JANUARY 23, 2020

By Kishori Lal, Principal Commissioner (AR), CESTAT, Mumbai

THE doctrine of ultra vires is a Judge made law and it is the result of unaccounted numerous decisions given by the different courts around the globe. But if we talk about the status of the doctrine in England and look at its background then we could conclude that this doctrine was not paid much attention before introduction of the Limited Liability Act, 1855. With the introduction of the above Act, it was deemed proper on the part of ambitious directors, to use the corporate capital of the company only for certain specified objects so that the interest of shareholders and the creditors is protected. This was further elaborated by the Act of 1856, which specified that a company should include an objects clause within its memorandum which would also define the contractual capacity of the company with any outside parties. [Gower L.C.B. Principles of Modern Company Law 4rth Ed. 1979 Page 85]

'Ultra Vires' is a combination of two words Ultra and Vires. In Latin, 'Ultra' means beyond and 'Vires' means powers. Thus, the expression Ultra Vires means "beyond the power". It describes actions taken by government bodies or corporations that exceed the scope of power given to them by laws or corporate charters. When referring to the acts of government bodies (e.g, legislatures) a constitution is most often the measuring stick of the proper scope of power. However, the courts, with the view of curtailing abuse of power by administrative authorities and providing relief for the parties thereby affected, have developed ' Ultra Vires' as a firm doctrine of law, by refining and extending its scope to embrace various types of abuse of power committed by administrative authorities. Wade and Forsyth [H.W.R. Wade & C.F. Forsyth, Administrative Law, [10th ed.] Oxford: Oxford University Press, 2009 at p. 31] in relation to the constitutional framework of the United Kingdom observed, thus:

"Having no written constitution on which he can fall back, the judge in every case be able to demonstrate that he is carrying out the will of Parliament as expressed in the statute conferring the power. He is on safe ground only where he can show that the offending Act is outside the power. The only way in which he can do this in the absence of an express provision, is by finding an implied term or condition in the Act, violation of which then entails the culmination of ultra vires."

The doctrine of ultra vires is said to have originated in Company law as a means of safeguarding the interests of the shareholders of companies and firmly established by the House of Lords in the decision of Ashbury Railways Carriage and Iron Company Ltd. v. Riche [1875] LR 7 HL 653. This was later borrowed into Administrative Law, as the courts found it difficult to question the power of the legislature due to the application of principles such as separation of powers and parliamentary sovereignty. [Wade & Forsyth supra p.3]

The Doctrine of Ultra Vires is a fundamental rule of Company Law. Hence, if the company does an act, or enters into a contract beyond the powers of the directors and/ or the company itself, then said act/ contract is void and not legally binding on the company. The term Ultra Vires means 'Beyond Powers'. Objects clause is contained in the memorandum of Association and sets out the powers of the directors in running the company. The object clause in the Memorandum of the company defines the object for which the company is formed. Traditionally, each power of the company had to be enumerated, which resulted in detailed statements as to the powers of the company but now the companies are able to use the phrase 'to carry on the business of a general commercial company' rather than use exhaustive lists of enumerated powers.

An act of the company must not be beyond the object clause otherwise it will be ultra vires and therefore, void and cannot be ratified even if all the members wish to ratify. Here the expression ultra vires is used to indicate an act of the company, which is beyond the powers conferred on the company by the objects clause of its Memorandum. Sometimes, the expression ultra vires is used to describe the situation when the directors of a company have exceeded the powers delegated to them. Where a company exceeds its power conferred on it by the objects clause of its Memorandum, it's not bound by it because it lacks legal capacity to incur responsibility for the action, but when the directors of a company exceed the powers delegated to them even though the action is ultra vires and the company is not bound by the responsibility but the directors are personally responsible for their acts. This use must be avoided for it is apt to cause confusion between two entirely distinct legal principles.

The doctrine of ultra vires is the basic doctrine in administrative law and delegated legislation as well. Delegated legislation is the legislation made by an authority subordinate to the superior authority, namely, the legislature. A portion of law-making power of the legislature is conferred or bestowed upon a subordinate authority. With the growth of the administrative process in the 20th Century, administrative rule-making or delegated legislation has assumed tremendous proportions and importance. Today the bulk of the law which governs people comes not from the legislature but from the chambers of administrators.

The proposition that an administrative authority must act within the powers conferred upon it by the legislature may well be considered the foundation of Administrative Law. The primary purpose of administrative law, therefore, is to keep the powers of the government within their legal bounds, so as to protect the citizens against their abuse. [Wade & Forsyth, supra p.4] The doctrine envisages that an authority can exercise only so much power as is conferred on it by law. An action of the authority is intra vires when it falls within the power conferred on it but ultra vires if it goes outside this limit. The doctrine of ultra vires has two aspects: substantive and procedural. If an administrative authority acts without power, in excess of power or abuses power, such act(s) are liable to be rendered invalid on the ground of substantive ultra vires. On the other hand when an administrative authority acts in contravention of mandatory rules stipulated in the legislation or does not comply with the principles of natural justice such acts are liable to be rendered invalid on the ground of procedural ultra vires.

When a piece of delegated legislation is declared to be ultra vires it is void and becomes unenforceable. It cannot affect the rights and duties of any person. Until a rule is declared invalid by a court, it is presumed to be valid. If valid and the invalid parts of a rule can be severed, only then the invalid portion of the rule is quashed and the valid portion can continue to remain operative, however, if the valid and the invalid parts are inextricably mixed up, then the entire rule has to go. A void rule cannot be the basis of any administrative action. No one can be prosecuted under a void rule. The validity of a rule can be challenged in a court either directly or collaterally, or by way of defense to a civil claim based on the impugned rule, or as a defense in a prosecution for infringing the rule. A person can challenge the validity of administrative action by challenging the validity of the relevant rule. A person whose interest is affected adversely by a piece of delegated legislation can directly challenge its vires in a court. The court may grant an injunction or declaration or issue mandamus or award damages to the affected person, as court may deem fit.

This simple proposition that a public authority cannot act outside its powers and called the ultra vires is the central principle of administrative law. The juristic basis of judicial review is the doctrine of ultra vires. To a large extent, the courts have developed the subject by extending and refining this principle, which has many ramifications. On the question of reasonableness, the Court cannot strike down an administrative rule on the ground of unreasonableness merely because court thinks that it goes farther than is necessary or that it does not contain certain provisions, which in the opinion of the Court would have been fair. In this sense, ultra vires is a doctrine of judicial restraint. The test becomes a real extension of the ultra vires doctrine insofar as unreasonableness is most inevitably concerned ultimately not just with vires, but also with the quality and merits of the decision given in the case and whether or not the ends of justice are actually met with.

PROTECTION OF CREDITORS AND INVESTORS

Doctrine of ultra vires has been developed to protect the investors and creditors of the company. This doctrine prevents a company to employ the money of the investors for a purpose other than those stated in the objects clause of its memorandum. It enables the investors to know the objects in which their money is to be employed. This doctrine protects the creditors of the company by assuring them that the funds of the company to which they must look for payment are not dissipated in unauthorized activities. The wrongful application of the company's assets may result in the insolvency of the company, a situation when the creditors of the company cannot be paid. This doctrine prevents the wrongful application of the company's assets likely to result in the insolvency of the company and thereby protects creditors. Besides, the doctrine of ultra vires prevents directors from departing the object for which the company has been formed, and thus puts a check over the activities of the directors. It enables the directors to know within what lines of business they are authorized to act.

If an ultra vires contract is executory on both sides, then either party can maintain an action for non-performance of the contract. However, if the ultra vires contract is executory on one side only, and the other party has performed it from their side, then the relief to the injured party will purely depend upon the discretion of the court and in these kinds of cases, the party who has failed to perform the contract is either asked by the court to perform on their part or to pay compensation to the other party by returning the amount of benefit earned by the defaulting party. [Dutta on Company Law 4th Ed. (1976) Page 538]

The ultra vires act or transaction is different from an illegal act or transaction, although both are void. An act of a company, which is beyond its objects clause, is ultra vires and, therefore, void, even if it is legal. Similarly, an illegal act will be void even if it falls within the objects clause. Unfortunately, the doctrine of ultra vires has often been used in connection with illegal and forbidden act. This use should also be prevented.

PLEADING OF THE DOCTRINE

Pleading of the doctrine by third parties not permitted by way of defense. [Street H.A On A Treatise on the Doctrine of Ultra Vires 1930 Ed. (By Sweet & Maxwell London) Page 30] The plea of ultra vires may always be taken by the corporation guilty of impugned transaction, whether such corporation be plaintiff or defendant and no estoppels will preclude the plea; but the doctrine having been enunciated as a weapon of defense for the protection of corporations, when sued for the breach of contract, [Cheshire & Fifoots, on Law of Contract 9th Ed. Page 1877], no other party can take the plea as defense against it.

In the matter of Cotman V Cotman, [(1881) 19 Ch. D. 64-69] where the trustee of a friendly society sued the maker of a note given to obtain a loan and the maker pleaded that the loan was ultra vires, Jessel M.R. observed thus:-

"How the person who borrowed it, there being no illegality in the borrowing…….. can set up the doctrine that they are relieved from their liability by reason of the money having originally belong to a friendly society is a thing which I am quite unable to understand".

But the doctrine of ultra vires can be used as a defense in the pleading in the cases of illegality. A shareholder can maintain a suit in respect of the illegality where a special resolution is improperly passed where the action of the majority is illegal. [Star Tile Works v. Govindan (1959) Kar 259] A shareholder has got the right to oppose by way of pleading any attempt of a company to act ultra vires and the court will interpose in the matter by way of injunction. [Simson v. West Minister Palace Hotel Co. (1880) 8 HL. C. 717] The law laid down in this case can be treated as an exception to the majority rule or the rule mentioned in the famous case Foss V Harbottle [(1843) 2 Hare 461]

GROUNDS ON WHICH DELEGATED LEGISLATION MAY BE CHALLENGED

A delegated legislation can be challenged on the following grounds:-

1.  Enabling or Parent Act is unconstitutional: In democratic countries, particularly, India, the Constitution is supreme and an Act passed by the Legislature has to be in conformity with the constitutional requirements and if it is found to be violative of the constitutional provisions, the court can declare it unconstitutional and void. If enabling or parent Act (i.e. the Act providing for the delegation) is declared unconstitutional a subordinate or delegated legislation made under the Act will also be declared unconstitutional and, therefore, void. The limits of the Constitution may be express or implied.

2 Subordinate or delegated legislation is ultra vires the Constitution: Sometimes it is found that the enabling or parent Act is not violative of the Constitution, but the subordinate or delegated legislation made under it violates the provisions of the Constitution. Such subordinate or delegated legislation will be unconstitutional and void, though the Enabling or Parent Act is perfectly valid. Thus, the subordinate or delegated legislation, (e.g., rules, regulations, by-laws, etc.) made under the enabling or parent Act may be unconstitutional while the enabling or parent Act is constitutional.

3 Delegated legislation is ultra vires the enabling or parent Act: The validity of the subordinate or delegated legislation can be challenged on the ground that it is ultra vires the enabling or parent Act. If the subordinate or delegated legislation made by the delegate is in excess of the power conferred by the enabling or parent Act or is in conflict with the provisions of the enabling or parent Act or is made without following the procedure prescribed by the enabling or parent Act, the delegated or subordinate legislation can be declared invalid on the ground that it is ultra vires the enabling or parent Act. The validity of the exercise of power is tested on the basis of the provision as it stands currently and not on the basis of that it was before.

4 Subordinate legislation is made in excess of the power conferred by the enabling or parent Act: The subordinate or delegated legislation is held to be ultra vires the enabling or parent Act when it is found to be in excess of the power conferred by the enabling or parent Act. If the delegated legislation is beyond the power conferred on the delegate by the enabling Act, it would be invalid even if it has been laid before the Legislature. Where an administrative authority is empowered by the enabling Act to make by-laws to regulate market and the authority makes by-law which prohibits running of cattle market the by-law will be ultra vires the enabling Act.

In S.T.O. v. K. I. Abraham [I967] 20 STC 367 the Act empowered the Government to carry out the purposes of the Act. The Government made rule so as to fix the last date for filing the declaration forms by dealers for getting the benefit of concessional rates on inter-State sales. This rule was held ultra vires the enabling Act on the ground that the Act empowered the Government for making rules for prescribing the particulars to be mentioned in the forms and it was not given power to prescribe a time-limit for filling the form.

5 When delegated legislation is in conflict with the Enabling or Parent Act: When the delegated legislation is found to be directly or indirectly in conflict with the provisions of the enabling Act or parent Act, it is held to be ultra vires the enabling or parent Act. In Delhi Transport Undertaking v. B.R.I. Hajelay [1972 AIR 2452; 1972 SCC (2) 744] a rule was declared invalid on the ground that it was in conflict with the provisions of the Enabling or parent Act. According to Section 92 of the Delhi Corporation Act, 1957, all persons drawing salary less that Rs. 350 per month shall be appointed only by General Manager of the Delhi transport Undertaking. According to Section 95 of the Act, no person can be dismissed by any authority subordinate to the authority who has appointed him. The rules made under the Act empowered the General Manager to delegate all his powers to the Assistant General Manager. The rule was held to be in conflict with the aforesaid provision of the parent Act. The effect of the rule was that a person appointed by the General Manager could be dismissed by the Assistant General Manager. That is a person could be dismissed by an authority subordinate to the appointing authority while Section 95 of the Act provided that no person can be dismissed by an authority subordinate to the appointing authority. Thus, the rule was in conflict with Section 95 of the Act. Consequently the rule was declared invalid.

6. When delegated legislation is made by authority exercising its power mala fide: When the subordinate or delegated legislation is made by the administrative authority exercising its power mala fide or with interior motive, it is held to be ultra vires and, therefore, invalid.

7. When the delegated legislation is unreasonable and arbitrary: When the delegated legislation is found unreasonable and arbitrary, it is declared invalid. Though in some cases, High Courts have expressed the view that the delegated legislation cannot be challenged on the grounds of unreasonableness, however, the general view of the Courts is that the delegated legislation may be challenged on the ground of unreasonableness and arbitrariness. The delegated legislation which is unreasonable and arbitrary can be challenged on the ground that it is violative of Article 14.

In Air India v Nargesh Meerza 1981 AIR 1829, 1982 SCR(1) 438 a regulation provided that an air hostess would retire from the service attaining the age of 35 years or on marriage within 4 years of service or on first pregnancy, whichever occurred earlier. The regulation authorised the Managing Director to extend the age of retirement to 45 years at his option if an air hostess was found medically fit. The Regulation did not contain any guidelines or policy according to which the discretion conferred on the Managing Director was to be exercised. The regulation conferred on the Managing Director unguided and uncontrolled discretion. The termination of service of an air hostess on pregnancy was unreasonable and arbitrary. The regulation was held to be violative of Article 14, being unreasonable and arbitrary.

ESSENTIAL FUNCTION TEST

There is another ground at which a delegated legislation can be struck down and that is essential function test. The Courts have consistently held that an essential legislative function cannot be delegated to the executive. It has to be exercised by the legislature. This was emphasized by the Apex Court in their decision in Vasu Dev Singh v. Union of India [(2006)12 SCC 753] in the following words:-

"118. A statute can be amended, partially repealed or wholly repealed by the legislature only. The philosophy underlying a stature or the legislative policy, with the passage of time, may be altered but therefore only legislature has the requisite power and not the executive. The delegated legislation must be exercised, it is trite, within the parameters of essential legislative policy. The question must be considered from another angle. Delegation of essential legislative function is impermissible. It is essential for the legislature to declare its legislative policy which can be gathered from the express words used in the statute or by necessary implication, having regard to the attending circumstances. It is impermissible for the legislature to abdicate its essential legislative functions. The legislature cannot delegate its power to repeal the law or modify its essential features."

The question that requires to be answered is whether the levy of tax on services is an essential legislative function that cannot be delegated? The answer perhaps lies in the language of Section 94 of the Finance Act, 1994 itself. Section 94(1) is the general power given to the Central government to make rules to carry out the provisions of Chapter V of the FA. The words 'carry out' necessarily imply providing a mechanism for the levy, enforcement and collection of Service Tax. The Rules in this sense are instrumental and intended to achieve the objects of the main statute.

REASONABLENESS TEST

Another criterion for deciding the vires of any law is it's reasonableness. If any law fails the test of reasonableness it can be declared as ultra vires. The judgment of the Court of Appeal in Associated Provincial Picture Houses Ltd. vs. Wednesbury Corporation, [1948] 1 KB 223] which is often referred to as 'Wednesbury' is a leading case on the question of reasonableness. The subject matter of the controversy was that the Sunday Entertainment Act, 1932 gave the local authority the power to allow Cinema to open on Sunday "subject to such condition as the authority thinks fit to impose". The Wednesbury Corporation gave the plaintiff permission subject to the condition that no children under 15 should be allowed in with or without an adult. The plaintiff brought an action declaring that condition was ultra Vires. In this case LORD GREENE M.R., observed that even if a decision maker has not ostensibly breached the irrelevancy principle, yet it may be possible to say that although the local authority has kept within the four corners of the matter which they ought to consider, they have nevertheless come to a conclusion so unreasonable that no sensible authority could ever dream that it lay within the power of the authority. In such a case the court can interfere. Warrington LJ, in Short Vs. Poole Corporation [1926] Ch 66at Pp 90-91 gave the example of the red haired teacher, dismissed because she had red hair. That is unreasonable in one sense being 'absurd'.

It is important to note that the Court cannot strike down an administrative rule on the ground of unreasonableness merely because court thinks that it goes farther than is necessary or that it does not contain certain provisions, which in the opinion of the Court would have been fair. Judges cannot substitute their wisdom with the wisdom of the administrative authorities. Unless a rule is manifestly unjust, capricious, inequitable or partial in operation, it cannot be invalidated on the ground of unreasonableness.

In the case of G.B. Mahajan Vs. Jalgaon Municipal Corp . [1991 AIR 1153; 1990 SCR Supl. (3) 20] the Supreme Court observed that the test for reasonableness as applied to administrative actions is different from the test as applied in the law of torts. In torts, the test is that of a 'reasonable man'. In administrative law, this is not the test because then the judges can substitute their own judgment with the judgement of the administrator. Therefore in administrative law, 'reasonableness' is the standard indicated by the true construction of the Act which distinguishes between what the statutory authority may or may not be authorized to do. It distinguishes between proper and improper use of power. By unreasonableness, the Court meant that it must be manifestly arbitrary. While examining whether delegated legislation is arbitrary so as to offend Article 14 of the Constitution, the test is whether it is manifestly arbitrary. The Supreme Court pointed out that where arbitrariness is alleged against delegated legislation, the presumption of validity is stronger than where arbitrariness is alleged against an executive action.

It is often expressed by saying that the decision is unreasonable if it is one to which no reasonable authority could have come, the essence of what is now commonly called 'Wednesbury Reasonableness'. The test has been regarded as principle of last resort. In the Wednesbury case itself, Lord Greene held that it can be relied on only in limited circumstances. Basically, it can come into play if other principles of review fail for judicial review purposes. In this sense, it is a doctrine of judicial restraint. The test becomes a real extension of the ultra vires doctrine, since unreasonableness is most inevitably concerned ultimately not just with vires, but with the quality and merits of the decisions.

DIFFICULTIES IN APPLYING THE DOCTRINE OF ULTRA VIRES

The efficacy of judicial control of delegated legislation is very much dependent on how broad is the statutory formula conferring power of delegated legislation. It is very much dependent on how broad is the statutory formula conferring power of delegated legislation on the delegate.

The application of the ultra vires rule becomes very difficult because of three reasons: 

(i) Powers are usually conferred in broad language.

(ii) Ordinarily, the Courts interpret the enabling provision rather broadly.

(iii) The courts adopt a deferential, rather than a critical, attitude towards delegated legislation.

In India, the test of reasonableness is applicable to delegated legislation, both on general principles of administrative law as well as under fundamental rights guaranteed under Constitution of India.

MODIFIED DOCTRINE OF ULTRA VIRES

As for anything else, this doctrine also has many critics who have raised various criticisms against the doctrine. Advocates of common law model of legality, such as, Dawn Oliver, S.A. de Smith, Lord Woolf, Jeffrey Jowell, Sir John Laws, P. Craig, D Dyzenhaus and N. Bamforth, have challenged the presumption of intention of the legislature used in the doctrine of ultra vires and have argued that the doctrine articulated at present is indeterminate, unrealistic, beset by internal tensions, and unable to explain the application of public law principles to those bodies which did not derive their power from legislation. However, the Supporters of the ultra vires doctrine, notably, Christopher Forsyth [See, C. Forsyth, "Of Fig Leaves and Fairy Tales] and Mark Elliot [See, M. Elliot. "The Demise of Parliamentary Sovereignty? The implications for Justifying Judicial Review" [1999] 115 LQR 119; M. Elliot, "The Ultra Vires Doctrine in a Constitutional Setting: Still the Central Principle of Administrative Law" [1999] 58 Cambridge LJ 129 in their responses to the arguments levelled against the doctrine have conceded that the legislature will rarely have any specific intent as to the content of the rules, which make up judicial review. However, they maintain that the doctrine of ultra vires must still be the central principle of judicial review. The abandonment of the ultra vires doctrine would entail strong challenges to parliamentary sovereignty and would also involve the exercise of untrammelled power by the courts. They further maintain that legislative intent can be founded by legitimate exercise of judicial power.  

In consideration of the aforesaid, Forsyth and Elliot have put forward a modified doctrine of ultra vires, which is concerned with the general intention of the legislature as opposed to a specific intent. According to this modified doctrine, it is presumed that the legislature is deemed to have intended that its legislation conforms to the basic principles of fairness and justice, which operate in a constitutional democracy. The power is delegated to courts in order to fashion the application of these basic principles in accordance with the rule of law, since the legislature itself cannot realistically workout the precise ramifications of these basic principles. At the same time, the legitimacy of the courts to impose the controls on bodies, which do not derive their powers from legislation, is also recognized by the doctrine.

The modified doctrine of ultra vires is able to overcome many of the problems associated with the traditional ultra vires doctrine and give a fair response to the criticisms levelled against the traditional doctrine. This is because the reasoning underlying the modified ultra vires doctrine is very much similar to the reasoning underlying the common law model. The idea of general legislative intent in the modified doctrine gives the courts freedom and flexibility to read between the lines of the concepts such as rationality, fairness etc. which, in turn, would unlock the doors for the courts to develop the scope of judicial review as they deem fit.

Despite the plus points of the modified doctrine of ultra vires vis-a-vis the traditional doctrine of ultra vires, the modified doctrine too has been criticized by many academics for various reasons. Paul Craig argues that there is no warrant for the claim that general legislative intent in the modern doctrine can be regarded as the foundation of judicial review, in terms of the substance of review itself. According to Craig, [Craig "Competing Models of Judicial Review"[l999] PL 428 at p.447] as long as the doctrine of parliamentary sovereignty is retained, the modified doctrine fails in its logical foundation. He maintains that grounds of judicial review as laid down by courts over the past three hundred years were based on the common model, and that it continues to provide a fitting picture of the true relationship between courts and the legislature. Jeffery Jowell [J. Jowell, "Of Vires and Vacuums: The Constitutional Context of Judicial Review" [1999] PL 448 at p. 459] also prefers the common law justification of judicial review subject to the final modification that judicial review by no means should be unbounded and exercised allowing the judiciary the freedom to impose unconstrained standards.

JUDICIAL REVIEW

Judicial review, at fundamental level, is concerned with public accountability. It seeks to ensure that public power is exercised according to certain well-established norms and principles. It is also equally important that judicial standards do not become a fetter on progressive administrative decision-making. The modern ultra vires doctrine caters to this requirement. As Lord Seaman [R. v. Secretary of State for the Environment, ex. p. Nottinghamshire County Council [I986] 1 AC 240 at pp 250-251] once cautioned:

"Judicial review is a great weapon in the hands of the judges; but the judges must observe the constitutional limits set by our parliamentary system on their exercise of this beneficent power".

The Supreme Court in The Consumer Action Group & another v. State of Tamil Nadu &Ors, [2000 (6) Scale 45] after noticing various precedents recorded in paragraph 18 in the following manner:-

"The catena of decisions referred to above concludes unwaveringly in spite of very wide power being conferred on de legatee that such a section would still not be ultra vires , if guidelines could be gathered from the Preamble , Object and Reasons and other provisions of the Acts and Rules. In testing validity of such provision, the courts have to discover, whether there is any legislative policy, purpose of the statute or indication of any clear will through its various provisions, if there be any, then this by itself would be a guiding factor to be exercised by the de legatee. In other words, then it cannot be held that such a power is unbridled or uncanalised. The exercise of power of such delegatee is controlled through such policy."

Abandonment of the ultra vires doctrine would give the judges more flexibility and freedom in using their judicial discretion. In fact, it is the said judicial flexibility and freedom that is used by advocates in support of resorting to the common law model of judicial review .However, it needs to be noted that in a constitutional democracy, the rationale that administrative discretion should never be unfettered, should equally be applicable to judicial discretion, as well. As Wade [H. W. R. Wade, Administrative Law, [5th ed.] Oxford: Clarendon, 1982 at p. 315] has very aptly pointed out:

"A citizen is entitled to live under the rule of law and not under the rule of discretion."

The modern ultra vires doctrine could be perceived as a mechanism that seeks to maintain a delicate balance between retaining judicial discretion and accountability. The doctrine employs established norms and principles of good administration as the yardstick of judicial review. This would undoubtedly confer discretion on judges to determine what are the norms and principles of good administration. Yet, such discretion would always be controlled by the generally accepted standards.

The scope of judicial review should be wider. The authority while exercising its statutory power must show that the same had not only been done within four corners thereof but otherwise fulfils the criteria laid down there for as was held by the Apex Court, in P.J. Irani vs. State of Madras &Anr. [(1962) 2 SCR 169]

EXCLUSION OF JUDICIAL REVIEW

  Sometimes a clause is inserted in the enabling or parent Act for ousting the jurisdiction of the Courts to review the delegated legislation. This is called exclusion clause. Usually such clause contains the words 'rules made shall have effect as if enacted or included in the Act itself' or 'rules made shall not be called in question in any Court.' In England in Institute of Patent Agents v. Lockwood [1894] AC 347 Lord Herschel expressed the view that such provision excluded the judicial review of the delegated legislation on the ground of ultra vires. However, in a later case, Minister of Health v. King [1931] AC 494 the view of Lord Herschel has not been followed. In this case, the Court held that in spite of the exclusion clause, the delegated legislation can be reviewed by the Court and can be declared invalid if it is found ultra vires the enabling or parent Act. Thus, in England, the present position is that in spite, of the exclusion clause, the subordinate or delegated legislation may be challenged on the ground that it is ultra vires the enabling Act.

 In India also in a few cases the Supreme Court has adopted the view expressed by Lord Herschel but in other cases, the Supreme Court has held that in spite of such exclusion clause, the delegated legislation can be reviewed by the Court. [A.A. Wani "Exclusion of Judicial review" Metropolitan Book Pvt. Ltd., 1st edn 1987 New Delhi at p 11].

(The views expressed are strictly personal.)