2005 (1) TMI 754 - SC - Indian Laws

Summary

Issues Involved:
1. Payment of unpaid salaries to employees of Bihar Hill Area Lift Irrigation Corporation (BHALCO).
2. Determination of liability between the State of Bihar and the State of Jharkhand.
3. Implementation of previous court directions regarding payment of salaries.
4. Division of assets and liabilities between the States of Bihar and Jharkhand.
5. Human rights and fundamental rights of employees under Article 21 of the Constitution.

Issue-wise Detailed Analysis:

1. Payment of Unpaid Salaries to Employees of BHALCO:
The petitioner filed an application seeking clarification on whether the State of Bihar or the State of Jharkhand, or both, are responsible for paying the unpaid salaries of BHALCO employees. The petitioner argued that Jharkhand Hill Area Lift Irrigation Corporation Limited (JHALCO) should be treated as the successor of BHALCO from 15.11.2000 onwards, and that employees of BHALCO should be absorbed by JHALCO if they forgo their claim for salary for the period prior to their absorption dates.

2. Determination of Liability Between the State of Bihar and the State of Jharkhand:
The State of Bihar contended that it should not be liable for further payments as it had already deposited Rs. 50 crores as per the court's previous directions. It also argued that the liquidation proceedings for BHALCO had been initiated and that the employees could choose to be absorbed by JHALCO. The State of Jharkhand, on the other hand, claimed that BHALCO remained under the control of Bihar and that JHALCO was a new corporation with no connection to BHALCO.

3. Implementation of Previous Court Directions Regarding Payment of Salaries:
The court noted that the directions issued on 9th May 2003, which included the deposit of Rs. 50 crores by the State of Bihar, were intended to address the human rights issue of non-payment of salaries, which had led to starvation deaths and suicides among employees. The court emphasized that the State of Bihar could not escape its liability to protect the life and liberty of the employees under Article 21 of the Constitution.

4. Division of Assets and Liabilities Between the States of Bihar and Jharkhand:
The Central Government, exercising its jurisdiction under Section 65 of the States Reorganization Act, had issued orders for the division of assets and liabilities of various corporations between Bihar and Jharkhand. The court noted that the assets, liabilities, and employees of most companies had been divided, with some corporations continuing to function as inter-State corporations. The court directed the States of Bihar and Jharkhand to deposit additional sums (Rs. 50 crores and Rs. 25 crores respectively) to ensure payment of salaries to employees.

5. Human Rights and Fundamental Rights of Employees Under Article 21 of the Constitution:
The court reiterated that the directions issued were based on the human rights and fundamental rights of employees under Article 21, rather than enforcing their legal right to arrears of salaries. The court emphasized the State's constitutional obligation to protect the life and liberty of employees, highlighting the deep and pervasive control exercised by the State over public sector undertakings.

Conclusion:
The court directed the States of Bihar and Jharkhand to deposit additional funds to ensure payment of salaries to employees, emphasizing the protection of their human and fundamental rights under Article 21. The court also requested the High Courts of Patna and Jharkhand to expedite the liquidation proceedings for the concerned corporations. The applications were disposed of with these directions, and the matter was scheduled to be reviewed after six months.