Article 12 The State Under Indian Constitution

Purpose of Defining “The State” Under Article 12

• In modern era “State” is the most powerful authority within any Country as it can make laws, repeal laws, amend laws and implement laws.
• On the other hand, if any powers remains unfettered it may lead to its abuse
• So in order to put restrain on an unlimited powers of the State, our Constitution has assured Fundamental Rights to its citizens under Part III (Article 12 to Article 35) which is a limitation on powers of the State.
• State cannot violate fundamental rights granted to people. In case it violates any of the fundamental rights, people have remedy against it under Article 32 and Article 226 of the constitution.
• Therefore, Article 12 has been provided upfront to determine what entities fall within the term State.

Article 12 States That “The State” Includes :

• Government and Parliament of India i.e the Executive and Legislature of the Union
• Government and Legislature of each State i.e the Executive and Legislature of the various States of India
• All local or other authorities within the territory of India or under the control of the Government of India
• Definition of term “State” under Article 12 is not a universal It is applicable only to Part III and Part IV of the Constitution.

Local Authority

• “Authority” means a person or body exercising power to
• Local authority has been defined in Section 3(31) of the General Clauses Act, 1897 as follows :

“Local Authority shall mean a municipal committee, district board, body of commissioner or other authority legally entitled to or entrusted by the Government within the control or management of a municipal or local fund.”

Test to Determine Local Authorities

In Mohammad Yasin v. Town Area Committee (1952), the Supreme Court held that to be characterized as a ‘local authority’ the authority concerned must fulfill the following test:

1. Have a Separate Legal Existence as a Corporate Body
2. Not be a mere government agency but must be legally an independent entity
3. Function in a defined area
4. Be wholly or partly, directly or indirectly, elected by the inhabitants of the area
5. Enjoy a certain degree of autonomy (complete or partial)
6. Be entrusted by statute with such governmental functions and duties as are usually entrusted to locally (like health, education, water, town planning, markets, transportation, etc.)
7. Have the power to raise funds for the furtherance of its activities and fulfilment of its objectives by levying taxes, rates, charges or fees.
8. Similar observation as aforesaid was also made in RC Jain v UOI (1981).
9. Ajit Singh v State of Punjab - Within the meaning of the term local authority, village panchayat is also included.

Other Authorities

The Chairman of the Drafting Committee (Dr. B.R Ambedkar) clarified that ‘other authorities’ would refer to those that had ‘the power to make laws or the power to have discretion vested in it’. However, he stated that it would be cumbersome to list the various institutions which will fall within the term “other authorities” and left it for future interpretation of the Court.

Therefore we can say that framers of the Constitution had it in their mind that in future the role of State will get widened and State will perform various function through other agencies receiving its patronage. So in order to ensure those authorities also fall within the definition of State, the term “other authorities” was included.

Supreme Court’s Interpretation of the Term “Other Authorities”

University of Madras v Santa bai (1953)

The Court held that 'other authorities' could only indicate authorities of like nature, i.e., ejusdem generis. So construed it could only mean authorities exercising governmental or sovereign functions.

It cannot include persons, natural or juristic, such as, a University unless it is ‘maintained by the State’.

Ujjamabai v State of UP (1961)

The court rejected the above restrictive scope and held that the ‘ejusdem generis’ rule could not be resorted to the in interpreting ‘other authorities’. The bodies named under Article 12 have no common genus running through them and they cannot be placed in one single category on any rational basis.

State Electricity Board, Rajasthan v Mohanlal (1967)

The Supreme Court held that ‘other authorities’ would include all authorities created by the constitution or statute on whom powers are conferred by law. Such statutory authority need not be engaged in performing government or sovereign functions.

The court emphasized that it is immaterial that the power conferred on the body is of a commercial nature or not because under Article 298 the government is empowered to carry on any trade or commerce.

Sukhdev Singh v Bhagatram (1975)

Following the test laid down in State Electricity Board, Rajasthan v Mohanlal, held that ONGC, LIC and Indian Financial Corporation are authorities with the meaning of term “State” under Article 12 as they have power to make regulations under the Statute for regulating conditions of service of their employees.

Furthermore, Justice Mathew suggested a broader test to determine what constitutes “other authorities”. He stated that if the function of any corporation are of public importance and closely related to governmental function then it should be treated as agency or instrumentality of government and should be consider as “State” under Article 12.

D. Shetty v Airport Authority of India (1979)

SC clearly specified that corporations acting as instrumentality or agency of government would fall within “other authorities” under Article 12 and hence will be considered as “State” if their act infringes fundamental rights of any person.

If government acting through its officers is subject to certain constitutional limits, it must follow a fortiori, that government acting through the instrumentality or agency of corporations should equally be subject to same limitations.

Test to Determine Instrumentality or Agency of the State

In RD Shetty v International Airport Authority, Justice PN Bhagwati laid down following tests to determine whether a body/corporation is agency or instrumentality of the State or not:

1. Entire share capital of the corporation/body is held by the State.
2. Such body/corporation  have  a  governmental  functional  character(example: discharging public services etc.).
3. Existence of deep and pervasive control of the government.
4. Any department of government is transferred to such body/corporation.
5. The corporation/body is enjoying monopoly status which is conferred by State

Other Important Cases Pertaining to Article 12

Sabhajit Tiwar v UOI (1975) -

The court in this case observed that the bodies who are not incorporated through a statue and are registered under the Companies Act 1956 and the Societies Registration Act 1860 are not considered to be a state under Article 12 of the Constitution. These could not be held to be departments of government. Therefore Council of Scientific and Industrial Research (CSIR) was considered not to be State under Article 12.

Som Prakash vs. Union of India (1980) -

The Court held that a government company BHARAT PETROLEUM fell within the meaning of expression the State used in Article 12. The Court held that the expression other authorities comprises of all statutory authorities on whom powers are conferred for carrying commercial activities. It was also held that the expression other authorities are not confined to statutory corporation also include a government company, a registered society or bodies which have some nexus and interrelation with the government.

Ajay Hasia v Khalid Mujib (1980) –

The SC applied the test of instrumentality and agency as laid down in RD Shetty v International Airport Authority of India and held that societies registered under the Societies Registration Act, 1898 (in this case, Regional Engineering College in Srinagar) is an agency of Government as the government had a deep control over its functioning as its composition was determined by the representatives of government, the society is to comply with direction of the government.

The Court observed that “the test is not how a juristic person is created rather why it has been brought into existence”. A Corporation maybe a statuary corporation or a government body formed under the Companies Act or a society registered under the Societies Registration Act , it would be an authority under Article 12 if it is an instrumentality or Agency of Government.

BS Minhas v Indian Statistical Institute(1983) –

The Court held that Indian Statistical Institute which was a society registered under the Societies Registration Act and was functioning completely under the control of government and hence was considered as State under Article 12.

Pradeep Kumar Biswas v Indian Institute of Chemical Biology (2002) –

The SC overruled the Sabhajit Tiwary’s case and held that Council of Scientific and Industrial Research (CSIR) is a State within Article 12.

The Workman v Food Corporation of India (1985) –

Food Corporation of India (FCI) was considered to be an instrumentality or agency of the government and was considered as State under Article 12.

Chander Mohan Khanna v NCERT(1991) –

The Court observed that NCERT is a Society registered under the Societies Registration Act but is an autonomous body ; its activities are not wholly related to government functions and is not funded entirely by government sources. Hence, it is not a State.

Bank of India v U.P. Swarnakar (2002) – All the nationalized banks were considered to be State within the meaning of Article 12.

Zee Telefilms v UOI (2005) – The Court observed that BCCI is not created by a statute neither dominated by the government financially, functionally or administratively and hence was considered not to be agency or instrumentality of the State.

Is Judiciary a State under Article 12?

The Judiciary is not expressly mentioned in Article 12 and a great amount of dissenting opinions exist that whether it is to be considered as a State or not.

Supreme Court’s observations :

• Prem Garg v/s Excise Commissioner H.P. - The Supreme Court held that when rule making power of judiciary is concerned, it is State.
• Naresh Sridhar Mirajkar v State of Maharashtra - What a judicial decision purports to do is decide the controversy between parties and nothing more. The court noted that Judiciary, while exercising its rule-making power under Article 145, would be covered by the expression ‘State’ covered by the expression State within the meaning of Article 12. But, while performing its judicial decisions, it is not to be considered as a State.
• Rupa Hurra v Ashok Hurra - Court reaffirmed and ruled that no judicial proceeding could be said to violate any of the Fundamental rights and that it is a settled position of law that superior courts of justice did not fall within the ambit of ‘state’ or ‘other authorities’ under Article 12. Therefore, it can rightly be said that while courts perform their administrative function, they are within the State’s definition and cannot violate any fundamental rights of the citizen. Still, when they give judicial decisions, they do not come within the meaning of State.
• Similar observations were also made in R.Antulay v RS Nayak and Riju Prasad Sharma v State of Assam.
• So, it can be concluded that the position of Judiciary concerning Article 12 depends upon its judicial and non-judicial decisions wherein if the Judiciary is deciding cases it cannot be brought under the expression state while performing its non-judicial functions they are included within the definition of State.

 

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