Case Note & Summary
The present writ petition was filed by the Bihar State Ardh Sarkari Arajpati Karamchari Maha Sangh and others, representing thousands of employees of five State-owned corporations of Bihar: Bihar State Construction Corporation Ltd., Bihar State Industrial Development Corporation Ltd., Bihar State Electronic Development Corporation Ltd., Bihar State Forest Development Corporation Ltd., and Bihar State Panchayati Raj Financial Corporation Ltd. Following the bifurcation of the erstwhile State of Bihar under the Bihar Reorganisation Act, 2000, the assets and liabilities of these corporations were required to be apportioned between the successor States of Bihar and Jharkhand. However, the process of bifurcation and settlement of liabilities remained unresolved for nearly two and a half decades, resulting in the prolonged non-payment of salaries, retiral dues, and other emoluments to the employees. The material placed before the Supreme Court revealed grave humanitarian consequences, including reported instances of suicides and starvation deaths among affected employees and their families due to the denial of lawful wages. The Court observed that the dispute had ceased to be a mere matter of financial adjustment between two States and had assumed the character of a significant human rights and constitutional concern, directly implicating the right to livelihood and dignity guaranteed under Article 21 of the Constitution of India. The Court heard the matter in part and issued directions to the States to address the crisis.
Headnote
A) Constitutional Law - Right to Livelihood - Article 21 of the Constitution of India - Prolonged non-payment of salaries and retiral dues to employees of State-owned corporations following State bifurcation - The Supreme Court held that the continued denial of lawful wages and retiral benefits for nearly two and a half decades constitutes a grave violation of the right to livelihood and dignity under Article 21, and directed the successor States to immediately disburse the outstanding amounts. (Paras 2-3) B) Interpretation of Statutes - Bihar Reorganisation Act, 2000 - Apportionment of assets and liabilities - The Court noted that the statutory scheme under the Act required the successor States to apportion the assets and liabilities of the corporations, but the process remained unresolved, leading to the humanitarian crisis. (Para 2) C) Service Law - Payment of salaries and retiral dues - State-owned corporations - The Court emphasized that employees cannot be made to suffer due to inter-State financial disputes and directed the States to ensure payment of all outstanding dues. (Paras 2-3)
Issue of Consideration
Whether the prolonged non-payment of salaries, retiral dues, and other emoluments to employees of five State-owned corporations following the bifurcation of Bihar under the Bihar Reorganisation Act, 2000, violates the fundamental right to livelihood under Article 21 of the Constitution of India, and what directions should be issued to the successor States of Bihar and Jharkhand to resolve the humanitarian crisis.
Final Decision
The Supreme Court heard the matter in part and issued directions to the States of Bihar and Jharkhand to immediately disburse the outstanding salaries, retiral dues, and other emoluments to the employees of the five corporations, recognizing the violation of the right to livelihood under Article 21.
Law Points
- Right to livelihood under Article 21 of the Constitution of India
- Obligation of successor States to apportion liabilities under the Bihar Reorganisation Act
- 2000
- Humanitarian considerations in inter-state financial disputes
