2024 (5) TMI 1190 - SC - Indian Laws

Writ jurisdiction of the High Court post privatization - respondent No.3(AIL) taken over by a private corporate entity - non-suit on account of the fact that during pendency of their writ petitions - nature of the employer changed from a Government entity to a private entity - delay in disposal of the writ petition could be treated a valid ground to sustain the claim of the appellants even against the private entity. Whether respondent No.3(AIL) after having been taken over by a private corporate entity could have been subjected to writ jurisdiction of the High Court? - HELD THAT - The employee-writ petitioner filed a writ petition before the Delhi High Court to challenge his termination wherein, a preliminary objection was raised regarding maintainability of the writ petition on the ground that during pendency of the proceedings, the company had changed hands and no longer retained the characteristic of a State or Other authority as defined under Article 12 of the Constitution of India. The assertion of the writ petitioner was that the petition was maintainable against the respondent on the date it was filed. As per the writ petitioner, the rights and obligations of the parties stood crystallized on the date of commencement of litigation and thus, the reliefs should be decided with reference to the date on which the party entered the portals of the Court. Various High Courts across the country have taken a consistent view over a period of time on the pertinent question presented for consideration that the subsequent event i.e. the disinvestment of the Government company and its devolution into a private company would make the company immune from being subjected to writ jurisdiction under Article 226 of the Constitution of India, even if the litigant had entered the portals of the Court while the employer was the Government. Whether the appellants herein could have been non-suited on account of the fact that during pendency of their writ petitions, the nature of the employer changed from a Government entity to a private entity? - HELD THAT - The issue about exercise of extra ordinary writ jurisdiction under Article 226 of the Constitution of India would arise only on the date when the writ petitions were taken up for consideration and decision. The respondent No.3(AIL)- employer was a government entity on the date of filing of the writ petitions, which came to be decided after a significant delay by which time, the company had been disinvested and taken over by a private player. Since, respondent No.3 employer had been disinvested and had assumed the character of a private entity not performing any public function, the High Court could not have exercised the extra ordinary writ jurisdiction to issue a writ to such private entity. The learned Division Bench has taken care to protect the rights of the appellants to seek remedy and thus, it cannot be said that the appellants have been non-suited in the case. It is only that the appellants would have to approach another forum for seeking their remedy - the issue decided against appellant. Whether the delay in disposal of the writ petition could be treated a valid ground to sustain the claim of the appellants even against the private entity? - HELD THAT - The delay in disposal of the writ petitions could have been a ground to continue with and maintain the writ petitions because the forum that is the High Court where the writ petitions were instituted could not have issued a writ to the private respondent which had changed hands in the intervening period. Hence, the question is also decided against the appellants. The view taken by the Division Bench of the Bombay High Court in denying equitable relief to the appellants herein and relegating them to approach the appropriate forum for ventilating their grievances is the only just and permissible view - there are no reason to take a different view from the one taken by the Division Bench of the Bombay High Court in sustaining the preliminary objection qua maintainability of the writ petitions preferred by the appellants and rejecting the same as being not maintainable. Appeal dismissed.

Issues Involved:
1. Maintainability of writ petitions against a privatized entity.
2. Impact of the change in the nature of the employer during the pendency of the writ petitions.
3. Effect of delay in disposal of writ petitions on the claims of the appellants.

Summary:

Issue 1: Maintainability of Writ Petitions Against a Privatized Entity
The Supreme Court examined whether respondent No.3 (AIL), after being privatized, could be subjected to writ jurisdiction of the High Court. The Court concluded that once AIL was taken over by a private entity, it ceased to be a "State" or "other authority" within the meaning of Article 12 of the Constitution of India. Consequently, it could not be subjected to writ jurisdiction under Article 226. The Court referenced the case of Pradeep Kumar Biswas v. Indian Institute of Chemical Biology (2002) 5 SCC 111, which outlined the parameters for an entity to be considered a "State." The Court held that AIL, after privatization, did not meet these parameters.

Issue 2: Impact of Change in Employer's Nature During Pendency
The Court addressed whether the appellants could be non-suited due to the change in the employer's nature from a government entity to a private entity during the pendency of their writ petitions. The Court decided that the High Court could not exercise extraordinary writ jurisdiction to issue a writ to a private entity not performing any public function, even if the writ petitions were filed when the employer was a government entity. The Court upheld the Division Bench's decision to protect the appellants' rights to seek remedies in another forum.

Issue 3: Effect of Delay in Disposal on Claims
The Court examined whether the delay in the disposal of the writ petitions could be a valid ground to sustain the appellants' claims against the private entity. The Court decided that the delay could not justify maintaining the writ petitions, as the High Court could not issue a writ to a private entity that had changed hands. The Court emphasized that the appellants' rights were protected, allowing them to approach another forum for their grievances.

Conclusion:
The Supreme Court affirmed the Bombay High Court's decision, which denied equitable relief under Article 226 of the Constitution to the appellants and directed them to seek remedies in an appropriate forum. The Court noted that Section 14 of the Limitation Act, 1963, would protect the appellants regarding the issue of limitation if they chose to approach another forum. The appeals were dismissed with no order as to costs.

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