Skip to content


Narayanan Sankaran Mooss Vs. State of Kerala and anr. - Court Judgment

LegalCrystal Citation
Overruled ByNarayanan Sankaran Mooss Vs. The State of Kerala and Anr.
SubjectElectricity
CourtKerala High Court
Decided On
Case NumberO.P. No. 1138 of 1963
Judge
Reported inAIR1965Ker253
ActsConstitution of India - Articles 14, 19(1), 19(5), 19(6), 32 and 226; Electricity Act, 1910 - Sections 4, 4(1), 4(3), 5, 5(1), 6, 7A(1), 7A(2) and 7A(4)
AppellantNarayanan Sankaran Mooss
RespondentState of Kerala and anr.
Advocates: K.V. Suryanarayana Iyer and; S. Subramonia Iyer, Advs.
DispositionPetition dismissed
Cases Referred and Radheshyam Khare v. State of Madhya Pradesh
Excerpt:
electricity - revocation of licence - sections 4 to 7 of electricity act, 1910 - petitioner challenged legality and validity of impugned notice and two orders of government canceling his licence - petitioner's licence for supplying electricity was revoked by state government - resolutions passed by district development board and municipal council requesting government to revoke licence of petitioner - petitioner made willful and unreasonably prolonged default in doing things required of him under act - opinion formed by state government for revoking licence of petitioner subjective one which cannot be tested by objective standards - grounds for formation of opinion of taking impugned action do not fall for consideration for review by courts so long authority acted honestly and material.....vaidialingam, j.1. in this writ petition under article 226 of the constitution, mr. k. v. surianarayana iyer, learned counsel for the petitioner, who is the proprietor of the kottayam electric supply agency, kottayam, challenges the legality and validity of a notice and two orders passed by the state government under the indian electricity act (act ix of 1910), hereinafter to be referred to as the act the notice is ext. p1 and the orders arc exts. p2 and p3.2. ext. p1 is a notice dated 17-8-1962 issued by the 1st respondent, the state of kerala, under section 4(3) of the act, calling upon the petitioner, for the various grounds mentioned therein, as to why the license granted in his favour should not be revoked under section 4(1)(a) of the act. the petitioner sent an explanation dated.....
Judgment:
Vaidialingam, J.

1. In this Writ Petition under Article 226 of the Constitution, Mr. K. V. Surianarayana Iyer, learned counsel for the petitioner, who is the proprietor of the Kottayam Electric Supply Agency, Kottayam, challenges the legality and validity of a notice and two orders passed by the State Government under the Indian Electricity Act (Act IX of 1910), hereinafter to be referred to as the Act The notice is Ext. P1 and the orders arc Exts. P2 and P3.

2. Ext. P1 is a notice dated 17-8-1962 issued by the 1st respondent, the State of Kerala, under Section 4(3) of the Act, calling upon the petitioner, for the various grounds mentioned therein, as to why the license granted in his favour should not be revoked under Section 4(1)(a) of the Act. The petitioner sent an explanation dated 5-11-1962, Ext. P19; and the State Government passed the order Ext. P2 dated 17-5-1963 revoking the license under Section 5(1)(a) of the Act and fining 1st August 1983 as the date on which the said revocation shall take effect. In consequence, on the same date, the State Government passed another order, Ext P3, under Section 5(1)(c) and 5(3) of the Act, calling upon the petitioner to sell and deliver the undertaking to the 2nd respondent in these proceedings, the Kerala State Electricity Board, on or before 1st July 1963. At this stage, we may also mention in this connection that certain communications passed between the 1st respondent State and the 2nd respondent Electricity Board; and we will have to revert, not only to those communications but also the matters referred to in Exts. P1, P19, P2 and P3, at a later stage.

3. The petitioner's father was granted a license for supplying electrical energy within the Municipal town of Kottayam under the Travancore Electricity Act, Act I of 1097, by order of the then State Government dated 14th February 1930. The conditions, rates, as well as the area of supply and other allied matters, are all referred to in detail in the said' licence. Ext. P4 is a copy of the license. In particular, Clause 10 of the said license provides for an option of purchase given under Section 7(1) of the Travancore Electricity Act and also as to when exactly that option is to be exercised. There can be no controversy that if the license is to have full force, the first exercise of the option can be only at the expiration o( 50 years from 14th February 1930.

4. The petitioner obtained an assignment of the right of his father, by a registered document dated 30-7-1945; and the Government also approved the said transfer and confirmed the same. The transfer itself took effect from 15th June 1959, as will he seen from the publication made o the transfer in the Travancore-Cochin Government Gazette dated 19th. June 1958.

5. There is no controversy that the Act was extended with effect from 1-4-1951, to the State of Travancore-Cochin, which was formed on 1st July 1949. The Act also repealed the Travancore Electricity Act, Act I of 1097, with regard to various matters excepting such rights and obligations which had already accrued or have been incurred under the Travancore Act. There is also no controversy that under the Act and the relevant clauses in the license, the petitioner will ordinarily be entitled to continue the license for another period of 17 years, at the end of which it may be open to the Government, to exercise the option given to them to purchase the undertaking, by virtue of the conditions granting the license. At this stage it may also be mentioned that under Section 70(2) of the Electricity (Supply) Act, Act LIV of 1948, which will hereafter, be referred to as the Supply Act, it is provided that except as otherwise provided in the Act, the provisions of the Supply Act shall be in addition to and not in derogation of, the Act of 1910.

6. Before adverting to the circumstances under which the notice Ext. P1, and the Orders Exts. P2. and P3 which are under attack in this writ petition, came to be passed, it is necessary to set out certain other events which took place between 1959 and 1962. Under Ext. P20 dated 28-4-1959, the Superintending Engineer Electrical, Ernakulam, sends a communication to the petitioner. In that communication it is stated that several complaints have been, and are being received from consumers of electricity in Kottayam town that the voltage obtained is far below normal and that on account of that, considerable difficulty is being experienced by them. The Superintending Engineer points out that under Rule 54 of the Indian Electricity Rules, the supplier has to maintain the supply voltage within 5% of the declared voltage, which, in the case of the petitioner is 230 volts between phase and neutral. He also points out that voltage of supply should not therefore be below 218.5 at any time. The officer encloses a statement furnished by the Assistant Engineer, M. R. T. Sub-Division, Pallom, based on a reading of the recording voltmeter conducted by him under the instructions of the Superintending Engineer, and points out to the. petitioner that according to that statement it will be seen that very many places require strengthening of feeders and installation of additional transformers. The Superintending Engineer further states that all the works necessary for the said purpose are to he completed within a period of 9 months from 28-4-1959. It will also be seen that the communication Ext, P20 appears to be in continuation of an earlier communication dated 22-1-1959. Along with Ext. P20, a statement is also given detailing the 5 places where voltage has been taken, as well as the exact voltage position that was found between the hours mentioned therein.

7. As will be seen from Appendix II to Ext. R1 filed on behalf of the State, there was a reminder sent on 26-11-1959 by the Superintending Engineer and Electrical Inspector, Electrical, Ernakulam to the licensee. The petitioner appears to have sent certain replies to Ext. P20, as will be seen from Appendix II to Ext. R1. After referring to various matters, the Superintending Engineer draws the attention of the petitioner to the communication already sent under Ext. P20 on 28-4-1959 and also asks for information from him as to what action be has taken to improve the voltage in his supply area. In the said letter it is also pointed out by the Superintending Engineer that the plans prepared by the petitioner for the said purpose as well as the progress already achieved are also to be intimated by return, to enable the Superintending Engineer to judge whether suitable action has been taken. In particular, the Superintending Engineer states that out of the period of 9 months granted on 28-4-1959, nearly 7 months have already elapsed. Along with Appendix II to Ext. R1, the Superintending Engineer encloses the latest statement which he appears to have received from the Executive Engineer, Electrical Division, Pallom, after taking voltages in the distribution systems of the petitioner on 4-11-1959 and 6-11-1959, which, it is stated, shows the poor condition of the supply.

8. There appears to have been a conference between the officials of the Department as well as the petitioner, as will be seen from the communication Ext. P23 dated 14-3-1990. The conference itself appears to have taken place on 13-3-1960 between the Superintending Engineer and the Resident Engineer of the petitioner's undertaking, at the residence of the petitioner. In Ext. P2S the Superintending Engineer requests the petitioner to confirm the various matters referred to therein. As will be seen from the minutes enclosed with Ext. P23, the various matters appear to have been discussed between the officers on the one hand and the petitioner on the other. They related to the low voltage in various parts of the distribution system, the exorbitant deposits that are being demanded and realised by the petitioner from the consumers in the area for service connections, suggestions for strengthening of feeders for maintaining proper voltage, as also the advantages to be had by taking a second point of supply at the Thashathangadi area.

After referring to these points, the Superintending Engineer states in the minutes that the petitioner pointed out that immediately on receipt of instructions from the Electrical Inspector regarding the improvement of the voltage at various parts of the distribution system at Kottayam, he has placed necessary orders for the materials such as copper wire etc. required, but due to scarcity of that item as well as the delay in the supply, he could attend to only 30% of the feeder strengthening work. The minutes also state that the petitioner has agreed to have the balance materials obtained in the course of the next two months and that he has also promised to complete the remaining works in the course of next two months from 13-3-1960. It is also stated that the petitioner has agreed to abide by the various instructions of the Electrical Inspector in regard to the realisation of deposits and service connection charges. Then there are various other matters referred to in the minutes, one of which is that the petitioner appears to have made a request for loan of a transformer from the Board on hire, and that request was allowed. There is a further statement in the minutes to the effect that with regard to the additional point of supply at Thazhathangadi, the then low voltage in the premises of the consumer, Messrs. Swaraj Plywood, will be rectified and that it is expected that there will not be any reason for further complaint on that account.

9. The petitioner sent a communication, Ext. P24 dated 19th March 1960, to the Superintending Engineer, Electrical, Ernakulam regarding clarification of some points in the minutes enclosed with Ext. P23, but that does not come into the picture in these proceedings, On 13th August 1980, under Ext. P25, the petitioner, after referring to Ext. P20, as well as the personal discussion that be appears to have had with the Superintending Engineer on 12-8-1960, sends a communication to the latter, to the effect that the works connected with voltage improvement have been completed within the stipulated period. He also encloses a copy of the month-war statement as required by the Executive Engineer Electrical Division, Pallom, for information of the Superintending Engineer. Ext. P26 is the said month-war statement of progress which, according to the petitioner, he has effected for improving the voltage position in the various places mentioned therein.

10. Then we come to another group of documents relating to two suits, namely a suit filed by the petitioner as against one of the consumers in the area, viz.. the National Tyre and Rubber Go. of India, Ltd., Kottayam, and a suit, filed by the latter as against the petitioner, O. S. No 86/1956 on the file of the Sub Court of Kottayam was the suit filed by the petitioner against the said Rubber Company for realisation of a sum of Rs. 56,797/- odd, representing the arrears of current charges etc., stated to be due from them. The Rubber Company's suit O. S. 13/57, on the file of the same court, was one claiming, certain amounts as refundable to them. In that suit, the company also applied in I. A. No. 147/57 for an injunction restraining the petitioner from disconnecting the electrical connection to their premises. That became probably necessary in view of the fact that the petitioner had issued a notice of disconnection of supply to the company under Section 24 of the Act, on 24-5-1957. The order on I. A. 147/57 is Ext. P5 dated 1st August 1957. We do not think it necessary for the purpose of this case, to refer to the various matters referred to therein, excepting to state that the application filed by the company for an injunction restraining the petitioner from disconnecting the service line, was not granted in toto, but only subject to the Rubber Company depositing certain amounts in court.

11. Under Ext. P6 dated 21-10-1960, a communication is sent by the Chief Engineer (Electricity) to the petitioner, stating that the petitioner should not disconnect the service installation to Messrs. National Tyre and Rubber Co. of India Ltd., Kottayam, until further orders from his office. On receipt of the said communication, the petitioner under Ext. P7, dated 24th October 1960, sends a reply to the Chief Engineer, Kerala State Electricity Board, the 2nd respondent. The petitioner, in that communication, after referring to Ext. P8, states that he is not aware of any dispute between the petitioner's undertaking and the Rubber Company having been referred to the, Electrical Inspector for adjudication, The petitioner also refers to the fact that large amounts are due to him as arrears from the said company. He refers to the fact that he has instituted the suit O. S. 88/59 in the Kottayarn Sub Court for recovery of the arrears. Even on the basis that a reference for an arbitration has been made, the petitioner states that under Section 24 of the Act the disconnection notice already issued cannot he stayed unless the consumer deposits all the arrears that have accrued till date. Therefore the petitioner requests the Chief Engineer of the 2nd respondent Board to call upon the Rubber Company in question, to deposit the arrears as a condition precedent for granting the stay that he has ordered under Ext. P6,

12. Under Ext. P. 8, dated 24th October 1960 the petitioner sends a communication to the National Tyre and Rubber Co. of India Ltd., to the effect that it is seen that the company has referred the matter to the Electrical Inspector and that the Electrical Inspector has issued instructions, under Ext. P. 6, directing the petitioner that no disconnection should be made until otherwise directed. The petitioner also gives a statement of account regarding the arrears due from the company, in the sum of Rs. 1,15,159.45, and he requests the company to make a deposit of the said amount. To that letter, the Rubber Company sends a reply Ext. P. 9 dated 25th October 1960. After acknowledging the communication Ext. P. 8, the company takes up the position that the statements contained in Ext. P. 8 are all false and not according to facts. They categorically state that they have not made any reference at all to the Electrical Inspector; but they refer to certain other matters regarding their not being aware of any separate meter having been installed in their factory. Then they refer to the fact that inasmuch as they have not made any reference to the Electrical Inspector under Section 24 of the Act, they are not bound to deposit any arrears, and the question of their liability for any arrears is already under dispute before the Sub-Court, Kottayam.

13. The petitioner, on receipt of this communication from the Rubber Company, sends a further letter Ext. P. 10 dated 24th December 1980, to the Electrical Inspector and Chief Engineer (Electricity), Trivandrum. In that letter the petitioner refers to Ext. P. 6. the order, passed on 21-10-1960 by the said officer. Then he refers to the letter sent by him, Ext. P. 8 to the Rubber Co. as well the reply received from the Rubber Company, Ext. P. 9. The petitioner ultimately estates that inasmuch as no reference appears to have been made under Section 24 of the Act, the order passed under Ext. P. 6 prohibiting the petitioner from disconnecting the electric connection to the Rubber Company is illegal and without jurisdiction. Therefore he requests the officer to recall the said order forthwith, as otherwise he will be constrained to take legal proceedings seeking appropriate reliefs. Then there is a communication Ext. P. 11 dated 12th January 1981 from the Chief Engineer (Electricity) and Electrical Inspector to Government, to the petitioner, referring to the correspondence ending with Ext. P. 10 and stating that the National Tyre and Rubber Co. of India, Ltd., Kottayam, have presented a petition for decision under Clause (1) of Section 24 of the Act. The petitioner is asked to arrange to file a detailed statement justifying his claim. Then there is a further statement to the eifect that as the consumer (referring to the National Tyre and Rubber Co.) has referred the matter to the Chief Engineer, the further action proposed to be taken by the petitioner will have to be Kept in abeyance till the case is fully investigated by the Chief Engineer and orders issued.

14. Under Ext P. 12 dated 27-1-1961, there is smother communication from the Electrical Inspector to Government, Trivandrum, to the petitioner, stating that the petitioner is to file the details of his demand as against the National Tyre and Rubber Co., Kottayam, inasmuch as a dispute under Section 24 of the Act has been referred to him. The petitioner, under Ext. P. 13 dated 22nd February 1961, sends a reply to the Electrical Inspector to Government, Trivandrum, wherein he refers to his previous letter of 17-1-1961 as well the reply of the Officer (Ext. P. 12); and requests the officer to furnish him with a copy of the reference stated to have been made by the Rubber company. In that communication, the petitioner also takes up the position that no amount is refundable to the said consumer.

15. Obviously the request of the petitioner was not complied with by the Electrical Engineer, with the result that the petitioner came to this Court in O. P. No. 475/1961 to quash the final order of the Electrical Engineer, viz., Ext. P. 11 in these proceedings, dated 12th January 196L. To that writ petition, the Electrical Inspector to Government, who has been sending the various communications referced to above, as well as the National Tyre and Rubber Co. of India Ltd., Kottayam, who are claimed by the Electrical Inspector to have made a reference under Section 24 of the Act, were the two respondents. That writ petition was disposed of by our learned brother Raman Nayar, J., by his judgment dated 19th December 1961, Ext. P. 14. It is enough to note that the learned Judge ultimately accepted the contention of the petitioner, and allowed the writ petition with costs, as against the 2nd respondent, and quashed the communication Ext. P. 11, dated 12-1-1981. The petitioner's suit against the Rubber Company was eventually decreed and the company's suit dismissed.

16. We have rather exhaustively referred to this group of correspondence and the litigations between the Rubber Company and the petitioner, because a very strenuous attack has been made against the orders Exts. P. 1 to P. 3, passed by the State Government, that those orders have been passed mala fide. There is one other aspect that will have to he referred to at this stage, namely that the Managing Director of the National Tyre and Rubber Co. of India Ltd., was nominated as a member of the 2nd respondent Board on 1-4-1962.

17. There are two other letters that will have to be adverted to, namely Exts P. 15 and P. 18. Ext. P. 15 dated 14th March 1962 is a communication issued by the Electrical Inspector to Government and Chief Engineer (Electricity), Trivandrum to the petitioner. In that communication the Electrical Inspector states that it has come to his notice, during his inspection on 20-1-1962 of the petitioner's distribution system within the area of supply, that the maintenance of the system is most unsatisfactory. 'The Electrical Inspector gives a list of the salient defects that had come to his notice, for the petitioner's immediate attention and rectification. In particular, one of the defects that is noted is about the voltage in the several places mentioned therein, being found to he far below the limits prescribed in Rule 54 of the Indian Electricity Rules 1956. Then there are certain other defects also pointed out, namely that the line supports are very badly maintained, most of the steel poles are rusted and wooden poles eaten by white ants, many of the line poles are very badly leaning from the vertical. It is also stated that many of the street lights are not fixed properly on the line supports, and that street light bulbs are hanging and that there are many street tights with no reflectors at all.

The Electrical Inspector further states that the distribution systems in most of the places are covered by branches of nearby trees. In particular he refers to some of the places where this defect has been noticed, agd he is of the view that consequently the specified safety clearances from the live lines are not obtained in those places. The overhead crossings for services are stated to have not got sufficient clearances from the road. Here again some of the places where this defect is noted are indicated by the Electrical Inspector. The Inspector further proceeds to state that the conductors at the fag end in the Kanjikuzhi area are of insuufficient capacity and strength and that many of the weather-proof service lines crossing the road are found to be deteriorated, braiding, and of bad insulation. It is also stated that due to the bending and slanting of cross-arms on line supports, the overhead lines are sagging badly.

The Officer winds up the letter by stating that from an inspection of the petitioner's records, it is found that there is abnormal delay in the changing of fused bulbs and delays ranging over a week are not rare; that cable joints and junction boxes are not marked and the cable routes are also not stated to be marked in many places. The Officer also states that the distribution system of the petitioner's undertaking is far from satisfactory. He then states that all these detects have been pointed out to the Engineer of the petitioner, Sri. Madhavan Nair and that he has promised to get those defects rectified immediately. Then the letter winds up with a notice to the petitioner intimating him that unless the said defects are rectified within a month from the date of receipt of the letter, the department will he constrained to take action against the petitioner.

18. The petitioner sends a reply, Ext. P-18 dated 10th April 1962. Therein he acknowledges the receipt of Ext. P-15. With regard to the low voltage at the various places mentioned therein, he gives an explanation to the effect that the said places are far olt from the point of his inward current supply and because of the fast developing outskirts of Kottayam Municipality, demands for current area increasing inordinately. The petitioner no doubt states that the increasing demands of current arc being attended to. He makes reference to the fact that at Kanjikuzhi the voltage is normal. He also refers to the circumstance that while a three-phase line has been extended to Manganam very recently in place of a single-phase lino, other places are being attended to. Then the petitioner expresses certain difficulties to the effect that the department must be aware of the fact that the supply Hues of the petitioner's undertaking are all copper and that the licensed area is full of ups and downs with narrow roads and lanes, and no high-tension overhead iine is possible to be installed.

According to the petitioner, for real and proper strengthening of the distribution mains, high grade copper wire and high-tension cables are necessary and that they are of late very difficult to procure. The petitioner states that he has made arrangements to giit both these materials and will he getting them in due course; and till that time temporary stop-gap arrangements are being made for giving proper current supply to the area in question. The petitioner also refers to the circumstance that the real strengthening will be done as soon as copper wires have been received by him and that a still better approach will be made when high-tension cables are got. Then the petitioner refers to the fact that in regard to the defects pointed out regarding poles, all the steel poles are being painted with aluminum and that that work is more than half over by that time and most of the ;other defects are all being attended to.

19. Then he refers to the fact that the Municipality is carrying on delaying tactics in the payment of charges and the members of the Council are carrying on an underground propaganda for raising and putting up false complaint against the licensee petitioner. He also states that the bills remain unpaid and litigation is pending for recovery of large outstandings from the Municipality. He states that 'under these conditions elaborate repairs are not enthusiased to be carried out with great vigour' and 'still urgent works are being attended to in order to have the lights burning on' and 'your suggestions in the line are taken up and being worked with great care.' He then refers to the fact that the citizens of Kottayam are more interested in getting the yield from the trees in their compound and protest against the cutting of the overhanging branches. Nevertheless, he assures the department, that exercising the licensee's rights, the cutting and removing of the overhanging branches are being daily attended to so as to have the specified clearance from his supply lines satisfactorily maintained.

The petitioner also refers to the fact that on receipt of copper wires the conductors at the fag end in Kanjikuzhi can he strengthened and that it is hoped that it may be done in a month, and weatherproof service lines of bad insulation are being replaced by new ones. The petitioner winds up this-communication by stating that all the items of work referred to by him are in progress and necessary instructions have been issued to his office to attend to all these maintenance works immediately. He also states that weather permitting, all the defects pointed out are expected to be rectified before the onset of the south-west mansoon. This communication, as we have already indicated, is dated 10th April 1962.

20. It will be seen from Appendix III to Ext. R-1 that after receipt of the communication from the petitioner, there was an inspection by the Superintending Engineer, Electrical, Ernakulam, who has sent his report dated 19-5-1962 to the Chief Engineer, Electricity. In the said communication the Superintending Engineer refers to instructions having been received from the Chief Engineer to check up the undertaking of the petitioner at Kottayam. He states that Oil 13-5-1962 itself the Executive Engineer, Pallom, informed the licensee over the phone that the Superintending Engineer will be going over to their office for collecting the details necessary. The Superintending Engineer further states that on 14-5-1992 he went over to the licensee's office with the Executive Engineer, Assistant Engineer and Junior Engineer, Pallom, and a Clerk from the Division Office, for checking un the voltage at various places as required by the Chief Engineer in his communication. The Superintending Engineer further states that the Engineer of the petitioner's undertaking was reported to be away on leave and the Assistant Engineer of the petitioner was also not available there; and so he met a person by name Gopinathan Nair, who is stated to be working as the Manager of the petitioner's undertaking. He was requested by the Superintending Engineer to depute one of his representatives for helping him in checking up the voltage at the various points and also to give their deposit register to the clerk to check up the deposits received by the licensee.

The Superintending Engineer further states that as he was found to be evading and dodging he went and saw the proprietor himself, Sri N. S. Mooss, the petitioner, and that he too expressed inability to give the deposit registers on the ground that many of them are not readily available and that those available registers cannot be easily found out. The impression that the Superintending Engineer appears to have cot from the attitude adopted by the petitioner as well as by his manager is that those persons will not co-operate and give any facilities for collecting the details regarding the checking up of voltage position and other particulars. Therefore the Superintending Engineer says that he was not able to verify the details referred to by the Chief Engineer in his communication. The Superintending Engineer further states that iff respect of the taking of voltage readings on some points, the petitioner appears to have deputed in the first instance one Shri Abraham to witness the voltage readings taken, but that gentleman also backed out in the end and refused to witness any of the readings recorded. The Superintending Engineer further refers to the fact that the range of maximum: minimum recording in the various places mentioned in the communication is only 170 volts and 260 volts and hence the actual voltage if any at any time beyond the said range could not Be ascertained. Ultimately the Superintending Engineer also gives a statement, marked as enclosure to Appendix III, wherein he gives as many as 8 places which were inspected by him as well as the recording o the voltage taken by him on 14-5-1982 and 15-5-1962.

21. There are two other communications, which passed between the 2nd respondent Board and the petitioner, namely Ext. P. 17 dated 13th August 1962 pointing out certain defects, as well as the reply sent by the petitioner Ext. P. 18 dated 17th August 1962. Ext P. 17 is a letter dated 13th August 1982 sent by the Secretary of the 2nd respondent Board to the petitioner. In that communication the Board refers to various complaints having been received regarding the supply of electricity by the petitioner to industries, essential services, Municipality, and other consumers in Kottayam. In particular, the 2nd respondent states that the Current supply failed on 30-7-1902 and that the petitioner did not take any effective action to resume normal supply within time and that he did not even inform the 2nd respondent Board's office at Pallom, nor did he take their assistance even when he found that it was impossible for him to cure the defects and resume the supply.

It is further stated that the Executive Engineer gave a temporary supply from 3-8-1962, and requested the petitioner to restrict the load til! permanent arrangements arc made. But the petitioner is alleged to have not taken any effective action and that the temporary supply also failed. The 2nd respondent further states that the petitioner has not kept sufficient stock of spare-parts etc., for the purpose of meeting emergencies and effecting repairs quickly. Therefore the 2nd respondent charges the petitioner with having failed in his statutory obligation to the public. In consequence the Board states that under Section 55 of the Supply Act, the petitioner is directed to achieve efficiency of the undertaking in its operation, by collecting the necessary cables and other materials and resume normal supply within three days from the date of receipt of the letter; otherwise, the 2nd respondent states, that action would be taken under Section 77 of the Supply Act.

22. The petitioner sends a reply to the 2nd respondent Board under Ext. P. 18 dated 17th August 1962. He requests the Board to forward to him copies of the complaints referred to in their letter Ext. P. 17. He further states that he is doing his best in the matter of distribution of electricity in the area. Ho also refers to the fact that there have been some breakdowns in the supply of energy in some parts of the town, but that it was due to unavoidable circumstances. The petitioner also refers to the cutting of trenches for laying water pipes and therefore the cable line must have got damaged. He also states that intermittent breakdowns could not be avoided under those circumstances. He next refers to the suit instituted by him against the National Tyre and Rubber Co. of India Ltd., Kottayam, as well as the suit instituted by that company as against him. He also refers to the fact that the rubber company had approached the 2nd respondent for direct supply and that the 2nd respondent had also agreed to give such supply. Such a procedure, according to the petitioner, is really injurious to his interests. He further states that inasmuch as the Managing Director of the Rubber company is a member of the 2nd respondent Board, the petitioner has an apprehension that his claims do not receive as much altention at the hands of the Board as it should otherwise receive.

Then the petitioner refers to a request made by him to the Board to give certain additional points and the Board having given such points within the premises of the Rubber company itself, which, he alleges, was deliberately damaged by the said company. Then he refers to the fact that that he has got all the materials in stock and that he is in short supply of high tension cables to meet extraordinary em urgencies and that he is making elforts to get them as quickly as possible. After much elfort he claims to have obtained about 2000 yds. of cable from Belgium which have been rushed from Madras tor the purpose of effecting the necessary repairs and he assures the Board that the necessary repairs will be effected very shortly and that the reasonable directions issued by the Board will be complied with.

23. The 1st respondent State, appears to have received several complaints regarding the working of the petitioner's undertaking, and they directed the Chief Engineer, Electricity, and Electrical inspector to Government, to examine the undertaking of the petitioner and send a report. Ext. R. 1 dated 28-5-1062 is the report of the said officer, and several enclosures have also been sent by him along with the said report to the State Government. The officer has also sent a copy of the report to the 2nd respondent Board. In Ext. R. 1 he refers to various matters culminating in the inspection by the Superintending Engineer on 19-5-1062 of the petitioner's undertaking, and states that there is low voltage in several places notwithstanding the fact that action was directed to be taken from 1959 onwards. The Chief Engineer also refers to certain hard and rigorous conditions of supply that were being insisted upon by the petitioner on the consumers. According to the Chief Engineer, that is violitive of Clause V of the schedule to the Act. The existence of low voltage, according to the Chief Engineer, is again contrary to the provisions contained in Rule 54 of the Indian Electricity Rules, 1956.

The Chief Engineer also refers to certain other matters, namely of his having called upon the petitioner to desist from such acts, as well as the evasive replies of the petitioner, the Chief Engineer also refers to the want of co-operation on the part of the petitioner, as well as the inability of the petitioner to produce a valid license when called upon by him. Several irregularities of the manner in which accounts are to be maintained by the petitioner are also referred to by the Chief Engineer in Ext. R. 1. Ultimately he states that vcrv many of the matters referred to by him in his report Ext. R1 will clearly show that the petitioner has committed wilful and unreasonably prolonged default in respect of the various matters which arc required of the petitioner by or under the provisions of the Act.

24. On receipt of the communication Ext. R1 from the Chief Engineer, the State Government sent Ext. R2 to the 2nd respondent Board on 21-6-1962. The State Government in that communication, after referring to the numerous complaints that they have received regarding the unsatisfactory working of the petitioner's undertaking, from various individuals as well as organisations, and also referring to their having asked the Chief Engineer, Electrical, to conduct a detailed inquiry regarding the working of the said system, and after adverting to the report dated 28-5-1962 (Ext. B1) received from the Electrical Inspector, pointing out the various irregularities and violation of the statutory provisions, state that from the report it is seen that the licensee is making wilful and unreasonably prolonged default. Tile State Government, in the circumstances, express the view that they consider that the license granted to the petitioner should he revoked under Section 4(1)(a) of the Act. The State Electricity Board was requested to consider this aspect and to send its considered views to the Government at an early date.

The 2nd respondent Board sent the reply Ext. R3 dated 26th July 1962 to the State Government. After referring to Ext. R.2, the Board state that they endorse the view of the Government on the matter and recommend the revocation of the license granted to the petitioner by invoking Section 4(1)(a) of the Act. The State Government, on the basis of this recommendation received from the Electricity Board, sent Ext. P1 dated 17-8-1962, to the petitioner, under Section 4(3) of the Act. In Ext. P1, the State Government, after referring to what according to them are violation of the various conditions imposed by the license granted under the Act, call upon the petitioner to show cause as to why the license should not be cancelled under Section 4(1)(a) of the Act.

Broadly, it may be stated that Ext. P1 contains six charges as against the petitioner. Charge No. 1, which consists of three sub-items, refers to the petitioner not having taken action within the period and as required in Exts. P20 P23 and P15, to which we have already referred. Charge No. 2 relates to the hard and rigorous conditions, which according to the Government the petitioner is imposing on the consumers and which he is not entitled to. Charge No. 3 is to the effect that the petitioner has not been co-operating with the Electrical Inspector or his nominees in the discharge of his duties. Charge No, 4 refers to the non-production of a valid licence on demand by due notice, or to make available his current license in respect of his undertaking in Kottayam, Charge No. 5 consists of nearly six sub-items, and it particularly refers to the manner in which the petitioner is keeping the accounts. Under this charge, according to the State Government, the accounts are not being kept by the petitioner in the manner required of him. Charge No. 6 relates to the fact that there has been continuous failure of current in some of the main lines within the supply area of the petitioner, and that the petitioner has not cared to restore the supply for want of adequate stock of cables and that several complaints have been received from the authorities mentioned therein.

Ultimately the State Government wind up Ext. P1 by calling upon the petitioner to show cause, why his license should not be revoked under Section 4(1)(a) of the Act on the grounds mentioned in Ext. P1. The petitioner was also directed to send his explanation within 3 months and 3 days from the date of receipt of the notice Ext. P1

25. There is no controversy that the petitioner did send a fairly elaborate reply under Ext. P. 19 dated 5th November 1962. He begins Ext. P. 19 by stating that Sections 4 and 5 of the Act are unconstitutional and violative of the fundamental rights of the petitioner as the licensee. He also states that the State Government have no jurisdiction, as it has purported to do, by issuing Ext. P1, to take any action on the basis of those provisions. The petitioner, after recording his protest to the jurisdiction of the State Government to take action, and subject to those objections, deals with the various matters that have been referred to under the various heads of charges specified in Ex. P1.

26. The petitioner states that the averment that the voltage is very low in several places in the distribution area is absolutely erroneous. He also refers to the correspondence that passed between him and the department evidenced by Pxt. P20, as well as the final minutes recording the arrangement entered into under Ext. P2S, and to his having intimated the department about completing the works by Ext. P25 dated 13-8-1960. Even in respect of the further communication Ext. P15, he has already sent a reply under Ext. P16, and that after receipt of Ext. P18 no further defects have been pointed out by the authorities concerned. Hence he states that no action can be taken against him on the basis of charge No. 1. About charge No. 2, he states that inasmuch as it is a very vague and general allegation and particulars are not given, he is not in a position to offer any explanation; and in any event, those matters mentioned in the charge will not give jurisdiction to the State Government to take action under Section 4(1)(a) of the Act.

Regarding charge No. 3, the petitioner states that the allegation is untrue and unwarranted; on the other hand, he says that ho was always co-operating with the departmental authorities and complying with the directions given by them. Regarding the non-production of license, which is the subject of charge No. 4, the petitioner states that the department is well aware of the fact that he has got the rights of his father by assignment and that the assignment in his favour has been recognised and the license has been published in the State Gazette. Therefore, according to the petitioner, this charge is absolutely frivolous. Regarding the manner in which accounts are stated to have been maintained by the petitioner, which forms the subject of charge No. 5, the petitioner refers to the fact that he has been keeping the accounts according to the Malayalam era and that he is entitled to do so under the provisions of the Travancore Electricity Rules under which the license was granted to him. Then he refers to the manner in which the accounts are being kept which, according to him, are regular and in accordance with the provisions of the Act. In any event, the petitioner states, no objection has been raised by the department to the manner in which the accounts are being kept by him. He also refers more or less in detail to the various sub-items mentioned in charge No. 5.

In particular, regarding the allegation contained in sub-item (v) in charge 5 in respect of payment of bonus given prior to 1956, the petitioner states that the said payment does not require Government sanction at all. In this connection he refers to the provisions contained in Schedule VI (2)(xiii)(b) of the Supply Act. Sanction became necessary only after 1-4-1957. But according to the petitioner, even payment of bonus after the date of the Supply Act, was being made in accordance with the award of the Industrial Tribunal which is authorised by Schedule VI (2) (a), in which case the provision in Schedule VI (2) (xiii) (b) requiring Government sanction does not come into the picture at all, and there was no necessity for obtaining sanction in respect of such payment. Regarding the breakdown in the supply which is the subject of charge No. 6 in Ext. P1, the petitioner refers to the communication received from the Electricity Board on 13-8-1962, Ext. P17, and reply sent by him on 17-8-1962, Ext. P18. The petitioner states that even before the Electricity Board could consider the reply dated 17-8-1962, on the same date the State Government have issued the notice Ext. P1 to him initiating action under Section 4(1)(a) of the Act, by issuing notice under Section 4(3) of the Act. Ultimately the petitioner states that all the charges are unfounded and that no action can be taken as against him as contemplated by the Government in their notice Ext. Pf. He also refers to certain difficulties experienced by him in the matter of getting supply of various items which are necessary for the proper conduct of the undertaking. In spite of these difficulties and drawbacks the petitioner states that he has been making a very serious and strenuous effort to obtain the materials at very groat inconvenience and high cost and he has been trying to keep the undertaking going in the best manner possible.

The petitioner than refers to the fact that the 2nd respondent, namely the Electricity Board, is taking an active interest in some of the consumers within the jurisdiction of the petitioner's distribution system. The petitioner also states that the Electrical Inspector, who is none else than the Chief Engineer to the Kerala State Electricity Board, has been very often supporting the stand taken by consumers who have been opposing the petitioner and who have committed default in the payment of arrears due to him. In particular, the petitioner refers to the attitude of the National Tyre and Rubber Co. of India Ltd., as well as the writ petition filed in this Court as O. P. No. 475/1961 challenging certain directions given by the Electrical Inspector in favour of the said rubber company. The petitioner then refers to the nomination o Sri P. C. Abraham, who was the Managing Director of the National Tyre and Rubber Co., as a member of the Kerala State Electricity Board on 1st April 1962, and the petitioner is of the view that he has become the target of unmerited charges at the hands of interested parties. The petitioner also states that the various aspects referred to by him will clearly show that the Kerala State Electricity Board and the Electrical Inspector, who is also the Chief Engineer, on the basis of whoso report, Government appear to have initiated action against him, have already made up their minds to revoke the licence for any available reason. Therefore the petitioner ultimately requests the State Government to drop the proceedings, But the petitioner states that if after considering the preliminary question of jurisdiction of the Government to initiate action against him under Section 4(1), the Government decide to conduct an inquiry into the allegations, by taking oral and documentary evidence which the petitioner is prepared to adduce, if an opportunity is given to him. (sic). For that purpose, he requests the Government to fix a day for hearing not only regarding the jurisdiction of the Government but also to give him an opportunity to substantiate the various matters referred to in Ext. P19.

27. After receipt of Ex. P19, the State Government, obviously was not satisfied with the explanation offered by the petitioner. They sent the communication Ext. R4 dated 6th April 1983, under Section 5(1)(b) of the Act, to the State Electricity Board, viz., the 2nd respondent, requesting them to let Government know as to whether tne Electricity Board is willing to purchase the petitioner's undertaking. In the said communication the State Government, after referring to. Ext. R2 as well as the reply of the Electricity Board Ext. R3, state that Government have considered the explanation Ext. P19 dated 5-11-1962 furnished by the petitioner to the show cause notice Ext. P1 dated 17-8-1962, and they are of the view that the explanation is not satisfactory, and therefore, Government in public interest have decided to revoke the licence granted to the petitioner's undertaking under Section 4(1) of the Act. The State Government finally asks the Electricity Board to express their willingness or otherwise regarding the purchase of the undertaking, under Section 5(1)(b) of the Act. To this communication the 2nd respondent Board sends a reply Ext. R5 dated 20th April 1963, wherein the Board informs the State Government that the Board is willing to purchase the undertaking from the Kottayam Electric Supply Agency, and they also suggest that the date for delivering the undertaking to the Board may be specified as 1st August 1963.

28. It is after the receipt of Ext. R5, from the 2nd respondent, that the two orders Exts. P2 and P3 were passed by the State Government on 17th May 1963. Exhibit P2 is an order passed under Section 5(1)(a) of the Act, stating that the license in favour of the petitioner is revoked and that the revocation will take effect from 1st August 1963. In this communication, the Government, after referring to the issue of the show cause notice Ext. P1 under Section 4(3) of the Act, and also after referring to the explanation given by the petitioner Ext. P19, state that they are of opinion that the explanation is not satisfactory or acceptable. It is also stated that in the opinion of the Government, public interest requires the revocation of the license of the petitioner. Therefore Ext. P2 further states that in exercise of the powers conferred by Section 5(1)(a) of the Act the State Government give notice to the petitioner that the license granted to the petitioner's undertaking will be revoked and they fix 1st day of August 1963 as the date on which the said revocation shall take effect. On the same date, viz., 17th May 1983, the Sfato Government issued another notice, Ext. P3, to the petitioner, wherein, after referring to Ext. P2 and also referring to Ext. P4 asking the willingness of the Electricity Board to purchase the undertaking, and Ext. R5 wherein the Board has expressed their willingness to so purchase the undertaking, the State Government direct the petitioner, by virtue of the powers conferred on them under Section 5(1)(c) and Section 5(3) of the Act, to sell and deliver possession of the said undertaking to the 2nd respondent Board on or before the 1st day of July 1963. Therefore, it will be seen that the effect of the two orders, Exts. P 2 and P 3, is the revocation of the license granted to the petitioner's undertaking for the supply of electrical energy in the area concerned, and directing the petitioner to sell the undertaking to the 2nd respondent Board.

29. Before we advert to the contentions that have been taken by Mr. K. V. Surianarayana Iyer, learned counsel for the petitioner, as well as the stand taken by the learned Advocate General on behalf of the State Government--which stand has been supported by Mr. G. R. Menon, learned counsel appearing for the 2nd respondent State Electricity Board--this will be a convenient stage to refer to the material provisions contained in Sections 4 and 5 of the Act. Section 4 of the Act deals with revocation or amendment of licenses. Section 4(1) is as follows :

'4. (1) The State Government may, if in its opinion the public interest so requires and after consulting the State Electricity Board, revoke a license, in any of the following cases, namely :--

(a) where the licensee, in the opinion of the State Government, makes wilful and unreasonably prolonged default in doing anything required of him by or under this Act;

(b) where the licensee breaks any of the terms or conditions of his license the breach of which is expressly declared by such license to render it liable to revocation;

(c) where the licensee fails within the period fixed in this behalf by his license or any longer period which the State Government may substitute therefor by order under Section 4A, Sub-section (1), and before exercising any of the powers conferred on him thereby in relation to the execution of works,---

(i) to show, to the satisfaction of the State Government, that he is in a position fully and efficiently to discharge the duties and obligations imposed on him by his license, or

(ii) to make the deposit or furnish the security required by his license;

(d) where in the opinion of the State Government the financial position of the licensee is such that he is unable fully and efficiently to discharge the duties and obligations imposed on him by his license;

(e) where a licensee, in the opinion of the State Government, has made default in complying with any direction issued under Section 22A.'

The various grounds under which the State government can revoke a license are enumerated in Clauses (a) to (d) of Sub-section (1) of Section 4, Sub-section (8) of Section 4 provides that

'No license shall he revoked under Sub-section (1) unless the State Government has given to the licensee not less than three months' notice, in writing, stating the grounds on which it is proposed to revoke the license and has considered any cause shown by the licensee within the period of the notice, against the proposed revocation.'

Section 5 of the Act deals with the provisions, which are applicable where the license of a licensee is revoked, under Section 5, it is provided that whore the State Government revokes, under Section 4, Sub-section (1), the license of a licensee, the provisions mentioned in the various clauses of Sub-section (1) shall have effect. In particular, Clause (a) of Sub-section (1) of Section 5 is as follows:

'5. (1) * * * * *

(a) The State Government shall serve a notice of revocation upon the licensee and shall fix a date on which the revocation shall take effect; and on and with effect from that date, or on and with effect from the date, if earlier, on which the undertaking of the licensee is sold to a purchaser in pursuance of any of the succeeding clauses or is delivered to a designated purchaser in pursuance of Sub-section (3), all the powers and liabilities of the licensee under this Act shall absolutely cease and determine;

* * * *'

The further procedures to be adopted by the State Government are indicated in the subsequent clauses of Sub-section (1). We are only concerned in this case with Clause (b) of Sub-section (1) of Section 5, wherein it is provided that the State Government shall inquire from the Stale Electricity Board whether it is willing to purchase the undertaking. Under Clause (c), it is provided that if the State Electricity Board is willing to purchase the undertaking, the State Government shall, by notice in writing, require the licensee to sell, and that thereupon the licensee shall sell the undertaking to the Board.

30. It is by virtue of these provisions that action has been taken by the State Government revoking the license granted to the petitioner's undertaking under Section 4(1)(a), and directing the petitioner to sell the undertaking to the 2nd respondent under Section 5(1)(c) of the Act. We will have to refer at a later stage to certain other provisions in Section 5, as also in Sections 6 and 7A of the Act, when we deal with the contention raised by the learned counsel for the petitioner, that Sections 4 and 5 of the Act are violative of the fundamental rights guaranteed to the petitioner under Articles 14 and 19(1) (f) and (g) of the Constitution and so they have to be Struck down.

31. Mr. Surianarayana Iyer, learned counsel for the petitioner, raised four contentions, viz.,

(1) Sections 4 and 5 of the Ace are violative of the fundamental rights guaranteed to the petitioner under Articles 14 and 19(1) (f) and (g) of the Constitution, and therefore void ;

(2) The State Government, when it exercises the power of revoking a license under Section 4(f) of the Act, exercises quasi-judicial functions, and it must give reasons for the conclusions that have been arrived at by it for cancelling the license. In consequence, according to the learned counsel, an opportunity should have been given to the petitioner to support, by adducing evidence, the explanation given by him under Ext. P 19. In short, the contention of the learned counsel is that the opinion that is formed by the State Government for revoking a license is an objective one which could be reviewed by Courts. It is the further contention of the learned counsel that on the basis oE the materials on record in this case, no reasonable tribunal or authority can come to a conclusion that the petitioner can he considered to have committed any default--much less wilful and unreasonably prolonged default. A minor contention under this head has also been raised by the learned counsel to the effect that the order of revocation, Ext. P2, does not refer to any finding by the State Government on this aspect.

(3) In passing the two orders in question, viz,, Exts. P2 and P3, very many irrelevant matters, referred to in Ext. P1, must have been taken into account by the State Government. Therefore, inasmuch as it is not possible to say as to which of the grounds referred to in Ext. P1 has operated in the mind of the State Government to take a decision for revoking the petitioner's license, the orders passed by the State Government have to be struck down; and

(4) the fourth and the last contention taken by the learned counsel for the petitioner is that the exercise of power by the State Government revoking the license of the petitioner, is mala fide and is a fraud on the powers vested in it under Section 4 of the Act.

32. On the other hand, the learned Advocate-General on behalf of the State Government, has controverted the stand taken by Mr. Surianarayana Iyer, learned counsel for the petitioner, in respect of the four grounds of attack as against the proceedings impugned in this case. According to the learned Advocate-General, the provisions contained in sections 4 and 5 of the Act are valid and do not infringe any fundamental rights of the pefitioner. Even otherwise, inasmuch as the exercise of such power is in the paramount interest of the general public, it must be considered to be a reasonable restriction under Article 19, Clauses (5) and (6) of the Constitution, the contention of the petitioner that those provisions are discriminative and violative of Article 14 of the Constitution, is, according to the learned Advocate General, equally not well founded. The learned Advocate General also took up the position that the formation of an opinion by the State Government, as contemplated in Section 4 of the Act, is essentially a subjective opinion to he formed by the State Government on the materials before it, and the correctness or otherwise of the opinion so formed cannot be canvassed by the petitioner before this Court in proceedings under Article 229. The only conditions precedent, according to the learned Advocate General, for revoking the license are those mentioned in the Section itself; and once an opinion has been formed by the State Government in accordance with the provisions of the said Section, it cannot be challenged by the petitioner.

The learned Advocate-General also urged that Ext. P2 cannot be considered to be defective on the ground that there is no recital in the said order that the petitioner is guilty of wilful and unreasonably prolonged default. The learned Advocate-General pointed out that the materials placed before tins Court by the State and the statements made in the counter affidavit filed by it will clearly show that the State Government has considered all aspects and that it has formed the opinion as required by Section 4(1)(a) of the Act. The learned Advocate-General also urged that unless this Court is of the view that there was no material whatsoever before the State Government, on the basis of which such an opinion could have been formed by it as required by Section 4(1)(a) of the Act, or that the exercise of the power by the State Government is mala fide or fraudulent, this Court will not interfere with the orders which are under attack.

33. The learned Advocate General also pointed out that no irrelevant consideration has been taken into account by the Government when they formed the opinion for revoking the license of the 'petitioner under Section 4(1)(a) of the Act. In any event, the learned Advocate-General pointed out that even if any of the grounds mentioned in Ext. P1 is found ultimately to have been not proved, the order of revocation cannot be struck down on that sole ground. In fact, according to the learned Advocate General, every one of the charges enumerated in Ext. P1 is substantiated by the materials on record and which were available to the State Government. The learned Advocate General also urged that the contention of the learned Counsel for the petitioner that the exercise of the power of revocation of license by the State Government is mala fide, is not borne out even by the averments of the petitioner himself in his affidavit. The learned Advocate Genera! pointed out that the opinion that has to be formed under Section 4 of the Act, is the opinion of the State Government; and no allegation whatsoever has been made by the petitioner in his affidavit or in any other proceedings, attributing any mala fides as against the State Government. Even the allegations made as against the 2nd respondent are also equally devoid of any merit, In particular, the learned Advocate General pointed out that the various proceedings will show that even from 1955 there were various defects existing in this undertaking and that they continued to exist even as late as 19-5-1982 when the Superintending Engineer inspected the undertaking of the petitioner. On all these grounds, the learned Advocate-General, urged, there is absolutely no scope for interference with the orders impugned.

34. At the outset, it must be stated that Mr. Surianarayana Iyer, learned counsel for the petitioner, has not taken before us any contention that the charges in Ext P1 relate to any matter which the petitioner is not required to do by or under the provisions of the Act. We are particularly referring to this aspect because it has become necessary for us to consider, by reference to the provisions of the Act and the rules, as to what a licensee is required to do by or under the Act.

35. Before we take up the second contention raised by Mr. Surianarayana Iyer, learned counsel for the petitioner, namely as to whether the State Government when exercising powers under Section 4 of the Act, are exercising quasi-judicial functions, or whether the opinion that is formed is subjective or objective, we will deal with contentions Nos. 1, 3 and 4 set out above.

36. The first contention of Mr. Surianarayana Iyer, is that Sections 4 and 5 of the Act are violative of the fundamental rights guaranteed to the petitioner under Articles 14 and 19(1)(f) and (g) of the Constitution. The charge of discrimination under Article 14 is based upon the provisions contained in the Act regarding the mode in which the market value is to be paid in respect of an undertaking when action is taken by way oi revocation of the license under Section 4 and there is to be a sale under Section 5 of the Act, and to the different method of valuation which is to be adopted in respect of an undertaking which is purchased by the exercise of option under Section 6 of the Act. In particular, the learned counsel for the petitioner pointed out that there is discrimination inasmuch as the petitioner, when the sale rakes effect by virtue of the order Exts. P 2 and P 3, is deprived of getting an additional amount up to 20% over and above the market value, which the petitioner would have got, had the license been allowed to continue, and the option to purchase has been exercised after 17 years by the appropriate authority.

37. In this connection the learned counsel referred to some of the provisions contained in Sections 5, 6 and 7A of the Act. Section 5(2) provides that where an undertaking not belonging to a local authority is sold under Section 5(1), the licensee is to be paid the purchase price determined in accordance with Sub-sections (1) and (2) of Section 7A. Section 8 deals with purchase of undertakings on the basis of exercise of option. Sub-section (7) of Section 9 provides that where an undertaking is purchased under this Section, the purchaser shall pay to the licensee the purchase price determined in accordance with the provisions of Sub-section (4) of Section 7A. Section 7A relates to determination of purchase-price. Sub-sections (1) and (2) of Section 5 provide as to how exactly the market value of the undertaking is to be computed in respect of an undertaking which is to be sold under Section 5(1) of the Act. There can he no controversy that even in respect of an undertaking which is purchased by exercise of the option under Section 6, as provided under Sub-section (4) of Section 7A, the purchase price shall be the value as determined as per Sub-sections (1) and (2) of Section 7A. But in respect of such undertakings, by virtue of the proviso to Sub-section (4) of Section 7A the licensee will got an additional amount, not exceeding 20%, on the value, on account of compulsory purchase. That proviso does not apply to a case of sale under Section 5(1). Therefore, the difference in the matter of computation of the market value between an undertaking which is purchased by exercising the option under Section 6, and an undertaking which is directed to be sold under Section 5, consists in the fact that in the latter class of cases the licensee is not given a right to anything over and above the market value fixed under Sub-sections (1) and (2) of Section 7A. That is, in short, he does not get the benefit of the proviso to Sub-section (4) of Section 7A. The question is whether this amounts to discrimination, so as to offend Article 14 of the Constitution.

38. No doubt Mr. Surianarayana Iyer, learned counsel for the petitioner, referred us to the decision of the Supremo Court reported in K. T. Moopil Nair v. State of Kerala, AIR 1981 S C 552 wherein the Land Tax Act which was in force in Kerala was struck down. In that case, the said enactment was challenged both on the ground of violation of Article 14 as well as oE Article 19(1)(f) and (g) of the Constitution,

39. In our view, the principles laid down in that decision have no application to the case on hand. In this case, the statute makes a broad distinction in the matter of computation of the value where an undertaking is purchased by virtue of option on the one hand, and of undertakings which are to be sold under Section 5(1) on the license being revoked under Section 4(1). So far as we could see, among, persons similarly situated like the petitioner in this case, if the revocation is valid no discrimination, has been made in the matter of payment of value, because to all cases ot revocation the same principles will apply. In this connection, it is necessary to refer to the decision of the Supreme Court reported in State of Madhya Pradesh v. Bhopal Sugar Industries AIR 1984 S C 1179. That case arose under the Bhopal State Agricultural Income tax Act, 1953. In that case it will be seen that the State of Bhopal, when it was a separate State, had passed an Act levying tax on agricultural income. Later on, the said State formed part of the bigger State of Madhya Pradesh; and, in the remaining area of the new State, admittedly there was no legislation levying a tax on agricultural income. Therefore, a contention was taken that there is discrimination between persons resident in the erstwhile Bhopal State and persons residing outside the Bhopal area, in the matter of payment of agricultural income tax. That aspect is discussed by the Supreme Court. Shah, J., fit p. 1183 of the report, observes that an applicant pleading that equal protection of the laws has been denied to him must make out that not only he had been treated differently from others, hut he has been so treated from persons similarly circumstanced without any reasonable basis, and such differential treatment is unjustifiably made. Pausing here for a minute, it will be seen that according to the observations of the Supreme Court in that case, in order to sustain a plea of discrimination based upon Article 14, a party will have to satisfy the court about two things, namely (1) that he had been treated differently from others, and (2) that by has been differently treated from persons similarly circumstanced, without any reasonable basis. Applying this test, the question is, is it possible to accept the contention of the learned counsel (or the petitioner in this case that the provisions in the Act, regarding the computation of market value when an undertaking has to be sold under Section 5(1), offend Article 14 ?

40. In our opinion, the contention of the learned counsel for the petitioner based on Article 14 cannot certainty be accepted. We have already pointed out that in the Act there is a broad distinction between persons whose undertakings are purchased by virtue of the option, and persons whose undertakings are to be sold by virtue of the revocation of the license. There is the further fact that among persons similarly situated like the petitioner, namely whose undertakings are directed to be sold, after revocation of the license, no discrimination at all is made. Obviously the Legislature did not want the licensee whose license is revoked under Section 4(1) to be placed on a par, in the matter of payment of additional amount upto 20%, with licensees whose undertaking is compulsorily purchased by exercise of option. Being a compulsory purchase, this additional amount is a solatium. Otherwise a licensee can commit wilful default and force the Government to fake action under Section 5 (1) and claim full compensation. That is not the intention of the Legislature and the distinction is based on a rational basis. Therefore, the contention of Mr. Surianarayana Iyer that Sections 4 and 5 of the Act are violative of Article 14 cannot be accepted.

41. Then the further question is whether Sections 4 and 5 of the Act violate Article 19(1) (f) and (g) of the Constitution. According to the learned counsel, there is violation of Article 19(1) (f) and (g) because of the following circumstances. A very arbitrary and unrestricted power is vested in the Stale Government to cancel or revoke licenses of persons who must have invested large capital in the running of their undertakings on the basis of licenses granted to them. As to how exactly that power is to be exercised, or as to what are the guiding factors, is not indicated in the Act. As to what procedure the State Government is to adopt before deciding to revoke the license, is also not indicated in the Act. The learned counsel also pointed out that there is no provision in the Act giving a right to a party aggrieved by the act of the State Government in the matter ot revocation, to either lake it in appeal or challenge the same before Courts. In short, the learned counsel urged that valuable rights of a licensee can be terminated by an arbitrary and capricious act of the Government under Sections 4 and 5 of the Act. Mr. Surianarayana Iyer placed considerable reliance again on the decision of the Supreme Court reported in AIR 1961 S C 552 striking down the Land Tax Act, which was in force in this State.

42. This stand taken on behalf of the petitioner, is very strenuously controverted by the learned Advocate General. According to him, the power that is vested under Sections 4 and 5 of the Act, is not in any subordinate authority, but the highest executive authority in the State, namely the State Government. He also pointed out that the power that has been vested in the State Government is really in order to achieve the purpose for which the Act itself has been passed, namely being a law relating to the supply and use of electrical energy. The contention that the State Government can act arbitrarily or capriciously as there is absolutely no indication in the statute as to the grounds under which the State Government can take action, or the matters which are to be taken into account by the State Government before deciding to revoke the license, the learned Advocate General painted out is also not well founded, because a reading of Section 4(1) itself will clearly show that the statute has very carefully circumscribed and placed limitations on the exercise of the power by the State Government. The learned Advocate General pointed out that the State Government, before it takes action under Section 4, must form an opinion that in the public interest the revocation of the license is necessary. Provision is made for consulting the State Electricity Board, which is a responsible statutory body. The revocation, as in this case, under Section 4(1) (a) can he done only when the Stale Government further forms an opinion that the licensee has made wilful and unreasonably prolonged default, in doing anything required of him by or under the Act.

More than all this, the learned Advocate-General pointed out that a further sufficient safeguard hits been provided by Sub-section (3) of Section 4, making it mandatory on the part of the State Government to issue a notice in writing to the licensee and giving him necessary time mentioned therein, setting out the grounds on which it proposes to revoke the license, and also to consider any cause that may have been shown by the licensee. Therefore, the learned Advocate General pointed out that all these circumstances will clearly show that there is absolutely no infringement of any of the rights guaranteed to the petitioner under Article 19(1)(f) or (g). In any event, the learned Advocate General pointed out, inasmuch as the exerpise of the power is really in the interest of the public, any restriction must be considered to be a reasonable restriction which is saved under Article 19 (5) and (8) of the Constitution. Apart from the fact that there is no exclusion of jurisdiction of the civil Court in the Act either expressly or impliedly, the learned Advocate-Genera! pointed out that even in cases of statutes, where the jurisdiction of the Courts to question a decision taken by particular authorities is barred or did not contain any provision giving right of appeal, nevertheless such statutes have been held to be valid by the Supreme Court in several decisions.

43. In this connection the learned Advocate General referred to the observations of Venkatarama Aiyar, J., in the decision reported in Lachhman Dass v. State of Punjab, AIR 1963 S C 222 at p. 236, The learned Judges in that case, apart from various other matters, had to consider particularly the validity of the provisions contained in Section 11 of the Patiala Recovery of State Dues Act. Section 11 of the said Statute has been referred to at p. 227 of the report. It is to the effect that no civil court shall have jurisdiction in respect of any matter which under the Act or the rules is entrusted to the Head of Department or any authority or officer authorised by him. Those provisions will clearly show that the jurisdiction of the civil court has been completely barred. It was contended before the Supreme Court that as Section 11 of the said Act completely barred the jurisdiction of the civil courts with reference to the disputes triable under the Act, that is unreasonable, and so the Act must be struck down, Venkatarama Aiyar, J. dealing with this aspect at p. 236 of the report, observes :

'It is too late in the day to contend that provisions in statutes creating a special jurisdiction and taking away the jurisdiction of civil Courts in res-pest of matters falling within that jurisdiction are unreasonable, or opposed to rules of natural justice. It has only to he remembered that provisions excluding the jurisdiction of civil Courts in such cases do not affect the jurisdiction of either the High Court under Article 226 or of this Court under Article 32 to interfere when grounds therefor are established.'

From the observations extracted above it will be seen that the Supreme Court has taken note of the fact that there are several statutes whereunder special jurisdiction has been given to authorities functioning thereunder and has taken away the jurisdiction of Courts in respect of such matters, and nevertheless those statutes have not been held to be unreasonable. In any event, the Supremo Court has expressed the view that even if the jurisdiction of the civil Courts has been specifically barred by such statutes, that does not afreet the jurisdiction oi the High Court under Article 229 or of the Supreme Court under Article 32, to interfere in proper cases.

44. There is an earlier decision ot the Supreme Court, reported in Messrs D. S. & G. Mills v. The Union of India, A I R 1959 SC 626. In that case, Wanchoo J., had to consider the question as to how far a notification issued by the Central Government, fixing the price and regulating the sale of sugar under the Essential Commodities Act, 1955, is vaild. It will be seen that the provisions in question conferred power on the Central Government to issue notification regarding the fixation of the price anil sale of sugar to particular persons under the Essential Commodities Act, 1955. In accordance with that power the Central Government issued a notification under the Sugar Control Order, 1955. One of the contentions that was raised before the Supreme Court was that the power that has been conferred on the Central Government is arbitrary, aod therefore the notification is beyond the authority conferred on the Central Government and that the provisions conferring such power, on the basis of which the impugned notification was issued by the Central Government, will have to be struck down. In dealing with this aspect, the contention is noted at p. 631 of the report, to the effect that there is an unreasonable restriction imposed on a party's right to carry on trade under Article 19(1)(g). The Supreme Court deals with this aspect at p. 632 and states that the argument that there is no reasonable safeguard against the abuse of power and no check by way of appeal or otherwise is provided against the order of the Central Government, can he disposed of on the ground that the power vested in the Central Government to fix the prices under the Act in question is in the interest of the general public; and that, under these circumstances, it is absurd to expect that there would be some provision by way of appeal or otherwise against the exercise of the power by the Central Government.

The Supreme Court further states that so long as the Central Government exercises its power in manner provided by the Act and the Order, it cannot certainly he said that any safeguard is necessary in the form of an appeal or otherwise, and that safeguards have been provided in Clause 5 of the Sugar Control Order. The Supreme Court also states that before issuing a notification, the Central Government must consider the relevant factors mentioned in the said clause, and those factors mentioned in the Statute itself provide a sufficient check on the power of the Central Government, if it is ever minded to abuse the power, On this basis, the Supreme Court rejected the contention that the notification issued by the Central Government, even when there was no right to challenge the same by way of appeal or otherwise is opposed to Article 19(1)(g) . The Supreme Court held that the impugned notification is not an unreasonable-restriction on the petitioner's right to carry on trade under Article 19(1)(g).

We may also refer to the decision of the Supreme Couit reported in Joseph Kuruvilla Vellukunnel v. Reserve Bank of India, A I R 1962 S C 1371. Hidayatullah J. speaking for the Court, refers to the decision of the Supreme Court in AIR 1961 S C 552 relied on by Mr, Surianarayana Iyer and certain other decisions of the Supreme Court, and observes at p. 1387 :

'The appellant also relied upon AIR 1961 S C 552 where a taxing statute was struck down on the ground that it provided no procedure for assessment of the tax, Abdul Hakim v. State of Dihar, AIR 1991 S C 448 and State of Madhya Pradesh v. Baldeo Prasad, AIR 1961 S C 293; but they do not deal with the point now raised, and were decided on facts which were entirely different. It will thus be seen that the wide proposition, that every determination affecting liberty, rights or property must always be made by a judicial tribunal and none else, does not find support from the cases above considered.'

45. The contention of Mr. Surianarayana Iyer will have to be considered in the light of the various matters provided in Sections 4(1) and 5 of the Act, having due regard to the decisions of the Supreme Court referred to above.

46. But before referring to the actual provisions of the Act, we must advert to another decision relied on by Mr. Surianarayana Iyer, namely the decision of the Supreme Court reported in Corporation of Calcutta v. Calcutta Tramways Co. Ltd., AIR 1994 S C 1279. The Supreme Court in that case had no doubt to consider the scope of Clause (b) of Sub-section (1) of Section 437 of the Calcutta Municipal Act, wherein it is provided that 'any purpose, which is, in the opinion of the Corporation (which opinion shall be conclusive and shall not be challenged in any Court) dangerous to life, health, or property, or likely to create a nuisance.' The learned Judges were considering the validity of the provisions referred to above, No doubt it is seen that Wanchoo J., delivering judgment on behalf of the Court, has stated that the vice in the provision is that it makes the opinion of the Corporation, howsoever capricious or arbitrary it may be, or howsoever unreasonable on the face of it may be, conclusive and non-justiciable. And the view of the Supreme Court appears to be that the conferment of such power on a municipal body which has the eiFect of imposing restrictions on carrying on trade, etc., cannot he said to be a reasonable restriction within the meaning of Article 19(6).

47. In our view, the question as to whether there is an exclusion of jurisdiction of the Courts in this case, is purely academic ; because so far as we could see there is no provision in the statute itself which takes away the jurisdiction of the Courts. Therefore, the approach that will have to be made to the attack based upon Article 19(1) (f) and (g) of the Constitution will be on the linos indicated by the Supreme Court in A I R 1959 S C 626, A I R 1962 S C 1371 and AIR 1983 S C 222, having due regard to the provisions contained in the statute itself.

48. A perusal in this case of Section 4(1) of the Act, itself, as was pointed out by the Supreme Court regarding Clause 5 of the Sugar Control Order in A I R 1959 S C 626, shows that it provides the conditions; under which alone the State Government can take; action by way of revoking the license, under Section 4(1) the State Government must form an opinion that the, public interest requires the revocation of the license. It has also to form an opinion under Section 4(1)(a) that the licensee has made wilful and unreasonably prolonged default in doing anything required of him by or under the Act. There is a further check provided in Section 4(1) of the Act imposing an obligation on the part of the State Government to consult the State Electricity Board before revoking a license. There is also another mandatory provision in Sub-section (3) of Section 4 casting a duty on the State Government to issue a notice to the licensee, in the manner provided thereunder, and an opportunity given to the licensee to show cause. In view of tlre.se restrictions and limitations imposed by Section 4(1)(a), we cannot hold that an arbitrary and uncontrolled power has been vested in the State Government in the inattei' of revoking licenses. The conditions under which alone action can be taken, are clearly specified in the section; and the licensee is to be served a notice to show cause in terms of Section 4(3). The power given under Section 4 is to the State Government, which can ordinarily be relied on to discharge its duties honestly, impartially and in the interest of the public. Therefore the contention of the learned counsel for the petitioner that Sections 4 and 5 of the Act are violative of Article 19(1) (f) and (g) of the Constitution, cannot also be accepted. We are of the view that the restrictions imposed are reasonable restrictions in the interest of the general public and are amply protected by Clauses (5) and (6) of Article 19 of the Constitution.

49. Even otherwise, in our view, there is a decision of the Supreme Court which more or less will conclude the contention of the learned counsel for the petitioner in this regard. That decision is the one reported in Mineral Development Ltd. v. State of Bihar, AIR 1960 S C 468. In that decision the power of the State Government to cancel a license under the various clauses referred to in Section 25 of the Bihar Mica Act (Act 10 of 1948) was challenged on several grounds, one of which being that they have placed unreasonable restriction on the petitioner's right to carry on trade and that they infringe the provisions of Article 19(1) (f) and (g) of the Constitution. No doubt this decision is also relied upon by Mr. Surianarayana Iyer for a different purpose; and we will have to refer to it at the appropriate stage. But so far as the present aspect is concerned, it will be seen that the Supreme Court, after considering the provisions of the statute in question, take the view that the power that has been conferred, to cancel a mining license under Section 25(1) of the Act, is on the State Government, and such a power has been entrusted to the highest executive in the State which can ordinarily be relied on to discharge its duties honestly, impartially and in the interest of the public, without any extraneous considerations.

Just as the circumstances under which a revocation of license can be made as provided in Section 4(1) of the Act, with which we are now concerned in this case, on the existence of which alone the State Government can take action, Section 25 of the Bihar Act, which was the subject of consideration before the Supreme Court referred to above, also provided for cancelling of a license or a proprietor's certificate by the State Government under any one or other of the several Clauses (a) to (d) of that section. Referring to this aspect, Subba Rao J., speaking for the Court observes that the section provides clearly ascertainable standards for the State Government to apply to the facts of each case before taking action under the Act. In particular, His Lordship refers to Clauses (a), (b), (e) and (d) of Section 25 (1). According to the Supreme Court, those clauses describe with sufficient particularity the nature of the defaults to be committed and the abuses of which the licensee is to be guilty of in order to attract the penal provisions by way of cancellation. The Supreme Court further states that the discretion of the State Government under Clause (c) of Section 25 (1) of the Act, on the basis of which action was taken in that case, is hedged in by two important restrictions referred to in the judgment, and that power has been entrusted to the State Government in the interest of the general public. Therefore, ultimately the Supreme Court, after adverting to the contention that the only vice is said to lie in the power to cancel a licence conferred on the State Government under Section 25 of the Act, takes the view that the power given to the State Government is only to achieve the object of the Act, i.e., to enforce the said provisions, which have been enacted in the interest of the public, and that power is exercisable on the basis of the provisions contained in Section 25 and in accordance with the principles of natural justice.

50. With great respect, in our opinion, the principles laid down by the Supreme Court in the above decision apply with full force to the matter on hand. Therefore, considering the provisions of Sections 4 and 5 of the Act from that point of view, and in view of the fact that the said power is to be exercised in the interest of the general public, and in view of the conditions laid down in the Act, in our view, the attack levelled by the learned counsel for the petitioner, based upon Articles 14 and 19(1) (f) and (g), cannot be accepted. On the other hand, the contention of the learned Advocate General that Sections 4 and 5 of the Act are valid and that even if there is any restriction, it amounts to a reasonable restriction and is protected by Article 19(5) and (6), and that there is no violation by way of discrimination under Article 14 of the Constitution, will have to be accepted.

51. The third contention that has been urged by Mr, Surianarayana Iyer, learned counsel for the petitioner, is as already referred to, that very many irrelevant matters referred to in Ext P1 must have been taken into account by the State Government tor coming to the conclusion that the license in this case will have to be revoked. That is, according to the learned counsel, very many of the matters referred to in Ext. P1 do not exist, or the petitioner has given satisfactory explanation before the authorities that the defects pointed out to him have been complied with and therefore no action can be taken on the basis of the defects mentioned in Ext. P1. The learned counsel also pointed out that in respect of the manner in which accounts are stated to have been kept by the petitioner, at no stage have the authorities concerned brought this defect to the notice of the petitioner; while, no doubt, the learned Advocate-General takes up the position that all these defects about accounts have been pointed out in the audit reports by the auditors concerned. The learned counsel for the petitioner pointed out that the charge relating to payment of bonus without Government sanction is absolutely illegal because the petitioner has satisfactorily explained, by reference to the provisions contained in the Schedule to the Supply Act, regarding his obligations in the payment of bonus as well as keeping of accounts.

Even in respect of low voltage and other matters referred to in Ext. P1, the petitioner has rectified those defects and informed the authority concerned. Therefore, according to the learned counsel, if the petitioner had been given an opportunity, as requested y him in his explanation Ext. P. 19, all these aspects would have been brought to the notice of the State Government; in which case no action would have been at all taken under Section 4(1)(a).

52. The stand taken, on the other hand, by the learned Advocate General is that no irrelevant considerations at all have been taken into accoifnt by the State Government. No doubt, the parties are at issue on a major point, namely as to whether the opinion that is to be formed by the State Government is a subjective one, in which ease the grounds for forming that opinion can be canvassed by the petitioner before this Court; or whether it is an objective one, as contended by the learned Advocate General, in which case this Court cannot go into the grounds for the formation of the opinion by the State Government. But we ate now only considering a very short question as to whether in forming the opinion, as the State Government is hound to uo under Section 4(1)(a) of the Act, any irrelevant considerations have been taken into account by the State Government. At this stage we may state that in the view that we take regarding the second contention, any discussion on this aspect will be unnecessary, because the grounds for forming the opinion cannot be canvassed before us. But anyhow, we will express our views on this point also.

53. No doubtt in this connection, Mr. Surianarayana Iyer referred us to the decision of the learned Chief Justice and Madhavan Nair, J., reported in Unneri v. Haji M. K. Mohammad, 1963 Ker L J 329 wherein the learned Judges had to consider the grant of a permit under the Motor Vehicles Act, The fearned Judges have no doubt taken the view that if, among the several reasons given by the authority concerned for making the grant, it is found that some of the reasons are non-existent or some of them are extraneous, it is difficult for the Court to come to a conclusion whether the other valid reasons given by the authority would have induced the authority to make the grant. Under these circumstances, the learned judges are of the view that the grant will have to be held to be illegal.

54. But according to the learned Advocate General, the principles laid down by the learned Judges in that case have no application at all to the case on hand, because the provisions of Section 4(1)(a) of the Act will clearly show that a wilful and unreasonably prolonged default in respect of doing anything that is required of the petitioner by or under the Act can be a ground for the State Government taking action by way of revocation of the license. It is not necessary, the learned Advocate General pointed out, that all the charges that are mentioned in Ext. P 1 must be established, so as to give jurisdiction to the State Government to take action by way of revocation. According to the learned Advocate General, every one of the charges mentioned in Ext. P 1 must be considered to he established by the materials placed before this Court by the State Government. Even apart from that, the 'learned Advocate General pointed out that even assuming that some of the charges mentioned in Ext. P 1 are, as contended by the petitioner, not established, nevertheless, this Court should not interfere with the order, because the other charges enumerated in Ext. P 1 are charges on the basis of which, if the State Government forms an opinion, it can certainly take action for revocation of the license.

In this connection, the learned Advocate General referred us to the decision of the Supreme Court reported in Karanpura Development Co. Ltd. v. Kamakshya Narain Singh, (S) AIR 1956 S C 446. We will have also to refer to this decision a little later in connection with the major point that is in controversy between the parties. But at this stage it is only necessity to refer to the contention that was taken before the learned Judges of the Supreme Court in that parlicular case, namely that the Court of Wards has not acted properly in accordance with Section 18 of the Bengal Court of Wards Act. In dealing with that contention, Venkatarama Aivar, J., speaking on behalf of the Court, states at p, 452 of the report that when once it is seen that the Court of Wards has applied its mind and given thought to the question as to whether a particular act is for the benefit of the property or the advantage of the ward, and comes to an honest judgment in the matter, its decision is not liable to be questioned on the ground that it was either erroneous on the merits or that it was reached without considering some aspects, which ought to have been considered, unless the failure to consider them is of such a character as to amount to there being no exercise of judgment at all.

55. We will also make a reference to two other decisions of the Supreme Court, reported in N. Kalindi v. Tata Locomotive and Engineering Co. Ltd., AIR 1980 S C 914 and State of Orissa v. Bidyahhu-shan, AIR 1983 S C 779. In the earlier of these decisions, Das Gupta, J., speaking on behalf of the Court, had to consider as to how Tar a punishment for misconduct can he sustained in that case. The position was that the charges related to certain items, and the finding also was only in respect of certain items, but the order imposing the punishment included an additional item of charge not mentioned in the original charge-sheet at all. The contention that was taken before the Supreme Court was that the whole proceedings are vitiated by illegality, inasmuch as, it the additional charge, which was not a subject of inquiry, was not there before the Officer, the punishment would not have been imposed. This contention was rejected by the Supreme Court, and the learned Judges held that the punishing authority would have passed the order of dismissal even on the findings recorded in respect of the charges for which the party in that case was tried, and therefore the punishment imposed was sustained.

55A. In the latter case referred to above, it is seen that whereas several charges were framed and on some charges at any rate finding had been recorded in favour of the party concerned, nevertheless the punishment was imposed on the assumption that he has been found guilty of all the other charges. That order was again challenged on the ground that the punishing authority acted illegally in proceeding on the basis that the officer has been found guilty of all the charges, whereas he has been acquitted in respect of some of the charges at any rate. Therefore, under those circumstances it was urged that if the punishing authority had realised that the officer had been acquitted on some charges, the conclusion arrived at regarding the finding of misconduct would have been different. That contention was rejected by Shah, J., speaking for the Court. The learned Judge has stated that if the order can be supported on any finding as to substantial misconduct, for which the punishment can be lawfully imposed, it is not for the Court to consider whether that ground alone would have weighed with the authority for imposing the punishment. The punishment imposed in that case was sustained by the Supremo Court. It may be stated that both the decisions of the Supreme Court referred to above related to instances where the Tribunal had to act in a quasi judicial capacily ; and notwithstanding that circumstance and the infirmities noted above, the Supreme Court gave its stamp of approval to the action that had been taken.

56. In the paesent case, it will be seen that under Section 4(1)(a) action can be taken by the State Government, when it forms an opinion that the licensee has made wilful and unreasonably prolonged default in doing anything required of him by or under the Act. It is not as if that before the State Government can exercise its jurisdiction -- assuming it exercises the jurisdiction honestly, in public interest, and for the purpose for which the provisions are made in the Act--there should have been default in respect of several matters. It is competent for the State Government to revoke the license, if it forms an opinion that in respect of any one of the things that is required to the done by or under the Act, the licensee has committed default. Therefore, under these circumstances, in our view, the question of any irrelevant matters being taken into account, does not at all arise for consideration in this case. And, as we have already pointed out in the earlier part of this judgment, the learned Advocate General has pointed out that every one of the allegations which formed the subject of the various charges in Ext. P 1, are amply borne out not only by the averments contained in the counter affidavit filed on behalf of the 1st respondent State, but a!so by the documents produced in this Court on behalf of the State Government and which were before the Government when it took action. Therefore, this contention of Mr. Surianarayana Iyer has also to be rejected.

57. Then the further attack, which is the subject of contention No. 4, by the learned counsel for the petitioner as against the orders passed, is that the orders have been passed mala fide and that there has been a fraudulent exercise of the powers conferred on the State Government under Sections 4 and 5 of the Act. In this connection considerable reliance was placed by the learned counsel on the various proceedings connected with the two suits, one instituted by the petitioner as against the National Tyre & Rubber Co. of India, Ltd., and the other by the latter as against the petitioner as well as the stand that the Chief Engineer, Electricity, took on a former occasion, particularly in Ext. P. 11. We have already referred to the group of documents taken in by Exts. P. 5 to P. 14, as well as to the two suits. We have also adverted to the fact that the Chief Engineer gave a direction to the petitioner not to disconnect the current supply to the Rubber company, as well as the stand taken by that officer that there has been a reference for adjudication made by the Rubber Company under Section 24 of the Act. It is unnecessary for us to cover the ground over again. Finally, the Chief Engineer, Electricity, by Ext. P. 11, called upon the petitioner to file his statement regarding the claim made by the Rubber Company on the ground that there was a reference under Section 24 of the Act. No doubt, that order was the subject of attack in this Court in O. P. No. 475 of 1981. That order was quashed, as we have already pointed out, by our learned brother Raman Nayar, J., by his judgment, Ext. P. 14 dated 19th December 1961.

58. One of the contentions that is taken by the learned counsel for the petitioner is that when on a former occasion the Department pointed out the various defects in the running of the petitioner's undertaking, which originated on 28-4-1959 by the Superintending Engineer issuing Ext. P. 20, a conference took place between the petitioner, and the Department. According to the petitioner, the entire defects have been rectified, as will be seen from his communication Ext. P. 25 dated 13-8-1960. According to the learned counsel, the petitioner, in Ext. P. 25, has categorically stated that the low voltage which was the gravamen of the charge in the various correspondences that emanated from the Department, had been rectified, and after that there was no complaint whatsoever made by the Department in that regard. It is only alter the Chief Engineer takes sides and supports the stand of the National Tyre & Rubber Company, by issuing Ext. P. 11, and his action is successfully challenged by the petitioner and a decision rendered as against the officer by this Court in Ext. P. 14 on 19-12-1901, that further proceedings emanated from the Electrical Inspector under Ext P. 15 on 14-3-1982. That is, according to the learned counsel, when everything has been done and directions given by the Department have been complied with, and when there has been no complaint whatsoever for nearly two years, the Department again takes up the question of the petitioner's undertaking suffering from certain defects, when they were worsted in this Court in O. P. 475/61. It is really on the basis of the report that had been sent by such an officer, viz., the Chief Engineer, Electricity, Ext. R. 1, that the State Government has ultimately initiated proceedings evidenced by Ext. P. 1. That is one ground relied on by the learned counsel for the petitioner in support of his plea that the whole proceedings initiated under the Act by the State Government are prompted by mala fides.

The learned counsel also attempted to find some support from the plea that the Managing Director of the National Tyre and Rubber Co. Ltd., with whom the petitioner has been fighting a litigation and whose cause is stated to be supported by the Chief Engineer, Electricity, was nominated as a member of the Kerala State Electricity Board, the 2nd respondent in these proceedings, on 1st April 1962. Therefore the inference that the learned counsel wants this Court to draw is that the said gentleman, namely the Managing Director of the National Tyre and Rubber Co, must have had a considerable hand in influencing the 2nd respondent when the latter was consulted by the State Government under Section 4(1) of the Act, for revoking the license of the petitioner's undertaking. Therefore the learned counsel urged that though it may be difficult for his client to establish mala fides hy direct evidence, as laid down by the Supreme Court in the decision reported in Partab Singh v. State of Punjab, AIR 1994 SC 72, this Court, having due regard to the surrounding circumstances under which the orders in question have been passed, should legitimately infer that they have been passed mala fide.

59. No doubt these contentions of the learned counsel for the petitioner have been very strenuously controverted by the learned Advocate General on behalf of the State Government, and also by Mr. G. R. Menon, learned counsel for the 2nd respondent Board. The learned Advocate General urged that there is absolutely no allegation in the affidavit filed by the petitioner attributing any mala fides to the State Government as such under Section 4(1) of the Act, the learned Advocate General pointed out, the opinion that is to be formed in respect of the several matters, on the basis of which action has been taken in this case, is the opinion not of the Chief Engineer or of the 2nd respondent Boai'd, but the opinion of the State Government. According to the learned Advocate General, so far as the formation of that opinion is concerned, whether it is subjective or objective, there is no allegation made by the petitioner to the effect that the said opinion has been formed mala fide and that the exercise of the power under Section 4(1) by the State Government is a fraudulent exercise of such power.

The learned Advocate General also pointed out that the allegation made as against the Chief Engineer cannot certainly be sustained because, even according to the facts relied upon by the petitioner himself, it will be seen that the Chief Engineer sent a communication to the petitioner not to disconnect the supply of current to the Rubber Company, only on 21-10-1980 under Ext. P-6. But in this case the proceedings will clearly show that the petitioner has been informed on 28-4-1959, evidencecf by Ext. P-20, about the various defects that had been found on an examination of the undertaking by the Superintending Engineer as early as 22-1-1959. And the further proceedings which have been already referred to by us in the earlier part of this judgment, the learned Advocate General pointed out, will clearly show that the petitioner was accepting the existence of very many of the defects pointed out by the Department;

All those proceedings were long before the action taken by the Chief Engineer under Ext. P-6.

The learned Advocate General urged that even according to the petitioner, the Managing Director of the Rubber Company was nominated to the 2nd respondent Board only on 1-4-1902, whereby Ext. P-15 dated 14-3-1962, after an inspection of the undertaking of the petitioner even on 20-1-1962 the Electrical Inspector has intimated the petitioner about the existence of various defects that still existed in the undertaking. And the learned Advocate General pointed out that in the reply Ext. P-16 sent by the petitioner, the latter has again substantially accepted the existence of those defects. Under those circumstances, the learned Advocate General asks whether the State Government can be considered to have exercised their powers mala Sde and not for the purpose for which the power has been conferred on the State Government under Section 4(1) of the Act.

60. So far as the 2nd respondent, the State Electricity Board, is concerned, Mr. G. R. Menon learned counsel on their behalf, pointed out that the Electricity Board has not in any manner been influenced or asked to take any particular decision because of the presence of the Managing Director of the Rubber Company on the Board from 1-4-1962. The 2nd respondent has also stated that the decision taken by them has absolutely no reference at all to any attitude that the Rubber Company officers may have adopted towards the petitioner in the litigation that ensued between them in 1958 and 1957. Therefore the learned counsel pointed out that even as asaimt the Electricity Board, the charge of mala fides is absolutely baseleSections

61. Mr. Surianarayana Iyer, learned counsel for the petitioner, no doubt urged that it is essentially on the basis of the report of the Chief Engineer and the recommendation of the Electricity Board, that the State Government has taken a decision to revoke the license of the patitioner's undertaking, and therefore when the foundation for the action taken by the State Government is vitiated by mala fides, the action of the State Government itself will have to be quashed.

62. We have given due consideration to the various aspects presented before us regarding this aspect, by Mr. Surianarayana Iyer, learned counsel for the petitioner, as well as by the learned Advocate General on behalf of the State and Mr. G. R. Menon, learned counsel on behalf of the 2nd respondent Board. We are not impressed with the contention of the learned counsel for the petitioner that in the circumstances of this case it is possible for us to accept his contention that the proceedings evidenced by Exts. P-1, P-2 and P-3 have been prompted by any mala fides on the part of the State Government. As pointed out by the learned Advocate General, there is absolutely no allegation in the affidavit of the petitioner attributing any mala Sdes to the State Government either when they claimed to have formed an opinion as required by Section 4(1) of the Act or when they issued the notice Ext. P-1 as well as when they passed the orders of revocation and the direction to sell the undertaking under Exts. P. 2 and P-3.

63. We have earlier very exhaustively dealt with Exts. P-20 to P-26 which took place between 28-4-1959 and 13-8-1960, as well as to the further correspondence that ensued bet ween'the Electrical Inspector and the petitioner in 1962, namely Exts. P-15 and P-16. The mere circumstance that the Chief Engineer, Electricity, took a view on a particular occasion, especially in Ext. P-11, to the effect that there has been a reference made to him under Section 24 of the Act by the Rubber Company, does not in any manner warrant or justify this Court in coming to the conclusion that all the previous proceedings that emanated from him or the subsequent proceedings as well as the report that he ultimately sent under Ext. R-1 on 28-5-1962, are in any manner actuated by mala fides. Even assuming that there is mala fides on the part of any of the officers, or the Electricity Board, in our opinion, before the orders passed by the State Government can be set aside on the ground of mala fides the petitioner will have to establish that the State Government itself, when forming its opinion and issuing the orders in question have acted mala fide. And so far as that is concerned, in our view, the petitioner cannot be considered to have succeeded in that attempt.

64. No doubt we are aware of the observations at page 83 of Rajagopala Aiyangar, J., in the decision of the Supreme Court reported in AIR 1964 S C 72, to the effect that the party who seeks to invalidate: or nullify any act or order must establish the charge of bad faith, an abuse or a misuse by Government of its powers. The learned Judge no doubt takes note of the fact that the indirect motive or purpose, or bad faith or personal ill-will is not to be held established except on clear proof thereof. But the learned Judge also recognises the obvious difficulty to establish the state of mind of a particular person. But the learned Judge is of the view that the contention that the mala fides should be established only by direct evidence, that is, that it must be discernible from the order impugned or must be shown from the notings in the file which preceded the order, cannot be accepted. But the learned Judge observes that if bad faith would vitiate the order, the same, can be deduced, as a reasonable and inescapable inference from proved facts.

The learned Judge also emphasises in the latter part of the judgment that :

'The Constitution enshrines and guarantees the rule of law and Article 226 is designed to ensure that each and every authority in the State, including the Government acts bona fide and within the limits of its power and we consider that when a Court is satisfied that there is an abuse or misuse of power and its jurisdiction is invoked, it is incumbent on the Court to afford justice to the individual.'

65. We are also aware of the observations made, by Gajendragadkar J., (as he then was) in a later decision reported in Union of India v. H. C. Goel, A I R 1984 S C 364. At p. 369 of the report, the learned Judge states that the charge of mala fides and the charge of the conclusion having been arrived at on no evidence at all, are two infirmities which are separate and distinct. The learned Judge states that a mala fide exercise of power can be attacked independently on the ground that it is mala fide, and it can be quashed on the main ground, then it is not a bona fide exercise of power. But the learned Judge emphasises that there may be cases of conclusions arrived at on no evidence even though the Government has been acting bona fide. If that infirmity is found to exist, the Court can set aside the order notwithstanding the fact that no mala fides is alleged or established, and even if Government has bona fide come to a conclusion.

66. Having due regard to these observations made by the Supreme Court, in the state of the records in this case, we are not satisfied that we can accept the contention of the learned counsel for the petitioner that the orders Exts. P. 1, P. 2 and P. 3 are vitiated by mala fides, nor can we accept the further contention of the learned counsel that it is a fraud on the exercise of power conferred on the State Government, under Section 4(1) of the Act.

67. That brings us to the major contention, which is the second contention, that has been referred to by us earlier, namely as to whether, when the State Government takes action by way of revocation of the license under Section 4(1)(a) of the Act, it exercises quasi judicial functions and whether the grounds for its action can be reviewed by this Court. We have also indicated that according to Mr. Surianarayana Iyer, learned counsel for the petitioner, the Government when it is exercising its jurisdiction under Section 4(1) of the Act, exercises quasi judicial functions and that it must give reasons for the conclusions arrived at by it in the order itself after giving an opportunity to the party, against whom action is sought to be taken. The further contention of the learned counsel for the petitioner is thiit the opinion formed by the State Government under Section 4(1) of the Act, on the basis of which action was taken, is an objective one, which could be reviewed by this Court under Article 226 of the Constitution. The learned counsel has also taken up a further contention that in this case, ou the materials placed by the petitioner, as well as by the State Government, no reasonable tribunal or authority could come to the conclusion as has been done by the State Government that the petitioner has committed wilful and unreasonably prolonged default, when it passed the orders Exts. P. 2 and P. 3. There was also a subsidiary contention under this head taken by the learned counsel for the petitioner, namely that in the order Ext P. 2, revoking the license, there is absolutely no finding recorded by the State Government that the petitioner has made wilful and unreasonably prolonged default in doing anything that is required of him by or under the Act. That again, according to the learned counsel, vitiates the orders.

68. According to the learned Advocate General, the formation of an opinion under Section 4(1) of the Act is essentially subjective and the correctness of the opinion formed by the State Government cannot be canvassed before this Court under Article 226. That is, according to the learned Advocate General, the opinion formed by the State Government cannot be subjected to objective tests by this Court. The only aspect that this Court will have to consider, in considering the attack levelled by the petitioners as against the orders in question, is to see whether as a matter of fact the State Government has formed the opinion in respect of the matters referred to in Section 4(1)(a) of the Act and as to whether there were materials before the Government when forming the opinion and whether it has acted honestly. If this Court comes to the conclusion that the State Government has honestly formed that opinion and there are materials before the State Government on the 'basis of which it was possible for them to form an opinion that the petitioner has committed wilful and unreasonably prolonged default in doing anything required of him by or under the Act, and that revocation is in public interest, the correctness of the opinion formad by the State Government cannot be canvassed by the petitioner in this Court and the petitioner cannot be granted any relief even on the ground that the opinion formed by the Government is erroneous.

The learned Advocate General no doubt pointed out that if the grievance of the petitioner is that the action has been taken by the State Government on the ground that he has committed wilful and unreasonably prolonged default in doing anything required of him by or under the Act, whereas under the Act he is not bound to do any of these things, that will be a totally different matter. Such a contention has not been taken by the learned counsel for the petitioner in these proceedings; because if that is established, it will ba a case of no materials being available before the Government for forming the opinion, under Section 4(1) of the Act. In such a case, the Advocate General pointed out it may be open to this Court to set aside the order not on the ground that the formation of the opinion is not correct, but for forming an opinion, there are no materials at all on record, The learned Advocate General also pointed out that in this case there is nothing to show, by the wording of the particular provisions of the statute, to which we will make reference immediately, that the opinion that is to be formed by the State Government under Section 4(1)(a), notwithstanding the fact that there is provision made for the issue of a notice under Sub-section (3) of Section 4, constitutes the Government as a quasi judicial authority or makes the decision a quasi judicial one.

69. Before we express our views on this aspect, it is better to refer to the provisions contained in Section 4(1) of the Act. In the earlier part of the judgment we have already extracted Section 4(1) of the Act. It will be seen that the opening words of Section 4(1) are 'The State Government may, if in its opinion the public interest so requires ....................... Then again, it will be seen that in respect of the various grounds under which the State Government can revoke the license, Clauses (a), (c)(i), (d) and (e) of Section 4(1) are differently worded from the grounds mentioned in Clauses (b) and (c) (ii). Whereas Clauses (a), (d) and (e) use the expression 'in the opinion of the State Government', Clause (c) (i) of Section 4(1) uses the expression 'to the satisfaction of the State Government'. The position is entirely different when we come to Clause (b) of Section 4(1) as well as Clause (c) (ii) of Section 4(1). No doubt the requirement regarding the notice under Sub-section (3) is in respect of action that may be taken by the State Government under any one of the Clauses (a) to (e) of Section 4(1). In this connection it may be stated that Sub-section (3) of Section 4 was introduced by Amendment Act 32 of 1959. But it must also be stated that Clauses (d) and (e) of Section 4(1), which provide two additional grounds for taking action by way of revocation of the license, were also introduced by the same Act 32 of 1959. It is the opinion of the State Government that is made necessary for the purpose of such cancellation in respect of matters provided for under those two sub-clauses. We are particularly referring to this aspect because Mr. Surianarayana Iyer learned counsel for the petitioner pointed out that inasmuch as the notice to be issued under Sub-section (3) of Section 4 takes in action sought to be taken on the basis of Clauses (a) to (d) of Sub-section (1) of Section 4, all the clauses must bear the same interpretation, though different phraseology has been used.

70. In this connection, it may be stated that there is a direct decision of a Full Bench of the Bombay High Court reported in Hubli Electricity Co. Ltd. v. Province of Bombay, A I R 1947 Bom 276 (FB). The attack that was made before the. Bombay High Court in that case was regarding the cancellation of a license under Section 4(1) (a) of the Act. No doubt it must be pointed out at this stage, that when the proceedings were disposed of either by the Bombay High. Court, or later by the Privy Council, in Hubli Electricity Co. v. Province of Bombay, AIR 1949 P C 136 the provisions regarding the issue of a notice now contained in Sub-section (3) of Section 4, were not in the statute. But one of the questions that will arise and that has been raised by the learned counsel for the petitioner is that the introduction of Sub-section (3) of Section 4, making it mandatory on the part of the State Government to issue a show cause notice, as well as the coming into forceof the Constitution guaranteeing certain fundamental rights, makes a lot of difference, and that the principles laid down by the Privy Council will have to be reconsidered by this Court. To that aspect we well advert later.

71. As pointed out, a licensee whose license was cancelled under Section 4(1)(a) of the Act, challenged the same before the Bombay High Court, and that grievance was considered by a Full Bench consisting of Stone, C. ]., and Chagla, J. (as he then was) and Coyagee, J. No doubt a reading of the judgment of the Full Bench will clearly indicate the divergent manner in which judicial minds work. The learned Chief Justice was prepared to take the view that though the State Government, when cancelling the licence, acts in an executive capacity and administratively, nevertheless the functions it is called upon to discharge under Section 4(1)(a) of the Act are of a quasi judicial nature. Chagla, J., was not prepared to express any opinion as to whether, when exercising jurisdiction under Section 4(1)(a) of the Act the State Government is discharging quasi judicial or judicial functions. But the learned Judge took the view that the Government was not bound to establish in a Court of law the facts or circumstances, on the basis of which, it formed the opinion required of it under Section 4(1)(a) of the statuta Coyajee, J., on the other hand, took the view that the Government acts purely in an administrative and executive capacity under Section 4(1)(a) and it is not bound to place before the Court the reasons for forming that opinion. Ultimately in view of the majority judgment, the licensee's claim was rejected by the Bombay High Court.

72. The matter was taken in appeal to the Privy Council, whose decision is reported in AIR 1949 P C 136. Two contentions were raised before the Privy Council. The first was that the opinion of the Government referred to in Section 4(1)(a) was not the subjective opinion of the Government, but an opinion subject to objective tests. The second contention was that in exercising its functions under Section 4(1)(a) of the Act, the Government was bound to act in a judicial manner without contravening the rules of natural justice. The second contention, that the Government was bound to act in a judicial manner, was ho doubt adverted to by the Privy Council. But inasmuch as there appears to have been no ground of attack raised by the party that there is any violation of rules of natural justice the Privy Council has stated that they do not express any opinion as to whether the Government, when exercising jurisdiction under Section 4(1)(a) of the Act and forming an opinion, acts judicially or purely in a ministerial and adminisirative capacity. Therefore that question was not directly adjudicated upon by the Privy Council.

73. But the Privy Council considered the other question that arose for consideration, and which arises now before us, namely as to whether the opinion formed by the State Government under Section 4(1)(a) is the subjective opinion of the Government or an opinion subject to objective tests. As we have already pointed out, according to Mr. Surianarayana Iyer, learned counsel for the petitioner, it is a subjective opinion of the Government and as such the grounds for such opinion can be canvassed before this Court, whereas according to the Seamed Advocate-General, that opinion cannot be subjected to objective tests. On this aspect, having due regard to the provisions contained in Section 4(1)(a) of the Act, their Lordships are unable to see that there is anything in the language of Section 4(1)(a) or in the subject-matter to which it relates, upon which to found the suggestion that the opinion of the Government is to be subject to objective tests. And the Privy Council also observes that in terms the relevant matter is the opinion of the Government, not the grounds on which the opinion is based. The Privy Council very categorically lays down at p. 139 that

'the language leaves no room for the relevance of a judicial examination as to the sufficiency of the grounds on which the Government acted in forming an opinion.'

74. So far as the decision of the Privy Council goes, that certainly is against the contentions of Mr, Surianarayana Iyer, learned counsel for the petitioner, that the opinion that is to be formed by the Government under Section 4(1)(a) of the Act is subjective, and not objective. But the learned counsel pointed out that since the decision of the Privy Council rendered in 1949, two circumstances have intervened, namely (1) the coming into force of the Constitution, guaranteeing fundamental rights to persons like the petitioner, and (2) provision made by the Legislature itself in Sub-section (3) of Section 4 making it mandatory on the part of the State Government to issue the notice in the manner required therein and giving opportunity to persons, against whom action is sought to be taken, to show cause against the proposed action. These circumstances, according to learned counsel, nullify the decision of the Privy Council. The question then is whether these circumstances in any manner alter the decision, that has to be arrived at in this case.

75. The question as to whether the introduction of Sub-section (3) in Section 4 of the Act, makes any difference at all, has directly come up for consideration before a Division Bench of the Madhya Pradesh High Court in the decision reported in Barnagar Electric Supply and Industrial Co. v. State of Madhya Pradesh, A I R 1963 Madh Pra 41, consisting of Dixit. C, J. and Pandey, J. We will have to advert to this decision a little later after referring to certain decisions of the House of Lords as well as of the Supreme Court where expressions, substantially similar to Section 4(1)(a), have come up for consideration. In this context it is significant to note that in Section 4(1), as we have already pointed out, the opening words are 'The State Government may, if in its opinion the public interest so requires .... ,'. Then again, coming to Clause (a) of

Section 4(1) it is again stated that '....... in the opinion or the State Government, makes wilful and unreasonably prolonged default. . . . .'. To the same effect are the provisions in Clauses (d) and (e) of Section 4(1) which have admittedly been introduced in the Act, long after the coming into force of the Constitution, along, no doubt, with the introduction of Sub-section (3) of Section 4 of the Act.

76. Mr. Surianarayana Iyer, learned counsel for the petitioner, pointed out that there is a mandatory provision in Sub-section (3) of Section 4 making it obligatory on the part of the State Government to issue a notice prescribing a minimum period, and also to state in the notice the grounds on which il proposes to revoke the license of the party. The party is also given an opportunity to show cause as against the notice. An obligation is also imposed on the State Government to consider any cause that may be shown by the licensee. Hence the entire proceedings contemplated in Sub-section (1) of Section 4 of the Act assume a quasi judicial nature and such is the jurisdiction that is exercised by the State Government.

The counsel urged that if it is held that the State Government can form an opinion in any manner it likes, notwithstanding any objections that may be raised by the party in response to the notice issued under Sub-section (3) of Section 4, and if that opinion cannot be canvassed before this Court, then it means that the issue of the notice under Sub-section (3) of Section 4 is absolutely illusory and serves no purpose whatsoever. That provision according to the learned counsel has been introduced by the legislature in order that a party, against whom action is sought to be taken, may place his objections, and casting at the same time an obligation on the part of the State Government to consider those objections in the sense that it is to adjudicate judicially upon the matters raised by him and express its opinion in the order that may be passed, so that the grounds on which the opinion was formed by the State Government as well as the opinion itself may be reviewed by this Court in proceedings under Article 228.

77. In our opinion, and as we will immediately show by reference to certain decisions of the House of Lords as well as of the Supreme Court, this contention of the learned counsel for the petitioner cannot be accepted. After all, one cannot ignore the different expressions used by the Legislature in the various clauses in Section 4(1) of the Act. We have already ndicated that the expression 'in its opinion' occurs in Clauses (a), (d) and (e) of Section 4(1). Again, in respect of one of the grounds (or revocation provided for in Sub-clause (i) of Clause (c) of Section 4(1), there is a requirement that the party must satisfy the Government that he is in a position to fully and efficiently discharge the duties and obligations imposed on him by his license; whereas in certain other contingencies where action can be taken, particularly under clause b) and Sub-clause (ii) of Clause (c) the wording is entirely different. And the mere fact that in respect of all these grounds or any of the grounds, which may form the basis for taking action by way of revocation under Section 4(1), notice is directed to be issued under Sub-section (3), in our opinion, cannot lead to the conclusion that the different expressions used in Clauses (a) to (d) of Section 4(1) will have to be interpreted in the same manner. That will be ignoring the plain words used by Legislature in the different sub-clauses of Section 4(1) of the Act. No doubt Mr. Surianarayana Jyer has drawn our attention to the meaning of the expression 'consider' as found in Black's Dictionary. According to the learned counsel it will clearly show that the expression 'consider' must receive a connotation that there must be an adjudication by the authority concerned in a judicial manner. We are not inclined to accept this large contention of the learned counsel. Issue of notice under Section 4(3) as well as the consideration that is to be given by the Government in respect of any cause shown in response to the notice under Section 4(3), must be a consideration having due regard to one or other of the several grounds stated in the notice for revoking the license under Section 4(1) of the Act.

78. If the contention of the learned counsel for the petitioner is to be accepted in toto, it will mean that in response to the notice issued under Sub-section (3) of Section 4, it will be open to a party against whom action is sought to be taken to even attempt to satisfy the Government that the formation of the opinion by the State Government that 'the public interest requires' revocation of the license, is not correct. In our opinion, the party has no such right, because, when the State Government forms an opinion that public interest requires revocation of the license, there is no judicial process involved. Mr. Surianarayana Iyer has no doubt placed considerable reliance on the decision of the Supreme Court reported in AIR 1960 S C 468. We have already adverted to this decision when considering the attack levelled by the learned counsel as against Sections 4 and 5 of the Act as being violative of the fundamental rights guaranteed under Articles 14 and 19(1)(f) and (g) of the Constitution, But we have now to refer to the same decision for a different purpose.

79. The Supreme Court in that decision had to consider the question as to whether the action taken by the State Government by way of revoking or cancelling a license granted under the Bihar Mica Act (Act 10 of 1948) was a valid exercise of power by the Slate Government. The provisions of Section 25 of the said Act have been extracted by Subba Rao, J., speaking for the Court, at p. 471 of the report. There are four clauses in Sub-section (1) of Section 25, on the basis of any of which, the State Government was given power to cancel a license or proprietor's certicate. In particular, Clause (c) of Section 25 (1) enabled the State Government to cancel a license, if the licensee 'is guilty of repeated failure to comply with any of the provisions of this Act or rules made thereunder.' There is a second proviso to Section 25 (1) to the effect that a license or a proprietor's certificate should not be cancelled unless the licensee or the proprietor has been furnished with the grounds for such cancellation and has been afforded reasonable opportunity to show cause why his license shall not be cancelled.

80. The cancellation of the license in that case was attacked on two grounds, namely, that a very arbitrary power has been given to the State Government under Section 25 (1) without any guidance being furnished by the Legislature and theretoreit infringes the fundamental rights under Article 19(1) (f) and (g) of the Constitution. That contention was negatived by the Supreme Court, and we have already adverted to that aspect in the earlier part of this judgment. The second contention that was dealt with by the learned Judges in that case was as to whether the State Government, when cancelling the license in that case, have complied with the provisions of Clause (c) of Sub-section (1) of Section 25 of the Act in question, read with the second proviso. The contention that appears to have been taken before the learned Judges is that there has been no finding recorded by the State Government either in the snow cause notice issued by them or in the ultimate order of cancellation of the license, to the effect that there is repeated failure to comply with the piovisions of the Act which is a necessary condition for cancellation of the license.

Therefore it was urged that the State Government's order cancelling the license, was absolutely illegal as it was not in conformity with the provisions of the statute. In dealing with this contention, the learned Judges, after considering the particular facts of the case, ultimately come to the conclusion that the records do not disclose that the allegation made as against the party in question, that there has been a repeated failure, on the basis of which alone, action can be taken, has been made out in the case. In fact, the learned Judges are of opinion that it is obvious that the license, affecting rights of great magnitude was cancelled, to say the least, for trivial reasons; and the essential condition, the existence of which alone will give jurisdiction to the State Government to take action, namely the repeated failure of the licensee to comply with any of the provisions of the Act under Section 25 (1) (c) of the Bihar Act in question, has not been established. Finally the Supreme Court came to the conclusion that the action taken by the State Government by way of cancellation of the license was absolutely void.

81. On this decision of the Supreme Court Mr. Surianarayana Iyer, learned counsel for the petitioner, placed considerable reliance. He urged that in the present case also, just as the Supreme Court considered the various reasons given by the Stale Government as well as the materials placed before it for satisfying itself as to whether the essential requisite for taking action has been made out, this Court should make a similar approach in considering the grievance of the petitioner. In our opinion this contention of the learned counsel for the petitioner cannot be accepted. The wording of Section 4(1)(a) of the Act, with which we are now concerned, is entirely different from the provisions which the Supreme Court had to consider. It may be that if a question arises, challenging the legality of an action-taken by the State Government under Clause (b) of Section 4(1) or Sub-clause (ii) of Clause (c) of Section 4(1), the principles laid down by the Supreme Court may have full force and application. Because, under those circumstances, an adjudication will have to be made by the State Government as to whether the licensee has broken any of the terms or conditions of the license, and if so, which term and condition, if action is to be taken under Clause (b) of Section 4(1), or whether the licensee has failed to make the deposit or furnish security if action is to be taken under Sub-clause (ii) of Clause (c) of Section 4(1). Their Lordships of the Supreme Court had no occasion to deal with a case where the matter was left for the formation ot an opinion by the State Government, with which wo are now concerned in these proceedings.

82. Mr. Suriayanarayana Iyer next referred us to the decision of the Supreme Court reported in Shivji Nathubhai v. Union of India, A I R 1900 S C 608, wherein the action of the Central Government exercising powers under Rule 54 of the Mineral Concession Rules, 1949, and setting aside the grant of license made by the State Government in favour of the party, was challenged. In that case it will be seen that the appellant before the Supreme Court was granted a license by the State Government under the Mines and Minerals Regulation and Development Act (Act No. 53 of 1948). But power was given to the Central Government under Rule 54 of the Mineral Concession Ruled, 1949, to review the order of the State Government when its jurisdiction is invoked by any party. In that case the party, who did not obtain a licence at the hands of the State Government, moved the Central Government under Rule 54 of the Mineral Concession Rules for cancelling the grant made by the State Government in favour of a third person. That third person was not made a party to the proceedings before the Central Government, which were initiated under Rule 54 of the Mineral Concession Rules. The Central Government, without issuing notice to the person, whose grant was sought to be set aside, set aside that grant and issued a license instead, in favour of the party who invoked its jurisdiction under Rule 54.

On coming to know of this, the original guarantee under the State Government filed an application before the Central Government, to review the order passed under Rule 54 and give him an opportunity of contesting the claim of the party who had invoked its jurisdiction. That was rejected by the Central Government and thiit order of the Central Government was challenged before the Supreme Court by the party aggrieved. The Supreme Court, after referring to the provisions of Rule 54, at p. 608 of the report, and also after noting the contentions of the appellant before it that the Central Government when exercising its jurisdiction under Rule 54 acts as a quasi-judicial authority, as well as the contention of the respondent before it that the Central Government acts purely as an executive or administrative authority, holds that under the circumstances when rights conferred already on third parties are sought to be dislodged and for that purpose the jurisdiction of the Central Government is invoked under Rule 54, it must be held that the functions that are exercised by the Central Government are in the nature of quasi-judicial authority.

According to the Supreme Court, there is a lis between the person who invokes the jurisdiction of the Central Government under Rule 54 and the party whose grant is sought to be set aside by the applicant before the Central Government. Therefore the Supreme Court ultimately came to the conclusion that under those circumstances, notwithstanding the fact that Rule 54 does not lay down any particular procedure for adjudicating upon the claims of parties, nevertheless, inasmuch as there is a lis between the person to whom the license has been granted and the person who is aggrieved by the refusal, there is a duty on the part of the authority, namely, the Central Government, to act judicially, and a decision can be arrived at only after giving notice to the party who may be aggrieved by the decision that is being taken by the Central Government.

83. In our opinion, this decision of the Supreme Court also will not assist the learned counsel for the petitioner in the present case, because there can he no controversy that a party, in whose favour a grant has been made, is attempted to he dislodged, by action being taken by the disappointed party, by invoking the jurisdiction of a higher authority ; it stands to reason that the party, whose rights will be affected by proceedings initiated by the aggrieved party, must be heard before a final decision is taken by the Central Government.

84. Mr. Surianarayana Iyer, learned counsel for the petitioner, then referred us to the decision of the Supreme Court reported in Board of High School and Intermediate Education, U.P. Allahabad v Ghanshyam Das Gupta, A I R 1962 S C 1110 wherein the nature of the jurisdiction exercised by the Committee of Examiners in considering the conduct of a student who is alleged to be guilty of malpractice in an examination, was considered by the Supreme Court. The Supreme Court, no doubt comes to the conclusion that though there is no particular procedure laid down, either by the statute or the rules, to be followed by the Examining Committee before funding a student guilty of malpractice, nevertheless, inasmuch as very serious rights of a student, who may be found to be guilty of malpractice are involved as a result of a decision being rendered by the authority, it must be held that there is a duty on the part of the Examining Committee to act judicially and a decision can be taken by them only after giving an opportunity to the party concerned to place his point of viewer objections to the action which is sought to be taken. The Supreme Court no doubt takes the view that though there is no lis in the sense that there are two parties opposing the claim of each other, nevertheless, in the particular circumstances of that case, notwithstanding the fact that there is only the authority who proposes to initiate action and impose the punishment on the one hand, and the student who opposes that claim on the other, it must be considered that the Committee of Examiners will have to act judicially under those circumstances.

85. The learned counsel for the petitioner placed considerable reliance on this ruling of the Supreme Court because in the case on hand before us also, according to the learned counsel, the position is the same, namely, that the State Government wants to take action by way of revoking the license of the petitioner's undertaking acting under Section 4(1)(a) of the Act, and the petitioner opposes the claim made by the State Government in that behalf; and the petitioner's rights will be seriously jeopardised by any adverse action that may be taken as it has now turned out, by the order of revocation of the license passed by the State Government. Therefore, considering these circumstances, the learned counsel pointed out, in this case also there is a duty cast on the State Government to act in a quasi-judicial : manner. No doubt the same principles have been laid down by the Supreme Court in the decision reported in Board of Revenue v Vidyawati, AIR 1982 S C 1217. But here again, we are not inclined to accept the contention of the learned counsel for the petitioner that those decisions will have any application to the facts of the present case. The learned Judges, having due regard to the circumstances of the case, came to the conclusion that particular functions exercised by the Committee of Examiners was quasi-judicial in nature. The Supreme Court had no occasion to consider the expression that we are called upon to interpret in this case, namely,'The State Government may, if jn its opinion thatpublic interest so requires.'

86. Mr. Surianarayana Iyer again referred us to the decision of the Supreme Court reported in Commr. of Income-tax v. Sivakasi Match Exporting Co., Sivakasi, AIR 1964 S C 1813, wherein the Supreme Court has held that the Income-tax Officer, acting under Section 26-A of the Indian Income-tax Act, 1922, has to act judicially. Here again we do not see that the Supreme Court had any occasion to interpret any section of the statute wherein the words 'in its opinion' occur. Therefore this decision also does not assist the learned counsel.

87. We will consider later the question as to how far any infirmity attaches to the order Ext. P2 in view of the fact that it does not, in so many words record a finding to the effect that the State Government is of the opinion that the petitioner has made wilful and unreasonably prolonged default in doing anything required of him by or under the Act, because, for that purpose, the learned Advocate-General referred us to a decision to which we will refer at the appropriate stage.

88. According to the learned Advocate-General, the decision of the Privy Council in A I R 1949 P C 136, which we have referred to earlier, will apply with full force to the case on hand. The principle laid down by the Privy Council that the formation of the opinion by the State Government cannot be subject to any objective tests by this Court, is not in any manner altered by the coming into force of the Constitution, or by the introduction of Sub-section (3) of Section 4 of the Aet. The learned Advocate General referred us, in this connection to the decision of the House of Lords reported in Allcroft v. Lord Bishop of London, Lighten (1891) A C 666. We are particularly referring to this decision because, as we will presently show, some of the observations made by the two Law Lords namely Lord Bramwell, and Lord Herschell, in this case, have been quoted with approval by the Supreme Court in a decision to which we will have to refer later. The House of Lords had to consider the effect of the provisions contained in Section 9 of the Public Worship Regulation Act, 1874, particularly the expressions occurring therein

'unless the Bishop shall be of opinion, after considering the whole circumstances of the case, that proceedings should not be taken on the representation, in which case he shall state in writing the reasons for his opinion',

The grievance was that when representations were made under Section 9 of the statute referred to above, the Bishop declined to take any action. Therefore the Court was moved for the issue of writ of mandamus to compel the Bishop to take appropriate action.

Lord Halsbury, L. C. observes at p. 675 :

'But it is obvious that, to justify any writ of mandamus, it must be made to appear that the Bishop has not exercised the jurisdiction which the statute has vested in him. Your Lordships have nothing to do with the question whether his judgment is right or wrong. Your Lordships would be exceeding your own jurisdiction if you were attempting to review a judgment, the jurisdiction to form which the Legislature has confided to the bishop and to the bishop alone.'

Then again, Lord Bramwell, at 678 in dealing with the same aspect, observes :

'Then it was said that there was something he had considered which he ought not to have considered, and something he had not considered which he ought to have, and so he had not considered the whole circumstances and them only. It seems to me that this is-equivalent to saying that his opinion can be reviewed, I am clearly of opinion it cannot be. If a man is to form an opinion, and his opinion is to govern, he must form it himself on such reasons and grounds as seem good to him.'

In fact, as we will show presently, this particular extract has been quoted with approval by the Supreme Court. The substance of the extract is to the effect that if a man is to form an opinion and his opinion is to govern, he must form it himself on such reasons and grounds as seem good to him. The other Law Lord, namely Lord Herschell, at p. 680 : observes as follows :

'My Lords, when the statute prescribes that the bishop's opinion is to be formed after considering, the whole of the circumstances of the case, I think it must mean that the bishop is to consider all the circumstances which appear to him, honestly exercising his judgment to bear upon the particular case, and upon the question whether he ought in that case-to prevent proceedings being taken, J dissent entirely from the view that it is for the Courts or Your Lordships to determine what are the consideration which, ought to govern the bishop's opinion.'

Again at p. 682, Lord Herschell observes :

'It is impossible to read the bishop's statement without seeing that he has honestly considered what appeared to him to be-all the circumstances bearing on the question whether proceedings should be allowed to go on. This being so, it is not for your Lordships, on this application for a mandamus, to consider whether the bishop's reasons are good or bad; whether they ought or ought not to have led him to form the Opinion he did.'

Therefore, the House of Lords has unanimously taken the view that when once jurisdiction has been given to an authority to form an opinion, the grounds for the formation of the opinion so formed cannot certainly be canvassed before the Courts.

89. In the decision reported in A I R 1956 S C 446, the Supreme Court had occasion to consider the expression 'as it may judge to be most for the benefit of the property and the advantage of the ward' occurring in Section 18 of the Bengal Court of Wards-Act, (9 of 1879). Section 18 is extracted by the Supreme Court at p. 451 of the report. It is also seen that the Supreme Court had to consider in that case--as to how far a party is entitled to challenge a decision that has been recorded under Section 18 of the said Act. In considering this question, Venkatarama Aiyar, J., at p. 452, speaking for the Court, quotes with approval the observations of Lord Bramwell and Lord Herschell which we have extracted earlier and occurring in 1891 A C 666. The learned Judge also observes that action taken under Section 18 oE the Court of Wards Act can be attacked on the ground that the Court of Wards did not act bona fide and in the interests of the ward, and that its action amounted to a fraud on the power. The learned Judge further states that it can also be attacked on the ground that the Court of Wards did not in fact apply its mind to the question whether the act was for the benefit of the property or the advantage of the ward, and that though it purported to exercise the power under Section 18, it did not, in fact, come to a judgment as required by the Section, But the learned Judge says that while once the Court of wards has applied its mind and given thought to the question whether the act is for the benefit of the property or the advantage of the ward, and comes to an honest judgment in the matter, then its decision is not liable to be questioned on the ground that it was erroneous on the merits, or that it was without considering some aspects which ought to have been considered, unless the failure to consider them is of such a character as to amount to there being no exercise of judgment at alt.

It is in this connection that the learned Judge refers to the observations of Lord Bramwell and Lord Herschell occurring in 1891 A C 686. Therefore, the Supreme Court had occasion to consider a somewhat similar expression as occurring in Section 4(1)(a) of the Act with which we are now concerned. Where power to arrive at a decision was solely left to the Court of Wards in that case under Section 18 of the Bengal Court of Wards Act, the Supreme Court came to the conclusion that so long as the decision of the Court of Wards is that the act is for the benefit of the property or the advantage of the ward, the grounds for that decision cannot certainly be reviewed by Courts.

90. The learned Advocate General also referred us to the decision of the Supreme Court reported in Swadeshi Cotton Milts v. State Industrial Tribunal, U. P., A I R 1981 S C 1381 for two purposes, namely that the Supreme Court had occasion to consider an expression similar to the one occurring in the statute before us, namely where the State Government has to form an opinion about a: particular matter, and also for the further proposition that even though there is no finding as such recorded in Ext. P2 to the effect that the State Government is of opinion that the petitioner has made wilful and unreasonably prolonged default, nevertheless that defect--if it is a defect--can be cured by the State Government by placing necessary materials before this Court on the basis of which it has formed the opinion under Section 4(1) of the Act.

91. In that case a decision of the State Government constituting an industrial tribunal and Conciliation Boards under Section 3 of the U. P. Industrial Disputes Act, came up for consideration before the Supreme Court. The section itself has been extracted at p. 1383 of the report. And so far as it is material for the present purpose, it will be seen that leaving off the unnecessary part, the Section reads: 'If, in the opinion of the State Government ......... it may, by general or special order, make provision ...... .', The provision referred to in the above extract gave power to Government to appoint Industrial Courts or refer any industrial dispute for conciliation or adjudication in the manner provided in the order, and certain other incidental matters. No doubt the constitutionality of the said Section was also challenged before the Supreme Court in that case on the ground that there is excessive delegation, but that contention was negatived by the Supreme Court. But the point that has now to be considered is the expression of opinion by the Supreme Court regarding the absence of any finding in the notification issued by the State Government under Section 3 of that Act regarding their having formed an opinion in respect of the matters mentioned in Section 3.

92. One of the grounds of attack that was raised before the Supreme Court was that the order itself was illegal inasmuch as the condition precedent for the exercise of the power, namely the formation of the opinion, is not referred to in the order and that the order must be struck down by the Court. The Supreme Court considers this contention raised by the parties and ultimately is of the opinion that in view of the affidavit filed by the State Government setting out the materials that were available before it for forming an opinion before issuing the notification under Section 3 of the Act, the notification issued by the State Government was perfectly valid. In this connection the Supreme Court states that the power to pass an order under Section 3 arises as soon as the necessary opinion required thereunder is formed and that opinion is naturally formed before the order itself is made. The Supreme Court further states that if such an opinion was formed and an order was passed thereafter, the subsequent order would be a valid exercise of the power conferred by the section. In particular the Supreme Court observes that the fact that in the notification which is made thereafter, the formation of the opinion is not recited, will not take away the power to make the order which had already arisen and led to the making of the order. The Supreme Court also emphasises that the validity of the order therefore does not depend upon the recital of the formation of the opinion in the order, but upon the actual formation of the opinion and the making of the order in consequence.

93. Therefore it will be seen that merely because the order Ext. P2 in the present case does not record the opinion of the Government, as required, in respect of matters referred to in Section 4(1)(a) of the Act on the basis of which action has been taken, it does not vitiate the order, especially as the records show in this case that the State has formed the opinion before issuing Ext. P2.

94. We may also refer to the recent decision of the Supreme Court reported in Mithoo Shahani v. Union of India, A I R 1964 S C 1536 wherein the Supreme Court had to consider the provisions contained in Section 33 of the Displaced Persons (Compensaetion and Rehabilitation) Act, 1954. Section 33 of the said Act was to the effect: 'The Central Government may at any time call for the record of any proceeding under this Act and may pass such order in relation thereto as in its opinion the circumstances of the case require and as is not inconsistent with any of the provisions contained in this Act or the rules made thereunder.' The Supremo Court in this case had to consider as to whether the formation of an opinion by the Central Government can be reviewed by Courts. In that connection Rajagopala Aiyangar J., speaking for the Court, observes at p. 1539 as follows :

'Whether the opinion which the Central Government entertained was correct or incorrect on the evidence, would, of course, not fall for consideration by this Court in an appeal under Article 136.'

But the Supreme Court dealt with another aspect, namely the contention that the order is illegal or invalid as distinct from its being incorrect.

95. The learned Advocate General next referred us to the decision of the Court -of Appeal in Ayr Collieries Ltd. v. Lloyd George, (1943) 2 All E R 546. The order, that the Court of Appeal had to consider was one under Regulation 55 (4) of the Defence General Regulations, wherein the operative part was to the effect that 'if it appears to a competent authority that in the interests of the public safety, the defence of the realm .......' The interpretation of this particular provision came up for consideration before the Court of Appeal; and Lord Green, M. R., at p. 547 observes :

'If one thing is settled beyond the possibility of dispute, it is that in construing regulations of this character expressed in this particular form of language, it is for the competent authority, whatever Ministry that may be to decide as to whether or not a case for the exercise of the powers has arisen.'

The Court of Appeal also says that it is for the competent authority to judge of the credibility of that evidence. And it further observes that it is for the competent authority to judge whether or not it is desirable or necessary to make further investigations before taking action. The Court of appeal observes that all those matters are placed by Parliament in the hands of the Minister in the belief that the Minister will exercise his powers properly and in the knowledge that, if he does not do so, he is liable to the criticism of Parliament. The Court of Appeal also very emphatically states that one thing is certain and that is that those matters are not within the competence o the Court of Appeal.

96. These decisions clearly lay down, in our view, that when the Legislature has left it to the authority concerned to form an opinion on certain matters, the grounds for the formation of the opinion, or the correctness of the opinion so formed by the authority concerned, do not fall for consideration for review at the hands of the Courts so long as the authority has acted honestly and there were materials available before it, on the basis of which such an opinion could be formed. In this case, we have already stated that the petitioner accepts the position that the various matters referred to in Ex. P1 relate to matters which he is required to do by or under the Act. If so, it follows that as in this case the formation of the opinion by the Government as such before passing the order Ex. P 2, is established, this court cannot consider either the grounds for the formation of that opinion or the correctness of the opinion, so formed by the Government.

97. Before closing the discussion on this aspect it is necessary now to consider as to whether the mere fact that provision has been made for the issue of notice under Sub-section (3) of Section 4 of the Act before taking action under Sub-section (1) of Section 4, constitutes the Government as a quasi-judicial authority and the decision rendered by it a quasi-judicial decision. In our opinion, the mere fact that provision for the issue of notice has been incorporated in Sub-section (3) of Section 4 does not in any manner constitute the State Government, in respect of action taken under Section 4(1)(a) of the Act, either a quasi-judicial authority; nor does it make it obligatory on its part to discharge its functions in a judicial manner. It has been laid down by the Supreme Court in two decisions, namely those reported in Province of Bombay v. Khushaldas S. Advani, AIR 1950 S C 222 and Radheshyam Khare v. State of Madhya Pradesh, AIR 1959 S C 107, that the mere fact that provision is made for issue of notice or for conducting certain inquiry before a decision is taken by a competent authority, will not make, what is otherwise an administrative action, into a quasi-judicial decision.

Das, J., in the first of the two decisions referred to above, at p. 261, after referring to the particular provisions of the statute, namely Sections 10 and 12 of the Ordinance, states that

'a mere provision for an inquiry as a preliminary step to coming to a decision will not necessarily make the decision a quasi-judicial act, for the purpose of the inquiry may only be to enable the deciding authority to make up its mind to do what may be a purely administrative act,'

More or less to the same effect is the decision of Das, C. J., in the latter decision referred to above, namely AIR 1959 S C 107, wherein the Supreme Court had to consider the nature of the functions performed by the State Government when taking action under Section 53-A, of the Central Provinces and Berar Municipalities Act (Act 2 of 1922). At p. 112 of the report, after extracting the particular provision, the learned Chief Justice states that the mere fact that an opportunity is given to the Municipality concerned before taking action, and calling for its explanation does not in any manner make the order passed by the Government which is purely of an administrative nature, into a judicial or quasi-judicial one. Therefore, the mere circumstance that there is a provision like Sub-section (3) introduced into Section 4 of the Act, does not, in our opinion, in any manner alter the position, namely that in taking action under Section 4(1)(a) of the Act the Government is essentially discharging only an administrative act and not a judicial or quasi-judicial act.

98. A direct decision on this point, even after introduction of Sub-section (3) into Section 4 ot the Act, is that of the Madhya Pradesh High Court reported in AIR 1963 Madh Pra 41. In that decision the learned Judges have considered the effect of introduction of Sub-section (3) into Section 4 of the Act. According to the learned Judges, the issue of notice is only to enable the Government to inform itself of more facts before forming an opinion as required by Section 4(1)(a) of the Act. We are in respectful agreement with the principles laid down by the Madhya Pradesh High Court in the decision referred to above, more especially as it is also in conformity with the decisions of the Supreme Court, to which we have already referred.

99. Then the question is as to whether in this case the contention of the learned counsel for the petitioner that there is absolutely no material available at all on the basis of which any reasonable authority could form an opinion that the petitioner has committed wilful and unreasonably prolonged default in doing anything required of him by or under the Act. So far as that is concerned, in our view, the statements made in the counter affidavit filed on behalf of the 1st respondent State Government will have to be accepted. The report of the Chief Engineer, Electrical, Ext. R 1, clearly shows that there have been allegations made against the petitioner regarding the defective manner in which his undertaking was being run from 1955; and particular emphasis was being laid on the fact that the voltage of the petitioner's undertaking was far below the standard provided for under Rule 54 of the Electricity Rules. We have already referred to the voluminous correspondence that passed between the petitioner and the various authorities. Under those circumstances, if a defect that was found to exist as early as 1955 was still found to continue as late as 1962 as is seen from the report Appendix III to Ext. R1, in our opinion, the conclusion arrived at by the State Government that there is wilful and unreasonably prolonged default committed by the petitioner in the running of his undertaking, cannot certainly be considered in any manner to be not supported by the materials on record, or unwarranted.

That the petitioner was fully made aware of all these defects is clearly seen from the replies that he has been giving to the various letters received by him from the Department. In fact, as late as 10th April 1962 under Ext. P 16 the petitioner expressed many difficulties, like branches of trees not being allowed to be cut down and difficulty in getting high tension cables and copper wire, etc. He also says in that communication that in view of all these circumstances he is doing his best to make further improvements in the undertaking. It will also be seen that notwithstanding the fact that the petitioner claims to have rectified all the defects as early as 13-8-1980, the defects that appear to have been rectified or remedied appear to be purely on a temporary basis. Under these circumstances, in our opinion, it cannot certainly be held that the formation of the opinion by the State Government for revoking the license of the petitioner's undertaking, is one arrived at on no materials.

100. One of the criticisms levelled by the learned counsel for the petitioner as against the action taken by the State Government is that after 13-8-1960 when the petitioner sent the communication Ext. P 25, there has teen no further complaint till the Electrical Inspector sends the communication nearly 2 years later, i.e., on 14-3-1982, evidenced by Ext. P 15. So far as that is concerned, the Government could have assisted this Court by giving fuller and better particulars regarding the various complaints and resolutions of public bodies that they had received in the meanwhile. In paragraph 4 of the counter affidavit filed on behalf of the 1st respondent State, they have particularly referred to the fact that complaints were received from the Kottayam Municipality complaining that 'the town is suffering heavily due to inefficient disorderly disregarded service of electrical energy.' It is also stared that complaints were received from the Chamber of Commerce, the Rubber Dealers' Association, Kottayam, the Kottayam Merchants' Association, and that resolutions were passed by the Kottayam Municipal Council and the District Development Council for taking steps to cancel the license of the petitioner's undertaking. That is why we said that the Government could have assisted this Court by giving fuller and better particulars regarding the several complaints and the dates of the resolutions along with the dates when those complaints and resolutions were received. But all those statements appear to be correct because in Ext. R 2 dated 21-6-1962 the State Government, while addressing the 2nd respondent Board, clearly refers to the fact that they have been receiving numerous complaints about the unsatisfactory working of the petitioner's undertaking from various individuals and organisations.

In particular they also refer to the fact that the District Development Council, Kottayam and the Municipal Council, Kottayam have passed resolutions requesting the Government to revoke the license granted to the petitioner's undertaking and arrange to supply power in the locality direct by the Electricity Board or Government. The Stats Government did not merely accept these resolutions on their face value; because they further proceed to state in Ext. R2 that in view of the complaints they have asked the Chief Engineer (Electricity) and Electrical Inspector to Government to conduct a detailed inquiry about the working of the system, and that alter inquiry the Chief Engineer has sent the report Ext. R 1 dated 28-5-1902. Ext. R 1 contains several enclosures including the inspection of the petitioner's undertaking on 19-5-1962 wherein according to the Superintending Engineer the voltage was still very poor. Therefore in view of all the circumstances the action of the Government cannot be said to be illegal or not justified.

101. We are not adverting to the various other charges that have been referred to in Ext. P1, because as we have already pointed out, the opinion that is formed by the Government under Section 4(1), is a subjective one which cannot be tested by objective standards. Inasmuch as we are satisfied that there were materials before the Government on the basis of which the Government could have formed the opinion, it is unnecessary to consider whether those charges mentioned in Ext. P1 are correct or not.

102. Therefore the result is that all the contentions taken by the learned counsel for the petitioner have to be negatived and this writ petition is dismissed. But parties will bear their own costs,


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //