6
10 However, it is settled law that the Court cannot interfere with the
soundness and wisdom of a policy. A policy is subject to judicial review on the
limited grounds of compliance with the fundamental rights and other provisions of
the Constitution.
3
It is also settled that the Courts would show a higher degree of
deference to matters concerning economic policy, compared to other matters of
civil and political rights. In RK Garg v. Union of India
4
, this Court decided on the
constitutional validity of the Special Bearer Bonds (Immunities and Exemptions)
Act 1981. The challenge to the statute was on the principal ground that it was
violative of Article 14 of the Indian Constitution. Rejecting the challenge, the
Constitution Bench observed that laws relating to economic activities must be
viewed with greater latitude and deference when compared to laws relating to
civil rights such as freedom of speech:
“8. Another rule of equal importance is that laws relating to
economic activities should be viewed with greater latitude
than laws touching civil rights such as freedom of speech,
religion etc. It has been said by no less a person than
Holmes, J., that the legislature should be allowed some play
in the joints, because it has to deal with complex problems
which do not admit of solution through any doctrinaire or
strait-jacket formula and this is particularly true in case of
legislation dealing with economic matters, where, having
regard to the nature of the problems required to be dealt with,
greater play in the joints has to be allowed to the legislature.
The court should feel more inclined to give judicial deference
to legislative judgment in the field of economic regulation than
in other areas where fundamental human rights are involved.
Nowhere has this admonition been more felicitously
expressed than in Morey v. Doud [351 US 457 : 1 L Ed 2d
1485 (1957)] where Frankfurter, J., said in his inimitable style:
“In the utilities, tax and economic regulation cases, there
are good reasons for judicial self-restraint if not judicial
deference to legislative judgment. The legislature after all
3
Asif Hammed v. State of Jammu & Kashmir, 1989 Supp (2) SCC 364 ; Sitaram Sugar Co Ltd. v. Union of
India, (1990) 3 SCC 223; Khoday Distilleries Ltd. v. State of Karnataka,(1996) 10 SCC 304; Balco
Employees Union v. Union of India, (2002) 2 SCC 333; State of Orissa v. Gopinath Dash, (2005) 13 SCC
495
4
(1981) 4 SCC 675