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Supreme Court of India

UTKAL CONTRACTORS & JOINERY (P) LTD. & ORS.versusSTATE OF ORISSA

Citation
1987 INSC 265
Decided
24 September 1987
Disposal
Dismissed

Holding

The Orissa Forest Produce (Control of Trade) (Amendment and Validation) Ordinance, 1987 is a valid exercise of legislative power and does not unlawfully encroach upon judicial authority.

Summary

The petitioners, holders of long‑term licences to collect sal seeds from forest divisions in Orissa, challenged a 1982 State notification that they claimed rescinded their royalty contracts. The Supreme Court had earlier held that the 1981 Forest Produce Act and the notification did not apply to forest produce grown in Government forests, so the contracts remained valid. In 1987 the Governor issued an Amendment and Validation Ordinance that retrospectively amended the Act to include forest produce on State lands, rescinded existing contracts and validated the 1982 notification. The petitioners filed writ petitions contending that the Ordinance was unconstitutional, encroached on judicial power and was an impermissible retrospective law. The Court held that the Ordinance was a valid exercise of legislative competence under Articles 245 and 246, that the State may create monopolies in trade, that retrospective legislation is permissible, and that validation of a notification does not amount to an unlawful encroachment on judicial power. Consequently, the petitions were dismissed.

Issues considered

  • The constitutional validity of the Orissa Forest Produce (Control of Trade) (Amendment and Validation) Ordinance, 1987, including its retrospective effect.
  • Whether the State may legislate to create a monopoly in the trade of forest produce under Articles 19, 245 and 246 of the Constitution.
  • Whether the executive's statement of objects and reasons can limit the plain meaning of statutory language.
  • Whether validation of a prior notification by the Ordinance infringes upon the judicial power of the courts.

Legislation cited

Subjects

State monopolyLegislative competenceRetrospective legislationValidation of notificationForest produceArticle 19(6)Article 245Article 246Judicial powerStatutory interpretationContract rescission

Judgment

       UTKAL CONTRACTORS & JOINERY (P) LTD. & ORS.
A                          v.
                    STATE OF ORISSA

                             SEPTEMBER 24, 1987

B                      [O. CHINNAPPA REDDY AND
                      K. JAGANNATHA SHETTY, JJ.]

          Constitution of India: Articles 19, 32, 245 and 246-Laws
    for creating State monopolies either partially or complete in respect
                                                                                           ...
    of any trade/business/industry/service-Whether State empowered
c   to make-Laws relating to trading activities-Whether can be pre-
    sumed to be reasonable and in general public interest-Legislation
    rendering judicial decision ineffective by enacting valid law-
    Whether Legislature competent to enact-Whether such law can be
    retrospective.
D
         Orissa Forest Produce (Control of Trade) Amendment and
    Validation Ordinance, 1987: Sections 1 to 5-0rdinance pro-
    mulgated to render ineffective Supreme Court's decision striking
    down 1981 Act-Validity of-Whether encroachment on judicial
    power-Notification validated by ordinance-Effect of.                          )-
E
          Statutory Interpretation: Executive Policy/Statement of Objects
    and Reasons of Act/Ordinance-Whether can control actual words                          -
    used in the legislation.

F          The Orissa Forest Produce (Control of Trade) Act, 1981 was             1. ~
    enacted to prevent smuggling forest produce and also to provide State         ~-
    monopoly in such forest produce. The State was empowered under
    section 1(3) of the Act, from time to time to issue a notification specify-
    ing the area or areas, the forest produce in relation to which and the
    date from which the Act shall come into force. The State Government
G   issued a notification dated December 9, 1982 directing that the Act shall
    come into force at once in the whole of the State of Orissa in relation to
    sat seeds.                                                                    ,.....


      The petitioners were holders of long term license from the
H Government for collection of sal seeds from certain specified forest

                                       314
                  UTKAL CONTRACTORS v. STATE OF ORISSA                     315

    divisions on payment of royalty. Consequent upon the issue of the above       A
    notification, the Government refused to accept royalty from the peti-
    tioners in respect of certain forest divisions on the ground that the
    notification had the effect of rescinding the existing contracts between
    the Government and the petitioners.

          The petitioners thereupon filed writ petitions before the High          B
    Court for a declaration that the above notification was void, and did not
    have the effect of rescinding their contracts in relation to sal seeds. The
    High Coort dismissed the writ petitions. The Supreme Coor!, allowing
    the appeals of the petitioners, held that the Act and the notification
    issued thereunder did not apply to forest produce grown in Government
    forests and that it was not, therefore, open to the Government to treat       C
    the contract dated May 25, 1979, as rescinded.

         On May 29, 1987, the Governor of Orissa promulgated Orissa
    Forest Produce (Control of Trade) (Amendment and Validation) Ordi-
    nance 1987 deeming it to have come into force with effect from
    September 5, 1981, when the principal Act was notified in the Gazette, D
    rendering the aforesaid decision ineffective.

         The petitioners challenged the validity of this Ordinance in this
    Court.

          Dismissing the writ petitions, this Court,                              E



-         HELD: 1.1. The impugned Ordinance is valid and cannot be
    challenged on any ground. [327Bl

          1.2 The object to the Act was to prevent smuggling and to provide
    for State monopoly in the specified forest produce and not to provide         F
    State monopoly only to prevent smuggling. The validity of the statutory
    notification cannot be judged merely on the basis of statement of objects
    and reasons accompanying the Bill. Nor could it be tested by the
    Government policy from time to time. [3J8Bl

           The executive policy of the Government or the statement of G
     objects and reasons of the Act or Ordinances cannot control the words
     used in the legislation. [323F l

           Central Bank of India v. Their Workmen, [1%0) l SCR 200 and
     State of West Bengal v. Union of India, (1964) 1 SCR 371 at p. 382,
     relied on.                                                                   H
     316                    SUPREME COURT REPORTS             [1988] I S.C.R.

            1.3 It is open to the State to make laws for creating State mono-
A
     polies either partially or complete in respect of any trade or business or
     industry or service. The State may enter into trade like any other
     person either for administrative reasons or with the object of mitiga-
     ting the evils in the trade, or even for the purpose of making profits in
     order to enrich the State exchequer. The law relating to such trading
B    activities must be presumed to be reasonable and in the interest of
     general public. [3240-E]

          Akadasi Padhan v. State of Orissa, 11963] 2 Supp. SCR 691,
    relied on.

          1.4 The legislature may, at any time, in exercise of the plenary
c   power conferred on it by Articles 245 and 246 of the Constitution ren-
    der a judicial decision ineffective by enacting a valid law. There is no
    prohibition against retrospective legislation. The power of the legisla-
    ture to pass a law postulates the power to pass it prospectively as well as
    retrospectively, subject, of course, to the legislative competence and
o   other constitutional limitation. 1325E-FI

          1.5 The rendering ineffective of judgments or orders of compe-
    tent Courts by changing their basis by legislative enactment is a well-
    known pattern of all validating acts. Such validating legislation which
    removes the cause of ineffectiveness or invalidity of action or proceed-      )...
E   ings cannot be considered as encroachment on judicial power. The
    legislature, however, cannot by a bare declaration, without more,
    directly overrule, reverse or set aside any judicial decision. 1325F-G I

         In the instant case, having regard to the then existing provisions
  of the Act, this Court declared that the Act and notification issued
F thereunder in relation to sal seeds did not apply to sat seeds grown in
                                                                                         -
  Government forests. The Act has been suitably amended by the
  impugned Ordinance by removing the cause of ineffectiveness pointed
  out by this Court. The definition of "forest produce" under section 2(c)
  has been enlarged to include, among others, sal seeds, grown or found
  on Government lands or in Government forests. Clause (a) of sub-
G section (1) of section 5 has been substituted covering all contracts for the
  purchase, sale, gathering or collection of 'specified forest produce'
  grown or found in the area specified in the notification issued under
  section 1(3) of the Act. Such contracts shall stand rescinded when a
  notification under s. 1(3) of the Act is issued. Both these provisions shall
  be deemed to have come into force with effect from September 5, 1981,
H the date on which the Act had come into force. 1326A-B, E-FI
        UTKAL CONTRACTORS v. STATE OF OR!SSA [SHETIY ,J.]             317

      The notification dated December 9, 1982 has been validated under A
section 5 of the Ordinance nl)lwithstanding any judgment, decree or
order of any Court to the contrary. It shall be deemed to have been
issued in reS);leCt of sat seeds also grown or found in Government
forests. It shall be valid and effectual as if it were issued under section
1(3) of the Act as amended by the Ordinance. This. validation is more
than sufficient to make it operative to cover the contracts of the B
petitioners. It does not suffer from any infirmity. [32611; 327 A-Bl

       1.6 It would be impermissible for the State to enter into such con-
tracts in future. The parties or Agents employed by the State cannot work
for their own benefits. They must work on behalf of tlte State. l324F-G)

      Utkal Contractors & Joinery Pvt. Ltd. and Ors. v. State of Orissa C
& Ors., AIR 1987 SC 1455-[19871 3 SCC 279; Hari Singh & Ors. v.
The Military Estate Officer & Anr., [1973] 1 SCR 515; Government of
Andhra Pradesh & Anr. v. Hindustan Tools Ltd., [1975] Supp. SCR
394; V.N. Saxena v. State of M.P., [1976] 3 SCR 237 and Misri Lal Jain
Etc. v. State of Orissa & Anr., [1977] 3 SCR 714, referred to.          D

        ORIGINAL JURISDICTION: Writ Petition Nos. 7597-99 of
1983.

                                    And
                                                                             E
        Writ Petition Nos. 7606-09 of 1983.

        (Under Article 32 of the Constitution of Indi~).

     A.K. Sen, F.S. Nariman, S.N. Kacker, A.K. Ganguli, R.F.
Nariman, A. Patnaik and M.M. Kshatriya for the Petitioners.                  F

     Shanti Bhushan, S.N. Chatterjee, G.L. Sanghi, Dr. Y.S.
Chitale, G. Rath, Advocate General, R.K. Patra, R.K. Mehta and
H.K. Puri for the Respondents.

        The Judgment of the Court was delivered by                           G

     JAGANNATHA SHETTY, J. "Sal seed" which is a minor forest
produce at Orissa has again become the major subject of litigation
between commercial users and the State of Orissa.
                                              1
        The petitioners herein are holders of long term license from the     H
    318                   SUPREME COURT REPORTS           [1988] 1 S.C.R.

    Government of Orissa for collection of sal seeds from certain
A specified forest divisions on payment of royalty. The State of Orissa
    enacted Orissa Forest.Produce (Control of Trade) Act, 1981 (The
    "Act"). It received the assent of President on August 21, 1981. The
    object of the Act was to prevent smuggling forest and also to
    provide State monopoly in such forest produce. Under Section 1(3)
    of the Act the State is empowered from time to time to issue a noti-
    fication specifying the area or areas the forest produce in relation
    to which and the date from which the Act shall come into force.
    Purporting to act under this provision a notification dated
    December 9, 1982 was issued by the State Government directing
    that the Act shall come into force at once in the whole of the State
    of Orissa in relation to sal seeds. Thereafter, the Government
c   refused to accept royalty from the petitioners in respect of certain
    forest divisions on the ground that the notification had the effect of
    rescinding the existing contracts between the Government and the
    petitioners. The petitioners thereupon moved the Orissa High
    Court with Writ Petitions for declaration that the said notification
D   was void and did not have the effect of rescinding their contracts in
    relation to sal seeds. The Orissa High Court dismissed the Writ
    Petitions. The matter was brought before this Court in Civil Appeal
    Nos. 6230-31 of 1983. This Court allowed the appeals by judgment
    dated May 5, 1987, which has been since reported in Utkal
    Contractors & Joinery Pvt. Ltd. and Ors. v. State of Orissa and
E   Ors., AIR 1987 SC 1455 = 1987 (3) sec 279.

          The nub of the arguments in those appeals was that the Act was
    not concerned with the sal seeds grown in the Government lands or
    Government Forests, and in any event, the petitioners' contract re-
    mained untouched by the notification dated December 9, 1982. It was
F   also contended that since the Government was already the owner of
    forest produce in Government lands, all that was necessary to create a
    State monopoly in any forest produce, was to vest in the Government
    the exclusive right to such forest produce grown in private holding.
    After dealing with the object of the Act and relevant provisions, a
    bench of this Court consisting one of us (0. Chinnappa Reddy, J.)
G   said:

               "Thus none of these provisions deals with forest produce
               grown in Government lands nor is there any other provi-
               sion in the Act which expressly deals with forest produce
H              grown in Government lands. The scheme of the Act is,
          UTKAL CONTRACTORS v. STATE OF ORISSA [SHETTY ,J.]            319

    ~-        therefore, fully in tune with the object set out in the State-
                                                                               A
              ment of Objects and Reasons and in the Preamble, namely
              that of creating a monopoly in forest produce by making
              the Government the exclusive purchaser of forest produce
              grown in private holdings. It as argued by the learned
              Additional Solicitor General that S. 5(1)(1) was totally out
              of tune with the rest of the provisions and, while the rest of B
              the provisions dealt with forest produce grown in private
"t            holdings the very wide language of S. 5(1)(a) made it
              applicable to all forest produce whether grown in private
.:            holdings or Government forests. We do not think that it is
              permissible for us to construe S. 5(1)(a) in the very wide
              terms in which we are asked to construe it by the learned
              Additional Solicitor General because of its wide language, c
~   )-        as that would merely introduce needless confusion into the
              scheme of the Act. Having scanned the object and the
              scheme of the Act, having examined each of the provisions
              of the Act textually and contextually, we do not think it is
              proper for us to construe the words of S. 5(1)(a) in their D
              literal sense; we think that the proper way to construe.
              S. 5(l)(a) is to give a restricted meaning to the wide and
              general words there used so as to fit into the general
              scheme of the Act and S. 5(1)(b) are concerned by the
              conjunction 'and', and having regard to the circumstances
               leading to the enactment and the policy and design of the E
               Act, we think that clauses (a) and (b) must be construed in
               such a way as to reflect each other. We have no doubt that

--             the contracts relating to specified foresl produce which
               stand rescinded are contracts in relation to forest produce
               grown in private holdings only. If the very object of the Act
               is to create a monopoly in forest produce in the Govern- F
               ment so as enable the Government, among other things, to
     -f        enter into contracts, there was no point in rescinding con-
               tracts already validly entered into by the Government.
               Again S. 5(1) does not bar any future contracts by the
               Government in respect of forest produce; if so, what is the
               justification for construing S. 5(1) in such a way as to put an G
               end to contracts already entered into by the Government.
               Viewing S. 5(1)(a) and S(l)(b) together and in the light of
               the preamble and the Statement of Objects and Reasons
               and against the decor of the remaining provisions of the
               Act, we have no doubt that S. 5(1) like the rest of the
               provisions applied to forest produce grown in private hold- H
    320                   SUPREME COURT REPORTS            [1988] 1 S.C.R..

               ings and not to forest produce grown in Government
A
               lands."

          Then the conclusion was expressed in the following terms:

               "We declare that the Act and the notification issued undet
B              the Act do not apply to forest produce grown in Govern-
               ment forests and that it was not, therefore, open to the
               Government to treat the contract dated May 25, 1979, as
               rescinded."

        On May 29, 1987, the Governor of Orissa promulgated Orissa
  Forest Produce (Control of '.frade) (Amendment and Validation)
C Ordinance, 1987, (The "Ordinance"). The Ordinance shall be deemed             'J
  to have come into force "with effect from September 5, 1981 when the         ~
  principal Act was notified in the Orissa Gazette. The Ordinance
  purports to render the aforesaid decision ineffective. The petitioners
  have again approached this Court challenging the validity of the
O Ordinance.

          Before we examine the contentions raised in these petitions, it
    will be useful to set out the provisions of Ordinance:

                    "(2) It shall be deemed to have come into force on
E              the date on which the Orissa Forest Produce (Control of
               Trade) Act 1981 (hereinafter referred to as the principal
               Act) had come into force, i.e. 5.9.1981 when the principal
               Act was notified in the Orissa Gazette.

                      2. 3.In clause (c) section 2 of the principal Act, the
                                                                                   -
F              full stop at the end of the clause shall be substituted by a
               comma and thereafter the following shall be added at the        )--.
               end, namely:-

                     "Whether grown or found on land owned by private
                     persons or on land owned by the State Government
G                    or in Government forests."

                     3. In Section 5 of the principal Act, in sub-section
               (I~                                                             ~

                     "(i) for clause (a) the following clause shall pe sub-
H                    stituted, namely:-
        UTKAL CONTRACTORS '· STATE OF ORISSA [SHETTY ,J.]          321

                 "(a) all contracts for the purchase, sale, gathering or A
                 collection of specified forest produce grown or found
                 in the said area shall stand rescinded, whether such
                 forest produce is grown or found on land owned by
                 private persons or on land owned by the State
                 Government or in Government forests."
                                                                         B
                 (ii) After Explanation III, the following Explanation
                 shall be added, namely:-


-                       "Explanation IV-The Explanations I to III
                  shall be deemed to be explanations to clause (b) of
                  this sub-section only and shall not be deemed as in
                  any manner qualifying or detracting from clause (a) C
                  of this sub-section or saving any contracts referred to
                  in clause (a) from the operation of the provision for
                  recission of contracts contained in the said clause
                  (a)".
                                                                           D
                  4. In sectica 9 of the principal Act for sub-section (4)
            the following sub-section shall be substituted namely:-

                 "(4) The State Government or its authorised officer
    j            or agent shall be entitled to take delivery of any
                 sppecified forest produce collected by any person        E
                 from land owned by the State Government or


-                Government Forests on payment of only such collec-
                 tion charges as may be determined by the State
                 Government from 'time to time.

            Provided that it shall be open to the State Government or F
            the authorised officer or agent to refuse to take delivery of
            any such forest produce which is not fit for consumption or
            use as raw-material for manufacture or for trade:

                   Provided further that in the case of any dispute, the
             Divisional Forest Officer or such other officer who may be G
             specifically empowered in this behalf, as specified in sub
             section (2), shall hear and dispose of the same in the man-
             ner provided in this Act and the Rules made thereunder."

             5. Notwithstanding any judgment, decree or order of any
             Court to the contrary, the Notification dated the 9th         H
    322                   SUPREME COURT REPORTS              [1988] 1 S.C.R.

               December, 1982, issued by the State Government under
A
               sub-section (3) of section I of the principal Act in respect of
               sal seeds shall be deemed to have been issued in respect of
               sal seeds whether grown or found on land owned by private
               persons or on land owned by the State Government or in
               Government forests and shall be as valid and effectual as if
B              it were issued under sub-section (3) of section 1 of the
               principal Act as amended by this Ordinance and all instruc-
               tions and orders issued or made and all actions taken or


                                                                                     -
               things done pursuant to the said Notification in respect of
               sale, purchase and collection of sal seeds shall be deemed
               to have been validly made, taken or done under the princi-
               pal Act as amended by this Ordinance."
c
          Section 2( c) of the Act has now been enlarged to include forest
    produce whether grown or found on land owned by private persons or
    on land owned by the State Government or in Government forests.

D         Section 5 of the Act has been amended to nullify all existing
    private contracts in relation to specified forest produce. It reads:
               "5. Restriction on the purchase and transport and rescis-
               sion of subsisting contracts.

               ( 1) On the issue of a notification under sub-S. (3) of S. I in
E              respect of any area-

               (a) All contracts for purchase, sale gathering or collection
               of specified forest produce grown or found in the said area
               shall stand rescinded, whether such forest produce is grown
               or found on land owned by the State Government or in
                                                                                     -
F              Government forests,
               (b) No person, other than
                    (i) the State Government,

                    (ii) an officer of the State Government authorised in
G                        writing in that behalf; or

                   (iii) an agent in respect of the unit in which the
                         specified forest produce is grown or found              r
                   shall purchase or transport any specified forest
H                  produce in the said area.
UTKAL CONTRACTORS v. STATE OF ORISSA (SHEITY ,J.]   323
    324                    SUPREME COURT REPORTS             [1988] 1 S.C.R.

                cannot be used except for the limited purpose of under-
A
                standing the background and the antecedent state of affairs
                leading up to the legislation. But we cannot use this state-
                ment as an ai<l'to the construction of the enactment or to
                how that the legislature did not intend to acquire the
                proprietary rights vested in the State or in any way to affect
B               the State Governments' rights as owner of minerals. A
                statute, as passed by Parliament, is the expression of the       ··~
                collective intention of the legislature as a whole, and any
                statement made by an individual, albeita a Minister, of the
                intention and objects of the Act cannot be used to cut down
                the generality of the words used in the Statute."
c        The petitioners cannot also contend that the annulment of their
  contracts and the restrictions brought about on their rights to trade are
  unreasonable or arbitrary. Such restrictions must be presumed to be
  reasonable and in the interest of general public. It is open to the State
  to make laws for creating State monopolies either partially or comp-
D lete in respect of any trade or business or industry or service. The State
  may enter into trade like any other person either for administrative
  reasons or with the object of mitigating the evils in the trade, or even
  for the purpose of making profits in order to enrich the State exche-
  quer. The law relating to such trading activities must be presumed to
  be reasonable and in the interest of general public. That was the view
E taken by this Court in Akadasi Padhan v. State of Orissa, [1963] 2
  Supp. SCR 691 where it was observed that the law relating to such




F
  state monopoly should be presumed to be reasonable and in the
  interest of general public within the scope of Article 19(6)(ii) of the
  Constitution.

        As to the contention of Mr. Nariman, that the provisions of the
                                                                                  -
  Act and the Rules made thereunder do not bar future contracts the
  like of which the petitioners are having, we may say that it would be
  impermissible for the State to enter into such contracts hereafter-
  wards. The parties or Agents employed by the State cannot work for
  their own benefits. They must work on behalf of the State. That is
G what has been stated inAkadasi Padhan v. StateofOrissa, (Supra).

               "It seems to us that when the State carries on any trade,
               business or industry it must inevitably carry it on either
               departmentally or through its officers appointed in that be-
               half. In the very nature of things, the States as such, cannot
H              function without the help of its servants or employees and
               UTKAL CONTRACTORS v. STATE OF ORISSA [SHETIT ,J.]           325

                    that. inevitably introduce the concept of agency in a narrow A
                    and limited sense. If the State cannot act without the aid
                    and assistance of its employees or servants, it would be
                    difficult to exclude the concept of agency altogether. Just
                    as the State can appoint a public officer to carry on the
                    trade or its business so can it appoint an agent to carry on
                    the trade on its behalf. Normally and ordinarily, the trade B
                    should be carried on departmentally or with the assistance
                    of public servants appointed in that behalf. But there may
                    be some trade or business in which it would be inexpen-
                    dient to undertake the work of trade or business depart-
                    ment or with the assistance of State servants. In such cases,
                    it would be open to the State to employ the services of
                    agents, provided the agents work on behalf of the State and C
                    not for themselves."

               The next question to be considered is whether the State while
         purporting to amend the Act has encroached upon the judicial power
         and set aside the binding judgment of this Court. We do not think that   o
         Mr. Nariman was justified in contending so. The principles have been
         well established in a string of decisions of this Court, and we may
         briefly summarise as follows:

                    The legsilature may, at any time, in exercise of the plenary
                    power conferred on it by Articles 245 and 246 of the E
                    Constitution render a judicial decision ineffective by enact-


-                   ing a valid law. There is no prohibition against retrospec-
                    tive legislation. The power of the legislature to pass a law
                    postulates the power to pass it prospectively as well as
                    retrospectively. That of course, is subject to the legislative
                    competence and subject to other constitutional limitation. F
                    The rendering ineffective of judgments or orders of compe-
                    tent Courts by changing their basis by legislative enactment
                    ls a well known pattern of all validating acts. Such validat-
                    ing legislation which removes the causes of ineffectiveness
                    or invalidity of action or proceedings cannot be considered
                    as encroachment on judicial power. The legislature, how- G
                    ever, cannot by a bare declaration, without more, directly
                    overrule, reverse or set aside any judicial decision.
·····~
    "    [Hari Singh & Ors. v. The Military Estate Officer & Anr., [1973] 1 SCR
         515; Government of Andhra Pradesh & Anr. v. Hindilstan Tools Ltd.,
         (1975] Supp. SCR 394; V.N. Saxena v. State of M.P., [1976] 3 SCR 237     H
     326                   SUPREME COURT REPORTS             (1988] 1 S.C.R.

A    and Misri Lal Jain Etc. v. State of Orissa &Anr., [1977] 3 SCR 71.]           )(.

         In the instant case having regard to the then existing provisions of
    the Act, this Court declare .. that the Act and notification issued there-
    under in relation to sal seeds did not apply to sal seeds grown in
    Government forests. The Act has been suitably amended by the. im-
B   pugned Ordinance by removing the cause of ineffectiveness pointed
    out by this Court. The new provisions would' now cover specified forest
                                                                                    '(~
    produce whether grown or found on land owned by private persons or
    on land owned by the State Government or in Government forests and
    the contracts relating thereto. Such contracts shall stand rescinded                 ~
    when a notification under Section 1(3) of the Act is issued.
c          What remains to be considered is, whether it is necessary for the
     Government to issue a fresh notification under Section 1(3) of the Act.      -{
     Mr. Nariman contended that the notification issued on December 9,
     1982 was held to be applicable only to sal seeds grown in the private
     holdings, and in the absence of amendment to section 1(3), the valida-
D   tion of such a notification would not be effective to nullify the con-
    tracts which the petitioner~ are having. It was also urged that the
    notification was "still born" and could not have been validated. We
    are unable to accept this contention also. The definition of "forest
    produce" under Section 2(c) has been enlarged to include among
    others, sal seeds, grown or found on Government lands or in Govern-
E   ment forests. Clause (a) of Sub-section (1) of Section 5 has been
    substituted covering all contracts for the purchase, sale, gathering or       "
                                                                                      -
    collection or 'specified forest produce' grown or found in the area
    specified in the notification issued under Section 1(3) of the Act. Both
    these provisions shall be deemed to have come into force with effect
    from September 5, 1981 the date on which the Act had come into
F   force. The notification dated December 9, 1982 issued under Section
    1(3) of the Act reads:
                                                                                 )----
               "SRO No. 852/82-ln exercise of the powers conferred by
               sub-section(3) of Section 1 of the Orissa Forest Produce
               (Control of Trade) Act, 1981 (Orissa Act 22 of 1981), the
G              State Government do hereby direct that the Act shall come
               into force at once in the whole of the State of Orissa in
               relation to sal seeds."                                           ,_
       This notification has been validated under Section 5 of the Ordi-
  nance notwithstanding any judgment, decree or order of any Court to
H the contrary. It shall be deemed to have been issued in respect of sal
                  UTKAL CONTRACTORS v. STATE OF ORISSA [SHETIY ,J.]             327

 )( ·       seeds also grown or found in Government forests. It shall be valid and A
            effectual as if it were issued under Section 1(3) of the Act as amended
            by the Ordinance. This validation, in our opinion is more than suffi·
            cient to make it operative to cover the contracts of the petitioners. It
            does not suffer from any infirmity.

                 The impugned Ordinance is, therefore, valid and cannot be cha!·
                                                                                       B
---y·       lenged on any ground.

                  In the result, these petitions fail and are dismissed, but we make
            to order as to costs.

            N.P.V.                                              Petitions dismissed.   C




        I
    ..J.




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