(1) This is an appeal against the order of the learned single Judge holding that the Indian Leprosy Association (Hind Kusht Niwaran Sangh) hereinafter to be called the Sangh) is not an authority or a State Government within Article 12 of the Constitution and no writ petition is. thereforee, maintainable.
(2) The facts leading to the writ petition are that by memorandum of 1-5-1980 the appellant was informed that he had been selected for the post of Assistant Editor to the journal 'Leprosy in India' run by the Sangh. He was put on probation for a period of one year. His services could be terminated during the period of probation without any notice and without assigning any reason, thereafter the services will be terminable on one months' notice on either side. By a memo of 13-9-1980 the appellant was informed that his services will stand terminated w.e.f. 14-10-1980. This was in pursuance of the resolution of the Sangh dated 19-8-1980. The appellant then chellenged his termination by means of a writ petition alleging that the termination was illegal, malafide and discriminatory. It appears that he had also asked for stay of impugned order and when the matter came up before the learned Judge he also heard the petition on merits. Having come to the conclusion that the Sangh is not an authority within the meaning of Article 12 of writ petition was dismissed by the learned Judge. The appellant thereafter filed an appeal and reiterated the same please.
(3) As the learned single Judge had disposed of the matter at the time when the stay application was heard the respondents had not filed any counter affidavit on merits and as Mr. Charya wanted to refer to his pleadings to show that the Sangh is an instrumentality or an agency of the State we permitted the counter affidavit to be filed by the respondents. Mr. Charya also filed a rejoinder and thereafter the appeal was heard.
(4) The Sangh runs a journal 'Leprosy in India'. A decision was taken to appoint an Assistant Editor and an advertisement was given in the press. In pursuance of that various persons including the appellant were called for interview. Ultimately the Committee recommended a panel of 3 names for the post. The appellant being at No. I was offered the appointment by the memo of 1-5-1980 on the terms mentioned therein including the term that his services were liable to be terminated without notice during the period of probation and thereafter by one months' notice. The appellant claims that the termination of his services by a memo of 13-10-1980 was with a view to appoint respondent No. 2, at the initiative of the Secretary of respondent No. 1. Allegations are made that the respondent No. 2 was not qualified and yet he was appointed after terminating the services of the appellant notwithstanding that there were other people who had been put on the panel by the Committee. The termination of service of the appellant and the subsequent appointment of respondent No. 2 are said to be tainted with bias, prejudice and malafide. Most of the allegations are directed against Dr. Dharmendra, Vice Chairman and one of the members of the Governing Body of the Sangh who was said to be keen on having respondent No. 2 appointed. The allegations of malafide and suggestion of extraneous reason for termination of respondent No. 2 are denied in the counter affidavit. It is stated that Dr. Dharmendra is the Hony. Editor of the Journal and he had even pointed out at the time of selection of the appellant that he was promised the assistance of a part-time steno-typist besides the Assistant Editor but the steno-typist was not provided and as the appellant did not know shorthand he was greatly handicap in bringing out the Journal. Dr. Dharmendra is also said to have pointed out that the appellant was in-experienced and his English was poor and he was not suitable for the job. It is denied that respondent No. 2 was a raw-hand. On the other hand it is pointed out that he was working as an Assistant Editor for about 4 112 years with the Sangh. He is B. A. (Hons.) in English and has taken a diploma in journalism and diploma in Book publishing with specialisation in Editing. He is also said to be an efficient stenographer as well as a typist. He had already worked as 'Assistant to the Editor', 'Leprosy in India' for over 4 112 years and it was on account of these plus points that he was appointed. The appellent, it is stated was selected as Assistant Editor even when he did not know stenography, which was one of the essential qualifications. The Editor, Dr. Dharmendra was satisfied with the work of respondent No. 2. It was vehemently denied that Dr. Dharmendra was in any way motivated against the appellant, he was doing honorary work for the Sangh and was a known authority in the field. We have only reproduced the allegations and counter allegations but we do not intend to give any decision on merits for the reason that we are in agreement with the learned single Judge that the Sangh is not a State within the meaning of Article 12 and writ petition being incompetent has to be dismissed.
(5) Leprosy is a National Health Problem affecting directly about 3.2 million people while about 400 million people are living in endemic areas. About 4 lakhs of the sufferers are socio-economically dislocated, and about 8 lakhs are deformed. 15 per cent of the cases are children below 14 years. Considering the magnitude of this problem, especially with its social stigma, the work done by any voluntary leprosy orgnisation is of great help to the nation.
(6) Respondent No. I, society is registered under the Societies Registration Act 1870. It was registered on 19-8-1949. The governing body after the first one was to consist of the Chairman, the Hony. Treasurer and Secretary, all being nominated by the President of India, it may be mentioned that the President of India by virtue of Rule 1 is to be the President of the Sangh. The other 40 members of the Sangh are to consist of one representing each State branch, 5 shall be nominated by the President, 5 shall be elected by the members at the Annual General Meeting, 2 shall be elected by Leprosy Workers and not more than 7 shall be co-opted by the Governing Body at its discretion. Rule 22 provides for the Governing Body to appoint any paid officers or clerks and other servants they may think proper. By Rule 15 the Management of all the affairs and funds of the Sangh shall vest in the Governing Body which shall have authority to carry out its objects and exercise all the powers of the Sangh. Rule 26 empowers the Governing Body to frame Bye-Laws, and to repeal, vary or alter such Bye-Laws from time to time.
(7) The income of the Sangh mainly comprises of accrual of interest from fixed deposits, subscription for journals and newsletters, sale proceeds, donations from public and other institutions. The approximate yearly budget of the respondent Sangh is stated to be of 4- lakhs. The Govt. of India gives about 25,000|-, per annum for the specific purpose of the journal only. The Sangh is on of the voluntary organisations which are existing all over the country to meet the challenge of leprosy. It is stated that on a request by the Sangh in October, 1973 the Government of India gave a grant of Rs. 25,000[- per year from the financial year 1974-75 for the specific purpose of the publication of its quarterly scientific journal 'Leprosy in India'. But this grant had been discontinued since 1977. The Sangh is not receiving any grant for research and training programme. The Sangh has its branches in the States and they are also managed by the State Branches in terms of the Bye-Laws. In order to show that it was an instrumentality of the State the petitioner had alleged that the respondent I Sangh had set up Leprosy Asylums at Delhi, Shahdara, which it was claimed was being run on behalf of the Government. This is denied in the counter affidavit where it is pointed out that the colony run by the Delhi branch at Shahdara was receiving Rs. 40.00 per head per month and the Branch used to put in another Rs. 45.00 per head. But the branch found it difficult to meet the rising cost of maintenance and the demands of patients the colony has since 1980 been handed over to Delhi Municipal Corporation. Mention was also made in the writ petition that the Sangh was running courses of para medical workers and gives scholarships to medical officers and specialists training in leprosy and that stipends to the trainees are also given as agreed upon with the Government of India by the Sangh. Though admitting in the return that Sangh is conducting various training courses for leprosy personnel it is denied that the trainees are mostly government candidates. As a matter of fact any candidate sponsored by the Leprosy institution can join the course. It was denied that there is any agreement with the Government of India or Unicef for paying stipends to trainees. It was pointed out. that though originally stipend of Rs. 100|- per month was paid as incentive to the trainees to do field work but the same has been stopped due to paucity of funds since 1980 and the trainees have been asked to seek facilities from the State Government. The Sangh has not carried out any research. Its purpose is to give relief on humanitarian ground and it is just one of the voluntary organisations in the country.
(8) Is the Sangh an authority or a State within Article 12 of the Constitution At one time it was assumed that a body cannot be a State unless it is created by a Statute. That fallacy has since been exploded. The test which is now commonly accepted is whether it is an instrumentality or agency of the Government and not as to how it is created. The inquiry has to be met as to now the juristic person is born but why it has been brought into existence. The Corporation may be a statutory Corporation created by a statute or it may be a Government company or a company formed under the Companies Act, 1956 or it may be a society registered under the Societies Registration Act, 1860 or any other similar statute. (Vide Ajay Hasia V. Khalid Mujib; : (1981)ILLJ103SC ) (1). In each case it would have to be decided on a consideration of the relevant factors whether the company or society is an instrumentality or an agency of the Government so as to come within the meaning of an authority under Article 12.
(9) Mr. Charya greatly stressed the fact that under the Rules and Regulations of the Sangh the President of India shall be the President of the Sangh, and that he bad also the power to nominate 5 members to the Governing Body. He also stressted that as a matter of fact the Minister of Health and the Director Health were associated with the Sangh and this showed that Sangh was an instrumentality of the State. Now the mere fact that the President of India is by the Rules of the Sangh to be the President of the Sangh does not mean that the Sangh would become an instrumentality of the State. A similar plea was raised but negatived in : (1975)ILLJ374SC Salbajit Tewary v. Union of India (2). In that case it was pleaded that the Council of Scientific and Industrial Research which is registered under the Societies Registration Act is an authority within Article 12 of the Constitution. The Rules of the Society made the Prime Minister of India as the ex-officio President of the Society. The Rules also empowered the Government to appoint nominees to the Governing Body representing the Administrative Ministries. The Government of India could also terminate the membership of any member at one and the same time of all members other than the ex-officio members of the Governing Body. Notwithstanding this the plea of the Society being a State was rejected and it was observed that 'the fact that the Prime Minister is the President or the Government appoints nominees to the Governing Body or that the Government may terminate the membership will not establish anything more than the fact that the Government takes special care that the promotion, guidance and co-operation of scientific and industrial research. ......... are carried out in a responsible manner'.
(10) In the present case the Governing Body is under no obligation even to seek approval of the Government to make amendment in Bye-Laws as was the case in Tewary's case (supra). Rule 28 authorises the Governing Body to alter repeal the Rules and Regulations. The reliance by Mr. Charya on : (1975)ILLJ399SC Sukhdev Singh V. Bhagat Ram (3), can be of no assistance because that was a case relating to three juristic bodies namely Oil and Natural Gas Commission, the Industrial Finance Corporation and the Life Insurance Corporation which were all created by a statute and that is why the Supreme Court held that they were authorities and thus 'State' within the meaning of Article 12. As to what is mentioned by the body acting as instrumentality or an agency of the Government was made clears in : (1979)IILLJ217SC Ramana V.I.A. Authority of lndia(4), wherein it was observed :----
'WEmay point out here that when we speak of a Corporation being an instrumentality of agency of Government, we do not mean to suggest that the Corporation should be an agent of the Government in the sense that whatever it does should be binding on the Government. It is not the relationship of principal and agent which is relevant and material but whether the Corporation is an instrumentality of the Government in the sense that a part of the governing power of the State is located in the Corporation and though the Corporation is acting on its own behalf and not on behalf of the Government, its action is really in the nature of State action.'
(11) The court then highlighted the various features of the International Airport Authority which was constituted by Parliament Act, namely (i) in the first place, the Chairman and members of the 1st respondent arc all persons nominated by the Central Government and the Central Government also has the power to terminate their appointment as also to remove them in certain specified circumstances ; (ii) the 1st respondent has no share capital but the capital needed by it for carrying out its functions is provided wholly by the Central Government ; (iii) so far as the functions of the 1st respondent are concerned, the entire department of the Central Government relating to the administration of airports and air navigation services together with its properties and assets, debts, obligations and liabilities, contracts, causes of action and pending litigation is transferred to the 1st respondent and the 1st respondent is charged with carrying out the same functions which were, until the appointed date, being carried out by the Central Government. It was because of these features that the Airport Authority was held to be an instrumentality or agency of the Central Government and a State within Article 12. The case : (1980)ILLJ222SC U. P. Warehousing Corpn. V. Vijay Narayan (5), is on the same lines as Sukhdev Singh's case because there M. P. Warehousing Corporation was constituted under the Madhya Pradesh Act and being a statutory body wholly controlled and managed by the Government its status was held to be that of an authority or a State and an employment therein a public employment with a statutory body. In Som Parkash V. Union of India (6), Bharat Petroleum Corportion was held to be a State because as observed by the Court the source of it was saturated with State functions and everything about the Corporation in the matter of employees' Provident Fund, Superannuation was regulated statutorily unlike in the case of ordinary companies. The provision for penalties if any person intermeddles with the property of the Corporation was held to be of a special character of this Government company. This case culled the test from the previous decisions especially from the International Airport Authority's and laid down that the preponderant consideration for pronouncing an entity as State agency or instrumentality are (i) financial resources of the State being the Chief funding source ; (ii) functional character being governmental in essence : (iii) plenary control residing in Government; (iv) prior history of the same activity having been carried on by Government and made over to the new body; and (v) some element of authority or command. These tests were again reiterates in : (1981)ILLJ103SC (Supra.) where though the society was registered under the Societies Registration Act it was held to be State. The considerations which weighed were that the Corporation of the Society is dominated by the representatives appointed by the Central Government and Government of Jammu and Kashmir, Punjab and Rajasthan with the approval of the Central Government. The money required for running the colleges were provided by the Central Government and the Government of Jammu and Kashmir. Other money could be received by the society only with the approval of the State and Central Government. The rules framed by the Society were to have prior approval of the State and Central Government. The Accounts of the Society were to be submitted to both the Government for the scrutiny and satisfaction. The society was also to comply with all such directions as may be issued by the State Government with the approval of the 'Central Government. The State and Central Government had even the power to appoint any person as a member of the Society and could also remove them from the Same. It was thus found that the Central and State Governments have full control of the working of the society and that is why it was held that the society was a State and authority within the meaning of Article 12 of the Constitution.
(12) Applying the tests above mentioned we find that the Sangh tails to graduate to the high status of an authority or a State within Article 12. As mentioned above out of a budget of 4 lakhs annually only Rs. 25,000|- are received from the Government for running of the publication. The Sangh is governed by its own Memorandum of Association and Rules. Rule 28 gives full power to the Governing Body to alter, vary or revoke at any time any rules and regulation thus empowering it to revoke even Rule I by which President of India shall be the President of the Sangh. Of course in practice it is unthinkable that any body or for the matter of that the Sangh would like to amend Rule I and thus disassociate itself from receiving guidance and patronage of the first citizen of the country ; but considered purely from the point of law there is no over all control and exercise of powers by the State. The action of the Governing Body to amend any rule or Bye-law is not subject to any approval prior or subsequent from the government. There is no power in the Central or the State Government to give any direction to the Sangh to function in any particular manner or to rernove any member of the Governing Body. The Constitution of the Governing Body as per Rule 3 shows that out of 40 members of the Sangh only 5 can be nominated by the President and the others are selected by various organisations. No authority or function of the government is vested in the Sangh.
(13) In the further rejoinder Mr. Charya had sought to refer to the fact that the Sangh was an association set up in 1929 and this was later on taken over by the Sangh and. thereforee, it must be held to be a State. The point was also raised that the seals were sold to collect funds and this also must be taken to be an act as an instrumentality of the State action. Annexure B-l annexed to the counter affidavit rather shows that the Sangh is a non-profit All India Voluntary Organisation and brings on a common platform various agencies, voluntary organisations, governmental, distinguished medical scientists and social workers. It has also 20 State Branches which have District and local branches. The main objective of the Sangh is the relief and control of leprosy. The Sangh is no doubt doing good work in giving training in educating people about the leprosy and removing misconceptions thereof. That this work which it it was not done by such voluntary organisations like the Sangh may have to be undertaken by the Government docs not mean that the voluntary organisations like the Sangh become an instrumentality of the State so as to come within Article 12. That such worthwhile bodies should receive aid and patronage from the government is not only understandable but also correct. But a small financial ai(i will not mean that all voluntary organisations doing good social work would by this little help be deemed to be instrumentality of the State. To so broadly hold would be to stifle voluntary initiative and individual participation in community work which is essential in any democratic set up like ours. That Government departments should be sympathetic to such voluntary bodies like Sangh which are engaged in the eradication of leprosy and aiding medically handicapped persons is understandable and laudable but unless the control exercised by the Government pervades the whole functions of the bodies to such an extent that in reality it can be said to be a link of the Government, it would not be a sound preposition to extend the arm of the State to voluntary organisations which may be the only answer to meet challenge of the unfortunate and serious problems of leprosy etc. Apart from pointing out that the President of India is the President of the Sangh and that some small funds are given to the Society no other incursion of the State aid or State involvement is shown in the Sangh. The mere fact that various government officers including the Ministers are associated with voluntary agencies is not per se destructive of the bodies remaining voluntary associations. To be in a hurry to close this gap which is subtantial between a State body and a voluntary association will not be conducive to evolving a spirit of self initiative and self help which must be helped to be generated if the vast problem facing the country are to be met. In all countries State help is always supplementary to citizens self help bodies like the voluntary organisations like the Sangh. Unless there are convincing reasons to the contrary, of which we find none it would be untenable to designate the bodies like the Sangh as a State within Article 12 of the Constitution.
(14) Reference by Mr. Charya to Section 3 of Lepers Act. 1898 is inapposite because there is no notification designating any Homes which are being run by the Sangh as Leper Asylums. Section 5 provides for the constitution of a Board by the State Government for every Leper Asylum appointed under Section 3. It is no body's case that the Governing Body of the Sangh has been formed under Section 3 or 5 of the Lepers Act. Mr. Charya rather concedes that the Governing Body is formed under the Rules and Regulations of the Sangh. This fact itself would negative any argument of Mr. Charya that the Sangh is running any Leper Asylum.
(15) We are thus of the view that the Sangh is not an authority of State within Article 12 of the Constitution and thereforee, is not amenable to the writ jurisdiction under Aricle 226. The result is that we upholdthe order of the learned single Judge and dismiss the appeal. But in the circumstances of the case there will be no order as to costs.