STATES

Part III of the Constitution of India guarantees certain fundamental rights to the citizens of
India as well as other persons residing in India. These fundamental rights are guaranteed only
against State action. In other words, the State cannot act contrary to the fundamental rights
and cannot by its action legislative or otherwise curtail or take away the fundamental rights.
Every person aggrieved by curtailment or encroachment of the fundamental rights is entitled
to approach the Supreme Court under Article 32 or the High Court under Article 226 of the
Constitution of India.

If the rights of a citizen are interfered with by any other person it only amounts to violation of
his/her civil rights and he/she can approach ordinary Civil Courts or Criminal Courts
constituted by the State for relief. Therefore, Article 12 of the Constitution of India defines
the word State for purposes of Part III of the Constitution of India, which reads as follows:

Definition:
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.

The Constitution of India is the sovereign law of the land. It promises Justice, Liberty and
Equality to the people of India. For this, the Constitution carries the basic notion of Rule of
Law i.e. limited Government, and provides the structure, procedures, powers, and duties of
Government institutions, and sets out Fundamental Rights, Directive Principles, and the
duties of citizens.

The whole constitutional scheme prohibits all of the three organs of State i.e. Legislature,
Executive and Judiciary, from acting against the spirit of the Constitution of India. The
Constitution of India prohibits the State from interfering with the individuals fundamental
rights. The State cannot act arbitrarily, irrationally, and unfairly.

The State cannot impose unreasonable restrictions on an individuals fundamental freedoms.

In order to limit someone’s right to life and personal liberty, the State has to adopt just, fair,
and reasonable procedure. However, all such constitutional remedies are available against the
States action only. In other words, the fundamental rights can be enforced against the State
only. An individual cannot enforce his fundamental right against a private individual.

Whereas, the present age is of an inevitable privatization & globalization, and has brought
infinite private bodies or entities performing functions of public importance. The limited
enforcement of Fundamental Rights involves serious implications, and asks what would
happen if private entities or non-state actors violate individuals Fundamental Rights.

Therefore, the Fundamental Right conferred by Part III is an injunction both to the legislative
as well as executive organs of the State and to other subordinate authorities.

Most of the Fundamental Rights are claimed against the State and its instrumentalities and
not against private bodies. Article 13 (2) of Constitution of India bars the State from making
any laws infringing any Fundamental Rights. Article 124 of Constitution of India gives an
extended significance to the term State. Article 12 clarifies that the term State occurring in
Article 13 (2) of Constitution of India or any other provision concerning Fundamental Rights,
has an expansive meaning.

Meaning of State under Article 12 of the Constitution of India

Since India is a modern Welfare State, its functions have been increased over the period of
time. The Indian State has to draft and implement welfare policies and schemes. Furthermore,
the Government needs the assistance of different departments, agents, and private bodies or
individuals, for performing essential public functions. However, the State cannot escape from
their responsibility to protect individuals fundamental rights.

Currently, many private bodies and individuals engage in various commercial & non-
commercial activities and perform numerous functions of public importance affecting
individuals fundamental rights. But due to lack of broadest meaning of State, an individual
could not enforce his or her fundamental rights against these private or non-state actors.

In the Indian Constitutional Scheme almost all of the fundamental rights are available against
the State. Article 12 of the Constitution of India defines State to include the Government &
Parliament of India, the Government & the Legislature of each of the States, all local
authorities, and other authorities within the territory of India or under the control of the
Government of India. The most problematic expression under Article 12 of Constitution of
India is other authorities as this expression is not defined in the Constitution of India. Thus it
is for the Courts to interpret this term, and it is clear that the wider this term is interpreted, the
wider the ambit of fundamental rights would be.

Judicial Dictum
In [University of Madras Vs Shanta Bai & Anr, AIR 1954 Mad. 67] the Madras High Court
evolved the principle of ejusdem generis which meant only authorities that perform
Governmental or sovereign functions can be included under Article 12 of Constitution of
India. The Supreme Court of India interpreted the definition of State in a very restricted
sense. The Supreme Court treated the definition as exhaustive one, and confined to the
authorities or those which are of like nature.

In [Rajasthan Electricity Board Vs Mohan Lal & Ors, AIR 1967 SC 1857] the Supreme Court
held that other authorities included those authorities which had been created by the
Constitution or under any statute and, on whom powers had been conferred upon by law. And
it is immaterial that some of the powers conferred on the authority may be for the purpose of
carrying on commercial activities while deciding the status of the authority under Article 12
of the Constitution.

In [Sukdev Singh & Ors. Vs Bhagat Ram & Anr., AIR 1975 SC 1331] the Supreme Court
discussed the status of statutory corporations like ONGC, IFC and LIC. The Supreme Court
held that all of these Corporations were the State under Article 12 of the Constitution of India
because these corporations were created by statutes, had the statutory power to make binding
rules and regulations, and were subject to pervasive Government control.

Mathew J in his concurring judgment went further. He said that a state acts through the
instrumentality or agency of natural or juridical persons. It means that if an action has been
done by a States instrumentality or agency, then it would amount to State action. In order to
find out whether an entity is a States agency or instrumentality, he gave following
determining factors

Whether the State has financial and administrative control over the management and policies
of the agency
Whether the entity or instrumentality or agency is performing an essential public function?
Whether the entity or agency is carrying out business for the benefit of public or not?

Justice Mathew's concurring opinion became a guiding factor for the future judges to
determine whether an entity is a States agency or instrumentality or not.
In the case of [R. D. Shetty Vs International Airport Authority & Ors., 1979 SCR (3) 1014]
the Supreme Court laid down five tests to be considered other authority, which are as follows:

Entire share capital is owned or managed by State

Enjoys monopoly status.
Department of Government is transferred to Corporation.
Functional character governmental in essence.
Deep and pervasive State control.
Object of Authority.

In [Ajay Hasia Vs Khalid Mujib & Ors., AIR 1981 SC 487] a Regional Engineering College
was under the Governments financial & administrative control. The Supreme Court held that
the College was an authority for the purposes of Article 12 of Constitution of India.

The Supreme Court laid down the following tests to determine whether a body is an
instrumentality of the Government or not:

If the entire share capital of the Corporation is held by the Government

Where the financial assistance of the State is so much as to meet almost entire expenditure of
the Corporation.
Whether the Corporation enjoys monopoly status, which is State conferred or State
protected?
Existence of deep and pervasive State control
If the functions of the Corporation are of public importance?
If a department of Government is transferred to Corporation?

However, these tests are not conclusive and exhaustive. These are inclusive in nature.

With regard to private entities, the Supreme Court widened the meaning of State action. In
[M. C. Mehta & Anr. Vs Sri Ram Fertilizers Ltd. & Ors., 1987 SCR 819] the Supreme Court
stressed that the ambit of Article 12 of Constitution of India should be enlarged in order to
bring private companies under the strict scrutiny of fundamental rights.

Furthermore, in the case of [J. P. Unni Krishnan & Ors. Vs State of A. P & Ors., (1993) 1
SCC 645] the Supreme Court held that private educational institutions cannot be allowed to
violate Article 14 of Constitution of India as they are performing a public function of
imparting education. It is very important for the Judiciary to enlarge the scope of Article 12
of Constitution of India for essential public function like education.

In [Pradeep Kumar Biswas Vs Indian Institute of Chemical Biology & Ors., (2002) 5 SCC
111] the Supreme Court said that the tests formulated in Ajay Hasia are not a rigid set of
principles. The Supreme Court held that cumulative effective of all the tests will be
considered to find out whether the body is financially, functionally and administratively
dominated by or under the control of the Government.

In the case of [Zee Telefilms Ltd. & Anr. Vs Union of India & Ors., (2005) 4 SCC 649],
deliberating upon the term other authorities as appearing in Article 12 of the Constitution of
India, the Apex Court held that, the following bodies (or authorities) shall fall under the aegis
of the term other authorities, as appearing in Article 12 of the Constitution of India:
Corporations & Societies created by the State for carrying out trading activities, in terms of
Article 298 of the Constitution of India, where the capital, infrastructure, initial investment &
financial aid is provided by the State (and the State exercises the necessary regulation &
control thereof);
Bodies created for, or otherwise carrying out, works in the nature of research and
development, which are, broadly speaking, in periphery of governmental functions?, but may
or may not be in the domain of sovereign functions;
A private body discharging a public duty or a positive obligation of public nature, and is
carrying out activities which are otherwise in the nature of the job of the Government.

The Supreme Court further held that, in case of hybrid bodies, the relevant factors qua the
determination of State, shall be the following:
When a body acts as a public authority, and has a public duty to perform
When it is duty-bound to protect the human rights;
When it monitors a profession (or vocation) qua the citizens, which otherwise is a
fundamental right

In [Lt. Governor of Delhi & Ors. Vs V. K. Sodhi & Ors., AIR 2007 SC 2885] the issue of
whether State Council of Education, Research & Training (SCERT) is a State within the
meaning of Article 12 of the Constitution of India or not, was raised. The Supreme Court
found no governmental interference or control either financially, functionally or
administratively, in the working of the Council.

A legislation of 1989 was enacted for promoting industries in the State of Assam including
small scale industries. The 1989 Act constituted a Board for the purpose of monitoring
supplies to various departments. The Managing Director of the Corporation was a member of
the Board in terms of the provisions of the 1989 Act. Analyzing the whole functioning of the
Corporation, the Supreme Court in [Assam Small Scale Ind. Dev. Corporation & Ors. Vs J.
D. Pharmaceuticals & Anr., AIR 2006 SC 131] held that it was a statutory body and was a
State? within the meaning of Article 12 of the Constitution of India. The contract by and
between the parties being a statutory one, the Corporation was required to act fairly and
reasonably.
However, the above said statutory bodies, corporations, government companies or public
sector undertakings are not State? within the meaning of Article 131 of Constitution of India.
It has been settled through various decisions that this Article will not be applicable where
citizens or private bodies are parties either jointly or in the alternative with the State or the
Government of India.

In [Tashi Delek Gaming Solutions Ltd. & Anr. Vs State of Karnataka & Ors., AIR 2006 SC
661 the Supreme Court held that the enlarged definition of State under Article 12 of
Constitution of India would not extend to Article 131 of the Constitution of India. The
Supreme Court says that it is also not in dispute that even a statutory corporation is not a
State within the meaning of the said provision. The Courts in India continuously says that
instrumentalities of State are different from State Government, though both may answer the
definition of State under Article 12 of Constitution of India for the limited purpose of Part-III
of the Constitution of India.

The Supreme Court in [Srikant Vs Vasantrao & Ors., AIR 2006 SC 918] said that the very
inclusive definition of State under Article 12 by referring to Government of India, the
Government of each of the States and the local and other authorities, made it clear that a State
Government and a local or other authorities, are different and that they fall under a common
definition only for the purpose of Part-III of the Constitution of India.

The Court refused to apply the enlarged definition of State given in Part - III (and Part - IV)
of the Constitution of India, for interpreting the words State or State Government occurring in
other parts of the Constitution of India. The Supreme Court continued to say that while the
term State may include a State Government as also statutory or other authorities for the
purposes of Part - III (or Part - IV) of the Constitution of India, the term State Government in
its ordinary sense does not encompass in its fold either a local or statutory authority.
Considering these findings, the Supreme Court held that the Corporation or other States
instrumentalities are not State Government for the purposes of Section 9-A (read with Section
7) of the Representation of the People Act, 1951.

Again, in [State of Assam Vs Barak Upatyaka D. U. Karmachari, AIR 2009 SC 2249] the
Supreme Court held that the fact that a Corporate body or Co-operative Society answers the
definition of State does not make it the State Government nor will the employees of such a
body, become holders of civil posts or employees of the State Government. Therefore, the
fact that a Corporation may answer the definition of State does not mean that the State
Government is liable to bear and pay the salaries of its employees.
However, again the Supreme Court of India in [Indian Medical Association Vs Union of
India & Ors., AIR 2011 SC 2365] held that the rights of non-minority educational institutions
to admit students of their choice, if exercised in full measure, that would be detrimental to the
true nature of education as an occupation, damage the environment in which our students are
taught the lessons of life, and imparted knowledge, and further also damage their ability to
learn to deal with the diversity of India, and gain access to knowledge of its problems, so that
they can appreciate how they can apply their formal knowledge in concrete social realities
they will confront.

Since education is the most important function of public importance, every individual, body
or entity performing such public function should be considered as State action within the
meaning of Article 12 of the Constitution of India. The liberal interpretation of State action is
the only way to protect individuals fundamental right to education in India.
The National Commission to Review The Working Of The Constitution 2002, had
recommended that in Article 12 of the Constitution of India, 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.

Currently, traditional functions of a Welfare State are being dealt and performed by the
private entities and private individuals. Where these private entities violate individuals
fundamental rights, for instance if private employers terminate LGBTs employment or
discriminate on any other unconstitutional ground, the limited interpretation of other
authority under Article 12 of Constitution of India would be a wrong law. The individuals
should be empowered to enforce their fundamental rights against private entities too.

Conclusion
The definition of State was initially treated to be exhaustive, confined to the authorities
stipulated under Article 12 of the Constitution of India and those which could be read
ejusdem generis with the authorities mentioned in Article 12 itself because till about the year
1967 the Courts had taken the view that even statutory bodies, Universities, Section
Committee for admission to Government Colleges were not other authorities for the purpose
of Article 12 of the Constitution of India.

But, the definition of State has been expanded by judicial interpretation. The National
Commission to Review the Working of the Constitution, set up vide Government Resolution
dated 22 February, 2000, recommended to add an explanation in Article 12 of the
Constitution as:
Explanation
In this Article, the expression other authorities shall include any person in relation to such of
its functions which are of a public nature.