RAMAKRISHNA MISSION & ANR. versus KAGO KUNYA & ORS.

[2019] 5 S.C.R.

RAMAKRISHNA MISSION & ANR.

KAGO KUNYA & ORS.

(Civil Appeal No. 2394 of 2019)

BFEBRUARY 28, 2019

[DR DHANANJAYA Y CHANDRACHUD ANDHEMANT GUPTA, JJ.]

Constitution of India: Arts.12 and 226 – Whether appellant-institution is an authority and hence amenable to writ jurisdiction –CRespondent (employee of the hospital run by the appellant) filedpetition u/Art. 226 challenging communication by the appellantregarding his superannuation – Preliminary objection as regardsmaintainability of the petition as the appellant or the hospital werenot State within meaning of Art. 12 – Single Judge of High CourtDheld that appellants were State within meaning of Art. 12 and decidedthe case on merit – Division Bench of High Court held that theappellants fell within category of ‘other authorities’ u/Arts. 12 and226 and hence amenable to writ jurisdiction – On appeal, held:The character of an organization as ‘public authority’ is dependenton the circumstances of the case – Before an organization can beEheld to discharge public function, the functions must be of acharacter that is closely related to functions which are performedby the State in its sovereign capacity – There is no governmentalcontrol in the functioning, administration and day to daymanagement of the appellants – Therefore, the hospital does notFcome within the ambit of public authority – The conditions ofservice of the employees of the hospital are governed by servicerules which are framed by the Mission without the intervention ofany governmental body – Thus, contracts of purely private naturewould not be subject to writ jurisdiction – Therefore, appellantsare not amenable to writ jurisdiction as an ‘Authority’.G

Allowing the appeal, the Court

HELD: 1. The hospital is branch of the respondent(Ramakrishna Mission) and is subject to its control. The activitiesundertaken by the Mission are voluntary, charitable and non-

profit making in nature. These activities are not closely relatedto those performed by the State in its sovereign capacity nor dothey partake of the nature of public duty. [Para 19] [461-C-F]

2. The Governing Body of the Mission is constituted bymembers of the Board of Trustees of Ramakrishna Math and isvested with the power and authority to manage the organization.The properties and funds of the Mission and its managementvest in the Governing Body. Any person can become memberof the Mission if elected by the Governing Body. Members onroll form the quorum of the annual general meetings. TheManaging Committee comprises of members appointed by theGoverning Body for managing the affairs of the Mission. Underthe Memorandum of Association and Rules and Regulations ofthe Mission, there is no governmental control in the functioning,administration and day to day management of the Mission. Theconditions of service of the employees of the hospital aregoverned by service rules which are framed by the Missionwithout the intervention of any governmental body. [Para 20][461-G-H; 462-A-B]

3. Even if the body discharges public function in widersense, there is no public law element involved in theenforcement of private contract of service. In running thehospital, Ramakrishna Mission does not discharge publicfunction. Undoubtedly, the hospital is in receipt of some elementof grant. The grants which are received by the hospital coveronly part of the expenditure. The terms of the grant do notindicate any form of governmental control in the management orday to day functioning of the hospital. The nature of the workwhich is rendered by Ramakrishna Mission, in general,including in relation to its activities concerning the hospital inquestion is purely voluntary. [Para 30] [467-C-F]4. Before an organisation can be held to discharge publicfunction, the function must be of character that is closelyrelated to functions which are performed by the State in itssovereign capacity. There is nothing on record to indicate thatthe hospital performs functions which are akin to those solelyperformed by State authorities. Medical services are providedby private as well as State entities. The character of the

[2019] 5 S.C.R.

Aorganisation as public authority is dependent on thecircumstances of the case. In setting up the hospital, theMission cannot be construed as having assumed publicfunction. The hospital has no monopoly status conferred ormandated by law. That it was the first in the State to provideservice of particular dispensation does not make it anB‘authority’ within the meaning of Article 226. State Governmentsprovide concessional terms to variety of organisations in orderto attract them to set up establishments within the territorialjurisdiction of the State. The State may encourage them as anadjunct of its social policy or the imperatives of economicCdevelopment. The mere fact that land had been provided on aconcessional basis to the hospital would not by itself result in theconclusion that the hospital performs public function. In thepresent case, in absence of State control in the management ofthe hospital the hospital does not come within the ambit of apublic authority. [Para 31] [467-F-H; 468-A-C]D

5. Regulation by statute does not constitute the hospitalas body which is constituted under the statute. Individuals andorganisations are subject to statutory requirements in wholehost of activities. That by itself cannot be conclusive of whethersuch an individual or organisation discharges public function.EThus, contracts of purely private nature would not be subjectto writ jurisdiction merely by reason of the fact that they arestructured by statutory provisions. The only exception to thisprinciple arises in situation where the contract of serviceisgoverned or regulated by statutory provision.F[Paras 32, 33] [468-E-F; 469-C-D]

6. The Clinical Establishments (Registration andRegulation) Act 2010 was enacted to provide for the regulationand registration of clinical establishments with view to prescribeminimum standards of facilities and services. The Act, inter alia,Gstipulates conditions to be satisfied by clinical establishmentsfor registration. However, the Act does not govern contracts ofservice entered into by the Hospital with respect to itsemployees. These fall within the ambit of purely private contracts,against which writ jurisdiction cannot lie. The sanctity of thisdistinction must be preserved. [Paras 32, 34] [468-B; 469-E-F]H

7. The Division Bench of the High Court was not justifiedin coming to the conclusion that the appellants are amenable tothe writ jurisdiction under Article 226 of the Constitution as anauthority within the meaning of the Article. Neither theRamakrishna Mission, nor the hospital would constitute anauthority within the meaning of Article 226 of the Constitution.[Paras 35, 36] [469-F-H]

Satyabrata Chakraborty v. State of Arunachal Pradesh2005 (4) GLT 150; Andi Mukta Sadguru ShreeMuktajee Vandas Swami Suvarna Jayanti MahotsavSmarak Trust v. V R Rudani (1989) 2 SCC 691 :[1989] 2 SCR 697 ; VST Industries Ltd v. VSTIndustries Workers’ Union (2001) 1 SCC 298 : [2000]5 Suppl. SCR 438 ; Bassi Reddy v InternationalCrops Research Institute (2003) 4 SCC 225 : [2003] 1SCR 1174 ; Ramesh Ahluwalia v. State of Punjab(2012) 12 SCC 331 : [2012] 12 SCR 315 ; FederalBank Ltd. v Sagar Thomas (2013) 10 SCC 733 :[2003] 4 Suppl. SCR 121– relied on.

Federal Bank Ltd. v Sagar Thomas (2013) 10 SCC 733:[2003] 4 Suppl. SCR 121 ; Binny Ltd. v V Sadasivan(2005) 6 SCC 657 : [2005] 2 Suppl. SCR 421 ;K K Saksena v International Commission on Irrigationand Drainage (2015) 4 SCC 670 ; Ajay Hasia v KhalidMujib Sehravardi (1981) 1 SCC 722 : [1981] 2 SCR79; Pradeep Kumar Biswas v. Indian Institute ofChemical Biology (2002) 5 SCC 111 : [2002] 3 SCR100; Jatya Pal Singh v. Union of India (2013) 6 SCC452 : [2013] 2 SCR 970 – referred to.

Case Law Reference

CIVIL APPELLATE JURISDICTION: Civil Appeal No.2394 ofC2019.

From the Impugned Interim Order dated 06.04.2018 of the GauhatiHigh Court, Itanagar Bench in W.A. No.25(AP)/2017

Abhishek Manu Singhvi, K.V. Viswanathan, Sr. Advs., ArijitMazumdar, Amit Bhandari, Arunabha Deb, Shambo Nandy, AbhinavDMukerji, Deepan Kumar Sarkar, Advs. for the Appellants.

A. Tewari, Ms. Eliza Bar, Shree Pal Singh, Ms. Priyanka Das,Vibhu Shankar Mishra, Ms. Ragni Pandey, Raj Bahadur, Mrs. AnilKatiyar, Advs. for the Respondents.

The Judgment of the Court was delivered by

DR DHANANJAYA Y CHANDRACHUD, J.

1. Leave granted.

2 . This appeal has arisen from the judgment of Division Benchof the Gauhati High Court in Writ Appeal against judgment of aFlearned Single Judge. The learned Single Judge, by judgment dated 7September 2016, held that Ramakrishna Mission is ‘State’ within themeaning of Article 12 of the Constitution of India. In appeal, the DivisionBench held that while Ramakrishna Mission may not be ‘State’ withinthe meaning of Article 12 in the strict sense of the term, nonetheless its

Ghospital at Itanagar performs public duty and in consequence would beamenable to the writ jurisdiction under Article 226 of the Constitution ona liberal interpretation of the expression ‘authority’ in that Article.

3. The first respondent joined the Ramakrishna Mission Hospitalat Itanagar on 15 March 1980 as General Duty Worker. He was

regularised with effect from 1 August 1980 by letter dated 23 July1980. On 31 March 1982, the first respondent was promoted to thesubstantive post of Nursing Aid. He was made permanent on 13 April1984.Subsequently on 31 December 2005, he was promoted as anOffice Assistant with effect from 1 October 2005.

4. The conditions of service of the employees of the hospital aregoverned by the Service Rules. Among them is Rule 18 which providesfor superannuation in the following terms:

“18. SUPERANNUATION (RETIREMENT):

(i) permanent employee/staff shall normally retire from theservices of the Hospital after 35 years of service or an attainingthe age of 60 (sixty) years. Provided further, the Management inthe service of the Hospital may extend the service of an employee/staff even after 35 years of service or he attains the age of 60(sixty) years, whichever is earlier, subject to his medical fitness,in slots of 1 (one) years at time.

(ii) However, an employee/staff may be retired earlier if in theevent of suffering from physical or mental incapacity in thedischarge of his duties provided the physical or mental incapacityof the employee/staff is established by Medical Board dulyconstituted by the Management.”

On 31 January 2015, the hospital informed the first respondentthat he would be retiring from service on 24 March 2015 in accordancewith the Service Rules, consequent upon the completion of thirty-fiveyears of service.

5. The first respondent instituted writ petition under Article 226of the Constitution before the Gauhati High Court to challenge the abovecommunication and sought writ of mandamus to allow him to continuein service until he completes thirty-five years of service, counting theappointment from 31 March 1982 when he was substantively appointedas Nursing Aid.

6. The appellants raised preliminary objection to themaintainability of the petition on the ground that neither RamakrishnaMission nor its hospital is ‘State’ within the meaning of Article 12 andthey are not amenable, in any event, to the writ jurisdiction under Article226 of the Constitution of India.

A7. The learned Single Judge allowed the Writ Petition. Whilerejecting the objections of the appellants to the maintainability of the writpetition, the learned Single Judge held that the appellants fall within thedescription of ‘State’ within the meaning of Article 12. direction wasissued, on merits, to the hospital to treat the date of appointment of thefirst respondent as 31 March 1982 and not 15 March 1980.B

8. In consequence, the first respondent was effectively grantedan extension of service for two years beyond the date of superannuationas computed on the basis of the initial date of joining service. The firstrespondent has been paid his terminal dues on the basis of the date ofretirement as computed by the hospital.C

9. The Writ Appeal by the appellants failed before Division Benchof the High Court. The Division Bench, while dismissing the appeal,principally relied upon two circumstances:

(i) The hospital was availing of funds for part of its expenditureDand was running sixty bedded hospital which constitutes apublic duty; and

(ii) There was decision of Single Judge of the High Court inSatyabrata Chakraborty v State of Arunachal Pradesh[1],holding that Ramakrishna Mission fell with the category of‘other authorities’ under Articles 12 and 226 of theEConstitution. The High Court held that this decision of the learnedSingle Judge which had held the field for thirteen years shouldnot be disturbed. It was further held that the appellant isrunning very large hospital in the State and utilised publicfunds for part of its operation and would be amenable to writFjurisdiction. While answering the preliminary issues against theappellants, the High Court directed that the appeal be placedfor hearing subsequently.

10. While entertaining the present proceedings, this Court by itsorder dated 19 November 2018 issued notice and granted stay of theGjudgment and order of the High Court dated 6 April 2018. In pursuanceof the order issuing notice, counter affidavit has been filed on behalf ofthe Union of India through the Ministry of Tribal Affairs as well as bythe Government of Arunachal Pradesh.

12005 (4) GLT 150H

11. The State government, in support of the view which has beentaken by the High Court, has submitted that:

(i) The land over which Ramakrishna Mission Hospital wasconstructed was allotted to the appellants on 12 July 1984 on aconcessional rate;

(ii) Subsequently on 4 May 2005, additional land admeasuring 4.66acres was also allotted on concessional rate; and

(iii) The hospital receives grants from the State government.

12. The counter affidavit filed by the Union of India does notrequire to be dealt with, since the Ministry of Tribal Affairs is notconcerned with the subject matter of the present appeal.

13. On behalf of the appellants, it has been submitted byDr Abhishek Manu Singhvi, and Mr K V Viswanathan, learned seniorcounsel that the High Court in the present case has placed reliance onthe decision of this Court in Andi Mukta Sadguru Shree MuktajeeVandas Swami Suvarna Jayanti Mahotsav Smarak Trust v V RRudani[2], without noticing the clear distinction in that case both on factsand law. It was urged that the aforesaid judgment dealt with case of apublic trust which was managing college affiliated to University. Thedispute in regard to the closure of the college and the consequentnon-payment of salaries squarely fell within the purview of theregulatory provisions contained in the Ordinances of the University. Thatapart, it has been submitted that:

(i) No public duty is performed by the first respondent;

(ii) Ramakrishna Mission has established and manages thehospital purely as voluntary service to society;

(iii) The conditions of service of the employees of the hospital arenot governed either by statute or by subordinate legislation andhence, there is no public law element involved in enforcing apurely private contract of service; and

(iv) As result of the impugned judgment of the High Court, theentire range of activities of Ramakrishna Mission will fall withinthe description of an ‘authority’ within the meaning of Article226.

2(1989) 2 SCC 691

AOn these grounds, it was sought to be urged that the judgment ofthe High Court is contrary to line of precedent of this Court, to whichwe will advert little later. That apart, learned senior counsel submittedthat each of the circumstances which weighed with the High Court incoming to the conclusion that the appellants are amenable to the exer-cise of the writ jurisdiction under Article 226 is contrary to the settledBposition in law.

14. On the other hand, Mr Tewari, learned counsel appearingon behalf of the State of Arunachal Pradesh has placed reliance on thestatement of facts contained in the counter affidavit, as noticed earlier.Learned counsel submitted that the Ramakrishna Mission Hospital isCthe only hospital in the State of Arunachal Pradesh and hence, by virtueof its monopoly status, must be held to be amenable to the writjurisdiction under Article 226. That apart, it was urged that the hospitalreceives grants in aid from the State government. The function ofconducting hospital in the State of Arunachal Pradesh, it was urged,Dmust be held to be public function rendering the appellants amenableto the jurisdiction of the High Court under Article 226.

15. The rival submissions fall for consideration.

16. Ramakrishna Mission runs 263 bedded hospital at Itanagar.The grant in aid which is provided by the State government covers theEcost of running 60 beds out of 263 bedded hospital. Relevant factualdata in regard to the nature and extent of the grants has been placed onrecord. About 32.26 per cent of the total income of the hospital for2014-2015, 23.33 for 2015-16 and 22.53 per cent for 2016-17 was fromthe grants provided by the State government. The revenue expenditure,Fthe audited balance sheets and accounts of the hospital indicate that35.23 per cent of the expenditure for 2014-2015, 23.83 per cent for2015-2016 and 20.57 per cent for 2016-2017 was borne from the fi-nances provided by the State government.17. In assessing whether the appellants are amenable to the writGjurisdiction under Article 226, we proceed on the basis of the followingcircumstances which have been pressed in aid both on behalf of theoriginal petitioner before the High Court and, in response to the presentappeal, by the State government:

(i) portion of the income of the hospital is generated out of thegrants which are received from the State; andH

(ii)Land has been made available for the construction of the hospi-tal by the State government on concessional rate.

The grant by the State government covers only portion, namely,60 beds out of the 263-beds of the hospital at Itanagar. Significantly, theState government does not control the day to day functioning of thehospital. The management of the hospital is exclusively with theRamakrishna Mission. Since the State government finances through itsgrants portion of the income of the hospital, it requires the auditedaccounts to be submitted to the State government for scrutiny.

18. The basic issue before this Court is whether the functionsperformed by the hospital are public functions, on the basis of which awrit of mandamus can lie under Article 226 of the Constitution.

19. The hospital is branch of the Ramakrishna Mission and issubject to its control. The Mission was established by Swami Vivekanand,the foremost disciple of Sri Ramakrishna Paramhansa. Service tohumanity is for the organisation co-equal with service to God as isreflected in the motto “Atmano Mokshartham Jagad Hitaya Cha”.The main object of the Ramakrishna Mission is to impart knowledge inand promote the study of Vedanta and its principles propounded by SriRamakrishna Paramahansa and practically illustrated by his own lifeand of comparative theology in its widest form. Its objects include, interalia to establish, maintain, carry on and assist schools, colleges,universities, research institutions, libraries, hospitals and take updevelopment and general welfare activities for the benefit of theunderprivileged/ backward/ tribal people of society without anydiscrimination. These activities are voluntary, charitable and non-profitmaking in nature. The activities undertaken by the Mission, non-profitentity are not closely related to those performed by the state in itssovereign capacity nor do they partake of the nature of public duty.

20. The Governing Body of the Mission is constituted bymembers of the Board of Trustees of Ramakrishna Math and is vestedwith the power and authority to manage the organization. The propertiesand funds of the Mission and its management vest in the GoverningBody. Any person can become member of the Mission if elected bythe Governing Body. Members on roll form the quorum of the annualgeneral meetings. The Managing Committee comprises of membersappointed by the Governing Body for managing the affairs of the

AMission. Under the Memorandum of Association and Rules andRegulations of the Mission, there is no governmental control in thefunctioning, administration and day to day management of the Mission.The conditions of service of the employees of the hospital are governedby service rules which are framed by the Mission without theintervention of any governmental body.B

21. In coming to the conclusion that the appellants fell within thedescription of an authority under Article 226, the High Court placed aconsiderable degree of reliance on the judgment of two judge Benchof this Court in Andi Mukta (supra). Andi Mukta (supra) was casewhere public trust was running college which was affiliated to GujaratCUniversity, body governed by State legislation. The teachers of theUniversity and all its affiliated colleges were governed, insofar as theirpay scales were concerned, by the recommendations of the UniversityGrants Commission. dispute over pay scales raised by the associationrepresenting the teachers of the University had been the subject matterDof an award of the Chancellor, which was accepted by the governmentas well as by the University. The management of the college, inquestion, decided to close it down without prior approval. writ petitionwas instituted before the High Court for the enforcement of the right ofthe teachers to receive their salaries and terminal benefits inaccordance with the governing provisions. In that context, this CourtEdealt with the issue as to whether the management of the college wasamenable to the writ jurisdiction. number of circumstances weighed inthe ultimate decision of this Court, including the following:

(i) The trust was managing an affiliated college;

F(ii) The college was in receipt of government aid;

(iii) The aid of the government played major role in the control,management and work of the educational institution;

(iv) Aided institutions, in similar manner as governmentinstitutions, discharge public function of imparting educationGto students;

(v) All aided institutions are governed by the rules and regulationsof the affiliating University;

(vi) Their activities are closely supervised by the University; and

(vii) Employment in such institutions is hence, not devoid of apublic character and is governed by the decisions taken by theUniversity which are binding on the management.

22. It was in the above circumstances that this Court came to theconclusion that the service conditions of the academic staff do notpartake of private character, but are governed by right-duty relation-ship between the staff and the management. breach of the duty, it washeld, would be amenable to the remedy of writ of mandamus. Whilethe Court recognized that “the fast expanding maze of bodies affectingrights of people cannot be put into watertight compartments”, it laiddown two exceptions where the remedy of mandamus would not beavailable:

“15. If the rights are purely of private character no mandamuscan issue. If the management of the college is purely privatebody with no public duty mandamus will not lie. These are twoexceptions to mandamus…”

23. Following the decision in Andi Mukta(supra),this Court hashad the occasion to re-visit the underlying principles in successive deci-sions. This has led to the evolution of principles to determine what con-stitutes ‘public duty’ and ‘public function’ and whether the writ ofmandamus would be available to an individual who seeks to enforce herright.

24. In VST Industries Ltd v VST Industries Workers’ Union[3],a two judge Bench of this Court held that mere violation of the condi-tions of service will not provide valid basis for the exercise of the writjurisdiction under Article 226, in situation where the activity does nothave the features of public duty. This Court noted:

“7. In de Smith, Woolf and Jowell’s Judicial Review ofAdministrative Action, 5th Edn., it is noticed that not all the activitiesof the private bodies are subject to private law e.g. the activitiesby private bodies may be governed by the standards of public lawwhen its decisions are subject to duties conferred by statute orwhen, by virtue of the function it is performing or possibly itsdominant position in the market, it is under an implied duty to actin the public interest… After detailed discussion, the learned authorshave summarised the position with the following propositions:

A(1) The test of whether body is performing public function,and is hence amenable to judicial review, may not depend upon the sourceof its power or whether the body is ostensibly ‘public’ or ‘private’body.

(2) The principles of judicial review prima facie govern the activitiesBof bodies performing public functions.”

“(3) …In the following two situations judicial review willnot normally be appropriate even though the body may beperforming public function:

(a) Where some other branch of the law more appropriatelyCgoverns the dispute between the parties. In such case,that branch of the law and its remedies should and normallywill be applied; and

(b) where there is contract between the litigants. In sucha case the express or implied terms of the agreement shouldDnormally govern the matter. This reflects the normalapproach of English law, namely, that the terms of contractwill normally govern the transaction, or other relationshipbetween the parties, rather than the general law. Thus,where special method of resolving disputes (such asEarbitration or resolution by private or domestic tribunals)has been agreed upon by the parties (expressly or bynecessary implication), that regime, and not judicial review,will normally govern the dispute.”(Emphasis supplied)

25. In Bassi Reddy v International Crops ResearchInstitute[4], two judge Bench of this Court dealt with whether theFInternational Crop Research Institute for the Semi-Arid Tropics(“ICRISAT”) which is non-profit research and training centre, isamenable to the writ jurisdiction under Article 226. The disputeconcerned the termination of employees of ICRISAT. The Court heldthat only functions which are similar or closely related to those that areGperformed by the State in its sovereign capacity qualify as ‘publicfunctions’ or ‘public duty’:

“28. writ under Article 226 can lie against “person” if it is astatutory body or performs public function or discharges public

H4(2003) 4 SCC 225

or statutory duty…ICRISAT has not been set up by statute norare its activities statutorily controlled. Although, it is not easy todefine what public function or public duty is, it can reasonablybe said that such functions are similar to or closely related tothose performable by the State in its sovereign capacity. Theprimary activity of ICRISAT is to conduct research and trainingprogrammes in the sphere of agriculture purely on voluntarybasis. service voluntarily undertaken cannot be said to be apublic duty. Besides ICRISAT has role which extends beyondthe territorial boundaries of India and its activities are designed tobenefit people from all over the world. While the Indian publicmay be the beneficiary of the activities of the Institute, it certainlycannot be said that ICRISAT owes duty to the Indian public toprovide research and training facilities.”

Applying the above test, this Court upheld the decision of theHigh Court that the writ petition against ICRISAT was not maintainable.

26. similar view was taken in Ramesh Ahluwalia v State ofPunjab[5], where two judge Bench of this Court held that private bodycan be held to be amenable to the jurisdiction of the High Court underArticle 226 when it performs public functions which are normally ex-pected to be performed by the State or its authorities.

27. In Federal Bank Ltd. v Sagar Thomas,[6] this Court analysedthe earlier judgements of this Court and provided classification of en-tities against whom writ petition may be maintainable:

“18. From the decisions referred to above, the position that emergesis that writ petition under Article 226 of the Constitution of Indiamay be maintainable against (i) the State (Government); (ii) anauthority; (iii) statutory body; (iv) an instrumentality or agencyof the State; (v) company which is financed and owned bythe State; (vi) private body run substantially on Statefunding; (vii) private body discharging public duty orpositive obligation of public nature; and (viii) person or abody under liability to discharge any function under anystatute, to compel it to perform such statutory function.”

(emphasis supplied)

5 (2012) 12 SCC 331

6(2013) 10 SCC 733

466SUPREME COURT REPORTS

A28. In Binny Ltd. v V Sadasivan[7], two judge Bench of thisCourt noted the distinction between public and private functions. It heldthus:

“11…It is difficult to draw line between public functions andprivate functions when they are being discharged by purelyBprivate authority. body is performing “public function” when itseeks to achieve some collective benefit for the public or sectionof the public and is accepted by the public or that section of thepublic as having authority to do so. Bodies therefore exercisepublic functions when they intervene or participate in social oreconomic affairs in the public interest.”C

The Bench elucidated on the scope of mandamus:

“29. However, the scope of mandamus is limited to enforcementof public duty. The scope of mandamus is determined by thenature of the duty to be enforced, rather than the identityDof the authority against whom it is sought. If the privatebody is discharging public function and the denial of anyright is in connection with the public duty imposed on suchbody, the public law remedy can be enforced. The duty caston the public body may be either statutory or otherwise and thesource of such power is immaterial, but, nevertheless, there mustEbe the public law element in such action…There cannot be anygeneral definition of public authority or public action. Thefacts of each case decide the point.”

(emphasis supplied)

29. More recently in K K Saksena v International CommissionFon Irrigation and Drainage[8], another two judge Bench of this Courtheld that writ would not lie to enforce purely private law rights.Consequently, even if body is performing public duty and is amenableto the exercise of writ jurisdiction, all its decisions would not be subjectto judicial review. The Court held thus:G“43. What follows from minute and careful reading of theaforesaid judgments of this Court is that if person or authority is“State” within the meaning of Article 12 of the Constitution,admittedly writ petition under Article 226 would lie against such

7(2005) 6 SCC 657H8 (2015) 4 SCC 670

person or body. However, we may add that even in such caseswrit would not lie to enforce private law rights. There are catenaof judgments on this aspect and it is not necessary to refer tothose judgments as that is the basic principle of judicial review ofan action under the administrative law. The reason is obvious. Aprivate law is that part of legal system which is part of commonlaw that involves relationships between individuals, such as lawof contract or torts. Therefore, even if writ petition would bemaintainable against an authority, which is “State” under Article12 of the Constitution, before issuing any writ, particularly writ ofmandamus, the Court has to satisfy that action of such an authority,which is challenged, is in the domain of public law as distinguishedfrom private law.”

Thus, even if the body discharges public function in widersense, there is no public law element involved in the enforcement of aprivate contract of service.

30. Having analysed the circumstances which were relied uponby the State of Arunachal Pradesh, we are of the view that in runningthe hospital, Ramakrishna Mission does not discharge public function.Undoubtedly, the hospital is in receipt of some element of grant. Thegrants which are received by the hospital cover only part of theexpenditure. The terms of the grant do not indicate any form ofgovernmental control in the management or day to day functioning ofthe hospital. The nature of the work which is rendered by RamakrishnaMission, in general, including in relation to its activities concerning thehospital in question is purely voluntary.

31. Before an organisation can be held to discharge publicfunction, the function must be of character that is closely related tofunctions which are performed by the State in its sovereign capacity.There is nothing on record to indicate that the hospital performsfunctions which are akin to those solely performed by State authorities.Medical services are provided by private as well as State entities. Thecharacter of the organisation as public authority is dependent on thecircumstances of the case. In setting up the hospital, the Mission cannotbe construed as having assumed public function. The hospital has nomonopoly status conferred or mandated by law. That it was the first in

ABC

Athe State to provide service of particular dispensation does not make itan ‘authority’ within the meaning of Article 226. State governmentsprovide concessional terms to variety of organisations in order toattract them to set up establishments within the territorial jurisdiction ofthe State. The State may encourage them as an adjunct of its socialpolicy or the imperatives of economic development. The mere fact thatBland had been provided on concessional basis to the hospital would notby itself result in the conclusion that the hospital performs publicfunction. In the present case, the absence of state control in themanagement of the hospital has significant bearing on our coming tothe conclusion that the hospital does not come within the ambit of aCpublic authority.32. It has been submitted before us that the hospital is subject toregulation by the Clinical Establishments (Registration and Regulation)Act 2010. Does the regulation of hospitals and nursing homes by lawrender the hospital statutory body? Private individuals and organizationsDare subject to diverse obligations under the law. The law is ubiquitousphenomenon. From the registration of birth to the reporting of death, lawimposes obligations on diverse aspects of individual lives. Fromincorporation to dissolution, business has to act in compliance with law.But that does not make every entity or activity an authority under Article226. Regulation by statute does not constitute the hospital as bodyEwhich is constituted under the statute. Individuals and organisations aresubject to statutory requirements in whole host of activities today.That by itself cannot be conclusive of whether such an individual ororganisation discharges public function. In Federal Bank (supra),while deciding whether private bank that is regulated by the BankingFRegulation Act, 1949 discharges any public function, the court held thus:

“33. …in our view, private company carrying on banking businessas scheduled bank, cannot be termed as an institution or acompany carrying on any statutory or public duty. private bodyor person may be amenable to writ jurisdiction only where itGmay become necessary to compel such body or association toenforce any statutory obligations or such obligations of public naturecasting positive obligation upon it. We don’t find such conditionsare fulfilled in respect of private company carrying on acommercial activity of banking. Merely regulatory provisions

to ensure such activity carried on by private bodies workwithin discipline, do not confer any such status upon thecompany nor put any such obligation upon it which may beenforced through issue of writ under Article 226 of theConstitution. Present is case of disciplinary action beingtaken against its employee by the appellant Bank. Therespondent’s service with the Bank stands terminated. Theaction of the Bank was challenged by the respondent byfiling writ petition under Article 226 of the Constitutionof India. The respondent is not trying to enforce any statutoryduty on the part of the Bank…”

(emphasis supplied)

33. Thus, contracts of purely private nature would not be sub-ject to writ jurisdiction merely by reason of the fact that they are struc-tured by statutory provisions. The only exception to this principle arisesin situation where the contract of serviceis governed or regulated bya statutory provision. Hence, for instance, in K K Saksena (supra) thisCourt held that when an employee is workman governed by the Indus-trial Disputes Act, 1947, it constitutes an exception to the general prin-ciple that contract of personal service is not capable of being specifi-cally enforced or performed.

34. It is of relevance to note that the Act was enacted to providefor the regulation and registration of clinical establishments with viewto prescribe minimum standards of facilities and services. The Act, interalia, stipulates conditions to be satisfied by clinical establishments forregistration. However, the Act does not govern contracts of serviceentered into by the Hospital with respect to its employees. These fallwithin the ambit of purely private contracts, against which writ jurisdic-tion cannot lie. The sanctity of this distinction must be preserved.

35. For the above reasons, we are of the view that the DivisionBench of the High Court was not justified in coming to the conclusionthat the appellants are amenable to the writ jurisdiction under Article226 of the Constitution as an authority within the meaning of the Article.

36. For the reasons that we have adduced above, we hold thatneither the Ramakrishna Mission, nor the hospital would constitute anauthority within the meaning of Article 226 of the Constitution.

A37. Before concluding, it would be necessary to also advert to thefact that while the learned Single Judge had come to the conclusion thatthe appellants are ‘State’ within the meaning of Article 12, the DivisionBench has not accepted that finding. The Division Bench ruled, as wehave noticed earlier, that the appellants do not fall within the descriptionof ‘State’ under Article 12. This finding has not been challenged beforeBthis Court by the State of Arunachal Pradesh.

38. Even otherwise, we are clearly of the view that the testswhich have been propounded in the line of authority of this Court in AjayHasia v Khalid Mujib Sehravardi[9], Pradeep Kumar Biswas vIndian Institute of Chemical Biology[10] and Jatya Pal Singh v UnionCof India[11] support the conclusion of the High Court that the appellantsare not ‘State’ within the meaning of Article 12 of the Constitution ofIndia.

39. For the above reasons, we allow the appeal and set aside thejudgment and order of the High Court dated 6 April 2018 in Writ AppealDNo 25 (AP/2017). In consequence, the writ petition filed before theHigh Court namely W.P. (Civil) No 520 (AP/2015) shall stand dismissed.There shall be no order as to costs.

40. Pending application(s), if any, shall stand disposed of.

Kalpana K. Tripathy

Appeal allowed.

9(1981) 1 SCC 72210(2002) 5 SCC 11111(2013) 6 SCC 452