R.M. Sahai, J. - (1.) Legal issue that arises for decision in this petition filed by a permanent processing Superintendent, of a subsidiary company of British India Corporation, acquired by Central Government against termination of his services without any inquiry or proceeding either under disciplinary and conduct rules of the company or in compliance with principle of natural justice is if the expanding horizon of Article 226 extends to granting of redress against violation of basic norms of service jurisprudence even by a body which may not be wholly governmental. Associated-'with this is the issue if subsidiary company of a Government Company is subject to same restrictions as are legally applicable to a Government Company and whether such a company is State or not within meaning of Article 12 of the Constitution against whose actions writ petition are maintainable} under Article 226.
(2.) Factual canvass is plain and simple, la April, 1978 the petitioner was appointed as permanent Processing Superintendent after successful completion of one year probation by the Elgin Mills Company, a subsidiary of British India Corporation which was acquired by Central Government in June, 1981. In 1983 the Company enforced disciplinary and conduct rules with effect from February, 1981, but no action was taken under it. And the services of petitioner were terminated not under service and conditions applicable to Staff Management as was stipulated in the orders of appointment but in purported exercise of power governing relations between Master and Servant.
(3.) That the order of termination banishing the petitioner was naked exercise of 'hire and fire' rule thus violative of the "great rules of natural justice", the "audi altcrum" rule as was observed by Hon'ble Supreme Court in Central Inland Water Transport Corporation v. Braj Nath, AIR 1986 SC 1571, and arbitrary exercise of power enabling opposite-party to act discriminately cannot be doubted. Nor it could be disputed that such power flowing from agreement or contract was against public policy as a bargain entered between unequals with "gross inequality of bargaining power with terms unreasonably favourable to the stronger party" may render the agreement unconscionable. But the thrust of submission by Sri Venu Gopal, the learned Senior Advocate of Supreme Court, while candidly stating that since nature of duties of petitioner were supervisory in nature, therefore, he could not seek any redress under Industrial Disputes Act, was that the jurisdiction of this Court to entertain any petition under -Article 226 extended to constitutional or statutory violations and not to contractual breaches. He urged that arbitrariness or fairness at the stage of entering into agreement may be open to challenge under Article 226, but no after the agreement became final and ripened into a contract the infringement or violation of which could result into damages enforceable by a suit and not reinstatement though certiorari. Maintainability of the petition was also challenged because even if 100% shares was held by Government, the Company still would not be "State" within-meaning of Article 12 as take over of sick commercial company to ameliorate the labour results in change of ownership and not in activities which continue to be commercial. Therefore, irrespective of financing or even presence of government officials on the Board of Company it could be "State" only, if the government exercised control and the nature of activity was governmental or akin to it.;