PRABHAKAR GANPATRAO SAMEL Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) THESE three petitions are filed by rice millers and raise important questions regarding the validity of the Maharashtra Scheduled Foodgrains (Stocks Declaration and Procurement and Disposal, Acquisition, Transport and Price Control) Order, 1966 (hereinafter referred to as the Order of 1966) and the action taken by the State Government thereunder. This Order was promulgated under the Essential Commodities Act, 1955, as amended from time to time. Shortly stated, by this Order the Government prohibited all private dealings in certain kinds of foodgrains and made it compulsory to be sold to the Government or its agent. The said Order contains 20 clauses and, as now finalised, it applies to paddy and rice, Jowar, Nagli, Pohas and Kurmuras. Clause 3 of the said Order requires periodical declarations of stocks by every person who holds more than ten quintals of the scheduled foodgrains. Clause 4 gives power to the Collector or any officer authorised by him to call for declaration of stocks. Clause 5 prevents any person or class of persons, if so directed by the Collector or any officer authorised by him, to consume, remove or sell or dispose of in any manner whatsoever such stocks of food -grains. Clause 6 gives power to the Collector to call upon any person holding stocks of foodgrains beyond his normal requirements to be sold to the Government or its officer or agent named by the Collector at a price stated by him etc. Clause 7 is a consequential clause and provides for action to be taken in case 'of failure to comply with any direction under Clause 6. Clause 8 prescribes the procedure for giving notice under clauses 4, 5 and 6. Clause 9 prevents anyone except under and in accordance with an authorisation granted by the Collector or by an Officer authorised by the Collector from acquiring any foodgrains from any person for the purpose of sale or storage for sale. Clause 9A has been added subsequently by an amendment on November 25, 1967 and imposes restrictions on the milling of paddy or rice except under and in accordance with an authorisation granted by the Collector and also prevents purchase or acquisition of paddy or rice from any person for the purpose of milling for household consumption. It also gives power to the Collector or the authorised officer to impose limitations on the quantities that could be milled in respect of any person or class of persona and also on the charges for the same. Clause 10 prevents any person other than recognised dealers from selling or otherwise disposing of foodgrains to any person except under and in accordance with an authorisation granted by the Collector or any Officer authorised by him. It contains two exceptions: (1) in respect of sale or disposal in favour of the Government or any officer or agent nominated by the State Government or the Collector and (2) in respect of sale or disposal by an agriculturist to any other person for bona fide consumption by that person in a certain manner and to the classes of persons mentioned therein. Clause 11 enables the Collector to call upon any person having stocks of foodgrains in excess of his family requirements as stated therein, and who has acquired it under Clause 10 to sell it to the Government and deliver the same at the purchase centre that portion of his stocks which is over and above the maximum limit prescribed therein. Clause 12 prevents all persons other than recognised dealers from transporting food -grains without authorisation. Certain exceptions are provided therein consequential upon the other provisions of this Order. Clause 14 prescribes the price payable by the Government or its agent to any person who is required to sell the specified foodgrains as specified in the schedule. Clause 15 requires the Collector or the Appropriate Officer to serve notice of demand on every holder of land to sell surplus stock over and above his requirements prescribed in that clause to the Government at the price stated in Clause 14. Clause 16 gives powers of entry, search, seizure etc. to the Collector or any officer authorised by the State Government or the Collector, or any appropriate Officer or any Police Officer not below the rank of Sub -Inspector for inspecting' any stocks of foodgrains in respect of which he has reason to believe that this Order has been contravened with other consequential provisions. Clause 17 provides an exception to the effect that the Order would not apply to the stocks held by the Government and transported by certain agencies. Clause 18 gives power to the State Government subject to such conditions as may be specified in this behalf by general or special order, to exempt any person or class of persons or the public, generally in any area or throughout the State in respect of all or any of the foodgrains from the provisions of the Act and also gives it power to suspend or cancel any such exemption. Clause 19 gives a person aggrieved by an order made under the said Order the right of appeal.

(2.) GOVERNMENT appointed a working group to suggest improvement in the monopoly procurement in August 1967. After its suggestions were received, by a Resolution dated December 10, 1967, it formulated its policy under the Order of 1966. It appointed the Maharashtra State Co -operative Marketing Federation Ltd. (we will refer to it as the Federation) as its agent. It had to take delivery of all foodgrains on behalf of the State, have them milled and deliver the same thereafter to the Collectors of the Districts. For doing this it had to act in accordance with the instructions contained in the Resolution. These instructions go in minute details. The Resolution also lays down detailed instructions for the guidance of the Collectors in carrying - out the provisions of the Order of 1966.

(3.) THE first contention can be shortly disposed of as it depends upon the construction of the provisions of the Act of 1955. The preamble of the said Act is: An Act to provide, in the interest of the general public, for the control of the production, supply and distribution of, and trade and commerce in, certain commodities. Be it enacted... Section 3 of the Act lays down the powers in general terms as follows: Powers to control production, supply, distribution, etc. of essential commodities: - (1) If the Central Government is of opinion that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices, it may, by order, provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein, (2) Without prejudice to the generality of the powers conferred by Sub -section (1), an order made thereunder may provide....(f) for requiring any person holding in stock any essential commodity to sell the whole or a specified part of the stock to the Central Government or State Government or to an officer or agent of such Government or to such other person or class of persons and in such circumstances as may be specified in the order ; It is argued by Mr. Porus Mehta that the terms of Section 3(7) of the Act of 1955, which are general, do not indicate that any power is intended to be vested in the Central Government to have a monopoly of trading in any of the food -grains or articles referred to in the Act. It is no doubt true that there is no express power. Sub -section (2) refers to the provisions of Sub -section (1) and to its generality and makes provision for orders regarding the several matters. Inasmuch as by Clause (f) a provision is made for an order for requiring any person to sell the stock of any essential commodity to the Government or an officer or agent of such Government, it must indicate that this power is included in Sub -section (1) even without its being specifically referred to. In any event, on the construction of Clause (i) it is obvious that it is within the power of the Government to frame or make any order requiring any person to sell the stock in any essential commodity to the Government or its agent or an officer or even to such other person or class of persons. Sub -section (1) enables the State Government to prohibit trade in essential commodities by special or general order. It is not, therefore, possible to accept the contention that the order in so far as it requires every person to sell the surplus stock to the Government is not within the intendment of Section 3 of the Act of 1955.