Skip to content


Ramappa Bhimappa Kulgod and ors. Vs. the Union of India, New Delhi and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtKarnataka High Court
Decided On
Judge
Reported inAIR1977Kant100; ILR1977KAR485; 1977(1)KarLJ187
ActsEssential Commodities Act, 1955 - Sections 3 and 5; Cotton Textiles (Control) Order, 1948
AppellantRamappa Bhimappa Kulgod and ors.
RespondentThe Union of India, New Delhi and ors.
Appellant AdvocateB.V. Deshpande and ;C.N. Kamath, Advs.
Respondent AdvocateU.L. Narayana Rao, Sr. Central Govt. Standing Counsel, ;R.N. Byra Reddy, Adv. General and ;M.P. Chandrakantha Raj Urs Government Adv.
Excerpt:
.....set aside the punishment. further, the gravity of the charge cannot be ignored, unless the workman establishes that the delay has vitally prejudiced his case. just because there is delay, the punishment cannot be altered when the charge of fraud is proved. award was set aside. - the ever-changing needs of the general public relating to the essential commodity like cloth have to be met from time to time, by making it available at fair price. to achieve this object, the textile commissioner is expected to closely watch the- changing conditions and take such remedial measures as he thinks best by issuing suitable directions to the manufacturers regarding the production or non-production of cloth and the maximum or the minimum quantities thereof. 12. in the result, and for the reasons..........in these appeals, it is necessary-to set out the history of the legislation, which empowered the textile commissioner to issue the impugned notification. under the defense of india act, 1939, the rules were framed to meet the emergency, which had arisen as a result of the second world war. rule 81 (2) (b) of the rules authorised the central government, inter alia, so far as appears to it necessary or expedient for securing the defense of british india or the efficient prosecution of war or maintaining supplies and services essential to the life of the community, to provide by order for controlling the prices, or rates at which articles or things of any description whatever may be sold or hired and for relaxing any maximum or minimum limits otherwise imposed on such prices or rates. on.....
Judgment:

Jagannatha Shetty, J.

1. These Writ Appeals are against the common order made by learned Single Judge in W. P. Nos. 1102, 1115 of 1972 and W. P. Nos. 4653 and 5606 of 1974. The validity of the notification dated 9th November 1966 issued by the Textile Commissioner was challenged in those writ petitions. The learned Judge has upheld the validity of that notification and dismissed the writ petitions.

2. For a proper appreciation of the contentions raised in these appeals, it is necessary-to set out the history of the legislation, which empowered the Textile Commissioner to issue the impugned notification. Under the Defense of India Act, 1939, the rules were framed to meet the emergency, which had arisen as a result of the Second World War. Rule 81 (2) (b) of the Rules authorised the Central Government, inter alia, so far as appears to it necessary or expedient for securing the defense of British India or the efficient prosecution of War or maintaining supplies and services essential to the life of the community, to provide by order for controlling the prices, or rates at which articles or things of any description whatever may be sold or hired and for relaxing any maximum or minimum limits otherwise imposed on such prices or rates. On September 25, 1946, Ordinance called, the Essential Supplies (Temporary Powers) Ordinance (XVIII of 1946) was promulgated providing power to the Central Government for maintaining or increasing supplies of any essential commodity, or for securing their. Equitable distribution and availability at fair -prices, or to prohibit the Production, supply and distribution thereof, and trade and commerce therein. On November 19, 1946, Act No followed the Ordinance. XXIV of 1946, called, the Essential Supplies (Temporary Powers) Act, 1946 re-enacting the provisions of the Ordinance.

Section 3 of the Act provided, inter alia, that the Central Government, so far as it appears to it necessary or expedient for maintaining or increasing supplies. Of any essential commodity or for securing their equitable distribution and availability at fair prices, may, by notified order, provide for regulating or prohibiting the Production, supply and distribution thereof, and trade and commerce therein. The essential commodities, which were covered by the Act, were defined by S. 2 (a) as meaning. 'Any of the classes of commodities, specified'. They included cotton and woolen textiles. The Act having provided for the delegation of specified powers to the Central Government by S. 3- also provided for sub-delegation by S. 4. Under this section, the Central Government was authorised to direct by notified order that the power to make orders under S. 3, shall, in relation to such. Matters and subject to such conditions if any, as may be specified in the direction, be exercisable by (a) such officer or authority subordinate to the Central Government, or (b) such Provincial Government or such officer or authority subordinate to a Provincial Government as may be specified in the direction. In exercise of the powers conferred by S. 3, the Central Government made the Cotton Textiles (Control) Order, 1948. Clause (20) of that order conferred power on the Textile Commissioner to issue directions to the producer or manufacturer or to class of producers or manufacturers generally regarding. The maximum or minimum quantities of cloth or yarn and also authorised him to issue directions prohibiting such production. The life of Act No. XXIV of 1946 was continued from time to time, until the Essential Commodities Ordinance I of 1955 was promulgated which was later replaced by the Essential Commodities Act, 1955 (Act No. 10 of 1955) The Act was thus put on the statute book, as a permanent measure. Sections 3 and 4 of Act No. XXIV of 1916 are similar to Ss. 3 and 5 of Act No. 10 of 1955. The Cotton Textiles (Control) Order, 1948 was, however, saved and continued in force by the repeal and saving provisions of the 1955 Act.

3. We may now set out the relevant notifications issued wider Clause (20) of the Cotton Textiles (Control) Order, 1948. On April 15, 19-50, the Textile Commissioner in exercise of the powers conferred there under, issued a notification, the relevant portion of which reads as follows: -

'1. (i) xx xx xx(ii) Directions 9 (a), 9 (b) and (c) shall be complied with by all producers who have a spinning plant. Directions (d) and (e) shall be complied with by all producers who have no spinning plant. The remaining directions 2 and 8, 9 (a), 9 (c), 10 and 11 shall be complied with by all producers, that is to say, both by producers who have a spinning plant and those who have not.

(iii) xx xx xx(iv) These directions excepting direction No. 3 shall not apply to:

(a) t o cloth manufactured for export and marked with export markings;

(b) to cloth which is produced on a power-loom in a Government institution and which is sold as Government property;

(c) to a producer who has less than 5 looms in his -possession or under his control but is, not a producer who whether by himself or in partnership jointly with others had 5 or more looms in his -possession or under his control on 31st March 1950. xx xx xx xx xx xx

9. Sarees.

(a) No producer shall produce any saree with borders exceeding 21' in width or use real or imitation zari in a saree border;

(aa) No producer who has a spinning plant shall produce a saree with border of 1/4' or less in width and containing colored yarn in its border unless he has previously sent to the Textile Commissioner, sample of such cloth of the dimension of 6'X6' and has received the Textile Commissioner's approval of such sample for bulk manufacture:

(b) No, producer who has a spinning plant shall use gold colored yarn, art silk yarn in a saree borders;

(c) No producer who has a spinning plant shall use any colored yarn, in the body of the saree except in a heading thereof;

(d) No producer who has no spinning plant shall produce a saree with a striped or check pattern in which a colored yam is used;

(e) No producer shall produce any saree with heading more than 9' in width;

(f) No producer who has no spinning plant shall produce any saree with the count of yam below 36s.

(Whether warp or weft and whether Single or folded).

xx xx xx xx xx xx The above notification directed that the owners having five or more power looms should not manufacture sarees. But those who had less than five looms were, however, free to manufacture such sarees.

4. Interrupting the narration, we may briefly narrate one other fact, On January 9, 1963, the Government of India constituted a committee headed by Sri, Ashoka Mehta, to consider the problems of the power loom, industries. The Committee was also authorised to consider and report on the relative role to be played by the power loom industry and also the handloom and the mill industry. In May 1964, the Committee submitted its detailed recommendations to the Government of India. One of the recommendations of the Committee was that the -production of colored sarees should be exclusively reserved for handlooms. After taking into consideration the recommendations,. The Government of India passed a resolution of June 2, 1966 accepting in particular the aforesaid recommendation.

On November 9, 1966, the Textile Commissioner, in exercise of the powers conferred on him by Clause (20) of the Cotton Textiles (Control) Order, 1948 issued another notification, the validity of which falls to be determined in the present appeals. The said notification reads thus:

'In exercise of the powers conferred on me by Clause 20 of the Cotton Textiles (Control) Order, 1948, 1. P. J. Fernandes, Additional Textile Commissioner, hereby make the following further amendment to the Textile Commissioner's Notification No. 9 (9) TEX (1)149 dated the 15th April, 1950, namely: -

In the said Notification-

in direction 1,-(a) for Item (ii), the following shall be substituted namely:-

'(ii) These directions, except directions 2 (2) and 9 (c) and (d) shall not apply to, a producer who has less than 5 looms in his possession or under his control and who, whether by himself or in partnership or jointly with others, had 5 or more looms in his possession or under his control on the 31st March, 1950;'

(b) Clause (c) of Item (iv) shall be omitted.

.(2) for direction 2, the following shall be substituted, namely:

'2. Dhoties (1) No producer shall produce a dhoti with borders exceeding 6.35 mm in width, containing colored yarn, or use zari or muga or art silk yarn in a dhoti border.

(2) No producer shall piece-dye any dhoti.

Explanation I:- For the purpose of this direction dhoti means any type of grey or bleached cloth, whether or not mercerised, of plain weave which-

(i) is manufactured either wholly from cotton or -partly from cotton and partly from any other material;

(ii) contains white or colored yarn on its borders or headings;

(iii) has a width ranging between 71 centimeters (inclusive); and

(iv) is commonly known by that name.

Explanation II. The width of the border of a dhoti shall mean the total width measured from the extreme end of the selvedge of the fabric to the -portion enclosed by the innermost colored and inserted in the border.'

3. in direction 9: -

(i) in Item (c), the words 'who has a spinning plant' shall be omitted;

(ii) for Item. (d), the following shall be substituted, namely: -

'(d) No producer shall piece-dye any saree'.

(iii) for Explanation 1, the following Explanation shall be substituted, namely:

'Explanation I- For the purposes of this direction, 'Saree' means any type of grey or bleached cloth whether or not mercerised, of plain weave which-

(i) is manufactured either wholly from cotton or Partly from cotton and partly from any other material;

(ii) contains colored yarn or white yarn on its borders or headings,

(iii) has a width ranging from between 94 centimeters to 137 centimeters (inclusive) and xx xx xx.'

By the above notification, the exemption provided to the owners having less than five power looms to manufacture sarees, was taken away. Consequently, the power loom owners have now been totally prohibited from manufacturing colored sarees and such sarees have been exclusively reserved for handloom sector.

5. Before the learned single Judge, several questions on the vires of the notification were urged. But we are not put to the necessity of examining all these contentions At -the time of admitting the Writ Appeals, the appellants have filed a memo stating that they would, withdraw all the grounds of challenge based on Articles 14 and 19 of the Constitution and to that effect, the Bench has made an order dated January 27, 1976. The principal contention urged before us is that the notification dated November, 9, 1966, considered in the light of Clause (20) of the Cotton Textiles (Control) Order, 1948 is invalid inasmuch as the Textile Commissioner has not specified the period during which the notification shall remain in operation.

6. Before we address ourselves to the question about the vires of notification dated November 9, 1966, it is necessary to make it clear that the validity of Clause (20) of the Cotton Textiles (Control) Order, 1948 has not been disputed before us, and indeed it cannot be disputed in view of the provisions of Ss. 3 and 4 of Act No. XXIV of 1946 or Ss. 3 and 5 of Act No. X of 1955, as these sections does not suffer from the vice of excessive delegation. [See Harishankar Bagla v. State of Madhya Pradesh, : 1954CriLJ1322 .]

7. We may now set out Clause (20) of the Cotton Textiles (Control) Order, 1948. The said clause as amended by Government of India Notification dated February 24, 1962, is in these terms:

'20. (1) The Textile Commissioner may from time to time issue directions in writing to any manufacturer or class of manufacturers or the manufacturers generally, regarding the classes of or specifications of cloth or yarn, and the maximum or the minimum quantities thereof, which they shall or shall not produce during such periods as may be specified in the directions, and they shall comply with such directions.

(2) In the exercise of the powers conferred upon him by sub-clause (1) The Textile Commissioner shall have regard to the capacity of the manufacturer to produce cloth and yarn of different descriptions or specifications and to the needs of the general public.'

Now, what does Clause (20) purport to do? It purports to confer power on the Textile Commissioner to issue written directions from time to time. Such directions may be to individual manufacturer or class of manufacturers. The directions may be regarding the classes of or specifications of cloth or yarn, which the manufacturers shall or shall not manufacture. The directions may -provide the maximum or minimum quantities to be produced by the manufacturers. Such directions may specify the period, during which the manufacturers shall not produce the type of cloth or yarn or the quantities thereof. When such directions are issued, the manufacturers are bound to comply with the same. While issuing any such direction, the Textile Commissioner shall have regard to the matters set out under subclause (2). He shall have regard to the capacity of the manufacturer to produce cloth or yarn of different descriptions or specifications and above all, to the needs of the general public.

Now, the only infirmity pointed out in the Notification in question is that it has not specified the period during which the manufacturers or the appellants have been prevented from manufacturing colored sarees. The question is, whether the specification of such -period is imperative in every notification to be issued under Clause (20). For reasons to follow, the answer to the question, in our opinion. Must be in the negative.

In ordinary usage, 'may' is permissive and 'must' or 'shall' is imperative, and in accordance with such usage, the word 'may' in a statute will not generally be held to be mandatory But there is no universal rule for such construction, Mere Phraseology of the provision is not decisive, It is the duty of Courts of Justice to try to get the real intention of the Legislature by carefully attending to the whole scope of the statute to be construed. In State of Uttar Pradesh v. Babu Ram Upadhya, : 1961CriLJ773 , the Supreme Court observed at pare. 29, p 765, thus:

'When a statute uses the word 'shall', prima facie, it is mandatory, but the Court may ascertain the real intention of the legislature by carefully attending to the whole scope of the statute, For ascertaining the real intention of the Legislature the Court may consider, inter alia, the nature and the design of the statute, and the consequences which would follow from construing it the one way or the other the impact of other, provisions whereby the necessity of complying with the provisions in question is avoided, the circumstances, namely, that the statute provides for a contingency of the noncompliance with the provisions, the fact that the non-compliance with the provisions is or is not visited by some penalty, the serious or trivial consequences that flow there from, and above all, whether the object of the legislation will be de feted or furthered'

It is, therefore, our duty to ascertain first the object intended to be served by the statute, and then determine the relation of Clause (20) of that object. Upon a review of the entire matter, we must decide whether the direction to the Textile Commissioner as to specification of any period in his notification is imperative or only directory.

Under the Essential Commodities Act, the Legislature has declared its decision that the commodities in question are essential for maintenance and progress of national economy. It has also expressed its determination that in the interest of national economy, it is expedient that the supply of the said commodity should be maintained or increased as circumstances may require, and the commodities should be made available for equitable distribution at fair prices. This is apparent if one looks at the preamble and the material words used in S. 3 of the Essential Commodities Act, 1955. By S. 3, the Central Government may, by order provide for regulating or prohibiting the production, supply and distribution of any essential commodity. But the Central Government has delegated its power to make orders under S. 3, to the Textile Commissioner by what is known as the Cotton Textiles (Control) Order, 1948. There under, in respect of cloth and yarn, the Textile Commissioner has been empowered to issue directions from time to time to any manufacturer or class of manufacturers either regarding the classes or specifications of cloth or yarn and the maximum quantities thereof which they shall or shall not produce, It is therefore seen that the Cotton Textiles (Control) Order, 1948, and in -particular Clause (20) therein, is a part of the integrated scheme the policy of which has been laid down by S. 3 of the Essential Commodities Act. Therefore, the Textile Commissioner also has to exercise his powers to achieve the object intended to be served by the said Act. It is important to bear in mind, that in exercising the powers under S. 3, the Central Government could itself have issued an order in the nature of a direction which the Textile Commissioner has been empowered to issue prohibiting the manufacture of colored sarees by power loom sector without specifying any period [during which the order shall remain in operation; because no such condition was stipulated under S. 3.

8. Bearing in mind the above scheme of the Act, we may now proceed to consider the language of Clause (20). By this clause, the Textile Commissioner has been given wide discretion to issue directions from time to time. While issuing any direction, he must 'have regard to' the capacity of the Manufacturer to produce cloth or yarn of different descriptions or specifications and to the needs of the general public. The form of words 'have regard to' in sub-clause (2) of Clause (20), no doubt lends itself to the suggestion that regard should be Paid only to the two matters mentioned i.e., capacity of the manufacturer and to the needs of the general public, But it does not, in our opinion, mean that those two matters only have to be taken into consideration. The Textile Commissioner is not precluded, from considering other relevant matters to make the grant of power effective and to effectuate the legislative intent. On this principle of interpretation, a reference may be made the decision of the Court in Comer. Of Income-tax, West Bengal v. Gangadhar Banerjee and Co., : [1965]57ITR176(SC) :

It must also be stated that the relevant! Factors, which the Textile Commissioner is required to consider, relate to complex Problems of the needs of the general public and distribution of cloth or yarn to them at fair price. These problems evidently keep on changing from time to time. It is Perhaps for this reason that the Textile Commissioner was empowered to issue directions from time to time. The fact that he was empowered to issue directions from time to time itself, in our opinion, suggests that he is not bound to specify the Period in every direction during which it shall remain in force.

9. In support of the contention, learned counsel for the appellants relied upon a Bench decision of the Gujarat High Court in the Sagar Textile Mills Pvt Ltd. v. Sri. Rangaswamy, The Textile Commissioner, (Special Civil Application No. 1346 of 1969), decided on 1-8-1971 (Guj). Divan. J., as tie then was, observed:

' ... ... ... The Power to issue the directions mentioned in sub-clause (1) of Clause (20) has been coupled with the duty to mention the period during which the directions shall remain in force but the duration of the Period is left to the discretion of the Textile Commissioner and it is open to him at the time of exercising the, Power to specify the Period during which the directions to Produce or not to produce any Particular type of cloth or yarn is to remain in force, This conclusion of ours is reinforced when we consider subclause (2) Of Clause (20). By the sub-clause (2) a duty has been cast on the Textile Commissioner to have regard to the capacity of the manufacturer to produce cloth and yarn of different descriptions and specifications and to the needs of the genera public while exercising the powers conferred upon him by sub-clause (1) of C1 (20). The clear intention behind sub-clause (2) is that the powers conferred upon the Textile Commissioner by sub-clause (1) are to be, exercised in the light of the capacity of the manufacturer and also to the needs of the general public. The needs of the general -public will be changing from time to time, and so would the capacity of the different manufacturers, under these circumstances the powers conferred by subclause (1) Have to be exercised with reference to the particular definite period, the duration of the period which has to be specified being left to the discretion of the Textile Commissioner.'

The learned Judge continued:

'Under these circumstances, it is inherent in the object for which the Cotton Textile (Control) Order was promulgated in the first place and continued under the Essential Commodities Act, 1955 and the object for which the power was conferred on the Textile Commissioner to issue directions under Clause 20 was to secure cotton textile at fair price for the general public, i. e. Consumer. Therefore, it was obligatory under the scheme of subclause (1) Of Clause 20 having in view the object of the conferment of the power, that the Textile Commissioner at the time of the exercise of that power to issue directions, must specify the -period during which the directions issued by him were to remain In force. The requirements of the general public go on changing from time to time regarding each essential commodity and in view of these changing circumstances the power conferred upon the Textile Commissioner for issuing directions has been coupled with the duty to specify the period during which the directions are to remain in force. For these reasons, we hold that the contention No. 5 set out here in above must succeed and the impugned notification must be struck down as it does not specify the period during which the prohibition on printing of sarees; with headings and borders is to remain in force.'

With great respect, we are unable to agree with the above view. When it is accepted that the needs of the general public go on varying from time to time, it is almost impossible for anybody to foresee how long a given situation would last. The ever-changing needs of the general public relating to the essential commodity like cloth have to be met from time to time, by making it available at fair price. To achieve this object, the Textile Commissioner is expected to closely watch the- changing conditions and take such remedial measures as he thinks best by issuing suitable directions to the manufacturers regarding the production or non-production of cloth and the maximum or the minimum quantities thereof. If his duty to specify a period in every direction were regarded as imperative, then in our opinion, it would be defeating the very purpose for which the power was conferred upon him.

10. There is one other reason to reject the contention urged for the appellants Clause (20) uses the words 'shall' and 'may' in different contexts. It states that the Textile Commissioner may from time to time issue. Directions in writing to any manufacturer regarding the classes of or specifications of cloth or yarn which they shall or shall not produce during such periods as may be specified in the directions, and they shall comply with such directions. The use of word 'may' with regard to specification of period and the use of word 'shall' with regard to manufacturers, seems to us that the Central Government used these two words in two different meanings, i e. the word 'may'' conferring a discretionary power on the Textile Commissioner word 'shall' imposing an obligation on the manufacturers.

11. We are, therefore, firmly of the opinion that it is not mandatory for the Textile Commissioner to specify the period during which his directions shall remain in force and therefore, non-men- of the period has not affected the validity of the impugned notification.

12. In the result, and for the reasons stated above, these appeals fail and are dismissed with cost& Advocate's fee Rs, 250/- one set.

13. Appeals dismissed


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //