TMI Blog1987 (12) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... smissed the writ petition by holding that the employer was neither an agency nor an instrumentality of the Government and did not constitute 'State' within the meaning of Article 12 and, therefore, was not subject to the writ jurisdiction of the High Court. The appeal against the judgment of the learned Single Judge was dismissed on 1st November, 1983. In course of hearing of the appeal Dr. Anand Prakash appearing for ICPS fairly stated that whether the Institute be 'State' or not within the meaning of Article 12 of the Constitution, the employer was prepared to give a fresh opportunity to the appellant to meet the charges so as to dispel from his mind the feeling that he has not been given reasonable opportunity to defend himself. Ordinarily, with that concession the impugned order entailing the dismissal of the employee and the judicial determination against the appellant should have been set aside and the matter should have gone before the enquiry officer for affording reasonable opportunity to the appellant of being heard against the charges. Dr. Anand Prakash, however, invited us to enter into the merits of the issue as to whether ICPS constitutes 'State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Ministry of Education along with three members of the Lok Sabha, a Senior Advocate of the Supreme Court, a member of the Rajya Sabha, the then Vice-Chancellor of Rajasthan University. the respective Secretaries of the Lok Sabha and the Rajya Sabha Secretariat and the Secretary in the Ministry of Law were its Members. The registered office of the Society was initially located within the Parliament House but was later on shifted to the Vithalbhai Patel House, Rafi Marg, New Delhi . The objects of the Society inter alia were: (I) to promote and provide for constitutional and Parliamentary studies with special reference to comparative studies in constitutional systems of various countries and working of the Indian Constitution and parliamentary and governmental institutions in their various aspects; (2) to undertake study of courses and fundamental research relating to developments in constitutional law, conventions and practices, parliamentary procedure, legislative drafting, trends in judicial interpretation and allied matters; (3) to organise inter alia training programmes in constitutional problems and matters of current parliamentary importance; (4) to set up a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Board, Jaipur v. Mohan Lal Ors., [1967] 3 SCR 377 Bhargava, J. who delivered the main judgment observed: the meaning of the word 'authority' given in Webster's Third New International Dictionary, which can be applicable, is a public administrative agency or corporation having quasi- governmental powers and authorised to administer a revenue-producing public enterprise. This dictionary meaning of the word 'authority' is clearly wide enough to include all bodies created by a statute on which powers are conferred to carry out governmental or quasi-governmental functions. The expression other authorities is wide enough to include within it every authority created by a statute and functioning within the territory of India, or under the control of the Government of India; and we do not see any reason to narrow down this meaning in the context in which the words 'other authorities' are used in Article l 7 of the Constitution In Smt. Ujjam Bai v. State of Uttar Pradesh, [1963] 1 SCR 77 Ayyangar, J. had observed: Again Article 12 winds up the list of authorities falling within the definition by referring to 'other authorities' within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the definition of 'State' in Article 12, and constitutional or statutory bodies which do not share that sovereign power of the State are not, in my judgment, 'State' within the meaning of Article 12 of the Constitution. Two cases, the First of Sabhajit Tewary v. Union of India Ors., [1975] 3 SCR 616 and the other of Sukhdev Singh Ors v. Bhagatram Sardar Singh Raghuvanshi Anr., l 1975] 3 SCR 6 19 were disposed of by the same Constitution Bench on February 21, 1975. In both these cases, the true meaning of Article 12 of the Constitution fell for consideration. Sabhajit Tewary's case was one where the status of the Council of Scientific and Industrial Research was examined. This Court took note of the fact that the Council was a society registered under the Societies Registration Act. Under Rule 3, the Prime Minister of India was the ex-officio President of the Society and under Rule 30 the governing body consisted of persons appointed by the Government of India representing the administrative ministry under which the Council of Scientific and Industrial Research is included and the Ministry of Finance. The Court also took note of the manner in which th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al from service contrary to Regulations would enable the employee to a declaration against the statutory corporation of continuance in service or would it end up in claim for damages only and (2) whether the employee of a statutory corporation is entitled to claim protection of Articles 14 and 16 against the Corporation. The Court, therefore, straight went into the question as to whether statutory corporations were authorities within the meaning of Article 12. As a fact, three corporations being the oil and Natural Gas Commission, the Life Insurance Corporation and the Industrial Finance Corporation were before the Court and each one of them had been set up under a special statute. At page 641 of the Reports, the learned Chief Justice pointed out: In the background of the provisions of the three Acts under consideration, the question arises as to whether these Corporations can be described to be authorities within the meaning of Article 12 of the Constitution . At page 642 of the Reports the conclusion was reached to the effect that these statutory bodies are 'authorities' within the meaning of Article 12 of the Constitution. We are really concerned with what ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncipal. The fact that the agent is subject to the direction of the principal does not mean that he has no legal personality of his own ............. The crux of the matter is that public corporation is a new type of institution which has sprung from the new social and economic functions of government and that it therefore does not neatly fit into old legal categories. Instead of forcing it into them, the later should be adapted to the needs of changing times and conditions. I do not think there is any basis for the apprehension expressed that by holding that these public corporations are 'State' within the meaning of Article 12, the employees of these corporations would become government servants. I also wish to make it clear that I express no opinion on the question whether private corporations or other like organisations, though they exercise power over their employees which might violate their fundamental rights, would be 'State' within the meaning of Article 12. Then comes the case of Ramana Dayaram Shetty v. The International Airport Authority of India Ors., [1979] 3 SCR 1014. The question before the Court was whether the International Airport Auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re this.' It was in pursuance of the policy envisaged in this and subsequent resolutions on Industrial policy that corporations were created by Government for setting up and management of public enterprises and carrying out other public functions. Ordinarily, these functions could have been carried out by Government departmentally through service personnel, but the instrumentality or agency of the corporations was resorted to in these cases having regard to the nature of the task to be performed. The corporations acting as instrumentality or agency of Government would obviously be subject to the same limitations in the field of constitutional and administrative law as Government itself, though in the eye of the law, they would be distinct and independent legal entities. If the Government acting through its officers is subject to certain constitutional and public law limitations, it must follow a fortiori that Government acting through the instrumentality or agency of corporations should equally be subject to the same limitations. But the question is how to determine whether a corporation is acting as instrumentality or agency of Government. It is a question not entirely free fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... At page 1052 of the Reports the Court proceeded to consider whether International Airport Authority of India could be said to be an 'authority' falling within the meaning of 'State' in Article 12. The constitution of the body, the manner of filling it up? Government's power of control in the matter of appointment of members and termination of membership were utilised as tests for examining whether the Airport authority was 'State'. After referring to the special A aspects, the Court observed: It will be seen from these provisions that there are certain features of the respondent which are eloquent and throw considerable light on the true nature of the first respondent. In the first place, the Chairman and Members of the first respondent are all persons nominated by the Central Government and the Central Government has also the power to terminate their appointment as also to review them in certain specified circumstances. The Central Government is also vested with the power to take away the management of any airport from the first respondent and to entrust it to any other person or authority and for certain specified reasons, the Central Go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... functioning of the college as noticed in the review of the activities. the Court also took note of the fact that the founding members of the society were enumerated in clause (9) of the memorandum and they were the Chairmen to be appointed by the State Government with the approval of the Central Government, two representatives of the State Government, one representative of the Central Government, two representatives of the All India Council for Technical Education to be nominated by the Northern Regional Committee, one representative of the University of Jammu Kashmir, one nonofficial representative of each of the Punjab, Rajasthan, UttarPradesh and Jammu Kashmir States and to be appointed by the respective Governments in consultation with the Central Government and the principal who shall also be the ex-officio Secretary. The rules of the Society were referred to with a view to finding out the details of functioning. Sabhajit Tewary's case was referred to and distinguished and the tests laid down in the International Airport Authority's case (supra) were approved. Ultimately the Court summarised the position as under: The tests for determining as to when a corpora ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpany or a company formed under the Companies Act, 1956 or it may be a society registered under the Societies Registration Act, 1860 or any other similar statute. Whatever be its genetical origin, it would be an 'authority' within the meaning of Article 12 if it is an instrumentality or agency of the Government and that would have to be decided on a proper assessment of the facts in the light of the relevant factors. The concept of instrumentality or agency of the Government is not limited to a corporation created by a statute but is equally applicable to a company or society and in a given case it would have to be decided, on a consideration of the relevant factors, whether the company or society is an instrumentality or agency of the Government so as to come within the meaning of the expression 'authority' in Article 12. At pages 99 and 100 of the Reports, the Constitution Bench referred to the facts of the particular case and came to hold that the society was an instrumentality or agency of the State. In Som Prakash Rekhi's case (supra) at page 137 of the Reports, Krishna Iyer, J. referred to the five tests and concluded by saying that: The finale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sive and, therefore, it was an instrumentality of the Central Government and as such was an authority within the meaning of Article 12 of the Constitution. ln coming to this conclusion, the Court relied upon the tests indicated in the International Airport Authority's case as also in the case of Ajay Hasia. In Ramchandra Iyer's case, the question for consideration was whether the Indian Council of Agricultural Research (ICAR) was a set up within the meaning of Article 12 of the Constitution. ICAR is also a Society registered under the Societies Registration Act. The Court found that when it was set up, it was an attached office of the Government of Tndia and had not undergone any change when it got transferred into a Society. Applying the tests indicated in International Airport Authority case as also the case of Ajay Hasia, the Court came to the conclusion that there was little doubt that it was an instrumentality or agency of the State. It further stated: ICAR came into existence as an integral department of the Government of India and later on became an attached office of the Central Government. The composition of the ICAR as evidenced by Rule 3 could not have be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l this requirement. At the inception it was certainly not a governmental organisation and it has not been the case of the parties in their pleadings nor have we been told at the bar during the long arguments that had been advanced that the objects of ICPS are those which are a State obligation to fulfil. The Society was thus born out of a feeling that there should be a voluntary association mostly consisting of Members of the two Houses of Parliament with some external support to fulfil the objects which were adopted by the Society. To Start with, the Society was accommodated in the Parliament House but in due course it shifted out. The President of India inaugurated the Society. Very appropriately the Speaker of the Lok Sabha became its first President and three Ministers, a former Chief Justice of India and a former Attorney General joined as its Vice- Presidents. Some of the public officers were also associated in the administrative set-up of the Society. Individual Members of Parliament and the corporate body known as Parliament are certainly two different concepts. Services of some of the employees of Parliament were lent to the Society. While Article 12 refers to Parliamen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Rao, learned counsel for the appellant, to show that in the functioning of the Society there is deep and pervasive control of government. We have examined meticulously the correspondence and the instances where control was attempted to be exercised or has, as a fact, been exercised but these again are features which appear to have been explained away We were taken through the report submitted by the Tripathi Committee which had been set up to suggest changes in the set up and affairs of the Society. The report and the steps taken on the basis of the report are also not material which can be taken to be indisputable features for reaching the conclusion one way or the other. We were shown the correspondence by the Minister of Law with the Executive Chairman of the Society. Undoubtedly the Minister has tried to exercise his authority as the controlling department of Government in the matter of making the grant. As we have already pointed that itself may not be a conclusive feature. We have several cases of societies registered under Societies Registration Act which have been treated as 'State' but in each of those cases it would appear on analysis that either government ..... X X X X Extracts X X X X X X X X Extracts X X X X
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