Judgment

CHINNAPPA REDDY, J.:- The old question "what is compensation" is back again. Fortunately, Constitutional Amendments and Judicial precedents have narrowed the scope for controversy. The question has arisen this way:

2. The appellant (sic) (Petitioner) the Oriental Gas Company Ltd. was originally constituted in England by a deed of settlement in April 1853, as the Oriental Gas Company for the purpose of manufacture, supply, distribution and sale of fuel gas in Calcutta. It was later incorporated in accordance with the provisions of the English Joint Stock Companies Act, 1862. By a subsequent arrangement the control and management of the Company passed from British into Indian hands. Over the course of the years the Company acquired extensive properties and became the owner of large plants, machinery, buildings, lands, pipelines, stores etc. The total market value of the appellants (sic) (Petitioner?) industrial undertaking was estimated by the appellant (sic) (Petitioner?) as on 22nd March, 1962, at Rs. 7,00,00,000. In 1958, the Government of West Bengal, being of the view that the Company which enjoyed a monopoly in the supply of Gas in Calcutta was negligent in looking after the interest of the consumers, appointed a Committee to inquire into the unsatisfactory condition of supply of gas in Calcutta and to suggest remedial measures including valuation of the undertaking for the purpose of taking over the gas supply undertaking. The Members of the Committee were: the Chief Secretary, the Sheriff of Calcutta, the Secretary, Commerce and Industries Department, the Administrator, Durgapur Project and the Director, Central Fuel Research Institute. The Committee was assisted by several experts. The Committee reported that the present Gas Works in Calcutta including the distributing system was in a bad state of disrepair and a very poor state of maintenance. The Committee recommended that the Gas Works and the distribution system should be taken over immediately under the management of the State Government in order to ensure and maintain the supply of gas to the consumers in Calcutta. After the report of the Committee was received by the Government of West Bengal, the West Bengal Legislature enacted the Oriental Gas Company Act (West Bengal Act XV of 1960) providing for the taking over for a limited period, of the management and control and the subsequent acquisition of the undertaking of the Oriental Gas Co. Ltd. The undertaking of the Company was defined to mean "the properties of the company, movable or immovable other than cash balances and reserve funds but including works, workshops, plants, machineries, furniture, equipments and stores, and lands appertaining thereto, actually in use immediately before the commencement of this Act, or intended to be used, in connection with the production of gas or supply thereof in Calcutta and its environs;". Section 3 of the Act provided for the taking over of the management and control of the undertaking of the Company for a period of five years from the date specified in a notification to be issued. Section 7 provided for the acquisition of the undertaking of the Company at any time within the period of the said five years. Section 8 (1) (a) provided for the payment of annual compensation during the period of the takeover of the management and control of the undertaking of the Company. Section 8 (1) (b) provided for the compensation payable for the acquisition of the undertaking of the Company. In the present appeal (sic) (Petition?) we are concerned with the compensation payable for the acquisition of the undertaking of the Company, that is, we are concerned with S. 8 (1) (b) only. Section 8 (1) (b) as originally enacted was as follows :

"8 (1) (b) in the case of acquisition of the undertaking of the company, the total compensation payable shall be,- a sum representing the purchase price of the undertaking of the company reduced by such depreciation as may be allowed by the Tribuna