LexESSAR STEEL LTD. versus UNION OF INDIA & ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A B c D E F G H [2016] 4 S.C.R. 326 ESSAR STEEL LTD. v. UNION OF INDIA & ORS. (Civil Appeal No. 4610 of2009) APRIL 19,2016 [V. GOPALA GOWDA AND UDAY UMESH LALIT, JJ.) Constitution of India - Arts. 14, 7 3 and Schedule Vil, List I, Entry 53 - Contract for purchase of Regasified Liquified Natural Gas (RLNG) at fixed price - Thereafter, policy decision of the Central Government to pool RLNG prices - Co111munication by the sellers of RLNG to the purchaser (appellant) infor111ing that pursuant to the Govern111ent policy, price of the gas under the contract would be revised - The policy decision found consequent action of unilaterally increasing the price of RLNG - High Court upheld the validity of the policy decision - On appeal, held: Though price fixing is a legislative fzmction, it can be delegated and can be fixed by executive orders as well - RLNG is an essential commodity and parliament having enacted Essential Commodities Act, has left it to the decision of the executive to take steps for fixing the prices of essential commodities - The Union, by virtue of Art. 73 r/w Entry 53 of List I of Seventh Schedule of the Constitution is competent to legislate and take policy decision in relation to the matters relating lo mineral oil resotJ,rces and injlam111able substances, which includes RLNG - The policy decision was taken after due deliberation, in the interest of the public at large - The objective of the policy was to unifY the price of RLNG on a non-discriminatory basis - Moreover, the consumers of RLNG through long term contracts are a class by the111selves for the purpose of Art. 14 of the Constitution - The i111pug11ed decision was to apply to all the players wjthin this class uniformly - Thus the policy decision cannot be said to be discriminatory, arbitrary, illegal, unreasonable or otherwise violative of Ari. 14 of the Constitution - Therefore, the inte1ference with the impugned policy decision is not called for. Judicial Review - Of policy decision regarding com111ercial matters - Permissibility - Held: Court should exercise great caution and restraint when confronted with matters related to the policy 326 ESSAR STEEL LTD. v. UNION OF INDIA & ORS. 327 regarding commercial matters of country - Executive policies are A enacted after much deliberation - Therefore, the courts to interfere with, only when the policy is enacted in arbitrary unreasonable or malafide manner or if it offends the provisions of the Constitution. Constitution of India - Art. 136 - Jurisdiction under - Scope of - Held: Supreme Court, in exercise of its jurisdiction u/Art. 136, B does not have competence to judge the viability of policy decision of the Government. Dismissing the appeals, the Court HELD: 1.1 This Court should exercise great caution and restraint when confronted with matters related to the policy regarding commercial matters of the country. Executive policies are usually enacted after much deliberation by the Government. Therefore, it would not be appropriate for this Court to question the wisdom of the same, unless it is demonstrated by the aggrieved persons that the said policy has been enacted in an arbitrary, unreasonable or nut/a.fide manner, or that it offends the provisions of the Constitution of India. [Para 31) (353-C-D) Peerless General Finance & Investment Co. Ltd. v. Reserve Bank of India 1992 (1) SCR 406 : 1992 (2) sec 343 - followed. Arun Kumar Agrawal v. Union of India 2013 (3) SCR 508 : 2013 (7) SCC 1; Villianur Iyarkkai Padukappu Maiyam v. Union of India 2009 (9) SCR 225: 2009 (7) SCC 561; Narmada Bachao Ando/an v. Union of India 2000 (4) Suppl. SCR 94: 2000 (10) sec 664 - relied on. 1.2 Supreme Court neither has the jurisdiction nor the competence to judge the viability of such policy decisions of the Government in exercise of its appellate jurisdiction under Article 136 of the Constitution of India. fPara 31] 1351-Dl 2.1 By virtue of Article 73 of the Constitution read with Entry 53 of List I of Seventh Schedule to the Constitution, the Union has the power to legislate and take policy decisions in relation to the matters pertaining to mineral oil reso~rces and inflammable substances, which includes RLNG. There is no c D E F G H 328 A B c D E F SUPREME COURT REPORTS [2016] 4 S.C.R. existing legislative provision as far as fixing of the price of RLNG is concerned. Thus, the executive of the Union of India is
Excerpt shown. Read the full judgment & AI analysis in Lexace.