S C SHARMA Vs. UNION OF INDIA

JUDGEMENT

(1.) By this judgment, I propose to dispose of the batch of 6 writ petitions. The petitioners in all these writ petitions were the employees of Modi Rubber Limited which has been arrayed as one of the respondents. Their services having been terminated by Modi Rubber Limited, present writ petitions are filed. Apart from Modi Rubber Limited and its officers, Managing Director etc., UOI, Company Law Board and certain financial institutions are arrayed as respondents. The grievance of the petitioners in all these cases is that their termination from service summarily is in violation of principle of natural justice as well as Articles 14, 19(1)(g) and 21 of the Constitution of India. However, before the validity of the termination order is tested, petitioners have to cross one hurdle. The respondents have taken the objection that these writ petitions filed by the petitioners are not maintainable on the ground that no writ lies against Modi Rubber Limited which is not a "State" or an "Instrumentality" or an "Agency" of the Government within the meaning of Article 12 of the Constitution of India. The arguments were accordingly heard on this aspect. This issue to be decided is common to all these writ petitions and based on same set of facts. For sake of convenience, let us take notice of the facts as stated in CWP No. 3654 of 1996 entitled S.C.Sharma Vs. UOI & Ors.

(2.) Petitioner, S.C. Sharma was taken in the employment of Modi Industries Limited on 10.6.1972. His case is that he has been discharging his duties efficiently, diligently and honestly and in this way he worked for 24 years during which period he was granted promotions and sanctioned increments and special increments. However from 23.8.1996 company abruptly and without any cause or reason removed the daily attendance punch card of the petitioner. On 26.8.1996, petitioner made representation to Chief General Manager of respondent No. 9 requesting him to place his daily attendance punch card in its place to enable him to record his attendance. However instead of doing so, his services were terminated by order dated 26.8.1996 without giving any opportunity of hearing or assigning any reasons and petitioner has challenged this termination being malafide, arbitrary and also in gross contravention of the law laid down by Supreme Court in various cases including in the case of DTC v. DTC Mazdoor Congress & Ors., AIR 1991 SC 101. It may be mentioned that termination order dated 26.8.1996 states that services are terminated in terms of clause IV of appointment letter dated 12.9.1972 offering one month salary in lieu of notice. In the counter affidavit filed by respondents 8 to 10 & 12 i.e. Modi Rubber Limited and its officers, maintainability of the writ petition is challenged on various grounds. It is stated that respondent No.8 is neither a public body nor discharging statutory functions. There is no violation of any legal or other right of the petitioner. Petitioner is seeking to enforce his contract of personal services which is not permissible. Respondent No.8 is a public limited company and not a "State" or "Instrumentality" or an "Agency" of the State, and therefore, not amenable to the writ jurisdiction under Article 226 of the Constitution of India. It is stated that respondents 1 to 7 do not have any control in the management of affairs of the respondent No.8 company. On merits, it is stated that-the services of the petitioner have been terminated contractually and in terms of contract of service by giving one month salary in lieu of notice period which according to respondent No.8 was permissible in law. It is denied that the termination was arbitrary or malafide. It is further stated that the petitioner cannot invoke the provisions of Part III & IV of the Constitution including Articles 14,19(1) (g) and 21 of the Constitution as respondent No.8 is not a State, and therefore, not subject to Constitutional limitation in relation to fundamental rights guaranteed by part III and preamble and directive principles of (g) and 21 of the Constitution State policies contained in part IV of the Constitution. It is further stated that appropriate remedy for the petitioner is to file civil suit claiming damages that too if the termination is ultimately held to be illegal by the Civil Court. In the rejoinder filed by the petitioner, averments made in the counter affidavit of respondents 8 to 10 & 12 are disputed and it is stated that writ petition is maintainable. It is further stated that the financial institutions have control in the affairs of the company and these financial institutions namely respondents 3 to 7 hold jointly more than 51 per cent paid up share capital and have joint majority of their nominees Directors on the Board of Directors of respondent No.8. It is further stated that clause IV of the letter of appointment is against public policy, and therefore, void and services of the petitioner could not be terminated by relying on such a clause.

(3.) It was further submitted that even if it is presumed that respondent No.8 was not the "State", still it was subject to fundamental constitutional limitations. The submission was that respondent No.8 by virtue of carrying on the manufacturing and selling in the domestic and foreign markets the automobile tyres and tubes in a Scheduled industry under item 30(1) of the First Schedule to Industries (Development and Regulation) Act, 1951 and thus being engaged in matters of high public interest is the Government agency and doing business for the benefit of the public. The functions of respondent No.8 are of great public importance, interest, concern and welfare, and are activities of the nature carried on by a modern State and particularly a modern welfare State, for the promotion of Social and Economic welfare of the people as enunciated in Directive Principles of State Policy contained in part IV of the Constitution Today State cannot be conceived of simply as a machinery wielding the thunderbolt of authority; It has to be viewed mainly as "a service corporation. Reliance was placed on: