Civil Procedure Code (CPC)

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New Okhla Industrial Development Authority And Ors Vs BD Singhal And Ors: The Jurisdiction Over A Matter Of Policymaking Lies In The Domain Of The Executive

srishti jain ,
  22 July 2021       Share Bookmark

Court :
The Supreme Court of India
Brief :
The appeals by New Okhla Industrial Development Authority and the State of Uttar Pradesh raise the issue as to whether the High Court has transcended the limits of its power of judicial review.
Citation :
LL 2021 SC 297


Date of Judgment:
July 15, 2021

Judge:
Justice Dr. Dhananjaya Y Chandrachud

Parties:
New Okhla Industrial Development Authority and Ors (Appellant)
BD Singhal and Ors (Respondent)

Subject

The appeals by New Okhla Industrial Development Authority and the State of Uttar Pradesh raise the issue as to whether the High Court has transcended the limits of its power of judicial review.

Overview

• The New Okhla Industrial Development Authority (NOIDA) is constituted under the UP Industrial Area Development Act 1976.

• Section 19 of the Act, enables the authority with the approval of the State Government to frame regulations for the administration of the affairs of the authority.

• Under Section 9 of the Act, the authority framed the New Okhla Industrial Development Authority Service Regulations, 1981. It governs recruitment, appointment, pay, and other service conditions of the staff.

• Regulation 25 of the Noida Regulations, 1981 provides 58 years as the retirement age of the staff.

• In 2001, the State Government issued a notification increasing the age of retirement of Government servants from 58 to 60 years.

• In 2002, the Board of NOIDA submitted the recommendations to the state regarding the increase in the retirement age.

• In 2009, the State Government rejected the proposal. The authority approached the High Court challenging the decision of the State Government.

• The High Court left it open to the Government to consider whether to give effect to the increase in the age of retirement.

• On 30 September 2012, the Government of UP agreed to a proposal of the appellant, to increase the age of retirement of its employees from 58 to 60 years.

• Allahabad High Court set aside the decision of the State Government to allow the enhancement in the age of retirement.

• The High Court exercising its power of judicial review under Article 226 directed that retrospective effect be given to the Government Order from 29 September 2002.

• The High Court while striking down the Government Order dated 30 September 2012 has directed that the enhancement of the age of retirement must date back to 29 June 2002.

• The High Court gave two reasons in its judgment:

i. The Government Order was issued approving the recommendation of NOIDA dated 17 July 2012. It was not in the context of the earlier recommendation.

ii. There was no reason to refuse the benefit of an extension of the age of retirement retrospectively when the State Government more than three years back received the resolution.

• Few respondents placed reliance on the principles of promissory estoppel and legitimate expectation.

Legal Provision

• Section 19 of UP Industrial Area Development Act 1976- Power to make regulations.

• Section 9 of UP Industrial Area Development Act 1976- Ban on the erection of buildings in contravention of regulations.

Judgment Analysis

Observations made by the Court

• The High Court in ordering that the decision has lost sight of the factual background-

i. The rejection of the original proposal on 22 September 2009; and

ii. The judgment of the Division Bench dated 17 January 2012 refusing to set aside the order rejecting the proposal on 22 September 2009, which has attained finality.

• The jurisdiction over a matter of policymaking lies in the domain of the Executive, into which the High Court ought not to have entered. The factual reasons that the High Court has stated are deceptive.

• The recommendation of NOIDA cannot create or alter the legal relationship since it is subject to the approval of the Government.

• Increasing the age of retirement is a public function. The doctrine of promissory estoppel cannot be applied to challenge the action of NOIDA.

• The representation of NOIDA could not have given rise to a legitimate expectation since it was a mere recommendation that was subject to the approval of the State Government.

• For the above reasons, the Court allowed the appeal and set aside the impugned judgment and order of the High Court dated January 25, 2018.

Conclusion

Estoppels is a rule of evidence. It prohibits a party from rejecting or asserting a fact, which he has formally asserted as existing. The legitimate expectation is based on the principle of Rule of Law. It intends to give relief to the people when they are not able to justify their claims by law. The doctrine of legitimate expectation is viewed as one of the grounds of judicial review.

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