AJAY HASIA ETC. v. KHALID MUJIB SEHRAVARDI & ORS. ETC (2)

Citation: [1981] 2 S.C.R. 79

Court: Supreme Court of India

Bench: Y.V. CHANDRACHUD, P.N. BHAGWATI, V.R. KRISHNA IYER, S. MURTAZA FAZAL ALI, A.D. KOSHAL

Case summary

These writ petitions under Article 32 of the Constitution challenge the validity of the admissions made to the ~egional Engiheering College, Srinagar for the academic year 1979-80....

Judgment text

AJAY RASIA ETC. v. KHALID MUJIB SEHRAVARDI & ORS. ETC. November 13, 1980 [Y. V. CHANDRACHUD, C. J. , P. N. BHAGWATI, V. R. KRISHNA IYER, 8 s. MURTAZA FAZAL ALI AND A. D. KosHAL, JJ. ] Adn1ission to Engineering College-Jammu & Kashmir Regional Engineering College, Srinagar, registered as a society under the Jam1nu & Kashmir Registration of Societies Act, 1898-Whether a "State" under Article 12 of the Constitution and amenable to writ jurisdiction.

Viva voce test-Interview of each of thr candidates fa,Ning only two or three minutes asking formal questions relating to the candidates parentage and residence and without any relevance to the subject for which marks were allocated, whether arbitrary-Allocation of 113 of the total marks required for the qr1alifying examination for the viva voce-Whcther bad, unreasonable and arbitrary-Whether prescribing different admission procedures for candidates belonging to tlie State of Jammu & Kashmir and candidates belonging to other States is violative of the Equality Clause under Article 14. Dismissing the writ petitions, the Court HELD: (! ). Having regard to the Me. norandum of Association and the Rules of the Society, the respondent college is a State within the meaning of Article 12.

The composition of the Society is dominated by the representatives appointed by the Central Government and the Governments of Jammu & Kashmir, Punjab, Rajasthan and Uttar Pradesh with the approval of the Central Government. The monies required for running the College are provided entirely by the Central Government and the Government of Jamrnu & Kashmir and even if any other monies are to be received by the Society, it can be done only v. ith the approval of the State and the Central Governments. The Rules to be made by the Society are also required to have the prior approval of the State and the Central Governments and the accounts of the Society have also to be submitted to both the Governments for their scrutiny and satisfaction. The Society is also to comply \vith all such directions as may be issued by the State Government with the approval of the Central Government in respect of any matters dealt with in the report of the Reviewing Committee.

The control of the State and the Central Governments is indeed so deep and pervasive that no immovable property of the Society can be disposed of in any manner without the approval of both the Governments. The State and the Central Governments. have even the power to appoint any other person or persons to be members of the Society and any member of the Society otlier than a member representing the State or the Central Government can be removed from the membership of the Society by the State Government with the approve! of ! he Central Government. The Board of Governors, which is incharge of general superintendence, direction and control of the affairs of the Society and of its income and property is ailso largely controlled by nominies of the State and the Central Governments. The State Government and by reason of the provision for epproval, the Central Government also thus have full control of the work- -. ,,,. -- _, - ·- -· >1&-:a~A••---a.. C.. IF.. l __......

M~ so ing of the Society and therefore, the Society is merely a projection of the State and the Central Governments. The voice is that of the State and the Centro1 Governments. The Society is an instrun1ent'ality or the agency of the State and the Central Governments and it is an "authority" within the meaning of Article 12. If the Society is, an "authority" and, therefore, the "State" within the meaning of Article 12, it must follow that it is subject to the constitutional obligation under Article 14. [99F-H, 100 K-FJ (2) The expressi0n "other authorities'\ in Article 12 must be given an interpretation where constitutional fundamentals vital to the maintenance of human rights are at stake, functional realism and not facial cosmetics must be the diagnostic tool, for constitutional law must seek the substance and not the form.

The Government may act through the instrumentality or agency of juridical persons to carry out its functions, since, with the advent of the welfare State its new task have increased manifold. [90B-D] It is, undoubtedly, true that the corp0ration is a distinct juristic entity with a corporate structure of its own and it carries on its functions on business principles with a certain amount of autonomy which is necessary as well as useful from the point of view of effective business management, but behind the formal ownership which is cast in the corporate mould, the reality is very much the deeply pervasive presence of the Government. It is really the Government \\'hich acts through the instrumentality or agency of t'he corporation and the 0 juristic veil of corporate personality worn for the purpose of convenience of management and administration cannot be allowed to obliterate the true nature cf the reality behind which is the Government.

It is clear that if a corporation is an instrumentality or agency of the Government, it must be subject to the same limitations in the field of constitutional law os the Government itself, though in the eye of the la. w it would be a distinct and independent legal entity. H the Government acting through its officers is subject to certain constitutional limit'ations, it must follow a fortiorari that the Government acting through the instrumentality or agency of a corporation should equally be subject to the same limitations. If such a corporation were to be free from the basic obligation to obey the Fundamental Rights, it would lead to considerable erosion of the efficiency of the Fundamental Rights, for in that event the Government would be enabled to override the Fundamental Rights by adopting the stratagem of carrying out its functions through the instrumentality or agency of a corporation, while retaining control over it.

The Fundamental Rights would then be reduced to little more than an idle dream or a promise of unreality. [91B-FJ The Courts should be anxious to enlarge the scope and width of the Fundamental Rights by bringing within their sweep every authority which i• an instrumentality or agency of the Government or through the corporate personality of which the Government is acting, so as to subject the Government in all its myriad activities, whether t'hrough natural persons or through corporate entities, to the basic oblig6tion of the Fundamental Rights. The constitutional philosophy of a democratic socialist republic requires the Government to undertake a multitude of socio.. economic operations and the Government, having regard to the practical advantages of functioning through the legal device of e.

corporation, embarks on myriad commercial and economic activities by resorting to the instrumentality or agency of a corporation, but this contrivance of ca1Tying on such activities through a corporation cannot exonerate the Gov corporation and the juristic veil of corporate personality worn for the purpose of convenience of management and administration cannot be allowed to obliterate the true nature of the reality behind which is the Government. Now it is obvious that if a corporation is an instru mentality or agency of the Government, it must be subject to the same limitations in the field of constitutional law as the Government itself, though. in the eye of the law it would be a distinct and independent legal entity. If the Government acting through its officers is subject to certain constitutional limitations, it must follow a fortiorari that the Government acting through the instrumentality or agency of a corpo ration shoukl equally be subject to the same limitations.

If such corporation were to be free from the basic obligation to obey the Fundamental Rights, it would lead to considerable erosion of the efficiency of the Fundamental Rights, for in that event the Govern ment would be enabled to over-ride the Fundamental Rights by adopting the stratagem of carrying ont its functions through the instru mentality or agency of a corporation, while retaining control over it. The Fundamental Rights would then be reduced to little more than an idle dream or a promise of unreality. It must be remembered that the Fundamental Rights are constitutional guarantees given to the people of India and are not merely paper hopes or fleeting promises and so long as they find a place in the Constitution, they should not be allow ed to be emasculated in their application by a narrow and constricted judicial interpretation.

The courts should be anxious to enlarge the scope and width of the Fundamental Rights by bringing within their sweep every authority which is an instrumentality or agency of the Government or through the corporate personality of which the Gov ernment is acting, so as to subject the Government in all its myriad activities, whether through natural persons or through corporate entities, to the basic obligation of the Fundamental Rights. The constitutional philosophy of a democratic socialist republic requires 1-12&1SCl}&O the Government fo undertake a multitude of socio-economic operations and lhe Government, having regard to the practical advantages of functioning through the legal device of a corporation, embarks on myriad commercial and economic activities by resorting to the instrumentality or agency of a corporation, but this contrivance of carrying on such activities through a corporation cannot exonerate the Government from implicit obedience to the Fundamenlal Rights. To use.

the corporate methodology is not to liberate the Government from its basic obligation to respect lhe Fundamental Rights and not to oveHide them. The mantle of a corporation may be adopted in order to free the Government from the inevitable constraints of red-lapism and slow molion but by doing so, the Government cannot be allowed to play truant with the basic hnman rights. Otherwise it would be the easiest thing for the government to assign to a plurality of corporalions almost every State business such as Post and Telegraph, TV and Radio, Rail Road and Telephones-in short every . economic activityand \hereby cheat the people of India out of the Fundamental Rights guaranteed to them.

That would be a mockery of the Constitution and nething short of treachery and breach of faith with the people of India, because, though apparently the corporation will be carrying out these functions, it will in truth and reality be the Government which will be controlling the corporation and carrying out these functions through \he instrumenlality or agency of the corporation. We cannot by a process. of judicial construction allow the Fundamental Rights to be rendered futile and meaningless and thereby wipe out Chapter III from the Constitution. That would be contrary to· the constitutional faith of the post-Menaka Gandhi era. It is the Fundamental Rights which along with the Directive Principles constitule th~ life force of the Constitution and they must be quickened into effective action by meaningful and purposive interpretation.

If a corporation is found to be a mere agency or surrogate of the Government, "in fact owned by the Government, in truth controlled by the government and in effect an incarnation of the government," the court must not allow the >enforcement of Fundamental Rights to be frustrated by taking the view that it is not the government and therefore not subject to the constitutional limitations. We are clearly of the view that where a corporation is an instrrnnentality or agency of the government, it must be held to be an 'authority' within the meaning of Art. 12 and hence 5ubject to the same basic obligation to obey the Fundamental Rights as lhe government. We may point out that this very question as to when a corporation can be regarded as an 'authority' within the meaning of Art. 12 arose for consideration before this Court in R. D. Shelly v. The International AJAY HASIA v. KHALID MUJJB (Bhagwati, J. ) Airport Authority of India & Ores.

( ) There, in a unanimous judgment of three Judges delivered by one of us (Bhagwati, J) this Court pointed out : "So far as India is concerned, the genesis. of the emergen. ce of corporations as inslrumentalities or agencies of Government is to be found in the Government of India Resolution on Industrial Policy dated 6th April, 1948 where it was stated inter alia that "management of State enterprises will as a rule be through the medium of public corporation under the statutory control of the Central Government who will assume such powers as may be necessary to ensure this. " It was in pursuance of the policy envisaged in this and subsequent resolutions on Industrial policy that corporations were created by Government for setting up and management of public enterprises and carrying out other public functions.

Ordinarily these functions could have been carried out by Government departmentally through its service personnel but the instrumentality or agency of the corporation was resorted to in these cases having regard to the nature of the task to be performed. The corporations acting as instrumentality or agency of Government would obviously be subject to the same limitations in the field of constitutional and administrative law as Government itself, though in the eye of the law, they woukl be distinct and independent legal entities. If Government acting through its officers is subject to certain constitutional and public law limitations, it must follow a fortiori that Government acting through instrumentality or agency of corporations should equally be subject to the same limitations.

" The Court then addressed itself to the question as to how to determine whether a corporation is acting a9 an instrumentality or agency of the Government and dealing with that question, observed : • "A corporation may be created in one of two ways. It may be either established by statute or incorporated under a law such as the Companies Act 1956 or the. Societies Registration Act 1860. Where a Corporation is wholly controlled by Government not only in its policy making but also in carrying out the functions entrusted to it by the law ' establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government. But o! Pinarily where a corporation (I) [1979] I S. C. R. 1042. ______,,,.. 94 SUPRHIE COURT REPORTS (1981] 2 S. C. R.

is established by statute, it is autonomous in its working, subject only to a provision, often times made, that it shall be bound by any directions that may be issued from time to time by Government in respect of policy matters. So also a corporation incorporated under lilw is managed by a board of directors or committee of management in accordance with the provisions of the statute under which it is in• corporated. When does such a corporation become an instrumentality or agency of Government? Is the holding of the entire share capital of the Corporation by Government enough or is it necessary that in addition there should be a certain amount of direct control exercised by Government and, if so what should be tl1e nature of such control ? Should the functions which the Corporation is charged to carry out possess any particnlar characteristic or feature, or is the nature of the functions immaterial?

Now, one thing is clear that if the entire share capital of the corporation is held by Government, it would go a Jong way towards indicating that the corporation is an instrumentality or agency of Government. But, as is quite often the case, a corporation established by statute may have no shares or shareholders, in which case it would be a relevant factor to consider whether the administration is in the hands of a board of directors appointed by Government though this consideration also may not be determinative, because even where the directors are appointed by Government, they may be completely free from governmental control in the discharge of their functions. What then are tests to determine whether a corporation established by statute or incorporated under law is an instrumentality or agency of Government ? It is not possible to formulate an inclusive or exhaustive test which would adequately answer >this question.

There is no cut and dried formula, which would provide the correct division of corporations into those which are instrumentalities or agencies of Government and those which are not. " The Court then proceeded to indicate the different tests, apart from ownership of the entire share capital : " ........ if extensive and unusual financial assistance is given and the purpose of the Goverument in giving snch assistance coincides with the purpose for which the corporation is expected to use the assistance and such purpose is of AJAY !! ASIA v. KHALID MUJIB (Bliagwati, J. ) 95 public character, it may be a relevant circumstance supporting an inference that the corporation is an instrumentality or agency of Government. . . . . . . . . . It may therefore be possible to say that where the financial assistance of the State is so much as to meet almost entire expendiutre of the corporation, it would afford some indication of the corporation being impregnated with governmental character . . . . .

. . . . . But a finding of State financial support plus an unusual degree of control over the management and policies might lead one to characterise an operation as State action-Vide Sukhdev v. Bhagatram [1975] 3 SCR 619 at 658. So also the existence of deep and pervasive State control may afford an indication that the Corporation is a State agency or instrumentality. It may also be a relevant factor to consider whether the corporation enjoys monopoly status which is State conferred or State protected. There can be little doubt that State conferred or State protected monopoly status would be highly relevant in assessing the aggregate weight of the corporation's ties to the State. " "There is also another factor which may be regarded as having a bearing on this issue and it is whether the operation of the corporation is an important public function.

It has been held in the United States in a number of cases that the concept of private action must yield to a conception ofl State action where public functions are being performed. Vide Arthur S. Miller : "The Constitutional Law of the Security State" (10 Stanford Law Review 620 at 664) . " "It may be noted that besides the so-called tra<;litional functions, the modern state operates as multitude of public enterprises and discharges a host of other public functions. If the functions o~ the corporation are of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government. This is precisely what was pointed out by Mathew, J. , in Sukhdev v. Bhagatram (supra) where the learned Judge said that "institutions engaged in matters of high pnblic interest of performing public functions are by virtue of the nature of ! he functions performed government agencies.

Activities which are too fundamental to the society are by definition too important not to be considered government functions. " 1• &WM The court however proceeded to point out with reference to the last functional test : " .......... the decisions shc:iw that even this test of public or governmental character of the function i§ not easy of application and does not invariably lead to the correct inference because the range of governmental activity is broad and varied and merely because an activity may be such as may legitimately be carried on by Governmen. t, it does not mean that a corporation, which is otherwise a private entity, would be an instrumentality or agency of Govern ment by reason of carrying on such activity. In fact, it is difficult to distinguish between governmental functions and non-governmental functions.

Perhaps the distinction bet ween governmental and non-governmental functions is not valid any more in a social welfare State where the laissez faire is an outmoded concept and Herbert Spencer's social statics has no place. The contrast is rather between governmental activities which are private and private activities which are governmental. [Mathew, J. Sukhdev v. Bhagatram (supra) at p. 652]. But the public nature of the function, if impregnated with governmental character or "tied or entwined with Government" or fortified by some other additional factor, may render the corporation an instru mentality or agency of Government. Specifically, if a de partment of Government is transferred to a corporation, it would be a strong factor supportive of the inference. " These observations of the court in the International Airport Authority's case (supra) have our full approval.

The tests for determining as to when a corporation can be said to be a instrumentality or agency of Government may now be call ed out from the judgment in the International Airport Authority's case. These tests are not conclusive or clinching, but they are merely indi r cative indicia which have to be used with care nnd caution, because while stressing the necessity of a wide meaning to be placed on the expression "other authorities", it must be realised that it should not . G be stretched so far as to bring in every autonomous body which J1as some nexus with the Government within the sweep of the ex pression. A wide e_nlargement of the meaning must be tempered by \\;ise limitation. We may summarise the relevant tests gathered from the decision in the Intemational Airport Authority'� case as follows : capital of (1) "One, thing is clear that if the entire share the corporation is held by Government it would go a long AJAY BASIA v. KHALID MUJIB (Bhagwati, J.

) 97 way towards indicating that the corporation is an instru mentality o r agency of Government. " (2) "Where the financial assistance of the State is so much as to meet almost entire expenditure al' the corpora ). tion, it would afford some indication of the corporation being impregnated with governmental character. " (3) "It may also be a relevant factor ...... whether the corporation enjoys monopoly status which is the State con ferred or State protected. " (4) "Existence of deep and pervasive State control may afford an indication that the Corporation is a State agency or instrumentality. " (5) "If the functions of the corporation of public im portance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government.

" (6) "Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference of the corporation being an instrumentality or agency of Government. " If on a consideration of these relevant factors it is found that the corporation is an instrumentality or agency of government, it would, as pointed out in the International Airpirt Authority's case, be an 'authority' and, therefore, 'State' within the meaning of the expression in Article 12. We find that the same view has been taken by Chinnappa Reddy, J. in a subsequent decision of this court in the U. P. Warehousing Corporation v. Vijay Narain(') and the observations made by the learnei;l Judge in that case strongly reinforced the view we arn taking particularly in the matrix of our constitutional system. We may point out that it is immaterial for this purpose whether the corporation is created by a statute or under a statute.

The test is whether it is an instrumentality or agency of the Government and not as to how it is created. The inquiry has to be not as to how the juristic person is born hut why it has been brought into existence. The corporation may be a statutory corporation created by a statute or it may be a Government Company or a company formed under the Com papies Act, 1956 or it may be a society registered under the Societies Registration Act, 1860 or any other similar statute. Whatever be its genetical origin, it would be an "authority " within the meaning of Article R 12 ifit is an instrumentality or agency of the Government and that would c1i 11�so11sec459. have to be decided on a proper assessment of the facts in the light of the relevant factors.

The concept of instrumentality or agency of the Government is not limited to a corporation created by a statute but is equally applicable to a company or society and in a given case it would have to be decided, on a consideration of the relevant factors, whether the company or society is an instrumentality or agency of the Government so as to come within the meaning o'f the expression "authority" in Article 12. It is also necessary to add that merely because a juristic entity may be an "authority" and therefore "State" within the meaning of Article 12, it may not be elevated to the position of "State" for the purpose of Articles 309, 310 and 311 which find a place in Part XIV. The definition of "State" in Article 12 which includes an "authority" within the territory of India or under the control of the Government of ..

< India is limited in its application only to Part III and by virtue of Article 36, to Part IV : it does not extend to the other provisions of • the Constitution and hence a juristic entity which may be "State" for the purpose of Parts III and IV would not be so for the purpose of Part XIV or any other provision of the Constitution. That is why the decisions of this Court in S. L. Aggarwal v. Hindustan Steel Ltd. (1) and other cases involving the applicability of Article 311 have no relevance to the issue before us. The learned counsel appearing on behalf of the respondents Nos. 6 to 8, however, relied strongly on the decision in Sabhajit Tewary v. Union of India & Ors(') and contended that this decision laid down in no uncertain terms that a society registered under the Societies Registration Act, 1860 can never be regarded as an "authority" within the meaning of Article 12. This being .

a decision given by a Bench of live Judges of this Court is undoubtedly binding upon us but we do not think it lays down any such proposition as is contended on behalf of the respondents. The question which arose in this case was as to whether the Council of Scientific and Industrial Research which was juridjfa1ly a society registered under the Societies Registration Act, 1860 was an "authority" within the meaning of Article 12. The test which the Court applied for determining this question was the same as the one laid down in the International Airport Authority's case and approved by us, namely, whether the Council was an instrumentality or , agency of the Government. The Court implicitly assented to the proposition that if the Council were an agency of the Government, it would undoubtedly be an "authority". But, having regard to the various II (1) [1970] 3 S. C. R. 365. (2) [1975] 3 S. C. R. 616. AJAY HASIA v. KHALID MUJIIl (Bhagwati, J.

) 99 features enumerated in the judgment, the Court held that the Council was not an agency of the Government and hence could not be regarded as an "authority". The Court did not rest its conclusion on the ground that the Council was a society registered under the Societies Registration Act, 1860, but proceeded to consider various other features of the Council for arriving at the conclusion that it was not an agency of the Government and therefore not an "authority". This would have been totally unnecessary if the view of the Court were that a society registered under the Societies Registration Act can never be an "authority" within the meaning of Article 12. .. M' The decision in Sukhdev Singh v. Bhagat Ram (1975) 3 SCR 619 was also strongly relied upon ·by the learned counsel for respqndents Nos.

6 to 8 but we fail to see how this decision can assist the respondents in repelling the reasoning in the International Airport Authority's case or contending that a company or society formed under statute can never come within the meaning of the expression "authority" in Article 12. That was a case relating to three juristic bodies, namely, the Oil and Natural Gas Commission, the Industrial Finance Corporation and the Life Insurance Corporation and the question was whether they were "State" under Article 12. Each of these three juristic bodies was a corporation created by a statute and the Court by majority held that they were "authorities" and therefore "State" within the meaning of Article 12. The Court in this case was not concem~d with the question whether a company or society formed under a statute can be an "authority" or not and this decision does not therefore contain anything which might even remotely suggest that such a company or society can never be an "authority".

On the contrary, the thrust of the logic in the decision, far from being restrictive, applies to all juristic persons alike, irrespective whether they are created by a statute or formed under a statute. It is in the light of this discussion that we must now proceed to examine whether the Society in the present case is an "authority" falling within the definition of "State" in Article 12. Is it an instrumentality or agency of the Government'? The answer must obviously be in the affirmative if we have regard to the Memorandum Cif Association and the Rules of the Society. The composition of the Society is dominated by the representatives appointed by the Cetitfal ' Government and the Governments of Jammu & Kashmir, Punjab, Rajasthan and Uttar Pradesh with the approval of the Central Government. The monies required for running the college are provided entirely by the Central Government and the Government of Jammu .

& Kashmir and even if any other monies are to• be received by the Society, it can be done only with the approval of the State and the Central Governments. The Rules to be made by the Society are slsci required to have the prior approval of the State and the Central Gov ernments and the accounts of the Society have also to be submitted to both the Governments for their scrutiny and satisfaction. The Society is also to comply with all such directions as may be issued by the State Government with the approval of the Central Government in respect of any matters dealt with in the report of the Reviewing Committee. The control of the State and the Central Governments is indeed so deep and pervasive that no immovable property of the Society can be disposed of in any manner without the approval of both the Govern" ments.

The State and the Central Govermnents have even the power to appoint any other person or persons to be members of the Society and any member of the Society other than a member representing the State or the Central Government can be removed from the member ; ship of the Society by the State Government with the approval of the Central Government. The Board of Governors, which is in charge of general superintendence, direction and control of the affairs of Society and of its income and property is also largely controlled by nominies . of the State and the Central Governments. It will thus be seen that the State Government and by reason of the provision for approval, the Central Government also, have full control of the working of the Society and it would not be incorrect to say that the Society is merely a projection of the State and the Central Govern ments and to use the words of Ray, C. J.

in Sukhdev Singh's case (supra), the voice is that of the State and the Central Governments and the bands are also of the State and the Central Governments. We must, therefpre, hold that the Society is an instrumentality or agency of the State and the Central Governn1•::'nts and it is an 'authority' within the meaning of Art. 12. If the Society is an "authority" and therefore "State" within the 1 meaning of Article 12, it must follow that it is subject to the consti tutional obligation under Article 14. The true scope and ambit of Article 14 has been the subject matter of numerous decisions and it is not necessary to make any detailed reference '. ° them. It is suffi cient to state that the content and reach of Article 14 must not be confused with the doctrine of classification. Unfortunately, in the 14 came early stages of the evolution of our constitutional law, Article .

view to be identified with the doctrine of classification because the and there would taken was that that Article forbids discrimination making the differentia be no discrimination where the classification - (i) that the. classification is foun ded fulfils two conditions, namely, . distinsnishes persons or things on an intelligible differentia which A. JAY HASJA v. KHALID MU. JIB (Bhagwati, J. ) 101 that nre grouped together from others left out of the group; and (ii) that that differentia has a rational relation to the object sought to be achieved by. the impugned legislative or executive action. It was for the first time in E. P. Royappa v, State of Tamil Nad! t(I) that this Court laid bare a new dimension of Article 14 and pointed out that that Article has highly activist magnitude and it embodies guarantee against arbitrariness. This Court speaking through one of us (Bhagwati, J.

) said : "The basic principle which therefore informs both Articles 14 and 16 is equality and inhibition against discri -1 I mination. Now, what is the content and reach of this great equalising principle ? It is a founding faith, to use the words of Bose, J. , "a way of life", and it must not be sub jected to a narrow pedantic or lexicographic approach. We cannot countenance any attempt to truncate its all-embrac ing scope and meaning, for to do so would be to violate its activist magnitude. Equality is a dynamic concept with many aspects and dimensions and it cannot be "cribbled, cabined and confined" within traditional and doctrinaire limits. From a positivistic point of view, equality is anti thetic to arbitrariness. In fact, equality and arbitrariness are sworn enemies; one belongs to the rule of law in a republic while the other, to the whim and caprice of an absolute monarch.

Where an act is arbitrary it is implicit in it that it is unequal both according to political logic and constitutional law and is therefore violative of Art. 14, and if it affects any mat. t_er relating to public employment, it is also violative of Art. 16. Articles 14 and 16 strike at arbitrariness in State action and ensure fairness and equality of treatment. " This vital and dynamic aspect which was till then lying latent and submerged in the few simple but pregnant words of Article 14 was explored and brought to light in Royappa's case and it was re affirmed and elaborated by this Court in Maneka Gandhi v. Union of India(') where this Court again speaking through one of us (Bhag wati, J,) observed : "Now the question immediately arises as to what is the requirement of Article 14 : what is the content and reach of the great equalising principle enunCiated in this article ? There can be no doubt that it is a founding faith of the (I) [1974] 2 S. C. R. 348. (2) [1978] 2 S. C. R. 621.

Constitution. It is indeed the pillar on which rests securely the foundation of our democratic republic. And, therefore, it must not be subjected to a narrow, pedantic or lexicographic approach. No attempt sliould be made to truncate its all-embracing scope and meaning for, to do so would be to violate its activist magnitude. Equality is a dynamic concept with many aspects and dimens_ions and it cannot be imprisoned within traditional and doctrinaire limits ..... . . . . . . . . . Article 14 strikes at arbitrariness in State action arid ensures fairness and equality of treatment. The principle of reasonableness, which legally as well as philosophically, is an essential element of equality or nonarbitrariness pervades Article 14 like a brooding omnipresence. " This was again reiterated by this Court in lnt~rnational Airport Authority's case (supra) at page 1042 of the Report.

It must therefore now be taken to be well settled that what Article 14 strikes at is arbitrariness because any action that is arbitrary, must necessarily involve negation of equality. The doctrine of classification which is evolved by the courts is not para-phrase of Article 14 nor is it the objective and end of that Article. It is merely a judicial formula for determining whether the legislative or executive action in question is arbitrary and therefore constituting denial of equality. If the classification is not reasonable and does not satisfy the two conditions . referred to above, the impugned legislative or executive action would plainly be arbitrary and the guarantee of equality under Article 14 would be breached. Wherever therefore there is arbitrariness in State action whether it be of the legislature or of the executive or of an "authority" under Article 12, Article 14 immediately springs into action and strikes down such State action.

In fact, the concept of reasonableness and non-arbitrariness pervades the entire constitutional scheme and is a golden thread which runs through the whole of the fabric of the Constitution. · We may now turn to the merits of the controversy between the parties. Though several contentions were urged in the writ petitions, challenging the validity of the admisisons made to the college, they were not all pressed before us and the principal contention that was advanced was that the society acted arbitrarily in the matter of granting of admissions, first by ignoring the marks obtained by the candidates at the qualifying examination; secondly by relying on viva voce examination as a test for determining comparative merit of the candidates; thirdly by allocating as many as 50 marks for the viva voce examination as against 100 marks allocated for the written test and AJAY IIASIA v. KHALID MUJIB (Bhagwati, J.

) 103 lastly, by holding superficial interviews lasting only 2 or 3 minutes on an average and-asking questions which had no relevance to assessment of the suitability of the candidates with reference to the four factors required to be considered at the viva voce examination. Now so far as the challenge on the first count is concerned, we do not think it is at all well-founded. It is difficult to appreciate how a procedure for admission which does not take into account the marks obtained at the qualifying examination, but prefers to test the comparative merit of the candidates by insisting on an entrance examination can ever be said to be arbitrary. It has been pointed o'ut in the counter affidavit filed by H. L.

Chowdhury on behalf of the college that there are two universities on two different dates and the examination by the (' Board of Secondary Education for Jammu is also held on a different date than the examination by the Board of Secondary Education for Kashmir and the results of these examinations are not always declared before the admissions to the college can be decided. The College being the only institution for education in engineering courses in the State of Jammn & Kashmir has to cater to the needs of both the regions and it has, therefore, found it necessary and expedient to regulate admissions by holding an entrance test, so that the admission process may not be held up on account of late declaration of results of the qualifying examination in either of the two regions.

The entrance test also facilitates the assessment of the comparative talent of the candidates by application of a uniform standard and is always preferable to evaluation of comparative merit on the basis of marks obtained at the qualifying examination, when the qualifying examination is held by two or more different authorites, because lack of uniformity is bound to creep into the assessment of candidates by different authorities with different modes of examination. We would not, therefore, regard the procedure adopted by the society as arbit- II' rary merely because it refused to take into account the marks obtained by the candidates at the qualifying examination, but chose to regulate the admissions by relying on the entrance test. , The second ground of challenge questioned the validity of viva voce examination as a permissible test for selection of candidates for admission to a college.

The contention of the petitioners under this ground of challenge was that viva voce examination does not afford a proper criterion for assessment of the suitability: of the candidates for admission and it is a highly subjective and impressionistic test where the result is likely to be influenced by many uncertain and imponderable factors such as predelictions and prejudices of the interviewers, his attitudes and approaches, his pre-conceived notions and idiosyncrasies and it is also capable of abuse because it leaves scope for discrimination, manipulation and nepotism which can remain undetected nnder the cover of an interview and moreover it is not possible to assess the capacity and calibre of a candidate in the course of an interview lasting only for a few minutes and, therefore, selections made on the basis of oral interview must be regarded as arbitrary and hence voilative of Art. 14.

Now this criticism cannot be said to be wholly unfounded and it reflects a point of view which has certainly some validity. We may quote the following passage from the book on "Public Administration in Theory and Practice" by M. P. Sharma which voices a far and balanced criticism of the oral interview method "The oral test of the interview has been much criticised on the ground of its subjectivity and uncertainty. Different interviews have their own notions of good personality. Far some, it consists more in attractive physical appearance and dress rather than anything else, and with them the breezy and shiny type of candidate scores highly while the rough uncut diamonds may go unappreciated. The atmosphere of the interview is artificial and prevents some candidates from appearing at their best. Its duration is short, the few questions of the hit-or-miss type, which are put, may fail to reveal the real worth of the candidate.

It has been said that Gad takes a whole life time to judge a man's worth while interviewers have to do it in a quarter of an hour. Even at it's best, the common sort of interview reveals but the superficial aspects of the candidate's personality like appearance, speaking power, and general address. Deeper traits of leadership, tact, forcefulness, etc. go largely undetected. The Interview is often in the nature of desullory conversation. Marking differs greatly from examiner to examiner. An anal¥sis of the interview results show that the marks awarded to candidates who competed more than once for the same service vary surprisingly. All this shows that there is a great clement of chance in the interview test. This becomes a serious matter when the marks assigned to oral test constitute a high proportion of the total marks in the competition.

01 Glenn Stahl points out in his book on "Public Personnel Administration" that there are three disadvantages from which the oral test II method suffers, namely, "{1) the difficulty of developing valid and reliable oral tests; (2) the difficulty of securing a reviewable record on an oral test; and (3) public suspicion of the oral test as a channel AJAY IIASIA v. KIIALID MUJl1' (Bhagwati, J. ) 105 for the exertion of political influence" and we may add, other corrupt, nepotistic or extraneous considerations. The learned author then proceeds to add in a highly perceptive and critical passage : "The oral examination has failed in the past in direct proportion to the extent of its misuse. It is a delicate inst_r:ument and, in inexpert hands, a dangerous one. The first condition of its successful use is the full recognition of its limitations. One of the most P.

rolific sources of error in the oral has been the failure on the part of examiners to understand the nature of evidence and to discrimina. te between that which _was relevant, material and reliable and that which was not. It also must be remembered tll'at the best oral interview provides opportunity for analysis of only a very small part of a person's total behaviour. Generalizations from a single interview regarding an individual's total personality pattern -have been proved repeatedly to be wrong. " But, despite all this cnt1c1sm, the oral interview method continues to be very much in vogue as a supplementary test for assessing the suitability of candidates wherever test of personal traits is considered essential. Its relevance as a test for determining suitability based on personal cl:raracteristics has been recognised in a number of decisions of this Court which are binding upon us. In the first case on the point which came before this Court, namely, R. Chitra Lekha and Others v.

State of Mysore and Others(') this Court pointed out : "In the field of education there are diver_gent views as regards the mode of testing the capacity and calibre of students in the matter of admissions to colleges. Orthodox educationists stand by the marks obtained by a student in the annual examination. The modem trend of opinion insists • upon other additional tests, such as interview, performance in extra-curricular activities, personality test, psychiatric tests e\c. Obviously we are not in a position to judge which method is preferable or which test is the correc:t one ..... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The scheme of selection, however, perf~t it may be on paper, may be abused ... in practice. That it is capable of abuse is not a ground for quashing it. So long as the order lays down relevant objective criteria and entrusts the business of selection to quali- (1) [1964] 6 S. C. R. 368. -.

;--~ lied persons, this Court cannot obviously have any say in the matter. and on this view refused to hold the oral interview test as irrelevant or arbitrary. It was also pointed out by this Court in A. Peeriakaruppan v. State of Tamil Nadu & Ors:(') "In most cases, the first impression need not necessarily be the past impression, but under the existing conditions, we are unable to accede to the . contentions of the petitioners that the system of interview as in vogue in this• country is so defective as to make it useless. " It is therefore not possible. to accept the contentions of the petitioners that the oral interview test is so defective that selecting candidates for admission on the basis of oral interview in addition to written test must be regarded as arbitrary.

The oral interview test is undoubtedly not a very satisfactory test for assessing and evaluating the capacity and calibre of candidates, but in the absence of any better test for measuring personal characteristics and traits, the oral interview test must, at the present stage, be regarded as not irrational or irrelevant though it is snbjective and based on first impression, its result is influenced by many uncertain factors and it is capable of abuse. We would, however, like to point out that in the matter of admission to college or even in the matter of public employment, the oral interview test as presently held should not be relied upon as an exclusive test, but it may be resorted to only as an additional or supplementary test and, moreover, great care must be taken to see that persons who are appointed to conduct the oral interview test are men of high integrity, calibre and qualification.

· So far as the third ground of challenge is concerned, we do not think it can be dismissed as unsubstantial. The argument of the petitioners under this head of challenge was that even if oral interview may be regarded in principle as a valid test for selection of candidates for admission to a college, it was in the present case arbitrary and • unreasonable since the marks allocated for the oral interview were very much on the higher side as compared with the marks allocated for the • written test. The marks allocated for ~ oral interview were 50 as against 100 allocated for the written test, so that the mark. allocated for the oral interview carne to 33 1/3 % of the total number of marks taken into account for the purpose of making the selection. This, contended the petitioners, was beyond all reasonable proportion and rendered the selection of the candidates arbitrary and violative of the equality clause of the Constitution. Now there can be no doubt that, (! ) [1971] 2 S. C. R.

430. AJAY HASIA v. KHALID MUJIB (Bhagwati, !. ) 107 having regard to the drawbacks and deficiencies in the oral interview test and the conditions prevailing in the country, particularly when there is deterioration in moral values and corruption and nepotism are ve1y much on the increase, allocation of a high percentage of marks for the oral interview as compared to the marks allocated for the written test, cannot be accepted by the Court as free frorn the vice of arbitrariness. It may be pointed out that even in Peeriakaruppan's case (supra), where 75 marks out of a total of 275 marks were allocated for the oral interview, this Court observed that the marks allocated for interview were on the highside. This Court also observed in Miss Nishi Maghu's case (supra): "Reserving 50 marks for interview out of a total of 150... does seem excessive, especially when the time spent was not more than 4 minutes on each candidate".

There can be no doubt that allocating 33 1/3 of the total marks for oral interview is plainJy arbitrary and unreasonable. It is significant to note that even for selection of candidates for the Indian Administrative Service, the Indian Foreign Service and the Indian Police Service, where the personality of the candidate and his perso! J. al characteristics and traits are extremely relevant for the purpose of se]ection, the marks allocated for oral interview are 250 as against 1800 marks for the written examination, constituting only 12. 2% of the total marks taken into consideration for the purpose of making the selection. We must, therefore, regard the allocation of as high a percentage as 33 1/3 of the total marks for the oral interview as infecting the admission procedure with the vice of arbitrariness and selection of candidates made on the basis of such admission procedure cannot be sustained.

But we do not think we would be justified iri the exercise of our discretion in setting aside the selections made for the academic year 1979-80 after the lapse of a period of about 18 months, since to do so woul~ be to cause immense hardship to those students in whose case the validity of the selection cannot otherwise be questioned and who have nearly completed three semesters and, moreover, even if the petitioners are ultimately found to be deserving of selection on Jhe application of the proper test, it would not be possible to restore them! to the position as if they were admitted for the academic year 1979-80, which has run out long since.

It is true there is an allegation of mala fides against the Committee which interviewed the candidates and we may concede that if this allegation were established, we might have been inclined to interfere with the selections even after the lapse of a period of 18 months, because the writ petitions were filed as early as October- November, 1979 and merely because the Court could not take-up the hearing of the writ petitions for such along time should be no ground for denying relief to the petitioners, if they are otherwise so entitled. But we do not think that on the material placed before us we call 8-1281 SCI/80 sustain the allegation of mala fides against the: Committee.

It is true, and this is a rather disturbing feature of the present cases, that a large number of successful candidates succeeded in obtaining admission to the college by virtue of very high marks obtained by them at the viva voce examination tilted the balance in their favour, though _the marks secured by them at the qualifying examination were much less than . B those obtaiued by the petitioners and even in the written test, they had fared much worse than the petitioners. It is clear from the chart submitted to us on behalf of the petitioners that the marks awarded at the interview are by and large in inverse proportion to the marks obtained by the candidates at the qualifying examination and are also, in a large number of cases, not commensurate with the marks obtained in the written test.

The chart does create a strong suspicion in our mind that the marks awarded at the viva voce examination might have been manipulated with a view to favouring the candidates who ultimately came to be selected, but suspicion cannot take the place of proof and we cannot hold the plea of mala fides to be established. We need much more cogent material before we can hold that the Committee deliberately manipulated the marks at the viva voce examination with a view to favouring certain candidates as aganist the petitioners. We cannot, however, fail to mention that this is a matter which required to be looked into very carefully and not only the State Government, but also the Central Government which is equally responsible for the proper running of the colI~ge, must take care to see that proper persons are appointed on the interviewing committees and there is no executive interference with their decision-making process.

We may also caution the authorities that though, in the present case, for reasons which we have already given, we are not interfering with the selection for the academic year 1979-80, the selections made for the subsequent academic years would run the risk of invalidation if such a high per· centage of marks is allocated for the oral interview. We are of the view that, under the existing circumstances, allocation of more than 15 % of the total marks for the oral interview would be arbitrary and unreasonable and would be liable to be struck down as constitutionally • invalid.

The petitioners, arguing under the last ground of challenge, urged that the oral interview as conducted in the present case was a mere pretence or farce, as it did not last for more than 2 or 3 minutes per candidate on an average and the questions which were asked were ) formal questions relating to parentage and residence of the candidate and hardly any question was asked which bad relevance to assessment of the suitability of the candidate with reference to any of the four factors required to be considered by the Committee. When the time spent on each candidate was not more 2 or 3 minutes on an average, AJAY RASIA v. KHALID MUJIB (Bhagwati, J. ) I 09 contended the petitioners, how could the suitability of the candidate be assessed on a consideration of the relevant factors by holding such . an interview and how could the Committee possibly judge the merit of the candidate with reference to these factors when no questions bearing on these factors were asked to the candidate.

Now there can be no doubt that if the interview did not take more than 2 or 3 minutes on an average and the questions asked had no bearing on the factors required to be taken into account, the oral interview test would be vitiated, because it would be impossible in such an interview to assess the merit of a candidate with reference to these factors. This allega- ¥ tion of the petitioners has been denied in the affidavit in reply filed by H. L. Chowdhury on behalf of the college and it ha~ been stated that each candidate was interviewed for 6 to 8 minutes and "only the relevant questions on the aforesaid subjects were asked". If this statement of H. L. Chowdhury is correct, we cannot find much fault with the oral interview test held by the Committee. But we do not think we can act on this staten;ient made by H. L.

Chowdhury, because there is nothing to show that he was present at the interviews and none of the three Committee members has come forward to make an affidavit denying the allegation of the petitioners and stating that each candidate was interviewed for 6 to 8 minutes and only relevant questions were asked. We must therefore, proceed on the basis that the interview of each candidate did not last for more than 2 or 3 minutes on an average and hardly any questions were asked having bearing on the relevant factors. If that be so, the oral interview test must be held to be vitiated and the selection made on the basis of such test must be held to be arbitrary.

We are, however, not inclined for reasons already given, to set aside the selection made for the academic year 1979-80, though we may caution the State Government and the Society that for the future academic years, selections may be made on -the basis of observation made by us in this judgment lest they might liln the risk of being struck down. We may point out that, in our opinion, if the marks allocated for the oral interview do not exceed 15 % of the total marks and the candidates are properly interviewed and relevant questions are asked with a view to assessing their suitability with reference to the factors require<J to be taken into consideration, t11e oral interview test would satisfy the criterion of reasonableness and non-arbitrariness.

We think that it would also be desirable if the interview of the candidates is tape-recorded, for in that event there will be contemporaneous evidence to show what were the questions asked to the candidates by the interviewing committee and what were the answers given and that will eliminate a lot of unnecessary controversy besides acting as a check on the possible arbitrariness of the interviewing committee. A We may point out that the State Government, the Society and the t College have agreed before us that the best fifty students, out of those who applied for admission for the academic year 1_979-80 and who • have failed to secure admission so far, will be granted admission for the academic year 1981-82 and· the seats allocated to them will be in addition to the normal intake of students in the College. We order B accordingly.

Subject to the above direction, the writ petitions are dismissed, but having regard to the facts and circumstances of the present cases, we think that a fair order of costs would be that each party should bear and pay its own costs of the writ petitions. -'"'c S. R. Petitions dismissed.