1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE SIDE WRIT PETITION NO.5186 OF 2001 Shri Vijay C. Puljal. ...Petitioner. Versus State of Maharashtra & Ors. ...Respondents. ....... Mr. Vinod Bobde, Senior Advocate with Mr.Vineet B. Naik and Mr. Arjun Bobde for the Petitioner. Mr. E. P. Bharucha, Special Counsel with Mr. Bhomi Patel, AGP and Mr.N. P. Deshpande, AGP for Respondent No.1. ...... WITH WRIT PETITION NO.517 OF 2004 Pulluru Bhaskara Rao & Ors. ...Petitioners. Vs. State of Maharashtra & Ors. ...Respondents. .... WITH WRIT PETITION NO.7480 OF 2003 Nurpender Rao & Ors. ...Petitioners. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr. Vinod Bobde, Sr.Advocate with Mr.Vineet Naik and Mr. Arjun Bobde for the Petitioners. Mr. E. P. Bharucha, Special Counsel with Mr. Bhomi Patel, AGP and Mr. N. P. Deshpande, AGP for Respondent No.1. ..... 2 WITH WRIT PETITION NO.3661 OF 2001 WITH CIVIL APPLICATION NOS.2017/03, 1104 & 1105/04, C.A. ST. NO. 19061/04 AND C.A.NO.1063/05 M/s.Kuber Mutual Benefit Ltd. & Ors. ...Petitioners. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr.Y. R. Singh for the Petitioners. Mr. E. P. Bharucha, Special Counsel with Mr. Bhomi Patel, AGP and Mr. N. P. Deshpande, AGP for Respondent No.1. Mr. Kirit J. Hakari for the Applicant in CA 2017/03. ..... WITH CRIMINAL APPELLATE JURISDICTION WRIT PETITION NO.2175 OF 1999 M/s.Indian Seamless Financial Services Ltd.& Ors. ...Petitioners. Vs. Abhinay C. Deshmukh & Anr. ...Respondents. ..... Ms. Parul Bhatia i/b.Mulla & Mulla for the Petitioners. Mr.Naveen Chomal for Respondent No.1. Ms.Kantharia, APP for Respondent No.2. ..... WITH WRIT PETITION NO.685 OF 2000 Heritage India Club Ltd. & Anr. ...Petitioners. Vs. State of Maharashtra & Ors. ...Respondents. ..... Ms.Kantharia, APP for Respondent No.1 and 2. Mr.R. D. Soni and Mr. J.K. Hegde for Respondent No.3. ..... WITH WRIT PETITION NO.903 OF 2000 3 Uday Manohar Acharya. ...Petitioner. Vs. State of Maharashtra & Anr. ...Respondents. ..... Mr.Nitin Pradhan, with Ms.S. D. Khot i/b. M/s.Law Global for the Petitioners. Ms.P. H. Kantharia, APP for Respondent Nos.1 and 2. ..... WITH WRIT PETITION NO.716 OF 2001 S.M.Khanna & Ors. ...Petitioners. Vs. Alda Coelho & Ors. ...Respondents. ..... Mr.Nitin Pradhan with Racheeta R. Dhuru for the Petitioners. Mr. S.K. Jain for Respondent No.1. Ms. P.H. Kantharia, APP for Respondent No.11. ..... WITH WRIT PETITION NO.1569 OF 2001 Subhash Sadashiv Karkhanis & Ors. ...Petitioners. Vs. The Senior Inspector of Police & Ors. ...Respondents. ..... Mr.M. S.Mohite for the Petitioners. Mr. S. R. Borulkar, APP. for Respondent No.1. ..... WITH WRIT PETITION NO.150 OF 2002 WITH APPLICATION NOS.4034/05, 4481/02 & 4634/03 Nilesh Lalit Parekh. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... 4 Mr. Virendra Tulzapurkar with Mr. P. K. Samdani i/b. M/s.Prakash & Co. for the Petitioners. Mr. S. R. Borulkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.234 OF 2002 AND WRIT PETITION NOS.1669 & 1782 OF 2002 Pratap V. Padode. Sanjay Padode Rajesh Padode. ...Petitioners. Vs. Shripad C. Thakur & Ors. ...Respondents. ..... None for the Petitioners. Mr. S. R. Borulkar, APP for the State. Mr. S.P. Kadam for Respondent Nos.1 and 2. ..... WITH WRIT PETITION NO.890 OF 2002 Vinayak Gopinath Vengurlekar. ...Petitioner. Vs. Sunil More & Anr. ...Respondents. ..... Mr. M. S. Mohite with Mr. G.P. Rajan for the Petitioner. Mr. D. M. Shah & Mr. P.G. Karande for Respondent No.1. Mr.S. R. Borulkar, APP for Respondent No.2. ..... WITH WRIT PETITION NO.1382 OF 2002 Purshottam Radheshyam Khandelwal. ...Petitioner. Vs. Union of India & Ors. ...Respondents. ..... Mr.A. M. Saraogi for the Petitioner. Mr.S. R. Borulkar, APP for Respondent No.2. 5 Smt.Aarti P. Bhide for Respondent No.3. ..... WITH WRIT PETITION NO.1582 OF 2002 Mohammed Hussain Mohammed Ismail Khatkhatay & Ors. ...Petitioners. Vs. Union of India & Ors. ...Respondents. ..... Mr.A. M. Saraogi for the Petitioners. Mr. D. S. Mehta, APP for Respondent No.1. ..... WITH APPLICATION NOS.4714 & 644 OF 2003 IN APPEAL NO.195 OF 2003 WITH APPEAL NO.195 & 198 OF 2003 Hariram Mohandas wadhwa & Ors. ...Petitioners. Vs. M/s.Indic Farms & Ors. ...Respondents. ..... Mr.A. N. Makhijani for the Petitioners. Mr. D. S. Mhaispurkar., APP for the State. ..... WITH WRIT PETITION NO.441 OF 2003 Deepak R. Wagle & Anr. ...Petitioners. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr.S. K. Jain for the Petitioners. Mr.D. S. Mhaispurkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.669 OF 2003 6 Sanjay Chandrakant Kirloskar & Ors. ...Petitioners. Vs. Vivekanand Vithal Awale & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms. S. D. Khot for the Petitioners. Mr. D. S. Mhaispurkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.871 OF 2003 Dr. V. Parameshvara. ...Petitioner. Vs. Kirloskar Investment & Finance Ltd. & Ors....Respondents. ..... Mr. Nitin Pradhan with Ms. S. D. Khot for the Petitioner. Mr.D. S. Mhaispurkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.872 OF 2003 Dr. K. S. Lrosjmaswami. ...Petitioner. Vs. Kirloskar Investment & Finance Ltd. & Ors....Respondents. ..... Mr. Nitin Pradhan with Ms. S. D. Khot for the Petitioner. Mr. D. S.Mhaispurkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.1019 OF 2003 Rajinder Singh Dhanjal. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr.A. M. Saraogi for the Petitioner. Mr. A. S. Gadkari, APP for Respondent No.1. ..... WITH 7 WRIT PETITION NO.1069 OF 2003 WITH APPLICATION NOS.5043 & 5077 OF 2005 Central Bank of India. ...Petitioner. Vs. The Senior Inspector of Police & Ors. ...Respondents. ..... Mr.Sanjog Parab i/b. M/s. Mulla & Mulla for the Petitioner. Mr. A. S. Gadkari, APP for Respondent No.1. ..... WITH WRIT PETITION NO.1114 OF 2003 Deepak Krishnakant Purohit & Anr. ...Petitioners. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr.Shirish Gupte with M. N. Vaishnav i/b. N.N. Vaishnava & Co. for the Petitioners. Mr.A. S. Gadkari, APP for Respondent No.1. ..... WITH WRIT PETITION NO.1221 OF 2003 Dhanraj Betala & Anr. ...Petitioners. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr.Sameer vaidya for the Petitioners. Mr. K. V. Saste, APP for Respondent No.1. ..... WITH WRIT PETITION NO.1245 OF 2003 Subhash Sadashiv Karkhanis. ...Petitioner. Vs. Union of India & Ors. ...Respondents. ..... 8 Mr.A. V. Chatuphale for the Petitioner. Mr. K. V. Saste, APP for the State. ..... WITH WRIT PETITION NO.1504 OF 2003 Morepen Laboratories Ltd. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr. Mudij Sharma with Mr. Yashpal Thakkar i/b. Mr.Paras Kuhad for the Petitioners. Mr. K. V. Saste, APP for Respondent No.1. ..... WITH WRIT PETITION Nos.108 & 109 OF 2004 Rajendrasingh. ...Petitioner. Vs. Union of India & Ors. ...Respondents. ..... Mr.A. M. Saraogi for the Petitioner. Mr. K. V. Saste, APP for Respondent No.2. ..... WITH WRIT PETITION NO.294 OF 2004 Dinesh Harilal Verma. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... None for the Petitioners. Mr. S. S. Tatkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.382 OF 2004 M/s.Popular Stock & Share Services Ltd. & Ors. ...Petitioners. Vs. 9 State of Maharashtra & Ors. ...Respondents. ..... Mr. Samir A. Vaidya with Mr.L. R. Castelino for the Petitioners. Mr. S. S. Tatkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.1408 OF 2004 M. V. Patwardhan. ...Petitioner. Vs. Vishnjukant Bapurao Urankar & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Mr.Prakash Naik for the Petitioner. Mr.S. S. Tatkar, APP for the State. ..... WITH WRIT PETITION NO.1409 OF 2004 M. V. Patwardhan. ...Petitioner. Vs. Usha Prabhakar Vaishampayan & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b.Mr.Prakash Naik for the Petitioner. Mr. P. S. Hingorani, APP for Respondent No.3 to 5 ..... WITH WRIT PETITION NO.1410 OF 2004 M. V. Patwardhan. ...Petitioner. Vs. Narhar Madhav Panditrao & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Mr.Prakash Naik for the Petitioner. Mr. B. V. Ghanekhar for Respondent No.1. Mr. P. S. Hingorani, APP for Respondent No.3 to 5. ..... 10 WITH WRIT PETITION NO.1411 OF 2004 M. V. Patwardhan. ...Petitioner. Vs. Jayant Govind Jadhav & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Mr.Prakash Naik for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mr.P. S. Hingorani, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1412 OF 2004 M. V. Patwardhan. ...Petitioner. Vs. Anil Sakharam Dandekar & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Mr.Prakash Naik for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mr. P. S. Hingorani, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1413 OF 2004 M. V. Patwardhan. ...Petitioner. Vs. Vinayak Krishna Kulkarni & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Mr.Prakash Naik for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mrs. S. D. Shinde, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1414 OF 2004 11 M. V. Patwardhan. ...Petitioner. Vs. Babji Ramchandra Deshpande & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Mr.Prakash Naik for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mrs. S. D. Shinde, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1415 OF 2004 M. V. Patwardhan. ...Petitioner. Vs. Shashikant Madhav Panditrao & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Mr.Prakash Naik for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mrs. S. D. Shinde, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1417 OF 2004 Maheen Sanjay Chandrakant Kirloskar. ...Petitioner. Vs. Vishnukant Bapurao Urankar & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Mr.Prakash Naik for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mrs. S. D. Shinde, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1419 OF 2004 12 Maheen Sanjay Chandrakant Kirloskar. ...Petitioner. Vs. Usha Prabhakar Vaishampayan & Ors. ...Respondents. ..... Mr.Nitin Pradhan with Ms.S. D. Khot for the Petitioner. Mr. A. R. Patil, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1420 OF 2004 Maheen Sanjay Chandrakant Kirloskar. ...Petitioner. Vs. Narhar Madhav Panditrao & Ors. ...Respondents. ..... Mr.Nitin Pradhan with Ms.S. D. Khot for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mr.A. R. Patil, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1421 OF 2004 Maheen Sanjay Chandrakant Kirloskar. ...Petitioner. Vs. Jaywant Govind Jadhav & Ors. ...Respondents. ..... Mr.Nitin Pradhan with Ms.S. D. Khot for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mr.A. R. Patil, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1422 OF 2004 Maheen Sanjay Chandrakant Kirloskar. ...Petitioner. Vs. Anil Sakharam Dandekar & Ors. ...Respondents. ..... Mr.Nitin Pradhan with Ms.S. D. Khot for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mr. A. R. Patil, APP for Respondent No.3 to 5. 13 ..... WITH WRIT PETITION NO.1423 OF 2004 Maheen Sanjay Chandrakant Kirloskar. ...Petitioner. Vs. Vinayak Krishna Kulkarni & Ors. ...Respondents. ..... Mr.Nitin Pradhan with Ms.S. D. Khot for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mrs.Usha Kejariwal, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1424 OF 2004 Maheen Sanjay Chandrakant Kirloskar. ...Petitioner. Vs. Babji Ramchandra Deshpande & Ors. ...Respondents. ..... Mr.Nitin Pradhan with Ms.S. D. Khot for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mrs.Usha Kejariwal, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1425 OF 2004 Maheen Sanjay Chandrakant Kirloskar. ...Petitioner. Vs. Shashikant Madhav Panditrao & Ors. ...Respondents. ..... Mr.Nitin Pradhan with Ms.S. D. Khot for the Petitioner. Mr. B.V.Ghanekar for Respondent No.1. Mrs.Usha Kejariwal, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1427 OF 2004 Prabhakar Dattatraya Gune. ...Petitioner. Vs. 14 Vishnukant Bapurao Urankar & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Ms.Manisha B. Patil for the Petitioner. Mrs. Usha Kejariwal, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1428 OF 2004 Prabhakar Dattatraya Gune. ...Petitioner. Vs. Usha Prabhakar Vaishampayan & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Ms.Manisha B. Patil for the Petitioner. Mrs. Usha Kejariwal, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1429 OF 2004 Prabhakar Dattatraya Gune. ...Petitioner. Vs. Narhar Madhav Panditrao & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Ms.Manisha B. Patil for the Petitioner. Mr. B. V. Ghanekar for Respondent No.1. Mr.B. H. Mehta, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1430 OF 2004 Prabhakar Dattatraya Gune. ...Petitioner. Vs. Jaywant Govind Jadhav & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Ms.Manisha B. Patil for the Petitioner. Mr. B. V. Ghanekar for Respondent No.1. 15 Mr.B. H. Mehta, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1431 OF 2004 Prabhakar Dattatraya Gune. ...Petitioner. Vs. Anil Sakharam Dandekar & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Ms.Manisha B. Patil for the Petitioner. Mr. B. V. Ghanekar for Respondent No.1. Mr.B. H. Mehta, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1432 OF 2004 Prabhakar Dattatraya Gune. ...Petitioner. Vs. Vinayak Krishna Kulkarni & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Ms.Manisha B. Patil for the Petitioner. Mr. B. V. Ghanekar for Respondent No.1. Mrs.V. R. Bhansali, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION NO.1433 OF 2004 Prabhakar Dattatraya Gune. ...Petitioner. Vs. Babji Ramchandra Deshpande & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Ms.Manisha B. Patil for the Petitioner. Mr. B. V. Ghanekar for Respondent No.1. Mrs.V. R. Bhansali, APP for Respondent No.3 to 5. ..... WITH 16 WRIT PETITION NO.1434 OF 2004 Prabhakar Dattatraya Gune. ...Petitioner. Vs. Shashikant Madhav Panditrao & Ors. ...Respondents. ..... Mr. Nitin Pradhan with Ms.S. D. Khot i/b. Ms.Manisha B. Patil for the Petitioner. Mr. B. V. Ghanekar for Respondent No.1. Mrs.V. R. Bhansali, APP for Respondent No.3 to 5. ..... WITH WRIT PETITION Nos.1863, 1864 & 1865 OF 2004 Purshottam Radheshyam Khandelwal. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr. A. M. Saraogi for the Petitioner. Mrs. K. R. Bhansali, APP for Respondent No.1 (in W.P. 1863/04). Mr. R. S. Khadapkar, APP for Respondent No.1 in W. P. 1864 & 1865 of 2004). Mr. S. P. Kanuga for Respondent No.2. ..... WITH WRIT PETITION NO.2225 OF 2004 Suresh G. Motwani. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr. S. G. Aney, Sr. Advocate i/b. Mr. K. J. Reddy for the Petitioner. Mr.R. S. Khadapkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.2271 OF 2004 WITH APPLICATION NO.2794 OF 2005 17 Kiran Vithal Vaidya. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mrs. Revati Mohite Dere for the Petitioner. Mr. R. S. Khadapkar, APP for Respondent No.1. ..... WITH WRIT PETITION NO.2308 OF 2004 Narayandas @ Narubhai Laxmidas Thakkar. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr. J. J. Shah for the Petitioner. Mr. A. M. Shringarpure, APP for Respondent No.1. ..... WITH WRIT PETITION NO.2592 OF 2004 Shiv Ratan Kumar Pandey. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr. Nitin Pradhan, with Ms. S. D. Khot for the Petitioner. Mr. A. M. Shringarpure, APP for Respondent No.1. ..... WITH WRIT PETITION NO.2623 OF 2004 Vijay Singh B. Padode. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... None for the Petitioner. Mr.A. M. Shringarpure, APP for Respondent No.1. ..... WITH WRIT PETITION NO.184 OF 2005 18 Shantaraj Yellappa Shetty. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr. A. H. H. Ponda for the Petitioner. Mr. A. M. Shringarpure, APP for Respondent No.1. ..... WITH WRIT PETITION NO.1011 OF 2005 Vijaysingh Balchand Padode & Ors. ...Petitioners. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mrs. Kamal Jain for the Petitioner. Mr. R. M.Sadhavi, APP for Respondent No.1. ..... WITH WRIT PETITION NO.1159 OF 2004 Al-Ameen Islamic Financial and Investment corporation. ...Petitioner. Vs. State of Maharashtra & Ors. ...Respondents. ..... Mr. S. S. Sayyed for the Petitioner. Mr. R. M. Sadhavi, APP for Respondent No.1. ..... WITH O. O. C. J. WRIT PETITION NO.1900 OF 2002 Dr.Ramnarain S. Tarneja & Anr. ...Petitioners. Vs. State of Maharashtra. ...Respondent. ..... Mr. S. G. Aney with Mr.H. Toor with Mr. F. Pooniwala, Mr. Z. A. Haq, Mr. Firoz Palkhiwala, Mr. Firdosh Pooniwala, Mr. S.A. Ahemd, and Mr. S.S. 19 Bhole i/b. Cr. Bayley & Co. for the Petitioner. Mr. E. P. Bharucha, Sr.Advocate with Mr. N.P. Deshpande, AGP for the Respondent. ..... CORAM : A. P. SHAH D.K. DESHMUKH AND DR. D.Y. CHANDRACHUD, JJ. September 5, 2005. PJUDGMENT (PER DR. D. Y. CHANDRACHUD, J): I The constitutional validity of the Maharashtra Protection of Interests of Depositors (In Financial Establishments) Act, 1999, forms the basis of challenge in this batch of petitions under Article 226 of the Constitution. These petitions have been placed before the Full Bench by the Learned Chief Justice, in pursuance of a reference made on 3rd September 2004 by a Division Bench. Though the Act has been challenged on several grounds, arguments before the Court have been confined to the legislative competence of the State Legislature to enact the law. Counsel appearing on behalf of the Petitioners and the State had fairly stated before the Court that it would become necessary for the Court to deal with the other challenges only in the event that this Court does not accept the principal challenge on the 20 ground of a want of legislative competence. We have come to the conclusion that the provisions of the Act are ultra vires for want of legislative competence in the State Legislature. II FACTS 2. The Petitioner in Writ Petition 5186 of 2001, was a whole time Director of Pennar Paterson Securities Limited, a company incorporated under the Companies Act, 1956 with a registered office at Hyderabad. The Company was a non-banking finance company and is stated to have advanced money to several Companies. The Company is stated to have sustained huge losses and on 24th November 1999, the High Court of Andhra Pradesh noted in the course of its order in a Company Petition that the Company had outstanding debts of Rs. 13.07 crores on 30th September 1999. A Provisional Liquidator was appointed by the High Court. The Liquidator was directed to recover the amounts due to the Company and to not distribute any portion of the recoveries to the creditors. Among the Consequential directions was a direction to the Official 21 Liquidator to associate three persons from amongst the secured creditors as part of a Committee that would submit a report to the Court on the viability of the Company. The Official Liquidator is stated to have submitted a report to the Andhra Pradesh High Court recording that an amount of Rs.17 crores could be recovered by the Company; that certain decrees have been obtained for the recovery of the outstanding dues which would have to be executed. The Company is stated to have received notices from depositors at Mumbai, Pune, Aurangabad and Nagpur seeking the repayment of their deposits on maturity and it has been stated that notices have been received threatening prosecution against the Company and its Directors under the provisions of the State Act. A declaration has been sought in these proceedings that the Act is ultra vires on the ground that the State Legislature did not possess legislative competence. We have adverted to the facts of the main petition before the Court with a view to enunciate in brief, a flavour of the underlying facts in this batch of cases. The common thread, as it were, is a default in the repayment of depositors in diverse parts of the State. 22 III The Maharashtra Act. 3. The Act was reserved for and received the assent of the President of India on 21st January 2000. The Act was preceded by Ordinances promulgated on 29th April 1999 and on 2nd December 1999 and is deemed to have come into force on 29th April 1999 by virtue of the provisions of Section 1(2). The Statement of Objects and Reasons sets out the underlying basis of the enactment in the following terms: “There is mushroom growth of Financial Establishments in the State of Maharashtra in the recent past. The sole object of these Establishments is of grabbing money received as deposits from public, mostly middle class and poor on the promises of unprecedented highly attractive rates of interest or rewards and without any obligation to refund the deposit to the investors on maturity or without any provision for ensuring rendering of the services in kind in return, as assured. Many of these Financial Establishments have defaulted to return the deposits on maturity or to pay interest or render the services in kind, in return, as assured to the public. As such deposits run into crores of rupees. It has resulted in great public resentment and uproar, creating law and order problem in the State of Maharashtra, specially in the city like Mumbai which is treated as the financial capital of India. It is, therefore, 23 expedient to make a suitable special legislation in the public interest to curb the unscrupulous activities of such Financial Establishments in the State of Maharashtra.” Section 2(c) of the Act defines the expression “deposit” in the following terms: “(c) “deposit” includes and shall be deemed always to have included any receipt of money or acceptance of any valuable commodity by any Financial Establishment to be returned after a specified period or otherwise, either in cash or in kind or in the form of a specified service with or without any benefit in the form of interest, bonus, profit or in any other form, but does not include- -(i) amount raised by way of share capital or by way of debenture, bond or any other instrument covered under the guidelines given, and regulations made, by the SEBI, established under the Securities and Exchange Board of India Act, 1992 (15 of 1992); -(ii) amounts contributed as capital by partners of a firm; -(iii) amounts received from a scheduled bank or a co- operative bank or any other banking company as defined in clause (c ) of Section 5 of the Banking Regulation Act, 1949 (10 of 1949); -(iv) any amount received from, - (a) the Industrial Development Bank of India, (b) a State Financial Corporation, (c ) any financial institution specified in or under Section 6- 24 A of the Industrial Development Bank of India Act, 1964 (18 of 1964), or (d) any other institution that may be specified by the Government in this behalf; -(v) amounts received in the ordinary course of business by way of, - (a) security deposit, (b) dealership deposit, (c ) earnest money, (d) advance against order for goods or services; -(vi) any amount received from an individual or a firm or an association of individuals not being a body corporate, registered under any enactment relating to money lending which is for the time being in force in the State; and -(vii) any amount received by way of subscriptions in respect of a Chit.” The expression “Financial Establishment” is similarly defined in Section 2(d) as follows : “(d) “Financial Establishment” means any person accepting deposit under any scheme or arrangement or in any other manner but does not include a corporation or a co-operative society owned or controlled by any State Government or the Central Government or a banking company as defined under clause (c ) of Section 5 of the Banking Regulation Act, 1949 (10 of 1949)”. 25 Section 3 of the Act creates an offence in respect of a fraudulent default in the repayment of a deposit on maturity and provides for imprisonment upto six years and fine. Section 3 is as follows : “3. Fraudulent default by Financial Establishment. -- Any Financial Establishment, which fraudulently defaults any repayment of deposit on maturity along with any benefit in the form of interest, bonus, profit or in any other form as promised or fraudulently fails to render service as assured against the deposit, every person including the promoter partner, director, manager or any other person or an employee responsible for the management of or conducting of the business or affairs of such Financial Establishment shall, on conviction, be punished with imprisonment for a term which may extend to six years and with