State of U.P. v.

Radhey Shyam Rai

IN THE HONBLE
SUPREME COURT OF INDIA
In the matter of
State of U.P.
(Appellant)
v.
Radhey Shyam Rai
(Respondent)
MEMORANDUM FOR THE APPELLANT
COUNSEL FOR APPELLANT
(NITESH DHANKHAR)
ROLL NO.- 84 SEM: 3

HIDAYATULLAH NATIONAL LAW

UNIVERSITY, RAIPUR

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State of U.P. v. Radhey Shyam Rai

TABLE OF CONTENTS

LIST OF ABBREVIATIONS

INDEX OF AUTHORITIES

STATEMENT OF JURISDICTION

STATEMENT OF FACTS

ISSUES RAISED

SUMMARY OF PLEADINGS

WRITTEN SUBMISSION

10

PRAYER FOR RELIEF

16

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State of U.P. v. Radhey Shyam Rai

LIST OF ABBREVIATIONS

Paragraph

&

And

AIR

All India Reporter

Edn.

Edition

Etc.

Et Citra.

Govt.

Government

Honble

Honorable

HC

High Court

P.

Page Number

SC

Supreme Court

SCC

Supreme Court Cases

v.

Versus

www

world wide web

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State of U.P. v. Radhey Shyam Rai

INDEX OF AUTHORITIES
STATUTUES:
Constitution of India, 1950.
Constituent Assembly Debates Vol. III and VII.
JUDICIAL DECISIONS:

Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 1 SCC 722.

M.C. Mehta v. Union of India, AIR 1987 SC 1086.
Pradeep Kumar Biswas v. Indian Institute of Chemical Biology, (2002) 5 SCC 111.
Rajasthan State Electricity Board v. Mohan Lal, (1967) 3 SCR 377.
Ramana Dayaram Shetty v. International Airport Authority of India, (1979) 3 SCC 489.
Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi, (1975) 1 SCC 421.
University of Madras vs Shantha Bai, AIR 1954 Mad 67.

BOOKS:
H.M., Seervai, Constitutional of India (Universal Law Publishing Co.,2005 (4th edn.).
M.P. Jain, Indian Constitution (Wadhwa and Co., Nagpur, 2005 (5th edn.)).
V.N. Shukla, Constitution of India, (Eastern Book Company, Lucknow, 2008 (11th edn.)).
Durga Das Basu, Comparative Constitutional Law, (Lexis Nexis Butterworths, Wadhwa
Nagpur, 2008 (2nd edn.)).
DICTIONARIES:
Concise Oxford Dictionary, 10th. Edn, Oxford University Press, 2002
Garner Bryan, Blacks Law Dictionary, 7th Edn, West Group Publications, 2002.
WEBSITES:

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State of U.P. v. Radhey Shyam Rai

www.manupatra.com

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State of U.P. v. Radhey Shyam Rai

STATEMENT OF JURISDICTION

The appellant has approached this Honble Supreme Court of India under Article 133 of the
Indian Constitution.

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State of U.P. v. Radhey Shyam Rai

STATEMENT OF FACTS
1. Prior to establishment of U.P. Ganna Kisan Sansthan, the Cane Department was
imparting training to the Government Officers and the cane-growers. The State
Government in order to increase the production of Sugar in the State came to the
conclusion that to achieve this target it is necessary to impart knowledge/ training to the
cane-growers and connected persons.
2. The Government, therefore, took a policy decision of establishing U.P. Ganna Kisan
Sansthan by Government Order dated 17th May, 1975. By another Government Order
dated 3rd November 1976 (SCA-III) addressed to the Cane Commissioner, it was
provided that training Centers (Shahjahanpur, Muzaffarnagar and Gorakhpur), which
were earlier run by Cane Development Department of the Government of U.P. were
transferred to the Sansthan.
3. Respondent was appointed in the post of Computer Officer/ Data Processing Officer in
Sansthan. The Governing Council of the Sansthan in its meeting held on 28.04.1997
resolved to abolish the posts created and to cancel the appointments made, pursuant
whereto the services of the respondent were dispensed with by an order dated 17.05.1997.
4. Feeling aggrieved by the said order dated 17.05.1997, he filed a writ petition before the
Lucknow Bench of the High Court of Judicature at Allahabad being Writ Petition No. 869
of 1998 wherein one of the issues raised was whether the Sansthan is a `State' within the
meaning of Article 12 of the Constitution of India.
5. The writ petition filed by the respondent came up for consideration before a Division
Bench of the High Court. It noticed an earlier decision of another Division Bench of the
said Court wherein it was opined that Sansthan is not a `State' within the meaning of
Article 12 of the Constitution of India.
6. However, a different view was taken. The question as to whether the Sansthan would
answer the description of a `State' within the meaning of Article 12 of the Constitution of
India was, referred to a Full Bench of the High Court. The Full Bench held that the

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State of U.P. v. Radhey Shyam Rai

Sansthan being an authority would come within the purview of definition of `State' within
the meaning of Article 12 of the Constitution of India.
7. It is the order of full bench of High Court, against which the present appeal has been
brought to the Honble Supreme Court of India.

ISSUES RAISED

A. Whether the Uttar Pradesh Ganna Kishan Sansthan (for short the Sansthan), a
society registered under the Societies Registration Act is a `State' within the
meaning of Article 12 of the Constitution of India?

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State of U.P. v. Radhey Shyam Rai

SUMMARY OF PLEADINGS
A. No, the Uttar Pradesh Ganna Kishan Sansthan is not `State' within the meaning of
Article 12 of the Constitution of India. The Sansthan is financially independent and
state government doesnt have a deep and persuasive control in its management, which
clearly takes away Sansthan from purview of definition of State under Art. 12. Also, the
function performed by Sansthan is not important public service and does not enjoy a
monopoly status.

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State of U.P. v. Radhey Shyam Rai

WRITTEN SUBMISSION
ISSUE A The Uttar Pradesh Ganna Kishan Sansthan is not `State' within the
meaning of Article 12 of the Constitution of India.
Art. 12 of the Constitution of India states unless the context otherwise requires, the state
includes the Govt. and Parliament of India and the Govt. and the Legislature of each of the
states and all local or other authorities within the territory of India or under the control of
Govt. of India.1
So, the State as provided under Article 12 of the Constitution has four components:
1.

The Government and Parliament of India- Government means any department or

institution of department. Parliament shall consist of the President, the House of People
and Council of States

2. The Government and Legislature of each State- State Legislatures of each consist of
the Governor, Legislative Council and Legislative Assembly or any of them.

1 The Constitution of India, 1950.

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State of U.P. v. Radhey Shyam Rai

3. Local Authorities within the territory of India- Local Authority means
(i) Power to make rules, bye- laws, regulations, notifications and statutory orders. (ii)
Power to enforce them.
4. Other Authorities- Other Authorities refers to authorities other than local authorities
working (i) Within the territory of India or; (ii) Outside the territory of India.2
It is humbly submitted that the Sansthan in question is not a local authority, as Sansthan does not
have power to make laws or regulations and does not have any power to enforce such laws. So,
Sansthan will come under the definition of State under Article 12 only & only if it falls under the
definition of other authorities, which has not happened in the present case.

The law defining State under Art. 12 has been developed a lot by judicial interpretations. It is
humbly submitted that, we need not dilate on the development of law in this regard in view of
the decisions rendered by this Court beginning from Rajasthan State Electricity Board v. Mohan
Lal3 to Ajay Hasia v. Khalid Mujib Sehravardi.4
The appellant would further like to draw the attention of court towards a Seven - Judge Bench
decision of this Supreme Court of India in Pradeep Kumar Biswas v. Indian Institute of
Chemical Biology5 where the following tests for the purpose of determining the nature of
activities which would make the body come within the definition of `State' have been laid down
by this Court:
(i) Formation of the body
(ii) Objects and functions
2 Constituent Assembly Debates Vol. III and VII. Available at (Last Accessed on 13th Oct 2013, 10.03 p.m.)
164.100.47.132/LssNew/constituent/debates.html and 164.100.47.132/LssNew/constituent/vol7p21.pdf

3 (1967) 3 SCR 377.

4 (1981) 1 SCC 722.
5 (2002) 5 SCC 111.
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State of U.P. v. Radhey Shyam Rai

(iii) Management and control
(iv) Financial aid, etc.
The dicta of Mathew, J. in Sukhdev Singh v. Bhagatram Sardar Singh Raghuvanshi

is also

concurrent with the dicta of Pradeep Kumar Biswas7 case, which has propounded four indicia:
(1) State financial support plus an unusual degree of control over the management and policies8
(2) Another factor is whether the operation is an important public function9
(3) Function is of such public importance and so closely related to governmental functions, then
even the presence or absence of State financial aid might be irrelevant10
(4) The ultimate question is, for whose benefit was the corporation carrying on the business?11

[A.1] Sansthan is financially independent and is not an instrumentality of government.

It is humbly submitted that the Supreme Court in Ramana Dayaram Shetty v. International
Airport Authority of India12 has stated the following conditions for corporation to be an
instrumentality or agency of Government 1. if the entire share capital of the corporation is held by Government13
2. where financial assistance of State meets almost entire expenditure of the corporation14
6 (1975) 1 SCC 421.
7 Supra note 5.
8 (1975) 1 SCC p. 454, 96.
9 (1975) 1 SCC p. 454, 97.
10 Id.
11 (1975) 1 SCC p. 458, 111.
12 (1979) 3 SCC 489.
13 (1979) 3 SCC p. 507, 14.
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State of U.P. v. Radhey Shyam Rai

3. whether the corporation enjoys monopoly status (State conferred or State protected)15
4. Existence of deep and pervasive State control16
5. functions are of public importance & closely related to Governmental functions17
It is further submitted that as per the provisions of the Memorandum of Association, the
Governing Council has all the powers to carry out and manage the affairs of the U.P. Ganna
Kisan Sansthan, which may pay all the expenditures, incurred in promoting and registering the
U.P. Ganna Kisan Sansthan as a society.
The State Government sanctioned a grant of 50% of the total expenditure for creation of the U.P.
Ganna Kisan Sansthan & continued to give grant from 1975 to 1995 18. 50% assistance of State
does not meet almost entire expenditure of the corporation. Also, from 1995 till date the financial
assistance is given to the Sansthan from the Sugar Fund Committee. 19 Hence, Sansthan does not
satisfy conditions for corporation to be an instrumentality or agency of Government laid down by
Honble Supreme court in R.D. Shettys Case.20

Furthermore, according to Rule 29 and 33, of Memorandum of Association of the Sansthan:

14 (1979) 3 SCC p. 508, 15.

15 Id.
16 Id.
17 (1979) 3 SCC p. 509, 16.
18 Annexure- 7 of Appellants submission to Honble Allahabad High court in Radhey Shyam Rai vs
State Of U.P. Writ Petition No. 869 [SB] of 1998.
19 Annexure- 8 Id.
20 Supra note 12.
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State of U.P. v. Radhey Shyam Rai

{a} Ganna Sansthan maintains proper accounts and other supporting relevant records to enable it
to prepare the annual income and expenditure of accounts and balance sheet in such form, as
may be prescribed by the Governing Council,
{b}the investment and the funds of the Sansthan or the interest or income thereof or any part
thereof, are kept in the name of the Sansthan in one or more of the scheduled Banks or a Cooperative Bank. Thus, the U.P. Ganna Kisan Sansthan, itself is a Master of maintenance of all the
accounts.
In view of Rule 34 the books of accounts of the Sansthan and the Annual statement of accounts is
audited and examined by a Chartered Accountant appointed from time to time by the Governing
Council. Furthermore, the expenditure incurred in connection with the audit of the accounts of
the Sansthan is paid by the Sansthan.
Thus, it is clear that the U.P. Ganna Kisan Sansthan is fully independent in the matter of
accounts, and financial control.

[A.2] Sansthan is independent of governments control in its management & working.

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State of U.P. v. Radhey Shyam Rai

In Ajay Hasia v. Khalid Mujib Sehrawardi,21 the Supreme Court observed that Government may
act through natural or judicial person to carry out its function and it is not necessary that it is a
creation of a statute.
This observation was reiterated by Apex Court in the case of M.C. Mehta v. Union of India, 22
wherein it has been held that:-" What is really to be determined for whether a body is or not
"other authority" is who created the body and why- What are its aims and objects, how is it
running, the extent of Government financial aid or grant to it and its dependency on the
Government and the latter's control over it."
In R. D. Shetty v. International Airport Authority of India 23 the Supreme Court laid down
existence of deep and pervasive State control, as test for determining corporation to be an
instrumentality or agency of Government.
It has been proved earlier that the U.P. Ganna Kisan Sansthan is fully independent in the matter
of accounts and financial control. As far as the employees of the Sansthan are concerned, they
are governed by the provisions of U.P. Ganna Kisan Sansthan Service Rules, which came into
force from 1.4.1979. Rule 15 of the Service Rules provides that in case of any dispute pertaining
to the service rules, the decision of the Chairman would be final. As per Rule 16, necessary
alterations or relaxation in the Rules can be made by the Governing Council.
Moreover, the Management of the Sansthan is competent to fix pay structure of employees and
officers of the Sansthan without seeking any approval of the State Government. In 1979 when
the Sansthan drafted the Service Rules and referred it to the State Government for approval, the
State Government refused to interfere. Similarly, the State Government refused to interfere in the
matter of pay scale of the employees of the Ganna Kisan Sansthan. This all reflects that the
"Sansthan" is an independent body having its own rules and regulations.

21 AIR 1981 SC 487.

22 AIR 1987 SC 1086.
23 (1979) 3 SCC 489.
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State of U.P. v. Radhey Shyam Rai

[A.3]Functions Carried by Sansthan are not governmental or sovereign functions.

In University of Madras vs Shantha Bai24, the Madras High Court evolved the principle of
ejusdem generis i.e. of the like nature. It means those authorities are covered under the
expression other authorities which perform governmental or sovereign functions.
Following the same principle, in Sukhdev vs Bhagatram25 , LIC , ONGC ANDIFC were held to
be State as performing very close to governmental or sovereign functions. The court said the
Corporations are State when they enjoy (i) Power to make regulations; (ii) Regulations have
force of law. Furthermore in this case, Hon'ble Supreme Court has laid down the guidelines for
identifying a Corporation or Agency to be a "State" within the meaning of Article 12. A factor,
which might be considered, is whether the operation is an important public function.
If the objects incorporated in the Memorandum of Association of the Uttar Pradesh Ganna Kisan
Sansthan, are viewed keeping the aforesaid guidelines, it would be evident that the Sansthan was
setup for establishing, running and maintaining a training institute, including facilities of
boarding and lodging for the benefit of Cane Growers and the personnel in Cane Development
by giving them upto date practical knowledge about scientific ways of sugarcane cultivation and
management, and for that purpose, several other steps are to be taken. So, basically, it was for the
interest of the Cane Growers and development of Sugarcane.
The function of Sansthan was a purely a economic activity where only Cane growers were given
training and were charged for lodging and boarding, which is not a important public function.
Also, Sansthan doesnt enjoy power to formulate rules or does not have any legal force for such
rules, clearly depicting function of Sansthan to be non-governmental & non-sovereign too.
So, Sansthan is not covered under the expression other authorities for the purpose of Art. 12.

24 AIR 1954 Mad 67.

25 (1975) 1 SCC 449.
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State of U.P. v. Radhey Shyam Rai

PRAYER FOR RELIEF

Therefore in the lights of the facts stated, authorities cited, arguments advanced, the petitioner
humbly requests the Honble Court to adjudge and declare that:1. The appeal be admitted.
2. The Uttar Pradesh Ganna Kishan Sansthan is not `State' within the meaning of
Article 12 of the Constitution of India.

And, pass any order or decree in the favor of the petitioner as the Court may deem fit in the
lights of Justice, Equity & Good Conscience.

All of which is most humbly prayed.

COUNSEL ON BEHALF OF APPELLANT

NITESH DHANKHAR

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17th Oct. 2013