As mentioned in Article 21 of the Indian Constitution that “no person shall be deprived of his life or personal liberty except according to a procedure established by law”. It means that a person can be deprived of the life of the procedure established by law made by the state. So the question arises what is a state where the definition is given Article 12 of the Indian Constitution.
Article 12 of the Indian Constitution states that, “definition in this part, unless the context otherwise requires, the State includes the Government and Parliament of India and the Government and the Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India”. As mentioned in Article 13 states that state shall not make any laws which take away the fundamental rights of the citizens. It means citizens can protect their fundamental rights from the state.
In order to make sure that the state is not exhaustive in nature and can allow other authorities to ask rights from them, Article 12 is inclusive in nature and has the word other authorities. There is a vertical relationship between other authorities with the state.
CHANGING NATURE OF THE DEFINITION OF STATE
In order to assess the limits of Article 12, it will be important to go through the Debates of the Constituent Assembly (CAD) as to what functions the state should perform. In his speech on November 29, 1948, in reaction to Dr. Kamath, Dr. Ambedkar clearly specified that they had to have a broader connotation of the phraseology of government. Many of the Constituent Assembly leaders, however, are doubtful about Dr. Ambedkar's strategy. Mr. Naziruddin Ahmad, who was not persuaded by this approach, was one such founding member. Mr. Ahmad challenged the concept of expanding the scope of government to include taluka and local boards in his speech on 9 November 1948. Only one government could exist for him, one with sovereign power and he mentioned that even if the body performs no function, it would also be regarded as the state.
Mr. Ahmad’s and Dr. Ambedkar's methods reflect two ways of seeing the state; academically referred to as structuralist and functionalist. The structuralist searches for the state structure within an entity or institution to declare it a state, whereas the functionalist looks at the core function; if the role is a state function, it would fall within the definition of Article 12. There is a transition of nature of the state by the Apex Court from structuralism to functionalism.
In initial years it was inclined towards a structural approach. In the case of Rajasthan State Electricity Board v. Mohan Lal, Justice Bhargava argued that, in order to declare a particular body a state, that body must be created by a statute and must have the power to punish. Two criteria can be seen from the above analysis:
1) The statutory body; and
2) The power to punish.
He rejected the principle of ejusdem generis or things of like nature which were evolved in the case of the University of Madras v. Santa Bai. Nevertheless, by the 1980s, when Justice KK Mathew's concurrent opinion in Sukhdev Singh v. Bhagatram brought in a new dimension, this approach slowly diminished. Instead of stressing the criteria set out in RSEB, Justice Mathew focused on the body's functions. His view opened the doors to the functionalist; so rather than looking at the structure, the focus turned to a body's function. Therefore, if a body discharged a high public value function, it could be a state for Justice Mathew.
The Supreme Court held in the case of Som Prakash v. Union of India that a government corporation (Bharat Petroleum Corporation) falls within the meaning of the term the Government used in Article 12. As per Justice V Krishnaiyer, the word other authorities will include all constitutional or legislative bodies that are given powers to promote economic activities. Not only is it confined to statutory corporations, but it can also include a government company, a registered company, or bodies that have some connection with the government. Nevertheless, the breakthrough came with R.D Shetty v. India's Airport Authority which gave us the 5 criteria as advocated by Justice P.N Bhagwati. This is a test to determine if an entity is a state agency or instrumentality, which goes as follows–
The state's financial resources are the primary source of funding, i.e. the government holds the entire share capital;
Clear and omnipresent state command;
Functional character is, in fact, political, meaning that its roles are of public interest or governmental character;
A government department has been moved to a company; and
Enjoys the status of a monopoly given or secured by the state.
In Ajay Hasia v. Khalid Mujib Sehravardi, it has been held that whether a statutory body falling within the purview of the term other authorities is to be considered differently. In this case, Justice Mathew's opinion became the majority opinion. It evolved the concept of the juristic veil which means that the state is working behind the instrument or organization. In the opinion of the minority, the tests set out, in this case, are relevant only for the purpose of determining whether an entity is an instrument or an agency of the State. By 2005, however, the criteria were changed again by the Zee Telefilms v. Union of India