BHARAT ALUMINIUM CO.LTD. - High Court of Delhi


Writ Petition (Civil) No. 3043/1991 Decided On: 23.07.2008

Appellants: Asulal Loya
Respondent: Union of India (UOI) and Ors.

Hon'ble Judges:
Sanjiv Khanna, J.

For Appellant/Petitioner/Plaintiff: Narottam Vyas, Adv.
For Respondents/Defendant: A.K. Verma, Adv. for respondents 2 and 3

JUDGMENT Sanjiv Khanna, J.
1.The respondent-Bharat Aluminium Company Limited is no longer a Government of India undertaking and was privatized pursuant to a tripartite share purchase agreement dated 2nd day of March, 2001. The petitioner, Mr. Asulal Loya had filed the present writ petition on 28th September, 1991 challenging his order of termination of service by the respondent company. A preliminary issue has been raised by the respondent company that the present writ petition is no longer maintainable and no relief can be granted against the respondent company as it is not a 'State' or 'other authority' under Article 12 of the Constitution of India. The petitioner, on the other hand, contends that the writ petition when it was originally filed against the respondent company was maintainable and it would be unjust and unfair to 'non-suit' the petitioner after so many years. It is also stated that ordinary rule of litigation is that rights of the parties stand crystalised on the date of commencement of litigation and right to relief should be decided with reference to the date on which the petitioner entered portals of the Court. This principle was applied by the Supreme Court in the case of Beg Raj Singh v. State of U.P. and Ors. reported in MANU/SC/1183/2002, in which it was observed as under:

A petitioner, though entitled to relief in law, may yet be denied relief in equity because of subsequent or intervening events, i.e. the events between the commencement of litigation and the date of decision. The relief to which the petitioner is held entitled may have been rendered redundant by lapse of time or may have been rendered incapable of being granted by change in law. There may be other circumstances which render it inequitable to grant the petitioner any relief over the respondents because of the balance tilting against the petitioner on weighing inequities pitted against equities on the date of judgment.

2. The aforesaid decision is not directly on the point in issue in the present case. The question which requires consideration is whether in the present writ petition any relief can be granted to the petitioner if at the time when judgment is pronounced, the respondent in the litigation is not a State within the meaning of Article 12 of the Constitution of India. I may note here that Article 367 of the Constitution stipulates that provisions of General Clauses Act, 1872 can be applied for interpretation of the Constitution. However, Section 6 of the General Clauses Act, it has been helds not applicable to the Constitution of India. Allahabad High Court in Seth Jagamander Das and Ors. v. State reported in MANU/UP/0039/1951 has held that Section 6 applies where any Central Act or Regulation is repealed. Constitution of India is not a Central Act or Regulation. The said decision and observations in this regard of Allahabad High Court were approved by the Supreme Court in the appeal preferred by State of Uttar Pradesh against said decision, titled State of Uttar Pradesh v. Seth Jagamander Das reported in MANU/SC/0170/1954. Moreover, normally inchoate rights which have not matured, do not survive. A mere hope or expectation does not confer any right.

3. It is fairly well settled that a writ petition is not maintainable against a private limited company or a public limited company in which the State does not exercise all pervasive control. In Binny Limited and Anr. v. V. Sadasivan and Ors. reported in MANU/SC/0470/2005, the Supreme Court has held that a writ petition under Article 226 of the Constitution is normally issued against public authorities and can also be issued against private authorities when they are discharging public functions and the decision which is sought to be corrected or enforced must be in discharge of a public function. In the present case, the issues and questions involved do not relate to public functions.

4. At this stage, I may note a decision of the Supreme Court in State of U.P. v. Mohd. Nooh reported in AIR 1958 SC 86 in which it was observed that Article 226 of the Constitution of India does not have retrospective effect.

5. A single Judge of this Court in Writ Petition (Civil) No. 5236/1997 titled BALCO Officer's Association and Anr. v. Bharat Aluminium Company Limited and Anr. had upheld a similar preliminary objection raised by the respondent company, observing as under:

Learned Counsel for the respondents points out that during the pendency of these proceedings, the Bharat Aluminium Company has been pravitised(sic), in that all the shares have been transferred to Sterlite Industries India Limited. As a consequence it is no longer amenable to writ jurisdiction of this Court. In view of this statement and having considered the record, the writ petition is disposed off. It is however open to the petitioner to approach the concerned legal forum for seeking redressal of any grievance, in accordance with law. The writ petition and all pending applications are disposed off.

6. A Division Bench of Bombay High Court was also to examine the same preliminary issue in Writ Petition No. 1461/2003 titled Tarun Kumar Banerjee v. Bharat Aluminium Company Limited and Anr. and the said writ petition was dismissed holding as under:

1. Both the petitions were filed against Bharat Aluminium Co. Ltd. when the petitions were filed, it was a Government of India enterprise. We are told by the Respondent that they had filed an affidavit on 22-3-1996 thereby pointing out that Bharat Aluminium Co. Ltd. has been privatized and share of more than 50% have been transferred to Sterlit Industries India Ltd. and as a consequence Bharat Aluminium Company Ltd is not a state and is not amenable to writ jurisdiction of this Court.

2. In view of this submission we dispose of both the petitions while granting the petitioner liberty to approach any other forum for redressal of their grievance if so advised. The time spent by the petitioners in prosecuting these proceeding shall be taken into consideration for the purpose of limitation in case the petitioner choose any such remedy where the question of limitation would be relevant.

(Bilal Nazki, J.) 
(A.P. Bhangale, J.)

7. Privatisation of the respondent company was challenged by BALCO Employees' Union (Regd.) before the Supreme Court. One of the grounds for challenge was that pursuant to dis-investment, the respondent company will become a private company and will not, therefore, be amenable to writ jurisdiction. The said challenge was considered and rejected by the Supreme Court in the following words:

47. Process of dis-investment is a policy decision involving complex economic factors. The courts have consistently refrained from interfering with economic decisions as it has been recognised that economic expediencies lack adjudicative disposition and unless the economic decision, based on economic expediencies, is demonstrated to be so violative of constitutional or legal limits on power or so abhorrent to reason, that the courts would decline to interfere. In matters relating to economic issues, the Government has, while taking a decision, right to 'trial and error' as long as both trial and error are bona fide and within limits of authority. There is no case made out by the petitioner that the decision to disinvest in BALCO is in any way capricious, arbitrary, illegal or uninformed. Even though the workers may have interest in the manner in which the Company is conducting its business, inasmuch as its policy decision may have an impact on the workers' rights, nevertheless it is an incidence of service for an employee to accept a decision of the employer which has been honestly taken and which is not contrary to law. Even a government servant, having the protection of not only Articles 14 and 16 of the Constitution but also of Article 311, has no absolute right to remain in service. For example, apart from cases of disciplinary action, the services of government servants can be terminated if posts are abolished. If such employee cannot make a grievance based on Part III of the Constitution or Article 311 then it cannot stand to reason that like the petitioners, non-government employees working in a company which by reason of judicial pronouncement may be regarded as a State for the purpose of Part III of the Constitution, can claim a superior or a better right than a government servant and impugn its change of status. In taking of a policy decision in economic matters at length, the principles of natural justice have no role to play. While it is expected of a responsible employer to take all aspects into consideration including welfare of the labour before taking any policy decision that, by itself, will not entitle the employees to demand a right of hearing or consultation prior to the taking of the decision.

48. Merely because the workmen may have protection of Articles 14 and 16 of the Constitution, by regarding BALCO as a State, it does not mean that the erstwhile sole shareholder viz. Government had to give the workers prior notice of hearing before deciding to disinvest. There is no principle of natural justice which requires prior notice and hearing to persons who are generally affected as a class by an economic policy decision of the Government. If the abolition of a post pursuant to a policy decision does not attract the provisions of Article 311 of the Constitution as held in State of Haryana v. Des Raj Sangar on the same parity of reasoning, the policy of dis-investment cannot be faulted if as a result thereof the employees lose their rights or protection under Articles 14 and 16 of the Constitution. In other words, the existence of rights of protection under Articles 14 and 16 of the Constitution cannot possibly have the effect of vetoing the Government's right to disinvest. Nor can the employees claim a right of continuous consultation at different stages of the dis-investment process. If the dis­investment process is gone through without contravening any law, then the normal consequences as a result of dis-investment must follow.

8. A somewhat similar plea was also taken in All India ITDC Workers' Union and Ors. v. ITDC and Ors. reported in MANU/SC/8592/2006 but following the decision in BALCO's Employees Union (Regd.) case(supra), the contention was rejected by observing as under:

23. We have given our thoughtful consideration to the rival submissions made by the respective counsel appearing for the respective parties. In our opinion, the present writ petitions filed by the employees merit to be dismissed since dis-investment was a policy decision of the Government of India. this Court also has held that the said policy decision should be least interfered with in judicial review and that the government employees have no absolute right under Articles 14, 21 and 311 of the Constitution of India and that the Government can abolish the post itself. In the present case, the petitioners are not government servants and are merely employees of a public sector undertaking. This apart, the service conditions of the petitioners are being protected under the new management on the dis-investment of the Hotel and the fact that other hotels are also in an advanced stage of dis-investment in pursuance of the policy decision taken by the Government of India for dis-investment of the hotel units. We see no reason to interfere with the aforesaid decision. In case ultimately the petitioners are aggrieved by any aspect of terms of reference and formalisation of agreement and completion of dis-investment it is always open to the petitioners to approach the courts for redressal of their grievances.

24. x x x x

25. x x x x

26. x x x x

27. It is also pertinent to notice that ITDC has not participated in the dis-investment process as the same was carried out by the Ministry of dis-investment, Government of India. The safeguards regarding the service conditions of the employees have been duly provided in the transfer document i.e. demerger scheme and share purchase agreement. this Court also in BALCO Employees' Union (Regd.) v. Union of India3 held that the employees of the company registered under the Indian Companies Act do not have any vested right to continue to enjoy the status of the employee of an instrumentality of the State.

9. It is inherent right of every person to bring a suit of civil nature unless it is expressly or impliedly barred. Similarly, where pre-requisites of Industrial Disputes Act, 1947 are satisfied, proceedings can also be initiated under this Act. The petitioner is, therefore, not left remediless. On the question of limitation, Section 14 of the Limitation Act, 1963 gives protection and where the conditions of the said section are satisfied, exemption for the period during which a writ petition had remained pending can be granted. Reference in this regard can be made to the observations of the Bombay High Court in the case of Tarun Kumar Banerjee (Supra).

10. In these circumstances, the present writ petition is dismissed without going into the merits of the matter upholding the preliminary objection raised by the respondent company that it is not a State and, therefore, not amenable to writ jurisdiction. It is, however, observed that the petitioner is at liberty to approach any forum for redressal of his grievance, if so advised and the time spent by him in these proceedings shall be taken into consideration for the purpose of limitation. In the facts and circumstances of the case, there will be no order as to costs.

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