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New Chhatabar Coal Co. Ltd. and anr. Vs. J.G. Kumarmangalam and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata High Court
Decided On
Case NumberMatter No. 144 of 1973
Judge
Reported inAIR1974Cal242
ActsCoal Mines (Taking Over of Management) Ordinance, 1973 - Sections 2, 3, 3(1), 3(2) and 17(1)
AppellantNew Chhatabar Coal Co. Ltd. and anr.
RespondentJ.G. Kumarmangalam and ors.
Appellant AdvocateR.C. Deb, Adv.
Respondent AdvocateAdv. General
Cases ReferredReginald John Burrell and The Honourable Patrick Kinnaird v. His Majesty
Excerpt:
- .....his powers under article 123(1) of the constitution of india promulgated an ordinance known as the coal mines (taking over of management) ordinance, 1973 (referred to as 'the said ordinance' hereinafter) for the purpose of taking over the management of coal mines containing coal pending the nationalisation of the said mines. the said ordinance came into effect on january 31, 1973. in the schedule to the said ordinance the names of 468 coal mines have been mentioned. the name of the said chhatabar colliery has not been mentioned in the said schedule.6. subsequently the central government in exercise of powers under section 3 (2) of the said ordinance has issued a declaration and published another schedule mentioning therein the names of further 208 coal mines. the said declaration was.....
Judgment:
ORDER

1. This application has been made for the issue of a Writ in the nature of mandamus directing the respondents to forbear from giving any effect to the Coal Mines (Taking Over of Management) Ordinance, 1973, in relation to the Chhatabar Colliery of the petitioner situated in Mouza Chhatabar. P.S. Nirsha in the district of Dhanbad. The application also seeks for the issue of a Writ in the nature of mandamus directing the respondents Nos. 1 to 8 to deliver back possession and management of the said Colliery to the petitioner. Rule nisi in terms of the aforesaid prayers was directed to be issued by me and I passed also at the time of the issue of the rule nisi certain ad interim orders which need not be mentioned now.

2. Mr. R.C. Deb appearing for the petitioners also prayed for an ad interim order directing the respondents Nos. 1 to 8 to restore back the possession of the said Colliery to the petitioners. At the time of the issue of the Rule I did not pass the said ad interim order but gave liberty to the petitioner to apply for the said ad interim order upon notice to the respondents.

3. Pursuant to the said liberty Mr. Deb, upon notice to the respondents for whom the learned Advocate-General of West Bengal appears, applied for the said ad interim order for restoration of possession of the said Colliery to the petitioners.

4. The petitioner No. 1 is the said New Chhatabar Coal Co. Ltd. (which will be referred to as 'the said Company' hereinafter). The shareholders and Directors of the said company are citizens of India. The company owns a colliery known as Chhatabar Colliery situate in Mouza Chhatabar, P.S. Nirsha in the district of Dhanbad, as stated hereinabove.

5. On or about January 30, 1973 the President of India in exercise of his powers under Article 123(1) of the Constitution of India promulgated an Ordinance known as The Coal Mines (Taking Over of Management) Ordinance, 1973 (referred to as 'the said Ordinance' hereinafter) for the purpose of taking over the management of coal mines containing coal pending the nationalisation of the said mines. The said Ordinance came into effect on January 31, 1973. In the schedule to the said Ordinance the names of 468 coal mines have been mentioned. The name of the said Chhatabar Colliery has not been mentioned in the said schedule.

6. Subsequently the Central Government in exercise of powers under Section 3 (2) of the said Ordinance has issued a declaration and published another schedule mentioning therein the names of further 208 coal mines. The said declaration was published and gazetted on February 8, 1973. Nonetheless the name of the said Colliery has not been included even in the said subsequent declaration and the schedule published as mentioned above. Notwithstanding the aforesaid, the respondents Nos. 1 to 8 have taken possession of the said colliery.

7. Mr. R.C. Deb appearing for the petitioners submitted :--

(1) Under the said Ordinance management of the Coal Mines which have been mentioned in the schedule to the said Ordinance, on the appointed day vested in the Central Government.

(2) Under the provisions of Section 3 (2) of the said Ordinance further 208 collieries mentioned in the subsequent declaration would be deemed to be included in the said schedule and management thereof has vested on the date of such declaration in the Central Government.

(3) Management of a Colliery not included in the schedule to the Ordinance, nor declared in terms of Sub-section (2) to Section 3 of the Ordinance has not vested in the Central Government.

(4) The Ordinance did not empower nor authorise the Central Government or the Custodian to take over possession of any colliery even if included in the schedule to the Ordinance or included in a subsequent declaration under Section 3 (2) of the Ordinance forcibly. The respondents Nos. 1 to 7 being public officers must act in accordance with the provisions of law and cannot forcibly take possession of any coal mines otherwise than under due process of law.

(5) The Central Government is obliged to take recourse to the machinery provided under the law of the land for the recovery of possession of any colliery, possession whereof is wrongfully withheld by the owners or erstwhile manager thereof.

8. According to Mr. Deb the entire Ordinance as a whole has to be read and given a meaning. Mr. Deb relied in support of his submission on the case of Gibson and Howes Ltd. v. William Lennon, (Secretary for Agriculture and Stock for Queensland), 24 Comm WLR 140 and in particular on a passage of the said judgment appearing at p. 157 of the said Report to the following effect:--

'............It is a fundamental error to detach the first portion of a section and settle its meaning first, ignoring even the rest of the section, and then proceed to apply the remainder of the section on the basis that the meaning of the first part is already fixed ......... We must read the whole section, and perhaps the whole Act, to ascertain the meaning of the first sentence of Section 20 (3) .........'

9. According to Mr. Deb in order to ascertain the Coal Mines, the management of which vests in the Central Government, we have to read the said Section 3 of the Ordinance in its entirety together with its Sub-sections and although Sub-section (1) to Section 3 of the said Ordinance lays down that on the appointed day the management of all Coal Mines shall vest in the Central Government, Sub-section (2) together with the proviso thereto makes it clear that only the Coal Mines which are specified in the schedule to the said Ordinance shall vest in the Central Government on the appointed day. Proviso to Sub-section (2) of the said section makes it clear that when the Central Government makes a declaration to the effect that management of any other mine found to contain coal shall vest in the Central Government, on and from the date when the Central Government makes a declaration to that effect in respect of the said mines, such Coal Mines shall be deemed to be included in the schedule to the Ordinance.

10. Thus, it is clear according to Mr. Deb that management of Coal Mines other than those mentioned in the schedule to the Ordinance or those which are the subject-matter of a declaration within the meaning of proviso to Sub-section (2) to Section 3 does not vest in the Central Government. Sub-section (2) in that sense really restricts the scope of Sub-section (1) of Section 3 and the word 'all' in the said section means 'all' included in the schedule and no other coal mine just as the word 'all' in Sub-section (1) of Section 3 cannot include coal mines situated outside the territory of India. If this construction be not accepted then according to Mr. Deb. Sub-section (2) and the proviso thereto would be meaningless, because if management of all Coal Mines situate in India vest in the Central Government then there was no necessily of making a declaration in terms of proviso to Sub-section (2) or of enacting Sub-section (2) itself.

11. Principles of construction as is well known lean against redundancy or superfluity. The above construction according to Mr. Deb is made all the more clear by the provisions of Sub-sections (4) and (5) to Section 5 of the Ordinance. Under the foresaid section there is no obligation to deliver possession to the Custodian in respect of mints not included in the schedule to the Ordinance.

12. The relevant provisions of the Ordinance which are necessary for our purpose are set out below:--

'3. (1) On and from the appointed day, the management of all coal mines shall vest in the Central Government.

(2) The coal mines specified in the Schedule shall be deemed, for the purposes of this Ordinance, to be the coal mines the management of which shall vest, under Sub-section (1), in the Central Government:

Provided that if, after the appointed day, any other mine is found, after an investigation, to contain coal, the Central Government shall make a declaration to that effect and on and from the date of such declaration :

(i) the management of such mine shall be deemed, for the purposes of this Ordinance, to vest in the Central Government; and

(ii) Such coal mine shall be deemed to be included in the Schedule, and thereupon the provisions of this Ordinance shall become applicable thereto subject to the modification that for the words 'appointed day' wherever they occur, the words, brackets and figures 'the date of the declaration made by the Central Government under Sub-section (2) of Section 3' shall be substituted.

(3) For the removal of doubts it is hereby declared that the Schedule includes those coal mines in relation to which the declaration made by the Coal Board to the effect that they contain coking coal is in dispute.'

'5. (1) The Central Government may, as soon as it is convenient administratively so to do, appoint any person as Custodian for the purpose of taking over the management of one or more coal mines and the person so appointed shall carry on the management of such mines for and on behalf of the Central Government.

* * * *(3) On the appointment of a Custodian under Sub-section (1), the charge of management of the coal mine shall vest in him and all persons in charge of the management of such mine immediately before such appointment shall cease to be in charge of such management and shall be bound to deliver to the Custodian all assets, books of account, registers or other documents in their custody relating to the coal mine, and any contract, whether express or implied, providing for the management of such coal mine, made before the appointed day between the owner of such mine and every such person, shall be deemed to have terminated on the date on which the Custodian is appointed.

(4) Hotwithstanding any judgment, decree or order of any Court or anything contained in any other law for the time being in force, the Official Liquidator or any Receiver appointed by any Court or any other person, in whose possession, custody or control any mine specified in the Schedule or any part thereof may be, shall forthwith deliver possession of the mine or such part thereof, as the case may be. to the Custodian. * * *'

13. Thus according to Mr. Deb it is clear from reading the aforesaid provisions that--

(a) The scheduled coal mines are the only mines the management whereof vest in the Central Government under Section 3 of the Ordinance on the appointed day.

(b) The Coal Mines declared under Sub-section (2) of the Ordinance shall be deemed to be included in the schedule and vest in the Central Government on the date of declaration and not on the appointed day. If all Coal Mines vest on the appointed day under Sub-section (1) to Section 3, whether mentioned in the schedule or not. then what was the necessity of having a schedule and what was the necessity for a declaration and 'deemed inclusion' in the schedule of coal mines declared with different dates of vesting.

14. The intention of the legislature, that is to say, the President of India in the instant case promulgating the Ordinance, is further made clear according to Mr. Deb from the publication in the Statesman, of a notice a copy whereof has been annexed as Annexture 'B' to the petition. The said publication is set out hereunder :--

'COAL MINES AUTHORITY,

Government of India,

Ministry of Steel & Mines,

Dept. of Mines,

6, Lyons Range, Calcutta-1.

NOTICE TO ALL CUSTOMERS OF COAL MINES AS NOTIFIED IN SCHEDULE TO THE COAL MINES (TAKING OVER OF MANAGEMENT) ORDINANCE, 1973, PUBLISHED IN THE GAZETTE OF INDIA. DATED 30TH JANUARY. 1973.

I, Shri J. C. Kumarmangalam, Chairman, National Coal Development Corporation and Custodian General of the Coal Mines Authority, under the provision of the Coal Mines -- (Taking Over of Management), Ordinance No. 1 of 1973 do hereby notify to all customers to whom these Coal Mines have sold their products or who have any dues owing to them, that the Management of these Mines has been taken over by Central Government and now vests under the Custodian working under my General Supervision from 31st January, 1973.

In accordance with Section 5 (10) of the Ordinance Central Government shall receive to the exclusion of all other persons any moneys due to the Coal Mines realised after the appointed day notwithstanding that such receipts pertain to the transaction made at any time before the appointed day.

I, hereby notify to all the customers that all payments against dues arising out of transactions prior to the appointed day of take over are to be made in the form of crossed 'account payee' cheque or demand draft payable to Coal Mines Authority with the name of the unit which despatched the product, and forward it along with the details of the payment to my office at the address given below so that they are sorted out and credited to the appropriate collieries account maintained by the Custodians on their behalf.

Coal MinesAuthority,

Sales Account Department,

6. Lyons Range,

4th Floor,

Calcutta-1.'

J. G.Kumarmangalam,

Custodian General

31-1-1973.

15. The said notice makes the intention of the Government of India clear and shows that the ordinance applied only to the mines mentioned in the schedule to the Ordinance.

16. Any other interpretation of the section would lead to absurdity in view of the two different dales for vesting of management of Coal Mines and postponement of the application of the Ordinance to non-scheduled mines.

17. In the schedule to the Ordinance 464 mines were mentioned. Further 208 mines were subsequently declared by notification dated 8th February, 1973. The Government thus has been implementing the Provisions of the Ordinance in the same manner as contended by Mr. Deb. Mr. Deb therefore says that the possession taken of the said Colliery or coal mine was contrary to the provisions of law and taken illegally and status quo ante should be restored and pays for ad interim orders in terms of prayers (i) and (j). In support of his contention Mr. Deb relied on the cases of Thompson v. Park, (1944) 2 All ER 477 and Heywood v. B.D.C. Properties Ltd.. (1963) 2 All ER 1063.

18. The learned Advocate-General appearing for the Custodian contended : --

(a) The proviso to Sub-section (2) of Section 3 of the Ordinance distinguishes classes of mines whose dates of vesting is postponed. If curbs out of a particular class of mines out of the coal mines mentioned in Sub-section (1) to Section 3. The classification has a rational basis.

(b) If Mr. Deb's contention to accepted. Section 17 of the Ordinance would become redundant.

The said Section 17 reads as follows: --

'17. Nothing contained in this Ordinance shall apply lo any coal mine--

(a) owned, managed or controlled by a Government company or by a corporation which is owned, managed or controlled by Government;

(b) owned or managed by a company engaged in the production of iron and steel:

Provided that Clause (b) shall not extend to such part of the coal mine or production thereof which, in the opinion of the Central Government, is in excess of the requirements for the production of iron and steel by the company owning or managing such coal mine:

Provided further that any coal obtained from any such coal mine as is referred to in the foregoing proviso in excess of the requirements for the production of iron and steel by the company owning or managing such coal mine shall not be sold delivered, transferred or otherwise disposed of except with the previous approval of the Central Government.'

19. Section 17, according to Mr. Deb has been put in by way of abundant caution. It deals not only with mines owned but also managed.

20. It appears to me, however, that Coal Mines, according lo the Ordinance, are mines in which there exist one or more seams of coal [Sec Section 2 (b) of the Ordinance] and the Ordinance defines 'mines' lo be 'any excavation where any operation for the purpose of searching for or obtaining minerals has been or is being carried on.' Thus although there may be seams of coal, the same would not belong to a mine or be a coal mine unless mining operations arc carried on in respect of the same within the meaning of different clauses of Section 2 (g) of the Ordinance.

21. The management of all coal mines within the meaning of the definition clause given by the Ordinance must vest in the Central Government on the appointed day under Sub-section (1) of Section 3. If subsequent to that date any other mine come into existence as a result of mining operation in terms of Section 2 (g) of the Ordinance be found to contain coal vesting clause contained in Sub-section (1) of Section 3 of the Ordinance would not apply to such coal mines and declaration in relation to the same has to be made under proviso to Sub-section (2) to Section 3 of the Ordinance so that management thereof may vest in the Central Government. Sub-section (1) of Section 3 would not apply to such coal mines inasmuch as they were not in existence as coal mines on the appointed day.

22. Sub-section (2) to Section 3 is a deeming provision. That has been included in order to obviate all possible difficulties. The management of the coal mines mentioned in Sub-section (2) of Section 3 shall be deemed to vest in the Central Government notwithstanding the fact that management thereof has already been vested in the Central Government under Sub-section (1) of Section 3 of the Ordinance. Reference in this connection may be made to the case of Reginald John Burrell and The Honourable Patrick Kinnaird v. His Majesty's Attorney-General on behalf of His Majesty, 1937 AC 286.

23. The words 'deemed to pass' appearing in Section 2 of the Finance Act, 1894 came to be considered by the house of Lords in the aforesaid case and it -was held that property was 'deemed to pass' notwithstanding that a person who becomes entitled to the beneficial enjoyment of a property on a date had already before that date been beneficially interested in the property.

24. Sub-sections (4) and (5) of the Ordinance did not envisage cases of all coal mines management whereof is vested by the Ordinance but only those and in the circumstances mentioned in the said Subsections.

25. Sub-section (3) of the said Section 5 on the other hand contemplates by and large almost all the coal mines with the exception of those mentioned in Sub-sections (4) and (5) of the said Section 5. Sub-section (3) does not mention the schedule or any declaration.

26. Section 17 mentions the coal mines excluded or exempted of the applicability of the provisions of Section 3 of the Ordinance and could not have been enacted if the intention of the legislature WAS to vest only the management of the coal mines mentioned in the schedule or declared subsequently by notification as mentioned in the proviso to Sub-section (2) of Section 3 of the Ordinance.

27. It is clear that as envisaged in the cases of (1944) 2 All ER 477 and (1963) 2 All ER 1063 mentioned above, Court has power to direct the restoration of status quo ante in a proper case.

28. But in view of my reading of Section 3 of the said Ordinance as mentioned hereinabove I am unable to accept the contention of Mr. Deb and thus do not make any further ad interim order in this application. I must note here that the view I have taken in this matter is only prima facie.

29. Mr. Debnath appearing for the petitioner prays for extension of the returnable date as the Rule nisi has not yet been drawn up and delivered to his Solicitor. The returnable date is therefore extended until 9th May, 1973.


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