Suresh Chandra Singh v. Fertilizer Corpn Of India Limited
1998-10-16
M.C.AGARWAL, PALOK BASU
body1998
DigiLaw.ai
Judgment M.C. Agarwal, J. 1. The six writ petitions by the employees of the Gorakhpur Fertilizer Unit of the Fertilizer Corporation of India Limited (for short "fcil") relate to a common grievance and have raised identical pleas. The counsel from either side are also common and, there fore, all these six writ petitions have been heard together and will be disposed of by this common order. 2. WRIT Petition No. 23656 of 1998 in which counter and rejoinder affidavits, supplementary affidavits, supplementary rejoinder affidavits etc. have been ex changed will be the leading case from which we will state the requisite facts in this judgment. In other writ petitions also counter-affidavits have been filed and in writ petition Nos. 24069 and 27662 of 1998 rejoinder affidavits to have been filed. However, they are all more or less copies of what has been stated in connection with writ petition No. 23656 of 1998 and we may make a specific reference to them only if necessary. We have heard Sri Ravi Kiran Jain, learned Senior Advocate assisted by Sri K.K. Roy, Advocate, for the petitioners and Sri S.S. Bhatnagar, learned Senior Advocate assisted by Sri R.S. Mishra and Sri Awadhesh Rai, advocates for the respondents 1 to 4. 3. THAT most people love receiving money without earning it is the moral of the case set up by the petitioners who have gone even a step further to seek the help of this Court in achieving the aforesaid purposes. 4. As stated above, all the petitioners are employees of the FCIL employed in the Corporations fertilizer factory at Gorakhpur in the State of Uttar Pradesh. As a result of the recommendations of the Vth Central Pay Commission, the Government of India enhanced the age of retirement of its employees from 58 years to 60 years. The Government of India issued an office Memorandum (for short O.M.) dated 13th May, 1998 stating that the President has directed that every Government servant whose age of retirement is currently 58 years shall now retire from service on the afternoon of the last date of the month in which he/she attains the age of 60 years. A copy of the said O.M. is Annexure T to the writ petition. The Memorandum further states that these orders will come into force w.e.f. the date of notification of the amendment to the relevant rules and regulations etc.
A copy of the said O.M. is Annexure T to the writ petition. The Memorandum further states that these orders will come into force w.e.f. the date of notification of the amendment to the relevant rules and regulations etc. and will be applicable to Central Government employees except those who have already retired in accordance with the earlier rules and also those who are on extension in service. Simultaneously, by another notification of the same date the fundamental rules were amended with the result that the direction of the President to increase the age of retirement from 58 years to 60 years became effective from 13th May, 1998. Annexure 2' to the writ petition is a copy of the notification by which the service rules regarding age of retirement were amended. Then on 19th May, 1998 the Department of Public Enterprises in the Ministry of Industry, Government of India issued an O.M. stating that the Government has decided to enhance the age of retirement for below Board level employees of Central Public Sector Enterprises from 58 years to 60 years. This O.M. also stated that this decision will come into force w.e.f. from the date the relevant rules and regulations of the Public Sector Enterprises (for short 'pse') concerned are amended by the concerned PSE. As a result of the aforesaid O. M. the Board of Directors of the FCIL considered the matter and passed a resolution dated 6-7-1998 which has been reproduced in paragraph 3 of the counter-affidavit and reads as under:- "the Board noted that FCIL was referred to BIFR in April 1992 and declared sick in November, 1992. No revival package has been approved by BIFR so far. Gorakhpur Unit is closed since June 1990 carrying surplus of 1322 men as on 1-7-1998 and Kobra which was wound up is carrying surplus of 54 men. Besides, FCIL is carrying surplus in the Corporation all over for which a voluntary retirement scheme providing specific financial incentive to induce employees to seek early retirement is in operation since 1988 and so far 1524 persons have availed the benefit under the scheme as on 30-6-1998. FCIL is totally dependent on Government support for critical capital expenditure, working capital and to meet the huge operating losses by its units. Wages of the employees have not been revised as a result there has been a flight of taient.
FCIL is totally dependent on Government support for critical capital expenditure, working capital and to meet the huge operating losses by its units. Wages of the employees have not been revised as a result there has been a flight of taient. The only little incentive was promotion which will also be blocked in case age of retirement is enhanced from 58 years to 60. Enhancing the age of retirement involves financial implications which will further jeopardize the revival proposal of the Corporation before the BIFR. In view of the above the Board unanimously decided not to raise the age of retirement from 58 to 60 years." 5. IT is the refusal of the Board of Directors of the respondent to enhance the age of retirement of its employees which is the subject-matter of contest in this writ petition. The petitioners who were to retire after the issue of the aforesaid memorandum on attaining the age of superannuation have been served with notices dated 16th April, 1998 and 12th June 1998, intimating them that they will retire on the dates mentioned in the said notices. The petitioners in writ petition No. 23656 of 1998 have prayed for the following reliefs:- "(1) Issue a writ order or direction in the nature of certiorari quashing Order/notice dated April 16th, 1998 (Annexure No. 5) and order dated 12-6-1998 (Annexure No. 6) to the writ petition." "(2) Issue a writ order or direction in the nature of mandamus commanding respondent not to retire the petitioners before they attain the age of sixty years." "(3) Issue a writ order or direction in the nature of mandamus commanding respondent not to interfere with the functioning and discharging of duties of the petitioners of their respective offices till they attain the age of sixty years." 6. Similar are the reliefs claimed in the other writ petitions except that only in writ petition No. 27662 of 1998 a further relief is claimed that a writ of certiorari be issued quashing the Resolution/minutes dated 6-7-1998 of the Board of Directors. The case of the petitioners is that the FCIL, respondent No. 1 is a wholly owned Government of India Undertaking and is a 'state' within the meaning of Article 12 of the Constitution of India.
The case of the petitioners is that the FCIL, respondent No. 1 is a wholly owned Government of India Undertaking and is a 'state' within the meaning of Article 12 of the Constitution of India. The Department of Public Enterprises, Government of India has issued an O.M. dated 3-4-1991 (correct date is, however is 8-4-1991) conveying the decision of the Government of India that whatever instructions the Government wishes to give to Public Sector Undertakings would broadly fall in two categories and that the Presidential Directives that is once issued by the Administrative Ministries of the concerned Public Sector Undertakings will be binding and mandatory in nature. A copy of this O.M. is Annexure 4' to the writ petition. The case of the petitioners, therefore, is that the direction contained in the O.M. dated 19th May, 1998 are binding on the respondents FCIL and that in-spite of the said direction the petitioners have been served notices that they would retire on completion of 58 years. The petitioners after receiving the said notices have made representations to the G.M., FCIL, Gorakhpur which have not been decided. It is claimed that the notices are illegal being contrary to the policy decision conveyed in the O.M. dated 19th May, 1998. It is claimed that the notices are an example of hostile discrimination as the petitioners are sought to be retired at the age of 58 years whereas age of retirement has been increased to sixty years in the case of below Board level employees of Central Public Sector Enterprises. It is claimed that they have a vested right to continue in service till the sixty years of age. It is claimed that the action of the respondents in retiring the petitioners on completion of 58 years only is violative of Articles 14, 16 and 21 of the Constitution of India. It is claimed that the petitioner being employees of Central Public Sector Enterprises which is wholly a Government of India Undertaking cannot be discriminated from other Government servants who now retire on the completion of 60 years of age. 7. IN their counter-affidavits the respondents have explained the reasons why it is not feasible to enhance the age of retirement of the employees of FCIL. IN paragraph 3 of the counter-affidavit it has been stated as under:- "furthermore, the Gorakhpur Unit, to which all the petitioners belong, is lying closed since 10-6-1990.
7. IN their counter-affidavits the respondents have explained the reasons why it is not feasible to enhance the age of retirement of the employees of FCIL. IN paragraph 3 of the counter-affidavit it has been stated as under:- "furthermore, the Gorakhpur Unit, to which all the petitioners belong, is lying closed since 10-6-1990. This unit has 1313 employees on roll as on 1-8-1998 (1334 on 1-5-1998). Further there all 111 persons in U.P. Marketing. All these employees are getting their salaries and perks without having any substantial work to do. The aforesaid facts clearly demonstrate and substantiate that the petitioner have not come to this Hon'ble Court with clean hands and with mala fide intentions have deliberately concealed the vital facts from this Hon'ble Court. On this ground alone, the aforesaid writ petition deserves dismissal with exemplary costs. A true copy of the complete minutes of the 401st meeting of the Board of Directors of the Fertilizer Corporation of India held on 6-7-1998 is being filed herewith and marked as Annexure A-3' to this counter-affidavit. (ii) The Company is one of the highest loss making Company in the Country and till date the accumulated losses are to the tune of Rs. 4190. 25 crores (provisional) as on 31-3-1998 inclusive of provisional losses of Rs. 696. 59 crores for the financial year 1997-98, The Company is incurring financial losses of roughly Rs. 2. 0 crores every day. (iii) The Company has no capacity even to pay the salary and other perks for which it is getting a yearly non-plan budgetary support of Rs. 260. 00/270. 00 crores from the Government of India to pay the wages and salaries of over 7, 000 employees. (iv) The Company was referred to BIFR as back as in April 1992 and was declared sick on 6-11-1992. However, in view of the large financial implications involved, the Government of India has still not been able to take any decision for the revival of the Company and the matter is still pending before the BIFR. It is pertinent to slate here that the Company has the negative net worth to the tune of Rs. 2811. 82 crores as on 31-3-1997. IN view of such glaring facts the Company stands on a different footing from other Public Sector Undertakings. (v) The company has huge surplus man power and does not have sufficient work to gainfully employ them.
2811. 82 crores as on 31-3-1997. IN view of such glaring facts the Company stands on a different footing from other Public Sector Undertakings. (v) The company has huge surplus man power and does not have sufficient work to gainfully employ them. With a view to reduce the surplus man power, a Voluntary Retirement Scheme is in operation since 31-12-1998. Under the said scheme, 1524 employees have already taken voluntary retirement till 31-7-1998 (1506 on 31-3-1998). As a policy the Company is not taking any new employee on its roll and on the contrary is making conscious efforts to reduce the surplus man power. As a matter of fact, the company had 7920 employees in the month of January 1996 and 7604 in January 1997 which was reduced to 7201 in May 1998 and has further reduced to 7144 on 1-8-1998. (vi) One of its Divisions, namely, Korba Division has been wound up and there are 50 persons on the rolls. These employees are also getting their salaries and perks without having any work to do. (vii) The number of employees in the Company to produce same amount of fertilizer is 10 times more than the number of employees in other profit making public sector fertilizer companies. This is one of the main reason for the Company incurring continuous heavy losses. For example, for producing each 100mt of fertilizer the number of employees in Rashtriya Chemicals and Fertilizers Ltd. (RCF), National Fertilizer Ltd. (NFL) and the Respondent Company, i.e. Fertilizer Corporation of India Limited, (FCIL) and the profit/loss of these companies in the financial year 1997-98 are as under. NO. OF EMPLOYEES FOR EACH 1000 MT OF FERTILIZER. RCF: 3.8 NFL: 4.4 FCI:38.7 PROFIT OR LOSS IN THE YEAR 1997-98. RCF :rs. 174.55 Cr. profit. NFL :rs. 251.35 Cr. profit. FCI: Rs. 696. 59 Cr. loss. (viii) It is also relevant to state here that because of the continuous heavy financial losses and no revival package in sight no pay revision of the employees has taken place since 1992. While the other Public Sector Enterprises are taking steps for another wage revision which has be come due from 1-1-1997 the Company has been denied even the last revision which was due from 1-1-1992. " 8.
While the other Public Sector Enterprises are taking steps for another wage revision which has be come due from 1-1-1997 the Company has been denied even the last revision which was due from 1-1-1992. " 8. THERE is no denial of the averments made by the petitioners in paragraph 2 of the writ petition that the respondent is a 'state within the meaning of Article 12 of the Constitution of India. It is, however, stated that FCIL is a company incorporated under the Companies Act and is not a statutory body. It has its own Memorandum of Association and Articles of Association to conduct its business and take decisions. It is averred that the entire share capital of the company is held by the President of India who has power, right and authority to issue directive to the company in regard to the conduct of the business and affairs of the company. It is averred that the Board of Directors has powers to amend the service conditions/rules of its employees either under the directive of the President of India or prior approval of the President of India. Articles 67, 68 and 110 of the Article of Association have been reproduced in counter-affidavit. The photo copies of these documents have, however, been annexed by the petitioners to the supplementary rejoinder affidavit filed in writ petition No. 23656 of 1998 and the relevant portions thereof will be referred to at a later stage when necessary. It is averred, by the respondents that the workmen of the company are governed by the Standing Orders which have been framed under the Industrial Employment (Standing Orders) Act, 1946 and are duly certified by the competent authority. The employees who are not covered by the Standing Orders are governed by the FCI Employees (Conduct, Discipline and Appeal) Rules, 1972 and that unless the Standing Orders and the said rules are amended the employees of the company would continue to be governed by existing Service rules under which the age of superannuation is prescribed as 58 years. According to the respondents even after the issue of the aforesaid O.M. dated 19th May, 1998 employees of the respondents FCIL are being retired at the age of 58 years without any arbitrariness and discrimination.
According to the respondents even after the issue of the aforesaid O.M. dated 19th May, 1998 employees of the respondents FCIL are being retired at the age of 58 years without any arbitrariness and discrimination. It is claimed that the O.M. dated 19-5-1998 was forwarded to the company by its Administrative Ministry with a covering letter dated 25-5-1998 stating therein that the same be placed before the Board of Directors before adopting the same. It is pointed out that another Government Company viz. Hindustan Fertilizer Corporation Limited has also taken a decision not to raise the age of retirement from 58 years to 60 years. Another company, namely, Pyrites, Phosphates and Chemical Ltd. is also said to have taken a decision not to raise the age of retirement. It is claimed that the O.M. dated 19-5-1998 does not confer any right to the petitioners because superannuation is governed by the terms of the contract and in retiring the petitioners on attaining the age of superannuation at 58 years, there is no violation of any rights whatsoever. It is averred that it only the directives of the President of India that are binding on the companies and all other instructions, guidelines etc. received from various Ministries of the Government of India are only advisory in nature and have only persuasive value. The respondents too have referred to the O.M. dated 8-4-1991, copy of which is Annexure 4' to the writ petition. It is stated that the O.M. dated 19-5-1998 was issued by the Department of Public Enterprises and not by the Administrative Ministry of the respondents and, therefore, it is only of advisory value. According to the respondents, the Board of Directors has taken the decision against enhancing the age of retirement to 60 years in the best interests of the company and its decision applies to all the units of the FCIL situate at Sindri in Bihar, Gorakhpur in U.P., Ramagundam in Andhra Pradesh, Talcher in Orissa, Jodhpur Mining Organization in Rajas-than and Marketing Offices situate in the States of Andhra Pradesh, Orissa, West Bengal, Bihar and Uttar Pradesh and Korba Division in Madhya Pradesh. It is claimed that no citizen of India has a fundamental right under the Constitution to continue in service till he attains the age of 60 years and the age of retirement is deter mined by trite service rules. 9.
It is claimed that no citizen of India has a fundamental right under the Constitution to continue in service till he attains the age of 60 years and the age of retirement is deter mined by trite service rules. 9. ALTHOUGH, in the counter-affidavit, there was no denial of averment made by the petitioners specifically that the respondent is a 'state' within the meaning of Article 12 of the Constitution of India, yet the bulk of arguments ad dressed on either side was on the question as to whether the FCIL is a 'state' within the meaning of Article 12 of the Constitution of India. If the respondent is a 'state' then Part III of the Constitution containing fundamental right would apply to it and appropriate writ can be issued against it if there is any violation or infringement of such right. The rulings that were cited include State Trading Corporation of India v. The Commercial Tax Officer, AIR 1963 Supreme Court, 1811. In this case the question whether the State Trading Corporation was a 'state' within the meaning of Article 12 of the Constitution of India was not involved. The State Trading Corporation was the petitioner in this case before the Supreme Court and was complaining of certain action of the Commercial Tax Officer. The question was whether the State Trading Corporation which was a company registered under the Companies Act was a citizen and could maintain a writ petition under Article 32 for enforcement of fundamental right under Article 19. The Hon'ble Supreme Court held that a company is not a citizen and, therefore, cannot complain of violation of fundamental right. The judgment, therefore, does not deal with the controversy that we have before us. Reference was also made to Dr. S.L. Agarwal v. Hindustan Steel Ltd., AIR 1970 Supreme Court, 1150. In this case, S.L. Agarwal, who was a Doctor employed with Hindus tan Steel Ltd. and whose services were terminated claimed protection under Article 311 of the Constitution of India. The Hon'ble Supreme Court held that Hindus tan Steel Ltd. which was a company incorporated under the Companies Act as a Government company was not a department of the Government of India. It was observed that it has its independent existence and by law relating to Corporations it is distinct even from its members.
The Hon'ble Supreme Court held that Hindus tan Steel Ltd. which was a company incorporated under the Companies Act as a Government company was not a department of the Government of India. It was observed that it has its independent existence and by law relating to Corporations it is distinct even from its members. There fore, the appellant (S.L. Agarwal) did not hold a civil post under the Union and was not entitled to protection of Article 311 of the Constitution of India. This ruling thus, does not deal with the question whether Hindustan Steel Ltd. was a 'state' but it is important to note for the present case that it does hold that an employee of a Government company cannot equate him self to a public servant. 10. WE were also referred to Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi, AIR 1975 Supreme Court, 1331, in which statutory Corporations, namely, Oil and Natural Gas Commission, Life Insurance Corporation and Industrial Finance Corporation were held to be authorities within the scope of Article 12 of the Constitution of India. It was held that the Rules and Regulations framed by these authorities under the respective statute were statutory in character and their employees were entitled to a declaration of being in employment when their dismissal or removal is in contravention of statutory provisions. Sri Bhatnagar, learned Counsel for the respondent also referred to Sab-hajit Tiwary v. Union of India, AIR 1975 Supreme Court, 1329, in which the question was whether the Council of Scientific and Industrial Research was an authority within Article 12. The same Bench of five judges that decided Sukhdev Singh (supra), held that the said Council being registered under the Societies Registration Act was not a statutory Corporation and, there fore, it was not a 'state' within the meaning of Article 12 of the Constitution of India. The more important case to which reference was made from both the sides is, however, Som Prakash v. Union of India, AIR 1981 Supreme Court, 212. In that case, the petitioner Som Prakash had filed a writ petition in the Supreme Court against Bharat Petroleum Corporation Limited about certain pensionary rights and the question was whether Bharat Petroleum Corporation Limited was a 'state' within the meaning of Article 12 of the Constitution of India and a writ could be issued against it.
In that case, the petitioner Som Prakash had filed a writ petition in the Supreme Court against Bharat Petroleum Corporation Limited about certain pensionary rights and the question was whether Bharat Petroleum Corporation Limited was a 'state' within the meaning of Article 12 of the Constitution of India and a writ could be issued against it. Som Prakash petitioner in that case was employed as a clerk in the then Burmah Shell Oil Storage Co. Limited. The Government of India acquired the undertaking of this company under the Burmah Shell (Acquisition of Undertakings in India), Act, 1976. Burmah Shell Refineries Ltd. was a Government company and in accordance with the provisions of Section 7 of the Burmah Shell (Acquisition of Undertakings in India) Act, the Government of India vested the undertaking in Burmah Shell Refineries Limited and later in Bharat Petroleum Corporation Limited. It was after such vesting that Som Prakash had retired from service. Prior to Som Prakash's case was another case decided by the Hon'ble Supreme Court in the Hon'ble Supreme Court had laid down the tests to be applied LBESRJ Suresh Chandra: Singh and Ors. v. The Fertilizer Corpn. of India Limited 393] for determining whether an organisation was an authority or a 'state' within the meaning of Article 12 of the Constitution of India. These tests have been culled out and summarised in Som Prakash v. Union of India (supra) as under:- "39. Let us cull out from Airport Authority, ( AIR 1979 SC 1628 ) (supra) the indicia of "other authorities. . . . . . . under control of the Government of India" bringing a corporation within the definition of "the State". The following factors have been emphasised in that ruling as telling though not clinching. These characteristics convert a statutory corporation, a Government company, a co-operative society and other registered society or body into a State and they are not confined to statutory corporations alone. We may decoct the tests for ready reference: (1) "one thing is clear that if the entire share capital of the corporation is held by Government, it would go a long way towards indicating that the corporation is an instrumentality or agency of Government." (2) Existence of "deep and pervasive State control may afford an indication that the corporation is a State agency or instrumentality." (3) "it may also be a relevant factor. . . .
. . . whether the corporation enjoys monopoly status which is state conferred or State protected." (4) "if the functions of the corporation are of public importance and, closely related to governmental functions, it would be a relevant factor in classifying the corporation as an in strumentality or agency of Government." (5) "specifically, if a department of Government is transferred to a corporation it would be a strong factor supportive of this inference of the corporation being an instrumentality or agency of Government." "40. The finale is reached when the cumulative effect of all the relevant factors above set out is assessed and once the body is found to be an instrument or agency of Government, the further conclusion emerges that it is 'state' limitations as Government." 11. WHILE referring to Sabhajit Tewary (supra), the Hon'ble Supreme Court in the case of Som Prakash (supra) observed as under:- "43. We may first deal with Tewary's case, (1975) 3 SCR 616 : (AIR 1975 SC1329) where the question mooted was as to whether the C.S.I.R. (Council of Scientific and Industrial Research) was 'state' under Article 12. The CSIR is a registered society with official and non-official members appointed by Government and subject to some measure of control by Government in the Ministry of Science and Technology. The Court held it was not 'state' as defined in Article 12. It is significant that the Court implicitly assented to the proposition that if the society were really an agency of the Government it would be 'state'. But on the facts and features present there the character of agency of Government was negatived. The rulings relied on are, unfortunately, in the provice of Article 311 and it is clear that a body may be 'state' under Part III but not under Part XIV. Ray, CJ, rejected the argument that merely because the Prime Minister was the President or that the other members were appointed and removed by Government did not make the Society a 'state'. With great respect, we agree that in the absence of the other features elaborated in Airport Authority case, (1979) 3 SCC 489 : ( AIR 1979 SC 1628 ) the composition of the Governing Body alone may not be decisive. The laconic discussion and the limited ratio in Tewary, (1975) 3 SCR 616 : ( AIR 1975 SC 1329 ) hardly help either side here." 12.
The laconic discussion and the limited ratio in Tewary, (1975) 3 SCR 616 : ( AIR 1975 SC 1329 ) hardly help either side here." 12. THE Hon'ble Supreme Court further held that in order that an organisation may fall within the scope of 'state' or authority it was not necessary that the organisation must have been set up "by a statute and it was observed as under:- "55. Imagine the possible result of holding that a Government Company, being just an entity created under a statute, not by a statute, it is not 'state'. Having regard to the directive in Article 38 and the amplitude of the other Articles in Part IV Government may appropriately embark upon almost any activity which in a non-socialist republic may fall within the private sector. Any person's employment, entertainment, travel, rest and leisure, hospital facility and funeral service may be controlled by the State. And if all these enterprises are executed through Government companies, bureaus, societies, councils, institutes and homes, the citizen may forfeit his fundamental freedoms vis-a-vis these strange beings which are Government in fact but corporate in form. If only fundamental rights were forbidden access to corporations, companies, bureaus, institutes, councils and kindred bodies which act as agencies of the Administration there may be a break-down of the rule of law and the constitutional order in a large sector of governmental activity carried on under the guise of' Jural persons'. It may pave the way for a new tyranny by arbitrary administrators operated from behind by Government but unaccountable to Part III of the Constitution. We cannot assent to an interpretation which leads to such a disastrous conclusion unless the language of Article 12 offers no other alternative." "56. It is well known that 'corporations have neither bodies to be kicked, nor souls to be damned" and Government corporations are mammoth organisations. If Part III of the Constitution is halted at the gates of corporations Justice Louis D. Brandeis's observation will be proved true. The main objection to the very large corporation is that it makes possible and in many cases makes inevitable the exercise of industrial absolutism.
If Part III of the Constitution is halted at the gates of corporations Justice Louis D. Brandeis's observation will be proved true. The main objection to the very large corporation is that it makes possible and in many cases makes inevitable the exercise of industrial absolutism. It is dangerous to exonerate corporations from the need to have constitutional conscience: and so, the constitutional con science and so, that interpretation, language permitting, which makes governmental agencies, whatever their mein, amenable to constitutional limitations must be adopted by the Court as against the alternative of permitting them to flourish as an imperium in irnperio. "57. THE commonsense signification of the expression 'other authorities under the control of the Government of India' is plain and there is no reason to make exclusion one sophisticated grounds such as that the legal person must be a statutory corporation, must have power to make laws, must be created by and not under a statute and so on. The jurisprudence of Third World countries cannot afford the luxury against which Salmond cavilled, Salmond. Jurisprudence, 10th End. p. 51." With the aforesaid discussions, it was held that Bharat Petroleum Corporation Limited was a 'state' within the meaning of Article 12 of the Constitution of India. 13. Learned Counsel for the petitioners also referred to Central Inland Water Transport Corporation Ltd. v. Brojo Nath Gangufy, AIR 1986 SC 1571 , in which the question was whether the said Corporation which was a Government company under Section 617 of the Companies Act was a 'state' within the meaning of Article 12 of the Constitution of India. It was held that the said Corporation that was a Government Company within the meaning of Section 627 of the Companies Act was a 'state' within the meaning of Article 12 of the Constitution of India. The Hon'ble Supreme Court again relied on Ramana v. International Airport Authority (supra) and reproduced the following observations there from:- "a corporation may be created in one of two ways. It may be either established by statute or incorporated under a law such as the Companies Act, 1956 or the Societies Registration Act, 1860.
The Hon'ble Supreme Court again relied on Ramana v. International Airport Authority (supra) and reproduced the following observations there from:- "a corporation may be created in one of two ways. It may be either established by statute or incorporated under a law such as the Companies Act, 1956 or the Societies Registration Act, 1860. Where a Corporation is wholly controlled by Government not only in its policy making but also in carrying out the functions entrusted to it by the law establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government. But ordinarily where a corporation is established by statute, it is autonomous in its working, subject only to a provision, often times made, that it shall be bound by any directions that may be issued from time to time by Government in respect of policy matters. So also a corporation incorporated under law is managed by a board of directors or committee of management in accordance with the provisions of the statute under which it is incorporated. When does such a corporation become an instrumentality or agency of Government ?" (Emphasis supplied) After considering various factors and the case law on the subject, the Court thus summed up the position: "it will thus be seen that there are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of Government. We have referred to some of those factors and they may be summarised as under: Whether there is any financial assistance given by the State and if so what is the magnitude of such assistance whether there is any other form of assistance, given by the State and if so, whether it is of the usual kind or it is extra-ordinary, whether there is any control of the management and policies of the corporation by the State and what is the nature and extent of such control, whether the corporation enjoys state conferred or State protected monopoly status and whether the functions carried out by the corporation are public functions closely related to governmental functions.
This particularization of relevant factors is however not exhaustive and by its very nature it cannot be, because with increasing assumption of new tasks, growing complexities of management and administration and the necessity of continuing adjustment in relations between the corporation and Government calling for flexibility, adaptability and innovative skills, it is not possible to make an exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a corporation is governmental instrumentality or agency. Moreover even amongst these factors which we have described, no one single factor will yield a satisfactory answer to the question and the Court will have to consider the cumulative effect of these various actors and arrive at its decision on the basis of a particularized inquiry into the facts and circumstances of each case." The Hon'ble Supreme Court also referred to Ajay Hasia v. Khalid Mujib Sehravardi, AIR 1981 SC 487 and relied upon the following observations: "it is undoubtedly true that the corporation is a distinct juristic entity with a corporate structure of its own and it carries on its functions on business principles with a certain amount of autonomy which is necessary as well as useful from the point of view of effective business management, but behind the formal ownership which is cast in the corporate mould, the reality is very much the deeply pervasive presence of the Government. It is really the Government which acts through the instrumentality or agency of the corporation and the juristic veil of corporate personality worn for the purpose of convenience of management and administration cannot be allowed to obliterate the true nature of the reality behind which is the Government. Now it is obvious that if a corporations is an instrumentality or agency of the Government, it must be subject to the same limitations in the field of constitutional law as the Government itself, though in the eye of the law it would be a distinct and independent legal entity. If the Government acting through its officers is subject to certain constitutional limitations, it must follow a fortiorari that the Government acting through the instrumentality or agency of a corporation should equally be subject to the same limitations." 14.
If the Government acting through its officers is subject to certain constitutional limitations, it must follow a fortiorari that the Government acting through the instrumentality or agency of a corporation should equally be subject to the same limitations." 14. 'THUS, it is not necessary that in order to be identified as a 'state' or authority under Article 12 of the Constitution of India, the organisation must be a corporation established by a statute. As observed by the Hon'ble Supreme Court it may be a company like the present respondents registered under the Companies Act, it may be a society registered under the Societies Registration Act and, in our view, it may even be a partnership firm. For example if two entities falling within the scope of 'state' or authority under Article 12 of the Constitution of India enter into a partnership for carrying on certain business such partnership firm will also amount to a 'state' or authority within the meaning of Article 12 of the Constitution of India. We now proceed to see the relevant facts concerning FCIL. As stated in paragraph 2 of the writ petition, it is a company wholly owned by the Government of India. This is not denied in the counter-affidavit in which it is further clarified that 100 per cent shares of the company are held by the President of India. As stated above, copy of the Memorandum and Articles of Association of the FCIL have been annexed to the rejoinder affidavit. The Memorandum of Association shows that the Secretary and Joint Secretary of the Ministry of Commerce, Government of India constituted the company which was to have share capital of 800 crore of rupees. Articles of Association defined the corporation to include the Government. The Articles prohibit any invitation for public to sub scribe for any shares or debentures. The other relevant clauses of the Articles are as under:- "42. (1) The President, so long as he is a share-holder of the Company, may from time to time appoint one or more persons (who need not be a member or members of the Company) to represent him at all or any meetings of the Company.
The other relevant clauses of the Articles are as under:- "42. (1) The President, so long as he is a share-holder of the Company, may from time to time appoint one or more persons (who need not be a member or members of the Company) to represent him at all or any meetings of the Company. (2) Only one of the persons appointed under sub-clause (1) of this Article shall be deemed to be a member of the Company and shall be entitled to vote and be present in person and exercise the same rights and powers (including the right to vote by proxy) as the President could exercise as a member of the Company. (3) The President, may, from time to time, cancel any appointment made under sub-clause (1) of this Article and make fresh appointments." "65. The number of the Directors shall not be less than 2 and more than 15. The Directors are not required to hold any qualification shares." "66. (1) The Directors representing the Government shall be appointed by the President of India. All other members of the Board of Directors shall be appointed by the President of India in consultation with the Chairman of the Board of Directors and shall be paid such salary and or allowance as the President may from time to time determine. (2) At every annual general meeting of the company all the Directors except the Managing Director, Executive Directors and Functional Directors shall retire from office. The Managing Director, Executive Directors and functional Directors shall retire on his/their ceasing to hold the office of the Managing Director, Executive Directors and Functional Directors. A retiring Directors shall be eligible for re-appointment. (3) The President shall have the power to remove any Director including the Chairman, the Managing Director, Executive Director/s and Functional Director/s from office at any time and in his absolute discretion. (4) The President shall have the right to fill any vacancy in the office of a Director caused by retirement removal, resignation, death or other wise." "69.
(3) The President shall have the power to remove any Director including the Chairman, the Managing Director, Executive Director/s and Functional Director/s from office at any time and in his absolute discretion. (4) The President shall have the right to fill any vacancy in the office of a Director caused by retirement removal, resignation, death or other wise." "69. (1) For the conduct and management of the business of the Company in general subject to the control and supervisions of the Board of Directors, the President may empower the Chairman nominated under Article 77 to exercise the functions of the Managing Director or appoint one of the Directors to be the Managing Director who will be the Chief Executive Officer of the Company. The President may also appoint one or more of the Directors to be an Executive Director, Functional Director or Executive Director/functional Directors. The functions, duties and responsibilities of an Executive Director/functional Director shall be such as may be determined by the President from time to Directors. (2) The Chairman so empowered or the Managing Director or an Executive Director/functional Director or Executive Directors/functional Directors so appointed shall be whole time employees of the Company and shall be paid such salary and allowances as may be fixed by the President." "69-B. (1) The President may in his discretion appoint one of the Directors to be the Finance Director of the Company." "106. Once at least in every year the ac counts of the Company shall be examined and the correctness of the profit and loss account and balance-sheet ascertained by one or more auditors." 107. The Auditor shall be appointed or re-appointed by the Central Government on advice of the Comptroller and Auditor General of India and his remuneration shall be fixed by the Central Government. "108. The Comptroller and Auditor General of India shall have power:- (a) to direct the manner in which Company's accounts shall be audited by the auditor appointed in pursuance of Article 107 and to give to any matter relating to the performances of his functions as such." '110. Notwithstanding anything contained in any of these Articles, the President may, from time to time issue such directives if he may consider necessary in regard to the conduct of the business and affairs of the Company or Directors thereof and in like manner may vary and annul any such directive.
Notwithstanding anything contained in any of these Articles, the President may, from time to time issue such directives if he may consider necessary in regard to the conduct of the business and affairs of the Company or Directors thereof and in like manner may vary and annul any such directive. The Directors shall give immediate effect to directives so issued. The President shall have powers to: (i) give directions to the corporation to the exercise and performance of its functions in matters involving national security substantial public interest and to ensure that the Corporation gives effect to such directions; (ii) call for such returns, accounts and other information with respect to the property and activities of the Corporation as may be required from time to time; (iii) authorise the amount of capital to be raised and the terms and conditions on which it may be raised; (iv) approve the Corporation's five year and annual plan of development and the Corporation's capital budget; (v) approve the corporation's revenue dud get in case there is an element of deficit which is proposed to be met by obtaining funds from the Government; (iv) approve agreements involving foreign collaboration proposed to be entered into by the Corporation and to approve purchases and contracts of a major nature involving substantial capital outlay which are in excess of the powers vested in the Corporation." 15. THE aforesaid provisions show that (1) the entire share capital is owned by the President of India i.e. the Union of India, (2) the President representing the Union of India has complete control over the management and the affairs of the company because he has the authority to appoint and remove the Directors who will constitute the Board of Directors (3) the President by virtue of article 66 (3) of the Articles of Association has the power to remove any Director including the Chairman, Managing Director, the Executive Director etc. at any time and in his absolute discretion, (4) Chairman of the Corporation has to be appointed by the President in terms of Article 77 and (5) the accounts of the Corporation have to be audited by an Auditor appointed by the Central Government on advice of the Comptroller and Auditor C general of India who has power to direct the manner in which the company's account shall be audited by an Auditor.
Then under Article 110 the President has the power to issue directives to the company and the Directors are required to give immediate, effect to the Directives so issued. The aforesaid features leave no doubt that it is the Government of India that is functioning with the instrumentality of a company incorporated under the companies Act and in view of the law as declared by the Hon'ble Supreme Court, we hold that it is a 'state' and authority within the meaning of Article 12 of the Constitution of India. 16. Learned Counsel for the petitioners also pointed out that the Hon'ble Calcutta High Court in Uma Shankar Chatterjee v. Union of India, 1982 LIC 1361, has held that the respondent FCIL is a 'state' within the meaning of Article 12 and is amenable to writ jurisdiction of the Court though its employees are not entitled to the protection of Article 311 of the Constitution of India. Learned Counsel for the parties did not address us on the point whether the said judgment concludes the issue in favour of the petitioners and operates as res judicata. However, since we have independently come to the same conclusion we do not think it necessary to touch upon this point any further. We conclude that the respondent FCIL is a 'state' or authority within the meaning of Article 12 of the Constitution of India and is amenable to writ jurisdiction of this Court. 17. THE next controversy between the parties is whether the O.M. dated 19-5-1998 creates a binding obligation on the FCIL to enhance the retire rent age. In this connection it is important to remember that the inter se relationship between the President/government of India and the FCIL is not regulated by any statute. In other words, the said OM is not statutory in character. It has been issued by the Department of Public Enterprises of the Government of India. Under Article 110 of the Articles of Association of FCIL, the president may from time to issue such directives as he may consider necessary in regard to the conduct of the business and affairs of the Company. The nature and effect of the directives has been clarified in the OM dated 8-4-1991, Annexure 4' of the writ petition. The directions are categorized as President Directives and guidelines.
The nature and effect of the directives has been clarified in the OM dated 8-4-1991, Annexure 4' of the writ petition. The directions are categorized as President Directives and guidelines. The relevant portion of the OM is as under:- "(i) Presidential Directives.-These are issued by the administrative ministries to the concerned PSUS whenever the situation so war rants and are mandatory in nature. For the purpose of maintaining uniformity, such Directives shall be issued in consultation with the DPE if these relate to single PSU and with the concurrence of the DPE if these are applicable to more than one PSU. Further, the DPE could also ask the administrative Ministries to issue Presidential Directives to one or more PSUS on policy issues requiring a uniform approach." "(ii) Guidelines.-These could be issued either by the administrative Ministry or the DPE as the case may be and will be advisory in nature. THE Board of Directors of the PSUS will have the discretion not to adopt these guidelines for reasons to be recorded in writing. THE Board Resolution on the subject giving the reasons therein should be forwarded both to the ad ministrative Ministry concerned as well as to the DPE." 18. THUS a Presidential Directive is binding on the PSE and must be complied with unless recalled or modified. Such a Directive has to be issued by the administrative ministry of PSE concerned. The FCIL is under the ministry of Fertilizers and Chemicals. The OM dated 19-5-1998 has, however, been issued by the DPE (Department of Public Enterprises) it, therefore, is not a Presidential Directive and as explained in the OM dated 8-4-1991. It will be treated as a guideline which may or may not be followed. A sample of a Presidential Directives has been annexed by the respondents as Annexure AT to the affidavit of Subhash Seth appended to the Civil Misc. Modification Application No. ? of 1998 filed in Writ Petition No. 23656 of 1998. It is contained in a letter dated 17014/4/91/g. C. dated 1-8-1991 and the material part reads as under:- "in terms of Article 110 of the Articles of Association of. . . . . . .
Modification Application No. ? of 1998 filed in Writ Petition No. 23656 of 1998. It is contained in a letter dated 17014/4/91/g. C. dated 1-8-1991 and the material part reads as under:- "in terms of Article 110 of the Articles of Association of. . . . . . . ., the 'president is pleased to direct the Fertilizer Corporation of India that the following measures should be taken with regard to the reservation for Scheduled Castes and Scheduled Tribes in appointment to the various posts in Company." Annexure A-8 to the said affidavit is copy of another similar communication dated 12-1-1996 with regard to the reservation for OBCs in direct recruitment to the various posts in the Company. These documents have not been controverted. They have been issued by the Ministry of Chemicals and Fertilisers which is the administrative machinery of the FCIL and specifically state that they are directions issued by the President under Article 110 of the Articles of Association of the Company i.e. FCIL. Therefore, the O.M. dated 19-5-1998 is not a Presidential Directive within the meaning of Article 11'o and as explained in O.M. dated 8-4-1991 and is not binding on the FCIL. 19. LET us look at the issue from another angle. Suppose the instructions contained in OM dated 19-5- 1998 was a Presidential Directive binding on the FCIL and the later declines to company with it. Can the petitioners or even the President himself come to a Court under Article 226 of the Constitution of India and seek an appropriate writ for enforcement of the Presidential Directive ? The answer would certainly be No. The reason is that a Presidential Directive is not issued under any statute and is, therefore, not statutory in character. It does not create any statutory obligation or duty the performance of which can be enforced through a mandamus. The Presidential Directive is akin to an order by a master to his servant or by a principal to his agent or by the share holders of a company to its Directors through a resolution in a general meeting. 20. FCIL is a separate legal entity being a company incorporated under the Companies Act. Dealing with the nature of personality of a company in State Wading Corporation of India, Ltd. v. The Commercial Tax Officer (supra) the Hon'ble Supreme Court observed as under:- "29.
20. FCIL is a separate legal entity being a company incorporated under the Companies Act. Dealing with the nature of personality of a company in State Wading Corporation of India, Ltd. v. The Commercial Tax Officer (supra) the Hon'ble Supreme Court observed as under:- "29. We are dealing here with an incorporated company. The nature of the personality of an incorporated company which arises from a fiction of law, must be clearly understood before we proceed to determine whether the word 'citizen' used in the Constitution generally or in Article 19 specially covers an incorporated company. Unlike an unincorporated company, which has no separate existence and which the law does not distinguish from its members, an incorporated company has a separate existence and the law recognizes it as a legal person separate and distinct from its members. This new legal personality emerges from the moment of incorporation and from that date the persons subscribing to the memorandum of association arid other persons joining as members are regarded as a body corporate or a corporation aggregate and the new person begins to function as an entity. But the members who form the incorporated company do not pool their status or their personality. If all of them are citizen of Indian the company does not become a citizen of Indian any more than if all are married the company would be a married person. The personality of the members has little to do with the person a of the incorporated company. The per son a that comes into being is not the aggregate of the personae either in law or in metaphor. The corporation really has no physical existence, it is a mere 'abstraction of law' as Lord Selborne described it in G.E. Rly., Co. v. Turner, (1872) Ch A 149 at p. 152 or as Lord Machnghten said in the well known case of Salomon v. Salomon and Co. Ltd., 1897 AC 22 at p. 51, it is "at law a different person altogether from the subscribers to the memorandum of association "this distinction is brought home if one remembers that a company cannot commit crimes like perjury, bigamy or capital murder.
Ltd., 1897 AC 22 at p. 51, it is "at law a different person altogether from the subscribers to the memorandum of association "this distinction is brought home if one remembers that a company cannot commit crimes like perjury, bigamy or capital murder. This persona ficta being a creature of a fiction, is protected by natural limitations as pointed out by Palmer in his Company Law (20th Edn.) p. 130 and which were tersely summed up by counsel in R.V. City of London, (1632) 8 SV Tr. 1087 at p. 1138 when he asked "can you hang its common seal ?" It is true that sometimes the law permits the corporate veil to be lifted, but of that later." Therefore, in case the President directions are not complied with and the President wants to secure compliance, the course open to him is to remove the managing director/directors and appoint new managing director/directors who are obedient. 21. SRI Bhatnagar, learned Senior Counsel for the respondents placed reliance on Praga Tools Corporation v. C.V Manual, AIR 1969 SC 1306 , in which it was held that an application for mandamus lies to secure the performance of a public or statutory duty in the performance of which one who applies for it has a sufficient legal interest. Thus an application for mandamus will not lie for an order of reinstatement to an office which is essentially of a private character nor can such an application be maintained to secure performance of obligations owed by a company towards its workman or to resolve any private dispute. An order of mandamus is, in form, a command directed to a person, corporation, or an inferior tribunal requiring him or them to do a particular thing therein specified which appertains to his or their nature and is in the nature of a public duty. 22. In the present cases the petitioners have not claimed a writ of mandamus to direct the FCIL to comply with the alleged Presidential Directive and to amend the concerned service rules. On the other hand, they claim writs of certiorari to quash the retirement notices and writs of prohibition to restrain the respondents from retiring them. They proceed as if the OM dated 19-5-1998 by itself raises the age of retirement to 60 years.
On the other hand, they claim writs of certiorari to quash the retirement notices and writs of prohibition to restrain the respondents from retiring them. They proceed as if the OM dated 19-5-1998 by itself raises the age of retirement to 60 years. The said OM is an administrative direction and a mandamus does not lie to enforce departmental manuals or instructions not having the force of law. State of Assam v. Ahlt Kumar, AIR 1965 SC, 1196; Raman v. State of Madras, AIR 1959 SC 2641. A writ of mandamus or any other writ under Article 226 would not issue against a company registered under the Companies Act even though it may be a Government Company or against a statutory corporation unless it is vested with statutory duties (Heavy Engineering Mazdoor Union v. State of Bihar, (1969) 1 SCC 765 ). The respondent FCIL is a commercial organisation having no public or statutory duty to perform. The contracts of service between the petitioner and the FCIL are not statutory contracts but are private contracts regulated inter alia by the Standing Orders and service rules which do not have the force of law. Therefore, any service dispute between the petitioners and the respondent FCIL can not be resolved by resort to writ jurisdiction of the High Court under Article 226. 23. As stated, the OM dated 19-5-1998 stated that the relevant service rules be amended and that the enhancement in age of retirement would be effective on the amendment of the rules. So far the respondent has not amended the rules and its resolution dated 6-7-1998 contains a refusal to amend the rules. Unless the rules are amended the petitioners to do not get any right to superannuate on attaining the age of 60 years and there is no legal right than can be enforced in any manner whatsoever. 24. IT was contended that the action of the FCIL is not raising the age of retirement to 60 years is violative of Article 14 of the Constitution of India. The contention is three fold. Firstly it was contended that the age of retirement of Central Government employees having been raised, the same should follow in the case of public sector employees particularly of the FCIL which is a 100 per cent owned Government Company and is an instrumentality of the Central Government.
The contention is three fold. Firstly it was contended that the age of retirement of Central Government employees having been raised, the same should follow in the case of public sector employees particularly of the FCIL which is a 100 per cent owned Government Company and is an instrumentality of the Central Government. The corporate status of FCIL is said to be merely a veil which should be lifted to see the Government behind it. This contention is not enable "lifting the veil" is permissible where it is adopted merely as a device to conceal the real thing. FCIL is a genuine company under the Companies Act and its corporate character cannot be thrown away to deny the Government the benefits and protection resulting from its separate corporate existence. Further such contentions have consistently been rejected (See S.L. Agarwal (supra)) and employees of Government Companies have been treated as a different class altogether. The two cannot claim parity with each other. The first ground, therefore, fails. The second contention was that the age of retirement of board level employees has been raised to 60 years and, therefore, denial of this benefit to the petitioner is violative of the principle of equality. Reliance is placed on an OM dated 30-5-1998 (Annexure T to the rejoinder affidavit) issued by the DPE communicating the Government's decision to increase the age of retirement of Board level employees and all administrative Ministries/departments have been requested to take necessary action to implement the decision. Board Level employees are few and are a class by them selves and, therefore, there can be reasonable discrimination. They are not cadre based posts. Further there is nothing to show that FCIL has implemented the Government's decision in that regard. This contention too thus has no merit. 25. THE third complaint of unequal treatment is that some other PSFs have raised the age of retirement to 60 years. It is admitted that some PSEs have done so. But there are others also who have not done so. In our view each PSE is a separate unit and the principle of equality enshrined in the Constitution cannot be so enlarged as to require exactly similar ser vice conditions in all of them. Each PSE has a right to prescribe its own conditions of employment depending on its own circumstances.
In our view each PSE is a separate unit and the principle of equality enshrined in the Constitution cannot be so enlarged as to require exactly similar ser vice conditions in all of them. Each PSE has a right to prescribe its own conditions of employment depending on its own circumstances. The FCIL in its counter-affidavit has given very cogent apposite and compelling reasons that fully justify its refusal to abide by the instructions. We have already reproduced the facts as narrated in the counter-affidavit and they have not at all been controverted. The respondent FCIL is deep red with accumulated losses of 4150 crores against a capital of Rs. 800 crores. Thus, it has a negative worth of 3350 crores. It is sick and has been so declared by the Board for Industrial and Financial Reconstruction in November, 1992 and till date no revival package has been found. It incurs a loss of Rs. 2 crores a day. Its Korba unit has been wound up. The Gorakhpur unit, where the petitioners were employed, is shut up since 10-6-1990 and the petitioners and others have no work to do. Thus for the last more than eight years they have been feeding without any labour. The FCIL is, therefore, a class by itself and its decision not to raise the age of retirement to 60 years does not result in unreasonable classification. THE decision is quite appropriate and business like in the circumstances of the case. FCIL is over staffed. It has framed a voluntary retirement scheme (VRS) which is inforce from 31-12-1998. It would be anamolous to en courage employees to seek voluntary retirement on the one hand and to enhance the age of retirement on the other. 38. As the Gorakhpur unit is lying closed since June, 1990 and a VRS was in force since 1998 it would have been proper for the petitioners to avail that opportunity and retire long back to seek other pastures of life if they so desired. They had, however, no such grace and have choosen to be parasites. Last of all they have shamelessly choosen to come to this Court to advance their parasitic per-suits for two years more. THE Court does not assist such Sersons. There is nothing in Mahabirauto tores v. Indian Oil Corporation, AIR 1990 SC 1031 , which could be pressed into service by their learned Counsel.
Last of all they have shamelessly choosen to come to this Court to advance their parasitic per-suits for two years more. THE Court does not assist such Sersons. There is nothing in Mahabirauto tores v. Indian Oil Corporation, AIR 1990 SC 1031 , which could be pressed into service by their learned Counsel. No right of the petitioners is infringed and the action of respondents is fair, bonafide and legal. 39. In view of the above discussion, these writ petitions are misconceived and ill-intended. They are hereby dismissed. The interim orders are vacated. It is ordered that no petitioner in any of these writ petitions will be entitled to any salary, allowance, etc. for the period after the date on which he would have retired but for the orders of this Court in these petitions. Palok Basil, J.-Put in simple language avoiding legal terminology, the only question involved in this bunch of six writ petitions is whether decision of the Government of India dated 13-5-1998 enhancing the age of its employees from 58 to 60 years and office Memorandum dated 19-5-1998 issued by Ministry of Industry to raise retirement age of below Board Level Employees of Central Public Sector Enterprises from 58 to 60 years would bind the management of Fertilizer Corporation of India Ltd. (FCI) to increase the petitioners' ages also from 58 to 60years. 41. The learned Judgment prepared by my esteemed brother, Hon'ble Mr. Justice M.C. Agarwal, has dealt with all the relevant facts and circumstances of each petition. He has also dealt with the distinction between the respective petitioners and has elaborately discussed the arguments. The conclusions reached by my brother have to be respectfully agreed, but a few reasons occurring to the undersigned do require mention. Hence, this separate judgment. 42. Sri Ravi Kiran Jain's primary argument on behalf of the petitioner is that since FCI is an 'authority' within the meaning of Article 12 of the Constitution of India, it is immaterial whether or not FCI is a Government company under the Indian Companies Act because its shares are with the President of India, the FCI cannot by pass the Central Government's aforesaid decision on any pretext.
THE petitioners, therefore, should be equated with those Central Government Employees who are going to take ad vantage of the aforesaid decision and if FCI chooses not to abide by it, such an action will be arbitrary and hit by Articles 14, 16 and 21 of the Constitution and, therefore, a mandamus should go to FCI to implement the said decision for the petitioners also. 43. Sri Shanti Swarup Bhatnagar, learned Senior Counsel, for FCI in rebuttal argued that FCI is not statutory body, it is incorporated as 'government Company' under the Companies Act, its business, activities and relation with its employees are governed by decisions of 'board of Directors' and 'standing orders'. Therefore, the petitioners are to be governed always by rules and decisions of Board of Directors and 'standing orders' and it will not matter even if the FCI is identified as an authority under Article 12 of the Constitution because the contract of service which is subsisting between the petitioners and FCI has to survive and, therefore, the petitioners cannot invoke Articles 14, 16 and 21 in order to by pass the said contract. It was further argued that since FCI is admittedly a Government company, a mandamus could not go, be cause a writ is issued only against the State. Therefore, if any individual petitioner can raise the issue before Civil Court or Labour Court, he has to opt for the same and writ jurisdiction cannot be invoked. 44. Fortunately, most of the decisions cited by either side are common and there is no disagreement on factual basis between Sri Jain and Sri Bhatnagar. The question posed at the outset, therefore, depends upon the outcome from the decisions cited at the bar and a few provisions existing in the Constitution, Companies Act and some other Enactments. 45. Before examining the various rulings cited at the Bar, the purpose, import and meaning of the expression Authority' used in Article 12 of the Constitution, must be clearly borne in mind. As is obvious, Article 12 exists as the first Article in Part III of the Constitution dealing with Fundamental Rights, Articles 14 and 16 enshrine "right to equality" while Article 21 safeguards "right to freedom".
As is obvious, Article 12 exists as the first Article in Part III of the Constitution dealing with Fundamental Rights, Articles 14 and 16 enshrine "right to equality" while Article 21 safeguards "right to freedom". One of the basic principles to be borne in mind is that even if a Corporation is deemed to be an Authority' it would not be correct to say that the Corporation would be subject to the Constitutional limitation of fundamental rights in the performance of all its functions and that the nomenclature "authority" would stick to such Corporation irrespective of the functional context. This is the ratio flowing from M.C. Mehta v. Union of India, AIR 1987 SC 1086 , which is Constitution Bench decision including three former Hon'ble C.J. Is Hon'ble P.N. Bhagwati, Hon'ble Ranganatha Misra and Hon'ble K.N. Singh, apart from Hon'ble G.L. Oza and Hon'ble MM. Dutta, JJ. THE fundamental rights covered by Part III are not distinct or mutually exclusive. A law depriving a per son of personal liberty and prescribing procedure for that purpose within the meaning of Article 21, has to stand a test of one or more of fundamental rights which may be applicable in a given situation. Therefore, concept of reasonableness must be protected in the procedure contemplated by Article 21 having regard to impact of Article 14 on Article 21 having regard to impact of Article 14 on Article 21. This is the second basic principle to be borne in mind which is the gist of the decision in Meneka Gandhi v. Union of India and another, AIR 1978 SC 597 . Certain paragraphs from Menaka Gandhi's case were cited by Sri Jain as well as by Sri Bhatnagar. It, however, appears that in the instant bunch of writ petitions there is no challenge to any proceeding or law or procedure which may be depriving the petitioners of any right which they may have been possessing from before filing of the writ petition. THE petitioners are clamouring to have more benefits than their contract of employment provides be cause those benefits have been extended by Central Government to its employees. 46.
THE petitioners are clamouring to have more benefits than their contract of employment provides be cause those benefits have been extended by Central Government to its employees. 46. It has not to be told that a corporation is an artificial creature and exists only in the contemplation of the law and possesses only those powers which the charter of its creation confers on it, either expressely, or as incidental to its very existence, calculated to effect the object for which it was created. Although corporate personality is not a modern invention, its adoption to facilitate running of the wide range of industry and commerce in our governmental system has a modern flavour. Our constitution has more beautified our beautiful mother-land to make it a "welfare State". THE Government may, therefore, have to execute many economic projects and thus take recourse to this resourceful legal contrivance be cause of its practical advantages without any diminution in ownership and control of the Corporation, Society or the Under taking, as the case may be. In such a case the true owner, the real operator and the effective control will that be of the State and consequently, accountability for its actions to the community and to the Parliament will also be that of the State. Never the less, a distinct juristic person with a corporate structure conducts the business of such company, society, undertaking or corporation which comes in handy from the point of view of business management. Therefore, the third basic principle to be borne in mind is that such a corporation or company etc. (as the case may be) does not work as a department of the Government nor are the servants of its holding posts under the State. It will have the independent existence by the law it may be created or governed. Even though the en tire share capital of a company has been subscribed by the Government of India, it cannot be predicted that the companies themselves are owned by the Government of India. The Companies which are incorporated under the Companies Act have a corporate personality of their own, distinct from the Government of India. The lands and buildings of such company stand vested and owned by those Companies the Government of India only owns share capital. Therefore, no Court can hold that such a company was or is a department of the Government of India.
The lands and buildings of such company stand vested and owned by those Companies the Government of India only owns share capital. Therefore, no Court can hold that such a company was or is a department of the Government of India. This third basic principle is the cumulative ratio of "dr. S.L. Agarwal v. The General Manager, Hindustan Steel Ltd., AIR 1970 SC 1150 ; Western Coalfields Ltd. v. Special Area Development Authority, Kobra and another, AIR 1982 SC 697 and Steel Authority of India v. Shri Ambika Mills Ltd. and others, AIR 1998 SC 418 '. 47. Sri Jain has, however, heavily relied upon Articles 14 and 16 and with that end in view he repeatedly cited paragraphs from R.D. Shetty v. I.A.A., 1979 (3) SCC 489 and Som Prakash Rekhi v. Union of India and another, AIR 1981 SC 212 . Reliance was also placed by Sri Jain on 'o. N.G.C. v. N.G.C. Industries, AIR 1990 SC 1851 ', in order to argue that just as ONGC is, the FCI is also State within the meaning of Article 12 and, therefore, is duty bound to act reasonably and fairly in consonance with the directive principles of the State policies and provide equality in terms of employment to the petitioners with the terms of Central Government employees. However, as far as possible, this Court's exercise shall follow soon hereafter to go into all the relevant case laws up-to-date and try to demarcate applicability of those decisions on certain categories of litigations. 48. In Tekraj Vasandi alias K.L. Basandhi v. Union of India and others, 1988 (1) SCC 236 , it has been held that Institution of Constitutional and Parliamentary Studies (ICPs) is a society registered in 1965 under the Societies Registration Act, 1860. It was receiving Government grants and Government money was coming regularly and also getting some money from some other sources. It is further held that there cannot be a strait jacket formula. It is not necessary that all the tests should be satisfied for reaching the conclusion either for or against holding an institution to be 'state'. In a given case some of the features may emerge so boldly and prominently that a second view may not be possible.
It is further held that there cannot be a strait jacket formula. It is not necessary that all the tests should be satisfied for reaching the conclusion either for or against holding an institution to be 'state'. In a given case some of the features may emerge so boldly and prominently that a second view may not be possible. There may yet be other cases where the matter would be on the border line and it will be difficult to take one view or the other outright. A broad picture of the matter has to be taken and a discerning mind has to be applied keeping the realities and human experiences in view so as to reach a reasonable conclusion. 49. In this case it was further held that even if ICPS becomes state within the meaning of Article 12, its employees do not become holders of similar posts so as to become entitled to the cover of Article 311. They would, however, be entitled to the benefits of Part III of the Constitution. It was held unnecessary to examine the appellant's case keeping Articles 14 and 16 in view as on the concession of the Counsel of ICPS the proceedings will have to reopen. 50. It is thus apparent that this is a matter directly concerning an employee of ICPS. 51. In 'all India Sainik Schools Employees' Association v. Defence Minister-cum-Chairman Board of Governors, Sainik Schools society, New Delhi and others, 1989 supp. (1) SCC205, it was held that Sainik School Society is 'state' within the meaning of Article 12 and, therefore, since the entire funding is by the State Governments and Central Government, Parts III and IV of the Constitution would be applicable. Simultaneously, it was stated that employees of Sainik School Society constitute a class distinct from and not comparable with those of Kendriya Vidyalaya Sangathan. Hence, difference in conditions of employment between the two institutions was held not open to challenge on ground of viplation or Article 14. It was further held that to put the unequals as equals is against the objective of Article 14 in the same way as is to discriminate between equals. 52.
Hence, difference in conditions of employment between the two institutions was held not open to challenge on ground of viplation or Article 14. It was further held that to put the unequals as equals is against the objective of Article 14 in the same way as is to discriminate between equals. 52. This also was a case where employees wanted the benefits by resorting to Articles 14 and 16 of the Constitution, but except extending some benefits of loan or advances for house construction, no other benefit was extended to the employees. 53. In the case of 'chairman, School of Buddhist Philosophy, Deh Ladakh (J and K) v. Makhan Lalmatoo and another, 1990 (4) SCC 6 , Central Institute of Buddhist Studies was held to be an authority within Article 12. It is pointed out that the aforesaid finding was given on concession of the learned Counsel. 54. In Bihar State Harijan Kalyan Parishad v. Union of India and others, 1985 (2) SCC 644 , Steel Authority of India was held to be an instrumentality of the State and an authority. In this case question of extending reservation to Scheduled Castes and Scheduled Tribes employees on promotional posts came up for consideration. THE letters were quashed and the Presidential Directives about reservation were directed to be followed. 55. In 'surya Narain Yadav and others v. Bihar State Electricity Board and others', 1985 (3) SCC 38 , the State Electricity Boards were held to be 'authorities' within Article 12. In this case certain promises made to Junior Engineers and Assistant Engineers from time to time were directed to be obeyed, because it was held that the Board was bound to regularise the appointments of those appellants who had been taken as trainee Engineers and continued under employment. 56. In B.S. Minhas v. Indian Statistical Institute and others, 1983 (4) SCC 582 , it was held that the said Institute was an authority within Article 12 being under the control of the Government of India, though it was registered under the Societies Registration Act. In this case the Institute had appointed its Director without any information or publicity in its various branches, which was necessary ac cording to bye-law. For that reason and also on account of the absence of material before the council for making proper selection, the Supreme Court quashed the appointment made to the post of Director. 57.
In this case the Institute had appointed its Director without any information or publicity in its various branches, which was necessary ac cording to bye-law. For that reason and also on account of the absence of material before the council for making proper selection, the Supreme Court quashed the appointment made to the post of Director. 57. This case, therefore, may also re late to employees' right to a particular post enjoined by the bye- law, which could not be exercised for arbitrary action over looking the provisions of the bye-law. 58. In 'consolidated Coffee Ltd. and another v. Coffee Board, Banglore', 1980 (3) SCC 358 , it has been held that Coffee Board was an authority within the meaning of Article 12. In this case rights of foreign buyers claimed by them with reference to circular issued by the Coffee Board requiring contingency deposits and bank guarantees were held unnecessary. In fact, the Coffee Board was directed to issue fresh circular. This, therefore, is a case where third party's rights were being con sidered vis-a-vis the Coffee Board, and, therefore, the relief was granted. 59. In 'som Prakash Rekhi v. Union of India and another', 1981 (1) SCC 449 , Bharat Petroleum Corporation was held to be an authority within Article 12. It has been held in this case that Article 12 is a special definition with a broader goal. Far from restricting the concept of State it enlarges the scope to embrace all authorities under the Control of Government. Any authority under the control of the Government of India comes within the definition of the State under Article 12. Authority in law belongs to the province of power. Authority in administrative law is a body having jurisdiction in certain matters of a public nature. Therefore, the ability conferred upon a person by the law to alter by his own will directed to that end, the rights, duties, liabilities or other legal relations, either of himself or of other persons must be present ab extra to make a person an authority. When the person in an 'agent or instrument of the functions of the State, the power is public. The true test is functional. Not how the legal person is born but why it is created.
When the person in an 'agent or instrument of the functions of the State, the power is public. The true test is functional. Not how the legal person is born but why it is created. Apart from discharging functions or doing business as the proxy of the State, wearing the corporate mask must be an element of ability to effect legal relations by virtue of powers vested in it by law. 60. In this case the petitioner was denied the pension as was allegedly due to him by erstwhile employer, Burmah Shell, which was taken over by Burmah Shell (Acquisition of Undertakings in India) Act, 1976 those rights being vested in Bharat Petroleum Corporation Limited, which is a Government Company. The pension and related benefits were connected in the instant case with other statutory obligations of erstwhile employer" such as employees, provident fund and gratuity etc. It was held that for the purpose of Part III of the Constitution such Corporation was a State. 61. In para 37 of the decision it has been held that "the conclusion is impeccable that if the corporate body is but an 'instrumentality or agency' of Government, then Part III will trammel its operations. "62. In para 38, however, it has been noticed in this case that "the decisions are not uniform as to whether being an instrumentality or agency of Government ipso jure renders the company or other similar body 'state'." With regard to decision in Sabhajit Tewary's case, it has been observed that "the laconic discussion and the limited ratio in Tewary hardly help either side here. However, for the purposes of adjudication of pensionary benefits claimed by the petitioner therein it has been observed in para 58 that "the justification for such deduction is claimed to be Regulation 16 and its antidote is urged to be a provision in the two respective enactments relating to provident fund and payment of gratuity, namely, Sections 12 and 14." 63. However, an important feature of this case is concurring judgment delivered by Hon'ble R.S. Pathak, J. (as his Lordship then was) wherein his Lordship has said that: "as regards the Burmah Shell (Acquisition of Undertakings of India) Act, 1976 I am unable to see any support for the proposition in the provisions of that Act. The provisions will apply to any Government Company and they do not alter the basic nature of that company.
The provisions will apply to any Government Company and they do not alter the basic nature of that company. They are provisions which could well have been applied to a private corporation, if the Act had selected one for vesting the undertaking in it. Would that have made the private Corporation a "state" ? On the merits of the petitioner's claim I need say no more than that I agree with my learned Brothers that the petitioner should be granted the relief proposed by them." 64. Inspite of best efforts, in no sub sequent decision any detailed discussion by Hon'ble R.S. Pathak, J. came to the notice of this Court, but none the less in recent times discussions about some other corporations which were sought to be covered by the doctrines enunciated by Article 12 of the Constitution of India have been made which are dealt with hereafter. 65. In 'Gujarat State Financial Corporation v. Mis. Lotus Hotels Pvt. Ltd'., 1983 (3) SCC 379 , it was held that State Financial Corporation was duty bound to grant sanctioned loan to Entrepreneur and if there is any arbitrary action, State Financial Corporation being an authority within Article 12, mandamus may issue. 66. It has been observed that "such corporation dealing with the public whether by way of giving jobs or entering into contracts or otherwise cannot act arbitrarily and its action must be in conformity with some principle which meets the test of reason and relevance. It may be pointed out that R.D. Shetty's case was made the basis in this judgment also and that is why it was held that such a authority was amenable to writ jurisdiction of the High Court. "67. In 'P.K. Ramchandra Iyer and others v. Union of India and others', 1984 (2) SCC 141 , it was held that Indian Council of Agricultural Research ('icar') was covered by the expression 'other authority' in Article 12, being instrumentality of the Central Government. This is a decision in which several writ petitions were simultaneously considered including S.L.Ps. from the High Court's orders and various reliefs to the Professors were granted be cause due pay scales to some of them or promotions to some of them and reconsideration of the cases by the 'icar' were not done in accordance with the resolution already taken. It may be mentioned here that 'icar' was only a registered society.
from the High Court's orders and various reliefs to the Professors were granted be cause due pay scales to some of them or promotions to some of them and reconsideration of the cases by the 'icar' were not done in accordance with the resolution already taken. It may be mentioned here that 'icar' was only a registered society. Reference in this case has been made to the decision in Ajay Hasia, R.D. Shetty and U.P. Ware Housing Corporation cases (supra). 68. In 'mis. Kasturi Lal Lakshmi Ready etc. v. THE State of Mannu and Kash mir', AIR 1980 SC 1992 , the State Governments' powers in granting largess was considered. Two limitations were noticed. First, the terms in which largess was to be granted. Second, the persons who may be the recipients of such largess. It has been held that unlike a private individual, State cannot act as it pleases and that every activity of the State has a public element in it and it must, therefore, be based on reasons and guided by public interest. If it fails to satisfy the test of reasonableness and public interest, the action would be unconstitutional and invalid. 69. In 'A.L. Kalra v. Project and Equipment Corporation of India Ltd'., 1984 (3) SCC 316 , it has been held that 'project and Equipment Corporation of India Ltd. ' falls within the expression "other authorities", hence, its employees are en titled to the protection under Part III though not Part XIV of the Constitution. It has been up held that Article 14 of the Constitution strikes at arbitrariness in the State action. In this case, it was held that since the order of dismissal as also the order of appellate authority approving the. dismissal order were not reasoned one and, therefore, the dismissal was held to be wholly arbitrary, being indicative of non-application of mind. The PEC Employees' (Conduct, Discipline and Appeal) Rules, 1975, which came up for interpretation in this case and the provisions therein were held to convey nothing but reasoned orders while dismissal of an employee was resorted to by the disciplinary authority. The order of removal was, therefore, quashed but the entire salary as claimed by the employee was held not payable on the facts of the case. 70.
The order of removal was, therefore, quashed but the entire salary as claimed by the employee was held not payable on the facts of the case. 70. In 'new Horizons Limited and another v. Union of India and others', 1995 (1) SCC 478 , distribution of State largesse was the subject matter of enquiry. It was held that Corporate veil should be seen through for this purpose. In this case contract for printing telephone directory came up for consideration and the decision taken by that ender Evaluation Committee was challenged on several arguments including discriminatory actions being hit by Article 14. Relying upon R.D. Shetty's case (supra) and Kasturi Lal's case (supra) it was held that action of the State in the matter of award of contract has to satisfy that this excludes arbitrariness and action is fair and reasonable. It may be pointed out that this was a cause where third party interest was being examined in view of provisions of Article 14. This case has relied upon the decision of Hon'ble Supreme Court in 'tata Cellular v. Union of India', 1994 (6) SCC 651 . It has been held in Tata Cellular (supra) that it is open to the Court to review the decision maker's evaluation of the facts. The Court will intervene where the facts taken as a whole could not logically warrant the conclusion of the decision maker. If the weight of facts pointing to one course of action is overwhelming, then a decision the other way, cannot be upheld. It was further held that a decision would be regarded as un reasonable if it is impartial and unequal in its operation as between different classes. 71. In 'air India and others v. B.R. Age and others', 1995 (6) SCC 359 , it was held that directions issued by the Central Government relating to reservation of scheduled castes/scheduled tribes candidates were to apply-because Section 7 of the said enactment would not cover such functions, because it is the Corporation which has power to regulate conditions of service of the employees. However, whether or not Air India Corporation is a State within the meaning of Article 12 of the Constitution was left open, though Central Government directives were held to be followed for the purpose. 72.
However, whether or not Air India Corporation is a State within the meaning of Article 12 of the Constitution was left open, though Central Government directives were held to be followed for the purpose. 72. This is how the Hon'ble Supreme Court has dealt with various cases which raise question of a society, corporation, company, or undertaking to be State or Authority within the meaning of Article 12. An Analysis of all the case laws discussed above leave no manner of doubt that the entire field covered by those decisions can be divided into three distinct sets as detailed below. 73. First, wherever, State or Authority, i.e. corporation, society, company or undertaking has been found to be dealing with contract or agreement with third party, i.e. by auction, negotiation or advertisement, it may give rise to third party's Fundamental Rights if that action is arbitrary, unfair and partisan etc. (See R.D. Shetty, Kasturi Lal, ONGC, Gujarat SFC, Coffee Board, Tata Cellular and New Horizons cases (supra). 74. Second, wherever, State or Authority, i.e. corporation, society, company or undertaking is found to be obliged to follow certain procedure relating to any benefit extendable to an employee under any law or enactment and if action of the State or Authority is adjudged as contravening those laws and enactments, writ jurisdiction may have to be exercised to correct it. (See Som Prakash, Takraj Vasandi, P.K. Ramchctndra, A.L. Karla etc. (supra). 75. Third, wherever, State or Authority, i.e. corporation, society, company or undertaking has been found to be dealing strictly in accordance with the con tract of the employment and the alleged action is not traceable in any other law or enactment, but remains confined only to the terms of contract of employment, recourse to writ jurisdiction under Articles 226 or 32 of the Constitution has been held to be not available and in a given case such employee or workman or officer may challenge such action under the civil, industrial or labour law, which ever is attracted. (See Sabhajit Tewari, All India Sainik School, B.S. Minhas, Makhan Lal Matooetc. cases (supra). 76. Having thus examined the three categories to which any of the case laws may be attracted, a categorical finding has to be recorded here that the case of the petitioners is not covered by any of those decisions in which relief may have been granted.
(See Sabhajit Tewari, All India Sainik School, B.S. Minhas, Makhan Lal Matooetc. cases (supra). 76. Having thus examined the three categories to which any of the case laws may be attracted, a categorical finding has to be recorded here that the case of the petitioners is not covered by any of those decisions in which relief may have been granted. Admittedly, the petitioners are not third party and admittedly there is no law or enactment which requires the FCI to enhance their retiring age. Every petitioner knows his terms of employment. The decision of Board of Directors to retire them at the age of 58 years is a part of the contract subsisting between the petitioner on one hand and FCI on the other. Unless, therefore, it can be held that the FCI is bound to follow the Government's decision vis-a-vis the Government employees, the petitioners cannot have any success in these petitions. 77. Few examples may be pointed out here that will demonstrate the futile at tempt of the petitioners to invoke Articles 14 and 16 of the Constitution for the reliefs claimed in these petitions. Can the State Government employees, who have always to be treated working in the State, raise the plea of enhancement of retirement age only because the retiring age of Central Government employees is higher? The answer has to be always in the negative. Can one set of employees working under public sector, undertaking or company or corporation claim enhancement in their retiring age only because another set of employees working in the same company, corporation or undertaking has that enhanced age or retirement ? Again the answer has to be in the negative. 78. It was, therefore, rightly pointed out by Sri Bhatnagar that choice given to FCI is absolute in the sense that Board of Directors can adopt or not adopt enhancement in the retiring age as has been notified by the Central Government for its employees. THE Board of Directors of FCI have already expressed their inability to enhance the age of any of the petitioner or like for various reasons.
THE Board of Directors of FCI have already expressed their inability to enhance the age of any of the petitioner or like for various reasons. They have also resolved to have exemption from Central Government for which suitable letters have been issued by the FCI to the Central Government Hon'ble M.C. Agrawal, J. has already held that the letters issued by the Central Government so far to the FCI in this regard do not have the effect of becoming directives of the Central Government to a public sector undertaking, but at the best indicate some guidelines and, therefore, are not binding. 79. It may be noted here in this connection that being a Government Company the FCI will be bound to follow the orders of the Central Government, which are meant to be followed by it. It is obvious, therefore, that wherever the FCI has been left an option to examine the facts and circumstances and then decide whether or not to obey the policies which have been adopted by the Central Government concerning its employees, the Board of Directors will be fully competent to claim exemption. 80. In the instant case, the FCI on record to have refused to enhance the retirement age of the petitioners and consequently, the petitioners do not possess any fruitful right to gel a mandamus issued against FCI for enhancing their retirement age. Hon'ble M.C. Agrawal, J. has rightly pointed out the pathetic financial condition of FCI for which it has offered schemes for golder-shake-hands with its employees because crores and crores are being incurred as loss for which one of the reasons attributed is over staffing. 81. Before the curtain is drawn, this Court may advert to three decisions of the Hon'ble Supreme Court. In the case of Union Territory Chandigarh v. Krishna Bhandari, (1996) 11 SCC 348 , the Apex Court has held that the doctrine of equal pay for equal work is inapplicable when different pay scales exist between employees of two different authorities under Article 12. In the case of Associate Bank Officer v. State Bank of India, AIR 1998 SC 32 , it has been held that medical facilities or other benefits cannot be claimed by Associated Banks' employees just because State Bank of India employees get it.
In the case of Associate Bank Officer v. State Bank of India, AIR 1998 SC 32 , it has been held that medical facilities or other benefits cannot be claimed by Associated Banks' employees just because State Bank of India employees get it. It has been held that contract of employment will not permit this claim on the supposed applicability of 'equal pay for equal work 'in the case of A". Knshnamacharyulu, AIR 1998 SC 295 , it has been held that where the Government has issued instructions about pay parity in educational institutions, even private schools will have to abide by the same. 82. In view of these three decisions, the petitioners cannot contend that age parity should come to them by a mandamus by this Court under Article 226 of the Constitution. It is dependant only on the specific directive of the Government of India that the petitioners ages can enhance or else they have to retire at the ages stipulated by their contract of employment. 83. In view of the aforesaid discussion, all the writ petitions must fail. The parties will bear their costs. Petitions dismissed.