THE MANAGING DIRECTOR 0.I.I.D.C., BHUBANESWAR versus SARAT CHANDRA PATNAIK AND ANR.

Citation: [1996] SUPP. 2 S.C.R. 108 · Decided: 30-04-1996 · Supreme Court of India · Bench: K. RAMASWAMY, G.B. PATTANAIK · Disposal: Appeal(s) allowed
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Judgment (excerpt)

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THE MANAGING DIRECTOR 0.1.1.D.C., BHUBANESWAR 
v. 
SARAT CHANDRA PATNAIK AND ANR. 
APRIL 30, 1996 
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IK. RAMASWAMY AND G.B. PATTANAIK, JJ.] 
Olissa I11dustlial I11frastmcture Development C01poratio11 Act, 1980: 
Sections 4, 18, 33, 49-Board co11stituted for tlze ma11ageme11t of the 
C affairs of tlze busi11ess of the Corporatio11-State Government to place a11y 
industrial area or indust1iaf estate under the nianagcn1ent and control of the 
Corporatio11-Plot offered i11 one such i11dustrial arca-Respo11dent-allottee 
i11itial/y accepti11g tlze allotment-Later filing wlit petition for a direction to 
reduce the a111ount fzxed under the lease-Reliance jJ/aced on the intenial 
co1re.":Jpondence ivith the Govenunent-High Court directing to place the 
D matter before tlze Govemment for final decision-Held, High Cowt was not 
n'ght in giving the direction as it would appear that tile Govenunent had 
exceeded its power under S. 18 r/w S.33 of the Act-Re;pondent to pay the 
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balance a1nount lvithin six 111onths. 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 8661 of 
1996. 
From the Judgment and Order dated 18.8.92 of the Orissa High 
Court in O.J.C. No. 779 of 1989. 
J anaranjan Das for the Appellants. 
S.K. Jain for Jain Hansaria & Co. for the Respondents. 
Ms. Kirti Misra for the State. 
The following Order of the Court was delivered : 
Leave granted. 
We have heard learned counsel on both sides. 
This appeal by special leave arises from the order of the Division 
H Bench of the High Court of Orissa, Cuttack Bench made in OJC No. 
108 
MANAGING DIRECTOR, O.II.D.C. v. S.C. PATTANAIK 
109 
779/89. Admittedly, the appellant-Corporation was constituted under the A 
Orissa Industrial Infrastructure Development Corporation Act, 1980 (for 
short, the 'Act'). The Board has been constituted for the management of 
the affairs of. the business of the Corporation. Section 49 of the Act 
empowers the State Government to place any industrial area or industrial 
estate under the management and control of the Corporation. In fur-
therance thereof, certain plots have been offered for allotment in the 
industrial areas. The respondent is one on the offerees to accept the plot. 
By letter dated August l, 1987, the appellant had offered the shed for 90 
years lease for the consideration mentioned thereunder. The respondent, 
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by letter dated September 3, 1987, accepted the offer and requested to 
transfer the plot in his favour. In furtherance thereof, the plot came to be C 
allotted. Subsequently, relying upon the internal correspondence between 
the Government and the respondent and the letter of the Government 
dated 14.10.1980, the respondent filed a writ petition in the High Court 
seeking direction to reduce the amount fixed under the lease. The High 
Court in the impugned order directed to place the matter before the D 
Government for final decision in the light of the directions. 
The question, therefore, is whether the view of the High Court is 
correct in law ? Section 4 of the Act vests the general superintendence, 
directions and management of affairs and business of the Corporation in 
the Board of Directors subject to the powers issued by the Government E 
under Section 18 which reads as under : 
"18. The St.ate Government may issue to the Corporation such 
general or special directions as to policy as it may think necessary 
or expedient for carrying out the purposes of this Acts, and the 
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Corporation shall be bound to follow and act upon such direc-
tions.11 
Section 33 which is sought to be relied on by the counsel for the 
respondent also contemplates that certain directions be given by the State G 
Govetnment to the Corporation in the way for disposal of the land ac-
quired by the Government and transfer to it without undertaking or carry-
ing out any development thereon. Such directions would not be construed 
a routine administrative direction in the day to day administration of the 
Corporation. It must be read along with Section 18 in which the Govern-
ment have been given power to give special or general directions as a policy H 
110 
SUPREME COURT REPORTS [1996] SUPP. 2 S.C.R. 
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guideline in the management of the Board and also disposal of the proper-
ties. Otherwise, the very authority gets eroded and it would becone a wing 
of the Government Department which does not appear to be the object of 
the Act. The letter which was relied on by the respondent would indicate 
as if the State has assumed t
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