IMPORTANT POINT
Writ petitions challenging validity of Bihar Act No. 38 of 1985 and XIII of 1977 are liable to be dismissed inasmuch as all the contentions of the petitioners are rejected.

Headnote:(i) Constitution of India-Article 32-Writ petition challenging Bihar Ordinance No. 38 of 1985 replaced by Act XII of 1985-Whether beyond the Legislative competence of State of Bihar? (No) (see para 11)-Whether decision in Synthetics and Chemicals Ltd. case, 1990(1) SCC 109 overrules decision in Ishwari Khetan s case, 1980(4) SCC 136? (No) (see para 13)-Whether takeover of the distillery is bad? (No) (see para 13)-Whether valuation of the sugar undertaking on the basis of book value is unreasonable? (No) (Para 21)-Petition dismissed.
       (ii) Constitution of India-Article 32 -Writ Petition challenging take-over of distillery of Petitioner under Bihar Act (XIII of 1977)-Contention that the Act has no application to the distillery of the petitioner-Whether correct? (No) (see para 28)-Contention that retrospective operation of Section 4(4)(ii)(e) of the Act is bad-Whether can be sustained? (No) (see para 36)-Result-Writ Petition dismissed. (Para 37)
       (iii) Bihar Act XII of 1985 and XIII of 1977-Transfer application have become infructuous (see para 38)-Notice for contempt dropped (see para 39)-SLP No. 7887/84 ordered to be delinked from the present batch of cases (see para 40)-Order accordingly.

JUDGMENT

Rajendra Babu J.-W.P.[C] Nos. 12598/85, 1600/86, 1487/86 & 1260/86

The Bihar Sugar undertakings [Acquisition] Act, 1976 [Bihar Act XIII of 1977] [hereinafter referred to as the Act ] was passed by the State Legislature and received the assent of the President on June 4, 1977 and was published in the Gazette on June 30, 1977. The Act was to provide for acquisition and transfer of certain sugar undertakings in the State of Bihar and for matters connected therewith or incidental thereto. Under Section 3 of the Act, the undertakings listed in the Schedule stood transferred to and vested in the Government of Bihar or a Corporation with all the assets, liabilities, rights, titles, interest and obligation including any mortgage, charge of other encumbrance or lien trust of similar obligations attaching to the undertaking. Under Section 2(h) of the Act schedule undertaking is defined to mean an undertaking engaged in the manufacture or production of sugar by means of vacuum pans and with the aid of mechanical power in a factory specified in the schedule and comprises of several items as set out therein.

2. The undertakings mentioned in the Schedule are eight in number. Under Section 17 of the Act, the State Government was authorised to add other sugar undertakings to be included in the Schedule by notification.

3. On 29.10.1978, a notification was issued under Section 17 of the Act to include 16 more sugar undertakings including the three sugar mills of the petitioners in the Schedule to the Act.

4. Several writ petitions were filed in the Calcutta High Court challenging the notification issued under Section 17 of the Act which included the petitioners sugar mills thereunder. Interim stay was granted restraining possession being taken over on 31.10.1978. On 12.7.1979, the writ petitions were heard together and were allowed and the Act as well as the notification under Section 17 of the Act were declared ultra vires and the take-overs were quashed. On 28.10.1979, the State Government preferred appeals to the Division Bench of the High Court. In the pending appeals, the Petitioners sought leave to withdraw their writ petition C.R.No.784 of 1978 and the Division Bench dismissed the writ petition as withdrawn and set aside the judgment under appeal so far as the petitioners therein were concerned. On 5.7.1983, the distillery at Hathua was sold by the petitioners to United Distilleries (P) Ltd. The petitioners, on 21.9.1984, requested the respondents to take over possession of the three sugar mills. Thereafter a notification was issued by the State Government on 29.9.1984 purporting to withdraw the notification dated 29.10.1978 to the extent it related to the three sugar mills of the petitioners stating that this notification was issued pursuant to the order of the Division Bench of the High Court dated 18.9.1984. Writ petitions were filed in the Calcutta High Court challenging the notification dated 29.9.1984 proposing to withdraw the acquisition. The High Court granted stay of the operation. Workers of the petitioners also filed writ petition in the Patna High Court challenging the notification dated 29.9.1984. Subsequently this Court transferred the writ petitions from the Calcutta and the Patna High Courts to this Court by an order made on 11.2.1985.

5. In the meanwhile, an Ordinance was issued by the Bihar Government so as to acquire the sugar mills of the petitioners. Writ petition was filed before this Court challenging the Ordinance. Now, the Ordinance is replaced by Act 12 of 1985 and that the Act is also under challenge before us.

6. On behalf of the petitioners, five major contentions have been urged :

1. That the impugned enactment is beyond the legislative commence of the State of Bihar since the industries covered by the enactment fall under Entry 52 of List I to the Seventh Schedule to the Constitution;

2. That the decision in Ishwari Khetan Sugar Mills (P) Ltd. & Ors. vs. State of U

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2003 Supreme(SC) 200

IMPORTANT POINTWrit petitions challenging validity of Bihar Act No. 38 of 1985 and XIII of 1977 are liable to be dismissed inasmuch as all the contentions of the petitioners are rejected.

Cases Referred (13)

IMPORTANT POINT
Writ petitions challenging validity of Bihar Act No. 38 of 1985 and XIII of 1977 are liable to be dismissed inasmuch as all the contentions of the petitioners are rejected.