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2014 DIGILAW 488 (KAR)

State Bank of India v. Thimmyya

2014-04-24

H.G.RAMESH, RATHNAKALA

body2014
Judgment :- 1. These Writ appeals by State Bank of India are directed against the order of a learned Single Judge dated 13.02.2013 (reported in ILR 2013 KAR 1037 – Thimmyya v. State Bank of India) whereby the learned Single Judge has allowed the writ petitions filed by respondent no.1 by holding that Section 22A of the Legal Services Authorities Act, 1987 ('the Act') does not confer any power on the State Government to declare the service provided by Banking and Financial Institutions in the State to be a public utility service for purposes of chapter VIA of the Act and consequently has rejected the application filed by the appellant before the permanent Lok Adalat, Gulbarga under S.22C of the Act for recovery of Rs.1,29,065/- & interest etc. from respondent No.1 and another. 2. The learned Single Judge has held that the Government which controls the service only is empowered under S.22A of the Act to declare that service as a public utility service. The correctness of the said view is challenged by State Bank of India in these appeals. It is relevant to refer to the reasoning of the learned Single Judge in taking the aforesaid view: "4. Therefore, for the permanent Lok Adalat to exercise its power under the Act, one of the parties to the proceedings before it, should be a public utility service. The above definition of 'public utility service' does not include Banking Institutions. From the definition of 'Public Utility Service', it is clear that after expressly setting out the six services as Public Utility Services, the definition makes it clear that any services, which the Central Government or the State Government as the case may be, may, in the Public Interest, by notification, declare to be public utility service for the purposes of this chapter. The reason why such a power is conferred on Central Government as well as the State Government is though this is a Parliamentary Legislation, if a particular service is under the control of the Central Government, it is the Central Government, which is empowered to include such service as a public utility service. If such a service is under the control of the State Government, it is the State Government, which is empowered to include such service as a public utility service. 5. If such a service is under the control of the State Government, it is the State Government, which is empowered to include such service as a public utility service. 5. The Government of Karnataka issued a notification as per Annexure 'H' on 13th March 2008 in exercise of the powers conferred under Section 22-A of the Legal Services Authorities Act agreeing to include Banking and Financial Institutions in the State for 'Lok Adalat' under the category 'Public Utility Service' for the purpose of Chapter VI-A of Legal Services Authorities Act of 1987. The public utility service referred to is, the State Bank of India. It comes under the jurisdiction of the Central Government. State Government has no jurisdiction. That is why in the notification, the State Government has explicitly stated that they agree to include Banking and Financial institutions in the State for 'Lok Adalat' under the category of public utility service. Therefore, State Bank of India is not an Institution falling under the state. That notification has no application. Central Government has not issued any notification bringing within the definition of 'public utility service', the Banking Institutions. Under these circumstances, Lok Adalat was not justified in entertaining the suit filed by the State Bank of India and further erred in holding that because of the aforesaid notification issued by the State Government, Banking Institutions are also brought within the 'public utility service'. From the aforesaid material on record, it is clear that the Lok Adalat has no jurisdiction to entertain the suit, which is clear from the averments of the plaint itself. Therefore, without any further enquiry, the Lok Adalat ought to have allowed the application and dismissed the suit. Hence, the impugned order passed by the Lok Adalat is illegal and requires to be set-aside.........." (Underlining supplied) 3. Before proceeding to examine the matter, it is necessary to refer to S.22A of the Act, which reads as follows: "22A. Definitions.-In this Chapter and for the purposes of sections 22 and 23, unless the context otherwise requires,- (a) "Permanent Lok Adalat" means a Permanent Lok Adalat established under sub-section (1) of section 22B. Before proceeding to examine the matter, it is necessary to refer to S.22A of the Act, which reads as follows: "22A. Definitions.-In this Chapter and for the purposes of sections 22 and 23, unless the context otherwise requires,- (a) "Permanent Lok Adalat" means a Permanent Lok Adalat established under sub-section (1) of section 22B. (b) "public utility service" means any- (i) transport service for the carriage of passengers or goods by air, road or water; or (ii) postal, telegraph or telephone service; or (iii) supply of power, light or water to the public by any establishment; or (iv) system of public conservancy or sanitation; or (v) service in hospital or dispensary; or (vi) insurance service, and includes any service which the Central Government or the State Government, as the case may be, may, in the public interest, by notification, declare to be a public utility service for the purposes of this Chapter." (Emphasis supplied) The word "notification" is defined in S.2(1)(e) of the Act as under: "notification" means a notification published in the Official Gazette; It is relevant to state that the constitutional validity of the Legal Services Authorities (Amendment) Act, 2002, whereby chapter VI-A consisting of Ss.22-A, 22-B, 22-C, 22-D & 22-E relating to precipitation, conciliation and settlement was added to the Act, was upheld by the Supreme Court in Bar council of India ([2012]8 SCC 243) & in S.N. Pandey ([2012]8 SCC 261). 4. The notification dated 13th March 2008 issued by Government of Karnataka notifying the service by Banking and Financial Institutions in the State of Karnataka as a Public Utility service for purposes of chapter VIA of the Act was published in the Karnataka Gazette [Extraordinary] dated 26th March, 2008 in No.307 and it reads as follows: "Law, Justice and Human Rights Secretariat Notification No.LAW to LAD 2008, Bangalore, Dated: 13th March, 2008 In exercise of the powers conferred by Sec. 22A of the Legal Services Authorities Act, Government of Karnataka hereby agrees to include Banking and Financial Institutions in the State for 'Lok Adalat' under the category 'Public Utility Service' for the purpose of Chapter VIA of Legal Services Authorities Act of 1987." 5. Interpretation of S.22A of the Legal Services Authorities Act, 1987: The scope of power of the Central Government and the State Governments to declare the services not enumerated in clause (b) of S.22A of the Act as public utility services requires to be examined in these appeals. Having regard to the words 'any service' and 'as the case may be' used in S.22A of the Act, and as the public utility services enumerated in clause (b) of S.22A of the Act include not only the services provided by the Central and State Governments but also by the public & private sectors, we are of opinion that the Central and State Governments are respectively conferred with the power to declare any service provided by them as a public utility service. In other words, the Government which provides the service only has the power to declare such service as a public utility service. The State Government has no power to declare a service as a public utility service, if the service is provided by the Central Government. Similarly, the Central Government has no power to declare a service as a public utility service, if the service is provided by the State Government. Subject to the above restriction, S.22A of the Act confers power on State Governments to declare any service within the State to be a public utility service. Similarly, the Central Government is empowered to declare any service as a public utility service, if the service is not provided by the State Government. 6. With respect, we are unable to agree with the interpretation of S.22A of the Act made by the learned Single Judge. According to the said interpretation, if a service is not under the control of any Government, such a service cannot be declared as a public utility service by any Government. It is needless to state that all services are not controlled by Government. In our opinion, the theory of 'Control' stated by the learned Single Judge is not in conformity with the wide language employed in S.22A of the Act. The words 'any service' used in the section would clearly indicate that the intention of the Parliament was to give discretion to the concerned Governments to declare any service as a public utility service. In para 5 above, we have explained the scope of power of both the Central & the State Governments in this behalf. The words 'any service' used in the section would clearly indicate that the intention of the Parliament was to give discretion to the concerned Governments to declare any service as a public utility service. In para 5 above, we have explained the scope of power of both the Central & the State Governments in this behalf. The aforesaid intention can also be gathered from the public utility services enumerated by the Parliament in clause (b) of S.22A of the Act which include not only the services provided by the Central and State Governments but also by the public & private sectors. 7. The appellant is one of the public sector Banks and the service provided by public sector Banks cannot be construed as service provided by the Central Government. It is relevant to state that the appellant-State Bank of India is constituted under a parliamentary enactment namely, The State Bank of India Act, 1955. The Bank is a body corporate and is managed by the Central Board of Directors and guided by the Central Government. In law, the appellant-Bank cannot be equated to Central Government. Even if any service is provided by a Government company or a Government Controlled Company, it cannot be said that the service is provided by Government. Government and Government owned companies are not the same in law. In our opinion, the State Government was well within its power under S.22A of the Act in declaring the service provided by Banking and Financial Institutions in the State to be a public utility service. The notification dated 13th March 2008 issued by Government of Karnataka referred to above is accordingly valid in law. 8. The contention of the counsel for respondent no.1 that, having regard to the language employed in the notification, the State Government has only agreed to include the service but has not included the service under 'public utility services' does not appeal to us. In view of publication of the notification in the official Gazette, the intention of the State Government was obviously to declare the service to be a public utility service. However, the notification could have been more appropriately worded conforming to the language employed in S.22A of the Act. 9. In view of the above, the impugned order of the learned Single Judge is unsustainable in law and is accordingly set aside. The writ petitions are dismissed. However, the notification could have been more appropriately worded conforming to the language employed in S.22A of the Act. 9. In view of the above, the impugned order of the learned Single Judge is unsustainable in law and is accordingly set aside. The writ petitions are dismissed. The writ appeals are allowed in the above terms but with no order as to costs. Appeals allowed.