Petition under Article 32 of Constitution

A. Scope of Article 32 of the Constitution of India

The sole object of the Article 32 of the Constitution of India is the enforcement of
the fundamental rights guaranteed under Part III of the Constitution of India.
Whatever other remedies may be open to a person aggrieved he has no right to
complain under Article 32 !here no fundamental right has been infringed. It
follo!s that no "uestion other than relating to a fundamental right !ill be
determined in a proceeding under the Article 32 including interlocutory reliefs. A
!rit under the said Article 32 !ould not lie to enforce the #overnment policy or a
$irective Principle.
Article 3% dealt !ith right to property. The said Article !as deleted by the &&th
Amendment Act %'() !hereby the provisions of the said Article 3% !ere deleted
and provisions of Article 3**A !ere incorporated. +y reason of deletion of the said
Article 3% from the Part III of the Constitution the right to property cease to e,ist
as a fundamental right and therefore no! it is not possible to file a !rit in the
-upreme Court of India under Article 32 for enforcing and.or challenging the right
to property. /o!ever a !rit may lie under Article 220 of the Constitution of India
to the /igh Courts.

+. Application under Articles 32 and 226
Article 32 and Article 220 both deal !ith enforcement of right of the citi1en
against the #overnment or #overnmental Authorities. /o!ever the scope of
Article 32 is limited to the e,tent of enforcement of the fundamental rights stated
in the Part III of the Constitution !hereas the scope of Article 220 of the
Constitution is much !ider than Article 32 of the Constitution. The /igh Court
!hile e,ercising the Article 220 can give reliefs in case of "uasi23udicial Tribunals
and authorities or other acts by such lo!er authorities even though the acts of
such authorities do not infringe the fundamental rights.
The -upreme Court is competent to give relief under Article 32 against any
authority !ithin the territory of India. The po!er of /igh Court under Article 220
is confined to its territorial 3urisdiction so that even !here fundamental rights
have been infringed the /igh Court cannot grant reliefs against an authority
located outside its territorial jurisdiction e,cept in certain e,ceptional cases
namely !here the causes of action arises in !hole or in part !ithin territorial
jurisdiction of that Court. /o!oever a !rit against 4nion of India can be filed in
any /igh Court in India.

C. Amplitude of Supreme Court's jurisdiction under Article 32
The po!ers given to the -upreme Court under Article 32 for the enforcement of
fundamental rights are not confined to issuing prerogative !rits only and are not
necessarily circumscribed by the conditions !hich limit the e,ercise of the
prerogative !rits. The said Article is !ide enough to consider even claims for
compensation arising from the violation of fundamental rights. The range of
judicial revie! recognised in the superior judiciary of India is perhaps the !idest
and the most e,tensive 5no!n to the !orld of la!. The po!er e,tends to the
e,amining the validity to even an amendment to the Constitution. 6o Constitution
amendment can be sustained !hich violates the basic structure of the
Constitution.

$. Who may apply under Article 32
Any person !ho complains of infraction of any of the fundamental rights
guaranteed by the Constitution is at liberty to move the -upreme Court including
corporate bodies e,cept !here the language of the provisions or the nature of
right compels the inference that they are applicable only to natural persons.
Conversely one cannot apply under Article 32 in respect of a fundamental rights
!hich he does not possess. There are certain fundamental rights !hich are
confined on citi1en alone vi1. rights under Article %' of the Constitution. A non
citi1en cannot therefore apply for the enforcement of any such rights. +ut a non
citi1en or a company or a statutory authority may apply for enforcement of any of
the fundamental rights !hich have been confined on all persons under Article %&
of the Constitution.

7. Applicability of Article 32 to the Public Interest Litiation
In recent times the -upreme Court has even considered and given reliefs in
public interest litigation under Article 32 of the Constitution.

!" #$pansion of Public Interest Litiation
%. This e,traordinary jurisdiction !as e,ercised by the -upreme Court for the
enforcement of fundamental rights in its jurisdiction under Article 32
!here t!o 8a! Professors addressed a letter to the -upreme Court
complaining that the fundamental rights of the inmates of the Protective
/ome under Article 2% !ere being violated by the #overnment /ome.
2. In #upta9s case :AI; %')2 sec. %&'< !here 4pendra9s case :%')3< 2 sec.
3*) !as referred to the doctrine of public interest litigation !as
formulated by a +ench of ( 3udges in a comprehensive form to apply to
any case of public injury arising from =
a. the breach of any public duty or
b. the violation of some provision of the Constitution or
c. of the la!.
3. Though the doctrine !as initially applied by the -upreme Court to enforce
fundamental rights under Article 32 it soon came to be applied by the
/igh Courts in their jurisdiction under Article 220 not only to enforce
fundamental rights but also to restrain the 7,ecutive from undermining the
public interest. As the #overnment is encouraging sports grant of lease of
land for that purpose even at concessional rates cannot be said to be not
to subserve the public purpose.

%" Application under Article 32 aainst an order of ta$ation
%. Though the right not to be ta,ed e,cept by authority of la! is embodied in
Article 20> !hich is not a fundamental right an application under Article
32 !ill lie if that ta, relates to a person9s right to carry on a business or
profession and thus constitutes an infringement of his fundamental right
guaranteed by rights %&? %>? %':%<:g<.
2. Where the impugned order is a "uasi2judicial order !hich violates the
fundamental right application under Article 32 !ill lie if such order is =
i. made under an ultra vires statute or rule?
ii. !ithout jurisdiction though the statute may be intra vires or
iii. made under a procedure !hich is ultra vires?
iv. violative of principles of natural justice !hich is also regarded as an
instance of order !ithout jurisdiction.
2. +ut an application under Article 32 !ill not lie !here the order of the
ta,ing or other "uasi2judicial authority !hich has violated a fundamental
right is ultra vires though based on a misconstruction of the la! or an
error of fact.
In The -upreme Court of India 6e! $elhi
Civil @riginal 3urisdiction
Writ Petition 6o. of %''>
In the matter of Article 32 of the Constitution of India.
And
In the matter of Articles %& %' :%< :g< 3%A 3%C 3**A 3*% and 3*& of the
Constitution of India.
And
In the matter of Te,tile 4nderta5ings :Ta5ing @ver of Aanagement< Act %')3
And
In the matter of judgment and order of the $ivision +ench of the +ombay /igh
Court dated 3*th 3une %')& in Writ Petition 6o. 2&*% of %')3
And
In the matter of various orders passed by this /onBble Court in Civil Appeal 6o.
2''> and companion appeals and interim applications therein
And
In the matter of Te,tile 4nderta5ings :6ationalisation< @rdinance %''> :6o. 0 of
%''><
dated 2(th 3une %''>
And
In the matter of constitutional validity of the Te,tile 4nderta5ings :6ationalisation<
@rdinance %''>.
To
The /onourable -hri A. -. Anand
Chief 3ustice of India
And @ther /onourable Puisne 3ustices
@f the -upreme Court of India 6e! $elhi.
The
/umble
Petition of
the
Petitioners
Abovenam
ed
Aost ;espectfully -he!eth C
%. +y this petition under Article 32 of the Constitution of India the Petitioners see5
to challenge the constitutional validity of the Te,tile 4nderta5ings :6ationalisation<
@rdinance %''> :6o. 0 of %''>< DEthe @rdinanceE for shortF and the conse"uent
actions proposed to be ta5en pursuant thereof. The Petitioners submit that the
said @rdinance is clearly ultra vires the Constitution and violative of Articles %&
%' :%< :g< and 3**A of the Constitution of India. The said @rdinance is clearly a
colourable e,ercise of the legislative po!er :e,ercised by the e,ecutive< by the
;espondents. The said @rdinance is also in teeth of the mandate of Article 3**A of
the Constitution of India. +esides the @rdinance is apparently aimed at nullifying
the various orders passed by this /onBble Court !hich have been completely
breached by the ;espondents and they are clearly in contempt of those orders as
demonstrated hereinafter. +esides the facts and circumstances of the case
demonstrate that there !as not an iota of urgency or circumstances as envisaged
under Article %23 of the Constitution for promulgation of @rdinance. The
@rdinance is clearly unconstitutional null and void and the same is liable to be so
declared for !hich purpose the Petitioners are approaching this /onBble Court.

2. The brief facts and bac5ground giving rise to the filing of this petition is narrated
hereinafter.
%. Petitioner 6o. % is a joint stoc5 company e,isting under and governed by
the provisions of the Companies Act I of %'>0 and has its registered office
at Gamani Chambers ;. Gamani Aarg +allard 7state +ombay &** *3).
Petitioner 6o. 2 is the Principal @fficer.$irector and shareholder of the %st
Petitioner and is national and citi1en of India.

2. ;espondent 6o. % is the 4nion of India. ;espondent 6o. 2 is the -ecretary
Ainistry of 8a! and 3ustice and Company Affairs :8egislative $epartment<.
;espondent 6o. 3 is the 6ational Te,tiles Corporation 8td. :E6TCE for short<
!ho !ere appointed custodian under the provisions of the Te,tile
4nderta5ings :Ta5ing over of Aanagement< Act %')3 :E the %')3 ActE for
short< to !hom no! the assets of the te,tile underta5ings sought to be
nationalised under the impugned @rdinance are to be transferred and then
to be vested in the said 6TC. ;espondent 6o. & is subsidiary corporation of
respondent 6o. 3.

3. The Petitioner Company has been engaged in the manufacture of te,tile
prior to %')2. The Petitioner Company has been performing its
manufacturing activities e,tremely !ell upto %'('2)*. @n %)th 3anuary
%')2 a general stri5e !as declared in the te,tile industry at +ombay !hich
stri5e had disastrous effect on the functioning of all the te,tile units in
+ombay. The stri5e !as continuing on %)th @ctober %')3.

&. @n %)th @ctober %')3 the Te,tile 4nderta5ings :Ta5ing over of
Aanagement< @rdinance %')3 !as promulgated and the possession of the
Petitioners9 te,tile underta5ing !as ta5en over at 2.3* a.m. on the
morning of %'th @ctober %')3 !ith the help of police force. The said
@rdinance !as later on passed into Act of parliamentary. The @rdinance
and subse"uently the Act proclaimed that it !as passed to ta5eover the
management of %3 te,tile underta5ings mentioned in the Hirst -chedule in
the public interest? one of them being the PetitionerBs te,tile underta5ing.
It !as further recited that the circumstances compelled the ta5eover of the
management of those %3 te,tile underta5ings. The Petitioner Company is
listed at serial 6o. % of the Hirst -chedule of the %')3 Act a copy of the
said Act of &* of %')3 is anne,ed hereto as Anne,ure2A.

>. The Petitioners thereupon filed Writ Petition 6o. 2&*% of %')3 in the /igh
Court at +ombay challenging the constitutional validity of the said %')3
@rdinance and subse"uently the %')3 Act and other conse"uential reliefs.
The petitioners crave liberty to rely upon the papers and proceedings of
the said !rit petition and various affidavits filed therein.

0. The said !rit petition filed by the Petitioners herein !as heard by the
$ivision +ench of the +ombay /igh Court along !ith other companion !rit
petitions and the said !rit petition by a judgment and order dated %3th
3une %')& !as allo!ed and the %')3 @rdinance.Act !as declared as
unconstitutional inter alia insofar as it pertained to the Petitioners te,tile
underta5ing. The $ivision +ench ho!ever granted certificate under Article
32 of the Constitution of India to the ;espondents herein to appeal to this
/onBble Court. A copy of the said judgment dated %3th 3une %')&
delivered by the $ivision +ench of the +ombay /igh Court is anne,ed as
Anne,ure I+B.

(. The Petitioners state that thereafter ;espondent 6o. % as also ;espondent
6o. 3 have filed appeals in this /onBble Court being Civil Appeal 6o. 2''>
and other companion appeals. @n those appeals various orders have been
passed !hich are summarised as under.
a. The appeals filed by 4nion of India and ;espondent 6o. 3 as also
various other parties !ere heard on %%th $ecember %')& %2th
$ecember %')& %3th $ecember %')& %)th $ecember %')& %'th
$ecember %')& 2*th $ecember %')& and %>th 3anuary %')>.
b. @n %(th 3anuary %')> an order !as passed by the +ench of three
3udges of this /onBble Court under !hich it !as directed that the
Civil Appeals as also the interim applications therein be heard by a
+ench of not less than five 3udges. A copy of the said order dated
%(th 3anuary %')> is anne,ed as Anne,ure ICB.
c. @n 22nd 3anuary %')> the three 3udgesB +ench of this /onBble
Court passed the follo!ing order as regards the PetitionersB
underta5ing is concerned.
:i< 6TC !as directed to furnish to the Petitioners "uarterly
statement of profit J loss balance sheet monthly statement of
stoc5s production and employment in respect of their use and
management of the PetitionersB te,tile underta5ing from %')3
on!ards.:ii< The 4nion of India and 6TC !ere restrained from
disposing of parting !ith possession or encumbering any
immovable property fi,ed asset land plant and machinery of the
Petitioners !ithout prior leave of the court.:iii< The 4nion of India
and 6TC !ere restrained from removing any plant e"uipment
furniture or fi,ture from the premises of the PetitionersB te,tile
underta5ing !ithout leave of the court.:iv< The e,isting telephone
connections of the directors of the Petitioner Company !ere
directed not to be disconnected.:v< The 6TC !as directed to
prepare inventory of all assets and other properties both movable
and immovable from 2'th 3anuary %')> from day2to2day.:vi< The
6TC !as directed to hand over the register of contracts register of
directors register of charges unissued shares scrips minute boo5s
of +oard Aeetings and #eneral +ody Aeetings.A copy of the order
dated 22nd 3anuary %')> is anne,ed as Anne,ure I$B.
d. @n 23rd 3anuary %')> on order !as passed by the +ench of three
3udges of this /onBble Court in !hich it !as recorded that the
possession of the registered office premises of the Petitioner
Company !ill be restored by the 4nion of India and 6TC to the
Petitioners and this possession !ill continue !ith the company
during the pendency of the appeal. The cars of the Petitioner
Company ta5enover by 6TC !ere also directed to be returned to
the Petitioner Company. A copy of the order dated 23rd 3anuary
%')> is anne,ed as Anne,ure I7B.
The Petitioners state that each one of the above order and particularly the
order dated 22nd 3anuary %')> has not been fully complied !ith by the
;espondents inasmuch as no steps have been ta5en !hatsoever by the
;espondents to comply !ith the same and furnish to the Petitioners
necessary particulars and information as directed to be so furnished under
the said order dated 22nd 3anuary %')>. Thus non2compliance !ith the
order of this /onBble Court. The Petitioners have also learnt that the
;espondents have disposed of the assets of the PetitionersB te,tile
underta5ings contrary to and in breach of the orders passed by this
/onBble Court particularly the above order.
%. The Petitioners believe that in Aay %''> the 4nion Cabinet
had approved the revised Turnaround plan for the 6TC
subject to the follo!ing stipulations?
i. The retrenchment of !or5men !ould be underta5en
at large scale and voluntary retirement scheme !ould
be offered to reduce the number of !or5men
strength by 32'3).
ii. To modernise 2' te,tile mills at a cost of ;s. 2**>.(2
crores.
iii. ;e2structuring of 20 mills stated to be unviable into
%) viable mills :as regards the PetitionersB mills is
concerned that it is to be merged !ith #old Aohur
and 3am Aills or Tata Aills<.
iv. 6ationali1ation of %> ta5eover mills.
v. The funds for the moderni1ation are to be generated
by sale of surplus lands and assets of these 6TC
mills.
vi. That the functioning of the Turnaround plan should be
met e,clusively by sales proceeds of surplus lands
and assets and no budgetary provision !ould be
made for the same.
2. In this bac5ground the Petitioners !ere shoc5ed to learn that on 2nd 3une
%''> the +ill !as introduced in the 8o5 -abha being +ill 6o. &%.'> 5no!n
as the Te,tile 4nderta5ings :6ationalisation< +ill %''>. The statement of
objects and reasons for the +ill recited that pending nationalisation
management of the PetitionersB underta5ing and %2 other te,tile
underta5ings !ere ta5enover in public interest. It !as further recited that
it !as necessary to ensure continued production and distribution of
different varieties of cloth and yarn to the public at fair prices and the
interests of !or5men !ere also to be protected. The government also
proposed to modernise and restructure the underta5ing to ma5e them
viable and hence it !as proposed to nationalise the %> te,tile underta5ings
in public interest. The copy of the said +ill along !ith the statement of
objects and reasons PresidentBs recommendation under Article %%( of the
Constitution of India and the financial memorandum are anne,ed as
Anne,ure IHB.
%. The Petitioners further state that the aforesaid +ill !as introduced
in 8o5 -abha. This +ill for purported nationali1ation !as introduced
after a period of %2 years after the ta5eover of management. The
Petitioners further state that the +ill is referred to the 3oint
Parliamentary Committee for Commerce for consideration to !hom
the Petitioners have made subse"uently certain representations.
The consideration of the +ill !as thus deferred pending
recommendations.report of the said Committee. The Petitioners
submit that Article 3%A permits ta5eover of management for a
limited period of time. /o!ever %2 years can never be considered
as a limited period of time at end of !hich the +ill for
nationali1ation !as introduced and in this bac5ground !hilst the
+ill introduced in 8o5 -abha !as pending before the 3oint
Parliamentary Committee an @rdinance !as sought to be
promulgated on 2(th 3une %''> as mentioned hereinafter. The
@rdinance promulgated under Article %23 of Constitution of India
clearly did not precede e,istence of any emergency or urgency for
ta5ing such a step of legislation by e,ecutive. Thus the conditions
precedent for issuance of @rdinance under Article %23 !ere and are
clearly absent.

3. In this bac5ground the Petitioners !ere shoc5ed to learn that on 2(th
3une %''> the @rdinance has been promulgated 5no!n as Te,tile
4nderta5ings :6ationalisation< @rdinance %''> :6o. 0 of %''><. It is
recited in the said @rdinance as underC
i. The @rdinance is stated to be to provide for ac"uisition and transfer
of te,tile underta5ings and the right title and interest of the o!ners
in respect of te,tile underta5ings.
ii. Pending nationalisation the management of the te,tile
underta5ings !as ta5enover.
iii. 8arge sums of money have been invested !ith a vie! to ma5e the
te,tile underta5ings viable.
iv. Hurther investments of very large sums of money !ere necessary
for the purpose of securing optimum utilisation of the available
facilities for the manufacture production and distribution of cloth
and yarn.
v. It !as necessary for securing continued employment of the
!or5men.
vi. It !as necessary in the public interest to ac"uire te,tile
underta5ings to ensure the interest of general public.
The copy of the said @rdinance is anne,ed as Anne,ure I#B.

2. The Petitioners submit that the salient features of the said @rdinance are
as under C
%. The provisions of the @rdinance are deemed to have come into
force on %st April %''& !hich is described as appointed day.
2. I@!nerB has been defined in -ection 2:g< to mean any person
immediately before the appointed day !as immediate proprietor or
lessee or occupier of the te,tile underta5ing or any part thereof
and the said definition reads thus C
E2:#< Eo!nerE !hen used in relation to a te,tile underta5ing
means any person or firm !ho or !hich is immediately before the
appointed day the immediate proprietor or lessee or occupier of the
te,tile underta5ing or any part thereof and in the case of a te,tile
company !hich is being !ound up or the business !hereof is being
carried on by a li"uidator or receiver includes such li"uidator or
receiver and also includes any agent or manager of such o!ner but
does not include any person or body of persons authorised under
the Te,tile 4nderta5ings :Ta5ing over of Aanagement< Act %')3 or
under the 8a,mirattan and Atherton West Cotton Aills :Ta5ing over
of Aanagement< Act %'(0 to ta5eover the management of the
!hole or any part of the te,tile underta5ingE?
3. ITe,tile CompanyB has been defined in sub2section :%< of -ection 2
!hich reads thus C
E2:%< Ete,tile companyE means a company :being a company as
defined in the Companies Act %'>0< specified in column :3< of the
Hirst -chedule as o!ning the te,tile underta5ing specified in the
corresponding entry in column :2< of that -chedule?E
&. -ection 3 provides that on the appointed day the right title and
interest of the o!ner in relation to every te,tile underta5ings shall
stand transferred to and shall vest absolutely in Central
#overnment. -ub2section :2< provides that every te,tile
underta5ings !hich stands vested in Central #overnment shall
stand transferred and vested in the 6ational Te,tile Corporation.
>. -ection & provides the effects of vesting the assets and properties
of the te,tile underta5ings first in the Central #overnment and then
in the 6TC and those effects generally are thus C
:a< The assets of te,tile underta5ing are deemed to be inclusive of
all movable.immovable properties and lands etc. in India as !ell as
abroad and shall also be deemed to include the liabilities and
obligations specified in sub2section :2< of -ection >.:b< The
property on vesting shall be freed and discharged from any trust
obligation encumbrances mortgage charge lien etc. :c<. The
licences granted to the o!ner shall stand transferred to 6TC.:c< The
licences granted to the o!ner shall stand transferred to 6TC.:d< The
mortgagor of the property !hich vest in Central #overnment and
6TC thereafter is re"uired to give intimation to the Commissioner
appointed as Commissioner of Payments under -ection %(.:e< @n
the appointed day any suit appeal or other proceedings in respect
of the property shall not abate and be discontinued but may be
continued or prosecuted or enforced by or against the 6TC.
0. -ection > provides that the o!ner shall be liable for liabilities of the
te,tile underta5ings e,cept those specified in sub2section :2< in
respect of any period prior to the appointed day. The liabilities
e,cluded are the follo!ingC
:a< 8oans advanced by the Central #overnment or -tate
#overnment after the %')3 @rdinance.:b< The amounts advanced
to te,tile underta5ings after the management of the underta5ing
!as ta5enover by the %')3 Act.:c< Wages salaries and other dues
in respect of any period after the management !as ta5enover by
the Central #overnment under the %')3 Act.
(. -ub2section :3< of -ection > provides that e,cept the liabilities
provided in sub2section :2< in relation to te,tile underta5ings prior
to appointed day shall be enforceable against the Central
#overnment or 6TC.
). -ection ) provides that the o!ner of the te,tile underta5ings shall
be given in cash an amount e"ual to amount specified in the Hirst
-chedule. Hor the PetitionersB underta5ing the amount specified is
;s. &>0')***.2.
'. -ection %* provides for management of the te,tile underta5ings by
6TC.
%*. -ection %% provides that 6TC may for the better management
modernisation restructuring or revival of te,tile underta5ing !ith
the previous sanction of the Central #overnment may transfer
mortgage sale or other!ise dispose of any land plant machinery
or any other asset of the te,tile underta5ing.
%%. -ection %( provides for appointment of Commissioner for Payments
for the purposes specified in the said section.
%2. -ection 2* provides for ma5ing claims before the Commissioner for
Payments against the o!ner and -ection 2% provides for priority of
the claims as provided in the -econd -chedule to the @rdinance.
The priorities are classified as Categories % 2 3 & > and 0 !hich
are to ta5e precedence over the other one. Categories % and 2 are
included in the -chedule of the post ta5eover management period
and apparently under -ection 2% these liabilities are to get
precedence and therefore they !ould be paid over to the respective
claims !ho !ould ma5e claim under -ection 2* before the
Commissioner for Payments !hich !ill virtually !ipe out the
amount payable to the o!ner as specified in the Hirst -chedule.
2. The Petitioners state that the +ill referred to hereinabove is reproduced
verbatim by !ay of the impugned @rdinance !as presented in the 8o5
-abha on the last day of the budget session. After learning about the
same here !as !idespread protest against the same from all circles
including trade industry labour as also the -tate #overnment. The copy of
the ne!spaper reports are anne,ed as Anne,ure I/B. The Petitioners
further submit that the +ill has been referred to the Parliamentary
-tanding Committee. The Petitioners therefore made a representation on
%*th 3uly %''> to the said Committee re"uesting them for the hearing. The
Petitioners received a communication dated %*th 3uly %''> fi,ing the
hearing on %2th 3uly %''> !hich has been postponed at the re"uest of the
Petitioners to %&th 3uly %''>. The copies of the above t!o letters both
dated %*th 3uly %''> are anne,ed as Anne,ures IIB and I3B. The Petitioners
submit that this seems to be a classic case of the governmental functioning
of right hand being una!are of the activities of the left hand.
2. The Petitioners made representation dated %2th 3uly %''> to the Parliamentary
Committee on Te,tile. In this representation Petitioners pointed out the
circumstances in !hich the management of the te,tile underta5ings !as
ta5enover. The Petitioner pointed out the judgment of the +ombay /igh Court in
!hich the said Act of %')3 so far as it pertains to the PetitionersB underta5ing !as
struc5 do!n and the appeal pending in this /onourable Court. The Petitioners also
pointed out the complete mismanagement of the PetitionersB te,tile underta5ing
by 6TC and pointed out that it !as not in anybodyBs interest to nationali1e the
PetitionerBs underta5ing as it !ould be further ruination of the underta5ing and
neither the production !ill increase nor the employment !ill be continued as the
proposals being circulated in respect of the PetitionersB underta5ing !ere not the
revival of the unit but the closure thereof and sale of land and merging the unit
!ith some other mill. The Petitioners made a reference to the earlier
representation made by them to the /onourable Ainister on the subject matter
being representation dated 2'th August %')> as also the representation dated
%st -eptember %''2. A copy of the representation dated 2'th August %')> is
anne,ed as Anne,ure IGB hereto. A copy of the representation dated %st
-eptember %''2 is anne,ed as Anne,ure I8B. A copy of the representation made
by the Petitioners to the Parliamentary Committee being representation dated
%2th 3uly %''> is anne,ed as Anne,ure IAB hereto. The Petitioners submit that
this is yet another factor this /onBble Court be pleased to ta5e into account !hile
judging the constitutional validity of the impugned @rdinance.
A. The Petitioners state that it appears that on 3%st 3uly %''> in the
monsoon session of Parliament the /onBble Ainister of -tate for Te,tile Ar.
#. Ken5atas!amy introduced the +ill for converting the impugned
@rdinance into Act. A discussion too5 place and various members have
pointed out that promulgation of the @rdinance !as !holly contrary to the
parliamentary practices and it virtually amounted to ridiculing the
Parliament. This !as stated on the footing that earlier on 2nd 3une %''>
the +ill !as already introduced in the Parliament and thereafter the same
!as referred to the -tanding Committee !hich !as e"uivalent to the
-elect Committee on the +ills and in this bac5ground on 2(th 3une %''>
the @rdinance !as promulgated. The /onBble Ainister !as as5ed by the
$eputy -pea5er !hether the @rdinance could not !ait !hen the +ill !as
pending before the -tanding Committee. The /onBble Ainister Ar. Au5ul
Wasni5 made the follo!ing statementC
EThere !as an urgency !hich had necessitated the revival of these te,tile
mills. There !as certain recommendation made even by the -pecial
Tripartite Committee !hich !as constituted by the Ainistry of 8abour. If
the /onBble member !ants I can go through the entire statement and read
it out for his information. +ut these !ere the reasons that I have
e,plained. Hor the revival of these te,tile mills it !as felt necessary to
issue the @rdinances as soon as possible and therefore the @rdinance had
to be issued.E
The Petitioners crave liberty to refer to and rely upon the proceedings of
8o5 -abha as regards the discussion on the introduction of the +ill for
convert the impugned @rdinance into a Parliament enactment.
2. The Petitioners submit that the events !hich have transpired from %')3 after
ta5eover of the management of the PetitionersB te,tile underta5ing by the
;espondents and handing over it to the 6TC particularly the 6TCBs subsidiary
6ational Te,tile Corporation :-outh Aaharashtra< 8imited till the promulgation of
proposed @rdinance. These events also thro! light and clearly indicate the
arbitrariness and unreasonableness of the impugned @rdinance. These events are
summari1ed thus C
i. The 6TC has in operation %*> nationali1ed te,tiles and %> managed mills
including the PetitionersB underta5ing !hich are operated through its '
subsidiary corporations. The authorised capital of 6TC is ;s. >** crores
and paid2up capital is ;s. &>(.)> crores.
ii. There are hundreds of unviable sic5 te,tile mills allover the country in
respect of !hich neither the #overnment nor 6TC have ta5en any steps.
iii. As per the figures available relating to the functioning of 6TC the
accumulated net losses of 6TC as on 3%st Aarch %''> are ;s. &>)& crores
!hich is the provisional estimate. @ut of ' subsidiary corporations of 6TC
) have lost their net !orth and they have been declared as sic5 industrial
companies under the provisions of the -ic5 Industrial Companies :-pecial
Provisions< Act %')> and the references are pending before the +IH;. The
reasons claimed by 6TC for such losses are lac5 of ade"uate moderni1ation
of solid machinery high mode and machine ratio e,cess manpo!er and
shortage of !or5ing capital.
c. The matters have been referred to +IH; including the 6TC :-outh
Aaharashtra< 8imited !hich is the custodian for the PetitionersB
te,tile underta5ing. The Petitioners have learnt that in the scheme
proposed by the Te,tile Ainistry before the +IH; the follo!ing
points have been discussed and submitted for consideration C
a. -ince +an5s and financial institutions are reluctant to pump
in any more funds into operations of 6TC the functioning of
6TC is neither trust!orthy nor economical and 6TC having
defaulted in repayments has to generate its o!n funds.
b. -urplus lands are proposed to be disposed of to utilise
interest free funds for moderni1ation !or5ing capital and to
ma5e the 4nits viable.
c. The mills !ill be merged !ith each other and on such merger
surplus lands !ould be made available and moderni1ation
proposal !ill be !or5ed out by raising ;s. 2**> crores.

b. The "uestions have been as5ed in Parliament on the functioning of
the 6TC and particularly the functioning of the mills in +ombay of
!hich management has been ta5enover by the ;espondents under
%')3 Act. The local A.P. !ithin !hose jurisdiction the PetitionersB
te,tile underta5ing falls? i.e. Central +ombay A. P. Ar. Aohan
;a!ale had as5ed the "uestions in 8o5 -abha and highlighted the
mismanagement by 6TC and corruption and inefficiency !hich it
had engulfed. The Petitioners crave liberty to refer to and rely upon
the proceedings of discussion in 8o5 -abha on this subject as !hen
the same are available.

c. Petitioners state that as mentioned earlier ' subsidiary corporations
of 6TC have become sic5 under the provisions of the -ic5 Industrial
Companies :-pecial Provisions< Act %')> and references are
pending before +IH; on !hich various orders have been passed.
Petitioners have obtained copies of those orders !hich are
summari1ed as under C
a. In respect of 6TC :-outh Aaharashtra< 8td. an order !as
passed by +ench IK of +IH; on 20th @ctober %''& and
operating agency has been appointed. The order proceeds
on the footing of representations made in +ombay Te,tile
;esearch Association report. A copy of the order dated 20th
@ctober %''& is anne,ed as Anne,ure E6E hereto.
b. The Petitioners state that similar orders have been passed in
respect of the other 6TC subsidiaries. @n 2(th April %''>
order has been passed in respect of the mills in Aaharashtra
!herein the +ench directed all concerned parties including
the -tate of Aaharashtra to submit their proposals on the
draft scheme prepared by the operating agency. A copy of
the order dated 2(th April %''> is anne,ed hereto as
Anne,ure I@B.

d. The Petitioners state that although they do not have the copy of the
-cheme from the ne!spaper reports it appears that the scheme is
to sell the surplus lands of the te,tile mills including that of the
PetitionersB te,tile underta5ing merger of some mills !ith others
and on that basis revival !ith voluntary retirement scheme it has
been reported in $ecember %''& that the +IH; has turned do!n
the proposals of sale of the lands of the mills for use for other
te,tile mills. Copy of these ne!spapers are anne,ed hereto as
Anne,ure P.

e. In Aay %''> it has been reported that the +IH; -pecial +ench at
its hearing held on 2*th April %''> has ordered that since Te,tile
Ainistry and 6TC holding Company did not give its consent for
rehabilitation scheme I$+I the operating agency has been directed
to e,plore the possibilities of finding a private promoter for revival
of sic5 6TC units. Copy of the ne!spaper report is anne,ed hereto
as Anne,ure L.

f. The Petitioners further submit that time and again ne!s reports
have been appearing on the functioning of 6TC !hich clearly
indicate that the 6TC has been the !hite elephant generated by the
4nion #overnment and all the units of 6TC all run at the cost of the
management and !or5men of the te,tile underta5ing !hich have
been ta5enover for management. The basic premise on !hich the
PetitionersB te,tile underta5ing !as ta5enover vi1 mismanagement
though this ground !as rejected by the +ombay /igh Court is the
root cause of the malfunctioning of 6TC and it is the 6TC !ho has
mismanaged the te,tile underta5ings including the PetitionersB
underta5ing. -ome of the ne!s reports !hich have appeared in the
past on this subject demonstrate this point beyond doubt are
summari1ed as under C
a. It !as reported in -eptember %''2 :Hinancial 7,press dated
%2th -eptember %''2< that #overnment itself !as planning
to return ( mills :including Petitioners Aill< subject to certain
terms and conditions and the proposal !as not acceptable to
the Aillo!ners. A copy of the paper cutting is anne,ed as
Anne,ure ;.

b. In the issue of Clote, India -eptember %''2 the
functioning of 6TC has been analy1ed !herein the proposals
about sales of surplus land merger of mills etc. have been
discussed. Copy of the said article is anne,ed hereto as
Anne,ure -.

c. The Ainister of -tate for Te,tile Ar. #. Ken5atas!amy has
clearly blamed 6TC for malfunctioning of te,tile mills !hich
has been reported in the press :Times of India dated (th
April %''3 copy !hereof is anne,ed as Anne,ure T.

d. The reasons for 6TCBs failure including corruption mis2
management have been analy1ed in an editorial :Aid $ay
dated %*th Hebruary %''&<.

e. ;evival plan by pac5age of sale of lands and purchase of
modern machinery has been discussed !hich !as apparently
submitted to +IH; :Times of India dated 2%st Hebruary
%''& 7conomic Times dated 2%st Hebruary %''& @bserver
dated 2%st Hebruary %''& Hinancial 7,press dated 2%st
Hebruary %''& copies !hereof are anne,ed as Anne,ure 4
hereto.

f. In Hebruary %''& a tripartite meeting !as held bet!een
8abour Ainistry Te,tile Ainistry and 6TC !here (' sic5 6TC
mills !ere suggested to be moderni1ed :7conomic Times
dated %%th Hebruary %''& Times of India dated %%th
Hebruary %''& Aid $ay dated (th Hebruary %''& Hinancial
7,press dated &th Hebruary %''& M copies !hereof are
anne,ed hereto as Anne,ure K<.

g. The /onBble -pea5er of 8o5 -abha re"uested the
#overnment to come out !ith a statement of the reasons
!hich are causing 6TCBs failure :Times of India dated %*th
Aarch %''&<.

h. The President of ;ashtriya Aill Aa1door -angh had
suggested in Aarch %''& that 6TC has failed to ta5e any
remedial measures and for revival of Aills the Aills should
be restored to the o!ners or they should be privatised
:Indian 7,press dated %*th Aarch %''& being Anne,ure W
hereto<.

i. @n 2>th 3uly %''> a ne!s report appeared in Asian Age
reporting that 6TC !as to sell e,cess land of %> te,tile mills
!hich !ere sought to be ta5enover under the impugned
@rdinance. It !as mentioned that since the real estates
prices in +ombay !ere 1ooming. Ar. Aahesh!ari Aanager of
Industrial ;elations at 6TC -outh Aaharashtra -tate stated
that useless lands belonging to each of these mills !ould be
sold to raise funds to upgrade the technology in the mills.
The mills of !hose properties !ere sought to be sold inter
alia include 7lphinstone Aills? i.e. the PetitionersB te,tile
underta5ing. A copy of the said ne!s report is anne,ed
hereto as Anne,ure N.

j. @n 3%st 3uly %''> a ne!s report appeared in Indian 7,press
reporting that large number of employees of 6TC -outh
Aaharashtra had not been paid their !ages bac5 !ages
gratuity fund etc. and hundreds of cases !ere pending in the
8abour Courts Industrial Courts /igh Courts and even the
-upreme Court.
A copy of the said ne!s report is anne,ed as Anne,ure O.
5. @n 3%st 3uly %''> in Times of India ne!s report on the
functioning of 6TC appeared under the caption E#od save us
from the bureaucratsE. It !as reported that the idea of
nationalising %> te,tile units including the Petitioner !as to
raise ;s. 2**> crores to be funded by sale of lands. It !as
pointed out that the capacity utilisation of 6TC in spinning
units had dropped from (*P to >'P and in !eaving units
from 0)P to 2)P. The sale had dropped from ;s. 0>'
crores to ;s. 3%& crores. It !as further stated that on one
hand privatisation of public sector unit !as being underta5en
to ma5e them more efficient and on the other hand other
units !ere being nationalised and handedover to one of the
most inefficient P-4s namely the 6TC. It !as further
reported that the Ainister of -tate for Te,tile Ar. #.
Ken5atas!amy had himself stated in %''3 that high level
corruption in 6TC !as responsible for poor status of the
mills. A copy of the said report is anne,ed as Anne,ure Q.
l. @n %st August %''> a ne!s report appeared in -tatesman
Calcutta and /industan Times 6e! $elhi in !hich the
proceedings of 8o5 -abha in !hich the #overnment !as
criticised on the @rdinance !ere reported. A copy of these
t!o reports are anne,ed as Anne,ure AA.
%. The Petitioners submit that a starred "uestion !as
as5ed in ;ajya -abha on functioning of 6TC and the
losses incurred by the 6TC the brea5 up of losses
and steps #overnment proposes to ta5e or have
already ta5en. This "uestion !as ans!ered by the
/onourable Ainister of Te,tiles -hri #. Ken5atas!amy
on 2>th April %''> in !hich it !as mentioned that the
accumulated losses suffered by 6TC for the three
years ending %''2 %''3 and %''& !ere ;s. 232*
;s. 3**3 and ;s. 3('* crores respectively. It !as
stated that a revised Turn2around strategy !as under
consideration and the final scheme !ould be
submitted to +IH;. As regards PetitionersB te,tile
underta5ing is concerned the accumulated net losses
for the years ending %''2 %''3 and %''& in crores
!ere ;s. 3.03 >.(& and %%.)% respectively. -ome
other "uestions !ere also ans!ered about the
functioning of the 6TC. Copies of the "uestions and
ans!ers from the ;ajya -abha proceedings dated
2>th April %''> are anne,ed as Anne,ure ++ hereto.

g. The Petitioners believe that in respect of PetitionersB te,tile
underta5ing the scheme submitted before +IH; envisages the
closure of the spinning and !eaving unit and merger thereof !ith
some other sic5 mill and generating funds by sale of surplus land
belonging to the PetitionersB company.

h. The Petitioners submit that from the aforesaid it is evident that
!hat the ;espondents proposed through +IH; scheme as also of
the impugned @rdinance is e,actly contrary to !hat they are
professing to do under the %')3 Act as also the impugned
@rdinance? vi1 augmenting manufacturing capacity for yarn and
cloth continuation of the unit and continuation of the !or5 force in
employment and preventing reduction in the employment force are
all frustrated and in fact not even aimed at as is evident and
obvious from the schemes proposed before the +IH; and the entire
plan envisaged by the ;espondents. The Petitioners submit that this
single factor alone is sufficient to establish that the impugned
@rdinance is clearly arbitrary unreasonable and violative of
PetitionersB constitutional rights under Article %& %' :%< :g< and
3** of the Constitution of India.

2. In the circumstances aforesaid the Petitioners are approaching this /onBble Court
invo5ing its e,traordinary jurisdiction under Article 32 of the Constitution of India
challenging the aforesaid @rdinance? vi1. Te,tile 4nderta5ings :6ationalisation<
@rdinance %''> :6o. 0 of %''>< on the follo!ing amongst other grounds. 7ach of
the grounds set out hereinbelo! is !ithout prejudice to one another.
%. The Petitioners submit that the impugned @rdinance is a continuation of
the scheme of management underta5en in %')3 by virtue of %')3 Act. The
Petitioners submit that %')3 Act and the %''> @rdinance are thus
ine,tricably lin5ed and they cannot stand apart. The Petitioners submit
that the %''> @rdinance proceeds on the footing of the %')3 Act being
ultra vires !hich in fact has been declared ultra vires by the +ombay /igh
Court in the case of the PetitionersB te,tile underta5ing. Thus the premises
of the impugned @rdinance is clearly !rong and is a subject matter
pending before this /onBble Court before a +ench of not less than >
3udges. The Petitioners therefore submit that until the validity of the %')3
Act is finally determined by this /onBble Court the ;espondents could not
have underta5en the proposed legislation !hich has been so underta5en by
the impugned @rdinance as the impugned @rdinance cannot stand on its
o!n and therefore is liable to be declared as ultra vires. The Petitioner
submits that the @rdinance !hich is subject matter of the Petition covers
only %> te,tile underta5ings of !hich the management !as ta5enover in
%')3. /o!ever there are around %** mills closed !hich have not been
touched by the present @rdinance. This clearly sho!s the ne,us bet!een
the %')3 Act and the present @rdinance.

2. The Petitioners further submit that the %')3 Act !as only for the purpose
of preventing mismanagement in the te,tile underta5ing and it !as the
only reason for ta5ing over the te,tile underta5ings including the
PetitionersB te,tile underta5ing. In fact on a clear finding of fact the
+ombay /igh Court in its judgment dated %3th 3une %''& in Writ Petition
6o. 2&*% of %')3 has observed in respect of the PetitionersB te,tile
underta5ing thus C
E%)*. @n the admitted position the financial condition of all the mills
during %')% and %')2 including the PetitionersB three mills !as bad. In fact
as compared to the financial condition of certain mills in CAT 2 the
position of the PetitionersB mills !as better. In that case from the mere
circumstances that the financial condition of the PetitionersB mill !as bad
during %')%2)2 no inference could be dra!n that the same !as due to any
mismanagement even if the terms !ere used in the sense of
bad.improper management by the Petitioner Company. The #overnment
therefore could not have for ta5ing over the management of the said
mills relied on the said CATs for classifying the PetitionersB mills as mills
!hose financial condition !as bad due to mismanagement.E
E2*&. In our vie! the above discussion !ould sho! that 4nion of India has
failed to establish from any material on record that there !as any ne,us
bet!een the main object or purpose of the Act namely to ta5eover
management of only those mills !hose financial condition before stri5e as
!holly unsatisfactory by reason of mismanaement and classification of
Petitioner mills as such mills. In fact under the circumstances the Petitioner
millsB inclusion in the class covered by the Act !as arbitrary. The impugned
@rdinance.Act therefore infringed the PetitionersB fundamental right under
Article %& of the Constitution and "ua them !as invalidE.
Thus it is evident that the PetitionersB te,tile underta5ing !as not
mismanaged and therefore in %')3 the management thereof could not
have been ta5en over. The Petitioners submit that from %)th @ctober %')3
till %st April %''& :the appointed day under the impugned @rdinance< the
position of the PetitionersB te,tile mills and the underta5ing is !ith the
;espondents only by virtue of the orders of this /onBble Court and not by
virtue of the %')3 Act !hich has been declared ultra vires insofar as it
pertains to the Petitioners. The basic foundation of the present legislation
therefore is clearly unsustainable and the impugned @rdinance therefore
on that count is liable to be declared as unconstitutional and ultra vires.

3. The Petitioners submit that the #overnment of India is a signatory to the
treaty of World Trade @rganisation :WT@<. The Petitioners submit that in
vie! of changed 7conomic 8iberalisation Policy of the #overnment !hich
has been accepted allover the !orld and Indian acceptance of World Trade
@rganisation Charter the concept of nationalisation is anti2thesis to the
concept of liberalisation. In fact on one hand large number of public sector
underta5ings are being disinvested so as to put them in the hands of
better and efficient measures for their efficient and effective functioning
and on the other hand the te,tile units li5e the Petitioners unit is sought to
be nationalised and to be handed over by vesting it into the most
inefficient and corrupt public sector underta5ing in this country namely
6TC and its subsidiaries 6TC -outh Aaharashtra 8td. These concepts are
clearly anti2thesis of economic liberalisation and the present policies !hich
have been subscribed by all the policy ma5ers all over the country and
accepted and acted upon allover the !orld. The Petitioners submit that the
provisions of the legislations and the Constitution are no! re"uired to be
interpreted liberally in vie! of the ne! economic liberalisation policy as
also ne! industrial policy. Kie!ed in this perspective the Petitioners
submit that it is clear that the impugned @rdinance is clearly ultra vires
and unconstitutional.

&. The Petitioners submit that the impugned @rdinance is clearly in teeth of
the PetitionersB rights under Articles %& %' :%< :g< and 3**2A of the
Constitution of India inasmuch as the entire scheme of the @rdinance is
clearly e,propriatory and unreasonable restriction on the PetitionersB rights
under Articles %& and %':%<:g< of the Constitution of India. The provisions
of the impugned @rdinance ma5e it abundantly clear that it is manifestly
unreasonable arbitrarily and capricious inasmuch as it contemplates the
virtual e,propriation of the o!ner of the te,tile underta5ing as
demonstrated in this petition. @n this count alone the said @rdinance is
liable to be declared as unconstitutional and ultra vires.

>. The Petitioners further submit that by virtue of the Te,tile 4nderta5ings
:Ta5ing over of Aanagement< Act %')3 the management of the
PetitionersB underta5ing !as ta5enover by the Central #overnment and
entrusted to the custodian M ;espondent 6o. 3 herein. The provisions of
the said Act proceeded on the footing that there !as mismanagement in
respect of the PetitionersB underta5ing and therefore it !as e,pedient for
the better management of the underta5ing and for the interest of the
!or5men to ta5eover the management of the te,tile underta5ing. The
Petitioners submit that by a judgment and order of the $ivision +ench of
the +ombay /igh Court dated %3th 3une %')& the said Act insofar as it
pertains to the Petitioners has been declared ultra vires and
unconstitutional. The said judgment is in appeal in this /onBble Court and
the management continues to be !ith the ;espondents because of the
orders granted by this /onBble Court on %(th 3anuary %')> 22nd 3anuary
%')> and 23rd 3anuary %')>. +ut for these orders the management and
the possession of the te,tile underta5ings !ould have to be reverted bac5
to the Petitioners. The basic premise of the impugned @rdinance therefore
is clearly absent and on this count also the purported object of the
impugned @rdinance is clearly absent and the said @rdinance therefore is
unreasonable arbitrary and thus contrary to the mandate of Article %& of
the Constitution of India.

0. The Petitioners submit that it has been declared in the preamble that the
@rdinance has been promulgated for the ac"uisition and transfer of te,tile
underta5ing and the right title and interest of the o!ners in respect
thereof to the Central #overnment and then to 6TC. The object of such
ac"uisition is proclaimed to be augmenting the production and distribution
of different varieties of clothes and yarn so as to subserve the interest of
the general public. It is further declared that !hilst the management has
been ta5enover !hich is according to the @rdinance !as pending
ac"uisition large sums of money have been invested to ma5e the te,tile
underta5ing viable and further investments of large sums of money !as
necessary and it !as also necessary for securing the continued
employment of the !or5men employed in the te,tile underta5ing and it
!as therefore necessary in the public interest to ac"uire the said te,tile
underta5ing. The Petitioners submit that each of the assertions made in
this preamble is completely false and is a bogie created for the ac"uisition
of the PetitionersB te,tile underta5ing for a pittance. Thus the ac"uisition of
the PetitionersB te,tile underta5ing is neither in the public interest nor for
any public purpose and is virtually e,propriation of the Petitioners !ithout
ma5ing a just compensation for such ac"uisition. @n this count the
@rdinance is liable to be declared as ultra vires and violative of Articles %&
%' :%< :g< and 3**2A of the Constitution of India.

(. The Petitioners submit that the impugned legislation is not protected either
by Article
3%2A or by Article 3%2C as it is not for any purpose of implementing the
directive principles under Article 3' :b< and.or 3' :c< of the Constitution of
India. As held by this /onBble Court that from this legislation in the instant
case the @rdinance it has to be demonstrated that the Act is in fact made
for the purposes of implementing the directive principles contained in
clauses :b< and :c< of Article 3' and a mere proclamation or professing to
that effect is not sufficient. In the instant case it is clearly demonstrable
from the te,t of the @rdinance that the same is not for any purpose of
implementing the directive principles contained in clauses :b< and ' :c< of
Article 3' and if at all it is anything to the contrary as such the impugned
@rdinance has to satisfy on the touch stone of validity !ith reference to
Articles %& and %' :%< :g< !hich it clearly fails. The said @rdinance
therefore is liable to be declared as clearly unconstitutional and violative of
Articles %& and %' :%< :g< of the Constitution of India.

). The Petitioner submits that neither the %')3 Act nor the impugned
@rdinance contain a declaration under Article 3%C to the effect that the
impugned @rdinance is for apparently giving effect to the principles
contained in clauses :b< and :c< of Article 3' of the Constitution. The
Petitioners submit that there are large number of legislations !hich the
Petitioners have listed separately in a chart sho!ing the nationalisation and
ac"uisition Acts containing such declaration and the decision of challenges
to such enactments and the legislations containing no such declaration and
the decision of challenges to such enactments. The Petitioners submit that
!hen the Parliament consciously puts a declaration in certain enactments
!hilst it consciously does not put such declaration in certain enactments it
has to have a significance and the inclusion of a declaration and their being
no such declaration has to be clearly vie!ed in a different perspective. The
Petitioners submit that in this bac5ground it is submitted that the
;espondents cannot contend that the Act is protected by Article 3%C unless
a declaration to that effect is made in the legislation itself. The Petitioners
submit that !ithout prejudice to the aforesaid contention even assuming
!ithout admitting that such a declaration is not necessary and it could be
gathered from the legislation itself the impugned @rdinance gives no such
indication and on the contrary positively it can be established that the
impugned @rdinance is not the one for giving effect for the principles given
in clause :b< and :c< of Article 3' of the Constitution. The Petitioners
submit that on this count also the impugned @rdinance is liable to be
declared as unconstitutional under Articles %& and %' :%< :g< of the
Constitution.

'. The Petitioners further submit that after the @rdinance 6o. %* of %')3 !as
promulgated on )th @ctober %')3 and possession of the underta5ing !as
ta5enover by the Central #overnment and handed over to ;espondent 6o.
3 as custodian they have completely mismanaged the said underta5ing
the !or5ersB strength has reduced and the cash losses have increased
tremendously. +efore the Te,tile AillsB general stri5e Petitioners te,tile
underta5ings functioning !as absolutely normal. 7ven during the general
stri5e by Petitioners efforts functioning of te,tile underta5ing !as improved
and just before ta5eover it !as brought to almost normalcy. The
Petitioners submit that the assertions that the ;espondents have invested
huge sums of money and it is necessary to invest further sums as also it is
necessary to augment the !or5 force for production and distribution of
different varieties of cloth is completely false and bogus as before the
ta5eover of the management the !or5ing of the PetitionersB te,tile
underta5ing !as much better than !hat as it has become after %)th
@ctober %')3. -ince last about one year the Petitioners te,tile underta5ing
is completely closed. Hor month of 3une %''> no salaries have been paid.
The !or5force and production has reduced considerably. The Petitioners
have compiled a comparative data and the figures of the !or5ing of the
PetitionersB te,tile underta5ing after %)th @ctober %')3 !hich is anne,ed
as Anne,ure ICCB !hich justifies this point.

%*. The Petitioners further submit that under -ection > the liabilities of the
underta5ing e,cept those specified under sub2section :2< are enforceable
against the o!ner of the te,tile underta5ing. -ub2section :2< contemplates
liabilities by !ay of loans advanced to the te,tile underta5ing by the
governments amounts advanced or the !ages salaries and other dues of
the employees etc. It is contemplated that the e,propriated o!ner shall be
paid an amount e"uivalent to the one specified in the Hirst -chedule. In
respect of the PetitionersB underta5ing the amount specified is ;s.
&>0')***.2. /o!ever the said amount is not the compensation payable
to the petitioners as it is to be adjusted by the Commissioner for Payments
as per the scheme of part KI of the said @rdinance !hich contemplates
that the Commissioner shall settle out of the amount payable to the o!ner
of the te,tile underta5ing of > categories as specified in the -econd
-chedule and the priority has been given to Categories % to 0 !hich ta5e
precedence over the another. -urprisingly and shoc5ingly the liabilities in
categories % and 2 are the post ta5eover management period !hich are
also to be satisfied out of the amount payable to the e,propriated o!ner
out of the pittance of compensation payable to him. The Petitioners submit
that this is the most shoc5ing and grossest provisions of the @rdinance
!hich ma5es the !hole @rdinance unconstitutional and violative of
mandate of Articles %& and %' :%< :g< as also 3**2A of the Constitution of
India.

%%. The Petitioners further submit that the $ivision +ench of the +ombay /igh
Court has declared in its judgment dated %3th 3une %')& that there !as
no mismanagement of the PetitionersB underta5ing and the %')3 Act of
ta5ing over the management of the PetitionersB underta5ing !as
unconstitutional. The management and possession of the te,tile
underta5ing of the Petitioners is continued !ith the ;espondents only by
virtue of orders passed by this /onBble Court in the pending appeals as
mentioned earlier? vi1. the orders dated %(th 3anuary %')> 22nd 3anuary
%')> and 23rd 3anuary %')>. Apart from the above the ;espondents
having completely flouted and breached those orders the possession and
management of the te,tile underta5ing continued !ith the ;espondents is
only by virtue of the said orders and not by virtue of the %')3 Act !hich is
struc5 do!n insofar as it pertains to the Petitioners. In this vie! of the
matter the Petitioners submit that the impugned @rdinance is a clear
frauid of po!er by ;espondent 6o. % in promulgating the said @rdinance
for nationalisation of the PetitionersB te,tile underta5ing. The Petitioners
submit that on this count the impugned @rdinance is liable to be struc5
do!n and declared unconstitutional.

%2. The Petitioners submit that in any vie! of the matter the ;espondents had
purported to ta5eover the management of the PetitionersB te,tile
underta5ing from %)th @ctober %')3 on the ground of mismanagement of
the underta5ing. The Petitioners submit that after %)th @ctober %')3
!hatever liabilities have been incurred by the ;espondents cannot be
fastened upon the Petitioners !hich is sought to be done by the impugned
@rdinance. The Petitioners submit that on the other hand the management
of the te,tile underta5ing of the Petitioners !as ta5en over !ith effect from
%)th @ctober %')3 !hich is continued by virtue of the orders of this
/onBble Court and no! !hat is sought to be done is all post ta5eover
management liabilities of the te,tile underta5ing are sought to be
deducted from the compensation payable to the Petitioners for ac"uisition
of the te,tile underta5ing. The Petitioners submit that this is the most
unfair and grossest provisions of the impugned @rdinance !hich ma5es it
completely unsustainable and violative of mandate of Articles %& %' :%<
:g< and 3**2A of the Constitution of India.

%3. The Petitioners submit that the %')3 legislation !as a ta5eover of
management legislation and !as sought to be justified under Article 3%2A
:%< :b< !hich authorises the 8egislature to ta5eover the management for a
limited period. The Petitioners submit that assuming !ithout admitting for
the sa5e of arguments the contentions of the ;espondent about the
mismanagement such ta5eover of management is permissible only for a
limited duration of time and a period of %3 years from %')3 can by no
stretch of imagination be considered as a limited period and hence on that
count also the %')3 Act must fail. The %')3 Act being the basic foundation
of the impugned @rdinance it must also of necessary fail and on this count
the impugned @rdinance is also liable to be declared as unconstitutional.

%&. The Petitioners submit that it is mentioned that the e,propriated o!ner !ill
be paid an amount specified in the Hirst -chedule subject to priority of
claims as mentioned in -econd -chedule under -ections 2% 22 23 and
2( of the Act. As far as the Petitioners are concerned a sum of ;s.
&>0')***.** is stated to be the amount payable. /o!ever no basis
!hatsoever has been disclosed either in the @rdinance or in accompanying
document to the earlier +ill !hich is reproduced in verbatim by !ay of the
present @rdinance. In fact the Petitioners have learnt that the ;espondents
themselves have valued the assets of the PetitionersB te,tile underta5ing to
the tune of ;s. %** crores !hereas the amount payable is ;s. & crores and
odd !hich is also subject to deductions as per the priorities mentioned in
the -econd -chedule !hich priorities first include the post management
ta5eover period liabilities incurred by the ;espondents themselves. The
Petitioners submit that they have large land area. The available H-I :Hloor
+ased Inde,? i.e. permissible buildable area< on the basis of %C33.
Considering the present mar5et value at a conservatives estimate of ;s.
&***.2 per s". ft. H-I the value in monetary terms for the lands of the
Petitioners company !or5s out more than ;s. 2** crores. +esides the
value of the Petitioners plant and machinery etc. as of $ecember %''2 is
;s. &>3.23 lacs and all these assets are sought to be ta5enover for a
meagre sum of ;s. &>0')***.2 !hich demonstrates its illusoriness. Thus
the impugned @rdinance purporting to provide compensation of ;s. &
crores and odd is clearly and demonstrably e,propriatory. The amount of
so called compensation is neither just e"uivalent of mar5et value nor a
non2illusory amount and is clearly an illusory amount and on this count
also the same is liable to declared so.

%>. The Petitioners submit that the purported amount of compensation of ;s.
&>0')***.2 payable to the PetitionersB te,tile underta5ing is a pittance
compared to its real value. +esides the said compensation is not payable to
the Petitioner but is liable to be appropriated as per the priority prescribed
in -chedule II of the Act. The priority include the post ta5eover
management period liabilities created by the mismanagement of the unit
by the ;espondents 2 6TC. The Petitioners submit that the post ta5eover
liabilities inter alia include the trade liabilities and creditors etc. of the
te,tile underta5ing of the Petitioners run by 6TC. The Petitioners have
figures available from the ;espondents from the accounts for the years
%')02)( %'))2)' and provisional profit and loss account for %st
-eptember %''& to 3%st $ecember %''&. The losses for this period alone
is ;s. 22*.>' la5hs. The losses for the previous years for !hich the
Petitioners have got the figures are to the tune of ;s. (%%.>' la5hs and the
net losses for the years %''%2'2 %''22'3 and %''32'& as disclosed by
the ;espondents in ;ajya -abha are ;s. 3.03 ;s. >.(& and ;s. %%.)%
crores. These are supposed to be post ta5eover liabilities !hich are to be
satisfied from the compensation payable to the Petitioners !hich is ;s.
&>0')***.2. The Petitioners have !or5ed out these figures in a separate
statement in tabular form compiled from figures and documents by 6TC
itself. This chart is Anne,ure CC hereto. Thus it is clearly evident that
there is no surplus of even one paise available after discharging the post
ta5eover liabilities. In fact the compensation is not sufficient enough for
even the post ta5eover liabilities. Thus for the mismanagement and
negligence of the ;espondents the Petitioners are made to suffer. The
Petitioners therefore submit that the impugned @rdinance is thus clearly
e,propriatory and confiscatory in nature and is therefore liable to be
declared as unconscionable and violative of Articles %& %' :%< :g< of the
Constitution of India. Hor the acts of omission and commission of the
;espondents themselves the liabilities are sought to be fasten upon the
Petitioners. This is clearly impermissible.

%0. The Petitioners further submit that as demonstrated earlier the purported
6ationalisation is for augmenting the coffers of 6TC and to subsidise and
under!rite their losses !hich have been incurred by virtue of sheer
mismanagement corruption inefficiency and incompetence on the part of
6TC. +esides the proposed schemes even do not contemplate continuation
of PetitionersB Te,tile 4nderta5ing but only to merge !ith other
underta5ing and li"uidate the assets of the PetitionersB te,tile underta5ing.
Thus the purported ac"uisition is not in public interest or public purpose
but on the contrary not to nationalise the Petitioners te,tile underta5ing
and to return it to the Petitioners is for public purpose and in the public
interest. The Petitioners therefore submit that the purported ac"uisition of
PetitionersB te,tile underta5ing under the impugned @rdinance does not
satisfy the t!in test of ac"uisition vi1C public purpose and only on
payment of an amount !hich is non2illusory and just e"uivalent to mar5et
value as compensation. The Petitioners submit that above principles still
continue to be the re"uirements of compulsory ac"uisition in e,ercise of
po!er of 7minent $omain despite deletion of Article %' :%<:f< and 3% by
the Constitution :Hourty Hourty < Amendment Act %'('. The Petitioners
submit that on this count the impugned @rdinance is liable to be declared
as unconditional and ultra2vires.

%(. The Petitioners further submit that under -ection ':2< of the impugned
@rdinance provision has been made for simple interest at & per cent !hich
is clearly unconscionable. The Petitioners submit that the interest rate
generally prevailing is in the range of %) to 2% per cent. In this
bac5ground the provision for interest at &P is clearly illusory and
arbitrary.

%). The Petitioners further submit that under -ection >:3<:c< the ;espondents
are absolved from criminal liability for the post ta5eover period. The
Petitioners are point out this provision only to demonstrate ho! arbitrary
unreasonable and unconstitutional the impugned @rdinance is.

%'. The Petitioners further submit that by virtue of %')3 Act the management
!as sought to be ta5enover of the te,tile underta5ing and not the
PetitionersB company as such. In fact the said %')3 Act had itself
distinguished bet!een a te,tile company and te,tile underta5ings. The
Petitioners submit that they have various separate assets and underta5ings
!hich are not part of the te,tile underta5ing vi1C i< 8eather Clothes
$ivision ii< Halguni $ivision engaged in bloc5 printing manually of fancy
sarees -al!ars and Gamee1 !hich are purchased from open mar5et as
Hashion Habric $ivision iii< /ead @ffice iv< 8anddeal !ith an independent
third party v< retail shop building vi< cars and vii< land and buildings
:Aoon Aills premises<.

2*. The Petitioners submit that brief particulars of the three of the above
separate divisions.assets of the PetitionersB Company are summarised in
statement and are anne,ed hereto as Anne,ure $$. The Petitioners submit
that !ithout prejudice to the contention that the %')3 Act itself is invalid
and ultra vires and the present impugned @rdinance is also ultra vires in
any vie! of the matter the registered office.administrative office of the
Petitioners Company and aforesaid t!o divisions vi1C 8eather Cloth
$ivision and Halguni $ivision :Hashion Habric $ivision< are separate
establishments and are not part of the te,tile underta5ing !hich has been
so held by the $ivision +ench of the +ombay /igh Court and thus in any
vie! of the matter neither the management of them can be ta5enover nor
the same could be nationalised.

2%. The Petitioners submit that under -ection 2' of the @rdinance it has
provided that the provisions of the @rdinance shall have effect
not!ithstanding anything inconsistent there!ith contained in any other la!
or the judgment order or decree of any Court. The Petitioners submit that
in the event of it being contended that the orders passed by this /onBble
Court indicated earlier in an appeal from judgment and order of the
+ombay /igh Court from Writ Petition 6o. 2&*% of %')3 stands superseded
by virtue of -ection 2'. It is clearly impermissible and amounts to
contempt of this /onBble Court. It has been no! !ell established that a
legislation overriding the judgment and decree of a court is permissible
only if such a ne! legislation cures the defects as pointed out in the
judgment but not other!ise. If such contention is raised it !ould mean
that the impugned @rdinance purports to declare a judgment in valid
!ithout remedying the defects pointed out in the judgment !hich is !holly
impermissible. In fact such a course of action is not possible as factually it
has been found that the premise for enacting the %')3 Act insofar as it
pertains to the PetitionersB unit? i.e. mismanagement positively it can be
established that the impugned @rdinance is not the one for giving effect for
the principles given in clause :b< and :c< of Article 3' of the Constitution.
The Petitioners submit that on this count also the impugned @rdinance is
liable to be declared as unconstitutional under Articles %& and %' :%< :g< of
the Constitution.

22. The Petitioners therefore submit that the impugned @rdinance is
unconstitutional and is not saved as a reasonable restriction under Clause
0 of Article %' of the Constitution of India. The Petitioners therefore submit
that impugned @rdinance is therefore liable to be declared as ultravires
unconstitutional and violative of Articles %& %' 3%A %23 and 3**A of the
Constitution of India.

2. In the premises aforesaid the Petitioners most respectfully submit that this
/onBble Court be pleased to declare that Te,tile 4nderta5ings :6ationalisation<
@rdinance %''> :6o. 0 of %''>< dated 2(th 3une %''> is unconstitutional null
and void and ultravires Articles %& %' :%< :g< %23 and 3**A of the Constitution
of India.

3. The Petitioners further submit that this /onBble Court be pleased to issue a !rit of
mandamus or a !rit in the nature of mandamus or any other appropriate !rit
order or direction under Article 32 of the Constitution of India M
i. restraining the ;espondents from acting upon in furtherance or
implementation or in pursuance to the Te,tile 4nderta5ings
:6ationalisation< @rdinance %''>?
ii. for bearing and restraining the ;espondents from ta5ing any steps
including the disposal of the assets of the PetitionersB te,tile underta5ing or
any other steps !hatsoever pursuant thereto?
iii. directing the ;espondents to forth!ith handover bac5 possession of the
te,tile underta5ing of the Petitioners !ithout responsibility of the liabilities
of the underta5ing created in post management ta5eover period? i.e. %)th
@ctober %')3 till date of such handing over.

2. The Petitioners further submit that it is absolutely just essential necessary and in
the interest of justice that pending the hearing and final disposal of this petition
this /onBble Court be pleased to stay the operation implementation and e,ecution
of the impugned Te,tile 4nderta5ings :6ationalisation< @rdinance %''> :6o. 0 of
%''>< in any manner !hatsoever.

3. The Petitioners further submit that if it is contended by the ;espondents that by
virtue of -ection 2' of the @rdinance the interim orders passed by this /onBble
Court are no more valid and effective then pending the hearing and final disposal
of this petition this /onBble Court be pleased M
i. to restrain the ;espondents from disposing of parting !ith possession or
encumbering any other immovable properties fi,ed assets plant
machinery and fi,tures of the PetitionersB te,tile underta5ing?
ii. to restrain the ;espondents from removing any plant machinery furniture
and fi,tures from the premises of the PetitionersB te,tile underta5ing?
iii. to restrain the ;espondents from in any manner interfering !ith the
possession of the office premises of the Petitioner Company at their
registered office !ithout any interference or obstruction of any nature
!hatsoever?
iv. to direct the ;espondents to file the monthly statement of profit and loss
stoc5s production and employment in respect of use by the ;espondents of
the PetitionersB te,tile underta5ing as directed under order dated 22nd
3anuary %')> and submit to the Petitioners the inventory of all assets as
on %)th @ctober %')3.

&. The Petitioners submit that it is also absolutely just essential necessary and in
the interest of justice that pending the hearing and final disposal of this petition
this /onBble Court be pleased to direct that the interim orders passed by this
Court on %(th 3anuary %')> 22nd 3anuary %')> and 23rd 3anuary %')> on Civil
Appeal 6o. 2''> of %')& and other companion appeals and miscellaneous matters
therein are operative and binding on the ;espondents.

>. The Petitioners submit that they have demanded justice but the same has been
denied to them. The Petitioners in the circumstances have no alternative e"ually
efficacious remedy e,cept approaching this /onBble Court.

0. The Petitioners are challenging the said @rdinance on the ground of violation of
their fundamental right under Part III. The present !rit petition under Article 32
of the Constitution of India is therefore maintainable. +esides an appeal arising
from the previous %')3 Act !hich !as struc5 do!n by the +ombay /igh Court is
also pending before this /onBble Court !hich has been referred to the Constitution
+ench for hearing. The Petitioners submit that this /onBble Court therefore has
jurisdiction to entertain try and dispose of this petition in e,ercise of its ordinary
civil jurisdiction under Article 32 of the Constitution of India.

(. The Petitioners have not filed any other petition in relation to the subject matter
of the present petition either in this /onBble Court or in any /igh Court in the
country.

). The Petitioners have paid fi,ed court fee of ;s. 3**.2 on this petition.

'. The Petitioners !ill rely upon the documents a list !hereof is hereto anne,ed.
The Petitioners Therefore pray C
a. :a< that this /onBble Court be pleased to declare that Te,tile 4nderta5ings
:6ationalisation< @rdinance %''> :6o. 0 of %''>< dated 2(th 3une %''> as
constitutional null and void and ultra vires Articles %& %' :%< :g< and 3**
A of the Constitution of India.
b. :b< that this /onBble Court be pleased to issue a !rit of mandamus or a
!rit in the nature of mandamus or any other appropriate !rit order or
direction under Article 32 of the Constitution of India M
i. :i< restraining the ;espondents from acting upon in furtherance or
implementation or in pursuance to the Te,tile 4nderta5ings
:6ationalisation< @rdinance %''>?
ii. :ii< forbearing and restraining the ;espondents from ta5ing any
steps including the disposal of the assets of the PetitionersB te,tile
underta5ing or any other steps !hatsoever pursuant thereto?
iii. :iii< directing the ;espondents to forth!ith handover bac5
possession of the te,tile underta5ing of the Petitioners !ithout
responsibility of the liabilities of the underta5ing created in post
management ta5eover period? i.e. %)th @ctober %')3 till date of
such handing over?

b. that pending the hearing and final disposal of this petition this /onBble
Court be pleased to stay the operation implementation and e,ecution of
the impugned Te,tile 4nderta5ings :6ationalisation< @rdinance %''> :6o.
0 of %''>< in any manner !hatsoever?
c. pending the hearing and final disposal of this petition this /onBble Court be
pleasedM
i. to restrain the ;espondents from disposing of parting !ith
possession or encumbering any other immovable properties fi,ed
assets plant machinery and fi,tures of the PetitionersB te,tile
underta5ing?
ii. to restrain the ;espondents from removing any plant machinery
furniture and fi,tures from the premises of the PetitionersB te,tile
underta5ing?
iii. to restrain the ;espondents from in any manner interfering !ith the
possession of the office premises of the Petitioner Company at their
registered office !ithout any interference or obstruction of any
nature !hatsoever?
iv. to direct the ;espondents to file the monthly statement of profit
and loss stoc5s production and employment in respect of use by
the ;espondents of the PetitionersB te,tile underta5ing as directed
under order dated 22nd 3anuary %')>?
d. that pending the hearing and final disposal of this petition this /onBble
Court be pleased to direct that the interim orders passed by this court on
%(th 3anuary %'> 22nd 3anuary %')> and 23rd 3anuary %')> on Civil
Appeal 6o. 2''> of %')& and other companion appeals and miscellaneous
matters therein are operative and binding on the ;espondents?
e. ad2interim reliefs in terms of prayers :c< :d< and :e<?
f. for costs of this petition?
g. for such other and further reliefs as the nature and circumstances of the
case may re"uire and this /onBble Court may deem fit and proper to grant.