ivil Appeal Nos 815 and 1284 of 1978 Appeals by special Leave from the Judgment and order dated 20 12 1977 of the Delhi High Court in Civil Writ No 616176
Soli J Sorabjee A C Gulati A K Ganguli G section Chatterjee and B B Swahney for the Appellant in CA No 81578
Lal Narain Sinha Att
Miss A Subhashini and Girish Chandra for the Appellant in CA No 1284 and Respondent No 1 in CA No 815178
The Judgment of the Court was delivered by SEN J
These appeals by special leave against a judgment of the Delhi High Court turn on the construction of certain provisions of the 
The appeals raise a question of far reaching importance namely whether a raising contractor of a coal mine is an owner within the meaning of sub section
1 of section 4 of the hereinafter referred to as the Nationalisation Act and if so whether the fixed assets like machinery plants equipment and other properties installed or brought in by such a raising contractor vest in the Central Government
They also give rise to a subsidiary question namely whether subsidy receivable from the erstwhile Coal Board established under section 4 of the upto the specified date from a fund known as Conservation and Safety Fund by such raising contractor prior to the appointed day can be realised by the Central Government by virtue of their powers under sub section
3 of section 22 of the Nationalisation Act to the exclusion of all other persons including such contractor and applied under sub section
4 of section 22 towards the discharge of the liabilities of the coking coal mine which could not be discharged by the appointed day
To make the points intelligible it is necessary to state a few facts
By an agreement dated February 7 1969 made between Messrs Balihari Colliery Co Pvt
Ltd hereinafter referred to as the owner  of the one part and Messrs Industrial Supplies Pvt
Ltd hereinafter referred to as the petitioners  of the other part it was recited as follows WHEREAS the owners are the owners of a Working Colliery comprising an area of 800 Bighas more or less and known 379 as Balihari Colliery particularly described in the first Schedule A hereunder written held under the lease and subleases mentioned in the said Schedule and in connection therewith have built various structures dhewrahs coolie lines hereinafter referred to as the said buildings and also installed and put up various machinery plants tools implements and utensils hereinafter referred to as the said machinery therein AND WHEREAS the owners have appointed INDUSTRIAL SUPPLIES PRIVATE LIMITED as Managing Contractor of their said colliery and the said Managing Contractor has agreed to act as such Managing Contractor for the period and upon the terms and conditions herein contained Under the said agreement the petitioners were appointed to be the Managing Contractors of Kutchi Balihari Colliery for a period of 20 years
Under cl 7a the petitioners were required at their own cost to install fixed assets like equipment machinery and plants and also invest in the form of current assets like stores in the said colliery and to work the same as raising contractors
By cl
7b the additional machinery so installed and the chattels and utensils so brought in by the petitioners were to remain the property of the petitioners absolutely and on the determination of the agreement they were entitled subject to the provisions of cl 9 to remove such additional fixed assets and current assets
Clause 9 gave an option to the owners to purchase the additional machinery chattels and utensils referred to in cl 7
Clause 25 of the agreement is material for our purposes and it reads 25
That in case the said colliery is nationalised these presents shall stand determined and all moneys then due and owing by the owners to the Managing Contractor or by the Managing Contractor to the owners under the provisions hereof shall at once become due and payable by the owners to the Managing Contractor or by the Managing Contractor to the owners as the case may be
If as result of such nationalisation the machinery chattels and utensils installed at andor brought into the said colliery by the Managing Contractor under the provisions of clause 7 of these presents or any one or more of them or the buildings and structures created by it at the said colliery under the provisions of clause 8 of these presents are taken over by the authorities concerned then and in such event the Managing Contractor shall be entitled to compensation payable for or attributable to the said machinery chattels and utensils and the buildings and structures so taken over and the owners shall be entitled to receive compensation for all other properties comprised in the said colliery
 380 Under the said agreement the petitioners installed from time to
time various fixed assets like machinery plants and equipment and erected structures and raised new roads within the said colliery and brought in various current assets and movables for the efficient working of the said mine
The petitioners were also raising contractors in respect of another coking coal mine known as Khas Dharmaband Colliery  owned by Messrs Khas Dharmaband Colliery Co Pvt Ltd subsequently known as New Dharmaband Colliery 
They had similarly brought over various assets including stores which were being used in the said colliery
Under an agreement of October 1969 the New Dharmaband Colliery was brought over by Messrs Sethia Mining  Mfg Corporation Ltd An inventory was prepared of the assets like plants machinery and stores belonging to the petitioners which were lying in the colliery the value of which was approximately Rs 121000 On October 171 1971 the resident promulgated the Coking Coal Mines Emergency provisions ordinance 1971 to provide for 
the taking over by the Central Government in the public interest of the management of 214 coking coal mines and 12 coke oven plants including the coal mines in question pending nationalisation of such mines
The ordinance was replaced by the 
Thereafter Parliament enacted the to complete the process of nationalisation of the coking coal mines and coke oven plants
It was entitled as An Act to provide for the acquisition and transfer of the right title and interest of the owners of the coking coal mines specified in the First Schedule and the right title and interest of the owners of such coke oven plants as are in or about the said coking coal mines with a view to reorganising and reconstructing such mines and plants for the purpose of protecting conserving and promoting scientific development of the resources of coking coal needed to meet the growing requirements of the iron and steel industry and for matters connected therewith or incidental thereto  Appointed day under section 2a of the was October 17 1971 while that under section 3a of the  is May 1 1972
According to the petitioners the total value of the fixed and current assets and movables of Kutchi Balihari Colliery taken over by the Central Government on October 17 1971 was to the tune of Rs 118559100
As regards New Dharmaband Colliery they allege that between October 1969 and October 17 1971 Messrs Sethia Mining 381  Mfg Corporation Ltd had utilised some of the stores lying in the colliery to the extent of Rs 5000000 and the balance of the stores lying in the colliery as on October 17 1971 was approximately Rs 7200000
Since April 1969 when the petitioners became raising contractors of Kutchi Balihari Colliery and until October 17 1971 when the management of the said colliery was taken over by the Central Government the petitioners allege that they had undertaken at their cost operations for sand stowing and hard mining and had accordingly submitted bills to the Coal Board established under section 4 of the Coal Mines Conservation and Safety Act 1952 for subsidy through the owners from time to time
As on October 17 1971 the amount of subsidy payable to them was about Rs 450000
On May 5 1976 the petitioners filed a Writ petition in the Delhi High Court seeking a declaration that sub section
1 of section 4 does not provide for the acquisition of the right title and interest of the petitioners inasmuch as being raising contractors they were not an owner within the meaning of section 3n of the Nationalisation Act and therefore they were entitled to dismantle and remove the fixed assets like machinery plants and equipment installed in the two mines and also to remove the movables and current assets thereof like furniture stores etc
and were further entitled to recover the amount of subsidy of about Rs 450000 collected by the Central Government from the erstwhile Coal Board
They accordingly sought a writ or direction in the nature of mandamus requiring the Central Government to return the assets like machinery plants equipment and other assets and movables and all amounts collected by way of subsidy or other dues or in any event pay Rs 1635591 with interest thereon from May 1 1972 till the date of payment
The High Court substantially disallowed the claim of the petitioners holding that they fall within the meaning of the term owner  as defined in section 3n of the Nationalisation Act read with section 21 of the and that as such the various machinery plants equipment and other filled assets current assets and movables belonging to them lying in the two coal mines were included in the expression mine as defined in section 3i of the Nationalisation Act and therefore the right title and interest of the petitioners therein stood vested in the Central Government under sub section
1 of section 4 free from all incumbrances
It however held that the amount of subsidy of Rs 450000 receivable from the Coal Board by way of reimbursement towards cost of sand stowing and hard mining operations carried on by the petitioners could not be treated to be as an amount due to the coking coal mine within sub section
3 of section 22 and therefore could not be 382 utilised by the Central Government under sub section
4 of section 22 for discharge of the liabilities of the coking coal mine
It was contended by the petitioners that they were neither the owners nor immediate occupiers or managing contractors of the coal mines in question but were merely raising contractors thereof and therefore they did not come within the purview of the term owner  as defined in section 3n of the Nationalisation Act read with section 21 of the 
It was therefore said that the plants equipment and machinery and other assets and current assets and movables belonging to them as on October 17 1971 could not and did not vest in the Central Government under sub section 1 of section 4 of the Nationalisation Act
It was urged that the High Court was in error in construing the definition of the term owner  as defined in section 21 of the so as to include a raising contractor by laying emphasis on the words as if he were  in the last sentence of the definition and particularly so because the Act itself separately andor clearly distinguishes between an owner  and a contractor 
It was further contended that due to the absence of the word includes  in the last sentence in the definition of owner  in section 21 of the  a contractor  cannot be treated to be an owner 
It was said that the object of the fiction in section 21 of the was for the limited purpose of making such a raising contractor responsible for the due observance of the provisions of that Act and such a deeming provision could not be invoked for construing the purpose and object of the Nationalisation Act which were different ie for the purpose of acquiring machinery plants and equipment and other assets belonging to such raising contractor lying within the mine under sub section
1 of section 4 of the Act
We are afraid we cannot accept these contentions
The construction that is sought to be placed on the definition of owner  in section 3n of the Nationalisation Act read with section 21 of the  upon the basis of which the argument proceeds would if accepted frustrate the very object of the legislation
The Nationalisation Act provides by sub section
1 of section 4 that the right title and interest of the owners in relation to the coking coal mines specified in the First Schedule on the appointed day ie on October 17 1971 shall stand transferred to and shall vest absolutely in the Central Government free from all incumbrances
In the Nationalisation Act owner  is defined in section 3n thus 3n owner i when used in relation to a mine has the meaning assigned to it in the  383 ii when used in relation to a coke oven plant means any person who is the immediate proprietor or lessee or occupier of the coke oven plant or any part thereof or is a contractor for the working of the coke oven plant or any part thereof  Section 21 of the reads as follows 1 owner when used in relation to a mine means any person who is the immediate proprietor or lessee or occupier of the mine or of any part thereof and in the case of a mine the business whereof is being carried on by a liquidator or receiver such liquidator or receiver and in the case of a mine owned by a company the business whereof is being carried on by a managing agent such managing agent but does not include a person who merely receives a royalty rent or fine from the mine or is merely the proprietor of the mine subject to any lease grant or licence for the working thereof or is merely the owner of the soil and not interested in the minerals of the mine but any contractor for the working of a mine or any part thereof shall be subject to this Act in like manner as if he were an owner but not so as to exempt the owner from any liability In support of the contention that the petitioners could not be regarded as occupiers and therefore do not come within the definition of owner  under section 3n of the Nationalisation Act reliance was placed on the decision in The Chief Inspector of Mines  Anr
vs Lala Karamchand Thapar etc
While a raising contract may not be a lease and therefore the contractor not a lessee we find no reason why he should not be treated to be an occupier within the meaning of section 3n
Under the terms of the agreement dated February 7 1969 the petitioners acquired complete dominion and control over the colliery in question for a period of 20 years
It is common ground that the said agreement was by a registered instrument and even though this perhaps may not amount to a leases there can be no doubt that it was a licence coupled with a grant
The petitioners were by virtue of cl 7a of the agreement entitled to install at their own cost such additional machinery tramways ropeways etc
 in connection with the transport of coal raised and to bring in chattels for the purpose of discovery and removal of coal
They were entitled under cl 7b to remove such additional machinery that may be installed and such chattels and utensils as may be brought in by them to the said collieries unless of course the owners exercised their option to purchase the same under cl 9
In view of these terms it is futile to contend that the petitioners were not occupiers of the mines
They had the actual use and occupation of the coal mine in question
384 We have carefully gone through the judgment in Lala Karamchand Thapar s case and if we may say so the decision is distinguishable on facts
There the question was whether the managing agent of a company owning a colliery was an occupier of the colliery and the Court negatived this observing From the very collocation of the words immediate proprietor or lessee or occupier of the mine it is abundantly clear that only a person whose occupation is of the same character that is occupation by a proprietor or a lessee by way of possession on his behalf and not on behalf of somebody else is meant by the word occupier in the definition
Thus a trespasser in wrongful possession to the exclusion of the rightful owner would be an occupier of the mine and so be an owner for the purpose of the Act
 The Court further observed That must be because possession on behalf of somebody else was not in the contemplation of the legislature such occupation as to make the person in possession an occupier within the meaning of section 21 These observations if we may say so with great respect are rather widely stated
They are indeed susceptible of a construction that a raising contractor being in possession on behalf of a proprietor or the lessee of a mine in possession is not an occupier  within the meaning of section 3n of the Nationalisation Act read with section 21 of the 
We are quite sure that was not the intention of the Legislature
There is no reason why the word occupier  should not be understood to have been used in its usual sense according to its plain meaning
In common parlance an occupier  is one who takes  or more usually holds  possession Shorter oxford Dictionary 3rd edn vol 2 p 1433
In the legal sense an occupier is a person in actual occupation
The petitioners being raising contractors were under the terms of the agreement dated February 7 1969 entitled to and in fact in actual physical possession and enjoyment of the colliery and were therefore an occupier thereof
That being so the petitioners being in possession in their own right by virtue of the substantial rights acquired by them under the agreement were not in possession on behalf of somebody else and therefore the decision in Lala Karamchand Thapar s case cannot apply
It is next urged that the Nationalisation Act itself makes a distinction between an owner  and a managing contractor  there being separate provisions made with regard to both
It is said that in view of this
there is no legal justification to read the word contractor  385 for the word owner  in sub section
1 of section 4
The contention is wholly misconceived and cannot be accepted
The Nationalisation Act no doubt separately defines owner  and managing contractor 
The definition of managing contractor in section 3i reads 3i managing contractor means the person or body of persons who with the previous consent in writing of the State Government has entered into an arrangement contract or under standing with the owner of a coking coal mine or coke oven plant under which the operations of the coking coal mine or coke oven plant are substantially controlled by such person or body of persons  The words and expressions used and defined in the Act have the meaning respectively assigned to them unless the context otherwise requires 
The expression managing contractor  finds place in Chapter VI which deals with the power functions and duties of the Commissioner of Payments appointed under sub section
I of section 20 for the purpose of disbursing the amounts payable to the owner of each coking coal mine or coke oven plant
It appears in sub section
2 of section 26 which provides 2 In relation to a coking coal mine or coke oven plant the operations of which were immediately before the 17th day of October 1971 under the control of a managing contractor the amount specified in the First Schedule against such coking coal mine or in the Second Schedule against such coke oven plant shall be apportioned between the owner of the coking coal mine or coke oven plant and such managing contractor in such proportions as may be agreed upon by or between the owner and such managing contractor and in the event of there being no such agreement by such proportions as may be determined by the Court
 Under cl 25 of the agreement it was agreed upon between the parties that i in the event the colliery was nationalised the agreement shall stand determine and all moneys then due and owing by the owners to the petitioners and vice versa shall at once become due and payable and ii in the event of such nationalisation if the machinery 
chattels and utensils installed at andor brought into the colliery by the petitioners or the buildings and structures erected by them are taken over by the authorities they shall become entitled to compensation payable for or attributable to the said machinery chattels and utensils and buildings and structures so taken over and the owners shall be entitled to receive compensation for all other properties comprised in the said colliery
The expression managing contractor  as defined in section 3i of the Nationalisation Act comes into play only 386 for the purpose of appointment of compensation under sub section
2 of section 26
The submission that the term owner  used in sub section
1 of section 4 of the Nationalisation Act excludes a managing contractor  is against the scheme of the Act
The term owner  in sub section
1 of section 4 of the Act must bear the meaning given in the definition contained in section 3n
It was asserted that the petitioners were really not the managing contractors but wrongly described as such in the agreement
A bare perusal of the agreement would however be destructive of the argument
It is a document drawn consisting of 46 clauses defining the mutual rights and obligations of the parties
 The petitioners were conferred all the rights to work the mine for winning getting and raising coal
The so called remuneration  payable to them was virtually the price of coal supplied leaving to the owners a margin of profit
Even the liability for payment of rent royalty taxes etc
 in relation to the mine was saddled on the petitioners
In view of these terms they cannot be heard to say that they were not the managing contractors though they have been so described in the preamble to the agreement and in each and every clause thereof
It is however asserted that the functions of a managing contractor
namely appointment of managers were not entrusted to the petitioners but were actually assigned to Messrs Madhusudan  Co under a separate agreement
The submission is spelled out from the terms of cl 11 relating to employment of workers of the colliery
All that was done was that the erstwhile owners had by this clause reserved to them selves the power to appoint managers
Such reservation does not take the petitioners out of the definition of managing contractor under 6
3i of the Nationalisation Act as they still had substantial control over the mine
The plea that not they but someone else was the managing contractor is only an after thought
The petitioners having bound themselves by the terms of the agreement cannot be permitted to escape from the provisions of sub section
1 of section 4
as they come within the purview of the definition of owner  in section 3n of the Nationalisation Act
It is then argued in the alternative
that the term owner  as defined in section 3n of the Nationalisation Act read with s 21 of the does not in any event include a raising contractor
It is not suggested that a raising contractor does not come within the description of a contractor in section 21 but it is urged that the word includes  is not there
There was no need for Parliament to insert the word includes  because of the words as if he were 
Although the term owner  in common parlance in its usual sense connotes ownership of a mine
the term has to be understood in the legal sense as defined
387 Parliament with due deliberation in section 3n adopted by incorporation the enlarged definition of owner in section 21 of the to make the Nationalisation Act all embracing and fully effective
The definition is wide enough to include three categories of persons i in relation to a mine the person who is the immediate proprietor or a assesses or occupier of mine or any part thereof ii in the case of a mine the business whereof is carried on by a liquidator or a receiver such liquidator or receiver and iii in the case of a mine owned by a company the business whereof is carried on by a managing agent
such managing agent
Each is a separate and distinct category of persons and the concept of ownership does not come in
Then come the crucial last words but any contractor for the working of a mine or any part thereof shall be subject to this Act in like manner as if he were an owner but not so as to exempt the owner from any liability
The insertion of this clause is to make both the owner as well as the contractor equally liable for the due observance of the Act
It is needless to stress that the contains various provisions for the safety of the mines and the persons employed therein
In the case of a mine the working whereof is being carried on by a raising contractor he is primarily responsible to comply with the provisions of the Act
Though a contractor for the working of a mine or any part thereof is not an owner he shall be subject to the provisions of the Act in the like manner as if he were an owner  but not so AS to exempt the owner from any liability
It is now axiomatic that when a legal fiction is incorporated in a statute the Court has to ascertain for what purpose the fiction is created
After ascertaining the purpose full effect must be given to the statutory fiction and it should be carried to its logical conclusion
The Court has to assume all the facts and consequences which are incidental or inevitable corollaries to giving effect to the fiction
The legal effect of the words as if he were in the definition of owner in section 3n of the Nationalisation Act read with section 21 of the is that although the petitioners were not the owners they being the contractors for the working of the mine in question were to be treated as such though in fact they were not so
The oft quoted passage in the judgment of Lord Asquith in East End Dwelling Co Ltd Fine bury Borough Council brings out the legal effect of a legal fiction in these words If you are bidden to treat an imaginary state of affairs as real you must surely unless prohibited from doing so also imagine as real the consequence and incidents which if the putative state of affairs had in fact existed must inevitably have 388 flowed from or accompanied it
The statute says that you must imagine a certain state of affairs it does not say that having done so you must cause or permit your imagination to boggle when it comes to the inevitable corollaries of that state of affairs
 The whole object and purpose of the Nationalisation Act is to expropriate private ownership of coking coal mines and all interests created therein
It provides by sub section
1 of section 4 that on the appointed day the right title and interest of the owners in relation to the coking coal mines specified in the First Schedule shall stand transferred to and shall vest absolutely in the Central Government free from all incumbrances
Now unless the term owner  in sub section
1 of section 4 is given an extended meaning so as to include a contractor for the working of a mine or any part thereof the very object of the legislation would be frustrated
It has to be presumed that Parliament was fully aware of the normal pattern of working of all the coal mines ie by employment of raising contractors
Any other construction would lead to a manifest absurdity and attribute to Parliament a result which it never intended
It would result in the contractors escaping from the consequences of vesting under sub section
1 of section 4 of the Act and permit them to dismantle and remove the additional machinery plants and equipment which were being utilised for the working of mines
This brings us to the next question namely whether the amount of Rs 450000 receivable by the petitioners from the erstwhile Coal Board was an amount impressed with a trust being advanced for a specific purpose ie for the purpose of stowing and other safety operations and conservation of coal mines and could not be regarded as any money due to the coking coal mines within sub section
3 of section 22 of the Act and the Central Government therefore could not appropriate the amount of subsidy and utilize it under sub section
4 thereof for meeting the liabilities of the coking coal mines
The conclusion of the High Court upon this point is contained in the following passage The amount of subsidy due could not be current assets of the coking coal mine because it had to be utilised for a certain definite specified purpose
In the instant case cost of stowing and other safety operations had already been incurred and the subsidy was by way of reimbursement
The amount was already identified as belonging to the petitioner and is on the analogy or in the nature of trust money impressed with a specific purpose 389 In reaching that conclusion it relied upon the decisions in Barclays Bank Ltd vs Quistclose Investments Ltd and Coal Products Private Ltd vs ITO which are both distinguishable
They enunciate the principle that when property is entrusted for specific purpose it is clothed with a trust
It seems somewhat illogical that the equitable doctrine of resulting trust should be brought into play in the construction of the provisions of a legislation dealing with nationalisation like the 
In Barclays Bank Ltd vs Quistclose Investments Ltd the House of Lords dealt with a question as to rights of set off following the liquidation of a company
The principle was applied to a sum of money lent to a company later wound up for a specific purpose viz payment of dividend which was not implemented the money being still identifiable was held to be impressed with a trust and accordingly did not enure to the benefit of the general body of creditors but was recoverable by the lender
In Coal Products Private Ltd vs ITO there was an extension of this principle by a Single Judge of the Calcutta High Court to assistance which was payable to the assessee and was sought to be 1 attached by the Income tax Department by way of garnishee proceedings under section 2263i of the Income tax Act 1961
There was an application made for grant of assistance under r 49 of the Coal Mines Conservation and Safety Rules 1952
There were conditions attached to the grant under r 54
There was an affidavit filed before the Calcutta High Court showing that the grant was subject to the condition that it would be utilised for the purpose of stowing and other connected operations in the coal mine
The High Court quashed the garnishee notice on the ground that the Income tax Department was not entitled to any part of the money for the payment of income tax liabilities of the assessee as it could only be utilized for the purpose of stowing and other safety operations and conservation of coal mines
F Two questions arise both of which must be answered in favour of the Union of India
The first is whether the payment of Rs 450000 was advanced for a special purpose ie as assistance  under r 49 and not by way of reimbursement 
The second is whether in that event the money having been advanced for a special purpose and that being so clothed with a specific trust it could not be adjusted by the Central Government under sub section
4 of section 22 of the Nationalisation Act towards the liabilities of the coking coal mines
It is not difficult to establish precisely on what terms the money was advanced by the erstwhile Coal Board
On behalf of the petitioners it is not disputed that the bills for the subsidy were for the H 390 cost of stowing and connected safety operations and of hard mining operations which the petitioners had already prior to October 17 1971 at their own cost carried out
If that be so the inevitable conclusion is that the amount of subsidy in question was like any other amount due to the coking coal mine prior to the appointed day and therefore did not fall outside the purview of sub section
3 of section 22
The payment in question was not by way of assistance  receivable from the erstwhile Coal Board for carrying out of stowing and other safety operations and conservation of the coal mines
In the present case the petitioners on their own showing had already carried our sand stowing and hard mining operations and had admittedly applied for subsidy by way of reimbursement
The payment of Rs 450000 was therefore one to reimburse for the expenditure already undertaken
Indubitably the amount in dispute was payable by way of reimbursement 
The petitioners were therefore free to utilise the money in any manner they liked
In other words the grant was not impressed with any particular purpose or purposes
Even if the subsidy receivable from the erstwhile Coal Board was by way of assistance  the amount of Rs 450000 was recoverable by the Central Government in whom the coking coal mines have vested under sub section
1 of section 4 of the Nationalisation Act and not by the petitioners
It is however needless to stress that if the grant were by way of assistance  under r 49 of the Coal Mines Conservation and Safety Rules 1952 the grant being conditional the Central Government would in that event
be bound to comply with the requirements of r 54 and apply the same for the purposes for which it was granted viz for the purposes of showing or other safety operations and conservation of coal mines
For these reasons the judgment of the High Court partly allowing the claim of the petitioners with regard to the subsidy amount of Rs 450000 is set aside and the writ petition is dismissed Accordingly the appeal of the Union of India is allowed and that of the Industrial Supplies Pvt Ltd is dismissed with costs throughout
Civil Appeal No 81578 dismissed and Civil Appeal No 128478 SR allowed


Summary:
The appellants by virtue of two agreements with Ms Balihari Colliery Co Pvt Ltd and with New Dharamband Colliery Ltd became the managing contractor for a period of 20 years of the former and the raising contractor of the latter
In terms of the said agreements they installed from time to time various fixed assets like machinery plants and equipment and erected structures and raised new roads within the said collieries
These two collieries were taken over by the Central Government under its management with effect from October 17 1971 by virtue of the powers vested in it under the 
The appellants aggrieved by the said taking over filed a writ petition in the Delhi High Court seeking a declaration that subs
I of section 4 of the Nationalisation Act does not provide for the acquisition of the right title and interest inasmuch as being raising contractors they were not covered by the term owner  within the meaning of section 3n of the Nationalisation Act and therefore they were entitled to dismantle and remove the fixed assets like machinery plants etc
They also sought to recover the amount of subsidy of about Rs 450000 collected by the Central Government from the erstwhile Coal Board
The High Court substantially disallowed the claim of the appellants holding that they fall within the meaning of term owner 
It however held that the amount of subsidy of Rs 450000 receivable from the Coal Board by way of reimbursement towards the cost of sand stowing and hard mining operations carried on by them could not be treated to be as an amount due to the coking coal mine within the meaning of sub section
3 of section 22 and therefore could not be utilised by the Central Government under sub section
4 of section 22 for discharge of the liabilities of the coking coal mine
Hence the two appeals one by the appellants and the other by the Union of India
Allowing the Union of India s appeal only and dismissing the Company s appeal the Court 376  HELD I The appellants do fall under the purview of the term owner in section 3n of the Nationalisation Act read with section 2 of the and any other construction as sought to be placed on the definition would frustrate the very object of the legislation and the intention of the Legislature387 F Parliament with due deliberation
in section 3n adopted by incorporation the enlarged definition of the owner in section 21 of the to make the Nationalisation Act all embracing and fully effective
The definition is wide enough to include three categories of persons i in relation to a mine
the person who is the immediate proprietor or a lessee or occupier of mine or any part thereof ii in the case of a mine the business whereof is carried on by a liquidator or a receiver such liquidator or receiver and iii in the case of a mine owned by a company the business whereof is carried on by a managing agent such managing agent
Each is a separate and distinct category of persons and the concept of ownership docs not come in
The insertion of the clause but any contractor for the working of a mine or any part thereof shall be subject to this Act in like manner as if he were an owner but not so as to exempt the owner from any liability is to make both the owner as well as the contractor equally liable for the due observance of the Act Tn the case of a mine the working whereof is being carried on by a raising contractor he is primarily responsible to comply with the provisions of the 
Though a contractor for the working of a mine or any part thereof is not an owner he shall be subject to the provisions of the in the like manner as if he were a owner but not so as to exempt the owner from any liability
387 A D The whole object and purpose of the Nationalisation Act is to expropriate private ownership of coking coal mines and all interests created therein
The term owner  in sub section
l of section 4 is to be given an extended meaning so as to include a contractor for the working of a mine or any part thereof
It has to be presumed that Parliament was fully aware of the normal pattern of working of all the coal mines that is by employment of raising contractors
Any other consumption would lead to a manifest absurdity and attribute to Parliament a result which it never intended
It would result in the contractors escaping from the consequences of vesting under sub section
I of section 4 of the Act and permit them to dismantle and remove the additional machinery plants and equipment which are being utilised for the working of mines
388 B D 2 The word occupier  in 5 3n of the Nationalisation Act should be understood to have been used in the usual sense according to its plain meaning
In the legal sense an occupier is a person in actual occupation
The appellants being raising contractors were under the terms of the agreement dated February 7 1969 entitled to and were in fact in actual possession and enjoyment of the colliery and were therefore an occupier thereof
That being so the appellants in possession in their own right by virtue of their substantial right acquired by them under the agreement were not in possession on behalf of somebody else
384F G The Chief Inspector of Mines and Anr
vs Lala Katarnchand Thaper etc
  distinguished
3 The Nationalisation Act no doubt separately defines owner  and managing contractor 
The words and expressions used and defined in the Act have the meaning respectively assigned to them unless the context otherwise requires
Therefore the expression managing contractor  as defined in section 31 of the Nationalisation Act comes into play only for the purpose of apportionment 377 of compensation under sub section
2 of section 26
To exclude a managing contractor from term owner  used in sub section
I of section 4 of the Nationalisation Act would be against the scheme of the Act
The term owner  in sub section
I of section 4 of the Act must bear the meaning given in the definition contained in section 3n
Any reservation under any process of any agreement between the parties to reserve the power to appoint managers does not take the appellants out of the definition of managing contractor  under section 31 of the Nationalisation Act since they still had substantial control over the mine
The plea that not they but someone else was the managing contractor is only an after thought
The appellants who have bound themselves by the terms of the agreement cannot be permitted to escape from the provisions of sub section
I of section 4 of the Act as they come within the purview of the definition of owner  in section 3n of the Nationalisation Act
384 H 385 C 385 H 386 A 386 E F 4 When a legal fiction is incorporated in a statute the Court has to ascertain for what purpose the fiction is created
After ascertaining the purpose full effect must be given to the statutory fiction and it should be carried to its logical conclusion
The court has to assume all the facts and consequences which are incidental or inevitable corollaries to giving effect to the fiction
The legal effect of the words as if he were in the definition of owner in section 3n of the Nationalisation Act read with section 21 of the is that although the petitioners were not the owners they being the contractors for the working of the mines in question were to be treated as such though in fact they were not so
388 E G East End Dwelling Co Ltd vs Finebury Borough Council LR 1952AC 109 p 132 quoted with approval
5 The bills for the subsidy were for the cost of stowing and connected safety operation and all hard mining operations which the appellants had already prior to October 17 1971 at their own cost carried out
If that be so the amount of subsidy in question was like any other amount due to the coking coal mines prior to the appointed day and therefore did not fall outside the purview of sub section
3 of section 22
389 H 390 A The payment in question was not by way of assistance receivable from the erstwhile Coal Board for carrying out the stowing and other safety operations and conservation of the coal mines
The payment of Rs 450000 claimed by the appellants was therefore one to reimburse for the expenditure already undertaken
Indubitably the amount in dispute was payable by way of reimbursement
The appellants were therefore free to utilise their money in any manner they liked
In other words the grant was not impressed with any particular purpose or purposes
390 B C 6 Even if the subsidy receivable from the erstwhile Coal Board was by way of assistance  the amount of Rs 450000 was recoverable by the Central 6 Government in whom the coking coal mines have vested under sub section
1 of section 4 of the Nationalisation Act and not by tho appellants
If the grant were by way of assistance under rule 49 of the Coal Mines Conservation and Safety Rules 1952 the grant being conditional the Central Government would in that event be bound to comply with the requirements of r 54 and apply the same for the purposes for which it was granted namely for the purposes of stowing or other safety operations and conservation of coal mines
390 D E H Barclays Bank Ltd vs Quistclose Investments Ltd LR 1970 AC 567 Coal Products Private Ltd vs Income Tax Officer explained and distinguished