• Against whom were Fundamental Rights to

be enforced?
• Broadly speaking, against “the state”, not as
ordinary understood but as widely defined in
Article 12.Therefore, fundamental rights become
enforceable also against local or other authorities.

• Against what activities were Fundamental

Rights enforceable?
• They were enforceable against laws and executive
actions which violated fundamental rights
 Article 12. Definition

12. In this Part, unless the context otherwise requires, "the

State” includes the Government and Parliament of India and
the Government and the Legislature of each of the States and
all local or other authorities within the territory of India or
under the control of the Governmentof India.

1. Government of India
2. Parliament of India
3. Government of Each State
4. Legislature of each State
5. All local authorities
6. Other authorities
 LOCAL AUTHORITY
• The expression ‘local authority’ in Article 12 refers
to a unit of local self-Government like a municipal
committee or a village panchayat.

• S.3 (31) of the General Clauses Act defines

• “Local authority’ shall mean a
– municipal committee
– district board
– body of port commissioners or
– other authority legally entitled to, or entrusted by the
Government with, the control or management of a
municipal or local fund.”
 Characteristic of a ‘local authority’
• It must have a separate legal existence as a corporate body.
• It must not be government agency but must be legally an independent
entity.
• It must function in a defined area.
• It must ordinarily, wholly or partly, directly or indirectly, be elected by
the inhabitants of the area.

• It must also enjoy a certain degree of autonomy either complete or

partial.

• It must be entrusted by statute with such governmental functions and

duties as are usually entrusted to municipal bodies such as those
connected with providing amenities to the inhabitants of the locality like
health and education, water and sewerage, town planning and
development roads, markets, transportation, social welfare services, etc.

• Finally such a body must have the power to raise funds for furtherance of
its activities and fulfillment of its objectives by levying taxes, rates,
charges or fees.
 Calcutta State Transport Corporation v. Commr. Of Income
Tax, West Bengal AIR 1996 SC 1316

• The S.C refused to characterize the Calcutta State Transport

Corporation as a ‘local authority’.

• The corporation is meant only for the purpose of providing road

transport services and has no element of popular representations
in its constitution.

• Its powers and functions bear no relation to the powers and

functions of a municipal committee.

• It is more in nature of a trading corporation.

 Union of India v. R.C.Jain AIR 1981 SC 951

• Delhi Development Authority, a statutory body, held to

be a ‘local authority’ because it is constituted for the
specific purpose of development of Delhi according to
plan which is ordinarily a municipal function.
• The activities of the D.D.A. are limited to Delhi.
• It has some element of popular representation in its
composition and enjoys a considerable degree of
autonomy.
 Landmark Judgements on ‘Other Authorities”
University of Madras v. Shanta Bai AIR 1954 Mad 67 Ejusdem Generisis Test Statutory Body

Smt. Ujjam Bai v. State of Uttar Pradesh AIR 1962 SC 1621 (7) Rejected Ejusdem Generisis Test Quasi Judicial Bodies-State
or not?

Rajasthan State Electricity Board, Jaipur vs. Mohan Lal & Sovereign Function Test Statutory Body (RSEB)
Ors AIR 1967 SC 1857 (5)

Sabhaji Tewari v. U.O.I AIR 1975 SC1329 (5) CSIR –Registered Society –not a
state
(overruled by SC in Pradeep Kumar Biswas)
Sukhdev Singh v. Bhagatram AIR 1975 SC 1331 (5) Mathew,J. Agency /Instrumentality
Test
Non-Statutory Body-
Registered Society (CSIR)
Statutory Body (ONGC,LIC
& IFC)

R.D.Shetty v. International Airport Authority AIR 1979 SC Agency /Instrumentality Test Statutory Body (IAA)
1628 (3) Broader and more preferable test.

Som Prakash v. Union of India AIR 1981 SC 212 (5) Agency /Instrumentality Test Non-Statutory Body
(Government Company)

Ajay Hasia v. Khalid Mujib AIR 1981 SC 487 (5) Agency /Instrumentality Test Non-Statutory Body-
Registered Society (J&K
Regional Engineering
College)

Pradeep Kumar Biswas v. Indian Institute of Chemical Biology (2002) 5 Functional Test Non-Statutory Body-
SCC 111 Registered Society (CSIR)
overruled Sabhajit Case

Zee Telefilms Ltd. v. Union of India, (2005) 4 SCC 649 (3) Functional Test BCCI not a State
 Definition of ‘State’
• The definition in Article 12 is only for the purpose of
application of the provisions contained in Part III.

• The definition in Article 12 cannot be used to interpret any

provision outside Part III, e.g., 311.

• Hence, even though a statutory corporation, exercising statutory

powers, would be a ‘state; for the purposes of enforcing
fundamental rights against it (e.g. under article 12 or 14 or 16), its
employees cannot take advantage of Article 309-11, for, their
services are held not under the Government of India or of a
State, but under a separate legal entity may be regarded as ‘State’
for the purpose of Article 12, and its employees may resort to
Article 32 for violation of their fundamental rights by the
corporations.
 Definition of ‘State’

• What was the intention of the makers of

the Constitution?

Narrow definition of State

Or
Broader definition of State
Object of including all ‘authorities’ within the term state
• To enlarge the scope of the Fundamental rights.
• The object was thus explained by Dr. Ambedkar in the
Constituent assembly-(III C.A.D. 391-92)
• “The object of fundamental rights is twofold:
– First, that every citizen must be in a position to claim those rights.
– Secondly, they must be binding upon every authority….which has got either
the power to make laws or the power to have discretion vested in it.
• Therefore,….. If the fundamental rights are to be clear, they must be
binding not only upon the Central Government, they must not only
be binding upon the Provincial Government,…..they must also be
binding upon District Boards, Municipalities, even village Panchayats
and taluka boards, in fact, every authority which has been created
by law and which has got certain powers to make laws, to
make rules or make bye-laws”.
12. In this Part, unless the 13(3) In this article, unless
context otherwise requires, the context otherwise
"the State” includes the requires,
Government of India Ordinance

Parliament of India order

Government of Each State bye-law

Legislature of each State rule

All local authorities regulation

Other authorities notification

custom or usage having in the territory of India

the force of law

(b) “laws in force” includes laws passed or made by a Legislature or

other competent authority in the territory of India before the
commencement of this Constitution and not previously repealed,
notwithstanding that any such law or any part thereof may not be then
in operation either at all or in particular areas.
 Definition of ‘State’
• Broader definition of State and Law:

• By defining “the State” and “law” very widely, the founding fathers
ensured that fundamental rights operated over the widest field.

• Wider the meaning attributed to the term “other authorities” in

Article 12, wider will be the coverage of the F.Rs as more and
more bodies can be brought within the discipline of the FRs.
 Meaning of ‘Other Authorities”
• ‘Other Authorities’ caused a good deal of difficulty

• Judicial opinion has undergone changes over time.

• Government acting departmentally, or through officials, undoubtedly ,falls

within the definition of state.

• Doubts have been cast as regards the character of autonomous bodies.

• Whether autonomous bodies could be regarded as ‘authorities’ under

Article 12 and thus, be subject to Fundamental Rights?

• An autonomous body may be a statutory body ,i.e., a body set up directly by a

statute, or it may be a non-statutory body., a body registered under a general
law, such as, the Companies Act, the Societies Registration Act , or a State
Co-operative Societies Act, etc.

• WHETHER SUCH BODIES MAY BE INCLUDED WITHIN THE

COVERAGE OF ARTICLE 12 ?
 State acts through

Government Department Autonomous Bodies

Statutory Bodies Non-Statutory

Fall within the
Bodies Setup Bodies
definition of State
directly under a Bodies registered
Statute under a Law.

Whether they could be regarded as ‘authorities’

under Article 12 and thus be subject to
Fundamental Rights?
 Meaning of Ejusdem Generisis
• "of the same kind,"

• used to interpret loosely written statutes.

• Where a law lists specific classes of persons or things and then
refers to them in general, the general statements only apply to the
same kind of persons or things specifically listed.

• E.g – if a law refers to automobiles, trucks, tractors, motorcycles

and other motor-powered vehicles, "vehicles" would not include
airplanes, since the list was of land-based transportation.
 University of Madras
v.
Shanta Bai AIR 1954 Mad 67
 University of Madras v. Shanta Bai AIR 1954 Mad 67

• Whether University of Madras is a State or not?

• Madras High Court held:
• (PARA 5) The question is whether the University can be held to be "local or other
authority" as defined in Article 12. These words must be construed 'ejusdem generis'
with Government or Legislature and so construed can only mean authorities
exercising governmental functions. They would not include persons natural or
Juristic who cannot be regarded as Instrumentalities of the Government. The
University of Madras is a body corporate created by Madras Act VII of 1923. It is
not charged with the execution of any Governmental functions; Its purpose is
purely to promote education. Though Section 44 of the Act provides for financial
contribution by the local Government, the University is authorised to raise its own
funds of income from fees, endowments and the like. It is a State-aided
institution, but it is not maintained by the State.
• (PARA 12). Our conclusions are that the University of Madras is not a state as
defined in Article 12 of the Constitution and that its regulations are not subject to
the prohibition enacted in Article 15(1).
 University of Madras v. Shanta Bai AIR 1954 Mad 67
• So construed it could only means-
– Authorities exercising governmental or sovereign
powers & functions.

• On these interpretation, the expression ‘other authorities’

would only include such bodies as are functioning for or
on behalf of the Central or State Government.

• Madras High Court interpreted the term “Other

authorities” very narrowly.

• Restricted Interpretation of the expression “other

authorities’ rejected by the Supreme Court.
Smt. Ujjam Bai v. State of Uttar Pradesh AIR 1962 SC
1621
• Ayyangar, J., interpreting the words other authorities" in Art. 12,
held:
• "Again, Art. 12 winds up the list of authorities falling within the
definition by referring to "other authorities" within the territory of
India WHICH CANNOT OBVIOUSLY BE READ AS EJUSDEM
GENERIS with either the Government and the Legislatures or
local authorities.

• The words are of wide amplitude and capable of comprehending

EVERY AUTHORITY CREATED UNDER A STATUTE and
functioning, within the territory of India or under the control of the
Government of India.

• There is no characterization of the nature of the "authority" in this

residuary clause and consequently it must include every type of
authority set up under a statute for the purpose of administering
laws enacted by the Parliament or by the State including those
vested with the duty to make decisions in order to implement
those laws."
 K. S. Ramamurthy Reddiar v. The Chief
Commissioner, Pondicherry, AIR 1963 SC 1464

• All local or other authorities within the territory

of India include all authorities within the territory
of India whether under the control of the
Government of India or the Governments of
various States and
even autonomous authorities which may not be
under the control of the Government at all."
J.C.Shah

Vashishtha Bhargava
Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC 1857

Appellant: Electricity Board of Rajasthan , Jaipur, a body

corporate constituted on 1st July 1957 under the Electricity
Supply Act, 1948.

Respondents: Mohanlal & Others: Permanent employees of

the State Government.

Issue:-Whether Rajasthan Electricity Board is a State under

Article 12 or not?
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC 1857
ARGUMENTS ON BEHALF OF THE APPELLANTS

• Board could not be held to be covered by expression "other authorities".

• The expression "other authorities", if read ejusdem generis with those
named, cannot cover the Board which is a body corporate having a
separate existence and has been constituted primarily for the purpose of
carrying on commercial activities.
• In support of his proposition that the expression “other authorities”
should be interpreted ejusdem generis, he relied on University of Madras
v. Shantha Bai, AIR 1954 Mad 67 where the HC held: “These words must
be construed ‘ejusdem generis’ with government or Legislature, and, so
construed, can only mean authorities exercising governmental functions.
They would not include persons natural or jurisitic who cannot be
regarded as instrumentalities of the Government.”
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC 1857
Supreme Court on Ejusdem Generis
• (para 4) High Courts fell into an error in applying the principle of ejusdem
genericis when interpreting the expression “other authorities” in Article 12
of the Constitution as they overlooked the basic principle of interpretation
that, to invoke the application of ejusdem generis rule, there must be a
distinct genus or category running through the bodies already named.

• SC cited Craies on Statue Law & Maxwell book on “Interpretation of

Statutes.

• There is no common genus running through these named bodies.

• (Para 5) In article 12 of the Constitution, the bodies specifically named are

the Executive Governments of the Union and the States, the Legislature of
the Union and the States, and local authorities. We are unable to find any
common genus running through these named bodies , nor can these
bodies be placed in case single on any rational basis. The doctrine of
ejusdem generis could not therefore, be applied to the interpretation of the
expression “other authorities” in this article.
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC 1857
• Supreme Court relied upon dictionary meaning of ‘Other Authority”
• (PARA 6)The meaning of the word “authority” given in Webster’s third
New International Dictionary, which can be applicable, is “a public
administrative agency or corporation having quasi-governmental
powers and authorized to administer a revenue-producing public
enterprise.”
• This dictionary meaning of the word "authority" is clearly wide enough to
include all bodies created by a statute on which powers are conferred to carry
out governmental or quasi-governmental functions.

• The expression "other authorities" is wide enough to

include within it every authority created by a statute and
functioning within the territory of India, or under the
control of the Government of India; and we do not see any
reason to narrow down this meaning in the context in
which the words “other authorities” are used in Article 12 of
the Constitution.
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC 1857

SC referred to Ujjam Bai Case

(Para 7) In Smt Ujjam Bai v. State of UP,(1963) Ayyangar,J., interpreting the
words “other authorities” in Article 12 held: “Again, Article 12 winds up the list
of authorities falling within the definition by referring to “other authorities
within the territory of India which cannot be obviously be read as ejusdem
generis with either the Government and the Legislature or Local authorities. The
words are of wide amplitude and capable of comprehending every
authority created under a statute and functioning within the territory of
India or under the Control of India. There is no characterization of the
nature of the ‘authority’ in this residuary clause and consequently it must
include every type of authority set up under a statute for the purpose of
administrating laws enacted by the Parliament or by the State including
those vested with the duty to make decisions in order to implement those
laws.”

In K.S. Ramamurhty Reddiar v. The Chief Commissioner, Pondicherry &

Anr, 1963, SC held: “Further, all local or other authorities within the territory of
India include all authorities within the territory of India whether under the
control of the GOI or the Government of various states and even autonomous
authorities which may not be under the control of the Government at all.”
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC 1857
After refering to the above judgements Supreme Court in Mohan Lal
case held in Para 7

“These decisions of the Court support our view that the expression
“other authorities” in Art. 12 will include all constitutional or
statutory authorities on whom powers are conferred by law.It is not
at all material that some of the powers conferred may be for the
purpose of carrying on commercial activities. The State is itself
envisaged as having the right to carry on trade or business as
mentioned in Art. 19 (1) (g). In Part IV, the State has been given the
same meaning as in article 12 and one of the Directive Principles lie
down in Article 46 is that the state shall promote with special care the
educational and economic interests of the weaker section of the
people. The state, as defined in Article 12, is thus comprehend to
include bodies created for the purpose of promoting the educational
and economic interests of the people.
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC 1857
Commercial Functions
• The State, as constituted by our Constitution, is further specifically
empowered under Art. 298 to carry on any trade or business. The
circumstances that the Board under the Electricity Supply Acts is
required to carry on some activities of the nature of trade or
commerce does not, therefore, give any indication that the Board
must be excluded from the scope of the word “State” as used in
Article 12. On the other hand, there are provisions in the Electricity
Supply Act which clearly show that the powers conferred on the
Board include power to give directions, the disobedience of which is
punishable as a criminal offence.The Board was clearly an authority
to which the provisions of Part III of the Constitution were
applicable.

• (Para 8)- We have already held earlier that, in dealing with the case of respondent
no.1, the board did not treat him on terms of equality with respondents Nos 4 to
14 and did not afford to him the opportunity for being considered for promotion
to which he was entitled on that basis The High Court was, therefore, right in
allowing the petition of respondent no. 1. The appeal is dismissed.
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC 1857
• SHAH, J.
• Shah, J. who delivered a separate judgment, agreeing with the conclusion reached
by the majority, preferred to give a slightly different meaning to the expression
"other authorities".
• The Board is an authority invested by statute with certain sovereign powers
of the State. It has the power of promoting coordinated development, generation, supply and distribution of
electricity and for that purpose to make , alter, amend and carry out schemes under Ch V of the Act, to engage in
certain incidental undertakings; to organize and carry out power and hydraulic surveys to conduct investigation for
the improvement of the methods of transmission; to close down generating stations; to conduct investigation for the
improvement of the methods of transmission; to close down generating stations; to compulsory purchase generating
stations, undertakings, mains and transmission lines; to place wires, poles, brackets, appliances, apparatus, etc; to fix
grid tariff; to issue directions for securing the maximum economy and efficiency in the operation of electricity
undertakings; to make rules and regulations for carrying out the purpose of the At; and to issue directions under
certain provisions of the Act and to enforce compliance with those directions. The board is also invested by statute
The power to make rules and
with extensive powers of control over electricity undertakings.
regulations and to administer the Act is in substance the sovereign power
of the state delegated to the Board. The Board is, in my judgement, “other
authority” within the meaning of Article 12 of the Constitution.
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SC1857
• (Para 11) I am unable, to agree that every constitutional or statutory authority
on whom powers are conferred by law is “other authority” within the meaning
of Article 12. The expression “authority” in its etymological sense means a
body invested with power to command or give an ultimate decision, or enforce
obedience, or having a legal right to command and be obeyed.

• (Para 13) In my judgement, authorities, constitutional or statutory invested

with power by law but not sharing the sovereign power do not fall within the
expression “State” as defined in Article 12. Those authorities which are
invested with sovereign power i.e., power to make rules or regulations and to
administer or enforce them to the detriment of citizens and others fall within
the definition of “State” in Article 12, and constitutional or statutory bodies
which do not share that sovereign power of the state are not, in my judgement,
“State” within the meaning of Article 12 of the Constitution.
 Rajasthan State Electricity Board, Jaipur v. Mohan Lal
AIR 1967 SUPREME COURT 1857

• Ratio of RSEB judgements as per Bhagwati,J. in

R.D.Shetty Case
“a constitutional or statutory authority would be within the
meaning of the expression "other authorities", if it has
been invested with statutory power to issue binding
directions to the parties, the disobedience of which would
entail penal consequence or it has the sovereign power to
make rules and regulations having the force of law.”
Sukhdev Singh v. Bhagatram AIR 1975 SC 1331

• Coram: 5

• A. N. Ray, C.J.I.,

• K. K. Mathew,

• Y. V. Chandrachud,

• A. Alagiriswami AND

• A. C. Gupta, JJ.
 Sukhdev Singh v. Bhagatram AIR 1975 SC 1331

• Test laid down in Electricity Board case was adopted by Ray, C.J., in
Sukhdev v. Bhagat Ram . Mathew, J., however, in the same case,
adopted a new line of approach, which, later, has been adopted
unanimously by 5 Judges in Ajay Hasia case, namely,
– whether the statutory corporation or other body or authority, claimed to
fall within the definition of 'State', is an INSTRUMENTALITY OR
AGENCY OF GOVERNMENT:
– if it is, it would fall within the meaning of the expression 'other
authorities' and would be 'State'.
 Sukhdev Singh v. Bhagatram, AIR 1975 SC 1331

Facts: Dismissed employees claimed reinstatement.

State contended:
i. That regulations made under a Statute affecting matters of internal
management “do not have a statutory binding character”. Regulations
provided the terms and condition of employment and thereafter the
employment of any person was contractual;
ii. That the three Corporations were not “other authorities” within the
meaning of Article 12.
Main Issue
• Whether statutory corporations such as the
– ONGC,
– IFC and
– LIC
• created by the
– Oil & Natural Gas Commission Act, 1959,
– Industrial Finance Act, 1948,
– Life Insurance Act,1956,
• came within the definition of ‘the State’ under Article 12.
 Sukhdev Singh v. Bhagatram, AIR 1975 SC 1331

• Two questions for consideration for these appeals:

• First, whether an order for removal from service contrary to
regulations framed under the ONGC, IFC,LIC, would enable
the employees to a declaration against the statutory corporation
of continuance in service or would only give rise to a claim for
damages.
• Second, whether an employee of a statutory corporation is
entitled to claim protection of articles 14 and 16 against the
corporation.
• In short, the question is whether these statutory corporations are
authorities within the meaning of Article 12?
Sukhdev Singh v. Bhagatram AIR 1975 SC 1331

• By majority of 4 to 1, the court held that

• these corporations were state.

• Ray C.J. adopted the test laid down by the majority

in the RSEB case and held that-
– The three corporations were created by the statutes.
– They have the statutory power to make binding rules &
regulations.
– They are subject to pervasive government control.

• Therefore, they are ‘other authorities’ within the

meaning of Article 12.
 K.K.Mathew,J.
Separate but concurrent Judgement

• Students are strongly advised to read Justice Mathew’s judgement.

• In a concurring judgement, Mathew J. adopted a new line of approach, which , as will

appear hereafter, has been adopted unanimously in International Airport Authority
and Ajay Hasia case.
Sukhdev Singh v. Bhagatram AIR 1975 SC 1331
Alagiriswamy,J., Dissenting Judgement

• The whole purpose of part III was to confer fundamental

rights on the citizens against the powers of the state.

• As none of these corporations shared the sovereign power,

these could not be ‘State’.
 Sabhajit Tewari v. Union of India AIR 1975 SC 1329
• Sabhajit Tewary was decided by the same bench on the
same day as Sukhdev Singh.
• Supreme Court ruled :
• Indian Council of Scientific Research, a body registered under
the Societies Registration Act (non-statutory body), but under a
good deal of governmental control & funding , is not a ‘state’.
• The writ petition was dismissed ostensibly because the
Court factored into its decision two premises:
i) "The society does not have a statutory character like the Oil
and Natural Gas Commission or the Life Insurance
Corporation or Industrial Finance Corporation. It is a Society
incorporated in accordance with the provisions of the Society's
Registration Act", and
Sabhajit Tewari v. Union of India, AIR 1975 SC 1329
ii) "This Court has held in Praga Tools Corporation V. Shri C.A.
Imanual & Ors. [1969] 3 SCR 773, Heavy Engineering Mazdoor
Union v. The State of Bihar & Ors. [1969] 3 SCR 995 and in S.L.
Agarwal v. General Manager Hindustan Steel Ltd. [1970]3 SCR 363
that the Praga Tools Corporation, Heavy Engineering Mazdoor
Union and Hindustan Steel Ltd. are all companies incorporated
under the Companies Act and the employees of these companies
do not enjoy the protection available to Government servants as
contemplated in Article 311. The companies were held in these
cases to have independent existence of the Government and
by the law relating to corporations. These could not be held to
be departments of the Government".
• Overruled by the Supreme Court in Pradeep Kumar Biswas
(2002)
 R.D.Shetty v. International Airport Authority
AIR 1979 SC 1628

• The 'drastic changes' in the perception of 'State'

heralded in Sukhdev Singh by Mathew, J and the tests
formulated by him were affirmed and amplified in
International Airport Authority case.
 R.D.Shetty v. International Airport Authority
AIR 1979 SC 1628
Facts of the case
• The IAA is a body corporate constituted under the IAA Act 1971.
• The Director of the Authority issued a Notice inviting tenders for putting up and
running a second class restaurant and two snack bars at the IA at Bombay.
• Six tenders were received.
• The 4th respondent’s tender offered the highest license fee, the remaining five
offering decreasing amounts as license fee.
• The fourth respondent’s tender was complete, the tenders of the remaining five were
incomplete.
• The 4th Respondent was not a “Registered II nd class Hotlier having at least 5 years
experience”, but had considerable experience in running canteens for big
corporations.
• After correspondence between the 4th respondent and the Director of the Authority,
the Director accepted the 4th Respondent’s tender.
• One KC Irani, one of the five tenders,, instituted legal proceedings to question the
Director’s decision.
• After Irani had failed in two successive suits to get an interim stay, the appellant,
who had not put in a tender, filed a writ petition which was rejected by the Bombay
HC He applied for, and obtained, special leave to appeal to the SC.
 R.D.Shetty v. International Airport Authority AIR 1979 SC 1628

• The 'drastic changes' in the perception of 'State' heralded in Sukhdev Singh

by Mathew, J and the tests formulated by him were affirmed and amplified
in Ramana v. International Airport Authority of India . OR In the Airport
Authority case the doctrine of agency and State instrumentality was adopted
by Bhajwati J.
• Must read paragraphs from the judgement
• Paragraphs-13,14,15,16,17,18,19,20,21,22,23,2425,,26,27,28,32
• (para 28) Whilst accepting the test laid down in Rajasthan Electricity Board
v. Mohan Lal (supra), and followed by Ray, C.J. in Sukhdev v. Bhagat Ram
(supra), we would prefer to adopt the test of GOVERNMENTAL
INSTRUMENTALITY OR AGENCY AS ONE MORE TEST and
PERHAPS A MORE SATISFACTORY ONE for determining whether a
statutory corporation, body or other authority falls within the definition of
'State'.
• If a statutory corporation, body or other authority is an instrumentality or
agency of Government, it would be an 'authority' and therefore 'State'
within the meaning of that expression in Article 12.
Som Prakash v. Union of India AIR 1981 SC 212

• Burmah shell was nationalized and vested in the

Government itself under the Burmah Shell
(Acquisition of Undertakings in India) Act, 1976 .

• The act provided that the undertaking would be

vested in the government company.

• Accordingly, the undertaking was taken over by

the Bharat Petroleum Corporation, a government
company registered under the Indian Companies
Act.
 Som Prakash v. Union of India AIR 1981
SC 212
• Whether Bharat Petroleum-which was
neither a government department nor a
statutory body but merely a company –could
be regarded as an “authority” under Article
12.
Som Prakash v. Union of India AIR 1981 SC 212
• Supreme Court held:
• Bharat Petroleum is a state under Article 12.

• The true test for the purpose whether a body was an

‘authority’ or not was not whether it was formed by a
statute, or under a statute, but it was “functional”.

• In instant case, the key factor was “the brooding presence

of the state behind the operations of the body, statutory or
other”.
 In this case, the body was semi-statutory and semi-non-statutory.
 It was non-statutory in origin (as it was registered).
 It was recognized by the act Burmah Shell (Acquisition of
Undertakings in India) Act, 1976, and thus had some “statutory
flavour” in its operations and functions.
Ajay Hasia v. Khalid Mujib
AIR 1981 SC 487
 Ajay Hasia v. Khalid Mujib , AIR 1981 SC 487

• The question regarding the status of a non-statutory body was finally

clinched in Ajay Hasia case.

• The tests propounded by Mathew, J in Sukhdev Singh were elaborated

in Ramana and were re-formulated two years later by a Constitution
Bench in Ajay Hasia v. Khalid Mujib Sehravardi .
 Facts
• These writ petitions under Article 32 of the Constitution challenge the validity
of the admissions made to the Regional Engineering College, Srinagar for the
academic year 1979-80.
• The Regional Engineering College, Srinagar (hereinafter referred to as the
College) is one of the fifteen Engineering Colleges in the country sponsored
by the Government of India. The College is established and its administration
and management are carried on by a Society registered under the Jammu and
Kashmir Registration of Societies Act, 1898.
• The petitioners feeling aggrieved by this mode of selection filed the present
writ petitions challenging the validity of the admissions made to the college
on various grounds.
• The respondents contended that the college is run by society which is
not a corporation created by a statute but is a society registered under
the Jammu & Kashmir Societies Registration Act, 1898 and it is
therefore not an 'authority' within the meaning of Article 12 of the
Constitution and no writ petition can be maintained against it, nor can
any complaint be made that it has acted arbitrarily in the matter of granting
admissions and violated the equality clause of the Constitution.
 Ajay Hasia v. Khalid Mujib AIR 1981 SC 487
• Whether a society registered under the Societies Registration Act
running the regional engineering college, sponsored, supervised and
financially supported by the government is state or not ?

• Supreme Court held:-

• Regional engineering college is a state under Article 12.

• Money to run the college was provided by the State & Central
Governments.

• The state government could review the functioning of the college

and issue suitable instructions if considered necessary.

• Where a corporation is an instrumentality of the Government, it must

be held to be an authority under Article 12.

• “The concept of instrumentality or agency of the government is not

limited to a corporation created by a statute but is equally applicable
to a company or society.”
 Test laid down by Supreme Court in Ajay Hasia Case

VERY IMPORTANT

(Para 9)
• The tests for determining as to when a corporation can be said to be an
instrumentality or agency of Government may now be culled out from
the Judgement in the International Airport Authority's case (AIR 1979 SC
1628). These tests are not conclusive or clinching, but they are merely
indicative indicia which have to be used with care and caution, because
while stressing the necessity of a wide meaning to be placed on the
expression "other authorities", it must be realized that it should not be
stretched so far as to bring in every autonomous body which has some
nexus with the Government with the sweep of the expression. A wide
enlargement of the meaning must be tempered by a wise limitation . We
may summarise the relevant tests gathered from the decision in the
International Airport Authority's case as follows :
 Test laid down by Supreme Court in Ajay Hasia Case
• (Para 9 Continue)
• (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."

• (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."

• (3) "It may also be a relevant factor... .... whether the corporation enjoys monopoly status
which is the State conferred or State protected."

• (4) "Existence of "deep and pervasive State control may afford an indication that the
Corporation is a State agency or instrumentality."

• (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.

• (6) "Specifically, if a department of Govt. 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".
 Ajay Hasia v. Khalid Mujib AIR 1981 SC 487

• If on a consideration of these relevant factors it is found that the

corporation is an instrumentality or agency of government, it would, as
pointed out in the International Airport Authority's case, be an
'authority' and, therefore, 'State' within the meaning of the expression
in Art. 12.
• The important question is not how the juristic person is born, but why
has it been brought into existence?
• It does not matter –
– what is the structure of the body in question: it may be statutory or non-statutory; it
may be set up by , or under , an act of the Legislature or even administratively.

– whether the body in question has been set up initially by the government or by
private enterprise.

– what functions does the body discharge; it may be governmental, semi-

governmental, educational, commercial, banking, social service.
 Other Important Cases
P.K. Ramachandra Iyer and Ors. v. Union of India and Ors. 1983
• Indian Council of Agricultural Research (ICAR) and its affiliate Indian Veterinary
Research Institute were bodies as would be comprehended in the expression 'other
authority' in Article 12 of the Constitution.
B.S. Minhas v. Indian Statistical Institute and Ors.
• Indian Statistical Institute, a registered Society is an instrumentality of the Central
Government and as such is an 'authority' within the meaning of Article 12.
Central Inland Water Transport Corporation Ltd. v. Brojo Nath
• Central Inland Water Transport Corporation Ltd. is covered by Article 12
• “If there is an instrumentality or agency of the state which has assumed the garb
of a government company as defined in s.617 of the Companies Act, it does not
follow that it thereby ceases to be an instrumentality or agency of the state. For
the purposes of Article 12, one must necessarily see through the corporate veil to
ascertain whether behind the veil is the face of an instrumentality or agency of
the state.”
Tekraj Vasandi alias K.S. Basandhi v. Union of India and Ors. 1988 (1) SCC 237
• Institute of Constitutional and Parliamentary Studies (ICPS), a society registered under
the Societies Registration Act, 1860 fell outside the purview of ‘State’.
 Other Important Cases
All India Sainik Schools Employees' Association v. Defence Minister-cum-
Chairman Board of Governors,Sainik Schools Society, New Delhi 1988
• Sainik School Society is a 'State'.

Chandra Mohan Khanna v. National Council of Educational Research & Training, AIR 1992
SC 76
• The NCERT is a society registered under the Societies Registration Act. After considering the
provisions of its Memorandum of Association as well as the rules of NCERT, this Court came to
the conclusion that since NCERT was largely an autonomous body and the activities of the
NCERT were not wholly related to governmental functions and that the Government control was
confined only to the proper utilisation of the grant and since its funding was not entirely from
Government resources, the case did not satisfy the requirements of the State under Article 12 of
the Constitution.
Mysore Paper Mills Ltd. vs. The Mysore Paper Mills Officers Association JT 2002 (1) SC 61
• Company substantially financed and financially controlled by the
Government, managed by a Board of Directors nominated and removable at
the instance of the Government and carrying on important functions of
public interest under the control of the Government is 'an authority' within
the meaning of Art.12
 Pradeep Kumar Biswas
v.
Indian Institute of Chemical Biology (2002) 5 SCC 111
Pradeep Kumar Biswas v. Indian Institute of Chemical Biology
(2002) 5 SCC 111

• Student’s are strongly advised to read the entire judgment.

• PK Biswas formally overruled Sabhajit Tewary, but more importantly , further narrowed the
‘agency or instrumentality’ test. Tracking the interpretation of ‘State’ from RSEB through
Sukhdev, Ajay Hasia, and up until Mysore Paper Mills, the Court held that a body would qualify
as ‘State’ under Article12 where, in light of the cumulative facts, it was ‘financially, functionally,
and administratively dominated by or under the control of the Government’. Mere regulatory
control over the body would not suffice.
• Though apparently summing up the law, the majority decision in PK Biswas did much more. It
confirmed the Court’s preference for structuralism. Secondly, it imposed a more onerous
standard than previously because the body had to now meet governmental domination on all the
three fronts: financially, functionally and administratively. Thirdly, it sealed the future of an open-
ended functionalist inquiry by completely ignoring Biman Krishna Bose and the ‘trappings of the
State’ framework applied there. Fourthly, it ignored the text of Article 12, which made a
distinction between local or other authorities ‘within the territory of India’ on the one hand, and
‘under the control of the Government of India’ on the other.
(For more details read Chapter 32 “RIGTHS breadth, scope, and applicability” authored by Ananth Padmanabhan
contributed in The Oxford Handbook of The Indian Constitution.}
 Pradeep Kumar Biswas v. Indian Institute of Chemical
Biology (2002) 5 SCC 111
• Supreme Court overruled Sabhajit Tiwary case.
• Held :-
– Council of Scientific & Industrial Research CSIR) is an authority under Article
12.
– “the control of the Government in CSIR is ubiquitous.” (Ever-present)
• S.C has now laid down the following proposition for identification of
“authorities” within article 12:
• The SC after refering to the previous judgements concluded in the following words:
40. The picture that ultimately emerges is that the tests formulated in Ajay Hasia are
not a rigid set of principles so that if a body falls within any one of them it must, ex
hypothesi, be considered to be a State within the meaning of Article 12. 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
regulatory under statute or otherwise, it would not serve to make the body a
state”.
 Zee Telefilms Ltd.
v.
Union of India, (2005) 4 SCC 649
 Zee Telefilms Ltd. v. Union of India, (2005) 4 SCC 649

• Writ petition was filed under Article 32 against the Board of Control for
Cricket in India (BCI) due to a refusal on its part to deal with a television
broadcaster for the live broadcast of games organized by the Board.

• Mr. K.K. Venugopal, learned senior counsel appearing for the Board has
raised the preliminary issue in regard to the maintainability of this petition on
the ground that under Article 32, a petition is not maintainable against the
Board since the same is not "State" within the meaning of Article 12 of the
Constitution of India. It is this issue which is being considered in this
judgment.
 Zee Telefilms Ltd. v. Union of India, (2005) 4 SCC 649
• BCCI’s (Respondent No.2) Contention
Mr. K.K. Venugopal has contended that
• the Board is not created by any statute and is only registered under the Societies
Registration Act 1860 and that
• The board is an autonomous body, administration of which is not controlled by
any other authority including Union of India
• The board does not take any financial assistance from the Government nor is it
subjected to any financial control by the Government or its accounts are subject
to the scrutiny of the Government.
• The board though in the field of Cricket enjoys a monopoly status the same is
not conferred on the Board by any statute or by any order of the Government.
• As per the parameters laid down by this Court in Pradeep Kumar Biswas v.
Indian Institute of Chemical Biology and Ors. MANU/SC/0330/2002 :
[2002]3SCR100 the Board cannot be construed as a State for the purpose of
Article 12 and the said judgment being a judgment of Seven Judge Bench of this
Court is binding on this Bench.
 Zee Telefilms Ltd. v. Union of India, (2005) 4 SCC 649
Zee Telefilms (Petitioner’s) Contentions
Mr. Harish N. Salve, learned senior counsel appearing on behalf of the petitioners opposing the preliminary
objections submitted that
• Board has extensive powers in selecting players for the Indian National team representing India in test
matches domestically and internationally.
• Board has the authority of inviting foreign teams to play in India.
• Board is the sole authority for organising major cricketing events in India and
• Board has the disciplinary power over the players/umpires and other officials involved in the game and
sports being a subject under the control of the States, in substance the Board exercises governmental
functions in the area of Cricket.
• Absolute authority of the Board is because of the recognition granted by the Government of India,
hence in effect even though it is as an autonomous body the same comes under "other authorities"
for the purpose of Article 12.
• Board has the authority to determine whether a player would represent the country or not.
• Playing cricket is a profession the Board controls the fundamental right of a citizen under Article
19(1)(g) of the Constitution.
• Many of the vital activities of the Board like sending a team outside India or inviting foreign teams to
India is subject to the prior approval of the Government of India. Hence, the Union of India has
pervasive control over the activities of the Board.

For all these reasons, he submitted that the Board is "other authorities" within the meaning of Article 12.
Zee Telefilms Ltd. v. Union of India, (2005) 4 SCC 649
Supreme Court held that:
• Board of Cricket Control In India(BCCI) is not a State for the following reasons-
1. The Board is not created by a Statute.
2. No part of the share capital of the Board is held by Government.
3. Practically no financial assistance is given by the Government to meet the whole or
entire expenditure of the Board.
4. The Board does enjoy a monopoly status in the field of cricket, but such status is not
State conferred or State Protected.
5. There is no deep or pervasive State Control. The control, if any, is only
regulatory in nature as applicable to similar bodies and the control is not
specifically exercised under any special statute applicable to the Board. All
functions of the board are not public functions nor ate they closely related to
governmental functions.
6. The Board is not created by transfer of a governement owened corporation. It
is an autonomous body.
 Zee Telefilms Ltd. v. Union of India, (2005) 4 SCC 649
Minority Opinion (S.B. Sinha, J.)

195. In our view, the complex problem has to be resolved keeping in view the following
further tests :
i) When the body acts as a public authority and has a public duty to perform;
(ii) When it is bound to protect human rights.
(iii) When it regulates a profession or vocation of a citizen which is otherwise a
fundamental right under a statute or its own rule.
(iv) When it regulates the right of a citizen contained in Article 19(1)(a) of the Constitution
of India available to the general public and viewers of game of cricket in
particular.
(v) When it exercises a de facto or a de jure monopoly
(vi) When the State out-sources its legislative power in its favour ;
(vii) When it has a positive obligation of public nature.

196. These tests as such had not been considered independently in any other decision of
this Court. it exercises a de facto or a de jure monopoly;
Other Cases

• Balmer Lawrie & Co. Ltd v. Partha Sarathi Sen Roy, decided on 20
Februiary 2013
• Board of Control for Cricket in India v. Cricket Association of Bihar and
Ors. (2015)3SCC251
• Sanjaya Bahel v. Union of India decided on 15 May, 2019,
– Delhi High Court held that the United Nations is not a "State" within the meaning
of Article 12 of the Constitution of India and is not amenable to the jurisdiction
of the Court under Article 226 of the Constitution of India. The court says, by no
stretch of the imagination an organisation of the United Nations which is an
international body be treated as "instrumentality" and or an "agency" of the
Government."
Law Commission of India Report
One Hundred Forty-Fifth Report on Article 12 of the Constitution and Public Sector Undertakings
 USA
• The concept of state action
• ‘No definition in USA Constitution
• American Supreme Court has enlarged the concept of ‘State Action’ as far as possible.
• Reid v. Convert, (1958)354 us1(17)
• “The amendments embodying the bill of rights were intended to curb all branches of
the federal government in the fields touched by the amendments-legislative, executive
and judicial.
• Ex parte Virginia, (1880) 100 us 339 (347)
• “A state acts by its legislative, its executive, of its judicial authorities. It can act in no
other way. The constitutional provision (14ht amendment), therefore, must mean that
no agency of the state, or of the officers or agents by whom its powers are exerted,
shall deny to any person within its jurisdiction the equal protection of the laws.
Whoever, by virtue of a public position under a state government….. Denies or takes
away the equal protection of the laws, violates the constitutional inhibition; and as he
acts in the name of and for the state, and is clothed with the state’s power, his act is
that of the state’.
 Cases Related to Co-operative Societies
• Thalappalam Ser. Coop. Bank Ltd. V. State of Kerala and others October 07,
2013 [2]
We have, on facts, found that the Co-operative Societies, with which we are
concerned in these appeals, will not fall within the expression “State” or
“instrumentalities of the State” within the meaning of Article 12 of the
Constitution and hence not subject to all constitutional limitations as enshrined
in Part III of the Constitution.
• U.P. State Co-operative Land Development Bank Limited v. Chandra
Bhan Dubey and others (1999) 1 SCC 741
While dealing with the question of the maintainability of the writ petition against
the U.P. State Cooperative Development Bank Limited held the same as an
instrumentality of the State and an authority mentioned in Article 12 of the
Constitution.
S.S. Rana v. Registrar, Cooperative Societies and another (2006) 11 SCC
634
Kangra Central Co-operative Society Bank Limited, a society registered under
the provisions of the Himachal Pradesh Co-operative Societies Act, 1968- Not a
state