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2004 DIGILAW 1191 (PAT)

National Ply Product v. State Of Bihar

2004-12-01

AFTAB ALAM

body2004
Judgment 1. The eight petitioners before this court are plywood manufacturing units, The petitioner units are represented either by their respective Directors or by one of the partners of the firm that owns the unit. Each of the petitioner units is said to have been set-up prior to 12.12.1996; on that date, in an order passed in the case of T.N. Godavarman Thirumalpad, the Supreme Court had issued a number of important directions aimed to protect the countrys forests. 2. The petitioners are aggrieved by and seek to challenge the notices, dated 12.8.2004 (Anenxure 12 series) by which the units are asked to shut down, failing which necessary steps would be taken against them. In the notices to the petitioners (that are quite identical) reference is made to a letter, dated 10.7.2003 written to the Principai Chief Conservator of Forest by the Director, Social Forestry, Govt. of Bihar, in para 5 of which it was stated that plywood and veneer units that were operating without regular licence should be closed down immediately and penal measures should be taken against those units. It is further stated that following that letter notices were issued on 29.8.2003 asking the respective units to close down and now the (impugned) notices were being issued again asking the units to shut down immediately. 3. To the petitioners the impugned notices appear to be a piece of highly capricious and whimsical action on the part of the State Government. It is pointed out that by an amendment made in section 2(g) of the Bihar Saw Mills (Regulation) Act, 1990 on 22.4.2002 veneer and plywood manufacturing units were also brought within the definition of saw mill. Following the amendment, the Secretary, department of Forests and Environment, Govt. of Bihar issued a notice in the Hindi daily Dainik Jaagran on 26.7.2002. By that notice all veneer mills and plywood manufacturing units, set up after 12.12.1996 were directed to be shut down with immediate effect. But in so far as the units set-up prior to 12.12.1996 are concerned, their operators were asked to make application for licence for operating the unit before the concerned Divisional Forest Officer, in Form B of the Bihar Saw Mill (Regulation) Rules, 1993, by 31.7.2002. It is stated on behalf of the petitioners that all of them submitted applications for grant of licences in proper forms, duly complying with the requirements for making such application. It is stated on behalf of the petitioners that all of them submitted applications for grant of licences in proper forms, duly complying with the requirements for making such application. Their applications were pending before the concerned authority and in the meanwhile the impugned fiat was issued asking the units to be shut-down in the most arbitrary manner. 4. It was contended on behalf of the petitioners that since their applications for licence, made within the time allowed by the notice issued by the State Government, remained pending for consideration, it would be deemed that they were granted licences under the Act, as laid down in the proviso to section 5(2) of the Act. Hence, the petitioners units could not be said to be operating without licences and directed to shut down for that reason. 5. Before proceeding further it may be noted that though there are only eight petitioners before the court, in course of hearing of the case it came to light that every plywood manufacturing unit in the State was given a similar notice to close down immediately. 6. On behalf of the State it is admitted that following the amendment in section 2(g) of the Saw Mills (Reg.) Act a public notice was issued on 26.7.2002 asking those plywood manufacturing units that/were established before 12.12.1996 to apply for licences by 31.7.2002. It is also admitted that the petitioners (and some other units) had submitted their respective applications by the date fixed in the notice. But the blanket prohibition against all plywood manufacturing units in the State is sought to be justified on the basis of an order by the Supreme Court. Mr. R.K. Dutta, learned counsel appearing for the State stated that it was not the intent of the State Govt. to shut down all veneer mills and plywood manufacturing units in the State but the Government was obliged to do so to carry out and enforce the directive of the Supreme Court as contained in the order, dated 29.10.2002 passed in T.N. Godavarman Thirumalpad. Mr. Dutta pointed out that in that order the Supreme Court had, inter alia, directed : "No State or Union Territory shall permit any unlicensed saw-mills, veneer, ply wood industry to operate and they are directed to close all such unlicensed units forth-with". 7. Mr. Dutta pointed out that in that order the Supreme Court had, inter alia, directed : "No State or Union Territory shall permit any unlicensed saw-mills, veneer, ply wood industry to operate and they are directed to close all such unlicensed units forth-with". 7. There was, therefore, no option for the State Government but to close down all veneer mills ano plywood units, including the petitioner units. 8. When asked why steps were taken for the enforcement of the Supreme Court direction after such a long time and when and how did the State Government realise that all the plywood manufacturing units in the State were liable to be closed down in pursuance of the order passed by the Supreme Court on 29.10.2002, the State counsel was unable to give any satisfactory reply. All that Mr. Dutta said was that the concerned officials would not be absolved from carrying out the direction of the Supreme Court simply because they did not take the necessary steps for the enforcement of the order soon after it was passed. 9. In order to see the matter in its proper perspective, it is essential to take note of some antecedent facts. On 12.12.1996 the Supreme Court passed the order in T.N. Godavarman Thirumalpad, inter alia, directing each of the State Governments to constitute a committee to assess the sustainable capacity of the forests of the State. The relevant portion of the order is as follows: "7. Each State Government should constitute within one month, an Expert Committee to assess : "(i) the sustainable capacity of the forests of the State qua saw mills and timber based industry; "(ii) the number of existing saw mills which can safely be sustained in the State; "(iii) the optimum distance from the forest, qua that State, at which the saw mill should be located. "8. The Expert Committee so constituted should be requested to give its report within one month of being constituted." 10. ln pursuance of the order, the Govt. of Bihar constituted the Expert Committee vide notification no. 274, dated 24.1.1997. The Expert Committee submitted its report on 7.8.1997 (which, for the sake of convenience, may be called as the 1st report). This report was produced before the Supreme Court as part of an affidavit, filed by the State Government on 9.12.1997. ln pursuance of the order, the Govt. of Bihar constituted the Expert Committee vide notification no. 274, dated 24.1.1997. The Expert Committee submitted its report on 7.8.1997 (which, for the sake of convenience, may be called as the 1st report). This report was produced before the Supreme Court as part of an affidavit, filed by the State Government on 9.12.1997. The Expert Committee in its report found that there were 3991 saw mills in operation in the State. Having regard to the sustainable capacity of the forests in the State it recommended that 1110 saw mills may be allowed to operate and the remaining 2881 should be closed down in a phased manner over a period of three years. The first report by the Expert Committee came when the State of Bihar had not been divided and its recommendations were, therefore, in regard to the undivided State. 11. On the basis of the report of the Expert Committee the State Govt. took the decision to fix the numbers of timber based industries as (i) 1950 saw mills (that is, 840 in excess of the number recommended by the Expert Committee), (ii) 109 plywood manufacturing units and (iii) 265 veneer mills. The State Govt. further decided to close down 733 unlicensed saw mills immediately and the rest, in excess of the fixed number, in a phased manner. The decision of the State Govt. was communicated to the Principal Chief Conservator of Forest vide letter no. 343E, dated 28.10.2000. 12. It may be noted here that unlike saw mills, the Expert Committee did not recommend any reduction in the numbers of the veneer mills any plywood manufacturing units. Hence, the decision of the State Government fixed the numbers of plywood manufacturing units (109) and veneer mills (265) as were in existence in the undivided State at the time of submission of the first report. This was on the assumption that veneer mills and plywood manufacturing units would get their requirement of timber from the licensed saw mills and through import. 13. The decision of the State Govt. to close down a large number of saw mills and following it the refusal of the concerned authorities to renew/grant licences under the Saw Mills (Reg.) Act gave rise to a spate of writ petitions. 13. The decision of the State Govt. to close down a large number of saw mills and following it the refusal of the concerned authorities to renew/grant licences under the Saw Mills (Reg.) Act gave rise to a spate of writ petitions. All those writ petitions were dismissed by a learned single Judge by judgment and order, dated 29.9.2000 [reported as BasudeoYadav V/s. the State of Bihar in 2001(1) PLJR 468 ]. Against the judgment and order passed by the single Judge appeals were preferred by saw mill owners. Those appeals too were dismissed, though subject to certain observations and directions vide judgment and order, dated 10.1.2002 [reported as Basudeo Yadav V/s. State of Bihar in 2002(1) PLJR 551 ]. While declining to interfere in the matter, the L.P.A. bench expressed its concern over the way in which the State Govt. proposed to identify 1950 saw mills (for the entire State) or one saw mill for a population of 50,000 as the case might be. The bench observed that it was one thing to fix the number of saw mills on the basis of sustainable capacity of forests but something quite different to identify the sustainable saw mills which were to be allowed to operate. The court also observed that since a large number of saw mills were running under valid licences, any decision as to which one of them should be allowed to continue and which one should be closed within a period of three years would require due care and caution. That obviously could not be done on a pick and choose basis and some norms had to be laid down. Thus, expressing its concerns the court advised the State Govt.to appoint a committee of experts/officers to identify the saw mills that would be allowed to continue and those that would be closed down. 14. In pursuance of the judgment of the L.P.A. bench the State Govt.set up the second expert committee vide notification no. 232E, dated 5.4.2002. The expert committee submitted its report (commonly called the second report) on 27.4.2002 on the basis of which the State Govt. issued resolution no. 418E, dated 8.7.2002. By that resolution the Government fixed the total number of saw mills at 1450 on the basis of the sustainable capacity of the forests in the truncated Bihar. 232E, dated 5.4.2002. The expert committee submitted its report (commonly called the second report) on 27.4.2002 on the basis of which the State Govt. issued resolution no. 418E, dated 8.7.2002. By that resolution the Government fixed the total number of saw mills at 1450 on the basis of the sustainable capacity of the forests in the truncated Bihar. (It may be recalled here that on the basis of the first report the number of saw mills was fixed at 1950, out of which 500 were for South Bihar. Hence, after division of the State the total number of saw mills was brought down to 1450 that were located in north Bihar). The resolution further laid down the norms for distribution of the 1450 saw mills, mainly on the basis of population and the relative demand of timber in the rural and urban areas. The resolution further laid down the norms for issuing new licences and/or for shutting down the saw mills being in excess of the fixed number. 15. The issuance of resolution no. 148E, dated 18.7.2002 once again brought a large number of writ petitions to this court. All those writ petitions were dismissed by me by order, dated 5.12.2002 [reported as Narayan Pd. Sah V/s. State of Bihar in 2003(1) PLJR 343 ]. In that order it was noticed that by an order passed in T.N. Godavarman Thirumalpad the Supreme Court had constituted a Central Empowered Committee for monitoring the implementation of its orders and had vested it with certain powers and functions. It was further noticed that on 9.9.2002 a draft of the proposed notification under section 3(3) of the Environment (Protection) Act, 1986 constituting the General Empowered Committee was submitted before the court and on that date the Supreme Court had passed an order directing that whatever functions and responsibilities had been given to the Empowered Committee would now be discharged by the statutory committee formed under section 3(3) of the Environment (Protection) Act. Having regard to the fact that the aggrieved saw millers had thus available to them a forum constituted by virtue of the order of the Supreme Court, this court declined to interfere in the matter, leaving it open to the petitioners to move and approach the General Empowered Committee. 16. Having regard to the fact that the aggrieved saw millers had thus available to them a forum constituted by virtue of the order of the Supreme Court, this court declined to interfere in the matter, leaving it open to the petitioners to move and approach the General Empowered Committee. 16. It may be noted here that upto this stage it was the saw mills that were under focus in the two reports of the expert committees and the Government decisions based on the two reports. Determined on the basis of the sustainable capacity of forests in the State, the number of saw mills was greatly reduced from their existing number and consequently all the litigations upto this stage were at the instance of the aggrieved saw millers. Veneer mills and plywood manufacturing units were, till this stage, out of the controversy and the number fixed for these two categories were the same as their existing numbers. This was apparently because the Saw Mills (Regulation) Act, as it then stood did not cover either a veneer mill or a plywood manufacturing unit and timber industries in those two categories did not require any licence under the Act. 17. By notification, dated 20.4.2002, published in the official gazette of 22.4.2002 an amendment was introduced in section 2(g) of the Bihar Saw Mills (Regulation) Act, 1990. Section 2(g) defines saw mill and before its amendment it was as follows : "2 (g) "Saw mill" means the plant and machinery with which and the premises including the precincts thereof in which or in any part of which sawing is carried with the aid of electrical or mechanical power." 18. By the amendment the following sentence was added at the end of the definition : "It shall also include veneer plywood manufacturing unit." 19. Following the amendment the Secretary to the Government in the Department of Forest & Environment wrote to the Principal Chief Conservator of Forest vide letter no. 2098, dated 29.6.2002 intimating him about the amendment that brought veneer and plywood manufacturing units within the ambit of the Act. Following the amendment the Secretary to the Government in the Department of Forest & Environment wrote to the Principal Chief Conservator of Forest vide letter no. 2098, dated 29.6.2002 intimating him about the amendment that brought veneer and plywood manufacturing units within the ambit of the Act. It was further said in the letter that in an affidavit filed before the Supreme Court in September, 1990, it was stated on behalf of the State Government that 265 veneer and 109 plywood mills established prior to 12.12.1996 in the State would be given permission to run and new veneer/plywood mills would not be allowed. Those numbers for veneer and plywood mills were for undivided State. The Supreme Court was also informed that the plywood mills would meet their timber requirement either from legally operated saw mills or veneer mills or through import. The plywood/veneer mills were prohibited from obtaining the required timber from any other source. The letter went on to say that following the amendment in the Act, two steps were required to be taken; (i) all veneer and plywood mills established after 12.12.1996 should be closed down by 31.7.2002 and (ii) all those veneer and plywood mills that were established before 12:12.1996 should be directed to submit applications for obtaining licence. The letter further indicated the matters to be gone into before the Government would take a decision regarding issuance of licences under the Act to the applicants. 20. On 26.7.2002 a notice as suggested in the Secretarys letter of 29.6.2002, was issued in the Hindi daily Dainik Jaagran.The notice directed all the veneer mills and plywood manufacturing units that were set up after 12.12.1996 to close down immediately. Those veneer mills and plywood manufacturing units that were set-up prior to 12.12.1996 were directed to make applications in the prescribed Form B for grant of licences under the Act by 31.7.2002. All the eight petitioner units claim that those were set-up prior to 12.12.1996 and applications for grant of licences were made on behalf of each of them by 31.7.2002. 21. All the eight petitioner units claim that those were set-up prior to 12.12.1996 and applications for grant of licences were made on behalf of each of them by 31.7.2002. 21. While the matter of grant of licences to the petitioners and other similarly situated plywood manufacturing units was pending before the Government, the Supreme Court on 29.10.2002 passed an order in T.N. Godavarman Thirumalpad, the portion of which, so far as relevant for the present, it reproduced below : "No State or Union Territory shall permit any unlicensed saw-mills, veneer, plywood industry to operate and they are directed to close all such unlicensed unit forthwith. No State Government or Union Territory will permit the opening of any saw-mills, veneer or plywood industry without prior permission of the Central Empowered Committee. The Chief Secretary of each State will ensure strict compliance of this direction. There shall also be no relaxation of rules with regard to the grant of licence without previous concurrence of the Central Empowered Committee." 22. The State Government took no action when the order was passed. 23. Coming back to further developments in the cases, filed by the aggrieved saw millers of the State it was noted above that in the last batch of writ petitions the High Court had declined to interfere and had left it open to the petitioners to approach and move the Empowered Committee. Following the order of this court a number of I.As. were filed by the aggrieved saw millers before the Empowered Committee against resolution no. 418E, dated 8.7.2002 issued by the State Government. All those I.As. were disposed of by the Empowered Committee by its order, dated 16.4.2002 (Annexure F to the counter affidavit filed by the State). 24. Before the Empowered Committee the aggrieved saw millers questioned the decision of the State Government to drastically reduce the number of saw mills but to maintain the numbers of veneer and plywood mills at their existing numbers. It was contended that it was wrong to consider veneer and plywood mills as secondary consumers of timber. Those units in fact consumed more timber and in order to preserve the forests those units were required to be closed down before any saw mill. 25. It was contended that it was wrong to consider veneer and plywood mills as secondary consumers of timber. Those units in fact consumed more timber and in order to preserve the forests those units were required to be closed down before any saw mill. 25. The stand of the State Government before the Empowered Committee, as appearing from its order, was as follows: In undivided Bihar, there were 3,991 private saw mills, 61 Government saw mills, 109 plywood mills and 265 veneer mills out of these 2,090 saw mills, 3 Government saw mills, 67 plywood factories and 246 veneer mills are located in present North Bihar. The First Expert Committee, after considering the availability of wood had recommended 310 saw mills of South Bihar and 800 saw mills of present North Bihar i.e. total 1,110 saw mills to be allowed to operate and the excess saw mills were to be closed down in a phased manner. For this purpose, the capacity of the saw mill has been taken as 500 cu. m. per year in South Bihar and 400 cu. m. per year in North Bihar. No. recommendations have been made with regard to the Government owned saw mills, plywood mills or veneer mills. After considering the report of the PCCF and other relevant information the State Government had decided to allow 1,950 saw mills, 265 veneer saw mills and 109 saw mills to operate, i.e. 840 saw mills more than the recommended number. This comprises of 1,450 saw mills located in North Bihar (present Bihar) and 500 saw mills for undivided South Bihar. The same number of saw mills i.e. 1,450 saw mills have been retained in the present Bihar. The Second Expert Committee has not recommended any changes in the number of saw mills that should be allowed to operate. It has only identified the saw mills and made recommendations which ones should be allowed to operate and which should be closed down. "In respect of plywood mills the State Government has taken a decision that they will obtain their raw material from licensed veneer mills or licensed saw mills and depots or from imports. Veneer saw mills will have to obtain their raw material either from the saw mills or by imports. Since they were not to be primary consumer of wood, such unit were not closed down."(emphasis added) 26. Veneer saw mills will have to obtain their raw material either from the saw mills or by imports. Since they were not to be primary consumer of wood, such unit were not closed down."(emphasis added) 26. On a consideration of the submissions made on behalf of the parties the Empowered Committee noted the fact that the State of Bihar was the first to regulate the number of wood-based industries and the State Government had taken material steps for giving effect to the order of the Supreme Court, dated 12.12.1996. The Committee also approved, in principle, the exercise undertaken by the State Govt. but it cast serious doubt over the way the First Expert Committee had addressed the problem. The Empowered Committee took the view that veneer mills and plywood factories too, like saw mills, were primary consumer of wood; that it was an error to consider those industries as secondary consumers and to assume that their requirement of timber would be met from the licensed saw mills and through import. 27. In that view the Empowered Committee was of the view that the State Govt. should re-examine the matter in the light of its observations. The relevant portion of the order of the Empowered Committee is as follows : "In view of the above observations the Committee is of the view that the State of Bihar should re-examine the availability of timber from all sources, including timber available from non-forest area, timber imported from other States and from other countries. In addition to private saw mills, the timber requirement of Government owned saw mills, plywood factories and veneer factories should also be worked out. Depending upon availability of timber and installed capacity of wood based industries and apply equitable and non-discriminatory criteria the State Government should work out the total number of the wood based units in different categories i.e. saw mills, Government saw mills, plywood units and veneer units which can be allowed to continue. Depending upon availability of timber and installed capacity of wood based industries and apply equitable and non-discriminatory criteria the State Government should work out the total number of the wood based units in different categories i.e. saw mills, Government saw mills, plywood units and veneer units which can be allowed to continue. A seniority list of different categories of wood based units should be prepared at the State level and number of units which can operate on sustainable basis in each category should be allowed to continue on the principle of first come last go." Further : "The Committee is not recommending reopening of any of the saw mills closed by the State Government till the exercise is completed as the Committee is of the view that total numbers of saw mills already allowed to operate by State Government may be much more than the raw material (timber) available on sustainable basis. However, closure of some of the plywood/veneer factories on first come last go should be considered till the exercise is completed by the State Government." 28. The order passed by the commitee was placed before the Supreme Court and by order, dated 18.8.2003 its recommendations were approved by the Supreme Court in the following manner : "Heard learned counsel for the parties and perused the counter affidavit filed on behalf of the State of Bihar as well as the recommendations of C.E.C. in I.A. Nos. 782-784, 793-795 & 812-815 (with I.A. Nos. 842, 843 & 843A in 782- 84 & I.A. Nos. 844, 845 & 845A in 73-795). "When this matter was taken up, learned counsel appearing for the State of Bihar stated that the State Government has no objection in accepting the recommendations of C.E.C. with the modification that instead of number of wood-based units to be allowed at the State level, they should be allowed at the District level and further an appeal against the decision of the District Committee or the PCCF be preferred to the District Judge of the competent jurisdiction. "We feel that the recommendations made by C.E,C. with the aforesaid modification, are required to be accepted. We, therefore, accept the recommendations and direct the State of Bihar to implement the said recommendations forthwith. "I.As. stand disposed of." 29. Following the recommendation of the Empowered Committee and its approval by the Supreme Court the State Govt. "We feel that the recommendations made by C.E,C. with the aforesaid modification, are required to be accepted. We, therefore, accept the recommendations and direct the State of Bihar to implement the said recommendations forthwith. "I.As. stand disposed of." 29. Following the recommendation of the Empowered Committee and its approval by the Supreme Court the State Govt. constituted another committee under the Principal Chief Conservator of Forest vide notification no. 765E, dated 14.11.2003. 30. It was in this background that on 12.8.2004 the impugned notices of closure were abruptly issued to all plywood manufacturing units in the State, including the petitioners before this court. About a fortnight later, the third committee constituted as per the recommendation of the Empowered Committee submitted its report on 25.8.2004. Dealing with plywood mills, the (third) report recommended that the plywood mills should be kept apart and out of the number fixed for saw mills and veneer mills. Though treating them as a separate category, plywood units should also be required to be registered under the Saw Mills (Reg.) Act and the provisions of the Act would apply to those units. But those units would not come within the number fixed for saw mills. The report further recommended that subject to certain conditions regulating the purchase of raw materials and the sale of the end product by the plywood mills, the number of plywood mills for the next five years should be limited to those in existence that (i) were set up prior to 12.12.1996 and (ii) were in continuous operation. 31. The State Govt. is yet to take a decision on this report that was submitted on 25.8.2004. 32. The validity and justifiability of the action of the State Govt. in closing down all plywood manufacturing units in the State, including the petitioners, is to be judged in the background of the aforesaid facts and circumstances. 33. Mr. R.K. Dutta submitted that on the date of issuance of the impugned notices the plywood manufacturing units were indisputably operating without valid licences and hence, there was no way out but to close all the units, regardless of consequences, in the light of the order passed by the Supreme Court on 29.10.2002. 34. Mr. 33. Mr. R.K. Dutta submitted that on the date of issuance of the impugned notices the plywood manufacturing units were indisputably operating without valid licences and hence, there was no way out but to close all the units, regardless of consequences, in the light of the order passed by the Supreme Court on 29.10.2002. 34. Mr. Y.V. Giri, learned Senior Advocate, appearing for the petitioners, on the other hand contended that it was quite wrong and incorrect to suggest that the petitioners did not have valid licences on the date of issuance of the closure notice. He submitted that by virtue of the proviso to section 5(2) of the Act, it would be deemed that the petitioners were granted licences under the Act. 35. Mr. Dutta took the extreme position, viewed from where it would appear that every plywood mill in the State was set-up and was allowed to operate for years together without complying with the requirement of licence under the Act and hence, quite illegally. He contended that the amendment introduced in the definition of "saw mill" under the Act on 22.4.2002 was merely clarificatory and the plywood manufacturing units were fully covered by the definition even before its amendment. Mr. Dutta tried to support the contention by referring to the definition of saw mill as contained in section 2{g) before its amendment. He submitted that the key to the definition was the process of sawing with the aid of electrical or mechanical power. He then referred to the definition of sawing in section 2(i) of the Act which is as follows : "(i) "sawing" with its grammatical variations and cognate expressions means operations of sawing, cutting, converting, fashioning or seasoning wood and includes preservation and treatment thereof either by mechanical process with the aid of electrical or mechanical power of manually-operated saws." 36. Mr. Dutta submitted that in every plywood manufacturing unit there was undeniably a sawing machine and in every unit some work of sawing or cutting was carried on and hence, all plywood mills would qualify, as saw mill even under the unamended definition. In support of the submission he relied upon a Supreme Court decision in State of U.P. & Another V/s. Union of India & Another, (2003)3 SCC 239 . 37. In reply Mr. In support of the submission he relied upon a Supreme Court decision in State of U.P. & Another V/s. Union of India & Another, (2003)3 SCC 239 . 37. In reply Mr. Giri submitted that as a matter of fact no sawing operation was involved in the manufacture of plywood and there was no occasion for any sawing in a plywood mill. A plywood mill may normally keep a simple sawing tool but that was used only for cutting the plywood boards to the desired sizes and shapes. Mr. Giri further submitted that if the definition of sawing was given a simplistic and literal interpretation then even a humble workshop of an ordinary carpenter must he held as a saw mill because there too wood is cut and sawed, either by a hand-saw or a mehanical or electrical saw, for converting and fashioning it into furniture and other articles of domestic use. 38. I am unable to accept the extreme proposition advanced by Mr. Dutta. A clarificatory amendment is not unknown to law but that does not mean that every amendment would be a clarificatory amendmerit. Though the Saw Mill (Regulation) Act was enacted on 7.12.1990, veneer and plywood mills were never treated as being covered by its provisions till the amendment of the definition of saw mill on 22.4.2002. Moreover, the letter, dated 29.6.2002 written by the Secretary, Forest & Environment Department, Govt. of Bihar to the Principal Chief Conservator of Forest after the amendment in question makes the stand of the State Govt. plain and clear that veneer and plywood manufacturing units were brought within the ambit of the Act only by virtue of the amendment in the definition of saw mill. The decision in the State of U.P. (supra) has no application to the facts of this case. That decision was rendered in a case arising under the U.P. Trade Tax Act. In that decision the Supreme Court held that the insertion of clause (29-A) in Art. 366 of the Constitution and following it the consequential amendment of the term "sale" was sufficiently wide to include the Government as a dealer and, therefore, the later insertion of sub-clause (viii) in section 2(c), (containing the definition of dealer) would not materially affect the position. In coming to this conclusion the court also took note of the statement of objects and reasons of U.P. Act 31 of 1995 wherein it was declared that sub-clauses (vii) and (viii) were added in the definition of the term "dealer" to remove difficulty in the assessment of tax in the transaction relating to transfer of a right to use any goods. 39. I have, therefore, no hesitation in holding that the submission that plywood manufacturing units were covered by the Act even before the amendment in the definition of "saw mill" is unacceptable and the reliance placed in the case of State of U.P. (supra) is quite misconceived. 40. Equally unacceptable is the contention of Mr. Giri that having submitted their applications within the time prescribed by the notice, the petitioners would be deemed to have been granted licences under the Act in terms of the proviso to section 5(2) of the Act. The proviso was added to section 5(2) since it was essential to allow some time to obtain licences to those saw mills that were already in operation before the framing of the Act. Section 5 reads as follows : "5. Application for licence.On and from the appointed day (1) no person shall establish a saw mill or a saw pit except under the authority and subject to the conditions of a licence granted in that behalf under this Act; (2) no person shall operate a saw mill or a saw pit in existence on the said date, unless he is granted a licence in that behalf under this Act on an application made by such person within a period of thirty days from such date : "Provided that for the period of thirty days and thereafter the period during which the application is pending consideration, it shall be deemed as if such person was granted in licence under this Act and he was operating the saw mill or saw pit accordingly." 41. The appointed day is defined in section 2(a) to mean the date appointed under sub-section (3) of section 1 which was May 1, 1990. Now even if the "appointed day" is to be shifted with regard to the amendment of section 2(g) of the Act, it cannot go beyond the date on which the Amendment Act (Bihar Act 4 of 2002) was published in the official gazette; that date is 22.4.2002. Now even if the "appointed day" is to be shifted with regard to the amendment of section 2(g) of the Act, it cannot go beyond the date on which the Amendment Act (Bihar Act 4 of 2002) was published in the official gazette; that date is 22.4.2002. Hence, the protection under the proviso would in any event come to an end on expiry of thirty days from 22.4.2002, The issuance of the general notice after the period of thirty days was over would not extend the period laid down in the statute and hence, the petitioners cannot seek protection of the proviso on the basis that they filed the applications for licences within the time allowed by the notice. 42. Thus, strictly speaking the petitioners do not enjoy the protection of any statutory provision. But that is not to say that they do not have the protection afforded by the principles of equity, good conscience and fair-play. In any view the Government must not act in an unreasonable or arbitrary manner which it clearly appears to have done in this case as becomes evident from the following facts. The petitioner units were established before 12.12.1996 when there was no requirement of licence under the Act. Following the amendment, the notice was issued on 26.7.2002 in pursuance of which afi the petitioners made applications by 31.7.2002, the prescribed date under the notice. The Supreme Court order came three months later on 29.10.2002. The intent of the Supreme Court order was not to close down every single plywood mill in the State but only those that were being operated without licence. There was no reason for the licensing authority not to dispose of the applications filed by the petitioners during the period of three months. Had the petitioners applications been duly considered and disposed of within this period, this position would not have resulted. Thus, the action of the State Govt. in closing down all the plywood mills amounts to punishing the petitioners (and others similarly situate) for its own default and laches. 43. The report of the lst Expert Committee had found that there were 109 plywood mills in the undivided State. In the proceeding before the Empowered Committee it was stated on behalf of the State Govt. that there were 67 plywood factories located in the present North Bihar (that is, the truncated State). 43. The report of the lst Expert Committee had found that there were 109 plywood mills in the undivided State. In the proceeding before the Empowered Committee it was stated on behalf of the State Govt. that there were 67 plywood factories located in the present North Bihar (that is, the truncated State). In answer to a specific question by the court, Mr. R.K. Dutta stated that in response to the general notice, dated 26.7.2002 applications for licences were received from 45 plywood mills for Patna and on enquiry 23 were found to be in operation. It is, thus, clear that the number of the applicant units too was quite manageable and all the applications for licence could be easily disposed of within three months. 44. Moreover, to justify the direction for closure on the basis of the order of the Supreme Court passed about two years ago on 29.10.2002 appears to be quite stretched and contrived. It is noted above that after the order was passed on 22.9.2002 the matter was considered by the Empowered Committee and its recommendations, as contained in the order, dated 6.4.2003, were approved by the Supreme Court on 18.8.2003. It is, thus, clear that the matter cannot be viewed on the basis of the earlier order alone but it must also be seen in the light of the later order. The action of the State Govt. in issuing the impugned closure notices, therefore, cannot be justified or held to be reasonable from any point of view. 45. On the basis of the discussions made above it is held, declared and directed as follows : (i) The impugned notices, dated 12.8.2004 (Annexure 12 series) are declared invalid, inoperative and unenforcible. (ii) Consequently, the eight petitioners and other similarly situate plywood mills must be allowed to operate till such time as the application for licence filed by them in response to the general notice, dated 26.7.2002 may not be turned down for a reason sanctioned by law or till all or any of them may not be held to be in excess of the total number of plywood mills fixed for the State by the State Government. (iii) The concerned authorities are directed to dispose of the applications for licences made by the petitioners and other similarly situated plywood mills in response to the notice, dated 26.7.2002 within six (6) weeks from today. (iii) The concerned authorities are directed to dispose of the applications for licences made by the petitioners and other similarly situated plywood mills in response to the notice, dated 26.7.2002 within six (6) weeks from today. (iv) The State Government is directed to consider and take a decision on the basis of the report of the Third Expert Committee, dated 25.8.2004 within two (2) months from today. 46. This writ petition stands disposed of with the aforesaid observations and directions. There will be no order as to costs.