Gazette notification controls licence commencement, and forced delivery before payment was held to impose an unconstitutional burden.

Where a licence and the governing rules deem the Gazette notification to be the commencement date, that date governs computation of the period for exercising the purchase option, so the notice was treated as timely on that basis. Section 6(6) of the Indian Electricity Act, 1910, requiring delivery of the undertaking before payment of the purchase price, was held to impose an unreasonable burden on property and business rights because the scheme provided no effective interest remedy on the deferred amount, making it inconsistent with Articles 19(1)(f) and 19(1)(g). The result was that the purchase notice did not validly effect the takeover.

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Issues: (i) whether the commencement of the electricity licence was the date of the Gazette notification or the date of signing of the licence for computing the period within which the option to purchase could be exercised; (ii) whether section 6(6) of the Indian Electricity Act, 1910, requiring delivery of the undertaking before payment of the purchase price, violated Articles 19(1)(f) and 19(1)(g) of the Constitution of India.

Issue (i): whether the commencement of the electricity licence was the date of the Gazette notification or the date of signing of the licence for computing the period within which the option to purchase could be exercised

Analysis: The licence expressly treated the date of notification in the Gazette stating that the licence had been granted as the commencement of the licence, and Rule 18 of the Indian Electricity Rules, 1922, deemed the date of notification to be the commencement date. The court also treated the subsequent amendment and the surrounding language as consistent with that construction and held that extrinsic material could assist where the instrument contained ambiguity.

Conclusion: The commencement date was the date of the Gazette notification, and the notice exercising the option was timed accordingly.

Issue (ii): whether section 6(6) of the Indian Electricity Act, 1910, requiring delivery of the undertaking before payment of the purchase price, violated Articles 19(1)(f) and 19(1)(g) of the Constitution of India

Analysis: The provision compelled the licensee to part with the undertaking before receiving the purchase price, while the statutory scheme did not empower the arbitrator under section 7A to award interest on the withheld amount. The resulting deprivation was held to impose an unreasonable burden on the right to carry on business and on property rights, and the shareholder was held entitled to challenge the impairment of the company's rights.

Conclusion: Section 6(6) was unconstitutional as violative of Articles 19(1)(f) and 19(1)(g).

Final Conclusion: The purchase notice did not effect a valid purchase, the taking over of the undertaking was unlawful, and the undertaking had to be returned to the licensee.

Ratio Decidendi: Where a licence and the governing rules deem the Gazette notification to be the commencement date, that date controls computation of the purchase period; and a statutory scheme that requires delivery of the undertaking before payment, without any effective provision for interest on the deferred purchase price, imposes an unreasonable restriction and is invalid.

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