TaxTMI 
TaxTMI 
1999 (1) TMI 548
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.... is 'State' for the purpose of Article 12 of the Constitution of India. The petitioner's application seeking permission to contest in the Bangalore City Corporation Elections came to be rejected. 3. Petitioner Smt. C. Chandramma, in W.P. No. 28766 of 1996 is an employee working as Senior Office Assistant in M/s. Indian Telephone Industries Limited, Bangalore Complex, Dooravaninagar, Bangalore-16. She filed her nomination and the scrutiny of the nomination papers was taken up on 4-1-1996. It appears that the first respondent had issued a note on the qualifications and disqualifications of candidates under the Act, dated 19-12-1995 and inter alia it was opined by the first respondent that employees of the State, Central and Public Sector Undertakings are deemed to hold an office of profit under an authority; and so, the same is a disqualification under Section 26(1)(c) of the KMC Act. 4. Petitioner Sri Muniraju in W.P. No. 28842 of 1996 is an employee working as Accountant Category (SH) in M/s. Indian Telephone Industries Limited, Bangalore Complex, Bangalore. He contends that Indian Telephone Industries Limited is a Public Sector Undertaking engaged in the business of ....
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.... order dated 8-10-1996 observed.- "However, having regard to the subsequent decision of the Supreme Court in Satrucharla Chandrasekkar Raju v Vyricherla Pradeep Kumar Dev, which distinguishes Biharilal Dobray v Roshan Lal Dobray, and the decision of the Full Bench of this Court in K.V. Panduranga Rao v Karnataka Dairy Development Corporation, Bangalore and Others and the disinvestment of part of the share capital in BEML by the Central Government in favour of the public, the position may not be the same and the matter requires consideration by a Division Bench". 3. After hearing the learned Counsel for the parties, perusing the record and minutely examining various judgments cited at the Bar, we are prima facie of the opinion that the law laid down by this Court in Chenna Reddy's case, supra, which was affirmed by the Division Bench in W.A. No. 669 of 1990, requires reconsideration. While disposing of SLP No. 11150 of 1991, the Hon'ble Supreme Court had not decided the pleas on merit and appear to have dismissed the appeal in limine without assigning the reasons or passing a speaking order. The learned Counsel for the petitioners tried his best to persuade us ....
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...., 'Government Companies' were considered as 'other authorities' under Article 12. Therefore, contextually, the words 'other authorities' in Section 26(1)(c) should be understood as referring only to Statutory Corporations. Therefore, it is contended by the petitioners that, holding of office of profit under 'other authority' as defined under Article 12 is not a disqualification as the 'other authority' under Section 26(1)(c) of the Act, is not the same as 'other authority' in Article 12 of the Constitution. Consequently, Section 26(1)(c) of the KMC Act is no bar for contesting in the election. It is further contended that Section 26(1)(c) is irrational, vague and discriminatory and therefore, it is unconstitutional. 8. Learned Advocate General and Counsel for respondent organizations contended that the petitioners are the employees of Government Companies which will fall within the definition of 'other authority' as used in Article 12 and Section 26(1)(c) of the Act. The term 'other authority' used in Section 26(1)(c) has the same meaning as the words 'other authority" in Article 12. Therefore, the petitioner....
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....ect to the control of any of the said Governments. Explanation.--For the purpose of this article, a person shall not be deemed to hold any office of profit by reason only that he is the President or Vice-President of the Union or the Governor of any State or is a Minister either for the Union or for any State". Article 66(4) reads: 66. Election of Vice-President.- (1).... (2).... (3).... (4) A person shall not be eligible for election as Vice-President if he holds any office of profit under the Government of India or the Government of any State or under any local or other authority subject to the control of any of the said Governments. Explanation.--For the purposes of this article, a person shall not be deemed to hold any office of profit by reason only that he is the President or Vice-President of the Union or the Governor of any State or is a Minister either for the Union or for any State". We have to examine whether the words "other authority" in Section 26(1)(c) of the KMC Act is similar to 'other authority' in Article 12 of the Constitution of India. 12. It was argued at length to persuade to hold that the respondent-companies are....
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.... of Directive Principles. 15. Part IX-A was incorporated providing constitutional status to the 'Municipalities'. Article 243-Q deals with constitution of Municipalities. Article 243-R deals with composition of Municipalities. Article 243-S deals with constitution and composition of Wards Committees, etc. Article 243-T deals with Reservation of Seats. Article 243-V deals with disqualifications for membership.--It provides that a person shall be disqualified for being chosen as, and for being, a member of a Municipality.- (a).....(omitted as not necessary). (b) if he is so disqualified by or under any law made by the Legislature of the State. Article 243-ZA deals with Elections to the Municipalities. Sub-clause (2) reads: "Subject to the provisions of this Constitution, the Legislature of a State may, by law, make provision with respect to all matters relating to, or in connection with, elections to the Municipalities". As per the above said clause, the Constitution empowers the States to make law with respect to all the matters relating to or in connection with election to Municipality. "Article 243-ZF deals with continuance of existing ....
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....ts of the people. The State, as constituted by our Constitution, is further specifically empowered under Article 298 to carry on any trade or business. The circumstance that the Board under the Electricity Supply Act is required to carry on some activities of the nature of trade or commerce does not, therefore, give any indication that the Board must be excluded from the scope of the word "State" as used in Article 12. On the other hand, there are provisions in the Electricity Supply Act which clearly show that the powers conferred on the Board include power to give directions, the disobedience of which is punishable as a criminal offence. The Rajasthan Electricity Board was clearly an authority to which the provisions of Part III of the Constitution were applicable". 20. In case of Ramana Dayaram Shetty v International Airport Authority of India , the Supreme Court traced the genesis of the formation of the Government Companies and held that they were the Instrumentalities or the agencies of the State and were bound to conform to the Fundamental Rights in the same manner as the legislature and the executive. The relevant portion of the judgment reads: ". . .....
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....istributing Company of India Limited in relation to its undertakings in India shall, instead of continuing to vest in the Central Government vest with effect from the twenty-fourth day of January, 1976, in Burmah Shell Refineries Limited. This is the well-worn legal strategy for Government to run economic and like enterprises. We live in an era of public sector corporations, the State being the reality behind. Law does not hoodwink itself and what is but a strategy cannot be used as a stratagem: XXX XXX XXX 26. Constitutional law is not a game of hide and seek but practical real life conclusions. So viewed, we are constrained to hold that Burmah Shell, a Government company though, is but the alter ego of the Central Government and must, therefore, be treated as definitionally caught in the net of 'State' since a juristic veil worn for certain legal purposes cannot obliterate the true character of the entity for the purposes of constitutional law. XXX XXX XXX 39. Let us cull out from Airport Authority's case, supra, the indicia of "other authorities. . . under control of the Government of India" bringing a corporation within the definition of "the ....
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....t 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 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 -- exercise of industrial absolutism. It is dangerous to exonerate corporations from the need to have constitutional consci....
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....e said to be a local authority and therefore, it must come within the expression "other authorities" if it is to fall within the definition of 'State'. That immediately leads us to a consideration of the question as to what are the "other authorities" contemplated in the definition of 'State' in Article 12". ....It is the Fundamental Rights which along with the Directive Principles constitute the life force of the Constitution and they must be quickened into effective action by meaningful and purposive interpretation. If a corporation is found to be a mere agency or surrogate of the Government "in fact owned by the Government, in truth controlled by the Government and in effect an incarnation of the Government" the Court must not allow the enforcement of Fundamental Rights to be frustrated by taking the view that it is not the Government and therefore not subject to the constitutional limitations. We are clearly of the view that where a corporation is an instrumentality or agency of the Government, it must be held to be an 'authority' within the meaning of Article 12 and hence subject to the same basic obligation to obey ....
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....te of Constitutional and Parliamentary Studies (ICPS) is State or not, held that the said Society is not a State. The objects of the society inter alia were.- "(1) to promote and provide for constitutional and parliamentary studies with special reference to comparative studies in constitutional systems of various countries and working of the Indian Constitution and parliamentary and governmental institutions in their various aspects; (2) to undertake study of courses and fundamental research relating to developments in constitutional law, conventions and practices, parliamentary procedure, legislative drafting, trends in judicial interpretation and allied matters; (3) to organise inter alia training programmes in constitutional problems and matters of current parliamentary importance; (4) to set up a legislative research and reference service for the benefit of all interested members of the Union Parliament and State Legislatures irrespective of their party affiliations; (5) to undertake and provide for the publication of a journal and of research papers and of books and brochures with a view to disseminate democratic values and to foster broad based civic education ....
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.... and in fact touches all aspects of social existence. In the absence of a fair application of the tests to be made, there is possibility of turning every non-governmental society into an agency or instrumentality of the State. That obviously would not serve the purpose and may be far from reality. 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. Having given our anxious consideration to the facts of the case, we are not in a position to hold that ICPS is either an agency or instrumentality of the State so as to come within the purview of 'other authorities' in Article 12 of the Constitution. We must say that ICPS is a case of its type -- typical in many ways and the normal tests may perhaps not properly apply to test its character". 27. In Sabhajit Tewary's case, supra, Justice A.N. Ray, Chief Justice, speaking for the Constitutional Bench of the Supreme Court, held: "The Council of Scientific and Industrial Research, a society registered under the Societies Registration Act is not an authority within the meaning of Article 12. Th....
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..... From the principles laid down in these cases, it is evident that, though societies registered under the Societies Registration Act, are created by the Government, unless they have the characteristics as narrated in R.D. Shetty's case, supra, they will not be considered as 'other authorities' under Article 12. 30. Thus the Apex Court has considered whether the organisations, Companies and Corporations are authorities within the meaning of Article 12 of the Constitution of India, after scrutinising the nature or origin, pervasive control of the State and financial assistance by the State, Rules and Bye-laws made, and power provided to such body and its control over other organisations etc. Taking these facts, we have to decide whether any organisation is an 'Authority' or not, keeping in view the principles laid down by the Apex Court. 31. BEML was incorporated under the Companies Act on 11th May, 1964. The share capital of the Company was Rs. 15 Crores divided into 1,50,000 equity shares of Rs. 1,000/- each. The subscribers to the Memorandum of Association were the President of India and four other officers of the Government of India, viz., the Secretary, the....
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.... 51% shares. According to the definition of 'Government Company', where the Government is owning 51% shares in a Company it is a Government Company. Therefore, merely because some of the shares are divested, the Company will not cease to be a Government Company unless its share holding becomes less than 50%. The position of Indian Telephone Industries Limited which is another Public Sector Undertaking engaged in the manufacture of Defence and Telecommunication equipment, is similar. 33. These two organisations are Government Companies subject to pervasive control of the Central Government. Therefore, these organisations are 'other authorities' under Article 12 of the Constitution of India. In fact, as early as 1982, this Court has held that BEML is 'State' in. 34. The next contention of the petitioners is that, though respondent organizations are 'other authorities' within the meaning of Article 12 of the Constitution of India, the said principle cannot be extended while considering 'other authorities' under Section 26(1)(c) of the impugned Act; and the expression 'other authorities' in Section 26(1)(c) of the impugned Act has to be....
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....(1) A person shall be disqualified for being chosen as and for being a Councillor.- (c) if he holds any office of profit under the Government of India or the Government of any State specified in the First Schedule to the Constitution of India, or under any local or other authority subject to the control of any of the said Governments other than such offices as are declared by rules made under this Act not to disqualify the holder"; Both these sections are similar and there is no difference and as stated supra, a Division Bench of this Court held that the office of profit in BEML is a bar for contesting elections under Section 11(1)(j) of the Zilla Parishads Act, which is similar to Section 26(1)(c) of the KMC Act. Therefore, holding of office of profit in BEML and ITI which are "other authorities" amounts to holding of office of profit in terms of Section 26(1)(c) of the impugned Act. So, the petitioners are disqualified to contest the election of Municipal Councillor. 39. Let us now consider whether the said decision requires reconsideration having regard to the contentions urged by the petitioners. At the outset, it should be noticed that the tests applicable t....
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....udgment holding that, other than the statutory body, i.e., the local or other authorities, the autonomous body are not 'other authorities' is not tenable. The law laid down by the Supreme Court giving wider interpretation to the words 'other authority' was there even before Rajasthan State Electricity Board's case, supra. 45. This point can be viewed in another perspective. The words 'other authorities' apart from Article 12 of the Constitution, is also found in Articles 58(2) and 66(4) of the Constitution of India. 46. Article 58 of the Constitution deals with qualification for election as President of India. Article 58(2) provides that: "A person shall not be eligible for election as President if he holds any office of profit under the Government of India or the Government of any State or under any local or other authority subject to the control of any of the said Governments". Article 66 deals with election of Vice-President of India. Article 66(4) provides: "A person shall not be eligible for election as Vice-President if he holds any office of profit under the Government of India or the Government of any State or under any loca....
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....eal with the disqualification for the election of the President and Vice-President of India, held that for contesting of election of President and Vice-President of India, a person holding of office of profit under 'other authority' is disqualified as there is a specific provision under Articles 58(2) and 66(4) of the Constitution. Whereas, for contesting elections of the legislative assembly or parliamentary members, there is no disqualification in Articles 102(1) and 191(1)(a) of the Constitution of India. The Supreme Court after comparing the above articles held that, the person holding an office of profit under 'other authority' is not a disqualification for the election of the legislative assembly or parliamentary members. Thus, the Supreme Court has impliedly held that a person working in a Government Company which is a person holding office of profit in an 'other authority' is a disqualification for election of the President and Vice-President of India. This judgment was there much earlier to the enactment. As stated supra, the Legislature is deemed to have the knowledge of all the provisions of the Acts and judgments of the Courts. Therefore, it is p....
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....of the KMC Act cannot be said to be an extension of the meaning of the words 'other authority' in Article 12 of the Constitution of India. 51. It is nextly contended that, the KMC Act was enacted in 1976. By applying the contextual interpretation, unless it is a statutory corporation, the respondent organizations can be held as 'other authorities'. For this proposition, learned Counsel for the petitioner relied on a judgment of the Supreme Court in M/s. Utkal Contractors and Joinery Private Limited and Others v State of Orissa and Others, wherein the Supreme Court held: "A statute is best understood if one knows the reason for it. The reason for a statute is the safest guide to its interpretation. The words of a statute take their colour from the reason for it. There are external and internal aids to discover the reason for a statute. The external aids are statement of objects and reasons when the Bill is presented to Parliament, the reports of Committees which preceded the Bill and the reports of Parliamentary Committees. Occasional excursions into the debates of Parliament are permitted. Internal aids are the preamble, the scheme and the provisions of the ....
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.... designed to say as to fit into the scheme of the entire Act, No part of a statute and no word of a statute can be construed in isolation. Statutes have to be construed so that every word has a place and everything is in its place. It is by looking at the definition as a whole in the setting of the entire Act and by reference to what preceded the enactment and the reasons for it that the Court construed the expression 'Prize Chit' in Srinivasa Enterprises v Union of India and we find no reason to depart from the Court's construction". 53. There is no dispute about the propositions laid down in the above judgments. 54. The KMC Act used the word 'local' or 'other authority' in Section 26(1)(c) of the KMC Act, prescribing the disqualification for the persons who are holding office under the 'other authorities'. Interpreting similar section in Section 11(1)(j) of the Zilla Parishad Act, this Court held that the employment in BEML is an authority holding office of profit which entails a disqualification as held in Chenna Reddy's case, supra, which was confirmed in W.A. No. 669 of 1990, dated 23-10-1990. In both the judgments, it was conside....
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....o vote or right to elect is neither a fundamental nor a civil right but was a pure and simple statutory right. 60. The Supreme Court in Mohan Lal Tripathi v District Magistrate, Rai Bareilly and Others, held that democracy is a concept, a political philosophy, an ideal practice by many nations culturally advanced and politically matured by resorting to governance by representatives of the people elected directly or indirectly. But elected representative to govern is neither fundamental right nor common law right but a special right created by the statutes, or a political right or a privilege by the statutes, or a political right or a privilege and not a natural, absolute or vested right. Concepts familiar to common law and equity must remain stranger to election law unless statutorily recognised. 61. From the above principles laid down in the said judgments, it is manifest that the right to elect, right to be elected are statutory creations. So, they are subject to statutory limitations. Therefore, the statute can impose any restrictions. So, disqualification prescribed for the holders of the office of profit under 'other authority' is valid disqualification prescribed by....
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....nciple will not apply while interpreting the words 'other authority' in Article 12 of the Constitution of India. An examination of Section 26(1)(c) of the Act makes it evident that there is absence of any mention of generis or single species, therefore, applying principle laid down by the Apex Court, the rule ejusdem generis will not apply for interpreting 'other authority' similar to 'Local Authority'. 66. The principle laid down by the Apex Court manifests that to invoke the application of ejusdem generis rule there must be distinct genus or category. The specific words must apply not to different objects of the widely different character but to something which can be called a class or kind of object, where this is lacking the rule will not apply and mention of single species will not constitute genus. 67. As held above the 'other authority' in Section 26(1)(c) of the Act cannot be interpreted by applying the principle of ejusdem generis, so, we are not able to accede to the contention of the Counsel for the petitioners. 68. It is fourthly contended that the control on the respondent organizations is not similar to one envisaged on Municipal Cor....
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....s given the restricted meaning to 'Local Authority' in the Act. Therefore, the words 'other authority' is incorporated keeping in view the definition of the term 'Local Authority' in the General Clauses Act which is wider, so the words 'Authority' should be interpreted as per the definition in General Clauses Act. 73. This contention at the outset is not tenable, if the Legislature intended to incorporate the definition of the 'Local Authority' as defined in General Clauses Act, the Legislature would have incorporated the same. When the Legislature specifically provided the definition of 'Local Authority' in KMC Act, to infer that the Legislature was having in mind the definition of the 'Local Authority' as under the General Clauses Act is not acceptable. If it is accepted for the purpose of arguments, it amounts to amending a statute i.e., to place the word 'Local Authority' in General Clauses Act in the place of 'other authority' which is not within the function of this Court. 74. The learned Counsel for the petitioners sixthly contended that when the organisation is an "Autonomous body" without f....
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....ourt and the principle has to be applied according to the facts of each case. The respondent organizations are governed by the regulations and guidelines framed. We have already held that the respondent organizations are instrumentalities of the State and merely because they are 'Autonomous' as far as administration is concerned, by that itself it cannot be inferred that they are not instrumentalities of the State. 79. The learned Counsel lastly contended that Section 26(1)(c) of the Act is vague, irrational and discriminatory, and violates Article 14, so it is unconstitutional. 80. The Section 26(1)(c) of the Act disqualifies a person holding office of profit under 'other authorities'. It is contended that the Members of Parliament and Members of Legislative Assemblies are nominated as members of the Corporation Council. Though they are holders of office of profit under Government Companies falling with 'other authorities' in terms of Article 12 of the Constitution of India, they are permitted to be the nominated members of Council, whereas the persons holding office of profit in Government Company are disqualified from contesting elections to the Corpora....
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....lient. So, this section is discriminatory and violative of Article 14 of the Constitution. The Supreme Court repelled the contention and held that it is a classification by class. 82. In Gauri Shankar and Others v Union of India and Others , it is observed: "Para 9 ....."Legislation enacted for the achievement of a particular object or purpose need not be all embracing. It is for the Legislature to determine what categories it would embrace within the scope of legislation and merely because certain categories which would stand on the same footing as those which are covered by the legislation are left out would not render legislation which has been enacted in any manner discriminatory and violative of the fundamental right guaranteed by Article 14 of the Constitution". The principle laid down in the above decisions squarely supports our view. Therefore, the contention that the provision is discriminatory is not tenable. 83. It is further contended that sub-section empowered the Government to make rules exempting from disqualification to the holders of office of profit under 'other authorities' or Government and therefore, the power conferred on the Govern....
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....nacting the appropriate laws under Article 191(1)(e) of the Constitution. In the said decision it is observed as follows: "Or are employees of Public Corporations to be treated differently from employees of the Government? Are not some of them in a better position to exert undesirable pressure than Government employees? On the other hand, are a tremendously large number of employees of Public Corporations to be denied the opportunity of being chosen, as representatives of the people? Do all the considerations applicable to Government employees equally apply to employees of Public Sector Undertakings? Is there no distinguishing feature? Are a large mass of highly or moderately literate people to be denied the right to speak for the people? Is the right to be elected, to be confined, without meaning, any disrespect to any one to the professional politicians only? These are some of the vital questions posed and which require to be answered. The answer should be best given by the elected representatives of the people themselves....". This makes it clear that the policy to provide disqualification and to which section of people it has to be provided and for whom it is not t....
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....ntal rights (Bill of Rights) incorporated in the Constitution. In India, the position is similar to the United States of America. The power of the Parliament or for that matter, the State Legislatures is restricted in two ways. A law made by the Parliament or the Legislature can be struck down by Courts on two grounds and two grounds alone, viz., (1) lack of legislative competence and (2) violation of any of the fundamental rights guaranteed in Part I of the Constitution or of any other constitutional provision. There is no third ground. We do not wish to enter into a discussion of the concepts of procedural unreasonableness and substantive unreasonableness--concepts inspired by the decisions of United States Supreme Court. Even in U.S.A. these concepts and in particular, the concept substantive due process have proved to be of unending controversy, the latest thinking tending towards a severe curtailment of this ground (substantive due process). The main criticism against the ground of substantive due process being that it seeks to set up the Courts as arbiters of the wisdom of the Legislature in enacting the particular piece of legislation. It is enough for us to say that by what....
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....he judgment in Bihnrilal Dobray's case, supra. 91. In Biharilal Dobray's case, supra, the Supreme Court considered whether the Assistant Teacher of Basic Primary School run by the Uttar Pradesh Board of Basic Education is holding of office of profit under premises or not. The Supreme Court has considered the holding of office of profit in a school under the control of Uttar Pradesh Board is a disqualification under Article 191(1)(a) of the Constitution. The Apex Court referred the Uttar Pradesh Basic Education Act, 1972 (U.P. Act No. 34 of 1972) and the Bill, i.e., Uttar Pradesh Basic Education Bill, 1972, in pursuance of which, Act was passed; after referring all the provisions, the Court found that the Board for all practical purposes is a department of the Government and its autonomy is negligible. Therefore, the teacher who is holding an office of profit in a Primary School controlled by the Board is holding an office under the State Government and so his nomination was right to be rejected. 92. The Supreme Court in Satrucharla Chandrasekhar's case, supra, has considered whether a teacher working in a Primary School run by the Integrated Tribal Development Agency ....
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....the ITDA which carries out the object of providing the compulsory education in tribal area. But the ITDA is a registered society having its own constitution. Though the Project Officer is the District Collector, he acts as a different entity. The power to appoint or to remove teachers is not with the Government but with the Project Officer. The Government have control over the Appointing Authority but has no direct control over the teachers. The small post that appellant holds in ITDA is only that of a teacher who is directly under the control of the Project Officer. In such a situation the question of any conflict between his duties and interests as an elected member does not arise since it cannot be said that he, as a teacher, can be subjected to any kind of pressure by the Government which has neither the power to appoint him nor to remove him from service". 95. Taking all these facts into consideration the Apex Court expressed a view that the appellant cannot be held to be holding an office of profit under the Government. 96. The facts of the above case are quite different from the facts of Biharilal Dobray's case, supra. Therefore, there is no change of position in ....
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....n, is invalid and inoperative, being violative of Article 14 and the basic schedule of the Constitution. 4, Thus, two questions arise for decision: (a) Whether Section 26(1)(c) of the KMC Act, is constitutionally valid; (b) Whether Section 26(1)(c) of the KMC Act disqualifies employees of Government Companies/Public Sector Undertakings, from being chosen as Councillors of Municipal Corporations. While fully agreeing with the reasoning and decision [of learned Acting Chief Justice] on the first question, with respect, I am unable to agree that Government Companies (like BEML and ITI) fall under the expression 'other authority, subject to the control of Government', used in Section 26(1)(c) of the Act and therefore its employees are disqualified for being chosen as Councillors. I will briefly indicate the reasons therefore. 5. Section 25 of the KMC Act read with Sections 22 and 23 of the said Act and Sections 16 and 19 of the Representation of the People Act, 1950, provides that every adult citizen of India [not of unsound mind], whose name is included in the Electoral Roll of any division of the city is qualified for election as a Councillor. Section 26 contains the d....
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....Karnataka General Clauses Act, 1899 or any other statute. There is also no judicial interpretation of the expression 'other authority', when used with reference to disqualification of the employees of such institutions, to contest elections. 6.3 The Cambridge International Dictionary of English defines an 'authority' as a group of persons with official responsibility for a particular area of activity and having a moral or legal right or ability to control others. 6.4 The expression 'Authority' in its etymological sense means 'a Body invested with power to command or give an ultimate decision, or enforce obedience or having a legal right to command and be obeyed'. Webster's Dictionary of the English Language, defined 'authorities' as 'official bodies which control a particular department or activity, especially of the Government'. The expression 'other authorities' has been explained as 'authorities entrusted with a power of issuing directions, disobedience of which is punishable as an offence' or 'bodies exercising legislative or executive functions of the State' or 'bodies which exercise part of the ....
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.... Government, was disqualified for being chosen as a member of the Legislative Assembly. The question whether an employee of an 'other authority subject to the control of the Government' was disqualified, never arose for consideration. The Supreme Court held that the company came under the control of the Government and the candidate who was holding an office of profit under the company, but he did not incur disqualification under Article 191(1)(a). The Supreme Court referred to the distinction between disqualification under Articles 58(2) and 66(4) on the one hand and disqualification under Articles 102(1) and 191(1)(a) on the other and observed as follows: "In this connection, a comparison between Articles 58(2) and 66(4) and Articles 102(1) and 191(1)(a) of the Constitution is of significant help. In Articles 58(2) and 66(4) dealing with eligibility for election as President or Vice-President of India, the Constitution lays down that a person shall not be eligible for election if he holds any office of profit under the Government of India or the Government of any State or under any local or other authority subject to the control of any of the said Governments. In Ar....
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.... down in Articles 102(1)(a) and 191(1)(a) of the Constitution. One is that the holding of an office in a company, in the capital of which - the Government has not less than 25% share is not covered by the disqualification laid down in Articles 102(1)(a) and 191(1)(a) as, otherwise, this provision would be redundant. The second is that even Parliament when passing the Act, did not consider it necessary to disqualify every person holding an office of profit under a Government Company, but limited the disqualification to persons holding the office of managing agent, manager or secretary of the company. The fact that the entire share capital in the company in the case before us is owned by the Government does not, in our opinion make any difference". What is extracted above will clearly show the question whether a Government company is an 'other authority' and whether an employee of a Government company was disqualified to contest elections having regard to a ban in regard to employees of 'other authorities under the control of the Government' did not arise at all for consideration in Gurushanthappa's case, supra, nor decided. The said decision is, therefore, ....
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.... has also been held to be as other authority by this Court in T.G. Srinivasamurthy v Bharat Earth Movers Limited. 9.3 There can be no two views that a Government Company is 'other authority' for purpose of Article 12, as held in Ajay Hasia's case, supra, and other cases, if it is an instrumentality or agency of the Government. 10. But, the question is whether the meaning given to the expression 'other authorities' for the purpose of Article 12, could be applied or extended to the expression 'other authority' in Section 26(1)(c) of the KMC Act. It should be remembered that expanded and widened definition of the expression 'other authority' in Article 12, is only for the purpose of extending the enforcement of fundamental rights against instrumentalities or agencies of the Government. There is no question of enforcement of fundamental rights in this case. The question is whether an employee of a Municipal Corporation is barred from contesting elections for being elected as Councillor of a Municipal Corporation. There is absolutely no connection or similarity of purpose between Article 12 and Section 26(1)(c). In such circumstances, the meaning as....
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....Sukhdev Singh v Bhagatram Sardar Singh Raghuvanshi, dealing with three statutory corporations, that is ONGC, LIC and Industrial Financial Corporation. The Court took note of the fact that these bodies were statutory corporations and not companies. 11.5 The last expansion was, by inclusion of Government companies and societies under the deep and pervasive control of the Government, in the ambit of other authorities, in Ajay Hasia's case, supra and Som Prakash's case, supra, on the foundation laid in Ramana Dayaram Shetty's case, supra. It was held that an instrumentality or agency of the Government will fall within the scope of 'other authorities', irrespective of the fact whether the corporation was created by the statute or under a statute. Till the decision in Ajay Hasia's case, supra, and Som Prakash's case, supra, (both rendered on 13-11-1980), based on R.D. Shetty's case, supra, a Government company was never considered as 'other authority' for purposes of Article 12. 11.6 The reason for expanding the scope of 'other authorities' in Article 12 to include Government companies is stated thus in Ajay Hasia's case, supra: &qu....
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....asive presence of the Government. It is really the Government which acts through the instrumentality or agency of the corporation and the juristic evil 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 corporation 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 fortiori that the Government acting through the instrumentality or agency of a corporation should equally be subject to the same limitations. If such a corporation were to be free from the basic obligation to obey the fundamental rights, it would lead to considerable erosion of the efficiency of the fundamental rights, for in that event, the Government would be enabled to override the fundamental rights by adopting the stratagem of carrying out its functions throu....
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....constitute the life force of the Constitution and they must be quickened into effective action by meaningful and purposive interpretation. If a corporation is found to be a mere agency or surrogate of the Government, "in fact owned by the Government, in truth controlled by the Government and in effect an incarnation of the Government", the Court must not allow the enforcement of Fundamental Rights to be frustrated by taking the view that it is not the Government and therefore not subject to the constitutional limitations. We are clearly of the view that where a corporation is an instrumentality or agency of the Government, it must be held to be an 'authority' within the meaning of Article 12 and hence subject to the same basic obligation to obey the Fundamental Rights as the Government". The reason for including Government Companies in other authorities for purposes of Article 12 is stated in Som Prakash's case, supra, thus.- "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 t....
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....the purview of the Kerala Construction Workers Welfare Funds Act; 1989, made clear that inclusion of Government Companies in 'other authorities' for purposes of Article 12, cannot be extended to other enactments/spheres. The Supreme Court held:-- ".....it appears to us that the appellant-company cannot be held to be a department of the Government. There may be a deep and pervasive control of the Government over the appellant-company and the appellant-company, on such account may be an instrumentality or agency of the Central Government and as such a "State" within the meaning of Article 12 of the Constitution. Even though the appellant-company is an agency or instrumentality of the Central Government, it cannot be held to be a department or establishment of the Government in all cases. Such instrumentality or agency has been held to be a third arm of the Government in Ajay Hasia's case, supra, but it should not be lost sight of that it was only in the context of enforcement of fundamental rights against the action of the Government and its instrumentalities or agencies it was held that such agencies were the third arm of the Government and they cannot a....
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....thorities' are of no assistance to ascertain the meaning of 'other authorities' in Section 26(1)(c). 11.11 In view of the above, it is unnecessary to examine the contention of the petitioners that BEML and ITI should be held to be not 'Authorities' even under Article 12, having regard to the disinvestment policy of the Government and increasing public participation in the share capital of these companies and the subsequent decisions of the Supreme Court in Tekraj Vasandi's case, supra and Chander Mohan Khanna v National Council of Educational Research and Training, wherein the Supreme Court has held that Article 12 should not be stretched so as to bring in every autonomous body which has some nexus with Government within the sweep of the expression 'other authorities'. 12. Re: Reason (ii): 12.1 The meaning to be assigned to words used in a statute should be contextual and not with reference to meaning assigned to the words in a provision of the Constitution of India or other statute which is not pari materia. To interpret the expression 'other authorities' used in Section 26(1)(c) of the Act, we have to examine the context in which the sai....
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....d to refer to a Statutory Corporation till the decision in R.D. Shetty's case, supra, in 1979, was thereafter given the wider meaning as including Government companies also. On the other hand in S.S. Dhanoa v Delhi Municipal Corporation, the term 'Corporation' which would normally include private Corporations also, was given a narrow legal connotation as meaning a Corporation created by the Legislature and not a body or society brought into existence by an act of a group of individuals, for the purpose of Section 21(12) of the Indian Penal Code. 13. Therefore, the expression 'other authority' should be interpreted with reference to the context of elections to Municipal bodies and disqualifications therefrom. The expression should also be understood with reference to the normal meaning that was attached to that expression in 1976 when the statute was enacted and not with reference to subsequent changes. 13.1 What should be the approach in interpreting provisions relating to disqualification, has been indicated by the Supreme Court in Madhukar G.E. Pankakar v Joswant Chobbildas Rajani: "After all, all law is a means to an end. What is the legislative end ....
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.... relevance: "The clear and undoubted object of Article 191(1)(a) to (e) and the provisions of the Representation of the People Act (including Section 10) is the preservation of the purity and integrity of the election process by preventing Government or State employees from taking part in the elections. But, Section 10 appears to con- fine the disqualification insofar as it relates to the employees of Government companies to the top-brass' only if such an uncouth expression may be allowed to creep into the judgment of a Court. Nowadays the activities of the State are so manifold and prolific that the State has been forced in the interests of better management and administration and in order to further the Directive Principles of State Policy, to set up various corporations which are but mere instrumentalities of the State is the principle of Article 191(1)(a) then to be extended to employees of State Corporations also by enacting appropriate laws under Article 191(1)(e)? Or are employees of Public Corporations to be treated differently from employees of the Government? Are not some of them in a better position to exert undesirable pressure than Government Employees? On t....
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....on of which is virtually made of employees of two public sector undertakings (BEML and BGML) and their families. Similarly, the population of Dooravaninagar in Bangalore, is virtually made up of employees of ITI and their families. There is no reason why they should be prevented from having a say in the local self-Government. The employees of industries are normally a disciplined work force and form the backbone of urban population. They, as a category, are interested in the welfare of the area, where they reside. If they are elected, there will be no conflict between their duties and functions, as Councillors and their duties and functions, as employees of a public sector undertaking. The question of their misusing their position or power to any private benefit does not arise. In fact the said public sector undertakings have no say or influence in the affairs of the Municipal Authority. Therefore, they should not be excluded from participation in the running of the local authority unless the statute specifically bars or exclude them. Section 26(1)(c) of the Act is not intended to exclude the employees of the Government companies. The section as it stands applies only to employees ....
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....dent and Vice-President under Article 58 and Article 66 and the provisions of Article 191 of the Constitution of India and clearly observed that Section 26(1)(c) of the Karnataka Municipal Corporations Act is not ultra vires of the Constitution and the companies in which the petitioners are working are companies coming within the meaning of other authority' and further held that the petitioners were holding the office of profit and accordingly answered the reference in the negative with which I fully concur with the reasonings and findings. 4. My learned Senior brother Justice R.V. Raveendran, formulated two important points for adjudication which reads thus: "1. Whether Section 21(1)(c) of the Karnataka Municipal Corporations Act is constitutionally valid? 2. Whether Section 26(1)(c) of the KMC Act disqualifies the employees of Government companies and public sector undertakings from being chosen as Councillors of the Municipal Corporation?" 5. Learned brother observed that there cannot be two views that a Government company is 'other authority' and therefore 'State' within the meaning of Article 12 only for the purpose of Parts III and IV and n....
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....'other authority', then they are disqualified. 9. It deals with the disqualifications for being chosen as a Councillor. In order to disqualify such persons, firstly he should not hold an office of profit either under the Central Government or under the State. Secondly, he should not hold an office of profit under the local or other authority which are under the control of the Government as are declared by the Act and rules. 10. Now the question is, whether the employees of the BEML and Indian Telephone Industries are holding the office of profit and the Public Sectors do not come within the meaning of other authority. Insofar as, this aspect is concerned, the matter has stood at rest by the Apex Court in D.R. Gurushanthappa's case, supra, and also in Ajay Hasia's case, supra, where the Public Sector comes within the meaning of 'other authority' as defined under Article 12 of the Constitution of India. 11. Article 12 of the Constitution of India reads thus: "12. Definition.--In this part, unless the context otherwise requires, "the State" includes the Government and Parliament of India and the Government and the Legislature of each of the ....
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....h cases, the probability that Acts relating to the same subject-matter were actuated by the same policy is very high for the Acts were enacted by the same men at almost the same time. This, of course, is subject to one overriding consideration that, unless the two enactments clearly indicate two different considerations. If the language of the two statutes in all respects is identical, no question of construing one Act with the assistance of the other Act can arise. It is only where one Act is ambiguous or some provision appears to be of doubtful meaning that the assistance is sought from another statute in pari materia to remove the doubt or ambiguity. It is only in such circumstances that assistance in ascertaining the meaning of an enactment is permitted under this rule to be obtained by comparing its language with the words given in an earlier statute relating to the same subject. English Income Tax Act is not in pari materia with Indian Act. But where different statutes deal with identical subjects at different times or deal with a person or thing for same purpose, they are in pari materia and they should be taken and considered together as one system and as explanatory of eac....
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....se analogous to the less general. The ejusdem generis doctrine has been described in the words of Lopes L.J., in Smelting Co. of Australia v Commissioner of Inland Revenue, as meaning "that where general words immediately follow or are closely associated with specific words, their meaning must be limited by reference to the preceding words". Ejusdem generis is not a rule of law, but a rule of construction, which enables a Court to ascertain the intention of the legislature when the intention is not clear and does not warrant the Court, the Court in subverting or defeating the legislative will by confining the operation of a statute within narrower limits than intended by the law makers. It should be resorted to not for the purpose of defeating the intention of the legislature but for the purpose of elucidating its words and giving effect to its intention. It is based on the idea that if the legislature intended its general words to be used in an unrestricted sense so as to embrace the objects, persons or things, covered by the particular words, it would not have taken the trouble of using the particular words at all. Whether the rule of ejusdem generis should be applied t....
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....ioners, or other authority legally entitled to or entrusted by the Government with the control or management of a municipal or local fund. It is clear that a Municipality is a "Local Authority", a District Board is a "Local Authority", a body of Port Commissioners is a "Local Authority" and likewise any authority which is given by the Government the power to control or manage a Municipal Fund or a Local Fund is a Local Authority. The definition of "Local Authority" can be divided into two parts. The first part is specific and mentions certain authorities. The second part is generic and covers any other authority legally entitled to or entrusted by Government with the control and management of a municipal or local fund. In actual practice, it is the second part which is more important and a large number of authorities have been created in the field of local self-Government and other fields. The most important test for deciding whether or not an authority is a local authority or not within the meaning of Section 3(31) of the General Clauses Act is that the authority must be legally entitled to or entrusted by the Government with the control a....
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....ure, it may be necessary to read "and" in place of the conjunction "or", and vice versa." Therefore, ultimately it is the intention of the legislature that has to be given effect to under which the petitioners have been qualified according to the interpretation of Section 26(1)(c) of the KMC Act. 22. In P. Ramanatha Aiyar's, The Law Lexicon", the Encyclopaedic Law Dictionary, 1997 Edition at page 1141, the word 'Local Authority' is defined as follows: "Local Authority" means any body of persons for the time being invested by law with the control and administration of any matters within a specified local area. In the same book at page 1381, the expression "other authority" is defined which reads as follows: "The expression 'other authorities' includes all public authorities, that is, authorities created by a statute endorsed with powers and functions in a given field of activity and for the control thereof, and having the power to make their own rules and regulations, having the force of law". 23. In the case on hand, the Public Sector is constituted under an enactment of the Parliament empowerin....
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....k fit to impose and may, in the case of contravention of any such condition, limitation or restriction, rescind or withdraw such approval, sanction, consent, confirmation, recognition, direction or exemption. (2) Save or otherwise expressly provided in this Act, every application which may be or is required to be made to the (Central Government or Company Law Board) under any provision of this Act.- (a) in respect of any approval, sanction, consent, confirmation or recognition to be accorded by that Government (or Board) to, or in relation to, any matter; or (b) in respect of any direction or exemption to be given or granted by that Government (or Board) in relation to any matter; or (c) in respect of any other matter, shall be accompanied by such fee, as may be prescribed: Provided that different fees may be prescribed for application in respect of different matters or in case of applications by companies, for applications by different classes of companies". Section 637-A enables the Central Government to accord approval in respect of the matters provided. Section 642 of the Companies Act reads thus: "642. (1) In addition to the powers conferred by Section ....
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....ear that by virtue of the provisions of the Companies Act read with the Articles of Association constituted, even the services of the workmen are controlled by the company. It further makes clear within the ambit of the company, the rules framed thereunder, the companies are exercising their sovereign powers so as to control its employees in a particular manner. Therefore, there is no ambiguity in the language and therefore, cannot be said that the companies cannot exercise any sovereign powers in respect of their employees or workmen. 27. The, important question that has to be examined is whether by virtue of the enactments of the Central and State Governments, the Public Sectors are functioning under the control and authority of the Government, in order to consider whether the employees of BEML and ITI are holding the office of profit or not. Article 245 of the Constitution of India reads as under: "245. Extent of laws made by Parliament and by the Legislatures of States.--(1) Subject to the provisions of this Constitution, Parliament may make laws for the whole or any part of the territory of India, and the legislature of a State may make laws for the whole or any part ....
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....vernment; (b) in the service or pay of a local authority, a corporation established by or under a Central, Provincial or State Act or a Government company as defined in Section 617 of the Companies Act, 1956". The definition makes it clear that even a person working in any of the local authority or in a Government Company is deemed to be a public servant. 31. Similarly in "The Karnataka Lokayukta Act, 1984", Section 2(6) defines 'Government Servant' as follows.- "Government Servant" means a person who is a member of the Civil Services of the State of Karnataka or who holds a civil post or is serving in connection with the affairs of the State of Karnataka and includes any such person whose services are temporarily placed at the disposal of the Government of India, the Government of another State, a local authority or any person whether incorporated or not, and also any person in the service of the Central or another State Government or a local or other authority whose services are temporarily placed at the disposal of the Government of Karnataka. Section 2(12) defines "Public Servant". The relevant sub-sections read thus: "Pu....