Odisha HRD

Odisha CM responds to the High Court judgment on Vedanta University land acquisition; time for us to take action in support of this

November 25th, 2010

Update 5: The companies act of 1956 is at http://www.vakilno1.com/bareacts/companiesact/companiesacts.htm.

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Update 4: The land acquisition act is given at http://dolr.nic.in/hyperlink/acq.htm. Following are the excerpts on the whole section on land acquisition for companies, including Section 40 referred below.

PART VII

Acquisition of Land for Companies

38. [Company may be authorized to enter and survey]. Rep. by the Land Acquisition (Amendment) Act, 1984 (68 of 1984), s.21.

[38A. Industrial concern to be deemed Company for certain purposes. – An industrial concern, ordinarily employing not less than one hundred workmen owned by an individual or by an association of individuals and not being a Company, desiring to acquire land for the erection of dwelling houses for workmen employed by the concern or for the provision of amenities directly connected therewith shall, so far as concerns the acquisition of such land, be deemed to be a Company for the purposes of this Part, and the references to Company in [selections 4, 5A, 6, 7 and 50] shall be interpreted as references also to such concern]

39. Previous consent of appropriate Government and execution of agreement necessary. – The provisions of [sections 6 to 16 (both inclusive) and sections 18 to 37 (both inclusive)] shall not be put in force in order to acquire land for any company [under this Part], unless with the previous consent of the [appropriate Government], not unless the Company shall have executed the agreement hereinafter mentioned.

40. Previous enquiry. – (1) Such consent shall not be given unless the [appropriate Government] be satisfied. [either on the report of the Collector under section 5A, sub-section (2), or] by an enquiry held as hereinafter provided, –

[(a) that the purpose of the acquisition is to obtain land for the erection of dwelling houses for workmen employed by the Company or for the provision of amenities directly connected therewith, or

[(aa) that such acquisition is needed for the construction of some building or work for a Company which is engaged or is taking steps for engaging itself in any industry or work which is for a public purpose, or]

(b) that such acquisition is needed for the construction of some work, and that such work is likely to prove useful to the public].

(2) Such enquiry shall be held by such officer and at such time and place as the [appropriate Government] shall appoint.

(3) Such officer may summon and enforce the attendance of witnesses and compel the production of documents by the same means and, as far as possible, in the same manner as is provided by the [Code of Civil Procedure, 1908 (5 of 1908)] in the case of a Civil Court.

41. Agreement with appropriate Government. – If the [appropriate Government] is satisfied [after considering the report, if any, of the Collector under section 5A, sub-section (2), or on the report of the officer making an inquiry under section 40] that [the proposed acquisition is for any of the purposes referred to in clause (a) or clause (aa) or clause (b) of sub-section (1) of section 40], it shall require the Company to enter into an agreement [with the [appropriate Government]], providing to the satisfaction of the [appropriate Government] for the following matters, namely :-

(1) the – [payment to the [appropriate Government]] of the cost of the acquisition;

(2) the transfer, on such payment, of the land to the Company.

(3) the terms on which the land shall be held by the Company,

[(4) where the acquisition is for the purpose of erecting dwelling houses or the provision of amenities connected therewith, the time within which, the conditions on which and the manner in which the dwelling houses or amenities shall be erected or provided;

[(4A) where the acquisition is for the construction of any building or work for a Company which is engaged or is taking steps for engaging itself in any industry or work which is for a public purpose, the time within which, and the conditions on which, the building or work shall be constructed or executed; and]

(5) where the acquisition is for the construction of any other work, the time within which and the conditions on which the work shall be executed and maintained and the terms on which the public shall be entitled to use the work.]

42. Publication of agreement. – Every such agreement shall, as soon as may be after its execution, be published in the official Gazette, and shall thereupon (so far as regards the terms on which the public shall be entitled to use the work) have the same effect as if it had formed part of this Act.

43. Section 39 to 42 not to apply where Government bound by agreement to provide land for Companies. – The provisions of sections 39 to 42, both inclusive, shall not apply and the corresponding sections of Land Acquisition Act, 1870 (10 of 1870), shall be deemed never to have applied, to the acquisition of land for any Railway or other Company, for the purposes of which, [under any agreement with such Company, the secretary of State for India in Council, the Secretary of State, [the Central Government or any State Government] is or was bound to provide land].

44. How agreement with Railway Company may be proved. – In the case of the acquisition of land for the purpose of a Railway Company, the existence of such an agreement as is mentioned in section 43 may be proved by the production of a printed copy thereof purporting to be printed by order of Government.

[44A. Restriction on transfer, etc. – No Company for which any land is acquired under this Part shall be entitled to transfer the said land or any part thereof by sale, mortgage, gift, lease or otherwise except with the previous sanction of the appropriate Government.

44B. Land not to be acquired under this Part except for certain purpose for private companies other than Government companies. – Notwithstanding anything contained in this Act, no land shall be acquired under this Part, except for the purpose mentioned in clause (a) of sub-section (1) of section 40, for a private company, which is not a Government company.

Explanation. – "Private company" and "Government company" shall have the meaning respectively assigned to them in the Companies Act, 1956 (1 of 1956).] 

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Update 3: Following are excerpts from a report in Pioneer.

The dispute was over whether the Anil Agarwal Foundation is a private company or a public company in terms of the provisions of the Companies Act, 1956. The Court held that the acquisition of land in favour of the Foundation is not permissible, except for some limited purposes enumerated under Section 40(1)(a) of the Land Acquisition Act, since it is a private company.

The Chief Minister, however, countered the Court’s stand by stating, “In this connection I may point out that acquisition was never made under this aforesaid provision but under Section 40(1) (aa) or 40 (l) (b) for a public purpose, the acquisition being for the purpose of setting up a university… As the Government has accepted, based on the records, that the Foundation is a Public Company, land acquisition for an educational purpose like for the proposed world class university would be permissible under the Land Acquisition Act, 1894.”

Replying to the court’s observation that the Ordinance promulgated by the State Government in favour of the Foundation cannot give the legal status to the university proposed to be established in the acquired land by the Foundation, Patnaik observed, “The reference to the Ordinance is baffling and is an error apparent on the face of record. The fact is that no Ordinance has ever been promulgated by the Government for establishing the proposed Vedanta University. Under the UGC Regulations, 2003 a university can be set up by an Act of Parliament or State Legislature by a Section 25 Company or a Trust or a Registered Society. The promoter of the proposed University, the Foundation is a “not for profit” Company registered under Section 25 of the Companies Act”.

The Chief Minister further clarified that the Assembly has already passed a Bill in July, 2009 for setting up the Vedanta University with an aim to provide education of global standards in the State. The Bill is presently awaiting the assent of the Governor.

The High Court had also observed that acquiring land in which two rivers are flowing, and requiring the company to maintain the flow of these rivers, would affect the residents of the area. The Chief Minister contended that no land comprising the rivers, channels or embankment would be transferred to the university.

“There is also no proposal to alienate the water channels in favour of the proposed university and the ownership, possession and right of use of channel will continue with Water Resources Department, and hence will serve the interest of the public at large”, he claimed.

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Update 2: Following are excerpts from an IANS report in sify.com.

‘The setting up a world class university in Orissa is most certainly in the larger public interest and his government had acted in a bonafide manner throughout the process,’ Patnaik told the assembly in response to an adjournment motion.

… Responding to the questions raised by some opposition members during the debate, Patnaik also reiterated that as per the records available with the government, the foundation had satisfied all the norms for converting itself from a private to public company.

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 Update 1: Following are excerpts from a report in Business Standard.

 

Chief Minister Naveen Patnaik has shot back at the Opposition, refuting all allegations regarding land acquisition for the proposed Vedanta University Project.

Responding to the adjournment motion on the issue moved by the Congress MLA Prasad Harichandan, Patnaik clarified that land acquisition for the project was not illegal.

… Giving his initial response to the motion, the chief minister said,"After receipt of intimation of the Anil Agarwal Foundation about the change of its status from a private to a public limited company, notification was issued under Sub-Section 1 of Section 4 of the Land Acquisition Act in respect of 7184.37 acres of land which was subsequently reduced to 6137.90 acres. Acquisition has since been made in respect of 3495.21 acres of private land while government land to the extent of 509.27 acres has also been leased out to the Foundation”.

Referring to the High Court verdict on the issue, he said, “The High Court has held that the Anil Agarwal Foundation is a private company and not a public company in terms of provisions of the Companies Act, 1956. Therefore, it has held that the acquisition of land in favour of the Foundation is not permissible except for some limited purposes enumerated under Section 40 (1) (a) of the Land Acquisition Act. In this connection, I may point out that acquisition was never made under this aforesaid provision but under Section 40 (1) (a) (a) or 40 (1(b) for a public purpose, the acquisition being for the purpose of setting up a university.”

He further clarified that the Anil Agarwal Foundation had confirmed to the state government regarding the change of its status from a private to a public company with effect from November 23, 2006 by a resolution of the Extraordinary General Meeting pursuant to the approval of the regional director, Department of Company Affairs.

"The company subsequently produced a letter dated February 21, 2007 from D K Gupta, Registrar of Companies to its address stating that the company has complied with the provisions of requirements of Section 25 of the Companies’ Act and accordingly, the status of the company has been changed from a private company to a public limited company. A copy of this letter has also been filed before the High Court by the Foundation on June 20, 2008”, he added.

Patnaik also clarified that there has been no violation of Section 16 (2) of the Shri Jagannath Temple Act.

"So far as the acquisition of land from the Lord Jagannath Temple is concerned, about 606 acres spread over nine villages has been acquired under the Land Acquisition Act. There is no violation of Section 16 (2) of the Shri Jagannath Temple Act by such acquisition as the above section mentions about previous sanction of the state government for lease, mortgage, sale and alienation of land belonging to Lord Jagannath and would not, therefore, apply to the acquisition of land under the provisions of the Land Acquisition Act”, he added. …

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Following is an excerpt from a report in DNA.

Indicating that the Orissa government might challenge the high court judgement on Vedanta University in the Supreme Court, chief minister Naveen Patnaik today claimed that there was no violation of law during land acquisition for the proposed project in Puri district.

"The period of challenging the order of the high court has not yet expired. The advocate general has been requested to advise the government on the subject, after which appropriate steps will be taken in accordance with the law," he said in a statement on an adjournment motion moved by Congress chief whip Prasad Harichandan on the issue.

… The court, in its November 16 judgement, stated that the acquisition process by the state government for a private limited company was not legal.

The chief minister, however, said, "We started land acquisition process after receipt of intimation from Anil Agarwal Foundation about the change of its status from a private to a public limited company."

Claiming that the state government had not violated law of the land, Patnaik said that land was acquired for public purpose.

"I would like to point out that the Foundation had submitted a letter dated 22, November, 2006 issued by VS Rao, regional director, ministry of company affairs, Mumbai to its address, stating that their request for permission under section 25(8) of the Companies’ Act has been considered for conversion of status of the company from private company, and that the provision of section 23, 31, 189 (2) and 192 of the Companies Act are required to be compiled with," Patnaik said.

However, a representative of the Registrar of Companies, Mumbai in its affidavit before the high court on October 15, 2008 stated that though the Registrar considered the change of status from private to public limited company, it did not furnish a certified true copy of the altered memorandum and articles of association.

The company affidavit also stated that the company had less than 7 members, the minimum requirement of a public company.

"This stand is at variance from the contents of the letter dated 21-2-2007 reportedly issued by the Registrar of the company. In view of the apparent contradiction, this matter will be examined further and appropriate steps will be taken as per law," Patnaik said.

Patnaik also rejected other factors that the varsity project would affect the Konark-Balukhand Sanctuary, violation of environment act, forest act and others.

Admitting that about 600 acre of land belonging to Jagannath Temple was acquired for the purpose, the chief minister said: "The high court has not passed any order with regard to the acquisition of the Jagannath Temple land."

Patnaik also cited recommendation of a House Committee that had earlier recommended for disposal of temple land to augment the resources of the temple. "By present acquisition for the proposed university, Rs8.80 crore have been received by the temple administration," he said.

Stating that a world-class university was required for the state, Patnaik said Vedanta Group had selected Puri after looking for different places in Rajasthan, Gujarat, Andhra Pradesh and West Bengal.

It is great to read that the CM understands the importance of Vedanta University. He has taken a huge risk to his political career in supporting this. It is time we take action in support of this. Stay tuned for our action plan.

Entry Filed under: Bhubaneswar-Cuttack-Puri- Khurda area (1),Vedanta University, Puri