TaxTMI 
TaxTMI 
2010 (5) TMI 965
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....a and in the alternative seek a limited declaration that Sections 2, 3, 5 and 6 of the Act are unconstitutional and liable to be struck down. 2. The Act is attacked as unconstitutional mainly on the following grounds: • That it seeks to nullify a judgment of this Court dated 13.02.2001 affirming the view taken by High Court of Bombay Goa Bench, in its judgment dated 21.01.1999. • That it seeks to give effect to the decision of the High Court of Bombay dated 19/24th April 2001, which judgment has the effect of over ruling the judgment of this Court dated 13.02.2001. • That it seeks to give effect to the judgment of High Court of Bombay Panaji Bench, dated 19/24th April 2001, when the said judgment is the subject matter of appeal before this Court in several Special Leave Petitions and thus seeks to frustrate the rights of the petitioners herein under Article 136 of the Constitution of India. • That it seeks to take away the fundamental rights guaranteed to the petitioners under Article 14 and 19(1)(g) of the Constitution of India. • That it is contrary to plethora of judgments of this Court. • That as an Explanatory Memorandum and the State....
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....nded, that, the State deemed it expedient not only to prohibit any further payment under the said Notification, but also deemed it expedient to recover the benefits already availed of by certain consumers including the petitioners in terms of the earlier Notifications, having regard to the fact that the action in issuing the notifications was unauthorized and wholly illegal and that the parties could not be allowed to reap the benefits of an illegal act. It is stated by the respondent State, that, with this intent and object, the State Assembly passed the Bill known as Goa (Prohibition of Further Payments and Recovery of Rebate Benefits) Bill 2002, which was introduced in the House on 16.01.2002. 5. With reference to the principal contention of the petitioners that the Act impugned is unconstitutional and it seeks to nullify the judgment of this Court in G.R. Ispat's case, the State contends that the Act impugned is constitutionally valid and has been passed by the Legislature keeping in view the objects behind the Bill; that even assuming but not admitting in any manner that the impugned Act nullifies the judgment of this Court, the Legislature under the Constitution of India....
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....1 in Writ Petition No. 316 of 1998, which is appealed against and pending in SLP (Civil) No. 4233 of 2001 before this Court. 7. The State also contends, that, the impugned Act is not aimed at giving effect to the Order of the High Court of Bombay dated 19/24.04.2001 in W.P No. 316 of 1998 nor is it passed because the abovementioned Special Leave Petition is pending before this Court, but has been passed and aimed to save the coffers of the State and to prevent further abuse and payment out of the State Funds which the State can ill afford. The State had lost almost an amount of about Rs. 16 Crores and a further sum of Rs. 50 Crores of public money might have to be paid and there was neither any budgetary allocation nor any provision made for such payments and therefore instead of the monies coming into the State Exchequer by way of receipts by Government in accordance with Article 266(1) of the Constitution of India, these payments were sought to be diverted to the private industrialists by virtue of the two notifications mentioned above and with a view to put an end to this illegality the impugned Act has been enacted in the larger public interest to safe the Public Exchequer fro....
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....s illustration have referred to the Judgments of this Court in the case of S.S. Bola v. B.D. Saldhana reported in AIR 1997 Supreme Court 3127 and Indian Aluminium and Ors. v. State Of Kerala reported in 1996 (1) SCC 637. It is reiterated by the State, that, the State Legislature is competent to enact the Act impugned under Entry 38 of List III to the VIIth Schedule of the Constitution of India. 12. The petitioner has filed a rejoinder which reiterates more or less what is stated in the Writ Petition. In short, in the rejoinder the petitioner seeks to counter the reason and other grounds offered by the State Government in support of the Legislation impugned. It also disputes the correctness of certain statements made by the State Government in its affidavit in reply to the Writ Petition. 13. We have heard learned senior counsel Shri F.S. Nariman for the petitioners and Dr. Rajeev Dhavan and Shri Shyam Diwan, learned senior counsel for State of Goa. We also had the advantage of going through several rulings of this Court cited by the learned Counsels. 14. The Act impugned is attacked principally on the ground, that, it seeks to nullify a judgment of this Court dated 13.02.2001, af....
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....n 2], requires recovery [under Section 3] and "extinguishes" all liabilities of the State that accrue or arise from the Notifications dated 15.05.1996 and 01.08.1996. Therefore, no exception can be taken to the constitutionality of the Act impugned, on the ground, that it seeks to undo or reverse any judgment. The Legislature in its competence has enacted the Act to achieve the purposes indicated therein and not to frustrate any judgment of any court including that of this Court. It is to be noted that State Legislature was competent to enact the Act in its present form even before the judgment of the High Court in the PIL and the fact that it has come after the judgment in PIL does not render it unconstitutional on the ground that it seeks to nullify the judgment of this Court in the earlier proceedings. 19. The State, in the factual background leading to the issue of the Notifications dated 15.5.1996 and 01.08.1996 and the filing of Writ Petition No. 316 of 1998 and the judgment of the High Court of Bombay Panaji Bench therein, thought it fit and expedient to prohibit any further payment under the said Notifications and to recover the benefits already availed of by cer....
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....n nor budgetary provision nor cabinet approval as required under Article 166(3) of the Constitution of India and therefore the two notifications dated 15.05.1996 and 01.08.1996 in issue could not be said to be the decision of the State Government in the strict sense of law and the claims for rebate under these Notifications which run into several Crores of Rupees could not be borne by the exchequer, more so when they are devoid of any legal sanctity and that it was impossible for the State to meet or bear such an enormous liability of such a magnitude. The respondent State in its affidavit draws support from certain observations from the Judgment of the High Court of Bombay dated 19/24.04.2001, to say that the Notifications mentioned above were non-est and action taken thereunder was null and void. It is the stand of the State, that, the High Court in W.P. No. 316 of 1998 has also dealt with the issue as to why the State had failed to bring before the High Court in the earlier batch of Writ Petition decided on 21.01.1999, wherein the High Court upheld the power of the State Government to withdraw the rebate by invoking provisions of Section 21 of the General Clauses Act. According ....
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....er and on that premise the High Court had directed the State to pay the amounts and this Court confirmed the same in its Order. What the Legislature seeks to do by the Act impugned is to cure the defect of any kind and thereby to ensure that public funds are not drained and it is in larger public interest that this Act is enacted. The Act which has been passed in the larger public interest and with a view to sub serve the public cause and to prevent abuse of public exchequer and to remedy the fraud played by an individual on the public exchequer and to recover the amounts paid under these two Notifications and to prevent further loss of public funds cannot be termed as unconstitutional. It cannot therefore be said that the Act impugned is aimed at nullifying a judgment of this Court dated 13.02.2001, affirming the view taken by High Court of Bombay Panaji Bench, in its judgment dated 21.01.1999. It can not also be said that the Act impugned seeks to give effect to the decision of the High Court of Bombay dated 19/24th April" 2001, in Writ Petition No. 316 of 1998. 23. The Act stands totally on a different footing and the judgment of the High Court dated 19/24.04.2001 has no b....