Not An Authority Under Article 12 Of Constitution: Supreme Court Directs CRRID To Pay Withheld Salaries Of Employees From Its Own Resources
The Supreme Court allowed Civil Appeals challenging the Order of the Punjab and Haryana High Court’s Division Bench.
The Supreme Court has directed Centre for Research in Rural and Industrial Development (CRRID) to pay salaries to all its employees which were withheld between April 2021 to March 2023, from its own resources.
The Court was deciding a batch of Civil Appeals challenging the Order of the Punjab and Haryana High Court’s Division Bench. The Appeal filed by the Indian Council of Social Science Research (ICSSR) was taken up as the lead case.
The two-Judge Bench comprising Justice Sudhanshu Dhulia and Justice K. Vinod Chandran held, “CRRID, in any case, is not an authority within the purview of Article 12 of the Constitution of India. Merely because CRRID is under the control of an authority (as defined under Article 12) will not make CRRID an authority. In fact, this is neither the case of the respondents employees nor does CRRID in any manner assert itself as an Authority.”
The Bench observed that the presence of one or even two members of ICSSR in a Governing Body of twelve does not amount to “deep and pervasive” control of the State.
Additional Solicitor General (ASG) K.M. Nataraj and Advocate Ranbir Singh Thakur appeared for the Appellants while Senior Advocates Narender Hooda, Sanjeev Sharma, and Advocate Ana Upadhyay appeared for the Respondents.
Brief Facts
The Appellant i.e., ICSSR is a society established in 1969 and registered under the Societies Registration Act, 1860 but under the total financial and administrative control of Ministry of Education, Government of India. The Respondent i.e., CRRID is an autonomous Research Institute in Chandigarh. The working of CRRID is administered, directed, and controlled by its main body. This Governing Body of CRRID can have a maximum of twelve members including seven life members.
In 2015-2016, several complaints were received by ICSSR against CRRID alleging malpractices in the functioning of CRRID including violation of rules and regulations and misuse of resources including the grants paid by ICSSR. Pursuantly, ICSSR constituted a committee to enquire into allegations against CRRID. In its 2017 report, the Committee highlighted various irregularities and malpractices within CRRID. It was found to be in violation of Rules as allegedly there were appointments of unqualified persons with either fake or dubious degrees. In sum and substance, ICSSR was not satisfied with the actions taken by CRRID and since CRRID did not submit its clarification as sought by ICSSR regarding deficiencies in the action-taken report, ICSSR finally stopped releasing its grant in favour of CRRID from April 2021 onwards.
Once the grant was stopped by ICSSR, the Punjab Government followed Suit and stopped 45% of its share of grant to CRRID. In 2022, 17 CRRID employees filed a Writ Petition before the High Court for the release of their salaries. During its pendency, the High-Level Committee recommended the release of future grants so that payment of salaries be made to the employees including Ph.D. supervisors, librarians etc. Consequently, April 2023 onwards, grants were released. Meanwhile, the Single Judge allowed the said Writ Petition, holding that ICSSR has the ultimate responsibility of releasing the grant for the salaries. Thereafter, ICSSR filed a Writ Appeal which was dismissed by the Division Bench. Hence, it was before the Apex Court.
Reasoning
The Supreme Court in view of the above facts, noted, “Even assuming an additional two nominees from the Government of Punjab in the Governing Body will at best make four such members in a Governing Body of twelve. We have been informed that as of today there are only three nominees together from ICSSR and State of Punjab in all. This is not ‘deep and pervasive’ control.”
The Court added that ICSSR is indeed an “authority”, within the purview of Article 12 of the Constitution which also controls CRRID to an extent inasmuch as CRRID depends on the funds released by ICSSR as grants, but this itself cannot be called a “deep and pervasive” control.
“A ‘deep and pervasive’ control would require much more than just financing an institution or a body. Even guiding, controlling or regulating affairs of an institution will not be called a ‘deep and pervasive’ control. The ‘deep and pervasive’ control requires administrative, financial and functional control of such a body to a much higher degree including interference into its day-to-day working, and mere regulatory control cannot mean ‘deep and pervasive’ control”, it further elucidated.
The Court said that the crucial question is not whether the control exercised by ICSSR on CRRID is “deep and pervasive” but whether ICSSR was justified in withholding its grant.
“The financial control by both ICSSR and the State of Punjab is limited only to their grant inaid. ICSSR does not have any power to interfere with the daytoday functions of CRRID. Under these circumstances, it cannot be said that CRRID is under a ‘deep and pervasive’ control of the State. At the same time, it cannot be denied that there is some control of the State in the form of the State of Punjab and ICSSR which is an instrumentality of State. But this control is not of such nature as to make it ‘deep and pervasive’ as has been held by the High Court”, it also observed.
Moreover, the Court remarked that what ICSSR has in its control, definitely, is that it can stop the grant in case of violation of the conditions under which the grant is being given and this is exactly what has happened in this case.
“… this Court cannot lose sight of the fact that it is ultimately the responsibility of CRRID to pay salaries to its employees. This liability cannot be shifted to ICSSR. … the responsibility to pay the salary to its employees, lies on CRRID and not on ICSSR or Government of Punjab”, it concluded.
Accordingly, the Apex Court allowed the Appeals, set aside the impugned Order, and directed CRRID to ensure payment of salaries from its resources within three weeks.
Cause Title- Indian Council of Social Science Research (ICSSR) v. Neetu Gaur & Ors. (Neutral Citation: 2025 INSC 374)
Appearance:
Appellants: ASG K.M. Nataraj, AORs Shashank Shekhar Singh, Karan Sharma, Advocates Ranbir Singh Thakur, Amitesh Kumar, Priti Kumari, Mrinal Kishore, Abhinav Singh, Mohit Siwach, Abhishek Bhudiraja, and Ishika Jain.
Respondents: Senior Advocates Narender Hooda, Sanjeev Sharma, AORs Surender Singh Hooda, Sylona Mohapatra, Nirnimesh Dube, Advocates Ana Upadhyay, Shiv Bhatnagar, Yuvraj Nandal, Pallvi Hooda, Tannu, Seema Sindhu, Vikram Singh Rawat, Ashutosh Kumar, Navin Kumar, Sandeep Singh, and T. Illayarasu.
