IMPORTANT POINT
The court upheld the constitutionality of the Chhattisgarh Chandulal Chandrakar Memorial Medical College, Durg (Acquisition) Act, 2021, affirming legislative competence and the separation of powers without infringing on judicial decisions.

JUDGMENT :

Goutam Bhaduri, J.

1.Challenge in this petition is to Sections 4, 5, 6, 8(1), 8(3) and 9 of the Chhattisgarh Chandulal Chandrakar Memorial Medical College, Durg (Acquisition) Act, 2021 (henceforth ‘the Act, 2021’); the petitioners further sought a direction towards the State authorities to include a mechanism or scheme to protect the interest of the petitioner, who is a creditor of the Chandulal Chandrakar Memorial Medical College, Durg (henceforth ‘the College’); and the petitioners also sought a relief that the provisions of Sections 4, 5 and 9 of the Act, 2021 be declared as unconstitutional, void ab initio and ultra vires to the provisions of Section 100 of the Transfer of Property Act, 1882 (henceforth ‘the TP Act’).

2.(i)The background case of the petitioner is that the petitioner is a charitable educational institution and the society runs various institutions. The respondent No.3 is a company incorporated under the provisions of the Companies Act and is running a Medical, Dental and Pharmacy College and also a hospital of 750 beded hospital. They were running the medical college in the name of ‘Chandulal Chandrakar Memorial Hospital, Motilal Nehru Nagar, Bhilai’. The letter of intent dated 30-12-2017 (Annexure-P/2) was addressed by the respondent No.3 whereby the entire assets of the Medical College and Hospital was issued in favour of the petitioners by the Board of Directors. The total consideration of the property was fixed at Rs.165 crores and token acknowledgment initially an amount of Rs.2.5 crores was paid by the petitioner to the respondent No.3, who have been shown as party No.2 & 1, respectively.

(ii) Subsequently, the Asset Purchase Agreement (Annexure – P/3) was executed in between the petitioner and the respondent No.3 wherein the following assets (as mentioned in para 8.3 of petition) were agreed to be purchased by the petitioner No.1 :

a) Medical College under the name and style of "Chandulal Chandrakar Memorial Medical College located at Kurud Road, Durg District, Kachundar, Chhattisgarh – 490024;

b) Medical Hospital under the same campus at Kurud Road, Durg District, Kachandur, Chhattisgarh – 490024; and

c) 25 acres of land at Durg District, Kachandur - Property, more particularly described in the asset purchase Agreement, along with all movable and immovable assets, rights, title, entitlements, intellectual property, equipment, governmental authorizations etc. in relation to the aforesaid properties.

(iii) Thereafter, advance amount of Rs.4,04,43,000/- was paid, as per Article-3 in part. It was further agreed that for whatsoever reasons buyer fails and wants to delay the process of registry, it shall do so after making balance payment of Rs.133.50 crores to seller on or before 25-2-2018, after receipt of which seller will give power of attorney to buyer for registry. Further it was agreed that if the purchaser failed to pay the balance amount by 25-2-2018 the seller shall be at liberty to continue/not with this asset purchase agreement.

(iv) Some dispute arose between the parties, therefore, the notice for termination of contract was served to the petitioner on 30-6-2018 (Annexure-P/4) and thereafter some negotiations were going on in between the parties. In the meanwhile, the Act, 2021 came to into force. Thus, this petition.

3.(A)Learned counsel appearing for the petitioners would submit that Sections 4, 5, 6, 8(1), 8(3) and 9 of the Act, 2021 were beyond the legislative competence of the State, therefore, they are required to be declared unconstitutional. He would further submit that Section 4 starts with non obstante clause, which includes that any order or judgment or decree of any Court on in any contract the properties of the College together with its associated hospital shall vest in Government and any right, possession and interest of any person including a juristic or other organisation shall be ceased. He would submit that Section 4 is in two parts that any order of decree is nullified by