TMI Blog2007 (5) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... w that there had been deep and pervasive control by the Central Government over Capexil. Moreover, Capexil was discharging public duty on behalf of the Union. Earlier this Court declared Engineering Export Promotion Council, a similarly constituted body by the Ministry of Commerce State within the meaning of Article 12 of the Constitution of India. He also drew our attention to various provisions of the service rules to show Government control over the service conditions of the employees of Capexil. 4. In support of his contention Mr. Ghosh cited the following decisions: (i) 2006(4) CHN, Page 741 (Indian Jute Industries Research Association and Ors. v. Debabrata Sarkar and Ors. (ii) (1989)IILLJ324SC Andi Mukta Sadguru Shree Muktajee Vandas Sivami Suvarna Jayanti Mahotsav Smarak Trust and Ors. v. V.R. Rudani and Ors. (iii) 2003 (3) CHN 430 and 466 Jogesh Chandra Mondal v. Union of India and Ors. (iv) [2002]3SCR100 Pradip Kumar Biswas v. Indian Institute of Chemical Biology and Ors. (v) (2006)11SCC634 S.S. Rana v. Co-operative Societies and Anr. (vi) Unreported decision of this Court in the case of Engineering Export Promotion Council, W.P. No. 15835(W) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring Export Promotional Council was at serial No. 5. The Memorandum and Article of Association of Capexil were included in the Paper Book at pages 57-70 of the Paper Book. Under Clause 6 of the Memorandum of Association, Memorandum of Association could not be altered without the approval of the Central Government. From the reconstituted committee of 1999-2000 appearing at pages 73-75 it appears that out of 23 members, 5 members were nominated by the Central Government and one each from the Federation of Indian Chamber of Commerce and Federation of Association of Small Industries. On perusal of the Balance Sheet and Annual Report it would appear that the Government had a financial control over the grants time to time to extended to Capexil. From the correspondence annexed to the pleadings appearing at the Paper Book it would appear that the Central Government from time to time supervised the export promotion activities conducted through Capexil under various projects. Hence, the issue of Government control could not be brushed aside. For example, under Rule 35 of Service Rules provision for earn leave was incorporated as per the directive of the Ministry. 8. Clause 2.65.1 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed heavy reliance on the fact that CSIR was being funded by the Central Government to a large extent whereas Capexil was not. The audit of CSIR was to be conducted by Comptroller and Auditor General whereas Capexil was having their private auditor. 13. CSIR is a research organization. Hence, Central Government to promote research activity had to extend substantial financial support whereas Capexil was a body of industrialists and/or exporters. Hence, the members were competent enough to run the organization and its establishment. Pertinent to mention, the projects were being funded by the Central Government. Those funds were being used as subsidy and/or other financial incentives to encourage export. It is the prerogative of the Government to fund its allied organizations. To what extent a particular organization is to be funded, is within the domain of the Central Government. That, in our view, cannot be the sole guiding factor (may be a material factor) to decide whether the organization was having any control from the Central Government. 14. (3) His Lordship placed reliance on the fact that CSIR was amenable to the jurisdiction of the Central Administrative Tribunal wherea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il is the only authorized body to espouse the cause of the Government on export promotion of chemical and allied products. With regard to the control of the Government, Clause 2.65.1 of the hand book of Ministry of Commerce, in our view, is sufficient to infer that the Government had a control over the company. Taking a sum total of the situation we are of the view that the learned Single Judge was wrong in holding that Capexil was not amenable to writ jurisdiction and it was an autonomous body free from any Governmental control. 19. Reliance was placed on the decision of ZEE Telefilms Limited (supra) There 5- Judges' Bench interpreted the 7-Judges' decision in the case of Pradip Kumar Biswas (supra). While doing so the Apex Court per majority (3:2) held BCCI was not a State within the meaning of Article 12. We do not wish to deal with this case as our purpose is achieved on analysis of the 7 Judges' Bench decision of the Pradip Kumar Biswas (supra). That decision has a greater binding force on us. Paragraph 40 of the decision in the case of Pradip Kumar Biswas (supra) being relevant herein is quoted below: The picture that ultimately emerges is that the tests ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... teria to find out the Governmental control. Each and every aspect was to be examined and if upon such test being conducted one comes to a conclusion that the authority cannot function contrary to the policy of the Government the said body must be called a State within the meaning of Article 12. Here Capexil is not free to decide their course of action contrary to the policy of the Government. Its primary and sole object is to promote and/or espouse the cause of the chemical and allied industry relating to export under the patronage of the Ministry of Commerce. It recommends extension of subsidy to various exporters. It controls the entire export trade promotion abroad on behalf of the Government of India. Its managing committee is having a substantial control through Central Government having 5 representatives nominated by the Government. Only because the financial aid is not to the extent it was required compared to the expenditure of the company or that its audit is not being conducted by the Comptroller and Auditor General it would not be appropriate for us to exclude this body from the purview of Article 12. From the nature of the work as recognized by the Ministry of Commerc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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