BALCO Employees Union v. Union of India
India Supreme Court
[2001] INSC 646 (2001)

- Written by Miller Jozwiak, JD
Facts
In 1965, the government of India (defendant) incorporated Bharat Aluminium Company Ltd. (BALCO) as an entity to manufacture aluminum. In the 1990s, the government began to implement a policy of disinvesting from public-sector holdings in favor of privatization. The government decided that such disinvestment was necessary for three primary reasons: (1) return on investment was generally low for government-run industries like aluminum production; (2) the government did not have the resources to sustain organizations that could not compete in the market; and (3) the work culture of government-run enterprises would not change, notwithstanding repeated efforts. In 1997, a report recommended the privatization of BALCO. The government sought private actors to bid for the entity and eventually approved a 51 percent equity sale of BALCO to a private entity. The agreement provided certain protections for workers in the event of layoffs. In response, the BALCO Employees Union (plaintiff) challenged the sale. The union filed a petition for a writ concluding that the sale was invalid.
Rule of Law
Issue
Holding and Reasoning (Kirpal, J.)
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