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Supreme Court of India

STATE OF ASSAMversusBARAK UPATYAKA D.U. KARMACHARI SANSTHA

Citation
2009 INSC 357
Decided
17 March 2009
Disposal
Appeal(s) allowed

Holding

A cooperative society, even if classified as a 'state' under Article 12, remains an independent juristic entity and the state government is not liable to pay its employees' salaries merely because it provides grant‑in‑aid.

Summary

The State of Assam appealed against a Guwahati High Court order that directed the state to release grant‑in‑aid to the Cachar and Karimganj District Milk Producers' Co‑operative Union Ltd (CAMUL) so that the society could pay salaries to its employees. CAMUL, a cooperative registered under the Assam Cooperative Societies Act, 1949, was argued by the trade union representing its workers to be effectively a state entity because of pervasive government control, and therefore the government should be liable for the employees' wages. The Supreme Court held that even if CAMUL qualified as a "state" under Article 12, it remained an independent juristic entity and could not be identified with the state government; consequently, the government was not obligated to fund the society's salary obligations. The Court further clarified that interim orders, such as those in Kapila Hingorani cases, do not constitute binding precedents and that the state’s liability arises only under specific statutory or contractual obligations, not merely from grant‑in‑aid. Accordingly, the appeal was allowed, the High Court orders were set aside, and the writ petition was dismissed, leaving the employees to seek remedies against CAMUL under appropriate labour or cooperative legislation.

Issues considered

  • The extent to which a cooperative society, even if deemed a 'state' under Article 12, can be treated as the state government for the purpose of liability to pay employee salaries.
  • Whether a grant‑in‑aid provided by the state government creates a legal obligation for the state to continue funding the cooperative's salary obligations.
  • The precedential value of interim orders, particularly those issued in Kapila Hingorani cases, in establishing state liability for employee wages.

Subjects

Cooperative societiesState liabilityArticle 12Article 226Grant-in-aidInterim order precedentHuman rightsWage paymentCorporate veil

Judgment

                          [2009] 4 S.C.R. 467


                      STATE OF ASSAM                                    A
                              V.
        BARAK UPATYAKA D.U. KARMACHARI SANSTHA
                Civil Appeal No. 6492 of 2002
                          MARCH 17, 2009
                                                                        B
     [R.V. RAVEENDRAN AND MARKANDEY KAT JU, JJ.]
           Constitution of India, 1950 - Article 226 - Writ petition -
    Directions issued to State Government to release grants to
    Co-operative Society to enable it to pay salaries to employees
    of Society - Justification of - Held: Co~operative society even c
    if 'State' under Article 12, was independent juristic entity and
    could not have been identified with or treated as State
    Government - State government released grant-in-aid to
~
    Society continuously for some years to meet its development
    activities or salaries - It does not mean that State Government D
    is to bear and pay salaries of employees for all times to come
    - Employees have no right to get their salaries from State
    Government - Appropriate remedy is under the iabour
    legislation or Co-operative Societies Act - Assam Co-
    operative Societies Act, 1949 - s. 43.                             E
          Interim order - Precedential value of - Held: Precedent
    is a judicial decision containing a principle, which forms an
    authoritative element termed as ratio decidendi - Interim order
    which does not finally and conclusively decide an issue cannot
                                                                        F
    be a precedent - Any reasons assigned in support of such
    non-final interim order containing prima facie findings, are only
    tentative and have no value as precedents - Precedent.
         The question which arose for consideration in this
    appeal was whether the High Court was justified in G
    directing the State Government to sanction financial
    assistance by way of grant-in-aid to Cachar and Karimganj
    District Milk Producers' Co-operative Union Limited-Co-

                                  467                                   H
    468       SUPREME COURT REPORTS              [2009] 4 S.C.R.


A operative society so as to enable it to pay the salary and
  other emoluments of its employees.
          Allowing the appeal, the Court
          HELD: 1.1 Cachar and Karimganj District Milk
s Producers' Co-operativt; Jnion Limited (CAMUL) is a co-
  operative society registered under those provisions of the
  Assam Cooperative Societies Act, 1949. Section 85 of the
  saij Act provides that every registered society ~hall be
  deemed to be a body corporat~ by the r;:ime under which
c it is registered, with peroetual succession and a common
  seal, and with power to hold property, to enter into
  contracts, institute and defend suits and other le.gal
  proceedings and to do all things necessary for the
  purposes for which it was constituted. Therefore, CAMUL,
  even if it was 'state' for purposes of Article 12 of the
0
  Constitution of India, 1950, was an independent juristic
  entity and could not have been identified with or treated
  as the state government. [Para 5] [474-D-E]
         1.2 Section 43 of the Act provides that notwith-
E   standing anything contained in any law for the time being
    in force, the State Government may grant loans or give
    financial assistance in any form to any registered society.
    Therefore, the fact that the state government had given
    financial assistance in the form of grant-in-aid to CAMUL
F   continuously for some years, either to meet its
    development activities or for even meeting the salaries,
    does not mean that state government is responsible to
    bear and pay the salaries and emoluments of the
    employees of CAMUL or other liabilities of CAMUL. Nor
G   can the state government be made liable for extension of
    financial assistance for all times to come, to cover the
    payment of salaries of employees of CAMUL. If the
    salaries are not paid, the remedy of the employees of
    CAMUL is to proceed against CAMUL, in accordance with
H   law, by approaching the forum under the appropriate
        STATE OF ASSAM V. BARAK UPATYAKA D.U.           469
                 KARMACHARISANSTHA

labour legislation or the Co-operative Societies Act. But a A
trade union representing the employees of a co-operative
society cannot, by filing a writ petition, require the
Government to bear and pay the salaries of the employees
of the co-operative society, howsoever pervasive, the
control of the state government, over such society. Nor is B
any right created to demand the continuance of financial
assistance to a co-operative society, on the ground that
such assistance has been extended by the government,
for several years. The respondent has not been able to
show any right in the employees of CAMUL against the C
state government, or any obligation on the part of the state
government with reference to the salaries/emoluments of
employees of CAMUL either under any statute or contract
or otherwise. [Para 6] [474-G-H; 475-A-B-C-D]
     1.3 A precedent is a judicial decision containing a D
principle, which forms an authoritative element termed as
ratio decidendi. An interim order which does not finally
and conclusively decide an issue cannot be a precedent.
Any reasons assigned in support of such non-final interim
order containing prima facie findings, are only tentative. E
Any interim directions issued on the basis of such prima
facie findings are temporary arrangements to preserve the
status quo till the matter is finally decided, to ensure that
the matter does not become either infructuous or a fait
accompli before the final hearing. [Para 10] [479-E-F]        F
     1.4 The observations and directions in Kapil
Hingorani (I) & (II) being interim directions based on
tentative reasons, restricted to the peculiar facts of that
case involving an extraordinary situation of human rights
violation resulting in starvation deaths and suicides by G
reason of non-payment of salaries to the employees of a
large number of public sector undertakings for several
years, have no value as precedents. It is clear that
directions were not based on legal right of the employees,
but were made to meet a human right problem involving H
    470      SUPREME COURT REPORTS                [2009] 4 S.C.R.


A   starvation deaths and suicides. The interim directions
    were also clearly in exercise of extra-ordinary power
    under Article 142 of the Constitution. It is not possible to
    read such tentative reasons, as final conclusions. If those
    observations are taken to be a final decision, it may lead
B   to every disadvantaged group or every citizen or every
    unemployed person, facing extreme hardship,
    approaching this Court or the High Court alleging human
    right violations and seeking a mandamus requiring the
    state, to provide him or them an allowance for meeting
c   food, shelter, clothing, salary, medical treatment, and
    education, if not more. That was not the intention of Kapila
    Hingorani (I) & (II). The interpretation on the tentative
    observations in Kapila Hingorani(I) & (II), that the
    government would be liable for payment of salaries and
    other dues of employees of the public sector undertakings
0
    is rejected. [Paras 10 and 12) [479-G-H; 480-A-B-C; 480-
    H; 481-A]
        Steel Authority of India v. National Union Waterfront
    Workers 2001 (7) SCC 1 - followed
E       Kapila Hingorani v. State of Bihar 2003 (6) SCC 1; Kapila
    Hingorani v. State of Bihar 2005 (2) SCC 262 - referred to.
         1.4 The orders of the Division Bench and the Single
    Judge of the High Court are set aside and the writ petition
F   is dismissed without prejudice to the right of the
    employees of CAMUL to take such action as is available
    in law for redressal of their grievances. [Para 13) [481-B]
                       Case Law Reference

G
          2003 (6) sec 1          Referred to.      Para 7
          2oos (2) sec 262        Referred to.      Para 8
          2001 (7) sec 1         followed.          Para 11
         CIVILAPPELLATE JURISDICTION: Civil Appeal No. 6492
H   of 2002
                  STATE OF ASSAM V. BARAK UPATYAKA D.U.                471
                           KARMACHARISANSTHA

               From the Judgement and Order dated 14:06.2001 of the A
          Hon'ble High Court of Guwahati in W.A. no. 47 of 2001.

               Avijit Roy, Ranjan Mazumdar, for the Appellant.

                Manoj Goel, Shovodeep Roy, Wajeeh Sahfiq, Brij Bhushan,
          for the Respondent.                                           B
               The Judgement of the Court was delivered by

               R. V. RAVEENDRAN J.
                1. This appeal by special leave is filed by the State of
          Assam aggrieved by the order dated 14.6.2001 passed by the          c
          Division Bench of the Gauhati High Court. By that order the
          Division Bench upheld the order dated 23.12.1999 of the learned
          Single Judge in Civil Rule No.2996/1995 allowing respondent's
          writ petition and directing the state government to sanction
...
          financial assistance by way of grant-in-aid to Cachar and D
          Karimganj District Milk Producers' Cooperative Union Limited
          ('CAMUL' for short) so as to enable CAMUL to make regular
          payment of monthly salaries, allowances as also the arrears to
          its employees.
                2. CAMUL is a society registered under the Assar.~ Co-        E
          operative Societies Act, 1949 ('Act' for short). Respondent, a
      "   Trade Union representing the workers of CAMUL, filed the said
          writ petition (Civil Rule No.2996/1995) contending that the state
          government formed and registered CAMUL as a co-operative
          society to run its cattle development project; that its Board of    F
          Directors including the Managing Director (always a government
          servant, on deputation) were appointed by the state government;
          that the post of the Managing Director of CAMUL was declared
          to be a post equivalent to a Head of Department under the state
          government; that initially the entire staff of CAMUL were drawn     G
          on deputation from the Veterinary, Agriculture & Co-operative
          Departments of the state government; that in a phased manner,
          those employees were reverted back to their Parent
          Departments and replaced by the staff appointed by CAMUL,
          through a Selection Board set up by the state government with       H
     472       SUPREME COURT REPORTS                   [2009] 4 S.C.R.


·A   representatives from the Central Government and National Dairy
     Development Board; that state government sanctioned the
     staffing pattern of CAM UL; that from the year 1982-83 onwards
     the Government was extending financial assistance by way of
     grants to CAMUL to meet the expenditure (including the
B    expenditure relating to its employees); and that for the years
     1994-95 though the state government had sanctioned financial
     assistance in a sum of Rs. 7 lakhs as grant-in-aid, it was not
     disbursed and consequently CAMUL did not pay the monthly
     salaries to its employees from December 1994 onwards. It is
c    contended that state government had all pervasive control over
     the affairs and management of CAM UL and therefore it should
     be treated as a department of government of Assam, though
     registered as a co-operative society by lifting the corporate veil.
     It was further contended that state government was responsible
 D   and liable to pay the salaries and emoluments of the employees
     of CAM UL and it was not justified in withholding the grant amount.
     The respondent union therefore sought a direction to the state
     government to release the arrears of pay and allowances of
     employees of CAMUL with effect from December 1994 and for
     a direction to continue to pay the salary and allowances to the
 E   employees of CAM UL, every month in future. In addition to the
     state government (respondent No.1) and its officers
      (respondents 2 to 4), the Union of India (respondent No.5) and
      CAMUL and its Managing Director (respondents 6 and 7) were
      impleaded as parties to the writ petition.
 F
           3. The state government opposed the petition. It inter alia
     contended that the grant-in-aid was extended for helping CAMUL
     in its different development activities; that under a centrally
     sponsored scheme, between 1981 to 1986, the earmarked
 G   amount was released on 50:50 basis by central and state
     government with 70% loan component and 30% as grant
     component; that though the loan component was not repaid by
     CAMUL, the state government continued the grant-in-aid for
     purposes of development activities; that the state government
     had also provided Rs.43.60 lakhs for developing the milk-
 H
               STATE OF ASSAM V. BARAK UPATYAKA D.U.                 473
              KARMACHARI SANSTHA [R. V. RAVEENDRAN J.]

        processing infrastructure of CAMUL; that despite such A
        assistance, CAMUL became defunct and stopped all its
        activities and thereafter the Silchar Town Milk Supply Project
        was being run by the state's dairy development department itself;
        that at no time, the state government made any commitment or
        agreed to bear the salaries of employees of CAMUL or any B
        other similar societies; that CAMUL had to generate its own
        funds and resources to pay the salaries of its staff; and that as
        there was no relationship of employer and employee between
        the state government and the employees of CAM UL, it was not
        responsible to bear or pay any amount towards the salaries of C
        the employees of CAMUL.
              4. The learned Single Judge allowed the writ petition. He
        held that the State Government through its Veterinary Department
        undertook the Integrated Cattle Development Projects (!CDP)
        in various districts of Assam; and as a part of the said project,   D
        an ICDP block was created at Ghungoor, Silchar in Cachar
        district; that 32 cooperative societies of Milk Producers were
        established and CAM UL was formed as an Apex Body of those
        co-operative societies; that the Dairy Development Department
        of the state government had been providing grant-in-aid             E
        earmarked in the state budget every year to CAM UL; that the
        state government failed to offer any explanation or reason for
        stopping the grant-in-aid from 1994; that the Dairy Development
    •   Project at Silchar was purely a state government scheme and
        as that Project has not been discontinued and as there was no
        decision to barring CAMUL from receiving grant-in-aid which         F
        was being granted from 1982-83 till 1994, the state government
        could not deny the grant-in-aid amount. Consequently, the
        learned Single Judge directed release of the grand-in-aid for
        paying monthly salaries and allowances along with arrears to
        the employees. The said order has been affirmed by the Division     G
•       Bench which is under challenge in this appeal by special leave.
        The only question that arises for consideration is whether the
        High Court was justified in directing the state government to
        release grants to CAMUL, so as to enable CAMUL to pay the
        salary and other emoluments of its employees.                       H
    474        SUPREME COURT REPORTS                       [2009] 4 S.C.R.


A          5. The various averments of the respondent in the writ
     petition, about the all pervasive financial, administrative and
     functional control of CAMUL by the state government, even if
     assumed to be true, may at best result in CAM UL being treated
     as 'state' within the meaning of that expression under Article 12
B    of the Constitution of India. If it is a 'state', in case of violation of
     any of the fundamental rights of its employees, by CAM UL as
    employer, the employees were entitled to claim relief against
    CAM UL, by taking recourse to a writ petition under Article 226
     of the Constitution of India. But the fact that a corporate body or
c   co-operative society answers the definition of 'state' does not
    make it the 'state government', nor will the employees of such a
    body, become holders of civil posts or employees of the state
    government. Therefore the fact that the CAMUL may answer
    the definition of "state" does not mean that the state government
    is liable to bear and pay the salaries of its employees. CAMUL
0
    indisputably is a co-operative society registered under the                  •
    provisions of the Assam Cooperative Societies Act, 1949.
    Section 85 of the said Act provides that every registered society
    shaJI be deemed to be a body corporate by the name under
    which it is registered, with perpetual succession and a common
E   seal, and with power to hold property, to enter into contracts,
    institute and defend suits and other legal proceedings and to
    do all things necessary for the purposes for which it was
    constituted. Therefore, CAM UL, even if it was 'state' for purposes
    of Article 12, was an independent juristic entity and could not
F   have been identified with or treated as the state government. In
    the view we have taken, it is not necessary in this case to examine
    whether CAMUL was 'state' for purposes of Article 12.
          6. Section 43 of the Act provides that notwithstanding
G   anything contained in any law for the time being in force, the
    State Government may grant loans or give financial assistance
    in any form to any registered society. Therefore, the fact that the
    state government had given financial assistance in the form of
    grant-in-aid to CAMUL continuously for some years, either to
    meet its develop1 nent activities or for even meeting the salaries,
H
       STATE OF ASSAM V. BARAK UPATYAKA D.U.               475
      KARMACHARI SANSTHA [R V. RAVEENDRAN J.]

does not mean that state government is responsible to bear A
and pay the salaries and emoluments of the employees of
CAMUL or other liabilities of CAMUL. Nor can the state
government be made liable for extension of financial assistance
for all times to come, to cover the payment of salaries of
employees of CAM UL. If the salaries are not paid, the remedy B
of the employees of CAM UL is to proceed against CAM UL, in
accordance with law, by approaching the forum under the
appropriate labour legislation or the Co-operative Societies Act.
But a trade union representing the employees of a co-operative
society cannot, by filing a writ petition, require the Governmentc
to bear and pay the salaries of the employees of the co-operative
society, howsoever pervasive, the control of the state
government, over such society. Nor is any right created to
demand the continuance of financial assistance to a co-
operative society, on the ground that such assistance has been
                                                                  0
extended by the government, for several years. The respondent
has not been able to show any right in the employees of CAM UL
against the state government, or any obligation on the part of
the state government with reference to the salaries/emoluments
of employees of CAM UL either under any statute or contract or
~heMise.                                                          E
     7. The learned counsel for the respondent contended that
the same issue arose for consideration in Kapila Hingorani v.
State of Bihar reported in 2003 (6) SCC 1 (for short 'Ka pila
Hingorani /') and the issue has been answered in their favour. F
Reference is invited to the following question, which was set
down as one of the questions arising for consideration in that
case:
     Whether having regard to the admitted position that the
     government companies or corporations referred to G
     hereinbefore are 'State' within the meaning of Article 12 of
     the Constitution of India, the State of Bihar having deep
     and pervasive control over the affairs thereof, can be held
     to be liable to render all assistance to the said companies
     so as to fulfil its own and/or the corporations' obligations H
    476       SUPREME COURT REPORTS                      [2009] 4 S.C.R.


A         to comply with the citizens' rights under Article 21 and 23
          of the Constitution of India?
          Reference is also invited to the following observations of
    this Court in considering the said question :

B         "30. 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
c         shareholder. Although in law, its liability towards the
          creditors 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
D         the citizen to life and liberty, the State has also an additional
          duty to see that the rights of employees of such
          corporations are not infringed.
          31 . The right to exercise deep and pervasive control would
          in its turn make the Government of Bihar liable to see that
                                                                              !
E         the life and liberty clause in respect of the employees is
          fully safeguarded. The Government of the State of Bihar,
          thus, had a constitutional obligation to protect the life and
          liberty of the employees of the government-owned
          companies/corporations who are the citizens of India. It
F         had an additional liability having regard to its right of
          extensive supervision over the affairs of the company.
          33. The State having regard to its right of supervision
          and/or deep and pervasive control, cannot be permitted
          to say that it did not know the actual state of affairs of the
G         State Government undertakings and/or it was kept in the
          dark that the salaries of their employees had not been
          paid for years leading to starvation death and/or
          commission of suicide by a large number of employees.
          Concept of accountability arises out of the power conferred
H         on an authority.
            STATE OF ASSAM V. BARAK UPATYAKA D.U.                477
           KARMACHARI SANSTHA [R. V. RAVEENDRAN J.]

         34. The state may not be liable in relation to the day-to- A
         day functioning of the companies, but its liability would
         arise on its failure to perform the constitutional duties and
         functions by the public sector undertakings, as in relation
         thereto lie the State's constitutional obligations. The State
         acts in a fiduciary capacity. The failure on the part of the B
         state in a case of this nature must also be viewed from the
         angle that the statutory authorities have failed and/or
         neglected to enforce the social-welfare legislations
         enacted in this behalf e.g. Payment of Wages Act,
         Minimum Wages Act etc. Such welfare activities as C
         adumbrated in part IV of the Constitution of India
         indisputably would cast a duty upon the state being a
         welfare state and its statutory authorities to do all things
         which they are statutorily obligated to perform."
         Reference is invited to the fact that this Court directed the D
    Bihar government to release Rs.50 crores and deposit it with
    the High Court for disbursing salaries of employees of
    government corporations/companies. The contention of
    respondent is that the direction of the High Court, is in
    consonance with the said view.                                     E
          8. The learned counsel for the respondent also relied upon
    the following observations in Kapila Hingorani vs. State of Bihar
    - 2005 (2) SCC 262 (for short 'Kapila Hingorani //') :
         "26. We, therefore, do not appreciate the stand taken by F
         the State of Bihar now that it does not have any
         constitutional obligation towards a section of citizens viz.
         the employees of the public sector undertakings who have
         not been paid salaries for years.

L        27. We also do not appreciate the submissions made on G
         behalf of the State of Bihar that the directions issued were
         only one-time direction. In clause 4 of the directions, it
         was clearly stated that the State for the present shall deposit
         a sum of Rs. 50 crores before the High Court for
         disbursement of salarfes to the employees of the H
    478       SUPREME COURT REPORTS                   (2009] 4 S.C.R.


A         corporations. Furthermore, the matter had been directed
          to be placed again after six months."
          This Court also issued further interim directions to State
    of Bihar to deposit a further sum of Rs.50 crores and State of
    Jharkhand to deposit a sum of Rs.25 crores to meet the arrears
8   of salaries of Public Sector undertakings.
          9. We have carefully examined the said two decisions. The
    two decisions are interim orders made in a writ petition under
    Article 32 of the Constitution. The said orders have not finally
c   decided the issues/questions raised, nor laid down by any
    principle of law. The observations extracted above as also other
    observations and directions are purely tentative as will be
    evident from the following observations in Kapila Hingorani (/)

D         "We, however hasten to add that we do not intend to lay
          down a law, as at present advised, that the State id directly
          or vicariously liable to pay salaries/remunerations of the
          employees of the public sector undertakings or the
          government companies in all situations.
E         We, as explained hereinbefore, only say that the state
          cannot escape its liability when a human rights problem of
          such magnitude involving the starvation deaths and/or
          suicide by the employees has taken place by reason of
          non-payment of salary to the employees of public sector
F         undertakings for such a long time.
          This order shall be subject to any order that may be passed
          subsequently or finally."
                                     '
       The position is further made clear in Kapila Hingorani (II)
G as under:
          "We make it clear that we have not issued the
          aforementioned directions to the States of Bihar and
          Jharkahand on the premise that they are bound to pay the
          salaries of the employees of the public sector undertakings
H
                 STATE OF ASSAM V. BARAK UPATYAKA D.U.                 479
                KARMACHARI SANSTHA [R. V. RAVEENDRAN J.]

              but on the ground that the employees have a h-uma.n right A
              as also a fundamental right under Article 21 which th~.
              states are bound to protect. The directions, which have
              been issued by this Court on 9.5.2003 as also which are
              being issued herein, are in furtherance of the human and
              fundamental rights of the employees concerned and not B
              by way of an enforcement of their legal right to arrears of
              salaries. The amount of salary payable to the employees
              or workmen concerned would undoubtedly be adjudicated
              upon in the proper proceedings. However, these directions
              are issued which are necessary for their survival."            c
               It is thus clear that directions were not based on legal right
         of the employees, but were made to meet a human right problem
         involving starvation deaths and suicides. But in the case on
         hand, relief is claimed and granted by proceeding on the basis D
         that the employees of corporations/bodies answering the
         definition of 'state' have a legal right to get their salaries from
         the state government. In fact Kapila Hingorani (/) and (//)
         specifically negative such a right.
               10. A precedent is a judicial decision containing a principle, E
         which forms an authoritative element termed as ratio decidendi.
         An interim order which does not finally and conclusively decide
         an issue cannot be a precedent. Any reasons assigned in
         support of such non-final interim order containing prima facie
                                                                              F
         findings, are only tentative. Any interim directions issued on the
         basis of such prima facie findings are temporary arrangements
         to preserve the status quo till the matter is finally decided, to
         ensure that the matter does not become either infructuous or a
.•   .   fait accompli before the final hearing. The observations and
                                                                              G
         directions in Kapil Hingorani (/)and(//) being interim directions
         based on tentative reasons, restricted to the peculiar facts of
         that case involving an extraordinary situation of human rights
         violation resulting in starvation deaths and suicides by reason
         of non-payment of salaries to the employees of a large number
                                                                              H
    480       SUPREME COURT REPORTS                   [2009] 4 S.C.R.


A of public sector undertakings for several years, have no value
  as precedents. The interim directions were also clearly in
  exercise of extra-ordinary power under Article 142 of the
  Constitution. It is not possible to read such tentative reasons,
  as final conclusions, as contended by the respondent. If those
B observations are taken to be a final decision, it may lead to
  every disadvantaged group or every citizen or every unemployed
  person, facing extreme hardship, approaching this Court or the
  High Court alleging human right violations and seeking a
  mandamus requiring the state, to provide him or them an
C allowance for meeting food, shelter, clothing, salary, medical
  treatment, and education, if not more. Surely that was not the
  intention of Kapila Hingorani (/) and (//).
          11. What clearly holds the field at present is the principle
o laid down and reiterated by the Constitution bench of this Court
    in Steel Authority of India v. National Union Waterfront Workers
    2001 (7) SCC 1 wherein this Court categorically held :
          " We wish to clear the air that the principle, while
          discharging public functions and duties the government
E         companies/corporations/societies which are instrumen-
          talities 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
F         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


G
          or under private law."
                                                (emphasis supplied]       .   .
         12. We, therefore, reject the interpretation put forth by the
    respondent, on the tentative observations in Kapila Hingorani(I)
    and (//), to contend that the government would be liable for
H   payment of salaries and other dues of employees of the public
            STATE OF ASSAM V. BARAK UPATYAKA D.U.               481
           KARMACHARI SANSTHA [R. V. RAVEENDRAN J.]

    sector undertakings. We are of the considered view that the A
    decision of the High Court cannot therefore be sustained.
          13. We, accordingly allow this appeal, set aside the orders
    of the Division Bench and the learned Single Judge of the High
    Court and dismiss the writ petition without prejudice to the right
                                                                       8
    of the employees of CAMUL to take such action as is available
    in law for redressal of their grievances. We may also add that
    this decision will not come in the way of state government
    formulating any scheme or extending any relief or benefit to the
    employees of CAMUL or other similarly situated persons.

    N.J.                                           Appeal allowed.




'


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