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2022 Supreme(Cal) 474
IN THE HIGH COURT OF CALCUTTA
Aniruddha Roy, J.
Tata Steel Ltd. And Another - Appellant
Versus
Union Of India And Others - Respondent
WPO 70 of 2006, IA NO: GA/3/2008 (Old No: GA/3490/2008), IA NO: GA/4/2009 (Old No: GA/1840/2009)
Decided On : 03-08-2022
Mr. Ratnanko Banerji, Sr. Advocate, Ms. Vineeta Mehria, Advocate, Mr. Jaydeb Ghorai, Advocate, Mr. Suman Chatterjee, Advocate, Mr. Diptesh Ghorai, Advocate, for the Appellant; Mr. Anindya Kumar Mitra, Sr. Advocate, Ms.Supriya Dubey, Advocate, Ms. Sneha Dutta, Advocate. Mr. S.K. Tiwari, Advocate, for the Respondent
Headnote:
Whether the first petitioner has any right on the corpus of the Steel Development Fund (SDF) and in the event such issue is decided in the affirmative, then only this Court can proceed to consider and decide whether the Central Government can utilise or transfer the corpus of the SDF in a manner as it wished to do.
Fact of the Case:
The first petitioner, a main steel plant, remitted a development surcharge to the SDF till 1994. Since 1981-82 till 2000 loans were granted to the first petitioner from the SDF as per the details, according to the petitioners, as mentioned in Annexure P-11 to the writ petition, under the terms and conditions of loan agreements executed from time to time. One such agreement, is Annexure P-12 to the writ petition. The other three members, who contributed in terms of the SDF notification, had either been refunded their respective contributions or portion of their loans had been written off by the first respondent. The entire contribution was refunded and SAIL secured a write off about Rs.5,323.71 crores of loans against its remittance. The said sum of Rs. 5,323.71 crores loan waiver to SAIL included Rs. 250.71 crores by the 11th respondent and its Managing Committee as would appear in its 35th meeting held on May 06, 1998. It could thus, according to the petitioners, apart from the first petitioner all other remitters had either been refunded their remittence or a large portion of their loans against their respective contribution had been written off. The petitioner contributed a sum of Rs. 1007.78 crores. The first petitioner, however, remitted the sum to the SDF till 1994. In 2005 the petitioners came to know that the respondents were attempted to appropriate the balance corpus of SDF and to transfer the same to Consolidated Funds of Government of India.
Finding of the Court:
The SDF was created ultimately for the utilisation by the member steel producers only, which includes the first petitioner herein. The respondents cannot contend anything contrary thereto. The corpus of SDF was and continued to be and should be year marked for the main steel producers, which necessarily includes the first petitioner herein. The first petitioner along with other main steel producers has a clear right over and above the said SDF. The Central Government cannot utilise the said SDF corpus for any other purpose other than the purposes for which the same was created for the main steel producers, which essentially includes the first petitioner herein. The SDF corpus cannot and shall not be disturbed or disrupted and transferred to any other fund as was proposed by the Central Government including to the consolidated funds of Government of India or otherwise. Decision, if any, taken by the Central Government to transfer the said SDF corpus to any other account or to deal with it in any other mode or manner or to change its character in any manner other than for the purpose of its creation and utilisation since its inception and contrary to the dictum of the Hon'ble Supreme Court In the matter of: Ispat Industries (supra), stands set aside or quashed and/or cancelled.
Issues: 1. Whether the first petitioner has any right on the corpus of the SDF? 2. Whether the Central Government can utilise or transfer the corpus of the SDF in a manner as it wished to do?
Ratio Decidendi: 1. The SDF was created ultimately for the utilisation by the member steel producers only, which includes the first petitioner herein. 2. The Central Government cannot utilise the said SDF corpus for any other purpose other than the purposes for which the same was created for the main steel producers, which essentially includes the first petitioner herein.
Final Decision: The writ petition was allowed. Consequently, IA NO: GA/3/2008 (Old No: GA/3490/2008) and IA NO: GA/4/2009 (Old No: GA/1840/2009) also stand disposed of.
JUDGMENT
Aniruddha Roy, J. - Facts:
1. TATA Steel Ltd., the successor-in-interest of the TATA Iron Steel Ltd. is the first writ petitioner. The petitioner has its one of the largest integrated steel manufacturing plants in the country at Jamshedpur, Jharkhand. Since its establishment, the petitioner had consistent investments in continuous modernization, research, development with various innovative ideas in respect of its integrated steel plant.
2. The Essential Commodities Act, 1955 (for short, the said Act of 1955) was enacted in the interest of general public for the control of production, supply, distribution of and also for trade and commerce in certain commodities. Section 2 (a) of the said Act of 1955 defines 'Essential Commodities'. Under such provision 'Iron and Steel, including manufactured products of iron and steel' were declared as essential commodities. Section 3 of the said Act empowers the Central Government, the first respondent herein, to control the production, supply, distribution of trade and commerce for the commodities specified thereunder. The Iron and Steel (Control) Order, 1956 (for short, the Control Order of 1956) was introduced under Section 3 of the act of 1955. Clause 17A and 17B of the said Control Order were introduced w.e.f. March 29, 1971. Clause 15 of the said Control Order of 1956 empowered the first respondent to fix the price of Iron and Steel and Clause 17B envisaged the setting up of a committee for the purpose of giving effect to the provisions of the said Control Order.
3. The first respondent appointed a committee in 1963, under the Chairmanship of a noted economist Dr. K.N. Raj to examine the existing system of distribution and pricing of Steel. The committees principle recommendations were as follows:
'(i) A Joint Plant Committee (JPC for short, the Respondent No. 2 herein) of the main steel producers be setup to take over the functions of the Iron and Steel Controller.
(ii) The said JPC be responsible for fixing producers prices subject to the approval of Government of India'.
4. The recommendations of the Raj Committee were accepted by the first respondent as well as the main steel producers. Accordingly by a notification dated February 29, 1964 in exercise of power conferred under Clause 17 of the said Control Order of 1956, a Joint Plant Committee (for short, JPC), the second respondent herein, was constituted. The JPC comprised of Iron and Steel Controller as its Chairman, and the petitioner, inter alia, as a member along with one member each from Indian Iron and Steel Company (for short, ISSCO) and the erstwhile Hindustan Steel Ltd. the predecessor-in-interest of the Steel Authority of India (for short, SAIL) and a member rating the Ministry of Railways. The Boakaro Steel Plant, setup under the SAIL became a member plant. Finally, Rashtriya Ispat Nigam Ltd. also became a member of the said JPC.
5. Under the same Notification dated February 29, 1964, the first respondent notified the procedures to be followed by the concerned authorities in connection with pricing of Iron and Steel. The Ministry of Steel of the first respondent by a Notification dated February 29, 1964 determined the controlled and free categories of the Iron and Steel under Clause 17 of the Iron and Steel (Control) Order, 1956 and stated that procedures to be adopted in connection with the distribution and pricing of Iron and Steel products in the controlled categories. Subsequently on April 07, 1971 under the same Clause 17B of the Iron and Steel (Control) Order 1956, the Central Government setup to committees, the Joint Plant Committee (for short, JPC) and defined their compositions and functions in terms of distribution, functions and pricing of controlled category products. The functions of JPC, inter alia, included:-
'8. The Committee may determine, announce list prices (base prices as well as extras) from time to time of all categories of iron or steel not subject to price control under clause 15 of the Iron an
