DOCTRINE OF LEGITIMATE EXPECTATION

ADMINISTRATIVE LAW- I

Submitted to
Dr. Vijay P. Tiwari
Associate professor of Law

Submitted by
Hricha Gandhi
UG2016-23

Academic year 2018-19

Maharashtra National Law University, Nagpur

 TABLE OF CONTENTS
TABLE OF ABBREVIATIONS ............................................................................................II
TABLE OF CASES.................................................................................................................. I
INTRODUCTION.................................................................................................................... 2
RESEARCH DESIGN ............................................................................................................. 2
RESEARCH METHODOLOGY .................................................................................................. 2
RESEARCH OBJECTIVE/AIM .................................................................................................. 2
ORIGIN OF THE DOCTRINE OF LEGITIMATE EXPECTATIONS ........................... 2
DEVELOPMENT OF THE DOCTRINE IN UNITED KINGDOM .................................. 4
DOCTRINE OF LEGITIMATE EXPECTATION IN INDIA ............................................ 7
JUDICIAL PRONOUNCEMENTS ....................................................................................... 8
CONCLUSION ...................................................................................................................... 12
BIBLIOGRAPHY .................................................................................................................. 13

I
 TABLE OF ABBREVIATIONS
AIR : All India Report
Bom. : Bombay
Cal. : Calcutta
Ed. (s) : Editor (s) or edited or edition
E.G. : “Exempli gratia”; for example
Ibid : ‘Ibidem’; same as above
Id : Same as second previous
P : Page number
Rev. : Revised
S. : Section
SC : Supreme Court
v. : Verses
SCC : Supreme Court Cases

II
 CASES
A.G. of Hong Kong v. Ng Yuen Shiu ........................................................................................ 5
Attorney-General of Hong Kong vs. Ng Tuen Shiu .................................................................. 7
Council of Civil Service Unions vs. Minister for the Civil Services ......................................... 8
E.C. Commission v. E.C. Council ............................................................................................. 7
Food Corpn. of India v. Kamdhenu Cattle Feed Industries ..................................................... 11
Group Housing Society v. Union of India ................................................................................. 9
J.P. Bansal v. State of Rajasthan .............................................................................................. 14
M.P. Oil Extraction v. State of M.P. ........................................................................................ 12
National Buildings Construction Corporation v S. Raghunathan ............................................ 12
Punjab Communication v. Union of India ............................................................................... 13
R v. Brent London Borough Council ......................................................................................... 8
Regina v. North and East Division Health Authority, Ex-parte Coughlan ................................ 9
Ridge v Baldwin ........................................................................................................................ 6
Schmidt v. Secretary of State for Home Affairs ........................................................................ 5
Supreme Court Advocates on Record Assn. v. Union of India ............................................... 14
Union of India v. Hindustan Development Corporation .......................................................... 11

III
INTRODUCTION

There are several principles of Administrative Law, which have been evolved by the courts
for the purpose of controlling the exercise of power so that it does not lead to arbitrariness or
abuse of power. These principles are intended to provide safeguard to the citizens against
abuse or misuse of power by the instrumentalities or agencies of the State. One of the
important of these principles is the doctrine of legitimate expectation, which is an outcome of
synthesis between the principle of administrative fairness and the rule of estoppel.

It is relevant to note that the doctrine of legitimate expectation is attaining the status of a
fundamental legal concept of administrative justice which is evident from its incorporation
into S. 24 (b) of the Interim Constitution of the Republic of South Africa Act 200 of 1993. 1

The doctrine of legitimate expectation imposes in essence a duty on public authority to act
fairly by taking into consideration all relevant factors relating to such legitimate expectation.
The doctrine is still at a stage of evolution but it has generated a significant body of case law.
It has been judicially recognised by the Indian Supreme Court and this recognition has paved
the way for the development of a broader and more flexible doctrine of fairness.
Consequently, the ultimate question should always be whether something has gone wrong to
the extent that the court’s intervention is required and if so, what form that intervention
should take. In considering whether something has gone wrong, the court has to determine
whether what has happened has resulted in real injustice. If it has, the court must intervene in
the appropriate manner, in this context. The utility of the doctrine of legitimate expectation is
manifold.

1
Section 24(b): “Every person shall have the right to procedurally fair administrative action where any of his
or her rights or legitimate expectations is affected or threatened”.

1
RESEARCH DESIGN

Research methodology
The researcher has adopted doctrinal method of research methodology to compile this
project. Doctrinal method of research involves researching using resources such as books,
material on the internet and other primary and secondary sources of information as opposed
to non-doctrinal method wherein the researcher conducts surveys and seeks opinion from
people.
Research Objective/aim
To study the doctrine of legitimate expectation and to trace its development in United
Kingdom, India and then to analyse its implications by Indian Judiciary.

ORIGIN OF THE DOCTRINE OF LEGITIMATE EXPECTATIONS

The Court discusses that how the doctrine of legitimate expectations first stepped in the
English Law in the case of Schmidt v. Secretary of State for Home Affairs2wherein it was
observed that a foreigner who had been given leave to enter the United Kingdom, had the
right to be heard and had a legitimate expectation of being allowed to stay for the allowed
time.
The Court further goes on to discuss the famous case of A.G. of Hong Kong v. Ng Yuen
Shiu3 wherein Lord Fraser had observed that if a public authority has vowed to follow a
procedure, it is imperative that it acts in a fair manner and fulfills its promise, in the interest
of good administration. The Court remarks that there is an absence of meaning and scope of
the doctrine of legitimate expectation given by the Supreme Court and henceforth it would
like to elaborate on the subject. The Court distinguishes expectation from anticipation and
states that an expectation can only be said to be legitimate only if it has a legal sanctioning or
is backed by a procedure or custom that has been followed consistently.
This case can be categorized as a landmark one in the Indian discourse since it specifically
draws the realm of the doctrine stating that it does not involve a ‘crystallised right’ and thus
does not pave way for direct claim for relief and the doctrine can be confined to the right of
fair hearing in a situation where a promise has been withdrawn or negative. A substantive

2
(1969) 2 Ch. 149.
3
(1983) 2 A.C. 629.

2
expectation doesn’t necessarily amount to an absolute right unless the decision-maker is not
able to justify the withdrawal by overriding public interest and more importantly such a
decision should be founded in arbitrariness, unreasonableness and not justifiably taken in
public interest.
The Court further enunciated that if the issue involves a question of policy or change in
policy then the Courts must remain in their domain and refrain from interfering. Thus
legitimate expectation may lead to judicial review but the scope of relief that can be given by
the Court is very limited.
DEVELOPMENT OF THE DOCTRINE IN UNITED KINGDOM

In the Common law jurisdiction the doctrine had been traced to an obiter dictum of Lord
Denning in Sehmidt v. Secretary of Home Affairs.4 Lord Denning observed in Schmidt:

“The speeches in Ridge v Baldwin5 show that an administrative body may, in a proper case,
be bound to give a person who is affected by their decision an opportunity of making
representations. It all depends on whether he has some right or interest or I would add, some
legitimate expectation, of which it would not be fair to deprive him without hearing what he
has to say…”

The legitimate expectation referred to in, Sehmidt did not give the alien students an
enforceable right to stay for the time originally permitted but an enforceable right to be heard
before the decision to revoke his permit was taken: a procedural protection only. In this case
the plaintiffs, alien students at Hubbard College of Scientology, had been given leave to enter
the United Kingdom before July, 1968, initially for a period of a month. The periods had
been extended to the end of August and September 1968, respectively. Applications were
made on behalf of the plaintiffs to the Home Office on June 11 and July 15, 1968 for
extensions of their stay until November and December 1968, to complete their studies. By
letters of July 29 and 30 the Home Secretary, the defendant, rejected the applications,
referring to the Minister of Health’s Statement. The plaintiff’s stay was, however, extended
to September 30 to let them make arrangements to leave.

The Plaintiffs, on behalf of themselves and 50 other alien students of the college, claimed
declarations against the defendant that his decision not to consider further similar
applications for extension of stay was unlawful, void, and of no effect and the defendant was
bound to consider such applications on their merit and in accordance with the principles of

4
[1969] 2 Ch 149; (1969) 1.AllE.R. 904.
5
[1964] AC 40.

4
natural justice. The court of appeal held that they had no legitimate expectation of extension
and therefore no right to hearing, though revocation of their permits within the earlier granted
period of permit would have been contrary to legitimate expectation.

The particular manifestation of the duty to act fairly is that part of the recent evolution of
administrative law which may enable an aggrieved party to evoke judicial review if he can
show that he had a reasonable expectation of some occurrence or action preceding the
decision complained of and that reasonable expectation was not fulfilled in the event. The
two phrases reasonable expectation and legitimate expectation are treated as synonymous.

It is important that in his judgement in Schmidt v. Secretary of Home Affairs, Lord Denning
makes no mention of any authority, judicial or otherwise, upon which the concept of
legitimate expectation could be founded. Indeed he has said that he feels “sure it came out of
my own head and not from any continental or other source.”6 The later cases do not suggest
any other provenance. Presumably, therefore, the origin of the concept lies within Lord
Denning’s justly famed creative mind and not elsewhere.

However, it may be recalled that prior to the introduction of the doctrine into English law, it
was evolved in German administrative law7 which was subsequently borrowed and developed
by the European Court.8 The judicial evolution of the doctrine of legitimate expectation can
be traced to the opinion of the Judicial Committee delivered by Lord Fraser in Attorney-
General of Hong Kong vs. Ng Tuen Shiu.9 Ng. was an illegal immigrant from Macau. The
government announced a policy of repatriating such persons and stated that each would be
interviewed and each case treated on its merits. Ng. was interviewed and his removal ordered.
His complaint was that at the interview he had not been allowed to explain the humanitarian
grounds on which he might be allowed to stay, but only to answer the questions put to him;
that he was given a hearing, but not the hearing in effect promised, as the promise was to give
one at which mercy could be argued. The judicial Committee agreed that, on that narrow
point, the government’s promise had not been implemented, his case had not been considered
on its merits, and the removal order was quashed. Ng succeeded on the basis that he had a

6
In a letter to Prof. C.F. Forsyth, quoted in Cambridge Law Journal, 47 (2), July 1988, at 241.
7
The German Concept of ‘Vertrauenschutz’ sought to protect the confidence that subjects had placed In
government.
8
See J. Usher, “The Influence of National Concepts on Decisions of the European Court” (1976) 1 European
Law Review 359 at 364 and Re Civil Service Salaries: E.C. Commission v. E.C. Council, (1973) E.C.R.
575; (1973) C.M.L.R. 639.
9
(1983) 2 A.C. 629, (1983) 3 All. E.R. 346.

5
legitimate expectation that he would be allowed to put his case, arising out of the government
promise that everyone affected would be allowed to do so.

In Council of Civil Service Unions vs. Minister for the Civil Services,10 the Prime Minister
issued an instruction that civil servants engaged on certain work would no longer be
permitted to be members of trade unions. The House of Lords held that those civil servants
had a legitimate expectation that they would be consulted before such action was taken, as it
was a well-established practice for government to consult civil servants before making
significant changes to their terms and conditions of service. In this case, it may be noted,
legitimate expectation arose not (as in Ng) out of a promise, but out of the existence of a
regular practice which could reasonably be expected to continue.

In R v. Brent London Borough Council, exp Gunning,11 the legality of a decision to close
schools was challenged by a group of parents, ratepayers and parent governors, who alleged,
inter alia, inadequate consultation. Hodgson J. said:

The parents had no statutory right to be consulted, but that they had a legitimate expectation
that they would be consulted seems to me to be beyond question. The interest of parents in
the educational arrangements in the area in which they live is self-evident, local education
authorities habitually do consult on these matters. In 1980 and 1983 this local authority itself
had comprehensive consultations which had led to the decision in 1983 to retain all school
sites. Local education authorities are exhorted by the Secretary of State to consult and results
of the consultations are something which takes into account. On any test of legitimate
expectation, it seems to me that these parents qualify.

In a subsequent case, the Court of Appeal used this as an opportunity to reconsider the entire
development in Britain in the area of legitimate expectation. In Regina v. North and East
Division Health Authority, Ex-parte Coughlan12, the court enforced against the health
authority its promise made to a lady who was seriously injured in an accident to maintain her
in a nursing home for her life. Perhaps it is very significant feature of the opinion in this case
that the Court of Appeal not only recognized the doctrine of legitimate expectation into two
classes, viz. (1) cases where the court may decide that the public authority was only required
to bear in mind its previous policy or other representation, giving it weight it thought fit,
before deciding to change course. In such cases, the court would review the decision by

10
(1985) A.C. 374, (1984) 3 All. E.R. 935.
11
(1986) 84 LGR 168.
12
[2001] QB 213.

6
applying the test of rationality. (2) cases where the court may decide that a lawful promise
had induced a substantive legitimate expectation. Here the court would decide whether the
frustration of legitimate expectation was so unfair that to take a new and different course of
action would amount to an abuse of power. Finally, the court generalized:

Then the legitimacy of the exception had been established, the court would have the task of
weighting the requirements of fairness against any overriding interest relied upon for the
change of policy.13 It is for the court to decide in which of the two categorizes is a specific
fact situation.
DOCTRINE OF LEGITIMATE EXPECTATION IN INDIA

The legal position in India is more or less the same as in England. The precise content of this
doctrine, which enables an aggrieved person to seek his remedy by judicial review, has also
been the subject matter of evolution through judicial decisions. In Navjyoti Coop. Group
Housing Society v. Union of India14, the Supreme Court recognised that by reason of
application of the said doctrine, an aggrieved party would be entitled to seek judicial review,
“if he could show that a decision of the public authority affected him of some benefit or
advantage which in the past he had been permitted to enjoy and which he legitimately
expected to be permitted to continue to enjoy either until he was given reasons for withdrawal
and the opportunity to comment such reasons”.15 In this case the seniority as per the existing
list of cooperative housing society for allotment of land was altered by subsequent decision.
The previous policy was that the seniority amongst housing societies in regard to allotment of
land was to be based on the date of registration of the society with the Registrar. But on
20.1.1990, the policy was changed by reckoning seniority as based upon the date of approval
of the final list by the Registrar. This altered the existing seniority of the society for
allotment of land. The Supreme Court held that the societies were entitled to a “legitimate
expectation” that the past consistent practice in the matter of allotment be followed even if
there was no right in private law for such allotment. The authority was not entitled to defeat
the legitimate expectation of the societies as per the previous seniority list without some
overriding reason of public policy as to justify change in the criterion. No such overriding
public interest was shown. The Supreme Court recognised that the doctrine, in essence,
imposes a duty on public authority to act fairly taking into consideration all relevant factors

13
Id. at 215.
14
. (1992) 4 SCC 477.
15
. Id. at 494.

7
before effecting a change in its policies which would affect a person who had been
beneficiary of the continuing policy.

The doctrine of legitimate expectation provides that the statements of policy or intention of
the Government or its Department in administering its affairs should be without abuse or
discretion. The policy statement could not be disregarded unfairly or applied selectively for
the reason that unfairness in the form of unreasonableness is akin to violation of natural
justice. It means that said actions have to be in conformity of Article 14 of the Constitution,
of which non-arbitrariness is a second facet. Public Authority cannot claim to have unfettered
discretion in public law as the authority is conferred with power only to use them for public
good. Generally legitimate expectation is essentially procedural in character as it gives
assurance of fair play in administrative action but it may in a given case be enforced as a
substantive right. But a person claiming it has to satisfy the Court that his rights had been
altered by enforcing a right in private law or he has been deprived of some benefit or
advantage which he was having in the past and which he could legitimately expect to be
permitted to continue unless it is withdrawn on some rational ground or he has received
assurance from the decision making Authority which is not fulfilled, i.e., the kind of
promissory estoppel. Change of policy should not violate the substantive legitimate
expectation and if it does so it must be as the change of policy which is necessary and such a
change is not irrational or perverse.
JUDICIAL PRONOUNCEMENTS

The case in which the doctrine of legitimate expectation was considered is the case of
Food Corpn. of India v. Kamdhenu Cattle Feed Industries.16 There the Food Corporation
of India invited tenders for sale of stocks of damaged food grains and the respondent’s bid
was the highest. All tenderers were invited for negotiation, but the respondent did not raise
his bid during negotiation while others did. The respondent filed a writ petition claiming that
it had a legitimate expectation of acceptance of its bid, which was the highest. The High
Court allowed the writ petition. Reversing the judgement, the Supreme Court referred to
CCSU Case17 and to Preston, in re18 and held that though the respondent’s bid was highest,
still it had no right to have it accepted. No doubt, its tender could not be arbitrarily rejected,
but if the Corporation reasonably felt that the amount offered by the respondent was
inadequate as per the factors operating in the commercial field, the non-acceptance of bid

16
(1993) 1. S.C.C. 71.
17
Supra note 5.
18
1985 AC 835; (1985) 2 All E R 327.

8
could not be faulted. The procedure of negotiation itself involved giving due weight to the
legitimate expectation of the highest bidder and thus was sufficient.

In Union of India v. Hindustan Development Corporation19, the Supreme Court has

pointed out that “the concept of legitimate expectation which is latest recruit to a long list of
concepts fashioned by the courts for the review of administrative action, must be restricted to
the general legal limitations applicable and binding the manner of the future exercise of
administrative power in a particular case”.20 According to the Supreme Court an element of
‘speculation’ and ‘uncertainty’ is inherent in that very concept. In this case tenders were
called for supply of cast-steel bogies to the Railways. The three big manufacturers quoted
less than the smaller manufacturers. The Railway then adopted a dual-pricing policy giving
counter-offers at a lower rate to the big manufacturers who allegedly formed a cartel and a
higher offer to others so as to enable a healthy competition. This was challenged by three big
manufacturers complaining that they were also entitled to a higher rate and a large number of
bogies. The Supreme Court held that the change into a dual-pricing policy was not vitiated
and was based on ‘rational and reasonable’ grounds.

The Court noted that “legitimate expectation was not the same thing as a anticipation. It was
also different from a mere wish to desire or hope; nor was it a claim or demand based on a
right. A mere disappointment would not give rise to legal consequences.”21

At another place, in the same judgement, the position was indicated as follows:

The legitimacy of an expectation can be inferred only if it is founded on the sanction of law
or custom or an established procedure followed in regular and natural sequence....Such
expectation should be justifiably legitimate and protectable.22

In M.P. Oil Extraction v. State of M.P.23 the Supreme Court ruled that the doctrine of
legitimate expectation has its application only in the realm of public law and that in an
“appropriate case, constitutes a substantive and enforceable right”. On the facts of the instant
case, it was held that the industries, with whom the State government had entered into
agreements for supply of sal seeds, had a legitimate expectation that in accordance with the
renewal clause and in accordance with the past practice, the agreements would be renewed in
the usual manner. The Court also ruled that the selected industries, with which the state had

19
(1993) 3 SCC 499.
20
Id. at 549.
21
Id. at 540.
22
Id.
23
(1997) 7 SCC 592.

9
entered into agreements for supply of sal seeds at concessional rates, needed the protection of
continuing such agreements and hence, the renewal clause were provided in those
agreements. The Court attached considerable importance to the need for protection of such
selected industries by upholding the validity of the renewal clauses in those agreements,
although it was apparent in the mind of the Court that to ensure fair play and transparency in
the state’s action, it was desirable that distribution of state largesse was effected by inviting
open tenders or by public auction. The Court, however, felt that special agreements entered
into with the selected industrial units by the state government were permissible. The decision
reflects the mind of the court that it considered the doctrine of legitimate expectation as an
equitable principle and that in order to give full effect to this principle, application of another
principle in the realm of public law may, if need be, have to be restricted.

The Supreme Court laid down a clear principle that claims on legitimate expectation required
reliance on representation and resultant detriment in the same way as claims based on
promissory estoppel. In National Buildings Construction Corporation v S.
Raghunathan24, the respondents were appointed in CPWD. They went on deputation to
NBCC in Iraq and opted to draw, while on deputation, their grade pay in CPWD plus
deputation allowance. Besides that, NBCC granted them foreign allowance at 125% of the
basic pay. Meanwhile their basic pay in CPWD was revised w.e.f. 1.1.1986 on the
recommendation of the Fourth Pay Commissioin. They contended that the aforesaid increase
of 125% should be given by NBCC on their revised scales. This was not accepted by NBCC.
The contention of the respondents based on legitimate expectation was rejected in view of the
peculiar conditions and financial stringency (due to embargo put by UNO) under which
NBCC was working in Iraq. On the facts of the case, the Court, found that since there was no
promise or agreement or contract of service executed by NBCC for payment of foreign
allowance to its employees, who were posted on overseas projects, they could not have any
legitimate expectation of receiving such allowance. The Court further ruled that the question,
whether the expectations and the claims made thereupon were legitimate or not, was
essentially a question of fact and therefore, the rules of pleading would strictly apply. A
party which seeks a relief from the Court claiming expectation, ought to place such facts
before the court as would enable it to satisfy itself that such claim is legitimate. It was
observed by the Supreme Court that the doctrine of ‘legitimate expectation’ had both
substantive and procedural aspects.

24
(1998) 7 SCC 66.

10
The Supreme Court restated that a policy decision making representation that benefits of
substantive nature will be granted, creates legitimate expectation which is substantive in
nature and is normally binding on the decision maker. But such policy can be changed in
overriding public interest, since choice of policy is for the decision-maker. However, the
Court emphasised that change in policy defeating substantive legitimate expectation must
satisfy the test of Wednesbury reasonableness. The Courts can interfere on being satisfied
that change in policy is irrational or perverse. In Punjab Communication v. Union of
India,25 the government had changed its earlier policy to provide digital wireless telecom
facility which was for Eastern Uttar Pradesh villages to a policy to provide wider coverage of
villages through analog system. Punjab Communications Limited had filed lowest tender
under the first scheme and hence approached the court on the ground of violation of its
legitimate expectation. The Court found that change in policy is neither irrational nor
perverse, hence, no violation of legitimate expectation.

In Supreme Court Advocates on Record Assn. v. Union of India26 the Supreme Court held
that in recommending appointment to the Supreme Court due consideration of every
legitimate expectation has to be observed by the Chief Justice of India.

In J.P. Bansal v. State of Rajasthan27 Bansal was appointed as Chairman of Taxation

Tribunal on temporary basis till Regular Chairman was appointed. Meanwhile, however the
State abolished the Tribunal. Bansal claimed Rs. 500000 with 15% interest as compensation.
He pleaded doctrine of legitimate expectation. Dismissing the petition the court held that
appointment of Bansal was purely contractual and the doctrine of legitimate expectation had
no application nor Bansal was entitled to compensation.

25
(1999) 4 SCC 727.
26
(1993) 4 SCC 441.
27
(2003) 5 SCC 134.

11
CONCLUSION

The plea of legitimate expectation still remains a very weak plea in Indian Administrative
Law. A claim for a benefit on the basis of legitimate expectation is more often negative by
the courts. It is rarely that such a plea is accepted by courts in India. It is humbly submitted,
therefore, that in situation of confusion of ideas regarding the concept of legitimate
expectation what needs to be realized is that the concept envisages not merely
“expectation"”but “legitimate expectation” which means that there is already something
super-added to just “expectation” - some kind of assurance or representation by the
administration or the fact that the expectation has been recognized over a period of time.
What needs to be realized is that the concept is more of an equitable nature rather than
legalistic in nature. It is the latest recruit to a long list of concepts fashioned by the Courts for
the review of administrative action. The doctrine has a important place in the development of
law of judicial review. Where a decision of the administrative authority adversely affects
legal rights of an individual duty to act judicially is implicit. But even in cases where there is
no legal right he may still have legitimate expectations of receiving the benefits or privilege.
Such expectation may arise either from express promise or from existence of regular practice
which the applicant can reasonably expect to continue.

12
BIBLIOGRAPHY

Books Referred:
 Administrative Law, I.P. Massey, 19th Edition, Eastern Book Company.
 Principles of Administrative Law, M P Jain & S N Jain, 7th Edition, Lexis Nexis.
 Lectures on Administrative Law, C.K. Takwani, Eastern Book Company.

Websites Referred:
 http://www.legitimate expectation.org.au/wp-content/uploads/2012/08/Reports-and
Pres - 4 -11 -Henry - VIII -Clauses -the -rule -of-law1.pdf.

Online Databases:
 SCCOnline.
 AIR.
 LexisNexis.

13