1. Case Study:
CENTRE FOR PUBLIC INTEREST LITIGATION AND OTHERS
V
UNION OF INDIA
With
Writ Petition No.10 of 2011
SUBRAMANIAN SWAMY
V
UNION OF INDIA AND OTHERS
(Writ Petitions No. 423 of 2010 with No. 10 of 2011, decided on February 2nd 2012)
2. RULE OF LAW
Rule of law has been defined by Dicey as; “the absolute supremacy or predominance of regular law
as opposed to the influence of arbitrary power and excludes the existence of prerogative or even
wide discretionary authority on the part of government” and its significance as “equality before
the law or the equal subjection of all classes to the ordinary law of the land administered by
ordinary law courts.”
These concepts of Dicey had a tremendous impact on the growth of administrative law in England
and as stated in MP Jain & SN Jain on Administrative Law, at page 14, that Dicey’s concept of rule
of law has given to countries following the Common Law system a philosophy to curb the
government’s power.
Three principles implicit in the concept of rule of law are relevant for our case study;
1. That the rule of law denotes an absence of arbitrary power of the administration;
2. That the rule of law denotes supremacy of the courts and the courts shall have power to
control administrative action;
3. 3. That the executive must act within the limits of the law and does not overstep the same, the basis
of judicial review of administrative action.
In H.W.R Wade & C.F.Forsyth, Administrative Law (at pages 15 to 18), the concept of rule of law has been
stated as having four meanings;
• First the principle of legality, the primary meaning is that everything must be done according to law
and this requires that every act of governmental power which affects the rights, duties or liberties of
any person, must be shown to have a strict legal pedigree.
• The secondary meaning of the rule of law is that government should be conducted within a
framework of recognized rules and principles which restrict discretionary power. An essential part of
the rule of law accordingly is a system of rules for preventing the abuse of discretionary power.
Intensive government of the modern kind cannot be carried on without a great deal of discretionary
power. The rule of law requires that the courts should prevent the abuse of such powers and the courts
must attempt to strike a balance between the needs of a fair and efficient administration and the need
to protect against an oppressive government.
4. • A third meaning of the rule of law is that disputes as to the legality of government acts are to be
decided by judges independent of the executive in ordinary courts of law as opposed to countries such
as France and Germany where there are separate administrative courts.
• The fourth meaning relates to “fairness”, that the law should be even handed between the government
and citizen.
• In essence it is said that as a legal principle the rule of law has the greatest value based on its core basic
doctrine centered upon legality, regularity and fairness, always with emphasis on the rejection of arbitrary
power.
Rule of Law Is The Basic Feature of The Constitution and what that means;
In India the principle of the rule of law has been said to be a basic feature of the Constitution and the Courts
have stressed the application of the concept in the following manner;
5. • That the Rule of Law permeates the entire fabric of the Constitution and that the law must not be
arbitrary or irrational and it must satisfy the test of reason. (Bachan Singh v St of Punjab AIR 1982 SC
1325).
• That the Rule of Law requires that any abuse of power by a public officer shall be subject to control of
the courts (State of Punjab v Khamchand (1974) 2 SCR 768).
• That the doctrine of equality before the law (Article 14) is a necessary corollary to the concept of Rule
of Law accepted by the Constitution (Satvant Singh Sawhney v D. Ramarathanana AIR 1967 SC
1836).
Top 10 In List of Power Abusers In The World
• Before considering the facts of the case, we should know who the Minister who has been named in the
case was, Mr A. Raja who made it to the Time Magazine top 10 list of worst power abusers in the world.
What exactly did he do to deserve this “award” for all the wrong reasons.
6.
7. Facts of The Case
• Two Petitions were filed to challenge the validity of certain licenses called Unified Access Service
License (UAS license) issued by the Ministry of Communications & IT .
The summarized sequence of events is as follows;
• The New Telecom Policy was announced on 20.11.1998 to suggest reforms in the telecoms sector with
the purpose of making available affordable and effective communications for the public. The policy
stated that there was a need to have a transparent process of allocation of spectrum.
• The Telecom Regulatory Authority of India (TRAI) was established in 1997 and one of the
recommendations made by the TRAI on the 23.6.2000 was that all new telecom operators be selected
through a competitive multistage bidding process preceded by a prequalification round to assess the
bidders. In other words an auction system where bidders would be permitted to raise their bids after
each round.
8. • On 10.9.2003 a Group of Ministers was constituted to consider release of spectrum for growth of the
telecom sector. The Group of Ministers made detailed recommendations, including that pricing of the
spectrum would be done by the Ministry of Finance and the allotment of spectrum be done in a fair and
transparent manner.
• On 23.2.2006 the Prime Minister formed another Group of Ministers to look into the spectrum license
matter, including pricing policy.
• Strangely, the Minister for Communications & IT protested to this and said pricing should be left out,
the PM agreed.
• One year and 6 months after that, the Department of Telecoms on 13.4.2007, requested TRAI to give its
recommendations on spectrum licenses, TRAI gave its recommendations stressing that all spectrum
should be auctioned, and that spectrum was a scarce resource.
• On 17.10.2007 the Minister of Communications & IT accepted the recommendations. However he took
no action to comply with it and took no action to obtain the advice of the Finance Ministry on pricing.
9. Playing With Cut-Off Dates
• What was he up to? On the 24.9.2007, the Dept of Telecom sent a note to state that a large
applications for licenses had been received and that the cut-off date for applications should be
the 10.10.2007.
• A.Raja the minister, did not agree, he said fix the cut-off date on the 1.10.2007 for new
press note to this effect was issued.
• Between 24.9.2007 and 1.10.2007 over 300 applications for licenses were received. Considering
large number, the ex-officio secretary to the government requested the opinion of the Attorney
General and placed the matter before the law minister.
• The Law Minister on the 2.11.2007 stated that the matter must be considered by the AG.
• A.Raja’s response to this was “Discuss Please”. On the same day Raja did two things;
approved on his own the issuance of licenses to applications received up to 25.9.2007 (not
1.10.2007 as was officially announced) effectively changing the cut-off date to eliminate
applications.
10. • Raja also sent a note to the PM criticizing the Law Minister and said that he would follow the first come
first served policy for all applications, not the auction process.
• The PM replied to Raja asking him that before he took any further action, he should give urgent
consideration to the issues which were already being raised in the media to ensure fairness and
transparency.A. Raja sent a reply to the PM and brushed aside the request of the PM.
The Grounds of Challenge
The grounds on which the grant of licenses was challenged are that:
• The procedure adopted by the Department of Telecoms was arbitrary, illegal and in complete violation
of Article 14 of the constitution. Once the court held that the cut-off date, i.e., 25.9.2007 fixed for
consideration of the applications was arbitrary and unconstitutional, the entire procedure adopted for
the grant of the licenses was liable to declared illegal and quashed.
• The decision to grant the licenses at the price fixed in 2001 without consulting the Finance Ministry was
not in accordance with the governments own mandate and decision taken by the council of ministers in
2003.
11. Further that the policy of 1st come 1st served is itself violative of Article 14.
The Grounds raised by the Respondent
• The main ground raised by the respondents was that the petitioners are not entitled to challenge the
recommendations and policy decisions of the government for grant of the licenses.
Arguments raised during hearing
• The petitioners counsel argued that the spectrum which is a national asset cannot be distributed by
adopting the policy of first come first served without holding any auction.
• The first come first served policy was manipulated by the minister of communication to favour some
of the applicants including those who were not even eligible. It was pointed out that out of 122
applications, 85 were found to be ineligible.
• The Attorney General argued that the policy decision taken by the Government of India cannot be
scrutinized by the Court.
12. DECISION
The Supreme Court held in allowing the petitions,
• The state’s actions and the actions of its agencies must be for public good and should not be
arbitrary or capricious. (This is the first principle of the rule of law- that rule of law denotes an
absence of arbitrary power of the administration).
• The state is the legal owner of the natural resources as the trustee of the people and the process
of the distribution must be guided by the constitutional principles including the doctrines of
equality and larger public good. (The policy of first come first served is arbitrary and violative of
Article 14 of the Constitution).
• The actions of the department of telecoms and the minister were wholly arbitrary and contrary
and contrary to public interest and violative of the doctrine of equality.
13. • When it is clear that the policy of the State or its agencies is contrary to public interests or the
Constitution it is the duty of the Court to exercise its power of judicial review- (This comes within
third principles of the concept of rule of law, judicial control of administrative action and that the
executive must act within the limits of the law which is the basis of judicial review).
• In effect the Supreme Court declared illegal all licenses issued on or after 10.01.2008.
