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1994 (5) TMI 263 - SC - Indian Laws

Issues Involved:
1. Validity of the Government Order dated 6-7-1988.
2. Compliance with the procedural requirements u/s 3(1) of the Kerala Cashew Factories (Acquisition) Act, 1974.
3. Grounds for acquisition of cashew factories.
4. Consequences of non-compliance with statutory requirements.

Summary:

1. Validity of the Government Order dated 6-7-1988:
The petitioners, owners and occupiers of cashew factories, challenged the validity of the Government of Kerala's order dated 6-7-1988, issued u/s 3(1)(c) of the Kerala Cashew Factories (Acquisition) Act, 1974, which declared that their factories shall stand transferred to and vest in the government.

2. Compliance with Procedural Requirements u/s 3(1):
The Act mandates that before making a declaration u/s 3(1), the Government must issue a notice to the occupier and owner of the factory, stating the grounds for the intended action and consider any objections. The notice must also be published in two newspapers. The petitioners argued that the notice issued did not meet these requirements, as it lacked specific details and grounds.

3. Grounds for Acquisition of Cashew Factories:
The notice issued on 20-6-1988 cited that the factories were lying closed and there was no possibility of them starting within ten days or in the immediate future, leading to large-scale unemployment. The petitioners contended that the notice did not specify whether the Government's satisfaction was based on any of the conditions mentioned in clauses (a), (b), or (c) of Section 3(1). They also pointed out that cashew factories are seasonal and operate based on the availability of raw nuts.

4. Consequences of Non-Compliance with Statutory Requirements:
The Court held that the notice did not comply with the mandatory requirements of the proviso to Section 3(1). It lacked specific grounds and details necessary for the petitioners to file objections. The Court emphasized that serious consequences follow from such orders, and the Government must furnish full particulars to justify its satisfaction for taking over the factories. The notice was declared null and void, and the order dated 6-7-1988 was quashed.

Directions:
The Court directed the Government to hand over possession of the factories to the respective owners within two weeks, retain daily workers, pay the same salary and emoluments, and assess any claims for damages or additional constructions through the District Judge, Quilon. The Kerala State Cashew Development Corporation Ltd. was allowed to remove any machinery or materials installed by it within one week of inventory preparation. Any pending disciplinary enquiry against workmen could be continued by the factory owner.

The writ petition was allowed, and other related writ petitions were disposed of in terms of this judgment.

 

 

 

 

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