Back
2011 (1) SCC 640
IN THE SUPREME COURT OF INDIA
Markandey Katju,Gyan Sudha Misra, JJ.
M/s. Bajaj Hindustan Ltd.-Appellant(s)
versus-
Sir Shadi Lal Enterprises Ltd. & Anr.- Respondent(s)
CIVIL APPEAL NO.5856 of 2005
SLP ) No.1398 of 2006, Civil Appeal No.5857 of 2005,Civil Appeal No.5858 of 2005
Decided on : November 29, 2010.
(2007) 4 SCC 723; (2002) 2 SCC 333; (1997) 7 SCC 592; (2001) 3 SCC 635; (2000) 5 SCC 471; (2000) 8 SCC 262; (1996) 5 SCC 268 – Relied upon
2006 (86) DRJ 593 – Referred
(b) Industries (Development and Regulation) Act, 1951 – Section 29B – Power to executive to grant exemption to certain industries – Essential legislative policy clearly specifying grounds for exemption – Delegation of power not excessive. (Para 27)
(1962) 2 SCR 169; (1972) 4 SCC 485; (1996) 3 SCC 741; (1998) 1 SCC 318; (2000) 7 SCC 425; (2000) 7 SCC 425; (2001) 5 SCC 212 – Relied upon
(c) Industries (Development and Regulation) Act, 1951 – Section 29B r/w Article 73(1), Constitution of India – High Court holding that power of de-licensing is available only to legislature – Executive power of Union of India co-extensive with the legislative power – Hence notification issued u/s 29B not invalid. (Para 29, 33)
(d) Industries (Development and Regulation) Act, 1951 – Section 29B – Notification u/s 29B not required to be approved by Parliament – It is for Government to decide whether notification is in public interest – Licensing or de-licensing is for the executive authorities to decide. (Para 34)
(e) Industries (Development and Regulation) Act, 1951 – Section 29B – Grounds for exemption – Includes `the stage of development of any scheduled industry’ – Of wide import – Large industries can also be exempted. (Para 34)
285 U.S. 262 (1932) – Relied upon
(f) Administration of Justice – Judicial review – Interference by Court – Some people adversely affected and suffering loss due to notification – No ground for interference by Court – Court should not ordinarily interfere in policy decisions. (Para 37, 38, 39)
AIR 1990 SC 1277; AIR 1991 SC 724; (1949) 338 US 604 (617): 94 Law Ed. 381; AIR 1978 SC 1296; (1990) 3 SCC 223; JT (2008) 3 SC 221 – Relied upon
Facts of the case:
Government of India issued Press Note 12 dated 31.8.1998 de-licensing the sugar industry, subject to the condition that there would be a minimum of 15 km distance between two sugar mills. The Press Note was then followed by the formal notification on 11.9.1998, issued under Section 29B(1) of the Industries (Development and Regulation) Act, 1951.
The High Court of Allahabad quashed the notification on 24.08.05.
The High Court of Delhi in the case Ojas Industries P. Ltd. v. Union of India, 2006 (86) DRJ 593 upheld the validity of the Press Note dated 31.08.98 being a policy of the Government of India under Article 73 of the COI. Thus Delhi High court upheld the validity of the Press Note dated 31.08.98 which was quashed by the Allahabad HC on 24.08.05.
Delhi High Court pointed out certain defects which were removed by amendment of the Sugarcane Control Oder in 2006. This amendment was clarificatory in nature and retrospective in operation and applied to all cases pending in various courts, as held in Ojas Industries P. Ltd. v. Oudh Sugar Mills Ltd., (2007) 4 SCC 723.
Finding of the Court:
The impugned Press Note and Notification were validly issued under Section 29B of the Act. The impugned judgment cannot be sustained.
Result:
SLP No.1398 of 2006 dismissed as withdrawn.
Civil Appeal No.5856 of 2005 dismissed.
Civil Appeal Nos. 5857/2005 & 5858/2005 disposed of.
JUDGMENT
SLP ) No.1398 of 2006
1. As prayed by learned counsel Mr. Parijat Sinha this petition is dismissed as withdrawn.
Civil Appeal No.5856 of 2005
2. These petitions have been filed against the judgment and order dated 24.08.2005 in Civil Misc. Writ Petition No.36685 of 2004 of the High Court of Judicature at Allahabad
3. By that decision the High Court has quashed the Press Note Number 12 dated 31.8.1998 and Notification SO 808(E) dated 11.9.1998, issued by the Central Government, by which the Sugar Industry was de-licensed under Section 29B of the Industries (Development and Regulation) Act, 1951 (hereinafter referred to as `the Act'.) As a consequence, the High Court has debarred the respondent number 6 from establishing a sugar industry without obtaining a licence under Section 11 of the Act. The High Court has also cancelled the permission, if any, granted to the respondent number 5 to 6 for purchasing and/or acquiring land for the purposed of establishing new sugar industries without licence.
4. It is submitted by learned counsel for the appellant that the effect of the impugned judgment and order quashing of the Notification dated 11.9.1998 and the Press Note dated 31.8.1998 is that the sugar industry in India has virtually been thrown back into the era of `License Raj', nullifying the efforts of the Government of India to open up the economy to prospective investors. Also, all the sugar industries established throughout India after 11.9.1998 (as per the available data they are 100 in number) have become illegal. Industrial development, particularly in the sugar producing States, may well come to a grinding halt. An investment of about Rs.4000 crores in the sugar industry in U.P. alone has been jeopardized. The petitioner herein alone has invested about Rs.600 crores in the sugar industry in the State of U.P. after the said Notification and Press note were issued. Further, the petitioner has committed an investment of an amount of Rs.700 crores in the sugar industry in U.P.
5. It is submitted that lacs of farmers throughout India and particularly in the State of U.P. will suffer as they would be forced to sell their cane at lesser price to the existing sugar mills and those who are not even able to crush their assigned quantity of sugarcane and make timely payment of cane to the farmers, besides rendering thousands of workers directly employed in sugar factories jobless. Also, lacs of families indirectly attached with industries ancillary to the sugar industry will be severely affected as a result.
6. The petitioner acting bonafide and after complying with all the requirements stipulated in the Press Note/Notification, is setting up seven Sugar Factories at various places in U.P. with an aggregate investment of nearly Rs.1300 crores with a capacity of 7000 tonnes crushed per day (TCD) each. The petitioner has already completed and commenced production in one factory at Kinouni, Meerut, which the petitioner had set up in a record seven months period on 5.11.2004 and further three factories are already completed and ready to commence production in September, 2005 including the one which is under challenge in the writ petition in which the impugned judgment has been passed. Further, the petitioner is expecting to complete the commissioning of production in another three factories as fast as possible. The three factories are ready to operate before the on set of the forthcoming crushing season in September, 2005 to enable the farmers to take full economic advantage thereof. The remaining three factories shall commence production in 2006. The petitioner has already spent about Rs.600 crores on the purchase of land, plant and machinery and other miscellaneous expenditure. Further, the construction of buildings of the other three sugar factories and integrated distillery for production of Ethanol etc. is in full swing on which a further sum of Rs.700 crores is committed to be invested for which the petitioner had also made GD
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
