o The Government and Parliament of India; (union)
o The Government and the Legislature of each of the States; (states)
o All local authorities; and (municipalities, district boards, panchayats, improvement trusts, port trusts, mining settlement boards)
o Other authorities within the territory of India or under the control of the Government of India.
- Most of the litigation is based on what falls within ‘other authorities’ given in this article
- Pre Rajasthan Electricity Board case, courts took a very narrow interpretation of Article 12.
P.D. Shamdasani v Central Bank of India Ltd. (1952)
- The petitioner sought protection of the Court to enforce his rights in Article 19(1)(f) and 31 against the Central Bank of India Ltd.
- “The language and structure of Article 19 and its setting in Part III of the Constitution clear show that the article was intended to protect those freedoms against the State action”
Ujjam Bai v. State of U.P (1963)
- An order made by a quasi-judicial body within the jurisdiction of an Act is intra vires and is not liable to be questioned on the ground that it misconstrued provisions or terms, comes within the purview of Article 12
- Every wrong decision does not give rise to breach of fundamental rights
- That an “inclusive” definition is generally not exhaustive is a statement of the obvious and as far as Article 12 is concerned.
- However, if the body is acting under a law that violates Fundamental rights or if they’re acting outside their jurisdictions or if they are not following rules prescribed under a statute , then they are not a State under Article 12 and the decision can be challenged under Article 32.
Evolution of meaning of ‘other authorities’
Rajasthan State Electricity Board v. Mohan Lal (1967)
- Junior officer to the petitioner were promoted so he claimed right to equality against electricity board
- Art. 12 will include all constitutional or statutory authorities on whom powers are conferred by law. It is not at all material that some of the powers conferred may be for the purpose of carrying on commercial activities.
- J. Shah – Separate Opinion
o considering whether a statutory or constitutional body is an authority within the meaning of Art. 12, it would be necessary to bear in mind not only whether against the authority, fundamental rights in terms absolute are intended to be enforced, but also whether it was intended by the Constitution-makers that the authority was invested with the sovereign power to impose restrictions on very important and basic fundamental freedoms
o authorities constitutional or statutory invested with power by law but not sharing the sovereign power do not fall within the expression “State” as defined in Art. 12.
Sukhdev Singh v. Bhagat Ram (1975)
- the question is whether these statutory corporations are authorities within the meaning of Article 12. The statutes for consideration are LIC Act, ONGC Act and Industrial Finance Corporation Act
- All these provisions indicate at each stage that the creation, composition of membership, the functions and powers, the financial powers, the audit of accounts, the returns, the capital, the borrowing powers, the dissolution of the Commission and acquisition of and for the purpose of the company and the powers of entry are all authority and agency of the Central Government.
- The Oil and Natural Gas Commission is owned by the Government. It is a statutory body and not a company. The Commission has the exclusive privilege of extracting petroleum. The management is by the Government. It can be dissolved only by the Government.
- Matthew J.
o The fact that these corporations have independent personalities in the eye of law does not mean that they are not subject to the control of government or that they are not instrumentalities of the government. These corporations are instrumentalities or agencies of the state for carrying on businesses which otherwise would have been run by the state departmentally
o The crux of the matter is that public corporation is a new type of institution which has sprung from the new social and economic functions of government and that it therefore does not neatly fit into old legal categories. Instead of forcing it into them, the later should be adapted to the needs of changing times and conditions.
o The ultimate question which is relevant for our purpose is whether the Corporation is an agency of instrumentality of the Government for carrying on a business for the benefit of the public.
Sabhajit Tewary v. Union of India (1975)
- Given on same day as of Sukhdev by same bench of Sukhdev
- Council for Scientific and Industrial Research which was only registered under the Societies Registration Act would not come under the term “other authorities” in Article 12.
- Distinction with Sukhdev
o Sukhdev – The Court held that bodies which were creatures of the statues having important State functions and where State had pervasive control of activities of those bodies would be State for the purpose of Article 12.
o Sabhajit – The Court held a body which was registered under a statute and not performing important State functions and not functioning under the pervasive control of the Government would not be a State for the purpose of Article 12.
R. D. Shetty v. Int’l Airport Authority Of India (1979)
- Tender given to party which did not meet the eligibility criteria, so giving up of tender by airport authority was challenged.
- Talks about several characteristics of state which are reiterated in Ajay Hasia case pointwise
Ajay Hasia v. Khalid Mujib (1981)
- Petitioner got good marks in entrance examination but was rejected in interview where hardly any questions were posed to him.
- Contended that the college is run by society which is not a corporation created by a statute but is a society registered under the Jammu & Kashmir Societies Registration Act, 1898 and it is therefore not an ‘authority’ within the meaning of Article 12.
- 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
- There are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of Government.
o One thing is clear that if the entire share capital of the corporation is held by Government it would go a long way towards indicating that the corporation is an instrumentality or agency of Government.
o 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 the corporation being impregnated with governmental character.
o It may also be a relevant factor…whether the corporation enjoys monopoly status which is the State conferred or State protected.
o Existence of deep and pervasive State control may afford an indication that the Corporation is a State agency or instrumentality.
o If the functions of the corporation of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government.
o Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference of the corporation being an instrumentality or agency of Government
Som Prakash Rekhi v. Union of India (1981)
- Pension arbitrarily reduced of the employee of Burmah Shell which was later acquired by the Central government
- The true test is functional. Not how the legal person is born but why it is created. Nay more, Apart from discharging functions or doing business as the proxy of the State, wearing the corporate mask there must be an element of ability to affect legal relations by virtue of power vested in it by law
- There is no good reason why, if government is bound to observe the equality clauses of the Constitution in the matter of employment and in its dealings with the employees, the corporations set up or owned by the government should not be equally bound and why, instead, such corporations could become citadels of patronage and arbitrary action.
- A public authority is a body which has public or statutory duties to perform and which performs those duties and carries out its transactions for the benefit of the public and not for private profit
- merely because a corporation has legal personality of its own, it does not follow that the corporation cannot be an agent or instrumentality of the State, if it is subject to control of government in all important matters of policy
Chander Mohan Khanna v. NCERT (1992)
- Whether NCERT is state for purposes of Article 12?
- This Court came to the conclusion that since NCERT was largely an autonomous body and the activities of NCERT were not wholly related to governmental functions and that the governmental control was confined only to the proper utilisation of the grant and since its funding was not entirely from government resources, the case did not satisfy the requirements of the State under Article 12 of the Constitution.
- For Sabhajit – decision has been distinguished and watered down in the subsequent decisions.
Pradeep Kumar Biswas v. Indian Institute of Chemical Biology and Ors. (2002)
- This case deals with writ petition against Indian Institute of Chemical Biology which is a unit of CSIR (Sabhajit held that Council of Scientific and Industrial Research is not state for purpose of Article 12, this court also held the same)
- Sabhajit is specific to facts of that case, and Hasia is the ultimate authority
- For Hasia – Such control must be particular to the body in question and must be pervasive. If this is found then the body is a State within Article 12. On the other hand, when the control is merely regulatory whether under statute or otherwise, it would not serve to make the body a State.
- There exists a distinction between a ‘State’ based on its being a statutory body and one based on the principles propounded in the case of Ajay Hasia
o Principles laid down in Ajay Hasia are not a rigid set of principles so that if a body falls within any one of them it must ex hypothesi, be considered to be a State within the meaning of Article 12.
o The Question in each case will have to be considered on the bases of facts available as to whether in the light of the cumulative facts as established, the body is financially, functionally, administratively dominated, by or under the control of the Government.
o Such control must be particular to the body in question and must be pervasive.
o Mere regulatory control whether under statute or otherwise would not serve to make a body a State.
Zee Telefilms Ltd v. Union of India (2005)
- Whether BCCI is state for purposes of Article 12?
- He submitted that this absolute authority of the Board is because of the recognition granted by the Government of India, hence in effect even though it is as an autonomous body the same comes under “other authorities” for the purpose of Article 12.
- It is his further contention that many of the vital activities of the Board like sending a team outside India or inviting foreign teams to India is subject to the prior approval of the Government of India. Hence, the first respondent Union of India has pervasive control over the activities of the Board. Board has also taken financial assistance from state at several instances.
- Held BCCI is not state, as it is not created by a statute, no governmental share in it, autonomous lacking deep and pervasive state control, financial assistance is not taken, monopoly status is not due to government and government is free to make its own board.
- Merely because a non-governmental body exercise some public duty it is not sufficient to hold it as a state for purposes of Article 12.
- Dr. Ambedkar in CAD (Article 12 was introduced in the Draft Constitution as Article 7.)
o it is quite clear that if the fundamental rights are to be clear, then they must be binding not only upon the Central Government they must not only be binding upon the Provincial Government, they must not only be binding upon the Governments established in the Indian States, they must also be binding upon District Local Boards, Municipalities, even village panchayats and taluk boards, in fact every authority which has been created by law and which has got certain power to make laws, to make rules, or make bye-laws.
- S.B. Sinha Dissenting –
o K.R. Anitha v. Regional Director, ESI Corporation (2003) – When the law provides for a general control over a business in terms of a statute and not in respect of the body in question, it would not be a ‘State’.
o Jiby P. Chacko v. Mediciti School of Nursing, Ghanpur (2002) – A school would be a State if it is granted financial aid.
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