NISHANT INDUSTRIES Vs. STATE OF U P

JUDGEMENT

(1.) The case of the petitioners in Civil Misc. Writ Petition No. 38984 of 2011 (in short called as the ''first writ petition') is that they are small scale industrial units registered with the Director of Industries, Uttar Pradesh, Kanpur. The Coal India Limited and its subsidiary companies enjoy the monopoly of production, distribution and sale of coal under the provisions of the nationalization Act. The Supreme Court in [Ashoka Smokeless Coal India (P) Ltd. and others Vs. Union of India and others, 2007 2 SCC 640 ] held that all the small scale industrial units would get the supply of coal on notified prices from the subsidiary companies of Coal India Limited on the basis of the erstwhile linkage and a policy would be notified in this regard pertaining to distribution of coal by the Central Government. Thereafter the Government of India, Ministry of Coal issued a new coal distribution policy dated 18th October, 2007. Since the petitioners were linked units and were holding their erstwhile linkage for supply of coal from South Eastern Coalfields Limited (hereinafter in short called as ''SECL'), they were allowed to execute Coal Supply Agreement with SECL and the same was executed on 30th April, 2008 as per the policy. After execution of such agreement, supply of coal as per MPQ quantity was resumed to the petitioners regularly every month and it continued upto January, 2011, for which the petitioners submitted end-use details of coal in Format-I and II, as prescribed by SECL. On 27th January, 2011 a circular was issued by the Chief General Manager (S&M), SECL and thereby in terms of Clause 4.4 of the Coal Supply Agreement required the petitioners to furnish the desired information, along with supporting documents (photocopies duly authenticated, signed and sealed by the officials of District/ State Industries Department) in the prescribed Format- I and II along with a certificate from the official of the District/ State Government, certifying therein the working status of the unit. It was further provided therein that said information is to be submitted for release of coal every month under an affidavit duly notarized by notary public as per the proforma circulated earlier. For necessary action, such circular was also sent to the Director of Industries, Uttar Pradesh, Kanpur, who sent a reply dated 30th March, 2011 to the Principal Secretary, Small Scale Industrial Units, Government of Uttar Pradesh, Lucknow stating its inability to authenticate, sign and seal the end-use documents of units getting more than 4200 MT Coal. A copy of such reply was also sent to the Chief General Manager (S&M), SECL for information and necessary action. However, by virtue of circular dated 27th January, 2011 the authorities of SECL have stopped the supply of coal to the petitioners with effect from February, 2011 on the ground that the end-use submitted by the petitioners for the month of January, 2011 has not been duly authenticated, signed and sealed by the officials of the District/ State Industries Department. Against such action of the respondent authorities, the petitioners submitted objection dated 08th June, 2011 along with complete data sheet of all the months and stated that end-use has already been submitted, but the same has not been authenticated and verified by the concerned authorities. Petitioners have already submitted the payment for the month of February, 2011 for supply of coal, but the same was refused and not accepted by the authorities of SECL due to non-authentication of the end-use documents, whereas due to non-supply of coal the petitioners are facing great hardship. In such circumstances, the first writ petition has been filed.

(2.) At the threshold, by an order dated 18th July, 2011 this Court was pleased to protect the interest of the petitioners in the first writ petition to the extent that SECL should accept the draft prepared by the petitioners to lift the coal since in the month of July, 2011 the quota of lifting coal will expire. Such order was passed strictly without prejudice to the rights and contentions of the parties. But we find that since the authority of SECL refused to accept the draft, the Court was pleased to direct the counsel for the respondents to accept the bank draft, which was accordingly done under the order dated 10th August, 2011. However, at this final stage, we are only concerned about the applicability of new coal distribution policy and effective implementation of the Coal Supply Agreement/s.

(3.) So far as Civil Misc. Writ Petition No. 43736 of 2011 (in short called as the ''second writ petition') is concerned, the only difference is that in this matter Forms- I and II have been supplied to such petitioner till March, 2011 and thereafter verification has been stopped.