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Report No. 158

The Amendment of The Industries (Development & Regulation) Act, 1951

Chapter 1


1.1. The Scope.-

The Law Commission of India has taken up, suo motu, for consideration the amendment ,of Item 26 in the First Schedule to the Industries (Development & Regulation) Act, 1951 in view of, and with a view to remove the difficulties expressed by the Supreme Court in its various decisions discussed in this Report (Chapter II, infra) in interpreting the Constitutional provisions pertaining to the subject. In a recent decision of the Supreme Court in Coir Board v. Indira Devi P.S., 1998 (2) SCALE 195, paras 20 & 21, the Court noticed the uncertainty prevailing in interpretation of the term 'industry' in Industrial Disputes Act, 1947 despite the decision of the majority of five Judges Bench decision in Bangalore Water Supply and Sewerage Board v. A. Rajappa, (1978) 2 SCC 213, and observed:-

"21. Undoubtedly, it is of paramout importance that a proper law is framed to promote the welfare of labour employed in industries."

In Murari Lal Mahavir Prasad v. B.R. Vad, (1975) 2 SCC 736 it was observed:-

"if the statute contains a lacuna or a loophole, it is not the function of the Court to plug it by a strained construction in reference to the supposed intention of the legislature. The legislature must then step in to resolve the ambiguity and so long as it does not do so the tax payer will get the benefit of that ambiguity; but equally the court ought not to be astute to hunt out ambiguities by an unnatural construction of a taxing section."

A duty is enjoined upon the legislature to frame the appropriate law when the issue becomes complex and thorny and is frequently raised in the courts (see para. 2.2.4, infra) and above all there are inconsistencies in the Supreme Court decisions on the subject (see para. 2.2.5, infra).

The Law Commission is also of the opinion that since clarity and certainty of law has been lacking on the subject dealt with in this report, grave doubts arising in the judicial battlefield, should be removed legislatively, in view of the colossal amount of revenue and manifold activities involved in it viz., power to legislate on liquors, that is to say, production, manufacture, processing, transport, purchase and sale thereof, and licensing, control of supply, distribution, price, fees, duties, etc.

The Amendment of the Industries (Development  Back

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