Professional Documents
Culture Documents
ADMINISTRATIVE LAW
ON
Administrative law
SUBMITTED TO:
MR GIRISH R.
GANDHINAGAR
SUBMITTED BY:
TABLE OF CONTENTS
PAGE
ACKNOWLEDGMENTS 3
LIST OF ABBREVIATIONS 4
LIST OF CASES 6
BIBLIOGRAPHY 9
INTRODUCTION 10
CHAPTERS
CONCLUSION 31
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TORTIOUS LIABILITY OF A STATE
ACKNOWLEDGMENTS
I would like to thank Mr. Girish R., faculty, Administrative Law, Gujarat National
Law University, for giving me the opportunity to present a research paper on Tortious
Liability of a State, thereby helping me broaden my horizons on the topic and helping me to
refine my research – skills. I am highly indebted to the librarians and the Xerox Room staff
for providing me with relevant material and reference books which helped me with my
project.
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TORTIOUS LIABILITY OF A STATE
LIST OF ABBREVIATIONS
1. S - Section
2. & - And
3. Eg. - Example
4. Ed. - Edition
5. All - Allahabad
6. ER - England Reporter
7. Vol. - Volume
8. Para. - Paragraph
9. Co. - Company
27. P - Paragraph
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TORTIOUS LIABILITY OF A STATE
LIST OF CASES
1. Kartick v. W.B.S.I.C.
2. Ramana v. I.A.A.I
31. M. Vijaya v. Chairman and Managing Director, Singrani Collieries Co. Ltd.
38. Inder Puri General Stores v. Union of IndiaNilabati Behera v. State of Orissa
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TORTIOUS LIABILITY OF A STATE
BIBLIOGRAPHY
Statutes Referred:
Books Referred:
2. Justice G. P. Singh, The Law of Torts – Ratanlal and Dhirajlal, Sixth Edition,
Wadhwa Nagpur Publications
4. Mark Elliott, Administrative Law (Text and Materials) – Beatson, Matthews and
Elliot, First Indian Edition, Oxford University Press
Web-sites referred:
1. www.manupatra.com
2. www.jstor.org
3. www.westlaw.com
4. www.lexisnexis.com
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TORTIOUS LIABILITY OF A STATE
INTRODUCTION
This project mainly deals with the liability of a State or a Government, where the
action is done either by the officials of the Government or by the State as a whole, and where
the question of the liability of the State and protection of the rights of the citizens arises. The
basic question of this project is primarily to decide, the cases where the State or the
Government can be said to be sovereign institutions- to decide if they are liable or not for
their actions. To find answer to this question, it becomes necessary to understand the concept
of “State” as provided in the Constitution under Art. 12.
For better presentation and understanding of the topic, the present project has been
divided into three Chapters.
Chapter – I of this project concentrates of the scope of the term “State” which
includes the Government, the Parliament of India, any form of Legislature and all local and
other authorities that are under the control of the Government of India. In liberal ordinary
sense a State is any form of institution, authority or a body of people that has the powers to
makes and legislates uniform laws to provide Fundamental Rights to the citizens as provided
under Part – III of the Constitution. Hence, any action can lie against such a State even under
non – constitutional grounds or when its actions have been performed in violation of the Part
– III of the Constitution. And authorities that are under the control of the Government of
India need not necessarily be a Government Department or a Legislature. Institutions like
schools, colleges, hospitals etc. also come within the ambit of the word “State” as defined
under Art. 12. Other local authorities and local self – governments also come within the
meaning of the word “State”. Authorities located outside India can also come under the
jurisdiction provided by Art. 12, if these authorities are essentially under the control of the
Government of India. Judicial, Quasi – Judicial, Administrative and Legislative authorities
falling under the control of the Government of India, are necessarily what constitute a
“State”.
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of the liability of a State, it becomes necessary to understand the principle of vicarious
liability provided under the Tort law. The principle of vicarious liability states that in case if
there is a master – servant, principal – agent or a partnership relationship between the
employer and the employee, the employee will have to be compensated by the State or the
employer, if and only if his Fundamental Rights have been violated during the course of his
employment. The State and all the other institutions and authorities falling within its ambit
can be held to be liable to pay damages to the employee if any damages have been occurred
to violate his Fundamental Rights when he is in the course of his employment. If the
employee is not working for such institutions, and breach of this rights occur, the State
cannot be made liable to compensate for the damages caused to him.
The Constitution of India under Art. 300 provides for the instances when the State or
a Government institution can be sued. But if the person has been damaged when the
Government has been acting as a sovereign, the State cannot be made liable to pay damages
to compensate to the victim. Sovereignty of the Government means individual acts of the
Government, not hindering the rights of the citizens or causing breach of any of the
Fundamental Rights.
Chapter – III of the project deals with situations where tortious liability of a State
arises. Tort means a civil wrong that has been committed that have led to damages being
caused to the victim. Tortious liability of a Government means a situation where the
Government is to be held liable for a civil wrong committed by any official working for the
Government or the State as a whole, against an individual, that has resulted in violation of his
Fundamental Rights. As explained earlier, liability of a Government only arises in situations
where the Government has not been acting as a sovereign. A situation of vicarious liability
has been created where, as per the definition, one person is held liable for the acts committed
by the others. In a situation where vicarious liability is said to have arisen for the State, the
Government or an official working for the Government has caused breach of the
Fundamental Rights of an individual. Thus determination of the liability of a State and to
decide whether it is a sovereign or otherwise, is one of the main question that has been dealt
with under Chapter – III.
Chapter – III also deals with the situation of the law before and after the Constitution
was enacted and relates to instances where and in what cases the Government is made liable
11 | P a g e
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for acts committed by people working for it. Comparison between the English Law and the
Indian Law has been made with regard to the position of tortious liability of the State.
Chapter – III (A) essentially deals with the act of a State where the acts have been
committed by one sovereign against another sovereign or any other alien body or territory.
There is a immunity from courts’ interference in respect of an act done by the State against
an alien outside its territory, since the courts cannot try the acts committed by the sovereign
under the general municipal law. If the fault of the State or the Government has been brought
under the jurisdiction of a general court of the country, it cannot fall under the ambit of the
meaning of the words “act of a State” as they cannot try cases between two sovereigns under
the general municipal law. The case of Nabob of Carnatic v. East India Company1 was a
landmark judgment simplifying the meaning of this principle and clearing the doubts
between acts done by a sovereign against another sovereign and acts done by a sovereign
against its subjects.
1
30 ER 391 and 521, (1793).
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CHAPTER – I
INTRODUCTION TO A “STATE”
“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.2”
Scope:
This definition in Art. 12 is only for the purpose of application of the provisions
contained in Part – III. Hence, even though a body of persons may not constitute ‘State’
within the instant definition, a writ under Art. 226 may lie against it on non – constitutional
grounds or on ground of contravention of some provision of the Constitution outside Part –
III, e.g., where such a body has a public duty to perform or where its acts are supported by
the State or public officials.3
The words “State” and “Authority” used in Art. 12, remain among “the great
generalities of the Constitution” the content of which has been and continues to be applied
2
Y. V. Chandrachud, J., S. S. Subramani, J. and B. P. Banerjee, J., Durga Das Basu – Commentary on the
Constitution of India (Part – 1), 8th Edition 2007, Wadhwa Nagpur Publications.
3
Kartick v. W.B.S.I.C., AIR 1967 Cal 231 (234).
4
Ramana v. I.A.A.I, AIR 1979 SC 1628 (paras. 14-16); State of Punjab v. Raja Ram, AIR 1981 SC 1694 (para.
5); Gulam v. State of U.P., AIR 1981 SC 2198 (para. 23); Som Prakash v. Union of India, AIR 1981 SC 212
(paras. 34, 37).
5
Ibid.
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TORTIOUS LIABILITY OF A STATE
by Courts from time to time.6 Thus, it includes all constitutional or statutory authorities on
whom powers are conferred by law7, including even autonomous bodies8 whether they are
under the control of the Government or may be regarded as agents or delegates of the
Government or not.9
Local authorities are under the exclusive control of the States, by virtue of entry 5 of
List II of the 7th Schedule. That entry contains a list of some local authorities. A ‘local
authority’ is defined in section 3(31) of the General Clauses Act X of 189710 as follows –
“ ‘local authority’ shall mean a municipal committee, district board, body of port
commissioner or other authority legally entitled to, or entrusted by the Government with, the
control or management of a municipal or local fund”.
‘Other authorities’ refer to authorities other than those of local and self Government,
who have power to make rules, regulations etc., having the force of a law. In view of the
Supreme Court’s decision in Rajasthan State Electricity Board v. Mohan Lal16 there is no
6
Pradeep Kumar Biswas v. Indian Institute of Chemical Biology, (2002) 5 SCC 111 (Supra).
7
Rajasthan State Electricity Board v. Mohan Lal, (1967) 1 SCR 377 (385); Casebook, p. 36, (para. 4-5).
8
Ibid.
9
Ujjam Bai v. State of U.P., (1963) 1 SCR 778 (969), per AYYANGAR, J.; Ramamurthi v. Chief Commr.,
(1964) 1 SCR 656 (666).
10
State of Gujarat v. Shantilal, AIR 1969 SC 634 (643); Rashid Ahmed v. Municipal Board, (1950) SCR 566
(571) : AIR 1950 SC 163.
11
Ibid.
12
Ajit Singh v. State of Punjab, AIR 1967 SC 856 (866); Bhagat Ram v. State of Punjab, AIR 1967 SC 927.
13
State of Gujarat v. Shantilal, AIR 1969 SC 634 (643); Rashid Ahmed v. Municipal Board, (1950) SCR 566
(571) : AIR 1950 SC 163.
14
R. I. Handicraft Manufacturing Association v. Kottayam Municipality, AIR 2000 Ker. 30.
15
Natwarlal Khodidas Parmar v. Dist. Panchayat , Jamnagar, AIR 1990 Guj 142.
16
(1967) 1 SCR 377 (385).
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common genus in Art. 12 and that, accordingly, this expression ‘other authorities’ cannot be
construed ejusdem generis with the authorities specifically mentioned, it is now clear that in
order to be ‘State’ an authority need not necessarily exercise governmental functions or
constitute an instrumentality of the Government.17 The real test is whether it is endowed
with constitutional or statutory powers. If the test is satisfied, even a statutory corporation,
having a legal entity separate from the State, and carrying on non – governmental functions
would be ‘State’ under Art. 12, e.g., a University 18, the State Trading Corporation19 and that
the ‘other authorities’ included in Art. 12 have no common genus.20
An authority which is located outside India may still come under the definition of
‘State’ under Art. 12 if it is under the control of the Government of India. These words
extend to the application of the fundamental rights to areas outside the territory of India,
which may be under the control of the Government of India for the time being, e.g.,
mandatory and trust territories which might be placed by international organisations under
the control of the Government of India. This article explains that India would not
discriminate, so far as the fundamental rights of individuals are concerned, between its own
nationals and the people of other countries, which might come under the administration of
India under some international arrangement.22
The Supreme Court23 has, however, given to the above words a meaning different
from that given in the Constituent Assembly. According to the Supreme Court, the words
‘under the control of Government of India’ control the word ‘authorities’ and not the word
‘territory’, so the expression would be read thus:
17
Ramamurthi v. Chief Commr., (1964) 1 SCR 656 (666).
18
Ibid. State Trading Corporation v. C.T.O., (1964) 3 SCR 99 (123, 155, 189).
19
State Trading Corporation v. C.T.O., (1964) 3 SCR 99 (123, 155, 189).
20
Housing Board v. H.H.B.E.U., AIR 1996 SC 434 (para. 52).
21
Pradeep Kumar Biswas v. Indian Institute of Chemical Biology, (2002) 5 SCC 111 – para. 74.
22
Dr. Ambedkar, Constituent Assembly Debates, Vol. VI, p. 607.
23
Ramamurthy v. Chief Commr., AIR 1963 SC 1464 (1467-8); Masthan Sahib v. Chief Commr., AIR 1963 SC
533 (537). See also Pradeep Kumar Biswas v. Indian Institute of Chemical Biology, (2002) 5 SCC 111 (supra);
Sonu Prakash Rakhi v. Union of India, (1981) 1 SCC 449 : AIR 1981 SC 212.
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”all local or other authorities within the territory of India or all local or other
authorities under the control of the Government of India”.
(a) Authorities situate within the territory of India; these need not be under the control of
India in order to be deemed ‘State’ under Art. 12.
(b) Authorities situate outside the territory of India (e.g., territories administered by India
under the Foreign Jurisdiction Act, 1947); these will come within the purview of Art.
12 only if they are under the control of India.
The further discussion on the scope of the word state can go long. As a matter of fact an
entire project can be made on this point, but it will give it a constitutional perspective while
ours is an administrative analysis. So owing to that point the discussions are limited.
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CHAPTER – II
Vicarious liability is a concept of Tort Law meaning the liability to be borne by one
person for the acts committed by another person. The principle of vicarious liability arises
only in certain cases and where a relationship has been established between the two persons.
These relationships are mainly categorized in three parts: (a) Principle and Agent, (b)
Partners, and (c) Master and Servant. The liability of the principal arises when his agent
commits a tort in the course of performance of his duty as an agent and hence they are
considered to be joint tortfeasors since their liability is joint and several. When the wrongful
act is done by one partner in the ordinary course of the business of the firm, all the other
partners are vicariously liable for the same. Their liability is also joint and several and the
plaintiff can choose to sue either one of the partners or the entire firm for the tort committed
by the guilty partner. The same rule applies in the case of master – servant relationship where
the master is vicariously liable for the wrongful act done by his servant in the course of
employment.
The principle of vicarious liability underlines one very important concept. It states
that in the case of a principal – agent, partners, or a master – servant relationship, the
principal, all of the partners, and the master, respectively, can only be sued if the agent, the
guilty partner, and the servant commit the wrongful act during the course of their
employment. In the case of Trilok Singh v. Kailash Bharti24, while the owner of the motor
cycle was outside the country, his younger brother took the motor cycle without his
knowledge or permission and caused the accident. It was held that the younger brother could
not be deemed to be the agent of the owner of the motor cycle and the latter could not be
vicariously liable for the accident.
In the case where a state is to be held liable for the acts committed by its employees
and officials, Art. 300 of the Constitution should be reffered. Art. 300 of the Constitution
of India is as under:
Art. 300 (1) The Government of India may sue and be sued by the name of Union of
India and the Government of a State may sue or be sued by the name of the State and may,
subject to any provision which may be made by Act of Parliament or of the Legislature of
24
1986 ACJ 757 (P & H).
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such State enacted by virtue of power conferred by this Constitution, sue or be sued in
relation to their respective affairs in the like cases as the Dominion of India and the
corresponding Provinces or the corresponding Indian States might have sued or been sued if
this Constitution had not been enacted.
(a) any legal proceedings are pending to which the Dominion of India is a party, the
Union of India shall be deemed to be substituted for the Dominion of those proceedings; and
(b) any legal proceedings are pending to which a Province or an Indian State is a
party, the corresponding State shall be deemed to be substituted for the Province or the
Indian State in those proceedings.
No action lies against the Government for injury done to an individual in the course
of exercise of sovereign functions of the Government. If the Government has been acting out
of its own accord, and during such a course of fulfilment of the duty, it causes injury to any
individual, then the individual cannot be compensated for the damages done to him because,
such an act was done as a sovereign function and injury to the individual was not caused to
him during the course of his employment. Art. 300 provides for situations under which the
Government of India can be sued after the commencement of the Constitution. It provides for
the trial of those cases that are pending in the Courts before and after Indian independence
and admission and disposal of those cases under the name of Union of India.
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CHAPTER – III
TORTIOUS LIABILITY
(i) Britain: Before 1947, the Crown enjoyed immunity from tortious liability
under the common law because it was believed that the neither any wrong could be
imputed to the King and nor could he authorize any wrong, and as such, the King
could not be held responsible for the negligence or misconduct of his servants.
Moreover, as per one of the aspect of the doctrine of immunity, it was regarded as an
attribute of sovereignty that the state could not be sued in its own courts without its
consent. To mitigate the injustice arising out of the immunity rule, the government
would pay compensation in proper cases by settling the matter with the injured party.
However, as it was decided in the case of Tamlin v. Hannaford25, statutory
corporations were held liable for torts. Hence, the position was accordingly changed
by the Parliament enacting the Crown Proceedings Act, 1947, which makes the
Crown in principle liable for torts to the same extent as a private person of full age
and capacity subject to such exception, inter alia, as defence of the realm, armed
forces and postal services. The Crown thus becomes vicariously liable o a very large
extent for the torts committed by its servants.
(ii) U.S.A: In the United States of America, the Federal Tort Claims Act, 1946,
defines the tortious liability of the central government. In the case of common law
duties, the U.S. Government is liable to the same extent as a private individual under
like circumstances. Intentional torts such as assault, battery, false imprisonment etc.
are excluded. The Act exempts the government from liability for torts committed by
officials in the discharge of their discretionary functions conferred on them by
statutes, even if the discretion is abused or there is negligence, so long as it is
exercised with due care. The tortious liability of the U.S. Government is more
restricted than that of the British Government. The Supreme Court of America, in the
case of U.S. v. Muniz26, where the question arose that whether the United States was
25
(1951) 1 KB 18.
26
(1963) 10 L ed 2d 805.
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liable for the acts and omissions of its employees resulting in death of, or personal
injuries to, a federal prisoner, accepted the allegations. The Court emphasized that the
Federal Tort Claims Act was designed not only to avoid injustice to those having
meritorious claims barred till then by sovereign immunity but it also waived the
sovereign immunity for claims arising out of the negligent treatment in government
hospitals.
b. Position in India:
(i) Pre – Constitution: The extent of liability of the government for torts of its
employees is defined by Art. 300(1) of the Constitution which declares inter alia that
the Government of India, or of a State, may sue or be sued “in relation to their
respective affairs in the like cases as the Dominion of India and the corresponding
Provinces or the corresponding Indian States might have sued or “been sued” if the
Constitution had not been enacted. This is subject to any law made by the Parliament
or the State Legislature. S. 176 of the Government of India Act, 1935, stated that the
Dominion of India and the Provincial Government may sue or be sued in relation to
their respective affairs in the like cases as the Secretary of State for India in Council
might have sued or been sued if the Government of India Act of 1935 had not been
enacted. Thus, the liability of the Government was made co – extensive with that of
the Secretary of State for India under S. 32 of the Government of India Act, 1915,
which in turn made it co – extensive with that of the East India Company prior to the
Government of India Act, 1958. S. 65 of this Act thus preserved against the
government the same suits and proceedings which were then available against the
East India Company. The Secretary of State for India in Council could be sued in all
those cases in which the East India Company could be sued before 1858 27. By the
Charter Act of 1833, the East India Company came under the hold of the Government
of India in trust for the British Crown. In 1858, the Crown assumed sovereignty in
India to take over the administration of India from the hands of the Company. Thus,
from 1765 to 1858, the Company had a dual character: it was a trader and also
27
By 3 & 4 Will IV, C. 85, the East India Co. was made a trustee for the Crown in respect of all the property
which it possessed in India. The Act of 1858 transferred the Indian Territories to the Crown. As the Queen
could not be sued in her own courts under the common law prevailing at the time, the Act provided that the
Secretary of State as a body corporate would have the same rights of suit as the Company had and would be
subject to the same liability of being sued as previously attached to the East India Company.
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exercised some sovereign powers. As the Company was an autonomous corporation,
having an existence of its own, and bearing no relationship of servant or agent to the
British Crown, the immunity enjoyed by the Crown was never extended to it.
(a) Apart from any special statutory provision, suits could have been
brought against the East India Company and, consequently, against the
Secretary of State as successor to the Company, in respect of acts done in the
28
5 Bom HCR App. 1.
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conduct of an undertaking which might be carried on by private individuals
without sovereign powers.
(b) The Secretary of State was not liable for anything done in the exercise of
sovereign powers.
The P. & O. case was considered by the Madras High Court in the case of
Secretary of State v. Hari Bhanji29. The facts of the case, briefly stated, were that
during the course of transit of salt from Bombay to Madras ports, the rate of duty on
salt as enhanced and the merchant was called upon to pay the difference at the port of
destination. He paid under protest and instituted a suit for recovery. The court ruled
that the immunity of the East India Company extended only to “acts of state”, strictly
so – called and that the distinction based on sovereign and non – sovereign functions
of the East India Company was not well founded. Acts thus done in the exercise of
sovereign powers but which do not profess to be justified by municipal law are what
we understand to be the acts of State which municipal courts are not authorised to
take cognizance.30
As regards P. & O., it was said that it was an authority for the proposition that
the government was responsible for injuries in the course of transactions of a
commercial or private character, but that it did not exclude liability in other respects.
In Hari Bhanji, a broader view of government liability, and a narrower view of the P.
& O. ruling was adopted. The view propounded that the government was liable for all
acts other than an ‘act of state’ and that the distinction based on ‘sovereign’ and ‘non
– sovereign’ functions was not well founded. The view was taken that the acts of the
government fell either outside, or within, the municipal law and that it was only the
former of which the courts could not take cognizance.
29
(1882) ILR 5 Mad 273.
30
(1882) ILR 5 Mad 273, 279, emphasis supplied.
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While the line of reasoning adopted by the court in Hari Bhanji found some
support in a few later cases, in effect, the P. & O. view drawing distinction between
sovereign and non – sovereign functions came to be perpetuated in the case of
Forrester v. Secretary of State for India.31 Had the view propounded in Hari Bhanji
found judicial acceptance in India, the position as regards the tortious liability of the
government would have developed on entirely different lines. But the view that found
general judicial acceptance, and thus became the ruling norm, was that the
government was not liable for any tortious liability arising out of the exercise of a
‘sovereign’ function.
(ii) Post – Constitution: Even in Republican India after the new Constitution
came into force in 1950, the pre – Constitution judicial trend continued and the courts
kept on enforcing the P. & O. ruling. The courts continued to distinguish between
sovereign and non – sovereign functions of the government for purposes of
governmental liability.
a. Transportation:
31
IA, Suppl. Vol. 55.
32
AIR 1952 Cal 242.
33
AIR 1962 SC 933 : 1962 Supp (2) SCR 989.
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Similar are the judgments of various High Courts and the Supreme Court in
various cases concerning the state liability, in light of the Vidhyawati34 case. In the
case of Annamalai v. Abithakujambal35, a person was killed in an accident with a jeep
driven by a government employee during the scope and course of his employment.
Hence, the court held that the government was to be held liable to pay damages to the
widow of the deceased on the principle of vicarious liability for its servant’s tortious
act, as driving a jeep is a non – sovereign function, since any person can drive a jeep.
b. Railways:
c. Military Vehicles:
In several cases, the government has been held liable to pay compensation for
injuries caused by negligent driving of military vehicles engaged in doing various odd
jobs. The test applied is not that a military vehicle was involved in an accident, but
the purpose on which the vehicle was employed and whether that purpose could be
characterized as ‘sovereign’. If not, the government would become vicariously liable
for the torts of its servants.
The government was held liable under the general principles of law of torts in
the case of State of Punjab v. Modern Cultivators39, where the plaintiff brought a suit
for compensation against the State Government for the damage caused to his land and
crops due to inundation as a result of breach in canal maintained by the government
under the Northern India Canal and Drainage Act, since the breach had been caused
by the negligence of the government employees.
Art. 21 of the Constitution of India plays a very important role in this part,
since it means right to live with human dignity and this includes a guarantee against.
38
AIR 2001 AP 502.
39
AIR 1965 SC 17 : 1964 (8) SCR 273.
40
AIR 2000 SC 988 : 2000 CrLJ 1473 : (2000) 2 SCC 465.
41
AIR 1983 SC 1086 : 1983 CrLJ 1644 : (1983) 4 SCC 141 : (1983) 3 SCR 508.
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Resources Centre v. Commr. of Police, Delhi,44 also lead to the inference that the
defence of sovereign immunity is not available when the State or its officers acting in
the course of their employment infringe a person’s fundamental right of life and
personal liberty as guaranteed by Art. 21 of the Constitution.
In the case of Inder Puri General Stores v. Union of India45, loss of property
was caused to the petitioners in a communal riot in Jammu. The Government made an
ex gratia payment of Rs. 25,000 as compensation to the petitioners whereas the
government appointed expert committee had assessed the loss at a much higher
figure. Directing the Government to pay adequate compensation to the petitioners for
the loss suffered by them, the High Court pointed out that the maintenance of law and
order is the duty of a responsible government; it cannot abdicate this function and put
the life and liberty of the citizens in jeopardy.
h. Police Lawlessness:
Similarly, in the case of Ross v. Secretary of State48, the Secretary of State was
held not liable for the wrongful acts of the district magistrate done by him in the
exercise of statutory authority.
a. Government Companies:
47
143 ER 1148. Also, Nieraha v. Baker, 1901 AC 561; Stanbury v. Exeter Corporation, (1905) 2 KB 839.
48
AIR 1915 Mad 434.
49
AIR 1975 Knt 62.
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The government sets up a number of statutory corporations or bodies
incorporated under the Companies Act. Most of these bodies are engaged in carrying
commercial enterprises. Actions for damages against such bodies for tortious acts of
their servants are not covered by Art. 300 of the Constitution and therefore the
principles of the general law of torts are applicable to them to the same extent as to
any corporate body. Thus, in National Small Scale Industries Corpn. v. Bishambhar
Nath50, the corporation was held liable for the damage caused to the building of the
respondent [of which the corporation was a tenant] due to the negligence of the
employees of the corporation.
The courts have also awarded compensation for injuries or death caused to
persons because of negligence of the statutory electricity boards to properly maintain
electric installations. In the case of Kerala State Electricity Board v. Suresh Kumar51,
where Rule 77(3) of the Indian Electricity Rules, 1956, which imposes a duty on the
electricity board to hold 11 KV overhead lines at a height of 15 feet above the
ground, was violated, and instead the line in the instant case sagged to a height of 9
feet above the ground and a boy came in contact with the line and sustained serious
burns and injuries which affected his physical and mental capacities. The court
ordered the board to pay a sum of Rs. 1,02,000/- along with interest from the date of
filing the suit by way of compensation to the plaintiff for the injuries suffered by him.
The liability of the post office was first questioned in Union of India v. Mohd.
Nazim52. The Supreme Court has ruled that post office which has been established by
a statute53 is not a common carrier. It is not an agent of the sender of the postal article
for reaching to the addressee. It is really a branch of the public service providing
50
AIR 1979 All 35.
51
AIR 1986 Ker 72.
52
AIR 1980 SC 431 : (1980) 1 SCC 284.
53
The Post Office Act, 1898.
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postal services subject to the provisions of the Post Office Act and the rules made
thereunder.54
54
Traifus & Co. Ltd. v. Post Office, (1975) 2 QB 352; Cf. C.I.T. v. P.M. Rathod & Co., AIR 1959 SC 1394 :
1960 (1) SCR 401; Union of India v. Amar Singh, AIR 1960 SC 233 : 1960 (2) SCR 75.
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CHAPTER – III (A)
ACT OF A STATE
The government is not regarded as liable for an “act of state”. An act of state, under
the English law, is an act of executive as a matter of policy performed in the course of is
relations with another state during its relations with the subject of that state, unless they are
temporarily within the allegiance of the Crown. An act of state is an act of a sovereign
against another sovereign or an alien outside its territory. It is a sovereign act which is not
grounded in law. As an act of state derives its authority not from municipal law but from
ultra – legal or supra – legal means, municipal courts have no power to examine the propriety
or legality of an act of state. There is immunity from courts’ interference in respect of an act
done by the state against an alien outside its territory.55 This principle has also been applied
in India in a number of cases in the pre – Constitution era with respect to the princely states
existing at the time.
In Nabob of Carnatic v. East India Company56, a suit brought by the Nabab against
the Company for an account under a political treaty between the Company and the Nabab
was dismissed as it was a matter between two sovereigns, the Company was having acted
throughout in its political capacity. In East India Company v. Sayed Ally57, it was held that
the resumption by the Madras Government of a jagir granted by the former Nabab of
Carnatic before the date of cession to the East India Company was an act of sovereign power
and so exempt from the jurisdiction of the courts.
There can be no act of state between a state and its subjects, and such an act is not
immune from judicial scrutiny. If the government justifies its act under a municipal law, that
act cannot be an act of state. Its legality and validity must be tested by the municipal law and
in municipal courts.58
55
Eshugbayi Eleko v. Govt. of Nigeria, (1931) AC 692.
56
30 ER 391 and 521, (1793).
57
7 MIA 555 (1827).
58
P. V. Rao v. Khushaldas, AIR 1949 Bom 277, 278.
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CONCLUSION
The definition of a ‘state’ provided in Art. 12 of the Constitution of India includes the
Government and the Parliament of India, the Government and Legislature of each state, all
local and other authorities within the territory of India, and all local and other authorities
outside India, that is under the control of the Government of India. It thus includes all
legislative and executive organs of the state Union and the states. Thus, all corporations,
municipal bodies, schools, universities, railways, post-offices, etc. fall within the ambit of the
meaning of the word ‘state’ as defined in Art. 12.
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It is therefore concluded that when a state is exercising sovereign functions of its
own, it cannot be sued. In case if damages have been caused to the employee during the
course of his employment, the government is required to pay compensation to the employee
for the damages caused. All private institutions do not fall under the concept of the definition
of a state. Hence, if a private corporation is tried and charged for committing an offence
against an employee and where an employee is damaged, the government cannot be
compelled to pay compensation to the employee, since the private institution is a sovereign
and it is performing sovereign functions that do not fall within the control of the Government
of India. In case where the act has been committed by the state, the government is still liable
to pay compensation to the employees. Thus, in case where a tort has been committed by a
government that is not in exercise of its sovereign functions, it will be held liable to pay all
costs to the aggrieved party.
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