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Judgment
Ashoke Kumar Dasadhikari, J.—The main controversy raised in this writ petition is whether Budge Budge College is covered under the Notification dated August 28, 2006 by which all private educational institutions were brought under the scope and ambit of the Employee''s State Insurance Act, 1948 (hereinafter referred to as "the said Act"). Learned Counsel for the writ petitioner would contend that the writ petitioner Budge Budge College affiliated to the University of Calcutta is not at all covered by the Gazette Notification since it is not a private educational institution. Learned Counsel would also contend that the inspection carried out by the concerned Insurance Inspector and the impugned recommendation for applying the provisions of the said Act as well as the notice of coverage dated April 16, 2007 are all without jurisdiction and as such nullity. He would contend that to come within the scope and ambit of the aforementioned notification the educational institution should be a private one and run by individual, group of individuals, trustees, corporate bodies or societies wherein twenty or more persons are employed or were employed. He would contend that the writ petitioner, Budge Budge College accepted the coverage under the West Bengal Collage (Payment of Salaries) Ordinance, 1978 for taking financial assistance from the State Government. Since the petitioner College is covered by the aforementioned Ordinance some restrictions are imposed on it. The restrictions imposed under the Ordinance are as follows:-
(1) No college shall incur any expenditure on capital account without the prior approval of the State Government.
(2) A college authority shall not allow free studentship beyond the limit fixed by the State Government in respect of that college.
(3) No college shall, without the previous approval of the State Government, revise the rates of tuition fees and other fees and charges.
(4) A college authority shall not allow, without the prior approval of the Director of Public Instruction, West Bengal or any officer authorised by him in this behalf any reduction of remission of fees:
Provided that the Principal of a college shall be competent to remit fines fixed for late payment of tuition and other fees.
(5) It shall be the duty of a college authority to collect tuition fees, fines and other charges from each and every student on the roll of such college, except those who are granted free-studentship, and such fees as may have been fixed for students enjoying such benefit and to pay the State Government seventy-five per cent of the assumed income.
A college authority shall within fifteen days of the expiry of a month deposit with the State Government under appropriate head of account as may be specified by the State Government seventy five per cent of the actual income of that month and may retain the balance for being spent on non-salary items of a recurring nature according to schedule of expenditure approved by the State Government.
In view of coverage under the aforementioned Ordinance the governing body of the College is obliged to comply with the directions of the Government. In case of failure to comply with the provisions of the aforementioned Ordinance the Government may by its order supersede the management of the College. The Ordinance has overriding effect. The Government''s power of suppression and control as stipulated under the Clauses 7, 8, 9, 10 and 11 of the aforementioned Ordinance is quoted hereunder:-
(1) If any college authority fails to comply with the provisions of sub-section (1) or the direction under sub-section (2) of section 6 of the State Government may, by an order in writing published in the Official Gazette, supersede the college authority for a period not exceeding one year at a time and appoint an Administrator to discharge the functions of the college authority.
(2) The State Government may, if it is satisfied that it is no longer necessary to retain the Administrator, cancel the appointment of the Administrator before the expiry of the period of supersession and make over the administration of the college to the college authority.
Every college shall submit to the Director of Public Instruction. West Bengal budget estimates for a year in advance by such date as may be specified by him.
The Provisions of this Ordinance shall have effect notwithstanding anything to the contrary contained in any other law or in my instrument or in any custom or usage.
The State Government may from time to time give such directions no inconsistent with the provisions of this Ordinance, to a college as may be necessary for carrying out the purposes of this Ordinance.
If any difficulty arises in giving effect to the provisions of this Ordinance, the State Government may, by order not inconsistent with the provisions of this Ordinance, remove that difficulty.
Learned Counsel drew attention of this Court to another memo No. 3(250) CGA dated 7th February, 1978, by which some more conditions were imposed which are to be carried out by the College. Item (a) to (h) of Clause 2 of the memo dated 7th February, 1978 reads as follows:-
By way of implementation of the Ordinance the following conditions shall have to be carried out.
(a) Grants will have to be released periodically by Director of Public Instruction or any officer authorized by the D.P.I. to the Colleges with effect from the current month to enable to make payment of salaries in full (including the College scales) to the teaching and not-teaching staff.
(b) It will be obligatory on the part of the Colleges to credit to the State Government under the following head of account 75% of the assumed income as defined in the Ordinance.
077-Education-E-University and other higher Education-I-Tuition and other fees-Non-Govt. Colleges.
(c) Each college will be free to utilize the balance 25% of such income for expenditure on recurring non-salary items according to the approved Schedule (copy enclosed).
(d) No college shall incur any expenditure on Capital Account without the prior approval of Government.
(e) No college authority shall allow free studentship beyond the limit fixed by Government.
(f) The rates of tuition and other fees and charges shall not be revised by any College without the previous approval of Government.
(g) No college authority shall allow, without the prior approval of the D.P.I. or any officer authorised by him in the behalf, any reduction or remission of fees.
(h) Every college authority shall submit quarterly statement of accounts of the assumed and actual income in a proforma enclosed herewith.
It was also contended that there are several other restrictions for incurring expenditures including capital expenditure for which prior approval of Government is necessary. It was also submitted that the College is managed and run by an elected governing body as per Section 93 of Calcutta University First Statute. Members of governing body includes nominated members of State Government and syndicate and Vice-Chancellor, etc. According to the learned Counsel, the governing body is the authority to run and manage the affairs of the College and not by any individual or individuals, and that too as per the Ordinance of 1978 and the subsequent circular and further directions which may be issued by the Government.
Learned Counsel for the petitioner would contend that the notification do not stipulate, in the event College is run by a governing body formed under the statutory provision of the Calcutta University First Statute, would also come within the ambit and scope of all "private educational institution". According to the learned Counsel under no circumstances the petitioner College could be a "private educational institution" run by individual or individuals or by a body or society or by trustees. Learned Counsel would contend that since the College in true sense is not at all "private educational institution" run by any individual, group of individuals, trustees, corporate bodies and societies, the question of applying the said notification do not arise. Learned Counsel also referred Chamber''s Dictionary to show the meaning of the word "private school" which means "a school run independently by individual or group specially for profit". Learned Counsel also referred Black''s Law Dictionary (Abridged), 5th Edition, to show the meaning of the word "run" meaning thereby to conduct, manage, carry on. He would further contend that the authorities later on realised the difficulty on their part to cover all educational institutions and accordingly they published another gazette notification on February 10, 2011 and under Clause 7 of the said notification it was notified that educational institutions (including public, private aided or partial aided run by individual, group of individuals, trustees, societies or other organisations) would be covered. Learned Counsel would also contend that the significant part of change is the inclusion of institutions whether aided or partial aided and managed by "other organisation". However, that notification is not the subject matter since no notice of coverage was issued under that notification to the petitioner College. He would also contend that in case of a "private educational institution" run by a private individual or a group of private individuals, there is a profit element but in the present case there is no profit element. It is not only covered by the Ordinance, 1978 but also the College is required to deposit 75% of its collection with the Government and the balance 25% is kept for incurring expenditure on account of daily expenses that is books, journals, etc. Learned Counsel would contend that the College is under the administrative control of the State Government, it cannot be a "private educational institution". Therefore, the prayers made in the writ petition should be allowed in favour of the writ petition.
Learned Counsel further contended that the question of applicability of the notification was questioned by the minority institutions in view of their minority status and in that case the similar argument was advanced that those institutions were not run by Government or it''s agency and, therefore, those are all "private educational institution" and also covered by the aforementioned notification. Learned Single Judge of this Hon''ble Court held in the judgment reported in The Salesian Province of Kolkata (Northern India) Vs. State of West Bengal and Others, that the distinction made in the field of national economy between private and public sector cannot be applied in the field of educational establishments and the petitioners'' in situations cannot be treated as private educational institutions for the sole reason of not being controlled by the State. The minority institutions were held not "private educational institution".
Learned Counsel appearing for the respondents authorities would contend that the notification which was published on August 28, 2006 is applicable to all private educational institution run by an individual, by group of individuals, societies and trustees. Since the petitioner College is not a Government College nor a sponsored College, it is certainly a private educational institution and according to him, the College is fully covered by the aforementioned notification.
It was contended that application of the provisions of the aforementioned Act was never questioned by the College authorities before the appropriate forum i.e. Employees Insurance Court, u/s 75 of the said Act, rather they accepted that they are covered by the notification. The College was inspected on March, 2007 and notice of coverage was issued on 16th April, 2007. They have submitted form No. 01 before the authority. According to him, at this stage they cannot contend that they are not covered by the notification or they are not private educational institution.
He also contended the notification was issued in consultations with the State Government and the State Government is a necessary party for proper adjudication of the matter. Unless the State Government is made a party in this proceeding, the proceeding must fail for non-joinder of necessary party.
Learned Counsel submitted that as per P.R. Aiyar''s Law Dictionary the word "private" means not public, not official but belonging or concerning to one or more individuals. According to the learned Counsel, the present College is managed by the individuals and the College has no escape rather to accept the scheme and to pay the dues as calculated by the respondent authorities.
Learned Counsel cited the decision in support of his submission reported in CBSE School Management''s Association Vs. State of Kerala, . Learned Counsel submitted that in that case the Division Bench of the Kerala High Court following the decisions of Hon''ble Supreme Court held that the Schools affiliated under CBSE are covered by the notification issued by the Government u/s 1(5) of Employees'' State Insurance Act, 1948.
Learned Counsel also cited another Single Bench decision of Rajasthan High Court, delivered in S.B. Civil Writ Petition No. 2291 of 2005 (Bhopalwala Arya Higher Secondary Managing Committee, Sri Ganganagar v. State of Rajasthan & Ors.) on 18th May, 2005 wherein it was held that the notification issued by the State Government cover the educational institutions.
Learned Counsel further submitted that in view of those two decisions this Court should declare that the writ petitioners are covered under the notification issued by the State Government and they should be subject to the provisions of Employees'' State Insurance Act, 1948.
In reply Mr. Chatterjee submitted that any private educational institution run by a private individual or a group with a profit motive may come within the scope of the notification but the petitioner is neither run by any individual or group nor having any profit motive. Otherwise also the petitioner cannot be said "private" since its management is lying with a governing body formed under a statute and such management is subject to some conditions under the Ordinance of 1978 and also subject to directions of Government. In case the directions are not followed, Government can supersede the governing body and appoint administrator. Therefore, the petitioner College is not a "private educational institution". He also submitted that two judgments cited by the learned Counsel appearing for the ESI Authorities are based on two different notifications like the subsequent one dated February 10, 2011 and those circulars are not the subject matter of the present writ application. Thus those decision are of no relevance in this case. However, the subsequent notification dated February 10, 2011 has not been applied in the present case.
This Court carefully considered the submissions made by the learned Counsel appearing for the respective parties. The main controversy involved in this case whether the petitioner College is coming within the scope and ambit to the notification published on August 28, 2006 and whether the concerned respondents are authorised and/or having jurisdiction to apply the notification and issue notice of coverage upon the petitioner College.
A plain reading of the notification would show that to come under the cover of the notification three conditions are to be fulfilled. Firstly, the educational institution is to be a private one. Secondly, it should be run by an individual, group of individuals, trustees, corporate bodies or societies and third is 20 or more persons are to be employed or were employed in any day of the preceding twelve months. So far third condition is concerned, there is no controversy and dispute. The College has more than 20 employees working. So far running of the institution by the bodies or individuals is concerned, it is without dispute that neither the College is run by an individual, nor group of individuals, nor trustees, nor corporate bodies or societies, rather it is managed and run by elected governing body formed u/s 93 of the Calcutta University First Statute. Therefore, neither it is fully controlled by an individual or group of individuals or trustees or corporate bodies or societies nor there is any profit motive. Accordingly, the second condition is not fulfilled. So far the first condition is concerned, all educational institutions should be private. Therefore, it would be very significant to note the meaning of the word "private". The word "private" means belonging to one particular person or group. Here in this case the College is neither belonging to a particular person or group nor it is run by a private body and no profit element is also available here, therefore, the petitioner College is not at all "private". Since two out of the three tests are not fulfilled it cannot come under the nomenclature "All Private Educational Institutions".
Moreover in view of taking aid from Government under 1978 Ordinance, the petitioners have obligation to deposit 75% of earning with the Government and they are to follow certain guidelines. In case of failure, the State Government have authority to supersede the College administration and have authority to appoint an Administrator to administer the functions of the College. The governing body is to be formed as per Section 93 of the Calcutta University First Statute and according to the statute, there would be university nominee, Government nominee, etc. The governing body is also not free to act according to their own decision rather they are subjected to Government guidelines and/or decisions and/or directions. Accordingly, the petitioner College cannot also be said a private educational institution in strict sense. Therefore, this Court is of firm view that writ petitioner is not covered by the said notification and the actions of the respondents are without jurisdiction and as such nullity.
So far non-joinder of State as a party is concerned, the State Government is not at all a necessary party in this proceeding, therefore, this proceeding is maintainable in their absence. The judgment cited by the learned Counsel for the respondents are not relevant and applicable in this case specially when the notification involved in those cases are totally different. Accordingly, the impugned notices being dated December 16, 2008, March 10, 2009 and March 25, 2009 are without jurisdiction and those are set aside and it is held that the petitioner College is not covered by the aforementioned notification. The writ petition is, thus, allowed. There would be no order as to costs.
Urgent Xerox certified copy of this order, if applied for, be supplied to the parties subject to compliance with all requisite formalities.
Ashoke Kumar Dasadhikari, J.