TMI Blog2012 (6) TMI 907X X X X Extracts X X X X X X X X Extracts X X X X ..... al that the Division Bench has relied upon the judgment of Supreme Court in Chander Mohan Khanna Vs. NCERT AIR 1992 SC 76. 3. Learned Counsel for the appellant states that judgment of J.S. Shamim is no longer a good law in view of Constitution Bench judgment (rendered by Seven-Judge Bench) of the Supreme Court in Pradeep Kumar Biswas ors. Indian Institute of Chemical Biology ors. 2002 (5) SCC 111. He further submits that in J.M. Shamim (supra) the Division Bench did not go into the status and character of National Book Trust and simply relied upon the judgment of Supreme Court in Chander Mohan Khanna (supra) which case related to NCERT. 4. We are of the opinion that the matter requires to be considered by Larger Bench. Accordingly, Registry is directed to place the matter before the Acting Chief Justice for constitution of the Larger Bench. It is apparent from the above that the issue is: Whether National Book Trust (hereinafter referred to as NBT ) is a State or another authority within the meaning of Article 12 of the Constitution of India? Learned Single Judge dismissed the writ petition holding that NBT does not come within the purview of Article 12 of the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... private organizations or individuals in furtherance of the objectives for implementation of programmes. The funds of the NCERT consist of: (i) grants made by the Government, (ii) contribution from other sources and (iii) income from its own assets. It is free to apply its income and property towards the promotion of its objectives and implementation of the programmes. The Government control is confined only to the proper utilization of the grant. The NCERT is thus largely an autonomous body. 4. The ratio of the aforesaid decision was commented upon by the Seven-Judge Bench of the Supreme Court in Pradeep Kumar Biswas (supra). This Seven-Judge Bench judgment of the Supreme Court settles the parameters which have to be taken into consideration for determining as to whether an authority can be called State within the meaning of Article 12 of the Constitution. In Pradeep Kumar Biswas (supra), the Court held that: From this perspective, the logical sequitur is that it really does not matter what guise the State adopts for this purpose, whether by a Corporation established by statute or incorporated under a law such as the Companies Act or formed under the Societies Registration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wise requires, the State includes the Government and Parliament of India and the Government and the Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India. 8. Formation of NBT was on the basis of decision of the Government of India which decided to establish NBT vide resolution dated 15.6.1957. Thereafter, the Government of India had taken a decision to reorganize the NBT vide resolution No.F.14-9/62-S.W. 2, dated 28.9.1962 thereby enlarging the objectives which it seeks to achieve. Para 2 of these objectives states that the Trust shall be an autonomous body, created by and supported by funds placed at its disposal by the Government, though at the same time, permitted to receive donations and bequests as well. 9. NBT is not Government of India or Government of a State . It is not a local authority as well. We, therefore, have to determine as to whether it falls within the ambit of Other Authorities under control of the Government of India. The ambit and scope of other authorities got a paradigm shift in the case of Ramana Dayaram Shetty Vs. The International Airport Authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he meaning must be tempered by a wise limitation. The line of thinking was that it must not be lost sight of that in the modern concept of Welfare State, independent institution, corporation and agency are generally subject to State Control. The State control does not render such bodies as State under Article 12 and the State Control, however, vast and pervasive is not determinative. Even the financial contribution by the State is also not conclusive. The combination of State aid coupled with an unusual degree of control over the management and policies of the body, and rendering of an important public service being the obligatory functions of the State may largely point out that the body is State . On this touchstone, the two-Judge Bench of the Supreme Court discussed various provisions on Memorandum of Association and the rules of the NCERT and came to the conclusion that its activities are not wholly related to Governmental functions and affairs of NCERT are conducted by executive committee comprising of Government servants and educationists. The funds of the NCERT were coming from various sources. NCERT is free to apply its income for achievement of its objectives and implem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government control is confined only to the proper utilization of the grant. It is further pertinent to note that though the Government funding does form a part of the resources of the NBT, the share of financial assistance is very limited as NBT s funding is not entirely from Government resources and other private sources form a major part of its funding. Mr. Jatant Singh submitted that the Government funding forms one out of the five sources of the funding available with the NBT. He further submitted that as far as the activities undertaken by the NBT are concerned, the same are enlisted as objects of the Trust in the Memorandum of Association and Rules of the NBT. A plain reading of the objectives makes it clear that although some of the activities undertaken by the NBT are for public welfare, yet the activities of the NBT as a whole are not closely related to Governmental/sovereign functions. It is also submitted that the functions/objectives as enumerated can otherwise be performed by the NBT. According to him, the ultimate test is that of existence of deep and pervasive State control over the functioning of a Corporation. In this regard, he submitted that having regard to f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not maintainable and the same is dismissed. 15. It was, thus, argued that not every autonomous body like the NBT, with some of Government involvement shall be construed to be State within the meaning of Article 12 of the Constitution, as the same would lead to a chaotic situation where every employee (as in the instant case as well) would seek entitlement to various benefits such as retirement benefits, etc. which are otherwise available only to Government employees. It is also argued that a Corporation is designated as an autonomous body for a specific reason. Such bodies have their own set of Rules and regulations and are not governed by Article 309 of the Constitution. In this regard, reliance is placed on the judgment of this Court in O.P. Gupta Vs. Delhi Vidyut Board Anr. 2000 (54) DRJ, wherein the Court held that the Delhi Vidyut Board is a body constituted and being an autonomous body, it is governed by its own set of Rules and Regulations. It was further held that the Pension Rules as relied upon in the case are not automatically applicable on Delhi Vidyut Board and the employees of the Delhi Vidyut Board are not governed by Article 309 of the Constitution. 16. We h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry of Information and Broadcasting; (f) Such other persons, not exceeding 14, as the Government of India may, from time to time, nominate. 18. The term of the Member appointed by the Government of India is three years (Rule 7). All outgoing Members are eligible for - reappointment (Rule 8). The Chairman of the Trust shall hold office at the pleasure of the Government of India (Rule 13). Functions and powers of the Chairman are stipulated in Rules 41 to 52 which read as under: 48. The Chairman shall be the chief executive officer of the Trust. 49. The Chairman shall preside over all the meetings of the Trust and its Executive Committee. 50. The Chairman shall have all necessary powers for carrying on the day-to-day functions of the Trust. 51. In the event of disagreement between representatives of the Ministry of Finance and the Chairman on financial matters beyond the delegated powers of the National Book Trust, India, the matter may be referred to the Minister of Education and the Finance Minister for a decision. 19. The Annual Report of the working of the Trust as well as audited statement of the accounts of the preceding year are to be submitted to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority, which it has in connection with the audit of the Government accounts. It is specifically spelt out that these rights include the right to demand the production of books, accounts cash vouchers and other documents and papers, and inspect any of the offices of the Trust. The accounts of the Trust as certified by the CAG or any person authorized by him in this behalf, together with the audit report thereon, shall be forwarded annually to the Government of India (Rule 58). 24. As per Rule 59, the Executive Committee is required to prepare annual report of the proceedings of the Trust for the information of the Government of India and the members of the Trust. Rule 60 which provides for amendment of rules and regulations states that this has to be with the previous concurrence with the Government of India. Such a sanction is not mandatory, but a pre-condition which has to be obtained prior to the enforcement of the amendment, is provided in Rule 62. 25. From the aforesaid provisions, without any cavil of doubt, we can conclude that there is a deep and pervasive control over the functioning of NBT. The society owes its existence to the resolution passed by the Governmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... functioning through those appointed members and also through means of audit, etc. and further that the parameters within which NBT is to function, and even when the amendments are to be carried out, there cannot be any other conclusion but to say that it is an altar ego of the Government's instrumentality. 27. Submission of Mr. Jatan Sigh that if NBT is treated an authority under Article 12 of the Constitution, then its employees would seek entitlement to the various benefits as available to Government employees is an unnecessary fear. Merely because NBT is declared an authority under Article 12, its employees would not be governed by Article 309 of the Constitution, which position is clarified in O.P. Gupta (supra) relied upon by the learned counsel himself. 28. We also do not find any merit in the contention of the learned counsel for the respondent that the NBT should not be treated as authority under Article 12 of the Constitution merely because Notification under Section 14 of the Administrative Tribunal Act covering NBT under this Act has not been issued., which has been issued in the case of NCERT. Section 14 of the Act enables the Government to issue Notification ..... X X X X Extracts X X X X X X X X Extracts X X X X
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