"Other Authorities": The Early Cases
Chapter Twenty-Eight
Syllabus topic 2, "State: Need for widening the definition in the wake of Liberalisation".
Pages 130 to 133 of 304
In one line
The courts spent twenty years deciding what "other authorities" limits, and the answer they reached was that it is limited by function and control, not by legal form.
In the wording a student can write in an exam: the expression "other authorities" in article 12 is not defined. Three readings were pressed in the early cases: that ejusdem generis confines it to bodies of the same genus as those named before it; that it covers only bodies exercising sovereign or governmental functions; and that it covers every authority created by statute on which powers are conferred to carry out governmental or quasi-governmental functions. The last prevailed in Rajasthan State Electricity Board v. Mohan Lal, where the Court held that ejusdem generis has no application because the bodies named share no distinct genus. In Sukhdev Singh v. Bhagatram the Court held that the regulations of a statutory corporation have the force of law and that such corporations are authorities within article 12, and the concurring judgment of Mathew J. introduced the reasoning that a body is to be judged by whether it is an instrumentality or agency of the State.
The three readings
The ejusdem generis reading. Where general words follow an enumeration of specific things, the general words take their colour from the specific ones. On this reading "other authorities" would cover only bodies of the same kind as governments, legislatures and local authorities, that is, organs of government proper. This would have made article 12 close to exhaustive and would have left every statutory corporation outside Part III.
The sovereign function reading. A body is an authority only if it exercises functions that belong to the sovereign, such as taxation, policing and adjudication. A body carrying on trade or industry would be outside, however completely the State owned it.
The statutory power reading. A body is an authority if it is created by or under a statute and has been given powers to carry out governmental or quasi-governmental functions, whether or not those functions are commercial.
The early High Court decisions divided among these, and one line went as far as holding that a university was not an authority because it did not exercise sovereign power. That position could not survive.
The case that settled it
Facts. Rajasthan State Electricity Board, Jaipur v. Mohan Lal, AIR 1967 SC 1857, (1967) 3 SCR 377, decided 3 April 1967. Permanent government employees were placed at the disposal of the State Electricity Board, constituted under the Electricity (Supply) Act 1948. The Board never framed its own grades or service conditions. When the first respondent, reverted to the Board, was refused consideration for promotion as Assistant Engineer while others identically placed had been promoted, he moved the High Court under articles 226 and 227 alleging breach of articles 14 and 16. The Board contended that it was not "State" within article 12 and that no direction could therefore issue to it.
"Other Authorities": The Early Cases
Held. By the majority, the Board is an "other authority" and therefore "State", to which directions may be given under articles 226 and 227. The expression is wide enough to include every authority created by a statute on which powers are conferred to carry out governmental or quasi-governmental functions, functioning within the territory of India or under the control of the Government of India. It is not material that some of the powers conferred may be for carrying on commercial activities, because under articles 19(1)(g) and 298 the State itself is empowered to carry on trade or business. And ejusdem generis must not be applied, because for that rule to operate there must be a distinct genus or category running through the bodies previously named, and there is none: the executive governments of the Union and the States, the legislatures of the Union and the States, and local authorities have no common genus.
Why it matters. It rejects two of the three readings in a single judgment. Ejusdem generis goes, and with it the argument that article 12 is confined to organs of government; and the sovereign function test goes, because commercial activity is expressly held immaterial. What is left is the statutory power reading, and every later development builds on it.
The next step: what a statutory corporation's rules are
Facts. Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi, AIR 1975 SC 1331, (1975) 1 SCC 421, decided 21 February 1975. Employees of the Oil and Natural Gas Commission, the Life Insurance Corporation and the Industrial Finance Corporation were removed from service in breach of the regulations framed under the Acts constituting those bodies. Two questions arose: whether a removal contrary to the regulations entitled the employee to a declaration that he continued in service, or only to damages; and whether an employee of a statutory corporation may claim articles 14 and 16 against it, which is to ask whether such a corporation is an authority within article 12.
Held. The regulations framed by the three bodies have the force of law. They are subordinate legislation made under a specific statutory power, not merely terms of a contract of employment, and the statutory bodies have no free hand to depart from them. It follows that the employees hold a statutory status and are entitled to a declaration of continuance in service where their removal contravened the regulations. And all three statutory bodies are "authorities" within article 12, though the Court stated expressly that their employees are not servants of the Union or of a State.
"Other Authorities": The Early Cases
The concurrence that mattered more than the holding. Mathew J. agreed in the result but reasoned differently. He treated the question as whether the corporation is an instrumentality or agency of the State, looking to the public function it performs and to the reality of State control, rather than only to the statute that created it. That reasoning is the seed of everything in the next chapter.
Why it matters. Two propositions in one case: that the internal rules of a statutory corporation are law, so that breach of them is a legal wrong rather than a breach of contract; and that such corporations are State. And Mathew J's concurrence reframed the question from "was this body created by statute" to "is this body really the government acting under another name", which is a question that can be asked of a company or a society as easily as of a corporation.
What the early cases had not yet answered
Both cases concerned bodies created by a statute. That left the harder case untouched.
Suppose the State does not create a statutory corporation. Suppose it registers a society under the Societies Registration Act, or incorporates a company under the Companies Act, and puts the function there. The body is then created by an ordinary law of general application, in the same way as any private club or company, and there is no special statute conferring powers on it at all.
Is such a body "State"? On the Rajasthan Electricity Board formula, arguably not, because it is not "created by a statute on which powers are conferred". On Mathew J's approach, the answer depends on whether it is an instrumentality of the State, and its legal form is beside the point.
That question is the subject of the next chapter, and the answer given to it is the reason article 12 reaches as far as it does.
A worked example
A State sets up a Housing Board by statute, giving it power to acquire land compulsorily, to allot houses, to fix rents and to evict defaulters, and providing that it shall be run on commercial lines and shall aim to break even. An allottee complains that the allotment rules discriminate, and the Board answers that it is a commercial body and not "State".
Take the three early readings in turn.
Ejusdem generis? The Board is not a government, a legislature or a local authority, so on that reading it would be outside. But Rajasthan State Electricity Board rejects the rule here, because the bodies named in article 12 share no distinct genus, and without a genus the rule cannot operate.
"Other Authorities": The Early Cases
Sovereign function? The Board allots houses and charges rent, which is not obviously a sovereign function. But that reading was also rejected: it is not material that some of the powers conferred are for carrying on commercial activities, because under articles 19(1)(g) and 298 the State itself may carry on trade.
Statutory power? The Board is created by a statute and has been given powers, including compulsory acquisition and eviction, to carry out governmental or quasi-governmental functions. On the surviving reading it is an "other authority" and therefore "State".
Answer. The Board is State, and article 14 binds its allotment rules.
A second point the Board may not have expected. On Sukhdev Singh, regulations framed by such a body under its statute have the force of law. So the allotment rules are not merely administrative instructions: an allottee dealt with in breach of them has a legal right, not just a grievance.
Quick revision
- Three readings competed: ejusdem generis, sovereign function, and statutory power. The third won.
- Rajasthan State Electricity Board: every authority created by statute with governmental or quasi-governmental powers is caught; commercial activity is immaterial; ejusdem generis does not apply because the named bodies share no genus.
- Sukhdev Singh: the regulations of a statutory corporation have the force of law, its employees have statutory status, and such corporations are State.
- Mathew J's concurrence in Sukhdev Singh reframed the enquiry as whether the body is an instrumentality or agency of the State.
- Both cases concerned bodies created by statute. The question they left open was the government company and the registered society.
Test yourself
1. Set out the three competing readings of "other authorities" and say which prevailed.
2. Why does ejusdem generis have no application to article 12? Give the reason, not just the conclusion.
3. Does it matter that a body carries on commercial activity? Which two articles answer that?
4. What two propositions come out of Sukhdev Singh, and which of them was in a concurring judgment?
5. What question did the early cases leave open, and why could their formula not answer it?
The rest of this subject
These notes are cut from the University's printed syllabus. Open the syllabus itself, or the past papers, for the same subject.