Shree Navkar Tradecom Pvt Limited & 9 vs Union Of India & 2 on 5 May, 2016

[Cites 20, Cited by 1]

Gujarat High Court

Shree Navkar Tradecom Pvt Limited & 9 vs Union Of India & 2 on 5 May, 2016

HC-NIC Page 1 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT All the petitioner companies, by means of the present petition and thereby invoking the writ jurisdiction of this Court under Article 226 of the Constitution, have prayed for issuance of writ of mandamus or direction to restrain the respondents from disconnecting the telecommunication services which are provided by the second and third respondent and their affiliates to the petitioners herein, who are the operators, for the services of Direct Inward Dialing (DID), Group Electronic Private Automatic Branch Exchange (EPBX) provided by the second respondent- licencee company. The second respondent who is Chief Executive Officer of Reliance Communications Limited and the third respondent who is Chief Executive Officer of the Gujarat Circle of the same company, as per the say of the petitioners, were set to disconnect the said services from 10th March, 2016 without giving prior intimation in writing. Therefore the present petition and this prayer.

2. Another prayer which was incorporated by amending the petition was for direction against the first respondent-Union of India through Secretary, Department of Telecom, Ministry of Communications, to order the second and third respondents to continue the telecommunication services provided by them to the petitioners and for further direction to restrain the said second and third private respondents from disconnecting the services in question. The other prayers were interim prayers. Thus in the originally initiated petition, writ was prayed against second and third respondent, whereas by amendment, additionally, Page 2 of 25 HC-NIC Page 2 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT it was prayed for against the first respondent-Union of India also.

2.1 The respondent Nos.2 and 3 filed Civil Application No.3732 of 2016 under Article 226(3) of the Constitution for vacating the ex-parte interim relief granted by this Court. In course of hearing of the said Civil Application on 26th April, 2016, learned counsels appearing for both the sides agreed and requested to take up the main matter for final consideration. On 02nd May, 2016 learned advocates for the parties were heard in extenso and as per their request and consent, the petition was finally heard.

3. The premise of facts on which the case of the petitioners and the prayers made are quite relevant to be outlined. It appears that between the petitioners and the private respondent company, an agreement called EPABX Operator Agreement in the nature of franchisee agreement was entered into. Thereunder the respondent Reliance company and the affiliates of Reliance have been granted licences for the purpose of providing telecommunication products and services in different places. The licencee was allowed to act by appointing private persons by entering into agreements. It is stated that the Reliance was inter alia desirous of providing such services through EPABX and for said purpose, it appointed operates-the petitioners herein who by mode of the aforesaid agreement, agreed to provide the said services in the areas mentioned in the Agreement. It is the case of the petitioners that in different cities such as Ahmedabad, Surat, Bhavnagar, Vadodara, Page 3 of 25 HC-NIC Page 3 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT they operate under the Agreement and started setting up group EPABX under the franchisee contract.

3.1 In view of a policy Scheme dated 27th January, 1994 by the Government of India whereunder the licence is permitted to a third person who act through private operator. They are permitted to install, maintain and operate including EPBAXs. Under the franchise, a licencee may enter into independent contract with private operator to provide telecom facilities. The conditions are prescribed to be included in the licencing agreement under the said policy circular dated 04th March, 1994. The petitioners herein are the operators who having entered into agreement with the private respondent company herein, and accordingly they provide telecom facilities of DID and Group EPBAX. It is averred in the paragraph 9, projecting a cause of action for instituting the petition, that few days back the petitioners came to know that the Reliance Communication Limited has decided to disconnect all DID and Group EPBAX services from 10th March, 2016. It is the say of the petitioners that Ahmedabad office orally conveyed to them that since a communication was received from the Head Office at Mumbai, in view of said intimation, services of all the operators around India were decided to be discontinued.

3.2 By filing affidavit-in-reply the respondents questioned the maintainability of the petition in two ways. Firstly, that the petitioners have raised a contractual dispute for which writ jurisdiction is not Page 4 of 25 HC-NIC Page 4 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT available. Second was that in view of Clause 14 of the Franchisee Agreement which is an arbitration clause, a writ petition cannot be entertained. It was thirdly contended with reference to the prayers inserted against Union of India that it was an indirect way of seeking prayers which otherwise not grantable.

4. Learned senior counsel Mr.R.R. Marshall with learned advocate Mr.Havewalla vehemently submitted that without giving any reason whatsoever, showing no ground and even without giving any prior notice, the services provided to the petitioners-operators would be snapped. It was submitted that the proposed abrupt discontinuation was arbitrary and called for interference by this Court.

4.1 Learned senior counsel for the petitioner relied on certain conditions which are prescribed to be incorporated in the licence agreement that all telephone connections of EPABX network will be governed by Indian Telegraph Act, 1985, that telecom authority reserved right to inspection, access to lines, terminate hardware and software memories etc. He referred to definition of telegraph under Section 3(1)(aa) of the Indian Telegraph Act. He submitted that Section 4 of the Act gives the Central Government overall contract of working of the telegraph and Section 7 empowered for framing of rules for conduct of telegraphs. By pointing out all the above, it was submitted that though he apprehended action of termination of contract was by respondent company herein, the Central Government being in a controlling Page 5 of 25 HC-NIC Page 5 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT position, writ may be issued to the first respondent to order the second and third respondents.

4.2 It was further submitted by learned counsel for the petitioners that though the services were being operated under a contract, the same was pursuant to a Scheme for operation of in-dialing EPBAXs by private parties under franchisee, which was a Scheme mooted by the Government of India for popularizing such services. He submitted inviting attention of the Court to the Scheme of 1994 and the conditions prescribed in the subsequently connected Circular, that it was not merely a private contract. Referring to clause 13 dealing with termination of licence, it was submitted that local telecom authority had reserved right to revoke the licence at any time. According to him, clause 13.1 was about termination for default, clause 13.2 dealing with termination for insolvency and other provisions and conditions of the Scheme were suggestive of control of the telecom authority of Union of India and therefore the real player in the field was Union of India, submitted learned senior counsel. He therefore submitted that the aspect that there was a contract between the private company and the petitioners for providing the services in question or that it was a contractual dispute, cannot be a hampering factor for holding the petition maintainable.

4.3 Learned senior counsel submitted that the case was fit where writ of mandamus deserves to be issued in respect of the arbitrary action. It was Page 6 of 25 HC-NIC Page 6 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT submitted that a writ would lie even against private entity when such private party discharge a public function. The argument was sought to be furthered by submitting that the services of DID and EPBAX, etc., under the contract are used by various organizations, insurance companies, hospitals, schools and that large number of people take the benefit. It was submitted that services provided could be said to be essential services in day-to-day life, more particularly for the recipients of the services. By putting forth this submission, what was sought to be suggested by learned counsel that the services provided by the petitioners were a public function discharged. This aspect was harped by pressing into service the following decisions-(i) Binny Limited Vs V. Sadasivan [(2005) 6 SCC 657], (ii) Zonal Manager, Central Bank of India Vs Devi Ispat Limited [(2010) 11 SCC 186] and (iii) K.K. Saksena Vs International Commission on Irrigation and Drainage [(2014) 14 SCALE 384].

4.4 Learned senior counsel Mr.S.N. Soparkar for learned advocate Mr.Amar Bhatt assisted by learned advocate Mr.Kunal Vaishnav appearing for the respondents rested their defence on the preliminary points as to the maintainability. It was submitted that second and third respondents are not 'state', nor are agencies of the 'state' so as to fall within the ambit of Article 12 to be amenable to the writ jurisdiction. A reliance was placed on the decision of the Supreme Court in Federal Bank Limited Vs Sagar Thomas [(2003) 10 SCC 737] in which it was held that the Scheduled Bank was not amenable to writ Page 7 of 25 HC-NIC Page 7 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT jurisdiction. It was further contended that providence of telecom services in respect of which the dispute is raised is in contractual arena between the private respondent company-respondent Nos.2 and 3 and the petitioners in respect of which no writ would lie against the first respondent.

4.5 Learned advocate Mr.Niral Mehta for the Union of India submitted that the agreement for providing services as above was a private independent contract and that the Union of India was not concerned except that the services by private parties were permitted in light of the policy announcement of the Government of India in which the private persons were allowed to operate in the field of telecommunication. He relied on condition No.15 in the policy circular dealing with conditions of licence that Local Telecom Authority would not entertain any alleged excess metering complaint from the licencee; condition No.16 stated that any dispute between the extension user and the licencee will be settled between themselves and Telecom Authority will have no responsibility whatsoever in such dispute, to which also learned advocate for Union of India invited attention and placed reliance thereon.

5. In order to appreciate the controversy and the preliminary contentions, adverting to the contract entered into by the petitioners-Operators and on the other hand, Reliance Infocom Limited, a company incorporated under the provisions of the Companies Act, 1956 which is a licnecee. The Agreement inter Page 8 of 25 HC-NIC Page 8 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT alia recite as under.

"Reliance and Affiliate of Reliance have licneses to provide telecommunication Products and Services (more fully described in Annexure A hereto) in various telecommunication circles across India. Reliance is, inter alia desirous of providing such Services through EPABX and for the said purpose is appointing the Operator, who has expressed his desire to provide the EPABX Service at the Territory more clearly mentioned in the Annexure B to this Agreement. The Operator has represented to Reliance that it possesses requisite infrastructure, manpower and adequate financial resources to be appointed as an Operator of Reliance for the purposes as set out in this Agreement and has complied with all statutory requirements for providing Services. Based on the above representation, Reliance desires to appoint the Operator for the specified purposes upon the terms and conditions set forth in this Agreement."

5.1 Entered into for period of two years, the said is a bi-parte Agreement between the two private parties which appends to it three annexures A,B, and C titled as 'Terms and Conditions', EPBAX Premises' and 'Marks' respectively. Briefly may be noticed some of the terms and conditions of the Agreement to comprehend its nature and character. Condition No.2 is regarding provision of services and inter alia prescribes as to in what manner the Operator should operate; further states that Reliance will only be responsible for providing of services to the Operator and not to the End User. Operators are obliged to abide by the specifications of services and the conditions of the Agreement. Condition No.3 mentions about the rights and responsibilities of the Reliance- the giver of the contract which include the quality aspect and the requirement to maintain commercially acceptable levels of services, etc., right for the Reliance to transfer, assign, inspect the EPBAX Page 9 of 25 HC-NIC Page 9 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT premises, etc. is reserved. Condition No.3.4 says that Reliance is entitled to modify, amend or to withdraw the services at any time in its sole discretion. The terms include the warranties to be performed by the Operator, Operators' obligation and duties. Condition No.10 is about suspension and disconnection giving right to the Reliance to terminate the Agreement; Condition No.11 is about termination. Condition No.15.2 inter alia states that the Agreement is on a principal-to-principal basis. The Operator is treated as an independent contractor and is not an agent, partner or employee of Reliance.

5.2 The terms and conditions of the contract define rights and obligations of the said two parties to the contract. These conditions inter-se are to be settled by the parties to the contract themselves. Thus, it is an independent contractual arrangement in which the Central Government or its Department of telecommunications has no role to play. The working of the petitioners in providing services is supervised, monitored and controlled by the Reliance Company. The first respondent-Union of India has no privity in it. A private person to whom the licence is granted, operate in the field by appointing sub-persons as the petitioners are. The rights and liabilities of the licensee and the Operator are independent in law in terms of both their nature and enforceability in law. 5.3 When the controversy is clearly in the contractual realm between second and third respondents-the private company as well as the petitioners, writ jurisdiction is not invokable. In Page 10 of 25 HC-NIC Page 10 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT this context writ would not lie against the private respondents. In the facts of the case and having regard to the nature of the arrangement as above, the first respondent-Union of India is also not amenable to the issuance of writ in the matter. In Binny Limited (supra), a decision relied on on behalf of the petitioners, it was held that even in respect of exercise of contractual power by the public bodies, writ of mandamus does not lie to enforce the contractual duties. In respect of controversy and dispute falling under controversial sphere, even in respect of public bodies, principles of juridical review have limited application and there must be a public law element in the contract so as to attract the concept of issuance of writ of mandamus. While issuance of writ so as to enforce the contractual obligation would not lie even for the contracts which are by the agencies and instrumentalities of the State, in the present case, the principle operate steadfast when the contract in respect of which controversy is urged is purely in private law realm between the private parties.

5.4 It was a forceful submission on part of the respondents herein right from the stage of preliminary objection that the issue involved in the present petition was covered by a decision of Division Bench of the Bombay High Court in M/s.Samvad Telecom Vs Union of India being Writ Petition No.786 of 2016 decided on 21st March, 2016, in which the very contract subject-matter in this case was under consideration. The petitioners before the Bombay High Court Page 11 of 25 HC-NIC Page 11 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT complained about the disruption and disconnection of telecommunication services provided by the very private company contended on the basis of decision of Board of Control for Cricket in India Vs Cricket Association of Bihar [(2015) 3 SC 215], that writ would lie. The Bombay High Court negatived the contention flatly, and held that the contract was in private domain and could not be subjected to judicial review.

5.4.1 The following was held by the Bombay High Court, "... It is a dispute arising out of the terms and conditions of the contract executed and entered into by the Petitioners and Respondent No.2. It may be that the Respondent No.2 provides telecommunication services under the licence from the State/Union of India. However, when it is rendering such services and is permitted to enter into franchisee agreements and the franchisee to provide service to end users/ customers, all such dealings or acts cannot be said to be a subject matter of judicial review and by a Constitutional Court. These are issues arising between the Petitioners and Respondent no.2 who are private entities. They are essentially arising from the franchisee agreements or terms and conditions of the contract in that behalf....." (Para 4) 5.4.2 It was further stated, ".... The Hon'ble Supreme Court in Board of Control for Cricket in India (supra) does not lay down any principle and different from its earlier decision that every contractual dispute cannot be a subject matter of judicial review in a Writ Petition under Article 226 of the Constitution of India. In such circumstances, the power of judicial review by entertaining a Writ Petition under Article 226 of the Constitution of India, cannot be exercised in the facts peculiar to the present case. The dispute being purely contractual. It is open to the Petitioners to take recourse to such remedy as may be available in general law......"

(Para 5) 5.5 It may be true that the contract in question Page 12 of 25 HC-NIC Page 12 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT owes its creation in light of the policy of the Government of India, Ministry of Telecommunication, which evolved a Scheme whereby In-Dialing and EPABX telecommunicative systems were allowed to be operated by private players. The franchisee is allowed to provide the services to end-users by appointing sub- agencies and entering into agreements with such sub- persons. It was the contention of the petitioners that as the contract drew its genesis from the policy of the Government of India, the GoI while appointing the private company as franchisee-cum-licencee prescribed certain regulatory conditions to be observed by the said licencee and hence retained control, further extending the submission that therefore the writ of mandamus may be appropriately issued. In this regard, decision of the Federal Bank (supra) may be referred to.

5.5.1 The Supreme Court in that case, while holding that the appellant-Federal Bank Limited was a private body against whom writ petition was not maintainable, noted that merely because Reserve Bank of India lays banking policy in the interest of banking system or in the interest of monetary stability or sound economic growth having due regard to the interest of the depositors, etc., as provided under Section 5(c)(a) of the Banking Regulation Act, does not mean that private company carrying on business of commercial activity and banking, discharge any public function or public duty. It was observed that all regulatory measures applicable to those carrying on such activity are such failing which Page 13 of 25 HC-NIC Page 13 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT certain consequences would follow as indicated in the Banking Regulation Act. By same analogy if for the licencee company, Government of India, Department of Telecommunication, has prescribed certain norms in tune with the provisions of the Indian Telegraphic Act, that by itself cannot make the private company- the second and third respondents herein-a public body against whom the petitioners could ask a writ of mandamus. By same stretch of reasoning, the first respondent-Government of India is also not amenable to the writ jurisdiction only on such basis.

5.5.2 In Federal Bank (supra), while answering the question whether the appellant-Bank was a private body or falls within the definition of 'state' under Article 12, it held that a writ petition under Article 226 of the Constitution may be maintainable against

(i) the State (Government); (ii) an authority; (iii) a statutory body; (iv) an instrumentality of agency of the State; (v) a company which is financed and owned by the State; (vi) a private body run substantially on State funding; (vii) a private body discharging a public duty or positive obligation of a public nature; and (viii) a person or a body under a liability to discharge any function under any statute, to compel it to perform such statutory function.

5.6 Therefore governmental Scheme may prescribe certain conditions to be observed by the licencee as a regulatory mechanism for the purpose of granting licences and in that regard, the respondent company as a licensee may be responsible in respect of those regulatory aspects to the Government of India, but Page 14 of 25 HC-NIC Page 14 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT that by itself does not denude off or even dilute the character of pure contractual arrangement reflected in the contract entered into between the licencee company and the Operators-the petitioners and like persons. Mere fact that it was Central Government which framed a policy Scheme for allowing such services to the private domain and Scheme provided for granting licences to the private players, thereby only the Government cannot be said to be exercising any control as such over the contractual agreement between the licencee and the Operator. There is no privity in law for the Central Government, nor does it be extends to bring into the arena of contract-based controversy any role of the Central Government or the Telecommunication Department.

6. Pausing at this stage to deal with decisions relied on behalf of the petitioners, in Binny Limited (supra), the principle was underlined that writ of mandamus or remedy under Article 226 is pre-eminently a public law remedy, still however, in certain conditions, the same may be available against private body or person. The conditions for writ of mandamus or invocation of remedy under Article 226 against private body are that, as stated by the Apex Court, firstly if such private body has been discharging public function or a decision sought to be corrected or enforced is in discharge thereof.

6.1 It was highlighted that there must be present a public law element to entitle a person to seek mandamus under Article 226 of the Constitution.

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HC-NIC Page 15 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT "A writ of mandamus or the remedy under Article 226 is pre-eminently a public law remedy and it is available against a body or person performing a public law function and is not generally available as a remedy against private wrongs. It is used for enforcement of various rights of the public or to compel public/statutory authorities to discharge their duties and to act within their bounds. It may be used to do justice when there is wrongful exercise of power or a refusal to perform duties. This writ is admirably equipped to serve as a judicial private body or person, specially in view of the words used in Article 226 of the Constitution. However, such private authority must be discharging a public function and the decision sought to be corrected or enforced must be in discharge of a public function. The scope of mandamus is determined by the nature of the duty to be enforced, rather than the identity of the authority against whom it is sought. If the private body is discharging a public function and the denial of any rights is in connection with the public duty imposed on such body, the public law remedy can be enforced. The duty cast on the public body may be either statutory or otherwise and the source of such power is immaterial, but, nevertheless, there must be the public law element in such action. ... ... "

(Paras 9 to 11 & 29) 6.2 In K.K. Saksena (supra) the issue addressed by the Apex Court was whether International Commission on Irrigation and Drainage (ICIC) was a 'state' under Article 12 of the Constitution and whether a writ petition against it would lie under Article 226 of the Constitution. Holding that ICID was neither a 'state' nor was discharging public function, so as to bring it within the ambit of public duty and making it amenable to the writ jurisdiction of the High Court.

7. The private law is that part of a legal system which is a part of Common Law that involves relationship between individuals such as law of contract or torts. Therefore, even if writ petition would be maintainable against an authority, which is Page 16 of 25 HC-NIC Page 16 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT 'State' under Article 12 of the Constitution, before issuing any writ, particularly writ of mandamus, the Court has to satisfy that action of such an authority, which is challenged, is in the domain of public law as distinguished from private law, and the function discharge is in the nature of State function so identified in actuality with having an essential element of public dimension.

7.1 An another aspect which is endorsed to is that even if a body performing public duty is amenable to writ jurisdiction, all its decisions cannot be made subject to a judicial review. Only those decisions which have public element may attract scanning under judicial review in the writ jurisdiction of the Constitutional Court. It is also a well established principle that contract of personal service cannot be enforced under writ jurisdiction.

8. Submission of learned advocate for the private respondents could not be brushed aside lightly when admittedly the contract between the private respondents and the petitioner-operators contained in its Clause 14 an arbitration clause. In view of existence of arbitration clause, the same has to be resorted to, on that count also the writ becoming not maintainable.

9. The submission of the petitioners that providing telecommunication services by respondents through them is a discharge of public function can be said to be already answered by the principles emanating from the decision of the Supreme Court in Page 17 of 25 HC-NIC Page 17 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT Jatya Pal Singh Vs Union of India [(2013) 6 SCC 452], which considered the question whether reconstituted entity of erstwhile public sector undertaking-Videsh Sanchar Nigam Limited (VSNL) after its disinvestment by Government of India was a 'state' or other authority under Article 12 of the Constitution, it was held that the reconstituted private entity was not an authority within Article 12 and was not amenable to writ jurisdiction. With the Government of India disinvesting the major share holding of VSNL to a private entity that is Tata Group of Company (TCL) and the said TCL performed the function of providing International Long Distance Telecom Services (ILDS) after disinvestment. Previously the said functions were performed by Oversees Communication Service (OCS) which was a sub-department of Government of India and subsequent by VSNL-a PSU till disinvestment. The Supreme Court held that after disinvestment in 2002, merely because TCL is performing functions which were initially performed by OCS, is not sufficient to hold that TCL is performing a public function.

9.1 In Jatya Pal Singh (supra) it was canvassed that right to communication is a facet of freedom of speech and expression under Article 19(a)(a) of the Constitution, that the VSNL/TCL were having a monopolistic status over the international communication; that the function was in the nature of sovereign function and it was also an argument advanced that when Government in exercise of its executive power by way of policy decision, creates an entity or divest its function which may have bearing Page 18 of 25 HC-NIC Page 18 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT upon a fundamental right, in favour of a private body or transfer of public entity to a private body, in such an eventuality the functions earlier discharged by the Government cannot be termed as a private function. The Supreme Court negatived all these contentions. It was concluded that looking to the size of shareholding it was abanduntly clear that the Government of India did not have sufficient interest in the control of either management or policy making functions. It was held that merely because Tata Communication Limited was performing the functions which were initially performed by OCS would not be sufficient to hold that it is performing a public function. It was held that the functions performed by VSNL/TCL cannot be called public functions and these operators provide a service to the subscribers which is available upon payment of commercial charges.

9.2 The Supreme Court in Binny Limited (supra) quoted with approval from the Judicial Review of Administrative Action (5th Edn.) by de Smith, Woolf & Jowell in Chapter 3, para 0.24, it is sated thus:

"A body is performing a 'public function' when it seeks to achieve some collective benefit for the public or a section of the public and is accepted by the public or that section of the public as having authority to do so. Bodies therefore exercise public functions when they intervene or participate in social or economic affairs in the public interest. This may happen in a wide variety of ways. For instance, a body is performing a public function when it provides 'public goods' or other collective services, such as health care, education and personal social services, from funds raised by taxation. A body may perform public functions in the form of adjudicatory services (such as those of the criminal and civil courts and tribunal system). They also do so if they regulate commercial and professional Page 19 of 25 HC-NIC Page 19 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT activities to ensure compliance with proper standards. For all these purposes, a range of legal and administrative techniques may be deployed, including rule making, adjudication (and other forms of dispute resolution); inspection; and licensing."

(Para 11) 9.3 The Supreme Court in Jatya Pal Singh (supra) referred to the observations from Judicial Review of Administrative Action (5th Edn.) by de Smith, Woolf & Jowell which were quoted in Binny Limited (supra) and held, "These observations make it abundantly clear that in order for it to be held that the body is performing a public function, the appellant would have to prove that the body seeks to achieve some collective benefit for the public or a section of public and accepted by the public as having authority to do so." (Para 52) (emphasis supplied) "in the present case, as noticed earlier, all telecom operators are providing commercial service for commercial considerations. Such an activity in substance is no different from the activities of a bookshop selling books. It would be no different from any other amenity which facilitates the dissemination of information or data through any medium. We are unable to appreciate the submission of the learned counsel for the appellants that the activities of TCL are in aid of enforcing the fundamental rights under Article 19(1)(a) of the Constitution. The recipients of the service of the telecom service voluntarily enter into a commercial agreement for receipt and transmission of information." (Para 53) (emphasis supplied) 9.4 It was harped that the respondents in providing the telecommunication services in question, were discharging public function and that end-users were institutions, hospitals, etc. It was submitted that telecommunication services were necessary to the society, therefore also, it was a public function discharged and the contract had a public nature element. Apart that no details are available as to who are the end-users of the services in question, the Page 20 of 25 HC-NIC Page 20 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT identity or status of the end-users by itself would not bring the contract into the public domain. Further, merely because the beneficiaries under the private arrangement are large number of persons, it would not convert the subject matter of function into a public function automatically. The contract between private respondent company and the petitioner- operators for providing DID and EPBAX service cannot be viewed as in performance of a public function by either of them. It can certainly be said that function does not become public function simply because it is extended to number of persons; in order that it is a public function in its true sense, it has the element of core state obligation.

9.5 Merely because a body gives some benefits to a collective body of persons, it cannot be said to be discharging a public function. Public function has its own connotation and is ingrained with public law element. It is the public law element which is sine qua non for correct construction of connotation 'public function'. Therefore, function classified as 'public function' include areas such as education, public health, and a social services which the State is constitutionally obliged to impart to the citizens, the adjudicatory function such as civil courts and the system of tribunal as well as those other activities and functions which is in the nature of sovereign functions.

9.6 A particular function treated as public function is backed by its rationale and reason to Page 21 of 25 HC-NIC Page 21 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT treat it in a real public domain as a state's obligation. Private educational service is viewed in the nature of sovereign function and right to information is a fundamental right for children upto age of 14 as per Article 21A. Similarly the adjudicatory function by the courts is also a sovereign function. Function of health care is a responsibility of a welfare State and cannot be divorced from being a core state function. Public function is a function which stands from obligation of a State viewed as non-commercial in terms of State's duty. The bodies can be said to be exercising public function when they intervene or participate in social or economic affairs in public interest. When a role of 'state' is assumed for performing a state function by private body thereby stripping off its private character, such would be a public function discharge by a body who would be then amenable to the jurisdiction under Article 226.

10. Reverting back to the facts of the present case, respondent company which is a private licencee provides telecommunication services in the nature of DID and EPABXs through the private operators-the petitioners in whose favour a bi-parte agreement have been entered into for the purpose. Merely because the licencee provides this function in the background of a policy of the Government of India permitting providence of telecommunication services by private players and private body, that by itself cannot make the function a public function or a private body performing the same a public body to whom a writ of Page 22 of 25 HC-NIC Page 22 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT mandamus could be issued. As it is held in Jatya Pal Singh (supra), the function performed by VSNL/TCL cannot be put on same pedestal as the function performed by private institution in imparting education to children, by same analogy the function performed by the second and the third respondents-the private company is not of same nature and character which may make it public function. It is purely a commercial service provided upon payment of charges to private operators and does not have any trapping of public law element. The controversy remains strange to the attraction of the writ jurisdiction.

10.1 The action is based on an apprehension. At the same time, no ground is disclosed for the proposed action of discontinuation of services to the petitioner-operators. Learned senior counsel for second and third respondents pleaded ignorance stating that he was not aware about the precise ground or reason on the basis of which the action is intended. It was submitted in this regard by other side that non-disclosure of ground itself render the proposed action arbitrary and high-handed treatment. However the argument of arbitrariness cannot hold good in this jurisdiction when the writ is not maintainable against the private respondents for the aforesaid reasons. The controversy and its nature as it unfolds as to assuming on a larger canvass before the appropriate forum under common law or by raising a civil dispute where the apprehended action can be examined threadbare with reference to the contractual obligations and their alleged breach. In any case, Page 23 of 25 HC-NIC Page 23 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT this Court has no occasion in this proceeding, and has not gone into any such aspect of merit of the matter. The merits can be agitated by the petitioners in an appropriately instituted proceeding in common law or by way of civil suit, as may be advised.

11. For all the aforesaid reasons and discussion, writ jurisdiction could not be exercised. No writ would lie against the first respondent in the facts and circumstances of the case and having regard to the kind and nature of the subject matter and the controversy. Therefore the prayer against the first respondent-Union of India is not liable to be granted. The respondent Nos.2 and 3 are not amenable to writ jurisdiction of this Court, both in view of they being private entity as well as the nature of dispute not being in the realm of public function.

12. At the same time petitioners are not precluded, because of the present order, from availing their remedy in civil law. If the petitioners opt and if are advised, they may avail such remedy in accordance with law. Only in order that the petitioner are not deprive of their right to avail remedy before the appropriate forum by another stroke of pen, interim relief which was granted by this Court on 10th March, 2016 while issuing notice, shall continue to operate till 15th June, 2016.

13. It is, however, clarified that neither the aspect of the recourse of the other remedy kept open for the petitioners, nor the factum of continuation of operation of interim relief allowed for the aforesaid Page 24 of 25 HC-NIC Page 24 of 25 Created On Fri Jun 10 21:56:29 IST 2016 C/SCA/3905/2016 CAV JUDGMENT limited purpose, shall be construed as amounting to any expression on merits or any reflection on the merits of the case of the petitioners. The proceedings of the remedy which may be availed shall not in any way be influenced by the aforesaid aspect. Furthermore, it is equally clarified that this Court has not gone into the merits of the case of the either side. The petition is dismissed as above.

14. The petition fails and is hereby dismissed, subject to above limited qualification.

Notice stands discharged.

(N.V.ANJARIA, J.) Anup Page 25 of 25 HC-NIC Page 25 of 25 Created On Fri Jun 10 21:56:29 IST 2016

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