Present:
(Hon'ble Mr. Justice Amitava Lala and Hon'ble Mr. Justice Ashok Srivastava) Appearance For the petitioner : Mr. Chetan Chaterjee For the respondents: Mr. Navin Sinha, Senior Advocate, Mr. R.K. Riazada, Mr. Rohit Agarwal, Mr. D.P. Singh, & Dr. Y.K. Srivastava, Standing Counsel.
Amitava Lala, J.--The petitioner is a sugar mill in the State challenging the U.P. Sugar Undertakings (Acquisition) (Amendment) Act, 2009 as ultra-vires and other prayers prohibiting the respondents from proceedings against the property of the petitioner, which was not covered under the order dated 10.04.1972 and consequently adopted under the acquisition proceedings dated 28.10.1984 to the benefit of the respondent no.6. The State Government has no jurisdiction to sell the Saharanpur unit of U.P. State Sugar Corporation as came to be vested in the corporation. Call for the records and quash the decision of the State inclusive of proceedings for sell and other consequential effects.
At the threshold the State has raised preliminary point by saying that the writ petition is not maintainable in view of the fact that U.P. Sugar Undertakings (Acquisition)(Amendment) Act, 2009, has already declared as intra-vires by a Division Bench of this Court on 1.4.2010 in Civil Misc. Writ Petition No. 39850 of 2009 (Chini Mill Karamchari Sangh Vs. State of U.P. & Others).
We have gone through the operative part of the order of the Division Bench which is as follows:-
" In the result both the writ petitions are partly allowed. Section 3-C and Section 3-D to the extent it provides "closure of the scheduled undertakings or sugar mills of the Corporation itself" is struck down as lacking legislative competence. All consequential actions to the above extent shall automatically fall on the ground. The other provisions of the Amendment Act, 2009 and the actions taken therein are held to be intra-vires."
From the plain reading of the order it appears that last part of the Section 3-D was declared as ultra-vires. However entire insertions by an Amendment being Sections 3-A, 3-B, 3-C, 3-D and 3-E in U.P. Act No.23 of 1971 are quoted hereunder:-
"3-A. Notwithstanding anything to the contrary contained in any other provision of this Act, the State Government may, if it considers necessary or expedient in public interest, divest, sell off, transfer or otherwise part with all or any of its shares in the Corporation at any time.
3-B. Notwithstanding anything to the contrary contained in any other provision of this Act, the Corporation or any of its subsidiaries may, in public interest, sell or transfer any of its assets and/or liabilities or part thereof which have vested in the Corporation in accordance with the provisions of this Act, or in any other manner.
3-C. Notwithstanding anything to the contrary contained in any other law for the time being in force it shall be lawful for the State Government, if it is satisfied that in the public interest it is necessary to do so, to change the land use or to issue directions for change of land use in relation to the land belonging to the scheduled undertakings of the Corporation or in relation to land belonging to any sugar mill acquired or established by the Corporation or its subsidiaries at any time.
3-D The Government Order No.1215S.C./18-2-07-56/07 T.C. dated June 4, 2007 and all subsequent Government Orders, notifications or policy statements issued and actions taken in relation to disinvestment, privatization, sale, transfer in any form or closure of the scheduled undertakings or sugar mills of the Corporation and its subsidiaries or in relation to the Corporation itself shall stand validated.
3-E Power to remove difficulties.- If any difficulty arises in giving effect to the provisions of this Act, the State Government, may by notified order make provisions not inconsistent with the provisions of this Act as may appear to it to be necessary or expedient for removing such difficulty.
Provided that no order under this section shall be made after expiration of a period of two years from the commencement of the Uttar Pradesh Sugar Undertakings (Acquisition) (Amendment) Act, 2009.
Mr. Y.K. Srivastava, learned Standing Counsel has contended before us that the writ petition is hit by the principles of constructive res-judicata. Mr. Navin Sinha, learned Senior Counsel appearing for the respondent no.6 has added by saying that when the order has been passed by the coordinate Bench it has been challenged before the Hon'ble Supreme Court and the matter is pending without any interim order, then it is not proper for the petitioner to invoke the writ jurisdiction once again for the same purpose. He further submitted that if it allowed to continue it will become never ending process. Moreover, if ultimately the Supreme Court holds contrary to the decision of the Division Bench, which has been passed earlier then the remedy will be available to the petitioner. To that Mr. Chetan Chaterjee, learned counsel appearing for the petitioner contended before us that principles of constructive res-judicata might be applicable between the parties but since the petitioner was not the party in the earlier writ petition, there is no bar to the petitioner to take different points in challenging the vires of an Act.
According to us there is a fundamental difference between res judicata and constructive res-judicata. If we go by the nomenclature we able to see that plinth of constructive res judicata is construction. Constructive res judicata applies on the basis of the explanation IV under Section 11 of the Code of Civil Procedure which is as follows:-
Explanation IV- Any matter which might and ought to have been made ground of defence or attack in such former suit shall be deemed to have been a matter directly and substantially in issue in such suit.
In the instant case two pertinent questions arose namely:-
(a) Whether challenge of vires which was finally adjudicated by a coordinate Bench, can be reopened in a separate writ petition initiated by different writ petitioners?
(b) Whether raising of such questions will be hit by the principle of constructive res judicata?
According to us both the questions are mixed up with each other. Essence of res judicata and/or constructive res judicata are borrowed from the Code of Civil Procedure, 1908. Naturally when dispute between the two private parties arises in the Court, the issue can be taken in a subsequent proceeding provided the same litigating parties are also the parties in the said proceeding. Now principles of res judicata and/or constructive res judicata apply to the Writ Court. In the Writ Court, public law elements are required to be dealt with. Such dealing may affect an independent or a community or public as a whole. When the Writ Court decides a question about a provision of law whether the same is ultra-vires or intra-vires, it will be applicable to the public at large since such Act is made for all not for an individual. Hence, even if the petitioner was not a party to such proceeding but by and large taking a plea to declare the provision of law as ultra-vires it may lead to be a question of constructive res judicata, even if he is not a party to previous proceeding. Having so the binding effect of such judgment upon the petitioner cannot be ignored.
The petitioner has further contended that declaration of the provision as intra-vires was made from a different point of view but not from the point of view the petitioner approached the Writ Court. According to us, if any point of view has taken by the petitioner to challenge the provision of the Act as intra-vires it will only be considered within the limited scope of the Writ Court. Once the coordinate Bench has declared the said Act as intra-vires, it will be presupposed that the Court had considered the scope before adjudicating a provision as intra vires unless it is grossly militating with the basis of the two Cases. It is not so.
The respondents' further contention is that the acquisition was held as far as back in 1984 and the challenge has been thrown after a period of 25 years with regard to a portion belongs to the petitioner. How the portion of the petitioner can be demarcated by the Writ Court is not known to us. It obviously requires to be dealt with in an appropriate suit before the Civil Court.
In AIR 1981 SC 124, ( New Satgram Engineering Works Vs. Union of India), it has been held by the three Judges Bench of the Supreme Court that there was no special machinery provided in the Act for determining the question whether a particular asset fell within the definition of 'mine', (as in the case therein) contained in Section 2(h) of the Act, it ought to have, on the facts and circumstances of the present case, decided the said question in the exercise of its jurisdiction under Article 226 of the Constitution or not. The answer is given by saying that whether there is a particular property vests or not, the dispute undoubtedly is a civil dispute and must, therefore, be resolved by a suit. To which, Mr. Chetan Chaterjee has contended before us that there is no scope of suit in view of Section 20 of the U.P. Sugar Undertakings (Acquisition) Act, 1971. We find that Section 20 is applicable in a different context. It is with regard to action of the official taken in a good faith. It has nothing to do with regard to vesting of the assets or not.
Mr. Navin Sinha, learned Senior Counsel has contended that in this case the assets were transferred. There is an already a civil suit being O.S. No. 43 of 2011in the Court of Civil Judge (Sr. Div.), Saharanpur and National Textile Corporation, one of the respondent herein made the petitioner and the respondent no.6 parties therein. Though the suit was not proceeded for non-deposit of court fees, but said factual aspect ought to have placed before this Court but the petitioner did not disclose such fact.
In totality, we do not find any reason to interfere with the matter, but keep it open to be decided either in a pending suit or in any suit to be instituted by any of the parties inclusive of the petitioner. So far as the question of ulta-vires is concerned, we are of the view that once the matter is decided by a coordinate Bench and subjudice before the Supreme Court, propriety demands not to pass any order questioning the vires which has already decided on the similar circumstances.
The writ petition, therefore, cannot be admitted. It is accordingly dismissed, however, without imposing any cost.
(Justice Amitava Lala) I agree.
(Justice Ashok Srivastava) Order Dated: 5.7. 2011 PKS