JUDGMENT P. R. GOKULAKRISHNAN, J. ( 1 ) IN this Group of writ petitions the petitioners are industrial concerns which had taken loans from the respondent-Gujarat State Financial Corporation (hereinafter referred to as Corporation or the GSFC) and executed agreement and deeds of mortgage/pledge/hypothecation. They have made defaults in repayment of the loan and installments thereof and in meeting with their obligations to the respondent-Corporation. The respondent Corporation had therefore resorted to Sec. 29 (1) of the State Financial Corporation Act 1951 (Act No. 63 of 1951) where under the State Financial Corporation has been conferred a right to take over the management or position or both of the industrial concern as well as the right to transfer by way of lease or sale and realise the property pledged mortgaged hypothecated or assigned to the Financial Corporation. ( 2 ) THE petitioners have therefore challenged the constitutional validity of Sec. 9 (1) of the Act and in the alternative the action threatened or taken under that provision. Section 29 (1) of the Act reads as under: 291 Where any industrial concern which is under a liability to the Financial Corporation under agreement makes any default in repayment of any loan or advance or any installment there of or in meeting its obligations in relation to any guarantee given by the Corporation or otherwise fails to comply with the terms of if agreement with the Financial Corporation the Financial Corporation shall have the tight to take over the management or possession or both the industrial concern as well as the right to transfer by way of lease or sale and release the property pledged mortgaged hypothecated or assigned to the Financial Corporation. ( 3 ) THE learned Counsel appearing for the petitioners have contended that this provision is unreasonable drastic arbitrary violative of the principles of natural justice and fair play the Corporation behaves as a Judge in its own cause and executes its own decision as its unguarded sweet will there is no hearing no reasoned order no consideration for revival of viable sick unit no safeguard no corrective machinery no appeal revision or review no guideline no procedure no natural justice no fair play and this unreasonable provision enables the respondent-Corporation to take possession and transfer the industrial concern at any price without following any procedure to any person and therefore this provision is utterly arbitrary unreasonable and violative of Arts. 14 19 21 and 300a of the Constitution. ( 4 ) SECONDLY it is contended that covering the same field of default by the industrial concern another remedy is provided by Sec. 31 of the Act whereby the Corporation has been Given an expeditious judicial remedy by way of a mere application to the District Judge for an order of sale or transfer of the management of the industrial concern and also for ad interim injunction against the industrial concern. This judicial remedy directly to the District Judge is held to be in the nature of an execution application and therefore it is a summary and expeditious remedy through Court. As against that the other direct action without intervention of the Court provided by way of Sec. 29 of the Act is very drastic and the Corporation which is an authority of the State has absolute discretion to pick and choose an industrial concern against when it would proceed under Sec. 29 (1) and not proceed against other similarly situated under Sec. 29 (1) and instead proceed against them under Sec. 31 (1) of the Act by approaching the District Judge. Thus the existence of these two remedies gives arbitrary power to the Corporation and therefore Sec. 29 (1) is violative of the guarantee of equality under Act. 14 of the Constitution of india It is also submitted that the Corporation has similar remedy under the Gujarat Public Money (Recovery of Dues) Acts 1979. It is also an effective remedy for recovery of its dues. 14 of the Constitution of india It is also submitted that the Corporation has similar remedy under the Gujarat Public Money (Recovery of Dues) Acts 1979. It is also an effective remedy for recovery of its dues. In these circumstances the authority and the discretion given to the Corporation to proceed against an industrial concern under Sec. 29 of the Act is discriminatory arbitrary and violative of Art 14 of the Constitution of India ( 5 ) ON behalf of the respondent-Corporation the learned Counsel has submitted that this statutory Corporation is a public authority established for the purpose of industrial growth with no profit motive. It utilizes its funds for helping industrial concerns to come up and recycles the recoveries and funds for the same purpose and any delay or impediment in the recovery would affect the working of the Corporation in helping the new industrial Concerns to start and Grow It is with 8 view to promote quick credit for the purpose of industrial growth and for speedy recovery of the duct a special privileges have been conferred upon the Corporation It is submitted that Sec. 29 of the Act is not a remedy but merely a right and an extension of the principle of Sec. 69 of the Transfer of Property Act with a view to Help industrial growth of medium and small scale industries It is submitted that Sec. 69 of the Transfer of Property Act enables the mortgage it it is a Government or even a private mortgage In a Metropolitan City to take direct action of taking possession and effecting sale without intervention of the Court and the validity of that provision has been upheld long back by Madras High Court. It is further submitted that theism right is given to the statutory Corporation which has been specially created to advance loans to small and medium size industries and to recycle these Fasts for the said purpose It is further submitted that a notice is given before taking action under Sec. 29 of the Act and this enables the party to explain reply or comply with the demand and the principles of fair play find natural Justice are complied with If any party has a genuine and reasonable apprehension of any illegal act it can always have remedies in law by a civil suit or a writ petition in order that the acts and commissions ors both the sides can be adjudged It is therefore submitted tit the provision in a reasonable provision made in public interest and in the interest of the industrial growth There is no procedural infirmity in the privation. It is also submitted that secs. 29 and 31 are not two remedies sad Sec. 29 is a right or privilege and Sec. 31 is a remedy to be availed of wherever felt necessary In any case it is submitted that there are sufficient guidelines in Sec. 29 itself as well as in the preamble the scheme and other provision a of the Act 9 the statement and objects and reasons of the Act where speedy recovery is the guiding factor and the Corporations which is an authority of state consists of very high official always act as a reasonable art predate person. It is also submitted that the industrial concerns while taking the loan not only know but also accept the legal liability and also expressly agree in the agreement also about this kind of consequence in case of default or breach of that agreement The learned Conceal for the respondent has alto submitted that the validity of sec. 29 has already been upheld by the High Court of Andhra Pradesh and Kerala and no other Court has taken a different view. ( 6 ) WE will consider the rival submissions in the light of the arguments advanced by them and the authorities cited before us the State Financial Corporations Act 1951 was enacted to provide for the establishment of State Financial Corporations. Its share capital establishment amongst the State Government the Reserve Bank the Development Bank Scheduled Banks Insurance Company other Financial institution and other parties. Its share capital establishment amongst the State Government the Reserve Bank the Development Bank Scheduled Banks Insurance Company other Financial institution and other parties. This distribution has to be done by the State Government with the approval of the central Government under Sec. 4 of the Act and the shares are not transferable except to the State Government Reserve Bank Development Bank or other financial institution recognized in this behalf by the State Government. The general superintendence direction and Management of the affairs and business of the Financial Corporation vests in the Board of Directors (Sec. 9) consisting of four Directors nominated by the State Government. One Director nominated by the Reserve Bank two Directors nominated by the Development Bank there Directors one of whom represents Scheduled Banks another representing Co-operative Banks and the third representing the remaining financial institutions one directly elected in the prescribed Manner from amongst other parties or shareholders and the Managing Director is to. be appointed by the State Government in consultation with and after obtaining the advice of the Development Bank and except in the case of first appointment also with the Board (Sec. 10 ). The Chairman of the Board is also to be nominated by the State Government after considering the recommendations of the board (Sec. 15) The Executive Committee consists of the Managing Director grid four other Directors elected by the nominated Director (Sec. 18 ). This Executive Committee may deal with any matter within the competence of the Board subject to general and special Directions of the Board (Se. 20 ). Chapter III relates to the power and duties of the Board which includes Secs. 29 and 31 of the Act. Section 24 provides for the general duty of the Board and it reads as under : 24 The Board in discharging its functions under this Act ball act on business principal due regard being had by it to the interests of industry commerce and the general public. Section 24 to Sec. 32f of Chapter III indicts the scope in brief by their marginal notes which read as follows:section marginal note 24 general duty of the Board. 25 business which Financial Corporation may transact. 26 limit of accommodation. 27 power to impose conditions for accommodation. 28 prohibited business. 29 right of Fantail Corporation in case of defaults. 30 power to call for repayment before agreed period. 25 business which Financial Corporation may transact. 26 limit of accommodation. 27 power to impose conditions for accommodation. 28 prohibited business. 29 right of Fantail Corporation in case of defaults. 30 power to call for repayment before agreed period. 31 special provisions for enforcement claims by Financed Corporation. 32 procedure of District Judge in respect of applications under Sec. 31. 32 A power of Financial Corporation to appoint directors or administrators of an industrial concern when management is taken over. 32 B effect of notified order under Sec. 32a. 32 C powers and duties of directors and administrators. 32 D no tight to compensation for termination of contract of management agent managing director etc. 32 E application of Act 1 of 1956. 32 F restriction on filing of suits for dissolution etc. of anindustrial concern not being a c many when its management is taken over. Chapter V contains miscellaneous provisions. Section 39 provides that in the discharge of its functions the Board shall be guided by such Instructions on questions of policy as may be given to it by the State Government in consultation with and after obtaining the advice of the Development Bank and the decision of the State Government shall be final. Section 43a enables the Board to delegate to the managing director or to any other officer of the Financial Corporation subject to such conditions and limitations if any as may be specified in the order such of its powers and duties as it may deem necessary. Section 44 provides that the Financial Corporation shall be deemed to be a bank for the purposes of the Bankers Books Evidence Act 1891 Section 46b provides that the provisions of the Act and of any rules or orders made there under shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in the memorandum or articles of association of an industrial concern or in any other instrument having effect by virtue of any law other than this Act but save as aforesaid the provisions of this. Act shall be in addition to and not in direction of 4ny other law for the time being applicable to an industrial concern. Act shall be in addition to and not in direction of 4ny other law for the time being applicable to an industrial concern. ( 7 ) THE Statement of objects and reasons for enacting this law states that it was intended to provide medium and long term credit to industrial undertaking which falls outside the normal activity of the commercial bank. The State financial Corporation being controlled and guaranteed by the Government was therefore constituted as a special statutory agency to advance loans to the deserving industrial undertakings. While providing incentives to start the industrial undertaking the recoveries from the concern has to be ensured and therefore it was specifically mentioned that the Corporation as been invested with) special privileges in the matter of enforcement of its claims against its dues. ( 8 ) SECTION 29 (1) which we have quoted in the beginning is a right conferred on the State Financial Corporation when a party commits default in payment and recovery is to be effected. At that stage the Corporation takes an administrative decision as to the manner in which it would proceed to recover its dues. At that stage the principal consideration would be as to the most expedient and speedy mode of recovery. At that stage can it be said that the Corporation undertakes any adjudicatory function? ( 9 ) EVEN Sec. 31 on which strong reliance is placed by the petitioners cannot be said to be adjudicatory because it has been held to be in the nature of execution of decree at a stage posterior to the passing of the decree. ( 10 ) IN the case of The Gujarat State Financial Corporation v. M/s. Natson Manufacturing Co. Pvt. Ltd. AIR 1978 SC 1765 : ( 1978 0 GLR 1106 the Supreme Court while reversing the judgment of the Gujarat High Courts discussed the nature of proceeding under Secs. 31 and 32 of the Act. The question had while in the context of liability to pay court-fees. The High Court had held that the applicant should bear ad valorem court-fees treating it on par with a suit by a mortgagee to enforce the mortgage debt by sale of the mortgaged property. 31 and 32 of the Act. The question had while in the context of liability to pay court-fees. The High Court had held that the applicant should bear ad valorem court-fees treating it on par with a suit by a mortgagee to enforce the mortgage debt by sale of the mortgaged property. The Supreme Court reversing this finding of the Gujarat High Court held that the proceeding under Sec. 31 was not in the nature of the suit but war something akin to an application for attachment of property in execution of a decree at a state posterior of the passing of the decree Thus when Sec. 31 is held to be in the nature of execution after passing of a decree it cannot be said that Sec. 29 is for determination of any liability by way of adjudicate on by the Corporation. ( 11 ) FOLLOWING the aforesaid judgment a Division Bench of this Court in the case of Arts. Bharat Chemical Works Baroda and Ors. v. Gujarat State Financial Corporations 1982 (2) GLR 550 held as follows (at page No. 553 para 5 of GLR): since an application under Sec. 31 (1) is held to be neither a plaintiff an application in the nature of a plaint and since it has teen specifically held; (i) that such an application is not a suit by a mortgagee for the recovery of mortgage money be the sale of mortgaged proper that the investigation therein of the claims of the Corporation is not a necessary claim does not involve all the contentions that can be raise in suit and (iii) that the substantive belief in such an application is something akin to an compunction fir attachment of property in execution of a decree at a stage posterior to the passing of the decree it is too late In the day to contend that the processing commenced upon such an application is a suit for the recovery of the case of the Corporations within the meaning of sub-sec (4) of sec. 3 of the Recovery Act and that it would abate under Sec. 7 Upon the commencement of the Recovery Act. 3 of the Recovery Act and that it would abate under Sec. 7 Upon the commencement of the Recovery Act. ( 12 ) AS far as the question of dues of the Corporation is concerned the entries in the befores are evidence of the dues in view of Sec. 44 of the Act which provides that: the Financial Corporation shall be deemed to be a bank for the purposes of the bankers Books Evidence Act. Therefore the entries in the books of the Corporation are evidence of the outstanding dues and non-payments thereof by the party. Regarding the principles of natural justice or fair lay we will discussing the same at a later stage but once these dues are duly ascertained the only question is of its recovery or execution of the decree and exercising the right of a secured creditor. Under Sec. 58 of the Transfer of Property Act a mortgagee has a right to sell the mortgaged property Section 67 provides for right to foreclosure or sale of the mortgaged property Section 69 provides for power of sale by the mortgagee without the intervention of the Court and three situations are laid down 80 under: (A) where the mortgage is on English mortgage (b) whore the mortgagee is the Government; and (c) where mortgagee is in a Metropolitan cityin the last two cases the power of sale without the intervention of the Court 19 required to be expressly conferred upon the mortgagor (mortgagee) by the mortgagee (mortgagor ). Section 69 (3) provides that when a sale has been made in professed exercise of such a power the title of the purchaser shall not be impeachable on the ground that no case bad arisen to authorize the sale or that due notice was not given or that the power was otherwise improperly or irregularly exercised but any poison damnified by an unauthorized or improper or irregular exercise of the power shall have his remedy in damages against the person exercising the power. Section 69a provides for appointment of the receiver by a mortgagee having the right to exercise power of sale without intervention of the Court under Sec 69 Similarly Sec. 172 and 176 of the Indian Contract Act 1872 provide for bailments of pledgees. Section 176 gives right to sec the property pledged after giving a reasonable notice of sale This is also without intervention of the Court. Section 176 gives right to sec the property pledged after giving a reasonable notice of sale This is also without intervention of the Court. Hypothecation is a similar right attached to the immovable property. In the case of M. K. Ranganachan and Anr. v. Govt. of Madras and Ors. AIR 1955 SC (1)4 the Supreme Court considered the right of a secured creditor when the company in wound up by Court and held as under: the scared creditor is outside the winding up W he can realise security without the intervention of to Court by effecting a sale of The mortgaged premise by private treaty or by Public question. It is only when the intervention of the Court is Sought either by putting in force any attachment dystrophies or execution within the meaning of sec. 232 (1) or proceeding with or commencing guilt of other legal proceedings against the company within the mining of sec. 171 that leave of the Count is necessary and if no such leave is obtained the remedy cannot be sailed of by the secured creditor. It would thus be clear that when the Corporation decides to resort to Sec. 29 of the Act and takes any action under that section it is not catering upon any adjudicator or quasi judicial function. It is a decision by a party tn the agreement as to what kind of steps for speedy recovery should be taken and whether the assistance of the Court is necessary. Just as a mortgagee voter Sect 62 of the Transfer of Property Act can take a decision to proceed under Sec. 69 and if he finds any difficulty in proceeding without the assistance of the court it may take a decision to go to a Court of Law. But it is the decision of a party to the Agreement and at that stage no quasi judicial function is involved. Similarly when the Corporation takes its administrative decision as to the course of action to be taken and followed it is not exercising any quasi judicial function. ( 13 ) EVEN if it is not a quasi judicial function and merely an administrative function does it mean that it can proceed without giving any opportunity of bearing and observing minimum principles of natural justice of fair play In the case of A. K. Kraipak and Ors. v. Union of india and Ors. ( 13 ) EVEN if it is not a quasi judicial function and merely an administrative function does it mean that it can proceed without giving any opportunity of bearing and observing minimum principles of natural justice of fair play In the case of A. K. Kraipak and Ors. v. Union of india and Ors. AIR 1970 SC 150 the Supreme Court observed as under: with the increase of the power of the administrative bodies it has become abuse of that power and to see that it does not become a new despotism Courts are matters like these public good is not advanced by a rigid adherence to precedents. New Problems call for new solutions. (Para 14 ). The aim of the rules of natural justice is to secure justice or to put it negatively to prevent miscarriage of juice. Them rules can operate only in areas not covered by any law validly made In other words they do net supplant the law of the lends but supplement it. The concept of natural justice has undergone a greet legal of change in recent years in the pact it was thought that it included just two rubs namely (1) no one shall be a judge is his area cause (nemo debut ease judex proper cause) and (7) no decision shall be given against a party without affording him a reasonable tearing toady alteram partem ). Very soon therefor a third rule was envisage and that is that quasi-judicial inquires must be held in goad faith without bits and not arbitrarily or unreasonably. But in the course of years many more subsidiary roles came to be Added to the rules of natural justice. Till very recently it was the opinion of the Courts that unless the authority concerned was required by the law under which It functioned to act judicial there was no room for the application of the rules of natural justice. The validity of that limitation is not questioned. If the purpose of the rules of natural justice is to prevent miscarriage of justice one fails to see why those rules should be made applicable to administrative inquires. often times it is not easy to draw the line that demarcates administrative inquires flume quasi-judicial inquires. Inquires which were considered administrative at one time ate not being considered as quasi-judicial in character. often times it is not easy to draw the line that demarcates administrative inquires flume quasi-judicial inquires. Inquires which were considered administrative at one time ate not being considered as quasi-judicial in character. Arriving at a just decision is the aim of both quasi-judicial inquires as well as administrative inquirers An Adjust decision in an administrative enquiry may have more far reaching effect then a decision In a quasi judicial enquiry. As observed by this Court in Suresh Koshy Garage v. University of kerala. Civil Appeal No. 990 of 1968 D/-15-7-68- ( AIR 1969 Sc 198 ) the rules of natural justice are not embodied rules. What particular rule of natural justice should apply to a given case must depend to a great extent on the facts and circumstances of that case the frame work of the law under Which the enquiry is held and the constitution of the Tribunal or body of persons appointed fog that purpose. Whenever a complaint is made before a Court that some principle of natural justice had been contravened the Court has to decide whether the observance of that rule was necessary for a just decision on the facts of that case. In the case of Chairman Board of Mining Examination and Chie. Inspector of Mines and Anr. v. Ramjee AIR 1977 SC 965 the Supreme Court had occasion to consider the nature and scope of the principles of natural justice. It observed as under: natural Justice is no horse no lurking land mine nor a judicial cureall. If fairness is shown by the decision maker to the man proceeded against the forum features and the fundamentals of Such essential processual propriety being conditioned by the facts and circumstances of such situations no breach of natural justice can be complained of. Unnatural expansion of natural Jesuit without reference to the administrative ratites and other factors of a given case can be exasperation. We can neither be finical nor fanatical but should be flexible yet firm in this jurisdiction. No man shall be hit belows the belt-that is the cognizance of the matter. ( 14 ) IN the case of The Keshav Mills Co. Ltd. v. Union of india and. Or. We can neither be finical nor fanatical but should be flexible yet firm in this jurisdiction. No man shall be hit belows the belt-that is the cognizance of the matter. ( 14 ) IN the case of The Keshav Mills Co. Ltd. v. Union of india and. Or. 1973 (1) SCC: 380 the Supreme Court considered what are the rules of natural justice before an administrative authority and in para 8 observed under: the second question however as to what are the principles of natural justice this should regulate an administrative act or order is a much more difficult one to answer. We do not think it either feasible or even desirable to lay down any fixed or riqorous yard-stick to this Manner. The concept of natural Justice cannot be put into a strain/jacket. It is futile therefore to look not definitions or standards of natural justice from various decisions and then try to apply them to the facts of any given case. The only essential point teat has to be kept in mindin all cases is that the person concerned should have a reasonable opportunity of presenting his case and that the a administrative authority conceded should are fairly impartial and reasonably. Where administrative officers are concerned the ditty is not so much to act judicial as to art fairly. See for instance the the observation of Lord Parker in In re H. M. fan Infant. It only mess that such measure of natural justly e should be applied as ass described by Lows Rein in Ridge v. Baldwin case (supra) as `insusceptible of exact definition but what a reasonably man would regard as a fair procedure in particular circumstances. However even the application of the concept of fair-play requires deal Flexibly Everything. will depend on the actual faces and circumstances of case ( 15 ) IN the case of Shahoodul Haque v. The registrar Co-operative Societies Bihar and Anr. AIR 1974 SC 1896 it was a case under Art. 311 of the Constitution and the Supreme Court observed as under: in any case on the facts before us we think that It will be useless to afford any further opportunity to the appellant to show cause why he should not be removed from service. AIR 1974 SC 1896 it was a case under Art. 311 of the Constitution and the Supreme Court observed as under: in any case on the facts before us we think that It will be useless to afford any further opportunity to the appellant to show cause why he should not be removed from service. The undenied and undeniable Sack that the appellant bad actually Abandoned his post of duty for an exceedingly lord period without sufficient grounds for his absence is so glaring that giving him lather opportunity to disprove that he practically admits could serve no useful purpose. ( 16 ) IN the case of M/s. Sukhwinder Pal Bipan Kumar and Ors. v. State of Punjab and Ors. AIR 1982 SC 65 the provision of Punjab Foodgrains Dealers Licensing and Price Control Order 1978 giving power to suspend licence for a periods of 90 days without giving any opportunity was upheld as a measure of social control and public interest. ( 17 ) THE case of M/s. Kharavel Industries Pvt. Ltd. v. Orissa state Financial Corporation and Ors. AIR 1985 Ori 153 is a direct case under Sec. 29 of the State Financial Corporation Act. In para 6 it was held that the Corporation cannot be forced to take recourse to Sec. 31 and it is open to Corporation to take recourse to Sec. 29 of the Act and Sec. 31 is expressly without prejudice to the provision. of Sec. 29 The Division Bench of the Orissa High Court further came to the conclusion that Reading of sec. 29 of the Act does not exclude application of the principal of Natural justice. But whether In a given cost the said rules have been complied with or not depends upon the acts and circumstances of the case. In that case Orissa State Financial Corporation afforded sufficient opportunity to the industry in as much as the Corporation gave due notice to the industries as to the default position and further its decision to take over possession on failure etc. In that case Orissa State Financial Corporation afforded sufficient opportunity to the industry in as much as the Corporation gave due notice to the industries as to the default position and further its decision to take over possession on failure etc. industry to pay the installments This was held to be due complain with the principles of natural justice However subsequently the industry made some payments and the earlier order to take over possession was not given effect to and subsequently other order for talking possession of the industry without giving by notice was passed though in the meantime there bad been tome substantial payment by the industry and Orissa High Court held that the Corporation be failed in its duty to give reasonable notice to the industries that the Corporation was going to take over the industrial concern and minimum opportunity to the industrial concern to put forth it ago before the Corporation ought to have been given The earlier order did comply with the requirement of the principles of natural justicebut the subsequent order failed to give any opportunity what saucer However we wish to male it clear that merely because there is some subsequent payment it would not nullify the earlier notice and action under Sec. 29 unless the payment is substantial say about one third of the outstanding and there is a concerto and reasonable propel and promise to pay the balance within a reasonable period If such substantial payment and proposal are made the Corporation has to consider afresh whether to proceed under Sec. 29 after talking into account the reasonable and reliability of the offer ( 18 ) IT is thus clear that even though the decision of the Corporation under Sec. 29 is not a quasi judicial decision but is an administrative section nonetheless a reasonable reading of sec 29 does not exclude the principle of fair play and tome element of natural justice It need not be an elaborate procedure of personal hearing exchange of plattings leading of evidence cross examination of witnesses It owed not even be a regular show cause notice but a notice to the party bringing to its notice the default position and the concequinces following there from of inviting action under Sec. 29 of the Act has to be given so that the party has reasonable time and opportunity to explain reply or comply with the same After considering the response if any from the party it is open to the Corporation to arrive at its own decision The party may point out in reply about the default position and/or may offer substantial part payment and offer reschedulement of repayment supported by its financial working and cash flow for the past period as well as as projected in future If the Corporation is satisfied that the debtor has been bona fide trust to and ereditworthy and because of genuine difficulties it wants reasonable reschedulement after substantial part payment the Corporation will consider theism in accordance with its policy of encouraging and assisting the industrial growth of viable industrial units and if the Corporation is of the opinion that the industrial unit does not fulfill its policy requirement the Corporation may proceed further under Sec. 29 in accordance with law but in that case it would be acting fairly reasonably and in accordance with the principles of natural justice and not arbitrarily As stated earlier in the Supreme Court judgments the Principles of natural justice in administrative decision are the principles to act fairly If that in done the Corporation can proceed further in accordance with the provisions of Sec. 29 of the Act If such action is in breach of the principles of natural justice i. e. to say the Corporation did not act fairly then that action could be challenged but that would not vitiate the legal provision contained in Sec. 29 of the Act ( 19 ) THE second aspect of unreasonableness of the provisions is alleged on the ground that there is no appeal against such decision and that the Corporation is acting as a Judge in its own cause and therefor it would be a biased decision and against the principals of natural justice and it is not subject to any further appeal or revision or review ( 20 ) IN the case of Ahmedabad Municipal Corporation v. Ramanlal Govindram etc. AIR 1975 SC 1187 (1975 GLR693) the Supreme Court reversed the judgment of the Gujarat High Court observing as follows the conclusion of the High Court that the provision irs Sec. 437a (1) unressonable because the Municipal Commissioner is in substance a party to the dispute is unacceptable The conferment of power on the municipal commissioner as an administrative officer to take proceedings for eviction cannot be struck down as unreasonable on the ground that he is judge in his own case. He is the highest officer of the Corporation The Corporation acts though these officer there is no personal interest in the Municipal Commissioner in evicting these persons. The Cooperation represents public interest. The Municipal commissioner acts in public duty in aid of public interest. The Municipal commissioner will apply his mind to the facts end circumstances of a given case as to to whether there should be an order for eviction. If the Municipal Commissioner will wrongly exercise his power the action will be corrected in appeal in the present case the Board and its officers are high ranking officials and authority and they have no personal interest against any debtor or deflator They are interested in furthering industrial policy of the State and assisting in Industrial growth and promoting credit and recycling of funds for further promoting credit to other needy industrial concerns Just as they discharge their public duties while advancing loans they are discharging public duties for effective recovery of the present It is not possible to attribute any personal bias to them so that the provision of sec 29 is unreasonable on that count. Really speaking they are not even judging their own cause They are taking an administrative decision as to what course of action should be taken in case of default. It is their duty and Sec. 29 enable them to make affective recovery by providing speedy procedure. This procedure in analogous to Sec. 69 of the Transfer of Property Act. ( 21 ) IN the case of Organs chemical Industries and Anr. v. union of India and Ors. AIR 1979 SC 1803 the Supreme Court considered the validity of Sec. 14b of the Employees Provident Funds and Miscellaneous Provisions Act 1952 There the order of the Provident Bunk Commissioner imposing damage was not subjected to appeal. ( 21 ) IN the case of Organs chemical Industries and Anr. v. union of India and Ors. AIR 1979 SC 1803 the Supreme Court considered the validity of Sec. 14b of the Employees Provident Funds and Miscellaneous Provisions Act 1952 There the order of the Provident Bunk Commissioner imposing damage was not subjected to appeal. In that case the Supreme Court observed that plea of absence of guidelines or appellate review does not affect the validity of Sec. 14-b. It observed that the appeals a desirable corrective but not an indispensable imperative ant therefore the section war not held to be bad and it was observed that if the order passed by the officer is bad it can be challenged under the writ jurisdiction. ( 22 ) IN the case of V. Narasimhachariar v. Egmore benefit society 3 Branch Ltd. AIR 1955 Mad 135 similar provision i. e. Sec. 69 of the Transfer of Property Act was challenged as violative of Art. 14 of the Constitution. Upholding the validity of that provision Madras High Court held as follows in paras 24 and 25. Thus it will be seen that the power of the mortgagee to sell under Sec. 69 coming from England got extended to this country because it is absolutely necessary for promoting quick credit. It is unnecessary to point out that though quick credit is decried in extreme left king political circles it is undoubtedly the key-stone of modern industry and commerce. In fact it is on account of these provisions the mortgages became trusted securities and intuitions and banks taking deposit have been freely investing in first mortgages. on the other hand but for such a security if funds are or be kept locked up and have to await the costly and cumbrous procedure of sale through Court. the facilities for borrowing and expanding industries and commerce would not be available in the Presidency Towns In restricting this tight only to Presidency towns the legislature based this upon a reasonable classification. I have already pointed out the extracts from various authoritative sources showing that this was not deliberately extended to the mofussil where the procedure might land itself to abuse The passage of time has not diminished but increased the usefulness of this provision and it has not rendered this classification otiose. I have already pointed out the extracts from various authoritative sources showing that this was not deliberately extended to the mofussil where the procedure might land itself to abuse The passage of time has not diminished but increased the usefulness of this provision and it has not rendered this classification otiose. There has been no time at the present when facilities for credit have got to be retained unimpaired if we are to progress From the rural economy fate a highly industrial economy. This power conferred on the mortgagees stands hedged with votes restrictions to prevent the abuse of the same The aggrieved mortgagor em have recourse to Courts both before the sale and after the sale. In certain respects his Decision is even better than that of a mortgagor in the mofussil. Over and above all as pointed out by Venkataram Ayyer J. (as he then was) In his judgment in W. P. No. 308 of D/-24-4-1953 (Mad) (251) the power of able is the subject matter of a freely negotiated contract between the mortgagor and the mortgagee The State only provides a particular procedure in the case of mortgagees in Presidency Towns and when the freely negotiated contract is not kept up what happens if the mortgages who are citizens of the Union of India like the mortgagors only come to enforce their rights under the contract entered into between them. Article 14 can obviously have no application. There is no discrimination looked at from any point of view between the persons similarly situated or circumstanced and there is no denial of equal protection There on the point taken under Art. 4 of the Constitution fails. Point (b) viz. that the power of the mortgagee to sell offends Art. 19 (1) (f) of the Constitution has no substance The Ideology behind this right is that of individualism and private property It means that a man is free to acquire any property including means of production either by inheritance personal earnings or by other lawful means to hold it as his own and dispose of it limited only by the exigencies of public welfare. Dispose of means (8) to determine the fate of to exercise power of control ever to fix the condition employment etc. Dispose of means (8) to determine the fate of to exercise power of control ever to fix the condition employment etc. to direct or assign for a use (b) to exercise finally ones power of control over to pass over into the control of someone else by selling to get aid of. Hold means to possess the property to enjoy the benefits which are accordingly attached to its ownership. In this case this power of the mortgagee to sell does not in any way interfere with the freedom of the mortgagor to acquire property or dispose of property or hold property. on the other hand this is a case of the mortgagor under the freedom guaranteed under Art 14 holding property and subject to a freely negotiates contract by him acquiring funds thereon providing for the disposal of the property in the event of his not being able to discharge the mortgage in the manner agreed to by him therefore sec 69 Transfer of Property Act does not offend Art 19 (1) (f) of the Constitution ( 23 ) THE learned Counsel for the petitioners tried to distinguish by submitting that Sec. 69 requires express consent of the mortgagor giving mortgagee the right to sell the property without intervention of the Court In the present case it is no doubt true that there is no such consent Nonetheless at the time when the industrial concern enters into the agreement it it fully aware of this legal provision and expressly agrees to the same. It is open to him not to avail of the loan facilities from this Corporation. If he does not agree to these terms the Corporation may not advance the loan After having obtained the loan he cannot say that he has not consented to the same In any case having regard to the nature of the public Corporation the public duty public purpose and the guidelines as found in the Act itself it cannot be said that the conferment of this power on the Corporation is but this act has been enacted to promote industrial growth for small and medium industries and to assist them in their growth. But that does not mean that the Corporation has to make a waste of public money for the defaulters. But that does not mean that the Corporation has to make a waste of public money for the defaulters. Every such debtor has to pay back the loan as per the agreed schedule of repayment and in case of default face the consequences As laid down by Madras High Court the object of such provision is to promote quick credit and to see that such power given to the mortgagor does not land itself to abuse and if any defaulter or mortgagor has any grievance about the action he can have recourse to Court both before and after thistle as observed by Madras High Court ( 24 ) AS a result of the aforesaid discussion it is clear that the provision does not become bad merely because it does not provide for ally appeal or corrective machinery If action of the authority acting under such section is bad it can always be challenged in writ jurisdiction and the other party is not without any remedy The Board consisting of high of lisles takes a decision under Sec. 29 of the Act That decision is required to be taken fairly and after giving a notice of reasonable time and opportunity to explain and reply the same: thereafter acting fairly if the authority takes any action the section does not become bad on any of the counts suggested in this petition that there is no appeal provided or that the Corporation is a Judge in its own cause. Once the principles of fair play are read into the provisions there is no unreasonableness arbitrariness or other infirmity in Sec. 29 and therefor Sec. 29 cannot be said to be violative of Arts 14 21 and 300a of the Constitution of India on the ground of unreasonableness and arbitrariness. ( 25 ) THE argument of unreasonableness is based more on apprehension than on reality and is merely in the abstract. Section 29 has to be read in a reasonable manner and in a proper perspective. Every legislation has a perspective which has to be read into every provision of the Act. Every provision is intended to further the perspective of the legislation. Section 29 can be resorted to only when the condition precedent of default in payment or breach of condition of the agreement is there. Therefore it is not that at any time without fulfilling the condition action is to be taken. Every provision is intended to further the perspective of the legislation. Section 29 can be resorted to only when the condition precedent of default in payment or breach of condition of the agreement is there. Therefore it is not that at any time without fulfilling the condition action is to be taken. Even such an action has to be taken fairly i. e. after giving reasonable notice time and opportunity to the deflator to explain and/or reply and/or to comply. Even thereafter the public corporation has to act fairly as a reasonable and prudent person and as a trustee after taking over possession and while effecting sale. It cannot be said that the Corporation is authorised by Sec. 29 to sell the property for whatever price and by whatever method. While the Corporation is taking over possession or management and effecting sale whether by private negotiations or auction in acting as a trustee and would act as a reasonable and prudent person as if the properties word its own and try to fetch the maximum price. If in any of those acts the authority of the Corporation goes wrong or acts illegally that action may be open to challenge before and after such action in a Court of law and the aggrieved person is not without any remedy. We are therefore of the opinion that Sec. 29 is not arbitrary irrational or unreasonable and in not violative of Arts. 14 19 21 and 300a of the Constitution. ( 26 ) THE second contention is regarding two remedies under Sec. 29 and 31 and the absolute discretion given to the Corporation to choose either of the remedies against some of the defaulters and resort to the other remedy in raspiest of other similarly situated defoliators giving arbitrary naked and unguarded discretion and enabling the authority to pick and choose and giving hostile and discriminatory treatment and between two provisions one which is more drastic should be struck down and the authority should be left with no discretion and should be directed to take action against the person under Sec. 31 by striking down Sec. 29. The learned Counsel on both the sides have cited several decisions on the question. ( 27 ) IN The case of Jyoti Parshad and Ors. v. Administrator for the Union Territory of Delhi and Ors. The learned Counsel on both the sides have cited several decisions on the question. ( 27 ) IN The case of Jyoti Parshad and Ors. v. Administrator for the Union Territory of Delhi and Ors. AIR 1961 SC 1602 the Supreme Court formulated some rules for applying equality clause of Art. 14 of tie Constitution. The Supreme Court observed that the Import content and scope of Art. 14 of the Constitution has been elaborately considered and explained In numerous decisions of the Supreme Court and to summarise the principles or rather rules of guidance would be sufficient. The Supreme Court also considered the application of those rules to the provisions of the impugned enactment. The following are the rules as summarised in the head-note: (1) If the statute Itself or the rule made under it applies unequally to poisons or things similarly situated it would be an instance of a direct violation of the constitutional guarantee and the provision of the statute or the rule in question would have to be struck down (2) The enactment or the rule might not in terms enact a discriminatory rule of law but might enable an unequal or discriminatory treatment to be accorded to persons or things similarly situated This would happen when the legislature vest discretion in an authority be It the Government or an administrative official acting either as an executive officer or even in a quasi-judicial capacity by a legislation which does not lay down any policy or diastoles any tangible or intelligible purpose thus clothing the authority with unguided and arbitrary powers enabling it to discriminate. In such circumstances the vary provision of the law which enables or permit. the authority to discriminate offends the guarantee of equal protection afforded by Art 14. (3) The above rule would not apply to cases where the legislature lays down the policy and indicates the rule or the line of action which should serve as a guidance to the authority. the authority to discriminate offends the guarantee of equal protection afforded by Art 14. (3) The above rule would not apply to cases where the legislature lays down the policy and indicates the rule or the line of action which should serve as a guidance to the authority. Where such guidance is expressed in the statutory provision conferring the power no question of violation of Art 14 could arise unless it be that the roles themselves or the policy indicated lay down different Ruled to be applied to persons or things similarly situated Even where such is not the case there might be a transgression by the authority of the Limits laid down or an abuse of power but the actual order would be set aside in appropriate proceedings not so much on the ground of a violation of Art. 14 but as really being beyond it. power (4) It is not however essential for the legislation to comply with the rule as to equal protection that the rules for the guidance of the designated authority which is vested with the discretion should be laid down in express terms in the statutory provision itself. Such guidance may thus be obtained from or afforded by (a) the preamble read in the light of the surrounding circumstances which necessitated the legislation taken In conjunction with well-known facts of which the Court might take judicial notice or of which it is appraised by evidence before it in the form of affidavits. In the circumstances Indicated under the fourth head just as in the third the law enacted would be valid being neither a case of excessive delegation or abdication of legislative authority viewed from one aspect nor open to objection on the ground of violation of Art 14 as authorizing or permitting discriminatory tory treatment of persons similarly situated the particular executive or quasi-judicial act would however be Open to challenge on the ground not so much that It is in violation of the equal Protection of the Ices guaranteed by Art 14 bateau ex-concess is that was not permitted by the statute but on the ground of the same being ultra vires as not being sanctioned or authorised by the enactment itself. The situation in such cases would not be parallel to the tests to be applied for determining the validity of rules made under statutes which enable the rule making authority to enact subsidiary legislates to carry and purposes of the act The criteria to be applied to determine the validly of itch roles could be appropriately applied to determine the validity of the action under the provisions like the one dealt with under the last two heads. In view of the judgment of the Supreme Court theme rules are required to be applied to the present ease According to the petitioners the Act enables unequal and discriminatory treatment to the defoliators similarly situated because the legislature has vested discretion in the corporation without laying down any policy and disclosing any tangible or intangible purpose and therefore the authority has been clothed with arbitrary power enabling it to discriminate In such circumstances sec 29 will be bad as violative of Art 14 of the Constitutionaccording to the respondents the legislature has laid down the policy of speedy recovery and indicated the line of action which would nerve as 8 guidance to the authority and therefore there is no violation of Art 14 of the Constitution It is further submitted that as laid down by Rule 3 if in a given case the authority has sated beyond the guidelines or there is abuse of power such action can be has aged by uproot proceeding but not the section. It is further stated that the guidance in provided by the statement of objects and reasons which show the objects of the legislation and the objective sought to be achieved by the legislation the policy laid down while igniting the legislation and laying down the policy in the legislation itself ( 28 ) IN the case of State of Orissa v. Dhirendranath Das. AIR 1961 SC 1715 the Supreme Court struck down the prejudicial procedure out of the two procedures and observed as follows if against two public secants similarly circumstances inquires may be directed according to procedures substantially different et the Discretion of the executive authority exercise where is not governed by any principal having any rational relation to the purpose in be achieved by the enquiry the order selecting a preju. dicial verdure. out of the two open for selection is hit by Art. 14 of the Constitution. dicial verdure. out of the two open for selection is hit by Art. 14 of the Constitution. ( 29 ) IN the case of Ram dial and Ors. v. State of Punjab AIR 1965 SC 1518 there were two provisions in the Punjab Municipalities Act i. e. 14 (e) and 16 (11) for removal of a member in public interest Under Sec. 16 (1) hearing is provided to the member ensured but if for exactly same reason the State Government chores to take action under sec 14 (e) it does not give any opportunity of bearing This was held to be obviously discriminatory and therefore that part of Sec. 14 (e) was struck down as violative of Art Iq of the Constitution ( 30 ) IN the case of Mannawar Ahmad and Ors. v. State of Madhya pradesh and Ors. AIR 1981 MP 41 the provision was struck down as violative of Art 14 not on the ground of discrimination because of two remedies but on the ground of discrimination and arbitrariness of Two privation of aviation without hearing ( 31 ) IN the ease of S. M. Nawab Ariff v. Corporation of Calcutta and Ors. AIR 1960 Cal. 159 it was held that where out of two deferent to which theism person or same class of person is subjected one last is more burdensome than the other the law which is burdensome will be struck down as discriminatory law. in para 10 Calcutta High Court found that no principal or the policy or the guidance as laid down. 159 it was held that where out of two deferent to which theism person or same class of person is subjected one last is more burdensome than the other the law which is burdensome will be struck down as discriminatory law. in para 10 Calcutta High Court found that no principal or the policy or the guidance as laid down. ( 32 ) ON behalf of the respondents strong reliance has been kept on the judgment of the Supreme Court in case of Maganlal Chhaganlal (P.) Ltd. v. Municipal Corporation of Greater Bombay AIR 1974 SC 2009 In that case the Bench of seven Judges of the Supreme Court of Jyoti Prashad (supra) and observed as follows in para 16: the statute itself in the two classes of cases before us clearly lays down the Government should be subject to speedy prodder in the Matter of evicting unauthorised persons occupying them The is a sufficient guidance for the authorities on them the power has been inferred With such an indication clearly given In the statutes one expects the officer unearned to avail themselves of the procedures prescribed by the Jets and not resort to the Dilatory procedure of the ordinary Civil Court Even normally are cannot image an officer beverage the choice of two procedure one which enable his to get possession of the Property quickly and the other which world be prolonged one to resort to the lever administrative Allures no less than the Courts do not function In a vacuum it would be extremely aerial to bold that an Administrative Oilier tools In taking proceedings for aviation of authorized occupants of Government property or municipal property resort to the procedure prescribed by the two Acts in one case and to the ordinary Civil Court in the other The provisions of these two Acts cannot be struck down on the fanciful theory that power would exercised in such an unrealstic fashion In considering whether the off-line would be exercised between one set of persons and month one has not to take into account normal human behaviour and not behaviour which abnormal It is not every Senesced possibility of discrimination be the real risk of discrimination that we must take into account This is not one of those canes where discrimination is writ large in the face of the statute Discrimination maybe possible but is very improbable And if there is discrimination in actuate prorate this Court is not powerless furthermore the fact that the Legislature considered that the ordinary prodder is insufficient or ineffective in evicting unauthorized occupants of Government and Corporation Property and provided a special speedy procedure therefore is a clear guidance for the authorities charged with the duty of evicting unauthorized occupant We therefor for ourselves unable to agree with the majority in the Northern India Caterers ease 1967 (3) SCR 399 AIR 1967 SC 1581 . ( 33 ) IN the case of Commissioner of Sales Tax M. P. Indore and Ors. v. Radhakrishnan and Ors. 1979 (2) SCC 249 the validity of sanction given by Thistles Tax Commissioner for prosecution was challenged on the ground that the Commissioner was entitled to two different procedures for enforcing and releasing the assessment made and one was more drastic than the other and there were no guidelines as to the circumstances in which be should resort to either of the two procedures. The Supreme Court followed its earlier decision in the case of Maganlal Chhaganlal (supra ). In para 14 the Supreme Court referred to its earlier duration in the case of State of Kerala v. C. M. Francis AIR 1961 SC 617 wherein it was held that if the two Remedies are open Book can be inserted of the option of the iterates recovering the amount unless the statute is express words lays down that one remedy is to the exclusion of the other Another case of Ram Sarup v Union of India AIR 1965 SC 247 was also considered wherein the question arose as to whether the power under Sec. 125 of the Army Act which empowered the officer either to try a case by Court-martial or by an ordinary Court or by a Criminal court was loft entirely within his discretion without any guidance nod was violative of Art. 14 of the Constitution. The Supreme Court held that the choice as to which Court should try the accused is life to the responsible military officers under whom the accused is serving and these officers were to be guided by consideration of the exegesis of the Service Maintains of discipline in the army spitfire trial the nature of the offence and the person against whom the offence is committed. When power is conferred on high and responsible officers they are expected to act with caution and impartiality while discharging their duty and the circumstances under which they will choose either of the roomettes available should be left to them. When power is conferred on high and responsible officers they are expected to act with caution and impartiality while discharging their duty and the circumstances under which they will choose either of the roomettes available should be left to them. The vesting of discretionary power in the State or public authorities or an officer of high standing is Treated of a guarantee that the power will be used fairly and with a sense of responsibility it has been held by the Privy Council in Province of Bombay v Bombay municipal Corporation that every statute must be supposed to before public good at least in intention and therefore of few laws can. It be said that the law confers unfettered discretionary power since the policy of law Users guidance for the exercise of discretionary power. Applying the principles of this decision to the present case the guidance will have to be inferred from the policy of the law itself that is if on particular facts of a case the commissioner who is an edgier of high attending in exercise of his discretion corner to the conclusion thus mote drastic remedy should be taken the exercise of that option cannot be termed as unconstitutional In considering the validity of a statute the presumption is in favour of its constitutionality and the burden is upon him who attacks it to Show that there has been a clear transgression of constitutional principles. For sustaining the presumption of conclusion that the Court may take into consideration matters of common knowledge matters of common report the history of the times and may assume every state of facts which can be conceived. I must always be presumed that The legislature understands and correctly appreciates the need of Its own people and that discrimination any is based on adequate grounds It is well settled that Courts will be justified in given a liberal inter partition to the section in order to avoid constitutional invalidity. These principles have given rise to rule of reading down the sections if it become necessary to uphold the validity of the Section. In the present case it is seen under Sec. 46 before a prosecution can be launched it is necessary that the assessed should have failed to pay the tax due within the time allowed without reasonable cause. These principles have given rise to rule of reading down the sections if it become necessary to uphold the validity of the Section. In the present case it is seen under Sec. 46 before a prosecution can be launched it is necessary that the assessed should have failed to pay the tax due within the time allowed without reasonable cause. The duty of the Commissioner is therefor to be satisfied that the assays has failed without reasonable cause and without reoccurs to prosecution under Sec. 46 (1) (c) the tax cannot be allocated. The provision of Sec. 22 (4-A) can be read as being applicable to cases in which the stringent step of prosecution is considered not Necessary. The option is with the Commissioner and if he thinks levy of penalty would achieve the purpose of collection of the tax he can have recourse to the provisions of sec. 22 Before laying a penalty under Sec. 44 (4-A) the Commissioner shall not reasonable opportunity of being heard as to why the penalty should not be levied. Reading the two provisions harmoniously we are of the view that the discretion is given to the Commissioner to report to one of the two remedies as the faces of the ease may require. In graver cases he will be justified in talking the drastic remedy and resorting to prosecution in the Criminal Court if he is satisfied that such a course is necessary for the collection of the tax expeditiously. If the discretion is not properly exercised the Court may be justified in interfering in such cases but the law cannot he held to be inviolate. In the presort case ore have no doubt it is a grave case of failure to pay the tax repeated reminders went unheeded. The commissioner on the facts is fully jousted in coming to the conclusion that resort to prosecution is necessary. On a consideration of the decisions on the point we are satisfied than there is nothing illegal in conferring different proceeds on the authorities. Taking into account the scheme of the Act it can be inferred that a more drastic ranted is to be taken when such a step is found necessary on the facts of the case. On a consideration of the decisions on the point we are satisfied than there is nothing illegal in conferring different proceeds on the authorities. Taking into account the scheme of the Act it can be inferred that a more drastic ranted is to be taken when such a step is found necessary on the facts of the case. Thus construed the validity of the section cannot be questioned but if the face of the case do not warrant taking of the graver stop and no adequate reasons are found that order in such circumstances may be found to be invalid. ( 34 ) IN the case of Director of industries v. Deep Chand Agarwal AIR 1980 SC 801 the validity of Sec. 3 of the U. P. Public Moneys (Recovery of Dues) Act was challenged on the ground of Art. 14. The Supreme Court negatived the contention. Allahabad High Court has struck down that provision following the Supreme Court judgment in the case of Northern india Caterers (supra ). However that was overruled by the Supreme Court in the case of Maganlal Chhaganlal (supra ). Therefore the Supreme Court reversed the judgment of Allahabad High Court observing as follows: the Act is passed with the object of provident a Spiffier reigned to the State Government to realise the loans advanced by it or by the Uttar Pradesh Financial Corporation The State government while advancing loans does not act as an ordinary banker with a view to arguing interest. Ordinarily it advancer loans in order to assist the people financially in establishing in industry in the State or for the development of agriculture animal husbandry and for such other porpoises which would advance the economic well-being of the people Moneys advanced by the State government have got to be recovered expeditiously so that flesh advance may be made from the State Government it is with the object of avoiding the usual delay involved in the disposal of suits in Civil Court and Providing for an expedition remedy the Act has been enacted. It cannot therefore be said that there is no reasonable basis for the classification made by be statute and that classification does not have a reasonable relation to the object of the statute. It in no doubt true that there is no express provision in the Act containing guidelines. It cannot therefore be said that there is no reasonable basis for the classification made by be statute and that classification does not have a reasonable relation to the object of the statute. It in no doubt true that there is no express provision in the Act containing guidelines. That however is not sufficient to hold that Sec. 3 of the Act confer arbitrator power on the State Government and makes a hostile discrimination. An Officer authorized by the State Government to issue the certificate is expected ordinarily to avail himself of the spitfire remedy provided under the statute. The Act which of passed with the object on providing a speedier remedy of provides sufficient guidance to the Officer concerned as to when be could resort to there made provided by it. Thus the object of specked remedy and recovery is held to be a sufficient guideline especially when the power is conferred on the State agency which is not an ordinary banker and the public dues are to be recovered expeditiously on that fresh advances may be made from the same. The Supreme Court noticed that there was no express provision in the Act laying down the guideline. Yet Sec. 3 was not struck down on the ground that the object of providing speedier remedy itself provides a sufficient guideline to the officer concerned as to when he shall resort to that remedy. ( 35 ) IN the case of Chandra Bhawan Boarding and Lodging Bangalore v. State of Mysore in Anr. AIR 1970 of 2042 the challenge was on the ground that two different procedures were available to the Government for fixation of minimum wages and it was contended that it conferred unguarded and uncontrolled powers on the Government to follow either of the two procedures in the matter of fixing minimum wages. Negativing the contention the Supreme Court observed as under : it is true that this Court has namely ruled that the procedural inequality if real and substantial is also within the vice of Art. 14. But then before a power can be held to be bad the same should be an unguarded and unregulated one. But if a power is given to an authority to have record to different procedures under different circumstance that power cannot be considered as an authority power. But then before a power can be held to be bad the same should be an unguarded and unregulated one. But if a power is given to an authority to have record to different procedures under different circumstance that power cannot be considered as an authority power. It must also be remembered that power under Sec. 5 (1) is given to the State Government and not to any petty judicial. The State Government can be trusted to exercise that power to further the purposes of the Act. It is not the law that the guidance for the exorcise of a power should be an that able from one of the provisions in the Act. It can be gathered from the circumstances that led to the enactment of the law an question i. e. the mischief that was intended to be remedied the preamble to Thicket or even from the scheme of the Act. ( 36 ) IN thatches of Manohar Lal Bhogilal Shah v. the State of Maharashtra. AIR 1971 SC 1511 the question was of discretion to the customs authorities to take two different proceedings. In para in the Supreme Court observed that in all cases the customs officers have to act in a reasonable and bona fide manner and they cannot just discriminate between similar cases according to their whim and fancy. If that is done it is always open to a person against whom as complaint has been instituted to challenge their exercise of discretion in appropriate proceedings and the following observations from earlier Supreme Court judgment in the case of Matajog Dobey v. H. C. Bhari AIR 1956 SC 44 were relied. It has to be borne in mind that a discretionary power is not necessarily a discriminatory power and that abuse of power is not to be easily assumed where the 9. discretion is vested in the Government and not in a minor official. ( 37 ) IN the case of Bharat Chemical Works v. G. S. F. C. 1982 (2) GLR 550 the question was considered between two remedies of Sec. 31 under the State Financial Corporation Act and Sec. 3 (1) of the Gujarat Public Moneys Recovery of Dues Act. The Division Bench of this Court held that both the provisions were akin to execution proceedings and therefore they do not confer two competing powers one displacing the other. The Division Bench of this Court held that both the provisions were akin to execution proceedings and therefore they do not confer two competing powers one displacing the other. It was held that the Corporation has only one power namely the power to take steps akin to the execution of a decree and that power may be exercised in either or even both of the two modes in certain cases and the discretion is left with the competent authority to take resort to any one or both of the said remedies. Therefore neither of the remedies in barred or is violative of Art. 14 of the Constitution of India. Same reasoning applies to Sec. 29 also. ( 38 ) FROM the aforesaid decisions it can be easily seen that mere existence of different options to the authority is not violative of Art. 14 of the Constitution. It is to be seen whether these options are guided by any policy. The policy is obvious from the enactment and its object. A special privilege and right has been chauffeured on the Corporation to effect speedy recovery and the guiding principle is speedy recovery. When the guidance is provided for the exercise of Option it cannot be said that this discretion regarding exercise of option is unguarded and arbitrary and therefore the challenge on that count cannot succeed. ( 39 ) THE same view upholding validity of Sec. 29 has been taken in the case of M/s. Srinivasa Kandasari Sugars Narasimhunipet v. Govt. of Andhra Pradesh and Ors. AIR 1976 AP 93 . Its conclusions are recorded in head out A which reads as under: every statute providing for two different procedures covering the same field and making one of them drastic does not ipso facto become violative of Art. 14 of the Constitution of India. It is only in such cases where there are no guidelines specificalls in the statute and where the necessary guidance cannot also be gathered from in examination of the preamble surrounding circumstances and the provisions of the statute themselves explained and amplified by affidavit the power conferred on the administrative body to those one procedure or the other can be condemned as an unguarded one and the provision of Jaw providing for such on unguarded power suffers from the vice of discrimination. But a statute which satisfied these tests cannot suffer from the vice to unconstitutionality. But a statute which satisfied these tests cannot suffer from the vice to unconstitutionality. Case law reviewed. The to procedures mentioned in Secs. 29 and 31 are different and there are no provision by way of guidelines in these two sections us to whom a Particular procedure can be resorted to. The choice is left to the Corporation. From a combined reading of the Objects and Reasons and Secs. 9 10 24 25 and 27 the requisite guidance can be inferred and a very responsible authority is vested with the power of Selecting either of the procedures under Secs. 29 and 31 respectively So the statute Itself disclose difficult and objective and it confers authority on the Corporation to make selection of the procedure. Whom that is so a responsible body like the Financial Corporation with act in a realistic manner kept in view the inter of the Corporation industry commerce and the general public. There is a guiding police and principle available from the statute for the Corporation to act in this regard and accordingly Sec. 29 is not violative of Art. 14 of the Constitution. We are in complete agreement with the conclusion that there in guiding policy and principle available from the statute in this regard. Therefore Sec. 29 is not violative of Art. 14 of the Constitution. ( 40 ) SAME view has also been taken by the Division Bench of Kerala High Court in the case of K. Surendranathan v. Kerala Financial Corporation AIR 1988 Ker 330 . It is summarized in head note (A) which reads as follows: it is not the law that there can be only on remedy available for recovery of loans advances etc. from deflators namely recourse through the ordinary Courts of land. any statute may In appropriate cases Provide for more than one remedy against the same deflator for recovery of the dues or it may be that relief for recovery in provided in different enactments. Special remedies may be available in favor of or against particular classes of persons. When these two statutory remedies are available against the same deflator the power so conferred under the statute is not arbitrary where There are guidelines to control the discretion to be exercised Thus guidelines reed not necessarily be specifically enumerated In thievery section or provision conferring those powers. When these two statutory remedies are available against the same deflator the power so conferred under the statute is not arbitrary where There are guidelines to control the discretion to be exercised Thus guidelines reed not necessarily be specifically enumerated In thievery section or provision conferring those powers. the guidelines can be gathered from the other provisions of the Act itself the preamble and the surrounding circumstances etc. The State financial Corporations Act intended to create and the Government constituted Financial Corporation mainly to advance loans and to give financial assistance to contain financial undertakers. The Corporation is controlled managed and supervised by a Board of Directors chosen with special emphasis on the financial Responsibility of the to partaken. The Board has to act on basic principles duo Regard being had to the interest of the industry commerce and general public as specifically provided in SCC 24. An the information of its right and obligations the Board cannot of matter its finds by giving dubious loans and for to take proper steps for recovery on the anoints due. To be compelled to resort to a Court of law for recovery of its the is to such to the inevitable delay that it intact. The Act therefore intended that the Corporation should have special privileges for enforcement of its claims. the object was sought to be achieved by the provision contained in Sec. is and sec. 29 and by Sec. 32-B also. Section 29 is an enabling provision under which the corporation can in certain circumstances if the situation warrants take possession of the secured premises in the interests of the industry in the inter of the Corporation in case on default in the absence of Sec. 29 the Bold would have been powerless to take Possession even in those cases where there is default and no attempt is made by the defaulter to pay the does and the factory is allowed to remain idle. Delay In taking possession in such cases may be suicidal to the interests of the Corporation and the industry for the machinery etc. may rust and the undertaking with be using can it is brought to sale latter. section 29 is the not meant for arbitrary use not capable of arbitrary exclusive. Delay In taking possession in such cases may be suicidal to the interests of the Corporation and the industry for the machinery etc. may rust and the undertaking with be using can it is brought to sale latter. section 29 is the not meant for arbitrary use not capable of arbitrary exclusive. the guidelines for the on case of this power also thus found in the object and purpose of the Act and in thieveries provisions including Sec. 24 of the Act. Sec. 29 is thus not arbitrary or 1st violative of Art. 14 of the Constitution. AIR 1976 AP 93 AIR 1983 Rant 30 and AIR 1984 Ker. 194 Rel. on. ( 41 ) FURTHER there is some difference between the providence of Sec. 29 and 31. Although the condition president for initiating the action he one under both the provisions viz. default of the outstanding duos or breach of agreement under Sec. 31 the Court can give specified reliefs only namely: (A) Sale of the property; or (b) transferring the management of the industrial concern to the Financial Corporation; or (c) ad interim injunction restraining the industrial concern from transferring or removing its machinery or plant or equipment. The Court sale will be an auction sale where the terms and conditions would be of certain set pattern only. The concerns and the properties which are required to be sold are the industrial concerns of medium and small size worth lacs or rupees and capable of being run on economic and viable basis if the conditions of payments can be would in accordance with the policy of the financial corporation which cannot be done in case of a Court sale. Moreover in Court sale it is not easy to find purchasers as compared to sale and Negotiations by the Corporation. The Court will not be in a position to grant installments to the purchaser which facility would being a better price and also revival and/or continuance of the industry which is the object of the financial corporation. Under Sec. 29 the Corporation has been given power to lease the property the Court cannot do this. In a given case leasing the property might be more beneficial both to the creditor as well as debtor because the debtor without losing the property permanently might be able to discharge the debt within a reasonable time. Under Sec. 29 the Corporation has been given power to lease the property the Court cannot do this. In a given case leasing the property might be more beneficial both to the creditor as well as debtor because the debtor without losing the property permanently might be able to discharge the debt within a reasonable time. Therefore it is not possible to say that Secs. 29 and 31 cover the same field. The express language of Sec. 31 without prejudice to the provisions of Sec. 29 of this Act and of Sec. 69 of the Transfer of Property Act makes it abundantly clear that the legislature has deliberately provided a special and additional right and privilege to the financial corporation in Sec. 29 indicating the guideline that expeditious remedy of Sec. 29 is to be resorted and Sec. 31 is an additional right which is without prejudice to the provisions of Sec. 59 to approach the Court whenever the Court assistance is felt necessary by the Corporation ( 42 ) AS a result of the aforesaid discussion we hold that Sec. 29 does not prohibit application of the principles of natural justice and fair play and a notice of demand of dues and of intention to take action under Sec. 29 gives a due opportunity to the industrial concern to explain reply or comply or make suggestions and the procedure is reasonable procedure and the right given to the secured creditor take Financial Corporation is a right to proceed without intervention of the Court and in reasonable having regard to the status and nature of the Corporation which is charged with a public duty of granting loans and making recoveries with a view to industrial growth and public interest arid on business principles. The rules of natural justice or to secure justice and to prevent injustice and if fairness is shown be the decision maker on broach of natural just can be complained of ( AIR 1977 SC 965 ) and duty is not to act Judicial but to not fairly ( 1973 (1) SCC 380 ) and in each case it is to be can whether the authority has acted fairly. If the authority has acted unfairly such not of the authority can be challenged but the section cannot be said to be unreasonable and the aggrieved party can challenge the action of the authority at any appropriate stage before after the action is taken and there is no person left without remedy before judicial forum. Even though Secs. 29 and 31 cannot be said to be two remedies to the authority the discretion is properly guided desertion. Promotion of quick credit is recognised to be a necessity of commerce even before the industrial revolution had effectively spread in India hundred years ago. With the present necessity of quick industrial growth and the necessities of the modern times the necessity of promotion of quick credit has become more ant more acute so also its recovery. If quick recovery is not assured the credit would be slow In giving and would thus hinder the industrial growth. Therefore quick credit and quick recovery is the key stone of modern industrial growth and it is because of such statutory provision and assurance that it has been possible to extend credits to industrial concerns and effect recoveries. As observed by the Madras High Court the passage of time be not diminished but accursed the usefulness of such provision. It is seen from experience that neither Sec. 69 of the Transfer of Property Act nor Sec. 29 of the State Financial Corporations Act by resulted into grave injustice to any party. If there has been any occasion of injustice remedy is available to the aggrieved party. The discretion if any to choose between the remedies is guided by the considerations with which the not was enacted and this judge discretion is clearly covered by Rule 3 in Jyoti Parshads case (supra) and not by Rule 3. The guiding principle is speedy recovery and with such indication clearly indicated in the Act the officers of the Corporation are Expectted to avail themselves of the more effective procedure and not resort to the procedure which is likely to delay. Any procedure which in effective from the view point of the creditor is likely to be looked upon as drastic by the debtor and any provision looked upon by the debtor as a soft and fair procedure is likely to be seen by the creditor as dilatory and frustrating. Any procedure which in effective from the view point of the creditor is likely to be looked upon as drastic by the debtor and any provision looked upon by the debtor as a soft and fair procedure is likely to be seen by the creditor as dilatory and frustrating. It is for the Court to see whether the legislature has provided guidance for exercising the discretion. Once the legislature itself indicates that the speedier procedure is to be resorted it cannot be said that there is arbitrary discretion given to the authority. Even the Supreme Court has recognised that the officers having these discretionary powers would choose the procedure which is mere expeditious and more effective and such discretion cannot be said to be arbitrary having record to the normal behaviour and whenever there is actual discrimination in practice the Court is not powerless to strike it. Whenever a summary power or procedure is prescribed for recovery of taxes public moneys public premises and for collection of public funds the legislative intention is clear that the legislative want the authority to act quickly and effectively and this power has been given to the Board which consists of high Govt. Officers nominees and Directors and they are expected to exercise the power justly and fairly and they can be trusted with the power. ( 43 ) IN view of these conclusions we are therefore of the opinion the there is no merit in the challenge by the petitioners to the constitutional validity of Sec. 29 (1) of the State Financial Corporations Act on the ground of Arts. 14 19 21 and 300a of the Constitution. ( 44 ) AS regards individual facts of each petition it is to be noted that it in an admitted position that substantial amount is due and outstanding in each of the petition to the Corporation. Even though notices have been given in all cases substantial amount still remains outstanding. Even though these petitions are pending since long and there was sufficient time and opportunity to made the payment unfortunately the petitioners have failed to avail of the same. Even though notices have been given in all cases substantial amount still remains outstanding. Even though these petitions are pending since long and there was sufficient time and opportunity to made the payment unfortunately the petitioners have failed to avail of the same. In view of the fact that in almost all cases only advertisement for sale has been issued sat no further action has been taken or in some cases only notice under Sec. 29 has been issued there is of substantial question which requires to be considered in those matters. A we have already come to the conclusion that Sec. 29 is a valid piece of legislation and In reply to the notice under Sec. 29 it is open to the industrial concern to explain and pay. In some of the cases interim refer has been granted unconditional. In some cases it is conditionally On payment of some amount. in most of the cases interim relief is vacated refused or not granted. However no action for recovery or telling possession of effecting sale has been taken. Since a lose time has passed thereafter It would be necessary to issued fresh advertisements. In the mean while it is open to these units to make payment of the dues and avoid recovery and action under Sec. 29 of the Act. In view of the fact that large amounts have been outstanding since a very long time and the industrial concerns have not shown their bona fide intention to make payment by making even part payments irrespective of the fact whether they are protected or not by any interim order. If they are protected by interim order it was all the more necessary for them to make best use of their protection by making payments. By this time entire or substantial debt would have been wiped out. The fact that no such substantial payment has been made shows that there is no bona fide intention to make the payment or there is no ability to make the payment and the resultant action under Sec. 29 is inevitable. The industrial concern was not only to show that it has intention to pay or that its word is trustworthy or credit worthy but also that it has to make actual payment. The industrial concern was not only to show that it has intention to pay or that its word is trustworthy or credit worthy but also that it has to make actual payment. Having regard to the length of time and the amount of dues which has remained outstanding it cannot be said that the action of the Corporation to proceed under Sec. 29 is in any any unreasonable. The Corporation cannot wait indefinitely. The industrial Units had mere than sufficient time and opportunity to make the payments. In view of the fact that till today no effective step has been taken under Sec. 29 except issuing advertisement or notice under Sec. 29 nothing further is required to be considered. As and when possession is taken and/or sale is effected such sale or action of taking possession may be challenged if there is any material irregularity or illegality in the same and that would be considered at that stage in accordance with law. At present it is clear that the respondent-Corporation is entitled to proceed under Sec. 29 of the Act by tailing appropriate actions. In view of the fact that the advertisements were issued long back it would be in the Stress of things that fresh advertisements are issued and the Corporation would not act on the old advertisements in order to bring proper present price. ( 45 ) IN 400 matters i. e. in Special Civil Application No. 3070 of 1986 and S. C. A. No. 6482 of 1987 sale is already effected. That will be considered separately. In Special Civil Application No. 3086 of 1986 possession has been taken and sale has been stayed on condition to deposit Rs. 50 0 That also will be considered separately. ( 46 ) IN rest of the matters there is not much to be considered separately. However same points were raised in some of these matters such as (I) That the corporation had not advanced full amount of loan sanctioned and the remaining amount of the loan was not paid and was canceled and therefore there is breach of promise by the Corporation and the Corporation is stopped by promissory estoppel from recovering the amounts already advanced. (ii) That the unit is a Sick unit and the Corporation is under a duly to help revival of such sick unit and therefore the recovery cannot be enforced. (ii) That the unit is a Sick unit and the Corporation is under a duly to help revival of such sick unit and therefore the recovery cannot be enforced. (iii) That the Corporation is under a duty to rehabilitate and not to kill Industrial units by coercive recovery. (iv) That the running unit should not be entered to be closed down by enforcing recovery under Sec. 29. All those arguments or not paying the amounts due and for avoiding and delaying the day of reckoning. After the amount of loan is sanctioned it is for the industrial unit to avail of the same by producing necessary vouchers and proof and availing of the loan. In none of the cases it has been shown that the industrial unit had wanted to avail of the balance amount of the loan in due time by producing the requisite documents. The Corporation is not bound to keep its committed idle for a long time. It is true that the Corporation charges commitment charges but the Corporation is not expected to keep its funds frozen with a view to get commitment charges. The Corporation has more important duty to promote industrial growth and not to keep its funds committed idle. The Corporation is therefore entitled to cancel the remaining outstanding loan after due and reasonable time. In fact none of the unit had complained of non-payment of the balance amount of the sanctioned loan. It is only when coercive recovery is threatened that they have come out to stop recovery in the name of balance amount of the outstanding loan. As regards sick units and its rehabilitation it is for the concerned industrial unit to satisfy that it is a credit worthy trustworthy and bona fide debtor not by its words and promises but by acts. Even if the given unit is viable it in the debtor who has further to show that is bona file and genuinely interested in making the payment and that has to be proved by making such payments of substantial part of the debt and by offering reschedulement and balance payment within a reasonable period. If the debtor is unable to make substantial payment even after lapse of a long time and does not offer reschedulement and balance payment within a reasonable time it cannot be said that the Corporation is failing to revive that unit. If the debtor is unable to make substantial payment even after lapse of a long time and does not offer reschedulement and balance payment within a reasonable time it cannot be said that the Corporation is failing to revive that unit. In fact by sale of such unit to a new entrepreneur the unit is more likely to be rehabilitated and restarted by the new entrepreneur. If the question is of revival of the unit and not of revival of the debtor it is change of ownership which is more likely to help rehabilitation and revival. Even in case of a running industry if the industry run by a debtor is unable to Generate any funds for repayment of its dues to the Corporation for a long time it cannot be said that the Corporation should indefinitely stay recovery. In the facts of these cases most of the industries are closed given those which are running are not making payments of their dues to the Corporation. In those circumstances it cannot be said that there is any case made out for restraining the Corporation from proceeding under Sec. 29. In many of these cases the debtors had made offers of reschedulement. The Corporation did not accept those offers because the payments were not reasonably substantial and the reschedulement period was beyond reasonable length and installments wore not proper and they were on the lower side Even 80 the debtors did not make the payments even according to their own offer of reschedulement. This shows lack of bona fides on the part of the debtors. During the course of the hearing the Corporation bad offered reschedulement to the debtors who paid 30% of the outstanding dues and the balance payment by installments within a period of 2 to 3 years. Quite a few of the industrial units availed of that opportunity and settled the matter and withdrew the petitions The cases which have remained are of such industrial units which are unable to pay or do not want to pay and yet want to restrain the recovery. Naturally the Court cannot help them against public interest and against the provisions of law. ( 47 ) IN view of the aforesaid discussion all these petitions are required to be dismissed and rule is required to be discharged and interim relief is required to be vacated. Naturally the Court cannot help them against public interest and against the provisions of law. ( 47 ) IN view of the aforesaid discussion all these petitions are required to be dismissed and rule is required to be discharged and interim relief is required to be vacated. Where only notice is issued it is required to be discharged. ( 48 ) IN the result all these petitions fail. Rule Notice is discharged. Interim relief wherever granted is vacated ( 49 ) IN Special Civil Application No. 3986 of 1989 where possession has been taken by the Corporation and sale has been stayed on deposit of Rs. 50 0 the petitioner is directed to make written representation to the Corporation within two weeks from today to show how it proposes to discharge its liability to the Corporation by initial substantial payment and rest by installments. The representation shall be decided by the Corporation as expeditiously as possible and if necessary by calling the party for negotiations. If any amicable arrangement is worked out the question of sale would not survive and the possession should be restored to the petitioner. However if no such arrangement could be worked out the Corporation may take further steps under Sec. 29 of the Act in accordance with law. Subject to the aforesaid directions this petition is dismissed. Notice discharged. Interim relief vacated. ( 50 ) IN Special Civil Application No. 3070 of 1986 the dues of 1979 were more than Rs. 1 26 0 The default was committed in the year 1983 and after notice under Sec. 29 the property has been sold. It the petitioner has any ground for challenge that action of sale the petitioner will be at liberty to challenge the same by way of an independent action The Corporation is directed to render to the petitioner true and complete account of the sale and if there is any surplus to descries the same in accordance with law to the persons entitled to the same. Subject to the aforesaid directions this petition is also dismissed. Rule discharged. ( 51 ) IN Special Civil Application No. 6482 of 1987 the loan sanctioned in December 1982 was for an amount of Rs. 18 25 lacs. Subject to the aforesaid directions this petition is also dismissed. Rule discharged. ( 51 ) IN Special Civil Application No. 6482 of 1987 the loan sanctioned in December 1982 was for an amount of Rs. 18 25 lacs. As there were defaults in payments at installments show cause notice was issued on 1/10/1986 Another notice was issued on 14/02/198 7/03/1987 the petitioner was called before the Recovery Review Committee where the petitioner agreed to pay a sum of Rs. 2 lacs before the end of March 1987 and Rs 1 and every year. But the petitioner failed to comply. A notice under Sec. 29 was issued and thereafter an advertisement for sale was issued on 23/06/1987 petitioner issued a cheque for Rs. 75 0 but it was dishonored and returned uncashed. As on 31/03/1988 the total dues claimed by the Corporation are Rs. 26 45 45 In the petition no interim relief was 8ranted and thereafter the sale has taken place. If the petitioner has any ground for challenging that action of sale the petitioner will be at liberty to challenge the same by way of an independent action. The Corporation is directed to render to the petitioner true and complete account of the sale and if there is any surplus to disburse the same in accordance with law to the persons entitled to the same. Subject to the aforesaid directions this petition is also dismissed. Rule discharged. ( 52 ) IN all these petitions the petitioners will pay the costs of the respondents. ( 53 ) THE learned Counsel for the petitioner on Special Civil Application No. 6630 of 1985 prayed that certificate for appeal to the Supreme Court be granted. In our opinion no substantial question of law of general importance which needs to be decided by the supreme Court arises in this case and as such the prayer for certificate or appeal to the Supreme Court is rejected.