Judicial Control and Exercise of Discretion

The transformation of the philosophy of state in the twentieth century from lassie faire to welfare has augmented the state’s responsibility towards its subjects. There is no modern state in this epoch which can execute such innumerable functions devoid of any discretionary power of its own. India being a welfare democratic state is no exception to this procedure and therefore, administrators are bestowed with greater power and authority to meet the goals of a welfare state. Justice Bhagwati in R. D. Shetty v. International Airport Authority of India [1] , in the obiter dicta has said that, “exercise of discretion is an inseparable part of sound administration and, therefore, the State which is itself a creation of Constitution, cannot shed its limitation at any sphere of state activity.”

Art of governance is complex and with unlimited usage of such power would definitely leave a vacuum where arbitrariness can germinate. Therefore a yardstick of its use is necessary. ‘Discretion suggests choosing one option from several options without any pre-determined criterion. As soon as the word ‘discretion’ is added with the word ‘administrative’, its use becomes qualified. Its exercise has to be with reference to the rule of reason and justice and not according to one’s personal whims.’ [2] Any use which has an ambition of personal gain or personal satisfaction is prohibited by the rule of law.

The grant of this discretion by the country’s legislature is well intended and bona fide but still knowing the darker side of this power, the Judiciary of this country has been trying to circumvent its misuse and abuse. The judiciary, being the watch dog of our rights, has its control over this administrative power in two different stages. Firstly, when it is granted to the administrative authority by our legislature and secondly, when it is at the stage of being used by the administrative authorities. However, for the purpose of this project only the second point would be discussed in details.

Definition

The definition of Administrative discretion is offered by many but there only few which are worth mentioning. Prof. Freund [3] said that:

“When we speak of administrative discretion, we mean that a determination must 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.”

In black law’s dictionary [4] , administrative discretion would be a public official’s or agency’s power to exercise judgment in the discharge of its duties.

According to another thinker, Coke, discretion would be “…a science or understanding to discern between falsity and truth, between right and wrong, between shadows and substance, between equity and colorable glosses and pretences, and not to do according to their will and private affection.” [5]

In Oxford Dictionary of law, administrative powers have been defined as “the discretionary powers of an executive nature that are conferred by the legislature on government, ministers, public and local authorities and other bodies and persons for the purpose of giving detailed effect to the policy intended by the legislature itself.” [6]

Discretionary powers bestowed on the administrative authorities are of a vast range. Their power serve the purpose of simple ministerial tasks like maintenance of birth and death register as well as those which seriously affect the rights of an individual, e.g. acquisition of property, regulation of trade, industry or business, inquiry, seizer, confiscation and destruction of property, detention of a person on subjective satisfaction of an executive authority and many more. The list of their functions is exhaustive in nature.

Basically, administrative discretion is provided to the executive using which they drive the process of governance smoothly in the country. In short, the purpose of the discretion is to serve the country’s citizens’ in the best possible way.

Why is judicial control necessary?

Judicial review is the soul of our constitution. It is the exercise of the court’s inherent power to resolve whether an action is lawful or not. ‘It holds the balance of power between individuals and the government. It legitimizes the application of administrative sanctions.’ [7]

In India, judicial review has a firm base. The framers of our constitution had not only believed in limited government was necessary for democracy but also enshrined the philosophy in the constitution. It is a modus operandi for public accountability of the administrative process. In this process, it principally maneuvers as a check upon the administrative branch of the government and the agencies operating, thereunder. ‘According to Schwartz, the basic remedy against illegal administrative actions is the judicial review. A person aggrieved by an agency decision or other act may challenge its illegality in the courts.’ [8] Without, judicial review, administrative action and discretion would be limited only by agency, self-discipline, executive direction, or legislative and public pressure. Thus this control acts as a limitation on nasty abuses of power.

Courts in India are the guardians of our constitution. From time immemorial, they have believed that executive and legislative powers which are immune from judicial scrutiny are in a way repudiation of rule of law. Therefore for the purpose of doing justice and to protect the Rule of Law [9] , they through their various pronouncements, have build up an assortment of formulations to control the exercise of administrative discretion. After clubbing these formulations, we can summarize the judicial control at the stage of exercise of discretion by the administrative authorities into two things:

That the authority is deemed not to have exercised its discretion at all

That the authority has not exercised its discretion properly

Failure to exercise discretion

‘The courts exercise judicial control if the administrative authority has either resigned from using its power or has put restrictions on its implementations of the discretion or the jurisdictional facts are either absent or have been erroneously concluded.’ [10] In Indian Railway Construction Co. Ltd. v. Ajay Kumar [11] , the law has been made crystal clear. In this case the Supreme Court held that in general, discretion must be exercised only be the authority to which it is committed. The authority must genuinely address itself to the matter before it; it must not act under the dictates of another body or disable itself from exercising discretion in each individual case. In the purported exercise of discretion, it must not do what it has been forbidden to do, nor must it do what it has not been authorized to do. Judiciary can compel the administrative authority to exercise the discretion but can not make them exercise it in a particular way. There would be very few situations which would be discussed where there is an occurrence of failure to exercise discretion. The following chapter has been divided into two sections:

• Surrender, abdication or dictation of discretion- In Purtabpore Co. Ltd. V. Cane Commr. Of Bihar [12] , the Cane Commissioner had the discretion to hold back sugarcane quarters for the individual sugar factories. But instead of using the discretion by own will, he acted upon the dictates of the Chief Minister. The commissioner excluded 99 villages from the area held in reserve by him in favour of the appellant-company previously. The two judge bench of the Supreme Court quashed the exercise of discretion by the Cane Commissioner on the ground that he abdicated his power by exercising it at the dictation of C.M. Therefore, it was deemed that the authority had not exercised its discretion at all. Thus, such so-called exercise of discretion amounted to a failure to exercise discretion by the authority.

• Fettering of discretion- In Shri Rama Sugar Industries Ltd. v. State of Andhra Pradesh [13] , Sec-21 of the Andhra Pradesh Sugarcane (Regulation, Supply and Purchase) Act, 1961 gave discretion to the administrative authority to excuse any new factory from payment of tax. The government framed a new policy granting exemption only to those factories in the co-operative sector. The Supreme Court, held that the adoption of this policy has fettered the exercise of discretion and said that an authority bestowed with such statutory discretion may justifiably implement general rules or principles to channel itself in the exercise of its discretion provided such rules are not arbitrary and not opposed to the objectives of the Act. The court in addition said that by adopting such rules, the agency must not stop itself from exercising authentic discretion in individual cases.

Authority has exercised discretion improperly

Indian courts have shown that they are pretty eager to examine the factual basis on which the administrative authorities have exercised their discretion. Furthermore, whether the discretion has been exercised in an unreasonable manner or absolutely in defiance of logic and morality, the court to use the Wednesbury Test [14] of reasonableness and see whether the discretion has been outrageously used, so much that it paved way for arbitrariness. The test suggests that the discretion can be nullified if there is a manifested error in the exercise of such power or the exercise of such power is manifestly arbitrary or mala fide or unreasonable. The decision could be from numerous choices open to the authority, to exercise its choice; the court would not surrogate its view. The court would infact strive to ensure its mala fide use.

Unreasonable exercise of discretion or violation of Wednesbury Principle: In SR Venkataraman v. Union of India [15] , the appellant, a Central Government Officer was retired prematurely from his service in ‘public interest’ on attaining 50 years of age. According to her there was non-application of mind on the part of the government. Her service record was made bad by giving adverse remarks by the chairman and that in the facts and circumstances of the case the discretion vested under Rule 56(j) (i) was not exercised for furtherance of pubic interest but on extraneous circumstances. The government conceded that there was nothing on record to justify the order. The Supreme Court said that an administrative order which is based on reasons of fact which do not exist must therefore be held to be infected with an abuse of power.

Malafide Exercise of Power: In G. Sadanandan v. State of Kerala [16] , the Supreme Court held that a mala fide exercise of discretion is nothing but abuse of power. In this case, the petitioner challenged his detention order by the government on the ground of mala fide exercise of discretion. The facts presented in court showed that a fake report against the petitioner who was a wholesaler dealer in kerosene was made by the Deputy Superintendent of Police (Civil Supplies Cell). He was actually a relative of his competitor therefore in order to benefit his relatives in the same trade; a plot was hatched to eliminate the petitioner from the trade. Moreover no counter-affidavit from the side of the government was filed thus, the court quashed the order declaring improper use of discretion.

Irrelevant Considerations: In Barium Chemicals v. Company Law Board [17] , the court was of opinion that if it is claimed that the conditions do not exist or that they are such that is not viable for anyone to form an opinion therefrom then such opinion is challengeable on the ground of non-application of mind or perversity or on the ground that it was formed on collateral grounds and was beyond the scope of the statute. In this case, a board was instituted under sec-237 of the Companies Act, 1956 which is authorized to investigate only if in its opinion the company is trying to defraud the creditors or members, etc. but here it conducted the enquiry on the basis of faulty management of the company which resulted in heavy downfall of the share prices. Therefore, the court by quashing the order, said that executive by merely declaring an opinion does not mean that the order would not be scrutinized.

Relevant Factors disregarded: In Rampur Distillery and Chemical Co. Ltd. v. Company Law Board [18] , the Supreme Court affirming the decision of the lower Court held that since the board has based its decision solely on the past conduct without considering subsequent conduct and activities of the person which are relevant factors, its decision was wrong. Sometimes an order may be based partly on relevant and partly on irrelevant considerations. In such situations the Courts would try and find out the true purpose for which the power was exercised. After due consideration, the Court comes to the conclusion that the purpose of the exercise was improper, it would be irrelevant that incidentally a genuine purpose is also served. This would depend on the facts and circumstances of each case. Therefore, ‘where a matter is to be decided by the authority solely on the basis of its subjective satisfaction, it must be properly based on relevant considerations only and not a mix of both as it would be very difficult for the court to decide as to how much the irrelevant consideration played a role in deciding ona particular course of action.’ [19]

Mixed motives /colourable exercise of discretion: In Jiwani Kunar v. First Land Acquisition Collector [20] , where the government could acquire property for a public purpose only temporarily, and the land was acquired permanently, the court held it to be a colourable exercise of power.

Subjective Satisfaction: ‘The court said that administrative authority’s decision could be one of many choices but it is for the authority to make choice. Court cannot substitute its choice; no matter a little play in the joints is certainly possible while dealing with the subjective satisfaction.’ [21] In Shalini Soni v. Union of India [22] the Supreme Court observed that it is an unwritten rule of the law, constitutional and administrative, that whenever a decision-making function is entrusted to the subjective satisfaction of a statutory functionary, there is an implicit obligation to apply his mind to pertinent and proximate matters only, eschewing the irrelevant and the remote.”

Arbitrary exercise of discretion- In R.D. Shetty v. International Airport Authority of India [23] , the issue was regarding awarding of a contract for running a second-class restaurant and two snack bars by the International Airport Authority, which is a statutory corporation. The right of selection and rejection was with the Airport Director who accepted the tender from a non-hotelier. The petitioner in this case was neither an hotelier nor tenderer. His claim was that both the tendered were in the same position as if a necessary condition i.e., only registered hoteliers can send tender, can be forgone then why not petitioner’s. The Supreme Court upheld the Locus Standi and Jus. Bhagwati said that every action of the Executive Government must be informed with reason and should be free from arbitrariness. That is the very essence of the rule of law and its bare minimal requirement.

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

Conclusion

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

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

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

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

” it seems as if the Police Department which is under the control of the Home Department is not even aware of the existence of Article 21 of the Constitution of India…..This Article specifically guarantees that ‘no person shall be deprived of his life or personal liberty except according to procedure established by law.’ [24] Oblivious of the aforesaid guarantee, the police have resorted to gun firing on a large crowd protesting against the proposal to acquire their land.” There was a total absence of rule of law in west Bengal during this period.

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