1994 (5) TMI 263

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....ed in the Factories Act, wherein processing of cashew nuts is being carried on and includes the factory building, the site thereof, and the buildings, and lands appurtenant thereto used or necessary for, or in connection with the working of the factory. Section 3 provides : "Order of acquisition.- (1) The Government may, if they are satisfied- (a) that the occupier of a cashew factory does not conform to the provisions of law relating to safety, conditions of service or fixation and payment of wages to the workers of the factory; or (b) that raw cashew nuts allotted to a cashew factory by the Cashew Corporation of India are not being processed in the factory to which allotment has been made or that such nuts are being transferred to any other cashew factory; or (c) that there has been large scale unemployment, other than by way of lay off or retrenchment, of the workers of a cashew factory, by order published in the Gazette, declare that cashew factory shall stand transferred to, and vest in, the Government: Provided that before making a declaration under this subsection in respect of a cashew factory, the Government shall give the occupier of the factory and the ....

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.... before the Government of Kerala against the proposed action within seven days of the receipt of this notice or the publication of this notice in the newspapers, whichever is earlier or if they so desire, appear before the Special Officer for Cashew Industry, Quilon at Quilon at 11 a.m. on 4-7-1988 and state their objections. If no objections are received within the said period or no person appears on the said date it will be presumed that there are no objections against the proposed action and further steps will be taken......" In the said notice the names of 36 cashew factories including that of tile petitioners have been mentioned and thereafter the grounds on which the factories were being acquired have been stated as follows "GROUNDS It has been reported by the authorised officer that your factory is lying closed and that there is no possibility of it to start functioning within a period of ten days or in the immediate future. Government are, therefore, of opinion that the said situation will lead to a large scale unemployment, other than by way of lay off or retrenchment, of the workers of the cashew factory." 4. On behalf of the petitioners, objections were filed....

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.... Now therefore, in exercise of the powers conferred by clause (c) of sub-section (1) of Section 3 of the Kerala Cashew Factories (Acquisition) Act, 1974 (29 of 1974), the Government of Kerala hereby declare that the factories mentioned in the Schedule below shall stand transferred to and vest in the Government with effect from 6-7-1988." Section 3 vests power in the Government, to declare that the cashew factory in question shall stand transferred to and vest in the Government, if the Government is satisfied that any of the three conditions mentioned in the said subsection (1) of Section 3 exists. That power has not been questioned in the present writ application. But it was pointed out that the proviso to sub-section (1) of Section 3 enjoins upon Government, before issuing a declaration, to follow a procedure which is imperative and mandatory in nature i.e. 'the Government shall give the occupier of the factory and tile owner of the factory, where he is not the occupier, a notice of their intention to take action under this sub-section and the grounds therefor and consider the objections that may be preferred in pursuance of such notice'. (emphasis supplied) 7. It cannot b....

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....o any conditions pertaining to their factories. 9. There is no dispute that the cashew nut factories do not work throughout the year but work for varying periods depending upon the supply of raw nuts etc. As such the particulars of the alleged closure of each of the factories were required to be furnished to the individual owner to meet the case against him. The object of the Act is to safeguard the interests of the workers in the cashew factories and it is to safeguard their interests that the power has been vested in the State Government to issue orders for the transfer of the factories. The transfer or vesting of the factories has to be in accordance with the procedure prescribed in the Act. As already pointed out above, the proviso to sub-section (1) not only requires a notice to be given to the occupier or the owner of the factory in respect of the intention of the Government to take action under the said sub-section, but also requires to furnish the grounds on which such action is considered necessary. In the present case, according to us, the notice does not comply with and conform to the requirement of the proviso to sub-section (1) of Section 3. 10. It is well-settle....