‘Other Authorities’ Under Article 12 – A Case For Not Expanding Its Scope

Starting from the 1980s, globalization has brought about a fundamental transformation in the relationships between nations as well as the landscape of constitutional, political, domestic and regulatory structures that govern development and economic policies in emerging nations. As a result, many developing countries have moved from socialist policies to privatization, economic liberalization and development policies and thus kept up with broader globalization of the world economy. International bodies like the International Monetary Fund and the World Bank have been the catalysts of this change and have played a key role in directly funding development projects. This transformation has greatly influenced constitutional policy and adjudication as regards these issues in the concerned nations.[1]The present article argues that in spite of the aforementioned developments, the extant constitutional provisions and the jurisprudence that has arisen therefrom is adequate for dealing with the challenges of privatization and globalization that arise in the context of Article 12 of the Constitution.

The present situation

The law as regards ‘other authorities’ has been laid down in the case of Pradeep Kumar Biswas and Ors. v Indian Institute of Chemical Biology and Ors.[2] In the said case, the court while summing up a long line of cases which had, on previous occasions, grappled with the question of the ambit of ‘other authorities’ laid down the court’s preference for ‘structuralism’.[3] The court held that a body would qualify as ‘State’ if it was ‘financially, functionally, and administratively dominated by or under the control of the Government.’[4] Thus, for an entity to fall within the meaning of ‘State’ it must meet government domination on all three fronts.[5]

As a result, the law not only lays down a definite test for considering the scope of ‘other authorities’ but also prevents an open-ended functionalist inquiry in any given situation.[6]While some may consider this to be an onerous standard susceptible to the problem of under-inclusion, the following sections argue that this is not the case.

The ramifications of expanding the scope of ‘other authorities’ in case of public private partnerships

PPP models (and their derivatives) are being utilized in numerous infrastructure projects across the globe, including India. The participation of the private sector in such models is through offer of expertise or finance or both. India has experienced a strong growth in PPP-based infrastructure projects in the last fifteen years. As per available government data dated July 2011, there were more than 700 PPP projects in India at different stages of implementation. These projects amount to an investment totaling more than $70.65 billion.[7]It is argued that the advantages offered by private sector participation area result of their legal character. If the scope of ‘other authorities’ was to be expanded so as to include such enterprises, it would result in a loss of efficiency for these enterprises.

They would lose freedom over crucial internal management decisions. This becomes apparent when one looks at the 145th Law Commission Report which proposed the exclusion of public sector undertakings from the scope of Article 12 because the constitutional limitations that being ‘State’ entails weakens their management and renders commercial enterprise-like behaviour extraordinarily difficult. In effect, this alters their very nature as business ventures.[8]

In the same vein, the private enterprises would lose control over bidding procedures, management of personnel[9], accountability[10] etc. They would be subject to administrative law and constitutional law restrictions.[11] Additionally, if the phrase ‘other authorities’ was to include such enterprises, then this would lead to the practical concerns linked to such ex-post transition in their legal status in the form of unforeseen costs and a deviation from usual managerial practices.[12]

While private enterprises are undoubtedly centers of power, their unencumbered functioning equally necessary for a developing nation like India and if they were to be subjected to the restrictions that come with being an ‘other authority’ then they would lose their efficacy completely.

The need to preserve status-quo

The need to protect the freedom and rights of private entities

Another important factor to be considered when deliberating on the inclusion of the public function test in the constitutional framework is the freedom of entities against which fundamental rights are sought to be enforced. Making private actors liable for fundamental rights violation threatens private law’s libertarian core of private autonomy. Non-state actors are entrusted with duties that are imposed on public bodies.[13]Such an application of fundamental rights is bound to adversely affect the boundaries of private sphere where entities possess liberty of choice sans the constraints of constitutional standards.[14]

The perils of indeterminacy

Throwing open the term ‘other authorities’ to include a plethora of entities on the basis of a functionalist approach or amending Article 12 so as to incorporate a public function test is extremely problematic because it will lead to the formulation of numerous judicial interpretations. Different judges will offer varying conceptions of State function.[15] An additional point to be noted here is that what constitutes State function is not always set in stone because it is bound to undergo change as a society develops. The same shall put the legal position of the country on a path of endless uncertainty and render writ jurisdiction under Article 32 widely discretionary.[16] In such a scenario, the private entities will not know whether their actions will be deemed to be State action beforehand.

Arguendo – Private entities performing public duty – R.D. Shetty[17], Unnikrishnan[18] and Zee Telefilms[19]

If at all fundamental rights are to be enforced against private entities performing a public function/duty, then it shall be done using the present constitutional scheme which does conceptually provide for such a scenario.[20] This approach will not avoid the aforementioned concerns with the public function test, but can only ameliorate the effects by not imposing Part III obligations in their entirety to non-state actors.

The Supreme Court in the case of R.D. Shetty v International Airports Authority culled out obligations of non-discrimination and fairness from two distinct avenues. One was an Article 12 analysis. The second was a public law analysis. The Court first examined the government’s obligations when it was acting in the capacity of a contractor. This comprised the aforementioned obligations. This argument was then extended to instrumentalities of the government. The Article 12 analysis,on the other hand, was sourced out of obligations contained within Article 14. The usage of Article 14 let the court to go into an Article 12 analysis. The implication being that obligations of non-discrimination and fairness arise from Article 14 as well as general principles of public law.[21] While subsequent decisions by the judiciary have narrowed down Article 12 and limited the applicability of Article 14 to bodies which have pervasive governmental control[22], the scope of public law remains intact.[23]

Two Supreme Court decisions lend weight to this argument. The first being Justice Mohan’s concurring opinion in Unnikrishnan.[24] The case dealt with the question of whether Article 14 applied to private educational institutions. The second case which supports the argument is Zee Telefilms.[25]In this case the court prevents the application of fundamental rights via Article 32 but refers to  Article 226, which vests in the High Court to issue orders and writs to any person or authority” for the “enforcement of any of the rights conferred by Part III, and for other purposes.”[26]

Therefore, it is conceptually possible to hold a non-state actor responsible for a Part III violation. The only condition being it can’t be done using Part III through an Article 32 writ petition. This approach shall prevent a blanket application of Part III and permit calibration of the scope of a given private entity’s obligation to its function.[27] However, as mentioned above, this approach will bring with it the aforementioned problems of indeterminacy, infringement of private autonomy etc.

To sum up, the obvious concerns with incorporating a public function test into the constitutional scheme provide adequate grounds for excluding private entities from the scope of fundamental rights obligations. Privatization and Globalization have indeed created centers of power, but assimilating these power centers within the ambit of public law so as to curb their authority will only lead to a skewed legal order which will do more harm than good.

References:

[1]Manoj Mate, ‘Globalization, Rights, and Judicial Review in the Supreme Court of India’ (2016) 25 Pac. Rim L. &Pol’y J. 643, 644.

[2]Pradeep Kumar Biswas and Ors.v Indian Institute of Chemical Biology and Ors.(2002) 5 SCC 111.

[3]Ananth Padmanabhan, ‘Rights: Breadth, Scope, and Applicability’ in SujitChoudhry, Madhav Khosla, and Pratap Bhanu Mehta (eds) The Oxford Handbook of the Indian Constitution ch 32.

[4]Pradeep Kumar Biswas and Ors.v Indian Institute of Chemical Biology and Ors.(2002) 5 SCC 111.

[5]Ananth Padmanabhan, ‘Rights: Breadth, Scope, and Applicability’ in SujitChoudhry, MadhavKhosla, and PratapBhanu Mehta (eds) The Oxford Handbook of the Indian Constitution ch 32.

[6] ibid.

[7] Ministry of Finance, PPP Projects Status Report (31 July 2011) <http://www.pppindiadatabase.com/Uploads/Status%20of%20PPP%20Projects%20as%20on%20July%2031,%202011.pdf>accessed  28 September 2016.

[8]Law Commission of India, Article 12 of the Constitution and Public Sector Undertakings (Report No 145, 1992).

[9]Sirsi Municipality by its President, Sirsi v Cecelia Kom Francis Tellis AIR 1973 SC 855

[10]Dr.Panjabrao Deshmukh Urban Co-operative Bank Ltd., Vidarbha Region v State Information Commissioner AIR 2009 Bom 75.

[11]SantanuSabhapandit, ‘Application of Public Law Principles to Entities Implementing PPPs in India: The Current “State” of Affairs’ (2015) 24 (2) P.P.L.R. 33.

[12]ibid 45.

[13] O. Gerstenberg, ‘Private Law and the New European Constitutional Settlement’ (2004) 10 European Law Journal766, 769.

[14] Hugh Collins, ‘On the (In)compatibility of Human Rights, Discourse and Private Law’ LSE Law, Society and Economy Working Papers 7/2012 35 <https://www.lse.ac.uk/collections/law/wps/WPS2012-07_Collins.pdf&gt; accessed 25 October 2016.

[15]Ananth Padmanabhan, ‘Rights: Breadth, Scope, and Applicability’ in Sujit Choudhry, Madhav Khosla, and Pratap Bhanu Mehta (eds) The Oxford Handbook of the Indian Constitution ch 32.

[16] ibid.

[17]R.D. Shetty v International Airport Authority of India AIR 1979 SC 1628.

[18]Unnikrishnan v State of A.P. A.I.R. 1993 SC 2178.

[19]Zee Telefilms v Union of India AIR 2005 SC 2677.

[20]Gautam Bhatia, ‘What is the State – V: Zee Telefilms, the Death of the Functional Approach, and an Alternative’ (Indian Constitutional Law and Philosophy, 19 August 2014)

<https://indconlawphil.wordpress.com/2014/08/19/what-is-the-state-v-zee-telefilms-the-death-of-the-functional-approach-and-an-alternative/&gt; accessed 15 October 2016.

[21] ibid.

[22]Pradeep Kumar Biswas and Ors.v Indian Institute of Chemical Biology and Ors.(2002) 5 SCC 111; Zee Telefilms v Union of India AIR 2005 SC 2677.

[23]Gautam Bhatia, ‘What is the State – V: Zee Telefilms, the Death of the Functional Approach, and an Alternative’ (Indian Constitutional Law and Philosophy, 19 August 2014)

<https://indconlawphil.wordpress.com/2014/08/19/what-is-the-state-v-zee-telefilms-the-death-of-the-functional-approach-and-an-alternative/&gt; accessed 15 October 2016.

[24]Unnikrishnan v State of A.P. A.I.R. 1993 SC 2178.

[25]Zee Telefilms v Union of India AIR 2005 SC 2677.

[26]Gautam Bhatia, ‘What is the State – V: Zee Telefilms, the Death of the Functional Approach, and an Alternative’ (Indian Constitutional Law and Philosophy, 19 August 2014)

<https://indconlawphil.wordpress.com/2014/08/19/what-is-the-state-v-zee-telefilms-the-death-of-the-functional-approach-and-an-alternative/&gt; accessed 15 October 2016.

[27] ibid.

Authored By:-

Siddhant Sachdeva – Student Ambassador

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s