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2002 (4) TMI 890 - SC - Indian LawsWhether Council for Scientific and Industrial Research (CSIR) is the State within the meaning of Article 12 of the Constitution. Whether a prayer seeking issuance of a mandamus or an order in the nature of mandamus could lie against a company incorporated under the Companies Act wherein the Central and the State Governments held respectively 56 and 32 per cent shares? Held that - Appeal dismissed. As on the material available, we have recorded a positive finding that CSIR is not a society owned or controlled by Government . We cannot ignore that finding solely by relying on the contents of the notification wherein we find the user of relevant expression having been mechanically copied but factually unsupportable. For the foregoing reasons, it is to be opined that Council for Scientific and Industrial Research (CSIR) is not the State within the meaning of Article 12 of the Constitution.
Issues Involved:
1. Whether the Council of Scientific and Industrial Research (CSIR) is a "State" within the meaning of Article 12 of the Constitution. 2. Whether the decision in Sabhajit Tewary v. Union of India should be reconsidered and potentially overruled. Detailed Analysis: 1. Whether CSIR is a "State" within the meaning of Article 12 of the Constitution: The Supreme Court examined the definition and scope of "State" under Article 12 of the Constitution, which includes 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 noted that the definition of "State" is inclusive and not exhaustive, allowing for judicial interpretation to expand its meaning over time. The Court reviewed a series of precedents to determine whether CSIR qualifies as a "State." The analysis included cases such as Rajasthan Electricity Board v. Mohan Lal, Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi, and Ajay Hasia v. Khalid Mujib Sehravardi. These cases established various tests to determine whether an entity is an instrumentality or agency of the government, including factors like financial control, administrative control, and the nature of functions performed. The Court noted that CSIR was created by the Government to promote industrial research and development, and its functions are fundamental to the governance of the country. The management and control of CSIR are significantly influenced by the Government, with the Prime Minister serving as the ex-officio President and other government officials holding key positions. Financially, CSIR relies heavily on government grants, which constitute a substantial portion of its funding. Despite these factors, the Court emphasized that the determination of whether an entity is a "State" requires a cumulative assessment of various factors. The Court concluded that CSIR is indeed an instrumentality of the State, given its creation, functions, financial dependence, and administrative control by the Government. 2. Whether the decision in Sabhajit Tewary v. Union of India should be reconsidered and potentially overruled: The Court revisited the decision in Sabhajit Tewary, where it was held that CSIR is not an "authority" within the meaning of Article 12. The Court noted that subsequent decisions had expanded the interpretation of "State" to include various entities that perform public functions or are under significant government control. The Court observed that the reasoning in Sabhajit Tewary was based on the fact that CSIR was a society registered under the Societies Registration Act and not a statutory body. However, this reasoning was found to be inconsistent with later decisions that focused on the functional and financial control exercised by the Government over such entities. The Court also considered a notification issued under the Administrative Tribunals Act, 1985, which recognized CSIR as a society owned and controlled by the Government. This further supported the conclusion that CSIR should be considered a "State" for the purposes of Article 12. Ultimately, the Court overruled the decision in Sabhajit Tewary, holding that CSIR is a "State" within the meaning of Article 12. The matter was remitted back to the appropriate Bench to be dealt with in light of this decision. Conclusion: The Supreme Court concluded that CSIR is a "State" within the meaning of Article 12 of the Constitution, given its creation, functions, financial dependence, and administrative control by the Government. The decision in Sabhajit Tewary v. Union of India was overruled, and the matter was remitted back to the appropriate Bench for further proceedings consistent with this judgment.
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