The impugned Act did not trench upon any field occupied by the Central legislation and was saved from challenge under Arts. 14 and 19 under Art. 31C of the Constitution.

Headnote:
Super Clays and Minerals Mining Company - Constitutional Challenge - Industries (Development and Regulation) Act, Mines and Minerals (Regulation and Development) Act - The court discussed the constitutional challenge to the Super Clays and Minerals Mining Company (Private) Ltd. (Acquisition of Undertakings) Act, 1983, and the conflict between the State and Central legislations. The court found that the State Legislature was not denuded of its powers to legislate in respect of acquisition of mines and minerals, and that the impugned Act did not trench upon any field occupied by the Central legislation. The court also held that the Act was saved from challenge under Arts. 14 and 19 under Art. 31C of the Constitution.
Fact of the Case:

The Super Clays and Minerals Mining Company (Private) Limited faced financial difficulties and was taken over by the Government under the Relief Undertakings Act. The company's undertakings were later acquired by the Government under the Super Clays and Minerals Mining Company (Private) Ltd. (Acquisition of Undertakings) Act, 1983. The petitioners challenged the Act on the grounds of constitutional validity and legislative competence.
Finding of the Court:

The court found that the impugned Act did not trench upon any field occupied by the Central legislation and was saved from challenge under Arts. 14 and 19 under Art. 31C of the Constitution. The court also dismissed the contention that the acquisition was made at the request of all the shareholders of the Company.
Issues: Constitutional challenge to the Super Clays and Minerals Mining Company (Private) Ltd. (Acquisition of Undertakings) Act, 1983, and the conflict between the State and Central legislations.
Ratio Decidendi: The State Legislature was not denuded of its powers to legislate in respect of acquisition of mines and minerals, and the impugned Act did not trench upon any field occupied by the Central legislation. The Act was saved from challenge under Arts. 14 and 19 under Art. 31C of the Constitution.
Final Decision: The original petition was dismissed, and leave to appeal to the Supreme Court was refused.

Judgment :-

Viswanatha Iyer, J.

This original petition under Article 226 of the Constitution essentially challenges Ss.3 and 7 of the Super Clays and Minerals Mining Company (Private) Ltd. (Acquisition of Undertakings) Act. 1983. Kerala Act 3 of 1984. (for brevity the act). and seeks a declaration that the said Act is unconstitutional. though the prayers. as they are. are couched in inartistic language. The original petition is filed in the following

circumstances.

2. There are three petitioners of which the second petitioner is the Company. The Super Clays and Minerals Mining Company (Private) Limited (hereinafter referred to as the Company). Petitioners land 3 are two of its share holders. the first petitioner Smt. Elizabeth Samuel Aaron claiming to bet its single largest share holder. The main object of the Company is to mine China Clay. purify and supply the same to various industries for the manufacture of fire bricks. refectories lining bricks. China ware etc.

The Company commenced its operations in 1973. but soon ran into great financial difficulties. which constrained the management to declare a lay-off on January 13.1975 for the period up to March!. 1976. The Company was employing about 600 workers. The declaration of lay-off led to labour unrest consequent on the Company's failure to pay the lay-off compensation. At the third annual general body meeting of the Company held on November 22.1975. it was resolved to request the Government to take over the Company and to restart production. to avoid complete deterioration of its assets. A true copy of the minutes of the said general body meeting is Ext. R1(a).

3. After lengthy discussions. Government decided to declare the industrial undertaking of the Company as a relief undertaking under S.3 of the Kerala Relief Undertakings (Special Provisions) Act. 1961 (Act 6 of 1962) (Relief Undertakings Act. for short) for a period of two years. Government accordingly issued notification on March 2.1976 declaring the industrial undertaking of the Company as a relief undertaking under the said Act. Simultaneously another notification was issued declaring moratorium on certain liabilities of the Company. The management of the Company was taken over and entrusted to the Kerala State Industrial Enterprises Ltd.. a Government Company. as its agent. The Board of Directors of the Company also passed resolution Ext. R1(b) on March 4, 1976 regarding handing over of the management to Government. The notification under the Relief Undertakings Act was extended from time to time up to March 1.19.84. -It is said that under the management of the Kerala State Industrial Enterprises Ltd.. the Company started making marginal profits. Petitioners 1 and 2 then challenged the extension of the notification under the Relief Undertakings Act. made in 1981. and subsequently. by filing a writ petition O.P. No. 1817 of 1981. despite the fact that all the share-holders had joined together in requesting the Government to take over the Company (vide Ext. R1(a). at the third annual general body meeting held on November 22, 1975. The original petition was dismissed by a Division Bench of this court by judgment dated March 23.1983. a true copy of which is produced and marked as Ext. P1. The judgment is also reported as Mrs. Elizabeth Samuel Aaron v. State of Kerala. at page 225 of 1983 All India Reporter (Kerala). Inter alia. this court found that the main object of the Company was to produce crude china clay and to purify and supply the same to various industries. This court rejected the contention of the petitioners that "the Company must be deemed to be an undertaking engaged in ceramic industry because it produces purified clay". Consequently it was held that S.20 of the Industries (Development and regulation) Act (Central Act 65 of 1951) (Industries regulation) Act. in brief ) did not apply as to interdict the State of Kerala from taking over the control or management of the Company under the Relief

Undertakings Ac

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1991 Supreme(Ker) 29

The impugned Act did not trench upon any field occupied by the Central legislation and was saved from challenge under Arts. 14 and 19 under Art. 31C of the Constitution.

Cases Referred (2)