R. S. Madireddy vs Union Of India

2024 INSC 425 REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO (S) . OF 2024 (arising out of Special Leave Petition(C) No(s).23441-23444 of 2022)

MR. R.S. MADIREDDY …. APPELLANT(S) AND ANR. ETC.

VERSUS.

UNION OF INDIA & ORS. ETC. …. RESPONDENT(S)

WITH

CIVIL APPEAL NO(S). OF 2024 (arising out of Special Leave Petition (C) No(s). 12221 of 2023)

CIVIL APPEAL NO(S). OF 2024 (arising out of Special Leave Petition (C) No(s). 22777 of 2023)

JUDGMENT

Mehta, J.

1. Leave granted.

2. The present appeals are filed challenging the common Signature Not Verified Digitally signed by

impugned judgment and order dated 20th September, 2022 passed Deepak Singh Date: 2024.05.16 12:43:11 IST Reason:

by the Division Bench of the High Court of Bombay thereby

1 dismissing four writ petitions instituted by the appellants being

the former employees of respondent No.3 i.e. Air India

Limited(hereinafter referred to as ‘AIL’) as members of its cabin

crew force. Appellants came to be employed in AIL in the late

1980s and all of them retired between 2016 and 2018.

3. Writ Petition Nos. 123 of 20141 and 844 of 20142 were filed

for alleged stagnation in pay and non-promotion of the employees.

Writ Petition No. 844 of 2014 additionally raised issues of

anomalies in the fixation of pay arising out of and for

implementation of the report of the Justice Dharmadhikari

Committee3. Writ Petition Nos. 1770 of 20114 and 1536 of 20135,

pertained to the delay in payment of wage revision arrears and the

withdrawal of eight out of the seventeen allowances already paid

to the employees retrospectively. In each of the writ petitions,

violation of Articles 14, 16, and 21 of the Constitution of India,

1950, was pleaded. The Division Bench of Bombay High Court,

vide common judgment and order dated 20th September, 2022

disposed of the above writ petitions denying relief as claimed

1 Filed on 30th August, 2013 2 Filed on 09th October, 2014 3 Constituted by the respondent No.1 i.e. Union of India(through its Ministry of Civil Aviation)

to harmonize the differential service conditions of AIL and Indian Airlines Ltd, which came to be merged.

4 Filed on 14th June, 2011 5 Filed on 19th March, 2013

2 therein on the ground of non-maintainability of the writ petitions

owing to the intervening event of privatisation of respondent No.

3(AIL). Nevertheless, liberty was granted to the employee

petitioners to seek their remedies in accordance with law.

Brief Facts: -

4. Air India was a statutory body constituted under the Air

Corporations Act, 1953. With the repeal of the Act of 1953 by the

Air Corporations(Transfer of Undertakings) Act, 1994, Air India

merged with Indian Airlines and upon incorporation, respondent

No. 3(AIL) became a wholly Government owned company and,

thus, came under the category of ‘other authorities’ within the

meaning of Article 12 of the Constitution of India. This status of

Air India continued to subsist on the date when the subject batch

of writ petitions(supra) under Article 226 of the Constitution of

India were filed before the High Court invoking writ jurisdiction,

against respondent No.3(AIL).

5. However, on 08th October, 2021, the Government of India

announced that it had accepted the bid of Talace India Pvt Ltd. to

purchase its 100% shares in respondent No. 3 (AIL). Subsequently,

on 27th January, 2022 pursuant to the share purchase agreement

signed with Talace India Pvt. Ltd., 100% equity shares of the 3 Government of India in respondent No. 3(AIL) were purchased by

the said private company and respondent No. 3(AIL) was privatised

and disinvested. Therefore, the writ petitions were maintainable on

the date of institution but the question that arose before the High

Court was whether they continued to be maintainable as on the

date the same were finally heard.

6. Learned Judges of the Division Bench of the Bombay High

Court, while placing reliance upon the decisions of Tarun Kumar

Banerjee v. Bharat Aluminium Co. Ltd. and Another6 ; Mahant

Pal Singh v. Union of India and Others7 ; Padmavathi

Subramaniyan and Others v. Ministry of Civil Aviation

Government of India rep by its Secretary and Others 8 ; and

few more decisions of the Delhi High Court and Gujarat High Court

concluded that with the privatisation of respondent No. 3(AIL),

jurisdiction of the High Court under Article 226 of the Constitution

of India to issue a writ to respondent No. 3(AIL), particularly in its

role as an employer, did not subsist and disposed of the writ

petitions vide common impugned judgment dated 20th September

2022, which is assailed in the present appeals by special leave.

6 2008 SCC OnLine Bom 1899 7 2009 SCC OnLine Bom 2554 8 2022 SCC OnLine Kar 1706

4 Submissions and contentions on behalf of the appellants: -

7. Shri Sanjay Singhvi, learned senior counsel appearing on

behalf of the appellants submitted that the right to seek remedy

stands crystallised on the date of institution of proceedings and

though subsequent events can be considered, it is a well settled

tenet of law that such subsequent events can be looked at only to

advance equity rather than to defeat it. Reliance in this regard was

placed by learned senior counsel upon Pasupuleti

Venkateswarlu v. Motor & General Traders9; Beg Raj Singh v.

State of U.P. and Ors.10. He urged that different view is

permissible only in exceptional circumstances and in no event can

a party be divested of its substantive rights on account of such

subsequent event as laid down in Rajesh D. Darbar and Others

v. Narasingrao Krishnaji Kulkarni and Others11. The relevant

extract of Rajesh D. Darbar(supra) as relied upon by the learned

senior counsel for the appellants is extracted hereinbelow: -

“4. The impact of subsequent happenings may now be spelt out. First, its bearing on the right of action, second, on the nature of the relief and third, on its importance to create or destroy substantive rights. Where the nature of the relief, as originally sought, has become obsolete or unserviceable or a new form of relief will be more efficacious on account of developments subsequent to the suit or even during the

9 (1975) 1 SCC 770 10 (2003) 1 SCC 726 11 (2003) 7 SCC 219

5 appellate stage, it is but fair that the relief is moulded, varied or reshaped in the light of updated facts. Patterson v. State of Alabama [294 US 600 : 79 L Ed 1082 (1934)] (US at p. 607) illustrates this position. It is important that the party claiming the relief or change of relief must have the same right from which either the first or the modified remedy may flow. Subsequent events in the course of the case cannot be constitutive of substantive rights enforceable in that very litigation except in a narrow category (later spelt out) but may influence the equitable jurisdiction to mould reliefs. Conversely, where rights have already vested in a party, they cannot be nullified or negated by subsequent events save where there is a change in the law and it is made applicable at any stage. Lachmeshwar Prasad Shukul v. Keshwar Lal Chaudhuri [1940 FCR 84 : AIR 1941 FC 5] falls in this category. Courts of justice may, when the compelling equities of a case oblige them, shape reliefs — cannot deny rights — to make them justly relevant in the updated circumstances. Where the relief is discretionary, courts may exercise this jurisdiction to avoid injustice. Likewise, where the right to the remedy depends, under the statute itself, on the presence or absence of certain basic facts at the time the relief is to be ultimately granted, the court, even in appeal, can take note of such supervening facts with fundamental impact. This Court's judgment in Pasupuleti Venkateswarlu v. Motor & General Traders [(1975) 1 SCC 770 : AIR 1975 SC 1409] read in its statutory setting, falls in this category. Where a cause of action is deficient but later events have made up the deficiency, the court may, in order to avoid multiplicity of litigation, permit amendment and continue the proceeding, provided no prejudice is caused to the other side. All these are done only in exceptional situations and just cannot be done if the statute, on which the legal proceeding is based, inhibits, by its scheme or otherwise, such change in the cause of action or relief. The primary concern of the court is to implement the justice of the legislation. Rights vested by virtue of a statute cannot be divested by this equitable doctrine (see V.P.R.V. Chockalingam Chetty v. Seethai Ache [AIR 1927 PC 252 : 26 All LJ 371] ).”

8. Reliance was also placed by the learned senior counsel on the

judgment of Ashok Kumar Gupta & Ors. v. Union of India &

Ors.12, wherein the Division Bench of Calcutta High Court, after

12 (2007) SCC OnLine Cal 264

6 adverting to the extant principles concerning the maintainability

of writ proceedings as on the date of the institution, held that an

employer which had been privatised during the pendency of a writ

appeal filed against the order rejecting the writ petition would

continue to be amenable to writ jurisdiction under Article 226 of

the Constitution of India. The relevant portion of Ashok Kumar

Gupta(supra) relied upon is extracted hereinbelow: -

“32. It is nobody's case that the writ petition was not maintainable when it was filed. The cause of action for filing the writ petition crystallized at a point of time when the respondent authority was, admittedly, subject to the writ jurisdiction. The said cause of action confers a vested right to the writ petitioners to have their grievances adjudicated in a writ proceeding. No one can contend that the writ petitioners have brought the present situation by their conduct. The change of circumstances is not attributable to the petitioners.

33. For the aforesaid reasons, we are of the opinion that the instant appeal is very much maintainable, and the preliminary objection raised on behalf of the respondent company cannot be sustained in the eye of law. Therefore, the said preliminary objection regarding maintainability of this appeal as raised by the respondent company is rejected.”

9. Learned senior counsel further contended that the scope of

issuing a writ, order, or direction under Article 226 of the

Constitution of India is much broader than the high prerogative

writs issued by the British Courts and this position has been

recognised by this Court in the case of Andi Mukta Sadguru

Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav

7 Smarak Trust and Ors. v. V.R. Rudani & Ors.13, and following

the said decision, Courts in India have consistently issued writs

even to private persons performing public duties and this position

has further been reiterated by the recent judgment of this Court in

the case of Kaushal Kishor vs. State of Uttar Pradesh and

Ors.14. The relevant portions of Andi Mukta(supra) as relied upon

by the learned senior counsel are extracted hereinbelow: -

“16. The law relating to mandamus has made the most spectacular advance. It may be recalled that the remedy by prerogative writs in England started with very limited scope and suffered from many procedural disadvantages. To overcome the difficulties, Lord Gardiner (the Lord Chancellor) in pursuance of Section 3(1)(e) of the Law Commission Act, 1965, requested the Law Commission “to review the existing remedies for the judicial control of administrative acts and omissions with a view to evolving a simpler and more effective procedure”. The Law Commission made their report in March 1976 (Law Commission Report No. 73). It was implemented by Rules of Court (Order 53) in 1977 and given statutory force in 1981 by Section 31 of the Supreme Court Act, 1981. It combined all the former remedies into one proceeding called Judicial Review. Lord Denning explains the scope of this “judicial review”: “At one stroke the courts could grant whatever relief was appropriate. Not only certiorari and mandamus, but also declaration and injunction. Even damages. The procedure was much more simple and expeditious. Just a summons instead of a writ. No formal pleadings. The evidence was given by affidavit. As a rule no cross-examination, no discovery, and so forth. But there were important safeguards. In particular, in order to qualify, the applicant had to get the leave of a judge. The statute is phrased in flexible terms. It gives scope for development. It uses the words “having regard to”. Those words are very indefinite. The result is that the courts are not bound hand and foot by the previous law. They are to “have regard to” it. So the previous law as to who are — and who are not —

13 (1989) 2 SCC 691 14 (2023) 4 SCC 1

8 public authorities, is not absolutely binding. Nor is the previous law as to the matters in respect of which relief may be granted. This means that the judges can develop the public law as they think best. That they have done and are doing.” [ See The Closing Chapter by Rt. Hon. Lord Denning, p. 122]

17. There, however, the prerogative writ of mandamus is confined only to public authorities to compel performance of public duty. The “public authority” for them means everybody which is created by statute — and whose powers and duties are defined by statute. So government departments, local authorities, police authorities, and statutory undertakings and corporations, are all “public authorities”. But there is no such limitation for our High Courts to issue the writ “in the nature of mandamus”. Article 226 confers wide powers on the High Courts to issue writs in the nature of prerogative writs. This is a striking departure from the English law. Under Article 226, writs can be issued to “any person or authority”. It can be issued “for the enforcement of any of the fundamental rights and for any other purpose.”

10. He further submitted that equity should prevail over injustice

and since the appellants have diligently pursued their case in the

High Court for more than a decade, subsequent events can be

accounted for only to support and not undermine equity. It was

further contended that a private body that promises the sovereign

to fulfill its obligations and liabilities as a public employer towards

its employees under Articles 14 & 16, then performs a public duty

to the extent of discharging such liabilities. It is not the form, but

the nature of the duty imposed that is relevant for adjudging

whether a writ petition would lie against a private body. Reliance

in support of this contention was placed upon the following

9 extracts from the decision of this Court in Binny Ltd. and Anr. v.

V. Sadasivan and Ors.15:-

“23. The counsel for the respondent in Civil Appeal No. 1976 of 1998 and for the appellant in the civil appeal arising out of SLP (Civil) No. 6016 of 2002 strongly contended that irrespective of the nature of the body, the writ petition under Article 226 is maintainable provided such body is discharging a public function or statutory function and that the decision itself has the flavour of public law element and they relied on the decision of this Court in Shri Anadi Mukta Sadguru Shree Muktajee Vandas Swami Suvarna Jayanti Mahotsav Smarak Trust v. V.R. Rudani [(1989) 2 SCC 691] . In this case, the appellant was a Trust running a science college affiliated to the Gujarat University under the Gujarat University Act, 1949. The teachers working in that college were paid in the pay scales recommended by the University Grants Commission and the college was an aided institution. There was some dispute between the University Teachers Association and the University regarding the fixation of their pay scales. Ultimately, the Chancellor passed an award and this award was accepted by the State Government as well as the University and the University directed to pay the teachers as per the award. The appellants refused to implement the award and the respondents filed a writ petition seeking a writ of mandamus and in the writ petition the appellants contended that the college managed by the Trust was not an “authority” coming within the purview of Article 12 of the Constitution and therefore the writ petition was not maintainable. This plea was rejected and this Court held that the writ of mandamus would lie against a private individual and the words “any person or authority” used in Article 226 are not to be confined only to statutory authorities and instrumentalities of the State and they may cover any other person or body performing public duty. The form of the body concerned is not very much relevant.

What is relevant is the nature of the duty imposed on the body. The duty must be judged in the light of positive obligation owed by the person or authority to the affected party. No matter by what means the duty is imposed, if a positive obligation exists, mandamus cannot be denied.”

11. Learned senior counsel further contended that when a

private employer steps into the shoes of a public employer i.e. to

15 (2005) 6 SCC 657

10 perform the same functions as had previously been performed to

the same end and substantially in the same manner, then its

actions are amenable to judicial review. Reliance in support of this

contention was placed upon the decision of the United Kingdom

Court of Appeal in Regina(Beer(trading as Hammer Trout

Farm)) v. Hampshire Farmers’ Markets & Ltd.16.

12. It was further contended that the writ petitions came to be

instituted on behalf of the appellants herein way back in the year

2011-2013 and at that point of time unquestionably the employer,

i.e. respondent No. 3(AIL) was a ‘State’ within the ambit and

purview of Article 12 of the Constitution of India. The writ petitions

were filed with genuine and bona fide service-related issues of the

appellant employees based on substantive allegations of

infringement of fundamental rights guaranteed under Article 14

and Article 16 of the Constitution of India. However, the writ

petitions could not be taken up and decided for over a period of

almost 10 years and thus, the appellants cannot be non-suited for

the non-disposal of their bona fide lis in a timely manner. He thus

urged that appellants herein are entitled to the relief, as claimed

for in the writ petitions because the employer i.e. respondent No.

16 [2004] 1 WLR 233

11 3(AIL), undisputedly was amenable to writ jurisdiction at the time

the writ petitions were instituted and that it continues to discharge

public duties even after privatisation.

13. On these grounds, learned senior counsel for the appellants

implored the Court to accept the appeals; set aside the impugned

judgment and remand the writ petitions to the High Court for

adjudication on merits.

Submission and contentions on behalf of respondent No. 3-

AIL: -

14. Shri Abhishek Manu Singhvi, learned senior counsel

appearing on behalf of respondent No. 3(AIL) contended that a bare

reading of Article 226 of the Constitution of India, would clearly

show that the ‘test of jurisdiction’ is to be invoked/applied at the

time of issuance of the writ by the High Court. It is at the stage of

issuance of a writ that the High Court actually exercises its writ

jurisdiction, and therefore, it is at that point of time, the High

Court ought to be satisfied that the person to whom it is issuing a

writ is amenable to the extraordinary writ jurisdiction.

15. Learned senior counsel placed reliance upon the decision of

the High Court of Gujarat in the case of Kalpana Yogesh Dhagat

12 through Legal Heirs v. Reliance Industries Ltd. 17, wherein a

writ petition had been filed against Indian Petrochemical

Corporation Ltd.(“IPCL”) in 2002 which came to be decided in the

year 2016. In the intervening period, the IPCL was privatized and

taken over by Reliance Industries Limited(RIL) in 2007. The

pertinent issue that cropped up for consideration was whether the

writ petition filed against IPCL was maintainable even after its

privatization. Learned Single Judge18 of the Gujarat High Court

held that the writ petition was not maintainable. The relevant

portion of Kalpana Yogesh Dhagat(supra) as relied upon is

extracted hereinbelow:-

“53. In the case in hand, before the writ application could be taken up for final hearing, the status of I.P.C.L. changed. The I.P.C.L. once a public sector enterprise is no longer in existence, the same has been taken over by the Reliance Industries Limited. At no point of time, the legality and validity of the amalgamation of the I.P.C.L. with the Reliance Industries Limited arose before any Court. In such circumstances, I find it extremely difficult to hold that this writ application is maintainable and that too by applying the provisions of Order 22 Rule 10 of the Code of Civil Procedure. Ultimately, the whole issue boils down as to how a writ can be issued against a private entity.”

16. Learned senior counsel further placed reliance upon the

decision of the High Court of Delhi in Asulal Loya vs. Union of

17 2016 SCC OnLine Guj 10186 18 HMJ J.B. Pardiwala (as his lordship then was)

13 India and Ors.19, wherein learned Single Judge20 arrived at the

same conclusion, while dealing with a writ petition filed against

the Bharat Aluminium Company Limited(BALCO) in the year 1991

and decided in 2008 i.e., post-privatization of BALCO in 2001. The

relevant portions from the said judgment as relied upon are

extracted hereinbelow: -

“3. It is fairly well settled that a writ petition is not maintainable against a private limited company or a public limited company in which the State does not exercise all pervasive control. In Binny Limited v. V. Sadasivan, reported in (2005) 6 SCC 657, the Supreme Court has held that a writ petition under Article 226 of the Constitution is normally issued against public authorities and can also be issued against private authorities when they are discharging public functions and the decision which is sought to be corrected or enforced must be in discharge of a public function. In the present case, the issues and questions involved do not relate to public functions. ***

10. In these circumstances, the present writ petition is dismissed without going into the merits of the matter upholding the preliminary objection raised by the respondent company that it is not a State and, therefore, not amenable to writ jurisdiction. It is, however, observed that the petitioner is at liberty to approach any forum for redressal of his grievance, if so advised and the time spent by him in these proceedings shall be taken into consideration for the purpose of limitation. In the facts and circumstances of the case, there will be no order as to costs.”

17. Learned senior counsel further submitted that this Court in

the case of Kaushal Kishor(supra) has held that a writ cannot be

issued against non-state entities that are not performing any

19 ILR (2009) I Delhi 450 20 HMJ Sanjeev Khanna (as his lordship then was)

14 ‘Public Function’. He further pointed out that it is the conceded

case of the appellants that post privatisation, respondent No.

3(AIL) does not perform any ‘Public Function’ and in any case

running a private airline with purely a commercial motive can

never be equated to performing a ‘Public Duty’.

18. He further submitted that the issue is not that of a ‘Right’ but

of a ‘Remedy’ i.e. dismissal of a writ petition filed by the appellants

on the ground of maintainability would not lead to extinguishment

of the rights of the appellants and only the forum for adjudication

of their dispute would change. Any alleged violations of Articles 14

or 16 of the Constitution of India are simply grounds for claiming

relief which can well be agitated before any other appropriate

forum.

19. Learned senior counsel further submitted that appellants’

rights, if any, are protected by the specific liberty granted to them

by the High Court vide the impugned judgment and if a Court of

competent jurisdiction was to hold in their favour, the same would

be enforceable against the employer-respondent No. 3(AIL).

20. He further contended that the appellants employees

approached the writ Court after significant delay, since the cause

of action arose between 2007 to 2010 and captioned writ petitions 15 came to be filed before the Division Bench of the Bombay High

Court between 2011 to 2013 and implored the Court to dismiss

the appeals.

21. We have given our thoughtful consideration to the

submissions advanced by learned counsel for the parties and have

gone through the impugned judgment and the material placed on

record.

Questions of law posed for adjudication: -

22. The questions of law presented for adjudication of this Court

are:

(i) Whether respondent No.3(AIL) after having been taken over

by a private corporate entity could have been subjected to writ

jurisdiction of the High Court?

(ii) Whether the appellants herein could have been non-suited

on account of the fact that during pendency of their writ petitions,

the nature of the employer changed from a Government entity to a

private entity?

(iii) Whether the delay in disposal of the writ petition could be

treated a valid ground to sustain the claim of the appellants even

against the private entity?

16 Discussion and Conclusion: -

23. The thrust of submissions of learned senior counsel

appearing on behalf of the appellants was based on the judgment

of the Division Bench of Calcutta High Court in the case of Ashok

Kumar Gupta(supra) wherein, it was held in para 32(reproduced

supra) that the cause of action crystallized at a point of time when

the authority was subjected to the writ jurisdiction.

24. Ashok Kumar Gupta’s case(supra) was distinguished by the

learned Single Judge of the Gujarat High Court in the case of

Kalpana Yogesh Dhagat(supra). The relevant excerpts from the

said judgment are reproduced hereinbelow for the sake of ready

reference: -

“50. There is no doubt that if the dictum, as explained by the Division Bench of the Calcutta High Court (Ashok Kumar Gupta vs. Union of India, (2007) SCC OnLine Cal 264) is applied in the case in hand, then probably, the writ application could be said to be maintainable. However, there are few distinguishing features, which, in my view, are important as they go to the root of the matter. First, in the case before the Calcutta High Court even at the time when the writ application was rejected, the company was a public sector undertaking; Secondly, even when the appeal was filed, the same was a public sector undertaking; and thirdly and most importantly, the issue as regards the propriety and legality of the privatisation was pending before the Larger Bench of the Supreme Court.” (emphasis supplied)

25. In the case of Kalpana Yogesh Dhagat(supra), the learned

Single Judge of the Gujarat High Court went on to uphold the 17 preliminary objection regarding the maintainability of the writ

petition against Reliance Industries Limited(RIL). The relevant

excerpts from the said judgment are extracted hereinbelow: -

“19. …..However, the scope of mandamus is determined by the nature of the duty to be enforced, rather than the identity of the authority against whom it is sought. If the private body is discharging public function, the pubic law remedy can be enforced. The duty cast upon a public body may be either statutory or otherwise and the source of such power is immaterial, but, nevertheless, there must be a public law element in such action. The respondent Reliance Petro Investment Limited has nothing to do with the public as such. It is a company engaged in the business of petroleum products. Neither the Union nor the ‘State’ has any control over the respondent company. Mere issue of a licence by the Union or State Government for the purpose of running the company by itself will not make it an instrumentality of a “State” or an agency of a “State”.

***

21. The language of Article 226 is no doubt very wide. It states that a writ can be issued “to any person or authority” and “for enforcement of right conferred by Part III and for any other purpose”. However, the aforesaid language in Article 226 cannot be interpreted and understood literally. The Court should not apply the literal rule of interpretation while interpreting Article 226. If we take the language of Article 226 literally it will follow that a writ can be issued to any private person or to settle even the private disputes. If we interpret the word “for any other purpose” literally it will mean that a writ can be issued for any purpose whatsoever, e.g. for deciding private disputes, for grant of divorce, succession certificate etc. Similarly, if we interpret the words “to any person” literally it will mean that a writ can even be issued to the private persons.

However, this would not be the correct meaning in view of the various decisions of the Supreme Court in which it has been held that a writ will lie only against the State or instrumentality of the State vide Chander Mohan Khanna v. N.C.E.R.T, (1991) 4 SCC 578, Tekraj Vasandhi v. Union of India, (1988) 1 SCC 236 : AIR 1988 SC 469, General Manager, Kisan Sahkari Chini Mills Ltd. v. Satrughan Nishad, (2003) 8 SCC 639, Federal Bank Ltd. v. Sagar Thomas & Co., (2003) 10 SCC 733, Pradeep Kumar Biswas v. Indian Institute of Chemical Biology ((2002) 5 SCC 111) etc. In General Manager, Kisan Sahkari Chini Mills

18 Ltd. v. Satrughan Nishad (supra), the Supreme Court observed that a writ will lie against a private body only when it performed a public function or discharged a public duty. The ‘R.I.L.’ is not performing a public function nor discharging a public duty. It is only doing a commercial activity. Hence, no writ lies against it.

***

58. Even if the aforesaid dictum of the Supreme Court is applied in the case in hand, it is difficult for this Court to take the view that as the writ applicant is not responsible for the change of circumstances and the writ application was maintainable at the time when it was filed, a writ can be issued to a private entity for the purpose of enforcing the fundamental rights of the writ applicant alleged to have been infringed by a company, a public sector undertaking at a point of time and now no longer in existence. It is also not legally permissible to take the view that since the I.P.C.L. was a Government of India undertaking, a writ could be issued against the Union of India. An employee of a public sector undertaking by itself will not be a civil servant or an employee of the Union of India. At best, he could be termed as an employee of a company owned by the Government. Therefore, even ignoring the I.P.C.L., no liability could be fastened even on the Government of India at this stage.

59. I am not impressed by the submission of Mr. Bhatt that the writ applicant has no other alternative remedy, except invoking the writ jurisdiction of this Court. According to Mr. Bhatt, since the original writ applicant i.e. the employee has passed away, it will be legally impermissible for the legal heirs to file a civil suit for declaration for the purpose of challenging the order of dismissal from service. The legal heirs on record can definitely file a civil suit for declaration that the departmental inquiry was not conducted in a fair and transparent manner and the consequential order of dismissal is illegal. Section 14 of the Limitation Act would also save the situation. Section 14 of the Limitation Act itself is meant for the suits.” (emphasis supplied)

26. The same controversy was also considered by a learned Single

Judge of the Delhi High Court in the case of Asulal Loya(supra)

which was a case involving the termination of services of the writ

19 petitioner-employee by the company Bharat Aluminium Company

Limited(BALCO) which was previously a Government of India

Undertaking and was privatized pursuant to the tripartite share

purchase agreement. The employee-writ petitioner filed a writ

petition before the Delhi High Court to challenge his termination

wherein, a preliminary objection was raised regarding

maintainability of the writ petition on the ground that during

pendency of the proceedings, the company had changed hands

and no longer retained the characteristic of a ‘State’ or ‘Other

authority’ as defined under Article 12 of the Constitution of India.

The assertion of the writ petitioner was that the petition was

maintainable against the respondent on the date it was filed. As

per the writ petitioner, the rights and obligations of the parties

stood crystallized on the date of commencement of litigation and

thus, the reliefs should be decided with reference to the date on

which the party entered the portals of the Court. The learned

Single Judge in para 10(reproduced supra) upheld the preliminary

objection raised against the maintainability of the writ petition and

relegated the writ petitioner therein to approach the civil Court for

ventilating the grievances raised in the writ petition. 20

27. The Division Bench of the Bombay High Court in the case of

Tarun Kumar Banerjee(supra) also took a similar view observing

as below: -

“1. Both the petitions were filed against Bharat Aluminium Co. Ltd. when the petitions were filed, it was a Government of India enterprise. We are told by the Respondent that they had filed an affidavit on 22-3-1996 thereby pointing out that Bharat Aluminium Co. Ltd. has been privatized and share of more than 50% have been transferred to Sterlit Industries India Ltd. and as a consequence Bharat Aluminium Company Ltd. is not a state and is not amenable to writ jurisdiction of this Court.

2. In view of this submission we dispose of both the petitions while granting the petitioner liberty to approach any other forum for redressal of their grievance if so advised. The time spent by the petitioners in prosecuting these proceeding shall be taken into consideration for the purpose of limitation in case the petitioner choose any such remedy where the question of limitation would be relevant.” (emphasis supplied)

28. Further, in the case of Beg Raj Singh(supra), this Court

observed as below: -

“7. …. A petitioner, though entitled to relief in law, may yet be denied relief in equity because of subsequent or intervening events, i.e. the events between the commencement of litigation and the date of decision. The relief to which the petitioner is held entitled may have been rendered redundant by lapse of time or may have been rendered incapable of being granted by change in law. There may be other circumstances which render it inequitable to grant the petitioner any relief over the respondents because of the balance tilting against the petitioner on weighing inequities pitted against equities on the date of judgment….” (emphasis supplied)

21

29. It is thus, seen that various High Courts across the country

have taken a consistent view over a period of time on the pertinent

question presented for consideration that the subsequent event i.e.

the disinvestment of the Government company and its devolution

into a private company would make the company immune from

being subjected to writ jurisdiction under Article 226 of the

Constitution of India, even if the litigant had entered the portals of

the Court while the employer was the Government. The only

exception is the solitary judgment of the Division Bench of Calcutta

High Court in Ashok Kumar Gupta(supra), which was

distinguished by the learned Single Judge of the Gujarat High

Court in the case of Kalpana Yogesh Dhagat(supra) and rightly

so, in our opinion, we have no hesitation in holding that the view

taken in the judgments of Kalpana Yogesh Dhagat(supra)(by the

High Court of Gujarat); Asulal Loya(supra)(by the High Court of

Delhi) and Tarun Kumar Banerjee(supra)(by the High Court of

Bombay) is the correct exposition on this legal issue and we grant

full imprimatur to the said proposition of law.

30. We would like to answer the three questions of law

enumerated above as follows.

22

31. In order to be declared as “State” or “other authority” within

the meaning of Article 12 of the Constitution of India, it would have

to fall within the well-recognised parameters laid down in a

number of judgments of this Court. In this regard, we may refer to

the case of Pradeep Kumar Biswas v. Indian Institute of

Chemical Biology21 wherein this Court after taking into

consideration the previous judgments on this point, observed as

follows:

“27.Ramana [(1979) 3 SCC 489 : AIR 1979 SC 1628] was noted and quoted with approval in extenso and the tests propounded for determining as to when a corporation can be said to be an instrumentality or agency of the Government therein were culled out and summarised as follows : (SCC p. 737, para 9) “(1) 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. (SCC p. 507, para 14)

(2) 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. (SCC p. 508, para 15)

(3) It may also be a relevant factor … whether the corporation enjoys monopoly status which is State-

conferred or State-protected. (SCC p. 508, para 15)

(4) Existence of deep and pervasive State control may afford an indication that the corporation is a State agency or instrumentality. (SCC p. 508, para 15)

21 (2002) 5 SCC 111 23 (5) If the functions of the corporation are 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. (SCC p. 509, para 16)

(6) ‘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. (SCC p. 510, para 18)”

40. The picture that ultimately emerges is that the tests formulated in Ajay Hasia [Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722 : 1981 SCC (L&S) 258] 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. The question in each case would be — whether in the light of the cumulative facts as established, the body is financially, functionally and administratively dominated by or under the control of the Government. 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.” (emphasis supplied)

32. There is no dispute that the Government of India having

transferred its 100% share to the company Talace India Pvt Ltd.,

ceased to have any administrative control or deep pervasive control

over the private entity and hence, the company after its

disinvestment could not have been treated to be a State anymore

after having taken over by the private company. Thus,

unquestionably, the respondent No.3(AIL) after its disinvestment

24 ceased to be a State or its instrumentality within the meaning of

Article 12 of the Constitution of India.

33. Once the respondent No.3(AIL) ceased to be covered by the

definition of State within the meaning of Article 12 of the

Constitution of India, it could not have been subjected to writ

jurisdiction under Article 226 of the Constitution of India.

34. A plain reading of Article 226 of the Constitution of India

would make it clear that the High Court has the power to issue the

directions, orders or writs including writs in the nature of Habeas

Corpus, Mandamus, Certiorari, Quo Warranto and Prohibition to

any person or authority, including in appropriate cases, any

Government within its territorial jurisdiction for the enforcement

of rights conferred by Part-III of the Constitution of India and for

any other purpose.

35. This Court has interpreted the term ‘authority’ used in Article

226 in the case of Andi Mukta(supra), wherein it was held as

follows:

“17. There, however, the prerogative writ of mandamus is confined only to public authorities to compel performance of public duty. The ‘public authority’ for them means everybody which is created by statute—and whose powers and duties are defined by statute. So government departments, local authorities, police authorities, and statutory undertakings and corporations, are all ‘public authorities’. But there is no such

25 limitation for our High Courts to issue the writ ‘in the nature of mandamus’. Article 226 confers wide powers on the High Courts to issue writs in the nature of prerogative writs. This is a striking departure from the English law. Under Article 226, writs can be issued to ‘any person or authority’. It can be issued ‘for the enforcement of any of the fundamental rights and for any other purpose’.

***

20. The term ‘authority’ used in Article 226, in the context, must receive a liberal meaning like the term in Article 12.

Article 12 is relevant only for the purpose of enforcement of fundamental rights under Article 32. Article 226 confers power on the High Courts to issue writs for enforcement of the fundamental rights as well as non-fundamental rights. The words ‘any person or authority’ used in Article 226 are, therefore, not to be confined only to statutory authorities and instrumentalities of the State. They may cover any other person or body performing public duty. The form of the body concerned is not very much relevant. What is relevant is the nature of the duty imposed on the body. The duty must be judged in the light of positive obligation owed by the person or authority to the affected party. No matter by what means the duty is imposed. If a positive obligation exists mandamus cannot be denied.” (emphasis supplied)

36. Further, in the case of Federal Bank Ltd. v. Sagar

Thomas 22, this Court culled out the categories of body/persons

who would be amenable to writ jurisdiction of the High Court

which are as follows:

“18. From the decisions referred to above, the position that emerges is that a writ petition under Article 226 of the Constitution of India may be maintainable against (i) the State (Government); (ii) an authority; (iii) a statutory body; (iv) an instrumentality or agency of the State; (v) a company which is financed and owned by the State; (vi) a private body run substantially on State funding; (vii) a private body discharging public duty or positive obligation of public nature; and (viii) a person or a body under liability to discharge any function under any statute, to compel it to perform such a statutory function.”

22 (2003) 10 SCC 733 26

37. The respondent No.3(AIL), the erstwhile Government run

airline having been taken over by the private company Talace India

Pvt. Ltd., unquestionably, is not performing any public duty

inasmuch as it has taken over the Government company Air India

Limited for the purpose of commercial operations, plain and

simple, and thus no writ petition is maintainable against

respondent No.3(AIL). The question No. 1 is decided in the above

manner.

38. The question of issuing a writ would only arise when the writ

petition is being decided. Thus, the issue about exercise of extra

ordinary writ jurisdiction under Article 226 of the Constitution of

India would arise only on the date when the writ petitions were

taken up for consideration and decision. The respondent

No.3(AIL)- employer was a government entity on the date of filing

of the writ petitions, which came to be decided after a significant

delay by which time, the company had been disinvested and taken

over by a private player. Since, respondent No.3 employer had been

disinvested and had assumed the character of a private entity not

performing any public function, the High Court could not have

exercised the extra ordinary writ jurisdiction to issue a writ to such

private entity. The learned Division Bench has taken care to 27 protect the rights of the appellants to seek remedy and thus, it

cannot be said that the appellants have been non-suited in the

case. It is only that the appellants would have to approach another

forum for seeking their remedy. Thus, the question No.2 is decided

against the appellants.

39. By no stretch of imagination, the delay in disposal of the writ

petitions could have been a ground to continue with and maintain

the writ petitions because the forum that is the High Court where

the writ petitions were instituted could not have issued a writ to

the private respondent which had changed hands in the

intervening period. Hence, the question No.3 is also decided

against the appellants.

40. Resultantly, the view taken by the Division Bench of the

Bombay High Court in denying equitable relief to the appellants

herein and relegating them to approach the appropriate forum for

ventilating their grievances is the only just and permissible view.

41. We may also note that the appellants raised grievances by way

of filing the captioned writ petitions between 2011 and 2013

regarding various service-related issues which cropped up between

the appellants and the erstwhile employer between 2007 and 2010.

Therefore, it is clear that the writ petitions came to be instituted 28 with substantial delay from the time when the cause of action had

accrued to the appellants.

42. It may further be noted that the Division Bench of Bombay

High Court, only denied equitable relief under Article 226 of the

Constitution of India to the appellants but at the same time, rights

of the appellants to claim relief in law before the appropriate forum

have been protected.

43. We may further observe that in case the appellants choose to

approach the appropriate forum for ventilating their grievances as

per law in light of the observations made by the Division Bench of

the Bombay High Court, Section 14 of the Limitation Act, 1963

shall come to the rescue insofar as the issue of limitation is

concerned.

44. In wake of the discussion made hereinabove, we do not find

any reason to take a different view from the one taken by the

Division Bench of the Bombay High Court in sustaining the

preliminary objection qua maintainability of the writ petitions

preferred by the appellants and rejecting the same as being not

maintainable.

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45. With the above observations, the appeals are dismissed. No

order as to costs.

46. Pending application(s), if any, shall stand disposed of.

………………….……….J. (B.R. GAVAI)

………………………….J. (SANDEEP MEHTA) New Delhi;

May 16, 2024

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