ORIENT PAPER AND INDUSTRIES LIMITED STRAW PRODUCTS LIMITED ORIENT PAPER AND INDUSTRIES LIMITED STRAW PRODUCTS LIMITED Vs. STATE OF ORISSA

JUDGEMENT

(1.) These appeals by special leave arise from the judgments of the Orissa High Court in 0.J.C. No. 3235 of 1988 and 0.J.C. No. 3100 of 1988. The High Court dismissed the appellants'writ petitions praying for a declaration that the Orissa Forest Produce (Control of Trade) Act, 1981 ('Act 22 of 1981') and the Notification No. 6F-10/ 88/ 21691 / FFAH dated September 21, 1988 issued under S. 1(3) of the said Act have no application to the contracts entered into between the appellants and the State of Orissa and for a direction to prohibit the respondent State from enforcing the provisions of the said Act in pursuance of the said notification in respect of the said contracts and to allow the appellants to cut and remove bamboos from the areas covered by the contracts. One of the appellants in C.A. No. 4347 of 1988, namely, Straw Products Ltd. filed Writ Petition No. 474 of 1989 under Art. 32 of the Constitution for a declaration that Ordinance No. 1 of 1989, the Orissa Forest Produce (Control of Trade) (Amendment) Act. 1989 ('Act 4 of 1989), Notification No. 6F-10/ 88/ 21691 / FFAH dated 21-9-88 (S. R.O. No. 666 of 1988) and Notification No.6F-10/88/ 21693/FFAH dated 21-9-1988 (S.R.O. No. 667 of 1988) are null and void and for certain other reliefs. The appellants, in C.A. No. 4346 of 1988, namely, Orient Paper and Industries Ltd., and another filed Writ Petition No. 1132 of 1988 (as amended in 1989) under Art. 32 of the Constitution praying for a declaration that the Orissa Forest Produce (Control of Trade) (Amendment and Validation) Act, 1987 ('Act 16 of 1987) and Orissa Forest Produce (Control of Trade) (Second Amendment) Act, 1987 ('Act 15 of 1987); Ordinance No. 1 of 1989 and the Act which replaced it (Act 4 of 1989); Notification No.6F-10/88/21691/FFAH dated September 21, 1988 (S.R.O. No. 666 of 1988; and Notification No. 6F-10/88/21693/FFAH dated September 21, 1988 (S.R.O. No . 667 of 1988) are null and void, and for certain other reliefs. The parties in these appeals and writ petitions shall hereinafter be conveniently referred to as 'the contractors'.

(2.) The contractors had entered into agreements with the State of Orissa in terms of which they had obtained exclusive rights and licences to fell, cut and remove bamboos from certain specified areas for the purpose of converting them into pulp. The agreements would have expired on September.on 1989. These agreements are generally referred to as the "bamboo contracts". These contracts were rescinded by Act 22, of 198 1, which, in respect of bamboos, as we shall presently see, came into force as from 1-10-1988. The contractors contend that their rights in respect of bamboos are not annulled or affected by reason Cf Act 22 of 1981. Their rights, they say, are in the nature of profits a prendre, and are not susceptible of repudiation by statutory rescission of contracts. They rely upon a decision of this Court in State of Orissa v. Titaghur Paper Mills Co. Ltd. [(1985) 3 SCR 26): (A.I.R 1985 SC 1293).

(3.) The bamboo contract was considered by this Court in 'Titaghur (supra) with reference to the question whether the amount payable under the contract was exigible to purchase tax under the Orissa Sales Tax Act, 1947 (as amended in 1977). This Court held: