Decided: 07/05/1987
Bench: REDDY, O. CHINNAPPA (J) BENCH: REDDY, O. CHINNAPPA (J) KHALID, V. (J)
FACTS
The case of Utkal Contractors & Joinery Private Limited & Ors. v. State of Orissa & Ors. revolves around the applicability of the Orissa Forest Produce (Control of Trade) Act, 1981 to forest produce grown in government forests. The appellants, including Utkal Contractors & Joinery Private Limited, held licenses to collect, sell, and purchase sal seeds from government forests with an agreement to establish solvent extraction units in specified areas. The State Government issued a notification under Section 1(3) of the Act, bringing the Act into immediate force for sal seeds and subsequently refused to accept royalty from the appellant-company, asserting that the notification rescinded their contract. This led to the legal dispute.
ISSUES
Whether the Orissa Forest Produce (Control of Trade) Act, 1981 applied to forest produce grown in government forests?
Whether contracts for the purchase of specified forest produce from government forests were protected by Explanation II to Section 5(1) of the Act?
JUDGMENT
The court declared that the Orissa Forest Produce (Control of Trade) Act, 1981 did not apply to forest produce grown in government forests, and the contracts in question were not rescinded. The government's actions were deemed invalid. The court did not extend the lease for a further period but left it to the parties to work out their rights in light of the declaration. The judgment raised questions about the government's intent in issuing notifications under the Act for various forest produce.
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