Case analysis on D. R. Gurushantappa v. Abdul Khuddus Anwar

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Statement Of Facts

The state government allotted an undertaking to respondent no.1 that was fully controlled and managed by the state government. Later on, the undertaking is taken over by a registered company. The shareholders of the company were government and few government officers. The company was composed of directors and the secretary’s minister was appointed as one of the directors and the government’s approval was taken when the secretary was appointed and also for the operational working of the company. Government has the power which is to issue directions in the working activities to the directors. The service of respondent no.1 was in continuation even after the undertaking is taken over by a company and there was a lack of fresh contract he continued to be worked on the same post. Later on, the promotion is given to him and later on, he contended for the seat of state legislative assembly. Appellant was also a contestant in the election but he was unsuccessful, he challenged the elections.

His contentions were-:

(i) “That the first respondent when initially appointed to the post was a government servant arid, even after that concern was taken over by the company, he continued to be in the service of the  Government.            

Procedural History

Civil Appellate Jurisdiction

The election petition is filed by an unsuccessful candidate to the High Court “Civil Appeal No. 718 of 1968. An appeal under s. 116-A of the Representation of the People Act, 1951 from the judgment and order dated November 17, 1967, of the Mysore High Court in Election Petition No. 7 of 1967.”[2]The matter was gone directly to High Court and then by the virtue of Article 116-A the appeal lied to the Supreme Court. This case was decided by the Supreme Court on 27 January 1969.

On 5th April 1967 Petitioner, an unsuccessful election candidate of the Legislative Assembly of Bhadravati Constituency for granting the order to set aside the election of the Respondent claiming that he holds an office of profit and he is unsuccessful. The petition was dismissed by the High Court election.

Supreme Court

17th November,1967-Petitioner appealed to the High Court by the virtue of Article 116-A of the Indian Constitution. High Court dismissed the petitioner’s claim.

High Court Judgement

The High Court held, in this case, the petition was dismissed by the High court and High Court clearly said that the Respondent under the state government is not holding any office of profit and he is qualified as a member of Legislative Assembly to the fullest. The High Court held the following point-:

Ø  Under, Representation of the People’s Act section 10 says that the disqualification is limited to a person holding the office of a managing agent, manager or secretary of accompanying in the capital of which the Government has not less than 25%share, and the disqualification does not apply to other employees of the company.  [3]

Arguments

Arguments Of The Appellant-: 

The contention of the petitioner was that Respondent no. 1 is disqualified under section 191(1)(a) of The Constitution of India. The petitioner argued that-

  • When the appointment of the respondent no.1 taken place in the undertaking he was a government servant and later on the undertaking is acquired by a company. According to the appellant the Mysore government is the in charge of the service. 
  • Secondly, he contended that even if, the the respondent no.1 is not a government servant but practically, he is in the employment under state government of Mysore and handling the office of profit.
  • The continuation of service even after the concern is taken over by a company. There has to be a fresh contract entered.
  • He should be disqualified under Article 191(1)(a) of The Constitution of India because he is the holder of office of profits which makes him ineligible for the Legislative Assembly membership. 
  • Piercing in the veil of the company to being a different legal identity and a juristic person.
  •  The petitioner’s argued that principles of Gurugobinda Basu v. Sankari Prasad Ghosal and others held a differentiation between office of profits and a service post by government.

All the contentions of the Appellant failed.

Arguments Of The Respondent-:

  • Respondent no.1 is not holding any office of profit under the Indian Constitution and is eligible for the membership of Legislative Assembly because this provision only came in the position of president and vice president. In this case respondent’s office is under the company.
  •  Respondent contended and argued that in the case of Maulana Abdul Shakur v. Rikhab Chand and Anr. the court held that the appointment will be broken at the discretion.

Issues Raised

[Issue I] Whether The Respondent Is Holding Any Office Of Profit Under The State Government?

[Issue II] Whether The Respondent Is Eligible For The Post Of Member In The Legislative Assembly Or Not?

[Issue III] Whether There Is A Need Of Fresh Contract Or Not?

Ratio of the Judgement

Supreme Court in this case dismissed the appeal of the petitioner with the costs and held that-:

  • SC says there is no conclusion that Respondent is continued to be the government worker. After the takeover of the concern by the company it is a totally different entity and the company employees are ceased to be called as government employees as the undertaking happened.
  • The employees will no longer to be under the state regulations. The company was under certification of Industrial Employment (Standing Orders) Act, 1946.Also there was no need for a fresh contract to be entered specifically as the undertaking done. Government will not decide their duties, workings and regulations as the company was ceased to be the government company.
  • The state governor has authority over the company’s conditions and workings but it can’t be said that it was a government company. The inclusion of the name in the civil list is not the criteria to determine company’s employee’s status.
  • There is a lack of evidence to proof the status of the company. Court also given the example of university employees name on the civil list but it can’t be said that they are employee of the government. Hence, civil list cannot to be relied and the appellant contentions failed in the case.
  • The respondent relied on the Gurugobinda Basu case’s judgement in which the distinction made between office of profit and service or post of government and it says there is no need to be entered in a master servant relationship. Reference of Article 309 and 314 given.
  • Court contemplated the case decision of Maulana Abdul Shakur v. Rikhab Chand and Anr.  The same question was raised in this case too pointing towards the appellant’s appointment and his continuation to the office and he was employed as an auditor and comptroller.
  • The control amount that the government under any officer is also an consideration for determining the holder of office of profits. In this case the shares were also the subject matter for deciding the government control.
  • With the connection to this case Supreme Court made a comparison between Article 58(2) and 66(4) to help in this case significantly. These articles talk about eligibility of the president and vice president of our country for holding any office of profit. This is immaterial that office of profit is under government or any private authority. But it only applies to the president and the vice president. But in Article 102(1)(a) and 191 (1)(a) talks about membership of the house of parliament and the disqualification is only done when a individual holds the office of profit under the central, state or any local government and the office holding under any local authority does not grant any disqualification in this case.
  • Court also says that the Parliament, when passing the Act, didn’t think of it as important to exclude each individual holding an office of benefit under a Government Company. Yet, constrained the preclusion to people holding the workplace of overseeing specialist, director or secretary of the Company. The way that the whole offer capital in the Company for the situation before us is claimed by the Government doesn’t, as we would like to think, have any effect. Under the Articles of Association, obviously, however, at first, all offers were held by the Government, it is conceivable that private residents may likewise hold partakes in the Company. Indeed, there, are arrangements showing that offers held by specific investors can pass by progression to individuals from their family or can even be moved by blessing to them.

Bibliography

Statues referred

  • Representation of the People Act, 1951, No. 43, Acts of Parliament, 1951 (India).
  • The Indian Constitution, 1950 (India).
  • The Industrial Dispute Act, 1947, No. 14, Acts of Parliament, 1947 (India).
  • Industrial Employment (Standing Order) Act, 1946, No.20, Acts of Parliament (India).

Case laws cited

·      Gurugobinda  Basu v. Sankari Prasad Ghosal & Ors.  [1964]  4 S.C.R. 311 
·      Maulana Abdul Shakur v. Rikhab Chand,  [1958] S.C.R. 387

[1]D. R. Gurushantappa vs Abdul Khuddus Anwar & Ors on 27 January, 1969, https://indiankanoon.org/doc/1193968/ (last visited Apr 18, 2020).

[2]D. R. Gurushantappa vs Abdul Khuddus Anwar & Ors on 27 January, 1969, https://indiankanoon.org/doc/1193968/ (last visited Apr 18, 2020).

[3]Representation of the People Act, 1951, No. 43, Acts of Parliament, 1951 (India).

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