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APSRTC comes under State Government control: SC

Our Legal Correspondent

NEW DELHI, Dec. 24

THE Supreme Court has held that merely because a State Government establishes a corporation and that corporation is an establishment distinct from the State Government does not `ipso facto' mean that the corporation is not under the control of the State Government.

"It is, therefore, clear that the Andhra Pradesh State Road Transport Corporation is under the control of the State Government. The provisions of the Andhra Pradesh Factories and Establishment (National Festival and other Holidays) Act, 1974 would not be applicable to it by virtue of section 11(1)(c) of the Act", the court said.

The ruling was given by a division bench comprising Mr Justice S. Rajendra Babu and Mr Justice S.N. Variava while setting aside a judgement of the Andhra Pradesh High Court and allowing an appeal against it in the case of District Manager APSRTC, Vijayaw ada Vs. K. Sivaji and others.

The appellant corporation was established under Section 3 of the Road Transport Corporation Act, 1950. The respondents are employees of the corporation. They had filed an application under Section 15(2) of the Payment of Wages Act claiming wages for holi days declared under the 1974 Act.

The claim was contested by the appellant on the ground that the 1974 Act provided only seven days holiday whereas they had already granted 15 days holiday. The appellant also contended that by the virtue of section (11)(1)(c) of the 1974 Act, the provisi ons of the Act were not applicable to it.

The appellate authority did not accept the contentions of the appellant-corporation and directed it to make payment for the work done by the respondents on holidays declared under the 1974 Act.

An appeal filed by the appellant-corporation was also dismissed. The appellant-corporation, therefore, filed a writ petition in the High Court, which came to be disposed of by a judgement dated August 5, 1986. The High Court held that the appellant-corpo ration was not under the control of the Central or the State Government and, therefore, the provisions of the 1974 Act were not applicable to it.

The High Court held that even though an institution might be treated as a State within the meaning of Article 12 of the Constitution, it did not necessarily mean that it was under the control of the State Government or the Central Government as the case might be. The High Court relied on section 68-A of the Motor Vehicles Act, 1988 and concluded from this provision that the Road Transport Corporation established under section 3 of the Road Transport Corporation Act was distinct from the Central or the S tate governments. Hence, the appeal before the apex court.

The Supreme Court, in its judgement, held that the decision of a larger bench of the High Court that if an establishment was a State within the meaning of Article 12 of the Constitution, then it was under the control of the Government for the purposes of section 11(1)(c) was not based upon an examination of the memorandum of articles of association of the appellant corporation. This decision was binding on the single judge of the High Court hearing the writ petition.

"Judicial discipline required that the single judge either followed it or referred the matter to a larger bench. Sitting singly, the judge could not have taken a different view on the specious ground that the decision was based on facts. It must be point ed out that as even on the facts the conclusion of the single judge is unsustainable", the judges observed.

"We, therefore," the judges said, "fail to see as to how an establishment, which is deemed to be a State within the meaning of article 12 of the Constitution would not be under the control of the Government for the purposes of section 11(1)(c) of the 197 4 Act."