Case: Mrinmayee Rohit Umrotkar Vs. Union of India and 4 Others

2. The petitioner, desirous of becoming a doctor, had participated in the NEET-2020. The Information Brochure for NEET-2020 provides that a candidate aspiring for admission in the MBBS course in the 85% State quota, reserved for Maharashtra candidates, is required to be a domicile of Maharashtra apart from having passed the 10th standard S.S.C. or equivalent examination and the 12th standard H.S.C. or equivalent examination from schools in Maharashtra. Admittedly, the petitioner is a domicile of Maharashtra and passed the 10th standard S.S.C. examination from a school in Maharashtra; however, she cleared the 12th standard H.S.C. examination after pursuing studies in the 11th and the 12th standards in a school in Telangana while residing with her father. Incidentally, the petitioners father is an employee of IDBI Limited who was posted in Telangana at the relevant point of time and has since been transferred and posted in Maharashtra with effect from November 19, 2020.3. In support of the contention that IDBI Limited, in fact, is a Government of India undertaking, Shri Bapat, learned advocate appearing for the petitioner had on November 25, 2020 (when we considered the writ petition for the first time), placed heavy reliance on letters dated December 31, 2007 and December 17, 2019 of the Ministry of Finance, Government of India. The first of the aforesaid two letters conveyed to the Secretaries of all Ministries and/or departments of the Government of India the decision of the Ministry of Finance to treat IDBI Limited on par with Nationalized Banks/State Bank of India by Government Departments/Public Sector Undertakings/other entities for all purpose, including deposits/bonds/investments/guarantees etc. and Government business. By the other letter, which is of recent origin, the Ministry of Finance conveyed to the addressees that pursuant to the acquisition of stake in IDBI Limited by the Life Insurance Corporation of India (hereafter LICI, for short) to the extent of 51% of the share capital, and keeping in view the fact that LICI is wholly owned by the Government of India and also that the Government of Indias holding in IDBI is 46.46%, the direct and indirect Government holding in IDBI is 97.46%; hence, the Central/State Government/departments/agencies/ institutions may continue to consider IDBI Limited for grant of Government business.4. On the aforesaid date, i.e., November 25, 2020, Shri Rodriques, learned advocate representing the respondent no.4, i.e., Competent Authority & Commissioner, State Common Entrance Cell, Government of Maharashtra, had brought to our notice a letter dated March 14, 2019 of the Reserve Bank of India (hereafter RBI, for short), whereby RBI categorized IDBI Limited as a „Private Sector Bank and contended that IDBI Limited cannot be regarded as an undertaking of the Government of India.5. In view of such letter, we required the assistance of Shri Anil Singh, learned Additional Solicitor General. He was requested to apprise us of the status of IDBI Limited in the light of the letters dated December 17, 2019 and March 14, 2019, referred to above. While adjourning hearing, we had directed that until further orders, one seat in the medical course may not be allotted to anybody.

Reasoning:
16. The Industrial Development Bank (Transfer of Undertaking and Repeal) Act, 2003 (hereafter the 2003 Act, for short) was enacted by the Parliament to provide for transfer and vesting of undertaking of the Development Bank to and in the Company to be formed and registered as a Company under the Companies Act, 1956 (hereafter the 1956 Act, for short) to carry on banking business and for matters connected therewith or incidental thereto and also to repeal the IDBI Act. Section 3 of the 2003 Act provides that on and from the date the Central Government may, by notification, appoint, the undertaking of the Development Bank shall be transferred to, and vest in, the Company, meaning thereby the Industrial Development Bank of India Limited to be formed and registered under the 1956 Act. We find that from October 1, 2004, the undertaking of the Development Bank stood transferred to, and vested in, the Company in terms of Section 3(1) of the 2003 Act.17. Section 5 of the 2003 Act contains provisions in respect of officers and other employees of IDBI Limited. Sub- section (1) thereof provides that every officer or other employee of the Development Bank (except a director of the Board or the chairman and managing director or any whole-time director) serving in the employment immediately before the appointed day shall, insofar as such officer or other employee is employed in connection with the undertaking which has vested in the Company by virtue of such Act, become, as from the appointed day, an officer or, as the case may be, other employee of the Company and shall hold his office or service therein by the same tenure, at the same remuneration, upon the same terms and conditions, with the same obligations and with the same rights and privileges in respect of matters mentioned therein and other benefits as he would have held under the Development Bank if its undertaking had not vested in the Company.18. In our considered view, section 5 of the 2003 Act is crucial and clinches the issue against the petitioner and for the respondents. Perusal of the 2003 Act clearly reveals cessation of the Development Bank as a body corporate which, by operation of the said Act, would stand transferred to and vested in the Company to be formed and registered under the 1956 Act. The Development Bank, from a body corporate, by reason of the 2003 Act (which also repealed the IDBI Act) attained an identity of a Company governed by the 1956 Act.19. Though „undertaking is a word of large import, it has to be read and understood in the context where it occurs. In the present context, a Government of India undertaking would mean an undertaking run by the Government of India, that is to say, it belongs to the Government of India. We regret to record, it has not been so shown that IDBI Limited belongs to the Government of India and is run by it. The transition of the Development Bank from a body corporate to a Company (IDBI Limited) without deep and pervasive administrative, financial and functional control of the Government of India over such Company having been shown gives us little reason to hold that after the enactment of the 2003 Act, IDBI Limited could still be regarded as an undertaking of the Government of India. We place on record that Shri Bapat has not referred to any authority which lays down the test for identifying an entity as an undertaking of the Government of India and, hence, we have proceeded to decide the issue formulated at the beginning of the judgment based on our reading of the IDBI Act and the 2003 Act and our understanding of the meaning of the word „undertaking referred to above.20. Submission of Shri Bapat that the CVC Act has been made applicable to IDBI Limited and that the Ministry of Corporate affairs having recorded IDBI Limited as a non- banking Company and, therefore, IDBI Limited ought to be regarded as an undertaking of the Government of India, has failed to impress us. The vigilance control over IDBI Limited by the Central Vigilance Commission cannot be the guiding factor for exploring the answer to the issue which we are primarily tasked to decide. On this writ petition, we are not called upon to decide whether exercise of vigilance control over IDBI Limited by the Central Vigilance Commission is legal and valid. Such a question can be dealt with in an appropriate proceeding, if the occasion therefor arises. Further, nothing substantial turns on holding of 51% share capital in IDBI Limited by LICI. By reason of the definition in section 2(45) of the Companies Act, 2013, IDBI Limited is not a Government company. LICI could be a „State as defined in Article 12 of the Constitution but by reason thereof, it does not necessarily follow that IDBI Limited would attain the status of State within the meaning of Article 12. Also, reliance placed by the petitioner on the data maintained by the Ministry of Corporate Affairs on the Company (IDBI Limited) as per the requirement of the 1956 Act or the Companies Act, 2013 cannot be accepted as sacrosanct for ruling in favour of the petitioner having regard to the clear provisions of the applicable statutory enactments, as noted above.