IIM Kozhikode Not Instrumentality Of State Under Article 12 Of Constitution; Writ Petition Over Service Dispute Not Maintainable : Kerala High Court

The Kerala High Court on Monday held that IIM, Kozhikode being an autonomous body as per the Indian Institute of Management Act, 2017 and there being no statutory rules with regard to the service conditions of the employees of the institute, the writ jurisdiction of the High Court under Article 226 cannot be invoked for grant of relief.

A single bench of Justice Anu Sivaraman observed that IIM Kozhikode is an autonomous institution and would not come under the ambit of ‘State’ under Article 12:

“….the contention that the IIM, Kozhikode would answer the definition of State or “Instrumentality of State” under Article 12 of the Constitution of India cannot be accepted. Though the constitution of the governing body appears to be by way of nomination, the institute is specifically intended to be an autonomous institution. It is true that the institute is performing the duty of imparting education in management and carrying out research in the field. However, there is no monopoly intended to be created either by the Statute or by any other means in favour of such institutes in the matter of imparting of management education. The Institute is not a creature of the Statute, since it was a society whose functions were brought under the purview of 2017 Act.”

The Court was considering the plea of the petitioner who was discharged from service as Chief Finance Officer of the institute on account of unsatisfactory performance. The Court considered the question of whether the its jurisdiction under Article 226 could be exercised in the matter of discharge of a probationer from service when the institute is an autonomous body without any statutory inhibitions cast on it.

The Court observed that there was no deep and pervasive control of the State on the affairs of the institute to bring it within the ambit of Article 12:

“It is clear from the materials placed on record by the respondents that the funds made available by the Government do not constitute a substantial amount so as to meet even a major portion of the expenditure of the institute. A reading of the provisions of the Act and the Regulations would make it clear that there is no control contemplated on the internal administration of the institute by the Central Government. There are also no statutory rules with regard to the service conditions of the employees of the institute. The provision for placing the accounts before the Comptroller and Auditor General and to obtain prior approval from the Government in case of alienation of immovable property, in case the land was provided of free of cost by a State Government or a Central Government, would not be sufficient to hold that there is deep and pervasive State control of the affairs of the institute so as to bring it within the ambit of Article 12.”

According to the factual matrix of the case, due to some accounting irregularities in the accounts maintained by the petitioner, an enquiry was initiated and she was asked to take leave to avoid tampering of evidentiary documents. Further, on account of more irregularities that surfaced during the enquiry, the petitioner was relieved from her post.

The Institute argued that IIM Kozhikode is not a ‘State’ or other ‘authority’ under Article 12 of the Constitution and hence the writ petition is not maintainable. It was contended that the Institute is not performing any public function to come under the definition of “State”. The Respondents also contended that the institution is financially independent and has an audit system comparable to private organizations. It was also submitted that the 2017 Act allows the institute to receive gifts, grants and contributions to meet its expenses and these accounts are subject to the audit of Comptroller and Auditor General of India, but only for the purpose of verifying the expenditure of grants given by the Government. With respect to employment, the institute is an autonomous body and not amenable to writ jurisdiction of the High Court it was argued.

However, the petitioner contended that the power under Article 226 is not limited to statutory authorities or instrumentalities of the State and can be issued to an authority performing a public duty. As the imparting of management education is a public duty, a writ would be maintainable against it, the petitioner argued.

The petitioner contended that the institute had adopted the Central Civil Services Rules to govern the service conditions of its employees. The petitioner argued that her discharge from service is punitive and against the Rules. It has been passed without application of mind and hence she is entitled to protection under Article 311 of the Constitution, it was argued. The Respondents argued that the petitioner was on probation due to which her service could be terminated at any point. The Respondents contended that the termination was not punitive and would only count as termination of probation.

The Court observed that according to settled position of law, a writ would be maintainable for enforcing a statutory duty or a public duty even if the authority in question does not fall under the ambit of State under Article 12. However, the Court held that with the 2017 Act, the Institute has become a wholly autonomous body with no substantial governmental interference in its internal administration and hence the writ is not maintainable:

“It is true that a writ would be issued to the IIM, even if it does not answer the definition of State or its instrumentality under Article 12 in case there is any infringement of the statutory provisions or if there is any violation of the fundamental rights in the case of grant of admission or any of the matters directly covered by the 2017 Act. However, in the factual situation available in the instant case, I am of the opinion that it would not be possible for this Court to exercise jurisdiction and enter into the controversy whether the order of termination of the petitioner was a termination of Probation Simplicitor or whether it amounted to a punitive termination without following the due procedure provided in the CCS Rules, which have been made applicable by adoption.”

The court clarified that it has only considered the maintainability of the petition and that it has not ventured into the facts of the case. “In case the petitioner has any statutory or civil remedy, the time spent before this Court in pursuing this writ petition will essentially be deducted to enable the petitioner to avail such remedy as available to her under law” the Court stated.

Case Title: Shiny George Ambat V. Union of India

Citation: 2023 LiveLaw (Ker) 270

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