Under the Sick Textiles Undertakings (Nationalisation) Act, 1974, the liabilities of a sick textile undertaking in respect of a period prior to the appointed date remained the liability of the owner and could not be enforced against the Central Government or the National Textiles Corporation.

S.B.Sinha, J.

1. This writ application is directed against the demand dated 28-1-1975 as contained in Annexure 1 to the writ petition made by the Assistant Collector, Central Excise, Gaya (respondent No. 3) and the letters, dated 3-12-1979 and 2-7-1982 issued by the respondent No. 5 and respondent No. 3 as contained in Annexures 4 and 6 respectively to this writ application and further for an appropriate writ directing the respondents to forbear from raising the demand of Rs. 17,585.97 paise against the petitioner in respect of the purported arrears of Central Excise duty allegedly due on account of M/s. Gaya Textiles Private Limited. The petitioner is a unit of National Textiles Corporation.

2. The aforementioned M/s.;Gaya Textiles Private Limited, a company incorporated under the Indian Companies Act, 1956 was having its textiles mills at Gaya and was engaged in the manufacturing of cotton fabrics of different varieties. Subsequently the mill was given on lease to M/s. Gaya Cotton and Jute Mills who started running the same. It is admitted that cotton textiles and cotton fabrics are excisable goods within the meaning of the provisions of Central Excises and Salt Act, 1944 and as such Central Excise duty is payable in relation to the said goods. The aforementioned mill was closed down on 5-12-1965 and thereafter it was taken over by the Central Government pursuant to the provisions of the Sick Textile Undertakings (Taking Over of Management) Ordinance, 1972 (Ordinance No. 9 of 1972), which was published in the official Gazette of India on 31st October, 1972. By virtue of or under the provisions of Sec. 4 of the aforementioned Ordinance, the management of sick textiles undertakings vested in the Central Government with effect from 31st October, 1972.

3. The name of the aforementioned mill which was being managed by Gaya Cotton and Jute Mills, as stated hereinbefore, was mentioned in Item No. 14 of the schedule appended to the aforementioned Ordinance. The aforementioned Ordinance No. 9 of 1972 was repealed and replaced by a Parliamentary Act known as Sick Textile (Taking Over of Management) Act, 1972. By virtue of and under the provisions of the aforementioned Act, the management of all the sick textiles mills including that of M/s. Gaya Cotton and Jute Mills was taken over. Under the provisions of the aforementioned Act (Act No. 72 of 1972) a custodian was appointed in relation to the aforementioned Mill and management thereof was taken over after complying with the necessary formalities. The Parliament thereafter enacted the Sick Textiles Undertaking (Nationalisation) Act, 1974 (Act No. 57 of 1974), which was published in the official Gazette on 21st December, 1974 (hereinafter to be referred to as the said Act). In the said Act the "appointed date" has been defined to mean as 1st April, 1974, from which date the right, title and interest of the owner in relation to the sick textiles undertakings stood transferred to and vested absolutely in the Central Government or the National Textiles Corporation, as the case may be.

4. By virtue of or under the provisions of Sec. 5 of the said Act, every liability other than the liabilities specified in Sub-section (2) thereof, in relation to the aforementioned sick textiles undertakings, in respect of any period prior to the appointed date remained the liabilities of such owner and were to be enforced against them and not against the Central Government or the National Textiles Corporation.

5. By reason of the provisions of Sec.17 of the said Act, a Commissioner of Payment was to be appointed for the purpose of disbursing the amount payable to the owners of such textile undertakings. In terms of Sec.20 of the said Act provisions have been made to file claim applications before the Commissioner of Payments as a result whereof every person having a claim against the owners of sick textiles undertakings are required to prefer such claim before the Commissioner of Payments within 30