IN THE HIGH COURT OF KERALA AT ERNAKULAM
WP(C).No. 2172 of 2011(S)
1. A.K.RAJESWARAN, JUNIOR TECHNICIAN,
... Petitioner
2. A.SOBHA KUMAR, JUNIOR TECHNICIAN
3. S.SATHEESH KUMAR, SENIOR TECHNICIAN,
Vs
1. THE SECRETARY TO THE GOVERNMENT
... Respondent
2. THE MANAGING DIRECTOR, U.E.I.LTD.,
For Petitioner :SRI.P.SIVARAJ
For Respondent : No Appearance
The Hon'ble the Chief Justice MR.J.CHELAMESWAR
The Hon'ble MR. Justice P.R.RAMACHANDRA MENON
Dated :21/01/2011
O R D E R
J.Chelameswar, C.J. & P.R.Ramachandra Menon, J.
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W.P.(C) No.2172 of 2011
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Dated this the 21st day of January, 2011
JUDGMENT
J.Chelameswar, C.J.
The writ petition is filed purportedly in public interest with the
prayers as follows:
“i) a writ of mandamus or any other appropriate writ, order or
direction commanding and compelling the respondents not to
proceed with Exhibit P2 publication any further till the financial
condition of the parent company, viz. The United Electrical
Industries Ltd., Kollam is improved;
ii) a writ of mandamus directing the state government to
take necessary action on Exhibit P1 within a stipulated period of
time before proceeding further with Exhibit P2;
iii) such other appropriate writ, order or direction declaring
that the policy decision of the government to establish a sub-unit of
U.E.I.td., at Kuzhalmannam in Palakkad as illegal;
iv) such other appropriate writ, order or direction which this
Hon’ble Court deems fit for the ends of justice; and
v) award costs to the petitioners.”
2. The three petitioners claim to be the employees of the
company known as United Electrical Industries Limited. The said company
is a Government company within the meaning of Section 617 of the
WP(C) No.2172 of 2011
– 2 –
Companies Act. It appears that the said company is engaged in the
business of manufacture and sale of electrical meters. One of the major
consumers of the products of the company, it appears, is the Kerala
State Electricity Board.
3. The complaint in the instant writ petition is that though
the said company is running in losses the respondents have taken a
decision to establish a second unit under the umbrella of the above
mentioned company at Palakkad. According to the petitioners, the
decision of the respondents is discernible from an advertisement calling
for applications from eligible candidates for filling up of the various posts
specified in the advertisement filed as Exhibit P2 with the writ petition.
In the said advertisement, applications from eligible candidates are
invited to fill up 87 posts. The case of the petitioners is that the decision
of the respondents to establish a second unit and employ 87 people in
the background of the fact that the company is already running in losses
is illegal and hence the writ petition.
4. For the purpose of the present case we proceed on the
basis that the respondents do in fact propose to start a second unit
under the umbrella of the above mentioned company though such a fact
is not clearly established. Such a decision in our view, would be a
commercial decision taken by the State. The State Government is
required to take various factors into consideration before taking such a
decision. The mere fact that one of the units of the company is running
WP(C) No.2172 of 2011
– 3 –
in losses by itself is not a determinative factor to decide whether the
State’s decision to start another unit is illegal. It would be essentially a
commercial decision if it were to be taken by a company and not
associated with the State. On the other hand, when such a decision is
taken by a Government owned company, further considerations also
arise as the Government cannot only look at the economic viability of a
commercial venture undertaken by it. The Supreme Court has
repeatedly held that State is not purely a commercial venture and it has
further statutory and constitutional obligations to be discharged.
Therefore, the decision would be in the realm of the policy of the State.
Whatever be the economic wisdom of the State in taking such a policy
decision, the Court should keep away from scrutinizing such decision
unless compelled by clear infractions of either the Constitution or laws.
No such infraction is brought to our notice in the instant case. We do
not find any merit in the writ petition.
The writ petition is therefore dismissed at the admission
stage.
J.Chelameswar,
Chief Justice
P.R.Ramachandra Menon,
Judge
vns