S.S. Chadha, J.
(1) This batch of writ petitions under Article 226 of the Constitution of India challenge certain decisions made by the Army Welfare Housing Organisation. Director General of Army Welfare Housing Organisation and Adjutant General, Army Headquarters who is the Chairman of Army Welfare Housing Organisation. Chief of the Army Staff and Union of India have also been imp leaded as respondents. The allegations are that they have violated the provisions of the Memorandum, Rules and Regulations of the organization as well as bye-laws contained in the Master Brochure, 1979.
(2) A preliminary objection is raised by Mr. K.S. Bindra, the learned counsel on behalf of the respondents about the maintainability of the writ petitions. The respondents contend that Army Welfare Housing Organisation (for short WHO) is a welfare organisation registered under the Societies Act, Xxi of 1860 having its head office at Kashmir House, Army Headquarters, New Delhi. who being a voluntary organisation, its affairs are managed by. Board of Management of which the members are mostly nominated in the ex-officio capacity and hold their respective positions on account of their appointments and thus there is no State control at all. The general rules and regulations and the procedure to be followed and adopted by who is laid down in the Memorandum and Articles of Association of who and the Master Brochure published from time to time in the form of the supplementary rules. There is no share capital or any share holding by any of the members. The sole function of the society is to promote housing scheme as a welfare measure and thus no governmental function is involved. The contention is that who is not an authority within the meaning of article 12 of the Constitution and no writ can be maintained against it nor can any complaint be made that it has acted arbitrarily in the matter of enrolment of members, eligibility under long term scheme or short term scheme or of granting priorities of allotments under the scheme.
(3) In order to appreciate this objection, it is necessary to go into the creation of WHO. A copy of the application from for registration of societies has been filed on the. record. It contains the Memorandum and Articles of Association of the Society. The name of the society is -Army Welfare Housing Organisation. The registered office of who is to remain within the territory of Delhi and at that time it was in Room Nos. 208, 209 and 211, 2nd Floor, South Block, Adjutant General's Branch, Army Headquarters, New Delhi. The Memorandum of Association in Clause 3 sets out the objects. The aims and objects of who are (a) to promote Housing Scheme as welfare measures in the Army/Ex-servicemen to provide cheap houses to them at places of their choice in India and to start pilot project in Delhi and its satellite town immediately; (b) to facilitate relief to the existing deficiencies of Government accommodation at various stations in the country and to provide suitable rehabilitation opportunities in the said category; (c) to offer accommodation at no profit/no loss basis, and (d) all the activities of the who as mentioned above- from (a) to (c) are to be carried out without any profit nature. The income and property of the society whenever derived has to be applied solely towards the promotion of the objects of the association setforth in the Memorandum of Association and no proportion by way of dividend or bonus or objects of the association set-forth in the Memorandum of have been members of who or to any of them or to any person claiming through them. Under Clause 4 the names and addresses, occupations and designation of the founding members of the Board of Management to whom management and affairs of who are contemplated to be entrusted as required under Section 2 of the Societies Registration Act, 1860 as extended to the Union Territory of Delhi are stated. They are with respective names viz. Adjutant General as Chairman, Deputy Adjutant as Vice-Chairman, Director of Personal Service, Director General of Works, Director Army Group Insurance and Director of Quartering as four members besides Director, Army Welfare Housing Organisation as the seventh member. Deputy Director, Army Welfare Housing Organisation is the Deputy Director-cum-Secretary in the Organisation. Their occupation is given as Military Service. The Memorandum of the society is signed by the aforesaid eight serving officers.
(4) The Rules and Regulations of who were enclosed with the Memorandum of the society. Under Rule 4 it is stated that who will be located in Delhi as part of Adjutant General's blanch. Its outline Board of Management is the same eight officers who have subscribed to the Memorandum of the society. The Station Committees are to be set up to perform the implementation of the project at local level by the Board of Management. The Station Committee are the principal agencies responsible to the Director, who and they function in accordance with the adopted constitutions of WHO. All serving personnel on the Board of Management are the ex-office members of the society. Some retired servicemen/ civilians can be employed on the approval of the Adjutant General at Prescribed conditions of service and at scale already existing for such employees of Adjutant General's Branch. Their expenses are paid from the funds which are raised during the course of the business of the society. Under Rules 6 and 7, the developments of housing projects and the salient features of the scheme are then detailed. As a major solution to the development of the scheme initially, it is proposed to orientate the scheme as self-help through voluntary offer of services during leave /spare time for supervision, managerial or other technical nature of works.
(5) The financing of the schemes is laid down in Rules 9 to 12. In addition to the personal savings that can be affected by the army personnel including DSOP/FPP funds, suitable financial arrangements can be made through the following organisations : -
(A)Life Insurance Corporation (gives loan up to Rs. 1,00,0001- to individuals and also collective loans to societies); (b) Nationalised commercial banks; (c) Hindustan Urban Development Corporation (HUDCO); (d) Loan from Central Government (Rs. 70,0001- maximum for an officer).
The Organisation offers to examine any other suitable measures to mobilize funds for effecting economy in financing the projects. For the initial stage, certain pre-operative expenses such as legal and technical consultation services, advance for purchases of land and other administrative expenses had to be incurred. For this purpose a sum of Rs. 5 lacs was advanced as loan from welfare funds at the disposal of Army Headquarters. A revolving fund is also proposed to be created by subscriptions, donations and percentage charge on each project completed.
(6) The funds of the who are administered by a Board of Management as provided by Rule 16. The rule specifies the names of eight officers who would be its first ex-officio members. The Adjutant General is the Chairman. The Deputy Adjutant General is the Vice-Chairman. Director of personal Services, Director General of Works, Director of Army Group Insurance and Director of Quartering are four members. Besides, Director, Army Welfare Housing. Organisation and Deputy Director, Army Welfare Housing Organisation are two other members with appointments' as Director and Deputy Director respectively. To assist the Board of Management in carrying out the day-to-day business a committee known as Executive Committee composed of Chairman, Deputy .Adjutant General; Vice-Chairman, Director, who and Secretary, Deputy Director, who is also formed. Provisions have been made in Rule 18 regarding the members of the Board of Management and the Executive Committee. Where a persor, becomes a member of the Board of Management/Executive Committee by reason of the officer or an appointment he holds, his membership terminates upon he ceases to hold 'that officer or appointment. A member also ceases to be sack member, if he shall die, resign, become of unsound mind, become involved or convicted of a criminal offence involving moral turpitude or is removed by the Central Government or is transferred from Army Headquarters.
(7) Under Rule 19 subject to any general or special directions given by the Central Government, the general management of the organisation vests in and rests with the Board of Management. The Executive Committee can function notwithstanding that any person who is entitled to be a member by reason of his office is not a member for the time being and notwithstanding any other vacancy in the Executive Committee and no act or proceedings of it can be invalidated merely by reason of the happening or any of the above events or of any defects in the appointment. Under Rule 23, provisions have also been made for dissolution of the society and adjustment of its affairs. The consent of Government for dissolution of the society is required. Upon the dissolution of the society, no member is to receive any profits and it is to be given to some other society.
(8) In pursuance of the Memorandum, Rules and Regulations of who, a housing scheme has been formulated and circulated in the form of Master Brochure in March, 1979 with amendments from time to time. The salient features are these. who undertakes to promote suitable housing schemes for serving) retired Army personnel, on all India basis, at No Profit No Loss basis. It has broadly been charged with the functions Viz. (a) to lay down general policies on Army Welfare Housing Schemes, (b) to liaise with the concerned Ministries at the Centre and States to ascertain details of the various housing schemes being promoted in different States of India with a view to determining suitable schemes winch could benefit Army personnel, (c) to examine, coordinate, approve and progress various schemes for construction and acquisition of house/colonies and (d) to do all such thinks as ate incidental of conducive to the attainment of the above objectives. who is the central body responsible for promoting housing schemes under its own care and arrangements or acquire for its members houses wider the schemes already in operation in public sector, i.e. Government of Quasi Government agencies under the control of either the Central Of State Governments. The housing projects are requited to be evaluated both in terms of their contribution to their facilitating relief to the existing deficiencies of Government accommodation at various stations and providing suitable rehabilitation opportunities to Army personnel. General membership and eligibility conditions are then prescribed. The membership is voluntary and restricted, for the time being, to (a) all tanks of Regular Army who are/were on effective strength of the Army on or before 15th January 1978; (b) fix-servicemen (Army Personnel) who have served in any rank in the Army as regular combatant or non-combatant for not less than six months after attestation except those removed from Army for disciplinary reasons; and (c) widows/widowers/legal guardians of children of Army personnel whose spouses died while in Service, on fit after 15th January 1978. The members can contribute to one of the schemes i.e. Long Term Scheme 'Rakshavas Yojna' and Short Term Schemes, the details of which are given in the brochure. The' membership and eligibility conditions, applications for membership, channel of submission, acceptance of membership, seniority of member, system of fixing group seniority, allotment of house/flats, handing over of possession, Withdrawals, penalties, inter-group transfers etc. are provided in the brochure.
(9) The objections of the respondents based oft the construction and interpretation of the Rules and Regulations is that who is not amenable to writ jurisdiction under Article 226 of the Constitution as it is neither a State nor an authority within the meaning of the term as used in Article 226. Mr. K. S. Bindra, has relied upon ''Ramana Dayaram Shettey V. International Airport Authority of lndia', : (1979)IILLJ217SC , 'Ajay Hasia etc. V. Khalid Mujib etc.' : (1981)ILLJ103SC and 'Chakradhar V. Sammansingha Service Co-op. Society Ltd.', AIR 1982 Ori 82 In reply, Shri N. N. Gupta, the learned counsel for five writ petitioners has construed the Memorandum of Association and the Rules in his favor and placed reliance on 'Sabhajit Tewary V. Union of India' : (1975)ILLJ374SC , 'S.S. Minhas V. Indian Standards Institution' : (1984)ILLJ67SC (5), 'P.-K. Ramchandra Iyer V. Union of India'. : (1984)ILLJ314SC and Ramana Shetty's case (supra), Shri P. P.. Malhotra, learned counsel for one of the writ petitioners and Shri P. C. Khanna, Advocate for one of the writ petitioners invoked the criteria devised by the judicial dicta in 'Rammana Shetty's case (supra) and 'Ajay Hasia's case (supra) to urge that who is the instrumentality and agency of the Government.
(10) who is a society which is not a Corporation created by a statute but is a society registered under the Societies Act. Act Xxi of 1960, as extended to the Union Territory of Delhi. It is immaterial whether the authority is created by a statute or under a statute. The law is now settled. In 'U. P. Warehousing Corporation V. Vijay Narain' : (1980)ILLJ222SC , Chinappa Reddy, J. found it very hard in deed to discover any distinction on principle between a person directly under the employment of the Government and a person under the employment of an agency or an instrumentality of a Government or a Corporation set up under a statute or incorporated but wholly owned by the Government. In Ajay Hasia's case (supra), Bhakwati J. who spoke for the Supreme Court, held :--
''.....THEcorporation maybe 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. Whatever be its genetically origin, it would be an 'authority' within the meaning of Article 12 if it is an instrumentality or agency of the Government and that would have to be decided on a proper assessment of the facts in the light of the relevant factors. The concept of instrumentality or agency of the Government is not limited to a corporation created by a statute but is equally applicable to a company or society and in a given case it would have to be decided, on a consideration of the relevant factors, whether the company or society is an instrumentality or agency of .the Government so as to come within the meaning of the expression 'authority' in Article 12.'
(11) The tests for determining as .to when a society can be said to be instrumentality or agency of the Government have been laid down in 'Sukhdev Singh V. Bhagat Ram' : (1975)ILLJ399SC , 'The International Airport Authority's case : (1979)IILLJ217SC and in Ajay Hasia's case : (1981)ILLJ103SC . The relevant tests gathered from the decision in the International Airport Authority's case are reiterated in Ajay Hasia's case in these words :
(1)'One thing is clear that if the entire share capital of the corporation is held by Government it would go a long way towards indicating that the corporation is an instrumentality or agency of Government.'
(2)'Where the financial assistance of the State is so much as to meet. almost entire expenditure of the corporation, it would afford some indication of the corporation being impregnated with governmental character.'
(3)'It may also be a relevant factor, ....whether the corporation enjoys .monopoly status which is the State conferred or State protested.'
(4)'Existence of 'deep and pervasive State control may afford an indication that the Corporation is a State agency or instrumentality.'
(5)'If the functions of the corporation of public importance' and closely related to governmental functions, it would be a relevant factor in classifying the corporation us on instrumentality or agency of Government.'
(6)'Specifically, if a department of GOVT. is transferred to a corporation it would be a strong factor supportive of this inference of the Corporation Being an instrumentality or agency of Government.'
(12) It was pointed out that if on a consideration of these relevant factors. It is found that the Corporation is an instrumentality or agency of Government, it would be an authority' and, thereforee, a 'State' within the meaning of the expression under Article 12. At the outset I may state that I am not examining Serialtim each of the factors which the counsel for the parties have urged for claiming or negativing who to be an instrumentality or agency of the State. I am discussing them with a view to find out their aggregate and cumulative effect. As pointed out by their Lordships in Ajay Hasia's case, these tests are not conclusive or clinching but they are merely indicative indicia which have to be used with care and caution because while stressing the necessity of a wide meaning to be placed on the expression 'other authorities', if must be realised that it should not be stretched so far as to bring in every autonomous body which has some nexus with Government. A wide enlargement of the meaning must be tempered by a wise limitation.
(13) who is welfare organisation registered under the Societies Act, Act Xxi of 1860 with no share capital It has no shares of share-holders. who is the central body responsible for promoting housing schemes under its own care and arrangement or acquire for its members houses under the schemes already in operation under public sector i.e. Government or quasi-Government agencies tinder the control of Central or Slate Governments . The membership of the schemes is voluntary and restricted to all ranks of regular army/ex-servicemen/ widows/legal guardians of children of army personnel. The members can contribute to one of the Schemes i.e. long term scheme or short term scheme. The persons who enroll themselves as member of any scheme do not become the shareholders of WHO. The members are only beneficfarios of the housing schemes.
(14) There is no State financial assistance to who as would transform the welfare activity of promoting housing schemes for the .army /ex-servicemen in State action. The provisions relating to financing of the schemes are contained in Rules 9 to 12 of the Rules and Regulations of WHO. For the purpose of certain preoperative expenses, a sum of Rs. 5 lacs had been advanced as loan from welfare funds at the disposal of Army Headquarters and this amount has been repaid. There is no extensive Governmental support or unusual financial assistance given by the Government. It is only a loan of Rs.5 lacs from a welfare fund. The funds of who are created by the society itself . . Suitable. financial arrangements for the participants of the schemes are made from various agencies including Life Insurances Corporation of India, Nationalised commercial banks. Hindustan Urban Development Corporation and loan from Central Government. No instrumentality of the Government is involved in making suitable financial arrangement from the aforesaid four organisations. A private agency or an individual can take financial assistance from the aforesaid first three organisations and any Government servant, if otherwise eligible, can take loan from the Central Government. In the financing of the individuals under the schemes, there is no involvement of the State as such.
(15) It is clear from the Memorandum, Rules and Regulations of who that the Government does not appoint or nominate the Board of Management or the Executive Committee. The Board of Management as well as the Executive Committee to whom the management and affairs of who are entrusted, are controlled itself by the. provisions of the rules of WHO. An officer becomes an ex-officio member of the Board of Management or Executive Committee by reason of the office or appointment' he holds. No specific appointment is required or is made by the Government. The affairs of who are controlled, administered and managed by the Board of Management and the Executive Committee without any supervening authority of the Central Government. The membership of the Board of Management of Executive Committee terminates upon when an officer ceases to hold that office or appointment and there is an automatic appointment of another officer ex-officio who holds that office or appointment. This relates to the six members of the Board. The Director, Army Welfare Housing Organisation and Deputy Director may be a serving officer or a retired officer. The appointment of Director and Deputy Director and other staff is by the Board of Management and payment of their salaries and other allowances is by' WHO. Those officers are not paid from the consolidated fund of the Government of India but are paid from the funds of WHO.
(16) That takes me to the consideration of the question of the functions of WHO. We, the People of India, having solemnly resolved to constitute India into a Sovereign Socialist Secular Democratic Republic and have undertaken to secure all the citizen justice, social, economic and political etc. The social, political and economic objectives are not defined as such or amplified in the Constitution but there are clear indications of the welfare State in the Directive Principles of the State Policy contained in Articles 38 and 39 of the Constitution. The provisions contained in Part Iv of the Constitution may not be enforceable by any Court, but' the principles laid down are nevertheless fundamentals in the governance of the country and it is made the obligatory duty of the State to apply these principles in making laws. Article 38 provides that the State shall strive to promote the welfare of the people by securing and protecting as effectively as it may a social order in which justice, social, economic and political shall inform all the institutions of the national life. It further enjoins upon the various States to initiate policies calculated to minimise the inequalities in income and endeavor to eliminate inequalities in status, facilities and opportunities.
(17) Having laid the principles broadly in Article 38, Article 39 particularises certain principles of policy to be followed by the State. It provides that the State shall direct its policy towards securing that the citizens have the right to an adequate means of livelihood; that the ownership and control of the material resources of the country are so distributed as to best subserve the common good; that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment; that there is equal pay for equal work for both men and women; that the State shall endeavor that the health and strength of workers and the tender age of the children are not abused and that the childhood and youth are protected against exploitation and against moral and material abandonment. Article 41 directs the State, within the limits of its economic capacity and development to make effective provision for securing the right to work, to education and public assistance in cases of unemployment, old age, sickness and disablement, arid in other cages of undeserved want. Article 43 enjoins upon the State to endeavor to secure to all workers a living wage and .decent conditions of work. Article 47 imposes a duty on the State to raise level of nutrition and the standard of living and improve public health. These and other directives arc designed to bring about a Welfare State.
(18) The State is concerned with the welfare of the people. With the growth of the Welfare State it is not possible to define What functions are governmental and what are not. The question before me is whether the construction of individual housing accommodation on no profit no loss basis for citizen or for that matter for the Army or ex-army personnel is a governmental function. The counsel for the parties have not brought to my notice any provisions in the Constitution or any policy resolution of the Government by which the State has undertaken to provide houses for all the citizen, I may, however, take judicial notice of certain statutory provisions or facts. The State has from time to time acquired lands for public purposes of development and disposal for allotment to displaced persons as relief, rehabilitation or resettlement measure. Schemes have also been formulated for provision of tenements for scheduled castes and other backward classes. State has formulated, announced and implemented policies of Planned Development of Cities by acquiring, developing and then disposing of lands to citizens to enable them to construct houses either themselves or in groups by the cooperative societies. The Housing and Urban Development Corporation has been participating in the housing .schemes executed by the various housing boards of other agencies under it in encouraging low-cost constructions. It has, however, restricted its activities to urban centres and directed it to the housing of economically weaker sections and low income groups. There is a proposal of floating of a Rural Housing Subsidiary Corporation, but that will only try to. identify the problem of rural housing and endeavor to channels new rural sources of funding. Hudco also proposes to set up a Human Settlement Management Institute to undertake training in financial and management and the social and economic dimension of housing. It may also be entrusted with the task of undertaking all kinds of research relating to housing and to provide consultancy services.
(19) The legislature has enacted Development Acts to promote and secure the development of the urban areas according to plan. Powers have been conferred to acquire, hold, manage and dispose of land and other property. Power have also been conferred to carry out building, engineering and mining and other operations. Power is thus conferred on the Authority constituted under the Act to build Housing Estelle/Dwelling Units/Fiats and dispose of the properties by way of sale or hire purchase. But this is in the nature of a commercial activity sanctioned by the statute. The statutory provisions contained in the Municipal Acts have provided for the owner's obligations when dealing with the land as building sites, to submit layout plans for sanction. The buildings are required to be constructed conforming to lay down standards as to the built-up area depending upon the density of the population, set backs, health and hygiene of the user of the building. There are statutory provisions providing for the inspection and demolition of houses unfit for human habitation and/or dangerous building or compulsory repairs of houses capable of being made fit at' reasonable expense contained in the Municipal Acts'and Bye-laws. There are also Slum clearance Acts to provide for the clearance of areas unfit for human habitation. From all this it seems to me that the Government's objective is to afford help, create conditions, encourage real estate development and discharge a major social responsibility. The State has, however, not undertaken as its public function to provide new housing/flats/tenements for the Army or ex-Army personnel. Not even to a limited extern on the lines of Housing Act, 1957 in England.
(20) As observed by K. K. Mathew, J. in Sukhdev Singh's case (supra) activities which are too fundamental to the society ar by definition too important not to be considered by government function. This demands the delineation of a theory which retires the Government to provide all persons with all fundamentals of life and the determinations of the aspects which are fundamental. The State today has an affirmative duty of seeing that all essentials of life are made available to all persons. The task of the State is to make possible the achievement of good life both by removing obstacles in the path of such achievements and in assisting individual in Realizing his ideal of self-perfection. But a caution was given by Mathew, J. by using the words of Justice Holmes in 'Tyson & Brother V. Banton' (1926) 273 U.S. 418 that if we are to yield to fashionable conventions, it seems that theaters are as much devoted to public use 'as anything well can be. To many people the superfluous is the necessary and it seems that the Government Joes not go beyond its sphere in attempting to make life livable for then. Earlier in the Judgment reference was made to 'Doisey V. Stuwesant Town Corporation', 299 Ny 512relating to the problem raised by the discriminatory action by a private agency receiving State financial 'aid. Pursuant to New Yorks redevelopment laws, the Metropolitan Life Insurance Company organized a redevelopment Corporation to participate in a plan to construct housing. The majority of the New York Court of Appeals found no exertion of State power 'directly in .lid of discrimination and decided that the private company was not engaged in a governmental function. In our country, the common man's crying and in 'act fundamental need is for a livable and comfortable house. I wish it was a governmental function to provide one.
(21) As noticed above, the object of who is predominantly and chiefly to provide dwelling units to the serving and retired Army Personnel on All India basis at no profit no loss basis. Real Estate builders, co-operative house building societies. Group Housing Societies, public and private limited construction companies, individual builders etc. are all engaged in the construction activity of building residential housea) flats. There is no monopoly status or State protected activity.
(22) In my opinion, the financial resources of the State are not the funding source of the WHO. who can neither be regarded as a society discharging a function which is a public function in nature nor if 1s impregnated with governmental character or tied or entwined with Government. There is no department of Government handling the schemes or building of houses turn and on behalf of all citizens or Army Personnel on no profit or no loss basis and thus no occasion to transfer such department to WHO. There is hardly any disciplinary control residing in the Government over who except six serving officers of the Adjutant General being ex officio members of the organisation. The general Governmental supervision under Rule 17 does not show 'deep and pervasive State control'. The cumulative effect of these factors persuades me to hold that who cannot be regarded as an instrumentality or agency of the Government and so an authority within the meaning of the term In Article 226 of the Constitution. The result is that the first preliminary objection prevails.
(23) I may notice without determining two other preliminary objections raised by Shri K. S. Bindra. The second objection is that it was a case of simple contract between who and writ petitioners who enrolled themselves as members of the scheme under the Rules, Regulations and the Bye-laws which are non-statutory. The petitioners seek the enforcement of the liabilities arising out of mutually agreed conditions of the bye-laws and this is not permissible, says the counsel, in proceedings under Article 226. Reliance is placed on 'Hari Shanker V. Deputy Excise & Taxation Commissioner' : 3SCR254 ; 'Radha Krishna Agarwal V. State of Bihar' : 3SCR249 ; 'State of Punjab V. Balbir Singh', and 'Bihar B.G.P. Co-op. Society v. Sipahi Singh' : 1SCR375 . The third objection is that Supply Rule No. 2 provides that all matters of disputes, differences etc. of the members viz-a-viz the organisation shall be referred to the Chairman who shall appoint an arbitrator to adjudicate in the matter, whose decision shall be final and binding on the members as well as the organisation. It is urged that the High Court should not' exercise its extraordinary jurisdiction when there 's a complete efficacious alternative remedy available. Reliance is placed on 'Bisra Stone Lime Co. V.O.S.E. Board' : 2SCR307 and 'Asstt. Collector C.E. Chandan Nagar v.Dunlop India Ltd.' : 1985ECR4(SC) .
(24) The result is that in regard to grievances of the alleged arbitrary or illegal decisions of who in the matter of enrolment of members, eligibility under long-term scheme or shortterm scheme or of granting of priorities of allotments under the scheme, the jurisdiction of this Court under Article 226 of the Constitution cannot be. invoked. who is not amenable to writ jurisdiction under Article 226 as it is neither a State nor an authority within the meaning of the term used in Article 226. The writ petitions are hereby dismissed with no order as to costs.