline in the rate of industrial growth. This decline has been attributed to, among other
causes, the slowdown of public investment since the end of the Third Plan, the inefficiency of
the public sector enterprises, and the restriction placed on the private enterprise by
bureaucratically imposed import control procedures designed to ensure priority to the public
sector” We, therefore, conclude that the problems of public sector undertakings began to
emerge since the mid-1960s. A further problem is, this problem has never been solved —
rather it has ramified assuming different forms and nature.

The leaders and policy-makers of Indian economic and political systems were so much
obsessed with the imaginary miracle of public sector’s success that the private sector received
everywhere step motherly behaviour. By the beginning of the 1980s the problems of public
sector undertakings began to be prominent. These problems related to management and
efficiency.
There were losses in large number of public enterprises. It was found that there was
mismanagement and this was primarily due to inefficiency of the bureaucrats. Gradually the
public enterprises were bureaucratised and all the curses of bureaucracy engulfed the public
sector undertakings.

Several factors were present behind this bureaucratisation and the most prominent among
them was the role of ministers. At the head of an enterprise there was a minister. The minister
framed policies and rules of management. The corruption in a public enterprise was also
another problem. Corruption spread its tentacles almost in all branches of enterprises. This
crippled the normal functioning of many enterprises and they began to run in losses. The
government was forced to give huge amount of subsidy to these enterprises.

Problem of Autonomy and Accountability:

ADVERTISEMENTS:

Paul Brass writes: “In the face of the crumbling of the entire structure of public investment
and government regulation of private investments, the old ideological debate between public
and private sector adherents emerged once again with the rise of power of Rajiv Gandhi”.

The implication is the failure of the public enterprises to fulfill the demands of states and
people practically forced the Central Government to reconsider its stand on public
enterprises. It was because the excessive reliance or emphasis on public sector enterprises
was the primary cause of the failure of economy to advance forward. Keeping this in mind
the authority at the central level formed a Committee on Public Undertakings of the Eighth
Lok Sabha. The purpose of this Committee was to study the various aspects of the working of
public enterprises. The Committee submitted its report in 1987.

The Committee investigated the two important aspects of public undertakings— the
autonomy and accountability and after thorough investigation the Committee arrived at the
conclusion that autonomy of the public sector undertakings was essential for the proper
management. The chief executive officer or the top administration of any public enterprise
must have sufficient autonomy in the management of the enterprise or organisation.

This argument of the Committee is really valuable because in private enterprise the chief
executive officers enjoy enough freedom in the day-to-day management of the enterprise. In
the government enterprises the chief executive officers and professional bureaucrats act in the
sense of Weberian bureaucracy.

Their adherence to law is perfect. In India the top officers work under the strict guidance and
authority of the minister. They have very little freedom to do anything or to take any decision
of their own accord. This type of absence of freedom stands on the way of proper and
efficient working of enterprises. It has been alleged that the government very frequently
interferes with the management of enterprises.

The reason put forward by the government is that it is responsible to the legislature for any
lapse or fault. Again, the legislature is accountable to the people for any fault or failure. This
type of argument invariably curtails the freedom of executive officers. Extending the
argument critics say that while the private enterprises are doing their business efficiently, the
state enterprises are doing unsatisfactorily.
In the light of the above analysis the observers argue with confidence that every management
of state enterprise must be allowed to act or take decision freely and it is the most important
pre-condition for the proper and efficient working of state enterprises. The Committee on
Public Enterprises or Undertakings thoroughly investigated the functioning of various state
enterprises and has arrived at the conclusion that these undertaking suffer from lack of
autonomy.

If the public enterprises were allowed to do their jobs with sufficient freedom they can show
good results. The chief executive officers and other organisations frequently allege that the
public sector enterprises badly suffer from autonomy and this condition is dwarfing their
progress. Even the architects of Five Year Plans repeat the same argument.

In order to ensure autonomy it has been suggested that the civil servants should not be
appointed to the posts of executive officers of public sector undertakings. Only professionals
are to be appointed. It means persons having special knowledge in the management of special
type or category of enterprises should be appointed and they should be given sufficient
freedom in discharging their duties. The Administrative Reforms Commission has suggested
that deputing government officers to the top posts of public undertakings should be
discontinued. It is believed that this process affects the autonomy of undertakings.

Apparently there is a conflict between autonomy and accountability. If any organisation

enjoys sufficient autonomy that may curb the accountability. But in reality there is no such
conflict. Autonomy, in reality, means the freedom to take decision and implementing that
decision for the general improvement of the undertaking. But this freedom must not be
misused. That is in the name of freedom to take action or adopt policy for the improvement of
the enterprise the chief executive officer cannot do anything that will go against the interest
of the general public. Autonomy and accountability, in practice, can exist side by side.

It is to be remembered that in democracy people are the supreme authority. The periodical
elections establish this accountability. If the autonomy of the public sectors undertakings
affects the public interests in a large way the ministers must give explanations to the public
on the eve of elections. If there are lapses on the part of ministry the concerned minister must
give explanation. So the ghost of periodical election or democracy forces the government to
keep an eagle’s eye on the functioning of public sector undertakings.

Autonomy and accountability must coexist and this should be the guiding principle of every
public sector undertakings. Recently a new system has been introduced to ensure
accountability. This policy is known as Memorandum of Understanding (MOU). The MOU is
signed between the public sector undertaking and the ministry of government. The subject
matter of MOU is that the public sector enterprises will have sufficient autonomy but that
must not curtail the scope of accountability.

Two concepts-autonomy and accountability have earned special attention in recent years. It
has been repeatedly argued by higher-ups of our society that the managers of public sector
undertakings do not enjoy enough freedom and because of this undertakings are not properly
discharging their responsibilities But some critics have been found to argue that lack of
autonomy is not the only cause of the improper or malfunctioning of public sector
undertakings Question arises about the efficiency of the executive officers. Their inefficient
functioning is also responsible for wrong policy and interference of politics in the field of
administration of public sector undertakings. Politics must be separated from management
and policy making affairs.

PSU, Liberalisation and Privatisation:

In common parlance we very often use the term LPG-one meaning of the term is liquidified
petroleum gas. In politics and economics the term means- Liberalisation, Privatisation and
Globalisation. Since the very commencement of 1990s these three words have earned wide
publicity. Let us see what these three terms mean.

Liberalisation means:
“The introduction of internal and external checks on government power and/or shifts towards
private enterprise and the market.”

In other words, liberalisation implies domination of market economy and less and less
interference of state in the economic affairs of individuals- particularly m respect of
production of commodities and the import or export Liberalisation and neo-liberalism mean
almost the same thing. In economic affairs the role of the state will be just like a night
watchman. The term liberalisation is closely connected with the idea that in all matters
individuals can be given maximum freedom and the interference of state in individuals’ own
affairs shall be reduced to the minimum level.

Privatisation means:
“The transfer of state assets from the public to the private sector, reflecting a contraction of
the state’s responsibilities.” In all types of economic affairs the state shall be allowed to play
minimum role. The economic assets and means of production shall be transferred to private
enterprises Adam Smith m his Wealth of Nations strongly argued for the private ownership of
property and means of production and he did it on the ground of better management and
efficiency. Privatisation can conveniently be termed a transfer of ownership from the
authority of the state to the management of individuals.

Why liberalisation and privatisation? Let us put it in the following words; “The emerging
system of international governance with its strong neoliberal bias reflects to some extent the
structural changes wrought by the new technological paradigm. The survival and growth of
most productive sectors in any economy depends increasingly on competitiveness with other
nations … free markets are the best way to allocate resources and direct economic activities,
and that direct government intervention should be minimised or removed … greater
liberalisation and openness are often better ways of allocating resources in many economics”.

We thus find that there are number of arguments in favour of liberalisation. The most
important ones are: It ensures the better use and application of new and improved
technologies. The scientists and technologists are supported and encouraged by big industrial
magnates to do more and more research work and these industrialists implement new
techniques and technological devices for better and improved results. In this way the progress
of industrialisation becomes quite faster.

Under the impact of liberalisation—which is another name of openness different countries

borrow or exchange new and improved technologies and they apply all these for industries
for the furtherance of industrialisation. In this way liberalisation spreads its wings even to the
remote corners of the globe.
In our definition of privatisation we have noted that it means the transfer of assets from the
authority of the state to the private person. This type of privatisation is not a local or solitary
incident. From the 1980s it has become a global phenomenon. Under the impact of openness
the nation-states have come closer to each other. The result is the economic structure of a
nation-state cannot remain aloof from the rest of the world.

Above all, international institutions such as International Monetary Fund and World Bank are
playing active role in the economic activities of various states. Let me again quote an expert:
“Commitment to structural reforms an integral part of stabilisation and adjustment
programmes of the IMF and World Bank inevitably require industrial deregulation,
privatisation, trade liberalisation and financial deregulation …………. Taken together, such
rules and conditions are bound to curb the use of industrial policy, technology policy, trade
policy and financial policy as strategic forms of intervention to faster industrialisation”. The
fact is that both liberalisation and privatisation have appeared to be inevitable.

The progress and application of these two phenomena do not depend upon the willingness or
apathy of any particular nation-state. Because of the progress of liberalisation the economics
of various nations are gradually becoming dependent upon each other. India cannot be an
exception. India’s economy and technology are parts of the world economy and technological
progress of other nations and this has hastened India to adopt privatisation and liberalisation.

The public sector enterprises in India “has acquired a prominent place and has witnessed
phenomenal growth during the last fifty years. It accounts for approximately two-fifths of the
total gross investment and contributes approximately a quarter of the GDP”. Development
Politics and Administration in India.

In 1951 there were only 5 public enterprises and total investment was around 290 million
rupees. In 2000 the number of public enterprises rose to about 250 and the total amount of
investment was several thousand crores of rupees. These figures are simply rough estimates.
But what is clear from these rough estimates is that the public enterprises in India play a
crucial role in the field of economic development in general and industrial progress in
particular.

All these public enterprises are at the central level. But there are large number of public
sector undertaking of state levels. The total investment of these enterprises is more than
60,000 crores of rupees. All these are rough estimates. The mere fact is that the role of the
public-sector enterprises in gradually increasing and in future it will rise.

In 1991 the Government of India announced a new industrial policy and this policy “lays
down measures of economic reforms and public enterprises management under which the
public sector was to play its rightful role involving socio-economic scenario of the country”
This is the importance of public enterprises in India and this importance is increasing rapidly.
The new Industrial Policy of 1991 introduced radical changes in the industrial field of India.

The major change is the industrial world, except in certain cases, has been open to free
competition. This implies that the Government of India has allowed privatisation of large
number of industries. Only the industries that fall in the category of strategic and security
importance, are kept outside the privatisation. It means that all the major and minor industries
are open to free competition.
The Government of India was forced to adopt a new industrial policy in 1991. From the
beginning of 1980s the liberalisation proceeded so rapidly that the public sector enterprises
were faced with competition. But since the public enterprises were ruled and managed by
rules and procedures made by government, the chief executive officers had hardly any
freedom to take any decision on their own volition.

This situation threw the public sector undertakings into grave crisis. The stagnation in
economy came to be the prominent feature. Moreover, the public sector units failed to
compete with other private sector units. Ultimately the public sector enterprises became
chronically sick and few of them reached the stage of collapse. Both in and outside
parliament strong criticisms were made — countrywide uproar against the management of
public enterprises was found.

The principle of privatisation is to be treated in the same bracket with liberalisation. I have
already explained it. The mature capitalist economies and the multinational corporations of
these countries started to control the economies of their own countries along with the
economies of developing and undeveloped nations of the Third World.

These nations suffer from shortage of capital and technical know-how. The states of Asia and
Africa miserably depended upon the developed nations of North. This was practically a
prelude to liberalisation. The multinational corporations and other organisations came
forward with the promises of help. But they demanded the relaxation of government rules in
respect of setting up new industries.

In other words, there was a strong demand for relaxation or abolition of state control over the
management of industries. Towards the end of 1980s the Government of India realised that if
the easy flow of capital and technology into India is not allowed India’s economy as a whole
would be crippled. This situation practically inspired Government of India to announce a new
industrial policy for the resuscitation of India’s economy and rapid industrialisation.

We thus find that both privatisation and liberalisation —the twin concepts were the products
of serious thought that Government of India acquired. We know that Chinese economy is
fully state controlled. Even that country was forced by new circumstances to adopt the policy
of liberalisation. That country also relaxed government control over industries. It was felt that
only the policy of liberalisation or adoption of liberal policies can lead a nation to the path of
progress. In the case of India the adoption of liberalisation and privatisation was the product
of real situation that engulfed India in the eighties of the last century.

Unit X

Regulatory Authorities

10.1 Need and Origin

10.2 Nature and Functions
10.3 Growth of Regulatory Authorities in India
10.4 TRAI, IRDA, UGC, CCI, SEBI, FASSAI

REGULATORY AUTHORITIES
With economic liberalization, some spheres which were
exclusively reserved for public sector were thrown open to
private sectors as well. Where PSUs did not function efficiently,
they were privatised. In some areas both public and private
units are working well. ex:-Telecom, broadcasting, electricity,
insurance. While allowing private sector the govt. responsibility
is bound to increase. A new network of regulatory agencies
do this task of controlling these units. Regulatory authority is
defined as a governmental agency that regulates businesses
in the public interest.14
Independent government commission charged by the
legislature with setting and enforcing standards for specific
industries in the private sector. The concept was invented by
the U.S. government in 1887.The theory is that a commission
of experts on the industry being regulated is better equipped
to regulate it than the legislature or executive departments.
Designed to operate with a minimum of executive or legislative
supervision, agencies have executive, legislative, and judicial
functions, and their regulations have the force of law. Important
regulatory agencies include the Food and Drug Administration,
the Federal Communications Commission, and the Securities
and Exchange Commission.
A Regulatory Authority or Regulator is a government
agency that regulates an area of human activity by codifying
and enforcing rules and regulations, supervision or oversight,
for the benefit of the public at large. It is usually a part of the
executive arm of the government or has statutory authority to
perform its functions. Regulatory authorities are commonly set
up to enforce standards and safety, to oversee use of public
goods and regulate commercial activities. Examples of
regulatory agencies are the US Food and Drug Administration,
the Telecom Regulatory Authority of India.
The Regulatory process has three basic elements
1. Ensure that the exercise of regulatory power is rule based.
2. Regulated agencies have an effective means to defend
themselves against unauthorized or arbitrary requirements
or liabilities,
3. The wider interest group have a means to have their views
considered and addressed in administrative decisions
Functioning
To ensure that it does fulfill its role, a Regulatory Body uses
mechanisms such as the following
• Transparency of information and decision making
• Procedures of consultation and participation
• Requirement that administrators give reasons explaining
their actions
• Requirement that administrators follow principles that
promote non-arbitrary and responsive decisions
• Arrangements for review of administrative decisions by
courts or other bodies
Criticism
Regulatory Agencies are sometimes accused of hindering
competitive forces and/or hindering freedom of speech.
Examples :
SEBI : Securities and Exchange Board of India
Reserve Bank of India
Company Law Board
Board of Industrial and Financial Reconstruction
Pollution Control Board
20
Competition Commission - Established under the
Competition Act 2002
Features of Regulatory Authorities :
1. These are administrative agencies, they also perform
combination of legislative , quasi judicial and
administrative functions.
2. Creations of statutes.
3. They are administrative agencies are subject to govt.
control. Reg. bodies are supposed to be more
independent of the govt.
4. They protect the interest of people by ensuring fair
competition and
5. Protecting consumers from exploitation.
6. Also performs advisory functions.
In the case of Secretary, Ministry of Information and
Broadcasting v. Cricket Association of Bengal.15 Supreme
Court stressed the need for an independent, autonomous
regulatory authority to regulate the use of airwaves and that
media should be under control of a regulatory authority, as
distinguished from governmental authority.
(a) TRAI
The Telecommunications Regulatory Authority of India or
TRAI (established 1997) is the independent regulator
established by the Government of India to regulate the
telecommunications business in India.
Notwithstanding anything contained in the Indian Telegraph
Act,1885,the functions of the Authority shall be to-
(a) make recommendations, either suo motu or on a
request from the licensor, on the following matters,
namely:
15 (1995 )2 SCC 161
21
(i) need and timing for introduction of new service
provider;
(ii) terms and conditions of license to a service
provider;
(iii) revocation of license for non-compliance for
terms and conditions of license:
(iv) measures to facilitate competition and promote
efficiency in the operation of telecommunication
services so as to facilitate growth in such
services.
(v) technological improvements in the services
provided by the service providers.
(vi) type of equipment to be used by the service
providers after inspection of equipment used in
the network.
(vii) measures for the development of
telecommunication technology and any other
matter relatable to telecommunication industry
in general;
(viii) efficient management of available spectrum;
(b) discharge the following functions, namely :
(i) ensure compliance of terms and conditions of
license;
(ii) notwithstanding anything contained in the terms
and conditions of the license granted before the
commencement of the Telecom Regulatory
Authority (Amendment) Ordinance,2000, fix the
terms and conditions of inter-connectivity
between the service providers;
(iii) ensure technical compatibility and effective interconnection
between different service providers.
22
(iv) regulate arrangement amongst service
providers of sharing their revenue derived from
providing telecommunication services;
(v) lay down the standards of quality of service to
be provided by the service providers and ensure
the quality of service and conduct the periodical
survey of such service provided by the service
providers so as to protect interest of the
consumers of telecommunication services;
(vi) lay down and ensure the time period for providing
local and long distance circuits of
telecommunication between different service
providers;
(vii) maintain register of interconnect agreements
and of all such other matters as may be provided
in the regulations;
(viii) keep register maintained under clause
(viii) open for inspection to any member of public on
payment of such fee and compliance of such
other requirement as may be provided in the
regulations;
(ix) ensure effective compliance of universal service
obligations:
(c) levy fees and other charges at such rates and in
respect of such services as may be determined by
regulations.
(d) perform such other functions including such
administrative and financial functions as may be
entrusted to it by the Central Government or as may
be necessary to carry out the provisions of this Act:
23
Provided that the recommendations of the Authority
specified in the clause (a) of this sub-section shall not be
binding upon the Central Government:
Provided further that the Central Government shall seek
the recommendations of the Authority in respect of matters
specified in sub-clauses (i) and (ii) of clause (a) of this subsection
in respect of new licence to be issued to a service
provider and the Authority shall forward its recommendations
within a period of sixty days from the date on which that
Government sought the recommendations:
Provided also that the Authority may request the Central
Government to furnish such information or documents as may
be necessary for the purpose of making recommendations
under sub-clauses (i) and (ii) of clause
(a) of this sub-section and that Government shall supply
such information within a period of seven days from receipt of
such request:
Provided also that the Central Government may issue a
licence to a service provider if no recommendations are
received from the Authority within the period of specified in
the second provision or within such period as may be mutually
agreed upon between the Central Government and the
Authority.
Provided also that if the Central Government having
considered that recommendation of the Authority comes to a
prima facie conclusion that such recommendation cannot be
accepted or needs modifications, it shall, refer the
recommendations back to the Authority for its reconsideration,
and the Authority may within fifteen days from the date of receipt
of such reference, forward to the Central Government its
recommendation after considering the reference made by the
24
Government. After receipt of further recommendation, if any,
the Central Government shall take a final decision.
(b) Insurance Regulatory and Development Authority
This authority is established with a mission to protect the
interests of the policyholders, to regulate, promote and ensure
orderly growth of the insurance industry and for matters
connected therewith or incidental thereto.
(c) Competition Commission
Competition Act, 2002-Central Govt. may by notification,
establish Competition Commission of India. It is a body
corporate having perpetual succession and common seal.
Function is to prevent practices having an adverse effect
o competition, to promote and sustain competition in market ,
to ensure freedom of trade.
(d) Central Electricity Regulatory Commission-
Set up under the Electricity Regulatory Commission Act
1998.This act was replaced by Electricity Act 2003.-This law
consolidates law relating to generation, transmission,
distribution, trading and use of electricity.
Works-Rationalisation of tariff, ensuring transparent policies
regarding subsidies, supply of electricity to all areas, adjudicate
upon disputes between licencees and generating companies.,
facilitate intra State transmissions. etc.