Skip to content


Shetkari Sahakari Sakkar Karkhana Ltd. Vs. the State of Mysore and ors. - Court Judgment

LegalCrystal Citation
SubjectConstitution;Contract
CourtKarnataka High Court
Decided On
Case NumberWrit Petn. No. 3243 of 1971
Judge
Reported inAIR1972Kant325; AIR1972Mys325
ActsConstitution of India - Articles 19, 19(1) and 31; Sale of Goods Act, 1930 - Sections 4(4); Mysore Sugarcane (Regulation of Distribution) (Ugar Khurd) Order, 1971; Sugarcane (Control) Order, 1966
AppellantShetkari Sahakari Sakkar Karkhana Ltd.
RespondentThe State of Mysore and ors.
Appellant AdvocateV. Krishnamurty, Adv.
Respondent AdvocateK.S. Puttaswamy, High Court Govt. Pleader and ;J.S. Gunjal, Adv.
DispositionPetition dismissed
Excerpt:
.....were burnt on account of electric cables passing over land of petitioner petitioner however, entered into agreement and received compensation in terms thereof held, it is not open for petitioner to seek relief contrary to undertaking given by him. plea raised by petitioner in anxiety to get more compensation that his signatures were obtained forcibly on agreement is not inspiring confidence of court and is not tenable. - 4. it is now well settled that article 19 of the constitution is attracted only when the person concerned is a citizen of india and that the expression 'citizen' in art. 19 of the constitution includes only natural persons and not juristic persons like corporations, co-operative societies, companies, etc. 6. both the contentions of the petitioner fail......order. it is the case of the petitioner that it had advanced nearly rs. 44,600/-to about 800 sugarcane growers within the reserved area as determined by the impugned order with the object of securing supply of sugarcane from them as and when the sugarcane grown by them became ready for harvest and delivery and that by reason of the provisions of the impugned order, the said growers hadbeen prevented from supplying sugarcane which they had agreed to supply to the petitioner to its factory situated outside the state of mysore. in the course of the affidavit filed in support of the writ petition, several contentions have been raised. broadly speaking, the said contentions can be categorised into two parts. the first part of the petitioner's case is that the impugned order is violative.....
Judgment:

Venkataramiah, J.

1. The petitioner in the above petition is a co-operative Society having its registered office at Sangli in the State of Maharashtra. It owns a sugar factory which is also situated in the State of Maharashtra. Respondent 3 is a company having its registered office at Sangli and it has a sugar factory at Ugar-Khurd in the District of Belgaum. Mysore State.

2. The petitioner has challenged in this writ petition the constitutional validity of the Mysore Sugarcane (Regulation of Distribution (Ugar Khurd) Order 1971 (hereinafter referred to as the impugned order). The impugned order was promulgated by the Government of Mysore, on October 14, 1971, in exercise of its powers under Clauses 6, 7, 8 and 9 of the Sugarcane (Control) Order. 1966 read with G. S. R. 1127 dated the 16th July 1966 of the Government of India in the Ministry of Food. Agriculture, Community Development and Cooperation (Department of Food). By the impugned Order, the Government of Mysore determined the quantity of sugar-cane required by the factory of Respondent 3 which is situated at Ugar-Khurd and fixed the quantity of sugarcane to be supplied by the growers of sugarcane in the reserved area to the factory of respondent 3 The impugned order also imposed a ban on the export of sugarcane from the reserved area except in accordance with the conditions of the permit to be issued by the Deputy Commissioner in Form I of Schedule II of the impugned order. It is the case of the petitioner that it had advanced nearly Rs. 44,600/-to about 800 sugarcane growers within the reserved area as determined by the impugned order with the object of securing supply of sugarcane from them as and when the sugarcane grown by them became ready for harvest and delivery and that by reason of the provisions of the impugned order, the said growers hadbeen prevented from supplying sugarcane which they had agreed to supply to the petitioner to its factory situated outside the State of Mysore. In the course of the affidavit filed in support of the writ petition, several contentions have been raised. Broadly speaking, the said contentions can be categorised into two parts. The first part of the petitioner's case is that the impugned order is violative of Article 19(1)(f) and (g) of the Constitution of India and the second part of the petitioner's case is based on Article 31 of the Constitution of India.

3. In support of the first part of the petitioner's case, Sri V. Krishna Murthy, the learned counsel for the petitioner, contended that the agreement under which respondent 3 proposed to buy sugarcane from the growers within the reserved area was one-sided; that the price which respondent 3 was likely to pay was lesser than the price which the petitioner was paying; that the law did not impose any obligation on respondent 3 to buy the sugarcane from the growers and in the event of respondent 3 refusing to buy it the grower was likely to be seriously prejudiced and that in several other respects, the conditions under which the grower had to supply sugarcane to respondent 3 were highly prejudicial to him. He, therefore, contended that the impugned order imposed unreasonable restrictions on the growers of sugarcane within the reserved area and, that therefore, the impugned order was violative of Art. 19(1)(f) and (g) of the Constitution of India. But on behalf of the respondents it was contended that the petitioner was not entitled to urge the above contentions on two grounds, namely, (i) that the petitioner being a co-operative society which is not a natural person was not entitled to rely upon Art. 19 of the Constitution of India to show that the impugned order was unconstitutional, and (ii) that the petitioner had not shown that it was actually prejudiced.

4. It is now well settled that Article 19 of the Constitution is attracted only when the person concerned is a citizen of India and that the expression 'citizen' in Art. 19 of the Constitution includes only natural persons and not juristic persons like corporations, co-operative Societies, companies, etc. vide State Trading Corporation of India Ltd. v. The Commercial Tax Officer. AIR 1963 SC 1811, and Tata Engineering and Locomotive Co. Ltd. v. State of Bihar. : [1964]6SCR885 . A co-operative Society has legal personality of its own and it is entirely separate from that of its share-holders. It has its own name and seal; its assets are separate and distinct from those of its members; it can sue and be sued exclusively for Its own purpose; its creditors cannot obtain satisfaction from the assets of its members; the liability of the members of share-holders is limited to the capital invested by them; similarly, the creditors of the members have no right to the assets of the society. In the above circumstances, a co-operative society cannot in any way be different from a statutory corporation or a company registered under the Companies Act. The case of the petitioner which is a cooperative society cannot be distinguished from the case of the State Trading Corporation and Tata Engineering and Locomotive Company who were the petitioners in the two decisions referred to above. We are, therefore, of the opinion that the petitioner is not entitled to challenge the constitutional validity of the impugned order on the basis of Article 19(1)(f) and (g) of the Constitution. Hence, the first part of the petitioner's case should foil.

5. In support of the second partof the case, namely, that the petitioner was deprived of its property in violation of Art. 31 of the Constitution, it was argued by Sri V. Krishna Murthy that the petitioner had acquired proprietary interest in the sugarcane which had been grown by the growers within the reserved area even before the impugned order came into force and that the petitioner was being deprived of its property without the authority of law. He relied upon Section 4 (4) of the Sale of Goods Act to show that the agreements to sell which the growers had entered into with the petitioner became transformed into completed sales at the time when the sugar-cane grown by the growers became ready for harvesting and delivery. On behalf of the respondents, it was argued that the petitioner had not acquired any proprietary interest in the sugarcane in question. Section 4 (4) of the Sale of Goods Act states that the agreement to sell becomes a sale when the time elapses or the conditions are fulfilled subject to which the property in the goods is to be transferred. An agreement to sell ordinarily when it is entered into is only an executory contract of sale. The property in the goods which form the subject-matter of the contract remains with the seller. But when the subject-matter of the contract are specific goods, it is no doubt true that the parties may enter into an agreement to transfer the property in such specific goods either immediately or on a future date by incorporating the necessary terms in the agreement. If the terms of the agreement stipulate that the property in the specific goods shall stand transferred to the buyer on a future date, or on the happening of any future event the property in such goods would automatically stand transferred to the buyer at the appointed time-The question whether the property in the goods in question stands automatically transferred to a buyer at the time of the agreement or on a future date therefore depends upon the terms of the contract. Section 4 (4) of the Sale of Goods Act does not however say that in every case of agreement to sell the property In the goods concerned would stand automatically transferred to the buyer on a future date. In the instant case, it has to be observed that the petitioner has not produced before the Court the agreements entered into with the buyers. The terms of the agreements are not set out! in the affidavit We are informed that the agreements in question are all to writing. No reason is given by the petitioner for not producing the agreements before the Court In the circumstances, it is not possible for us to decide whether the terms of the agreements entered into by the petitioner with the several growers within the reserved area, have the effect of conferring any proprietary interest on the petitioner in the sugarcane grown by them. We therefore, hold that the petitioner has not established that the impugned order which requires the sugarcane growers within the reserved area to supply sugarcane to respondent 3, has the effect of depriving the petitioner of any of its property. It follows that the question of deprivation of the property of the petitioner without the authority of law in contravention of Article 31 of the Constitution does not arise for consideration.

6. Both the contentions of the petitioner fail.

7. In the result this wilt petition, is dismissed. The petitioner shall pay Rs. 250/- to respondents 1 and 2 (one set) and Rs. 250/- to respondent 3 by way of costs of this petition.


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