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TMI Blog2003 (5) TMI 359X X X X Extracts X X X X X X X X Extracts X X X X ..... ved in the matter? Whether in a case of this nature the liability of the State of Bihar, if any, can be shifted to the Union of India? Held that:- The High Court may strive to dispose of all liquidation proceedings in respect of the Government companies owned and controlled by the State of Bihar as expeditiously as possible. For the said purpose and/or purposes ancillary to or incidental therewith, it may pass an interim order and/or orders by way of sale and/or disposal of the properties belonging to such public sector undertaking and/or Government companies or to take such measure or measures as it may deem fit and proper. For the aforementioned purposes a committee not consisting of more than three members chaired by a retired High Court Judge or a sitting District Judge may be appointed who may scrutinize the assets and liabilities of the companies and submit a report to the High Court as expeditiously as possible preferably within three months from the date of constitution of the committee. The terms and conditions for appointment of the said Committee may be determined by the High Court. All expenses in this behalf shall be borne by the State of Bihar. The High Court shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... From January 2000 in Headquarter. In Unit from April 1992 476 6. Bihar State Leather Development Corpn. 471 From March 1993 13 6a. Bihar Finished Leathers 35 Sl. No. Name of Public Undertaking No. of Employees Date from which salary is due Nos. of Death of Employees 7. Bihar State Industrial Development Corporation 1551 In Headquarters from July 2001 in Unit from Feb. 1993 125 8. Bihar State Electronic Corporation 157 In Headquarter up to date. In Unit from April 1998 5 9. Bihar State Vastraya Corporation 50 Nov.-96 Nil 10. Bihar State Film Development & Financial Corporation 8 Aug.-02 Nil 11. Bihar State Fruit & Vegetable Development Corporation 16 From Aug.-94 1 12. Bihar State Seed Development Corpn. 137 From May 1999 5 13. Bihar State Fisheries Development Corporation 42 Before May 2000 due of 32 to 40 months 5 14. Bihar State Food & Civil Supplies Corpn. 1716 Pending from till 40 months 325 15. Bihar State Panchayati Raj Financial Corpn. 130 From March 1996 7 16. Bihar State Construction Corpn. 657 In Headquarter from January 1995. In Unit from January 1992 55 17. Bihar State Road Transport Corporation 5580 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Corporation 13. Bihar State Minerals Development Corporation 14. Bihar State Housing Board 15. Bihar State Police Building Construction Corporation 16. Bihar State Bridge Construction Corporation 17. Bihar State Electricity Board 18. Bihar State Hydro-Electric Power Corporation 19. Patna Industrial Area Development Authority 20. North Bihar Industrial Area Development Authority 21. Darbhanga Industrial Area Development Authority 22. Patna Regional Development Authority 23. Muzaffarpur Regional Development Authority 24. Darbhanga Regional Development Authority 25. Gaya Regional Development Authority 26. Bhgalpur Regional Development Authority 27. Bihar State Water & Sewerage Board 28. Bihar State Minorities Finance Corporation 29. Bihar State Export Corporation, and 30. Tenughat Vidyut Corporation." As regards the Bihar State Road Transport Corporation, it is contended that 50 per cent of salary was paid to the employees as directed by this Court in Civil Appeal No. 7290 of 1994. The State contends that with a view to clear the dues, the Corporation would require approximately a sum of Rs. 160.35 crores. 5. However, in relation to the 16 Undertakings, according ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at there is no report regarding suicide or death due to starvation of any of the employees of the Corporation. It is averred: ". . .The Managing Director of the Bihar Panchayati Raj Finance Corporation had initially reported that 3 employees of the Corporation had died, but had not given any details about the date and cause of their deaths. In his subsequent report the Managing Director reported that there was no report regarding the suicide or death due to starvation of any employee of the corporation. The Managing Director of the Bihar State Sugar Corporation had initially reported that 4 employees of the Corporation had died for want of proper treatment. In this subsequent report the Managing Director has reported that the employees' Union has submitted a list of 241 employees who have died or become disabled. Similarly, the Company Secretary of the Bihar State Seeds Corporation had initially reported that 4 employees of the Corporation have died during the period when salary was not paid. Subsequently, the Company Secretary has reported that 5 employees of the Corporation have died for want of proper treatment. However, in view of the discrepancy in the two reports of these co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment of the State of Bihar. The allegations of the writ petitioner to the effect that there had been starvation deaths and/or suicide by the employees of the public sector undertakings are correct. 12. Mr. Shanti Bhushan, learned senior counsel appearing on behalf of the State of Bihar, would submit that having regard to the magnitude of the problem, it would be just and proper if liability is directed to be met to the extent of 80 per cent by the Union of India and that the State Government will bear the burden to the extent of 10 per cent thereof and the remaining may be realised from the sale of properties belonging to the respective companies. The learned counsel would submit that pursuant to or in furtherance of a decision of the Full Bench of the Patna High Court in C.W.J.C. No. 5015 of 1996, liquidation proceedings of the Government companies have been initiated and they are pending before the Company Judge of the Patna High Court. Mr. Shanti Bhushan would urge that having regard to the well-settled principle of law that a company registered under the Indian Companies Act is a juristic person, its rights and liabilities must be determined in terms thereof and not de'ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... menities. Non-payment of lawful salary to the employees, Mr. Mishra would submit, would fall within the definition of 'forced labour' which is prohibited by Article 23 of the Constitution of India. In support of his contentions, Mr. Mishra placed strong reliance on People's Union for Democratic Rights v. Union of India [1982] 3 SCC 235, Board of Trustees of the Port of Bombay v. Dilipkumar Raghvendranath Nadkarni [1983] 1 SCC 124 and Olga Tellis v. Bombay Municipal Corpn. [1985] 3 SCC 545. 15. Ms. Hingorani, the petitioner appearing in person, would contend that the State cannot escape its liability in the matter of payment of salaries to its own employees; although ostensibly they are working in the companies incorporated under the Indian Companies Act. 16. According to the petitioner starvation deaths and/or commission of suicide by the employees of the State owned corporation being admitted, this Court should issue interim directions for payment of salaries to the employees. Ms. Hingorani would contend that the Government companies or corporations will have to discharge their constitutional obligations in terms of article 21 of the Constitution of India. In support of the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SCC 489 : [1979] 3 SCR 1014) a three-Judge Bench of this Court laid down that corporations created by the Government for setting up and management of public enterprises and carrying out public functions, act as instrumentalities of the Government; they would be subject to the same limitations in the field of constitutional and administrative laws as the Government itself, though in the eye of the law they would be distinct and independent legal entities. There, this Court was enforcing the mandate of article 14 of the Constitution against the respondent - a Central Government corporation. Managing Director, U.P. Warehousing Corpn. v. Vijay Narayan Vajpayee ([1980] 3 SCC 459 : 1980 SCC (L&S) 453 : [1980] 2 SCR 773) dealt with a case of dismissal of the respondent employee of the appellant Corporation in violation of the principles of natural justice. There also the Court held the Corporation to be an instrumentality of the State and extended protection of articles 14 and 16 of the Constitution to the employee taking the view that when the Government is bound to observe the equality clause in the matter of employment the corporations set up and owned by the Government are equally b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia, [1988] 3 SCC 105 : 1988 SCC (L&S) 687), Lucknow Development Authority v. M.K. Gupta ([1994] 1 SCC 243), Star Enterprises v. City and Industrial Development Corpn. of Maharashtra Ltd. ([1990] 3 SCC 280). LIC of India v. Consumer Education & Research Centre ([1995] 5 SCC 482) and G.B. Mahajan v. Jalgaon Municipal Council ([1991] 3 SCC 91). We do not propose to burden this judgment by adding to the list and referring to each case separately. We wish to clear the air that the principle, while discharging public functions and duties the Government companies/corporations/societies which are instrumentalities or agencies of the Government must be subjected to the same limitations in the field of public law - constitutional or administrative law - as the Government itself, does not lead to the inference that they become agents of the Centre/State Government for all purposes so as to bind such Government for all their acts, liabilities and obligations under various Central and/or State Acts or under private law." [Emphasis supplied] Thus, the law as stated therein is not of universal application. The ratio of the said decisions must be applied having regard to the fact situation obtai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... National Council of Educational Research & Training [1991] 4 SCC 578 does not lay down the correct law. 24. We are not oblivious of the legal proposition as enunciated in Ramana Dayaram Shetty and SAIL (sic) that even if a Government company is a State within the meaning of article 12 of the Constitution of India as an agency or instrumentality of the State, there does not exist a relationship of principal or an agent and only the action of the said authorities would be State action. 25. The Government companies/public sector undertakings being 'States' would be constitutionally liable to respect life and liberty of all persons in terms of article 21 of the Constitution of India. They, therefore, must do so in cases of their own employees. The Government of the State of Bihar for all intent and purport is the sole shareholder. Although in law, its liability towards the debtors of the Company may be confined to the shares held by it but having regard to the deep and pervasive control it exercises over the Government companies; in the matter of enforcement of human rights and/or rights of the citizen of life and liberty, the State has also an additional duty to see that the rights ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irect legal consequences. Granted, the constitutional may not be "simply" that. No doubt it may figure as something beyond positive law : "a 'mirror reflecting the national soul'," perhaps; an expression of national ideals, aspirations, and values expected, as such, to "preside and permeate the processes of judicial interpretation and judicial discretion" throughout the length and breadth of the national legal order. But had bills of rights not also and always registered as direct, regulatory legislation - as laws to be enforced like other laws - jurists and scholars the world over would not have conducted their debates over the constitutionalization of social rights in the terms that we have grown used to. Constitutions, to be sure, are regulatory laws of a special kind, setting terms and conditions for the making and execution of all other laws. Typically, although not necessarily, some of the terms and conditions are cast in the form of a bill of rights; a list of certain interests of persons, upon whom are conferred what are considered to be legal rights, not just background moral claims, to have these interests at least negatively respected, and may be positively secured and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Economic, Social and Cultural Rights which were adopted by the General Assembly of United Nations on 16-12-1966. The said Act was made by the Parliament "having regard to the changing social realities and growing concern in India and brought about issues relating to Human Rights with a view to bring about greater accountability and transparency in enforcement of laws of the nation." 34. Parts III and IV of the Constitution of India contain a large number of rights which guarantee human rights, some of which are akin to the rights enumerated in International Treaties and Chapters. Article 11 of International Covenant in Economic, Social and Cultural Rights, 1966 reads thus: "1. The States Parties to the present Covenant recognize the right of everyone to an adequate standard of living for himself and his family, including adequate food, clothing and housing, and to the continuous improvement of living conditions. The States Parties will take appropriate steps to ensure the realization of this right, recognizing to this effect the essential importance of international co-operation based on free consent. 2. The States Parties to the present Covenant, recognizing the fundamental r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ented, set of propositions applicable to and conditioned by a concrete stage of social development of the nation and aspirational imperative of the people. India Today - that is the inarticulate major premise of our constitutional law and life. . . ." (p. 772) 38. It is also well-settled that a statute should be interpreted in the light of the International Treaties and Conventions. In Chairman, Railway Board v. Mrs. Chandrima Das AIR 2000 SC 988, this Court stated the law thus :-- "24. The International Covenants and Declarations as adopted by the United Nations have to be respected by all signatory States and the meaning given to the above words in those Declarations and Covenants have to be such as would help in effective implementation of those rights. The applicability of the Universal Declaration of Human Rights and the principles thereof may have to be read, if need be, into the domestic jurisprudence." (p. 997) 39. In 'Human Rights and Indian Values' Justice M. Rama Jois noticed the Ancient Indian Texts in the following words : Samani Prapa Saha Vonnbhaga Samane Yoktray Saha Wo Yunism Arah Nabhimivabhite : "All have equal rights in articles of food and water. The yoke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstructed in several important ways. The 'progressive state', at least in, and for, the South, is now conceived not as a state in its internal relations with its own people but in relation to the global community of foreign investors. A progressive state is one that is a good host state for global capital. A progressive state is one that protects global capital against political instability and market failures. A progressive state is one that represents accountability not so much directly to its peoples, but to the World Bank and International Monetary Fund. A progressive state is one that instead of promoting world visions of a just international order learns the virtues of debt repayment on schedule. Finally, a progressive state is one that gleans conceptions of good governance neither from the histories of struggles against colonization and imperialism nor from its internal social and human rights movements but from the global institutional gurus of globalisation. The construction of 'progress' is animated by a post-Fukuyama world in which there is no other to Capitalism, writ globally large. Of course, the contradictions between democracy and capitalism are once again, recogni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lability of resources in society. Is the Right to Food about good governance? Good governance is negotiable, Human Rights are not. The central concept for Human Rights is the concept of "violation", referring to the suppression of vulnerable groups and individuals, whereas the concepts of good governance all too often deal with political theory and statistical indicators. If a country has the resources, but people get marginalized or continue in deprivation, this is not bad government, but oppression, intentional or not. Is the Right to Food realized if nobody is hungry anymore? Not necessary. The Right to Food not only means that hunger and malnutrition are eradicated, but that future malnutrition can be eradicated by court action or other comparable mechanisms holding the state accountable on its obligations under the Right to Food." 42. In Kishen Pattnayak v. State of Orissa [1989] Supp. (1) SCC 258, a Division Bench of this Court while considering poverty and starvation deaths in drought prone districts of Kalahandi and Koraput in the State of Orissa having regard to the report of the District Judge of Kalahandi noticed that Natural Calamities Committee had been constituted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l requisite to the right to live should be deemed to have been guaranteed as a fundamental right. As is enjoined in the Directive Principles, the State should be deemed to be under an obligation to secure it for its citizens, of course subject to its economic budgeting. In a democratic society as a member of the organized civic community one should have permanent shelter so as to physically, mentally and intellectually equip oneself to improve his excellence as a useful citizen as enjoined in the Fundamental Duties and to be a useful citizen and equal participant in democracy. The ultimate object of making a man equipped with a right to dignity of person and equality of status is to enable him to develop himself into a cultured being...". 46. The term 'life' used in Article 21 of the Constitution of India has a wide and far reaching concept. It includes livelihood and so many other facets thereof. "Life", as observed by Field, J. In Munn v. Illinois [1877] 94 US 113 means something more than mere animal existence and the inhibition against the deprivation of life extends to all those limits and faculties by which life is enjoyed. See Board of Trustees of the Port of Bombay's case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt in S.M.D. Kiran Pasha v. Government of Andhra Pradesh [1990] 1 SCC 328 observed that Article 226 of the Constitution of India would be maintainable also when a right is threatened as contra distinguished from the right when infringed. This Court held: "In the language of Kelsen the right of an individual is either a mere reflex right - the reflex of a legal obligation existing towards this individual; or a private right in the technical sense - the legal power bestowed upon an individual to bring about by legal action the enforcement of the fulfilment of an obligation existing towards him, that is, the legal power. From the above analysis it is clear that in the instant case the appellant's fundamental right to liberty is the reflex of a legal obligation of the rest of the society, including the State, and it is the appellant's legal power bestowed upon him to bring about by a legal action the enforcement of the fulfilment of that obligation existing towards him. Denial of the legal action would, therefore, amount to denial of his right of enforcement of his right to liberty..." It is also well-settled that interpretation of the Constitution of India or statutes would change f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Parliament, in the wording of an enactment, is expected to anticipate temporal developments. The drafter will foresee the future and allow for it in the wording. ****** An enactment of former days is thus to be read today, in the light of dynamic processing received over the years, with such modification of the current meaning of its language as will now give effect to the original legislative intention. The reality and effect of dynamic processing provides the gradual adjustment. It is constituted by judicial interpretation, year in and year out. It also comprises processing by executive officials." 15. At this stage the words of Justice Bhagwati in the case of National Textile Workers' Union v. P.R. Ramakrishnan [1983] 1 SCR 922 at page 956, need to be set out. They are: "We cannot allow the dead hand of the past to stifle the growth of the living present. Law cannot stand still: It must change with the changing social concepts and values. If the bark that protects the tree fails to grow and expand along with the tree, it will either choke the tree or if it is a living tree, it will shed that bark and grow a new living bark for itself. Similarly, if the law fails to respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sensitive to the plight of its own citizens in general and the employee of the public sector undertakings in particular? 53. The court in a situation of this nature is obligated to issue necessary directions to mitigate the extreme hardship of the employees involving violation of human rights of the citizens of India at the hands of the State of Bihar and the Government companies and corporations fully owned or controlled by it. A right to carry on business is subject to compliance of constitutional obligations as also limitations provided for in the Constitution. 54. Financial stringency may not be a ground for not issuing requisite directions when a question of violation of fundamental right arises. This Court has been highlighting this aspect in the matters concerning fundamental rights and maintenance of ecology. See Rural Litigation & Entitlement Kendra v. State of Uttar Pradesh AIR 1987 SC 359, Municipal Council v. Shri Vardichan [1980] 4 SCC 162 and Dr. B.B. Wadehhra v. Union of India AIR 1996 SC 2969. In All India Imam Organization v. Union of India [1993] 3 SCC 584, this Court held: "6. ...Much was argued on behalf of the Union and the Wakf Boards that their financial p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irs. If at an appropriate stage, having regard to its right of deep and pervasive control over the Public Sector Undertakings it had properly supervised the functioning of the Government Companies and take necessary steps to refer the sick companies to BIFR in terms of the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985, the position might have been different. It even failed to take any positive action even after coming to know the starvation deaths and immense human sufferings. 59. The State of India are welfare States. They having regard to the constitutional provisions adumbrated in the Constitution of India and in particular Part IV thereof lying down the Directive Principles of the State Policy and Part IV-A laying down the Fundamental Duties are bound to preserve the practice to maintain the human dignity. 60. We are of the opinion that the State, thus, has made itself liable to mitigate the sufferings of the employees of the public sector undertakings or the Government companies. While passing an interim order, however, it is our duty to take into consideration the immediate hardship which may be faced by the State of Bihar having regard to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the High Court for disbursement of salaries to the employees of the corporations. The amount of Rs. 50 crores be deposited in two instalments. Half of the amount shall be payable within one month and the balance amount within a month thereafter. The High Court shall see to it that the sum so deposited and/or otherwise received from any source including by way of sale of assets of the Government Companies/Public Sector Undertakings be paid proportionately to the concerned employee wherefor, the parties may file their claims before it. 5.The High Court, however, in its discretion may direct disbursement of some funds to the needy employees, on ad hoc basis so as to enable them to sustain themselves for the time being. 6.The rights of the workmen shall be considered in terms of section 529A of the Companies Act. 7.The Central Government is hereby directed to take a decision as regards division of assets and liabilities of the Government companies/public sector undertakings in terms of the provisions of the State Reorganisation Act, 2000. 8.The State of Jharkhand is hereby impleaded as a respondent. Let notice be issued to the newly added respondent. 63. This order shall be subj ..... 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