KAPILA HINGORANI versus STATE OF BIHAR

KAPILA HINGORANI versus STATE OF BIHAR

State of Bihar has a constitutional and fiduciary obligation to mitigate suffering caused by non-payment of salaries in its public sector undertakings; financial stringency cannot absolve the State from responsibility when fundamental rights are at stake; liability cannot be shifted to Union of India or State of Jharkhand.

Parties
Petitioner: Kapila Hingorani; Respondent: State of Bihar; Respondent: State of Jharkhand
Jurisdiction
India
Judgment Date
09 May 2003
Procedural Posture
Writ Petition (c) No. 488 of 2002 / Interim Order Issued; Matter Pending
Outcome
Interim directions issued; State made liable to mitigate employee suffering; matter pending.
Legal Topics
Non Payment of Salaries, State Liability, Public Sector Undertakings, Right to Livelihood, Piercing Corporate Veil, Directive Principles, Fundamental Duties
Constitutional Law Labour Law Human Rights Corporate Law Non Payment of Salaries State Liability Public Sector Undertakings Right to Livelihood +3 more

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Parties

Kapila Hingorani

Petitioner

State of Bihar

Respondent

State of Jharkhand

Respondent

Procedural Posture

Writ Petition (c) No. 488 of 2002 / Interim Order Issued; Matter Pending

Legal Issues

  1. 1 Whether State of Bihar is vicariously liable for payment of arrears of salaries to employees of State owned corporations, public sector undertakings or statutory bodies
  2. 2 Whether financial stringency is a valid ground for non-payment of salaries resulting in violation of fundamental rights
  3. 3 Whether liability of Bihar can be shifted to Union of India or Jharkhand

Ratio Decidendi

State of Bihar has a constitutional and fiduciary obligation to mitigate suffering caused by non-payment of salaries in its public sector undertakings; financial stringency cannot absolve the State from responsibility when fundamental rights are at stake; liability cannot be shifted to Union of India or State of Jharkhand.

Court Disposition

Interim directions issued; State made liable to mitigate employee suffering; matter pending.

Orders

  • High Court to expedite liquidation proceedings of government companies of Bihar.
  • Committee of up to three members, chaired by retired High Court Judge or District Judge, to report on assets/liabilities within three months.