States versus agencies of the Union: Test of control and impact under Article 131

On May 8, the Supreme Court reserved its judgment on the maintainability of a suit filed by the State of West Bengal against the Union of India under Article 131 of the Constitution of India. The suit was filed to prevent the Central Bureau of Investigation (CBI) from investigating cases in West Bengal even after withdrawal of consent given by the State under Section 6 of the Delhi Special Police Establishment (DSPE) Act.

A bare reading of Article 131 would show that for a suit to be maintainable under Article 131, two requirements should be fulfilled:

(i) The suit should relate to a dispute between the Government of India and one or more State Governments (or) between one or more State Governments; and

(ii) The dispute should involve a question of law or fact on which the existence or extent of legal right depends.

During the hearings on May 2 and 8, the Union of India opposed the maintainability of the suit filed by the State of West Bengal on point (i) above, mainly on the following grounds:

(i) CBI is an independent legal person and has a separate legal entity outside of Union of India;

(ii) The Union of India has not carried out investigation or registered any case in the State of West Bengal as alleged in the suit, and as such, any order passed by this Court in the suit will be unenforceable;

(iii) There was suppression of facts in the plaint.

The State of West Bengal justified the maintainability of the case on the grounds that:

(i) CBI is the investigative arm of the Union of India, and is not an independent agency;

(ii) Superintendence of the CBI vests with the Union of India;

(iii) Dispute of facts cannot be raised at the stage of maintainability.

The question of suppression of facts cannot be decided at the threshold stage, and hence, cannot be part of the discussion on maintainability of the suit. The questions that thus arise for maintainability of the suit are:

(i) Is CBI an independent entity or is it controlled by the Government of India?

(ii) Is the establishment of control of an agency by the Union Government sufficient for the State to file a suit against the Union under Article 131?

During the hearing on May 8, the Additional Solicitor General (ASG) for India conceded that the CBI cannot initiate an investigation of a case without the authorisation of the Union government under Section 5 of the DSPE Act. This establishes that the CBI is not a fully independent agency since it was established by the Union government and derives its authority to investigate from the Centre.

The object of Article 131, as held by the Supreme Court in State of Karnataka v. Union of India, is for the disputes between the Union and the states to be finally adjudicated by the highest forum so that the parties need not embark upon a time-consuming journey through the hierarchy of courts. The Supreme Court has also consistently held that Article 131 should be ‘widely and generously interpreted’ and that the courts need not take a very ‘restrictive or a hyper-technical view of the State's rights’.

To restrict the scope of Article 131 by rigorous interpretation, as argued by the learned ASG, to situations where there is only a direct dispute between the Union and the states, will thwart the objectives of the Article. Entertaining a suit under Article 131 filed by a state against the Union government for the actions of its agencies, on mere establishment of control or authority by the Union over the agencies, will lead to a surge in litigation under Article 131.

In addition to the lens of control, the courts should look through the lens of impact on the state to approach the question of maintainability under Article 131. In cases of indirect disputes between the agencies of the Union and states, it is not sufficient to establish that the Union exerts control over the agency. An assessment of whether the actions of the agency under Union’s control affects the legal right of the state, based on the facts mentioned in the plaint on an ‘as is’ basis, should be undertaken by the court.

Every state has a constitutional right to exercise powers over its domain as provided under Article 246 and the Seventh Schedule of the Constitution. Any unauthorised intervention by the Union, directly or indirectly, should be construed as a dispute between the Union and the State under Article 131. Considering the allegation that the Union government has been using the CBI to encroach upon the jurisdiction of the State under Items 1 [Public Order] & 2 [Police] in List II of the Seventh Schedule on an ‘as is’ basis, the dispute should be construed as maintainable under Article 131, and should be decided by the Supreme Court on merits.

It is hoped that the Supreme Court will use this opportunity to clarify the applicability of Article 131 to non-traditional Union-State disputes by upholding federalism, which is part of the basic structure of our Constitution.

Haripriya Venkatakrishnan is an Advocate practicing before the Madras High Court and an Associate at Ganesan and Manuraj Legal LLP.