PRADYUT BORDOLOIversusSWAPAN ROY

                           PRADYUT BORDOLOI                                        A
                                       v.
                                SWAPAN ROY

                            DECEMBER 12, 2000

              [R.C. LAHOTI AND SHIVA RAJ V. PATIL, JJ.]                            B


      Constitution of India, 1950-Article 191 (l}(a)-Representation of
People Act, 1951--Section 116A, 98(b), JO and 80181-Election petition-
Respondent employed as clerk in Coal India ltd.- -Whether can be disqualified C
to contest election on the ground that he is holding office of profit- -Held,
no- -Respondent was not holding an office of profit under the Government of
India as the Government of India does not exercise any control on appointment,
removal, service conditions and functioning of the respondent- His being a
clerk in Coal India ltd. cannot bring any influence or pressure on him in
his independent functioning as a member of legislative Assembly- -Assam D
legislative Members (Removal and Disqualifications) Act, 1950.

      Words and Phrases· - 'office of profit'-Meaning of

       Respondent, an employee of Coal India Ltd., holding the post of Clerk
Grnde I, filed his nomination paper for election to Legislative Assembly.' A'      E
filed a complaint against the candidature of the respondent saying that the
respondent being an employee of Coal India Ltd., was holding an office of profit
under the Government of India and thus was disqualified from contesting
election under Article t 91 of the Constitution of India and under Section to
of Representation of People Act, and was performing managerial functions
in a company wherein the Government of India had not less than 25% shares.         F
Returning Officer upheld the objections and the nomination paper of the
respondent was rejected. In the legislative assembly elections appellant was
declared elected.

      Respondent filed election petition before the High Court challenging
appellant's election. High Court allowed the petition, holding the election of G
the appellant void on the ground that the nomination paper of the respondent
was improperly rejected on the ground of disqualification because he was
neither holding an office of profit under Government of India within the
meaning of Article 19l(l)(a) nor was he a managing agent, manager or
secretary of any company or corporation in the capital of which the H
                                     525
    526                        SUPREME COURT REPORTS [2000] SUPP. 5 S.C.R.

A Government of India had not less than 25% shares. In appeal to this Court,
    it was disputed that Coal India Ltd. is a private limited company with 100%
    share owned by Central Government, and that the President of lndi& does not
    have any control in the matters relating to appointment, removal and
    disciplinary control over the incumbents holding the posts below the Board
B   level, and that the salaries, emoluments and perks of such employees were
    payable from the funds of the Company which was not remunerated or
    augmented by the Central Government

          Dismissing the appeal, the Court

           HELD : No fault can be found with the finding arrived at by the High
C   Court that the respondent was not holding an office of profit under the
    Government of India and therefore no disqualification attached to him under
    Article 191(1) (a) of the Constitution. The Government of India do not exercise
    any control on appointment, removal, service conditions and functioning of
    the respondent. The respondent does hold an 'office' and there is 'profit'
D   attached to the office but such office of profit is not 'under the Government of
    India'. His being a clerk in Coal India Ltd. does not and cannot bring any
    influence or pressure on him in his independent functioning as a member of
    Legislative Assembly. The respondent was merely a Clerk Grade I.
    Occasionally in the absence of his senior officer on account of leave or
    absence, he exercised some supervis11ry function over his subordinates, but
E   this would not make him a manager of the Company. The respondent did not
    incur a disqualification under Section I 0 of Representation of people Act also.
    As the respondent's nomination paper was improperly rejected, the appellant's
    election was liable to be declared void without proof of the result of the election,
    in so far as it concerns the returned candidate, having been materially affected.
F                                                             [533-G-H; 534-A, B, Cl

           2. The totality of the facts and circumstances reviewed in the light of
    the provisions of relevant Act, if any, would lead to an inference being drawn
    ifthe office held is under the Government The inquisitive over-view-eye would
    finally query: on account of holding of such office would the Government be
G   in a position to so influence him as to interfere with his independence in his
    functioning as a member of Legislative Assembl} and I or would his holding
    of the two offices-one under the Government and the other being a member of
    the Legislative Assembly, involve a conflict of interests inter-se? This is how
    the issue has to be approached and resolved. [533-E, Fl

H         Maulana Abdul Shakur v. Rikhab Chand & Anr., 119581 SCR 387;
                 PRADYCT BORDOLOI v. SWAPAN ROY [LAHOTI, J.]                    527
       M. Ramappa v. Sangappa & Ors., (1959) SCR 1167; Guru Govind Basu v.             A
       Shankari Prasad Ghoshal & Ors., (1964( 4 SCR 311 and Shivamurthy Swamy
       Jnamdar & Anr. v. Agadi Sanganna Andanappa & Anr., (1971( 3 SCC 870,
       relied on.

            Madhuker G.E. Pankakar v. Jaswant Chobbi/das Rajani & Ors., (1967)
       3 SCR 832; Satrucharla Chandrasekhar Raju v. Vyricherla Pradeep Kumar           B
       Dev & Anr., (1992( 4 SCC 404; D.R. Guru Shanthappa v. Abdul Khuddus
       Anwar & Ors., I1969( 3 SCR 425; Ashok Kumar Bhattacharya v. Ajoy Biswas
       & Ors., (1985( 2 SCR 50 and Aklu Ram Mahto v. Rajendra Mahto, (1999( 3
       sec 541, referred to.
             CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1001 of2000.               C
             From the Judgment and Order dated 3.12.99 of the Guahati High Court
       at Assam in E.P. No. 4 of 1998.

             G.L. Sanghi, Sr. Adv., Ms. Krishna Sarma, N.J. Luwang, Atul Kumar and     D
       Satish Vig for the Appellant.

             The Judgment of the Court was delivered by

             R.C. LAHOTI, J. This is an appeal under Section 116 A of the
       Representation of the People Act, 1951 (hereinafter, RPA for Short) from an     E
       order of the Guwahati High Court made under Clause (b) of Section 98 of the
       Act declaring the election of the appellant as Member of Legislative Assembly
       to be void.

              Pursuant to a notification dated 22.4.1998 issued by the Election
       Commission of India by-election in Margherita Legislative Assembly              F
       Constituency No.124 was held in the months of May and June, 1998. Nine
       persons, including the appellant and the respondent filed nomination papers.
       One Ananda Ram Arandhara, the working President of the Margherita Block
       Congress Committee, filed a complaint against the candidature of the
 ,.    respondent submitting that the respondent was an employee of Coal India         G
       Ltd. and as such was disqualified from contesting election under Article 191
       of the Constitution of India and Section 10 of the Representation of the
       People Act, 1951 inasmuch as he was holding an office of profit under the
       Government of India and also performing managerial functions in a company
       wherein the Government of India have not less than 25% shares. The complaint
       so filed was supported by the appellant at the scrutiny of the nomination       H



\ I,
    528                       SUPREME COURT REPORTS [2000] SUPP. 5 S.C.R.

A papers held on 18.5 .1998. The Returning Officer upheld the objection recording
    a finding that the respondent was holding an office of profit in a government
    company which office was not included in the exemptions from disqualifications
    under the Assam Legislative Members (Removal and Disqualifications) Act,
     1950. The nomination paper of the respondent was rejected. The constituency
    went to polls on 3.6.1998. The appellant was declared elected on 6.6.1998. The
B   respondent filed an election petition under Sections 80/81 of the Act laying
    challenge to the appellant's election. On trial the High Court has found that
    the appellant was neither holding an office of profit under the Government
    of India within the meaning of Article 191(l)(a) of the Constitution nor was
    a managing agent, manager or secretary of any company or corporation in the
C   capital of which the Government of India has not less than 25% shares. The
    High Court has further held that the nomination paper of the respondent
    could not have been rejected on the ground of disqualification and as the
    same was improperly rejected, the election of the appellant was void.

          The questions arising for decision in this appeal are:
D
            (i)    whether the respondent was holding an office of profit under the
                   Government of India on the date of his nomination? and,

            (ii)   whether the respondent was disqualified being a manager of any
                   company in the capital of which the Government of India has not
E                  less than 25% shares?

           The basic facts are not in controversy. It is not disputed that the
    respondent was an employee of Tirap Colliery, North Eastern Coal Fields
    under the Coal India Ltd. holding the post of Clerk Grade-I. The gross salary
    attached with the office was around Rs. 6,000 per month. The Coal India Ltd.
F   is a Government company within the meaning of Section 617 of the Indian
    Companies Act, 1956 having come into existence consequent upon the
    nationalisation of the coal mines under the Coal Mines (Nationalisation) Act,
     1973. Under Section 3 of the said Act the right, title and interest of the owners
    in relation to the coal mines came to vest absolutely in the Central Government
G   initially and then came to vest in the Government company under Section 5
    of the said Act. Memorandum of Association and Articles of Association of
    Coal India Ltd. framed in the year 1973 have been brought on record. These
    documents, read in the light of the oral evidence adduced, go to show that
    the Coal India Ltd. is a Private Limit::d Company incorporated under the
    Companies Act, 1956 with I 00% share capital owned by the Central
H   Government. The Company has not more than 15 members. The business of




                                                                                         r
                                                                                         (
           PRADYUT BORDOLOI v. SWAPAN ROY [LAllOTI. J.I                      529

the Company is entrusted to a Board of Directors consisting of not less than         A
3 and not more than 15 directors. The Chairman of the Board is to be
appointed by the President of India and other members of the Board including
the Vice-Chairman shall be appointed by the President in consultation with
the Chairman. The President may also from time to time appoint Functional
 Directors who shall be whole-time employees of the Company. Chairman, Vice-         B
Chairman or any whole- time or part-time Director is liable to be removed from
office. subject to certain conditions, by the President. Certain important matters
 including winding up of the Company must be reserved for the decision of
the President. The President is empowered to issue directions and instructions,
as may be considered necessary, in regard to conduct of business and affairs
of the Company. However, power to create posts in the scales of pay not              C
equiv~lent to or higher than the post at the Board level or to appoint, remove
or suspend managers including the General Managers, Secretaries, officers,
clerks, agents and all other categories of employees are the powers vested
in the Board of Directors. It is clear that so far as the conduct of the business
of the Company and management of day-to-day affairs is concerned, it is the
Board of Directors of Coal India Ltd. in whom vests the power. The President         D
of India does not have power or control in the matter of creation of posts
below the Board level and in the matters relating to appointment, removal and
disciplinary control over the incumbents holding the posts below the Board
level. The salaries, emoluments and perks of such employees are payable from
the funds of the Company. The Central Government does not remunerate or              E
augment the funds for such payments. These findings of fact have not been
disputed by the learned senior counsel for the appellant.

      The first issue arising for decision is whether the respondent was
holding any office of profit under the Government of India within the meaning
of Article 19\(l)(a) of the Constitution which provides that a person shall be F
disqualified for being chosen as, and for being, a member of the Legislative
Assembly or Legislative Council of a State if he holds any office of profit
under the Government of India or £he Government of any State specified in
the First Schedule, other than an office declared by the Legislature of the
State by law not to disqualify its holder. The other parts of this Article are G
not relevant for our purpose and hence are not being referred to.

      The phrase 'office of profit' is not defined in the Constitution. By a
series of decisions (see Maulana Abdul Shakur v. Rikhab Chand & Anr,
(1958] SCR 387; M. Ramappa v. Sangappa & Ors., [1959] SCR 1167; Guru
Govinda Basu v. Sankari Prasad Ghoshal & Ors., [1964) 4 SCR 311 and H
    530                      SUPREME COURT REPORTS [2000] SUPP. 5 S.C.R.

A Shivamurthy Swami Inamdar & Anr. v. Agadi Sanganna Andanappa & Anr.,
    (1971) 3 sec 870, this court has laid down the tests for finding out whether
    the office in question is an office of profit under a Government. These tests
    are (I) Whether the Government makes the appointment; (2) Whether the
    Government has the right to remove or dismiss the holder; (3) Whether the
B   Government pays the remuneration; (4) What are the functions of the holder?
    Does he perform them for the Government; and (5) Does the Government
    exercise any control over the performance of those functions?
                                                                                    ..
          In Guru Gobinda Basu v. Sankari Prasad Ghosal & Ors., [1964] 4 SCR
  :, 11, the Constitution Bench emphasised the distinction between the holder
C of an office of profit under the Government and the holder of a post or service
  under the Government and held that for holding an office of profit under the
  Government, one need not be in the service of Government and there need
  be no relationship of master and servant between them. Several factors entering
  into the determination of question are : (i) the appointing authority (ii) the
  authority vested with power to terminate the appointment, (iii) the authority
D which determines the remuneration, (iv) the source from which the remuneration
  is paid, and (v) the authority vested with power to control the manner in
  which the duties of the office are discharged and to give directions in that
  behalf. But all these factors need not co-exist. Mere absence of one of the
  factors may not negate the over-all test. The decisive test for determining
E whether a person holds any office of profit under the Government, the
  Constitution Bench holds, is the test of appointment; stress on other tests
  will depend on facts of each case. The source from which the remuneration
  is paid is not by itself decisive or material.

         The available case law was reviewed by this Court in Madhuker G.E.
F   Pankakar v. Jaswant Chobbildas Rajani & Ors., (1976] 3 SCR 832. The Court
  described certain aspects as elementary : (i) for holding an office of profit
  under Government one need not be in the service of Government and there
  need be no relationship of master and servant, (ii) we have to look at the
  substance and not the form; and (iii) all the several factors stressed by this
G Court (in Guru Gobinda 's case) as determinative of the holding of an ·office'
  under Government, need not be conjointly present. The critical circumstances,
  not the total factors, prove decisive. A practical view, not pedantic basket of
  tests, s' Juld act as guide.

          In Satrucharla Chandrasekhar Raju v. Vyricherla Pradeep Kumar Dev
H   & Anr., [I 992] 4 sec 404, this Court has articulated the object underlying
           PRADYUT HORDOLOI v. SWAPAN ROY (LAHOTL J.I                     531

Articles 102 (l)(a) and 191 (l)(a) of the Constitution in the following words:   A
         '' ...... in order to eliminate or reduce the risk of conflict between the
         duty and interest amongst the members of the Legislature and to
         ensure that the Legislature does not contain persons who have received
         benefits from the Executive and who consequently being under an
        obligation might be amenable to its influence. Thus the object is to B
        see that such an elected member can carry on freely and fearlessly his
        duties without being subjected to any kind of governmental pressure.
        thereby implying that if such an elected person is holding an office
        which brings him remunerations and ifthe Government has a voice in
        his functions in that office, there is every likelihood of such person C
        succumbing to the wishes of the Government. Therefore this object
        must be borne in mind in interpreting these Articles. Under these
        provisions the right to contest is being taken away on the ground of
        the said disqualification. Such a ban on candidature must have a
        substantial and reasonable nexus to the object that is to be achieved
        namely the elimination of possibility of misuse of the position. It is D
        from this point of view that the right to appoint and right to remove
        the holder of the office in many cases becomes an important and
        decisive test."

       A variety of situations have come up for the consideration of this Court
 wherein the Court was called upon to apply the dekrminative tests so as to
 find out whether a case of holding an office of profit under the Government
 was made out or not. It will be advantageous to have a brief resume of such
 cases. In D.R. Clurushanthappa v. Abdul Khuddw; Anwar & Ors., ; t 969] 3
 SCR 425, a Government undertaking was taken over by a Company incorporated
 under the Indian Companies Act, 1956 as a going concern and the employees F
working in the undertaking were also taken over. As a result of the transfer
of the undertaking, the employees of the Government became the employees
of the Company and were covered by the definition of 'workman· under the
Industrial Disputes Act, 194 7. It was held that such a workman ceases to be
Government servant and is not disqualified to be a candidate for election to
State Legislative Assembly under Article 191 (I )(a) of the Constitution. The CJ'
Court refused to accept the proposition that the mere fact that the Government
had control over the Managing Director or other Directors as well as the
power of issuing directions relating to the working of the company can lead
to the inference that every employee of the company is under the control of
the Government.
                                                                                 H
    532                      SUPREME COURT REPORTS [2000] SUPP. 5 S.C.R.

A          In Ashok Kumar Bhattacharya v. Ajay Biswas & Ors., [1985] 2 SCR 50
    a 3-judge Bench of this Court has held that whether a person holds an office
    of profit under the Government must be measured are judged in each case in
    the light of the relevant provisions of the Act. The measure and nature of
    control exercised by the Government over the employee must be judged in
B   the light of facts and circumstances of each case so as to avoid any possible
    conflict between his personal interests and duties and of the Government. An
    Account-in-charge of Municipality was held not to be holder of office under
    the Government merely because his appointment was subject to confirmation
    by Government and he could be removed subject to sanction by Government.

C       In Satrucharla Chandrasekhar Raju v. Vyricherla Pradeep Kumar Dev
  & Anr., [1992] 4 SCC 404, the appellant was appointed as a single teacher in
  a primary school run by an Integrated Tribal Development Agency (ITDA)
  which is a registered society by its Project Officer. The Project Officer of the
  ITDA is also the District Collector and alone appoints teachers and has also
  power to remove the same. This Court held that the ITDA being a registered
D society, having its own Constitution, the Project Officer though a District
  Collector, acted as a different entity and while exercising the power to appoint
  or to remove teachers, he was acting as the Project Officer. The power was
  not being exerci~ed by the Government. "The Government may have control
  over the appointing authority but has no direct control over the teachers."
E The question of any conflict between his duties and interest as an elected
  member did not arise. It could not be said that the appellant as a teacher can
  be subjected to any kind of pressure by the Government which had neither
  power to appoint him nor to remove him from service. The appellant could
  not be held to b1: holding an office of profit under the Government within the
  meaning of Article 191 (I )(a) of the Constitution.
F          Aklu Ram Mahto v. Rajendra Mahto, [1999] 3 SCC 541, is a case very
    near to the case in hand. A Khalashi and a Meter Reader of Bokaro Steel Plant
    contested elections for Members of Bihar Legislative Assembly. This Court
    held -

            "The Bokaro Steel Plant is under the management and control of Steel
G
            Authority of India Ltd. This is a company incorporated under the
            Companies Act. Its shares are ownect by the Central Government. The
            Chairman and the Board of Directors are appointed by the President
            of India. However, the appointment and removal of workers in the
            Bokaro Steel Plant is under the control of Steel Authority of India Ltd.
H           Their remuneration is also determined by Steel Authority of India Ltd.
               PRADY\! I BORDOLOI v. SW Al' AN ROY [LAHOTI. J.)                   533
            The functions discharged by Steel Authority of India Ltd. or by the          A
            Bokaro Steel Plant cannot be considered as essential functions of the
            Government. In this context a worker holding the post of a Kha!ashi
            or a Meter Reader is not subject to the control of the Central Government
            nor is the power of his appointment or removal exercised by the
            Central Government. Control over his work is exercised not by the            B
            Government, but by the Steel Authority of India Ltd.".

    The Court held that the two could not be considered as holding an office of
    profit under the Central Government. The Court also tested the case on the
    touchstone of Section I 0 of the RPA and held that the posts of Khalashi and
    Meter Reader are non-executive posts. Neither of them is either Secretary or         C
    Manager or a managing agent. None of them attracted disqualification even
    under Section I 0 of the RPA.



-          Posed with the perplexed problem - whether a person holds an office
    under the Government, the first and foremost question to be asked is :
    whether the Government has power to appoint and remove the person on and             D
    from the office? If the answer is in the negative, no further enquiry is called
    for, the basic determinative test having failed. If the answer be a positive one,
     further probe has to go on finding answers to questions framed in
    Shivamurthy 's case (supra) and searching for how many of the factors pointed
    out in Guru Gobinda Basu 's case (supra) do exist? The totality of the facts         E
    and circumstances reviewed in the light of the provisions of relevant Act, if
    any, would lead to an inference being drawn if the office held is under the
    Government. The inquisitive over-view-eye would finally query: on account
    of holding of such office would the Government be in a position to so
    influence him as to interfere with his independence in functioning as a
    member of Legislative Assembly and/or would his holding of the two offices-          F
    one under the Government and the other being a member of Legislative
    Assembly, involve a conflict of interests inter se? This is how the issue has
    to be approached and resolved.

          That being the position of law, no fault can be found with the finding         G
    arrived at by the High Court that the respondent was not holding an office
    of profit under the Government of India and therefore no disqualification
    attached to him under Article 19 I (I )(a) of the Constitution. The Government
    of India do not exercise any control on appointment, removal, service
    conditions and functioning of the respondent. The respondent does hold an
    'office' and there is 'profit' attaching with the office but such office of profit   H
    534                      SUPREME COURT REPORTS [2000] SUPP. 5 S.C.R.

A is not ·under the Government of India'. His being a clerk in Coal India Ltd.
    does not and cannot bring any influence or pressure on him in his independent
    functioning as member of Legislative Assembly. The finding that the
    respondent was neither a managing agent nor a manager nor a secretary
    under Coal India Ltd. though the Company has I 00% share holding of the
    Government, was not seriously disputed by the learned senior counsel for the
B   appellant and in all fairness. rather, he did not pursue this submission. Even
    otherwise, we tind that the respondent was merely a Clerk Grade-I. Occasionally
    in the absence of his senior officer on account of leave or absence, he
    exercised some supervisory function over his subordinates but this would not
                                                                                       --
    make him a manager of the Company. We agree with the High Court that the
C   respondent did not incur a disqualification under Section 10 of the RPA also.
    As the respondent's nomination was improperly rejected, the appellant's
    election was liable to be declared void without proof of the result of the
    dcction, in so far as it concerns the returned candidate, having been materially


D
    affected.

          The appeal is devoid of any merit and is liable to be dismissed. It is
    dismissed accordingly. The order of the High Court is affirmed. The interim
                                                                                       -
    order dated 25.2.2000 passed by this Court stands vacated. ~o order as to
    the costs.

    K.K.T.                                                      Appeal dismissed.