LODHA, J. -
(1.)THIS Writ petition has been filed under Art. 226 of the Constitu-tion of India challenging the constitutionality and validity of the Cement Contro Order, 1967.
(2.)THE petitioner is a Limited Company. It is carrying on business in the manufacture of cement and has a factory at Sawai Madhopur in the State of Rajasthan.
In exercise of the powers conferred by secs. 18-G and 25 of the Industries (Development and Regulation) Act. 65 of 1951 (which will hereinafter be called the Act) and other powers enabling it in that behalf the Central Government made the Cement Control Order 1967. (which will hereinafter be called "the Order"). Sec. 18-G of the Act, which deals with the powers of the Central Government to control supply, distribution, price etc. of certain articles, reads as follows : "18G. (1) The Central Government, so far as it appears it to be necessary or expedient for securing the equitable distribution and availability at fair prices of any article or class of articles relatable to any scheduled industry, may, notwithstanding any thing contained in any other provision of this Act, by notified order, provide for regulating the supply and distribution thereof and trade and commerce therein. (2) Without prejudice to the generality of the powers conferred by sub-sec. (1) a notified order made thereunder may provide : (a) for controlling the prices at which any such article or class thereof may be brought or sold; (b) for regulating any licenses, permits or otherwise the distribution, transport, disposal, acquisition, possession, use or consumption of any such article or class thereof; (c) for prohibiting the withholding from sale of any such article or class thereof ordinarily kept for sale; (d) for requiring any person manufacturing producing or holding in stock any such article or class thereof to sell the whole or part of the articles so manufactured or produced during a specified period or to sell the whole or part of the articles so held in stock to such person or class of persons and in such circumstances as may be specified in the order; (e) for regulating or prohibiting any class or commercial or financial transactions relating to such articles or class thereof which in the opinion of the authority making the order are, or if unregulated are likely to be, detrimental to public interest; (f) for requiring persons engaged in the distribution and trade and commerce in any such article or class thereof to mark the articles exposed or intended for sale with the sale price or to exhibit at some easily accessible place on the premises the price-lists of articles held for sale and also to similarly exhibit on the first day of every month, or at such other time as may be prescribed, a statement of the total quantities of any such articles in stock; (g) for collecting any information or statistics with a view to regulating or prohibiting any of the aforesaid matters; and (h) for any incidental or supplementary matters, including, in-particular, the grant or issue of licenses, permits or other documents and the charging of fees therefor. (3) Whereas, in pursuance of any order made with reference to clause (d) of sub-sec. (2), any person, sells any article, there shall be paid to him the price therefor : (a) where the price can consistently with the controlled price, if any, be fixed by agreement, the price so agreed upon; (b) where no such agreement can be reached, the price calculated with reference to the controlled price, if any, fixed under this section; (c) where neither clause (a) nor clause (b) applies; the price calculated at the market rate prevailing in the locality at the date of sale. (4) No order made in exercise of any power conferred by this section shall be called in question in any court. (5) Where an order purports to have been made and signed by an authority in exercise of any power conferred by this section, a Court shall, within the meaning of the Indian Evidence Act, 1872, presume that such order was so made by that authority. Explanation - In this section, the expression "article or class of articles" relatable to any scheduled industry includes any article or class of articles imported into India which is of the same nature or description as the article or class of articles manufactured or produced in the scheduled industry." Sec. 25 deals with delegation of powers and it runs as under : "25.(1) The Central Government may, by notified order, direct that any power exercisable by it under this Act (other than the power given to it by sec. 16 and 18A) 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 officer or authority (including in the said expressions any Development Council, State Government or Officer or authority subordinate to the Central Government) as may be specified in the direction. (2) Any power exercisable by a State Government by virtue of a direction under sub-sec. (1) may, unless otherwise provided in such direction, be exercised also by such officer or authority subordinate to that State Government as it may, by notified order, specify in this behalf.
We may at this stage also refer to the provisions of the Order as it is their validity that is the main point for our determination in this petition. The preamble of the Order recites that : "For the purpose of securing the equitable distribution and availability at fair prices of cement, the supply and distribution of, and trade and commerce in, cement should be regulated."
Clause (2) of the Order is the definition clause. Sub-Caluse(b) defines "controller" as meaning the Cement Corporation of India Limited.
Clause (3) deals with the power of the Central Government to prohibit removal of cement and runs as follows : "3. Power to prohibit removal - No producer shall remove or permit the removal of any cement, whether sold or unsold, from the precincts of his factory or from any other part of his premises to any place outside the precincts of such factory or premises except with the previous permission in writing of the Central Government".
Clause (4) confers power on the Central Government to direct sale or transport and reads as under : "4. Power to direct sale or transport - The Central Government, by order, require any producer to sell cement to such person or class of persons or to transport cement to such destinations by such modes of transport, and on such terms and conditions, as may be specified in the order."
Clause (5) deals with the power of the Central Government to direct disposal of stock : "5 Power to direct disposal of stock - The Central Government may, with a view to securing proper distribution of cement, issue such orders, general or special, as may be necessary, to any producer as to the disposal of his stock."
Clause (6) deals with the maintenance and production of accounts, etc. by every producer, of cement, when required by the Central Government.
It would be proper to reproduce the rest of the clauses of the order in extenso as the validity of almost all of these clauses has been called into question - "7. Retention prices - The ex-factory prices admissible to the producer for the different varieties of cement shall be as specified in the Schedule. 8. Price at which producer may sell - No producer shall, himself or by any person on his behalf, sell - (a) rapid hardening cement at a price exceeding Rs. 148.53 per metric tonne. (b) any other variety of cement at a price exceeding Rs. 125.53 per metric tonne, free on rail destination railway station plus the excise duty paid thereon, Provided that in the case of packed cement, there shall be added to the price referred to in this clause such charges as may be fixed by the Central Government in respect of packing or the containers and the Central Government may fix different charges for different kinds of packing or containers, as the case may be. Provided further that the Central Government may allow rebate, discount or commission in the price of cement sold to the Government through the Directorate General of Supplies and Disposals or intended for export out of India. Explanation - For the purposes of this order, the expression "free on rail destination railway Station" means the price (including the cost of transport by the cheapest mode except where any other mode of transport has been specified by the Central Government under cl. (4) at the destination point. 9. Payment of Cement Regulation Account - (1) Every producer shall, in respect of each transaction by way of sale of cement effected by him, pay within one month of the date on which he realises the price of such cement, to the Controller, an amount equivalent to the amount, if any, by which the free on rail destination price of such cement realised by him exceeds the aggregate of the following amounts, namely - (i) the ex-factory price of such cement calculated in accordance with the rates specified in the Schedules; (ii) a selling agency commission calculated at the rate of Rs. 1.25 per metric tonne; (iii) the excise duty paid thereon and (iv) in the case of packed cement, the charges fixed by the Central Government in respect of the packing or the containers under the first proviso to Cl. 8. Provided that the expenditure incurred by the producer on freight by the cheapest mode of transport or where any other mode of transport has been specified by the Central Government under clause 4, by such mode of transport in respect of such transaction shall be reimbursed to the producer by the Controller from out of the Cement Regulation Account referred to in clause 11. 10. Wholesale and retail prices - (1) the maximum price at which cement may be sold by a dealer (whether wholesale or retail) shall be such as may be fixed by the State Government and no dealer (whether wholesale or retail) shall sell cement exceeding such maximum price. (2) In fixing the maximum price under sub-cl. (1), the State Government shall have due regard to : - (i) the price fixed under clause 8; (ii) handling (including charges in respect of packing or containers) and transporting charges; (iii) godown charges; (iv) stockist's commission : (v) local taxes, if any.
Cement Regulation Account - (1) The Controller shall maintain an account to be known as the Cement Regulation Account to which shall be credited the amounts paid by the producer under clause 9 and such other sums of money as the Central Government may, after the appropriation made by Parliament by law in this behalf, be granted by the Central Government. (2) The amount credited under sub clause (1) shall be spent only for the following purposes, namely : - (i) paying or equalising the expenditure incurred by the producer on freight in accordance with the provisions of this Order; (ii) equalising concession, if any, granted in the matter of price for supplies to Government or for purposes of export under the second proviso to clause 8, (iii) expenses incurred by the Controller in discharging the functions under this Order subject to such limits, if any, as may be laid down by the Central Government in this behalf. (3) The Controller shall cause accounts be kept of all moneys received and expended by him from out of the Cement Regulation Account and he shall prepare and submit such report and returns relating to the said Account as may be required by the Central Government form time to time. (4) The balance, if any remaining unspent in the Cement Regulation Account shall be disbursed in accordance with such directions as may be given by the Central Government in this behalf.
Power to vary the prices and to alter the Schedule - The Central Government may, having regard to any change in any of the factors, relevant for the determination of prices of cement, such as an increase or decrease in the cost of production or distribution, by notification in the Official Gazette, vary the price fixed in this Order or alter the Schedule to this Order as appear to it to be necessary.
Delegation - All powers exercisable by the Central Government under this Order except under clauses 8, 11(2) and 12 shall also be exercisable by the Controller.
(3.)PROCEDURE regarding claims by producers - Every producer shall make an application regarding his claim for any reimbursement towards equalising freight or equalising concession in the matter of export price to the Controller who may, in setting the claim, require the producer to furnish all details relating thereto, including the cost of freight incurred, excise duty, if any paid, etc. THE SCHEDULE (See clause 7) Name of producer Price per metric tonne. Ex-Works Price : 1. M/s. Dalmia Cement (Bharat) Ltd., Dalmianagar. 2. M/s Andhra Cement Co. Ltd., Vijayawada. 90.50 3. M/s Orrisa Cement Ltd., Raj gangapur. 90.50 4. M/s K.C.P. Ltd., Macherla. 90.50 upto an annual production of 115,000 tonne's. 96.00 for every tonne beyond 115,000 tonnes per annum. 5. M/s Rohtas Industries Ltd., Dalmianagar. 90 50 6. M/s Mysore Iron & Steel Works Ltd., Bhadravati. 90 50 7. M/s Associated Cement Company Ltd. : - New Porbandar Works. 96.00 Jamul Works. 96.00 Dwarka Works. 90.50 90.50 upto annual production of 245,000 tonnes.96.00 for every tonne beyond 245,000 tonnes per annum. Other Works. 90.50 8. U.P. Government Cement Factory, Churk. 90.50 upto an annual production of 220,000 tonnes. 96.00 for every tonne beyond 220,000 tonnes per annum. 9. M/s Dalmia Dadri Cement Ltd., Dalmia Datri. 90.50 10. M/s Bhagalkot Cement Co. Ltd. Bagalkot. 90.50 11. M/s Ashoka Cement Ltd. Dalmianagar. 90.50 12. M/s Jaipur Udyog Ltd. Sawai-madhopur. 90.50 13. M/s India Cements Talaiyuthu Works. 93.50 Sankaridrug Works. 96.00 14. M/s Birla Jute Mfg. Co. Ltd., Satna. 93.50 upto an annual production of 225,000 tones. 96 00 for every tonne beyond 225,000 tonnes per annum.
M/s. Birla Jute Mfg. Co. Ltd., Chittorgarh. 96.00
M/s. Shree Digvijay Cement Co. Ltd., Sikka Works. 93.50 upto an annual production of 260,000 tonnes. 96.00 for every tonne beyond 260,000 tonnes per annum provided that the combined production of the Sikka & Sewree Works is not less than 410,000 tonnes in that year. Sewree Works. 129.75 exclusive of actual wharfage charges paid at Sikka on Clinker.
Kalyanpur Lime & Cement Works Ltd., Banjari. 96.50 upto an annual production of 150,000 tonnes. 96.00 for every tonne beyond 150,000 tonnes per annum.
Sone Valley Portland Cement Co. Ltd. Japla. 93.50
M/s Panyam Cement & Mineral Industries Ltd. Cement Nagar. 96.00