Satish Chandra, C.J. - (1.) The petitioners are licensed millers. Under the U. P. Rice and Paddy (Levy) Order, 1968, they sold 60% of their production to the State Government on payment of the scheduled price mentioned in that control order. In the usual course of business, the petitioners sold the levy rice to the Government. After a while, the Government faced shortage of storage facility. The petitioners godowns were taken and the rice sold by the petitioners to the Government was kept in those godowns under lock and key of the Government departments. After some time, the rice so stored was despatched in accordance with the Government requirements. At the time oi despatch, it was discovered that there was loss in weight. The respondents held the petitioners responsible for this loss. They evaluated the loss and calculated the amount payable by the petitioners on that account. In due course, they started deducting the loss so determined from the payment that were to be made to the petitioners for the sale of the current stock of levy rice (at the rate of 60% of the current production). The petitioners felt aggrieved at this forcible deduction. They came to this Court with a prayer that the respondents be directed not to make these illegal deductions.
(2.) The respondents case is that at the time of sale of the levy rice, the petitioners voluntarily offered to keep them in their own godowns on a specific undertaking that they will be responsible for the loss of quality and quantity of the stored rice so long as it remained stored in their godowns. At the time of despatch, it was found that there was loss of weight for which the reason was loss of moisture content of the stored rice due to defective storage facilities. In view of the undertaking given by the petitioners, they were responsible to make good this loss. Since they failed to pay, the respondents were obliged to make the deductions from the price payable to the petitioners for the current supply of levy rice.
(3.) The position under the U. P. Rice and Paddy (Levy) Order, 1968, is that by clause 3 of that Order, every licensed miller is to sell to the State Government at the scheduled price 60 % of his production. Under clause 5, the scheduled price is for fair average quality of rice or paddy of a variety described in Schedule II and conforming to the specifications prescribed in Schedule III and has to be subject to the deductions specified in column 5 of Schedule III. Schedule II prescribes the price payable for each variety of rice or paddy. Schedule III prescribes the quality specifications for fair average quality of rice. At serial number 8 is the heading 'moisture. The tolerance limit is 13.5%. In column 5, it has been stated: "Rice in which moisture exceeds the limit specified in column 3 shall not be deemed to be superior Basmati rice." There is no dispute that at the time of sale, the moisture content of the rice sold by the petitioner was usually more than 13.5%. It was 15% or 15% or near-about. But since the tolerance limit was 13.5%, the respondents made payment treating the petitioners rice to be of fair average quality considering that its moisture content is 13.6%. In fact, the moisture content was 16%, but the petitioners were made payments as if moisture point was 13%, namely, the petitioners were not paid the price of 3% of the rice on the ground that moisture content was beyond the tolerance limit. Thus far there is no dispute.;