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TMI Blog1986 (9) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... nagement of its two textile mills under the Sick Textile Undertakings (Taking over of Management) Act, 1972 (for short 'Take-over Act') and also the constitutional validity of the Take-over Act and the Sick Textile Undertakings (Nationalisation) Act, 1974 (for short 'the Nationalisation Act'). It appears that the Company had falled on evil days resulting in initiation of liquidation proceedings against the Company and the appointment of a provisional liquidator. The mills of the Company were closed sometime in May, 1972. On the application by the Industrial Finance Corporation of India, the Punjab & Haryana High Court directed the Board of Directors of the Company to hand over possession of the two mills to the Corporation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the undertaking is such that it may, with reasonable inputs, be re-started in the interests of the general public, (iii) which has been leased to Government or any other person or the management of which has been taken over by Government or any other person under any leave or licence granted by any Receiver or Liquidator by or under the orders of, or with the approval of, any Court, (iv) the management of which was authorised by the Central Government, by a notified order made under section 18A, or in pursuance of an order made by the High Court under section 18FA, of the Industries (Development and Regulation) Act, 1951, to be taken over by a person or body of persons, but such management could not be taken over by such person or b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, that before actually taking possession of the undertakings of the Company, the Company should have been given an opportunity of being heard. It is submitted that if such an opportunity had been given, the Company could have shown that its undertakings were not sick undertakings. Counsel submits that the intention of the Legislature to give such an opportunity of being heard is apparent from the provisions of clauses (iv), (v) and (vi) of section 2(d) of the Take-over Act which relate to the taking over of manage- ment of an undertaking under the Industries (Development and Regulation) Act, 1951. In support of this contention, the learned Counsel has placed reliance upon three decisions of this Court in A. K. Kraipak & Ors. v. Union of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that case, it will be a sick textile undertaking. There is, therefore, no substance in the contention made on behalf of the petitioners that the Company should have been given an opportunity of being heard before the management of its undertakings was taken over as sick textile undertakings. It is next urged by the learned Counsel for the petitioners that the Legislature having itself decided the question whether an under taking is a sick textile undertaking or not without giving any opportunity to the owner of such undertaking to make a representation, has damaged the basic structure of the Constitution of India, namely, separation of power between the Legislature, the Executive and the Judiciary. Our attention has been drawn to the obser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the Take-over Act, the Legislature has not made any judicial or quasi-judicial determination, nor has the Legislature given any judgment, as contended on behalf of the petitioners, although such inclusion is sometimes loosely expressed as 'legislative judgment'. In section 2(d), the Legislature has laid down the criteria for a sick undertaking. The sick textile undertakings have been specified in the First Schedule on the basis of the tests laid down in section 2(d). In including the sick textile undertakings in the First Schedule, the Legislature has not acted arbitrarily, for, it has also laid down the criteria or tests for such inclusion. If any undertaking which has been so specified in the First Schedule does not satisfy the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioners that the amounts of compensation, which have been specified for the acquisition of these two undertakings, are inadequate. We are afraid, as on the date the Nationalisation Act had come into force, Article 31 of the Constitution was not repealed, the validity of the Nationalisation Act cannot be challenged on the ground of inadequacy of compensation. In Minerva Mills Ltd. & Ors. v. Union of India & Ors., Writ Petition Nos. 356-361 of 1977, decided on September 9, 1986, it has been already held by us that the Nationalisation Act gives effect to the policy of the State towards securing the ownership and control of the material resources of the community which are so distributed as best to subserve the common good, as contained in Art ..... X X X X Extracts X X X X X X X X Extracts X X X X
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