1988 (3) TMI 452 - SC - Indian Laws

Bihar Ordinances Valid, Educational Institute Nationalization Justified; Dr. Jha's Termination Reconsidered

The Court upheld the constitutional validity of Bihar Ordinances and the Bihar Private Educational Institutions Act, stating that the nationalization of ... Permissible classification and intelligible differentia under Article 14 - right to form association under Article 19(1)(c) limited to formation and not to protect activities/objects - acquisition of property and Entry 42, List III - legislative competence of State to enact acquisition law - principles of natural justice - reasonable opportunity to be heard before termination of servicePermissible classification and intelligible differentia under Article 14 - Validity of the Bihar Private Educational Institutions (Taking over) Act, 1987 and the predecessor ordinances under Article 14 - HELD THAT: - The Court held that the Act and the ordinances effecting phased nationalisation do not amount to impermissible discrimination under Article 14. Nationalisation in phases contemplates taking institutions in stages; the selection of the Institute for the first phase was a legislative choice and not an arbitrary singling out. The doctrine that a single individual or entity may constitute a class by itself applies only where there is an intelligible differentia rationally related to the statute's object; here the enactment applies to all institutions answering the statutory definition and the Legislature legitimately selected the Institute for phase one. Delay in implementing subsequent phases, or temporary affiliations granted to other institutes during pendency of litigation, did not convert the legislative scheme into a colorable device of discrimination.The Act and the ordinances are not violative of Article 14 and the challenge on grounds of discrimination is rejected.Right to form association under Article 19(1)(c) limited to formation and not to protect activities/objects - Whether the acquisition of the Institute by the State infringed the Society's fundamental right under Article 19(1)(c) - HELD THAT: - The Court distinguished acquisition of the Institute (an activity/property of the Society) from interference with the Society's constitution or composition. Article 19(1)(c) guarantees the right to form associations but does not, by itself, secure the objects, activities or property of an association against legislative regulation or acquisition except as otherwise provided. Precedents showing that alteration of composition of a society infringes Article 19(1)(c) were held inapplicable where composition of the Society remains untouched. Thus acquisition of the Institute and consequent loss of control over that property does not, without more, amount to infringement of the Society's right to form or continue the association.The challenge under Article 19(1)(c) is unsound and rejected.Acquisition of property and Entry 42, List III - legislative competence of State to enact acquisition law - Whether the State Legislature had competence to enact the impugned law - HELD THAT: - The Court analysed the pith and substance of the Act and found it to be legislation effectuating the taking over (acquisition) of a private educational institution. Consequently Entry 42 of List III (acquisition and requisitioning of property) is the applicable head of power. The Act was not primarily a law regulating coordination or standards of higher education under Entry 66, List I or Entry 25, List III. Since acquisition falls within Entry 42, the State Legislature was competent to enact the law. A separate contention as to compulsory payment of compensation post-repeal of Article 31(2) was not pressed and the Court did not decide it.The State Legislature had legislative competence; the challenge on competence grounds fails.Principles of natural justice - reasonable opportunity to be heard before termination of service - Validity of the termination of service of Dr. Jagadanand Jha (Registrar) dated April 21, 1986 - HELD THAT: - Paragraph 6 of the ordinance (mirrored in the Act) distinguishes teaching staff (for whom termination/absorption decisions are expressly provided) from 'other categories of staff' whose terms and conditions were to be determined. The Court found that the Registrar was non teaching staff and that the ordinance does not itself mandate immediate summary termination of such non teaching employees. Even though legislative directions may displace some procedural safeguards, where the act in question is administrative and affects individual rights of employment the rules of natural justice apply. The termination order was passed in undue haste two days after promulgation; no reasonable opportunity to make representations appears to have been afforded. The Court therefore quashed the termination order and permitted the State Government to reconsider any termination only after giving the petitioner a reasonable opportunity to be heard.The termination order is quashed; the State may revisit the question only after giving the petitioner a reasonable opportunity of representation.Final Conclusion: Writ petitions and appeals attacking the Act and ordinances on grounds of discrimination, infringement of Article 19(1)(c) and lack of legislative competence are dismissed. The termination order of April 21, 1986 against Dr. Jagadanand Jha is quashed for failure to afford a reasonable opportunity to be heard; the State may reconsider termination after giving him such opportunity. No costs. Issues Involved:1. Constitutional validity of Bihar Ordinances Nos. 15 of 1986 and 30 of 1986 and the Bihar Private Educational Institutions (Taking over) Act, 1987.2. Legality of the termination of Dr. Jagadanand Jha's service as Registrar of Lalit Narayan Mishra Institute of Economic Development and Social Change.Summary:1. Constitutional Validity of the Act and Ordinances:The Lalit Narayan Mishra Institute of Economic Development and Social Change, Patna, challenged the constitutional validity of Bihar Ordinances Nos. 15 of 1986 and 30 of 1986, replaced by the Bihar Private Educational Institutions (Taking over) Act, 1987. The petitioners argued that the Act violated Article 14 of the Constitution by singling out the Institute for nationalization without a reasonable basis. The Court held that the Act did not violate Article 14 as it aimed to nationalize private educational institutions in phases, starting with the Institute. The legislative decision to nationalize the Institute first was justified due to the State's significant financial and administrative involvement in the Institute since 1975. The Court rejected the argument that the Act violated Article 19(1)(c), stating that the right to form an association does not extend to the activities or objects of the association. The Act did not interfere with the Society's composition or its right to form an association. The Court also found that the Act fell within the legislative competence of the State Legislature under Entry 42 of List III, pertaining to the acquisition and requisition of property.2. Legality of Termination of Dr. Jagadanand Jha's Service:Dr. Jagadanand Jha's service as Registrar was terminated by an order dated April 21, 1986, under the provisions of the ordinance. The Court found that the termination was done in haste without properly applying the mind and without giving Dr. Jha a reasonable opportunity to be heard. The Court held that the principles of natural justice required that Dr. Jha be given an opportunity to make a representation before his services were terminated. Consequently, the Court quashed the termination order and allowed the writ petitions and civil appeal related to Dr. Jha's termination. The State Government was given the liberty to reconsider the termination after giving Dr. Jha a reasonable opportunity to be heard.Conclusion:The Court dismissed the writ petitions and civil appeal challenging the constitutional validity of the ordinances and the Act. However, it allowed the writ petitions and civil appeal related to the termination of Dr. Jagadanand Jha's service, quashing the termination order and directing the State Government to reconsider the matter after giving him a reasonable opportunity to make a representation. There was no order for costs in any of these matters.