2004 (1) TMI 704 - SC - Indian Laws

Supreme Court Upholds Constitutionality of 1996 Act, Validates Assam Legislature's Authority, No Conflict with Central Laws.

The SC dismissed the appeals, affirming the constitutional validity of the Bharat Hydro Power Corporation Limited (Acquisition and Transfer of ... Constitutional validity of the Bharat Hydro Power Corporation Limited (Acquisition and Transfer of Undertaking) Act, 1996 being Assam Act 1 of 1997 published in the Assam Gazette Extraordinary dated 6th January, 1997 - delay in the completion of the project - HELD THAT:- The State Act has been enacted to take over the Bharat Hydro Power Corporation in public interest as it could not complete the project within time so that the State could efficiently supervise manage and execute the work expeditiously to subserve the common good, in the context of the acute power shortage in the State. The State after taking over the project had the power to hand it over to the Board for completing the project. Provision has been made to pay adequate compensation which is to be determined by a Commission constituted under the Act for payment of adequate compensation. Contention raised on behalf of the appellants is that Central Act makes specific provisions for compulsory purchase of undertaking and a detailed procedure has been prescribed and the State Act has created a parallel procedure for purchase of the undertaking thereby impinging on the Central Act and is therefore repugnant to the Central Act. We do not find any substance in this submission. A combined reading of Sections 2(4A) and 2(6) makes it clear that even if the appellant No. 1 is taken to be a generating company (which is not necessary to be determined in this case) it would not be a 'licensee' because the generating company has been specifically excluded from being a licensee notwithstanding the provisions of Sections 26 or 26A of the 1948 Act. As pointed out earlier only Sections 12 to 19 of the Act of 1910 have been made applicable to a generating company. Sections 3 to 11 of Act of 1910 do not apply to a generating company. Section 37 of Act of 1948 provides for purchase of generating stations or undertakings or main transmission lines by the Board. This Section would also not apply to the present case. The legislature in its wisdom made only certain provisions of Act of 1910 applicable to a generating company in Section 26A. Contention that the impugned Act is in violation of provisions of Act of 1910 or the Act of 1948 has no basis to stand on. The impugned Act and the Central Acts in the instant case operate in two different fields without encroaching upon each other's field in as much as the true nature and character of the impugned State Act is to acquire the undertaking and pay compensation as provided in the Act whereas both the Central Acts (Acts of 1910 and 1948) have made general provisions with regard to supply and use of electrical energy. The provisions regarding purchase of undertaking in the Act of 1910 would not be applicable as the appellants are not licensees within the meaning of the Act of 1910. There is not even a semblance of conflict what to talk of direct conflict between the impugned State Act and the Central Acts to bring about the situation where one cannot be obeyed without disobeying the others. Both the Acts can operate simultaneously as they do not occupy the same field. As the enactments operate in two different fields without encroaching upon each other's field there is no repugnancy. Since there is no repugnancy the question of the State Act being kept for the consideration of the President or receiving his assent did not arise. Thus, we do not find any merit in these appeals and the same are dismissed. Parties shall bear their own costs in these appeals. Issues Involved:1. Constitutional validity of the Bharat Hydro Power Corporation Limited (Acquisition and Transfer of Undertaking) Act, 1996.2. Legislative competence of the Assam State Legislature to enact the Act.3. Repugnancy between the State Act and Central Acts (Indian Electricity Act, 1910 and Electricity (Supply) Act, 1948).Summary:1. Constitutional Validity of the Act:The appellants challenged the constitutional validity of the Bharat Hydro Power Corporation Limited (Acquisition and Transfer of Undertaking) Act, 1996, arguing it was ultra vires and violative of Articles 14 and 19(1)(g) of the Constitution of India. The Division Bench of the High Court of Gauhati upheld the Act, reversing the learned Single Judge's decision which had struck down several sections of the Act as repugnant to the Central Acts.2. Legislative Competence:The Supreme Court examined the legislative competence of the Assam State Legislature under Articles 245 and 246 of the Constitution. The Court noted that legislative fields are divided into Union List (List I), State List (List II), and Concurrent List (List III). The Court applied the doctrine of 'pith and substance' to determine the true nature of the legislation. The Division Bench held that the Act fell under Entry 17 of List II (State List) and not under Entry 38 of List III (Concurrent List), thus within the legislative competence of the State Legislature.3. Repugnancy Between State and Central Acts:The appellants argued that the State Act was repugnant to the Central Acts, specifically the Indian Electricity Act, 1910, and the Electricity (Supply) Act, 1948, which cover the field of electricity generation and supply. The Supreme Court, however, found no direct conflict between the provisions of the State Act and the Central Acts. The Court noted that the State Act aimed to acquire the undertaking and pay compensation, while the Central Acts provided general provisions for the supply and use of electrical energy. The Court concluded that the State Act and the Central Acts operated in different fields without encroaching upon each other, thus no repugnancy existed.Conclusion:The Supreme Court dismissed the appeals, upholding the validity of the Bharat Hydro Power Corporation Limited (Acquisition and Transfer of Undertaking) Act, 1996, and confirming the legislative competence of the Assam State Legislature to enact the Act. The Court found no repugnancy between the State Act and the Central Acts, allowing both to operate simultaneously.