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HIGH COURT OF CALCUTTA
D. Basu
KARTICK CHANDRA NANDI - Appellant
Versus
WEST BENGAL SMALL INDUSTRIES CORPORATION LTD. - Respondent
C. O. 2518 (W) Of 1966
Decided On : SEPTEMBER 27, 1966
WRIT OF MANDAMUS - DISTRIBUTION OF CHANKS - PUBLIC DUTY - COMPANY REGISTERED UNDER COMPANIES ACT - ARTICLE 14 OF THE CONSTITUTION - ARTICLE 226 OF THE CONSTITUTION - LEGAL RIGHT - PUBLIC DUTY - PRIVATE RIGHT - STATUTORY DUTY - NON-STATUTORY SCHEME - MEMORANDUM OF ASSOCIATION - EQUITABLE DISTRIBUTION - GOVERNMENT CONTROL - PUBLIC CORPORATION - ABUSE OF POWERS - LEGISLATIVE CONTROL - PETITION DISMISSED.
Fact of the Case:
The Petitioner, representing a Co-operative Society of conch-shell artisans, challenged the order of the Managing Director of the West Bengal Small Industries Corporation Ltd. (Respondent), which allocated all the available chanks to only three out of 24 Co-operative Societies. The Petitioner claimed an equitable distribution of chanks, alleging a violation of Article 14 of the Constitution and the public duty of the Corporation.
Finding of the Court:
The Court held that the Corporation, being a company registered under the Companies Act, was not a 'state' within the meaning of Article 12 of the Constitution and, therefore, the Petitioner's challenge under Article 14 failed. The Court further held that a writ of mandamus under Article 226 could not be issued against the Corporation as it was not performing any public duty and the Petitioner had not established any legal right to enforce such a duty.
Issues: 1. Whether the Corporation, being a company registered under the Companies Act, could be considered a 'state' within the meaning of Article 12 of the Constitution? 2. Whether the Petitioner had a legal right to enforce an equitable distribution of chanks by the Corporation? 3. Whether the Corporation had a public duty to distribute chanks equitably?
Ratio Decidendi: 1. The Court held that the Corporation, being a company registered under the Companies Act, was not a 'state' within the meaning of Article 12 of the Constitution. The Court reasoned that the definition of 'state' in Article 12 includes only those entities that exercise governmental or legislative powers, and the Corporation, being a private company, did not fall within this definition. 2. The Court held that the Petitioner did not have a legal right to enforce an equitable distribution of chanks by the Corporation. The Court reasoned that the Corporation was not performing any public duty and that the Petitioner had not established any legal right to enforce such a duty. 3. The Court held that the Corporation did not have a public duty to distribute chanks equitably. The Court reasoned that the Corporation was a private company and that its Memorandum of Association did not impose any such duty.
Final Decision: The Court dismissed the Petitioner's petition under Article 226, holding that the Corporation was not a 'state' within the meaning of Article 12 of the Constitution, that the Petitioner did not have a legal right to enforce an equitable distribution of chanks by the Corporation, and that the Corporation did not have a public duty to distribute chanks equitably.
( 2 ) THE Petitioner is a member, along with a number of other conch-shell artisans, of the Sribara Co-operative Sankha Silpi Society Ltd. , and his case is that this Co-operative Society has a right "to get an equitable distribution of Chanks" from the Corporation. This alleged right is founded in this way: Chanks are grown only in the States of Madras and Ceylon. In order to ensure a supply of these chanks to artisans of West Bengal, the Government of West Bengal, in 1956, formulated a scheme through its Directorate of Industries, for the purchase of chanks from Madras and Ceylon and then to distribute them to the artisans through the Cooperative Societies. In June, 1961, the Scheme, with its staff, was transferred to the West Bengal Industries Corporation Ltd. , which describes itself as a Government of West Bengal Undertaking. It is further stated in the Petition that though the Corporation is a company registered under the Companies Act, its shares are confined to the Government or its nominees and its Articles of Association expressly declare that "no invitation shall be issued to the public to subscribe any shares or stock or debentures stock of the Company. "
( 3 ) THE Government of Madras has recently allotted chanks worth Rs. 6. 75 lakhs to the Corporation but by the impugned order, the Managing Director has allotted all these chanks to only three out of the 24 Chank Co-operative Societies of West Bengal. But by the same order (Ann. B), the Corporation has intimated the Society to which the Petitioner belongs that another consignment of chanks is being expected from Tuticorin for the supply from which stock the Petitioner's Society may apply :"we have already requested the Government of Madras to make available to us further quantities of Tutieorin chanks valued approximately at Rs. 7. 5 lakhs. In case a society or a group of societies agree to execute the necessary agreement with this Corporation for purchase of the aforesaid quantity of chanks they may contact the undersigned. "
( 4 ) NOT satisfied with any such assurance, the Petitioner has brought this Petition under Article 226, complaining of an infringement of the duty of the Corporation to distribute the chunks equitably amongst all the Co-operative Societies, as listed in Ann. A. The favourable treatment of only three Societies by the impugned order is alleged to be in violation of the public duty of the Corporation to effect equitable distribution of the chanks and of the guarantee of equal protection in Article 14 of the Constitution.
( 5 ) WITHOUT issuing a Rule in the first instance, I directed the Petitioner to move the petition after notice to the Opposite Parties, The Corporation and its Managing Director have appeared and opposed the Petition by a counter-affidavit.
( 6 ) THE Respondent contends that the Petition must be dismissed since the Petitioner has failed to make out any legal right of the Petitioner to enforce an equal distribution of the ohanks by the Respondent or any corresponding legal duty on the part of the respondent which is a company registered under the Companies Act, and as such a legal entity separate from the State and has no statutory obligations in the matter of distribution of the chanks, which it is carrying on commercial terms with those who agree to accept those terms.
( 7 ) THE question to be determined in this petition is one of law, namely, whether a writ of mandamus is available against a
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