WHETHER WRIT PETITION IS MAINTAINABLE AGAINST A PRIVATE COMPANY?

WHETHER A TERMINATION ORDER CAN BE CHALLENGED IN WRIT PETITION

Violation of fundamental rights can be protected against private and public sector by vertical
and horizontal application. Vertical application of fundamental rights means the action can be
brought only against the state and not against any private sector. Contrary to this horizontal
application of fundamental rights can be enforced against the private sector.

Initially, after the enactment of the Constitution, the vertical application of fundamental rights
was sufficient. The reasoning behind making only the state responsible for the fundamental
rights of the citizens was the huge power and authority vested with it. To avoid the misuse of
such power and to stop it turning into a totalitarian state, the constitutional maker considered
it necessary to make state answerable for its action. State has to ensure the welfare of its
citizen and is bound by the principle of non-discrimination, natural justice and fairness.

In S. Babu and others v. Managing Director, Hindustan Teleprinters Limited (HTL),

The court in several cases reiterated the fact that the petition related to contractual matter
dealing entirely with the private sector will not be entertained in the court of law. The court
contended that matters relating to private contract should be dealt in civil court and the high
court or supreme court do not have jurisdiction to deal with the said cases. The jury further
added that the High Court can invoke its writ jurisdiction when public law remedy is
involved.

In 1991 with the emergence of Liberalization, Privatization and Globalization (LPG) policy,
the huge divide between public and private sector started diminishing. Increasing demand for
the lucrative goods of private sector increased their power in the market. And the continuous

1
Babu and others v. Managing Director, Hindustan Teleprinters Limited (HTL), Chennai and others, 2013 (3)
Tmi 339 Madras Hc
dereliction of the state control is resulting in the distribution of power in the private sector.
With the growth of the private sector, there is an increase in the power hold by private bodies.

With the advancing society, people have started recognizing their rights and the fact that
these rights are not only violated by the state but also by the private bodies. To protect and
safeguard the rights of an individual in such circumstances horizontal application of
fundamental rights is implemented by the constitutional court.

There are certain fundamental rights which even the private sector cannot violate and in case
of violation of those rights, those sectors could be held liable. Article-15 under part III of the
constitution prohibits discrimination on the grounds of sex, caste, race, and any kind of
violation of this right punishes both private and public sector equally. Similarly in Article 17,
21, 23 and 24 horizontal application of fundamental is applied.   

Another very important reason why the horizontal application of rights should be applied is
the concern of the privacy of an individual because of the advancing technologies. There are
various ways by which today’s expanding Private IT sector could easily manipulate the data
of individuals. Moreover if in such circumstances actions are not taken by the court against
the private sector than it will further encourage these sectors to manipulate data to fulfil their
ulterior motive. 

In fact Article-21 of the constitution which deals with life and liberty of an individual states
that “no person shall be deprived of his or her personal liberty except the procedure
established by the law. The modern definition of personal liberty also includes Right to
Privacy. The application of Article 21 is not restricted to state only but is also extended to
non-state actors, i.e. private sector. Similar to Article 21, Article 19 is also established
without restricting only to state. In Vishakha v. State of Rajasthan2, the court reiterated that
the safety of women at workplace is their fundamental right and it should be adopted
mandatorily by both public and private sector.

The citizen can surely file a writ petition under Article 32 of the Supreme Court, against the
public sector against the act or omission of fundamental rights. However, this right with the
citizens is only applicable to the public sector and its applicability in the private sector is
limited to only a few cases. 

2
Vishaka & Ors. v. State of Rajasthan, AIR 1997 SC 3011
A writ may be granted "to any individual or jurisdiction" and "for execution of any of the
rights conferred by Part III and for any other reason," according to Articles 32 and 226 of the
constitution. The spectrum is unquestionably wide and can be viewed in a variety of ways.
The Supreme Court has attempted to clarify its position on whether a writ claim can be
lodged against a private corporation by its decisions in Tekraj Vasandhi v. Union of
India, General Manager,  Kisan Sahkari Chini Mills Ltd. v. Satrughan Nishad  ,Pradeep
Kumar Biswas v. Indian Institute of Chemical Biology and Ors .

In this respect, the case of S.D. Siddiqui v. University Of Delhi And Ors.3 is a landmark
judgement.

The court upheld its position, as it did in Binny Ltd. v. Sadasivan4, where the Supreme
Court stated that a writ could only be issued against a private entity if it has done a public
service or discharged a public obligation. The court clarified this public role or responsibility
in the S.D Siddiqui case: “A private entity or an individual can be subject to writ jurisdiction
only if it becomes appropriate to require that body or organisation to enact any constitutional
or public-law requirements that impose positive obligations on it.”

Ordinarily, a writ petition may only be filed against the state or its organs, or an individual
holding public office who is discharging his duties in that capacity. Writ petitions are usually
filed in response to a breach of a fundamental right as specified in Part III of the Indian
Constitution. To summarise, a writ against a company is not maintainable unless the
company is doing a public service.

With the development of law relating to judicial review of administrative actions, a writ
Court can now examine the validity of a termination order passed by public authority. It is no
longer open to the authority passing the order to argue that its action being in the realm of
contract is not open to judicial review. A writ Court is entitled to judicially review the action
and determine whether there was any illegality, perversity, unreasonableness, unfairness or
irrationality that would vitiate the action, no matter the action is in the realm of contract.

GRID-CO Limited & Anr. v. Sri Sadananda Doloi & Ors. 5: Supreme Court held that
Termination of contractual job can be challenged in the court.

3
LPA 2256/2005
4
(2005) 6 SCC 657
5
Civil Appeal No. 11303 of 2011
Marwari Balika Vidyalaya V. Asha Srivastava & Ors 6: The Apex Court on 14th Feb in
the matter of Marwari Balika Vidyalaya V. Asha Srivastava & Ors has held that “a writ
petition challenging the termination of services of a teacher is maintainable against a private
unaided educational institution”. Court held that A division bench of Apex Court While
dismissing the appeal remarked that the cases referred by the appellant have factual matrix
which is different from the present matter. The bench relied on to the decision of Raj Kumar
v. Director of Education and others 7 in which it was held that “approval of the government
education authorities was necessary even for dismissal of a private school employee”.
However, in present scenario no such approval was obtained by the school in the instant case
before retrenching the teacher. The bench in its judgment also referred to the decision
in Ramesh Ahluwalia vs State of Punjab8 which had held that the employee of a private
school can file writ petition in relation to service disputes. The court in present matter after
referring to Raj Kumar and Ramesh Ahluwalia judgment came to a conclusion that school is
discharging a 'public function' and Hence writ was maintainable against it. The bench
observed that "It is apparent from the aforesaid decisions that the Writ Application is
maintainable in such a matter even as against the private unaided educational institutions".

6
Civil Appeal No.9166 Of 2013
7
[Civil Appeal No. 1020 of 2011]
8
Civil Appeal No. 6634 Of 2012