2003 INSC 0475 SUPREME COURT OF INDIA Kapila Hingorani Versus State of Bihar 9.5.2003 (V.N. Khare, CJ and S.B. Sinha, J. ) Writ Petition (C) No. 488 of 2002. V.N. Khare, CJ. - If at all and to what extent the Government of the State of Bihar is vicariously liable for payment of arrears of salaries to the employees of the State owned corporations, public sector undertakings or the statutory bodies is the core question involved in this writ petition. 2. It appears from the records that various Government companies/public sector undertakings details whereof are stated hereunder have not paid salaries to their workmen and other employees for a long time resulting in death of several persons and miseries brought to a large number of families as would appear from the following : Statement as of 12.3.2003 D Bi Bi Bi In Bih Fr Bi Bi In In Bi Bi Fro A ha ha ha H ar o ha B ha He H ha ha m Tr r r ea Sta m r 4 i r ad Bi ea Bi r r Au NA E No St St St dq te Bi Ja St 7 h St qu ha dq ha St St g. ME F s. ate ate at ua Sm ha nu ate 1 a ate art r ua r ate ate 94 OF N R OF A M e rte all r ar Le F r In ers St rte St Fil Fr TH O. O D gr ed H r Sca St y at r F du fr at r at m uit 1 SE O ME o M ici A an fr le at 20 he o i str o e up e N De A an F AT In a ne u dl o Ind 1 e 900 r m El to Va o ve u d I PU n ial 1m 12. E WH 1du 6 72an 2 13oo 4m 4ust S 2in 46De 6 3715 5Jul 1 ec 1da 9str 5vN1lo g N1Ve 1 . BL y g 935 1is 8 M H OF .str 3 6 2M 3.rial ug 6.ve Ma 2 tr 5te. 5 i0p 8 i1get 6Bih NIC - 0.d - 1.m 96. 4H 3h 5.51 5y . .ay 0. - OUN PL I E 0 5 an 9ay De 3 ar 0ea 7lo a . De 120 5on 7in a 9l.m 0 l.abl ar ies 9 Ch 9 e . DE O C M De 3 e 3 d 19 vel C dq p r d ve 01 ic U C 6 en 2 e Stat RT Y H PL ve mi H 96 op or ua m c L lo in C nit or t E De e AK SO cal an in me po rte en h e p U or fr po an vel See lo IN E A Y p De di U nt ra r. t 1 at m nit po o rat d op d G L EE m ve cr nit Co ti In Co 9 h en fr rat m io Fi me De A S en lo af fr rpo on U rp 9 e t o io A n na nt vel nit or 3 rs Co m n pr R t p t o rati nc Co op Y Co m C m on fr ati rp Fe il ial rp me I rp en or 19 14 o on or b. 19 Co or nt S or t po 93 1, m ati 19 98 rp ati Cor on 93 D ati Co ra In A or on por U on rp ti He pri ati atio E or on adq l on n ati uar 19 on ter 92 137 fro m Fro m Ap Ma y ril 199 9 19 95. In Un 5 it fro 13. m Ap Bih ar ril Stat e Fis heri es De vel op me nt Cor por atio n 42 Bef ore Ma y 200 0 due of 32 to 40 mo nth s 5 14. Bih ar Stat e Foo d and Civ il Sup plie s Cor por atio n 171 6 Pen din g fro m till 40 mo nth s 325 15. Bih ar Stat e Pan cha yati Raj Fin anc ial Cor por atio n 130 Fro m Ma rch 199 6 7 16. Bih ar Stat e Co nstr ucti on Cor por atio n 657 In Hea dqu arte r fro m Jan uar y 199 5. In Uni t fro m Jan uar y 199 2 55 17. Bih ar Stat e Roa d Tra nsp ort Cor por atio n 558 0H ead qua rter + In su m unit s fro m No v. 199 8 Bal anc e in fro m Dec em ber 199 3 Not e: 205 18. Bih ar Stat e Kh adi Gra md hoy og Boa rd Cor por atio n 75 Pay me nt of Sal arie s 71 Staf f in non - pla n (upt o dat e) due fro m Apr il 94 Staf f Sal arie s NA 19. Bih ar Hill Are a Lift Irri gati on Cor por atio n 684 NA 3. A newspaper report as regard non-payment of salary for a long time resulting in starvation highlighted the case of one Chandan Bhattacharya, son of an employee of the Bihar State Agro- Industries Development Corporation who tried to immolate himself. The incident was widely reported, inter alia, in `The Hindustan Times', Delhi Edition, on 19.9.2002 under the caption "Empty coffers drive staff to self-immolation bids'. The said Chandan Bhattacharya later on succumbed to the burn injuries suffered by him. 4. In this writ petition, the writ petitioner, a public spirited citizen and a Supreme Court lawyer, alleged that apart from plight of the employees of the public sector undertakings or the statutory authorities, even the teaching and non-teaching staff of Aided and Unaided Schools, Madrassas and Colleges have been facing a similar fate. We, however, as at present advised do not intend to deal with the same. According to the petitioner, from a newspaper report it would appear that about 250 employees died due to starvation or committed suicide owing to acute financial crisis resulting from non-payment of remunerations to them for a long time. The report further goes on to say that the leader of the opposition in the Bihar Assembly had alleged that over 1000 employees died "due to lack of salary for a period ranging from four months to 94 months". 5. In its counter affidavit, the State of Bihar does not deny about the factual statement made in the said writ petition. Its stand, however, is that salaries are being paid by the statutory authorities, the details whereof are in the following terms : "In the following 26 undertakings, salary payments are upto date (as on 30.9.2002) and are continuing on a regular basis as per reports from the Corporation :- Bi Bi B ha Bi Bi B ha No Da ih Bi r ih Bi B M ar ha Bi ha ha Bi r Bi rth rb Da St ar Bi ha i Bi Pa uz Bh St r ha r r Bi ha St ha Bi ha rb Bi at S ha r h B har tna Pa aff Ga ag at St r St St ha r ate r ha ng ha ha e ta r St a ih Sta In tna ar ya alp e at St at ate r St Po St ra ng r Te Cr te St ate r ar te du Re pu Re ur W e at e Fo St ate lic ate In In a St nu ed P at Mi S St Hy str gi r gi Re at M e A res ate To e Br du du Re ate gh it ol e ne ta at dro ial on Re on gi er in Fi gr t W uri Bu id str str gi Ex at an lu Te ral te e - Ar al gi al on a or na ic De ar sm ild ge ial ial on po Vi d ti 1 1 1xt 1s 1H 1 1 1El 1ele 1ea 2 2 2De 2on 2 2De 2al 2n 2iti 2 3 5nc 6 7ul 8ve 9 eh De in Co Ar Ar al rt dy In o 0 1 2B 3De 4o 5 6 7ec 8ctri 9De 0 1 2vel 3al 4 5vel 6De 7d 8es 9 0 .ial . .tu .lo . ou vel g nst ea ea De Co ut ve n . . .oo .vel .u . . .tri .c .vel . . .op .De . .op .vel .S .Fi . . C re p sin op Co ru De De vel rp Co st C k op si ci Po op me vel me op e na or M m g me nst cti vel vel op or rp m o C me n ty we me nt op nt me w nc po ar en Co nt ru on op op me ati ora en nt or nt g B r nt Au me Au nt er e rat ke t rp Co cti Co me me nt on tio t r po Co B o Co Au th nt th Au a C io ti Co or rp on rp nt nt Au , n." C ol rat rp o ar rpo th ori Au ori th g or n ng rp ati or Co or Au Au th an or B io or a d rati ori ty th ty ori e po Lt B or on ati rp ati th th ori d po o n ati r on ty ori ty B rat d. oa ati on or on ori ori ty rat ar on d ty o io rd on ati ty ty io d ar n on n d 6. As regards the Bihar State Road Transport Corporation, it contended that 50% of salary was paid to the employees as directed by this Court in Civil Appeal No. 7290 of 1994. The State contends that with a view to clear the dues, the Corporation would require approximately a sum of Rs. 160.35 crores. 7. However, in relation to the 16 Undertakings, according the State, the financial implication would be as under : SNA N S AP D C Bi 4 MR N Bi AR - Bi HR 5 Bi HR Bi 9HRI B MRA Bi 1HR B 1HQRs N-do- IM O. A PR E A 3ha 7 a s Not 3har 2us Nd3ha 4qs 2f 3ha 1Qs NN3ha 2Qs l 3i 6as s 3ha 5Qs NN4ih E O L O A U 3r 1 r . iA 4Sta 6g. io5r 2r . 3r 6r 4 . iA7r 4 . 4l 8h 3y. 1i 9r 5- . iA0ar 5 . i41. NOF F A XI T S .St + c 6lp .te 5. 9l-.St 9s 1 o .St 1A1l .St 0J 1 n.a 0 6 n.St 1J 6l .St 7u2l OUN E R M H E at 2 h2 pl Ph 9. at - 8 m at p 8 at a3 e r ' 0 at u 1 at p. Bihar . DE M Y AT S O e 5 . ic ar 34 e M er e n0 s S 9. p e l . e 5 State H ac il S . c S s t 37 a In y 7 El D1 Textile RT PL D E R F Le 9 14 a ma 6 an yr l m 9 r u ' c a 3 r du ' 2 ec a Corpor dl o n al 4 o ga 0r t a s. 0 tr t c ation AK O U A E D at i 95 bl ce oo 1r e l r r 0o e c Tr 1 c o er m 9e s In Ue C r A r I ial Ur ni Uo 50 IN Y E M P E he n 9 e uti c Po 9s s d. n s or Ue g o I D n o cs nr w 6 ,, C i p ns r r I ev it r D i e Nov.,, G E S O O A r B3C cal r erl R or t or i o e a el s e e t s 96 oo U e p s at t I s b op F s v. s ES I U R T In i r s o m n s or A io s n o m e C A Rs. an i t at p n A d v en b or p 0.70 N NT T H du h o an r d t n io r p r crores H s on i p . et . n. i Nil C IN E A str a r d e an 1 t l r D C9 di 9 r , i e or 3 l E V D S ie r e Ch s cr 9 e , l v pn , -do- aft 3 p 9 9. . ` OL B R s F s em s o3 2C 9 42. D rt 8 VE Y E D i ica ev e o el d r Bihar D C P ev n ls op p State m n Film O O el i De en . Dev. t and R R op s vel C Fin. or Corpn. P T mh op po rat 08 N. E en e me io n Aug.,, Dt d nt 02 CL Co Rs. 55,000 or e rp /- per month po a ora rat t tio io h n ne r Nil -do- 43. Bihar State Fruits and Vegeta ble Dev. Corpn. 16 Aug.,, 94 Rs. 1.0805 6 crores Nil -do- 44. Bihar State Seeds Dev. Corpn. 137Ma y,, 99 Rs. 4.53 crores 5 Inadeq uate Medic al Treatm ent 45. Bihar State Fisheri es Develo pment Corpor ation 42 32-40 months upto March, , 00 Update from March, 00 Rs. 1 crore Nil NA 46. Bihar State Food and Civil Suppli es Corpor ation 1716 Upto 40 months Rs. 16.56 crores Nil -do- 47. Bihar State Pancha yati Raj Financ e Corpor ation 130 Mar 96 Rs. 3.75 crores Nil -do- 48. Bihar State Constr uction Corpor ation 657 HQ Jan,, 1995 Unit Jan,, 1992 Rs. 37.50 crores Nil -do- 49. Bihar Hill Area Lift Irrigati on Corpor ation> 684 Being Collect ed Being Collect ed Nil -do- 8. The State accepts that althou gh the Manag ing Direct or of the Bihar State Small Industr ies Corpor ation had initiall y reporte d that 14 of its emplo yees died in harnes s and 9 after retirem ent, but in the subseq uent report the Manag ing Direct or stated that there is no report regardi ng suicide or death due to starvati on of any of the emplo yees of the Corpor ation. It is averre d: "... The Manag ing Direct or of the Bihar Pancha yati Raj Financ e Corpor ation had initiall y reporte d that 3 emplo yees of the Corpor ation had died, but had not given any details about the date and cause of their deaths. In his subseq uent report the Manag ing Direct or reporte d that there was no report regardi ng the suicide or death due to starvati on of any emplo yee of the corpor ation. The Manag ing Direct or of the Bihar State sugar Corpor ation had initiall y reporte d that 4 emplo yees of the Corpor ation had died for want of proper treatm ent. In this subseq uent report the Manag ing Direct or has reporte d that the emplo yees' Union has submit ted a list of 251 emplo yees who have died or becom e disable d. Simila rly, the Compa ny Secreta ry of the Bihar State Seeds Corpor ation had initiall y reporte d that 4 emplo yees of the Corpor ation have died during the period when salary was not paid. Subseq uently, the Compa ny Secreta ry had reporte d that 5 emplo yees of the Corpor ation have died for want of proper treatm ent. Howev er, in view of the discrep ancy in the two reports of these corpor ations, the concer ned manag er Direct ors have been asked to make a throug h investi gation into the causes of these deaths and to submit detaile d reports in the matter. I say that the emplo yees Union of the Bihar Handlo om, Powerl oom and Handic rafts Develo pment Corpor ation has submit ted to the Manag ing Direct or of the Corpor ation a list of 7 emplo yees and 2 wives of emplo yees who have died. The cause of death of 4 emplo yees has not been specifi ed, while 3 emplo yees and 2 wives of emplo yees are stated to have died due to financi al hardshi p. The Manag ing Direct or of the corpor ation has reporte d that no case of suicide or starvati on death by emplo yees of their depend ents have been reporte d to the Corpor ation but the submis sions of the emplo yees union is being verifie d. The Manag ing Direct or has been asked to make a thorou gh investi gation into the causes of these deaths and to submit a detaile d report in the matter. " 9. The records of this case bear out the details had occurr ed owing to starvati on or malnut rition. The fact that the emplo yees have not been paid their salarie s for a long time; in some cases for a decade or more; stands admitt ed. 10. The Affida vit of the State of Bihar, purpor ted to have been based on reports of the Manag ing Direct or of some Undert aking does not inspire confid ence. The statem ents made therein are self- contra dictory and inconsi stent. It smacks of lack of bonafi de and is full of afterth oughts. 11. The stand of the State of Bihar on law is that having regard to the fact that most of the undert akings or compa nies are registe red or incorp orated under the Indian Compa nies Act, 1956, the rights and liabiliti es of the shareh olders would be govern ed by the provisi ons of the said Act and the liabilit y of the said compa nies cannot be passed on to the State by taking recours e to the doctrin e of `lifting the veil' or otherw ise. 12. Keepin g in view the comple xity of the matter, this Court appoin ted Shri P.S. Mishra ,a senior counse l of this Court, as amicus curiae. Shri Amare ndra Sharan also assiste d the court. 13. The learned amicus curiae has, inter alia, submit ted that the indepe ndent investi gation reveale d that the head offices of the Gover nment Compa nies are situate d in rented premis es. It was conten ded that all shares are owned by th State and in some of the cases only one share had been allotte d in the name of the nomin ee of the Gover nment of the State of Bihar. The allegati ons of the writ petitio ner to the effect that there had been starvati on deaths and/or suicide by the emplo yees of the public sector undert akings are correct . 14. Mr. Shanti Bhush an, learned senior counse l appeari ng on behalf of the State of Bihar, would submit that having regard to the magnit ude of the proble m, it would be just and proper if liabilit y is directe d to be met to the extent of 80 per cent by the Union of India and that the State Gover nment will bear the burden to the extent of 10 per cent thereof and the remain ing may be realise d from the sale of propert ies belong ing to the respect ive compa nies. The learned counse l would submit that pursua nt to or in further ance of a decisio n of the Full Bench of the Patna High Court in C.W.J. C. No. 5015 of 1996, liquida tion procee dings of the Gover nment compa nies have been initiate d and they are pendin g before the Compa ny Judge of the Patna High Court. Mr. Shanti Bhush an would urge that having regard to the well- settled princip le of law that a compa ny registe red under the Indian Compa nies Act is a juristic person, its rights and liabiliti es must be determ ined in terms thereof and nod de'hors the same. Strong relianc e, in this behalf, was placed on Steel Author ity of India Ltd. and others v. Nation al Union Waterf ront Worke rs and others, 2001(7 ) SCC 1 and Electr onics Corpor ation of India Ltd. and others v. Secret ary, Reven ue Depart ment, Govt. of Andhr a Prades h and others, 1999(4 ) SCC 458. 15. Mr. Soli J. Sorabj ee, the learned Attorn ey Genera l appeari ng on behalf of Union of India submit ted that neither in law nor in equity the Union of India can be fastene d with any liabilit y of the State. The learned counse l would conten ded that this Court, with a view to do justice to the parties, may direct that an official liquida tor be appoin ted in respect of all the compa nies and the learned compa ny judge may further be directe d to dispos e of the windin g up applica tions as expedit iously as possibl e wherei n having regard to the provisi on contain ed in Sectio n 598A of the Compa nies Act the dues of emplo yees will have primac y. Mr. Sorabj ee would urge that the learned Compa ny Judge may also be directe d to look into the Human Right aspect of the matter. 16. Mr. Mishra , learned amicus curiae, would submit that there is no reason as to why the burden of the State should be shifted to the Union of India and having regard to the provisi ons of Article s 21 and 23 of the Constit ution of India, this Court is entitle d to pierce the corpor ate veil of the Gover nment compa nies which are `States' within the meanin g of Article 12 of the Constit ution of India. Accord ing to Mr. Mishra , it is beyond any cavil of doubt that the State for all intent and purpor t was the sole shareh older of those compa nies and as such it cannot escape its liabilit y having regard to the fact that it had deep and pervasi ve control includi ng financi al control over the affairs of the said compa nies. Nr. Mishra would urge that as indispu tably the corpor ations owned and control led by the State of Bihar are `State' within the meanin g of Article 12 of the Constit ution of India, neither they nor the State of Bihar can escape their liabilit y from enforci ng the rights of the citizen s of India under Article s 21 and 23 of the Constit ution of India. 17. Mr. Mishra would submit that th Full Bench of the Patna High Court has referre d to certain decisio ns of this Court which did not deal with an issue of this nature nor it look notice of differe nt facts of Article 21 of the Constit ution of India which would include a right to food, shelter and other basic amenit ies. Non- payme nt of lawful salary to the emplo yees, Mr. Mishra would submit , would fall within the definiti on of `forced labour' which is prohibi ted by Article 23 of the Constit ution of India. In suppor t of his content ions, Mr. Mishra placed strong relianc e on People' s Union for Democ ratic Rights and others v. Union of India and others, 1982(3 ) SCC 235, Board of Truste es of the Port of Bomba y v. Dilipk umar Raghv endran ath Nadka rni and others, 1983(1 ) SCC 124 and Olga Tellis and others v. Bomba y Munic ipal Corpor ation and others, 1985(3 ) SCC 545. 18. Ms. Hingor ani, the petitio ner appeari ng in person, would conten d that the State cannot escape its liabilit y in the matter of payme nt of salarie s to its own emplo yees, althou gh ostensi bly they are workin g in the compa nies incorp orated under the Indian Compa nies Act. 19. Accord ing to the petitio ner starvati on death and/or commi ssion of suicide by the emplo yees of the State owned corpor ation being admitt ed, this Court should issue interim directi ons for payme nt of salarie s to the emplo yees. Ms. Hingor ani would conten d that the Gover nment compa nies or corpor ations will have to dischar ge their constit utional obligat ions in terms of Article 21 of Constit ution of India. In suppor t of the said content ion, relianc e has been placed on Andhr a Prades h State Road Transp ort Corpor ation v. The Incom e Tax Officer and anr., 1964(7 ) SCR 17, Wester n Coalfi elds Ltd. v. Specia l Area Develo pment Author ity, Korba and anr., 1982(2 ) SCR 1, Hem Chand etc. v. The Delhi Cloth and Gener al Mills Co. Ltd. and anothe r etc., 1977(3 ) SCC 483 and Som Prakas h Rekhi v. Union of India and anothe r, 1981(2 ) SCR 111. 20. The case at hand poses a large numbe r of comple x questio ns such as :- 1. Wheth er in a case of this nature, the Court would take a sheer legalist ic approa ch in holdin g that the corpor ate veil would not be lifted althou gh its consci ence stands satisfie d that there has been violati ons of citizen s' right to life and liberty as adumb rated under Article 21 of the Constit ution of India ? 2. Wheth er having regard to the admitt ed positio n that the Gover nment Compa nies or Corpor ations referre d to herein before are States within the meanin g of Article 12 of the Constit ution of India, the State of Bihar having deep and pervasi ve control over the affairs thereof can be held to be liable to render all assista nce to the said compa nies so as to fulfill its own and/or corpor ations obligat ions to compl y with the citizen s' right under Article s 21 and 23 of the Constit ution of India ? 3. Wheth er the State of Bihar can escape its liabilit y having regard to the human rights proble m involv ed in the matter ? 4. Wheth er in a case of this nature the liabilit y of the State of Bihar, if any, can be shifted to the Union of India? 21. A Compa ny incorp orated under the Compa nies Act is a juristic person. A compa ny indispu tably has a distinct and separat e entity vis-a- vis its shareh olders. 22. This Court in Electro nics Corpor ation of India Ltd.'s case (supra) opined : "A clear distinct ion must be drawn betwee na compa ny and its shareh older, even throug h that shareh older may be only one and that the Central or a State Gover nment. In the eye of the law, a compa ny registe red under the Compa nies Act is a distinct legal entity other than the legal entity or entities that hold its shares. " 23. Yet again, a Constit ution Bench of the Court in Steel Author ity of India's case (supra) noticed the followi ng decisio ns to hold that a compa ny incorp orated under the Compa nies Act being a juristic person would be govern ed by the Compa nies Act. : "In Rama na Dayar am Shetty v. Intern ational Airpor t of India (Rama na Dayar am Shetty v. Intern ational Airpor t Author ity of India, 1979(3 ) SCC 489 : 1979(3 ) SCR 1014 a three- Judge Bench of this Court laid down that corpor ations created by the Gover nment for setting up and manag ement of public enterpr ises and carryin g out public functio ns, act as instru mental ities of the Gover nment; they would be subject to the same limitati ons in the field of constit utional and admini strative laws as the Gover nment itself, though in the eye of the law they would be distinct and indepe ndent legal entities . There, this Court was enforci ng the mandat e of Article 14 of the Constit ution against the respon dent - a Central Gover nment corpor ation. Manag ing Direct or, U.P. Wareh ousing Corpor ation v. Vijay Naray an Vajpay ee, 1980(3 ) SCC 459 : 1980 SCC (L&S) 453 L 1980(2 ) SCR 773 dealt with a case of dismis sal of the respon dent emplo yee of the appella nt Corpor ation in violati on of the princip les of natural justice. There also the Court held the Corpor ation to an instru mental ity of the State and extend ed protect ion of Article 14 and 16 of the Constit ution to the emplo yee taking the view that when the Gover nment is bound to observ e the equalit y clause in the matter of emplo yment the corpor ations set up and owned by the Gover nment are equally bound by the same discipli ne. In Ajay Hasia v. Khalid Mujib Sehrav ardi (Ajay Hasia v. Khalid Mujib Sehrav ardi, 1981(1 ) SCC 722 : 1981 SCC (L&S) 258 : 1981(2 ) SCR 79 the questio n decide d by a Constit ution Bench of this Court was : whethe r Jammu and Kashm ir Region al Engine ering Colleg e, Srinag ar, registe red as a society under the Jammu and Kashm ir Registr ation of Societi es Act, 1898, was "State" within the meanin g of Article 12 of the Constit ution so as to be amena ble to writ jurisdi ction of the High Court. Having examin ed the memor andum of associa tion and the Rules of the Societ y, the Court decide d that the control of the State and the Central Gover nment was deep and pervasi ve and the Societ y was a mere project ion of the State and the Central Gover nment and it was, therefo re, an instru mental ity or agency of the State and the Central Gover nment and as such an authori ty- State within the meanin g of Article 12. The princip le laid down in the aforem entione d cases that if the Gover nment acting throug h its officer s was subject to certain constit utional limitati ons, a fortiori the Gover nment acting throug h the instru mental ity or agency of a corpor ation should equally be subject to the same limitati ons, was approv ed by the Constit ution Bench and it was pointe d out that otherw ise it would lead to consid erable erosion of the efficie ncy of the funda mental rights, for in that event the Gover nment would be enable d to overrid e the funda mental rights by adopti ng the stratag em of carryin g out its functio n throug h the instru mental ity or agency of a corpor ation while retaini ng control over it. That princip le has been consist ently follow ed and reiterat ed in all subseq uent cases - see Delhi Transp ort Corpn. v. D.T.C. Mazdo or Congr ess, 1991 Supp (1) SCC 600 : 1991 SCC (L&S) ) 1213, Som Prakas h Rekhi v. Union of India, 1981(1 ) SCC 449 : 1981 SCC (L&S) 200, Manm ohan Singh Jaitla v. Comm issione r, Union Territo ry of Chand igarh, 1984 Supp SCC 540 : 1985 SCC (L&S) 269, P.K. Ramac handr a Iyer v. Union of India, 1984(2 ) SCC 141 : 1984 SCC (L&S) 214, A. L. Kalra v. Project and Equip ment Corpn. of India Ltd., 1984(3 ) SCC 316 : 1984 SCC (L&S) 497, Centra l Inland Water Transp ort Corpn. Ltd. v. Brojo Nath Gangu ly (Centr al Inland Water Transp ort Corpn. Ltd. v. Brojo Nath Gangu ly, 1986(3 ) SCC 156 : 1986 SCC (L&S) 429 : 1986(1 ) ATC 103, C. V. Rama n v. Bank of India (C.V. Rama n v. Bank of India, 1988(1 ) SCC 105 : 1988 SCC (L&S) 687), Luckn ow Develo pment Author ity v. M.K. Gupta, 1994(1 ) SCC 243, Star Enterp rises v. City and Indust rial Develo pment Corpn. of Mahar ashtra Ltd., 1990(3 ) SCC 280, LIC of India v. Consu mer Educat ion and Resear ch Centre , 1995(5 ) SCC 482 and G.B. Mahaj an v. Jalago n Munic ipal Counc il, 1991(3 ) SCC 91. We do not propos e to burden this judgm ent by adding to the list and referri ng to each case separat ely. We wish to clear the air that the princip le, while dischar ging public functio ns and duties the govern ment compa nies/co rporati ons/so cieties which are instru ment abilitie s or agenci es of the Gover nment must be subject ed to the same limitati ons in the field of public law - constit utional or admini strative law - as the Gover nment itself, does not lead to the inferen ce that they becom e agents of the Centre/ State Gover nment for all purpos es so as to bind such Gover nment for all their acts, liabiliti es and obligat ions under various Central and/or State Acts or under private law. (Emph asis supplie d) 24. Thus, the law as stated therein is not of univers al applica tion. The ratio of the said decisio ns must be applied having regard to the fact situatio n obtaini ng therein (See Bhavn agar Univer sity v. Palita na Sugar Mill (P) Ltd. and others, 2003(2 ) SCC 111 - (Para 59)). It has its limitati ons in its applica tions, as excepti ons exist in several areas. 25. It is now well- settled that the corpor ate veil can in certain situatio ns be pierced or lifted. The princip les behind the doctrin e is a changi ng concep t and it is expand ing its horizo n as was held in the State of U.P. and others v. Renus agar Power Compa ny and others, 1988(4 ) SCC 59. The ratio of the said decisio n clearly sugges ts that whene ver a corpor ate entity is abused for an unjust and inequit able purpos e, the court would not hesitat e to lift the veil and look into the realitie s so as to identif y the person s who are guilty and liable therefo r. 26. The propos ition that a compa ny althou gh may have only one shareh older will be distinct juristic person as adumb rated in Salom on v. Salom on and Co., 1897 AC 22, has time and again been visited the applica tion of doctrin e of lifting the corpor ate veil in revenu e and taxatio n matters . (See Dal Chand and others v. Comm issione r of Incom e Tax, Punja b, 1944(1 2) ITR 458 and Juggil al Kamla pat v. Comm issione r of incom e Tax, U.P., 1969(1 ) SCR 988 : 1969(7 3) ITR 702. 22. The corpor ate veil indispu tably can be pierced when the corpor ate person ality is found to be oppose d to justice, conven ience and interest of the revenu e or workm an or against public interest . (See C.I.T. Madra s v. The Meena kshi Mills Ltd. and others, 1967(1 ) SCR 934); Work men Emplo yed in Assn. Rubbe r Indust ry Ltd, Bhavn agar v. Associ ated Rubbe r Indust ry Ltd., Bhavn agar and anothe r, 1985(4 ) SCC 11; New Horizo ns Ltd. and anothe r v. Union of India and others, 1995(1 ) SCC 478; State of U.P. and others v. Renus agar Power Co. and others, 1988(4 ) SCC 59; Hussai nbhai, Calicu t v. The Alath Factor y Thezih ilali Union, Khozhi kode and others, 1978(4 ) SCC 257 and Secret ary H.S.E. B. v. Suresh and others, 1999(3 ) SCC 601. 28. The test that a public sector undert aking or Gover nment compa ny can be a `State' within the meanin g of Article 12 of the Constit ution, only when it dischar ges some soverei gn functio ns, has been given a go-bye by this Court in a recent decisio n in Pradee p Kumar Biswas v. Indian Institu te of Chemi cal Biolog y and others, 2002(5 ) SCC 111. Disagr eeing with the decisio n of this Court in Sabhaj it Tewary v. Union of India and others, 1975(1 ) SCC 485, it was held that the premis es whereu pon the ratio of the said decisio n was based was not correct and follow ed the preced ents a like Sukhd ev Singh and others v. Bhaga tram Sardar Singh Raghu vanshi and anothe r, AIR 1975 SC 1331 and Ajay Husia and others v. Khalid Mujib Sehrav ardi and others, 1981(1 ) SCC 722. This Court further held that the decisio n in Chand er Moha n Khann a v. Nation al Counc il of Educat ional Resear ch and Traini ng and others, 1991(4 ) SCC 578 does not lay down the correct law. 29. We are not oblivio us of the legal propos ition as enunci ated in Raman a Dayara m Shetty and SAIL (supra) that even if a Gover nment compa ny is a State within the meanin g of Article 12 of the Constit ution of India as an agency or instru mental ity of the State, there does not exist a relatio nship of princip al or an agent and only the action of the said authori ties would be State action. 30. The Gover nment compa nies/pu blic sector undert akings being `States' would be constit utional ly liable to respect life and liberty of all person s in terms of Article 21 of th Constit ution of India. They, therefo re, must do so in cases of their own emplo yees. The Gover nment of the State of Bihar for all intent and purpor t is the sole shareh older. Althou gh in law, its liabilit y toward s the debtors of the Compa ny may be confin ed to the shares held by it but having regard to the deep and pervasi ve control it exercis es over the Gover nment compa nies; in the matter of enforc ement of human rights and/or rights of the citizen of life and liberty, the State has also an additio nal duty to see that the rights of emplo yees of such corpor ations are not infring ed. 31. The right to exercis e deep and pervasi ve control would in its turn make the Gover nment of Bihar liable to see that the life and liberty clause in respect of the emplo yees is fully safegu arded. The Gover nment of the State of Bihar, thus, had a constit utional obligat ion to protect life and liberty of the emplo yees of the Gover nment owned compa nies.co rporati ons who are the citizen s of India. It had an additio nal liabilit y having regard to its right of extensi ve supervi sion over the affairs of the compa ny. 32. In relatio n to statuto ry authori ty, the State had also the requisi te to issue necess ary directi ons which were bindin g upon them, as for exampl e, Sectio n 79(c) of Electri city (Suppl y) Act. 33. The State having regard to its right of supervi sion and/or deep and pervasi ve control , cannot be permitt ed to say that it did not know the actual state of affairs of the State Gover nment undert akings and/or it was kept in dark that the salarie s of their emplo yees had not been paid for years leading to starvati on death and/or commi ssion of suicide by a large numbe r of emplo yees. Conce pt of accoun tability arises out of the power conferr ed on an authori ty. 34. The State may not be liable in relatio n to the day to day functio ning of the Compa nies, but its liabilit y would arise on its failure to perfor m the constit utional duties and functio ns by the public sector undert akings, as in relatio n thereto the State's constit utional obligat ions. The State acts in a fiducia ry capacit y. The failure on the part of the State in a case of this nature must also be viewed from the angle that the statuto ry authori ties have failed and/or neglect ed to enforc e to social welfar e legislat ions enacte d in this behalf e.g. Payme nt of Wages Act, Minim um Wages Act etc. Such welfar e activiti es as adumb rated in Part IV of the Constit ution of India indispu tably would cast a duty upon the State being a welfar e State and its statuto ry authori ties to do all things which they are statuto rily obligat ed to perfor m. 35. In "The constit ution, social rights and liberal politic al justific ation". Frank I, Michel man, publish ed in Interna tional Journal of Constit utional Law, Volum e I, page 13, it is stated: "What ever else it may also be, a countr y's written constit utional bill of rights is a high- rankin g regulat ory law, a "statut e" fraught with direct legal conseq uences . Grante d, the constit ution may not be "simpl y" that. No doubt it may figure as someth ing beyond positiv e law : "a `mirror reflecti ng the nationa l soul"," perhap s; an expres sion of nationa l ideals, aspirati ons, and values expect ed, as such, to "presid e and permea te the proces ses of judicia l interpr etation and judicia l discreti on" throug hout the length and breadt h of the nationa l legal order. But had bills of rights not also an always registe red as direct, regulat ory legislat ion - as laws to be enforc ed like other laws - jurists and scholar s the world over would not have conduc ted their debate s over the constit utional ization of social rights in the terms that we have grown used to. Constit utions, to be sure, are regulat ory laws of special kind, setting terms and conditi ons for the makin g and executi on of all other laws. Typica lly, althou gh not necess arily, some of the terms and conditi ons are cast in the form of a bill of rights; a list of certain interest s of person s, upon whom are conferr ed what are consid ered to be legal rights, not just backgr ound moral claims, to have these interest s at least negativ ely respect ed, and maybe positiv ely secure d and redeem ed, by the state's legislat ure and other actions yet to come." 36. The power of the State in the sphere of exercis e of its constit utional power includi ng those contain ed in Article 298 of the Constit ution of India inheres in it a duty toward s public, whose money is being investe d. Article 298 of the Constit ution of India confers a prerog ative upon the State to carry on trade or busine ss. While doing so the State must fulfil its constit utional obligat ions. It must overse e protect ion and preserv ation of the rights as adumb rated in Article s 14, 19, 21 and 300-A of the Constit ution of India. 37. Even before India becam e indepe ndent, our leaders started thinkin g in terms of eradica tion of povert y and discri minati on as well as uplift of down- trodde n. At the time of framin g of the Constit ution, the Constit ution makers had before them the harrow ing tales of starvati on deaths and particu larly the infamo us Bengal famine . 38. If it is consid ered to be the duty of the citizen to remind himsel f of the aspirati ons of the Constit ution makers , the State, in our opinio n, cannot be permitt ed to say that it has no such duty toward s its own citizen s. 39. Clause s (a)(b) and (h) of Article 51-A of the Constit ution of India read as under : "Art. 51A. It shall be the duty of every citizen of India - (a) to abide by the Constit ution and respect its ideals and institut ions, the Nation al Flag and the Nation al Anthe m; (b) to cherish and follow the noble ideals which inspire our nationa l struggl e for freedo m. (c) to promot e harmo ny and the spirit of comm on brother hood among st all the people of India transce nding religio us; linguis tic and region al or section al diversi ties; to renoun ce practic es deroga tory to the dignity of women ;" 40. In its attemp t to interpr et a statute in the light of the constit utional schem e, this Court has time and again interpr eted a statute particu larly in the light thereof . [See A.I.I. M.S. Studen ts Union v. A.I.I. M.S. and others, 2002(1 ) SCC 428]. 41. The Univer sal Declar ation of Human Rights, 1948 enume rates at least 27 broad rights includi ng the right to life, freedo m from slavery and forced labour. The Protect ion of Human Rights Act, 1993 defines Human Rights to mean the rights relatin g to life, liberty, equalit y and dignity of the individ ual guaran teed by the Constit ution or embod ied in Interna tional Coven ant on civil and politic al rights and Interna tional Coven ant on Econo mic, Social and Cultur al Rights which were adopte d by the Genera l Assem bly of United Nation s on 16.12. 1966. The said Act was made by the Parlia ment "havin g regard to the changi ng social realitie s and growin g concer n in India and brough t about issues relatin g to Human Rights with a view to bring about greater accoun tability and transpa rency in enforc ement of laws of the nation. " 42. Parts III and IV of the Constit ution of India contain a large numbe r of rights which guaran tee human rights, some of which are akin to the rights enume rated in Interna tional Treatie s and Chapte rs. Article 11 of Interna tional Coven ant in Econo mic, Social and Cultur al Rights, 1966 reads thus : "1. The State Parties to the present Coven ant recogn ize the right of everyo ne to an adequa te standar d of living for himsel f and his family, includi ng adequa te food, clothin g and housin g, and to the contin uous improv ement of living conditi ons. The States Parties will take approp riate steps to ensure the realizat ion of this right, recogn izing to this effect the essenti al import ance of interna tional co- operati on based on free consen t. 2. The States Parties to the present Coven ant, recogn izing the funda mental right of everyo ne to be free from hunger , shall take, individ ually and throug h interna tional co- operati on, the measur es, includi ng specifi c progra mmes, which are needed . (a) To improv e metho ds of produc tion, conser vation and distrib ution of food by makin g full use of technic al and scientif ic knowle dge, by dissem inating knowle dge of the princip les of nutriti on and by develo ping or reform ing agraria n system s in such a way as to achiev e the most efficie nt develo pment and utilizat ion of natural resourc es;" 43. This Court in Chame li Singh and others v. State of U.P. and Anoth er, 1996(2 ) SCC 549 referri ng to Article 11 of the Interna tional Coven ant on Econo mic, Social and Cultur al Rights, 1966 held that the State parties recogn ize "the right to everyo ne to an adequa te standar d of living for himsel f and for his family includi ng food, clothin g housin g and to the contin uous improv ement of living conditi ons". Indisp utably, the State parties were to take approp riate steps to ensure realizat ion of this though t. 44. Justice Holme s expres sed the followi ng view in Misso uri v. Hollan d, 252 US 416(43 3): "When we are dealing with words that also are a constit uent act, like the Constit ution of the United States, we must realise that they have called into life a being the develo pment of which could not have been foresee n comple tely by the most gifted of its begette rs. It was enough for them to realise or to hope that they had created an organis m, it has taken a centur y and has cost their succes sors must sweat and blood to prove that they created a nation. The case before us must be consid ered in the light of our whole experie nce and not merely in that of what was said a hundre d years ago." 45. Justice Frankf urter elucida ted the interpr etive role in "Some Reflect ions on the Readin g of Statute s" : "There are varyin g shades of compu lsion for judges behind differe nt words, differe nces that are due to the words themse lves, their setting in a text, their setting in history . In short, judges are not unfette red glossat ors. They are under a special duty not to overe mphasi ze the episodi c aspects of life and not to underv alue its organi c proces ses - its contin uities and relatio nships" . 46. In Jagdis h Saran and others v. Union of India, 1980(2 ) SCC 768,it is stated : "Law, constit utional law, is not an omnip otent abstrac tion or distant idealiz ation but a princip led, yet pragm atic, valued -laden and result- oriente d, set of propos itions applica ble to and conditi oned by a concret e stage of social develo pment of the nation and aspirati onal impera tives of the people. India Today - that is the inartic ulate major premis e of our constit utional law and life." 47. It is also well- settled that a statute should be interpr eted in the light of the Interna tional Treatie s and Conve ntions. In Chair man, Railwa y Board and others v. Mrs. Chand rima Das and others, AIR 2000 SC 988 = 2000(2 ) SCC 465 this Court stated the law thus :- "24. The Interna tional Coven ants and Declar ations as adopte d by the United Nation s have to be respect ed by all signato ry States and the meanin g given to the above words in those Declar ations and Coven ants have to be such as would help in effecti ve imple mentat ion of those rights. The applica bility of the Univer sal Declar ation of Human Rights and the princip les thereof may have to be read, if need be, into the domest ic jurispr udence ." 48. In `Huma n Rights and Indian Values' Justice M. Rama Jois noticed the Ancien t Indian Texts in the followi ng words : SAMA NI PRAP A SAHA VONN BHAG A SAMA NE YOKT RAY SAHA WO YUNI SM ARAH NABH IMIVA BHIT E: "All have equal rights in articles of food and water. The yoke of the cariot of life is placed equally on the should ers of all. All should live togethe r with harmo ny suppor ting one anothe r like the spokes of a wheel of the chariot connec ting its rim and the hub. (Athar vanave da- Samjn ana Sukta) ". 49. Thus, the right to equalit y of all human beings has been declare d in the Vedas, which are regard ed as inviola ble. In order to empha size the dignity of the individ ual, it was said that all are brother s as all are the childre n of God. No one is inferio r or superio r. Simila rly, the Atharb vanved a stresse d that all have equal right over natural resourc es and all were equally import ant like spokes in a wheel. Both the Rigved a and Atharv anaved a declare d that co- operati on betwee n individ uals is necess ary for happin ess and progre ss. It is also of utmost import ance to note that right to equalit y was made a part of "Dhar ma" long before the State came to be establi shed. 50. It is equally interest ing to refer to the content s of Article s 1 and 7 of the Univer sal Declar ation of Human Rights (1948), whcih read : "All human beings are born free and equal dignity and rights. They are endow ed with reason and consci ence and should act toward s one anothe r in a spirit of brother hood." "All are equal before law and are entitle d withou t any discri minati on to equal protect ion of the law. All are entitle d to equal protect ion against any discri minati on in violati on of this Declar ation and against any incite ment to such discri minati on". 51. This declara tion is similar to the declara tion of equalit y made in the Rigved a. 52. After the establi shment of the State, the obligat ion to protect the right to equalit y was cast on the Rulers. It was made a part of the Rules of Raja Dharm a, the Constit utional Law. YATH A SWAR IN BHUT ANI DHAR A DHAR YATE SAMA M TATH A SWAR IN BHUT ANI BIBH ARTE PART HIVM VART AM "Just as the mother earth gives equal suppor t to all the living beings, a king should give suppor t to all withou t any discri minati on" (Manu IX 31) This also meant that the kings were require d to afford equal treatm ent to all the citizen s in the same manne r in whcih a mother treats all her childre n" 53. Prof. Upend ra Baxi in his book entitle d. `The Future of Human Rights' stated : "The proces ses of globali zation, thrivin g upon the heavily critque d ideolo gies of develo pmenta lism and its eventu al demise , seek to reprod uce the soft state. That notion is, howev er, now reconst ructed in several import ant ways. the `progr essive state', at least in, and for, the South, is now concei ved not as a state in its interna l relatio ns with its own people but in relatio n to the global comm unity of foreign investo rs. A progre ssive state is one that is a good host state for global capital against politic al instabil ity and market failure s. A progre ssive state is one that represe nts accoun tability not so much directl y to its people s, but to the World Bank and Interna tional Monet ary Fund. A progre ssive state is one that instead of promot ing world visions of a just interna tional order learns the virtues of debt repay ment on schedu le. Finally ,a progre ssive state is one that gleans concep tions of good govern ance neither from the histori es of struggl es against coloniz ation and imperi alism nor from its interna l social and human rights move ments but from the global institut ional gurus of globali sation. 54. The constru ction of `progr ess' is animat ed by a post- Fukuy ama world in whcih there is no Other to Capital ism, writ globall y large. Of course, the contra diction s betwee n democ racy and capitali sm are once again, recogn ized, but these two are reconst ructed, for exampl e, as follow s: War against hunger gets transfo rmed in the 1998 Rome Declar ation on the Right to Food into the free market oriente d state and interna tional manag ement of food securit y system ; The struggl e against homele ssness and for shelter, in the 1998 United Nation s Social Summi t at Istanbu l, becom es a series of mandat es for the constru ction industr ies and urban develo pers; `Sustai nable develo pment', becom es an instru ment of policy for the promot ion and protect ion of corpor ate govern ance practic es of `green washin g'; The UNDP inspire d `mains treami ng' of human rights `missio n' envisa ging the raising of a billion dollars for the Global Sustain able Develo pment Facilit y has already been subscri bed to by way of seed money by some of the most egregi ous multin ational enterpr ise corpor ate human rights offend ers." 55. In the 12 Misco nceptio ns About the Right to Food (FIAN ) it is inter alia stated : "What does the Right to Food mean? Can be existen ce of this Right cause lazines s among people ? The Right to Food is about respect ing, protect ing and fulfilli ng access to food produc ing resourc es and work. Theref ore, the Right to Food doesn't make people lazy but busy, enablin g them to feed themse lves. Would the Right to Food be asking for too much from the govern ment, and advoca ting for big govern ment? The Right to Food in th context of Human Rights doesn't mean tha the state is a super- entrepr eneur determ ining and carryin g out econo mic activiti es determ ining and carryin g out econo mic activiti es accordi ng to its own wisdo m. It means the Right to Feed Onesel f, which empha sizes dignity and self- relianc e, very differe nt from comma nd econo mics of big govern ment. Does the Right to Food require a mortal revolut ion of society , allowi ng human rights to becom e the founda tion of interpe rsonal ethics? The Right to Food does require a moral revolut ion. Howev er, this moral revolut ion does not concer n interpe rsonal ethics, but the duty to operati onalize the state's obligat ions under Econo mic and Social Human Rights. Is hunger a violati on of Human Rights ? Lack of access to food can have many reason. If the state fails to respect , protect or fulfill this access, unless for lack of resourc es in a society , this must be termed a violati on of the human right to food. Very often, the obligat ions of states vis-a- vis the vulner able groups and person s are obviou s and so is the availab ility of resourc es in society . Is the Right to Food about good govern ance? Good govern ance is negotia ble. Human Rights are not. The central concep t for human rights is the concep t of "violat ion", referri ng to the suppre ssion of vulner able groups and individ uals, wherea s the concep ts of good govern ance all too often deal with politic al theory and statisti cal indicat ors. If a countr y has the resourc es, but people get margin alized or contin ue in depriv ation, this is not bad govern ment, but oppres sion, intenti onal or not. Is the Right to Food realize d if nobod y is hungry anymo re? No necess arily. the Right to Food not only means that hunger and malnut rition are eradica ted, but that future malnut rition can be eradica ted by court action or other compa rable mecha nisms holdin g the state accoun table on its obligat ions under the Right to Food." 56. In Kishen Pattna yak and anothe r v. State of Orissa, 1989 Supp( 1) SCC 258, a Divisio n Bench of this Court while consid ering povert y and starvati on deaths in drough t prone district s of Kalaha ndi and Korap ut in the State of Orissa having regard to the report of the Distric t Judge of Kalaha ndi noticed that Natura l Calami ties Comm ittee had been constit uted at the district s level of Kalaha ndi and Korap ut directe d the Gover nment of Orissa to recom mend at least five person s belong ing to the recogn ized volunt ary organi zations like Saryod aya Gandhi Peace Found ation, Ramak rishna Missio n, Bhart Sewa Sangha and registe red volunt ary agenci es as membe rs of the said Natura l Calami ties Comm ittee. The Court monito red for a long time the measur es taken by the State for the purpos e of mitigat ing hunger , povert y, starvati on deaths etc., of the people of Kalaha ndi and Korap ut. It opined that if such measur es are taken, there can be no doubt that it will alleviat e to a great extent the miserie s of the people of Kalaha ndi. It was directe d: "........ The Natura l Calami ties Comm ittee shall also keep a watch over the workin g of the social welfar e measur es which are being taken and may be taken in future. Shri Pattna yak also does not dispute tha it such measur es are contin ued to be taken it will be a great relief to the people of Kalaha ndi and Korap ut. We hope and trust that in view of the prompt action that has been taken by the govern ment, soon the miserie s of the people of these two district s will be over." 57. Yet again in M/s Shanti star Builde rs v. Naray an Khima lal Totam e and others, 1990(1 ) SCC 520, this court observ ed :- "Basic needs of man have traditio nally been accept ed to be three - good, clothin g and shelter. The right to life is guaran teed in any civilize d society . That would take within its sweep the right to food, the right to clothin g, the right to decent enviro nment and a reason able accom modati on to live in....." 58. This Court upheld the right to shelter in P.G. Gupta v. State of Gujara t and others, 1995 Supp( 2) SCC 182, Chame li Singh (supra ) and Ahmed abad Munic ipal Corpor ation v. Nawab Khan Gulab Khan and others, 1997(1 1) SCC 121. In Chame li Singh's case (supra) , this Court held : "In any organi zed society , right to live as a human being is not ensure d by meetin g only the animal needs of man. It is secure d only when he is assure d of all faciliti es to develo p himsel f and is freed from restrict ions which inhibit his growth . All human rights are design ed to achiev e this object. Right to live guaran teed in any civilize d society implies the right to food, water, decent enviro nment, educati on, medica l care and shelter. These are basic human rights known to any civilize d society ....." It procee ded to held : "Right to shelter when used as an essenti al requisi te to the right to live should be deeme d to have been guaran teed as a funda mental right. As is enjoine d in the Directi ve Princip les, the State should be deeme d to be under an obligat ion to secure it for its citizen s, of course subject to its econo mic budget ing. In a democ ratic society as a membe r of the organi zed civic comm unity one should have perma nent shelter so as to physic ally, mental ly and intellec tually equip oneself to improv e and intellec tually equip oneself to improv e his excelle nce as a useful citizen as enjoine d in the Funda mental Duties and to be a useful citizen and equal partici pant in democ racy. The ultimat e object of makin ga man equipp ed with a right to dignity of person and equalit y of status is to enable him to develo p himsel f into a culture d being.. ......." 59. The term `life' used in Article 21 of the Constit ution of India has a wide and far reachin g concep t. It include s livelih ood and so many other facets thereof . "Life", as observ ed by Field, J. in Munn v. Illinois , 1877(9 4) US 113 means someth ing more than mere animal existen ce and the inhibiti on against the depriv ation of life extend s to all those limits and faculti es by whcih life is enjoye d. [See Board of Truste es of the Port of Bomba y v. Dilipk umar Ragha vendra nath Nadka rni and others, 1983(1 ) SCC 124 and Olga Tellis and others v. Bomba y Munic ipal Corpor ation and others, 1985(3 ) SCC 545. 60. In Nadkar ni's case (supra) , this Court was dealing with the right of a workm an. 61. Expans ion of the right to life and person al liberty under Article 21 of the Constit ution has been made by implic ating : (i) Right to travel - Manek a Gandh i v. Union of India, AIR 1978 SC 597; Satwa nt Singh v. A.P.O. New Delhi, AIR 1967 SC 1836. (ii) Right to privac y- Khara k Singh v. State of U.P., AIR 1963 SC 1295; Shard a v. Dhara mpal, JT 2003(3 ) SC 399. (iii) Right to speedy trial - Comm on Cause, a Regist ered Society v. Union of India, AIR 1997 SC 1539. (iv) Right to prisone r to intervi ew - Prabh a Dutt v. Union of India, AIR 1982 SC 6. (v) Right to fair trial - Police Comm issione r, Delhi v. Registr ar, Delhi High Court, AIR 1997 SC 95. (vi) Right against torture and custodi al violenc e- D.K. Basu v. State of West Bengal , AIR 1997 SC 10. (vii) Right to free legal aid - State of Mahar ashtra v. M.P. Vashi, AIR 1996 SC 1. (viii) Right to primar y educati on - Unnik rishna n v. State of A.P., 1993(1 ) SCC 645; T.M.A. Pai Found ation v. State of Karnat aka, 2002(8 ) SCC 481. (ix) Right to health and medica l care - CERC v. Union of India, AIR 1995 SC 922; State of Punja b v. M.S. Chawl a, AIR 1997 SC 125. (x) Right to polluti on-free enviro nment - M.C. Mehta v. Union of India, AIR 1987 SC 965. (xi) Right to Safe drinkin g water - APPC B v. M.V. Naidu, AIR 1999 SC 822. (xii) Sexual harass ment of workin g women - Visakh a v. State of Rajast han, AIR 1997 SC 3011; AEPC v. A.K. Chopr a, 1999(2 ) SCC 34. (xiii) Right to a quality life - Hinch Lal Tiwari v. Kamal a Devi and others, 2001(6 ) SCC 496. (xiv) Right to Family Pensio n- S.K. Masta n Bee v. Gener al Manag er South Centra l Railwa y, 2003(1 ) SCC 184. 62. While dealing with the right of the workm en, again this Court in People 's Union for Democ ratic Rights and others v. Union of India and others, 1982(3 ) SCC 235 and in State of Gujara t v. Hon'bl e High Court of Gujara t, 1998(7 ) SCC 392 held that constit utional provisi ons must be so interpr eted so as to advanc e its socio econo mic objecti ves. In no uncerta in terms, this Court held that exactio n of labour and service s against payme nt of less than the minim um wages amoun ts to forced labour within the meanin g of Article 23 of the Constit ution of India. 63. Explai ning the rights of a citizen under Article 21 of the Constit ution of India, this Court in S.M.D. Kiran Pasha v. Gover nment of Andhr a Prades h and others, 1990(1 ) SCC 328obs erved that Article 226 of the Constit ution of India would be mainta inable also when a right is threate ned as contra disting uished from the right when infring ed. This Court held : "In the langua ge of Kelsen the right of an individ ual is either a mere reflex right - reflex of a legal obligat ion existin g toward s this individ ual; or a private right in the technic al sense - the legal power bestow ed upon an individ ual to bring about by legal action the enforc ement of the fulfill ment of an obligat ion existin g toward s him, that is, the legal power. From the above analysi s it is clear that in the instant case the appella nt's funda mental right to liberty is the reflex of a legal obligat ion of the rest of the society , includi ng the State, and it is the appella nt's legal power bestow ed upon him to bring about a legal action the enforc ement of the fulfill ment of that obligat ion existin g toward s, amoun t to denial of his right of enforc ement of his right to liberty. ........." 64. It is also well- settled that interpr etation of the Constit ution of India or statues would change from time to time. Being a living organ, it is ongoin g and with the passag e of time, law must change . New rights may have to be found out within the constit utional schem e. Horizo ns of constit utional law are expand ing. The necessi ty to take recours e to such interpr etative change s has recentl y found favour with a Divisio n Bench of this Court in the State of Mahar ashtra v. Dr. Praful B. Desai, JT 2003(3 ) SC 382. "13. One needs to set out the approa ch which a court must adopt in decidin g such questio ns. It must be remem bered that the first duty of the court is to do justice. As has been held by this Court in the case of Sri Krishn a Gobe v. State of Mahar ashtra, 1973(4 ) SCC 23cour ts must endeav our to find the truth. It has been held that there would be failure of justice not only by an unjust convict ion but also by acquitt al of the guilty for unjusti fied failure to produc e availab le eviden ce. Of course the rights of the accuse d have to be kept in mind and safegu arded, but they should not be over empha sized to the extent of forgetti ng that the victims also have rights. 14. It must also be remem bered that the Crimin al Proced ure Code is an ongoin g statute. The princip les of interpr eting an ongoin g statute have been very succin ctly set out by the leading jurist Francis Bennio n in his comme ntaries titled "Statut ory Interpr etation ", 2nd Editio n page 617 : "It is presum ed the Parlia ment intends the court to apply to an ongoin g Act a constru ction that contin uously update s its wordin gs to allow for change s since the Act was initiall y framed . While it remain s law, it hasto be treated as always speaki ng. This means that in its applica tion on any day, the langua ge of the Act though necess arily embed ded in its own time, is nevert heless to be constru ed in accord ance with the need to treat it as a current law. ........... ...... In constru ing an ongoin g Act, the interpr eter is to presum e that Parlia ment intende d the Act to be applied at any future time in such a way as to give effect to the origina l intenti on. Accord ingly, the interpr eter is to make allowa nces for any relevan t change s that have occurr ed since the Act's passin g in law, in social conditi ons, technol ogy, the meanin g of words and other matters ......... That today's constru ction involv es the suppos ition that Parlia ment was caterin g long ago for a state of affairs that did not then exist is no argum ent against that constru ction. Parlia ment, in the wordin g of an enactm ent, is expect ed to anticip ate tempor al develo pments . The drafter will foresee the future and allow for it in the wordin g. ......... An enactm ent of former days is thus to be read today, in the light of dynam ic proces sing receive d over the years, with such modifi cation of the current meanin g of its langua ge as will now give effect to the origina l legislat ive intenti on. The reality and effect of dynam ic proces sing provid es the gradua l adjust ment. It is constit uted by judicia l interpr etation , year in and year out. It also compri ses proces sing by executi ve official s." 15. At this stage the words of Justice Bhagw ati in the case of Nation al Textile Worke rs' Union v. P.R. Ramak rishna n, 1983(1 ) SCR 922 at page 956, need to be set out. They are : "We cannot allow the dead hand of the past to stifle the growth of the living present . Law cannot stand still : it must change with the changi ng social concep ts and values. If the bark that protect s the tree fails to grow and expand along with the tree, it will either choke the tree or if it a living tree, it will shed that bark and grow a new living bark for itself. Simila rly, if the law fails to respon d to the needs of changi ng society , then either it will stifle the growth of the society and choke its progre ss or if the society is vigoro us enough , it will cast away the law which stands in the ways of its growth . Law must therefo re consta ntly be on the move adaptin g itself to the fast changi ng society and not lag behind ." 65. The liabilit y of the shareh olders or even a third party in a given case would depend upon the nature of the situatio n and the extent of the statute coveri ng the same. Partici pation in the functio ning of a compa ny has led to an indepe ndent liabilit y by the secure d credito rs under the Compr ehensi ve Enviro nment Respo nse Compe nsation and Liabilit y Act, if its involv ement with the manag ement of the facility is suffici ently broad to suppor t the inferen ce that it could affect hazard ous waste dispos al decisio ns; althou gh it was not current ly an owner or operati on of the facility within the meanin g thereof in United States v. Fleet Factor s Corpor ation, 20 ELR 20832 : (1990) 901 F 2d 1550. Thus a liabilit y can be fastene d both upon the owner as also the operat or of th compa ny under certain situatio ns. 66. The right to develo pment in the develo ping countri es is itself a human right. The same has been made a part of WTO and GATT. In `The World Trade Organi sation, Law, Practic e, and Policy (Oxfor d) by Mathu sushita Schoen baum and Mauroi dis at page 389, it is stated : "The United Nation s has proclai med the existen ce of a human right to develo pment. This right refers not only to econo mic growth but also to human welfar e, includi ng health, educati on, emplo yment, social securit y, and a wide- range of other human needs. This human right to develo pment is vaguel y define d as a so- called third- generat ion human right that cannot be imple mented in the same way as civil and politic al human rights. Rather, it is the obligat ion of states and intergo vernm ental organi zations to work within the scope of their authori ty to combat povert y and misery in disadv antage d countri es. [Emph asis supplie d] 67. The matter may be consid ered from anothe r angle. While the State expect s the industr ial houses and multi- nationa l compa nies to take such measur es which would provid ea decent life to the person s living in the society in general and to their emplo yees in particu lar and in that premis e it is too much to ask the State to practic e what it preach es ? This gives rise to anothe r questio n. Can the State be so insensi tive to the plight of its own citizen s in general and the emplo yee of the public sector undert akings in particu lar ? 68. The court in a situatio n of his nature is obligat ed to issue necess ary directi ons to mitigat e the extrem e hardshi p of the emplo yees involvi ng violati on of human rights of the citizen s of India at the hands of the State of Bihar and the govern ment compa nies and corpor ations fully owned or control led by it. A right to carry on busine ss is subject to compli ance of constit utional obligat ions as also limitati ons provid ed for in the Constit ution. 69. Financ ial stringe ncy may not be a ground for not issuing requisi te directi ons when a questio n of violati on of funda mental right arises. This Court has been highlig hting this aspect in the matters concer ning funda mental rights and mainte nance of ecolog y. [See Rural Litigat ion and Entitle ment Kendr a and others v. State of Uttar Prades h and others, AIR 1987 SC 359 = 1986 Supp. SCC 517, Munic ipal Counc il, Ratla m, 1980(4 ) SCC 162 and B.L. Wadhe ra v. Union of India, AIR 1996 SC 2969. In All India Imam Organi zation and others v. Union of India and others, 1993(3 ) SCC 584, this Court held; "6....... Much was argued on behalf of the Union and the Wakf Boards that their financi al positio n was not such that they can meet the obligat ions of paying the Imams as they are being paid in the State of Punjab . It was also urged that the numbe r of mosqu es is so large that it would entail heavy expend iture which the Boards of differe nt States would not be able to bear. We do not find any correla tion betwee n the two. Financ ial difficul ties of the institut ion cannot be above funda mental right of a citizen. IF the Boards have been entrust ed with the respon sibility of supervi sing and admini stering the Wakf then it is their duty to harnes s resourc es to pay those person s who perfor m the most import ant duty namely of leading comm unity prayer in a mosqu e the very purpos e for which it is created ." [Emph asis supplie d] 70. In State of H.P. v. H.P. State Recog nised and Aided School s Manag ing Comm ittees and others, 1995(4 ) SCC 507, it was opined : "16. The constit utional mandat e to the State, as upheld by this Court in Unni Krishn an case - to provid e fee educati on to th childre n up to the age of fourtee n- cannot be permitt ed to be circum vented on the ground of lack of econo mic capacit y or financi al incapa city." 71. Howev er, before we issue any directi on, we may state that by no stretch of imagin ation, the liabilit y of the State of Bihar can be shifted to the Union of India. Only becaus e the Union of India alleged ly is reposit ory of funds raised by it throug h Central excise and other levies and impost , the same by itself would not mean that it is indirec tly or vicario usly liable for the failing s on the part of the State Public Sector Undert akings. Either preced entiall y or jurispr udentia lly the Union of India cannot be held liable and no such directi on can be issued as has been submit ted by Mr. Shanti Bhush an. 72. The invest ments made by the State in the public sector undert akings in pursuit of social justice is from public accoun t. It is in this behalf accoun table to the public throug h the legislat ure. If the State or the State agenci es have failed to perfor m their duties, it cannot under the wrap of financi al stringe ncy seek to shift its liabilit y to the Union of India or to the State of Jharkh and. 73. The matter might have been differe nt, had such financi al assista nce was require d by the State due to a natural calamit y or cause beyond its control . 74. The State must thank itself for having placed itself in such a state of affairs. It at an approp riate stage, having regard to its right of deep and pervasi ve control over the Public Sector Undert akings it had properl y supervi sed the functio ning of the Gover nment Compa nies and take necess ary steps to refer the sick compa nies to BIFR in terms of the provisi ons of the Sick Industr ial Compa nies (Speci al Provisi ons) Act, 1985, the positio n might have been differe nt. It even failed to take any positiv e action even after comin g to know the starvati on deaths and immen se human sufferi ngs. 75. The States of India are welfar e States. They having regard to the constit utional provisi ons adumb rated in the Constit ution of India and in particu lar Part IV thereof laying down the Directi ve Princip les of the State Policy and Part IVA laying down the Funda mental Duties are bound to preserv e the practic e to mainta in the human dignity . 76. We are of the opinio n that the State, thus, has made itself liable to mitigat e the sufferi ngs of the emplo yees of the public sector undert akings or the govern ment compa nies. 77. While passin g an interim order, howev er, it is our duty to take into consid eration the immed iate hardshi p which may be faced by the State of Bihar having regard to the alleged financi al stringe ncy. 78. We, howev er, hasten to add that we do not intend to lay down a law, as at present advise d, that the State is directl y or vicario usly liable to pay salarie s/remu neratio ns of the emplo yees of the public sector undert akings or the Gover nment compa nies in all situatio ns. We, as explain ed herein before, only say that the State cannot escape its liabilit y when a human rights proble m of such magnit ude involvi ng the starvati on deaths and/or suicide by the emplo yees has taken place by reason of non- payme nt of salary to the emplo yees of Public Sector Undert aking for such a long time. We are not issuing any directi on as against the State of Jharkh and as no step had admitt edly been taken by the Central Gover nment in terms of Sectio n 65 of the State Reorga nisatio n Act and further more as only four public sector undert akings have been transfe rred to the State of Jharkh and in respect whereo f the petitio ner does not make any grieva nce. 79. In the peculia r facts and circum stance of this case in our opinio n, interest of justice shall be met, if the followi ng interim directi ons are issued for the present : 1. The High Court may strive to dispos e of all liquida tion procee dings in respect of the Gover nment compa nies owned and control led by the State of Bihar as expedit iously as possibl e. For the said purpos e and/or purpos es ancilla ry to or inciden tal therew ith, it may pass an interim order and/or orders by way of sale and/or dispos al of the propert ies belong ing to such public sector undert aking and/or Gover nment compa nies or to take such measur e or measur es as it may deem fit and proper. 2. For the aforem entione d purpos es a commi ttee not consist ing of more than three membe rs chaired by a retired High Court Judge or a sitting Distric t Judge may be appoin ted who may scrutin ize the assets and liabiliti es of the compa nies and submit a report to the High Court as expedit iously as possibl e prefera bly within three months from the date of constit ution of the commi ttee. The terms and conditi ons for appoin tment of the said Comm ittee may be determ ined by the high Court. All expens es in this behalf shall be borne by the Stat of Bihar. 3. The High Court shall be entitle d to issue requisi te directi on/dire ctions to the said commi ttee from time to time as and when it deems fit and proper. 4. The State for the present shall deposit a sum of Rs. 50 crores before the High Court for disburs ement of salarie s to the emplo yees of the corpor ations. The amoun t of Rs. 50 crores be deposit ed in two instalm ents. Half of the amoun t shall be payabl e within one month and the balanc e amoun t within a month thereaf ter. The High Court shall see to it that the sum so deposit ed and/or otherw ise receive d from any source includi ng by way of sale of assets of the Gover nment Compa nies/Pu blic Sector Undert akings be paid propor tionate ly to the concer ned emplo yee wheref or, the parties may file their claims before it. 5. The High Court, howev er, in its discreti on may direct disburs ement of some funds to the needy emplo yees, on ad hoc basis so as to enable them to sustain themse lves for the time being. 6. The rights of the workm en shall be consid ered in terms of Sectio n 529- A of the Compa nies Act. 7. The Central Gover nment is hereby directe d to take a decisio n as regards divisio n of assets and liabiliti es of the Gover nment Compa nies/Pu blic Sector Undert akings in terms of the provisi ons of the State Reorga nisatio n Act, 2000. 8. The State of Jharkh and is hereby implea ded as a respon dent. Let notice be issued to the newly added respon dent. 80. This order shall be subject to any order that may be passed subseq uently or finally. 81. Let the matter be placed again after six months . --------- ---###- --------- --