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Allahabad High Court · body

1964 DIGILAW 378 (ALL)

Uttar Pradesh State Electricity Board v. Seth Ram Gopal and Partners

1964-11-04

G.C.MATHUR, JAGDISH SAHAI

body1964
JUDGMENT G.C. Mathur, J. - This is a special appeal against the judgment of a learned Single Judge of this Court allowing the writ petition filed by respondent No. 1 and quashing the two notices sent by the appellant exercising the option to purchase the undertaking of respondent No. 1 under Section 6(1) of the Indian Electricity Act, 1910 (hereinafter referred to as the Act). 2. Respondent No, 1 is a partnership firm of electricity suppliers at Etah. Under Section 3(1) of the Act the Governor of the United Provinces granted a licence dated January 5, 1939, to respondent No. 1 for distribution of electric energy in the nine towns of Etah, Soron, Marehra, Ujhani, Bilsi, Bisauli, Islamnagar, Aonla and Tundla. Clause (1) of the licence states that the licence may be cited as "the Etah, Soron, Marehra, Ujhani, Bilsi, Bisauli, Islamnagar, Aonla and Tundla Electric Licence, 1938." Sub-clause (vii) of Cl. (2) of the licence provides that the expression "commencement of this licence" shall mean the date of the notification by the Government of the United Provinces in the local official gazette by which the licence is granted. It may be mentioned that the licence was published in the U. P. Gazette of January 7, 1939. Cl. (12) of the licence provides for the purchase of the undertaking. Sub-Cl. (1) of Cl. (12) of the licence reads as follows: "12 (I)-The Government or, if authorised by the Government, any local authority of the area of supply, shall, on the expiration of the 25 years from the date of notification of this licence and on the expiration of every subsequent period of 10 years, have the option of purchasing the undertaking; and if the Government or the local authority, with the previous sanction of the Government, elects to purchase, the licensees shall sell the undertaking to the Government, or the local authority, as the case may be, on payment of the value of all lands, buildings, works, materials, generating station, sub-stations, plant and the receiving and distributing systems of the undertaking. The percentage of the value to be determined in accordance with and for the purposes of Sub-Sec. (1) of Section 7 of the Act of lands, buildings, works, materials and the plant of the licensees therein mentioned to be added under the second proviso of the sub-section to such value on account of compulsory purchase shall be ten per cent." Section 7 of the Act, as it then stood, conferred an option on the State Government and the local authority of purchasing the undertaking upon the expiration of the periods mentioned in the licence. By another notification dated June 6, 1940, the area of supply under this licence was extended to a tenth town, namely, Itmadpur, by making necessary amendments in the original licence. By this notification the name of the licence was also amended to include the tenth town and was thereafter to be "The Etah, Soron, Marehra, Ujhani, Bilsi, Bisauli, Islamnagar, Aonla, Tundla and Itmadpur Electric Licence, 1938." 3. In the year 1948 the Electricity (Supply) Act was enacted. This Act, inter alia, provided for the setting up of the State Electricity Boards. Under Section 5 of this Act the U. P. State Electricity Board (hereinafter referred to as the Board), the appellant, was set up by the State Government. In 1959 certain amendments were made in the Indian Electricity Act. Sec, 7 was repealed and was replaced by the present Section 6. The relevant portion of Section 6(l) is as follows: "6(i)-Where a licence has been granted to any person, not being a local authority, the State Electricity Board shall, in the case of a licence granted before the commencement of the Indian Electricity (Amendment) Act, 1959, on the expiration of each such peed as is specified in the licence, have the option of purchasing the undertaking and such option shall be exercised by the State Electricity Board serving upon the licensee a notice in writing of not less than one year requiring the licensee to sell the undertaking to it at the expiry of the relevant period referred to in this sub-Sec." 4. Sub-Sec. (2) gives the option to the State Government to purchase the undertaking if the Board does not elect to do so.. Sub-Sec. (3) empowers a local authority to purchase the undertaking if the Board or the State Government does not elect to do so. 5. Sub-Sec. (2) gives the option to the State Government to purchase the undertaking if the Board does not elect to do so.. Sub-Sec. (3) empowers a local authority to purchase the undertaking if the Board or the State Government does not elect to do so. 5. Exercising powers under sub-Sec. (1) of Section 6 of the Act, the Board served a notice dated August 31, 1962, upon the licensee, exercising the option to purchase the undertaking. This notice reads as follows:- "Whereas in exercise of the powers conferred by sub-Sec. (1) of Section 3 of the Indian Electricity Act, 1910 (Act IX of 1910), the Governor of Uttar Pradesh was pleased to grant. "The Etah, Soron, Marehra, Ujhani, Bilsi, Bisauli, Islamnagar, Aonla and Tundla Electric Licence, 1938" to Seth Ramgopal and Partners; and Whereas the period of twenty-five years referred to in Cl. 12(l) of the said licence shall expire on January, 4, 1964; and Whereas the Uttar Pradesh State Electricity Board have exercised the option to purchase the undertaking; Now, therefore, in pursuance of the provisions of Section 6(1) of the Indian Electricity Act, 1910, notice is hereby given to Sarvsri Seth Ramgopal and Partners, Electricity Suppliers, Etah, to sell the undertaking to the State Electricity Board with effect from January 5, 1964." 6. Subsequently, the Board served another notice dated December 29, 1962, upon the licensee, purporting to amend the first notice. This notice read as follows:- "In partial modification of the Board's notice No. 6266-E/SLB-41/1962 dated August 31, 1962, given under sub-Sec. (1) of Section 6 of the Indian Electricity Act, 1910 (IX of 1910), and in accordance with the terms of the Etah, Soron, Marehra, Ujhani, Bilsi, Bisauli, Islamnagar, Aonla and Tundla Electric Licence, 1938, which was published in the U. P. Government Gazette dated January 7, 1939, a notice is hereby given to Sarvsri Seth Ramgopal and partners, Electricity Suppliers, Etah, to sell the undertaking to the State Electricity Board with effect from January 7, 1964, and not from January 5, 1964." 7. Thereafter proceedings were started for the evaluation and assessment of the undertaking of the licensee in respect of all the ten towns. There was some correspondence between the Board and the licensee with respect to the assessments and certain disputes arose between them. Thereafter proceedings were started for the evaluation and assessment of the undertaking of the licensee in respect of all the ten towns. There was some correspondence between the Board and the licensee with respect to the assessments and certain disputes arose between them. Ultimately, on March 26, 1963, the licensee filed before this Court the writ petition out of which this appeal arises. Two reliefs were asked for in the writ petition, namely, (1) the issue of a writ of certiorari quashing the notices dated August 31, 1962 and December 29, 1962; and (2) the issue of a writ of mandamus Waits restraining the Board, the State of U. P. and the Chief Engineer of the Hyde] Department from carrying out further proceedings including the assessment proceedings in respect of the fixed assets of the licensee. Counter affidavits were filed by Shri M.Y. Qureshi, Executive Engineer, on behalf of the Board and by Shri L. C. Vaishampayan, Under Secretary to Government, on behalf of the State. Shri Brij Mohan Bhargava, who is the son of Seth Ramgopal Bhargava, respondent No. 4 in the writ petition, also filed a counter-affidavit contending that the firm (respondent No. 1) had been dissolved and that it was not entitled to file or maintain the writ petition. It may be mentioned here that this contention was rejected by the learned Single Judge and no appeal has been filed against this portion of the judgment by respondent No. 4 and we are not concerned with this matter any further. 8. Several contentions were raised before the learned Single Judge, impugning the validity of the two notices. The learned Single Judge found in favour of the licensee on two of those contentions and allowed the writ petition on the basis of his decision on those two contentions. He did not deal with the other contentions raised by the licensee. The learned Single Judge held that, by the two impugned notifications, the Board required the licensee to sell only a part of its undertaking, namely, that relating to the nine towns mentioned in the original licence and not that portion of the undertaking which related to the town of Itmadpur and that the notices, being in respect of only a part of the undertaking, were invalid. He further found that the impugned notices did not mention the correct date of expiry of 25 years of the licence and were invalid on that account. The learned Single Judge accordingly quashed these impugned notices and directed the appellant and respondents Nos. 2 and 3 not to carry out further proceedings in pursuance of the two notices including the assessment proceedings and the assessment of the fixed assets of the firm. Against the judgment of the learned Single Judge the Board has preferred this appeal. 9. We have heard the learned Advocate General on behalf of the Board and Shri Krishna Menon on behalf of the licensee on the two points decided by the learned Single Judge as well as on the other points which the licensee raised in support of the writ petition. We will first deal with the two points which found favour with the learned Single Judge. We will first consider the second of these points, namely, whether the impugned notices mentioning January 4, 1964 as the date of the expiry of the licence and January 7, 1964, as the date of delivery of possession were invalid on that account. With respect to this point the learned Single Judge has observed as follows: "The two notices, in my view, are also invalid on the ground that they do not mention the correct date of the expiry of the period of 25 years of the licence. The two notices, therefore, cannot be deemed to have been meant for the petitioner. They are ambiguous." 10. We are unable to agree with this view of the learned Single Judge. Shri Krishna Menon contended that the date of the commencement of the licence was January 5, 1939 and that the date of expiry of the period of 25 years was January 4, 1964 and that delivery of possession could only be asked for on January 5, 1964, and not on January 7, 1964, as the notices combined together asked for. It will be noticed from this that Shri Menon does not support the view of the learned Single Judge in so far as he says that the notices do not mention the correct date of the expiry of the period of 25 years of the licence. It will be noticed from this that Shri Menon does not support the view of the learned Single Judge in so far as he says that the notices do not mention the correct date of the expiry of the period of 25 years of the licence. The learned Advocate General contended that the date of commencement of the licence was January 7, 1939, and that the date of expiry of 25 years was January 6, 1964, and that delivery of possession was properly asked for on January 7, 1964. Under sub-Cl. (vii) of Cl. (2) of the licence it is provided that the expression "commencement of this licence" shall mean the date of the notification by the Government of the United Provinces in the local official gazette. Though the licence is dated January 5, 1939, it was published in the U. P. Gazette on January 7, 1939. In accordance with the provisions of sub-Cl. (vii) the date of commencement of the licence would be January, 7, 1939. Cl. 12 (1) provides that "on the expiration of 25 years from the date of notification of this licence" the State Government or the local authority shall have the option to purchase the undertaking. The date of the notification here refers to the date of the notification in the official gazette which, in the present case, is January 7, 1939. Twenty-five years from the date of the notification would expire on January 6, 1964 and the option to purchase the undertaking could be exercised from after that date. It is true that the date of expiry has been wrongly mentioned in the impugned notices as January 4, 1964, but the mere fact that the date of expiry was wrongly mentioned cannot effect the validity of the two impugned notices. These notices were not notices terminating or revoking the licence. They were merely notices informing the licensee that the option under Section 6(1) had been exercised by the Board. In such notices it was not necessary to set out the date of expiry of the licence and the mistake or inaccuracy in the licence and the mistake or inaccuracy in mentioning such date is immaterial to the validity of the notices. What is of substance is that by the second notice possession was asked for on January 7, 1964, immediately after the expiry of 25 years on January 6, 1964. What is of substance is that by the second notice possession was asked for on January 7, 1964, immediately after the expiry of 25 years on January 6, 1964. The two notices cannot be held to be invalid on the ground of mentioning a wrong date of the expiry of 25 years. In view of our finding that the period of 25 years expired on January 6, 1964, the further argument of Shri Menon that 25 years having expired on January 4, 1964, and possession not having been asked for on January 5, 1964, the further period of ten years started from January 5, 1964, and the Board could only exercise its option after the expiry of this further period of ten years does not survive. 11. The other contention, which found favour with the learned Single Judge, is that the impugned notices purport to purchase only a part of the undertaking of the licensee and that this is not permissible under the law. The learned Advocate General does not contest the proposition that there could be no purchase of a part only of the undertaking but he contends that the Board wanted to purchase the entire undertaking and the notices did not envisage anything to the contrary. In this connection, we may refer to the pleadings of the parties. The licensee did not assert as a fact in the writ petition or in the affidavit filed in support of the writ petition that the Board wanted to purchase only a part of the undertaking. The relevant paragraphs relating to this contention are paragraphs 19 and 20 of the writ petition which read as follows : "19-That the notices dated 31-8-62 and 29-12-62 do not mention the town of "Itmadpur" which was added to the original licence by Notification No. 981-EL/79-1939 dated June 6, 1940. Thus the license was granted for ten towns and not for nine towns as given in the notices dated 31-8-62 and 29-12-62 from the U. P. State Electricity Board to the petitioner. 20-That in pursuance of the notices dated 31-8-62 and 29-12-62 the U. P. State Electricity Board and its staff has started the assessment of the fixed assets of the Firm in all the ten towns." 12. 20-That in pursuance of the notices dated 31-8-62 and 29-12-62 the U. P. State Electricity Board and its staff has started the assessment of the fixed assets of the Firm in all the ten towns." 12. After the filing of the writ petition a communication was sent to the licensee, a copy of which has been filed as Annexure 'A' to the counter-affidavit of Shri M. Y. Qureshi, wherein it was made clear that the Board wanted to purchase the entire undertaking of the licensee in respect of the ten towns in which it was operating under the licence. Again, in the counter-affidavit of Shri Qureshi, it was asserted that the Board wanted to purchase the entire undertaking. We have to see whether, in spite of this state of pleadings and in spite of the fact that long before the writ petition was filed, assessment proceedings had been started in respect of the entire undertaking of the licensee relating to the ten towns, there is anything in the two notices which compels us to take the view that, on the date when these notices were given, the Board intended to purchase only a part of the undertaking. 13. Section 6 of the Act gives the Board the option of purchasing an undertaking on the expiry of the period mentioned in the licence and provides that- "....and such option shall be exercised by the State Electricity Board serving upon the licensee a notice in writing of not less than one year requiring the licensee to sell the undertaking to it at the expiry of the relevant period...." 14. Undoubtedly, the option must be exercised strictly in accordance with the procedure prescribed. The procedure requires that the option is to be exercised by serving upon the licensee the requisite notice. The notice is to be in writing and of not less than one year. This requirement has been fulfilled in the present case. Then the notice must require the licensee to sell the undertaking to the Board at the expiry of the relevant period. The notices in the present case do require the licensee "to sell the undertaking to the State Electricity Board with effect from January 7, 1964" which is immediately after the expiry of the period of 25 years on January 6, 1964. 'Thus all the requirements of a valid notice under Section 6(1) of the Act have been fulfilled. The notices in the present case do require the licensee "to sell the undertaking to the State Electricity Board with effect from January 7, 1964" which is immediately after the expiry of the period of 25 years on January 6, 1964. 'Thus all the requirements of a valid notice under Section 6(1) of the Act have been fulfilled. It is contended by the licensee that the words "the undertaking" in the 4th paragraph of the notice dated August 31, 1962, must take their colour from the first paragraph where only 9 out of the ten towns, in which the licensee was operating, were mentioned and that accordingly it must be held that "the undertaking" referred to in the notice related to those nine towns alone. Let us now examine the notice in detail and see whether this contention is justified. The first paragraph of this notice is in the azure of a preamble and recites hat the Governor of Uttar Pradesh was pleased to grant. "The Etah, Soron, Marehra, Ujhani, Bilsi, Bisauli, Islamnagar, Aonla and Tundla Electric Licence, 1938" to the licensee under Section 3(1) of the Act. It would certainly have been better if it had been mentioned at the end of this paragraph that the licence was amended in 1940 and the name of the licence was amended by the addition of "Itmadpur" therein. But this paragraph does not describe the area of supply or the extent of the undertaking under the licence. It merely refers to the factum of the grant of the original licence. The second paragraph, which sets out the date of expiry of 25 years indicates that a reference to the licence in paragraph 1 was made only for the purpose of computing the period of 25 years. The computation could well be made from the unamended licence. The third paragraph recites that the Board had exercised the option to purchase the undertaking. The fourth paragraph, which is the operative part of the notice, calls upon the licensee to sell the undertaking to the Board. We are unable to hold that this operative paragraph called upon the licensee to sell its undertaking only in respect of nine towns. This notice does not mention any town as such but only as part of the name of the licence. Some confusion has arisen because of the unnecessary amendment in the name of the licence itself. We are unable to hold that this operative paragraph called upon the licensee to sell its undertaking only in respect of nine towns. This notice does not mention any town as such but only as part of the name of the licence. Some confusion has arisen because of the unnecessary amendment in the name of the licence itself. If, in 1940, Itmadpur had been added to the area of supply of the licence and the name of the licence had remained the same, there would have been no scope for the present argument. But, in our opinion, this change in the name of the licence does not really affect the position. The failure to mention the amend-merit in the notice cannot be taken to mean that the undertaking only in respect of nine towns was sought to be purchased. In this connection, we may take notice of another argument of Shri Menon that the undertaking sought to be purchased was not specified in the notice. This contention was raised neither in the writ petition nor at the hearing before the learned Single Judge. Though the word "undertaking" has not been defined, it means the business of the licensee under the licence. In the present case, it has not been suggested that the respondent no.1 had any other licence besides the one granted in 1939. In view of clause (12) of the licence and Section 6 of the Act, the licensee knew full well that its undertaking under the licence was liable to be purchased and, when it received the notice under Section 6 (1), it was in no doubt that it was this undertaking that it was required to sell to the Board. The correspondence between the parties shows that evaluation and assessment proceedings were started in respect of the licensee's 'business in all the ten towns. That is why no complaint appears to have been made in the writ petition about the non-specification of the undertaking. We are of the view that neither on the facts nor upon a construction of the impugned notices is the conclusion justified that the Board wanted to purchase only a part of the undertaking. The notices, therefore, cannot be held to be invalid as requiring the licensee to sell only a part of the undertaking. 15. We are of the view that neither on the facts nor upon a construction of the impugned notices is the conclusion justified that the Board wanted to purchase only a part of the undertaking. The notices, therefore, cannot be held to be invalid as requiring the licensee to sell only a part of the undertaking. 15. This disposes of the two questions which had been considered by the learned Single Judge and decided in favour of the licensee. Shri Meson raised the following four further questions in support of the writ petition : 1. That there has been non-compliance with the provisions of Section 6(4) of the Act and accordingly the Board has lost its right to exercise the option to purchase the undertaking; 2. that clause (12) of the licence does not authorise the Board to purchase the undertaking and, though the State Government had the power to amend the licence by including the name of the Board as one of the authorities entitled to exercise the option, it has not chosen to do so; 3. that the Board was not properly constituted and as such could not legally exercise the option; and 4. that Section 6 of the Indian Electricity Act violates the provisions of Articles 14, 19(1) (f) and 31 of the Constitution. We will deal with these questions in that order. Sub-Sec. (4) of Section 6 of the Act is as follows:- "6(4)-If the State Electricity Board intends to exercise the option of purchasing the undertaking under this section, it shall send an intimation in writing of such intention to the State Government at least eighteen months before the expiry of the relevant period referred to in sub-Sec. (1) and if no such intimation as aforesaid is received by the State Government, the State Electricity Board shall be deemed to have elected not to purchase the undertaking." 16. The complaint of the licensee in respect of non-compliance with the provisions of this sub-section is contained in paragraph 21 of the writ petition which reads as follows : "21.-That the U. P. Electricity Board has failed to give a notice under Section 6(4) of the Indian Electricity Act of 1910 to the State Government with simultaneous intimation to the petitioner. This is necessary as this action on the part of the Board changes the original contract of the petitioner with State Government under which this option of repurchase is available to State Government only." 17. In reply to this, it was stated in paragraph 10 of the counter-affidavit of Shri Qureshi on behalf of the Board that an intimation, as required by Section 6(4), was given in writing to the State Government. It was further asserted in this paragraph that the law did not require the simultaneous intimation to the licensee. Again, in the counter-affidavit of Shri L. C. Vaishampayan filed on behalf of the State Government, it is stated that an intimation in writing under. Section 6(4) of the Act was given by the Board to the State Government. In these circumstances, it is difficult to hold that no compliance was made with the provisions of Section 6(4) of the Act. It was complained on behalf of the licensee that the intimation under Section 6(4) should have been produced before this Court. Since the main complaint of the licensee appeared to be that no simultaneous intimation of the notice under Section 6 (4) was given to it, the authorities probably did not consider it necessary to produce a copy of the intimation. Even if no intimation had been given as required by Section 6(4) of the Act, the licensee could not take any advantage of it. Section 6 (4) is not for the benefit of the licensee. Sub-Sec. (4) of Section 6 and sub-Sec. (5), which provide for the exercise of option the local authority if the State Government does not exercise the option, are meant to regulate the relations between the Board, the to Government and the local authority inter se and do not affect the fights of the licensee. If no intimation under sub-Sec. (4) of Section 6 was given, it would only preclude the Board from asserting its right o purchase the undertaking as against the Government if the Govern went decided to purchase it, but, if the Government did not decide to do so, it would not affect the right the Board to purchase it as against licensee. Sub-Sections (4) and (5) Section 6 are not meant for the benefit of the licensee at all. Sub-Sections (4) and (5) Section 6 are not meant for the benefit of the licensee at all. We accordingly reject the contention that the notices are invalid on account of the violation of the provisions of Section of the Act. 18. Under clause (12) of the licence option is given to the State Government and the local authority authorised by the Government to purchase the undertaking on the expiry of the periods stated in the licence. State Electricity Boards did not exist t the time when the licence was granted to the licensee and the bard is not mentioned in the licence as one of the authorities which could exercise the option. Section 4-A the Act empowers the State Government to make alterations and amendments in the terms and conditions of the licence with the consent the licensee. Section 10 empowers State Government to vary the terms and conditions upon which, and the periods on the expiration of which, the licensee is bound to sell its undertaking. No amendments have been made in the licence y the State Government. Shrienon contended that, since the State Government did not exercise its powers to amend the licence by introducing the name of the Board as one of the authorities entitled to purchase the undertaking, the Board had no right to serve the impugned notices on the licensee requiring it to sell the undertaking to it. The short answer to this contention is that the statute has empowered the Board to exercise the option to purchase. Section 6 confers power on the Board also to exercise the option to purchase given by the licence. In effect, Section 6 statutorily amends clause (12) of the licence by making the option exercisable by the Board in addition to the State Government and the local authority, by providing the manner in which the option is to be exercised and by prescribing the order, in which the option is to be exercised by these three authorities. Under the provisions of Section 6 (1) of the Act the Board has full power to exercise the option and to require the licensee to sell the undertaking to it. There is thus no force in the contention that the Board has no power to exercise the option to purchase as the licence has not been amended by the State Government. 19. There is thus no force in the contention that the Board has no power to exercise the option to purchase as the licence has not been amended by the State Government. 19. We now come to the question whether the Board was properly constituted or not. Section 5 of the Electricity (Supply) Act, 1948 (hereinafter referred to as the Supply Act) provides for the constitution of State Electricity Board. Sub-Sec. (2) of this section provides that the Board shall consist of not less than 3 and not more than 7 members appointed by the State Government. Sub-Sec. (4) lays down the qualifications of members and sub-Sec. (6) the disqualifications. Sub-Sec. (5) of Section 5 of the Supply Act provides that "one of the members possessing any of the qualifications specified in sub-Sec. (4) shall be appointed by the State Government to be the Chairman of the Board. The objection of the licensee is not to the appointment of any member but to the appointment of the Chairman. Shri B.B. Lal, I. C. S., Secretary, Irrigation and Power Department of the U. P. Government, was appointed Chairman of the Board. It is not contended that he did not possess one of the qualifications set out in sub-Sec. (4) of Section 5 of the Supply Act or that he was subject to any of the disqualifications mentioned in sub-Sec. (6) of that section; nor is it contended that there is any specific prohibition in the Supply Act against the appointment of a Secretary to the Government as the Chairman of the Board. What is contended is that the Board is an authority independent of and separate from the Government, that under the provisions of Section 10, 10-A, 12, 26, 78-A and 80 of the Supply Act the Government has to exercise financial and administrative control over the Board and that, if the same person is incharge of the Board and is also the departmental head of the Government, this control cannot be exercised effectively. We are not impressed with this argument. One Secretary of the Government is not the Government. We see no difficulty in the way of the Government exercising effective control over the Board merely because one of its secretaries is the Chairman of the Board. We are not impressed with this argument. One Secretary of the Government is not the Government. We see no difficulty in the way of the Government exercising effective control over the Board merely because one of its secretaries is the Chairman of the Board. In fact, this circumstance would enable the Government to exercise control over the Board more effectively than it could if some outsider were appointed as the Chair man. No implied prohibition against the appointment of a secretary to the Government as Chairman of the Board can be spelled out from the provisions of the Supply Act. We, therefore, hold that the Board was properly constituted and had authority to serve the notices on the licensee requiring it to sell the undertaking to the Board. 20. The last contention of Shri Menon is that Section 6 of the Indian Electricity Act is invalid as it violates Articles 14, 19 (1) (f) and 31 of the Constitution. tie have first to examine, the nature and extent of the right of the licensee and then to see whether the right has been adversely affected by the provisions of Section 6 of the Act. Both under Section 7 of the Act, as it stood at the time of the grant of the licence, and under, clause (12) of the licence the licensee was bound, after the expiry of 25 years, to sell the undertaking to the State Government or to a local authority if it exercised option to purchase. The right was created with a limitation. The licensee was granted the right of carrying on the business of distributing electrical energy. in the areas specified in the licence) with the limitation that, after the expiration of 25 years, the licensee could be required to sell the under. taking. Section 6 has not created the option; it has merely empowered the Board to exercise the option already existing under the licence in favour of the State Government and the Public Authority. It further regulates the procedure and the manner of the exercise of the option. But does not place any additional burden or restriction on the right of the licensee to carry on his trade or business. It further regulates the procedure and the manner of the exercise of the option. But does not place any additional burden or restriction on the right of the licensee to carry on his trade or business. True, Section 6 introduces a new purchaser, i.e., the State Electricity Board, but it can be of no consequence to the licensee, if it has to sell its undertaking, whether the purchaser is the State Government a local authority or the Board. There is thus no violation of the fundamental rights of the licensee guaranteed under Article 19(1) (f) of the Constitution. 21. There is equally no violation o Article 14. The right of the license was, from the inception, subject t the exercise of the option to purchase and it is not Section 6 which creates the option. The option is exercised by the Board also under the terms of the licence by virtue of power conferred on it in this behalf by Section 6. The exercise of the option cannot be said to be the exercise of any arbitrary or unguided power. It is merely the exercise of a right under one of the terms of the agreement. Further, the power to exercise the option is vested in the Board which is a responsible body and it cannot be assumed that it will act in an arbitrary manner. In fact, there no allegation in the writ petition that the Board has discriminated against the licensee in the present case. 22. it was not contended that there was any direct contravention of Art.,31 of the Constitution but that, there being a contravention of Articles 14 and 19(1) (f) and Section 6 being invalid on s that account, the property of the licensee was being taken without the authority of law in contravention of Article 31. We having held that Section 6 did not violate Articles 14 and 19(1) (f), it must follow that there is no violation of Article 31 either. In our opinion, Section 6 of the Act does not violate Article 14 or Article 19(1) (f) or Article 31 of the Constitution and is not in valid. 23. In the result, we allow this appeal set aside the judgment of the learned Single Judge and dismiss the writ petition filed by the licensee (respondent no. 1). In our opinion, Section 6 of the Act does not violate Article 14 or Article 19(1) (f) or Article 31 of the Constitution and is not in valid. 23. In the result, we allow this appeal set aside the judgment of the learned Single Judge and dismiss the writ petition filed by the licensee (respondent no. 1). The appellant will be entitled to its costs of this appeal as ell as of the writ petition from respondent no. 1.