TMI Blog1999 (1) TMI 548X X X X Extracts X X X X X X X X Extracts X X X X ..... le 12 of the Constitution of India. The petitioner's application seeking permission to contest in the Bangalore City Corporation Elections came to be rejected. 3. Petitioner Smt. C. Chandramma, in W.P. No. 28766 of 1996 is an employee working as Senior Office Assistant in M/s. Indian Telephone Industries Limited, Bangalore Complex, Dooravaninagar, Bangalore-16. She filed her nomination and the scrutiny of the nomination papers was taken up on 4-1-1996. It appears that the first respondent had issued a note on the qualifications and disqualifications of candidates under the Act, dated 19-12-1995 and inter alia it was opined by the first respondent that employees of the State, Central and Public Sector Undertakings are deemed to hold an office of profit under an authority; and so, the same is a disqualification under Section 26(1)(c) of the KMC Act. 4. Petitioner Sri Muniraju in W.P. No. 28842 of 1996 is an employee working as Accountant Category (SH) in M/s. Indian Telephone Industries Limited, Bangalore Complex, Bangalore. He contends that Indian Telephone Industries Limited is a Public Sector Undertaking engaged in the business of manufacture of telecommunication equipme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owever, having regard to the subsequent decision of the Supreme Court in Satrucharla Chandrasekkar Raju v Vyricherla Pradeep Kumar Dev, which distinguishes Biharilal Dobray v Roshan Lal Dobray, and the decision of the Full Bench of this Court in K.V. Panduranga Rao v Karnataka Dairy Development Corporation, Bangalore and Others and the disinvestment of part of the share capital in BEML by the Central Government in favour of the public, the position may not be the same and the matter requires consideration by a Division Bench . 3. After hearing the learned Counsel for the parties, perusing the record and minutely examining various judgments cited at the Bar, we are prima facie of the opinion that the law laid down by this Court in Chenna Reddy's case, supra, which was affirmed by the Division Bench in W.A. No. 669 of 1990, requires reconsideration. While disposing of SLP No. 11150 of 1991, the Hon'ble Supreme Court had not decided the pleas on merit and appear to have dismissed the appeal in limine without assigning the reasons or passing a speaking order. The learned Counsel for the petitioners tried his best to persuade us to take a different view than the one taken by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rities' under Article 12. Therefore, contextually, the words 'other authorities' in Section 26(1)(c) should be understood as referring only to Statutory Corporations. Therefore, it is contended by the petitioners that, holding of office of profit under 'other authority' as defined under Article 12 is not a disqualification as the 'other authority' under Section 26(1)(c) of the Act, is not the same as 'other authority' in Article 12 of the Constitution. Consequently, Section 26(1)(c) of the KMC Act is no bar for contesting in the election. It is further contended that Section 26(1)(c) is irrational, vague and discriminatory and therefore, it is unconstitutional. 8. Learned Advocate General and Counsel for respondent organizations contended that the petitioners are the employees of Government Companies which will fall within the definition of 'other authority' as used in Article 12 and Section 26(1)(c) of the Act. The term 'other authority' used in Section 26(1)(c) has the same meaning as the words 'other authority in Article 12. Therefore, the petitioners incur disqualification under Section 26(1)(c) and barring them from c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rson shall not be deemed to hold any office of profit by reason only that he is the President or Vice-President of the Union or the Governor of any State or is a Minister either for the Union or for any State . Article 66(4) reads: 66. Election of Vice-President.- (1).... (2).... (3).... (4) A person shall not be eligible for election as Vice-President if he holds any office of profit under the Government of India or the Government of any State or under any local or other authority subject to the control of any of the said Governments. Explanation.--For the purposes of this article, a person shall not be deemed to hold any office of profit by reason only that he is the President or Vice-President of the Union or the Governor of any State or is a Minister either for the Union or for any State . We have to examine whether the words other authority in Section 26(1)(c) of the KMC Act is similar to 'other authority' in Article 12 of the Constitution of India. 12. It was argued at length to persuade to hold that the respondent-companies are not the 'other authorities' as defined under Article 12 of the Constitution. To appreciate the contentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Article 243-Q deals with constitution of Municipalities. Article 243-R deals with composition of Municipalities. Article 243-S deals with constitution and composition of Wards Committees, etc. Article 243-T deals with Reservation of Seats. Article 243-V deals with disqualifications for membership.--It provides that a person shall be disqualified for being chosen as, and for being, a member of a Municipality.- (a).....(omitted as not necessary). (b) if he is so disqualified by or under any law made by the Legislature of the State. Article 243-ZA deals with Elections to the Municipalities. Sub-clause (2) reads: Subject to the provisions of this Constitution, the Legislature of a State may, by law, make provision with respect to all matters relating to, or in connection with, elections to the Municipalities . As per the above said clause, the Constitution empowers the States to make law with respect to all the matters relating to or in connection with election to Municipality. Article 243-ZF deals with continuance of existing laws and Municipalities . The above provision makes it clear that any provision of any law relating to Municipalities in for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness. The circumstance that the Board under the Electricity Supply Act is required to carry on some activities of the nature of trade or commerce does not, therefore, give any indication that the Board must be excluded from the scope of the word State as used in Article 12. On the other hand, there are provisions in the Electricity Supply Act which clearly show that the powers conferred on the Board include power to give directions, the disobedience of which is punishable as a criminal offence. The Rajasthan Electricity Board was clearly an authority to which the provisions of Part III of the Constitution were applicable . 20. In case of Ramana Dayaram Shetty v International Airport Authority of India , the Supreme Court traced the genesis of the formation of the Government Companies and held that they were the Instrumentalities or the agencies of the State and were bound to conform to the Fundamental Rights in the same manner as the legislature and the executive. The relevant portion of the judgment reads: . . . . .So far as India is concerned, the genesis of the emergence of corporations as instrumentalities or agencies of Government is to be found in the Government of I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nty-fourth day of January, 1976, in Burmah Shell Refineries Limited. This is the well-worn legal strategy for Government to run economic and like enterprises. We live in an era of public sector corporations, the State being the reality behind. Law does not hoodwink itself and what is but a strategy cannot be used as a stratagem: XXX XXX XXX 26. Constitutional law is not a game of hide and seek but practical real life conclusions. So viewed, we are constrained to hold that Burmah Shell, a Government company though, is but the alter ego of the Central Government and must, therefore, be treated as definitionally caught in the net of 'State' since a juristic veil worn for certain legal purposes cannot obliterate the true character of the entity for the purposes of constitutional law. XXX XXX XXX 39. Let us cull out from Airport Authority's case, supra, the indicia of other authorities. . . under control of the Government of India bringing a corporation within the definition of the State . The following factors have been emphasised in that ruling as telling, though not clinching. These characteristics convert a statutory corporation, a Government company, a co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law and the constitutional order in large sector of governmental activity carried on under the guise of 'jural persons'. It may pave the way for a new tyranny by arbitrary administrators operated from behind by Government but unaccountable to Part III of the Constitution. We cannot assent to an interpretation which leads to such a disastrous conclusion unless the language of Article 12 offers no other alternative. 56. It is well known that Corporations have neither bodies to be kicked, nor souls to be damned and Government corporations are mammoth organisations. If Part III of the Constitution is halted at the gates of corporations Justice Louis D. Brandeis's observation will be proved true: The main objection to the very large corporation is that it makes possible -- and in many cases makes inevitable -- exercise of industrial absolutism. It is dangerous to exonerate corporations from the need to have constitutional conscience; and so, that interpretation, language permitting, which makes governmental agencies, whatever their mein, amenable to constitutional limitations must be adopted by the Court as against the alternative of permitting them to flouris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... horities contemplated in the definition of 'State' in Article 12 . ....It is the Fundamental Rights which along with the Directive Principles constitute the life force of the Constitution and they must be quickened into effective action by meaningful and purposive interpretation. If a corporation is found to be a mere agency or surrogate of the Government in fact owned by the Government, in truth controlled by the Government and in effect an incarnation of the Government the Court must not allow the enforcement of Fundamental Rights to be frustrated by taking the view that it is not the Government and therefore not subject to the constitutional limitations. We are clearly of the view that where a corporation is an instrumentality or agency of the Government, it must be held to be an 'authority' within the meaning of Article 12 and hence subject to the same basic obligation to obey the Fundamental Rights as the Government . 21. The Supreme Court reiterated the principles laid down in R.D. Shetty's case, supra, in its subsequent decisions: (1) Delhi Transport Corporation v D.T.C. Mazdoor Congress and Others. (2) Lamba Industries v Union of India and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 legislative research and reference service for the benefit of all interested members of the Union Parliament and State Legislatures irrespective of their party affiliations; (5) to undertake and provide for the publication of a journal and of research papers and of books and brochures with a view to disseminate democratic values and to foster broad based civic education and awareness, and in particular, to promote study of constitutional and parliamentary affairs; (6) to establish and maintain libraries and information services to facilitate the study of constitutional and parliamentary subjects and spread information in regard theret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lity. A broad picture of the matter has to be taken and a discerning mind has to be applied keeping the realities and human experiences in view so as to reach a reasonable conclusion. Having given our anxious consideration to the facts of the case, we are not in a position to hold that ICPS is either an agency or instrumentality of the State so as to come within the purview of 'other authorities' in Article 12 of the Constitution. We must say that ICPS is a case of its type -- typical in many ways and the normal tests may perhaps not properly apply to test its character . 27. In Sabhajit Tewary's case, supra, Justice A.N. Ray, Chief Justice, speaking for the Constitutional Bench of the Supreme Court, held: The Council of Scientific and Industrial Research, a society registered under the Societies Registration Act is not an authority within the meaning of Article 12. The society does not have a statutory character like the Oil and Natural Gas Commission, or the Life Insurance Corporation or Industrial Finance Corporation. The fact that the Prime Minister or the President or that the Government appoints nominees to the governing body or that the Government may term ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt has considered whether the organisations, Companies and Corporations are authorities within the meaning of Article 12 of the Constitution of India, after scrutinising the nature or origin, pervasive control of the State and financial assistance by the State, Rules and Bye-laws made, and power provided to such body and its control over other organisations etc. Taking these facts, we have to decide whether any organisation is an 'Authority' or not, keeping in view the principles laid down by the Apex Court. 31. BEML was incorporated under the Companies Act on 11th May, 1964. The share capital of the Company was Rs. 15 Crores divided into 1,50,000 equity shares of Rs. 1,000/- each. The subscribers to the Memorandum of Association were the President of India and four other officers of the Government of India, viz., the Secretary, the Joint Secretary, the Deputy Secretary in the Ministry of Defence Production and an Under Secretary in the Ministry of Defence. 32. Under Clause 95 of the Memorandum of Association, the President of India is empowered to determine in writing the number of Directors of the Company. Under Clause 97, the Directors of the Company are to be appo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lephone Industries Limited which is another Public Sector Undertaking engaged in the manufacture of Defence and Telecommunication equipment, is similar. 33. These two organisations are Government Companies subject to pervasive control of the Central Government. Therefore, these organisations are 'other authorities' under Article 12 of the Constitution of India. In fact, as early as 1982, this Court has held that BEML is 'State' in. 34. The next contention of the petitioners is that, though respondent organizations are 'other authorities' within the meaning of Article 12 of the Constitution of India, the said principle cannot be extended while considering 'other authorities' under Section 26(1)(c) of the impugned Act; and the expression 'other authorities' in Section 26(1)(c) of the impugned Act has to be considered independently. 35. There is no dispute that the definition of 'State' within Article 12 of the Constitution of India is intended to apply in Chapters III and IV of the Constitution dealing with the Fundamental Rights and Directive Principles. But there is no bar to incorporate the words 'other authorities' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther than such offices as are declared by rules made under this Act not to disqualify the holder ; Both these sections are similar and there is no difference and as stated supra, a Division Bench of this Court held that the office of profit in BEML is a bar for contesting elections under Section 11(1)(j) of the Zilla Parishads Act, which is similar to Section 26(1)(c) of the KMC Act. Therefore, holding of office of profit in BEML and ITI which are other authorities amounts to holding of office of profit in terms of Section 26(1)(c) of the impugned Act. So, the petitioners are disqualified to contest the election of Municipal Councillor. 39. Let us now consider whether the said decision requires reconsideration having regard to the contentions urged by the petitioners. At the outset, it should be noticed that the tests applicable to find out whether an 'organisation' falls within the expression 'other authorities' in Article 12; there is no bar in construing the words 'other authority' in a statute, taking into consideration the facts and circumstances of each case, in the light of the principle laid down by the Apex Court, interpreting the words ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This point can be viewed in another perspective. The words 'other authorities' apart from Article 12 of the Constitution, is also found in Articles 58(2) and 66(4) of the Constitution of India. 46. Article 58 of the Constitution deals with qualification for election as President of India. Article 58(2) provides that: A person shall not be eligible for election as President if he holds any office of profit under the Government of India or the Government of any State or under any local or other authority subject to the control of any of the said Governments . Article 66 deals with election of Vice-President of India. Article 66(4) provides: A person shall not be eligible for election as Vice-President if he holds any office of profit under the Government of India or the Government of any State or under any local or other authority subject to the control of any of the said Governments . 47. Thus, the person holding an office under 'other authority' is disqualified to contest the election of President or Vice-President of India. Article 12 of the Constitution provides definition of a 'State', whereas, the above Articles deal with the disqualif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntesting elections of the legislative assembly or parliamentary members, there is no disqualification in Articles 102(1) and 191(1)(a) of the Constitution of India. The Supreme Court after comparing the above articles held that, the person holding an office of profit under 'other authority' is not a disqualification for the election of the legislative assembly or parliamentary members. Thus, the Supreme Court has impliedly held that a person working in a Government Company which is a person holding office of profit in an 'other authority' is a disqualification for election of the President and Vice-President of India. This judgment was there much earlier to the enactment. As stated supra, the Legislature is deemed to have the knowledge of all the provisions of the Acts and judgments of the Courts. Therefore, it is proper to say that the words 'other authority' was incorporated basing on the Articles 58(2) and 66(4) of the Constitution of India and the judgment of the Supreme Court. 49. It is contended that the meaning of the words 'other authority' under Article 12 confined only to Fundamental Rights and Directive Principles of State Policy and it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthorities'. For this proposition, learned Counsel for the petitioner relied on a judgment of the Supreme Court in M/s. Utkal Contractors and Joinery Private Limited and Others v State of Orissa and Others, wherein the Supreme Court held: A statute is best understood if one knows the reason for it. The reason for a statute is the safest guide to its interpretation. The words of a statute take their colour from the reason for it. There are external and internal aids to discover the reason for a statute. The external aids are statement of objects and reasons when the Bill is presented to Parliament, the reports of Committees which preceded the Bill and the reports of Parliamentary Committees. Occasional excursions into the debates of Parliament are permitted. Internal aids are the preamble, the scheme and the provisions of the Act. No provision in the statute and no word of the statute may be construed in isolation. Every provision and every word must be looked at generally before any provision or work is attempted to be construed. The setting and the pattern are important. It is again important to remember that Parliament does not waste its breath unnecessarily. Just as Parl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reasons for it that the Court construed the expression 'Prize Chit' in Srinivasa Enterprises v Union of India and we find no reason to depart from the Court's construction . 53. There is no dispute about the propositions laid down in the above judgments. 54. The KMC Act used the word 'local' or 'other authority' in Section 26(1)(c) of the KMC Act, prescribing the disqualification for the persons who are holding office under the 'other authorities'. Interpreting similar section in Section 11(1)(j) of the Zilla Parishad Act, this Court held that the employment in BEML is an authority holding office of profit which entails a disqualification as held in Chenna Reddy's case, supra, which was confirmed in W.A. No. 669 of 1990, dated 23-10-1990. In both the judgments, it was considered whether BEML is an authority or not, it has been held that it is an authority. No grounds are shown before us to differ with the Division Bench judgment of this Court. It is to be noted that the Legislature used the words 'other authorities' in different legislations, wherever it is required. In most of the cases, it was interpreted that the words 'o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce by representatives of the people elected directly or indirectly. But elected representative to govern is neither fundamental right nor common law right but a special right created by the statutes, or a political right or a privilege by the statutes, or a political right or a privilege and not a natural, absolute or vested right. Concepts familiar to common law and equity must remain stranger to election law unless statutorily recognised. 61. From the above principles laid down in the said judgments, it is manifest that the right to elect, right to be elected are statutory creations. So, they are subject to statutory limitations. Therefore, the statute can impose any restrictions. So, disqualification prescribed for the holders of the office of profit under 'other authority' is valid disqualification prescribed by Section 26(1)(c) of the KMC Act. 62. Learned Counsel for the petitioners contended that since the words 'local' or 'other authority' is mentioned in the Section 26(1)(c), the words 'other authority' should be construed similar to 'Local Authority' applying the principle of ejusdem generis rule. 63. To effectively appreci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interpreting 'other authority' similar to 'Local Authority'. 66. The principle laid down by the Apex Court manifests that to invoke the application of ejusdem generis rule there must be distinct genus or category. The specific words must apply not to different objects of the widely different character but to something which can be called a class or kind of object, where this is lacking the rule will not apply and mention of single species will not constitute genus. 67. As held above the 'other authority' in Section 26(1)(c) of the Act cannot be interpreted by applying the principle of ejusdem generis, so, we are not able to accede to the contention of the Counsel for the petitioners. 68. It is fourthly contended that the control on the respondent organizations is not similar to one envisaged on Municipal Corporation by the State in the Act. Therefore, the respondent organizations cannot be deemed as 'other authority'. 69. The learned Counsel for petitioners has taken us through the definitions and Chapters IV, VII and IX. Chapter IV of the Act deals with the powers and functions of the 'Corporation' and 'other authorities' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses Act. 73. This contention at the outset is not tenable, if the Legislature intended to incorporate the definition of the 'Local Authority' as defined in General Clauses Act, the Legislature would have incorporated the same. When the Legislature specifically provided the definition of 'Local Authority' in KMC Act, to infer that the Legislature was having in mind the definition of the 'Local Authority' as under the General Clauses Act is not acceptable. If it is accepted for the purpose of arguments, it amounts to amending a statute i.e., to place the word 'Local Authority' in General Clauses Act in the place of 'other authority' which is not within the function of this Court. 74. The learned Counsel for the petitioners sixthly contended that when the organisation is an Autonomous body without full control of the Government, it cannot be said as an 'Authority' and for the proposition what are the principles governing 'Autonomy', the Counsel for the petitioners relied on catena of decisions. 75. In Uttar Pradesh State Electricity Board v Ram Autar and Another, the Supreme Court dealing with an appeal filed against j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, by that itself it cannot be inferred that they are not instrumentalities of the State. 79. The learned Counsel lastly contended that Section 26(1)(c) of the Act is vague, irrational and discriminatory, and violates Article 14, so it is unconstitutional. 80. The Section 26(1)(c) of the Act disqualifies a person holding office of profit under 'other authorities'. It is contended that the Members of Parliament and Members of Legislative Assemblies are nominated as members of the Corporation Council. Though they are holders of office of profit under Government Companies falling with 'other authorities' in terms of Article 12 of the Constitution of India, they are permitted to be the nominated members of Council, whereas the persons holding office of profit in Government Company are disqualified from contesting elections to the Corporation Council. So, it is discriminatory. Article 14 of the Constitution lays down the doctrine of equality as a bed-rock of rule of Law. The principle of equality does not mean that every law must have universal application for all persons who are not by nature, attainment and circumstance in the same position as the varying needs o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar object or purpose need not be all embracing. It is for the Legislature to determine what categories it would embrace within the scope of legislation and merely because certain categories which would stand on the same footing as those which are covered by the legislation are left out would not render legislation which has been enacted in any manner discriminatory and violative of the fundamental right guaranteed by Article 14 of the Constitution . The principle laid down in the above decisions squarely supports our view. Therefore, the contention that the provision is discriminatory is not tenable. 83. It is further contended that sub-section empowered the Government to make rules exempting from disqualification to the holders of office of profit under 'other authorities' or Government and therefore, the power conferred on the Government is vague, unguided, therefore it is arbitrary. The power is provided to the Government to frame rules for giving exemption from disqualification. No rules are framed till now and no such rules are brought to our notice and no instance of granting exemption is brought to our notice. 84. Learned Counsel for petitioners contended th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther hand, are a tremendously large number of employees of Public Corporations to be denied the opportunity of being chosen, as representatives of the people? Do all the considerations applicable to Government employees equally apply to employees of Public Sector Undertakings? Is there no distinguishing feature? Are a large mass of highly or moderately literate people to be denied the right to speak for the people? Is the right to be elected, to be confined, without meaning, any disrespect to any one to the professional politicians only? These are some of the vital questions posed and which require to be answered. The answer should be best given by the elected representatives of the people themselves.... . This makes it clear that the policy to provide disqualification and to which section of people it has to be provided and for whom it is not to be provided are all the questions to be decided by the Parliament and Legislatures. This principle supports our view. 87. The interpretation of the statute should keep pace with the change of times. Therefore, interpretation of the words 'other authority' keeping in with the tune of the intention of the legislature is quite p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) lack of legislative competence and (2) violation of any of the fundamental rights guaranteed in Part I of the Constitution or of any other constitutional provision. There is no third ground. We do not wish to enter into a discussion of the concepts of procedural unreasonableness and substantive unreasonableness--concepts inspired by the decisions of United States Supreme Court. Even in U.S.A. these concepts and in particular, the concept substantive due process have proved to be of unending controversy, the latest thinking tending towards a severe curtailment of this ground (substantive due process). The main criticism against the ground of substantive due process being that it seeks to set up the Courts as arbiters of the wisdom of the Legislature in enacting the particular piece of legislation. It is enough for us to say that by whatever name it is characterised, the ground of invalidation must fall within the four corners of the two grounds mentioned above. In other words, say, if an enactment is challenged as violative of Article 14, it can be struck down only if it is found that it is violative of the equality clause/equal protection clause enshrined therein. Similarly, if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the control of Uttar Pradesh Board is a disqualification under Article 191(1)(a) of the Constitution. The Apex Court referred the Uttar Pradesh Basic Education Act, 1972 (U.P. Act No. 34 of 1972) and the Bill, i.e., Uttar Pradesh Basic Education Bill, 1972, in pursuance of which, Act was passed; after referring all the provisions, the Court found that the Board for all practical purposes is a department of the Government and its autonomy is negligible. Therefore, the teacher who is holding an office of profit in a Primary School controlled by the Board is holding an office under the State Government and so his nomination was right to be rejected. 92. The Supreme Court in Satrucharla Chandrasekhar's case, supra, has considered whether a teacher working in a Primary School run by the Integrated Tribal Development Agency (ITDA) is holding an office of profit under State or not. 93. The Apex Court considered the earlier judgments of the Courts in: (i) Ravanna Subbanna v G.S. Kaggeerappa. (ii) Maulana Abdul Skakur v Rikhab Chand. (iii) M. Ramappa v Sangappa. (iv) Gopal Kurup v S.A. Paul. (v) Kona Prabhakara Rao v M. Sheshagiri Rao. (vi) Guru Gobinda Basu v S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve control over the Appointing Authority but has no direct control over the teachers. The small post that appellant holds in ITDA is only that of a teacher who is directly under the control of the Project Officer. In such a situation the question of any conflict between his duties and interests as an elected member does not arise since it cannot be said that he, as a teacher, can be subjected to any kind of pressure by the Government which has neither the power to appoint him nor to remove him from service . 95. Taking all these facts into consideration the Apex Court expressed a view that the appellant cannot be held to be holding an office of profit under the Government. 96. The facts of the above case are quite different from the facts of Biharilal Dobray's case, supra. Therefore, there is no change of position in law after the above judgments of the Supreme Court which confine to their own facts. 97. Therefore, the reference is answered accordingly. ORDER Authored By : R.V. Raveendran, N.S. Veerabhadraiah R.V. Raveendran, J. W.P. Nos. 43146 of 1995 and 28766 and 28842 of 1996 1. The petitioners are employees of Bharat Earth Movers Ltd. [BEML] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndertakings, from being chosen as Councillors of Municipal Corporations. While fully agreeing with the reasoning and decision [of learned Acting Chief Justice] on the first question, with respect, I am unable to agree that Government Companies (like BEML and ITI) fall under the expression 'other authority, subject to the control of Government', used in Section 26(1)(c) of the Act and therefore its employees are disqualified for being chosen as Councillors. I will briefly indicate the reasons therefore. 5. Section 25 of the KMC Act read with Sections 22 and 23 of the said Act and Sections 16 and 19 of the Representation of the People Act, 1950, provides that every adult citizen of India [not of unsound mind], whose name is included in the Electoral Roll of any division of the city is qualified for election as a Councillor. Section 26 contains the disqualifications for becoming a Councillor. A right to contest elections, though not a fundamental or common law right, it is a statutory right fundamental to democracy. A common man, may consider the right to own property or the right to participate in elections, to be as important as the fundamental rights. The right of eve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y' as a group of persons with official responsibility for a particular area of activity and having a moral or legal right or ability to control others. 6.4 The expression 'Authority' in its etymological sense means 'a Body invested with power to command or give an ultimate decision, or enforce obedience or having a legal right to command and be obeyed'. Webster's Dictionary of the English Language, defined 'authorities' as 'official bodies which control a particular department or activity, especially of the Government'. The expression 'other authorities' has been explained as 'authorities entrusted with a power of issuing directions, disobedience of which is punishable as an offence' or 'bodies exercising legislative or executive functions of the State' or 'bodies which exercise part of the sovereign power or authority of the State and which have power to make rules and regulations and to administer or enforce them to the detriment of the citizens'. 7. In the absence of any statutory definition or judicial interpretation to the contrary, the normal etymological meaning of the expression, has to be accepte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the candidate who was holding an office of profit under the company, but he did not incur disqualification under Article 191(1)(a). The Supreme Court referred to the distinction between disqualification under Articles 58(2) and 66(4) on the one hand and disqualification under Articles 102(1) and 191(1)(a) on the other and observed as follows: In this connection, a comparison between Articles 58(2) and 66(4) and Articles 102(1) and 191(1)(a) of the Constitution is of significant help. In Articles 58(2) and 66(4) dealing with eligibility for election as President or Vice-President of India, the Constitution lays down that a person shall not be eligible for election if he holds any office of profit under the Government of India or the Government of any State or under any local or other authority subject to the control of any of the said Governments. In Articles 102(1)(a) and 191(1)(a) dealing with membership of either House of Parliament or State Legislature, the disqualification arises only if the person holds any office of profit under the Government of India or the Government of any State other than an office declared by Parliament or State Legislature by law not to disqua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... even Parliament when passing the Act, did not consider it necessary to disqualify every person holding an office of profit under a Government Company, but limited the disqualification to persons holding the office of managing agent, manager or secretary of the company. The fact that the entire share capital in the company in the case before us is owned by the Government does not, in our opinion make any difference . What is extracted above will clearly show the question whether a Government company is an 'other authority' and whether an employee of a Government company was disqualified to contest elections having regard to a ban in regard to employees of 'other authorities under the control of the Government' did not arise at all for consideration in Gurushanthappa's case, supra, nor decided. The said decision is, therefore, of no assistance. 9. The respondents next contended that the expression 'other authorities' has been interpreted in Ajay Hasia's case, supra, and Som Prakash's case, supra, and the plethora of decisions following them, with reference to Article 12 of the Constitution and in the absence of any judicial interpretation in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 10. But, the question is whether the meaning given to the expression 'other authorities' for the purpose of Article 12, could be applied or extended to the expression 'other authority' in Section 26(1)(c) of the KMC Act. It should be remembered that expanded and widened definition of the expression 'other authority' in Article 12, is only for the purpose of extending the enforcement of fundamental rights against instrumentalities or agencies of the Government. There is no question of enforcement of fundamental rights in this case. The question is whether an employee of a Municipal Corporation is barred from contesting elections for being elected as Councillor of a Municipal Corporation. There is absolutely no connection or similarity of purpose between Article 12 and Section 26(1)(c). In such circumstances, the meaning assigned to the expression 'other authorities' in Article 12 cannot be extended to the said expression used in Section 26(1)(c) of the KMC Act. An elaboration of the reasons for this conclusion is necessary to assess their impact on the point at issue. 11. Re: Reason (i): 11.1 The several decisions which have included Govern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es under the deep and pervasive control of the Government, in the ambit of other authorities, in Ajay Hasia's case, supra and Som Prakash's case, supra, on the foundation laid in Ramana Dayaram Shetty's case, supra. It was held that an instrumentality or agency of the Government will fall within the scope of 'other authorities', irrespective of the fact whether the corporation was created by the statute or under a statute. Till the decision in Ajay Hasia's case, supra, and Som Prakash's case, supra, (both rendered on 13-11-1980), based on R.D. Shetty's case, supra, a Government company was never considered as 'other authority' for purposes of Article 12. 11.6 The reason for expanding the scope of 'other authorities' in Article 12 to include Government companies is stated thus in Ajay Hasia's case, supra: While considering this question it is necessary to bear in mind that an authority falling within the expression 'other authorities' is, by reason of its inclusion within the definition of 'State' in Article 12, subject to the same constitutional limitations as the Government and is equally bound by the basic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt. Now, it is obvious that if a corporation is an instrumentality or agency of the Government, it must be subject to the same limitations in the field of constitutional law as the Government itself, though in the eye of the law it would be a distinct and independent legal entity. If the Government acting through its officers is subject to certain constitutional limitations, it must follow a fortiori that the Government acting through the instrumentality or agency of a corporation should equally be subject to the same limitations. If such a corporation were to be free from the basic obligation to obey the fundamental rights, it would lead to considerable erosion of the efficiency of the fundamental rights, for in that event, the Government would be enabled to override the fundamental rights by adopting the stratagem of carrying out its functions through the instrumentality or agency of a corporation, while retaining control over it. The fundamental rights would then be reduced to little more than an idle dream or a promise of unreality. It must be remembered that the fundamental rights are constitutional guarantees given to the people of India and are not merely paper hopes or flee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t must not allow the enforcement of Fundamental Rights to be frustrated by taking the view that it is not the Government and therefore not subject to the constitutional limitations. We are clearly of the view that where a corporation is an instrumentality or agency of the Government, it must be held to be an 'authority' within the meaning of Article 12 and hence subject to the same basic obligation to obey the Fundamental Rights as the Government . The reason for including Government Companies in other authorities for purposes of Article 12 is stated in Som Prakash's case, supra, thus.- Imagine the possible result of holding that a Government Company, being just an entity created under a statute, not by a statute, it is not 'State'. Having regard to the directive in Article 38 and the amplitude of the other Articles in Part IV Government may appropriately embark upon almost any activity which in a non-socialist republic may fall within the private sector. Any person's employment, entertainment, travel, rest and leisure, hospital facility and funeral service may be controlled by the State. And if all these enterprises are executed through Government co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e a deep and pervasive control of the Government over the appellant-company and the appellant-company, on such account may be an instrumentality or agency of the Central Government and as such a State within the meaning of Article 12 of the Constitution. Even though the appellant-company is an agency or instrumentality of the Central Government, it cannot be held to be a department or establishment of the Government in all cases. Such instrumentality or agency has been held to be a third arm of the Government in Ajay Hasia's case, supra, but it should not be lost sight of that it was only in the context of enforcement of fundamental rights against the action of the Government and its instrumentalities or agencies it was held that such agencies were the third arm of the Government and they cannot avoid constitutional obligation. There is no question of enforcing any fundamental right in the instant case. On the contrary, the question of protecting the welfare of the employees vis-a-vis the instrumentality or agency of the Central Government under the Welfare Funds Act is to be kept in mind for the purpose of deciding the rival contentions of the parties. If Section 2(c) and (e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e share capital of these companies and the subsequent decisions of the Supreme Court in Tekraj Vasandi's case, supra and Chander Mohan Khanna v National Council of Educational Research and Training, wherein the Supreme Court has held that Article 12 should not be stretched so as to bring in every autonomous body which has some nexus with Government within the sweep of the expression 'other authorities'. 12. Re: Reason (ii): 12.1 The meaning to be assigned to words used in a statute should be contextual and not with reference to meaning assigned to the words in a provision of the Constitution of India or other statute which is not pari materia. To interpret the expression 'other authorities' used in Section 26(1)(c) of the Act, we have to examine the context in which the said section was enacted and how the said expression was understood at that time [in the year 1976]. 12.2 In Reserve Bank of India's case, supra, the Supreme Court held: Interpretation must depend on the text and the context. They are the bases of interpretation. One may well say if the text is the texture, context is what gives the colour. . . The interpretation is best which ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brought into existence by an act of a group of individuals, for the purpose of Section 21(12) of the Indian Penal Code. 13. Therefore, the expression 'other authority' should be interpreted with reference to the context of elections to Municipal bodies and disqualifications therefrom. The expression should also be understood with reference to the normal meaning that was attached to that expression in 1976 when the statute was enacted and not with reference to subsequent changes. 13.1 What should be the approach in interpreting provisions relating to disqualification, has been indicated by the Supreme Court in Madhukar G.E. Pankakar v Joswant Chobbildas Rajani: After all, all law is a means to an end. What is the legislative end here in disqualifying holders of 'offices of profit under Government'? Obviously to avoid a conflict between duty and interest, to cut out the misuse of official position to advance private benefit and to avert the likelihood of influencing Government to promote personal advantage. So this is the mischief to be suppressed. At the same time we have to bear in mind that our Constitution mandates the State to undertake multiform public ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39; only if such an uncouth expression may be allowed to creep into the judgment of a Court. Nowadays the activities of the State are so manifold and prolific that the State has been forced in the interests of better management and administration and in order to further the Directive Principles of State Policy, to set up various corporations which are but mere instrumentalities of the State is the principle of Article 191(1)(a) then to be extended to employees of State Corporations also by enacting appropriate laws under Article 191(1)(e)? Or are employees of Public Corporations to be treated differently from employees of the Government? Are not some of them in a better position to exert undesirable pressure than Government Employees? On the other hand, are a tremendously large number of employees of Public Corporations to be denied the opportunity to being chosen, as representatives of the People? Do all the considerations applicable to Government employees equally apply to employees of Public Sector Undertakings? Is there no distinguishing feature? Are a large mass of highly or moderately literate people to be denied the right to speak for the public? Is the right to be elected, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gory, are interested in the welfare of the area, where they reside. If they are elected, there will be no conflict between their duties and functions, as Councillors and their duties and functions, as employees of a public sector undertaking. The question of their misusing their position or power to any private benefit does not arise. In fact the said public sector undertakings have no say or influence in the affairs of the Municipal Authority. Therefore, they should not be excluded from participation in the running of the local authority unless the statute specifically bars or exclude them. Section 26(1)(c) of the Act is not intended to exclude the employees of the Government companies. The section as it stands applies only to employees of statutory corporations controlled by Government. 15. Consequently, there is no legal bar for the employees of BEML and ITI to contest and be elected as Councillors of Municipal Corporations governed by the Karnataka Municipal Corporations Act, 1976. DECISION OF THE FULL BENCH (a) The constitutional validity of Section 26(1)(c) of the Karnataka Municipal Corporations Act, 1976 is upheld. (b) As per the opinion of the majority (Ravee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingly answered the reference in the negative with which I fully concur with the reasonings and findings. 4. My learned Senior brother Justice R.V. Raveendran, formulated two important points for adjudication which reads thus: 1. Whether Section 21(1)(c) of the Karnataka Municipal Corporations Act is constitutionally valid? 2. Whether Section 26(1)(c) of the KMC Act disqualifies the employees of Government companies and public sector undertakings from being chosen as Councillors of the Municipal Corporation? 5. Learned brother observed that there cannot be two views that a Government company is 'other authority' and therefore 'State' within the meaning of Article 12 only for the purpose of Parts III and IV and not for the purpose of Part XIV or any other provisions of the Constitution. He held that there is no legal bar for the employees of the Bharath Earth Movers Limited (BEML) and Indian Telephone Industries (ITI) to contest and be elected as Councillors as the Municipal Corporation is governed by the Karnataka Municipal Corporations Act, 1976, for which I do not subscribe my views for the following reasons: 6. The points that arise for my conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion is, whether the employees of the BEML and Indian Telephone Industries are holding the office of profit and the Public Sectors do not come within the meaning of other authority. Insofar as, this aspect is concerned, the matter has stood at rest by the Apex Court in D.R. Gurushanthappa's case, supra, and also in Ajay Hasia's case, supra, where the Public Sector comes within the meaning of 'other authority' as defined under Article 12 of the Constitution of India. 11. Article 12 of the Constitution of India reads thus: 12. Definition.--In this part, unless the context otherwise 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 . A plain reading of the Article 12 and the expression of the words clearly denotes the word 'State' includes 'local' or 'other authorities'. Even in Section 26(1)(c) of the KMC Act, the word used is 'local' or 'other authorities'. The language used by the legislature abundantly makes it clear and us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly where one Act is ambiguous or some provision appears to be of doubtful meaning that the assistance is sought from another statute in pari materia to remove the doubt or ambiguity. It is only in such circumstances that assistance in ascertaining the meaning of an enactment is permitted under this rule to be obtained by comparing its language with the words given in an earlier statute relating to the same subject. English Income Tax Act is not in pari materia with Indian Act. But where different statutes deal with identical subjects at different times or deal with a person or thing for same purpose, they are in pari materia and they should be taken and considered together as one system and as explanatory of each other. Where words and expressions in a statute are taken from earlier statutes in pari materia which have received judicial construction, it must be assumed that the legislature was aware of such interpretation, and intended it to be followed in later enactment. A Judge, however, is not justified in construing one statutory provision by a decision dealing with interpretation of another statutory provision in the wordings of which are substantially different. It was held i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear and does not warrant the Court, the Court in subverting or defeating the legislative will by confining the operation of a statute within narrower limits than intended by the law makers. It should be resorted to not for the purpose of defeating the intention of the legislature but for the purpose of elucidating its words and giving effect to its intention. It is based on the idea that if the legislature intended its general words to be used in an unrestricted sense so as to embrace the objects, persons or things, covered by the particular words, it would not have taken the trouble of using the particular words at all. Whether the rule of ejusdem generis should be applied to a particular provision depends on its terms and the purpose and object the provision is intended to achieve. The fact that this particular rule has been applied to one provision is no indication that it should be applied to another provision even if it recurs in the same enactment. The rule of ejusdem generis is not one of universal application. It is merely a rule of construction and as such, it may be of no assistance and the intention of the legislature is so plain as to require no resort to cannons of con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtain authorities. The second part is generic and covers any other authority legally entitled to or entrusted by Government with the control and management of a municipal or local fund. In actual practice, it is the second part which is more important and a large number of authorities have been created in the field of local self-Government and other fields. The most important test for deciding whether or not an authority is a local authority or not within the meaning of Section 3(31) of the General Clauses Act is that the authority must be legally entitled to or entrusted by the Government with the control and management of a municipal or local fund . It is the second part which is applicable to the facts of this case. 15. Similarly, in Mysore General Clauses Act, 1899, Section 3(2) defines what is 'Local Authority' which reads thus: 'Local Authority' shall mean a municipal committee, district hoard or other authority legally entitled to, or entrusted by the Government with the control or management of a municipal or local fund . It has also the same meaning as connoted or other authority legally entitled to. 16. In the light of the expressions ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a. In the same book at page 1381, the expression other authority is defined which reads as follows: The expression 'other authorities' includes all public authorities, that is, authorities created by a statute endorsed with powers and functions in a given field of activity and for the control thereof, and having the power to make their own rules and regulations, having the force of law . 23. In the case on hand, the Public Sector is constituted under an enactment of the Parliament empowering it to frame its own rules and regulations controlling the service conditions like appointment, removal, dismissal, suspension etc., and at the same time providing for payment of the salary, increment, bonus etc., under the Industrial Law. In that view of the matter, the definition of Article 12 cannot be restricted to Chapters III and IV of the Constitution of India. 24. It is not in dispute that BEML as well as ITI are constituted under the Companies Act, 1956. Section 617 of the Companies Act reads thus: Definition of 'Government Company'.--For the purposes of this Act, Government Company means any company in which not less than fifty-one per cent of the pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tter; or (c) in respect of any other matter, shall be accompanied by such fee, as may be prescribed: Provided that different fees may be prescribed for application in respect of different matters or in case of applications by companies, for applications by different classes of companies . Section 637-A enables the Central Government to accord approval in respect of the matters provided. Section 642 of the Companies Act reads thus: 642. (1) In addition to the powers conferred by Section 641, the Central Government may, by notification in the Official Gazette, make rules.- (a) for all or any of the matters which by this Act are to be, or may be, prescribed by the Central Government; (b) generally to carry out the purposes of this Act. (2) any rule made under sub-section (1) may provide that a contravention thereof shall be punishable with fine which may extend to five hundred rupees and where the contravention is a continuing one, with a further fine which may extend to fifty rupees for every day after the first during which such contravention continues. (3) Every rule made by the Central Government under sub-section (1) shall be laid as soon as may be aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nctioning under the control and authority of the Government, in order to consider whether the employees of BEML and ITI are holding the office of profit or not. Article 245 of the Constitution of India reads as under: 245. Extent of laws made by Parliament and by the Legislatures of States.--(1) Subject to the provisions of this Constitution, Parliament may make laws for the whole or any part of the territory of India, and the legislature of a State may make laws for the whole or any part of the State. (2) No law made by Parliament shall be deemed to be invalid on the ground that it would have extra-territorial operation . It specifically provides for enactment of laws by the Parliament. Similarly, Article 246 of the Constitution of India reads as under: 246. Subject-matter of laws made by Parliament and by the Legislatures of States.--(1) Notwithstanding anything in clauses (2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule (in this Constitution referred to as the Union List ). (2) Notwithstanding anything in clause (3), Parliament, and, subject to clause (1), the legislat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mporarily placed at the disposal of the Government of India, the Government of another State, a local authority or any person whether incorporated or not, and also any person in the service of the Central or another State Government or a local or other authority whose services are temporarily placed at the disposal of the Government of Karnataka. Section 2(12) defines Public Servant . The relevant sub-sections read thus: Public Servant means a person who is or was at any time.- (g) a person in the service of pay of.-- (i) a local authority in the State of Karnataka; (ii) a statutory body or a corporation (not being a local authority) established by or under a State or Central Act, owned or controlled by the State Government and any other Board or Corporation as the State Government, having regard to its financial interest therein by notification, from time to time specify; (iii) a company registered under the Companies Act, 1956, in which not less than fifty-one per cent of the paid up share capital is held by the State Government, or/and company which is a subsidiary of such company; (iv) a society registered or deemed to have been registered under the Karn ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
