M. P. SINGH & Ors. v. VIDESH SANCHAR NIGAM LTD. & Ors.

Ms. Shikha Sarin, Advocates for VSNL Mr. Ravinder Agarwal, CGSC with Mr. Nitish Gupta, Advocates for UOI. W.P. (C) 23563-68/2005 M.P.SINGH & ORS. ..... Petitioners Through: Dr. K.S. Chauhan with Mr. Tej Singh Varun, Mr. Ajit Kumar Ekka, Mr. Chand Kiran and Mr. Gyan Mitra, Advocates. versus UNION OF INDIA & ORS. ..... Respondents Through: Mr. Chetan Sharma, Senior Advocate with Mr. Rishi Agarwala and Ms. Shikha Sarin, Advocates for VSNL. Ms. Reema Khurana, Advocate for R-3 and R-4. Mr. Ravinder Agarwal, CGSC with Mr. Nitish Gupta, Advocates for UOI. W.P. (C) 5810/2007 & CM 10822/2007 RAM PRAKASH ..... Petitioner Through: None. versus UNION OF INDIA & ORS ..... Respondents Through: Mr. Chetan Sharma, Senior Advocate with Mr. Rishi Agarwala and Ms. Shikha Sarin, Advocates for VSNL. Mr. Ravinder Agarwal, CGSC with Mr. Nitish Gupta, Advocates for UOI. W.P. (C) 6610/2007 JILE JEET RAM & ORS. ..... Petitioners Through: None. versus UNION OF INDIA & ORS. ..... Respondents Through: Mr. Chetan Sharma, Senior Advocate with Mr. Rishi Agarwala and Ms. Shikha Sarin, Advocates for VSNL. Mr. Ravinder Agarwal, CGSC with Mr. Nitish Gupta, Advocates for UOI. W.P. (C) No. 3335 of 2005 and batch W.P. (C) 7563/2007 & CM 14402/2007 MUKH RAM SHARMA ..... Petitioner Through: None versus VIDESH SANCHAR NIGAM LTD. & ANR ..... Respondents Through: Mr. Chetan Sharma, Senior Advocate with Mr. Rishi Agarwala and Ms. Shikha Sarin, Advocates for VSNL. Mr. Ravinder Agarwal, CGSC with Mr. Nitish Gupta, Advocates for UOI. W.P. (C) 7565/2007 & CM 14405/2007 VIJAY THAKUR ..... Petitioner Through: Mr. T.N. Razdan with Ms. Smriti Razdan, Advocates. versus VIDESH SANCHAR NIGAM LTD. & ANR ..... Respondents Through: Mr. Chetan Sharma, Senior Advocate with Mr. Rishi Agarwala and Ms. Shikha Sarin, Advocates for VSNL. Mr. Ravinder Agarwal, CGSC with Mr. Nitish Gupta, Advocates for UOI. W.P. (C) 149/2008 & CM 300/2008 N.B. BHATT ..... Petitioner Through: Mr. T.N. Razdan with Ms. Smriti Razdan, Advocates. versus VIDESH SANCHAR NIGAM LTD. ..... Respondent Through: Mr. Chetan Sharma, Senior Advocate with Mr. Rishi Agarwala and Ms. Shikha Sarin, Advocates for VSNL. Mr. Ravinder Agarwal, CGSC with Mr. Nitish Gupta, Advocates for UOI. W.P. (C) 12041/2009 & CM 12278/2009 RAMJEET SINGH ..... Petitioner Through: Dr. K.S. Chauhan with Mr. Tej Singh Varun, Mr. Ajit Kumar Ekka, Mr. Chand W.P. (C) No. 3335 of 2005 and batch Kiran and Mr. Gyan Mitra, Advocates. versus UNION OF INDIA & ORS. ..... Respondents Through: Mr. Chetan Sharma, Senior Advocate with Mr. Rishi Agarwala and Ms. Shikha Sarin, Advocates for VSNL. Mr. Ravinder Agarwal, CGSC with Mr. Nitish Gupta, Advocates for UOI.

1. Whether Reporters of local papers may be allowed to see the judgment? No

2. To be referred to the Reporter or not? Yes

3. Whether the judgment should be reported in Digest? Yes CORAM: JUSTICE S. MURALIDHAR JUDGMENT

29.08.2011

1. These writ petitions by former employees of the Videsh Sanchar Nigam Ltd. („VSNL‟), which is Respondent No. 1 in some of the writ petitions, raise an interesting question of law as to the maintainability of the very petitions. The plea of VSNL, which is now renamed as „Tata Communications Ltd.‟ („TCL‟), is that after disinvestment the shareholding of the central government in VSNL came down to 26.12%, and since it no longer performs a public function or discharges a public duty a writ petition under Article 226 of the Constitution is not maintainable against it.

2. This Court has heard the submissions of Mr. T.N. Razdan and Dr. K.S. Chauhan, learned counsel for the Petitioners, Mr. Chetan Sharma, learned Senior counsel for the TCL and Mr. Ravinder Agarwal, learned counsel appearing on behalf of the Union of India.

3. Each of the Petitioners, appointed in VSNL prior to disinvestment, was sought to be terminated more than two years after the disinvestment had taken place. As a representative sample, the facts in W. P. (C) 3335 of 2005 (M.P. Singh v. VSNL) may be noticed. There are three Petitioners in this writ petition. Petitioner No. 1 M.P. Singh was initially appointed as a Junior Technical Assistant with effect from June 1980 and worked W.P. (C) No. 3335 of 2005 and batch till 3rd June 1983, and again from July 1983 to January 1990. He was absorbed in regular service as Technical Assistant with effect from 1st January 1990. He was then promoted to the post of a Deputy General Manager („DGM‟) in VSNL on 27th December 2001. He is aggrieved by the letter dated 28th September 2004 issued by the VSNL rating his performance as „unsatisfactory‟ for the period from 2002-03 and 2003-04. Petitioner No. 2 was also appointed as a Junior Technical Assistant with effect from 2nd September 1974. He was promoted as Senior Manager (Engineering) with effect from 23rd January 2002. He too is aggrieved by a letter dated 28th September 2004 in which his performance for the period 2002-03 and 2003-04 has been rated as „unsatisfactory‟. Petitioner No. 3 was appointed in January 1981 as a Junior Technical Assistant and promoted to the post of Senior Manager in February 2002. He is aggrieved by a letter dated 28th September 2004 rating his performance for 2002-03 and 2003-04 as „unsatisfactory‟.

4. The central government took a policy decision to offload its shares in VSNL by way of disinvestment. With effect from 13th February 2002 VSNL ceased to be a public sector undertaking. A shareholders‟ agreement of that date was entered into between the President of India and Panatone Finvest Ltd. („PFL‟), Tata Sons Ltd. („TSNL‟), Tata Power Company Ltd. („TPCL‟), Tata Industries Ltd. („TIL‟) and Tata Iron and Steel Company Ltd. („TISCO‟) whereby the shareholding of the central government in VSNL was reduced to 26.12%. The share of PFL was 25%, of foreign companies (shares held by the Bank of New York as being depository for ADRs), 21%, of the several foreign financial institutions 10.86%, of the Indian public financial institutions and mutual funds

7.9%, the general public 4.92%, Indian body corporates 3.09%, the shares allotted against employees stock option 1.85% and the balance small quantities of less than 1% were of non-resident Indians and Indian national banks.

5. The Petitioners contend that at the time of their appointments they were in the Overseas Communications Service („OCS‟), a department of the Government of India („GoI‟) and thereafter absorbed in the VSNL in terms of the Office Memorandum („OM‟) dated 11th December 1989. According to them, para 4 of the said OM which deals with dismissal/removal from service implies that the same terms and conditions as were applicable to central government servants would apply to the Petitioners as well. A reference is made to an understanding between VSNL and the GoI as expressed in the W.P. (C) No. 3335 of 2005 and batch letter dated 16th March 2001 during negotiations for disinvestment to the effect that the service conditions of the employees must be formulated in consultation with the employees‟ unions and all service conditions including Conduct, Discipline and Appeal Rules, 1992 should be continued. Reference is also made to a clause in the shareholders‟ agreement which requires the strategic partner to use its best efforts “to cause the Company to continue to provide adequate job opportunities” for the benefit of the members of SC/ST, physically handicapped persons and other socially disadvantaged categories of the society. It is contended that inasmuch as the GoI continues to hold

26.92% of the share capital, VSNL continues to perform a public function.

6. Relying on the observations of the judgment of the Supreme Court in Zee Telefilms v. Union of India (2005) 4 SCC 649, it is contended that even if VSNL is no longer State under Article 12 of the Constitution, a writ petition under Article 226 would nevertheless be maintainable against it. Reliance is placed on the decisions in Binny Ltd. v. Sadasivan (2005) 6 SCC 657; State of Assam v. Barak Upatyaka D.U. Karamchari Sanstha (2009) 5 SCC 694; L.M.L. Ltd. v. State of UP (2008) 3 SCC 128; BSNL v. BPL Mobile Cellular Ltd. (2008) 13 SCC 597; Anadi Mukta Sadguru S. M. V. S. J. M. S. Trust v. V. R.