The Tufanialonga Tea Co. Ltd., Calcutta and anr. Vs. State of Tripura and ors. - Court Judgment

Excerpt:
- - 1. in this application under article 226 of the constitution of india, the petitioners have prayed for declaring the tripura tea companies (taking over of certain tea units) ordinance 1986 and the tripura tea companies (taking over of management of certain tea units) act, 1987, as ultra vires the constitution and for quashing the notification and orders issued thereunder as well as the certificate proceedings leading to the sale of the tea estates belonging to the petitioners in course qf the said certificate proceedings and for a direction on the respondents to pay proper compensation with interest at 18% per annum for the damages suffered by the petitioners on account of the take over of the lea estates of the petitioners. these provisions in sections 16 a to 16 n in chapter iii a of the tea act, 1953, are therefore provisions made by the parliament in exercise of its powers under entry 52 of list i as well -as its powers under entry 33 of list iii of the 7th schedule of the constitution which confer concurrent power in parliament and the legislature of a state to make law relating to production; -(1) the state government may, if satisfied, in relation to any tea unit or any part thereof, the management of which has vested in it by the act that it is necessary so to do in the interest of the general public, with a view to preventing any fall in the volume of production of tea by such tea units, by notification declare that the operation of all or any of the contracts, assurances of property, agreements, settlements, awards, standing order or other instruments in force (to which such tea units or the tea company owning such tea unit is a party or which may be applicable to such tea unit) immediately before the date of issue of the notification shall remain suspended or that all or any of the rights, privileges, obligations and liabilities accruing or arising there under before the said date, shall remain suspended or shall be enforceable with such adaptation and in such manner as may be specified in the notification. sections 7 to 15 contain somemiscellaneous provisions such as the overridingeffect of the impugned act (section 7), the application of companies act, 1956, (section 8),exclusion of period of operation of the impugnedact from limitations (section 9), protection of anaction taken on good faith (section 10), power toterminate contract of employers (section 11),penalties (section 12), offence by companies(section 13), power to make rules (section 14)and repeal and savings (section 15). it is thusclear that the impugned act has been made forthe purpose of augmenting production of tea bythe tea units by vesting the management of the teaunits in the state government for a period of fiveto seven years and by empowering the stategovernment to suspend contracts, assurances ofproperties, agreements, settlements, awards,standing orders or other instruments with a viewto prevent any fall in the volume of tea by the teaunits. this is well established by a catena of decisions (see union bt india v. but the district collector refused to set aside the sale on the ground that the application for setting aside the sale ,was filed well beyond the period of limitation. prasad singh, air 1995 sc 1971, in which the supreme court held that the court would not remain mute spectator to obvious manifest illegality committed in conducting the court sales even if application for setting aside of the 'safe was not filed in time. (3) the order shall take effect as against transferees for value in good faith from the date when a copy of the order is affixed on the property and against all other transferees from the date on which such order is made. ;(3) the proclamation of the intended sale shall state the date time and place of the same and specify the following as clearly and accurately as possible- i) the property to be sold; annexure-r series show that on 30-4-1987 form 28 was issued in respect of laxmilonga tea estate fixing the date of auction to 2-6-1987 and on 6-5-1987 the peon shri mali chand debverma endorsed 'behind the said form 28 to the effect that he went to harendra nagar tea garden but the manager of the tea garden refused to take notice and put his signature and that he hung the notice on a tree nearby. patnaik, j. 1. in this application under article 226 of the constitution of india, the petitioners have prayed for declaring the tripura tea companies (taking over of certain tea units) ordinance 1986 and the tripura tea companies (taking over of management of certain tea units) act, 1987, as ultra vires the constitution and for quashing the notification and orders issued thereunder as well as the certificate proceedings leading to the sale of the tea estates belonging to the petitioners in course qf the said certificate proceedings and for a direction on the respondents to pay proper compensation with interest at 18% per annum for the damages suffered by the petitioners on account of the take over of the lea estates of the petitioners.2. the relevant facts briefly are that the petitioner no. 1 is a limited company registered under the indian companies act, 1913 and was the owner of the tufanialonga tea easte located at tebaria. the petitioner no. 2 is also a limited company registered under the indian companies act, 1913 and was the owner of the laxmilonga tea estate located at tebaria, tripura west. the petitioner no. 3 is a director of the petitioner nos. 1 and 2 companies. the petitioner's have been carrying on the business of producing and manufacturing of tea in the said tea estates since 1918-19. on 13-11-86, the tripura tea companies (taking over of management of certain tea units) ordinance, 1986, was promulgated by the governor of tripura. by the said ordinance, with effect from the date of promulgation of the ordinance, the management of the tea companies in relation to tea units mentioned in the schedule to the ordinance vested in the state of tripura for a period of 5 years. the tufanialonga and the laxmilonga tea estates were included in the said schedule to the ordinance. in exercise of powers conferred by sub-section (1) of section 4 of the said ordinance, the state government appointed the tripura tea estates development corporation limited as the custodian of the aforesaid two tea estates. the managing director of the tripura tea estates development corporation limited sent notices dated 13-11-86 to the petitioner nos. 1 and 2 to furnish to him the inventories and agreements in relation to the two tea units and to deliver to him all books, papers and other documents relating to the two tea units. on 13-11-86, the managing director of tripura tea estates development corporation limited also issued notifications appointing shri dilip kumar das, labour inspector, government of tripura as the custodian of the tufanialonga tea estate and shri ratan chakravorty, labour inspector, government of tripura, as custodian of the laxmilonga tea estate. by the two notifications dated 13-11-86, shri dilip kumar das and shri ratan chakravorty were authorised to take over charge of the management of the respective tea units. two notices dated 13-11-86 were also issued by the managing director of tripura tea estate development corporation limited to the petitioner nos. 1 and 2 to deliver to the said shri dilip kumar das and shri ratan chakravorty all the properties in possession, custody and control of the petitioner nos. 1 and 2. the ordinance was substituted by the tripura tea companies (taking over of management of certain tea units) act, 1986, which received assent of the president of india on 29-1-87. after the expiry of the period of 5 years, the period for management of the undertakings of the tea companies in relation tothe tea units by the state government was extended for one year with effect from 11 -11-91 by notification dated 9-4-91 of the state government. thereafter, the said period was again extended by notification dated 14-10-92 of the state government for one year with effect from 11-11-92. jn the meanwhile, certificate proceedings were initiated against the petitioners nos. 1 and 2 for non-payment of land revenue amounting to rs. 4147.34 and rs. 6639.92 respectively and the tea estates of the petitioners nos. 1 and 2 were sold in auction on 4-6-87 at a token price of re. 1/- for each tea estate in course of the said certificate proceedings and the said sales were confirmed on 27-7-87. the petitioners have challenged the said ordinance and the act and the said sales of their tea estates in the certificate proceedings in the present writ petition.3. mr. g.c. chakravorty, learned counsel appearing for the petitioners, submitted that the impugned ordinance and the impugned act are beyond the legislative competence of the governor and the state legislature of tripura and are, therefore, unconstitutional and void. he contended that under article 246(1) of the constitution, parliament has exclusive powers to make law with respect to any of the matters enumerated in list i of the 7th schedule of the constitution and entry 52 of the said list i related to 'industries the control of which by the union is declared by parliament by law to be expedient in the public interest'. in exercise of its powers under article 246(1) of the constitution read with entry 52 of the list i of the 7th schedule of the constitution. parliament has declared in section 2 of the tea act, 1953 that it is expedient in the public interest that the union should take under ' its control the tea industry and has made elaborate provisions relating to the tea industry in the said act. mr. chakravorty referred to the provisions of chapter iii a of the tea act, 1953 to show that elaborate provisions have been made therein for management and control of tea undertakings or tea units by the central government in certain circumstances. he submitted that it will be clear from the express language used in entry 24 of list ii of the 7th schedule read with article 246 (2) of the constitution that the power of the state legislature to make law relating to industry is subject to the provisions of entry 52 of the list i of the 7th schedule of the constitution. he explained that as parliament has made the tea act, 1953, under entry 52 of list i of the 7th schedule of the constitution which includes, inter alia, provisions with regard to take over of the management and control of tea undertakings or tea units by the central government in certain circumstances, the state legislature cannot make any law on the very same subject. the impugned act was, therefore, beyond the competence of the state legislature. mr. chakravorty submitted that since the power of the governor to make an ordinance under article 213 of the constitution is co-extensive with the power of the state legislature to make law, the impugned ordinance was also beyond the competence of the governor. mr. chakravorty pointed out that the impugned act received the assent of the president but such assent cannot validate an act made by the legislature of state on a matter covered under the entries in list i of the 7th schedule of the constitution. the assent of the president may be of relevance only if the act has been made by the state legislature on a matter enumerated in list iii (concurrent list) as would be clear from article 254 (2) of the constitution. alternatively, mr. chakravorty submitted that the impugned ordinance and the impugned act are hit by the provisions of sections 16a to 16n of chapter iii a of the tea act, 1953, inasmuch as, the impugned ordinance and'the act make provisions for take over of the management of the tea companies by the state government, although elaborate provisions have been made in the said sections 16a to 16n of chapter iiia of the tea act, 1953 for the control of the tea estates and tea units including the take over of the management of the tea estates and tea units in certain circumstances by the central government. in support of these submissions, mr. chakravorty cited the decisions of the supreme court in hingir-rampur coal co. v. state of orissa, air 1961 sc 459, state of orissa v. m.a. tullock & co., air 1964 sc 1284 and ltc ltd. v. state of karnataka, 1985 (supp) scc 476.4. mr. b. r. bhattacharjee, learned advocate general, tripura, on the other hand, submitted that under entry 24 of the list ii of the 7th schedule of the constitution, the state legislature has the power to make law relating to industry and in ishwari khetan sugar mills v. state of u. p., air 1980 sc 1955, the supreme court held that when parliament by law declares that the control of a particular industry by the union is expedient in the public interest, the power of the state legislature to make law relating to such industry still remains and is only taken away to the extent parliament makes provisions in the law enacted by it. according to mr. bhattacharjee, therefore, even though parliament has made the tea act, 1953, the state legislature still can make law relating to tea industry in exercise of its powers under article 246 (2) read with entry 24 of the 7th schedule of the constitution, the only limitation to its power being that it cannot enact a provision which is in direct conflict with the provisions of the tea act, 1953. mr. bhattacharjee argued that in sections 16 a to 16 n in chapter iii a of the tea act, 1953, there is no provision prohibiting the take over of the management of tea units by the state government and, therefore, the impugned ordinance and the impugned act providing fof take over of the management of certain tea units by the state government do not in any manner conflict with the said provisions of the tea act, 1953 and are within the competence of the governor and the state legislature. he further pointed out that a reading of the statement of objects and reasons of the tea act, 1953 would show that the object of the tea act, 1953 is to control the export of tea. the object of the impugned ordinance and impugned act, on the other hand, is to augment the production of tea or to prevent the fall in the production of tea in the state. the objects of the tea act, 1953 and the impugned ordinance and the impugned act are different and it cannot be held that they cover the same field. alternatively, mr. bhattacherjee contended that under entry 33 of the list iii (concurrent list) of the 7th schedule read with article 246 (2) of the constitution, the state legislature has concurrent power with parliament to make law relating to production of the product of any industry where the control of such industry by the union has been declared by the parliament by law to be expedient in the public interest. according to mr. bhattacharjee, since the object of the impugned ordinance and the impugned act is to augment the production of tea or to prevent the volume of production in the state they are covered under the said entry 33 of the list iii of the 7th schedule of the constitution and are within the powers of the state legisla ture. in reply to the submission of mr. chakravorty that the impugned ordinance and the impugned act are hit by the provisions of sections 16a to 16n of the tea act, 1953, mr. bhattacharjee submitted that there is no such repugnancy between the state law and the central law and that both the state law and the central law can operate together and cited the decision of the supreme court in bihar distillery v. union of india, air 1997 sc 1208 to show how the state and the union both have their respective control over the same subject matter within their demarcated areas. alternatively, he submitted that once the impugned act received the assent of the president, it prevailed over the provisions of sections 16 a to 16 n of the tea act, 1953, as has been provided in article 254(2) of the constitution and for this submission relied on the decision of the supreme court in thirumuruga kirupananda variyar thavathiru sundara swamigal medical education & charitable trust v. state of tamil nadu, (1996) 3 scc 15 ; (air 1996 sc 2384).5. article 246 and entry 52 of list i; entries 24 and 27 of the list ii and entry 33 of the list iii of the 7th schedule of the constitution are extracted hereinbelow. '246. subject-matter of laws made by parliament and by the legislature of states.--(1) notwithstanding anything in clauses (2) and (3), parliament has exclusive power to make laws with respect to any of the matters enumerated in list i in the seventh schedule (in this constitution referred to as the 'union list').(2) notwithstanding anything in clause (3), parliament, and, subject to clause (1) the legislature of any state also, have power to make laws with respect to any of the matters enumerated in list iii in the seventh schedule (in this constitution referred to as the 'concurrent list').(3) subject to clauses (1) and (2), the legislature of any state has exclusive power to make laws for such state or any part thereof with respect to any of the matters enumerated in list ii in the seventh schedule (in this constitution referred to as the 'state list').(4) parliament has power to make laws with respect to any matter for any part of the territory of india not included (in a state) notwithstanding that such matter is a matter enumerated in the state list.' 'seventh schedule . (article 246) list i - union list52. industries, the control of which by the union is declared by parliament by law to be expedient in the public interest.list ii -- state list24. industries subject to the provisions of (entries 7 and 52) of list i.27. production, supply and distribution of goods subject to the provisions of entry 33 of list iii. list iii -- concurrent list 33. trade and commerce in, and the production, supply and distribution of,-- (a) the products of any industry where the control of such industry by the union is declared by parliament by law to be expedient in the public interest, and imported goods of the same kind as much products;(b) foodstuffs, including edible oilseeds and oils;(c) cattle fodder, including oilcakes and other concentrates;(d) raw cotton, whether ginned or unginned, and cotton seed; and(e) raw jute.' under article 246(1) of the constitution quoted above, parliament has exclusive power to make law with respect to any of the matters enumerated in list i of the 7th schedule of the constitution. under entry 52 of the list i, therefore, the parliament has power to make law relating to industries the control of which by the union is declared by parliament by law to be expedient in the public interest. under article 246(3) of the constitution, the legislature of any state has exclusive powers to make laws for such state or any part thereof with respect to any of the matters enumerated in list ii in the 7th schedule of the constitution. in entry 24 of the list ii, the legislature of a state has power to make laws on industries subject to the provisions of entries 7 and 52 of the list 1 under entry 27 of list ii read with article 246(3) of the constitution, moreover, the legislature of a state has the power to make law relating to production, supply and distribution of goods subject to the provisions of entry 33 of list iii of the 7th schedule of the constitution. under article 246(2) of the constitution, both parliament and the legislature of a state have the power to make laws with respect to any of the matters enumerated in list iii of the 7th schedule of the constitution. under entry 33 of the list iii read with said article 246(2) of the constitution, therefore, both parliament and the legislature of state have powers to make law relating to trade, commerce, production, supply and distribution of products of any industry where the control of such industry by the union is declared by parliament by law to be expedient in the public interest. thus where as state legislature has exclusive powers under article 246(3) read with entry 27 of the list ii of the 7th schedule of the constitution to make law relating to production, supply and distribution of goods, both parliament and the legislature of a state have concurrent powers under entry 33 read with article 246(2) of the constitution to make law relating to the production, supply and distribution of the products of any industry where the control of such industry by the union is declared by parliament by law to be expedient in the public interest. it is pertinent to note that nonq of the entries in list i, list ii or list iii of the 7th schedule of the constitution mention take over of the management of an industry by the government as a separate subject of legislation. hence the power to legislate for taking over of the management of an industry has to be located in the aforesaid entry 52 of list i, entries 24 and 27 of list ii and entry 33 of list iii of the constitution.6. to find out the entries in lists i, ii and iii on which the tea act, 1953 and the impugned act and the impugned ordinance have been made, we may now examine the provisions of the tea act, 1953 and of the impugned ordinance and the impugned act. the long title of the tea act, 1953 states that it was an act to provide control by the union on the tea industry, including control, in pursuance of international agreement now in force, of the cultivation of tea in and of export of tea from india and for that purpose to establish a tea board and levy a duty of excise on tea produced in india. section 2 of the act declares that it is expedient in the public interest that the union should take under its control the tea industry. sections 4 to 11 in chapter ii of the act provide for constitution of the tea board, its function and its dissolution. sections 12 to 16 in chapter iii of the act relates to control over the extension of tea cultivation. sections 17 to 24 in chapter iv of the act contain different provisions relating to control over the tea and tea seed. sections 25 to 29 in chapter v of the act relate to finance, accounts and audit and provide for imposition of cess on tea, payment of proceeds of the cess to the board, constitution of tea fund, etc., chapter vi of the act contains various provisions relating to control by the central government of price and distribution of tea and tea waste (section 30), general control over acts and proceedings of the board (section 31) and appeal to central government against the orders of the board (section 32). chapter vii of the act contains various miscellaneous provisions in sections 33 to 51 and provides for licencing of brokers, tea manufacturers, inspection of tea estates or places where tea and tea waste are stored or exposed for sale, calling of returns relating to production, sale, export of tea produce at a tea estate or any other matter, penalties for various offences, jurisdiction of courts, previous sanction of the central government for prosecution, power to make rules, repeal and savings. the aforesaid provisions of the tea act, 1953 show that the said act was made by parliament on tea industry in exercise of its powers under entry 52 of list i of the 7th schedule of the constitution.7. by the tea (amendment) act, 1976, chapter iii a was introduced into the tea act, 1953 and sections 16 a to 16 n made various provisions relating to management or control of tea undertakings or tea units by the central government in certain circumstances. section 16a contains definitions for the purpose of the said chapter iii a. section 16b empowers the central government to cause investigation to be made in relation to a tea undertaking or tea unit under certain circumstances. section 16c provides that on completion of investigation, the central government has power to issue directions to the tea undertakings or tea units concerned for the purpose of regulating or stimulating the production and for the purpose of controlling the price and distribution of tea. section 16d, on the other hand, empowers the central government to assume the management or con trol of tea undertakings or tea units in certain cases including cases where average yield of tea undertakings or tea units for three years is lower than the district average yield by twenty-five percent or more. similarly section 16e confers power on the central government to takeover tea undertakings or tea units without investigation under certain circumstances including cases where production of tea manufactured or produced by the tea undertakings or tea units had been affected by various acts of persons incharge of the tea undertakings or tea units. sections 16 f to 16 l make provisions which are supplemental or consequential to the takeover of management of the tea undertakings or tea units by the central government under sections 16 d and 16 e of the act. section 16h in particular provides that if at any time it appears to the central government that the purpose of the order made under section 16 d or 16 e has been fulfilled or that for any other purpose it is not necessary that order should remain in force, the central government may cancel such order and on cancellation, of such order, the management or control, as the case may be, of the tea undertakings or tea units shall vest in the owner of that undertaking or unit. these provisions in sections 16 a to 16 n in chapter iii a of the tea act, 1953, are therefore provisions made by the parliament in exercise of its powers under entry 52 of list i as well -as its powers under entry 33 of list iii of the 7th schedule of the constitution which confer concurrent power in parliament and the legislature of a state to make law relating to production; supply and distribution of the products of any industry where the control of such industry by the union is declared by parliament by law to be expedient in public interest.8. coming now to the impugned ordinance and the impugned act, it is not necessary to deal with the provisions of the impugned ordinance as they have been incorporated in the impugned act. the long title of the impugned act states that it was an act to provide for takeover of management of certain tea units specified in the schedule 'with a view to securing proper reorganisation and management of such tea units so as to subserve the interest of the general public by augmenting the production and manufacture of tea varieties which are essential to the needs of the economy of the state and for matters connected therewith and incidental thereto'. section 3 of the impugned act provides for takeover of the management of the undertakings of tea companies in relation to tea units. sub-section (1) of section 3 stipulates that on and from the appointed day, the management of the undertakings of the tea companies in relation to the tea units shall vest in the state government for a period of five years. proviso to sub-section (1) of section 3, however, enables the state government to extend the said period of five years by further period not exceed-ipg one year subject to total, of two years after the expiry of five years as aforesaid. sub-sections (2) tp (8) of section 3 make various supplemental and consequential provisions relating to such takeover of the management of the undertakings of the tea companies by the state government. sub-section (1) of section 4 states that the state government may appoint any person, co-operative society or body of persons as the custodian of one or more of the tea units for the purpose of carrying on the management of such tea units and the custodian so appointed shall carry on the management of the tea units for and on behalf of the state government. sub-sections (2) to (9) of section 4 make provisions with regard to the manner in which the custodian so appointed by the state government will takeover possession of the assets of the company and carry on management of the tea units for and on behalf of the state government. section 5 provides for the payment of amount by the state government to the tea company the management of which has been taken over under the act by the state government. section 6 confers power on the state government to make certain declarations in relation to certain tea units. sub-section (1) of section 6 is quoted herein below. - '(1) the state government may, if satisfied, in relation to any tea unit or any part thereof, the management of which has vested in it by the act that it is necessary so to do in the interest of the general public, with a view to preventing any fall in the volume of production of tea by such tea units, by notification declare that the operation of all or any of the contracts, assurances of property, agreements, settlements, awards, standing order or other instruments in force (to which such tea units or the tea company owning such tea unit is a party or which may be applicable to such tea unit) immediately before the date of issue of the notification shall remain suspended or that all or any of the rights, privileges, obligations and liabilities accruing or arising there under before the said date, shall remain suspended or shall be enforceable with such adaptation and in such manner as may be specified in the notification.explanation -- for the purpose of this subsection 'award' shall not include an industrial award.'the aforesaid sub-section (1) of section 6 showsthat the state government could suspend thelegal obligations of a tea company the management of which has been taken over by the stategovernment under the impugned act with a viewto prevent any fall in the volume of production oftea by a tea unit. sections 7 to 15 contain somemiscellaneous provisions such as the overridingeffect of the impugned act (section 7), the application of companies act, 1956, (section 8),exclusion of period of operation of the impugnedact from limitations (section 9), protection of anaction taken on good faith (section 10), power toterminate contract of employers (section 11),penalties (section 12), offence by companies(section 13), power to make rules (section 14)and repeal and savings (section 15). it is thusclear that the impugned act has been made forthe purpose of augmenting production of tea bythe tea units by vesting the management of the teaunits in the state government for a period of fiveto seven years and by empowering the stategovernment to suspend contracts, assurances ofproperties, agreements, settlements, awards,standing orders or other instruments with a viewto prevent any fall in the volume of tea by the teaunits. the impugned ordinance and the impugnedact are thus in pith and substance law relating toproduction of tea in the state of tripura and hasbeen made by the governor and the state legislature in exercise of powers under entry 33 oflist iii read with article 246(2) of the constitution. 9. mr. chakravorty, learned counsel for the petitioner, however, vehemently submitted that entry 33 of the list iii of the 7th schedule of the constitution relates to production, supply and distribution of products of an industry the control of which by the union is declared by parliament by law to be expedient in the public interest and does not cover the production, supply and distribution of the raw materials of such industry. in support of this submission, he cited the decision of the supreme court in the case of tikaramji v. state of up., air 1956 sc 676. he argued that under the impugned ordinance and the impugned act, not only the management of the tea factory of the tea units but also the management of the tea garden of the tea units had been taken over by the state government. according to him, since the production of tea in the tea garden means production of the raw material for the tea industry and does not mean the production of the product of the tea industry, the impugned ordinance and the impugned act does not fall under entry 33 of the list iii of the 7th schedule of the constitution. even if the production of tea as raw material is not covered under entry 33 of the list iii of the 7th schedule of the constitution, such production of tea as raw material would be covered by entry 27 of list ii of the 7th schedule of the constitution. under the said entry 27 of the list ii of the 7th schedule of the constitution read with article 246(3) of the constitution it is the state legislature which has the power to make law relating to production, supply and distribution of goods which would include also raw materials as per the decision of the supreme court in the case of tikaramji v. state of u.p. (supra) cited by mr. chakravorty. in our considered opinion, therefore, the impugned ordinance and the impugned act have been made in exercise of the powers of the governor and the state legislature to make law under entry 27 of list ii and entry 33 of list iii of the 7th schedule of the constitution.10. it is true that the impugned ordinance and the impugned act have effect on the tea industry in the state and therefore encroached upon the entry 24 of the list ii which was subject to, entry 52 of list i of the 7th schedule of the constitution but it does not contain provisions to control or regulate the tea industry as such and therefore is not a legislation on tea industry. it has been held by the supreme court in kannan devan hills produce company ltd. v. the state of kerala, air 1972 sc 2301. 'effect is not the same thing as subject-matter. if the state act, otherwise, valid, has effect on a matter in list i it does not cease to be a legislation with respect to an entry in list ii or list iii.'similarly, in the case of ishwari khetan sugar mills v. state of u.p., air 1980 sc 1955, the supreme court held: 'when validity of a legislation is challenged on the ground of want of legislative competence and it becomes necessary to ascertain to which entry in the three lists the legislation is referable to, the court has evolved the theory of pith and substance. if in pith and substance a legislation falls within one entry or the other but some portion of the subject-matter of the legislation incidentally trenches upon and might enter a field under another list, the act as a whole would be valid notwithstanding such incidental trenching. this is well established by a catena of decisions (see union bt india v. h. s. dhillon, (1972) 2 scr 33 : air 1972 sc 1061 and kerala state electricity board v. indian aluminium co. ltd., (1976) 1 scr 552 : air 1976 sc 1031. after referring to these decisions in state of karnataka v. ranganatha reddy, (1978) 1 scr 641: air 1978 sc215 untwalia, j, speaking for the constitution bench has in terms stated that the pith and substance of the act has to be looked 'into and an incidental trespass would not invalidate the law.'since the impugned ordinance and the impugned act are in pith and substance law relating to production of tea falling under entry 33 of list iii of the 7th schedule of the constitution and entry 27 of list ii of the 7th schedule of the constitution in respect of which the state legislature has power under articles 246(2) and 246(3) of the constitution, the fact that it is also a legislation affecting the tea industry in the state of tripura and incidentally trespass into the field covered under entry 52 of list i of the 7th schedule of the constitution reserved to the parliament will not invalidate the said ordinance and the act.11. in hingir coal co. v. state of orissa, (air 1961 sc 459) (supra) cited by mr. chakravorty, the validity of orissa mining areas development fund act, 1952 was challenged on the ground that the power of the state legislature under entry 23 of list ii of the 7th schedule of the constitution to make law relating to regulation of mines and mineral development was subject to provisions of entry 54 of the list i which empowered the parliament to make law relating to regulation of mines and mineral development to the extent to which such regulation and development under the control of union is declared bylaw to be expedient in the public interest. the supreme court held that the jurisdiction of the state legislature to make law relating to regulation of mines and minerals development would be excluded if parliament by its law declared that regulation and development of mines should in the public interest be under the control of union, but since the court found that no such declaration had been made by the parliament after commencement of the constitution, the supreme court upheld the constitutional validity of the said orissa act. in the state of orissa v. m. a. tullock, (air 1964 sc 1284) (supra) cited by mr. chakravorty, however, the supreme court found that parliament had enacted the mines and minerals regulation and development act, 1957, under entry 54 of list i of the 7th schedule of the constitution and the supreme court held that since the said act contained the requisite declaration by the union parliament under entry 54, the entire field of mineral development on which the said central act had been enacted was excluded from the power of the state legislature under entry 23 of list ii of the 7th schedule of the constitution. in itc v. state of karnataka (1985 (supp) scc 476) (supra) on which great reliance was placed by mr. chakravorty, fazal ali, j., held that once the parliament takes over an industry under entry 52 of list i and passes an act to regulate the industry, the state legislature ceases to have the power to legislate in the field and if it does so, the state legislation would be ultra vires. in that case, the supreme court struck down the karnataka agricultural produce marketing (regulation) act, 1966, in so far as it levied market fee in respect of tobacco because the said provision for levying market fee directly collided with the tobacco board act, 1975, enacted by the parliament under entry 12 of list i of the 7th schedule of the constitution. in the said case, fazal ali, j, further observed that if the. president's assent would have been taken it would not validate the said karnataka act so far as tobacco industry is concerned because article 254 (2) applies only to matter only in the concurrent list and had nothing to do with the matters in lists i and ii. these decisions of the supreme court cited by mr. chakravorty are of no assistance to him, because we have held that the impugned ordinance and the impugned act are not in pith and substance law relating to tea industry under entry 24 of list ii which was subject to entry 52 of list i of the 7th schedule of the constitution but are in pith and substance legislations on entry 27 of list ii and entry 33 of list iii of the 7th schedule of the constitution in respect of which the state legislature has power to make law.12. this takes us to the contention of mr. chakravorty, learned counsel for the petitioner, that the provisions of the impugned act and the impugned ordinance are hit by sections 16 a to 16 n of the tea act, 1953. mr. chakravorty, in particular, referred to the provisions of sections 16d and 16 e of the tea act, 1953, under which the central government can take over the management of the whole or any part of the tea undertakings or tea units under certain circumstances . this contention of mr. chakravorty overlooks the provisions of sub-section (3) of section 8 of the impugned act which is to the following effect: '8. (3) the provisions of this act shall not be in derogation to the provisions of the tea act, 1953 or any other central law relating to tea industry and nothing contained in this act shall exempt any person or body of person, who may, for the time being, be entrusted with the management of a tea unit under this act from the operation of the provisions of any such central law.'hence, the impugned act itself states that its provisions will not be in derogation of the provisions of the tea act, 1953. regarding the power of the central government under the tea act, 1953 to take over the management of tea units, no order as such has been passed by the central government either under section 16d or section 16e of the tea act, 1953 taking over the management of whole or any part of tea under-takings and tea units in the state of tripura. in the absence of such an order made by the central government under section 16d or 16e of the tea act, 1953, there is no case of repugnancy between the provisions of the tea act, 1953 and the impugned ordinance and the impugned act. this is because repugnancy must exist in fact and not depend on a possibility of an order being passed by the central government under section 16d or section 16e of the tea act, 1953. ashas been held by the supreme court in, tikaramji v. state of u.p. (air 1956 sc 676) (supra): 'even assuming that sugarcane was an article or class of articles relatable to the sugar industry within the meaning of section 18-g of act 65 of 1951 it is to be noted that no order was issued by the ceritral government in exercise of the powers vested in it under that section and no question of repugnancy could ever arise because, as has been noted above, repugnancy must exist in fact and not depend merely on a possibility. the possibility of an order under section 18-g being issued by the central government would not be enough. the existence of such an order would be the essential perquisite before any repugnancy could ever arise.'13. at any rate, the impugned act has received the assent of the president and the consequence of such assent of the president to an act made by the legislature has been provided in article 254 of the constitution. article 254 is quoted hereinbelow; '254. inconsistency between laws made by parliament and laws made by the legislature of states.-- (1) ifany provision of a law made by the legislature of a state is repugnant to any provisions of a law made by parliament which parliament is competent to enact, or to any provision of an existing law with respect to one of the matters enumerated in the concurrent list, then, subject to the provisions of clause (2), the law made by parliament, whether passed before or after the law made by the legislature of such state, or, as the case may be the existing law, shall prevail and the law made by the legislature of the state shall, to the extent of the repugnancy, be void.(2) where a law made by the legislature of a state with respect to one of the matters enumerated in the concurrent list contains any provision repugnant to the provisions of an earlier law made by parliament or an existing law with respect to that matter, then, the law so made by the legislature of such state shall, if it has been reserved for the consideration of the president and has received his assent, prevail in the state.provided that nothing in this clause shall prevent parliament from enacting at any time any law with respect to the same matter including a law adding to, amending, varying or repealing the law so made by the legislature of the state.'a reading of clause (2) of article 254 of the constitution would show that where a legislature of a state makes a law in respect to the matter enumerated in concurrent list and such law contains any provision repugnant to the provisions of a law earlier made by the parliament, then the law so made by the legislature of a state, if it has been reserved for the consideration of the president and has received its assent shall prevail in the state. since, we have already held that the impugned act in so far as it provides for takeover of the management of the tea units mentioned in the schedule to the act for the purpose of augmenting the production of tea as a final product has been made in respect to a matter in entry 33 of concurrent list and has received the assent of the president, the provisions of the impugned act even if held to cover the same field as sections 16d and 16e of the tea act, 1953 cannot be struck down on the ground that it is repugnant to the said provisions of the tea act, 1953. further, the impugned act in so far it also empowers the state government to takeover the management of the tea gardens of tea units is a legislation in respect of matter under entry 27 of list ii of the 7th schedule of the constitution on production of tea as a raw material and is within the exclusive powers of the state legislature and cannot be struck down on the ground that it is repugnant to the provisions in sections 16d and 16e of the tea act, 1953. the contention of mr. chakravorty, therefore, that the impugned ordinance and the impugned act are ultra vires the constitution and the tea act, 1953 fails, '14. it was next contended by mr. chakravorty that the sale of the two tea estates belonging to the petitioner companies for recovery of land revenue was fraudulent, illegal, invalid, ultra vires and contrary to the procedure established by law. he argued that under section 22 of the tripura land-revenue and land reforms act, 1960, (for short 'the 1960 act') the owner of the tea estate was liable to pay land revenue in respect of the land comprising the tea estates.-hence notices in case default in payment of land revenue have to be served on the owners of the tea estates as required by section 62 of the 1960 act. since the management and possession of the tea estates was with the state government under the impugned ordinance and the impugned act with effect from november, 1986, in case there was defaultin payment of landrevenue, notices should have been served on the petitioner companies at calcutta as they were the owners of the land and were liable to pay land revenue under the aforesaid act. but no such notices were served on the two petitioner companies at calcutta and instead notices for default in payment of land revenue totalling to rs. 10,776.26 for the period from 14-4-1986 to 13-4-1987 and 14-4-1987 to 13-4-1988 were served on the two tea estates under the management and possession of the state government. mr. chakravorty submitted that the affida-vit-in-opposition of the state respondents would show that all notices as prescribed by the tripura land revenue and land reforms rules, 1961, (for short 'the 1961 rules') in forms 24,25 and 27 and the proclamation in form 28 were not served on the petitioner companies at calcutta who were owners'of the land comprising the tea estates and instead were purportedly served at the tea estates which were under the management and possession of the state government. he vehemently contended that the value of the tufanialonga tea estate was rs. 1.06 crores and the value of laxmilonga tea estate was rs. 85.00 lakhs as per the estimate made in the affidavit-in-opposition filed by the respondents and yet the two tea estates were sold at a nominal price of re. 1/- each to the state government without proclamation of sale being published in any newspaper having wide circulation as per rules 99(2) and 99(3) of the 1961 rules. he 'pointed out that the affidavit-in-opposition filed by the state respondents would further show that there was stock of tea lying in the factories of the two tea estates when they were taken over by the state government in the year 1986 and the said stock of tea were sold at a total sum of rs. 46,911.44 and the aforesaid amount of sale proceeds of tea was sufficient to pay off the arrear land revenue of rs. 10,776.26 and there was absolutely no necessity of selling the two tea estates for recovery of the arrear land revenue. he pointed out that the petitioners filed an application for setting aside the sale before the district collector under rule 73(a)of the 1961 rules and the district collector in his order dated 30-11-1992 observed that notices were not properly served on the owners of the tea estates at calcutta before the sale was made, the sale of the two tea estates was disproportionate to the arrear of land revenue and was contrary to section 70 of the 1960 act and that the owner companies should have been given a chance of payment of liability of revenue. but the district collector refused to set aside the sale on the ground that the application for setting aside the sale ,was filed well beyond the period of limitation. mr. chakravorty explained that the delay in filing the application before the district collector for setting aside the sale was on account of the fact that certified copies of the relevant orders in the certificate proceedings leading to the sale of the two tea estates though applied for on 23-12-1991 were not furnished to the petitioners at all. he cited the decision in nani gopal paul v. t. prasad singh, air 1995 sc 1971, in which the supreme court held that the court would not remain mute spectator to obvious manifest illegality committed in conducting the court sales even if application for setting aside of the 'safe was not filed in time. he ajso relied on the decision of the full bench of the calcutta high court in purna chandra chatterjee v. dinabandhu chatterjee, (1907) ilr 34 cal 811, in which a sale of property without service of notice under section 10 of the public demands recovery act was held to be without authority and a nullity. he contended that since in the present case the sale of the two tea estates at a nominal price of re. 1/- per tea estates was fraudulent, illegal and in gross violation of the provisions of the 1960 act and the 1961 rules, the sale was liable to be set aside by this court. in this context, he stated that other tea estates which had been similarly sold for recovery of land revenue to the state government at a nominal price have been restored to the respective owners by order of the tribunal before whom the sale of the tea estates were challenged.15. mr. b.k. das, learned counsel appearing for the respondent no. 6 united bank of india supported the said contentions of mr. chakravorty and submitted that the respondent no. 6 had advanced a loan of rs. 20.00 lakhs to the petitioner companies and the properties of the petitioner companies had been furnished as equitable mortgage for the aforesaid loan. mr. das pointed out that the said loan of rs. 20.00 lakhs had accumulated with interest to rs. 1.20 crores as stated-in the affidavit-in-opposition filed by the respondent no. 6 and that the sale of the two tea estates to the state government at the nominal price of re 1/- had deprived the respondent no. 6 of its security against the said dues of rs. 1.20 crores.16. mr. bhattacharjee, learned advocate general, tripura on the other hand, submitted that the sale of the two tea estates have been made in accordance with the provisions of the 1960 act and the 1961 rules. he submitted that under section 65 of the 1960 act, the immovable properties of a defaulter could be sold for recovery of arrear of land revenue. he also referred to rule 102 of the 1961 rules which provided that where a property is put to auction for recovery of arrears of land revenue and there is no bid the revenue officer conducting the sale can purchase the same in the name of administrator for re 1/-. according to mr. bhattacharjee, the sale of the two tea estates at the nominal price of re 1/- each was, therefore, authorised by the 1961 rules. mr. bhattacharjee vehemently argued that since rule 102 of the 1961 rules providing for the sale of a property at a nominal price of re 1/- has not been challenged in the present writ petition, the court should not interfere with the sales of the two tea estates. he further submitted that sections 93,.94 and 95 of the 1960 act provided alternative remedies by way of appeal and revision against any order passed by the revenue officer but the petitioners have not availed the said alternative remedies provided by the statute against the sales of the two tea estates and the court should refuse to exercise its powers under article 226 of the constitution of india on this ground alone. in support of this submission mr. bhattacharjee relied on the decision of the supreme court in shri ramdas motor transport limited v. tadi adhinarayan reddy, (1997) 5 scc 446 : (air 1997 sc 2189) and mafatlal industries limited v. union of india, (1997) 5 scc 536. he also contended that the collector rightly rejected the application of the petitioners under section 73(a) of the 1960 act for setting aside the sale on the ground that it was barred by limitation. he submitted that the petitioners approached the collector and has approached this court for setting aside the sales after considerable delay and on this ground alone, this court should refuse to set aside the sales of the two tea estates. he finally submitted that the petitioners 'are riot in a position to run the tea estates and the tea factories and a large number of workmen employed therein are likely to be affected if the sales are set aside by the court. he cited the decision of the supreme court in state of rajasthan v. d.r. laxmi, (1996) 6 scc 445 : (1996 air scw 3970), in which the supreme court held that when there is inordinate delay in filing the writ petition and when all steps taken in the acquisition proceeding have become final, the court should be loathe to quash the notification under section 4(1) and the declaration under section 6 of the land acquisition act, 1894.17. sections 22, 62, 63, 64, 65, 66 and 70 of the 1960 act and rules 89, 90, 95, 99, 102 and paragraphs 25 and 32 of schedule iii of the 1961 rules which are relevant are extracted herein below; '22.(1) the following persons shall be primarily liable for the payment of land revenue assessed on land, namely- (a) the person to whom the land belongs;(b) the under raiyat or any other person in possession of the land, provided that such under-raiyat or other person shall be entitled to credit from the owner of the land for the amount paid by him.(2) where there are two or more persons liable to pay land revenue under sub-section (1) all of them shall be jointly and severally liable for its payment.62. an arrear of land revenue may be recovered by any one or more of the following processes, namely (a) by serving a written notice of demand on the defaulter;(b) by distraint and sale of the defaulter's movable property including the produce of the land;(c) by the attachment and sale of the defaulter's immovable property.63. the form and contents of the notice of demand and the officers by whom such notices shall be issued shall be such as may be prescribed.64. (1) the distraint and sale of the movable property of a defaulter shall be made by such officers or class of officers in such manner and in accordance with such procedure, as may be prescribed.(2) nothing in sub-section (i) shall be deemed to authorise the distraint or sale of any property which, under the code of civil procedure, 1908, is exempt from attachment or sale in execution of a decree or of any article set aside exclusively for religious use.65. (1) when the collector is of opinion that the processes referred to in clauses (a) and (b) of section 62 are not sufficient for the recovery of an arrear, he may, in addition to or instead of any of those processes, cause the land in respect of which such arrear is due to be attached and sold in the prescribed manner.(2) the collector may also cause the right, title and interest of the defaulter in any other immovable property to be similarly attached and sold.66. (1) before effecting the sale of any land or other immovable property under the provisions of this chapter, the collector or other officer empowered in this behalf shall issue such notices and proclamations, in such form, in such manner and containing such particulars, as may be prescribed; the notices and proclamations shall also be published in such manner as may be prescribed.(2) a copy of every notice or proclamation issued under sub-section (1) shall be served on the defaulter.70.' every sale of property, movable or immovable under the provisions' of this chapter shall, as far as may be practicable, be proportionate to the amount of the arrear of land revenue to be recovered together with the interest thereon and the expenses of attachment and sale.' the tripura land revenue and land reforms rules, 1961.'89. (1) a notice of demand under section 62 shall be issued in form 24 by and under the signature and seal of the circle officer of the circle in which the holding to which the land revenue relates is situated. if such notices are required to be issued against a defaulter residing in another circle, the circle officer may do so either direct or through the circle officer of such other circle.(2) a sub-divisional officer or collector any (may?) issue a notice of demand in respect of the land revenue payable on account of any holding which is situated within his jurisdiction.(3) it shall be issued in duplicate and shall be served in the manner of a notice as prescribed in schedule iii.(4) the fee for the notice of demand shall be added to the arrears for which the notice is issued and shall be included in the amount specified therein.90. (1) any officer, sub-divisional officer or circle officer may issue a warrant of distraint or movable property including the produce of the land of any defaulter in form 25 and sell the same thereafter by public auction.(2) such auction shall be held at the spot unless the officer ordering the auction is of the opinion that the auction if held in any other place would bring a higher price in which case auction may be held at such other place.(3) if the auction is not held at the spot, due publicity thereof shall be given by issuing a proclamation in form 26 which may also be proclaimed by beat of drum, if the officer ordering the sale deem it necessary.95. (1) where the property is immovable property, the attachment shall be made by an order in form 27 issued by the collector prohibiting the defaulter from transferring or charging the property in any manner and all perspns from having any transfer or charge from him.(2) in addition to service provided for the service of a notice in schedule iii, a copy of the' prohibitory order shall be affixed at a conspicuous part of the property and shall be proclaimed in the locality by beat of drum.(3) the order shall take effect as against transferees for value in good faith from the date when a copy of the order is affixed on the property and against all other transferees from the date on which such order is made.(4) no payment made after the making of the proclamation on account of rent or any other asset of the estate or holding to any person other than the collector or his agent shall be credited to the person making the payment or relieve him from liability to make the payment to the collector or his agent.99. (1) when the sale of any immovable property is to be held, the proclamation for sale shall be issued in form 28 if the, property to be auctioned is the holding on account of which the arrears are due and in. form 29 if it is some other property belonging to the 'defaulter.(2) the officer conducting the sale shall cause wide publicity of the proclamation of sale to be made and may, in addition to other proc esses provided for such publicity in para 33 of schedule iii, get it published in any newspaper having circulation in the area. ;(3) the proclamation of the intended sale shall state the date time and place of the same and specify the following as clearly and accurately as possible- i) the property to be sold;ii) estimated value of the property;iii) the amount for the recovery of which the sale is ordered; andiv) such facts which the authority considers material to note in the proceeding in order to charge full and fair value of the property including such other circumstances as a purchaser ought to know.(4) the proclamation 'mentioned in sub-rule (3) shall be served under sub-section (2) of section 66 on the defaulter as provided in paras 22 to 31 of schedule iii.(5) the authority issuing the proclamation may summon the defaulter and examine him with respect to any manner which is to be included in the said proclamation.(6) the place of sale to be specified under sub-rule (3) shall be either the office of the circle officer or any place near the property to be sold.102. when a property is being put to auction, for arrears of land revenue and there be no bid, the revenue officer conducting the sale may purchase the same in the name of the administrator for one rupee or if the highest bid be insufficient to cover the arrears due may purchase the property on behalf of the state government at the highest bid.' schedule iii procedure of revenue courts 25. a summons shall, if practicable, be served (a) personally on the person to whom it is addressed or failing him (b) on his recognised agent or (c) on any adult male member of his family usually residing with him.(2) if service cannot be effected as above, or if acceptance of service so made is refused, the summons may be served by pasting a copy thereof on the door of the usual or last known place of residence of the person to whom it is addressed or by publication in a newspaper.32. every notice under the act be served either by tendering or delivering a copy thereof, or sending such copy by post to the person on whom it is to be served, or his authorised agent or, if service in the manner aforesaid cannot be made by affixing a copy thereof at his last known place of residence or at some place of public resort in the village in which the land to which the notice relates is situated,' section 22 provides that the person to whom land belongs shall be primarily liable for payment of land revenue assessed on the land. section 62 further provides that arrear land revenue may be recovered by one or more of the processes mentioned therein.18. one of the processes mentioned in section 62, is by serving notice of demand on the der fauher. since the owner of the land is primarily liable tor payment of land revenue under section 22 when the land revenue is not paid, the owner of the land is the defaulter. hence a written notice of demand has to be served on the owner of the land. section 63 states that the form and content of notice of demand and the officer by whom such notice shall be issued shall be such as may be prescribed. rule 89 (1) prescribes that notice of demand under section 62 shall be issued in form 24 and rule 89 (3) further prescribes that such notice of demand shall be issued in duplicate and shall be served in the manner as prescribed in schedule iii. paragraph 32 of the schedule iii states that every notice may be served by either tendering delivery of a copy thereof, or sending such copy by post, to the person on whom it is to be served, or his authorised agent, or if service of notice in the manner as aforesaid cannot be made, by fixing acopy thereof at his last known place of residence or at such place of public resort in the village in which the land to which notice relates is situated. the aforesaid provisions of the 1960 act and the 1961 rules make it clear that a notice of demand of arrear of land revenue has to be served on the owner of the land in form 24 either by tendering or delivering a copy thereof or sending such copy by post to the owner of the land, or his authorised agent, and only if service in the aforesaid manner cannot be made, by fixing a copy thereof at the last known place of residence of the owner or at some place of public resort in the village in which the land to which notice relates is situated. in the instant case. annexures r series of the affidavit filed by the state respondents show that on 3-6 1986 notices of demand in form 24 were issued. in respect of notice of demand for laxmilonga tea estate, an arrear of land revenue of rs. 6629.92 plus re 1/- towards process fee for a total land measuring 569.27 acres was demanded to be paid within 7 days from the date of receipt of the notice. but the said notice of demand was not delivered at or sent to the registered office of the petitioner company at calcutta and was instead hung on a tree at the spot by the process peon shri mali chahd debverma on 11-3-1987 and signature of two witnesses sugra munda and munia munda were obtained. similarly, in the notice of demand in respect of tufanialonga tea estate, an arrear of land revenue of rs. 4137.34 plus re 1/- process fee for the land measuring 426,36 acres was demanded to be paid within 7 days from the date of receipt of the demand notice. but the said demand notice was not delivered at or sent to the registered office of the petitioner company at calcutta but was hung on a tree at the spot by the process peon shri mali chand debverma on 11-3-1987 after taking signature of two witnesses supra munda and nunis munda. on the date on which the aforesaid demand notices were hung on the trees at the spots, the tea estates were under the management and possession of the tripura tea development corporation limited appointed as custodian of the properties of the tea estates under the impugned ordinance and the impugned act by the state government and the two petitioner companies or their authorised agents were not in the management and possession of the two tea estates when the notices were hung on the trees of the respective tea estates. the provisions of the 1960 act and the 1961 rules and in particular paragraph 32 of schedule iii of the 1961 rules required that the notice of demand was first sent or delivered to the petitioner companies at their registered offices at calcutta or to their authorised agents, and only if service in the aforesaid manner could not be made, by affixing a copy of the notice at the lastknown address of the petitioner companies or some place of public resort in the village in which the land to which the notice relates is situated. but in the instant case without even attempting to serve the notices of demand at the registered office of the two petitioner companies at calcutta or on their authorised agents, if any, the notices of demand were hung at some tree of the spot taking signature of two persons. in our considered opinion, therefore, the notices of demand have not been served on the petitioner companies in accordance with the provisions of sections 22 and 62 of the 1960 act and rule 89 read with paragraph 32 of the schedule iii of the 1961 rules.19. the second mode of recovery of land revenue as provided in section 62 of the 1960 act is by distraint and sale of movable properties including the produce of the land. section 64(1) however, states that the distraint and sale of movable properties of a defaulter shall be made by such officers or class of officers in such manner and in accordance with such procedure, as has been prescribed. rule 90( 1) prescribes that warrant of distraint of movable properties of any defaulter is to be issued in form 25. annexure-r series of the affidavit of the state respondents show that in the case for recovery of land revenue of laxmilonga tea estate on 10-7-1986 from 25 was sent to the tehshil office. the distraint warrant in form 25 was thereafter sent to the in-charge devendra chandranager tk who wrote behind the said form 25 on 30-6-1986 that there was no movable properly and returned the distraint warrant to the certificate officer without execution. similarly, in the case relating to recovery of land revenue of tufanialonga tea estate on 11-6-1986 form 25 was issued for distraint of movable property and was sent to tehshil. thereafter, the distraint warrant in form 25 was sent to the in-charge devendra chandranager tk who wrote behind the said form 25 that there was no movable property and he returned the distraint warrant without execution to the certificate officer. it is thus clear that form 25 was not sent to the two petitioner companies at calcutta who were defaulters of the arrear land revenue and some one other than defaulter or the authorised agent of the defaulter has returned the distraint warrants with a note that there was no movable property.20. still the third mode of recovery of arrear of land revenue under section 62 of the 1960 act is by attachment and sale of immovable property of the defaulter as stated in section 62 of the 1960 act. but section 65(1) makes it clear that the collector can cause the land in respect of which arrear of land is due to be attached and sold in the prescribed manner only if he is of the opinion that the first two modes of recovery namely service of written notice of demand on the defaulter and warrant of distraint and sale of the defaulter's movable properties are not sufficient for the recovery of the arrear land revenue. section 66(1) further provides that before effecting sale of any land or other immovable property, the collector or other officer empowered in this behalf shall issue such notices and proclamation in such form in such manner and containing such particulars, as may be prescribed, and the notice of proclamation shall also be published in such manner as may be prescribed. sub-section (2) of section 66 further states that copies of every notice of proclamation issued under sub-section (1) shall be served on the defaulter. rule 95(1) prescribes that the attachment of immovable property shall be made by an order in form 27. rule 95(2) further prescribes that in addition to service as provided for service of notice in schedule iii, a copy of prohibitory order shall be fixed at a conspicuous part of the property and shall be proclaimed in the locality by beat of drum. it is thus clear that form 27 has to be served on the defaulter in the manner prescribed by paragraph 32 of schedule iii of the 1961 rules. annexure r series showthat in respect of laxmilonga tea estate on 25-1-1987 prohibitory order in form 27 was issued and was served by the peon shri mali chand debverma on someone of laxmilonga tea estate. in para 37 of the affidavit filed on behalf of the respondents nos. 1,2,3 and 5 it is stated that the notice in form 27 was received by the employee of laxmilonga tea estate. paragraph 32 of the schedule iii of the 1961 rules requires that notice is to be served on the person on whom it is to be served or his authorised agent. since the petitioner company was the defaulter and form 27 was required to be served as per provisions of section 66(2) on the defaulter, form 27 had to be served either on the petitioner company or its authorised agent. the management and possession of laxmilonga tea estate at the time the aforesaid form 27 was served was with the tripura tea development corporation limited as custodian appointed by the state government under the impugned ordinance and the impugned act. receipt of form 27 by an employee working under the saidcorporation would, therefore, not amount to receipt either by the petitioner company or by its authorised agent. similarly, in the case of tufanialonga teaestate, the prohibitory order in form 27 was issued and the peon shri mali chand debverma went to tufanialonga tea estate and served the notice on 10-3-1987. nothing however, has been stated in the affidavit of the state respondents as to who received the notice on 10-3-1987 on behalf of the tufanialonga tea estate. the'fact remains that on 10-3-1987, the management and possession of the said estate was with the tripura tea development corporation limited as the custodian appointed by the state government under the impugned ordinance and the impugned act. hence serving of form 27 on some person at the tea estate was not a service on the petitioner company or its authorised agent as provided in paragraph 32 of the schedule iii of the 1961 rules..21. rule 99(1) prescribes that the proclamation for sale of immovable property is to be issued in form 28 and rule 99(2) further provides that the officer conducting the sale shall cause wide publicity of the proclamation of sale. rule 99(4) further prescribes that the proclamation shall be served under sub-section (2) of section 66 on the defaulter as provided in paragraphs 22 to 31 of the schedule iii. annexure-r series show that on 30-4-1987 form 28 was issued in respect of laxmilonga tea estate fixing the date of auction to 2-6-1987 and on 6-5-1987 the peon shri mali chand debverma endorsed ' behind the said form 28 to the effect that he went to harendra nagar tea garden but the manager of the tea garden refused to take notice and put his signature and that he hung the notice on a tree nearby. similarly, on 30-4-1987 form 28 was issued in the case of tufanialonga tea estate fixing the date of auction to 2-6-1987 and on 6-5-1987 behind the said form 28 an endorsement has been made by the peon shri mali chand debverma to the effect that he went to the tufanialonga tea garden and requested the manager to receive the notice but he refused to receive the notice and put his signature and, therefore, he hung the notice on a tree. the provisions of paragraph 25 of schedule iii of the 1961 rules, required that the said form 28 were served on the petitioner companies or their recognised agents and if form 28 could not be served or if acceptance of service was refused. forms 28 could be pasted on the door of the usual or last known place of residence of the petitioner companies. but form 28 were not served on the petitioner companies at their addresses at calcutta or on their recognised agents as provided in the said paragraph 25 of schedule iii of the 1961 rules. annexure r series and in particular the copies of the order-sheets in the two cases for recovery of arrear land revenue do not show that wide publicity was given to the proclamation for sale in form 28 as provided in rule 99(2) of the 1961 rules. the said copies of the order-sheets further show that on 2-6-1987, 3-6-1987 and 4-6-1987 auction was taken up and as no bidder was present, the land of laxmilonga tea estate measuring 569.27 acres including all movable properties and the land of tufanialonga tea estate measuring 426.36 acres including all movable properties were sold in favour of the state government of tripura under rule 102 of the 1961 rules on payment of re 1/- in each case due to non-payment of land revenue of rs. 6639.92 and rs. 4147.34 respectively on 4-6-1987 and the said sales were confirmed by the district collector on 20-7-1987 under section 73 of the 1960 act and rule 106 of the 1961 rules as no petition for reconsideration of the sale was filed.22. the aforesaid discussion of the different steps that were taken in the two cases for recovery of arrear land revenue would show that the provisions of 1960 act and 1961 rules were not followed before the ultimate step was taken for sale of the movable and immovable properties of the two tea estates under rule 102 of the 1961 rules to the state government on payment of re. 1/- for each tea estate and for confirming the sales under section 103 of the 1960 act and rule 106 of the 1961 rules. section 65 of 1960 act made it abundantly clear that only when the collector was of the opinion that the process of serving of written notice of demand on the dafaulter and the process of distraint and sale of the movable properties of the defaulter were not sufficient for recovery of arrear of land revenue he could in addition to or instead of any of the aforesaid two processes, cause the land in respect of which such arrear is due to be attached and sold in the prescribed manner. unless, therefore, a written notice of demand was served on the defaulter in form 24 or an attempt was made to recover the arrear land revenue by serving a warrant of distraint of movable properties of the defaulter in form 25 on the defaulter and by selling such movable properties, the collector could not possibly take a view that such service of written notice of demand and such distraint and sale of defaulter's movable properties were not sufficient for recovery of the arrear of land revenue. that apart, section 70 provides that every sale of property movable or immovable, shall as far as may be practicable be proportionate to the amount of arrear of land revenue to be recovered together with interest thereon and the expenses for attachment and sale. in the instant case, the arrear of land revenue in one case was rs. 6639.92 and in other case was rs. 4147.34. the mandate of section 70 required that only a portion of the land the value of which was proportionate to the aforesaid amount of arrear of land revenue was ordered to be sold at the first instance so that the aforesaid amount of arrear land revenue together with interest thereon and the expenses of attachment and sale could be recovered. but it appears that at the very first instance the entire land of laxmilonga tea estate measuring 569.27 acres including all movable properties and the entire land of tufanialonga tea estate measuring 426.36 acres were sold at a price of re 1/- in each case contrary to the said mandate of section 70 of 1960 act. in our considered opinion therefore the sale of the two tea estates and confirmation of the sale in favour of the state government for re 17- for each tea estate was in gross violation of the provisions of the 1960 act and the 1961 rules and were beyond the jurisdiction of the collector and null and void. in nani gopal paul's case (air 1995 sc 1971) (supra) cited by mr. chakravorty, the supreme court held that the court would not remain a mute and helpless spectator to obvious and manifest illegalities committed in conducting court sales and set aside a court sale and confirmation of a court sale in which manifest illegalities were noticed by the court. we are of the view that since gross illegalities have been committed in selling valuable properties of the two petitioners at a nominal price of re 1/- for each tea estate to the state government in the present case, we should set aside the sales of the two tea estates and remand the matter to the collector for initiating fresh steps for recovery of the aforesaid arrear land revenue in accordance with the provisions of the 1960 actandthe 1961 rules as discussed above.23. it is true as has been submitted by mr. bhattacharjee that the petitioners could have challenged the aforesaid sales before the appropriate authority under the 1960 act and 1961 rules and, therefore, had alternative remedy against the sales under the statute. but the writ petition challenging the sales of the two tea estates was filed before this court on 2-2-1994 and admitted on 13-4-1994. the petitioners have waited for more than five years since 1994 before this court for relief against the illegal sales of their valuable properties at a nominal price of rs 1/-. it will not be proper exercise of our discretion under article 226 of the constitution to refuse to interfere with the sales on the ground that alternative remedy was available to the petitioners for challenging the sales after having admitted the writ petition about five years back. moreover, the illegalities in the sales of the two tea estates are apparent on the face of the records, copies of which have been annexed to the counter affidavit of the state respondents as annexures-r series. no disputed questions of facts were required to be decided for the purpose of finding out whether any illegality was committed. after having found that mainfest illegalities were committed in the sales of the two tea estates and that the sales of valuable properties at the nominal price of re 1/- for each tea estate were shocking to the judicial conscience, we will be failing in our duty as a court of justice if we do not set aside the sales.24. in the ease of shri ramdas motor transport limited (air 1997 sc 2189) (supra) cited by mr. bhattacharjee, the supreme court was not considering a case of a sale of valuable property made in gross violation of statutory provisions but was considering some disputes between the parties relating to the management of affairs of some companies. the supreme court found that under section 397 of the companies act any member of a company complaining that the affairs of the company are being conducted in a manner prejudicial to the public interest or in a matther oppressive to any member or members may apply to the company law board for an order under that section and that some of the share-holders of the appellant company had in fact filed a petition under sections 397 and 398 of the companies act before the company law board and the company law board was not taking any action in the matter. on these facts the supreme court held that as the share-holders had effective remedy under the companies act for prevention of oppression and mis-management, the high court should not readily entertain a writ petition under article 226 of the constitution merely on the ground that the company law board was not taking any action on the matter. in mafatlal industries limited (1997 (5) scc 536) relied on by mr. bhattacharjee the supreme court was also not considering a case of a sale of valuable property at a nominal price in violation of the statutory provi sions but of cases of refund of central excise duty paid to the department and the supreme court held that since section 118 of the central excises and salt act, 1944 provided a statutory remedy for such refund, the high court should not in exercise of its power under article 226 of the constitution direct refund of the central excise duty contrary to the said provisions of section 11-b of the act. in state of rajasthan v. d.r. laxmi (1996 air scw 3970) (supra) cited by mr. bhattacharjee again, the court was not considering a case of sale of valuable property at a nominal price in gross violation of statutory provisions but of a case of land. acquisition act, 1894 and held that where there is inordinate delay in filing the writ petition challenging a notification for acquisition of land under sections 4 and 17 of the said act and possession of the land had already been taken over either under section 17(2) or section 16 of the act and land stood vested in the state government free from all encumbrances, the court should be loathe to quash the notification and interfere with the acquisition of land by the state.25. the court also should not refuse to set aside the sales made in gross violation of the statutory provisions merely on the ground that petitioners were not in a position to run the tea units as a large number of workmen employed therein are likely to be affected if the sales of two tea estates are set aside. the court cannot be oblivious of the fact that in the case of laxmilpnga tea estate land measuring 569.27 acres including all movable properties therein were sold for re 1/- and in the case of tufanialonga tea estate the land measuring 426.36 acres including all movable properties therein were sold for re l/-and that the aforesaid land were mortgaged against a loan to the united bank of india and the said bank had a claim of rs. 1.20 crores against the petitioner companies. moreover, even if the sales are set aside a scheme for running the two tea units can always be negotiated between the parties to ensure that the workers in the two tea units are continued to be employed and at the same time the liabilities of the petitioner companies including those payable to the bank are paid. in case such a scheme is not possible it is also open for the central government to assume the management and control of the tea undertakings or units under sections 16d and 16e of the tea act, 1953, if such assumption of management and control of the tea undertakings and units were permissible under the said provisions of the tea act, 1953. in the facts of the present case therefore it will not be a proper exercise of discretion under article 226 of the constitution on the part of the court to refuse to set aside the sales of the two tea estates.26. it was next submitted by mr. chakravorty that ever since the management and possession of the two tea estates were taken over by the state government under the impugned ordinance and the impugned act in the year 1986 no compensation whatsoever has been paid to the petitioner companies. he referred to section 5 of the impugned act which states that each of the tea companies whose units have been taken over by the state govt. will be paid by the state an amount in cash at the rate to be specified by the state government and the amount so specified shall be paid every year during which management of the tea units remained vested in the state government under the act. relying on the affidavit-in-opposition of the state respondents, he submitted that the state government has not yet specified the amount in cash to be paid to the tea units for taking over of the management of the tea units. mr. chakravorty submitted that since under the arrangement between the state government and the tripura tea development corporation limited, the tripura tea development corporation limited has to pay a total sum of rs. 1,91,89,000/- by instalments for 10 years at a yearly payment of rs. 10.00 lakhs per garden, the state government should be directed to pay at the said rate per year with interest of 18% per annum for default in making regular yearly payment. mr. bhattacharjee the learned advocate general relied on the averments in their affidavit-in-opposition of the state respondents that the tripura tea development corporation limited has invested huge amount in the tea units of the petitioner for rehabilitation of the tea units taken over by the state government. mr. b.k. das, learned counsel for the united bank of india contended that the amount payable to the petitioner companies under section 5 of the impugned act should be paid by the state government to the said bank so that the liabilities of the petitioner companies to die bank can be adjusted. he cited 'the decision of b.l. hansaria j in b.c. chaturvedi v. union of india, air 1996 sc 484, that the high court has powers to do complete justice in a case and contended that if the amount was paid to the bank complete justice would be done in this case.27. section 5 of the impugned act is quoted herein below: 5. payment of amount-(1) each of the tea company shall be given by the state government an amount, in cash and at the rate to be specified by the state government, for vesting in it, under section 3 of the management of the undertakings of each such company in relation to such tea units and the amount so specified shall be paid every year during which the management of tea unit remains vested in the state government under this act.'by the aforesaid section 5 of the impugned act, the state govt. has been vested with the power to specify the rate at which the amount has to be paid to each of the tea companies management of which has been taken over under section 3 of the act. the said section further provides that the amount specified shall be paid every year during which the management of the tea unit is vested in state government under the act. thus, it is not for me court but for the state government to specify the rate at which the amount should be paid every year during which the management of the tea unit remained vested in the state government under the impugned act. admittedly, the state government has not specified the rate under section 5 of the act. thus the state government will have to specify the rate for which petitioner companies have to be paid for the period from 13-11-1986 when the management of the undertakings of the petitioner companies in relation to the two tea units were taken over under the impugned act till the two estates were sold on 4-6-1987 to the state government for recovery of the arrear of land revenue. the aforesaid section 5 of the impugned act does not say that the state government shall not pay the amount at the rate specified by the state government to the concerned tea company if any investment was made by the state government or the custodian appointed by it in the tea units during the period the management of undertakings in relation to tea units was with the state government or its custodian. the state government will therefore, have to pay the amount at the rate specified to the petitioner companies for the period from 13-11-1986 to 4-6-1987.28. during the period from 4-6-1987 onwards, however, the state government or the tripura tea development corporation limited continued to be in possession of the two tea units not by virtue of the provisions of the impugned act but on account of the sale of the two tea estates to the state government on 4-6-1987 in the proceedings for recovery of arrear land revenue. since we have held that the sales of the two tea estates on 4-6-1987 and the confirmation of the sales on 20-7-1987 by the collector were contrary to the provisions of 1960 act and the 1961 rules and were illegal and void, the court will have to work out the equities between the parties and grant reliefs to them. obviously the rate that is determined by the state government under section 5 of the impugned act for payment of the amount every year would constitute a reasonable basis for determining the compensation that may be payable by the state government to the petitioner companies for the period from 4-6-1987 onwards. but it appears from the affidavit dated 24-12-1998 filed by shri suresh chandra singh, under secretary to the government of tripura. department of industries and commerce, pursuant to order dated 26-31-1998 of this court that substantial amounts have been spent by the tripura tea development corporation limited out of its own funds and out of funds received from the state government by way of capital investment in the two tea units. further some amounts have also been paid to meet statutory liabilities of the workers. the figures of such capital investment and payment towards statutory liabilities of the two petitioner companies furnished in the said affidavit of the under secretary to the government of tripura, department of industries and commerce, however, have been disputed by the affidavit of shri sushenjif paul, constituted attorney and director of the two petitioner companies. the exact amounts of such capital investment actually made in the two tea units and the amounts of payment made towards statutory liabilities of the petitioner companies will have to be determined by the state government and the said amounts of capital investment and payment of the statutory liabilities of the petitioner companies will have to be deducted out of the amount to be paid by the state government to the petitioner companies as compensation for the period from 4-6-1987 onwards.29. we are unable to accept the submission ofmr. das. learned counsel for the united bank ofindia, that the amounts payable by the stategovernment to the petitioner companies shouldbe paid to the united bank of india and not to thepetitioner companies because a suit has beenfiled by the united bank of india against the twopetitioner companies for recovery of the dues ofthe bank and is presently pending before thedebt recovery tribunal. the united bank ofindia may move the said tribunal for appropriateorders in the said suit and this court in the presentproceeding cannot direct the state governmentto pay the amount due to the petitioner to theunited bank of india. '30. having held that the sales of the two tea estates, for recovery of the arrear land revenue were illegal and void we would have normally directed restoration of the possession of the two tea estates to the petitioner companies forthwith as the maximum period of 7 years for management of the tea units by the state government under the impugned act is over since 1993. but in the affidavit of the under secretary to the govt. of tripura, department of industries and commerce filed on 24-12-1998 pursuant to our order dated 26-11-1998, it is stated that in laxmilonga tea estate a total of 283 persons are presently working and in tufanialonga tea estate 212 persons are working. it has further been stated in the said affidavit of the under secretary to the government of tripura. department of industries and commerce that after the laxmilonga tea estate was taken over in 1986 under the impugned act by the state government production of tea has increased from 1,15,449 kg to 4,20,566 kg. and after the tufanialonga tea estate was taken over in the year 1986 under the impugned act by the state government the production of tea has increased from 60,705 kg to 2,89,567 kg. though the figures of the total number of employees presently working in the two tea estates and the figures of production have not been admitted in the affidavit of the constituted attorney and director of the two petitioner companies filed on 16-2-1997, it is not disputed that the tripura tea development corporation limited is presently rnanaging these two tea estates and that there is production of tea in the two tea units and that number of employees arc engaged in the two tea estates. the court is unable to knowfrom the said affidavit of the constituted attorney and director of the two petitioner companies as to whether the two petitioner companies are in a position to run the two tea units and continue in employment the employees presently engaged in the two tea units and continue production of reasonable quantity of tea. this is a fit case, therefore, in which we should not direct restoration of the two tea estates to the petitioner companies immediately until the petitioner companies satisfy the state government that they arc in a position to run the two tea estates either on their own or through a scheme negotiated with the tripura tea development corporation limited or some olhcr organisation on mutually acceptable terms and conditions.31. in the result, while upholding the validity of the impugned act and the impugned ordinance, we set aside the sales and confirmation of sales of the two tea estates to the state government and remit trie matter back to the revenue court for taking fresh steps in accordance with the 1960 act and the 1961 rules as discussed in this judgment. after the petitioner companies arc served with the written notices of demand of arrear land revenue they may raise their contentions on the merits of the demand before the revenue court which will decide the same in accordance with the 1960 act and the 1961 rules. we further direct that the state government will within six months from today specify the rate payable every year to the petitioner companies under section 5 of the impugned act and pay tile amount determined on the basis of such rate specified by the state government to the petitioner companies for the period from 13-11-1986 to 4-6-1987. we also direct that the state government will within six months from today also determine the compensation that will be payable to the petitioner companies for the period from 4-6-1987 onwards till the date of this judgment in accordance with this judgment and pay the same to the petitioner companies within six months from today. since the petitioner companies have not been paid any amount as yet, we direct that pending determination of the amount and compensation by the state government the petitioner companies will be paid rs. 10 lakhs for each of the tea estates within two months from today and the aforesaid amount of rs. 20.00 lakhs (rs. 10.00 lakhs + rs. 10.00 lakhs) will be adjusted towards the amount and compensation to be paid by the state government. we make it clear that the two tea estates may not be restored to the petitioner companies until they satisfy the state government that the two tea units will be run either by the petitioner companies or through a scheme negotiated with the tripura tea development corporation limited or some other organisation on mutually acceptable terms and conditions and the compensation at rates determined by the state government will be paid to the petitioner companies till possession is restored to the petitioner companies once every six months. in case any amount or compensation is not paid within the time stipulated in this judgment, the petitioner companies will be entitled to interest at the rate of 18% per annum on the amount or compensation that is over due. liberty is also given to the parties to apply to this court in case of any difficulty arising out of implementation of aforesaid directions or any difficulty with regard to the determination of the amount or compensation. with the aforesaid directions, the writ petition stands disposed of. considering, however, the facts and circumstances of the case., the parties shall bear their own costs.

Judgment:

Patnaik, J.

1. In this application under Article 226 of the Constitution of India, the petitioners have prayed for declaring the Tripura Tea Companies (Taking Over of Certain Tea Units) Ordinance 1986 and the Tripura Tea Companies (Taking Over of Management of Certain Tea Units) Act, 1987, as ultra vires the Constitution and for quashing the notification and orders issued thereunder as well as the Certificate Proceedings leading to the sale of the tea estates belonging to the petitioners in course qf the said Certificate Proceedings and for a direction on the respondents to pay proper compensation with interest at 18% per annum for the damages suffered by the petitioners on account of the take over of the lea estates of the petitioners.

2. The relevant facts briefly are that the petitioner No. 1 is a limited company registered under the Indian Companies Act, 1913 and was the owner of the Tufanialonga Tea Easte located at Tebaria. The petitioner No. 2 is also a limited company registered under the Indian Companies Act, 1913 and was the owner of the Laxmilonga Tea Estate located at Tebaria, Tripura West. The petitioner No. 3 is a Director of the petitioner Nos. 1 and 2 Companies. The petitioner's have been carrying on the business of producing and manufacturing of tea in the said tea estates since 1918-19. On 13-11-86, the Tripura Tea Companies (Taking Over of Management of Certain Tea Units) Ordinance, 1986, was promulgated by the Governor of Tripura. By the said Ordinance, with effect from the date of promulgation of the Ordinance, the management of the Tea Companies in relation to tea units mentioned in the schedule to the Ordinance vested in the State of Tripura for a period of 5 years. The Tufanialonga and the Laxmilonga tea estates were included in the said schedule to the Ordinance. In exercise of powers conferred by Sub-section (1) of Section 4 of the said Ordinance, the State Government appointed the Tripura Tea Estates Development Corporation Limited as the custodian of the aforesaid two tea estates. The Managing Director of the Tripura Tea Estates Development Corporation Limited sent notices dated 13-11-86 to the petitioner Nos. 1 and 2 to furnish to him the inventories and agreements in relation to the two tea units and to deliver to him all books, papers and other documents relating to the two tea units. On 13-11-86, the Managing Director of Tripura Tea Estates Development Corporation Limited also issued notifications appointing Shri Dilip Kumar Das, Labour Inspector, Government of Tripura as the custodian of the Tufanialonga tea estate and Shri Ratan Chakravorty, Labour Inspector, Government of Tripura, as custodian of the Laxmilonga tea estate. By the two notifications dated 13-11-86, Shri Dilip Kumar Das and Shri Ratan Chakravorty were authorised to take over charge of the management of the respective tea units. Two notices dated 13-11-86 were also issued by the Managing Director of Tripura Tea Estate Development Corporation Limited to the petitioner Nos. 1 and 2 to deliver to the said Shri Dilip Kumar Das and Shri Ratan Chakravorty all the properties in possession, custody and control of the petitioner Nos. 1 and 2. The Ordinance was substituted by the Tripura Tea Companies (Taking Over of Management of Certain Tea Units) Act, 1986, which received assent of the President of India on 29-1-87. After the expiry of the period of 5 years, the period for management of the undertakings of the tea companies in relation to

the tea units by the State Government was extended for one year with effect from 11 -11-91 by notification dated 9-4-91 of the State Government. Thereafter, the said period was again extended by notification dated 14-10-92 of the State Government for one year with effect from 11-11-92. Jn the meanwhile, Certificate Proceedings were initiated against the petitioners Nos. 1 and 2 for non-payment of land revenue amounting to Rs. 4147.34 and Rs. 6639.92 respectively and the tea estates of the petitioners Nos. 1 and 2 were sold in auction on 4-6-87 at a token price of Re. 1/- for each tea estate in course of the said Certificate Proceedings and the said sales were confirmed on 27-7-87. The petitioners have challenged the said Ordinance and the Act and the said sales of their tea estates in the Certificate Proceedings in the present writ petition.

3. Mr. G.C. Chakravorty, learned counsel appearing for the petitioners, submitted that the impugned Ordinance and the impugned Act are beyond the legislative competence of the Governor and the State Legislature of Tripura and are, therefore, unconstitutional and void. He contended that under Article 246(1) of the Constitution, Parliament has exclusive powers to make law with respect to any of the matters enumerated in List I of the 7th Schedule of the Constitution and Entry 52 of the said List I related to 'industries the control of which by the Union is declared by Parliament by law to be expedient in the public interest'. In exercise of its powers under Article 246(1) of the Constitution read with Entry 52 of the List I of the 7th Schedule of the Constitution. Parliament has declared in Section 2 of the Tea Act, 1953 that it is expedient in the public interest that the Union should take under ' its control the tea industry and has made elaborate provisions relating to the tea industry in the said Act. Mr. Chakravorty referred to the provisions of Chapter III A of the Tea Act, 1953 to show that elaborate provisions have been made therein for management and control of tea undertakings or tea units by the Central Government in certain circumstances. He submitted that it will be clear from the express language used in Entry 24 of List II of the 7th Schedule read with Article 246 (2) of the Constitution that the power of the State Legislature to make law relating to industry is subject to the provisions of Entry 52 of the List I of the 7th Schedule of the Constitution. He explained that as Parliament has made the Tea Act, 1953, under Entry 52 of List I of the 7th Schedule of the Constitution which includes, inter alia, provisions with regard to take over of the management and control of tea undertakings or tea units by the Central Government in certain circumstances, the State Legislature cannot make any law on the very same subject. The impugned Act was, therefore, beyond the competence of the State Legislature. Mr. Chakravorty submitted that since the power of the Governor to make an Ordinance under Article 213 of the Constitution is co-extensive with the power of the State Legislature to make law, the impugned Ordinance was also beyond the competence of the Governor. Mr. Chakravorty pointed out that the impugned Act received the assent of the President but such assent cannot validate an Act made by the Legislature of State on a matter covered under the entries in List I of the 7th Schedule of the Constitution. The assent of the President may be of relevance only if the Act has been made by the State Legislature on a matter enumerated in List III (Concurrent List) as would be clear from Article 254 (2) of the Constitution. Alternatively, Mr. Chakravorty submitted that the impugned Ordinance and the impugned Act are hit by the provisions of Sections 16A to 16N of Chapter III A of the Tea Act, 1953, inasmuch as, the impugned Ordinance and'the Act make provisions for take over of the management of the tea companies by the State Government, although elaborate provisions have been made in the said Sections 16A to 16N of Chapter IIIA of the Tea Act, 1953 for the control of the tea estates and tea units including the take over of the management of the tea estates and tea units in certain circumstances by the Central Government. In support of these submissions, Mr. Chakravorty cited the decisions of the Supreme Court in Hingir-Rampur Coal Co. v. State of Orissa, AIR 1961 SC 459, State of Orissa v. M.A. Tullock & Co., AIR 1964 SC 1284 and lTC Ltd. v. State of Karnataka, 1985 (Supp) SCC 476.

4. Mr. B. R. Bhattacharjee, learned Advocate General, Tripura, on the other hand, submitted that under Entry 24 of the List II of the 7th Schedule of the Constitution, the State Legislature has the power to make law relating to industry and in Ishwari Khetan Sugar Mills v. State of U. P., AIR 1980 SC 1955, the Supreme Court held that when Parliament by law declares that the control of a particular industry by the Union is expedient in the public interest, the power of the State Legislature to make law relating to such industry still remains and is only taken away to the extent Parliament makes provisions in the law enacted by it. According to Mr. Bhattacharjee, therefore, even though Parliament has made the Tea Act, 1953, the State Legislature still can make law relating to tea industry in exercise of its powers under Article 246 (2) read with Entry 24 of the 7th Schedule of the Constitution, the only limitation to its power being that it cannot enact a provision which is in direct conflict with the provisions of the Tea Act, 1953. Mr. Bhattacharjee argued that in Sections 16 A to 16 N in Chapter III A of the Tea Act, 1953, there is no provision prohibiting the take over of the management of tea units by the State Government and, therefore, the impugned Ordinance and the impugned Act providing fof take over of the management of certain tea units by the State Government do not in any manner conflict with the said provisions of the Tea Act, 1953 and are within the competence of the Governor and the State Legislature. He further pointed out that a reading of the statement of objects and reasons of the Tea Act, 1953 would show that the object of the Tea Act, 1953 is to control the export of tea. The object of the impugned Ordinance and impugned Act, on the other hand, is to augment the production of tea or to prevent the fall in the production of tea in the State. The objects of the Tea Act, 1953 and the impugned Ordinance and the impugned Act are different and it cannot be held that they cover the same field. Alternatively, Mr. Bhattacherjee contended that under Entry 33 of the List III (Concurrent List) of the 7th Schedule read with Article 246 (2) of the Constitution, the State Legislature has concurrent power with Parliament to make law relating to production of the product of any industry where the control of such industry by the Union has been declared by the Parliament by law to be expedient in the public interest. According to Mr. Bhattacharjee, since the object of the impugned Ordinance and the impugned Act is to augment the production of tea or to prevent the volume of production in the State they are covered under the said Entry 33 of the List III of the 7th Schedule of the Constitution and are within the powers of the State Legisla ture. In reply to the submission of Mr. Chakravorty that the impugned Ordinance and the impugned Act are hit by the provisions of Sections 16A to 16N of the Tea Act, 1953, Mr. Bhattacharjee submitted that there is no such repugnancy between the State law and the Central law and that both the State law and the Central law can operate together and cited the decision of the Supreme Court in Bihar Distillery v. Union of India, AIR 1997 SC 1208 to show how the State and the Union both have their respective control over the same subject matter within their demarcated areas. Alternatively, he submitted that once the impugned Act received the assent of the President, it prevailed over the provisions of Sections 16 A to 16 N of the Tea Act, 1953, as has been provided in Article 254(2) of the Constitution and for this submission relied on the decision of the Supreme Court in Thirumuruga Kirupananda Variyar Thavathiru Sundara Swamigal Medical Education & Charitable Trust v. State of Tamil Nadu, (1996) 3 SCC 15 ; (AIR 1996 SC 2384).

5. Article 246 and Entry 52 of List I; Entries 24 and 27 of the List II and Entry 33 of the List III of the 7th Schedule of the Constitution are extracted hereinbelow.

'246. Subject-matter of laws made by Parliament and by the Legislature of States.--

(1) Notwithstanding anything in Clauses (2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List I in the Seventh Schedule (in this Constitution referred to as the 'Union List').

(2) Notwithstanding anything in Clause (3), Parliament, and, subject to Clause (1) the Legislature of any State also, have power to make laws with respect to any of the matters enumerated in List III in the Seventh Schedule (in this Constitution referred to as the 'Concurrent List').

(3) Subject to Clauses (1) and (2), the Legislature of any State has exclusive power to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the Seventh Schedule (in this Constitution referred to as the 'State List').

(4) Parliament has power to make laws with respect to any matter for any part of the Territory of India not included (in a State) notwithstanding that such matter is a matter enumerated in the State List.'

'SEVENTH SCHEDULE .

(Article 246)

List I - Union List

52. Industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest.

List II -- State List

24. Industries subject to the provisions of (entries 7 and 52) of List I.

27. Production, supply and distribution of goods subject to the provisions of Entry 33 of List III.

List III -- Concurrent List

33. Trade and commerce in, and the production, supply and distribution of,--

(a) the products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in the public interest, and imported goods of the same kind as much products;

(b) foodstuffs, including edible oilseeds and oils;

(c) cattle fodder, including oilcakes and other concentrates;

(d) raw cotton, whether ginned or unginned, and cotton seed; and

(e) raw jute.'

Under Article 246(1) of the Constitution quoted above, Parliament has exclusive power to make law with respect to any of the matters enumerated in List I of the 7th Schedule of the Constitution. Under Entry 52 of the List I, therefore, the Parliament has power to make law relating to industries the control of which by the Union is declared by Parliament by law to be expedient in the public interest. Under Article 246(3) of the Constitution, the Legislature of any State has exclusive powers to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the 7th Schedule of the Constitution. In Entry 24 of the List II, the Legislature of a State has power to make laws on industries subject to the provisions of Entries 7 and 52 of the List 1 Under Entry 27 of List II read with Article 246(3) of the Constitution, moreover, the Legislature of a State has the power to make law relating to production, supply and distribution of goods subject to the provisions of Entry 33 of List III of the 7th Schedule of the Constitution. Under Article 246(2) of the Constitution, both Parliament and the Legislature of a State have the power to make laws with respect to any of the matters enumerated in List III of the 7th Schedule of the Constitution. Under Entry 33 of the List III read with said Article 246(2) of the Constitution, therefore, both Parliament and the Legislature of State have powers to make law relating to trade, commerce, production, supply and distribution of products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in the public interest. Thus where as State Legislature has exclusive powers under Article 246(3) read with Entry 27 of the List II of the 7th Schedule of the Constitution to make law relating to production, supply and distribution of goods, both Parliament and the Legislature of a State have concurrent powers under Entry 33 read with Article 246(2) of the Constitution to make law relating to the production, supply and distribution of the products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in the public interest. It is pertinent to note that nonq of the entries in List I, List II or List III of the 7th Schedule of the Constitution mention take over of the management of an industry by the Government as a separate subject of legislation. Hence the power to legislate for taking over of the management of an industry has to be located in the aforesaid Entry 52 of List I, Entries 24 and 27 of List II and Entry 33 of List III of the Constitution.

6. To find out the entries in Lists I, II and III on which the Tea Act, 1953 and the impugned Act and the impugned Ordinance have been made, we may now examine the provisions of the Tea Act, 1953 and of the impugned Ordinance and the impugned Act. The long title of the Tea Act, 1953 states that it was an Act to provide control by the Union on the Tea industry, including control, in pursuance of international agreement now in force, of the cultivation of tea in and of export of tea from India and for that purpose to establish a Tea Board and levy a duty of excise on tea produced in India. Section 2 of the Act declares that it is expedient in the public interest that the Union should take under its control the tea industry. Sections 4 to 11 in Chapter II of the Act provide for constitution of the Tea Board, its function and its dissolution. Sections 12 to 16 in Chapter III of the Act relates to control over the extension of tea cultivation. Sections 17 to 24 in Chapter IV of the Act contain different provisions relating to control over the tea and tea seed. Sections 25 to 29 in Chapter V of the Act relate to finance, accounts and audit and provide for imposition of cess on tea, payment of proceeds of the cess to the Board, constitution of Tea Fund, etc., Chapter VI of the Act contains various provisions relating to control by the Central Government of price and distribution of tea and tea waste (Section 30), general control over acts and proceedings of the Board (Section 31) and appeal to Central Government against the orders of the Board (Section 32). Chapter VII of the Act contains various miscellaneous provisions in Sections 33 to 51 and provides for licencing of brokers, tea manufacturers, inspection of tea estates or places where tea and tea waste are stored or exposed for sale, calling of returns relating to production, sale, export of tea produce at a tea estate or any other matter, penalties for various offences, jurisdiction of Courts, previous sanction of the Central Government for prosecution, power to make rules, repeal and savings. The aforesaid provisions of the Tea Act, 1953 show that the said Act was made by Parliament on Tea industry in exercise of its powers under Entry 52 of List I of the 7th Schedule of the Constitution.

7. By the Tea (Amendment) Act, 1976, Chapter III A was introduced into the Tea Act, 1953 and Sections 16 A to 16 N made various provisions relating to management or control of tea undertakings or tea units by the Central Government in certain circumstances. Section 16A contains definitions for the purpose of the said Chapter III A. Section 16B empowers the Central Government to cause investigation to be made in relation to a tea undertaking or tea unit under certain circumstances. Section 16C provides that on completion of investigation, the Central Government has power to issue directions to the tea undertakings or tea units concerned for the purpose of regulating or stimulating the production and for the purpose of controlling the price and distribution of tea. Section 16D, on the other hand, empowers the Central Government to assume the management or con trol of tea undertakings or tea units in certain cases including cases where average yield of tea undertakings or tea units for three years is lower than the district average yield by twenty-five percent or more. Similarly Section 16E confers power on the Central Government to takeover tea undertakings or tea units without investigation under certain circumstances including cases where production of tea manufactured or produced by the tea undertakings or tea units had been affected by various acts of persons incharge of the tea undertakings or tea units. Sections 16 F to 16 L make provisions which are supplemental or consequential to the takeover of management of the tea undertakings or tea units by the Central Government under Sections 16 D and 16 E of the Act. Section 16H in particular provides that if at any time it appears to the Central Government that the purpose of the order made under Section 16 D or 16 E has been fulfilled or that for any other purpose it is not necessary that order should remain in force, the Central Government may cancel such order and on cancellation, of such order, the management or control, as the case may be, of the tea undertakings or tea units shall vest in the owner of that undertaking or unit. These provisions in Sections 16 A to 16 N in Chapter III A of the Tea Act, 1953, are therefore provisions made by the Parliament in exercise of its powers under Entry 52 of List I as well -as its powers under Entry 33 of List III of the 7th Schedule of the Constitution which confer concurrent power in Parliament and the Legislature of a State to make law relating to production; supply and distribution of the products of any industry where the control of such industry by the Union is declared by Parliament by law to be expedient in public interest.

8. Coming now to the impugned Ordinance and the impugned Act, it is not necessary to deal with the provisions of the impugned Ordinance as they have been incorporated in the impugned Act. The long title of the impugned Act states that it was an Act to provide for takeover of management of certain tea units specified in the Schedule 'with a view to securing proper reorganisation and management of such tea units so as to subserve the interest of the general public by augmenting the production and manufacture of tea varieties which are essential to the needs Of the economy of the State and for matters connected therewith and incidental thereto'. Section 3 of the impugned Act provides for takeover of the management of the undertakings of tea companies in relation to tea units. Sub-section (1) of Section 3 stipulates that on and from the appointed day, the management of the undertakings of the tea companies in relation to the tea units shall vest in the State Government for a period of five years. Proviso to Sub-section (1) of Section 3, however, enables the State Government to extend the said period of five years by further period not exceed-ipg one year subject to total, of two years after the expiry of five years as aforesaid. Sub-sections (2) tp (8) of Section 3 make various supplemental and consequential provisions relating to such takeover of the management of the undertakings of the tea companies by the State Government. Sub-section (1) of Section 4 states that the State Government may appoint any person, co-operative society or body of persons as the custodian of one or more of the tea units for the purpose of carrying on the management of such tea units and the custodian so appointed shall carry on the management of the tea units for and on behalf of the State Government. Sub-sections (2) to (9) of Section 4 make provisions with regard to the manner in which the custodian so appointed by the State Government will takeover possession of the assets of the company and carry on management of the tea units for and on behalf of the State Government. Section 5 provides for the payment of amount by the State Government to the tea company the management of which has been taken over under the Act by the State Government. Section 6 confers power on the State Government to make certain declarations in relation to certain tea units. Sub-section (1) of Section 6 is quoted herein below. -

'(1) The State Government may, if satisfied, in relation to any tea unit or any part thereof, the management of which has vested in it by the Act that it is necessary so to do in the interest of the general public, with a view to preventing any fall in the volume of production of tea by such tea units, by notification declare that the operation of all or any of the contracts, assurances of property, agreements, settlements, awards, standing order or other instruments in force (to which such tea units or the tea Company owning such tea unit is a party or which may be applicable to such tea unit) immediately before the date of issue of the notification shall remain suspended or that all or any of the rights, privileges, obligations and liabilities accruing or arising there under before the said date, shall remain suspended or shall be enforceable with such adaptation and in such manner as may be specified in the notification.

Explanation -- For the purpose of this subsection 'award' shall not include an industrial award.'

The aforesaid Sub-section (1) of Section 6 showsthat the State Government could suspend thelegal obligations of a Tea Company the management of which has been taken over by the StateGovernment under the impugned Act with a viewto prevent any fall in the volume of production oftea by a tea unit. Sections 7 to 15 contain someMiscellaneous provisions such as the overridingeffect of the impugned Act (Section 7), the application of Companies Act, 1956, (Section 8),exclusion of period of operation of the impugnedAct from limitations (Section 9), protection of anaction taken on good faith (Section 10), power toterminate contract of employers (Section 11),penalties (Section 12), offence by Companies(Section 13), power to make rules (Section 14)and repeal and savings (Section 15). It is thusclear that the impugned Act has been made forthe purpose of augmenting production of tea bythe tea units by vesting the management of the teaunits in the State Government for a period of fiveto seven years and by empowering the StateGovernment to suspend contracts, assurances ofproperties, agreements, settlements, awards,standing orders or other instruments with a viewto prevent any fall in the volume of tea by the teaunits. The impugned Ordinance and the impugnedAct are thus in pith and substance law relating toproduction of tea in the State of Tripura and hasbeen made by the Governor and the State Legislature in exercise of powers under Entry 33 ofList III read with Article 246(2) of the Constitution.

9. Mr. Chakravorty, learned counsel for the petitioner, however, vehemently submitted that Entry 33 of the List III of the 7th Schedule of the Constitution relates to production, supply and distribution of products of an industry the control of which by the Union is declared by Parliament by law to be expedient in the public interest and does not cover the production, supply and distribution of the raw materials of such Industry. In support of this submission, he cited the decision of the Supreme Court in the case of Tikaramji v. State of UP., AIR 1956 SC 676. He argued that under the impugned Ordinance and the impugned Act, not only the management of the tea factory of the tea units but also the management of the tea garden of the tea units had been taken over by the State Government. According to him, since the production of tea in the tea garden means production of the raw material for the tea industry and does not mean the production of the product of the tea industry, the impugned Ordinance and the impugned Act does not fall under Entry 33 of the List III of the 7th Schedule of the Constitution. Even if the production of tea as raw material is not covered under Entry 33 of the List III of the 7th Schedule of the Constitution, such production of tea as raw material would be covered by Entry 27 of List II of the 7th Schedule of the Constitution. Under the said Entry 27 of the List II of the 7th Schedule of the Constitution read with Article 246(3) of the Constitution it is the State Legislature which has the power to make law relating to production, supply and distribution of goods which would include also raw materials as per the decision of the Supreme Court in the case of Tikaramji v. State of U.P. (supra) cited by Mr. Chakravorty. In our considered opinion, therefore, the impugned Ordinance and the impugned Act have been made in exercise of the powers of the Governor and the State Legislature to make law under Entry 27 of List II and Entry 33 of List III of the 7th Schedule of the Constitution.

10. It is true that the impugned Ordinance and the impugned Act have effect on the tea industry in the State and therefore encroached upon the Entry 24 of the List II which was subject to, Entry 52 of List I of the 7th Schedule of the Constitution but it does not contain provisions to control or regulate the tea industry as such and therefore is not a legislation on tea industry. It has been held by the Supreme Court in Kannan Devan Hills Produce Company Ltd. v. The State of Kerala, AIR 1972 SC 2301.

'Effect is not the same thing as subject-matter. If the State Act, otherwise, valid, has effect on a matter in List I it does not cease to be a legislation with respect to an entry in List II or List III.'

Similarly, in the case of Ishwari Khetan Sugar Mills v. State of U.P., AIR 1980 SC 1955, the Supreme Court held:

'When validity of a legislation is challenged on the ground of want of legislative competence and it becomes necessary to ascertain to which entry in the three lists the legislation is referable to, the Court has evolved the theory of pith and substance. If in pith and substance a legislation falls within one entry or the other but some portion of the subject-matter of the legislation incidentally trenches upon and might enter a field under another List, the Act as a whole would be valid notwithstanding such incidental trenching. This is well established by a catena of decisions (see Union bT India v. H. S. Dhillon, (1972) 2 SCR 33 : AIR 1972 SC 1061 and Kerala State Electricity Board v. Indian Aluminium Co. Ltd., (1976) 1 SCR 552 : AIR 1976 SC 1031. After referring to these decisions in State of Karnataka v. Ranganatha Reddy, (1978) 1 SCR 641: AIR 1978 SC215 Untwalia, J, speaking for the Constitution Bench has in terms stated that the pith and substance of the Act has to be looked 'into and an incidental trespass would not invalidate the law.'

Since the impugned Ordinance and the impugned Act are in pith and substance law relating to production of tea falling under Entry 33 of List III of the 7th Schedule of the Constitution and Entry 27 of List II of the 7th Schedule of the Constitution in respect of which the State Legislature has power under Articles 246(2) and 246(3) of the Constitution, the fact that it is also a legislation affecting the tea industry in the State of Tripura and incidentally trespass into the field covered under Entry 52 of List I of the 7th Schedule of the Constitution reserved to the Parliament will not invalidate the said Ordinance and the Act.

11. In Hingir Coal Co. v. State of Orissa, (AIR 1961 SC 459) (supra) cited by Mr. Chakravorty, the validity of Orissa Mining Areas Development Fund Act, 1952 was challenged on the ground that the power of the State Legislature under Entry 23 of List II of the 7th Schedule of the Constitution to make law relating to regulation of mines and mineral development was subject to provisions of Entry 54 of the List I which empowered the Parliament to make law relating to regulation of mines and mineral development to the extent to which such regulation and development under the control of Union is declared by

law to be expedient in the public interest. The Supreme Court held that the jurisdiction of the State Legislature to make law relating to regulation of mines and minerals development would be excluded if Parliament by its law declared that regulation and development of mines should in the public interest be under the control of Union, but since the Court found that no such declaration had been made by the Parliament after commencement of the Constitution, the Supreme Court upheld the constitutional validity of the said Orissa Act. In the State of Orissa v. M. A. Tullock, (AIR 1964 SC 1284) (supra) cited by Mr. Chakravorty, however, the Supreme Court found that Parliament had enacted the Mines and Minerals Regulation and Development Act, 1957, under Entry 54 of List I of the 7th Schedule of the Constitution and the Supreme Court held that since the said Act contained the requisite declaration by the Union Parliament under Entry 54, the entire field of mineral development on which the said Central Act had been enacted was excluded from the power of the State Legislature under Entry 23 of List II of the 7th Schedule of the Constitution. In ITC v. State of Karnataka (1985 (Supp) SCC 476) (supra) on which great reliance was placed by Mr. Chakravorty, Fazal Ali, J., held that once the Parliament takes over an industry under Entry 52 of List I and passes an Act to regulate the industry, the State Legislature ceases to have the power to legislate in the field and if it does so, the State legislation would be ultra vires. In that case, the Supreme Court struck down the Karnataka Agricultural Produce Marketing (Regulation) Act, 1966, in so far as it levied market fee in respect of tobacco because the said provision for levying market fee directly collided with the Tobacco Board Act, 1975, enacted by the Parliament under Entry 12 of List I of the 7th Schedule of the Constitution. In the said case, Fazal Ali, J, further observed that if the. President's assent would have been taken it would not validate the said Karnataka Act so far as tobacco industry is concerned because Article 254 (2) applies only to matter only in the Concurrent List and had nothing to do with the matters in Lists I and II. These decisions of the Supreme Court cited by Mr. Chakravorty are of no assistance to him, because we have held that the impugned Ordinance and the impugned Act are not in pith and substance law relating to tea industry under Entry 24 of List II which was subject to Entry 52 of List I of the 7th Schedule of the Constitution but are in pith and substance legislations on Entry 27 of List II and Entry 33 of List III of the 7th Schedule of the Constitution in respect of which the State Legislature has power to make law.

12. This takes us to the contention of Mr. Chakravorty, learned counsel for the petitioner, that the provisions of the impugned Act and the impugned Ordinance are hit by Sections 16 A to 16 N of the Tea Act, 1953. Mr. Chakravorty, in particular, referred to the provisions of Sections 16D and 16 E of the Tea Act, 1953, under which the Central Government can take over the management of the whole or any part of the tea undertakings or tea units under certain circumstances . This contention of Mr. Chakravorty overlooks the provisions of Sub-section (3) of Section 8 of the impugned Act which is to the following effect:

'8. (3) The provisions of this Act shall not be in derogation to the provisions of the Tea Act, 1953 or any other Central law relating to Tea industry and nothing contained in this Act shall exempt any person or body of person, who may, for the time being, be entrusted with the management of a Tea Unit under this Act from the operation of the provisions of any such Central Law.'

Hence, the impugned Act itself states that its provisions will not be in derogation of the provisions of the Tea Act, 1953. Regarding the power of the Central Government under the Tea Act, 1953 to take over the management of tea units, no order as such has been passed by the Central Government either under Section 16D or Section 16E of the Tea Act, 1953 taking over the management of whole or any part of tea under-takings and tea units in the State of Tripura. In the absence of such an order made by the Central Government under Section 16D or 16E of the Tea Act, 1953, there is no case of repugnancy between the provisions of the Tea Act, 1953 and the impugned Ordinance and the impugned Act. This is because repugnancy must exist in fact and not depend on a possibility of an order being passed by the Central Government under Section 16D or Section 16E of the Tea Act, 1953. Ashas been held by the Supreme Court in, Tikaramji v. State of U.P. (AIR 1956 SC 676) (supra):

'Even assuming that sugarcane was an article or class of articles relatable to the sugar industry within the meaning of Section 18-G of Act 65 of 1951 it is to be noted that no order was issued by the Ceritral Government in exercise of the powers vested in it under that section and no question of repugnancy could ever arise because, as has been noted above, repugnancy must exist in fact and not depend merely on a possibility. The possibility of an order under Section 18-G being issued by the Central Government would not be enough. The existence of such an order would be the essential perquisite before any repugnancy could ever arise.'

13. At any rate, the impugned Act has received the assent of the President and the consequence of such assent of the President to an Act made by the Legislature has been provided in Article 254 of the Constitution. Article 254 is quoted hereinbelow;

'254. Inconsistency between laws made by Parliament and laws made by the Legislature of States.-- (1) Ifany provision of a law made by the Legislature of a State is repugnant to any provisions of a law made by Parliament which Parliament is competent to enact, or to any provision of an existing law with respect to one of the matters enumerated in the concurrent List, then, subject to the provisions of Clause (2), the law made by Parliament, whether passed before or after the law made by the Legislature of such State, or, as the case may be the existing law, shall prevail and the law made by the Legislature of the State shall, to the extent of the repugnancy, be void.

(2) Where a law made by the Legislature of a State with respect to one of the matters enumerated in the Concurrent List contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the Legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in the State.

Provided that nothing in this clause shall prevent Parliament from enacting at any time any law with respect to the same matter including a law adding to, amending, varying or repealing the law so made by the Legislature of the State.'

A reading of Clause (2) of Article 254 of the Constitution would show that where a Legislature of a State makes a law in respect to the matter enumerated in concurrent List and such law contains any provision repugnant to the provisions of a law earlier made by the Parliament, then the law so made by the Legislature of a State, if it has been reserved for the consideration of the President and has received its assent shall prevail in the State. Since, we have already held that the impugned Act in so far as it provides for takeover of the management of the tea units mentioned in the schedule to the Act for the purpose of augmenting the production of tea as a final product has been made in respect to a matter in Entry 33 of Concurrent List and has received the assent of the President, the provisions of the impugned Act even if held to cover the same field as Sections 16D and 16E of the Tea Act, 1953 cannot be struck down on the ground that it is repugnant to the said provisions of the Tea Act, 1953. Further, the impugned Act in so far it also empowers the State Government to takeover the management of the tea gardens of tea units is a legislation in respect of matter under Entry 27 of List II of the 7th Schedule of the Constitution on production of tea as a raw material and is within the exclusive powers of the State Legislature and cannot be struck down on the ground that it is repugnant to the provisions in Sections 16D and 16E of the Tea Act, 1953. The contention of Mr. Chakravorty, therefore, that the impugned Ordinance and the impugned Act are ultra vires the Constitution and the Tea Act, 1953 fails, '

14. It was next contended by Mr. Chakravorty that the sale of the two tea estates belonging to the petitioner companies for recovery of land revenue was fraudulent, illegal, invalid, ultra vires and contrary to the procedure established by law. He argued that under Section 22 of the Tripura Land-Revenue and Land Reforms Act, 1960, (for short 'the 1960 Act') the owner of the tea estate was liable to pay land revenue in respect of the land comprising the tea estates.-Hence notices in case default in payment of land revenue have to be served on the owners of the tea estates as required by Section 62 of the 1960 Act. Since the management and possession of the tea estates was with the State Government under the impugned Ordinance and the impugned Act with effect from November, 1986, in case there was defaultin payment of landrevenue, notices should have been served on the petitioner companies at Calcutta as they were the owners of the land and were liable to pay land revenue under the aforesaid Act. But no such notices were served on the two petitioner companies at Calcutta and instead notices for default in payment of land revenue totalling to Rs. 10,776.26 for the period from 14-4-1986 to 13-4-1987 and 14-4-1987 to 13-4-1988 were served on the two tea estates under the management and possession of the State Government. Mr. Chakravorty submitted that the affida-vit-in-opposition of the State respondents would show that all notices as prescribed by the Tripura Land Revenue and Land Reforms Rules, 1961, (for short 'the 1961 Rules') in Forms 24,25 and 27 and the proclamation in Form 28 were not served on the petitioner companies at Calcutta who were owners'of the land comprising the tea estates and instead were purportedly served at the tea estates which were under the management and possession of the State Government. He vehemently contended that the value of the Tufanialonga Tea Estate was Rs. 1.06 Crores and the value of Laxmilonga Tea Estate was Rs. 85.00 Lakhs as per the estimate made in the affidavit-in-opposition filed by the respondents and yet the two tea estates were sold at a nominal price of Re. 1/- each to the State Government without proclamation of sale being published in any newspaper having wide circulation as per Rules 99(2) and 99(3) of the 1961 Rules. He 'pointed out that the affidavit-in-opposition filed by the State respondents would further show that there was stock of tea lying in the factories of the two tea estates when they were taken over by the State Government in the year 1986 and the said stock of tea were sold at a total sum of Rs. 46,911.44 and the aforesaid amount of sale proceeds of tea was sufficient to pay off the arrear land revenue of Rs. 10,776.26 and there was absolutely no necessity of selling the two tea estates for recovery of the arrear land revenue. He pointed out that the petitioners filed an application for setting aside the sale before the District Collector under Rule 73(a)of the 1961 Rules and the District Collector in his order dated 30-11-1992 observed that notices were not properly served on the owners of the tea estates at Calcutta before the sale was made, the sale of the two tea estates was disproportionate to the arrear of land revenue and was contrary to Section 70 of the 1960 Act and that the owner companies should have been given a chance of payment of liability of revenue. But the District Collector refused to set aside the sale on the ground that the application for setting aside the sale ,was filed well beyond the period of limitation. Mr. Chakravorty explained that the delay in filing the application before the District Collector for setting aside the sale was on account of the fact that certified copies of the relevant orders in the Certificate Proceedings leading to the sale of the two tea estates though applied for on 23-12-1991 were not furnished to the petitioners at all. He cited the decision in Nani Gopal Paul v. T. Prasad Singh, AIR 1995 SC 1971, in which the Supreme Court held that the Court would not remain mute spectator to obvious manifest illegality committed in conducting the Court sales even if application for setting aside of the 'safe was not filed in time. He ajso relied on the decision of the Full Bench of the Calcutta High Court in Purna Chandra Chatterjee v. Dinabandhu Chatterjee, (1907) ILR 34 Cal 811, in which a sale of property without service of notice under Section 10 of the Public Demands Recovery Act was held to be without authority and a nullity. He contended that since in the present case the sale of the two tea estates at a nominal price of Re. 1/- per tea estates was fraudulent, illegal and in gross violation of the provisions of the 1960 Act and the 1961 Rules, the sale was liable to be set aside by this Court. In this context, he stated that other tea estates which had been similarly sold for recovery of land revenue to the State Government at a nominal price have been restored to the respective owners by order of the Tribunal before whom the sale of the tea estates were challenged.

15. Mr. B.K. Das, learned counsel appearing for the respondent No. 6 United Bank of India supported the said contentions of Mr. Chakravorty and submitted that the respondent No. 6 had advanced a loan of Rs. 20.00 Lakhs to the petitioner companies and the properties of the petitioner companies had been furnished as equitable mortgage for the aforesaid loan. Mr. Das pointed out that the said loan of Rs. 20.00 Lakhs had accumulated with interest to Rs. 1.20 Crores as stated-in the affidavit-in-opposition filed by the respondent No. 6 and that the sale of the two tea estates to the State Government at the nominal price of Re 1/- had deprived the respondent No. 6 of its security against the said dues of Rs. 1.20 Crores.

16. Mr. Bhattacharjee, learned Advocate General, Tripura on the other hand, submitted that the sale of the two tea estates have been made in accordance with the provisions of the 1960 Act and the 1961 Rules. He submitted that under Section 65 of the 1960 Act, the immovable properties of a defaulter could be sold for recovery of arrear of land revenue. He also referred to Rule 102 of the 1961 Rules which provided that where a property is put to auction for recovery of arrears of land revenue and there is no bid the Revenue Officer conducting the sale can purchase the same in the name of administrator for Re 1/-. According to Mr. Bhattacharjee, the sale of the two tea estates at the nominal price of Re 1/- each was, therefore, authorised by the 1961 Rules. Mr. Bhattacharjee vehemently argued that since Rule 102 of the 1961 Rules providing for the sale of a property at a nominal price of Re 1/- has not been challenged in the present writ petition, the Court should not interfere with the sales of the two tea estates. He further submitted that Sections 93,.94 and 95 of the 1960 Act provided alternative remedies by way of appeal and revision against any order passed by the Revenue Officer but the petitioners have not availed the said alternative remedies provided by the statute against the sales of the two tea estates and the Court should refuse to exercise its powers under Article 226 of the Constitution of India on this ground alone. In support of this submission Mr. Bhattacharjee relied on the decision of the Supreme Court in Shri Ramdas Motor Transport Limited v. Tadi Adhinarayan Reddy, (1997) 5 SCC 446 : (AIR 1997 SC 2189) and Mafatlal Industries Limited v. Union of India, (1997) 5 SCC 536. He also contended that the Collector rightly rejected the application of the petitioners under Section 73(a) of the 1960 Act for setting aside the sale on the ground that it was barred by limitation. He submitted that the petitioners approached the Collector and has approached this Court for setting aside the sales after considerable delay and on this ground alone, this Court should refuse to set aside the sales of the two tea estates. He finally submitted that the petitioners 'are riot in a position to run the tea estates and the tea factories and a large number of workmen employed therein are likely to be affected if the sales are set aside by the Court. He cited the decision of the Supreme Court in State of Rajasthan v. D.R. Laxmi, (1996) 6 SCC 445 : (1996 AIR SCW 3970), in which the Supreme Court held that when there is inordinate delay in filing the writ petition and when all steps taken in the acquisition proceeding have become final, the Court should be loathe to quash the notification under Section 4(1) and the declaration under Section 6 of the Land Acquisition Act, 1894.

17. Sections 22, 62, 63, 64, 65, 66 and 70 of the 1960 Act and Rules 89, 90, 95, 99, 102 and paragraphs 25 and 32 of Schedule III of the 1961 Rules which are relevant are extracted herein below;

'22.(1) The following persons shall be primarily liable for the payment of land revenue assessed on land, namely-

(a) the person to whom the land belongs;

(b) the under raiyat or any other person in possession of the land, provided that such under-raiyat or other person shall be entitled to credit from the owner of the land for the amount paid by him.

(2) Where there are two or more persons liable to pay land revenue under Sub-section (1) all of them shall be jointly and severally liable for its payment.

62. An arrear of land revenue may be recovered by any one or more of the following processes, namely

(a) by serving a written notice of demand on the defaulter;

(b) by distraint and sale of the defaulter's movable property including the produce of the land;

(c) by the attachment and sale of the defaulter's immovable property.

63. The form and contents of the notice of demand and the officers by whom such notices shall be issued shall be such as may be prescribed.

64. (1) The distraint and sale of the movable property of a defaulter shall be made by such officers or class of officers in such manner and in accordance with such procedure, as may be prescribed.

(2) Nothing in Sub-section (i) shall be deemed to authorise the distraint or sale of any property which, under the Code of Civil Procedure, 1908, is exempt from attachment or sale in execution of a decree or of any article set aside exclusively for religious use.

65. (1) When the Collector is of opinion that the processes referred to in Clauses (a) and (b) of Section 62 are not sufficient for the recovery of an arrear, he may, in addition to or instead of any of those processes, cause the land in respect of which such arrear is due to be attached and sold in the prescribed manner.

(2) The Collector may also cause the right, title and interest of the defaulter in any other immovable property to be similarly attached and sold.

66. (1) Before effecting the sale of any land or other immovable property under the provisions of this Chapter, the Collector or other Officer empowered in this behalf shall issue such notices and proclamations, in such form, in such manner and containing such particulars, as may be prescribed; the notices and proclamations shall also be published in such manner as may be prescribed.

(2) A copy of every notice or proclamation issued under Sub-section (1) shall be served on the defaulter.

70.' Every sale of property, movable or immovable under the provisions' of this Chapter shall, as far as may be practicable, be proportionate to the amount of the arrear of land revenue to be recovered together with the interest thereon and the expenses of attachment and sale.'

THE TRIPURA LAND REVENUE AND LAND REFORMS RULES, 1961.

'89. (1) A notice of demand under Section 62 shall be issued in Form 24 by and under the signature and seal of the circle officer of the circle in which the holding to which the land revenue relates is situated. If such notices are required to be issued against a defaulter residing in another circle, the circle officer may do so either direct or through the circle officer of such other circle.

(2) A sub-divisional officer or Collector any (may?) issue a notice of demand in respect of the land revenue payable on account of any holding which is situated within his jurisdiction.

(3) It shall be issued in duplicate and shall be served in the manner of a notice as prescribed in Schedule III.

(4) The fee for the notice of demand shall be added to the arrears for which the notice is issued and shall be included in the amount specified therein.

90. (1) Any officer, sub-divisional officer or circle officer may issue a warrant of distraint or movable property including the produce of the land of any defaulter in Form 25 and sell the same thereafter by public auction.

(2) Such auction shall be held at the spot unless the officer ordering the auction is of the opinion that the auction if held in any other place would bring a higher price in which case auction may be held at such other place.

(3) If the auction is not held at the spot, due publicity thereof shall be given by issuing a proclamation in Form 26 which may also be proclaimed by beat of drum, if the officer ordering the sale deem it necessary.

95. (1) Where the property is immovable property, the attachment shall be made by an order in Form 27 issued by the Collector prohibiting the defaulter from transferring or charging the property in any manner and all perspns from having any transfer or charge from him.

(2) In addition to service provided for the service of a notice in Schedule III, a copy of the' prohibitory order shall be affixed at a conspicuous part of the property and shall be proclaimed in the locality by beat of drum.

(3) The order shall take effect as against transferees for value in good faith from the date when a copy of the order is affixed on the property and against all other transferees from the date on which such order is made.

(4) No payment made after the making of the proclamation on account of rent or any other asset of the estate or holding to any person other than the Collector or his agent shall be credited to the person making the payment or relieve him from liability to make the payment to the Collector or his agent.

99. (1) When the sale of any immovable property is to be held, the proclamation for sale shall be issued in Form 28 if the, property to be auctioned is the holding on account of which the arrears are due and in. Form 29 if it is some other property belonging to the 'defaulter.

(2) The Officer conducting the sale shall cause wide publicity of the proclamation of sale to be made and may, in addition to other proc esses provided for such publicity in para 33 of Schedule III, get it published in any newspaper having circulation in the area. ;

(3) The proclamation of the intended sale shall State the date time and place of the same and specify the following as clearly and accurately as possible-

i) the property to be sold;

ii) estimated value of the property;

iii) the amount for the recovery of which the sale is ordered; and

iv) such facts which the authority considers material to note in the proceeding in order to charge full and fair value of the property including such other circumstances as a purchaser ought to know.

(4) The proclamation 'mentioned in sub-rule (3) shall be served under Sub-section (2) of Section 66 on the defaulter as provided in paras 22 to 31 of Schedule III.

(5) The authority issuing the proclamation may summon the defaulter and examine him with respect to any manner which is to be included in the said proclamation.

(6) The place of sale to be specified under sub-rule (3) shall be either the office of the circle officer or any place near the property to be sold.

102. When a property is being put to auction, for arrears of land revenue and there be no bid, the revenue officer conducting the sale may purchase the same in the name of the Administrator for one rupee or if the highest bid be insufficient to cover the arrears due may purchase the property on behalf of the State Government at the highest bid.'

SCHEDULE III

PROCEDURE OF REVENUE COURTS

25. A summons shall, if practicable, be served (a) personally on the person to whom it is addressed or failing him (b) on his recognised agent or (c) on any adult male member of his family usually residing with him.

(2) If service cannot be effected as above, or if acceptance of service so made is refused, the summons may be served by pasting a copy thereof on the door of the usual or last known place of residence of the person to whom it is addressed or by publication in a newspaper.

32. Every notice under the Act be served either by tendering or delivering a copy thereof, or sending such copy by post to the person on whom it is to be served, or his authorised Agent or, if service in the manner aforesaid cannot be made by affixing a copy thereof at his last known place of residence or at some place of public resort in the village in which the land to which the notice relates is situated,' Section 22 provides that the person to whom land belongs shall be primarily liable for payment of land revenue assessed on the land. Section 62 further provides that arrear land revenue may be recovered by one or more of the processes mentioned therein.

18. One of the processes mentioned in Section 62, is by serving notice of demand on the der fauher. Since the owner of the land is primarily liable tor payment of land revenue under Section 22 when the land revenue is not paid, the owner of the land is the defaulter. Hence a written notice of demand has to be served on the owner of the land. Section 63 states that the form and content of notice of demand and the officer by whom such notice shall be issued shall be such as may be prescribed. Rule 89 (1) prescribes that notice of demand under Section 62 shall be issued in Form 24 and Rule 89 (3) further prescribes that such notice of demand shall be issued in duplicate and shall be served in the manner as prescribed in Schedule III. Paragraph 32 of the Schedule III states that every notice may be served by either tendering delivery of a copy thereof, or sending such copy by Post, to the person on whom it is to be served, or his authorised agent, or if service of notice in the manner as aforesaid cannot be made, by fixing acopy thereof at his last known place of residence or at such place of public resort in the village in which the land to which notice relates is situated. The aforesaid provisions of the 1960 Act and the 1961 Rules make it clear that a notice of demand of arrear of land revenue has to be served on the owner of the land in Form 24 either by tendering or delivering a copy thereof or sending such copy by Post to the owner of the land, or his authorised agent, and only if service in the aforesaid manner cannot be made, by fixing a copy thereof at the last known place of residence of the owner or at some place of public resort in the village in which the land to which notice relates is situated. In the instant case. Annexures R series of the affidavit filed by the State respondents show that on 3-6 1986 notices of demand in Form 24 were issued. In respect of notice of demand for Laxmilonga Tea Estate, an arrear of land revenue of Rs. 6629.92 plus Re 1/- towards process fee for a total land measuring 569.27 acres was demanded to be paid within 7 days from the date of receipt of the notice. But the said notice of demand was not delivered at or sent to the registered office of the petitioner company at Calcutta and was instead hung on a tree at the spot by the process Peon Shri Mali Chahd Debverma on 11-3-1987 and signature of two witnesses Sugra Munda and Munia Munda were obtained. Similarly, in the notice of demand in respect of Tufanialonga Tea Estate, an arrear of land revenue of Rs. 4137.34 plus Re 1/- process fee for the land measuring 426,36 acres was demanded to be paid within 7 days from the date of receipt of the demand notice. But the said demand notice was not delivered at or sent to the registered office of the petitioner company at Calcutta but was hung on a tree at the spot by the process Peon Shri Mali Chand Debverma on 11-3-1987 after taking signature of two witnesses Supra Munda and Nunis Munda. On the date on which the aforesaid demand notices were hung on the trees at the spots, the tea estates were under the management and possession of the Tripura Tea Development Corporation Limited appointed as custodian of the properties of the tea estates under the impugned Ordinance and the impugned Act by the State Government and the two petitioner companies or their authorised agents were not in the management and possession of the two tea estates when the notices were hung on the trees of the respective tea estates. The provisions of the 1960 Act and the 1961 Rules and in particular paragraph 32 of Schedule III of the 1961 Rules required that the notice of demand was first sent or delivered to the petitioner companies at their registered offices at Calcutta or to their authorised agents, and only if service in the aforesaid manner could not be made, by affixing a copy of the notice at the lastknown address of the petitioner companies or some place of public resort in the village in which the land to which the notice relates is situated. But in the instant case without even attempting to serve the notices of demand at the registered office of the two petitioner companies at Calcutta or on their authorised agents, if any, the notices of demand were hung at some tree of the spot taking signature of two persons. In our considered opinion, therefore, the notices of demand have not been served on the petitioner companies in accordance with the provisions of Sections 22 and 62 of the 1960 Act and Rule 89 read with paragraph 32 of the Schedule III of the 1961 Rules.

19. The second mode of recovery of land revenue as provided in Section 62 of the 1960 Act is by distraint and sale of movable properties including the produce of the land. Section 64(1) however, states that the distraint and sale of movable properties of a defaulter shall be made by such officers or class of officers in such manner and in accordance with such procedure, as has been prescribed. Rule 90( 1) prescribes that warrant of distraint of movable properties of any defaulter is to be issued in Form 25. Annexure-R series of the affidavit of the State respondents show that in the case for recovery of land revenue of Laxmilonga Tea Estate on 10-7-1986 From 25 was sent to the Tehshil Office. The distraint warrant in Form 25 was thereafter sent to the in-charge Devendra Chandranager TK who wrote behind the said Form 25 on 30-6-1986 that there was no movable properly and returned the distraint warrant to the Certificate Officer without execution. Similarly, in the case relating to recovery of land revenue of Tufanialonga Tea Estate on 11-6-1986 Form 25 was issued for distraint of movable property and was sent to Tehshil. Thereafter, the distraint warrant in Form 25 was sent to the in-charge Devendra Chandranager TK who wrote behind the said Form 25 that there was no movable property and he returned the distraint warrant without execution to the Certificate Officer. It is thus clear that Form 25 was not sent to the two petitioner companies at Calcutta who were defaulters of the arrear land revenue and some one other than defaulter or the authorised agent of the defaulter has returned the distraint warrants with a note that there was no movable property.

20. Still the third mode of recovery of arrear of land revenue under Section 62 of the 1960 Act is by attachment and sale of immovable property of the defaulter as stated in Section 62 of the 1960 Act. But Section 65(1) makes it clear that the Collector can cause the land in respect of which arrear of land is due to be attached and sold in the prescribed manner only if he is of the opinion that the first two modes of recovery namely service of written notice of demand on the defaulter and warrant of distraint and sale of the defaulter's movable properties are not sufficient for the recovery of the arrear land revenue. Section 66(1) further provides that before effecting sale of any land or other immovable property, the Collector or other Officer empowered in this behalf shall issue such notices and proclamation in such Form in such manner and containing such particulars, as may be prescribed, and the notice of proclamation shall also be published in such manner as may be prescribed. Sub-section (2) of Section 66 further states that copies of every notice of proclamation issued under Sub-section (1) shall be served on the defaulter. Rule 95(1) prescribes that the attachment of immovable property shall be made by an order in Form 27. Rule 95(2) further prescribes that in addition to service as provided for service of notice in Schedule III, a copy of prohibitory order shall be fixed at a conspicuous part of the property and shall be proclaimed in the locality by beat of drum. It is thus clear that Form 27 has to be served on the defaulter in the manner prescribed by paragraph 32 of Schedule III of the 1961 Rules. Annexure R series showthat in respect of Laxmilonga Tea Estate on 25-1-1987 prohibitory order in Form 27 was issued and was served by the Peon Shri Mali Chand Debverma on someone of Laxmilonga Tea Estate. In para 37 of the affidavit filed on behalf of the respondents Nos. 1,2,3 and 5 it is stated that the notice in Form 27 was received by the employee of Laxmilonga Tea Estate. Paragraph 32 of the Schedule III of the 1961 Rules requires that notice is to be served on the person on whom it is to be served or his authorised agent. Since the petitioner company was the defaulter and Form 27 was required to be served as per provisions of Section 66(2) on the defaulter, Form 27 had to be served either on the petitioner company or its authorised agent. The management and possession of Laxmilonga Tea Estate at the time the aforesaid Form 27 was served was with the Tripura Tea Development Corporation Limited as custodian appointed by the State Government under the impugned Ordinance and the impugned Act. Receipt of Form 27 by an employee working under the saidcorporation would, therefore, not amount to receipt either by the petitioner company or by its authorised agent. Similarly, in the case of Tufanialonga TeaEstate, the prohibitory order in Form 27 was issued and the Peon Shri Mali Chand Debverma went to Tufanialonga Tea Estate and served the notice on 10-3-1987. Nothing however, has been stated in the affidavit of the State respondents as to who received the notice on 10-3-1987 on behalf of the Tufanialonga Tea Estate. The'fact remains that on 10-3-1987, the management and possession of the said estate was with the Tripura Tea Development Corporation Limited as the custodian appointed by the State Government under the impugned Ordinance and the impugned Act. Hence serving of Form 27 on some person at the tea estate was not a service on the petitioner company or its authorised agent as provided in paragraph 32 of the Schedule III of the 1961 Rules..

21. Rule 99(1) prescribes that the proclamation for sale of immovable property is to be issued in Form 28 and Rule 99(2) further provides that the officer conducting the sale shall cause wide publicity of the proclamation of sale. Rule 99(4) further prescribes that the proclamation shall be served under Sub-section (2) of Section 66 on the defaulter as provided in paragraphs 22 to 31 of the Schedule III. Annexure-R series show that on 30-4-1987 Form 28 was issued in respect of Laxmilonga Tea Estate fixing the date of auction to 2-6-1987 and on 6-5-1987 the Peon Shri Mali Chand Debverma endorsed ' behind the said Form 28 to the effect that he went to Harendra Nagar Tea Garden but the Manager of the Tea Garden refused to take notice and put his signature and that he hung the notice on a tree nearby. Similarly, on 30-4-1987 Form 28 was issued in the case of Tufanialonga Tea Estate fixing the date of auction to 2-6-1987 and on 6-5-1987 behind the said Form 28 an endorsement has been made by the Peon Shri Mali Chand Debverma to the effect that he went to the Tufanialonga Tea Garden and requested the manager to receive the notice but he refused to receive the notice and put his signature and, therefore, he hung the notice on a tree. The provisions of paragraph 25 of Schedule III of the 1961 Rules, required that the said Form 28 were served on the petitioner companies or their recognised agents and if Form 28 could not be served or if acceptance of service was refused. Forms 28 could be pasted on the door of the usual or last known place of residence of the petitioner companies. But Form 28 were not served on the petitioner companies at their addresses at Calcutta or on their recognised agents as provided in the said paragraph 25 of Schedule III of the 1961 Rules. Annexure R series and in particular the copies of the order-sheets in the two cases for recovery of arrear land revenue do not show that wide publicity was given to the proclamation for sale in Form 28 as provided in Rule 99(2) of the 1961 Rules. The said copies of the order-sheets further show that on 2-6-1987, 3-6-1987 and 4-6-1987 auction was taken up and as no bidder was present, the land of Laxmilonga Tea Estate measuring 569.27 acres including all movable properties and the land of Tufanialonga Tea Estate measuring 426.36 acres including all movable properties were sold in favour of the State Government of Tripura under Rule 102 of the 1961 Rules on payment of Re 1/- in each case due to non-payment of land revenue of Rs. 6639.92 and Rs. 4147.34 respectively on 4-6-1987 and the said sales were confirmed by the District Collector on 20-7-1987 under Section 73 of the 1960 Act and Rule 106 of the 1961 Rules as no petition for reconsideration of the sale was filed.

22. The aforesaid discussion of the different steps that were taken in the two cases for recovery of arrear land revenue would show that the provisions of 1960 Act and 1961 Rules were not followed before the ultimate step was taken for sale of the movable and immovable properties of the two tea estates under Rule 102 of the 1961 Rules to the State Government on payment of Re. 1/- for each tea estate and for confirming the sales under Section 103 of the 1960 Act and Rule 106 of the 1961 Rules. Section 65 of 1960 Act made it abundantly clear that only when the Collector was of the opinion that the process of serving of written notice of demand on the dafaulter and the process of distraint and sale of the movable properties of the defaulter were not sufficient for recovery of arrear of land revenue he could in addition to or instead of any of the aforesaid two processes, cause the land in respect of which such arrear is due to be attached and sold in the prescribed manner. Unless, therefore, a written notice of demand was served on the defaulter in Form 24 or an attempt was made to recover the arrear land revenue by serving a warrant of distraint of movable properties of the defaulter in Form 25 on the defaulter and by selling such movable properties, the Collector could not possibly take a view that such service of written notice of demand and such distraint and sale of defaulter's movable properties were not sufficient for recovery of the arrear of land revenue. That apart, Section 70 provides that every sale of property movable or immovable, shall as far as may be practicable be proportionate to the amount of arrear of land revenue to be recovered together with interest thereon and the expenses for attachment and sale. In the instant case, the arrear of land revenue in one case was Rs. 6639.92 and in other case was Rs. 4147.34. The mandate of Section 70 required that only a portion of the land the value of which was proportionate to the aforesaid amount of arrear of land revenue was ordered to be sold at the first instance so that the aforesaid amount of arrear land revenue together with interest thereon and the expenses of attachment and sale could be recovered. But it appears that at the very first instance the entire land of Laxmilonga Tea Estate measuring 569.27 acres including all movable properties and the entire land of Tufanialonga Tea Estate measuring 426.36 acres were sold at a price of Re 1/- in each case contrary to the said mandate of Section 70 of 1960 Act. In our considered opinion therefore the sale of the two tea estates and confirmation of the sale in favour of the State Government for Re 17- for each tea estate was in gross violation of the provisions of the 1960 Act and the 1961 Rules and were beyond the jurisdiction of the Collector and null and void. In Nani Gopal Paul's case (AIR 1995 SC 1971) (supra) cited by Mr. Chakravorty, the Supreme Court held that the Court would not remain a mute and helpless spectator to obvious and manifest illegalities committed in conducting Court sales and set aside a Court sale and confirmation of a Court sale in which manifest illegalities were noticed by the Court. We are of the view that since gross illegalities have been committed in selling valuable properties of the two petitioners at a nominal price of Re 1/- for each tea estate to the State Government in the present case, we should set aside the sales of the two tea estates and remand the matter to the Collector for initiating fresh steps for recovery of the aforesaid arrear land revenue in accordance with the provisions of the 1960 Actandthe 1961 Rules as discussed above.

23. It is true as has been submitted by Mr. Bhattacharjee that the petitioners could have challenged the aforesaid sales before the appropriate authority under the 1960 Act and 1961 Rules and, therefore, had alternative remedy against the sales under the statute. But the writ petition challenging the sales of the two tea estates was filed before this Court on 2-2-1994 and admitted on 13-4-1994. The petitioners have waited for more than five years since 1994 before this Court for relief against the illegal sales of their valuable properties at a nominal price of Rs 1/-. It will not be proper exercise of our discretion under Article 226 of the Constitution to refuse to interfere with the sales on the ground that alternative remedy was available to the petitioners for challenging the sales after having admitted the writ petition about five years back. Moreover, the illegalities in the sales of the two tea estates are apparent on the face of the records, copies of which have been annexed to the counter affidavit of the State respondents as Annexures-R series. No disputed questions of facts were required to be decided for the purpose of finding out whether any illegality was committed. After having found that mainfest illegalities were committed in the sales of the two tea estates and that the sales of valuable properties at the nominal price of Re 1/- for each tea estate were shocking to the judicial conscience, We will be failing in our duty as a Court of Justice if We do not set aside the sales.

24. In the ease of Shri Ramdas Motor Transport Limited (AIR 1997 SC 2189) (supra) cited by Mr. Bhattacharjee, the Supreme Court was not considering a case of a sale of valuable property made in gross violation of statutory provisions but Was considering some disputes between the parties relating to the management of affairs of some companies. The Supreme Court found that under Section 397 of the Companies Act any member of a Company complaining that the affairs of the company are being conducted in a manner prejudicial to the public interest or in a matther oppressive to any member or members may apply to the Company Law Board for an order under that section and that some of the share-holders of the appellant company had in fact filed a petition under Sections 397 and 398 of the Companies Act before the Company Law Board and the Company Law Board was not taking any action in the matter. On these facts the Supreme Court held that as the share-holders had effective remedy under the Companies Act for prevention of oppression and mis-management, the High Court should not readily entertain a writ petition under Article 226 of the Constitution merely on the ground that the Company Law Board was not taking any action on the matter. In Mafatlal Industries Limited (1997 (5) SCC 536) relied on by Mr. Bhattacharjee the Supreme Court was also not Considering a case of a sale of valuable property at a nominal price in violation of the statutory provi sions but of cases of refund of Central Excise Duty paid to the Department and the Supreme Court held that since Section 118 of the Central Excises and Salt Act, 1944 provided a statutory remedy for such refund, the High Court should not in exercise of its power under Article 226 of the Constitution direct refund of the Central Excise Duty contrary to the said provisions of Section 11-B of the Act. In State of Rajasthan v. D.R. Laxmi (1996 AIR SCW 3970) (supra) cited by Mr. Bhattacharjee again, the Court was not considering a case of sale of valuable property at a nominal price in gross violation of statutory provisions but of a case of Land. Acquisition Act, 1894 and held that where there is inordinate delay in filing the writ petition challenging a notification for acquisition of land under Sections 4 and 17 of the said Act and possession of the land had already been taken over either under Section 17(2) or Section 16 of the Act and land stood vested in the State Government free from all encumbrances, the Court should be loathe to quash the notification and interfere with the acquisition of land by the State.

25. The Court also should not refuse to set aside the sales made in gross violation of the statutory provisions merely on the ground that petitioners were not in a position to run the tea units as a large number of workmen employed therein are likely to be affected if the sales of two tea estates are set aside. The Court cannot be oblivious of the fact that in the case of Laxmilpnga Tea Estate land measuring 569.27 acres including all movable properties therein were sold for Re 1/- and in the case of Tufanialonga Tea Estate the land measuring 426.36 acres including all movable properties therein were sold for Re l/-and that the aforesaid land were mortgaged against a loan to the United Bank of India and the said Bank had a claim of Rs. 1.20 Crores against the petitioner companies. Moreover, even if the sales are set aside a scheme for running the two tea units can always be negotiated between the parties to ensure that the workers in the two tea units are continued to be employed and at the same time the liabilities of the petitioner companies including those payable to the Bank are paid. In case such a scheme is not possible it is also open for the Central Government to assume the management and control of the tea undertakings or units under Sections 16D and 16E of the Tea Act, 1953, if such assumption of management and control of the tea undertakings and units were permissible under the said provisions of the Tea Act, 1953. In the facts of the present case therefore it will not be a proper exercise of discretion under Article 226 of the Constitution on the part of the Court to refuse to set aside the sales of the two tea estates.

26. It was next submitted by Mr. Chakravorty that ever since the management and possession of the two tea estates were taken over by the State Government under the impugned Ordinance and the impugned Act in the year 1986 no compensation whatsoever has been paid to the petitioner companies. He referred to section 5 of the impugned Act which states that each of the tea Companies whose units have been taken over by the State Govt. will be paid by the State an amount in cash at the rate to be specified by the State Government and the amount so specified shall be paid every year during which management of the tea units remained vested in the State Government under the Act. Relying on the affidavit-in-opposition of the State respondents, he submitted that the State Government has not yet specified the amount in cash to be paid to the tea units for taking over of the management of the tea units. Mr. Chakravorty submitted that since under the arrangement between the State Government and the Tripura Tea Development Corporation Limited, the Tripura Tea Development Corporation Limited has to pay a total sum of Rs. 1,91,89,000/- by instalments for 10 years at a yearly payment of Rs. 10.00 Lakhs per garden, the State Government should be directed to pay at the said rate per year with interest of 18% per annum for default in making regular yearly payment. Mr. Bhattacharjee the learned Advocate General relied on the averments in their affidavit-in-opposition of the State respondents that the Tripura Tea Development Corporation Limited has invested huge amount in the tea units of the petitioner for rehabilitation of the tea units taken over by the State Government. Mr. B.K. Das, learned counsel for the United Bank of India contended that the amount payable to the petitioner Companies under Section 5 of the impugned Act should be paid by the State Government to the said Bank so that the liabilities of the petitioner companies to die Bank can be adjusted. He cited 'the decision of B.L. Hansaria J in B.C. Chaturvedi v. Union of India, AIR 1996 SC 484, that the High Court has powers to do complete justice in a case and contended that if the amount was paid to the Bank complete justice would be done in this case.

27. Section 5 of the impugned Act is quoted herein below:

5. Payment of amount-

(1) Each of the Tea Company shall be given by the State Government an amount, in cash and at the rate to be specified by the State Government, for vesting in it, under Section 3 of the management of the undertakings of each such company in relation to such tea units and the amount so specified shall be paid every year during which the management of tea unit remains vested in the State Government under this Act.'

By the aforesaid Section 5 of the impugned Act, the State Govt. has been vested with the power to specify the rate at which the amount has to be paid to each of the tea companies management of which has been taken over under Section 3 of the Act. The said section further provides that the amount specified shall be paid every year during which the management of the tea unit is vested in State Government under the Act. Thus, it is not for me Court but for the State Government to specify the rate at which the amount should be paid every year during which the management of the tea unit remained vested in the State Government under the impugned Act. Admittedly, the State Government has not specified the rate under Section 5 of the Act. Thus the State Government will have to specify the rate for which petitioner companies have to be paid for the period from 13-11-1986 when the management of the undertakings of the petitioner companies in relation to the two tea units were taken over under the impugned Act till the two estates were sold on 4-6-1987 to the State Government for recovery of the arrear of land revenue. The aforesaid Section 5 of the impugned Act does not say that the State Government shall not pay the amount at the rate specified by the State Government to the concerned tea company if any investment was made by the State Government or the custodian appointed by it in the tea units during the period the management of undertakings in relation to tea units was with the State Government or its custodian. The State Government will therefore, have to pay the amount at the rate specified to the petitioner companies for the period from 13-11-1986 to 4-6-1987.

28. During the period from 4-6-1987 onwards, however, the State Government or the Tripura Tea Development Corporation Limited continued to be in possession of the two tea units not by virtue of the provisions of the impugned Act but on account of the sale of the two tea estates to the State Government on 4-6-1987 in the proceedings for recovery of arrear land revenue. Since we have held that the sales of the two tea estates on 4-6-1987 and the confirmation of the sales on 20-7-1987 by the Collector were contrary to the provisions of 1960 Act and the 1961 Rules and were illegal and void, the Court will have to work out the equities between the parties and grant reliefs to them. Obviously the rate that is determined by the State Government under Section 5 of the impugned Act for payment of the amount every year would constitute a reasonable basis for determining the compensation that may be payable by the State Government to the petitioner companies for the period from 4-6-1987 onwards. But it appears from the affidavit dated 24-12-1998 filed by Shri Suresh Chandra Singh, Under Secretary to the Government of Tripura. Department of Industries and Commerce, pursuant to order dated 26-31-1998 of this Court that substantial amounts have been spent by the Tripura Tea Development Corporation Limited out of its own funds and out of funds received from the State Government by way of capital investment in the two tea units. Further some amounts have also been paid to meet statutory liabilities of the workers. The figures of such capital investment and payment towards statutory liabilities of the two petitioner companies furnished in the said affidavit of the Under Secretary to the Government of Tripura, Department of Industries and Commerce, however, have been disputed by the affidavit of Shri Sushenjif Paul, Constituted Attorney and Director of the two petitioner companies. The exact amounts of such capital investment actually made in the two tea units and the amounts of payment made towards statutory liabilities of the petitioner companies will have to be determined by the State Government and the said amounts of capital investment and payment of the statutory liabilities of the petitioner companies will have to be deducted out of the amount to be paid by the State Government to the petitioner companies as compensation for the period from 4-6-1987 onwards.

29. We are unable to accept the submission ofMr. Das. learned counsel for the United Bank ofIndia, that the amounts payable by the StateGovernment to the petitioner companies shouldbe paid to the United Bank of India and not to thepetitioner companies because a suit has beenfiled by the United Bank of India against the twopetitioner companies for recovery of the dues ofthe Bank and is presently pending before theDebt Recovery Tribunal. The United Bank ofIndia may move the said Tribunal for appropriateorders in the said suit and this Court in the presentproceeding cannot direct the State Governmentto pay the amount due to the petitioner to theUnited Bank of India. '

30. Having held that the sales of the two tea estates, for recovery of the arrear land revenue were illegal and void we would have normally directed restoration of the possession of the two tea estates to the petitioner companies forthwith as the maximum period of 7 years for management of the tea units by the State Government under the impugned Act is over since 1993. But in the affidavit of the Under Secretary to the Govt. of Tripura, Department of Industries and Commerce filed on 24-12-1998 pursuant to our order dated 26-11-1998, it is stated that in Laxmilonga Tea Estate a total of 283 persons are presently working and in Tufanialonga Tea Estate 212 persons are working. It has further been stated in the said affidavit of the Under Secretary to the Government of Tripura. Department of Industries and Commerce that after the Laxmilonga Tea Estate was taken over in 1986 under the impugned Act by the State Government production of tea has increased from 1,15,449 Kg to 4,20,566 Kg. and after the Tufanialonga Tea Estate was taken over in the year 1986 under the impugned Act by the State Government the production of tea has increased from 60,705 Kg to 2,89,567 Kg. Though the figures of the total number of employees presently working in the two tea estates and the figures of production have not been admitted in the affidavit of the Constituted Attorney and Director of the two petitioner companies filed on 16-2-1997, it is not disputed that the Tripura Tea Development Corporation Limited is presently rnanaging these two tea estates and that there is production of tea in the two tea units and that number of employees arc engaged in the two tea estates. The Court is unable to knowfrom the said affidavit of the Constituted Attorney and Director of the two petitioner companies as to whether the two petitioner companies are in a position to run the two tea units and continue in employment the employees presently engaged in the two tea units and continue production of reasonable quantity of tea. This is a fit case, therefore, in which we should not direct restoration of the two tea estates to the petitioner companies immediately until the petitioner companies satisfy the State Government that they arc in a position to run the two tea estates either on their own or through a scheme negotiated with the Tripura Tea Development Corporation Limited or some olhcr organisation on mutually acceptable terms and conditions.

31. In the result, while upholding the validity of the impugned Act and the impugned Ordinance, we set aside the sales and confirmation of sales of the two tea estates to the State Government and remit trie matter back to the Revenue Court for taking fresh steps in accordance with the 1960 Act and the 1961 Rules as discussed in this judgment. After the petitioner companies arc served with the written notices of demand of arrear land revenue they may raise their contentions on the merits of the demand before the Revenue Court which will decide the same in accordance with the 1960 Act and the 1961 Rules. We further direct that the State Government will within six months from today specify the rate payable every year to the petitioner companies under Section 5 of the impugned Act and pay tile amount determined on the basis of such rate specified by the State Government to the petitioner companies for the period from 13-11-1986 to 4-6-1987. We also direct that the State Government will within six months from today also determine the compensation that will be payable to the petitioner companies for the period from 4-6-1987 onwards till the date of this judgment in accordance with this judgment and pay the same to the petitioner companies within six months from today. Since the petitioner companies have not been paid any amount as yet, we direct that pending determination of the amount and compensation by the State Government the petitioner companies will be paid Rs. 10 Lakhs for each of the tea estates within two months from today and the aforesaid amount of Rs. 20.00 lakhs (Rs. 10.00 lakhs + Rs. 10.00 Lakhs) will be adjusted towards the amount and compensation to be paid by the State Government. We make it clear that the two tea estates may not be restored to the petitioner companies until they satisfy the State Government that the two tea units will be run either by the petitioner companies or through a scheme negotiated with the Tripura Tea Development Corporation Limited or some other organisation on mutually acceptable terms and conditions and the compensation at rates determined by the State Government will be paid to the petitioner companies till possession is restored to the petitioner companies once every six months. In case any amount or compensation is not paid within the time stipulated in this judgment, the petitioner companies will be entitled to interest at the rate of 18% per annum on the amount or compensation that is over due. Liberty is also given to the parties to apply to this Court in case of any difficulty arising out of implementation of aforesaid directions or any difficulty with regard to the determination of the amount or compensation. With the aforesaid directions, the writ petition stands disposed of. Considering, however, the facts and circumstances of the case., the parties shall bear their own costs.