Administrative Discretion and Why It Is Conferred

6. Speed. In an emergency there is no time to seek fresh legislative authority.

The problem discretion creates

Against those reasons stands the objection stated at its sharpest by Dicey in [Rule of Law]: where there is discretion there is room for arbitrariness, and wide discretionary authority is the opposite of the rule of law.

The modern answer is not that Dicey was wrong about the danger but that he was wrong about the remedy. The remedy is not abolition, which would make government impossible, but confinement, structuring and checking.

• Confining discretion means the statute states its limits: the purposes for which it may be used, the matters to be considered, the maximum penalty.
• Structuring discretion means the authority publishes the criteria on which it will exercise the power, gives reasons, follows a settled procedure and keeps records. This is what administrative circulars do, as noted in [Sources of Administrative Law], and what section 4 of the Right to Information Act 2005 now requires.
• Checking discretion means judicial review, on the grounds in the next two chapters, and the internal and political controls in Module IV.

Discretion is never absolute

This is the proposition that governs the whole of Module III, and it has a constitutional source.

Facts. Maneka Gandhi v. Union of India, AIR 1978 SC 597, concerned a passport issued in June 1976 and impounded in July 1977 by an order under section 10(3)(c) of the Passports Act 1967 which recited only that it was done "in public interest". The petitioner was given no hearing, and when she asked for the reasons the Government declined to give them, saying it was not in the interest of the general public to do so.

Held. Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment: equality and arbitrariness are sworn enemies, one belonging to the rule of law in a republic and the other to the whim and caprice of an absolute monarch. The principle of reasonableness pervades Article 14, and the procedure contemplated by Article 21 must answer the test of reasonableness in order to conform to Article 14; it must be right and just and fair, and not arbitrary, fanciful or oppressive. The Passports Act does not provide for a hearing before impounding, but that is not conclusive, since even where a statute is silent the law may imply the principle and apply it. There is no distinction between a quasi-judicial function and an administrative function for this purpose.

Why it matters here. It is the reason discretion in India is never unfettered. Even where a statute says "in the opinion of the Government" and provides no criteria, Article 14 requires that the opinion not be arbitrary, and Article 21 requires a fair procedure where liberty is affected. A statutory formula cannot buy the administration freedom from those Articles.

Facts. Asif Hameed v. State of Jammu and Kashmir, AIR 1989 SC 1899, concerned admissions to the two government medical colleges of Jammu and Kashmir for 1988-89. In an earlier case the High Court had directed the State to entrust selection to a statutory independent body and, until then, to a body free from executive influence. The State constituted a Competent Authority by a 1987 procedure order. Unsuccessful candidates challenged the selection as violating those directions, and the High Court allowed the petitions and issued a mandamus.

Held. Although separation of powers is not recognised in absolute rigidity, the Constitution makers meticulously defined the functions of the organs, which must function within their own spheres. Judicial review is a powerful weapon to restrain unconstitutional exercise of power by the legislature and executive; but while their power is subject to judicial restraint, the only check on the court's own power is the self imposed discipline of judicial restraint. In exercising judicial review of administrative action the court is not an appellate authority, and the Constitution does not permit it to direct or advise the executive in matters of policy, provided the executive keeps within its constitutional and statutory limits.

Why it matters here. It states the other half of the balance. Discretion is reviewable, but review is not appeal: the court asks whether the choice was lawfully made, not whether it would have made the same choice.

The vocabulary of review

Three expressions recur and should be defined once.

Subjective and objective satisfaction. Where a statute says "if the authority is satisfied", the satisfaction is called subjective; where it says "if the prescribed conditions exist", it is objective. The distinction once mattered greatly, because a subjective satisfaction was thought unreviewable. It matters much less now: even a subjective satisfaction must be arrived at on relevant material, in good faith and for the statutory purpose, and an authority that had no material at all has not been satisfied of anything.

Jurisdictional fact. A fact whose existence is a precondition of the power. If the Act allows a building to be demolished when it is "unauthorised", the building's being unauthorised is a jurisdictional fact, and the authority cannot give itself power by wrongly finding it.

Policy and merits. The area the court leaves to the administration. Whether a road should run east or west is policy; whether the authority considered the relevant matters in choosing is law.

A worked example

A statute provides: "The Commissioner may, if he is satisfied that it is necessary in the public interest, refuse to renew a licence, after giving the licensee an opportunity of being heard, and shall record his reasons."

Ask, in order, the questions Module III asks.

1. Is there discretion? Yes, on two points: whether the public interest requires refusal, and whether to refuse.
2. Is it unfettered? No. It is confined by the words "in the public interest", by the hearing requirement, by the duty to give reasons, and by Articles 14 and 21.
3. What must the Commissioner do? Hear the licensee, consider the relevant material, ask himself the question the statute poses and no other, and record reasons.
4. What may he not do? Refuse because the licensee criticised him, which is an improper purpose. Refuse on a departmental circular treated as binding, which is a fetter on discretion. Refuse because a minister told him to, which is acting under dictation. Refuse without any material, which is no satisfaction at all.
5. What will a court not do? Substitute its own view of where the public interest lies. Asif Hameed v. State of Jammu and Kashmir, AIR 1989 SC 1899.

Those questions and answers are the whole of the next two chapters, and a student who can ask them in this order can answer any problem on discretion.

Distinctions worth having straight

What it does NOT mean

It does not mean discretion is a licence. Every discretion is conferred for a purpose and confined by the Act that confers it.

It does not mean a subjective formula excludes review. "If in the opinion of" limits the intensity of review; it does not remove it.

It does not mean a court may correct an unwise decision. Unwisdom is not a ground; unreasonableness of the extreme kind is: [Grounds of Judicial Review: Abuse of Discretion].

It does not mean discretion is inconsistent with the rule of law. The modern view is that discretion conferred by law, exercised for its purpose and subject to review, is compatible with it: [Rule of Law].

Quick revision

1. Administrative discretion: statutory power to choose between courses of action, or to decide whether to act.
2. Recognise it by "may", "if satisfied", "if in its opinion", "as it thinks fit". Recognise its absence by "shall" on a stated fact.
3. Reasons for conferring it: unforeseeable cases, changing circumstances, individual justice, technical judgment, planning and allocation, and speed in emergency.
4. The danger is arbitrariness; the answer is to confine, structure and check, not to abolish.
5. Maneka Gandhi v. Union of India, AIR 1978 SC 597: equality and arbitrariness are sworn enemies; Article 14 strikes at arbitrariness; the procedure under Article 21 must be right, just and fair. Discretion is therefore never unfettered in India.
6. Asif Hameed v. State of Jammu and Kashmir, AIR 1989 SC 1899: judicial review is a powerful weapon, but the court is not an appellate authority and may not direct or advise on policy; the only check on the court is self imposed restraint.
7. Vocabulary: subjective and objective satisfaction, jurisdictional fact, policy and merits.

Test yourself

1. What is administrative discretion, and why is it conferred? It is the power given by statute to an administrative authority to choose between alternative courses of action, or to decide whether to act at all, according to its own judgment of what the circumstances require. It is conferred because a legislature cannot foresee every case that a general rule will meet; because circumstances change faster than statutes can be amended; because a rigid rule produces hardship in the exceptional case and discretion permits individual justice; because many modern decisions require technical judgment that a statute cannot supply; because planning and allocation necessarily involve choice; and because emergencies require action before fresh authority can be obtained.

2. Is administrative discretion consistent with the rule of law? On Dicey's first meaning it was not, since he treated wide discretionary authority as the opposite of the rule of law. The modern position is that discretion is compatible with the rule of law provided it is conferred by law, confined to the purpose for which it was given, structured by published criteria and reasons, and subject to judicial review. That is reinforced constitutionally by Maneka Gandhi v. Union of India, AIR 1978 SC 597, which held that Article 14 strikes at arbitrariness in State action, that equality and arbitrariness are sworn enemies, and that a procedure affecting personal liberty must be right, just and fair, so that no statutory formula can confer an unfettered power.

3. Distinguish subjective from objective satisfaction, and state its present importance. Where a statute conditions a power on the authority being "satisfied" or on something being "in its opinion", the satisfaction is called subjective; where it conditions the power on the existence of stated facts, it is objective. Formerly a subjective satisfaction was thought to be beyond review. It is no longer so: even a subjective satisfaction must be formed on relevant material, in good faith and for the purpose for which the power was conferred, and an authority with no material before it cannot be said to have been satisfied at all. The distinction now affects the intensity of review rather than its availability.

4. Can a court substitute its own decision for that of the administrative authority? No, as a rule. Asif Hameed v. State of Jammu and Kashmir, AIR 1989 SC 1899, holds that in exercising judicial review of administrative action the court is not an appellate authority, and that the Constitution does not permit it to direct or advise the executive in matters of policy, provided the executive stays within its constitutional and statutory limits. The court asks whether the discretion was lawfully exercised; if it was not, the ordinary order is to quash the decision and require the authority to decide afresh according to law.

5. How may discretion be structured? By requiring the authority to publish the criteria on which the power will be exercised, to follow a settled procedure, to keep records, and to give reasons for its decisions. Departmental circulars and published policies perform this function, and although they are not law they bind the administration internally and may found a legitimate expectation. Section 4 of the Right to Information Act 2005 now imposes a statutory duty to publish the norms set for the discharge of functions and to give reasons for administrative and quasi-judicial decisions to affected persons, which converts much of this from good practice into obligation.