GUJARAT ELECTRICITY BOARD Vs. SHANTILAL R DESAI

JUDGEMENT

(1.) The only question that falls for decision in this appeal is whether on the basis of the notice issued by the Bombay State Electricity Board on January 8, 1959 under S. 7 of the Indian Electricity Act, 1910 (to be hereinafter referred to as the Act) prior to its amendment in 1959, the appellant can compulsorily purchase from the respondent his concern " The Bilimora Electric Power Supply Co.' In his application before the High Court under Art. 226 of the Constitution the respondent challenged the vires of S. 7 of the Act. But that contention remains to be examined. The High Court has chosen to allow the petition solely on the ground that as the requirements of S. 7 have not been complied with, the appellant cannot compel the respondent to sell the undertaking. If we come to the conclusion that that conclusion is unsustainable then the matter will have to go back to the High Court for deciding the constitutionality of S. 7.

(2.) The respondent was given a licence on February 11, 1932, under the provisions of the Baroda Electricity Act Samvat 1983 for supplying electricity within the area mentioned in the licence. Clause 27 of that licence provided that the option of purchase given by S. 9 of the Baroda Electricity Act shall be exercisable first on the expiration of thirty years computed from the commencement of the licence and thereafter on the expiration of every subsequent period of ten years during the subsistence of the licence. The manner in which the undertaking should be valued is laid down in that Act. On the merger of the former Baroda State with the Province of Bombay, the Act as well as the Electricity (Supply) Act, 1948 (Act 54 of 1948) were made applicable to the territories of the former State of Baroda, and the corresponding Baroda Acts were repealed with the saving clause that the licences issued under the repealed Act shall continue to remain in force as if issued under the Act, until the expiration of the period of those licences. In exercise of the powers conferred by S. 5 of the Electricity Supply Act 1948 the Government of Bombay constituted the Bombay State Electricity Board on January 31, 1945. On January 8, 1959 that Board issued to the respondent a notice under S. 7 of the Act. That notice is important for our present purpose. Hence we shall quote the relevant portion thereof. It runs thus:

(3.) As a result of the Bombay Reorganization Act, 1960, the present Gujarat State came into existence. In exercise of the powers conferred by S. 5 of the Electricity (Supply) Act, 1948 read with sub-s. (4) of S. 68 of the Bombay Reorganization Act, 1960 the appellant Corporation was constituted by the Government of Gujarat by means of a notification dated May 1, 1960. The Central Government by the notification No. EL-II-1(22)/60 dated the 17th June, 1960 made in exercise of the powers conferred by Cl. (a) of sub-s. (4) of S. 68 of the Bombay Reorganization Act, 1960 directed that the appellant Corporation shall "with effect from 1st May 1960" take over from the Bombay State Electricity Board all its undertakings, assets, rights and liabilities in the area comprised in the State of Gujarat. The said notification was amended in some respect by notification of the Government of India dated October 3, 1960 providing therein that the amendment thereby made in the notification dated June 17, 1960 shall be deemed always to have been made. On the basis of the aforementioned notifications, the appellant is claiming the right to compulsorily purchase the undertaking.