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1998 DIGILAW 542 (KAR)

M. G. KARUPPAIAH v. CANTEEN OFFICER (AQMG) HEADQUARTERS, KARNATAKA AND GOA SUB-AREA, BANGALORE

1998-08-13

H.L.DATTU

body1998
( 1 ) PETITIONER was working as a salesman in the Karnataka and Goa sub-area Canteen (for short, 'canteen' ). By the impugned order dated 15-2-1993, his services were terminated by the Canteen Officer, Bangalore. It is the correctness or otherwise of this order, which is questioned in this petition filed under Article 226 of the Constitution on the sole ground that the impugned order could not have been passed without holding an enquiry. Therefore, the order is bad, illegal, arbitrary and violative of Article 14 of the Constitution. ( 2 ) RESPONDENTS, besides contesting the petition on merits, have raised a preliminary objection as to the maintainability of the petition and it is specifically asserted that the Canteen is not the instrumentality of the state falling within the ambit of Article 12 of the Constitution and not 'other authority' used in Article 226 of the Constitution. In support of the contention they strongly rely upon the observations made by learned single Judge of Punjab and Haryana High Court in the case of sarasamma v Union of India and Others. Their learned counsel while reiterating the objections filed, relies upon the dicta of the Supreme court in Ajay Hasia v Khalid Mujib Sehravardi and Others and in chander Mohan Sharma v National Council of Educational Research and Training and Others. ( 3 ) PER contra Sri Narayana Swamy, the learned Counsel for petitioner submits that the respondent-Canteen is a 'state' coming within the ambit of Article 12 of the Constitution, solely on the ground that the canteen is run in terms of the Army Order 709 of 1951 and the General policy for the administration of the Canteen will be drawn by the chairman who is none other than the Army Commandant of the Sub-area. Secondly, he submits that the Canteen is run in organised lines in accordance with the rules, orders, instructions received from Headquarters from time to time. Lastly, he asserts since all the appointments to the Canteen is made by the Chairman, the Central Government has absolute control over the administration of the Canteen and therefore, the respondent-Canteen would come within the expression 'state' in article 12 of the Constitution. On the merits of the case, he submits, since petitioner's services are terminated without even holding a summary enquiry, the order is bad and illegal. On the merits of the case, he submits, since petitioner's services are terminated without even holding a summary enquiry, the order is bad and illegal. ( 4 ) THE primary question that requires to be considered and decided is whether the respondent-Canteen is a 'state' coming within the ambit of article 12 of the Constitution or 'other authority' as envisaged under article 226 of the Constitution and whether the respondent-Canteen is amenable to writ jurisdiction of this Court? Normally, the discussion would begin in such matters from Ajay Hasia's case, supra, Constitution bench of the Supreme Court while considering the question as to whether a Society registered under the Societies Registration Act could be a State within the meaning of Article 12 has culled out six tests from an earlier decision in Ramana Dayaram Shetty v International Airport authority of India and Others. They are as under: "one thing is clear that if the entire share capital of the corporation is held by the Government it would go a long way towards indicating that the Corporation is an instrumentality or agency of the Government. Where the financial assistance of the State is so much as to meet almost entire expenditure of the Corporation, it would afford some indication of the Corporation being impregnated with governmental character. It may also be a relevant factor whether the Corporation enjoys monopoly status which is State conferred or State protected. Existence of deep and pervasive State control may afford an indication that a corporation is a State agency or instrumentality. 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 instrumentality or agency of the Government. 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". ( 5 ) IN Chander Mohan Sharma's case, supra, the Apex Court while considering the question as to whether National Council of Educational research and Training is a State as defined under Article 12 of the constitution was pleased to lay down certain principles to determine whether a body is an instrumentality or agency of the Government. The court was pleased to observe:"2. The court was pleased to observe:"2. These are only general principles but not exhaustive test to determine whether a body is an instrumentality or agency of the government. Even in general principles, there is no cut and dried formula which would provide correct division of bodies into those which are instrumentalities or agencies of the Government and those which are not. The powers, functions, finances and control of the Government are some of the indicating factors to answer the question whether a body is a "state" or not. Each case should be handled with care and caution. Where the financial assistance from the State is so much as to meet almost entire expenditure of the institution, or the share capital of the corporation is completely held by the Government, it would afford some indication of the body being impregnated with governmental character. It may be a relevant factor if the institution or the corporation enjoys monopoly status which is State conferred or state protected. Existence of deep and pervasive State control may afford an indication. If the functions of the institution are of public importance and related to governmental functions, it would also be a relevant factor. These are merely indicative indicia and are by no means conclusive or clinching in any case. 3. Article 12 should not be stretched so as to bring in every autonomous body which has some nexus with the Government within the sweep of the expression "state". A wide enlargement of the meaning must be tempered by a wise limitation. It must not be lost sight of that in the modern concept of Welfare State, independent institution, corporation and agency are generally subject to State control. The State control does not render such bodies as "state" under Article 12. The State control, however vast and pervasive, is not determinative. The financial contribution by the State is also not conclusive. The combination of State aid coupled with an unusual degree of control over the management and policies of the body, and rendering of an important public service being the obligatory functions of the State may largely point out that the body is "state". If the Government operates behind a corporate veil, carrying out governmental activity and governmental functions of vital public importance, there may be little difficulty in identifying the body as "state" within the meaning of Article 12 of the Constitution". If the Government operates behind a corporate veil, carrying out governmental activity and governmental functions of vital public importance, there may be little difficulty in identifying the body as "state" within the meaning of Article 12 of the Constitution". ( 6 ) IN All India Sainik Schools Employees Association v Defence minis-ter-cum-Chairman, Board of Governors of Sainik School Society, New delhi, the Apex Court was pleased to observe that since the entire funding for the Sainik School Society is by the State Government and central Government, since the overall control vests in the Government authority and since the main object of the Society is to run schools and prepare students for the purpose of feeding the National Defence academy and Defence of the country being one of the legal functions of the state, it was held that the Society was amenable to writ jurisdiction and was 'state' within the meaning of Article 12 of the Constitution. ( 7 ) IN Shri Anadi Mukta Sadguru Shree Muktajee Vandasjiswami suvarna Jayanti Mahotsav Smarak Trust and Others v V. R. Rudani and Others, highlighted the distinction of an 'authority' for the purpose of Article 226 of the Constitution and the Court was pleased to observe: "the term "authority" used in Article 226, in the context, must receive a liberal meaning unlike the term in Article 12. Article 12 is relevant only for the purpose of enforcement of fundamental rights under Article 32. Article 226 confers power on the High courts to issue writs for enforcement of the fundamental rights as well as non-fundamental rights. The words "any person or authority" used in Article 226 are, therefore, not to be confined only to statutory authorities and instrumentalities of the State. They may cover any other person or body performing public duty. The form of the body concerned is not very much relevant. What is relevant is the nature of the duty imposed on the body. The duty must be judged in the light of positive obligation owed by the person or authority to the affected party. No matter by what means the duty is imposed. If a positive obligation exists mandamus cannot be denied". ( 8 ) KEEPING in view these well established general principles and tests laid down by Apex Court to determine whether a body is an instrumentality of the Government, let me briefly notice the object and purpose of the respondent-Canteen. No matter by what means the duty is imposed. If a positive obligation exists mandamus cannot be denied". ( 8 ) KEEPING in view these well established general principles and tests laid down by Apex Court to determine whether a body is an instrumentality of the Government, let me briefly notice the object and purpose of the respondent-Canteen. ( 9 ) THE Canteen has its Standing Orders. The Canteen is run in terms of Army Order 709 of 1951. The said Army Order provides policy regarding canteens. The same is extracted and it reads as under: a. O. 709/51 - Policy Regarding Canteens. As a general policy, the retail sales of canteen stores now undertaken by approved army contractors will gradually be conducted as under: (A) units themselves will run their own canteens and replace unit contractors. (b) station contracts will be taken over (i) in small stations by a major (static) unit. (ii) in big stations by local formation or station HQ. This policy has been initiated with a view to. (a) avoiding the middleman's profit and providing canteen goods at cheaper prices; (b) ensuring more efficient canteen services to the troops; and (c) providing additional amenities to the troops from the increased profits that would thus accrue. 3. In implementing this policy, units will Not employ the services of a contractor in any way whatsoever, Nor will free government transport be used in the running of these canteens. In Jammu and Kashmir, however, the use of free Government transport is permissible. 4. For overall supervision of these canteens, units will detail an officer and also ensure that the accounts are audited quarterly by the Regimental Audit Board: 5. Unit-run canteens are authorised to obtain canteen stores including liquor/beer, at wholesale rates, when stores are drawn direct from CSD (I) Depots. If however, they are drawn through a station contractor, they will be available at wholesale rates plus one per cent commission, in addition to actual handling charges and octroi duty where levied. These goods are retailable strictly at the retail rates laid down from time to time in the CSD (I)'s Retail price Lists. The margin of profit between the wholesale and retail prices is enough to enable these canteens to make a reasonable net profit, after meeting their overheads. 6. These goods are retailable strictly at the retail rates laid down from time to time in the CSD (I)'s Retail price Lists. The margin of profit between the wholesale and retail prices is enough to enable these canteens to make a reasonable net profit, after meeting their overheads. 6. Units will try to engage as many of the present personnel employed by the contractors, if they are displaced persons. This is to avoid hardship to a large number of displaced personnel now employed by canteen contractors. In making new appointments, units will employ ex- servicemen. 7. A number of contractors are also displaced persons, having entered India from Western/eastern Pakistan, as a result of the partition of the country, and have invested their only savings in the canteen trade. In order to avoid hardship to these, units may give them a reasonable period in which to recover their investment and make arrangements to commence some other business. 8. In replacing contractors, units will adhere strictly to the rules and terms of contract and give contractors due notice as laid down in the terms. 9. There are now 1200 unit canteens, of which about 250 are run by units themselves. It is hoped that, in another three months, a good proportion of these will be taken over by units themselves. 10. It is appreciated that many small units will Not be able to take over their canteens as they will Not have sufficient funds to do so. The Canteen Stores Department (India) is Not in a position to advance them funds and it is suggested that units borrow the money required through their own resources. 11. As an experimental measure, the Canteen Stores department (India) will arrange to take over canteens in one or two selected stations, where they are able to supervise them. The aim is to gradually extend this policy so that eventually the canteen Stores Department (India) take over all station canteens which are Not taken over by formation or station headquarters. This will result in a large number of personnel being trained in canteen work, and so available, in time of war, to form canteen teams to run and organise canteens in forward areas. This will result in a large number of personnel being trained in canteen work, and so available, in time of war, to form canteen teams to run and organise canteens in forward areas. All such personnel will, as far as possible, be ex/csd (I) employees or ex-servicemen, and all personnel employed either by units, formation headquarters or the CSD (I) will be required to give an undertaking to serve in operational areas, if and when necessary. 12. With the implementation of the above policy, it is hoped that, by the end of 1952, all canteens of major units, static installations and training centres and all station canteens will be taken over from contractors, except for those who are employing displaced contractors". ( 10 ) HAVING noticed the Army Order, by which respondent-Canteen is constituted, let me notice the aim and general administration of respondent-Canteen. The aim of the Canteen seems to provide canteen facilities to the serving Army Personnel which include Air Force and Navy officer, retired Army Personnel, separated families in the station, widows of Army Personnel, etc. Nextly, the policy for general administration including appointments, terms of conditions of service etc. , will be laid down by the Commander, Karnataka Sub-Area. ( 11 ) HAVING noticed, the constitution, the objects and purpose of respondent-Canteen, let me now advert to the question raised by me for answer earlier. The respondent-Canteen is constituted under the Army order 709/51, not under any statute or rules. The Canteen is run by unit heads of the Army instead of private contractors. All the employees are private individuals. There is no control over the administration by central Government. The object of the Canteen is to provide canteen facilities only to Army Personnel not to the public at large. The unit is required to employ its own personnel for running its establishment and running of it also by its own funds or borrow money required through its own resources. Now applying the tests laid down in Ajay Hasia's case, supra, and other decisions noticed above, it is not at all possible to hold that respondent-Canteen can be termed as the instrumentality of the state, so as to bring it within the term "other authority" under Article 12 of the Constitution. Now applying the tests laid down in Ajay Hasia's case, supra, and other decisions noticed above, it is not at all possible to hold that respondent-Canteen can be termed as the instrumentality of the state, so as to bring it within the term "other authority" under Article 12 of the Constitution. ( 12 ) THE question to be considered now would be as to whether, in the light of the decision in Rudani's case, supra, it will be permissible and appropriate to issue writ of mandamus. The Apex Court in Rudani's case, supra, laid stress on the nature of duties imposed upon the body or on the functions being discharged by the body and not on the form of body. In case the nature of the duty being discharged can be said to be of a public nature, the Court has held that the mandamus cannot be denied on the ground that the duty to be discharged is not imposed by the statute, since mandamus is of very wide amplitude which must be easily available to reach injustice wherever it is found. Technicalities should not come in the way of granting relief under Article 226 of the Constitution. Judicial control over the vast expanding maze of bodies affecting the rights of the people should not be put into water tight compartment. In the instant case, there is nothing on record even to suggest, even though the respondent-Canteen is a private body, it has been constituted with the aim and object of performing public duty. In my opinion, since the Central Government has no administrative control and no finances are made available and since the respondent-Canteen has no public duty to perform no mandamus can be issued to the respondent-Canteen to reinstate the petitioner into service with effect from the date of termination with all consequential service and monetary benefits. ( 13 ) NOW coming to the merits of the case, petitioner is seeking an order to quash the order of termination dated 15-2-1993 passed by 1st respondent and further for a direction to reinstate him into service, solely on the ground, that the impugned order is violative of principles of natural justice, having been passed without holding any enquiry. ( 13 ) NOW coming to the merits of the case, petitioner is seeking an order to quash the order of termination dated 15-2-1993 passed by 1st respondent and further for a direction to reinstate him into service, solely on the ground, that the impugned order is violative of principles of natural justice, having been passed without holding any enquiry. In my view, since petitioner is seeking to enforce private contract against a private organisation, even if it is found that the impugned order is wrongful, no order could be made which might have the effect of reinstatement into service, since the dismissed employee would be entitled to claim a decree for damages before an appropriate forum. ( 14 ) IN the result, petition deserves to be dismissed. Accordingly, it is dismissed as respondent-Canteen is not amenable to writ jurisdiction. In the facts and circumstances of the case, parties are directed to bear their own costs. Ordered accordingly. --- *** --- .