{"id":102241,"date":"2002-04-16T00:00:00","date_gmt":"2002-04-15T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002"},"modified":"2017-04-30T11:36:17","modified_gmt":"2017-04-30T06:06:17","slug":"pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002","title":{"rendered":"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical … on 16 April, 2002"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical … on 16 April, 2002<\/div>\n
Author: R Lahoti<\/div>\n
Bench: R.C. Lahoti, Doraiswamy Raju<\/div>\n
           CASE NO.:\nAppeal (civil) 992  of  2002\n\n\n\nPETITIONER:\nPRADEEP KUMAR BISWAS & ORS.\n\n\tVs.\n\nRESPONDENT:\nINDIAN INSTITUTE OF CHEMICAL BIOLOGY & ORS.\n\nDATE OF JUDGMENT:\t16\/04\/2002\n\nBENCH:\nR.C. Lahoti & Doraiswamy Raju\n\n\n\n\nJUDGMENT:\n<\/pre>\n
R.C. Lahoti, J.\n<\/p>\n
    (for self and on behalf of Doraiswamy Raju, J.)<\/p>\n
We have had the advantage of reading the judgment proposed
\nby our learned sister Ruma Pal, J..   With greatest respect to her, we
\nfind ourselves not persuaded to subscribe to her view overruling
\nSabhajit Tewary’s case and holding Council for Scientific and
\nIndustrial Research (CSIR) ‘the State’ within the meaning of Article
\n12 of the Constitution.\t The development of law has travelled through
\napparently a zig-zag track of judicial pronouncements, rhythmically
\ntraced by Ruma Pal, J. in her judgment.\t Of necessity, we shall have to
\nretread the track, for, we find that though the fundamentals and basic
\nprinciples for determining whether a particular body is ‘the State’ or
\nnot may substantially remain the same but we differ in distributing the
\nemphasis within the principles in their applicability to the facts found.
\nWe also feel that a distinction has to be borne in mind between an
\ninstrumentality or agency of ‘the State’ and an authority includible in
\n‘other authorities’.  The distinction cannot be obliterated.\n<\/p>\n
Article 12 of the Constitution reads as under:\n<\/p>\n
“12.  In this part, unless the context
\notherwise requires, “the State” includes the
\nGovernment and Parliament of India and the
\nGovernment and the Legislature of each of
\nthe States and all local or other authorities
\nwithin the territory of India or under the
\ncontrol of the Government of India.”\n<\/p>\n
\tThis definition is for the purpose of attracting applicability of
\nthe provisions contained in Part III of the Constitution dealing with
\nfundamental rights.  It is well-settled that the definition of ‘the State’
\nin Article 12 has nothing to do with Articles 309, 310 and 311 of the
\nConstitution which find place in Part XIV.  Merely because an entity
\nis held to be the State within the meaning of Article 12, its employees
\ndo not ipso facto become entitled to protection of Part XIV of the
\nConstitution.\n<\/p>\n
Dr. B.R. Ambedkar explaining the scope of Article 12 and
\nreason why this Article was placed in the Chapter on Fundamental
\nRights so spoke in the Constituent Assembly :\n<\/p>\n
“The object of the fundamental rights is
\ntwo-fold.   First, that every citizen must be in a
\nposition to claim those rights.\t Secondly, they must
\nbe binding upon every authority\t I shall presently
\nexplain what the word “authority” means\t upon
\nevery authority which has got either the power to
\nmake laws or the power to have discretion vested
\nin it.\tTherefore, it is quite clear that if the
\nFundamental Rights are to be clear, then they must
\nbe binding not only upon the Central Government,
\nthey must not only be binding the Provincial
\nGovernment, they must not only be binding upon
\nthe Governments established in the Indian States,
\nthey must also be binding upon District Local
\nBoards, Municipalities, even village panchayats
\nand taluk boards, in fact, every  authority which
\nhas been created by law and which has got certain
\npower to make laws, to make rules, or make bye-\n<\/p>\n
laws.\n<\/p>\n
If that proposition is accepted\t and I do not
\nsee anyone who cares for Fundamental Rights can
\nobject to such a universal obligation being
\nimposed upon every authority created by law
\nthen, what are we to do to make our intention
\nclear?\tThere are two ways of doing it.\t One way is
\nto use a composite phrase such as “the State”, as
\nwe have done in article 7; or, to keep on repeating
\nevery time, “the Central Government, the
\nProvincial Government, the State Government, the
\nMunicipality, the Local Board, the Port Trust, or
\nany other authority”.  It seems to me not only most
\ncumbersome but stupid to keep on repeating this
\nphraseology every time we have to make a
\nreference to some authority.  The wisest course is
\nto have this comprehensive phrase and to
\neconomise in words”.\n<\/p>\n
\t(1948 (Vol.VII) CAD 610)
\n\t[emphasis supplied]<\/p>\n
\tThus the framers of the Constitution used the word “the State”
\nin a wider sense than what is understood in the ordinary or narrower
\nsense.\tSo far\tas ‘other authorities’ are concerned they were included
\nsubject to their satisfying the test of being ‘within the territory of
\nIndia’ or being ‘under the control of the Government of India’. It is
\nsettled that the expression ‘under the control of the Government of
\nIndia’ in Article 12 does not qualify the word ‘territory’; it qualifies
\n‘other authorities’.\n<\/p>\n
\tThe terms  ‘instrumentality’ or ‘agency’ of the State  are not
\nto be found mentioned in Article 12.  It is by the process of judicial
\ninterpretation\tnay, expansion – keeping in view the sweep of Article
\n12 that they have been included as falling within the net of Article 12
\nsubject to satisfying certain tests.  While defining, the use of
\n‘includes’ suggest  what follows is not exhaustive.  The definition is
\nexpansive of the meaning of the term defined.  However, we feel that
\nexpanding dimension of ‘the State’ doctrine through judicial wisdom
\nought to be accompanied by wise limitations else the expansion may
\ngo much beyond what even the framers of Article 12 may have
\nthought of.\n<\/p>\n
Instrumentality, Agency, Authority  meaning of<\/p>\n
It will be useful to understand what the terms – instrumentality,
\nagency and authorities mean before embarking upon a review of
\njudicial decisions dealing with the principal issue which arises for our
\nconsideration.\n<\/p>\n
\tBlack’s Law Dictionary (Seventh Edition) defines
\n‘instrumentality’ to mean “a means or agency through which a
\nfunction of another entity is accomplished, such as a branch of a
\ngoverning body.”  ‘Agency’ is defined as “a fiduciary relationship
\ncreated by express or implied contract or by law, in which one party
\n(the agent) may act on behalf of another party (the principal) and bind
\nthat  other party by words or actions.”\t  Thus instrumentality and
\nagency are the two terms which to some extent overlap in their
\nmeaning; ‘instrumentality’ includes ‘means’ also, which ‘agency’
\ndoes not, in its meaning.   ‘Quasi- governmental agency’ is “a
\ngovernment  sponsored enterprise or Corporation (sometimes called
\na government-controlled corporation)”. Authority, as Webster
\nComprehensive Dictionary (International Edition) defines, is “the
\nperson or persons in whom government or command is vested; often
\nin the plural”.\t The applicable meaning of the word “authority” given
\nin Webster’s Third New International Dictionary, is ‘a public
\nadministrative agency or corporation having quasi-governmental
\npowers and authorized to administer a revenue-producing public
\nenterprise’.  This was quoted with approval by Constitution Bench in
\nRSEB’s case (infra) wherein the Bench held  “This dictionary
\nmeaning of the word “authority” is clearly wide enough to include all
\nbodies created by a statute on which powers are conferred to carry out
\ngovernmental or quasi-governmental functions.  The expression
\n“other authorities” is wide enough to include within it every authority
\ncreated by a statute and functioning within the territory of India, or
\nunder the control of the Government of India; and we do not see any
\nreason to narrow down this meaning in the context in which the words
\n“other authorities” are used in Art.12 of the Constitution”. (emphasis
\nadded)<\/p>\n
With the pronouncements in N. Masthan Sahib Vs. The Chief
\nCommissioner, Pondicherry and Anr.  (1962) Supp.1 SCR 981 and
\nK.S. Ramamurthy Reddiar Vs. Chief Commissioner, Pondicherry
\nand Anr.  (1964) 1 SCR 656 it is settled that Article 12 of the
\nConstitution has to be so read :\n<\/p>\n
\t“12.\tIn this part, unless the context otherwise requires, the
\n‘State’ includes<\/p>\n
(i)\tthe Government and Parliament of India,<\/p>\n
(ii)\tthe Government and the Legislature of each State,<\/p>\n
(iii)\t(a) all local or other authorities within the territory of India,\n<\/p>\n
\t(b) all local or other authorities under the control of the
\n\t    Government of India.”\n<\/p>\n
The definition of the State as contained in Article 12 is inclusive and
\nnot conclusive.\t The net of Article 12 has been expanded by
\n‘progressive’ judicial thinking, so as to include within its ken several
\ninstrumentalities and agencies performing State function or entrusted
\nwith State action.  To answer the principal question in the context in
\nwhich it has arisen, incidental but inseparable issues do arise: Wide
\nexpansion but how far wide? Should such wide expansion be not
\nsubject to certain wise limitations?  True, the width of expansion and
\nthe wisdom of limitations both have to be spelled out from Article 12
\nitself and the fundamentals of constitutional jurisprudence.\n<\/p>\n
\tWe now deal with a series of decisions wherein tests were
\npropounded, followed (also expanded) and applied to different entities
\nso as to find out whether they satisfied the test of being ‘the State’.\n<\/p>\n
A review of judicial opinion<\/p>\n
\tThough judge-made law is legend on the issue, we need not
\npeep too much deep in the past unless it becomes necessary to have a
\nglimpse of a few illuminating points thereat.  It would serve our
\npurpose to keep ourselves confined, to begin with, to discerning the
\nprinciples laid down in Rajasthan State Electricity Board, Jaipur
\nVs. Mohal Lal and Ors.\t(1967) 3 SCR 377, Sukhdev Singh and
\nOrs. Vs. Bhagatram Sardar Singh Raghuvanshi and Anr.  (1975) 1
\nSCC 421, Ramana Dayaram Shetty Vs. The International Airport
\nAuthority of India and Ors. (1979) 3 SCC 489, Ajay  Hasia etc. Vs.
\nKhalid Mujib Sehravardi and Ors. etc.  (1981) 1 SCC 722 and Som
\nPrakash Rekhi Vs. Union of India and Anr.  (1981) 1 SCC 449
\nwhich have come to be known as landmarks on the State
\nconceptualisation .  Out of these five decisions, R.D. Shetty and Som
\nPrakash are three-Judges Bench decisions; the other 3 are each by
\nConstitution Bench of five-Judges.\n<\/p>\n
\tThe Constitution Bench decision in Rajasthan State
\nElectricity Board (RSEB)’s case was delivered by a majority of 4:1.
\nV. Bhargava, J. spoke for himself and K. Subba Rao, C.J. and M.
\nShelat and G.K. Mitter, JJ.   J.C. Shah, J. delivered his dissenting
\nopinion.  We will refer to majority opinion only.  The Court quoted
\nthe interpretation placed by Ayyangar, J. from the pronouncement of
\nseven-Judges Bench of this Court in Smt. Ujjam Bai Vs. State of
\nUttar Pradesh and Anr.\t(1963) 1 SCR 778 that the words ‘other
\nauthorities’ employed in Article 12 are of wide amplitude and capable
\nof comprehending every authority created under a statute and though
\nthere is no characterisation of the nature of the “authority” in the
\nresiduary clause of Article 12 it must include every authority set up
\nunder a statute for the purpose of administering laws enacted by the
\nParliament or by the State including those vested with the duties to
\nmake decisions in order to implement those laws.  The Court refused
\nto apply the doctrine of  ejusdem generis for interpretation of the
\n‘other authorities’ in Article 12.  “Other authorities” in Article 12
\ninclude, held the Court, “all constitutional or statutory authorities on
\nwhom powers are conferred by law” without regard to the fact that
\nsome of the powers conferred may be for the purpose of carrying on
\ncommercial activities or promoting the educational and economic
\ninterests of the people.  Regard must be had (i) not only to the sweep
\nof fundamental rights over the power of the authority, (ii) but also to
\nthe restrictions which may be imposed upon the exercise of certain
\nfundamental rights by the authority.  This dual phase of fundamental
\nrights would determine “authority”.  Applying the test formulated by
\nit to Rajasthan State Electricity Board, the Court found that the Board
\nthough it was required to carry on some activities of the nature of
\ntrade or commerce under the Electricity Supply Act, yet the statutory
\npowers conferred by the Electricity Supply Act on the Board included
\npower to give directions, the disobedience of which is punishable as a
\ncriminal office and therefore the Board was an authority for the
\npurpose of Part III of the Constitution.\n<\/p>\n
\tPraga Tools Corporation Vs. C.V. Imanual and Ors.  (1969)
\n1 SCC 585 may not be of much relevance.\t The question posed before
\nthe Court was not one referable to Article 12 of the Constitution.  The
\nquestion was whether a prayer seeking issuance of a mandamus or an
\norder in the nature of mandamus could lie against a company
\nincorporated under the Companies Act wherein the Central and the
\nState Governments held respectively 56 and 32 per cent shares.\tThe
\ntwo-Judge Bench of this Court held that the company was a separate
\nlegal entity and could not be said to be either a government
\nCorporation or an industry run by or under the authority of the Union
\nGovernment.  A mandamus lies to secure the performance of a public
\nor statutory duty in the performance of which the petitioner has a
\nsufficient legal interest.  A mandamus can issue to an official or a
\nsociety to compel him to carry out the terms of the Statute under or by
\nwhich the society is constituted or governed and also to companies or
\nCorporations to carry out duties placed on them by the Statute
\nauthorizing their undertaking.\tA mandamus would also lie against a
\ncompany constituted by a Statute for the purpose of fulfilling public
\nresponsibilities.  The Court held that the company being a non-
\nstatutory body with neither a statutory nor a public duty imposed on it
\nby a Statute, a writ petition for mandamus did not lie against it.  The
\nlimited value of this decision, relevant for our purpose, is that because
\na writ of mandamus can issue against a body solely by this test it does
\nnot become ‘State’ within the meaning of Article 12.\n<\/p>\n
\tIn Sukhdev Singh & Ors. Vs. Bhagatram Sardar Singh
\nRaghuvanshi and another (supra), question arose whether Oil and
\nNatural Gas Commission, the Industrial Finance Corporation and Life
\nInsurance Corporation are ‘authorities’ within the meaning of Article\n<\/p>\n
12.  The case was decided by a majority of 4:1.\t  A.N. Ray, CJ
\nspeaking for himself and on behalf of Y.V. Chandrachud and A.C.
\nGupta, JJ. held that all the three were statutory Corporations, i.e.,
\ngiven birth by Statutes.  The circumstance that these statutory bodies
\nwere required to carry on some activities of the nature of trade or
\ncommerce did not make any difference.  The Life Insurance
\nCorporation is (i) an agency of the Government (ii) carrying on the
\nexclusive business of Life Insurance (i.e. in monopoly), and (iii) each
\nand every provision of the Statute creating it showed in no uncertain
\nterms that the Corporation is the voice and the hands of the Central
\nGovernment.  The Industrial Financial Corporation is in effect
\nmanaged and controlled by the Central Government, citizens cannot
\nbe its shareholder. ONGC (i) is owned by the Government, (ii) is a
\nstatutory body and not a company and (iii) has the exclusive privilege
\nof extracting petroleum. Each of the three, respectively under the three
\nActs under which they are created, enjoy power to do certain acts and
\nto issue directions obstruction in or breach whereof is punishable as
\nan offence.  These distinguish them from a mere company
\nincorporated under the Indian Companies Act.   The common features
\nof the three are (i)  rules and regulations framed by them have the
\nforce of law, (ii) the employees have a statutory status, and (iii) they
\nare entitled to declaration of being in employment when the dismissal
\nor removal is in contravention of statutory provisions.\t The learned
\nChief Justice added, by way of abundant caution, that these provisions
\ndid not however make the employees as servants of the Union or the
\nState though the three statutory bodies are authorities within the
\nmeaning of Article 12 of the Constitution.\n<\/p>\n
\tMathew, J. recorded his separate concurring opinion.  As to
\nONGC he hastened to arrive at a conclusion that the Commission was
\ninvested with sovereign power of the State and could issue binding
\ndirections to owners of land and premises, not to prevent employees
\nof the Commission from entering upon their property if the
\nCommission so directs.\tDisobedience of its directions is punishable
\nunder the relevant provisions of the Indian Penal Code as the
\nemployees are deemed to be public servants.  Hence the Commission
\nis an authority.  As to the other two Corporations, viz., LIC and IFC,
\nMathew, J. entered into a short question and began by observing that
\nin recent years the concept of State has undergone drastic change.
\n“Today State cannot be conceived of simply as a coercive machinery
\nwielding the thunderbolt of authority”.\t Having reviewed some
\ndecisions of United States and English decisions and some other
\nauthorities, he laid down certain principles with which we will deal
\nwith a little later and at appropriate place.  He observed that
\ninstitutions engaged in matters of high public interest or performing
\npublic functions are, by virtue of the nature of the function performed
\nby them, governmental agencies.\t He noticed the difficulty in
\nseparating vital government functions from non-governmental
\nfunctions in view of the contrast between governmental activities
\nwhich are private and private activities which are governmental.  For
\nholding Life Insurance Corporation  “the State” he relied on the
\nfollowing features : (i) the Central Government has contributed the
\noriginal capital of the Corporation, (ii) part of the profit of the
\nCorporation goes to Central Government, (iii) the Central
\nGovernment exercises control over the policy of the Corporation, (iv)
\nthe Corporation carries on a business having great public importance,
\nand (v) it enjoys a monopoly in the business.  As to Industrial
\nFinancial Corporation he relied on the circumstances catalogued in the
\njudgment of A.N. Ray, J.  The common feature of the two
\nCorporations was that they were instrumentalities or agencies of the
\nState for carrying on business which otherwise would have been run
\nby the State departmentally and if the State had chosen to carry on
\nthese businesses through the medium of government departments,
\nthere would have been no question that actions of these departments
\nwould be “state actions”.  At the end Mathew, J. made it clear that he
\nwas  expressing no opinion on the question whether private
\nCorporations or other like organizations though they exercise power
\nover their employees which might violate their fundamental rights
\nwould be the State within the meaning of Article 12.  What is ‘state
\naction’ and how far the concept of ‘state action’ can be expanded,
\nposing the question, Mathew J. answered\t “..it is against State
\naction that fundamental rights are guaranteed.\tWrongful individual
\nacts unsupported by State authority in the shape of laws, customs, or
\njudicial or executive proceeding are not prohibited.  Articles 17, 23
\nand 24 postulate that fundamental rights can be violated by private
\nindividuals and that the remedy under Article 32 may be available
\nagainst them.  But by and large, unless an act is sanctioned in some
\nway by the State, the action would not be State action.\t In other
\nwords, until some law is passed or some action is taken through
\nofficers or agents of the State, there is no action by the State.”  So also
\ncommenting on the relevance of ‘state help’ and ‘state control’ as
\ndeterminative tests, Mathew, J. said  “It may be stated generally that
\nState financial aid alone does not render the institution receiving such
\naid a state agency.  Financial aid plus some additional factor might
\nlead to a different conclusion.\t A mere finding of state control also is
\nnot determinative of the question, since a state has considerable
\nmeasure of control under its police power over all types of business
\noperations.”\n<\/p>\n
Alagiriswami, J. recorded a dissenting opinion which however
\nwe propose to skip over.   It is pertinent to note that the dispute in
\nSukhdev Singh Vs. Bhagat Ram was a service dispute and the
\nemployees were held entitled to a declaration of being in employment
\nwhen their dismissal or removal was in contravention of statutory
\nprovisions; the rules and regulations framed by corporations or
\ncommission were found having the force of law, being delegated
\nlegislation and these statutory bodies were held to be ‘authorities’
\nwithin the meaning of Article 12.\n<\/p>\n
\tIn Ramanna Dayaram Shetty Vs. The International Airport
\nAuthority of India & Ors. (supra), the dispute related to trends
\nwithin the domain of administrative law.  A question arose whether
\nInternational Airport Authority of India (IA, for short) was within the
\nscope of ‘other authorities’ in Article 12 so as to be amenable to
\nArticle 14 of the Constitution.\t P.N. Bhagwati, J. who delivered the
\njudgment for the three-Judge Bench stated the ratio of Rajasthan
\nState Electricity Boards case, in these words :\n<\/p>\n
\t“The ratio of this decision may thus be
\nstated to be that a constitutional or statutory
\nauthority would be within the meaning of the
\nexpression ‘other authorities’, if it has been
\ninvested with statutory power to issue binding
\ndirections to third parties, the disobedience of
\nwhich would entail penal consequence or it has the
\nsovereign power to make rules and regulations
\nhaving the force of law”.\n<\/p>\n
He then referred to what he termed as a ‘broader test’ laid down
\nby Mathew, J. in Sukhdev Singh’s case and said that judgment by
\nMathew, J. provided ‘one more test and perhaps a more satisfactory
\none’ for determining whether a statutory corporation, body or other
\nauthority falls within the definition of ‘the State’ and the test is___”If a
\nstatutory corporation, body or other authority is an instrumentality or
\nagency of government, it would be an authority and therefore ‘the
\nState’ within the meaning of the expression in\tArticle 12.”  Having
\nminutely examined the provisions of the International Airport
\nAuthority Act, 1971 he found out the following features of IA :- (i)
\nThe Chairman and Members are all persons nominated by the Central
\nGovernment and Central Government has power to terminate the
\nappointment or remove them;  (ii) The Central Government is vested
\nwith the power to take away the management of any airport from the
\nIA; (iii) The Central Government has power to give binding directions
\nin writing on questions of policy; (iv) The capital of IA needed for
\ncarrying out its functions is  wholly provided by Central Government;\n<\/p>\n
(v) The balance of net profit made by IA, after making certain
\nnecessary provisions, does not remain with the IA and is required to
\nbe taken over to the Central Government; (vi) The financial estimates,
\nexpenditure and programme of activities can only be such as approved
\nby Central Government; (vii) The Audit Accounts and the Audit
\nReport of IA, forwarded to the Central Government, are required to be
\nlaid before both Houses of Parliament; (viii) It was a department of
\nthe Central Government along with its properties, assets, debts,
\nobligations, liabilities, contracts, cause of action and pending
\nlitigation taken over by the IA; (ix) IA was charged with carrying out
\nthe same functions which were being carrying out by the Central
\nGovernment; (x) The employees and officials of IA are public
\nservants and enjoy immunity for anything done or intended to be
\ndone, in good faith, in pursuance of the Act or any rules or regulations
\nmade by it; (xi) IA is given (delegated) power to legislate and
\ncontravention of certain specified regulations entails penal
\nconsequences.  Thus, in sum, the IA was held to be an instrumentality
\nor agency of the Central Government falling within the definition of
\nthe State both on the narrower view propounded in the judgment of
\nA.N. Ray, CJ and broader view propounded by Mathew, J. in
\nSudhdev Singh’s case.\n<\/p>\n
\tAjay Hasia etc. v. Khalid Mujib Sehravardi and Ors. etc.
\n(supra), is a Constitution Bench judgment wherein P.N. Bhagwati, J.
\nspoke for the Court.  The test which he had laid down in Ramanna’s
\ncase were summarized by him as six in number and as under:\n<\/p>\n
“1.\tOne thing is clear that if the entire share capital of the
\nCorporation is held by Government it would go a long way
\ntowards indicating that the Corporation is an instrumentality or
\nagency of Government.\n<\/p>\n
2.\tWhere the financial assistance of the State is so much as to
\nmeet almost entire expenditure of the corporation, it would
\nafford some indication of the corporation being impregnated
\nwith governmental character.\n<\/p>\n
3.\tIt may also be a relevant factor.whether the corporation
\nenjoys monopoly status which is the State conferred or State
\nprotected.\n<\/p>\n
4.\tExistence of “deep and pervasive State control may afford an
\nindication that the corporation is a State agency or
\ninstrumentality”.\n<\/p>\n
5.\tIf the functions of the Corporation of public importance and
\nclosely related to government functions, it would be a relevant
\nfactor in classifying the corporation as an instrumentality or
\nagency of Government.\n<\/p>\n
6.\t“Specifically, if a department of Government is transferred to a
\ncorporation, it would be a strong factor supportive of this
\ninference” of the corporation being an instrumentality or agency
\nof Government.”\n<\/p>\n
The footnote to the tests, as put by him, is  “if on a consideration of
\nall these relevant factors it is found that the corporation is an
\ninstrumentality or agency of government, it would, be an
\nauthority, and therefore, ‘the State’ within the meaning of Article 12.
\nBhagwati, J. placed a prologue to the above said tests emphasizing
\nthe need to use care and caution, “because while stressing the
\nnecessity of a wide meaning to be placed on the expression “other
\nauthorities”, it must be realized that it should not be stretched so far as
\nto bring in every autonomous body which has some nexus with the
\nGovernment within the sweep of the expression.\tA wide enlargement
\nof the meaning must be tempered by a wise limitation.”\n<\/p>\n
\tIn Ajay Hasia, the ‘authority’ under consideration was a
\nsociety registered  under the Jammu & Kashmir Registration of
\nSocieties Act, 1898, administering and managing the Regional
\nEngineering College, Srinagar.\tThe College was sponsored by the
\nGovernment of India.  The prominent features of the society indicated
\ncomplete financing and financial control of the Government, complete
\nadministrative control over conducting of the affairs of the society and
\nadministration and assets of the College being taken over by the State
\nGovernment with the prior approval of the Central Government.
\nThese are some of the material features.  Some of the observations
\nmade by the Court during the course of its judgment are pertinent and
\nwe proceed to notice them quickly.  The society could not be equated
\nwith the Government of India or the Government of any State nor
\ncould it be said to be ‘local authority’, and therefore, should have
\ncome within the expression of ‘other authorities’ to be ‘the State’.
\nThe Government may act through the instrumentality or agency of
\nnatural persons or it may employ the instrumentality or agency of
\njuridical persons to carry out its functions.  With the enlargement of
\ngovernmental activities, specially those in the field of trade and
\ncommerce and welfare, corporation is most resourceful legal
\ncontrivance resorted to frequently by the Government.  Though a
\ndistinct juristic entity came into existence because of its certain
\nadvantages in the field of functioning over a department of the
\nGovernment but behind the formal ownership  cast in the corporate
\nmould, the reality is very much the deeply pervasive presence of the
\nGovernment.  It is really the Government which acts through the
\ninstrumentality or agency of the Corporation and the juristic veil of
\ncorporate personality is worn for the purpose of convenience of
\nmanagement and administration which cannot be allowed to obliterate
\nthe true nature of the reality behind which is the Government.
\nDealing at length with the corporate contrivance, the Court summed
\nup its conclusion by saying that if a Corporation is found to be a mere
\nagency or surrogate of the Government, 3 tests being satisfied viz., (i)
\nin fact, owned by the Government, (ii) in truth, control by the
\nGovernment, and (iii) in effect, an incarnation of the Government,
\nthen the Court would hold the Corporation to be Government, and
\ntherefore, subject to constitutional limitations including for
\nenforcement of fundamental rights.  The Court went on to say that
\nwhere a Corporation is an instrumentality or agency of the
\nGovernment, it must be held to be an ‘authority’ for Article 12.\n<\/p>\n
\tHere itself we have few comments to offer. Firstly, the
\ndistinction between ‘instrumentality and agency’ on the one hand, and
\n‘authority (for the purpose of ‘other authorities’)’ on the other, was
\ntotally obliterated.   In our opinion, it is one thing to say that if an
\nentity veiled or disguised as a Corporation or a society or in\tany other
\nform is found to be an instrumentality or agency of the State then in
\nthat case it will be the State itself in narrower sense acting through its
\ninstrumentality or agency and therefore, included in ‘the State’ in the
\nwider sense for the purpose of Article 12.  Having found an entity
\nwhether juristic or natural to be an instrumentality or agency of the
\nState, it is not necessary to call it an ‘authority’.  It would make a
\nsubstantial difference to find whether an entity is an instrumentality or
\nagency or an authority.\t Secondly, Ajay Hasia  was the case of a
\nregistered society; it was not an appropriate occasion for dealing with
\ncorporations or entities other than society.  On the inferences drawn
\nby reading of the Memorandum of Association of the society and
\nrules framed thereunder, and subjecting such inferences to the tests
\nlaid down in the decision itself, it was found that the society was an
\ninstrumentality or agency of the State and on tearing the veil of
\nsociety what was to be seen was the State itself though in disguise.  It
\nwas not thereafter necessary to hold the society an ‘authority’ and
\nproceed to record “that the society is an instrumentality or the agency
\nof the State and the Central Government and it is an ‘authority’ within
\nthe meaning of Article 12”, entirely obliterating, the dividing line
\nbetween ‘instrumentality or agency of the State’ and ‘other
\nauthorities’.  This has been a source of confusion  and misdirection in
\nthought process as we propose to explain a little later.  Thirdly, though
\nsix tests are laid down but there is no clear indication in the judgment
\nwhether in order to hold a legal entity the State, all the tests must be
\nanswered positively and it is the cumulative effect of such positive
\nanswers which will solve the riddle or positive answer to one or two
\nor more tests would be enough to find out a solution.  It appears what
\nthe court wished was reaching a final decision on an overall view of
\nthe result of the tests.  Compare this with what was said by Bhagwati,
\nJ. in Ramanna’s case.  We have already noticed that in Ajay Hasia,
\nBhagwati, J. has in his own words summarized the test laid down by
\nhim in Ramanna’s case.\tIn Ramanna’s case he had said that the
\nquestion whether a corporation is governmental instrumentality or
\nagency would depend on a variety of factors which defy exhaustive
\nenumeration and moreover even amongst these factors described in
\nRamanna’s case “the Court will have to consider the cumulative
\neffect of these various factors and arrive at its decision.”  “It is the
\naggregate or cumulative effect of all the relevant factors that is
\ncontrolling”.\n<\/p>\n
\tCriticism of too broad a view taken of the scope of the State
\nunder Article 12 in Ramanna’s case invited some criticism which
\nwas noticed in Som Prakash Rekhi’s case (infra).   It was pointed out
\nthat the observations in Ramanna’s case spill over beyond the
\nrequirements of the case and must be dismissed as obiter; that IA is a
\nCorporation created by a statute and there was no occasion to go
\nbeyond the narrow needs of the situation and expand the theme of the
\nState in Article 12 vis–vis government companies, registered
\nsociety, and what not; and that there was contradiction between
\nSukhdev Singh’s case and Ramanna’s case.\n<\/p>\n
On 13.11.1980, the Constitutional Bench presided over by Y.V.
\nChandrachud, C.J. and consisting of P.N. Bhagwati, V.R. Krishna
\nIyer, S. Murtaza Fazal Ali and A.D. Koshal, JJ. delivered the
\njudgment in Ajay Hasia’s case, speaking through P.N. Bhagwati, J..
\nIt is interesting to note that on the same day another three-Judges
\nBench consisting V.R. Krishna Iyer, O. Chinnappa Reddy and R.S.
\nPathak, JJ. delivered judgment in Som Prakash Rekhi v. Union of
\nIndia and<\/a> another (supra).  V.R. Krishna Iyer, J. speaking for
\nhimself and O. Chinnappa Reddy, J. delivered the majority opinion.
\nR.S. Pathak, J. delivered a separate opinion.\n<\/p>\n
\tThe Court in Som Parkash Rekhi v. Union of India and<\/a>
\nanother (supra), was posed with the question __ whether Bharat
\nPetroleum Corporation Ltd., a statutory corporation, was an
\n‘authority’, and therefore ‘the State’ under Article 12.  Certain
\nobservations made by Krishna Iyer, J. are pertinent.  To begin with, he
\nsaid, “any authority under control of the Government of India comes
\nwithin the definition.” While dealing with the corporate personality, it
\nhas to be remembered that “while the formal ownership is cast in the
\ncorporate mould, the reality reaches down to State control”.  The core
\nfact is that the Central Government chooses to make over, for better
\nmanagement, its own property to its own offspring.  A Government
\nCompany is a mini-incarnation of Government itself, made up of its
\nblood and bones and given corporate shape and status for defined
\nobjectives and not beyond.  The device is too obvious for deception.
\nA Government Company though, is but the alter ego of the Central
\nGovernment and tearing of the juristic veil worn, would bring out the
\ntrue character of the entity being ‘the State’.\t Krishna Iyer, J. held it to
\nbe immaterial whether the Corporation is formed by a statute or under
\na statute, the true test is functional.\t “Not how the legal person is born
\nbut why it is created.”\t He further held that both the things are
\nessential: (i) discharging functions or doing business as the proxy of
\nthe State by wearing the corporate mask, and (ii) an element of ability
\nto affect legal relations by virtue of power vested in it by law.  These
\ntests, if answered in positive, would entail the Corporation being an
\ninstrumentality or agency of the State.\t What is an ‘authority’?
\nKrishna Iyer, J. defined ‘authority’ as one which in law belongs to the
\nprovince of power and the search here must be to see whether the Act
\nvests authority, as agent or instrumentality of the State, to affect the
\nlegal relations of oneself or others.  He quoted the definition of
\n‘authority’ from the Law Lexicon by P. Ramnath Iyer to say
\n“Authority is a body having jurisdiction in certain matters of a public
\nnature” and from Salmond’s Jurisprudence, to say that the “ability
\nconferred upon a person by the law to alter, by his own will directed
\nto that end, the rights, duties, liabilities or other legal relations, either
\nof himself or of other persons,’ must be present ab extra to make a
\nperson an ‘authority’.”\t He held BPL to be “a limb of Government and
\nagency of the State, a vicarious creature of statute”, because of these
\ncharacteristics, which he found from the provisions of the Act which
\ncreated it and other circumstances, viz., (i) it is not a mere company
\nbut much more than that, (ii) it has a statutory flavour in its operations
\nand functions, in its powers and duties and in its personality itself,\n<\/p>\n
(iii) it is functionally and administratively under the thumb of
\nGovernment; and (iv) the Company had stepped into the shoes of the
\nexecutive power of the State and had unique protection, immunity and
\npowers.\t In conclusion Krishna Iyer, J. held that the case of BPL was
\na close parallel to the Airport Authority’s case (Ramanna’s case)
\nexcepting that Airport Authority is created by a statute while BPL is
\nrecognized by and clothed with rights and duties by the statute.
\nKrishna Iyer, J. having culled out the several tests from Ramanna’s
\ncase added a clinching footnote\t the finale is reached when the
\ncumulative effect of all the relevant factors above set out is assessed
\nand once the body is found to be an instrumentality or agency of
\nGovernment, the further conclusion emerges that it is ‘the State’ and
\nis subject to the same constitutional limitations as Government and it
\nis this divagation  which explains the ratio of Ramanna’s case.\n<\/p>\n
\tThe three-Judges Bench in The Workmen, Food Corporation
\nof India Vs. Food Corporation of India,\t (1985) 2 SCC 136, held
\nFood Corporation of India to be an instrumentality of the State
\ncovered by the expression ‘other authority’ in Article 12.  It was
\nfound : (i) FCI was set up under the Food Corporation Act, 1964 (ii)
\ninitial capital was provided by Central Government and capital could
\nbe increased in such manner as the government may determine; (iii)
\nthe Board of Directors in whom the management of the Corporation is
\nto vest shall act according to instructions on question of policy given
\nby the Central Government; (iv) the annual net profit of FCI is to be
\npaid to the Central Government; (v) annual report of its working and
\naffairs is to be laid before the Houses of Parliament; (vi) statutory
\npower conferred to make rules and regulations  for giving effect to the
\nprovisions of the parent act as also to provide for service matters
\nrelating to officers and employees.\n<\/p>\n
\tThe Mysore Paper Mills Ltd. has been held by a two-Judges
\nBench in Mysore Paper Mills Ltd. Vs. The Mysore Paper Mills
\nOfficers Association and Anr.  JT 2002 (1) SC 61, to be an
\ninstrumentality and agency of the State Government, the physical
\nform of company being a mere cloak or cover for the Government.
\nWhat is significant in this decision is that the conclusion whether an
\nindependent entity satisfies the test of instrumentality or agency of the
\ngovernment is not whether it owes its origin to any particular Statute
\nor Order but really depends upon a combination of one or more of the
\nrelevant factors, depending upon the essentiality and overwhelming
\nnature of such factors in identifying the real source of governing
\npower, if need be, by piercing the corporate veil of the entity
\nconcerned.\n<\/p>\n
What is ‘Authority’ and when includible in ‘other authorities’,
\nre: Article 12<\/p>\n
\tWe have, in the earlier part of this judgment, referred to the
\ndictionary meaning of ‘authority’, often used as plural, as in Article
\n12 viz. ‘other authorities’.  Now is the time to find out the meaning to
\nbe assigned to the term as used in Article 12 of the Constitution.\n<\/p>\n
\tA reference to Article 13(2) of the Constitution is apposite.  It
\nprovides ___ “The State shall not make any law which takes away or
\nabridges the right conferred by this part and any law made in
\ncontravention of this clause shall, to the extent of the contravention,
\nbe void”.  Clause (3) of Article 13 defines ‘law’ as including any
\nOrdinance, order, bye-law, rule, regulation, notification, custom or
\nuses having in the territory of India the force of law.\t We have also
\nreferred to the speech of  Dr. B.R. Ambedkar in Constituent
\nAssembly explaining the purpose sought to be achieved by Article\n<\/p>\n
12.  In RSEB’s case, the majority adopted the test that a statutory
\nauthority “would be within the meaning of ‘other authorities’ if it has
\nbeen invested with statutory power to issue binding directions to the
\nparties, disobedience of which would entail penal consequences or it
\nhas the sovereign power to make rules and regulations having the
\nforce of law”.\t In Sukhdev Singh’s case, the principal reason which
\nprevailed with A.N. Ray, CJ for holding ONGC, LIC and IFC as
\nauthorities and hence ‘the State’ was that rules and regulations
\nframed by them have the force of law.  In Sukhdev Singh’s case,
\nMathew J. held that the test laid down in RSEB’s case was satisfied
\nso far as ONGC is concerned but the same was not satisfied in the
\ncase of LIC and IFC and, therefore, he added to the list of tests laid
\ndown in RSEB’s case, by observing that though there are no statutory
\nprovisions, so far as LIC and IFC are concerned, for issuing binding
\ndirections to third parties, the disobedience of which would entail
\npenal consequences, yet these corporations (i) set up under statutes,\n<\/p>\n
(ii) to carry on business of public importance or which is fundamental
\nto the life of the people ___ can be considered as the State within the
\nmeaning of Article 12.\tThus, it is the functional test which was
\ndevised and utilized by Mathew J. and there he said, “the question for
\nconsideration is whether a public corporation set up under a special
\nstatute to carry on a business or service which Parliament thinks
\nnecessary to be carried on in the interest of the nation is an agency or
\ninstrumentality of the State and would be subject to the limitations
\nexpressed in Article 13(2) of the Constitution.\t The State is an
\nabstract entity.  It can only act through the instrumentality or agency
\nof natural or juridicial persons.  Therefore, there is nothing strange in
\nthe notion of the State acting through a corporation and making it an
\nagency or instrumentality of the State”.  It is pertinent to note that
\nfunctional tests became necessary because of the State having chosen
\nto entrust its own functions to an instrumentality or agency in
\nabsence whereof that function would have been a State activity on
\naccount of its public importance and being fundamental to the life of
\nthe people.\n<\/p>\n
The philosophy underlying the expansion of Article 12 of the
\nConstitution so as to embrace within its ken  such entitites which
\nwould not otherwise be the State within the meaning of Article 12 of
\nthe Constitution has been pointed out by the eminent jurist H.M.
\nSeervai in Constitutional Law of India (Silver Jubilee Edition, Vol.1).
\n“The Constitution should be so interpreted that the governing power,
\nwherever located, must be subjected to fundamental constitutional
\nlimitations.  . . . . . . . . . . . .  Under Article 13(2) it is State action of a
\nparticular kind that is prohibited.  Individual invasion of individual
\nrights is not, generally speaking, covered by Article 13(2).  For,
\nalthough Articles 17, 23 and 24 show that fundamental rights can be
\nviolated by private individuals and relief against them would be
\navailable under Article 32, still, by and large, Article 13(2) is directed
\nagainst State action.  A public corporation being the creation of the
\nState, is subject to the same constitutional limitations as the State
\nitself.\t Two conditions are necessary, namely, that the Corporation
\nmust be created by the State and it must invade the constitutional
\nrights of individuals”(Para 7.54).  “The line of reasoning developed
\nby Mathew J. prevents a large-scale evasion of fundamental rights by
\ntransferring work done in Govt. Departments to statutory
\nCorporations, whilst retaining Govt. control.  Company legislation in
\nIndia permits tearing of the corporate veil in certain cases and to look
\nbehind the real legal personality.  But Mathew J. achieved the same
\nresult by a different route, namely, by drawing out the implications of
\nArticle 13(2)” (Para 7.57 ibid).\n<\/p>\n
\tThe terms instrumentality or agency of the State are not to be
\nfound mentioned in Article 12 of the Constitution.  Nevertheless they
\nfall within the ken of Article 12 of the Constitution for the simple
\nreason that if the State chooses to set up an instrumentality or agency
\nand entrusts it with the same power, function or action which would
\notherwise have been exercised or undertaken by itself, there is no
\nreason why such instrumentality or agency should not be subject to
\nsame constitutional and public law limitations as the State would
\nhave been.  In different judicial pronouncements, some of which we
\nhave reviewed, any company, corporation, society or any other entity
\nhaving a juridical existence if it has been held to be an
\ninstrumentality or agency of the State, it has been so held only on
\nhaving found to be an alter ego, a double or a proxy or a limb or an
\noff-spring or a mini-incarnation or a vicarious creature or a surrogate
\nand so on __ by whatever name called __ of the State. In short, the
\nmaterial available must justify holding of the entity wearing a mask
\nor a veil worn only legally and outwardly which on piercing fails to
\nobliterate the true character of the State in disguise.\t Then it is an
\ninstrumentality or agency of the State.\n<\/p>\n
\tIt is this basic and essential distinction between an
\n‘instrumentality or agency’ of the State and ‘other authorities’ which
\nhas to be borne in mind.  An authority must be an authority sui juris
\nto fall within the meaning of the expression ‘other authorities’ under
\nArticle 12.  A juridical entity, though an authority, may also satisfy
\nthe test of being an instrumentality or agency of the State in which
\nevent such authority may be held to be an instrumentality or agency
\nof the State but not the vice versa.\n<\/p>\n
\tWe sum up our conclusions as under:-\n<\/p>\n
(1)\tSimply by holding a legal entity to be an instrumentality or
\nagency of the State it does not necessarily become an authority
\nwithin the meaning of ‘other authorities’ in Article 12.   To be an
\nauthority, the entity should have been created by a statute or under
\na statute and functioning with liability and obligations to public.
\nFurther, the statute creating the entity should have vested that
\nentity with power to make law or issue binding directions
\namounting to law within the meaning of Article 13(2) governing
\nits relationship with other people or the affairs of other people __
\ntheir rights, duties, liabilities or other legal relations.  If created
\nunder a statute, then there must exist some other statute conferring
\non the entity such powers.  In either case, it should have been
\nentrusted with such functions as are governmental or closely
\nassociated therewith by being of public importance or being
\nfundamental to the life of the people and hence governmental.
\nSuch authority would be the State, for, one who enjoys the powers
\nor privileges of the State must also be subjected to limitations and
\nobligations of the State.  It is this strong statutory flavour and
\nclear indicia of power __ constitutional or statutory, and its
\npotential or capability to act to the detriment of fundamental rights
\nof the people, which makes it an authority; though in a given case,
\ndepending on the facts and circumstances, an authority may also
\nbe found to be an instrumentality or agency of the State and to that
\nextent they may overlap.  Tests 1, 2 and 4 in Ajay Hasia enable
\ndetermination of Governmental ownership or control.  Tests 3, 5
\nand 6 are ‘functional’ tests.  The propounder of the tests himself
\nhas used the words suggesting relevancy of those tests for finding
\nout if an entity was instrumentality or agency of the State.
\nUnfortunately thereafter the tests were considered relevant for
\ntesting if an authority is the State and this fallacy has occurred
\nbecause of difference between ‘instrumentality and agency’ of the
\nState and an ‘authority’ having been lost sight of  sub-silentio,
\nunconsciously and un-deliberated.  In our opinion, and keeping in
\nview the meaning which ‘authority’ carries, the question whether
\nan entity is an ‘authority’ cannot be answered by applying Ajay
\nHasia tests.\n<\/p>\n
(2)\tThe tests laid down in Ajay  Hasia’s case are relevant for the
\npurpose of determining whether an entity is an instrumentality
\nor agency of the State.\t Neither all the tests are required to be
\nanswered in positive nor a positive answer to one or two tests
\nwould suffice.\tIt will depend upon a combination of one or
\nmore of the relevant factors depending upon the essentiality and
\noverwhelming nature of such factors in identifying the real
\nsource of governing power, if need be by removing the mask or
\npiercing the veil disguising the entity concerned.   When an
\nentity has an independent legal existence, before it is held to be
\nthe State, the person alleging it to be so must satisfy the Court
\nof brooding presence of government or deep and pervasive
\ncontrol of the government so as to hold it to be an
\ninstrumentality or agency of the State.\n<\/p>\n
CSIR, if ‘the State’?\n<\/p>\n
\tApplying the tests formulated hereinabove, we are clearly of the
\nopinion that CSIR is not an ‘authority’ so as to fall within the meaning
\nof expression ‘other authorities’ under Article 12.  It has no statutory
\nflavour __ neither it owes its birth to a statute nor is there any other
\nstatute conferring it with such powers as would enable it being
\nbranded an authority.  The indicia of power is absent.\tIt does not
\ndischarge such functions as are governmental or closely associated
\ntherewith or being fundamental to the life of the people.\n<\/p>\n
\tWe may now examine the characteristics of CSIR.\t On a careful
\nexamination of the material available consisting of the memorandum
\nof association, rules and regulations and bye-laws of the society and
\nits budget and statement of receipts and outgoings, we proceed to
\nrecord our conclusions.\t The Government does not hold the entire
\nshare capital of CSIR.\tIt is not owned by the Government.  Presently,
\nthe Government funding is about 70% and grant by Government of
\nIndia is one out of five categories of avenues to derive its funds.
\nReceipts from other sources such as research, development,
\nconsultation activities, monies received for specific projects and job
\nwork, assets of the society, gifts and donations are permissible sources
\nof funding of CSIR without any prior permission\/consent\/sanction
\nfrom the Government of India.  Financial assistance from the
\nGovernment does not meet almost all expenditure of the CSIR and
\napparently it fluctuates too depending upon variation from its own
\nsources of income.  It does not enjoy any monopoly status, much less
\nconferred or protected by Government.  The governing body does not
\nconsist entirely of Government nominees.  The membership of the
\nsociety and the manning of its governing body – both consist
\nsubstantially of private individuals of eminence and independence
\nwho cannot be regarded as hands and voice of the State.\t There is no
\nprovision in the rules or the byelaws that the government can issue
\nsuch directives as it deems necessary to CSIR and the latter is bound
\nto carry out the same.\tThe functions of the CSIR cannot be regarded
\nas governmental or of essential public importance or as closely related
\nto governmental functions or being fundamental to the life of the
\npeople or duties and obligations to public at large.  The functions
\nentrusted to CSIR can as well be carried out by any private person or
\norganization.\tHistorically it was not a department of government
\nwhich was transferred to CSIR.\tThere was a Board of Scientific and
\nIndustrial Research and an Industrial Research Utilisation Committee.
\nThe CSIR was set up as a society registered under the Societies
\nRegistration Act, 1860 to coordinate  and generally exercise
\nadministrative control over the two organizations which would tender
\ntheir advice only to CSIR.  The membership of the society and the
\ngoverning body of the council may be terminated by the President not
\nby the Government of India.  The governing body is headed by the
\nDirector General of CSIR and not by the President of Society (i.e. the
\nPrime Minister).  Certainly the board and the committee, taken over
\nby CSIR, did not discharge any regal, governmental or sovereign
\nfunctions.  The CSIR is not the offspring or the blood and bones or the
\nvoice and hands of the government.  The CSIR does not and cannot
\nmake law.\n<\/p>\n
\tHowever, the Prime Minister of India is the President of the
\nsociety.  Some of the members of the society and of the governing
\nbody are persons appointed ex-officio by virtue of their holding some
\noffice under the Government also.  There is some element of control
\nexercised by the government in matters of expenditure such as on the
\nquantum and extent of expenditure more for the reason that financial
\nassistance is also granted by the Government of India and the later
\nwishes to see that its money is properly used and not misused.\tThe
\nPresident is empowered to review, amend and vary any of the
\ndecisions of the governing body which is in the nature of residual
\npower for taking corrective measures vesting in the President but then
\nthe power is in the President in that capacity and not as Prime
\nMinister of India. On winding up or dissolution of CSIR any
\nremaining property is not available to members but ‘shall be dealt
\nwith in such manner as Government of India may determine’.  There
\nis nothing special about such a provision in Memorandum of
\nAssociation of CSIR as such a provision is a general one applicable to
\nall societies under Section 14 of the Societies Registration Act, 1860.
\nTrue that there\t is some element of control of the government but not
\na deep and pervasive control.  To some extent, it may be said that
\nGovernment’s presence or participation is felt in the society but such
\npresence cannot be called a brooding presence or the overlordship of
\ngovernment.  We are satisfied that the tests in Ajay Hasia’s case are
\nnot substantially or on essential aspects even satisfied to call CSIR an
\ninstrumentality or agency of the State.\t A mere governmental
\npatronage, encouragement, push or recognition would not make an
\nentity ‘the State’.\n<\/p>\n
\tOn comparison, we find that in substance CSIR stands on a
\nfooting almost similar to the Institute of Constitutional and
\nParliamentary Studies (in Tekraj Vasandi @ K.L. Basandhi Vs.
\nUnion of India & Ors., (1988) 1 SCC 236) and National Council of
\nEducational Research and Training (in Chander Mohan Khanna Vs.
\nNCERT, (1991) 4 SCC 578), and those cases were correctly decided.\n<\/p>\n
\tStrong reliance was placed by the learned counsel for the
\nappellants on a notification dated 31.10.1986 issued in exercise of the
\npowers conferred by sub-Section (2) of Section 14 of the
\nAdministrative Tribunals Act, 1985 whereby the provisions of sub-
\nSection (3) of Section 14 of the said Act have been made applicable to
\nthe Council of Scientific and Industrial Research, “being the society
\nowned or controlled by government”.  On point of fact we may state
\nthat this notification, though of the year 1986, was not relied on or
\nreferred to in the pleadings of the appellants.\t We do not find it
\nmentioned anywhere in the proceedings before the High Court and not
\neven in the SLP filed in this Court.  Just during the course of hearing
\nthis notification was taken out from his brief by the learned counsel
\nand shown to the Court and the opposite counsel.  It was almost
\nsprung as a surprise without affording the opposite party an
\nopportunity of giving an explanation.  The learned Attorney General
\npointed out that the notification was issued by Ministry of Personnel,
\nPublic Grievances and Pensions (Department of Personnel and
\nTraining) and he appealed to the Court not to overlook the practical
\nside in the working of the government where at times one department
\ndoes not know what the other department is doing.  We do not
\npropose to enter into a deeper scrutiny of the notification.  For our
\npurpose, it would suffice to say that Section 14 of the Administrative
\nTribunals Act, 1985, and Article 323A of the Constitution to which
\nthe Act owes its origin, do not apparently contemplate a society being
\nbrought within the ambit of the Act by a notification of Central
\nGovernment.  Though, we guardedly abstain from expressing any
\nopinion on this issue as the present one cannot be an occasion for
\nentering into that exercise.  Moreover, on the material available, we
\nhave recorded a positive finding that CSIR is not a society “owned or
\ncontrolled by Government”.   We cannot ignore that finding solely by
\nrelying on the contents of the notification wherein we find the user of
\nrelevant expression having been mechanically copied but factually
\nunsupportable.\n<\/p>\n
\tFor the foregoing reasons, we are of the opinion that Council
\nfor Scientific and Industrial Research (CSIR) is not the State within
\nthe meaning of Article 12 of the Constitution.\tSabhajit Tewary’s case
\nwas correctly decided and must hold the field.\tThe High Court has
\nrightly followed the decision of this Court in Sabhajit Tewary.\t The
\nappeal is liable to be dismissed.\n<\/p>\n
J.\n<\/p>\n
( R.C. Lahoti )<\/p>\n
.J.\n<\/p>\n
( Doraiswamy Raju )<\/p>\n
April 16,2002<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical … on 16 April, 2002 Author: R Lahoti Bench: R.C. Lahoti, Doraiswamy Raju CASE NO.: Appeal (civil) 992 of 2002 PETITIONER: PRADEEP KUMAR BISWAS & ORS. Vs. RESPONDENT: INDIAN INSTITUTE OF CHEMICAL BIOLOGY & ORS. DATE OF JUDGMENT: 16\/04\/2002 BENCH: R.C. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-102241","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nPradeep Kumar Biswas & Ors vs Indian Institute Of Chemical ... on 16 April, 2002 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical ... on 16 April, 2002 - Free Judgements of Supreme Court & High Court | Legal India\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002\" \/>\n<meta property=\"og:site_name\" content=\"Free Judgements of Supreme Court & High Court | Legal India\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/LegalindiaCom\/\" \/>\n<meta property=\"article:published_time\" content=\"2002-04-15T18:30:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2017-04-30T06:06:17+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/i0.wp.com\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg?fit=512%2C512&ssl=1\" \/>\n\t<meta property=\"og:image:width\" content=\"512\" \/>\n\t<meta property=\"og:image:height\" content=\"512\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Legal India Admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@legaliadmin\" \/>\n<meta name=\"twitter:site\" content=\"@Legal_india\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Legal India Admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"46 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002\"},\"author\":{\"name\":\"Legal India Admin\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/person\\\/0bfdffe9059fb8bb24a86d094609c5ea\"},\"headline\":\"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical … on 16 April, 2002\",\"datePublished\":\"2002-04-15T18:30:00+00:00\",\"dateModified\":\"2017-04-30T06:06:17+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002\"},\"wordCount\":9207,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\"},\"articleSection\":[\"Supreme Court of India\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002\",\"name\":\"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical ... on 16 April, 2002 - Free Judgements of Supreme Court & High Court | Legal India\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#website\"},\"datePublished\":\"2002-04-15T18:30:00+00:00\",\"dateModified\":\"2017-04-30T06:06:17+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical … on 16 April, 2002\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#website\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\",\"name\":\"Free Judgements of Supreme Court & High Court | Legal India\",\"description\":\"Search and read the latest judgements, orders, and rulings from the Supreme Court of India and all High Courts. A comprehensive database for lawyers, advocates, and law students.\",\"publisher\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\"},\"alternateName\":\"Free judgements of Supreme Court & High Court of India | Legal India\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#organization\",\"name\":\"Judgements of Supreme Court & High Court | Legal India\",\"alternateName\":\"Legal India\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/wp-content\\\/uploads\\\/sites\\\/5\\\/2025\\\/09\\\/legal-india-icon.jpg\",\"contentUrl\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/wp-content\\\/uploads\\\/sites\\\/5\\\/2025\\\/09\\\/legal-india-icon.jpg\",\"width\":512,\"height\":512,\"caption\":\"Judgements of Supreme Court & High Court | Legal India\"},\"image\":{\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/logo\\\/image\\\/\"},\"sameAs\":[\"https:\\\/\\\/www.facebook.com\\\/LegalindiaCom\\\/\",\"https:\\\/\\\/x.com\\\/Legal_india\"]},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/#\\\/schema\\\/person\\\/0bfdffe9059fb8bb24a86d094609c5ea\",\"name\":\"Legal India Admin\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g\",\"caption\":\"Legal India Admin\"},\"sameAs\":[\"https:\\\/\\\/www.legalindia.com\",\"https:\\\/\\\/x.com\\\/legaliadmin\"],\"url\":\"https:\\\/\\\/www.legalindia.com\\\/judgments\\\/author\\\/legal-india-admin\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical ... on 16 April, 2002 - Free Judgements of Supreme Court & High Court | Legal India","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002","og_locale":"en_US","og_type":"article","og_title":"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical ... on 16 April, 2002 - Free Judgements of Supreme Court & High Court | Legal India","og_url":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002","og_site_name":"Free Judgements of Supreme Court & High Court | Legal India","article_publisher":"https:\/\/www.facebook.com\/LegalindiaCom\/","article_published_time":"2002-04-15T18:30:00+00:00","article_modified_time":"2017-04-30T06:06:17+00:00","og_image":[{"width":512,"height":512,"url":"https:\/\/i0.wp.com\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg?fit=512%2C512&ssl=1","type":"image\/jpeg"}],"author":"Legal India Admin","twitter_card":"summary_large_image","twitter_creator":"@legaliadmin","twitter_site":"@Legal_india","twitter_misc":{"Written by":"Legal India Admin","Est. reading time":"46 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002#article","isPartOf":{"@id":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002"},"author":{"name":"Legal India Admin","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/person\/0bfdffe9059fb8bb24a86d094609c5ea"},"headline":"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical … on 16 April, 2002","datePublished":"2002-04-15T18:30:00+00:00","dateModified":"2017-04-30T06:06:17+00:00","mainEntityOfPage":{"@id":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002"},"wordCount":9207,"commentCount":0,"publisher":{"@id":"https:\/\/www.legalindia.com\/judgments\/#organization"},"articleSection":["Supreme Court of India"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002","url":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002","name":"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical ... on 16 April, 2002 - Free Judgements of Supreme Court & High Court | Legal India","isPartOf":{"@id":"https:\/\/www.legalindia.com\/judgments\/#website"},"datePublished":"2002-04-15T18:30:00+00:00","dateModified":"2017-04-30T06:06:17+00:00","breadcrumb":{"@id":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.legalindia.com\/judgments\/pradeep-kumar-biswas-ors-vs-indian-institute-of-chemical-on-16-april-2002#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.legalindia.com\/judgments\/"},{"@type":"ListItem","position":2,"name":"Pradeep Kumar Biswas & Ors vs Indian Institute Of Chemical … on 16 April, 2002"}]},{"@type":"WebSite","@id":"https:\/\/www.legalindia.com\/judgments\/#website","url":"https:\/\/www.legalindia.com\/judgments\/","name":"Free Judgements of Supreme Court & High Court | Legal India","description":"Search and read the latest judgements, orders, and rulings from the Supreme Court of India and all High Courts. A comprehensive database for lawyers, advocates, and law students.","publisher":{"@id":"https:\/\/www.legalindia.com\/judgments\/#organization"},"alternateName":"Free judgements of Supreme Court & High Court of India | Legal India","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.legalindia.com\/judgments\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.legalindia.com\/judgments\/#organization","name":"Judgements of Supreme Court & High Court | Legal India","alternateName":"Legal India","url":"https:\/\/www.legalindia.com\/judgments\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/logo\/image\/","url":"https:\/\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg","contentUrl":"https:\/\/www.legalindia.com\/judgments\/wp-content\/uploads\/sites\/5\/2025\/09\/legal-india-icon.jpg","width":512,"height":512,"caption":"Judgements of Supreme Court & High Court | Legal India"},"image":{"@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/LegalindiaCom\/","https:\/\/x.com\/Legal_india"]},{"@type":"Person","@id":"https:\/\/www.legalindia.com\/judgments\/#\/schema\/person\/0bfdffe9059fb8bb24a86d094609c5ea","name":"Legal India Admin","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/4faa9d728ed1af3b73d52225c7f12901ac726fe6f7ea0a3348a1d51f3a930987?s=96&d=mm&r=g","caption":"Legal India Admin"},"sameAs":["https:\/\/www.legalindia.com","https:\/\/x.com\/legaliadmin"],"url":"https:\/\/www.legalindia.com\/judgments\/author\/legal-india-admin"}]}},"modified_by":null,"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts\/102241","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/comments?post=102241"}],"version-history":[{"count":0,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/posts\/102241\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/media?parent=102241"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/categories?post=102241"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.legalindia.com\/judgments\/wp-json\/wp\/v2\/tags?post=102241"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}