Abstract
The concept of “State” was initially considered to be an exhaustive and limited to the authorities listed in Article 12 of the Constitution of India as well as those that could be read “ejusdem generis” with those authorities. Private entities as a state have always been a matter of debates and discussion as reflected in several judicial interpretation.
Introduction
The Constitution’s drafters used the term “State” in a broader sense than what is typically or narrowly interpreted. It refers to more than only the Union’s member nations. The phrase “includes” in the article indicates that the definition is not exhaustive, and the court has broadened the scope of the Article through its rulings much beyond what even the original drafters of Article 12 may have had in mind when the constitution was being drafted. The broadened concept of State is an ongoing area of research and the students of Coochbehar law college have developed a dynamic approach in studying the instrumentalities of State under Article 12.
Concept of State under Article 12 of the Constitution of India
The concept of “state” enshrined under Part-III of the Constitution can be interpreted only within the scope and purview of Part -III of the Constitution. The provision of Article 12 can be applied only in the light of Fundamental Rights. Article 12 of the Constitution of India provides an inclusive and non-exhaustive concept of the State. It states that “state” includes –
(a) The Government and Parliament of India.
(b) The Government and the Legislatures of each of the State
(c) All local or other authorities within the territory of India
(d) All local or other authorities are under the control of the Government of India.
Private Entities as State under Article 12
One of the critical levels of debates and discussion lies in whether private entities and their activities come under the concept of State under Article 12 of the Constitution. In the United States, Private entities as a state can be analysed from different perspectives- leasing property, granting aid, and granting some privileges by the government. In the case of Culver et al. v. City of Warren et al. [83 N. E. 2d. 82 (1948)], the US Supreme Court held that if the Municipal Swimming pool were leased to a private corporation, the corporation would become just a mere instrumentality through which the city operated the swimming pool. In this case, the question of whether or not the pool was run for public use was immaterial.
The conversion of private entities into the concept of State by the grant of State was presented in the case of Betts v. Easley [160 P. 2d. 831 (1946)]. In this case, through its provision, the Railway Labour Act directed a sole collective bargaining agent on behalf of Railway employees. The Supreme Court of Kansas observed, “in performing its functions as such statutory bargaining agent, a Labour organization is not to be regarded as a wholly private association of individuals free from all Constitutional or statutory restraints to which public agencies are subjected.” Therefore, a private entity with state aid comes within the purview of the State, and its actions can be considered state action.
In the Indian context, the Supreme Court in Ajay Hasia & Ors v. Khalid Mujib Sehravardi & Ors [(1981) AIR 487 SC] laid down specific tests that would be applied to determine whether or not a corporation is an instrumentality of State. The tests are based on the following:
- Whether or not the government holds the entire share capital.
- Whether or not the funding of the State is the chief financial source of the body.
- Whether or not there is an existence of deep and persuasive control.
- Whether or not the functional character is governmental.
- Whether or not the State enjoys a monopoly over the body.
Ajay Hasia’s case provides us with the picture that private companies are not a state functionality. In this case, it was further observed that merely regulatory control by a statute or otherwise over a private entitle does not make it a state.
In the light of the case of Zee Telefilms v. UOI [(2005) AIR 2677 SC], it can be stated that if states restrictions and regulations are provided in the management of a private company corporation through a statute but the decision-making policies are left outside the scope of such restrictions, it would be difficult to assume that the state control is deep and pervasive. The depth and extent of the state control would make a private entity an instrument of State as per Ajay Hasia’s case.
Conclusion
It can be concluded that the Constitution of India does not incorporate the constitutional restraints to private entities. It is only the State and its agents that are under constitutional restraints. Private entities as State depends on the test which can be considered to determine a state agent. The tests are not static in nature. It embraces the dynamic approach. Therefore, it is important for every student of coochbehar law college to understand the various facets of such dynamic judicial interpretation.
