46 THE BANARAS LAW JOURNAL [Vol.

31
31 Ban.L.J.(2002) 57-65

DOCTRINE OF LEGITIMATE EXPECTATION

B. N. Pandey*

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 latest and important of these principles is the doctrine of legitimate
expectation, which is an outcome of synthesis between the principle of
administrative fairness (a component of the principles of natural justice)
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.
The doctrine of legitimate expectation 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 courts 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.
Development in United Kingdom
In the Common law jurisdiction the doctrine had been traced to
an obiter dictum of Lord Denning M. R in Sehmidt v. Secretary of Home
Affairs.2 Lord Denning observed in Sehmidt:

*
. LL.M, Ph.D, Professor, Law School, Banaras Hindu University, BHU
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.
2
. [1969] 2 Ch 149; (1969) 1.AllE.R. 904.
47 THE BANARAS LAW JOURNAL [Vol.31

The speeches in Ridge v Baldwin 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 Healths Statement. The plaintiffs 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 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. 3 The later cases do
3
. In a letter to Prof. C.F. Forsyth, quoted in Cambridge Law Journal, 47 (2), July
1988, at 241.
2002] DOCTRINE OF LEGITIMATE EXPECTATION 48

not suggest any other provenance. Presumably, therefore, the origin of

the concept lies within Lord Dennings 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 law 4
which was subsequently borrowed and developed by the European
Court.5
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.6 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 governments 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 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,7 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,8 the legality
of a decision to close schools was challenged by a group of parents,

4
. The German Concept of Vertrauenschutz sought to protect the confidence that
subjects had placed in government.
5
. 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.
6
. (1983) 2 A.C. 629, (1983) 3 All. E.R. 346.
7
. (1985) A.C. 374, (1984) 3 All. E.R. 935.
8
. (1986) 84 LGR 168.
49 THE BANARAS LAW JOURNAL [Vol.31

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 (in
deciding whether to agree to closures). 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 Coughlan9, 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 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 :
When 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.10
It is for the court to decide in which of the two
categorises is a specific fact situation.

Development in India

9
. [2001] QB 213
10
Id. at 215
2002] DOCTRINE OF LEGITIMATE EXPECTATION 50

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 India 11, 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.12 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 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

11
. (1992) 4 SCC 477.
12
. Id. at 494.
51 THE BANARAS LAW JOURNAL [Vol.31

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.
The next case in which the doctrine of legitimate expectation
was considered is the case of Food Corpn. of India v. Kamdhenu Cattle
Feed Industries.13 There the Food Corporation of India invited tenders for
sale of stocks of damaged food grains and the respondents 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
Case14 and to Preston, in re15 and held that though the respondents 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 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 Corporation 16, 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 (sic) the manner of the
future exercise of administrative power in a particular case. 17 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.
13
. (1993) 1. S.C.C. 71.
14
. Supra note 5.
15
. 1985 AC 835; (1985) 2 All E R 327.
16
. (1993) 3 SCC 499
17
. Id. at 549.
2002] DOCTRINE OF LEGITIMATE EXPECTATION 52

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.18
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.19
In M.P. Oil Extraction v. State of M.P. 20 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 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 states 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. Raghunathan 21, 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

18
. Id. at 540.
19
. Id.
20
. (1997) 7 SCC 592.
21
. (1998) 7 SCC 66.
53 THE BANARAS LAW JOURNAL [Vol.31

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.
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,22 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.
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 negatived 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" -
22
. (1999) 4 SCC 727
2002] DOCTRINE OF LEGITIMATE EXPECTATION 54

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.