By Shanmugham D Jayan
Article 12 of Indian Constitution has undergone a series of interpretations with myriad logic and reasons being used for giving meaning to the content of the Article. Presently, majority of the books on Constitutional law cite the decision in Ajay Hasia v. Khalid Mujib Sehravardi (AIR 1981 SC 487) as the decisive one with respect to interpretation of Article 12. However, if one takes the pain to traverse the case laws that have been relied for the conclusion arrived at in the said case, certain unexpected but interesting facts can be discerned.
As mentioned earlier, right from 1950s there have been decisions to bring out the meaning or rather the scope of Article 12. Multiple yard sticks relying on different attributes were used during the said period for giving a concrete structure to Article 12.
In 1975 in the case of Sukhdev Singh v. Bhagat Ram (AIR 1975 SC 1331), Supreme Court of India rendered a decision with respect to the scope of Article 12. The same was decided by a Bench of five judges – Justices AN Ray, KK Mathew, YV Chandrachud, A Alagirisamy and AC Gupta. The majority judgement was rendered by Justice Ray on behalf of himself, Justice Chandrachud and Justice Gupta.
Justice KK Mathew wrote a separate concurring judgment in which he, even though agreeing with conclusion of the majority, relied on his own reasoning for the same. Justice Alagirisamy gave a dissenting judgement. The reasoning based on which Justice Mathew arrived at his conclusion can be found in the last sentence of Paragraph 96 of the said judgement. The same reads as follows:
“A finding of state financial support plus an unusual degree of control over the management and policies might lead one to characterize an operation as state action.“
Thus, it can be seen that Justice Mathew is referring to the ‘involvement factor’ of State in an entity to find out whether they said entity is State for the purpose of Article 12. However, the majority decision followed a different ratio and the same ought to have become the guiding one for subsequent cases.
Then came the decision in RD Shetty v. The International Airport Authority of India (AIR 1979 SC 1628). It was rendered by a Bench consisting of Justice PN Bhagwati, VD Tulzapurkar and RS Pathak. Justice Bhagwati rendered the decision for himself and others. In that judgement, there are multiple references to the concurring opinion of Justice Mathew in Sukhdev Singh case including the crucial sentence mentioned earlier. Thus, in this decision, the reliance is not on the majority judgement of Sukhdev but on the concurring opinion of Justice Mathew. The judgement even discusses few attributes, the answer to which may determine whether an entity is State or not.
“It will be thus seen that there are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of Government. We have referred to some of these factors they may summarised under: whether there is any financial assistance given by the State, and if so, what is the magnitude of such assistance whether there is any other form of assistance given by the State, and if so, whether it is of the usual kind or it is extra ordinary, whether there is any control of the management and policies of the corporation by the State and what is the nature and extent of such control, whether the corporation enjoys any State conferred or State protected monopoly status and whether the functions carried out by the corporation are pubic functions closely related to governmental functions. This particularisation of relevant factors is however not exhaustive and by its very nature it cannot be, because with increasing assumption of new tasks, growing complexities of management and administration and the necessity of continuing adjustments in relations between the corporation and the Government calling for flexibility, adaptability and innovative skills, it is not possible to make an exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a corporation is Governmental instrumentality or agency.”“It will be thus seen that there are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of Government. We have referred to some of these factors they may summarised under: whether there is any financial assistance given by the State, and if so, what is the magnitude of such assistance whether there is any other form of assistance given by the State, and if so, whether it is of the usual kind or it is extra ordinary, whether there is any control of the management and policies of the corporation by the State and what is the nature and extent of such control, whether the corporation enjoys any State conferred or State protected monopoly status and whether the functions carried out by the corporation are pubic functions closely related to governmental functions. This particularisation of relevant factors is however not exhaustive and by its very nature it cannot be, because with increasing assumption of new tasks, growing complexities of management and administration and the necessity of continuing adjustments in relations between the corporation and the Government calling for flexibility, adaptability and innovative skills, it is not possible to make an exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a corporation is Governmental instrumentality or agency.” (Pages 1641-2 of AIR 1979 S C 1628)
It can be observed that the logic suggested by Justice Mathew is set out in detail and in a schematic manner in the above judgement.
Then came the celebrated decision in Ajay Hasia case. It was rendered by a five-judge bench comprising Justices YV Chandrachud, PN Bhagwati, VR Krishna Iyer, S Murtaza Fazal Ali and AD Koshal. The judgement was authored by Justice Bhagwati, the same judge who had rendered the decision in RD Shetty case. In his judgment in Ajay Hasia, though Justice Bhagwati refers to Justice Mathew’s judgement in Sukhdev Singh case, he places strong reliance on his own decision in RD Shetty case. (It is to be noted that the entire basis of RD Shetty case with respect to interpretation of Article 12 was Justice Mathew’s Judgement in Sukhdev case). The issue of interpretation of Article 12 is settled by Justice Bhagwati once and for all by the celebrated test wherein he brings in the ‘numbered version’ for clarity and the same is as follows.
On perusing the reported decision, one can find that the same was rendered on 13th of November, 1980. Interestingly, another case was decided on the very same day on an identical issue, that is scope of Article 12. That is the case of Som Prakash v. Union of India (AIR 1981 SC 212). It was decided by a Bench comprising of Justices VR Krishna Iyer, O Chinnappa Reddy and RS Pathak. The following portion of the judgement, which is at page 225, is relevant to this discussion:
Readers may be left wondering about the reasons for the similarity between these two decisions rendered by two different judges of the Supreme Court on the same day. HM Seervai, in his magnum opus, Constitutional Law of India, Fourth Edition, Volume 1, Page Number 387 discusses this aspect. At foot note number 75 in the same page, Seervai explains that it appears likely that judgement of Krishna Iyer J. was available to Bhagwati J. before he delivered the judgement in Hasia’s case, because, except for the test set out in (2), the remaining five tests laid down by Krishna Iyer J. appear to have been re-arranged and bodily incorporated by Bhagwati J. except for an incorrect insertion of “the” in test (3).
The image of the relevant portion of the book is given below.
So, while Ajay Hasia is acknowledged as the landmark decision with respect to Article 12, there is indeed a story behind that celebrated decision. And that story reveals the contribution of Justice KK Mathew, perhaps the real but unsung hero of Article 12 jurisprudence.
Shanmugham D Jayan is a visiting faculty at National University of Advanced Legal Studies (NUALS) Kochi, and Cochin University. He teaches Constitutional Law, Jurisprudence, IT Law and Law of Taxation. He is also a lawyer specialising in taxation.