Central Government Is the ‘Appropriate Government’ for BMRCL Due to Pervasive Administrative Control | HC

Case Details: Bangalore Metro Rail Corporation Ltd., Employees Union (REGD.) vs. Bangalore Metro Rail Corporation Ltd. [2025] 180 taxmann.com 356 (Karnataka-H.C)

Judiciary and Counsel Details

• Anant Ramanath Hegde, J.
• P.S. Rajagopal, Sr. Adv. & Smt Ashwini Rajagopal, Adv. for the Petitioner.
• S. Santhosh Narayan, Adv., M.N. Kumar, CGC, Santhosh Gogi, AAG & Manjunath B., AGA for the Respondent.

Facts of the Case

In the instant case the Bangalore Metro Rail Corporation Ltd. (BMRCL) was a Company registered under the Companies Act, 1956. The BMRCL operated a metro rail network in Bengaluru. The Said metro rail was popularly known as ‘Namma Metro’ meaning thereby Our Metro.

The BMRCL is a joint venture of the Government of India and the Government of Karnataka, each having 50 per cent stake in the BMRCL. The BMRCL was meant exhaustively for implementation of metro rail project in Bengaluru. It was noted that final say in key administrative actions of the BMRCL was that of the Central Government and the State Government had to take approvals or concurrence from the Central Government in certain crucial administrative decisions.

The BMRCL Employees Union (Union) claimed that the Central Government was the ‘appropriate Government’. The BMRCL and State contended that the State Government was the ‘appropriate government’.

In this batch of petitions, questions that needed to be resolved were: (i) which was the ‘appropriate government’ for the BMRCL in relation to any of the Industrial Dispute? (ii) Whether the State Government under section 2(n)(vi) of the Industrial Disputes Act, 1947 could notify the services of the BMRCL as ‘Public utility service’? (iii) Whether the State Government under section 2(l) of the Karnataka Essential Services Maintenance Act, 2013, could notify the services of the BMRCL as essential service?

High Court Held

The High Court held that BMRCL, despite being a joint venture, was predominantly controlled by the Central Government. The Central Government had the final say in crucial administrative decisions, while the State Government had to seek approval from the Central Government for key actions. As a result, the court held that the Central Government was the “appropriate government” for BMRCL.

Further, under Section 2(n) of the Industrial Disputes Act, the “appropriate government” has the authority to notify industries as a public utility service. Since the Central Government was found to be the appropriate government for BMRCL, the State Government did not have the jurisdiction to declare BMRCL’s services as a public utility service. Consequently, the notification issued by the State Government to this effect was declared invalid and quashed by the court.

Lastly, the Karnataka Essential Services Maintenance Act, 2013, empowers the State Government to declare certain services as essential, but only for services within the scope of List II of the Seventh Schedule of the Indian Constitution. Since railways (including metro rail) are not part of List II, the court concluded that the State Government lacked the authority to issue a notification declaring BMRCL services as essential under the Karnataka Act. Thus, both the State Government’s notification under the Industrial Disputes Act and under the Karnataka Essential Services Maintenance Act were quashed.

List of Cases Reviewed

• Ram Sarup v. Munshi AIR 1963 SC 553 (para 33) followed
• Logwell Forge Ltd. v. Bengaluru Metro Rail Corporation Limited ILR 2010 Kar 87/Writ Petition No. 16187/2009 (para 75)
• CMRL Employees Union v. Ministry of Housing and Urban Affairs [WP.No.12931 of 2019] (para 76) distinguished

List of Cases Referred to

• Logwell Forge Ltd. v. Bengaluru Metro Rail Corporation Limited ILR 2010 Kar 87 (para 15)
• CMRL Employees Union v. Ministry of Housing and Urban Affairs [WP.No. 12931 of 2019] (para 15)
• Ram Sarup v. Munshi AIR 1963 SC 553 (para 33)
• Samuel Sathyasheelan v. Union of India [W.P. No.48094 of 2012] (para 72)
• Life Insurance Corporation of India v. D.J Bahadur 1980 taxmann.com 1256 (SC) (para 76).