VIDARBHA MILLS BERAR LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) In this case the petitioners have challenged the acquisition of the textile mill of the petitioner-company under the Sick Textile Undertakings (Nationalisation) Act, 1974, hereinafter referred to as the Nationalisation Act.

(2.) It appears that the mill of the petitioner - company suffered a heavy loss in the year 1965-66 as a result of which the running of the mill had to be stopped with effect from June 10, 1966. While the mill remained closed, by virtue of an agreement between the petitioner-company on the one hand and the State of Maharashtra on the other, a lease of the textile mill was granted by the petitioner-company to the State of Maharashtra at an annual rent of Rs. 7 lakhs for a period of seven years with effect from July 1, 1966.

(3.) After the promulgation of the sick Textile Undertakings (Taking Over of Management) Ordinance, 1972, hereinafter referred to as the Take-Over Ordinance, on October 31, 1972, the management of the textile undertaking of the petitioner-company was taken over by the State Government as a sick textile undertaking. The Take-Over Ordinance was replaced by the Sick Textile Undertakings (Taking Over of Management) Act, 1972, hereinafter referred to as the Take Over Act. On September 21, 1974, the sick textile undertakings vested in the Government under the Nationalisation Act.