Very important point
Whereas majority of 5 Judges held that Council of Scientific and Industrial Research is a State within the meaning of Article 12 of the Constitution and overruled Sabhajit Tewary v. U.O.I. 1975(3) SCR 616 which was also a 5 Judge contrary decision, but minority of 2 Judges held that CSIR is not the State within the meaning of Article 12 of the Constitution and Sabhajit Tewary’s case was correctly decided and must hold the field. The matter is remitted to appropriate Bench to be dealt with in the light of this decision.

Headnote:(i) Constitution of India—Articles 12, 14 and 32—In 1972, Sabhajit Tewary, A Junior Stenographer with the Council of Scientific and Industrial Research (CSIR) filed a writ petition under Article 32 claiming parity of remuneration with the stenographers who were newly recruited to the CSIR—His claim was based on Article 14 of the Constitution which strikes at arbitrariness in State action and ensure fairness and equality of treatment—A Constitution Bench of 5 Judges in Sabhajit Tiwary v. U.O.I., 1975(3) SCR 616 held that the writ petition was not maintainable against CSIR as it was not an “authority” within the meaning of Article 12 of the Constitution—The correctness of the decision is referred to a large Bench of 7 Judges—Is the CSIR a State within the meaning of Article 12 of the Constitution? (Yes by Majority of 5 : 2)—Should the Court overrule Sabhajit Tewary which has stood for over a quarter of century? (Yes, by Majority of 5 : 2)—Case law discussed.
       Held : (Per Majority of 5 Judges) : 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 anyone 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. Coming now to the facts relating to CSIR, we have no doubt that it is well within the range of Article 12, a conclusion which is sustainable when judged according to the tests judicially evolved for the purpose. (Paras 41 and 42)
       Had the facts been closely scrutinised in the proper perspective, it could have led and can only lead to the conclusion that CSIR is a State within the meaning of Article 12. (Para 61)
       Besides a new fact relating to CSIR has come to light since the decision in Sabhajit Tewary which unequivocally vindicates the conclusion reached by us and fortifies us in delivering the coup de grace to the already attenuated decision in Sabhajit Tewary. (Para 63)
       The notification issued in 1986 by the Central Government under Article 14(2) of the Administrative Tribunals Act, 1985 serves in removing any residual doubt as to the nature of CSIR and decisively concludes the issues before us against it. (Para 66)
       Held consequently : Sabhajit Tewary’s decision must be and is in the circumstances overruled. (Para 67)
       But held (Per Minority of 2 Judges) : We have had the advantage of reading the judgment proposed by our learned sister Ruma Pal, J., With greatest respect to her, we find ourselves not persuaded to subscribe to her view overruling Sabhajit Tewary’s case and holding Council for Scientific and Industrial Research (CSIR) ‘the State’ within the meaning of Article 12 of the Constitution. The development of law has travelled through apparently a zig-zag track of judicial pronouncements, rhythmically traced by Ruma Pal, J. in her judgment. Of necessity, we shall have to retread the track, for, we find that though the fundamentals and basic principles for determining whether a particular body is ‘the State’ or not may substantially remain the same but we differ in distributing the emphasis within the principles in their applicability to the facts found. We also feel that a distinction has to be borne in mind between an instrumentality or agency of ‘the State’ and an authority includible in ‘other authorities’. The distinction cannot be obliterated. (Para 68)
       Applying the tests formulated hereinabove, we are clearly of the opinion that CSIR is not an ‘authority’ so as to fall within the meaning of expression ‘other authorities’ under Article 12. It has no statutory flavour - neither it owes its birth to a statute nor is there any other statute conferring it with such powers as would enable it being branded an authority. The indicia of power is absent. It does not discharge such functions as are governmental or closely associated therewith or being fundamental to the life of the people. (Para 100)
       Consequently held : For the foregoing reasons, we are of the opinion that Council for Scientific and Industrial Research (CSIR) is not the State within the meaning of Article 12 of the Constitution. Sabhajit Tewary’s case was correctly decided and must hold the field. (Para 105)
       (ii) Constitution of India—Article 136—Appeal by Special leave—Writ application filed by the appellants in Calcutta High Court challenging the termination of their service by respondent No. 1 which is a unit of CSIR—They prayed for an interim order before the learned Single Judge—Following Sabhajit Tewary’s case it was refused as writ application itself was not maintainable against respondent No. 1 who was not an “authority” within the meaning of Article 12—Appeal to Supreme Court by Special leave—Matter referred to a larger Bench of 7 Judges—Answered by majority of 5 Judges overruling Sabhajit Tewary’s case but minority of 2 Judges upheld that case—Matter remitted to appropriate Bench for decision of appeal by Majority but minority dismissed the appeal—Case remanded to appropriate Bench accordingly.
       Held (Per Majority) : Sabhajit Tewary’s decision must be and is in the circumstances overruled. Accordingly the matter is remitted back to the appropriate Bench to be dealt with in the light of our decision. There will be no order as to costs. (Para 67)
       Held (Per Minority) : For the foregoing reasons, we are of the opinion that Council for Scientific and Industrial Research (CSIR) is not the State within the meaning of Article 12 of the Constitution. Sabhajit Tewary’s case was correctly decided and must hold the field. The High Court has rightly followed the decision of this Court in Sabhajit Tewary. The appeal is liable to be dismissed. (Para 105)

Judgement Key Points

Certainly. Based on the provided legal document, the following key points can be summarized:

The legal interpretation of whether an entity qualifies as a 'State' under Article 12 of the Constitution hinges on whether it is an instrumentality, agency, or authority of the government (!) (!) .
An entity is considered an 'authority' if it is created by a statute or functions under statutory powers that confer upon it the capacity to make binding decisions or issue directives with legal consequences (!) (!) .
The determination of whether an entity is an 'instrumentality or agency' of the State involves examining factors such as ownership, control, financial support, and the nature of functions performed. A body with deep, pervasive control and substantial financial backing from the government is more likely to be classified as an instrumentality or agency (!) (!) .
The tests for establishing whether a body is an 'instrumentality or agency' are not rigid; rather, they require a cumulative assessment of relevant factors, including financial dependence, administrative control, and the nature of functions (!) (!) .
Merely receiving government funding or having some government participation does not automatically make an entity a 'State'. The control must be deep and pervasive, and the entity must perform functions of governmental importance or be closely related to governmental activities (!) (!) .
An entity that is organized as a registered society or a corporation is not automatically excluded from being a 'State'. The true test involves examining the extent of government control, ownership, and whether the entity acts as a surrogate or instrumentality of the government (!) (!) .
The distinction between 'instrumentality or agency' and 'authority' is significant; an authority must be an independent legal entity with statutory powers, while an instrumentality or agency is typically a body through which the government acts (!) (!) .
The legal and constitutional framework emphasizes that the expansion of the concept of 'State' is meant to ensure that bodies performing public functions or exercising governmental powers are subject to constitutional limitations and fundamental rights protections (!) (!) .
The presence of government control, funding, or influence alone does not suffice; the nature of the functions, the degree of control, and the legal powers conferred are critical in determining the status of an entity as a 'State' (!) (!) .
Ultimately, each case requires a factual and holistic assessment of the entity's structure, control, functions, and funding to determine whether it constitutes part of the 'State' within the meaning of Article 12 (!) (!) .

Please let me know if you need further elaboration or specific legal guidance on any of these points.

JUDGMENT

Ruma Pal, J. (For herself and on behalf of CJI, Syed Shah Mohammed Quadri, N. Santosh Hegde, Arijit Pasayat, JJ.)—

In 1972 Sabhajit Tewary, a Junior Stenographer with the Council of Scientific and Industrial Research (CSIR) filed a writ petition under Article 32 of the Constitution claiming parity of remuneration with the stenographers who were newly recruited to the CSIR. His claim was based on Article 14 of the Constitution. A Bench of five judges of this Court denied him the benefit of that Article because they held in Sabhajit Tewary v. Union of India1 that the writ application was not maintainable against CSIR as it was not an ‘‘authority” within the meaning of Article 12 of the Constitution. The correctness of the decision is before us for re-consideration.

2. The immediate cause for such re-consideration is a writ application filed by the appellants in the Calcutta High Court challenging the termination of their services by the respondent No. 1 which is a unit of CSIR. They prayed for an interim order before the learned Single Judge. That was refused by the Court on the prima view that the writ application was itself not maintainable against the respondent No. 1. The appeal was also dismissed in view of the decision of this Court in Sabhajit Tewary’s case2.

3. Challenging the order of the Calcutta High Court, the appellants filed an appeal by way of special leave before this Court. On 5th August, 1986 a Bench of two Judges of this Court referred the matter to a Constitution Bench being of the view that the decision in Sabhajit Tewary required re-consideration ‘‘having regard to the pronouncement of this Court in several subsequent decisions in respect of several other institutes of similar nature set up by the Union of India”.

4. The questions therefore before us are - is the CSIR a State within the meaning of Article 12 of the Constitution and if it is should this Court reverse a decision which has stood for over a quarter of a century?

5. The Constitution has to an extent defined the word ‘State’ in Article 12 itself as including :

‘‘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 Government of India.”

6. That an ‘inclusive’ definition is generally not exhaustive is a statement of the obvious and as far as Article 12 is concerned, has been so held by this Court3. The words ‘State’ and ‘Authority’ used in Article 12 therefore remain, to use the words of Cardozo4, among ‘‘the great generalities of the Constitution” the content of which has been and continues to be supplied by Courts from time to time.

7. It would be a practical impossibility and an unnecessary exercise to note each of the multitude of decisions on the point. It is enough for our present purposes to merely note that the decisions may be categorized broadly into those which express a narrow and those that express a more liberal view and to consider some decisions of this Court as illustrative of this apparent divergence. In the ultimate analysis the difference may perhaps be attributable to different stages in the history of the development of the law by judicial decisions on the subject.

8. But before considering the decisions it must be emphasized that the significance of Article 12 lies in the fact that it occurs in Part III of the Constitution which deals with fundamental rights. The various Articles in Part-III have placed responsibilities and obligations on the ‘State’ viz-a-viz the individual to ensure constitutional protection of the individual’s rights against the State, including the right to equality under Article 14 and equality of opportunity in matters of public employment under Article 16 and most importantly the right to enforce all or any of these fundamental rights against the ‘State’ as defined in Article 12 either under Article 32 by this Court or under Article 226 by the High Courts b

Click Here to Read the rest of this document

2002 Supreme(SC) 503

Cases Referred (28)

Related Judgments

Plastikos Packaging VS Commissioner of Central Excise, Allahabad

SYSTEMS MANUFACTURING LTD VS SYSTEMS EMPLOYEES ASSOCIATION - 2000 Supreme(Kar) 665

JOGENDRA SINGH VS SURESH MANJULAPUR - 2000 Supreme(Kar) 662

MYSORE WINE PRODUCTS AND ALLIED CO. LTD. , BANGALORE VS PRESIDING OFFICER, INDUSTRIAL TRIBUNAL, BANGALORE - 2000 Supreme(Kar) 663

Bose VS State, rep. by Inspector of Police, Salaikiramam P. S. , - 2000 Supreme(Mad) 1273

Jain Construction Company VS State of Rajasthan - 2000 Supreme(Raj) 912

Voltas Limited VS Joint Collector, Medak - 2000 Supreme(AP) 945

STATE OF BIHAR VS SURENDRA SINGH RAUTELA ALIAS BENGALI - 2000 Supreme(Jhk) 45

Krishna Kumar VS Gulab Khan - 2000 Supreme(Raj) 1546

KARSANBHAI DAHYABHAI PARMAR VS DISTRICT SUPERINTENDENT OF POLICE - 2000 Supreme(Guj) 1009