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Kamlapat Cotton Spinning and Weaving Mills Co. Ltd. Vs. Union of India and Others - Court Judgment

LegalCrystal Citation
Subject Company
CourtDelhi High Court
Decided On
Judge
Reported in[1984]56CompCas311(Delhi)
Acts Companies Act, 1956 - Sections 235, 236 and 237; Industries (Development and Regulation) Act, 1951 - Sections 15; Constitution of India - Article 226
AppellantKamlapat Cotton Spinning and Weaving Mills Co. Ltd.
RespondentUnion of India and Others
Excerpt:
the case questioned whether the central government had a right to interfere in the impugned order under section 15 of the industries (development and regulation) act, 1951 - it was stated that the subjective satisfaction should be based on relevant material and the vital facts in these material should not be ignored - as the order was the administrative in nature based on the statutorily required opinion to be formed as sine qua non for passing the order, it was struck down on the grounds of legal mala fides - section 13: [altamas kabir & cyriac joseph,jj] custody of child - welfare of child vis--vis comity of courts - the minor girl child of 3 1/2 years was brought to india by her mother. the minor girl was a citizen of u.k. being born in u.k. her parents had set up their matrimonial..........of the staggering losses. as the first petitioner was unable to bear the burden of losses of the rayon unit, it gave notice of closure with effect from july, 1983, in the form prescribed under section 25-ffa of the industrial disputes act. notice was given to the workers and demand drafts for two months' wages in lieu of notice were issued with offer to pay other labour dues. the government of uttar pradesh then took up the matter and consultations were held with the first petitioner. on 16/17th may, 1983, the factory of the first petitioner was allegedly seized by workers who prevented access to the petitioner's officers. on 8th june, 1983, the petitioners surrendered their license under the act and offered to sell the rayon unit to the central government free of encumbrances for a.....
Judgment:
ORDER

S. O. 561(E). WHEREAS the industrial undertaking known as Messrs. J. K. Rayons owned by Messrs. J. K. Cotton Spinning and Weaving Mills Company Limited, Kanpur, is engaged in the Scheduled Industry, namely, the Textiles industry.

AND WHEREAS, the Central Government is of the opinion that there has been a substantial fall in the volume of production and deteriorations in quality in respect of Viscose Filament Yarn manufactured in the said industries undertaking, for which having regard to the economic conditions prevailing, there is no justification.

AND WHEREAS, the Central Government is further of the opinion that the said Industrial Undertaking is being managed in a manner highly detrimental to the Textile industry and the public interest ;

NOW thereforeE, in exercise of the powers conferred by section 15 of the Industries (Development and Regulation) Act, 1951 (65 of 1951), the Central Government hereby appoints, for ]cause of labour trouble later in January, 1981. At the request of the first petitioner the Central Government appointed Shri Inamdar, by a communication dated June 6, 1981, for examination of the problems faced by the reyon unit with a view to finding out a solution. Shri Inamdar gave his report and findings in July, 1981. The factory which had been closed down by virtue of a closure notice was reopened in the middle of 1981. The labour trouble, however, continued as also frequent power-cuts and power interruptions. By 1982, the total loss suffered amounted to Rs. 863.86 lakhs. It is pointed out by the petitioners that by this time the rates for consumption of electricity had also been raised. The aggregate loss from 1975 to 1983 by this time came to Rs. 1,129.48 lakhs. On 12th May, 1983, M/s. J. K. Synthetic terminated the license agreement with effect from 16th May, 1983, before the expiry of the license on account of the staggering losses. As the first petitioner was unable to bear the burden of losses of the rayon unit, it gave notice of closure with effect from July, 1983, in the form prescribed under section 25-FFA of the Industrial Disputes Act. Notice was given to the workers and demand drafts for two months' wages in lieu of notice were issued with offer to pay other labour dues. The Government of Uttar Pradesh then took up the matter and consultations were held with the first petitioner. On 16/17th May, 1983, the factory of the first petitioner was allegedly seized by workers who prevented access to the petitioner's officers. On 8th June, 1983, the petitioners surrendered their license under the Act and offered to sell the rayon unit to the Central Government free of encumbrances for a token price of Rs. 1. M/s. J. K. Synthetics Ltd., also offered to transfer to the Central Government or its nominee certain assets pertaining to the aforesaid rayon unit and lying in the factory premises of the rayon unit for a token price of Re. 1. The offer was time-bound. On 11th June, 1983, however, the petitioners withdrew the time-limit placed for acceptance of the offer by the Central Government. On 15th June, 1983, the Central Government appointed a Task Force, headed by the second respondent to visit the factory premises without any prior notice to the first petitioner. The Task Force looked into the functioning and affairs of the rayon unit and submitted its report towards the end of June, 1983. Certain meetings thereafter were held between the officers of the petitioners and officers of the Central Government, the latter examining the possibility of re-starting the rayon unit. On 6th August, 1983, the impugned order was passed by the Central Government. These are the undisputed facts.

The impugned order dated 6th August, 1983, reads as under :

'MINISTRY OF INDUSTRY DEPARTMENT OF INDUSTRIAL DEVELOPMENT

New Delhi, the 6th August, 1983.


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