The main legal point established in the judgment is the obligation of the State Government to provide funds for the Agency to maintain its establishment and discharge its welfare functions.

1. Heard learned counsel for the petitioners, the State and the counsel for the Gandak Area Development Agency (hereinafter referred to as the Agency).

2. Petitioners in the two writ applications are the employees of the Agency. They have filed the two writ applications praying inter alia to direct the State respondents and its officers as also the Executive Committee of the Agency to enforce the service conditions in the matters of pay revision, leave encashment, group insurance and payment of gratuity in terms of the Payment of Gratuity Act, 1972 as is applicable to the employees of the State Government in the light of the decision of the Executive Committee of the Agency taken in its meeting held on 29.6.1999 vide agenda item No. 13 and notified under office order No. 985 dated 10.8.1999, Annexure-3.

3. It is submitted on behalf of the petitioners that the State Government being conscious of the fact that Bihar is a State which is primarily dependent on agriculture and in order to improve and enhance the agricultural production it is necessary to modernize and develop the irrigation system to provide maximum irrigation facility to the lands falling within the span/command area of the three rivers, namely, Koshi, Gandak, and Sone resolved to constitute the three command area development authority for the better management of the three rivers under resolution of the State Government dated 20.10.1973. Perusal of the said notification indicates that Koshi Command Area Development Authority was constituted for the district(s) of Purnia, Katihar, Saharsa, Gandak Area Development Authority for the district(s) of East and West Champaran, Siwan, Saran, Gopalganj, Vaishali, Samastipur and Muzaffarpur and Sone Area Development Authority for the district(s) of Rohtas, Bhojpur, Patna, Aurangabad and Gaya.

4. It is further submitted that in the second meeting of the Sone Area Development Authority held on 7.2.1974 presided over by the Chief Secretary and other senior officers of the state it was resolved vide agenda item No. 4 to apply to the employees of the Authority the Bihar Service Code, TA Rules, GP Fund Rules, Financial Rules, Treasury Rules, Treasury Code, Pension Rules, the Board Miscellaneous Rules, the proceeding dated 7.2.1974 has been annexed as Annexure-11 to I.A. No. 8187 of 2009 filed in C.W.J.C. No. 9446 of 2009. Later Bihar Agricultural and Rural Area Development Agency Ordinance, 1974 was promulgated, under Section 3 whereof the State Government constituted Koshi Area Development Agency for the district(s) of Purnia, Katihar, Saharsa, Gandak Area Development Agency for the district(s) of East and West Champaran, Siwan, Saran, Gopalganj, Vaishali, Samastipur and Muzaffarpur and Sone Area Development Agency for the district(s) of Rohtas, Bhojpur, Patna, Aurangabad and Gaya. The ordinance was ultimately replaced by the Bihar Agricultural and Rural Area Development Agency Act, 1978 (hereinafter referred to as the Act), the three agency after coming into force of the Act are functioning and discharging their duties in terms of the provisions of the Act.

5. With reference to the provisions of the Act it is submitted by the counsel for the petitioners that the three agency having been constituted under Section 3 of the Act are body corporate having perpetual succession and common seal with powers to acquire, hold, dispose of property and to contract and it may sue or be sued in its own name and the Agency is discharging the responsibilities of the State as it is undertaking execution of the scheme for securing integrated rural and agricultural development of the area by modernizing the irrigation and water drainage system so as to realize the maximum potentiality of the river waters of the three rivers for the benefit of the integrated development of the area falling within the area of operation of the three Agency.

6. With reference to Section 4 of the Act it is submitted that the administrative control of the Agenc