High Court Of Jharkhand
Judgename : P. K. BALASUBRAMANYAN, R. K. MERATHIA
RAJNISH MISHRA - Appellant
Versus
STATE OF JHARKHAND - Respondents
W. P. (P. I. L.) 3510 Of 2002
Decided On : 11/21/2003
Public Funds - Creation of Boards, Corporations and Companies - Article 21, Article 148, Comptroller and Auditor-General - [SUMMARY]
Fact of the Case:
The petitioner sought to restrain the State of Jharkhand from forming unnecessary corporations and companies, alleging that they were created for patronage and nepotism, leading to wasteful expenditure of public funds. The State contended that the petition was not maintainable and that the court cannot interfere in matters of policy.
Finding of the Court:
The court held that it has the jurisdiction to prevent wasteful expenditure and ensure proper use of public funds. It accepted the State's assurance to create corporations only when necessary, but allowed citizens to challenge specific creations based on relevant facts.
Issues: The main issue was whether the court could intervene in the creation of boards, corporations, and companies by the State government, and whether such creations were necessary and in the public interest.
Ratio Decidendi: The court found that it has the authority to prevent wasteful expenditure and ensure proper use of public funds. It emphasized the obligation of the government to consider the necessity of creating such bodies and to appoint qualified individuals to lead them.
Final Decision: The court disposed of the writ petition, accepting the State's undertakings and directing the government to create corporations or government companies only if absolutely necessary, while allowing citizens to challenge specific creations based on relevant facts.
P. K. BALASUBRAMANYAN, C. J.
( 1 ) THE basic prayer in this writ petition is to restrain the State of Jharkhand from frittering away public funds by forming unnecessary, corporations and companies for taking up welfare projects when the same could be got done by the existing arrangements through the concerned departments and ministries. The petitioner, a practising lawyer, submits that corporations are created and companies are incorporated just to accommodate some persons or by way of distribution of patronage and such exercise is not warranted as it is against public interest and common good. The prayer is couched as one for the issue of a writ of mandamus directing the State Government to justify before this Court the constitution of boards, authorities and the like bodies with reference to the need for their constitution and the expenditure that was involved in maintaining such bodies. According to the petitioner, these boards, corporations and companies tend to become white elephants, merely eating away the wealth of the State without bringing any benefit to the people of the State or a section of it for whose benefit allegedly they are constituted. They benefit only those who are accommodated in them.
( 2 ) ACCORDING to the petitioner, all boards, corporations and companies are created and appointments of Chairmen and members are resorted to, just to accommodate the followers and supporters who are really not qualified and have no experience in the concerned field and that the exercise so undertaken is a fraud on power and on the Constitution. It is contended that a State, like the newly created State of Jharkhand, can ill-afford such wasteful expenditure. The question, therefore, arises whether the creation of these bodies are really necessary and whether it does not amount to casting an unnecessary burden on the State exchequer rendering the creation vulnerable to challenge as being arbitrary and unreasonable. A right to a well managed economy may even come within the concept of the right to life under Article 21 of the Constitution and, hence it is not as if the Court cannot control the exercise of power for creation of such unnecessary bodies or to present the wasteful expenditure resulting from it. The petitioner asserts that such bodies serve no useful purpose and exhorts the Court to prevent such wasteful expenditure.
( 3 ) ACCORDING to the State, Boards Corporations and Companies are created formed or incorporated, only for the purpose of achieving the social uplift of the people and there is no question of any distribution of patronage or practice of nepotism involved. It is also submitted that a writ petition of this nature is not maintainable and the court cannot decide whether a particular body constituted by the State Government was necessary or not. It was a matter of policy. In any event such a general challenge was not tenable. Of course the Court may be able to direct the State Government to ensure that there is no wasteful expenditure. The Court may even scrutinize the decision to form a particular Corporation in the background of the facts leading to the formation of that body, but there cannot be some sort of a pre-emptive general writ relating to the creation of such bodies. Ultimately, it was a matter of policy for the Government. In the guise of entertaining a public interest litigation, the Court cannot control the functioning of the Government or the actions of the Executive taken according to its conception of necessity and public interest. Thus, the writ petition with the prayer in the manner in which it is made, was not maintainable.
( 4 ) OF course, pending the writ petition, certain interim directions had been issued permitting the creation of some bodies or corporations and a few applications by the state seeking permission to create other bodies are also pending. It was in that context that the learned Advocate General submitted that the case itself must be heard and decided fin
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