SOME RECENT DEVELOPMENTS IN ADMINISTRATIVE LAW IN INDIA

I
A POSITIVE TREND discernible after 1965 in t h e j u d g m e n t s of the
Supreme Court is the control of discretionary powers of t h e executive
through insistence on procedural safeguards. 1 I n a society governed
by the "rule of l a w " it is essential that t h e individual's rights should
not be dependent on t h e whims a n d capriciousness of a n official, a
danger likely to arise if t h e executive enjoys untrammelled discretion
or power. However, we are also living in the age of administrative
states — the states which possess vast administrative powers for im-
proving the welfare of their people. T h e bane of t h e welfare state
has been t h e devolution of discretionary powers almost unlimited in
amount on the officials. T h e r e is no sign of abatement of t h e
tremendous discretionary powers of t h e administration. O n e of t h e
safeguards available to the individual against t h e vast powers of t h e
state is in procedural safeguards, and, it has been very aptly said that
the history of human liberty has been largely the history of procedural
safeguards. As t h e recent cases show, t h e Supreme Court has been
playing a vigorous a n d a commendable role in evolving these safe-
guards. T h e three cases, P. L. Lakhanpal v. Union of India,2 Union of
India v. Indo-Afghan Agencies Ltd.? a n d State of Assam v. Bharat
Kala Bhandar,* constitute the high water-mark of this development.
T h e three cases pertain to the area of administrative law, i.e., in t h e
area of conflict between t h e state and t h e individual. These decisions
are important milestones towards t h e goal of attaining safeguards to
the individual against abuse of power by t h e scate. These cases show
that our Supreme Court is quite active in responding to the demand
made upon it. It is quite vigilant in protecting individual liberty
without, at the same time, unduly hampering the task of the govern-
ment in establishing a welfare state.

T h e task of t h e judiciary in an emerging a n d fast-changing

society is paradoxically both difficult and an easy one. Since the
society is on the move, the judiciary does not have t h e benefit of

1. This is clearly demonstrated by the number of cases in which the Supreme

Court held the administrative function to be quasi-judicial: Shri Bhagwan v. Ram
Chand, A.I.R. 1965 S.C. 1767; Associated Cement Companies v. P. N. Sharma, A.I.R. 1965
S.C. 1595; State of Orissa v. Dr. Binapani, A.I.R. 1967 S.C. 1269; Dr. Bool Chand v.
Chancellery Kurukshetra University, decided on Sept. 4, 1967; Calcutta Dock Labour Board
v.Jaffar Imam, A.I.R. 1966 S.C. 282; Dwarka Nath v. Income-tax Officer, A.I.R. 1966
S.C. 81 ; P. L. Lakhanpal v. Union of India, A.I.R. 1967 S.C. 1507.
2. A.I.R. 1967 S.C. 1507.
3. A.I.R. 1965 S.C. 718.
4. A.I.R. 1967 S.C. 17C8.

www.ili.ac.in © The Indian Law Institute

532 JOURNAL OF THE INDIAN LAW INSTITUTE [VOL. 10 : 531

accumulated experience on various legal issues which might be avail-

able to it in a society not in such a fast changing process, this making
its task difficult. Because of infinite new situations demanding solution
in a society in flux, often the trial and error method may have to be
adopted to deal with cases. O n the other hand, the judiciary has
the advantage of playing a more constructive role, as very often it is
not cribbed or confined by pre-established notions or case law. The
trend of recent cases shows that the Court is taking good advantage of
this favourable position.

II
T o mention the Lakhanpal case, the first case of the series, the
Defence of India Rules, 1962, confer power on the government to
detain a person if it was satisfied that his activities were prejudicial to
the defence of India, public safety and maintenance of public order.
It was earlier held by the Supreme Court 5 that since the Defence of
India Act was an emergency measure, it was a matter of subjective
satisfaction for the government to make an order of detention, and the
authority was not required to act judicially in arriving at the decision
of detention. T h e relevant rules of the Defence of India Rules also
require that an order of detention once m a d e has to be reviewed every
six months. T h e function of review was also held to be administra-
tive in Sadhu Singh v. Delhi Administration^ on the ground that if the
initial order was executive (or administrative) a review of that order
cannot but be regarded as an executive order. However, in the
Lakhanpal case, in an opinion delivered by M r . Justice Shelat, the
Supreme Court overruled this position and held that the review func-
tion of detaining authority was quasi-judicial even though the initial
decision may be administrative. It was pointed out by the Court
t h a t there was a difference in the government's power to detain a
person initially and in its power in continuing his detention beyond
a period of six months. Whereas the former depended upon the
subjective satisfaction of the detaining authority, the latter had to be
determined objectively, i.e., upon the relevant material collected and
by weighing the evidence brought before it. T h e Court also stated
that it would not be possible for the authority to do so
unless the person concerned is given an opportunity to correct or contradict
such evidence either by explanation or through other materials which he can
place before the authority. 7

T h e case is noted here for its sheer importance without much com-
ments. T h e case belies the general belief that in an emergency the
judiciary should defer to the omnipotent powers of the executive and
should not read by implication procedural safeguards to the individual

5. Sadhu Singh v. Delhi Administration, A.I.R. 1966 S.C. 91.

6. Ibid.
7. Supra note 2 at 1511.

www.ili.ac.in © The Indian Law Institute

1968] SOME RECENT DEVELOPMENTS IN ADMINISTRATIVE LAW 533

in the statute, since the executive has to take quick decisions. By

conceding initial detention to be administrative and the review func-
tion as cjuasi-judicial, the court reconciles the need for drastic powers
in the hands of the executive in an emergency with the need for some
procedural safeguards to the individual against misuse of power by it.
Ill
T h e second case, Union of India v. Indo-Afghan Agencies Limited, is
important because the Supreme Court for the first time applied, what
in substance is the doctrine of estoppel against the government 8 on the
basis of equity. It constitutes a definite departure from the traditional
notions of estoppel. T h e general rule is t h a t no estoppel is available
against a statute, the underlying theory being that it is the legislature
which prescribes the law and not the official who has no right to
modify the provisions of a statute. If the government is m a d e bound
by a representation of an official which is contrary to law it would mean
that the executive can change the provisions of the Act which is the
prerogative of the legislature in a democratic society. T h e doctrine
of estoppel then could be used to give d efacto validity to ultra vires
administrative acts. 9 Further if estoppel is available against the
government in such cases there is a danger t h a t fraudulent or in-
advertent actions of its officials may bind the government. Similarly
where a statute confers discretion on a public authority it is expected
to apply it as and when actual cases come before it in the normal
course and that it is not expected to fetter the exercise of its discretion
by contract, representation to an individual, or prior announcement
of rules by policy. In the Indo-Afghan Agencies case, however, the
Supreme Court, in an opinion delivered by M r . Justice Shah, contrary to
what its counterpart in England (The House of Lords) has done so far,
applied the doctrine of estoppel against the administration. In this
case was involved the import policy of the government which contained
an export promotion scheme. U n d e r this scheme an applicant was
to be given an import licence for exports m a d e by him in accordance
with the scheme. Assuming that this scheme did not have a statutory
force 10 and as such the government was not bound by the statements
contained therein, the Court still directed the licensing authority to

8. With a rare exception the opinion of the High Courts has consistently been
that no estoppel was available against the statute : Hindustan Motors Ltd. v. Union of
India, A.I.R. 1954 Cal. 151; Lakshmi Narayanv. State of Rajasthan, A.I.R. 1966 Raj. 118,
J. J. S. Rodrigues v. Umon of India. A.I.R. 1967 Goa 169. Nawranglal Agarwala v.
State of Orissa, (1965) 16 S.T.C. 271; Jetmull Bhojraj v. State, A.I.R. 1967 Pat. 287.
Also see Patanjali Sastri, J.'s opinion in city of Bombay v. Mun. Corp,. A.I.R. 1951 S.C.
469 therein he observed that "equity cannot be enforded so as to vialate an express
statutory provision." But see Municipal Corporation of City of Bombay v. The S.S. for
India in Council, 29 Bom. 580 (1903).
9. See Schwartz, An Introduction to American Administrative Law 245 (1965).
10. See S. N. Jain } "Administrative Discretion in the Issue of Import Licences,"
10 J.I.LJ. 121 (1968), on the question whether it has statutory force or not.

www.ili.ac.in © The Indian Law Institute

534 JOURNAL OF THE INDIAN LAW INSTITUTE [VOL. 10 : 531

grant an import licence on grounds of equity. T h e principle of

equity was invoked by the Court because the applicant acting on the
representation of the department, h a d exported the goods in the hope
of getting the import licence and thus had earned foreign exchange for
the country. T h e case thus establishes that in some suitable and
exceptional cases the court would apply the doctrine on the basis of
equity against government though, it is difficult to state with precision
the situations in which this would be done. 10 a
In this connection one may recall a few American cases. In the
United States also the general rule is that no estoppel is available
against the statute. In one Supreme Court case, Automobile Club of
Michigan v. Commissioner,11 however, there is an indication that if dis-
regard of official advice (in this case, ignoring a ruling issued by the
Commissioner of Internal Revenue to a tax-payer) constitutes abuse
of discretion, the court might apply the doctrine of estoppel against
the administration, though the facts in this case did not warrant its
application. In a few cases the lower federal courts have actually
applied the doctrine by invoking such principles as " t h e disregard of
official representation by the administration caused a profound and
unconscionable injury," 1 3 or " t h e official exceeded bounds of permis-
sible discretion in subsequently ignoring his advice." 1 3
T h e one unhappy feature of the Indo-Afghan Agencies case is that
the Court cited an English case of Robertson v. Minister of Pensions14
decided by the Kings Bench Division in support of its conclusion which
may, however, be said to be overruled by the House of Lords in its
decision in Howell v. Falmouth Boat Construction Company Ltd.1B It was
observed by Lord Norman therein :
10a. It may be mentioned that section 115 of the Indian Evidence Act, 1872,
embodies the doctrine of estoppel which is somewhat different from the doctrine of
estoppel considered here in regard to its applicability against the government.
Section 115 in essence provides that if a person makes a representation to another person
causing him to believe a thing to be true and to act upon such belief, he cannot later on
in any suit or proceeding be allowed to deny the truth of that thing. The doctrine
embodies in this section is a rule of evidence, whereas the other doctrine is a rule of
equity. (Municipal Corporation of City of Bombay v. Secretary of State, 29 Bom. 58 (1905))
The latter is much wider than the former. Even though a case may not come within
section 115, it may still fall under the other doctrine (The Indo-Afghan Agencies case).
Whereas the section 115 doctrine operates in relation to some acts alleged to be at the
time actually in existence, the other doctrine also covers promises as to future, or
representations containing statements as to the future course of conduct to be followed
by the maker (Jethabhai v. Nathabhai, 28 Bom. 399 (1904); Parshoitam v. S. S., (1937) 39
Bom. L.R. 1257).
11. 353 U.S. 183(1960).
12. Schuster v. Commissioner, 312 F. 2nd 311 (1962).
13. Lesalvy Foundation v. Commissioner, 238 F. 2nd 589 (1966).
14. [1949] 1 K.B. 227.
15. [1951] A.C. 837. Also, Southend-on-Sea Corporation v. Hodyson Wickford Ltd.,
[1962] 1 Q..B. 416. See de Smith, Judicial Review of Administrative Action 86 (1968);
Schwartz, An Introduction to American Administrative Law 243 (1962).

www.ili.ac.in © The Indian Law Institute

1968] SOME RECENT DEVELOPMENTS IN ADMINISTRATIVE LAW 535

[I]t is certain that neither a Minister nor a subordinate officer of the Crown
can by any conduct or representation bar the crown from enforcing a statu-
tory provision or entitle the subject to maintain that there has been no breach
of it. 16

Further the Privy Council decision in Ahmad Tar Khan v. Secretary of

State11 also relied by the Court, was also not relevant. T h a t case did
not involve any issue of estoppel against the statute (at least no point
as to involvement of any statute is m a d e in the judgment) but involved
a dispute between the individual and the government about the grant
of land to the appellants in 1861, and the interpretation of sanad. In
the Indo-Afghan Agencies case, on the other hand, there was the question
of fettering the exercise of its statutory discretion, which under the
statute the licensing authority was expected to apply from case to case
as it came before it, through estoppel. 1 ? a

Leaving aside the formalistic grounds for not applying the doctrine
of estoppel against the government {e.g. the arguments of separation
of powers that it is the legislature which prescribes the law and not
the executive), the decision of the Supreme Court in the Indo-Afghan
Agencies case can be justified on the broader grounds of policy. As
stated earlier one major policy consideration against applying the
estoppel against government is the danger of its agents binding it
through fraudulent or inadvertent acts. T h e r e is no warrant for this
fear in the situation presented in this case. T h e export promotion
scheme is issued by the highest officials of the d e p a r t m e n t in question,
namely, the Chief Controller of Imports. It is issued after due
deliberations, after taking into account the advice of various agencies
and the overall economic conditions prevailing in the country. It is
published for the general benefit of all concerned. However, if it is
assumed to be administrative in character the only other ground of
policy for its non-enforcement appears to be that the government has
deliberately chosen to keep its policy flexible ; and to ignore it if the
changing economic conditions require such a course. This may provide
a general basis for not enforcing estoppel against government in such
cases. But where, as in the instant case, the individual suffered a
positive injury by acting in reliance of the governmental representation
there does not seem to be any justification in not applying estoppel
against government on ground of equity. 1 8

16. [1951] A.C. 849.

17. L.R. 28 I.A. 211.
17a. See Southend-on-Sea Corporation case, supra note 15 at 424, wherein it was
staled that estoppel cannot be raised to prevent or hinder the exercise of the discretion.
18. On the question of applicability of estoppel against the government consult,
Newman, "Should Official Advice be Reliable? : Proposals as to Estoppel and Related
Doctrines in Administrative Law," 53 Colum. L. Rev. 374 (1953); Lynn and Gerson,
"Quasi-estoppel and Abuse of Discretion as Applied Against the United States Federal
Tax Controversies," 19 Tax. L.R. 487 (1963-64),

www.ili.ac.in © The Indian Law Institute

536 JOURNAL OF THE INDIAN LAW INSTITUTE [VOL. 10 ; 531

IV
T h e third case, State of Assam v. Bharat Kala Bhandar, may now
be considered. Till recently it was believed that where a statute is
silent, the only way to infer hearing was by holding the administrative
function quasi-judicial. In this case, however, the Supreme Court, in
an opinion delivered by M r . Chief Justice Wanchoo, insisted on some
hearing without holding the function to be quasi-judicial. T h e facts
were: a notification issued by the executive under the Defence of India
Rules, 1962, notified certain employments essential "for securing public
safety and for maintaining supplies and services necessary to the life
of community." Another notification ordered payment of specific cost
of living allowance to all workers drawing pay u p to Rs. 400 and also
to workers employed on daily wages. About the former notification no
objection as to hearing before its issue was made. However, about the
latter notification the Court held t h a t it was necessary to consult the
interest before its issue as its effect was to disturb settled industrial
relations based on contracts or industrial awards. It is obvious from
the judgment that on account of the emergency the Court refrained
from holding the administrative action as quasi-judicial.
T h e pronouncement is a departure from the approach hitherto
adopted that hearing can be inferred only if an administrative function
is quasi-judiciaL T h e case is important because of the difficulties in
classifying function first as quasi-judicial and then inferring hearing.
T h e major difficulty of classification sterns from the fact that one label
"judicial" with its different ingredients and consequences is attempted
to be attached to a variety of questions of different nature. W h a t a
disciplinary authority should do in taking action against an employee
for misconduct is different from what government should do in approv-
ing the scheme for nationHzation where treatment to be meted out to
an individual is one of the many matters to be considered. A few
important consequences of characterizing a function as quasi-judicial are :
(a) fair hearing, including oral arguments and right to cross-examination
in some cases (b) lack of bias on the part of the deciding authority; and
(c) judicial review of administrative action on grounds of no legal
evidence to support the findings and error of law apparent on face of
the record. T h e disciplinary proceedings against civil servants satisfy
the basic attributes of quasi-judicial fuction, i.e., notice, hearing,
including oral hearing,, and finally reviewability of administrative
decision on complete lack of evidence. But this does not happen in a
situation of nationalization like the one presented in the Gullapalli v.
A. P. State Road Transport Corporation.19 Situations where administrative
action is to be taken on the broad ground of public policy and the
authority enjoys wide discretion but some procedural safeguards may
be considered necessary in the interest of the individual present a

19. A.I.R. 1959 S.C. 308.

www.ili.ac.in © The Indian Law Institute

1968] SOME RECENT DEVELOPMENTS IN ADMINISTRATIVE LAW 537

dilemma for the courts for the only possible way to infer some hearing
is through holding a function quasi-judicial. For instance in England
it is not beyond doubt whether the proceedings in making clearance or
compulsory purchase orders under the Housing Acts, which involve a
hearing by a person appointed by the minister which is also t h e
confirming authority, are administrative or quasi-judicial. It has been
stated that the function of the minister in such proceedings is
administrative-
subject only to the qualification that, at a perticular stage and for a particular
and limited purpose there is imposed on his administrative character a
character which is usually described as quasi-judicial. 20
T h e problem of classification of these proceedings was also considered
by ths Franks Committee. 2 1 It was of the view that the
general conclusion is that these procedures cannot be classified as purely
administrative or purely judicial. They are not purely administrative because
of the provision for a special procedure preliminary to the decision—a feature
not to be found in the ordinary course of administration—because this pro-
cedure. . . .involves testing of an issue, often partly in public. They are not
on the other hand purely judicial, because the final decision cannot be reached
by the application of rules and must allow the exercise of wide discretion in
the balancing of public and private interest. Neither view of its extreme is
tenable, nor should either be emphasised at the expense of the other. 22

The Committee, however, emphasized that the proceedings should be

reasonable both from the point of view of the individual and the
administration. T h e judicial dilemma in f n.dia is very much reflected
by the decision for the Supreme Court in Jayantilal Amritlal v. F. J\f.
Rana.%% This case arose under the Land Acquisition Act, 1894,
Broadly speaking the statute prescribes the following procedure for
acquiring land. T h e collector is required to give a hearing to the
person whose land was being acquired; he is required to send his
recommendations to the government and the final decision is taken by
the government. T h e function of the collector in giving a hearing to
the objector whose land was being acquired was held to be adminis-
trative.
In view of the unsatisfactory basis for classifying administrative
powers as quasi-judicial it may be suggested that in future cases t h e
judiciary may insist on some kind of hearing appropriate to the
circumstances without attempting to classify the functions as quasi-
judicial as the Supreme Court did in the Bharat Kala Bhandar case. 2 2
T h e lead given by this case is in the right direction and it is hoped

20. Lord Green's view in B. Johnson &> Co. (Builders) Ltd. v. Minister of Health,
[1947] 2 All E.R. 395, 399, his opinion in Robinson v. Minister of Town and Country
Planning, [1947] K.B. 702, 713. See also Griffith and Street, Principles of Administrative
Law 171-76 (1963); de Smith, Judicial Review of Administrative Action 39 (1959).
21. The Committee on Administrative Tribunals and Enquiries, 1955.
22. Report of the Committee on Administrative Tribunals and Enquiries 60 (1957).

www.ili.ac.in © The Indian Law Institute

538 JOURNAL OF THE INDIAN LAW INSTITUTE [VOL. 10 : 531

that it does not remain merely a flash in the pan but sets up a trend
for the future cases.
In England the Baldwin^ case is regarded as laying down the
proposition that an authority may be required to observe the principles
of natural justice even though it is not exercising judicial functions.
It has been commented on the case :
From now on label-consciousness and word-worship may be less conspicuous
feature of administrative law in the courts.... 26
This is a happy trend but there is much uncertainty as to the judicial
attitude where the situation does not warrant the application of the
audi alterm partem rule but still there is necessary to impose some kind
of hearing to guard against administrative arbitrariness. In this
connection another English case in re H. K. {an Infant)*1 is worth noting
where was observed that even though an administrative authority is
not acting judicially, it ought to act fairly (i.e. observe fair procedure).
S. N. Jain.

23. A.I.R. 1964 S.C. 648. Also Abdul Hussain Tayabali v. State of Gujarat, decided
on 20, Sept. 1967.
24. See Nathanson, "The Right to Fair Hearing in Indian, English and American
Administrative Law," 1 J.I.L.I. 492, 501, 519-21 (1958-59). It is worth noting that in
an earlier case, Radeshyam v. State of M.P., A.I.R. 1959 S.C. 107, the Supreme Court
stated that
to say that an action...is administrative is not to say that the Government has
not to observe the ordinary rules of fair play.
25. [1963] 2 W.L.R. 935.
26. A comment on the case by de Smith in 1963 Mod. L. Rev. 343, 545.
27. [1967] 2 W.L.R. 962.
*LL,M.J.S.D. (Northwestern), Research Professor, Acting Director, Indian Law
Institute.

www.ili.ac.in © The Indian Law Institute