SATOBIDANANDA MUKHERJEE Vs. STATE OF WEST BENGAL
LAWS(CAL)-1960-2-24
HIGH COURT OF CALCUTTA
Decided on February 23,1960

SATOBIDANANDA MUKHERJEE Appellant
VERSUS
STATE OF WEST BENGAL Respondents

JUDGEMENT

- (1.) IN this application there are sixty petitioners. They all carry on business as retail dealers in soft coke in the Subdivision of Barrackpore in the District of 24-Parganas. The petitioners were granted licenses in form "b" under the West Bengal Soft Coke Distribution Order, 1947 now replaced by the West Bengal Soft Coke Distribution Order, 1955 (hereinafter referred to as the 'order' ). Until 18th May, 1959 the Sub divisional Controller, Food and Supplies, Barrackpore, passed an order to the effect that the petitioners and all retail dealers in soft coke possessing licenses in form "b" should no longer import soft coke direct from the collieries by road, but that they shall draw their supplies from a number of wholesale dealers who have been appointed for that purpose. According to the petitioners, this has prejudiced them, inasmuch as their profits have been cut down, resulting in total stoppage of their business. They have accordingly made this application for the issue of a writ in the nature of mandamus or prohibition restraining the respondents from enforcing the said order. On behalf of the respondents it was pointed out that the petitioners are retail dealers, to whom licenses in form "b" have been issued, valid upto Slat March, 1960. Previous to the order passed by the Sub divisional Controller, Food and Supplies, Barrackpore, dated 18th May, 1959 retail dealers in soft coke, including the petitioners, were permitted to draw their supplies direct from the collieries by road, because the position of wagon supply was very bad. It is stated that in September, 1959 the supply of wagons improved, with the result that it was no longer necessary or expedient to allow retail dealers to indent from the collieries direct, by road. It is said that wholesale dealers have been now appointed, as contemplated by the said order, and the retail dealers have been directed to draw their supplies from such wholesale dealers. It is further said that the margin of profit has been carefully calculated, and although the introduction of whole sellers cuts into the profits hitherto enjoyed by the retailers, there is still a sufficient margin of profit and it is denied that the petitioners have been compelled to close their business. Before me, a point has been taken that paras. 13, 18 and sub-paras. 2 and 3 of para. 7 of the order are not within the power of delegation conferred by the Government of India upon the Government of West Bengal, and that the provisions of the order whereby power has been conferred upon the "director" and the "district Magistrate" to do various acts under the said order, are had, for reasons which will be presently mentioned. It is urged that the order is violative of the fundamental rights of the petitioners to carry on business under Article 19 (1) (g) of the Constitution. In this particular case, the impugned order has been passed by the Sub-divisional Controller of Food and Supplies, Barrackpore, in exercise of the power delegated to him by the District Magistrate. It is argued that the power of delegation or authorisation is bad and, therefore, the order itself is void. It is necessary to state the genesis of the West Bengal Soft Coke Distribution Order, 1955. The Essential Commodities Act, 1955, being Act No. X of 1955 was promulgated on or about 1st April, 1955 and it is not disputed that it is still in operation. Section 3 of the said Act grants power to the Central Government, if it is of the opinion that it was necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing equitable distribution and availability at fair prices, to make an order providing for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein. Sub-section (2) of section 3 of the said Act, gives certain headings which are illustrative of such power. Clause (c) provides for the control of prices at which any essential commodity may be bought or sold. Sub-clause (d) provides for regulating by licenses, permits or otherwise, the storage, transport, distribution, disposal, acquisition, use or consumption of any essential commodity. Clause (e) provides for the prohibition or withholding from sale of any essential commodity ordinarily kept for sale. Section 5 of the said Act provides that the Central Government may, by notified order, direct that the powers to make an order under section 3 shall, in relation to such matters and subject to such conditions, if any, as may be specified in the direction, be exercisable also by such State Government or such officer or authority subordinate to the State Government, as may be specified in the direction. It appears that by S. R. O. No. 1299 dated 16th June, 1955, notified at pages 1068 and 1069 of the Gazette of India dated the 18th June, 1955, Part II, section 3, the Central Government delegated power to the State Government. In exercise of that power, the State Government, by Order No. 2215sd dated 7th October, 1955, published in the Calcutta Gazette dated 20th October, 1955 Part I. pages 4263-4267, promulgated the West Bengal Soft Coke Distribution Order, 1955. Under paragraph 3 of the said order, "director" means Director, Consumer Goods, Department of Food, Relief and Supplies, West Bengal, and includes any person authorised by the said Director in writing to perform all or any of the functions of the Director under the said order. The expression. "district Magistrate" includes any person authorised by the District Magistrate in writing to perform all or any of the functions of the District Magistrate under the said Order. Paragraph 4 of the Order prohibits the carrying on in any area, where the Order comes into force, the sale of soft coke or carrying trade in it, unless by a person who is in possession of a valid license issued under paragraph 5 and paragraph 7, and except in accordance with the conditions specified in the said license. Paragraph 5 lays down that all applications for the issue of a license or renewal thereof, within the Calcutta area shall be made to the Deputy Director, Consumer Goods (Fuels), and in respect of any other area to the District Magistrate having jurisdiction in such area, in the prescribed form. Clause 3 or para. 7 is important and is set out below:- "a retail dealer or any person acting on his behalf shall purchase soft coke only from a wholesale dealer duly licensed under paragraph 6 of the said order except in the case where the Director or the District Magistrate, as the case may be, may allow a retail dealer to purchase soft coke from other sources. "
(2.) PARA. 13 lays down that every licensee must comply with any special or general direction issued in writing by the Director or the District Magistrate as the case may be, for securing proper distribution of soft coke or for carrying out the purposes of the said Order. In order to decide the first point taken in this case it is necessary to consider the instrument of delegation whereby the Central Government has delegated power under section 5 of the Essential Commodities Act, to the State Government. That delegation is contained in the notification, being SRO No. 1299 dated 10th June, 1955 published in the Gazette of India dated 18th June, 1955, Part I, Section 3 at pages 1088-1089. By that notification powers to be exercised by the Central Government under clauses (c), (d), (e), (f), (h), (i) and (j) of clause 3 (2) of the said Act were to be exercised, inter alia, by the State Governments of all Part A States, in respect of the distribution of coal received within the State from time to time against quotas fixed by the Central Government. The West Bengal Government, in exercise of the power so delegated to it, promulgated the West Bengal Soft Coke Distribution Order, 1955. Subsequently, by S. R. O. No. 1185 dated the 2nd April, 1957 a further Order has been issued by the Central Government delegating to the State Government, power in respect of distribution of coal received within their respective jurisdictions otherwise than against the central Government's quota. The West Bengal Soft Coke Distribution Order, 1955 does not however purport to be made under this notification, as indeed it could not be, having been passed prior to the publication of this notification. However, no point has been taken before me that the soft coke which was being indented by the petitioners was not covered by S. R. O. No. 1299. The point of delegation has been propounded before me as follows: It is said that the Essential Commodities Act confers powers of delegation upon lite Central Government, and such delegation can be made to any State Government or an officer or authority subordinate to the State Government. Therefore, the Central Government could make a delegation, either to the State Government of West Bengal, or directly in favour of the District Magistrate or even the Sub divisional Controller of Food and. Supply, Barrack-pore. The fact is, however, that the Central Government has delegated power to the State Government of West Bengal. It is argued that the State Government being a delegate has no power to re-delegate, on the principle of Delegatus non potest delegare. That this principle is well-established there can be no doubt. In my opinion, however, we have not here any application of that principle. In considering this point we will have to see as to what power is given to the Central Government, which it is said to have delegated. I think that the matter really comes under the scope of clause (d) of subsection (2) of section 3 of the said Act, which grants power to the Central Government to promulgate orders regulating the supply and distribution of an essential commodity by the issue of licenses or otherwise. This power has been delegated to the State Government in respect of an essential commodity, namely, coal. In exercise of this power, the said Order has been promulgated by the State Government. In other words as long as the delegation lasts, the Stale of West Bengal may promulgate an Older which will contain provisions For the regulation by licenses or otherwise, of the distribution, acquisition, use or consumption etc. of coal, including soft coke. This is what it has purported to do by promulgation of the Order of 1955. By that Order, the State Government has not re-delegated its power to the District Magistrate etc. , of making such an Order. The Director or the District Magistrate as the case may be, are officials who are to carry out the provisions of the Order. Their functions relate to the working out of the provisions of the Order, Thus, the Director or the District Magistrate may issue a license as specified in the Order or give directions for securing the proper distribution of soft coke, and so forth. These officials are not concerned with the making of an order under the Essential Commodities Act. but for carrying out the provisions of on order made thereunder. it is. therefore, not correct to say that there has. been any re-delegation of the power which has been conferred under section 5 of the Act to the State Government.
(3.) THE second and the third points taken, may be conveniently dealt with together. It is propounded as follows As I have stated above, the persons who are entrusted by the Order to carry out its provisions, by the issue of licenses or otherwise are the Director or the Distract Magistrate. But in both cases, the power is not confined to the Director of Consumer Goods or the District Magistrate of a District. By the definition clauses (b) and (c) of para. 3 of the Order, "director" means the Director, Consumer Goods, Department of Food, Relief and Supplies, West Bengal, and includes any person authorised by the said Director in writing to perform all or any of the functions of the Director under the Order. The word "district Magistrate" includes any person authorised by the District Magistrate in writing to perform all or any of She functions of the District Magistrate under the raid Order. It is argued that while it may be a reasonable restriction upon the fundamental right of the petitioners to carry on business in soft coke, to impose conditions, namely than no business could be carried on except with a license etc. issued by important officials like the Director or the District Magistrate, it is wholly unreasonable that these officials can authorise any and every person to carry out their functions it is argued that such provision makes the West Bengal Soft Coke Distribution Order, 1955 violative of the provisions of Art. 19 (1) (g) of the Constitution and is not saved by Art. 19 (6), inasmuch as the provisions of the Order do not amount to a reasonable restriction. The phrase "reasonable restriction'' has been interpreted by various decisions of the Supreme Court. In Chintamon Rao v. State of Madhya Pradesh (1) A. I. R. (1959) S. C. 118. Mahajan, J. , said as follows:- "the phrase 'reasonable restriction' connotes that the limitation imposed on a person in enjoyment of the right should not be arbitrary or of an excessive nature, beyond what is required in the interests of the public The word 'reasonable' implies independent care and deliberation, that is choice of a course which reason dictates legislation which arbitrarily or excessively invades the right cannot be said to contain quality of reasonableness and unless it strikes a proper balance between freedom guaranteed in Art. 19 (1) (g) and the social control permitted by clause (6) of Art. 19 it must be held to be wanting in that quality. ";


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