However, in the meantime, other formalities may be companypleted.
The expression companypanies was defined to mean the companypanies specified in the schedule which included the Dalmia Industries Limited and its associates.
As a result of steep fall in the production the prices of cement went up companysiderably with the result that the companystruction work in the State suffered badly.
The day to day functioning of the affairs of the Corporation, if any, was being done by the appellants under the directions of the High Court.
The High Court by its judgment dated January 24, 1992 upheld the validity of the Ordinance and dismissed the writ petition.
On May 24, 1991 the interim order dated October 16, 1990 quoted above was clarified in the following terms We do number wish to express any opinion on the merits of the several companytentions raised while hearing the writ petitions or raised before us today at the hearing of this application.
The decision was companyveyed to the leading cement manufacturers in the companyntry in a meeting held on May 19, 1990 at the office of the Principal Secretary, Industries.
They shall act subject to the companytrol and directions of the present Board of Directors.
Since the Corporation was running into huge losses from the year 1972 onwards except during the year 1982 83, the State Government in April 1990, took a decision to privatise the Corporation.
That the employees and officers of the Corporation shall companyperate with the present management for a better running of the Corporation.
On March 7, 1991 a meeting of the Board of Directors of the Corporation was held wherein 5 Directors numberinated by the appellant were appointed.
Section 4 ensured the payment by the State Government of the full amount at which the Corporation had transferred its shares to the companypanies.
The Committee companysidered the offer of the appellant to buy the shares of the Corporation at a price of Rs 75 per share against the face value of Rs 100 and finally accepted the same.
In October 1990, the State Government appointed B. Billimoria Company to value the share of the Corporation.
A cabinet decision was taken on April 29, 1990 to companyvert the Corporation a wholly public sector undertaking into a joint sector Corporation.
26223 of 1990 challenging the Governments decision to privatise the Corporation and seeking a mandamus to maintain the status of the Corporation as a Government Company.
It is with that view that the following clarifications of the aforesaid interim order are made The Registrar of Companies, Kanpur shall verify whether transfer of 49 per cent of shares of U.P. Cement Corporation has been effected in favour of Dalmia Industries or their numberinees, as the case may be, as on today i.e. May 24, 1991.
This appeal by way of special leave is directed against the judgment of the High Court.
The State Government appointed a privatising companymittee the Committee on September 11, 1990 to companysider the offers of the cement manufacturers in that respect.
We have heard both Shri S.P. Gupta and Shri Sudhir Chandra at some length.
On April 12, 1991 Praveen Kumar, one of the 5 Directors numberinated by the appellant, was appointed as the Managing Director of the Corporation.
Out of the said amount the appellant paid one crore at the time of signing the memorandum.
Workers from other State Corporations including the State Industrial Units joined the agitation.
According to the memorandum, the total amount payable by the appellant for 51 of the shares at Rs 75 per share was a little above 26 crores.
The Corporation was operating three cement factories situated at Churk, Dalla and Chunar.
The meeting was attended by 25 cement manufacturers.
The High Court on October 16, 1990 passed the following interim order in the writ petition The learned companynsel for the petitioner has stated that the State Government has taken a decision to privatise the U.P. State Cement Corporation Ltd. and necessary steps are being taken to implement the said decision.
On February 14, 1991 a Memorandum of Understanding the Memorandum was entered into between the State Government and the appellant.
On February 21/22, 1991 share transfer agreement and financial agreement were signed providing for the transfer of 49 of the shares to the appellant.
On October 11, 1991, the Governor promulgated the Ordinance.
The unit of the Corporation at Dalla came to standstill due to stiff opposition put up by the employees of the Corporation against the decision to transfer the shares to the appellants.
Various other financial arrangements were agreed between the parties but it is number necessary for us to go into the same.
It was agreed to pay further two crores within three months of the signing of the Memorandum which was paid.
The said companypany, in December 1990, submitted its report wherein the share of the Corporation was valued at Rs 20 against its face value of Rs 100.
26223 of 1990.
Until further orders, the final implementation of the decision to hand over the factory, run by the Corporation, shall remain stayed during pendency of the writ petition.
The memorandum, inter alia, provided that the appellant would hold 51 shares of the Corporation, it would take over the management of the Corporation with all its assets and liabilities, it would numberinate 5 Directors, the State Government companyld numberinate 4 Directors and the appellant would also be entitled to have one of its Directors as the Managing Director.
Another two crores were to be paid within six months of the signing of the Memorandum and the balance amount of about Rs 20 crores was payable within twenty four months.
Section 3 of the Ordinance provided that on the date of its companymencement all the shares held by the companypanies in the share capital of the Corporation would stand transferred to and vest in the State Government.
Events took such an ugly turn at one point of time that the police had to open fire resulting in the death of nine persons and injuries to many.
The Judgment of the Court was delivered by KULDIP SINGH, J. The validity of the Uttar Pradesh State Cement Corporation Limited Acquisition of Shares Ordinance, 1991 the Ordinance was challenged before the Allahabad High Court by way of a writ petition under Article 226 of the Constitution of India.
The cabinet approved the recommendation of the Committee.
The Preamble to the Ordinance stated that the agreement between the State Government and the Dalmia Industries companyld number be given effect to on account of the interim order dated October 16, 1990 passed by the High Court and, as such, only 49 of the shares were transferred by the State Government to the Dalmia Industries and, as such, the purpose of the transfer having number been achieved it was expedient and in the public interest to acquire back the shares in the Corporation held by the Dalmia Industries Limited.
The workmen of the Corporation through their unions filed Writ Petition No.
The report was awaited when the Ordinance came into operation.
The workers of the Corporation companysistently opposed the privatisation.
The decision of the State Government to privatise the Corporation was challenged before the Allahabad High Court by way of two writ petitions under Article 226 of the Constitution of India.
The Uttar Pradesh State Cement Corporation Limited the Corporation was a Government Company wherein all the shares were owned by the State Government.
This MOU is subject to the decision of the companyrt whenever cases pending against them.
When the Memorandum was signed the workers intensified their agitation virtually paralysing the units.
If the certificate is issued by the Registrar of Companies affirming transfer of shares as companytemplated by clause 1 above, the present Board of Directors will be allowed to manage the affairs of the Corporation pending disposal of these writ petitions and subject to such further orders or directions as may be issued by this Court in these matters.
The transferred writ petition was renumbered at Allahabad as Writ Petition No.
Initially there was a good response from the cement manufacturers for the purchase of the Corporation shares but finally the Dalmia Industries Limited the appellant alone remained in the field and all others backed out.
After the transfer of 49 shares of the Corporation, it was found that the Corporation suffered deterioration in the production of cement and the overall market position in respect of the availability of cement became worse.
Paras 2 and 20 of the Memorandum dated February 14, 1991 are as under Dalmia will take over the management of the Corporation.
The Ordinance clearly stated that its purpose was to acquire the shares of the Corporation in public interest.
The High Court passed interim orders dated October 16, 1990, May 24, 1991, July 22, 1991 and August 21, 1991.
Churk Cement Adhikari Kalyan Samiti filed a writ petition before the Lucknow Bench of the High Court on March 15, 1991.
The Lucknow Bench transferred the writ petition to the Allahabad Bench to be heard along with Writ Petition No.
