P.C. Sen vs Department Of Personnel And Ors.
2006 Latest Caselaw 1164 Del

JUDGMENT

S. Ravindra Bhat, J.

1. In these writ proceedings the claim is for a direction to the Respondents to provide "retirement air passage" to the Petitioner and his family. The petitioner had worked as Managing Director of the third respondent. The first Respondent in these proceedings is the Central Government, through the Department of Personnel and the third Respondent, the Indian Airlines Corporation (hereafter called as the "IA").

2. The facts for the purposes of deciding this petition may be briefly set out as follows.The Petitioner was appointed in 1967 to the Indian Administrative Service (hereafter called as the "IAS"). During his tenure in the service, he was appointed as Managing Director of the IA on 1.3.1994, for three years, on deputation basis. Before the deputation period ended, the Petitioner was also entrusted charge as Chairman of IA, and Air India on 27.2.1997. He relinquished charge on 12.12.1998. After serving with the Central Government, he retired from the service w.e.f. 1.5.2003.

3. At the time of his deputation/appointment to the Indian Airlines, the terms of his appointment were indicated in the letter issued by the Ministry of Civil Aviation dated 9.11.1994. The appointment letter/order outlined the deputation/period of appointment, stipulations about pay, and other conditions as to accommodation, house rent allowance, conveyance allowance, leave etc. Clause (xvii) of the appointment letter read as follows:

(xvii) " Residuary Matters" : In all matters relating to the conditions of service not covered by items (i) to (xvi), he will be governed by the Rules/Regulations/Orders applicable to a Member of the Indian Administrative Services, serving in connection with the affairs of the Union.

4. Apparently, the IA evolved a policy of extending free air facility to its personnel. This was by virtue of resolutions adopted by its Board of Directors and regulations/guidelines issued from time to time. The 4th Meeting of the Board held on 27.6.1994 apparently resolved that officers deputed, upon completion of their term should be extended benefits which retired officers of such status were granted. In its subsequent Meeting (i.e. 8th Meeting) the issue of free air passage facility to members of the Board was to be considered. The Board of IA also took note of the Minutes of the Meeting recorded by the Air India and eventually resolved as follows:

i) The minimum period that officers should serve before vacation of office, either by retirement or on completion of deputation, to become eligible to avail air travel facilities for them and their family should be 3 years.

ii) In the event of the demise of the Chairman or the Manging Director, air travel facilities will continue to be provided to the spouse of the officer.

iii) These guidelines approved by the Board would apply to past cases of the Chairman and Manging Directors.

The Board also discussed the question of providing free passages to members of the Board. It was decided that all members of the Board will, while serving on the Board, be entitled to 12 free passages per annum, which could be utilised by either members of the Boards or their spouses. These passages would be provided on a firm basis.

5. On 4.10.1996 the Director Personnel, IA wrote to the Government of India seeking clarification as to the Petitioner's entitlement to free air passages, having regard to his deputation to the IA. He drew the attention of the Central Government to conditions of deputation of other personnel who were members of All India Services for whom residual conditions stipulated that the rules and conditions of service applicable to Indian Airlines officials, would prevail.

6. On 16.12.1996 the Ministry of Civil Aviation wrote to the Air India Limited and IA indicating the position of the Central Government. That letter (hereafter "the Presidential directions") is extracted below:

Sub: Free passages to the Directors of Air India Board - regarding.

Sir,

It has been brought to the notice of the Government that the Board of Air India, in its 25th Meeting held on 30.11.1996, has passed a resolution, allowing the post retirement passage facility to the Chairman, part-time Chairman, Managing Director, including those appointed from outside or on deputation, including those appointed in an acting capacity subject to completion of two years in matter has been examined by the Ministry of Civil Aviation and the above resolution of the Board has been found to be in violation of the instructions issued by this Ministry vide letter No. 2844 JS&FA/92 dated 27.4.1992 and letter passages. Therefore, the Central Government in exercise of the powers conferred by Section 9 of the Air Corporation direct the Air India Limited to adhere to the following directions with regard to the issuance of the air passages:

(a) Post retirement passages may be allowed on retirement or on resignation of Managing Directors including those appointed in acting capacity, provided they have been in continuous employment with the Corporation in any capacity for a period of three years.

(b) In respect of Part-time Chairman and/or Managing Director, the passages may be given by the Management only during their tenure in that capacity, provided that if such part-time Chairman and/or Managing Director come from official cadre (government service), they will not be eligible for any passages even during their tenure in the airline.

(c) Part-time Directors of the airlines whether official or otherwise will also not be eligible for passages, either during their tenure or afterwards.

2. The above directive will be applicable mutates mutants to Indian Airlines Limited also.

3. Necessary action may be taken by the Managements of Air India Limited and Indian Airlines Limited to implement the directive immediately.

4. The receipt of the letter may kindly be acknowledged.

Yours faithfully,

Sd/-

(L.INDUMATHY)

Under Secy. to the Govt. of India

7. In view of the above letter the Director Personnel sought a further clarification as to whether full time Managing Directors appointed from outside or deputed, to the corporation, and in continuous employment with IA for three years would be eligible to the facility upon their demitting office. In clarification to the query, the Central Government wrote back on 28.1.1997 stating that such full time Managing Directors appointed on deputation would be eligible for free passes, if admissible in terms and conditions of their appointment, issued by the Competent Authority. The letter reads as follows:

To

The Director (Personnel),

(Attn : Shri Gurdip Singh),

Indian Airlines Limited,

Airlines House,

New Delhi

Subject : Free passages to the Directors of Air India Board -regarding.

Sir,

I am directed to refer to your letter No HPDO1/DP-19 dated 21st December, 1996 on the above subject and to clarify that the full time Managing Director appointed on deputation basis would also be eligible for free passages, if admissible under the terms and conditions of their appointment, issued by the competent authority.

2. The answer to all the other queries in your said letter of 21st December, 1996 is in the affirmative.

Yours faithfully,

Sd/-

(L.INDUMATHY)

Under Secy. to the Govt. of India

8. Apparently, at the behest of the Petitioner, information was elicited about personnel who were deputed to the IA and who enjoyed the facility of free air passages. By a letter dated 4.11.1997, the Director Personnel, IA wrote to the Central Government seeking for amendment of the Petitioner's terms of deputation in so far as they pertained to residual matters; the amendment was for substitution of the existing condition with the stipulation that in respect of other allowances and conditions, the rules of Indian Airlines Limited would be applicable to the deputationist (i.e the petitioner would be governed by Rules governing Indian Airlines personnel). The Petitioner also appears to have addressed letters to the Central Government whilst he was in service and even after he relinquished charge as CMD, Indian Airlines.

9. Eventually, in response to the request addressed on the Petitioner's behalf for amendment of the conditions of service, the Central Government on 14.1.2000, partially modified residual Clause (xvii) and permitted him to draw productivity linked incentives and allowances. The Petitioner addressed a series of letters between January 2000 and July 2003 to the Central Government and the Indian Airlines. On 23.7.2003, the Indian Airlines wrote him a letter recapitulating the previous understanding of the Government that the conditions could be amended only in respect of two allowances; it also stated that no further amendment to the conditions of the Petitioner's deputation had been permitted.

10. The Petitioner alleges that withholding of the free air passage facility, is arbitrary. It is averred that both in terms of the Board resolutions as well as the Government's directives, he is entitled to the facility, having worked for more than three years as Managing Director. It is also claimed that the withholding of such facility from the Petitioner and granting it to others who had served on deputation or worked otherwise with the Indian Airlines for more than three years is discriminatory. The Petitioner alleges arbitrariness in the denial of the facility because in case of other deputed officials, the residual clause had incorporated the condition of extension of Indian Airlines terms and conditions which entitled such privileges. In the petitioner's case, however the residual condition in the letter of appointment did not contain such a condition and that his request for amendment was declined without any rationale.

11. The stand of the Central Government is that the issue of free air passages was not specifically stipulated in the terms and conditions of appointment of the Petitioner as MD, IA. As far as residual conditions were concerned, his entitlement as Member of the All India Services was reiterated in Clause (xvii). It is also averred that the representation for amendment of the conditions was accepted only in order to entitle him to productivity linked incentives for the period of his tenure, to ensure that he did not suffer monetarily in any manner vis-a-vis employees of the organization, who were extended such monetary benefits.

12. On the issue of free air passage/passes for the Petitioner and his family, for the post retirement period, the Central Government avers that it was found to be inadmissible as perks and privileges admissible in deputation posts are always limited to the period of deputation and not beyond that period. It is further alleged that extension of such privileges beyond the tenure would imply treating deputation as itself a source of profit. It is also averred that the Petitioner, as Member of the IAS was to retire from his services after the completion of his deputation and grant of free air passes after his exit from the IA would provide him with unintended benefit would be undesirable.

13. The Central Government has also averred that the Ministry of Civil Aviation asked the Ministry of Personnel to have a fresh look into the matter; the issue was reconsidered in the light of the provision of standard terms and conditions and with reference to similar facilities available for deputationists in Indian Railways. The Central Government has placed reliance on standard terms and conditions issued by the Department of Personnel on 10.8.1998, said to be applicable at that time; it is averred that the document does not provide for entitlement for free air passes for the Petitioner and his family after his retirement from the organization. A copy of the standard terms and conditions has been produced along with the counter affidavit.

14. The third Respondent, in response to an order of the Court dated 17.8.2005 filed an affidavit indicating the list of its Chairman from the year 1985 onwards; it is also disclosed the source of recruitment of such persons and their tenures. The list contains 17 names. After considering the affidavit this Court had called upon the IA to file a further brief affidavit about who among the 17 names disclosed, were beneficiaries of the air passage scheme. The IA has averred that as per its understanding 7 persons who had worked in various capacities and were on deputation and/or drawn from outside organizations were eligible to the free air passage facility on Indian Airlines, during their lifetime on "as required basis". The IA has also averred that 5 out of the 7 names indicated were ineligible for extension of the facility and a decision to withdraw the facility is being taken separately.

15. Mr. C.A. Sundram, learned senior counsel appearing on behalf of the Petitioner submitted that the Respondents have adopted a highly arbitrary and discriminatory position while denying the facility of air passage to the Petitioner. It was submitted that both in terms of the Board Resolution as well as the Presidential directive, there was no impediment for the grant of facility of retirement air passage. Particular reliance was placed upon paragraph 9(1) of the Minutes of Meeting of Board dated 21.2.1995 and Clause (a) of the directive. Counsel submitted that cumulatively, these entitled post retirement passages, upon retirement or on resignation of Managing Directors, provided they had been in continuous employment with the Corporation in any capacity for at least three years. It was submitted that the position of the Central Government not to grant air passage to the Petitioner is premised on a misunderstanding of the directive which merely disentitled part time Chairman/Managing Directors and those who had not been in continuous employment for less than three years. The Petitioner, it was contended has served for more than three years, in full time capacity, and was entitled to the facility.

16. Learned Counsel also submitted that the presidential directive and the position taken by the Board of Directors were neither restrictive, nor ambiguous. The Central Government wanted to limit or restrict the facility to those who had served within the organization for some time as Managing Director and in continuous full time capacity for more than three years. However, air passages were granted to part time Managing Directors/Chairman/Directors only for the period of their tenure. The intention, clearly was to restrict the facility in the case of those serving for short durations and in part time capacity to the periods of their tenure to grant, as a service benefit to all those, had served for more than three years. It was submitted that the facility of air passage to heads of air corporations/ air carriers was not peculiar to IA or Air India but is a lifetime facility agreed to be granted by IATA (International Air Travel Association) guidelines.

17. Learned Counsel submitted that the stand of the Government in declining the request for amendment of the Petitioner's terms and conditions of service were discriminatory. He relied upon a number of previous instances whereby personnel sent on deputation Air India/Airlines enjoyed Indian Airlines conditions as their residual service of condition. Consequently they were entitled to air passages. The Petitioner too fell within the same class, being member of the All India service, deputed to the IA. But in his case the residual condition did not incorporate that terms and conditions applicable to IA officials would govern his service. There was no rationale for this distinction because the Petitioner as well as the others who had been deputed earlier, fell within the same class of deputed officials who were Members of the Indian Administrative/All India Services. The Respondents could not therefore pick up one amongst the same class for hostile treatment.

18. Learned Counsel lastly submitted that the letter dated 28.1.1997, by which the Central Government which communicated that the Petitioner's eligibility for free passages would be considered if admissible under the terms and conditions of the appointment was mischievous and contrary to the Presidential directive. It was claimed that the letter though written by the Central Government, could not supersede the presidential directive which defined the entitlement and eligibility of Managing Directors to post retirement passages.

19. Learned Counsel for the Central Government submitted that the Petition ought not to be entertained since internal correspondence between the Indian Airlines and Central Government which formed part of the decision making process, has been relied upon in these proceedings. It was submitted that the Petitioner came into possession of such documents by misusing his office as Chairman and Managing Director of the IA and therefore on this ground itself the writ petition has to be rejected. It was also submitted that the Petitioner being a Member of the IAS, could only claim a right in respect of the terms and conditions governing his service. As a deputationist, he was entitled to such allowances or other conditions of service which were applicable to him as per his conditions of service as a Member of the IAS and such further conditions as were permitted in terms of the deputation. He could not lay claim beyond that. It was therefore, contended that the entitlements of the Petitioner were squarely covered by the Rules applicable to the Indian Administrative Service and the conditions of deputation. Air passages were not contemplated in the terms of deputation; the letter explicitly provided that in regard to matters not provided for, the Petitioner would be governed by Rules applicable to Members of IAS.

20. Counsel also submitted that the object of the presidential directive was to ensure that air passages were not indiscriminatorily and widely used since they constitute valuable public resources. It was therefore understood by parties that those not employed in the organization but deputed from outside were disentitled to such terms or facilities. If this aspect was kept in mind, the question of granting the facility to all employees who worked as Managing Directors for more than three years would never arise at all. It was submitted that such a liberal interpretation would result in undermining the commercial activities of the Airlines and amount to granting unintended profit to Members of other services enjoying facilities as per their own terms and conditions. Counsel submitted that Department of Personnel had clarified that in such cases the uniform practice ought to be to insist that such personnel, sent on deputation would be governed, by the conditions of their substantive service in regard to residual matters.

21. Mr. R.S. Suri, learned Counsel for the IA adopted the submissions on behalf of the Central Government and further stated that as per his instructions and the additional affidavit, only 7 persons were found eligible for air passages of whom 5 were determined to be disentitled and that steps were being taken to withdraw the facility. The learned Counsel also submitted that there is no record as to the number of air passages which are granted and submitted that as per the available records a chart had been prepared, to illustrate the extent of facility that were used. The chart produced discloses the names of 4 persons who were granted the air passage facility between 2000 and 2005. The chart shows that for this period the said 4 persons have availed of 53 free air passages and 55 air passages, on 95% concession basis.

22. The issue therefore, is whether the petitioner is entitled to the free air passage facility, post his retirement/ repatriation from the Indian Airlines, as per the Board of Directors' (of IA) resolutions, and also the order/ directives of the Central Government, and whether the refusal of the Central Government, to amend the terms of his appointment, as per his request, is either arbitrary or discriminatory.

23. There is and can be no dispute that the petitioner, as a member of the IAS, is entitled to such allowances, perks, benefits, and facilities, as are prescribed by rules, framed under the All India Services Act, as well as circulars, and guidelines issued in that regard. The question therefore, is whether he can insist upon other facilities, (which are not part of the prescribed conditions of his service, but were extended to him when he was on deputation), after the tenure of his deputation ended.

24. The facts are not seriously disputed; the petitioner was appointed on a tenure, in the Indian Airlines, as its Managing Director; he was a deputationist from the IAS. His tenure was finite; later it was extended for a further period, and he eventually repatriated to the substantive service. The terms of his service are contained in the All India Services Act, rules framed under that enactment, and circulars, etc. Whilst on deputation, his terms and conditions were stipulated in the order of appointment/ deputation. The petitioner unreservedly accepted those terms; they unambiguously stipulated that as regards matters not provided for, the conditions applicable to members of the IAS would govern him. The terms of IAS officers do not admit of free air passage, after repatriation/ resignation/ retirement.

25. The expression "deputation" in service law terminology has been commented upon by the Supreme Court, in State of Punjab v. Inder Singh and Ors. 1997(008) SCC 372, where, the court held as follows:

The concept of "deputation" is well understood in service law and has a recognised meaning. "Deputation" has a different connotation in service law and the dictionary meaning of the word "deputation" is of no help. In simple words "deputation" means service outside the cadre or outside the parent department. Deputation is deputing or transferring an employee to a post outside his cadre, that is to say, to another department on a temporary basis, After the expiry period of deputation the employee has to come back to his parent department to occupy the same position unless in 3 the meanwhile he has earned promotion in his parent department as per the Recruitment Rules. Whether the transfer is outside the normal field of deployment or not is decided by the authority who controls the service or post from which the employee is transferred. There can be no deputation without the consent of the person so deputed and he would, therefore, know his rights and privileges in the deputation post. The law on deputation and repatriation is quite settled as we have also seen in various judgments which we have referred to above. There is no escape for the respondents now to go back to their parent departments and working there as Constables or Head Constables as the case may be.

26. A public employee, sent on deputation, with his consent, to another public department or organization, has no right to the latter post; (the exception to this rule could be perhaps, where the employee, is recruited to the organization, and where deputation is a mode of regular recruitment, leading to absorption with the recruiting organization). Such a deputationist's right to the post is tenuous; he does not even possess the right to insist that the tenure should be completed, nor can he say that his employer, with whom he holds a substantive appointment, cannot recall him. Normally, disciplinary control too vests with the substantive employer. In regard to conditions of service, too, the various authorities have held that deputation service, or conditions of service enjoyed during that period, do not vest in the employee, upon his repatriation to the substantive employer. In V.S. Murthy v. Union of India AIR 1992 SC 1742 it was held as follows:

The deputation of a railway servant to foreign service is a fortuitous assignment and since, there is no settled method of selection of the railway servant for being sent on deputation to foreign service, the life long benefit of having the deputation duty allowance included for calculation of pension may result in hardship and injustice to those railway servants who were not so sent on deputation even though senior or more qualified than the person sent on deputation. It is for this reason that while the deputationist may receive the deputation (duty) allowance for the service rendered on foreign service during the period they remain on deputation that deputation (duty) allowance has been excluded from being taken into account for purpose of calculation of pension.

Other decisions of the Supreme Court too have reiterated the principle that privileges and allowances extended to an employee for the duration of his deputation cannot be claimed as a matter of right, upon his recall by his substantive employer. Therefore, it was held that Deputation allowance cannot be included in calculation of pension (Ref: R.N. Rajanna v. State of Karnataka ). In Puranjit Singh v. Union Territory of Chandigarh 1994 Supp (2) SCC 471 it was held that when a deputationist was repatriated, he could not claim promotions in the parent department on the basis of officiation in a higher post in the borrowing organisation.

27. It would therefore, be apparent that the petitioner cannot claim the privilege of air passage, which he was entitled to as a Managing Director of IA, after his repatriation, as a matter of right. He therefore moved the Central Government to amend the conditions of his deputation. The question in this regard is whether the refusal of the Government to amend such conditions, is arbitrary, and also discriminatory, since others had been previously extended such conditions in their deputation orders. The explanation of the Central Government is that the appointment (or, deputation) order of the petitioner was clear, in that it alluded to the conditions applicable to IAS officers, in matters not provided for. The Government has also relied upon a department of Personnel circular of 1998 stressing the need to follow uniform guidelines, incorporating that in regard to matters not specifically provided for, the conditions of service applicable in substantive employment/ All India/ Central Government service would apply. I see no arbitrariness in this position. The above object of the guidelines, i.e bringing about uniformity, is a much desired standard, or else, there would be asymmetrical or discordant treatment within the same group of officers, who might be posted on deputation to different organizations. The principles or standards have to be non-discriminatory, so as to avoid differential treatment, based on subjective factors, such as the resources and perks available within the borrowing organization. Left to itself, this would lead to an unseemly and undesirable "scramble" for postings which are seen to be more attractive, in that they afford more perks and privileges. As far as the aspect of discrimination is concerned, in so far as extending the benefit of air passage to other All India service officers who had served in similar positions in the past, it is well settled that since the petitioner was not entitled to the benefit in the first instance, there can be no question of his claiming it on the basis of past instances, where serving All India or Central Government officers were given that benefit, on the basis of inclusion of the conditions applicable to IA employees in their appointment orders. However, I am of the opinion that consistent with the position in law that such deputationists cannot claim rights over service conditions which are not primarily applicable to them and also consistent with the policy and guidelines of the Central Government that the conditions primarily applicable to the substantive service of such employees would prevail, appropriate directions are called for to ensure that henceforth, such benefits are not extended.

28. The other main grievance is that the Board resolution and the Presidential directive do not prohibit the air passage to the petitioner, who had served for more than 3 years as a full time managing director. The records, particularly, the Agenda for the 8th Meeting, in 1995, show that the existing guidelines had led to some ambiguity about the entitlement of Chief Executives/ Chairmen, joining IA or Air India from outside organizations, or on deputation. The agenda also dealt with a resolution of the Board of Directors, 24th November, 1976 accepting the suggestion of Shri J.R.D Tata, that free "air passage facilities on Indian Airlines flights should be extended to retired Chief Executives of the Corporation and their wives during their life time on an 'as is where is required basis' ". The agenda note also records that the air passage facilities were being enjoyed at par with employees of the IA, till 1987. The issues were again discussed in a meeting of the Board of Directors of Air India, dated 31-3-1991, when the Government nominee director had desired that the matter ought to be referred to the Central Government under provisions of the Air Corporations Act, 1953. Pursuant to this, the Central Government issued guidelines, on 27-4-1992. The first two paragraphs of the guidelines are identical in terms with the Presidential Directive, dated 16-12-1996. The third paragraph, however states as follows:

It is clarified that those Chairman who come from the official cadre (Government Service) will not be eligible for any passages even during their tenure as part time Chairman.

29. A combined reading of the three documents, viz the Agenda Note, the Board Resolution of 1996 and the Presidential Directive, points out at the Central Government's endeavor to restrict the entitlement to "free air passage facilities" to Managing Directors and Chairmen, after their retirement/ resignation provided that they had been continuously employed for more than three years in the Indian Airlines. The terminology might not fully convey the intention, as there is no express mention of the entitlement of officers working full time, with the Indian Airlines. This has caused some room for argument, that in the absence of any prohibition, such a full time Managing Director/ Chairman, drawn from the Central Government service would be entitled to the benefit. Attractive though the submission may be, it cannot be accepted uncritically. The "presidential directive" clearly refers to "continuous employment" of an official for three years in the Indian Airlines, as a condition for extension of the benefit. As explained in the previous portion of this judgment, a deputationist is always an employee of the substantive employer; his terms and conditions of deputation are settled by the lending organization/ substantive employer, who retains disciplinary control, and is also at all times during the period of deputation, under an obligation to provide such deputationst with all the beneficial terms available to him, or to which he might be entitled (seniority, promotion, etc) even during his deputation period. At no time, therefore, can the deputationist lay claim, as a matter of right to any changes in terms and conditions of service, brought about in the borrowing organization, as a matter of right. Therefore, I am of the opinion that a deputationist like the petitioner, who continues to hold lien in a parent organization, and secure all benefits of employment there, cannot be considered as being "in continuous employment" for three years or more, to qualify for the air passage facility, even after his deputation period ends, and he returns to the parent organization. The second, and perhaps more compelling rationale would be that acceptance of the petitioner's argument, logically would imply that deputationists would be entitled to carry with them, aggregationally, such additional terms and conditions of service as may be available to them, in each borrowing organization, over and above their entitlements in the public services where they hold posts on a permanent, or substantive basis. The consequences of this would not only be chaotic, and lend avoidable subjectivity to terms and conditions of service of such officials, but it would undermine the efficacy of public service, impelling officials in the Central Government, to scramble for such highly prized deputations. I am therefore, of the opinion that the petitioner cannot claim the benefit of free air passage, as he is disentitled to it in terms of the language of the resolution, and the Presidential directive; he is also not entitled to it, as a matter of law, being a deputationist whose terms and conditions of deputation were known, and settled as per rules.

30. The above observations ought to have been dispositive of the issues raised in these proceedings. However, the Board resolution dated 30th November 1996 and the Presidential directive, in my opinion, have created a disturbing entitlement which perhaps may not stand the test of scrutiny under Article 14 of the Constitution of India. The arguments advanced by the parties, and the record of Board resolutions indicate that the "free air passage" is granted to some persons, determined as entitled or eligible, on "as required" basis - apparently a euphemism for unlimited facilities. The chart filed by the IA paints a disconcerting picture; four persons, during the last 5 years were granted 53 requests for free air passes, and 55 requests for substantial (95%) concession passes.

31. Both Indian Airlines, and Air India, are state owned, state controlled, commercial organizations, meant to be managed on efficient basis, on commercial lines. In a democratic polity governed by a written Constitution, and the rule of law, the Government, or any institution, charged with the duty to manage public resources and properties, acts as a custodian, or a trustee, to ensure the greatest good of the public weal. In Ramana Dayaram Shetty v. International Airports Authority of India , the Supreme Court held as follows:

The power of giving licenses means power to withhold them and this gives control to the Government or to the agents of Government on the lives of many people. Many individuals and many more businesses enjoy largesse in the form of Government contracts. These contracts often resemble subsidies. It is virtually impossible to lose money on them and many enterprises are set up primarily to do business with Government. Government owns and controls hundreds of acres of public land valuable for mining and other purposes. These resources are available for utilisation by private corporations and individuals by way of lease or license. All these mean growth in the Government largesse and with the increasing magnitude and range of governmental functions as we move closer to a welfare State, more and more of our wealth consists of these new forms. Some of these forms of wealth may be in the nature of legal rights but the large majority of them are in the nature of privileges. But on that account, can it be said that they do not enjoy any legal protection ? Can they be regarded as gratuity furnished by the State so that the State may withhold, grant or revoke it at its pleasure ? Is the position of the Government in this respect the same as that of a private giver ? We do not think so. The law has not been slow to recognise the importance of this new kind of wealth and the need to protect individual interest in it and with that end in view, it has developed new forms of protection. Some interests in Government largesse, formerly regarded as privileges, have been recognised as rights while others have been given legal protection not only by forging procedural safeguards but also by confining/structuring and checking Government discretion in the matter of grant of such largesse. The discretion of the Government has been held to be not unlimited in that the Government cannot give or withhold largesse in its arbitrary discretion or at its sweet will. It is insisted, as pointed out by Prof. Reich in an especially stimulating article on "The New Property" in 73 Yale Law Journal 733, "that Government action be based on standards that are not arbitrary or unauthorised." The Government cannot be permitted to say that it will give jobs or enter into contracts or issue quotas or licenses only in favor of those having grey hair or belonging to a particular political party or professing a particular religious faith. The Government is still the Government when it acts in the matter of granting largesse and it cannot act arbitrarily. It does not stand in the same position as a private individual.

12. We agree with the observations of Mathew, J., in V. Punnan Thomas v. State of Kerala that:

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.'

32. In Ram & Shyam Company v. State of Haryana , dealing with the question of disposal of State property,the court said:

Let us put into focus the clearly demarcated approach that distinguishes the use and disposal of private property and socialist property. owner of private property may deal with it in any manner he likes without causing injury to anyone else. But the socialist or if that word is jarring to some, the community or further public property has to be dealt with for public purpose and in public interest. The marked difference lies in this that while the owner of private property may have a number of considerations which may permit him to dispose of his property for a song. On the other hand, disposal of public property partakes the character of a trust in that in its disposal there should be nothing hanky panky and that it must be done at the best price so that larger revenue coming into the coffers of the State administration would serve public purpose viz. the welfare State may be able to expand its beneficent activities by the availability of larger funds.

The Supreme Court spoke in a similar vein in Secretary Jaipur Development Authority v. Daulat Mat Jain , where it was held as follows:

The Government acts through its bureaucrats, who shape its social economic and administrative policies to further the social stability and progress socially, economi­cally and politically. Actions of the Government, should be accounted for social mo­rality. Therefore, the actions of the individuals would reflect on the actions of the Government. The actions are intended to further the goals set down in the Constitution, the laws or administrative policy. The action would, therefore, bear necessary integral connection between the 'purpose' and the end object of public welfare and not personal gain. The action cannot be divorced from that of the individual actor. The end is something aimed at and only individuals can have and shape the aims to further the social economic and political goals.

33. The issues which arose for consideration here, threw up startling facts which show that the respondents are permitting free air passage facilities, seemingly without any cap, " on request" basis. Whilst reward for loyal service, on the basis of bonus, ex-gratia, or incentives cannot be faulted, the treatment of public resources, to wit, air passages, as largesse-exactly what has happened, in an unregulated manner, would offend Article 14 of the Constitution of India. At a time when oil prices are spiraling, (and the world faces a grave energy crisis, which has constantly led all societies to rethink and revise tariffs in all modes of transport), the extension of such unlimited and unregulated "air passage" facility even to a section of the people, howsoever eminent they might be, and howsoever loyal their services might have been, in a developing country that can ill afford it, has to be reviewed. These issues do not directly arise consideration in the present proceedings; nevertheless, since the equitable jurisdiction of this Court has been invoked, and also since the Central Government, and the Indian Airlines are parties, I deem it appropriate to require the said respondents to review the entire issue of "free air passages" and take suitable remedial action.

34. In view of the foregoing reasons, the writ petition is devoid of merit; it is accordingly dismissed, with no order as to costs.