Constitution Law Project Concept Of State

PROJECT REPORT ON CONSTITUTIONAL LAW

Interpretation of “State” under Article 12 of The Indian Constitution

Submitted To:

Submitted By:

Dr. Shruti Bedi

Akhil Ahuja (124/13)

UILS, Panjab University

B.Com./LLB (Honors)

Chandigarh.

Semester 4th

Chapter 1

INTRODUCTION 1.1 Article 12 of the Constitution of India: The Constitution of India, Article 12 : “In this part, unless the context otherwise requires, “the State” includes the Government and the Parliament of India, the Government and the Legislature of each of the States, all local and other authorities within the territory of India or under the control of the Government of India.” Article 12 of the Constitution has four components:

(a) The Government and Parliament of India- Government means any department or institution of department. Parliament shall consist of the President, the House of People and Council of States. (b) The Government and Legislature of each State- State Legislatures of each State consist of the Governor, Legislative Council and Legislative Assembly or any of them. (c) Local Authorities within the territory of India (d) Other Authorities- Authorities other than local authorities’ working( i ) Within the territory of India or; ( ii ) Under the control of the Government of India.

1.2 Importance of Article 12: 1 | Page

The Constitution of India has defined the word ‘State’ for the purpose of Part III and Part IV. The State has been defined by different political thinkers. In Political theory for state to exist the Territory, Population, Sovereignty and Capacity to maintain international relation is important but this definition could not serve the purpose of enforcement of Fundamental Rights. Fundamental Rights constitute limitation on the power of the State and are a guarantee against State action. The Fundamental Rights are a protection against invasion of the rights by the State. So, Article 12 of Indian Constitution defines State against whom the fundamental rights can be claimed. Therefore, whether Constitution says or not, it is generally assumed that Fundamental Rights given in Part III are available against the State that is against the action of State and its officials.

1.3 Judicial Interpretation of Article 12: The definition of State in Article 12 is not exhaustive but inclusive, which means that apart from the bodies or organs which have been enumerated, others may also be covered by the expression State. In State of West Bengal v/s Subodh Gopal Bose1, the Supreme Court observed that the object of Part III of the Indian Constitution is to provide protection to the rights and freedoms guaranteed under this part by the invasion of ‘State’. Individuals need constitutional protection against the state. The rights which are given to the citizens by way of fundamental rights as included in Part III of the Constitution are guarantee against State action as distinguished from the violation of such rights from private parties. Private action is sufficiently protected by the ordinary law of land. Patanjali Sastri, CJ, said: “The whole object of Part III of the constitution is to provide protection for the freedoms and rights mentioned therein against arbitrary invasion by the state” In P.D. Shamdasani v. Central Bank of India2, the petitioner, in an application under Article 32 of the constitution, sought the protection of the court on the ground that his property rights under 1 AIR 1952 SC 59 2 Ibid. 2 | Page

Articles 19(1)(f) and 31 were infringed by the action of another private person – the central bank of India. The Supreme Court said that the language and structure of Article 19 and its setting in Part III of the Constitution clearly show that the Article was intended to protect those freedoms against state action other than in the legitimate exercise of its power to regulate private rights of property by individuals is not within the purview of this article.3 The term state thus includes executive as well as the legislative organs of the Union and States. It is therefore, the actions of these bodies that can be challenged before the courts as violating fundamental rights. The first two categories included the legislative and executive wings of the Union and State in all their possible varieties. They are quite specific and self explanatory. The latter two categories, particularly the last are not so specific and require some explanation. To give a wider dimension to Fundamental Rights the Judiciary has interpreted “State” in different context at different time.

Authorities: Authority means a person or body exercising power to command. In the context of Article 12, the word “authority” means authority who has the power to make laws, orders, regulations, bye-laws, notifications etc. which have the force of law and power to enforce those laws.

Other authorities: In article 12 ‘other authorities’ is used after mentioning a few of them, such as, the government, parliament of India, the government and legislature of each of the states and all local authorities. Courts have ruled that where there is pervasive or predominant governmental control or significant involvement in the activities, such bodies, entities and organizations fall within the definition of “the State”. As a result of judicial interpretation, “the State” has been held to include

statutory

bodies

such

as

insurance

corporations, nationalized

banks, airline

corporations, electricity boards, educational institutions and societies whose composition and 3 J.N. Pandey, The Constitutional Law Of India, Central Law Publisher, Allahabad, 2011, p. 59

3 | Page

administration are predominantly controlled by the government. Consequently the reach and extent of protection of fundamental rights has been widened and greater protection has been afforded especially in the area of employment against discriminatory practices. Again there are private, non-State entities which discharge important quasi-governmental or important public functions, which have repercussions on the life and welfare of the community. Such entities and bodies can be regarded as “the State” as would appear from the concurring opinion of Justice Mathew. “Institutions engaged in matters of high public interest or performing public functions are, by virtue of the nature of the functions performed, government agencies. Activities which are too fundamental to the society are by definition too important not to be considered government function”.4 The word ‘State’ under Article 12 has been interpreted by the courts as per the changing times .It has gained wider meaning which ensures that Part III can be applied to a larger extent which is discussed in Chapter 3 of the project. We hope that it would continue to extent its width in coming times.

Chapter 2 4 Sukhdev Singh v. Bhagatram, AIR 1975 SC 1331, 1355

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Interpretation of “Local Authority” In this Part, unless the context otherwise required, "the State" includes the Governmental 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. Fundamental Rights are available against the state. Article 12 of the Indian Constitution defines the State. State includes local authority.

2.1 Meaning of Local authority in General Clauses Act: Local authority is defined in sec 3(31) of General Clauses Act: "Local authority" shall mean a municipal committee, district board, and body of port commissioners or other authority legally entitled to, or entrusted by the Government with, the control or management of a municipal or local fund.” A proper and clear scrutiny of the language of Section 3(31) of General Clauses Act 1897 suggests that an authority, in order to be local Authority, must be of a like nature and character as a Municipal Committee, District Board or Body of Port Commissioners possessing therefore many if not all, of the distinctive attributes and characteristics of municipal Committee, District Board or Body of Port Commissioners, but possessing one essential feature, namely, that it is legally entitled to or entrusted by the Government, with the control and management of Municipal or local fund. Local bodies are subordinate branches of the Government activities. They are democratic institutions managed by the representative of the people. They function for the public purpose and take away a part of the government affairs in the local areas.

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2.2 Judicial interpretation of Local Authority: The distinctive attributes and characteristics of an authority to be a “local authority were noticed by Supreme Court in Union of India v R.C. Jain5. These briefly are:·  The authorities must have separate legal existence as cooperate bodies. They must not be mere government agencies but must be legally independent agencies.  They must function in defined area and must ordinarily, wholly or partly, directly or indirectly be elected by the inhabitants of the area.  Next they must enjoy a degree of autonomy with freedom to decide for themselves the questions of policy affecting the area administered by them. The autonomy may not be complete and the degree of dependence may vary considerably but, and appreciable measure of autonomy there must be.  They must be entrusted by statute with such governmental functions and duties as are usually entrusted to Municipal Bodies, such as those connected with providing amenities, to the inhabitants of the locality, like health and education services, water and sewerage, town planning and developments, roads, markets transportation , social welfare services etc. Broadly they may be entrusted with the performance of civic duties and functions which would otherwise be governmental duties/ functions.  Finally they must have the power to raise funds for the furtherance of their activities and the fulfillment of their projects by levying taxes, rates, charge of fees. This may be in addition to moneys provided by Government obtained by borrowing or otherwise. In Union of India v R.C.Jain,6 it was said “what is essential is that control and management of the fund must vest in the authority.” The Delhi Development Authority was held to be Local Authority because it was constituted for the specific purpose of development of Delhi according to plan which is limited to Delhi. It has some elements of popular representation in its composition and enjoys a considerable degree of autonomy. In Municipal Corporation of Delhi v Birla Cotton & Weaving Mills Delhi 7, Hidayatullah. J., described some of the attributes of Local Authorities in this manner: 5 AIR 1981 SC 951. 6 Ibid. 6 | Page

“Local Bodies are subordinate branches of Government activity. They are political sub-division and agencies which exercise a part of State functions (as they are intended to carry on local selfgovernment the power of taxation is a necessary adjunct to their other powers). They function under supervision of the Government”. In Valijbhai Muljibhai Soneji v State of Bombay,8 one of the questions was whether Trading Corporation was Local Authority as defined by Section 3(31) of the General Clauses Act, 1897. It was held that it was not, because it was not an authority legally entitled to or entrusted by the government with, control or management of a Local fund. It was observed that though the Corporation was furnished with funds by the Government for commencing its business that would not make the funds of the corporation. In, Calcutta State Transport Corporation v Commr. Of Income Tax, West Bengal,9 the Supreme court refused to characterize the corporation as a ‘Local Authority’. The corporation is meant only for the purpose of providing road transportation services and has no element of popular representation in its Constitution. Its powers and functions bear no relation to the powers and functions of the municipal committee. It is no more in the nature of a trading corporation. Expression Local Authority shall include Municipal Board as laid down in Rashid Ahmed v Municipal Corporation, Kairana10. The Supreme Court struck down a by-law framed by the respondent Municipal Corporation, which prohibited the establishment of a market for wholesale transactions in vegetables except with the permission of the Board. The by-law was held to impose unreasonable restriction on the fundamental rights of the petitioner contained in Article 19(1) (g) and hence void under Article 13(1) of the Constitution.

7 AIR 1968 SC 1232 8 AIR 1963 SC 1890 9 AIR1996 sc 1316 10 AIR 1950 SC 163 7 | Page

In Ajit Singh v State of Punjab,11 The Gram Panchayat was held to be a local Authority with the meaning of the term State under Article 12. Land acquired for the Panchayat was thus held as acquired under article 31-A(1) and (2) by the State. Local Authority also includes Town Area Committee 12, a Notified Area Committee13, Improvement Trust, a Mining Settlement Board, A Municipal Corporation, and a Port Trust.14 In P. Srivastava v Union of India,15 the Ramgarh Cantonment Board, created by the Cantonment Act, has been held to be a local authority and is therefore included in the term ‘State’ within the meaning of Article 12. Whether Mines Board of Health constituted under the Bihar and Orissa Mining Settlement Act 1920 is a ‘Local Authority’ was considered by Supreme Court in Surya Kant Roy v Imanul16 and the court observed that the board is not wholly under the control of the state government in all its functions. The board levies taxes and other assessment and has got its own funds. The fact that government and local authorities must grant fund to the board does not mean that all funds of the board are Government Funds. It was held that board is a local authority within the meaning of the expression as defined in Section 3(31) of General Clauses Act 1897. Article 12 does not define Local authority but defines State. In Housing Board of Haryana v Employees’ Union,17 the question posed for the consideration before the Supreme Court as to whether Housing Board of Haryana is a ‘Local Authority’ within the meaning of Sec32(iv) of the 11 AIR 1967 SC 856 12 Mohd. Yasin v Town Area Committee, Jalalabad, AIR 1952 SC 115 13 Sri Ram v The Notified Area Committee, Khatauli, AIR 1952 SC 118 14 J.H.wadia v Board of Trustees, Port of Mumbai, AIR 1985 SC 1415 15 AIR 1996 SC 212 16 AIR 1975 SC 1053 17 AIR 1996 SC 434 8 | Page

Payment of Bonus Act 1965. The Supreme Court Observed that the functions as are indicated in the housing scheme are essentially performed by Municipal Boards and Municipal Council which, undoubtedly are “Local Authorities” but on that analogy the Haryana Housing Board cannot be treated as “Local Authority” as the extent of the control of the State Government under which the Board had to function is so prominently pervasive that is almost destructive to its independence which will also be apparent from the facts that in matters of settlement of its annual programmes, budget and establishment schedule, the board has to obtain the sanction of the State Government. The housing Board does not have the semblance of independence which are normally possessed by the Local Self-government. The board not even partially consists of elected representative of the people. The legislature itself has given the status of Local Authority only for the purpose of Land Acquisition Act. It is local authority for limited purposes. The legislature could well have given this status to the board for the purpose of the Payment of Bonus Act but this has not been done and so it cannot be treated as a local authority under Payment of Bonus Act.

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Chapter 3 Interpretation of “Other Authorities”- Judicial Evolution The interpretation of the term “other authorities” in Article 12 has caused a good deal of difficulty, and judicial opinion has undergone changes over time. Today’s government performs a large number of functions because of the prevailing philosophy of a social welfare state. The government acts through natural persons as well as juridical persons. Some functions are discharged through the traditional governmental departments and officials while some functions are discharged through autonomous bodies existing outside the departmental structure, such as, companies, corporations etc.18 While the government acting departmentally, or through officials, undoubtedly falls within the definition of ‘state’ under Article 12, doubts have been cast as regards the character of autonomous bodies. Whether they could be regarded as ‘authorities’ under Article 12 and, thus, be subjected to Fundamental Rights? The judicial trend with regard to the interpretation of term “other authorities” can be understood by studying the case laws. In University of Madras v Shanta Bai19 the Madras High Court held that ‘other authorities’ could only indicate authorities of a like nature, i.e. ejusdem generis. Ejusdem generis is a Latin 18 M.P. Jain, Indian Constitutional Law. Nagpur: Lexis Nexis, 2012. p.907. Print. 19 AIR 1954 Mad 67. 10 | P a g e

phrase which means “of the same kind.” As a legal term it refers to a principle for interpreting the language of a statute. The rule of ejusdem generis says that when a generic description follows specific items, the more generic description is read to apply only to things belonging to the same group or class as the specific items. So construed, it could only mean authorities exercising governmental or sovereign functions. In cannot include persons, natural or juristic, such as, a University unless it is ‘maintained by the State’. However, this view of Madras High Court has not been accepted by the Supreme Court. This restrictive interpretation of other authorities was rejected by Supreme Court in Ujjammbai v. State of U.P.20 Supreme Court observes that Article 12 winds up the list of authorities falling within the definition by referring to “other authorities” with in the territory of India which cannot, obviously, be read as ejusdem generis with either the Government and the Legislature or local authorities. The words are of wide amplitude and capable of comprehending every authority created under the statute and functioning within the territory of India. In Article 12 the bodies specifically named are the Government of the Union and the States, the Legislation of the Union and the States and local authorities. There is no common genus running through these named bodies nor can these bodies so places in one single category on any rational basis. Consequently, it must include every type of authority set up under a statute for the purpose of administering laws enacted by the Parliament or by the State including those vested with the duty to make decisions in order to implement those laws.

3.1 Statutory Authority: Definition of State is not narrow. It includes all such entities that are constituted by the State. Considerable light is thrown on what are the ‘other authorities’ contemplated by Article 12 which falls within the definition of the State by the Supreme Court in Rajasthan State Electricity Board v. Mohan Lal.21 This was the case in which court was called upon to consider whether Rajasthan Electricity Board was an authority within the meaning of the expression “other authorities” in Article 12. Bhargava J., delivering the judgment of the majority pointed out that 20 AIR 1962 SC 1621. 21 AIR 1967 SC 1857. 11 | P a g e

the expression “other authorities” in Article 12 could include all constitutional and statutory authorities on whom powers were conferred by law. The judge also said that if anybody of persons, had authority to issue directions the disobedience of which would be punishable as a criminal offence, that would be an indication that authority was state. Shah J., who delivered a separate judgment, agreeing with the conclusion reached by the majority, preferred to give a slightly different meaning to the expression “other authorities”. He said the authorities, constitutional or statutory, would fall within the expression “other authorities” only if they are invested with the sovereign power of the state, namely the power to make rules and regulations which have the force of the law. The ratio of this judgment, thus, is that a constitutional or statutory authority would be within the meaning of the expression “other authorities”, if it had been invested with statutory power to issue binding directions to third parties, the disobedience of which would entail penal consequence or it had sovereign power to make rules and regulations having the force of law. In context of this case, the Supreme Court in Sukhdev v. Bhagatram22 considered the meaning of the word “other authorities” as provided in Article 12 of the Constitution. The Court held that the rules and regulations framed by the Oil and Natural Gas Commission, the Life Insurance Corporation and the Industrial Finance Corporation are all States because the rules and regulations made by them have the force of law. The employees of these statutory bodies have a statutory status and they are entitled to the declaration of being in employment when their removal or dismissal is in the contravention of the statutory provisions. The Court held that these statutory bodies are “authorities” as provided under Article 12 of the Constitution. Justice Mathew in his concurring judgment advocated the new evolving concept of the state acting through a corporation and making it an agency or instrumentality of the State which found support in subsequent decisions of the Supreme Court. He was pleased to the reason that the State is an abstract entity and it can only act through the instrumentality or agency of natural or juridical persons. Therefore, there is nothing strange in the notion of state acting through a corporation and making it an agency or instrumentality of the state. He observed that the Corporations were agencies or the instrumentalities of the state as the Central Government contributed the original capital of the Corporation and large part of profit went to the Central 22 AIR 1957 SC 1331. 12 | P a g e

Government and the Government exercised control over the Corporations and the Corporations discharged the functions of great public importance. In order to analyze the link between the State and undertaking in question, it was necessary to evolve some formula; and that is the principal approach adopted by the Supreme Court in its well known judgment in Ramana Dayaram Shetty v. The International Airport Authority of India. 23 International Airports Authority is a body corporate constituted under the International Airports Authority Act, 1971. The Director of the Authority had issued a notice, inviting tenders for putting up and running a second class restaurant and two snack bars at the International Airport at Bombay. Tenders were received in response to the notice. Shri R.D. Shetty, the appellant, who was not a tenderer, filed a writ petition which was rejected by the Bombay High Court. He applied for and obtained the special leave to Appeal in the Supreme Court. He urged that the notice inviting tenders by the Airports Authority had stipulated a condition of eligibility, but subsequently same was changed without any rational justification, as a result of which he could not submit his tender. It was further urged before the Supreme Court that the International Airport Authority being a ‘state’ within the meaning of Article 12 of the Constitution, was bound to give effect to the condition of eligibility set up by it was and not entitled to depart from it at its own sweet will without rational justification. The Airports Authority contended that since the appellant had not submitted any tender, he had no locus standi to maintain the petition and he had suffered no injury by the grant of license to one of the respondents. In further raised the contention that the condition of eligibility had no statutory force. Therefore, even if there was any departure from the standard or norm of eligibility, it was not justiciable. The Supreme Court dismissed the appeal on the ground that the appellant had not submitted any tender and he had suffered no injury. Nevertheless, it held that “where the government is dealing with the public, whether by the way of giving jobs or entering into contracts or issuing quotas or licenses or granting other forms of largesse, the Government cannot act, arbitrarily and its sweet will, and, like a private individual deal with any person it pleases, but its action must be in conformity with a standard or norm which is not arbitrary, irrational or irrelevant. The power or discretion of the Government in the matter of grant of largesse including award of jobs, contracts, quotas, licenses, etc. must be confined and structured by rational, relevant and non23 AIR 1979 SC 1628. 13 | P a g e

discriminatory standard or norm and if the Government departs from such norm or standard in any particular case or cases, the action of the Government would be liable to be struck down, unless it can be shown by the Government that the departure was not arbitrary, but was based on some valid principle which in itself was not irrational, unreasonable or discriminatory.” After making the aforesaid observation, the Supreme Court further held that corporations established by statute or incorporated under law are an instrumentality or agency of the Government, if they satisfied certain tests which may be summed up as under:

i. ii.

The source of the share capital; The extent of the State control over the Corporation, and Whether it is “deep and

iii. iv.

pervasive”; Whether the Corporation has a monopoly status; Whether the functions of the Corporation are of public importance and closely related

v.

to governmental functions; and Whether, what belonged to a Government Department formerly was transferred to the Corporation.

After laying down the aforesaid tests, the Supreme Court observed that the list is not exhaustive and by its very nature, it cannot be, because, with increasing assumption of new tasks, growing complexities of management and administration and the necessity of continuing adjustment in relations between the Corporation and Government, calling for flexibility, adaptability and innovative skills, it is not possible to make exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a Corporation is a governmental instrumentality or agency.

3.2 State and its instrumentalities: Various factors for determining whether a body is agency of state has been laid down in Ajay Hasia v. Khalid Mujib24:

24 (1981) 1SCC 722: AIR 1981SC 487 14 | P a g e

a)

If the entire share capital of the corporation is held by the government, it would go for long

way towards indicating that the corporation is an instrumentality or an authority of the government. b)

Where the financial assistance of the state is so much as to meet almost entire expenditure of

the corporation it would afford some indication of corporation being impregnated with the government character. c)

Whether the corporation enjoys monopoly status which is state conferred or state protected.

d)

Existence of deep and pervasive state control may afford an indication that the corporation is

a state agency or instrumentality. e)

If the function of the corporation are of public importance and closely related to

government functions, it would be relevant factor in classifying a corporation as an instrumentality or agency of the government. f)

If a department of government is transferred to corporation, it would be strong factor

supporting the inference of the corporation being an instrumentality or agency of the government. In the case of Ajay Hasia v. Khalid Mujib,25 the question raised was whether the Regional Engineering College, Srinagar, established, administered and managed by a society registered under the J&K Registration of Societies Act, was State within the meaning of Article 12. Justice P. N. Bhagwati speaking for a unanimous five-judge bench reiterated that the test for determining whether a corporation falls within the definition of State in Article 12 was an instrumentality or agency of government. The enquiry must be not how the juristic person was born but why was it brought into existence. It was therefore immaterial whether the corporation was created by a statute or under a statute. The concept of instrumentality or agency of the government was not limited to a corporation created by a statute but was equally applicable to a company or society considering the relevant factors.

25 Supra. 24 15 | P a g e

Considering the tests formulated in Ajay Hasia case26, and holding that the tests so laid down, were not a rigid set of principles, so that if a body fell within any of them, it must, ex hypothesis, be considered to be a state within the meaning of Article 12, the majority ruled that the question in each case would be – “whether in the light of cumulative facts as established, the body is financially, functionally and administratively dominated by or under the control of Government. Such control must be particular to the body in question and must be pervasive. If it was found that the control of the Government was merely regulatory whether under Statute or otherwise, it would not serve to make the body, a state, the court held.27 Explaining and criticizing the decision in Ajay Hasia case, the minority, consisting the two learned judges, said that the tests laid down in that case were relevant for the purpose of determining whether an entity was an instrumentality or agency of the state and that simply by holding a legal entity to be an instrumentality or agency of the state, it did not necessarily became an authority within the meaning of “other authorities” in Article 12. “To be an authority”, the learned judges opined, “the entity should have been created by a Statute or under a statute and functioning with liability and obligations to the public.” Applying the tests laid by the Apex Court in Pradeep Kumar Case,28 a Divisional Bench of the Supreme Court in G. Bassi Reddy v. International Crops Research Institute,29 held the respondent institute is not covered by Article 12. The institute is an International Organization, set up as a non-profit research and training centre, with the object to help developing countries in semi-arid tropics to alleviate rural poverty and hunger in ways that are environmentally sustainable. Not set up by the Government, the institute gives its services voluntarily to a large number of nations besides India. It is not controlled by, neither it is accountable to the Government. The Indian Government’s financial contribution to the Institute is minimal and is participation in administration of the Institute is limited to 3 out of 5 members. 26 Ibid. 27 Pradeep Kumar v. I.I.C.B., (2002) 5 SCC 111. 28 Supra 27. 29 AIR 2003 SC 1764. 16 | P a g e

It was laid down that The Indian Statistical Institute 30, Indian Council of Agricultural research 31, Sainik School Society32, U.P. State Co-operative Land Development Bank Ltd.33 , U.P Rajya Karamchari Kalyan Nigam34, all societies registered under the Societies Registration Act; Project and Equipment Corporation of India Ltd. 35 a government of India undertaking; Food Corporation of India36, a statutory corporation; The Steel Authority of India Ltd, a Public Limited company owned, controlled and supervised by the Central Government 37; Mysore Paper Mills Ltd, a State Government Company38; The Indian Oil Corporation, a company registered under the Companies Act, 195639; a State-aided school, whose employees enjoy statutory protection and which is subject to the regulations made by the State education department 40; a medical college run by

30 B.S. Minhas v. Indian Statistical Institute, (1983) 4 SCC 582: AIR 1984 SC 363. 31 P.K. Ramchandra Iyer v. Union of India, (1984) 2 SCC 141. 32 All India Sainik School Employees Association v. Sainik School Society AIR 1988 SC 88. 33 P. State Co-operative Land Development Bank Ltd. V. Chandra bhan Dubey AIR 1999 SC 753. 34 Virendra Kumar Srivastav v. U.P Rajya Karamchari Kalyan Nigam, (2005) 1 SCC 149 35 A. L. Kalra v. Project and Equipment Corporation (1984) 3 SCC 316 36 Workmen v. Food Corporation of India, (1985) 2 SCC 136 37 Bihar State Harizan Kalyan Parishad v. UOI (1985) 2 SCC 644 38 Mysore Paper Mill Ltd. v. Mysore Paper mill Officer’s Association (2002) 2 SCC 167 39 Mahabir Auto Stores v. Indian Oil Corporation (1990) 3 SCC 752 40 Mnamohan Singh Jaitli v. Governer, UT of Chandigarh 1984 suppl SCC 540 17 | P a g e

municipal corporation41; several State electricity boards42 created on the lines of Rajasthan Electricity Board; Central Inland Water Transport Corporation Ltd, a government company jointly owned by Central government and two State governments 43; a Government Company constituted as development authority under a State Town Planning Act; regional rural banks established under the Regional Rural Banks Act,1976; port trusts created under the Major Port Trusts Act, 1889 or 1963 have been held ‘other authorities’ within the meaning of Article 12. In M.C. Mehta v. Union of India44, without deciding the question finally, Justice Bhagwati advanced strong arguments for including the non-governmental companies within the meaning of state.

41 Dinesh Kumar v. Moti lal Nehru Medical College, Allahabad (1985) 3 SCC 542 42 Rohtas Industries Ltd. v. Bihar S.E.B, 1984 supp SCC 161 43 Central Inland Water Transport Corporations Limited v. Brojonath Ganguly (1986) 3 SCC 156 44 (1987) 1 SCC 395 18 | P a g e

Chapter 4 Judiciary- Is It a Part of the State? Judiciary is the prominent organ of the State. Legislature frames the law and executor organ implements them and enjoys vast power of delegated legislation as well. One of the most important functions of Judiciary is to check invasion of fundamental right by these two organs and their instrumentality. Judiciary is to turn down the rules, regulations, which are in clear violation of fundamental rights. So judiciary act in three different capacities: a)

As a rule making authority

b)

As an administrative authority

c)

Act judicially

Judiciary is part of State or not depends upon the capacity in which it acts. When judiciary acts in its judicial capacity, it is not included within the meaning of “other authorities” and therefore, it is not a State under Article 12. But when judiciary acts in administrative capacity, it is in included within the meaning of “other authorities” and therefore, it is State under Article 12. If judiciary acts in administrative capacity or exercises administrative function or make rules and its actions or rules contravene Fundamental Rights, they may be challenged in the Court.

4.1 Judiciary in its Administrative and Rule making capacity: In Paramatam Sharan v Chief Justice 45 it was held that when Chief Justice of the High Court or Supreme Court appoints officer of the Court in the exercise of his power of appointment and the appointment made by him contravene the Fundamental Rights, they may be challenged in the Court because when Chief Justice of the High Court or Supreme Court makes appointment

45 AIR 1964 Raj. 13 19 | P a g e

officer of the Court the exercise of his power of appointment, he acts in administrative capacity and therefore, he is included within the meaning of term “State” under Article 12. In Prem Chand Garg v/s Excise Commissioner U.P.46 the question related to the rule making power of the Supreme Court, conferred by Article 145 for regulating, generally, the practice and procedure of the Court. Rule 12 of Order 35 made by Supreme Court, provided that the court might in the proceeding to which the said Order applied, impose such terms as to costs and as to giving of security, as it considered fit. A petition under Article 32 was one such proceeding covered by Order 35. By the petition under Article 32, the petitioner has challenged the validity of an order of the Excise Commissioner refusing permission to the distillery to supply power alcohol to the petitioner. The petition was admitted, but, acting under the impugned Rule, the Court directed the petitioner to deposit a security of Rs.2500/- in cash within 6 weeks, as a condition precedent for issuing rule nisi to the impleaded respondents. The petitioner having failed to collect the requisite fund, challenged the validity of Rule 12 of Order 35 and contended that the said Rule was ultra vires as it contravened their Fundamental Right guaranteed by Article 32. Gajendragadhkar, J. speaking for the majority, held that impugned Rule invalid, as it retarded the assertion or vindication of the Fundamental Right to move to the Supreme Court under Article 32. The Rules framed under Article 145, the Court held are framed in the exercise of the delegated power of legislation, and the said power could not be exercised so as to affect the Fundamental Rights. Likewise, the Chief Justice, in exercising powers of appointment of officer under Article 146, shall be amenable to the writ jurisdiction, if appointments are made in violation of Article 14-16 of the Constitution. It is thus be stated that “Judiciary” while exercising its rule making power would be covered by the expression “State” within meaning of Article 12.

46 AIR 1963 SC 996 (1004). 20 | P a g e

4.2 Judiciary in its judicial capacity: The Court in Ratilal v State of Bombay47 expresses the view that the judgment of the court cannot be challenged for violation of Fundamental Rights. The Mysore High court in Keshavan Iyenger v State of Madras,48 held that equal protection clause of Article 14 applies to the Judiciary with the same force and Spirit. However the view of the Supreme Court does not appear to be consistent. In Budhan v State of Bihar49 the Supreme Court held that the guarantee of equal protection under Article 14 of the constitution extends to all the three organs of the State viz executive, legislative and Judicial. The arbitrary and unreasonable judicial decisions are subjected to judicial review by the superior courts. In Naresh Kumar v State of Maharashtra 50 the issue posed before the Supreme Court for consideration whether judiciary is covered by the Expression ‘State’ in Article 12 of the Constitution. In this case a suit relating to claim of damages, for the publication of the English weekly “Blitz” an alleged malicious libel, was being heard by Mr. Justice Tarkunde of the Bombay High Court. During the pendency of the suit, the learned Judge orally directed the Petitioner that the evidence of a witness should not be published in the Blitz. The petitioner felt aggrieved by the said oral order and moved the Supreme Court under Article 32 and contended that the order had infringed his fundamental right contained in Article 19(1)(a) of the Constitution. Dismissing the writ petition Court ruled that: When a judge deals with the matters brought before him for his adjudication, he first decides question of fact on which the parties are at issue, and then applies the relevant Law to the said facts. Whether the findings of facts recorded by the Judge are right or wrong, and whether the 47 AIR 1954 SC 388; AIR 1953 Bom 242. 48 AIR 1956 Mys 20 49 AIR 1955 SC 191 50 AIR 1967 SC 1 21 | P a g e

conclusion of law drawn by him suffers from any infirmity can be considered and decided if the party aggrieved by the decision of the Judge takes the matter before appellant Court. So, the Court held that Fundamental right is not infringed by order of Court and no writ can be issued to High Court. In Naresh the majority judgment held that the scope of the jurisdiction of this Court dealing with writ petitions under Art. 32 was examined by a Special Bench of this Court in Smt. Ujjam Bai v. State of Uttar Pradesh51, The decision would show that it was common ground before the Court that in three classes of cases a question of the enforcement of the fundamental rights may arise; and if it does arise, an application under Article 32 will lie. These cases are: (1) where action is taken under a statute which is ultra vires the Constitution (2) where the statute is intra vires but the action taken is without jurisdiction; and (3) where the action taken is procedurally ultra vires as where a quasi judicial authority under an obligation to act judicially passes an order in violation of the principles of natural justice. But in the case the Supreme Court expressed the view that the Regional Transport Authority while acting as a quasi judicial body, its decisions cannot be challenged as violative of Article 14 of the constitution. Close scrutiny of the observation of the Supreme Court would reveal that the fundamental rights are not available against the Judiciary. The court held that violation of Fundamental Rights under Article 14 cannot be setup against the decision of the RTA52 Finally in Rupa Ashok Hurra v Ashok Hurra53 a constitutional bench of 5 judges held that no judicial proceeding could be said to violate any of the Fundamental Rights. Even though this is the settled law, the observation in Naresh Mirajkar v. State of Maharashtra 54 it is observed that

51 AIR 1962 SC 1621 52 Ujjam Bhai v State of UP, AIR 1962 SC 1621 53 AIR 2002 SC 1771 54 AIR 1967 SC 1 22 | P a g e

while exercising the rule making powers the judiciary is covered by the expression state with Art.12 but while performing its judicial functions it is not so included.

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Chapter 5 CONCLUSION Since 17th century if not earlier, human thinking has been veering round to the theory that man has certain essential, basic, natural and inalienable rights or freedoms and it is the function of the State, in order that human liberty may be preserved, human personality developed, and an effective social and democratic life promoted, to recognize these rights and freedoms and allow them a free play. The concept of human rights protects individuals against the excesses of the state. The concept of human rights presents an attempt to protect the individual from oppression and injustice. In modern times, it is widely accepted that the right to liberty is the very essence of a free society and it must be safeguarded at all times. The idea of guaranteeing certain rights is to ensure that a person may have a minimum guaranteed freedom. Part III of the Constitution protects substantive as well as procedural rights. Articles 12-35 of the Constitution pertain to Fundamental Rights of the people. Most of the Fundamental Rights are claimed against the State and its instrumentalities and not against private bodies. 55 Article 13(2) bars the ‘state’ from making any ‘law’ infringing a Fundamental Right. According to Article 13(2), the State ‘shall not make any law, which takes away or abridges the Fundamental Rights; and a law contravening the Fundamental Rights is, to the extent of that contravention, void. It is the crucial constitutional provision which deals with the postconstitution laws. If any such law violates any Fundamental Right it becomes void ab initio, i.e., from its inception. The effect of Article 13(2) thus is that no Fundamental Right can be infringed by the state either by legislative or administrative action. The two important concepts used in this provision are: ‘state’ and ‘law’. These concepts thus, need some elucidation. Fundamental Rights are mostly claimed against the ‘state’. Article 12 gives an extended significance to the term ‘state’. Article 12 clarifies that the term ‘state’ 55 Shamdasani v. Central Bank of India, AIR 1952 SC 59. 24 | P a g e

occurring in Article 13(2), or any other provision concerning Fundamental Rights, has an expansive meaning. The action of the any of the bodies comprised within the term ‘state’ as defined in article 12 can be challenged before the courts under Article 32 on the ground of violating Fundamental Rights. The most significant expression used in Article 12 is “other authorities”. This expression is not defined in the Constitution. The interpretation of the term “other authorities” in Article 12 had caused a good deal of difficulty, and judicial opinion has undergone changes over time. It is, therefore, for the Supreme Court, as the Apex Court, to define this term. It is obvious that wider the meaning attributed to the term “other authorities” in Article 12, wider will be the coverage of the Fundamental Rights, i.e., more and more bodies can be brought within the discipline of Fundamental Rights. The reason for adopting such broad view is that the Constitution should, whenever possible, “be so construed as to apply to arbitrary application of power against individuals by centers of power. The emerging principle appears to be that a public corporation being a creation of the state is subject to the Constitutional limitation as the state itself”. Again there are private, non-State entities which discharge important quasi-governmental or important public functions, which have repercussions on the life and welfare of the community. The word ‘State' under Article 12 has been interpreted by the courts as per the changing times .It has gained wider meaning which ensures that Part-III can be applied to a larger extent. As a result of judicial interpretation, “the State” has been held to include statutory bodies such as insurance corporations, nationalized banks, airline corporations, electricity boards, educational institutions and societies whose composition and administration are predominantly controlled by the government. Consequently the reach and extent of protection of fundamental rights has been widened and greater protection has been afforded especially in the area of employment against discriminatory practices. Thus, it is hoped that it would continue to extent its width in coming times.

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