1. Directorate of Film Festival v. Gaurav Jain (2007) 4 SCC 737
14. The scope of judicial review of governmental policy is now well defined. Courts do not and cannot act as Appellate Authorities examining the correctness, suitability and appropriateness of a policy. Nor are courts Advisors to the executive on matters of policy which the executive is entitled to formulate. The scope of judicial review when examining a policy of the government is to check whether it violates the fundamental rights of the citizens or is opposed to the provisions of the Constitution, or opposed to any statutory provision or manifestly arbitrary. Courts cannot interfere with policy either on the ground that it is erroneous or on the ground that a better, fairer or wiser alternative is available. Legality of the policy, and not the wisdom or soundness of the policy, is the subject of judicial review [vide : Asif Hameed v. MANU/SC/0036/1989 : State of J&K [1989]3SCR19 ; Shri Sitaram Sugar Co. Ltd. v.MANU/SC/0249/1990 : Union of India - [1990]1SCR909 ; Khoday Distilleries v. MANU/SC/0242/1996 : State of Karnataka AIR1996SC911 , Balco Employees Union v. MANU/SC/0779/2001 : Union of India(2002)ILLJ550SC , State of Orissa v. MANU/SC/2387/2005 : Gopinath Dash AIR2006SC651 and Akhil Bharat Goseva Sangh v. MANU/SC/1795/2006 : State of Andhra Pradesh (2006)4SCC162 ].
2. Atyant Pichda Varg, (2006)6SCC718
Para 19. ...It is settled law that even policy matters have to be tested at the touchstone of arbitrariness and that the present policy is discriminatory and arbitrary....
3. Tata Cellular v. Union of India, (1994)6SCC651
4. Bhavesh D Parish v. Union of India, (2000)5SCC471 (but to be read carefully once)
26. Moreover in the context of the changed economic scenario the expertise of people dealing with the subject should not be lightly interfered with. The consequences of such interdiction can have large-scale ramifications and can put the clock back for a number of years. The process of rationalisation of the infirmities in the economy can be put in serious jeopardy and, therefore, it is necessary that while dealing with economic legislations, this Court, while not jettisoning its jurisdiction to curb arbitrary action or unconstitutional legislation, should interfere only in those few cases where the view reflected in the legislation is not possible to be taken at all.
5. Brij Mohan Lal v. Union of India, 2012(4)SCALE450 (Civil Appeal No. 1276 of 2005 [Under Article 139 of the Constitution of India dated 19.4.2012)
70... The Courts have repeatedly taken the view that they would not refuse to adjudicate upon policy matters if the policy decisions are arbitrary, capricious or mala fide.
72. It is also a settled cannon of law that the Government has the authority and power to not only frame its policies, but also to change the same. The power of the Government, regarding how the policy should be shaped or implemented and what should be its scope, is very wide, subject to it not being arbitrary or unreasonable. In other words, the State may formulate or reformulate its policies to attain its obligations of governance or to achieve its objects, but the freedom so granted is subject to basic Constitutional limitations and is not so absolute in its terms that it would permit even arbitrary actions. Certain tests, whether this Court should or not interfere in the policy decisions of the State, as stated in other judgments, can be summed up as:
14. The scope of judicial review of governmental policy is now well defined. Courts do not and cannot act as Appellate Authorities examining the correctness, suitability and appropriateness of a policy. Nor are courts Advisors to the executive on matters of policy which the executive is entitled to formulate. The scope of judicial review when examining a policy of the government is to check whether it violates the fundamental rights of the citizens or is opposed to the provisions of the Constitution, or opposed to any statutory provision or manifestly arbitrary. Courts cannot interfere with policy either on the ground that it is erroneous or on the ground that a better, fairer or wiser alternative is available. Legality of the policy, and not the wisdom or soundness of the policy, is the subject of judicial review [vide : Asif Hameed v. MANU/SC/0036/1989 : State of J&K [1989]3SCR19 ; Shri Sitaram Sugar Co. Ltd. v.MANU/SC/0249/1990 : Union of India - [1990]1SCR909 ; Khoday Distilleries v. MANU/SC/0242/1996 : State of Karnataka AIR1996SC911 , Balco Employees Union v. MANU/SC/0779/2001 : Union of India(2002)ILLJ550SC , State of Orissa v. MANU/SC/2387/2005 : Gopinath Dash AIR2006SC651 and Akhil Bharat Goseva Sangh v. MANU/SC/1795/2006 : State of Andhra Pradesh (2006)4SCC162 ].
2. Atyant Pichda Varg, (2006)6SCC718
Para 19. ...It is settled law that even policy matters have to be tested at the touchstone of arbitrariness and that the present policy is discriminatory and arbitrary....
3. Tata Cellular v. Union of India, (1994)6SCC651
4. Bhavesh D Parish v. Union of India, (2000)5SCC471 (but to be read carefully once)
26. Moreover in the context of the changed economic scenario the expertise of people dealing with the subject should not be lightly interfered with. The consequences of such interdiction can have large-scale ramifications and can put the clock back for a number of years. The process of rationalisation of the infirmities in the economy can be put in serious jeopardy and, therefore, it is necessary that while dealing with economic legislations, this Court, while not jettisoning its jurisdiction to curb arbitrary action or unconstitutional legislation, should interfere only in those few cases where the view reflected in the legislation is not possible to be taken at all.
5. Brij Mohan Lal v. Union of India, 2012(4)SCALE450 (Civil Appeal No. 1276 of 2005 [Under Article 139 of the Constitution of India dated 19.4.2012)
70... The Courts have repeatedly taken the view that they would not refuse to adjudicate upon policy matters if the policy decisions are arbitrary, capricious or mala fide.
72. It is also a settled cannon of law that the Government has the authority and power to not only frame its policies, but also to change the same. The power of the Government, regarding how the policy should be shaped or implemented and what should be its scope, is very wide, subject to it not being arbitrary or unreasonable. In other words, the State may formulate or reformulate its policies to attain its obligations of governance or to achieve its objects, but the freedom so granted is subject to basic Constitutional limitations and is not so absolute in its terms that it would permit even arbitrary actions. Certain tests, whether this Court should or not interfere in the policy decisions of the State, as stated in other judgments, can be summed up as:
(I) If the policy fails to satisfy the test of reasonableness, it would be unconstitutional.
(II) The change in policy must be made fairly and should not give impression that it was so done arbitrarily on any ulterior intention.
(III) The policy can be faulted on grounds of mala fide, unreasonableness, arbitrariness or unfairness etc.
(IV) If the policy is found to be against any statute or the Constitution or runs counter to the philosophy behind these provisions.
(V) It is dehors the provisions of the Act or Legislations.
(VI) If the delegate has acted beyond its power of delegation.
73. Cases of this nature can be classified into two main classes: one class being the matters relating to general policy decisions of the State and the second relating to fiscal policies of the State. In the former class of cases, the Courts have expanded the scope of judicial review when the actions are arbitrary, mala fide or contrary to the law of the land; while in the latter class of cases, the scope of such judicial review is far narrower. Nevertheless, unreasonableness, arbitrariness, unfair actions or policies contrary to the letter, intent and philosophy of law and policies expanding beyond the permissible limits of delegated power will be instances where the Courts will step in to interfere with government policy.
6. Union of India v.Dinesh Engineering Corporation [2001] 8 S.C.C. 491
7. Subramiam Swamy v. Union of India
We are also conscious of the fact that the Court should not interfere with the fiscal policies of the State. However, when it is clearly demonstrated that the policy framed by the State or its agency/instrumentality and/or its implementation is contrary to public interest or is violative of the constitutional principles, it is the duty of the Court to exercise its jurisdiction in larger public interest and reject the stock plea of the State that the scope of judicial review should not be exceeded beyond the recognised parameters. When matters like these are brought before the judicial constituent of the State by public spirited citizens, it becomes the duty of the Court to exercise its power in larger public interest and ensure that the institutional integrity is not compromised by those in whom the people have reposed trust and who have taken oath to discharge duties in accordance with the Constitution and the law without fear or favour, affection or ill will and who, as any other citizen, enjoy fundamental rights and, at the same time, arebound to perform the duties enumerated in Article 51A. Reference in this connection can usefully be made to the judgment of the three Judge Bench headed by Chief Justice Kapadia in Centre for P.I.L. v. Union of India (2011) 4 SCC 1.
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