Meaning of Administrative Discretion
Administrative discretion refers to the freedom granted by law to administrative authorities to decide how a power should be exercised in specific circumstances. When a statute does not prescribe a fixed rule and instead allows the authority to choose among alternatives, discretion arises. For example, granting licenses, fixing penalties, awarding government contracts, or determining eligibility for benefits involve discretionary decisions.
Discretion does not imply absolute freedom. It must be exercised within the limits of the statute, guided by reason, public interest, and fairness. When discretion deviates from these principles, it becomes subject to legal review.
Need for Review of Administrative Discretion
The review of administrative discretion is essential for maintaining the rule of law. If discretionary powers remain uncontrolled, they may lead to arbitrary actions that violate fundamental rights and contractual obligations. Review mechanisms ensure that administrative decisions are:
- Made within the scope of legal authority
- Free from arbitrariness and mala fide intention
- Based on relevant considerations
- Consistent with principles of natural justice
In contractual matters involving the State, discretionary decisions such as blacklisting contractors, terminating contracts, or rejecting bids must satisfy fairness and reasonableness. Thus, review acts as a balance between administrative efficiency and individual rights.
Grounds for Review of Administrative Discretion
Courts do not interfere with discretionary decisions merely because they disagree with them. Review is limited to examining the legality, not the merits, of the decision. The following are the main grounds on which administrative discretion is reviewed:
1. Abuse of Discretion
Discretion is abused when an authority acts dishonestly, arbitrarily, or for an improper purpose. Abuse occurs when power is exercised to achieve objectives not intended by the statute. For instance, cancelling a license to punish personal enemies constitutes abuse of discretion.
2. Mala Fide Exercise of Power
Mala fide means bad faith. If an administrative decision is motivated by personal bias, political pressure, or ulterior motives, courts can invalidate it. The burden of proving mala fide is heavy, but once established, the action becomes void.
3. Irrelevant Considerations and Ignoring Relevant Factors
Administrative authorities must base decisions on factors relevant to the statute. If irrelevant considerations influence the decision or relevant facts are ignored, the discretion becomes unlawful. This principle is crucial in contractual decisions such as awarding tenders or imposing penalties.
4. Arbitrariness and Unreasonableness
Administrative discretion must satisfy the test of reasonableness. A decision is unreasonable if no rational authority would have taken it under similar circumstances. Arbitrary decisions violate the rule of law and equality principles.
5. Violation of Natural Justice
Natural justice requires fairness in decision-making. Discretionary actions affecting rights must follow principles such as the right to be heard and absence of bias. Failure to provide an opportunity of hearing renders the decision invalid.
Judicial Review of Administrative Discretion
Judicial review is the most effective mechanism for controlling administrative discretion. Courts examine whether the authority acted within its legal limits and followed due process. Judicial review does not replace administrative discretion with judicial discretion; instead, it ensures lawful exercise.
Courts intervene when discretion results in injustice, discrimination, or breach of statutory or contractual obligations. In government contracts, judicial review ensures transparency, fairness, and equality in administrative actions.
Review in Relation to Law of Contract
Administrative discretion significantly affects contracts entered into by the State. Government contracts involve discretionary decisions at various stages, such as tender acceptance, contract termination, and blacklisting. While the State enjoys discretion, it cannot act arbitrarily or unfairly.
Contract law principles such as consent, fairness, and reasonableness apply to administrative contracts. Courts have consistently held that the State must act as a fair contracting party. Review ensures that discretionary decisions do not violate contractual obligations or legitimate expectations of parties.
Limits on Judicial Review
Although courts possess wide powers, they exercise restraint while reviewing administrative discretion. Judicial intervention is limited to correcting illegality, irrationality, and procedural impropriety. Courts do not substitute their judgment for that of the administrator unless the decision is manifestly unjust or unlawful.
This limitation preserves administrative autonomy while maintaining accountability.
Importance of Review of Administrative Discretion
The review of administrative discretion strengthens democratic governance and public confidence. It ensures transparency, accountability, and fairness in administration. By preventing misuse of power, review protects individual rights and promotes justice. In a welfare state where administrative decisions affect everyday life, such review becomes indispensable.
Conclusion
Administrative discretion is necessary for effective governance, but it must operate within legal boundaries. The review of administrative discretion acts as a constitutional and legal safeguard against arbitrariness and abuse of power. Judicial review, guided by principles of reasonableness, natural justice, and fairness, ensures that discretion serves public interest rather than personal or political motives. In contractual and administrative matters alike, review preserves the balance between administrative efficiency and the rule of law.
Mnemonic Sentence to Remember the Answer
“A MIRROR CAN”
- A – Abuse of discretion
- M – Mala fide
- I – Irrelevant considerations
- R – Reasonableness
- R – Relevant factors ignored
- C – Contractual fairness
- A – Arbitrariness
- N – Natural justice
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