2009 (3) TMI 1057 - SC - Indian Laws

Summary

Issues Involved:
1. Whether the Uttar Pradesh Ganna Kishan Sansthan (the "Sansthan") is a 'State' within the meaning of Article 12 of the Constitution of India.

Summary:

Issue 1: Whether the Uttar Pradesh Ganna Kishan Sansthan (the "Sansthan") is a 'State' within the meaning of Article 12 of the Constitution of India.

The Supreme Court examined whether the Sansthan, a society registered under the Societies Registration Act, qualifies as a 'State' u/s Article 12 of the Constitution of India. The Sansthan was established by a Government Order dated 4.08.1975 to take over functions previously performed by the Cane Development Department, including training cane-growers to increase sugar production. The management and expenses of the training centers were transferred to the Sansthan, funded by the U.P. Sahkari Ganna Samiti Sangh and Sakkar Vishesh Nidhi.

The respondent, appointed as Computer Officer/Data Processing Officer, challenged the abolition of his post and termination of his services by filing a writ petition. The High Court's Full Bench held that the Sansthan is a 'State' within the meaning of Article 12.

Article 12 defines 'the State' to include the Government and Parliament of India, the Government and legislature of each State, and all local or other authorities within the territory of India or under the control of the Government of India. The Court referred to various precedents, including Rajasthan State Electricity Board v. Mohan Lal, Ajay Hasia v. Khalid Mujib Sehravardi, and Pradeep Kumar Biswas v. Indian Institute of Chemical Biology, to determine the criteria for an entity to be considered a 'State'.

The Court applied the tests from Pradeep Kumar Biswas, which include formation, objects and functions, management and control, and financial aid. The Sansthan was created under a Government charter, managed by a Governing Council dominated by public servants, and substantially financed by the Government. The Sansthan's functions, such as providing scientific training for sugarcane cultivation, were deemed public functions.

The Court noted that the Sansthan's budget was significantly funded by the Government, and its management included government officials. Rule 41 of the Sansthan's Rules allowed the Governor of Uttar Pradesh to issue directives, indicating deep and pervasive State control.

Based on these findings, the Supreme Court concluded that the Sansthan is financially, functionally, and administratively dominated by the Government, qualifying it as a 'State' within the meaning of Article 12. Consequently, the appeal was dismissed with costs assessed at Rs. 50,000.