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Vartika Roseline Claudius v/s Birla Sun Life Insurance Company Ltd. & Others


Company & Directors' Information:- BIRLA CORPORATION LIMITED [Active] CIN = L01132WB1919PLC003334

    Service Single No. 3684 of 2016

    Decided On, 08 April 2016

    At, High Court Of Judicature At Allahabad Lucknow Bench

    By, THE HONOURABLE MR. JUSTICE RAJAN ROY

    For the Petitioner: Ghaus Beg, SC. For the Respondents: -------



Judgment Text

Rajan Roy, J.

1. Heard learned counsel for the petitioner.

2. The petitioner herein is an employee of the Birla Sun Life Insurance Company Limited which is alleged to be a public limited company incorporated as per the provisions of the Companies Act.

3. The petitioner herein has challenged the order of termination of her services dated 07.11.2015 passed by the Vice President and Head-Sales H.R. of the aforesaid company.

4. The first and foremost question which arises for consideration before this Court is as to whether this writ petition under Article 226 of the Constitution of India is maintainable, in respect of the subject matter in issue, against the aforesaid company.

5. A writ petition under Article 32 of the Constitution of India is filed before the Supreme Court for enforcement of fundamental rights whereas writ petitions under Article 226 of the Constitution of India can be filed for enforcement of fundamental rights as also other legal rights. Part-III of the Constitution of India containing the fundamental rights is attracted against the State or is instrumentalities as mentioned in Article 12 of the Constitution but not against private bodies.

6. In paragraph no. 3 and 4 of the writ petition the petitioner has stated as under:-

"3. That at the outset, it is submitted that Birla Sun Life Insurance Company Limited is a public limited company under the Companies Act and, is a India's leading financial services company and is a joint venture between the Aditya Birla Group, a globally trusted multinational company and Sun Life Financial Insurance. The Birla Sun Life Insurance Company Limited is contributed to growth and development of Indian life insurance industry. It is relevant to mention here that the Birla Sun Life Insurance Company Limited is registered and governed by the provisions contained under Insurance Regulatory & Development Authority of India Act, 1999 (hereinafter referred to as 'I.R.D.A.).

The aims and objectives of the I.R.D.A. is to provide for the establishment of an authority to protect the interest of holders of insurance policies, to regulate, promote and ensure orderly growth of the insurance industry and for matter connected therewith or incidental thereto and further to amend the Insurance Act 1938, the Life Insurance Corporation Act, 1956 and the General Insurance Business (Nationalisation) Act, 1972.

4. That in view of the aforesaid fact, the Birla Sun Life Insurance Company Limited is an instrumentality of the State and is covered under Article 12 of the Constitution of Indian, as it performs and discharges public duties, and as such, the Birla Sun Life Insurance Company Limited is amenable to writ jurisdiction under Article 226 of the Constitution of India."

7. The challenge to the order of termination is based on alleged violation of Clause 8 of the conditions contained in the appointment letter, which is alleged to be in violation of Article 14 and 16 of the Constitution of India as is evident from paragraph 13 and 15 of the writ petition. In paragraph 16 of the writ petition, it is said that Clause 8 of the appointment order is unreasonable being violative of Article 311 of the Constitution of India as also rules of natural justice. These have been reiterated in the grounds of challenge in the writ petition.

8. Undisputedly, as per the petitioner's own averment, the respondent company is a public limited company incorporated in accordance with the Companies Act. It is a financial service company and a joint venture between Aditya Birla Group and Sun Life Financial Insurance Limited. It is said to be registered and governed by the provisions of Insurance Regulatory and Development Authority of India Act, 1999 (hereinafter referred to as 'I.R.D.A.'). It is engaged in the activity of providing insurance to people. There is no averment in the writ petition that the Government, whether Central or State, has any holding in the Company nor that they have any role to play in its functioning. Insurance activity is neither part of the soverign nor welfare function of the State nor there is any such averment in this writ petition, therefore, it can not be said that the respondent company, in any manner, supplements the function of the State.

9. As far as the Act of 1999 is concerned, it is meant to provide for the establishment of an authority to protect the interest of holders of insurance policies, to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental thereto and further to amend the insurance Act, 1938, the Life Insurance Corporation Act, 1956 and the General Insurance Business (Nationalisation) Act, 1972.

10. Section 3 of the Act deals with establishment and incorporation of the Insurance Regulatory and Development Authority. The duty, powers and function of the authority are mentioned in Section 14 which nowhere provides for regulation by the said authority of the terms and conditions of service of employees of an insurance company such as the respondent. The Act deals only with regulation in the field of insurance. Section 24 refers to the power of the Central Government to make rules for carrying out the provisions of the said Act. It does not empower the Central Government to determine or regulate the terms and conditions of service of employees of insurance companies such as the respondent. Section 26 deals with the power of the authority to make regulation. It does not empower the authority to determine or regulate the terms and conditions of employees of the respondent company.

11. In fact there is no such averment in the writ petition except a bald assertion made in paragraph 4 of the writ petition that the respondent company is an instrumentality of State and is covered under Article 12 of the Constitution of India without disclosing the basis for this assertion which is apparently belied from the facts and reasons discussed in this judgment.

12. Shri Gaus Beg, learned counsel for the petitioner has relied upon the judgment of the Supreme Court rendered inRamesh Ahluwalia v. State of Punjab and others reported in (2012) 12 SCC 331(paragraph 14), the judgment of the Supreme Court dated15.12.2015 rendered in Civil Appeal No. 14553 of 2015, Dr. Janet Jeyapaul v. SRM University and Ors.. The judgment of the Supreme Court reported inAIR 1985 SC 364, Manmohan Singh Jaitla v. Commissioner, Union Territory, Chandigarh and othersandAmir Singh, v. Deputy Commissioner and othersand a judgment of this Court dated13.04.2012 rendered in Writ Petition No. 1014(MS) of 2012, Faraz Talha and others v. Union of India and othersto contend that the respondent company performs a public function, therefore, it is covered under the definition of State under Article 12 of the Constitution of India and the writ petition is maintainable in respect of the challenge contained herein.

13. All the above judgments relied upon by the learned counsel for the petitioner relate to educational institutions which undoubtedly perform a public function. The respondent company, however, is not engaged in educational activities. It is engaged in financial service/ insurance activities. The activity is purely a private one being performed by a public limited company without any role of the State in its functioning.

14. As far as the question of performing public function is concerned, the Supreme Court in the case ofK.K. Saxena v. International Commission on Irrigation and drainage reported in (2015) 1 SCC 369has considered the law on the subject in great detail.

15. In para 39 of the said judgment the Supreme Court considered the earlier decision in Ahmad Basi Reddy wherein it was observed that the public function and public duty though not easy to define, it can reasonably be said that such functions are similar to or closely related to those performable by the State in its sovereignty capacity. A service voluntarily undertaken cannot be said to be public duty.

16. The Court in the case of K.K. Saksena (supra) observed that merely because activity being carried on enures to the benefit of the Indian public, it cannot be a guiding factor to determine the character of the institute and bring the same within the sweep of 'Public function or Public duty'. It referred to the earlier decision in the case ofFederal Bank v. Sagar Thamas reported in (2003) 10 SCC 733, in para 40, wherein the Court had culled out the categories of body/persons who would be amenable to writ jurisdiction of the High Court. One such category was a private body discharging public duty or positive obligation of public nature.

17. In paragraph 41 of K.K. Saxena the Supreme Court considered its earlier decision in the case ofBinny Ltd. v. V. Sadasivam reported in (2005)6 SCC 657, wherein it was clarified that though writ can be issued against any private body or person, the scope of mandamus is limited to enforcement of public duty. It is the nature of the duty performed by such person/body, which is the determinative factor as the court is to enforce the said duty and the identity of the authority against whom the right is sought is not relevant. Such duty can either be statutory or even otherwise, but there has to be a public law element in the action of that body.

18. After analysing the earlier decisions, the Supreme Court observed in paragraph 43 that even in such cases when a writ petition is maintainable under Article 226 a writ would not lie to enforce private law rights. A private law is that part of a legal system which is a part of common law that involves relationships between individuals, such as law of contract or torts. Therefore, even if writ petition would be maintainable against an authority before issuing any writ particularly the writ of mandamus the court has to satisfy that the action of such an authority which is challenged is in the domain of public law as distinguished from private law.

19. Further in Paragraph 44 of K.K. Saksena case(supra) their Lordships observed that power to issue writ or any order or direction for "any other purpose" has been held to be included in Article 226 of the Constitution with a view apparently to place all the High Court in this country in somewhat the same position as the Court of the King's Bench in England. It is for this reason ordinary "private law remedies" are not enforceable through extraordinary writ jurisdiction, even though brought against public authorities.

20. In paragraph 49 of the said judgment the Supreme Court high lighted the aspect that even if a body performing public duty is amenable to writ jurisdiction, all its decisions are not subject to judicial review. Only those decisions which have public element therein can be judicially reviewed under writ jurisdiction.

21. In paragraph 51 of the said judgment the Supreme Court referred to Anadi Mukta (supra) case and observed that though it was held in the case that "any other authority" mentioned in Article 226 is not confined to statutory authorities or instrumentality of the State defined under Article 12 of the Constitution, it also emphasised that if the rights are purely of a private character, no mandamus could issue.

22. The respondent company is not a statutory corporation nor it has been created for discharging public duties. It is a public company incorporated in accordance with the Companies Act and not established by any statute for performing a public duty. It is a business enterprise unrelated to the work of the Government. The relationship of the petitioner with the respondent company is a contractual one and not statutory. It does not have a public element.

23. The terms and conditions of employment of employees of the respondent company are governed by the conditions of their appointment as has been alleged in the writ petition itself and there are no

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statutory rules in this regard. Article 14 and 16 are attracted only in matters pertaining to the State and its instrumentalities and not against private bodies such as the respondent company. Article 311 has absolutely no application in the matter as the said provision also relates to a person holding a civil post under the State which the petitioner does not. 24. Articles 14, 16 and 311 of the Constitution have absolutely no role to play in the facts of the present case. The dispute herein is purely a private dispute between the petitioner and the respondent company there being no public law element involved. 25. In view of the above, the respondent company can not be said to be performing a public function so as to be amenable the writ jurisdiction under Article 226 of the Constitution of India. Even assuming that it does, the question still remains whether a writ of certiorari or mandamus could be issued as has been prayed for in this writ petition in the absence of violation of any statutory provision or positive obligation based on public law. The answer has to be in the negative. 26. In these circumstances and for the reasons mentioned herein above, this writ petition is not maintainable. It is accordingly, dismissed. There shall be no orders as to costs. Petition dismissed.
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