Shah, J. - (1.) By S. 37 of the Mysore Forest Act 11 of 1900 the State Government is authorized to make rules to regulate the "transit of * * forest produce". In exercise of the powers conferred by S. 37 the State Government of Mysore has framed rules to regulate the "transit of timber, fire-wood, charcoal and bamboos from all lands". By R. 2 framed on October 13, 1952 it was provided that no person shall import forest produce into, export forest produce from, or move forest produce within, any of the areas specified in Sch. 'A' (hereinafter referred to as the Scheduled area), unless such forest produce is accompanied by a permit prescribed in R. 3. On April 15, 1959 the State of Mysore issued a notification adding a provision to R. 2 which read as follows:"Provided that no such permit shall authorise any person to transport forest produce between sun-set and sun-rise in any of the areas specified in Sch. "A".'' By another notification, dated September 14, l960, the State Government introduced the second proviso to R. 2 which read: "Provided further that permission may be granted to timber merchants on their requisition to transport timber upto 10 p.m. (22 hrs.) under the following conditions:- (i) the party who wishes to avail of the concessions should pay a cash deposit of Rs. 1,000 as security for due compliance with the timber transit rules as in force: (ii) that the deposit may be forfeited to Government for breach of any of the condition of the Timber Transit Rules."
(2.) The respondent who is a dealer in timber filed a petition under Art. 226 of the Constitution for an order quashing the two provisos to R. 2. on the grounds inter alia that the two provisos were beyond the rule making authority conferred upon the State Government by S. 37 of the Mysore Forest Act 11 of 1900, and that in any event the provisos imposed unauthorised restrictions on the freedom of trade, commerce and intercourse. The High Court of Mysore held that by the provisos inserted in R. 2 the State Government had while seeking to regulate the transport of timber "stopped transport altogether," and in doing so the State Government acted in excess of the powers conferred upon it by S. 37 of the Act. The High Court also held that the two provisos were not saved by Art. 305 of the Constitution and since the function of the two provisos was not regulatory but prohibitory, they were violative of Art. 301 of the Constitution and must be struck down as unconstitutional. With special leave granted by this Court, the State of Mysore has appealed to this Court.
(3.) Section 37 (1) of the Mysore Forest Act 11 of 1900, provides: "The control of all rivers and their banks as regards the floating of timber, as well as the control of all forest produce in transit by land or water, is vested in the State Government which may make rules to regulate the transit of any forest produce." Sub-section (2) provides: "Such rules may, among other matters, (a) * * * (b) prohibit the import, export, collection or moving of forest produce without a pass from an officer authorized to issue the same or otherwise than in accordance with the conditions of such pass". By R. 2 which is framed in exercise of the power under S. 37 (2) (b), a person intending to transport forest produce must, obtain a pass from an authorised officer. The rule so made is clearly regulatory of the right to transport forest produce. But a restriction is imposed on the right to transport forest produce by the two provisos incorporated in the rule in 1959 and 1960. By the first proviso the holder of a pass is not authorized to transport forest produce between the hours of sun-set and sunrise in any area specified in Sch. 'A', and by the second proviso it is provided that the restriction in posed by the first proviso may be relaxed between the hours of sun-set and 10 p. m if the person wishing to avail of the concession makes a cash deposit of Rs. 1,000 is security for due compliance with the "timber transit rules'. By the terms of the two provisos there is an absolute prohibition against transportation of forest produce between the hours of 10 p.m. and sun-rise, and a qualified prohibition between the hours of sun-set and 10 p.m. If a transporter of forest produce makes a cash deposit of Rs. 1,000 as security, he may be permitted to transport forest produce between the hours of sun-set and 10 p.m.;