LexBALMER LAWRIE & CO. LTD. & ORS. versus PARTHA SARATHI SEN ROY & ORS.
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A B [2013] 4 S.C.R. 1018 BALMER LAWRIE & CO. LTD. & ORS. v. PARTHA SARATHI SEN ROY & ORS. (Civil Appeal Nos. 419-426 of 2004 etc.) FEBRUARY 20, 2013 [DR. B.S. CHAUHAN AND V. GOPALA GOWDA, JJ.] Constitution of India, 1950 -Art. 12 - Instrumentality and agency of Government - Determination - Criteria - Discussed C and held: The Company in question is an authority u/Art. 12. Contract - Contract of employment - Amenability to judicial review - Held: Unfair, untenable, irrational or unjust clause in a contract hit by s.23 of Contract Act and against 0 public policy, is amenable to judicial review - In the present case employment contract providing termination of service of employee at the sole discretion of the employer is not justifiable - Hence the contract held void to that extent - Contract Act - s. 23 - Judicial Review. E Service Law - Termination of Service - By the State or State instrumentality - As per clause in appointment letter providing sole discretion to the employer to terminate the services of employees - Held: State itself or a State instrumentality cannot impose unconstitutional conditions in F statutory rules/regulations vis-a-vis its employees, in order to terminate the services of its permanent employees in accordance with such terms and conditions - The alleged clause of the appointment letter is unconscionable and thus Service Condition Rules held violative of Art. 14 of the G Constitution to this extent. Words and Phrases: 'Control' and 'Pervasive control' - Meaning of. H 1018 BALMER LAWRIE & CO. LTD. & ORS. v. PARTHA 1019 SARATHI SEN ROY & ORS. The appellant-Company was a Government company A and subsidiary of a Government Company. Responden~ employees joined the services of the Company at different times. Services of the respondent-employees were terminated in view of a clause in the letter of appointment which provided that the company would have a right which would be exercised at its so.le discretion to terminate the services of such employees without assigning any reason. B In a writ petition challenging the same the appellant- Company contested the writs contending that it was not C an authority within the meaning of Article 12 of the Constitution and therefore was not amenable to writ jurisdiction. The Single Judge of the High Court held that the Company was not a State within meaning of Art. 12, however, in another case the learned Single Judge held 0 that the Company was a State within meaning of Article 12. In writ appeals, held that the Company was a 'State' within meaning of Article 12 of the Constitution. Hence the present appeals. Disposing of the appeals, the Court HELD: 1.1. It is difficult to provide an exhaustive definition of the term "authorities", which would fall within E the ambit of Article 12 of the Constitution. This is precisely why, only an inclusive definition is possible. It is in order F to keep pace with the broad approach adopted with respect to the doctrine of equality enshrined in Articles 14 and 16 of the Constitution. There has been a corresponding expansion of the judicial definition of the term State, as mentioned in Article 12 of the Constitution. In light of the changing socio-economic policies of the G country, and the variety of methods by which government functions are usually performed, the court must examine, whether an inference can be drawn to the effect that such an authority is intact an instrumentality of the State under Article 12 of the Constitution. It may not be easy for the H 1020 SUPREME COURT REPORTS [2013) 4 S.C.R. A court, in such a case, to determine which duties form a part of private action, and which form a part of State action, for the reason that the conduct of the private authority, may have become so entwined with governmental policies, or so impregnated with governmental character, 8 so as to become subject to the constitutional limitations that are placed upon State action. Therefore, the court must determine whether the aggregate of all relevant factors once considered, would compel a conclusion as regards the body being bestowed with State C responsibilities. [Para 12] [1038-C-G] 1.2. In order to determine whether an authority is amenable to writ jurisdiction except in the case of habeas corpus or quo warranto, it must be examined, whether the company/corporation is an instrumentality or an agency D of the State, and if the same ca
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