Judgment :- Challenge in these Writ Petitions are G.O. (Ms) No.1 R.D. & P.R. dated 02.01.2007 stipulating that Kattida Maiyam should participate as an equal agency in all tender activities. .2. Factual background in nutshell are as follows:- .District Building Centres in each District in Tamilnadu have been established through the H & U.D. Dept. in G.O .Rt. No. 475 H & U.D. Dept. dated 011. 1990 with the District Collector as its Chairman and the Project Officer, DRDA as its member Secretary. There is a governing body constituted by district level officials, representatives of H & U.D. Dept. , Anna University and Lead Bank etc., as its members to govern the activities of the Building Centres. Building Centres were established to promote low cost technology and with the usage of having local knowledge of local labour through low cost technologies, training programmes of its workman in cost effective building technologies, marketing of low cost construction materials etc., for the benefit of the people in the Districts. Kattida Maiyam carried out certain construction activities under nomination method. 3. In 1998, Government passed Tamilnadu Transparency in Tenders Act which provides that all procurements by the Government must only be by way of tender. Sec.3 makes this mandatory. Sections 9 and 10 provide for the mechanism of the tender process. Sec.16 provides for exception to the applicability of the Act. .4. To set right certain anomaly in the functioning of Kattida Maiyams and clarifying the procedure, Government issued G.O.Ms.No.1 R.D. & P.R. (SGS-3) Department dated 1. 2007 wherein it was reiterated that Kattida Maiyam should participate as an equal agency in all tender activities. As per the above G.O. the practice of awarding the contracts to Kattidea Maiyam on a nomination basis was asked to be strictly avoided. 5. Grievance of the Petitioners is that as per G.O.Ms.No.1 R.D. & P.R. dated 02.01.2007, Kattida Maiyams administered by District Collector and Project Officer, DRDA are not allowed to get the nominated works and they are permitted only to participate in the tender. Case of the Petitioners is that as per G.O.Rt.No.475 H & U.D. Dept. dated 011. 1990, all the District Building Centres are formed and registered as Government Societies under the Tamilnadu Societies Registration Act, 1975 functioning under the Chairmanship of District Collector and Project Officer, DRDA as its Member Secretary and other District officials as members. Case of the Petitioners is that as per G.O.Rt.No.475 H & U.D. Dept. dated 011. 1990, all the District Building Centres are formed and registered as Government Societies under the Tamilnadu Societies Registration Act, 1975 functioning under the Chairmanship of District Collector and Project Officer, DRDA as its Member Secretary and other District officials as members. According to the Petitioners when Building Centres carry out work on nomination, the Government is merely implementing its own scheme departmentally and therefore such actitivity will not constitute "Procurement" within the meaning of Section 2 Clause 3 of the Act and therefore the said Act does not apply to Kattida Maiyams in Tamilnadu and therefore, the entire rationale behind the impugned G.O. is illegal and liable to be quashed. Petitioner further alleged that since the estimate of work which is undertaken by Kattida Maiyam are sanctioned by District administration, there is no likelihood of any unjust enrichment and irregularities. It is further alleged that the G.O. not only stops all further execution of works through Building Centres, but also authoriseS to cancel all the works not yet commenced as on the date of G.O. which is arbitrary and unconstitutional. 6. Respondents filed counter stating that working of Kattida Maiyams led to certain irregularities relating to execution and to clarify the Government procedure, G.O.Ms.No.1 R.D. & P.R. Department dated 02.01.2007 was passed. According to the Respondents, entire exercise is done to ensure that Kattida Maiyams work with proper financial discipline and are made to adopt low cost building technology. Entire exercise of KattIda Maiyam going through the tendering process is actually to enable the Building Centres achieve their aim of propagating low cost technology with proper financial discipline and to dissuade the Kattida Maiyam from becoming a device for awarding works to surrogate contractors without going through the tender process. 7. Mr. Vijay Naraian, learned Senior Counsel appearing for the Petitioner in W.P.No.7834/2007 has submitted that if Kattida Maiyams are to participate in the tender process, they have to satisfy certain parameters and the very object of Kattida Maiyams to promote low cost technology with the usage of locally available materials would be defeated. 7. Mr. Vijay Naraian, learned Senior Counsel appearing for the Petitioner in W.P.No.7834/2007 has submitted that if Kattida Maiyams are to participate in the tender process, they have to satisfy certain parameters and the very object of Kattida Maiyams to promote low cost technology with the usage of locally available materials would be defeated. Learned Senior Counsel further submitted that Sec.16(c) of Tamil Nadu Transparency in Tenders Act, 1998 (for short Act) makes exemption for a period of 11 years in respect of certain departments, public sectors and statutory bodies and other such institutions and Kattida maiyams would fall within the ambit of "other institutions". Learned Senior Counsel further argued that when the District Collector is the Ex-officio Chairman of the District Building Centre and as the co-ordination authority is the DRDA, a Government body, it cannot be made to compete with other contractors in the tender process. Learned Senior Counsel would also submit that the impugned G.O. is arbitrary and unconstitutional as if not only stops the execution of works through Building Centres, but also authorise to cancel all the works not commenced as on the date of G.O. 8. Contending that procurement from Kattida Maiyam is not covered under the Act 43/1998, Mr.Srinath Sridevan, learned counsel appearing for the Petitioner in W.P.No.2096/2007 has submitted even assuming that Act 43/1998 is applicable, the impugned G.O. is irrational and passed without application of mind. Learned counsel for the Petitioner further urged that the impugned G.O. being an executive order can be quashed on the ground of non-application of mind and unreasonableness. It was also argued that when Kattida Maiyams take work, necessary transparency already exists and there is no question of further transparency. 9. Mr.P.S.Raman, the learned Additional Advocate General – I firstly submitted that Petitioners are not Kattida Maiyams established under G.O.Rt.No.475, H & U.D. Dept. , dated 011. 1990 and are only society formed by some of the Engineers. Elaborating upon the irregularities in execution of work by Kattida Maiyams, learned Additional Advocate General has submitted that entire exercise is done only to ensure that Kattida Maiyams work with efficiency and transparency by making it to participate in the tender process. Learned Addl. Advocate General further contended that the main object of G.O. Ms.No.1 dated 01. 2007 is only to prevent the abuse of process by private individuals and there is nothing to show that it is unreasonable. Learned Addl. Advocate General further contended that the main object of G.O. Ms.No.1 dated 01. 2007 is only to prevent the abuse of process by private individuals and there is nothing to show that it is unreasonable. Placing reliance upon 2005 (2) CTC 321 [A.Joseph Louis v. The District Welfare Fund Committee, rep. by its President, the District Collector, Trichy-1 and others], it was contended that the society is not "other authority" covered under Article 12 of Constitution of India. 10. Each Kattida Maiyam (Building Centres) is registered under the Tamil Nadu Societies Registration Act 1975 (Tamil Nadu Act 27/1975) and the District Collector is the Chairman and the Project Officer, District Rural Development Agency is its Member Secretary. There is a governing body constituted at the district level with representatives from District Officials, Housing Urban Development Corporation, Lead Bank and other departments as its Members. The Project Engineer of the Kattida Maiyams is responsible for executing the schemes and projects of Kattida Maiyam. He is in-charge of preparation of estimates, procurement of materials, execution and recording of measurements, preparation of bills and making payments. The Project Engineer is appointed by the Chairman of Kattida Maiyam i.e. District Collector and he is in-charge of the execution of projects. 11. Contention of the Petitioners is that since all the estimate of work undertaken by Kattida Maiyam are sanctioned by the District Collector, there is no likelihood of any unjust enrichment or irregularities and the impugned G.O. stopping all further execution of works and also purporting to cancel all works not yet commenced on the date of G.O. is arbitrary and unreasonable. Kattida Maiyams established under G.O.Rt.No.475 H & U.D. Dept. , dated 011. 1990 in District Headquarters are registered under Tamil Nadu Societies Registration Act, 1975. For instance, Kattida Maiyams, Salem was registered in S.No.148/1990. 12. For those Kattida Maiyams established as per G.O.Rt.No.475 H & U.D. Dept., dated 011. 1990, administration and management of affairs of Maiyam shall vest in a Governing body. It is pertinent to note that Petitioner in W.P.No.7834/2007 is not a Building Centre established under G.O.Rt.No.475 H & U.D. Dept., dated 011. 1990. But said to have been formed by some of the Engineers who were receiving the work and registered under the name Tamil Nadu Kattida Maiya Poriyalarkal Sangam, registration No.186/96. It is pertinent to note that Petitioner in W.P.No.7834/2007 is not a Building Centre established under G.O.Rt.No.475 H & U.D. Dept., dated 011. 1990. But said to have been formed by some of the Engineers who were receiving the work and registered under the name Tamil Nadu Kattida Maiya Poriyalarkal Sangam, registration No.186/96. Petitioner in W.P.No.2096/2007 claims to be the Secretary of Tamil Nadu Building Workers Association, Tiruvannamalai. It is to be kept in view that none of Kattida Maiyams established under G.O.Rt.No.475 H & U.D. Dept. , dated 011. 1990 have complained of the impugned G.O.Ms.No.1 R.D. & P.R., dated 01. 2007 nor expressed any grievance. 13. Kattida Maiyams established as per G.O.Rt.No.475 H & U.D. Dept. , dated 011. 1990, administration and management of affairs of Maiyam shall vest in a Governing body of which the members shal be:- District Collector, Project Officer DRDA, Sub-Collector/RDO, Executive Engineer of TNHB, TNSCB and other District Level Officers. 14. Learned Senior Counsel for the Petitioner would submit that when such well responsible persons are the members of Governing body and Kattida Maiyams are well functionong with District Collector as Chairman, there was no necessity to bring Kattida Maiyams under the purview of Tamil Nadu Transparency in Tenders Act, 1998. It was further argued that when the District Collector is the Chairman, Government is merely implementing its own scheme departmentally. Learned Senior Counsel further argued that Collector being the Chairman cannot be a participant in the tender process in his capacity of Chairman of the Building Centre which would only be absurd and meaningless. Even though, District Collector is the Chairman of Governing body of Kattida Maiyam, the day today work including preparation of estimates, execution of works are done by Project Engineers. From the functioning of Kattida Maiyam, it appears that Project Engineer is the only one official who does all the works himself, i.e., from preparation of estimates to procurement of building materials etc. A lot of technical and financial power was given to a single source and that for undertaking conventional works which according to the Government had many disadvantages. 15. Learned Additional Advocate General would submit that in the impugned G.O.Ms.No.1 R.D. & P.R. Department dated 01. A lot of technical and financial power was given to a single source and that for undertaking conventional works which according to the Government had many disadvantages. 15. Learned Additional Advocate General would submit that in the impugned G.O.Ms.No.1 R.D. & P.R. Department dated 01. 2007, it is clearly stated that a large number of vigilance and disciplinary cases are pending in the Rural Development Department and that Kattida Maiyams cannot be allowed to become a device for awarding works to surrogate contractors. When the disadvantages in functioning of Kattida Maiyams are clearly spelt out in the impugned G.O., the rationale passing G.O. cannot be challenged. 16. Sec.16 (c) of the Act provides for exemption of certain agencies from the purview of Act 43/1998. Sec.16 (c) of the Act exempts certain departments of Government, Public Sector Undertakings, Statutory Boards and such other institutions from the purview of participation in the tender process as envisaged in the Act. Sec.16 (c) reads thus:- "..... (c) from certain departments of Government, public sector undertakings, statutory boards and such other institutions only in respect of goods manufactured or services provided by them for a period not exceeding (eleven years) from the date of commencement of this Act; 17. Learned Senior counsel has submitted that the entities "other institutions" should be construed as ejusdem generis. It was further argued that Kattida Maiyam under Chairmanship of District Collector and co-ordination authority being DRDA, the Governing body and members of Governing body are the Districct level officials, Kattida Maiyams are to be construed as "other institutions". Learned Senior counsel would further submit that Kattida Maiyams being registered under Societies Registration Act are to be treated as other institutions and Act 43/1998 cannot apply to Kattida Maiyams in Tamil Nadu. 18. In response, learned Additional Advocate General would submit that society is not other institutions falling within the ambit of Article 12 of Constitution of India. In support of his contention, the learned Additional Advocate General placed reliance upon 2005 (2) CTC 321 [A.Joseph Louis v. The District Welfare Fund Committee, rep. by its President, the District Collector, Trichy-1 and others]. In the said case, question before the Full Bench is whether or not the District Welfare Fund Committee registered under Societies Registration Act is "State". In support of his contention, the learned Additional Advocate General placed reliance upon 2005 (2) CTC 321 [A.Joseph Louis v. The District Welfare Fund Committee, rep. by its President, the District Collector, Trichy-1 and others]. In the said case, question before the Full Bench is whether or not the District Welfare Fund Committee registered under Societies Registration Act is "State". District Welfare Fund Committee was started as informal and unregistered Association of persons and several Government officials in succession organized several programmes and the surplus collections were given to the said Association. Society was not discharging any public duty. Referring to various decisions and observing that society is not "Authority" or "State" as defined in Article 12 of Constitution of India, Full Bench has held as under:- "25. After a careful analysis of the above discussion, we are of the view that whether a body is a State as defined under Article 12 of the Constitution will have to be determined by applying the tests laid down in Pradeep Kumar Biswass case, 2002 (5) SCC 111 . The multiple test laid down therein is whether in the light of cumulative facts as established the body is financially, functionally and administratively dominated by or under the control of the Government. When the control is merely regulatory whether under statute or otherwise, it would not serve to make the body a State. The control must be deep and pervasive. In Zee Telefilms v. Union of India 2005 (1) Scale 666 the Honble Supreme court in the penultimate paragraph of the judgment of the majority has been pleased to hold that the decision in Sukhdev Singhs case 1975 (3) SCR 619 expanding the definition of the terms "other authorities" to include bodies other than statutory bodies was given in the context of the situation prevailing at that time. They further held that in view of the present socio-economic policy of the Government where the State is distancing itself from commercial activities and concentrating on governance, it has been held that there is no necessity to further expand the scope of the term "other authorities" occurring in Article 12 of the Constitution." "26. In cases where the body has been held to be an autority under Article 12, the Government invariably has had the power to control the functioning of the body by issuing directions, controlling expenditure, etc. In cases where the body has been held to be an autority under Article 12, the Government invariably has had the power to control the functioning of the body by issuing directions, controlling expenditure, etc. In Pradeep Biswass case (supra), the Council of Scientific and Industrial Research (CSIR) was held to be a State on the basis that it was set up by the Department of Commerce, Government of India, to carry on activities earlier done by Department of Commerce. It was set up in the national interest to further the economic welfare of society by fostering planned industrial development. The Prime Minister is its ex officio President. Its Director General is appointed by the Government of India. The power to frame, amend or repeal bye-laws can be done only with the sanction of Government of India All decisions can be reviewed by the Prime Minister and his orders are binding on governing body, As far as the employees of CSIR are concerned, the Central Civil Services (Classification, Control and Appeal) Rules and the Central Civil Services (Conduct) Rules are applicable to them. The scales of pay applicable to all the employees of CSIR are those prescribed by Government of India for similar personnel. CSIR cannot lay down or change the terms and conditions of service of its employees and any alteration in the bye-laws can be carried out only with the approval of the Government of India. Initial capital as well as 70 per cent of the funds have been provided by Government of India. The Government of India can impose limitation on expenditure. The accounts of CSIR are required to be audited by the Comptroller and Auditor General and placed before the Parliament. In the event of dissolution, the assets of the CSIR shall have to be dealt with in the manner determined by the Government. "27. ....... As ruled in G.Bassi Reddy v. International Crops Research Institute, AIR 2003 SC 1764 (supra), although, it is not easy to define what a public function or public duty is, it can reasonably be said that such functions are similar to or closely related to those performable by the State in its sovereign capacity. We are satisfied that the Committee is not discharging or conducting State functions and the Government has no pervasive control much less regulatory control over the Society." "28. We are satisfied that the Committee is not discharging or conducting State functions and the Government has no pervasive control much less regulatory control over the Society." "28. In the light of our discussion, we hold that the first respondent Society is not an Authority or State as defined in Article 12 of the Constitution of India. It is also not a "Body or instrumentality" as could be made amenable to writ jurisdiction under Article 226 of Constitution of India; hence the Writ Petition filed against it is not maintainable." 19. In the present case, though, District Collector is the Chairman of Kattida Maiyam, it is the Project Engineer who prepares estimate and procurements of building materials and Project Engineer is in-charge of projects. Cheques given to the District Collector only when payment exceeds Rs.1,00,000/-. Kattida Maiyams are registered under Societies Registration Act. Administration and management though vest in the Governing body, Society has its own staffing pattern and self sustainable. Kattida Maiyams are not discharging or conducting sovereign functions. Having regard to the functioning of Kattida Maiyams, it cannot be said that function of Kattida Maiyams are similar or closely related to those performable by State in its sovereign capacity. Applying the ratio of Full Bench decision, there is no force in the contention that Kattida Maiyams are other institutions within the meaning of Sec.16(c) of the Act. 20. Grievance of the Petitioner is that if Building Centres are to participate in the tender process, the work of Kattida Maiyams would be virtually reduced to Nil and thus all of them working under Kattida Maiyams would be greatly affected infringing their fundamental right of carrying of their avocation. It was further argued that District Collector only decides which work is to be executed through Building Centres and District Collector decides to float a tender, it would be absurd to say that District Collector will have to participate in the tender process as a Chairman of Building Centre. As pointed out earlier, Writ Petitioners are not the Building Centres established as per G.O.Rt.No.475 H & U.D. Dept., dated 011. 1990. As such Kattida Maiyams themselves have not expressed any grievance about the impugned G.O. Petitioners who are disgruntled group cannot complain of infringement of their right in carrying out the work. 21. As per Sec.3 no procurement shall be made by the procuring entity except by tender. 1990. As such Kattida Maiyams themselves have not expressed any grievance about the impugned G.O. Petitioners who are disgruntled group cannot complain of infringement of their right in carrying out the work. 21. As per Sec.3 no procurement shall be made by the procuring entity except by tender. As per Sec.2 (d) "Procurement means acquisition by any means by purchase of goods or services and also of construction. As per Sec. 2 (e) "Procuring entity means the entity specified in the Schedule to this Act. 22. Learned Senior counsel for the Petitioner has submitted that activity of Kattida Maiyam will not constitute procurement within the meaning of Sec. 2(d) of the Act and therefore, prohibition under Sec.3 of the Act would not apply to Kattida Maiyam and as such the Act does not apply to Kattida Maiyams in Tamil Nadu. This contention does not merit acceptance. Sec.2 of the Act specifies the prevalence of the provisions of the Act on the procuring or acquisition as prescribed in the schedule of Government Departments, Public Sector Undertakings, Statutory Bodies formed by Government, Local Bodies in the State. The works in which Kattida Maiyams participate are the works which are to be implemented by the Government Departments. Construction is an activity within the purview of "procurement" as defined under the Act and for procurement, tenders have to be called for as envisaged in Secs.9 and 10 of the Act. In fact, Sec.16 of the Act itself enumerates certain institutions. There is no exemption to Kattida Maiyam which is registered under Tamil Nadu Societies Registration Act. 23. Contention of the Petitioners is that non-application of mind in passing the impugned G.O. and making Kattida Maiyam to participate in the tender process and the impugned G.O. greatly affects the fundamental right of the Petitioners enshrined under Article 19 (1)(f) of Constitution of India. 24. In response, learned Additional Advocate General has elaborating by relying upon various irregularities noticed while entrusting works to Kattida Maiyams. It was stated that by entrusting works to Kattida Maiyams on nomination basis has became via-media for by-passing the tender process and entrusting works to Benami contractors under the guise of Kattida Maiyam. The impugned G.O. itself referes to various irregularities and number of vigilance and disciplinary files pending in the Rural Development Department relating to execution and irregularities in funds management in Kattida Maiyams in various districts. The impugned G.O. itself referes to various irregularities and number of vigilance and disciplinary files pending in the Rural Development Department relating to execution and irregularities in funds management in Kattida Maiyams in various districts. It is not as if Kattida Maiyams are prevented from carrying on the works. They are only made to ensure quality, efficiency and transparency. Kattida Maiyams are only made to participate in the tender process and there is lack of bonafide in the grievance of the Petitioners. 25. Right to carry on business being a fundamental right under Article 19(1(g) of Constitution. Exercise is subject only to the restriction imposed by law in the interest of general public. It is perfectly open to the Government to direct Kattida Maiyams to participate in the tender process. After all quality of work and transparency is prime concern, right of the Petitioners claiming convention method of nomination is not justifiable. Therefore, the Writ Petitioners are not entitled to the relief sought for and these Writ Petitions are bound to fail. 26. In the result, the Writ Petitions are dismissed. Interim stay already granted in M.P.No.2/2007 in W.P.No.2096/2007 dated 21. 2007 and M.P.No.1/2007 in W.P.No.7834/2007 dated 03. 2007 is vacated.