SHRI RAMTANU CO-OPERATIVE HOUSING SOCIETY LTD. & ANR. versus STATE OF MAHARASHTRA & ORS.

Citation: [1971] 1 S.C.R. 719 · Decided: 05-08-1970 · Supreme Court of India · Bench: M. HIDAYATULLAH · Disposal: Dismissed

Cited by 2 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

719· 
A 
SHRI KAMTANU 
CO-OPERATIVE 
HOUSING SOCffiTY 
LTD. & ANR. 
\', 
STATE OF MAHARASHTRA & ORS. 
11 
August 5, 1970 
c 
D 
E 
F 
G 
H 
[M. HloAYATULLAH, C.J., 
J. M. S!rELAT, 
G. K. MITTER, 
C. A. VAIDIAL!NGAM AND A. N. RAY, JJ.] 
Maharashtra Industrial Development Act, 1961-Maharashtra Deve-
lopment Corporation formed under the Act whether a trading corporatioR-
Legisiative competence-Legislation falls under Entry 24 of the State List 
and not under Entry 43 of Union List-Act is valid-No discriminatio11 
in procedure for acquisition under above Act and Land Reqtdsirion Ac1, 
1894-Proviso to s. 33 of Maharashtra Act does not restrict judicial power 
of Collector in determining compensation. 
. In a petition under Art. 
32 of the Constitution of India the peti-
tioners challenged the validity of the Maharashtra Industrial De>elopmont 
Act, 1961. 
In support of the petition it was contended: (i) that the 
Maharashtra legislature was incompetent to enact the Act because the Act 
was for the incorporation, regulation .and winding up of the Maharashtra 
Development Corporation which was a trading corporation; accordingly 
the impugned legislation fell within Entry 43 of List I (Union List) or 
the Seventh Schedule of the Constitution; (ii) that there was a special 
proeedure designed by the land Acquisition Act for acquisition of la~d for 
tile companies whereas in the present case under the pro,isions of the 
impugned Act the State was acquiring land for companies without adopt-
ing the procedure of the Land Ar,quisition Act and thus there was pro-
cedural discrimination; (iii) that the proviso to s. 33 of the impugned 
Act providing that no compensation exceeding such amount as the State 
Government may by general order specify to be paid for acquisition •hall 
be determined by the Collector without the previous ap!?roval of .the State 
Government or its nominee, was restrictive of the judicial power of the 
Collector. 
HELD : (i) It is the true intent of the Act i.e. jts pith and s~bstance 
which will determine the validity of the Act. Industries come "1thm Entry 
24 of the State List subject to the provision of Entry 7 and Entry 52 of 
the Union list of the Constitution. 
Entry 7 of the Union List relates 
to industries declared by Parliament by law to be necessary for the purpose 
of defence or for the prosecution of war. E~try ~2 of the Umon List _relates 
industries the control of which by the Un•on ts declared .by Parhament 
hy law to be expedient in the public interest. The estabhshment, growth 
and development of industries in the State of Maharashtra does not fall 
within Entry 7 and Entry 52 of the Union List. . Establishmen.t gro~h 
and development of industries in the State 1s. w1thm t_he State List of m-
dustries The pith and substance of the Act ts esta~hshment growth a!'d 
clevelop'.ment of industries, and acquisition of land 1n t!'at behalf cames 
out the purposes of the Act by setting up the Corporation as .one ot :J:: 
limbs or agencies of the Gove~n_ment. The powers and fu~ctt?~s o 
'Xlrporation show in no certam terms that these are all m aid of tiie 
~rincioal and predominant purpose of establishrnthentCoand ~?'vthh of ~'b. 
dustries. When the Government is sa~fied that 
e 
i;por~_ion 
a~ • 11 
stantially achived the purposes for whtch the Cof!'Oration " estab,1she , 
720 
SUPREME COURT REPORTS 
(1971] 1 S.C.R. 
the Corporation will be dissolved because the raison d'etre is gone. It 
A 
must, therefore, be held that the Act is a valid piece of legislation [725 
F-726 DJ 
. 
'The contention that the Corporati~n was a trading one, cir that it was 
a Government company within the meaning of s. 617 of the Companies 
Act, 1956 could not be accepted. [Reason dissussed] 
The true character 
of the Corporation in the present case is to act as an architectural agent 
of the development and growth of industrial towns by establishing and 
developing industrial estates and industrial areas. [727 B-728 F] 
(ii) 'The contention that there was procedural discrimination as between 
the present Act and the Land Acquisition Act could not be accepted. 
'The Maharashtra Industrial Development Act is a· special one ha\ing 
the specific and special purpose of growth, development and organisation 
of industrie8. That Act has its own procedure. Under the Land Acquisi-
tion Act acquisition is at the instance of and for the benefit of a company 
whereas under the present Act acquisition is solely by the State for public

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