Chapter - II

NECESSITY OF ADMINISTRATIVE LAW IN MODERN STATE

As we know that properly exercised, the 3. Limitations of powers of such

new powers of the executive leads to the authorities,
Welfare State; but abuse they lead to the 4. Procedure to be followed while exercise
Totalitarian State. And it is one of the the power by them,
important object of the study of administrative 5. Provide the remedies against the
law is to unravel the way in which these administrative authorities.
administrative authorities could be kept within Thus the administrative law became
their limits so that the discretionary powers tool to regulate functions of state it makes
may not be turned into arbitrary powers. policies & provides the leadership to
Today state is not merely Police or Laissez legislation as well as executives, it therefore
Faire State, but as a progressive democratic apart from administrative power the
state it seeks to ensure social security & social administrative authority having legislative or
welfare for the common man and do various discretionary or adjudicative powers. Because
functions e.g. – Excelware case3, Kameshwar of all the above the administrative law became
sing case4. an independent branch of study under the
In democratic State Govt. has to play realm of public law.
following role
(1) Protector – Law & order, Life, Liberty *Factors which contributes the growth of
and Property, administrative law
(2) Provider – the Livelihood to the citizens, The following factors are responsible
(3) Eco-controller – removal of the for the growth of administrative law:
inequalities, (a) The concept of a welfare state
(4) Interplunar – enter into contracts, As the States changed their nature
(5) Arbitral – settle the disputes. from laissez-faire to that of a welfare state,
All these developments have widen the government activities increased and thus the
scope & ambit of the need to regulate the same. There is a radical
Administrative law as these help to change in the philosophy of the role played by
determine the following – the state. The negative policy of maintaining
1. Who are the administrative authorities, law and order and social welfare is changing.
2. What sort of powers are exercised by The state has not confined its scope to the
such authorities, traditional and minimum functions of defense
and administration of justice, but has adopted
3
. 1978 SCC (4) 224 the positive policy and as a welfare state has
4
. AIR 1962 SC 1166

10
undertaken to perform varied functions. Thus, (d) The scope for experiments
this branch of law developed. There is scope for experiments in
(b) The inefficiency of Judiciary administrative process. Here unlike, in
The judicial procedure of adjudicating legislation, it is not necessary to continue a
matters is very slow, costly complex and rule until commencement of the next session
formal. Furthermore, there are so many cases of the legislature. Here a rule can be made ,
already lined up that speedy disposal of suites tired for some time and if it is defective, can
is not possible. It was already overburdened be altered or modified within a short period.
and it was not possible to expect speedy Thus, legislation is rigid in character , while
disposal of even very important matters. The the administrative process is flexible.
important problems could not be solved by (e) Scope for the experiment
mere literally interpreting the provisions of As administrative law is not a codified
some statutes, but required consideration of law there is a scope of modifying it as per the
various other factors and it could not be done requirement of the State machinery. Hence, it
by the ordinary courts of law. Therefore, is more flexible. The rigid legislating
industrial tribunals and labour courts. Were procedures need not be followed again and
established, which possessed the techniques again because the administrative authorities
and expertise to handle these complex can avoid technicalities. Administrative law
problems. represents functional rather than a theoretical
(c) The inadequacy of legislature and legislative approach. The traditional
The legislature has no time to legislate judiciary is conservative, rigid and technical. It
upon the day-to-day ever-changing needs of is impossible for courts to decide cases
the society. Even if it does, the lengthy and without formality and technicality.
time-taking legislating procedure would render Administrative tribunals are not bound by
the rule so legislated of no use as the needs rules of evidence and procedure and they can
would have changed by the time the rule is take a practical view of the matter to decide
implemented. Besides this it was impossible complex problems.
for it to lay down detailed rules and (f) To take preventive measures
procedures, and even when detailed provisions Administrative authorities can take
were laid down by the legislature, they have preventive measures. Unlike regular courts of
found to be defective and inadequate. law, they do not have to wait for parties to
Therefore, it was necessary to delegate some come before them with disputes. In many
powers to the administrative authorities. cases, these preventive actions may prove to
Hence, the executive is given the be more effective and useful than punishing a
power to legislate and use its discretionary person after he has committed a breach of law.
powers. Consequently, when powers are given As Freeman says, “Inspection and grading of
there arises a need to regulate the same. meat answers the consumers need more

11
adequately than does a right to sue the seller
after the consumer injured”.
Thus the Administrative authorities
can take effective steps for the enforcement of
the aforesaid preventive measures e.g.
suspension, revocation and cancellation of
license, destruction of contaminated articles
etc., which are not generally available through
regular courts of law.
The Role of administrative law is to
limit the powers of the government agencies
and keep a check in on the administrative
authorities. it is not always possible to rely
upon some general statutes for rising disputes
between the individuals and the public
authorities thus there should be a proper law to
govern such disputes, Administrative law act
as the proper law which governs the
administrative actions.
Besides this, the Administrative law is
generally a unwritten and uncodified law.
Administrative law is a judge-made law•. It is
recommended to bring an codified form of
administrative law which ensures an complete
growth of Administrative law and also makes
the job of administrative tribunals in deciding
cases. An written form of administrative law
gives an well-versed recognisation of
administration among the citizens of the
country.

12
 Chapter - IV
DELEGATED LEGISLATION

Among the sources of law, legislation is of legislation'. Delegated Legislation is also

great importance. It may be termed as supreme known as 'Subordinate Legislation' or
law of the land. The expression 'Legislation' is 'Administrative Legislation'. It means,
derived from two Latin words: legis and lation, "Conferring one's power of law making to
which means 'law' and 'to make' respectively. another". It is the extension of law making
It means, "law making power". The law power to the Executive by the Legislature.
making body/authority is called 'Legislature or E.g.: In India, the legislative authority (law
Legislative Authority". Salmond has classified making body) is parliament. It is not possible"
the legislation into two heads namely: 1) for the Parliament to pass laws at all times in
Supreme Legislation (i.e. the legislation all cases. Hence, it may delegate this law
passed directly by the Sovereign/Supreme making power to the Executive or
Legislature. In India, Parliament is the Administrative Authorities
Supreme Legislature); and ii) Subordinate Definition:- Salmond defines Delegated
Legislation (i.e. 'Legislation passed under the Legislation as 'that which proceeds from any
power/authority delegated to the Executive or authority other than the sovereign power and is
Administrative authority by the Supreme therefore dependent for its continued existence
Legislature). Supreme legislation is the and validity on some superior authority'. In
legislation made by the supreme power in the short, it means and includes 'all rules,
State. Subordinate legislation is the legislation regulations, bylaws, orders etc.'
made by the authority other than the supreme The delegated legislation may be
authority in the State in the exercise of the defined as the legislation made by the
power delegated to it by the supreme authority. authority other than the Legislature acting
The subordinate legislation is dependent on under the' authority delegated to it by the
some superior or supreme authority for its Legislature. According to Jain and Jain, the
continued existence and validity. term 'delegated legislation' is used in two
Meaning and Definition senses:
Meaning a) the exercise by a subordinate agency of
The expression 'Delegation of the legislative power delegated to it by the
Authority or Delegated Authority' means legislature; or
"transfer of authority/power by the superior to b) the subsidiary rules themselves which are
the subordinate". Accordingly, when a made by the subordinate agency in
subordinate by virtue of delegated authority pursuance of the power conferred on it by
passed a law/legislation, it is called 'delegated the legislature.

19
 In the second sense, the 'delegated blood to the skeleton by making rules,
legislation' includes the rules, regulations, regulations, by-laws, orders, etc.
orders, by-laws, etc. Administrative law is (2) Technicality
more concerned with the delegated legislation Sometimes the subject matter of the
used in the first sense. Thus, the administrative legislation is of technical nature and it requires
law is more concerned with the exercise of the handling by the experts. In such cases, it
legislative power by authority other than the becomes necessary to delegate to appropriate
Legislature delegated to it by the Legislature. authority the power to deal with such subject
Reasons for Growth of Delegated Legislation matters.
The Committee on Ministers' powers in (3) Not flexible
England enumerated the following reasons for Delegated legislation or subordinate
the growth of Delegated Legislation (in India legislation is more flexible than ordinary
also): legislation. The rules, regulations, by-laws, or
1. Pressure upon Parliamentary Time; orders, etc. if found to be defective, may easily
2. Technicality (lack of technical know- be amended. The orders, etc. if found to be
how); defective, may easily be amended. The
3. Not flexible (difficulty in amendment) or practice of delegated legislation enables
Rigidity; experiment. If the experiment is found to be
4. Emergency Situations (Emergency unsuccessful, the rules and regulations may be
Decisions Ordinances ); revoked or modified according to the
5. Secrecy (Law cannot be made public till it requirements and if the experiment is found to
comes into force. Secrecy is possible only be successful, the rules and regulations may be
in Delegated Legislation). extended or made perpetual.
(4) Emergency Situations
(1) Pressure upon Parliamentary Time Sometimes the economic and national
In modem welfare State the bulk of emergencies require quick action but because
the Legislature has increased and it does not of being overburdened, the legislature finds it
have sufficient time to discuss minor details very difficult to act as promptly as the
and also to provide all the details. situation demands. Hence, the executive
Consequently, it has to confer on the executive delegates the power to make rules, regulations,
or other agency, the authority to make etc. to deal with such situation.
subordinate legislation (e.g. rules, by-laws, (5) Secrecy
regulations, etc.) to supplement the legislation In some cases the public interest
made by the Legislature. The Legislature, thus, demands that the provisions of the law should
passes skeleton legislation and gives authority not be known until the time fixed for their
to the concerned authority-to supply flesh and operation comes, e.g. imposition of import
duty or exchange control, rationing schemes,

20
etc. This also necessitates the delegation of Tribunals Act, 1985 empowers the center
power to make rules, regulations, by-laws, etc. and Sec.36 empowers the state
to the executive or other agency. government to make rules.
Advantages of Delegated Legislation 4. Central Act may delegate law-making
1. It minimises the workload of Legislature. power to statutory bodies. E.g. Sec.49 of
2. It enables to bring out flexible the Advocates Act, 1961 empowers the
Legislations (E.g. rules, regulations etc.). Bar Council of India to make rules under
3. Legislations on technical matters can be the Act.
done effectively. 5. State Act may delegate legislative power
4. It helps the Government to tackle the to state government. E.g. (i) Sec.69 of the
emergency situations. Andhra Pradesh Panchayat Samitis Act,
Disadvantages or Demerits 1959 empowered the state government to
1. Peoples' Representatives' will is not make rules for carrying out the purposes
present in Delegated Legislation. of the Act. (ii) Sec.99 of the Andhra
2. Public opinion is absent; and Pradesh Education Act, 1982.
3. It is unknown till it is notified. 6. State Act may delegate legislative power
Forms of Delegated Legislation to statutory bodies. E.g. The Andhra
There are six important forms by Pradesh Electricity Act empowers the
which the legislature may delegate the law Electricity Board to make rules under the
making power to the executive as detailed Act.
below: Classification or Types of Delegated
1. Central Act may delegate law-making Legislation
power to the Central Government. E.g. (i) Proper understanding of the subject,
Sec.3 of the Defence of India Act, 1962; delegated legislation has been classified by
(ii) Sec.3 of the All India Services Act, different authors on different basis stated
1951. below:
2. Central Act may delegate law-making 1) Title based;
power to the state government. E.g. (i) 2) Purpose based.
Sec.8 of the Opium Act, 1878; (ii) Sec.2 (1) Title Based Classification
of the Musalman Wakf Act, 1923. On the basis of nomenclature, the
3. Central Act may delegate law making delegated legislation may be classified as
power to both central and state follows:
governments. E.g. (i) Sec.13 of the Mines 1. Rule;
and Minerals Act, 1957 gives power to 2. Regulation;
the central government and Sec.15 gives 3. Order;
power to the state government to make 4. Bye-laws;
rules; (ii) Sec.35 of the Administrative 5. Direction;

21
 6. Scheme. Delegated legislation may be
Rule - It means a rule made in exercise of classified on the basis of the purpose for which
powers conferred by any enactment and the delegation is made, as follows:
includes regulation made as a rule under any a) Power to bring the Act into operation;
enactment. b) Power to extend the scope/life of the Act;
Regulation - It means an instrument by which c) Power to include or exclude persons or
decisions, orders and acts of the government objects;
are made known to the public. In the sphere of d) Power to modify the Act or Statute;
delegated legislation, the term relates to the e) Power to remove difficulties;
situation where power is given to fix the date f) Power to adopt laws from other States;
for the enforcement of an Act or to grant g) Power to prescribe punishments.
exemptions from the Act or to fix prices etc. Power to bring the Act into operation - All
Order - There is not much difference between Acts contain a 'commencement clause'. In
rule and order. Only in the name it differs. majority of the Acts the commencement clause
Depending upon the nature of the power empowers the respective governments to
delegated to the executive, it can make two appoint a day for the commencement of the
kinds of orders such as General and Particular Act to come into force. In such cases, the
orders. commencement of the operation of the Act
Bye-laws - It means rules made by the semi - depends upon the decision of the government,
Govemment authorities established under the e.g. Section 1(3) of the Industries
Act or statute, e.g. rules made by local (Development and Regulation) Act, 1951;
authority, statutory crop., etc. Bylaws are, Consumer Protection Act, 1986; Section 1(3)
thus, made by the semi-Government of the Protection of Civil Rights Act, 1955,
authorities established under the Act or statute. Section 1(3) of the Hire Purchase Act, etc.
They are, thus, made by local authority or Such delegation has been held to be valid. It
statutory corporation, etc. does not amount to excessive delegation.
Direction - Directions are generally framed by Power to extend the scope/life of the Act -
the head of the department to regulate the Sometimes the legislature may pass an Act
internal functions of the department. It may be declaring that it is applicable to limited
mandatory or recommendatory in nature. territories/persons/commodities or it shall
Scheme - It is used to refer to a situation apply for a particular period in the first
where the executive or administrative instance. Later, it empowers the executive to
authority is authorised by the Act or statute to extend its jurisdiction or extends its life for a
lay down a framework within which the further period. E.g. Sec.27 of the Minimum
concerned authority is to function. Wages Act 1952. The Minimum Wages Act,
(2) Purpose Based Classification 1952·which authorizes the Central
Government to include any industry to the

22
schedule containing the list of the industries to in the official gazette, make such provisions,
which the Act is to apply. It has been held not inconsistent with the provisions of this Act
valid because the legislative policy is apparent as appears to be necessary or expedient for
on the face of the Act. Sometimes the removing difficulty."
legislature which passes the Act declare that Power to adopt laws from other States - In
the Act will apply only for particular period this type of delegation the executive is given
and empowers the executive to extend its life the power to adopt and apply statutes existing
or duration, e.g. The Bihar Maintenance of in other states. E.g. Sec.7 of Part C States Law
Public Order Act, 1948. Act delegates powers to the central
Power to include or exclude persons or government to extend to any Part-C state, with
objects - The legislature may pass an Act such restrictions and modifications, as it thinks
applicable to a particular individual, class or fit, any enactment, which is in force in any
persons, institutions, or commodities, but Part-A state.
empowers the government to include any other Power to prescribe punishments - In this
similar type of individuals, class or persons, type of delegated legislation the law will be
institutions, or commodities within the made in its full form by the legislature, but the
purview of the Act. Similarly, the Act may executive will be empowered to prescribe
empower the Government to exempt certain punishment for the breach of the provisions of
persons, class of persons, institutions from its the Act subject to the maximum punishment
operation or commodities. laid down in the Act, E.g. Sec.37 of the
Power to modify the Act or Statute - Electricity Act, 1910. (If the maximum
Sometimes the Act or statute making the punishment is not prescribed in the Act the
delegation of legislative power authorises the delegation can be held invalid on the ground of
executive to modify the Act or statute itself. excessive delegation).
Sometimes it becomes necessary to enable the Limits and Constitutionality of Delegated
executive to meet the changing circumstances. Legislation
Consequently, such delegation is, often held There is no express provision
valid, if there is no change in the legislative empowering the legislature to delegate law-
policy of the Act or statute. making power to the Executive. However,
Power to remove difficulties - Some statutes Article l3(3)(a) confers on the legislature, to
authorise the government to modify the delegate law-making power to the Executive.
provisions of the parent Act for the purpose of However, Article 13(3)(a) confers on the
removing difficulties. E.g. Sec.34 of the legislature, implied authority to delegate the
Administrative Tribunals Act, 1985 which law making power. Art. 13 (3)(a) defines the
reads as follows: "If any difficulty arises in term 'law'. According to this Article, "law"
giving effect to the provisions of this Act, the includes any rules, orders, byelaws,
Central Government may, by order published regulations and notifications etc. This wide

23
definition for law given under Art. 13 (3)(a) 2. Delegatus non-protest delegare: It means
impliedly covers the area of delegated a delegate cannot further delegate. The
legislation also. The constitutionality of the Congress gets power from people and is a
delegated legislation can be better studied by delegate. Being a delegate, it cannot
analysing the judicial pronouncements of the further delegate its power to another.
Privy Council upto 1949 Federal Court after In spite of this above two doctrines,
1949 and the Supreme Court of India after the U.S Congress (legislature) has power to
1950. delegate its law making power subject to
Delegated Legislation in England fulfilment of certain conditions.
In England, Parliament is supreme. It In Yakus v. United States 9 , case the
has unlimited powers to make any law. It delegation by the Congress was held to be
cannot be questioned by the Court on any valid on the ground that the statute making the
ground. So there is no limit on the Parliament delegation prescribed sufficiently definite
in the case of delegation of its power to the standards to guide the delegate. In this case the
executive. The Parliament need not provide validity of delegation by the Emergency Price
any standard for the exercise of that power. Control Act, 1942 to the Price Administrator
There is no external authority to compel the was challenged. This Act empowered the Price
Parliament to provide policy or safeguards in Administrator to establish 'such maximum
the statute delegating legislative power. The price or prices as in his judgment will be
remedy against misuse lies in the parliament generally fair and equitable and will effectuate
itself. It can control delegation if it pleases. the purposes' of the Act in case in his opinion
Delegated Legislation in U.S.A. the commodity prices rose or threatened to rise
Delegated Legislation in U.S.A. may to an extent or in a manner inconsistent with
be explained with reference to: the purposes of the Act.
a) In theory; and In Practice
b) In Practice. In Practice, it is not possible in
In theory America to stick on to the above rule. In view
In U.S.A, the law of delegated legislation of the expansion of governmental functions, it
is based on two doctrines viz. '"[he doctrine of is not possible for the Congress to enact all
separation. of powers and delegates non- statutes with all particulars.
protest delegare. In other words, delegated In Panama Refining Co. vs. Ryan 10 (Hot oil
legislation is not accepted in U.S. Constitution case) under Section 9 (c) of the National
in theory for two reasons namely: Industrial Recovery Act (NIRA), the President
1. The Doctrine of separation of powers is was authorised by the Congress to prohibit
adopted in U.S. Constitution and hence, transportation of oil in inter-state commerce in
the U.S. Congress cannot delegate
9
. 321 U.S. 414, 64 S. Ct. 660 (1944)
legislative power. 10
. (1935) 293 US 388

24
excess of the quota fixed by the concerned down in parent Act certain conditions-(viz.
state. The Supreme Court by majority held that Thing to be taxed, extent of taxation etc.).
the delegation was invalid. According to the There had been a controversy as to the
Court the Congress had not declared competence of the legislature to delegate
legislative policy or standard. taxing power to the Executive without
Delegated Legislation in India prescribing any limits.
The Delegated Legislation in India In Devi Das vs. State of Punjab11, the
may be studied with reference to: Supreme Court held that the legislature cannot
1) Pre-Constitution Period; and delegate tax fixing power to the Executive.
2) Post-Constitution period. But, in the case of Corporation of
Pre Constitution Period Calcutta vs. Liberty Cinema 12 , the Supreme
In India, Delegated Legislation is Court justified the delegation of taxing power
accepted both in Pre Constitution and Post- to the Executive, provided necessary
Constitution period. During the period of King guidelines are provided. This view was
Henry III, the executive under the delegated followed in subsequent cases.
legislation was empowered to amend the Sub-Delegation
parent act. Meaning
Post-Constitution period Delegated Legislation means
With regard to Post-Constitution 'Conferring one's power of law making to
period, the principle of delegated legislation is another, or extension of law making power to
well accepted. Indian Parliament conferred on the Executive by the Legislature. If the
Executive and other Administrative Executive, i.e. the delegate further delegates
Authorities to formulate laws, rules, such power to any subordinate authority or
regulations, bye laws etc. for the peaceful and agency, it is called' Sub-Delegation'. The
successful administration of the Government. authority which confers law-making power on
Delegation of Taxing Power (Taxing delegate is called 'Parent' or 'delegate' and the
Statutes or Delegation in Taxing further delegates are called 'Children'.
Legislation) Criticism:- There is a well-known maxim,
The power to levy tax is an essential which criticises sub-delegation. It is 'Delegatus
function. According to Article 265 of the non protest delegare', which means, "a
Constitution, no tax can be levied or collected delegate cannot further delegate". This
without the authority of law. Law, here means principle applies in case of delegated
'law passed by the competent legislature'. The legislation also unless there is an express or
legislature cannot delegate the power to implied provision to that effect. It is also
impose tax to any (Executive) Authority. contended that sub-delegation is against the
However, certain permissible limits
11
. 1967 AIR 1895
have been provided for to levy tax, after laying 12
. 1965 AIR 1107

25
principles of rule of law and Parliamentary 1) Hart
Sovereignty. 'Conditional legislation is a statute that
13
In Jackson vs. Butterworth - Certain provides controls but specifies that they are to
circulars issued by the sub-delegate were held go into effect only when a given
to be bad (invalid). administrative authority fulfils the existence of
Position in India conditions defined in the statute.'
In India also, the principle of sub 2) Cooley
delegation is not accepted unless there is an 'It is not always essential that a
express or implied provision by the statute. legislative act should be a completed statute
Ganapati vs. State of Azmeer 14, in this case, which must in any event take effect as law at
the Parent Act conferred on the Chief the time it leaves the hands of the legislative
Commissioner to frame rules for proper department. A statute may be conditional, and
system of conservancy and sanitation at fairs. its taking into effect may be made to depend
The rules made by the Chief Commissioner upon some subsequent event'.
were further conferred on the District Types/Classification of Conditional
Magistrate to devise his own system. The Legislation:
Supreme Court held the rules framed by the 1. This type of legislation is seen in almost
District Magistrate Ultra vires. all the statutes, where the date of
Conditional or Contingent Legislation commencement of the Act is left to the
Meaning discretion of the Executive.
Conditional legislation is also known 2. The Executive is given power to extend
as Contingent legislation. It comes into force the life of the Act.
upon the happening of a contingency or upon 3. Statute confers power on the Executive to
the fulfilment of a condition by the Executive. apply and adopt the statutes in other
It was invented/introduced by the British states.
Parliament to enabling itself to rule its 4. The executive may be empowered to
colonies. extend the provisions of the Act to more
In this case, the legislature makes law territories.
in full and complete. No legislative power is Distinction between Delegated Legislation
delegated to the Executive. It is left to the and Conditional Legislation
Executive to bring the Act into force on Sr. Delegated Conditional
fulfilment of certain condition or contingency. No. Legislation Legislation
Such legislation is called 'Conditional or 1 It is also known as It is also known as

Contingent' Legislation. 'Subordinate 'Contingent

Definition Legislation Legislation.'

13
. [1946] VLR 330
14
. AIR 1955 SC 188

26
2 In delegated In conditional 'Henry VIII Clause type of delegated
legislation, the legislation, power legislation.' It implies a naked delegation of
legislature confers to legislate/pass essential legislative power to the executive by
power on the sub- law is conferred the legislature.
ordinates i.e. on the executive Object
executive to subject to The main object of the Henry Clause
legislate/ pass law fulfillment of a VIII type of delegated legislation is to remove
condition by the certain difficulties. King Henry VIII succeeded
executive. in removing all difficulties in the enforcement
3 It is not subject to It is subject to of his will by resorting to/adopting this type of
fulfillment of a fulfillment of a delegation. E.g. National Insurance Act, 1911
condition or condition or in England.
happening of happening of a The Henry VIII Clause type of delegated
contingency contingency. legislation should be conferred on the
4 The subordinate The subordinate executive only in exceptional cases to remove
authority, which is authority has no difficulties.
conferred law such discretionary Position in England
making power power. In England, National Insurance Act,
Exercises 1961 empowered the Insurance
discretionary Commissioners 'to do anything that they
power in law thought necessary and expedient if any
making. difficulty arose in bringing the Act into
operation and for that purpose modify the
Henry VIII Clause provisions of the Act itself.'
The expression 'Henry VIII Clause' In England such type of delegations
refers to "Executive Authority". Generally, any could not be challenged, as the Parliament is
legislature, while delegating its power of law superior there. Hewart in his book 'The New
making to the Executive does not confer Despotism' published in 1929 criticised this
power on the executive to amend or vary the type of delegation severely. The Committee on
Parent Act. If a clause is inserted in the statute Ministers' Powers also criticised the use of the
conferring power on the executive to amend or Henry VIII Clause, and suggested that this
vary the Parent Act, it is called "Henry VIII clause should be used for the sole purpose of
Clause". In England, during the period/ regime bringing an Act into operation and that too
of the King Henry VIII, several laws were only for a period of one year from the passing
passed empowering the executive to even to of that Act and that too only when
amend the Parent Act. This type of delegated 'demonstrably' essential.
legislation is popularly known/nicknamed as

27
 In October 1929 the Parliament Now, in India Henry VIII Clauses are
appointed a Committee on Minister's Powers not valid. There is no statute containing Henry
to enquire into the subject of delegated VIII Clause type of delegation. The Supreme
legislation. The Committee in its report Court of India quashed such type of delegation
pointed out that such broad delegation is (Jalan Trading Company vs. Mill Mazoor
against the principles of parliamentary Union, AIR 1967 SC 497).
government and the permissible limits of
delegated legislation. Following DELEGATED LEGISLATION
recommendations were made by the (CONTROLS AND SAFEGUARDS)
committee. CONTROL OVER DELEGATED
i. Henry VIII type of delegation should be LEGISLATION
avoided, as far as possible and to be Introduction:- In modem welfare state, the
resorted only sparingly under exceptional workload of the legislature has increased
and extraordinary circumstances in which tremendously and hence, it has become
it was absolutely necessary. incompatible (inevitable) to resort to delegated
ii. Such clause should be given effect only legislation (to delegate the power of law
for a limited period of one year from the making to the subordinate authority/the
date of passing of the Act, that too only Executive). The legislature, therefore, passes
for the removal of difficulties arising in the skeleton legislation and empowers the
the implementation of the Act. concerned authority to supply flesh and blood
After this recommendation of the to the skeleton by rules, regulations, etc. The
committee, the Henry VIII clause type of system of delegated legislation reduces the
delegation was almost stopped in Britain. burden or workload of the legislature and
Position in India:- In India Henry VIII Clause thereby enables the legislature to give
type of delegation was sparingly adopted in sufficient time for the considerations on the
past. E.g. I) Sections 120 and 128 of the State policy matters.
Re-organisation Act, 1956 contained such a The legislature i.e. the Parliament lays
clause (now repealed); ii) Article 392 (1) of down essential legislative policy in the Parent
the Constitution (42nd Amendment Act, 1976) Act and delegates the power to the Executive,
empowered the President to make such Owing to complexity, diversity, emergency
provisions including any adoption or etc. certain essential legislative powers escape
modification of any provision of the into the Executive fold. In order to check such
Constitution as appeared to him to be excessive delegation and to keep the delegated
necessary or expedient for the purpose of legislation within its limits certain control
removing the difficulties in the constitutional mechanisms are necessary to safeguard the
provisions (repealed by Constitution 44th legislative power from abuse/criticism. Such
Amendment Act, 1978). controls are as follows:

28
1. Judicial Control. point is Chintaman Rao vs. State of M.P.15 The
2. Legislative or Parliamentary Control; and District Collector under delegated authority
3. Other Controls. passed an order prohibiting beedi manufacture.
(1) Judicial control over the Delegated It was held ultra vires, since it violates
Legislation freedom of trade and profession guaranteed
In the control mechanism of delegated under Article 19(1)(g) of the Constitution.
legislation, judicial control occupies first (2) Delegated Legislation Ultra Vires the
place. The history of judicial control over Constitution
Delegated Legislation can be traced back to as Sometimes, the Parent Act holds good,
early as 1877 in Queen vs. Burah : The and is within the limits '- of the Constitution.
Calcutta High Court declared a delegated However, the delegated legislation made under
legislation invalid. the Parent Act may be ultra vires the
Grounds for Judicial Control/Review:- Constitution.
Judiciary can control/review the delegated In Air India vs. Nergesh Meerza 16. The
legislation on the following grounds: regulation may be Air India providing for
1. The Parent Act is ultra vires the termination of service of an airhostess on her
Constitution. first pregnancy, was held violative of Article
2. Delegated Legislation is ultra vires the 14 of the Constitution.
Constitution. (3) Delegated Legislation is ultra vires the
3. Delegated Legislation is ultra vires the Parent Act
Parent Act. The validity of delegated legislation
4. Delegated Legislation ultra vires the can be questioned on the ground that it is ultra
General Law. vires the Parent Act. In Ram Prasad vs. State
17
5. Unreasonableness. of U.P. The Uttar Pradesh Panchayat Raj
6. Mala fide. Rule 87 framed under the Parent Act (U.P.
7. Sub-Delegation; and Panchayat Raj Act, 1947) was held to be ultra
8. Excessive Delegation. vires the Parent Act.
The expression' Ultra Vires' means (4) Delegated Legislation Ultra Vires any
beyond powers. (Ultra means beyond, Vires General Law/Rule of Law
means power). The validity of the Delegated
(1) Parent Act is ultra vires the Constitution Legislation can be challenged on the ground
If the Parent Act violates the that it is ultra vires the general law. It takes
provisions of the Constitution, It is void and place, when the delegated legislation makes a
unconstitutional. The delegation made under law in force unlawful and unlawful act lawful.
such Act also is void. Relevant case on this
15
. AIR 1951 SC 118
16
. AIR 1981 SC 1829
17
. AIR 1952 All 843

29
 In A. V. Nachane vs. Union of India 18 delegated authority in making laws is properly
In this case the rules framed by the Union exercised.
Government under delegated authority by The Legislative or Parliamentary
L.I.C. with regard to bonus to Class-III and control over the Delegated legislation can be
Class-IV employees was held ultra vires since effectively exercised by:
it supersedes the terms of the Bonus 1. Laying on the Table; and
Settlement 1974. 2. Scrutinizes Committee.
(5) Unreasonableness (1) Laying on the Table
Generally, a statute cannot be It means placing before the table. It is
challenged on the ground of unreasonableness. made to make the~leiis1ators know, as to the
But, in exceptional cases, it can be challenged law making power to be conferred on the
on the ground of unreasonableness. 19 Executive. It also gives an opportunity to the
(6) Mala fide (Bad faith) members to question or' challenge the
Mala fide means 'bad faith' or ulterior proposed delegation of authority on the
motive. Delegated Legislation can be Executive. There are several types of laying.
challenged on the ground of Mala fide, if it has The select committee on Delegated
no relation to the purpose for which the law legislation in its report in 1953 summarized
making power was delegated. laying procedure under different heads. They
(7) Excessive Delegation are:
In India, only in few cases, delegation (1) Simple laying: The rules will come into
of law making power is struck down by the force as soon as they are laid before the
Courts on the ground of excessive delegation. House. The object of this type of laying is
(8) Sub-Delegation to inform the House about the rules and
As stated above, the principle of sub- regulations. Here there is no effective
delegation is subject to criticism and not control at all.
accepted, unless there is a provision express or (2) Laying subject to annulment: Here also
implied to that effect. Hence, the validity of an the rules will come into force as soon as
act under sub-delegation can be questioned they are placed before the House. But
ultra vires) those rules can be amended or annulled
(2) Legislative or Parliamentary Control by the House through a resolution. This
over Delegated Legislation type of laying is a check on the rule
The Parliament or Legislature, which making power of the executive.
delegates law making power on the Executive (3) Laying subject to affirmative
has a duty to see and check whether such resolution: The rules will not have any
effect unless approved by the House
through resolution. This type of laying is
18
. AIR 1982 SC 1126
19
. State of Assam vs. Om Prakash 1973 AIR 678

30
 the most effective control over delegated appointed by the Loa Sabha speaker for a
legislation. period of one year. Ministers are prohibited
(4) Laying subject to negative resolution: If from becoming members. Generally all
there is any provision for such a type of decisions are taken unanimously and party
laying, the draft Rules must be placed considerations are not given importance. The
before the House. Such rules shall come Chairman of the committee will generally be a
into force after forty days from the date of member of the opposition.
laying unless it is disapproved by the The Rajya Sabha Committee on
House before that period. Subordinate Legislation: It was established
(5) Laying of draft rules: There may be in 1964. It also consists of fifteen members.
provision requiring laying of draft rules Both the members and Chairman of the
before the House. Laying draft rule with Committee are nominated by the Chairman of
affirmative resolution is considered to be the Rajya Sabha. In the case of Rajya Sabha
one of the most effective controls. The Committee, ministers also can become
draft rules shall not have any effect unless members. The committee will continue in
approved by the House. In India only a office till a new committee is appointed.
handful of the Acts have provided laying Since from the establishment to till
procedure. But by the Delegated today the committees always objected about
Legislation Provision (Amendment) Act, the laying down formula not followed by the
1983, amended nearly fifty statutes and govt. as it resulted in dilution of the legislative
inserted provision for laying before the control over the delegated legislation.
House. FUNCTIONS OF THE COMMITTEES
(2) Scrutiny Committees These are as follow –
Parliament would be of no use, unless I. To scrutinize & report to the respective
the rules are properly studied and scrutinized. houses whether the power to make
In order to strengthen the parliamentary legislations, rules, sub rules, bylaws etc.
control over Delegated Legislation, scrutiny conferred by the constitution or delegated
committees are constituted. In India, two types by the Parliament are being properly
of such committees are established. exercised within such delegations &
They are: II. They act as a watchdog, which bark &
1. The Lok Sabha Committee on arouse their masters from the slumber
Subordinate Legislation; and when they find that invasion on the
2. The Rajya Sabha Committee on premises has taken place.
Subordinate Legislation. IMPORTANT RECOMMONDATIONS
The Lok Sabha Committee on Subordinate OF THE COMMITTEES
Legislation: It was established in 1953. It The recommendations & suggestions
consists of fifteen members. The members are given the committees acts as the stipulations

31
on the delegated legislation. Some of the Thus it’s secondary control by the
important recommendations of these legislation on the delegated legislation but
committees are as follow – it can’t neglect as it provides affirmative
1) Power of the judicial review should not be approval which itself resort out various
taken away or curtailed by the rules of the difficulties while delegated legislative
delegate legislations, power delegated to the executives.
2) A financial or levy of tax should not be
imposed by the rules of delegated 3. Other Controls
legislation, In addition to the above, there are
3) Language of rules should be simple & other controls and safeguards to regulate
clear and not ambiguous, delegated legislation in the form of firstly
4) Rules should not be given the Publication, Consultation of the Interested
retrospective operation unless provided in Groups. Since the modern technique of the
the Parent Act as they may prejudicially delegated legislation require in relation to
affect the vested rights of persons, social & economical matters the participation
5) Legislative policy must formulated by the of the interested groups is required in order to
legislatures only & details left to the maintain the democratic system of the Nation
executives, other wise it will be antidemocratic. secondly
6) Sub delegation allowed as per proper sub-delegation as discussed below –
authority, 1. Publication
7) Discriminatory rules shouldn’t framed by As we know the ignorance of law no
the administrative authorities, excuse, but this can be legitimized only after
8) Rules shouldn’t go beyond the rule the publication of law, therefore it is duty of
making power given by the Parent Act, the concerned authority that people should
9) Final authority of interpretation of the come to know what law is?
rules shouldn’t be with the administrative The people may came to know the law
authority, by the means of (1) debates & discussion in
10) The Principles of Natural Justice must be the Parliament, (2) Public opinion about the
followed while giving the delegated new law & (3) through the electronic media.
legislation whenever the individuals rights Then only we can say that ignorance of law is
& liberties are involved, no excuse.
11) Removal of difficulties clause must no 1) Position in USA
given to the administrative authorities as it Before 1935 there was no such
indirectly gives power of amendment of provision for the publication of the delegated
the statute itself therefore it is legislation, therefore people get affected due to
undemocratic one, etc. lack of knowledge so that Congress enacted
following statutes –

32
(1) Federal Registration Act Importance of the Publication
To provide the publication of all The publication is important because it
Federal rules & regulations. gives -
(2) Administrative Procedure Act, 1946 1. Certainty,
U/s. 552 it is provided that every agency was 2. Uniformity,
required to publish in the 3. Predictability &
Federal Register in the fields of procedural or 4. Legitimacy to the law
substantive rules. Due to these reasons the Publication
U/s. 553 it is provided that the rules shall be became the integral part of the access to
published at least 30 days before the Justice.
delegation. In Govindlal v. Agricultural product
Thus these Acts strengthen the notion Market Committee Case21 the notification the
of delegated legislation in the USA. regulation of purchase & sale of the
2) Position in UK agricultural product must be publish by the
In UK it is compulsory to publish the director of Agricultural & Market Committee
delegated legislations under the Statutory in Official Gazette & Gujrati newspaper. He
Instruments Act, 1946. published the regulation only in the Official
3) Position in India Gazette & not in the Gujrati newspaper.
We don’t have the specific statute The SC held that intention of
therefore lots of difficulties are aroused. In publication is to make the people inform about
1960 govt. of India published various rules & the regulations the publication in the Official
titled them as “Statutory Rules & Order”. But Gazette doesn’t help the peoples in the remote
inspite of this the publication remains essential area, therefore the double publication as per
to give the validity of the delegated legislation. the statute is required so it publication in only
In Harla v. State of Rajsthan case20 the Official Gazette not meeting the standard of
law in question make by the executives the publication.
remained unpublished for several years. The In Maharashtra v. George Case 22 the
SC held that even in absence of statutory notification of the Reserve Bank of India on 8th
provision if delegated legislation not published Nov. 1962 published in the Official Gazette on
such delegate legislation would be invalid 24th Nov. 1962. The person taking gold to
because publication is the kind of aspect of foreign on 27th Nov. 1962 arrested.
Principles of Natural Justice, therefore it The SC held that since the notification
should be publish the delegated legislation in published in the Official Gazette its ignorance
order to meet the standard of law & their on part of accused is totally irrelevant.
behavior.

21
. AIR 1976 SC 263
20 22
. AIR 1951 SC 467 . AIR 1965 SC 722

33
 But this decision is creatised as this (2) limitation by the delegated legislation in
decision was not rigid but also not liberal one order to avoid the excessive delegated
as court ignores the reasonability of rule or legislation or blame of ultra vires conduct.
order i.e. what law ought to be & not what law The committees on subordinate
is? legislation observed that while law making
When delegated legislation came into effect power delegated to sub-delegation the
on amendment? language should be clear & not vague i.e.
The committees observed that when language should be as per the Parent Act & if
rule amended still the proper publication is Parent Act silent then sub-delegation not
required, as information to public is the basis allow.
of binding the standard of people’s behavior as
per the law. Control on the Sub-delegation
The control on sub-delegation is
2. Sub-delegation similar as per control on delegated legislation
While sub-delegate the legislative i.e. -
powers by the delegated legislation there is a I. Laying down,
question of what extent it permit & what kind II. Scrutiny amd
of control mechanism? E.g. Essential III. Publication.
Commodities Act, u/s. 5 the central govt.
might delegate its power either to state govt. or
other officers, therefore it amount to sub-
delegation.
Criticism
1. No accountability towards the legislation,
2. It is undemocratic as no represent will of
the people
But even though above criticisms are
no such ground based as statute itself laid
down certain general principles, Standard &
Policies. Thus the Parent Act is the genus from
which the sub-delegation derives its power;
therefore on the sub-delegation there are
double limitation – (1) limitation by the
Parent Act &

34
 Chapter - V
ADMINISTRATIVE TRIBUNALS

I. ADMINISTRATIVE TRIBUNALS Meaning

In Administrative law, the term ‘tribunal’ The word 'Tribunal' means "seat or
is used in a significant sense and refers to only bench upon which a judge or judges sit in a
the adjudicatory bodies which lie outside the court or court of justice". It is a judging body
sphere of the ordinary judicial system. that is appointed to make a judgment or
Technically in India, the judicial powers are enquiry and includes even ordinary courts. In
vested in the Courts which aims to safeguard Administrative Law, the term 'Tribunal' is used
the rights of the individuals and promotes to refer to bodies other than the regular courts
justice. Therefore, to institute an effective of the land. In simple words, tribunal is a body
system of the judiciary with fewer with judicial or quasi-judicial
complexities, the judicial powers are delegated powers/functions set up by the statute outside
to the administrative authorities, thus, giving the usual judicial hierarchy of Supreme Court
rise to administrative tribunals or and High Courts. The word 'tribunal' is wider
administrative adjudicatory bodies which than 'court', and hence it is said that "all courts
holds quasi-judicial features. are tribunals, but all tribunals are not courts. A
History of Tribunalisation body, which determines controversies or the
The concept of tribunalisation came into rights of parties, is called a 'tribunal', when it
existence in India with the establishment of the possesses some but not all the trappings of a
Income Tax Appellate Tribunal before the court.
independence of the country. After Examples:.- i) Industrial Tribunal set up under
independence, a need was being felt for the Industrial Disputes Act, 1947; ii) Income
resolving administrative disputes with Tax Appellate Tribunal constituted under the
flexibility and speed. The core objective of Income Tax Act, 1961. There are certain
tribunalisation was to provide specialised and administrative tribunals, which are termed as
speedy justice to the people. courts, but they are not strictly courts, and they
After the drafting of the Indian are only tribunals. (E.g.) i) Employees'
Constitution, several rights for the welfare of Insurance Court under Employees' State
the individuals were guaranteed by the Insurance Act, 1948; ii) Labour Court under
Constitution. People have the right to speedy Industrial Disputes Act, 1947.
trials and of specialised quality which cannot Definition
be delivered by the prevailing judicial system The word tribunal has been used in
due to the overburden of cases and appeals, Articles 136 and 227 of the Constitution of
technicalities in procedure etc. India, but it has not been defined in the

35
Constitution. In Administrative Law, the word Constitution, tribunals are to be organized and
'Tribunal' is used to refer to the adjudicatory established in such a manner that they do not
bodies outside the sphere of ordinary courts. A violate the integrity of the judicial system
tribunal may be defined as a body independent given in the Constitution which forms the
of a department, which is entrusted with basic structure of the Constitution.
adjudicatory function and whose decisions are The introduction of Article 323A and
binding on the parties (subject to regular 323B was done with the primary objective of
appeal). excluding the jurisdiction of the High Courts
Durga Shanker Mehta vs. Raghuraj under Article 226 and 227, except the
Singh 23 in this case, Supreme Court defined jurisdiction of the Supreme Court under
'tribunal' in the following words: " ... The Article 136 and for originating an efficacious
expression 'Tribunal' as used in Article 136 alternative institutional mechanism or
does not mean the same thing as 'Court' but authority for specific judicial cases.
includes, within its ambit, all adjudicating The purpose of establishing tribunals
bodies, provided they are constituted by the to the exclusion of the jurisdiction of the High
State and are invested with judicial as Courts was done to reduce the pendency and
distinguished from administrative or executive lower the burden of cases. Therefore, tribunals
functions. are organised as a part of civil and criminal
24
Bharat Bank vs. Employees in this court system under the supremacy of the
case, the Supreme Court observed that though Supreme Court of India.
tribunals are clad in many of the trappings of a From a functional point of view, an
court and though they exercise quasi-judicial administrative tribunal is neither an
functions, are not full-fledged courts. Thus, a exclusively judicial body nor an absolute
tribunal is an adjudicating body, which decides administrative body but is somewhere between
controversies between the parties and the two. That is why an administrative tribunal
exercises judicial powers as distinguished is also called ‘quasi-judicial’ body.
from purely administrative functions and thus Characteristic Features of a Tribunal
possesses some powers of a court, but not all. Following are the features of the
Growth of Administrative Tribunals administrative tribunals:
The 42nd Amendment to the i. Administrative tribunals are established
Constitution introduced Part XIV-A which by the government by a statute or under a
included Article 323A and 323B providing for statute.
constitution of tribunals dealing with ii. It performs quasi-judicial functions.
administrative matters and other issues. iii. Its proceedings are deemed to be judicial
According to these provisions of the proceedings.
iv. It is not bound by the provisions of the
23
. AIR 1954 SC 520 (522)
24
. AIR 1950 SC 188 Code of Civil Procedure, 1908 or the

36
 Indian Evidence Act, 1872. It follows the organisation" and "administration" 'means the
rules prescribed by the statute under management of the affairs of a business or
which, it has been created and the organization or executive branch of a
principles of natural justice. In certain Government.
cases the tribunal is left free to develop its Administrative Tribunal is a body
own procedure. constituted under a Statute to perform
v. It has the power to compel the attendance adjudicatory functions of the management of
of witnesses (just like a civil court) and its the affairs of an organization or executive
proceedings are just like a civil court branch of a government. The Administrative
proceedings. Tribunals are not courts, but are vested with
vi. In their proceedings it has to follow the State's inherent judicial power. They are
openness, fairness and impartiality set up to perform quasijudicial functions.
(principles of natural justice). Kinds of Administrative Tribunals:- In India,
vii. It is independent and not subject to any different kinds of Administrative Tribunals
administrative interference in the exist as stated below:
discharge of its functions. 1) Income Tax Appellate Tribunals: It is
viii. It mainly decides disputes arising out of created/ constituted by the Central
the policies and programs of the welfare Government under Section 252 of the
state. Income Tax Act.
ix. These tribunals are bound to abide by the 2) Industrial Tribunal: The Industrial
principle of natural justice. Tribunal and National Tribunal are
x. A fair, open and impartial act is the created by the Central Government under
indispensable requisite of the Section 7-A and 7-B respectively of the
administrative tribunals. Industrial Disputes Act, 1947 (to settle
xi. The prerogative writs of certiorari and the disputes between the Employer and
prohibition are available against the Employees).
decisions of administrative tribunals. 3) Railway Rates Tribunal: It is constituted
xii. In the absence of any statutory provision, under the Indian Railway Act, 1890.
a tribunal cannot review its own decision. 4) Administrative Tribunals under the
Kinds of Tribunals Administrative Tribunals Act, 1985:
Tribunals may be classified into: a) Administrative Tribunals for service
1. Statutory or Administrative Tribunals; matter (Article 323A) - Article 323A
and provides the establishment of
2. Domestic Tribunals. administrative tribunals by law made
Statutory or Administrative Tribunals by Parliament for the adjudication of
The word' Administrative' means "of disputes and complaints related to the
administrative relating to a business or recruitment and conditions of service

37
 of Government servants under the jurisdiction, powers of such tribunals
Central Government and the State and lays down the procedure to be
Government. It includes the followed.
employees of any local or other
authority within the territory of India Need for the Establishment of
or under the control of the Administrative Tribunals
Government of India or of a 1. The courts are over burdened and there is
corporation owned or controlled by the inordinate delay in the delivery of justice
Government. as they are not able to dispose of the cases
The establishment of such quickly. The Tribunals Inquiries Act,
tribunals must be at the centre and 1971 was passed and a Council on
state level separately for each state or Tribunals has been constituted.
for two or more states. The law must 2. Due to the adoption of Welfare State,
incorporate the provisions for the there has been enormous increase in the
jurisdiction, power and authority to be functions of the government. With this,
exercised by tribunals; the procedure there arise a number of new problems. To
to be followed by tribunals; the solve the new problems arising from the
exclusion of the jurisdiction of all activities of government, administrative
other courts except the Supreme Court adjudication came into existence to lessen
of India. the burden on the court.
b) Tribunals for other matters (Article 3. Administrative Tribunals are intended to
323B) - Article 323B empowers the provide quick justice- Speeding up the
Parliament and the State Legislature procedure by overriding the procedure
to establish tribunals for the laid down in the Civil Procedure Code or
adjudication of any dispute or the Evidence Act.
complaint with respect to the matters 4. The expenses to get justice in ordinary
specified under clause (2) of Article cases are very high as they have to engage
323B. Some of the matters given advocates and long period is required to
under clause (2) are a levy, decide the cases. The expenses in
assessment, collection and Administrative Tribunals are low when
enforcement of any tax; foreign compared to that of ordinary Courts.
exchange and export; industrial and 5. Some cases require persons having
labour disputes; production, special experience and training in
procurement, supply and distribution particular field to decide the cases, as the
of foodstuffs; rent and it’s regulation judges of ordinary Courts are generic. It is
and control and tenancy issues etc. better to entrust such cases to the
Such a law must define the Administrative Tribunals created

38
 specially for certain purposes consisting to a lot of problems. If all these problems
of the experts in the subjects. are left to the Courts, the courts will be
6. The Courts deal with the cases in overburdened. It will also slow down the
accordance with law and they are fit to welfare measures taken by the
deal with the cases consisting policy Government. So it was necessary to
consideration. Such issues can be dealt develop administrative adjudication, to
with better if they are entrusted to the solve those problems. It will respond to
Administrative Tribunals. the social needs, better than the Courts.
As per Kagzi, Administrative ii. The problems arising from the modem
Tribunals are needed as they discharge their welfare government needed policy
functions more rapidly, more cheaply more considerations also. Courts will not take
efficiently than ordinary Courts, possess such matters into consideration.
greater technical knowledge and fewer Adjudicatory bodies outside the courts
prejudices against the Government, give can have such facilities.
greater lead to the social interests involved, iii. Expert knowledge is required to solve the
decide disputes with conscious effort at modem problems.
furthering social policy embodied in the iv. A judge is a generalist. An expect can
legislation. adjudicate such problems better than a
Reasons for the growth of Administrative generalist.
Tribunals or Merits:- The change of v. Adjudication in a Court will take much
Government's philosophy from the laissez time because of the elaborate procedures
faire' to the 'social welfare state' has inevitably and other technicalities. Administrative
led to a phenomenal growth of administrative adjudication on the other hand, is speedy
law. Owing to the expansion of the and free from such formalities and
governmental machinery in the modem technicalities.
welfare state, the ordinary courts of law are vi. Administrative adjudication is cheaper
overburdened and find it difficult to solve all and more flexible compared to the
the problems. In order to overcome this ordinary Courts.
situation and to minimise the workload of the De-Merits
courts, many administrative tribunals have Administrative Tribunals suffer from the
been emerged in India. There are more than 50 following:
tribunals functioning under various i. There is no uniformity in the composition
enactments. The main reasons for the growth and procedure of the Administrative
and development of Administrative Tribunals Tribunals. Each Tribunal is formulated by
are detailed below: separate statute and that statute lays down
i. The modem welfare state has undertaken the rules of procedure of that particular
many welfare measures, which gave rise Administrative Tribunal.

39
 ii. All judges who are members of the Bench respect of the areas of law for which they
are law graduates qualified to be have been constituted.
appointed as Judges. But, all the members ix. Administrative Tribunals cannot review
of the Tribunals are not required to be their decisions unless the powers to
legal experts or to possess legal review their decisions have been
qualifications. The appointment of conferred on them by the relevant
Administrative Members to statutes.
Administrative Tribunals is a drawback. Distinction between 'Court' and 'Tribunal'
iii. There may be poor quality of Sr.
Court Tribunal
No.
investigation into the question of fact in
1 The institution of The institution of
the case of Administrative Tribunals. One
Court is traditional Tribunal recent
of the criticisms against the
i.e. some centuries development
Administrative Tribunals is lack of proper
old.
cross-examination.
2 Court deals with Tribunal deals
iv. There will be departmental bias in the
all matters with service
Governmental Administrative Tribunals.
including service matters only.
v. There may be no uniformity in the matter
matters
of appeal against the decisions of the
3 It is It is
Tribunals. The provisions of appeals may
headed/presided headed/presided
be differently provided in different
over by a person, over by an expert
statutes.
who is an expert in in law in certain
vi. The Administrative Tribunals are not
legally qualified. cases and in other
competent to test the constitutional
cases by an
validity of statutory provisions.
official not trained
vii. The functions of the Administrative
in law.
Tribunals are only supplementary and all
4 The decision of The decision of
such decisions of the Tribunals will be
the Court is the Court is
subject to scrutiny before the Divisional
objective. Its subjective. It
Benches of the respective High Courts.
decisions based on decides the
The Power vested in the High Courts to
the evidence and matters taking into
exercise judicial superintendence over the
materials account the policy
decisions of Administrative Tribunals
produced before and expediency.
within their respective jurisdictions is part
the court.
of the basic structure of the Constitution.
5 It is bound by It is not obligatory
viii. The Administrative Tribunals have to act
precedents, the to follow
as the only Courts of first instance in
principle of res precedents and

40
 judicata and the principle of res the agreement. E.g.: Clubs, Trade Unions,
principle of judicata but the Societies etc.
natural justice. principle of Differences between 'Statutory Domestic
natural justice Tribunals' and 'Non-Statutory Domestic
must be followed. Tribunals':
6 A court is vested It is vested with Statutory 'Non-Statutory
Sr.
Domestic Domestic
with jurisdiction limited No.
Tribunals Tribunals'
over all matters, jurisdiction to 1 These Tribunals These Tribunals
civil and criminal. decide cases only. are conferred force are conferred
7 It can decide the It cannot decide of law directly. Force of law
validity of the validity of indirectly.
legislation. legislation. 2 The aggrieved can Such writs cannot
8 Court has to It need not follow invoke consti- be availed against
follow the the procedural tutional remedy these tribunals.
procedural laws laws. viz. Writ of
viz. C.P.C, Cr.P.C, mandamus,
Law of Evidence Certiorari,
etc prohibition etc.
Domestic Tribunals 3 These tribunals These tribunals
Domestic Tribunals means "an agency resolve/solve the resolve/solve the
created to regulate the internal discipline problems/disputes problems/disputes
among the members by exercising the between the between the
adjudicatory and investigating powers". members and also members only.
Domestic Tribunals are sub-divided into: between the
i. Statutory Domestic Tribunals; and members and third
ii. Non-Statutory or Contractual Domestic persons.
Tribunals. 4 The decisions of The decisions of
Statutory Domestic Tribunal means 'the the statutory the nonstatutory
domestic tribunal created by or under a domestic tribunals domestic tribunals
statute'. E.g.: Bar Council of India and State are subject to are not subject to
Bar councils created under the Advocates Act, judicial review. judicial review.
1961. Similarly, Medical Councils created
under the Medical Council Act, 1956. While THE ADMINISTRATIVE TRIBUNALS
the Contractual Domestic Tribunal is created ACT, 1985
by an agreement between the parties and In pursuance of the provisions in Article
exercises jurisdiction and powers arising out of 323A, Parliament passed the Administrative

41
Tribunal Act, 1985, providing for all the territory of India or under the control of
matters falling within the clause(1) of Article the Government of India or any
323-A. corporation or society owned or
According to this Act, there must be a controlled by the Government in
Central Administrative Tribunal (CAT) at the pursuance of Article 323-A of the
centre and a State Administrative Tribunal Constitution and for matters connected
(SAT) at the state level for every state. therewith or incidental thereto.'
The tribunal is competent to declare the 3. Chapter-l contains three sections. Sec. 1
constitutionality of the relevant laws and says about the short title, extent and
statutes. The Act extends to, in so far as it is commencement. Sec.2 provides that the
related to the Central Administrative Tribunal, Act does not apply to naval, military or
to the whole of India and in relation to the air force etc. Sec.3 gives the definitions
Administrative tribunals for states. viz. Administrative Tribunal, application,
Objective for the establishment of Chairman, member, notification, post,
Administrative Tribunals rules, services etc.
The main purpose of the introduction of 4. Service Matters: The Administrative
this act was : Tribunals are established to solve the
1. To relieve congestion in courts or to service matters. Section 3(q) clearly
lower the burden of cases in courts. defines what are the service matters.
2. To provide for speedier disposal of Sec.3(q):- 'Service matters' in relation
disputes relating to the service matters. to a person, mean all matters relating to the
Salient Features of the Administrative conditions of his in connection with the affairs
Tribunals Act, 1985: of the Union or of any State or of any local or
1. The Administrative Tribunals Act, 1985 other authority within the territory of India or
(Act [Link] of 1985) has 37 Sections. under the control of the Government of India,
These 37 Sections are arranged in 5 or, as the case may be, of any corporation or
Chapters. society owned or controlled by the
2. Objectives: The Preamble of Act 13 of Government, as respects -
1985 provides the objectives of the Act as i. Remuneration (including allowances),
follows: 'An Act to provide for the pension and other retirement benefits;
adjudication or trial by Administrative ii. Tenure including conformation, seniority,
Tribunals of disputes and complaints with promotion,
respect to recruitment and conditions of iii. reversion, premature retirement and
service of persons appointed to public superannuation;
services and posts in connection with the iv. Leave of any kind;
affairs of the Union or of any State or of v. Disciplinary matters; or
any local or other authority within the vi. Any other matters whatsoever.

42
 Sec.3(r):- 'Service rules' as to redressal stay or any other manner as it thinks fit.
of grievances in relation to any matter, mean (Sec.24).
the rules, regulations, orders or other 13. The decision of the Tribunal is given by
instruments or arrangements as in force for the majority (Sec.25).
time being with respect to redressal, otherwise Advantages of Administrative Tribunals
than under this Act of any grievances in The concept of administrative
relation to such matters. tribunals was introduced because it has certain
5. Chapter-II deals with establishment of advantages over ordinary courts. Few of them
Tribunals and Benches thereof from are mentioned below
Sections 4 to 13. (1) Flexibility: The introduction of
6. Chapter-III contains from Sections 14 to administrative tribunals engendered
18, deals with jurisdiction, powers and flexibility and versatility in the judicial
authority of Tribunals. system of India. Unlike the procedures of
7. Chapter-IV containing from Sections 19 the ordinary court which are stringent and
to 27, deals with procedure. inflexible, the administrative tribunals
8. Chapter-V containing from Sections 28 to have a quite informal and easy-going
37, deals with miscellaneous provisions. procedure.
9. Section 19 empowers the aggrieved (2) Speedy Justice: The core objective of the
person to apply by an application along administrative tribunal is to deliver quick
with documents before the Administrative and quality justice. Since the procedure
Tribunal. The acceptance of application here is not so complex, so, it is easy to
depends upon the discretion of Tribunal. decide the matters quickly and efficiently.
Application shall have to be submitted (3) Less Expensive: The Administrative
after all other remedies have been Tribunals take less time to solve the cases
exhausted. The Limitation Act applies to as compared to the ordinary courts. As a
the Tribunal (Section 21). result, the expenses are reduced. On the
10. Section 22 empowers the Tribunal other hand, the ordinary courts have
exempts from the Rules of C.P.C. and cumbrous and slow-going, thus, making
Evidence, but at the same time, it imposes the litigation costly. Therefore, the
restriction to follow the principles of administrative tribunals are cheaper than
natural justice. ordinary courts.
11. The applicant has a right to appoint a (4) Quality Justice: If we consider the present
legal practitioner on behalf of him scenario, the administrative tribunals are
(Sec.23). the best and the most effective method of
12. The Tribunal has power to pass any providing adequate and quality justice in
interim orders, by way of injunction or less time. Relief to Courts: The system of
administrative adjudication has lowered

43
 down the burden of the cases on the (5) Absence of legal expertise: It is not
ordinary courts. necessary that the members of the
Drawbacks of Administrative Tribunals administrative tribunals must belong to a
Although, administrative tribunals legal background. They may be the
play a very crucial role in the welfare of experts of different fields but not
modern society, yet it has some defects in it. essentially trained in judicial work.
Some of the criticisms of the administrative Therefore, they may lack the required
tribunal are discussed below legal expertise which is an indispensable
(1) Against the Rule of Law: It can be part of resolving disputes.
observed that the establishment of the Merging of Tribunals
administrative tribunals has repudiated The Finance Act of 2017 merged eight
the concept of rule of law. Rule of law tribunals according to functional similarity.
was propounded to promote equality The list of the tribunals that have been
before the law and supremacy of ordinary merged are given below:
law over the arbitrary functioning of the a. The Employees Provident Fund
government. The administrative tribunals Appellate Tribunal with The Industrial
somewhere restrict the ambit of the rule Tribunal.
of law by providing separate laws and b. The Copyright Board with The
procedures for certain matters. Intellectual Property Appellate Board .
(2) Lack of specified procedure: The c. The Railways Rates Tribunal with The
administrative adjudicatory bodies do not Railways Claims Tribunal.
have any rigid set of rules and procedures. d. The Appellate Tribunal for Foreign
Thus, there is a chance of violation of the Exchange with The Appellate Tribunal
principle of natural justice. (Smugglers and Foreign Exchange
(3) No prediction of future decisions: Since Manipulators (Forfeiture of Property)
the administrative tribunals do not follow Act, 1976.
precedents, it is not possible to predict e. The National Highways
future decisions. Tribunal with The Airport Appellate
(4) Scope of Arbitrariness: The civil and Tribunal.
criminal courts work on a uniform code of f. The Cyber Appellate Tribunal and The
procedure as prescribed under C.P.C and Airports Economic Regulatory
Cr.P.C respectively. But the Authority Appellate Tribunal with The
administrative tribunals have no such Settlement and Appellate Tribunal
stringent procedure. They are allowed to (TDSAT) .
make their own procedure which may g. The Competition Appellate
lead to arbitrariness in the functioning of Tribunal with the National Company
these tribunals. Law Appellate Tribunal.

44
 Thus in the present scenario, the 2) The Administrative Tribunals Act, 1985
administration has become an important part has been amended by the Administrative
of the government as well as the citizen’s life. Tribunals Act, 1986 in which the phrase
Due to this increasing role, it is important to 'Article 136' has been omitted. It means,
establish a competent authority for the now the Supreme Court has appellate
redressal of people’s grievances and jurisdiction under Articles 32 and 136. By
adjudication of the disputes. Therefore, the the deletion of the reference to Article
concept of administrative tribunals was 136 in Sections 14, 15 and 28 of the
emerged and is dynamically flourishing in Administrative Tribunal Act it is made
India holding certain flaws and strengths. clear beyond doubt that the Supreme
Court's power under Article 32 of the
II. JUDICIAL REVIEW AGAINST Constitution remain unaffected. The
DECISIONS OF ADMINISTRATIVE Supreme Court has to decide whether or
TRIBUNALS not even in service litigation involving
1) Section 28 provides for the exclusion with alleged violations of Fundamental Rights
regard to the matters mentioned within has occurred or not.
the jurisdiction of Tribunal from all 3) Jurisdiction of the High Courts under
Courts, except that of the Supreme Court Articles 226 and 227 has also been taken
under Article 136 of the Constitution. away by Sections 14, 15 and 28 of the
Therefore, the High Courts have no Administrative Tribunals Act. Some of
jurisdiction to interfere with the judgment the jurists opine that the exclusion of the
of the Tribunal. Article 136 empowers the jurisdiction of the High Courts from the
Supreme Court, which may in its Administrative Tribunals is unjustified.
discretion, grant special leave to appeal The Andhra Pradesh High Court, in
from any judgment, decree, September 1993 interfered with the
determination, sentence, or order in any decision of the Andhra Pradesh
cause or matter passed or made by any Administrative Tribunal. In recent cases,
court or tribunal in the territory of India. the Supreme Court upheld that the High
Appellate power vested in the Supreme Courts should entertain jurisdiction over
Court under Article 136 is not an ordinary the decisions of redress is clearly,
appellate power. It is plenary. The effectively, efficiently pointed out by the
Supreme Court has itself set the limit by statute (here the Administrative Tribunals
permitting invocation of this power in Act, 1985) and also the statute
very exceptional circumstances, viz. specifically mentions the jurisdiction of
When a question of law of general public the High Courts under Articles 226 and
importance arises or a decision shocks the 227 should be excluded. The jurisdiction
conscience of the Court. of the Tribunal is conferred by the

45
 statutory provisions for the purpose of In Vionet vs. Barrett 25 , Lord Esher
determining rights, problems of service M.R., has defined it as 'The natural sense of
matters enacted by Parliament, which is what is right and wrong'. Later, he had chosen
the supreme legislative body in the to define natural justice as 'fundamental
country. justice' in a subsequent case Hopkins vs.
26
Smethwick Local Board of Health Lord
III. THE PRINCIPLES OF NATURAL Parker has defined it as 'duty act fairly'. Mr.
JUSTICE Justice Bhagwati has taken it as 'fair play in
The principles of Natural Justice, namely: action'. Articles 14 and 21 of the Indian
1. Rule against bias Constitution have strengthened the concept of
a) Pecuniary Bias; natural justice.
b) Personal Bias; Basis of the application of the principles of
c) Subject matter Bias. natural justice
2. Audi Alterem Partem The principles of natural justice,
a) Notice. originated from common law in England are
b) Fair-hearing. based on two Latin maxims, (which were
'Natural Justice' is an expression of drawn from 'jus naturale'). In simple words,
English common law, and involves a English law recognizes two principles of
procedural requirement of fairness.' The Natural Justice as stated below:
principles of natural justice have great 1. Nemo Judex in causa sua or Nemo debet
significance in the study of Administrative esse judex in propria causa or rule against
Law. It is also known as 'substantial justice or bias (no man shall be a judge in his own
fundamental justice or universal justice or fair cause)
play in action'. The principles of natural justice 2. Audi Alteram Partem or the Rule of Fair
are not embodied rules and are not codified. Hearing (Hearing the other side). '
They are judge made rules and are regarded as I. Rule against bias 'or' bias of interest
counterpart of the American procedural due The term bias means 'anything which
process. tends to or may be regarded as tending to
Definition cause such a person to decide a case otherwise
There is no precise and scientific than on evidence must be held to be biased'. In
definition of 'Natural Justice'. However, the simple words, bias means 'deciding a case
principles of natural justice are being accepted otherwise than on the principles of evidence'.
and enforced. Different judges, lawyers and This principle is based on the following
scholars defined it in various ways. rules/principles.

25
. (1885) 55 LJ RB 39
26
. (1890) 24 QB 713)

46
i. No one should be a judge in his own ground that the College had a pecuniary
cause. interest. (Fine against Dr. Benham was
ii. Justice should not only be done, but dismissed).
manifestly and undoubtedly be' seen to be The rule of pecuniary bias was laid
done; and down in the case of: Dimes vs. D.J. Canal28 -
iii. Judges like Ceaser's wife should be above A company filed a suit against a landowner.
suspicion. Lord Chancellor (Judge), who was a
The above principles make it clear that shareholder of the Plaintiff Company heard the
judiciary must be free from bias and should case and decided in favor of the company. On
deliver pure and impartial justice. Judges must appeal, the House of Lords quashed this
act judicially and decide the case without decision on the ground that 'no man shall be
considering anything other than the principles judge of his own cause'.
of evidence. R. VS. Hendon Rural District Council,
Kinds/Types of Bias Ex parte Charley 29 - In this case, one of the
The rule against bias may be classified members of the Planning Commission was an
under the following three heads: estate agent and he was acting for the applicant
1) Pecuniary Bias; to whom permission was granted by the
2) Personal Bias; and Planning Commission. The decision of the
3) Bias as to subject matter. Planning Commission granting the permission
(1) Pecuniary Bias was quashed on the ground of pecuniary bias.
Pecuniary bias arises, when the Jeejeebhoy vs. Asst. Collector30, in this case, it
adjudicator/judge has monetary/economic was found that one of the members of the
interest in the subject matter of the Bench of the court was also a member of the
dispute/case. The judge, while deciding a case co-operative society for which the disputed
should not have any pecuniary or economic land had been acquired. The Bench was
interest. In other words, pecuniary interest in reconstituted. Similarly in Visakhapatnam Co-
the subject matter of litigation disqualifies a operative Motor Transport Ltd. vs . [Link]
person from acting as a judge. Relevant Raju31 , in this case, the District Collector as
leading case on this point is Dr. Benham's the Chairman of the Regional Transport
Case27 Dr. Benham was fined for practicing in Authority granted motor permit to the above
the city of London without license of the co-operative Society, to which he was also the
College of Physicians. According to the president. The Court set aside the Collector's
statute, the college is entitled to half of the action on the ground of pecuniary bias.
amount, and the remaining goes to the King.
Coke CJ. Dis-allowed the claim (fine) on the 28
. (1852) 3 HLC 579
29
. (1933) 2 KB 606
30
. AIR 1965 SC 455
27 31
. 8 Co. Rep. 107 77 Eng. Rep. 638 . AIR 1953 Mad 212

47
(2) Personal Bias of the company had opposed the Minister and
Personal bias arises from l1ear and filed a criminal case under Section 500 of the
dear i.e. from friendship, relationship, business Indian Penal Code. The case was political
or professional association. Such relationship rivalry between the minister and Raja
disqualifies a person from acting as a judge. Kamakshya Narain Singh. The cancellation
Relevant Case on this point is: A. K. Kripak order was set aside on the ground of personal
32
vs. Union of India , the Supreme Court bias.
quashed the selections made by the Selection Kirti Deshmankar vs. Union of India 36,
Board on the ground that one of the candidates in this case, the mother-in-law of a student
appeared before selection committee was also selected for the admission to the Medical
a member of the Selection Board. College was vitally interested in her
Meenglass Tea Estate vs. Their admission. The mother-in-law was a member
Workmen, 33 in this case, the Manager of the of the college and Hospital Council and she
factory conducted inquiry against the participated in the meeting of the Council. On
workmen who were alleged to have assaulted this ground the court held that the selection of
him. The court disqualified the Manager on the the student for the admission to the Medical
ground of personal bias. College was vitiated. The Court made it clear
State of U.P. vs. Mohd. Nooh34, in this that it was not necessary to establish bias.
case a departmental inquiry was held against Reasonable likelihood of bias was considered
an employee and one of the witnesses against sufficient to vitiate the selection for admission.
the employee turned hostile. The Inquiry In short, for vitiating the decision on the
Officer, then left the inquiry and gave ground of bias, it is not necessary to establish
evidence against him and thereafter resumed to bias. It is sufficient to invalidate the decision if
complete the inquiry and passed the order of it can be shown that there has been reasonable
dismissal. The order of dismissal was quashed likelihood of bias.
on the ground of personal bias. (3) Bias as to subject matter (Official Bias)
Mineral Development Ltd. vs. State of Any interest or prejudice will
Bihar 35, in this case, the Petitioner Company disqualify a judge from hearing the case.
was owned by Raja Kamakshya Narain Singh. When the adjudicator or the judge has general
The petitioner was granted mining license for interest in the subject matter in dispute on
99 years. The license was cancelled by the account of his association with the
Minister of Revenue acting under Bihar Mica administration or private body, he will be
Act. Raja Kamakshya Narain Singh, the owner disqualified on the ground of bias if he has
intimately identified himself with the issues in
32
. AIR 1970 SC 150
dispute. To disqualify on the ground there
33
. AIR 1963 SC 1719
34
. AIR 1958 SC 86
35 36
. AIR 1960 SC 468 . (1991) 1 SCC 104

48
must be intimate and direct connection Lavanya vs. Osmania University, 39 in
between the adjudicator and the issues in this case Lavanya wrote [Link]. (Maths)
dispute. examinations of Osmania University in 1999.
Now the question is, whether this In the result, it was intimated that she failed in
principle can be extended to administrative Maths. She applied for re-valuation. In re-
adjudication also. If so, no decision will be valuation she passed. She appeared for M.B.A.
free from bias. Entrance Examination in 1999 and qualified
Gullampally Nageswara Rao vs. for admission. However, Osmania University
APSRRTC 37 , in this case, the Government authorities refused to admit her rejecting her
proposed nationalization of motor transport. application that she passed in re-va1uation.
Objections for nationalization were referred to She sought directions from the A.P. High
be heard by the Secretary to the Government, Court.
who upheld the validity of the scheme (for The Andhra Pradesh High Court gave
nationalization). It was challenged on the judgment on 13-10-1999 in favour of Lavanya
ground that the said Secretary in fact, initiated and ordered the Osmania University
the nationalization. The Supreme Court held authorities to admit her.
the Government Secretary's action invalid. Exception to the rule against bias or the
K. Chelliah vs. Chairman, Industrial Doctrine of Necessity
38
Finance Corporation , in this case the When bias is provided, it disqualifies
disciplinary action against an employee was the adjudicator and an impartial adjudicator
taken by the Chairman of the Corporation. should replace him. However, there are certain
There was statutory provision for the appeal extreme cases in which
from the Chairman to the Board of Directors. substitution/replacement of impartial
The Chairman was also a member of the Board adjudicator is not possible. In such situations,
of Directors. The Chairman participated in the the principles of natural justice, under
meeting of the Board in which the appeal was necessity has to give way. Otherwise the
considered. administration of justice breaks down and
The order of the Board was quashed there is no other means to decide. Though
on the ground of bias. The presence of the Indian Courts have not expressly adopted it,
Chairman in the meeting of the Board in which this doctrine (of necessity) has been impliedly
the appeal was considered created a reasonable applied in several occasions. In contempt of
apprehension in the mind of the party that court, the rule that no one shall be a judge in
there was real likelihood of bias. his own cause is not followed strictly.
Similarly, in departmental enquiry in service
matters, the employer appoints enquiry officer

37
. AIR 1959 SC 308 : (1959) Supp. (1) SCR 319
38 39
. AIR 1973 Mad. 122 . (1999) A.P 209

49
and there is every possibility that the enquiry Punjab National Bank vs. All India
officer acts in favour of the employer. Bank Employees' Federation 40 , in this case,
II. Audi alteram partem 'or' the rule of fair notice did not contain the charges against
hearing (Hear the other side) which fine was imposed.
Meaning The Supreme Court held the notice defective
The second fundamental principle of and quashed the fine. Similarly in R. V.
natural justice is 'Audi Alteram Partem' or 'The University of Cambridge41 (Dr. Bentley's case)
Rule of Pair Hearing'. It means, "no one shall - In this case, the University authorities J
be condemned unheard" i.e. there must be without- giving any notice cancelled the
fairness on the part of the deciding authority. degree of Dr. Bentley on the ground of
According to this principle, reasonable misconduct. The University' action was held
opportunity must be given to a person before violative of the principle of natural justice.
taking any action against him. R. vs. Newmarket Assessment
This rule insists that the affected Committee 42 in this case the Municipality
person must be given an opportunity to issued a notice to the house owner stating that
produce evidence in support of his case. He it was going to tax the house @ 2,5001 pounds
should be disclosed the evidence to be utilized per year, and also stated that if the owner
against him and should be given an consented to it, he need not attend before
opportunity to rebut the evidence produced by 'Assessment Committee'. The house owner did
the other party. not attend. Later the municipal committee
Essentials of Fair Hearing enhanced the tax to @ 4,500 pounds without
To constitute fair hearing, the giving any notice.
following ingredients are to be satisfied: The House of Lords quashed the
1) Notice; and municipal assessment order in the Writ of
2) Hearing. Certiorari. The object of the notice is to
(1) Notice provide an opportunity to the person so that he
There is a duty on the part of the can equip himself to defend his case. Any
deciding authority to give notice to a person order passed without giving a notice is against
before taking any action against him. The the principles of natural justice and is void ab
notice must be reasonable and must contain initio.
the time, place, nature of hearing and other Board. of High School vs. Kumari
particulars. If the notice is defective or vague, Chitra, 43 in this case, the petitioner appeared
all subsequent proceedings "'would be vitiated. for the examination. But the Board, without
Relevant case on this point is:
40
. AIR 1960 SC 16
41
. (1723) 1 Str. 757
42
. 1945 All ER
43
. AIR 1970 SC 1039

50
giving a notice cancelled the examination on Meaning Fair hearing in its full sense
the ground of the shortage of attendance. The means that a person against whom an order to
petitioner was not given an opportunity of his prejudice is passed should be informed of
being heard. The Board contended that giving the charges against him, be given an
show cause notice would not serve the purpose opportunity to submit his explanation thereto,
since the evidence (shortage of attendance) is have a right to know the evidence both oral
borne on the record. The Supreme Court and documentary, by which the matter is
rejected the contention of the Board and held proposed to be decided and to have the
the action violative of the principles of natural witnesses examined in his presence and have
justice. The principles of natural justice must the right to cross examine them and to lead his
be observed irrespective of the reason, whether own evidence both oral and documentary in
the purpose would be served or not. his defence. It is a code of procedure, which
Maneka Gandhi vs. Union of India44, has no definite content, but varies with the
this is a leading case in personal1iberty under facts and circumstances of the case.
Article 21 of the Indian Constitution. The Ingredients of Fair Hearing
petitioner, Maneka Gandhi's passport was A hearing will be treated as fair-hearing if
impounded without giving any opportunity (by the following conditions are satisfied:
the Government of India) in public interest. 1. Adjudicating authority receives all the
The Supreme Court held the order of the relevant material produced by the
Government violative of the principles of individual.
natural justice, and laid down the following 2. The adjudicating authority discloses the
propositions: individual concerned evidence or
1. The adjudicating authority (judge) must material, which it wishes to use against
be impartial and without any interest or him.
bias. 3. The adjudicating authority provides the
2. The adjudicating authority, whether person concerned an opportunity to rebut
judicial or quasi-judicial cannot delegate the evidence or m~erJa1, which the said
or sub-delegate its power (the power to authority wants to use against him.
decide the case should not be delegated). Cooper vs. Wandsworth Board of
3. The adjudicating authority must disclose Works 45 , in this case Wandsworth Board of
all the material placed before it and must Works was a statutory municipal authority. It
give reasonable opportunity to the had powers to demolish any structure, if it was
affected interest to submit their case. constructed in breach of the statutory
(2) Hearing: conditions. The plaintiff had proceeded with
the erection of a house without consulting the

44 45
. AIR 1978 SC 597 . (1863) 14 CBNS 180

51
Board as required. The Board in turn Section 191 (4) of The Municipal Corporations
demolished the plaintiff's house on the basis Act, 1882. No specific charges were
that he had built it unlawfully. The plaintiff mentioned in the dismissal order. Ridge
brought this action for trespass on the basis represented the Committee by a solicitor. He
that he had been given no warning as to the was not reinstated. He appealed to the Home
action the Board would take. Secretary, who dismissed the appeal. Finally,
The Home of Lords held that the Board had Ridge appealed to the House of Lords.
acted unlawfully in demolishing the house The House of Lords allowed the
without first giving the plaintiff an opportunity appeal of Ridge, and opined that the
to be heard. Committee should have informed him of the
Spackman VS. Plumstead Board of charges against him, and given him a proper
Works, 46 in this case Plumstead Board of opportunity to be heard, which had not been
Works was a statutory Body, and it was a done.
superintendent architect fixing the 'general line IV. ADMINISTRATIVE
of buildings' along with the road violation of DISCRETION AND ITS REVIEW -
the rules were liable to be prosecuted. The JUDICIAL CONTROL
petitioner constructed his house encroaching
The fundamental principle of rule of
some little area of roadside margin area by
law is all authorities and their actions are
oversight. The Board demolished the building
subject to law. The administrative authorities
without giving any notice, and also prosecuted
is discharging their duties may act beyond the
him.
power (ultra vires) or abuse the power
The Court held that both these acts of
conferred on them. As a result, individual
the Board were unconstitutional and violative
rights and liberties/freedoms may be affected.
of the principles of natural justice.
Therefore, it is necessary that there should be
Ridge vs. Baldwin 47 in this case Mr.
judicial control/review over misuse of
Ridge was the Chief Constable of Brighton
discretionary power of the administrative
during 1957-58. During his tenure, there were
authorities so that the rights of the people are
several complaints and criticisms about his
not adversely affected.
corruption. Trials were commenced against
SC Advocates-on-Record Association
him by the local Watch Committee. He was
vs. Union of India 48 The Supreme Court has
suspended during the trials. In the trials, no
made it clear that there has to be room for
convictions were recorded against him. Even
discretionary authority within the operation of
after completion of trials, he was not reinstated
the rule of law, even though it has to be
into service. The Watch Committee dismissed
reduced to the minimum extent necessary for
Ridge from the service in March 1958 under
proper governance. Within the area of
46
. 1885 QB All ER
47 48
. 1964 AC 40 . (1933) 4 SCC 441

52
discretionary authority, the existence of proper insecurity for legal freedom on the part of its
guidelines or norms of general application subject'.
excludes any arbitrary exercise of Types of Discretion
discretionary authority. Several methods of Basing on the type of satisfaction,
control of administrative discretion have been administrative discretion may be classified
developed e.g. Doctrine of natural justice and into -
fairness, excessive delegation, ultra vires etc. i. Subjective Satisfaction Type; and
Administrative Discretion -Meaning and ii. Objective Satisfaction Type.
Definition (1) Subjective Satisfaction Type
Meaning Where the statute empowers the
The word 'discretion' implies power to administrative authority to set its own limits to
make a choice between alternative courses of determine the criteria for a decision, such type
action. According to Coke, discretion is a of discretion is called subjective satisfaction
science or understanding to discern between type. The expressions like 'if in his opinion', 'if
falsity and truth, between right and wrong and he thinks fit', 'if he deems', 'if he considers' etc.
not do according to will and private affection. are the good examples of the subjective
In the words of Mr. Justice Frankfurter, satisfaction type of discretion.
'Discretion without a criterion of its exercise is (2) Objective Satisfaction Type
authorisation of arbitrariness'. When the statute which empowers the
Definition executive with discretionary power itself
Professor Freund: Administrative Powers imposes defined or ascertainable
over Persons and Property, 1928. predetermined criteria, with the help of which
"When we speak of administrative the decision maker must make his choice, it is
discretion, we mean that a determination may called objective satisfaction type of discretion.
be reached, in part at least, upon the basis of The existence of the objective element may be
consideration not entirely susceptible of proof viewed as condition precedent for the exercise
or disproof. or the power e.g.: Section 237(b) of the
It may be practically convenient to say Companies Act, 1956 empowers the Company
that discretion includes the case in which the Law Board to appoint Inspectors on its own
ascertainment of fact is legitimately left to motion, if there are circumstances suggesting
administrative determination'. the following.
Dicey i. Fraud, oppression, or illegality;
'Wherever there is discretion, there is room for ii. Fraud, misfeasance or misconduct;
arbitrariness and that in a republic no less than iii. Inadequate information.
under a monarchy discretionary authority on Here discretion of the Company Law
the part of the government must meant Board to appoint Inspectors can be exercised

53
only objectively when anyone of the above There are different Kinds of judicial
conditions is satisfied. Review over administrative discretion as
Judicial Control or Review over detailed below
Administrative Discretion DIFFERENT KINDS OF JUDICIAL
The general rule is that courts should REVIEW OVER ADMINISTRATIVE
not interfere with the actions taken in exercise DISCRETION
of discretionary powers by the administrative (A) Failure to Exercise Discretion
authorities. While disposing the case 1) Sub-delegation;
'Westminster Corporation VS. London & 2) Imposing fetters on discretion by self--
49
North Western Rly. Co. expressed as imposed rules of policy;
follows: 'Where the Legislature has conferred 3) Acting under dictation; and
the power to a particular body, with a 4) Non-application of mind.
discretion how it is to be used, it is beyond the (B) Excess or abuse of discretion
power of any court to contest that discretion. ' 1) Exceeding jurisdiction;
The Supreme Court of India also 2) Irrelevant considerations;
expressed the similar views in a number of 3) Leaving out relevant considerations;
cases, viz. Gopalan vs. State of Madras 50 , 4) Mixed considerations;
Lakshanpal vs. Union of India51 etc. 5) Mala fides;
However, unfettered and vast 6) Improper purpose or Collateral
discretionary powers on the administrative Purpose;
authorities leads to mal-administration, 7) Colorable exercise of power;
corruption, suppression and atrocities. 8) Violation or principles of natural
Therefore, there should be judicial justice; and
control/review over the decisions given in 9) Unreasonableness
exercise of discretionary powers by the (C) Violation of fundamental rights
administrative authorities. (D) Ultra Vires
Kinds of Judicial Review There are different valid and
Indian Constitution provides for reasonable grounds, on which the courts can
judicial review. Articles 32 and 226 of the interfere with the administrative discretion.
Constitution confer on the Supreme Court and Mainly there are three grounds. They are:
High Courts respectively the power of judicial 1. Failure to exercise discretion;
review to examine the constitutional validity 2. Excess or Abuse of Discretion; and
of a law passed by the Parliament or State 3. Infringement or Violation of Fundamental
Legislature. Rights.
(A) Failure to Exercise Discretion
49
. (1905) A. C. 426 The parent Act confers certain powers
50
. AIR 1950 SC 27
51
. AIR 1967 SC 908 on the administrative authority. Such authority

54
should exercise such powers within the limits and non-application of mind, then he comes
and bounds mentioned in the parent Act. If he under failure to exercise discretionary powers.
fails to exercise discretionary powers, then the It is bad in law.
courts can interfere. Generally, there are four (B) Violation of Fundamental Rights
circumstances in which failure to exercise - When discretionary power is conferred
discretion arises. on an administrative authority, it should be
Those circumstances are exercised according to law. Otherwise, it
1. Sub-delegation; amounts to abuse of power. It is inferred under
2. Imposing fetters on discretion by self- the following circumstances:
imposed rules of policy a) Exceeding jurisdiction;
3. Acting under dictation; and b) Irrelevant considerations;
4. Non-application of mind c) Leaving out relevant considerations;
(1) Sub-delegation d) Mixed considerations;
'Ddegatus non potest delegare'. A e) Mala fide;
delegate cannot delegate. A person to whom f) Improper purpose or Collateral purpose;
powers have been delegated cannot delegate g) Colorable exercise of power;
them to another. h) Violation of principles of natural justice;
(2) Imposing fetters on discretion by self- i) Unreasonableness.
imposed rules of policy (1) Exceeding jurisdiction
The authority has discretion on certain An administrative authority is required
general policy. But he imposes fetters on to exercise discretionary power within the
policy to be applied by it rigidly to all cases limits of the statute. An action or decision
coming before him for decision. going beyond what is authorized by law is
(3) Acting under dictation ultra vires. For example, if the administrative
The parent Act delegated certain authority is empowered to control the price of
powers upon certain administrative authority. bread it will be in excess of its jurisdiction to
He himself should perform such action. If he control the price of butter. The entire order
seeks the instructions from any other person, will be ultra vires and void for exceeding
or from his superior person, it becomes bad in jurisdiction.
law. It is known as acting under dictation. Calcutta Electricity Supply
52
(4) Non-application of mind Corporation vs. Workers Union , in this case,
Where the discretionary powers are vested it was held that, if an authority is empowered
in the executive, he must apply it with highest to award a claim for the medical aid of
care, diligence, caution and responsibility. He employees, it will be exceeding in its
should not act mere mechanically. He should
apply his own mind according to the
circumstances. If he performs without due care 52
. AIR 1959 SC 1191

55
jurisdiction in granting the said benefit to the In Rampur Distillery vs. Company
family members of the employees Law Board 54 in this case the Company Law
(2) Irrelevant considerations Board refused to give its approval for
A discretionary power conferred on an renewing the managing agency of the
administrative authority by a statute must be company on the ground that Justice Vivin
exercised on relevant and not on irrelevant or Bose Commission had severely criticised the
extraneous considerations. It means that the past dealings of the Managing Director Mr.
power must be exercised on considerations Dalmia. The Court conceded that the past
relevant to the purpose for which it is conduct of the Directors was a relevant
conferred. If the authority takes into account consideration but pointed out that the Board
wholly irrelevant or extraneous circumstances, has failed to take into account their present
the exercise of power by the authority will be conduct, which is more relevant to consider
ultra vires and the action bad. the application of renewal of managing
Thus, in Ram Manohar Lohia vs. State agency.
53
of Bihar in this case under the Defence of (4) Mixed considerations
India Rules, the authority was empowered to Sometimes, it so happens that the
detain a person to prevent subversion of order is not wholly based on irrelevant or
'public order'. The petitioner was detained with extraneous considerations. It is founded partly
the view to prevent him from acting in a on relevant and existing considerations and
manner prejudicial to the maintenance of 'law partly on irrelevant or non-existent
and order'. The Court set aside order of considerations. Judicial pronouncements do
detention. In the opinion of the concept of 'law not depict a uniform approach on this point.
and order' was wider than the concept of In Dhiraj Lal vs. Commr. of Income
55
'public order'. Tax , there was a question before the
(3) Leaving out relevant considerations Supreme Court whether the applicant was
While exercising the discretionary liable to assessment or not. The tribunal
power the administrative authority is expected relying on relevant as well as irrelevant
to take all the relevant factors into materials held the appellant liable. The Court
consideration. Failure to do so will render the quashed the order of assessment because of the
decision invalid. It is very difficult to prove use of inadmissible material.
that certain relevant factors were not taken into In Shibban Lal vs, State of U.P. 56 in
consideration by the authority, unless detailed this case the petitioner was detained on two
reasons are given in the impugned order, from grounds. Later the government revoked an
which it can be inferred. order of detention on one of the grounds but

54
. AIR 1970 SC 1978
55
. AIR 1955 SC 271
53 56
. AIR 1966 SC 740 . AIR 1954 SC 179

56
continued detention on the other ground. The manner prejudicial to the maintenance of
Court quashed the final detention order. supplies and services essential to the life of the
(5) Mala fide community. The petitioner challenged the
The expression 'mala fide' means detention alleging mala fide against the D.S.P.
"dishonest intention or bad faith or corrupt (civil supplies [Link]) that he had made false
motive." When the exercise of discretion is reports against the petitioner so that he would
tainted with mala fide the decision is bad and be eliminated as a wholesale kerosene dealer
it is liable to be set aside. The person alleging and a relative of the D.S.P. might benefit by
mala fide must prove it, and proving it against obtaining the distributorship for kerosene. No
the mighty administration is a very difficult affidavit was filed by the D.S.P. denying the
task. allegations made against him and the affidavit
In Pratap Singh vs. State of Punjab 57, filed by the Home Secretary was very vague
in this case the petitioner was a civil surgeon and defective in many material respects. The
and he had taken leave preparatory to Court concluded that the detention was tainted
retirement. Initially the leave was granted but with mala fide and the order was quashed by
subsequently it was revoked, and a issuing a writ of certiorari.
departmental enquiry was ordered against him In Rowjee vs. State of A.P. 59 in this
and he was placed under suspension. The case the State Road Transport Corporation had
enquiry was instituted against him on the framed a scheme for nationalization of certain
charge of receiving Rs.16 from a patient in an bus routes in western parts of the Kurnool
illegal manner during the period he was District. This was done as per directions of the
working as a civil surgeon and ultimately he Chief Minister. It was alleged by the petitioner
was removed from service. The petitioner that the particular routes were selected with
alleged that all these actions were instigated by mala fide to take vengeance against the private
the Chief Minister because he had refused to transport operators of that area as they were
yield to certain illegal demands of the Chief his political opponents. The Supreme Court
Minister and members of his family. Though upheld the contention and quashed the order.
there was no direct evidence proving mala (6) Improper purpose or Collateral purpose
fide, the Court has inferred mala fide from the If the statutory power conferred on the
circumstances of the case and quashed the administrative authority for a particular
order by issuing a writ of certiorari. purpose and if exercised for some other
In Sadanandan vs. State of Kerala58, in purpose, it is called 'abuse of discretion for
this case the petitioner, a kerosene dealer, was improper purpose' and the action may be
detained under the Defence of India Rules quashed. In the case of mala fide the action is
with a view to prevent him from acting in a tainted with personal ill will or malice, but it is

57
. AIR 1964 SC 72
58 59
. AIR 1966 SC 1925 . AIR 1962 SC 962

57
not so in the case of improper purpose. Even if reality for some other purpose, it is called
the action of an authority is motivated by colourable exercise of power. Colourable
public interest it is liable to be set aside if it exercise of power arises when the statute does
was exercised for a purpose not covered by the not prescribe the particular manner in which
statute. discretion must be exercised; and the authority
In Nalini vs. District Magistrate 60 , exercises the power under the colour or guise
under the relevant statute power was conferred of legality.
on the authority to rehabilitate persons It is very difficult to draw a dividing
displaced from Pakistan as a result of line between improper purpose and colourable
communal violence but it was exercised to exercise of power. Both are almost same and
accommodate a person who had come from the differences if any are only illusory. If the
Pakistan on a Medical Leave. The order was discretion is exercised for an improper
set aside. purpose, there is colourable exercise of power.
Similarly, in Ahmedabad Mfg. And Similarly, if there is colourable exercise of
Calico printing Co. vs. Municipal Corporation power there is improper purpose. It may be
Ahmedabad61, the relevant statute empowered submitted that the use of anyone of the phrase
the Commissioner to disapprove the improper purpose or colourable exercise may
construction of any building if it contravened be avoided.
any of the provisions of the statute. If the said (8) Violation of principles of natural justice
power is exercised to bring pressure on the If the administrative authority, while
company to provide drainage facility to its exercising its discretionary power, violates the
other existing buildings, the order cannot be principles of natural justice, the court can set
upheld. aside the order/decision of the administrative
In State of Bombay vs. K. P. authority.
Krishnan62, in this case the workmen resorted (9) Unreasonableness
to go slow during the year. On this ground, the The administrative authority must use its
government refused to make a reference. The discretionary power with utmost
Supreme Court held that the reason was not reasonableness. If it acts without
germane to the scope of the Act and quashed reasonableness, the court can set aside its
the order. orders and decision
(7) Colourable exercise of power (C) Infringement or Violation of
Where the discretionary power is Fundamental Rights
exercised by the authority ostensibly for the Part-III of the Indian Constitution
purpose for which. It was conferred, but in containing Articles 12 to 35 confers on
citizens certain Fundamental Rights. An
60
. AIR 1951 Ca1.346 administrative authority must exercise its
61
. AIR 1956 Bom.317
62
. AIR 1960 SC 1223

58
discretionary powers in consonance with those task. In such cases the limits of the discretion
rights must be ascertained first.
63
In West Bengal vs. Anwar Ali , in this In Gurbachan Singh vs. Bombay65, in
case the validity of the West Bengal Special this case the Bombay Police Act authorised
Courts Act, 1950 was challenged, which two kinds of externment: i) externment from
empowered the state government to refer any greater Bombay; and ii) externment from the
offence for trial by a Special Court. According State of Bombay. In the first kind the order of
to the preamble of that Act, the purpose of the externment must specify the place where
Act was speedier trial of certain offences. The (within the state) the externee was to remove
respondent was tried and convicted by the himself, whereas in the second type of cases
Special Court. He challenged the validity of the externee might stay anywhere outside the
the Act on the ground that it was violative of state. An externment order issued under the
Art. 14. The Supreme Court held the Act first kind asking the externee to leave Greater
invalid on the ground that it confers a wide Bombay and go to Amritsar was held ultra
discretion on the government as there was no vires the powers conferred.
yardstick for grouping either of the persons or
offences. Moreover the expression 'speedier
trial' was too vague, uncertain and indefinite
In Chandra Bhan Singh vs. Bihar64, in this
case the government acquired vast area of land
belonging to several persons but released lands
owned by a family by way of pure and simple
favouritism. The acquisition order was held
invalid on the ground of violation of Art. 14
(D) Ultra Vires
The expression 'Ultra vires' means "beyond
powers". The discretionary power conferred on
the administrative authority must be exercised
within the limits. If the administrative
authority in exercising the discretionary power
exceeds the limits, it is said to be ultra vires.
When the limits of the discretion are precisely
defined, it is easy to check the excess, but if
the discretion conferred is too wide, checking
it on the ground of ultra vires is a difficult

63 65
. AIR 1952 SC 75 . AIR 1952 SC 221, see also Ram Manohar
64
. AIR 1984 SC 1767 Lohia vs. State of Bihar, AIR 1966 SC 749

59
 Chapter - VII
JUDICIAL CONTROL OF ADMINISTRATIVE ACTION THROUGH WRITS AND
OTHER REMEDIES

A person whose right is infringed by Article 32 of the Indian Constitution is

an arbitrary administrative action approaches a fundamental right placed under Part-III of
the court for relief/remedy. Administrative the Constitution. Art.32 (i) confers a
Law provides for various kinds of remedies fundamental right to an individual to move the
and reliefs to the aggrieved against an illegal Supreme Court for the enforcement of
administrative action. These remedies are Fundamental Right. It (Art.32) also confers
classified as follows: power on the Supreme Court to issue various
I. CONSTITUTIONAL REMEDIES: 'writs viz. Hebeas Corpus, Mandamus,
1. Scope of Articles 32 & 226 of Indian Prohibition, Certiorari and Quo Warranto for
Constitution; enforcement of the Fundamental Rights.
2. Exhaustion of Remedies; Article 32 confers on the Supreme
3. Writs: Court wide (enormous) powers. Under Article
a) Hebeas Corpus; 32, the Supreme Court is empowered to relax
b) Mandamus; the traditional rule of Locus Standi and allow
c) Certiorari; the public interest litigation petitions at the
d) Prohibition; and instance of the public-spirited citizens. The
e) Quo Warranto. Supreme Court can provide relief to bonded
4. Special Leave to Appeal (Article 136 of labour, under trial prisoners, victims of police
the Constitution). torture etc. The Supreme Court awarded
II. CIVIL LAW REMEDIES: exemplary damages by exercising its power
1. Injunction; under Article 32 of the Constitution in the
2. Declaration; and following cases:
3. Damages. Bhim Singh vs. State of J & K,85 Bhim
Among the above, Articles 32 & 226; Writs Singh, an M.L.A. of J & K Assembly was
and Special Leave to Appeal (Art. 136) are awarded exemplary damages of Rs.50,000/- by
important from examination point of view. the Supreme Court for unlawful arrest.
Every student/citizen must know about them Rudul Sha vs. State of Bihar 86 , In
irrespective of their appearance in the Rudu1 Shaw's case, an acquitted person who
examination). was detained for more than 14 years was
I. CONSTITUTIONAL REMEDIES awarded exemplary damages ofRs.35,000/-
Scope of Articles 32 and 226
Article 32 85
. AIR 1986 SC 494
86
. AIR 1983 SC 1086

67
 Sebastian M. Hongray vs. Union of the Fundamental any other purpose.
87
India, similarly, in Sebastian's case, Rights.
exemplary damages of Rs.1,00,000/- each was 2 Jurisdiction of Judicial Review of
awarded to the wives of two persons, who the Supreme High Court with
were taken to military camp by the Jawans of Court under respect to
the army and the Government failed to ArU2 is part of Administrative
produce them before the Court. Basic structure. Tribunals and
Article 226 Special Courts
Article 226 of the Indian Constitution forms part of the
empowers the High Court to issue various Basic structure88
writs viz. Habeas Corpus, Mandamus etc. like 3 Article 32 itself Article 226 is not a
under Article 32 by the Supreme Court. It is a Fundamental Right.
(Art.226) also guarantees an individual to Fundamental
move the High Court for enforcement of the
fundamental rights, or for any other purpose. Exhaustion of Remedies
Article 226 confers wider power on the High Exhaustion of Remedies means when
Court. It serves as a big reservoir of judicial a statute provides any remedy or relief to an
power to control administration. Its power administrative error, the aggrieved person shall
under Art.226 cannot be curtailed by seek first such remedies as available. This is
legislation. Even if a statute declares an called exhaustion of remedies. E.g.: Motor
administrative action as final, still it can be Vehicles Act, 1939 (as amended in 1982 and
challenged under Art.226. Thus, the power 1988) provided the scheme for issue of permits
conferred on High Court under Art.226 is and also provided remedies for redressal.
wider, when compared to the power conferred Therefore, an aggrieved party shall
on Supreme Court under Art.32. first seek remedy available under the statute;
thereafter, he may resort to court by filing a
Distinction between 'Art.32' and 'Art.226' Writ. Writs are considered as extra-ordinary

Sr. remedies. Courts refuse to issue writ if

Article 32 Article 226
No. adequate remedy is available under the statute.
1 The right The right under
guaranteed Article 226 can be Writs
under Article 32 exercised for Articles 32 and 226 of the Indian
can be exercised enforcement of the Constitution confer writ jurisdiction on
only for Fundamental Supreme Court and High Courts respectively.
enforcement of Rights and also for Writ is an instrument or order of the court by

88
. The State Of Andhra Pradesh & Ors. vs K.
87
. AIR 1984 SC 1026 Mohanlal & Anr. 1998 (5) SCC 468

68
which the court (High Court or Supreme Bhim Singh vs. State of J & K, AIR 1986 SC
Court) directs an individual or official or an 494, the Court awarded the exemplary
authority to do an act or abstain from doing an damages ofRs.50,000/-.
act. Who can apply for the Writ of Habeas
Writs are classified under the Corpus (Locus Stadii)
following heads: The general rule is, the person who is
a) Writ of Habeas Corpus; detained can apply, for the writ. But, in certain
b) Writ of Mandamus; cases, the application can be made on his
c) Writ of Certiorari; behalf by his friends or relatives. However, a
d) Writ of Prohibition; and total stranger cannot make the petition for the
e) Writ of Quo Warranto. writ of Habeas Corpus.
a) Writ of Habeas Corpus Scope of the Writ of Habeas Corpus
Meaning It is the most effective and speedy
The expression 'Habeas Corpus' is a remedy in case of unlawful detention. The
Latin term. It means have (produce) the body. purpose of the writ is not to punish the
If a person is detained unlawfully, he or his wrongdoer, but to protect the personal liberty
relatives or friends can move the court by of the person detained. The burden of proof
filing an application under Article 226 in High (that he is under lawful detention) is on the
Court or under Article 32 in Supreme Court part of the respondent. As it protects the right
for the writ of Habeas Corpus. guaranteed under Article 21, it is called
The Court on being satisfied with the 'Freedom Writ'. It is a writ of right, not
contents therein issues the writ of Habeas discretionary like other writs.
Corpus. This writ is in the form of an order In Sunil Batra VS. Delhi Administration, AIR
directing a person who has detained, to 1970 SC 1675 - A prisoner addressed a letter
produce that person before the court. He is to the Court that the Jail Authorities were
also asked to let the court know by what assaulting another prisoner. The court treated
authority he has detained that person. If the the letter as a petition for Habeas Corpus.
cause shown has no legal justification, the Rudul Sha vs. State of Bihar 90 , an
court orders immediate release of the person acquitted person was detained for more than
detained. The court may also award exemplary 14 years. The Supreme Court through Y. V.
damage. Chandrachud, C.J. directed immediate release
The Supreme Court, in 89 , AIR 1983 and awarded exemplary damages
SC 1086 awarded the exemplary damages of ofRs.35,000/-
Rs.35,000/- to an acquitted person, who was
detained for more than 14 days. Similarly in

89 90
. Rudul Sha vs. State of Bihar (1983) 4 SCC 141 . AIR 1983 SC 1086

69
 Bhim Singh vs. State of J & K91, Bhim The petitioner seeking the writ, has to
Singh, an M.L.A. was arrested unlawfully. His satisfy the following conditions:
wife filed an application for Habeas Corpus. 1. There must be a public duty on the part of
Then, the Supreme Court directed immediate the respondent;
release and awarded the exemplary damages of 2. Such duty must be absolute;
Rs.50,000J- . 3. There must be specific demand and
b) Writ of Mandamus refusal;
Meaning 4. Subsisting Duty.
The expression 'Mandamus' is a Latin In Gujarat State Financial Corporation vs.
92
term, which means "We Command". Lotus Hotels (P) Ltd., the Corporation
Mandamus is a Judicial Order issued in form entered into an agreement with Lotus Hotels to
of a command to any Constitutional, Statutory provide finance for construction of a hotel, and
or Non Statutory authority asking to carry out did not release the funds. The Gujarat High
a public duty imposed by law or to refrain Court issued the Writ of Mandamus to release
from doing a particular act, which the the funds as agree.
authority is not entitled to do under the law. It Manjula Manjari vs. Director of Public
93
is an important writ to check arbitrariness of Instructions , in this case, the petitioner
an administrative action. It gives positive as applied for the Writ of Mandamus since the
well as negative remedy. It is popularly known respondent, Director of Public Instructions did
as the 'Writ of Justice' not include his book in the list of prescribed
Locus Standi or who can file a petition for books. The Orissa High Court refused the
the Writ petition on the ground that the respondent had
The rule of Locus Standi is strictly a discretionary power to select good books.
followed except in public interest litigation. c) Writ of Certiorari
The petitioner has to prove that he has a right Meaning
to enforce public duty in his favour. This writ confers power on the
Authorities to which the writ may be issued Supreme Court and High Courts, over the
The Writ of Mandamus may be issued lower courts to correct illegality of their
against the Government, Semi Government decisions.
and all public Authorities (Judiciary, 'Certiorari' is an order or command by
Tribunals, Universities, Colleges etc.). In the Supreme Court or High Court to an inferior
short, it is available ,against all administrative (lower) court or quasi-judicial or
actions. administrative body. The inferior authority is
Conditions directed to transmit the records, to check
whether the decision by such authority is

92
. AIR 1983 SC 848
91 93
. AIR 1986 SC 494 . AIR 1952 Ori. 344

70
illegal or against the principles of natural Meaning
justice. If it is found illegal, the decision is The Writ of 'Quo Warranto' questions
quashed. But, nothing is Substituted to such the title as to the holder of an office. The term
decision quashed. 'Quo Warranto' means "By What Authority". It
Grounds for issuing the writ is a judicial order asking a person, who
The Writ of certiorari may be issued on occupies public office, to show by what
the following grounds: authority he holds the office. If it is found that
1. Judicial Error or Lack of Jurisdiction; the holder of the office has no valid title, then
2. Improper constitution of such the Writ of Quo Warranto is issued to him to
authority; oust (vacate) from the office.
3. If the authority is incompetent; Locus Standi (Who can file a petition for
4. Its jurisdiction is unconstitutional; and the writ)
5. Violation of the principles of natural A petition for the Writ of Quo
justice. Warranto can be filed by any person though he
94
In [Link] vs. Union of India , the is not an aggrieved person.
Supreme Court issued the Writ of Certiorari to Conditions for the Grant of Quo Warranto
quash the selection list of the Indian Forest If the Writ of Quo Warranto is to be
service on the ground that one of the se1ected issued, the following conditions should be
candidates was the ex-officio member of the satisfied:
selection committee. 1. The office must be a public office;
95
Hari Vishnu vs. SyedAhmed , the 2. The office must be substantive in nature
Supreme Court quashed the decision taken by (permanent in character and not
the Election Tribunal on the ground that it terminable).
ignored certain rules. 3. The person must be in actual possession
d) Writ of Prohibition of the office;
The Writ of Certiorari and the Writ of 4. The person must have held the office
Prohibition have so many common contrary to law; and
characteristic features, the only difference 5. Subsequent disqualification:
between the two is: In [Link] Raju vs. State of Andhra
The Writ of Prohibition is issued to prevent the Pradesh 96 , the Andhra Pradesh High Court
decision or administrative action in the quashed the appointment of a Government
process, so that it cannot proceed further, Pleader on the ground that the rules for the
while; the Writ of Certiorari is issued to quash said appointment are not complied with.
the decision already given.
e) Writ of Quo Warranto

94
. AIR 1970 SC 150
95 96
. AIR 1955 SC 233 . AIR 1981 AP 24

71
 The Writ of Quo Warranto cannot be In view of the increasing number of
issued if it does not serve any purpose i.e. it is appeals under Article 136, the Supreme Court
futile. suggested the Government (Janata
97
Lakhan Pal vs. [Link] , in this case, Government) to curtail its jurisdiction under
the 'appointment of Justice [Link] as the Article 136. But the proposal could not be
Chief Justice of India ignoring three senior materialised since lawyers opposed it.
Judges was questioned through a petition for
quo warranto. The Supreme Court quashed the II. CIVIL LAW REMEDIES
petition on the ground that the writ would not In addition to the constitutional remedies
serve the purpose since the three senior Judges stated above, the aggrieved can have the
had already resigned. following remedies known as 'Civil Law
SPECIAL LEAVE TO APPEAL (Art.136) Remedies'.
Article 136 of the Indian Constitution 1. Injunction;
empowers the Supreme Court to grant special 2. Declaration; and
leave to appeal from any judgment, decree, 3. Damages.
determination, sentence or order in any matter 1) Injunction
passed by any Court or Tribunal. The Supreme An 'injunction' is an order of the Court
Court can exercise discretionary power in this of justice directing the defendant to do some
connection. positive act or restraining the commission or
There are number of appeals before continuance of some prohibitory act causing
the Supreme Court under Article 136 and injury to the plaintiff. It may be interim
hence this Article is called 'Lawyers Paradise'. (temporary) or perpetual (permanent).
Grounds for granting special leave 2) Declaration
The remedy under Article 136 is extra- Declaration of rights of parties by, the
ordinary and discretionary, and hence, it is Court without giving further relief.
granted in exceptional cases on the following 3) Damages
grounds. If the tribunal – The expression 'damages' means
1. has acted in excess of the jurisdiction; "compensation in form of a certain sum of
2. failed to exercise its apparent jurisdiction; money, which the injured (plaintiff) is entitled
3. committed an error of law apparent on the to get for having suffered such injury. There
face of the record; are different kinds of damages namely:
4. acted illegally; Contemptuous damages, Nominal damages,
5. violated the principles of natural justice; Liquidated, Unliquidated, Exemplary damages
6. the decision involved an important etc.
question of law.

97
. AIR 1975 Del. 66

72
 Chapter - VIII
PUBLIC UNDERTAKINGS AND PUBLIC CORPORATIONS

In view of the change in the Government Government from the various forms of
Philosophy from the laissez faire to the social organisations. A large number of public
welfare state, there has been tremendous enterprises are run by the Government
growth and development of public departments such as Railways, Posts,
undertakings and corporations. Article 298 of Telegraphs, Telecommunications etc. under
the Indian Constitution empowers the Union of the Ministry of Railway, Industries etc.
India and states to carry on any trade or 2) Government Companies (Non-statutory
business by entering into contracts through its public undertakings)
executive power. The trade or business may be Government Companies are non--
carried on by the State/Government through statutory Public Undertakings registered under
the Public Undertakings or Public the Companies Act, 1956. They are limited
Corporations. This lecture covers: liability companies where the government
Public Undertakings: Meaning and holds the majority share capital. A
Classification Government Company is defined under
When trading of business or social Section 617 of the Companies Act, 1956 in the
service functions· are carried on by the following terms: "For the .purpose of this Act,
Government through a Public 'Government Company' means any Company
Corporation/Statutory Corporation, a in which not less than fifty-one per cent of the
Government Department or a Government paid-up Share Capital is held by the Central
Company, it is called a Public Undertaking. Government or by State Government or
E.g.: Railway Department, State Trading Governments, or partly by the central
Corporation, State Electricity Board etc. Government and partly by one or more State
The Public Undertakings may be Governments and includes a Company which
classified into the following: is subsidiary of a government company thus
1. Government Departmental Undertakings. defined".
2. Government Companies (Non-statutory A Government Company is not a
public undertakings); and 'State' within the meaning of Article 12 of the
98
3. Public Corporations or Statutory Constitution of India . Employees of a
Corporation. Government Company are not government
1) Government Departmental Undertakings
The main object of these undertakings
is development activities. There is no
consistent pattern visible in the choice of 98
. Vide Kartick Chandra Nandi vs. [Link]
Industries Corp., AIR 1967 Ca1.231

73
servants within the meaning of Article 311 of entrusted with various functions of public
the Constitution99. importance and owned or controlled by the
Since a Government Company is State. It is an artificial person being created by
neither a creation of a statute nor State within law having legal entity entirely separate and
the meaning of Article 12 of the Constitution, distinct from the individuals who compose it
it is not subject to the Writ jurisdiction of High with the capacity of continuous existence and
Court under Article 226 of the Constitution (R. succession notwithstanding changes in its
100
Lakshmi vs. Neyveli Lignite Corp. . membership. The public corporation (statutory
Nevertheless, a Writ of mandamus would be corporation) has both the features of a
issued against a Government Company to Government Department and business
enforce a statutory or public nevertheless, a company.
Writ of mandamus would be issued against a Definition:- There is no precise definition to
Government Company to enforce a statutory the expression 'corporation' either in the
or public duty required by the statute 101 . statutes or in the judicial decisions. Public
Accordingly, the Kerala High Court issued a corporation means a body established by or
Writ against a Government Company when it under a statute and is owned or controlled by
acted in violation of statutory duty imposed the state and which is entrusted with various
upon it by the Import and Export Control Act, developmental, managerial, or economic
1947 in matters of regulation of import and functions of public importance.
export in cashewnuts 102. A Pubic Con oration may be defined
A number of huge projects are being as an agency created by a statute of legislature,
run as Government Companies rather than running a service on behalf of the government,
statutory Corporations, E.g.: Hindustan Steel but as an independent legal entity with funds
Ltd., Heavy Engineering Corporation; Mining of its own and largely autonomous in
and Allied Machinery Corporation; Steel management. It has no regular form and no
Authority of India; Fertilizer Corporation; specialised function. It is employed wherever
Hindustan Antibiotics, Cement Corporation; it is convenient to confer corporate
State Trading Corporation of India etc. personality. In Stkhdev Singh vs.
3) Public Corporations or Statutory Bhagatram 103 , Mathew, J. the crux of the
Corporations matter is that Public Corporation is a new type
A public corporation may be taken to of institution which has sprung from the new
mean a body created by or under a statute and social and economic functions of government
and that it therefore does not neatly fit into old
99
. State of Assam vs. Kanak Chandra Dutta, AIR
1967 SC 884 legal categorie,. Instead of forcing it into them,
100
. AIR 1966 Mad. 399
101
. Praga Tools Corp. vs. C [Link], AIR 1969
SC 1306
102
. [Link] vs. Union of India, AIR 1974
103
Kerla . AIR 1975 SC 1331

74
the latter should be adapted to the needs of privileges as may be conferred on it by the law
changing times and conditions. of its creation just as a natural person may.
Garner rightly enunciates Characteristics
A Public Corporation is a legal entity A Public Corporation is a 'hybrid
established 10rmally by Parliament and always organism', since it contains/comprises of both
under legal authority, usually n. the form of a the features of a Government department and
special statute charged with the duty of of a business company. A Public Corporation
carrying 011: specified governmental whether created by or under a statute possesses
functions in the national interest, those the following characteristic features:
functions being confined to a comparatively 1. A Public Corporation is created by or
restricted field, and subject to control by the under a statute. It operates an activity on
Executive, while the Corporation remains behalf of the government in public
juristically an independent entity nor directly interest. It discharges functions of a
responsible to Parliament. government character.
In Halsbury' Laws of England a 2. A Public Corporation possesses an
Corporation is defined as 'a body of persons a independent corporate personality. It is a
an office which is recognised by law as having body corporate with perpetual succession
a personality which is distinct from the and common seal. It can sue and be sued
separate personalities of the members of the in its corporate name.
body or the personality of the individual 3. A Public Corporation has those rights and
holder for the time being of he office in exercises those functions entrusted to it
question. by its constituent statute by which it is
A Corporaion is defined in Dhanoa vs. created. Any action of such Corporation
104
Municipal Corporation, Delli in the not expressly or impliedly authorised by
following terms: the statute is ultra vires and cannot bind
A Corporation is an artificial being the Corporation. Such ultra vires action
created by law having legal entity entirely has no legal effect whatsoever.
sep8"ate and distinct from the individuals who 4. A Public Corporation can possess, hold
compose it with the capacity of continuous and dispose of property by its corporate
existence and succession, notwithstanding name.
changes in its membership. In addition, it 5. Depending on the provisions of the statute
possesses the capacity as such legal entity of by or under which a public Corporation is
taking, holding and conveying property, created such Corporation is by and large
entering 1to contracts, suing and being sued, an autonomous body. The Corporation is
and exercising such other powers and its own master in day-to-day management
and administration.
104
. AIR 1981 SC 1395

75
6. The constituent statute may delegate rule- iv. Financial Corporation.
making power to a Public Corporation. The above classification is not
Such rules, regulations and bylaws are watertight and is based on the dominant
binding and enforceable unless they are objective of the concerned undertaking.
ultra vires the enabling Act and the 1) Commercial Corporations
Constitution of India. This classification includes those
7. A Public Corporation created by or under Corporations, which carryon commercial and
a statute is a 'State' within the definition industrial functions. State Trading
of the term in Article 12 of the Corporation, Hindustan Machine Tools Ltd.,
Constitution, and therefore, is subject to Indian Airlines Corporation and Air India are
the Writ jurisdiction of the Supreme some of the Commercial Corporations.
Court under Article 32 and of the High· 2) Development Corporations
Courts under Article 226 of the Development Corporations are those
Constitution. which encourage national progress by
8. Employees of a Public Corporation do not undertaking developmental work in the
hold a 'Civil Post' under the Union or the Country. Oil and Natural Gas Commission,
State within the meaning of Part XIV of Food Corporation of India, National Small
the Constitution of India. Industries Corporation, Damodar Valley
9. A Public Corporation is not a 'citizen' Corporation, River Boards, Warehousing
within the meaning of Part II of the Corporations, National Research Development
Constitution and therefore, it cannot claim Corporation Ltd., Rehabilitation Housing
the benefits of those Fundamental Rights, Corporation Ltd., etc. are Development
which have been guaranteed only to the Corporations.
citizens. 3) Social Service Corporations
10. Since a Public Corporation is neither a Corporations which have been created
department nor an organ of the for the purpose of providing certain essential
government, it cannot claim the privilege services to the people, like transportation,
of the government to withhold electricity, communications, energy, etc. are
documents. social services Corporations. This objective of
such Corporations is to provide services to the
Classification of Public Corporations community economically and efficiently and
Basing on the nature of work undertaken, earning profits is not the primary aim. Hospital
Public Corporations may be classified into 4 Boards, Employees' State Insurance
categories as follows: Corporation, Housing Board, etc. are included
i. Commercial Corporations; under this classification.
ii. Development Corporations; 4) Financial Corporations
iii. Social Services Corporation; and

76
 Under this classification one may include iii. The Industrial-Policy Resolution, 1948 of
such Corporations as Reserve Bank of India, the government was strongly in favour of
State Bank of India, Industrial Finance public corporations for the management
Corporation, Life Insurance Corporation of of state enterprises.
India, Film Financing Corporations, Industrial iv. Administrative Reforms Commission,
Reconstruction Bank, Unit Trust of India, etc. 1967 also recommended the creation of
These bodies advance loans to institutions public corporations for government's
carrying on trade, business or industry on such commercial activities.
terms and conditions as may be agreed upon. Working of public Corporations
Reasons for Growth of Public Corporations The Constitution, structure, functions,
Following are the main reasons for the powers and duties of the public corporations
growth and development of the Public can be better understood by the survey/study
Corporations: of the actual working of a few public
i. The main reason for its tremendous corporations as detailed below:
growth is the change in the government 1) Life Insurance Corporation of India
philosophy from the 'laissez fair' concept (L.I.C).
to the 'social welfare state'. The 2) Reserve Bank of India (R.B.I).
multifarious functions of the modem 3) State Bank 0 India (S.B.I).
welfare state cannot be discharged 4) Oil and Natural Gas Commission
through the government departments (O.N.G.C).
alone. Thus for doing various functions of 5) Road Transport Corporation (R.T.C.).
the government a number of public 6) State Trading Corporation (S.T.C).
corporations have been created. 7) Air Corporations.
ii. The Directive Principles of State Policy 8) Damodar Valley Corporation (D.Y.C).
[Art.38 (b) (c)] which requires the state to 9) Rehabilitation Finance Corporation.
adopt a policy towards securing the 10) Broadcasting Corporation of India.
ownership and control of material
resources of the community are 'So 1) Life Insurance Corporation of India
distributed as best to serve the common (L.I.C)
good, and the operation of the economic The Life Insurance Corporation of
system does not result in the India has been established by the Life
concentration of wealth and means of Insurance Corporation Act, 1956 to carry on
production to the common detriment. To the business of Life Insurance which has been
achieve this goal the government has also Nationalised. It is a body Corporate with
entered the commercial world through perpetual succession and common seal. It can
various public corporations. acquire, hold and dispose of property. It can
sue and be sued.

77
 The Corporation is constituted of such The Reserve Bank has been given
number of persons not exceeding sixteen as extensive powers over the Banking business in
the Central Government may think fit to India by the Banking Companies Act, 1949. It
appoint. It has a Central Office and a number is empowered to grant licences without which
of Zonal Offices. It enjoys exclusive privilege no Company can carryon Banking business.
of carrying on Life Insurance business in Before giving such licence, it can inquire into
India. the affairs of the Company to satisfy itself as
Under the Act, the Corporation is regards the Company's capacity to pay back to
required to develop the business to the best its depositors. It can cancel a licence on the
advantage of the community. The Central ground that the conditions specified therein
Government is empowered to give directions had not been complied with.
in writing in the matters of policy involving Broad discretionary powers have been
public interest. The Corporation shall be conferred on the Reserve Bank. It determines
guided by such directions. the policy relating to Bank advances frames
The Corporation is an autonomous proposals for amalgamation of two or more
body as regards its day-to-day management Banks. Representation may be made by it to
and administration. It is an independent suspend the operation of the Banking
institution free from ministerial control as to Companies Act. In case of emergency, the
broad guidelines of policy. Governor of the Bank is empowered to
2) Reserve Bank of India (R.B.I) suspend the operation of the Act for 30 days.
The Reserve Bank of India was The Courts have upheld the validity of these
established under the Reserve Bank of India broad discretionary powers.
Act, 1934. It was Nationalised in 1948 by the 3) State Bank of India (S.B.I)
Reserve Bank (Transfer of Public Ownership) The State Bank of India was created
Act, 1948. It is a body corporate with by the State Bank of India Act, 1955 to carry
perpetual succession and common seal. It is a on Banking business under Government
legal entity. It can sue and be sued. It is Control. It follows the policies laid down by
managed by a Board of Directors, consisting the Central Government. The Central
of a Governor, two Deputy Governors and a Government determines the policies in
number of Directors. The Governor and consultation with Governor of Reserve Bank
Deputy Governors are whole-time employees. and Chairman of the State Bank. The decision
They are appointed by the Central Government of the Central Government is final on matters
for a term of five years. They receive such of policy in public interest.
salaries and allowances as may be fixed by the 4) Oil and Natural Gas Commission
Board with the approval of the Central (O.N.G.C)
Government. The Oil and Natural Gas Commission
has been set up by the Oil and Natural Gas

78
Commission Act, 1959, for the development of incorporation of Road Transport Corporations
petroleum resources. It is a body corporate and in which the Central and State Governments
enjoys perpetual succession and common seal. are to be properly represented, for the purpose
It can sue and be sued. It has power to hold of improving Road Transport facilities, E.g.:
and dispose of property. Gujarat State Road Transport Corporation.
The Commission consists of the A Road Transport Corporation is
Chairman and two or more members not managed by a Chief Executive Officer, a
exceeding eight. All are to be appointed by the General Manager and a Chief Accountant who
Central Government. Except the Finance are appointed by the State Government for
Minister, others may be part-time or full-time constituting the Corporation. The capital is
members. Any member may be removed by contributed in part by the Central Government,
the Central Government after giving a show- while the remaining capital is borne by the
cause notice and a reasonable opportunity of State Government concerned in proportions as
being heard. agreed. The capital can be raised by the
The Commission has its own funds Corporation by issuing non-transferable
and all receipts of the Commission are credited shares. The Capital, Shares and dividends arc
thereto and expenditures of the Commission guaranteed by the Government.
are made there from. It also maintains an The Corporation is a legal entity and
account with the Reserve Bank of India. With independent of the State Government. It is a
the prior approval of the Central Government, body corporate with perpetual succession and
the Commission can borrow money. a common seal. It can sue and be sued in its
The functions of the Commission corporate name. The employees are public
range from planning, promotion, organisation servants within the meaning of Sec.2 1 of the
or implementation of programs for the Indian Penal Code, and not Civil Servants
development of petroleum resources to within the meaning of Articles 311 of the
production and sale of petroleum products it Constitution.
produces. Geological surveys are also As regards function, the Corporation is
conducted by the Commission for the required to provide efficient, adequate,
exploration of petroleum. The Commission economical and a properly co-ordinate system
also undertakes drilling and prospecting of Road Transport Services in the Country. It
operations. The purposes connected with the has power to acquire, hold and dispose of
Commission's work are deemed to be public property. It can borrow money subject to
purposes within the meaning of the aforesaid approval of the State Government.
Act. 6) State Trading Corporation (S.T.C)
5) Road Transport Corporations (R.T.C) State Trading Corporation of India is a
The Road Transport Corporation Act, Government Company. It is wholly owned by
1950 empowers State Governments for the the Government. All the shares are held by the

79
Central Government and two Secretaries of the Corporation Act, 1948. The Damodar Valley
Government of India. Corporation is a corporate body having
The object of the Corporation as stated perpetual succession and common seal. It has
in the memorandum of the association is to separate legal entity. The Board of
organise and undertake generally with the Management consists of a Chairman and two
State Trading Countries and also other members. They are to be appointed by the
Countries trade in commodities entrusted to it Union Government in consultation with the
for such purposes by the Central Government State of the West Bengal and Bihar and they
from time to time and undertake the purchase, may be removed by the Union Government for
sale and transport of such commodities in incapacity or abuse of position. The
India or anywhere else in the World. It can do Corporation has been established for
various acts for that purpose. Since the controlling floods in Damodar River and for
Corporation is constituted under the utilising the water of Damodar river for
Companies Act, 1956, all the provisions of the irrigation, navigation and generation of
Act apply to it. It can be wound up by a electrical energy. For this purpose, the
competent Court. It is neither a department nor Corporation has been given power to establish
an organ of the Government of India. Its experimental institutions and research stations.
functions are commercial in nature. It can establish and operate laboratories also.
7) Air Corporations The Corporation provides assistance in
The Air Corporations Act, 1953 has construction of powerhouses; dams, etc. It also
established two corporations, called 'Indian promotes sanitation and economic and social
Airlines' and 'Air India International'. This Act welfare of the Damodar Valley and supplies
was enacted with the object to nationalise the electricity and water. The corporation has its
existing airlines in India. Each corporation is own funds. Its funds have been deposited in
managed by a Board of Directors and the the Reserve Bank of India. The Corporation
Chairman of each corporation is appointed by can borrow money after obtaining the approval
the Central Government. of the Union Government. It is a legal person
It is the function of each Corporation and has power to acquire, hold and dispose of
to provide safe, efficient, adequate, its property and liable to income tax, sales tax,
economical and properly co-ordinate air etc. It can sue and be sued in its own name.
transport services, whether national or 9) Rehabilitation Finance Corporation
international or both. However, in discharging It has been established by the
its duties, each corporation is to act on Rehabilitation Finance Corporation Act, 1948.
business principles. It has separate legal personality and has
8) Damodar Valley Corporation perpetual succession and common seal. Its
Damodar Valley Corporation (D.V.C) main object is to provide financial assistance
has been set up by the Damodar Valley on reasonable terms to displaced persons so as

80
to enable them to settle in business, trade or seal. It can sue and be sued in its corporate
industry. It has been given wide powers for the name.
recovery of the loans. It is managed by a Public Corporations has been
Chairman and other members appointed by the recognised in the Constitution of India. As
Union Government. They hold offices during provided under it, the State may carry on any
the pleasure of the Union Government. The trade, industry, business or service either itself
Advisory Board and Regional Committees or through a Corporation owned or controlled
extend them assistance to it in the discharge of by it to the exclusion of citizens. The laws
its functions. providing for State monopolies are also saved
10) Broadcasting Corporation of India by the Constitution.
The Central Government declared the Rights and Liabilities of Public Corporation
constitution of Broadcasting Board of India on 1) Rights
November 23, 1997. It is notable that the Public Corporation (statutory
Broadcasting Corporation of India Act corporation) has independent legal personality.
granting autonomy to Radio and Television It is a legal person. It is a body corporate and
came into force on September 15, 1997, but has perpetual succession and a common seal.
even after, the signature of the President, it Being a legal person, it can own, enjoy and
was kept pending for 7 years and was notified dispose of property in its own name. Being a
on July 22, 1997. legal person, it can sue and be sued in its own
Although the Board will not be under name.
the control of the Government, even then it is A Public Corporation is a person but
provided in the Act that the Government can not a citizen. And therefore it can claim the
issue directions to prevent any special benefit of the Fundamental Rights guaranteed
broadcasting or broadcast any special matter. to the every person whether citizen or non-
On account of certain practical citizen but it cannot claim the benefit of the
shortcomings existing in the Broadcasting Fundamental Rights guaranteed only to the
Corporation of India Act, the Central citizens.
Government has made certain important Thus, being a person, a public
amendments in the Act by issuing an corporation can enforce those Fundamental
Ordinance on October 31, 1997. Rights which are guaranteed to all persons
Status of Public Corporations whether citizen or not but not being a citizen,
Public Corporations enjoy juristic and it cannot enforce the Fundamental Right
constitutional status as stated below: guaranteed only to the citizens.
A Public Corporation is a juristic It is to be noted that the Fundamental
person. It possesses a separate and distinct Rights in Articles 15, 16, 19, 29 and 30 are
corporate personality. It is a body corporate available only to the citizens while the
having perpetual succession and a common Fundamental Rights guaranteed by other

81
Articles are available to the citizens and also to 1185). No right can be said to have accrued in
non-citizens. A public corporation is not a favour of a private individual and no
citizen and therefore it cannot enforce the corresponding duty of a Corporation arises for
Fundamental Rights guaranteed by Articles 15, breach of a contract, which is void.
16, 19,29 and 30 but being a person it can ii) Liability in Torts or Tortious Liability
enforce the Fundamental Rights guaranteed by A public Corporation can be sued for
the other Articles. the torts committed by its servants provided
2) Liabilities of the Public Corporation the act is within the powers of the Corporation
The liability of the Public and that it would be actionable if committed
Corporations may be explained with reference by a private individual. But the Corporation
to the following heads: would not be liable if the act of the servant is
i. Liability in Contracts or Contractual ultra vires the powers of the Corporation or is
Liability. such that it could under no circumstances have
ii. Liability in Torts or Tortious Liability; authorised its servant to commit it. For acts,
and which are ultra vires, the servant would be
iii. Liability for Crimes or Criminal Liability. personally liable106.
A state creating a Public Corporation
i) Liability in Contracts or Contractual may exclude liability for acts done by its
Liability servants in good faith under the Act. For
A Public Corporation can enter into example, Section 28 of the Oil and Natural
contract. It can sue and be sued for breach of Gas Commission Act, 19591ay down: "No
contract. Since a public Corporation is a suit, prosecution or other legal proceedings
statutory public undertaking, it can do only shall lie against the Commission or any
those acts which ar:e authorised by the statute member or employee of the Committee for
either expressly or by necessary implication. If anything which is in good faith done or
any requirement has been laid down in the intended to be done in pursuance of this Act or
constituent statute or in the rules, regulations of any rule regulation made thereunder".
or bylaws of the Corporation, it must be iii) Liability for Crimes or Criminal
complied with105. Whatever is not expressly or Liability
impliedly authorised by the constituent statute A Public Corporation may also incur
can be said to be prohibited and must be held liability for offences committed by its servants
to be ultra vires. The contract, which is ultra in the course of employment. However, since
vires, is void ab initio and cannot be ratified it is an artificial person having corporate
(Lakshmanswami vs. L.I. c., AIR 1963 SC identity, it cannot be punished with death or
imprisonment. It follows that a Corporation
105
. Cope vs. Thames Rly Co. (1849) 3 Ex 841;
British Transport Corpn. v. Westmorland
106
Country Council, (1957) 2 All ER 353 . Lakshmanswami vs. LIC, AIR 1963 SC 1185

82
cannot be found guilty of an offence for which Jurisdiction of Courts over a Public
the punishment is death or imprisonment. A Corporation is the same as it is over a private
Corporation can also not be held liable for an or Public Company, which can sue and be
offence, which can only be committed by a sued like any ordinary person. Accordingly, a
natural person, E.g.: Bigamy. Public Corporation is liable for a breach of
But a Public Corporation can be held contract and also in tort for the tortious acts of
vicariously liable for offences committed by its servants like any other person. It is bound
its agents, servants and employees, E.g.: by a statute.
Libel107, Fraud108 and Public Nuisance109. Traditionally, judicial control on
CONTROLS OVER PUBLIC corporation is exercised through the doctrine
CORPORATIONS of ultra vires by declaring an act ultra vires if
Public Corporations are established with the corporation exceeds its authority. In
the objective of promoting economic activity. practice, however, it may be difficult to invoke
Since the public corporations are conferred the doctrine of ultra vires because in many
autonomy and enormous powers, there is a cases powers of the corporation are so widely
possibility for misuse of the power. Therefore, described that it may not be possible for the
it is necessary to control the public corporation court to declare any particular act of the
so that the powers of the public corporations corporation to be ultra vires. With the passage
are not misused. Such controls are discussed of time, the courts have been expanding the
under the following heads: scope and extent of their control over public
(a) Judicial Control. corporations beyond the doctrine of ultra vires.
(b) Parliamentary Control. The courts have been conscious of the fact that
(c) Government Control, and the bodies participating in the administrative
(d) Public Control. process are kept out of their supervision, then
A) Judicial Control there will be arbitrariness in the
A Public Corporation is a juristic administration.
person having legal entity to sue and be sued. In Lakshmanaswami vs. L.I. C. of
It is a body corporate with perpetual India, the Company passed a resolution
succession and common seal. Legal donating a sum of Rs.2 lakhs to a trust from
proceedings may be instituted by or against a the amount to be paid to the shareholders.
Corporation in its corporate name. Its entity is Under the Articles of Association, the
distinct and separate from government. Company was not authorised to make such
donation. The Supreme Court held that the
resolution was ultra vires.
107
. Triplex Safety Glass Co. vs. Lancegaya Safety
Glass Co. (1939) 2 All ER 613
In course of time, the Courts have
108
. R. vs. [Link] (1944) 1 All ER 691 been expanding the scope and extent of their
109
. Campbell vs. Paddington Corpn. (1911) 1 KB
869 control over public undertakings beyond the

83
confines of the doctrine of ultra vires. The business managements, and judicial control of
Courts have been conscious of the fact that a public power tending to berserk, is one of the
'Welfare State' acts through statutory creative claims upon functional jurisprudence'.
Corporations and Companies. Thus, Public Sector occupies the commanding
Corporation has become a third arm of the heights of national economy. Accordingly, this
government. The functions, which they sector cannot assert a right to be free from
perform, are otherwise to be performed by the judicial review.
government. Being a creation of State, a public With regard to the judicial control
corporation must be subject to the same over public corporations is concerned, the
constitutional limitations as the State itself. question that arises is whether public
Moreover, statutory Corporations and corporations are state within the meaning
Government Companies are held to be other Art.12 for the purpose of enforcing
authorities and as such, State within the fundamental rights against it. Faced with this
meaning of Article 12 of the Constitution. situation, the courts have extended the notion
There is no reason why these Corporations of state to the public corporations so as to
should not be subject to the same judicial bring them within the bounds of judicial
control as the government itself. However, control and increase the extent and
statutory Corporations are subject to the Writ effectiveness of judicial control over the public
jurisdiction of the Supreme Court and High corporations. And as such it is subject to the
Courts110. writ jurisdiction of the Supreme Court under
Explaining the philosophy of judicial Art.32 and the High Courts under Art.226.
control of public undertakings in Fertilizer In Rajasthan State Electricity Board
Corporation Kamgar Union vs. Union of vs. Mohanlal112 the question arose whether the
India 111 Krishna Iyer, J. observed that Public Electricity Board was an authority and hence
Sector has assumed great significance in India. state within the meaning of Art.12. The
Public enterprises are owned by the people and Supreme Court held the Board to be state. The
those who run them are accountable to the reason given by the Court to treat the Board as
people. Public enterprises are autonomous and state were (1) it was created by a statute and
this autonomy is vital to effective business (ii) it was carrying on governmental or quasi-
management. But judicial control of public governmental functions. Applying the same
power is essential to ensure that it does not tests in Sukhdev Singh vs. Bhagatram113 the
behave in an irresponsible manner. In the Supreme Court held that the Oil and Natural
words of Justice Iyer: 'The active co-existence Gas Commission, the Life Insurance
of Public Sector autonomy so vital to effective Corporation and the Industrial Finance

110
. [Link] vs. International Airport Authority,
112
AIR 1979 SC 1628 . AIR 1967 SC 1857
111 113
. AIR 1981 SC 344 . AIR 1974 SC 1331

84
Corporation as a state within the meaning of Still, it remains how far can the court
Art.12. go? Apart from applying the constitutional and
The Supreme Court continued to public law checks, could the court act as a
attach great importance to the manner of super watchdog? The courts can control the
creation of the bodies, in determining their corporation on the broad parameters of
legal status was evident from Sabhajit Tewary fairness in administration, bona fides in action
114
vs. Union of India wherein the Supreme and the reasonable management of public
Court held that the Council of Scientific and business. A public corporation can be sued for
Industrial Research which is a society breach of contract under ordinary law. It is
registered under the Societies Registration Act vicariously liable for torts committed by its
not to be state. The court held that the society servants just like any other incorporated body.
does not have a statutory character. The writ of mandamus will lie against a public
The question received a detailed corporation for enforcement of statutory duty,
examination in [Link] vs. International such as duty to provide public benefit or
115
Airport Authority of India and the Court facility. In Corporation of Nagpur vs. Nagpur
held that to determine whether a legal entity is Electric Light & Power Co.117 mandamus was
state within the meaning of Art. 12, the main issued at the instance of Corporation of
test was to examine the nature of its function Nagpur (a consumer) against the respondent, a
and the extent of governmental involvement public utility corporation established for the
and control. The fact that it is created by a supply of electricity to the public, to compel it
statute or under a statute would be an to supply electricity to the Nagpur
irrelevant consideration in determining the Corporation.
question whether it is state. The same view In Rowjee vs. State of A.P 118 the
was expressed by the Supreme Court in Ajay Supreme Court struck down a scheme
116
Hassia vs. Kalid Mujib . In this case prepared by the A.P.S.R.T.C. to nationalise
Bhagwati J. said 'it is immaterial for certain road transport routes. There was
determining whether a corporation is an evidence that the scheme was prepared at the
authority, whether the corporation is created instance of the Transport Minister who had
by a statute or under a statute. The test is political rivalry with private bus operators
whether it is an instrumentality or agency of whose routes were proposed to be
the government and not how it is created. The nationalised. The Court viewed the action
enquiry has to be not as to how the juristic mala fide and on the ground it struck down the
person (corporation) is born but why it has scheme.
been brought into existence'

114
. AIR 1975 SC 1331
115 117
. AIR 1979 SC 1628 . AIR 1953 Born. 498
116 118
. AIR 1981 SC 487 . AIR 1964 SC 1962

85
B) PARLIAMENTARY CONTROL The another method of controlling the
Public Corporations are created and public corporation is the provision for laying
owned by the State. They are financed from the rules and regulations on the table of the
the funds supplied by the government. They House of Parliament. Usually the statute
are required to exercise their powers in public creating the corporation contains the provision
intcrest. It is, therefore, necessary for requiring the rules and regulations made under
Parliament to exercise control over these the statute to be laid before the House of
Corporations. Parliament. However, all the statutes do not
The establishment and continuance of contain such provisions. For example, the
the public corporation depend on the statute, Damodar Valley Corporation Act does not
which creates it. The statute enacted by provide for such laying. The laying provision
Parliament for the creation of the public enables Parliament to scrutinize the
corporation (statutory corporation) determines functioning of the corporation.
the powers and functions of the corporation. Discussions of annual accounts and
The public corporation cannot violate the reports submitted by the public corporation to
provisions of the statute, which creates it. It Parliament is an important method of
can do only those acts, which are authorised parliamentary control of the public
by the statute either expressly or by necessary corporations. This also provides opportunity to
implication. The act of the public corporation Parliament for discussion on the functioning of
which is not expressly or impliedly authorised the public corporation. However, there is no
by the statute is held to be ultra vires and, general, legal obligation on the part of the
therefore, void and cannot be validated by public corporation to present their budget
ratification. If the powers are misused and the estimates to Parliament. The real control is
corporation acts against the interest of society. exercised by Parliament through its committee.
Parliament which has passed the statute for the The most effective Parliamentary
establishment of the corporation may control over the affairs conducted by public
supersede or abolish it. Parliament can amend Corporations is exercised through the
the statute, which has been passed by it for the Parliamentary Committees. Parliament is too
establishment of the corporation. At the time large and busy body and it is not possible for it
of amendment of the statute. Parliament gets to probe into details the working of these
opportunity to discuss the affairs of working of Corporations. It was in sequel to the
the corporation. When the bill for the creation recommendations of Menon Committee on
of the public corporation is presented in the Parliamentary Supervision over State
House for passage, it is debated for a long time undertakings that the Parliament has
and an attempt is made to insert in the bill the constituted the Committee on Public
provisions or its proper control so that the Undertakings in 1964. The functions of the
powers are not misused. Committee are:

86
a) to examine the reports and accounts of the iii. Order enquiries.
public undertakings; iv. Financial Control.
b) to examine the reports, if any, of the v. Rules and Regulations.
Comptroller and Auditor General on the (1) By issuing Directions to the
Public Corporations; Corporation:- One of the important
c) to examine in the context of the autonomy methods of Governmental Control of the
and efficiency of the Public Corporations public corporation is to authorise the
whether their affairs are being managed in Government to issue directives to the
accordance with sound business public corporation on the matters of
principles and prudent commercial policy. For example, the Life Insurance
practices. Corporation Act, 1956 provides that in
The recommendations of the the discharge of its functions under this
Committee are advisory and therefore, not Act, the Corporation shall be guided by
binding on the government. However, by such directions in matters of policy
convention, they are regarded as the involving public interest, as the Central
recommendations of Parliament, and the Government therein shall be final.
government accepts them, and in case of non- Similarly, under the Damodar Valley
acceptance, the Ministry concerned has to give Corporation Act, 1948 the Central
reasons therefore. Government has been authorised to give
directions to the corporation with regard
C) GOVERNMENT CONTROL to its policy. The corporation is required
(MINISTERIAL CONTROL) to follow this direction. In practice, it is
Since Government is the custodian of very difficult to distinguish the matters of
public interest, it also exercises control and policy from day to day working of the
supervision over the affairs of public corporation and usually the Government
Corporations. However, government control has upper hand in deciding whether a
does not mean governmental interference in matter is of policy or not and, therefore,
the day-to-day working of the Corporation, by this method the public corporation
which is highly destructive of the idea of may effectively be controlled by the
autonomy necessary for the success of any Government
commercial or service undertaking. There is (2) Appointment and removal of
not any uniform pattern of governmental members:- Generally, the power to
control over all statutory public Corporations. appoint and remove the Chairman and the
However, there are various techniques of Members of a Public Corporation is
governmental control in the following shapes: vested in the Government by the
i. By issuing Directions to the Corporation. constituent statute. This is the
ii. Appointment and removal of members. mosteffective means of control over a

87
 pubic Corporation. rn some statutes, the (5) Rules and Regulations:- Usually the
terms of office of a member is left to be statute creating the corporation empowers
determined by the government. In some the Central Government to make rules to
case, the government is empowered to give effect to the provisions of the Act.
remove a member of the Corporation. Sometimes the corporation is empowereJ
(3) Order enquiries:- Usually the to make regulations with the prior
Government is given power to order approval of the Central Government. This
enquiries regarding the functions of the also helps the Government in controlling
public corporation. By this method the the public corporation.
misuse of the power by the corporation
can be brought into light and such misuse D) PUBLIC CONTROL
may be checked and suitable action may The public corporations are created for
be taken by the Government. The the benefit of public and to promote public
Government may appoint, through its interest. Their main aim is not to make profit
executive power, a committee or but to promote the public good. They are
commission to review the working of a required to manage their affairs in public
public undertaking. interest. They must respond to the opinion of
(4) Financial control:- The Government's the citizens. A balance between the
control over the financial matters relating accountability to the people and autonomy of
to the public corporation provides teeth to action should be maintained. Consequently,
the Governmental control of the public the mass media may playa significant role in
corporations. Generally, the Government controlling the public corporations. They may
is vested with the powers of controlling expose the corruption and inefficiency
the borrowing expenditure and capital prevailing in the management of the public
formation. For example, the Oil and corporations.
Natural Gas Commission Act, 1956 The Consumer Protection Act, 1986
provides that the Commission can borrow makes provisions for the establishment of the
money with the prior approval of the Central Consumer Protection Council and the
Central Government. Similarly, the State Consumer Protection Councils. The
Damodar Valley Corporation Act object of the Councils is to promote and
provides that the Corporation can borrow protect the rights of the consumer. The Central
money with the prior approval of the Council shall consist of the Minister-in-charge
Central Government. The statute creating of the Department of Food and Civil Supplies
the corporation may require the in the Central Government who shall be its
corporation to submit to the Government chairman and such other members as may be
its budget and program for the next year. prescribed. The State Consumer Protection
Council shall consist of such member or

88
members as may be prescribed by the State
Government. These Councils are expected to
be useful in controlling the public enterprises
including public corporations in the interest of
the consumers. They will be helpful in curbing
the growth of corrupt practices.

89
 Chapter – IX
SUITS AGAINST THE GOVERNMENT IN TORT AND CONTRACT, PRIVILEGES
IN LEGAL PROCEEDINGS

Articles 299 and 300 of the It means 'he who does an act through
Constitution deal with Government Liability another deemed in law to do it himself. When
or State Liability, which may be explained a person authorises another to perform an act
with reference of the following heads: and a tort is committed, while performing the
1. Tortious Liability of the State (Article 300); act, the former is liable as if he had committed
2. Contractual Liability of the State (Article it himself'.
299). 2. Respondent Superior
I. TORTIOUS LIABILITY OF THE It means 'let the Superior (Principal)
STATE (Art. 300) be liable'. 'If the liability is imposed on a
Tortious Liability of the State means superior/stronger man ignoring the weaker
'Liability of the State/ Government for the torts man, the injured party/aggrieved would get
committed by its servants'. 'Tort' means a civil appropriate remedy.
wrong causing injury or damage to another Position in England
(injured or aggrieved). The injury may be Earlier, the King (Crown) or the State
personal, physical, mental or otherwise and the in England enjoyed complete immunity (i.e.
injured party resorts to remedy by an action in not liable) for the torts committed by its
civil court. The remedy may be unliquidated servants. This immunity was given on the
damages or injunction or restitution of basis of the well-known maxim 'The King can
property etc. do no wrong'. In course of time, with the
In view of tremendous growth in increase in functions of the Government and
administrative functions, being discharged by expansion of the Governmental machinery,
the Government Servants, danger to another's such immunity was found to be impracticable
person or property may take place. Then the in the interests of justice and social security.
question arises is: whether the government or Consequently, the Crown Proceedings Act,
State is vicariously liable for the torts 1947 was passed, and the immunity was
committed by its servants? (Vicarious liability withdrawn. According to Section 2(1) ofthe
means 'liability of one person for the tort Act, the Crown is vicariously liable like an
(wrong) committed by another). ordinary individual or any other employer for
Underlying Principle the torts committed by the servants.
The doctrine of vicarious liability is Position in India
based on the following two maxims: Indian Parliament has not passed any
1. Qui facit per alium facit per se Act like the Crown Proceedings Act,

90
prescribing the tortious liability of the Sovereign and Non-sovereign Dichotomy:-
Government/State. However, Article 300 of Peacock, C.J. made a distinction between
the Indian Constitution lays down the sovereign power and non-sovereign power in
provisions relating to the liability of the the leading case of:
Government/State for the torts committed by P & O Steam Navigation Co. vs.
its servants. In India also, the Government/ Secretary of State for India 120, in this case, the
State is vicariously liable for the torts plaintiff's servant was travelling in a carriage,
committed by its servant. driven by two horses through the Kidderpore
Article 300(1) of the Constitution Dockyard. Due to the negligence of the
provides that the Government of India may be defendant (Dockyard's) servant, an iron rod hit
sued in relation to its affairs in the like case as the plaintiff's servant and the horses and they
the Dominion of India, subject to any law, were injured. In an action by the plaintiff, the
which may be made by Act of Parliament. defendant Company pleaded immunity on the
However, the position and extent of liability is ground that they were engaged in ship repair
not clear (uncertain) due to lack of proper process, managed by the East India Company
legislation. Whenever such situation to to which sovereign power were accorded. But,
prescribe State/Government liability arises, the Peacock C.J. did not agree with the contention
Courts traced back to pre-constitutional period and held the defendant liable.
and followed sovereign, non sovereign There is no test or definition to
dichotomy, enunciated in 1861 in P & 0 Steam distinguish between sovereign and non-
Navigation Case119. sovereign function. However, those functions,
Sovereign Immunity which can alone be undertaken by the
'Sovereign Immunity' means "exemption State/Government viz. Army, navy, air-force,
(immunity) from liability on the ground of Administration of Justice, Law and Order etc.
being sovereign". The State or Government is are regarded as sovereign functions. There are
not vicariously liable for the torts committed some other functions like trade, commerce,
by its servants (enjoys sovereign immunity) roads and buildings, transport, communication
provided the following conditions are satisfied. etc. may be delegated to any private person or
1. The tort is committed by the servant in an agency, and hence, they are regarded as
discharge of duty or obligation imposed non-sovereign functions.
on him by law. Position of State/Government Liability after
2. Discharge of such duty, must be in the Constitution of India
delegation of sovereign power. Even after the Constitution of India
Now, the question is what is sovereign came into force, the courts followed sovereign,
power? And what is non-sovereign power? non-sovereign dichotomy in many cases in

119 120
(5 Born. H.C.R. Appl. 1) . (1861) 5 Born. H.C.R. App. 1,

91
spite of the Supreme Court's decision in case of Hindustan Lever Limited vs. State of
Vidyavathi's case 121 in this case Vidyavathi's Uttar Pradesh.124
husband died of an accident having knocked Gross negligence by the Servant
down by a Collector's jeep on official trip. On The Government/State is vicariously
appeal, the Supreme Court through Sinha C.J. liable for the gross negligence of its servants.
held the State liable without taking into In Ramakonda Reddy vs. State125 the A.P High
consideration, the Sovereign, Non-Sovereign Court held the State liable to pay
Dichotomy. compensation. In this case, an under trial
In spite of the Supreme Court's prisoner died due to negligence of the prison
decision in Vidyavathi's Case, the position as authorities. The Court viewed that the
to the liability of the Government/State is not sovereign immunity could no longer be
certain! clear. Following cases illustrate on applicable in cases for violation of the right to
this point: life and personal liberty guaranteed under
Kasturilal vs. State of Uttar Pradesh122, Article 21 of the Constitution.
in this case, Kasturilal's gold was seized by the Existing position in India and the Role of
police under the suspicion that it was the Judiciary
stolen property. The gold was kept in the The existing position in India with regard
Police Malkhana under the custody of a Head to the Government Liability is not certain.
Constable. He misappropriated the gold and Hence, Gajendra Gadkar C.J. in
fled to Pakistan. In an action by Kasturilal Kasturilal's_case expressed dissatisfaction
against the State for recovery of the Gold or its over the lawlessness in respect of the State
equivalent value, the trial court dismissed the Liability. However, the judiciary by exercising
suit. On appeal, the Supreme Court upheld the its discretionary power, removed the
Trial Court's decision following the rule of uncertainty in the following cases:
Sovereign; non-sovereign dichotomy laid 1. Rudul Shah vs. State of Bihar (AIR 1983
down in P & 0 Steam Navigation Case. SC 1086).
The above rule was followed by the 2. Bhim Singh vs. State of J & K (AIR 1986
Supreme Court in: State of Uttar Pradesh vs. SC 494).
Tulasi Ram123, it is to be noted that to plead 3. Sebastian M. Hongray vs. Union of India
the immunity both the conditions stated above (AIR 1984 SC 1026).
are to be satisfied. If either of the two 4. Saheli, A Womell S Resource Center vs.
conditions is absent, the State is liable as in the Commissioner of Police, Delhi (AIR 1990
SC 513).
5. In Rudul Shah s Case, an acquitted person
121
. State of Rajasthan vs. Vidyavathi, AIR 1962 SC
was detained in prison for more than 14
933
122 124
. AIR 1965 SC 1039 . AIR 1972 All. 486.
123 125
. AIR 1971 All. 162 . AIR 1989 AP 235

92
 years. The Supreme Court directed the enters into variety of contracts with the
State to release him immediately and individuals and other agencies. In such
awarded exemplary damage of situations, state as a party to the contract, is
Rs.35,000/- subject to the same contractual obligations,
6. In Bhim Singh s Case, he was awarded rights and liabilities. However, the State in
Rs.50,000/- as exemplary damages (by implementation of the welfare measures,
the Supreme Court) for unlawful deserves certain privileges and immunities.
detention. Government Contract
7. In Sebastian's Case, two persons were A contract entered into with/by the
taken to military camp by the army Government/State must fulfill the essentials of
jawans. The Government failed to a valid contract under Sec.10 of the Indian
produce them before the Court. The Contract Act, 1872, and also the conditions/
Supreme Court awarded exemplary provisions enshrined under Art.299 (1) of the
damages of Rs.1,00,00/- each to the wives Indian Constitution. Therefore, a Government
of the said two persons for having contract to be valid the following conditions
undergone torture, mental agony etc. are to be satisfied.
8. In Saheli s Case, a child of 9 years was 1. Essentials of a valid contract under Sec.10
beaten to death by the Police. The of the Indian Contract Act, 1872; and
Supreme Court awarded a compensation 2. The provisions under Art.299 (1) of the
ofRs.75,000/- to the mother of the child. Indian Constitution.
The Government (Liability in Tort) Bill, Article 298 of the Indian Constitution
1967:- In view of uncertainty as to State empowers the Union of India and States to
Liability, due to lack of proper legislation, carry on any trade or business by entering into
the Law Commission recommended the contracts through its executive power.
legislation enshrining various provisions Historical Baekground
relating to State Liability. Consequently a In England, the Crown (State/
bill entitled 'The Government (Liability in Government) enjoyed immunity (exemption)
Tort) Bill, 1967 was introduced in Lok from liability on the ground of a well known
Sabha in 1969. But it has not yet been maxim 'The king can do no wrong'. However,
passed into law. such immunity was never enjoyed by the
Crown in respect of Contractual Liability.
II. CONTRACTUAL LIABILITY OF THE In Bank of Bengal vs. The United
STATE (Art. 299) Company (1831) - The Government (East
A modem welfare State is shouldered India Company) was held liable for the
with the responsibility of implementing contractual liability.
various schemes for the welfare of its citizens. But the Government/State was held
In this connection, the State/Government not liable for contractual liability on the

93
ground of Sovereign Power in Nobin Chunder be in writing and the oral contract is not
vs. Secretary of State (1875) - In England, the enforceable.'
Crown Proceedings Act, 1947, abolished The Government contract to' be valid,
sovereign immunity and held the Government no formal agreement is essential. In Union of
liable like an employer or an ordinary India vs. [Link] Ram 126 , the defendant
individual. In India, according to Sec.79 of the Government servant, the Chief Director of
Civil Procedure Code, 1883, the Government Purchase issued tenders for purchase of certain
is liable in contract like a private individual. quantity of cigarettes and the plaintiff's tender
Constitutional Provisions (quotation) was [Link] and signed by the
Art.298 of the Constitution empowers Chief Director. But, no formal agreement was
the Government (Union of India and the entered into for the purchase. The plaintiff
States) to carry on any trade or business by sued the Government for specific performance
entering into contracts through its executive of the contract. The defendant (Government)
power. contended that the contract was not
Article 299 (1) lays down the procedure enforceable since there was no formal
for entering into contract by/with the agreement. The Supreme Court denied this
Government. Accordingly, the contract contention and held in favour of the plaintiff
with/by the Government to be valid, the that the contract was enforceable.
following conditions are to be satisfied: 1. The contract must be in the name of the
1. The contract must be expressed to be President or Governor:- The Government
made by the President or the Governor as contract to be valid and binding, it must
the case may be. be made in the name of the Governor in
2. Such contract must be executed by the case a contract by the State .and the
person authorised by the President or President in case a contract by the Union
Governor as the case may be . of India.
3. The contract must be executed on behalf 2. Person Authorised:- The Government
of the President or the Governor as the contract to be valid, it must have been
case may be. entered into by the person so authorised
Earlier, the above rules were strictly by the President or Governor as the case
followed to safeguard the interests of the may
Government. In course of time, strict Such authority may be expressed or
adherence to .the above conditions became implied.! A contract under an implied
impracticable. In the interests of the parties authority is valid and enforceable as in the
contracted with the Government, Courts case of: Bhikraj Jaipuria vs. Union of
liberalised the strict compliance of the above India, AIR 1962 SC 113 - A Contract for
rules. However, the Government contract must
126
. AIR 1963 SC 1685

94
 supply of large quantity of food grains This view was followed in D. G.
was entered into between the plaintiff and Factory vs. State of Rajasthan128, and Punjab
the defendant Government's servant, the vs. OPB.Krishnan129.
Divisional Superintendent, Eastern
Railways. But, there was no express Article 299 (1) - Mandatory and no
authority to the Divisional Superintendent Ratification
to enter into such contract. The plaintiff For the validity and enforceability of a
supplied the food grains and the same was contract entered into with/by the Government,
distributed to the employees, and a part of the provisions of Article 299 (1) of the
the amount also was paid. In an action for Constitution are to strictly complied with and
payment of the balance, the defendant are mandatory. Any contract, violating these
Government was held liable, on the provisions is defective, and cannot be ratified
ground that the Divisional Superintendent by the Government (as laid down in Mulchand
had an implied authority to enter into the vs. State of Madhya Pradesh).
contract.
3. On behalf of the President or the No personal liability to the
Governor: The Government contract to be Governor/President (Art.299 (2)
valid, it must have been entered into by Article 299 (2) protects the President
the person so authorised on behalf of the and Governor from personal liability arising
President or Governor as the case may be out of such contracts.
and it must be made in the name of the
President or Governor as the case may be. III. PRIVILEGES AND IMMUNITIES OF
Otherwise, it is not valid. GOVERNMENT IN LEGAL
Karamshi vs. Bombay127, in this case, PROCEEDINGS
an agreement for supply of canal water (GOVERNMENT PRIVILEGES)
for irrigation purposes was entered into The word privilege literally means 'a
between the plaintiff and the P.W.D. special right/benefit or advantage conferred by
Minister, through some letters. But, there virtue of one's position'. The expression
was no formal agreement to that effect i.e. 'Government privilege' in the present chapter
in the name of the Governor. The denotes immunity (exemption from liability)
Supreme Court held the contract void, and of the Government from judicial proceedings.
not enforceable. Earlier, state was not liable for the
torts committed by, its servants. This
immunity from tortious liability was enjoyed
by the state under the doctrine 'The king can

128
. AIR 1971 SC 141
127 129
. AIR 1964 SC 1714 . AIR 1988 SC 2149

95
do no wrong'. The immunity enjoyed by the 2. Privilege to withhold documents Under
state is called' Sovereign Immunity'. Now the Section 123 of the Indian Evidence Act
state is regarded as any other employer and is 1872.
vicariously liable for the torts committed by its 3. Immunity from the Operation of Statutes;
servants subject to certain conditions. and
Position in England 4. Immunity from Estoppel.
Earlier, the king or the state enjoyed 1) Privilege as to Notice Under Section 80
immunity from tortious liability. 'With the (1) of the Code of Civil Procedure 1908
increase in functions of the state and Section 80 (1) of the Code of Civil
expansion of the Government Machinery, such Procedure 1908 provides that no suit shall be
immunity is not possible in the interests of instituted against the Government or against a
justice. Hence, the British Parliament enacted public officer in respect of any act purporting
'the Crown Proceedings Act, 1947' which to be done by such public officer in his official
provides for Government liability. capacity, until the expiration of two months
Position in India next after notice in writing has been delivered
There is no enactment like the Crown in the manner provided in the section. This
Proceedings Act prescribing tortious liability section is mandatory and admits of no
of the State. However, Art.300 of the Indian exception. Thus, the requirement of notice is
Constitution lays down the provisions relating mandatory. However, it is to be noted that if a
to the liability of State or Government for the public officer acts without jurisdiction, the
torts committed by its servants. In India, the requirement of notice is not mandatory. Its
state or the Government is vicariously liable object appears to provide the Government or
like an individual or an employer in respect of the public officer an opportunity to consider
the torts committed by its servants. However, the legal position thereon and settle the claim
the existing position in India is not without litigation.
satisfactory. The Government may waive the
GOVERNMENT PRIVILEGES requirement of notice, the waiver may be
As stated above, in public law litigation, express or implied.
the principles and rules of law, which are The requirement of notice causes
applicable to an individual are also applicable much inconvenience to the litigants specially
to the Government as a party to the legislation. when they seek immediate relief against the
However, there are certain circumstances, Government. State of Orissa vs. Madan Gopal,
some privileges and immunities are granted to AIR 1952 SC 12, may be mentioned to
the Government in a litigation as stated illustrate the difficulties created by this rule. In
hereunder: this case, the Government notified to the
1. Privilege as to Notice Under Section 80 lessees of mines that their leases had become
(1) of the Code of Civil Procedure 1908. void. The lessees were directed to remove their

96
assets within a fortnight. The lessees wanted to required to be given in case the suit is filed
file a suit for injunction but the rule of against the statutory Corporation.
compulsory notice created difficulty and Section 80 does not apply with respect
therefore they filed a petition for the issue of to a claim against the Government before the
the writ of Mandamus. The High Court claim Tribunal under the Motor Vehicles Act.
granted the said writ on the ground that the Section 80 of the C.P.C. does not
alternative remedy available to the petitioners apply to a writ petition against the
was not adequate and directed the State Government. Therefore, m case a writ petition
Government that it should not disturb the is filed against the Government or a public
possession for three months, during which the officer, the requirement of notice as provided
petitioners could file suit after complying with under Sec.80 of the C.P.C.. is not required to
the requirement of the notice as provided be complied with.
under Sec.80 of the C.P.C. But the decision of Section 80 of the [Link] provides
the High Court was reversed by the Supreme privilege to the Government. According to this
Court on the ground that it was erroneous. section, where in a suit by or against the
The Law Commission has also Government or by or against a public officer a
recommended the abolition of this rule decree is passed against the Government or the
because it causes great inconvenience to the public officer, a time shall be specified in the
litigants especially when they seek immediate decree within which it shall be satisfied and if
relief against the Government. the decree is not satisfied within the time so
To minimise the hardships to the specified and within three months from the
litigants, a new Clause (2) was inserted in date of the decree, where no time is so
Sec.80 of the C.P.c. by the Civil Procedure specified, the Court shall report the case for
Code Amendment Act, 1976. The clause the orders of the Government. Thus, a decree
provides that the Court may grant leave to against the Government or a public officer is
person to file a suit against the Government or not executable immediately. The Court is
a public officer without serving the two required to specify the time within which the
months' notice in case where relief claimed is decree has to be satisfied and where no such
immediate and urgent. Before granting this time has been specified, three months from the
exemption the Court is required to satisfy itself date of the decree will be taken to be the time
about the immediate and urgent need. within which it is to be satisfied. If the decree
It is to be noted that Sec.80 of the is not satisfied within such time limit, the
c.P.C. does not apply to a suit against a Court shall report the case for the orders of the
statutory Corporation. Consequently, in case Government.
the suit is filed against the statutory
Corporation. Consequently, such notice is not

97
2) Privilege to withhold documents Under disclosure. For this purpose the
Section 123 of the Indian Evidence Act, communication which is required to be
1872 disclosed must have been made to the public
Section 123 of the Indian Evidence officer in public confidence. The Court has
Act, 1872 provides that no one shall be power to decide as to whether such
permitted to give any evidence derived from communication has been made to the officer in
unpublished official records relating to any official confidence. For the application of
affair of State, except with the permission of Section 124, the communication is required to
the officer at the HEAD OF THE Department have made to a public officer in official
concerned who shall give or withhold such confidence and the public officer must
permission as he thinks fit., Only those records consider that the disclosure of the
relating to the affairs of the State are communication will cause injury to the public
privileged, the disclosure of which would interest.
cause injury to the public interest. To claim Position in England
this immunity, the document must relate to Sec.123 of the Evidence Act is based
affairs of State and disclosure thereof must be on the English principle that the Crown has the
against interest of the State or public service privilege not to produce any document if the
and public interest must be so strong as to disclosure will affect public interest. In
outweigh the private or any other interest. For Duncan VS. Cammell Laird and Co. Ltd.
the application of this section there must be Case 130 , the submarine 'Thetis' sank during
unpublished official record relating to the trial run and ninety-nine people on board died.
affairs of the State and attempt by someone to The dependants of the deceased filed a suit for
give evidence derived from such records. In compensation against the contractor who built
such conditions, such evidence cannot be the ship on the ground of negligence. The
permitted to be produced except with the plaintiffs asked the contractor to produce
permission of the officer at the Head of the certain documents concerning the design of the
Department concerned. The Head of the submarine. The Minister filed an affidavit
Department can give or withhold such claiming privilege on the ground that the
permission. He has been given discretion in production will affect public interest. The
this matter. Court held that the Minister's affidavit cannot
The privilege extends to the be challenged. If the Minister claims certain
confidential official communication under document as confidential and the production
Sec.l24 of the Indian Evidence Act. Section will affect the interest is of the public then that
124 provides that no public officer shall be claim is conclusive. The Court observed that
compelled to disclose communication made to the test of public interest is (1) by having
him in official confidence when he considers
that the public interest would suffer by the 130
. 1942 AC 624

98
regard to the contents of the document in was held that the Court cannot look into the
question, or (2) by the fact that the document document having reference to the affairs of the
belonged to a class which must be withheld on State. It can see only the validity of the
the ground of public interest. objection. It was further held that the minutes
The above decision was overruled by of the meeting of the Council of Ministers
the House of Lords in the case Conway VS. need not be produced. The reason was that it
Rimmer, 1968 1 AllER 874 - In this case one would affect the freedom of expression of the
police constable sued the superintendent of ministers while carrying out the policies of the
police for malicious prosecution. The plaintiff Government.
demanded the production of certain documents The decision in Conway v. Rimmer
before the court. The department claimed influenced the Indian courts also. The courts
privilege. The court declared that the statement were not ready to follow the decision in
by a minister cannot be accepted as Sukhdev Singh's case in its later decisions. In
conclusive. The Court can decide whether the State of Kerala vs. Midland Rubber Produce
production is injurious to public interest or not. Co., Case132 the High Court rejected the claim
The decision in Conway case is the law in of privilege after examining the documents.
England with regard to the privilege of the Referring to Conway case it was held that the
Crown to withhold documents. court can see whether the disclosure will affect
Position in India public interest or not. Similarly in Indira
The scope of Sec.123 of the Evidence Gandhi vs. Raj Narain Case,133 the Supreme
Act was examined by the Supreme Court in Court disallowed the claim of privilege not to
Punjab v. Sodhi Sukhdev Singh Case 131 , the produce the Blue Book. In s.p Gupta vs. Union
respondent, who was a district judge was of India Case,134 the Supreme Court held that
dismissed from service. He made a the government cannot claim privilege with
representation against his removal. After regard to the production of certain reports. The
consulting the Public Service Commission, the law provides that the chief justice of the High
Government decided to appoint him in some Court and the Supreme Court must be
other post. This was challenged before the consulted by the Law Minister with regard to
Court. The plaintiff demanded the production the appointment of an additional judge. Here
of the minutes of the Cabinet meeting. the question was whether these reports are to
The Government claimed privilege on be produced before the Court or not. The court
the ground that it will be injurious to public held that no privilege can be claimed.
interest. But it can make a preliminary inquiry
whether the production of the document
involves a question of public interest or not. It
132
. AIR 1971 Ker. 228
133
. AIR 1975 SC 2299
131 134
. AIR 1916 SC 49 . AIR 1982 SC 149

99
3) Immunity from the operation of statutes happens to become the owner of the said land.
In England the Crown enjoys the Then A cannot set aside the sale on the ground
privilege that it is not bound by a statute unless that he did not have title at the time of the
it is expressly provided. This law was accepted contract for sale. In other words, A cannot
in India also. In Director of Rationing vs. estop B for execution of the contract of sale.
Corporation of Calcutta Case, 135 the Calcutta When a person by declaration (act or
Municipal Act 1923 prohibited storing rice, omission) makes/induces another to believe a
flour, etc. without a license. The Director of thing, he cannot deny its truth subsequently.
Rationing was sought to be prosecuted for The other person cannot be estopped from
storing these commodities without a license. proceeding upon such declaration. Estoppel is
The question here was whether the State was a rule of evidence, by which a person is not
bound by the statute. The Supreme Court held allowed to plead the contrary of a fact or state
that the state would not be bound by a statute of things, which he has formally asserted as
unless it was laid down expressly. It was existing.
observed that the old common law principle is Section 115 of the Evidence Act embodies
adopted in Indi;] But the above decision was the principle of Estoppel.
overruled by the Supreme Court in the case of It runs as follows:
Superintendent and Remembrancer of Legal When one person has, by his declaration, act
Affairs, West Bengal vs. Corporation of or omission, intentionally caused or permitted
Calcutta Case,136 the Court held that the state another person to believe a thing to be true and
is bound by the statute unless it is expressly to act upon such belief, neither he nor his
exempted. representative shall be allowed, in any suit or
proceeding between himself and such person
4) Immunity from Estoppel or his representative, to deny the truth of that
Meaning & Definition thing.
The expression Estoppel is derived Basis, object and underlying principle
from the French word 'Estoup' which means, The principle of estoppel is based on
"shut the mouth". When a person tells us the principle of equity and good conscience.
something, we generally hear him. If he says The object of the principle of estoppel is to
something different or contradicting, we would prevent fraud and to manifest good faith
not hear any more, and contradict such amongst the parties. This principle is
statement. Otherwise, we shall comply with' enshrined in the maxim 'Allgans Contraria
E.g.: A, intentionally and falsely tells B that, Non Est Audiendus'. It means, "a man alleging
he is the owner of certain land and induces contradictory facts ought not to be heard".
him (B) to purchase and pay for it. Later, A Immunity from Estoppel
The administrative authority is vested
135
. AIR 1960 SC 1355
136
. AIR 1967 SC 997 with large discretionary powers. As a result the

100
Government may make some prior promissory estoppel against the Government.
pronouncement of its policies or it may give The Central Government notified in the
some advice or promise to an individual. The Gazette an export promotion scheme under
question here is whether the Government is which an exporter will be entitled to import
bound by those pronouncements or promises. raw materials equal to the amount, which is
In other words whether the rule of estoppel is exported. The petitioner exported 5 lakh
applicable to the government or not. rupees worth of goods, but he was given
Estoppel means that a party is import license for an amount below 2 lakh
prevented from denying the existence of some rupees only. This was challenged before the
facts, which he had previously admitted and on court. The Court held that the Government is
which the other party had relief or entitled to bound to keep its promise and the petitioner is
rely. In India the courts reluctant to apply the entitled to get the benefit of the scheme. This
rule of estoppel against the Government, case is considered to have created a new
formerly. There are so many cases to assert the judicial trend. The above decision was
above point. In Amer Singh vs. Rajastan followed in Motilal Padampat Sugar Mills vs.
Case, 137 the Supreme Court refused to apply U. P. Case,140 the Government assured through
the principle of estoppel. Here the petitioner newspapers that the Government will give tax
argued that the Collector had made certain exemption for three years to new industrial
promise that the petitioner's jagir would not be units. Later the Government retreated from its
taken during his lifetime. The Court held that earlier assurance. The court held that the
the Government cannot be estopped on the Government was bound by its assurance. But
ground of the promise made by the Collector. the effect of the above decision was diluted by
Similarly in Sankaranarayan vs. Kerala the Supreme Court in lit Ram Siv Kumar vs.
Case, 138 the Supreme Court refused to apply Haryana Case, 141 a municipality resolved not
the principle of promissory estoppel. Here the to collect octroi duty on certain items. Later it
Government extended the age of retirement on changed its mind and levied octroi. The court
the basis of an agreement between the held that the municipality could not be
Government and the employees. But again the estopped because the decision not to levy
retirement age was lowered through another octroi was ultra vires its power. In M.P vs.
142
ordinance. Held that the power under Art.309 Orient Paper Mills Ltd., Case, - The
cannot be curtailed by applying the principle Government was held to be bound by its
of estoppel. assurance to grant electricity duty exemption
In India vs. Anglo Afghan Agencies on the basis of the principle of promissory
139
Limited Case, the Supreme Court applied estoppel.

137 140
. AIR 1965 Raj 160 . AIR 1979 SC 621
138 141
. AIR 1971 SC 1897 . AIR 1980 SC 1285
139 142
. AIR 1968 SC 718 . AIR 1990 SC 176

101
Promissory Estoppel post of Lecturer. Appellants pleaded that the
The rule of 'Promissory Estoppel' is State Government had assured that they would
recognised by the courts of Equity in England. be promoted to the post of lecturer. The
It is also known as 'Requisite Estoppel' or contention was rejected on the ground that
'New Estoppel'. It does not come within the there could be no promissory estoppel against
meaning of Sec. 115 of the Evidence Act. It provisions of law.
relates to future promises (Sec. 115 relates to Burden of proof
existing facts). Where a person makes a Burden of proving estoppel lies upon
promise to another thereby induces him to do the party who claims estoppel. He has to prove
an act to alter his position; the person the ingredients of Section 115 of the Evidence
promised is estopped from denying the truth of Act for this purpose.
that promise.
The concept of promissory estoppel
was involved for the first time in India in the
case of: M.P. Sugar Mills v. State of UP
Case, 143 in the instant case, the Government
through the Chief Secretary announced
categorical assurance for total exemption from
Sales Tax. Basing on this promise, the
defendant set up a hydro generation's plant by
raising huge loan. Later, the Government
changed its policy and announced the
exemption of Sales Tax @ 3%, 2.1/2% and 2%
for the 1st, 2nd and 3rd years respectively. The
Tax exemption was completely withdrawn
later, when the defendant's factory started its
production. The Supreme Court held that the
Government was bound by its promise and
directed to give exemption to the defendant's
company.
In Ashok Kumar Maheswari vs. State
of UP Case, 144 there was provision for only
direct appointment to the post of Lecturer in
Medical College. There was no avenue for
promotion from the post of demonstrator to the

143
. AIR 1979 SC 621
144
. AIR 1998 SC 966

102
 Chapter – X

THE CONCEPT OF OMBUDSMAN, OMBUDSMAN IN INDIA –

THE LOKPAL AND LOKYKTA

The necessity of ombudsman wrong decisions maladministration or

The concepts of ombudsman arise or corruption of public official.
developed due to the inadequacy of judicial The government finds the following
control over the administration. E.g. Sir John alternatives.
Whyatt in his book ‘International Commission The Conseil d’Etat under the French system of
of Jurists’ (1962) said that the opportunity & Droit Administratuf, it Administrative
scope for judicial review of administrative judiciary provide for bringing all
decisions is very meager except in the few Administration Authority before it therefore
cases where there is statutory provision for an conseil d’Etat. It is not judicial body, it
appeal to an administrative tribunal. composed of experienced member of the civil
Also in the sphere of constitutional service, and it has got both Advisory &
protection in form of judicial review is limited Judicial power it can quash an administrative
as it only ensuring the minimum standard of decision & award compensation to the
justice or fair hearing & there is no means of aggrieved citizen. It has not only power to
correcting an erroneous decision on facts or advise the government on question of policy &
investigating into complaints of misconduct Administration in general but also to entertain
inefficiency, delay, negligence or the like complaints against the administration directly
against official. from the aggrieved citizen.
In such a cases only remedy to an Procedure
aggrieved citizen is to persuade the concerned On receipt of complaint the conseil can
minister if he is accessible or to draw his require the official or minister to Justify his
attention by raising question in parliament to act.
which he is responsible. But this is also very This conseil not only see the
difficult to recourse this remedy as it is very administration observes the highest standard of
difficult to private person to bring motion of behavior but also to see whether they arrive at
confidence against such minister or as he a 1) correct decision or 2) reasonable decision
belongs to majority party it is difficult to 3) observe fair & formal procedure.
inquire against him for misconduct or any Therefore if the Administrative Authority
other charges. fails to satisfy any of above standard the
Thus as above two system i.e. Judicial conseil may quash it and award compensation
review & party system of tradition pattern to the citizen aggrieved.
failed to provide relief to aggrieved to think of
alternative or additional institution to control

103
Office of Ombudsman I. Position of ombudsman in England
The other alternative is the Swedish Franks committee rejected the
system of ombudsman i.e. the grievance man suggestion to introduce the French system of
or a commissioner of the administration. ‘droit admistratif’ & suggested for the
Difference between Conseil d’Etat & appointment of a parliamentary commissioner
Ombudsman of the Scandinavian type, which had initially
Sr. been made by jurist, but eventually the office
Ombudsman Conseil d’Etat
No.
of the parliamentary commissioner for
1. He has not reviews He has power to
administration has been created by Legislation,
all the review all the
namely, the parliamentary commissioner Act
Administrative Administrative
1987.
Authority and also Authority and
Status
not having power also not having
Independent like the comptroller &
to enforce its power to enforce
Auditor General & has got statutory powers.
decision its decision
Appointment
2. He has having He has not only
By crown & cannot be dismissed
independent having
except by a motion in parliament.
advisory authority independent
advisory but also
Salary
judicial authority.
The salary & pension are charged on
3. He cannot quash He can quash as
the consolidated fund.
not enforce its own well as enforce
He is an ex-officio member of the
decision. his own decision.
council on Tribunals, set up under the
4. He only makes He can make
Tribunals & Inquiries Act 1958.
investigation & investigation &
Power.
give take action on its
To entertain any complaint of a
recommendation own.
subject as regards his relationship with the
for action to the
Central Government. The commissioner can’t,
Parliament.
however entertain a complaint direct from a
citizen; it must come through a member of the
The office of ombudsman was set up
House of Commons.
in Sweden over one & a half century ago
In following matter he has not power to
(1809) & that’s why then it has been adopted
entertain the complaint.
in many countries like Finland (1919),
1) Diplomatic Affairs.
Denmark (1954), Norway (1960), New
2) Foreign Diplomatic Affairs.
Zealand 1962), Mauritius (1966) Guyam
3) Matters affecting the security of the state
(1966) & U. K. (1966).
or

104
4) Personnel in the civil service 2) Due to expansion of range of government
5) Personnel from Armed forces. activities most of which are discretionary
6) Investigation of crime & the institution of judicial review &
7) A matter, which is justifiable & redress Parliamentary control become inadequate.
through the courts is available. Therefore the institution of ombudsman
Procedure. considered by the commissioner as an
The procedure before the easy, quick & inexpensive machinery for
commissioner is informal, but he can call for the redress of individuals grievances of
oral or documentary evidence from any body the citizens, in the light of the experience
except cabinet documents & he can take of other countries.
evidence on oath. While setting such institution in India
If anybody refuse to comply order of the commissioner suggested following points
commissioner he cannot punish but this refer must be considered as well -
for consideration of the High Court. 1) He should be independent & impartial.
Jurisdiction of commissioner 2) His investigation & proceedings should
It confined to faults in the be conducted in private & should be
Administration only & not any other. informal in character.
His jurisdiction extends to Ministers 3) His appointment as far as possible be
but certain matters excluded as above. non- political
Functions. 4) His status compare with highest judicial
His only functions to report to parliament functionary in the country.
& it are for parliament to decide what 5) He should deal with matters in the
action should be taken on his report & not discretionary field involving acts of
the commissioner. injustice, corruption or favoritism.
II. Position in India 6) His Proceedings should not be subject to
In India the creation of the office of a judicial interference & he should have the
Lokpal similar to that of ombudsman, which maximum latitude & powers in obtaining
was recommended by the Interim Report of information relevant to his duties.
Administrative Reforms Commissioner (1966 7) He should not look forward to any benefit
– By Morarji Desai) for the following reasons or pecuniary advantage from the
- executive government.
1) As India having Democrat form of OMBUDSMAN IN INDIA -
Government therefore it has an obligation LOKPAL AND LOKAYUKTAS UNDER
to satisfy the citizens about its functioning THE LOKPAL AND LOKAYUKTA
& to offer them adequate means for the ACT, 2013
ventilation & redress of their grievances. Maladministration is like a termite that
slowly erodes the foundation of a nation. It

105
hinders administration from completing its bodies/organizations and for other related
task. Corruption is the root cause of this matters.
problem that our country faces. Though there Origin and History
are many anti-corruption agencies in India, The story of the Lokpal and the
most of these anti-corruption agencies are Lokayukta has a long story. Lokpal and
hardly independent. Even the CBI has been Lokayukta is not Indian origin concept. The
termed as a “caged parrot” and “its master’s concept of ombudsman originated in 1809
voice” by the Supreme Court of India. with the official inauguration of the institution
Many of these agencies are only of Ombudsman in Sweden. Later in the 20th
advisory bodies with no effective powers to century, after the Second World War, the
deal with this evil of corruption and their institution of ombudsman developed and grew
advice is rarely followed. There also exists the most significantly. Countries like New
problem of internal transparency and Zealand and Norway also adopted the system
accountability. Moreover, there is not any of ombudsman in the year 1962. This system
effective and separate mechanism to maintain proved extremely significant in spreading the
checks on such agencies. concept of ombudsman to other countries
In this context, an independent institution of across the globe.
Lokpal and Lokayukta has been a landmark Great Britain adopted the institution of
move in the history of Indian polity which the Ombudsman in the year 1967, on the
offered a solution to the never-ending menace recommendations of the Whyatt Report of
of corruption. It provides a powerful and 1961. Through the adoption of such a system,
effective measure to counter corruption at all Great Britain became the first eminent nation
levels of the government. in the democratic world to have such an anti-
What are Lokpal and Lokayuktas? corruption institution. After great Britain,
The Lokpal and Lokayukta Act, 2013 Guyana emerged as the first developing nation
mandated for the establishment of Lokpal at to adopt the concept of the ombudsman in the
the Union level and Lokayukta at the State year 1966. Subsequently, this concept was
level. Lokpal and Lokayuktas are statutory further adopted by Mauritius, Singapore,
bodies and these do not have any Malaysia, and India as well.
constitutional status. These institutions In India, the former law minister
perform the function and role of an Ashok Kumar Sen became the first Indian to
“Ombudsman” (an official appointed to propose the concept of constitutional
investigate individuals’ complaints against a Ombudsman in Parliament in the early 1960s.
company or organization, especially a public Further, Dr. L. M. Singhvi coined the term
authority). They inquire into allegations of Lokpal and Lokayukta. Later in the year 1966,
corruption against certain public the First Administrative Reform Commission
passed recommendations regarding the setting

106
up of two independent authorities at the central into the Indian governance system. India rose
and at the state level. According to the into a nationwide protest for Lokpal. The
commission’s recommendation, the two “India Against Corruption” movement was led
independent authorities were appointed to look by Anna Hazare to exert pressure on the
into complaints against public functionaries, United Progressive Alliance (UPA)
including members of Parliament as well. government at the Centre.
After the recommendations from the The protests and the movement
commission, the Lokpal bill was passed in Lok resulted in the passing of the Lokpal and
Sabha in 1968 but lapsed due to the dissolution Lokayuktas Bill, 2013, in both the Houses of
of Lok Sabha. Since then, the bill was Parliament. The bill received assent from
introduced many times in Lok Sabha but has President on 1 January 2014 and came into
lapsed. Till 2011 as many as eight attempts force on 16 January 2014 under the name “The
were made to pass the Bill, but each of them Lokpal and Lokayukta Act 2013”.
failed. Lokpal and Lokayukta Amendment Act,
Before 2011, a commission, headed by 2016
M.N. Venkatachaliah, was also set up, in the After the introduction of the Lokpal
year 2002 to review the working of the and Lokayukta Act 2013, a bill was passed by
Constitution. This Commission recommended Parliament in July 2016 which amended the
the appointment of the Lokpal and Lokpal and Lokayukta Act, 2013. This
Lokayuktas. The commission also amendment enabled the leader of the single
recommended that the Prime Minister ought to largest opposition party in the Lok Sabha to
be kept out of the ambit of the Lokpal. Later in become a member of the selection committee
2005, the Second Administrative Reforms in the absence of a recognized Leader of
Commission chaired by Veerappa Moily came Opposition.
up with the recommendation that the office of This bill also amended Section 44 of the
Lokpal needs to be established without delay. Lokpal and Lokayukta Act 2013. Section 44 of
Though all these recommendations the Act dealt with the provisions of furnishing
were never given the due preference, the of details of assets and liabilities, within 30
government in 2011 formed a Group of days of joining the government service, of any
Ministers, chaired by the former President public servant. This amendment replaced the
Pranab Mukherjee. These groups of ministers time limit of 30 days. It stated that the public
worked to examine the proposal of a Lokpal servants will make a declaration of their assets
Bill and to suggest measures to tackle and liabilities in the form and manner as
corruption. prescribed by the government.
Not only the administration and the In the case where any non-
government but even the people of India felt governmental organization receives funds of
the need for such a system to be introduced more than Rs. 1 crore from government or

107
receives foreign funding of more than Rs. 10 experience of a minimum of 25 years in
lakh then the assets of the trustees and board matters relating to:
members were to be disclosed to the Lokpal. Anti-corruption policy; Public
The bill provided an extension to the time limit administration; Vigilance; Finance including
given to trustees and board members to declare insurance and banking; Law and management.
their assets and those of their spouses. Term and appointment to the oce of Lokpal
Structure of the Lokpal Lokpal Chairman and the Members
Lokpal is a multi-member body can hold the office for a term of 5 years or till
consisting of one chairperson and a maximum they attain the age of 70 years, whichever is
of 8 members. earlier. The members and the chairman of
The person to be appointed as the Lokpal are appointed by the president on the
chairperson of the Lokpal must be either: recommendation of a selection committee.
1. The former Chief Justice of India; or 1) The selection committee consists of:
2. The former Judge of the Supreme Court; or 2) The Prime Minister of India;
3. An eminent person with impeccable 3) The Speaker of Lok Sabha;
integrity and outstanding ability, who must 4) The Leader of Opposition in Lok
possess special knowledge and a minimum Sabha;
experience of 25 years in matters relating to: 1. 5) The Chief Justice of India or any
Anti-corruption policy; 2. Public Judge nominated by Chief Justice of
administration; 3. Vigilance; 4. Finance India;
including insurance and banking; 5. Law and 6) One eminent jurist.
management. The Prime Minister is the Chairperson
The maximum number of members of the selection committee. The selection of
must not exceed eight. These eight members the chairperson and the members is carried out
must constitute: by a search panel of at least eight persons,
Half members to be judicial members; constituted by the selection committee.
Minimum 50% of the Members should be Lokpal search committee
from SC/ ST/ OBC/ minorities and women. As per the Lokpal Act of 2013, the
The judicial member of the Lokpal Department of Personnel and Training needs
must be either: to create a list of candidates who are interested
A former Judge of the Supreme Court or; A to become the chairperson or members of the
former Chief Justice of the High Court. Lokpal. The list was then to be presented to
The non-judicial member of the the proposed eight-member search committee.
Lokpal needs to be an eminent person with The committee on receiving the list shortlists
flawless integrity and outstanding ability. The the names and place them before the selection
person must possess special knowledge and an panel, headed by the Prime Minister.

108
 The selection panel has discretion in person involved in act of abetting, Bribe
selecting the names from the list presented by giving or bribe-taking.
the search committee. In September 2018, a The Lokpal and Lokayukta Act states
search committee was constituted by the that all public officials need to furnish their
government which was headed by former assets and liabilities as well as their respective
Supreme Court judge Justice Ranjana Prakash dependents. The Lokpal also possesses the
Desai. The Lokpal and Lokayukta Act of 2013 powers to superintendence over the CBI. It
also mandates that all states must set up the also has the authority to give direction to CBI.
office of the Lokayukta within one year from If a case is referred to CBI by the Lokpal, then
the commencement of the Act. the investigating officer in such a case cannot
Jurisdiction and powers of Lokpal be transferred without the prior approval of the
The Jurisdiction of Lokpal extends to: Lokpal. The powers of a civil court have been
1) Prime Minister, vested with the Inquiry Wing of the Lokpal.
2) Ministers, The Lokpal also possesses powers
3) Members of Parliament, regarding the confiscation of assets, proceeds,
4) Groups A, B, C and D officers, receipts, and benefits arisen or procured by
5) Officials of Central Government. means of corruption in special circumstances.
The Jurisdiction of the Lokpal extends It also has the power to make
to the Prime Minister, except in the cases of recommendations regarding the transfer or
allegations of corruption relating to: suspension of public servants connected with
1) International relations; the allegations of corruption.
2) Security; Lokpal is capable of giving directions
3) The public order; to prevent the destruction of records during the
4) Atomic energy and space. preliminary inquiry.
The jurisdiction of the Lokpal does not Limitations
include ministers and members of Parliament The institution of Lokpal came up as a
in the matter relating to: much-needed change in the battle against
1) Any speeches delivered in the corruption. The Lokpal was a weapon to
Parliament or; curtail the corruption that was spreading in the
2) For a vote cast in the Parliament. entire administrative structure of India. But at
Lokpal’s jurisdiction also includes: the same time, there are loopholes and lacunae
Every person who is or has been in which need to be corrected. The appointing
charge (director/ manager/ secretary) of a body committee of Lokpal consists of members
or a society set up by the act of central from political parties that put Lokpal under
government, Any society or body financed or political influence.
controlled by the central government, Any There are no criteria to decide who is an
‘eminent jurist’ or ‘a person of integrity’

109
which manipulates the method of the governance”, should be followed in letter and
appointment of Lokpal. The Lokpal and spirit.
Lokayukta Act 2013 failed to provide any kind Moreover, Lokpal and Lokayukta must be
of concrete immunity to the whistleblowers. financially, administratively and legally
The provision related to the initiation of independent of those whom they are called
inquiry against the complainant, in cases upon to investigate and prosecute. Lokpal and
where the accused is found innocent, leads to Lokayukta appointments must be done
discouraging people from making complaints. transparently so as to minimize the chances of
One of the biggest lacunae is the exclusion of the wrong sorts of people getting in. There is a
the judiciary from the ambit of the Lokpal. need for a multiplicity of decentralized
The Lokpal does not have any institutions with appropriate accountability
constitutional backing. Also, there are no mechanisms, to avoid the concentration of too
adequate provisions for appeal against the much power in any one institution or authority.
actions of Lokpal. The states have complete *Features of the Lokpal
discretion with respect to the specific details in 1. Fact finding body.
relation to the appointment of Lokayukta. The It is purely a fact finding body, it has
need for functional independence of the CBI the only function to legislate in cases where
has been catered to some extent, by the change the government doesn’t voluntarily remove the
brought forth in the selection process of CBI’s defects pointed out would be to report to
Director, by the Lokpal and Lokayukta Act. parliament. It is the disadvantage over the
The Lokpal and Lokayukta Act also Swedish ombudsman, as he has power to
mandates that no complaint against corruption institute a suit against the concerned minister
can be registered after a period of seven years or state authority.
from the date on which the mentioned offense He has advantage over the English
is alleged to have been committed. parliamentary commissioner who cannot act
Thus in order to tackle the problem of except when a complaint received through a
corruption, the institution of the ombudsman member of parliament, while Lokpal can act
should be strengthened both in terms of on direct complaint.
functional autonomy and the availability of
manpower. The appointment of Lokpal in 2. This concept contrary to the principle
itself is not enough. The government should cabinet responsibility’
address the issues based on which people are The word maladministration is quite
demanding a Lokpal. Merely adding to the vague & wide, it may be due to faulty policy –
strength of investigative agencies will increase making as well therefore a person who is
the size of the government but not necessarily outside the cabinet if allowed or exercise his
improve governance. The slogan adopted by functions of other consideration, enquires into
the government of “less government and more question of policy then it will create

110
confliction between outside agency and also
undermine the principle of cabinet
responsibility.

3. Immunity from Judicial control

The one of the recommendations of
the commission regarding the office of Lokpal,
that, the proceeding before the Lokpal shall
not be subject to judicial interference. But it is
well accepted that such cases of other
administrative authority therefore aggrieved
person exclusion allowed only in cases of
inferior courts & not in cases of jurisdiction of
High Court & Supreme Court therefore High
Court & Supreme Court having the
supervisory jurisdiction over Lokpal, as in
may initiate the proceeding against Lokpal
before High Court or Supreme Court if he
refuses to exercise his statutory powers or
excess his jurisdiction.
If at all, he is immune by making
constitutional amendment then it will be a
patent breach of Rule of Law, which has been
characterized as a basic feature of our
constitution.

111