Bihar State Power (Holding) Company Limited converts advertisement for Additional Finance Consultant into advertisement for Legal Consultant!

Bihar State Power (Holding) Company Limited has converted advertisement for Additional Finance Consultant into advertisement for Legal Consultant. It has changed the qualification, experience and age criteria in an exercise of apparent arbitrariness. The advertisement appears to be in violation of Articles 14 and 16 of the Constitution of India.  It seems Bihar Government has not drawn lessons from the judgement of Justice Chakradhari Sharan Singh of the Patna High Court in Kapil Kumar vs. the State of Bihar & Others.

Bihar State Power (Holding) Company Limited (BSPHCL), a government of Bihar undertaking under Department of General Administration invited application for the post of Additional Finance Consultant through Walk-In-Interview by an advertisement dated October 10, 2024 published in The Times of India, Patna (p.19). The interview was scheduled to be held on October 22, 2024 at BSPHCL, Vidyut Bhavan, Jawaharlal Nehru Marg, Patna at 3.30 PM on Tuesday. The application was to be addressed to Ram Anugrah Narayan Singh, GM, HR & Admin, BSPHCL. The required qualification and experience were: "CA/ ICWA/ MBA (Finance) from a recognized Institute/University and Minimum experience of 10 years in the field of Finance & Accounts." The emolument is "Consolidated pay amounting to 1,05,000/- (One lakh five thousand) per month." The contract period is "for 3 (three) years initially which may be extended for 01 (one) year at a time, as per requirement of the company and his/her satisfactory job performance." The work and responsibility included "Work related to give advice on the matters related to finance and accounts of BSPHCL & its subsidiary companies. Other Works as entrusted by CMD & GM (HR & Adm.), BSPHCL from time to time." This advertisement was with reference to "Job Contract Notice No. - 12/2024 (Contract)". It stated that "Age should be between 35 to 45 years" as one October 1, 2024. This newspaper advertisement was published vide PR-010425 (B&C) 2024-2025.

Subsequently, The Times of India, Patna (p.21) published a Corrigendum on October 11, 2024 from BSPHCL with reference to "Job Contract Notice No.-11/2024 (Contract)" signed by Ram Anugrah Narayan Singh. The Corrigendum reads: The post mentioned as Additional Finance Consultant in the newspaper notice published vide PR-010426 (B&C) 2024-2025 against notice no.-11/2024 may be read as Legal Consultant." It was published vide PR-010432 (B&C) 2024-2025. The reference the Corrigendum appears incorrect because newspaper advertisement was published vide PR-010425 (B&C) 2024-2025. 

For the post of Legal Consultant, the required qualification and experience are: "LLB (Bachelor of Law) from a recognized Institute/ University. Minimum experience of 20 years in the field of Law. Experience in government department/institutions/ P.S.U will be preferred." The mode of selection is through Walk-in-Interview.

The emolument is mentioned as "Consolidated pay amounting to 90,000/- ( Ninety thousand) per month." It stated that "Age as on 01.10.2024: Should be between 50 to 60 years." The contract period "for 2 (two) years initially which may be extended for 01 (one) year at a time, as per requirement of the company and his/her satisfactory job performance. This contractual engagement may be terminated immediately without giving any prior notice, if performance of the candidate is not found satisfactory by the company." The work and responsibility includes "Works related to giving advice in the -Legal matters, Legal issues related to Projects (Including IT/OT/RDSS/ Pre-paid metres) of BSPHCL and its subsidiary companies. Cyber Crime/Fraud in payment of bills by consumers. Implementation, Monitoring & Observation of Legal work related to BSPHCL & its subsidiary companies. Other works as entrusted by CMD & GM (HR/Adm) of BSPHCL from time to time." The interview is scheduled to be held on October 24, 2024 at BSPHCL, Vidyut Bhavan, Jawaharlal Nehru Marg, Patna at 3.30 PM on Thursday. The application is to be addressed to Ram Anugrah Narayan Singh, GM, HR & Admin, BSPHCL.

Bihar Govt complying with High Court's directions to rectify "the manifest illegalities" in the selection process of all District Collectorates

Important Notice regarding selection process of office attendant/attendant(Special) was issued on March 31, 2023 in compliance with Patna High Court's order dated December 18, 2019. Important notice regarding selection process of office attendant/attendant(Special) for all district collectorates was issued on April 10, 2023 in compliance of Patna High Court's order dated December 18, 2019. Similar notices were issued on January 15, 2024, January 22, 2024, August 7, 2024, August 30, 2024, September 9, 2024 and October 9, 2024. It is apparent that High Court's order set right a long standing illegal selection process.

The High Court had directed "the respondents, particularly, the Additional Chief Secretary/ Principal Secretary, General Administration Department, Government of Bihar, Commissioner, Magadh Division, Gaya and the District Magistrate, Gaya to ensure that the process of selection through the advertisement in question is completed by adopting a fair procedure." Notably, General Administration Department, is under the Chief Minister of Bihar. The judgement was delivered on December 18, 2019. It was authored by Justice Chakradhari Sharan Singh. Justice Singh is currently the Chief Justice of Orissa High Court. 

The petitioners had approached Patna High Court to allege that the criteria laid down in the advertisement was not followed in preparing the provisional panel list of candidates for appointment against Class-IV posts in Gaya Collectorate under the signature of the Divisional Commissioner, Magadh Division, Gaya and other members of the Selection Committee constituted for the purpose. The petition was against nine respondents, namely, 1) the State of Bihar, 2) Principal Secretary, General Administrative Department, Government of Bihar, 3) Commissioner,  Gaya, 4) Collector, Gaya cum Chairman, Selection Committee Group, Gaya, 5) Additional Collector, Gaya, 6) District Development Commissioner, Gaya, 7) District Welfare Officer, Gaya, 8) Additional Collector Establishment, Gaya and 9) Deputy Collector Establishment, Gaya. 

Justice Chakradhari Sharan Singh of the High Court has recorded in his judgement in Kapil Kumar vs. the State of Bihar & Others that the affidavit filed on behalf of respondents no. 4 to 6 revealed that no process of selection of any nature was adopted. Besides Kapil Kumar, the other petitioners were: Hardeo Prasad, Raj Kishore Prasad, Ramjivan Prasad, Mahendra Prasad, Raju Thakur and Md. Ishteyak. Similar petitions were tagged with it. In Shambhu Prasad vs. the State of Bihar, the other petitioners were: Ajay Kumar, Dhanwanti Kumari and Surendra Kumar Sinha. In Aftab Hussain vs. the State of Bihar, the other petitioners were: Ravindra Kumar, Md. Shamim and  Satish Kumar.

The Court observed that there was nothing in  the submission of the State to suggest that the persons were engaged on daily wage basis after following any fair procedure by giving equal and fair opportunity to others, equally willing to serve as daily wage employees, more in need of employment/ engagement. The Court noted that such engagements, "are more often back door" and "the very process of selection as adopted by the respondents through the advertisement in question to be wholly illegal, arbitrary and patently in breach of Articles 14 and 16 of the Constitution of India." It added, "no process of selection has at all been adopted which can be said to be fair and impartial, through written examination or interview or some other rational criteria for judging inter se merit of the candidates."

The Court has recorded in its judgement that "in response to a query made by this Court as to whether any selection process has been undertaken for filling up the said posts from open market giving unemployed youths an opportunity to participate in last few decades, nothing positive has been shown." The query was made in the context of a system having emerged for filling up Class-IV posts in the collectorates on the basis of panel of daily wage workers under the collectorate in the State of Bihar.   

The Court found that "Here is a case where the advertisement does not disclose the number of vacancies/ posts in question and it has just been issued to prepare a panel for filling up the posts. Such exercise renders the statutory rules framed for appointment against such posts under proviso to Article 309 of the Constitution, meaningless. The Court relied on Supreme Court's decision in Renu and others vs. District and Sessions Judge, Tis Hazari Courts, Delhi and another reported in (2014)14 SCC 50, to stress the need of disclosing the number of posts available for selection and recruitment.

The Court observed: "The respondents are obliged to follow a fair process of selection in accordance with the statutory rules and constitutional mandate. It is noteworthy that though the rules have been framed for selection and appointment against Class-IV (Group-D) posts, no clear and definite process of selection has been laid down, therein. If no transparent, fair and impartial procedure is adopted for judging the inter se merit of the candidates, who have applied in response to the advertisement made, the eligible candidates cannot get a fair chance to compete, which would be violative of the guarantee enshrined under Article 16 of the Constitution", as held in case of UPSC vs. Girish Jayanti Lal Vaghela reported in (2006)2 SCC 482.

It recollected the Supreme Court’s decision in case of M.P. State Coop. Bank Ltd. vs. Nanuram Yadav reported in (2007) 8 SCC 264 wherein the principles to be adopted in the matter of public appointments has been laid down. The principles enunciated in case of M.P. State Coop. Bank Ltd. which have been taken note of with approval by the Supreme Court in case of Renu  are as under: 

“(1) The appointments made without following the appropriate procedure under the rules/ government circulars and without advertisement or inviting applications from the open market would amount to breach of Articles 14 and 16 of the Constitution of India.
(2) Regularisation cannot be a mode of appointment.
(3) An appointment made in violation of the mandatory provisions of the statute and in particular, ignoring the minimum educational qualification and other essential qualification would be wholly illegal. Such illegality cannot be cured by taking recourse to regularisation.
(4) Those who come by back door should go through that door.
(5) No regularisation is permissible in exercise of the statutory power conferred under Article 162 of the Constitution of India if the appointments have been made in contravention of the statutory rules.
(6) The court should not exercise its jurisdiction on misplaced sympathy.
(7) If the mischief played is so widespread and all pervasive, affecting the result, so as to make it difficult to pick out the persons who have been unlawfully benefited or wrongfully deprived of their selection, it will neither be possible nor necessary to issue individual show-cause notice to each selectee. The only way out would be to cancel the whole selection.
(8) When the entire selection is stinking, conceived in fraud and delivered in deceit, individual innocence has no place and the entire selection has to be set aside.”

In Renu case, the Supreme Court had the occasion to consider power of appointment granted to the Chief Justice of a High Court under Article 229(1) of the Constitution and in no uncertain terms has held that even the said power granted to the Chief Justice is subject to Article 16(1) which guarantees equality of opportunity to all citizens in matters relating to employment. The expression ‘opportunity’ has been explained in case of Renu (supra) as ‘a chance of employment’ and held that what is guaranteed under Article 16(1) is this opportunity of employment ‘equally available to all’. The observations made in case of Renu (supra) in paragraph 27 are significant and is a reminder for all authorities exercising their power and jurisdiction to make appointment against a public post. The Court made the following observations:

“27. To say that the Chief Justice can appoint a person without following the procedure provided under Articles 14 and 16 would lead to an indefinite conclusion that the Chief Justice can dismiss him also without holding any inquiry or following the principles of natural justice/ Rules, etc. for as per Section 16 of the General Clauses Act, 1897, power to appoint includes power to remove/ suspend/ dismiss. (Vide Pradyat Kumar Bose v. High Court of Calcutta and Chief Justice of A.P. vs. L.V.A. Dixitulu) But as no employee can be removed without following the procedure prescribed by law or in violation of the terms of his appointment, such a course would not be available to the Chief Justice. Therefore, the natural corollary of this is that the Chief Justice cannot make any appointment in contravention of the statutory rules, which have to be in consonance with the scheme of our Constitution.”

In Ramana Dayaram Shetty vs. International Airport Authority of India and others reported in (1979) 3 SCC 489, the Supreme Court remarked that every action of the executive Government must be informed with reason and should be free from arbitrariness which is the very essence of Rule of Law and bare minimal requirement. The Court noted with approval the observation of Kerala High Court in case of V. Punnan Thomas vs. State of Kerala, reported in AIR 1969 Ker 81: “The Government, is not and should not be as free as an individual in selecting the recipients for its largesse. Whatever its activity, the Government is still the Government and will be subject to restraints, inherent in its position in a democratic society. A democratic Government cannot lay down arbitrary and capricious standards for the choice of persons with whom alone it will deal."

In Kasturi Lal Lakshmi Reddy vs. State of Jammu & Kashmir & Anr. reported in (1980) 4 SCC 1, the Court has held that interaction of Articles 14, 16 and 19 shows that the requirement of reasonableness runs like a golden thread through the entire fabric of fundamental rights and where any Government action, whether it be under the authority of law or in exercise of executive power without making law, fails to satisfy the test of reasonableness in public interest, it would be liable to be struck down as invalid.

In Secy. State of Karnataka vs. Uma Devi(3), the Supreme Court has held that it is an obligation cast on the State under Article 39(a) of the Constitution to ensure that all citizens ‘equally’ have the right to livelihood. 

In I.R. Coelho vs. State of Tamil Nadu (2007) 2 SCC 1, the Court held that fundamental rights occupy a unique place in the lives of civilized society and has been described as “transcendentally” “inalienable” and “primordial”. 

In Olga Tellis vs. Bombay Municipal Corporation reported in (1985) 3 SCC 545, the Court held that the right to livelihood is a fundamental right under Article 21 of Constitution of India. 

Drawing on these decisions of the Supreme Court and the relevant provisions of the Constitution of India, Patna High Court has held that the advertisement to the extent that it allows preference under sub-clause (1)(2)(3)(4)(5) and (6) of Clause 7 of the advertisement which dealt with work experience of the aspirants has been "held to be illegal, violative of Articles 14 and 16 of the Constitution of India and are struck down accordingly." The terms of advertisement contemplated preparation of a panel of daily wage employees only by giving them first, second and third preference and those who did not have the opportunity to work as daily wage employee are to be placed at the bottom of the panel, whose merit will depend on respective dates of their birth. The appointments against Class-IV posts, in terms of the scheme, was to be made on the basis of such panel.

The Court's order reads: "In my opinion, holding of written examination of the candidates who have applied against the said advertisement would be a fair procedure for preparation of merit-list, in the absence of any provision in the Rules. This, in my opinion, would ensure transparency in the process of selection. Since the advertisement was issued more than six years ago, the respondents are directed to conclude the process of selection and appointment against such posts, which were available on the date of issuance of advertisement, within a period of three months from today. The respondents are further directed to ensure that a fair process of selection, strictly in accordance with statutory rules and in conformity with the mandate of Articles 14 and 16 of the Constitution is undertaken on regular basis, after advertising number of post, so that the persons acquiring eligibility after the initiation of one selection process have a chance to seek and participate in subsequent selection processes. This practice of fairness in the process of selection for filling up public posts generates faith in the hearts and minds of the citizen in the governance, laws and the Constitution."

The advertisement No. 01/2013 had referred to the Bihar Group-D (Recruitment and Service Condition) Rules, 2010 framed by the State of Bihar under the proviso to Article 309 of the Constitution of India. The Rules came into effect from the date of its publication in the official gazette on March 29, 2010. 

 

Temporary employees with characteristics of regular government servants cannot be denied pension: Supreme Court

In Rajkaran Singh Vs. Union of India, Supreme Court's bench of Justices Hima Kohli and Sandeep Mehta set aside the judgement of the Delhi High Court's Division Bench of Justices Vipin Sanghi and Deepa Sharma whereby it had dismissed the appellants' writ petition and had upheld the judgement of the Central Administrative Tribunal (CAT), Principal Bench, New Delhi. The Tribunal had rejected the appellants’ claim for benefits of the replacement scales of the Revised Pay Rules, 2008 in accordance with the 6th Pay Commission Report, with effect from January 1, 2006. The High Court's judgement was authored by Justice Sanghi. Prior to that the case was heard by Tribunal's bench of V. Ajay Kumar, the Judicial Member and Dr. B.K. Sinha, the Administrative Member. Its judgement was authored by Dr. Sinha. 

Applying the principles laid down by the Supreme Court in several cases to the case at hand, the Supreme Court found "compelling evidence on record which establishes that the appellants meet the characteristics of regular government servants. Admittedly, the appellants were appointed on a regular pay scale. This factor strongly indicates a formalised employee-employer relationship akin to permanent government employees." Its judgement reads: "The mere classification of employees as 'temporary' or 'permanent' is not merely a matter of nomenclature but carries significant legal implications, particularly in terms of service benefits and protections." The judgement was authored by Justice Mehta.

It found that "In the present case, the totality of circumstances indicates that despite their formal classification as temporary employees, the appellants' employment bears substantial hallmarks of regular government service. The denial of pensionary benefits solely on the basis of their temporary status, without due consideration of these factors, appears to be an oversimplification of their employment relationship with the government. This approach runs the risk of creating a class of employees who, despite serving the government for decades in a manner indistinguishable from regular employees, are deprived of the benefits and protections typically accorded to government servants." It concluded: "we are of the opinion that the denial of pensionary benefits to the appellants is not tenable or justifiable in the eyes of law as the same is arbitrary and violates the fundamental rights as guaranteed by Articles 14 and 16 of the Constitution of India. It is indeed relevant to note that the appellants’ batch seems to be the last in their genre of SSD Fund temporary employees and thus, manifestly, the direction to extend the benefits of the 630 the RP Rules to the appellants shall not form a precedent so as to have a detrimental effect on the financial health of the SSD Fund." 

The Court observed: "we are of the view that the impugned judgment rendered by the High Court does not stand to scrutiny and the same is unsustainable in the eyes of law and is set aside. The respondents are directed to extend the benefits of the 6th Central Pay Commission including the pensionary benefits under the Revised Pay Scale Rules, 2008 to the appellants herein in the same terms as are being afforded to their peers in the Accounts Section of SFF HQ Estt. No. 22."

Upon attaining the age of superannuation i.e., 60 years, the six appellants claimed pensionary benefits under the 6th Central Pay Commission. Rajkaran Singh, appellant No. 1 filed a representation to the Union of India through the Special Secretary, Cabinet Secretariat, New Delhi, the respondent No. 1 seeking pensionary benefits under the 6th Central Pay Commission on July 28, 2011. The pensionary benefit was rejected on October 15, 2012, on the ground that he was not a government employee and had not been appointed by following any Recruitment Rules. Therefore, the Central Civil Services (Pension) Rules, 1972 would not apply to him. Similar representations of the other appellants were also rejected based on the same reasoning. All the appellants were appointed to manage the Compulsory Saving Scheme Deposits (SSD) Fund of the Special Frontier Force (SFF) in various positions. 

Notably, the SFF was raised by the Intelligence Bureau in the immediate aftermath of the 1962 China-India war. An unavailable thesis by Kalsang Ringchen entitled "Special Frontier Force---Unveiling the Secrets" (2011) throws some light on SFF. 

Supreme Court's Division bench relied on the legal framework established by the Court in various landmark decisions in Ajay Hasia and Others Vs. Khaled Mujib Sehravardi and Others (1981) 1 SCC 722 and Pradeep Kumar Biswas Vs. Indian Institute of Chemical Biology and Others (2002) 5 SCC 111. In Ajay Hasia and Pradeep Kumar Biswas cases, the Court dealt with determining whether a corporation could be considered an instrumentality of the state, the principles laid down therein provide valuable guidance in assessing the nature of employee-employer relationships.  

In Ajay Hasia case, the Court observed: “7. If a corporation is found to be a mere agency or surrogate
of the Government, “in fact owned by the Government, in truth controlled by the Government and in effect an incarnation of the Government”, the court, must not allow the enforcement of fundamental rights to be frustrated by taking the view that it is not the Government and therefore not subject to the constitutional limitations. We are clearly of the view that where a corporation is an instrumentality or agency of the Government, it must be held to be an “authority” within the meaning of Article 12 and hence subject to the same basic obligation to obey the Fundamental rights as the Government. "

It drew on the Court's decision  in R.D. Shetty v. International Airport Authority of India (1979) 3 SCC 489 wherein the Court examined the question as to when a corporation can be regarded as an “authority” within the meaning of Article 12. The Court addressed itself to the question as to how to determine whether a corporation is acting as an instrumentality or agency of the Government and dealing with that question. It observed: “A corporation may be created in one of two ways. It may be either established by statute or incorporated under a law such as the Companies Act, 1956 or the Societies Registration Act, 1860. Where a corporation is wholly controlled by Government not only in its policy-making but also in carrying out the functions entrusted to it by the law establishing it or by the charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government. But ordinarily where a corporation is established by statute, it is autonomous in its working, subject only to a provision, often times made, that it shall be bound by any directions that may be issued from time to time by Government in respect of policy matters. So also a corporation incorporated under law is managed by a board of Directors or committees of management in accordance with the provisions of the statute under which it is incorporated. When does such a corporation become an instrumentality or agency of Government? Is the holding of the entire share capital of the Corporation by Government enough or is it necessary that in addition there should be a certain amount of direct control exercised by Government and, if so, what should be the nature of such control? Should the functions which the corporation is charged to carry out possess any particular characteristic or feature, or is the nature of the functions immaterial? Now, one thing is clear that if the entire share capital of the corporation is held by Government, it would go a long way towards indicating that the corporation is an instrumentality or agency of Government. But, as is quite often the case, a corporation established by statute may have no shares or shareholders, in which case it would be a relevant factor to consider whether the administration is in the hands of a board of Directors appointed by Government though this consideration also may not be determinative, because even where the Directors are appointed by Government, they may be completely free from Governmental control in the discharge of their functions. What then are the tests to determine whether a corporation established by statute or incorporated under law is an instrumentality or agency of Government? It is not possible to formulate an all-inclusive or exhaustive test which would adequately answer this question. There is no cut and dried formula, which would provide the correct division of corporations into those which are instrumentalities or agencies of Government and those which are not.” 

The Court proceeded to indicate the different tests, apart from ownership of the entire share capital. It observed: "There is also another factor which may be regarded as having a bearing on this issue and it is whether the operation of the corporation is an important public function. It has been held in the United States in a number of cases that the concept of private action must yield to a conception of State action where public functions are being performed. Vide Arthur S. Miller: The Constitutional Law of the ‘Security State’ [5 10 Stanford Law Review 620, 644]…. It may be noted that besides the so-called traditional functions, the modern State operates a multitude of public enterprises and discharges a host of other public functions. If the functions of the corporation are of public importance and closely related to Governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government. This is precisely what was pointed out by Mathew, J., in Sukhdev v. Bhagatram [(1975) 1 SCC 421] where the learned Judge said that ‘institutions engaged in matters of high public interest of performing public functions are by virtue of the nature of the functions performed Government agencies. Activities which are too fundamental to the society are by definition too important not to be considered Government functions'.”

The relevant tests gathered from the decision in the International Airport Authority case as follows:
“(1) One thing is clear that if the entire share capital of the corporation is held by Government, it would go a long way towards indicating that the corporation is an instrumentality or agency of Government. (SCC p.507, para 14)
(2) Where the financial assistance of the State is so much as to meet almost entire expenditure of the corporation, it would afford some indication of the corporation being impregnated with Governmental character. (SCC p. 508, para 15)
(3) It may also be a relevant factor … whether the corporation enjoys monopoly status which is State conferred or State protected. (SCC p. 508, para 15)
(4) Existence of deep and pervasive State control may afford an indication that the corporation is a State agency or instrumentality. (SCC p. 508, para 15)
(5) If the functions of the corporation are of public importance and closely related to Governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government. (SCC p. 509, para 16)
(6) ‘Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference’ of the corporation being an instrumentality or agency of Government.” (SCC p. 510, para 18)

The Court has established several tests to determine whether an entity can be considered an instrumentality or agency of the Government, and thus an "authority" under Article 12 of the Constitution of India in Ajay Hasia case. These tests include but are not limited to:
1. Extent of financial support from the government;
2. Deep and pervasive control of the government;
3. Functions performed are of public importance and closely related to governmental functions;
4. Entity enjoys monopoly status conferred or protected by the State;
5. The government department has been transferred to the entity.

In Pradeep Kumar Bishwas case, the Court has held that the tests laid down in Ajay Hasia case are relevant for the purpose of determining whether an entity is an instrumentality or agency of the State. Neither all the tests are required to be answered in positive nor a positive answer to one or two tests would suffice. It will depend upon a combination of one or more of the relevant factors depending upon the essentiality and overwhelming nature of such factors in identifying the real source of governing power, if need be by removing the mask or piercing the veil disguising the entity concerned.

In Vinod Kumar case, the Court observed: "the essence of employment and the rights thereof cannot be merely determined by the initial terms of appointment when the actual course of employment has evolved significantly over time."

The Division Bench of the Supreme Court fully associated itself with this principle. It found that it was
wholly applicable in the present case.

Bihar law increasing reservation for SCs, STs & OBCs to 65%, violates Articles 14, 15, 16 of Indian Constitution: Patna High Court

Drawing on  the decision of 9-Judge Constitution Bench of the Supreme Court in Indra Sawhney v. Union of India, 1992 Supp (3) SCC 217, Patna High Court's bench of Chief Justice K. Vinod Chandran and Justice Harish Kumar set aside the Bihar Reservation of Vacancies in Posts and Services (for Scheduled Caste, Scheduled Tribes and Other Backward Classes) Amendment Act, 2023 and the Bihar Reservation (in Admission to Educational Institutions) Amendment Act, 2023 as ultra vires the Constitution and violative of the equality clause under Articles 14, 15 and 16 of the Constitution, on June 20, 2024. The 87-page long judgement was authored by Justice Chandran.  

The Court concluded that the enhancement of reservations beyond the 50% limit is bad in law based on the principles of equality emanating from the Constitution, as laid down by the wealth of precedents which are equally binding on the Court and the State. The Court referred to the the 50% rule brought in by the verdict in Indra Sawhney case, which has been accepted by the Union Parliament while introducing clause (4-A) in Article 16, and which has been upheld in K. Krishna Murthy v. Union of India, (2010) 7 SCC 202.

The High Court drew from the decision in Jaishri Laxmanrao Patil v. State of Maharashtra, (2021) 8 SCC 1 is relied on, which reaffirmed the maximum of 50% in reservations as laid down in Indra Sawhney case; binding under Article 141. The prayer for reference of Indra Sawhney case to a larger bench was rejected clearly finding that the thumping majority of five judges out of nine was in favour of the reservations being limited to 50% while three dissenting judges held that reservation can only be lesser than 50%. Only one of the judges differed from this and found it possible even above 50%. 

It was found that M. Nagaraj v. Union of India, (2006) 8 SCC 212 also did not lay down any ratio that ceiling of 50% reservation can be exceeded by showing contemporary data regarding backwardness. The Commission which approved the reservation in excess of 50%, impugned in the cited decision, was found to have completely misconstrued the ratio of a number of Constitution Bench decisions, while taking the view that ceiling of 50% can be breached merely on the basis of quantifiable data. The decision in M. Nagaraj case was factored in where tests were laid down to judge the validity of affirmative action, which the impugned legislation herein fails to pass. The mere existence of power to implement an affirmative measure cannot justify an over-breadth, especially when there is a breach of the 50% limit.

The has recorded that there was absolutely no thought or deliberation, which went into such excessive reservation being granted and there was not even a reference to the Backward Commission constituted by a statute.  The National Backward Commission was not been consulted, which has a mandate as per Article 338 of the Constitution.

It also noted that the 50% reservation has a history of 120 years, it having been first legitimized by Rajarshi Sahoo Maharaj of Kolhapur who brought in quotas in the appointments to the government; a full 48 years before independent India adopted the Constitution. 

It was pointed out that equality forms a basic structure of the Constitution and to breach the 50% limit in granting reservations would cause interference to the basic structure.

Among other things the senior counsel of the petitioner referred to proofing error in the preamble of the amendment Act wherein "The affirmative measure has been wrongly termed a ‘major’ and for data, the word ‘date’ has been used."