KRISHNA CHEMICALS Vs. STATE OF GUJARAT

JUDGEMENT

(1.) This is an appeal by the petitioners in the Special Civil Application against the judgment of the learned single Judge dismissing the application. The 1st appellant is a partnership firm of which the 2nd appellant is a partner. The firm is engaged in the business of manufacturing chemicals out of bark of different varieties of forest trees. Though they are so manufacturing various forest based chemicals they are not manufacturers of Katha which is said to be manufactured by use of Khairwood. They being manufacturers in the line they desire to diversify by commencing manufacture of Katha also. Though their unit is registered with the District Industries Centre as a unit for nepthalene intermediary and dyes intermediary and not for Katha they could at any time seek to manufacture Katha on their own as such registration is necessary only for the purpose of obtaining certain benefits. They did make an application to include manufacture of Katha also in the products turned out by them but their application was filed by the District Industries Centre for failure to furnish certain particulars. Respondents 3 4 and 5 are manufacturing only Katha out of Khairwood and the 6th respondent is also Such a manufacturer but operating in a different area. It is necessary that there should be regular supply of Khairwood for manufacture of Katha and that is available only from the forest area. Besides the forests in Gujarat these may be available in certain quantities from forests in Maharashtra also if there is any left available for supply after local use. The petitioners complain that they have been discriminated against in the matter of supply of such Khairwood to them for the proposed manufacture of Katha on the ground that the supply of Khairwood now available in the forests in Gujarat would not be sufficient for feeding the industries set up by respondents 3 to 6. According to them they offered a very high price of Rs. 4 0 per cubic metre of Khairwood that may be supplied to them and that the price at which it is sold to respondents 3 to 6 is in the region of Rs. 1 0 per cubic metre if not less. According to them therefore the State stands to lose heavily by supply to respondents 3 to 6 when the petitioners have offered to pay a higher price for the same goods and it will also be a violation of the right of the petitioners to run their industry if supply of such wood from the forests of Gujarat is denied to the 1st petitioner firm.

(2.) The case of respondents 3 to 5 is that they are running industries in the tribal belts of the southern districts of Gujarat and that this provides employment to the tribals that they have established the industries concerned many years ago that khairwood is a raw material which is absolutely necessary for running their industries that even as it is regular supply to the extent required for full utilisation of their capacity is not being obtained by them from the Forest Department and therefore there is no case for sharing it with any newcomer. In other words what is pointed out is that if any new industry is to share the Khairwood with them that would affect the running of that industry resulting not only in loss to them but also in unemployment to persons employed in factories run by respondents 3 to 5 and that the tribals. It is therefore contended that the stand taken by respondents 1 and 2 of supplying whatever is available to respondents 3 to 5 is unobjectionable. The 6th respondent on the other hand has a case based upon a contract entered into with the Government in the year 1981 under which the Government has assured him supply of Khairwood available from Sabarkantha and Banaskantha districts of the State and such supply itself would not he sufficient to satisfy the quantity agreed upon as liable to be provided to the 6th respondent. Respondents 1 and 2 the State of Gujarat as well as the Chief Conservator of Forests Gujarat State take the stand that with the available resources it may not be possible to provide a fresh industry with Khairwood and if such provision is made it will destroy the existing industries resulting in the further consequence of unemployment in tribal belts where employment is very scarce. The learned single Judge has evidently accepted these contentions and has found no case for the petitioners.

(3.) The main argument of the learned counsel for the petitioners is that it will he discriminatory to say that persons like the petitioners who want to embark upon an industry of manufacture of Katha will not have a treatment similar to that enjoyed by respondents 3 to 5. It is their case that Khairwood being available not very easily there should be no question of patronising one nr two industries in the State denying for that reason opportunity to other industries to start the same business. Besides violating the rule of equal opportunity to run the business assured under Article 14 of the Constitution it would according to the counsel be also violation of Article 19(1)(g) of the Constitution India There is a further case for the appellants that there has been considerable price preference to respondents 3 to 6 in that supply is made to them at a price far below the market price of these goods. That will amount to favouritism on the part of the Government and naturally that should not be encouraged.