Law and You > Constitutional Law > Article 12: Ambit of the Definition of the word “State”

Part III of the Constitution contains a long list of fundamental rights and protects substantive as well as procedural rights. Apart from guaranteeing certain basic civil Rights and freedoms to all, they also provide few safeguards to minorities, protecting religious freedoms and cultural rights. The basic aim of having a declaration of fundamental rights is that certain elementary rights such as right to life and personal liberty, freedom of speech, freedom of faith, etc. shall be regarded as inviolable under all conditions. During emergency, however, some curtailment of the Fundamental rights does take place. In this article we shall discuss the ambit of the term ‘State’.

Article 12:

Definition of ‘State’:

In this part, unless the context otherwise requires, the State includes the Government and Parliament of India and the Government and the Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India

It says unless the context otherwise requires the term `State’ includes the following:-

1. The Government and Parliament of India i.e., Executives and legislature of the Union; and
2. The Government and the legislature of each State i.e., Executives and legislature of States; and
3. All local and other authorities within the territory of India; i.e. Municipalities, District Boards, Panchayats, etc. and
4. All local and other authorities under the control of the Government of India.

Territory of India:

Article 1(3) of the Constitution of India states that; “The territory of India shall comprise-

(a) the territories of the States;

(b) the Union territories specified in the First Schedule; and

(c) such other territories as may be acquired.”

In Masthan Sahib v. Chief Commissioner, AIR 1962 SC 797 case, the Supreme Court held that the territory of India for the purposes of Article 12 means the territory of India as defined in Article 1(3).

Purpose of Article 12:

Article 12 defines the term “State”. Defining State was necessary as the Fundamental Rights are expressly guaranteed against the State. The objective behind defining the State was to provide an impetus to the effective enforcement of fundamental rights. The expression state under Article 12 enumerates the authorities against which fundamental rights can be claimed and also it binds such authorities with the obligation to abide by and to respect the fundamental rights of the people.

In the Constituent Assembly, there had been divergent opinions concerning the phraseology of Article 12 since it was couched in the widest extent possible. But Dr. B.R. Ambedkar insisted on its retention so that fundamental rights could be claimed against anybody or authority exercising power over the people. By ‘authority’ he meant every authority which has got either power to make law or an authority on which discretionary power is vested. Besides a closer look at the Article reveals that the words have been added in such a manner as to help the lawgivers to interpret the term with the changing needs of the society and that is the spirit of the framers of the constitution to make it a ‘living document’ which will stand the test of the time.

The definition of the term State under Article 12 is inclusive and not exhaustive. The language of the Article contains two important flexibility terms to cope up with the challenges posed by society. The first one is the expression “includes” which can be used to accommodate new entities within the scope of Article 12. Therefore, authorities not specified in the Article may also fall within it if they otherwise satisfy the characteristic of the ‘State’ or if they perform any functions ordinarily performed by the Government. The second is the use of the expression “unless the context otherwise” that allows the use of the concept of State in different situations in different manner and context.

The language in Article 12 is plain, but the term ‘other authority’ is put to test quite a number of times. In order to extract the true meaning of the term and to further the purpose of fundamental rights the judiciary has evolved the test of instrumentality or agency under which various criteria’s are laid out, one such important test is ‘Public Functions Test,’ other tests being deep and pervasive state control test, government monopoly test, etc. The cumulative effect of all the tests is necessary to hold authority as ‘other authority’ and thereby state under Article 12. These tests try to render a meaningful link between the authority in question and the government.

Article 12 has been put to judicial scrutiny in a number of cases. Indian Constitution preserves the natural rights against State encroachments and constitutes the higher judiciary of the State as the sentinel of the said rights.

Article 12 does not make any reference to the judiciary and therefore the decision of a regularly constituted court, cannot be challenged as interfering the fundamental rights.

The first two categories: the Government and Parliament of India i.e., Executives and legislature of the Union; and the Government and the legislature of each State i.e. Executives and legislature of States are obvious to come under the ambit of definition of “State”. An additional explanation is required for the term local and other authorities.

In Shamdasani v. Central Bank of India, AIR 1952 SC 59 case, the Court held that most fundamental rights are available only against the State and its instrumentalities and not against private bodies. The Court also opined that the language and structure of article 19 and its setting in Part III of the Constitution clearly show that the article was intended to protect these freedoms against the State action.

In State of West Bengal v. Subodh Gopal Bose, AIR 1954 SC 92 case, the court opined that the whole object of Part III of the Constitution is to provide protection for the freedoms and rights mentioned therein against arbitrary invasion by the State.

A State cannot escape from responsibility and liability of protecting the fundamental rights of its citizens. Hence in many cases, courts have given relief to the petitioner without going into the question of whether the violator of the fundamental rights was the State,  as in M.C. Mehta v. Union of India (Shreeram Oleum Gas Leak Case) (1987)1 SCC 395 case.

In I.R. Coelho v. State of Tamil Nadu, AIR 2007 SC 861, case a nine-Judge bench of the Apex Court observed that the Rights were not limited; narrow rights, but provide a broad check against the violations and the excesses by the State authorities. These rights have proved to be the most significant constitutional control on the Government, particularly legislative power. They form a comprehensive test against the arbitrary exercise of state power in any area.

Local Authorities and Other Authorities:

‘Authority’ means a person or body exercising power, or having a legal right to command and be obeyed. ‘An Authority’ is a group of persons with official responsibility for a particular area of activity and having a moral or legal right or ability to control others.

• According to sub-section (31) of Section 3 of the General Clauses Act, 1897 “Local Authority” shall mean a municipal committee, district board, body of the commissioner or other authority legally entitled to or entrusted by the Government within the control or management of a municipal or local fund.
• According to Entry 5 of the List II of 7th Schedule ‘Local government’ includes a municipal corporation, improvement trust, district boards, mining settlement authorities, and other local authorities for the purpose of local self-government or village administration. Village panchayat is also included within the meaning of the term local authority.

In Union of India v. R. C. Jain, AIR 1981 SC 951 case, the Court held that to be considered a “local authority”, an authority must fulfill the following tests-

1. Separate legal existence.
2. Function in a defined area.
3. Has the power to raise funds.
4. Enjoys autonomy.
5. Entrusted by a statute with functions which are usually entrusted to municipalities.

In Mohammad Yasin v. Town Area Committee, AIR 1952 SC 115, case, the Court held that the Bye-laws of a Municipal Committee charging a prescribed fee on the wholesale dealer was an order by the State Authority contravened Article 19(1) (g). These bye-laws in effect and in substance have brought about a total stoppage of the wholesale dealers’ business in the commercial sense. The Supreme Court has ruled that be characterized as a ‘local authority’ the authority concerned must have separate legal existence as a corporate body, it must not be a mere government agency but must be legally an independent entity; it must function in a defined area and must ordinarily, wholly or partly, directly or indirectly, be elected by the inhabitants of the area. It must also enjoy a certain degree of autonomy either complete or partial, must be entrusted by statute with such governmental functions and duties as are usually entrusted to locally like health and education, water and sewerage, town planning and development roads, markets, transportation, social welfare services, etc. Finally, such a body must have the power to raise funds for the furtherance of its activities and fulfillment of its objectives by levying taxes, rates, charges or fees.

Test to determine Local Authorities

In Mohammad Yasin v. Town Area Committee, the Supreme Court held that to be characterized as a ‘local authority’ the authority concerned must;

1. Have a separate legal existence as a corporate body
2. Not be a mere government agency but must be legally an independent entity
3. Function in a defined area
4. Be wholly or partly, directly or indirectly, elected by the inhabitants of the area
5. Enjoy a certain degree of autonomy (complete or partial)
6. Be entrusted by statute with such governmental functions and duties as are usually entrusted to locally (like health, education, water, town planning, markets, transportation, etc.)
7. Have the power to raise funds for the furtherance of its activities and fulfilment of its objectives by levying taxes, rates, charges or fees

In Vibhu Kapoor v. Council of Indian School Certificate Examination, AIR 1985 Del 142 case, the Petitioner was not issued a passing certificate for ISC examination on the ground of having used unfair means. The principles of natural justice were not followed because the petitioner had not been given a chance to be heard or defend himself. Hence the action of the Councill was challenged being arbitrary and contrary to the principles of natural justice. The contention of the respondent Council was that it is not a “State” as under Article 12. the Court held that the respondent had entered into an arrangement with the Government to enable it to discharge its public function of imparting education and thereby had not only received the authority or concession or privilege to conduct examination but had been statutorily recognized as a body of persons or Society recognized and authorized by the Government. The rules and regulations of the respondent show government supervision, if not control.

In the University of Madras v. Santa Bai, AIR 1954 Mad.67 case, the Court held that ‘other authorities’ could only indicate authorities of like nature, i.e., ejusdem generis. So construed it could only mean authorities exercising governmental or sovereign functions. It cannot include persons, natural or juristic. Such as a university unless it is ‘maintained by the State’. But in Umesh v. V. N. Singh, AIR 1968 Pat 3 case, the Patna High Court held that Patna University is a State for purpose of Article 12 of the Constitution.

Other Authorities:

But in Ujjammabai v. State of U.P., AIR 1962 SC 1621, case, above decision was overruled. The Court rejected this restrictive interpretation of the expression ‘other authorities’ given by the Madras High Court and held that the ejusdem generis rule could not be resorted to in interpreting its expression. In Article 12 the bodies specifically named are the Government of Union and the States, the Legislature of the Union and States and local authorities. There is no common genus running through these named bodies nor can these bodies so placed in one single category on any rational basis. A University maintained by a State would fall within the meaning of a State. A university is a statutory body having legislative and administrative powers. Hence a university is held to be within the purview of the authority in Article 12 In Zee Telefilms v. Union of India AIR 2005 SC 2677 case, the Court observed that BCCI (Board of Control for Cricket in India) is not created by a statute, not dominated by the government either financially, functionally or administratively and held that BCCI cannot be called a State as under Article 12 of the Constitution.

In State Electricity Board, Rajasthan v. Mohan Lal AIR 1967 S.C. 1857, the Supreme Court held that ‘other authorities’ would include all authorities created by the constitution or statute on whom powers are conferred by law. It was not necessary that the statutory authority should be engaged in performing government or sovereign functions. The court emphasized that it is not material that some of the power conferred on the concerned authority are of commercial nature. This is because under Art. 298 the government is empowered to carry on any trade or commerce. Thus, the court observed: “ The circumstances that the Board under the Electricity Supply Act is required to carry on some activities of the nature of trade or commerce does not, therefore, give any indication that the ‘Board” must be excluded from the scope of the word ‘State’ is used in Article 12 of the Constitution.

In Sukhdev Singh v. Bhagat Ram, AIR 1975 SC 1331 case, The Supreme Court following the test laid down in Electricity Board Rajasthan’s case has held that Oil and Natural Gas Commission, Life Insurance Corporation and Industrial Finance Corporation are authorities within the meaning of Article 12 of Constitution and therefore they are `State’. All three Statutory Corporations have the power to make regulations under the Statute for regulating conditions of service of their employees.

In Ramana Dayaram Shetty v. The International Airport Authority of India, AIR 1979 SC 1628 Court, pointed out the corporations acting as instrumentality or agency of government would obviously be subject to the same limitation in the field of constitutional or administrative as the government itself, though in the eye of the law they would be distinct and independent legal entities. If the government acting through its officers is subject to certain constitutional and public law limitations, it must follow a fortiori, that government acting through the instrumentality or agency of corporations should equally be subject to the same limitations. Accordingly, International Airport authority which was created by an Act of Parliament was held to be `State’.

In S. P. Rekhi v. Union of India, AIR 1981 SC 212 case, the Court held that Bharat Petroleum Corporation Ltd. (Government Corporation) is also a “State” within the meaning of Article 12 of the Constitution and is, therefore subject to the same constitutional limitations as the Government.

In Bhagat Singh Negi v. H. P. Housing Board, AIR 1994 H&P 60 case, the Court held that a Housing Boar is a “State” for the purpose of Article 12

In The Workmen v. Food Corporation of India, AIR 1985 SC 670 case, the Court held that the Food Corporation of India is an instrumentality of the State, and is, therefore, covered by the expression “Other Authority” in Article 12 of the Constitution.

In Bank of India v. U. P. Swarnanakar, AIR 2003 SC 858 case, the Court held that the Bank of India and the State Bank of India, and also other nationalized banks are “States” within the meaning of Article 12 of the Constitution.

In Shamdasani v. Central Bank of India, AIR 1952 SC 59 case, the Court held that most fundamental rights are available only against the State and its instrumentalities and not against private bodies.

In Ajay Hasia v. Khalid Majid, AIR 1981 SC 487 case, the Court held that an individual, company, or society is acting as an instrumentality of the government, a writ can be filed against such parties also. Bhagwati, J., discussed in detail various factors relevant for determining whether a body is an instrumentality or agency of the state. These factors as they were finally summarized by him are:

1. if the entire share capital of the corporation is held by the government, it would go a long way towards indicating that the corporation is an instrumentality or authority of the government.
2. Where the financial assistance of the state is so much as to meet the almost entire expenditure of the corporation it would afford some indication of the corporation being impregnated with government character.
3. Whether the corporation enjoys monopoly status which is State conferred or state-protected.
4. The existence of deep and pervasive State control may afford an indication of that the corporation is a state agency or instrumentality.
5. If the functions of the corporation are of public importance and closely related to government functions it would be a relevant factor in classifying a corporation as an instrumentality or agency of government.
6. If a department of the government is transferred to the corporation it would be a strong factor supporting the inference of the corporation being an instrumentality or agency of government.

If on considerations of these factors a corporation in an instrumentality or agency of the government, it must be held to be an authority under Article 12. However, these tests are not conclusive or clinching, and it must be realized that it would not be stretched so far as to bring in every autonomous body which has some nexus with the government within the sweep of the expression. Following this approach, it was held that the international Airport Authority constituted under the International Airport Agency Act, 1971 was an authority and, therefore, ‘State’ within the meaning of Article 12.

In General Manager, Kisan Sakhari Chini Mills Ltd., Sultanpur, U.P. v. Satrughan Nishan case, it was held that this corporation is not included in State as it only holds 50% share in the company. Expenditure of the mill was also not met by government. And also there was no deep and pervasive control over the mill

Over a time following authorities are declared as State by the Court

• Hindustan Steel Ltd. ( 1984 Supp SCC 554)
• Indian Council of Agricultural Research (1984) 2 SCC 141
• Coffee Board (1980) 3 SCC 358
• Steel Authority of India Ltd. (1985) 2 SCC 644
• Delhi Stock Exchange (2005) 4 SCC 4
• Council of Scientific and Indian Research (2002) 5 SCC 111
• International Airport Authority of India (1979) 3 SCC 489
• Village Panchayat (AIR 1967 SC 856)

Is Judiciary Included in the Word `State’?

In Naresh Shridhar Mirajkar v. State of Maharashtra, AIR 1967 SC 1 case the Court held that a judicial decision pronounced by a judge of competent jurisdiction in or in relation to a matter brought before him for adjudication cannot affect the fundamental rights of the citizens since what the judicial decision purports to do is to decide the controversy between the parties brought before the court and nothing more. Therefore, such a judicial decision cannot be challenged under Article 13.In A.R. Antulay v. R.S. Nayak, AIR 1988 SC 1531 Supreme Court held that Court cannot pass an order or issue a direction which would be violative of fundamental rights of citizens, so it can be said that the expression `State’ as defined in Article 12 includes judiciary also.

In Rupa Ashok Hurra v. Ashok Hurra AIR 2002 SC 1771 case, the apex court has re-affirmed and ruled that no judicial proceeding could be said to violate any of the fundamental rights. It was said to be settled the position of law that the superior courts of justice did not fall within the ambit of ‘State’ or ‘other authorities’ under Art. 12.

The court is kept out of the ambit of the definition of State to avoid multiplicity of proceedings by raising the same issues first in appeal and then in writ proceedings.

State as Non-Governmental Bodies:

The composition is determined when the representative of government, its expenses are at the cost of the government. The rules made for society are in accordance with the government and it shall also comply with all directions of the government and it should be obviously governed by government then it can be noticed that Non-Statutory bodies are a ‘State’.

In Ajay Hasia v Khalid Mujib, AIR 1981 SC 487 case, the Court observed that any society registered under society Registration Act of 1898 is an “agency” or “instrumentality of the state”. It shall be seen that individual or an organization performing the essence of government or in support of a government or is discharging a duty of state can be considered as a “State”.

In Zee Telefilms v. Union of India AIR 2005 SC 2677 case, the Court observed that BCCI (Board of Control for Cricket in India) is not created by a statute, not dominated by government either financially, functionally or administratively and held that BCCI cannot be called a State as under Article 12 of the Constitution., and a petition can be filed against it.

In Chandra Mohan Khanna v. NCERT AIR 1992 SC 76, NCERT has been held to be outside the scope of Article 12. The court opined that NCERT is a society registered under the Societies Registration Act. It is largely an autonomous body; its activities are not wholly related to governmental functions; governmental control is confined mostly to ensuring that its funds are properly utilized; its funding is not entirely from government sources.

Extending Scope of Article 12:

The recommendation of the national commission to review the working of the Constitution to increase the scope of the article 12 represents the need of the day to include the private bodies under the purview of judicial review in certain cases. The commission has recommended that in article 12 of the Constitution, the following explanation should be added; ‘Explanation: – In this Article, the expression “other authorities” shall include any person in relation to such as it functions which are of a public nature.’

The concept of “the State” in the Constitution of India which has created various interpretational controversies is the meaning of the term “the State” as defined in article 12 of the Constitution of India, to avoid these controversies there is a need to expand either as recommendations given by the National commission to review the working of the Constitution or new article 12A should be inserted relating to for the purpose of particularly private bodies or persons to making them subject to fundamental rights.

Conclusion:

The word ‘State’ under Article 12 has been interpreted by the courts as per the changing times. Through various case laws & their judgements given by The Court and also through various different viewpoints of different judges in giving those judgements or different law writers in their books or law scholars or law students is what which has gained wider meaning for the term ‘other authorities’ and there is a need now to finally define this important term in context to Article 12 i.e., “STATE”

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