State and Contracts

Acknowledgement
The images/ video clips in the presentation are
drawn from different internet sites for the purposes
of classroom instruction.

The references to the sources are at the end of the

presentation.
 Every society has a
governing mechanism.

Without it, there would be chaos

and social life impossible.
 Constitutions provide
the governing mechanism.

This is in creating mechanism

for law making and rule of law.
 Most countries,
whether democracies or not,
have a written constitutions.
France
The Constitution of India constitutes India as a
sovereign democratic republic.
It was adopted by the Constituent Assemble on
January 26, 1950.
 Centre and States
The Constitution of India constitutes two tiers of
governing mechanism, centre and the states.
Parliament is the legislative body at the Centre
It legislates Acts
The central government enforces the law
made by the Parliament.
Railways is a part of the central government,
so are the post offices
 A parallel system is
created in the States.
Maharashtra Legislative
Assembly
Maharashtra Mantralaya
 Fundamental Rights
The chapter on Fundamental Rights in the
Constitution of India guarantee certain rights to
individuals against the state.
 Fundamental Rights
Article 12 defines the State.

Article 14 to Article 30 list the several rights of

equality and freedom.

Article 13- Any law which violates Fundamental

Rights is void.

Article 32- An individual can go directly to the

Supreme Court for a claim against infringement of
the Fundamental Rights.
 Article 12: State
Article 12 states— ...‘the State’ includes:

the Parliament of India

Central Government
State Legislatures
State Government
Local Bodies
Other authorities (bodies controlled by the
government or extension of the government)
 Article 13
Article 13 declares that any law made by the State,
which takes away or abridges the Fundamental
Rights, is to be void.

Law includes acts, rules, notifications, ordinances,

government orders, regulations and bye-laws.
 Article 14: Right to Equality
The State shall not deny to any person, equality
before the law or the equal protection of the laws
within the territory of India.
The law will make classes of people and treat them
differently.

Is the basis for making the classes based on rational

principles (in general and in relation to the objectives
of the law) or arbitrary and discriminatory?

If it is arbitrary and discriminatory, right to equality

has been violated.
 Principle
1. Identify the classes which have been created.

2. Explore whether the basis for making the classes

is rational or arbitrary and discriminatory.
 Illustration
Law: Garment shops to close by 9 PM; and
electronic goods shop by 11 PM.

Classes: Owners of garment shops

Owners of electronic shops

A law stipulating closing down time has several

purposes including not having people on the streets
at night. There is no basis for requiring one to close
at 9 PM and the other at 11 PM. This is violation of
the right of equality.
 Illustration
The state makes a law that shops selling garments
will close by 9 PM and restaurants and food joints
11 PM.

The law makes two classes and treats them

differently. However, there is a rational basis.
Restaurants and food joints meet the necessity of
food for the people who are out in the city late in the
evening.
The state makes a law that only men who are more
than 5 feet 6 inches would be eligible for admission
to MBA programmes.

Classes:
Men taller than 5 feet 6 inches
Men shorter than 5 feet 6 inches and all women

There is no relationship between height and

studying business management or the functions a
manager has to perform. Therefore, the basis for
making the classification is arbitrary. The law is
violative of Article 14.
The state makes a law that only men who are more
than 5 feet 6 inches would be eligible for admission
to MBA
Indianprogrammes.
Military Academy.

Classes:
Men taller than 5 feet 6 inches
Men shorter than 5 feet 6 inches and all women

The making of the two classes in this case has

a rational basis and is not arbitrary.
Further contrast with this: The state makes a law that
only men who are more than 6 feet tall would be
eligible for admission to the Indian Military Academy.

The two classes now are men more than 6 feet tall
and others. While height would be a criterion for
suitability for military, setting the bar at the extreme
end would exclude most of the men. This will make it
discriminatory.
Exercise 1
1 Delhi University Other Authorities
2 Election Commission Other Authorities
3 SEBI Other Authorities
4 Nirma University Not State
5 Reserve Bank of India Other Authorities
6 Reliance Industries Not State
7 Ministry of Railways Central
Government
8 Collector’s office in State Government
Gujarat
9 New Delhi Municipal Local Body
Corporation
10 Income Tax Department Central
Government
11 Forest Department of State Government
Gujarat
12 Legislature of Orrisa State Ligislature
13 Tata Motors Limited Not State
14 Life Insurance Other Authority
Corporation (LIC)
15 State Bank of India (SBI) Other Authority
Exercise 2
Q. No
1 Rational
2 Discriminatory (70% very high for graduation)
3 Discriminatory
4 Rational
5 discriminatory
6 Rational
7 discriminatory
8 discriminatory
9 Rational
Q. No
10 discriminatory
11 discriminatory
12 discriminatory
13 Rational
14 discriminatory
Q1

Not violative of the right of equality.

A cut of 20 crores turn over is reasonable to do a

business worth 100 crores.
Q 2, 4 and 5

The companies are controlled by private individuals.

Fundamental Rights does not apply to them.
Q 3.

Not violative of equality.

Q 6.

There is discrimination of the public sector.

Q 7.

Violative of the right of equality.

Features and configuration and not the brand name

can be the distinguishing features of the goods and
the vendors of the goods.
End
A