J. K. MATHUR, J. ( 1 ) THIS is a petition under Article 226 of the Constitution seeking a mandamus to command the respondents not to deduct any amount from the salary of the petitioner excepting the instalments agreed. ( 2 ) THE petitioner is an employee in the Indian Oil Corporation and was working as a technician in the Maintenance Department in Haldia Oil Refinery. He asked for and was sanctioned house building loan. It is not disputed that he did not raise any construction. There was an agreement in writing under the terms of which in case of non-utilisation of loan the entire amount was recoverable while in case of utilisation only instalments amounting to Rs. 2113/- per month were to be deducted from the petitioner's salary. The opposite parly however, started deducting larger amounts so that in the month of September, he was paid a salary of Rs. 5/- only. Aggrieved by this, he has come to the Court. ( 3 ) INTERIM Order was passed by this Court by which only Rs. 2113/- were permitted to be deducted from the salary in respect of the house building advance. ( 4 ) THE respondent moved an application for vacating this interim order. With the consent of the parties that application was treated as affidavit-in opposition and the matter heard finally. It was also stated by the Ld. Counsel for the respondents that the facts not specifically disputed in the application for vacating stay order were all denied. ( 5 ) ON behalf of the respondents a preliminary objection was taken that this petition was not maintainable. As pointed out above it is not disputed between the parties that the loan was sanctioned to the petitioner and an agreement was executed. Copy of the agreement has been filed with the affidavit-inreply as Annexure-A. The relevant clauses are terms C and h (iii ). The former stipulates that the amount would be recoverable in monthly instalments of Rs. 2113/- and would be deducted from the salary. Clause-h (iii), stipulates that in the event of non-utilisation the entire amount shall become repayable immediately and if not paid, and the loans would be liable to interest at 1% above the Corporation Borrowing Rate. The other consequences are also mentioned which are not relevant in this discussion.
2113/- and would be deducted from the salary. Clause-h (iii), stipulates that in the event of non-utilisation the entire amount shall become repayable immediately and if not paid, and the loans would be liable to interest at 1% above the Corporation Borrowing Rate. The other consequences are also mentioned which are not relevant in this discussion. ( 6 ) IT has been argued that the recovery of the amount is in pursuance of contract between the parties and therefore, it cannot be challenged in writ petition. It was urged that the mandamus cannot be issued to protect a private right and therefore no writ petition would lie in the present case. ( 7 ) TO find the nature of the duty in the present case, it is not disputed that there was an agreement between the parties after the petitioner was given a loan for constructing a house. That agreement provided for payment of the money in specified instalments every month which money was to be deducted from the salary of the petitioner as given above. ( 8 ) IN the event of non-utilisation of the money, the entire amount was to become repayable immediately as mentioned above. ( 9 ) IT may however be pointed out that there is no stipulation about the mode in which the repayable amount was to be recovered in the event of non-utilisation as against manner of the recovery of the specific amount from the salary provided if amount was properly utilised. ( 10 ) IN the present case, the main challenge of the petitioner is the arbitrary manner in which that amount was being recovered by withholding almost the entire salary and paying only five rupees to the petitioner in one month. There is no term in the contract which governs this payment. This act has been challenged as unreasonable and unfair and thus violative of Article 14. ( 11 ) THE Ld. Counsel for the petitioner placed reliance on the decision of this Court in Sri Anupam Ghosh v. Union of India, 1991 (2) Calcutta High Court Notes 451. In this case it was held that mandamus, Prohibition and certiorari are public law remedies and are not available in enforcing private law rights. ( 12 ) IN the other case relied upon by the Ld.
In this case it was held that mandamus, Prohibition and certiorari are public law remedies and are not available in enforcing private law rights. ( 12 ) IN the other case relied upon by the Ld. Counsel for the respondents, Director, Indian Association for the Cultivation of Science, Yadavpur v. Ashok Kumar Roy, 1992 (1 )Calcutta Law Journal 319 also it was held that a writ of mandamus could not be issued against a private body to enforce a private right. It also held that a mandamus is a public law remedy and for enforcing of mandamus public duty must exist. ( 13 ) HOWEVER, the Supreme Court, in Kumari Srilekha Vidhyathi v. State of Uttar Pradesh and Ors. "there is an obvious difference in the contracts between private parties and contracts to which the State is a party. Private parties are concerned only with their personal interest whereas the State while exercising its powers and discharging its functions, acts indubitably, as is expected of it, for public good and in public interest. This factor alone is sufficient to import at least the minimal requirements of public law obligations and impress with this character the contracts made by the State or its instrumentality. It is a different matter that the scope of judicial review in respect of disputes falling within the domain of contractual obligations may be more limited and in doubtful cases the parties may be relegated to adjudication of their rights by resort to remedies provided for adjudication of purely contractual disputes. However, to the extent, challenge is made on the ground of violation of Article 14 by alleging that the impugned act is arbitrary, unfair or unreasonable, the fact that the dispute also falls within the domain of contractual obligations would not relieve the State of its obligation to comply with the basic requirements of Article 14. To this extent, the obligation is of a public character invariably in every case irrespective of there being any other right or obligation in addition thereto. An additional contractual obligation cannot divest the claimant of the guarantee under Article 14 of non arbitrariness at the hands of the State in any of its actions.
To this extent, the obligation is of a public character invariably in every case irrespective of there being any other right or obligation in addition thereto. An additional contractual obligation cannot divest the claimant of the guarantee under Article 14 of non arbitrariness at the hands of the State in any of its actions. Thus, in a case like the present, if it is shown that the impugned State action is arbitrary and, therefore, violative of Article 14 of the Constitution, there can be no impediment in striking down the impugned act irrespective of the question whether an additional right, contractual or statutory, if any, is also available to the aggrieved persons. The State cannot be attributed the split personality of Dr. Jekyll and Mr. Hyde in the contractual filed so as to impress on it all the characteristics of the State at the threshold while making a contract requiring it to fulfil the obligation of Article 14 of the Constitution and thereafter permitting it to cast off its garb of State to adorn the new robe of a private body during the subsistence of the contract enabling it to act arbitrarily subject only to the contractual obligations and remedies flowing from it. It is really the nature of its personality as State which is significant and must characterise all its actions, in whatever field, and not the nature of scrutiny permitted for examining the validity of its act. The requirement of Article 14 being the duty of act fairly, justly and reasonably, there is nothing which militates against the concept of requiring the State always to so act, even in contractual matters. There is a basic difference between the acts of the State which must invariably be in public interest and those of a private individual, engaged in similar activities, being primarily for personal gain, which may or may not promote public interest. Viewed in this manner, in which we find no conceptual difficulty or anachoronism, we find no reason why the requirement of Article 14 should not extend even in the Sphere of contractual matters for regulating the conduct of the State activity.
Viewed in this manner, in which we find no conceptual difficulty or anachoronism, we find no reason why the requirement of Article 14 should not extend even in the Sphere of contractual matters for regulating the conduct of the State activity. Even assuming that it is necessary to import the concept of presence of some public element in a State action to attract Article 14 and permit judicial review, we have no hesitation in saying that the ultimate impact of all actions of the State or a public body being undoubtedly public interest, the requisite public element for this purpose is present also in contractual matters. We, therefore, find it difficult and unrealistic to exclude the State action in contractual matters, after the contract has been made, from the purview of judicial review to test its validity on the anvil of Article 14". ( 14 ) THE aforesaid law as laid down by the Supreme Court provides that any action of the State even in contractual matters will have the necessary public element with a view to attract the judicial review especially when the challenge rests on the ground of violation of Article 14 of the Constitution. ( 15 ) IN the present case it is the unreasonableness of recovery which is being challenged and therefore it would attract the application of Article 14 and the action would be judicially reviewable, more so because the manner of recovery is not provided for in the contract and is not being challenged for being against it. I therefore, do not find any force in the preliminary objection raised on behalf of the respondents. ( 16 ) AS has been pointed out above on the petitioners failing to raise constructions, the entire amount of loan has become repayable. This proposition is not disputed. ( 17 ) THE respondents are recovering it from the salary of the petitioner to the extent that the petitioner is almost being denied the monthly salary. This act of the respondents is unreasonable.
This proposition is not disputed. ( 17 ) THE respondents are recovering it from the salary of the petitioner to the extent that the petitioner is almost being denied the monthly salary. This act of the respondents is unreasonable. ( 18 ) IN view of the fact that the salaries of wage earners arc protected in part by the provisions of Payment of Wages Act and also under Section 60, of the Code of Civil Procedure even against the decreed claims, the non-payment of the salary is likely to threaten the very existence of the person getting a salary and his dependents and would necessarily cause undue harassment to him, expecially when there is no such stipulation in agreement. ( 19 ) THE act of the respondents therefore in making such deductions without any statutory or contractual right to do so is unreasonable and is liable to be struck down. ( 20 ) CONSIDERING the provisions of Section 7 of the Payment of Wages Act, it is hereby directed that the respondents shall not make deductions from the salary of the petitioner as may exceed 50% of his gross wages, in respect of the loan taken by him. It will however be without prejudice to other terms of the agreement. The petition is therefore allowed in the aforesaid terms. There shall however be no order as to costs.