Court: Supreme Court of India.
Case Type: Civil Appeal.
Case No.: 3272 of 2003.
Date of Judgement: 14/08/2007
Petitioner’s Name: Lt. Governor of Delhi.
Respondent’s Name: V.K. Sodhi.
Bench: Justice:
- P.K. Balsubramanyan.
- P.P. Naolekar.
Statutes referred:
- Constitution of India.
Cases referred:
- Chander Mohan Khanna V. N.C.E.R.T. and Ors., 1991, 4 S.C.C. 578.
- Pradeep Kumar Biswas V. Indian Institute of Biology and Ors., 2002, 5 S.C.C. 111.
Fact:
Regulation 67 of the Rules and Regulation of the State Council of Education, Research and Training (S.C.E.R.T.), which provided that the terms and tenure of the academic staff at the Council shall remain the same as that of the academic staff at Nation Council of Education, Research and Training (N.C.E.R.T.), was retrospectively amended on 07/12/1999.
This amendment provided that the terms and tenure of service of the academic staff at Councill will be the same as available for the academic and other staff of the Directorate of Education, G.N.C.T. Delhi.
The respondents in this case (V.K.Sodhi and ors.) moved to the High Court of Delhi against the amendment.
The High Court issued a to the S.C.E.R.T. to implement Regulation 67 as it stood before the amendment.
The High Court dismissed the S.C.E.R.T. plea that it was merely a society registered under the Societies Registration Act.
The High Court also overruled the S.C.E.R.T. plea that it mainly depended on the Government grant for achieving objectives for which the Society was formed. Without the State Government’s approval, it was in no position to spend any part of the grant for the additional benefits of the employees.
Aggrieved by this decision rendered by the High Court, an appeal was filed in the Supreme Court.
Issue:
- Whether the S.C.E.R.T. can be said to be dominated by or under the control of the Government.
- Should the respondents from the provisions of Regulation 67 before it was amended.
Contention:
- Petitioner’s Contentions:
- The High Court was in error in examining whether the S.C.E.R.T. was a state or other authority within the meaning of Article 12 of India’s Constitution.
- S.C.E.R.T. was a society registered under the Societies Registration Act.
- The Society was the master of its affairs and was under no control of the Government.
- The Government was merely performing its duty toward education while making grants available for the S.C.E.R.T.
- The High Court was in error in ignoring the financial implications of the Society.
- If a significant portion of the grant is utilized for salaries and pensions of the employees, then the very purpose for which the Society was founded would be defeated.
- The retrospective amendment of Regulation 67 was not challenged in the High Court.
- There was no justification in the High Court that the non-existent Regulation 67, as it existed before the amendment, should be applied with respect to the writ petitioners.
- Respondent’s Contentions:
- The High Court was correct in its conclusion that the S.C.E.R.T. was a State under Article 12 of the Constitution.
- The employees were entitled to the benefits on the principle of ‘equal pay for equal work’.
- The High Court was correct in holding that the retrospective amendment of Regulation 67 could not affect the employees who were in place before the date of the amendment.
- The High Court had directed the S.C.E.R.T. to apply its regulations, and since it was an autonomous body, the direction was perfectly justified.
- Thus, the appeal was liable to be dismissed.
Obiter Dicta:
- The unamended Regulation 67 had never been implemented in the S.C.E.R.T. with respect to any of its employees. Therefore, there was no question of discrimination in the implementation of that Regulation.
- There is no litmus test to determine whether an entity is a state or authority within the meaning of Article 12 of the Constitution. Various aspects of the foundation and the workings of the entity would be relevant in determining this question.
- While the Society’s finance is provided by the Government, in administering the said finance, the Council of the S.C.E.R.T. was supreme.
- There is no government interference or control over the working of the Council.
- The Court observed:
- In the case of S.C.E.R.T., in addition to the operational autonomy of the Executive Committee, it could also amend its bye-laws subject to the provisions of the Delhi Societies Registration Act though with the previous concurrence of the Government of Delhi and that the proceedings of the Council are to be made available by the Secretary for inspection of the Registrar of Societies as per the provisions of the Societies Registration Act. The records and proceedings of the Council have also to be made available for inspection by the Registrar of Societies. In the case of dissolution of S.C.E.R.T., the liabilities and assets are to be taken over at book value by the Government of Delhi, which had to appoint a liquidator for completing the dissolution of the Body. The creditors’ loans and other liabilities of S.C.E.R.T. shall have a preference and bear the first charge on the assets of the Council at the time of dissolution. This is not unconditional vesting of the assets on dissolution with the Government. It is also provided that the provisions of the Societies Registration Act, 1860 had to be complied with filing a list of office-bearers every year with the Registrar and the carrying out of the amendments in accordance with the procedure laid down in the Act of 1860. The dissolution being in terms of Sections 13 and 14 of the Societies Registration Act, 1860 and making all the provisions of the Societies Registration Act applicable to the Society. These provisions, in our view, indicate that S.C.E.R.T. is subservient to the provisions of the Societies Registration Act rather than to the State Government and that the intention was to keep S.C.E.R.T. as an independent body
- Once we hold that S.C.E.R.T. is not a State or other authority within the meaning of Article 12 of India’s Constitution, we do not find ourselves persuaded to issue any such direction as sought for by the writ petitioners (the respondents herein). It becomes unnecessary to go into the question of the validity of the amendment of Regulation 67, the effect of the uniform non-implementation of Regulation 67 as it stood earlier, and the effect of the absence of a challenge in the writ petition to the amendment to the Regulation itself. It is also not necessary to go into the question whether S.C.E.R.T. should seek the permission of the Government for incurring additional expenditure in terms of service benefits to its employees.
Judgement:
- S.C.E.R.T. was held not a state within the meaning of Article 12 of the Constitution.
- The direction issued by the High Court could not be sustained.
- Both appeals were allowed.
- The directions of the High Court were set aside.
- Writ petitions filed by the petitioners were dismissed.
- The parties were directed to suffer their respective costs.
Rationale:
- The Government does not have deep or pervasive control over the working of the S.C.E.R.T.
- Once the funds are made available to the Council, the administration of those finance is wholly carried out by the S.C.E.R.T., and there is no further government interference.
Conclusion:
- There is no definitive test to determine whether an entity is ‘State’ or an authority within the meaning of Article 12 of the Constitution. The courts can only answer this question after a thorough examination of all the facts regarding the composition, administration, financial sources and use of finances, functions performed, etc., of the entities in question on a case-by-case basis.
Prepared by Mihir Poojary.