MAHENDRA SHANTILAL SHAH Vs. UNION OF INDIA

JUDGEMENT

(1.) To stay or not to stay is the question Granting stay will mean:

(2.) We therefore consider it necessary and desirable to articulate at length the reasons for our decision to refuse interim stay of the operation of the order giving rise to the Letters Patent Appeal even though we have admitted the same inasmuch as it raises arguable issues) and fixed it for hearing in August 1982.

(3.) The facts have been dealt with at length in the judgment under appeal rendered by our learned Brother Ahmadi J. in Company Application No. 130 of 1981 in Company Petition No. 75 of 1978. On the Judges Summons taken out by Union of India for permission to appoint any person or body of persons to take over management of The New Jehangir Vakil Mills Company Limited (in liquidation) under sec. 18-FA of the Industries (Development and Regulation) Act 1951 (the Act) the learned Company Judge passed an order making the Summons absolute in terms of Prayers (a) and (b) with the modification that the authorised person will be Gujarat State Textile Corporation. Union of India was permitted to appoint the said Corporation as authorised person to take over management of the aforesaid Company which was under liquidation as per the order passed on 9/07/1981 the reasons in respect of which were set out in the speaking order dated 13/10/1981 The aforesaid Company has been ordered to be wound up by an order passed by the learned Company Judge on 4/02/1981 Some five months thereafter the Summons praying for permission to take over the management of the Company in exercise of the power under sec. 18FA(1) was taken out on 9/07/1981 We are told that the Company which was engaged in the manufacture of cotton textiles was closed down on 11/07/1980 Since that date about four thousand workman employed by the Company (about 2500 permanent workmen and about 1500 Badli workmen) have become unemployed and are starving as they are not in a position to obtain alternative employment in Bhavnagar where there are no opportunities for securing employment in any other textile unit. Under sec. 18-FA contained in Chapter III-AA of the Act relating to Management or Control of Industrial undertakings owned by companies in liquidation the Central Government has the power to authorise with the permission of the High Court the taking over of management or control of industrial undertakings. The relevant provisions require to be quoted: